8 Reasons Why Email Marketing Delivers the Highest ROI

On the hunt for a marketing strategy that delivers exponentially but doesn’t cost a fortune? Email marketing is the answer that you’re looking for. 

Not what you expected? The truth is that email marketing is thriving today even with the extensive usage of social media. As per a report from Litmus, email marketing has a Return On Investment (ROI) of 4200%. This means for every dollar you spend, you get a return of $42. 

But why does email marketing have such a high ROI? We explore 8 reasons why emails perform well compared to their cost. But let’s start with defining what ROI is. 

What is Return on Investment (ROI)?

Simply defined, Return on Investment or ROI is the percentage of an investment’s profit relative to its cost. While there are multiple ways of quantifying performance, ROI makes the most sense. If a strategy is not profitable for your brand, why continue with it? 

ROI provides a perspective of what is working, what can be improved, and what should be let go of. 

8 Reasons Why Email Marketing Has a High ROI

Curious why email marketing has such a high return compared to its cost? We explore 8 reasons why below; 

1. It is permission-based marketing.

Not all marketing efforts are welcomed with open arms. Customers today are incredibly picky about the messages that are promoted to them. In an ideal world, they would want to hear from brands that they’ve given their consent to. 

The emails you send are to those people that have signed up to listen to you. Through lead magnets and limited-timed incentives, you can entice your audience to share their email addresses. We never recommend buying email lists. If you do so, then you’ll be creating for yourself a spammy reputation. 

When permission is involved, customers are more willing to accept messages and perform the action you’re aiming for. This is because they are in the right mindset to purchase. 

2. It is widely checked.

Email is not only widely used but widely checked as well. According to OptinMonster, 99% of people check their emails on a daily basis. Let’s prove our point through basic math. 

If you have 2,000 email subscribers, then 1,980 (2000 x 99%) of them will surely have some contact with your email. 

In our next example, let’s keep the number of subscribers consistent but change the digital marketing medium to Instagram.

If you published an Instagram post, you can’t guarantee that 2,000 (or even 1,980) of your followers were shown the post. This is courtesy of Instagram’s algorithm and 63% of people who check their Instagram daily. 

When emails are checked on a daily basis, it is less likely that your audience will miss yours. Hence, giving you the advantage to reach a wider audience base. 

3. It is cost and time effective. 

The reason why email marketing has such a high ROI is that its cost is minimal. You can even design and execute email campaigns completely free of charge. No, that’s not a marketing gimmick – we explain how below. 

There are many tools for email marketing that let you create stunning emails through their drag and drop editor and library of free email templates. In addition, you can further send free emails to your subscribers, but to a limited number, of course. 

Even if you use the premium versions of these email marketing softwares, the cost is low compared to the profits realized. 

Apart from being cost-effective, designing emails is not a time-consuming process. By using ready-to-made HTML templates, you can create impactful emails within a matter of minutes. Many template providers provide the facility of design blocks. The latter lets you save design sections that can then be added to future templates to save your valuable time. 

4. It is personalized. 

According to Segment, 71% of customers feel frustrated when their shopping experience is not personal. With email marketing, your customers will never feel this way since it’s highly personalized. 

In email marketing, you can use merge tags to address your audience with their first or second name, whatever you please. Dynamic content templates show your subscribers parts of an email content relevant to the characteristics defined. For instance, to promote the launch of your spring clothing collection, male subscribers will be shown pictures of male clothes and vice versa. 

You can further personalize experiences with respect to how customers interact on your website. For example, if you witness a customer abandoning a cart after adding items to it, an email can be sent to them offering free delivery to complete the sale. 

Email marketing is probably the most personalized digital marketing medium out there. Take the example of social media. Your one tweet or Facebook post is shown to your complete followers; you cant decide who from your list sees a post and who doesn’t. But, as we saw in email marketing, you can send customized messages to different segments of your audience. 

5. It is great for increasing website traffic. 

Low on traffic on your website? No worries, email marketing has got your back. 

Have a look at the different emails in your inbox. Almost all of them have a call to action button or link which redirects to a website’s landing page. If the email copy is compelling enough, it’ll encourage your readers to click on the link or button provided. 

With email marketing, you’ll be able to boost your website’s traffic in a short span of time. Contrarily, if you were to increase footfall through SEO, it’ll take a significant amount of time – somewhere between 6 months to a year, to be exact. 

Another positive of improving website traffic through email marketing is that all the redirected audience will be relevant. Your email subscribers are interested in knowing more about you -they gave their email addresses for a reason. Hence, all traffic you receive through emails will lead to a desirable action. 

6. It is easily automated.

To engage customers, you constantly need to be in touch with them. On social media, you consistently need to be uploading stories, posts, lives, and whatnot. With content marketing, you are routinely curating helpful blogs. But with email marketing, you do the hard work once and leave the rest to the automation bots. 

Automation in email marketing sends strategic emails instantly once a customer performs a specific action. Thanks to autoresponders and workflows, you can create if and now scenarios on which different emails will be sent.

To help you understand this further, reflect on the next example. A customer who signs up for a free ebook receives it instantly. If s/he downloads it within a couple of days, then all the better. If not, a reminder email is sent to them to download the ebook.

These timely opportunities are realized effectively through automated email messages. Most customers are unable to make their minds with a company’s first interaction. These consistent reminders boost their confidence to share their money/time/personal information with the brand in question. 

7. It is simple to measure. 

Email marketing is easy and stress-free to monitor. The fact that it has a high ROI is because all figures are displayed in front of marketers to play around with. This comes as a relief since 60% of marketers believe that measuring the ROI of social media marketing is one of the biggest challenges they face.

Apart from ROI, the following metrics can easily be measured; 

  • Open Rate: The percentage of emails that your subscribers open.
  • Click-Through Rate: The rate of people who click a call-to-action button or link within your email. 
  • Deliverability Rate: This is the percentage of emails that reach your audiences’ inboxes.  
  • Unsubscribe Rate: The rate of people who unsubscribe from receiving your emails in the future. 

By measuring these metrics over time, email marketers can improve the performance of the emails designed. Subscribers can be asked to provide feedback about the quantity and quality of emails received. The latter can be done through short survey emails or one-on-one discussions with them.  

8. It is uncomplicated to test. 

Many email marketing softwares make it easy for you to A/B test emails. You can test a differing variable among two groups of subscribers to measure which performs better. 

For instance, take a percentage of your audience and divide it into two groups. You can then send the same email with different subject lines (one with and one without an emoji) to these groups. After the campaigns have been made live for a set time period, measure which email had the higher open rate. Go for the subject line that resulted in the higher opens. 

How does this increase ROI? Well, when you test emails prior to launching them, you’ll already know what works. Hence, increasing the return on them once the campaign is made live. 

The Final Word

Email marketing generates the highest ROI amongst its counterparts. This article uncovered 8 reasons why email marketing delivers high returns relative to its cost. We’re positive that designing and executing emails will now be an integral part of your marketing strategy.

Got something to add? Mention in the comments below. 

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