Email Engagement Based on Time and Frequency February 2015 update Email marketers should be very familiar with the Click-Through Rate (CTR) metric for emails. The metric is defined as number of recipients that click divided by the number of emails sent (#clicks / #sent). It is typically used along with other metrics such and open rate and opt-out rate to determine the effectiveness of an email campaign. To help IgnitionOne customers design more effective marketing campaigns, we wanted to get a deeper understanding of email CTR. So we asked this question: How does increasing the number and frequency of emails sent impact email engagement rates over time? To help answer the question, we sampled historic data from emails sent over the past four years, which includes data from billions of individual emails sent across various industries. For this investigation, we needed a standard way to define the opt-in age of a recipient. To define our time metric, we sequenced all the individual emails sent to an individual based on the chronological order in which the individual received those emails. So the first email that an individual received would be #1, the second email they received would be #2, and so on. Using this email sequence number for all individuals, we calculated a CTR for an email database based on the number of emails that an individual has received over time. When exploring this data, the first thing that we see is that on average email engagement steadily decreases over time, with the largest drop off in engagement occurring during the period when the first few emails are sent. The level of engagement then generally continues to decrease as a recipient receives more emails.
This trend begs another question: Is this decreasing engagement trend typical of all industries or are individual idiosyncrasies masked by looking at all industries together? To dig deeper into this, our Insights team produced a similar chart, this time showing the data broken out by Industries. While each company and brand serves unique email audiences, the data shows that the overall trend holds true across all the industries and brands investigated.
The conclusion reached is this: Sending more emails does not increase engagement. In fact, as shown in the previous charts, the more emails that are sent over time, the less likely customers are to engage with email from a brand in the future. Suprising, as sending multiple frequent emails is very common across industries, especially for those companies engaging
in promotional or product marketing. For example, these companies send a lot of emails often to inform customers on new products and offers on an ongoing basis - sometimes as often as three to four times per week (or per day). This approach is obviously popular. Email remains an inexpensive outbound marketing channel; however, the cost consideration is typically limited to a spend perspective. Marketers must also consider the greater costs of failed engagement, such as losing customers who opt out of email communication as well as opportunity costs of weakening the relationship with individuals over time due to send fatique. This results in fewer people opening fewer emails and engaging less overall with the brand. The data shows that the number of customers who are truly engaged with the brand dwindles over time, which leads to increased pressure to expand the audience, often resulting in acquisition costs. Marketers often overlook these added costs until it s too late - when email as a channel has lost its credibility. From an analytics perspective, avoiding these issues begins with relevancy. Instead of blanketing an audience with more email more, a stronger approach is to do fewer sends while targeting those sends around key time periods that align to the wants and needs of the individual recipient. Context and seasonality are key considerations. From your own personal experience, think back to the times you ve received an email promoting a product that does not interest you or perhaps you would be interested in taking action if only the email was sent to you last month before you made a purchase. Too often recipients delete without engaging until they are ready to purchase again. At the same time, marketers have ROI pressure, specific goals to achieve. Some fear that if emails are not sent to everyone all the time that they will miss out on sales; however, data shows that the opposite may be true. Delivering relevant messaging (versus general offers) to the appropriate person (identifiable by profile data) at the right time (based on things such as historic and/or algorithmic data) translates to less email sent, with those fewer sends proving to be more effective. Driving Relevant and Targeted Email Strategies While the idea of sending the right message to the right people at the right time appears to be obvious, many companies remain tied to a batch and blast (aka, spray and pray ) approach to their email program. Why? Because true relevance in digital messaging means taking a step back to look at things at a much higher level than you normally would for email campaigns. It requires a disciplined, customer-focused, holistic strategy.
The key to driving truly relevant messaging (in email or other marketing channels) is using data available to understand customer behavior, preferences and responsiveness to marketing campaigns, then providing targeted communications at the customer level. Relevancy starts with understanding how prospects and customers move throughout the customer lifecycle for your brand (see a simplified version of the lifecycle below), targeting communication to each phase. At the very highest level, segmenting prospects and customers based on the phase of the lifecycle for each individual at that moment provides a starting point for crafting the best message for the appropriate moment in the customer journey to ensure relevance. From there, the more data that can be used to identify marketing opportunities and further increase relevancy, the better. Prospects and customers can be divided into two segments, as each has different wants and needs. While it may seem like common sense, a person who is new to a brand (who has just signed up to receive email) should be treated much differently than a loyal customer with several repeat purchases and high level of engagement. Prospects may or may not be fully aware of a company s products or services, which is may be why they signed up to receive information in the first place. Lumping them into a promotional email cadence along with the rest of the database lessens the chance of conversion and in turn leads to decreased email engagement over time. Prospects Once customers and prospects are separated with the intent to treat them differently, the next step is to look to the data to identify opportunities beginning with prospects as an example. With a little
help from analytics professionals, key email metrics can be plotted out to illustrate the window where the likelihood for engagement or conversion is highest, such as by tenure month. Tenure month is the number of months since the first email was sent to a prospect. In many cases, this window of high engagement is small (it is in the first few months after gaining the permission), but it does point the marketer in the right direction. So how is the data applied? This is often where best practices come in. (Note: Best practices are not always best for every situation; you must customze them to your own unique business needs and use data and results to optimize your approach.) An example of best practices in this scenario is a welcome series for new prospects - it s a good thing to do. By examining the engagement window data mentioned earlier, it shows that best time to engage via email is not in the first week but between months one and two after the first email was sent to a prospect. With that guidance, a welcome series can be developed and executed at the most opportune time, before engagement drops off later. While many companies have implemented a welcome series because they follow industry best practices, an even better best practice is using the rich data available to further optimize this series based on data, so it is more effective at establishing a foundation for long-term engagement. Customers Now let s take a look at adopting a targeted and relevant email strategy for specific customer segments. The Strategy and Analytics team at IgnitionOne recently identified an opportunity for a client in the travel industry by examining customer behaviors when booking vacations. The data revealed that there are two primary segments of customers: vacationers that travel last minute (they book less than 30 days before their check in date), and those that plan ahead (they book greater than 30 days before their check in date). With those two groups established, reservation data was used to examine vacation reservation trends over time for each. The trends showed that the likelihood for a customer to repeat a
vacation reservation (booking again) is highest approximately 12 months from their original reservation anniversary date. This data was applied through the development of an Annual Stay Event email series that encouraged past customers to book the same vacation one year later. This strategy utilized the data that defined the high-level segment (customers), the more granular behavioral segment (last minute or planners) and the right timing of the email message based on historic reservation data. With this level of detail, the relevancy of content, message and timing of delivery goes up considerably. By understanding where customers and prospects fall within the customer lifecycle and using the available data to illustrate gaps and optimize best practices, truly strategic and relevant campaigns can be developed through email and other channels. Once this foundation and discipline is established, the opportunity for more complex strategies is endless. About IgnitionOne IgnitionOne is a global leader in cloud-based digital marketing technology. The company s Digital Marketing Suite (DMS), with a powerful data management platform (DMP) at its core, simplifies life for marketers by providing an integrated suite of solutions that significantly improve digital marketing performance across all devices. The DMS encompasses algorithmic media management across channels such as search, programmatic display, mobile, email and social; advanced data management; user scoring, lead optimization and website personalization. With a global footprint of over 450 employees in 17 offices across 10 countries, IgnitionOne is one of the largest independent marketing technology companies in the world. IgnitionOne currently scores over 300 million users monthly in 75 countries and powers more than $30 billion in revenue each year for leading brands, including General Motors, CenturyLink, Bridgestone, La Quinta and Fiat, as well as advertising agencies such as 360i, GroupM and iprospect. For more information, please visit http://www.ignitionone.com, follow the company on Twitter @ignitionone or visit the blog at http://www.digitalmarketingsuite.com. info@ignitionone.com www.ignitionone.com