Those companies carrying out basic segmentation and testing are significantly more likely to be getting a high level of return on investment from their email marketing campaigns, according to research by Econsultancy and Adestra.
The Email Marketing Industry Census 2012, now in its sixth year, also found that companies integrating their email activity with other business areas, including CRM and sales, are much more likely to be generating positive financial returns from the channel.
According to the research, only 31% of companies surveyed regularly test their email marketing campaigns.
But 81% of companies who do regular testing for email marketing say their ROI from email is “excellent” or “good”, compared to 72% for those who do “occasional” testing, 65% for those who do “infrequent” testing and only 37% for those who “don't test”.
The study, sponsored by Adestra, also found that companies who are practising basic segmentation are 95% more likely to rate email ROI as excellent or good than those who do not use even basic segmentation, nor have plans to do so.
This year’s Email Census is based on the findings of a survey of more than 800 digital marketers. Since 2007, this research has surveyed both those working directly for companies (i.e. in-house or client-side), and those supporting them on the supply-side (i.e. email service providers and agencies).
Econsultancy Research Director, Linus Gregoriadis said: “This research has given us an unparalleled opportunity to observe the trends and changes within the industry over the past five years. This year, for the first time, we have shown that companies observing some basic best practices are reaping the rewards when it comes to ROI from email marketing.
“While one would intuitively expect this to be the case, we hope that this research prompts more companies to invest more effort in a marketing discipline which is often neglected, despite its effectiveness. Put simply, those simply performing ‘batch and blast’ techniques are less likely to see ROI benefits.”
The research shows that those companies who have their sales and conversion data “well integrated” with their email activity are 49% more likely to consider email as offering an excellent or good ROI.
Meanwhile, those whose CRM and customer data are well integrated with their email marketing are 48% more likely to consider the ROI of email to be excellent or good.
Henry Hyder-Smith, Managing Director at Adestra, added: “Last year’s census clearly showed a ‘back to basics’ approach is vital to develop successful email marketing, however it appears marketers are not heeding the (‘don’t-run-before-you-can-walk’) advice.
“This year, delving deeper into the data, shows a direct result of using best practices is better ROI. So doing more segmentation, more testing, and integrating email with CRM/web analytics/sales data, all show significant revenue growth. Get the basics right, and you will sell more.”
The research also found that, five years since the first such report, email is still seen as a channel that offers a good return on investment, with 70% of company respondents rating email as “excellent” or “good” in terms of ROI. No other channel, except SEO, is rated so highly. For comparison, only 44% believe social media offers an “excellent” or “good” ROI.
Furthermore, supply-side respondents consider email to be the most effective channel for their clients in terms of return on investment, with 81% believing it to be “excellent” or “good”.
However, despite this positive news, companies are not exploiting email to its fullest potential.
Only 40% of responding companies use their email service provider (ESP) for anything more than the basic broadcast of email. Given the wealth of tools to measure, optimise and improve this channel, it seems that few are taking full advantage of these services.
The research shows that companies using an ESP for more than just the basic broadcast of email are 32% more likely to rate the channel’s ROI as “excellent” or “good” than those who do not use any additional functionality.
Other key findings:
-) Only 3% of company respondents and 5% of supply-side respondents state they (or their clients) have adapted their campaigns on account of priority inbox features increasingly used by consumers.
-) Almost half of all company respondents (44%) either had no data security policies and processes in place, or were not aware of any.
Only 2% of both client-side and supply-side respondents ranked data security as one of the three areas they need to focus on most in 2012.
-) Less than a third of companies carry out email testing “regularly”, with the proportion of companies saying they don’t test at all increasing by 3% since 2011.
-) 39% of companies view email and social media as “complementary channels”, an increase from 35% since the previous year.
Journalists and bloggers can email Linus Gregoriadis for a complimentary copy of the report and / or further information.
Linus Gregoriadis, Research Director, Econsultancy
(e: linus AT econsultancy.com)
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Founded in 2004, Adestra set out from the beginning to be the most respected Email Service Provider (ESP). Today, Adestra is a market leader, with offices in Oxford, London and New York. Over 300 organisations globally and more than 4,500 marketers across both B2C and B2B sectors work with our technology, people and deliverability solutions to generate effective email marketing that delivers results.
Why not give us a call on +44 (0)1865 242425 or email us on to discuss how we can help you to deliver results on your email marketing campaigns.
Published on: 1:16PM on 6th March 2012