One Size Does Not Fit All: Offers and Messaging
Keeping personalized e-mail on message for different list segments.
Keeping personalized e-mail on message for different list segments.
Parts one and two of this series discussed a proven way to segment a database based on the time-tested recency, frequency, and monetary (RFM) approach long used by direct marketers. Today, we’ll talk about crafting offers and messages for the 125 permutations the chart below represents.
Customer Database (%) |
Recency | Frequency | Monetary |
---|---|---|---|
Top 20 | 5 | 5 | 5 |
21-40 | 4 | 4 | 4 |
41-60 | 3 | 3 | 3 |
61-80 | 2 | 2 | 2 |
Bottom 20 | 1 | 1 | 1 |
Using this simple matrix, a “5” under recency means the cell represents the best 20 percent of your database in terms of when the last purchase was made. Similarly, a “1” under recency means those customers haven’t purchased recently. A “1” under monetary means they’re in the bottom 20 percent in terms of amount spent, while a “5” means they’re top spenders. A 5-5-5 represents your best customer, while a 1-1-1 represents your worst.
Today we’ll discuss offers and messaging for the groups that emerge from this exercise. Offers and messages to 5-5-5 customers should be very different from those to 1-1-1 customers. On the other hand, offers and messages for 5-5-5 consumers may be the same or very similar to 5-5-4 consumers.
Offers
The offer is at the heart of email designed to:
Let’s look at three groups from the matrix and the type of offers you might construct for each:
I don’t expect you to develop 125 offers unless you have a gigantic database containing large numbers of consumers in every cell. Target the top three to six permutations first. If the results prove the method, do the next 10, and so on.
Messaging
Messaging is straightforward once offers are in place. Your email formula or template should consist of:
A consideration here is having two-three messages for each of the above bullet points that deliver the most relevant message based on the RFM group.
A Really, Really, Really Important Warning
A catalog company recently went out of business due primarily to the fact catalogs were sent to the company’s worst customers.
Before you send a single email, make sure you have a fail-safe testing process in place, one that requires multiple confirmations the messages are sent to the correct groups. Though the financial costs of making the mistake of sending a 1-1-1 offer and message to a 5-5-5 customer aren’t as great as they would be for a catalog, return on advertising spend (ROAS) and top-line sales will meet with even greater effect. Consumers expect a higher level of personalization from email marketing. Negative response to irrelevant email is much greater than to print marketing communications.
Make sure that never happens, and keep reading…
Want more email marketing information? ClickZ E-Mail Reference is an archive of all our email columns, organized by topic.