There’s a better way to increase email revenue. You need a strategy that works today and increases your future email sales potential.
If I had to name one digital marketing channel with the most wasted potential, it would be email marketing. Email has the greatest ability to unlock the power of customer data. But, ironically, it’s also the channel that is least likely to take advantage of that data. If you want to increase email revenue, you have to take a different approach.
How Most Marketers Try To Increase Email Revenue
Most email marketing advice focuses on improving the KPIs of your entire email file: how to increase deliverability, open rates and clickthrough rates. These tactics treat all of your email subscribers as if they’re the same person. But your email file is a microcosm of your customer file, and we know that no two customers are alike.
Pursuing broad strategies like send-time testing or subject line testing can yield results…but not the results you think. And those results may improve upstream KPIs while doing almost nothing to increase email revenue.
When you run a test that makes your open rates go up, what’s really happening? One of a few things: Your test could have succeeded at getting unengaged subscribers to open. Or it could have done such a good job at appealing to engaged subscribers that the results outshined apathy from non-engagers. Or, it could have truly appealed to everyone on your list.
Why does this matter? Because your email strategy–the way you treat your subscribers–has a direct impact on who signs up and who opens. And the subscribers who open, click and shop shape the definition of what “works” in your email program. So your actions become a self-fulfilling prophecy.
An Example Of Email Strategy Influencing The Nature Of The Email List
We all know a brand (or several) that sends out multiple emails per day, every day. The email content is often repetitive and rarely relevant. But the brand wouldn’t make all that effort if it didn’t appear to “work”.
You–a new subscriber with a weak connection to the brand–might find the deluge off-putting and opt out immediately. But there is a core audience of promo-hungry, email-loving die-hards who open all three messages each day and spend enough that the brand is afraid to back off.
The outcome? The die-hards continue shopping with enthusiasm while most new subscribers are alienated from the channel. The brand’s email tactics cultivate its email audience. It’s easy to measure last-click email revenue, but difficult to quantify the missed opportunity of the alienated subscribers.
This becomes dangerous when the brand tries to sell something that doesn’t appeal to their core email list. Email is no longer an effective channel. And if email drives a large percent of the brand’s revenue, the business may architect its assortment or pricing strategy based on the email file’s preferences, to potentially disastrous long-term results.
How To Increase Email Revenue By Treating Email As An Ecosystem
Email marketing has higher stakes than we thought, huh? There’s a better way to approach increasing email revenue. You need a strategy that keeps your options open and increases your future sales potential in the channel.
First, you need to group your email file into segments:
- New subscribers (signed up within the last 30 days)
- Low engagers/tuned out (anyone who hasn’t opened in the past 120 days)
- Super-engagers (anyone who has opened >50% of the email they received in the last 30 days, or clicked >25%)
- Everyone else
These segments mirror the phases in a subscriber’s lifecycle. Each segment has different preferences and needs. A subscriber who tuned you out won’t be receptive to receiving three emails per day. But you’ll miss out on revenue if you pull back on contacting your super-engagers.
How To Increase Email Revenue From New Subscribers
Your goal with new subscribers is to set them up for success. You don’t want to send so many emails that they disengage. Every message should be as entertaining, meaningful and impactful as possible.
You should keep new subscribers out of your main email marketing cadence for the first 30 days. You can select one or two messages per week from your main list, but only send content that you would be angry to miss out on. A sale announcement: yes. A new product launch: maybe. “Florals for spring”: definitely not.
What to send instead? You want to deepen the subscriber’s relationship with your brand. This is where the approach will differ between prospects and customers.
For customers, you can offer support and education about what they just purchased. You can also send other forms of content that reassure them that their purchase was a good decision. For subscribers, you want to create brand desirability. This is where the narrative behind your brand can really shine. Think of ways you can educate, entertain, or otherwise provide value.
At the end of 30 days you’ll know if the subscriber is a super-engager, an average engager, or has tuned you out.
How To Increase Email Revenue From Super-Engagers
Super-engagers love you, and they love email. This is the segment of your file that will be reliably generating the majority of your email revenue. You don’t want to alienate them, but you don’t want to lean on them entirely.
As a first step you’ll want to understand this segment’s preferences. Do they tend to purchase on sale or at full price? Do they prefer a certain product or category? Is there a certain style of email content that they respond to more than others?
Typically, what appears to “work” for the file at large is dictated by the preferences of the super-engagers. But that isn’t always the case, so it’s worth digging through the data to know for sure.
To maximize revenue from this segment you can give them more of what they want, but there is also a huge upside to implementing personalized elements into your strategy. It’s also worth testing what contact strategy is most effective when this segment demonstrates high purchase intent. You may convert more high engagers if you back off email when they display heavy site browse activity.
What To Do With Your Low Engagers
Low engagers have either given up on you completely or they are on the verge of doing so. You need to find out who sits in what bucket, and to do that you’ll need to remove this segment from your main marketing email cadence. Like the new subscribers, send them 1-2 messages per week with your most important content.
If your low engagers are “on the fence”, this reduced cadence will make it more likely that they pay attention to the messages you do send. You can mix in some custom messaging to get their attention–pattern-breaking formats, special offers, etc.
Some of your low engagers are seasonal shoppers who will only purchase during certain events. You have the option of shifting this group to a separate list that you’ll only mail during those events. You can also keep them in the main file at a very low mailing frequency.
There will be a segment of low engagers who have completely tuned you out, but are still subscribed for whatever reason. If a subscriber doesn’t open within a few months of implementing your new engagement strategy, remove them from the list. Then put an automated rule in place to remove unengaged subscribers after a set period of time.
What To Do With Everyone Else
There is always going to be a segment of your file who engages with your content, but not at the same rate as your super-engagers. You should work to make the messages you do send this group as relevant as possible. If this group contains customers, you should study their purchase preferences and contrast them with your super-engagers. Perhaps they have different interests.
In some cases reducing email frequency and increasing relevance will turn a middle-of-the-road subscriber into a super-engager. But this won’t happen to everyone, and you shouldn’t expect it to. This segment still plays an important role in generating revenue for your business.
But…This Sounds Really Hard
There are a few reasons that this approach hasn’t been widely adopted by email marketers:
- Many channel experts are unfamiliar with an audience-based approach.
- At first glance, this approach requires much more creative than the standard batch and blast email program.
- What if we need to email the entire list to make our revenue goal?
The first point is addressed by everything you’ve read up until this point. The second point is a valid concern, but you don’t need custom creative for each of the four segments listed. You can simply plan out your email calendar for the month, serve up the full calendar to super-engagers, and then pick and choose the messages you send to the lower touch segments.
New subscribers and subscribers at risk of churning do require some content of their own. But that can be developed in a single batch and implemented once.
The third point is very, very real. Most of us working in eCommerce have encountered the unpleasant situation where we hit mid-day and it’s obvious that actual sales are pacing way behind projections. If this happens during a tentpole sales event there will be tremendous pressure to email everyone, multiple times.
Situations like this are the genesis of “Surprise, we extended the sale!” tactics that very few consumers take seriously. And sometimes you simply have to do what you have to do. But every time you milk your email list for all it’s worth you are making it harder for yourself to succeed in the future. You can do this a few times, but when it becomes a pattern you actively destroy value in your email program.
If you want to escape this cycle, you need to create strong and clear boundaries about when and how often the business is allowed to blast the entire file. This becomes easier when you’re able to show others that email is an ecosystem and not simply a tree that you shake until money falls out.