Email continues to play a strong role in marketing campaigns, but improvements are still in high demand.
Posted Dec 26, 2007
Technology and market research company Forrester Research released its latest evaluation of the top email marketing service providers. After sifting through most of the email vendors in the industry, only eight fit the strict criteria to match the needs of Forrester's client base. Evaluations were made based on various factors that fall under three broader categories: current offering, strategy, and market presence.
Conducted every 18 to 24 months, "The Forrester Wave: Email Marketing Service Providers, Q4 2007" is an evaluation of those Forrester deems are the top players with the following qualifications:
Evaluations were made through vendor surveys, product demonstrations, and customer reference calls, as well as an online survey of vendor-supplied references, according to the report. Forrester also provides a more in-depth look into each vendor's capabilities with a tool that allows clients to fill in their own selection criteria in order to select the vendor that best fits their unique needs (the tool can be downloaded from Forrester's site).
In a survey of 235 marketers conducted by Forrester, 62 percent believed marketing effectiveness would increase for email in the next three years. Another Forrester study showed that of 93 interactive marketers, 83 percent are currently using email, compared to the 17 percent who had no plans to use email, expecting to pilot, or are piloting. "Marketers continue to see very solid returns from their email businesses," says Julie Katz, an analyst at Forrester Research and author of the report.
As the email service providers work to maintain their status, competition is going to be fierce. Responsys, one of the leaders in the industry, attributes its competitive edge to a constant drive for product innovation, says Scott Olrich, chief marketing officer for Responsys. "We're moving beyond [being] just an email service provider to really being an on-demand marketing platform for the entire marketing lifecycle," he says. Responsys also seeks to improve its campaign management and marketing process management with a strong focus on campaign automation. Indeed, Katz observed that many of the vendors were in fact moving into other spaces such as mobile and RSS feeds.
- at least 25 percent of its clients are enterprise-level ($1 billion in annual revenue);
- earn at least $25 million in annual revenue from email;
- have a direct relationship with the client;
- are application service providers (ASP); and
- have primary ownership of their platform.
However, Katz does believe that even companies as sophisticated as the vendors included in the study have a long way to go before email marketing reaches its full potential -- "especially in the face of newer, more sexy marketing technology," she says. Marketers, Katz advises, need to consistently and constantly look at their data to ensure that it is not only clean, but also relevant. Here, segmentation and analytics play a crucial role. "Look closely at the data you have -- not just simple open and click-through rates, but looking at [those] rates over time," Katz says. "Analytics is a huge part of how email marketers can become more sophisticated and understand where their budget is going, and the effect of their programs, better."
The future of email marketing, and marketing as a whole, depends on multichannel integration. "Marketers need to get over their fear of integration," Katz says, addressing the concern that the time and energy required to implement such a system is often very daunting. "I think multichannel organization will become more standard, but there's going to be a lot of work that needs to happen before integration can go smoothly," she says.
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