July 11, 2016 by Ashwin Ramasamy

At any given point in time, email marketing is a better customer acquisition channel than adwords (or search engine marketing, in general).

Why? The answer is economics.

Adwords or other search engine marketing channels fundamentally are auction houses. They have a limited inventory of ad spaces (top of the page / side of the page that display search results). When the space is finite and you’ve competition looking to advertise for the same keyword, you both bid.

In a bid situation, the price is not just a function of the effort it takes to reach a customer but the competition that you need to beat to get there. Supply & Demand are at work. When the supply of ad inventory is limited but the demand is high, prices go up.

If you are in an industry where there is heavy competition and where everyone uses adwords, you can safely assume that the cost of adwords escalates over time, as you compete for the limited supply.

But email is a curious case. It’s as targeted a channel as one can get. It’s obvious that when you have an email id of a decision maker and you’re emailing them, they’re the exact audience you want in.

The difference between adwords and email is that, the former is intent driven (one who visits your site clicking on an ad is interested in you, probably!) while the one whom you emailed need not be in the market for your services. However, an argument can be made out that one who clicks your email link or responds positively is favorably disposed to your offering.

But email comes with its own set of frictions.

  1. Building a lead database and maintaining it is a laborious task
  2. Not everyone knows how to write kickass email subject and content
  3. It’s humanly impossible to keep track of news and insights about every prospect you’d be emailing

Most email marketing efforts are non-starters for the above reasons.

Every now and then, an industry altering event happens and rewrites accepted rules of engagement. Outbound marketing is going through one such shift. Data science has made it possible to collect and curate lead lists and insights about prospects in a click of a button. It’s possible now to scale campaigns and yet be personal. It’s possible to be relevant to each prospect and yet reach 100s in a day.

In PipeCandy, we ran an RoI comparison between the older way of email marketing and the data science led email marketing. The latter is better than the former by 16 times! When you see such improvement in the efficiency of a channel, you can anticipate the disruption coming.

The question is, are you in right side of the shift – Are you going to retool your marketing arsenal or will you be busy writing ad copies and miss the writing on the wall?

Ashwin Ramasamy

Co-founder @ PipeCandy

Slips poor jokes & gets away with a poker face. Carries a no BS attitude at getting things done. First to arrive at the office, Ashwin’s energy does not ebb through the day. Ashwin is one of the co-founders and he sets the tone for marketing, sales, design & culture.