You've got mail (still)

India, Jan. 10 -- Social media emerging as a better medium for digital marketing but it may not wipe off email marketing

BY Rahul Sharma

Delhi

Spam, once a popular and somewhat notorious medium for marketing in the cyber world, is today facing stiff competition from social media. Experts say that while spam would not fade out completely, marketeers will have to innovate and introduce creative content for email marketing to deliver results.

When Mark Zuckerberg, co-founder of world's biggest social networking website Facebook launched its messaging service in November, he spoke of the email meeting the same fate as the letter.

However, Zuckerberg's assumption seems exaggerated. At present, 247 billion emails travel across the globe daily. By 2013, this number will swell to 507 billion.

But the writing on the wall is clear. Social media has emerged as a bigger and better medium for online marketing compared with the email.

Of the total online advertising done in 2009-10, 11 per cent was done on social networking websites. This was revealed in a recent report by the Internet and Mobile Association of India or IAMAI. Email marketing accounted for 7 per cent of the total online advertising. And this figure is projected to drop to 6 per cent next year.

Even though the situation for email looks grim, experts still believe that the medium has a lot of potential. It is the right strategy which will deliver results.

"Nobody thought search advertising could be so huge, until Google came around," said Hitesh Oberoi, managing director and chief executive officer, Naukri.com. "What is required is out-of-the-box thinking and have content which stands out." One of the first few dot-coms in the Indian digital landscape, Naukri, today has around 24 million registered users and actively uses email to connect with job seekers and recruiters. So much so that it has found a way to monetise the mails although the revenue from this source are small. Naukri charges a fee from the client when it wishes to reach out to more people in its database.

Oberoi was speaking at the first email marketing roundtable organised in Delhi last week. Even on the chilly winter night, the hall was packed with people, mostly belonging to small and medium enterprises scouting for creative and cost-effective ways of reaching out to prospective consumers. "Digital marketing budgets in India are at about 10 per cent and email marketing gets a small part of that. What we are yet to see on a large scale is companies coming up with engaging creative work delivered through email," said Sandeep Lakhina, chief operating officer (South Asia), Starcom MediaVest Group.

He added that even though social media will grow faster, it is a personal space where corporate brand intrusion will be entertained to a limited extent and both social and email marketing will coexist. The non-intrusive nature of the email is perhaps its strong point.

According to the Direct Marketing Association report, even though the return on investment on email marketing has been declining. It stood at $43.62 in 2009 for every dollar spent. It was once $50 to $55 in early 2000. However, email still outperforms all other direct marketing channels. In India, besides financial services companies, which were among the first ones to use email to market to consumers, the email is spread across categories with online retail or e-commerce, travel and mobile companies at the fore. The most important factor that determines how effective an email campaign is the quality of database and the source of the mail. "It is also important to have a catchy subject line and ensure good service," said Salil Kumar, chief executive of BagItToday.com, the e-commerce portal of the India Today Group. The company has through active data mining created a "platinum database," which has worked very well for the company and resulted in 30 per cent growth in business.

Email still remains the number one reason for people in India to log on. This is closely followed by general information search, as per the I-Cube 2009-10 report brought out by IAMAI in partnership with the Indian Market Research Bureau.

"Marketers in India are still between Batch and Blast (where emails were sent to everyone on the mailing list) to Opt-in email marketing (where users indicate the kind of emails or updates they want to receive). However, we are seeing movement towards email marketing based on the profile and need of the consumer. Thus email marketing 2.0 will play a significant role in addressing Indian markets," said Kalpit Jain, business head, enterprise group, netCore Solutions.

Published by HT Syndication with permission from Tehelka.

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