Email marketing is big business. According to one research report, businesses will spend $6.2 billion a year on email marketing software and services by 2018. Why are companies spending so much? Are they spending that money wisely?

The quick answers are 1) because they have no choice, and 2) no, not really. To explain further, here are the five overarching trends in email marketing that will continue to play themselves out over the next year:

1. Classic lead generation methods are failing.

First, some quick background. There are two generic types of marketing: inbound and outbound. With inbound marketing, you wait for potential customers to find you and then you react. With outbound marketing, you take action to find potential customers.

Inbound is great if you're getting plenty of Web traffic. Most companies, however, need a reliable way to create a sales pipeline. That means doing outbound marketing and being active rather than passive.

Traditional outbound marketing consisted of four elements: direct mail, trade shows, trade advertising, and cold calling. These lead generation methods, however, have been yielding fewer sales leads every year. Here's why:

  1. Direct Mail. While direct mail apparently still works for consumer goods that fit well into catalogs, business-to-business buyers have long since moved to purchasing on the Web rather than from catalogs. And nobody reads a junk mail that's disguised as a business letter. Who sends business letters anymore anyway?
  2. Trade Shows. While exceptions exist, at an increasing number of trade shows vendor attendees vastly outnumber potential customers. This makes sense, because trade show companies make money selling booth space rather than tickets. Unfortunately, that means real sales leads can be few and far between.
  3. Trade Advertising. Advertising in trade journals was once thought to be a targeted way to reach potential customers. However, trade journals consistently over-estimated their readership and the impact of their ads, a fact that became abundantly clear (from the absence of clicks) when trade journals went online.
  4. Cold Calling. With smartphones and caller ID, few businesspeople answer calls from people they don't know, even when those calls are legal (which they frequently aren't.) An increasing number of businesspeople no longer use voice mail, which is why you run into so many "mailbox full" messages nowadays.

As these traditional techniques have foundered, sales and marketing teams have turned to the only outbound marketing technique that still works consistently: email. Hence the sudden interest.

2. Email marketing is growing like crazy.

Because so many companies are turning, in desperation really, to email marketing, the companies that sell email marketing software and services are acquiring new customers every day. One company alone, MailChimp, claims to have 14 million customers.

Between you and me, that number sounds bogus, because, according to the most recent U.S. census data, there are only about 30 million businesses in the U.S. I doubt if half of them are using that particular product. (MailChimp may have international customers, though, so who knows?)

Regardless of the number of users in absolute terms, there's no evidence that the growth in email marketing is slowing. Market researchers are predicting that sales of email marketing software and services will continue to grow at an insanely aggressive compound annual growth rate (CAGR) of 20 percent over the next five years.

So if 14 million is an exaggeration, it may not be for very long. What this means to you and me is that our email Inbox--which is probably already flooded with bulk email--is likely to become even more stuffed to the gills. Something to look forward to, eh?

3. The cost of email marketing is declining.

You'd think that sending a thousand emails (from the perspective of the bits and bytes involved) would cost almost exactly that same as sending a single email. Therefore, email marketing should, like basic email, be free, right?

Wrong! Email marketing software and service providers must not just make their programs easy to use, they must also implement safeguards and checks to prevent companies from spamming. Failure to do so could cause real problems for these vendors, like having their Internet privileges revoked.

Because of this, email marketing software has tended to be pricier than you'd expect. However, the laws of competition are gradually bringing down prices, even in the face of rapid market growth. Because of this, email marketing is becoming more affordable every day.

While this is good news for companies that want to do email marketing, it also tends to accelerate the overstuffing of inboxes, which continues apace. Alas.

4. Analyst blather is muddying the waters.

Whenever a technology gets hot, a horde of consultant and pundits descend upon it like a horde of pointy-headed locusts. And boy, has that been true of email marketing.

While researching this column, I ran across a list of predictions from a group of "email marketing experts." The list featured impenetrable observations like:

  • "Hyper-personalization is becoming a reality."
  • "Guidance for triggered marketing sequences is a necessity."
  • "An enterprise supplier-agency-model is needed for digital transformation."
  • "Functional chunks will be the next step in modular evolution."
  • "Mid-market platforms are proven big game hunters."
  • "[There will be] widespread integration of machine learning."

Hilariously, email marketing vendors apparently take this galloping codswallop seriously. And that's ironic, because the real issue with email marketing is...

5. Most companies do email marketing poorly.

For the past five years, I've distributed a free weekly newsletter to about 30,000 subscribers in which I critique their sales emails and email marketing for free. I've seen hundreds of examples of real-life emails. I've also worked with a couple dozen companies on targeted email campaigns with rigorous testing.

I know from experience that the average marketing email is awkward, stupid, and off-putting. Most companies cram their emails with irrelevant information, multiple links, cheesy stock photos, and confusing calls-to-action. And then they wonder why they don't get much response.

To make matters worse, the email marketing vendors have built these worst practices into the defaults for their product, which is why most marketing emails you get in your inbox look like 1990s sales brochures.

However, even though most marketing emails do little more than annoy their recipients, email is so pervasive in business that enough of the turkeys get opened to justify the expense of the marketing campaign. As the saying goes: "Even a blind pig finds a truffle once in a while."

So that's where we are. Companies are glomming onto email marketing because nothing else works for inbound marketing. However, they then do a lousy job at creating emails that people actually want to open, read, and answer.