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Advanced Email Marketing for Your Ecommerce Website

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Successful business owners are aware of how cost-effective email marketing is for customer retention and acquisition. Forbes Media concluded in 2009 that email marketing and SEO are the most affordable marketing tools—SEO topped the survey with 48 percent of the vote, while email marketing was a close second with 46 percent.

In this third instalment of the marketing optimization series we’re introducing an advanced email marketing technique that’s designed to persuade a higher number of customers to re-order. This technique uses email segmentation to target subscribers based on specific criteria and tailored messaging to deliver strong incentives to the right people at the right time, and works equally well with both B2B and B2C ecommerce websites.

In order to benefit from email marketing segmentation, you must have:

  • the ability to segment your email list based on purchase behaviour
  • the ability to send targeted messages to each segment in discussion
  • the ability to measure post-campaign changes in customer behaviour

Email Marketing Segmentation

The first step is to define the list segments. Before you can convince customers to re-order, you need to first look into their purchase history. We define our segments based on the following criteria:

  • (FTP) First Time Purchase – new customers that purchased recently
  • (OTP) One Time Purchase – customers that purchased once in a longer period of time. Determine a suitable period of time taking in consideration purchase frequency of other customers with similar interests
  • (MTP) Multiple Time Purchases – customers that purchase regularly.
  • (OTG) Off-The-Grid – former customers for which you have clear data points showing voluntary defection. These can be identified based on such criteria as unsatisfied customers, unsubscribing from your email communications, and closing their accounts

We prefer segmenting lists based on previous customer behaviour rather than demographics. In other words, focusing on what they do rather than who they are.

The Accelerated Re-Purchase Strategy

  FTP
First Time Purchase
OTP
One Time Purchase
MTP
Multiple Time Purchase
OTG
Off-The-Grid
(Special segment)
Objective Build Awareness Stimulate Up-sell/Cross-sell Re-acquire
Communication Tactic Educational, Product, Entertainment Product, Strong Incentive Product, Reward Feedback, Strong Incentive

For First Time Purchasers, craft your emails to build awareness around product categories, educational content, and the overall added value that your ecommerce website provides (e.g. access to video product reviews). Awareness of related products and services will likely inspire first timers to re-purchase. A feedback mechanism is also recommended in the email message, such as “Tell us how we can improve,” to gain further insight into their interests and needs.

For One Time Purchasers, email targeted product offers with strong purchase incentives, such as lowest price guaranteed, free shipping, or a free product. With this segment your goal is to stimulate the customer to re-purchase as soon as possible. A feedback mechanism is highly recommended for this segment as well.

For Multiple Time Purchasers, use cross-sell/up-sell tactics in your email messages to entice customers to re-purchase based on product recommendations (cross-sell) and higher quality products (up-sell) while rewarding them with valuable discounts and coupons to say, "Thank you for your continued business." For MTPs you’ll want to increase the level of targeting and personalization as the level of loyalty rises. From the email analysis standpoint, regular customers produce more history, which means you can extract more data.

Accelerate re-purchase for ecommerce websites
Increase personalization levels as the level of loyalty rises

For Off-The-Grid customers, send targeted and personalized communications via other marketing methods—such as Direct Mail (DM)—to persuade previous customers to return. As any good marketing guru will tell you, the cost of retaining an existing customer is far less than acquiring a new one. Use these DM pieces to request feedback for improvement, announce exciting changes to your ecommerce website, and offer irresistible incentives.

Measure Email Marketing Segmentation Performance

Complete your email marketing segmentation campaign by measuring changes in customer behaviours.

  • Did first-timers take any action, did they read the article, did their engagement level increase, and did they purchase a second time?
  • Did one-timers respond well to your strong incentives, and did they re-evaluate previously missed opportunities?
  • Did regular customers increase the value of their purchases, the frequency of orders, and are they becoming your natural brand advocates?
  • Did your ex-customers return, or provide feedback?

For more than a decade, Single Entry Point consultants have developed many of North America’s largest ecommerce websites, providing information architecture, data back-ends, and personalized systems. Contact us for a free consultation and discover why we’re leading the industry in advanced email marketing.

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Mike LascutMike Lascut is Principal of Single Entry Point® Marketing, focusing on the search, email and analytics practice and leading the development of the Single Entry Point Email Marketing next generation product. Mike's professional career spans over twenty years, including twelve years of intelligent search and email marketing and over a decade and half of software architecture and development. When he's not pointing businesses in a smarter direction, Mike spends his time pointing his lens at wildlife. Connect with Mike on Linkedin, read his Nature Research Photography blog, or reach him via email or phone.