Is the new Gmail killing email marketing

Google have been busy closing off potential ‘leakage’ of their revenue streams. This year saw the launch of their redesigned  Gmail service which hides promotional e-mails and social network updates behind tabs. It seems Google wants to please its customers, to make happy Gmailers even happier, although I suspect the only real motivation is the bottom line, commercial success. As an avid Gmail user, I love the new functionality but as a marketer and believer in email marketing, it may be the devil in disguise.

According to a report carried on Bloomberg, companies such as Groupon which have become so alarmed at the impact the new email features are having on their business models, they have been encouraging e-mail contacts to route their messages back into their personal inbox—an easy step accomplished by simply dragging an e-mail from the “promotions” tab and dropping it in the “primary” tab.

Early signs appear to suggest that the change may not be as bad as some fear. Yesmail, a marketing company that delivers about 40 billion e-mails a year for companies such as EBay says the share of marketing e-mails that were opened—a metric that traditionally ranges from 0 to about 25 percent—has dropped by less than 1 percent.

But I suspect that Yesmail optimism may be premature. Google have clearly launched a shot across the bows of email marketers. Simply restricting visibility of email ads reduces the likelihood they will be opened. Personally, I don’t visit the other tabs since the new service was opened ad I am happy to let ads sit, occasionally perusing to see what ad styles and formats marketers are using to attract attention and boost open rates.

For Google, lower open rates among Gmail users should, in theory at least lead to increased purchase of adjacent ads. Even at a fractional conversion from email to space ads, it’s a win for Google.

But according to Bloomberg, the Gmail redesign may not even be the worst thing to happen to e-mail marketers this year. There’s a more troubling trend: Almost half of all e-mail is now opened on a smartphone, according to Yesmail. But when marketing messages are opened on a mobile phone, the reader takes action—buys something, clicks through, whatever—about half as often as when the message is opened on a desktop. With the battle for online attention heating up, it may be time to revisit the traditional marketing models of direct mail and direct marketing.


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