Email Marketing: How a U.K. toy company used behavioral marketing to triple email revenue and increase returning shoppers by 60%

With around 130 shops across the United Kingdom, The Entertainer is the country’s largest independent toy retailer. In spite of that title, the company maintains a traditional toy shop feel with a smaller store footprint.

“We've grown very quickly. So, over the last five years, we've probably opened at least half of our shops, probably more. So, we're opening about between 15 and 20 new shops every year,” said Rob Wood, Head of Online and Digital, The Entertainer.

Part of that growth has been expanding and focusing on the company’s website, TheToyShop.com, which has tripled sales in the last three years.

“A big part of that is our click and collect service. About 40% of our online orders on TheToyShop.com are actually picked up by customers in stores, and that's been a real key factor in growing both the online and the store business over the last few years,” he said.

CHALLENGE

A challenge the company faces with customers is that “the people who the toys are bought for are often not the people buying the toys. Generally, it's not children buying from us online, it's their parents,” Wood said.

Another challenge is that many customers only really shop once or twice a year because they’re typically buying presents around occasions like Christmas or a birthday.

“We realized that lots of our marketing efforts were being wasted because we weren't able to link a customer to a particular event. So, we never knew across the year which section of our customers have a birthday coming up they needed to buy for,” he said.

The third challenge they were trying to overcome was the fact that they sell products that are quite disparate. For instance, someone who is interested in purchasing Star Wars toys probably won’t be buying a My Little Pony set.

“For us, lots of our products can actually put off other parts of our audience if we're not careful to tailor what we show to them,” he said.

CAMPAIGN

The primary goal for this campaign was to grow revenue via email without barraging customers with more sends or by doing deeper discounting.

“[We were keen to] give all of our customers relevant promotions, product recommendations and news throughout the year and actually get a more engaged customer database rather than necessarily growing the database or [being] more aggressive with our prices,” Wood said.

Prior to this campaign, the brand’s email marketing was fairly basic, he added.

“At the time, we had an email list of probably about half-a-million. Essentially, they all got the same message a couple times a week,” he said.

For these sends, the team would bundle together promotions or the latest product launches and send them out.

“But, obviously, in doing that, we were missing lots of customers who would be interested in something that we had in our range, but not necessarily the offer they were hearing about,” he said, likening it to only putting one item in the shop window for people to look at.

Step #1. Make data efficient within your system

The toy shop’s order system and ecommerce platform were separate. So, starting off this email program change would have been a big challenge for any marketer, pulling together all of the different data that was held in different silos and pushing it all onto one CRM system.

“Lots of the product information and order information was being held in one place and lots of our customer information was being held in another place,” Wood said.

Due to this storage problem, a lot of the valuable data they had was under-utilized up until this point. By pushing all of that data through into one CRM system, the team was able to use it more cleverly.

That process took about six months, he said, and lead to the launch of the new email campaigns in autumn of last year — meaning they have been live for a little over a year.

Step #2. Use data to solve customer issues

The first campaign sent out was the Birthday Club, which “allows grown-ups to tell us the birthdays of the children they're buying for — so, it could be their children, their grandchildren, it could be nephews and nieces or their children's friends, for example,” Wood said.

In addition to sharing children’s birthdays, grown-ups’ responses tell The Entertainer Toy Store whether the children are boys or girls and how old they are.  With that information, they’re able to target the parents or adults four weeks beforehand and send them a list of personalized recommendations. 

“We'll send them our bestsellers for children of that age. It has kind of a double benefit,” he said. “Obviously we're showing products that are likely to appeal to somebody buying for a child of that age — but also it gives it that credibility.”

If the child isn’t your own, he said, you may not know much about them. But when you have the affirmation that others are buying these products for a child of that age and gender, you get a pretty good idea of what they’ll like.

“Because we were able to offer [suitable recommendations,] it gives us a lot of credibility, and it gives the customer some confidence,” he said.  

The campaign begins four weeks out with three emails sent running right up to the child’s birthday. The emails essentially say, "Have you forgotten the birthday? Do you want to buy a gift card?"

The team has around 80,000 children's birthdays in the database currently, which is “still fairly small for us, but it's something that we're trying to grow … We find that people who are in this database spend twice as much every year as someone who's not in it,” Wood said.

Step #3. Use data to create relevant email features for customers

The toy industry is driven by trends and collectibles, Wood said, “so you'll suddenly get a hot property which nobody had heard of a year ago, and suddenly the sales are through the roof because everybody's massively into it.”

The movie "Frozen" is a good example from last year, he added, where the phenomenon and demand for associated toys came out of nowhere, and it was suddenly a must-have brand.

The CRM system allowed Wood and his team to look at customers who had previously purchased "Frozen" items or browsed "Frozen" on the website and add them to a specific email segment.

“We tend to email weekly or fortnightly with the latest ‘Frozen’ product releases, and if there's a promotion on, we'll tell those customers first,” he said.

Wood and his team do a lot of work around preorder, he said, and if they know these customers are preordering these particular products, it helps to tell them first because they’re more motivated.

“We find that the spend and engagement is double [compared to] the customers we don't have in this segment just because it's so much more relevant to them,” he said.

Another important feature for these emails — and the email program overall — is that the emails now coordinate so that when a customer opens an email, the toys shown are definitely in stock.

“The best-selling toys will be in and out of stock through the Christmas period,” Wood said. Take a newly popular toy called Hatchimals for example; the store had “over 1,000 last week, and they sold out within half an hour.”

Situations like this can present a problem, because obviously, if you have an product in high demand like that, you want to include it in your email marketing as quickly as possible because you know it’s going to convert well. However, the uncertainty over how long it’s going to stay in stock makes this tricky — you don’t want customers clicking through only to see that the item has been sold out.

“The advantage of having live product lookups from email is that we can let the system decide for us which products to offer to the customer,” he said.

The team looks at recent best-sellers and what customers have purchased in the past. If a certain best-seller is relevant to that customer, it will be shown in the email. If an hour after the email is sent that best-selling item is sold out, the customer will be shown a different recommendation when the email is opened.

For instance, this is the same email send as the version above; however, a customer opened this one later in the day.

“We're making the most of each time a customer opens the email. I think for us, our open rates are somewhere between 10% and probably 20% for a really good email. It's a lot of hard work getting people to open our emails … so each time someone does open an email, it's really important we show them the best product we can that's in stock and the most relevant to them at that time,” Wood said.

He and his team also segment with personalized subject lines for different groups of customers. For example, they might highlight “50% off Star Wars” as a subject line to some during a sale, but send “50% off My Little Pony” to other customers who have browsed or bought that brand before.

They recently used this strategy during a “Penny Sale,” where customers can buy one, and get one for a penny.

“This [sale] is across different brands and different categories. So, it's quite a diverse range of products stuck in this category …  so we've got customers that we know like Lego, for example, so they would get a subject line [like], ‘Check out the Lego in our Penny Sale,’” he said.

Another element integrated was countdown timers that could be put into emails that count down to the last shipping date during promotions like “Penny Sales” and holiday sales.

“We're constantly going in and out of different promotions. So, one of the key successes of [the timers] is when we've got a promotion ending, we're able to say: ‘This is the countdown. You've got six hours left to purchase.’ And that's really, really powerful,” he said.

Step #4. Optimize emails for mobile

While evolving the email program, the team also focused on mobile optimization, making sure the emails and website could be properly used by customers on any platform.

This has been a “key development,” according to Wood, because, “There aren't very many people who open their emails on a desktop anymore.”  

By getting the right products and recommendations into emails, as the team had done in previous steps, it was now easier than ever for customers to “clickthrough and buy straightaway because [the emails are] offering [the customers] really relevant content. [Customers are] not having to go into the website and search around,” he said.

RESULTS

“The fact that we can offer different promotional messages to different groups of customers has been really powerful,” Wood said.

In the past year, The Entertainer has tripled email revenue through these tactics as well as doubling email open rates. The team has also seen:

• A 44% increase in clickthrough rates
• A 120% increase in mobile sales
• A 60% increase in returning shoppers

“Obviously, one of the things we pride ourselves on in stores is that we can offer really great expert advice to people trying to buy for children. Our recommendations replicate that sort of service online,” Wood concluded.

Creative Samples

1. Birthday club
2. Dynamic content – AM email
3. Dynamic content – PM email
4. Countdown timer

Sources

The Entertainer

SmartFocus – The Entertainer’s messaging vendor

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