No Matter How You Torture it, E-mail Still Works—Like Gangbusters

It’s no secret that marketers spend piddling amounts of their budgets on e-mail and that it returns an astronomical return on investment—$48.29 for every dollar spent, according to the latest figures from the Direct Marketing Association.

Now comes news that that littlest, most disrespected and abused marketing channel is driving a comparatively astronomical percentage of many companies’ sales.

Just over 46% of sales and marketing executives said e-mail drove between 10% and 20% of their firms’ sales either directly or indirectly, according to a recent survey by e-mail marketing software firm Salestream Software.

Also, just under 33% said e-mail is responsible for between 5% and 10% of their sales; and 11.8% said e-mail drives less than 5%.

However, a not-insignificant 9.1% credited e-mail for more than 20% of their sales, according to the survey of 1,829 executives conducted in August and September.

At the same time, respondents reported devoting small percentages of their budgets to the channel.

Just under 25% of those working for companies with 1,000 or more employees said that their firms devote less than 2.5% of their marketing budgets to e-mail, according Salestream’s survey.

The vast majority, or 58.5%, of those who work for larger firms reported that between 2.5% and 5% of their marketing budgets are spent on e-mail. Meanwhile, 16.9% said between 5% and 10% of their budgets are devoted to the channel.

Not surprisingly, smaller firms reportedly devote more of their budgets to e-mail marketing.

Sixty two percent of those surveyed who were working for firms of fewer than 1,000 employees said e-mail accounted for between 5% and 10% of their budgets, while 8.6% put the number between 2.5% and 5%; 24.1% reported that e-mail took up between 10% and 20% of their budgets, and 5.3% said the channel accounted for between 20% and 25% of their budgets.

The study adds to an already mountainous pile of evidence that e-mail is by far the most effective weapon in the average marketer’s arsenal, yet it gets little or no respect from senior management in most firms.

Moreover, the vast majority of marketers still apparently think of e-mail in terms of broadcast campaigning when every scrap of evidence indicates that tailored messages far outperform generic blasts.

For example, of those surveyed who used it, 63.4% rated sales follow-up to individuals and groups as one of their most effective e-mail campaign tactics. Also, 60.1% of marketers who sent targeted e-mails to segments of their lists ranked the tactic as most successful, according to Salestream.

Moreover, 49.1% of those who sent event-triggered e-mails rated it as a most effective campaign tactic.

However, just 23.8% said they used event-triggered e-mail during the preceding 12 months; 36.6% said they tracked sales follow-up e-mails; and 51.4% said they had targeted e-mail to smaller segments of their lists, according to the survey.

At the same time, 90.1% indicated they broadcast campaigns to their entire files, 78.2% said they broadcast e-mail newsletters, and 71.6% said they sent demographically targeted e-mail.

As a result, executives at Salestream—whose product is PoliteMail software—apparently spend a significant portion of their time convincing clients to refine their e-mail campaigns.

“We talk to our customers about really understanding their customers,” said Ian Meredith, chief technical officer of Salestream. Each e-mail interaction with customers should be part of an attempt to refine the communications with segments of a marketer’s customer file, he added.

“They’re going to be smaller lists, but the conversion rates will be off the charts,” he said.