Attracting and retaining customers for an eCommerce business is an area most SMB merchants will spend more of their time conducting and perfecting than any other area of their business. And for good reason. If you don’t have customers, you don’t have sales. If you don’t have sales, you don’t have a profitable online business.

This is the sixth post in a new series by eCommerce expert, Bret Williams. Marketing an online selling business is a complex and involved subject. In this installment, part 1 of 3, we discuss email marketing to build a loyal customer base.

ECommerce marketing is a very involved subject. Like our clients, we spend more of our time working with clients to build and manage competitive marketing efforts. We know all too well how complex a strong, producing marketing effort can be. Therefore, in order to provide sufficient insights to all the various components of an SMB marketing operation, I’ve divided the Marketing portion of this Master’s Series into three parts: email, social and advertising. In the final installment, we’ll also cover search engine optimization.

Marketing Builds Success

Before we get into the nuts and bolts of list-building, let’s talk about why you want to build a list of potential and actual customers. The former — potential customers — we’ll refer to as subscribers, whereas we’ll refer to customers as those who have made at least one purchase from your online store. Just so we’re on the same page in terms of nomenclature.

At some point in the future, you may want to sell your online business. After all the long hours, careful planning and aggressive execution, you may want to “cash in” on your efforts. We’ve done that before: built an online business and sold it at a multiple of the gross profit. But the value of your business is more than just the gross profit. Potential buyers will value your business more if they feel there’s a well-maintained trove of subscribers and customers from whom future sales may be derived. After all, selling to those who are already aware of your store is much less expensive (as you’ll see in this series) than advertising to attract new visitors.

Likewise, you’ll be more profitable per sale if you gain sales from those who have already expressed an interest in your offerings.

Yet, most merchants who we review either don’t appreciate the value of a good subscriber list or underperform in their efforts to sell to subscribers and customers. It’s not necessarily their fault, though. Creative marketing takes talent and experience to be successful. Effective marketing involves a lot of different disciplines, including strategy, design, copywriting, psychology, interactive, research, analytics, demographics and more. For many, marketing is beyond their own native capabilities.

The good news is that there are some basic marketing efforts any SMB merchant can undertake. You might still need to employ assistance in some of the disciplines noted above, but as long as you understand the tactics and focus on the most productive marketing avenues, you should see a bottom line increase in your business.

Email Marketing

I will begin our discussion on marketing with what is perhaps the least expensive form of marketing: email. Social media, of course, is free, but the labor costs involved in constantly monitoring and posting to social media certainly outstrips the cost of managing a well-planned email marketing system.

There are lots of tools available for building and managing email marketing campaigns. We’ve tried many of them and the one we like the best — or at least is the one with which we feel most comfortable — is MailChimp. The company is certainly a leader in this field, and I’ve been pleased with their continued innovation and expansion of services. Plus, it’s really quite affordable.

But, before you jump into MailChimp, allow me to impart some insights that can help save you some time and frustration (we’ll explore each of these within this post):

  • Build one subscriber list. We’ve had new clients come to us who had built subscriber lists for different types of customers. One new client has over 20 email lists for the same store. This made building newsletter campaigns much more complicated and eliminated the ability to build cross-segment lists for targeted emails.
  • Use groups for major customer categories. Within the same list, you can create groups to both assign subscribers and to allow subscribers to request information pertaining to certain categories.
  • Learn how to dynamically segment your list. With MailChimp segments, you can create very specific customer profiles to whom you can deliver carefully tailored messages.
  • Use social profiling to identify influencers. In Part II of this topic, we’ll explore influencers more, but with MailChimp’s social profiling feature, you can identify your most active social media customers.
  • Use transactional emails to communicate to non-subscribing customers. This is a rather new and very under-realized feature of MailChimp, and certainly worthy of more discussion.

Let me take just a moment to further differentiate subscribers from customers, at least in terms of MailChimp. By configuring the integration of your eCommerce platform with MailChimp, both those who actively subscribe to your list and customers who buy from you — whether or not they also subscribe to your list — can be added to your list. MailChimp allows you to send email campaigns to those on your list who subscribe, but not to customers who have not subscribed. However, you can send what are called transactional emails to non-subscribing customers. These transactional emails can be after-purchase emails or solicitations for previous customers to return and shop again in your store. Of course, with each of these, you can also encourage customers to subscribe to your newsletter emails. In short, just because a customer does not subscribe to receive your marketing emails, they can be aggressively marketed using the transactional email feature!

Building a Subscriber List

How many times have you visited an online store and been hit immediately by a pop-up asking you to subscribe in return for a discount? And how many times have you given up your email address on these? If you’re like me, you’re very unlikely to subscribe before you’ve even gotten a chance to see if you like what the store sells. This methodology is intrusive and rarely secures subscribers who end up shopping with you. You want customers who like what you have to offer. You want customers who have spent some time shopping on your store. You want customers who are closer to making a purchasing decision. Why give up an immediate discount until you have an interested buyer?

The better approach is to construct a list-building effort that encourages purchases by carefully timing pop-ups and other enticements. In the least case, such a pop-up should not appear until the customer has looked at more than your home page and spent a certain amount of time shopping on your store.

You should also ask for subscribers during the check-out process.

The key to enticing subscribers to sign up is not as much for immediate gratification — although that can certainly be an attractive proposition — but the promise of access to savings, discounts and/or new products in the future. You should strive to build a sense of “elite-ness” to your list: that by joining your list, subscribers are part of a select, inside group.

Consider giving away something besides a discount. For instance, if you’re willing to give new customers a 10% discount on a first purchase of $100 or more, think about giving them a free gift that costs you $10 with their first purchase. Discounts are intangible; an actual free gift is tangible. Few people want to miss out on receiving a free item. Once a visitor purchases, even if they don’t subscribe to receive your newsletters, you can still use the transactional emails of MailChimp to follow-up on their sales, recommend additional products, and remind them in the future to return and shop again.

Building Productive Email Campaigns

Now that you have a growing list of interested consumers, you don’t want to squander this asset. There’s a lot of debate about how often you should email those on your list. Determining how often to email your audience depends on several factors:

  • How often does the average customer shop with you? We shop at Costco at least once a month. I drink a lot of coffee, and I like their locally sourced coffee beans, as well as their New York Strip steaks and frozen, organic broccoli. Most Costco customers shop at Costco two or more times each month, and the merchandise changes often. Therefore, it’s not surprising that I receive emails from Costco about every 2-3 days. I don’t read them all, but I do catch myself scanning the long list of available items to see if there’s anything new that draws my attention. On the other hand, Discount Tire, where we buy our tires, knows that we buy tires about every 2-3 years. Their emails are much less frequent. The point is, the more often customers shop with you, the more often you should email them, as it’s quite possible they’re also shopping frequently with your competitors. You need to keep your brand in their mind without being a burden.
  • Do your product offerings/prices change? Do you have regular, seasonal sales? Do you have new products added to your store from time-to-time? Outside of a regular schedule, your emails should be timed to promote special events or arrivals. Use a series of emails to build up to the sale date, making future emails important, as well. Even if a customer doesn’t find today’s sale attractive, if you do your strategy right, your customers will not want to miss out on a future offering that might be more to their tastes.
  • Can you provide advice or tips on using your products? You can really build value in your brand by helping your customers enjoy their products more. It’s part of being the niche expert we discussed earlier in this series. Do you sell motorcycle parts? Then offer maintenance tips for your subscribers. Sell exercise equipment? Build a subscriber list specific for those who want a weekly workout regimen. The more you assist your customers, the higher your brand reputation will be.

Segmentation

We use MailChimp to help us derive customer segments based on whatever data we can gather from our clients’ subscribers and customers. With the social profiling feature of MailChimp, we can segment customers based on their social media activity. We can segment by geography, age, gender, and how much of a social influencer they are. For customers in the list, we can segment by purchasing habits, products purchased, average order amount, number of purchases and more.

In short, we can specifically tailor campaigns based on very granular data on customers. This gives our clients tremendous power to deliver timed messages and campaigns aimed at high-performing segments.

Abandoned Cart Emails

Almost all popular email platforms have some form of system for sending emails to visitors who add products to a cart, begin the checkout process, then leave before completing their purchase. Unfortunately, these native features are usually very, very basic and most only send out one follow-up email.

Before I outline how to construct an effective campaign for enticing customers to return and complete their order — and before you get too excited about increasing sales from abandoned carts — let’s settle on a few realities:

  • The conversion rate for abandoned cart campaigns is very low. Compared to your overall site conversion rate (the percentage of visitors to your site who end up completing a purchase), the percentage of customers who abandon a shopping cart and return to complete their order is much lower — usually a fraction of your overall site conversion rate. People leave carts on sites for a variety of reasons.
  • In order to send an abandoned cart email, you have to have an email address. Usually, a customer on your site doesn’t actually enter an email address until they begin the checkout process. Some platforms don’t even ask for this until the second or third step in the checkout process (ugh!). Until you can get an email address from a customer, you have no opportunity to send them a follow-up email. [This is why this type of email should be called an Abandoned Checkout email instead of Abandoned Cart. Without the email address offered during checkout, you cannot send an email.]
  • You should focus on reducing your abandonment rate. While it’s good practice to construct a top-notch abandoned cart follow-up campaign, it would be better for you if customers didn’t abandon their carts in the first place! Analyze how people interact with your site (there are a variety of tools to help with this). Try to discover why they abandon. It could be that they don’t think you’re trustworthy — they need more convincing that you’re a legitimate merchant. Your checkout process might be too cumbersome. Or, you are not offering a payment method they prefer. Just remember: the more you do to keep the customer on your site and completing their order, the more you eliminate the possibility that they’re going to buy somewhere else.
  • Try to stop the abandonment when it happens. By that, I mean use a tool that will know when a customer is leaving the cart or checkout page, and offer them an immediate discount or other enticement to complete the sale. We use OptinMonster’s Exit Intent feature to offer leaving customers a special discount, but only from the cart or checkout page of the site. After all, these are customers who are just a whisker away from completing a sale.

There’s always a lot of discussion on various forums about how quickly the first follow-up email should be sent and how many should follow. While we’re still compiling data by doing variant testing on this, I do subscribe to the following general outline for constructing a follow-up abandoned cart email campaign:

  • Your first follow-up should go out within 1 hour. Man, that sound quick, eh? Yes, but the fact is that your customer may have left your online store in order to shop around with others. And, if you’re like me, the more you surf the web, the farther you get away from previous sites you have visited. If your customer can’t easily remember the name of your store, they may not even know how to return to it (how many people really understand browser history?). This first email should be simply “We saved your cart for you. We know you may want to take a moment to consider completing your order, so we went ahead and saved it in case you want to come back and complete the purchase. By the way, did you know we have a 100% Money-Back Guarantee?” Don’t be afraid to enumerate your brand value.
  • Send your customers other products to consider. The second email that goes out should contain related products — items you sell that are similar to the ones in their shopping cart. Maybe they decided they didn’t want the items they put in their cart, but didn’t find the other similar products you offer. I get these types of emails all the time from Amazon. It does help to show me products I didn’t inspect the first time I looked on their site. I usually like to see the second email go out 24 hours later.
  • Offer an enticement with the third follow-up email. If the customer has not completed their purchase within 72 hours of abandoning your site, then it may be time to offer up a discount, gift or free shipping if they’ll go ahead and complete their order. Consider including a countdown timer in the email adding a sense of urgency to your message.

Don’t Give Email the Brush-off

Email marketing can be one of your most rewarding and converting marketing tools. But don’t be sidetracked by various tools and add-ons that make it seem easy. Nothing that qualifies as the best is easy. Not that emails should be difficult with the right tools. The challenge comes in taking the time and effort to set it all up, creating engaging designs and copy, studying the data generated, and testing and re-testing to find the “sweet spot” of success.

Given the low, low cost of sending emails, though, the ROI (return on investment) can be quite significant.

Stay Informed.

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Bret Williams

Bret is the a co-founder and the Managing Partner of novusweb®. He is also author of several books on Magento and e-commerce and is sought as a speaker and trainer. Bret has been crafting internet innovations since 1995.