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					                                                                    Tpoll
                                                                    Market Intelligence




The Power of Online Direct Marketing
       Identifying the most important trends and
   market intelligence in Online Direct Marketing today




                       July 2007

                 Research conducted and compiled by
     Christina Costa, Rick Eastman, Caroline Green and Anne Vasey
                                               About IPT and Tpoll




                                                                       Tpoll
                                                                       Market Intelligence
Formed in 1999, the Interactive Prospect                     With 8 years’ experience in market research, Tpoll
Targeting (IPT) group of companies is Europe’s               Market Intelligence brings an innovative approach
largest online direct marketing group, and a major           to both online and traditional research techniques.
player in this key sub-sector of the rapidly expanding
online advertising industry.                                 We deliver insight and value, helping to place the
                                                             customer firmly at the heart of our clients’
We provide an advanced range of products and                 businesses. Tpoll joined the IPT group in February
services and an exceptional resource of multi-               2007, and now offers access to the UK’s largest
channel marketing data to marketers across the UK            online consumer panel.
and France.
                                                             To find out more, contact Christina Costa on
To find out more, contact Martin Kiersnowski on              christina.costa@tpoll.com
martin.kiersnowski@ipt-ltd.com




                                                         2
        Overall objectives for The Power of Online Direct Marketing survey


Our aim was to answer the following questions:

Part 1 (a): Consumer survey – Email Direct Marketing Page 7

  What do consumers really think of online direct marketing? Are marketing emails welcomed, or just a nuisance?
  What makes people sit up and take notice of direct marketing emails?
  What do people do with direct marketing emails, and what actions do they take as a result of them?
  How serious is the issue of spam, and how much does it interfere with the activities of legitimate email marketers?

Part 1 (b): Consumer survey – Online shopping Page 40

  Does online direct marketing influence offline purchases?
  How do consumers respond to online advertising and promotions?
  Do people feel confident about buying online, and what part does online shopping play in their purchasing habits?
  Are there any ways that the online shopping experience can be improved for consumers?

Part 2: B2B survey of marketing professionals Page 59

  How does online direct marketing feature in the strategies of marketers today, and what benefits is it delivering to their
  organisations?
  In what ways do marketers manage and analyse their email campaigns?
  How do marketers feel about the online direct marketing medium?




                                                                 3
                                             Part 1: Consumer survey


What we did
We recruited a broad cross-section of the UK online population to take part in this online study.

We opened the survey with a few questions to establish the respondents’ general patterns of Internet and email usage, their
knowledge of the online world and their feelings towards it. We then split the participants into two groups. The first group went on
to answer a series of questions focusing on email direct marketing, and the second group were presented with questions about
their online shopping habits.

What we found: General Internet and email usage
The Internet has established itself as a trusted and accepted medium, and is the first place people turn to for information.
Reassuringly, they don’t feel it has become too commercial. They use it for routine tasks such as managing their personal affairs,
and also as a form of entertainment.

People go online using a variety of devices, with significant numbers now using their mobile phone to read their emails on the
move. Email also has a central role in their lives – to many it’s as important as their mobile phone.

It’s clear that communicating with consumers via the Internet is a way for brands to connect with their customers and prospects
through a medium where they feel comfortable – a medium which is very much part of their daily lives.




                                                                 4
                                                      Sample profile

The sample was sourced from members of IPT’s database, with quotas set on age, gender and location to be broadly representative of
the online population. The respondents are members of one or more sites such as QuizPlayer, EveryInvestor , DailyDietTracker,
MyPropertySpy, MyOffers and OK-mail.




                Sample                       Total                             Sample                        Total
                                     Count           %                Income
      Total                          1862            100              Under £19,999                    439           24%
      Gender                                                          £20,000 - £49,000                592           28%
      Male                            739            40%              £50,000 - £79,999                107           6%
      Female                         1111            60%
                                                                      £80,000 +                         21           1%
      Age
                                                                      No Answer                        760           41%
      Under 24                         69            4%
                                                                      Social Grade
      25 - 34                         176            10%
                                                                      ABC1                             640           35%
      35 – 44                         433            23%
                                                                      C2DE                             676           36%
      45 – 54                         458            25%
                                                                      No Answer                        546           29%
      55 +                            714            38%




                                                               5
                              How comfortable do people feel using the internet?
                                 What is the role of email in people’s lives?
 Only a decade or so after the internet began to filter into our lives, it has become an essential tool for many, with 69% of respondents
 strongly agreeing that they know a lot about how the internet and email work and 32% saying it’s their first port of call when they’re
 looking for information.

 Reassuringly, people don’t generally feel that the internet and email are too commercial. Rather, they seem to see the internet as an
 accepted and trusted medium, with 48% agreeing strongly that it is becoming more, not less relevant to them.

 For many people these days, their mobile phone has become almost like an appendage to their body. Yet over a quarter strongly agree
 that email is as important to them as their mobile phones.

                                        How much do you agree with each statement? Base: 930

                                                                                                                                               10 = Completely
                                                                                                                          12%
                                                                                                        24%                           8 - 10        agree
                                                        32%             30%             26%
                      48%               43%

     69%
                                                                                                        31%
                                                                                                                          61%
                                                                        41%                                                           3-7
                                                        54%                             62%
                                        42%
                      45%
                                                                                                        45%
     27%                                                                                                                                          0 = Don’t
                                                                        29%                                               27%         0-2        agree at all
                                        15%             14%                             12%
      4%               7%

  I know a lot   The Internet is     I keep email  The Internet is   The emails I   Emails are as  Once an email     The Internet /
 about how the   more relevant     accounts open the first place I receive are far important to me account is full     company
Internet works     to me now         because it's       look             more       as my mobile of junk mail I to   emails are too
                                   too much effort                 interesting now                    close it        commercial
                                      to change


                                                                           6
                       Part 1 (a): Consumer survey - Email direct marketing


What we did
Our aim was to uncover consumers’ true feelings about receiving direct marketing emails. Could they tell the difference from
spam? Did they welcome such emails, and if so what types were most likely to make them sit up and take notice? We also
wondered what actions consumers took when they received direct marketing emails.

We looked at the volumes of emails received by consumers on a daily basis, and we asked about issues such as the
effectiveness of spam filters and the way people managed their own inboxes.

What we found: Attitudes towards direct marketing emails
It was good to learn that people are happy to receive direct marketing emails – as many as one per week from any company that
really interests them. However, what really irritates the consumer is irrelevant marketing messages.

The importance of careful targeting was the key learning point which emerged from this part of the survey. The right message to
the right consumer will be welcomed, provided that it’s kept concise and informative. Overt sales techniques are a clear turn-off.

People are most receptive to emails from companies with whom they already have a relationship, but the good news is that many
are also interested to hear from lesser-known brands – so long as they appear genuine.


What we found: Responses to direct marketing emails
Give the consumer an incentive (a discount, exclusive offer or prize draw, for example) and
you have a good chance that your email will be opened – and will generate a response. It also
helps if you’re a recognised brand and a sender whom the consumer trusts.

It’s normal practice for marketers to measure the success of a direct marketing email by the
opens and clicks it generates, but clicking through isn’t the only way a consumer may
respond. Many will navigate directly to the website concerned, and significant numbers may
prefer to visit a store. In particular, consumers like the idea of printing off a voucher and taking
it to their local outlet.


                                                                    7
                Part 1 (a): Consumer survey - Email direct marketing (cont.)


Not only can emails increase store traffic, but these consumers are also highly likely to make a purchase in store as a result of the
email they received.

Keeping email content fresh and exciting is a key success factor that will keep recipients’ mouse pointers away from the unsubscribe
link, and it’s important not to bombard their inboxes by emailing too frequently. On the other hand, a surprising number of people
prefer not to use the unsubscribe facility - sometimes due to distrust, or because they feel they may find future emails of interest
again.

What we found - The problem of spam
It was heartening to learn that consumers can recognise the difference between spam and legitimate direct marketing emails.
However, it’s also important to bear in mind that people will tend to err on the side of caution by deleting direct marketing emails if
they find them in any way suspicious, so marketers need to take care that their messages appear genuine.

Also reassuring is the discovery that inboxes generally are not swamped by a flood of spam, so direct marketing emails shouldn’t get
lost amongst a tide of irrelevant messages.

Spam filters are mostly quite effective, although users are aware that legitimate email can be trapped. For this reason, people check
their junk files very regularly – meaning that any direct marketing emails which are blocked in error are likely to be discovered by the
recipient quite quickly.

Although consumers are generally grateful for their spam filters, they do find them over-zealous at times and would like to have more
control over the filtering process. Many users aren’t aware that they have the facility to block future emails from spam senders, or fail
to use it. All food for thought for the ISPs.

To sum up
The right messages, carefully targeted, will cut through the noise in the consumer’s inbox and produce excellent results for
marketers.




                                                                  8
                                 Where do people go online and check email?
                                What do they do, and what devices do they use?
The internet emerges as an all-purpose tool, used for business, managing personal affairs and as a form of entertainment. As we might
expect, most people access the internet on their home or work PC/laptop – however, as many as 16% access the internet on their
mobile phone and 11% use their phone to read emails. With mobile operators constantly working to encourage their customers to go
online on their handsets, this trend is something to bear in mind when designing websites and email creatives.



                    Which of the following do you have and use to          Please now take a moment to think about all the things you do
                    access the internet and check emails? Base: 908        online and select all things that you feel you do regularly.
                                                                           Base: 891

   PC/laptop at                            33%
      home                                 33%                               Correspondence (personal)                 89%

   PC/laptop at                                                    86%
      work                                                   77%
                                                                             Finding Information                       86%
                            16%            Most people access
  Mobile phone
                           11%             the Internet and
                                           email at work                     Buying / selling                          82%
  Satellite/cable    3%
   digital TV        3%

                                                                             Managing Finances                         56%
                          10%
   PDA/palmtop
                      5%


 Internet video-     2%         Internet                                     Entertainment                             41%
      phone          2%         Emails




                                                                      9
Can consumers differentiate between spam and genuine direct marketing emails?


Nearly half of all respondents (46%) believe that there is a difference between ‘spam’ and direct marketing emails and can be expected
to treat your message accordingly. However, 29% say there may be a difference but they don’t notice it, so your challenge is to make
quite sure that your email doesn’t look ‘spammy’ in the eyes of the consumer. Only 8% of respondents actually think that there is no
difference between spam and direct marketing emails, so the remainder can surely be wooed to your cause by the right message.




                                Do you consider there to be a difference between genuine direct email and spam
                                mail? Base: 711
                46%




                                              29%




                                                                       11%
                                                                                                 8%
                                                                                                                             6%




      Yes, I think there is a           There may be a        I have never thought     No, I think there is no   I don't know/I am not sure
            difference              difference, but I don't           about it            difference at all
                                           notice it




                                                                     10
                               How many emails do consumers receive every day?


  Contrary to popular belief, inboxes are not bombarded on a daily basis. The great majority of people receive less than two of each type
  of direct marketing email per day – this means your message is not competing with vast numbers of others. Only 32% of people receive
  three or more spam emails per day.




                                        How many times a day do you receive each of the following types of email?
                                        Base: 908
                                                                                                                                        Average

DM email from companies I've dealt                                                                                                    1% 2.6
    with / bought from before
                                        7%                32%                         33%                    17%            7% 2%
                                                                                                                                      1%


                                                                                                                                       1%
 DM emails forwarded from friends        11%               30%                        29%                  17%            7% 3%              2.7
                                                                                                                                       2%


DM email from companies I know of                                                                                                     1%
 but never dealt with / bought from
                                             17%                  33%                        26%                  14%         6% 2%          2.3
                                                                                                                                      1%

     DM email from companies I've
      never heard of, but think are                      48%                                                      14%           1% 1%
                                                                                                                            5% 2%
                                                                                             28%                                      1.2
                genuine                                                                                                            1%


  Spam email from companies that                                                                                                      3%
                                                27%                     25%               16%          10%        9%     4%
       don't appear genuine                                                                                                           6% 3.8



                                      None     Less then one a day        1-2       3-5      6 - 10     11 - 15         16 - 20       20 +



                                                                         11
                 How do people feel about receiving direct marketing emails?


The responses show that, in general, people feel either positive or ambivalent about all types of direct marketing email. Only spam
rouses a strong negative emotional response, with 66% saying it’s a total nuisance.
People are most receptive to email from companies they already know, or which have been recommended to them. However, many are
interested to hear from other (genuine) companies – an encouraging 27% would be happy to receive a message from a company that
they’ve never heard of, so long as it appears genuine. This is good news for smaller and lesser known brands who want to take their
first steps into email marketing.


                        For each of the following types of email, which of the following statements best
                        describes how you feel about receiving them? Base: 800


DM email from companies                                                                                            I think they're a total
 I've dealt with / bought   3%3%     19%                         51%                           24%                 nuisance
       from before


    DM emails forwarded                                                                                            I find them quite
                             10%    5%         26%                       39%                      20%              annoying
       from friends


DM email from companies                                                                                            I don't take much
I know of but never dealt    9%      13%                 38%                          32%               8%         notice of them
    with / bought from

DM email from companies                                                                                            I don't mind receiving
 I've never heard of, but     14%           18%                    41%                      21%         6%         them most of the time
    think are genuine

                                                                                                                   I'm happy to receive
      Spam mail from
                                                                                                                   them, I find them
    companies that don't                           66%                              15%        14%         3% 2%
                                                                                                                   interesting
      appear genuine




                                                                   12
                   What do consumers like to see in direct marketing emails?
                                   In their own words…
Asking respondents to tick boxes to select predetermined answers is a traditional yet very effective way of conducting market
research. However, give the respondent the opportunity to share their personal views on a subject and you might have to reach for a
tin hat as they vent their spleen about what they really think of your product or service. By giving our respondents the opportunity
write their own comments we struck a rich vein of email marketing gold.

From the question, ‘Is there any particular type of direct marketing email that you prefer or find particularly interesting?’, our
take-outs were …

Be Relevant
Respondents happily shared with us their favourite subjects of interest. Some of the answers were predictable (clothes, DVDs,
holidays, sport, food, property, events and so on) however some folk had more specialised interests such as genealogy, solar power,
golf equipment, local art exhibitions, fishing tackle and card making.
The overriding theme was that emails must be relevant. Send an email that matches the interests of the recipient and it will be
welcomed, so using carefully targeted data for your mailings is the key to success.

Treat your prospects like adults
What also became very clear was that consumers like to be informed and educated. If you have a product or service to advertise, the
consumer wants the email presented in a “straight to the point manner - not a load of flannel”. They like “the type that are honest
and informative” and “the type that tells you about the product clearly” and finally “informative – non-selling tactics”.

Many folk clearly don’t like to be sold to, so if you present your product or service in a clear, informative manner the consumer is more
than capable of making an intelligent decision about whether to buy or not.




                                                                   13
             What do consumers like to see in direct marketing emails? (cont.)
                                  In their own words…
An incentive goes a long way
The adage that we all like a bargain is never truer than with the Internet. One of the most popular answers to this question was that
people like “vouchers and money off bargains” or “discounts/offers” or “big savings or special offers/deals”.

Competitions and prizes were also ranked as highly as discounts in the list of features that consumers enjoy and take notice of in an
email.

Learning Points
Send an email that is both relevant and contains some sort of incentive; you should enjoy a very good open and click rate.

Do…
     include an incentive (discounts, exclusive offers or               Companies I
     prize draws)                                                      am interested in
                                                                                                       Competitions
     make the email informative, clear and interesting –                    24%
     but keep it brief and to the point                                                                   26%
     treat the prospect as an intelligent consumer
     target the email to consumers who will be interested
     in your offering                                                                                                 Offers
                                                                         Direct
Don’t…
                                                                         10%                                          27%
     hard-sell your product
     waste resources and annoy consumers by mailing to                                     Companies I
     untargeted data                                                                        deal with
                                                                                              10%




                                                                  14
                  What is the right number of direct marketing emails to send
                               to your customers and prospects?
62% of consumers say they would be happy to receive at least one email per week from a company that’s of interest to them. A further
24% would be glad to hear from companies on a monthly or fortnightly basis. The message here is that correct targeting is vital to make
sure you contact only the people who are interested in your services - and don’t be too enthusiastic with the frequency of your
campaigns or you may overstep your welcome in their inbox!


                           How many direct marketing emails would you be happy to receive from a
                           company that you are interested in? Base: 499

                                                              Never   I don't know
                                                Less often     5%          3%
                                                   5%
                                                                               More than one a day
                                                                                       4%
                                 One a month
                                     16%
                                                                                        One a day
                                                                                          13%




                           One a fortnight
                                 8%

                                                                                         Two a week
                                                                                            18%




                                                 One a week
                                                    27%



                                                                 15
                                     What factors influence the open rate?
                                            In their own words…
What is it that makes you decide to open emails? Base: 265
It’s a fact of life that spam filtering is becoming more rigorous, so for some it’s an achievement even to get your email into the
consumer’s inbox.
Following certain guidelines and using the appropriate tools can help you to prevent the ISPs deeming your email to be spam.
Companies like IPT Email Broadcasting are experts in helping you avoid falling at the first hurdle so once your email is safely
deposited into the inbox you should do everything possible to encourage the consumer to open your email.

There were three main and overwhelming reasons why a consumer will open an email. A relevant subject, a known sender and a
clear incentive seems to be the formula most likely to get the user clicking. Here is a selection of the reasons our respondents gave,
including some other keys that open emails:

“If it looks like it could be of interest to me.”                                                   Genuine
“If I recognise the name - basically whether I think the                                          Information
email is beneficial to me - money offers, my hobbies, etc.”                                           27%
                                                                           Relevant
“Free or money-off or free gifts”
“Something I'm interested in will catch my eye, or a good                   37%
offer”                                                                                                       Good offers
“Just if I recognise the name of the company sending                                                           10%
them and I think the content may interest me. The ones
from companies with whom I have had previous dealings,                        Curiosity
depends on the subject matter and on the strap-line.”
                                                                                9%
“If the sender is from a known source, or has a coherent                                             Recognised
interesting subject line.”
                                                                                                       name
“Sale or price reduction.”
                                                                                                        33%




                                                                  16
                                   Which emails are most likely to be opened?

  Some people open all their emails, some delete most of them - but what makes them decide which are worthy of their attention? The
  good news is that the majority of direct marketing emails have a good chance of being opened – particularly if they are from a company
  the consumer has previously bought from, or if they have been forwarded by a friend (only 4% and 5% of consumers respectively would
  normally delete these without reading them).

 Which of the following statements best describe how you feel about
 receiving them...? Base: 800

                     Emails from   Emails from     Emails from                     Spam email
                                                                   Emails
                     companies     companies I     companies                       from
                                                                   forwarded
                     I've dealt    know of but     I've never                      companies    What it is about the sender and/or subject
                                                                   from friends
                     with or       have never      heard of, but                   that don't   line that makes you decide to open these
                                                                   (e.g. money
                     bought from   dealt with or   I think are                     appear       types of emails when you receive them?
                                                                   off vouchers)
                     before        bought from     genuine                         genuine      Base: 619


I open every                                                                                       Recognised
email I receive        33%            14%             10%             41%             4%             name
                                                                                                      33%
I open most                                                                                                               Genuine
emails but do
delete some            48%            39%             25%             38%             6%                             information/Offers
without reading
                                                                                                    Good                    4%
                                                                                                    offers
I mostly delete
them without                                                                                        10%
reading, but           14%            36%             43%             15%            15%
sometimes open
them                                                                                               Products topic /             Curiosity
                                                                                                     Of interest /                9%
I delete them                                                                                      Relevance to me
every time without      4%            11%             21%              5%            75%                 37%
opening them




                                                                     17
                                    Why are some emails deleted unread?
                                            In their own words…
What makes you delete emails without opening them? Base: 265
Online direct marketing has evolved into a sophisticated, effective yet cheap method of marketing products and services to the public.
Unfortunately this success has been hijacked by spammers, who are giving the medium and genuine marketers a bad reputation.
To their credit, most consumers are able to identify and destroy the spam. Hopefully, in time, the medium will once again be the sole
territory of the legitimate and the responsible.
Marketers can learn a lot by looking at the reasons consumers give below for deleting emails without opening them. The idiom "If it
looks like a duck and quacks like a duck...it's probably a duck” comes to mind. Simply replace the word duck with spam.


“If they're completely unrecognisable or suspicious”
“When they have something in the subject line that I disagree with”
“A company that I don’t know much about or never heard of”
“If I don't like the look of them or I have been sent similar before and they are of no interest.”
“They are not relevant to me”
“If I don't know the sender, not interested in the subject or if it looks dodgy e.g. Viagra, porn, great investment idea.”
“If the sender has a foreign name or the subject matter refers to Viagra or has other sexual connotations.”
“I delete anything from a name I don't recognise”
“If they look uninteresting.”
“Because they sound rubbish and its not worth giving them any time whatsoever.”
“Congratulations or something like that.”
“Incorrect spelling in the headline or an offer I'm not interested in.”
“If they have funny made up words in them.”
“They appear to be pushy in what they are trying to sell you.”




                                                                  18
                             Why are some emails deleted un-read? (cont.)
                                        In their own words…
What makes you delete emails without opening them? Base: 265
“From the USA - can’t be bothered with them”
“It is an insult to anyone’s intelligence to think that you can get free gifts for doing nothing but open an email. If an email
does not catch my interest by the subject line I think it is a waste of time to open it. I also do not open any that start with `re-
`, unless I know the sender, as I have been caught with a bug on one occasion.”
“Incorrect spelling in the headline or an offer I'm not interested in”
“Those from unknown sources which attempt to be over-familiar (such as using one’s first name) or are obvious false give-
aways or make ridiculous offers - why would somebody out of the blue offer me a large amount of money, or large material
benefits for nothing!”
“If they are from these silly companies who offer something for nothing like congratulations you have just won a laptop or
similar, these I don’t open. Also the dating ones they really annoy me.”
“Just a gut feeling.”
“If they are too frequent or look phoney or sell goods I do not want.”
“I delete all emails with no subject in the subject line, or those that have references to medicines or say Hi or just look as if
they are spam.”
                                                                                                        Do not
Learning Points                                                           Not interested           recognise name
Do…                                                                       in subject line
     remember that every consumer will have their own
                                                                                                         37%
      interpretation of the emails they receive – one man’s
                                                                                9%
      great offer is another man’s hated spam                                                                         Recognised as
     therefore make sure that any email you send doesn’t                                                                 spam
      LOOK LIKE spam and isn’t interpreted as spam by the                                                                 10%
      recipient (due to your poor targeting, poor copy or poor          Not interest in        Concerns about
      design)
                                                                          product                 viruses
Don’t…
     attempt to disguise your email content like a Trojan                   27%                   27%
      Horse. The recipient will see through your ruse in an
      instant.




                                                                 19
                          How do consumers call a halt to unwanted emails?

A good marketer will always include an unsubscribe link in all their emails, and we would expect that the recipients would use this freely if
they decide they no longer want to hear from that sender. Many do, however a surprisingly high number do so only infrequently (30%),
and 11% never take this simple step.




                        Do you ever unsubscribe from direct marketing emails that you do not want to keep
                        receiving (by following a link available in the email itself)? Base: 710
             30%

                                   26%

                                                   Only 28% of respondents
                                                   unsubscribe all or most of the time



                                                         15%
                                                                                13%
                                                                                                      11%

                                                                                                                             6%




          Yes, very          Yes, quite often       Yes, all the time     Yes, most of the         No, never          I don't know/I am
         occasionally                                                          time                                        not sure



                                                                    20
                               Why do consumers decide to unsubscribe?
                                         In their own words…
What makes you unsubscribe from direct marketing emails? Base: 544

Two reasons for unsubscribing from receiving certain direct marketing emails stand head and shoulders above the rest.

The most common is that the user no longer has an interest in the company or the product or service that they are offering. Not far
behind in second place is the feeling that they are getting too many emails from that company.

Here are a few of the other reasons that consumers give for unsubscribing:

“Too pushy”
“Excessive marketing”
“Periodic spells of 'housekeeping' when I decide if I've actually used or read any of them.”
“Naffness, boring or just plain rubbish content and a lack of belief in the subject being offered or touted.”
“If I don't use them regularly”
“Marketing emails are as much of a nuisance as marketing telephone calls, I don't want them, I don't read them.”
“Sites that appear unsavoury.”
“Some emails are very aggressive with their sales patter. I have on occasions unsubscribed to emails to no avail - they still
send them.”
“Get fed up with the frequency of the emails (too many) OR lose interest”
“Wasting my precious time”
“Information that is not relevant to me e.g. teenage pop, some fashions, and some have a tendency to ask for too much
information that makes me back off.”




                                                                 21
                         Why do consumers decide to unsubscribe? (cont)
                                     In their own words…
“They bore me”
“If I find them not interesting or suspicious”
“Sometimes I have finished with that company and don't need their services any more”
“The fact that offers are not open to UK residents”
“Lack of relevant content”
“Any e-mails from USA”
“If I am not interested in the site”
“No further use to me”

Learning Points
Do…
    Keep the content of your emails fresh and exciting to
     maintain subscribers’ interest
Don’t…
    Bombard your subscribers with emails and overstep                                 Not interested in product
     your welcome in their inbox
                                                                    Of no interest               21%
                                                                        to me
    Write to your subscribers unless you have something
     interesting and relevant to tell them                               40%
                                                                                                     No longer wish
                                                                                                     to receive them
                                                                                                           7%
                                                                    Too many
                                                                  emails received
                                                                       15%             They are
                                                                                       annoying
                                                                                         10%




                                                             22
                                                Does unsubscribing work?

We asked those respondents who do use the unsubscribe link to tell us if they found it effective. The answer was somewhat lukewarm –
only 11% said that unsubscribing always worked, with 81% experiencing some further emails after they believed they had unsubscribed.
The moral for all email senders is to examine your unsubscribe process and do everything you can to make it fast and efficient.




                             How effective do you find the unsubscribe links contained in these types of
                             emails? Base: 616
               61%




                                          20%


                                                                   11%
                                                                                             6%
                                                                                                                 2%

         They usually work       They occasionally work      They always work            I don't know      They never work




                                                                   23
                                                Why not unsubscribe?
                                                     In their own words…

What are your reasons for not choosing to unsubscribe to emails that you don’t want to receive? Base: 69

This is a very serious question for any company that sends emails to its customers or prospects. It’s far better for someone to
unsubscribe from your mailing list than for them to report your emails as spam, as your reputation with the ISPs can be severely
damaged. This can cause all of your emails to be blocked.
The reasons that people gave for not unsubscribing were quite intriguing:

Inertia
Some of our respondents were surprisingly honest when they admitted that the reason they didn’t unsubscribe from receiving
emails was due to “laziness” or that they were “not bothered” and finally “Too much trouble and time consuming normally.”

Suspicion
One of the most common reasons that users didn’t unsubscribe was the fear of opening a Pandora’s Box.
Here are a few examples of variations on a theme about what consumers fear they will unleash if they click on the ‘Unsubscribe’
link in an email:
“Have done that before and have ended up with treble the amount of emails from the same and different companies. It
lets them know that the email account is live.”
“Have been told to just ignore them.”
“It takes too long and what’s the point - for each one you delete you get about 1000 more.”
“It then lets the sender know that it is a live address, which then gets sold on to other spammers.”




                                                                 24
                                         Why not unsubscribe? (cont.)
                                                   In their own words…

Wouldn’t want to miss out
A marvellous example of the peculiarities of human behaviour is illustrated by these next comments. The consumer doesn’t want to
receive particular emails, yet seems to fear that they may miss out on something special if they do unsubscribe:
“I might be interested one day”
“In case I miss something”
“You never know what they are offering”
“Because they might send me one that I am interested in one day”.
There’s nowt so queer as folk!

Random reasons
Here’s a selection of some of the other reasons that consumers don’t or won’t unsubscribe from unwanted emails:
“I don’t trust it to work”
“Didn't know I could”
“Don't know how to do it I suppose”                                                     Laziness             Unaware I could
“Because it could be a fraudulent link. Risk of viruses identity theft etc.”              16%                     14%
“Because I know people can access your computer that way”
“I don’t consider that this practice actually works”
                                                                                            Do not know
“I have not come across any email I want to unsubscribe yet”                                                      Confirms
                                                                                              how to
                                                                                                                 existence of
The main conclusion that we have taken from this collection of replies is that                  7%              email address
consumers need to be educated to show that they can have faith in the                                                14%
Internet. Although our respondents generally say that they can recognise
the difference between legitimate email and spam, their comments imply               More emails from
that they have lingering fears which make them reluctant to trust the                other companies
unsubscribe option as a way to stop unwanted emails.
                                                                                         12%




                                                               25
     What happens when spam filters accidentally trap direct marketing emails?


In their worthy efforts to protect consumers against spam, ISPs can sometimes frustrate marketers by placing legitimate direct marketing
email in the junk folder. However, reassuringly 77% of consumers check their junk folder at least once a week and 51% of respondents
look at it daily. Clearly people are aware that legitimate emails can be junked, and are on the lookout for these - so there’s an excellent
chance that yours will still be seen if the worst happens.




                        How often do you look through the emails in the bulk folder of your main account? Base:
                        All with spam filter: 561


         51%
                                                                                                      Virgin customers are most
                                                                                                      likely to check their bulk
                                                                                                      folder daily:
                                                                                                      Virgin:            64%
                                                                                                      Yahoo:             58%
                                                                                                      Hotmail:           52%
                                                                                                      Other:             49%
                                                                                                      Work email:        47%
                                                                                                      AOL:               46%
                                              15%
                            11%                                                                                             11%
                                                                  4%                                    6%
                                                                                     2%

         Daily            Twice              Weekly          Fortnightly          Monthly         Less often               Never
                          weekly




                                                                   26
                            Do consumers find their spam filters too strict?

Although many users are very happy with their spam filters, a quarter of respondents who use AOL say that their spam filter is over-
zealous to the extent that it treats some of their legitimate email as spam ‘all the time’. Respondents from all ISPs reported that their
spam filters block emails that they have subscribed to or are happy to receive to some extent.



                     Does the ‘spam’ filter ever catch any email messages that you are happy to receive or have
                     specifically requested and move them into the bulk folder when you don’t want it to? Base: 555


                                                                                                               Yes, all the time
                                                                                16%              14%
                               20%             19%              19%
               24%
                                                                                                  1%
                                                                                 1%
                                2%              3%               1%
                                                                                                               Yes, most of the time
               2%                                                                                22%
                                               13%              16%             23%

               24%             27%                               1%                               3%           Don’t know
                                               13%              10%              2%
                                                                                                 11%
               2%                                                               13%
               5%              12%                                                                             Yes, quite often



                                               52%              52%                                            Yes, very
                                                                                45%              49%
               44%                                                                                             occasionally
                               39%

                                                                                                               No, never


              AOL          Work Email          Virgin      Hotmail/ MSN        Other            Yahoo




                                                                  27
                                    How much spam gets into the inbox?

79% of respondents say that their spam filters catch most or all unwanted messages, so clearly they are providing an excellent defence
against spam by and large . The good news for email marketers is that your messages are not competing against a vast tide of spam in
the consumer’s inbox.


                           Thinking about your account, which one of these statements best describes how
                           well the ‘spam’ filter works? Base: All with spam filter: 561


                                                It doesn't work
                                                                I don't know
                                                      at all
                           It lets quite a                           9%
                                                       1%
                          few unwanted
                         messages through
                                 11%
                                                                                       It catches all the
                                                                                       messages I don’t
                                                                                           want 22%




                           It catches most
                              messages I
                              don't want
                                 57%




                                                                28
                                     Do consumers manually block spam?

Most email clients offer a manual way for users to block future emails from any spam sender who sneaks through the defences. It’s
surprising to find that 45% of people, although they are aware that they can click to block spam, rarely or never use the button – it seems
that some people just can’t be helped! Perhaps the ISPs need to do more to educate their users, as 41% of people say they don’t know
or have never noticed if they have a spam blocking button. Could responsibility for deciding what is spam be shifted more from the ISPs
to the users?

                           Does your account have a link or button that lets you block all future emails from
                           the sender of a spam email that you receive? Base: 555


                                         I don't know
                                             25%                                       No
                                                                                       16%




                         Yes, I use it
                         frequently
                            14%
                                                                                           Yes, I have
                                                                                         noticed it, but I
                                                                                          don't use it
                                                                                              20%
                                    Yes, I use it
                                   occasionally
                                       25%




                                                                   29
                                   Spam filters: guardian angels or control freaks?


Generally, people like their spam filter (49% say they’re glad it’s there), but they would still like to have more control over what they
receive. Respondents trust the spam filter to protect them, but are aware it can trap legitimate emails. A third of respondents would like
to be able to set their own filters, and 38% want companies to whose newsletters they subscribe to contact their ISP to let them know.

                                     Now please read through the following list of statements about your spam
                                     filters and tell us how much you agree with each. Base: All with spam filter: 546



       I'm glad it's there and I
         trust it to protect me       7%                   44%                                    49%


      Companies I subscribe
      to should automatically
          advise my email                  18%                      44%                                38%
       provider NOT to treat
        the emails as spam



       It would be better if I
     could set my own filters              21%                          46%                              33%




            I don’t like how it
           controls my emails
                                                         53%                                    41%                  5%



                                       0 = Don’t agree                                               10 = Completely
                                            at all                                                        agree



                                                                        30
                   Sector by sector, how many emails do consumers receive?
                            And how many do they want to receive?
Clearly there are some sectors where email direct marketing is used more extensively than others. Looking at the chart below, it’s
interesting to note the ratio between receiving emails regularly and receiving them too often, in each sector. For example, a total of 68%
of respondents receive travel and leisure emails regularly, and only 18% of these feel that they get them too often. However, whilst
gambling and gaming emails are received by only 43% of people, over half of these feel they receive them too often.




                    Which of the following types of organisations / companies do you receive direct marketing email
                    from and how often? Base: 583


                                                                                              8%                4%
                                                                                                                            Never
                                          25%              24%               21%
       28%              25%
                                                                                                               29%

                                                                                              44%
                                                                                                                            Occasionally
                                          32%                                43%
                                                           49%
       48%              51%
                                                                                                               56%
                                                                                                                            Regularly
                                          20%                                                 34%

                                                                             32%
       19%              17%                                22%
                                          23%
                                                                                              15%                           Too often
                                                                                                               12%
        4%               6%                                 5%               4%
     Media &           Utilities      Gambling and     Motoring and       Mail order        Financial       Travel and
  communications                        gaming          transport                           services         leisure




                                                                  31
                    What forms of email marketing are most commonly used?

 Offers and promotions (60%) and newsletters (51%) are the most regularly received type of direct marketing emails, with over half of
 respondents receiving them regularly. These are the most obvious forms of email for marketers to employ, but not the only effective
 ones. Invitations to events in store and vouchers to print off are received occasionally or never, and yet our research shows that
 consumers would respond well to these (see page 38) with 54% saying they would use a voucher in store at least occasionally. Many
 consumers (64%) would also visit a store at least occasionally as a result of an email.


                            What types of direct marketing email do you receive and how often? Base: 582


  Offers & promotions        9%                               60%                              30%
                                                                                                            2%        Too often
           Newsletters 2%                          51%                               38%                   9%

       Information on
                           6%                         50%                                40%                4%
     products/services                                                                                                Regularly

      Market research      5%                       46%                               43%                   5%


           News alerts            19%                      31%                          50%                           Occasionally
                           1%
Invitations to exclusive
                              12%                           46%                             41%
    events in-store
                           1%
                                                                                                                      Never
              Vouchers          9%                    40%                               49%
                           2%    Nearly half (49%) of respondents never
                                    receive vouchers as direct email




                                                                          32
                     What do consumers like about direct marketing emails?
                                    In their own words…
Is there anything that you particularly like about direct marketing emails? Base: 260
There is no doubt that for many consumers email marketing has become an established and welcome medium for companies to
promote and sell their products and services… as long as it is done in a targeted, intelligent and well-presented way. The list of
reasons that folk enjoy receiving direct marketing emails was long and varied; here’s just a small selection of the comments that we
received:
“I like the long-term aspect of it e.g. I’m planning a new fitted kitchen. This will not be for a while, so emails are a good
source of research information that I can file away to use at a later date. They also lead me to relevant websites to get further
ideas.”
“Yes, sometimes you do get some bargains, find something you’ve been looking for”
“I get to know about certain items that would pass me by otherwise.”
“It gives me a choice if I am interested in a product.”
“I am housebound and cannot browse the shops, so I like to get emails alerting me to new products or special offers that I
may not otherwise be aware of”
“Sometimes they come just at the appropriate time i.e. inkjets just as my computer's cartridge is running low.”
“I sometimes see something that I need but haven’t been able to find locally”
“Better than junk mail through my door”
“Sometimes I get a product marketed that I've been looking for so I am always pleased to receive them when it is saving
me money on the product.”
“Discounted quality products.”
“If you read about a subject in an email it saves on time and waste e.g. paper.”
“I like to read special offers”
“Due to health problems, and limited mobility, I don't get to shop around. The Internet helps me to do this.”
“I'm a shopaholic so I love the excuse to impulse buy!”
“I would rather receive e-mail than waste paper and get it through the post.”
“I quite like the fact that I can respond instantaneously and if I am interested make further enquiries.”
“Sometimes good offers can be found.”




                                                                 33
              What do consumers like about direct marketing emails (cont)…?
                                  In their own words…
“They give you the sense of keeping in touch with new products and services”
“It's nice to be informed, as long as they do not go over the top and push it in your face”
“Shopping from home”
“Direct and to the point”
“Convenience and good product information. Based on the information provided I can also do comparison pricing on other
 websites that make my purchasing a lot easier.”
“Better than cold calling at the door or by telephone - feel that my life is not interrupted”
“I usually find that if I decide to buy something, delivery is pretty quick and reliable”
“Special offers and money off”
“Better than telephone on two important counts - they will be viewed at my convenience, not in the middle of a job or a meal,
 and more time can be given to digesting what is on offer. I have a built in resistance to any form of pressure”
“It saves time going to shops and making phone calls”

Learning Points
Do…                                                                                     Good offers /
                                                                      Convenient /                          Easy to access
    use data intelligently to email consumers with the right                            Bargains /
                                                                     Can shop from                           to information
     offer at exactly the right time                                                       Deals
                                                                         home                                 of interest to
Don’t…                                                                                     12%
                                                                          5%                                        me
    use pressure to sell your products and services – a
     good offer to the right people will sell itself
                                                                                                                   12%

                                                                                            Happy to use
                                                                          Raises
                                                                       awareness of         firms I know
                                                                        products /               4%
                                                                         Services
                                                                           18%




                                                                34
                                What factors are a turn-off for consumers?
                                          In their own words…
There are a number of oft-repeated grumbles from our respondents about the direct marketing emails that land in their inbox. These
include excessive volume, unsolicited and irrelevant emails. It is, however, fascinating to read some of the other points made.
Many of these points are not so much critical of the concept of direct marketing emails themselves but the approach that they use. All
marketers would do well to understand the psyche of the average consumer - these are some of their complaints about direct
marketing emails:


Is there anything that you particularly don’t like about direct marketing emails? Base: 260
“Those that are impossible or very difficult to unsubscribe to, Un-requested, irrelevant rubbish i.e. bingo.”
“Sometimes you just get too many from the same company or from different email addresses advertising the same product.”
“They take up space in my inbox and could possibly be linked to fraud.”
“Anything to do with my personal details and banking.”
“When it’s about something I have no interest in or care for.”
“When they try to manipulate you into buying something in a bullshit way.”
“Silly junk ones about extending your penis when you’re a girl.”
“Infringement of privacy.”
“Too much jargon and small print.”
“Irrelevant, uninteresting and cheap tacky ads annoy me. Unsolicited are ok so long as I find them interesting.”
“Frequency and lack of relevance.”
“When they are obviously from an American or Canadian store and of no use to me at all.”
“Only unsolicited ones.”




                                                                  35
                          What factors are a turn-off for consumers? (cont)
                                        In their own words…
Is there anything that you particularly don’t like about direct marketing emails? Base: 260

“Endless cross-promotions. If I have bought something from a company in the past, the offers I receive are often for
products that are completely unrelated to my original purchase.”
“They assume we are all gullible idiots.”
“No money off vouchers.”
“When they use your name without having had any previous contact i.e. 'Hello Shelley‘”
“Sometimes it can be a bit too flash and rash in its persistence.”
“Too many filling my mail box with rubbish.”
 “It can get a bit long and annoying”
“Phishing emails, and dodgy sites masquerading as large on-line businesses. Prize draws which are actually advance fee
frauds/ barely legal!”
“No because I can always delete it if necessary or unsubscribe to the email again the ball is in my court. Whether I do
anything about it or not is at my fingertips.”
“When they are for things that don’t interest me.”
                                                                                                  Too repetitive
Learning Points                                                                Raises                  8%
Do…                                                                         awareness of
   pitch your advertising copy to fit your audience                          products
   remember that a consumer’s inbox is their personal space –                  18%                Receive too many of
     enter it with respect if you don’t want to be regarded as an                                      them 16%
     intruder
   be transparent and concise
                                                                           From companies
Don’t…                                                                    not subscribed to          Products I am not
   abuse the goodwill that the consumer has extended to you
                                                                                 6%                  interested in 13%
   try the patience of users whose tempers are already frayed by
     the daily tide of spam




                                                               36
                                          What gets consumers clicking?

People are most likely to respond to a direct marketing email if they have already bought from the company (44%) or they trust the name
(42%). However all is not lost if you’re new to the consumer – 42% are inspired by discounts and vouchers. People also respond
positively to features such as prize draws and well-presented descriptions.



                               How likely is each of these features of direct marketing emails to make you respond        Mean
                               to, or follow-up on, a direct marketing email? Base: 496

  A company I have already                                                                                                6.8
                               8%                           48%                                   44%
       bought from

         A name I can trust    8%                           50%                                    42%                    6.7

Discount off products I buy                                                                                               6.5
                                11%                          47%                                   42%
        regularly

               A prize draw       15%                                   60%                                 26%           5.5

   A well-presented/written
                                  15%                                    63%                                 22%          5.4
          description

Different products to what I
                                      25%                                           65%                            10%    4.3
        usually buy

                      Other                                       77%                                    15%         8%
                                                                                                                          1.7

                                             0-2                              3-7                        8 - 10

                                   0 = Don’t agree at all                                        10 = Completely agree



                                                                    37
                 Your email rouses the consumer’s interest: what do they do next?

The obvious (and usually the desired) response is to click through the link in the email to visit your website. However, it’s as well to be
aware that this is by no means the only action that consumers may take. Many (69% occasionally and more regularly) prefer to navigate
to your website rather than clicking the link . But perhaps most importantly we see that email can be an effective medium even if you’re
not an online retailer, because a significant number of people fairly/very regularly visit a store (37%) or use a voucher (18%) as a result
of an email.

                                    When you receive and open a direct marketing email promoting something that
                                    you find interesting, which of the following do you do and how often? Base: 566

      If there is a competition
                                    5%           22%                     36%                             24%                     13%
       or prize draw, I enter it

  Follow the links to find out
                                     11%               21%                     36%                            24%                 9%
             more

If there is a voucher, I print it
                                                 32%                   22%                       28%                  11%        7%
          off and use it

I go directly to the website to
                                           21%                  25%                          35%                      14%          5%
         find out more

   I go to the shop to find out
                                                 33%                      27%                          27%                  9%     4%
                more


 I forward it on to my friends                               60%                                 17%                17%          4% 3%


 If asking for details about
                                                       40%                           32%                        21%              4% 3%
myself I give the information


                                         Never     Very occasionally   Occasionally        Fairly regularly    Very regularly




                                                                       38
                                                How do emails create sales?

Conventional wisdom says that we should measure the success of our emails by analysing the number of clicks and tracking how these
convert into sales. However, as we have seen previously    , there may be other beneficial results which go unrecorded. The store traffic generated
by emails frequently leads to a purchase. An impressive 69% of respondents said that they were likely to buy something when they visited
a store as a result of an email, whilst only 46% felt they would do so after clicking the link in the email. Furthermore, 78% of consumers
said that their decision to buy was influenced to a greater or lesser extent by the email.



 When you receive a direct marketing email promoting something                On occasions when you do buy something, do you think your
 interesting and you go to the shop or website or click a link to find        decision to buy is influenced by the information in the email
 out more, how often do you go on to buy something? Base: 496                 you received? Base: 496
       1%                              1%
                       5%              4%                                               No, not at       I don't know
                                                    I always buy
        8%                                                                                 all,
                                                    something                                                 4%
                                                                                          19%                       Yes, always
                                                    I buy something                                                     5%
                                       41%          most of time but
                       49%
                                                    not always
       59%                                          I occasionally buy
                                                    something
                                                                                                                            Yes, mostly
                                                    I very rarely buy
                                                                                                                              but not
                                                    something
                                       42%                                                                                  completely
                       35%
                                                    I never buy                                                                30%
       26%                                          anything
                                                                                 Yes, but
                       8%              12%          I don't know
        5%     1%             2%              1%                                only a little
                                                                                   43%
   When I go to   When I go     When I follow
    the shop to directly to the  the links in
  find out more   website to     the email to
                find out more find out more




                                                                         39
                             Part 1 (b): Consumer survey - Online shopping

What we did
We began by asking consumers about the types of marketing which influenced them to make purchases of all kinds. We then asked
about their online shopping habits, and their reasons for buying online. For those who said they didn’t shop online, we enquired
about the barriers that were stopping them from doing so.

Finally, we asked if consumers had experienced any problems with online shopping.

What we found: Response to online promotions
The medium of email direct marketing, although relatively very new, is nevertheless as influential as TV and press advertising, and
slightly ahead of postal direct marketing, in driving consumers to make purchases.

Online adverts are also well received – providing they are for relevant products – and many people do click on such adverts.


What we found: Attitudes towards online shopping
Consumers love the facts that online shopping saves time and is very convenient.

Although people tend to feel that it’s hard to spot fraudulent online retailers,
interestingly very few are concerned that online shopping is unsafe. It appears the
many benefits of purchasing online outweigh any risks in consumers’ minds.




                                                                  40
                       Part 1 (b): Consumer survey - Online shopping (cont.)

What we found: Online shopping habits
Online shopping is a frequent habit for consumers. We see a pattern of regular purchases, with the majority of online buyers
spending over £200 per year and purchasing more than ten items. The frequency of online purchases varies across different UK
regions, with London and the South East having the most regular online shoppers.

A wide variety of types of items are bought online – both necessity and luxury products – although the frequency with which
consumers look for different types of item varies.

While some products and services lend themselves particularly well to online retail, it’s interesting to find that online promotions can
benefit companies in almost all sectors. For example, when it comes to larger items such as household appliances and cars, people
are likely to do their research online even though they visit an outlet to actually make the purchase.

What we found: Barriers to online shopping
There are many consumers who could be potential online customers, but for the simple barriers that prevent them. The main
problem is the lack of payment facilities for people without credit cards. Some people also feel wary about security issues, whilst
others prefer the more personal service offered in store.

What we found: Problems with online purchasing
The good news is that the majority of online purchasers have never had a negative experience. For those who do report problems,
the greatest complaints are late delivery, having to pay return postage and having to collect goods from an inconvenient location.

Although clearly consumers are participating enthusiastically in the online shopping experience, there are some ways in which they’d
like online retailers to improve their services. Better product descriptions, more transparent charges and more flexible delivery
options are amongst the changes they would like to see.

To sum up
Consumers have wholeheartedly embraced the online shopping habit – but there’s still scope for online retailers to improve their
approaches and potentially to acquire and retain many more customers.



                                                                   41
                Have non-online shoppers ever purchased on line in the past?

16% of our respondents say they don’t buy on line regularly, and of these 41% of males are likely to buy online more regularly
than females although females are more likely to buy in general.




                                   Have you ever bought anything online in the past? Base: 147


                                  41%

                       35%                                                                       36%
                                                       34%
                                                                                       31%                         Male



                                                                  23%

                                                                                                                   Female




                                                                                                                   Total



                 Yes, a few times but I don't    Yes, but only one or twice               No, never
                        buy regularly




                                                                 42
                          What barriers stop consumers from buying online?
                                         In their own words…
Why have you never bought online? Base: 74

The survey participants who have never purchased online are clearly early adopters or early majority by the very fact that they already
use the Internet, yet the diffusion of the online shopping concept seems to have passed them by.
So what is it that deters these folk from taking the plunge and buying online? The most common comments that we received fell into
three main categories:

Pick a card, any card
It’s perhaps surprising to learn the number of people who do not own a credit card or at least a debit card, but this was a common
reason for people not to have purchased online. Comments such as “No credit card”; “Have no credit/debit card” and “Do not
have a credit card to purchase” were repeated mantra-like throughout our responses.
What could online retailers do to help these potential customers who fall at the payment hurdle? Are there any other methods by
which people could securely send the necessary funds for the goods? Perhaps retailers could collaborate to create an online account
for this purpose?

Trust
A large number of our respondents simply do not believe that the Internet is a secure place to make purchases.
“In case of fraud”
“Too risky”
“I do not trust anyone asking for my bank details, I do not want my identity stolen” and
“I don’t believe the internet is secure enough” were typical of many of the reasons cited.

Whilst there may be some people who will simply never be converted to the online shopping habit, the clear message is that online
retailers should take every opportunity to emphasise the security of their site to consumers throughout the purchasing process.




                                                                  43
                        What barriers stop consumers from buying online? (cont.)
                                        In their own words…
The human touch
For some respondents there was no substitute for physically going shopping - picking up and looking at goods and interacting with
shop staff in person:
“I like to look at the product first hand and shop around for the best deal in the shop” and “Prefer to do shopping in person
and speak to shop assistants” are what two people had to say to explain their reluctance to shop online.

The desire to go shopping is an ancient one, and seeking to suppress it would be fruitless. Rather, perhaps retail website designers
should look for ways to mimic the high street shopping experience by building interactive features and ‘personality’ into their sites?
And if you can’t woo people to shop online, why not use online marketing techniques to encourage them to visit your stores?

Learning Points

Do…
                                                                                                                Prefer to see the
   explore alternative methods of paying online other              No credit card                              product in person
    than credit and debit cards
                                                                        11%                                           11%
   educate the public about the security of safe
    payment systems                                                                     Have no need to
   replicate the pleasures and benefits of traditional                                 use the internet
    shopping in the virtual world, where possible                                             9%

                                                                     Do not want to
                                                                     use the internet                      Do not trust the
                                                                           6%                                 internet
                                                                                                                49%




                                                                  44
 For all types of online and offline purchases, where do people go for information?

 Not surprisingly, the biggest influence on consumers who are looking to make a purchase is the advice of their friends and family. Next in
 line are two online research methods commonly used by people who are actively searching for specific goods: search engines and
 comparison sites. These are followed by a collection of media which are employed by companies to attract passive consumers: press
 and TV adverts and direct mail (email and postal). It’s interesting to note that the young whippersnapper medium of email direct
 marketing is already standing shoulder to shoulder with media such as TV advertising (over 50 years old) and newspapers, which date
 back hundreds of years.

                       When choosing to buy, which of the following do you usually pay attention to?
                       Base: 737                                                                                Average

Recommendation from friends/family           4%                48%                          48%                   7.1

               Website search results       5%                 49%                          46%                   7.0

              Online comparison sites          15%                     51%                         34%            6.0
                                                                                                                          A and C2 are most
                 Press adverts/articles           24%                         64%                        12%      4.5     likely to pay attention
                                                                                                                          to DM emails
                             TV adverts              28%                      59%                        13%      4.4     Social Class:
                                                                                                                          A:               15%
              Direct marketing emails                32%                       56%                       12%      4.1     B:               11%
                                                                                                                          C1:              7%
                 Direct mail in the post                37%                         53%                   10%             C2:              16%
                                                                                                                  3.8
                                                                                                                          D:               13%
                                                                                                                          E:               13%
                         Radio adverts                     49%                            44%              7%     3.1

                      Billboard posters                    47%                            49%               4%    3.0

                                   Other                         60%                        32%            8%     2.5
                                             0 = Don’t agree                                    10 = Completely
                                                  at all                                             agree


                                                                       45
           What were the respondents’ online shopping habits in the past year?

A hefty 69% of our online purchasers told us that they spent in excess of £200 online in the last year. 71% bought more than ten items
during the year, with 28% making over 30 purchases. This indicates a pattern of frequent online shopping over the course of the year as
opposed to occasional major purchases, and it implies that buying online has become an established regular habit.
Perhaps surprisingly, although London boasts one of the finest ranges of shops in the world, respondents in London and the South East
were found to be the most frequent online shoppers.

Approximately how much do you think you spent online in the                     Approximately how many purchases have you made online in the
last year? Base: 733                                                            last year? Base: 733

 £1500 or more                           13%                                      29%                      Respondents based in London & SE
                                                                                                           are more likely to buy more frequently
                                                              44% of people                26%             online
   £1000 - £1499                  9%                          spend over £500
                                                                                                           Region
                                                              a year online
                                                                                                           London & SE:             34%
     £500 - £999                                      22%                                                  SW & Wales:              24%
                                                                                                           Midlands & East:         30%
                                                                                                   18%
     £200 - £499                                            25%                                            North, Scotland & N.I: 28%


     £100 - £199                         14%

                                                                                                            11%
       £50 - £99                   10%
                                       Respondents based in London & SE
                                       are more likely to spend £1500 or                                               6%         6%
       £30 - £49             4%
                                       more online:                                                                                           5%

                                       Region
       £20 - £29        2%             London & SE:             17%
                                       SW & Wales:              14%
  Less than £20     1%                 Midlands & East:         12%
                                       North, Scotland & N.I: 9%                 10 or   11- 20 21 - 30 31 - 40 41 - 50          51 -       101+
        Nothing    0%                                                            less                                            100



                                                                           46
                                                   Annual shopping habits


Reiterating the findings shown on the previous page, the chart below demonstrates that the more money people spend, the more items
they tend to purchase.



            Approximately how much do you think you spent online in the last year? / Approximately how many purchases
            have you made online in the last year? Base: 672



                                                                     £200 - £499: 11 – 20 items
                                                                     £200 - £499: 21 – 30 items
                                                                     £500 - £999 31 – 40: items                                     60
                                    £50 - £99: Less than 10 items                                                                        Less
                                                                                                                                         than 10

                                                                                                       £1500+: More than 40 items
                                                                                                                                    50
                                                                                                                                         11 - 20

                                                                                                                                    40
                                                                                                                                         21 - 30
                                                                                                                                    30

                                                                                                                                         31 - 40
                                                                                                                                    20


                                                                                                                                    10   More
                                                                                                                                         than 40

                                                                                                                                    0
  Nothing   Less than   £20 - £29     £30 - £49    £50 - £99   £100 - £199   £200 - £499 £500 - £999    £1000 -     £1500 or
               £20                                                                                       £1499       more




                                                                      47
              How often do consumers look for different product types online?


Auction sites are most likely to be viewed on a daily basis, reflecting their fast-changing nature. Looking at specific product areas,
shopping for fashion was a daily habit for the highest number of respondents. Groceries, on the other hand, were rarely searched for
daily, but frequently bought weekly – in line with the frequency of consumers’ needs.
Interestingly, a huge 42% of our respondents had never included groceries in their online shopping routine. Since these people already
have the online habit, they must surely be potential customers for grocery suppliers.
The responses show that both luxury and necessity items are regularly being bought online. The least frequent purchases are in the
motoring and financial services sectors, both of which offer products that consumers tend to need at annual or longer intervals.
However, it’s important to note that 68% of respondents do buy financial services products online, and even motoring attracts 59% of
our online shoppers.

                                             Approximately how often do you look for each of the following? Base: 719
      Products on auction sites          18%                13%          11%          15%            6%         15%          10%                   12%

                         Fashion         17%                15%               16%                18%            10%          13%       6%          5%

Books / magazines / music / film       13%                16%            15%                 22%                11%          12%          7%        4%

                        Holidays       13%                      26%                         29%                       15%      3%     8%    3%      3%

         Computing & software                 22%                       26%                    16%              15%           9%      6% 4%         2%

           Electrical equipment        13%                   25%                       25%                      18%            7%     7% 3%         2%

                          Travel       14%                      24%                        28%                        18%        5%       7% 2% 2%

                       Groceries                          42%                           19%                8%         12%     5%      11%      2% 1%

           Household & garden                 22%                      25%                       22%                   18%          4% 6% 2% 1%

  Eating out / nights out / treats               30%                           22%                   17%               17%           6%    5% 2% 1%

             Financial services                     32%                              31%                        16%           10%     3% 5% 2% 1%

                       Motoring                        41%                                  26%                  13%           10%    3% 4%2% 1%

                           Other                                      65%                                        15%              2% 2%
                                                                                                                             6% 3% 3%               4%


                                     Never     Less often       Every 3-6 months     Monthly      Fortnightly   Weekly       Twice weekly        Daily



                                                                               48
                  What is the relationship between online shopping and store traffic?


Searching and buying online is naturally a common habit for these respondents, all of whom are confirmed online shoppers. Products on
auction sites and travel are the most popular purchases for this method of shopping. When it comes to larger items such as household
appliances and cars, respondents are more likely to do their research online and then visit an outlet to buy. Alternatively, some may go
to see the item in the flesh at a store and then make their purchase online. The key message here is that online promotions can increase
store traffic for many types of product, so any high street retailer who is not making use of the online medium may be missing a trick!


                                       In which way do you usually buy these types of products? Base: 710

Search and buy online

      76%
                    65%       61%            61%             56%          48%               42%            41%           40%          36%             29%            23%

  Products on      Travel   Holidays   Books / music /    Financial   Computing &        Groceries    Eating out /     Fashion     Electrical      Household /     Motoring
  auction sites                             film          services      software                       nights out                 equipment         garden

Research online then buy from a shop

                                                                                                                                       35%              38%            41%
       6%                                    22%                           27%              27%             28%           28%
                    16%       19%                            20%

  Products on      Travel   Holidays    Books / music /   Financial    Computing &        Groceries     Eating out /    Fashion      Electrical     Household /     Motoring
  auction sites                              film         services       software                       nights out                  equipment         garden

Look around the shops first then buy online
                                                                                                                         18%                           20%           23%
                                                                                            16%           16%                         19%
       6%            7%        9%             9%             10%          10%

  Products on      Travel   Holidays   Books / music /    Financial   Computing &        Groceries     Eating out /    Fashion     Electrical     Household /      Motoring
  auction sites                              film         services      software                       nights out                 equipment         garden


 Buy over the phone / from a catalogue
      10%            6%        5%             4%             4%           4%                3%             3%            2%           2%               2%            1%


 Products on       Travel   Holidays   Books / music      Financial   Computing &    Groceries        Eating out /     Fashion     Electrical     Household /     Motoring
 auction sites                             / film         services      software                       nights out                 equipment         garden




                                                                                    49
                                                   How loyal are online shoppers?


On the whole, consumers tend to stick to their favourite retailers but occasionally shop around. However, in London, which is the area
where people make the most frequent online purchases (see page 46), there is a sharp divide. Half of the respondents always shop
around as much as possible, whereas 28% have a few online retailers which they always stick to.

                     Which of the following statements would you say most describes how you feel about online retailers? Base: 710


  I have a few favourite ones that I always stick to

                            28%                                                     22%                                                    26%
        18%                              21%          19%           14%                        17%                          16%
                                                                                                             11%
  Northern Ireland        London       Scotland       East       North West         Wales    Midlands     South East     North East     South West




  I usually stick to the same ones but occasionally do some extra research and shop around

        37%                                                                                                    44%            38%
                            6%           32%          32%            29%             26%         32%                                         26%

  Northern Ireland         London       Scotland       East       North West         Wales     Midlands     South East     North East     South West




 I usually stick to the same ones but if I receive a special offer from another company I'll take it up
                             17%           18%         16%            20%             22%        19%           23%            22%             19%
         12%
  Northern Ireland         London       Scotland       East      North West          Wales    Midlands     South East     North East     South West



 I always shop around as much as possible

                            50%
         33%                               29%          32%           37%             30%         32%                                          29%
                                                                                                                22%            23%

     Northern             London       Scotland       East      North West          Wales    Midlands     South East     North East     South West
      Ireland




                                                                               50
                                                  What do consumers like about shopping online?


             Our respondents agreed that the great benefits of online shopping were time-saving (72%) and convenience (66%). People also loved
             the wide variety of products available, including unusual items that are hard to find in the shops. This underlines the way that the internet
             has given niche retailers the opportunity to establish viable businesses which simply wouldn’t have been possible on the traditional high
             street, where customers for a shop specialising in back-scratchers or size 15 shoes would come along once in a blue moon. It also gives
             larger brands the chance to sell a wider range of products than they can accommodate on the shelves of their stores, as well as
             sensitive items which consumers may prefer to purchase in the anonymous environment of the internet.
             Fascinatingly, whilst 38% of respondents said that it was hard to spot untrustworthy online retailers, only 5% felt that it was actually
             unsafe to shop online.
             The responses to our questions on online advertising were pleasingly positive, with over a third of respondents saying that they liked to
             see adverts for relevant products online, and over a quarter confirming that they often clicked on such adverts.



                                                         How strongly do you agree or disagree with each statement? Base: 672

                                                                                                                                                                                                    14%             10 =
                                                                                                                                                                                       26%
                                                                                                           41%             40%                   40%            38%         36%                                  Completely
                                                               55%           51%            48%                                                                                                                    agree
                     66%        65%            63%
72%                                                                                                                                                                                                 48%
                                                                                                                                                                                       44%

                                                                                                                                                                47%         48%
                                                                                                           54%             54%                   52%
                                                                             45%            47%
                                                               42%                                                                                                                                  38%
                     31%        32%            34%
26%                                                                                                                                                                                     30%
                                                                                                                                                                 15%         16%                                  0 = Don’t
              2%                                                                             5%            5%               6%                    8%
                      3%        3%             3%               3%            4%                                                                                                                                  agree at
                                                                                                                                                                                                                      all




                                                                                                                                                                                      Click on




                                                                                                                                                                                                 untrustworthy
                                                                           Easy to find




                                                                                                                                                                           Relevant
                                                             Buy hard to




                                                                                                                                                                                      adverts
                                                                                                                                 information




                                                                                                                                                               enjoyable
Saves time




                                                                                                                                               Buy more if I
                                                                                          Stick to well-




                                                                                                                                                                           adverts
                   convenient




                                               Cheaper




                                                                                          known sites
                                                                            products




                                                                                                           It is safe
                                                              find items
                                Wider choice




                                                                                                                        Enough




                                                                                                                                                                                                  companies
                                                                                                                                                                  More
                      More




                                                                                                                                                  could




                                                                                                                                                                                                      Spot
                                                                                                           51
                                     Bad experiences whilst shopping online

A pat on the back for online retailers is in order: over three quarters of our online shoppers had never had a negative experience. For
those who did report some cause for complaint, we looked at regional incidence. Northern Ireland (86%) and the North East (86%)
were found to have experienced the fewest problems. Shoppers in London had a particularly high level of poor experiences (45%), but
it should be remembered that this is also the region where online purchasing is most frequent (see page 46 ), so a greater incidence
of problems could be expected.


                                                                                                             London (45%) and Scotland
                                                                                                             (30%)had the most bad
                                                                                                             experiences with shopping online
                                  Have you ever had any bad experiences shopping online? Base: 719




                                                                                                                                 55%            No

                                                                                                                   70%
   78%                                                                     79%          79%          77%
               86%          86%         84%        84%         83%




                                                                                                                                 45%            Yes

                                                                                                                   30%
   22%                                                                     21%          21%          23%
               14%          14%         16%        16%         17%



  Total      Northern   North East     East       Wales    South East   North West   South West   Midlands      Scotland      London
              Ireland




                                                                  52
                           What problems have online shoppers experienced?


  Failure to deliver the goods at all was fortunately a fairly rare problem, but the most frequent poor experience was late deliv ery. Having
  to pay for return postage was a big bugbear for our respondents, and over a quarter complained that they had been forced to collect their
  goods from an inconvenient location. When we remember that convenience was cited as one of the greatest benefits of shopping online,
  it’s clear that online retailers who create these barriers for their customers are in danger of killing the goose that lays the golden eggs!




                     Which of the following do you experience when shopping online and how often? Base: 667



                                                                                                                                    Never
                                                                                                      38%



                                                                                      65%
                                                                                                                                    Occasionally
                     75%             74%             74%             72%
     79%
                                                                                                                      89%



                                                                                                                                    Regularly

                                                                                                      59%


                                                                                      25%
                                                                                                                                    Too often
                                     24%             23%             24%
                     24%
     20%
                                           1%              2%              2%                               2%              1%
                                                                                            7%                        8%
           1%              1%              1%              1%              1%               3%              1%              2%


Not delivered    Purchase         Wrong           Delivery       Collect from Pay for return      Delivered         Other
                 damaged          product       instructions    inconvenient    postage              late
                                 delivered      not followed      location


                                                                     53
                                What happened when things went wrong?
                                         In their own words…
When you had bad experiences shopping online, what was particularly bad about them? Base: 144

The list of experiences reported was as rich as the tapestry of life itself; here are a few examples:
“Very late delivery (2 months)”
“I bought two tops off eBay that said they were brand new but when they arrived they were full of holes and smelt”
“Sellers selling fake good claiming they were genuine.”
“Ordered a netball kit for a tournament 2 weeks before the event and it was delivered to the wrong address and a week
too late!”
“I booked hotel and train to Nice (France) online believing I was getting a cheaper deal, but they only booked the hotel,
and I had to pay full price for train at a later date.”
“My goods didn’t turn up and I was too embarrassed to tell my bank even though I was charged because my goods were
a bit risqué!!!!”
“I purchased some DVDs that turned out to be pirated
merchandise.”
“The product that came to the house was damaged - they
tried to tell us it was our fault and we had to fight with them        Items never                                    Faulty
to exchange it.”                                                         received                                   goods 17%
“Postage was 5 times cost of product!”                                     30%
“The photograph of the product did not show the                                          Goods not as
cheapness of the product”                                                                 described
                                                                                            22%
Learning Point
      Differentiate yourself from the many online cowboys by               Fraud
      delivering on your promises.                                                                  Late delivery
                                                                            9%
                                                                                                        17%




                                                                  54
          Who was responsible for the bad experiences reported by online shoppers
                                      - and how were the problems resolved?
   Over half (52%) of respondents blamed both the retailer and delivery company for their bad experiences. It could be argued that this
   may be because they were unable to distinguish who was at fault, and this highlights the fact that an online retailer who uses an
   inferior carrier could find themselves tarred with the same brush when problems arise.
   It’s good to see that the majority of problems were dealt with satisfactorily in the end. However, the fact that 40% of respondents said
   that the issue wasn’t always resolved means that online retailers still have room for improvement. Given that large numbers of online
   shoppers remain loyal to their favoured brands (see page 50) and return to buy online on a regular basis (see page 46) it’s
   worthwhile to go the extra mile to keep your online customers happy.


    Who would you say is usually responsible for these bad                Would you say that these experiences are usually resolved to your
    experiences? Base: 145                                                satisfaction in the end? Base: 145
                                                                                                                   ‘
                                                                                              60% of the time people s
                                                                                              problems were mostly resolved

                                                                            Most of the
                                              Both of them                    time                                     Always
                                                  52%                          47%                                       13%

The delivery
 company
    12%                                                                                                                         Very rarely
                                                                                                                                    8%


                                                                                                                                 Never
                                                                                                                                  3%




                                                                                                                         Some of the
    The online
                                                                                                                            time
     retailer
                                                                                                                             29%
       36%




                                                                     55
  What can you do to improve the online buying experience for your customers?
                              In their own words…
In your opinion is there anything that online retailers could do to make the experience better? Base: 504

If you’re an e-tailer then you should pay particular attention to this section. You can’t please all of the people all of the time, but the
following insight could just make a difference to your business.
You’ve succeeded with the hardest part of online marketing: your prospective customer has arrived at your website and they have
money to spend. Unfortunately, for many e-tailers it rapidly slides downhill from here - their websites are badly designed, their
products poorly marketed, their customer service is lacking and the delivery process is frankly dire.

A picture is worth a thousand words
Think for a moment: unlike the high street, where a shopper can pick up a product and study it at close range, with the Internet the
he or she has to take a huge leap of faith . Clothes can’t be tried on for size; an electrical gadget cannot be studied to the nth degree
- yet the images and descriptions of products on some websites are woefully inadequate.
The number of respondents who complained about poor or minimal product descriptions astonished us. “More and better quality
pictures”, “Supply enough detailed information on the products”, “The pictures are quite poor”, “Put them in layman’s
terms not jargon” and “More information, images and comparisons” are just a few of the comments about the important art of
selling your goods.

User unfriendly?
Not everyone who uses the Internet is web savvy. Websites - and particularly commerce websites - need to be intuitive, easy to use,
informative and well laid out and designed.
It appears that these rudimentary rules are often being ignored. Our survey respondents said; “Make website more user friendly”;
“Some website design layouts have not been thought through sufficiently for Joe Public to use easily”; “I’m not there to
read adverts”; “Tone down the multi-coloured, busy looking pages”; “Make websites simple for the senior citizen to
follow” and “Simplify the website.”
This last comment made us giggle: “I found the site rather confusing and ended up with one banana (and not one bunch).”




                                                                     56
What can you do to improve the online buying experience for your customers? (cont.)
                              In their own words…

Customer service
The maxim that it’s cheaper to retain rather than recruit a customer seems to be forgotten when it comes to online customer service.
You don’t have a face-to-face relationship with your customers, but they still expect to be valued and respected as if they were
handing money over a counter.
The following comments indicate how shoppers can feel frustrated in their communications with online retailers: “If having problems,
send an email to let the customer know”; “Include a telephone number”, “Some online retailers are slow getting back to me”
and “They should read their reply/query emails more frequently.”
It’s not surprising that the following complaint was posted in capitals: “HAVE A DECENT PHONE SYSTEM - NOT 0845-PROFIT -
PROFIT - PROFIT – WHY SHOULD I LINE THEIR POCKETS SORTING THEIR PROBLEMS OUT?”
We quite agree; some could consider this as sharp practice!
After-sales service gets a bashing too: ”Follow-up email to make sure that the product arrived.”

Delivery companies/delivery times
Considering that many people purchase online for convenience it’s ironic that the delivery of many of those goods couldn’t be more
inconvenient!
These comments are the mere tip of an iceberg of grumbles about the frustrating process of receiving purchases. The carrier is often
slated: “Use only reputable carriers”; “Make it clear which carrier will be delivering the product and provide better online
tracking to ensure you are in when it is to be delivered” and “When items cannot be delivered there should be a holding
place locally where they can be collected, not as usual over 10 miles distance.”
Both the cost and clarity of delivery charges get both barrels, with many respondents calling for “Free delivery” or “Reduced
shipping costs”, “Delivery costs/VAT included with item, not at checkout” and “Ensure that delivery charges are clear early
in the transaction.”

And finally, the physical act of delivery is a huge bugbear: “A space for instructions for driver”, “It would be much more
acceptable if weekend and evening deliveries could be more readily available”; “Guarantee a delivery date, and approx time
would be helpful”; “Follow instructions more clearly i.e. don’t give to neighbours who are known thieves, so I have to get the
police to try and get it back” and “If there’s a problem with delivery date they should let the customer know by phone.”




                                                                 57
What can you do to improve the online buying experience for your customers? (cont.)
                               In their own words…
Free return postage
A great number of respondents complained about having to bear the cost of return postage for faulty or unwanted items (those that
are not as the customer expected). Whilst this is a difficult issue with regards to a company’s bottom line, it’s one that should be
addressed:
“Free postage to return products that are not suitable, or a carrier that can do this.”

Miscellaneous moans
Out of stock merchandise annoys our respondents: “Make it clear if item not in stock and say when it will be in”. Other
suggestions included: “Exact measurements for clothes would be helpful”; “Let more people use their debit card. Not
everyone has a credit card” and “Let us think for ourselves.”

Novel ideas
Our research showed that respondents can come up with creative ideas as well as complaints, and the following comments caught
our eye with regards making the shopping experience more enjoyable: “Spoken description of the item” and “Play music in the
background whilst shopping”.
                                                                                                                    Easier
Learning Points                                                                         Better                 navigation of site
Do…                                                                                   descriptions                   11%
       include detailed informative descriptions and good pack shots of                  12%
      your products
       ensure that yours is a website for sore eyes                                                          Better customer
       keep your charges transparent and make payment simple                                                     service
                                                                               Better delivery times
       think about customer convenience and offer a package of delivery          / details / out of                 4%
      options to fit their needs
                                                                                  hours delivery
  Don’t…                                                                                                            Better pictures
                                                                                        9%
       take your customers for granted - they’ll vote with their keyboard!                                                5%




                                                                 58
                       Part 2: B2B survey of marketing professionals

What we did
We asked 223 marketing professionals from a wide selection of industry sectors about their marketing expenditure as a whole,
and in particular how online direct marketing features in their marketing mix. We wanted to understand their attitudes towards
email as a medium, the ways they employed it, and how email campaigns had proved successful for their organisations.

What we found
In a business environment where marketing expenditure as a whole is showing an upward trend, online direct marketing is
featuring ever more prominently amongst the disciplines employed by businesses.

Voted top for ROI*, email is rapidly being embraced by marketers, with the numbers who do not include it in their plans dwindling
fast. Those marketers who have already seen the light are generally increasing their investment in online direct marketing.

Online direct marketing can bring success in a wide variety of campaigns, both for recruitment and retention, but it’s particularly
valuable when it comes to building a relationship with your existing customers – email newsletters are an excellent way to
achieve this. For the best response rates, including special offers and promotions in your email is a winning technique.

For supplies of data, some of the most valuable sources are list rental from data owners,
data brokers and third party websites. Of course, your own database, even if only small,
can be your most valuable source of core data if you know how to unlock its potential.

Despite the widespread adoption of the online medium amongst marketers, many have
still to discover how to refine their use of it. Data cleaning is one area where learning
points emerged, and many marketers are also missing out on the opportunity to analyse
the open and click results of their email campaigns.

On the other hand, it’s clear that simply measuring the success of your email by the
number of opens and clicks it receives is not the end of the story – the exciting thing
about email marketing is that it also generates sales through more traditional channels.        * Search and affiliate marketing excluded from this part
With the ability to drive traffic both to websites and retail outlets, email is a medium that   of the survey on the grounds that their exceptional
truly pulls its weight and earns its place in today’s marketing strategies.                     ROI would weight the results too strongly.




                                                                  59
                             Sample profile

             Sample                           Total
Total                                  223            100%
Media (traditional)                    23             10%
Automotive                              5             2%
Charity                                16             7%
Financial services                     23             10%
FMCG                                    9             4%
Retail                                 19             9%
Government                              8             4%
Home shopping / mail order              6             3%
Insurance                               7             3%
Leisure & entertainment                12             5%
New media                              15             7%
Travel & holiday                       29             13%
Utilities                               6             3%
Telecoms                                9             4%
Other                                  36             16%




                                  60
                          What are the current trends in marketing expenditure?


 Looking at the numbers of companies falling into each expenditure bracket for 2006 and 2007, we can see that there’s a shift from the
 lower ranges towards higher expenditure levels. For example, 2% more companies expect to have spent £10 million or more during
 2007 than in 2006.



                       Approximately what was your company’s total marketing expenditure in the UK in 2006?
                       And what do you estimate it to be in 2007? Base: 216

                                                   3%           3%

                                                                             2%                         2%                                          2%
  2007                                                                                    1%                                          1%
Percentage                                                                                                             0%

 change
                                                                                                                                                                  -1%
              -2%
                          -3%
                                      -4%

                          26%
  2006

                                      14%
                                                  11%
                                                                             8%                                        7%                            8%
               5%                                               6%                        5%            6%
                                                                                                                                      3%                          2%


             Nothing    Less than   £50,000 -   £100,000 -   £250,000 -   £500,000 -   £750,000 -   £1,000,000 -   £2,000,000 -   £5,000,000 -   £10,000,000   Don’t know
                         £50,000     £99,999     £249,999     £499,999     £750,999     £999,999     £1,999,999     £4,999,999     £9,999,999      or more        / NA




                                                                             61
                             Which disciplines are included in marketing budgets?


   All areas are showing healthy increases from 2006 to 2007. Radio, postal direct marketing and outdoor advertising have enjoyed
   particularly strong growth. However, the greatest numbers of marketing budgets include the online medium, with the highest numbers
   of marketers investing in their companies’ own websites, closely followed by direct marketing emails and viral emails.




                Which of the following types of marketing is covered by that expenditure in the UK in 2006 and 2007? Base: 216




                                                                                                                                                        17%
                                                                      14%
                                                        9%                                               10%
    2007           7%         7%           6%
                                                                                   8%         8%
                                                                                                                         4%              5%
Annual change
                  Other   Own website   DM emails   Viral emails    Postal DM     Other      Press     Outdoor           TV             Event          Radio
                                                                                 websites             advertising    advertising     sponsorship     advertising



    2006

                  89%         88%          87%           83%            77%         77%        76%         71%            70%             67%
                                                                                                                                                          43%



                  Other   Own website   DM emails    Viral emails    Postal DM     Other      Press     Outdoor            TV             Event          Radio
                                                                                  websites             advertising     advertising     sponsorship     advertising




                                                                                    62
                                    Which marketing medium delivers the best ROI?


Direct marketing email is the clear leader for marketers wanting to get the best bang for their bucks*, with 47% of our respondents voting
it in first place for ROI and 26% and 11% respectively rating it second and third. Postal direct marketing is also found to be a highly cost-
effective medium, followed by online advertising. Outdoor is considered to give the lowest returns.


              In your personal opinion, which of these different marketing activities has shown the best return on investments
              for your business to date? Base: 216

47%


                  39%                     40%




                                    28%
      26%                     25%                                                                 26%
                                                     24% 25%         23%                                      22%
                        18%                                                           19%
                                                                                                                    17%
                                                               14%                                                                    15%
                                                                           12% 12%                                              13%
            11%                                                                             10%         10%               10%                      11%
                                                9%
                                                                                                                                              7%         7%
                                                                                                                                                                       4%
                                                                                                                                                                 1%



DM emails         Postal DM         Own website        Other               TV           Press           Viral email          Event                 Radio            Outdoor
                                                      websites                         adverts                            sponsorship


                                                      1st                        2nd                            3rd
                                                                                                                                *Search and affiliate marketing excluded from this part
                                                                                                                                of the survey on the grounds that their exceptional
                                                                                                                                ROI would weight the results too strongly.




                                                                                 63
       What proportion of marketing spend is devoted to email direct marketing?


In 2006, almost a fifth of respondents were not including email direct marketing in their marketing mix. However, in 2007 this had halved
to less than 10%, demonstrating the continued growth and acceptance of the medium. For companies who had already adopted email
marketing there was steady growth: from 2006 to 2007, numbers of marketers spending between 1 - 50% of their budgets on the
medium were on the increase.

 Approximately what proportion of your 2006 expenditure in the UK was spent on email direct marketing and what do you estimate it to
 be in 2007? Base: 216

                               7%


2007                                                  2%
                                                                  3%
                                                                                                                                            1%
                                          0%                                   0%          0%          0%                      0%

                    -1%                                                                                           -1%




         -10%


2006
                    29%
         19%
                              10%
                                           6%
                                                       2%          1%           1%          0%          1%          1%           1%            1%

        Nothing   1 - 10%   11% - 20%   21% - 30%   31% - 40%   41% - 50%    51% - 60%   61% - 70%   71% - 80%   81% - 90%   91% - 100%   I don't know




                                                                        64
       In your opinion, what (if anything) is good about email direct marketing?
      Does it offer anything that other online or offline marketing activities don't?
                                   In their own words…
There is a real consensus between the 85 marketers who offered their opinions about the benefits of email marketing.
It’s cheap, it’s flexible, it can be highly targeted, it’s trackable and, in these days of all things green, it’s environmentally friendly. In fact
we wonder if the five people who were negative about email marketing are doing it right!
Here’s a selection of comments from our respondents:

“Direct to inbox - feels personalised. Gets straight to the consumer”
“Email direct marketing allows you to market to large segments of your database with a clear message at relatively low
cost.”
“Better ROI and much easier to track effectiveness”
“Immediate, offers interaction with existing customers & those interested in your products for a minimal cost.”
“Low cost. Flexibility. Reach targets at all locations/hours. Environmentally friendly. Measuring performance/effectiveness”
“The cost is minimal and so the ROI is potentially high. It also has the advantage of speed of delivery.”
“Good for immediate impact following a telephone conversation”
“Ability to communicate with customers in a more in-depth way, whilst at the same time allowing very quick turnaround of
messages and tactical campaigns at very low cost.”
“It gives you the opportunity to interact with your customers quickly - no need for planning expensive mail pieces - if you
want to get in touch with your customers for a specific promotion or offer it can be done in a timely manner. Also allows
customers to easily share offers with their friends through forwarding.”
“Low cost way to retain & build relationships with your customers, whilst being flexible enough to facilitate personalisation”
“No associated print or postal costs. Able to reach people on specified days/time of day. Able to analyse response quickly.”
“The best benefit has to be the excellent level of reporting available on email marketing campaigns, and the ability to then
use that information to tweak future campaigns through better segmentation.”
“Promotes services to clients who are on email. Useful resource for information, research, networking.”
“While I am sure many people print out many email communication, the net result surely has to be less
paper/envelopes/stationery wasted than during the days of 100% postal DM. Also, we cannot access our 'conventional' post
while out of the office!”



                                                                         65
                            What should email direct marketing be used for?


Respondents indicated that email worked for them on a broad range of levels. However, they found it particularly useful for customer
retention. This ties in with our consumer survey findings, where respondents said that they welcomed emails from companies they had
previously bought from or dealt with (see page 12). Brand awareness, cross- and up-selling, and customer acquisition campaigns were
also found to work well, indicating that email is useful both for looking after your existing customers and recruiting new ones.



                  For which of the following marketing activities do you believe email direct marketing to be useful? /
                  Which one do you think it is most useful for? Base: 216
         70%
                      67%
                                    65%

                                                   60%




                                                                 39%



                                                                                 30%




                                                                                                         Benefits of DM email
         38%
                                                                                                         Main benefit


                      17%                          16%
                                    15%                                                        5%
                                                                                                                 3%              3%
                                                                  4%             1%            4%                                3%
                                                                                                                 2%
      Customer       Brand        Cross / up     Customer         PR        Brand imagery   Don’t know          None            Other
      retention    awareness       selling      acquisition




                                                                  66
    In your own words, what do you think it is about the sender and/or subject line
              that makes people decide to open direct marketing emails?
                                In their own words…
It’s delightful to see that so many marketers have discovered what turns on and turns off the consumer. The similarity between answers
given by both marketers and consumers about why they open marketing emails is amazing.
Relevance, timeliness and a clear message from a trusted sender are the keys to a successful campaign. There does however appear to
be some dissent over the use of the word ‘Free’:

“Is the sender recognised and is the subject relevant”
“Clear messages that don't clutter or try to over sell. Tell it like it is.”
“It must differentiate itself from the large volumes of spam received daily.”
“I personally think it works best to keep it simple and no hard sell, we get more mail opened with a heading such as ‘newsletter’
than we do with an heading such as ‘massive savings now’ or ‘big offer’. We feel that this can put people on the defence mode
straight away and they will not even give the email a chance, thinking they do not want to buy anything, rather than just looking
at a newsletter with no hard sell and then seeing one of our offers and making a purchase”
“They need to be a trusted provider of information. With the amount of spam that is around nowadays, the majority of recipients
are apprehensive about anybody sending them an email that they don't know or weren't expecting”
“Personalisation (their name etc.), offers, something they identify with, something they are interested in”
“The recognition factor is key; the subject line can have an impact, but its effectiveness is mediated through an awareness of the
identity of the sender.”
“Meaningless subject lines are a turn-off (in my opinion)”
“It needs a strong and trusted brand and to exclude spam phrases”
“They need to think they have asked for this information or the sender knows enough about them to have authority to send it”
“Recognition. It's the single biggest factor IMO. Recipients skim read their inboxes for names and brands that they are familiar
with. I'd suggest that it's even worth galvanising subject lines with brand names to re-enforce the sender line.”
“How does it relate. If you have a wooden leg and you get an email headed medical breakthrough Mr XXXX your leg could be
saved from wood worm... 'Make it personal'.”
“If mailed to the right audience, the line will be something they need. Also if states free most people will open.”
“Avoid words like 'limited', 'special offer', 'free', etc”
“There is no panacea. Trust and consistency are the key things in our experience”




                                                                  67
                                Which types of direct marketing email work best?

    The results of this part of the survey show that marketers’ perceptions about the way consumers respond to their emails are generally
    very close to the reality expressed by our consumer respondents. For example, offers and promotions are thought to have a high
    success rate, and this is backed up by the fact that 42% of consumers say they are inspired by discounts or money off products or
    services that they buy regularly. However, our consumer research should help to satisfy the doubts of the many marketers who are
    unsure of the value of vouchers or invitations to in-store events – we can confirm that a significant number of people regularly visit a
    store or use a voucher as a result of an email (see page 38).

         In your experience, how well do you feel consumers respond to the following types of direct marketing email? Base: 216


Offers & promotions      4%       14%         5%                          47%                                  30%



         Newsletters 2%         14%           12%                               50%                               22%



         News alerts            18%                     23%                            41%                           18%


                                                                                                                                Businesses don’t
           Vouchers        8%           16%                        32%                           29%                  15%       know / aren't sure
                                                                                                                                how well
                                                                                                                                customers receive
Invitations to instore                                                                                                          invitations (39%)
                          5%           20%                               39%                           22%            15%
        eventsevents                                                                                                            or vouchers (32%)


   Market Research        5%                 30%                    14%                          41%                    10%



         Information 3%               21%              9%                                  60%                             8%


                               Very badly          Not very well     Don't know / unsure         Fairly well   Extremely well




                                                                               68
                    What (if anything) is bad about email direct marketing?
                 Where do you feel it under-performs as a marketing tool today?
                                       In their own words…
Not surprisingly, the overwhelming negative about email direct marketing was spam. Over and over again, experienced marketers
voiced their concern that their carefully crafted message would be considered as spam or be drowned in a sea of spam.
Being ignored by the consumer, being blocked by the email service provider, cluttered inboxes and consumer irritation are all valid
points as to why the medium of emailing has its bad press. Below are comments from some marketers who have given their analysis of
the causes and potential solutions to these.

“Has to be sent at right time with right message or can be detrimental to brand and message”
“Slow in older group and teens”
“Non-specialists think they can do it (everyone emails!); needs more thought than expected (because everyone fires off daily
emails with little thought); understanding good & bad creative, understanding good & bad results (& how to improve them)"
"Too many businesses do it badly!!!"
"Lots of hollow promises, mostly ignored or deleted, too expensive in relation to performance."
"Ability to cut through a cluttered marketplace, where the volume of emails received is increasing daily and the spam filters
are getting ever more zealous."
"Needs a great deal of behind the scenes business integration to maximise its usefulness."
"Many people’s perception of 'email DM' are jaundiced by 'spam'. I cannot believe how otherwise intelligent professionals
cannot seem to tell the difference between the two and end up considering it one in the same thing. Spam (and its effects) is
the no.1 obstacle to progressing email DM. "
"Spam appears to be quite a threat. It's a constant battle to get emails to recipients without them being identified as spam."
"Intrusive, irrelevant, badly targeted, too much text"
"The more segmentation you carry out, the trickier the creative management can become"
Learning Points
Do…
       properly target your message
       test, test, test to find out what works for your product or service
       learn as much about the finer points of the medium as you can
Don’t…
       send out copious amounts of emails to your customers




                                                                      69
                           Where can email direct marketing generate sales?


Respondents confirm our findings that consumers are likely to visit a store as a result of a direct marketing email that they receive, with
over three quarters agreeing that emails are not only useful for the obvious goal of generating clickthroughs to online purchases – they
can also produce traditional sales.



            Do you think direct email marketing is only useful for online sales or can it encourage sales through traditional
            channels also? Base: 110


                                                                                  Works for
                                                I don’t know,                    online sales
                                                     18%                             only
                                                                                      5%




                                                                                                Works for
                                                                                                online and
                                                                                                traditional
                                                                                                   sales
                                                                                                    76%




                                                                   70
                                                              What are the best sources of data for email campaigns?

Naturally, the most valuable source of data is found to be your own website – the place where you capture people who have a
demonstrated interest in your product or service. When you need to contact people beyond the limits of your own database, the leading
sources are list rental from data owners and data brokers and third party websites.

                    Where do you find the contact addresses that you send direct marketing                                                       Why do you say this? Base: 90
                    emails to? / Which one of these sources is of most value to your
                    company? Base: 90                                                                                                         Already
                                                                                                                                            demonstrated                             31%
                                                                                                                                              interest
  82%
                                                                                                                                                   Other                           28%


                              39% of respondents use                                                                                            Higher
                              another company to capture
  58%                                                                                                                                          customer                      15%
                              contact addresses
                                                                                                                                              acquisition


                              40%                                                                      All sources                              Accurate               10%

                                             32%                                                       Most valuable source
                                                                  31%
                                                                                    24%                                                       Experience               10%
                                                                                                    19%         19%      18%
                                                                                                                13%
                                                                   8%                                                     7%                     Larger
                                                                                     5%                                                                            9%
                              3%              3%                                                     2%                              2%          volume
                                                                                                    Data in-




                                                                                                                Other
Own




                                Data



                                                Data




                                                                                                       store
                                                                                                     In-store
                                                                                     Paper
                    website




                                             brokers




                                                                                                                            survey
                                                                                    survey
                                                                 Third party




                                                                                                                                     None
                                                                                                                                     None
        company




                                                                   websites
                              owners




                                                                                                                                                Easier to
                                                                                                                        Telephone
                                               Data brokers




                                                                                     Paper survey
                               Data owners




                                                                                                                Other



                                                                                                                         Telephone
      Own website




                                                                    Other website




                                                                                                                           survey


                                                                                                                                                                  7%
                                                                                                                                                 target


                                                                                                                                              Don’t know     3%




                                                                                                                             71
                                                           Data maintenance and campaign tracking


Cleaning your data is fundamental to email marketing: failure to handle unsubscribers promptly or remove dead and incorrect records
not only affects your reputation with your data and with the ISPs, and hence the deliverability of your campaigns – it also damages the
online direct marketing industry as a whole. Bearing this mind, it’s astonishing to find that 29% of companies clean their data only on an
ad hoc basis, or on a monthly basis or less frequently.
Looking at the habits of marketers in analysing the open and click rates for their campaigns, another missed opportunity emerges. Just
43% of respondents track and investigate every campaign, with the remainder sadly losing out on chances to learn what works well and
what falls short of the mark in some or all of their email broadcasts.
How frequently is your data cleaned? By cleaning we mean the removal of                                                 Do you investigate the number and type of people that
unsubscribers, incorrect or dead email addresses Base: 83                                                               open and click on links in your direct marketing email
                                                                                                                        campaigns to help determine future marketing
   39%                                                                                                                  campaigns? Base: 60


                                                                                                                           Yes, for
                                                                                                                            every                                    43%
                                                                                                                          campaign

                 19%            18%
                                                                                                                            Yes,
                                                                                                                                                                   40%
                                                                                                                         sometimes
                                                                                                           10%

                                                  5%          5%        4%
                                                                                1%            0%
                                                                                                                          No, never           12%
 Automatically




                                                                                Six monthly
                 Ad hoc basis




                                                                                              Bi-monthly
                                                  Weekly



                                                              Monthly




                                                                                                           Don’t know
                                every campaign




                                                                        Never
                                 Manually after
  after every
   campaign




                                                                                                                        I don’t know     5%




                                                                                              72
                       How do marketers broadcast their email campaigns?
Over half of the respondents outsource their campaigns at least some of the time, with a quarter using an external provider for all their
broadcasts. Application Service Provision (ASP) is a popular solution both for those who broadcast in-house and those who outsource.


 Do you outsource your email direct marketing campaigns or                   When you broadcast your own campaigns in-house, what
 do you broadcast campaigns in-house? Base: 83                               technology do you use? Base: 60
                                                                                                              None of
                               I don't                                                         Other 7%
                                                                                                             these 7%
                              know 2%
        Both 27%

                                         Outsource                                                                       Own
                                            25%                                                                       technology
                                                                                ASP                                       43%
                                                                              solution
                                                                                43%

     In-house
        46%

                                       And when you outsource your email direct marketing
                                       campaigns, what technology is used for the broadcast?
                                       Base: 43
                                                                           I don't
                                                Other 5%                 know 33%



                                           ASP
                                         solution
                                           23%

                                                                                 Managed
                                                                                service 39%




                                                                  73
                                                  Overall conclusion


After gathering the opinions of both consumers and marketing professionals, our assessment is that the online direct marketing
medium and online retail are in rude health and set to continue flourishing in the years ahead.

The problem of spam is on everyone’s minds, yet it seems that the perception is worse than the reality. Spam filters are largely
effective in blocking nuisance emails, whilst allowing the majority of legitimate broadcasts to reach recipients. And, by taking care
and following a few simple guidelines, marketers can be confident that their emails will be welcomed in the inbox – and will work
to foster relationships with customers and generate sales.

Perhaps the single most important finding from our research was the way that online direct marketing interacts with traditional
channels. Rather than being seen in isolation, email should be seen as a way to enhance other marketing activities, and its
power to drive physical traffic to stores as well as encouraging clicks to buy online should not be underestimated.

Online direct marketing is fast, flexible and highly cost-effective, and its potential is limited only by the imaginations of the
marketers who use it. We look forward to helping our clients to benefit from ever more creative approaches to the use of email
over the years to come!




   IPT and Tpoll would like to express our sincere thanks to all those who took part in this research.




                                                                 74
                                                                                               Tpoll
                                                                                               Market Intelligence




                          © IPT and Tpoll Market Intelligence 2007
The contents of this document remain the copyright of IPT and Tpoll Market Intelligence Ltd.
      It is not to be used by or released to any other party without written permission

       To gain permission please contact Rick Eastman: rick.eastman@ipt-ltd.co.uk

				
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