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Home » Site Promotion Articles » The 5 Cardinal Sins Of Email Marketing

The 5 Cardinal Sins of Email Marketing

One of the most frequent questions my customers ask me is "What should I do to make sure my email marketing campaign is a success?" My answer is always different, depending on the client's industry, campaign goal, and many other factors. But in today's e-marketing landscape, there are a few pointers that stand true for any client, a few things that can really make or break an email campaign.

You could overlook these, and you'll still have an email campaign. But if you're stuck wondering why your email messages are yielding little to no response, you may want to take a closer look and consider if you're commiting any of these 5 email marketing sins:

1. When new subscribers sign up, I should treat them just like my old subscribers.

One of the most overlooked aspects of email marketing is the welcome message, or the message your subscribers receive as soon as they sign up for your email list. The welcome message is your first opportunity to connect one-on-one with your subscribers. Think of it as your first impression, since this is the very first of, hopefully, many email messages you'll be sending them. Of course, you want to make a good first impression: be courteous, friendly and very mindful of your audience. Make sure to remind them of the benefits of signing up, include links to your website and tell your readers how to get a hold of you if they need. It's also important to ensure the welcome message arrives shortly (if not immediately) after the recipient signs up. So your best bet here is to choose an email service provider that sends automatic welcome messages to your subscribers on your behalf. Some of the top email programs will allow you to fully customize your welcome message, so it reads, looks and feels just like your company.

2. All my subscribers are the same, so I should just send the same messages to all of them.

Well.. actually, no, and no. It's not rocket science: subscribers are individuals, just like you and I. They have different preferences, different habits, different personalities. Addressing your subscribers by their names is a good start (and an easy thing to do, since most reputable email service providers automatically insert your subscribers' names into the greeting field). But, in most cases, this personal greeting is just not enough. Say you own a clothing store, and you sell men's, women's and children's clothing. John Smith is a customer, and he loves your menswear collections. But he's busy, and he has no women or kids to shop for. So why would he waste his precious time browsing through your specials on blouses and bibs? It's been proven: In a recent study by DoubleClick, email users were 72% more likely to respond to a business e-mail if its content was based on the interests they had specified. Choose an email service provider that allows you to set up interest groups, and then allows your subscribers to choose which groups they want to belong to. Back to the clothing store, you would produce 3 separate emails (men's, women's, children's) and only send them out to the subscribers who want to read them, creating higlhy-targeted, personalized and effective email campaigns.

3. When a reader clicks on a link from my email, it doesn't matter if they end up on a page that looks nothing like the actual email.

Um, actually, it does matter. First-off, you want to provide a consistent image of your brand. That's just Branding 101. You wouldn't create business cards that look one way, letterhead that looks another way, and a store sign that looks completely different. So why would your email marketing campaign look nothing like your website? Chances are you already have a website, so all you really need to do is customize your email campaign to have the same look and feel. Many email service providers will be able to create you a custom template that matches the exact look and feel of your website. However, beware of the price. While some email service providers charge at least a few hundred for this, others offer free custom templates as part of their services.

4. My email recipients may enjoy my messages, but they don't really want to share them with their friends.

Here's the good news: According to a January 2006 report by Sharpe Partners, 89% of US adult Internet users share email content with their friends, family and associates. And 75% of them forward emails to up to six other recipients. It's called viral marketing, and it basically translates to word-of-mouth through email (as long as you provide good content, an essential aspect of any email maketing campaign). Some email service providers have taken this insight into consideration, so they have integrated the all-important "Forward to a Friend" feature in every email you send. A few email providers will even go a step further, and allow you to track which subscribers are forwarding your messages, so you can get a true glimpse at your "brand ambassadors" (and maybe offer them some extra perks).

5. After I send out my email campaign, there's nothing left for me to do.

If you look at it that way, you're really missing half the process, and jeopardizing the success of your future campaigns. Here's why: any reputable email marketing program will include campaign tracking and reporting. These allow you to view how many of your messages were opened, which bounced back, which links were clicked on, and, with some email providers, exaclty which recipients clicked on each link. This data not only converts email marketing into an incredible lead generation tool, but it also allows you to learn more about your subscribers. So if you operate a travel agency, and you see nobody clicked on the Mexico vacation link, but 200 readers clicked on the New York vacation link, you'll know next time to place a greater focus on New York vacations. You could even send a follow up campaign to those 200 readers with a special offer for a New York vacation upgrade. That's lead generation and a highly-targeted upsell in one shot. Are you taking advantage of these?

And here is another random article you might be interested in...

CLV - Customer Lifetime Value - What does it Really Mean?

Customer Lifetime Value (CLV) can get a little tricky, but I'll try to make it simple. By now you've probably heard the term yet may not fully understand how to use it effectively, if at all. That's because every "Tom, Dick and Mary Marketer" have done their best to make it more complicated than necessary.

The hardest part of calculating CLV is figuring out exactly what your customers' "lifetime" really is.... and the only accurate way to arrive at that number is by getting, storing and analyzing your customers' data. Period. If you've been in business for a while, this should be easy to get, but if you're a start-up you're going to have to estimate this based on industry standards.

Although there are several ways to arrive at CLV, the easiest is to calculate:

1. The average length of time a customer stays your customer

2. The number of transactions that an average customer will have with you during that time and

3. The average dollar amount per transaction

Multiply these together and you'll arrive at a usable number. But remember, junk in, junk out... so make sure your original numbers are accurate!

Once established, you can use your CLV as a benchmark for developing a realistic customer acquisition (or retention for that matter) budget. For example, let's say you find out that your average customer:

1. Stays with you for 5 months

2. Purchases something from you 3 times per month

3. Spends an average of $2 per transaction

In this case your average CLV would be $30. Based on this, it would be foolish to spend even $20 to gain one customer... you'd be left with little, or no, profit (unless of course, your margins are outrageously high). On the other hand, your customers may hang in there for 22 months, spend $20 per transaction and purchase from you a greater number of times. Since your CLV would be much higher, you could afford to pay more to gain a customer. Again, the specifics differ widely and there are many factors to consider, Also note that this does not include any costs associated with preserving this customer relationship. In the real world these must be included.

It is crucial that you understand your CLV and use it to guide your communication decisions! (A good book on this subject is Donald Lehmann and Sunil Gupta's, "Managing Customers as Investments"... visit our website, www.StrategicMarketingAdvisors.com for a review and ordering information.)

3. Your specific goals, such as: * Acquiring "x" numbers of new customers * Increasing the number of current customer transactions * Increasing the length of time your customers remain your customers

4. Proposed media costs and actual/forecast response and sale rates (you can find these out online or from any reputable advertiser)

Once armed with this information, you'll be in a good position to choose. Here's an example of how this might work. Let's assume the following:

* I am a widget retailer

* My goal is to get 1,000 new customers this year

* I will get 200 customers whether I do "anything" or not... (for example word-of-mouth, walk- ins, etc.)

* That means, I need to acquire the remaining 800 using some form(s) of advertising

* I can spend $40,000 to "buy" these 800 new customers

* My CLV is $40

* After careful consideration, I decide to conduct a direct mail campaign

* Based on my careful research and experience, I know that I can sensibly assume that 1% of my audience will respond by calling (called a "response rate") and that 80% of the responders will become new customers.

* Given this forecast and my goal of 800 new customers, I know that I'm going to have to mail out 100,000 sales letters.

* As luck would have it, the cost to create, print and mail one letter is 37 cents (using 3rd class postal rates) which comes to $37,000... leaving me with a $3,000 "fudge factor"

So, let's see where I stand...

1. The campaign cost is well within my budgeted amount of $40,000, my forecasts are reasonable based on industry standards and experience, and can realistically accomplish my goals. So everything is perfect, right? Wrong.

2. 800 customers with a CLV of $40 will result in revenues (over time no less) of only $32,000! That's called a losing proposition!

What should I do?

1. In the short term, find out if there are less expensive advertising vehicles that may bring you similar results.

2. Find ways to reduce the direct mail costs without sacrificing response and sale rates (e.g. one color vs. four; lighter paper stock).

3. Identify ways of increasing the sales rates (for example beef up the offer; send to more people â€" you'll get economies of scale this way so the per piece price will drop dramatically and you'll acquire more customers)

4. Offer added products to increase your customer's average transaction amount

5. Institute robust retention programs aimed at increasing the longevity of your average customer

Although this is a very simple example of how CLV works, it clearly demonstrates how important understanding it is to your business. Without considering CLV, you'll be shooting in the dark - potentially wasting thousands of dollars and commiting serious, or even devastating, blunders.

Copyright 2005 Mary Eule