A recent Twitter post by Smith-Harmon's Chad White, on behalf of The Retail Email Blog, raised the following point: Why does the email industry spend so much time on the basics? Because the basics of email marketing are complicated. This truism, in turn, begs the question: What's so tough about email marketing basics?
Developing and launching an email marketing program, particularly when working with legacy systems or brick-and-mortar operations, can be a Herculean effort. Juggling requirements for a weekly email full of dynamic content, legal requirements, customer support, rendering challenges, transactional messaging, and email capture processes (to list just a very few requirements) is not for the faint of heart. And email programs that go beyond the basics are few and far between. Why? Our efforts with marketers across industries, of varying sophistication with varied budgets, lead me to a few conclusions.
1. Unfortunately, good enough is totally acceptable
Most email marketers have been at it for a while. Open, click, and conversion rates are pretty well established within their organizations, especially among retailers. Every time they email, they make money. And it's practically free. Why change anything? Is a 5-10 percent lift worth the effort required for an effective reactivation effort? Do we really have to deliver a deeply discounted offer to jumpstart lapsed responders? Why redesign, test, and implement a more sophisticated welcome email or on-boarding program? Adding names and blasting them with promotional messages makes money.
Launching and maintaining a preference center can be daunting. What choices to offer? How to add new preferences? How to retire a choice in the future? How do I mail to opt-ins with preferences versus those without? Why should I customize emails for only a small percentage of the database? Every time we email, we make some money... so why add all this extra work? It's easy to understand why email marketers settle for what they have, particularly when compared to more-costly media like television.
Solution: Reduce waste. Next-gen email programs strive to reduce waste. They focus with laser precision on missed revenue opportunities like on-boarding, segmentation, preferences, and reactivation (among other customer marketing streams). If your KPIs aren't improving every month, you're standing still and getting behind. Inbox clutter can't be the only reason your response rates are in decline.
2. Enhancements beget more constraints on scarce resources
Frequently we find that clients' email or interactive marketing staffs are stretched so incredibly thin that even routine maintenance can be taxing. Executive management has been trained (by us, most likely) to expect that email should be wildly profitable, as high as a $45.06 return on the dollar. According to a Datran study, 55 percent of respondents said they expect ROI from email to be higher than any other channel. Clients who reinvest these profits and grow the email program are few and far between. Sometimes I wonder if these profits are funding underperformance of other marketing initiatives (like television?). Contrast these expectations with staffing challenges, and it's no wonder we settle for the status quo. Forrester found that almost half of interactive marketers struggle to prove ROI, but seven in 10 say they are understaffed to do so. That's a recipe for stasis if I've ever seen one.
Solution: Reinvest profits. Train your executive management to reinvest email profits. Self-funding is admirable, but growth and evolution are required. Urge them to add to staff, either at the client or via partner retainers. Leverage your ESP's expertise and invest in new types of campaigns, strategic guidance, segmentation strategies, and testing curricula.
3. Inaccessible data holds customer insights hostage
Designing, building, and supporting a next-gen email program gets significantly easier when analytics are applied. We encounter significant hurdles in securing access to data more frequently than I like to admit. An adequately performing email program that's run by skeletal staff creates a formula for status quo. Chasing down data from IT or another corporate silo just can't happen within such organizations. Most often clients rely on email response data instead of more-sophisticated data resources (not a bad thing, just not next-gen) to evolve their email programs. Opens, clicks, and link tracking can only take a program so far. Clients we've worked with who have linked analytics with outbound messaging realized 50 percent increases in conversion rates.
Solution: Unlock your customer data. If your email program realigns to reduce waste and executive management commits to providing the resources necessary to evolve the company's email initiative then run, don't walk, to get your data analytics up and running. And have a Holiday 2009 for the record books.
Conclusion
So what's an email marketer to do? How can we promote the change we need to see in our industry? On my more optimistic days, I dream I've rubbed the lamp and the Email Marketing Genie granted me one wish. In this fantasy, the industry uses transactional email response rates as our benchmark. When email is timely, relevant, and focused, magic can happen.
Every day, we're urging clients to set goals under which their promotional email will eventually perform like their transactional email. It takes time. It requires fortitude (and executive buy-in) of epic proportions. Promotional email may never wholly surpass their transactional messaging results, but it's certainly a better benchmark than the watered-down industry trend response "data" available on a simple Google search.
Chris Marriott is vice president and global managing director for Acxiom Digital.
