The State of Email Marketing Growth, Expenditure and Where to Advertise
| Category: E-mail Marketing | Date: 2003-10-23 |
According to IDC, Internet users are sending 5 billions of e-mail per day and 1.4 trillion e-mail messages per year. E-mail messages sent per day or per year will increase even faster in the next two years. IDC reports that by 2002, Internet users will send 14.9 billion e-mails per day and 4 trillion e-mails per year.
This unprecedented growth of e-mail use is causing businesses to salivate. They have reasons: it is easier and cheaper to start and implement a permission based e-mail campaign than to start and run a traditional direct mail campaign; the response rate of direct e-mail campaign is about 5 to 15 percent while traditional direct mail campaign produces only 2 percent response rate. According to Forrester Research, "10 percent of e-mail recipients click through to the senders Web page, and about 2.5 percent of those customers make a purchase during the visit."
According to Jupiter Communications, the E-mail marketing industry is expected to grow from $164 million (US$) in 1999 to $7.3 billion in 2005, and that 65 percent of companies are allocating 5 percent of their budget in direct e-mail and 22 percent of companies are already spending more than 5 percent. Emarketer, Inc. projects e-mail marketing to reach $1.994 billion by 2003. Forrester Research reports that by 2004, companies will spend $4.8 billion to send over 200 billion e-mail solicitations and $1.6 billion to solicit new customers.
The projected amount of money spent on email marketing differs from one source to another. All sources, however, show an upward trend. With the increasing budgets allocated for email marketing, companies are buying e-mail ads from different e-mail advertising media. Emarketer, Inc. reports that many companies are buying advertising spots on newsletters; they reach their target audiences by buying e-mail lists from service bureaus or list brokers like Netcreations, Inc. The proliferation of web-based e-mail provides advertising venues for companies to target e-mail users. Discussion oriented websites like eGroups and Topica create target communities that carry text based or banner ads on headers or footers of users e-mails. Auto responding or e-mail-on-demand sites like SendFree.com and Myreply.com also provide businesses with opportunities to target e-mail users. The aforementioned e-mail models are opt-in by nature. However, many businesses use unsolicited commercial e-mail (UCE) also known as spam to market their products and services.
While opt-in email is popular, spam remains e-mail no one wants to receive. Spam is a product of quick scheme operators who believe they can send millions of e-mail to make a quick sale in whatever they are selling. The bad news with spam is that it costs Internet Service Providers $1 billion annually to prevent and maintain e-mail servers plagued with unwanted commercial e-mail. While many Internet marketers still use spam, on July 18, 2000, the United States Congress overwhelming passed a bill that may someday make sending UCE unlawful.
Majority of Internet community abhor unsolicited commercial e-mail, but with the unprecedented growth of e-mail users, the killer app is becoming the tool of choice for communicating. The ubiquity of this Internet application will entice companies to spend billions of dollars to reach their target markets. Money that companies are already budgeting on e-mail marketing indicates that this form or marketing is becoming acceptable on the Internet. In response to this acceptance, online community builders and entrepreneurs are creating advertising media such as web-based e-mails, newsletters, mailing lists, e-mail discussion groups, and auto-responders for advertisers to target e-mail users.
© 2000 GroupWeb.com. All rights reserved
About the author.
Joseph Nchor
info@groupweb.com
http://www.groupweb.com
This unprecedented growth of e-mail use is causing businesses to salivate. They have reasons: it is easier and cheaper to start and implement a permission based e-mail campaign than to start and run a traditional direct mail campaign; the response rate of direct e-mail campaign is about 5 to 15 percent while traditional direct mail campaign produces only 2 percent response rate. According to Forrester Research, "10 percent of e-mail recipients click through to the senders Web page, and about 2.5 percent of those customers make a purchase during the visit."
According to Jupiter Communications, the E-mail marketing industry is expected to grow from $164 million (US$) in 1999 to $7.3 billion in 2005, and that 65 percent of companies are allocating 5 percent of their budget in direct e-mail and 22 percent of companies are already spending more than 5 percent. Emarketer, Inc. projects e-mail marketing to reach $1.994 billion by 2003. Forrester Research reports that by 2004, companies will spend $4.8 billion to send over 200 billion e-mail solicitations and $1.6 billion to solicit new customers.
The projected amount of money spent on email marketing differs from one source to another. All sources, however, show an upward trend. With the increasing budgets allocated for email marketing, companies are buying e-mail ads from different e-mail advertising media. Emarketer, Inc. reports that many companies are buying advertising spots on newsletters; they reach their target audiences by buying e-mail lists from service bureaus or list brokers like Netcreations, Inc. The proliferation of web-based e-mail provides advertising venues for companies to target e-mail users. Discussion oriented websites like eGroups and Topica create target communities that carry text based or banner ads on headers or footers of users e-mails. Auto responding or e-mail-on-demand sites like SendFree.com and Myreply.com also provide businesses with opportunities to target e-mail users. The aforementioned e-mail models are opt-in by nature. However, many businesses use unsolicited commercial e-mail (UCE) also known as spam to market their products and services.
While opt-in email is popular, spam remains e-mail no one wants to receive. Spam is a product of quick scheme operators who believe they can send millions of e-mail to make a quick sale in whatever they are selling. The bad news with spam is that it costs Internet Service Providers $1 billion annually to prevent and maintain e-mail servers plagued with unwanted commercial e-mail. While many Internet marketers still use spam, on July 18, 2000, the United States Congress overwhelming passed a bill that may someday make sending UCE unlawful.
Majority of Internet community abhor unsolicited commercial e-mail, but with the unprecedented growth of e-mail users, the killer app is becoming the tool of choice for communicating. The ubiquity of this Internet application will entice companies to spend billions of dollars to reach their target markets. Money that companies are already budgeting on e-mail marketing indicates that this form or marketing is becoming acceptable on the Internet. In response to this acceptance, online community builders and entrepreneurs are creating advertising media such as web-based e-mails, newsletters, mailing lists, e-mail discussion groups, and auto-responders for advertisers to target e-mail users.
© 2000 GroupWeb.com. All rights reserved
About the author.
Joseph Nchor
info@groupweb.com
http://www.groupweb.com
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