Email Effect Lessens

    October 26, 2007

In 2005, email marketing returned $57.25 for every dollar spent. Last year it fell to $51.58. The U.S. Direct Marketing Association predicts email marketing return on investment (ROI) this year to be $48.56, the numbers show that marketers will spend about $500 million to achieve $23 billion in sales.

The Direct marketing Association estimates that the trend will continue next year. They predict ROI will drop to about $45.65 in 2008 with a total spend of  $600 million creating $27 billion in sales.

More companies are sending emails that do not generate revenue such as order confirmations and double opt-ins, which could be part of the reason for the fall on ROI.

Even with the decline in returns from email marketing, Richard Gibson, chair of benchmarking hub at the DMA Email Marketing Council, said: "Relevancy, segmentation, targeting and analysis are most definitely in the direction where email marketing has been headed for some time.

"Many suppliers or ESPs – email service providers – have the ability to work with the marketing function within a small company and show how their tools can be used effectively to increase response."