Email marketing is one of the oldest digital channels and it is in the “plateau of productivity” based on its effectiveness. Email delivers excellent marketing results as it is flexible, direct, measurable and dynamic.
We are able to gather marketing insights and learn what factors are influencing customer behavior by analyzing our proprietary data from across a variety of industry sectors of North American B2C & B2B clients.
There are many components of an email for marketers to master. Focusing on what matters most leads to significant improvements. Great email marketing is 70% science and 30% art.
Trends to Watch in Email Marketing
In this latest edition of our North American Email Marketing Benchmarks & Trends Report, we discuss the six major trends in email marketing including the impact of mobile devices on the customer experience, challenges with email deliverability, rise of contextual marketing, customer journeys, adaptive content, and the impact of marketing automation.
The mobile customer experience
The number of customers using mobile devices to respond and review email has outpaced both tablet and PC use. Based on our analysis, customers using mobile phones represent the largest proportion of opens at 47%, followed by PC at 37% and tablet at 16%. Email marketers have reacted to this change in customer behavior by delivering improved mobile experiences to their customers. Knowing the differences and similarities in behavior when a customer is using their mobile phone vs. their laptop/desktop and the demographics of the different user group is imperative. Also, improving the overall experience leads to higher open and click-through rates, which can be achieved by ensuring a seamless flow from the email itself to the landing pages and calls to action across all devices.
Deliverability becomes more important
As more and more marketers are recognizing the true potential email marketing as a key driver of business results, message frequencies and volumes have increased. As a result, the ISPs are increasingly relying on domain-based reputation, and have responded by implementing more strict filtering policies to judge incoming mail. While delivering engaging email experiences continues to be a top priority for marketers, they still need to keep their eye on email deliverability. While there is very little to be achieved from an engaging email that land in the spam folder of your subscribers. Maintaining a good sender reputation to pass filters and ensure your emails lands in your subscriber’s inbox should be equally as important as the content and contact strategies.
The rise of contextual marketing
Contextual marketing is getting the right message to the right person on the right device, and at the right time. The best way to develop the formula that addresses these variables is by leveraging data to guide your decision. Using analytics and data to create detailed views of the customer will drive automated strategies, including email triggers, workflows, personalization, segmentation, and predictive content which will, in turn, deliver the most relevant content to subscribers.
Customer journeys are a hot topic as they have much upside potential for marketers. Optimizing customer journeys is an efficient way to enhance customer experience and to drive response. Customer journeys usually represent 10% of message volume but generate more than 40% of conversions. Marketers now have data and useful tools to launch a series of highly personalized email campaigns. From our work in guiding customers to the next level, many businesses are under-skilled in journey management. Usually, it’s “set and forget” execution. There is very little validation and testing when initial customer journeys are created and minimal measurement of the ongoing impact. So, mastering the art and science of customer journey management will be a competitive advantage for marketers.
Adaptive content is a strategy designed to influence behavior and support personalized interactions. It attracts a reader’s attention. There are many techniques that can be used in different scenarios. Image swap features improve the customer experience by automatically changing images based on availability. Count-down timers are effective for injecting a sense of urgency. Content that adapts to a subscriber’s context, mood, or location can significantly improve relevancy and also keep your email program fresh.
Email marketing automation can be applied in several ways: data transfer, list hygiene, coupon generation, targeting behaviors, offer recommendations, and of course, to launch email marketing campaigns. Event triggered emails like cart abandonment emails, welcome emails, generate significant revenue for some companies, even though triggered email volume is usually just 5% of overall email volume. Triggered emails are very effective as they interact with the subscribers “in the moment” and improve the experience of customers with the company. While there is an upfront investment to work through the relevant creative targeting and treatment; although, once set-up properly, triggers are a very effective way to increase response and conversion rate as they require minimal resources to run.
Open rate trends
Email as a direct medium is a precision vehicle and marketers can measure exactly how many contacts it reaches. Email open rates are very critical to gauge how many subscribers read an email. The best part is that email offers a broad geographic and demographic reach. Data at the individual subscriber levels indicates that almost one-third of all email messages are opened.
More thought and time spent on writing subject lines
The email subject line is a totally controllable variable and very important to attract a subscriber’s attention. Marketers are on spending more time on email subject line and testing their email copy. And A/B split testing features makes it easier for marketers to craft a winning email subject line. Email subject lines can also be carefully pre-vetted by using simple tools. The best subject lines are usually between 35 characters to 40 characters and there is a multitude of factors to optimize.
Adoption of responsive design
Over the last few years, marketers have spent more time expanding and refreshing their portfolio of email templates. And almost all of our customers now use responsive templates, as they improve the subscriber’s experience.
Devices are usually attached to their owners and customers are conditioned to check their phones several times a day. Skimming or reading email is now an ingrained habit. And the advancements in smartphone technologies make reviewing email more convenient and seamless.
During the last few years, marketers have truly upped their game in carefully monitoring their contact strategies and also in delivering more relevant content. Better content makes subscribers more engaged and receptive.
While open rates are a good metric to benchmark and measure subscriber engagement, they just indicate that subscribers have viewed an email in their inbox, which doesn’t always tell the complete story.
Click-through and unique click-through rate trends
The click-through rate (CTR) is the best measure of engagement as it’s a true indicator of content consumption. While high CTR’s indicate your content is relevant. But, in today’s digital economy, many subscribers have short attention spans so it is hard to generate a click. To effectively deal with this, savvy marketers need to be more disciplined.
The unique CTR is the best measure of how your creative is performing. It indicates what percentages of subscribers who open an email actually click on a link within the email. The CTR is tracked quarterly to highlight seasonality trends around shopping.
A strong CRT tells that marketers are doing a really good job on creative. Improving your CTR indicates that the subscribers are responding to the CTAs within the email. And by reducing the time to CTA, you can increase the overall CTR.
List quality and hygiene trends
The bounce rates on an annual basis have been quite low for many years. Since 2010, bounce rates have come down by more than half as a result of marketers becoming more informed and disciplined with their list hygiene and also ensuring compliance with both email best practices as well as CAN-SPAM, CASL, and GDPR. Services like list cleaning and hygiene have also helped a lot.
The ISP’s are becoming increasingly more strict about the content they allow into the inbox, despite all these positive trends. Having a dirty list with spam traps, unknown subscribers, and unengaged subscribers is an easy way to get tagged as a spammer and emails from that email sender will more likely be filtered to the spam folder. As a result, it is still very important, to closely monitor the bounce rates of each campaign as well as on a monthly basis, especially for high-frequency senders.
List churn metrics trends
Unsubscribe, hard bounce, and spam complaint are very important email list quality measures that you should consistently monitor to collect insights into your data-management practices. And higher rates for these than the average rates can negatively affect your sender reputation and deliverability, which in turn, can significantly impact the success of your email marketing.
Unsubscribe, hard bounce, and spam complain all factor into what is known as list churn. List churn is the average percentage of email addresses that marketers can expect to lose in a given year, and usually ranges between 20- 50% but can be reduced drastically by practicing better list hygiene, optimizing your messaging to ensure relevancy, and adhering to industry best practices.
Inactive subscribers trends
Inactive email addresses represent subscribers on your list those who have not opened, clicked, or taken any action for a significant amount of time. While many marketers define inactive subscribers as subscribers who have not opened or clicked your emails in the last 6 months, other defines inactive subscribers as subscribers who have not opened or clicked your emails in the last 3 months. To effectively deal with this, marketers should continue to look for new ways to re-engage and reactivate this segment, like launching a re-engagement campaign.
On the other hand, your inactive subscriber can also have a negative impact on your email deliverability. Inactive email addresses can turn into spam traps and they bring down the average response rates for the entire email marketing program which can further negatively impact your overall sending reputation. So, get a process in place to identify, segment and reengage or clean inactive users off of your email lists to best manage your email marketing program.
Email deliverability trends
The first step in the sequential chain of effective email marketing is to get into a subscriber’s inbox. Achieving good email deliverability on your email campaigns can be a big hurdle if you don’t have things buttoned down. Maximizing your actual reach has a significant impact on funnel metrics like a CTR. Best-in-class deliverability requires expertise and constant diligence.
Email deliverability is a quality assurance metric that identifies where the actually delivered emails finally land. The overall email deliverability in North America has reduced over the last few years. The proportion of emails that make it directly into the inbox is called the Inbox Placement Rate (IPR).
Average North American IPRs in 2016 experienced another sharp decrease for US companies. American companies saw over 25% emails land in the spam folder or go missing, with inbox placement dropping from 87% in 2014 to 76% in 2015 and eventually around 73% in 2016.
Good email deliverability needs consistent discipline and vigilance. And marketers should continue to find ways to engage their subscribers in more meaningful ways so that a greater percentage of their emails make it to the inbox of their subscribers.
Email marketing is a very powerful and effective medium that offers the highest ROI compared to other marketing mediums, and when we talk to CMOs, they usually comment that email marketing is their top performing vehicle. On the other hand, they also realize that there is a lot more to email than what appears on the surface. And the same is also true about measurement.
The benchmark reports educate industry practitioners to ensure that agencies and ESP’s use the official standard definitions. Even nine years after S.A.M.E. was introduced, few ESP’s still use non-standard calculations that overinflate their metrics. The take away for marketers is to double-check benchmarks to ensure you are comparing apples to apples and oranges to oranges.