November 2, 2007
In Defense of Email, Part 9,732
I commented today on our partner Blue Sky Factory’s CEO, Greg Cangialosi’s excellent posting in defense of email as a marketing channel called Email’s Role and Future Thoughts. Since the comment grew longer than I anticipated, I thought I’d re-run parts of it here.
A couple quick stats from Forrester’s recent 5-year US Interactive forecast back up Greg’s points con gusto:
– 94% of consumers use email; 16% use social networking sites (and I assume they mean USE them – not just get solicitations from their friends to join). That doesn’t mean that social networking sites aren’t growing rapidly in popularity, at least in some segments of the population, and it doesn’t mean that email marketing may not be the best way to reach certain people at certain times. But it does mean that email remains the most ubiquitous online channel, not to mention the most “pull-oriented” and “on demand.”
– Spend on email marketing is $2.7b this year, growing to $4.2b in 2012. Sure, email by 2012 is the smallest “category” by dollars spent, but first of all, one of the categories is “emerging channels,” which looks like it includes “everything else” in the world other than search, video, email, and display. So it includes mobile as well as social media, and who knows what else. Plus, if you really understand how email marketing works, you understand that dollars don’t add up in the same way as other forms of media since so much of the work can be done in-house.
What really amazes me is how all these “web 2.0” people keep talking about how email is dying (when in fact it’s growing, albeit at a slower rate than other forms of online media) and don’t focus on how things like classifieds and yellow pages are truly DYING, and what that means for those industries.
I think a more interesting point is that in Forrester’s forecast, US Interactive Marketing spend by 2012 in aggregate reached $61b, more than triple where it is today — and that the percent of total US advertising going to interactive grows from 8 to 18 over the five years in the forecast.
The bigger question that leaves me with is what that means for the overall efficiency of ad spend in the US. It must be the case that online advertising in general is more efficient than offline — does that mean the total US advertising spend can shrink over time? Or just that as it gets more efficient,
marketers will use their same budgets to try to reach more and more prospects?