Email
is a bit of a special medium. Most people have got an email address that is
unique to them, which makes it more in common with a mobile phone number than a
postal address.

An
email address is individual (most of the time) and it can be linked closely to
the customer lifecycle using response data alongside RFM data.

This lifecycle
can be tracked, measured, anticipated and managed. Here are some ideas on how
you can use the stages of the lifecycle to develop strategies that prolong the
relationship with your customer and increase LTV.

What are the stages?

As
you may have noticed, this knowledge of the customer is going to require
customer data, allied to the email address. This might be a tough one, but the
bottom line is you need this information to know what to send to the customer
and when to send it.

Generating sustainable revenue from an email list is going
to require information about the customer, and in this piece, we will consider
the objective for each of the stages of the lifecycle.

1. Prospect

This
is a tough one for email, as the channel was often abused by mass mailing of
cold lists in an effort to generate revenue. Although this did work for a while, changes in the email environment led
to severe deliverability problems for some mailers and the decline in the use
of cold email lists in the B2C markets.

Irrespective of the methods used to drive
traffic to the site, the first key element is data capture.

Objectives for data capture

Obtain a clear and valid email address

Many
mistakes are made in the data capture process and no matter how many field
rules are put in place, a spelling mistake will create an invalid email
address. One of the best ways to reduce the mistakes is to require that the
email address is entered twice
.

Obtain permission

There
are a number of rules that surround gaining permission, which depend on the
situation. You will need to ensure that your permission process is legal as
well as making sure you make the most of the data capture process. The
conversion rate between email address capture and permission is an important
one. It’s no good having lots of emails on your base without the permission to
market to them.

Get the email address early in any process

Gaining
email permission early is very important. Without someone’s email address and
their permission, you can’t market to them. Gaining the email permission early
will allow you to follow up with an email if the customer fails to complete the
process. 

This effectively gives you more
chances to build a relationship and make sales. Without permission, you can’t
do that. 

Obtain as much relevant and useful data as
possible

This
can be a fine balancing act in a transactional process, where simplicity of
process can have a measurable impact on the conversion rate. One way to achieve
better data capture is on the confirmation page of the sale when the
transaction has been completed.  A few
simple questions, allowing actionable segmentation in the future, will add
immediate value to the data.

Break up the data capture stages

The
first stage of any sign up or transactional process will generally be First
Name, Surname, Email address, permission statement. (This could be dependent on
the data capture process. Further details available from the DMA and ICO).

Once
they submit this information, you have the means to communicate in the future
even if they don’t go on to complete the registration or sales process any
further. This allows the use of basket abandonment emails, which are important
to ensure your basket conversion is optimised.

2. Welcome

Registration

Once
the data has been captured and the recipient is now on the database, the next
thing to do is to welcome them on board! It might seem obvious, but it is
surprising how many programmes just add you to the email pot. One point to
consider is that they are obviously interested in your product or service.

Therefore, if they have registered and not purchased, the objective for this
segment should be conversion.

Offers
based on pages visited or products viewed can be powerful at this point.
Remember, as they are in the market at the moment you must use every
opportunity to convert them. This is a key segment of people, time and effort
spent crafting a welcome programme focusing on getting the first sale will
quickly pay dividends.

First sale

They’ve
made the leap of faith that has led to them to becoming a fully fledged first
time customer. Now it’s time to treat them as such, thank them for the sale,
welcome them as a customer, and tell them you’ll be in touch to let them know
of other great things they might want.

It’s also a great time for those savvy
marketers armed with information on next nearest products for cross sell.   

It
is surprising that often, the welcome email sent after a purchase is made, can
in itself generate immediate extra revenue.  

3. Single buyer

These
people already have a relationship with you. Email communication should always
acknowledge this previous purchase and encourage the second purchase. Although
this seems to make sense, how many email programmes use this information?

This
is one of the most difficult stages to properly manage. At this stage you don’t
yet know how good a customer they might be or how often they will be
repurchasing.

You
don’t want to send them an email every week, if they only make one purchase a
year. It might seem like you are doing a branding exercise, but using email to
do this is like using a Hot branding Iron (and likely to be just as popular)!

This
is where you need to start looking at the response data (opens, clicks and site
visits) to give you a clue as to how active they are likely to be. Look at how
recently they have opened and clicked an email. If they have stopped engaging
with your communications, frequency could be the problem.

Reduce the frequency
of email communications for those who are not showing any intent to purchase
.
Your customers are going to be happier seeing you in the inbox, if your
frequency of sending them email, more closely matches their level of
interest.   

4. Multi
Buyer

These
are the multi purchasers, buying from you several times, and recently! They can
be the most recent and frequent buyers of your product, and they will expect
you to know and acknowledge that fact.

Simply giving them a status that
reflects this is a good starting point. Your loyal customers could be known as
your VIP club or something similar to reflect their status.

Loyal

These
customers love you. They like you products and services, they even like your
emails! Using Engagement RFM models demonstrates there is a strong correlation between
online engagement (visits, opens, clicks) and the revenue this group of people
generate.

If you are going to invest any money in clever segmentation and
tailored content, this is the group that will show you the highest return.  It’s far easier to keep a customer than
trying to drag them back once they have gone to the competition.

5. Dormant  

These
guys have gone in some way. Maybe they don’t open emails anymore, or they don’t
visit your website anymore, or maybe they don’t buy your product anymore.

It
doesn’t look good; but it is important to look at all the data before retiring
the email address to the dead pot.

Ignoring emails, but still a live customer

Watch
this one, they could simply be suffering from too much marketing attention, and
have relegated the emails to the junk folder or a special folder that they will
ignore anyway. Don’t say goodbye to a customer who is still buying from you.

They may have started to use another email address, so allowing them to lie
fallow for a month or two, then sending them an email with quality content or a
strong offer might reactivate them.

For
some businesses, it is financially viable to use another media such as Direct
Mail or a call centre to contact high value customers to update the email
address and reaffirm email permission. 

Open and click
emails, but are dormant customers

There
are lots of reasons why someone might have stopped buying from you for now, but
it should certainly not stop you from sending them emails, especially if they
are activity opening and clicking them!

Look
on each bit of email activity from a customer, as a positive vote, even if they
are currently not buying from you. If they are still engaged with your
communications, they are more likely to become a live customer again if they
are ever in the market.

They have ignored
emails for a long time,
they are a lapsed customer

They’ve
gone. You need to accept it and take it on the chin. Despite all the best
intentions of your marketing efforts, they are just not interested in you
anymore. It’s easy to spend time and effort for little or no return just to
keep them on the data base.

Email
database size is a meaningless KPI. The key KPI is the size of your database
engaged with you via email, quality not quantity. So, let them go, don’t become
the email equivalent of a stalker!