Quick industry background: rocket-like growth 2001-2005
January 21, 2007
It’s pretty darn easy to set up shop as an email service provider. Get a mail server, license some software, whip up a Web site, and you’re in business. (Of course that doesn’t mean you’re any good at it.)
During 2001, that’s exactly what plenty of people did because, aside from search marketing, email was one of the few online businesses that was booming. Loads of eager clients hoped to save money by replacing postal mail with email, and very few knew exactly which penetrating questions to ask a would-be vendor.
Then from 2002-2004, a merger and acquisition frenzy took place. Big fish ate small fish; small fish got venture funding for roll-up strategies; and faced with unexpected competition, some vendors disappeared completely.
In 2005, the remaining estimated 65 firms worked frantically to:
- stabilize, hire and train their staff;
- handle an explosion of incoming clients (some gained hundreds of client accounts in 2005 alone);
- develop specialized services to compete in particular niches;
- add on extra bells and whistles ranging from strategic consulting to high-end dynamic content to lift their prices out of commodityland;
- educate clients to avoid all-too-common newbie mistakes;
- and, ensure deliverability in an increasingly difficult ISP landscape.
Yes, you could call it a high-stress industry. And we’ve heard from many ESP leaders that they expect another round of M&A and marketing wars to occur in 2006 until the industry is boiled down to a few main leaders. The word for 2006 is “consolidation.”
Excerpt from Marketing Sherpa
http://www.marketingsherpa.com/sample.cfm?contentID=3132
Posted by copiasolaris under ESP History |