Value of an Email: Marketing’s Rosetta Stone, Part 2
Part one of this two-part series ran earlier this week.
Tune In or Get Tuned Out
With a boost in email addresses, marketers can really get smart about customers. I’ll go as far as to say existing customers should not be getting the regular email blast.
Make a plan, in this case for first-time buyers. What did they buy first, and where did they buy it? They’re likely to repeat what they did the first time. But if not, what's the new business opportunity? Don’t just throw spaghetti against the wall.
There's currently no visibility into those segments and their share of the customer portfolio. Marketers are just skimming the top with RFM, sending emails and catalogs to most recent buyers. They're just preaching to the choir.
If I buy high-quality sneakers, 16 months might be the right time to reach me for a repurchase campaign, but I’m out of the catalog pool because I haven’t bought recently enough. But the retailer has included me in email blasts from the very beginning. I have no interest in anything else, but I’m getting communications about all different kinds of shoes, for men and women. Chances are I’m not feeling too special and I’m tuning you out.
Value of an Email Communication: Super Householding
Using email addresses, marketers can make more profitable sense out of the "Super Householding" process — i.e., we sent a catalog to someone, but someone else used the code. How do we send the catalog to both now?
Super Household ID: The Buyer's Network
We know humans have a one-to-many relationship with emails, or even a many-to-many relationship. The same is true with credit cards; there are multiple people using any given credit card. To keep it all straight, we need to be able to look at the "buyer's network."
Beyond a traditional definition of a household, we’re not sure how all these people are related, but they're connected in a buyer’s network with an email address, a tokenized credit card or a mobile phone, as well as other IDs. Emails are key to letting us see the buyer's network.
We can know to send a book there because it influences multiple people. Then we can send an email to both addresses. The response nearly doubles when you connect to other people in a buyer's network. Then there are the customers who start as teens, not paying themselves, but become young adults. All these other alternatives need to be tracked.
This is all about customers that we could better understand and improve their customer experience to create incremental revenue. Knowing that just blasting messages was alienating them, we stayed the course to keep building incremental revenue this way.
Think Before You Blast
Many marketers are still blasting away, but it’s improving as these successes come to light and marketers consider how, at the end of the day, revenue comes from three different types of buyers:
- First-time buyers: “Welcome, we’re excited to see you.”
- Second-time buyers: Get customers over that second hurdle. Converting 15 percent of those one-time buyers is pretty good — each percentage point improvement equals millions of dollars. Now how do you stay relevant?
- Three-or-more-time buyers: You have enough data to reach them better. Stop treating them like everyone else. For a given retailer, 20 percent of their customers represent 40 percent to 60 percent of revenue. To not treat them differently is irresponsible. When nobody owns the customer in these distinct populations, the customer experience invariably breaks down.
The email identity system empowers retail marketers to stop blasting. Instead, with email as the “Rosetta Stone” of customer marketing, they can deliver targeted, personalized communications to get customers back again and again. They can identify and target lapsed customers and try to reactivate them. But faced with a siloed P&L that doesn’t recognize revenue per customer, very few take that route. Marketers that push past that barrier can capture a huge competitive advantage with stronger, more profitable customer relationships.
Related story: Value of an Email: Marketing’s Rosetta Stone, Part 1