These insights are drawn from the Q2 2015 email benchmark report. Click here to download the full report.
As an email marketer, you’re probably targeting customer segments, using name personalisation in subject lines and building dynamic content blocks. Or at least you’re aware of the techniques. How about real-time individual customer experience management and pre-qualified product selection?
What I mean to indicate by this is the practice of marketing personalisation is subject to continuous innovation, both creative and technical. The net result is a wide spectrum of practice, from the simple and familiar, through to the altogether more complex and, in some cases, daunting.
That’s why we’ve created a personalisation gradient to enable marketers to assess their own level of personalisation sophistication in their pursuit of intelligent interactions. The gradient is by no means the last word on personalisation; innovation will see to that. But where do you sit on the scale today?
Stage 1: Static
You’ll notice the first stage in our personalisation gradient involves no personalisation at all. Even the most sophisticated marketer may deal with static campaigns and an absence of personalisation need not necessarily mean a lack of consideration.
Modern marketing can be conducted through campaign-level analysis, collating insights that are subsequently fed back into the campaign optimisation loop. Monitoring campaign performance in response to variable changes (for example, a change in the day of week on which a campaign is sent) shows an appreciation for customer preference. But in treating an audience as a whole, it’s not personalisation.
Stage 2: Identity
The second stage – or ‘first stage proper’ – in our gradient reflects customer identity. This makes sense: in seeking to treat customers as individuals – as opposed to homogenous groups with identical needs – the most basic step a marketer can take is to address them as such.
The good news is that this stage can include a lot of ‘quick wins’ for marketers currently limited to static campaigns. What is more, these seemingly trivial details really do make a difference: in Q2 2015, emails sent with personalised subject lines – including either first name, surname, or another unique identifier such as account number – were 7% more likely to be opened than emails sent with blanket subject lines.
Other identity variables can include gender, location and even age – all of which can help marketers to communicate using relevant language and in making basic content selection decisions.
Stage 3: Insight driven
Using insight to design customer segments based on characteristics such as engagement status, propensity to purchase or membership tier allows marketers to take their personalisation strategy to the next level.
Though often fairly broad, segments allow marketers to move away from generic messages and to communicate with specific groups in meaningfully different ways. The end result typically revolves around the use of dynamic content or even creative, making messages substantially more relevant to commonly held interests or needs within a specific group.
Relevant communication is not an end in itself though. The objective is to use relevant communication to increase efficiency, engagement and, in many cases, revenue.
Re-engagement programmes are a good example of using segmentation to achieve the three aforementioned increases in efficiency, engagement and revenue. Here’s how in three simple steps:
- Classify your disengaged audience
Using customer-level data, identify and isolate disengaged customers. If a particular individual has not responded to a marketing communication over a specified period, it makes sense to remove their email address from usual communications. This can help to increase efficiency with significant cost savings based on reduced volume
- Understand your disengaged audience
Conducting regression analysis can help to identify the factors driving disengagement. Were expectations met? Were communications too frequent? Was content relevant? Are email addresses still active? Knowing the reasons behind disengagement can substantially increase the chances of re-engaging with customers at a future date.
- Design a compelling re-engagement programme
You’ve isolated your disengaged audience and made an effort to understand why they’ve stopped engaging. The next step is to design a compelling re-engagement programme. This in itself is a form of personalisation – serving specific content to a specific segment. But some of the best re-engagement programmes take personalisation a step further. Using personal information such as past purchases and browse history can help to enrich messages with a stronger incentive to return. Re-engagement programmes can also provide an opportunity to collect more personal information by means of preference surveys.
The fruits of these endeavours can be significant: An Experian study conducted in 2013 found that targeted re-engagement campaigns can lead to increases in sales of up to 10%.
Stage 4: Enriched Insight
Stage four – enriched insight – is a short step from insight-driven personalisation, and many marketers will find the work that they conduct on a day-to-day basis falls between these two stages.
An enriched insight approach is broadly the same as the previous stage in so much as communications are refined based on segment preferences, gleaned from analysis and insight. The crucial difference is that an enriched insight approach adds further granularity by increasing the number of variables by which a group or segment can be defined.
This highlights one of the limitations of an insight-driven approach: access to data. The majority of marketers will have a limited number of fields per record available to them and will therefore be forced to base their segment preferences on fewer variables than they might like.
Enriching insight with second or third-party data helps to work around this limitation by appending additional fields to a record. This allows marketers to develop more accurate views of their segment as well as their preferences, needs and interests.
Third-party consumer classifications such as Mosaic can append all sorts of additional variables to an existing database linked to demographics, socio-economic and consumption characteristics, and property, location and financial measures. Second-party data sources can also enrich existing data sets via data sharing as part of mutually beneficial relationships with strategic partners.
Stage 5: Single Customer View
An effective Single Customer View (SCV) provides real-time, individual customer experience management across channels. Where insight-driven and enriched-insight personalisation base communications on segment or group preferences, a single customer view is more granular, striving for communication tailored to individual identity, behaviour and circumstance.
For real-time email, this involves using information about a specific customer and data held in that customer’s device to present highly targeted, contextual content. There is an important distinction to be made here between real-time email and dynamic content: the latter is created using fixed data that cannot be updated once a campaign is deployed, whereas the former is crucially more fluid, taking into account circumstances local to the opener such as geo-location, local weather, and device language settings.
An example of real-time email is the use of live maps. Using a recipient’s device to take into account their current location, a live map can be generated and placed within that customer’s email. This can be particularly effective when paired with a compelling offer: for example, encouraging a customer to come into your local store (signposted on the map) to redeem an offer.
Stage 6: Predictive Optimised
Innovation will continue to push the boundaries of what is possible in terms of personalisation. In today’s climate, however, predictive optimised marketing is certainly at the more advanced end of the gradient.
We have seen how a Single Customer View is designed to facilitate real-time, individual customer experiences based on identity, behaviour and circumstance. Predictive optimised marketing takes this approach a step further by using personal data to anticipate the customer’s future needs.
Predictive scenarios – or ‘next best actions’ – can be calculated using variables such as past purchases and browse, click and cart activity, with the end goal of enhancing communications with highly targeted offers.
Example: Pre-qualified product selection
Offering products that are pre-qualified to a specific individual can help to increase both engagement and conversion by removing some of the legwork involved on the customer’s part.
This type of predictive model is particularly relevant in relation to more complex transactions – typically financial products such as loans and mortgages or big-ticket items that may require finance – where transactions are subject to approval. Though the prospective customer is likely to conduct subsequent research to compare their pre-qualified offer with alternatives on the market, presenting an offer that is pre-approved and ready to purchase can increase unique clicks by as much as 9-fold as compared with emails containing a generic offer.
As our gradient demonstrates, email personalisation is a sliding scale – and as has been suggested, ways and means of personalising communications will continue to evolve.
Of course there are boundaries that should be respected. It is important that marketers continually assess the balance between smart communication and customer privacy. But there is an exciting future ahead with myriad opportunities for marketers looking to build better relationships and interactions with their customers.
If you are interested in learning more about email personalisation, or require assistance get in touch with Experian Marketing Services.
Experian Marketing Services is the leading global provider of customer insights, data quality and cross-channel marketing. We help organisations intelligently interact with today’s empowered and hyper-connected consumers.
By helping marketers identify best customers, find more, and then coordinate seamless and intelligent interactions across the most appropriate channels, Experian Marketing Services can deepen customer loyalty, strengthen brand advocacy and maximise profits.