It has never been more important for marketers to prove that their communications deliver a return on investment. But with so many people spending an increasing amount of time in front of a computer screen, both at work and at home, email marketing has the potential to reach more people than ever before. As a result, brands are turning to the medium to carry out direct marketing campaigns and generate more sales.
Yet those companies using email may not be getting the best out of their customer relationships. Just 10% of more than 2,000 consumers surveyed by email specialist e-Dialog and YouGov reported that a retailer had asked them for their email address after they placed an offline order.
The same data reveals that 63% of consumers would be prompted to make an impulse online purchase if they received an email from a brand. Those retailers failing to take down an email for their customers are missing the chance to add extra sales to their bottom lines.
Collecting and using this data is more important now than ever before. Marketers have to understand what motivates their current and potential customers and target them accordingly. But doing this remains a challenge when spam email continues to plague inboxes.
Simone Barratt, managing director of e-Dialog EMEA, explains that it is all about making sure consumers understand how their email address will be used and what benefits there are for them in handing it over. She says that highlighting “personalised offers, exclusive previews of products or extra loyalty points” is necessary to encourage people to hand over their details.
Ian Crocombe, a senior strategic planner at AKQA, agrees that there are issues with consumer trust, despite email’s reputation as the “workhorse” of the marketing industry. “Email has become a victim of its own success as it is cheap and easy to flood consumers’ inboxes with irrelevant messages,” he says.
“Consumers classify unwanted emails they have signed up for as spam. It’s easy to flag an item as junk from an email client and this action feeds back into filtering applications, making each of your future emails harder to deliver.”
One way of helping emails reach consumers and be relevant to them is to introduce good personalisation and behavioural targeting to all direct marketing emails.
Simon Bowker, UK managing director of email marketing agency eCircle, says this is critical. “Producing relevant emails will ensure customers don’t complain to their email providers and result in emails being blocked. Identifying different segments within your list, separating by stage of customer lifecycle and using personalisation has a huge effect on cut-through, in addition to setting automated campaigns using triggers based on events.”
Making sure consumers expect to receive emails can make a massive difference to how people perceive marketing emails. What appears to be an unsolicited mail-out that has escaped the spam filter can appear to be a juicy product offering if correctly targeted.
A survey of 4,000 people by email marketing provider Epsilon found that when emails were anticipated, 73% of consumers would click through to a website and 44% would watch video clips embedded in emails. Once at the website, 46% went on to make a purchase online.
Jon Maddison, sales and marketing director at Epsilon, says that rather than a short-term tool to blanket mail consumers, email can have a place in long-term strategies in the “whole customer lifecycle” if individuals can be “directly engaged”.
Epsilon’s survey also found that what compels people to open email marketing messages includes subject lines such as “Free Product Offer” and “Discount Offer”, which generate the maximum attention among recipients (62% and 55% respectively).
This has been key to the work undertaken by digital agencies such as Blue Barracuda which help produce mail-shots for brands including Pizza Hut Delivery Online and Nectar.
Martin Talks, chief executive of Blue Barracuda, says that email is very important as a customer relationship management tool as well as a promotional method. He says/ “It’s so important for brands to be seen to be looking after their clients in these times and email is providing endless opportunities for this level of engagement that customers want.”
He claims that since Blue Barracuda picked up the email marketing business for Pizza Hut two years ago, the fast food brand’s delivery arm has experienced a 14-fold increase in ROI on emails.
“It’s important to remember the total customer experience, not just email and vouchers. Therefore CRM is no longer just a model for managing customers but one of customer engagement . Satisfaction and loyalty are not really what count, advocacy is what makes the biggest difference,” says Talks.
Building this brand affinity is essential to maintaining the customer interest. Relevance and personalisation is key and should be first to be considered in any email campaign.
Marcel Cowan, director of the Cowan Group, explains: “Email converts can swamp their customers and prospects with generic or irrelevant messages. That’s where strategy comes in – every email you send must have a purpose and an objective – and you must learn something about the audience each time you send.”
Kathryn Dykeman, a director at Harris Interactive, adds that investing in proper CRM systems so that databases can be segmented effectively, linking sales data with attitudinal data, is vital. She says: “Motivated by an affinity for the brand, desire to provide their opinion and/or card rewards, customers enthusiastically respond when asked to participate.”
However, despite the need for careful segmentation, agencies advise against brands separating their email marketing strategy from their offline ads. Stuart Johnston, managing director of Experian QAS, says that combining email follow-ups with offline marketing approaches can reap rewards for customers who are “very loyal and have provided their email address because they want to receive information from brands”.
Not everyone is so convinced, however. Mike Welsh, chief executive of agency Publicis Dialog, says that he sees more customers than ever opting out of receiving marketing communications. “If people are willing to hand over an email address, it’s for other reasons than being sold to.Call me cynical, but email has been so abused by carpet bombers that in my experience it is becoming less effective anyway. Stop selling and start engaging if you want to avoid the junk folder.”
The Direct Marketing Association (DMA) says that consumers don’t make a distinction between different arms of a brand’s operations so while they’re happy in general to receive communications from various parts of a brand – via email, TV ad or even a telesales call – it all needs to be consistent to show “best practice”.
Richard Gibson, chairman of the benchmarking hub of the DMA’s Email Marketing Council and Return Path’s channel relationship manager, adds that just because brands have access to consumer data, they must not get carried away.
“The Information Commissioner says that email marketers should only gather personal data if they’re going to use it. Information gathered should be adequate, relevant and not excessive,” he warns. Making sure personalisation stops short of too much information is the way to ensure that email communications will be welcome.
Email marketing is offering brands seeking a real-time communication with their customers a new cost-effective direct tool to embrace. Used correctly, it could help to boost sales at a time when the high street is suffering, but only if it’s a resource that customers expect and anticipate.
Donna McNicholas, UK sales director for Lyris, sums up the challenge for those involved in using emails to communicate with consumers and potential customers: “If brands use email to communicate with their brand ambassadors then these personalised mail-outs will be successful.
“The key is to track and record every mailing, see what is going on and react in an appropriate manner. This could help ease marketing budget constraints, while simultaneously providing brands with a direct relationship with loyal and potential customers,” she says.
Case study Paramount Restaurant Group
Paramount Restaurant Group worked with email marketing specialist Pure to develop a voucher campaign. The email campaign, which ran from January to March this year, helped the group increase its online bookings by 150% over the last three months, across six restaurant brands that offer a variety of cuisines, such as traditional Italian food, modern seafood and classic French cuisine.
The group sent customers around the UK who ate at Chez Gérard, Brasserie Gérard, Bertorelli and Il Bertorelli, Caffé; Uno and Livebait voucher offers such as “two for one” or “£15 off” to encourage them to book a table.
The campaign used Pure’s email system PureResponse to provide customers subscribed to Paramount Restaurant Group’s database with the promotional vouchers.
One particular voucher campaign for Caffé; Uno, which started in January 2009, saw a 30% open rate, with a further 45% click-through rate. This resulted in 10,000 vouchers being downloaded. The campaign was originally sent to a mailing list of 79,000 customers.
Overall, traffic to the Paramount Restaurant Group’s websites increased by 307% across all brands in January 2009, against the previous month’s figures.
The group also saw its customer database expand by 70% between January and March this year; as a direct result of running online voucher campaigns, by allowing mailing list subscribers to forward promotional emails to friends and colleagues.
Ryan Badger, online marketing manager at Paramount Restaurant Group, reports that the campaign gave the company “freedom” and claims that “the total cost of the service for a year was covered with the delivery of our first email campaign.”
Anne Collet, marketing manager of Pure, adds that the key to the campaign’s success was the restaurant company choosing an email technique that fitted well with its target market. She says this type of “accountable marketing” is likely to do well in future.