Small and midsize businesses around the world view email marketing as a vital component of their marketing strategy. In a recent survey of more than 600 marketers conducted by iContact (email marketing by Vocus), 91 percent of respondents said that email marketing was either helpful or very helpful to their organization. And email marketing seems set to continue to grow in importance, with 56 percent of businesses saying they plan to increase their spend on the medium in 2013
You would think that this would be great news for anyone in the email marketing industry. But at iContact, we believe there is still much more work to be done for email marketing to become a truly effective, highly efficient marketing channel for our clients. This is because—despite such high levels of confidence in email marketing—our research also shows that many marketers are not leveraging email marketing to its maximum potential. Many marketers just don’t realize that they are losing out because, as they see it, their email marketing works.
Why fix what isn’t broken?
Because email marketing is widely perceived as a cost-effective (low-cost) marketing channel that can potentially deliver returns beyond the reach of many other digital marketing technologies with very little effort, marketers can often become complacent about the medium.
It is perhaps this perception of email as a low-cost solution that works straight out of the box that prevents many marketers from really getting under the hood of email marketing and fine-tuning it to maximum effect. Undoubtedly, more costly marketing exercises like paid search or SEO would have to prove their worth and deliver optimized results to reflect their level of investment. Email marketing is not expensive, and it delivers results – so why worry?
This approach is more than a little naïve, especially when you consider email marketing (despite its low cost) actually represents the largest share of many small and midsize organizations’ marketing budgets at 15 percent.
Our survey told us that despite such high confidence in email marketing, many marketers didn’t understand:
- The return on investment (ROI) email marketing delivered into their business
- The cost of acquiring new email subscribers
- How often they should send email marketing messages to their subscriber lists
- The true potential email marketing could deliver their organization
Building Success through Understanding Email Marketing Metrics and Delivering Best Practices
If an organization is to maximize its success using email marketing, it first needs to understand several metrics:
- The cost of acquiring new subscribers: This will include costs from other marketing channels, including paid search, website optimization, events, telephone sales and face-to-face marketing. Organizations should factor the acquisition of new subscribers into almost every aspect of their marketing and sales strategies. The more efficient they are at building their lists, the more cost-effective email marketing becomes.
- The cost of creating campaigns: It may cost very little to physically send an email marketing campaign, but there are other costs involved. Time is perhaps the most expensive component of email marketing. How much is the effort you are putting into list growth and segmentation, content creation and monitoring success costing you in man hours? Could technology or professional support help you manage your time more effectively.
- The cost of old data: Email marketing might offer a low-cost marketing solution, but paying to target old, disengaged or dead email addresses is simply plain expensive.
Email Marketing Metrics:
- List quality/size/segmentation: The quality of your list and how it is segmented will always be more important than its physical size. The bottom line with list quality and segmentation is that the more targeted your campaign is, the more successful it will be. Understanding this will allow you to send out more campaigns to smaller groups of people. Email marketing has the potential to work for you throughout the working week/month/year far beyond an irregular newsletter or badly targeted offer.
- Opens/clicks/bounces: This information goes way beyond “nice to know.” If you want to improve your email marketing success, it is imperative that you understand how you can influence these metrics. Try not to benchmark yourself against widely published industry standards – many of your competitors might not be following best practices. Instead, learn from your previous efforts and constant try to improve through regular testing of subject lines, content, images, offers, calls to action, etc.
Understanding Your Email Marketing ROI
Only when you fully understand the above metrics will you truly understand the potential ROI email marketing can offer. iContact offers a wide range of educational resources to help you follow email marketing best practices and deliver optimized results.
For more information and to raise your email marketing IQ, visit here.
Learn how marketers are using email marketing in 2013 by downloading The Small and Midsize Business Email Marketing Survey 2013.
This post first appeared on the iContact Blog.
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