Direct mail is still king when it comes to allocating marketing budget, but e-mail use has steadily made inroads and ranks second, according to a new survey.
More than half of the respondents plan to increase their e-mail budgets, while only 5% plan cuts. In contrast, only 16% reported e- increasing their direct mail use, compared to 33% that indicated they are paring it back this year, according to the survey by e-mail marketing firm e-Dialog in Boston, MA.
Marketers are setting aside just over one quarter of 2002 marketing budgets for direct mail, down from 28% last year. E-mail, which accounted for 18% of respondents’ budgets last year has jumped to more than 24%. The channel was followed by broadcast advertising such as television and radio (13%), non-email Internet advertising (10%), and telemarketing (9%). Other outlets, such as events and sponsorships, made up the remainder.
Just under half surveyed said that e-mail is a set part of the marketing mix: 7% indicated they hadn’t tried it at all, citing budget constraints, lack of personnel, no buy-in from upper management or their fear of being perceived as a “spammer” among the reasons for their reluctance.
Thirty-one percent of those using e-mail indicated that their click-through rates run between 10% and 20% for each campaign, and 25% reported generating between 5%-10%. Fifteen percent said fewer than 5% clicked through their messages. Nine percent indicated that more than 20% of their targets did.
The majority of respondents (40%) said they closed between 1% and 5% of the sales to recipients that clicked through, while one in ten said they did so less than 1% of the time. Seventeen percent converted sales between 5% and 10% of the time, and 9% did so with more than 10% of all click throughs.
Among those using e-mail, nearly one third said they were coordinating their programs in-house on a homegrown system, while 26% are coordinating in-house through an ASP. Nineteen percent are using installed software within their offices to manage their campaigns. Seventeen percent are outsourcing it to an e-mail specialist, and 6% are outsourcing it to an advertising or interactive agency.
Respondents named “acquiring new customers” as the top goal for their e-mail campaigns. As e-Dialog noted, e-mail has proven to be much more effective in extending current relationships than creating new ones. Deepening existing relationships came in a close second, followed by selling products and service, disseminating information and shortening purchase cycles.
The list of challenges facing e-mail marketers contains the usual suspects. Finding good prospect lists or obtaining e-mail addresses ranked first and second. But marketers noted that creating good content for the messages had proven to be a headache, outstripping back-end problems of measuring results and other technical challenges.
Asked about their personalization efforts, 45% said they customized the salutation, and nearly that many (44%) tailored the subject line. Forty-three percent customized the offers, and 31% changed the entire message content to fit the recipient. Twenty-two percent modified the images, or the overall look and feel, of the messages.
E-Dialog’s research, management and analysis division e-mailed the survey to 5,120 subscribers to an e-mail marketing newsletter. Twelve percent clicked through to the survey site, and of those half finished the survey for a total conversion rate of 5.9%. The study’s findings were based on 302 unique individuals.
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