Online marketing goes far beyond online advertising or banner ads. In the past week, I had the opportunity to talk with several marketing executives in the online marketing industry. These people are responsible not only for spending their clients' money wisely, but also for making decisions about how to market their own companies when the media has been reporting that online marketing is dead. You can read all the results in the 3rd quarter Online Marketing Report, which was produced as a result of these interviews.

Is the Banner Dead?
The message of these executives on the front-line of online marketing was that online marketing works as one part of a marketing strategy. Ron Kovas, president of i-traffic, explained, "There is no single right solution. Each online marketing channel can contribute as part of a larger strategy. You can't talk about the channels in a vacuum."

Is the banner dead? "No," says Al DiGuido, president of BigfootInteractive. "These are all delivery mechanisms — channels. The question is how you use each channel and the combination of media-delivery channels to craft your message. [The banner] is just a medium. Untargeted delivery is dead for every channel."

Where to Put the Money?
Talk about multiple channels is all well and good, but where can marketers put their money today to see results? "You have a skeptical economy, then world tragedy with a complete stop in advertising across all media, now there is a lot of uncertainty. In the fourth quarter, people are only investing in what they know works — things that they've tested," reports Allie Shaw, vice president of Global Marketing for Unicast.

"We've been experimenting with e-mail. You run into the privacy issue. Not everyone we send has specifically asked for it," explains Chris Borghi, director of marketing for Boostworks, the only marketing executive I interviewed who is not with a marketing firm.

What About Lists for E-mail?
With only one exception, marketers said they avoided using purchased or leased lists. One executive said that he was (exactly) once happy with a very targeted list of subscribers he purchased from a reputable publication. He also told me that he'd been burned before by purchasing lists that were inflated with bad addresses and the addresses of unqualified readers. I didn't ask about purchasing software to harvest lists off the Web because I didn't want to insult anyone. However, since I hear from readers from time to time asking whether this is worth it, I'll spell it out. It's not.

The consensus was that e-mail should be sent either to a company's own list or as part of sponsorship of an existing publication. Would I do better to try to reach the target audience for my hypothetical candle business by leasing Martha Stewart's list or by sponsoring her (again, hypothetical) newsletter? "With the newsletter, you're getting her implicit endorsement. You capitalize on her credibility with the readers," opines Mr. Kovas of i-traffic.

Transactional E-mail
Transactional e-mail is one-on-one e-mail that's usually generated as a result of action taken by the customer. For example, when you make a purchase, the merchant sends you an order confirmation, or your online broker might send you your statement online.

"There was a big bank that we worked with — they saw e-mail as a cost center. What e-mail allows you to do is to increase revenues as well. E-mail is used not just for marketing, but for shipping confirmation or for a statement. It's cheaper, too. One client was spending $20 per year per customer to send mailings on paper." Court Cunningham is the vice president and general manager for DARTmail Technology Solutions, DoubleClick.

Joe Merces, vice president of product management with Xpedite, echoed Mr. Cunningham's comments on transactional e-mail. "You can see who is opening and who has clicked through. With e-mail have better measuring potential."

Measurement is Key to Proving ROI
"Fundamentally, customers can measure [e-mail] and see the direct impact. [A large office supply company we worked with] could watch the e-commerce orders come in within hours. The entire ROI (return on investment) for the year was paid for in the first campaign," Christopher Escher, vice president of marketing for Responsys.

"Marketers are moving from unaccountable to accountable. It's not so much the death of print and broadcast as the death of one message fits all — broadbased marketing," Rich Clayton, vice president of product marketing & business development for Responsys.

48 Hours
Just about every person I interviewed mentioned in some way that e-mail delivers results within 48 hours, which is validated by my own experience and that of a reader, Bryan Tartus, CEO of FloralPlanet, who wrote, "My e-mail campaign was a great success. We had more next-day traffic than since we launched the site in November of 2000."

Better, Stronger, Faster
As with the Six Million Dollar Man, online marketing is in need of being rebuilt. The overwhelming consensus of those I interviewed is that e-mail is the cornerstone of successful online marketing. Site sponsorship also plays a role in developing a relationship with the customer, but e-mail tightens the knot.

In addition to being faster, e-mail is also cheaper by a long shot. "Direct mail is $400-500 per thousand messages. E-mail is $4-5 per thousand. You get the same response rate: 1-2 percent. With direct mail all you know is what was purchased. With e-mail you know who opened but didn't buy, and what they clicked on," explained Mr. Cunningham of DoubleClick.

Banners: Not Yet Poised for a Comeback
What about banners? Banners aren't dead, but they aren't the stuff on which a major marketing firm is betting the farm, either. Most executives I interviewed have been around long enough to know better than to declare any channel dead. However, they uniformly believed that the success of the banner will be due to the creativity of the content, rather than the ability to target the content or the size or intrusiveness of the banner.

Alexis D. Gutzman is an author, speaker, and consultant on e-business and e-commerce topics. She's the producer of The Online Marketing Report. Her most recent book, The E-commerce Arsenal: 12 Technologies You Need to Prevail in the Digital Arena, was named one of the 30 best business books of this year. For up-to-date information about her research and speaking engagements, visit The Alexis Gutzman Group's Web site.