Most companies think that their email marketing revenue stems from their daily blast emails. They’re concerned that reducing frequency and targeting smaller audiences will impact their revenue negatively. Old habits die hard, but our segmentation research and experience validate the fact that segmentation and personalization have a dramatic positive effect on revenue.
When a group of customers is segmented and targeted by many small campaigns, the accumulated uplift is much higher in comparison to the results of a “spray and pray” campaign. As you cater to smaller and smaller segments, the average uplift you can expect to gain from your total customer base grows. In smaller groups, each customer will generate more uplift on average than if he or she were approached as a part of a larger group.
In addition, daily email blasts are notorious for chasing away customers. This is a no-brainer: no matter how loved a brand is, no one needs or wants to be on the receiving end of its daily communications. Customers will very soon either start ignoring your campaigns or opt out completely.
If your customers are accustomed to receiving daily emails, they are also less attentive to your offers: if every day brings a new offer, there is no sense of urgency or fear of missing out. Your customers will always prefer to wait it out for a better offer.
So, how to make the shift?
Test Your Email Blasts with a Control Group
To plan the steps to increase your email marketing revenue, first you need to measure the effect of your blast email campaigns. Common metrics such as CTR or open rates can be misleading, since they have no way of attributing revenue to the actual campaign. The only way to scientifically measure campaign impact is by allocating a control group for every campaign sent.
Comparing the results of the test group (customers who received the campaign) to those of the control group (customers who didn’t) will give you an accurate assessment of the effectiveness of your campaigns. You might be surprised to learn that revenue you’ve attributed to your blast emails can’t actually be attributed to your campaigns. Don’t be misled by the fact that you’re measuring a high open rate: you have to establish a connection between that metric and the business being conducted with you.
By using a control group to create a baseline measurement of your email blasts, you are ready for the next step: communicating with smaller segments and increasing your marketing revenue.
8 Steps to Targeted Customer Communications
Start slow. The goal here is not to throw your existing campaign strategy out the window and start from scratch. Excluding just one segment from your blast campaign and targeting it with meaningful content and offers is all it takes to set out on the road to segmentation.
Start with your new customers. Your new customers are yet to form an opinion about your campaigns, and are a great target group to make a fresh start with. Consider the journey your new customers make with you, and think about the brand persona you’d like to project. The best thing to do here is to put yourself in your new customers’ shoes. It stands to reason that after conducting your business with a new brand you wouldn’t expect to receive hard-sell daily emails, but rather a sequence that will include, perhaps, a thank you note, an email making sure that they are happy with their purchase, and only after that an offer for a similar product, a sale notification matching their preferences, further information about your offerings etc. Rather than aggressively trying to cash in on the first purchase, aim to build a meaningful relationship that really recognizes the needs of the other party.
Differentiate your content. Make sure that your designated content has a different look and feel compared with your regular blasts. A good idea is to use clean, aesthetic templates. Think reduced clutter: your customers are bombarded with literally hundreds of marketing messages daily. Make yours stand out by giving their eyes and minds a much needed break.
Measure and repeat. As stated above, the only way to figure out how this new strategy is working for you is to allocate a control group for your new campaign. As you repeat this campaign for new customers and data comes in, you’ll be able to assess the revenue your campaign is bringing in.
Like what you see? Keep going! Other great segments to target individually are reactivated customers (who are very similar to new), customers in risk of churn, and churned customers. While targeting that last segment, keep in mind that since these customers already churned, you are not giving any revenue away by taking them off your daily blasts (if that is still a concern).
Prioritize and exclude. If you’re happy with the results, you’ll want to designate additional tailored campaigns for other segments. Using prioritization and exclusion will ensure that you can do this while still using your daily blasts for the rest of your customers. Exclude the segments you’re now targeting individually from your blast customer coverage and prioritize their personalized campaigns. This strategy will guide you in slowly covering most of your data with personalized campaigns of a lower frequency, but a higher profitability.
Use multi-channel. As you gain confidence with contacting your customers segments individually, up your ante with multi-channel campaigns. These are more effective for your revenue as well as your brand presence.
Slowly cover your customer base with tailored campaigns. As you repeat the above steps for a growing number of segments, the number of customers receiving your daily blast will decrease substantially. Optimally, your daily blasts will start to function as a default bucket for the parts of your marketing plan still not covered by personalized campaigns. This is a good time to rethink the purpose of your blast email campaigns: they can be redesigned for special events appropriate for your complete customer base, such as Back to School, Valentine’s Day, Special Monthly Discount, etc.
Become an Email Marketing Expert!
If you implement this step-by-step approach to personalizing your campaigns for your customer targets, within weeks you will be able to graduate from an outdated daily blast email strategy into an emotionally intelligent segmentation strategy that will result in a measurable increase in revenue.
Varda is all about the customer. With more than 10 years helping customers improve their businesses by making the best use of their data, Varda is the perfect blend of energy and efficiency, equipped with a bright personality and exemplary professionalism. She holds a Bachelor’s degree in Economics and Business Administration.
