North American Email Has High Failure Rate

February 9, 2010

Twenty percent of email in the U.S. and Canada is not making it to the inbox, according to a new study from email deliverability services company ReturnPath.

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Reasons behind Low Email Deliverability

There are several reasons why these numbers are low, according to results from the ReturnPath Global Deliverability Benchmark study for the second half of 2009:

1. Many senders still don’t have access to reliable data on their deliverability situation. Instead they rely on reports that show a “delivered” metric that tends to be 95% or higher. According to Return Path, in most cases this is not the Inbox Placement Rate – the percentage of mail that actually arrives in the inbox. Rather, it is simply a reporting of the number of messages sent minus the number that returned a hard-bounce message. This creates a false impression that nearly 100% of email messages arrive as intended.

2. Senders are leaving a lot of money on table – on average about 20%. This is because marketers find it easier to concentrate on the money they can make – especially since email is a low cost channel. But such thinking make it easy to disregard or overlook lower deliverability rates, Return Path says.

For example, if a retailer deploys a campaign to 1 million subscribers with an average conversion rate of 5% (50,000 buyers) for a value per conversion of $10, it should earn $500,000 in revenue from that campaign. But if 20% of the retailer’s email never made it to the inbox, then the numbers look very different. With an 80% inbox placement rate, only 800,000 subscribers would receive the retailer’s email and at the same conversion rate and value, its email revenue drops down to $400,000 for that same email campaign.

Multiply that by the number of campaigns sent every year and it turns into millions of dollars in lost revenue. What senders fail to realize is that those dollars can be recouped simply by maintaining a good reputation and implementing basic best practices that are proven to improve inbox placement. While achieving 100% deliverability is key, even a 5% increase to inbox placement results (for this example) in $100,000 more in revenue per campaign.

3. Senders are still failing to implement best practices around reputation and behavior. Reputation is the driving factor that determines whether or not email makes it to the inbox, Return Path says. However, not all use such tactics as welcome messages or easy opt-out procedures.

4. Global campaigns require different approaches. The Return Path survey also found better deliverability rates overseas. In Europe, 85% of email arrives as expected with 3.6% ending up in the”junk” or “bulk” folder and 11% not delivered at all. Asia Pacific does better than Europe and North America with 86.9% of email delivered to the inbox, 3% is “bulked” and another 10% is missing.

Retail Email Jumps in 2009

Despite this high email failure rate, top online retailers substantially increased the volume of promotional emails they sent subscribers, according to Chad White, research director at Responsys and author of the Retail Email Blog. White’s research indicates that top online retailers sent an average of 132 promotional emails to each of their subscribers.

On a monthly basis, that averages out to 11 emails a month and 2.5 emails per week per subscriber. By comparison, top online retailers sent an average about 118 promotional emails to each of their subscribers in 2008 and about 95 promotional emails to each of their subscribers in 2007. The volume of promotional retail emails grew 12% from 2008 to 2009 and 39% from 2007 to 2009.

About the Survey: ReturnPath conducted the Global Deliverability Benchmark for the second half of 2009 by monitoring data from its Mailbox Monitor service for email campaigns deployed from July to December 2009. ReturnPath tracked delivery, blocking and filtering for more than 600,000 campaigns. In addition, ReturnPath reviewed non-delivered data for hundreds of ISPs in the United States, Canada, France, Germany, United Kingdom and the Asia Pacific territories.

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