Email has become a crucial weapon for organisations that are trying to increase the effectiveness of their marketing efforts during the recession, according to the '2009 Email Marketing Census' study by E-Consultancy and Adestra.
The study found that 78% of corporate marketers now rate email as "excellent" or "good" in terms of the ROI (return on investment) it achieves (up 12% in one year). Email also scored higher for ROI than any other digital marketing channel.
However, the study also noted that significant numbers of marketers are still failing to adopt a range of best practices relating to email marketing, and that many are still failing to get to grips with deliverability issues. Less than one-fifth of marketers (18%) said they know what percentage of their email budget is lost through non-delivery.
At the same time, a lack of email strategy is now more likely to be a significant barrier to effective email marketing (44%), up from 32% one year before. An even larger proportion of agency-based marketers (69%) said that this is a major barrier for their clients (up 16% from the previous year).
According to E-Consultancy's research director, Linus Gregoriadis, "While some companies are mastering various tactical elements of email best practice such as segmentation, deliverability, list cleansing and triggered emails, it is clear that there are still problems for many organisations at a strategic level. A well thought-out email strategy has to be the starting point for email marketing success."
The study suggests that email has become a crucial marketing technique during the recession because, when it's executed properly, it can deliver an exceptional return on investment compared to other digital marketing channels.
On average, 42% of emails (by volume) sent by the email marketers surveyed were acquisition-focused, compared to 58% for retention-based messages. Additionally, there has been a 9% increase in the proportion of marketers now re-marketing through email, as they attempt to squeeze as much value as possible from existing customers.
Worryingly, however, 42% of email marketers said they had not quantified their return on investment from email marketing. According to Henry Hyder-Smith, managing director for email service provider Adestra, "This is very concerning because email is perhaps the most cost effective medium, accounting for only 14% of online marketing budgets. With many marketers recording ROIs of over 600%, budget constraints should not be seen as a barrier."
Among the survey's other significant findings:
- Application Service Providers (i.e. externally hosted email systems) are now the most commonly adopted method of email marketing, with nearly half of company email marketers (47%) using this approach. The use of a web-based application interface has also increased greatly over the past two years
- 75% of respondents are now carrying out basic segmentation, with a further 19% of company email marketers planning to do so in the future. The next most commonly undertaken email marketing practice is regular list cleansing, currently undertaken by 60% of companies.
- The majority of email marketers (72%) said they are not using email marketing as effectively as they could. Only 16% are using email as effectively as possible for acquisition, compared to 24% for retention.