[Image of: RetailWire Logo and Tagline (for print)]

BUSINESS TIPS

ChannelAdvisor:
Online Selling Strategies
RR Donnelley:
In-Store Marketing
LoyaltyOne:
Enriching Customer Relationships
 
[19 comments]

Are retailers missing opportunities to connect via e-mail?

March 5, 2014

Through a special arrangement, presented here for discussion is a summary of a current article from the LoyaltyTruth.com blog.

Over the years, if I did business with a brand or signed up for its loyalty program, I opted in for its e-mail stream. As a result, I now receive a ton of e-mails each week.

The problem: e-mail overload. So the other day I began to finally thin out my e-mail subscriptions. To stay on the "keep 'em coming" list, the company had to meet one of two criteria:

  • Did they recognize me as an individual?
  • Did the e-mails bring me value, offering relevant or interesting content?

What I saw were a lot of missed opportunities. Here are a few examples.

Staples. The main focus of their last e-mail was to "save 50% off cleaning and break room supplies," which might be relevant if I had a break room. What would have persuaded me to stay: some content aimed at me, the independent business person, that established Staples as a thought-leader in the small business space.

VERDICT: UNSUBSCRIBE

Avis. While they recognize me by name — "Thomas, Save With The Avis Corporate Awards Program" read one recent subject line — there is no other recognition of my past history with the company, including the fact that I haven't rented a car from Avis in well over a year. A "win-back" approach might have kept them in the mix.

VERDICT: UNSUBSCRIBE

Hilton. As a Hilton HHonors member, a regular stream of e-mails arrives enticing me to get deals on Hilton locations in San Francisco, Hawaii and even China. Why aren't they cities I visit? If they asked me which locations I'm most interested in, their communications could be personalized to my specific travel needs.

VERDICT: UNSUBSCRIBE

Booking.com. After recently looking for rooms in both Atlantic City and New York City, the travel site sent me an e-mail with an enticing message: "Last-minute deals for Atlantic City and New York City. Get them before they're gone!" They obviously "cookied" me the last time I was there, and I'm aware of the Big Brother aspect of this but their e-mail was tailored to my needs.

VERDICT: KEEP 'EM COMING

New York Mets. I have to commend my favorite baseball team for taking the initiative this past offseason and sending me an e-mail that linked to a long-survey designed to figure out who I am. It will be interesting to see how they use this info in the months ahead.

VERDICT: KEEP 'EM COMING

Patagonia. Sure, Patagonia is trying to sell me stuff, but their e-mails also link me to stories about exotic places, via adventurers who travel the world decked out in Patagonia gear. It's soft sell at its very best and it emotionally ties me to the brand. It also doesn't hurt that their clothing lasts forever.

VERDICT: KEEP 'EM COMING

FINANCIALS:     [NASDAQ:SPLS]

Discussion Questions:

Why are broad, deal-driven e-mail blasts still more common than personalized offers? Which types of e-mail campaigns connect with you and which send you to the "unsubscribe" link?

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

How much has the quality of e-mail marketing improved over the last five years?

Comments:

Great post Tom and coincidentally, I've been doing the same thing: opting-out of emails from many, many brands. The lack of personal, relevant communications via email are due to several factors, some easier to solve than others. Here are a few:

1) Lack of Integration. In many companies, retailers especially, there are still silos. Silos preclude integration across selling channels (e.g., store vs. online) as well as integration between loyalty and customer communications/CRM.

2) Data Challenges. A majority of companies still struggle to incorporate the right data for marketing communications. There's still lots of customer segmentation that's actionable for buying media ("targeting") versus communicating directly with customers.

3) Product-Centricity. Yes, most companies still focus on selling their products rather than figuring out what customers are likely to need/want/buy. Staples wants to sell break-room supplies as it's a "growth business" for them. So the category manager gets "slots" on the email calendar to blast away. Same with Hilton pushing destinations that are in shoulder periods like Hawaii and Vegas.

The examples here perfectly illustrate that even a well published loyalty program, such as Hilton HHonors, is only as good as the relationship marketing it either supports, or fails to support.

[Image of: View Braintrust Panelist button]
Phil Rubin, CEO, rDialogue

The key to email sustainability is relevance and customization. In the above article, the common theme of unsubscribe is the lack of utility. People stay subscribed to emails that offer utility. They unsubscribe from emails that offer none.

Broad, deal-driven email blasts are easy to do, appear to show activity, but have little impact. The key is to develop email metrics which provide understanding of email's value and design accordingly.

[Image of: View Braintrust Panelist button]
Richard J. George, Ph.D., Professor of Food Marketing, Haub School of Business, Saint Joseph's University

You love NY, airline prices are a pivotal driver. You love baseball, when the season is near, you get the bug. It seems you have less affinity for driving rental cars or cleaning windows.

Verdict: Love is the answer, and you know that for sure.

Vahe Katros, Consultant, Plan B

Personalized offers mean that a retailer has taken the time and undergone the expense to learn about you, the individual customer. That takes time and costs money, something most retailers would prefer not to do. They would rather try to lure the masses through a one size fits all discount. Unless their emails offer compelling discounts, or offer valuable content, I unsubscribe.

[Image of: View Braintrust Panelist button]
Max Goldberg, President, Max Goldberg & Associates

A friend sent me a spectacularly bad e-mail from Bloomingdale's last week. The title of the e-mail is "just for you" and it promotes a number of women's products (the recipient was a man). Like most other consumers, he didn't engage with the e-mail, but he also didn't unsubscribe.

Why does it happen? Because customer data is still heavily fragmented across multiple systems for most retailers, and is largely unavailable to retail e-mail practitioners in those organizations.

  • Customer data sits in e-commerce systems for the 3%-20% of shoppers that created an e-commerce account.
  • Customer data sits in loyalty systems for the < 10% of retailers that offer a loyalty program.
  • Customer data sits in CRM's systems for the < 5% of retailers that have a CRM system.
  • Anonymous customer data sits in the POS.
  • Customer data sits in vendors datastores for retailers that use third party basket analysis, social sign-on, segmentation, etc.

In most cases, the data is fragmented across multiple of the systems above. And that data is simply not integrated into the email service provider's system to be used for segmentation and targeting. Even when some of that data does exist in the ESP, few e-mail practitioners are given the resources and bandwidth to segment properly. Unfortunately, it's easier to blast a $5 off offer, than it is to get your customer data in order and create relevant segmented content.

And the sad truth is that, even when shoppers get inundated with non-relevant e-mails, they don't tend to unsubscribe, they just learn to filter out those e-mails. Even when a retailer turns its frequency up to daily sends (spray and pray), unsubscribe rates are tiny. So using unsubscribe rate as a metric for the success of your e-mail campaign and your content relevance is a huge mistake.

The good news is that the retailers that are sending relevant e-mails are getting wildly outsized returns. The very best e-mail practitioners are starting to move beyond segmented e-mails to completely one-to-one personalized e-mails, and even cooler, many of those personalizations happen when the e-mail is opened (not when it's sent).

E-mail is still one of the top 2-3 traffic generating activities for most e-commerce sites (and usually the most favorable ROI). It's crazy how many retailers haven't invested in being good at it.

[Image of: View Braintrust Panelist button]
Jason Goldberg, VP Commerce Strategy, Razorfish

Generic or untargeted emails are commonplace because marketers are not using their accrued interaction history to inform the messages. Or they are not capturing that data and have no analytic resources. Unfortunately, "more is better" still rules the day for most email marketing programs but it's not effective. "Deal-driven" email blasts are the norm because that's the state of most marketers' sophistication with respect to consumer communication.

It's a by-product of the transformation happening in retail today that is moving away from a product or basket view of marketing to one focused on the shopper experience. Price and expiring deals are vastly more simple to create and execute than understanding consumers as individuals and segmenting them for a targeted content marketing strategy. That's why data driven marketing is becoming a priority for many companies who know they are losing customers and destroying their brand by continuing to use email so haphazardly.

The problem is resolved by deploying the right combination of data, analytics and marketing applications, and then thinking more about how you engage consumers over time in virtual and in-store conversations. It's hard to do, but worthwhile and totally possible given what some leading marketers are already doing.

[Image of: View Braintrust Panelist button]
Gib Bassett, Global Program Director for Consumer Goods, Teradata Corp.

Email lists still remaining among the most efficient and cost effective ways to communicate with potential shoppers. Those that have been described by Tom Rapsas as candidates for "unsubscribing" either have not evolved to a level of targeting sophistication to offer relevant, customized content, and/or they still believe it to be a numbers game, knowing that even generic messages will find some new business, provided the numbers of email recipients are sufficient.

Personally, I subscribe to too much, but at least run through each message very quickly to asses it's value to me. Those that are personalized do get longer looks, but at the end of the day, if the email comes from a retailer or provider that I use, I will look at the message even if it is off the mark.

[Image of: View Braintrust Panelist button]
Mark Heckman, Principal, Mark Heckman Consulting

There's a persistent belief in retail that deals are more important than personalization. The twin sister of this belief is that frequency is good, to the point of sending an email every day. These practices not only cheapen the brand but also train customers to wait for sales.

It would take more effort to target purchasers of, say, boots, and let them know that new shipments of boots had arrived. But the results might speak for themselves. I'll be interested to see if other panelists also complain about frequency.

[Image of: View Braintrust Panelist button]
Cathy Hotka, Principal, Cathy Hotka & Associates

Even in this day and age, there are still millions of customers that pay no attention to social media, texting, and certainly newspapers, so e-mail is still a very effective way to reach out to customers because e-mail is for (almost) everyone. The issue here is that too much becomes counter-productive. Too many retailers are sending out so many e-mails that consumers immediately delete them without reading.

The best approach is to spread the e-mails out so that when they arrive in the customer's in-box, they still create intrigue and curiosity. It goes without saying that the subject lines need to be attention-grabbing, but without being over-stated, and the message needs to be easy to find, easy to read, and even easier to react to.

[Image of: View Braintrust Panelist button]
David Biernbaum, Senior Marketing and Business Development Consultant, David Biernbaum Associates LLC

I feel the need to share a recent experience and you can figure out how it relates here.

I have been judging a high school marketing competition for about 15 years. For those familiar, it is DECA and is an extra curricular marketing program offered in high schools across the country.

I always judge one of the entrepreneurial projects, which means that the students have come up with an idea, they do their marketing research, and put together plans to launch and market the business as well as financials. If you ever have the opportunity to judge one of these, go for it. The students are impressive and it certainly restores my faith in our future.

So why am I telling you this? Because in this year's judging, the largest number of entrants I have ever had, not one plan included email marketing!

These students are typically spot on with their outreach and very creative. I have gotten many ideas from them over the years and they no longer have any use for email marketing. They were all over Instagram, YouTube and social media. Pictures, pictures, pictures!

Retailers, if you want to stay ahead of the curve, I suggest you start thinking in pictures. They are the parables of our lives and they tell the story that tomorrow's generations what to read.

And that's my 2 cents!

Lee Kent, Brings Retail Executives Together to Meet.Learn.Profit, RetailConnections

This is a timely post since just last week I had to unsubscribe to the email blasts of two well respected and high-end retailers. I can fully understand why they want more of my business. After months of research, in the past few months I purchased expensive but very, very specific products I had been wanting related to cooking and entertaining from them. But multiple emails each and every week since then on other deals I have no interest in have sent me over the edge. An occasional email with a coupon code for some dollars off anything in their catalog or a limited time free shipping deal offer would be welcome and would probably often produce results. I think giving customers who opt in choices for the number, or kind of emails that would be acceptable to them would be a logical step in lieu of losing them completely.

I have similar issues with a travel company and a pet food purveyor but I haven't pulled the plug -- yet. I have not purchased dog food in over four years since the pooch died, but have bought plenty of cat food from them for the family felines. Please do not send me breathless specials on dog products. This morning's email announcing a webinar with information for a wonderful trip destination we already took with this firm last year is equally puzzling.

'Liatt'

This is an interesting post. One reason that broad email blasts may be more common is that retailers are trying to replicate or replace a vehicle that exists that has already been proven to drive traffic: the circular. That's actually a smart approach, in that anyone who engages in the newspaper insert is likely to have enough basic brand affinity to look at the email as well.

But surely Tom is right that there are opportunities to become much more personalized than that.

[Image of: View Braintrust Panelist button]
Jonathan Marek, Senior Vice President, Applied Predictive Technologies

Personalized offers are incredibly important, yet difficult to execute. It is far easier for companies to collect email addresses and send them mass mailings with promos available to everyone.

As email frequency and volume continues to increase, ones that are not relevant to my shopping behavior will quickly elicit an "unsubscribe" response from me. If I am clearly segmented and the message is targeted to me personally, I will keep the email alive.

[Image of: View Braintrust Panelist button]
Jesse Karp, Omnichannel Consulting Manager & Loyalty Practice Lead, Cognizant Business Consulting

Any retailer sending daily e-mails is just annoying their customer base. I don't need to hear from Staples daily, I know they are there. Someone came up with the concept of constant contact, meaning daily e-mails. This is just daily commercials and just like zipping past advertisements on my DVR, delete is the key of choice. These e-mails are not targeting me or my household. They are from the marketing school of throw it on the wall and see what sticks. Automatic routing to junk mail saves having to press the delete key.

[Image of: View Braintrust Panelist button]
W. Frank Dell II, CMC, President, Dellmart & Company

Deals get me to look. Big Lots sends out an awesome coupon that gets me 33% off of a $45 purchase. B&BW sends good coupons and so do a few others. I wouldn't eat at Ruby Tuesday's without the great coupons. The ones that irritate me are the ones that vary the coupon, like Dunhams. Don't send me a 15% off when last week I got a 25%. That makes me MAD!

Kate Blake, Social Media Manager, Take Five with Kate Blake

Why broad e-mail blasts common? They are because the marketing department can say they have an e-marketing strategy. If e-mails are flying and there is no way to measure results, their work is done. Right?

The thing is, that there are so many points of contact in the digital world and very little understanding of how to utilize them, manage them, and when to explore the new hot place to be. That takes a strategy. For most retailers, the strategy is throwing darts.

Rule #1: Never check the box that indicates you want to receive offers.

Rule #2: It doesn't matter, they send them anyway!

I've only placed one order as a result of any email and that has been from Zappos. Another retailer of car care supplies has great videos, but hasn't yet matched up products based on my previous purchases.

Every one I get I try to unsubscribe. That process is always interesting as well. It further drives me away from that retailer.

Blasts just indicate a strategy doesn't exist. It tells you a tremendous amount about the retailer. One specific software retailer that got less than a $25 purchase a year ago sends me an email daily even after unsubscribing. Think I'll be purchasing there again?

'Scanner'

I still believe that email marketing is viable. The open rate is less, but because of the low (or no) cost to deliver the message, it makes sense, even if a smaller percentage of them are opened. I'll speak from experience that if I like the store or am interested in a store's merchandise, I'll look it over before deleting. I play guitar, and enjoy getting promotional emails from Guitar Center. There are times that their frequency is too much, but I stay with them because I'm truly interested in their product.

Take advantage of the consumer that is truly interested in the store and its products. Ideally, a personalized email, even if it just based on prior buying experience, will outperform general blasts.

[Image of: View Braintrust Panelist button]
Shep Hyken, Chief Amazement Officer, Shepard Presentations, LLC

Excellent article, Tom.

I did the same thing at the start of the year. I went through my inbox and unsubscribed from newsletters with irrelevant and impersonal content.

Another factor I considered was email frequency. I opted out of several daily deal and flash sale subscriptions because I was receiving messages several times a week.

I do believe the batch and blast email strategy is on its way out. While there are still a ton of companies doing this, I think businesses are starting to realize that they need to send out tailored offers in order to engage with customers.

For instance, I know that The Honest Company sends welcome messages to their subscribers based on what they viewed on the site. So if I viewed say, baby products, I would probably get an email with images of diapers or wipes. But if I checked out cleaning products instead, then they'd send me messages about detergents or stain removers.

The key is to gather as much customer intel as possible. Like you said, retailers can accomplish this through surveys and cookies. We actually discussed this issue at length in an earlier blog post. Would love to get your thoughts!

Francesca Nicasio, Retail Blogger, Vend

I have just read through the 18 comments coming off my original post -- they read like a master's class in how to effectively use e-mail marketing. Thanks to all! Also, one side note -- the day after this story appeared here, I received a "we want you back" e-mail from Avis. Either they suddenly saw the light -- or at least one marketer there is a RetailWire reader.

Tom Rapsas, ACD, MRM/McCann

Search RetailWire
Follow Us...
[Image of:  Twitter Icon] [Image of:  Facebook Icon] [Image of:  LinkedIn Icon] [Image of:  RSS Icon]

RetailWire's
Getting Started video!

View this quick tutorial and learn all the essentials...

RetailWire Newsletters