Email marketing budgets and ROI increase amid the pandemic

According to the latest ‘Marketer Email Tracker 2021’ report, created by the Data & Marketing Association (DMA) in partnership with Validity, the average proportion of marketing budgets spent on email has passed the 20% mark for the first-time (21.3%).

Just under half of businesses now spend over 20% of their marketing budget on email (45%), the highest proportion on record since the DMA started the annual email tracking series in 2015.

This year, marketers estimate email’s return on investment (ROI) to be £38.33 for every £1 spent – a figure that has risen steadily from £29.64 in 2016.

Email is also the most used channel by brands to engage with consumers across the customer journey (72% of marketers stated this), followed by social media (66%) and online ads (59%).

“The various restrictions in place throughout the year appear to have benefitted email, not least that budgets appear to have been directed (or re-directed) to email while other channels were not available. Despite pandemic conditions, most marketers report positive trends for various key email performance metrics too,” said Tim Bond, Head of Insight at the DMA. “Overall, the latest figures continue to paint a positive picture for email, proving its value to businesses during a year where virtual communication has been essential for brand survival. It remains the most relied upon channel for nearly two-thirds of brands across the customer journey, while delivering a return on investment that has continued to increase as well.”

Marketing objectives shift, creating fresh challenges

The focus on sales as an objective for email marketing fell from 31% a year ago to just 24% this year. Meanwhile, those primarily using email campaigns for customer service has risen from 9% to 13% year-on-year.

The challenges marketers face have seen notable shifts too. Concerns around the lack of data, access to it, or its quality (stated by 52%) have significantly increased year-on-year (up 10% from 2020’s report). Even overtaking budget/resources for the first time (52%) – albeit by less than 1%. The percentage of marketers citing issues around marketing technology also rose to 38% this year, up 14% from last year’s figure.

Guy Hanson, Deputy Chair of DMA Email Council & Vice President of Customer Engagement, Validity International, added: “It’s good to see email marketing budgets continuing to increase, but concerning that marketers are struggling more than ever with data and technology challenges. High quality data – that is accurate, up to date, and aligned with the purpose for which it was collected – means companies can create relevant messaging that builds stronger relationships and delivers increased value. Therefore, it is essential for businesses to not neglect investment in this precious resource, as well as the talent and technology that utilise it.”

What are the most significant challenges to successfully executing your email marketing programmes?

To read more about the DMA’s new research, visit the DMA website: https://dma.org.uk/research/Marketer-Email-Tracker-2021

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