10 ways to maximise returns on email marketing
Thursday, 27 March 2008
Last Updated: Thursday, 27 March 2008
By Brad Howarth
As marketing budgets shrink in the slowdown, it is a good time to revisit the tried and true strategies like email marketing.
Search engine marketing and social networks may be the hot topics of online marketing, but some of the most effective tools are also the oldest. Email marketing is far from a dead medium, with service providers reporting strong growth from existing and new clients.
Email marketing is regaining its popularity as it is a cost effective tool that can be easily tracked, says Mellissah Smith, the chief executive officer of the marketing services agency Marketing Eye.
“Integrated marketing campaigns incorporating email marketing as the centralised point is proving a better bang for your buck,” Smith says, “but only if done correctly.”
The market is jammed with companies offering services for crafting your communications, along with hosted software packages that enable you to handle the entire process yourself.
On average, the cost-per-message rarely exceeds five cents after the initial sign-on fee. It’s a better price than packaged direct marketing, which can easily exceed $1 per item.
According to the managing director of the Sydney web company HotHouse, Simon van Wyk, the three key factors in making email marketing work are frequency, value and motivation. Getting any one of those wrong will see your communication dumped in a spam folder.
The executive director of the online direct marketer Impact Data, Brett Hogarth, believes how well the messages are targeted is the strongest determinant of the return.
“Sending to a smaller number costs less, and ensures value to recipient,” Hogarth says. “Ongoing perceived value to the recipient ensures higher ongoing opening rates.”
Gerry Gibbs Camera House sent an offer of 10 cent photographic prints to 11,606 customers which resulted in a 627% increase in customers over the campaign’s first three days, and produced a 458% increase in processing volume.
Another campaign run for Strike Bowling Bar asked recipients to nominate three friends to join the Strike database in return for a free double pass. This resulted in a 42% increase in new registrations.
Hogarth says more advanced users are tying their email communication into other systems, such as point-of-sale customer relationship management, to automatically generate and distribute offers to new customers, or to segment existing customers based on purchasing activity.
Hence specific events can be used to trigger highly targeted offers.
The business director of digital marketing agency XYZdirect, David Bradbury, says the days of measuring pure return-on-investment have given way to measures of engagement and effectiveness, such as message open and click-through rates.
“We tend to measure to conversion, whether it be [intent] to purchase or another action, such as acquiring more data on a prospect,” Bradbury says. “Where we do measure to ROI, we'd say the average for every $1 spent, [would be to] seek to get $1.50 back.”
Story continues next page: