The Transactional Inbox's Promise and Peril In 2014

by , Dec 18, 2013, 9:05 AM
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I’m predicting nothing for 2014. Most of the next big things, trends to watch, and emerging threats we all predict in December -- like the transactional inbox -- are already happening, so they’re more observations than predictions. That said, it’s my observation the transactional inbox is on the verge of becoming important. It could represent the biggest opportunity email marketers have seen in a long time, even as inbox evolution introduces major challenges for 2014.

The transactional inbox is a converging set of developments that let consumers engage with messages in new ways that make the email experience more like the site experience. Some are purely technology-driven, like HTML5’s growing adoption rate, which could (theoretically) allow most subscribers to watch videos in their inboxes. The growing use of dynamic email content goes even further, offering the ability to geolocate customers and swap in messages or offers based on where they are, or even to serve live content. (There are looming challenges here, too. More on these below.) 

Just as dynamic content has the potential to make offers in the inbox hyper-relevant, remarketing campaigns are delivering offers on SKUs from abandoned carts or items viewed during recent site visits, providing the same product details available on merchants’ sites. This kind of email makes the inbox a highly customized catalog with a shopping experience increasingly comparable to typical ecommerce environments. In other words, transactional.

Other developments that make the inbox transactional are based on new ways to sort and deliver to email marketing. Gmail’s tabbed inbox is the biggest example of this, where the Promotions tab has already become a catalog of email offers. Moreover, these offers (again, theoretically) come only from brands that subscribers want relationships with, and who in turn know them well enough to make their messages relevant and valuable. Shopping engines that send email alerts (e.g., camelcamelcamel.com, dealnews.com, huckster.com, priceambush.com, pricepinx.com, shopittome.com) are contributing, too, by adding self-curated offers to the inbox catalog.

By the way, a host of skeptics are still waiting for engaged Gmail subscribers to stop reading messages like these in the promotions tab, but they haven’t yet. Consumers who traditionally responded to email marketing continue to respond to email marketing even when it’s a click away from the primary inbox.

It’s true that the indifferent remain indifferent, too. We saw that when we first looked into the effect of tabs. The big dropoff came from unengaged users who went from rarely reading promotional messages to almost never reading them. You’ve got bigger problems than Gmail if these sound like your core customers. The rest are still reading email and -- thanks to richer message content -- increasingly shopping in the promotions tab.

As the inbox continues evolving toward a shopping experience, email marketers are poised to see greater return on their creative; longer response curves, as messages are treated more like catalog pages than fleeting traffic drivers; and stronger, more profitable customer relationships, as subscribers help guide them to increasingly relevant offers.

Gmail Giveth…

The transactional inbox could usher in a new era in email marketing, but there are some real threats to this beautiful vision. The most obvious comes from Gmail’s recent announcement that images will be cached and proxied, which complicates or outright disables some of the dynamic content capabilities I mentioned earlier. This decision addresses known security vulnerabilities, and just as other mailbox providers are paying close attention to Gmail’s inbox changes, they’re clearly weighing the need to follow Gmail’s lead on image handling.

The other impediment to marketers’ ability to take full advantage of the transactional inbox also comes from mailbox providers, and again Gmail provides the clearest warning. As consumers embrace the idea of shopping from the inbox, they become highly attractive targets for inbox advertisements that look like email. Sponsored messages included in the Gmail inbox compete with senders’ offers and reach highly segmented audiences -- even specific individuals whose engagement histories match detailed customer profiles -- and can display more prominently than email messages. The battle for the inbox and subscribers’ attention used to pit senders against each other, but these ads pit them against the mailbox providers; don’t expect a level playing field.

The saving grace for email (real email) is ROI. As long as email continues to offer unrivaled returns -- thanks to brands’ continued dedication to sending exactly what subscribers want, and also to the growing effectiveness of the transactional inbox -- marketers will follow the money and stave off competition from fake email. But this threat applies a new pressure to scrutinize messages, add value, engage subscribers, and build real relationships.

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