Tuesday, October 10, 2006

In Online Spin Today,
Seana Mulcahy notes:

The latest Future Spending Index from consultants Retail Forward Inc. just came out, predicting that shoppers will increase their spending in October. The Future Spending Index stands at 99.1 in October, up from 92.7 in September. There are some critical factors that seem to be boosting consumer confidence: gas prices finally dropping, the stock market hitting new records and job openings.


52 percent of consumers plan to shop online. These consumers plan to spend about the same as they did last holiday season. Up Market consumers (those with incomes of $75,000+) are predicted to spend 20 percent more online, while Down Market consumers ( Incomes less than $22,500) say they don't shop online.

A holiday shopping forecast by The Performics 50 states that fourth quarter 2006 online sales will eclipse those of last year by 53 percent. This will be about equal to the total sales of both Q1 and Q2 2006, combined. The company also noted that competition for higher-priced, more popular keywords in sponsored search engine advertising has increased significantly.

Monday, October 02, 2006

E-Mail Marketing Getting High Click, Open, and Conversion Relative to Cost

WebSurveyor Corp.'s August survey reveals that web merchants plan to increase e-mail marketing spending efforts. 18.4% expect to grow their opt-in lists by more than 50% within the next year, while another 25.1% will increase their lists by 16% to 50%.

Reported by Mark Brohan in a recent article, he says that 73% of chain retailers, catalogers, virtual merchants and consumer brand manufacturers taking part in the monthly survey on e-mail marketing, spend 5% of their marketing budget or less on e-mail marketing, yet just over half of respondents, 50.6%, report that 6% or more of their sales come from e-mail marketing, with 25% saying the proportion is over 11%.

63.8% of retailers conduct up to three e-mail campaigns each month and another 25.2% conduct between four and eight campaigns, says the report. 62.8% also indicate that they've increased the frequency of e-mail campaigns in the past year.

E-mail marketing consultants consider an open rate of about 20% and a click-through rate of 4% to 5% to be a highly effective e-mail campaign.
- 26.5% of participants in the survey report open rates of 20% or more (11.2% reported 20% to 25% while 15.3% said more than 25%)
- 11.8% report open rates of 16% to 19%
- 14.6% report e-mail open rates of less than 5%
- 6.2% say open rates of 1% or less.

Click-through and Conversion averages are growing:

- 17% report e-mail click-through rates of 16% or more
- 28.9% report click-through rates of 6% to 15%.
- 20.2% of respondents report e-mail sales conversion rates of 1% to 2%
- 26.5% with conversion averages of between 2.1% and 4%
- 14% with conversion rates of between 4.1%
- 10%, and 3.2% with sales conversion averages greater than 10%

Compared to paid search, he says, which can absorb up to 50% of a big retailer's total annual online marketing budget, e-mail marketing remains relatively inexpensive.

- 41.6% of all retailers taking part in the research spend less than 1% of their total annual marketing budgets on e-mail. That compares with
- 31.3 % spend between 1% and 5%
- 13.8% commit 6% to 10%
- 5.6% spend from 11% to 15%
- 3.8% from 16% to 25%
- 4.1% with e-mail budgets that account for 25% of their overall marketing budgets