Commentary

Triggered Emails: Low Volume, High Returns

by Loren McDonald , Op-Ed Contributor, May 7, 2010

Many email marketers continue to search for the right frequency, asking, "How many emails can we send before we drive away too many subscribers and turn increased short-term gains into lowered long-term results?"

To me, however, the key question is "How do we send more relevant emails more often but with fewer resources?"

Enter automation and trigger-based messages. While low in volume, triggered emails can deliver off-the-charts results. Three examples:

A major travel site generates 45% of its email profits from triggered messages that make up only 3% percent to 5% of its total message volume.
An online specialty-products retailer found that 40% of its email revenue comes from transactional/triggered messages, which make up only 4% of volume.
Birthday email messages generate 25 times the revenue as a regular broadcast email for a uniforms retailer.

Interestingly, these automated "right time, right message" emails enable marketers to touch many of their subscribers and customers not only at an increased frequency, but with significantly higher relevance. Done correctly, these triggered emails may also increase subscriber engagement with your regular broadcast or segmented emails.

Answering Marketer Skepticism on Lower-Volume Messaging

Triggered and "lifecycle" messages allow you to send a greater variety of tightly focused messages to relatively smaller segments of your database. On any given day or week, however, only a small percentage of your database would receive a communication from you.

Many marketers believe that low-volume programs can be successful by themselves but not generate enough revenue on a grand scale to replace high-volume broadcast messages.

They're right, too. Perhaps only a few percent of your customers receive a purchase confirmation in an average week, or 2% receive a birthday greeting.

However, these more-relevant triggered messages can produce returns that are many times greater than your broadcast messages.

Add the incremental revenue from that birthday message to the other revenue from a strategic set of 10 to 12 automatically triggered emails, and you begin to see the potential.

Is This the End of Broadcast?

Not by a long shot. Automated messages, which send a greater variety of messages but to relatively smaller segments of your database, will supplement rather than replace your broadcast messages.

You can communicate more often with customers via more timely and valuable messages. They work so well because they are based on behavior, preferences and demographics.

But broadcast and targeted/segmented messages still deliver significant results because of their sheer volume, frequency, brand reminder and luck of timing.

Also, most triggered messages for ecommerce companies go to existing customers. So, you need broadcast and segmented emails to convert prospects into paying customers.

That said, automated messages provide these advantages over traditional broadcast messages:

"Set it and forget it." Once you create and test your message framework, it runs largely by itself.
"Do more with less." Once produced and optimized, automated trigger messages free up staff time for testing, analysis and optimization of your overall program.

How to Add Triggered Messaging to Your Email Marketing Strategy

If you don't use triggered messages now, or if you deploy only one or two, you don't have to boil the ocean to take your program to the next level.

Start by adding a message that delivers the most value, such as cart abandonment, a welcome series, and adding cross-sell/upsell content to transactional messages.

Test content, layout, offers/no offers, timing and cadence. Then, add another triggered message.

There are literally dozens of lifecycle/triggered-type messages you can deploy. Here are just a few examples:

Behavior-based triggers

Welcome emails
Cart-abandonment reminders
Payment reminders
Account creations or closings
Web page abandonment
Product reviews and ratings
Reactivation campaigns
Purchase or account-creation anniversaries
Order confirmations and status
Shipping notices
Customer-service contacts
Account inactivity/uncompleted process
Surveys and follow-up
Subscription renewals and reminders

Demographic/preference triggers

Age
Marital status
Birthday
Wedding anniversary
Children's ages/birthdates/due dates
Location
Preferred content categories
Wishlist/product interest

The next time your boss says "Send another email," seize the opportunity to gain support for adding more "set it and forget it" triggered messages, rather than another "pray and spray" message based on hunches rather than customer behavior and interests.

I would love to hear your experiences with triggered messages and how you are balancing them with the demands for sending higher-volume broadcast messages.

Until next time, take it up a notch!

7 comments about "Triggered Emails: Low Volume, High Returns".

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Jim Lillig from Synergy Intermedia, May 7, 2010 at 11:38 a.m.
Great article. Not sure if you are aware of Listrak.com's solution. They have led the way in ESP's providing triggered event emails. Very effective particularly for initial emails as well, it helps them self select what they are interested in and then allows you to follow up immediately with a very targeted relevant message.
Reply

Gregg Oldring from Mailout Interactive, May 7, 2010 at 12:51 p.m.

I mostly agree with Loren. However, there are a real dangers with triggered emails that I think are not discussed often enough.

Irrelevant triggered emails make us look stupid.

The "set it and forget it" notion is problematic. Careful attention has to be paid to triggered email programs to be sure that the emails being sent are in fact relevant. In many cases, the human effort required to manage a triggered email program comes close to the human effort required to send 1 to 1 emails. An email from an empowered support or sales person is more likely to be relevant. In my experience, spending the money to send a 1 to 1 email would have been preferable to many of the triggered emails that I have received.

Loren McDonald from IBM Marketing Cloud, May 7, 2010 at 1:11 p.m.

Gregg - You raise some good points, so some clarification. It sounds like your concerns are primarily with Customer Support emails and those from "Salespeople", etc. I agree, done wrong, those kind of automated messages can provide a very poor, or unexpected customer experience.

In general, however, I was not referring to those type of emails, but rather retail/ecommerce messages triggered off behavior and preferences/demographics.

On "set it and forget it" - my point is that once these programs are set up, they should require very little human intervention. You do not have to create a new message every time one goes out. That said, you should continue to test and optimize these triggered messages to maximize your return.

But I still believe that these type of automated lifecycle messages will generally provide the greatest ROI and margins in your email program.

Deborah Krier from PNTA, May 7, 2010 at 3:05 p.m.

Another issue fueling skepticism on Lower-Volume Messaging is program ROI. While the per message ROI may be high, if you need additional technical and system resources to get your triggered email program implemented, it may take years before you recoup your start-up costs.

While I agree that triggered messaging is the right way to evolve your email marketing program for long-term success, getting the necessary buy-in from the CFO, who may be primarily concerned with short-term finances, can be a real hurdle.

Loren McDonald from IBM Marketing Cloud, May 7, 2010 at 4:53 p.m.

Deborah, Great point as well on the resources and mgmt demands. It was really for those two reasons I wanted to write this column. You've nailed two of the biggest challenges to marketers moving their email program to one that is based more on lifecycle messaging and automation.

So arming marketers with examples of the type of returns and percentage that it can comprise of your email program is perhaps the biggest weapon to use when speaking with management about resource and budget allocation.

As you are right, moving to these automated programs requires management to have patience, to buy into the fact that building programs that only send out thousands of emails instead of millions will pay off in the end.

We had one client that built a model that showed best and worst case scenarios and got management to buy off on moving to create 150 lifecycle templates - based on the worst case scenario. It worked and it has since paid off.

Thanks for the comments - as you are right in the end you have to convey the revenue benefits of a long-term program to the "known" results of a short-term broadcast email.

Derin Oyekan from Revenue Republic, May 7, 2010 at 7:17 p.m.

Great article. I'm a very big proponent of triggered emails and lifecycle marketing. I've worked at companies that used a very myopic batch and blast approach much to their dismay long term. There are a lot of moving parts with a program like this no doubt. Creative, programmatic, database, analytics etc. but isn't that true of any other form of digital media? I'm unmovable in my belief (and plenty of case studies support it) that lifecycle/user-centric communications are absolutely the ONLY way email marketing should be done

Andrew Kordek from Trendline Interactive, May 8, 2010 at 12:34 a.m.

Great article Loren. A couple of triggers that I have been involved with in the past that are extremely successful are:

1. Retail store trigger. Purchase item in store and trigger an email to complement or up sell. (of course, this can only be effective if you have a retail store presence)

2. Thank you email. A simple..thanks for your purchase.

3. Dynamic product recommendations put into the transactional or triggered email. Great company that does this is richrelevance.

4. Browse based email. Amazon rocks at these.

5. Gift registry triggers.

If you are a retail organization either with an online or store presence and you are not doing triggers...wonder how much $$ you are missing by not investing your time in doing it.