According to MailChimp, e-commerce companies average a 16.87% open rate with their emails. This means that despite what some people might consider spam, almost 1 out of 5 of your customers will open emails they're receiving from your brand. Yet, when most companies think about improving the performance of their e-commerce email marketing, they ask questions such as: How can we design a better email template? How can we write more engaging subject lines? How can we create better copy within each email? There is no doubt that answering these questions correctly can bring about improvements in your e-commerce email marketing efforts. However, these questions overlook one of the most important aspects of email marketing: Who are you sending an email to and why should they care? By shifting your focus from the product (the email) to the user (the recipient), you can devise a much more effective foundation for your e-commerce email marketing efforts. This article will examine the process of creating an understanding of your customer and designing a campaign strategy that will more likely increase the success of your email marketing efforts.
Improving your e-commerce email marketing strategy requires shifting your mentality from having a 'list of emails' to a 'database of customer profiles'. We like to refer to this database as the Customer Hub. The profiles in this Customer Hub should aim to include as much information about your customer as possible, well beyond just their name and email address. Ideally you'd be able to identify every demographic data point and track every interaction the customer has with your brand across all of your marketing and sales channels. Accomplishing this is certainly an ambitious feat, but the end goal. Once we have a robust Customer Hub, then we can formulate more effective email marketing campaigns.
1) Selecting a Platform for Your Customer Hub
The first step in building out your Customer Hub requires that you select the right piece of technology. The right platform depends on many things, but most importantly the budget and the level of sophistication appropriate for your company. Below are four types of platforms ranked by general affordability and sophistication:
Traditional Email Marketing Platforms
For smaller companies who want to keep their email marketing strategy on the simpler side, many of the 'traditional' email marketing platforms such as MailChimp and Constant Contact have added features over the years that maintain their position as a potential Customer Hub. These platforms are typically used more for companies who send infrequent newsletters and don't utilize email to a high volume. However, they support the use of custom fields, tags and other profiling tools that could allow you to build out a foundational Customer Hub with information beyond just name and email.
Marketing Automation Platforms
You can consider marketing automation platforms as a traditional email marketing platform on steroids. These tools tend to add layers of additional functionality to a more newsletter-focused platform that make many of the strategies we're suggesting easier to execute. They support more robust customer profiles, automatic grouping of customers based on shared attributes and creating rule-based email sequences that automate much of what might be done manually by a more traditional platform. A few examples include Klaviyo and ExactTarget.
Customer Relationship Management Platforms
Customer relationship management platforms, or CRMs, are more typically used by companies with a dedicated, multi-step sales process as opposed to e-commerce companies. They have the core ability to track customer information with a variety of custom fields, but build on that with the concept of opportunities, sales forecasting, sales process stages, etc. In many instances using a CRM can be overkill for an e-commerce company, but some platforms are starting to modify their feature-set to be a better fit for e-commerce companies. A few examples include OroCRM and SalesForce.
Enterprise Business Management Suites
For larger companies seeking an all-in-one solution, many platforms have built what they call a 'Business Management Suite' that is intended to handle every aspect of your company's technology needs. These platforms combine marketing, sales and operations all into one global view promising a more real-time and accurate picture of your business. A few examples include NetSuite, Skubana and Microsoft Dynamics.
2) Connecting the Eco-System Around Your Customer Hub
Once you've selected and configured a platform to serve as your Customer Hub, the next step is to connect the other platforms within your 'ecosystem' to that central Customer Hub. Most e-commerce companies have at least three or four different customer-facing platforms that run their business. These platforms make up the eco-system around your Customer Hub and include everything from your shopping cart, to your support ticketing system to your order fulfillment platform. The best way to map out this ecosystem of platforms is to think through all of the various 'touch points' your customer has with your brand from their first interaction through fulfillment and any post-purchase interactions. We use the E-Commerce Customer Lifecycle as a framework for thinking through what these touch points might include.
Once you have your ecosystem of platforms mapped out, we'll then need to connect them directly with your Customer Hub so they're providing the right type of data. Sourcing data from third-party platforms can be tough depending on the level of access those platforms provide to outside channels. Generally you'll find data can be transmitted between platforms via one of the following methods:
Manual Data Reconciliation
Most platforms allow you to export your data as a CSV. Assuming this data uses the same 'unique identifier' for each customer (such as an email address), then you can likely import it into a separate platform. Platforms that do allow for bulk data import via a CSV often require it meets a specific templated format, but a little Excel love should be able to get your exported data into whatever format necessary.
Many platforms have launched their own 'marketplaces' of pre-builts apps, extensions, plugins and modules that allow you to 'instantly' integrate two platforms. In most instances you simply install an app, add some account access credentials and the app automates the data reconciliation between whatever platforms need to communicate. This is a quick way to get data from one platform to the other, but is often fairly restrictive in allowing you to customize how any of that data is communicated.
There are a few tools out there that act as 'global connectors' between different platforms and sync data in the same format as a pre-built app. Examples include IFTTT, Zapier and Wombat. These tools act as a bridge between one or more third-party platforms and help transmit data between each.
Custom API Integration
In instances where a more transmission of data is required, there is often the option of building a custom integration using the APIs of each platform. Depending on the extensiveness of those APIs, you can develop any sort of tool necessary to transmit data from one platform to the next.
3) Populating Your Customer Hub
Once we have our e-commerce eco-system properly connected and data able to sync up with our Customer Hub, we'll need to select what type of data is worth capturing. The most central concept to understand is that our Customer Hub requires some sort of singular identity to build a proper customer profile. The ideal identity is the customer email address as it's both unique as well as a direct communication channel once captured. When thinking about how you'll populate your Customer Hub, just think through how you'll be able to associate an identity with your visitor. The clearest methods of establishing that identity include the following:
- Customers making a purchase through the website.
- Customers registering for an account through the website.
- Customers subscribing to an email newsletter on the website.
- Customers filling out some sort of form on the website.
- Customers clicking a link in an email they received that drove them to the website.
Depending on the sophistication of the platform serving as your Customer Hub, you might be able to create a cookie in the user's browser and store them as a unique session that remains anonymous until they act in a way that provides their identity. Whether you're capturing their identity in a single session or later associating it with a cookie session, you'll want to consider the following questions as data to use in populating the profiles in your Customer Hub:
Customer Acquisition Channels
- What channel (i.e. SEO, paid, social, etc) drove them to your website originally?
- How are you handling multi-source attribution?
- What device are they using when engaging with your site?
- What location are they coming from?
On-Site Content Engagement
- Are they creating accounts on the website?
- Are they interacting with content such as commenting, sharing or downloading?
- Are they interacting with products such as adding them to their cart or to a wishlist?
- What products are the purchasing?
- Are they using discount codes?
- How much are they spending?
- Are they purchasing via any up-selling promotions?
Fulfillment and Support
- Are they submitting any support tickets?
- Are they logging into their account to check shipping status?
- Are they returning any products?
Referrals and Advocacy
- Are they referring other customers to the website?
- Are they reviewing products?
- Are they signing up for a loyalty program?
- Are they sharing their product experiences online?
4) Organize Customers into Groups and Segments
After we've begun populating individual customer profiles with data across their entire E-Commerce Customer Lifecycle, we'll want to start analyzing this data for potential patterns. The goal is to identify unique patterns and form groups of customers or segments within our Customer Hub that will then serve as the basis for our email campaigns going forward. This allows us to shift away from the wretched practice of 'blasting emails' to a giant unmanicured list and instead provide highly personalized and valuable content to the right customers at the right time.
There are potentially limitless ways by which you can segment your customers. It comes down to the amount of data you can use in identifying patterns and the amount of creativity you can employ in analyzing those patterns. In general, we find the following few segments a great place for most e-commerce companies to start:
The Prospective Customers segment includes all customers who have expressed some sort of interest in your brand but haven't yet made a purchase. They might be customers who've subscribed to your newsletter or those who have made it partially through checkout but in the end abandoned their carts. These customers often just need a little extra reminder or incentive to help take them 'across the finish line' and actually make their first purchase.
The Flight-Risk Customers segment includes all customers who have made a purchase in the past but have had limited engagement with your brand since. They might not have purchased for at least 90 days or perhaps purchased lower than the average order value. Assuming they did not have a negative experience with your brand, these customers represent a huge revenue in the opportunity as they often just need to be encouraged to come back and see what's new with your offerings.
The VIP Customers segment includes all customers who make frequent or high-value purchases. They have a strong affinity for you brand and tend to like the fact that they're highly loyal, an early adopter or just active in your specific community. Often these customers benefit more from notoriety and exclusivity than they do product discounts. They want to be first-to-know on new products and associated with the brand in any potential content or campaigns.
The Product-Focused Customers segment includes all customers who demonstrate a clear interest in a specific product category. Let's say you sell electronics and one group of customers always buys the latest tablet device that comes out. They're a perfect segment for targeted product recommendations of tablet accessories or news on the latest tablet releases. They generally want information and promotions that are more tied to their favorite product than anything else.
5) E-Commerce Email Marketing Campaigns
Once we've built out a few key customer segments, then we can begin creating specific campaigns targetted to each group. The best way to approach these campaigns is by asking the question, "What would this group of customers care about most?" Just by looking at the segments above, we can extract a few types of campaigns that will likely increase e-commerce email marketing performance:
Abandoned Cart Follow Up
One massive opportunity to boost revenue via e-commerce email marketing strategies is to send an abandoned cart email. These emails remind customers of a pending order they had an invite them to come back, immediately resume that cart and finish checking out. According to Econsultancy, 44.1% of all cart abandonment emails are opened with 29.9% of clicks leading to a purchase on the website. Clearly this is a great place to start your email marketing campaign efforts.
Product Category Notifications
As mentioned in the Product-Focused Customer segment, you'll want to promote the right products to the right customers based on their past buying behavior. If you add a new product to your store that somehow complements an existing product, see what customers have purchased that product and make a recommendation. An example might be an 'accessory product' to an electronic good a past customer purchased or an article of clothing that compliments another piece a past customer purchased. It takes a bit of creativity in picking the right relationships/associations between products, but once selected, email is an easy way to promote that relationship.
Product Review Request
For customers who have high engagement with your brand, encourage them to contribute by either reviewing a product directly on your website or sharing their experience via social media. Only a small percentage of customers are those that pro-actively review every product they purchase. Many others need to be reminded, if not incentivized to leave such as a review. Consider offering them opportunity to earn 'loyalty points' via programs such as Sweettooth that setup reward point systems based on specific customer actions.
There is one helpful thing to note when it comes to managing your campaigns. The first is that much of the work can be done for you depending on which piece of technology you selected to serve as your Customer Hub. Klaviyo, for instance, will automatically 're-segment' customers based on their interaction with your shopping cart. Let's say a customer who hasn't been to the site in a year makes a purchase. They will automatically be moved from the Flight-Risk Customers segment to a Recently-Purchased Customers segment. This ensures that your segments are as accurate as possible so you can continue sending the right offers at the right time.
Email is a vital part to the success of any e-commerce brand as can serve as a primary communication vehicle between company and customer. It's certainly worth exploring design enhancements that can be made to your email marketing templates such as those recommended by Digital Telepathy and Litmus, but don't overlook having a fundamental understanding of your customers through something like a Customer Hub.