Email, although a conventional mode of marketing and communication, has weathered the storms of Twitter, Facebook, Slack, Mobile, and even RSS. What has helped email become a valuable medium over time is its periodic evolution. From plain-text messages to highly targeted and automated emails, they have now mastered features like HTML and CSS coded design, interactivity, videos, and even live feeds. No wonder, the number of global e-mail users is set to grow to 4.4 billion in 2023. Moreover, according to Adestra, 68% of teens and 73% of millennials consider email as the preferred communication medium.
From the marketer’s point of view, the meat lies in the fact that the email marketing return on investment is stellar; it boasts of returning $38 for every dollar invested, according to Litmus research. On average, a mid-sized business would spend $9 to $1000 monthly on their email marketing needs if they self-manage their campaigns or $300-$500 monthly if they choose an agency.
That said, how much should one invest in email marketing? What are the factors that determine the amount you will be spending on email marketing? Let’s nail them down:
How accurate is your email list?
Your list must be organically grown and comprise of subscribers who have opted-in for your emails. Inactive subscribers on your list can ebb the results of your email campaigns. One needs to make sure to clean it up at regular intervals in order to get the best ROI from your email campaigns. There are tools available that can be used to identify invalid email addresses and inactive subscribers. You should consider investing in such tools.
How far would you go with your email design?
While choosing a template, one must first define the goal of the email. Will a reusable, pre-existing email template do the job or should you rather invest in a custom, one-off design? Intricately designed emails or those that feature interactivity require you to shell out more money. Also, you need to ensure the template is responsive and renders across all devices. Most agencies charge either a flat or hourly rate to design custom email templates, also helping you integrate the designs in your email service provider.
Are you investing in campaign performance reporting and analytics?
Analyzing the results of your email campaigns is a must, as it helps you know how well or how not-so-well your campaigns are performing. The volume of email, open rates, click-through rate, conversion rate need to be tested along with A/B testing of subject lines, pre-header, email design elements, copy, and calls to action with tools that can go a long way in helping you maximize your results by giving you information on the performance of your emails and helping you adjust it accordingly.
How would you choose the best email service provider?
An email service provider (ESP) helps you send emails that are targeted to your customer niche, ensures delivery, and provides actionable results. Most deliverability problems are associated with email lists, but the right ESP can help you solve many of these problems by providing you with a well-monitored IP address list. The email platform you choose plays a major role in determining the amount of money you spend on email marketing. You’ll need to focus on your requirements and research the available options to make the best choice. It is recommended that you choose an ESP that allows you to execute an email sunsetting strategy and removes the subscribers that have been dormant over a long period of time.
Why an email marketing manager or agency are vital?
Managing an email campaign can be a daunting task. Email marketing agencies assure expert handling of your email marketing program. An in-house manager can also handle your email marketing. You need to check out the cost factors for both before choosing one. Keeping a budget for professional handling of email marketing can go a long way for your business. Most agencies charge a monthly fee for their services with a specific volume of emails to be sent every month.
Summing it up with a ‘Budget Building Checklist’
- Allocate 16% of the total marketing budget to email marketing and build it based on the list of those subscribers who have opted-in in the past two years.
- Choose between reusable and one-off email templates based on your needs and invest accordingly.
- Use testing tools to measure the performance of your email campaigns. Since it helps to figure out the gaps, it also helps gain the best ROI.
- Jot down your requirements to figure out the best ESP option for you.
- Your level of experience and familiarity with email marketing tools and technology might not be enough. Opt for professional handling through an agency or an in-house manager.