Has Email Marketing Finally Evolved?

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Has Email Marketing Finally Evolved?
Has Email Marketing Finally Evolved?

For years marketing industry pundits have belabored the importance of list hygiene and management. And an entire industry has grown up around addressing email deliverability issues. It seems this message, and related email issues, finally started sticking with the C-level, according to data from Silverpop's third annual Email Marketing Metrics Benchmark Study. 

For the study Silverpop, the digital marketing software company recently acquired by IBM, examined emails sent from some 3,000 of its client brands across 40 countries. The study, which normally omits data from previous years, found that medians of list churn metrics such as hard bounces were down to less than 0.04%, a 95% drop from last year. The study placed overall median unsubscribe rates around 0.28%.

“Marketers have finally crossed the chasm. It's not just email marketers talking about list hygiene anymore,” says Loren McDonald, VP of industry relations at Silverpop and author of the study. “Marketing executives are now demanding that their teams take care of deliverability issues. That's part of the reason list churn declined so much this year.”

The overall median open rate for emails was 17.1%, though it was 16.8% in the U.S. However, transactional emails such as order confirmations or shipping updates saw a median open rate of 38.5% across all countries and industries. The top 25% of all email marketers experienced at least a 65.7% open rate on transactional emails. “Typically transaction emails are triggered, or close to real time. Consumers expect, even hope for, these emails. You cant get any more relevant, ” Silverpop's McDonald explains. “There's a huge opportunity here to increase engagement by adding dynamic content like recommendations to transactional emails. Most companies have recommendation technology in place and they can easily integrate.”

But McDonald cautions against placing too much stock in open rates. “The fact that somebody opens an email is not ultimately helpful in determining the success of an email program. You can artificially inflate opens,” he says. For example, some email clients automatically download images, generating an open even though the recipient may actually delete an email before "opening" it.

Many marketers focus instead on click-through rates, which more directly indicate engagement with messages. The overall median click-through rate during the study period was 1.5%, with consumer services (2.3%), healthcare (2.6%), and real estate (2.8%) leading the field. “Click-through is a clear demonstration of interest, but not much better than opens in terms of measuring conversions and output,” McDonald says.

For a more clear picture of output, McDonald recommends tracking the click-to-open rate (CTO). “CTO takes people who already opened the message and tracks what percentage of them actually clicked a link. It's a more diagnostic metric,” he explains. “CTO helps isolate the content within an email. It helps us understand problems with design, where links are located, are we responsive, etc.” The overall median CTO rate was 10%; highest in European and Asian countries (12.2%), and lowest in Canada (4.8%).

“Each of these metrics have a role,” McDonald says, “but you have to think of them differently and use them differently.”

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