European marketers plan to spend more on e-mail marketing in the coming year, driven by increased interest in optimizing the channel and utilizing more segmentation and targeting. Validating what I know from my company’s own work in Europe are the results of a 23-country study from FEDMA (Federation of European Direct and Interactive Marketing) released in April 2010. The study has a bit of a bias toward B2B marketers, with 56 percent of the respondents in that category.
Spend on e-mail is forecast to grow, with two-thirds (66.2 percent) of respondents expecting to increase their investment in e-mail marketing. Only 3 percent would expect to decrease their spend. Similarly, 72.3 percent plan on sending more e-mail messages in the coming year. Some of this will be simply higher frequency – many respondents report intention to move from monthly to weekly newsletters, for example. Marketers also report that they see higher response and subscriber value from more targeted promotions, and so intend to focus more effort in segmentation and content creation. Given the low cost and high ROI of e-mail marketing, and the continued economic pressures across the globe, e-mail consistently is a priority channel among marketers in every geography.
In order to maintain that ROI, marketers must contribute to the health of the overall e-mail marketing channel, said Nick Martin, a British digital marketing entrepreneur who presented the FEDMA study findings at the U.S. DMA’s Email Marketing Conference in November. Good health includes permission standards, strict management of customer databases, the relevancy of campaigns, and careful application of local laws, he said.
“If greater spend is driven by higher volumes in conjunction with looser qualification of who receives what and how often, then it follows that more people will receive less relevant unsolicited commercial email and Return on Investment (ROI) will drop,” he said at the conference. “Successful growth can only come through careful stewardship of customer information databases, and developing the use of email further into the consumer/ buyer engagement process.”
Marketers may or may not be paying close attention to creating relevancy, but respondents in the study believe that their use of e-mail marketing is improving: more than half (56 percent) believe their click-through rates will increase in the coming year. Just 8 percent of respondents expect their click-through rates to decrease.
Marketers believe their messages to be welcome, with about half (49 percent) predicting their opt-out rates will stay steady. Another 22 percent believe opt-out rates will decrease and 18 percent predict they will increase.
Other key benchmarks include:
- Open rates reported by ESP participants in the survey are all over the place, reflecting diversity among the respondents as well as various practices among marketers. About 20 percent of respondents see open rates between 5 percent and 15 percent, and 8 percent see between 15 percent and 20 percent. The most (26 percent) see open rates in the 20 to 25 percent range, and another 19 percent see open rates in the 25 percent to 30 percent range. About 17 percent see even higher, in the 30 percent to 40 percent range, but only 11 percent see rates above 40 percent.
- Click-through rates reported by ESPs are equally varied. Twelve percent of respondents see click rates less than 2 percent, and 18 percent see between 2 percent and 4 percent. The largest segment (37 percent) see between 4 percent and 10 percent click rates and another 24 percent report between 10 percent and 20 percent. Only 9 percent see higher than 21 percent.
- Both open and click-through rates reported here are averages across Europe. The study does provide some detailed benchmarks by country as well as by type of campaign. For example, while 46 percent of ESPs report open rates in the 20 percent to 30 percent band for all client campaigns, that falls to 24 percent reported by marketers for acquisition-related sales campaigns, and rises to 42 percent for customer product survey campaigns. Similarly, marketers report click-through rates of 30 to 50 percent when associated with customer marketing, retention campaigns, and surveys.
- List quality, measured by hard bounce rates, is also varied. About 15 percent of all senders in the study see hard bounce rates of more than 7 percent, and 19 percent experience hard bounces between 3 percent and 7 percent; the largest segment, 30 percent, report hard bounce rates of 1 to 2 percent.
- Hard bounce rates do vary by country, with France, Germany, Spain, and Italy all reporting hard bounce rates of less than 2 percent, while Sweden, Norway, Belgium, and the United Kingdom report averages of 4 to 6 percent.
- Just over half (56.7 percent) of respondents deploy e-mail marketing using in-house systems.
- While few respondents use e-mail marketing for win-back campaigns, those who do report conversion to sale or action between 2 percent and 5 percent.
While there is a solid foundation of success reported here, if e-mail marketing is considered strategically important, that must translate to more strategic execution. European e-mail marketers, like their counterparts all over the globe, still struggle with creating relevancy, integrating and utilizing data within privacy protection bounds, and automating triggered messaging for key touchpoints like post purchase/download or free trial conversion. I hope this means we’ll see more testing and exploration of integrated marketing technology in 2011 in order to achieve higher subscriber satisfaction, response, and revenues.
What are your key initiatives in 2011, in Europe and elsewhere? Please let us know in the comments section below.
Amazon is well-known for sending emails just for you. But a business doesn't have to be Amazon-sized to successfully deploy the same strategy.
Instead of launching a fully-formed new program, try innovating in increments, where you make a series of small changes that eventually add up to something big.
Toy retailer The Entertainer recently reported some impressive figures, including 120% growth in mobile sales and a tripling of its email revenue. ... read more
Email marketing is far from perfect. It often gets given short shrift when something new and shiny and… well… social comes along, ... read more