Electronic Retailers Hurt by Spam Flood

Computerworld - BOSTON -- A New York-based online jewelry retailer blasted an e-mail to customers with the subject line "Hot Summer Styles." Even though the intended recipients had asked to receive mailings from the company, some 300,000 of them never saw it.
The word hot apparently triggered filters that blocked the message from being delivered, said Pinny Gniwisch, a founder of Ice.com. "The filters are not smart," he lamented.
Many electronic retailers at last week's eTail 2003 conference here complained that they're suffering from an antispam backlash even though they said they have opt-in mail policies and don't spam anyone.
Several electronic retailers said that in the past six months, they've found their marketing messages being increasingly blocked or filtered, or simply going unread by customers who are inundated with so much unwanted e-mail that they're starting to tune out even legitimate communications.
"This is the big battleground -- getting your mail through," said Daniel Gudema, e-commerce strategist at ABC Distributing LLC in North Miami. "Maybe e-mail will become obsolete as a marketing tool."
Some retailers claim that they're starting to see the harmful effects in their general ledgers. Online retailer eBags sends out about 8 million electronic messages per month to customers who opt to receive its mailings, according to CEO Jon Nordmark. A year ago, 22% of the recipients made purchases as a direct result of those messages. Now the conversion percentage is 13.2%.
Nordmark said the Greenwood Village, Colo., retailer hit profitability last year and has seen overall revenue grow 90%. But e-mail is no longer the primary growth driver. It now ranks behind affiliate marketing, off-line catalogs and search technology on the priority list, he said.
Mike Frazzini, vice president of technology at eBags, is convinced spam is to blame. He estimated that at least 30% of the company's e-mail is being blocked or filtered, although he acknowledged that it's tough to quantify. He said a company often doesn't know if its mail is being blocked at the server by an Internet service provider or a corporation, or on the client side with filters set up by individual users.
Frazzini said the company is working to make sure its domain isn't turning up on any of the black lists that antispam groups, such as Mail Abuse Prevention System LLC, have established to help companies set up spam filters. He said corporations and Internet service providers sometimes use those lists to set up server-based filters.
Matthew Berk, an analyst at Jupiter Research in New York, advises retailers to outsource