… someone at focus.com asked a while ago. Besides legal aspects, this one surely belongs to the most frequently discussed topics. However, the answer is simple: The best email service provider is the one that delivers you a maximum output with a set investment, or a set output with a minimum investment. In other words, it depends on the available budget and on the goal, one wants to achieve. No software fits them all: Template engines, support, deliverability, user interface, professional services … There are many aspects for vendors to differentiate from one another, and many pitfalls for customers.
Think strategically when making a decision
Doing outstanding email marketing also means thinking and acting not just from quarter to quarter, but over the long-term. Having chosen the right email service provider is one necessary condition to be successful. But too often, marketers fail to meet the long term perspective during decision-making. After a few months, they see themselves locked-in with sunk costs and profits that barely exceed the minimum goals within the scenario funnel. Let’s take a look at an example:
“Ok” is not good enough
Let’s assume we want to buy email marketing services from a provider. Our target funnel, built up by one light blue lower and one upper bound, shows our strategic email marketing expectations. I.e. it displays the worst and the best case, for, say, the first two years (= 730 days). After several days of studying interesting blog posts, boards and vendor guides, we finally chose one provider that has been recommended by an expert blogger.
Setup runs smoothly. Costs (red curve) are low as expected. Our email program starts to bring in good revenues (green curve) already after a few weeks. From time to time, we do a little fine-tuning here and continue building our list there. However, after several months it turns out that our profits (fat blue curve) are… well… they are just “ok”. Discussing this in a team meeting it turns out that the interface is often slow, the support team seems incompetent, testing costs more time than initially expected, we got no real template kit, and automation features aren’t as flexible as they told us.
The new one rocks!
After 1000 days,we finally decide to saddle another horse. A decision is quickly made. The new vendor allows easy multivariate testing, hyper personalization, it has built in business intelligence features, a wonderful template engine, super flexible campaign management tools and many more things. Of course all those nifty things got their price: we pay a higher CPM and invest more labor to operate our complex messaging strategy. Therefore, the red curve is rising. But the green curve, our revenues, is rising even more! No wonder – by using an efficient targeting technology, we skyrocketed our email relevancy. After about two years, the profit curve even breaches our upper expectation bound.
Let’s sum it up. Abstracting from e.g. gained email marketing experience, we wasted 288,246.90 Euros during the first 1000 days, or 105,210.10 per year on average. That’s the (undiscounted) cumulative difference in profits between vendor #2, which fitted better to us, and vendor #1, which we chose first. Damn, if we would have known all this before… 😉