The ROI King – email marketing
Email marketing is, without a shadow of a doubt, the most cost effective channel available today..
This is not comment or opinion; it is a cold hard fact, backed up by reams of data, statistics and experience. As with any marketing strategy, it has to be done right to be effective, but assuming that it is, the potential return on investment is second to none. Want proof? Read on:
Return on investment (ROI) is the holy grail of marketing measurements. For every pound dropped into the marketing machine, you – the diligent marketer – want to know how many pounds are coming out the other side.
Given the comparatively low cost of email marketing when compared to the likes of TV, print and digital advertising, it is safe to assume that the ROI is likely to be high; but just how high might surprise many people.
A recent report from the Direct Marketing Association (DMA), which surveyed over 1300 marketers, found that the average return on each pound spent on email was £21.48. A fifth of respondents were reporting returns of £51 or more and third said that email was responsible for at least half of all digital revenue. These are not figures that can simply be brushed under the rug.
There are those that will argue that response and engagement rates are higher from direct mail or that brand awareness is higher from digital advertising and social; but the fact is that these channels cost significantly more and when it comes to yielding a return on investment, more investment with less return is not what businesses want to hear.
Improving return on investment requires investment
The ROI, which is already staggeringly impressive, can actually be improved on. The same report states that there continues to be a disconnect between the value of email and its recognition within organisations.
With internal resources and budgets being cited as the top two constraints for email marketing, it seems that the channel is perhaps a victim of its own success. After all, if something is working, why risk breaking it?
The fact is that too many companies are spending too little time on strategy, design and optimisation, resulting in less effective campaigns. As email already offers the best return on investment, an organisation should have the best team working on it. Whether that requires outsourcing or is done internally; email demands the best strategists, the best writers and the best designers.
End-users, customers and readers have evolved and a one-size fits all strategy is simply not effective. A rinse and repeat model is required – with continuous testing and refinement, marketers can increase their ROI by leaps and bounds.
The DMA report found that, of those who test regularly, 74 per cent report having an ‘excellent’ or ‘good’ ROI, compared to just 37 per cent that do not test.
Measurability is one of the key advantages of email when compared to all other channels. How does a marketer know how many people have watched a television advert, or read a printed ad? How can they be certain that mail has been delivered and if it is delivered, whether it was ever read?
Of course, they can still calculate ROI, but many metrics are simply immeasurable. With email, a marketer can see exactly which emails have been opened, which links were clicked and by whom, as well as a host of other insightful metrics; device, operating system, time, re-open rate, to name just a few. This data allows marketers to see, in almost real-time, what is and isn’t working on a campaign. By monitoring this data, marketers can make granular changes to campaigns, which can have a monumental impact on ROI.
Long live the King
SEO, PPC, content, social media, direct mail, affiliate marketing, digital advertising…the list is endless. Despite the ever expanding array of channels and tools available to the 21st century marketer, email marketing still provides the best return on investment, bar none.
However, just because email marketing has been around for a while and continues to perform admirably, does not mean that it should be side-lined in favour of newer channels. In order to continue reaping the benefits of email, companies need to treat it with the respect it deserves, investing time and money into ensuring that it remains the ROI King.