The holidays are just around the corner and retailers are busily preparing their marketing strategies, which include more online efforts.
Last year, while overall retail sales were rather slow, online sales increased from years past. According to Forrester Research and Shop.org, 2006 online sales increased 20 percent year over year to $211.4 billion. Furthermore, Forrester projects that 2006 online holiday shopping sales reached $27 billion — a 27 percent increase over 2005. With customers moving online, e-mail marketing has become a core to holiday marketing campaigns.
Online gourmet food Web site GourmetStation.com makes 40 percent of its sales in the fourth quarter with a majority of those taking place in December. The online retailer, which specializes in gourmet prepared food, has found that e-mail helps build customer relationships, especially around the holidays.
“E-mail is our main way of communicating with our customers and building the ongoing relationship,” says Donna Miller, founder/president of Atlanta-based GourmetStation. “It is very important to send more e-mail around the holidays, because our customers generally shop at our store for gifts.”
GourmetStation normally sends e-mail to its 15,000 customers once a month, but increases the frequency during busy holiday seasons, including December, May (Mother’s Day) and June (Father’s Day). The call-to-action in the e-mails always includes a special menu designed for the holiday at hand. This past Mother’s Day, the e-mails focused on a Tuscan dinner, while for Father’s Day, the e-mails recommended an Americana menu.
Holiday mailing plans
This holiday season the menu will focus on an Old English Beef Wellington meal, back by popular demand from last year’s most popular sales. According to Miller, free shipping is a key to getting these e-mails opened and orders placed.
“We generally offer free shipping or some other kind of discount in December,” she says. “Consumers expect these kinds of offers.”
This year Miller says she will begin her e-mail campaign during the first week of December, which will push the Old English Christmas Dinner, though she doesn’t expect huge during this first week.
“The Web really enables procrastination,” Miller thinks. “Although we will start the campaign in early December, people do not really become active shoppers until around December 10.”
These e-mails focusing on the dinner will continue into the second week and then by the week of December 17, the call-to-action will change.
“Our last ship day to be able to offer free shipping will be the 19th for delivery on the 21st, since Christmas Eve will be on a Monday this year,” Miller points out.
By the 17th, the e-mails will call customers to purchase gift certificates, which represent a good portion of the retailer’s sales at this time of year. Until the 20th or 21st, e-mails will be sent out pushing the gourmet store’s physical gift certificates, which are for an entire meal, rather than a dollar amount.
“People are usually wrapping things up by the 21st, so we will stop sending e-mails at this time,” Miller says. “But these last e-mails will push the e-mail gift certificates for people looking for something at the very last minute. They can buy e-mail gift certificates, which are e-mailed immediately.”
Since every retailer knows that e-mail is a key to holiday business the inbox can get incredibly busy during this time of year. Secure e-mail delivery services firm Goodmail found in its “Survey of consumer attitudes toward e-mail trust” that 72 percent of consumers said that if they get too much mail, “I simply just don’t open e-mails that I probably should.”
David Atlas, senior vice president of worldwide sales and marketing at Goodmail, says that it’s about quality and rather than volume.
“This is the time of year that you have to fight your base instinct and every natural impulse to send a higher volume of e-mails,” he says. “If you do this, you end up with a consumer that just stops looking at e-mail altogether. You have to differentiate. If you want to be heard, sure you can talk louder, but it’s better if you slow down and talk slower and say something interesting.”
GourmetStation.com will be competing with the likes of 1800Flowers’s gifts division, Omaha Steaks and Harry and David for their customers’ attention and still plan to use e-mail.
“It’s not about having a clever subject line,” Miller says. “I think that to get consumers to open e-mails during the busy holiday season you have to have a strong offer and be clear about communicating this offer. The design should be less busy and include bullet points instead of copy.”
To make sure that it is sending mail to a clean list, GourmetStation employs the services of e-mail marketing firm Mail Chimp, which makes sure that the image-based design templates are CAN SPAM compliant.
Gourmet Station reports to an average open rate of 12.9 percent in 2006, but this increased during December. The retailer saw an annual average of 20.8 percent click through in 2006. Depending on the month, conversion in 2006 ranged from 4 to 7 percent, with December and May showing the highest opens.
The holidays are also a good time for retailers to check their progress on open statistics, as well as to make sure that their reputations are clean, as it is a time of mass mailing.
“The holidays are a good time to set up a baseline and see where you are in terms of reputation,” says J.F. Sullivan, vice president of marketing at reputation services firm Habeas. “The first thing you have to do is to see how you will look before you send out your mailing, because fixing problems after the fact will make you lose revenue.”
Habeas client Infinity Resources, parent company for retailer DVD Planet, is implementing a CRM system that is tied to feedback loops, which are then incorporated into the call-to-action. This holiday season the movies retailer will be killing two birds with one stone, marketing holiday gift items while measuring their performance.
For multichannel merchants, building special offers into the Web can be a deal breaker for consumers looking for the perfect gift.
“Offering a Web exclusive product is a good way to attract your customer’s attention rather than just offering a discount like everyone else will be,” says Mike Weston, managing director at Silverpop. “Also, pay attention to your customer and offer relevant offers. If e-mail is a conversation, then there are so many ways to take cues from a consumer’s behavior.”
And when it comes to offers, sometimes it’s better to do the math for consumers, who may be too busy or just too lazy to do it themselves, especially around the holidays.
“It tends to be more effective to offer a dollar off than a percentage off, which may be due to consumer laziness,” Weston adds. “You don’t want to make a consumer work too hard, so making these offers easier to compute and sending relevant product offers with good merchandising is the way to do it.”