Stodgy Email Marketing Stomps Social for B2B Priorities, ROI

email marketing rep by pony express

Figure 1 – The Overland Pony Express to Represent Email Marketing

Even as marketers debate the efficacy of social-media marketing on Facebook and Twitter, they have no doubts about the power of a tried and true tactic to drive sales, and perhaps more importantly, ROI. The killer app is called email. Some marketers will have left email marketing behind as a no longer relevant tactic in the mad pursuit of social media marketing. That is a common and costly mistake.


Most, if not all, will agree that email marketing, while not as shiny or sexy as social media, is a very effective online marketing channel from an ROI (Return On investment) standpoint. If you can segment and personalize emails effectively, the campaign performance and ROI boost is rewarding. For many executives, ROI is the classic baseline marketing metric and the yardstick used to evaluate competing investments, not only within marketing, but across the company.


Email Marketing Leads Online Marketing Tactics in ROI


In fact according to the Direct Marketing Association, email easily outperforms other online channels in generating return. In fact, for each dollar spent by channel, the following ROI was projected (2012):


  • Email: $39.40
  • Search: $22.38
  • Display: $19.71
  • Social: $12.90




A logical follow on question for the reader to ask is why not allocate all online marketing budget to running email marketing campaigns? To answer that question, it’s helpful to look at the aggregate amount of sales driven by each online marketing channel before coming to that conclusion.


Let’s take a look.


For Driving Sales Volume, Paid Search Remains Supreme


The DMA projects 2012 sales driven by online channel were:


  • Paid Search:  $350.2B
  • Display: $186.9B
  • Email:  $67.8B
  • Social: $38.8B

2012 online sales by channel

Figure 2 –2012 Sales Share Driven by Online Marketing Channel


For 2016, the DMA projects the each online channel to drive the following


  • Pad Search:  $506.1B
  • Display: $279.2B
  • Email:  $82.2B
  • Social: $81.8B

2016 online sales by channel

Figure 3 –2013 Sales Share Driven by Online Marketing Channel


Based on the % of sales share driven by online channel, the DMA projections for 2012 and 2016 indicate that the sales driven by online marketing tactics, in aggregate, will grow from $644B in 2012 to $949B in 2016. Paid search and email marketing are projected to lose share to social, a much less mature channel than email marketing and even paid search.




So even though email marketing has higher ROI than paid search, display advertising or social media marketing, from a driving incremental sales volume standpoint, we can see that paid search is the clear leader, both today and in the foreseeable future. This makes sense  when evaluating user intent as it relates to search. People are generally much further along in their purchase journey, influenced by other channels by the time they get to search.  Therefore, businesses that rely on email marketing as their sole online marketing tactic to drive sales are leaving significant opportunity on the table. This is precisely why a balanced online strategy of paid search, display advertising, email marketing and social media marketing is advised for most clients to maximize their sales potential through a diversified online marketing portfolio.


Organic search through SEO (Search Engine Optimization) is a key area for online marketing. Bumps in the road for one channel can be leveled out by other channels, similar to financial portfolios. That said, since each channel has its own realized ROI, overall business profitability goals can, and often do, shape online marketing budget allocations.


B2B Marketers Pick Email Marketing as Their Top Online Marketing Tactic


Based on the ROI data from the DMA, it’s no surprise that a 2012 BtoB Magazine survey of business-to-business (B2B) marketers across the U.S., developed in conjunction with business audience marketing company Bizo, found that email marketing is THE top online marketing tactic based on time and resources invested.


“When asked to rank different marketing activities based on time and resources spent on each, 49 percent said they spend more time and resources on email than on other channels. Paid search was ranked second, with 36 percent, and display ads were ranked third, with 35 percent. Social media, which enjoys a high adoption rate among B2B marketers, also gets the least amount of their time and resources, with just 29 percent saying this tactic receives the largest share of their time and resources.”




Give the People What They Want

give them what they want orig

Figure 4 –Emails are the Promotional Channel of Choice by Consumers


A 2012 survey of consumer channel habits and preferences found 77% preferred to receive permission-based promotions via email, 6% preferred such messages via social media.




A similar survey of UK consumers found 69% with a preference for email as the channel of choice for brand communications.




For today at least, businesses and consumers are more inclined to engage with offers through email as opposed to social channels, probably due to context and frame of mind. When users are on Facebook, they are much more in the “friends and family” state of mind and less likely to be receptive to branded marketing messages interrupting their social interactions. After all, they are called Social Networks for a reason.


That’s not to say that a recommendation from a friend on a social network is not going to dramatically influence purchase decisions. In fact, a high-impact recommendation from a trusted friend conveying a relevant message is up to 50 times more likely to trigger a purchase than a low-impact recommendation (Source: McKinsey). To be clear, a high-impact recommendation from a trusted friend  is a world away from unsolicited advertisements from businesses or brands that we may or may not have a direct social connection with such as being a fan or follower.


Why Email Marketing Works


why email marketing works

Figure 5 –Why Email Marketing is an Effective Online Marketing Channel


Email marketing works for a variety of reasons. Through various techniques such as list segmentation and message personalization, emails can be targeted to individual groups based on providing information and offers relevant to that group.


Like most other forms of Internet marketing, email marketing is data-driven. Different aspects can be tested such as frequency of email sends, variations in ad copy, subject lines and different calls to action. With popular, affordable email management services, performance data can be tracked including:


  • emails delivered vs. bounced
  • emails opened
  • emails deleted without being opened
  • links clicked within emails
  • emails forwarded


Since email marketing is an online direct sales channel, the results can be measured in terms of incremental sales and CPA (Cost Per Acquisition) as a result of individual email campaigns.  Email marketing is a great way to build relationships with prospects and customers, fostering trust, loyalty and when the ultimate goal is realized, brand advocacy (see McKinsey quote above). Email marketing is also a great way to stay top of mind for prospects and potential customers.


Email marketing also has the ability to support/drive other sales channels. For instance, off-line sales in brick-and-mortar stores can be stimulated through coupons delivered through email campaigns. Unique coupon codes per email campaign are used so the efficacy of each campaign can be measured and evaluated individually.


Why Targeting is so Key for Email Marketing

Why Targeting is so Key for Email Marketing

Figure 6 –Why Targeting in Email Marketing Can Dramatically Enhance Results


The top reasons for U.S. email users to unsubscribe from a business or non-profit email subscription are too many emails (69%) and content that is no longer relevant (56%) (ChadwickMartinBailey).  Building lists, segmenting into groups and building targeted campaigns by group, supporting personalized messages can have significant impact on performance.


As individuals, we are much more like to engage with email marketing that is personalized based on our own context, especially if we provided that information to the marketer through an opt-in form submission. We all want to feel as though emails we receive are meant for us and only us. Through the development of customer/contact profiles, we are able to setup email marketing that can personalize the subject lines, email body and even the from field (who the email was sent from), which in practice, will often be the account executive who gets assigned the lead once it’s deemed “sales-ready.” This kind of “customer intimacy” with segmented lists can have profound impact on online marketing success, both in terms of revenue and profits.

Key Email Marketing Take Aways

email marketing - taking it to the bank

Figure 7 –Email Marketing Take Aways That You Can Take to the Bank


If you are new to email marketing, then take the time to education yourself. Like many other things in business, sometimes knowing what not do to is as, if not more important than know what to do. Some time spent learning how to avoid email marketing boobie traps will be time well spent.


Start building an email list if you don’t already have one. Placing an opt-in form on your website is a great way to start. To be safe, use double opt-in to protect from SPAM complaints. Before you know it, you will be collecting email marketing addresses like a pro.


Collecting business cards during face to face interactions and asking if you can add a person’s contact to an email distribution list used to distribute valuable content is a good tactic also. Make sure to always stay within the CAN-SPAM guidelines that the FTC uses to regulate email marketing.


If you have an email list, segment it as appropriate to make your message as targeted as possible. Make sure to keep your list contacts warm by sending valuable information on a frequency that is optimized for your mailing list (i.e. audience). Testing may be required to find the right frequency to maximize performance and minimize unsubscribes.


Remember, email marketing is the cornerstone of many business’ online marketing efforts. Past, current and planned online marketing strategies should not overlook email marketing in the quest for the latest, shiny new online marketing toy, but rather include it in a balanced online marketing strategy.


Rick Noel is an experienced digital marketer enabling businesses and organizations to grow through the Internet, while maximizing marketing ROI (Return On Investment). Rick is the CEO and Co-Founder of eBiz ROI, Inc., a full-service digital marketing agency located in Ballston Lake, NY.

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