Finding the Right Balance

We’ve talked a lot about building customer repositories and applying that logic to your marketing; and while this preference information is vital, it MUST be compared to the recipient’s actions and routinely validated throughout the lifecycle.

For instance, when I signed up for emails from an apparel company, they asked me about the dress code at my office. They collected my sizes and send a special email when something new is added to their line or placed on sale. Even though I don’t purchase from each email, I pay attention to them all and take the time to go through their print catalog.

From their perspective, they know that I specified business casual as my office dress code and that I wear a 15.5” shirt but they’ve seen that I only buy casual wear and the last two dress shirts purchased had a 16” neck. Armed with this knowledge, they can begin to incorporate a wider range of options into the specialty emails sent and/ or append my preferences.

A second example is from one of my financial institutions; they know that I have a single account type with them and that I’ve historically declined the offers from the telemarketers (they push one top-tier offer.) However, they also know that I regularly read articles on their lesser publicized services that are included in their newsletters. The newsletter articles are posted on their website and the newsletter recaps the week’s articles… yet I regularly read the articles on the site and then click through again from the weekly newsletter. I was impressed when one of their business development agents called specifically about two of the services I had recently read about, I can only assume he knew about my click throughs.

If your program or CRM isn’t equipped for this level of detail, there is a simple, yet effective way to help determine the right balance of a campaign… ask yourself if the recipient will find the message Relevant, Timely, Significant and if the medium is correct. Evaluating this balance and focusing on the recipient will help you to find the right balance for your program.

Five Star Customers

Segmentation Strategy is a pretty common theme among eMarketers; we’ve covered some simple strategies in other posts on the blog – buyers vs. non-buyers, leveraging preference data etc. We recently got a little insight from a marketing manager of an apparel company and his criteria to target buyers:

1) Recency – Check the time associated with the last order and when the recipient became a customer. Their strategy is to flag the person quickly for targeting with more personalized emails.

2) Frequency – Recipients who buy once are encouraged to quickly buy again; two-time buyers are pushed to three etc. Once the customer is over the five-time buyer mark they are put into a special category where the goal becomes creating a dialogue with this customer.

3) Average Order – They evaluate the total revenue and margin from the customer, the higher the values the higher their customer rating. Higher margin customers get five stars and are treated with a lot of respect and work hard to move the high revenue/ lower margin customers to higher margin products.

4) Geography – They realize that certain products don’t sell in certain climates or year-round so timing and geography become key factors. Geography also plays into their timing, they have seen an up-tick in sales from recipients shopping at work around 11:00AM and 3:00PM, so they release based on time zones to grab the multi-tasking worker.

5) Payment Method – Customers purchasing by check or PayPal are treated differently than those who pay by credit card (and not all credit cards are created equally.)

Just a few items to think about while developing the right mix for you to create interactive conversations with your customers…

True One to One

Segmentation can be as important as any other component of message development. While most segmentation requires some preference data there are others that can be leveraged if you’re just starting out or have limited information/ time:

• The Random A:B Split – Just divide the list, alter something and fire… see which message performs better.


• Tuesday/ Thursday Segment – Take the item above a little further; randomly split a fraction of the list and send on a particular day. Take the better performing message and deploy to the remainder of the list (and remember, it’s just a name, you don’t have to use Tuesday or multiple days…)

These strategies need some additional data, enhance your sign-up process to include preferences – this data forms the foundation for a lot of the personalization that is possible:

• Message Type – Divide based on those who want HTML, text or rich text messages; include a link to the other types, just so the recipient can see the available options.


• Timing – Release by time zone or, if possible, ask your user what time they would like to receive your alerts (morning, afternoon etc.)


• Source code Segmentation – Your recipients didn’t just appear, they signed up through an inquiry, purchase, directly from your website. They could have found you as the result of a search, perhaps a contest entry, partnership or append so leverage that information.

Alternatively, you could bypass the whole personal preferences and just base it on the recipient’s actions – and not just the buyer/ non-buyer segments.

• Operational Segmentation – Target people following the order process or an incomplete transaction; the same applies to your non-responders or inactive list.


• Transactional Segmentation – Your typical opens, clicks or responses can all be leveraged. Watch for multiples, repeated clicks on a certain section/ item can tell you a lot about a person… and help you generate future offers.


• First Responders – By tracking overall counts, you’ll quickly identify the first responders; acknowledge them and put them into their own group to receive advanced notice of your communiqués.

These suggestions don’t contemplate the added potential gained from survey data… so keep dividing your list and make the messages as personalized as possible.

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Just Do It!

We hear of so many suggestions, both practical and impractical, about how we can totally overhaul our email marketing program. You may have read some suggestions last week, but what we haven’t discussed is how to adopt these processes. While it is tough for us to make too many changes in one swoop, it is also equally hard to measure the success of change unless you do something dramatic – so today’s post is around how to find that balance.

Take your 2008 wish list or even simpler, take a couple of your 2007 campaigns. Pick ones that you liked that might not have been star performers, now overhaul them – the look, copy, call to action and landing page… make it stand out. Now take this revitalized (“NEW”) campaign and send it to three targeted segments:

1) Your First Responders: These are people who respond to your queries, your surveys and regularly provide you with feedback. These are people you may have written to, thanking them for their previous ideas. Let them in on the secret (sort of); sending them a simple note – tell them you truly need their feedback to improve your campaigns and your offers. Tell them you would like for them to receive a special set of emails each week, one “NEW” and one regular one, and that you would like to get their feedback on these campaigns – stress the importance.

2) Your Middle of the Road: These are the people who regularly open, sometimes click and occasionally convert. Target a random list of them with your “NEW” communiqués, keep this group small at first and grow the number of people you target as you are able to get more confident with your messaging. Don’t tell them what you’re doing, just watch.

3) Your Dead File: These are your non-responders, those you had lost all hope for. In addition to targeting them with the NEW creative you should even get a little bolder with your subject lines. If you can convert any one of these people it is a bonus.

Try this approach for updating in ’08; I’ve found that the ideas are always there, the biggest hold-up is the who we should target. Use this strategy to implement any new ideas you have – they don’t have to be from our eBucket Lists. Remember, successful email marketing is about creating a dialogue with your customers and prospects – so pick a group of people and just do it!

Boni (beau - nee)

As I grew up in India, I watched merchants treat their first customer of the day with a lot of respect. The first customer was thanked, even given a freebie, offered a cup of tea and in some cases if the customer asked for a special deal they often received it. The rationale for this exercise was to set the tone for the entire day. It was considered to be a bad omen if the first customer walked away without making a purchase so merchants were very careful to not let that happen, this practice is called Boni.

To apply this back to email, I would like to recommend the following:

• Activity/ Loyalty points: Award points for their purchases etc. the more points a prospect has should result in more opportunities/ better deals. Advertise this on your site and in your community so readers know what to expect and what will help them build elite customer status.


• First Responders: Let your top customers know about deals first, we should always make sure that our best customers are reassured they will be the first to receive information from you. A furniture company I am working with has taken this advice to heart and actually sends emails on behalf of their salespeople to their elite customers. Additionally they take the extra step of making their salespeople call these elite customers to remind them to check their inbox for that special offer.


• Quote ‘em: Ask your first group of buyers/ responders for a quote and leverage it. Publish their quote about why they are buying the product/ service on your landing page along with the date so others know it is current. This makes your site a lot more interactive, gives you additional authenticity and helps you refine your offer… most importantly you create a bond with your buyers.


• Follow a Pattern: Inform the customer about the order they just placed, ask them for feedback and leverage that feedback to get back to them promptly.


• Cross the Channel: Imagine the excitement you will create if a CSR tells your caller they were the first (or some number) phone order that day and were getting a special deal. More than exciting your customers, this will actually make your employees more enthusiastic about playing along.

What is interesting about this idea of Boni is that people always come back to the merchant they have purchased from – not necessarily the first thing in the morning, but at some point, because they have trust and an established relationship. The goal here is to build sustaining relationships as you create interactive conversations.

Divide & Conquer

I met Allen many years ago, online commerce had just dawned and as the man running marketing at my favorite apparel company I was fascinated by the way he would decorate his office; he would tear out pages of the catalog and write down numbers on each page – trying to have a bird’s eye view of the ROI. He knew his numbers, watching who was mailed and how often. His philosophy was simple – don't send everybody the same offer, don't mail them all at the time either. What was visionary about Allen was that while most email marketers were just plugging away campaigns targeting their lists with as many offers as possible, he insisted on trying to come up with segmentation strategy for list. His approach inspired me so I wanted to put forth ideas that would help you all with your segmentation.

• Message Type: From a technical perspective you can split your group into those who wants HTML, text, rich text or Web 2.0 content. The Web 2.0 content in email is emerging – Cosmopolitan Magazine does nice job; they put out text with links to a video, podcasts, images in addition to their regular content and links to their website. What is wise in this process is to keep a little tab at the bottom asking the reader if they would like to see what the other types of content look like.
  
• Timing: Timing is an important aspect as well. Stagger your emails by time zones and, if your technology allows, ask your user what time they would like to receive your alerts. A number of marketers are experimenting with sending people emails the same time they typically read them. The lesson to learn from this strategy is that this may not be as predictable.
  
• Operational Segmentation: It is good to target people right after the order process or even after an incomplete transaction. It is also useful to target people differently if they have not responded to your emails.
  
• Transactional Segmentation: Track how often people open, click or respond to your emails. Leverage this information into the emails you are sending them. You can build a repository of preferences based on their click throughs. The number of times they click on a column or an offer over time is also going to help you with the personalized offers you generate for them.
  
• Buyer/ non-buyer: This is a natural; make it better by breaking the non-buyers into those who have opened (once, twice or more), those who have clicked and those who have not opened. Same thing with buyers, split them into product areas as you try to coax them into other interests.
  
• Source-Code Segmentation: This is a good way to see where people came from and where you can lead them. People don't just sign up for email – they may have come from a variety of sources, from an inquiry, purchase, directly from your website. They could have found you as the result of a search, perhaps a contest entry, partnership, append or perhaps from “Brad” their representative (call center or branch).
  
• The “Brad” Segment: A number of companies perform micro-segmentation by targeting their customers or prospects through the various representatives that work for them. This keeps it personal; this approach can help you begin, establish a relationship and then move into your mainstream campaigns – it is a good way to open the door.
  
• The Betting Pool: This split is a way to get your employees involved, choose copy, creative or just subject lines and have people bet on the one that will do better – split the list and keep the excitement (involvement) going.
  
• Exclusive/ Top Dogs: Of course one of your strategies should be to move people from lower performing segments to higher performing segments. Take your first responders, let them know that they are part of this group and give them advance notice of the communiqué.
  
• Sniff and Pow: This is an interesting one, track what people do on your site, and then target them with offers that are specific to what they are looking at.
  
• Tuesday/ Thursday Segment: This is also useful; my friend Christine used to target her list with four versions on Tuesday and then target the entire list with the best performing email on Thursday. Of course, times have changed and now her Tuesday/ Thursday test is done within a few hours.

If all else fails there is always the A:B Random split – if you’re just starting out or have limited information/ time why not split the list into two groups to see which one performs better.

If you have limited data, improve your sign up process, ask your users about their preferences – simple preferences ranging from types of communiqués they would like to receive from you to more complex preferences of how they use your product/ service. This forms the foundation for a lot of the personalization that is possible.

How much should you charge?

Today’s post is about trying to figure out how much you could charge for a product or service. For that matter it is also about trying to figure out who you could target with a particular offer. I have successfully applied this principle at a number of places and would like to share with you an example with a travel company – hopefully you can draw from this some examples and try to apply them to your own business.

A travel company features destinations to their subscribers. They do it in two unique ways – first they simply list images of different destinations in their email campaigns. They also run a column & every week the author of the column shares her experience having visited a particular destination. They track the clicks on each city, plus they track who is reading the column. After three months of campaigns, they analyze their click throughs to gauge who is interested in which destination & who is reading the column. They pick the people and then set them up with a series of recurring multi-channel communiqués to coax them into the destination or even purchasing a travel guide. The pricing strategy for the travel guide is quite interesting. They track the clicks on their travel destination column & put people into different segments – those who are avid readers (above 7 clicks) get to pay full price for the guide; those who have read it a little less (more than 4 clicks) get a 15% discount; those who have read it two or three times get a 20% discount. And of course, one time readers get a special offer – they get a free online subscription to 3 months worth of destination columns. If they open and read these emails, they get the offer to purchase the entire set of travel guides for 40% off list.

This same principle could be applied to a financial institution. You feature an expert’s column where you share best financial practices. You track the clicks on this column and use the information to invite the readers to insider seminars or to purchase DVDs or books by the expert.

A cataloger that I work with does something very simple – yet it is so effective. They offer their buyers and non-buyers a simple survey. The survey asks the recipient what they like and even asks them to rank products & suggest price points. The cataloger then keeps this information handy and leverages it into specific offers.

It is all about knowing what people want, and engaging them in a dialogue.

Targeting Your Email by Age

When you work in marketing, you know you're getting old when you move into a new demographic.

In all seriousness, are you using age demographic information when marketing to your customers via email? If you're not, you should be. One retailer who I have purchased from in the past, and whose email list I am on, has been sending me emails twice a day each day since Thanksgiving. This tactic might work well for people in the 18 - 25 demographic, but I'm now almost in the middle of the 26 - 32 demographic (*sobs*). That much email is too much for me.

In addition, the content doesn't necessarily speak to me any differently as being someone in an older demographic. I might not be interested in the same kinds of jeans that all the other kids are wearing this fall, but a nice dress shirt that I can wear to the office would be more my speed.
If you have the age information of your customer base, consider segmenting these groups and seeing how they perform to things like frequency and time of day. Also, try to tailor your content to these different demographics so that you can present them with more relevant offers, and not make them feel old.