The Future of Email

The Future of EmailMarketing Guide

The Future of EmailThe way we communicate is constantly changing. Evolutions inmobile devices, social networking, gaming and generational shifts, among other factors, aredriving how we connect with each other and the brands we support. What’s more, theseinnovations are changing the power of email, increasing the impact email marketers canmake in the inbox. In this guide, we’ll cover eight trends that determine the future of email practices. We will provide examples of how brands are leveraging advances in communication to generate communities, brand advocacy and ROI.Specifically this guide will address: • Mobile communications, especially smartphones • Social media • The social inbox • Social currency • Shopper marketing • Location-based marketing • Millennials • Social gamingMarketing Guide 2

The Future of EmailTrend #1: Mobile Communications Rising FastThe buzz around mobile marketing is rising for good reason. How Faster networks and richer capabilities have catapulted themany times have you been waiting in line at the grocery store, number of mobile subscriptions throughout the world to over theriding the subway or sitting in a doctor’s office and conducted 5 billion mark.“mobile email triage” on your smartphone? Chances are it’s quite Mobile is today and tomorrow. In fact according to eMarketer,a bit. 73 percent of mobile users are interested in shopping from theirA study conducted by Nielsen reported that 45 percent of phone. Brands that want to stay relevant need a mobile strategyWeb mobile use is spent checking email. Combine that with and content to engage with their customers.the fact that there are 5 billion mobile devices worldwide, and The unique characteristics of mobile marketing makes it ayou’re looking at an enormous audience and a wide platform for notable channel where marketers are able to know just whereyour campaigns. their customers are and engage with them at any given point in US Mobile Social New Users, 2009-2015 time. Mobile allows marketers to stay relevant by showing up in the right place, on the right platform, at the right time, with an immediate, relevant offer. Designing for Smartphones Given the deep and growing penetration of smartphones in the market place, designing campaigns for mobile users is becoming essential. Plus, there’s more to smartphones than just email. They’re now one of the key ways we connect socially. There are an estimated 50 million mobile social network users in the U.S., and that number is forecasted to increase 60 percent by 2015. In short, mobile marketing is social media marketing. Carter’s Integrates Social and Mobile This is a very compelling offer for Integrating mobile with social doesn’t the Carter’s customers, yet costs the have to be complicated. company no more than accepting a printed coupon. It’s a great way to reach Carter’s, a Lyris customer, shows great your subscribers where they are – on mobile sensitivity by offering coupons the go. on Facebook that can be presented in stores from your phone – no need to print them before heading to the store.Marketing Guide 3

The Future of EmailTrend #2: Social Media “There are 750 million active users on Facebook, and the average user has It actually appears that social media use makes130 friends. When email is combined with social media, there’s significant people consume more email, not less, as we hadpotential for a “word of mouth” multiplier effect. This word of mouth “ originally assumed – particularly for the highestmultiplier can grow your list, increase your brand awareness and drive social media users.your promotions. John Gibs, VP Media Analytics, NielsenSocial media can also provide marketers with deeper customer insights,allowing for better engagement and improved messaging. According toJohn Gibs, vice president of Media Analytics at Nielsen, “It actually appears that social media use makes people consume more email,not less, as we originally assumed – particularly for the highest social media users.”The key is creating engaging content that users want to share with their networks.Developing Shareable ContentWhat makes content shareable? Certain types of content are innately “viral.” These types include: • Incentives and discounts such as sample products, discounts or free shipping • Events including grand openings, movie premieres and sweepstakes • Product reviews from other customers or industry experts • Insider information like a new product launch, expert interviews and tips and tricks • Good deeds such as fundraisers and donations to worthy causesThere are some other important elements you should consider when developing your shareable content. First, take the time to learnwhich social networks your customers frequent and whether your company or brand is being discussed. If there are discussions takingplace, what are the topics? And what content, if any, is being shared? This information will help you tap into the motivating factorsthat are driving your customers to share content, which will help you shape future content for your user base.Driving Social Media and EmailSocial media should be directly tied to your other outreach efforts and vice versa.A best practice is to use social media to drive your opt-in list. On Facebook, youcan add a Join My Mailing List application to your page. On Twitter, promote yourlist by teasing your pending campaign and adding a link to your email signup form.You can also do the opposite: Use email to drive your social campaigns. Includesocial links and “share-to-social” links in your emails to drive content sharing.Marketing Guide 4

The Future of EmailTrend #3: The Social Inbox Rules for MarketersThe most popular email providers recently launched new What can you do about the social inbox? Some of the samefeatures, which integrated users’ social media feeds. In addition, rules apply.the new features allow users to better manage and control their • It’s now more critical to get your address added as contact.inbox by more prominently featuring the most relevant emails Ask your recipients to add you so that your messages areand filtering out those that are less desired. This creates a whole delivered with priority.new set of challenges and opportunities for marketers. Below we • To get your messages to stand out, your “from” and subjectcover the features of what is known as the “social inbox.” lines should reflect your company name and brand.Yahoo, Gmail and Hotmail Go Social • As always, be interesting and engaging to your reader. If youYahoo has created a “social hub” for its new version of consistently send messages that your reader wants to readYahoo!Mail. This includes an initial view of the inbox that only and does read, Gmail will push them to the top. As always, relevance is key.shows mail from people in an individual’s contact list. It alsoshows Facebook status updates and allows for posting directly to Trend #4: Social CurrencyFacebook and Twitter accounts. Social media marketing done right earns the brand socialGmail takes the Google search currency. The biggest banks delivering social currency arealgorithm and now applies it to Social currency Facebook and Twitter, each with hundreds of millions of users.the inbox. Its algorithms filter accounts for Facebook leads the pack with 750 million active users. Halfcontent based on the user’s 53 percent of of these are frequent visitors, returning to the site every day.interaction with a sender and brand loyalty. Twitter is used by 200 million. A little more than half of themalso within keywords found have one or more followers.in emails the user has opened. These filtered emails are given Both Facebook and Twitter present captive audiences for your“priority” and will be featured in a priority inbox. The user also messages and offer great potential for advocacy through sharinghas the ability to mark messages as more or less important. your content with their networks.Microsoft’s new Hotmail service includes a “sweep” feature that Social Currency Definedallows users to automatically send emails from a specific sender Social currency is shareable information that encourages moreto a folder other than the inbox or to be deleted automatically. social interaction. It is all about increasing your presence, offeringThis poses a great problem for email marketers if their email information, developing an identity and providing status oris chosen for deletion. Unlike an unsubscribe link, you will not recognition for your participants.receive feedback from a subscriber if they really do chose to end Social currency is a powerful commodity in this age of mobile,communication with you. social communication. It builds awareness and loyalty, whichFacebook’s Influence drives sales.Earlier this year, Facebook launched its own version of email Earning Social Currencycalled Facebook Messages. The message feature on Facebook has To market for social currency, start by listening. Chances arebeen in place for many years, but now users have the option of there are conversations happening about your brand right now.creating an “@facebook.com” domain email address. The same, Get into the conversation and leverage your current advocatesvery informal communication style is still in place. to gain more.Marketing Guide 5

The Future of Email • Check out current testimonials and reviews. Can you repurpose them as “tweets”? Facebook posts? • Gather positive feedback about your brand from Twitter. Share these “tweetimonials” with your network. Be sure to thank original reviewers to further solidify their loyalty. Also, by sharing their thoughts, it gives your advocates a bit of notoriety that may encourage others to offer their “tweetimonial” too. • Do a search for your brand and see where it pops up in Web forums and blogs. If you see good content, link to it from your Facebook page or “tweet it.” • Videos that promote your products are another easy way to create shareable content for social networks. OskKosh B’gosh “Spy Kids” Sweepstakes the email took readers to its Facebook OshKosh, a Lyris customer, leveraged page, where visitors are asked to “Like” its email list, Web site and social media OshKosh’s page to enter to win. presence to build excitement around a OshKosh continued to promote the sweepstakes. Five lucky winners would sweepstakes on its Facebook page with receive a movie screening “Spy Kids” “time is running out” posts. “Spy Kids” party and a $200 OshKosh B’gosh gift promoted the contest on its page card for back-to-school shopping. as well. OshKosh promoted the sweepstakes And, to round out the campaign, via email, which featured imagery from OshKosh’s Web page featured “Spy the movie as well as an eye-catching Kids”-inspired outfits to further and clear headline, “Win Your Own Spy build excitement. Kids Screening Party.” The link inAnd naturally, all these can be promoted over email too.Trend #5: Location-based MarketingLocation-based marketing is when smartphones and location-based social networks connect, allowing users to interact at specificphysical locations.For instance, if your friend has been named “mayor” at your local Chili’s restaurant, you’ve witnessed location-based marketing first-hand. When marketers know where subscribers are at any given point in time, many opportunities arise to market goods and servicesbased on that location. It’s all happening in real-time and requires that users are really engaged.When they arrive at a location, customers check in and earn rewards. Then, the applications alert friends that they have checked inat that location, say Chili’s restaurant. This shows the subscriber’s friends that she has an affinity for Chili’s. It essentially becomesan endorsement.Marketing Guide 6

The Future of EmailAnd it also presents the opportunity to cross-promote other goods and servicesbased on where that subscriber is located. It allows marketers to microtarget.It seems unusual that people are willing to share where they are at any given pointin time across social networks, but the data indicates that they’re doing it in droves.Facebook Places leads the charge with roughly 27 million subscribers, but smallernetworks like Foursquare, Loopt and Gowalla are emerging and growing.Why would subscribers be willing to give up this information? Because theyare incentivized.Incentives at the Right Place and TimeThere are many ways to create location-based promotions. • Check-in programs: If a customer checks in with a brand, he or she gets some percentage off a purchase. Location-Based Social Networks • Repeat check-in programs: Your most loyal customers receive a free item, for example, after a certain number of check-ins. • Becoming the Mayor: For Foursquare users, the individual who checks in to an establishment the most in a month becomes the “mayor.” Many brands offer gifts and promotions to their “mayors.”Location-based marketing is powerful because you are engaging customers in real time and delivering real value when they’remost receptive.Opportunities with EmailYou can promote these programs via email, however email presents additional opportunities to leverage your recipients’ location. • If you have a physical location to your business and want to invite your subscribers to an event, workshop or into your store to try products, you can segment your list to ensure that only those subscribers who can easily come to your store receive the email. If you don’t segment, you risk frustrating the subscribers who are out of your physical area. • If you have an online store and a physical store, promote both in your email campaigns. This gives your local subscribers a choice of where to shop. • All businesses, whether they are online or not, should personalize their emails. For example, mentioning the weather or seasonal products is a great idea, but make sure that you have segmented your list so that your message is appropriate. • Similarly, be cognizant that not all your subscribers celebrate national holidays. If you send an email that mentions a holiday, be careful not to offend your recipients with messages that don’t pertain to them. • On the flip side, it’s a good idea to celebrate local culture, whether it’s a sports team, band, a food the area is known for, etc. That kind of familiarity can quickly engage your subscribers and send them the message that you’re in tune with who they are and what is important to them.Trend #6: Shopper MarketingShopper marketing is defined as really getting a sense of how your customers shop, across all channels and formats, and using thatinformation to create mutually beneficial programs and incentives. You want to think of shopper marketing as completely integrated.Your message must be the same every time your customer is exposed to your brand.Marketing Guide 7

The Future of EmailOnline Still RisingShopping in the online space has been booming since the first e-commerce site. For example, the number of consumers who havebought packaged goods online has doubled since 2009, according to Neilson Co.Many of us aren’t just choosing to shop online, we’re bulk shopping online. Instead of returning to traditional stores for our goods, 30percent of shoppers are using auto-replenish or saved lists. This means that a good percentage are planning purchases in anticipationof desire, which is winning merchandisers huge and long-lasting rewards.Integrate for Increased EngagementToo many brands think of their “multi-channel strategy” as a portfolio of individual strategies, one for each of the channels theychoose to participate in, each with different tactics. Shoppers don’t care if your online marketing strategy and in-store marketingstrategy are managed by two different teams; they expect a seamless brand experience from channel to channel. Seventy percent ofthose surveyed by Hub Magazine are delivering consistent messages across all their marketing channels. JOY Keeps It Consistent JOY the store, a Lyris customer, also created consistency across its communications channels. The company featured a 20 percent off sale and promoted it via email, on its Facebook page and website home page. On the Facebook site, visitors are reminded of the big savings via Facebook posts and direct links to the page on its site with the sale items.Trend #7: MillennialsMillennials are defined as those born between 1981 and 2000. Characterized as diverse, skeptical, altruistic, frugal, green, candid andadept at multitasking, Millennials are at the cutting edge of technology use.Why should you care about Millenials? Because they look at us marketers with raised eyebrows. Millennials often confound marketers;they do not trust traditional marketing tactics, preferring to rely instead on friends, family or even strangers in the form of onlinereviews. What appeals to them is authenticity. They are not opposed to connecting with brands, but do so only when there is anexchange of value and, of course, when it is on their terms.Pew suggests that 93 percent of this cohort spends regular and extended periods of time online. The Web has become their primarysource of information, news, entertainment and a significant source of social interaction. Seventy-five percent of this group has asocial media profile. In fact, they spend at least 50 percent more time social networking than any other major age group. Eighty-eightpercent text regularly. Well over half, 55 percent, visited a social network at least once a day in 2010. More than 60 percent have asmartphone and only 41 percent have a landline telephone.Marketing Guide 8

The Future of EmailThe Right Medium, the Right Message • Do as They Do: When speaking to Millenials, mirror them.Marketers are leveraging the behavior of Millennials in a number Reputation is vital to this group, so they’re constantlyof ways. One is by ensuring their brand message is nuanced so tweaking their online persona to develop a presentation that best reflects who they are. Consider tweaking yourthat it fits a variety of communication platforms. brand in ways that reinforce what you represent.If you have the right Give Feedbackmessage but it’s in the 28 % of Millennials For Millennials, a delay in communication can be detrimental. found email receivedwrong medium, you The majority of the Millennials demand same-day feedback from companies tomay be in trouble. This for all digital communication platforms. Sixty-three percent be relevant.generation has rules about feel more connected when they get feedback, and 58 percentits communication. Each Source: B2B Online report a boost in confidence. A quarter feel alone when theydevice or platform is used don’t receive feedback, underlining the importance of keepingin ever-more specialized ways. For example, the phone is only Millennials in the loop.for emergencies and IM for working together on homework,according to a recent survey. Communicating via email for That’s key behavior information for marketers who want toa Millennial is just like going to dinner, a fairly connected deliver relevant, timely messages, generate advocacy and createexperience, while chatting over Facebook is just having coffee. chatter about their brand among this group.Also, offer value. Millennials are frugal. They’re entering the Trend #8: Social Gamingworkforce in a tough economy and are especially receptive to Social games are online games distributed primarily through socialspecial offers. In fact, a third surveyed want to receive deals networks. They typically feature multiplayer and play-any-time-from marketers, more than any other group. A recent study you-want mechanics, meaning you can jump into the game andshowed that 28 percent of Millennials found email received from enjoy it without awaiting another player’s move. Social games arecompanies to be relevant. Respondents also said they would amongst the most popular in the world, with several productspotentially welcome direct brand interactions via email, so long featuring millions of players.as they can control what and how much they receive. So, why should marketers care about social gaming? eMarketerMarketing to Millennials is complex, but not impossible. Follow reports that nearly 62 million US internet users, or 27 percentthis guide: of the online audience, will play at least one game on a social network per month this year. That’s up from 53 million in • Act Fast: If you have a Millennial’s attention, act on it quickly. This group tunes out traditional advertising and 2010. The group of daily players includes over 50 percent of marketing. If they want something, they have instant ability smartphone users and two-thirds of tablet owners. Finally, the through smartphones and the Web to get it. industry overall is exceedingly profitable, likely to surpass $1 billion in revenue this year. • Ask the Right Questions: Millennials are less likely to answer personal questions about what they buy and why. Big Industry with Bigger Returns Instead of asking which products are important to them, find out what is critical during the buying cycle. So, gaming is a booming industry, and a growing one for marketing messages. Virtual currency has turned gaming from • Build relationships: Millennials crave connection. It’s a good simply a diversion to a way brands can build loyalty and advocacy idea to avoid sending a promotion. Instead, send advice and while entertaining their key customers. relevant information.Marketing Guide 9

The Future of EmailVirtual Currency Key TakeawaysVirtual currency (or in-game currency depending on environment) The communication evolution is a fast-moving train. By keepingis used to purchase virtual goods within an online community; pace with the latest innovations, email marketers can stay onwhich include social networking websites, virtual worlds and board with the most creative — and profitable — ways toonline gaming sites. A key revenue driver within social media, leverage them. In this guide, we covered eight trends that willvirtual currencies are specific within each game and are used to drive the future of email. Keep the following in mind as youpurchase in-game goods. Experts predict revenue from virtual launch your next email marketing programs:goods will reach $6 billion in two years. • Mobile communications: The number of smartphones inPlay to Win Customers the hands of consumers is only going to rise, so tap into thatCompanies are tapping into social gaming to raise and extend market with campaigns that incorporate mobility.awareness of their brands. Through branded virtual goods, offers, • Social media: Smart engagement in social media can helpads and campaigns, businesses are experimenting with the idea grow your opt-in lists and targeted email campaigns canthat if customers play, they will pay. boost your social media networks. • The Social Inbox: Marketers now face new deliverabilityGetting Into the Action challenges. Be sure to stay tuned into this trend and createBrands are learning that games are effective tools for engaging an engaging, relevant emails so you don’t get shut out of youraudience and encouraging them to interact. key audience’s inbox. • Consider your image: To get started, first determine what • Social currency: Chatter about your brand carries a high type of games would best suit your brand image, mission value. Be open to the many ways to earn it. and audience. While you obviously want something that • Location-based marketing: Offer rewards and incentives engages, you don’t want to create something that conflicts that matter to your customers where they are in real-time, with your identity. and they will buy. • Monetize: A best practice is to make sure your gaming • Shopper-based marketing: Integrate your campaigns across strategy leads to experiences that enable you to monetize channels to ensure your customers receive consistent your efforts. What will drive the economy of your gaming messages. This will increase your returns. platform? Consider discounts for some of your add-on products or services or points toward your loyalty program. • Millennials: Get personal and build connections, but don’t Or you can follow the lead of Facebook, which created its cross the line. Messaging to this group must be tailored and own currency called Facebook credits. specific to their needs to make an impact. • Research: Apps in the digital age have a viral quality by • Social gaming: This booming industry offers up playful ways nature, and games are among the most spreadable. Take your customers can interact with your brand — and for you the time to learn what types of games other brands in the to cash in through virtual currency. industry are leveraging to engage their audiences, and what actions they took during the discovery process. Partnering up with a third-party channel could possibly generate more hype than the company Web site or blog alone.Marketing Guide 10

The Future of EmailRESOURCES Contact U.S.Learn more about Lyris HQ: 6401 Hollis Street, Suite 125www.Lyris.com Emeryville CA 94608 USA> go.lyris.com/facebook U.K. 232-242 Vauxhall Bridge Road> go.lyris.com/twitter London, SW1V 1AU United Kingdom> go.lyris.com/youtube> go.lyris.com/linkedin Latin America Luis Maria Campos 1059 3rd floor> go.lyris.com/flickr (C1426BOI) Ciudad de Buenos Aires, Argentina> lyrishq.lyris.com AustraliaAbout Lyris, Inc. 5/6 16-620 Harris StreetLyris, Inc. is the online marketing expert delivering the right mix of software technology Ultimo, NSW 2007, Australiaand industry knowledge to help its customers simplify their marketing efforts andoptimize campaign ROI. Through its on-demand integrated marketing suite, Lyris HQ, and Toll freereliable on-premise solutions, including Lyris ListManager, Lyris provides customers the +1.800.768.2929right tools to optimize their online and mobile marketing initiatives. International calls +1.510.844.1600 Fax +1.510.844.1598 Customer support +1.888.LYRIS.CS (597.4727) or +1.571.730.5259Marketing Guide Copyright © 2011 Lyris, Inc. All rights reserved. 11 August/2011 11

The Future of Email

by John Perez

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