Because online marketing is one of the few industries experiencing growth and prosperity in the present economy, a growing number of entrepreneurs and online service providers are aiming to expand into providing email marketing services. This is an outstanding business opportunity, particularly for businesses who already offer internet- or marketing-related services to their clients. In this article we will briefly review the steps you need to take to succeed as an email marketing service provider.

Your business plan

The first step, of course, is to determine who your target market is and exactly what you will be offering them. There a full sections of library devoted to the topic of how to write a business plan, but the basic are simple:

• Market Analysis
  • Who will your customers be and what are their needs?
  • What is your competition like? What opportunitities exist and what barriers exist to realizing those opportunities? How do your particular strengths and weakness affect your chances of success?
• Product Development
  • In this case you know you intend to provide email marketing service. What does that include? Will you be building up your clients’ email lists for them? Writing advertising copy? Or will you simply be providing access to a web-based email marketing system that you will maintain?
  • You will also want to evaluate your costs, including man-hours, and develop a pricing scheme based on consideration of these figures, how much profit you need to justify your efforts, and what price you think your market will bear for the services you’re offering.
• Sales & Marketing
  • How do you intend to go about promoting your new service? Do you have an existing customer or subscriber base that you can leverage to get the service going?
  • Ordering & fulfillment logistics

Things You’ll Need

• Hardware
  • No matter what type of email marketing service you’ll be running, you will need to invest in a solid server & ISP or a hosting package that is capable of accommodating your projected usage volume.
• Software
  • You will need to buy bulk email marketing software with a sufficient number of user licenses to accommodate your projected initial needs (the order page is here).
• Wetware
  • You will need to effectively market your service. If you have an existing client base and are offering the service to them as a way to add value or expand upon your existing services, then you definitely have a huge advantage here. Otherwise, you will have trouble competing with major service providers like ConstantContact and AWeber unless you find a specific niche or untapped client base. As with any other type of business planning, this is where your ability to exercise some serious ingenuity comes in.

There are three basic types of email marketing services, representing three fundamental approaches to email marketing. This is why it is misleading to lump the different types of products and services together, and why it is so easy to become confused about what works and what doesn’t.

In this article we will break down all of the different types of email marketing service, explain the assumptions that they operate under, and look at the reasons why they are or are not effective.

1. Spamming

When a lot of people think about email marketing, they imagine getting in contact with an email marketing firm that maintains a massive “opt-in” list. They imagine that this firm has a secret ingredient that makes millions of people open to the idea of receiving marketing messages from anyone willing to pay.

This first type of email marketing service is what we refer to as “spam,” and it basically means you are hiring someone to send out junk mail to a random list of email addresses for you. The return on investment with this type of service is going to be extremely low, because the people who are receiving your marketing emails will generally wish that they were not receiving them.

2. Email Advertising

The next type, which we’ll call email advertising, is the much more legitimate and reliable cousin of spamming. This is generally done through real and reputable marketing firms, who will set up advertising contracts to place your marketing messages inside of emails sent by publishers to established mailing lists.

For example, say you subscribe to a magazine that sends you a weekly update by email. You may have noticed that there are advertisements in those emails just as there are advertisements in the magazine itself. This is an email advertisement.

Because the people receiving this type of message are generally doing so by choice, it is much more likely that your sales message will be seen and paid attention to. The effectiveness of your ads will probably be comparable to purchasing space in a printed publication (although may be less costly.) And, of course, the effectiveness will depend on the design of your ad, the value of your offer, and your placement within the email message.

3. Classic Opt-In Email Marketing

Generally when you hear discussions about reputable email marketing practices, it is this type of email marketing that is being referred to. A special, separate email list is maintain specifically and only for your business or marketing campaign, and individuals opt in to receive the messages that you intend for that list. Generally you will build your email list by offering some sort of incentive for signing up, be it information, special offers, or giveaways.

This form of email marketing is highly effective and is growing in popularity among traditional marketing experts, particularly because the troubled economy calls for marketing techniques that require little upfront investment. In fact, opt-in email marketing appears to be getting more effective.

In order to accomplish this type of email marketing, you will need to plan your email campaign, build your opt-in email list, and write effectively.

This is one of the most common questions that we hear from individuals who are new to email marketing: where can I buy an email marketing list and how much will it cost?

The common assumption is that the sequence of an email marketing campaign goes something like this:

1. Develop a pitch
2. Buy a supposedly “opt-in” mailing list (yeah right)
3. Send the pitch out to that list
4. Watch the sales roll in!

Every year thousands of companies follow this ill-conceived plan and fail miserably, because it simply is not an effective strategy. And then from that point on, they assume that email marketing simply doesn’t work, or at least doesn’t work for their product. But email marketing can be extraordinarily effective if you use a more sensible approach to planning your email campaigns.

The real question here should be: is there any point in buying an email marketing list? Personally, I wouldn’t purchase an email list at any cost. You can buy millions of email addresses from web scrapers and spam brokers, but it’ll end up costing you more than it makes you. If it makes you any money at all, which would surprise me.

I’ll ask you this question: when was the last time you received an unsolicited email that resulted in your doing business with that seller?

More likely, the fact that you received an unsolicited email made you less likely to ever deal with that company. The email tarnished their reputation. In your mind, and the minds of all the other millions of recipients of their spam, the company that sent you the unsolicited email is now on the same level as the Nigerian princes who keep offering you a percentage of their untold millions. So the only reason you should ever buy an email marketing list and send your own marketing information out to it is if you feel like spending money to damage your own reputation.

Instead, take the time to build up your own, fully qualified and unique email marketing list. You will find that people who have actually personally opted in to your own one-of-a-kind list will often be surprisingly responsive and engaged. Design an attractive email marketing subscription form, place it prominently on your web pages, and consider offering a compelling incentive for signing up. That’s how to succeed in email marketing.

We recently received a comment that exemplifies a lot of the fears that beginning email marketers have:

Hi,

If I do use software such as 1-2-All, isn’t my IP being shown to my ISP as sending out many, many emails. Won’t I therefore be shut down? I need to send out about 250 per day. I know that legally a spammer must attempt to hide his identity and (not or) be deceptive. I want to do neither, in fact my letterhead includes name, address, phone, email, etc. in every email. I am hardly a spammer. However, the ISP’s think that any email sent out from a hitherto unknown sender is spam. Perhaps socially yes, legally no. Regardless of the legal innocence of my actions, I need to get the word out. How do I do it?

Your response will be greatly appreciated.

Frank

Thank you for your excellent question, Frank. I hope this answer will clear things up for you.

You are correct that many ISPs will assume you are spamming if you start sending out a large volume of emails through your normal SMTP email server. It is generally not recommended, for example, to start sending large volume email advertisements through your Comcast, Time Warner, AOL, or similar email account, because doing so may jeopardize your ability to continue using the account normally for your own personal email. At the very least, you should check the terms of use before even considering using your primary email service for bulk email sending.

By default, ActiveCampaign Email Marketing software will send your messages directly from your web server. Depending on which web hosting company you use, this is often considered more acceptable use of your service. However, there will usually be limitations to the number of messages you can send. Many web hosts will limit you to 250, 500, or 1000 messages per day.

It is important to contact your web host prior to starting an email marketing campaign to find out what the limitations of your service are. You can easily configure our software to throttle its sending rate so that you do not exceed your account limits. The reason you need to do this first is because many servers will not report any error when failing to send messages beyond your quota, so it won’t be possible to go back and determine who did or did not receive your message.

Many web hosts also have additional packages available for purchase which will allow you to send a greater number of emails more quickly. If you are using a quality web host, then this will often be a very solid option for sending out your email campaigns.