Email marketing in the world of ecommerce

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In our 27th episode of Expert Dairies, we’re going to discuss email marketing in the world of ecommerce. To offer key insights, we’ve got an expert joining us all the way from the United Kingdom. He’s James Gurd, and he’s a seasoned campaigner with more than 16 years of industry experience. He currently runs an independent ecommerce consultancy called Digital Juggler.

Aravindh: I want to begin by asking a fundamental question. Ecommerce, as an industry, is quite diverse and fast-paced. At a given time, you have so many things happening at the store level. So how do we ensure that the email communications from an e-store are relevant to the subscribers?

James: Yeah, I think that’s a good point. People get distracted by all the shiny new things and lose focus on what customers want and just send out campaigns rather than thinking about whether they’re sending the right things. I think the big challenge is maintaining a focus on what customers need and looking at as you grow rapidly.

At the start, it’s easy. When you hit fast growth, it becomes very easy to be distracted. So the first thing is you have to set clear expectations about our email program—when people subscribe, do they know what they’re subscribing to and why?

If they don’t, then it’s just a signup for what they want to get. If what they have in their mind doesn’t match with what you’re sending, you’ve instantly got a customer experience issue. That’s when you normally get high bounces. That’s when people don’t open. It’s just pointless sending emails to those people. So clear expectations—this is what you get and these are the benefits of signing up.

 The second bit is preferences. As you evolve, it’s easier to do this. Because, often when you start off, you just send out a very simple campaign. Mostly on a weekly basis. But as you grow and start doing different types of campaigns and learn more, give people options. Do people only want to hear about sales and promotions? Well, great. If that’s all they want, put them on that segment. Don’t send them beautiful, branded stuff and say, “Look at all this great stuff we’re doing.”

Not everyone wants to buy into your brand and get excited about it. Some people just want to buy, and that’s fine. There’s a real growth in preference centers. Some of the big retailers are doing this really smartly. They have a detailed set of sub options and they don’t try and scare people when they subscribe by saying something like, “Here you go! Fill out this form of 30 things.” What they do is gradually have somebody subscribed. Then overlay that CRM data through drip campaigns and say, “Hey! we’d love to know more about you. Do you like this?” They also use behavioral data from what people do on the site to inform dynamic segments. As you get more mature, you can learn more about this. That’s why you need to know what your subscribers want. You can use browsing and purchase data to dynamically push people into segments. But I’d also say this to everyone—you can’t make your emails 100% relevant to every single subscriber. It’s almost impossible. It’s because humans are so fickle. So learn and improve rather than obsessing about getting it right for absolutely everybody. Some people will leave—that’s life.

Aravindh: So it’s about understanding their preferences! Letting them specify their preferences, respecting that, and tracking their behavior and understanding what they really want and what could excite them.

James: Yeah, exactly. The tracking bit you just said is hugely important. You can use clicks and  onsite behavior to learn. You can track the journey of your audience, if you get your analytics set up. It helps you learn what type of content people click on and improve your strategy accordingly.

 Aravindh: James, before talking about the major aspect of ecommerce email marketing  (automation), I just want to get this question out of the way. I’ve seen people using their e-store platform itself to communicate with their audience via emails, and it is mostly based around the sole criteria of time. The automated emails entirely revolve around it. For example, when an item is added to the cart, send an email at this time. Then send the second email at this time. How important is it to also target them consequentially? That is, based on the response to their emails.

James: It really comes down to the tooling you have and the ability to create flow. Modern email providers and lifecycle marketing tools can create flows where you can then change what the person receives based on the behavior at the first. So it could be someone receiving a cart abandonment email and they click through versus they don’t. The email that they see second up is changed based on whether they have or not responded. So I think those flows are massively important. I know you want to talk later about trends, and this is increasingly where email the smart email marketing is going.

It’s about not treating everyone the same. But you have to start somewhere and you can’t get to flow-based email marketing without going through the learning. The learning is often doing the basics right—when people do something, let’s send something generic and let’s learn what impact that has; then we can take it to the next level. A good example of this is wishlists. It’s one of the most underutilized email triggers you could possibly have. A few businesses do it well. There’s a great gaming company called Steam who do it really smartly. You add to your wishlist, and you get a notification that says, “Hey congratulations, it’s in your wishlist.” Just as a reminder. But if the item on the wishlist goes on sale or it’s running low on stock, you then get the next notification, which says, “Hey James, this item you like is running out of stock. Don’t miss out.” The other thing they did brilliantly is when a friend of yours has added a game to their wishlist, they let you know by saying, “Hey, your friend John has just added this game to his wishlist—are you interested?” So they create all of these different strands of communication to try and add value to the customer. It’s not in your face, because it’s based on something you’ve done initially.

Aravindh: True. Workflows are getting increasingly popular, but like you mentioned, you have to get the hang of the basics first, learn the dynamics of email marketing, and then slowly migrate to automation. Workflows in particular help you send behavior-targeted emails by letting you visualize how your audience is going to engage with your emails.

 James: Yeah, I always say to people that you’ve got to think of ecommerce like product design. When true product designers create a product, they’re thinking about form and function, as well as the design and beauty. Building a beautiful lamp that doesn’t work is useless. The lamp has to function and then look good. With email marketing, it’s the same principle. You’ve got to get the foundations right, and it’s got to be functionally sound. It’s got to give customers what they need. Then you can build on and test and enhance and get more sophisticated.

 It’s even things like, you know, splitting out different types of customers. So the first time somebody subscribes to an email, how would you warm them up and make them feel that the email’s worth it and they’re getting something of value? How about a “thank you” for signing up? “Hey, did you know? How about this? If you’re looking for help, we’ve got x, y, and z.” The same with the new registration on the ecommerce site. They’ve registered but they haven’t bought. How do you make them feel good about registering with you? If they’re a first-time buyer, how do you thank them? How do you reward them for being a first-time customer and then show them other things that are of value to them? If they’re a second-time buyer, how do you increase the reward?

 Aravindh: All right. Very insightful. Now coming to the part that I’m sure most of the audience are eagerly awaiting: cart abandonment. Without a doubt, it’s the most difficult challenge facing e-store owners or marketers. What are some of the best practices to recover abandoned carts? 

James: Oh, there we go! It’s the million-dollar question. I mean, you’re right. I think cart abandonment is only increasing after Covid-19. Because, people are online more; browsing more.

Firstly, don’t panic. Cart abandonment is a natural behavior. There will be some carts you can recover that are mostly a result of poor UX and information, or people are just a bit unsure about doing it. But there are some carts you can’t recover—people are price comparing and shopping; they might have gone on to Amazon and bought it cheaper; or they never really fancied buying it. They were just having a bit of fun browsing or they were an annoying consultant like me who created a cart to see how the website works. So you’ve got to understand that dynamic.

 But then the rule I guess is do something even if it’s basic. Get it in place. I work with a jewelry client, and they didn’t have a cart abandonment setup. They spent months deliberating how they should do it. We just put it live and said, “Enough, this is ecommerce. If you don’t do it, you’ve lost your customer.” They instantly got recovered revenue. Now you can make it beautiful. You’ve got to have something. That’s the starting point. Then think about other elements of the ecommerce environment that you can use to stop somebody abandoning before you have to send them an email. It’s things like exit intents like a slide-out panel when someone goes to leave the site. A slide that basically says, “Hey! Is there anything else we can help you with? Was there anything wrong? Or, did you know that you get free delivery and free returns?” Things to take away the known barriers to purchase.

 I’ve done a lot of work with accounting and financial services company in the UK. We built a global program for them. We did a lot of testing around the exit intent stuff on the site to minimize the need for emails to have to get people back. I think the general rule is three emails. The first email gets the highest response. The second and third lower. But overall, if you only send one, you get a lower net response rate. So send an email as soon as a person has abandoned. It’s got to be focused on service—not trying to sell and not giving people a discount. If you just shove a discount in, you just train people to wait for the discount, and therefore you kill your margins. So the first one has got to be about, “Hey, we’ve saved your cart.” Let them know how long it’s safe. Some sites only save items for a certain amount of time in the basket. Tell people. Be transparent and say, “Look, don’t miss out. Your basket’s safe for 48 hours. Here it is: use this link. Have you got any questions? Can we help you? Our customer service team is here to help.” Things like that work brilliantly because if they did have a doubt, they can quickly click into the site and go to a live chat or they can pop an email—whatever they want to do. Even embedding links within those emails to open messengers and stuff like that on the phone. So I think there it’s about making it service-based.

The other thing about making it service-based and not marketing- and sales-led, especially in the EU where we have GPDR, means that unless people have opted in, you are not allowed to market to them. This means that you can fall foul of the legislation.  You can end up with a big fine if you’re caught. If it’s service-based, you can send those out under legitimate interest and say, “You took the action of adding an item to the cart, so we’re letting you know that if you need any help, we are here.” That can help you to get a larger pool of emails out than if you’re trying to say, “Here’s 10% off. Buy this as well.” So I think it’s about thinking about what’s good for the customer.

Aravindh: Great! Yes. You also partly answered the question that I have for you next. Let me go ahead anyway. Like you mentioned, there are store-level reasons why people don’t check out: bad UX, transactional failures, and more. But we have to tap into the psychological side of things as well, right? (What people exactly think at that point in time?) For instance, I add some items to the cart hoping that the price would drop later. Some people doubt the quality of the product. So on and so forth. How do we tap into that area and how do we craft emails understanding or premeditating the expectations or the mindset of the buyer?

 James: Yeah, so really good points. The first thing is you need to understand your customers. If you have no customer insights, start by putting surveys out to your customers or onto the site. A good one is an exit intent survey if somebody abandons like a product page without adding to cart or somebody abandons a cart. A survey saying, “Was there anything wrong?” People say, “Your delivery is too slow. The price seems a bit high. I’m unsure whether it will fit. I don’t like it.” For those listening, if you haven’t, I recommend reading Robert Cialdini on persuasion. There are seven persuasion tactics he talks about. He’s a very well-known psychology professor of marketing, and you can start to think about each of those and how it could be applied. A good example is social proof: we respond to other people who are like us and we trust them more than just a brand. I’ve done this in B2B where they were the top-rated in the market and they have over 10,000 customers rating them an average of 4.8 out of 5. Putting that in the content like, “Join 10,000 other happy customers” has a much bigger impact than you saying, “We’re great.”

 The other thing you can do is the reassurance about the return. Free returns all year round take away the worry that they might be thinking, “Oh! What if I really don’t like it?” Then think about USPs. This is something that people don’t do. Simple reinforcements like free delivery on all orders, the top XYZ in your country, and more. For example, I did some work with a company called Sage; they were the only HMRC-approved accounting software at that time. It was huge for small businesses who were worried about getting things done. They don’t have big legal and financial and accounting teams. So this was the worry for the small business: “Christ, if I get this wrong, I could get fined instantly.” It was a huge, take-the-fear-away thing. So you’re right. It’s understanding people’s motivation to buy and people’s fear, and then looking at that and adding on. Use genuine unique selling points—don’t simply say, “We’re great.”

 Aravindh: Great insights. I want to touch the aspect of demarcation. As we’re talking about cart abandonment, I think it’s true that we have to demarcate the audience into two types—visitors and customers—and have different strategies in place for both. Is it really possible? If yes, how do we systematically achieve it? Is there a procedure?

 James: I guess this is actually hard. You can’t just have a generic ecommerce platform that instantly triggers emails based on a template. It becomes harder if you want to capture the emails of an abandoned cart, then segment them based on which is a recognized account and which isn’t. Because you then have to do lookups, and that requires a process flow, and that is harder. It can be done, but it takes more effort and development to set up and get those emails flowed into the right segments. So I don’t think people just starting out would want to consider that. I think they should start simple, generic, and get something that’s practical and works and at least recover some revenue. If you recover revenue, you’ve got money that you can turn into a business case to say, “Right, we now need to take it to the next level.” But it also depends on the volume: if you’re losing five or 10 carts, the extra effort and cost to set up flows based on whether you’re a registered customer or not is much harder to prove that business case than if you’ve got hundreds and hundreds of them. So I think it’s about reassuring and helping them rather than focusing on what’s stopping them from buying. I don’t think you have to worry so much about splitting them out. That, for me, comes later. There’s probably other people that can give better examples of people doing this. I don’t know many of my clients who get to that level, to be honest.

Aravindh: Okay. Right. Another important aspect of automation is following up with the customers. People who have purchased. What are some points to keep in mind while building an automated purchase follow-up series?

 James: Yeah, this is another good question to get stuck into because there are so many different answers to this. So let me give you my perfect answer to what I love to do if people are willing to do it: as soon as someone orders online, on the order confirmation page they have a net promoter score. A survey. It’s also sent out in the email all the confirmation. That net promoter score is basically them telling you whether they’ve enjoyed their experience or not. “How likely are you to recommend us after your experience today from one to 10?” That can then change your behavior. In the UK, there’s a company that provides a solution for this, and they work with brands like Arena Flowers. They change their behavior towards customers based on the result of that survey.

So if somebody rates you a one out of 10, it means something has gone wrong fundamentally. Maybe they’re a crazy customer. Maybe they’re generally upset about something. That means sending them a next follow-up like, “Hey, we’d love a product review” is not a good idea. Fix the problem before you start sending your product review emails. So actually, you can start to change your behavior based on whether the customer’s been satisfied by their online experience. That to me is about how you improve the follow-up process. So yes, they have to have all the confirmation and all those standard transaction emails, but find out whether you’ve given them a good service. If you haven’t, look to improve and fix the issue. If you have, look at other things like, “Hey! We’d love you to follow us on social. Did you also know that we have XYZ? Or, did you know that we have a subscription service for delivery?” There are different things you can say to people based on whether they’re satisfied or not. Now, you still do your customer reviews because you need to give people a chance to review. But if you delay the customer review email by maybe two weeks after purchase, you have time to gather those responses, assess, and then address any potential issues.

Aravindh: All right. So one final question before I let you go. The year is still relatively young. What are the trends that you foresee in the ecommerce industry? Here’s some context to this question: Ever since the pandemic made landfall, there was sort of a paradigm shift; people started purchasing more online. It wasn’t that people weren’t inclined to online purchasing before, but a lot of people started coming onto the bandwagon. Now we are almost slowly returning back to normalcy. So is that going to affect the trends? Or, what are the things to watch out for this year?

 James: Do you mean specific to email or broader ecommerce?

 Aravindh: In the ecommerce industry.

 James: Okay. I think Mckinsey said there was 10 years’ growth in two months in the US in ecommerce, and the share of ecommerce has gone up. It isn’t going to suddenly change and come back to where it was. There’s been a steep change in terms of percentage share in most markets. What’s happening though is that the growth year and year has slowed right down. In 2022, in some categories, people are predicting that actually the sales will be lower this year than they were last year. For example, the sale of furniture went down last year. So there is inevitably going to be a kind of plateau this year. So I think that’s going to surprise a few ecommerce teams who’ve seen this great demand.

 We’ve got to remember that people haven’t just all switched online. There is still offline and online working together, and we need to maintain that focus. Ecommerce isn’t just about selling online. So what’s happening this year is there’s definitely a keenness and looking at how they better improve customer loyalty, and understanding that loyalty is not just about points and money off; it’s about giving people reasons to shop, and this ties in lots of wider themes. It’s things like green ecommerce and eco credentials, so the younger generations are much more on it than older generations, although there’s still a lot of interest in the environment for the older generations. But the impact of people who demonstrate true environmental credentials and sustainability in their business influence shopping decisions. So people need to be more transparent about it and honest and not try to agree much by claiming things that aren’t true. Because, there’s a lot of backlash when people say that we have an environmentally friendly supply chain and are proven to be wrong. So that’s really important there. Everyone’s now talking about the Metaverse—there’s an obsession with it. I hate that word. But there are some tangible ways in which ecommerce is benefiting it, and there are some big brands out there using the virtual worlds to look to increase their brand penetration and to drive sales and create unique propositions in there. I think ecommerce is not going to be a massive thing this year, but it’s almost like the start of mobile when people are like, “This is interesting.” People are starting to look at the applications, and there’ll be more people experimenting. I know a few looking at NFTs at the moment for things like proof of ownership for a premium product. So you buy a premium product, and the way of guaranteeing that you can prove that it’s yours if it gets stolen is that the serial number is linked to an NFT that is permanently in the blockchain, and nobody can deny that. So there’s different ways people are looking at that element of it.  But I think primarily more people are getting serious about data. (You’ve touched upon it today.) They’re making sure they have the right data and being able to validate the impact of the decisions they’re making, and using data to automate how they’re able to help customers make better decisions on the website for what they show.

 I guess there are so many trends. It’s just that some trends are more relevant to certain businesses than others.

 

 

 

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