A recent article by New York Times media columnist David Carr revealed a radical publishing technology catching on in news media companies everywhere: email newsletters.
Carr wrote that email is a marketing tool many people tend to forget about. But, he argued, email is the most consistent and useful medium for advertising.
Email and search drive ecommerce, which is one way to explain why Oracle, Salesforce and IBM have all bought email companies for billions of dollars. But in order to compete with nascent ad exchanges and programmatic practices, email needs a revamp.
Email marketing has primarily served first-party ads to first-party audiences, but programmatic email ad buying in third-party media is the new wave, said LiveIntent President Dave Hendricks.
LiveIntent runs a programmatic SaaS platform identical to an online display environment that enables the buying and selling of inventory in its clients’ email newsletters. The company will manage about $50 million in ad spend this year, according to Hendricks, which is more than double last year’s total managed budget.
For instance, Kraft, a LiveIntent client, sends out around 4 million emails across US marketplaces each week, targeting consumers through shared recipes and product promotions.
“Email is a critical channel for us in terms of consumer engagement,” said Kraft’s Associate Director Dana Shank. “We have an extremely high open rate. We do see that a large number of our customers want an aggregation of content. We’ve been working with our email marketing partners to make sure that we optimize from a mobile standpoint.”
Of course, as user engagement shifts from desktop to mobile, advertisers are working hard to apply cross-device strategies for optimized marketing. Programmatic email marketing might just help to solve the cross-device dilemma.
“The reason why email is interesting right now is because cookies don’t work across multiple devices, but email addresses do,” said Hendricks. “Email addresses are an amazing cross-device identifier. That’s why there’s a new and rapidly growing practice of email hash retargeting, or CRM retargeting.”
Hashing email is the process of taking an email address and converting it to a hexadecimal string. Every time an email address is run through a hashing algorithm, it produces an identical string, which can then be identified on other media platforms. If someone logs into Facebook, say, brands and others can bid via LiveIntent to serve that individual in-email ads in real time based on behaviors and preferences.
Facebook calls this process Custom Audiences. Twitter does the same thing, but named the offering Tailored Audiences. LiveIntent’s product is called LiveAudience, and Hendricks said it serves more than 500 publishers through programmatic email bidding.
“We believe this sort of CRM retargeting is going to be huge for every brand and every publisher,” said Hendricks. “The web is splitting into two camps: logged in and not logged in. And logged in is more valuable.”
Most premium publishers, like The New York Times, The Wall Street Journal and Ad Age have already enacted pay gates that are tied to login data, or, hashed emails. If used for email targeting, the hash opens up the ability for brands to access audiences and paid media using their CRM data. Other companies are also starting to catch on to the value of the hash. Reach Dynamics, Zeta, AdKnowlege, OpenX and Movable Ink are other major players in the new wave email marketing, although each exists in a specified field.
While LiveIntent’s angle is automating ads, Movable Ink takes a more brand-centric approach to real-time email marketing. For one, Moveable Ink does not operate an ad exchange. Instead, they provide a content optimization platform in first-party media. Simply put, their focus is on helping brands optimize their own content to deliver a real-time experience within email. The content of emails can change at the time they’re opened depending on data and demographics, said Moveable Ink CEO Vivek Sharma, explaining the strategy as “dynamic email marketing.”
“This kind of content can know the kind of device you’re on, it can know what day it is, it can know where you are and it can understand your recent behaviors,” he said. “Taking these signals, it can generate personalized content at the time an email is opened, not when it is sent.” For branding cross-device, the potential here is huge.
Imagine a user is passing by a storefront and checking their email as they walk. Advertisers could serve an ad to that user based on their proximity to the store. While the technology for targeting of this caliber exists, Hendricks said it has not yet been leveraged within the programmatic email environment. Should LiveIntent explore more hyper-local marketing techniques, he said, it’s a definite next-step possibility.
Yet the challenge, still, is selling the industry on the value of a long-forgotten medium. To do so, Sharma points to the figures.
“Email is the highest ROI digital marketing channel available to a brand,” he said. “On average, it’s about $30 return on investment for every dollar spent.”
“Three years ago, people were skeptical about the need for real time content in email marketing,” he concluded. “What we’ve seen is a 10x increase in the use of live content in email every eight months. On a given month we’re powering half a billion pieces of live content in emails.”
