Why renting third-party lists is among the worst tactics

Brought to you by Marketing Sherpa Blog Writer: Adam T. Sutton  

June 17th, 2011 

I heard an offhand comment the other day from an agency marketer who said most of her B2B clients focused their email marketing on rented third-party lists (despite her advice). I thought to myself, “Really? That can’t be very effective.” I looked at some data and found I was right.
Although 46 percent of B2B email marketers use third-party lists:

• Only 11 percent score the tactic at “four” or “five” on a five-point scale of effectiveness, with “five” being the most effective, according to the MarketingSherpa 2011 B2B Marketing Benchmark Report.
• 57 percent score the tactic at “one” or “two”

These numbers almost completely reverse when we look at B2B marketers emailing to a house list. About 95 percent of B2B email marketers send to their own lists.

• 67 percent consider the tactic a “four” or “five” in terms of effectiveness on a five-point scale, with “five” being the most effective.
• 5 percent consider it a “one” or “two”

For me, these stats help underline the point that high-quality email databases are workhorses in marketing departments, and that marketers need to steer away from thinking about email marketing as advertising.
Love and Respect Your Audience
To elaborate on a point that Brad Bortone made in yesterday’s post, I would like to emphasize that effective email marketing is based on relationships. These relationships hinge on expectations, promises, and trust.
This might sound like fluffy marketing-speak, but bear with me. Specifics are coming.
First, people have expectations when they opt into your email program. You need to clearly set these expectations during the opt-in process by describing:

• The content they’ll receive in your program
• How often they’ll receive emails

Once they opt-in, you’ve officially promised to meet these expectations. If you fulfill your promise and only send what they’ve agreed to, that will build trust. Subscribers will trust your emails will have something they want. That trust translates into higher open and clickthrough rates and helps build an effective program.
If you move outside of the expectations, you are assuming subscribers want something else. You’re breaking your promise, harming your relationship, and undermining trust. You’re encouraging them to click “spam,” ignore your emails, or (at best) opt-out — none of which are good.
So you cannot assume people want your emails. You have to clearly set expectations, keep your promise, build trust and establish good relationships to get good results.

Email Marketing is Not Advertising
Strong email relationships can only come from your house list. On a third-party list, their expectation is to not hear from you. They never opted-in. You’re assuming they want something they’ve never asked for, and you’re encouraging them to click “spam.”
Sure, sending to third-party lists can work. But look at the data above. You’re likely better off investing in your database, segmentation, and relevance.
The mindset that “we’re just going to reach people, even if they’d rather be doing something else,” is an advertising mindset. That’s what marketers do on television. I’d rather be watching Pawn Stars, but instead I’m stuck watching ads.
Advertising is great, but it’s not good email marketing. Good emails are anticipated by subscribers and are relevant to their needs. This is why a good house list is so valuable. Bad emails arrive out of nowhere and interrupt people when they’re doing something else. This is why emailing third-party lists is among the least-effective B2B email marketing tactic today.