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Join Our Research Team at DMA 2014
Dec 10, 2008
How To

Sharpen Your Autoresponder Program to Retain Customers, Boost Revenue

SUMMARY: Emailing recent customers a few product suggestions after a purchase encourages repeat sales. How do you capture even more revenue after you have an effective automated system in place?

Find out how an eretail team tweaked an award-winning post-purchase email campaign to boost revenue per subscriber and the number of repeat customers. Includes sample emails and key factors.
Marketers have been following up purchases with autoresponders for years. Sending a relevant offer to recent customers to spur additional sales is a strategy that works – and the more relevant the email, the more effective it is.

Stephanie Brocoum, VP Marketing, SmartBargains.com, and her team have been sending recent customers a 30-day post-purchase sequence of emails for about two years. The program has found success with sharper targeting, helping Brocoum and her team increase revenue and number of sales per customer.

“These types of targeted programs are beneficial in any economy, but especially now because they tend to drive higher margin results …The merchandise and the content are so relevant to the customer, we don’t have to offer other incentives on top of our discounted pricing, necessarily, to get them to buy,” Brocoum says.

SmartBargains’ program goes after the most active customers with really personalized content. They revise their strategy constantly to push their retention number.

Find out which factors Brocoum and her team use to refine their autoresponder strategy, how it affects the email’s design, and how her team keeps everything running smoothly.

Start with easy wins

If you do not use a post-purchase email sequence, you don’t need a complicated system to accomplish boosts to the bottom line. Brocoum’s team started by emailing customers product suggestions and a discount based on their purchase category.

“Go after the low-hanging fruit and enhance from there,” Brocoum says. “I think where a lot of people get tangled up is trying to build a recommendation engine that does everything out of the box. And it doesn’t have to be that complicated. You can really just start with the basic direct marketing levers of targeted content and targeted offers.”

“Low-hanging fruit” can consist of interactions with customers on their shopping carts. The “fruit” doesn’t need to be personalized products or up-sells, Brocoum says. “Even just an email contact reminding people that they left something [in the cart] is usually effective.”

Customize emails according to a customer’s lifetime value

SmartBargains.com’s customers can expect an email two days after their purchase. The email is the first of four sent over 30 days; each features a discount and products related to the customer’s purchase.

The email’s content depends on several factors, which Brocoum and her team identified as determinants of customer lifetime value and the likelihood of a repeat purchase. Here’s how each factor affects what customers see in their in-boxes:

Factor #1. Let product category guide discount and featured products

SmartBargains.com offers a wide array of products. When a customer purchases from a certain category, their email sequence features the other products that fall into that group. Each email in the series highlights different products from that category.

The product category also helps determine the discount offered. Brocoum and her team have found that buyers of commodity products, such as mattresses, are less likely to return and, therefore, are offered a stronger discount. Shoe and fashion shoppers, on the other hand, are more likely to return without an incentive, she says.

This factor influenced email content for years. It continues to be an important aspect in content decisions. The next three factors were incorporated last May.

Factor #2. Consider sale channels when deciding discount

The aggressiveness of the email’s discount adjusts for the channel that drove a customer to SmartBargains.com. Customers coming from channels that typically provide low lifetime value receive the most aggressive discounts to help coax a repeat sale. Customers from higher-value channels receive weaker or no discounts – they’re more likely to return without an incentive.

Factor #3. Rely on past purchase price points to determine featured products

The email’s featured products are also determined by the amount the customer is willing to spend. Big-ticket buyers are shown more high-end products because they have different motivations than frugal shoppers.

Factor #4. Take historical number of purchases into account

Frequent SmartBargains.com shoppers are less likely to receive a strong discount as an incentive. The discount is unnecessary. It wastes revenue if a customer is likely to return anyway.

Continue to reach out after the sequence

Customers are removed from the post-purchase sequence after 30 days. They are then added to the general email file, where they continue to receive product suggestions related to their original purchase.

“We really try to make your product offer relevant over your entire lifetime with us,” Brocoum says.

Customers in the general file continue to receive discount offers to generate purchases and reactivate the 30-day sequence.

Anticipate these launch challenges

SmartBargain worked closely with its email provider to automate the sequence and make it scalable. Challenges included:
o Automating product recommendations through analytics
o Understanding the process so it could be refined and tweaked as needed
o Enabling real-time inventory monitoring

“Because we have a constantly evolving product catalog, we have to refresh these product recommendations constantly,” Brocoum says. “We need to make sure that we have the inventory to cover them. We have to make sure that we have products that are of interest to every one of these customers.”

Brocoum and her team created a new position to manage the product selections for the program. The staff members ensures that offered products make sense, are seasonably relevant and reflect the current product mix.

Useful Links Related to This Article:

BNET: SmartBargains.com wins 2006 eTail award
http://findarticles.com/p/articles/mi_m0EIN/is_2006_Aug
st_23/ai_n26966129


SmartBargains.com
http://www.smartbargains.com/


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