Sky News Producer and Data Directive litigation Troll Roddy Mansfield has apparently won his 3rd “victory” against a brand – in this case John Lewis, who (soft) opted-him-in for marketing by using a pre-ticked consent box after he had registered his details with John Lewis’ website.
This was breathlessly reported on Sky News as “Spammer To Pay Damages After Court Victory,” Roddy – the spam troll argued that “an opportunity to opt-out that is not taken is simply that. It does not convert to automatic consent” Well he would know that! Given his track record one would think he more than anyone else in the UK would know what that pre-checked box meant.
The irony of it all is Sky his own employers operate an enforced opt-in policy which means anyone who registers for a Sky ID is automatically put on their mailing list whether they want it or not and the only way to prevent that happening is to tick a box and actively opt-out. Interestingly they do it the opposite way to John Lewis and most brands as you can see below and their approach is as good an example of psychological sleight of hand as you are likely to see. To add insult to injury Sky would seem to be opting you into receiving 3rd party offers from brands you may not actually ever want to hear from, something John Lewis do not.
One of the challenges with the 2003 EU Directive is that it is open to interpretation and as such many Experts, Brands and even Countries apply it in different ways. I have no doubt that Sky’s lawyers are pretty certain that their interpretation stands muster, but I know many brands and commentators who would not feel uncomfortable with their approach and might argue that consent for 3rd party mailings should not or cannot be via opt-out. Most websites require registrants to explicitly opt-in to receive 3rd party mailings.
So what does this mean to those of you out there who concerned by this ruling? My understanding is that County Courts have no power to set legal precedent and as such you are free to use a pre-checked box, particularly as it is one of the most widely accepted interpretations of the Directive. My guess is that John Lewis could have appealed and most likely succeeded, but decided it would be cheaper to pay up and move on. Which is precisely why it is so difficult to stop litigation trolls using the small claims courts as a handy way to top up their holiday fund by suing large employers and brands.
So if there are any other people like Roddy out there go register with Sky and fill your boots!
Our findings last month on the Obama campaign caused a lot of debate but the bare facts of our analysis still stand – had Obama’s team optimized for improved open rates, their send volumes would have dropped and their all-important donations would have followed.
Open rates remain a widely used and hugely misleading measure of performance and engagement in the email industry. At best they give you an idea of a campaign’s performance in isolation but at worst they lead email marketers to focus on optimizing the wrong strategies for their email program.
Here we discuss how to identify if maximizing open rates is holding you back and how to go about identifying the strategies that will have the biggest impact on your results.
The open rate paradox
Using EDS Analyst we examined the relationship between open rates and total unique opens for the top 200 email senders by list size in the US for 2012.
We were confident that, like the Obama campaign, there would be an inverse relationship between rates and totals – so as rates increase, totals decrease and vice versa. We call this the open rate paradox or to paraphrase a popular sports trusim: rates are for show, totals are for dough.
Each dot on the graph below represents a single sender and we picked out some well-known brands as reference points.
Sure enough, the graph shows that for most large senders, there is an inverse relationship between open rates and the total number of opens – the higher the open rate, the lower the number of total opens. Rates are for show.
It’s also no coincidence that nearly all of the brands with the biggest lists (orange dots) also have highest number of total opens because they are sending more opportunities to open.
Although opens don’t directly correlate to revenue, even the most avid fans of open rate maximization would agree that the more people that actually open your emails, the more engaged your database and the more revenue or conversions you are likely to generate. Totals are for dough.
Keep it simple – focus on just three strategies
If your goal is only to improve open rates, then your strategy is simple: halve your list by suppressing your less active subscribers and watch those rates soar… and those total opens plummet! But if your goal is to increase total opens, then the bell curve in the graph above helps define three clear strategies:
Has the biggest impact on totals and can be improved independently of the other two.
Increase send volume: Significantly increases total opens for relatively little effort (low effort to gain ratio).
Optimize for rates
Increases total opens but requires the biggest effort (high effort to gain ratio).
Most brands are clustered towards the lower middle of the curve because it’s the easy place to be. By and large, they all put a similar amount of effort into their program and use the same undefined strategies.
The outliers, however, go above and beyond in one of three ways – those to the right have very high open rates, those to the left have high send volumes and those at the top are combining high send frequency with very big lists to produce massive send volumes.
In effect, this is the three different strategies implemented to their extremes.
Of course, there are limits to the effectiveness of each strategy and these are defined in the graph above by the orange line to the left (frequency cap) and green line to the right (optimization cap).
These boundaries exist because for any given list size there is point at which diminishing returns kick in for both frequency and open rate. And, as the big empty space to the right of the green optimization cap shows, it’s very hard to send a large volume of email while still achieving a high open rate.
So the basis of a successful email program is to continually grow your list while finding a balance between increasing send volume and maximizing open rates with better offers, targeting, subject lines, etc.
And you find that balance by ignoring your open rates…
Define your strategy by ignoring open rates
To illustrate the effect these strategies have on an email program, we have created a simple optimization chart, below. The green curves represent the impact of send volume on total opens and the brown lines represent the impact of open rate on total opens.
Each intersection represents a hypothetical 10-hour unit of resource, as a means of comparing the effort required to implement each strategy. As you get closer to each cap, the effort required to improve your totals with your chosen strategy increases exponentially.
Imagine your brand is the star in the middle of the curve and you want to take on your leading competitor, the lightning bolt.
If you use open rates to define your strategy, then you focus your resource on maximizing those, route A. Your open rate may now be much better than your competitor’s but they are out-mailing you, so they are still creating twice as many opportunities to buy or convert.
If you choose to increase your send volume, ‘route B’, then your open rate drops but your total opens more than double. However, as you approach the frequency cap, the impact of your strategy diminishes and you still trail your competitor.
If you use totals to define your strategy, then you take ‘route C’, which balances resource between increasing send volume and maximizing open rates. Your open rate drops but you are finally creating more opportunities to buy than your competitor.
Smart email marketing is not just a case of increasing send volume indiscriminately or of only focusing on ever tighter targeting. There is a balance that exists for each brand, you just have to find your own sweet spot.
Total opens the key to optimizing your program?
In this instance, we have highlighted the open rate paradox using total opens because that was the data available. However, we’re confident you will find the same inverse relationship in your own campaigns with total clicks and, more importantly, revenue. And in the end that’s the only metric that matters!
What can you learn from your competitors? When it comes to email marketing I’ve been analysing the habits of the top 100 online UK retailers to understand what common good habits they have that enables them to get the best value from email marketing.
All email marketing has to start with an email address. If you’ve nobody to talk to the best message in the world won’t work. So gaining and maintaining a quantity of quality data is a fundamental building block for all successful email marketing.
One of the best places to collect email permission is on your website. I analysed where on the page the subscribe form was placed. The following heat map illustrates the most common locations.
Top right is the best location to maximise sign-ups. It’s where consumers are used to seeing the sign-up and its immediate presence as soon as a visitor comes to the page means it’s going to be seen and increase the number of subscribers you gain.
This is of course prime real estate on your webpages and use of the space will be competing with other marketing objectives. You need to decide on what the smallest, easiest and logical first step a visitor to your website can be persuaded to make in their customer journey.
As the heatmap shows, locating the subscribe form at the bottom of the page is also very popular amongst top brands. Having the form here can work for those visitors who whilst not ready purchase, have engaged with your content and scrolled through the page and are interested enough in your brand to know more and thus subscribe to your email programme.
Looking to maximise signups? The location is not an either or question, use top right and page bottom for best coverage.
This goes further too. The brands that are most successful in building their permission email database integrate collection of email addresses in multiple places and channels. The more often you ask for an email address the more often you’ll collect one. Work through all touch points you have, such as:
Recommend a friend
Offline touch points, printed materials
In all cases giving a good reason for someone to hand over their email address makes the difference between good and great list growth. For example, these are not reasons for someone to subscribe:
Join our list
Get our newsletter
Subscribe to our emails
Whereas using free, win, save type incentives are reasons, such as:
I recently attended the DMA’s Email Customer Lifecycle Breakfast Briefing with sponsors Silverpop and came away with some refreshing ideas about how to grow email lists. Working in sponsorship, accessing a list/audience is one of the vital benefits within a sponsorship proposal. Most often, the audience has not opted in to receive 3rd party communications; however, it is perfectly acceptable and the norm to incorporate sponsor branding within the sponsored event communications. Options on how to do this successfully were in my last blog Email Newsletter Sponsorship: Who is Getting it Right?
However, badging logos to an email is not always the best way to organically grow your list through sponsorship within eNewsletters. More integrated approaches can be taken if both parties are flexible, which can create a more engaging relationship with the customer you are trying to reach.
Case Study: A Small World & Boujis
A Small World is similar to a private members online network where the audience is fairly exclusive and difficult to access. By invite only, a Small World has generated a unique and large enough audience that can become an attractive partner for luxury brands. Typically this has been done through display advertising. However, more recently there has been an increase in jointly supported events that are supported by communications sent by both partners to their respective database. The most recent partner through A Small World’s email newsletter promoting an event with Boujis – a nightclub located in London.
This email was sent by A Small World to their London members. By avoiding looking overtly commercial and sending communications which the audience has not agreed to receiving, A Small World has promoted their own event showcasing Boujis in the format and copy of the email. When tickets are reserved, guests are then asked whether they’d like to receive communications and similar invitations to events held with Boujis. This provides benefit to both parties – enhancing both the A Small World member experience through an exclusive invite specific to their city of residence as well as providing an exclusive audience for Boujis to build brand awareness and showcase their venue to.
In terms of using sponsorship for list growth, this is a great example illustrating how to grow your list organically through a partner – avoiding purchase or rental of data lists. Instead of spending the money trying to jump start building a new list of customers, Boujis have wisely spent the money in a tailored sponsorship opportunity. This not only provides them organic list growth, but also alignment with a trusted brand and a tangible event attracting new customers.
I can’t wait for more inspiration and email marketing tips at the second session in the Email Customer Lifecycle sponsored Silverpop on Conversion, 12 July 2011. Free to all DMA members, book early to avoid disappointment by emailing Amelia.Bingham@dma.org.uk
After the email council has spent hours in the DMA offices at the monthly council meetings there is occasionally the need to move across the road to the pub where discussions (both email and non email related) can be quite interesting. One topic that came up is how quickly email marketing is still evolving. However it was also noted that some key fundamentals stay basically the same. The article below was first published in the DMA newsletters in 2008 (a million years ago in the land of digital) However nearly all the points still stand today.
When aiming to grow your email database.
1. Only collect people who want to hear from you and will be valuable to you.
2. Utilise all your own internal sources both on and offline to collect data (a recent addition to this is to also maximise all social media for this purpose).
3. When considering Third party data capture or third party list rental only use reputable companies, check the legal bits are in place and test test test.
4. Remember to track return on investment appropriately. The graph in the article below can be adapted to any campaign testing and is so simple but will give you an indication of when you will get the money back you have paid out.
The DMA legal and best practice hub is in the process of publishing a series of White Papers with useful info on all areas relating to Email marketing. I have been working on the white paper for 3rd party lead generation and 3rd party List rental and all the content is brand new and bang up to date. The only historic bit of information that might sneak in is the graph below and the explanation of what you need to consider when collecting data in terms of return on investment and what you need to monitor.
Is this information (from 2008) still relevant or are there different things in 2011 that we need to be considering? -
Third party data capture or third party list rental
Once you are maximising your own customer and prospect data (gathered from your website) then the next step is to look at how to utilise other data to get the full benefit from your email marketing strategy. In order to do this effectively you need to make sure you:
1. Are clear on the target audience; who do you want to receive your email. Look at the profile of your existing client base in relation to what you are promoting in order to ascertain this.
2. Have a clear communication strategy. Are you just promoting your product or service on emails; will the same message be reflected in other marketing mediums; or will the email be followed up by a phone call? In most cases the marketing message you send to your new prospects needs to be different to the one you send to your own customers.
3. Be clear on what you are monitoring. Don’t make the mistake of just looking at the number of people who open or click on the email – the monitoring needs to be related to your key business aims. E.g. people who purchase something or are active on the areas of the website where you need them to be active.
4. Always follow the DMA best practice guidelines (www.dma.org.uk/bpg) and be fully aware of where the data you are using has come from, how it has been collected and that the data owners’ privacy policies and data collection statements are clear and legal.
Two of the most effective ways of expanding email marketing from simply using your own data to using third party data are List Rental and Data Capture:
1. List rental – where you send a one off mailing (or if agreed a series of emails) to a selection of people who have given permission on another company’s website to receive emails from selected third parties. This is typically priced at a cost per thousand (CPM).
2. Third party Data Acquisition – where individuals give their details and sign up to become a member of your company’s mailings on a third party’s website or through an off line medium. This is normally priced at a cost per record where the price will vary depending on the amount of information you require, what the user is signing up for and what criteria of people you want to make the offer to.
Which one to use?
There are several factors which will determine which option will work best for your company. Including:
• What your key business aims are
• The type of product or service you are selling
• How regularly you intend to communicate with your prospects/customers.
• How quickly you need any marketing activity to pay for itself
As long as the data you use is of the same quality, a small test for third party list rental will quickly give you an accurate indication of your basic cost per sale (remember to also take into account the additional longer term benefits of brand awareness and increased impacts on other advertising mediums).
Data acquisition has a higher upfront cost but the returns continue over a longer period of time as you can communicate with the individual on more than one occasion. If you continue to make the marketing message effective and the volume and timing of the email sends appropriate, then you will continue to see a more intense return on investment over a longer period of time.
The chart below is based on a (theoretical) company who pay £80 per thousand for list rental and £1 per record for data acquisition. With open rates of 30%, bounce rate of 1% and a conversation rate of 2%. They are emailing the data acquisition customers weekly.
This shows that the cost per sale from list rental is £40 per thousand. The cost per sale from data acquisition starts above a £100 but by week 14 has decreased to £61, and at week 25 it crosses the line with list rental at £40 per thousand. By the end of the year the cost per sale has dropped to below £20.
This hypothetical example shows that data acquisition incurs a higher upfront cost which takes a longer time to pay for itself, however over a longer period of time the value is greater.
This means that some companies, particularly those which need a quick return on investment or where the product or service will be either relevant to an individual or not (and this will not change over time), will be better off using list rental. When using list rental, make sure that the landing page you are sending the recipient to has a clear option to sign up to receive more information from you even if they don’t want what you have to offer right now.
For other companies where the return does not need to be so immediate and customers are more likely to buy into the product or service once a relationship is built up, data acquisition is going to be more effective.
In many cases both methods will work for a company if the targeting and creative are correct. The best thing to do when getting started is to run small tests of both list rental and data acquisition, and continually monitor the return on investment by looking at both the source and type of data. This will help to not only determine which method works best for you but will also help to continually improve the campaigns, thus maximising revenue and profit
This week I have watched with interest as one of my colleagues on the Email Marketing Council asked a discussion board about innovation in email. So far the group has remained fairly quiet.
So when it came to writing this blog piece I thought I would challenge myself to come up with some innovative ideas that you might want to apply to your existing email program. This is definitely outside of my comfort zone as I always like to make recommendations that are backed up by cold hard facts and metrics but here goes…
Innovate your email program
1. In the retail sector, how about sending emails out to let recipients know that their local store no longer has a product in stock but it can still be ordered online if they are quick. This could be based on products they have browsed for previously. This would have been very useful for me just before the Christmas period!
2. Depending on the products you sell and the time of year, it might also be an interesting idea to revise the online check out process and ask if the product is being purchased as a gift. If it is, why not use “Send to a Friend” functionality to send the recipient of the gift information / instructions about their present. This not only adds value but also helps you to collect data on the end customer.
3. In the hospitality sector why not collect data on all attendees at the event rather than just the organiser. In this way you can quickly grow your email database and send targeted emails to gather information on food choice and post event feedback.
4. Because I never seem to have enough time to plan my holidays as well as I would like I never seem to find out about a local event until I return from the holiday. Personalised emails could be used to let holiday goers know what is happening before they actually arrive at their holiday destination.
5. I am increasingly seeing examples of shopping cart recovery emails (an email to tell a recipient they have left a product in their shopping cart) but what about adding a second cycle to these messages. For instance if the recipient still hasn’t purchased 48 hours later, send an email to let them know how they can get help with their order or reminding them of the benefits of your service?
6. Moving away from campaign ideas, perhaps you could find out exactly what system your recipients receive their email messages on i.e. Outlook 2003. This information could then be used to tailor your content accordingly, for example sending video content just to those people where you know it will work correctly.
7. Local government or utility providers could give each customer their own email address (email@example.com). This could remain with the property and ensures you always have the correct email address for the property.
8. In the B2B sector you could ask your subscribers to create a folder just to put your businesses emails into (and provide instructions on how to ensure your messages filter into the folder). In this way your company name and industry expertise will be easy to find whenever your customer or prospects need it.
Hopefully my eight “ideas” above will have given you some food for thought. What innovations are you planning on adding to your email program this year?
I’m always on the look out for examples of good practice in email marketing. So when I visited my local Makro cash & carry store to top up the office coffee and biscuit supplies, I was pleased to find an in store campaign to grow email subscribers.
In this post I’m looking at what Makro did and using this example sharing ideas how you can make an effective campaign to grow your email list using offline touch points.
Makro is a wholesaler to businesses and you must show your customer card to gain entrance. There was a stack of email registration forms at the entrance desk. Even better, the assistant checking my customer card explicitly explained the option to subscribe and asked if I would be interested. This was either a very diligent employee or Makro had the foresight to provide a staff incentive to encourage bringing the email subscribe offer to the shoppers attention.
Invoice rear side showing subscribe form.
Even better at the end of my shop when I’d loaded up my goodies and paid, the rear of my invoice carried a subscribe call to action too as show in the image above.
Many businesses miss the opportunity to ask for a subscription on their standard print materials. In many cases there is empty space going unused, for example the rear of receipts. Draw up a list of all the printed materials in your business and look how a subscribe call to action could be incorporated. You may be surprised at the number of free blank spaces you have. Here is a list of common print materials to get you going; leaflets, compliment slips, invoices, till receipts, business cards, flyers, discount vouchers, coupons, point of sale displays, packaging, food menus, event tickets, posters, feedback forms, brochures, print newsletters and magazines, instruction booklets, guarantee cards.
Once you’ve identified the spaces where you can put your call to subscribe, you need to think about these three questions that every potential subscriber will have:
What benefit is being offered to me?
Should I risk sharing my email address?
What do I need to do next?
These questions need to be answered, in that order and as simply and quickly as possible.
So how did the Makro subscribe form answer these questions? Let’s have a look at the actual form I picked up.
The front side of the instore subscribe form.
The rear side of the instore subscribe form.
Front side has the benefit stated ‘Exclusive offers’
Rear side includes two more benefits, ‘Tailored offers’ and ‘News & Information’
It states ‘We promise not to bombard you – we typically send one email every week’
The action to take is given, to register online or complete paper form and return to store.
The three key questions are covered and in the right order on the left side of the form rear. The promise not to bombard and the ‘tailored offers’ helps to reduce reader anxiety that they will receive lots of emails. It makes them more comfortable to share their email address.
How about trying to improve this form?
The front side copy puts the headline as Click!, rather than the benefit of Exclusive offers. Attention would be better grabbed with the benefit coming first.
To further reduce the anxiety of sharing an email address, the bombard statement could be made stronger “We promise to look after your email address, we won’t share it or bombard you – typically we send weekly”. The small print does say the email address won’t be shared, but the small print won’t be read.
The text top right repeats the benefit but not consistently, missing the key exclusive offers. This text looks awkward, redundant and may even confuse.
The card is laid out in a way that does not control the eye path, so not all people will read the text in the same order. This means we are not certain of getting our message across in the order we want.
The instruction to return the card to the store would be better placed at the bottom by the signature and date. The point at which the information is needed.
The box for the email address is too small. A typical email address is 25 characters and space should be allowed for up to 50. The small space will cause squashed writing and impair data entry. This could wipe out 15% of the captured email addresses as not usable.
To address these challenges the card layout needs to be changed to improve flow, control the reading order and give more space for the email address.
Next time you see a paper based data collection form, take a good look and think about the questions you are asking yourself, how it answers them and the flow of the form.
It’s easy to see a form from the customers view when you aren’t intimately related to the offer and purpose. Viewing your own form through the eyes of a customer is much harder. So for your own form find a few colleagues, friends or customers. Given them your form for 30 seconds, then take it away and ask them what they saw.
Do leave a comment if you’ve seen a good instore email subscribe campaign recently.