There are currently over 4 billion global email users and this is expected to exponentiate over the next couple of years. With such an immense growth potential in emailing, advertisers have and are continuing to send ad campaigns to users through this process. Although a very aged advertising method, email marketing is constantly adapting to technology disruptions and remains one of the most effective communication channels.
Digital Marketing Milestones
The first mass email campaign occurred in 1978 where an employee of Digital Equipment Corporation sent a form of digital marketing to 400 recipients. The company gained an expected $13 million from this strategy, which caused this kind of digital advertising to accelerate. Another milestone was hit a couple of decades after when Hotmail was launched as a web-based email service. This platform has allowed advertisers to take complete advantage of the ability to personally reach customers and market their products in a cost-effective manner. With this large focus on email marketing, regulations were enforced to prevent spam and overload of emails by various organizations. One including the Data Protection Act in 1998 to ensure there was an ‘opt-out’ option for customers in the case they were not interested. As digitalization has grown and stemmed into a significant number of sectors, advertising has been evolving. Even with phones and social media being invented, alongside ads being placed on 3rd party apps through personalized data, email marketing never became irrelevant. This is due to factors that are likely to drive it forward in the future as well- digital innovation, customer loyalty and click through rates.
The Evolution of Digital Marketing
As email services have evolved and kept up with the latest technology advancements, email marketing has progressed. An example includes the release of hyperlinks and visual formats (gifs, videos, images, and more) on email, resulting in the use of these tools to not only personalize products to viewers but also capture their attention in their inbox. Directing them to visuals or leading them to another link for further information allows for minimal information placement and fewer distractions. There are no pop-up ads on other forms of digital marketing which result in a loss of focus on what is being read.
Building from a point mentioned previously, in email marketing, there is no interference in the content that the viewer is reading. Furthermore, these emails can be personalized in the form of newsletter marketing. A newsletter is a tool that is used to deliver information on a certain topic to interested customers. By targeting a certain audience group based on the content of the newsletter, companies can hold a stronger influence. With these campaigns being strategically placed and chosen for certain relevant newsletters, their products are likely to get greater attention and activity. By making the right customers aware of their product, customer loyalty is built more easily and through a relatively more personal touch compared to an ad being shown on a website or social media app.
According to MailChimp, email marketing contains an average of 20-25% open rate and a 3% click-through rate. In absolute terms, these percentages are deemed minimal, however, social media platforms such as Facebook have a click-through rate of only 0.90%. Additionally, the extremely significant customer base in emails means a large number of people will be engaged in this form of advertising. Although set in June 2016, a study by eMarketer showed a medium ROI of 122% through email marketing which was clearly above any other digital advertising form. In addition, newsletters were the most common type of email marketing back then and currently still is.
A likely catalyst that will turn the attention towards email marketing includes the recent iOS privacy policy update. By allowing users to opt-out of in-app data collection from 3rd party apps such as Facebook, personalized ads will be limited. This has a chain reaction of reducing social media digital marketing, decreasing profitability from social media platforms and sales from advertisers. According to Facebook, small business advertisers on average are expected to experience over a 60% cut in their sales for every dollar spent. This will be due to the inaccuracy of the ads presented to specific users given the lack of data about them. This drastic impact will result in advertisers looking for other forms of advertising to maintain or increase their sales over time. Email marketing is expected not to be affected by this change since the personalization of ads can still be carried through with no prior in-app data. Therefore, this change can definitely cause a transformation towards email and newsletter advertising.
PostApex and Newsletter Advertising
A company worth mentioning is PostApex, the market leader of email newsletter marketing. Their marketplace facilitates the purchase and sale of adverts in email newsletters, reaching thousands of site visitors every month. With over 400 newsletters on their site, advertisers are able to reach personalized audience groups in a variety of industries. As mentioned earlier, the industry average of 20-25% for open rate and 3% for click-through rate. PostApex has an average of 52% open rate and 14% click-through rate signifying a great selection of newsletters that advertisers can take advantage of. Featured in Business Insider and Builtin, this ad-tech startup has strong potential to grow as email marketing expands. The platform is constantly being updated to improve existing features and adding new ones for newsletters and advertisers to enjoy.
The Future is still Digital
Given the wave of digitalization and constant technology innovation, email advertising is likely to adapt in real-time. With machine learning and artificial intelligence, advertisers could have the freedom to send mass emails where each one of them are automatically personalized through AI, given the user’s digital footprint. Furthermore, graphics could be created by the software itself and be targeted at specific users. In summary, advertising and marketing agencies will change their focus from trying to create personalized content to training their algorithms with large amounts of data to be able to achieve the situations explained above.
In terms of newsletter marketing, a subset of email marketing, advertisers would be able to scan through a large number of newsletter names and automatically pick the relevant ones for the firm. Creative graphics for ad campaigns could be created by technology as well and make the process overall much more efficient. Building on these ideas, personalization could be taken to the next level in terms of increasing interaction within the email. For example, being able to visualize the product or service in 3D and have the option to buy it in the email itself, demonstrating a customer-centric mindset.
Overall, email marketing has come a long way since the late 1970s. As technology advanced, the concept was able to adapt and build on its success. Especially with recent news, given Apple’s new privacy policy, email marketing is once again being directed to the spotlight for advertisers. Along with this acceleration in popularity, there are startups entering the market to provide a platform for advertisers and newsletters to connect. Leveraging the success of newsletter marketing, firms such as PostApex are leading this syndicate. In terms of what is to come for the future, it is difficult to predict how digital advertising will be 10 or more years later, however, the possibilities are endless and exciting!
