E-commerce Link: Does Your List Measure Up?
As direct marketers, you know “the devil is in the details.” Being able to drill down on results is important to determine future strategies. Then you can fine-tune your results, target better and reap the rewards.
Give Your List an Annual Physical
It’s wise to make an appointment with your doctor for an annual physical. It’s just as important to determine the health of your list. Use your “churn” rate as one metric to assess your overall list fitness.
Picture a bucket with a leak. Once you determine how much fluid leaks out, you can determine how much additional liquid you’ll have to add to keep the level in the bucket even or increase capacity. With e-mail, the negative factors that reduce list size are opt-outs, hard bounces, soft bounces retired after a certain threshold is hit and spam complaints. The frequency of e-mail campaigns also affects churn. A monthly e-mail results in losses to your list size; campaigns that are sent twice weekly (or eight times a month) incur many more opportunities for churn.
To examine churn, you want to log the number of names you have at the start of a year and then plot, over time, the average patterns you’ve seen for each of the negative factors mentioned. Create a simple spreadsheet and chart this activity for a year, based on the frequency of your campaigns. This allows you to see how many new names must be added to stay steady or to increase your list by a factor that you set.
Examine Performance Attributes
Your e-mail database should be composed of multiple fields. Now may be the time to rethink the data you collect at sign-up and add additional fields.
Most e-mail systems allow you to run queries and analyze performance based upon the data fields that have been set up for the list. It takes preplanning to do this right. And there is no magic bullet. What is right for one marketer may not be practical to another. Consider the following:
• Maintain the source of each name. You might separately code site e-mail sign-ups, names collected from contests or sweepstakes, appended names, trade show leads, and more. Each source is likely to perform differently, so the addition of this field to your database should give you valuable insights. For example, you may find contests and sweepstakes as a source yields very low opens and clickthroughs, while e-mail addresses collected during checkout perform remarkably well. This allows you to fine-tune your marketing strategy and invest in efforts that yield the most responsive names.
• Look at other attributes collected at sign-up or added to your file from information in your offline centralized customer database. It is relatively easy to import information from your centralized data repository to your e-mail file. You might want to identify
customers, online buyers, leads, multi-buyers or those who purchase in multiple channels. Think about how valuable this information is in planning e-mail communications—you understand their past activities and can zero in on these patterns in your messaging.
• Study e-mail behavior. It’s important to identify those who have not opened or clicked on an e-mail in a certain period of time, so you can plan reactivation campaigns.
Campaign Analysis Ideas
Any good reporting system details the standard metrics. You want to analyze each campaign in terms of sent, delivered, bounces, total opens, total clickthroughs, opt-outs and new additions to your list (if you include a sign-up link within your e-mails). All calculations for activity should be based on delivered e-mails, not gross names sent. Some analytic approaches designed to give you additional insights include:
• Clicks to opens. This is a measure of how engaged recipients are with your messages. Given the assumption that someone has opened your message, it’s helpful to see how many of those who opened actually clicked through to your site.
Let’s say that your open rate is 20 percent and your clickthrough rate is 5 percent. The click-to-open rate is 25 percent (5 percent divided by 20 percent). As you examine the types of campaigns you send (new product announcements, discounts and sales, product ratings and reviews, etc.), you’re able to determine the averages for each type and see how well they stimulate engagement.
If certain types of campaigns stand out, you can drill down deeper in an attempt to figure out why.
• Clicks on primary links. There are likely to be many links in an e-mail campaign. If you just look at overall clickthrough results, you may miss a piece of the puzzle. Drill down further on clickthrough activity, and determine what your clickthrough rate is for primary, secondary and administrative links. This also may shed light on how well your template is working.
• Conversions. Marketers should measure how many of those who clicked through actually made a purchase. In the instance where a marketer wants recipients to register for a promotion, it is helpful to know what percentage of clickthroughs did so. Not all e-mail reporting systems are able to report specific site activity, but you can look at your Web analytics to determine the conversion rates.
• Revenue per thousand. Marketers who can track sales also can examine their campaigns to determine the revenue derived per thousand e-mails delivered.
• Product and revenue analysis. Determine which products or categories generate the highest revenues.
• Examine what approach works best. Many marketers use a mix of content e-mails and promotional e-mails.
We’ve just scratched the surface on some aspects of e-mail measurement. But these areas should serve you in good stead. If you take the time to analyze and look beyond aggregate results, you’ll be poised to better understand your list and create more successful campaigns.