Retailers Can Use Record Email Growth and Engagement to Deliver Sales
After a year with no precedent, it’s important to use whatever new data arrives to chart a way forward. In our new Benchmarks report, Campaign Monitor looked at over 100 billion emails and found that 2020 showed remarkable growth across key email performance metrics, including total send volume, open rates and clickthrough rates. For retailers, email became a lifeline for customer communication, transaction and engagement, and customers responded at record numbers, opening a window of opportunity in 2021 for a new kind of relationship that's more data-informed across online and store channels.
Email was essential during 2020. Overall open rates were at 18 percent, after increasing by more than 13 percent year-over-year. Think about this huge jump another way — it's equivalent to 13 percent more people taking interest in the email message. A captive audience at home turned to email as a trustworthy channel for everything from transactions to content, promotions and deals. We actually saw a slight decline in the click-to-open rate at 14.1 percent. This is understandable as many customers’ mailboxes were flooded with additional COVID-19-related messages, with a main goal of informing rather than converting. The average clickthrough rate stayed fairly constant at 2.6 percent.
Retail also saw increases in engagement, albeit at lower levels than some other industry verticals. The retail open rate was 12.6 percent, which is 6 percentage points less than the average across all industries we looked at. This may seem counterintuitive, but while retailers are some of the most experienced email marketers, they're also dealing with heavy competition. Other industries, like health, finance and education, were also particularly vital for people in 2020, explaining extremely high interaction rates.
The retail clickthrough rate was 1.1 percent, which is also slightly lower than the average of 2.6 percent. The Retail click-to-open rate was 8.5 percent, which was almost six points lower than the average. One silver lining is that email provided retailers with an average unsubscribe rate of 0 percent. This number shows how retailers have been able to effectively reach their target audiences and keep them interested while also signing up enough new subscribers to balance out the average.
Email was a key staple for retaining customers during 2020, when so many retailer engagement plans had to be moved online. Of course, COVID-19 brought about many changes in 2020, only one of which is a dependency on digital communication. However, that was a big one for retailers. Online connection was far safer and easier amidst the pandemic, and targeted audiences enjoyed getting personalized newsletters with “Zoom outfits” and home improvement projects as much as they loved deals and sales. Marketers have had to adapt to these changes in behavior and focus more on their emails as a workhorse for many more elements of the customer relationship.
It appears that this trend towards a more digital age is here to stay. Ninety-one percent of customers we surveyed in our companion survey reported that email would continue to be vital in 2021. Marketers will continue to need to provide relevant content to their audiences to keep them interested, which should be easier in 2021 than it was last year. In 2020, marketers had to quickly shift their strategies, and 35 percent said their biggest challenge was creating new emails. Now, marketers will have the experience and hard-won insights from 2020 that allow them to optimize their email marketing strategy. This experience revealed information of what's most important in effective email marketing, like drag-and-drop editor (58 percent), personalization (38 percent), and segmentation (38 percent). Marketers will be able to use this information to grow in 2021.
One thing retailers should consider doing differently in 2021 is the timing of their emails. There's a lot of data showing how specific days of the week maintain more engagement. In 2020, Fridays had the highest open and clickthrough rates. Retailers should capitalize on this and strategically time their emails. Most importantly, they should continue to test the timing of their email sends to see what gets the best results from their audience.
2021 will provide retailers with new opportunities for growth. It will incorporate a combination of digital and in-store communications, which will require new approaches and the use of well-coordinated technologies and processes. Even as customers return to stores, the experience will be permanently changed. Retailers will need to keep subscribers engaged with email. They can do this by continuing to better their email practices by collecting and using more data, bringing in insights from store behavior, and developing artificial intelligence-driven personalized experiences.
Consumers will continue to rely on digital communication, like email. According to McKinsey & Co., online sales, which had climbed 14 percent over the past four years, grew by 25 percent over two weeks in March 2020. This change in behavior will not go away. Therefore, businesses must focus on expanding their online presence in a way that creates a unified experience with stores. As consumers go back to stores, retailers will need to make the necessary changes to keep safety at the forefront, while continuing to enhance their online connections.
Lane Harbin is the director of marketing at Campaign Monitor, a global technology company that provides an email marketing platform that’s easy to use yet extremely powerful.
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