Regain lost customers by appending
It's no secret that retaining an existing customer costs less than finding a new one. So what do to when a good one - or even a promising lead - is missing?
E-mail append is, depending on whom you ask, an indispensable tool in such situations or a necessary evil. It's the process by which a data management company checks physical addresses against a list of e-mail addresses of consumers who have expressed a desire to be contacted by marketers. It won't find everyone you're looking for, and the addresses acquired by e-mail append should be handled with care, but it can be a simple, cost-effective way of stanching customer attrition.
"There's unquestionably a good and very important place for e-mail append, but you need to go into it understanding what you're getting and what it means to you," says Peg McGregor, a managing director at data and management acquisition company ALC.
Opinions differ on when e-mail append is the appropriate solution. Some say it's best used only when customers who have bought from you have changed their address, and you no longer believe they're receiving your messages. Others say you should use it to find customers who haven't bought from you in a while. And there are those who use it to track down promising leads who simply haven't followed up.
Cold feet, warm lead
"The times that we've proposed it most have been at call-center environments, when someone has expressed interest in a product but along the way got scared and did not purchase," says Leslie Moody, SVP of strategy and enablement at Rapp Collins LA. "That's an ideal situation to do an e-mail append, when you already have a warm lead."
Dan Babb, director of e-mail append services for Walter Karl Interactive, suggests doing an append to find dormant customers, though how long depends on the company.
"Should a company append a customer who hasn't bought in 10 years? It depends," Babb says. "For an auto manufacturer, whose customers only make a purchase every 10 years or so, they may cost effectively go to a seven-, 10-year customer versus a cataloger, whose customers make more frequent purchases."
It's also important to consider your own brand recognition. "A brand-name catalog can have more success digging deeper in its file than, say, Joe's Hot Dog Stand," Babb adds.
Another use is connected to the recent increase in postal rates. Some direct marketers are choosing to drop minimally responsive customers from their physical mailing list, but can use e-mail append to approach them by e-mail, thereby making it a more cost-effective relationship. "You now have a lot of clients with customers who may have made the cut last year but not this year," says Babb. "That's another lost customer for whom using e-mail append is very cost effective."
Once you've decided to use e-mail append for whatever reason, you'll need to decide which kind is right for you: name append or household. If you need to find a specific person, then a name append is the right option. If anyone at a particular address will do, household append is the way to go. "There's value to both, but depending on the business you have and what your relationship is with these people, there may be more value in one or the other," says McGregor.
Both types are available for roughly the same rates. Most firms charge by how many thousands of addresses they can return, and specific rates depend on the volume of your list; the CPM for a million names will naturally be less than for two thousand, for example. For the most part, rates can be as low as 5 cents per thousand names or as high as 25 cents.
But perhaps the most important question to consider when doing an e-mail append is the quality of addresses your vendor is providing. Mainly, are these people who have opted in to receiving marketer solicitations, or simply not opted out. The difference can have a huge impact on your success rate.
"When you work with these companies they generally have a double opt-in policy," says Moody. "That means that the recipient may not know who they're going to hear, from but they have twice said they are OK with receiving e-mail from [marketers].
"If you worked with someone who didn't have that policy in place, you're working with the wrong kind of partner," she adds.
What you do with the addresses once you get them is also vital. "People on your appended list shouldn't be dumped into your house file and get the same e-mail as everyone else," points out Babbs. "They should be treated differently."
First impressions last
It's generally recommended that your first contact with appended targets be a welcoming message that once again gives them the opportunity to opt out. Remind them that they have expressed interest in hearing from you before, and clearly spell out what savings or benefit you can bring them by e-mail. But make it simple for them to decline.
"Help them understand that you're not going to abuse them and e-mail them three times a week, and that you have something of value to offer them," says McGregor.
Of course, e-mail append isn't the only way to find lost customers, it's simply the most common and most proven.
"These days, there are a number of options for finding lost customers," says Jeanniey Mullen, senior partner, worldwide e-mail marketing at OgilvyOne, by e-mail. "Integrating opt-in into media is one, landing page opt-in is another, social networks are a third. The difference between these and e-mail appends is that they require the customer to activate them. E-mail appends do not."
The important thing to remember with e-mail append is that you are buying the e-mail addresses of people who did not give them to you. They may have given a general OK to a list management company, and they may even have once done business with you. So it's best to tread lightly. Or, as Mullen warns, "The perception these days is that if a person does not remember requesting an e-mail from you, it is spam."