Rebranding a free E-mail domain - strategic blunder

I am using several free e-mail services, mainly for reasons of insufficient quotas. But for more then 7 years, my primary e-mail address hasn't changed.

It is a free service hosted by a local telco provider, with only 100 MB quota and relatively poor spam protection. I have maintained it simply because a huge number of my contacts and registrations on different sites on the Internet is bound to this address. It is like maintaining a mobile phone number on an expensive mobile telephony provider simply because it is the number that everyone knows.

Yesterday i received a memo by the telco provider, that it will go through a rebranding process. This rebranding process will include the change of the domain name of the free e-mail service. All incoming emails to the original domain will still be received, but all outgoing e-mails sent from a webmail interface will be with a sender@new-domain.com. And all this change will happen in 2 weeks!

The idea of the telco provider is that using this change in domain name they will immediately raise the profile of the new brand.
Naturally, you give something for free in order to gain something else (customers of other service, media attention, brand recognition) . In a free service, there are 2 types of customers: the casual users, which just registered because it is free, and comprise 80% of all users, and the power users, which actually use the service as their primary service, and comprise the remaining 20%. It is the power users that frequently circulate e-mails with a certain brand thus promoting the brand.
It is the power users the operator wants, not the freebie hunters.

But here's the rub: lets analyze what a power-user of a certain e-mail service does

  1. He/She is subscribed to automatic services or mailing lists. All automatic services are only validating a command if it is received from my original registered e-mail address.
  2. The partners and friends of the power user usually have e-mail rules in their mail clients which manage e-mail based on the sender address.
  3. It is not a small effort to attempt to inform all the persons with which one communicates of the e-mail domain rebranding. Such information will again be sent through e-mail, and may or may not be noticed and read on time by the person, leading to unread or lost e-mail.
  4. It is an even larger effort to try to find all services to which one is registered, and re-register the new e-mail address. For some of these services the user has forgotten the passwords, for others, the process of re-registering is horribly complicated in order to protect the members - especially for organizations like chamber of commerce, or guild organizations.

So here is what I expect to happen:

  1. The casual 80% will most likely ignore the entire event, or adopt it without too much fuss, but they will use it as much as the previous one - almost not at all.
  2. The power users 20% will accept the inevitable, but will analyze which e-mail service to communicate to the world and use in the future. As i said before, the service offered by the provider is a joke compared to Yahoo or Gmail.

Now, i understand that this is a free service and as such, the operator has the right to rebrand it. However, they have created a scenario similar to a mobile telephony provider telling you that you MUST change the phone number due to some rebranding. Faced with that fact, a lot of users will flock to a better/cheaper service. The churn of the power users will be significant to say the least.

I do not have an insight into the product and brand management strategy of the telco operator, but it looks like a very poor strategic decision.

Talk back and comments are most welcome

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