Email marketing has become much more than just sending promotions to inboxes. In recent years, email strategy and email platforms have evolved into sophisticated customer experience data hubs. Brands are tapping into first-party data to send hyper-personalised and relevant messages. However, many businesses still miss out on maximising email’s potential, with email accounting for only around 5-10% of revenue, though platforms often report much higher numbers, up to 50%. Let’s explore how businesses can make email a more powerful tool in their digital marketing strategy.
Shifting from Basic Email Tools to Data-Driven Platforms
In the early days, email tools were simple. Businesses used them to send newsletters, promotions, and transactional emails. But times have changed. Today, many email platforms have expanded into full-fledged customer experience data platforms. By leveraging first-party data—information that customers willingly share—businesses can create a more personalised experience. For instance, brands like Mailchimp and Klaviyo have integrated customer journey mapping, allowing companies to see every interaction customers have had with their brand. This means businesses can segment their audience more effectively and deliver messages at the right time.
Brands are now collecting data on when customers might need product replenishments or guidance, such as how-to guides. Rather than blasting out generic messages, these platforms allow companies to be more strategic. The result? Higher engagement rates and, ultimately, more conversions. It’s all about delivering the right message to the right customer at the right time. Personalisation is no longer just a buzzword; it’s a necessity.
The Untapped Potential of Email Revenue
When we look at the data, email still represents a small slice of total revenue for most businesses. On average, around 5-10% of revenue comes from email channels, yet email marketing platforms often report 50% or higher when they calculate the revenue directly generated by their tool. This discrepancy points to an underutilisation of email’s potential. But why?
The answer often lies in segmentation. Many businesses fail to spend enough time understanding their customers to send highly targeted campaigns. Instead, they rely on generic email blasts that don’t engage the recipient. However, when businesses take the time to create segmented, targeted email flows, the impact can be dramatic. For example, abandoned cart emails, automated reminders, and personalised recommendations are all strategies that have been around for years, but many companies aren’t making full use of them. A simple shift in focus could significantly increase email’s contribution to overall revenue.
Utilising Customer Experience to Drive Email Success
For email to drive revenue effectively, businesses need to think about the entire customer experience. Imagine browsing on Instagram, spotting a product that captures your interest, and clicking through to the brand’s website. Now, if the experience doesn’t align—perhaps products are out of stock, or the site is poorly designed—the interest quickly fades. The same applies to emails.
Email workflows need to be seamless and align with the customer’s experience on other platforms. Let’s say a customer adds an item to their cart but doesn’t complete the purchase. A well-timed email might prompt them to come back, but if that email doesn’t reflect the same quality or value they experienced elsewhere, it won’t have the desired effect. That’s why it’s crucial to ensure consistency across all touchpoints, from ads to email, to the website. When the customer journey feels fluid, they are more likely to complete their purchase.
Key benchamarks
- Definition: Open rate measures how well your subject lines and send times are performing.
- Industry Benchmark: 18% – 25% is typical for most industries.
- Diagnostic: Low open rates indicate that the subject lines aren’t compelling enough, or the email timing is off. Poor list quality can also lead to lower open rates.
- Definition: CTR shows how engaging the email content is and how well your call-to-action performs.
- Industry Benchmark: 2% – 4% CTR is a good benchmark.
- Diagnostic: If your CTR is low, it may indicate a misalignment between what your subject line promised and the email content or that the CTA isn’t clear or strong enough.
- Definition: CTOR measures the quality of your email engagement by comparing clicks to opens.
- Industry Benchmark: 10% – 20% CTOR indicates a well-targeted message.
- Diagnostic: A low CTOR, despite high open rates, suggests that the content is not engaging enough or doesn’t align with recipient expectations.
- Definition: This measures how effective your email is at driving the desired action (e.g., purchase, signup).
- Industry Benchmark: 2% – 5% for most industries.
- Diagnostic: Low conversion rates indicate issues with email content, landing pages, or CTA effectiveness.
- Definition: The percentage of emails that were not successfully delivered to recipients.
- Industry Benchmark: < 2% to maintain a good sender reputation.
- Diagnostic: High bounce rates can lead to deliverability issues and indicate problems with email list quality.
- Definition: The percentage of people who choose to unsubscribe from your mailing list.
- Industry Benchmark: < 0.5% is considered healthy.
- Diagnostic: High unsubscribe rates can signal that you’re emailing too frequently or that the content isn’t resonating with recipients.
- Definition: The percentage of recipients who mark your email as spam.
- Industry Benchmark: < 0.1% is ideal for avoiding deliverability problems.
- Diagnostic: High spam complaints will damage your reputation and decrease future deliverability.
Moving Beyond Discounts: Value-Driven Campaigns
One of the most common mistakes businesses make is over-reliance on discounts to drive conversions. The team at Proof3 often sees companies offering 10% off or free shipping to customers who abandon their carts, assuming that’s what it takes to close the sale. However, this can eat into margins unnecessarily. Instead, businesses should focus on delivering the value of their product.
For example, one brand saw significant success by addressing this directly in their email. Instead of offering a discount, they explained why the product was already at its best price and highlighted the product’s value. This value-driven approach resonated with the customer, leading to a purchase without sacrificing margin. It’s about changing the conversation. Instead of giving away discounts, brands should give customers reasons to buy based on quality, benefits, and value.
The Power of First-Party Data in Email Campaigns
With third-party cookies on the decline and privacy becoming a bigger concern, first-party data is becoming more valuable than ever. Collecting and using first-party data allows businesses to have more control over their customer interactions. For instance, by gathering data on customer behaviours—such as purchase history, browsing habits, and preferences—brands can tailor their emails more effectively.
This shift towards first-party data doesn’t come without challenges. Many businesses struggle with how to collect and process this data efficiently. However, tools like Google Tag Manager and other customer experience platforms make it easier to harness this data. The key is to ensure that the data collected is used to enhance the customer journey. When done right, first-party data can create highly relevant email campaigns that resonate with customers, driving higher open rates and conversions.
Leveraging Automation to Enhance Personalisation
Automation has been around for a while, but many businesses still aren’t taking full advantage of its potential. Tools like Klaviyo, ActiveCampaign, and others allow brands to automate flows based on customer behaviour. For example, an automated email can be triggered when a customer views a product but doesn’t add it to their cart, prompting them to return.
The beauty of automation is that it enables businesses to send timely, personalised messages without manual intervention. It’s not just about saving time—it’s about sending the right message at the perfect moment. Whether it’s a reminder to purchase, a personalised recommendation, or a simple thank-you message, automation can make a significant difference in how customers perceive the brand and their likelihood to convert.
The Importance of Continuous Testing
One of the biggest challenges businesses face is understanding what works and what doesn’t. That’s why testing is crucial. No two businesses are the same, and what works for one brand might not work for another. For instance, A/B testing email subject lines, layouts, and call-to-actions can help refine what drives the most engagement.
Testing shouldn’t be a one-time thing. Consumer behaviours and preferences change over time, and businesses need to keep up. Regularly testing and optimising email campaigns ensures that they stay relevant. And when you combine this with the insights gained from first-party data, you’re in a prime position to make data-informed decisions that drive results.
Building a Long-Term Email Strategy
Email marketing isn’t a quick fix; it’s a long-term strategy. To get the most out of email, businesses need to think beyond individual campaigns and start building a comprehensive email strategy. This includes everything from setting up automated flows to continually refining segmentation strategies.
Brands should also keep an eye on new developments in the industry, such as AI-driven personalisation and evolving customer expectations. The landscape is constantly shifting, and those who adapt will be the ones who succeed in the long run. Email remains one of the most direct and effective ways to communicate with customers, but it requires an ongoing commitment to testing, personalisation, and optimisation.
Testing shouldn’t be a one-time thing. Consumer behaviours and preferences change over time, and businesses need to keep up. Regularly testing and optimising email campaigns ensures that they stay relevant. And when you combine this with the insights gained from first-party data, you’re in a prime position to make data-informed decisions that drive results.
Email remains one of the most direct and personal ways to reach customers, and with the rise of customer experience platforms, it’s easier than ever to personalise messages and drive conversions.
First-party data gives businesses control over customer insights, allowing them to create hyper-personalised emails that speak directly to individual preferences, resulting in higher engagement and sales.
Platforms like Klaviyo and DotDigital stand out for their advanced automation and personalisation features, while Mailchimp remains popular for its ease of use.
Not necessarily. Offering value and highlighting the benefits of your products can be more effective in the long run without sacrificing margins.
Automation allows businesses to send timely, relevant emails based on customer behaviour without needing manual input, resulting in more consistent and effective engagement.
A successful email strategy requires continuous testing, personalisation, and adaptation to new trends, ensuring your emails remain relevant and engaging for the long term.
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Ilan Butler
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