Questions to Ask Before Renting a List

By Al DiGuido | Posted August 21, 2003

After a June so rainy here on the East Coast some people were building arks, it's a pleasure to welcome the dog days of summer. Many folks tend to slack off and coast through the summer. But these hazy, hot days are a perfect time to reassess your acquisition-based e-mail efforts and ask some hard questions of the list managers or brokers before renting any lists.

Critical Questions to Ask Before Renting a List
Many pundits peg acquisition-based e-mail response rates at historically low levels, primarily due to the high volume of messages in everyone's inboxes these days. So allocating any percentage of a marketing budget to acquisition-based e-mail is waste, right?

Absolutely wrong.

Although it's true response rates for acquisition are typically lower than those for retention-based e-mail, renting lists to win over prospects and grow a customer base can work wonders ... if you do your homework. When it comes to selecting an acquisition e-mail provider, not all are created equal in their ability to deliver best-performing lists and a high level of service. Marketers who don't conduct the proper due diligence or don't fully understand the e-mail medium are saddled with poor response rates and often negative return on investment (ROI). Those who ask hard questions or partner with a knowledgeable list broker prior to execution can achieve phenomenal results. Let's look at some of those questions:

  • How and where is permission collected? Are lists opt-in? Review the permission collection process. Make sure the list is permission based and provides users the consent essentials, including notice, choice, and access. A higher quality of permission is attained when users actively provide consent to receive third-party offers by checking a box. Opt-in lists greatly outperform opt-out lists. They have lower opt-out rates, have fewer complaints and delivery issues, and provide a more reputable vehicle for your brand. In addition, list managers should be able to source back (via a time and date stamp) to the original point of permission.

  • How often do individuals on the list receive offers? List fatigue kills performance. A frequency cap can ensure lists aren't overmailed. If a list manager can't provide the details on mailing frequency, look elsewhere. That organization probably lacks the control, technical expertise, and reporting basics. Also ask about recency selects. Newer names offer access to new subscribers.

  • Are new names added regularly? Are unsubscribes removed promptly? Frequent uploads of new names and instant suppression of unsubscribes are a must. Your brand will be associated with spam by those who unsubscribed but still receive mailings before their request is processed.

  • Is the list exclusive to this manager? Lists that are housed and resold by multiple managers are probably mailed more frequently. This negatively impacts performance, brand equity, and deliverability.

  • What do the message headers and footers look like? Copy in headers and footers should clearly explain why the recipient is receiving the mailing and provide adequate instructions for updating a profile or unsubscribing.

  • What does the sender line look like? Flagging attention in a cluttered inbox requires an easily recognized sender line. Recipients often delete or ignore messages that arrive from an unfamiliar source.

  • How does the list manager ensure proper message delivery? What's the average undeliverable rate? As filtering becomes increasingly dominant, marketers must make sure list managers are up to speed on delivery techniques and processes. ISP relations and whitelisting are critical. Check all available blacklists for the list manager's IP addresses. List managers should be able to monitor delivery of their campaigns and ensure messages are delivered to the inbox, not a bulk mail folder.

  • Are there creative limitations? Does the list manager check messages for potential delivery issues, including spam filters? Generally speaking, HTML and rich media pull better than text-only messages. If recipients don't state a preference (text vs. HTML), the list manager should be able to transmit messages in multipart so the optimal format is rendered for the recipient. The HTML-only format should be avoided. Some ISPs and e-mail service providers enable blocking of HTML images. Furthermore, the list manager or broker should review your creative for potential delivery issues and check your content against spam filtering software. Finally, a slow image server or coding glitch can also affect e-mail rendering.

  • To what level can you target the audience? Can recipients opt in for information related to specific areas of interest? The best-performing lists provide the most ability to slice and dice the file to find the right people for your offer. Leveraging selects based on demographics, psychographics, even specific stages of the buying cycle will almost always outperform untargeted mailings. Testing tip: You can use limited, untargeted mailings as a control to measure effectiveness of targeted campaigns.

  • What portion of overall price accounts for rental? Selection? Transmission? Does pricing include image hosting? If so, for how long? Are multiple-usage rates available? Is there a make-good policy if campaigns aren't properly delivered? Negotiate prices based on volume, deliverability, acquisition goals, and remarketing efforts. Bear in mind business-to-business (B2B) lists are usually priced higher than business-to-consumer (B2C), as there are not as many quality business lists on the market. Ask the important questions, and you'll get a better sense of overall campaign cost and potential ROI.

  • What are the specific terms and conditions? What kind of reporting and tracking are provided? Review specific terms and conditions for each list rental, including payment terms, message and content requirements, database usage rights, state/federal law compliance, and other considerations. Specify reporting capabilities and frequency requirements up front to conduct the necessary back-end analysis. Most list brokers include this diligence and may also provide, as a value-add, access to ROI calculators and tracking tools to assess individual list performance. Sometimes, a list broker can supply best practices specific to your vertical market. Such additional services can make a huge difference on e-mail acquisition ROI while providing tremendous insight about specific lists, selects, and offers.

Despite the Chicken Littles who claim the sky is falling on acquisition-based e-mail, some marketers still record impressive acquisition-based e-mail campaigns, with response rates as high as the mid-teens. Not too shabby for a supposedly poor-performing tactic.

The secret? Ask the hard questions. Apply time-tested, traditional direct marketing principles before the list manager hits "send." Astute marketers who do their homework and assess the report cards on acquisition e-mail suppliers are rewarded with significant new customer yields. The sky is not falling.

Adapted from ClickZ.com.

Al DiGuido is chief executive officer of Bigfoot Interactive, a provider of strategic, ROI-focused e-mail marketing services and technology. Previously, he served as CEO of Expression Engines, executive vice president at Ziff-Davis, and publisher of Computer Shopper, where he launched ComputerShopper.com, a groundbreaking direct-to-consumer e-commerce engine. Prior to Ziff-Davis, he was vice president/advertising director for Sports Inc.

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