To accomplish that goal, the e-marketing group brought in e-mail analysis, segmentation and personalization tools from San Mateo, Calif.-based Digital Impact. By analyzing its e-mail databases, HP found that its business customers fell into two groups?IT managers and end users. So instead of immediately churning out more e-mail campaigns, HP set out to learn what these groups wanted through small pilot tests. The company found that IT managers were willing to tell HP exactly what kinds of general product and support alerts and newsletters they’d like to receive (such as laptop support newsletters and discussion forums, print driver updates, and new product introductions) while end users wanted much more specific information about the exact product (network server, PC or printer model number) they’d purchased and how to use it.

Horstmeier and his group decided to provide exactly what these two groups asked for, but they wanted to find out which type of marketing campaign best suited each customer’s individual preferences. So HP embarked on a carefully controlled project comparing an e-mail campaign with a direct-mail offer. He says his team looked at both cost savings and revenues generated from both campaigns, and studied the e-mail marketing’s effect on the customer experience. The results showed that more of their customers responded to the low-cost e-mail offer, making it over 20 times more cost-effective. (It costs $1 per direct mailing per customer but only between 10 and 15 cents per customer to create and send monthly e-mail, for more than 1 million customers per month.) Customers also said they loved getting the e-mail alerts and updates with more than 85 percent saying they were quite satisfied with the content they received. And the e-mail campaigns generated an estimated $15 million in new sales revenues per month, Horstmeier says.

As for cost savings, the e-marketing division estimates they save a half million dollars per month by combining and reducing the multiple e-mail campaigns. By sending out product support alerts and e-mails, the resulting reduction in calls made to support lines alone saves close to $150,000 a month, Horstmeier says.

"We found that we can deal with IT managers with a one-to-many campaign where they all get some of the same e-mails. It’s high volume and quick," Horstmeier says. But the company’s customers "require more tailored campaigns that fit their specific situations?these require a deeper level of personalization and detail, which bring us a greater level of detail in return."