With your 2013 strategies now fully in play, it’s important that we take a look at email analytics from this past holiday season to understand whether there are indications that adjustments to your strategies might be necessary. At DEG we strongly recommend that marketers continually look to statistical indications from ongoing campaigns for hints as to how they might be amended to increase their impact, as well as to recently concluded campaigns for takeaways regarding new opportunities.
To assist in this process, we sought to better understand trends from this holiday season at a meta level. DEG’s Analytics and Insights team went through the process of aggregating some of our Digital Direct clients’ data specific to assess how we might optimize their effectiveness during 2013’s holiday season.
First, some housekeeping: To diffuse the data and keep it from being skewed by certain organizations in terms of higher order values, higher-frequency campaigns, or larger distribution lists, we normalized the data and used indices for comparative purposes. An index of 100 is the average. An index less than 100 would represent a lower-than-average metric and one greater than 100 would represent a higher-than-average metric. We selected national and large regional retail clients and also provided success metrics for the subset of retailers with non-durable-goods (NDG Retailers).
To no great surprise, the retailers in our study increased the volume of email in November and December, coinciding with the holiday season. Further, the spike in revenue in November was also expected with the Black Friday/Cyber Monday weekend. What is interesting is the discrepancy of the volume of email and the revenue generated from those emails. Volume of email increased dramatically in November and then again in December. Yet revenue dropped below an index of 100 in December for the non-durable goods retailers.
Other comparisons are also useful to investigate. One may expect that open rate would decrease with higher volume during the last two months of the year due to consumer fatigue, but that wasn’t the case. Open rate stayed consistent – ranging from indices of 95 to 107 for the segments over the entire time period. Retailers hope that those who open the emails click-through at an even stronger rate as the holidays approached. The click-to-open-rate (CTOR) saw peaks in both August and November and saw lower marks in October and December. That drop was caused by a big drop in click-through rate. Consumers opened the emails in December, but the offers or the products were not compelling enough to get them to click-through to the website.
We should probably note, too, that there is significant inbox “window shopping” that occurs during the holiday season. More than at any other time of the year, during the holidays, email is used as a window in to the store, and the click is equivalent to stepping foot inside. The open may be as easy – or even easier – to earn in this time period due to increased “browsing,” but the click-through can be much harder to earn based on the sheer number of emails (or store windows) in the inbox. It is really the only time of the year that an email from Rockport, for example, is directly competing for attention (and wallet) with Best Buy, as a nice pair of shoes and an iPod touch might both be viable gift options for the same friend or relative.
Compared to the other metrics we’ve already reviewed, Average Order Value (AOV) varied more erratically over the six month timeframe. Likely in line with the Black Friday/Cyber Monday specials, AOV dropped in November but rose again in December.
As you plan
So what do we make of all this? Should you stop doing holiday email campaigns? Of course not. Email continues to be a significant driver of revenue throughout the holiday season.
What the data tells us is this: Smart marketers should take a look at the metrics for all of your campaigns over the past several months. Carefully consider the effectiveness of the emails you sent and what behavior they inspired in your customer base. Re-evaluate the cadence of your holiday planning and decide if you should ramp up your holiday campaigns earlier than you did in 2012 (keeping in mind that Thanksgiving was particularly early last year – 11/22 and it will be particularly late – 11/28 – in 2013).
To make the best use of your marketing dollar, watch the Revenue Per Email (RPE), alongside other metrics. And to increase conversion rates in previously lower CTOR months, evaluate your strategies and adapt your campaigns to nurture your subscribers toward the goal of completing a holiday transaction.
The clearest advice I can give you is this: A successful holiday campaign is not an isolated event. It is the culmination of an annual strategy that is relevant to the recipient, has an appropriate cadence, and builds trust and confidence in your product and brand.
So as you plan your 2013 holiday success, remember that it begins right now. Tailor your strategies appropriately and you’ll have a great story to tell come 2014.