Economies of Scale and the Cold Call: Take a look at Messagemedia's white paper titled "$20,000 in Orders in Less Than 72 Hours".
messagemedia.com
Highlights:
"An electronic marketing message promoted a necklace at the standard (non-discounted) price of $195."
"From over 55,000 contacted leads, nearly 10,000 recipients (17%) clicked through on the link to visit the promotional web page... Prospects... responded with over $20,000 in orders, all in less than 72 hours."
In other words:
What they are saying, is that they contacted 55,000 people in order to sell 100 necklaces -- that's less than two-tenths of a percent (0.18%).
This is where economies of scale comes in. In order to make money off email marketing, you have to contact a lot of people.
Imagine you are a Mom and Pop shop with a web page on the internet. If you do not have brand name recognition, you'll probably never get 55,000 people to sign up for your opt-in email let alone visit your page. The alternative is UCE. "To spam or not to spam", that is the question. Basically, you are damned if you spam or damned if you don't because of the economy of scale.
This is why a lot of e-businesses will close up shop after Christmas and why many bulk emailers who depend on these kinds of clients will be hurting as well. |
