DMA Email Marketing Council Blog

Metrics and their meaning - Part 2

Here's the second installment of the Legal & Best Practice Hub on Metrics and their meaning. What we're hoping is to gain your feedback and comments.

This week we're looking at Internal Monitoring and the metrics that feature in this area:

1. Average Soft Bounce Rate        

Definition: The number of soft bounces divided by the number of e-mails delivered (as a %).         

Things to take into consideration: A soft bounce indicates a temporary reason (inbox full, server temporarily unavailable etc.) why the e-mail can not go into the inbox. In this instance, it is worth trying the e-mail address at a later date. However, monitor repeat soft bounces and remove after a maximum of three.

2. Average Total Click-through Rate        

Definition: Number of total clicks divided by number of e-mails delivered (as a %).

Things to take into consideration: If comparing results with other campaigns, make sure the click-through rate is measured using the same metrics. It can be click against e-mails sent, e-mails delivered or e-mails opened. Always compare like for like, and know which option has been used.

This metric attempts to answer the question, “How many times did a person click on a link or multiple links within this e-mail?” This may or may not include clicks on unsubscribe links or other links, and you may find it helpful to view click-through reporting by individual link. This metric is a whole number in the form “100,000″ or as an e-mail Click-through Rate percentage in the form “10%”. The denominator is e-mail delivered, and this percentage may exceed 100%. [Source: Internet Advertising Bureau]"

3. Average Unique Click-through Rate        

Definition: Number of individuals who have clicked through divided by number of e-mails delivered (as a %).        

Things to take into consideration: This is a measure of the emails overall effectiveness because it looks at emails that generated a click.  If the campaign is an acquisition campaign then this is a more valuable measure than total click rate.

4. Average Unique Open Rate        

Definition: Unique opens divided by number of e-mails delivered (as a %).        

Things to take into consideration: Due to the high number of false negatives (emails that did not show as opened because the images were switched off) and false positive(emails that were opened in the preview pane but were not viewed by the recipient) this is not an accurate measure of how many emails were opened.  It is however an excellent directional indicator of the effectiveness of your subject line among other things.  Make sure reporting is consistent. For example, if comparing different sources, ensure it is not confused with opens from sent or total opens (which will include when the same person opens an e-mail more than once).

5. Click to Conversion Rate        

Definition: Number of clicks divided by the number of conversions or intended actions e.g. clicks converting to sign-ups for a newsletter or a successful download on an offer.        

Things to take into consideration: This is the key metric when measuring success. It is important that you are clear from the start that the objective is defined. Also remember not to use this metric in isolation. The uplift in actions that come directly to the site, via telephone or visit to a shop show room need also to be recognised as a benefit of the email campaign.

6. Click to Open Rate        

Definition: Number of clicks divided by the number of opens.  It is generally calculated as either Unique Click-through over Unique e-mail Opens, or Total e-mail Click-through over Total e-mail Opens. [Source: Internet Advertising Bureau]         

Things to take into consideration: This metric attempts to answer the question, "Of the Unique e-mail Opens, how many individuals took an action?"

7. Click to Purchase        

Definition: Data Users can correlate directly the clicks from the e-mail resulting in transactional behaviour. From this a clear calculation of the Return on Investment (ROI) from a programme or campaign can be made. It is considered to be best practice to always pre-define measurement and success criteria and to track conversions accordingly. This can either be achieved directly using tracking technologies embedded with the e-mail, or via a data match back process post campaign. [Source: DMA Best Practice Guidelines]  

Things to take into consideration: From this a clear calculation of the Return on Investment (ROI) from a programme or campaign can be made. It is considered to be best practice to always pre-define measurement and success criteria and to track conversions accordingly. This can either be achieved directly using tracking technologies embedded with the e-mail, or via a data match back process post campaign.

This is a valuable measure but it is important not to only attribute this value to the email. Email is not 100% trackable. Remember consumers do not always react in the way we want them to. Some will pick up the phone, come to the site direct or interact with your brand in a different way to through the email.  Remember to add additional value when looking at the true benefits. "

8. Click-through Metrics        

Definition:

• Total Click Rate (Total Clicks/Total Delivered)

• Unique Click Rate (Unique Clicks/Total Delivered)

• Click to Open Rate (Unique Clicks/ Total Opened)"        

Things to take into consideration: It is important to define what metric you are using and be consistent. These measures do have a value particularly in terms of relevance to the audience targeted, but must be used in context. It is important not to use these measures in isolation to judge success, the results in relation to end results are what should do this.

9. Click-through Tracking        

Definition: When a hotlink is included in an e-mail, a click-through occurs when a recipient clicks on the link. Click-through tracking refers to the data collected about each link clicked, such as how many people clicked it, how many clicks resulted in desired actions such as sales, forwards or subscriptions. [Source: Marketing Sherpa]         

So that's part 2. We look forward to hearing your thoughts.

Jonathan Burston

CACI & Legal and Best Practice Hub

Inactive or Unemotionally Subscribed?

The term "emotionally unsubscribed" as a way of describing the subscribers who do not interact with your emails for long periods of time seems to be making a comeback - unfortunately.

I first came across the term 2 – 3 years ago and I have never liked it, particularly when it comes to describing people who have given you permission to email them.

I dislike the term because:

1. I really find it hard to believe anyone is so disengaged with your program that they can’t be bothered to unsubscribe - it only takes a click!

2. It is a very negative way of looking at the issue of inactives and implies that it is a result of some kind of failing on the part of the person sending the email; a classic case of what I call fear and self loathing in email marketing.

With very few exceptions when it comes to sales and marketing, long term inactivity is perfectly normal. After all, how often do you actively interact with marketing communications of any kind from a car dealer, insurance company, estate agent, bank, consumer electronics retailer, hotel chain etc? 

 So why should email marketing be any different?

I prefer to call them Unemotionally Subscribed

Given that between 35% and 55% of your list will NOT have interacted with your emails for between 6 months and a year,  I think that a better description is that they unemotionally subscribed – that is they do want to receive your emails, but don’t need your content or offer yet.  They would prefer to ignore your messages until they are ready to buy, because it is easier than unsubscribing and having to remember your url or Google you at a later date.

We have gathered plenty of evidence of this phenomenon, from our deep dives into client data and here are some examples:

- £70,000 generated by subscribers who had not opened (downloaded images) or clicked on the previous 25 to 40 emails - it was a great offer.

- 10% of 2008 revenue generated by subscribers who did not open or click at all in 2007

- The most common or modal open, click or purchase frequency across every email audit we have ever conducted is 1.

The takeaway is simple.  While some of those inactive addresses may be people who fit the emotionally unsubscribed description, the vast majority are unemotionally subscribed - they don’t need you - yet!

So don’t beat yourself up over the fact that they don’t feel compelled to read every email you send.

Is Email really the new Direct Mail?

If the recent Borrell Associates report is to be believed, then "Direct mail has begun spiralling into what we believe is a precipitous decline from which it will never fully recover." OK, we’re all familiar with email’s benefits over direct mail…cheaper, quicker, easier to measure, greener, etc. However, before we write off direct mail completely, research that we have carried out indicates that the way forward is really to use email in conjunction with direct mail and to give the consumer the choice as to how they want to hear from us.

Direct Mail is certainly not dead. It may sound trite, but consumers still like receiving Direct Mail and if the piece they receive is relevant, it is not deemed to be "junk mail". What we may also be forgetting, is that the current UK internet at home penetration still sits at below 70%, so in order to reach as much of our target market as possible, an integrated, multi-channel approach is a must. Marketers selling consumer products need to be speaking to their buyers/prospects in the home environment by both online and offline channels.

Campaign analysis that we have recently carried out has proved that online communications can drive offline actions and that the reverse is also true. Email communications drive newspaper sales, even if the email isn’t asking the consumer to go and buy a paper. By the same token, direct mail and email communications to the same individuals drive uplift yet higher.

So, yes, direct mail volumes are falling, but better targeting and a more complete understanding of channel effectiveness and consumer preference is what we should concentrate on.

Rupert Harrison

Data Planner

News International

Surge in Digital Sponsorship

Sponsorship, once a symbol of corporate excess, is now finding its place within the business world—especially in the digital sector, where sponsors know how to best maximise ROI from these channels.  By its nature sponsorship creates ideal digital marketing opportunities.  It has the flexibility to provide platforms for brands to create exclusive content and online experiences as well as being able to engage directly with their audience.

With more than 50% of DMA sponsorship coming from digital marketing partners, you might be wondering what you are missing.

Marketers are desperately searching for new and economical avenues to create stronger relationships between their brands and target audiences. One avenue that’s resurgent is sponsorship, which is proving a powerful way to engage with consumers. At a time when people are constantly marketed to through an increasing number of channels, consumer engagement is vital for marketers to get their messages across.  When reaching its target audience, sponsorship provides an ideal medium to facilitate this engagement by providing tangible “touch points” for the consumer.

For example, when Silverpop, a U.S.-based organisation that provides worldwide Web-based solutions to its clients, was interested in building brand awareness among the top marketers in the United Kingdom, it chose to incorporate a bespoke DMA sponsorship programme within its marketing mix to do so. Silverpop has recently signed on to exclusively sponsor the DMA B2B Email Marketing Event, which will be taking place on 1 October 2009 in London. This partnership has allowed the DMA to provide new training for the B2B email sector while also providing Silverpop with the best platform from which to showcase its expertise.

For Silverpop, the many touch points and benefits of this partnership include:
•    A speaking opportunity at the event
•    Production of a joint press release
•    Increased profile among delegates throughout the promotional campaign

This sponsorship has provided the perfect platform from which to increase brand awareness and engagement among the people that matter most to the company. 

If you haven’t yet thought about integrating sponsorship into your marketing mix, or felt it wasn’t useful to your type of business, you might want to take a fresh look at your current marketing and what your competitors are doing—it may surprise you.

Jackie Fast
Direct Marketing Association

Call for tenders for DMA EMC Blog Redesign

Our blog is almost one year old! And to celebrate we're looking to give it a new look and increased usability. So we're calling for DMA members who would like to tender to redesign the blog and assist us in making the most of this wonderful medium.

For a detailed brief to be sent to you please email me. (Agencies willing to work with the DMA on an exchange of services basis will be looked upon favourably.) Final submissions to be received by April 3rd.

DMA Email Marketing Council Elections - Congratulations

Congratulations to the following people who were successful in the DMA Email Marketing Council Elections - we look forward to receiving your posts on this blog!

• James Bunting, Head of Client Services, Communicator Corporation
• Denise Cox, Email Newsletter Specialist, Newsweaver
• Guy Hanson, Business Development Director, Database Group
• Rupert Harrison, NGN Data Planner, News International
• Kirsty Montgomery, Senior Int Email & Affiliate Marketing Manager, Hilton International Hotels
• Matthew Simons, Leader – Acxiom Digital Europe, Acxiom Digital 

Time to turn your attention to e-mail ‘acquitention’

With the recession putting marketing budgets under ever more pressure, brands will inevitably be forced to be more creative with their e-mail campaigns and distribution. Here are six tips for gathering new customers without dropping your existing service levels.

1.    Look after your loyal customers

Changes in consumer behaviour will likely mean you need to revisit your current customer segmentation strategy. Let’s say customers in your top segment typically spend £500 a year; now assume that the economy forces these customers to cut back and spend only £400 a year.  Those £400 spenders are still loyal customers – tightening their belts, but still worthy of VIP status. Adjusting your parameters will be critical in order to avoid alienating your core customer base.

2.    Automate revenue-generating programmes

Implement automated trigger-based email campaigns, these are campaigns that send out messages based on actions taken by a recipient. Triggered e-mail messages offer a two-fold advantage. First, because they are automated they enable cost-effective programme management. Second, they ensure contact with customers at the most timely points in the relationship and buying cycle, thus delivering consistently high ROI results. In fact, it is not unusual for a triggered message to deliver upwards of five times higher revenue when compared to a standard broadcast e-mail.

3. Think of new ways to expand your email lists

Those loyal customers I mentioned earlier are also your brand advocates, and perhaps the best option for acquiring new customers. With new names getting harder to acquire, we recommend a strategy of ‘acquitention’. Although not a word that rolls off the tongue, the rationale behind it is solid. By devising a strategy aimed at acquiring the email addresses of long term, loyal customers who purchase through other channels, for example point-of-sale, in-store and loyalty card customers, not only are you likely to boost online sales, you will find that offline purchases by these customers are likely to increase also. There is plenty of research to support the view that the more channels a customer uses to purchase your product, the higher the lifetime value of that customer.  By focusing on acquitention, you could significantly increase your email lists as well as build loyalty and online sales.

4.    Fine tune your e-mail frequency

There will be plenty of temptation (not to mention management pressure) to ramp up the frequency of your email. Increasing frequency is fine, as long as you are intelligent about it. Do so by adding relevant programmes that target a particularly active segment of customers, or an opt-in programme that sets the expectation with customers that these messages will arrive more frequently. Simply blitzing the inbox may increase revenue in the short-term, but it could devastate your customer list with unsubscribes – including the loyal customers you have invested so much time and money in acquiring.

5.    Test your programmes for good measure

Times are tough, and you may be tempted to discard with your testing programmes in order to save budget. The truth is that it is more important than ever to understand which campaigns are performing the best, and why. Save money instead by focusing your budget on improving the highest performing programmes. Testing against a control will help you identify which programmes are yielding the greatest return on investment, and how you can enhance them.

6.    Be prepared to defend your budget

E-mail has all the essential qualities a CFO looks for in a tough economy: it’s measurable, predictable, and profitable. In fact, it’s not unreasonable to think that your CFO will want to put more budget into e-mail, even as cuts are being made in other areas. But don’t be complacent. Be prepared to defend your budget.

No budget item is off limits, including your e-mail marketing budget. Be prepared to show your executive management how each e-mail sent converts to sales and provide them with an accurate measurement of your programme’s return on investment. The beauty of email is that all of this data is at your fingertips.

By Simone Barratt
MD e-Dialog

Avoiding that P-45

There is an interesting disconnect developing in digital marketing.  On the one hand is the notion that if your marketing is effective then holding the marketing department to a budget is not the best way to run a business.  On the other there has been a lot written over the past couple of weeks about how most marketers cannot or do not measure ROI, so how are we to know if the marketing is effective.

Peter Simmonds wrote on the dotMailer blog that if your marketing makes more money than it costs (e.g. has a positive ROI) then "a marketing budget is just a way to restrict how much money you can make."  Jack Woolfe takes this a step further in his Hunter's Tale column in the January issue of Precision Marketing; arguing that marketing budgets should be expanding because:

1. Prices are dropping so the same marketing spend goes much, much further.
2. Marketing will be a key tool to rebuild consumer confidence which will pull us out of this economic malaise
3. If all of your competitors are cutting their marketing then there is a land grab opportunity for you.  The worst case is that you force your competitors to match your marketing spend forcing them to cut elsewhere.

The same issue of Precision also quotes a Coremetrics study that found that 74% of retailers are not measuring the ROI from multiple channels, which is not surprising because this is quite difficult.  What was surprising was that only 66% measure the ROI of paid search and 80% measure it on organic search.  Even more concerning is that in last year's DMA National Client Survey, only 59% of respondants can measure the revenue generated by their email programs.

What does this mean for the average email marketer?  The sooner you develop a way to measure the return on your email programs - the sooner you will be able to justify the marketing budget that pays for your program (and your salary) and the sooner you will not have to worry about a P-45.

Skip Fidura
dotMailer

Days of the week and colours: more questions than answers on differences between retail here and in the US.

'Cyber Monday' is defined as the first workday after the Thanksgiving holiday in the United States, and as logic would suggest follows 'Black Friday' which relates in this context to ecommerce and retail sales, specifically the upward trend that follows from these dates in late November through the Christmas period. The terms ‘Black Monday’ and ‘Black Wednesday’ are perhaps better known in the UK but not in the context of retail. 

The report cites examples and highlights strategies used by different retailers, compares 2008 to 2007 and gives great food for thought. If you or your customers operate within the retail sector I would rate it as a recommended read purely for background knowledge, how retailers are using email in the US and perhaps above all the potential for idea generation.

For me the report made for interesting reading and rather than summarise its findings I thought I’d post some thoughts and questions that I had after reading it:

- The term ‘Cyber Monday’ originally coined by US marketers in 2005 (according to BusinessWeek) and has quickly grown. As the report states there is “greater acceptance” of the term including many brands using the term in subject lines and message content. This is interesting. Is it because here in the UK we don’t have a public holiday before Christmas there is less of a clearly defined start point (although broadly speaking the end of November signals an increase in retail spending)? There is no ‘Cyber Saturday’ as such here. If there was a similar term in the UK would brands use it in the same way as US retailers have been doing, mentioning it in subject lines, message body. 

- I wonder how UK and US email volumes, strategies, subject lines, offers compare? Further, to what extent do US parented retailers adapt their home grown methodologies to the UK? What UK based research is available that could be comparable to this report?

- What if any emails that you received from UK retailers drove you to make a purchase late last year? For me it was this retailer. Who, interestingly had a better than most Christmas retail season in terms of sales.

- How would the email strategies of the top UK retailers correlate with their financial results? Who in the UK retail sector is using email in an engaging fashion? How can email be best used to drive sales in retail against a backdrop of slowing retail sales, how are retailers adjusting their email marketing strategies in the economic climate?

The 2008 ‘Cyber Monday’ report written by Chad White can be downloaded by DMA members free of charge here, login required.

Richard Gibson

RSA Direct

"Email Equity" or "Spray & Pray"

£9.11, £20, or at the risk of sounding like Bruce Forsyth - Higher / Lower? 

At the start of January 2009, an article that was published in Revolution magazine put the value of a permission based email at £20. This proposed a new updated value from the £9.11 put forward by the Direct Marketing Association (DMA) National Benchmarking report in this post in 2007.

Two things struck me by this:

1. Whilst both these figures can be criticised as being only "finger in the air" - how many companies can, even if they choose not to say, actually place a value of their own asset (excuse me if I don't put email list, database etc but lets call it what it is)

2. Given that they can value this asset do they treat it as such i.e. regularly measure it, manage it, and through a structured process aim to improve it !

Over 2008 I monitored the number of emails I received from 24 companies (I registered but then did not open). Have a look at the monthly figures but the difference was stark.

• One company emailed me 105 times in the year!! This suggests that they are either very persistent, very optimistic or not listening to the feedback they should be getting ?

• Others emailed hardly at all - I opted in and they failed to deliver !

"The time has come when advertising has in some hands reached the status of a science" - Claude Hopkins wrote in 1923, but my experience over 2008 suggests not all hands !

If companies do not go beyond a "never mind the quality feel the width approach" i.e. How big as opposed to how valuable, they will be unable to have communication that is relevant both to their customers and their corporate goals.

In discussion with various delegates at a recent Ready Steady Email event, feedback suggested that people are starting on the route to email equity but it still has some distance to travel. However the sooner companies start the sooner they should get there!

I'd appreciate your thoughts.

Stefan Elliot
Six Serving Men