Email Industry: Three Trends to Spotlight for 2011

Email Industry

Email Industry: Three Trends to Spotlight for 2011

Every business trend originates because a collection of companies has successfully developed a solution to a core business issue. For most of these trends, there is an “a-ha” moment, after which they lose their “trendiness” and become more established practices. Subsequently, each company is evaluated on its merits. The email ecosystem is no different. Future trends in our industry shouldn’t surprise as we adapt to more salient strategies and enhanced technologies. One thing is for certain: marketers and enterprise senders will deliver better value in “real-time” to their customer base in 2011. I see three specific trends that show where email is headed in 2011. These trends involve (1) delivering real-time value in a real-time marketing world, (2) ESPs becoming a more valuable resource by judiciously differentiating themselves in specific verticals, and (3) maturing ESPs morphing and/or buying into marketing-automation companies.

Trend A: Delivering Real-Time Value in a Real-Time Marketing World

Marketing automation will no longer be reserved for the B2B channel. The new de facto buzzword for 2011 in email circles will be real-time marketing. This concept involves not only delivering more than the archaic mantra of “right message at the right-time,” but also delivering real-time value through the right channel, whether it is the social behemoths of Twitter and Facebook, or email, or mobile. The liquidity of data for real-time marketing will make predictive analytics obsolete and give way to a new term, which I like to call real-time analytics. These analytics give insights to each and every status update you post and will cleverly enhance real-time marketing value. You can see a glimpse of this innovation now with real-time insights on every Facebook page post.

What data will be essential for effective real-time communication? Current data points on each subscriber will rapidly change and become even more (or less) significant, given this real-time world, as marketers seek to instantly respond and leverage messaging on social media status updates and check-ins, all in real-time. With the new emphasis on real-time, reliable benchmarking within the email industry will become further convoluted. Opens and CTR become less meaningful, since marketers must react to what their subscribers are doing, at this instant. The question then becomes, how do we deliver real-time value, for those subscribers that granted us permission to connect? What message will resonate most powerfully now? Which real-time channel will pay the most dividends? Preference centers will become even increasingly important, as marketers become more aware of real-time behavior and must react instantly to check-ins. How will we deal with the effectiveness of ever changing/evolving data, storing it in real-time, and accessing that data so that it is available for other marketing channels instantaneously? The trend toward real-time marketing gives us many interesting questions to ponder as we head into 2011.

Trend B: ESPs Establishing Niche Verticals

In order for Email Service Providers to have a competitive advantage in 2011 and beyond and avoid fierce competition among themselves, they will have to transform and develop the unique ability to reinvent themselves. Mature players in the field, such as Responsys, and E-Dialogue as well as MailChimp, Fishbowl and Constant Contact, have already carved out niche markets. For example, Responsys serves high-end marketers with a minimum list size of 500K (give or take), while E-Dialogue serves many clients within the sports industry, including and Fox Sports as “A” list clients, although they have others in many other industry verticals. The point is, in 2011, maturing ESPs can separate and gain a competitive advantage by serving and targeting a specific niche market. For instance, Fishbowl predominantly serves the restaurant industry and represents hundreds of restaurant chains. Once a certain ESP has established such a niche market, it becomes challenging for other ESPs to trespass, especially when the niche market ESP offers world-class service to its customers. The sooner ESPs can define who they are, what they do, and who they serve, the better prepared they are stake their claim among the elite. MailChimp, AWEBER, and Constant Contact, among many others, are home to SMBs. If you run an ESP, a clear definition of who your target customers are will reap its own (significant) rewards.

Trend C: Marketing Automation

As Steve Woods eloquently describes in this interview, The Second Wave of Marketing Automation, there is no doubt that the hot money is moving toward Marketing Automation–and fast. In the B2B market, marketing automation vendors such as Aprimo, Eloqua, Marketo, Unica, Manticore Technology, and Pardot are reaping the benefits, and are growing far more quickly than traditional ESPs. And as mentioned before, marketing automation is no longer relegated to the B2B space. And with the recent spate of funding in this segment, along with IBM’s buyout of Unica last quarter, marketing automation is poised for continued strong growth in 2011. In fact, the lines are blurring so rapidly between the B2B and B2C segments, that we may soon see the two merge, which would give rise to B2P (Business to Person), to use the term coined by ExactTarget in its “one-to-one” marketing campaign. The marketing automation software industry continues to segment, as Eloqua and Marketo seem to go after the enterprise market, while Pardot and others are better suited for the SMBs. As this industry matures, large ESPs will look to acquire this technology and find the right fit. To reiterate, these companies are also defining themselves early and often.

Clearly, marketing automation has a steady tailwind at its back. However, most of their growth and potential is due to the headwinds created by ESPs. I’ve always said that Email Service Providers form the backbone of this industry, and they come in different shapes and sizes. Some call themselves ESPs, while others prefer the term marketing automation companies. Whichever name you use, in 2011, you will have to find your niche vertical within this quickly developing industry. Retailers and senders today are increasingly savvy, and they want expert advice on delivering real-time value in a real-time marketing world. Whether you are able to deliver email in a timely manner is no longer their only concern. Additionally, they will demand professional advice on sound automated cadence, all with real-world industry specific referrals.

These trends give us a glimpse of what awaits us in the email industry in 2011. These are exciting times for our industry, and we must rise up to meet the challenges before us, and step into this brave new world characterized by real-time marketing, niche verticals, and marketing automation.

Fred Tabsharani
VP for Marketing
Port25 Solutions, Inc.
Twitter: @tabsharani

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