1. Maximizing Relevance Through Personalization
Personalization, a hot topic in all areas of digital marketing, is absolutely essential in email. Even though the medium is ideally suited to personalization, many financial marketers still regard email as a “one-to-many” tool to broadcast messages. The “spray-and-pray” approach is still all too common — inexcusable considering the volume of data financial institutions have available right at their fingertips.
According to Matt Snodgrass, Director of Marketing at MarketingProfs, two of the most important trends in email surround the interlinked concepts of context and purpose. Consumers are bombarded with thousands of messages screaming for their attention every day — each trying to distract them from what they’re doing. Only messages that are contextually important are going to resonate because they mesh with what people are doing. Banks and credit unions can send emails that pitch product features all day long. But in the end, people don’t want features. They want to know how a financial product helps them achieve their end goal. The central idea is one of purpose, which consumers increasingly are demanding.
Chad White, Research Director at Litmus, a company specializing in email optimization, says personalization now goes well beyond first-name merges and other superficial gestures. It’s now about demonstrating that you truly understand consumers on a deeper level, and can act on their unique needs and wants. Marketing automation tools can accelerate the delivery of bulk marketing messages, but it can also be leveraged to deliver the right message to the right person at the right time, helping consumers make better decisions as they travel down the path to purchase.
Email personalization can be used to create “surprise and delight” campaigns, says Eric Fahey with Mintel Comperemedia. Used correctly, personalization techniques can help focus content in newsletters, and improve trigger-based communications (e.g. follow-ups to abandoned applications).
Margaret Hamner, Senior Email Marketing Manager at Mailchimp, says personalizing subject lines has proven to have a positive impact on open rates, and they would know. They see the results for hundreds of thousands of email marketing campaigns every year. Hamner says that you will generate an even bigger impact when the content within an email is personalized as well, including dynamic images and product recommendations geared to an individual consumer (or at least segments within the broader audience).
Consumers have come to expect customized and relevant content, explains Tom Sather, Senior Research Director at Return Path, and are quick to delete any email that feels “generic.” Sather offers these tips to help financial institutions get personalization right:
- Use a preference center to capture important data about what kind of content consumers want from your brand and how often they want to receive email.
- Take personalization beyond a simple greeting by digging into behavioral, demographic, and location data — even weather data and regional customs — to create an email that feels customized to each recipient.
- Consider where consumers will most likely open your email. Financial marketers should know by now that a high percentage of email messages are read on mobile phone. That requires mobile friendly content and responsive design.
2. Artificial Intelligence and Machine Learning
According to Sather, the future of email marketing will — eventually — be fully intertwined with artificial intelligence. He cites several examples. For instance, email send times could be optimized to ensure each consumer receives email at a time when they’re most likely to be active in their inbox. Send frequency could be fine-tuned using AI. And email content could be customized to ensure that the most relevant product information, offers, and promotions are sent.
In the coming years, Hamner with Mailchimp believes AI and machine learning could have a significant impact on email marketing. However, both these trends depend deeply on high-quality, very specific data. In the mean time, many financial marketers are still bumbling around with basic segmentation strategies. They are still far from the level required to support AI and machine learning.
While the potential for customization in email marketing is phenomenal, AI is still largely in the theoretical stages for most financial institutions, in part because it’s expensive to deploy, but also because the industry lags behind other sectors like retail, travel and entertainment. As Gina Bleedorn, Chief Experience Officer at Adrenaline, one of the world’s most respected financial branding and marketing firms, point out, financial marketers are simultaneously hungry for AI while also drowning in data.
Marketers feel there is a constant challenge to serve up hyper-relevant content to get someone hooked, but there is no seamless way to sort and sift data to predict the next buzzworthy trend or hot topic their audience will be interested in. Bleedorn says that without some sort of AI backbone that can help collate and organize all this data, financial marketers are left with a largely manual process.
Bottom line? Banks and credit unions need to start investing past the free tools embedded in marketing platforms to really begin to understand audience segmentation.
( Read More: 3 Ways to Optimize Email Marketing for Mobile )
3. Integrating Email Into an Omnichannel Marketing Strategy
“Consumers want a human experience more than ever before. Make it easy for people connect with a representative from within the email.”
— Eric Fahey, Mintel Comperemedia
Sather with Return Path recommends financial institutions regard email as a critical tool in their brand-building arsenal. Beyond simply delivering statements and promoting financial products, email can be used to deliver engaging, value-added content. This could include things like timely commentary on financial topics, particularly when they’re customized to the recipient’s life stage.
Many financial brands have discovered that email marketing yields data that makes other channels more effective, and vice versa, a trend Chad White with Litmus describes as “a massive ‘de-siloing’ of email.” According to data cited by White, one in four of brands feel that their email marketing programs are now highly integrated into their other marketing channels, and that number will continue to grow in the years ahead.
James Robert Lay, CEO of the Digital Growth Institute, believes that email is so important that all digital marketing activity should, in fact, be built and organized around it. Lay says it starts with lead generation first (i.e., capturing people’s email addresses), followed by “lead nurturing” — building brand credibility through a series of communications (i.e,. content marketing). According to Lay, the goal of any email marketing strategy is to build a “digital community”, particularly around non-customers because financial institutions can nurture those relationships over time with strong, helpful content, while also tracking and segmenting their behavior.
One way to build a better email list is to use social media to capture email addresses.
“If they do that,” Lay says, “financial institutions will longer will have to pay Mark Zuckerberg to access Facebook users.” This is something Lay pejoratively refers to as the ‘Zuck Suck”, meaning paying Zuckerberg and Facebook to boost your posts because organic reach has fallen to zero. Community events are another great opportunity to collect email addresses.
4. Leveraging Email for Onboarding & Cross-Selling ROI
“With email marketing sometimes less is more. Consider sending messages only when you have something truly useful to offer a customer.”
— Gina Bleedorn, Adrenaline
Several of marketing pros point to onboarding as one of the most important times to engage new customers with email.
“Statistically speaking, the majority of products and services someone is going to acquire with a financial institution will be opened in the first 90 days,” notes Bleedorn with Adrenaline. “That onboarding period is a critical and advantageous time for email marketing.”
When using email as an onboarding tool, Snodgrass at MarketingProfs cautions banks and credit unions not to throw everything at new customers all at once. “A welcome series is so much more impactful than a single welcome email,” he says. “It allows your customers to gradually get a feel for your organization, your beliefs, and your products.”
Hamner with Mailchimp agrees that email marketing is ideal for cross-selling with current customers, or with prospects who have opted-in to your communications. Email marketing falls short for prospecting. Email communications should ideally only be sent to existing customers and to prospects who have expressed an interest, especially with recipients outside the U.S. Web forms, ads, social media, and SEO are much better tools for prospecting, and can be used to gather opt-ins to feed your email marketing campaigns.
Similarly, Fahey at Mintel Comperemedia suggests financial marketers request feedback in the early stage of a customer relationship by using quick email surveys. Not only are new customers more engaged, they view products, services, and the customer experience with a fresh perspective that could provide valuable insight into your processes, and also into that customer’s expectations. If you ask the right questions in the beginning, you can keep your messages relevant… and avoid the dreaded opt-out.
5. Focus on Conversions, Not Clicks and Open Rates
According to Fahey, the average open rate among some 34 billion emails in the financial industry monitored by Mintel Comperemedia, is 22.4% (that figure excludes statement and alert emails). Great open rates differ from product to product and sender to sender. A campaign with a 40% open rate might be astronomical to one company, but average among industry leaders. So email marketers should aim to beat their own benchmark with each send to drive engagement incrementally.
High click rates show that your audience finds your content relevant enough to want to learn more. MailChimp’s Hamner says the average click rate from their exhaustive research is around 2.5%. If you find click rates dropping, Hamner says you need to adjust your call to action — including where it is placed in your email — and make sure to provide your audience with a single, clear message in each email.
However, while open and click-through rates are generally considered important performance indicators for any email marketing campaign, but Hamner says they shouldn’t be used as the sole metric used to evaluate email effectiveness.
“The goal of your campaign should drive your performance benchmarks,” she stresses.
Instead of obsessing over open and click rates, financial marketers need to place greater emphasis on conversion rates — how often people in your target audience take a desired action. Simply getting people to open emails and click on links within them is not usually a marketer’s end goal. Most financial marketers want consumers to acquire another product or increase usage of an existing product. In that lens, a relatively lower click-through rate might not be a concern if enough people take the steps necessary to reach the ultimate destination.
Hamner says each email should have only one clear call-to-action. Studies show that a reader is only going to engage for 7-9 seconds, and you don’t want to lose interest by making them sort through competing messages. Understand exactly what it is you want recipients to do, and make that crystal clear to the reader.
6. Test Early and Often for Many Factors (But Not All at Once)
James Robert Lay with the Digital Growth Institute poetically describes the subject line as “the door to your email”, so testing that should be a no-brainer. According to Lay, every email campaign you send out should include an A/B test on the subject line. You don’t know what will work until you try it, and there usually is no additional cost for running such tests.
Sadly, many marketers use open rates to determine subject A/B test winners, when they’d be much better off using deeper metrics. These could include revenue per email, revenue per subscriber, lead generation, campaign revenue, and — as noted above — conversion rates.
Beyond subject lines, calls-to-action can also be tested. Try testing the perspective of the call to action — i.e. “click to apply” versus “I’m ready to apply.” Remember, however, that just getting people to click isn’t as important as your conversion rate. When you test calls-to-action, concentrate on this metric.
Snodgrass with MarketingProfs cautions against testing too much at once. “Typically we find it’s best to stick to testing one thing at a time,” he says. Calls-to-action, buttons, copy length, email templates, style and tone of emails (e.g., emotional vs. factual, colloquial vs. formal), imagery, send days and times, and segmentation models are all among the variables Snodgrass recommends testing.
“Testing just one variable at a time is ideal for most marketers,” agrees Chad White at Litmus. According to his research, subject lines are the most tested email element, with 95% of brands regularly testing them. Calls-to-action (61%), images (44%), send times (44%), and email layouts (42%) are next most popular elements to test. A big missed opportunity is A/B testing what’s called “preview text,” which has an impact on inbox impressions that’s nearly as big as subject lines.
Snodgrass with MarketingProfs offers this final word of advice.
“There is nothing more important than living in the shoes of your audience,” he says. “If you don’t view every single email through the lens of the consumer, you’re doing it wrong. Too many financial marketers check to make sure the email looks good and reads properly. They need to walk through the entire user experience from soup to nuts to be sure it all makes sense and resonates with consumers.”