Earlier this week while preparing to discuss Digital Marketing with some prospects, I came upon an interesting article extolling the value of using email to market products. I was somewhat surprised to see a very solid return on investment (ROI) for email marketing. According to the Direct Marketing Association (DMA) for every dollar spent on email, the average return in 2011 was $40.56. The DMA estimates that the ROI for 2012 will be $39.40 and $35.02 in 2016. While it appears the ROI is falling year over year, the return against each dollar spent is still very good. Furthermore, the performance of email is well above that of search ($22.24), Internet display advertising ($19.72) or mobile ($10.51).
The use of email marketing is widespread with 68% of small businesses listing it as their preferred marketing channel according to Pitney Bowes. I have used email marketing to grow our SIP Trunking sales channel, prospect for hosted communications and upsell to existing customers. But, because it can be difficult and time consuming to collect and analyze the actual impact of an email campaign, others and I haven’t always collected the necessary data to calculate an accurate ROI.
The DMA projects email drove $67.8 billion in sales in 2012 and forecasts $82.2 billion in 2016. According to The Radicati Group the number of registered email accounts reached 3.1 billion in 2011, and is expected to grow by another 1 billion by 2015. That represents an incredible number of potential prospects across a wide range of products and services. Yet, there are plenty of naysayers about the future of email marketing but given the familiarity of the methodology to consumers and its cross platform availability, it will be long time before it is displaced entirely.
It is worth noting that the king of digital marketing continues to be Internet display advertising, which is forecasted by the DMA as driving $186 billion in sales in 2012 and $279.2 billion in 2016.
The conclusion is simple. Businesses regardless of size should use all of the digital marketing avenues available to them. My only hesitation is leveraging social media to support B2B marketing and sales. That does seem to be more relevant in the B2C world and there is nothing wrong with that.