Economics of spam

There was a discussion on Slack about the economics of email. It’s probably not a surprise that I have opinions (Who owns the inbox? Ownership of the Inbox). There was a discussion about this that was useful enough I’d share it.

Participants:

  • Laura: Laura Atkins (me!)
  • Steve: Steve Atkins (other half of WttW)
  • Matt V: Director Privacy @ 250ok

Laura: Direct mail to your home the owner of the channel is paid (in the US, the USPS is the owner of your mailbox). The economics of email are different, even when I’m leasing a mailbox, say from Gmail, that mailbox is owned by Google, not the person using it as a marketing channel. Senders only pay half the transaction costs, receivers pay substantially to handle incoming email.

One of the initial drives for filtering was to stop spammers from costing the receivers so much money. Very early on some ISP users had to pay per email to/from the internet (I think that was compuserv?) so every unsolicited message had to be paid for by the recipient. (There was some pay per email at AOL early on, too, I think).

But ISPs had to increase capacity and make significant investments in hardware to cope with the unsolicited email. Handling spam costs them real money, too. All of this lead to the ISP end of the industry basically saying they’d only accept mail from opt-in senders. “We’re happy to deliver mail that recipients have asked for.”

We have expanded “opt-in” to “wanted” and “relevant” because we can measure those things better than we could previously. But marketers don’t own the email channel. At best they own half of it. Once the message touches the recipient MX, the sender isn’t paying for it. The receiver – the ISP or the end user – is.

Goodmail tried to actually make the senders pay for the channel. And they failed in part because the majority of their customers were spammers and the ISPs decided the amount of money that Goodmail was paying them to accept the mail wasn’t paying for the loss of customers.

Bonded Sender (the product that eventually became Return Path Certified) also tried to flip the economic model. You could get certified and if the mail you were sending was spam, then you would forfeit a bond to the companies you spammed.

Habeas tried a different economic model and that didn’t work, either.

Matt V: especially since spammers tend to steal the delivery resources from people as well, so they have a near zero cost and any purchase/transaction/infection/etc… is upside to the the economics of spam are crazy, and that is a good portion of why it is so problematic.

Laura: You can, of course, pay to get to the inbox. Both Verizon Media and Google will let you buy advertising that looks exactly like email. It’s not email, it’s a display ad, but it looks like email.

Steve: “Because infected windows machines are almost free.” is the counterargument to a lot of “we could reduce spam if…” proposals.

Laura: Intrusiveness is another issue, but in this case I’m actually speaking only and directly about the economics and who owns an email box. There are a lot of different answers, depending on how you measure, but “marketers” is never the right answer.

Matt V: also very few people talk about the inbox without filtering and how unusable it would be… email would die quickly if all the filtering were turned off

Laura: Very few people have an unfiltered email box. Even I don’t, although we have a whole lot less filtering than many places for reasons.

Steve: Yeah. Aggressive spam filters are the only thing keeping email marketing – amongst other things – a viable business.

Laura: But I can’t read mail on my phone in the morning if my laptop has been shut down over night. There’s just too much spam to go through. I’ve got to let the filters built into mail.app do it’s thing and then go through and still manually delete between 20 and 50 messages.

Overall, we’re in a position where even in the face of free webmail providers, someone is paying for the inbox. In no cases are email senders covering the cost of their email to the recipient / recipient ISP. This is fine and good. We’ve all opted in to mail we want and enjoy and like. But it’s disingenuous to pretend that email is a channel like bill boards or television or magazine or even direct mail. The economics are just too different.


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Engagement, Engagement, Engagement

I saw a headline today:
New Research from Return Path Shows Strong Correlation Between Subscriber Engagement and Spam Placement
I have to admit, my first reaction was “Uh, Yeah.” But then I realized that there are some email marketers who do not believe engagement is important for email deliverability. This is exactly the report they need to read. It lays out the factors that ISPs look at to determine if email is wanted by the users. Senders have to deal with vague metrics like opens and clicks, but the ISPs have access to user behavior. ISPs can see if mail is replied to, or forwarded or deleted without reading. They monitor if a user hits “this-is-spam” or moves the message to their junk folder. All of these things are signals about what the users want and don’t want.
Still, there are the folks who will continue to deny engagement is a factor in deliverability. Most of the folks in this group profit based on the number of emails sent. Therefore, any message about decreasing sends hurts their bottom line. These engagement deniers have set out to discredit anyone who suggests that targeting, segmentation or engagement provide for better email delivery and getting emails to the inbox.
There’s another group of deniers who may or may not believe engagement is the key to the inbox, but they don’t care. They have said they will happily suffer with lower inbox delivery if it means they can send more mail. They don’t necessarily want to discredit deliverability, but they really don’t like that deliverability can stop them from sending.
Whether or not you want to believe engagement is a critical factor in reaching your subscribers, it is. Saying it’s not doesn’t change the facts.
There are three things important in deliverability: engagement, engagement, engagement.

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Recipients are the secret to good delivery

Many, many people hire me to educate them on delivery and fix their email problems. This is good, it’s what I do. And I’m quite good at helping clients see where their email program isn’t meeting expectations. I can translate tech speak into marketing. I can explain things in a way that shifts a client’s perception of what the underlying issues are. I can help them find their own way into the inbox.
But…
Most of what I do is simply think about email delivery from the point of view of a recipient and help clients better meet their recipient’s expectations. This works. This works really well. If you send mail that your recipients want your mail gets to the inbox.
Here’s the secret: ISPs and most spam filters have a design goal to deliver mail their users want. They only want to block mail their users don’t want.
Filters are not designed to block wanted mail.
Sure there are complicated situations where senders have gotten behind the 8 ball and need some help cleaning up. There are situations where filters screw up and block mail they shouldn’t (and aren’t quite designed to). Spam filters are complicated bits of code and sometimes they do things unexpectedly. All of these things do happen.
But these situations happen a lot less than most senders think. Most of the time when mail is hitting the bulk folder, or is throttled at the MTA the issue is that recipients don’t care about the mail.
Recipients aren’t engaged with a particular sender or particular brand. So ISPs react accordingly and that mail ends up slowly delivered or bulked. This upsets the senders to no end, but the recipients? The recipients often don’t care that some mail shows up in bulk or arrives Wednesday afternoon instead of Tuesday evening.
When recipients are engaged with a particular sender or brand, though? Delivery is fast and reliable. Mail is rarely delayed or bulked. When recipients want mail, they interact with it. They look in the bulk folder. They miss it when it’s not there. They complain to the ISPs when they don’t get it. The ISPs react accordingly and prioritize or “red carpet” that email.
The secret to really good delivery is to get your recipients to handle your ISP relations for you. Send mail they miss when they don’t get it, and you’ll discover most of your delivery problems go away.
 
 

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Ownership of the inbox

Marketers often treat recipient inboxes with a certain level of ownership. They talk about getting mail to the inbox with the underlying implication that inboxes are for use by marketers and they tend to forget that recipients use email for a lot of things, not just being marketing targets.
This was crystallized for me a few years ago when I was running a conference session. The session had a very diverse group of attendees and as part of the session they broke up into smaller groups to talk about various email related topics. One of the questions was how do people use email. Those groups with more ISP representatives produced a list with dozens of ways people use email. The groups dominated with email marketers, though, came up with a much more limited set of uses, all of them related to marketing or commerce. They didn’t mention mailing lists or one on one discussions or connecting with friends as part of the things people use email for.
Marketers seem to forget that email was not adopted by users so they could be marketed to. In fact, email is primarily used by people to interact with friends, colleagues, allies and family members. Most recipients really don’t really care about marketing in their inbox. They’re much more interested in the mail from mom with pictures of the new puppy. They’re looking for that mail from a friend linking to a silly video. They’re deeply involved in an online discussion with friends or colleagues about anything at all.
This doesn’t mean they don’t want marketing in their inbox. Every subscription is an invitation to visit the recipient’s mailbox. They are inviting a sales person to visit them at home or at work;  spaces where marketers are not traditionally invited.
The problem is that a lot of email marketers do not respect the space they’ve been invited into. They assume, usually incorrectly, they are being given ownership of that space. The marketer sees the inbox as their marketing space, not as space that the recipient feels ownership over.
When someone buys a magazine or watches TV, there are a lot of ads, but that’s OK because they don’t feel any ownership of those spaces. But when they subscribe to something in email, they don’t cede ownership of their inbox to the senders. It is still their inbox and marketers are there only because the recipient invited them. The recipient will kick marketers out if they start writing on the walls or otherwise disrespecting their space.
Many delivery consultants talk about engagement and sending timely, relevant email. All of those are really coded phrases meaning “when you’re invited into somebody’s house don’t scrawl on the walls or poop on the carpets.”

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