RSS bypasses e-mail—and may be the ultimate segmentation tool
By Mary Wagner
Customers registered with eBags.com got something new in the e-mail they received from the online retailer the first week in December: a link allowing them to subscribe to an RSS feed that will let them know when the daily eBags Hot Deal is posted. Clicking on that link brought up a page with the deal of the day, plus an explanation of RSS, and links to several subscription-based or downloadable readers—applications needed to view that subscribed content.
If the customers didn’t know what an RSS feed is, they’re not alone—many retailers don’t know what an RSS feed is either. But in an age where legitimate marketing e-mail has fallen prey to spam overload, RSS—really simple syndication—is getting some retailers’ attention as a way to rise above spam. A recent Jupiter Research study found that 60% of marketers polled said spam filters are reducing the effectiveness of their e-mail marketing campaigns. And even when permission-based e-mail makes it past spam filters, overburdened consumers may ignore or delete even e-mail they signed up to receive.
RSS, a means of publishing regular updates to web-based content, is a channel that exists outside of e-mail. RSS subscribers choose the content they wish to receive from publishers—blogs, for instance, are often syndicated via RSS. Other content sources now include retailers who create their own RSS feeds. Consumers who wish to receive RSS feeds download to their computer a feed reader, an application that allows them to view the delivered content. They may even have this functionality already through service bundled into MyYahoo; future releases of leading operating systems will likely incorporate reader functionality as well. Consumers choose from a variety of online sources the RSS feeds they want to subscribe to.
The RSS reader thus added to a consumer’s desktop or laptop, for example, periodically contacts the feed sponsor’s server to look for and pull the requested content. It opens a small window in the user’s browser to deliver that subscribed content for viewing, whether it’s news headlines or, in the case of eBags, information on and a link to the Hot Deal of the day.
Part of the appeal of content delivery via RSS for consumers is that the only content that the channel delivers is content they’ve asked for: as a subscription-only model, it’s 100% spam free. That’s part of its appeal to marketers, too: Though subscribers ultimately may or may not choose to view the content, the delivery rate is 100%.
That was an important part of eBags’ decision to pilot an RSS feed to augment a healthy e-mail marketing program. “It was a huge part of our thinking,” say e-mail marketing and retention manager J.T. Capps. “You need to keep moving with the marketplace. People are looking at RSS as a way around clutter. We need to be early with that and the minute customers are looking to do that, we want to cater to it.”
No waiting
Whether as an end-run around crowded e-mail inboxes, a branding exercise, or in the case of dynamically-generated feeds, a way to super-segment the customer base, RSS is popping up in the marketing efforts of a growing number of retailers. Proponents say it’s an easy way to leverage content that already exists, and one that’s tuned into the perpetually plugged in and online way more consumers are living and shopping now. “The value of RSS is that it allows you not to have to wait for anything or look for anything. RSS lets you say in advance, ‘This is what I want; anytime you publish something that has to do with this, send it my way,’” says Ethan Holland, director of e-commerce at W. Atlee Burpee’s Burpee.com, an early RSS feed sponsor.
And it can be a relatively low-cost implementation, even for those outsourcing to a third party. For example, notes Paul Rosenblum, vice presidnet of marketing for RubiconSoft, a consumer preference marketing services company with an on-demand delivery model, an e-mail service provider may charge one cent to a fraction of a cent per message for distributing an e-mail newsletter. At a million messages a week at a half-cent per message, the cost for one week’s mailing would be $5,000; for four messages a month, $20,000. By contrast, he says, the fee structure for RSS feed is a flat monthly fee that does not include a per-message fee. Under that fee structure, distributing the same four communications to customers via RSS would be about a tenth of the cost of e-mail—less than $2,500, Rosenblum estimates.
EBags’ implementation of RSS from e-mail technology and services vendor WhatCounts is just in the pilot stage, and, so far, RSS subscription is offered to customers only in its regular marketing e-mails. Depending on customers’ initial level of interest in subscribing to an RSS feed, Capps says eBags will integrate it into its other marketing efforts in 2006 and put the subscription offer on its web site. While it’s too soon to determine that interest, Capps is betting that RSS is the right delivery channel for Hot Deals. “RSS lends itself very well to alert-type functionality, whether it’s about an item back in stock or new models or brands,” he says.
So why not just send out such alerts via e-mail, as many online retailers already do? Aside from the possibility that any message can get lost in a crowded inbox, enthusiasts say RSS trumps e-mail on a couple of fronts. For one thing, RSS can give marketers the chance to reach out to customers in a more targeted way and more frequently without risking customers’ annoyance.
“Right now, retailers know they really can’t e-mail their customers more than once a week,” says Forrester Research analyst Charlene Li. “With RSS, the consumer is saying, ‘I want this information—go ahead and send me something every day.’”
Zeroing in
For another, the more immediate nature of RSS feeds and options on feed delivery that already exist or that are on the way stand to create more of what the industry is calling “seducible moments” between marketers and their customers: zeroing in on them with the right offer at the time they are ready to buy.
“I’m not in my RSS reader all the time. I don’t always have my instant messaging on. And I hate going through clogged e-mail,” says Li. “But if those Lion King tickets come on sale at a price I want to know about, ping me as fast as you can so I can take my kids. Or if a certain item comes on sale on eBay, I want to know as soon as possible. E-mail is not necessarily the way to do that.”
In fact, the experiences and observations of retailers who have already started doing just that highlight the opportunities and the challenges of the channel from a marketing perspective. One of retail’s oldest brands became one of the first to offer an RSS feed to its customers when Burpee.com launched one early last year. Director of e-commerce Holland is a fan of the technology in part because he believes it’s an innovation that offers something fresh to the end user online.
“Many of the things that make you think how great the Internet is, like analytics for instance, take place behind the scenes,” Holland says. “RSS is something directly visible to the end consumer that is going to bring them better content.”
Keeping it fresh
Delivering that content could amount to a positive branding experience for any e-commerce feed sponsor, but in the absence of ongoing sale alerts for a retailer with a highly seasonal business, exactly what content can make for a compelling daily feed?
“One of the hardest things about an RSS feed is that you have to be able to provide a steady stream of content to keep it fresh. You can’t just post once a month,” Holland says. He adds he has unsubscribed from about a third of the RSS feeds to which he subscribed because he found their content to be of no value or as he terms it, “spider food.”
Holland found his own answer in the graphics and photo legacy of Burpee’s 130-year history, including thousand of photos sent in by proud home gardeners. The feed, which requires about an hour of IT time once a day five days a week to load into a preformatted template, includes Burpee’s weekly e-mail to customers repurposed for syndication and other graphic content including customer pictures.
“Most people go to Burpee once a year in the early spring to plan what seeds they want and maybe even order directly,” says Li. “With the feed, the relationship has gone from a once-yearly event to a daily branded experience.”
And as with the company’s regular e-mail, any product mentions are linked back to the site and the opportunity to buy, and that’s driving traffic and sales. According to source code showing the origin of clicks to the site, click-throughs from the RSS feed went up 200% from February to March 2005, and 400% from February through November. Revenue off RSS is up 200% from spring to fall.
The future
At DVDEmpire.com, the estimated 2,000 RSS subscribers represent a fraction of an e-mail marketing list of 200,000 to 300,000. Yet the company views RSS as its future. “A lot of people ask us for coupons via e-mail, then they don’t get them and they get angry,” says director of operations Alicia Berry. “About a third of our e-mails are undeliverable because the customer has changed their e-mail address, or put up a spam blocker or put us on some list. Because we do send coupons, we want to avoid that through RSS feeds.”
Feeds now are generally on new title releases, and they’re static, updated once a day. But DVDEmpire expects to launch RSS delivery of coupons in 2006, and it’s working on developing dynamically generated, customer-specific, customer-service feeds, such as instant notification when an order ships or notification of any order-related issues. Already, Berry says, DVDEmpire has seen that customers who receive its RSS feed buy 30% to 40% more than customers who don’t get the feed. Berry notes that other factors could be responsible for that difference, but says there’s also a difference in a straight comparison of buying habits among the same customers before and after subscribing to the feed, with customers who previously had not received the feed buying about 3% more once they get the feed.
While Berry and DVDEmpire see RSS as a better way to eventually communicate with much of the customer base, they’re also aware of limiting factors and issues unique to the technology. “The problem we are seeing with RSS is that the feed readers don’t prioritize,” she says, noting that with multiple feeds coming into one reader, there is no easy way for marketers or subscribers to arrange the order in which they appear. “That’s one of the hurdles we are gong to have to work on,” she says.
Using technology from RubiconSoft, fashion marketer Guess Inc. also launched an RSS feed, focused on new arrivals, in a limited way. Based on early results it will be expanding its use this year. Director of e-commerce Mike Africa says Guess last year started offering RSS feeds to visitors to one of the company’s three web sites, GuessFactory.com, but it’s identified on the home page only as My Shop Alerts. Africa believes too many customers still don’t recognize the technology by name and “the last thing I want to do is confuse anyone,” he says. The choice of GuessFactory.com for the initial rollout also was strategic. “Of our sites, that gets the least traffic,” he says. “To test something like this on the Guess.com site, it could potentially be great or it could be a debacle. I couldn’t put the main site in that kind of jeopardy.”
Open rates go up
For similar reasons, Guess elected not to include a link to downloadable RSS readers from outside sources for customers who didn’t already have one on their computers. It offers e-mail and My Yahoo as subscription delivery alternatives. “Say something crashes. Even though we are not technically responsible, because a customer went through our site to download a reader that is publicly available on the Internet, there might be a natural association that they downloaded it through Guess so Guess might be at fault,” he says. “I didn’t want any repercussions to affect us.”
Africa has seen results from RSS on GuessFactory.com sufficient to justify extending it to Guess.com and Marciano.com. “I’ve compared this to conversion rates in other campaigns I use to acquire or retain customers. In comparison to my e-mail campaigns, the open rate is about 50% higher and the conversion rate is nearly the same as conversion on the site,” he says.
Despite any issues associated with RSS as a lesser known and less-proven technology in e-commerce, Africa believes benefits associated with the technology ultimately outweigh the concerns. Not the least of them is the ability of an RSS feed to create a kind of super segmentation of customers that exceeds any targeting capacity currently offered in e-mail.
“You can’t segment e-mail every possible way. If you have a customer who says, ‘I want to hear about accessories, outerwear, new arrivals and handbags,’ and you are only sending one e-mail a week, which e-mail do you send?,” he says. By contrast, with a dynamically-generated RSS feed, the customer in effect creates her own segment, pulling data from the server in all those categories to go into one communication.
That said, Africa says e-mail isn’t going away, pointing out that many consumers aren’t quick to adopt new technology. But eventually, he says, RSS will have a significant impact on e-mail. “I think you will see better results than in your e-mails, because of spam and all of the efforts people are making to detect it,” he says.
New channels ahead
Currently, most RSS feeds from e-commerce sites are delivered to desktops or notebooks, but it’s also possible to receive some feed content by specially equipped phone. Li points out that as a platform RSS isn’t locked into one delivery channel. “Once you have content in RSS, you can move it in any channel you want,” she says.
Adds Brian Ratzliff, co-founder and vice president of marketing and business development at WhatCounts, “People need to start thinking about RSS and blogging as essentially an operating system. What are going to be created are all kinds of different software modules applicable to being built on that foundation.”
Ratzliff sees a day in future years when the shopper visiting a Neiman Marcus store, for example, will walk into the store, get a dynamically-generated feed delivered to her cell phone or some other handheld device that that identifies her location and with the press of a button, receive relevant shopping information and perhaps even an electronic coupon.
Even Ratzliff isn’t sure how today’s consumer would respond to that scenario of tomorrow, but he says the technology to support it already exists. In the meantime, analysts like Li believe that given the relatively low investment required, ease of basic implementation and growing interest in RSS among consumers, now is the time for retailers to start investigating the technology.
“Blogs are not for everyone. Podcasting definitely isn’t. But RSS is one of those no-brainer technologies that everyone should be experimenting with,” she says.
mary@verticalwebmedia.com
