January 27, 2011, 2:28 PM

Personalized e-mails perk up conversion rates at Ice.com

Conversions tripled when the retailer tied e-mails to consumers’ shopping behaviors.

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With untargeted e-mail campaigns producing an open rate of 20% but a sales conversion rate of only 1.1%, Ice.com realized it had to change its approach.

When it tied marketing e-mails to its customers’ shopping behavior it realized far better results, said Pinny Gniwisch, co-founder and executive vice president of business development at the web-only jewelry retailer, in a presentation at the National Retail Federation Conference & Expo this month.

Gniwisch noted that lifecycle messaging e-mail campaigns, which base e-mail offers on registered customers’ shopping histories and other personal information such as birthdays, more actively engage shoppers. A lifecycle e-mail message, for example, might send an offer for a diamond necklace ahead of a customer’s wedding anniversary.

At Ice.com, lifecycle messaging campaigns have produced an open rate of 26% and an average sales conversion rate of 2.3%, Gniwisch says.

The performance results have been even better when e-mail messages are based on a shopper’s recorded click-stream activity, he said. A shopper known to have clicked on pearl earrings, for example, might receive an e-mail promotion for pearl earrings. Click-stream-based campaigns at Ice have produced an open rate of 33% and average conversion rate of 3.9%.

However, Gniwisch warned that even targeted campaigns can’t run too frequently without risking training customers to wait for a better offer to come. He suggests e-mail marketers carefully analyze how different segments of customers respond to e-mail frequency.

“If we send a second offer too soon, customers may keep waiting for the next offer,” Gniwisch said. “The key is understanding how your customer segment acts.”

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