New numbers showing the ROI and value of email marketing to organisations

How do you bridge the gap between email's value and the failure to recognise this value?

As a marketer, what do you associate with email marketing?

The traditional media impression is one of an ageing Labrador: reliable, steady, still capable of doing a good job, but not really where the action is these days.

And then there's the go-getting reality.

Here are some key numbers that popped out of the UK DMA's recent National Email Client Report, which surveyed 250 brand marketers on how they feel about email marketing and its role, how they use it and what results they're getting…

Is email still relevant in a multichannel, mobile and social world?

89% said email marketing is "important" or
"very important" to their organisation.

It’s just about those traditional generic promotions and newsletters, though?

One-size-fits-all email accounted for under a quarter of email-sourced revenues, while trigger-based campaigns were driving over a fifth of this revenue.

But email metrics are in trouble, no?

Under 12% said open, click and conversion rates dropped
in 2012. The majority reported increases and even more
expect increases across 2013.

Just how good is it for revenue?

The estimated average return on each pound spent on email was £21.48. A fifth of those reporting ROI figures were getting returns of £51 or more. For around a third of respondents, email was responsible for at least half of all digital revenue.

Is that all?

Respondents also placed significant emphasis on email’s role for retention, engagement and brand awareness.

Now we can argue about specific numbers, survey bias and similar, but the picture is clear: email marketing is doing a great job for marketers.

But of course it’s not all good news.

There's still plenty of untapped potential. The number of respondents using welcome emails was still a minority and the same marketers expressing email’s value also note that internal resources and budget are still the top constraints to further success.

In a time of financial austerity, those top constraints are probably familiar to most marketers regardless of which channel we're talking about. Nevertheless, there is still a lingering disconnect between the value of email and its recognition in the media and among senior executives.

To some extent, email is a victim of its own success. Senior managers may ask why investment is needed, when results are apparently fine with current budgets.

Another issue may be a failure to internally communicate email marketing’s benefits properly. This point was highlighted by MineThatData’s Kevin Hillstrom at a recent conference I attended.

Kevin’s argument was that email marketers and the email marketing media often focus on metrics specific to the email world, notably opens and clicks. We can get a little trapped in our own world of CTRs and inbox deliverability rates.

Broader appreciation for email marketing within an organisation comes when you describe email’s contribution in a language people outside email marketing better understand. Examples are increases to web visitor numbers, order numbers, revenue, registrations or coupon redemptions.

So rather than citing a CTR of 5.6%, the email marketer should say:

“We sent 45,897 visitors to the website with our
summer fashion email”

And rather than highlighting a conversion rate of 2.1%, the email marketer should say:

“Our summer fashion email produced £245,000 in sales”

As well as ensuring better internal support for email marketing budget requests, proper communication of email’s wider contribution also gains the goodwill of affected business units. Retail staff are more likely to collect customer email addresses if they know how the company’s email marketing is directly benefitting store sales, for example by promoting in-store events.

Author’s note and disclaimer. I wrote the commentary on the survey results for the DMA report so know the figures well! Labradors from Flickr's creative commons.