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E-mail Message Volume
in the U.S., 1999-2003

In Billions
Source: eMarketer, 2000


Trends In Internet-Based Marketing
Researched and written by Ray Wyman, Jr.

This business report was compiled December 2000 for an Internet marketing company.

The Internet provides advertisers with a unique ability to target specific groups, receive direct feedback, and mine valuable consumer data for future campaigns. It is no surprise, then, that Internet marketing expenditures are projected to rise from $603 million in 1998 to $5.3 billion by 2003. EZCoupons, developed by CCI, is a low-cost way for your business to expand into Internet-based 'direct-to-consumer' marketing in three ways: Coupons, E-mail marketing, and Opt-in marketing.

Coupons have long been a way that brick and mortar retailers have promoted products and services. They have now migrated to the Internet. Distribution of total coupons, both offline and online, in 1999 was $263 billion, up 1.2% from 1998. According to a May 2000 survey by The NPD Group, Inc. the number of online coupon users grew from 23% of all Internet users to 27% in one year. Electronic coupons are also growing in importance among all coupon users. Online coupon usage accounted for 10% of total coupon use in March 2000, double the figure of six months earlier.

E-mail is the dominant Internet vehicle for communication. The advantages of using e-mail are enormous; it has very low cost, global reach, ease of use and is immediate. People are spending more time using e-mail as their communication tool of choice, both at work and at home. In the U.S., there are 97 million active e-mail users, defined as those aged 14+ who send or receive five or more e-mail messages a week. This group represents 44% of the total population over the age of 14 and is expected to grow to 140 million by 2003. The primary reason web users give for going online is e-mail: so say 92% of respondents according to Jupiter Research and 89% according to Forrester Research.

Not since the development of television has a single medium revolutionized the opportunities for marketing. According to various reporting sources, U.S. e-mail marketing expenditures in 2000 surpassed the $1 billion mark predicted in eMarketer's 2000's "e-mail Marketing Report". The report also states that overall U.S. e-mail marketing expenditures are expected to increase over 400% to $4.5 billion by 2003. Spending on e-mail advertising, which accounts for approximately 46% of total spending on e-mail marketing, will increase over the same period from $496 million to over $2 billion. Furthermore, Jupiter Communications predicts that 'direct-to-consumer' e-mail sales will reach $7.3 billion in 2005 - their estimate assumes a direct mail industry that is generating as much as $56 billion in the same year.

Opt-in E-mail Marketing is a technique that uses "permission marketing" as a means for generating highly qualified audiences. Most commercial e-mail is unsolicited and is not targeted to the recipient's needs or interests. Known as 'spam', the electronic equivalent of junk mail, this method has grown increasingly ineffective due to growing resentment towards unsolicited messages. Public outcry in the U.S. will likely result in tightened privacy laws, such as what has already transpired in Europe. Nevertheless, spam is already doomed, as returns have become increasingly poor, primarily because the offerings are often not relevant. Of course, not all e-mail is commercial e-mail. As noted above, personal communications will continue to outpace business e-mailings. However, permission e-mail is on the upswing and will grow much faster than regular e-mail.

Option In e-mail, or "Opt-in", has emerged as an attractive alternative to sending unsolicited e-mail and is the marketing tool of choice for merchants, manufacturers, distributors, and retailers. Consumers give companies permission to send them e-mail messages in return for something ? for example, a coupon, valuable information, a free product or service, or a chance to win a prize. The more communication there is the more understanding there can be between customers and companies. For companies, permission marketing is the key that turns strangers into friends and friends into loyal customers.

Opt-in e-mail is targeted, effective, relatively low in cost, and able to reach a growing market of e-mail users. The volume of e-mail is projected to triple from 61 billion messages in 2000 to 240 billion in 2003 and, according to eMarketer, opt-in e-mail will grow far faster than total e-mail.. -HP

E-mail Marketing

(in Millions)

1999 2000 2001 2002 2003
E-mail Marketing
$422 $1,084 $2,074 $3,265 $4,558
E-mail Advertising $179 $496 $927 $1,158 $2,199
E-mail Marketing
$242 $589 $1,148 $1,707 $2,359

Growth Rate of
Opt-In E-mail

vs. Total e-mail
(in Percentages)
Source: "ePostman Rings Twice
(At Least)" eMarketer.com, October, 2000



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