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Email Marketing ROI and Data Quality Go Hand in Hand

March 22, 2013
By Michael Neubarth

email marketing ROI hand in handEmail marketing consistently generates the highest return on investment (ROI) among all online marketing channels. However, studies show that 30% to 50% of companies do not, or cannot, determine their email marketing return on investment (ROI).

New survey data from the Direct Marketing Association (DMA) shows that more than one-third (34%) of businesses are unable to calculate the revenue earned from email marketing. As David Moth of Econsultancy reports, this jibes with data from the new Econsultancy/Responsys Marketing Budgets 2013 Report, which found that only 52% of businesses rate their ability to measure ROI from email marketing as ”good.”

As Moth notes, a key indicator of the value of email marketing is its share of business revenue, with a majority of businesses (62%) producing more than one-third of their digital business revenue through email, and another one-third (34%) generating 50% or more of their digital revenue from email marketing.

With email marketing such a key revenue generator, and with ROI so closely tied to performance (how many prospects reached, engaged and converted), it is important to ensure your email marketing operation is performing at its optimum level.

Why Can Email Campaigns Underperform?

Email campaigns can underperform for a number of reasons—including too many bad addresses or inactive subscribers, content that misses the mark on relevance, missing data that prevents targeting and segmenting, and failure to take advantage of tactics such as triggered email, mobile marketing, social media integration, big data mining and cross-channel marketing.

If your data is poor or degraded, you risk undermining your deliverability and reputation, which ultimately will impact your marketing success and bottom line. And indeed, Return Path surveys show that sender reputation was the cause of 77% of email delivery problems.

Excellent Data Hygiene and Data Appending Can Help

This is why, as SilverPop relates, the success of top email marketing performers is most likely due to their being “more vigilant about verifying email addresses before adding them to the database and about doing list hygiene to remove undeliverable addresses.”

Likewise, Aberdeen Group reports that solving problems associated with “inconsistent or inadequate” customer data is crucial to online marketing success.

The importance of data hygiene and appending have risen along with the use of triggered email. As Epsilon’s latest Email Trends and Benchmarks study shows, the use of triggered messaging is up 73% year over year, with triggered messages yielding 70.5% higher open rates and 101.8% higher click rates compared to Business As Usual (BAU) messages.

However, if you are targeting the wrong prospects and your messaging is off the mark, your results will suffer. Again, data appending can help solve these problems by supplying the missing data to profile and target more effectively.

As Heather Fletcher informs us on targetmarketingmag.com, “Bad prospect data may be costing companies millions. At the same time, consumers are concerned about maintaining their privacy. The solution, according to representatives of Epsilon Targeting and Marketfish is respectful, effective data appending.”

TowerData's real-time data services can catch and correct bad contact information as it's entered as well as append addresses and demographics. Click here for your free trial of data appending.

Photo Credit: deVos

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