Email Marketing Still Works, Study Finds

by Paul Gough, Aug 25, 2003, 12:00 AM

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Consumers aren't so exhausted by spam that they don't want to hear from - and respond to - emails from legitimate marketers.

That's the message behind a DoubleClick study that tracks trends in permission-based email marketing among the company's 300 or so clients. The study, released Monday, finds a better climate in several industry metrics in the second quarter compared to the same period a year ago.

Click-through rates increased more than 10%, from 7.5% to 8.3%. Click-through rates track the number of consumers who "click through" an email marketing piece to an associated Web site. The report said consumers clicked an average of 1.6 times per email.

Other metrics were also higher year over year. Open rates rose from 37.6% in the second quarter last year to 38.8% this year. And the messages that don't get through ton consumers - measured in the industry as bounce rates - fell 2.4%, from 13.6% in the second quarter 2002 to second quarter 2003.

Eric Kirby, vice president of strategic services at DoubleClick, said Monday afternoon that email marketing's overall performance had been stable despite a poor economy and an onslaught of spam that has clogged Internet users' mailboxes.

"The end-recipient customer of the email recognizes and differentiates those permission-based relationship [emails] from spam," Kirby said.

Conversion rates, which measures the ability of email to generate sales, have also been steady. The average revenue generated by each email was 28 cents in the second quarter, compared to 29 cents a year ago. More than 2.65 purchases occurred per 1,000 emails sent, with the average order size falling slightly from $102 in 2002 to $98 in 2003.

"These numbers really show stability in performance," Kirby said. " a couple of dollars movement is not really anything to draw a major conclusion. There's been an incredibly stable performance in revenue."

DoubleClick said retail and catalog emails had delivery rates of 91.3% (up 6.9%), open rates of 37% (up 14.9%) and click-through rates of 6.7% (compared to 6.1% a year ago). Travel emails performed better although emails from business publishers and other business-to-business applications fell.

Kirby said it was clear that, despite spam, permission-based email marketing worked well. "I think you'll see more dollars moving toward email marketing as it has been proven to be an effective marketing channel," he said.

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