Facebook, Twitter and cell phone messaging might have stolen all the glitter, but the Internet's original killer app, e-mail, continues to outshine those glamour technologies in the marketing game.
In a survey of 3,000 U.S. marketing executives late last year, 58.5% said they planned to increase their spending on e-mail marketing this year, says Datran Media, an online ad services firm.
Meanwhile, the Direct Marketing Association, an industry group, late last year forecast that the amount of money spent on U.S. e-mail marketing will jump 20.7% this year to $700 million -- bigger percentage growth than any other direct marketing channel.
For the most part, marketers are referring to "opt-in" e-mail marketing, where users have chosen to get e-mails sent by the advertiser. The other types of e-mail marketing are ads on e-mail sites, such as Yahoo Mail or Hotmail. A third type -- unsolicited e-mails -- is better known as spam, a whole different category.
In the recession, where retaining customers is crucial, many advertisers consider opt-in e-mail a better investment than other types of online ads, says Chad White, research director for Smith-Harmon, an e-mail services company.
"It's definitely because of the recession," he said. "Right now businesses are extremely concerned about retaining customers," where opt-in e-mail campaigns can shine.
Razorfish, an online-marketing services firm, says nearly 99% of its clients use e-mail marketing. It's a staple in this economy, says David Baker, a vice president of electronic customer relationship management services for Razorfish.
"A lot of businesses in a down economy look at retention as a vehicle, because retaining your customers is much more economical than acquiring new ones," he said.
Surveys of about 600 U.S. customers of travel, retail and packaged goods companies found roughly 55% saying they were more likely to buy as a result of opt-in e-mail marketing pitches, says Epsilon, an e-mail marketing services firm that conducted the surveys late last year and released the data in March.
Consumers who request information via e-mail are great for advertisers that offer short-time deals, says Kevin Mabley, senior vice president for strategic services at Epsilon.
"Deals can expire very quickly," he said.
E-mail campaigns that give users the ability to print a coupon and take it to a store also are popular, Mabley says.
E-mail marketing accounted for just 2% of U.S. online ad spending last year, says eMarketer, but it's expected to rise to $630 million in 2013 from $472 million last year.
One reason e-mail marketing spending ranks low is simply that such advertising, all things considered, usually costs less than search ads, display ads and other types of online advertising, say people in the ad game.
But cost doesn't always equate to effectiveness.
A Forrester Research survey last year of 286 U.S. marketers found that two-thirds said e-mail is the most cost-effective marketing.
And in two separate Forrester surveys of consumers last year, 42% and 44% of respondents said an e-mail had prompted them to make at least one purchase in the previous 12 months.
E-mail is a consistent hitter, even in a recession, says Forrester analyst David Daniels. "The channel is resilient to economic downturn, in part because it is so cost-effective," he said. "It continues to inspire consumer purchases."
But e-mail marketing isn't always a winner.
In a February survey of 220 people ages 18 to 24, only 28% said they receive relevant e-mails from advertisers, says the Participatory Marketing Network and Pace University's Lubin School of Business.
The headache, says Michael Della Penna, president of marketing firm AiTi Solutions and co-founder of PMN, is that many advertisers believe more is always better.
"The volumes of e-mails have been going up, especially in retail where the mentality is 'to sell more you have to send more,'" he said. "But brands have to be very careful not to give their customers an e-migraine."
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