|
|
|
Subscribe to Advertising & Marketing Review!
Contact Ken Custer at 303-277-9840.
|
|
|
|
|
|
|
Using Email In The Direct Marketing Mix
By Brian Rainey, President of Abacus, a division of DoubleClick
Email has become a powerful component in the arsenal of many direct marketers. As a direct marketing tool, email is faster, cheaper and more measurable than many other forms of direct marketing. Nevertheless, it has been shown to be most effective when used in combination with other direct marketing disciplines and in support of the same objectives.
Just as with other direct marketing disciplines, email is used effectively to build profitable relationships; improve purchase frequency; enhance customer loyalty and satisfaction; reduce the cost of communications; build lifetime customer value; reduce customer acquisition costs; grow online sales and affect in-store buying behavior.
For example, in a DoubleClick-sponsored survey of 1000 consumers in October 2002, 68% of consumers were found to have purchased online as a result of receiving permission-based email. In addition, 59% have purchased in retail stores, 39% purchased through catalogs, 34% through call centers and 20% through postal mail. But that's not to say that e-mail should be used in isolation. In a more recent survey, which examined consumers' purchase behavior during the 2002 holiday season, DoubleClick found triple-channel buyers (catalog, retail and online) spent 68% more than single-channel shoppers this holiday season.
Many marketers that are already employing email as part of their mix are applying the learning and discipline from more established disciplines such as the direct mail and catalog industries. For example, marketers using email are not alone in needing to decide on a segmentation strategy, determining the most effective method to grow their house file or tracking sales generated per message delivered.
However, there are many issues that are specific to email marketing such as the need to receive permission from email recipients, the importance of a water-tight privacy policy, and for legitimate marketers in particular, the need to differentiate from SPAM (unsolicited promotional email).
Email marketers have also inherited measurement and analysis techniques from traditional marketers with most measuring RFM and LTV, for example. However, they also have additional metrics at their disposal such as open rates, click-through activity and abandoned conversions (those instances in which a customer has clicked on an email and gone through the purchasing process online, only to abandon the process at a certain stage). The most sophisticated marketers are measuring all of these metrics as well as analyzing the impact of communications in any single channel on activity that occurs across all channels.
For marketers that use email in the direct marketing mix, or are considering doing so, below are ten tips that can be immediately implemented to enhance the success of your campaigns.
1. Build/maintain consumer trust
When used responsibly, email is a powerful tool for communicating with customers, strengthening relationships and driving ongoing revenue. Sixty percent of consumers cite the 'from' line as their biggest motivator for opening email.
Tip: Marketers should seek to build trust over time by limiting the volume of email that they send, by providing relative and valuable content, by respecting consumers' email preferences and should always honor unsubscribes in a timely manner - usually within 24 hours.
2. Enable customization of email
Just as addressing a person by name in conversation usually generates a positive emotion, customizing email to recipients has the same effect. Eighty percent of consumers say that they have requested customization of their permission-based email. Of those 35% are more likely to make a purchase because of it.
Tip: Adding the recipient's name to an email, enabling them to customize the type of information and/or the layout of the emails they receive, not only enhances their feelings towards the sender, it also drives purchases.
3. Test for optimal customer-preferred frequency
There is no magic number of emails that a marketer should send. The optimal number varies depending on the reason for communicating - e.g. news might be sent daily, promotions might be sent weekly or monthly, and product updates might only be sent quarterly or even annually. Email inboxes are becoming more cluttered - the number of emails that the average consumer receives weekly, increased 60% to 254 messages between 2001 and 2002.
Tip: Test and analyze open rates, click through rates, pass along rates, conversion rates and unsubscribe rates to help determine the most appropriate frequency for emailing your customer base.
4: Set up a consumer preference center
In addition to analyzing consumer's response to email, marketers should also create preference centers to give consumers the opportunity to further customize the emails that they receive. Half of consumers (49%) now use an email program to automatically sort their email into a bulk or junk mail folder. Allowing consumers to customize the information that they receive helps to ensure messages make it to the recipient's inbox.
Tip: Marketers can provide consumers choices about content, layout, technology format and frequency of mailings, among other options.
5: Differentiate from SPAM
It is no surprise that unsolicited promotional email is consumers' number one concern about their email. Ninety percent of consumers cite SPAM as their biggest concern about email. The good news is that only 5% of consumers read SPAM to determine whether it is of interest (hopefully expediting its eradication). It is critical for legitimate marketers to differentiate themselves from SPAM to avoid being automatically deleted or placed in users' bulk mail folder.
Tip: Many marketers make it very clear at the beginning of an email how the consumer opted in to receive it. Others have tried tactics such as using their name in the subject line to emphasize to consumers which company it is from.
6: Test your subject line
The subject line is the second highest factor that compels consumers to open emails. News and information was the biggest driver for males, while discounts offers are the biggest drivers for females. Email affords a much greater level of analysis than any other form of direct mail by enabling marketers to determine which recipients actually opened and read their mail, who passed it along to friends, and, of course, who acted upon it.
Tip: Not only should email marketers tailor their subject line based on the gender, age, location and preferences of consumers, where these are known, it is also important to measure the responses to varying subject lines across the entire audience. There are also many phrases and words that should not be used - "Free" for example causes many ISPs SPAM filters to delete the message without delivering them to the addressee.
7: Use email for customer service
Email is consumers preferred method of communication with companies, and they expect to receive customer service emails, such as purchase confirmation and shipping details. Seventy eight percent of online shoppers have communicated with a customer service department by email and 57% of those prefer communicating by email, versus 38% that prefer phone service.
Tip: Marketers should consider automatic response emails as a highly cost-effective way to continue a dialog with a customer and emphasize the company's brand and messages.
8: Use customer service email as an upsell opportunity
Ninety eight percent of online shoppers expect to receive an order confirmation email. Eighty eight percent expect to receive shipping information and 77% expect to receive billing information. Although consumers expect to receive these email communications from marketers, these messages should not be considered an obligation. Rather, they are an opportunity for companies to upsell even more targeted offerings to existing customers.
Tip: Marketers should include offers in their customer service email, such as offer products that relate directly to purchases or inform customers what other products have been bought by people that bought the same product as them.
9: Track post-click conversion rates
One third (33%) of online shoppers have clicked on an email and made an immediate purchase. A slightly greater proportion (35%) have clicked on an email and made a purchase at a later time. Unless marketers are effectively tracking post-click conversion activity, they will be misattributing more than 50% of the email driven sales that they generate.
Tip: In order to accurately track the success of email marketing campaigns, marketers should work with technology providers that enable them to track not only click-through rates and purchases but also post-click conversions that occur at a later time.
10: Analyze the impact of email on multi-channel purchases
As a result of receiving permission-based email, 68% of consumers have purchased online, 59% have purchased in retail stores, 39% have purchased through catalogs, 34% through call centers and 20% through postal mail. In the 2002 holiday season, one third of multi-channel shoppers who purchased on the Internet input email promotional codes when shopping online.
Tip: Multi-channel marketers should implement methods of tracking sales to the actual marketing initiative that drove the sale. For example, marketers can track coupons and discount codes across channels. They can cross-tab mailing lists with buyer records, or they can use technology designed specifically for tracking multi-channel purchases. Marketers should even consider driving purchases or activity deliberately to other channels. For example email can be used to drive consumers to a store for an event occurring in the store, which may lead to incidental purchases.
These tips include some best practices for the format and delivery of email. There is less industry consensus on contact strategies within the overall marketing mix. Although it might be more effective for one company to send a catalog on a monthly basis and support it with weekly emails, this might prove ineffective for other companies, even those within the same industry vertical. Many companies are still formulating contact strategies and it appears that there is no 'cookie-cutter' solution to which medium, when, how often and in what order customers should be contacted. Multi-channel contact strategies should be identified through ongoing testing, on an individual organization basis, to find the optimal contact strategy for each company.
Methodology
The 2002 Consumer Email Study is the third in an annual series sponsored by DoubleClick and conducted by Beyond Interactive and Greenfield Online. One thousand consumers that use email at least once per week (statistically representative of 94% of the US online population) were polled in September 2002. The 2002 Holiday Shopping Study, also directed by Beyond Interactive and conducted by Greenfield Online, is based upon 1,000 respondents who were interviewed online between January 7 and January 12, 2003.
The Consumer Email Study is available at (http://www.doubleclick.com/knowledge) and an executive summary of the complete 2002 Holiday Shopping Study will be available at DoubleClick's Insight conference in March 2003 (http://www.doubleclick.com/insight).
About the author
Brian Rainey is President of Abacus, a division of DoubleClick Inc. In this role, he is responsible for overseeing the day-to-day operations of the Broomfield, Colorado-based division. Abacus manages the Abacus Alliance, the largest proprietary database of consumer, retail, business-to-business and online transactions used for target marketing purposes. Abacus combines the power of this shared data with its proprietary modeling techniques to help Alliance participants improve profitability and increase market share.
For more advertising and marketing help, news, resources and information visit our Home Page.
Back to top
|
|
|
