Close the email engagement gap with behavioral targeting

Consumers are drowning in emails. Faced with a flood of offers, marketers have a tough job getting consumers to open their emails let alone take the next step and engage with the brand.

Mind the Engagement Gap

Open rates (the percentage of delivered emails that were opened) have remained consistent over the last three years. However, our Email Benchmark Report on Q3 2016 which analyzed over 7 billion emails tells a different story for what happens next. Click rates (the percentage of delivered emails that were clicked) and CTO rates (the percentage of opened emails that were clicked) continue to plummet. Overall, the CTO rate has declined 12 percent from the previous year. We call this the engagement gap.

People want to have an emotional connection with a brand; yet they’re tired of batch and blast campaigns that don’t show any awareness of who they are. If digital marketing is about creating relationships, why does it often make a company look like the friend who can’t remember how much you hate sushi when making dinner plans?

Behavioral Targeting Increases Campaign Effectiveness

Many emails’ only personalization is a customer’s first name in the greeting or subject line but that’s not enough. Marketers need to find a better way to create 1-to-1 communications with their customers.

Segmenting an email audience based on their purchase history and browse behavior (product pages they’ve visited, items they’ve placed in their shopping carts but never checked out) can close the engagement gap. This information allows marketers to deliver personalized, relevant content that will connect with customers and increase conversions.

Let’s look at some of the most cost-effective and relevant data streams that can help brands personalize their communications with consumers and increase relevance. Using data from these disparate sources to personalize communications can drive engagement and ROI:

• Email: Email provides exceptionally valuable information about customers based on open times, click-throughs, forwards, and other engagement metrics. Adding psychographic (values, attitudes, interests and personality traits) and demographic data (age, gender, household income) can help marketers create highly personalized campaigns that lead to better conversion rates.
• Web: Websites are another outstanding source of high-quality behavioral information. They enable marketers to identify where website visitors came from; how frequently they visit; what pages they viewed; and how long they stayed on a page.
• Social media: Those likes, pins, hearts and smiley faces indicate a customer found the content engaging enough to take action. Visual platforms like Pinterest, Instagram, and Tumblr give marketers insights into what products a customer is potentially interested in buying. Marketers can use this information to identify customer segments by monitoring what topics they follow, ‘like’, or comment on.
• Cross-channel: Every customer service call, email open, Facebook comment, feedback survey, or support inquiry tells a story marketers need to hear. Unfortunately, it’s often a challenge to put these individual stories into a single cogent narrative. With the right tools, marketers can listen to multiple voices at once and identify the most important elements of the message their audience is sending them.

Getting to Know Your Customers Better Pays Off

How can you implement behavioral segmentation? What kind of offers can you make?

• Why not take advantage of cross-selling opportunities informed by prior purchases and consumers’ active browsing behavior? Marketers can use this data to select the most appealing merchandise for each consumer segment’s daily email.
• If there’s a 20% discount off all accessories today, why not feature ones that complement a consumer’s prior purchases as part of the promotion?
• Southwest Airlines revived the decade-old ‘Wanna get away?’ tagline, and has incorporated this theme into marketing emails. The emails successfully entice engagement by offering unbeatable deals in the subject line for flights subscribers have recently searched.

The key to increasing conversion is to make email campaigns smarter. If your daily promotional emails feature the right products for each consumer, they’ll drive 20-50% more in sales.¹

If you’re worried the size of your subscriber list is a barrier to segmentation, don’t be.  Although the amount of data you’ve collected can seem overwhelming, there are several steps that can help you simplify the segmentation process. For example, creating personas for major audience segments will help brands better understand, target and cater to different groups in their database.

Get Ahead of the Competition with Behavioral Segmentation

According to a report by RetailTouchPoints commissioned by Data Axle, many retailers find it challenging to identify, collect and apply behavioral data.

• While 72 percent of surveyed retailers have ecommerce store fronts, yet only one-third use purchase data to build customer profiles.
• Additionally, 42 percent do not use purchase data to recommend relevant products, or boost cross-sell and upsell opportunities.
• Furthermore, only 26 percent of retailers plan on collecting more data about their customers and how they engage with their marketing channels over the next 12 months.

Marketers who use behavioral data to target email subscribers are able to create more personalized communications which generally result in higher click and CTO rates that yield better conversion rates.

Statistics Reveal Other Email Gaps

Besides the Engagement Gap we identified, Data Axle’s benchmark study reveals two other gaps marketers must pay close attention to in order to drive more engagement and ultimately conversions from email marketing campaigns. Gain insights into the differences between mobile and desktop click and CTO rates; as well as among smartphone, desktop and tablet purchases.

1 http://www.jetlore.com/blog/how-customers-can-shop-in-their-email-why-you-should-let-them