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Beware of Confusing, Conflicting Stats About Marketing ROI

by Tom Ruwitch

I recently saw a fancy infographic full of stats about email marketing.
It made my head spin.

Under the heading “Email Marketing ROI,” the graphic declared, “Every $1 spent on email marketing generates $38 in revenue.”

Wow! That’s pretty good.

But wait…

Underneath that, was this claim: “Email marketing ROI is 28.5% compared to only 7% for direct mail.”

I’m no math whiz, but I translate that second stat to mean if you spend $100, you’ll make $100 + $28.50 (28% of your investment) for a total of $128.50.
Didn’t the first stat suggest I would generate $38 for every dollar spent – or $3,800 if I spend $100.

Which is it?

Beats me.

Here’s another gem from the infographic: “Revenue per email is $0.11.”
Where does that stat come from? Is that an average across all industries? Does the locally owned restaurant make $0.11 per email or is it the spammer pitching little blue pills or is it the airline pitching high-priced vacation packages?

Will I make $0.11 per email if I purchase list from Billy-Bob’s Discount Email List Vendor?

Will I make $0.11 per email if I send irrelevant garbage to people who aren’t in my target market?

Are those people generating $0.11 per email pros or posers?

Combine that $0.11 stat with this one: 18% of companies report an ROI of more than $76.

Wow! $76 is twice as much as $38 (see the first stat) and WAY better than a 28% ROI (see the second stat).

Wondering which businesses make up the luck 18% who kill it with $76-to-$1 ROI? Me too. The infographic doesn’t say.

What do these statistics tell you, the small business person, who wonders whether email marketing is right for your business and wondering how much to budget?

Nothing. These stats tell you nothing!

Check that. These stats tell you that some marketers try to throw a bunch of meaningless, contradictory data to bolster claims about their products.

In fact, at the bottom of this infographic is the following chest-thumping: “(Email is) the rock-solid, time-and-customer-tested, marketing-approved way to keep your customers coming back for more. And here are the stats to prove it…”

Don’t get me wrong. I think email marketing works. But I’m not going to promise you 38-to-1, or 76-to-1 or 11-cent per email return on your investment. Such stats are misleading garbage.

Your business is unique. Your products and services are unique. Your marketing copy is unique. Your marketing tactics are unique.

Yes, I believe that businesses can generate great ROI if they employ good list-building practices, deliver engaging content to their followers, include strong and compelling calls-to-action for sales and focus on maximizing the long-term value of customer relationships.

But the only way for you to know whether you’ll generate 38-to-1 ROI (or more, or less) for your business, is to measure your investment and your return.
All the other stats are just a bunch of confusing, conflicting noise.

Tom Ruwitch is the president and founder of MarketVolt, an interactive marketing firm. For more business-building marketing resources by Tom Ruwitch, go to MarketVolt.com/resources.

Submitted 23 days ago
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Categories: categoryHigh Voltage Marketing
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