Email marketing that delivers a high ROI - a case study

Marketing ROI is all about getting more for your money. But is it possible to cut costs and get more sales?

Cut costs by more than 80%

One of my Chippenham email marketing clients used to post thousands of high quality printed newsletters to their customers and prospects every month. Taking into account design and print costs, postage and handling the typical cost was around £1 per newsletter. By switching to email they reduced their costs by more than 80%. 

As their volume grows, email offers a significantly lower marginal cost than conventional mail so the savings are even higher. At high volumes the cost per email is pennies.

Greater flexibility

With conventional mail, the same newsletter was sent to everyone. With email we send different content tailored to different audiences: currently 4 major versions but this is likely to grow over time with improved customer insight.

Improved customer insight

In addition to cutting costs, the email marketing provides much greater customer insight. With conventional mail, you have no idea whether the mail got to the intended recipient let alone read. 

With advanced email systems (such as the one I use for my clients), you get a wealth of data:-

• delivery data such as the number sent, the number delivered, hard & soft bounces which enable you to clean your database 
• opening data which is a useful indicator as to whether recipients read the email & if so, the number of times. Who the non-openers are is just as important and this insight can lead to changes to improve the open rate.
• action data such as the number of forwards to colleagues, unsubscribes, unique users click throughs

Identifying hot leads

My system also identifies hot leads which are people that have opened the email or clicked article links a specific number of times. This enable me to flag these hot leads to customers. 

e.g. Suppose an email was sent to 5,000 customers or prospects. Under the conventional post system, everyone would have to receive a follow up call to identify hot leads, which would be unnecessarily time consuming and costly, especially if the hot leads were all in the last 5% of telephone calls. It may be too late by the time you got to them!

With systems such as mine, data capture, identifies the hot leads that should be followed up immediately because they have read a specific article x times which implies a high level of interest. I can flag this insight to my clients within hours / days of the email being sent.

Greater insight = more sales

So, with greater customer insight, emails can be personalised and have tailored content to be more relevant for the target audience. Lower costs make it possible to have more frequent and timely communications. A greater focus on hot leads improves conversion rates and increase customer lifetime value. The wealth of data available should enable continuous improvements in email marketing to significantly improve customer lifetime value and Marketing ROI.

There is still a role for conventional mail but for most companies, most of the time, email marketing will cut costs significantly and improve sales.

Remember...web marketing is about solving customers' problems profitably.

Peter Hawtin is an internet marketing specialist with Brand New Way, a UK web marketing agency which helps companies to attract and retain valuable customers online.