Revenue increased 11.9% in Q1 of 2015, to $17.26 billion compared with $15.42 billion in the year-ago period.
Targeted e-mail programs stem overflowing inboxes
It wasn't so long ago that simply having the power to instantly and inexpensively reach every customer on their list and then measure the response made e-mail something like the Eighth Wonder of the World among retailers. But given the explosion of marketing e-mail hitting consumers' inboxes now, the effectiveness of this "spray and pray" approach has dwindled.
Forrester Research Inc. found that 25% of the online marketers it surveyed last year sent more than 3 million e-mails to customers monthly, up from 20% the previous year. That clutter makes segmenting campaigns by customer data the ticket to success in e-mail marketing today, experts say.
Progress may have pushed aside batch-and-blast e-mail campaigns, but it's also ushered in marketing technologies easier for retailers to integrate with e-mail, to create segmented, more personalized campaigns. Such "humanization" of marketing e-mail goes beyond personalized subject lines to include content customized according to an individual's interests as indicated by past browsing and shopping behavior.
And it can drive powerful results. According to Forrester's data, e-mail containing a product they'd browsed previously and were already thinking of purchasing influenced 19% of consumers to buy.
Easier to use
Serving up relevant, customer-specific content in e-mail has been a time- and resource-intensive process. But new developments put it within the reach of retailers without a lot of either to spare, according to Joe Colopy, CEO of e-mail marketing services vendor Bronto Software Inc. Colopy says Bronto and other vendors have worked on making their e-mail marketing platforms easier for marketers to use; not dumbed down, but streamlined to bring marketing sophistication to a broader range of retailers.
Automation is a big factor here. For example, Bronto's technology has made it simpler for marketers to set up rules that automatically launch e-mails to customers in response to triggers, such as abandoned shopping carts, post-purchase surveys timed to hit days or weeks after a transaction, or birthday reminders.
"At a lot of e-retailers, the e-mail marketing person probably is also the e-commerce manager and doesn't have a lot of time," Colopy says. "If they can invest the time upfront to automate the program and then let it run, they get better results because the program is extremely relevant."
If automation is one key to segmenting e-mail campaigns, analytics to feed data into those automated rules is just as critical. Analytics allow retailers to understand which customers are buying, when, and how much—all insights that drive relevant e-mail campaign segmentation. Some marketers also use analytics to measure how e-mails travel through the social realm so as to inform future promotions. A recent Forrester report, for example, describes an online marketer that tracks who clicks on and forwards its e-mails the most. It then sends those influencers special offers to keep them sharing the marketer's e-mails with their online social circle.
Piece of the puzzle
In the service of retailer clients, e-mail service vendors also are integrating a variety of e-commerce platforms, product recommendation engines and order management systems with their own technology. Because they see that their offering and retailers' campaigns are stronger and perform better when they incorporate data and functionality from additional sources, vendors like Bronto are working to make that integration as seamless as possible.
"We recognize that e-mail is a piece of the puzzle, but not the whole puzzle," Colopy says. "With e-mail marketing alone, you have one view of the world, but not a complete view. And if you don't have the rest of the view, you can't do e-mail marketing justice."