E-mail Marketing: Exposures Tests Bear Sales Flashes
By incorporating an e-mail loyalty program, picture frame cataloger Exposures has enjoyed sales gains from its catalogs, an increase in order sizes, decreased variable operating expenses and increased total contribution, according to Vicki Updike, vice president of merchandising and marketing for Miles Kimball Co., the parent unit of Exposures, who spoke in a session at last week’s Internet Retailer Conference in San Jose, Calif.
She revealed the following results from the recent e-mail campaign:
* the e-mailed group had a total increase in sales of 18 percent greater than those who only receive the Exposures catalog;
* e-mail increased the number of overall orders by 6 percent;
* average order size increased 12 percent;
* variable operating cost per order decreased by 44 percent for online orders; and
* e-mails increased Exposures’ promotional costs by just 6 percent.
“You have to look at e-mail as part of a series of events to get customers to purchase,” she said.
Exposures took three e-mail strategies:
1. a total contact strategy
3. content-specific purposes
Exposures conducted e-mail marketing tests to understand incremental sales from catalog and e-mails. So, it mailed three different print catalogs to test with a control group, both with and without e-mails. From this, the cataloger measured increased sales and reduced costs from the use of e-mails.
For the test, Exposures randomly selected two test panels, all of whom had purchased online prior to 2006. All received three catalogs: Exposures’ winter, winter remail and spring books. The second panel also received three e-mail newsletters, two after the catalog arrived and one during the catalog mailing.
“The e-mail cannibalized 15 percent of catalog sales, while the overall sales increase of sales among those who received e-mails and the catalog vs. catalog-only was 18 percent,” Updike said. “But it’s more important for us to evaluate overall sales. In the end, we don’t care where the sales come from, e-mail or catalog.”
Within Exposures’ total contribution increase in e-mail (increase in sales and decrease in operating expense), it enjoyed a 43 percent increase in total contribution, a 35 percent increase in contribution per order and a 6 percent response increase.
As for Exposures’ e-mail reminder campaign, the cataloger sent a follow-up e-mail reminding customers of a targeted sale. Exposures mailed a postcard promoting a sale and a follow-up e-mail reminder of that sale.
The e-mailed group had a total sales gain of 11 percent over the postcard mailed on its own. E-mail increased the number of orders by 10 percent and e-mails increased Exposures’ promotional costs by just 3 percent.
Exposures’ content-specific e-mails increased its average order size by 14 percent, while total sales increased 5 percent for the targeted group. The end result was increased contribution.
“Our open rates have hovered around 30 percent; our conversion rates have been around 8 percent,” Updike said. “We’ve had a strong conversion rate and a loyal customer base. What’s more, e-mail subscribers spent 62 percent more than customers we don’t have an opt-in address for. E-mail subscribers made 50 percent more purchases than our total buyer file, on average.”
The company didn’t conduct any e-mail tests without a print catalog or postcard accompaniment, Updike pointed out, noting that Exposures feels it’s not ready for any e-mail-only campaigns yet.