Case Study Webinar: How an online retailer increased customer lifetime value 416% by using automated emails

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@realhearandplay • @DanielBurstein

Sponsored by:

Oct. 24, 2012

Panel Presenters

Daniel Burstein
Director, Editorial Content
MECLABS
@DanielBurstein

Jermaine Griggs
Founder
Hear and Play Music, Inc.
@realhearandplay

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MarketingSherpa is a research and publishing
organization serving the marketing community

• MarketingSherpa’s annual
research cycle provides
knowledge for continuous
marketing improvement

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Research Background
• We surveyed over 3,000 marketers focused
on lead generation to uncover:
• Top challenges
• Best marketing tactics
• Lead scoring, nurturing and management
• Content strategies
• Marketing automation
• Marketing analysis
• Marketing operations and metrics

• Result of this research – MarketingSherpa’s FUEL methodology to power
marketing effectiveness from lead generation to sales conversion

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What's best way to address “automated emails are off-
brand” perception at upper management? – Justine
"We just key in those product numbers and product
descriptions, and then it is going to populate an
automatic email," Daphne Chen, Senior Manager, Email
Marketing, Newegg. "We are really quite automatic in
this part, and we don't spend a lot of labor to do the
Shell Shocker daily alert email every day.“

Results
• 60% average open rate
• 6% average CTR

Source: http://www.marketingsherpa.com/article/how-
to/why-neweggs-dailydeal-alert-emails

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Please indicate the level of EFFECTIVENESS for each of the email
engagement and relevancy tactics your organization employs.

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Poll: What type of automated, event-triggered, lifecycle email messages does
your organization deploy?

• Welcome • Date Triggered
• Thank you • Reengagement
• Transaction • Event countdown
• Post-purchase • Website behavior triggers
• Upsell • Cart abandonment
• Activation

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What type of automated, event-triggered, lifecycle
email messages does your organization deploy?

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Who I Am (The Quick Version)

• Grew up in Long Beach, CA
• Started Hearandplay.com in 2000 with $70
• By 19, we grew to mid-six figure business
• By 21, surpassed seven figures
• Today, our total sales exceed eight figures
• Having bootstrapped, I attribute much of success to
automated and personal e-mail marketing
(relationship with customers).

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“Automated” & “Personal” in
the same sentence…

An oxymoron?

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In This Presentation
• Why the words “Automated” and “Personalized” are
not contradictory, and…

• How to achieve both by utilizing demographic and
psychographic data collected to customize user
experience (message  market match), which…

• Improve conversions, lowers opt-outs, and increases
customer retention / ltv.

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For These Slides & Free 26-pg Report,
“How To Harness The Power Of
Automation To Make More While
Working Less”

Visit:
www.AutomationClinic.com/ms

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Marketing Automation

“The Process Of
Scaling Personal
Attention”

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“Marketing Automation has been
called the most transformative
advancement in sales and marketing
since the advent of CRM (Customer
Relationship Management)”

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Case Study: ME
500
450
• Focusing on 400
350
automated, personalized e-mail 300
250 LTV
marketing increased my 200
150
lifetime customer value by 100
50
416% in 14 months (from $90 0
2007 2008 2009 2010 2011
to $375+)

• Avg global clickthrough rate of
41.28%
Today:

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Marketing Automation
“How It Works”

• Relies on collecting lots of data (always be
collecting data!)

• Uses data to segment prospects & customers to
deliver personal experiences a human could
NEVER manage.

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Before After
•We asked for skill level and favorite •Ask the same questions but actually
style on opt-in form started USING THE DATA

•Same follow up to all users with •Users are segmented & receive
“personalized” fields (i.e. – “learning authentic e-mails based on style,
*jazz+ piano”) skill level, and behavior
(clicks/purchases/time on page)

•There was a set-in-stone schedule •Everything is conditional and based
of follow up e-mails on user behavior. One
e-mail may trigger another, and
another.

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Before After
•Used a “one-to-many” broadcast •Use conversational tone & reference
tone because we had no choice past actions taken (e.g. - “Bob, I noticed
you checked out my last gospel lesson on
traditional hymns”)

•Once in our system, no additional •Every action taken results in a tag
data was used to alter future added to their profile, which can be
communications (static follow-up) used as a condition in future
automated e-mails (dynamic)

•Once the sequence was over, it was •Like quantum physics, packets of
over possibilities exist based on
accumulated profile data (promotions
can be repeated for those who didn’t click or
buy, new promotions started, etc.)

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Data Collection

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Before After
•Had no way to gauge how •Using lead scoring & attaching points
responsive a prospect was to each action (click, view, time on
page, purchase), distinguishes hot
from cold leads/customers.

•Offers were sent at arbitrary •Offers are sent when prospects pass
intervals (based on generic research certain thresholds (lead score, “x of
but not tailored to prospect’s last y” messages clicked, avg buying
receptivity) cycle period exceeded, etc.)

•Prospects had no control over what •With the insertion of a simple
messages they received trackable link, prospects can be asked
to click if they have interest in
receiving further details on the subject
matter (or even yes vs no links)
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An Automated Sequence With 171 Steps

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171 Steps? Are You Crazy?
• No
• Segmentation: Not all prospects will receive all 171
steps in 365 days. The steps act as “possibilities.”

• Some steps are genre-specific
• Some steps are behavior-specific
• Some steps are holiday/anniversary-driven
• Some steps are cyclical
• Some steps utilize multimedia

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Scaling Personal Attention

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Example: Beginner Gospel Musician
• Opt-in with first name, e-mail, beginner (skill), gospel (style)

• Receive gospel-related communications (with colloquial language to
build rapport)

• Every e-mail clicked, video watched, & minutes stayed on page
result in points added to their lead score (which affects frequency)

• As they watch lesson samples sent via e-mail, 2-question surveys
collect further data that be used in future.

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• Time on page & video usage stats as conditions in future
communications to ask user how they enjoyed the lesson and even
offer a follow up lesson.

• If desired action wasn’t taken, benefits of CTA can be
re-emphasized

• Weeks later, follow-up steps can reference past similar actions
taken to further current desired actions (e.g. – “This video is similar
to the one you watched a few weeks ago.”).

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• Evergreen newsletters / e-mails can be used & recycled at later times
based on usage data.

• Anniversaries are acknowledged (e.g. – “It’s been six months since you
first committed to learn gospel music on the piano”).

• Soft offers are generally presented under content or as an aside early on
(“P.S.”).

• Hard offers are presented once user has passed lead score thresholds, has
clicked certain # of links, has requested front end offer, has raised their
hand by clicking previous links, and a number of combinations thereof.

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Taking It A Step Further: Adding Human Touch

• Incorporating multimedia
channels.
• Adding personalized (and even
generic) audio messages to
various e-mail follow up.
• Voice broadcasting to emphasize a
particular e-mail sent or campaign
started.
• Sending birthday cards.
• Offline personalized postcards.

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Taking It A Step Further: Adding Human Touch

• SMS “Tip of the Week” – Mobile Music Minutes

• Starbucks gift cards and cookies (customers who pass various
monetary thresholds)

• Incorporating direct mail (catalogs, direct mail offers sent
once various e-mail thresholds have been met)

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Package Stickers
Mobile E-mail
(Pre-recorded Msg)

Free CD Offer Newsletter
(Direct Mail)

Catalog
Postcard

Letters
Birthday Card

Personalized
Cookies & Gifts Internet Audio
Personal
Voice Broadcasts

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Upselling & Cross-selling
• All upselling and cross-selling is based on data in their profile

• During & after purchase, user is shown offer based on hierarchy: what
they just bought, what they’ve already bought, and what they’ve
proven to be interested in (based on tags/data in record), and current
customer value.

• Global Upsale Rate: 33.8%

• Follow-up backend selling utilizes RFM analysis: Recency, Frequency,
Monetary.

• Average customer now comes back 9.14 times

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Market leaders including American Express, LinkedIn, HP, and
hundreds more rely on Eloqua to ensure every component of
their marketing works harder.

Eloqua provides Modern Marketers with the
Expertise, Education and Technology needed to help
drive revenue

• The most powerful marketing automation platform
available
• Dedicated modern marketing expertise and services
• Comprehensive education and training to maximize
your investment

Our goal is to help our customers become the
fastest growing companies in their categories.
For more information visit www.eloqua.com call 866-327-8764 or email demand@eloqua.com

Wrapping It Up: Action Steps
• Collect key pieces of data to get the conversation
started

• Use CRM that will allow you to continually add and act
upon data and tags in user records

• Build out different paths within the sequence for your
most active users to follow (course correction for others)

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• Every link or action taken should be tracked with CRM
system. Use data to keep conversational tone.

• Implement an internal “scoring” system that
distinguishes your hottest prospects and customers
from the rest.

• Don’t be afraid to have 5 “almost” duplicate steps that
cater to the exact needs of different segments vs one-
size-fits-all.

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• Incorporate other marketing channels & multimedia
elements: direct mail campaigns, personalized audio,
video, post cards, birthday cards, gift cards… especially to
hyper-responders.

• Use behavior data to cross-sell based on last purchases,
last pages visited, time on page ranking, lead score, etc.

• Remember: Don’t be afraid to use a personal,
conversational tone… even in B-to-B. “Companies are
People.”
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Thank You!

Daniel Burstein
Director, Editorial Content
MECLABS
@DanielBurstein

Jermaine Griggs
Founder
Hear and Play Music, Inc.
@realhearandplay

#sherpawebinar

Case Study Webinar: How an online retailer increased customer lifetime value 416% by using automated emails

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