Study: $2.1 Billion to Be Spent on E-Mail Marketing in 2001

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The money spent on e-mail marketing this year is expected to increase 110 percent to $2.1 billion from $1.1 billion a year ago, according to a study released yesterday by New York-based Internet research firm eMarketer.


The "E-Mail Marketing Report" also found that there is a significant difference in click-through rates between opt-in e-mail and banner ads. Opt-in e-mail has an average click-through rate of 3.2 percent, compared with 0.3 percent for banner ads.


According to the study, more than 1 billion e-mail messages of all kinds are sent daily in the United States. Both unsolicited and permission-based e-mail is significantly cheaper than traditional marketing methods, including telemarketing and postal direct mail. The average cost per e-mail message in the United States is less than 1 cent, compared with $1 to $3 for telemarketing and 75 cents to $2 for direct mail. Total ad spending for traditional direct marketing is expected to be about $40 billion by 2003, according to eMarketer. Telemarketers are expected to spend $668.8 billion this year, according to the Direct Marketing Association.


"No marketing communications medium exists that is more targetable, customizable and more flexible than e-mail," said Jonathan Jackson, a senior analyst at eMarketer. "E-mail direct marketing, when done correctly, can overcome the limitations of traditional direct marketing by offering limitless targeting ability at pennies per e-mail and allowing marketers to have a one-to-one conversation with each of their customers."


The study also stated that e-mail users in the United States outnumber Web users by 10 percent, with 96.6 million e-mail users and 87.9 million Web users. About 80 percent of all responses to e-mail marketing messages come within 48 hours, compared with six to eight weeks for traditional direct marketing methods.


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