How Do You Know Your Email is Working?

I recently wrote an article for the DMA's Infobox Email Newsletter in which I suggested that the current credit crunch would help move the email to the channel to the next level. Email really came into its own during the dotcom bust. The dotcoms were early adopters of the email channel but instead of email flaming out with the dotcoms, there was a huge library of case studies that sold the channel to the non-dotcoms.

I then went on to state that this credit crunch will force marketers to better segment their lists because finance directors are going to expect increasingly higher return on investment. In addition, marketers are realising that as email address penetration tops out they are all competing for the same static number of readers. This will result in an increase in the cost of acquisition for opt-ins, so it is important that marketers keep as many of their readers engaged as possible. Better targeting equates to increased relevance which leads to increased engagement.

So today I read an eMarketer article about a MarketingSherpa survey. Not surprisingly, email marketers that think email is becoming more effective will spend more money on it and email marketers that think email is becoming less effective try to keep email as close to free as possible.

The part that bothered me was the group that responded with "e-mail is cheap and still working-why invest more?" Didn't these people read my article? Maybe it didn't get much take-up in the US.

Actually, I think it is down to how these marketers are measuring their email programs. By focusing only on the process metrics of delivery, open, and click rates it is hard to see when large segment of your population becomes disengaged with your email program. By looking however, at the performance metrics like engagement, sales, return on investment, you get a much better picture of whether your email program is working. I have yet to find a client that is in the business of generating clicks. Every client I have ever worked with, was in the business of generating sales. That should be the only indicator of whether an email program is working.