We Make Marketing Work Better marketing analysis email Email Marketing: Making It Personal Adam Benjamin Vice President & General Manager DoubleClick Email

We Make Marketing Work Better

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Email Marketing: Making It Personal

Adam BenjaminVice President & General ManagerDoubleClick Email Solutions

June 2004

© 2004 DoubleClick Inc. All Rights Reserved.

Marketing’s goal

Right Messageto the

Right Customerat the

Right Time

Maximize customer value

through an ongoing dialogue

based on an understanding of customer needs


Offer Choices

LINKS

Multi-Channel

Creative Copy

When did it get so complicated?

List Selection

ROI ?

CLTV

Subject Lines

Personalization

List Hygiene


Email marketing’s evolution to date

Factor ’96-’98 ’99-’01 ’02-’04

Adoption Dabbling Broad adoption Established

Organization Part of “Web” team

Where does this belong?

Part of marketing

Focus Basics. What’s a bounce?

List growth Revenue targets

Neat Tricks Real-time tracking

HTML, personalization

Dynamic content

Real-Time Messaging

Permission Opt-in/out, SPAM

Opt-in/out,

SPAMOpt-in/out,

SPAM


What are the goals of your email program?

• Understand the email channel as it relates to your business• Example high level goals:

• Drive direct sales• Reduce cost of communications• Create greater customer loyalty and satisfaction

• Where does email fit into your overall marketing and sales strategy

Are you building relationships?

6

Crate & Barrel, a respected leading housewares retailer in the U.S., currently with over 80 stores in 15 major markets nationwide.

• Used DARTmail to promote a retail sales event to drive furniture store traffic and sales.

• Used DARTmail to target customers in their database who lived in zip codes near their furniture.

• Used DARTmail to measure the response of the campaign.

Results • Store sales during the week of the email promotion increased by more than 50% from the previous week.

• The email campaign successfully pushed store traffic for the sale as well as giving customers the opportunity to browse online before visiting stores.

Case Study


Companies use email for a variety of business objectives

What is/are your marketing objective for house lists?

54% 52% 54%

63%

50%54%

0%

20%

40%

60%

80%

Brandawareness

Acquisition Immediatedirect sales

Retention/relationships

Upselling Providing info

Marketing Objective

% of Respondents

House Lists

DoubleClick Marketing Spending Index II, December 2002


Email Strategic Framework


Customer Base

Email Productivity

Delivery Success

Growth Rate, Unsub Rate

Bounce Rate, Block Rate

Open Rate, Click Rate

Conversion Rate

Average Purchase Value

ROI, Revenue per Contact

Registration Design…

ISP Relations…

Segmentation…

Order Process…

Cross-sell Promotions…

Everything below!

Interest Generation

Interest Conversion

Revenue per Action

Strategic Levers Key Measures Tactical Actions

A framework helps clarify objectives


Subject Line A provided a 26% lift in sales

Subject Line A:

“A belated gift from the capital of comfort”

Subject Line B:

“The #1 guilty pleasure of 2002”

Control The Levers - It is better than guessing.And small differences can have a big impact.


Case Study – Proflowers Subject Lines

Subject Line A:

“Last chance to order for Valentine’s Day is this Wednesday, order now”

Subject Line B:

“Only 48 hours to order for guaranteed Valentine Day delivery”

Proflowers tested two subject lines

Subject Line A provided a 23% lift in sales.


What to test? When did it get so complicated???

Format Source of the name Subject line

From line Segmentation Personalization

Promotions Length Creative

Link placementTiming and frequency

Landing page

Geographic Remarketing Model scores


“From” line is most compelling reason to open permission-based emails

• Consumers need to make a connection with sender to open

What most compels you to open a permission-based email?

59.9%

34.9%

63.3%

31.6%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

From Line Subject Line

% of Users

2002

2003

DoubleClick 2003 Consumer Email Study


Email Strategic Framework… Part II


Irrelevant messages damage relationships

Response to Irrelevant Email

55%

37%

22%

12%

Asked to be unsubscribed

Impression of that company/brandsending the message changed for the

worse

Stopped visiting that site altogether

Stopped shopping at that store

Source: Cyber Dialogue

BUT – the reality is that most people learn to ignore you…and increasingly so, complain to their ISP/Sys Admin.


Is sending every email to everyone the right approach?

• If you are taking a campaign view, you might think so.

• “I have a campaign to send. Who should I send it to in order to maximize contribution?”

Campaign 1 Campaign 2 Campaign 3

Customer 1 X X X

Customer 2 X X X

Customer 3 X X X


Is sending every email to everyone the right approach?

• But if you are taking a customer view, probably not.

• “What is the optimal sequence of communications for customer X to maximize his/her long-term value?”

Message 1 Message 2 Message 3

Customer 1 X X X

Customer 2 X X

Customer 3 X X


Migrating from “Blast” to “Real Time”

New Registration

Welcome Message

Customer Anniversary

Thank You and Re-order

Abandoned Shopping Cart

Re-marketing Message

• Automatic messages based on customer events or actionsCampaign mentality Dialogue mentality

• Real-time dialogue with your customers based on specific events: behavioral, time-based, etc.

• High Value - Increased customer loyalty

Service Tips

Event Message


Timely messages are relevant and get results

• Additional examples• “Only 5000 miles to Elite Status!”• Alert of changes in stock portfolio• Over your credit limit• New product available in previously purchased category

• What are the triggers in your business?

• Hard to be timely in a campaign mindset• Events are sporadic• No lead campaign development


Segment(“Who”)

Message(“What”)

Channel(“Where”)

Classify customers to better understand needs.

Vary content to meet segment needs.

Channel of message: mail, email, store, site, etc.

Sequence(“When”)

Timing and sequencing of message delivery.

Customer Contact Levers

A better approach: design a comprehensive customer strategy (where you start can determine where you end)


Email Strategic Framework… Part III


Relevance is driven by customer insight—insight is driven by data

• Now is the time to get your data in order• Is your email database connected with other customer data

sources?• Do you have data quality processes in place?• Do you know when and where an address was added to your

database?• Are you capturing customer promotion history?• Do you have tools and process in place to derive insight from the

data?• Can you act on these insights?

• Breadth, depth and quality of data can be your largest driver of success


Which data drive insight for your business?

Dimensions Example Data

Value $ purchase history

Behavior Purchase patterns, click behavior, service interactions

Needs/Interests Product categories purchased, survey response

Demographic/ Lifestyle

Age, gender, marital status, geography

Competitive Share of customer wallet

Relationship Stage Time since first/last purchase


Current Email Performance Trends


.

DoubleClick Q1 2004 Email Benchmark Data

Source: DoubleClick Internal Benchmark Statistics

Compiled from over 2 billion emails sent through DARTmail in Q1 2004, across hundreds of clients.

Benchmark data should be used as general guidelines - specifics for each company will be the key driver of results.

Metric Definitions:

Open Rate: HTML Opens / (HTML Delivered + Multi-Part Delivered)

Click-through Rate: Total Clicks / Emails Delivered

Unique Click-through Rate: Unique Clicks/ Emails Delivered

Bounce Rate: (Soft Bounces + Hard Bounces) / Emails Sent


Trend line shows improved deliverability with a slight decline in opens and clicks vs. 2003

86.4 86.7 86.5 87.5 88.5 88.2 87.3 88.8

37.6 36.4 39.2 38.8 37.1 36.8 38.2

7.5 8.5 8.0 8.9 8.3 9.2 8.4 8.4

37.3

0

10

20

30

40

50

60

70

80

90

100

Q2 02 Q3 02 Q4 02 Q1 03 Q2 03 Q3 03 Q4 03 Q1 04


Delivery %

Open %

Click %

+1.4%

Q104/Q103 % Change

-2.5%

-5.6%


6.4%8.0%

4.8% 5.2%3.8% 3.2% 3.1% 3.5%

23.6%25.3%

26.8%

22.3%

14.9% 15.5%

19.2%17.6%

15.1% 15.4%14.1%

15.5%

9.3%8.4% 8.4%

9.9%

0%

5%

10%

15%

20%

25%

30%

BusinessProducts

andServices

ConsumerProducts

ConsumerServices

FinancialServices

Travel Retail andCatalog

Publisher -BusinessAudience

Publisher -ConsumerAudience

Bounce rates fall between 3% and 27%


Q1 Bounce Rate Range By Industry Category(Note: Individual company policies affect overall bounce rates)


Most categories see an increase in open rates

31.5

39.2

34.2

40.3

43.5

31.4

42.6

43.2

35.7

39.2

34.1

40.1

47.8

37.5

39.5

45.5

0 10 20 30 40 50 60

Publisher - Consumer

Publisher - Business

Retail & Catalog

Travel

Financial Services

Consumer Services

Consumer Products

Business Products & Services

Q1 04

Q4 03

Q1 Average: 38.2%Q4 Average: 36.8%


+3.8%


Click rates remain stable quarter-on-quarter

8.4

7.3

7.5

7.6

9.2

9.3

10.9

8.9

9.6

7.3

7.1

8.3

11.8

9.3

9.5

6.7

0 2 4 6 8 10 12 14

Publisher - Consumer

Publisher - Business

Retail & Catalog

Travel

Financial Services

Consumer Services

Consumer Products

Business Products & Services

Q1 04

Q4 03

Q1 Average: 8.4%Q4 Average: 8.4%



The average “clicker” clicks 1.6x per email

3.9

6.5 6.1

3.9

5.64.9

4.3

5.9

0

2

4

6

8

10

12

14

BusinessProducts &Services

ConsumerProducts

ConsumerServices

FinancialServices

Travel Retail &Catalog

Publisher -Business

Publisher -Consumer

Total ClickRate

UniqueClick Rate

Average total click-through: 8.4%Average unique click-through: 5.2%


1.62x

1.63x1.70x1.45x1.48x

3.03x1.52x1.46x1.72x

9.69.3

6.7

8.3

7.37.1

9.5

11.8


E-mail productivity remains stable, with slight declines in Q1.

Click-to-Purchase Conversions

4.3%

3.5%

4.9%

3.5%3.9%

3.4%

4.2%

3.3%

2.0%

2.7%

3.5%

4.2%

5.0%

Q202 Q302 Q402 Q103 Q203 Q3 03 Q4 03 Q1 04

Orders per E-mail Delivered

0.25% 0.23%0.29% 0.30% 0.30%

0.24% 0.26%0.22%

0.00%

0.10%

0.20%

0.30%

0.40%

0.50%

0.60%

Q202 Q302 Q402 Q103 Q203 Q303 Q4 03 Q1 04

Source: DoubleClick Internal Benchmark StatisticsNOTE: New to Q3, averages are calculated unweighted


Current Challenge:

Spam and Deliverability


Email marketing has its challenges…

90%

28%

11%6%

89%

42%

13%7%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Unsolicited emails(spam)

Frequency ofpermission-based

emails

Volume fromfriends/colleaguestoo demanding to

keep up with

I do not have anyconcerns

Other

Percent of Respondents

2002

2003

What concerns you about your email inbox?

Source: DoubleClick Consumer Email Study


90% have done something to limit spam

• Unsubscribing most common activity, bulk folders next most common followed by using “report spam” features

What specifically have you done to eliminate or limit the amount of spam that you receive?

69.8%

43.1%36.1%

17.7% 15.9% 13.7%8.6%

4.9%

0%

10%

20%

30%

40%

50%

60%

70%

80%

unsubscribedto whatevercompany issending me

spam

created 'junkemail' or 'bulkmail' folders

used a 'reportspam' functionon my email

program

created anemail address

to use whengiving out mypersonal info

downloaded aspam filtering

software online

created asecondaryemail for

making onlinepurchases

not doneanything toeliminate or

limit theamount of

*Other

Percent of Respondents

DoubleClick 2003 Consumer Email Study


Result: Highly favorable impact for clearly branded message.

Client: Major multi-channel retailer

Analysis: Comparison of the impact of using the company’s brand name in the “from” address before the @ sign as well as in the beginning of the subject line versus no brand name before the @ sign and brand name at end of subject line.

AOL Open Rate: +121%

AOL Click Rate: +69%

AOL Complaint Rate: -79%

DoubleClick Case Study: Impact of company brand name in “from” and “subject” lines for AOL email


CAN-SPAM: Do’s for commercial emails

• Include a working unsubscribe mechanism in your messages

• Honor unsubscribe requests within 10 business days

• Identify commercial email messages as promotions or advertisements

• Don’t need ADV: in the subject line• If recipient gave prior affirmative consent to the receive the

message, you don’t have to identify the commercial email as a promotion

• Include in commercial email messages a valid “physical postal address” for the “sender” (entity whose product is advertised in the email)


Transactional or Relationship Email

Commercial Email WITH Affirmative

Consent

Commercial Email WITHOUT

Affirmative Consent

Clear and Conspicuous

Identification that Message Is an Advertisement

No No Yes

Valid Postal Address No Yes Yes

Unsubscribe Mechanism No Yes Yes

CAN-SPAM requirements for commercial email


We Make Marketing Work Better

plan

execute

analyze

Adam [email protected]

Thank You!

Further questions?

Documents

We Make Marketing Work Better marketing analysis email Email Marketing: Making It Personal Adam Benjamin Vice President & General Manager DoubleClick Email