Deepen Customer Loyalty With E-Mail Marketing

Three Principles to Help Fashion an E-Marketing Plan

A recent E-mail Experience Council conference featured speaker after speaker expounding the benefits of e-mail marketing. What hit home was that e-mail marketing can deepen customer loyalty within any industry segment.

E-mail marketing is important to maintain, especially in this soft insurance market. Consider the following statistics, gathered from a mix of well-known business sources:

• Acquiring a new customer costs six to seven times more than retaining one.
• A 5 percent increase in customer retention yields profit increases of 25 percent to 100 percent.
• Repeat customers spend 67 percent more.
• During the time it takes to make 10 purchases, a customer has already referred up to seven people.

How can an agency retain its present customers, then deepen the mutual business relationship? And, what steps will initiate the process in an agency, bearing in mind a tight operating budget and an industry that seems to have turned into an abundantly disloyal “commodity market?”

Beyond keeping an intense watch on the way an agency manages its customer relationships — customer service, general operations, a well-rounded service offering, and so on — an agency needs to inspect its marketing and communication efforts. First, examine the content: Is the agency conveying a consistent and professional message? What are the costs associated with each communication tactic, and is there an adequate return on the marketing investment? In this soft insurance market, conducting that assessment is not just a luxury, it’s a necessity.

Next, consider the tactics. Is the agency living in the old days when first class postage was south of 40 cents and direct mail marketing really worked? Still running an ad in the local Yellow Pages that’s costing an arm and a leg and not generating any inquiries? What could the agency do to revamp those efforts in line with today’s digital world, and why?

Using e-mail marketing, agencies can conduct the same campaign and use the same budget to reach an audience 10 times the size they could have reached using direct mail. Search engine marketing has virtually replaced the physical Yellow Pages.

E-marketing tactics enable agencies to reach out to their customer bases with pertinent, relevant messaging, at a fraction of the cost of other direct marketing tactics. E-mail messages are timely, interactive, track-able, and they fit today’s lifestyle needs requiring faster methods of communication. E-marketing is a less expensive way of establishing and maintaining long term relationships with customers and prospects.

If an agency hasn’t converted most or all of its marketing dollars to a plan that focuses on e-marketing tactics, it’s time to make the move. The following are three overriding principles to help fashion an e-marketing plan and put a solid foundation in place upon which to create, maintain and deepen customer loyalty.

Building the database

Building customer loyalty through e-mail marketing is all about the database. A well-maintained database ensures the marketing message reaches the right target audience. By appropriately segmenting the database, an agency will be able to leverage data to hone a relevant message to the right audience. Start by analyzing data to segment the audience into separate groups that share common profiles and preferences.

For instance, cull subscribers by gender, geography, birthday, purchase behavior and other demographic attributes. There’s no need to waste time converting a customer who is presently purchasing auto another auto policy. That time could be better spent cross-selling a homeowners policy, for instance. This may be obvious, but recognizing it will allow agencies to hone the effectiveness of their communications to ensure subsequent dialogues are increasingly more targeted and more relevant. The better agencies can tailor the customer’s e-mail experience to relate more closely to them, the quicker they’ll establish customer trust and send communications subscribers really want to receive.

Segmentation that targets communications has been proven to build stronger, longer-lasting relationships with customers and boost e-mail campaign results. Sending the right message to the right person — at just the right time — will not only exceed the customer’s expectations but also lead to profits.

Minding the Message

Well thought out communication with customers brings benefits that are far reaching. When an agency informs and educates customers and prospects, they begin to perceive the company as capable of addressing their needs — they may even look to the agency as an expert. That develops trust, opens the door to two-way communication and allows customers to share their pain points. Using the information gained from customers enables an agency to better serve their ongoing needs, hone a unique selling proposition and close the door on competitors. And, the agency may discover hidden sales opportunities.

If an agency does everything right — builds the database, creates a strategic marketing plan — but fails to hone the message, its prior efforts are wasted. Think of the reaction to an e-mail in an inbox. If you open it and it doesn’t get a key message home quickly, you will not waste time reading it. There’s simply less space and less time to get the message across.

To craft a successful e-mail, follow this order of importance:

1. First and foremost, get the most important point across in a headline — the key benefit, the promotional offer, etc.
2. Summarize the most important parts of the message in three to five bullet points and place them in a sidebar close to the headline.
3. Include the remaining points in descending order according to importance to the overall message.

Next, remember the following key creative and technical issues:

• Include interesting visuals to hold the reader’s attention.
• Be interactive. E-mail has to incorporate click-throughs to the agency’s Web site and other pertinent destinations. It’s a vital part of the package — don’t ignore it.
• Positively impact open rates by using a credible sender’s name.
• Ensure the e-mail subject line is enticing. There are rules to follow that work.

Tracking and Follow Up

Don’t take the tracking ability of e-mail for granted. The abundance of tracking information is good for marketing and sales.

E-mail allows a marketer to know precisely who opens the e-mail and when; where they click-through; and who is just not interested in real time. At a minimum, that information will enable the agency to hone the relevancy of its message.

The days of traditional follow up, focusing on “hope” as a sales strategy, are over. E-mail tracking provides a depth of information that will ensure the agency only calls those people who have clearly demonstrated an interest in specific areas of its communication.

In these more challenging times, deepening customer loyalty has to be a primary objective for every agency. E-marketing can help achieve that goal, but an agency must infuse relevance into its e-mail communications to develop profitable, long-lasting relationships. Even more important, the agency must acknowledge that loyal, long-term customers represent the best opportunities for ongoing profits. The sooner they do, the sooner they’ll be able to integrate a sound acquisition strategy within a disciplined, well-thought out retention strategy, to drive and sustain profits.