Email is a bit of a special medium. Most people have got an email address that is unique to them, which makes it more in common with a mobile phone number than a postal address.
An email address is individual (most of the time) and it can be linked closely to the customer lifecycle using response data alongside RFM data. This lifecycle can be tracked, measured, anticipated and managed. Here are some ideas on how you can use the stages of the lifecycle to develop strategies that prolong the relationship with your customer and increase LTV.
What are the stages?
As you may have noticed, this knowledge of the customer is going to require customer data, allied to the email address. This might be a tough one, but the bottom line is you need this information to know what to send to the customer and when to send it. Generating sustainable revenue from an email list is going to require information about the customer, and in this piece, we will consider the objective for each of the stages of the lifecycle.
1/ Prospect
This is a tough one for email, as the channel was often abused by mass mailing of cold lists in an effort to generate revenue. Although this did work for a while, changes in the email environment led to severe deliverability problems for some mailers and the decline in the use of cold email lists in the B2C markets.
Irrespective of the methods used to drive traffic to the site, the first key element is data capture.
Objectives for data capture:
Obtain a clear and valid email address
Many mistakes are made in the data capture process and no matter how many field rules are put in place, a spelling mistake will create an invalid email address. One of the best ways to reduce the mistakes is to require that the email address is entered twice.
Obtain permission
There are a number of rules that surround gaining permission, which depend on the situation. You will need to ensure that your permission process is legal as well as making sure you make the most of the data capture process. The conversion rate between email address capture and permission is an important one. It’s no good having lots of emails on your base without the permission to market to them.
Get the email address early in any process
Gaining email permission early is very important. Without someone’s email address and their permission, you can’t market to them. Gaining the email permission early will allow you to follow up with an email if the customer fails to complete the process. This effectively gives you more chances to build a relationship and make sales. Without permission, you can’t do that.
Obtain as much relevant and useful data as possible
This can be a fine balancing act in a transactional process, where simplicity of process can have a measurable impact on the conversion rate. One way to achieve better data capture is on the confirmation page of the sale when the transaction has been completed. A few simple questions, allowing actionable segmentation in the future, will add immediate value to the data.
Break up the data capture stages
The first stage of any sign up or transactional process will generally be First Name, Surname, Email address, permission statement (this could be dependent on the data capture process of which further details are available from the DMA and ICO).
Once they submit this information, you have the means to communicate in the future even if they don’t go on to complete the registration or sales process any further. This allows the use of basket abandonment emails, which are important to ensure your basket conversion is optimised.
2/ Welcome
Registration
Once the data has been captured and the recipient is now on the data base, the next thing to do is to welcome them on board! It might seem obvious, but it is surprising how many programmes just add you to the email pot. One point to consider is they are obviously interested in your product or service. Therefore, if they have registered and not purchased, the objective for this segment should be conversion.
Offers based on pages visited or products viewed can be powerful at this point. Remember, as they are in the market at the moment you must use every opportunity to convert them. This is a key segment of people, time and effort spent crafting a welcome programme focusing on getting the first sale will quickly pay dividends.
First sale
They’ve made the leap of faith that has led to them to becoming a fully-fledged first time customer. Now it’s time to treat them as such, thank them for the sale, welcome them as a customer, and tell them you’ll be in touch to let them know of other great things they might want. It’s also a great time for those savvy marketers armed with information on next nearest products for cross sell.
It is surprising that often, the welcome email sent after a purchase is made, can in itself generate immediate extra revenue.
3/ Single buyer
These people already have a relationship with you. Email communication should always acknowledge this previous purchase and encourage the second purchase. Although this seems to make sense, how many email programmes use this information? This is one of the most difficult stages to properly manage. At this stage you don’t yet know how good a customer they might be or how often they will be repurchasing.
You don’t want to send them an email every week, if they only make one purchase a year. It might seem like you are doing a branding exercise, but using email to do this is like using a hot branding iron (and likely to be just as popular)!
This is where you need to start looking at the response data (opens, clicks and site visits) to give you a clue as to how active they are likely to be. Look at how recently they have opened and clicked an email. If they have stopped engaging with your communications, frequency could be the problem. Reduce the frequency of email communications for those who are not showing any intent to purchase. Your customers are going to be happier seeing you in the inbox, if your frequency of sending them email, more closely matches their level of interest.
4/ Multi Buyer
These are the multi purchasers, buying from you several times, and recently! They can be the most recent and frequent buyers of your product, and they will expect you to know and acknowledge that fact. Simply giving them a status that reflects this is a good starting point. Your loyal customers could be known as your VIP club or something similar to reflect their status.
Loyal
These customers love you. They like your products and services, they even like your emails! Using Engagement RFM models demonstrates there is a strong correlation between online engagement (visits, opens and clicks) and the revenue this group of people generate. If you are going to invest any money in clever segmentation and tailored content, this is the group that will show you the highest return. It’s far easier to keep a customer than trying to drag them back once they have gone to the competition.
5/ Dormant
These guys have gone in some way. Maybe they don’t open emails anymore, or they don’t visit your website anymore, or maybe they don’t buy your product anymore.
It doesn’t look good; but it is important to look at all the data before retiring the email address to the dead pot.
Ignoring emails, but still a live customer
Watch this one, they could simply be suffering from too much marketing attention, and have relegated the emails to the junk folder or a special folder that they will ignore anyway. Don’t say goodbye to a customer who is still buying from you. They may have started to use another email address, so allowing them to lie fallow for a month or two, then sending them an email with quality content or a strong offer might reactivate them.
For some businesses, it is financially viable to use another media such as Direct Mail or a call centre to contact high value customers to update the email address and reaffirm email permission.
Open and click emails, but are dormant customers
There are lots of reasons why someone might have stopped buying from you for now, but it should certainly not stop you from sending them emails, especially if they are activity opening and clicking them!
Look on each bit of email activity from a customer, as a positive vote, even if they are currently not buying from you. If they are still engaged with your communications, they are more likely to become a live customer again if they are ever in the market.
They have ignored emails for a long time, they are a lapsed customer
They’ve gone. You need to accept it and take it on the chin. Despite all the best intentions of your marketing efforts, they are just not interested in you anymore. It’s easy to spend time and effort for little or no return just to keep them on the data base.
Email database size is a meaningless KPI. The key KPI is the size of your database engaged with you via email, quality over quantity. So, let them go, don’t become the email equivalent of a stalker!