E-mail marketing poised for huge growth

BANGALORE, INDIA: While television commercials, door-to-door leaflets and coupons have become mainstream or maybe an old-hat process, direct marketing through digital ways like e-mails and mobile messages is seeing a demand, bringing a good business opportunity for e-mail service providers.

Speaking to CIOL, Ragy Thomas, chairman of the Board of Directors of Sprinklr India, a newly established Bangalore-based e-mail service provider (ESP), elaborated on the present opportunities in the e-mail marketing and the challenges ahead.

What is e-mail marketing? How does it work?

E-mail marketing is a form of direct marketing, where the company reaches out to its customers using Internet platform and sending electronic mails. The mails could be regarding advertisements, notifications, offers or any other kind of communication. E-mail marketing is a very cost-effective and measurable process of marketing.

Direct marketing is understanding the buying behavior of individuals and reaching out to them more closely. But the difference in case of e-mail marketing and others is that the former helps in measuring customer acquisition and their preferences more accurately than any other medium, that too with a faster Return of Investment (ROI).

The process starts with an ordinary advertising mail sent by ESPs across all walks of life. The ESPs then track the number of mails received in the mailer box, the number of readers who read the mails, the duration of time spend on the mail. This performance report moves down to details like number of customers who visited related links on the page, the topics they visited and other information that they read about.

The second mail send by the ESPs (on behalf of the company) would be more customized than before. For a specific information, it will target the customers who had inquired about that information by visiting the concerned link. In this way companies will get exact number of the new customers and the probable hot leads for their business.

What are the opportunities for this offering in the market?

There is tremendous opportunity for e-mail marketing. Also because of the market slowdown, a lot of companies have constrained their marketing budget. They are migrating from television and print to more direct and cost-effective options like e-mail and leaflets. Companies are understanding that every e-mail that they receive through feedback form or a registration is a potential customer for long-term.

Globally, this digital marketing has reached to varied levels of development - in the US, it has reached to a level of maturity, while in Europe, it is at developmental stage. Asia, especially India, is at a nascent stage, but is poised to grow at a rate twice that of any other geography. Taking an example of our company, from a zero point, Sprinklr India has witnessed a growth of 200-300 per cent in past five months. Almost every week we have joined hands with a new client.

The market size of the US business would be around $ 1.6 billion business, with around 500 billion e-mails subscribed all over. Around 97 per cent of the brands have adopted this marketing method, while in India only 15 per cent of the brands would be following e-mail marketing, with total database of mailers would come around one billion only. In terms of market segment; hospitality and travel, media and entertainment and health care are generating good demand.

How do you distinguish e-mail marketing from mobile marketing?

Though both of them are based on new technology, they are difference from delivery and monitoring aspect. An e-mail marketing provides more transparent results than mobile marketing.

In case of e-mail, individuals can use the provided links to get more information about the offer/ product, but in case of mobile, they have to either visit the venue or website. So mobile marketing can promise to deliver mail, but fail to provide the profile details. So a message about complimentary accessory with apparels, would go to a thousand numbers, while it would benefit just a handful of them. Furthermore, policies like Do Not Disturb restrict the potential of this marketing methodology.

Many companies already have a mailing solution in place, then why would they appoint a service provider?

It is true that a lot of companies use a mail-shooter software to send their newsletters or Electronic Direct Mailer (EDM) to their customers, but there are many advantages of adopting e-mail-marketing solution through a service provider than a mail-shooter.

There is misconception with the marketers that like a mail-shooter, e-mail marketing softwares are bulk mailing solution. But that's not it. Many companies do not realize that their mails are marked as spam or are blacklisted by Internet Service Provider (ISP)l; in many cases the mails reach to the junk folder instead of the Inbox. Also a service provider helps in faster service than any mail-shooter.

The ESPs work on a partnership basis, where they have tie-ups with the ISPs. They also acquire certain certifications for content, security and audit, like a SAS 70 certification, which provides obstacle-free delivery to customer's Inbox.

Secondly, average capacity of a mail-shooter is one lakh mails in an hour. While our benchmark performance has been 40 lakh mailers in one hour. And lastly, as mentioned earlier, unlike a e-mail-marketing software, a mail-shooter software cannot provide delivery monitoring.

Sprinklr India have been around for just six months? How do see the future of your company?

A. Sprinklr's India story started in April 2009. It is technology licensee and co-development partner for Sprinklr US. The USP of our company is providing world-class email marketing at Indian prices. At present, we are based in Bangalore with 25 member-strong team providing digital marketing services to more than 20 clients in the country. To name a few, Mega Mart, Indian Express group, 9dot9 Media Worx and Urja Communications.

Three-four months down the line, we plan to open our offices in Delhi and Mumbai. We are also looking forward to introducing a new marketing solution on social media very soon. This would act as a platform for delivering newsletter and mailers in the social networking sites. With the help of the new solution, companies would be able to talk about their offering through microblogging and other methods of social networking.