How Low Deliverability Will Impact Your ROI

Posted by DanaPereira on

Email is still regarded as the fastest and most effective marketing channel today. With an average return of $44.25 for every dollar spent, it’s not surprising that companies are continuing to increase their investments in this channel year over year.

But how does a company quantify their investment to ensure they are actualizing this return? The formula appears relatively simple: you take your volume, factor in several metrics, and voila, you have your expected profit. Simple enough, right? In actuality, when you take into account all the challenges of getting that one email into your subscriber’s inbox, things become much more complicated.

With so many different mailbox providers and filtering and spam technologies, each on a constantly evolving path, it’s easy to see why so many companies struggle with deliverability. Without the right guidance and expertise it can be nearly impossible to understand what combination of art and science will not only get your email delivered, but delivered to the inbox. In fact, a recent Return Path study found that one out of every five emails fails to make it to the recipient’s inbox. That means there is a significant return being left on the table, and unfortunately, it doesn’t matter how many emails you send; if you’re not reaching your subscriber, you’re never going to achieve maximum ROI.

So how do you change this? How can you increase the effectiveness of your program? The key is to focus on inbox placement and drive your opportunity to have subscribers receive your email. If you are consistently getting blocked or bulked by mailbox providers then you’re already limiting your potential return without even having any customer input.

To take this a bit further, let’s look at a couple of examples of some great senders who discovered firsthand how increasing inbox placement can directly correlate to a boost in ROI.

Dillard’s, one of the nation’s largest retailers, uses its email program primarily to target subscribers based on their purchase history. Despite observing industry best practices, they noticed a sudden drop in open rates. Working alongside Return Path’s team of email experts they were able to identify significant deliverability issues which were causing blocking problems at AOL, Hotmail, and Yahoo.

Within the first 30 days of working with Return Path, Dillard’s was able to improve their inbox placement rates to just shy of 100%, which corresponded to an increase in email revenue and in-store foot traffic.

Michael Hodapp from Dillard’s digital marketing team wrote, “In terms of ROI, beyond helping us to secure a profitable holiday shopping season, we see the returns every day as our email revenues continue to grow.”

In another example, Custom Direct utilized Return Path’s Email Optimization suite and our team of Professional Services consultants to increase their deliverability from 70% to 99%. This 29% lift in inbox placement rates resulted in an 18.4% increase in total sales derived from their email program within their first year of working with Return Path.

Finally, there is Citrix who was challenged with frequent blacklisting, spam placement, and high missing rates. Through the use of Return Path Certification program they were able to boost their inbox placement rate to 95%. This increase on one of their highest revenue-driving emails resulted in a 30-40% boost in response rates and had a lasting impact on ROI.

All these examples provide clear evidence that improving inbox placement rates can have an impact on your bottom line. Imagine if the average ROI per dollar spent increased to $50 or $100…What could that kind of boost could that give your company?

 


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