Email Program Optimization

	5 Easy Ways to Win with Email By Barry Stamos, Senior Director of Strategy, Responsys

Billions of people are now communicating at home and at work via email in an explosion of connectivity that threatens to undermine the established relationships of businesses in many sectors of the economy.

Executive endorsements for email marketing continue to spread like wildfire with budgets being re-evaluated, and then re-allocated, to include a more balanced online and offline marketing mix. The result is an integrated multi-channel marketing program that is faster, more effective, personalized, automated, measurable and, most importantly, profitable.

The Direct Marketing Association published an economic-impact study which stated, "The ROI for email marketing was $57.25 for every dollar spent. The ROI of all non-email-related online marketing was $22.52, less than half. And yet marketers only spent around $300 million on email marketing efforts, compared to $12 billion for non-email-related marketing -- $12 billion to get a return that is less than half of what can be achieved in email."

Still, regardless of how much is being spent, companies worldwide are tapping into the significant top- and bottom-line revenues. For example, the average ecommerce business today can expect to generate 10-30 percent of annual sales revenue from its email marketing program. For a large retailer that is $25-35 million per year.
However, many savvy marketers are still barely realizing their ROI potential from the email channel. In fact, most organizations entrenched in their own business affairs often lose sight of prime areas where they can save significant time and money using the email channel.

Having consulted hundreds of Fortune 500 companies over the past 10 years, I've realized the need busy marketers like yourself have for identifying timely actions to reduce spending and maximize earnings. Because you have limited time, money and resources, you must know where to focus your attention. Like so many others, you want proven solutions to safely apply industry best practices and dramatically improve marketing spending effectiveness.

Good news! I have your short list of top five quick wins!

What's the value of an email address to your organization?

For most companies, an email is worth between $5 and $50, especially when you account for channel-cost savings and incremental revenue realized through lifetime customer value. Your master email contact database is an extremely valuable corporate asset, often valued between $100,000 and $5 million or more! This is why today's market leaders are consistently growing their email lists 20 percent or more year-over-year. These smart marketers are leveraging every touch point as an opportunity to ask for permission to email. It's a land grab for permission to communicate via email with prospects and customers. Just look around and you'll find that more and more businesses are asking for your email address: websites, in-store, customer service representatives, events, tradeshows, etc. And remember, a quality opt-in email address may not only mean a new sale; if properly managed, it also means the beginning of a lifelong business relationship. It's that simple. It's that important.

How will you rapidly accelerate the quality and quantity of your email list size?

1. Website: Start by adding the ability to join your email mailing list on all existing data capture forms on your website. For a best-in-class example, go to Wine Enthusiast to see how a simple, quick sign-up form on the footer of every page on their website has boosted results.
2. Landing pages: Odds are your company spends two to three times more money than it should on media budgets to generate traffic to landing pages for lead capture. Focus your attention on improving the performance of your landing pages by testing incentives to join your email database. Then, engage these newbies in a lead nurture program to convert more leads to sales. Keep an eye on Harley-Davidson as it is driving paid search traffic from keyword buys directly to custom landing pages with sign-up forms for email follow-up.
3. Master contacts database: For most organizations, their email list is merely 30-40 percent of their postal mail contact database. Narrow this gap by cross-pollinating your other channel communications to promote the benefits of joining your email program.
4. Transactional emails: On all transactional emails, offer your customers the opportunity to join your email list to receive marketing-related emails. Be sure to include a business rule to only display this offer if the recipient is not already on record as having opted-in to receive marketing-related emails. For a best-in-class example, check out Allstate.
5. Customer service call center: Be sure everyone who deals with customers in your organization supports the shared goal of opt-in email list building. Train call center personnel and test scripts to increase acceptance rates when proposing email sign-up during transactional customer interactions. Companies excelling in this area realize take rates for email sign-up of 60-70 percent. For a best-in-class example, purchase a product online from Fingerhut.
6. In-store: Take advantage of all store traffic by including a display or kiosk to capture email opt-ins. For a best-in-class example, visit a Hertzberg Diamonds store and take note of how effective it is with presenting you with a compelling reason to stay in touch via email.
7. Referral programs: Consider launching a sweepstakes with a referral form to use viral marketing to exponentially grow the size of your addressable email contact database. Virgin America, which was just approved to fly in the U.S., ran an award-winning "name the plane" contest to generate buzz and build a sizeable opt-in contact database for future email promotions.
8. Events or tradeshows: For you B2B marketers, email capture at events and tradeshows should be one of your highest priorities. Make sure you are not buying emails by offering incentives or giveaways that have nothing to do with the nature of your business as this results in poor quality leads. Instead, offer to send interested attendees an email with a link to something they will value.
   

The mandate for today's marketers is clear: Get people to take action... now! However, around the world, marketers are struggling to connect with a customer base that is more sophisticated, more demanding and increasingly difficult to reach.

A search on Google for the word "boring" returns 67 million results; "interesting," on the other hand, returns 413 million results. The world prefers interesting.

The point is that the science of marketing has not changed. Give customers what they want, when they want it. However, many struggle in tackling the demand side of our addressable markets. Fortunately, recent technological advances in CRM and email allow cheaper, better and faster interactions with customers and prospects in wired locations worldwide.

Yet, many companies use email the same way they use postal mailers. And fortunately for them, it's almost impossible to lose money sending commercial email campaigns. The cost of deployment is less than one percent of revenue and advanced email technology solutions, like my company Responsys, make program management rather easy.

And therein lies the rub. The relatively high cost of traditional direct mail campaigns ensures that few campaigns go out the door without rigorous data selection, offer selection, creative development and testing. The low cost of email marketing makes for a more cavalier approach, usually resulting in the wrong message to the wrong person at the wrong time. These are the economics and tactics of spam. And legitimate opt-in email messages are increasingly being classified as spam if they are viewed as too frequent or irrelevant.

For every 100 emails, it is "normal" for 60-70 recipients to ignore you!

Consider the following scenario: 100 emails sent

Worse than being classified as a spammer -- or being unsubscribed from -- is being ignored. In a recent analysis of an insurance company's email file (of more than 200,000 subscribers) over 90 percent had not opened or clicked on an email in the last 12 months. This company had "burned" their list with a long-term, low-relevance messaging strategy. If it cost them $5 to acquire an email address -- and each was worth an average $10 in revenue per annum -- this was a $3 million marketing mistake.

The key to not burning your list is to match your content and offers to the needs, wants and desires of your subscribers, thus making your messages more interesting. To do so, the primary focus for an email marketer should be on capturing and integrating data that will help to make communications more relevant. Only then is it possible to prioritize what content to send subscribers and when.

Are your email sign-up forms designed to appeal to your audience? Is the email profile or preference center simple to fill out? Have you limited questions and fields for progressive profiling to a minimum? Most organizations fail to gain access to desired constituent data because they don't know how to position offers and architect smooth end-user experiences. The result is a lost opportunity to gather business intelligence.

When it comes to managing a list, choose quality over quantity. If there is a single metric that you know qualifies prospects, then use that metric. You don't want to waste time and money sending irrelevant information. The key to successful data capture is to know what to ask, and how and when to do so. Simple changes in your practices can often result in 20 percent increases in results -- and we all know that results are what count.

According to my trusted colleague John Nugent, vice president and general manager of Europe, Middle East, Africa for Responsys, the first steps to getting started are critical and often the most challenging. I concur. So, to increase your open, clickthrough, conversion and retention rates here's a simple two-step content strategy to follow:

1. Classify and standardize your content taxonomy across all channels (e.g., category/sub-category/product) and the latency of each product or service.
2. Prioritize the selection and timing of your email content as follows:

• Expressed preferences (preference centers, questionnaires, past purchases)
• Implied preferences (subject opens, subject clicked, web pages viewed)
• Cross-sell/up-sell rules (collaborative filtering, affinity products, latency)
• Traditional segmentation criteria (age, gender, geography, psychographics)
• No segmentation criteria (unknown subscribers, unique new products)
  

All too often I hear from marketers the following statement, "My bounce rate was 4 percent, so my deliverability rate was 96 percent, right?" Answer: Wrong! Consider the number of emails that were indeed delivered but went directly to the spam folder or a corporate firewall holding tank. You don't see these delivery occurrences in your automated email campaign reports, but they are in fact occurring every time you send an email campaign.

Just because you are using a reputable email service provider to deploy your email campaigns does not guarantee the delivery of your emails to the inbox of prospects and customers. What can you do? Use third-party deliverability firms like Pivotal Veracity to regularly monitor deliverability of your email campaigns. It's critical that you gain visibility into your true deliverability rates so that you have advance notice to resolve discrepancies in a timely manner. Sending emails these days without using a deliverability monitoring tool like Pivotal Veracity's PVIQ is like speeding down the highway without a radar detector. Not smart.

Use the above waterfall analysis to quickly demonstrate how significantly email deliverability failures adversely impact clicks and conversions. Doing so will help you gain immediate attention from C-level executives and, ultimately, support for time, money and resources to resolve outstanding issues. They, like you, don't like leaving money on the table.

In addition to working with a third-party, you can also empower your email audience to help you help them by providing clear instructions on how they can add your sending ID (email address) to their "safe sender" email address book. This assures you relatively safe passage to their inbox.

Ideally, you will develop a formal plan to step up customer communication around "safe-listing." Of course, timing is everything in marketing, so don't delay -- get in action today. Start by providing clear instructions and support to customers opting-in for email communications. Include a prominent call-to-action via an "add to safe sender list" direct response button or textual links on all email sign-up confirmation pages and welcome emails. Support the call-to-action with a landing page that provides ISP instructions to help subscribers complete the process. This is quintessential, as the average consumer does not know how to do this on their own. Your email service provider should have private-label pages you can use for this project. For a best-in-class example, see Allstate's email confirmation thank you page below.

 
Hungry for more best practices? For additional tips to maximize your email deliverability, scan a recent iMedia article written by Kirill Popov, titled, "Don't Get Shut Out of the Customers Inbox."

Haven't we all learned over the years the importance and value of real estate? Well then consider your email preview pane to be no different than waterfront property. The above-the-fold mark in email is typically between 300 and 500 pixels. You want to optimize the use of this space for your audience as, on average, less than 50 percent of your email recipients will scroll below-the-fold.

The first step in optimizing the preview pane experience is to address image blocking. Consider that the majority of your email recipients are reading emails at work. And, therefore, more than 50 percent on average are using Microsoft Outlook. Next, consider that the majority of companies using this email client have the default setting to not show images in emails. This means if you are using mostly images in your emails, then their preview pane experience is extremely poor.

A best practice is to make sure that your emails have a healthy balance of 50 percent images and 50 percent text. Doing so will enable your email recipients to still have a positive end-user experience regardless of image blocking. Always verify that your primary message and call-to-action renders successfully across all major email clients, and check all links. For a best-in-class example, see the Southwest Vacations emails below.

  
Additionally, be sure to include pre-header text that includes your primary offer with a textual call-to-action link above the HTML email template. For example, in the above email, Southwest Vacations has included text that reads, "Barry, Don't miss out! We've got 5 great vacation deals for you to choose from! > Check them out." (Note the call-to-action link.) It has also leveraged the header successfully to include a promotional box on the right side that displays text regardless of image rendering, so its call-to-action always appears.

Consider that a growing six percent of email recipients are now reading and sending emails from mobile devices. Regardless of whether I'm receiving Southwest's email on my iPhone, Blackberry or Treo, or if I'm viewing it on Microsoft Outlook's horizontal preview pane (as shown in screen shot below), the pre-header text is the first thing I read or notice on the email.

 
The key is to make sure you always include your brand or company name, the primary call-to-action and a clickable textual link to optimize the preview pane experience.

Ask any successful veteran direct marketer and they will talk your ear off about how testing is one of the most important disciplines. Ask any email marketer how often they test more than subject lines and they will tell you that they rarely have the time. Worse, many marketers are not doing any testing or have not established clean control groups to evaluate what is working or not working. In turn, most marketers are relying on gut-driven subjective decisions (opinions) instead of objective (data-driven) enhancements.

Stop gambling with your email program profitability. Test, test, test to get smart about what works and what doesn't -- and remember, you are never completely "done." As I shared in a past article, titled, "10 Quick Wins for Email Marketing," what worked well for you last year might not work now. Testing should be done daily and sustained by incorporating key fundamental practices into your standard email operating procedures or processes.

Below are five focus areas to help you get started today:

1. Choose a winner (lift revenues): Start by focusing your test efforts on an email campaign or program that is most likely to result in significant lifts in revenues. Often it's best to start testing on the emails that are making you the most money or are reaching the highest volume of customers. Said simply, focus your limited attention on what will have a big impact.
2. Find a control (past performance): Before engaging in any test efforts, be sure to document your current metrics to establish a baseline to improve upon. Additionally, always include a randomized hold-out group by isolating a small percent of your list size that will be not be affected by any items you are testing (i.e., control group). This will allow you to clearly prove the increase resulting from your test efforts and will come in handy when recognizing accomplishments (e.g., when discussing why you need more head count to test more often or your future promotion).
3. Create a test plan (one-off versus a program): All too often marketers get on a testing kick where they will get motivated and engage in A/B split testing for a few weeks and feel as though they have "tested." This is no different from a Southbeach diet when you lose a few pounds and start feeling good only to gain it back again months later. Testing, like eating healthy, needs to be part of a daily routine, and a formal test plan will help you stick with the program.
4. Start with subject lines (every email): All marketers should be doing A/B subject line testing in every email campaign. However, most emails that get out the door fail to include even a simple A/B split test. This is simply unacceptable, especially when considering that subject line testing alone can result in up to 50-60 percent clickthrough rate increases. Why? Because an email that doesn't get the attention of your customers gets deleted. Start A/B split test for subject lines on a small subset of your total addressable market; then roll out to larger segments within 24 hours.
5. Analyze results (winning factors/variations): It's surprising that so many RFPs for email software always include the importance of reporting capabilities. Yet, after signing on board with your email service provider, few marketers spend more then 10 hours per month logging in to use basic or advanced reporting functions to gain insights on what is and is not working. Though technology does the heavy lifting, a marketer's expertise is essential to analyze, architect, implement and continually refine one-to-one marketing programs. These days you must do your homework to pinpoint and address the points of failure that are causing leaks in your sales funnel conversion pathway. No one said it would be easy. If it were, everyone would be doing it. However, the companies that are investing in this area are getting smarter and smarter everyday. If you don't get in action soon, know that your competitors are or soon will.

This is your wake up call! The time to execute and advance the sophistication of your test efforts is now. While the majority of marketers are still stumbling with infrequent or poorly executed A/B split test efforts, the advanced marketers are light years ahead. They are using advanced test methods like multi-variant testing to rapidly accelerate their insights on how to optimize KPIs and email performance metrics. From my 10 years of email marketing, I can't disclose much in this area due to client confidentiality agreements. However, I will say that herein is your answer to "cracking the code" for accurately forecasting and meeting or exceeding your numbers each year. For a best-in-class example of advance testing, see the Senerata Flowers example below.

As you can see there are plenty of low-hanging fruit ready for harvesting -- simply adhere to this list. Engage in a healthy discussion with your in-house team, agency and email service provider to prioritize which of the aforementioned quick wins are right for you. Make one or all of them a reality to secure quick wins this year.