Segmentation: How a small office supply ecommerce site boosted revenue 25% by sending more emails

SUMMARY: "We started to read about companies doing all this great targeted marketing. We realized we really should be doing more of that," said Andrew Jacobs, Director of Ecommerce, JAM Paper & Envelope.

The small team details going from one to 100 email designs per week to achieve a 25% increase in revenue from this email transformation.

This campaign from JAM Paper is one of five finalists for the MarketingSherpa Award — Reader’s Choice Email Campaign. We looked at all of our case studies and speaker applications and selected the best content to share with you.

by Courtney Eckerle, Manager of Editorial Content

Out of 500 speaking submissions and email case studies, the judging panel for MarketingSherpa Email Awards 2015 selected five finalists for the MarketingSherpa Award — Reader’s Choice Email Campaign.

This case study, originally run in August, meets our criteria of being transformative, customer-centric, innovative, transferable to marketing peers and has strong results.

In the coming weeks, the four additional campaigns will be sent out in our newsletters prior to opening the voting period on MarketingSherpa blog for you, the readers, to decide a winner.

CHALLENGE

JAM Paper & Envelope has brick-and-mortar stores in New York City, but in 2007, it launched its ecommerce efforts with a website. Currently, it sells on other marketplaces such as Amazon and Staples.

Andrew Jacobs, Director of Ecommerce, JAM Paper, and his team focus on the branded website, JAMPaper.com, for which they were using "a basic email platform." Jacobs added they were doing batch-and-blast email marketing.

"Essentially, we come up with one email a week, or every two weeks, or even a month if we didn't have time, and we would send it out. We would just cross our fingers and hope for the best," he said, and everyone on the email list for JAM Paper received the same send.

"We're lucky if we were able to track the conversion rate. That was it. That's what we did for a long time," he said, adding the team wasn't tracking anything beyond simple open rates.

CAMPAIGN

The first challenge the team realized was that "the general email blast was still an OK blast," Jacobs said, but they wanted to interact with customers more frequently through email marketing, and also make the sends more targeted.

The first campaign was a welcome series, initially with everyone who signed up receiving the same email. This gradually developed as the team realized the campaign needed to be personalized further and incorporate customer behavior and data.

JAM Paper took the success from developing a welcome series and applied it to other areas of the email marketing program, including a retargeting series and an abandoned cart campaign.

With each new campaign, the marketing team learned how to use customer behavior and data to segment sends for relevance.

Step #1. Develop welcome series

The first campaign JAM Paper decided to set up was a welcome series, and everyone who signed up received the same email. That aspect developed over time as the team realized that "not everyone who signed up from our site is really the same type of customer or the same person."

Some people, he explained, have placed an order and some people were just signing up to receive emails.

"We split it up between a welcome 'ordered' series for people who have ordered and people who have not ordered. We started talking to those people differently," he said.

Specifically, the people who just signed up would receive a coupon. But, someone who recently placed an order would be welcomed to the email program and would be shown other popular products.

"At the time, nothing was automated on our end into the email software," Jacobs said.

Starting with the launch of this campaign, Jacobs downloaded data from the website weekly to see who is ordering and signing up, and then uploaded that information into the email program.

"While it wasn't real-time data, it was still close enough to someone signing up," he said.

For the "have placed an order" segment, sends were separated into people who have ordered products and people who have placed sample orders.

"In theory … the more emails that are set up, the better, because they are more targeted. If we have an email going to a million people, it's just not going to perform as well as an email that’s being sent out to 120 people," he said.

Step #2. Utilize unique behavioral data in retargeting emails

After the welcome campaign was running, the team began setting up a few other campaigns.

"We realized this was working great. Who else should get an automated email?" Jacobs asked.

The next campaign the team tackled was a lapsed purchase campaign — people who haven’t ordered in a long period of time. For JAM Paper, this meant everyone who hasn't placed an order in 17 months.

"That's not targeted [and] it doesn't do as well," he said.

So instead of only looking at lapsed customers, the team focused on the natural behavior for each customer to try to reach them when a buying decision was about to be made.

"Time to reorder" email

The "time to reorder" email was targeted to a specific person, as opposed to the general lapse, which was sent out to anyone after 17 months. The time to reorder email was based on a customer's specific average time between orders.

This meant that some customers use the products on a weekly or monthly basis, and some only order once a year. Therefore, the marketing team developed a system to discover this information about their consumers, and used it constructively within the email program.

"This was the first time we got complicated. We looked at the data and calculated anyone who has ordered more than twice, calculated their own average time between orders," he said, explaining that if a customer ordered five times, for instance, they have enough data to determine an average order time.

"Your average might be every seven months, where someone else's average might be every three months. Someone else's average might be every one-and-a-half years. When that person passes their average time to reorder, we would send them reminder email, which does include a coupon," he said.

This was the highest-converting campaign in the email program, second to the abandoned cart triggered sends (more on that in Step #3), and some months see a 50% conversion rate, according to Jacobs.

The campaign resulted in "unbelievable numbers because it is so targeted," Jacobs said. "The moral is, whenever we could think of a way to talk specifically, as close as possible to our customer, the better it does."

Adapting to coupon websites

The customers JAM Paper was retargeting were receiving different coupons in this campaign, "then what happened was, it [was] working too well," Jacobs said, elaborating that "all of a sudden, too many people were using coupons."

This issue is one they deal with frequently as ecommerce marketers, he said.

In this instance, the team took a step back from the excitement of implementing the new campaign and thought "maybe we're giving coupons to people who don't really deserve them yet … because not everyone is the same type of customer."

Another part of the issue with too many coupons being used is that the codes often get out on the Internet on coupon websites for anyone to use, not just email subscribers.

The metrics can be thrown off because they are attempting to retarget current customers, and then a new customer uses that code from of a coupon website.

"It had nothing to do with whom we were targeting there. Those do get out there sometimes quickly and sometimes not quickly. It just varies how quickly those coupon sites get their hands on them. … That is 100% going to happen. The question is just when," Jacobs said.

To solve this problem, they change the codes frequently, he explained, looking out for any unusual spike in a code's use.

Step #3. Set up abandoned cart emails

"At this point, we were comfortable with email marketing; we knew it worked. We realized this was going to take a little more work," Jacobs said.

This was about 10 months after the team started, and they had been manually uploading all customer information.

However, that system would no longer work, he said, because the process was happening once a week, and they wanted to implement an abandoned cart series with the first email being sent out only one-and-a-half hours after the abandon. The team was also limited in the amount of fields they could manually upload.

"That could no longer work by uploading data. We had to be connected to our email program. That did take a while for our developers to 100% get right. That was not necessarily an easy process, but it was worth it," he said.

First, the team implemented the automatic email signup process on the website, and then began integrating the information so that every contact who registers is immediately pulled into the email service provider's database, and every field is automatically updated. More order and product information was also collected.

Once it was set up, he said, within a week it became "our best-performing email by far. It produced the most revenue. They have the higher open rates. They have the highest clickthrough rates. They have the highest conversion rates," Jacobs said.

Jacobs explained he wouldn't suggest starting with an abandoned cart email because "it is difficult and you do need to have an understanding of everything," he said.

Currently, JAM Paper has four emails in the abandoned cart series, the first of which only shows one product: the first product the customer placed in their cart.

"It's essentially a 'did something go wrong?' type of email," Jacobs said, adding the purpose of the email is to be a helpful reminder and direct people to customer service if need be.

The subject line states, "Oops! Can we help you with anything?"

The second email is sent two days after the cart is abandoned, and shows two items from the shopping cart, and urges the customer to restore their cart. The subject line reads, "Hurry, the items in your shopping cart will expire soon!"

The next emails are "pitchy" Jacobs said, and offer a coupon. However, not everyone receives these last two emails.

They chose to exclude existing customers from the last two emails, and only send them to new customers who had entered their address before abandoning.

"We're not going to pitch you and bother you if you're just not ready yet, but you are already a customer of ours. We've chosen to only do this to new customers. We know we're leaving some revenue on the table, but we don't want to be annoying either," he said.

Design a responsive template

At this time, the team designed a responsive template for the emails they were developing.

"It's going to look good whether you open this on your iPhone, your computer or your iPad, and it's going to show the products that were in your cart whether you open it on a different device or in a different location," he said.

They implemented this, he added, so that if someone abandoned their cart at work, when they checked their tablet or phone at home, it would be there and the customer would be able to restore their cart from any device.

RESULTS

The team is continuing to improve these campaigns, but the results they've been able to garner so far from the abandoned cart series are:

8% increase in open rate from 2013

7.5% of the total revenue in 2013 from email marketing in less than four months

30% of the current email revenue for 2013

The averages of the abandoned cart series are:

31% open rate

12% clickthrough rate

23% conversion rate

The first email of this series registered the highest performance, with an average open rate of 46%, an average clickthrough rate of 16% and a 32% conversion rate.

The "time to reorder" email had the highest overall conversion rate, according to Jacobs. From August 2013, it had an average of a 45% conversion rate.

Overall, JAM Paper email revenue is up 25% from last year, which is indicative of the company's transformation.

"We went, essentially, from a year before sending one email design a week to at any given time, we probably have 40 or 60. … We probably have 100 differently designed emails at this point," he concluded.

"Our emails are constantly getting better," Jacobs said, adding that they are getting into testing all of the elements of the email campaigns.

"We'll test subject lines. We'll test where the call-to-action button is. Or we'll test what the call-to-action button says or what color it is. We started to have fun with it," he said.

In the beginning, he added, "all we worried about was, if you look at our emails, it was the ugliest email ever. But they were being sent and they were performing well. They were working. We were excited."

This case study has been selected as one of five finalists for the MarketingSherpa Award — Reader’s Choice Email Campaign.

Keep reading MarketingSherpa newsletters to see case studies from other finalists, and then in a few weeks, we’ll ask you to vote for your favorite on the MarketingSherpa blog.