Marketing
Why last year's benchmarks matter even more to retailers now
Sharon Shapiro, director of integrated planning at Bluecore, explains how and why last year's email marketing program benchmarking is critical for structuring this year's program to be one of effective personalization.
November 27, 2020 by Sharon Shapiro
2020 has played with time in a way we've never seen before, with everything seeming to slow down and speed up all at once. Along the way, nearly everything has changed.
But one thing that holds steady is the need for retailers to benchmark the performance of email marketing programs. Benchmarking against last year's performance might sound counterintuitive in a year when everything has changed, but there is a method to the madness.
The e-commerce rollercoaster of 2020 has changed everything
The starkest change of 2020 for retail has been 10 years of e-commerce growth in a matter of months, with e-commerce finally outpacing brick and mortar as the primary shopping channel for the first time. Widespread store closings initially forced this behavior shift, but the incredible leap in e-commerce activity has remained even as stores have reopened.
Faced with this reality, retailers were forced to prioritize digital marketing channels, particularly email, which has long been the workhorse of every e-commerce marketing program. The near overnight shift in behavior forced brands to respond quickly, and those who could be the most agile reaped the rewards. In fact, many attained Black Friday levels of engagement over email and onsite during otherwise "random" days in the spring.
This situation appears to make benchmarking performance difficult, if not impossible. After all, in what context can brands reasonably compare this year's email engagement data to past performance when every single norm has gone out the window?
But here's the thing: If you want to structure your email program for effective personalization that breeds long-term loyalty, last year's benchmarks remain valuable for understanding performance.
When everything has changed, putting email performance into context matters even more
Most likely, your brand's own email benchmarks from last year are not instructive for measuring performance gains this year because so much has changed. But that doesn't mean you shouldn't — or can't — benchmark performance.
Building a highly personalized email marketing program that drives retention and nurtures customer loyalty requires retailers to organize their teams around customers, not channels. It means focusing on questions like:
● How do we convert one-time buyers into two-time buyers?
● How do we effectively save at-risk customers and win back lost customers?
● Which types of customers are the most valuable for our brand?
● What can we do from a marketing perspective to move more customers into this "high value" bucket?
Answering these questions has become even more important now than ever, since the enormous shift to e-commerce presented brands with more new customers and more data on how their shoppers behave in the digital world.
With this mindset, benchmarking against last year becomes not only possible, but also necessary — regardless of how much has changed.
Powerful benchmarks to plan for growth in a fully digital world
In the recently released 2020 Retail Email Benchmark Report, Bluecore looked at nearly 10 billion emails sent by more than 400 retail brands from March 2019 through February 2020. Bluecore specifically chose this time frame to avoid any unusual activity due to COVID-19 to deliver an effective and powerful tool for understanding this year's performance and planning for next year's growth.
This nuance is important because these benchmarks measure relative performance to help baseline expectations and strategies. For example, they evaluate:
● Performance increases from scaling the use of personalized emails by evaluating performance for three types of retail email programs: (1) those that use only static emails, (2) those that use a mix of static and personalized emails and (3) those that use only personalized emails. The data reveals a 133% increase in average conversion rates for retailers in the third category compared to retailers in the first (and only a 46% increase on the same measure for retailers in the second category compared to those in the first).
● Engagement and loyalty growth from growing cart sizes, as the data reveals that the more shoppers spend per order, the more likely they are to engage with emails. For example, high spenders in the apparel space deliver a 26% higher conversion rate than average spenders and a 48% higher conversion rate than low spenders. This trend persists for retailers of all kinds.
● Likelihood of saving at-risk buyers and winning back lost buyers, and the best levers to do so. The data identifies that 21% of customer lifetime value sits with at-risk and lost buyers and that those buyers are more likely to convert from emails than customers who have never purchased before. Personalization is the best way to win these shoppers back, as those who receive >10 personalized emails are 135% more likely to convert than those who receive one to five personalized emails.
Importantly, these benchmarks evaluate how different types of shoppers engage with emails relative to one another and the opportunities for improving performance based on changes like scaling personalization or adjusting targeting strategies for unique types of customers. In doing so, they offer a stable and reliable long-term view.
Ultimately, in a year when everything has changed, measuring email engagement against benchmarks becomes even more important for putting your program's performance into context. The key is to use the right type of benchmarks: Those designed to reflect modern, highly personalized email marketing programs that measure the relative impact of efforts like scaling personalization and comparing engagement and outcomes from different types of shoppers.
Sharon Shapiro is director of integrated planning at Bluecore.
About Sharon Shapiro
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