Online Retailers Consider E-mail Marketing a High Priority
Eighty-eight percent of online retailers list e-mail as a high priority this year, largely as a tool to retain customers.
This was a key finding from The State of Retailing Online 2009: Marketing Report, the first of a three-part series of reports based on the State of Retailing Online 2009, the 12th annual Shop.org study conducted by Forrester Research.
The report also provided the following results about online retailers’ use of e-mail marketing:
- 71 percent of the 177 online retailers surveyed plan to send segmented e-mails to customers based on stated preferences or purchase data;
- 55 percent will use e-mails that highlight new product availability;
- 55 percent will use e-mails that extend invitations to participate in surveys or garner customer feedback; and
- 53 percent will use e-mails that feature online-only promotions.
Despite the focus on customer retention, many retailers — primarily those that use several channels to sell their merchandise — say their customer acquisition efforts will be higher this year than last year, according to the survey. But for those retailers that operate primarily online, customer retention is now critical.
Online retailers are also realistic about current challenges. Fifty-four percent of respondents expect overall retail growth to slow during the next 12 months, according to the report, and 57 percent acknowledge the economic slowdown is hurting their businesses’ bottom lines.
That said, online retailers are bullish about Web operations: Four out of five think the Web is better suited than other channels to withstand the recession, according to the report, and one-third said the downturn has enabled them to capture greater market share.
Online retailers also report that their conversion rates continue to hover between 3 percent and 3.5 percent, as they have for years.
Additional findings from the report include the following:
- 30 percent of online retailers are spending less than originally planned on Web retail operations this year;
- among online retailers cutting costs, 88 percent will scale back hiring and staffing plans, and 56 percent will spend less on search;
- 46 percent have no plans to cut back original budgets and will spend as planned on their Web businesses, while 24 percent said they'll spend more on their online businesses than originally planned; and
- companies planning to spend more will increase investments in several areas, including search (80 percent), e-mail (65 percent) and social marketing (60 percent).