June 16, 2014

Online / Retail Dynamics: Email Marketing

The three most valuable segments are the upper-middle segment, the upper-right segment, and the middle-right segment.


What is the advertising channel that is common across each segment?

Email!

Email marketing is, in my opinion, the least understood of the advertising channels I work with. This happens, quite honestly, because the metrics associated with email marketing success (opens / clicks / conversions) are not aligned with the metrics that really matter (demand, profit).

For this business, there are common characteristics for email buyers.

  • More likely to browse than to buy (9.6 to 1, 6.5 to 1, and 5.3 to 1 visit/purchase odds).
  • Way more likely to visit the website than the average customer (54.45 visits, 73.57 visits, 30.59 visits, on an annual basis).
  • Likely to combine email marketing with another advertising channel.
This analysis brings two thoughts to mind.

  1. More than half of the purchases, among the email centric customer segments, happen in-store. This means that the standard open/click/conversion framework completely misses these purchases, and as a result, seriously miscalculates the effectiveness of email marketing.
  2. Email buyers tend to be browsers - they visit the site all the time - and therefore, do not need to be given "hard-sell" tactics. These customers, on average, are visiting the website once a week.
I see this outcome, often, among customers who buy from email campaigns. They visit frequently without buying. Conversion isn't the problem here - no - the problem is often a lack of a new message.

Your best customers visit the website all the time. Why bore them with website updates that happen monthly? Or every-other-week?

Some customer segments require a constant supply of new content. Segment your customers, and then give the customers who require new content a steady diet of new content! Stop boring customers!

Contact me (kevinh@minethatdata.com) for your own, customized Online / Retail Dynamics analysis.