The Real Costs of Switching Email Service Providers

Concept of costs calculation, Calculator. Three-dimensional image.

If you’re considering an ESP switch, one of the questions that’s likely top of mind is for you and your management is, what will it cost to move from one email service provider to another?

Based on anecdotal evidence from watching—and helping—clients switch ESPs, both before and during their engagements with ClickMail, in addition to witnessing a recent dialog between industry experts at on the costs of switching ESPs, I’ve pulled together what you might call “some things to consider” to help you understand the real costs associated with switching. Please note: This is not a breakdown of the costs of switching email service providers, nor a guide to figuring out if the cost is worth it. It is, however, a compilation of some observations that I hope you will benefit from as you start number crunching.

Knowing how to justify the costs
Deciding you need to be using a different ESP is not a decision that is made lightly! Switching email service providers is not like choosing a different brand of milk while at the grocery store. There is a cost involved with switching that is significant, plus the whole undertaking is time-consuming—and time is money. Will the cost of switching be worth it when all is said and done?

If the switch means a better infrastructure, that you can scale as needed, that you’re gaining much-needed functionality, or you’re gaining something else that will increase your revenue, then the costs of switching are in a way simply spending money to make money. However, if you’re finding that the C-suite doesn’t believe the cost to be justified by the potential gains, then you might have chosen the wrong ESP or you might need to revisit your justifications for switching—or redo your math.

The cost (and time) of training
Training is one of the costs often overlooked when projecting out. The more people you need trained on the new platform, the longer that will take, and time is money, as I said above. Some degree of training is probably included in your initial costs with a new ESP, and if that’s all you need because you have few users and simple needs, then your costs will be proportionately low. Add users and complexity, however, and training costs and time can go up.

Time and revenue lost while switching
Then there’s the cost of time lost during the switch. You probably won’t be able keep your email marketing program going at full speed during the transition, which might lower your revenues temporarily. Plus your team members won’t be spending all of their time on email marketing, as they invest the time to learn the new platform, and as people do their parts to make the migration happen.

The costs of empty promises
Sadly, you also have the potential of paying the costs later for empty promises now. For example, if you choose your new email service provider only to get a certain functionality that is promised to you, then later find out that you can only have it after going through the time and expense of a custom integration, you will pay a price.

Know what your costs will cover
The actual cost breakdown for switching will depend in part on how complex your current email marketing program is. The bigger and more complex your email marketing program (not your company), the higher your costs will likely be. You’ll likely get a cost breakdown that includes initial setup and integration costs. But what about data issues, rules, reporting and analytics, templates and images…all of the things you’ve set up or archived with your current ESP that you still need. What are the costs to move those over during an ESP migration? Also know who will be responsible for what during this time.

The different costs of the different stages
In addition to the breakdowns of the different parts of switching, keep in mind that not everything you’re paying for is coming from your ESP. You’ll have the cost to maintain productivity during the switch, the costs of two ESPs at the same time as you do the migration, and the costs of paying people to actually do the work, whether that’s your internal team, the ESP’s team or a third-party vendor. Keep in mind also that if you’re counting on your IT team to help with switching or integrations, you’re keeping them from other initiatives and those kinds of decisions also have a cost.

The cost of lost data
Depending on the complexity of your email marketing program, you might lose data when switching, and that data might—or might not—have a value for your organization, making it a cost. Lost data might be from engagement, click throughs, web analytics, sales funnels or triggered campaigns, or something else. (It depends on your program.)

How to keep costs down and predictable
If you want to be sure of your costs for switching up front, spell things out in your RFP. Spell things out in your RFP. Spell things out in your RFP. Did I mention you should spell things out in your RFP? Or, hire a professional to help. A third party can help with your RFP and email service provider selection, to objectively ensure that your costs are fair and in the open.

If a switch to a new email service provider is inevitable because there’s simply no way to make your current ESP work, then learn everything you can upfront about expectations and costs, and make sure to think outside the box to take into account every possible kind of expense that might result from the switch so you go into this with your eyes—and not your budget—wide open.

P.S. When you’re ready to move from one ESP to the other, take a look at these 10 top posts on ESP migration for guidance.