Even in this age of AJAX-driven, user-generated, mega-social networking websites, email marketing remains a very significant - and growing - force. Seventy-eight per cent of companies intend to increase their email marketing spend, according to research conducted by the Direct Marketing Association in November 2006. Similarly, the email services market is growing at 20 per cent per annum.

According to research from email marketing agency Adestra, though, The Email Marketing Industry Census 2007 - many firms are lax when it comes to tracking the effectiveness of their expenditure. The company warns that the current healthy growth is unlikely to last if more is not done to measure the revenue generated by such campaigns. Almost half (47%) of marketers are not conducting any return on investment (ROI) analysis of their email campaigns. While UK firms spent £178mn on email marketing platforms and services in 2006, this figure means that £84mn of the total is untracked marketing budget which may or not be working.

Given that DM has a reputation for measurability and efficiency, Adestra point out that this is quite a shocking figure. Marketing director Paul Crabtree pointed out, "It is critical for future growth, and makes basic business sense, to be able to measure ROI. In fact, it can severely stunt growth if you can't measure ROI as it will make proving the business case for extra investment almost impossible. The point is that email marketing is probably the most direct channel to be able to measure ROI - and it is a relatively simple process to enable it."

The company offers five tips to measure ROI in email campaigns:

1. Ask each customer how they found out about you
2. Invest in web analytics to track all orders back to where they began their web session from.
3. Use an email marketing provider that can integrate with your web site to track orders.
4. Monitor other inbound channels (telephone lines) and use discount codes/ special offers/ unique phone numbers to label enquiries and orders. Database systems like Wyvern Magic make this possible without massive investment.
5. Allocate and spend unrushed time analysing the performance of each campaign.

Four-fifths of those surveyed felt that their email marketing could be more effective. However, those companies that did measure the ROI of campaigns reported encouraging results. Fifty-five per cent said that that their return was three times or more, and almost a third reported returns of five times or more.

Full copies of the research paper are available through Adestra at www.adestra.com