Thursday, December 10, 2009

The value of an email address

"What's each customer email address worth to you?" I asked a client a year or so ago, when we were discussing their future email marketing plans. We then set-about finding out the Lifetime Customer Value of the company's email database (and further important calculations). In other words, we tried to model the revenue per email address over time, with some interesting learnings along the way.

These days its not effective enough to measure just the cost of each campaign and work out the average revenue per email... You have to have a good idea of the total worth of these accounts and try to understand the customer buying profile(s).

To take the stress out of calculating this yourself, the Direct Marketing Association (DMA) have done this work for you . They found on average that an email address is valued at £9.11

However, its should be remembered that:
  1. This research was done in late 2006 / early 2007, so you need to amend this according the the rate of inflation over time
  2. This is only an approximate average from a number of companies in different sectors, therefore it is probably a good thing to do your own modelling and mathematics
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