Experts Weigh in on How to Expand E-mail Programs
With marketers increasingly recognizing the power of e-mail marketing, spending on the channel is expected to show double-digit growth for the foreseeable future. However, industry experts differ on how the increased budgets should be spent.
Marketers are expected to spend $500 million on e-mail in 2007, a 25% increase over 2006, according to the DMA. E-mail marketing spending is expected to grow at a compound rate of 20.2% a year until 2011.
So where should marketers sink their e-mail money?
Rachel Bergman, senior vice president of client services for e-mail service provider CheetahMail, said that for many marketers, the answer is simply expand the program.
“There are a lot of companies who aren’t hitting their customers as often as they should,” she said. She added that most marketing departments could benefit by simply increasing e-mail-marketing related staff.
“In general, as I look around at our clients, we do think that they’re understaffed for the programs that they want to run and for the programs that they should be running,” she said. “E-mail is an amazing medium where you can literally send 10 million people on your list a completely different e-mail, but that’s not that easy to do. You have to put time, energy and effort into it.”
Companies’ e-mail teams “are for the most part not large enough and that’s why they’re not growing as quickly as they should.”
However, the industry’s youth and growth will make finding e-mail-marketing talent a challenge in the near future, according to JupiterResearch’s E-mail Marketing Buyer’s Guide released last week. The average number of years of experience across all e-mail service providers is 4.4, according to JupiterResearch.
“Finding qualified e-mail marketers to assist with services — either hired internally or procured through ESPs — will be a frustrating, but unspoken challenge during the next few years,” said the report.
Scott Olrich, vice president of marketing for e-mail service provider Responsys, said most marketers need to entirely rethink their approach to e-mail in order to make intelligent budgeting decisions with regard to the channel.
“The problem is most people aren’t evaluating e-mail from the right perspective,” said Olrich.
Currently, marketers typically send an average of between two and a half and four e-mails a month to each address, he said. However, most marketers “live in a marketing-centric world. They basically send out the campaigns when they want to send them.”
Eighty percent of all e-mail campaigns are sent on a static frequency, such as weekly or monthly, he said.
However, he said, marketers should be looking for event-related opportunities on which to capitalize, such as a birthday, an abandoned shopping cart, or recent product purchase.
“There are tons of opportunities to engage customers if you watch their behavior,” he said. “Marketers should be shifting more of their budget toward building a whole event-based marketing strategy around e-mail. They should be thinking about an event-based strategy as it relates to all their marketing, but why not take advantage of e-mail to do that first? It’s the least expensive, highest ROI channel.”
As a result, Olrich recommended spending more on e-mail technology. “You can’t do event-based marketing by hand,” he said. “It doesn’t scale.”
