Teach Your Email to Behave: Transactional Targeting After the Sale

Teach Your Email to Behave: Transactional Targeting After the Sale

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Your dog will never learn any impressive tricks unless you teach her, right?

Well the same goes for you when it come to learning new email marketing tricks. The difference though is that the tricks you’re about to learn here are the kind that can earn you a lot of money instead of just a gentle pat on the head.

And if you’re willing to learn new tricks you’ll be leaps and bounds ahead of the majority of your fellow marketers.

In fact, 80-percent of all marketers are not creating targeted, relevant email communications based on a user’s web activity. If you’re one of them, you’re leaving steaks on the table after the initial sale.

If this is you, here’s what you’re settling for:

  • A lower return on investment
  • Reduced customer lifetime value
  • Smaller customer transactions

If you’re fine with this then keep mass blasting bulk impersonal email promotions and accept the paltry CTRs you’re likely getting.

But if you want more, pop the hood on your business and look deep inside.

You’ll find you’re actually sitting on a goldmine.

What do I mean?

You have access to some of the most valuable and free business intelligence known to marketers; your customer behavior data.

Rather than sit on it, silo it, or ignore it all together like the some do, use your business intelligence to create behavior based personalized messaging that results in additional sales.

In other words, teach your email to behave based on what your customers do!

WARNING: This is not going to be easy nor is it likely to be embraced by the shortsighted.

Aside from the technical aspects of organizing an automated behavior-based email marketing system that personalizes customer communications even as you sleep, marketers who see one-off transactions as the end of the road won’t likely excel. The initial sale is simply the beginning of an overall lifetime customer experience you have the opportunity to create, massage, and steer.

If you’ll think of the initial transaction with a customer as the beginning of a relationship, behavior- inspired email marketing is fundamental in strengthening the relationship and ensuring it stands the test of time.

Little Love for Triggers

If a customer fills their cart to the brim then suddenly abandons it, as is the case with 74% of the carts filled online, how likely is it that person will soon get an automated email showing them the items they abandoned?

If you’re like most of your peers, the odds are slim.

Only twenty-percent of marketers are using behavioral triggers to create automated email marketing that increases engagement and sales.

We’re talking about email triggered by a user’s behavior.

More specifically, here’s how email marketing provider Mailchimp defines transactional email:

What is Transactional Email?

Image via: Mailchimp

Unfortunately, some of you may never get the opportunity to try out transactional email marketing before it’s too late. Research suggests customer acquisition costs for most ecommerce companies are so high it’s unlikely they’ll break even financially if they rely solely on one time shoppers.

For instance, the same study found the average online apparel shopper did not become profitable for the retailer until he or she had purchased from the site four times.

Transactional Email - What's the Break Even Point With a Customer?

Image via: Bain & Company

The chart suggests the retailer must retain the customer a minimum of twelve months just to break even.

Read between the lines and the data reveal that loyalty is often the key to profitability for ecommerce concerns. Aside from rewards programs, which can actually earn you a billion dollars, creating relevant and personalized email messaging that is triggered by specific behaviors is a proven way to earn that loyalty and profitably squeeze value out of existing customers.

Problem is 41% of marketers have no immediate plans to start using behavioral targeting in their email marketing.

Don’t be in that 41%!

The Virtues of Behavioral Targeting

What’s that?

You’ve already automated based on behavioral triggers, huh?

Listen, it’s fantastic that 59-65% of you, according to the latest Email Marketing Census,  have automated email marketing in place that’s triggered by an opt-in, subscription, or site visit.

But lone wolf bloggers can easily become this sophisticated.

Dig deeper into your trove of customer data to identify triggers that elicit a more meaningful engagement and you’ll reap rewards other marketers do not. In fact, transactional emails triggered by user behavior are opened up to eight times more frequently than bulk promotional mail campaigns.

Why is this?

Industry estimates suggest 35% of email recipients open email based on the subject line alone. Rather than guessing or even split testing headlines to boost open rates, behavior-triggered emails provide you with something specific, concrete, and personal to insert into subject lines.

Even better, behavior-inspired messaging also results in bigger paydays for marketers:

Transactional Email Have Higher Greater Value Per Email

Image via: Experian

In fact, Forrester Research found trigger-based email marketing campaigns can generate 4x more revenue and 18x greater profits. Besides making you more money in the here-and-now, transactional email is the type most likely to increase customer lifetime value and grow the trust that is often lacking between a consumer and marketer.

So what types of behavior should you key on?

How might you go about personalizing the creative to be triggered? And what kind of results can you expect?

Glad you asked!

Before we provide you with four triggers you can use to create behavior based email messaging designed to improve after-the-sale conversions, cross-sell, and upsell- take a look at the results transactional email marketing produced for the following company.

Transactional Email in Action: A Snapshot

No one knows the perils inventory can cause better than home decor retailers.

What’s trendy today may be shunned tomorrow. Especially when your products are seasonal in nature.

Creative Co-Op, a decorative home accessories wholesaler, found itself in desperate need recently to move excess inventory fast.

Instead of relying on an impersonal bulk mail promotion, the company relied on data to drive a segmented email marketing campaign.

After identifying the closeout products that needed to be moved, Creative Co-Op set up relational tables that drilled down into its customer behavior data to match purchase histories to the closeout items that needed to go.

The automated messaging was personalized and looked like this:

Transactional Email & Personalization

Image via: Marketing Sherpa

How was the campaign received? The results include:

  • 808% ROI in the first month
  • 42% increase in order conversion
  • 255% increase in closeout items sold online

Remember though, most marketers are missing out on the rewards that come with behavioral email marketing.

Don’t blend in with the pack.

The Big Hang Up

You’re wondering what the catch is, right?

The benefits of behavioral-triggered email marketing are obvious at this point, are supported by the data, and often generate returns that would embarrass a marketer engaged in broadcast email marketing.

Still, not everyone is benefiting like apparel maker Lands’ End.

Initially, the company was not able to accurately track each customer who was eligible for a trigger such as in the event of a cart abandonment. However, after retooling its CRM system, this case study suggests Lands’ End was able to increase its email driven revenue by 9%.

It’s critical to note here the technical hurdle over which Lands’ End had to jump to earn the lift in revenue.

If behavioral-triggered email marketing is really a secret weapon that can send revenue through the stratosphere, what’s the hang up?

Why are just one in five marketers doing it?

As is often the case, it’s technology or the lack thereof that prevents marketers from fully realizing the potential of specific tactics. Specifically, this brief created by Adobe & Econsultancy found that nearly one-third of the marketers interviewed said their customer management systems would not allow them to personalize email as they’d like.

The problem may also be one of mindset.

Besides the five or six-figure yearly price tag vendors say can come with establishing a sophisticated transactional marketing foundation, the CMO at marketing automation software provider Marketo suggests many marketers have no interest in learning how to use the technology required to trigger behavior-inspired email.

"Here's a big secret: Marketers don't give a sh-t about technology," Sanja Dholakia says recently told CIO.com. "They're actually pissed off about having to figure out all this technology, and they're doing everything in their power to bury it."

Combine all of this with customer privacy concerns that can quickly kill even a sophisticated transactional email campaign that caps frequencies, and you now know why behavior-triggered email is not being used by more marketers despite the obvious benefits.

Take a deep breath now and relax a moment, won’t you?

Trigger #1: Replenishment Cycle

If you sell dog food you know approximately how long until that bag your customer bought for their dog Bark Obama (it’s just a pun, ease  up Democrats!) will be empty. Take advantage of this insight and combine it with the data you have regarding customer purchasing dates to send gentle refill reminders.

It’s exactly what eyeglass retailer Warby Parker does:

Transactional Email Replenishment Cycle

Image via: HubSpot

This kind of email is rare.

Only twenty-percent of marketers expect to use product sales cycles to trigger behavioral email this year.

Trigger #2: Related Pain Points

Similarly, just 27-percent of marketers will send automated email marketing triggered by content downloads such as white papers, ebooks, or case studies.

Content downloads are often designed to spotlight a problem, pain point, or challenge.

Why wouldn’t you follow that download with a solution?

Not sure specifically what additional pain points existing customers might have?

Use data on site content users are viewing to trigger an email or just flat out ask them yourself like this fitness expert does:

Transactional Email - Pain Points

Image via: Get Vero

Trigger #3: Inactives

I’ve been preaching about behavior but now I want you to consider the behavior that’s not happening.

Despite needing repeat business to become profitable, sixty-six-percent of marketers will not reach out and touch inactives based on behavior this year. However, some marketers are extremely active when it comes to inactives.

This is how cloud storage firm Dropbox tries to win back inactives:

Transactional Emails - Triggering Inactives

Image via: HubSpot

Trigger #4: Expansion Revenue

Let’s get this straight; existing customers have given you permission to market to them yet you choose to ignore that permission and purchase history?  

Far too often that’s the unfortunate case. Seventy-three-percent of marketers have no plan to use customer behavior to trigger an email offering an up-sell.

The recommendation engine Amazon uses to suggest upsell or cross-sell opportunities gets substantial attention but the online retail giant isn’t alone:

Image via: HubSpot

Conclusion

These are just four triggers you can use to launch personalized email that is more frequently opened, clicked through, and results in greater revenue. There are, of course, additional behaviors buried in your data that you can use to more effectively engage customers.  

But lets be honest- you probably won’t- The following chart illustrates how infrequently marketers are using customer behavior to drive personalized email marketing engagement (ahem use this to your advantage):

Image via: Econsultancy

So stop sitting on that goldmine you have. Dive into the data, identify existing customer behavior, and target them with dynamic and personal email that earns loyalty and repeat business.

It’s all possible if you’ll teach your email to behave after the initial sale.



About The Author

Nick Winkler is a contributor to the Shopify Plus blog. He helps individuals & organizations generate new leads, make more money, and ignite growth with story. Get more from Nick here.