How to be relevant to your e-mail customers

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A great many promotional messages to consumers do not get opened. Why? Because the subject line tells the reader, "There is probably nothing that you want to hear about in this e-mail." In other words, the subject line says that the e-mail content will not be relevant to the reader's current needs or interests. If you are sending an identical message to one million of your existing customers, it is unlikely that you can create copy or an offer that will interest all, or even half of them. There is just too much clutter in everyone's e-mail inbox.

There is a solution to this problem. The solution is to divide your one million customers into a number of segments each of which has similar lifestyles or product preferences. Then you create different copy, offers and subject lines that address the particular interests of the customers in each segment.

Segments should not be confused with status levels. Many companies organize their customers into Gold, Silver and Bronze or similar status levels. That makes sense from the customer's point of view particularly if you provide special services for your Gold group. A couple of years ago I became Platinum on American Airlines. It is wonderful! I get bonus miles, a special toll free number for the Platinum members, and whenever a flight is cancelled, for example, Platinum members have first come for vacant seats on the next flight.

But while status levels are great for recognizing your best customers, these levels are not particularly useful for marketing purposes. For a while American sent me weekly notices about available inexpensive flights from Chicago to Los Angeles or from Dallas to San Francisco. These were of no interest to me, since I live in Fort Lauderdale. American knows were I live. If they wanted to be relevant they could have sent me those e-mails only when a cheap flight from my home city was available. They didn't. They weren't relevant to me. As a result, I opted out, and I get no promotional messages from American Airlines at all. Too bad for them. If they had done a more selective job, they might have been able to send me offers that I would have responded to.

Instead of status levels, relevance is easier to achieve if you can put customers into purchasing or lifestyle segments. Once you have put your customers into segments, it is easier to think up messages that will be more relevant to them. It is not difficult to differentiate the messages that you could send to affluent retired people from those you might send to young singles or families with kids.

How can you create these segments? There are three methods, all of which can and should be used.

Demographics: Append to your customer database information on age, income, presence of children, dwelling type, length of residence and a few more other facts. Using demographics it is fairly easy to classify your customers into meaningful segments. The demographics can be obtained from companies like KnowledgeBase Marketing, which has AmeriLINK« - a file of data about just about every consumer in America with about 100 different fields of data for each consumer. For business customers you can append information from D&B.

Purchase History. The best clue to what is relevant to customers is past purchase history. Keep all their past purchases in your database, and classify them by department (tools, clothes, baby products) and by price (full price, or on sale items). One of the biggest mistakes that e-mail marketers make is to assume that everyone is interested in bargains. Some people are, of course. But others want to know about the latest gadget. Look at the national excitement over the iPhone! At $599 no one considers this a bargain.

Preference surveys. One of the best ways to achieve relevance is to get inside the head of your customers to know what they are thinking. Sears has done a remarkably good job of this by asking appliance purchasers just two questions:

How I feel about brands:

1) I typically buy top of the line name brand products.

2) I buy name brand products at a moderate price

3) I am always looking for a bargain. I will try any brand if the price is right.

How I feel about technology:

1) I buy products with the latest features and innovations

2) I buy products with mainstream features and technology

3) I am not interested in technology. Keep it simple for me.

These questions are asked on the Web of customers who are buying or have bought appliances. They are absolutely wonderful questions, because they permit meaningful segmentation based on these answers. By knowing the answers to these two questions, you can achieve relevance in e-mail communications to your customers.

If the respondent answered "3" on the first question, your e-mail subject line should highlight a special bargain price for your product. If the answer was a "1" to both questions it would be a mistake to discuss a bargain. You should talk about how new and high tech your product is. Do not present it as being on sale.

Once you have created your segments, you need to create copy, an offer and subject lines that are relevant to each segment. Just to be sure you are doing it correctly, you should set aside a control group of 20,000 or so that just gets your old "one size fits all" promotions. You will soon see the value to you of relevance based on creative segmentation.

Arthur Middleton Hughes is vice president / solutions architect at KnowledgeBase Marketing , Richardson, TX. Reach him at Arthur.hughes@kbm1.com.

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