May 14, 2017

But Email Marketing, That Helps, Right?

Here are our models from a few days ago.

Now one might think if we just use email marketing to push customers into stores, then things will be fine.

But what happens if the customer buys "right now" from the email marketing campaign?

Here's the story for a $200 retail-only buyer.
  • Call Center = $6.00
  • Online = $5.83
  • Email = $2.89
  • Search = $6.45
  • Retail = $77.64
Let's say that the customer becomes a $100 retail / $100 email buyer.
  • Call Center = $3.90
  • Online = $9.63
  • Email = $32.19
  • Search = $8.15
  • Retail = $43.34
This isn't much different than the online scenario - the act of a customer buying via email instead of retail transitions the customer toward a future that is skewed more toward direct-channel purchases than in-store purchases.

I know, I know, you think you are a magical marketer who can get the customer to buy something "extra". So what does it look like if the customer spends $200 in stores and $100 via email?
  • Call Center = $5.30
  • Online = $12.43
  • Email = $32.89
  • Search = $9.85
  • Retail = $78.04
If that happens, retail spend is essentially not impacted, but online spend increases.

But that's generally not how the world works. In general, the customer trades off between channels and doesn't increase spend across channels.

In my retail-centric projects, I repeatedly observe cases where hawking retail customers via email marketing ultimately yields an online purchase because of email marketing - and that purchase changes the trajectory of customer behavior moving forward. All of our "digital" efforts over the past fifteen years have had an impact - we've pushed the customer right out of stores. This is good for "digital" ... not as good for "retail". For "the customer", it's usually a wash.

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