List Marketing: In Need of a Scrubbing

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ADOTAS – Let’s face it. The list marketing industry could use a good scrubbing. Most of the “dirt,” in fact, lies in list rentals specifically, which is rife with seedy practices and ancient information that ultimately yield an unhealthy environment for everyone involved — whether the advertiser, the recipient, the list owner or even the ISP. These practices promise to drive the industry into the ground unless good data hygiene is adopted industry-wide.

A Vicious Cycle That Sullies the Industry

When advertisers decide on a list rental, they often pay an outside vendor as much as a $500 cpm, or cost per thousand impressions, to reach what they expect to be their target audience.

Depending on how targeted or “clean” the list actually is, this type of campaign could reap great ROI for the advertiser. In many cases, however, list may contain invalid e-mail addresses for people who have moved on from their e-mail addresses or switched jobs. Likewise, some of these addresses may be to a secondary account set up by the user to avoid unwanted e-mails . Worse, some vendors’ lists are comprised of addresses that have been acquired without the recipient’s permission.

As a result, once leveraged, these “bad” lists set in motion a number of undesired results, ranging from hard bounces (in the case of invalid e-mail addresses), e-mails that are never opened (in the case of the secondary account) or abuse allegations from angered recipients (in the case of non-permission-based e-mail. This scenario is especially dangerous, as it may even besmirch the advertiser’s reputation.). Ultimately, the advertiser’s ROI is never realized.

The vicious cycle is perpetuated with every campaign, until the advertiser’s frustration builds to a point that it withdraws from the industry altogether, opting instead to spend marketing dollars on more reputable lead-generation tactics such as search engine marketing or display advertising. As a result, the list marketing industry shrinks and eventually dies. With it goes incredible potential that could have been tapped if only best data hygiene practices had been used.

Clean Data: The ‘Holy Grail’ Is Within Reach

According to Dr. Charles Stryker, longtime industry veteran and founder/CEO of Venture Development Center, the quest for clean data is not new, and the tools for lead generation using clean data are available if advertisers are judicious about who they work with.

“Clean data has been the Holy Grail since the information industry was formed some 40 years ago,” said Dr. Stryker. “It has been an elusive goal, and with the digital revolution, the solutions become even more complex. Data accuracy is more important now, as we do have the ability to reach the right person, at the right time, with the right message. However, for improved marketing performance to be realized, we need clean data. We have faster processors, more storage and better analytics. But without clean data, the power of these available technologies is lost.”

Recent data from Harte-Hanks also supports this. According to its Postfuture Index, overall delivery rates across all industry sectors increased from 93% in 2009 to 95% in 2010, and bounce rates averaged only 5%, compared with 7% in 2009. The company attributes these numbers partly to maintaining clean data.

Advertisers can begin to set new industry standards for clean data by outsourcing to only trustworthy list-rental vendors. Specifically, they should look for list owners that offer permission-based lists, so the recipients will be more likely targets.

Alternately, advertisers can contract with a self-service lead-generation platform like Marketfish. Often, companies like this offer the best data hygiene practices, and their offerings are augmented by partnering with companies like LeadSpend, which removes bad or invalid e-mail addresses; and impressionwise, which removes non-permissioned addresses and spam traps. (Additionally, clients of these companies get the added bonus of more targeted results.) Making sure records are clean before a campaign is executed means a higher level of in-box delivery and increased open-and-click rates.

All is not lost, but to save the list marketing industry, both advertisers and vendors must act now by demanding cleaner lists and by committing to the cleanest data practices possible. Maintaining these practices will perhaps, hopefully, return the list marketing industry to its former luster.

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