Thursday, August 18, 2011

Lesson #77: The Basics of Email Marketing

Some people will say that email marketing is slowly going the way of the dinosaur, as the new generation of tech users are much more reliant on their phones than their PC's (e.g., text messaging, smart phone apps).  But until that day happens, email marketing should continue to be an important part of your communications and marketing strategies.  This lesson will summarize best practices and key considerations for setting up your email marketing efforts.

Select an email platform.  There are plenty of very sophisticated email management software packages out there.  And many, like Cheetahmail, come with a very expensive price tag, often way too expensive for early stage companies to afford (e.g., starting at $5,000 per month).  My recommendation for startups is to use one of the free softwares out there, like Mail Chimp, until your business and list size scale to the point you can afford and may need the additional functionality from the more sophisticated software programs.  I use the free Mail Chimp software for Red Rocket mailings, and it works perfectly fine for my needs.

Design email collection forms.  The more data you ask for in your sign-up form, the less people will actually take the time to fill in the form.  So, my suggestion is to keep your form very simple to start, to get them to hand over their email address.  And, then you can subsequently collect additional information over time, from follow up emailings.  So, don't initially ask for a ton of data fields (e.g., name, title, company, address, phone, age, gender, education level, income level, interests).  At a minimum, you can simple ask for their email address only or other other basic information you will need to fine tune your marketing efforts (e.g., name, age, gender).

Design your sign up incentive.  When you ask to collect an email address, you will have much better success if you provide the user with a reason to hand over their very private email address.  That could include things like special member-only discounts, unique content or a sweepstakes entry for email users that sign up.  I am fine with the first two examples, but I would avoid sweepstakes.  You get a bunch of garbage sign ups from sweepstakes from users simply trying to win a prize, and they have no real affinity or interest in your core product.  And, about 50% of sweepstakes subscribers unsubscribe within a few months after the promotion.  I much prefer "sign up for 10% savings" or "sign up for member only benefits".

Link to an example emailing.  Give the user a visual of what an example emailing looks like, by linking to old emailings.  It will give the user a much clearer understanding of the nature of the email content.  And, by indexing the old emailings on your website, those additional content pages will also help you drive additional traffic from the search engines.

Link to your privacy policy.  Put a link to your privacy policy right next to your sign up request.  And, add a note that "we will not spam you".  This will help the user feel more comfortable handing over their email address, if they know you take their privacy seriously.

Determine opt-in vs. opt-out strategy.  Opt-in means the user needs to click a check box to sign up.  Opt-out means the users needs to unclick a check box to not sign up.  You will get a lot more names with opt-out, but you will get a lot higher quality from opt-in.  So, decide what is best for your business, given the nature of your product.  And, keep in mind, the cleanest list will come from a double-opt-in strategy, that the user not only checks the sign up box, but needs to click a confirmation link on a test email that goes to the user.  I am always a fan of double-opt-in for getting the best list and ensuring email addresses actually work.

Grow your list internally.  From your own website, you want your your sign up form accessible everywhere it is logical to do so.  That could include a main navigation button or email entry box in the header of your website (e.g., "Sign Up for Newsletter"), that is seen on every page of your website.  And, this can include adding the opt-in check boxes around all other contact entry forms (e.g., when user is buying a product, also ask them to join your list). 

Grow your list externally.  You can grow your list via banner ads that run on third party websites. Or, via co-registration campaigns on third party websites (e.g., user can sign up for your list too, while signing up for someone else's email list from that site).  Or, you can buy/rent email lists for your use.  Banner ads could get expensive for this purpose, combining cost of the media placement with the cost of the incentive to sign up the user, so I would be careful here.  I really like co-registration campaigns, if done on sites with very similar demographics (e.g., iExplore did co-registration with Conde Nast Traveler Magazine's website).  But, make sure you are not paying too much for the co-registration (e.g., a two way free campaign is best, allowing partner to sign up names from your site too).  I would avoid buying/renting lists as the quality is usually garbage and it is not worth the price paid.

Target your list.  While growing your list, you also want to be targeting your list.  The more you can target your users' demographics and interests, and deliver them customized and relevant content, the better your email efforts will perform.  Targeting can be done on demographics, like gender, age or education.  Or, based on psychographics, figuring out what interests the user has.  Or, based on asking their current demand (e.g., what are users currently looking to buy).  As an example, when iExplore promoted an Alaska trip to people that previously indicated they wanted to travel to Alaska, our open rates and conversion rates were 4x better, than sending that same Alaska trip to the entire list.

Design your email content.  The content of your emails need to be: (i) consistent with what you promised the user at the time they signed up; (ii) customized to each targeted user, where desired and possible; and (iii) provide really compelling offers and unique content.  The better the offers, the more your users will forward the emails to their friends, further helping your acquisition efforts.  I also like to include: (a) main navigation links back to the website, in case the email reminds them to buy something else not offered in the email; (b) simple unsubscribe buttons, so you don't piss off users that don't want your emails anymore; and (c) a link to a webpage of the newsletter, in case they are having trouble reading the email format itself.

Design your subject line.  Short, sweet and impactful is the best strategy for subject lines.  The subject line can make or break whether a user opens the underlying email.  Something generic like "monthly newsletter" is less exciting than highlighting a juicy offer therein, like "50% Off All Orders This Month".  And, make sure your company name is clearly mentioned, either in the subject line, or the "From" field of the emailing, so the user knows the emailing is coming from you.

Be sensitive to spam filters.  Most of the email softwares have built in "spam testing", which you should always use prior to sending any emailing.  Certain keywords in the content of your email or subject line, may trigger spam alerts to the major ISPs, directing your email to the spam folders of your users, instead of their inbox.  You don't want any of these words (like "special", "deal", "free") to hurt your efforts, so filter them out ahead of time.  And, the additional advantage of using an established email software program like Mail Chimp or Cheetahmail, is they usually have "white list" relationships with the ISPs, and can quickly get you off any "black lists" for spamming.  Also, at the time of registration, let your users know to add your email address to their personal "white lists", so your emails don't end up in their spam folder by mistake.

Determine frequency.  You should set your emailing frequency based on: (i) how often are you sourcing special offers or content; (ii) how often will be acceptable to your users (and consistent with what you promised them at the time of sign up); and (iii) what works best for your business/marketing objectives.  As a rule, weekly or monthly emails is best.  Daily can lead to user fatigue and anything longer than monthly are you are losing valuable marketing opportunities to your users.

Track your results.   You always want to track your new subscription rate, your unsubscribe rate, your open rate, click rate and sell through rate from any emailing.  Constantly test what vehicles are doing the best to grow your list, what emails upset users to the point of unsubcribing, and how your emails are performing versus industry averages.  As a rough guide, a generic mailing to your entire list should see a 15%-20% open rate (on number sent) and a 15%-20% click rate therefrom (2%-4% click rate on number sent).

For future posts, please follow me at:  www.twitter.com/georgedeeb

5 comments:

Monica Sims said...

Great post, George.

A couple of things to note:
1) When designing email collection forms, it's great to ask for social profiles at this point too especially if you think you will be communicating with your customers via social media. This way you don't have to collect it at a later date, will help determine where your customers are on social media (so you can focus your efforts), and you can get started quickly on social media without having to hunt for people to follow.

2) Set expectations on frequency on the sign up form. Make sure people know how often they should expect an email from you from the get-go. If you are inconsistent with your messages, you will lose your audience.

iContact has a great email marketing guide that can be found here.

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Anes Amrani said...

wow really nice informations thank you man I have bookmarked your blog it is very informative blog but I have a question how much money or visitors could email marketing give me.

thank you

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George Deeb said...

Anes, to answer your question, if you email to 100,000 names, expect 15-20% to open, or 15,000-20,000 to open the email. And, of those, 15-20% to click on the email, or 2,000 to 4,000 clicks. Then whatever your conversion rate is from there, in terms of revenues. These are ballpark for a generic monthly newsletter. Could be more or less based on quality of list and quality of offer.

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