Alterian survey says 85 percent of marketers plan to increase online spending in 2007

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What's the direct marketing spending priority for 2007?

According to Alterian's fourth transatlantic annual survey of more than 500 direct marketers, marketing services providers and agencies, it's online activities. 

85 percent of respondents expect their online direct marketing expenditures to increase in 2007. The spending projection is the largest expected increase since the Alterian Annual Survey began in 2003. Alterian, Chicago, is a provider of analytics led integrated marketing software.

While online direct marketing will receive the largest investment increase, 51 percent of survey respondents also plan to boost their offline direct marketing spend in 2007. When asked about specific channel investments, 81 percent plan to increase spending on e-mail marketing, 50 percent say they will spend more on direct mail and 45 percent will increase their budgets for personalized landing pages.

Despite the strong spending indicators for both online and offline channels, 94 percent of respondents who said they will decrease offline spending said they will increase online spending.

The Alterian 2006 Survey polled a total of 540 marketing professionals. The annual survey was conducted in North America and the United Kingdom in October 2006 through a dedicated Web site landing page, a hardcopy form and in-person interviews at DMA06 in San Francisco.

The 2006 survey confirms the growing emphasis on the integration of e-mail marketing. Thirty-five percent of respondents reported that their e-mail activity was integrated with all other channels and 26 percent of respondents said their e-mail is at least integrated with other online channels. Only 18 percent reported that e-mail is still used as a standalone channel.

Despite progress on multichannel integration, an overwhelming 70 percent or respondents said they apply basic or no analysis to any of their e-mail campaigns. Only 29 percent claim they carry out full analysis. At the service provider level, marketing services providers reported the highest percentage, at 32 percent, of those carrying out full data analysis on e-mail campaigns.

Agencies have the lowest percentage of those carrying out full analysis, at 23 percent, but reported the highest percentage, at 57 percent, of those carrying out basic analysis.

The survey revealed a correlation between the level of channel integration and analytical activity. Those with the most advanced level of online and offline integration also indicated that they are performing the most advanced levels of analysis, with 45 percent of respondents topping both these segments.

Conversely, those not integrating e-mail fully with other online or offline channels are doing the least analysis, with only 12 percent of respondents using e-mail as a standalone channel completing full analysis of e-mail campaigns.

Respondents cited the challenges to improving integration. According to 36 percent, the top obstacle is that online and offline activities are managed by separate departments. Thirty-two percent reported difficulty integrating e-mail marketing activity with the customer database.

While e-mail campaigns are growing in sophistication and frequency, nearly half of marketers manage their e-mail activities in-house. Twenty-nine percent outsource e-mail marketing to e-mail service providers and 15 percent send the work to agencies. Only 11 percent tap marketing services providers.

Regarding e-mail volume, 71 percent send less than 1 million e-mails in an average month. The survey revealed that marketers are managing the largest percentage of small (less than 1 million e-mails monthly) and large (more than 10 million e-mails monthly) campaigns in-house, but tend to outsource mid-size campaigns (one to 10 million e-mails monthly), primarily to e-mail service providers, followed by agencies and then marketing services providers.

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