By Guy Hanson, VP of customer engagement, Validity
This year has been an incredibly difficult time for all businesses, but the traditional retail sector has especially been hit hard by the impact of the global pandemic. From physical stores being forced to close during lockdown, to issues with supply chains and the UK entering another recession, retailers have had their fair share of challenges to battle lately.
The industry has had to make a number of changes to its business processes, including their marketing programmes, to keep up with the changing guidelines to lockdown and the financial climate. With most people feeling the pinch in some way or another due to the unstable economy, retailers need to be sensitive towards the difficult situation their customers may be in while still being focused on generating revenue for the business interest.
New Validity research has shown that retailers have been able to take advantage of particular marketing channels most suited for customer communications, like email, to balance their marketing messages to show compassion and empathy while still promoting online products and services. So, what makes the role of email essential for business development in a post-COVID world?
Email’s ability to boost engagement
Time and time again, email has proven itself to be the one of the best marketing channels for boosting customer engagement and the global pandemic has been no exception. Savvy marketers will know from the DMA’s latest Consumer Email Tracker report that consumers prefer email for customer services communications, discounts, offers and sales notifications, order confirmations and updates. This is further backed up by a US survey which found that 50% of consumers prefer to communicate with brands via email rather than social media, direct mail, or mobile apps.
This preference existed before the pandemic, but Validity’s recent research, conducted over April and May this year, found that even during the strictest period of lockdown, email correspondence was still the favoured marketing channel among consumers as it drove 16% of all visits to UK retailers’ websites, an increase of 18% compared to April and May 2019.
Not only is email great for retailers to attract customers onto their websites in lockdown, but compared to other marketing channels – such as social, direct, organic search, paid search, and display and referral – visitors through email are also far more engaged and more likely to return. The research found that across Europe, email visitors viewed on average 5.8 pages on the site before leaving, compared to 4.7 pages for the other channels. Additionally, nearly three quarters of site visitors from email return to the site, whereas only half return with all other channels.
Despite social media being hugely popular, and perhaps for some even addictive, email marketing is the clear front runner when it comes to communicating, building relationships and encouraging sales with its markedly bigger influence in driving consumers to the website and keeping them there for longer. Certainly, this is an all-important factor for converting a browser into a potential buyer and a clear example of why email marketing is vital for business development in our post-COVID world.
Email’s high value
It is to be expected that with the UK now in recession, businesses will need to be fiscally prudent over the coming months. Marketing budgets will be evaluated and re-evaluated, but fortunately for retailers and other industries alike, email marketing is not only great for generating engagement, it is also hugely cost-effective.
The DMA Marketing Email Tracker 2020 report found that email’s return on investment (ROI) is now at £35.41 for every £1 spent. In the face of contracting budgets, the value of email is undisputable, and this is where businesses should be focusing their marketing spend.
The same Validity research investigated what the benefit would be should retail companies increase their spending in each marketing channel, and again, email comes out on top. If retailers were to spend just 1% more of the marketing budget on email, they would gain 4.1% uplift in site visits, but for paid, social and display marketing, they would get less than 1% uplift. In fact, if budgets were to be split evenly across all marketing channels, email would provide seven times more visits than paid search, 11 times more than social, and an impressive 23 times more than display.
We cannot discuss all the ways in which email is advantageous for retailers during this difficult time without highlighting where businesses can go wrong and end up doing more harm than good. Through Validity’s analysis of major mailbox providers (MBPs) at the start of the pandemic, spam trap hits rose sharply which could be an indicator of some companies feeling the need to communicate with all their customers, as well as perhaps offsetting the balance of demonstrating empathy with flagrant product promotion instead.
Although over the last few weeks, spam trap hits have been declining, retailers will want to avoid spam traps as much as possible. MBPs and filtering companies monitor them so if spam trap hits rise, email deliverability and sender reputation will be negatively impacted.
It is important that companies do not become too eager with their communications and flood the consumer’s inbox unnecessarily as this can annoy subscribers. Being able to tailor communications intelligently and with sensitivity is also key, and this is where having high quality data is crucial. Poor data leads to poor targeting and personalisation and failure to deliver the right message to consumers can result in them quickly marking an email as ‘spam’ or unsubscribing altogether.
There is also the challenge for the retail industry posed by new subscribers who have been traditionally offline, but who have been forced online by the lockdown. The needs and interests of these digital immigrants are likely to very different to those of digital natives. Senders will need to consider different messaging and promotional strategies for these new subscribers to maintain engagement and ensure they do not quickly churn. If retail companies have not taken the initiative already, now would be an excellent time to ensure all data on file is cleansed so they can nail targeting and personalisation for the post-COVID world.
The retail industry has relied heavily on email to connect with the British public during this time. The evidence of email’s ability to help retailers navigate the global pandemic is apparent, but companies should understand that it is not just down to email marketing alone. The current climate also demands compassion and understanding that is authentic and credible.
If there is a perception that a company is trying to profit from the situation, it could provoke a negative backlash whereby subscribers respond more negatively to emails (for example, higher complaint rates). A company’s insincerity could even filter out onto social media and into the press, so it is crucial that retailers continue to act with authenticity and sensitively tailor their email communications as the UK comes out of lockdown and we try to return to ‘normal’ life.