New Fees Expected for Online Marketing

Portals and Internet service providers (ISPs) are going to start charging online marketers for the massive volume of e-mail being sent across the Web, according to a report released Wednesday by Jupiter Research.

In 2005, advertisers are expected to send some 268 billion e-mail messages -- 22 times the number of e-mails sent last year, and more than 5,600 for each e-mail subscriber, the research firm said.

"Internet e-mail service providers control a crucial chokepoint between marketers and the millions of consumers they want to reach," said Jupiter analyst Christopher Todd. "As they restrict access to a user's primary inbox and monetize the delivery of promotional e-mail, advertisers looking to reach consumers online must prepare to pay a premium."

Todd said that savvy marketers will recognize that the new controls to be asserted by ISPs is "an opportunity to distance their messages from existing inbox clutter," while the portals and ISPs will see it as "a significant opportunity to generate additional revenue" from their sizable e-mail subscriber base.

Tiers of Service

As e-mail marketing increases, the business of sending e-mails will likely evolve into a "tier-based" system, with senders paying more for premium services, Jupiter said.

First tier e-mail, for example, would be sent to a targeted user's primary inbox at the time of day that person was most likely to be online.

Second tier messages would likely be delivered into the primary inbox with enhanced fonts and icons to make it stand out. Third tier e-mails would provide standard delivery direct to the primary inbox.

The bottom tier would be reserved for free, bulk e-mail messages that would go into a separate "junk" inbox.

End to Spam?

If Jupiter's predictions are correct, it would be welcome news for Web users who are sick of receiving unsolicited commercial e-mail, or spam.

"On the consumer side, this may be end of spam as we know it," said Todd.

At the same time, he said, marketers will still be able to reach users.

"Consumer e-mail users will adopt and accept new delivery tiers as they realize increased efficacy within their primary inbox," Todd said.

Budget for Expansion

Marketers, advised Jupiter, should begin factoring the costs of promotional e-mail delivery into their budget planning. They would also do well to establish strategic partnerships with major Internet e-mail providers in order to position themselves correctly when the e-mail tiers emerge.

One way for marketers to get ahead of the curve, the report said, would be to include e-mail delivery as a primary component of anchor tenancy or exclusivity agreements with major portals and ISPs.