80% of Marketers Will Increase Digital Budgets in the Year Ahead

It’s not easy being a direct marketer today: so many channels, so much data, and so little intelligence or talent to figure out how to work out an efficient multichannel strategy. According to the Direct Marketing Association’s newly released “2015 Statistical Fact Book,” four out of five marketers will increase their spends on digital this year and the preponderance of them (45%) will focus on social media marketing as their biggest area of opportunity. Coming in second was email, named by 40%. But another table in this annual treasure trove of PowerPoint fodder shows that marketers find email to be not only their most effective Internet tactic, but also the most easy to execute. The most difficult?  Social media—though the channel finished third (behind websites) as “most effective.”

The DMA’s annual Fact Book is a compendium of essential research in the field—300-odd pages of tables and charts broken down by categories. The Association culled the intelligence from 75 sources, among them Google, Return Path, the U.S. Postal Service, and Experian.

Direct marketing is an exciting, variegated, and opportunity-filled field—if one has the data analytics, the strategic vision, and human talent capable of navigating it. “Poor data quality, that’s the issue that’s at the forefront today,” says Neil O’Keefe, DMA’s SVP of CRM and member engagement. “Marketers are wrestling with getting a clear view of the customer. There’s significant difficulty in bridging the gap across email and social media.”

Poor data quality was the chief obstacle between marketers and a complete customer view, according to an Experian Marketing Services study included in the book. It was followed by siloed departments, inability to link different technologies, and lack of relevant technology. Not surprisingly, another study by Mondo showed that three of the top five hires marketing departments are looking to make this year are in social media, data analytics, and mobile strategy.

“Understanding how to build out the tech stack is a much bigger challenge today than it was just a few years ago,” O’Keefe says. “There’s a lot of leaning on agency partners. Big retailers are borrowing staff from supplier partners, but they still lack the broad knowledge.”

But for an elite few, that is. Limited pools of tech talent often flow to technological innovators. Another Experian study, which tracked mail, phone, and Internet buyers over a period of three months, found them overwhelmingly engaged with three Internet pioneers. Amazon accounted for 30% of the field, followed by Apple (iTunes and Apple Store) with 12%, and eBay with 10%.

So, while direct marketers will be spending more time and resources attempting to harness new technologies and burgeoning channels, they also will continue to ride hard an old workhorse: email. “Email marketing continued to deliver exceptional ROI because people continued to respond positively to the commercial messages that reached their inboxes. They simply liked what marketers sent,” Return Path CEO and DMA board member Matt Blumberg wrote in an introduction to the book’s email section.

Indeed, complaints from consumers about emails are few, according to a Return Path study. Entertainment companies heard the worst of it, but the worst wasn’t so bad—only 109 gripes per 10,000 emails sent. Retailers heard only 63 complaints, travel companies 70, and financial firms 84. In a Listrak study of email subscribers, 82% said they wanted more emails as long as they were relevant, 77% said they’d likely buy more if their mail was personalized, and 69% said they were willing to share more personal information in return for that relevancy.

Another notable development in this year’s Fact Book was a higher intention on the part of marketers to step up responsive design efforts, largely due to a change Google made in its algorithm that favors mobile-friendly sites in search results. Although mobile marketing strategies are a must in a time when more than half of searches are initiated on devices, the channel remains expensive. O’Keefe cited a Merkle study showing that the cost of clicks produced by mobile ads increased by 20% in Q4 2014, while the price of tablet clicks rose by only 4% and desktop clicks by 11%.

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