With email competition increasing, it’s time to rethink your tactics. Those marketers who optimize their email strategies to create an engaged audience, and relevant communications can increase their net profits on average 18 times more than broadcast mailings.

The Evolution Of Email Marketing

1) Batch & Blast

This is email marketing in it’s infancy. Everyone gets the same message about your new beach ball, including Sally, who lives in the Nevada desert, and has a phobia of water. As your list grows it’ll get harder to keep messages relevant, which will likely be reflected in a higher than average unsubscribe rate.

2) Profile Driven

In this stage messages are segmented based on information subscribers provided when they signed up, or by demographic information in your customer relationship software. An example might include sorting your business customers by sic code, and sending off a Valentines themed email offer just for Jewelers.

3) Persona Driven

It’s time to kick relevancy up a notch. In this phase persona’s are developed for your customer segments, describing who they are, and answering questions about their behavior. For instance, what keeps these Jewelers awake at night? Finding new customers to grow their businesses. If that’s the case, that Valentines day email might include tips for marketing their business on the holiday along with one of your products that will help.

4) Behavior Driven

Customers actions are the best predictors of future behavior. In these scenario it’s important to document normal customer behavior, and set set up trip wires for customers who deviate from the norm. For example, your data may show that the Jewelers segment on average, repeat purchasing your product every 60 days. So at 60 days you mail out a discount offer to customers who haven’t purchased again by this point. Now you’re beginning to manage customer defection.

5) Predictive Messages

Predictive messaging also relies on behavior while also combining other inputs like personas and demographic information to further segment customers. Instead of blanketing all Jewelers at 60 days with a discount message, you might find accounts with higher order sizes tend to space their orders out over longer periods. So instead you send a discount offer to these different customers at 60 and 90 days. At this point you’re not just managing, but maximizing your email program for maximum profit.

How Evolved In Your Email Program?

Companies fall all across the email marketing evolutionary spectrum. Level of sophistication depends on a lot of factors, like technological aptitude, industry, etc. This post illustrates the power of one-to-one messages, and that the potential for exponentially increasing profits are worth the time and financial commitment to improving your email marketing.

In that instant the little yellow canary inside my head dropped dead. The fumes of misinformation and general cluelessness KO’d the poor bird.

First, Alexa is flawed. So please stop quoting it. More importantly, stop focusing on website traffic. It’s not a useful metric, unless you’re earning money from ads in which case impressions do matter. No sane owner smiles at the amount of foot traffic their retail store had that day, they’re happy with the cash in the register. Diddo for your website.

What should you measure? Nielsen said it best, the formula for website success is:

B = V × C × L

Where

• B = amount of business done by the site
• V = unique visitors coming to the site
• C = conversion rate (the percentage of visitors who become customers); note that the concept of conversion applies not only to ecommerce sites, but to any site where there is something you want users to do. For me it’s people subscribing to my feeds and downloading my PDF resume and visiting my LinkedIn Profile. You can apply a dollar value to these actions.
• L = loyalty rate (the degree to which customers return to conduct repeat business)

Everyone is trying to increase traffic, this is evident in the number of articles showing you how to get your writing on the front page of Digg. So, if everyone is gunning for volume you can win by better persuading your visitors to take action and providing a reason for them to return over and over.

Focus on conversion and increasing loyalty. Please stop glorifying traffic. If not for yourself, for gods sake, do it for the canaries.

According to the survey, 34% of marketers are planning to introduce a formal ROI tracking system, with over half saying that quantifying and measuring the value of marketing programs and investments remains the top challenge in the year ahead.

However, using ROI to gage marketing effectiveness provides an incomplete picture. Let me illustrate with an analogy. My sage finance professor, Dr. Stendardi, taught us padwans that when using Ratio Analysis to evaluate the fiscal health of a company you need to compare multiple ratios. Liquidity, asset management, debt, profitability ratios – all of them put each other in context.

What we seem to be trying to do is equate marketing ROI with financial ROE.

Breaking down marketing into short sighted campaigns, and linear processes. When in fact it tends to zig zag.

I say that ROI is good for evaluating our tactics, but it will not guarantee future success. For analyzing our strategy we should rely on long term metrics, perhaps Customer Life Time Value, Return on Objectives, etc.

Care to weigh in on the topic?