E-mail Now More Profitable, Survey Shows
E-MAIL use is becoming more profitable.
The average amount of revenue generated from an online buyer grew from $168 in 2001 to $208 in 2002, while the cost to acquire a customer online fell $8 to $30 during the same period, according to a study by the Association for Interactive Marketing (AIM) and Return Path Inc.
Some 64% of the respondents said that most of their e-mail revenue comes from transactions. Forty percent said they derive revenue from ads, sponsorships and banners.
Twenty-four percent have e-mail databases with 50,000 to 500,000 records, compared with 14% last year. But data capture is not as strong as it could be: 61% have e-mail addresses for only about half of their customers.
Marketers are fairly conservative when it comes to how often they send e-mail. Nearly 60% contact their customers no more than monthly. Many also enable their customers to indicate how often they would like to be contacted.
More than 75% use e-mail for promotions, product announcements and e-newsletters. Only 17% use it for billing, statements and invoices.
While opt-in still appears to be the standard, many respondents have moved toward opt-out. Of those surveyed, 57% said they use opt-in or double opt-in to obtain customer permission to contact them by e-mail, compared with 71% in 2001.
The survey showed that 64% of businesses are handling e-mail in house. The cost to send an e-mail has stabilized between 3 cents and 5 cents per message.
Marketers seemed to contradict themselves on the value of online customers and their respective e-mail addresses. While the average cost to acquire an e-mail address is about $30, only 50% of marketers were willing to pay more than $1 to get the new address of someone who has changed his or her e-mail address.
And 67% spend less than $25,000 annually on e-mail database maintenance.
The report, which surveyed 110 marketers from various sectors that perform e-mail campaigns, was released at the Direct Marketing Association’s Net.marketing conference last month in New York.
It is the second annual such study by AIM and Return Path.
