New Research Shows Email Marketing Still Delivers Impressive ROI

According to the DMA's newly released Power of Direct Report, commercial email now returns $43.62 for every dollar spent on it in 2009. Granted that's down $1.31 from last year, but it's still double the ROI of search advertising, which is the next most effective channel with an ROI of $21.85 for every dollar spent.

The fact remains that email remains a powerful direct marketing channel that generates real results. Despite the Wall Street Journal's infamous proclamation of email's demise, consumers continue to embrace it to communicate with friends and businesses.  In fact, when it comes to sharing marketing offers and overall communications with businesses, consumers overwhelming choose email over social media.  A recent MarketingSherpa study showed that 78% of consumers share online information via email, versus 22% who prefer social media, and a Harris Interactive poll found that an even higher percentage of consumers choose email to communicate with marketers over social media.

These statistics point to the health of email, but they don't mean that social media isn't experiencing tremendous growth in adoption and utility.  Instead of choosing one channel over the other, marketers should look at ways to use them together. There are already natural connections between the two.  A recent Nielsen study found that the more people use social media, the more time they also spend with email.  That's not too surprising when you consider that social networks rely on sending their members email to keep them updated of new content updates and other changes.

When it comes to social media marketing, StrongMail has also seen a big impact from integrating social media into existing referral campaigns. By making it easy for consumers to share referral rewards with their networks and then track the results of their efforts, these integrated campaigns have generated significantly higher results than relying on email alone.  Using this approach, CSN Stores generated a 3X lift in performance over its previous email campaign.

The bottom line is that email remains an extremely prevalent and useful communication tool that is well suited for direct marketing; however, marketers would be remiss not to see how social media can help augment their existing email marketing campaigns.  Remember, when it comes to choosing an effective direct marketing strategy, it doesn't have to be an either/or scenario.  Leverage email and social media for both their intrinsic and combined strengths, and your bottom line will thank you.

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Monetizing Social Media
Proven Strategies for Driving Revenue and New Customer Acquisition

Type: Live Webinar
Date: November 18, 2009
Time: 11:00am PT / 2:00pm ET

Embracing social media without a proven strategy is more likely to drain resources than drive revenue.  However, with the right approach, marketers can effectively leverage social media as a powerful channel for driving revenue and customer acquisition. 

Integrating social media into an existing program is easier than you think.  Join this interactive webinar and learn first-hand how companies have generated impressive results by creating compelling campaigns that tap the viral nature of social media. Plus, get your questions answered in an interactive Q&A session.

Register Today >>

Speakers
Kara Trivunovic, StrongMail
Sr. Director of Strategic Services

Matt Stewart, Zecco Holdings
Marketing Associate

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Maximize the effectiveness of your email marketing campaigns by adopting the cutting-edge strategies, best practices and trends featured in the third installment of the Email Breakthrough Report. See how leaders in your industry are leveraging the power of email to drive maximum satisfaction and value from their customers.

The Power of Automation to Drive Relevance and Efficiency

Organizations are always asking marketing departments to do more (drive more leads, website visits, online transactions) with less (budget, staff, services). While this tendency drives its fair share of stress, the positive byproduct has been (and continues to be) innovation in direct marketing technology.

In fact, as a result, it's easier than ever for marketers to do more with less. The trick is finding the application of technology that makes the most sense for your business. From an email communication perspective, a great place to start is automation. If you are not automating a good portion of email communications, you may be missing a chance to be more relevant, timely and efficient. If you're not sure where to begin, this primer should help you get started.

Email Stream Analysis
Start by completing an Email Stream Analysis. It's no surprise that successful email marketers typically have a firm grasp on how their businesses use email across the customer experience. The stream analysis is simple to complete; answering these 5 questions is more than enough to uncover some exciting automation opportunities.

1. Identify all communication streams delivered to consumers or clients via email. This means everything from a purchase confirmation to customer service announcement.
2. Determine the data source for each stream of email, and more importantly, who owns it.
3. Determine the trigger of each communication, and classify the current state as automated or manual.
4. Determine the purpose of each communication. Is the message focused on customer support, brand marketing, ecommerce, etc.?
5. Determine the opportunity to enhance the customer experience in each stream. What elements of the program can be tweaked to optimize results?

Now that you know what email your organization is sending, it's time to consider what email you're not. For example, working with one of our clients, our Strategic Services team walked through a typical customer's online experience with the brand in a given week. From the recipient of promotional messages to casual visits to the online store through the shopping cart processes, we identified opportunities for communication that were not currently being leveraged. We added these to the current programs to the email stream analysis.

Once we have a comprehensive view of current and potential email programs, we "stack rank" each stream based on its automation opportunity. Current automated programs are at the top, programs with high automation potential come next and low automation potential comes last.

As a marketer, how do you determine high vs. low automation potential? The answer is in step 3 of the email stream analysis. Wherever a trigger event sits within or is tracked by an application (ecommerce, Web analytics, CRM, data warehouse), the automation potential is high. Whenever the triggering event sits outside a system and is controlled by a manual process (submission of newsletter content from authors, development of "one-off" email creative), the automation potential will be low.

Automation Strategy
Finally, you are ready to consider your automation strategy. At the top of your list are system-generated messages that are already automated within your business. This is the low-hanging fruit. These communications are already automated. The trick is to enhance the use of these streams by embedding marketing value into them. Many companies are taking advantage of these streams and automating the delivery of a number of marketing communications within these transactional streams. Web services technology and flexible integration options have given marketers unprecedented access to these streams.

Next on the list are system-driven messages, or email streams that are being sent manually today that could be triggered by systems or data sources. These streams will require some work to automate, so the key is to pick those that offer tangible benefits to program performance. Here are a couple of relevant examples:

Preference-based promotions: Many companies are starting to leverage preference centers to gather information from their email subscribers. The problem is the data gathered is not always focused on improving program performance. For example in working with one Internet retailer, we presented the concept of "Gift Reminder Preferences." Allow a subscriber to input dates (birthdays, anniversaries, holidays) for specific personal relationships (son, spouse, parent), and the email solution can deliver these "Reminders to Buy" at incredibly relevant points in time with very impressive conversions.

Shopping cart abandonment: Too few eTailers take advantage of the data captured by their web analytic systems. Simply triggering automated offers as shoppers abandon carts could increase program results by 50%. If you have web analytic tools and work with a sophisticated email technology provider, these programs need to be at the top of your automation wish list.

At this point, you have taken already automated email communications and put them to work for marketing. You have identified undeniable ROI for a few additional email streams and automated those as standalone programs (preference-based promotion) or as part of an existing customer workflow (cart abandonment emails).

Now you're on to stage three: looking for automation opportunities in those streams you considered as having a low automation potential. While some of these streams will never be fully automated, look for stages within email program development that can be more efficient. Some examples include:

Dynamic content previews: If you have a cumbersome process for testing the placement and "look" of dynamic content across a set of data, look for tools that automate this process as part of the campaign workflow. You shouldn't have to send test emails to 30 unique contacts at 30 unique addresses; this should be part of the email-creation process.

Enhancement of email wireframes: If you are creating several versions of a template for a single program, odds are you are not leveraging dynamic content to its fullest. Wherever possible, each program should be supported by a single wireframe that automatically brings in variable attributes based on customer data.

Integration with web content and content management systems: It is not uncommon, especially in newsletter applications and promotional email, to have content that is already available online. Many companies have identified ways to link email templates to already available content, shortening production and proofing cycle times.

Regardless of what streams you end up automating, the opportunity is there. However, like anything else, you will need to:

• Do some research (email stream analysis).
• Do some brainstorming (walk through the customer experience).
• Do some analysis (categorize streams based on automation opportunities).
• Do some prioritization (choose to automate those streams with the highest potential ROI.)

If you follow these steps, you can rest assured that the results will be well worth your effort.

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Engagement Metrics Play Increased Role in Deliverability

If you're responsible for email deliverability at your organization, you probably already know how important is it is to authenticate your mail.  ISPs are continually looking for ways to protect their members from unwanted spam and malicious email attacks, and a lack of email authentication is one of the key factors considered in their filtering protocols.  It's also widely known that deliverability is affected by sending to too many bad addresses or having a high complaint or "this is spam" rate. However, what you may not know is that ISPs are increasingly looking at engagement metrics to filter your mail.

All the factors mentioned above still play a role, but major ISPs such as AOL, Yahoo, Microsoft and Google have either already started or plan to start filtering based on a wide range of pre-defined engagement metrics as well. This means that if you're not closely monitoring your engagement rates such as clicks and opens, you need to start now to protect your overall sender reputation.

As far as what ISPs are looking for, a recent blog post by Return Path recently outlined four key areas that they are using to help determine inbox placement.  These include use of the "This is NOT spam" button, panel data, trusted reporter data and number of inactive accounts.  Return Path provides more detail on these four areas in its blog, but the required response from senders is the same. 

In order to maximize deliverability, you need to make sure your email is not viewed as spam – whether by content or frequency – and you need to make sure your list hygiene practices are solid. Removing bad addresses is not enough. You need to make sure that you are not sending email to inactive accounts and segment your lists based on user engagement so you can easily weed out unengaged subscribers whose inaction might be impacting your deliverability.

The bottom line is that ISPs are trying to protect their members from unwanted messages. If you make yours "wanted," you've won half the battle.

You can keep up with these developments and more by bookmarking or subscribing to StrongMail’s blog, Maximizing Deliverability.

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