How Email Wins Customers

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Stio approaches its email strategically.
Stio approaches its email strategically.

Email is a mainstay for lead nurturing and customer retention. It can also be a powerfully effective channel for customer acquisition.

To be effective, however, an email message must meet three basic criteria: designed to avoid spam filters, intriguing enough for prospects to open, and include messaging and a call-to-action that will convert consumers from prospects to buyers. These are challenging, but doable.

There are several ways to avoid spam filters beyond the obvious, like an appropriate subject line. One is to select contacts with caution. Many marketing experts recommend using trusted partners to reach potentially interested prospects. Target customers will be more inclined to open an email that comes from a trusted partner—such as a local sports team—rather than from a brand that they haven't sought emails from, notes Dan Smith, vice president of product for digital engagement platform Outsell LLC. And, of course, marketers should seek permission for subsequent email contacts.

Another effective way to get email through the spam filters—and opened by prospective customers—is using sweepstakes, according to Ross Kramer, CEO of email solutions provider Listrak. “You can create engagement around a prize,” he says.

In fact, engagement is essential when using email for customer acquisition. “The point of email marketing is to expose your brand to prospects,” says Matt Nissenbaum, media supervisor and team lead for WebMetro, an Internet marketing company. “The main thing to focus on is user engagement. The goal is to get people to sign up.”

Marketers have mere seconds to persuade prospects to open an email, so subject lines need to be compelling. Nissenbaum recommends using language that's clear, concise, and includes a specific call-to-action with a sense of urgency, like free shipping or a promotion that will compel prospects to become customers now. Kramer suggests offering incentives, such as 5% off a customer's first purchase, to move the consumer from email viewer to customer.

For Stio, email is a breath of fresh air

Stio is one company successfully using email to bring new customers into the fold. “Email is our best returning channel [for customer acquisition],” says Noah Waterhouse, director of marketing for the direct retailer of outdoor/mountain lifestyle apparel. “It's very cost effective.”

The reason? Stio approaches its email strategically. The company tracks performance metrics to continuously revise its email campaigns, Waterhouse says. Stio reviews email opens, click-throughs, and the like to determine the effectiveness of all its campaigns, as well as to optimize frequency. A drop in opens or click-throughs can indicate that the company is sending out emails too often, Waterhouse explains.

Stio also uses customized landing pages, so prospects who click through an email will have a more personalized experience. For Stio, according to Waterhouse, customized landing pages result in a higher conversion rate than a generic landing page. “Customers welcome timely communication that informs them about the brand,” he says.

But using email for customer acquisition doesn't end with the first email—at least not for Stio. Waterhouse notes that the company uses post-purchase campaigns to help ensure that new customers become repeat customers.

As a result of its considered approach to customer acquisition via email, Stio has seen email conversion rates of 6%, which translates to 20% of the company's total revenue. Based on Stio's success thus far, Waterhouse expects email to contribute 30% of total revenue in 2014.

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