New Best Practices for Opt Out Management<br />Jeff Nicholson<br />VP of Product Marketing, CAI<br />Pitney Bowes Business...
What is Opt-out?<br />Opt-out: “When a recipient unsubscribes or opts-out of further communications”<br />Source: The Dire...
What’s Happening to our Outbound Response Rates?<br />The new customer is in control<br />Social circumvention<br />Ad fat...
Content Placeholder<br />
Content Placeholder<br />
What happens now when you get it wrong…<br />
The New Marketer?<br />
“For the longest time, marketers have mistakenly regarded email marketing as “free”. Strategic marketers are finally wakin...
Opt-out rates are Significant<br />
Content Placeholder<br />
Content Placeholder<br />
The Impact of Opt-out is Cumulative (snowball effect)<br />Reachable Customers<br />Real-world Example:<br />Major US Reta...
50% of these customers have opted out</li></ul>Reachable Customers<br />Reachable Customers<br />“Reachability”<br />Reach...
WHAT’S STANDINGIN YOUR WAY<br />DRIVERS<br />SYMPTOMS<br />Incomplete Data<br /><ul><li>Absent or inaccurate email address...
Retention & renewal
Engage in dialogue</li></ul>Your Ability to Influence<br />
One Moment in Time. <br />Opt-out<br />No Opt-out<br />Outcome:<br /><ul><li>Opt-out</li></ul>Impact: <br /><ul><li>Long T...
Ad Fatigue
Spam rating</li></ul>Impact: <br /><ul><li>Short Term</li></ul>YourCampaign<br />
How are YOU measuring campaign success?<br />Campaign<br />Opt-in CLV(Influenced Lifetime Value)<br />Customer Revenue<br ...
How Much is Opt-out Costing YOU?<br />“To optimize customer lifetime value, organizations must fundamentally change how th...
Assessing the Impact of Opt-out to your Organization <br />?<br />
Marketers Must Re-assess Campaign Success<br />Example:<br /><ul><li>Campaign Size: 500,000
Revenue per Conversion: $200
Response rate: 2%
Conversion: 30%</li></ul>$600K<br />($3.5M)<br />Immediate Value<br />X($350)<br />($1.75M)<br />Lost Future Value<br />X ...
Degraded CLV: $350</li></ul>X $200<br />=3,000<br />Avg Per Purchase<br />Purchases<br />= 10,000<br />=5,000<br />Contrib...
The Critical Importance of “Getting it Right”<br />First 30 Days<br />31 – 60 Days<br />61 – 90 Days<br />90 – 180 Days<br...
Ask Yourself:<br />How many emails does your highest value customer receive every week?<br />When was the last time you ha...
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New Best Practices for Opt Out Management

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  • The Path Less Travelled?
  • New Best Practices for Opt Out Management

    1. 1.
    2. 2. New Best Practices for Opt Out Management<br />Jeff Nicholson<br />VP of Product Marketing, CAI<br />Pitney Bowes Business Insight<br />
    3. 3. What is Opt-out?<br />Opt-out: “When a recipient unsubscribes or opts-out of further communications”<br />Source: The Direct Marketing Association<br />
    4. 4. What’s Happening to our Outbound Response Rates?<br />The new customer is in control<br />Social circumvention<br />Ad fatigue<br />The changing view of “marketing”<br />(A) advocational marketing<br />(B) adversarial marketing<br />“Crouching customer, hidden opportunity.”<br />
    5. 5. Content Placeholder<br />
    6. 6. Content Placeholder<br />
    7. 7. What happens now when you get it wrong…<br />
    8. 8. The New Marketer?<br />
    9. 9. “For the longest time, marketers have mistakenly regarded email marketing as “free”. Strategic marketers are finally waking up to the consequences of getting it wrong.”<br />Source: Pitney Bowes Business Insight<br />
    10. 10. Opt-out rates are Significant<br />
    11. 11. Content Placeholder<br />
    12. 12. Content Placeholder<br />
    13. 13. The Impact of Opt-out is Cumulative (snowball effect)<br />Reachable Customers<br />Real-world Example:<br />Major US Retailer<br /><ul><li>Email address for 70% of customers
    14. 14. 50% of these customers have opted out</li></ul>Reachable Customers<br />Reachable Customers<br />“Reachability”<br />Reachable Customers<br />Time<br />
    15. 15. WHAT’S STANDINGIN YOUR WAY<br />DRIVERS<br />SYMPTOMS<br />Incomplete Data<br /><ul><li>Absent or inaccurate email address</li></ul>The Customer “Reachability” Funnel<br />Data Quality<br />Spam Filter<br /><ul><li>Level 1 deliverability failure (often blind)</li></ul>Content Quality<br />Mental Opt-out<br /><ul><li>Deletion is now habit</li></ul>Junk Filter (client)<br /><ul><li>Level 2 deliverability failure (blind)</li></ul>Frequency + Relevancy<br />Explicit Opt-out<br /><ul><li>Unsubscribe flag requested</li></ul>Reachability vs.Deliverability<br />Opportunity<br /><ul><li>Cross-sell offers
    16. 16. Retention & renewal
    17. 17. Engage in dialogue</li></ul>Your Ability to Influence<br />
    18. 18. One Moment in Time. <br />Opt-out<br />No Opt-out<br />Outcome:<br /><ul><li>Opt-out</li></ul>Impact: <br /><ul><li>Long Term</li></ul>Outcome:<br /><ul><li>Response
    19. 19. Ad Fatigue
    20. 20. Spam rating</li></ul>Impact: <br /><ul><li>Short Term</li></ul>YourCampaign<br />
    21. 21. How are YOU measuring campaign success?<br />Campaign<br />Opt-in CLV(Influenced Lifetime Value)<br />Customer Revenue<br />Degraded CLV(The slashed value due to opt-out)<br />Time<br />Opt-out CLV(Incidental Lifetime Value)<br />Your Campaign is a Fork in the Road<br />Did your campaign have a net positive effect? <br />Campaign-derived Revenue vs. the Degraded Future CLV<br />
    22. 22. How Much is Opt-out Costing YOU?<br />“To optimize customer lifetime value, organizations must fundamentally change how they measure campaign effectiveness”<br />
    23. 23. Assessing the Impact of Opt-out to your Organization <br />?<br />
    24. 24. Marketers Must Re-assess Campaign Success<br />Example:<br /><ul><li>Campaign Size: 500,000
    25. 25. Revenue per Conversion: $200
    26. 26. Response rate: 2%
    27. 27. Conversion: 30%</li></ul>$600K<br />($3.5M)<br />Immediate Value<br />X($350)<br />($1.75M)<br />Lost Future Value<br />X ($350)<br />Impact to Future Value<br />Lost Future Value<br />Impact to Future Value<br /><ul><li>Opt-out rate: 1%
    28. 28. Degraded CLV: $350</li></ul>X $200<br />=3,000<br />Avg Per Purchase<br />Purchases<br />= 10,000<br />=5,000<br />Contribution to Future Opt-out<br />Flag as Junk<br />Opt-outs<br />Spam<br />X 30%<br />Noise<br />Conversion<br />20%<br />67.5%<br />Not Delivered<br />No Immediate Action<br />Mental-Opt-out<br />Junk Mail Filter<br />Opt-out<br />Response<br />3%<br />2%<br />Junk<br />6%<br />Response<br />1%<br />Mental Opt-out<br />Opt-out<br />
    29. 29. The Critical Importance of “Getting it Right”<br />First 30 Days<br />31 – 60 Days<br />61 – 90 Days<br />90 – 180 Days<br />180 – 240 Days<br />Less Relevant<br />Less Relevant<br />Very Relevant<br />Less Relevant<br />Very Relevant<br />Less Relevant<br />Very Relevant<br />Less Relevant<br />Less Relevant<br />Less Relevant<br />Very Relevant<br />Less Relevant<br />Less Relevant<br />Very Relevant<br />Less Relevant<br />Less Relevant<br />Very Relevant<br />Less Relevant<br />Very Relevant<br />Less Relevant<br />Less Relevant<br />Very Relevant<br />Less Relevant<br />Very Relevant<br />Less Relevant<br />Less Relevant<br />Less Relevant<br />Less Relevant<br />Less Relevant<br />Very Relevant<br />Which straw will “break the camel’s back?”<br />The new “getting it right”: It’s not just about potential relevance<br />What to send + What NOT to send<br />
    30. 30. Ask Yourself:<br />How many emails does your highest value customer receive every week?<br />When was the last time you had a management discussion regarding which campaigns NOT to send to your top customers?<br />Yet, do you have a goal of maximizing the lifetime value of each customer?<br />
    31. 31. The New Fundamental Framework for Opt-in Optimization <br />Don’t just manage the opt-out process.<br />Address the opt-out problem.<br />
    32. 32. Opt-in Optimization Fundamental Framework<br />Don’t just manage the opt-out process. Address the opt-out problem.<br />Measure Exposure<br />Inform<br />Segmentation<br />Measure and monetize opt-out.<br />Preference & Prediction<br />Contact Governance<br />Prevent future opt-outs.<br />Capture<br />Declaration<br />Adhere<br />Ensure regulatory compliance.<br />Inbound Interactions<br />Transactional Contact<br />Maximize the opt-in opportunity.<br />
    33. 33. Increase opt-out visibility to improve offer selection<br />C. Pre-filter<br /><ul><li>Filter opt-out during segmentation</li></ul>D. Consider<br /><ul><li>Assess recency and frequency metrics for segment</li></ul>UnderstandMeasure and monetize opt-out<br />Measure Exposure<br />Inform<br />Segmentation<br />Understand what opt-out is costing your business<br />A. Measure<br /><ul><li>Understand campaign’s true success (response vs. opt-out)</li></ul>B. Monetize<br /><ul><li>Understand the impact of opt-out on customer value (opt-out x dCLV).</li></li></ul><li>Preference & Prediction<br />Contact Governance<br />Make sure the business adheres to plan<br />Understand desires of individual customers<br />C. Enforce<br /><ul><li>Governance rules in place</li></ul>D. Alternatives<br /><ul><li>Offer alternatives to opt-out</li></ul>A. Listen <br /><ul><li>Channel
    34. 34. Frequency
    35. 35. Focus</li></ul>B. Predict<br /><ul><li>Predict uplift
    36. 36. Predict likely opt-outs</li></ul>PreserveStop your best customers from opting out<br />
    37. 37. Capture Declaration<br />Adhere<br />Accept opt-out flags across customer base.<br />Ensure compliance across affected channels.<br />B. Enforce<br /><ul><li>Subscription compliance rules and systems in place</li></ul>A. Listen <br /><ul><li>“Capture the flag”</li></ul>ComplyEnsure regulatory compliance<br />
    38. 38. Inbound Interactions<br />Transaction Touch Points<br />Leverage the transactional engagements.<br />Engage with opt-outs when they come to you!<br />C. Transactional Documents<br /><ul><li>95% open rate</li></ul>D. POS<br /><ul><li>Initiate opt-in dialogue</li></ul>E. Incentivize<br /><ul><li>Incentivize opt-in (CLV)</li></ul>A. Prove it<br /><ul><li>Demonstrate value first</li></ul>B. Re-connect<br /><ul><li>Preserve using customer preferences, contact governance, dialogue</li></ul>Re-engageMaximize the opt-in opportunity – get your opt-outs back<br />
    39. 39. Opt-in Optimization Fundamental Framework<br />Don’t just manage the opt-out process. Address the opt-out problem.<br />Measure Exposure<br />Inform<br />Segmentation<br />Measure and monetize opt-out.<br />Preference & Prediction<br />Contact Governance<br />Prevent future opt-outs.<br />Capture<br />Declaration<br />Adhere<br />Ensure regulatory compliance.<br />Inbound Interactions<br />Transactional Contact<br />Maximize the opt-in opportunity.<br />
    40. 40. PBBI CAN HELP<br />SYMPTOMS<br />DRIVERS<br />RESOLUTION<br />Optimize <br />CLV<br />“More Customer Base”<br />Understand<br /><ul><li>Measure exposure
    41. 41. Inform segmentation</li></ul>Preserve<br /><ul><li>Preference & prediction
    42. 42. Contact governance</li></ul>Comply<br /><ul><li>Capture declaration
    43. 43. Adhere</li></ul>Re-engage<br /><ul><li>Inbound interactions
    44. 44. Transactional touch points</li></ul>Explicit Opt-out<br /><ul><li>Unsubscribe flag requested
    45. 45. Customer Analytics and Interaction Solutions
    46. 46. Communications Management Solutions
    47. 47. Consulting Services</li></ul>Mental Opt-out<br /><ul><li>Deletion is now habit</li></ul>Frequency + Relevancy<br />Junk Filter (client)<br /><ul><li>Level 2 deliverability failure (blind)</li></ul>Spam Filter<br /><ul><li>Level 1 deliverability failure (often blind)</li></ul>Assess<br /><ul><li>Deliverability validation
    48. 48. Customer Analytics and Interaction Solutions</li></ul>Content Quality<br />Improve<br /><ul><li>Collect valued data
    49. 49. Validate accuracy
    50. 50. Enrich 360° view
    51. 51. Customer Data & Location Intelligence Solutions
    52. 52. Customer Analytics and Interaction Solutions</li></ul>Incomplete Data<br /><ul><li>Absent or inaccurate email address</li></ul>Data Quality<br />Opportunity<br /><ul><li>Cross-sell offers
    53. 53. Retention & renewal
    54. 54. Understand VOC
    55. 55. Engage in dialogue</li></ul>Your Ability to Influence<br />Maximize Opt-in,<br />Minimize Opt-out<br />The “Reachability” Challenge NOW has a Solution<br />
    56. 56. Thank You<br />Jeff NicholsonVP of Product Marketing, CAI<br />Pitney Bowes Business Insight<br />E: Jeff.Nicholson@pb.com<br />T: @jnicholson30<br />L: http://www.linkedin.com/in/jeffnicholson<br />

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