This is part two in our SEO vs. Email Marketing series, in which we examine which channel is best for lead generation and insurance agency growth. Read part one here.
Email marketing has started to get a bad reputation among other marketing mediums. In fact, some professionals even go as far to say email marketing is a dying art.
Even my astute colleague relayed his opinions by writing this candid blog article. According to him, email is not the best marketing channel for your insurance agency.
While he has some valid points, I want to take this opportunity to analyze and rebut some of his assumptions. I will tell you how, once and for all, highly-targeted email marketing is thriving.
I’ll be so bold to say if you aren’t implementing it in your agency’s master marketing strategy, you’re doing it all wrong.
Assumption #1: Email marketing’s high ROI comes from “leverage[ing] brand affinity” and “opt-in emails.”
Let’s take a moment to talk about “the myth of the great email marketing ROI.” First, this is how to measure the average return on investment (ROI) for email:
ROI = (sales value) - (cost of campaign) x 100
(cost of campaign)
As you can see, to increase ROI you need to convert as many recipients into paying clients as possible.
Opt-ins and brand familiarity are important for getting emails opened. But, those do not exclusively influence your recipients to convert.
Email conversions happen when the content is compelling and call-to-action is clear.
Conversions are the primary driving force of ROI. Now, let’s consider the following statistics.
• Email has an ROI four times higher than other marketing formats like social media, standard mail, and paid search.
• 66 percent of consumers have made a purchase online as a direct result of an email marketing message.
• 4.24 percent of visitors from email marketing buy something, as compared to 2.49 percent of visitors from search engines and 0.59 percent from social media.
Assumption #2: “Agents must build large email databases and use targeted messaging to see success.”
I actually hear this from a lot of our customers. They believe the more email addresses they have, the better their conversions.
But, in email marketing it’s best to operate by quality over quantity.
You don’t need to waste time and money marketing to tens of thousands of leads. Instead, focus on converting a few hundred.
I will say the second part of this assumption is true: You must send targeted messages to see success. Segmentation and hypertargeting through personalization will help you nurture your database.
Don’t just take my word for it. Here is why you should be sending targeted emails to smaller, more valuable segments.
• Over 75 percent of email revenue is generated by triggered campaigns, rather than one-size-fits-all campaigns.
• Personalized email messages improve click-through rates by an average of 14 percent, and conversions by 10 percent.
• Personalized emails deliver six times higher transaction rates.
Assumption #3: Email marketing is not a “viable growth channel” because it does not “get new faces in the door.”
Yes, email marketing is more effective when your recipients know who you are. Preexisting business interaction and opt-ins are vital to your email marketing efforts.
That doesn’t mean new leads won’t see your emails.
With email, you can turn existing clients into loyal customers. They can refer friends and family, or buy multiple policies. Your audience may choose to forward your emails to their address book.
While email isn’t quite a gateway for brand new prospects, it should not be discounted for agency growth.
• The lifetime value of a new referral customer is 16 percent higher than your average customer.
• Referred customers are four times more likely to refer more customers to your brand.
• Word of mouth is the primary factor behind 20 to 50 percent of all purchasing decisions.
Bonus Assumption: Email marketing is popular because it is “easy to implement and track.”
DIY email marketing platforms have equipped even the most novice marketers. They can create and send beautiful emails with well-written copy to targeted contacts.
But, don’t let the simplicity of this process fool you. The world of email remains a complex and ever-changing landscape.
We are at the whim of external forces like email clients, mail servers, and rendering engines. Their changes often come without notice. Changes affect formatting, functionality, and even deliverability.
To assume email marketing is easy to put in place and track is a slippery slope.
Email marketing is popular and successful because it is cost effective. It generates high conversion rates through intimate dialogue between brand and consumer.
Still think ease of implementation drives email marketing’s growing popularity? Check out these facts.
• Triggered emails elicit 180 percent higher post-click conversion rates.
• Segmented and targeted emails generate 58 percent of all revenue.
A Better Alternative for Sustainability
Is email marketing great for cold lead generation? Absolutely not. But is it good for growing and nurturing your existing contacts into loyal clients? I give it a resounding yes!
Remember, your agency’s growth not only depends on new business, but also repeat business. Email marketing can be the most cost-effective way to enhance customer service and retention.