Dear (insert company name), personalized emails don't impress customers

Jun 12, 2012

Personalized email advertisements are far more likely to repel customers than to endear them, according to a study led by a Temple University Fox School of Business professor. But the research – which drew from 10 million marketing emails sent to 600,000 customers – also shows there is a way companies can use personal information without driving customers away: send them deals on products they want.

Using data from a firm's real-world transactions, Assistant Professor of Management Information Systems (MIS) Sunil Wattal found that consumers' responses to personalized greetings ranged from very negative to, at best, neutral. Overall, 95 percent of customers responded negatively when an email ad greeted them by name.

Customers who were unfamiliar with the firm were very likely to click off or unsubscribe from emails with personalized greetings. Customers who were more familiar with the firm were less likely to do so, but still responded more negatively than to emails without greetings. Customers who had made past purchases were unaffected.

Research into sales strategies suggests consumers generally react positively to being recognized by name. But Wattal suggests the variable introduced to online environments – fears of privacy invasion – heavily outweighs the intended personal touch.

"Given the high level of cyber security concerns about phishing, identity theft, and credit card fraud, many consumers would be wary of e-mails, particularly those with personal greetings," Wattal and his co-authors wrote in the study.

Wattal also found that product personalization, in which customers are directed to products that their past purchasing patterns suggest they will like, triggered positive responses in 98 percent of customers, with the positive effect being most pronounced among customers unfamiliar with the firm.

Since consumers may not have known these product-personalization emails used their personal information, researchers suggest that no red flags about privacy were raised, and thus consumers only experienced the positive aspect of these email advertisements: exposure to desirable products.

The study, co-authored by Wattal and Carnegie Mellon professors Rahul Telang, Tridas Mukhopadhyay and Peter Boatwright, is titled "What's in a "Name"? Impact of Use of Customer Information in E-mail Advertisements" and appears online in the journal Information Systems Research.

The researchers used their findings to craft four key strategies for improving marketing effectiveness:

1. Don't assume that a customer's acceptance of the terms and conditions of a privacy policy is a license to openly use their for marketing purposes.

2. Do not send personalized greetings to new customers. If greeting past purchasers personally, don't expect improved results.

3. Send emails to established customers more frequently than to new ones. A large number of emails may drive a new customer away but may prompt an established customer to purchase.

4. Build a relationship with new customers by only emailing them ads for products they are predicted to like. But expand your relationship with existing customers by occasionally exposing them to products they've never bought before.

Explore further: Study looks at stock market performance of polarizing brands

add to favorites email to friend print save as pdf

Related Stories

US banks, companies issue warning after email hack

Apr 04, 2011

Computer hackers gained access to the email addresses of customers of several large US banks and other companies in a potentially huge data breach at US online marketing firm Epsilon. ...

Too much customer contact can hurt business

Jul 15, 2011

Research conducted by an SMU marketing professor and two associates reveals that businesses can go too far when trying to keep in touch with customers, who are easily driven away by too many emails, phone calls and mailers.

Consumers urged to be vigilant in wake of Zappos cyberattack

Jan 18, 2012

(PhysOrg.com) -- As an estimated 24 million Zappos.com customers begin receiving notifications that some of their personal data have been compromised in a massive cyberattack, an Indiana University cybersecurity expert is warning t ...

Recommended for you

Which foods may cost you more due to Calif. drought

12 hours ago

With California experiencing one of its worst droughts on record, grocery shoppers across the country can expect to see a short supply of certain fruits and vegetables in stores, and to pay higher prices ...

Performance measures for CEOs vary greatly, study finds

Apr 16, 2014

As companies file their annual proxy statements with the U.S. Securities and Exchange Commission (SEC) this spring, a new study by Rice University and Cornell University shows just how S&P 500 companies have ...

Investment helps keep transport up to speed

Apr 16, 2014

Greater investment in education and training for employees will be required to meet the future needs of the transport and logistics industry, according to recent reports by Monash University researchers.

User comments : 1

Adjust slider to filter visible comments by rank

Display comments: newest first

Lex Talonis
1 / 5 (1) Jun 12, 2012
1. Don't assume that a customer's acceptance of the terms and conditions of a privacy policy is a license to openly use their personal information for marketing purposes.

LOL

"Oh sign up to a site just to contact them etc.. and the fucking arseholes that run that company then regard this as an opportunity to install TRACKING COOKIES on your system, and to TRACK YOUR MOVEMENTS, and to start sending you daily EMAILS.....

"What part of Fuck Off, don't you cunts get?"

The worst companies are the ones that have the unsubscribe links that don't.

More news stories

Newlyweds, be careful what you wish for

A statistical analysis of the gift "fulfillments" at several hundred online wedding gift registries suggests that wedding guests are caught between a rock and a hard place when it comes to buying an appropriate gift for the ...

Can new understanding avert tragedy?

As a boy growing up in Syracuse, NY, Sol Hsiang ran an experiment for a school project testing whether plants grow better sprinkled with water vs orange juice. Today, 20 years later, he applies complex statistical ...

Roman dig 'transforms understanding' of ancient port

(Phys.org) —Researchers from the universities of Cambridge and Southampton have discovered a new section of the boundary wall of the ancient Roman port of Ostia, proving the city was much larger than previously ...

Crowd-sourcing Britain's Bronze Age

A new joint project by the British Museum and the UCL Institute of Archaeology is seeking online contributions from members of the public to enhance a major British Bronze Age archive and artefact collection.

Hackathon team's GoogolPlex gives Siri extra powers

(Phys.org) —Four freshmen at the University of Pennsylvania have taken Apple's personal assistant Siri to behave as a graduate-level executive assistant which, when asked, is capable of adjusting the temperature ...

Better thermal-imaging lens from waste sulfur

Sulfur left over from refining fossil fuels can be transformed into cheap, lightweight, plastic lenses for infrared devices, including night-vision goggles, a University of Arizona-led international team ...