Beyond the Click: Understanding the Full Value of Email to Your Business

Beyond The Click:! Understanding and keeping up with changing email! !

Its nice to meet you Jessica Jaye Harley VP Customer Marke5ng Gilt Groupe For context, prior experience includes: •  VP Online Marke;ng FTD.com •  VP Marke;ng Borders •  Director Marke;ng Barnes & Noble •  10 years direct marke;ng

Who we are •  Launched November 2007 •  Curate broad range of daily sales to serve membership •  Over 6,000 premium brands featured 3

Who we are •  1/3 of total company sales occur noon hour on weekdays •  Compe;;ve shopping •  Sales last 36 hours •  Average 160 sales/week

Who we are •  4.3 million ac;ve members •  Over 1/3 login in any month •  Extremely loyal customers •  65% Noir members purchase each month •  Interna;onal shipping launched November 2011

Who we are •  Named by Fast Company as one of the Top 25 Innova;ve Companies, #1 in Fashion •  Internet Retailer Top 500 Rank of 49 •  DMA 2011 Marketer of the Year

Who we are •  Growth largely fueled by fantas;c customer experience •  Acquired less than 1/3 of our members via paid marke;ng eﬀorts to date •  S;ll growing – 20% of purchasers each month are new customers

Who we are •  Women’s Fashion •  Men’s Fashion •  Children’s Clothing & Toys •  Home •  Gourmet Food & Wine •  Travel Experiences •  City Experiences

Who we are •  Shoot almost all our own photography •  Undergoing major rebranding •  Lighter, friendlier and more accessible •  Allows product and color to shine 9

Women’s – Nov, 2007 Launch

Home – launched 2008

Men’s – Oct, 2009 Launch

Baby & Kid’s – Jul 2008 Launch

Jetseger – Sep 2009 Launch

Gilt City-‐ Sep 2010 Launch

Taste – May 2011 Launch

Park & Bond – Aug 2011 Launch

Gilt Japan – Mar 2009 Launch

A lot has changed in these 4 years…

Email has changed too The big ques;on…

Is Email Dead?

Social leaders declared it

Mainstream media

Industry blogs

The evidence is moun;ng

Gilt’s tremendous growth has occurred within an email based model… During the ;me these claims have been so popular

How is this?

People are S;ll Paying Agen;on to email 87% of email users check personal email daily 51% of daily mobile email users check personal email 4+ ;mes daily Merkle; View from the Digital Inbox, February 2011

Even those who say they are not 60% of those who report they have a special account for retail emails say they check it daily Merkle; View from the Digital Inbox, February 2011

But they are changing HOW they interact with email

Mobile is Changing Email Usage

While s;ll the minority… Up 34%Return Path: Mobile, Webmail, Desktops: Where Are We Viewing Email Now?, Nov 2011. Mobile % increased 34% from April-‐Sept 2011 vs. prior 6 months

Mobile % is Growing Rapidly % Total Email Opens Up 51% 20% Mobile PC 80% Kno;ce, Mobile Email Opens Report ;First Half 2011, up vs. Q4 2010

Gilt’s mobile email opens are approaching half % Gilt Email Opens Mobile PC

Yet top brands engaging in email marke;ng are s;ll linking to full site 14% Link to Plain Web Site 17% Link to Mobile 69% Op;mized Site Link to Mobile Apps L2 Pres;ge 100©; Mobile IQ, January 11, 2012

Mobile has come to dominate on weekends Return Path: Mobile, Webmail, Desktops: Where Are We Viewing Email Now?, Nov 2011.

Mobile sales are following Gilt Mobile Sales % 73% HigherWeekend Weekday

Device usage also changes by ;me of day

Mobile % of sales also changes by ;me of day Mobile % of Gilts Total Sales +48% Full 24 hrs to 24hr9 to Midnight Noon to 9PM Midnight to Noon

How best to keep up with Mobile Email?

Ensure a single voice across channels

Be where customers are

YOY revenue growth fueled by mobile

Understand what works when

Link to App or M-‐Site

It is becoming clear that Email and Mobile will dominate over Social when it comes to revenue

Stores shupng down on Facebook Facebook stores that opened and closed in the past year: •  Gamestop •  Gap •  JC Penny •  Nordstrom

“It was like trying to sell stuﬀ to people while they’re hanging out with their friends at a bar”

Consumers prefer to receive promo;ons via email over social Where Consumers Prefer to Receive Retailer Promo5ons + + Social 4X 2X Email Adults* Youth 15-‐24** *Internet Retailer: Young consumers use e-‐mail to ﬁnd deals, July 2010 **Internet Retailer: For store promo;ons, e-‐mail tops social media, June 2010

Top Brands are promo;ng Social more than Mobile L2 Pres;ge 100©; Mobile IQ, January 11, 2012

Social is crucial to brands, email and mobile beger cater to direct response sales driving

Social is a great tool for brands to build a rela;onship

Provide fantas;c customer service…. Hi Gilt, me again. Well, late tonight you totally solved the order problem in a kind of unexpected, "wow" way. Thanks!

Important part of the promo;onal mix…

Build excitement for sales and promo;ons….

Drive Awareness and engagement

Drive loyalty among exis;ng customers…. Gilt Social Promo5on Sales New Customers Exis;ng Customers

Understand full impact of email

Gilt open rates remain steady in the face of rapid growth, but click rates are declining Open% Click% 2009 2010 2011

Problem? Let’s understand the cause

Mobile email openers are not clicking % Gilt Email Opens % Gilt Email Clicks Mobile PC PC

Tabbed browsing prolifera;on also likely causing click declines 57% of users switch tabs in a session Jeﬀ Huang, Ryen W. White (June, 2009). "Parallel Browsing Behavior on the Web"

How should email revenue be measured?

Based on direct click revenue? Gilt Email Revenue % Total Click Only Email Revenue Non-‐Email Revenue

What if we add in revenue from same day email clickers? Gilt Email Revenue % Total w/Clickers Email Revenue Non-‐Email Revenue

How about email openers who purchase in same day? Gilt Email Revenue % Total w/Openers Email Revenue Non-‐Email Revenue

Or revenue from all same day email recipients? Gilt Email Revenue % w/Recipients Email Revenue Non-‐Email Revenue

Perhaps oversta;ng it, but… Some por;on of Gilt Email Revenue % w/Openers these sales are driven by email received Email Openers & Clickers Email non-‐Openers Email Non-‐ Recipients

The key is we need to be ﬂexible in our understanding of email’s value or we could be making wrong decisions

When tes;ng, ensure right metrics Email Tes;ng – Ensure that you are capturing the full impact of tests with cross channel ac;vity Lifecycle Marke;ng – Ensure that purchases are incremental over ;me Cross Channel Promo;ons – Does total spending behavior change a{er cross-‐channel promo;on?

Even crea;ve tes;ng can have impact beyond click revenue

Bricks & Clicks is more challenging Loyalty Cards – If customers are earning something they have incen;ve to give you email and pull out the card Store Credit Cards – Will always impact a lower % of customers, but will be most loyal ones Credit Card Data Analysis – Painful route

What would an email presenta;on be without discussion of Relevancy?

Relevance is now more important than ever Single campaign w/segments by format, oﬀer, # sales, products, etc. across channels Stated Preferences Loyalty Machine Program(s) Learning Predic;ve $" Models Campaign Management Purchase/ Browse Member History Data Cube """""" """"""" """"""" User Input """"""" """""""Merchandise Strength $ Customer Spend, RFM, Outside Data (Demo/ Sa;sfac;on Lifecycle Shopping) 5 4 3 2 Series1 1 0 1 2 3 4 Series1 Campaign Results

Personalized sale emails drive +10% revenue across all customers

User input drives up to 31X to 50X revenue li{s

Lifecycle marke;ng drives up to 2-‐5X revenue increases

But lifecycle messaging can easily be overused

Behavioral targe;ng drives up to 20X revenue li{

User discre;on needs to be used in conjunc;on with sta;s;cs

Key Takeaways Uniﬁed Voice – across all channels Understand what is behind data – It could change your strategies Be where your customers are – Understand the mindset they are in Be relevant and ﬂexible – Adapt, adapt adapt

Ques;ons? Jessica Harley VP Customer Marke;ng Gilt Groupe jharley@gilt.com

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Beyond the Click: Understanding the Full Value of Email to Your Business

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Beyond the Click: Understanding the Full Value of Email to Your Business Presentation Transcript