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Email now accounts for 14% of digital marketing spend

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According to research for Econsultancy's Email Marketing Platforms Buyer's Guide 2009, UK businesses now spend, on average, 14% of the digital marketing budget on email and the market will grow 15% this year. The UK market for email marketing platforms and services is now worth £292 million, says Econsultancy.

The estimate is based on a revised valuation for 2008. Before the full impact of the recession had been felt, Econsultancy estimated that the market would grow by 24% to a value of £274 million by the end of 2008.The valuation includes revenue earned by email service providers (ESPs), money spent on agency services and the cost of internal staff resources relating specifically to email.

Key market trends identified for 2009 include:

  • Email service providers reap benefits of focus on channels driving return on investment

  • Segmentation and behavioural targeting become established as best practice

  • Marketers attempt to connect email with social media

  • Lack of strategy holds back email marketers

"As an industry, email marketing continues to flourish because it is inherently accountable and more measurable than other areas of marketing, providing a high return on investment at a relatively low cost," says Linus Gregoriadis, Econsultancy's research director. "Many companies are diverting budget from direct mail to email marketing."

"During the recession, the focus has been very much on building relationships and selling to existing and prospective customers," Gregoriadis added. "Aside from just basic broadcast of email, companies are continuing to invest in additional email services, including measurement and analytics, segmentation and personalisation."

"However, our research has also found that the lack of a strategic approach is holding back some marketers from optimising their email communication and preventing them from getting the best return on their investment."
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