Bill Kaplan of FreshAddress Discusses Counting Emails (And Counting Cards)
Bill Kaplan is CEO of FreshAddress, an email database services company located in Newton, Massachusetts. (My home town!) Bill generously shared his thoughts and advice on email best practices in the following email interview.
Bill Kaplan: FreshAddress is an email database services firm. We help companies and nonprofits “Build, Clean, & Update” their email address lists. We are the original developer and U.S. patent holder of Email Change of Address (ECOA) services, including the underlying consumer collection technology. Our other core offerings include B2C (consumer) email appending, B2B (business) email appending, reverse appending (i.e. matching name and postal to email address files), email list cleaning & hygiene, and real-time email address validation.
A: How did the firm get started?
B: Back in ’98, my partner, FreshAddress President Austin Bliss, had a problem — he was still in his twenties and he was losing touch with old friends and colleagues who had changed their email addresses! “What if you could link someone’s old email address with their current preferred email address,” Austin thought. “Then you could search on someone’s old, dead email address and reconnect with them through their new email address. How cool is that? ” young Austin thought. And so he developed the original ECOA technology to help people reconnect with each other through email.
A: How big a deal is ECOA for businesses and nonprofits? Can you quantify the dollar costs and dollar benefits of using a service like FreshAddress?
B: ECOA and its sister service, Email Appending (i.e. matching email addresses to customer postal files), have huge implications for businesses and nonprofits alike. Over 50 million people change their email addresses each year, which translates into a 30+% annual email address attrition rate for the vast majority of companies. Losing touch with 1/3 of your customer via email is no laughing matter. The net result is a substantial drain on revenues, which is often accompanied by an increase in marketing costs as companies try to make up the difference through other marketing channels. Email Appending serves a similar function in reverse. By allowing you to connect with your customers through email, you can maximize your e-commerce and store revenues by converting your single channel buyers into multi-channel buyers while reducing your overall marketing expenditures.
The cost for the above two services through FreshAddress is priced per guaranteed deliverable email address we return. Depending upon the specific service and the size of one’s input file, the cost per update is typically in the 10 to 50 cent range, often much less than the price of a stamp, which seems to keep going up every time you look.
A: Do you have a specific case study you can share?
B: Yes, we have many success stories with Fortune 1000 companies as well as nonprofits. One of our clients, a leading PC and peripherals manufacturer, was looking to drive revenues from their bouncing email address file. We ran an initial ECOA project a couple of years ago on a 3 million record undeliverable file for one of their divisions. The results were so dramatic that they’ve since run over 20 additional ECOA projects with us.
A: You folks are continually receiving and processing many email lists from many mailers. You see many, many email files. What are the top four problems you observe in your work, and what’s your advice on best practices for mailers to avoid them?
B: We have processed thousands of files with upwards of 1 billion email addresses for our clients. Of all the issues we do see, I’d say the top four concerns for email marketers are:
- Losing touch with customers due to invalid ro changing email addresses
- Building their email address lists safely and quickly
- Cleaning up outdated and inaccurate email addresses
- Improving their email deliverability by staying off of ISP’s blocklists and Internet blacklists
Our advice on best practices is to work only with the most experienced, sophisticated, and reputable email services providers. The email industry has yet to fully mature and is still littered with fly-by-night companies. The need to build, clean, and update one’s email address database is critical to the marketing success of every company. Your customer database is the most valuable asset you have. Tend to it properly and you will be justly rewarded.
A: As someone following the email industry closely, can you give us a few examples of multichannel retailers who you’d highlight as particularly effective and innovative with their email campaigns?
B: Successful multichannel retailers are effectively integrating their catalog, online, and store activities to attract and retain customers and to encourage more spending. L.L. Bean, Target, Hewlett Packard, West Marine, and Casual Male: all are examples of innovative retailers marketing on all cylinders, using catalogs to attract new customers and repeat business; the Web to offer convenience, product information, and promotions; and brick-and-mortar stores to allow customers to physically touch and try goods and services before purchasing them.
A: Looking ahead: where do you see email marketing heading over the next five years? Will spam kill email marketing dead? Will marketers over-mail the channel to the point that consumers ignore marketing emails? Will RSS topple email? Or will a technical or political fix “save” email? What are thoughts on where email is heading?
B: I think email has proven that it’s here to stay. Recent research has shown that despite all of the bad press and issues with spam, email might just be the most addictive drug right now on the planet. And that translates into billions of dollars for companies who can reach out to their customers and donors with relevant information, services, and products that will improve and simplify lives. Based on sheer volume, I might even say that email is more addictive than gambling.
A: Speaking of gambling, some might say that success in online marketing is something akin to card counting – you need to understand the rules of the game fully, you need to learn from previous experience, and it never hurts to be lucky. Beyond metaphor, you have some literal real-life card counting stories from your own past. Could you share some of those?
B: In a previous life, I co-founded and ran the MIT Blackjack Team, a group of eighty-odd card-counters we trained, whose exploits gained notoriety in the national bestseller, “Bringing Down the House.”
The craziest story from our ventures is probably when one of my partners (not Austin, one of my collaborators at MIT then) inadvertently left a brown paper lunch bag with over $125,000 in hundred dollar bills overnight in a classroom at MIT where we used to hold our training sessions for the players.
A: You misplaced $125,000 in cash?!?
B: It happens. When we went back the next morning, of course, the bag was gone.
Luckily, after applying some significant pressure from the Dean of the school down, the bag was recovered by the University. This, however, led to them turning the monies over to the feds, which meant that the FBI, CIA, and DEA all performed their investigations in an effort to determine the true owners and legality of the money.
The bills were tested for cocaine and came up nearly 100% positive. Fortunately for us, it turned out that nearly every $100 bill in circulation tests positive for cocaine and so, after detailing our business and playing systems to a bunch of “suits,” we eventually received our lunch bag back, dollars and all. So in the end it turned out OK.
By the way, the movie version of the book, “21,” is scheduled for release March 21, 2008, and stars Kevin Spacey in a mish-mash of my character, Kate Bosworth, and Laurence Fishburne. When I was at one of the shoots where I was invited to be an extra (although I’m sure I’ll end up on the editing floor), I spoke with Kevin Spacey about playing my character. He began by apologizing to me and said that I shouldn’t be disappointed with the way my character is portrayed. After all, he said, “We’re not making a documentary here. We’re just trying to film a movie that will sell seats.”
That got me thinking – Maybe FreshAddress should wait until the movie has left the theatres before bringing Columbia Pictures on as a client? I’m not sure I want to drive all of those additional moviegoers to see Kevin Spacey’s role!
A: Amazing stories! Many thanks for taking the time today, Bill, to share your insights.
B: Sure. Thanks for your thoughtful questions and the opportunity to be a part of your blog.