E-mail marketing has proved to be one of the more resilient areas of the online advertising industry, but its clients are often undermining their success through bad business practices and missed opportunities, according to a study from AMR Research.
The study found that companies considering an email marketing program are often unsure about whether to use a full-service shop, an ASP or an in-house software package. In fact, many enterprises are so conflicted about the process that 42 percent use more than one solution concurrently.
The decision need not be that difficult, according to the study. Each solution, naturally, requires different levels of involvement and deployment time, and offer varying levels of data control — with in-house software requiring the most set-up time, effort and costs, but guaranteeing a company’s control of its own consumer data and the possibility for customized applications.
Concerns about relative returns on investment, or ROI, should represent less of a consideration in the decision, however. AMR found ASP solutions and licensed software packages produced generally the same ROI. That’s in spite of the fact that average software users spent $21,500 per month on email marketing, nearly three times more than did the average ASP subscriber.
As a result, study author Kevin Scott said clients’ deployment model should be based “more on the level of security desired and how strategically you view your campaign data, rather than on cost or forecasted ROI.”
Another area in which marketers are dropping the ball is in terms of collecting email addresses. Opt-in house lists typically generate better results than rented lists, though AMR reports that 38 percent of marketers fail to mail to internally developed lists. In large part, Scott found that’s because they aren’t familiar with procedures for collecting a list, such as through Web site registrations, product registration cards or contests.
The process of testing and “tweaking” campaigns — optimizing their frequency and creative elements for maximum effect — is a time-tested practice of offline direct marketers.
Yet online marketers routinely neglect to track their best-performing assets. Company newsletters prove to be the most effective form of generating click-throughs and customer acquisitions, generating rates of between 11 percent and 19 percent. Nevertheless, Scott said, they’re far less likely to be measured or tracked.
“Inboxes have become loaded with offers for products and services that recipients have no use for,” Scott wrote. “Somewhere in the rush to the inbox, marketers have lost the basic concepts that made them successful. Since emails are much cheaper than direct mail, all of a sudden, the ‘throw it against the wall and see what sticks’ strategy seems like a good idea. It’s not. You run the risk of confusing and upsetting your customers, making each mailing less and less effective.”
Despite several glaring shortcomings in the practices of many companies using email, most have recognized the effectiveness of multichannel marketing, and are using it successfully.
Most marketers, for instance, also follow-up on email campaigns with more traditional methods, such as direct mail or telemarketing. That’s often critical to a campaign’s success, since integrating online and offline efforts can boost response rates dramatically.
Of the 62 percent of marketers that integrate their traditional and interactive efforts, almost two-thirds reported an increase of between 5 percent and 10 percent in their response rates. Furthermore, 16 percent saw an increase of 11 percent or more.
Reprinted from internet.com’s Internet Advertising Report.