I’ve often said that the total business impact of email marketing is much greater than what is actually measured. The reason is the “halo effect” that email marketing has in driving action at multiple points of contact.
Chad White’s article in today’s Email Insider provides compelling evidence that email marketing ROI is actually much higher than the $43.52 predicted by the DMA for 2009.
White, who is Research Director for email marketing agency Smith-Harmon, and editor of The Retail Email Blog, cites three reasons why email marketing ROI is understated:
- Email marketing is nearly as effective at driving action offline as it is in driving action online. According to Forrester Research, 44% of all email subscribers are inspired to take action online versus 41% offline.
- Even online, where it's easiest for email marketers to track the path of subscribers, email does not get credit for much of the action it drives. According to Epsilon, 33% of permission-based email recipients say they usually visit sites directly, instead of clicking on an email link. This means conversions may be undercounted by 50%.
- Taking into consideration that email drives both offline and online sales, email marketing's ROI is probably closer to $130 -- about three times the DMA's estimate. And that's not counting email's ability to drive interest and actions in other channels like catalogs and social networks.
Email Usage Continues to Grow
In my June 18th post, Email Solidifies its Reputation as the Backbone of Direct Marketing, I reported that spending on e-mail marketing in the U.S. will grow steadily to $2 billion by 2014, according to a new forecast by Forrester Research. It’s easy to see why.
When you stop and consider how email influences and improves the performance of other media -- both online and offline – why would you not use it to anchor your marketing campaign strategy?
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