Five Keys to Selecting an Email Delivery Partner

"Over 94% of marketers are using or going to use email marketing by year's end." So says the October 2006 Forrester report, "Email Marketing Landscape." According to the same report, over 58 percent of companies interviewed indicated they deliver email using a variety of email services -- 31 percent through full service agencies and 28 percent through Application Service Providers (ASPs, or more intimately known as ESPs to this space, meaning Email Service Providers). Only 15 percent indicated they use internal technology to service their email marketing needs.

In a former column entitled "How To Evaluate E-Mail Vendors," I suggested several functional capabilities you should look for in a vendor. This really is a hot topic these days. When my company audits email programs, most clients we talk to are questioning the value they are getting in their service relationships both internally and externally. My team has seen five RFPs this year alone for selecting ESPs. The business requirements look unmistakably similar across every company, but when you look underneath the requirements into what they really want, these are quite often not reflected in the RFPs.

Here are five critical questions you need to ask yourself before engaging in this effort.

1. What type of service do you need? While the analysts will categorize the ESPs into full service, self service and a hybrid service, this can be confusing. What if you want to use a full service vendor, where they do everything for you, and then grow a team internally and ultimately do it all yourself? Does that exclude the selection of partners that tout full service only? Does it exclude self-service only companies from solving your "today" problems? I know two ESPs that have been slotted into these arbitrary analyst categories as self service only, when in fact they do provide the classic full service capabilities. Then there is a well-known ESP that is listed as full service only by analysts, and ironically a large part of their business is self-managed by their clients.

I prefer to classify ESPs in the following way: "The Fat and Content", "The Hungry" and "The Starving". What's my rationale? The success of any partnership is in the willingness and flexibility to match needs to solutions, and this is in direct alignment with the availability of resources to priorities. So, the technology might fit, the relevant experience may fit, but they may be too rigid to make you successful. While I love analyst reports and quote them quite often, take them with a grain of salt when selecting your list of potential suppliers. Some of the best sources are industry networks. The Email Experience Council is one that is emerging, and there are several "insider" lists that offer opportunities for clients to discuss experiences and refer good partners, and will likely get you higher level contacts in these potential partners. See my Blog for list details.

2. How much flexibility do you have with budget and contracting? During your selection process, don't wait till the final selection to discuss terms and options available. There may be more flexibility than you think in negotiating contracts, but many companies have done RFPs to only find themselves stuck in a swirl of contract negotiations at a late stage because extra charges popped up or SLA's didn't meet the IT department's requirements. Be sure to disclose any specifics about contracting requirements before hand. The easiest way to mitigate this is to do "pilots" which will give you a basic review of the contracting process and the flexibility of your organization, and select partners in getting this done in a short period of time. It can be difficult for some companies but the success of a pilot program is usually a good "tell" as to their willingness to work with you.

With the consolidation and crowded space we have today, contracting can get hairy with larger companies. Consider this when reviewing partners, as you may not get the SLA you are looking for or an adequate support clause. I know firsthand of five email technologies that have had various levels of failure in the last two years. Are you prepared to handle this? And how much of this can and needs to be in a contract? If there is commercial value to your email, then I'd consider strongly the effect of any system failure and subsequent recourse. This will save you headache and internal embarrassment.

3. How much integration do you really need? Everyone wants a symbiotic relationship between data and syndication and the "perfect storm" for eCRM is out there – I just haven't seen it yet. But understanding what is critical to business success and what is a "nice to have" and the trade-offs is critical. The RFP process can be a great opportunity to validate your requirements by forcing partners to come up with prioritized approaches to helping you solve problems. If you get cookie-cutter approaches that aren't somewhat customized to your issues, you have either not given enough detail to your needs, they haven't done their due diligence or you have reached the RFP machine at the ESP, responding with the same response they give to everybody. You should remember that everyone is asking these same things, so without a good "setup" of the RFP process you are likely to get very generic approaches to pricing and implementation.

4. How do I transition from one vendor to another effectively and efficiently? This is a critical situation. Change management is tough. And yes, that's what is involved. You will likely change some of your processes, train new people and begin to work with new technology and support teams. This shouldn't be taken lightly. In the final analysis, this could be the most expensive aspect of the whole effort. First of all, you have to budget for this transition, don't expect the partner to absorb these costs. If you don't have the budget and intestinal fortitude for this type of effort, it's wise to reconsider why you are switching providers. Secondly, be clear about the details of this change in your RFP and expect your future partner to give you a plan for this transition so it does not affect your operation and delivery performance. There should be a clear ROI for this transition, if not, you'll always think it's too expensive and takes too long.

5. What type of partnership do you want? The number one reason I hear why people are changing ESPs is they don't feel they are getting the value they deserve. Is this the ESP's fault if you are paying $3CPMs, and you scrutinize every service fee associated with email campaigns? The quality of the people working on your account is directly correlated to the budget you've allocated to it. It's different if you are delivering 1B message a year, but if you are a $20K per annum account, don't expect their top consultant to hold your hand. Secondly, watch for the "switch." That's when you buy the person pitching you and you end up with a distant cousin who has less than a year doing email. In the agency world, the client wants to meet the team they will be working with and that is what you are contracting for. Be clear about roles, the value they will add and the relative costs. Be wary of anyone that will throw-in this or that value-added service -- it usually doesn't materialize. But most importantly both the partner and client should be realistic about this relationship and the keys to success. The clearer those success metrics are the easier it is to keep a scorecard as to performance.

The RFP process can be simple or very painful depending on your budget, resources and company culture. The transition can be even more painful, but don't be an ostrich; you'd do yourself a disserve if you didn't pull your head up out of the sand and look around every year to see what new technologies and suppliers are doing. Trade shows don't provide enough of a view by themselves, you have to out some effort into this.

Good Sources

Forester Wave Report  
This is a good reference, albeit biased as they didn't include all potential vendors in categories. Be wary of reports that exclude partners due to their relationships with the analysts. While I value their "clinical" view of technologies and how they rank and score features, this is difficult to do in this space since the success of the technology, unlike other platforms, is dependant on the service support, so features can be discounted fairly easily.

Jupiter
Typically a good report, with quite a bit of detail about the capabilities and classification of vendors, but be sure to run them through your own tests, I found these reports to miss a few things after closer examination.

Good Industry Sources for Networking:

Bill McCloskey has a list called Inbox Insiders which is a network list of a lot of the top email marketers in the space.  If you’d like an introduction to the list, reply to me directly dbaker@whitenoiseinc.com and I’ll pass it on.

Another Insider List is in Yahoo Groups:  “Email Roundtable” and “EEC Roundtable”

Good BLOGS:  http://www.email-marketing-reports.com/blogs.htm