Email atop the ROI charts
Though marketers may seem to have had a love-hate relationship with email as digital has matured, the channel continues to rule the roost for ROI.
Almost three-quarters (73%) of company respondents rate email marketing as ‘excellent’ or ‘good’ when it comes to ROI. This is up from 66% in 2015. Only 5% rate email poor for ROI. This figure is as high as 26% for display advertising.
Email marketing and SEO (organic search) have vied for the top position in the last three years. This year, email marketing wins by 9% (returning ‘excellent’ or ‘good’ ratings).
On average, organisations in 2016 are spending 15% of their total marketing budgets on email (see chart below). Both spend and attributable sales increased on 2015.
Over the past five years, the survey data shows a correlation between proportion of marketing budget allocated to email and subsequent proportion of sales attributable to email. Though this is perhaps an obvious relationship, it may show an under-appreciation of the channel. Only 15% of the marketing budget accounts for 23% of total sales.
Indeed, DMA research in 2015 calculated an average ROI for email at £38 return for every £1 spend.
Kath Pay, Founder & Senior Consultant at Holistic Email Marketing, issued a call to arms:
Email marketing as a channel is becoming more advanced and consumers are very happy with it (as verified with the revenue and ROI results), it’s now up to the brands to allocate more budget and resources to this successful revenue-generating channel and see how much more revenue they can gain.
Automatic for the people
Though email solutions are easier than ever to use, there’s still a lag in the uptake of automation, which can be complex or require lots of planning.
Relevance is clearly a target for marketers this year, with 34% focusing on ‘automated campaigns’ in 2016, 24% on ‘segmentation’ and 22% on ‘personalisation’. Five point increases in those planning for ‘automated campaigns’ and ‘personalisation’ show these two areas to be burgeoning quickest.
Jordie van Rijn, eCRM and Email Marketing Consultant at eMailMonday, emphasised the importance of having a strategy in place to reap the returns on automation:
I am not surprised to see a bigger need to focus on automated campaigns and email marketing strategy. Traditionally, these are steps towards the more advanced tiers of email marketing.
Automation equals processes and technology, but it depends heavily on the strategy for it to be truly successful.
However, for all the attempts to craft content that better suits user need, Tim Watson, Email Marketing Consultant at Zettasphere, warned of a lack of focus on list quality (21%):
Rightly, the common element to many of the survey responses, this question included, is the move to more behavioural and automated email.
This is for good reason: combining automation and broadcast, and using behaviour to drive both, is the current gold standard for email.
However, the focus on list and data quality needs to be higher, it underlies all of email marketing and in my experience does not get enough review and strategic attention.
The Email Marketing Census is based on an online survey of 1,150 respondents in February and March 2016.
The sample included both in-house marketers (66%) and supply-side respondents, including agencies, consultants and vendors (34%).
For more on this topic, download the Email Marketing Industry Census 2016.