E-Mail Campaign Management And Data

The vendor community has many suggestions for improving e-mail marketing campaign performance.

Data plays an important role in determining which version of an e-mail campaign a customer should receive. There are several different attributes that should be considered.

• Lifetime Purchase History. This is often the most important attribute in determining which version of an e-mail campaign a customer should receive. Marketers will categorize purchases by merchandise division, and use the merchandise divisions to determine which version of a e-mail campaign a customer receives.

• Most Recent Purchase. In many instances, what a customer purchased five years ago no longer has relevance to what a customer will purchase tomorrow. Consider giving more weight to recent orders, giving less weight to older orders. Some marketers give purchases in the past three months a weight of 1.00, purchases 4-12 months ago a weight of 0.50, purchases 13-24 months ago a weight of 0.25, and all older purchases a weight of 0.125. If you have a statistician, you'll delight her with the task of assigning these weights!

• Clickstream Data. What a customer looked at, especially in the past month, can be very relevant to determining which version of an e-mail a customer receives. Some marketers use shopping cart data, others categorize items viewed by merchandise division.

• User Preferences. At Nordstrom, we asked customers what type of e-mail the customer wants (mens, womens, petites, plus-size, sale, etc.). We balanced preferences with purchases, weighting each differently when determining which version of an e-mail a customer received.

• Demographics And Lifestyle Attributes. Traditional marketers like these factors. It can be easy to conceptualize a campaign for a 35-44 year old woman who owns a Lexus SUV. These attributes are often less powerful than the purchase history of a customer.

If you ever want to unite your marketing teams over a single idea, e-mail marketing is one place to do that. To execute an exceptional e-mail marketing program, with many targeted versions of an e-mail sent to different customers during one campaign, you'll want to leverage these folks:

• Catalog Marketers, who have excellent experience determining "who" receives versions of a catalog.
• Database Marketers, who have integrated data from all channels to provide a complete view of the customer.
• Web Analytics Gurus, who can help summarize clickstream data for the Database Marketing team.
• E-Mail Marketers, who oversee the entire process, are accountable for the end result, and manage vendor relationships, and understand the promotions/subject-line/template stuff that makes e-mail campaigns tick.
  
• Traditional Marketers can help with the creative presentation most likely to be effective with customers.
• Online Producers need to put the merchandise on the website, and make sure that landing pages work properly.

Sometimes all of the data nuances can become overwhelming. Performance can still be improved by simplifying the number of data dimensions, or by reducing the number of versions. Your e-mail delivery vendor may have the resources to help you with version assignment, if your budget provides you these opportunities.

Don't expect miracles from targeted e-mail versions. In reality, you have limited data for eighty percent of your e-mail file, so you won't do a great job of targeting to these folks. Among the top twenty percent of your e-mail file, these folks are so productive that many different versions of an e-mail campaign can work. If you can get a fifteen to thirty-five percent improvement in total campaign performance by targeting, you're well on your way to success.

Best Customers

There is an amazing difference between "new" forms of direct marketing (like paid search) and classic direct marketing.

Paid and natural search is all about intercepting a customer when the customer has a need. You don't necessarily know if this customer is your most loyal customer, or one who has never heard of your brand.

Classic direct marketing is all about "pushing" a message at a customer. And in order to get the best return on investment, it is perceived that it is best to "push" your message at "best customers".

Take your average multichannel retailer. If you believe in the old adage that "multichannel customers are your best customers", then your marketing efforts have to be focused on these individuals.

• If you are launching a new catalog title, you'll send it to this individual.
• If you are moving from one e-mail campaign per week to two e-mail campaigns per week, you'll want the new campaigns blasted to the best customers, giving them the best chance to succeed.
  
• If postage costs are chewing up your profits, you are unlikely to pull back spend among your best customers, who spend enough to offset increased costs.
• If you're having a store event, you'll want to notify your best customers about the event.
• If you're opening a new store, you'll want to notify the best online/catalog customers in that trade area about the new store.
  
• If you have a loyalty program, you want to reward your best customers, right?

In each situation, direct marketing activities are going to be focused on "targeting" best customers.

The majority of companies employ this type of strategy --- each marketing campaign is unique --- ignoring the targeting strategies being employed by future/concurrent/prior campaigns.

Is the "best" strategy one that focuses on "best customers"? We'll talk a bit about this topic this week. You are encouraged to offer your thoughts.

Mini-Catalogs and On-Demand Catalogs

I wonder how long it will be before retailers try out a concept that I call a "mini-catalog". This might be an eight page PDF document (see DMNews and their Outlook 2007 for a media-version of the concept), featuring a number of top-selling items. The objective of the mini-catalog is to get you to print it on your color printer, and then use it as a guide for your in-store shopping experience.

The mini-catalog could be downloaded via a weekly e-mail campaign, an RSS feed, or could be featured on a key landing page of the website. In addition, these "mini-catalogs" could be developed to improve natural search results.

Even better, the retailer could allow the customer to cobble together ten or twenty favorite items, which could be assembled into an on-demand catalog that the customer prints on their home or work printer. The on-demand catalog is just a fancy version of the shopping cart, a place customers store mechandise that they might be interested in purchasing at a later date.

The concept of the on-demand catalog is something that retailers and catalogers are bound to begin exploring in 2007 and 2008. The on-demand catalog allows the customer to assemble the products and services s/he is interested in. The multichannel retailer gets to identify items that are of interest to these highly engaged customers, and use that information to personalize e-mail, print and RSS campaigns.

Mini-Catalogs and On-Demand Catalogs. Expect to see multichannel retailers explore these ideas in 2007 and 2008.