Reversing the telescope
Mike Weston, UK MD of Silverpop gives his views on how far technology has come in achieving the dream of one to one marketing – with a look at the latest thinking in email marketing.
When I started in the digital industry ten years ago, investors and marketers alike were seduced by the dream of one to one communication with their customers – and a lot of fingers got burnt in the process.
This is due to two obstacles: 1) The mindset of marketers was firmly entrenched in broadcast techniques, sending one message to millions of people at once; 2) there was no technology available that was smart enough to efficiently deliver millions of individual conversations, all taking place simultaneously... and not enough hours in the day to do it manually.
Here we are in 2007, surrounded by debate and buzzwords like web 2.0. The vision of one to one marketing has returned. If web 2.0 is really about the consumer taking control of communication – through writing/consuming blogs and accessing less mainstream user generated content, the key concept marketers must get their head around is relevancy.
As Peter Simpson of lateral group recently wrote in this newsletter, “The receiver and not the sender must define relevancy, (does) our piece of marketing have a proposition that meets the needs of a recipient locus of time and space” Let’s simplify that: in a world where consumers increasingly control what they read, does my message matter to them?
By grappling with this question, marketers are beginning to change the way they approach communication with their customers. They are using conversational media such as email to embark on relationships that appear to the customer as tailored to their needs, rather than just meeting the marketer’s timetable. Smart marketers are taking the information customers give them (by visiting websites, placing orders or updating their profiles) to deliver timely, relevant messages back to them with a much greater return on investment as a result.
For instance, simply sending out an email at exactly the same as each subscriber originally opted in to receiving that marketing message can produce a 20per cent increase in click through rates; a 65 per cent increase in conversion rates and a 45 per cent increase in value of order. But maybe this is the key number that gets your attention: It also contributes to a 187 per cent increase in the overall average revenue.
In an example like this, the marketer is responding to the customer’s timetable through the efficiencies good technology can deliver (we call it ‘Per Recipient Send-Time’). At the same time, technology means marketing can become much more accountable and much more easily evaluated – showing us why this change of approach is so valuable to the marketer.
Did you know, for instance, that repeat sending of a message to those who have opened an email but not gone on to purchase any products from it can still be very successful and ultimately result in sales? We only know this though by applying a scientific analysis to retention marketing.
The accepted opinion of the advertising industry is that strong creative ideas will cut through the clutter. But I think creativity is about more than just the message; it is also about how the message is delivered. Creativity does not equate to fancy flash files – it is about getting seen, getting the entire message through filters, to different email clients such as Outlook, Yahoo, Gmail, AOL. Creativity is bringing us back to that old adage of ‘right message,’ and as we can now see ‘right time’.
Let’s not forget that email marketing does have a valuable future if done properly. Regular, relevant, contact still makes customers feel valued. It will increase direct sales, reduce churn, increase customer lifetime value and lead to referrals. We just need to remember to do it sensibly. There are many more metrics which are widely used including: open rates, click rates, conversion rates, customer referrals, and unsubscribes, etc. Clever marketers however will be asking the next set of questions: What about analysing the number of customers who haven’t reacted to an email? Should there be a specific follow-up message directed to these people?
As the balance of power moves away from traditional advertising, and as offline spend is moving online, retention marketers have never been better placed to hone their skills. Retention marketing is overtaking acquisition spend. It is this with will enable the marketer to have a one-to-one conversation with millions of people. Good retention marketing is invaluable in its own right and makes acquisitions much better value. Customers are being bombarded with emails but the study of retention marketing will enable more messages to get through.
Maybe it is time to think less about what the Sales Director says he wants marketing to do for him, and more about what the customer wants from you. Get the right message to the right person at the right time and the Sales Director will get what (s)he wants (revenue)... but if the customer gets what (s)he wants, who knows... maybe he or she will keep coming back for more.
Mike Weston - UK MD - Silverpop
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