Email Marketing and Subscriptions – Do We Still Need Them?

Email Marketing and Subscriptions – Do We Still Need Them?

Is email marketing dead? Marketer Lynn Serafinn looks at stats, shares her own experience, and asks YOU to contribute your own opinions for her upcoming book.

Leads Generation. Opt-ins. Subscribers. Mailing Lists.

These were the buzz words in marketing when I was building the online platform for my company back in 2007. The whole idea of Internet marketing was (or so the gurus said) to get people onto your mailing list so you could market to them on a regular basis via email. Innumerable training courses have been delivered over the years on how to increase opt-ins and how to develop ‘auto-responder’ programmes that ‘drip-feed’ email messages to your audience as frequently as once a day (and that’s not including the weekly newsletter).

Many people using the Internet as a marketing platform still follow this same marketing model. But these days, I’m starting to wonder…

  • Is email marketing really necessary?
  • Did it EVER really work as well as we’d been led to believe in the ‘old days’?
  • And, even if it was effective back then, is it still a relevant marketing model today?

To address these questions, I’m going to examine some statistics that can help give us a better idea of the effectiveness of email marketing in today’s environment, and share some observations I’ve made in my own online marketing (which focuses primarily on blogging).

But I don’t want this to be a one-way exploration. I’d like this article to generate a rich dialogue between us (and hopefully result in some useful market research for my upcoming book). So, at the end of this post, I’ll be asking you some questions, which I hope you will take a few minutes to answer, so we can all can get a deeper insight into our true feelings about email marketing and subscriptions – beyond raw ‘statistics’ and the status quo.

A Look at Email Marketing Statistics from 2012 and 2013

Over the years, many studies have been made of the effectiveness of email marketing. The three key statistics these studies examine are:

  • ‘Open rate’, which is the percentage of people who actually OPEN your email compared to the total size of your mailing list
  • ‘Click-through rate’, which is the percentage of people who click the promotional links within your newsletter/email shot
  • ‘Unsubscribe rate’, which is the percentage of people who unsubscribe from your list after you have sent them an email
  • ‘Bounce rate’, which is the percentage of emails you send out that are undeliverable due to dead email accounts, incorrectly spelled email addresses, people having full inboxes, etc.

I won’t be talking about ‘bounce rate’ in this article, but we will take a look at the first three of these parameters.

In an article published in May 2013, UK marketer Dave Chaffey compiled statistics from several different sources on the ‘Smart Insights’ blog. One set of stats, taken from the ‘Signup.to’ website, reported these averages across all industries for UK SME email marketing campaigns:

  • Open rate = 21.47%
  • Click-through rate = 3.16%
  • Unsubscribe rate = 0.47%

I’m assuming (although I might be wrong) that when Signup.to says ‘UK SME email marketing campaigns’, they are referring to companies based in the UK. However, what this does NOT tell us is where their subscribers live. For example, the 7 Graces Project CIC is a UK-based non-profit SME, but nearly 70% of our subscribers and followers are based in the US. My question about these statistics would be: How do these averages reflect companies with a national (or even local) subscriber base versus an international one?

Another source Chaffey cited was a report from the Epsilon Email Marketing Research Center, which showed that the average open rate in the US in 2012 was 26.6%, with an average click-through rate of 4.5%. Again, I’m not entirely sure if this refers to companies based in the US or that subscribers are based in the US. Either way, the figures would suggest that the US is slightly more predisposed to email marketing than the UK (other stats from Epsilon show that continental European countries are more similar to the UK than to the US in this regard).

Similar statistics are also available from most email delivery services. I recently spoke with a representative at my own email delivery provider, GetResponse, and they told me that for their customers in 2012, the average open rate in the US was 19%, with an average click-through rate of about 4%. They were clear that by ‘open rate in the US’, they mean subscribers (not businesses) who live in the United States. At least that’s unambiguous.

MailChimp, another popular email delivery service, published a report called ‘Average Email Campaign Stats of MailChimp Customers by Industry’. These statistics are way off the scale compared to the others already cited, with open rates ranging from a low similar to GetResponse (19%) to a massive 48%, depending upon which industry they are polling. While this might seem to skew them (and make the MailChimp email service look ‘better’ than others) the statistics are somewhat misleading, as we have no indication of how many companies are represented within each sample group (and without a large sample group, statistics are pretty meaningless). Nor do we know anything about the size or age of these lists. The reason I bring this up is because nearly all the clients I have had who used MailChimp for their email marketing were 1-person companies with relatively new businesses and small mailing lists (often just a few hundred). Most of the more established clients tended to use other providers (like AWeber, GetResponse, 1ShoppingCart or InfusionSoft). This has an impact on the statistics because it is far easier to get a high open rate from a list of 100 people who have recently joined your list than if you have 100,000 people on a list that has been slowly growing for many years. So again, without being able to see these statistics in context, they are not terribly helpful.

Newsletters: Effective Marketing or a Waste of Energy?

Helpful or not, let’s try to put some of these statistics into plain English with real numbers. For the sake of this exercise, I’m going to use a conservative average of the figures from GetResponse and Signup.to. To make it easy, let’s say our average open rate = 20%, our click-through rate = 4%, and our unsubscribe rate = 0.5%.

Let’s say you have an email list of 10,000 people. The statistics say that an average of 2,000 people on your list will actually open each email you send out. If you have a link to some kind of special offer in the email, about 400 of them will click the link to check it out. That doesn’t mean they’ll BUY your product, mind you. Actual sales are virtually impossible to predict (and don’t let anyone tell you otherwise). Many internet marketers maintain the ‘myth’ of the 2-3% sales conversion rate after clicks (which would mean that you would make about 8-12 sales from your list of 10,000, or 0.12% of your total list) but even at a generous 10% (40 sales) your overall ‘conversion’ rate compared to your entire mailing list is still just 0.4%.

And, of course, if you have only 1,000 people on your mailing list, you will have the same averages, but these absolute figures will be one-tenth of these, i.e. 200 opens, 40 clicks and (possibly) 1-4 sales.

From these figures, it would seem that sales made through email marketing are pretty puny (unless you’re selling very expensive products). But, like all statistics, without context, these figures are completely arbitrary. The reality is that the number of sales you will actually make is dependent upon many variables that have nothing whatsoever to do with email, such as your relationship with your audience, your professional status within your industry, the relevance and timeliness of your offer, your price-point and so on.

Of course, if you’re someone like me who offers professional services, you don’t send emails to generate ‘click-throughs’ so much as to educate and connect with your subscribers, so that you remain at the forefront of their minds and they will remember to call you when they need someone in your field. In such a case, it’s much harder to evaluate whether or not your newsletters are generating business for you UNLESS you ask your new clients what (or who) inspired them to contact you (sometimes they don’t even remember).

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So far we’ve looked at open rates and click-throughs. But now get ready for the real shocker – unsubscribes:

  • If the unsubscribe rate of 0.5% is correct, it would mean that, with a list of 10,000 subscribers, about 50 (yes, 50!) people will UNSUBSCRIBE every time you send out a newsletter.
  • What makes this so shocking is the fact that – IF the statistics are right – the average mailing list is LOSING subscribers faster than it is making new customers!
  • It also means that, regardless of your list size, unless you are actively doing something to grow your list by at least 1% during the period between newsletters, you’re doing more harm than good by sending them out regularly.

Long story short: the more emails you send out to your list, the harder you have to work on growing your list.

To me, it sort of feels like the logic people use when they say they need a car so they can drive to work, but then say they need the job to make the car payments. I can but scratch my head in bewilderment.

Too Many Emails: Creating Warm Leads versus Leaving People Cold

Possibly the MOST important piece of information we can glean from the statistics is the reason most people give for unsubscribing. Of the many options they could choose when unsubscribing, the most frequent answer is:

‘I receive too many emails in general.’

The ‘old school’ of Internet marketing preached that we needed to communicate with our ‘leads’ frequently so they would stay ‘warm’. I do agree that if we seem to disappear off the face of the earth for an extended period of time, people will be likely to forget who we are and what we do. But even so, I believe the marketing love-affair with auto-responder campaigns – where our subscribers get a series of pre-fab emails every day for weeks on end – is well and truly kaput. We are all suffering from information overload. These days, if I subscribe to a list and I get bombarded daily with emails, I simply won’t tolerate it, and I unsubscribe within the first three days. This is partially because those types of emails tend to be full of hype rather than useful information. But it is also because – like the majority – ‘I receive too many emails in general.’

My inbox runneth over!

I’ve also come to look upon the old-school auto-responder method as a betrayal of trust. When I surrender my email address to someone, I’m taking it on their honour that they won’t exploit this privilege (and it IS a privilege). But if they bombard me with constant email communications, far from keeping me ‘warm’, it leaves me stone-cold and wanting to get rid of them. In the 7 Graces model, this kind of email over-kill is an example of the ‘Deadly Sin of Invasion’.

The 7 Graces of Marketing model embraces a ‘do unto others’ attitude. I don’t use these kinds of email campaigns at all. If I don’t like it being done to me, why would I do it to my valued subscribers who were kind enough to give me their email address? I used to wonder if I was crazy not to follow the pack, but now I’m certain it’s the right thing to do.

As I see it, instead of ‘invading’ our audience, our aim should be to ‘invite’ them into our space. That’s why the Grace of Invitation is one of the 7 Graces (number 3, to be precise).

Levels of Commitment – A Different Way to See Our Audience

To show what I mean by the Grace of Invitation, it’s useful to look at the traditional idea of the ‘marketing funnel’, but with a slightly different twist. In the 7 Graces paradigm, we use the marketing funnel to illustrate 7 different levels of commitment people feel towards us/our business. Each of these levels of commitment should inform us about how we can best communicate with our audience at each stage:

7 Graces Marketing Funnel

At the top of the funnel is the ‘social media cloud’, i.e. our friends and followers on social networks like Twitter, Facebook, etc. People in our cloud do not necessarily have any real ‘commitment’ to our business. They might not ever know very much about us at all.

The next layer is your (casual) blog visitor. I often say that there are two primary purposes of social media: 1) to build relationships and 2) to drive traffic to your blog. How you drive traffic to your blog is a matter of getting your audience right, creating content that speaks to their interests and needs, and broadcasting social media ‘bytes’ that pique their interest on a consistent basis. It’s a system, but not rocket science. But just because people have made it to your blog (and bearing in mind that many will come from search engines), does NOT mean their relationship with you is any deeper than those in your social media cloud. At this point, it’s important to note that, in contrast to the ‘old school’ practice of asking people to ‘opt in’ to your newsletter before they see your content, your blog posts are an opportunity to DEVELOP that relationship before they commit to anything at all.

This one factor makes blogging an entirely different form of marketing from mailing lists. While opt-ins and mailing lists are based upon the idea of ‘If you commit to me, I’ll give you something for free’ (which, of course, isn’t really free because I asked for your email address first), blogs are based upon the idea of ‘I’ll give you something for nothing, and you can love me and leave me if you want.’

One is a barter. The other is a gift. In ‘7 Graces’ lingo, the first is the ‘Deadly Sin of Persuasion’ and the other is the ‘Grace of Inspiration’.

You’ll notice that I’ve labelled the next layer ‘Loyal Reader / Blog Subscriber’. Of course, people can and will subscribe to your blog if they enjoy your content. But what if they come to your blog regularly, but choose not to subscribe? In this era of ‘I’ve got too many emails in general’, where so many of us are all connected to each other on multiple social networks anyway, is there really any difference – from the perspective of levels of commitmentbetween someone who subscribes to your blog and someone who drops in to read your latest article whenever they see you Tweet about it or post an update about it on Facebook? This is why I’ve placed these two types of connections at the same level.

Loyal Readers versus eMail List Subscribers

Now I’d like to put some of these ideas into actual context. Rather than discuss dry statistical averages that talk about everyone and no-one at the same time, I’m going to be really transparent (Transparency is Grace #6) and share our 7 Graces statistics with you.

We have a mailing list of roughly 8,000 people on GetResponse, which I have been gathering over the years. My business direction has changed many times, so some people on this list have gone as new people have come in. We (try to) send out a newsletter every 2 to 3 weeks. Our typical open rate tends to be between 20-25%. Each newsletter has 3 articles. That means that, even in the best case scenario, about 2,000 people read around 6 of our articles every month. And just because they OPEN the newsletter does NOT mean they read all (or any!) of the articles.

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If people are away on holiday, the newsletters will hit a ‘soft bounce’ because their inboxes are full and cannot accept any more email. If the system is unsuccessful too many times when it attempts to redeliver the newsletter, it will REMOVE their email from our mailing list altogether. On top of that, there will always be some people who will unsubscribe, as we’ve seen in the statistics above. Fortunately, we have a pretty low unsubscribe rate of 0.25% but that’s still roughly 20 people every time we send out a newsletter. If we aren’t pro-active about replacing the numbers lost from unsubscribes and bounces, our numbers go down.

On the other hand (according to AWSTATS, which is what we use to monitor our blog traffic) the 7 Graces blog is currently read by about 3,200 people who read between 10,000 and 12,000 pages on this site every day. At the rate our visitors are regularly increasing, we can predict that within the next 6 weeks, this site will surpass 100,000 visitors per month (20,000+ unique visitors), who will read about 500,000 pages. As long as we keep posting and Tweeting, etc., our numbers NEVER decrease.

You might ask, ‘With almost 20,000 unique visitors a month, how many actual SUBSCRIBERS does this site have?’ You might be surprised to know that it’s only a few hundred. What I’ve learned is that ‘loyal readers’ don’t necessarily feel the need to subscribe if they feel confident they’ll see your updates on Twitter or Facebook, etc. Why do they need to clutter up their inbox with more ‘stuff’ when they know where to find you?

What a stark comparison this is compared to our mailing list. With a handful of ‘subscribers’ we reach more people in a single day on this site than we do in an entire month through our 8,000 member email list. Furthermore, the blog growth is quite organic and ongoing, whereas mailing list growth nearly always involves some sort of campaign or special offer to propel it.

But determining ‘success’ isn’t just about numbers. ‘Loyalty’ – not big mailing lists with frequent email shots – is what keeps our audience ‘warm’. It is what builds the bridge between our audience and our Community Interest Company. I know for a fact that far more of our marketing consulting clients come from our regular blog readers than from our newsletter subscribers. In fact, the only thing that brings in as many clients are direct referrals.

Now It’s YOUR Turn…

OK. I’ve shown you the statistics. I’ve shared my side of the story and my own experiences. Now it’s your turn. Let me hear YOUR opinions on the key questions raised in this article:

  • Is email marketing a thing of the past? Do we still need it?
  • If we still need it, how can we use it in a different way so it creates a more engaging and less invasive experience for our audience?
  • Should marketers care about how many subscribers they have, either on their mailing list or for their blog?
  • Should our (ethical) marketing strategies now shift towards cultivating and nurturing web visitors instead of mailing list ‘leads’?

And, from the consumer point of view:

  • What would make YOU subscribe to a mailing list or blog?
  • What would make you unsubscribe?
  • Where do you think email marketers over-step the boundaries or ask too much from you?
  • Do you ever unsubscribe from things you actually like? Why?
  • Do you ever not subscribe to things you really like? Why?
  • What keeps you coming back to certain blogs, even if you are not a subscriber?

Let’s get the dialogue going. I want to hear what you have to say about this topic in the comments below. If you give me some nice, juicy stuff, I might publish a follow-up blog to share your views with our loyal readers. AND your opinions will definitely feed into a chapter I’m currently writing for my upcoming book on blogging (coming spring 2014…title to be announced soon!).

I look forward to reading what you have to share.

Lynn Serafinn
5 December 2013

References and Resources

Chaffey, Dave. 20 May 2013. Email marketing statistics 2013. Retrieved 3 December 2013 from http://www.smartinsights.com/email-marketing/email-communications-strategy/statistics-sources-for-email-marketing/

Epsilon. 8 October 2013. ‘Q2 2013 North America Email Trend Results: Marketers Must Segment and Test to Drive Continual Subscriber Engagement’.  Retrieved 3 December 2013 from http://www.epsilon.com/resource-center/research

MailChimp. 2013. ‘Email Marketing Benchmarks’. Retrieved 3 December 2013 from http://mailchimp.com/resources/research/email-marketing-benchmarks/

Signup.To. The 2013 email marketing benchmark report. Retrieved 3 December 2013 from http://www.signupto.com/email-marketing-benchmarks/email-benchmark-2013.

Silverpop. 2013. ‘Silverpop Email Marketing Metrics Benchmark Study 2013’. Retrieved 3 December 2013 from http://www.silverpop.com/Documents/Whitepapers/2013/WP_EmailMarketingMetricsBenchmarkStudy2013.pdf

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Tweep-e-licious: 158 Twitter Tips & Strategies for Writers, Social Entrepreneurs & Changemakers Who Want to Market Their Business Ethicallyby Lynn Serafinn, which can help you learn how to create meaningful collaborations through Twitter and other social media.

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Lynn Serafinn author of The 7 Graces of Marketing

LYNN SERAFINN, MAED, CPCC is a certified, award-winning coach, teacher, marketer, social media expert, radio host, speaker and author of the number one bestseller The 7 Graces of Marketing — How to Heal Humanity and the Planet by Changing the Way We Sell and Tweep-e-licious! 158 Twitter Tips & Strategies for Writers, Social Entrepreneurs & Changemakers Who Want to Market their Business Ethically. She is listed in the Top 20 of the Top Marketing Authors on Twitter by Social Media Magazine and was a finalist for the prestigious Brit Writers Awards. She also received the eLit Book Awards Silver Medal in Humanitarian and Ecological Social Affairs, as well as the Bronze Medal in Business and Sales. Lynn’s eclectic approach to marketing incorporates her vast professional experience in the music industry and the educational sector along with more than two decades of study and practice of the spirituality of India. Her innovative marketing campaigns have produced a long list of bestselling non-fiction authors through her company Spirit Authors. Lynn is also the Founder of the 7 Graces Project CIC, a not-for-profit social enterprise created to train, support, mentor and inspire independent business owners to market their business ethically, serve society and planet, and restore all that is best about humanity.

Twitter: http://twitter.com/7GracesMarketng

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