Lifecycle Email Communications Boosts Subscriber Retention: Relevancy is the Key to Engaged Subscribers
By Megan Ouellet, Director of Marketing for Listrak
June 15, 2009
There's a dirty little secret about email marketing that's really not so secret. Because email is still so cheap to send, and because email marketing continues to get a small share of marketing budgets, not all marketers take the time to ensure their email messages are as targeted as they should be or that their subscribers are actively engaged. Bottom line - they're alienating their customers and risk tarnishing their reputations.
Being customer-centric, or customer-focused, is by now a well-accepted tenet of doing business. Its importance has only increased as businesses of all shapes and sizes battle to trim costs and drive out inefficiencies, while maintaining service levels, product quality and brand reputation - all in the face of an extremely tough economy.
The truth however, is that although it makes perfect sense for businesses to do everything they can to ensure their current customers remain happy and active buyers, customer retention often is overlooked. When it comes to email marketers, for some the batch and blast mentality still exists. More (subscribers and messages) is better. The opposite, of course, is true. Highly targeted, relevant email messages are the key to increased subscriber retention and loyalty, and company profitability.
Studies by leading management consultancy, Bain & Company, show that a five percent increase in customer retention can increase a company's profitability by 75 percent, reinforcing the sound business sense of paying attention to subscriber retention. Building on-going relationships with your email subscribers may be one of your biggest opportunities to contain costs.
However, while most marketers are familiar with the generally accepted mantra that it costs 5-7 times more to bring in a new customer than to sell to an existing customer, some are still not taking the time to fully understand their subscribers and to communicate with them, rather than at them.
Attempting to calculate and compare the exact cost to market to a lead via email versus the cost to acquire an online lead is extremely difficult. Is the lead a "generic" sales lead or a "brand specific" marketing lead? How qualified is the lead? Did they simply sign up to get a free offer, or were they a referral lead from a partner company perhaps with little or no real interest in your company or products? Clearly retaining a customer that has opted- in to receive your email or that has a history of opening your email messages, or may already have a purchase record, costs far less than acquiring a new one.
Businesses that are doing all they can to protect and grow stronger customer relationships are building a competitive advantage in these challenging times.
Listrak, an innovator in the email marketing industry and the email service partner to companies like The Islands of the Bahamas, Hitachi, and Motorola, has put together the following white paper discussing how to build effective email campaigns that strengthen subscriber relationships over the entire lifecycle.
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