Two years have come and gone since Canada’s Anti-Spam Law, better known as CASL, was introduced. Ever since the legislation received royal assent it’s conjured up strong emotions in either direction. For some CASL was the best thing to happen to the email industry, while for others it was the worst. To get a firm answer as to the real impact of CASL on email marketing, we decided to take a closer look.
In early 2016 Inbox Marketer, along with Industry Canada, set out to learn just what sort of impact CASL has had on the email industry. (The full report can be downloaded for free here). During the past two years, there have been some profound and positive changes in the email industry, both at home in Canada and abroad.
5 Key Facts & Observations
- Reduced Spam
CASL is proving effective in reducing inbox clutter. A study by Cloudmark Inc. assessed email traffic in the eight months following CASL’s implementation and found that there was a 37% reduction of spam originating from Canada.
This significant decrease in spam may be largely attributed to the strict enforcement stance of the Canadian Radio-television and Telecommunications Commission (CRTC). Since July 2014 the CRTC has issued major Administrative Monetary Penalties (AMPs) against a number of high-profile companies, including Rogers Media Inc., Compu-Finder, Porter Airlines, and the online dating site Plentyoffish.
- Email Volume Has Increased
Since July 1, 2014, Inbox Marketer has witnessed the total number of emails sent increase by 25.5%. During this same time period, the total number of email campaigns also grew considerably, rising 17.5%.
While both numbers represent strong growth, it’s positive to see total email volume growing at a greater rate in comparison to total campaigns sent. This means that the average email campaign grew by 6.9% - strong year-over-year growth.
It would seem that CASL hasn’t had the damaging effect on email programs that some experts predicted prior to CASL’s implementation. Instead, we are seeing that it is business as usual for many marketers and some are experiencing growth in their list size.
- Email List Growth Has Steadied
List growth is where CASL was expected to have its greatest impact. Successful email marketing is dependent on healthy growth in email list size each year and it was expected that CASL would have a negative effect on this growth.
According to a survey conducted by Constant Contact, 65% of small businesses’ mailing list size remains unchanged since CASL’s implementation, 25% have seen a decrease in list size, and 10% have increased their list size. CASL has also had minimal impact on business metrics for individual small businesses, who stated that the effect on customers, prospects, profitability, gross revenue, and overall success largely remained unchanged.
Despite this positive news, marketers have needed to be more strategic with their list growth practices to maintain their list size, and even so, their lists have likely grown at a slower rate. The key for marketers in both attracting and retaining subscribers has been to build better sales funnels, be more aggressive in their list growth strategies, and provide more targeted and relevant content.
- List Hygiene and Trust Metrics Improved Remarkably
List hygiene metrics under CASL have improved greatly. Since CASL was implemented in July 2014 average unsubscribe rates have decreased from 0.22% to 0.19% and average complaint rates have dropped from 0.03% to 0.01%. Inbox Marketer has also observed a decrease in average bounce rates (Bounce rates represent the percentage of sent messages that cannot be delivered.) from 0.61% to an average of 0.58%.
This reduction in unsubscribes, bounces, and spam complaints suggests that CASL is deterring would-be spammers from sending unwanted emails and at the same time, allowing legitimate email marketers to increase the quality of their lists and the relevancy of their email campaigns.
- Email Marketing on the Rise as a Consumer Messaging Channel
Despite the much touted negative impact that CASL was predicted to have on the email industry, email marketing continues to be the #1 ranked digital messaging channel with a reported ROI of over $40:$1. According to a 2016 report from Salesforce, 80% of marketers still believe email marketing is core to their business and in the next two years, 97% of marketing leaders plan to either further increase or maintain their level of spending on digital marketing.
For small businesses that were using email marketing when CASL went into effect, much has remained unchanged. According to Email Service Provider (ESP) Constant Contact, 70% of small businesses have continued to use email marketing as they had always done, and some have even increased their efforts (9%) or started email marketing for the first time (6%). Only 13% have decreased their email marketing activity and just 2% have stopped altogether.
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Download our "The Impact of CASL on Email Marketing" report to learn more about CASL (Canada's Anti-Spam Legislation) and its benefits for Canadian consumers and organizations.