Retailers shift their ad spending from TV, radio and print ads to digital ads.
More online marketers are looking to e-mail not just for direct response, but for branding too, says eMarketer, mirroring a trend in online advertising away from an obsession with click-throughs to a recognition of the importance of brand advertising.
In an increasingly crowded online advertising environment, click-through rates on e-mail are now down to about 1.8% from around 3% last year, according to researchers eMarketer Inc. But marketers who gauge the effectiveness of e-mail campaigns solely by click-through or even conversion rates are missing the boat, eMarketer says.
“Click-throughs are an inadequate and almost ancient metric for measuring results,” says David Hallerman, senior analyst at the research firm, which will release a report on e-mail marketing this month. “Measurements for both sides of the aisle-–direct response and branding-–are needed.” There are other ways people can respond to an e-mail than by just clicking through to a web site, Hallerman says, including direct offers calculated to drive recipients to the phone or store, or to bring shoppers to the marketer’s web site at another time.
That thinking about the role of e-mail marketing is part of a growing change in thought about the role of Internet-based advertising. From an obsession with click-throughs, the marketing industry is slowly shifting to an attitude that image advertising counts after all. A recent study from University of Chicago researchers showed that exposure to online ads overall increased consumers’ likelihood of buying when they were presented with a direct offer to click through.
“And that’s just for direct offers. More and more, we’re seeing that e-mail marketing is being used for branding,” Hallerman adds. Examples of branding strategies using e-mail include opt-in e-mail newsletters with content of interest to the receiver. “There isn’t necessarily a click-through or any other direct response solicited, but the customer is reading the newsletter, feeling positive about the company because it has given him something of value, and is seeing the company’s name,” he says.
When e-mail campaigns are targeted and the customer has said specifically to the sender that she wishes to receive e-mail from the sender, click-through rates do go up. “But even then, the volume of e-mail is just increasing,” says Hallerman.
Many marketers remain heavily focused on click-through and conversion rates to gauge campaign effectiveness, but surprisingly, there are still some who don’t measure e-mail campaign performance at all. According to IMT Strategies data from last fall, 51.8% of U.S. marketers measure neither click-through rates nor conversions, while 41.9% measure both and 6.4% measure only click-through rates. “They’re not bothering to take advantage of the tools,” says Hallerman.