Getting To Know You - Post Communications offers e-mail marketing campaigns - Company Business and Marketing

Industry Standard, The, Dec, 2000 by Patricia King

When Dawn Griffin bought a briefcase from eBags.com in May, she was delighted to learn that she could get a 10 percent discount. All she had to do was answer a few questions. She provided her e-mail address, checked off "business" and "travel" to describe her interests, and indicated that she would welcome special offers and promotions.

Talk about opening the floodgates. Soon after she answered the survey, Griffin began receiving personalized e-mail from eBags proposing more discounts if only she'd respond to more surveys. In July she got 10 percent off a black summer purse decorated with daisies by answering a questionnaire that asked which kind of rewards -- frequent flier miles, product discounts or product warranties -- she would prefer when shopping at eBags. The 27-year-old human resources manager, who lives in suburban Atlanta, says she doesn't mind completing surveys to get discounts, and she's not worried about her privacy. In fact, she likes receiving the e-mail. "If I can't sleep in the middle of the night, I can jump on the Internet. I like that I'm greeted with, 'Welcome back, Dawn. Remember you bought this?"'

Griffin's e-mail is officially from eBags, but in fact it comes courtesy of Post Communications, a San Francisco company that provides e-mail marketing campaigns for online retailers. Post sends an estimated 75 million e-mail messages each month on behalf of its clients, who range from Victoria's Secret to Wells Fargo Bank. The company's goal, says Post founder Hans Peter Brondmo, is to create e-mail that customers are so eager to get that "they send you e-mail asking where it is" when they don't receive it.

That may be asking a lot, though Brondmo doesn't mind pushing the limit. Friendly "Dear Dawn" e-mail has been a gold mine for him. In four years he built Post into a $380 million company that he sold in April to Netcentives -- a firm that provides clients with customized rewards programs to entice and retain online customers. Brondmo chose to stay on at Netcentives to handle corporate strategy, which includes figuring out how to marry the two companies.

His new book, The Eng@ged Customer, lays out strategies for companies to communicate with their customers via e-mail. He's clearly on to something. Jupiter Communications forecasts that e-mail marketing will leap from $164 million in 1999 to $7.3 billion in 2005. And the number of e-mail marketing messages is expected to climb from 3 billion in 1999 to a staggering 268 billion in 2005.

These days Brondmo is something of a "next-generation evangelist" for one-to-one marketing, also known as personalization. The term personalization usually refers to software that enables a company to build individual profiles of its customers, communicate personalized information about products and services, and offer them discounts or other incentives. The idea behind personalization is that customers will buy more and stay on your Web site longer if you offer exactly what they're interested in rather than deluge them with information that doesn't correspond to their needs, tastes or lifestyles. "Treating every customer like a first-time buyer is more than just a bad idea," says Brondmo. "It's a terrible waste of money." Personalization is what triggers a pop-up ad for a recently reissued Louis Armstrong and Ella Fitzgerald recording when you're checking out an Armstrong CD online. Personalization also makes it possible for unsolicited information on fitness to be sent to your e-mail box, thanks to collabo rative filtering software that uses algorithms to guess that, as a woman living in an upscale ZIP code, you exercise a lot.

At its most ambitious, personalization involves collecting trillions of bytes of data on consumers' buying habits. The goal is to update customer profiles constantly and in real time. So, for instance, the minute you arrive at an online drugstore for the first time, the e-tailer offers you a deal on Prozac because your profile indicates that you take the drug.

When personalization first came on the scene five years ago, it was heralded as the Next New Thing. Today it's as essential to e-commerce sites as cardboard cartons and bubble wrap. Big, deep-pocket e-tailers like Amazon.com, Drugstore.com and Priceline.com have gone personal, partnering with companies like Net Perceptions and Engage to offer recommendations and incentives that appear on screen while you shop. Some companies are more successful than others at implementing the new marketing tools.

In 1997 Andrea Butter, former VP of marketing at Palm Inc., was desperate to find a way to keep in touch with Palm's customers electronically. When Butter discovered Brondmo, it was "one of those 'Aha!' moments," she says. Under Post's guidance, Palm asked its customers what kind of information they wanted to receive about the device. Some wanted info about new styles; others wanted tips on navigating their Palm. The company was able to satisfy them all, and customers were grateful to receive only what they asked for.