How to Manage Customer Relationships with CRM

It‘s cheaper to retain customers than it is to attract new ones. It pays to look after them.

Wouldn’t it be great to have a tool to help us track our interactions with customers to understand their needs better?

And manage ongoing relationships with our customers as well as customer leads.

It is cheaper to retain customers than it is to attract and convert new ones.

Meaning we’re more profitable!

This blog explores Customer Relationship Management — explaining how it works and its benefits of using CRM.

---

What is Customer Relationship Management?

Customer relationship management (CRM) is a strategic business approach to managing interactions with existing and potential customers.

Grounded in the foundations of relationship marketing, CRM is often used to describe technology-based systems that manage customer information and solutions.

“Relationship marketing theory provides the foundations of CRM, which is “the process of acquiring, retaining, and partnering with selective customers to create superior value for the company and the customer.” (Parvatiyar & Sheth, 2001)

The focus is on customer retention through streamlined processes and staying connected to customers to improve the relationship. Firms manage and analyse their interactions with their past, current and potential customers.

Firms can use numerous customer communication channels to compile data, including a company’s website, telephone, email, live chat, and social media.

The ultimate goal of CRM is to increase sales.

A Brief History of CRM

Customer relationship management dates to the 1970s. Initially, businesses used surveys to evaluate customer satisfaction. As computer technology developed, companies used spreadsheets to categorise and analyse data and create lists of customers, which became the basis for database marketing.

In the 90s, CRM evolved as more large tech companies such as Oracle got involved and created customer software solutions, including sales force automation and customer service.

With the advances in the internet, the early 2000s saw CRM migrate into cloud technology, meaning users could access it online from any computer.

Being online also removes the burden of installing and updating software, keeping IT costs lower and being extremely flexible for businesses to upgrade as they grow.

Industry-specific software or full-customised CRM was also replacing standardised CRM options to meet businesses' needs further. Industry data suggest Worldwide spending on CRM will exceed USD 110 Billion by 2027.

“Uncertain markets and dwindling brand loyalty are critical factors which are leading service-based firms to adopt CRM as a business strategy.” (Dewnarain, Ramkissoon, & Mavondo, 2019)

---

The Benefits of CRM

A customer-centric marketing strategy allows firms to create and maintain relationships with their target market. CRM is a vehicle for this.

With rising customer acquisition costs and increasingly price-sensitive customers (They do not like to pay more), creating long-lasting, mutually beneficial relationships is key to increased customer retention.

The better we are at providing solutions to customers, the higher chance they will remain loyal, increasing their lifetime value to a firm.

CRM is a comprehensive approach to providing customer solutions.

Information kept and organised about leads and customers, as well as every interaction that takes place. If customers regularly interact with multiple people on your team, it allows everyone in a firm to keep track of conversations.

“Organisations today must focus on delivering the highest value to customers through better communication, faster delivery, and personalized products and services.” (Chen & Popovich, 2003)

Some of the direct benefits to businesses of using a CRM are:

• Increased ability to target profitable customers.
• Enhanced salesforce effectiveness and efficiency.
• The marketing and sales teams function together more cohesively.
• We have improved customer service effectiveness and efficiency.
• Products/services customised to individual customer needs and preferences.
• Communication channels integrated into a single platform.
• Increased responsiveness to changing customer needs.
• Improved data to more precisely segment customers based on their characteristics/needs.
• Individualised marketing based on customer behaviours.
• Increased opportunities to cross-sell and up-sell customers.
• It's a key component of a sales funnel.

---

The Functions of CRM

The underlying function of CRM is to build customer relationships and to manage these as they mature through distinct stages. Firms keep a database of customer information to understand better those customers and better meet their needs.

The firm helps them analyse their customer data to identify sales opportunities and manage customised marketing campaigns from a central location.

Integration

For large organisations, one of the most significant benefits of CRM is that everybody has access to the data, making it easier to collaborate across teams and the entire customer lifecycle.

Sales, marketing, and customer support become integrated and automated.

Every detail about individual customers is kept, such as who they are and how their interaction with the firm.

Knowing these details helps everyone do their job better as it provides context about customer’s needs and situation, so one staff member can pick up the conversation where the last one left off.

Firms can manage inquiries across channels without losing track of conversations.

“To some, it meant direct mail, a loyalty card scheme, or a database, whereas others envisioned it as a help desk or a call centre.

Some said that it was about populating a data warehouse or undertaking data mining; others considered CRM an e-commerce solution, such as the use of a personalization engine on the Internet.” (Payne & Frow, 2005)

Marketing

CRM allows for marketing automation to make it more effective and efficient.

Firms can set up repetitive marketing tasks such as social media posts or email marketing to be sent to groups of customers at various times, with different messages, based on customer segments' individual needs and behaviours.

Marketing aims to put the right message in front of the right people at the right time. CRM systems also monitor how customers preferred communication method.

Daily emails? Weekly emails? Monthly phone calls?

Sales

Automation of the salesforce is another crucial function of CRM. Wherever a customer is in the sales cycle (buyer decision process), firms customise their communication for their situation (assuming we know enough about them).

CRM tracks a customer’s history with the company to know as much about them and tailor their communication.

It is critical to categorise recent sales leads accurately, as special sales promotions with different offers can be targeted at diverse groups of customers to fit their needs best.

Firms can focus and prioritise the right leads that are likely to be the best opportunities to close profitable deals. Firms do not want to waste time and resources on prospects who will never become profitable customers or clients.

Sales reps can work more efficiently, and sales forecasting becomes more accurate.

Customer Support

Another benefit of CRM is that customers are served better on a day to day process.

Direct customer service technologies mean that support becomes more personalised and automated, and customers supported through multiple channels.

CRM keeps a record of every customer interaction, the extra insight into customers helping business be more constructive with improving their customer service experience and providing better solutions.

Data Analysis

Another valuable function of CRM is the ability to analyse customer data collected through multiple digital sources.

Data mining helps businesses to learn more about their target customers.

We can find out where our sales come from, what characteristics our customers have, the best way to communicate with them, and how to best cater to their needs.

Through analysing our data, we can find patterns in consumer behaviour that informs our decision-making. Identify any potential issues, as well as what is going well.

Analytics provides all sorts of customer information, such as their past sales and how they reacted to previous marketing efforts. If we find out that certain customer groups are not purchasing, we can change our offer.

It can be a trial and error process better to understand their buying behaviour and spending habits over time.

---

Final Words

In summary, a value proposition is the summary statement of why a customer would choose a company’s product or service. It frames how they uniquely provide value to customers.

This article has discussed the importance of creating a value proposition and the steps a business can take to create its own and differentiate itself from competitors.

Thank you for reading.

If you enjoyed the content, you might be interested in this article on enhancing customer loyalty.

12 Ways to Use Direct Marketing

Mass marketing is inefficient and expensive. Would it not be great if you could cut out the middleman and advertise to customers direct? The good news is, you can!

Direct marketing uses advertising tactics such as email marketing, mail drops and paid ads online to reach customers with targeted marketing messages.

This article explores direct marketing, explaining how it works and the different direct marketing tactics that businesses can use to reach customers.

“Retailers use direct marketing as one marketing communication tool in their overall communication portfolio to reach existing customers. (Uematsu, & Mishra, 2011)

---

What is direct marketing?

There are two main advertising variants to a marketing strategy — mass marketing and direct marketing.

Mass marketing uses mass media such as television, radio, and newspapers to broadcast messages to random publics.

Direct Marketing is advertising that seeks to achieve a specific action from a selected target audience of the most likely buyers.

The use of direct marketing has grown considerably in the digital era, as the cost of collecting and storing customer data has reduced. An increase in distribution channels’ available online provides direct access to the customer.

As the name implies, communication and/or distribution is direct with the consumer, bypassing a third party such as the mass media.

 Types of direct marketing include:

• Email marketing
• Direct mail
• Fliers
• Brochures
• Couponing
• Catalogue distribution
• Postcards
• Promotional letters
• Loyalty cards
• Insert media
• Couponing
• Door-to-door sales
• Telemarketing phone calls
• Text messaging
• Messenger
• Websites
• Social media
• Targeted online ads

There is some disagreement about whether some forms of promotion are direct marketing.

Some marketers consider television infomercials, newspapers and magazine advertisements, and outdoor advertising direct marketing. But only if it has a direct response aspect, such as a toll-free number.

However, these marketing methods are not as targeted as most direct marketing forms, so I do not include them here.

Most of these direct marketing methods are explained later in the document.

---

The objectives of direct marketing

Direct marketing campaigns aim to persuade consumers to action, providing tangible and measurable results, such as purchases, signups, or requests for more information.

While other advertising methods such as content marketing aims to educate prospects rather than sell, direct marketing intends to encourage a specific action.

Some of the reasons for using direct marketing are:

• Improve sales of specific products
• Clear discontinued stock
• Increase customer retention and loyalty
• Follow up on promotional offers.

A call to action

Direct marketing commonly uses incentive-based information where it offers consumers a benefit to act on. Called a call to action (CTA), they depend on your industry and the target consumers.

Examples of CTAs are:

• Click the link
• Visit our website or store
• Call us to get more info on our products or services
• Subscribe with your email address
• Purchase here
• Register your interest
• Limited-time coupon
• Sign up now
• Invitation-only event
• Discounted membership
• Make a booking

---

The benefits of using direct marketing

There are several benefits to businesses using direct marketing. I will talk about some of those now.

Marketing is measurable

The first significant benefit of direct marketing is clearly measurable results.

Direct marketing is more straightforward to measure than many other types of advertising. With a process called data mining, firms can use analytics to improve their results.

Online, firms use pixels to measure campaign results, such as identifying who has clicked on an advert or used a unique discount code.

Physical mail drops are harder to measure. Still, any noticeable increases in sales of items over the campaigns can be attributed to the advertising. 

The most important deliverable is whether there is an overall return on investment for the campaign.

As well as measuring the effectiveness of your marketing, you can test new markets and trial new products or services.

“Successful direct marketing initiatives require firms to predict the behaviour of specific individuals.” (Allenby, Leone & Jen, 1999)

Marketing becomes optimised

By monitoring and analysing their processes, firms can improve future campaigns’ success by tweaking their strategy.

Firms can use small direct marketing campaigns to test marketing effectiveness, such as test A / B tests. They can try different variants of the ad's components, such as subject title, images, call to actions, or even when they send out a campaign.

New products can even be tested on small market segments before mass marketing to evaluate customers desire for those products and services.

“Instead of promoting to customers indiscriminatively, direct marketing studies customers’ characteristics and needs, and selects certain customers as the target for promotion.” (Ling & Li, 1998)

Marketing is targeted

Indirect marketing uses marketing techniques broadcasted to random audiences. Direct marketing, on the other hand, focuses on targeted lists of prospective customers.

Marketing targets the most likely prospects, which improves the response rate. For example, for a supermarket sending out the weekly specials, this will be location-based. It makes sense to focus marketing efforts on the people most likely to give results, right?

Direct marketing becomes more profitable the more targeted it becomes. You do not want to waste money marketing to people who will not be customers. Your marketing becomes junk mail or spam to these people.

To create targeted audiences requires database segmentation. Segmentation is the process of dividing the customer base into small groups with some common characteristics. 

People are grouped based on their criteria such as age, income, location, gender, occupation, interests and buying patterns.

Marketing is personalised

Because firms target marketing to a specific audience, marketing is also personalised to those customer segment’s needs.

Firms use information about their audience, such as age, income, and consumer behaviour, to create tailored marketing content. We want the audience to react, so firms must customise their message to increases their chances of resonating with the specific audience.

High conversion rate

Because direct marketing usually involves research to identify and focus on the customers most likely to purchase, it has a higher conversion rate than other marketing forms.

Furthermore, email marketing tactics are only contacting previous customers or people who have opted to receive advertising.

The audience already has a real interest in the firm and is more likely to convert again.

Direct marketing strategies allow producers to receive a better price by selling products directly to consumers (Uematsu & Mishra, 2011)

Low-cost

Direct marketing can be a small fraction of mass marketing cost because it eliminates the need for a middleman, such as an advertising agency. Moreover, because the audience chosen for a campaign is small and targeted, this also reduces the cost. Direct marketing can be done on a tight budget and still achieve results.

Enhanced customer loyalty

Direct mail is an excellent tool for building and maintaining relationships with customers and prospects because it is personalised.

Firms can combine direct marketing with customer loyalty tactics to increase the bond further. Examples of loyalty strategies include special discount offers, sending birthday messages and invites to ‘exclusive’ sales events.

Direct mail can be successful in re-establishing relationships with former customers who have not consumed it for a while.

---

Direct marketing strategy

As a marketing strategy, firms such as banks, insurance companies, and the retail industry increasingly use direct marketing. It can be a very aggressive form of marketing, so firms must carefully plan and implement it.

As the target audience should be people who have expressed interest or are likely to be interested in what you have to say, you need to develop contact lists. Having a robust database of customers and potential customers is key to the success of direct marketing.

“In direct marketing, this knowledge is a description of likely buyers or responders, and is useful in obtaining higher profit than mass marketing.” (Ling & Li, 1998)

It is vital to maintain an organised database and customer records. Data mining can provide an effective tool for direct marketing, discovering useful information about customers to be used in campaigns.

Campaigns are personalised to these audiences to capture their attention with relevant offers.

---

Direct marketing methods

There are several marketing methods firms can use to reach their customers. Many were named above. This section will outline some of the popular forms.

Loyalty cards

It entails giving loyal customers membership cards. Customers can then use these cards to access price discounts, free trials, and other offers. Combine your direct marketing methods with your loyalty program.

“Retailer direct marketing typically includes coupons or promotions bundled together with an advertising message.” (Lund & Marinova, 2014)

Couponing

The use of discounts through advertising media is called couponing, which can be an excellent way to elicit a response from targeted customers. Firms can send coupons by mail for customers to take in-store to receive a discount or a digital version.

Coupons are downloaded and printed or shown on the customer’s mobile phone. Firms can distribute digital coupons via company websites, social media, texts, or email.

Insert media

Delivering advertising inserted into shared media is called insert media. Often a one-page ad is inserted into other physical communication media, such as catalogues, newspapers, or magazines.

For this strategy to work effectively, it needs to be targeting the right audience. For example, an automotive store would not want their insert media inside women’s gossip magazines. The target audience should align.

Direct mail

Direct mail uses the mailbox of potential customers to deliver advertising materials. Campaigns often focus on people in a specific geographic area or customers on a marketing list.

There are several different types of direct mail. Types of direct mail are circulars, leaflets, or flyers distributed to everyone in the advertiser area.

This method can work well for local businesses whose products or services appeal to a broad audience. It is common with financial services, consumer goods and travel and tourism industries.

Catalogues, on the other hand, are usually only sent to consumers with a previous interest.

As well as letterbox drops could be handouts to people in the city or shopping malls. Postcards and envelope mailers also standard direct mail methods.

Telemarketing

Contacting potential customers over the phone is called telemarketing. Most consumers are not very appreciative of this approach, and in the age of digital marketing, it has become outdated. Telemarketing should focus on people with a higher probability of getting converted into actual sales to be effective,

Telemarketing can be a successful method for following up on other direct marketing campaigns. Leads are more qualified, and the call is not cold.

Door-to-Door

One of the more well-known and traditional direct selling methods, door-to-door, has a salesperson go out and knock on the door of homes. It can be a very laborious and frustrating job, with people not home or answering the door rudely when they see the salesperson.

It is common for real estate salespeople to find a property to list to satisfy buyers looking in a particular geographic area. Telecommunications and utility companies often employ a salesforce to use this method as one-on-one communication can be highly persuasive.

Door hangers are another form of door-to-door, which is a more passive form. Salespeople hang fliers over the door, and no actual interaction takes place.

Mobile marketing

Sending promotional material to users via their mobile devices is mobile marketing. It is a very low-cost way to reach the target audience. A targeted method as firms creates the database with customers and other interested people.

Firms send messages via text, including information about sales, links to website specials, appointments or information about the order status.

Messenger marketing

Creating a chatbot for websites or social media messaging apps helps brands automate answering customer questions with relevant answers. Commonly chatbots are designed to reach out to people browsing the page automatically and can even collect orders.

Email marketing

As one of the most widely used direct-marketing methods, email marketing is a simple, cost-effective, and measurable way of reaching customers.

Email marketing is easy and inexpensive to design, test, and send an email message. Businesses use content marketing to provide useful information to consumers to encourage them to join the mailing list.

Firms send emails regularly to generate new customers or give special offers to existing customers.

Online Ads

Pay per click (PPC) ads can be a beneficial form of direct marketing. There are three main types of PPC ads.

• Display Ads appear on the Web next to similar content direct mail.
• Search engines show ads next to organic (non-paid) search results based on search terms.
• Social media ads also use a PPC format; the users see the ads based on the advertiser's characteristics.

Social Media

Direct marketing on social media creates content for platforms such as Facebook or Instagram, communicating directly to which customers can respond.

Much of the content created for social media is about building trust and showcasing the brand rather than selling.

Only around 1 or 2 posts out of every ten on social media should be sales focused.

Website

Having a website is an integral part of direct marketing online. Many websites are also online store, so firms use many other marketing methods in conjunction with their website to increase their traffic. These methods include SEO, PPC ads, Blogging, and lead magnets.

---

Summary

In sum, the article has explored direct marketing as an advertising tool for businesses. 

I have discussed some of the benefits of using direct marketing, such as being measurable and targeted.

I define twelve direct marketing methods to give tips on integrating direct marketing into your own marketing strategy. Not every direct marketing method will suit every business. 

Remember, you need to analyse your situation, look at any data, and rationally decide which approaches will most effectively communicate with your target customers.

Thank you for reading.

I hope you enjoyed the content.

Dan

This article was originally posted on the BYB Marketing Blog

Using Digital Marketing to Reach Your Customers

The internet is a massive part of our lives. We use the internet for all sorts of things — to socialise, learn, or entertain us. It is where many of us spend a lot of our time. 

Because we are spending so much time online, the internet has become a powerful tool to communicate with customers and potential customers. 

Promoting our business on the internet is digital marketing, and companies have so many opportunities to put their brands out there to attract customers. 

Where do we start? 

Read on to find out more.

How to Use Affiliate Marketing to Increase Sales or to Create an Income

 

Affiliate Marketers act like a salesforce for a business. 

Marketing can be a costly investment for businesses. Big investments into advertising can be an elevated risk if you do not know the return.

Would it not be great if someone else better at marketing took up that risk and funded the marketing?

You could pay them a small commission fee for each sale. It may sound too good to be true, but it is not. This is called affiliate marketing.

This article explores affiliate marketing, how it works and the benefit it provides to both the seller and the affiliate marketer.

---

What is Affiliate Marketing?

Affiliate marketing is an endorsement-based advertising strategy, that earns promoters (affiliate) money when internet users act on that marketing.

Based on a model of revenue sharing, vendors (merchant) offer a financial incentive such as a commission, through an affiliate program. Affiliates earn a piece of the profit for each sale through creating marketing content to try redirect customers through a customer URL to the merchant’s product.

Affiliates can make money promoting products and services and make an income, without actually having any of their own.

For the merchant, it employs the help of affiliate to invest time and money into marketing your products or services. to expand their reach on the target (online) audience.

According to Mediakix, affiliate marketing spending increases every year in the USA, with around a 10 percent yearly increase in affiliate marketing spending.

Affiliate marketing refers to an online relationship between the so-called merchant and the affiliate, where the merchant pays the affiliate a commission to redirect potential consumers to the merchant’s website (Libai et al., 2003).

 

How Affiliate Marketing works

Affiliate marketing involves four different parties:

• The merchant,

• The affiliate,

• The affiliate marketing network, and

• The customer.

From a marketing point of view, there are two components: the merchant who has produced the product or service for sale and the affiliate marketer who promotes it.

With a traditional business model, the seller bears the risk that profit exceeds the overall marketing costs. However, an affiliate takes on the promotion efforts and then earns a piece of the profit from each sale they make. This is usually via a predefined commission, and the sales are tracked via personalised affiliate links.

For the affiliate, they just need to be good at marketing. It works similarly to somebody employed in sales on commission. Such as real estate agents. This incentivises their performance. This is a huge benefit to the merchant having a purely commissioned sales force and predictable marketing costs.

In the other hand, affiliates can create a revenue stream without investing in inventory or infrastructure.

“The key to successful affiliate marketing lies in the construction of a win-win relationship between the advertiser and the affiliate.” (Duffy, 2005)

Imagine via JustLearnWP.com

1. The merchant

The merchant is also known as the seller, vendor, or retailer. They are the party who created the product to market — it could be a physical object or a service. They could be a sole trader or a large corporation. Once the product is created, they are not required to be actively involved in marketing. They have others do the promotion, in exchange for a commission on sales.

2. The affiliate

Also known as the content creator or the publisher, the affiliates try to create appealing marketing to attract customers to the merchant’s website. They create content for the products to share on social media, blogs, and websites.

Affiliates often already have an audience or following on social media, so they choose products in their niche that meet the needs of their audience. For example, If I had built an audience posting content about fitness and health, I would not become an affiliate marketer for a candy company.

“There are thousands of affiliates, working for many different advertisers simultaneously, driving incremental traffic and sales in exchange for commission.” (Duffy, 2005)

 

3. The network

Many merchant/affiliate relationships are managed through affiliate marketing networks. There are two key relationships: The first is with the affiliate and the second is with the merchant. The network works as an intermediary between the merchant and the affiliate.

Affiliate marketing networks such as Linkshare, Commission Junction, and Clickbank facilitate the tracking of sales transactions, payments and product delivery. Their technology tracks all the activities and manages the commissions and the issuance of payments to affiliates.

These networks also serve as a database of products, out of which the affiliate can choose products or services to promote. The network facilitates the management of applicants, making the process of participation easy for both the merchant and the affiliate.

Amazon also has an affiliate network (Amazon Associates Affiliates Program), to help promote consumer products such as books and toys, sold on their platform.

4. The consumer

The consumer (or customer) make this relationship work. If they do not purchase, there is no revenue and the affiliate will not receive a commission. When consumers buy the product, the seller and the affiliate share in the profits.

There will not be a higher price for consumers purchasing through an affiliate, as the cost of the affiliate network is typically included in the price.

Email Marketing: A Tool to Strengthen Relationships, Improve Brand Awareness and Increase Sales

 

Email Marketing has become one of the most popular and effective marketing method and relationship management tool used by businesses since it rose quickly into prominence with the internet about 25 years ago. 

Pretty quickly, most people had a personal email address and were checking their email, making it a powerful tool to communicate with people.

This article explores the use of email as a marketing tactic.

---

What is Email Marketing?

Short for electronic mail, email is the sending of messages to one or more recipients, distributed by electronic means via the internet. Email marketing is a digital marketing tool that uses email to develop relationships with prospective customers and maintain and strengthen relationships with current customers. The end goal is to influence these people to make a purchase and be ongoing customers.

“Companies often list email as one of their most powerful marketing channels. To this day, the size of your email list is a demonstration of your reach and thought leadership. However, your email marketing campaigns should be part of a holistic approach to educate your contacts about your company.” (Georgieva, 2012)

The popularity of email marketing has been a part of the ongoing trend away from a product-focused marketing strategy to a customer focus of customisation and relationship management, to satisfy the needs of each customer.

Email marketing has been growing since the mid-1990s and is a widely used marketing tool by the majority of B2B and B2C companies. In 2015, one study indicates that over 80% of firms use email as part of their marketing strategies (See Zhang, Kumar, & Cosguner, 2017).

The benefits of email marketing

Email is a powerful marketing tool, with several benefits for businesses using it to build customer relationships and increase sales. Using their database of email addresses, businesses can design email marketing campaigns, personalised for diverse groups of leads and customers. Some of the benefits of email marketing are:

• Brand awareness — keeps the brand top of mind and people informed about what you offer.

• Speed — a quick output and quick response for lead generation.

• Segmentation — allows you to selectively email members of your database depending on their behaviours.

• Cost-Effective — Low cost per contact for customer acquisition. A better return on investment many other forms of marketing.

• Targeted — you are sending relevant materials to your audience.

• Customer Dialogue — encourages a two-way dialogue with customers, where communication is one way with many other marketing methods.

• Trackable — Analytics allows you to track the performance of your emails.

• Conversion — turn prospects who are interested in your industry or your products/services into customers.

• CRM — customer relationship management helps maximise the lifetime value of customers by increasing customer retention and repeat purchases.

Objectives of email marketing

Email Newsletters are great not only for marketing to prospects but also for nurturing your existing customers. Some of the objectives of using email marketing are:

• Send recipients to other marketing content such as landing pages with exclusive offers, blog posts or other valuable content.

• Communicate with a community, customers, employees or other stakeholders to generate a reaction or a result.

• Inform the reader about a new offer or send them to a blog post.

• Maintain and develop long term relationships with current customers.

• Motivate customers to finish a purchase who have items in their shopping cart that was abandoned.

• Increase sales by converting more leads into customers and selling more to previous customers.

Analysing the results of your email marketing

One of the major benefits of email marketing is the ability to monitor subscriber engagement and interest.

It is a process of continual improvement — testing and tweaking your email content and database management. To analyse the performance of your email marketing, there are several key metrics to help measure the performance of each campaign against previous benchmarks.

For example, analysing the interaction that people have with your website after they click on a link, this can help you pinpoint how to improve the user experience on your website. Two different landing pages could be used to test which one receives better results.

• Open rate is the proportion of people opened the email. But this can be an inaccurate gauge as customers who are active in opening a firm’s emails may not be active in purchasing and vice versa. Some people are more responsive to emails. Some people like to browse. Other people may purchase but never open their emails. Therefore, it is important to track more factors than just your open rate, such as tracking your click-through rates and conversion rates.

• Bounce rate is the total emails sent that could not be delivered to the recipient’s inbox, If one particular campaign has a lower than average delivery rate (high bounce rate), examine the subject line and content of that message to check if there’s something that could have flagged it as spam.

• The list growth rate is how fast your email list is growing. This is calculated by subtracting opt-outs and hard bounces from the number of new email subscribers gained per month.

“Be clear to your target market about what they will get out of subscribing to your emails. Give them a clear description of what the value proposition is. For example, will your emails offer: (1) tips and tools on how to run their business more efficiently, (2) product updates from your company, or (3) special offers via email? Your audience will want to know “why” they should subscribe before they decide to clutter their inbox with even more emails.” (Georgieva, 2012)

• Unsubscribe rate is the proportion of people in your database who unsubscribe from receiving your emails. This is not always a reliable picture of the health of your email list, however, as many subscribers no longer want to receive emails will not bother to go through the formal unsubscribe process. They will just stop opening email messages and delete them instead.

• Click-Through Rate (CTR) is a foundation of email marketing analytics, as it indicates whether the message was relevant and the offer compelling enough to check out. This measure how many people click on the offer or other link in your email.

• Conversion rate is the proportion of people who clicked a link and completed the desired action, such as purchasing a product. This is also dependent on factors beyond the original email message, such as the quality of your landing page or the offer itself.

“Conversion rate is the ultimate measure of an email campaign’s effectiveness. The higher your conversion rate, the more relevant and compelling the offer was for your audience.” (Georgieva, 2012)

• Revenue per email measures the ROI of an email campaign, calculated by dividing the total revenue generated from the campaign by the number of emails sent. This is only relevant if you generate a lot of direct sales from email campaigns.

Spam

Because it is so cheap and accessible (anyone with an email address can send a mass-email), email is used as a tool to spread spam emails. Spam is unsolicited digital communication sent out in bulk to random email addresses without consent.

Spam has caused email marketing to leave a bad taste in the mouth for many people. We’ve probably all received an email or two from a Nigerian royal or long-lost family member promising us millions of dollars.

“Low production costs spur greater production, inducing entry to the industry by legitimate and not-so-legitimate marketers, which further increases the volume of email messages sent. As a result, consumers are awash in a sea of ads and information, some useful and some not.” (Pavlov, Melville & Plice, 2007)

The significant difference between spam and genuine email marketing is having an opt-in policy. If businesses keep rigorous with this, it means they are only emailing people who consented to receive them, and the business will not get any trouble. Most countries around the world now have anti-spam laws, so its best businesses are cautious with who goes into their emailing database.

Database management

A database can be powerful. But only if managed correctly.

A database should be continuously updated to make sure it stays relevant. If a user has been emailed 20 times and has never opened one of those emails, they probably should not be emailed once a week. You might email them once every 6 months or remove theirs completely. Your metrics will tell you who is no longer engaging.

Database members should be categorised so you can best meet their needs. Group them based on some common characteristics and behaviours.

Continually work to add new contacts to your email database, as the natural churn rate of an email list can be 25% or even more per year. Make sure you are gaining new relevant people on your database by providing a benefit to them by being on your mailing list (exclusive offers, gifts, industry updates etc).

Software such as Mailchimp or Constant Contact will help you manage your database as well as setting up your email marketing. Some systems will also you to set up your whole sales funnel with landing pages for lead generation, as well as for analytics and reporting to allow you to monitor the performance of your email marketing campaigns.

Email marketing strategy

Email marketing is about more than sending your latest offer out to your database once a month. Businesses must think of it like designing marketing communication campaigns — because they are! The objectives of email marketing should be clearly defined, who the target recipients are, the content must be developed to fit the purpose. Make sure it provides value!

The email campaign should be tested on a small sample, tweaked and then sent to the segmented members of the database. The results should then be measured to see what you can do better next time.

As well as immediate results, businesses should consider how their strategy will affect their future profitability. If your business sets up lead nurturing, emails are sent out automatically to new leads, according to the schedule you set up. lead nurturing is all about understanding the nuances of your leads’ timing and needs- tightly connected series of emails with a coherent purpose and full of useful content.

Tying a series of emails to a specific activity such as joining a mailing list, and then sending them an automated series of emails to learn more about their behaviour and potentially influence a purchase. The lead is qualified over a period with automation, saving a business time and energy.

Leads should be segmented into groups of buyers as you learn more about them to better meet their needs and provide them value. Targeted marketing has a far better return on investment than mass marketing — so do not be tempted to send the same email to all your contacts!

Email is a vital component of a marketing and sales funnel — where the objective is to turn as many leads into sales as possible. But email should be part of an integrated marketing approach — email does not work in isolation.

Your marketing emails need to be complemented by other efforts, such as search engine optimisation and content marketing on social media. If you blog, send people to your blog via your email and encourage people to sign up to your newsletter at the end of blog posts.  

Your marketing strategy should outline how your individual marketing efforts complement each other.

Email content

What goes into an email? Of course, this will vary depending on the firm and its objectives. But there are some general rules when it comes to the content of email marketing.

The email title must convince the recipient to open the email. This is key. It must be related to the content of the email (stay away from clickbait), but at the same time be compelling enough that the recipient is curious enough to open the email. Because many people check their email via smartphones, long titles will not be displayed in full. Aim for 5 to 9 words.

“In the Subject: line Each word makes a critical difference in whether your message is opened at all. Once its opened, you only have seconds to capture the readers imagination. You have to grab their attention and keep it.” (Sterne, & Priore, 2000)

Your content must be brief and relevant for the recipient. Grab their attention right away, by containing the most information in the first paragraph. Try and keep it the length to under 100 words.

Use a personalized greeting at the beginning of the email and a clear call-to-action at the end of the email. Include a couple of hyperlinks to other useful content such as a blog or video on your website, or a custom landing page that contains more information (find out more, or to order).

An option to unsubscribe must be available. Email marketing software with automatically using an unsubscribe option.

The layout and design of email marketing are important — especially if it is a newsletter. But you do not want to go over the top trying to make it aesthetic, simple can be beautiful. Try to use a maximum of two colours.

Include one or two images in the email, one of those can be the company logo for brand awareness. Make sure the images have alt text for those not viewing the email in HTML (quite often images are turned off automatically).

Your contact information as well as social-following buttons for your social media accounts should be at the bottom of the email.

How many emails should you send?

The right number of emails to send is difficult to pinpoint, as it will depend on your customers. If you are emailing qualified leads, it might be once or twice a week. Other customers, once a month or once a quarter might work better. It will depend on the engagement level of your audience.

“Sending the right number of emails is critical for the firm’s profitability, especially since most customers tend to complain about the large number of emails sent by firms.” (Zhang, Kumar, & Cosguner, 2017)

Many companies start to send fewer emails to keep subscribers. However, the frequency of emailing does not necessarily negatively impact subscriber retention. There can be email overload, for sure. But also, ask yourself if you are emailing the right people with the right message.