Growing Your E-Mail List, Part 2: Retention

My last column covered skin and body care company Philosophy’s acquisition of online customers. I looked at how Philosophy drives customers to its Web site and demonstrates the value of membership so visitors sign up for its mailing list.

Today, let’s look at how Philosophy is keeping those people happy and looking forward to the company’s communications.

Barry Stamos of Inbox Marketing, Philosophy’s email marketing partner, cites research showing if a business sends three or more communications per month, response rates tend to drop. (Yes, there are exceptions. I happily anticipate my weekly United Airlines fare special email.) For a wide range of businesses, research shows sending twice a month, versus once a month, doesn’t change response rates.

With that in mind, Philosophy began sending a variety of relevant, valuable communications.

The Newsletter

Each month, Philosophy delivers an email newsletter. Included is a free offer and a refer-a-friend feature to keep the database growing. The original design was personable, reinforcing the brand graphically.

But a new design improves on the original. The format is even cleaner and easier to read. The message from Cristina Carlino, the creator, helps with brand identification. The free gift offer is higher in the newsletter, the better to grab attention. And the newsletter now carries testimonials, which help reinforce the notion of community as well as endorse the products.

Occasionally, Philosophy sends special holiday editions. These are relatively easy to put together — the basic newsletter template already exists. They deliver time-sensitive information. We can all use a reminder now and then that holidays need not be too stressful.

Special Promotions

Along with the email newsletter, Philosophy sends highly targeted promotional mailings once a month or so. These are based on new product launches, customer preferences, purchase history, and other factors. The list is usually segmented into two or three high-value customer segments to increase conversion.

Let’s look at an example: Pure Grace. The list was segmented into three groups: two based on the acquisition channels, one on product family purchase history. The breakdown:

• Lucky Sweeps acquisition segment (subscribers joined via a sweepstakes): 52 percent unique open rate and 20 percent unique CTR
• Organic list segment (subscribers joined through site opt-in): 53 percent unique open rate and 20 percent CTR
• Organic/lucky segments with product family purchase history: 63 percent unique open rate and 32 percent unique CTR.

Not surprisingly, those who already purchased from Philosophy were more receptive to the message, at least based on open rate and CTR. It’s interesting to see the statistics were roughly the same for those who joined the mailing list as a result of sweeps and those who opted in for other reasons.

Birthday Message

As a consumer, I know it’s important to feel recognized and special. I recently celebrated my birthday. Of all the email databases I’m a member of, only one took the time (and effort) to send me a quick note and a coupon for chocolate fondue at a nearby restaurant.

Philosophy sends a birthday message to each member. It’s timely and appears to be unique to each person. The message, short and sweet, offers a special gift to the recipient. Results? An 80 percent unique open rate and 33 percent unique CTR.

Viral Component

Technically this falls under acquisition, but the type of acquisition you perform determines the quality of subscribers/members. Recommendations from friends can influence people to join a community and to remain there. The refer-a-friend form on the Web site is simple,is quick to fill out, and includes a sample message.

Preference Center

A member preference center ensures members receive relevant email. For instance, one question relates to skin type. Although the form is rather long compared to other online sign-ups, email address is the only required field.

Philosophy says it’s had little resistance to the form. This is where Philosophy collects birthday information as well. (I love Philosophy’s age ranges. It features women over 60 at the top and groups 40 year olds with those in their 30s. Makes those milestone birthdays just a little easier!)

How well is Philosophy’s retention strategy working? Its unsubscribe rate is below 1 percent. Compare Philosophy’s rates with your own — you may just take away some tips.

Want more email marketing information? ClickZ E-Mail Reference is an archive of all our email columns, organized by topic.