Retailers shift their ad spending from TV, radio and print ads to digital ads.
Top retailers welcome customers and embrace social e-mail, but offer fewer e-mail discounts.
Virtually all retailers market via e-mail, with 95% of the top brands offering e-mail opt-in programs in 2011. But using the channel and using it to its fullest potential are not the same. In a time when inboxes bulge, retailers must seek out more ways to truly connect with their subscribers, turning superficial relationships into ones with dimension and substance that will reduce churn, build loyalty and drive revenue.
In an effort to highlight best practices and improve understanding of e-mail benchmarks and trends, Silverpop again teamed with the Internet Retailer Top 500 Guide this year to evaluate the e-mail programs of the top 500 retailers in North America, compared with other companies that didn't make the list.
Silverpop researchers logged on to the sites of 630 retailers, identified as those that achieve top sales by Internet Retailer, and opted in to those that offered e-mail marketing programs. During the course of 30 days, they evaluated and recorded the following:
- Location of opt-in link on the home page
- Subscription options offered to registrants
- Use of welcome e-mails
- Number of e-mails received during a 30-day period from December 2011 through January 2012
- Percent of retailers offering sales or discount incentives, and what types of sales or discounts were offered
- Percent of companies linking to social media sites, and use of fan/friend versus social-sharing links
- Unsubscribe links leading to preference centers
At the end of the study period, Silverpop then compared the Top 500 retailers against the companies that didn't make the cut. Since this was the fifth year Silverpop has conducted this study, we can compare 2011 e-mail marketing programs to those during previous holiday seasons.
Since 2008, more than 90% of retailers have provided an opt-in link on their home page. With this as the standard, we looked for the third year at the location of the opt-in on this page.
As in 2009 and 2010, the bottom of the page was the preferred location for the opt-in link, with more than one-half of retailers choosing it. The top of the page remained the second choice, but the middle option shrank in 2011, with fewer retailers placing their opt-in links there.
As competition for customer attention grows, online marketers must prioritize ways to grow their lists. Making the e-mail sign-up easy to spot is one way to increase a customer base. Placing e-mail opt-ins above the fold makes this call to action more visible. Consider offering an incentive with registration—such as a discount on the first order.
As part of the sign-up process, some retailers offer subscribers choices of the kind of e-mail they will receive, such as only relating to certain types of products. But this has yet to gain traction, and in 2011 only about one-quarter of the Top 500 offered this. In fact, the rate of use declined for both groups in 2011, dropping about 10 percentage points in each case.
Of those that do offer options, most retailers ask about shopping preferences, such as what types of apparel, sizes and styles the consumer is most interested in. This is an excellent way to get information that can be used to send shoppers content that's most relevant to them.
E-mail volume rises
Our study shows retailers are sending subscribers more e-mail. Since 2009, the percentage of Top 500 retailers sending five to 10 e-mails (including welcome e-mails) within a 30-day period has fallen from 32% to 18%, while the number sending 11 or more has leapt from 27% to 40%.
Within the Top 500, the number of remaining retailers sending at higher volumes (11 or more within 30 days) has doubled since 2007, with more than 20% sending this higher level of e-mail volume in 2011. While retailers typically send more e-mail during the holiday season, it's important to balance that volume with relevant content tailored to subscribers' preferences, activity level and behavior. Instead of asking, "What's the right amount of e-mail to send?" try asking, "How can we better connect with our customers?" This will yield a more substantive communications approach that's ideal for revenue growth and increased customer satisfaction.
For the second year in a row, the overwhelming majority of all retailers—68%—sent at least one welcome e-mail. This year, more than 70% of the Top 500 sent at least one welcome e-mail, while almost 60% of the remaining merchants included also did so.
The savviest retailers send more than one e-mail and use these welcome campaigns to educate subscribers about the brand, offer shopping incentives and encourage profile completion, among other things.
A welcome program is an excellent opportunity to follow up and start building loyalty with new customers. Showing them right out of the gate that their subscription is valuable gets your relationship off to a strong start. To maximize effectiveness, we suggest a timed series that follows the initial welcome message. Use these messages to educate subscribers about your brand and the benefits of subscription, and about policies that are customer-friendly, including free shipping or returns. You might consider offering a short survey to gain more understanding of their shopping habits.
Sales and discounts
For the third year, the overwhelming majority of Top 500 retailers offered sales or discounts at some point during the 30-day study period, with more than eight out of 10 including some sales-based incentive. However, the number of e-mails offering discounts declined both for the Top 500 and the remaining retailers, with the elite group dipping six percentage points in 2011 from 2010 and the remaining brands decreasing nearly 20 points.
This drop was also reflected in the number of retailers that included a discount in at least three-quarters of their e-mails. This year, 48%—240—of the Top 500 retailers that included discounts in their messaging did so in at least 75% of their e-mails, compared with 69% in 2010.