Connecting with the Always Connected Customer

by Megan Ouellet, Director of Content Marketing. Reach out and say hi to Megan on LinkedIn.

We hosted the first of our two Customer Connections events in New York this week. It was filled with new ideas, best practices and strategies that will help retailers create a seamless shopping experience for their customers across multiple channels.

We’re starting to hear from some attendees and the feedback has been great:

“I was thrilled with all the presentations and had some great takeaways!”

“It was a good one, lots of good real-life examples shared.”

“Many thanks to the Listrak team for putting on such a wonderful and valuable event yesterday!”

If you are interested in attending Customer Connections West Feb. 11 in Newport Beach, a few tickets remain. Details and registration can be found here.

Morning Sessions Recap

The day began with Scott Lachut from PSFK Labs providing a look at where the retail industry is heading. Many retail stores are adding digital experiences that engage shoppers and help them transition seamlessly as they move from the store to their mobile devices. He provided 10 pillars retailers need in order to deliver the right experience. Here are some of the highlights:
  • Enhance the path to purchase by creating confidence to give customers the opportunity to explore and discover products while eliminating obstacles to save customers time and effort during checkout
  • Build better relationships by democratizing access – allow customers to experience things that were previously exclusive or expensive, personalizing messages and promoting transparency
  • Create a valuable community through perfect partnerships, optimizing ownership – educating consumers after a purchase is made - and cultivating an environment where customers can interact with one another to share experiences
  • Elevate your brand by encouraging advocacy and delivering delight – give customers more than they expect
You can learn more by downloading PSFK’s Future of Retail Report.

Next, Listrak’s CEO, Ross Kramer, shared how Listrak can help retailers achieve the goals Scott outlined. Listrak can help retailers connect with customers when and how they shop – in-store, online or on mobile devices and the key to success is through personalization and segmentation. After some selfies and a networking break that included mimosas, which were sponsored by Listrak’s partner UPS, the sessions were targeted and specific, providing actual strategies and tactics that retailers could implement right away.

Art Tschopp, the Director of Listrak’s west coast office, was up next talking about the importance of breaking down data silos in order to use all customer data to inform campaigns. He provided some stats showing that 62% of marketers feel overwhelmed by the volume of data they have and only 3% feel like they can use their data effectively. And while data is a difficult topic as it can get technical and overwhelming quickly, Art made it approachable and easy to understand by using a motorcycle analogy. He showed a video of a man jumping over a few cars on a motorcycle – a jump that was impressive back in the 80s but not so much today. In fact, one YouTube commenter stated that his grandmother could have made the same jump. He then showed a video of the world’s first motorcycle triple back flip with the comment “This. Was. Awesome.” What does that have to do with data? Everything. Retail marketers need to use their data to deliver delight, as Scott from PSFK mentioned. If they are simply jumping over a car – a “dead sailor” in motorcycle terms – by sending nothing but broadcast messages to every person on their list, the subscribers won’t be impressed. However, by using data in simple ways, such as personalizing subject lines with preferred brands or local store info, using preference center data to segment lists appropriately and getting even more granular by layering on browse and purchase history as well as behavioral data, retailers can achieve the triple backflip and really impress shoppers with targeted and personalized messaging.

Art also set up the rest of the day sharing how a shopper’s email address is the universal identifier and how retailers can tie a customer’s home and work computer, tablet and mobile phone to a single account simply by monitoring the shopper’s interaction on those devices. Doing so allows for all of the customer data to be used in future campaigns. For more information on cross-device targeting, check out our article “The Ultimate Personalization Tactic”.

Kara Surrena, Director of Client Services, rounded out the morning with everyone’s favorite topic – email marketing benchmarks and how to beat them. She shared that retailers spend the lowest amount on email marketing – approximately only 3.3% of their digital marketing budgets, but email has the highest return, bringing in nearly 25% of total revenue. Email returns $38 for every dollar spent, which is 40x higher than social marketing’s ROI. She reviewed specific benchmarks for a number of email campaigns, pointing out that welcome messages generate 18x more revenue than broadcast messages and online browse messages, cart abandonment campaigns and back in stock alerts generate 8x, 46x and 32x more revenue than broadcast messages, respectively. She spent time comparing the performance of a typical untargeted broadcast message with the much more personalized recurring automated campaign, showing retailers how they can save time and resources with the later.

Lunch was sponsored by Listrak’s partners Weblinc and Lyons. Both presented 30 minute lunch and learns to packed rooms.

Afternoon Sessions Recap

The afternoon started with Cherrill Hartman, an Account Manager at Listrak, presenting on how to acquire customers, not just subscribers. She walked through two shopper personas – the in-store shopper and the online shopper, offering information on how retailers can and should present an easy opt-in at every touchpoint. Cherrill then went on to talk about engaging new subscribers through thoughtful welcome series in order to get the first sale. She shared that 17% of all welcome messages are sent within five minutes of subscription when shoppers are still online and contemplating the purchase. She also shared some ideas on how to make the welcome messages personal and how to segment them by subscription point. A customer who opts-in through a modal lightbox should receive different messaging than customers who sign up during the checkout process.

Next, Ryan Ogurcak, Senior Account Manager at Listrak, talked in-depth about personalization, including best practices for using personal product recommendations onsite, in email messages and in display messages. He shared that of the contacts on a retailer’s list, only 30-40% have purchased and he discussed how personalizing messages based on shoppers’ past browse and purchase behaviors can nurture shoppers to the first sale. He offered ideas for personalizing broadcast messages as well as post purchase and winback campaigns, saying that 80% of customers are open to receiving more emails as long as the messages are personalized to their needs.

After another short networking break, which was sponsored by ECommerce Partners, Account Manager Matt Lindley tackled the topic of retention. He shared a MarketingSherpa study showing that 67% of retailers say that delivering highly relevant content is a priority but only 49% want to segment their databases and then offered easy segmentation tactics that anyone could implement right away. The first thing retailers should do is send the same message to two different segments, such as customers who have and haven’t purchased. This way they can see how the two segments react. He then shared how all subscribers fall into one of four categories: new subscribers (signed up within 30 days), active subscribers (subscribers who opened, clicked and/or purchased within 60 days), lapsing subscribers (haven’t opened within 90 days), and inactive subscribers (haven’t opened within 120 days), and suggested sending slightly different versions of messages to those four segments. Doing so can greatly impact the amount of revenue driven through the campaigns and it doesn’t require a lot of time or extra resources or data mining. He then shared a Listrak case study on BrainMD Health and how they’re segmenting their list using browse and purchase history, subscription date and other email metrics. They more targeted you can get, the higher the emails perform.

The final session of the day was led by Product Manager Aaron Pearson. The morning started off with The Future of Email and ended with The Future of Email. Aaron discussed highlights of 2015, including automated and personalized cross-channel campaigns, how more than half of all emails are now opened on mobile devices and how more inboxes are supporting responsive design. He then offered a number of email examples on both graceful degradation and progressive enhancement – he has a great blog post on the topic “Inbox Wars: The Email Awakens”. He ended a great day with real examples of how retailers are designing not just for inboxes but to drive shoppers back to sites to complete purchases.

The rules of digital marketing have changed and retailers need to respond to customers. If they aren’t delivering the right experiences, customers will shop elsewhere. This day-long event offered up a ton of new ideas on how retailers can deliver the right experience to the always connected customer.

Customer Connections: Be Better than the Benchmark

by Megan Ouellet, Director of Content Marketing. Reach out and say hi to Megan on LinkedIn.

At Listrak, we believe in helping you beat your industry benchmarks. And you do that by carefully monitoring your results to first set your own benchmarks and then by split-testing everything to optimize campaigns for performance.

If you’re planning to attend our Customer Connections East event in New York on Feb. 2 or the event in Newport Beach on Feb. 11, you’ll hear Kara Surrena, our Director of Client Services, share benchmarks and split-testing ideas. But for those of you who cannot attend, here are some things to keep in mind.

About Split-Testing
Split testing email campaigns has been around almost as long as email itself. Marketers would send out the same email with two different subject lines to see which one had the most opens or they'd send two versions of the same message with different images or calls-to-action to see which one had the most clicks. And they learned important lessons from these tests, such as keeping CTAs above the fold and putting key messages at the beginning of the subject line. But, like every other email campaign aspect, if you haven't updated your A/B split tests lately, it's time to take another look. We’re in a scrolling society, so above the fold isn’t really a factor anymore. And subject line best practices have changed a great deal with more people opening emails on mobile devices. What was once a tried and true best practice isn’t necessarily still what works best. So test to find out what is.

Set Goals
The goal of your split tests shouldn't be short sighted. You're not just trying to figure out what works best for a single email campaign. You should be trying to gather customer insights that you can use to drive business decisions and inform future campaigns. That means that email A/B split tests should be part of your campaign development process and not an afterthought you add in moments before you hit the send button. And you must start with a strong hypothesis. Put aside your feelings and approach it scientifically.

Forming a Hypothesis
  • Standard Hypothesis = If variable, then result. Include your rationale.
  • Weak Hypothesis = If we send messages over the weekend, then we'll sell more.
  • Strong Hypothesis = If we add an email deployment on Sunday, then we'll sell more merchandise. 

Our average email conversion rate is 7.6%. If we send more messages each week, we have more chances of converting customers.

The more specific you are, the stronger your email A/B split tests will be. Ask yourself the following questions before deciding upon your test criteria:
  • Specifically, what are you trying to learn?
  • What are your assumptions?
  • What variants will you test?
  • Are the changes big enough to truly make an impact?
  • Will the tests lead to improved results?
  • How will you measure the results?
  • Can you re-use the results to inform future campaigns?
  • Will the results answer your hypothesis?

Remember, even if your initial assumptions are proven to be incorrect, the test is successful as long as you learned something that will go on to improve campaign performance.

Split Testing Mistakes to Avoid
Setting up email A/B split tests is easy and you have the initial results in a matter of hours. But the strategy behind the split tests is complex and should be well thought out or else you could end up with a lot of data but very little context. Avoid these pitfalls:
  • Don't change important branding elements – if your brand uses specific colors, fonts, messaging or different elements, going off-brand is a mistake. Only test elements that make sense.
  • Make sure your sample group has statistical significance – if you aren't doing a true A/B split test where half of your list receives one version and the other half receives the second version, your sample group must be large enough to provide definitive results.
  • Don't call tests too early – Clients are always curious how long to run tests. While email provides almost instant results, calling tests after just a few hours could cause misleading results. For accuracy, allow tests to run at least 24 hours. Similarly, a single test simply isn't enough data, you must continue to run tests and measure the results over time. 
  • Measure the right results – make sure that the metrics you use to determine the test winner match what you're actually testing. If you're testing two subject lines, look at the open rate. If you're testing a call-to-action, monitor click-throughs. If you're testing offers or send times, measure the conversion rates. Different variables only influence certain behaviors. With that being said, it is always a good idea to look at the conversion rates of the tests. We've found circumstances where the email with the highest open or click-through rate had a lower conversion rate. While the variable being tested might not have influenced the purchases, you can learn a lot about the customer segment through this metric.

Email Split Testing Ideas
Testing subject lines and CTAs is a great place to start, but you can test nearly every aspect of your email campaign. Here are some additional ideas to try:
  • Personalization: Wondering if it is better to recommend your top selling or top trending products or merchandise that is personally recommended for each shopper based on his or her browse and purchase history? Test it! 
  • From name: You most likely – and rightly - use your company as the From Name in your campaigns. But certain campaigns, such as shopping cart remarketing or transactional messages, could work better coming from your customer service department. We've seen variations such as "Company Name – Customer Service", "" or simply "Customer Care" – the key is to test to see if you get a boost. 
  • Responsive design: More than half of all emails are opened on mobile devices and more and more customers are shopping on tablets and smartphones, so emails should be mobile-optimized. Even if your site isn't responsive yet, try testing responsive emails to see if the boost in conversions provides a business case for building a responsive website. 
  • Timing: The only way to know for sure what day and what time of day you should send emails is to test. You aren't limited to sending emails Mon through Friday between 8 am and 5 pm. Set tests to deploy on nights and weekends to see what happens! 
  • Number of emails: Many retailers are sending 5-7 – or more! – emails per week. If you are still sending only one or two, run a test where you send emails daily for a few weeks. You will be surprised at the additional revenue gained when you increase your deployment schedule. 
  • Bar codes: Email drives sales, not just online but in-store as well. Including a bar code and image that looks like a coupon that customers can print and take into stores with them could drive additional traffic to your stores. It's definitely worth testing to find out. 
  • Number of products: Customers will scroll through emails that contain row after row of product images, especially if those products are personal product recommendations based on browse or purchase history. But testing these message templates will help you figure out the optimal number of products. That way, you'll know for sure how many products drive sales and where the cutoff point is. 
  • Navigation: The majority of retail emails still include site navigation at the top of the message, which can certainly help drive clicks but also takes up prime email real estate while distracting from the main message. Try running a test to see if it makes sense to keep the navigation bar in the message or if using a simpler version – or no navigation at all – makes more sense. 
  • Ratings and reviews: Social proof is a great selling tool and it can really boost sales when included in messages. If it makes sense for your brand, try testing the concept to see if it leads to an increase in revenue. 

Questions about testing? Or, did you run a great test and want to share the results? We'd love to hear from you!

Q4 vs. Q3 2015 Retail Email Campaign Metrics

By Donna Fulmer, Market Research and Media Communications Manager

 Once again we’ve gathered Listrak’s global retail email campaign metrics for the recently completed quarter and compared them to the metrics from the quarter prior.  Although the numbers represent all Listrak clients from across a wide array of verticals, many of whom may not be considered holiday-sensitive retailers, it’s always especially interesting to see how campaigns performed in Q4 - the months during which email volume and online shopping are at their peaks.

Here are my thoughts on what we’re seeing:

Open Rates 

Notable: The only campaigns that enjoyed higher open rates vs. Q3 were Recurring Automated Campaigns and Welcome Series emails.

Insights: Opens obviously suffer in general when inboxes are fuller than ever; however, subscribers may have been especially eager to open Recurring Automated Campaigns because they contain highly personalized, up-to-the minute product recommendations based on each individual’s most recent activity, making them particularly helpful to busy shoppers.

Welcome Series messages, which see some of the highest open rates year-round, may have also been especially popular in Q4 because many shoppers subscribe to new lists during the holiday shopping season and are eager to take advantage of sign-up incentives.  

Conversion Rates

Notable:  All campaigns in Q4 had increased conversion rates vs. Q3 except Recurring Automated Campaigns, Post Purchase and Shopping Cart Abandonment Emails.

Insights: We all know that email in general is the workhorse of all digital marketing channels, so it stands to reason that conversions would be up in general during the year’s busiest online shopping months.

Recurring Automated Campaigns, however, may not have converted as well because they are often used as a time- and cost-effective way for retailers to present full-price products, and holiday shoppers have been trained to respond to deep holiday discounts.

The dip in conversion rates for Post Purchase emails might be explained by the fact that this metric includes not only loyalty emails that follow soon after a purchase, but also those that are typically sent 30, 60, etc. days post purchase based on what the subscriber most likely bought for him or herself. In Q4, however, many shoppers are looking to purchase for others, so these messages may seem less relevant.

Likewise it is not surprising that Shopping Cart Abandonment email conversions were down slightly, as there is much more abandonment activity when traffic is high, and shoppers tend to put items in carts with less intention to purchase during the hectic shopping season.

Average Order Value and Revenue Per Email Sent
In addition, we look at the global AOV and revenue per email sent for our retailer’s email campaigns:  

In Q4, as you can see, campaign winners and losers were pretty even for both, and, to be honest, nothing stands out to me that would truly explain the metrics. There is not doubt, however, that Q4 is a pivotal quarter for retailers.

In fact, as I was finishing up this post, I came upon a very interesting report from RJMetrics, The Ecommerce Holiday Customer Benchmark, which sheds some light on just how important the quarter is for online retailers. RJMetrics reports for example:

  • Retailers acquire 20-59% more customers during holiday months, and the percentage can be even more for holiday-sensitive retail categories
  • 39% of holiday shoppers who make a second purchase with a retailer do so in the same holiday season
  •  Holiday-sensitive retail categories generate 24% of their annual revenue from holiday customers

What did you see in your business this holiday season? If you have any insights, we’d be eager to hear them.