Get relevant via segmentation
The mandate for today's marketers is clear: Get people to take action... now! However, around the world, marketers are struggling to connect with a customer base that is more sophisticated, more demanding and increasingly difficult to reach.
A search on Google for the word "boring" returns 67 million results; "interesting," on the other hand, returns 413 million results. The world prefers interesting.
The point is that the science of marketing has not changed. Give customers what they want, when they want it. However, many struggle in tackling the demand side of our addressable markets. Fortunately, recent technological advances in CRM and email allow cheaper, better and faster interactions with customers and prospects in wired locations worldwide.
Yet, many companies use email the same way they use postal mailers. And fortunately for them, it's almost impossible to lose money sending commercial email campaigns. The cost of deployment is less than one percent of revenue and advanced email technology solutions, like my company Responsys, make program management rather easy.
And therein lies the rub. The relatively high cost of traditional direct mail campaigns ensures that few campaigns go out the door without rigorous data selection, offer selection, creative development and testing. The low cost of email marketing makes for a more cavalier approach, usually resulting in the wrong message to the wrong person at the wrong time. These are the economics and tactics of spam. And legitimate opt-in email messages are increasingly being classified as spam if they are viewed as too frequent or irrelevant.
For every 100 emails, it is "normal" for 60-70 recipients to ignore you!
Consider the following scenario: 100 emails sent
| Of the 100 emails sent |
Average rates
|
| 88 delivered |
Delivery rate 88%
|
| 26 opened |
Open rate 30%
|
| 11 clicked through |
Clickthrough rate 12%
|
| 1 converted |
Conversion rate 1.1% |
Worse than being classified as a spammer -- or being unsubscribed from -- is being ignored. In a recent analysis of an insurance company's email file (of more than 200,000 subscribers) over 90 percent had not opened or clicked on an email in the last 12 months. This company had "burned" their list with a long-term, low-relevance messaging strategy. If it cost them $5 to acquire an email address -- and each was worth an average $10 in revenue per annum -- this was a $3 million marketing mistake.
The key to not burning your list is to match your content and offers to the needs, wants and desires of your subscribers, thus making your messages more interesting. To do so, the primary focus for an email marketer should be on capturing and integrating data that will help to make communications more relevant. Only then is it possible to prioritize what content to send subscribers and when.
Are your email sign-up forms designed to appeal to your audience? Is the email profile or preference center simple to fill out? Have you limited questions and fields for progressive profiling to a minimum? Most organizations fail to gain access to desired constituent data because they don't know how to position offers and architect smooth end-user experiences. The result is a lost opportunity to gather business intelligence.
When it comes to managing a list, choose quality over quantity. If there is a single metric that you know qualifies prospects, then use that metric. You don't want to waste time and money sending irrelevant information. The key to successful data capture is to know what to ask, and how and when to do so. Simple changes in your practices can often result in 20 percent increases in results -- and we all know that results are what count.
According to my trusted colleague John Nugent, vice president and general manager of Europe, Middle East, Africa for Responsys, the first steps to getting started are critical and often the most challenging. I concur. So, to increase your open, clickthrough, conversion and retention rates here's a simple two-step content strategy to follow:
1. Classify and standardize your content taxonomy across all channels (e.g., category/sub-category/product) and the latency of each product or service.
2. Prioritize the selection and timing of your email content as follows:
- Expressed preferences (preference centers, questionnaires, past purchases)
- Implied preferences (subject opens, subject clicked, web pages viewed)
- Cross-sell/up-sell rules (collaborative filtering, affinity products, latency)
- Traditional segmentation criteria (age, gender, geography, psychographics)
- No segmentation criteria (unknown subscribers, unique new products)
