Govtech Companies are Neglecting Email Marketing

This is part 1 of a series on effective email marketing to local governments.

The results of a first-of-its-kind research project are in – govtech companies are seriously neglecting email marketing. In numerous studies over the last decade, email has been rated the most effective and highest ROI marketing channel. It is particularly important in B2B and B2G environments. Yet only 52 out of actively marketing Govtech 100 companies have a regular email newsletter, and only 25 of 100 bother to send out even one email to their subscribers during the first two weeks after capturing a prospect’s email address. In other words, just 25% of govtech companies capture emails on their website AND send an initial email within 2 weeks. Yikes! By comparison, 77% of B2B marketers offer email newsletters (Source: Content Marketing Institute, 2016). While COVID-19 is amplifying the importance of digital marketing, (Source: Bain & Company, 2020), 3 out of 4 Govtech providers are almost completely neglecting email. In consideration of this stunning finding, let’s briefly review why email is so vital for marketing success.

Email is (Still) the ROI King

Despite the emergence of a seemingly endless number of online marketing vehicles over the last few decades, email remains the ROI king:

Email delivers the highest ROI among all marketing channels, on or offline (ProfitWorks/eConsultancy, 2019 and VentureBeat/ Campaign Monitor, 2015)
59% of marketers say email is their biggest source of digital marketing ROI (Emma/ Hubspot, 2018)
Email returned $42 for every dollar spent, up 30% since 2015 (Direct Marketing Association of the UK, 2019)
Email returned $38 for every dollar spent (Direct Marketing Association of the US , 2015)

Why email is so effective

A confluence of factors contribute to email’s success:

Global reach. Email is used by 91% of Internet users, more than any other digital activity (eMarketer, 2019)
Reach vs. social. There are 3x more email accounts than Facebook & Twitter combined (Campaign Monitor, 2019)
Time. People spend an average of 5 hours per day reading email, 3 of which are work related (Adobe, 2019)
Delivery. 90% of email gets delivered to the intended recipient’s inbox, vs. only 5% of Facebook fans see a typical post (Campaign Monitor, 2019)
Engagement. 3.7% of recipients “click thru” on emails, vs. 0.58% on social media (OptinMonster, 2019)
Conversion. 60% of consumers report making a purchase as a result of an email they’ve received, vs. only 12.5% from social media (OptinMonster, 2019)
Average order value (AOV). Email’s AOV is 35% higher than social media’s (Growcode/Statista, 2020).

Email in B2G

While the Internet is flooded with reports on email marketing for B2C and B2B companies, we couldn’t find any published research on email marketing for companies serving local, state or federal governments.

So we did a little research of our own.

We started with one of the most well-known list of B2G companies, the GovTech 100, 2020 edition (compiled by Government Technology). We removed from the list four companies that were not yet actively marketing their services (e.g., The Boring Company), replacing them with four from the 2019 list that still are (e.g., City Zenith), to keep an even 100 firms in our sample.

We visited each of their websites and assessed whether they were using three basic email marketing techniques:

Does the company offer an email newsletter? (why you need one, Campaign Monitor)
If not, do they try to capture visitor’s email addresses by offering content in exchange? (why it’s important… and how to do it, Neil Patel)
For those that do capture an email address, do they follow-up? To assess this, we submitted an email address to all 67 of the companies who asked for one, then watched our inbox for the next two weeks (would you rather have a customer NOW, in two weeks or never!?, CoSchedule)

Caveat: We should note that all of the Govtech 100 companies have website forms with direct sales solicitations or “demo requests. ” But we considered those to be sales efforts, not email marketing. Also, we’re NOT suggesting that the three email marketing techniques we measured, while critical, are the only valid ones. Other approaches are available and should be considered, including the use of high-quality, purchased lists.

Our Research Findings

The results: We were stunned at the neglect of email marketing best practices, as summarized here and in the four charts below.

Only 2/3 use their website to capture emails for marketing purposes
Just over half (52%) offer an email newsletter
Among those that DO capture email addresses, only 37% bother to send an email within two weeks
Putting it all together, 75% of govtech companies are not implementing even the most basic email marketing practices – capturing emails AND sending an initial email within 2 weeks.

Conclusion

If the Direct Marketing Association is right, and email returns $38-$42 for every dollar spent, there is a lot of money being left on the table by govtech marketers.

In part #2 of our series, we debunk some common local government email marketing myths that, if believed, could seriously hamper your growth.