So, the CEO walks into your office and says, “What’s the one email marketing strategy you will use in 2007 that will really move the needle on revenue?” What do you say?
You could distract their attention by pointing out the window, screaming, “Oh my gosh, was that a bird?!” Or you could stammer through something like, “Well, we’ll be testing a number of new approaches that might add up to revenue growth, but I’m not sure which tactics will contribute most.” Or you could confidently say, “Segmentation. We will be creating experiences that are extremely relevant for a number of high value segments — many of which are impossible or not cost efficient to reach in other channels — and in doing so, improve response rates, customer retention and lifetime value.”
Put segmentation at the center of your plans this year. It’s not a nice-to-have, advanced technique. It’s essential. Here’s why:
- We are out of room. Many email marketers made their forecast in 2006 by sending more email. No matter if each campaign was less effective, because the sum total of more touches resulted in more revenue. Unfortunately, that strategy won’t protect you in 2007. First, because many marketers are already sending four to five emails a week (you can’t double that number and expect to keep your sender reputation and deliverability high!). Second, because more generic email is not more interesting to subscribers. But, more relevant email is much more interesting to subscribers.
- We need higher response. And segmentation delivers higher response. Both Jupiter Research and Forrester Research (as well as Return Path client data) report that segmentation drives 45% or higher improvements in response.
- We are not in charge. Subscribers are. Inboxes are more crowded than ever, and consumers and business professionals alike have become more and more savvy about blocking, unsubscribing, filtering and even complaining (clicking the “this is spam” button) to get rid of email they no longer find interesting. To breakthrough, you can’t just send more of the same.
- We are not doing television here. Email is not a broadcast channel where sending the same to all gets top results. It’s a 1:1 channel (or at least 1:x, where x is some number of like-profiled and like-interested subscribers!) Sending out the same message to everyone probably means you are connecting perfectly with a very small slice of your file. Some additional percentage will find it mildly interesting, or find it interesting only some of the time. Segmentation lets you ensure that most of your email is relevant for most of your audience, all of the time. Big difference.
- We are not alone. Email does not operate in a vacuum. Consider your content and contact strategies in relation to all your online marketing – search, online advertising, email acquisition, web analytics – as well as offline marketing. This can free you to use email where it works best. Take a campaign approach and combine email with postal, search or online banner advertising to build a crescendo around a product launch or high volume season. Use email to support in-store or catalog promotions.
We’ll be talking about segmentation all year, and look forward to hearing how you are using this technique. Send your questions and feedback and we’ll try to address them in future articles.
Meanwhile, I’ll be talking about segmentation at the Online Marketing Summit in San Diego in late February, and urge you to consider joining us. We’ll talk about email, search, online marketing – and most importantly – how all these fit together to help you create memorable and profitable customer experiences.
Hundreds of senior level marketers are already registered, but space is limited (and by invitation only). You can apply for an invitation here (be sure to mention that you heard about the event from Return Path!) or email me with questions.