Ever since e-commerce executives had their allowances yanked by the capital markets and venture capitalists, e-mail marketing has been hailed as a savior of sorts -- a low-cost way to reach consumers and bring them back for more.
The only problem, of course, is that the more time people spend on the Web, the wearier they grow of e-mail marketing. According to a March report from Forrester Research, about 40 percent of people with at least four years of Internet surfing experience generally ignore e-mail marketing. For those with a year or less of online experience, the tune-out number is about 20 percent.
So even as the field of dotcom survivors narrows, it is not necessarily a safe bet that e-mail promotions will get the same notice from consumers as when there were hundreds of e-tailers fighting for attention.
As a result, a growing number of e-commerce companies are hedging their bets with the terrestrial equivalent of spam: paper junk mail. Internet executives and analysts say that direct-mail campaigns are gaining popularity among online companies, despite the fact that physical mailings cost far more than e-mail.
"With the growth of the Internet, you'd guess that people are moving away from paper communications and more toward electronic interactions," said Tom Shimko, a partner with Peppers & Rogers Group, a consulting firm. "But that's not necessarily the case."
Certainly consumers still have an affinity for paper advertisements. According to a recent study conducted by Shimko's firm and sponsored by Pitney Bowes, a marketer of mailing systems, 34 percent of respondents said direct mail was most effective in establishing a relationship with them, compared with print ads (30 percent), television (25 percent), radio (5 percent) and e-mail (4 percent). It might have been more surprising, of course, if a survey sponsored by Pitney Bowes had not found that paper mailings were highly effective.
"A lot of this is about control," Shimko said. Direct mail is "certainly less intrusive than e-mail," he said, "and there's no great way to store or retrieve e-mail, so it's not easy to take it with you on a plane or a train and look at it when you want to."
Peapod.com, the Internet grocer, puts much more emphasis on direct-mail marketing than on e-mail, said Michael Brennan, Peapod's senior vice president for marketing. "People just can't get to their e-mails now, it seems, so breaking through that clutter is becoming a greater challenge," he said. "With direct mail, you have maybe a couple more seconds to get someone's attention."
Shimko would not disclose the amount his company spent on direct-mail advertisements, but he said such efforts were a core component of Peapod's marketing.
"We're a little different from other Internet companies, in that we have to build sales in a local market," he said. "And direct mail helps us target certain ZIP codes so we can fill a truckful of orders."
In the movement toward direct-mail marketing, some pessimists remain. Joseph Kennedy, president of E-Loan, the online lender, said, "E-mail enables us to be relevant in ways direct mail never could."
Kennedy said he had recently conducted a co-marketing campaign with Charles Schwab, the financial-services firm, mailing "hundreds of thousands" of e-mail messages and direct-mail pieces to prospects in the US. Without being specific, he said the e-mail response was superior, in part because the message within the physical mailing "had to be more generic."
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