Why do email marketing?

PushSend · Apr 14, 2011

Here's a breakdown of the numbers behind email marketing. If you weren't convinced to get into email marketing before, maybe this will give you the push that you need.

Why do email marketing?

By Mark Brownlow, Revised: March 2011 | First published: Nov 2006

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...

â– 72% of respondents to an Econsultancy survey in early 2011 described email's ROI as excellent or good. Only organic SEO scored better (reference).
â– According to research conducted by the Direct Marketing Association, email marketing was expected to generate an ROI of $42.08 for every dollar spent on it in 2010. As such, it outperforms all the other direct marketing channels examined, such as print catalogs (reference).
â– The ForeSee Results 2010 report on the effectiveness of social media found that promotional emails were the second biggest influence on retail website visits. The biggest influence was familiarity with the brand (reference).
â– A MerchantCircle survey of over 8,000 local business owners in the US found email marketing cited by 35.8% as a Top 3 most effective marketing or advertising method. Only social network profiles and search engine marketing scored higher (reference).
â– In Datran Media's 2010 Annual Marketing & Media Survey, 39.4% of industry executives said the advertising channel that performed strongest for them was email. This was the top result (reference).
â– 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).
â– A summer 2009 survey of Irish marketers found 79% rating email marketing as important or very important to their marketing strategy (reference).

The money is following the results...

â– A January 2011 survey by BtoB Magazine found 63% of respondents likely to increase spending on email in 2011 (second only to websites) with 29% keeping spend constant (reference).
â– The 2011 Digital Marketing Outlook Survey from the Society of Digital Agencies revealed that 70% of brand marketers planned to invest in email marketing in 2011. This was the joint highest result (reference).
â– A DMA survey of US and Canadian marketers in late 2010 found email was the most widely used web-based direct marketing technique (reference).
â– A late 2010 customer survey by Campaigner found 61% intending to do more email marketing in 2011, and 33% planning to continue at the same level (reference).
â– A 2010 survey of 2,500 marketers by AWeber found 82% intending to increase their email marketing efforts over the next 12 months (reference).
â– The 9th Annual Merchant Survey (2010) conducted by the e-tailing group asked merchants to say which initiatives they would be using to improve website performance. The top answer, cited by 79%, was "send more targeted email" (reference).
â– A December 2009 survey of 300 email marketers by Silverpop found that their companies were feeling the effects of recession, but "four out of 10 marketers reported that their email budgets in 2010 would increase, and nearly half (47 percent) said their budgets would stay the same" (see press release).
â– A November 2009 survey of senior marketing executives by the European Interactive Advertising Association revealed that 61% of respondents planned to invest more in email (report).
â– 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).
â– 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).
â– 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).

Why it works

Email marketing works for a variety of reasons...

â– It allows targeting
â– It is data driven
â– It drives direct sales
â– It builds relationships, loyalty and trust
â– 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 as far back as 2005 already 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.
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Why do email marketing?

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