While the Internet has opened new marketing channels for small-business leaders, it also has generated challenges. One of the biggest challenges is identifying, contacting and keeping customers.

In two recent surveys by Information Strategies, Inc. (ISI), respondents indicated that they can increase new business by as much as 20% on an annualized basis by creating effective e-mail campaigns. Moreover, from existing clients, the increase in new business generated by creative-contact e-mail campaigns was nearly 40%.

These studies, and others by e-marketing groups, show that maintaining constant contacts with potential and existing clients via e-mail is an effective sales tool, even in this economy.

Said one Midwestern parts supplier during a focus group, “We instituted a program that touches our clients once a month, and we saw the results in under three months.” He added that the initial cost, in terms of dollars and employee time, was repaid within four months. “We then took every e-mail lead we had and sent a biweekly fact sheet that included a tip on using one of our products and a listing of one or two specials we were running,” he added. “From this initial seed list of 1,400 names, we got 24 new orders in the first six weeks, as well as 620 new sign-ups.”

Another focus-group participant, the owner of an upscale salon chain, said she used e-mails collected at her physical locations to start up a new e-mail program. “We started with a prom special in June of last year offering a special ‘prom party’ program that went to 7000 teenage customers,” she said. “From that group, we got twenty five ‘parties’ that generated $12,500-plus in sales that week,” she reported. This Syracuse, N.Y., entrepreneur then launched a Thanksgiving and Christmas program to which she directly attributed $53,000 – and probably more – in additional income.

Experts suggest that companies do the following:

* Always ask for e-mail addresses on orders and requests and on the company Web site.
* Keep the list up-to-date and mail at least once a month.
* Always offer the opt-out option on any mailing.
* Train employees to ask where the order or sale originated, and track results.
* Encourage recipients to refer other possible recipients.
* Make sure to use a reliable agency, like Evolve Media, to manage the e-mail accounts. The relatively minor costs will be repaid with efficiencies and avoidance of problems with Internet regulations.