For Marketing Leadership proFessionaLs
by shar VanBoskirk with Carlton a. doty , kara hoisington, and elizabeth ryckewaert
FeBruary 2, 2015
Why Read This RepoRT
There’s no doubt about it: Contextual marketing will reorient the role that email plays in your digital marketing toolkit. But marketing leaders need not abandon existing email campaigns in the name of adopting a contextual approach. The climate is ideal for innovating to improve your existing campaign performance while also laying the groundwork for more advanced approaches. This report identifies the key email innovations you should prioritize to get the most out of email marketing in the future. Forrester reviews and updates playbook reports periodically for continued relevance and accuracy; this report replaces an earlier road map report of the email marketing playbook.
innovaTe WiTh email maRkeTing noW
Recent email marketing vendor consolidation creates a perfect climate for marketing leaders to optimize the performance of current email programs while also adjusting their approaches to email to establish and exploit context. In fact, rather than slowing innovation, the email vendor acquisition spree of the past 24 months makes room for alternate players to introduce innovative offerings (see Figure 1):
■ Incumbent players introduce new capabilities.
Epsilon and StrongView Systems, two of the Leaders from our 2014 Forrester Wave™ evaluation of email marketing vendors, demonstrate an inspired ability to innovate.
1 Service provider Epsilon has redefined platform interface standards to be mobile-first, while StrongView offers real-time, contextual insights.
■ Vendors from related spaces enter email.
On-site testing and personalization vendors like Monetate and MyBuys now also create and deliver personalized emails. Dynamic ad-serving firms Criteo and
TellApart purchased email delivery engines to provide personalized predictive offers across channels.
And predictive analytics specialists like Custora and Windsor Circle have amped up their support for email service providers (ESPs) through advanced segmentation products.
■ New entrants challenge the status quo.
With most veteran email vendors focused now on integration with their new parents, newcomers or second-tier email vendors are ramping their capabilities and market presence. For example, Sailthru combines the big data capabilities of a customer analytics vendor with multichannel message deployment. SmartFocus (formerly Emailvision) now provides
“context aware” marketing through email, mobile, and physical channels. Demandware just purchased retail email personalizer CQuotient to create one-to-one experiences across online and offline commerce touchpoints. And straightforward ESPs like UK-based Adestra and Dotmailer are pushing into the United States.
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For Marketing Leadership proFessionaLs the time is right For email innovation 2
Figure 1 Alternative Vendors Offer Innovative Applications
Type of vendor
Predictive analytic s
Omnichannel personalizatio n
Innovative application
Automate predictive models to improve email targeting, relevance, and retention
Cust
We omize experiences across b, social, email, and mobile individuals
Dynamic conten t
Personalized retargetin
Email service provider s g
Design testing and optimization
Use context — like location, device, or weather — to personalize email content at the time of open
Target offers in display ads and email based on previous behavior in either
Evaluate how email permutations render in multifarious circumstances
Apply contextual insights to email deployments
Examples
• AgilOne
• Cust ora
• Lattice Engines
• Windsor Circle
• CQuo tient
• Monetat e
• MyBuy s
• Sailthru
• Selligent
• Smar tFocus
•
•
Kickdynamic
• Mo veable Ink
• PowerInbox
• Crit eo
TellApart
• Litmus So ftware
• Re turn Path
• IBM/ Silverpop
• Lyris
• Strongvi ew Systems
120926 Source: Forrester Research, Inc. Unauthorized reproduction or distribution prohibited.
advanced practices offer a Road map To Contextual email
New capabilities from these competing vendors help marketing leaders apply advanced email practices to improve campaign relevance and prep for more-sophisticated contextual marketing efforts in the future. In our research, we found that your peers prioritize these efforts:
■ One-to-one personalization.
We’re not talking about “Dear [first name]” or even messages tailored to previous email behavior or past online purchases. Over the next five years, emailers will individualize messages based on omnichannel habits, attitudes, and context.
2 For example, daily deal retailer HauteLook used a reactivation program developed off multichannel customer profiles from Datalogix to generate 14 times more revenue per member compared with its standard email programs.
3 True Religion Brand Jeans boosted click-throughs by optimizing message format to suit the device used to open the message.
4 And Redfin adjusts offers and content based on customer context, like the weather at time of open.
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For Marketing Leadership proFessionaLs the time is right For email innovation 3
■ Microsegment targeting.
This practice, which is sometimes the insight behind advanced personalization, means adjusting marketing and message strategy based on predictive analysis of specific user groups. A basic demonstration of this: MyBuys sharpens shopping cart abandonment emails by including products it predicts will drive a response based on the other items left in the cart. A more advanced example: Men’s apparel brand Bonobos increased customer lifetime value by 20% when it adjusted marketing messages based on predicted value and attrition of different customer segments.
5
■ Mobile first.
This is more than creating responsive templates that accommodate the size of multiple screens. With 60% of US smartphone users accessing personal email daily via mobile, marketing leaders must consider that users engage differently with mobile devices compared with PCs and must adjust email content, offers, and delivery strategy accordingly.
6 Graphic tee designer Threadless tests mobile-specific offers.
7 And members of Epsilon’s Email Response
Network increase open rates by 11% and click-throughs by 10%, on average, when they use the collective’s shared insights about response behavior by device to inform message content and delivery timing.
8
■ Email address as customer ID.
Email innovation isn’t just about improving the relevance of email messages. Email can identify users even when they’re using non-email channels. And email behavioral data can inform marketing through other means. Retailers we interviewed recognize this and prioritized e-receipt projects to collect customer email addresses. Cara Olson, the director of direct marketing and customer relationship management (CRM) at digital agency DEG, says she is getting more requests from clients for clienteling support that serves user profiles to store associates based on an email ID and past email behavior. She iterates: “We also deliver email promotions when a user is in-store. Email is in their hand while users are at the register.”
R e c o m m e n d at i o n s
Campaign innovaTions lay The gRound WoRk FoR ConTexTual maRkeTing
Don’t get stuck in the “this is the way we’ve always done it” mindset. Technology development and vendor competition will work in your favor to trial new attempts. Here are a few ways to get started in 2015:
■ Sift free third-party data for contextual cues.
You can create personalized, contextually relevant emails with no incremental data investment . In fact, Amazon, Google, and Microsoft have even built data exchanges to make free public data — like weather, census information, or traffic — more accessible to marketing leaders.
9 So there’s no reason not to innovate with customer context. Red Roof Inn applied this approach to its paid search programs. It boosted hotel bookings by 60% with no additional spend when it used flight cancellation data to trigger “stranded traveler” search engine ads.
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For Marketing Leadership proFessionaLs the time is right For email innovation
■ Take meetings from challenger email vendors.
More than incumbents, smaller ESPs and email newcomers are introducing cutting-edge email innovations. For example, MyBuys alerts generate nine times more conversions than regular segmented emails because they announce new products specifically to users who have completed certain behaviors.
And CQuotient increases revenue per customer 10% to 20% with emailed product recommendations based on online and offline data, including in-store activity, returns, and catalog orders. Most of these vendors offer flexible pricing and partner with — rather than replace — ESPs. We think you’ll be as glad as The Children’s Place, The Container Store, and
Helzberg Diamonds are that you sat through these vendors’ pitches.
■ Treat email as more than just a promotions vehicle.
The recommendations are tactical steps that you can take immediately. This third to-do is part of a long-term philosophical shift that we describe in the continuous improvement report of this playbook.
11 While you launch personalized campaigns that are designed for a mobile mindset, also gradually elevate the perception of email marketing within your organization. Retailer NastyGal applied analytics to its email strategy. Other retailers now collect email addresses at point of sale. And Epsilon finds that its most advanced clients staff email with veteran marketers — not recent grads — to give email organizational gravitas.
4 supplemenTal maTeRial
Companies interviewed For This Report
360i
Belk
Cancer Treatment Centers of America
Cardinal Health
Citigroup
CQuotient
Custora
DEG
Epsilon iCrossing
IgnitionOne
L.L.Bean
Lids
LiveIntent
Movable Ink
MyBuys
Rise Interactive
StrongView Systems
TellApart
© 2015, Forrester Research, Inc. Reproduction Prohibited February 2, 2015

For Marketing Leadership proFessionaLs the time is right For email innovation endnoTes
1 Email marketers can capture de novo opportunity if they innovate around email itself. Forrester identifies an email marketing landscape that is open to innovation. See the July 23, 2014, “ The Forrester Wave™:
Email Marketing Vendors, Q3 2014 ” report.
2 In May 2014, Monetate commissioned Forrester Consulting to evaluate how marketers use and value email and its role in the new digital marketing mix. Results from the research indicate that marketers are interested in (and will even pay a premium for) emerging email innovations like microsegment targeting, personalization — both basic and advanced, like open-time personalization — and mobile-first efforts.
Source: “Forrester Research: Innovate With Email to Create Competitive Advantage,” Monetate (http://info.
monetate.com/forrester-research-innovate-with-email-lp.html).
3 Datalogix data includes 90% of US households and more than $2 trillion in consumer-level channelagnostic purchase data. Read about HauteLook’s application of these insights. Source: “Audience Insights,”
Datalogix (http://www.datalogix.com/success-stories/solution/audience-insights/).
4 Monetate features its work with True Religion Brand Jeans. Source: “Open-Time Email Makes Testing a
Snap,” Monetate, January 28, 2014 (http://content.monetate.com/h/i/11568771-true-religion-open-timeemail-makes-testing-a-snap).
5 One of Custora’s signature offerings, its predictive lifetime value analysis, worked for Bonobos. Source:
“Predictive Customer Lifetime Value is a perfect fit for a brand that’s re-inventing men’s retail,” Custora
(https://custora.com/customer_results/bonobos_predictive_customer_lifetime_value).
6 Source: Forrester’s North American Consumer Technographics® Online Benchmark Survey (Part 1), 2014.
7 Threadless worked with Monetate to optimize its mobile experience. Source: “Threadless Turns Upping
Mobile Conversion Rates Into an Art Form,” Monetate, September 30, 2013 (http://content.monetate.com/ h/i/11568741-threadless-turns-upping-mobile-conversion-rates-into-an-art-form).
8 Collecting online behaviors or buying third-party data provides only a fraction of a complete customer profile. Attempting to achieve a 360-degree view of customers with these sources alone is a fool’s errand.
In an era of perpetual connectivity, with business users and consumers demanding always-on access to data and resources, you need data and insight from as many sources as possible. See the May 8, 2013,
“ Introducing Adaptive Intelligence ” report.
Epsilon’s Response Network (ERN) offers a data cooperative where members share and get access to email data from other members. This press release provides insights and recent developments linking ERN data with social networking profiles. Source: “Epsilon’s response network makes cross-channel integration possible with social media tool,” Epsilon press release, September 8, 2013 (http://pressroom.epsilon.com/ epsilons-response-network-makes-cross-channel-integration-possible-with-social-media-tool/).
9 Several cloud providers have built data exchanges to make public and commercial data sets more accessible to business users. See the May 8, 2013, “ Introducing Adaptive Intelligence ” report.
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For Marketing Leadership proFessionaLs the time is right For email innovation 6
10 Red Roof Inn — an economy hotel chain with properties primarily in the midwestern, southern, and eastern United States — out-innovated its bigger-budget competitors with a discovery marketing program that leveraged flight cancellation data to drive stays at its hotels. Specifically, Red Roof Inn serves ads to stranded travelers, customized with the distance to the nearest Red Roof Inn and a phone number to book at that property based on a feed of flight cancellation data. Please read the vision report listed on the email marketing playbook home page (https://www.forrester.com/The+Email+Marketing+Playbook/-/E-PLA230).
11 Email marketing business as usual won’t help you benefit from customer context. You need to stop thinking of email as just a low-cost, click-and-buy tactic. Please read the continuous improvement report listed on the email marketing playbook home page (https://www.forrester.com/The+Email+Marketing+Playbook/-
/E-PLA230).
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