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Email Advertising Rates Get Boost From ‘Visible Impressions’

Email Marketing

Email advertising rates may find new life when publishers embrace the concept of visible impressions.

Visible impressions is a new online industry trend that says the value of an ad impression is based on being visible on a Web site without requiring the user to scroll down the page to see it.

In other words, the ad appears somewhere at the top of the page.

The concept supports the branding part of online advertising. If the site visitor can see the ad, he or she may register the brand for future consumption. The visitor doesn’t have to click on the ad for it to have credible and measurable value.

But the concept faces a unique challenge in the email marketing environment because of low open rates and images that are blocked by email readers.

The Fall and Rise of Email Advertising

Email advertising revenue has declined to the point where the Internet Advertising Bureau no longer tracks how much is spent in the category.

Search, mobile, social media, banner advertising and other categories consume the vast majority of online ad spending.

Several factors brought down the email advertising category. One of the biggest factors was cost.

It is not an exaggeration to say that some vendors were charging as much as $100 or even $200 per thousand emails about 10 years ago.

The quality of many email lists was dubious. Open rates struggled to stay above 20 percent of the total subscribers. That means at least 80 percent of the ad impressions were not visible to those subscribers.

Even worse, many email viewers automatically block images unless the user approves seeing them. These limits hurt the advertising effectiveness and return on investment for the advertiser.

email marketing metricsAcquiring and retaining subscribers was challenging, in part because people would change email addresses. It became easier to acquire 10,000 Facebook likes than 10,000 email subscribers.

Search engines and social media companies became effective with targeting their massive audiences based on geography down to the zip code level, age factors, income factors and even delivering ads based on time of day or day of week.

They also were quite a bit cheaper.

But email marketing has survived the competition — smaller and battered but not done. Companies are still selling ads on emails, especially ones with a local or topical focus. Emails with a local focus have built-in geographic targeting. Emails with a topical focus have built-in demographic targeting.

Given that email marketing is still widely used, the biggest challenge for advertising is how to price those emails.

Rates As Impression CPMs

Email advertising rates are now measurable as impression CPMs, visible impression CPMs and cost per click.

A simple $10 cost per thousand rate for a newsletter with 10,000 subscribers will cost an advertiser $100.

If that newsletter has a 25 percent open rate, and the ad appears at the top of the email, the visible impression CPM is $40.

A related Web site has the same ad at the top of every page. If the CPM is $10, the visible CPM is $10 as well.

If the ad appears at the bottom of the page, the visible CPM shoots up depending on the percent of people who scroll down the page.

Clearly, a $10 CPM in an email newsletter is much more expensive than the same ad on the Web site. With a 25 percent open rate, the fair and comparable rate is actually $2.50.

Publishers and sales managers may choke over such a low number. But all is not lost.

An email has a much more confined space that makes an ad more prominent and may increase the odds of a higher click rate. If the click rate of email ads is higher than site ads, it pushes the CPM value back up again.

If email ads have a click rate twice as high as site ads, the CPM could arguably go back up to $5. Tracking the click rates becomes essential for fair and value-based pricing.

Either way, email advertising rates with a lower CPM is still a viable sales option. Compensate for the lower CPMs by selling longer-term contracts. Focus on total gross revenue rather than being discouraged by lower CPMs.

One final tip: Be sure to place an alt tag on the image that entices people to click even when they block images. They may not see the image, but they should see the alt tag as a clickable link. A creative alt tag is better than a boring tag or no tag at all.

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