A 10-Point Strategy to Optimize Your Email Program Part 1

David Daniels | ClickZ | June 4, 2012

Need to improve your email marketing program's performance? Here are the first five of 10 essential email marketing strategies to optimize your program.

1. Begin with the end in mind - incorporate testing and frequency caps. Ensure email marketing mailings focus on goals by incorporating regular testing into marketing campaigns. Tests should focus on variables that are levers (e.g., frequency, time of day, content) for attaining target goals (e.g., conversion). Work backward from a specific goal to ensure optimization practices such as testing are part of the mailing process. Determine the total number of messages subscribers will receive in a given month. Typically, marketers mail once per week. However, develop a contact strategy that incorporates frequency rules to avoid burning out subscribers.

2. Place value on email addresses. As discussed in this column, without understanding the value of email addresses or email subscribers to the organization, you will have difficulty making a strong case for additional investments in email marketing programs (e.g., dedicating more site real estate to email acquisition, using offline resources to collect and/or reactivate email addresses). Determining the value of an email address requires understanding email acquisition costs and metrics such as average revenue per email subscriber. A more detailed approach can mirror customer lifetime value calculations, incorporating customer-specific recency, frequency, and monetary values.

3. Develop acquisition, retention, and reactivation programs. Although most marketers immediately jump to developing ongoing retention- or newsletter-oriented mailings, my experience indicates that acquisition and reactivation programs are not well thought-out. It's a bummer, but you must anticipate that many email addresses in your file will go bad (i.e., churn), with one-half to two-thirds of lists not being responsive. Surveys and sweepstakes (if brand appropriate) work well to elicit a response from dormant subscribers. Use the value of an email address as an arbiter when determining appropriate and cost-effective reactivation tactics (e.g., call center intervention, postal mailings). Map out a subscriber preference center page to determine the manner in which new addresses and unsubscribe requests will be processed. Keep in mind that you want email to be a two-way conversation with your subscribers. You want to create a dialogue.

4. Develop key performance indicators. Although open, click-through, conversion, and delivery rates are useful, they are also necessary ingredients for developing an engagement metric to track the health of a mailing list or segment over time. Along with these metrics, add unsubscribe rate, spam complaint rate, new-subscriber rate, and hard bounces to a quotient that directionally indicates the quality and performance of the mailing list. Each metric can be evaluated, but rolling all of them up into one number to review at a glance makes it easier for marketers to gauge the health of subscribers over time.

5. Focus on behavior. Subscribers' behavior should be central to your segmentation strategy. Create engagement rules (e.g., number of subscribers clicking on at least one link during past three or four mailings vs. those clicking more frequently and those not clicking at all). This approach will create a behavioral segmentation framework to drive subsequent mailings and remarketing campaigns, providing an overall effective means of targeting. For example, Travelocity sends subscribers email based on their last action on the site, whether it was saving a trip itinerary for possible future purchase or making a purchase. Ensure that you begin to map out how you will break your subscribers into different buckets and how that will impact the application tools that you require.

Part two, which will be published June 18, 2012, will examine five additional optimization techniques.

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