Christmas e-mail spending increase expected: British DMA

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A new survey from the British Direct Marketing Association finds that e-mail service providers in Britain are expecting an increase of up to 50 percent in Christmas spending.

More than a third of the surveyed e-mail service providers expect a 15 percent to 25 percent increase in year-over-year spending. Nearly 20 percent of those surveyed project a 26 percent to 50 percent increase and 5 percent anticipate a jump of more than 50 percent.

The findings were included in the DMA's National Email Benchmarking Survey.

The DMA report said the Christmas e-mails will become more personalized. All the surveyed e-mail service providers indicated they were involved in some form of message personalization. An increasing number of them are building e-mails entirely on the consumer's profile.

That would explain why open rates for e-mails are up in Britain: 26 percent for acquisition and 33 percent for retention. The total click-through rate for acquisition campaigns is now 9 percent. For retention efforts it is 14 percent.

More is less

The benchmarking survey also examined the effect that the "number of times contacted" can have on campaign metric rates. Average unique and total click-through rates both decreased with the increase in the frequency of e-mail contact, the DMA said.

Another corollary to that finding was the frequency of contact's impact on opt-out rates.

When contacted only once a month, the average opt-out rate was less than 1 percent. But this rose to 3.5 percent for acquisition e-mails and 2.5 percent for retention messages when the contact was weekly.

That said, the survey showed that current customers are more likely to respond favorably to communication than prospects.

Also mentioned in the report was the increase in the number of segments in campaigns and regular communications. Weekly campaigns now account for almost a third of all business e-mails sent in Britain.

Christmas pinch

The DMA survey comes amid media reports that this Christmas "could be the worst in 25 years" for British retail, according to Richard Ratner, a senior analyst quoted from a note sent to clients.

Mr. Ratner, retail analyst at investment bank Seymour Pierce in London, attributed poor high street sales to British consumers suffering from higher interest rates, council tax increases and fuel bills. Unseasonal weather was not blamed, according to The Daily Telegraph, a British broadsheet.

British analysts had predicted a 3 percent increase in Christmas holiday sales from the 2003 period, the report said. But Mr. Ratner's sources said top retailers like Next, Debenhams, WH Smith, Woolworths and Boots haven't fared well with sales of Christmas gifts.

Mr. Ratner expects more discounting before Christmas, which is good news for shoppers. But the prognosis for retailers was dire if current trends continue.

"We now believe that Christmas in 2006 will be worse than 2005 and could be as difficult as, or even softer than 2004, which was the worst Christmas for 23 years," the Telegraph quoted Mr. Ratner as saying in his memo to clients. "If the latter is the case, it will make it the worst for 25 years."

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