How to choose the right email service provider in 2020

Alan Harris on November 9th 2020

There are a number of solid email service providers to choose from. How do you decide which is the best for your team, user base, and budget? This lesson will give you insight into the vendor landscape and walk through some key considerations when it comes to selecting an email tool.

News about email’s death has been greatly exaggerated. Yes, email is one of the oldest digital marketing channels (the first email blast was in 1978!), but the email service provider (ESP) landscape still has a lot of innovation to offer.

Maybe you’ve pulled together enough user emails for your list that personalizing your messages via Gmail isn’t cutting it anymore. Or, you’ve been in the email-slinging game for a while, and you're ready to upgrade your solution. Either way, congrats on hitting your email milestone; you've come to the right place to understand the next steps you should take.

How email has changed in the last decade

In the last 48 years, email marketing grew from a cheeky stunt in the ’70s to a bona fide fledgling industry in the ’90s to the massive ESP industry we know today. The last 10 years, in particular, have been eventful, and the major trends are important to take into account.

  • Larger vendors have cemented their grip. Overall, the major consolidation moves happened a while ago; now, the big players like Oracle, Salesforce, and Adobe dominate.

  • Email tools offer less specialization in exchange for broader appeal. Email service providers for small businesses, like Campaign Monitor, have added pricing options for larger businesses. At the same time, others that were highly specialized, like SendGrid that was focused on transactional auto-response emails, now have more mainstream features.

  • Up-and-comers shaking up the market. Technology outside of the ESP realm threatens to change how the end consumer interacts with their email. For instance, HEY, a new email provider, is looking to filter out unwanted emails, while Front wants to corner the customer communication market.

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Yes, email is still a big deal

As we mentioned above, there have long been bold predictions that email might die. Five years ago, John Brandon at Inc. predicted by 2020 it would be time to “stick a fork in your email.”

Of course, that hasn’t happened. But email still has a bad reputation as being a spammy, unhelpful marketing channel. While that can be the case in specific circumstances, it’s just not true in the aggregate.

Two shining examples of why email is a viable communication channel include:

  • The rise of Substack, proving that people still read email if it’s valuable and relevant to them. In fact, the Washington Post says that “More than 100,000 people pay to subscribe to writers.” People still read email—and they enjoy it.

  • According to HubSpot, throughout 2019, marketers saw an overall 78% increase in engagement. In general, people find email a helpful and necessary part of their daily routine.

Considerations for choosing an email service provider

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1. Size of contact list

In this lesson, we'll share which ESPs are best suited for various contact list sizes—ranging from smaller ESPs for small and medium-sized businesses (like Mailchimp) to massive enterprise ESPs (like Salesforce). The size of the email contact list usually coincides with the number of features the ESP has. Tools that can handle large lists are usually very sophisticated with complex drip-nurture and trigger-based logic, while smaller tools may focus on user-friendliness.

2. B2B vs. B2C

Besides the size of the contact lists, the other big differentiator is the ESP’s target audience. B2B-focused ESPs tend to center on lead nurturing, while B2C-focused ESPs put an emphasis on events, sales, announcements, and more.

3. Cost and ease of use

Naturally, it's also prudent to look at the cost of the ESP, as well as how much time your team will need to invest in learning all the bells and whistles. As mentioned above, Mailchimp is known for user-friendliness but lacks deep trigger-based logic. Salesforce's Pardot, on the other hand, is much more technically advanced but requires some HTML knowledge to design the emails exactly how you want them.

4. Integration within your tech stack

Look for an ESP that plays nicely with the tools you already use. In particular, pay attention to how well it integrates with your customer relationship management platform (CRM). This is such an important factor that CRMs and ESPs are often blended together into one product, like HubSpot and Braze.

Top email service providers

Twilio SendGrid

Like Segment, SendGrid is a subsidiary of Twilio and is one of the most trusted platforms for transactional email and email marketing.

Two of the biggest benefits of SendGrid are deliverability and scale. Their deliverability features (domain authentication, proactive ISP outreach, etc) help businesses record an open rate improvement of over 6 percentage points. This can also be performed at significant scale. The SendGrid platform sends 70 billion emails every month with 99.999% uptime so you can rest assured your email will reach your recipients.

Top features:

  • Purpose build Mail Transfer Agent that can scale to billions of emails

  • Powerful email marketing automation via SendGrid Automations

  • Artificial intelligence that continually adapts to changing ISP rules

  • Multi-channel messaging (SMS, MMS, WhatsApp, and chat) via the Twilio platform

SendGrid is great for:

  • Developers and marketers

  • Promotional and transactional email

  • High volume senders - reliable email delivery at scale

Braze

Braze (formerly Appboy) first established itself as a mobile-first CRM with powerful text and push-messaging features. With recent enhancements to its email marketing functionality and the addition of a visual journey builder, Braze has become a lifecycle engagement platform with an emphasis on highly personalized, targeted customer messaging across many channels.

Top features:

  • Push and SMS notifications

  • Visual customer journey builder called Braze Canvas

  • Automated multi-channel messaging

  • Strong customer support

Braze is great for:

  • Marketers using push notifications and email

  • Mid-market to enterprise businesses of any industry, but Braze is especially useful for push-centric B2C brands

  • Contact lists of any size

Customer.io

Customer.io is a data-driven marketing platform for newsletter creation, transactional emails, SMS notifications, and customer profile-triggered messaging. Its focus is to provide a flexible and easy-to-implement solution for data-driven startups and SMBs.

Top features:

  • Flexible customer behavioral data mapping

  • Integration with Shopify's open-source Liquid logic

  • Sophisticated activation and retention-oriented email campaigns from real-time triggers on customer behaviors

  • Orients around the user and how they've interacted with sent messages

Customer.io is great for:

  • Marketers looking to implement a seamless plug-and-play tool for customer messaging

  • Ecommerce SMBs and startups

  • Contact lists of any size

Drip

Drip is an email marketing automation platform well suited for B2B marketers. The visual campaign builder offers customizable triggers, actions, and integrations to create automated campaigns based on customer behavior.

Top features:

  • Ease-of-use

  • Workflow builder

  • Can resend emails with a different subject line to users who didn't initially open

  • Integration with Shopify, WooComerce, and Magento for a unified ecommerce experience

Drip is great for:

  • Marketers looking for advanced marketing automation with a lean team

  • SMBs and startups of any industry, but particularly those focused on ecommerce

  • Relatively small contact lists to mid-sized lists

HubSpot

More than just an email service provider, Hubspot is a full-blown CRM that also helps manage social media, lead generation, and content. As the original and self-proclaimed "Inbound Marketing Platform," HubSpot helps marketers both create demand through content and nurture leads through email campaigns. HubSpot is known for being easy to use and navigate and, as such, is appropriate for large and small businesses alike. However, the pricing model is dependent on the total number of contacts in your database, so it becomes cost-prohibitive for very large-scale businesses.

Top features:

  • Many built-in API integrations

  • Visibility across additional touchpoints on social media platforms

  • Lead-generation identification capabilities

  • Integration with inbound marketing and demand-generation processes

HubSpot is great for:

  • Marketers looking for a full suite of marketing automation solutions and tools for inbound marketing

  • B2B and B2C companies of any size, but HubSpot can become cost-prohibitive for large B2C lists

  • Contact lists of more than 25K

Iterable

Iterable is a multi-channel customer engagement and marketing automation platform. It focuses on offering less-technically savvy marketers access to intuitive yet powerful drag-and-drop automation flows, dynamic personalization, and segmentation features that would typically require more in-depth engineering support and resources.

Top features:

  • Ease of use

  • Multivariate testing

  • Omnichannel campaigns

  • Deep personalization capabilities

Iterable is great for:

  • Marketers looking to unlock multi-channel marketing automation with minimal engineering support

  • Mid-sized B2C companies, though B2B companies might find use for Iterable

  • Contact lists of more than 100K

Mailchimp

Mailchimp is a fan favorite for many startups with small marketing teams. Not only is it quick to get up and running, but the templates are intuitive and straightforward to navigate, too. Though it still lacks some features, such as allowing the creation of automated A/B split tests into subject lines, it has recently added new functionality along with its rebrand.

Top features:

  • Quick to set up

  • Easy to use

  • Built-in design templates

  • Doesn't require a developer or designer

Mailchimp is great for:

  • Marketing teams looking to deploy an easy-to-use email marketing tool

  • Small to mid-sized businesses of any industry

  • Contact lists of more than 100+

Marketo

Often thought of as the 10,000-pound gorilla in the email marketing automation space, Marketo became an early market leader for multi-campaign email management. However, more functionality means a higher price tag and sophisticated users to operate it. Marketo is great for mid-market to enterprise-level B2B customers already on the Adobe suite. It might not be appropriate for very small businesses due to the cost or the advanced skill level and training required to operate it. That said, we are a fan—Marketo is what we use here internally at Segment.

Top features:

  • Deep Salesforce integration for advanced lead scoring

  • Easy-to-use user interface and templates

  • High level of functionality and integrations

  • Tried-and-true name brand

  • Ability to manage sensitive lists requiring privacy in the financial or healthcare spaces

Marketo is great for:

  • Marketing teams looking to automate email marketing and integrate with CRMs

  • B2B companies of any size but must be spending at least $3-$5M per year in marketing

  • Contact lists of more than 100K

Salesforce Marketing Cloud

Salesforce Marketing Cloud is a powerful CRM and marketing automation platform with ESP capabilities designed with the enterprise in mind. The ESP portions were created with the acquisitions of ExactTarget (for B2C) and Pardot (for B2B). It’s a big investment that will require some work to get set up, but once Salesforce is up and running to your specifications, it can be very powerful.

Top features:

  • Very comprehensive

  • Automation and routing

  • Great for companies that can deploy developers for deep customization

Salesforce Marketing Cloud is great for:

  • Marketers looking to use one of the most comprehensive email suites available

  • Large B2B and B2C enterprise businesses

  • Large contact lists of more than 100K

A few more to consider

  • SendGrid for communication automation within the ever-expanding Twilio ecosystem

  • User.com for heavy personalization capabilities

  • Oracle Eloqua for integration with dynamic cross-channel campaigns

  • Klaviyo for companies that use point-of-sale data to inform email marketing

Choosing an email service provider

These days, the ESP industry is fairly mature, and, as such, each vendor will cover the basics and has a solid roster of customers that you can learn from. While certain tools are much better suited for certain sized businesses and industries, each tool will be able to accomplish the basics of engaging with your user base at scale in personalized ways. This is especially true if you've set up your analytics with a tool like Segment.

For more information on the email service providers that Segment offers, check out our catalog of integrations here.

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