Despite the surge of social media and chat apps, email marketing is making a comeback, with new research suggesting firms are reaping the rewards of better technology. Return on Investment (ROI) for UK email campaigns rose 53% to an average of £38 for every £1 spent in 2014, according to the DMA’s latest National Client Email report.
Almost one-fifth (18%) of respondents see an ROI of more than £70 in their email marketing campaigns, the study found.
Produced by the DMA and sponsored by DBS Data, the report shows that 90% of client businesses use email, and 90% of those clients believe email to be ‘important’ or ‘very important’ for achieving business objectives.
Benchmark figures show delivery rates, conversion rates, open and click-through rates to all have increased, while unsubscribe rates remain unchanged, compared to last year’s report.
These improved metrics could be down to advanced techniques, such as email automation with behavioural or lifestyle triggers, and better targeting, the report suggests. Clients are moving away from ‘spray and pray’ methods a more considered approach.
The importance of marketing automation software can be seen in how its use has prompted a surge in revenue. In 2012, 19% of revenue came from emails sent because of behavioural and lifestyle triggers. By 2014 this increased to 30% of revenue.
Respondents believe these trends will continue into this year. Just over half of respondents (51%) predict budgets for email campaigns to also increase over the coming year.
Sales was the main goal for 26% of campaigns, engagement for 22%, followed by acquisition on 16%, lead generation on 12%, retention on 11%, brand awareness on 7%. Conversion rates are used to evaluate campaign success for 60% of marketers.
Email marketers have concerns about data degradation – if your campaign is only as good as your data, then data is of premium importance.
DMA executive director Chris Combemale said:“Email is the oldest digital medium still in use, growing out of the early internet. Even now, an email address is one of those things that helps define you in the digital world. It has endured because it is so useful. It also works. ROI figures alone show this, rising from £24.93 last year to £38 this year. Email is resurgent.”
Key findings from the report are shown below:
Adam Williams, managing director of DBS Data said:“This survey highlights just how compelling the results can be, with 18% of respondents recording a return on investment of over £70 for every £1 spent. However, despite the returns, over half of all those polled are spending less than 10% of their marketing budget on email marketing, although spending looks set to increase for many in 2015.
“The most disturbing issue for me working as a data professional is that data degradation (29%) and lack of data (26%) were considered to be the most significant challenges to successfully executing email campaigns in 2014. With the quality of tools, techniques and data sources available to marketers today there really is no reason for these two issues to inhibit marketers. Data is very much an enabler!”