Last week, Austin Bliss and Stephanie Miller wrote about the value of an email address and the success metrics around that value. Analysis of their survey enabled us to see the results. This week, as Chad White, the Email Experience Council's Director of Retail Insights and Editor-at-Large releases his latest report that follows three companies' efforts in "refer-a-friend" programs, we have the opportunity to look into the question of justifying email analytics. In the world of email, does an analytics program or project cost justify itself, and if so, why?
For many businesses, regardless of the size, deciding whether to invest in analysis can be a major issue. Campaign testing and analysis comes at a price. Whether that is time, resources, and/or budget, the decision is perplexing to many marketers. Their question: Will the results of my analysis provide enough insight that the potential increase in ROI outweighs the cost of the analysis?
No one will argue that analyzing every level of your campaign is a bad idea. But when a business is seeing acceptable results from campaigns that generate positive ROI, presenting the need for an in-depth campaign review poses a challenge and puts ESPs and agencies in the hot seat. Fees associated with analysis are expected to be less than the revenue generated from the analysis results. When budgets are tight, analysis becomes even more essential for achieving the desired results, yet it is often one of the first items to be cut from a project.
So when is it a good decision to invest in analysis -- and when should you be content with your results? Should you ever be content with your results? What is the price of knowledge? These are difficult questions to answer. Assume you spend X amount of money to run subject line testing, and you learn that both subject lines deliver equal results. Is that money well spent?
When considering these situations, several factors may help in reaching a decision on whether or not to invest in analysis:
Consider ROI. If you believe the analysis will provide enough insight to positively impact the overall return on investment, then make it a priority.
Consider long-term value. Too many marketers look at results by campaign. A 1% increase in open rates may not justify subject line testing for one campaign, but when that learning is extended over several years and takes list growth into account, the value becomes more evident.
Consider the online impact. Can email marketing analysis provide learning that extends to a Web site, landing pages or search engine marketing?
Consider the offline impact. Many marketers forget that what they learn in their email marketing can be used to their advantage in traditional advertising, in-store materials, direct mail, catalogues, etc.
When looking at the big picture, it's easy to see how analysis can greatly improve not only email marketing results, but also nearly all aspects of business marketing and advertising. Analytics services are offered by large advertising agencies, some ESPs and smaller boutique shops. If you are interested in pursuing an analysis of your latest email marketing efforts, I recommend starting with the basic questions, and then asking those who have conducted programs in the past about their experiences to help select your first analytic pilot. Good luck!