When Email Snafus Happen to Good Companies
Say it ain't so! I was actually sad when I read in MarketWatch this week that Seattle-based online retailer Zulily’s shares plunged more than 21 percent after it presented a weaker-than-expected sales forecast.
Not Zulily! Not the offbeat, quirky, flash-sales website that caters to mothers with products like clothing, toys and home décor for themselves and their children. Not the site whose customers, in a recent Zulily survey, chose Neil Patrick Harris and his brood as the celebrity family they would most want to join trick or treating! And not the site where I bought my daughter Caroline her first pair of “funky” patterned tights when she was three years old (she's 11 now)!
But it was true — despite the fact that Zulily’s third quarter 2014 net sales increased 72 percent year-over-year; active customers grew to 4.5 million; total orders placed increased to 5.9 million; and net sales are expected to be between $391.3 million and $416.3 million in the next quarter.
So, what caused the hiccup? Some analysts attributed the disappointing sales outlook to Zulily’s need to maintain its reputation as a provider of premium-branded merchandise at a time when retailers often slash prices or cut deals in hopes of attracting bigger-volume sales in the busy fourth-quarter holiday period.
According to a recent GeekWire article, the lower sales forecast was in part due to the fact that Zulily couldn't send out its daily email blasts to some of its customers this quarter due to issues with its email provider. This is a big problem, as you can imagine, for a flash-sale site that depends almost entirely on email to generate sales.
In a conference call with analysts, according to the GeekWire article, Zulily Chairman Mark Vadon said one of the larger email providers changed some settings, which meant “a lot of our emails weren't being delivered for a period of time.
“As that was happening, it didn’t seem like a good idea to push harder on marketing because effectively we’d be getting new email addresses, and some of them we wouldn’t be able to mail. So we held back a little bit on marketing,” said Vadon, who didn't say how many customers were impacted.
Earlier in the call, Zulily CEO Darrell Cavens said that the company has experienced email issues on occasion over the years, but it's “always been able to work through issues as they come up.” The most recent issues are largely resolved, Cavens said. But he added that the company does expect to see an occasional impact “from time to time.”
So, what can retailers do to ensure they're not faced with these types of issues? I asked Jim Davidson, a great contact of mine who is the director of research at email marking firm Bronto Software, if he had any advice or best practices he could give our readers around email deliverability. He offered up the following:
1. Review email acquisition points and CAN-SPAM compliancy. Ensure all email acquisition points set an expectation with the consumer that they will receive promotional emails. Revisit existing email forms to confirm that a new user would understand that they're opting in for ongoing marketing messages. Additionally, review your email program to ensure CAN-SPAM compliancy. Small details like including a postal address can be overlooked as email templates change.
2. Dissolve the dead weight. Identify subscribers who are no longer opening or clicking on your emails. These subscribers may still be actively purchasing in other channels so it may not make sense to remove these dormant subscribers from your list. Attempt to re-engage these segments and then drop the dead weight — i.e., consumers who could be more likely to take the lazy man’s opt-out and report your message as spam.
3. Talk to an expert. Your email service provider should have a person who is dedicated to deliverability. This person should be an expert in retailer-to-ISP relationships and able to identify any existing issues that need to be resolved or help out when you're in a deliverability jam. Having a periodic evaluation of your email program by this "guru" could help to ensure you're in line with the ISP’s expectations.