Why do eMail Marketing?

By Mark Brownlow, Revised: Nov 09 First published: Nov 06

People unfamiliar with email marketing often wonder what all the fuss is about. Didn't spam kill email as a marketing vehicle? And if spam didn't kill it, what about blogs, Twitter and all the other clever ways we can communicate online? Isn't email outmoded?

Those wondering about the benefits of email marketing in today's ever-changing online and marketing environment will find the answers below.It works

Businesses engage in email marketing because it works. And works well. Here are the numbers...

* According to research conducted by the Direct Marketing Association, email marketing generated an ROI of $43.62 for every dollar spent on it in 2009. The expected figure for 2010 is $42.08. As such, it outperforms all the other direct marketing channels examined, such as print catalogs (reference).

* The Ad Effectiveness Survey commissioned by Forbes Media in Feb/March 2009 revealed that email and e-newsletter marketing are considered the second-most effective tool for generating conversions, just behind SEO (reference).

* A summer 2009 survey of Irish marketers found 79% rating email marketing as important or very important to their marketing strategy (reference).

* Shop.org's State of Retailing Online 2009 survey of retailers found that "E-mail is the most mentioned successful tactic overall" (reference).

* In Datran Media's 2009 Annual Marketing & Media Survey, 80.4% of industry executives said the email channel performed strongly for their company. This was the top result (reference).

* A December 2008 survey of hundreds of marketers by MarketingSherpa saw pay-per-click search ads rank top for ROI, followed by email marketing to house lists in second place (reference).

* Marketing service Epsilon determined that clients were getting $0.14 revenue for each email delivered in Q3, 2008 (press release).

* A February/March 2008 retailer survey by shop.org revealed that email marketing has the second lowest cost per order (CPO) of any online marketing tactic. The CPO of $6.85 compares favorably with, for example, paid search's CPO of $19.33 (reference).

* A 2008 survey by Newsweaver and B2B Marketing Magazine of 175 UK B2B marketers revealed 78% considered email "critical" or "very important" to their B2B marketing strategy (press release). Newsweaver also surveyed Irish marketers, and 78.1% said that email is either "important" or "very important" to their overall marketing strategy (article).

The money is following the results...

* A November 2009 survey of B2B marketers found that email marketing was likely to see more spending increase than any other form of online marketing bar website development (report).

* A Q2 2009 survey of over 5,000 senior US executives revealed that email marketing was the channel most likely to see an increase in marketing budget (see press report).

* 46% of North American small businesses surveyed in 2009 by Hurwitz & Associates use email marketing, with another 36% planning to do so in the coming year (press release).

* Seven out of ten UK marketers surveyed by the DMA in 2009 expected expenditure on email marketing to increase over the next 12 months (press release).

* In August, 2009, Veronis Suhler Stevenson's annual Communications Industry Forecast suggested total spend for email will grow from $11.9 billion in 2008 to $27.8 billion by 2013 (see press report).

* An April 2009 survey of senior marketing executives by the European Interactive Advertising Association revealed that 46% of respondents plan to invest more in email (report).

* In Datran Media's 2009 Annual Marketing & Media Survey, 58.5% of industry executives said they planned to increase investment in email. Only 5.7% planned to decrease it (reference).

* Internet Retailer's April 2009 email marketing survey found that 51.6% planned to increase spending on email during the recession, and only 4.7% planned to decrease it (reference).

* Shop.org's State of Retailing Online 2009 survey of retailers found that 88% of them list "e-mail as a high priority for the year" (reference).

* A 2009 survey of US B2B marketers by MarketingProfs and Forrester Research found that 39% planned to increase email budgets, while 11% planned a decrease (reference).

* The CMO Council's Marketing Outlook '09 Report reviewed the plans and opinions of 650 marketers. Email marketing was the top target area for investment in 2009 (press release).

* A survey of B2B marketers in November, 2008 noted that 68.3% intended increasing spending on email marketing in 2009 (reference).

* The DMA estimate spending on email marketing (in the USA) will increase from $600 million in 2008 to $700 million in 2009 (reference).

* A 2008 survey by Forrester Research revealed that 95% of surveyed marketers use email marketing, with another 4% planning to do so by year end (see reference).

* In a 2008 survey of 200 corporate markters, 74% said they would increase spending on email campaings over the next three years (article).

Why it works

Email marketing works for a variety of reasons...

* It allows targeting

* It is data driven

* It drives direct sales

* It builds relationships, loyalty and trust

* It supports sales through other channels

Modern email marketing services and solutions support database integration, segmentation and various other tricks and techniques for improving the targeting of outgoing messages. Advanced methods generate on-the-fly emails customized down to an individual recipient basis.

And every email campaign you send out generates a heap of actionable data you can use to refine your approach and messages.

Email promotions and offers generate immediate action: sales, downloads, inquiries, registrations, etc. Informative email newsletters and other emails send people to offline stores and events, prepare the way for catalogs, build awareness, contribute to branding, strengthen relationships, encourage trust and cement loyalty.

All in all, a pretty good way of going about your marketing business. But...

Let's not get carried away

Just like a garden only bears fruit if managed properly, so it is with email marketing. We know it can work, but you have to get the basics right. The basics of building a list of people who want to hear from you, crafting a message, and ensuring the emails get through to those on that list.

And once you have the basics right, there's a whole spectrum of more sophisticated tactics you can employ to drive further success. Because the metrics show us that there's plenty of room for improvement and plenty of rewards waiting for those who do improve.

For example, one report found that "using web analytics to target email campaigns can produce nine times the revenues and eighteen times the profits of broadcast mailings."

At a simpler level, just mailing a small coupon offer to customers who hadn't purchased for a while brought in a tonne of extra sales for one retailer.

Convinced? Start the email marketing journey with a look at the basics of email marketing.

Need more email marketing guidance? Try the email newsletter or blog.

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