What is email marketing?
Email marketing is a marketing strategy that uses email as a tool to deliver messages and generate sales – almost too self explanatory. Email marketing is a form of marketing that can make the customers on your email list aware of new products, discounts, and other services in a variety of different ways.
For instance, you can use email marketing to educate your audience on the value of your brand for a softer sell or keep them engaged between purchases. Sometimes email marketing can be used to simply send cart abandonment and transaction emails or as complex as having numerous automated email nurturing sequences designed to build long-term relationships and generate more long-term sales. Email marketing can also be used to accomplish anything in between but it is important to know that every eCommerce marketing strategy needs a thoughtful email marketing component.
When you want to grow your brand or sell your stuff, email marketing is one of the most popular—and effective—tools around. Email marketing is a powerful marketing channel that has become so popular for businesses over the last couple of decades partly because it forces the user to take some kind of action; an email will sit in the inbox until it’s read, deleted, or archived. But aside from its 1 to 1 direct relationship with a user’s inbox, it is simultaneously one of the most cost-effective tools available, too. In fact, our research suggests that for every $1 spent, email has an average return on investment (ROI) of $38 – $44.
Why is Email Marketing Important?
Email marketing is one of the oldest online marketing tactics that continues to claim the top spot in the marketing mix of most businesses. As people are bombarded with ads filled with promotional offers and commercial campaigns everywhere they look in today’s evermore connected world, the inbox remains one last sanctuary of peace and solitude online so to speak.
Today’s marketers need to do more with less. They need to connect with their audience in a hyper personalized way, while staying on budget. Marketers that can do this, meaning connect with their prospects and customers in a highly targeted way—will be successful in delivering ROI and revenue back to the business. If your business can get into your prospect’s inbox, you have a chance to establish a strong relationship that will lead to future sales.
Below are just a couple of reasons why most marketers still believe email marketing is the most powerful tool in the box:
- Email has a huge reach – Our research predicts that by the end of 2021, the number of active email accounts will reach just over 4 billion. Take a step back for a minute and understand the scale we are talking about. That’s more active users than Twitter, Reddit, Snapchat, Pinterest and TikTok put together. Everyone who’s active online must have an email address, as it functions almost like a currency of the web. Picture it; When you sign up for a website (like an online store), you have to enter your email address to create the account. You even need an email address to create a Facebook or Twitter account. What’s more, Facebook and Twitter email to notify users of activity, like when someone is tagged in a photo. If that weren’t enough to convince you of email’s monstrous reach, consider the ongoing struggle over data breaches and privacy over the last decades involving these social platforms. Plenty of people are exiting some of these social media channels and data suggests that the decline will continue as behaviors shift over the coming years.
So when it comes to prospecting new customers online, email is the most powerful tool available to online entrepreneurs.
- Email has high conversion rates – The overall CTR across all display ad formats and placements is 0.17%, which is less than 2 clicks per 1000 impressions. On average, Facebook CTR reaches 0.119%, while Twitter’s ranges from 1 to 3%. Email, on the other hand, has a 3.42% CTR on average, across all sectors and devices. The costs of running email marketing campaigns are much lower compared to other online advertising channels, that’s why it consistently scores as the most cost-effective lead generation tool.
When it comes to conversions, there simply isn’t a more powerful channel than email. In fact, industry insiders claim the average click-through rate of an email campaign is around 3% (of total recipients), whereas the average click-through rate from let’s say, a tweet is only around 0.5%. 3% is 6x 0.5%! This means you are 6 times more likely to get someone to click through to your website via your email than you are from Twitter.
As discussed earlier, your email subscribers have told you they want to hear from you and this isn’t typically the case with social. Research suggests 4.24% of visitors from email marketing actually buy something as compared to just 2.49% of visitors from search engines compared to a measly 0.59% from social media, according to a survey conducted by Monetate.
- Email generates the highest ROI – Like we have mentioned above already, email is the single most effective advertising channel. Nothing else generates $38 – $44 in ROI for every $1 spent. Nothing. Seriously, think about all of your marketing channels. Do any of them generate 3,800 – 4,400% returns for your business? Nope. Many eCommerce companies are lucky to break even on their paid advertising investments.
It’s clear from these statistics that email is a cost-effective channel for marketers, but why does it outperform other channels so significantly when it comes to ROI? It has to do with delivering highly personalized and relevant messages at scale. Unlike social networks where you send, in broad strokes, what amounts to status updates to every follower regardless of their location, interests & purchase history, email allows you to be hyper-targeted with your communications.
In fact, a McKinsey report shows that email is still 40 times more effective at acquiring new customers than Facebook or a whole host of social channels. And according to DMA, when done right, email marketing segmentation can increase sales revenue by 760%. Which shouldn’t be surprising to you because I know you’re a savvy business person. If you can segment your audience(s)/customers in a meaningful way designed to help you take insightful action, you may be on your way to creating a scalable, repeatable revenue generating source.
- Mobile-friendly email marketing is growing rapidly – According to Salesforce, 68% of companies have already integrated mobile marketing into their marketing mix as a result of its growing importance. A staggering 79% of people use smartphones to check their email (that’s a higher percentage than are using smartphones to make calls), so it’s not surprising that email opens on mobile have grown by 180% in the past three years and the average smartphone conversion rates have gone up by 64%. Creating mobile-friendly campaigns is a bare minimum. An even better approach would be to optimize every aspect of your email campaigns to drive more traffic and sales. (Fix this paragraph or add to it and finish conclusion)
What are some different types of eCommerce Emails?
With 33% of consumers reporting that email has the biggest influence on their online spending, it’s worth exploring the different types of eCommerce emails that are most effective at generating sales.
Welcome emails are the first emails sent to a new subscriber or customer and they often serve as the first impression a company makes. In fact, almost 75% of consumers expect to receive a welcome email when they sign up with a new brand. Welcome emails can deliver videos, special offers, a sign-up form, or simply give a friendly hello in order to establish a relationship with a new contact.
Welcome emails usually have the highest delivery, open, and click-through rates. For best practices, keep your welcome email friendly, inviting, informative, and it should “wow” your audience, thanking them for joining the party – this is unique to the style of different brands and their voice though! A strong framework for welcome emails lets your audience know instantly who you are, what they can expect from your company, and you plan to build trust going forward.
Abandoned cart emails are automated email reminders sent to customers who exit a website after adding items to their shopping cart but before checking out. If you are like most eCommerce merchants, you are probably spending tons of time and money on driving more visitors to your website via Facebook Ads or Google Adwords. Sending a follow-up email to users that fall into your cart abandonment bucket will help you recover more of your previously lost revenue and ultimately convert more of those visitors that you are attracting to your website. If done well, you can offset some of the CAC costs your business incurs from all that hard work you put in during the lead gen process towards the top of the funnel. And if you really want to be a superstar, use these abandoned cart emails to not only win back business but you might even improve AOV through strategic cross-sells and up-sells. Just think, abandoned cart emails average a 4.64% conversion rate. We strongly encourage your business to use these emails as a highly effective conversion optimization technique.
Transactional emails are sent to users in response to some kind of action. They are typically triggered in real-time and automated. Transaction emails differ from your standard marketing emails in that transactional emails are triggered by events, interactions, or preferences within a service or application rather than by a company’s marketing campaign. They are designed with specific goals in mind and some of the most popular types include purchase receipts, password resets, cart abandonment, support requests, and many others.
Shipping update emails are Delivery emails keep customers updated about the status of their order. The ability to track packages is very important to customers, so it’s essential that you utilize these types of emails. Fundamentally, shipping update emails are about boosting customer satisfaction rather than driving sales. There are promotional opportunities, but it’s essential to prioritize technical details first – the status of delivery, order number, expected arrival time, and shipping address. Most commonly, delivery emails are sent when a product leaves the warehouse and on the day it’s due to arrive.
Reward emails are automated emails designed to delight and reward loyal customers with special offers and deals. Reward emails are typically triggered after a certain milestone is achieved (for example, when a customer spends a certain amount of money on the site) and enjoy unusually high open and conversion rates. Try offering a special product only available to them like a special fragrance or limited edition earrings.
Referral emails are very similar to the reward emails family. Requesting users to refer a friend in exchange for an incentive is certainly similar to reward emails as they are both designed to reward customer loyalty. A main difference in the referral email is that they don’t necessarily need to be triggered by certain milestones but are designed much more with retention and acquisition in mind as the main driver for conversion. Use them in tandem with reward and flash sale emails.
Leave a review emails are designed to do exactly what they sound like — entice customers that have recently purchased an item to leave a review. Customer feedback emails are sent after a customer has received their product, usually when enough time has elapsed for them to use it. These types of emails are exceptionally powerful tools for brands to incorporate into their growth loops if executed properly because feedback emails enable companies to gather social proof in the form of testimonials, which absolutely have a direct impact on conversions, in a cost-effective way. In fact, below are 3 strategies to help your business boost conversions immediately:
- Offer an incentive to customers – Studies show that incentives boost email conversion rates by nearly 20%. One great way to encourage customers to leave reviews without the need to allocate resources for freebies or large discounts is by entering them into a prize draw on completion of the review.
- Make the review process simple and communicate this in the email – Many customers will be hesitant to undertake the review process because they’ll assume that there are lots of steps involved. Let customers know it won’t take long and keep the review form straightforward and concise when they do click through.
- Don’t forget to let customers know when people are reading their reviews – Send emails to inform customers that their reviews are being read. This strategy is excellent for building engagement (everybody loves attention) and incentivizing recipients to respond to future requests.
Flash sale email is an email designed to be sent to your list to announce a limited time offer and drive traffic specifically to your sale. These are often emails you see around certain holidays or perhaps around birthdays if that type of information has been exchanged. Flash sale emails do run a risk of being flagged as spam by the recipient due to their promotional nature, but they generate a 35% lift in transaction rates which can be absolutely huge. With a list of hopefully segmented users, we cannot recommend enough using flash sale emails at strategic points during the year to generate more sales from lower hanging fruit or to experiment with growing AOV (average order value).
Final thoughts
With over 40 percent of B2B marketers surveyed during the last decade saying that email newsletters are the most critical component to their content marketing success, we think it’s a revenue generating tool your business probably can’t afford to overlook. And with about 70% of millennials/Gen Z shoppers out there with real purchasing power claiming to prefer communicating with their favorite businesses via email, your business should take email marketing seriously.
If somehow you’ve reached this point and you’re still just not super keen on email marketing, try processing that 99% of consumers world wide that have access to an internet connection check their email every day. Not only is it by far the preferred way to receive updates from brands for just the average internet user, but the frequency, learned behavior, habit and acceptance of email as a generally effective communication channel is in a category all of its own in that respect. Other marketing channels, (these are averages and broad stroke generalities here, we understand that individual brand circumstances will vary), pail in comparison to have that type of behavioral penetration when measured by conversion rate. Social media, we’re lumping together platforms as a broader slice of all traffic generating channels when measured to direct, organic and other broader traffic channels, is absolutely making a dent in email’s dominance but it has a long way to go.
As marketers and business owners, we don’t think you can afford to ignore those statistics. That’s why we feel it is important to develop a strong email marketing strategy. In conjunction with other effective/efficient traffic generating sources, a well-automated, high value delivering email marketing strategy stands to empower your business to reach new heights!
