Looking ahead to 2016: A strategic role for email in strengthening relationships
As we enter 2016, it’s clear that rather than declining (as many might have expected), email marketing strengthened its standing as one of the most important channels for customer activation and relationship building.
In November 2015, email accounted for 20% of all online purchases for the month capping another strong year and actually increasing its share from 2014.
As retail shifts from transactional to relationship commerce, the importance of email to CRM teams is becoming more central. Whether it’s lifecycle or promotional emails, these customer touches are critical to deepening the connection between retailers and customers.
There are five primary reasons driving this trend.
- Customers overwhelmingly prefer email as their main point of contact. In a survey conducted by Marketing Sherpa, Seventy-two percent of consumers chose email when asked, “In which of the following ways, if any, would you prefer companies to communicate with you?” This preference points to some of email’s greatest assets. It’s mobility along with availability across platforms and devices make it the preferred means of contact for consumers. In addition, email marketing allows users to attend to marketing messages in their own time as opposed to social media or push notifications that often require more immediate action.
- Email marketing ROI is clear and strong. A study conducted by econsultancy.com found that 39% of marketers rate their ability to measure the ROI of the email marketing retention efforts as “good”, second only to paid search. Jetlore published an article earlier this year about methodologies for calculating email ROI. The ability to readily gauge the financial return of a marketing channel is a major advantage when determining budgets and strategy.
- Personalization and automation are making email marketing easier for businesses and more desirable for customers. Increasingly, marketers have the capabilities to deliver personalized shopping experiences straight to a customer’s inbox. These efforts have proven to be a major driver for the engagement in email marketing and increase the revenue efficiency of campaigns. Recently, a survey conducted by Experian found that personalized promotional mailings have 29% higher unique open rates and 41% higher unique click rates than non-personalized mailings.
- Email is an essential tool for recognizing existing customers and building their profiles. The foundation for effective personalization is robust profiles for customers. Most retailers (both e-commerce only and omnichannel) have low profile coverage for their customers and any personalization program needs to start with building profile coverage. Email is the most effective method for building profile data. Click here to learn more.
- For building long-term revenue, retention is more important than acquisition. As the consumers’ preferred marketing communication channel, email is the primary retention and re-engagement mechanism. Some of the critical e-commerce metrics like customer lifetime value, customer churn, and repeat revenue are all tied to customer engagement in email. As the chart below demonstrates, the most successful e-commerce businesses are really good at retaining customers and email is a big part of their success story.
Looking ahead - Email will increasingly become an essential component of Relationship Commerce
As a frequent customer touch channel, email plays a key role as a retailer invests in relationship commerce. Email touches existing customers more than any other channel and the only channel where the retailers influence the timing. The total sum of emails (promotional, lifecycle, transactional) that any customer interacts with is staggering. In a transactional commerce setting, these emails are designed with a short-term ‘get a sale’ mindset. In the emerging world of relationship commerce, email represents an opportunity to offer experiences that are engaging with a purpose toward building a long-term, high value relationship.