Costs for direct email marketing can vary greatly depending on services you need and how you send emails. The most common type of direct email marketing is the ASP solution. Most ASPs require a monthly subscription — but no annual contract — and include database management, list segmentation, list hygiene, and other basic services. Many will let you try out their services free for one month so you can test their functionality. Read multiple real world prices that BuyerZone users paid for their email marketing solution.

There are three main pricing models for a direct email marketing ASP solution.

The first is on a per subscriber basis. This allows you to send an unlimited number of emails to your subscribers. The costs range from as little as $10 per month for a list of 100 names to $600 or more for lists of 100,000 email addresses. You receive volume discounts for the largest lists.

Next, is a rate based on total emails sent. For a fixed monthly cost of $20 to $450, you can send 1,000 to 100,000 emails limited to 20 kilobytes (kb) to 30kb each. You can also send additional emails above 100,000 for $5 to $30 CPM (cost per thousand).

If you maintain a very large list and need to send more than 100,000 emails each month, you can get volume discounts. Pricing for larger lists range from $400 to $8,000 per month and can accommodate tens of millions of emails per month. Pricing for additional emails for the largest lists costs $0.50 to $5 CPM.

If you're not ready to commit to sending a certain number of emails per month, some ASP vendors offer a pay as you go option. This lets you conduct a one-time email campaign and pay for each email sent — about $0.02 to $0.15 per email. If you send more than 100,000 emails, you may pay less than one penny per message. In the long run, you'll save money with a larger volume plan.

Most ASP vendors don't charge set-up fees, but a few direct email marketing vendors require a one-time charge of $100 to $500 to get you started.

ASPs can provide copywriting and design for your direct email marketing campaign for an additional $75 to $150 per hour. Optional appending services may cost a few hundred dollars up front plus a per name charge if successfully matched.

To purchase in-house email software, prepare to pay at least $700 for the actual software, plus several hundred to several thousand dollars more for setup, licensing, product updates, and customer service. You may also need new servers or a faster Internet connection if you plan to send a high volume of email.

Full-service direct email marketing firms handle every aspect of your email campaign and charge fees that start at $2,500 per month. This amount can go significantly higher based on the volume and complexity of your mailings and the level of service that you require. They may also require initial startup fees that vary based on the level of setup and integration work required.

This high-end service is best for businesses who mail at least four times per month to 100,000 names or more. Working with full-service firms is also beneficial if you want increased personalization or expert advice for email strategies, creative development, and campaign analysis.

Postage for email?
Businesses that turn to direct email marketing to avoid paying postage could soon face a new challenge. In early 2006, AOL and Yahoo announced plans to charge an optional online postage fee of $0.0025 to $0.01 per message to guarantee delivery into their subscribers' main inboxes. These companies hope that the fees will deter spammers from sending junk mail.

While both companies will continue to accept messages without requiring this fee, those that pay it can bypass spam filters and have emails sent directly to recipients' inboxes. However, this is not a movement to circumvent the CAN-SPAM Act. Even if you pay this fee, you still must agree to only send messages to customers who opt-in.

Although in its infancy, email postage could become a concern later on and impact your direct email marketing budget.