This is a guest post by Matthew Neal of Out To Sea. Most marketers know that email marketing can deliver serious results if you know how to utilize it properly. Optimizing our clients email newsletters and triggered email strategy is a high priority at my agency Out To Sea. It is a fascinating aspect of digital marketing and for the retailers especially, it is a channel that needs to be firing on all cylinders if you are serious about generating revenue from your store.
It starts with an email database
When we work with clients to improve their email marketing, one of the most common challenges we face is how to get a greater understanding of their subscribers. Many businesses have been collecting email addresses for a long time, and many are collecting these addresses without a plan of what they are going to use them for. They are aware that they will want to send messaging in the future, but at the time of collection they didn’t know what data they should collect. Many didn’t collect anything other than the email address, or at best, when and where the email address was collected.
Data unlocks opportunity
Minimal data isn’t so much of a big issue if your business is focussed on a small group of similar products or a specific niche interest where you have no need to differentiate your messaging. It does start to become a problem though when you are marketing a wide range of products, or to an audience with a wide range of interests (often short term interests).
A practical example
We were asked to advise a well-known record label on how they could improve their email marketing strategy. They wanted to know how to acquire email addresses and what to send out to them. The label manages a wide ranging catalogue, and sell both physical and digital products. If you like music then they have something in their catalogue that will appeal to you. That means their potential audience is huge, but it is also an audience with differing music tastes. Blanket mass marketing to this audience is inefficient and will only have a negative effect.
Without targeting their messaging to musical tastes they run the risk of both delighting and alienating their audience at the same time. A fan of deep jazz like Sun Ra is not likely to engage with messaging about Rihanna for example, and vice versa. Music is the connecting medium, but within that there are very polarized tastes, and it is rare to find someone who doesn’t have taste preferences.
In a situation like this, without segmentation they are most likely to experience a slow, costly decline in email marketing effectiveness. Over time the recipients of their blanket emails will stop bothering to open what they are sent from the label. In an age of time and attention scarcity the risk of wasting time and attention on something that could be irrelevant to them is not worth the effort it takes to open it to find out if they were right.
The label will have a list with a high churn rate, and they will be missing out on the opportunity that is there for them to take. Recipients won’t give them many chances to redeem themselves, and if its pot luck if a mail resonates or not they are operating without a retention or win-back strategy in place. Worse still, they could be flagged as spam or be blocked by enough disgruntled recipients that they the majority of emails they send could be blanket blocked as spam – preventing even those who may have been into what they send from receiving them.
Segmentation is the solution and the challenge
It was clear that segmentation should be placed at the heart of their email marketing strategy. Segmentation ensures that the right messaging goes to the right person at the right time. This will greatly improve the efficiency and effectiveness of their email marketing, as well as giving them significantly greater up-sell and cross-sell results. Having explained the segmentation strategy, it was quite easy to put in place an approach for collecting email addresses with supporting data going-forward, but to get their existing list also maximizing opportunity they needed to enrich that email database. That was the only way they could begin to target these subscribers with relevant emails.
This is not uncommon, as many businesses have a large historic database of email addresses that they have collected over the years. They often have no way of knowing where the addresses where collected from and what the motivation was for that person to elect to receive further communications.
Data enrichment is essential to segmentation
When you have an email database with minimal data, or an email database that hasn’t been updated regularly, then there are a number of tactics you can utilize to enrich the data you have already collected.
Asking those people on the list to volunteer further information about themselves
Ask those people on the list to update their preferences in return for a reward. For example, a retailer could email their list and ask them to update their email preferences in relation to that retailer. In return the retailer will give them confidence that they will now only receive emails that focus on what they want to read about. As an added bonus the retailer could entice completion with a discount code that can be redeemed against a purchase with that retailer. If discounting isn’t their thing, they could offer a reward of free shipping when the subscriber next orders, exclusive access to content rewards, loyalty scheme points, or whatever else they think will trigger the desired response from those on their list.
Services such as Mailchimp make it easy to add a link in your emails that when clicked will send people to a preference form they can update. The forms can be customized and can be hosted on a variety of landing pages you control. When the list member updates their preferences this will be updated within Mailchimp too, and you can use this for segmentation. Some agencies recommend embedding the preference form into the email itself, but we have found that many email clients consider email forms to be a security risk. While some email clients simply warn you of potential danger, others outright disable the forms. Most recipients will never be able to use the form, and for those who can, they’ll think twice about submitting data when they see a warning from their email client.
Here is an example of Goodhood’s preference form. I accessed it via a link in the footer found in a recent email newsletter:
The success rate of this tactic depends on a number of factors, including, how many people on the list signed up via that form, how enticing the value exchange is, how interested the list are in your brand / products, how often you contact your list, and the type of audience you are targeting. Asking people to give you time and information is a big request, but it will also reveal a lot about your database. Even those that ignore your request will reveal valuable information about the health of your list. You may also find that after a subscriber has received a few newsletters focussed on their personal interests, they will be more open to further requests for additional data. Once people have experienced that there are benefits in sharing something about themselves, they are more likely to do so.
Integrate preference updates for emails into your site’s customer account management feature set. This works well if those people on your list have also registered as customers. This gives the customer control, and whilst the update preferences link should always be visible in the footer of your newsletter emails, having it as part of their account features will encourage its regular use. If management of email preferences becomes a habit, then you will have a pretty decent automated segmentation tool. You will never get all your registered accounts using this, but it is still useful. This is especially valuable to business whose offering is best suited to targeting with short-term data – trends in fashion, music taste, etc.
Here is how Mr Porter enable customer’s to enrich their data on the site:
And this is an example of a segmented email constructed from enrichment tactic. All of these products are new products from the brand’s that have been selected:
If you have email addresses that have been harvested from unknown forms / sources then you will have to work a bit harder. In the same way you can ask subscribers to update a preference form in return for a reward, you could also ask them to complete a short survey. You could use a tool such as Survey Monkey to handle this and that would allow you to customize the survey, host it on a landing page you feel is most suitable, and set whatever questions you want to be answered. Once competed you can manually add this data to your database.
Collecting data about your list without requesting their direct participation in the task
Using specialist data enrichment tools (such as Full Contact) you can collect publicly accessible data for some of the email addresses in your database. They are best suited for the collection of long term data – the kind of information that would never change or is least likely to change over a multi-year subscriber relationship, E.g. Gender, life-event triggers, name, location, etc. They can also access social network data that can include information such as the subscriber’s job, company information, social media followers, influence measures (Klout), etc.
These tools cost money to use, but you only pay what you match and in my experience you typically get a 20 – 60% hit rate depending on if it’s b2b or b2c. This is very useful for cleaning up a database, and enabling more personalized messaging, but it won’t help you collate short-term data as well as direct enrichment. I would usually apply this tactic as a starting point to clean up my data, and would then apply active enrichment tactics afterwards. It will enable greater personalization in your request for direct enrichment, which should help to increase the level of participation.
If you are using an email marketing supplier and have already been sending out emails to this list through that system, that means there is historical data to be mined. From this you can establish how active your list is, and through what they have opened and clicked you could get a better understanding of their preferences in the context of your offering. No questions are actually asked under this method and reader’s interests are gauged from previous behavior. The effectiveness of this method will be impacted by what you have sent in the past, what tracking you have set-up (you could analyze link clicks within an email as an example), and how much resource you have to perform the analysis of the data you have collected over the time.
It can be quite a task and is not always an accurate reflection of preference: just because someone happened to open an email does’t mean that the content inside was the trigger for the open. If they didn’t open an email or click on a link then that may also be simply cause they didn’t see it. There are many possible reasons, so be prepared to accept limitations. You will also need to establish what would be statistically reliable as a cue to segment from.
If you have an e-commerce offering and have e-commerce tracking set up with your email marketing provider then you can see who on your list has purchased from you in the past and what it is they have been purchasing. This is a common method for retailers to segment, but only applies to those on the list that have purchased from you. For most databases this is going to be a small segment of the total list. It will leave many gaps. Plus, from my experience of working with product recommendation tools, spotting trends and predicting purchase propensity from past behavior is a contentious subject.
As you can see, all is not lost if you have no supporting data with your email database. You can still apply a gradual & organized approach to getting your database filled. Even if you have collected data at the on-boarding stage you should still be managing your database going forward. Your list is not a static concept, but a dynamic environment that needs to be maintained. I usually recommend a combination of direct and indirect enrichment and getting the right mix for your list is the key to success. What is right for one brand is not right for another. Avoid collecting data for the sake of it, if its direct enrichment it will frustrate recipients no end if you don’t apply the data you have collected. The value of this activity is only realized when you can turn it into action. So be efficient in what you collect, and base this on what you intend to do with it going forward. Make sure you balance the effort of getting the data with the returns you predict having it will bring your business.
Author bio: Matthew Neale is a strategist with over 10 years digital marketing experience. He is a founder of Out To Sea, an agency that specialise in digital marketing, strategy and e-commerce for creative brands. You can contact Matthew here.
Feature image edited from Tim Van Damme