Use behavioral targeting to pump up your e-mail ROI

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Ready to climb the peak of e-mail optimization? From an ROI perspective, e-mail marketing can be more effective than search in increasing conversion rates, especially if you have the right tools and techniques.

Consider those annoying renewal notices you might get in the mail from your favorite magazines. Next time you receive one, look closely to find your customer tracking ID. Magazines generally use unique customer IDs in their subscription models to track the source and progression of customers in their buying lifecycle. This same strategy can be easily applied towards creating a successful e-mail marketing campaign. Start by taking a look at your internal e-mail database and make sure that each customer has a unique ID. These ID tags allow you to analyze, target and personalize your campaigns, a key factor in behavior targeting.

After setting up your e-mail database with customer ID tags, you can start segmenting. Begin by placing your customers into buckets based on similarities such as geographic location or purchasing patterns. By segmenting your list, you can target your e-mails based on customer demographics and behavior. Use these buckets to create a model for your next e-mail campaign, as they can help predict which customers will buy certain types of products at particular times.

Once your list is segmented, send each group a multistep e-mail campaign with a promotional message on the product they are most likely to purchase. Consumers often need to see the same message multiple times before they act. E-Loan recently garnered 13% more purchases as a result of a three-part e-mail promotion strategy, as opposed to sending only one promotion and moving onto the next special.

Take your behavior-targeted e-mail campaign even further by personalizing and optimizing the entire e-mail and Web site experience with statistical modeling. The same ID tags which helped you create segmented buckets can trigger A/B and multivariate tests that assist in further optimizing your targeting and personalization, and integrate your e-mail service provider with your Web site optimization service provider. By testing and optimizing your e-mail campaign, you can effectively reach out using sophisticated statistical recipes that work both through e-mail and on your Web site, and push consumers towards their next purchase.

The end result? Optimization through effective statistical modeling can revolutionize your e-mail marketing channel from the top of the funnel to the bottom and hit your bottom line in exactly the right place.

Siara Nazir is director of customer acquisition and retention at E-Loan. Reach her at siaran@eloan.com.

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