Chris Hexton (@chexton) is the co-founder of Vero, an event-based email marketing platform that helps startups increase conversions and customer satisfaction. He blogs periodically about these topics on the Vero blog.
Everything your users do or don’t do can be used to personalize and target your messages to them. Their actions provide the opportunity to reach out and deliver the right message at the right time. Event-based emails bridge the gap between these opportunities and better metrics.
Nearly every startup founder has used MailChimp, Campaign Monitor, iContact or similar at some point in their career. These are the go-to tools when it comes to one-to-many email marketing campaigns and they do a really great job but I’m here to talk about email marketing a little differently.
Lifecycle marketing involves sending individual users personalized, targeted emails based specifically on where they are in your startup’s lifecycle. To illustrate, a simple example is sending an email to users who haven’t logged into your software 10 days after they sign up for a 30-day free trial. Believe it or not, most startups do not do a good job of sending emails like this. At first it can seem difficult to integrate, hard to analyze and even harder to alter your campaigns but, the truth is, with a few simple steps you can get some basic emails set up and increase your conversions and user retention today.
But it’s just spam!
Fact: the average open rate for direct marketing emails is around 20 percent while the average open rates for event-based (transactional) emails is around 50 percent. This means your message is dramatically more likely to be read if delivered via an event-based email.
One common complaint against email marketing in general is ‘but it’s just spam’. This complaint assumes that readers don’t want to read anything you send them and the people who say this sort of thing are the ones who have missed the point of lifecycle marketing. The whole aim of a series of well thought-out lifecycle email campaigns is to send users the right email at the right time.
The emails you send don’t have to be fancy, colorful or ‘salesy’, but they do have to be targeted and feel personalized.
There are some great examples of startups that do a great job of lifecycle marketing. It shouldn’t surprise you to learn that these startups are also growing quickly, have a massive following and a real brand. Just scanning my own inbox, examples of quality event-based emails have come from names like Dropbox, Buffer, Amazon and HelloFax.
Taking a more detailed look, here’s an email I received from HelloFax just last week. It came 2-3 days after I signed up (and didn’t log in at HelloFax.com) and all it says is:
Hi – I saw you just signed up for hellofax.com, let me know if there is anything I can do to help.
It’s not complex, but it reminded me that I hadn’t checked out their site properly. Not only did I go and get a better feel for it but I even found myself thinking of ways I could use HelloFax days after this email was sent. You can rest assured that next time I need something signed, I’ll be thinking of HelloFax.
Some hard data
An anecdote is nice, but what about some hard data. Fortunately, I’m in a position to share some. We recently began working with a new customer, Flightfox.
Flightfox.com allows you to list a flight (e.g. SFO to London), pay an upfront ‘finders fee’ and have flight hacking experts bid to find you amazing discounts on flights. Listing a flight is a two step process, with the key events being a) filling out your flight details and b) paying the finders fee.
As you can imagine, some users fill out their flight details but do not progress to paying the finders fee. As our first order of business, we worked with Flightfox to fire an email one day after a user fills out their details but doesn’t progress to paying the finders fee. A simple, plain text email was the first version we sent out and the results were astounding.
Even without A/B testing or tweaking, this basic email resulted in a 2% conversion rate on all emails sent out. This means they actually increased their overall conversion rate by around 18 percent, thanks to a single email. As any good startup founder and A/B tester knows, a permanent increase of this magnitude is impressive.
If Flightfox were to use AdWords to gain the same number of sales generated by this email in just one day, they’d have to spend 50 times as much as it costs to run this marketing campaign.
Having set up the basics, there are now countless possibilities to improve on this email through testing. There is also lots of room for further experimentation: they could target users two months after they take their trip with a reminder of recent deals, they could target users flying out of or to a specific airport with recent flight discoveries for that destination, they could email regular users with a special offer — the list goes on!
You’d be mad not to
If you build a quality lifecycle marketing campaign, you can increase your conversion rate permanently. When you think about it, you’d be mad not spend the time and effort it takes to setup your important lifecycle emails and test and refine them to get your conversion rates as high as possible.
Over the last six months, I have read a number of quality blog posts discussing email marketing and the ways in which it can be used by savvy businesses to increase user engagement and conversions. Two that spring to mind include this post by Paul Stamatiou and this post by Patrick McKenzie and they are definitely worth some follow up reading.
You can also read my recent blog post outlining three steps to get you up and running with event-based emails.