|
That’s a significant marketing opportunity to be shuffling to the back burner. And yet, e-mail marketing experts note that most companies have yet to tap into the potential of their transaction-based e-mail messages.
“It’s always been the stepchild of commercial e-mail and viewed as a cost center,” says Jeanne Jennings, a Washington, D.C.-based online marketing consultant and publisher of e-mail marketing e-letter The Jennings Report. “But with a little bit of thought and investment, it can become a profit center.”
Developing Your Message Strategy
Like with any customer communication, marketers should start by thinking logically about what kinds of messaging could be shared with customers during transaction follow-ups.
The main categories of data used to develop the right message points consist of purchase history, life cycle and individual interests, says Ryan Deutsch, director of strategic services at StrongMail Systems, a Redwood City, Calif.-based e-mail infrastructure software provider.
The most prevalent type of promotional message in transaction-based e-mails is purchase-based. For example, says Deutsch, someone who buys a digital camera stands a good chance of being interested in a larger memory card for it. Amazon.com, he notes, is exceptional at this type of cross-sell and upsell activity.
On the life-cycle data front, marketers can tailor messages and offers based on simple aspects, such as a customer’s date of birth, or more complicated details, like the customer’s date of acquisition, first order and more, Deutsch explains.
The third category of data that drives message creation—and the most overlooked option, says Deutsch—is profile data. If customers share their favorite hobbies and interests, this information can provide marketers with fantastic opportunities to share educational content that will be of value to their audience.
Just as important as which types of data you gather to develop your promotion content is how you apply these insights. To ensure you’re truly adding value to your transactional e-mails, it’s important that you consider the spectrum of interaction a customer might have had with your company.
It’s all about engagement and dialogue, says Chris Baggott, CEO of Compendium Software, a blogging platform company in Indianapolis, and author of “Email Marketing By the Numbers.” He explains: “There are three ways to engage in dialogue with people: 1) I can meet you face to face; 2) I can talk to you on the telephone; or 3) I can develop a relationship with you over e-mail—which, with real human beings, happens all the time. Sometimes organizations forget about that.”
With that in mind, maybe the promotional offer developed for the transactional e-mail isn’t a second or third product to purchase, but an offer to help the customer better enjoy the product he just bought or an offer to listen to his feedback on how the product or buying experience could have been better, he notes.
While there is nothing wrong with making strong offers through transactional e-mail, companies also could recognize the value of their customers’ business with a free loyalty offer, or even just follow up on the quality of their service. “At the worst, it’s going to show customers that the companies they do business with care about them,” says Baggott.
When ‘Bacn’ Tastes Like Spam
Part and parcel of customer care is practicing restraint when it comes to going after your share of revenue made from transactional e-mail contact. As has always been the case with the e-mail channel, spam is in the eye of the beholder. So is “bacn,” the term that just recently took hold in the blogosphere and is being used to describe e-mails you probably want to read at some point but often never find the time to—e.g., MySpace add-a-friend invites, e-letters, shipping confirmations or account update requests. With some transactional e-mails falling into this category, marketers have to be careful not to ruin the very opportunity that shows the most promise.
Transactional messages historically have enjoyed higher open rates, says Jennings, but that might not be the situation if companies overdo it with their promotional add-ons.
Deutsch agrees: “My fear is that companies will get into transactional messaging without the integration points they need to get at the data [necessary for customization], which will result in generic offers in these e-mails. And that’s what will start to hurt the channel.” And with clickthrough rates of about 50 percent for transaction-oriented e-mails versus less than 8 percent for fully commercial messages, marketers stand to lose a great deal of opportunity.
Another factor to consider is that not all transaction-based e-mails lend themselves to the inclusion of promotional content. For example, says Jennings, e-mails regarding payment problems—a declined credit card, past due status, etc.—should not contain upsell or cross-sell offers.
A transactional message particular to financial institutions is a fraud alert. Deutsch says banks use them to notify customers when certain activity has occurred on their account that merits a review or call to the organization’s customer service center. “That’s not a great time to insert promotional messaging,” he says. Besides the fact that the customer is in the wrong frame of mind to entertain an offer, he or she also might be concerned your message is a phishing scam.
Other types of messages that don’t warrant inclusion of promotions include basic alert services, for example, flight delays or changes. “When I buy an upgrade on an airline and it’s sending me an upgrade confirmation, that’s a good time to include some promotional messaging as part of that transaction. But when I’m being alerted that my flight’s been delayed three and a half hours, it’s probably not a good idea to present me with an offer to buy tickets to Hawaii; I’m probably not in a buying state of mind,” Deutsch reasons.
Staying on the Right Side of the Law
“When it comes to compliance with CAN-SPAM, this legislation is still new enough that there’s not much case law,” Jennings explains. So, every lawyer has his or her interpretation of what constitutes “primary purpose” in an e-mail to define whether it’s transactional or commercial in nature.
Informal research that Jennings conducted to help her establish some working guidelines showed that for text messages, lawyers required the promotional content to be placed after the transactional details. But that means most recipients are never going to see this information, since they’re not likely to scroll all the way to the end of the e-mail. An HTML approach, says Jennings, offers more creative flexibility to display the promotional content as secondary to the transactional message but still make it attractive to the recipient.
Deutsch factors in a couple more best practices for avoiding legal quagmires. “First, the subject line of a transactional message has to be 100 percent transactional … The second thing relates to the proportion of transactional content versus promotional content. You have to keep the e-mail two-thirds transactional … leaving you 34 percent of the real estate for promotions.”
Execution Requires Access, Integration
If the secret to being successful with promotional and educational content in transaction e-mail is relevance, well, that’s the aspect tripping up direct marketers in every channel. Since the early days of direct marketing, companies have been talking about matching the right person with the right offer at the right time.
Jennings attests that one of the obstacles standing in marketers’ paths is access to the process of creating and dropping transactional e-mails. “Sometimes the IT department is handling this e-mail program, and other times it’s outsourced to the e-mail services provider,” she explains.
In addition, e-mail marketing data typically isn’t hooked into the operations side of the business that tracks purchase history and other points of customer contact. Deutsch explains, “Companies need a tool to connect the operational database and the marketing database, and allow them to communicate with their e-mail marketing and campaign management programs. Typically, the process a marketer has to follow is their team has to build some APIs and use some integration opportunities to allow those disparate data sources to communicate into a central e-mail marketing engine [for message deployment]. Then, after all this is done, that same e-mail marketing engine needs to put data—clickthroughs, opens, bounces—right back into both those data sources.” Needless to say, most companies aren’t overly excited to ramp up such a project on their own. Technology providers like StrongMail, Click Tactics and others are creating options to allow companies to solve their integration problems.
A different angle on the same obstacle is the likelihood that marketing teams don’t control the workflow for transaction-oriented e-mails, thus it’s hard for them to alter the program to accommodate promotional content. “The business has to make a decision to allow marketers not only access to the data, but [also] access to changing that text-only message to an HTML communication [for better response]. And the operational areas of the company need to understand this is going to make the business better, and it’s not going to freak out the consumer or mess with [the company’s] workflow,” says Deutsch.
One further point on the challenge of developing a more robust transaction e-mail program relates to performance measurement. “Often,” says Jennings, “companies are not tracking delivery at all or maybe just open and clickthrough rates.” So transaction messages don’t get the same attention that commercial marketing e-mails do and suffer as a result.
Deutsch also is baffled by this oversight. He points to research David Daniels at JupiterResearch and others have conducted to pinpoint the cost of nondelivery of such messages. “What’s happening is that every time a transactional message for an order confirmation doesn’t reach the recipient, it can generate a consumer call into the customer service center. That call costs somewhere between $1 and $3. So, you do the math and start to leverage simple things like tracking of delivery. The amount of money businesses can save from e-mail delivery optimization is staggering. That’s a side of taking transactional messaging more seriously that we see very few companies look at, but it’s actually a very large ROI opportunity.”
Companies Mentioned:
 |
|
Social Media ROI
Email Marketing that Works (2nd Edition)