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Email Marketing Study: Marketers Demand ROI - But Most Of Them Don't Know How To Measure It

By Matt McKenzie, Senior Editor

A new study from MarketingSherpa shows that B2B email marketing is often an exercise in contradictions. That's especially true for marketing organizations that increasingly demand hard ROI from their email campaigns – even though most of them aren't actually able to measure ROI.

MarketingSherpa surveyed more than 2,700 marketing organizations to compile its 2012 Email Marketing Benchmark Report. It found that 68% of the marketers polled say they do not have a method for quantifying their email marketing ROI.

"It's difficult to determine the financial contributions of an email marketing program to the C-suite unless you have a reliable method to quantify email's impact," wrote W. Jeffrey Rice, Senior Research Analyst for MarketingSherpa, in an article detailing the finding.

"While it may be a formidable task for marketers to collect the needed data," Rice stated, "in these economic times it is critical that organizations have a method to quantify ROI to justify an investment in email marketing."

A New Focus On Hard ROI
According to the study, nearly two-thirds of CMOs now expect to use "financial return on investment" to determine the value of their email marketing programs – a significant increase from 2011. At the same time, other value metrics, including post-click metrics and email performance metrics, are now considered less useful for measuring the value of email campaigns.

The study also found that 67% of the marketers surveyed expect to spend more on email marketing in 2012, and nearly one in five will spend at least 30% more than they did in 2011. Just 3% of the respondents said they plan to spend less on email marketing in 2012.

Some other key findings from the survey include:

-        Marketers cite "growing and retaining subscribers" as their top email marketing priority, with "delivering relevant content" coming in second place.

-        The most commonly cited email marketing challenge is "integrating email data with other data systems," and many marketers also cite inadequate staffing and skills as barriers to success.

-        Mobile-ready content is gaining prominence, as 33% of B2B marketers say they now craft email that is optimized for tablets and smartphones.

Testing And Learning Go Hand In Hand
The MarketingSherpa study also found that most B2B marketers test various elements of their email campaigns. The catch is that relatively few of them are testing the right things: While the vast majority test elements like the subject line and message content, a much smaller group tests the use of landing pages or target audience choice – although the latter elements have a more significant impact on effectiveness.

"We found an opportunity for organizations to glean more knowledge from their own research by focusing more on a few strategic areas of the testing cycle," the report's authors concluded. "Only 15% of respondents said they routinely brainstormed new testing ideas, or took the time to define key metrics. Likewise, only 17% of marketers routinely reviewed the results and decided on follow-up tests." As a result, the report stated, many marketers are missing opportunities to identify the success factors in their email campaigns.