Commentary

Email Marketing Budgets Up, Ad Budgets Down

According to the June "2009 Marketing Trends Survey" by StrongMail Systems, even in the midst of the current recession, 42% of nearly 1,000 global business leaders polled plan to increase marketing budgets in 2009, and an additional 43% plan to maintain current levels.

Programs Planned For Increased Spending in 2009 (% of respondents)

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Program

Intend to Increase Spending

Email marketing

81%

Social media

58

Search

52

Advertising

36

Public relations

28

Trade shows

13

Other

12

Source: StrongMail, July 2009

Only 15% of polled businesses expect to see a decrease in customer sales in the second half of the year, which is a dramatic improvement over the 37% who responded similarly in StrongMail's December 2008 survey.

Sales Expectations in Second Half of 2009 (% of Respondents)

Expectation

% Sharing Attitude

Expect customers to spend more

34%

Expect customers to spend about the same in 2nd half

31

Not sure

18

Expect customers to spend less

15

Source: StrongMail, July 2009

According to the report, businesses currently project that 34% of customers will spend more in the second half of 2009, versus only 19% in the December survey, while an additional 31% project that customers will spend the same.

Planned investment in email marketing has also increased, with 81% of businesses planning to increase budgets targeting this channel, versus 73% in December 2008. Additionally, social media has emerged as a significant focus for increased investment, as reported by 58% of businesses.

Advertising and tradeshows were again singled out as the top targets for budget cuts:

  • 78% of businesses decreasing budgets are targeting advertising
  • 58% are also looking at tradeshows

This represents a steep increase from the December survey results of 29% and 19% respectively.

The report says that increasing email relevancy and personalization remain top priorities for the latter half of 2009 for 77% of the businesses polled. The top three email marketing initiatives identified for the latter half of the year reflect a desire to improve relevancy, with 66% of respondents looking to increase the performance of their campaigns, and 52% looking to improve segmentation and targeting. Growing their opt-in list attracted the third highest response at 45%.

Most Important email Marketing Initiatives in 2009 (% of Respondents Checking)

Initiative

% Reporting Important

Improving email performance

66%

Improve segmentation and targeting

52

Growing opt-in email list

45

Integrating social media and email marketing

34

Re-engaging inactive subscribers

31

Improving deliverability

28

Integrating marketing into transactional emails

22

Accessing data from other systems to increase relevance

21

Centralizing email onto one platform

15

Source: StrongMail, July 2009

Survey Highlights

  • 85% of businesses plan to increase or maintain marketing spend in the second half of 2009
  • 34% of businesses expect customers to spend more; 31% to spend more
  • 15% to spend less
  • 81% of companies increasing budgets are doing so in email; 58% in social media
  • 78% of businesses decreasing budgets are cutting advertising; 58% in tradeshows
  • 77% of businesses plan to increase email relevancy

Bill Wagner, executive vice president of business operations at StrongMail Systems, concludes "The fact that planned investments in email marketing have actually increased in the past six months, at the expense of more traditional marketing channels, speaks to email's status as the most economical and effective tool in a direct marketer's tool box..."

For more from StrongMail, please go here.

 

2 comments about "Email Marketing Budgets Up, Ad Budgets Down".
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  1. Trevor Stafford from Red Canary, July 28, 2009 at 9:11 a.m.

    Please start linking your email logo/header to the article in question. I hate having to scroll down to a lonely link just so I can share your content on Twitter.

  2. Howie Goldfarb from Blue Star Strategic Marketing, July 28, 2009 at 12:26 p.m.

    Email has many benefits. Email also has many significant problems. Specifically clutter. I receive a ton of emails from brands, stores, political orgs, and news sites. All of them I have opted in for. Yet I open less than 1% is my guess because there are just too many.

    My sister works for a non-profit that uses email. She said her 'open' rate is about the same as my open rate.

    So is this a wise way to go? Unless the subject line says FREE or a significant catch phrase I do not have time to open. I opened today a $49 offer from Virgin Air. Yesterday I opened one from Groupon because it was for a restaurant. Today's was for a beauty product so I left it closed.

    Traditional Marketers can go to the CFO and claim how many people they send the email too to look impressive and the CFO might never ask what is the open rate. But they should.

    Money should be allocated to those media channels that have the greatest measurable R.O.I. and not the ones with the lowest cost.

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