INTRODUCTION    Email marketing isn’t new. When it comes to making    headlines in marketing newsletters and at industry  ...
“For me, the best thing about email as a communication tool is itsefficiency. It’s quick, simple, and can be done on your ...
X-FACTOR                            1        FAMILIARITY                         Because email isn’t new, consumers are fa...
“To get ongoing deals, I typically                                          ACCORDING TO YOUR CONSUMERS:go to the company’...
X-FACTOR                             2        MANAGEABILITY              93% of U.S. online consumers are SUBSCRIBERS,    ...
SOMETIMES,LESS IS MORE                                    41%              of                                             ...
X-FACTOR                                     3          TRUST AND PRIVACY                        If consumers don’t trust ...
Consumers receive an average of  44emails a day, 25% of which are permission-based commercial messages.   “I only provide ...
X-FACTOR                         4        RELEVANCY                Consumers know it’s possible for companies    1    CONT...
“Stop sending everyone everything! I want to receive what’sinteresting and relevant to me, not information for another gro...
“I sign up for email when they promise something exclusive:              coupons, shopping codes, etc.”              -Dani...
MOTIVATING YOUR CONSUMERS TO SUBSCRIBEOverall, promotions are a primary motivator when people are choosing whether or not ...
CUSTOMER SUCCESS                                    GROUPON’S X-FACTORS                                                   ...
WAIT—                                                     THERE’S                                                     MORE...
Email remains the critical foundation for yourinteractive marketing strategy. But you needa provider with state-of-the-art...
Email Marketing X-Factors
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Email Marketing X-Factors

  1. 1. INTRODUCTION Email marketing isn’t new. When it comes to making headlines in marketing newsletters and at industry events, email’s not typically at the top of the list. But even without the glitz and glamour, the facts remain: More than 93% of online consumers are SUBSCRIBERS, and have provided their email address to at least one company or brand. 88% of U.S. online consumers check email daily, and 94% use email at least once a week. And more than 50% of consumers make purchases as a direct result of email­ it drives more — conversions than any other channel. So while email isn’t new, it certainly isn’t dead. But why does email work when it comes to your marketing communications? What makes this channel unique and effective? In this second report of our SUBSCRIBERS, FANS, & FOLLOWERS series, we’ll expose why email continues “I’m more comfortable to be an effective form of communication with your customers by revealing its x-factors—characteristics that set email apart from any other interactive marketing channel. EMAIL’S X-FACTORS INCLUDE: with conveying personal 1. FAMILIARITY information through email. 2. MANAGEABILITY 3. PRIVACY AND TRUST I don’t trust the social 4. RELEVANCY networks—I hear too 5. EXCLUSIVITY As SUBSCRIBERS, FANS, & FOLLOWERS continues to explore many things about peoples’ consumer motivations as they relate to Email, Facebook, and Twitter, we’ll begin with the oldest and most established accounts getting hacked.” channel—email marketing. By revealing email’s x-factors, we’ll help you remember why email can provide a critical foundation -Jennifer, 35, Detroit, MI for your online marketing, so you can build an integrated strategy that will work across all interactive channels.2 © 2010 ExactTarget
  2. 2. “For me, the best thing about email as a communication tool is itsefficiency. It’s quick, simple, and can be done on your terms.”-Brian, 31, Philadelphia, PA © 2010 ExactTarget 3
  3. 3. X-FACTOR 1 FAMILIARITY Because email isn’t new, consumers are familiar with the technology, are comfortable using it, and know exactly what to expect. They’ve also grown accustomed to using email as a way of engaging with brands, making it top-of-mind when it comes to interacting with a company. In the course of our research, we investigated two of the most common ways consumers proactively engage with brands via email: 1 OBTAINING PROMOTIONS AND DEALS The internet has simplified price and promotion shopping, and 82% of consumers will search a variety of online channels to obtain deals and promotions. For the majority of consumers, they begin their search by checking a particular brand’s corporate website. 76% of consumers will initially seek deals and promotions on a brand’s website, and from there, 62% will sign up to receive email, while 54% will use a search engine. 17% of consumers will also include Facebook as part of their quest for ongoing deals, and 3% will search for deals on Twitter. Women are more likely than men to sign up for emails (67% compared to 57%), and older consumers are also more likely to sign up for emails to get ongoing deals. However, the difference based on age is far less than may be expected. In fact, Millennials (aged 15-24) are twice as likely to subscribe to email in their search for ongoing deals (56%) as they are to search for deals on Facebook (28%). 2 CUSTOMER SERVICE COMMUNICATIONS The internet has also changed how organizations approach customer service. In the age of immediate gratification, the importance of customer service has been magnified. And although social media has given customers a way to publicly air their grievances against a brand, the majority of customers still prefer to deal with customer service issues in private—over the phone, through a company’s website, or through email. When faced with a customer service issue, 41% of customers will communicate via phone, 33% via company websites, and 20% via email. 37% of customers will send an email after an unsuccessful first attempt, making it the most common second step in the process of dealing with a customer service issue. Consumers often turn to email for customer service requests because an immediate response is not always necessary. Email is seen as an efficient way of dealing with issues without having to wait on the phone for help, or turn to social media where privacy is lost.4 © 2010 ExactTarget
  4. 4. “To get ongoing deals, I typically ACCORDING TO YOUR CONSUMERS:go to the company’s website first. THE STRENGTHS AND WEAKNESSES OF EMAILThen I check out any emails they STRENGTHS: • PRIVACY: Email is trusted as a safe and secure way forsend letting me know of upcoming handling private matters. And even the heaviest social network users prefer to handle private matters through or products. After that, I’ll see • FLEXIBILITY: Many consumers wait until the evening or weekend to catch up on email. So while they like the immediacy of sending an email, they appreciate the ability to respond at their own leisure.if they’re on Facebook.” • DOCUMENTATION: Email has largely replaced traditional mail as the channel for official communications. People like having a written record of what they say, especially in business or when-Russ, 38, Sacramento, CA dealing with companies online. WEAKNESSES: • SPAM AND VIRUSES: Consumers almost universally believe56% that spam continues to be a problem when dealing with email. Spreading or contracting viruses also remains a concern. of Millennials subscribe • MISCOMMUNICATION: Consumers continue to struggle with miscommunication when it comes to email messages, since it canto email in their search for ongoing be difficult to convey emotion, tone, or inflection. • NON-RESPONSE: Consumers are continually frustrated whendeals compared to 28% who search the contacts they’ve delivered messages to don’t respond.for deals on Facebook. © 2010 ExactTarget 5
  5. 5. X-FACTOR 2 MANAGEABILITY 93% of U.S. online consumers are SUBSCRIBERS, large generational shift away from email is occuring, meaning they receive at least one permission-based this is a misinterpretation. The amount of email commercial email message on a typical day. But with teens receive increases significantly when so many brands and companies communicating with they graduate from high school, suggesting consumers on a daily basis, many marketers worry about life stage—not age—is a more important factor overflowing inboxes, which could lead to consumers when considering how much consumers rely abandoning email or declaring ‘email bankruptcy.’ on email. Email is the accepted channel for “important” or “official” communications, and Marketers (especially online marketers) receive two to as consumers advance through different life three times as much email than the average consumer stages, their use of email increases as they on a typical day. The average consumer receives 44 interact in these capacities. daily emails (including commercial and personal), and half of consumers receive fewer than 25 per Another factor that makes email manageable? day. While these numbers aren’t small, most consumers The flexibility consumers have to respond at their consider the size of their inboxes manageable. So while leisure. Many consumers wait until the evening marketers may be overwhelmed by overflowing inboxes, or weekend to catch up on email. So while they most of their customers aren’t. like the immediacy of sending an email message, they appreciate the ability to respond at their Of those 44 daily emails, about 25% are permission- own pace. This offers based commercial messages, with the remaining a welcome contrast 75% comprised of personal messages, transactional to the intrusiveness messages, and spam that’s quickly deleted. of phone calls and The average teen (aged 15-17) receives less than texting or the real- half the email of the average consumer, and receives time urgency of only four commercial emails per day. And while Facebook and Twitter. marketers often interpret these statistics to mean a “You don’t have to worry about whether someone is going to answer your phone call. You can just shoot them an email, and when they receive it, they usually respond right back to you.” -Daniel, 29, South Bend, IN6 © 2010 ExactTarget
  6. 6. SOMETIMES,LESS IS MORE 41% of U.S. internet usersJust because consumer inboxes maybe less crowded than commonly threatened tothought doesn’t mean you should stop buying fromsend more. Studies repeatedly showthat consumers believe commercial companies thatemail comes too frequently. A sent irrelevantrecent CMO Council study* found that41% of U.S. internet users threatened messages,to stop buying from companiesthat sent irrelevant messages. The according toproblem isn’t that consumers receive a recent CMOtoo much email—it’s that they receivetoo many messages that fail to Council study.communicate with them as individualSUBSCRIBERS. In short, relevancyis the key to frequency.*CMO council (2009), “Why RelevanceDrives Response and Relationships”, © 2010 ExactTarget 7
  7. 7. X-FACTOR 3 TRUST AND PRIVACY If consumers don’t trust you, they won’t subscribe to Established brands have a distinct advantage when it comes your communications. But by building a trusting relationship to earning the trust of their consumers. Consumers tend centered on respect for privacy, marketers have a great to give the benefit of the doubt to big brands, and assume opportunity to increase loyalty—and ROI. their email addresses will be safe, secure, and unshared. If you’re a well-known brand, you must continue to honor In order to build trust, it’s important to understand the two this consumer trust to ensure your subscription list—and concerns that are top-of-mind for consumers when considering reputation—remain intact. whether or not to supply their email address to a company: In contrast, consumers will do additional research on “WILL MY EMAIL BE SHARED?” unknown brands before offering their email addresses. 1 They’ll google company names, and review complaint Consumers know that spam is a risk when sharing history and comments on Facebook and Twitter. If you’re their email address, since certain companies may choose to a small brand, it’s even more important you proactively sell or share this information. manage email addresses, as well as your social media presence, since these comments can have a direct “HOW DIFFICULT WILL IT BE TO 2 UNSUBSCRIBE?” impact on subscriber registration. Companies are required by law to honor unsubscribe requests in a timely manner. But consumers have learned that not all companies are diligent about unsubscribes. 62% of consumers mistakenly believe website privacy policies prevent their information from being shared without their permission, according to a recent University of Pennsylvania and U.C. Berkeley School of Law study.* *Turow et al., “Americans Reject Tailored Advertising and Three Activities that Enable It” (September 29, 2009). Available at SSRN: © 2010 ExactTarget
  8. 8. Consumers receive an average of 44emails a day, 25% of which are permission-based commercial messages. “I only provide my email if it’s for a company whom I trust, which are companies I regularly do business with, or sites given to me by a trusted friend. When it comes to smaller, more unknown companies, I have gotten into the habit of googling the name to check it out.” – Angela, 28, Ann Arbor, MI © 2010 ExactTarget 9
  9. 9. X-FACTOR 4 RELEVANCY Consumers know it’s possible for companies 1 CONTENT IS CLEARLY PERSONALIZED. to send targeted and personalized messages, meaning relevancy is no longer an option Consumers can quickly identify bulk messages. How the content is targeted is less for marketers. And when it comes to email, important than noticeable evidence that personalization is present. consumers quickly decide which companies they like to receive messages from—versus 2 THE ADVANTAGE OF BEING ON THE EMAIL LIST IS CLEAR. those they don’t—based on whether the SUBSCRIBERS want to see that they’re getting information that’s not widely email message is relevent or not. promoted to the general public, which can be made evident through special deals, promotions, or for-their-eyes-only content. Our research found that half (49%) of consumers “always” open emails from According to MarketingSherpa’s 2010 Email Benchmark Survey, two-thirds of their “favorite” companies, compared to marketers say that delivering relevant content to customers is a highly-effective only 16% who say they never open email. marketing tactic. And according to Econsultancy’s How We Shop in 2010 Study, the biggest difference between valuable and non-valuable email programs is So how can you get on your consumers’ whether or not the information provided relates to the interests of the customer. “favorite” list? To get a sense of messages Marketers and consumers agree—relevancy is a must. deemed worthy of “always opening,” we asked consumers to name specific companies they feel do the best job. Two themes emerged:10 © 2010 ExactTarget
  10. 10. “Stop sending everyone everything! I want to receive what’sinteresting and relevant to me, not information for another group.I’m not interested in those non-relevant messages, and they makeme much more likely to delete them as a contact.”-Jeff, 42, Sarasota, FL © 2010 ExactTarget 11
  11. 11. “I sign up for email when they promise something exclusive: coupons, shopping codes, etc.” -Daniel, 22, San Antonio, TX X-FACTOR 5 EXCLUSIVITY If there’s one thing that makes email unique above all other EARLY NOTIFICATION: By becoming SUBSCRIBERS, communication channels, exclusivity is it. While only a third 2 consumers expect to be the “first to know” about of consumers said they were motivated by the promise of upcoming promotions and sales. It’s important that marketers exclusive content when choosing to become a SUBSCRIBER, honor this expectation, since consumers want to make sure they can email’s exclusivity factor extends way beyond content. take advantage of special offers before they become widely known. They will eventually share this information with friends and family, but Becoming a SUBSCRIBER is like becoming a member only after they’ve had a chance to capitalize on the offer themselves. of an exclusive club. As mentioned earlier, SUBSCRIBERS demonstrate their trust in a brand when they provide a company with their email address. And in return, they expect to be a 3 EDUCATION: Consumers rely on brands to keep them informed about topics that interest them, especially if part of an exclusive club that receives all of the members-only they’ve provided that company with their email address. This perks outlined below: educational content can be distributed in the form of newsletters or alerts, to the exclusive group of email SUBSCRIBERS. And while PROMOTIONS AND DEALS: 81% of SUBSCRIBERS 1 have been motivated to provide a company with their consumers may be able to search for this content elsewhere, the exclusive e-newsletter keeps them informed on a regular basis. email address due to some form of promotion. And when consumers actively seek promotions from a particular brand, TAILORED CONTENT: Consumers expect brands to 62% end up opting-in to receive that brand’s emails, compared to 4 tailor content to their individual preferences. They view the only 17% of consumers who will check Facebook, and 3% who messages they receive through social media as being appropriate check Twitter. Because email is the only outbound marketing for general audiences, but they expect email content to be channel that allows marketers to proactively contact consumers specific to their interests and needs. Once again, they realize with promotions, SUBSCRIBERS know they must be exclusive they can only receive this relevant messaging if they choose to members of the email list in order to receive these great deals. become an exclusive member of a brand’s subscriber list.12 © 2010 ExactTarget
  12. 12. MOTIVATING YOUR CONSUMERS TO SUBSCRIBEOverall, promotions are a primary motivator when people are choosing whether or not to subscribe to your communications.81% of SUBSCRIBERS have been motivated to provide a company with their email address due to some form of promotion—from giveaways to deals to upcoming sales. And women are more likely than men to be motivated by promotions. 88% ofwomen indicate that promotions have motivated them to become a SUBSCRIBER, compared to 70% of men. Thisdifference is most pronounced for “freebies” offered in exchange for an email address, where 65% of women are motivated bythis type of giveaway compared to 44% of men.And contrary to conventional thought, older consumers aren’t the only people who are motivated by promotions. Promotionsare the primary motivator for teens who sign up for a company’s email list. However, teens are more likely to be motivatedby “social” factors than older consumers. For example, they’re more likely to subscribe to email newsletters for fun andentertainment (43% vs. 28%), or because someone recommended it to them (27% vs. 16%). © 2010 ExactTarget 13
  13. 13. CUSTOMER SUCCESS GROUPON’S X-FACTORS An ExactTarget customer since 2009, Groupon (www. is a deal-of-the-day website that’s localized to major cities around the world, currently serving more than 60 markets. The company offers one “Groupon” per day—specific to its different markets—delivered early in the morning by email. If a certain number of people sign up for the featured offer or promotion, the deal becomes available to all, but if the predetermined minimum is not met, no one gets the deal that day. Groupon has seen tremendous growth in its short history as a company. Andrew Kordek, Groupon’s manager of email optimization, has seen his subscriber list grow from 1.2 million in October 2009 to 5.5 million to date, totaling more than 1 billion emails sent per year. In short, Groupon has found email’s x-factor, mainly due to: EXCLUSIVITY: Each day, Groupon features local deals and 1 promotions at unbeatable prices. But you can only take advantage of the savings if you’re a Groupon email subscriber. This exclusive club of 5.5 million subscribers continues to grow. GIVING CONSUMERS WHAT THEY WANT: Groupon isn’t 2 delivering a traditional marketing message. They provide a service that’s solely dedicated to saving their customers money, while driving traffic to local businesses. 3 RELEVANCY: Groupon’s daily deals are specific to geographic locations, so customers receive relevant offers based on their city’s businesses. Each market is in effect its own list, with emails featuring the day’s deals for that particular locale. Groupon has discovered the power of email marketing by capitalizing on its x-factors, and Kordek sums up their success by explaining, “Email marketing is not a one-way communication. You need to take yourself out of the company and put yourself in the subscriber’s shoes. As a marketer, you’re not in charge of the email—your subscriber is. Let the customer and subscriber dictate how you should run your email program.”14 © 2010 ExactTarget
  14. 14. WAIT— THERE’S MORE! In Report 3 of SUBSCRIBERS, FANS, & FOLLOWERS, we’ll tackle our most ambitious research report to date. Although many marketers believe age, gender, and income are the primary factors driving how consumers interact online, our research suggests otherwise. Personality is actually the main factor that impacts how consumers interact online, and we’ve identified 13 distinct online personas that will help you truly get to know your audience—beyond age, gender, and income level—so you know how to successfully communicate with your target audiences. To automatically sign up to receive each report as it’s released, visit www.Ready to find your organization’s email x-factors? and select the opt-in button onVisit today. the download form. © 2010 ExactTarget 15
  15. 15. Email remains the critical foundation for yourinteractive marketing strategy. But you needa provider with state-of-the-art capabilities.ExactTarget powers billions of emails a monthand stores more than 60 terabytes of data, soeven at peak sending times, your mission-criticalmessages will always reach your customers.Not only is our software sophisticated—it’seasy to use. Our team of User Experienceprofessionals have created the most intuitiveinterface in the industry, so you’ll be able tospend less time executing your programs andmore time focused on overall strategy.Visit www.exacttarget.comto learn how we can meet your uniqueemail marketing needs. www. ExactTarget. com www. CoTweet. comThis document may not be copied without the prior written consent of ExactTarget. © 2010 ExactTarget.