Email Remains One of the Top Revenue Generating Channels – How Do Your Email Strategies Stack Up?
Email, like every marketing channel, has undergone major transformations over the years. Yet for those companies who are keeping up with the email revolution, email marketing brings in a hefty ROI. According to Econsultancy, email marketing was ranked as the best channel in terms of ROI (68%), an increase of 3% from last year. The same study found that, on average, companies are attributing 23% of their total sales to email marketing. According to a report by the Direct Marketing Association, email marketing yields an ROI of 4,300% for US brands.
In a December 2015 report by Strongview, email marketers stated their 3 most important email marketing initiatives for 2016 as follows:
- Increasing subscriber engagement
- Improving segmentation and targeting
- Improving data analysis to better understand customer context
Despite the best of intentions, many email marketers are struggling to realize the full potential of their email programs. A report released earlier this year by GetResponse, “State of Email Marketing By Industry” surveyed 1,831 marketers in a variety of industries and analyzed more than 700 million emails. According to the results, a third of email marketers don’t optimize their email marketing and only half test their subject lines. The report also found that a full 42% of marketers don’t use any form of segmentation and send everyone on their list the same email. Additionally, only 4% use behavioral and survey data for personalizing emails and targeting.
The 21% of survey respondents who are optimizing their email strategies saw a positive return on investment. Other survey finding include:
- On average, the top benefit of email marketing for 23% of those surveyed is lead generation, followed by improved sales (19%) and improved conversion rates (17%).
- About a quarter of the respondents test alternate offers and 18 percent test different layouts and creative.
- Fifty-seven percent of marketers intend to increase their email marketing budgets this year, while 28% will stay put.
Another study by Ascend2 also reported similar findings in regards to the challenges email marketers are facing. Low click-through rates topped the list at 53% as the most challenging obstacle. Other challenges include:
- 41% – Lack of an effective strategy
- 32% – Lack of quality content
- 31% – Lack of internal resources
- 28% – Lack of list hygiene
Email has the potential to be a top revenue generator if you know where to begin. Here are 5 practical tips to help increase your marketing ROI.
1. Optimize for Mobile
I can’t stress the importance of this enough but your emails must be mobile-optimized. According to Salesforce’s 2015 State of Marketing report, 66% of emails are opened on a mobile device. Your customers will delete your emails or unsubscribe from your lists if your emails aren’t formatted for mobile consumption. There are tons of resources available on best practices for optimizing for mobile such as the best title length, graphic usage, and ways to use copy. Also check out Litmus who has an email preview tool so you can view how your email renders on over 40 email clients and devices.
2. Personalize Your Communications
Emails with personalized subject lines are 26% more likely to be opened and marketers have found a 760% increase in email revenue from segmented campaigns. While many marketers understand the value of personalization, many are unsure where to begin. However not using some type of personalization and segmentation can lead to 50% of people unsubscribing from your lists, according to research by Silverpop.
Effective email personalization requires data. Start with the low-hanging fruit – the 1st party data you already have at hand. Use first names and other demographics and behavioral data you may have on hand such as age, gender, geography, and transactional history. Are you emailing customers or prospects? Are they high-value customers that can be rewarded with special offers or have they not made a purchase in a while and would be most apt for a retention email program? Append 3rd party data for deeper insights into behavior, interests, lifestyles or to add missing data elements to your file.
A report by The Relevancy Group analyzed the data elements that marketers used most often to segment and personalize their email campaigns. 41% indicated demographic data, 39% used geographic data, with additional respondents citing customer satisfaction survey data (34%) and clickthroughs on email offers (33%) as the top data elements.
3. Clean Your Email Lists
Like all data, email lists go bad. People move, change their names, and leave jobs. Or if you have missing emails, an email append solution can match email addresses to postal addresses. A third party solution provider can also validate addresses by flagging potential undeliverables, and autocorrect syntactical errors, identify spam traps and complainers. If you are going to take the time to invest in your email strategies, be sure you are using the best list of names and emails possible through a regular maintenance program.
4. Automate Your Campaigns
Today, the relationship customers build with your organization is far from linear. They research and connect with your business many times, across different devices and touchpoints. An email marketing automation platform helps ensure that you don’t miss a beat and are managing and automating crucial touchpoints along the customer journeys based on each individual’s behavior. For example, emails can be personalized and automatically deployed based on if customers have visited your website, browsed certain product categories, opened certain emails, clicked on specific offers, have an abandoned cart, and so on. While many marketers report that they are using some sort of automation, it is important to continually analyze gaps where automated email content sent at the right time can further drive conversions.
5. Test and Analyze
Email marketers test their subject lines more than everything else but you need to think bigger. Yes, an email subject line is hugely important but there are many elements to a successful email program that should also be taken into consideration. Check out this graph from MarketingSherpa’s 2013 Email Marketing Benchmark Report. The survey asked participants to answer the question, “Which of the following email campaign elements do you routinely test to optimize performance? Please select all that apply.”
In addition to subject line, it is important to continually test and analyze the call-to-action, message, day of the week sent, layout and images, time of day sent, and other key attributes.
Email marketing is about more than sending every customer or prospect every email offer, coupon, or company announcement. Email can be a powerful tool with the right mix of data and when strategies are optimized and tested.