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Join Our Research Team at DMA 2014
Aug 23, 2011
Case Study

Email Marketing: Triggered emails that target the conversion funnel boost revenue

SUMMARY: Your audience is on a path to conversion. By helping them through the process, you can get more of them to the final goal, and see increases in both customers and sales.

In this case study, learn how an online gaming vendor increased sales with three triggered emails that targeted crucial steps in its conversion funnel. Also, see the calculation they used to determine incremental revenue generated by each email, and at which points in the funnel text-based emails performed better.
by Adam T. Sutton, Senior Reporter

CHALLENGE

GamersFirst had just finished overhauling its email program. The free-to-play online game provider was sending confirmation emails, newsletters, and promotions, and had its deliverability in order. Now it was time to start driving revenue.

"We really wanted to turn our email marketing program from a sort of cost center, which is how it is usually considered, into a profit center. We wanted the executive team to really look at it as something that made us money and not just a necessary evil," says Frank Cartwright, SVP, Product and Platform Development, GamersFirst.

GamersFirst sells digital items and premiums for its games, such as virtual smoke grenades for its warfare game. A key challenge for the company is that new users cannot consider a purchase before playing a game, and there are several steps they must take before playing.

Cartwright and his team wanted to use email marketing to coax more users through those steps. Only then could they start playing and make purchases.

"There were a lot of missed opportunities and there were a lot of places where we were losing users and really needed to engage with them."


CAMPAIGN

Cartwright's team created a system of triggered emails to encourage new users to start playing games and continue on the path to conversion. Here are the steps the team followed:


Step #1. Map the path to conversion

Ultimately, Cartwright's team wanted new users to purchase a digital product for a game. There were several steps users had to complete first:

1. Register - new players need to create an account with a valid email address to register with GamersFirst.

2. Verify registration - new players need to respond to an automated email to verify their registration. This helps GamersFirst thwart cheaters, and ensure good delivery rates for its emails.

3. Log in - new users have to log in and play a game before they will consider making a purchase.

4. Purchase - active users spend money on digital items.

There are other steps involved in a new user's start-up process, such as downloading software and playing a game for a long enough time to feel the urge to make a purchase. However, the above steps were the team's focus in this effort.

- Benchmark performance

The team calculated percentages to measure how many new users completed each step. For example, starting at 100% of users who register, 70% verify, 60% log in, and 40% purchase (these are not the team's actual measurements).

The team used an average across all its games for the effort. Setting these benchmarks was the only way to know if the team's later actions improved results and encouraged more users to convert.


Step #2. Create email to encourage validation

When a new user signs up at GamersFirst, they immediately receive a transactional email confirming registration, and asking them to validate by clicking a link. However, not everyone validates the accounts; it is this group that Cartwright's team targeted first.

The team created an email to send to people who failed to click the validation link in the confirmation email. This reminder email had the subject line: "Activate Your GamersFirst Account Now"

- Test timing

The team started by sending this email three days after the confirmation email. Through testing, the team improved results by sending the email sooner.

"There is a fine line. We had to be careful not to have them register and not validate and then two hours later we send them an email asking 'why didn't you validate?' We didn't want to scare them away ... but we also didn't want to wait until a week later where they could come back and ask 'who is GamersFirst?'"

The team has since settled on a 24-hour timeline. After receiving a confirmation email, new users who do not verify their accounts will receive a reminder email within 24 hours.

- Test messaging and style

The team tested different copy and layout styles for the emails and found that a simple, text-based email outperformed image-based emails.

"The one we actually use today is just simple text. We initially tried to incorporate some graphics and create a better-looking one, but the basic text message has been the best for us."

- No customization

The online gaming community does not always respond well to heavy-handed marketing, and Cartwright's team wanted to avoid scaring off new users. With this in mind, the team did not incorporate any personalization in this email, such as a first-name greeting, and does not collect that information from new users during signup.


Step #3. Analyze the email's impact

GamersFirst spent about three months testing and tweaking the verification reminder. After this period, the team sat down to analyze the results and calculate the impact.

The team was able to show an increase in the percentage of new users who verified their accounts. Since GamersFirst had specific numbers for conversion rates throughout its funnel, the team could then estimate the revenue generated by the email.

For example, in hypothetical numbers, if the team garnered 200 more verified accounts on a daily basis:

o 100 of those accounts would log in to a game

o 10 would become paying customers

o This figure could be multiplied by the team's average customer lifetime value

Although the results were at the low end of its projections, the team was happy enough with the response to repeat the process on subsequent steps in the conversion funnel.

"Even the lowest projection gave us incremental revenue. And if you look at the cost, we felt like without this we were leaving money on the table," Cartwright says.


Step #4. Repeat process for subsequent steps

GamersFirst now wanted to encourage users to complete the final two steps in the conversion process -- log in and purchase. The team designed the following emails:

- Login reminder

Once customers register, they have to download a game and log in. This can be a large step for new users since some games have long download times. The team crafted a reminder email to reach users who got to this step but did not log in.

Two reasons people could fail to log in: they had trouble during the process, or simply forgot after being distracted. With this in mind, the team's reminder email had two call-to-action buttons:

o Link to download a game and log in
o Link to player's guide

Through testing, the team found that sending this email three days after new users verified their accounts worked best. Also, since users register for a specific game, the team found that graphical emails with imagery from the game performed better than text-based emails.

- Purchase reminder

Once users log in and played a game, the final step was for them to purchase an item or upgrade for the game. The team crafted a triggered promotional email to encourage users to make a purchase.

This email was sent within 30 days after the user's first login date. Through testing, the team found that these emails performed best when including:

o Imagery from the user's game
o Description of product
o Discount or "buy-one, get-one" offer
o Offer deadline

- Multiple versions

While the team found that the verification email could be generic and text-based, it found that emails targeting these later steps performed best when featuring game-specific content. This multiplied the number of email designs the team needed in the program, as each step needed emails for multiple games.


RESULTS


Typically out of 10,000 registered users, GamersFirst gets 400 paying users -- or a 4% conversion rate -- from registration.

GamersFirst was able to get an additional 3.75 paying customers for every 1,000 validation reminder emails it sent, or a 0.38% conversion rate. At an average customer lifetime value of about $125, that's $469 for every email sent.

The team was able to get an additional seven paying customers per 1000 emails sent for both the login reminder email and the promotional email, or a 0.7% conversion rate for each. That's about $875 for every 1,000 login reminder sent and another $875 for every 1,000 promotional emails sent.

Cartwright's team is encouraged by the results and continues to test the emails to improve their conversion rates. For example, the team plans to test sending promotional emails based on users' time spent in a game, rather than the time elapsed since the first time they logged in.

"If we see a player that just logged in once and never came back, that probably indicates a different problem than somebody that has played a whole month and who hasn't paid," Cartwright says.

GamersFirst's triggered email program is just one of many we've analyzed. If you're interested in reading more email marketing case studies and how-to articles, subscribe to the complimentary Email Marketing newsletter.


Useful links related to this article

CREATIVE SAMPLES
1. Text-based validation email -- test winner
2. Image-based validation email -- test loser
3. Login reminder email
4. Purchase conversion email

StrongMail - the team's email service provider

E-commerce Testing: Redesigned order page, shortened shopping cart drive 13.9% lift in conversion

Email Marketing: Dynamic images get 5 opens per reader on a single email

Email Deliverability Tested: How “FREE” produced a 6.7% higher clickthrough rate

Members Library -- Remarketing Emails: How JetBlue's automated triggers get 1,640% more revenue-per-email than promotional emails

Members Library -- Email Marketing: How a triggered alert program maintains 40% open rate, 60% click-to-open rate for millions of subscribers

Members Library -- Remarketing Emails: 3-part triggered series generates 53% click-to-conversion rate


See Also:

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