October 17, 2004
Why Email Will Win the Day
I attended the same presentation as Fred where a great B2C marketer talked about how she got a 40:1 payback for every dollar spent on email marketing versus an 8:1 payback on search. As head of an email marketing company, it was music to my ears.
But the “finite issue” Fred highlights is actually a great opportunity more than it is a drawback. Most marketers still have email addresses for less than 25% of their full customer database, meaning that if we do our job as an industry, we should be able to increase the availability of email addresses threefold in the coming couple of years. With the inevitable scale efficiencies in email marketing, that 40:1 number can become much bigger, maybe even as high as 100:1, over time.
The challenge for the industry is that this kind of transformation isn’t easy. A lot of the low-hanging fruit of early online adopters is gone. This means marketers are going to have to do more to embrace permission and drive organic list growth if they want to keep pushing the email ROI metric forward. Not necessarily brain bending stuff, but there aren’t a lot of shortcuts for it, either, and it requires a different mindset than traditional advertising and direct marketing. In the end, it all comes down to respecting the consumer and delivering the value exchange to customers.