Inactive Email Subscribers: Tips for Taming the Beast Inactive email customers and subscribers are potentially the largest pain in the posterior of many digital marketers today. However your organization defines "inactives," they often can comprise one-third to one-half of your database. These unengaged subscribers are costing you significant resources: money, time, potentially inbox deliverability and, most importantly, revenue. In this Webinar, Carey Marston, email marketing manager with SmartPak, presents a case study on how they've attacked the non-engaged challenge' and Silverpop's vice president of industry relations Loren McDonald covers several aspects and ideas for dealing with the inactivity beast, including: Defining what is an "inactive" Determining root causes of non-engagement Steps to minimize inactivity "Activating" never-engaged subscribers earlier in the process Segmenting types of inactives Reactivation tactics and programs When/whether to suppress inactives

1. Inactive Email Subscribers:
Tips for Taming the Beast
#SPOPWebinar

2. Speakers
• Carey Marston
• SmartPak
• Email Marketing Manager
• Cmarston@smartpak.com
• Loren McDonald
• Silverpop
• VP, Industry Relations
• Twitter: @LorenMcDonald
• Google+: +LorenMcDonald

3. Agenda
Framing the Challenge
SmartPak Overview
Action Plan
Summary/
Q&A

4. Framing Today’s Topic

5. Remove your
inactives; Send
less email!
Don’t remove
your inactives;
Send more
email!
The Inactives Debate

6. “Inactives” are about
human behavior…
not deliverability.

7. Goal for this Webinar…
Get you to think a little
differently about inactives…

8. 1. Reactivate early
2. Automate/Programs
3. Focus on mimimization

9. Why Do You Care About Inactives?

10. Inactives Are a HUGE Issue

11. Typical Actives vs. Inactives Ratio

12. Impact of Inactives
Lost potential revenue
Inefficiencies/Reduced ROI
Fuzzy metrics
Potential reduced deliverability

13. Retailer X Inactives Challenge
450,000 Subscribers
40%-50% Inactive (no opens
+ clicks for 12 months)
200K-250K non-responders

14. Hypothetical Revenue Loss
Actives Inactives
# Subscribers 250,000 200,000
Average Revenue Per
$0.12
Email Delivered
4 X week X 53 weeks
$6.4M
~ 212 emails
Potential Lost
Revenue $5.1M

15. SmartPak Program Overview

16. About Our Email Program
• ~1MM emails sent, per month
Email Volume
Transactional
• Email generates 34% of all online Promotional
& Triggered
Email, 11%
marketing channel revenue Email, 89%
• Healthy transactional and triggered
email program drives high return
• Email team comprised of:
– Email Marketing Manager
Email Revenue Transactional
– Email Designer & Triggered
… and three businesses to support! Promotional Email, 37%
Email, 63%
In 2010, launched 11
automated campaigns with
Silverpop, growing revenue
40% year-over-year
16

17. SmartPak’s Email Program Framework
Email Channel
Promotions Transactional Lifecycle
SmartPaks On-Hold SmartPaks
Newsletters Confirmation Welcome
Order Confirmation Order Reminder
Offers
Shipment Abandoned Cart
Confirmation
SmartPaks SmartPaks On-Hold
Confirmation/Welcome
Today, 26 transactional
Post Purchase
and lifecycle emails per Password Review
day, and 10+ promotional Recovery
emails per month
Credit Card Failure SmartPaks Up-sell
Notification
SmartPaks Cancel
Confirmation 17

18. SmartPak: Inactives History
Became aware of impact in 2007
Analyzed database = ~50% inactive
Tested suppressing inactives = exact
same number of opens/clicks

19. SmartPak: Current View
Win-back = Revenue
opportunity
Potential deliverability
impact
Reach through other
channels

20. SmartPak: Current Inactive Definition
No
No Opens 6+ Months
Purchases
40%-45% of database

21. Inactives Action Plan

22. Inactives Action Plan
Root
Causes
Define &
Minimize
Segment
Automate Reactivate

23. Why Recipients Go Inactive
Never fully engaged - just wanted the incentive
Interests / needs have changed
Content did not meet expectations
Emails are being routed to junk folder
You send too often for their taste
You send un-personalized, irrelevant emails
Long sales/purchase cycle
Inability to update email address / change preferences

24. Determine Root Causes
Are certain acquisition sources producing a higher rate of
inactives?
Has increased frequency numbed them?
Is your email program stale and boring?
Are you attracting the right audience?
Are you delivering against expectations?
Do you have deliverability issues?

25. Analyze…
By list source
Age on file
Customer segment/profile
Subscriber survey responses
Creative test results
Response by message type/frequency changes

26. Action Plan – Define & Segment

27. Defining Inactives – Sample Parameters
Email activity (opens & clicks)
Time on list
Purchase/Conversion activity
Web site/Other channel activity
Sales/Purchase cycles/Seasonality
Customer value/Ideal profile

28. All Inactives Are
Not Created Equal

29. SmartPak: Analysis/Definition

30. Understand Your Inactive Segments
More Potential? Less Potential?
Past customer Never purchased
Organic Opt-in Sweepstakes
Recent purchase Long ago purchased
High customer value Low customer value
Engaged in other No engagement
channels anywhere

31. Are inactives worth keeping?
Do we treat segments of
inactives differently?

32. Predicting Subscriber Value Potential
• Leading online retailer
• Suppressing inactive subscribers
• Hypothesis that “high value potential” subscribers
existed among inactives
• Leveraged third party data (purchase behavior,
demographics, etc.) and advanced modeling to predict
Subscriber Value Potential.

33. Approach & Results
• Segmented inactive Campaign Revenue per
subscribers by Value Subscriber
Potential and conducted $0.18
reactivation test
8.4x
• Results: High vs. Low $0.02
segment
• 1.8x higher Open Rate Low Potential High Potential
Segment Segment
• 8.4x higher Revenue per subscriber

34. Action Plan - Reactivate

35. Typical Reactivation Rate: 1%-2%
High Performers: 10%+

36. Re-engagement Series - Incentives

37. Re-engagement Series Results
• Performs poorly (as expected)
– 5.8% Open rate
– 1.8% click through rate
– 1-2 orders per fiscal quarter
• Non-responders are removed

38. Tell us what you want

40. LinkedIn: Reduced Frequency

43. SmartPak: Attempt #1
We miss hearing from you!
As a valued customer and subscriber to our e-newsletters, you are the first to
learn about new products, promotions, sales and healthcare
information. Don’t miss out on all of this valuable insight that comes straight
to your email inbox. If you prefer to receive your e-newsletters at a different
email address, please click here to update your profile.
We hate to see you go! But if you choose to no longer receive our e-
newsletters, please click here to unsubscribe. We hope to hear from you
again soon.
As a thank you for being our valued customer, please use this code (xxxx) to
apply free shipping to your next order with us.
- Your Friends at SmartPak

44. #2

45. #3

46. SmartPak: Reactivation Metrics
Metrics Reactivation Other Emails
Bounces 3% - 7% 0.57%
Open Rates 3% 18%
Reactivated 13,000 so far
AOV $111.19 $119.09
Avg Rev/Email $0.06 $0.20

47. Action Plan - Automate

48. Automate: Activate Early Inactives
New subscribers don’t
open/click first XX messages/X
weeks
Move these early inactives into
“activation” track
Send survey, different offers;
best of, diff subject
lines, testimonials, etc.

49. Sample “Month 4” and “Month 7” Program
Broadcast emails: 3-5 per week
No activity for 3 months – moved to reactivation track
Month 4: 1 email per week
Update
Sweepstakes Unique Offer New Brands
Preferences
Month 5-6: Normal 3-5/week
Month 7: 1 email per week
Promote other What You Are
Unique Offer Survey
channels Missing

50. Action Plan – Minimize

51. The best reactivation strategy
is to minimize inactives
to begin with.

52. Opt-in process
Preference mgmt. Expectation mgmt.
Minimize!
Targeted / Relevant Welcome /
Content Onboarding

53. Opt-in Source / Process

54. Setting Expectations

55. Welcome / Onboarding

56. Ask for More Information

57. Relevant Content – Post Purchase
Follow-Up
Emails
Sent after
1st Supply
order

58. Crazy Content
See Our Models
Nearly Naked in Our
New X-Ray Catalog

59. Footers – Make it Obvious
Include links to all 3 main options:
- Update preferences
- Change email address
- Unsubscribe

60. Enable Preference Changes
Change:
- Preferences
- Email address
- Frequency
- Topics
- Publications

61. Opt-down alternative to opt out

62. To Remove or Not?

63. No
Maybe
Yes

64. Remove, suppress or retain?
• Send less
• Treat differently
Retain •
•
Monitor reactivation
Have resources to deal with
• Deliverability
• Business decisions / low value
Remove subscribers
• Cost/Resource Savings
• Make sure they are truly inactive

65. Takeaways / Q & A

66. SmartPak: Some Lessons Learned
OK to suppress
Most inactives ARE inactive
Right definition/approach is key
Be careful

67. SmartPak: What’s Next?
Early activation/automation
Testing
Track the life of inactives
More behavior-based automation

68. Takeaways
Don’t ignore inactives – be
proactive
Focus on minimizing
Automate reactivation, rather than
one-offs
Test and Analyze

69. Questions?
Carey Marston
CMarston@smartpak.com
Loren McDonald
Twitter: @LorenMcDonald
lmcdonald@silverpop.com
Google+: Loren McDonald

70. Resources
• Resource Center
• White papers
• Webinars
• Blogs
• Case studies
• Newsletters
• http://www.silverpop.com/marketing-resources/index.html
• Many presentations on SlideShare
• www.slideshare.net/Silverpop

71. Thank you!
On Twitter: @Silverpop
www.slideshare.net/silverpop
www.silverpop.com