Segmenting and Targeting to Improve the Bottom Line

I meet people who run e-mail marketing programs all the time. They may be attending an industry conference where I’m speaking, or they’ve contacted me for a consulting project, or the topic comes up in a social situation.

It’s rare to encounter people completely happy with their e-mail marketing results. Many marketers hope to get more from their e-mail marketing program, but they have a problem. Some have so many different goals for each send, that no e-mail, no matter how great, can ever accomplish them all.

Problem: Multiple Goals

A niche publisher had a free e-mail newsletter. It’s published every other week, opposite of a paid print/electronic publication. The audience was a mix of prospects and paying subscribers. For the first group, the primary goal was to sell paid subscriptions, with sales of ancillary publications also valued; for the second, the goal was retention and sales of ancillary products, such as special reports and audio conferences.

The e-newsletter contained ads for audio conferences and special reports, which were relevant to both groups. It also included a pitch for the paid publication. That’s a waste of space for existing paid subscribers. No attempt was made to retain these current paid subscribers.

The audience mix was also wreaking havoc with the publisher’s editorial content. The company couldn’t include anything from the paid publication, because paying subscribers would have seen the content the previous week. So it was forced to create new content specifically for the free publication. It did this in the most time-efficient way possible, which made sense from a resources standpoint. Trouble was, these articles were shorter and superficial and didn’t provide an accurate representation of the paid publication’s editorial quality. Prospective subscribers couldn’t get a true feel for the content they’d get if they became paid subscribers.

Compounding these issues was the lack of tracking and reporting. No reporting on opens, no records of clicks, and few Web analytics to tell how successful current efforts were. According to the client, the Web site wasn’t selling any paid subscriptions. Clearly, none of the marketing directing people to the site, from the free e-mail or other channels, worked.

Solution: Divide and Conquer

The first thing this client should do is create separate e-mail newsletters for these two very different audiences. While they may be able to share some content, the marketing must be tailored to each audience.

For the prospects’ e-mail newsletter, I recommend implementing a traditional online publishing model. “The Wall Street Journal” is probably the most successful example, but it’s effective even for small publishers.

In this model, the e-mail newsletter is partially a tease. It contains brief blurbs about the articles, something written to be engaging and pull in readers. In some cases, readers are able to click through to read the full text for free. In other cases, they hit what we used to call a “soft door slam.” This is the marketing opportunity. Here readers are told the full text is only available to paying subscribers. The primary offer is an annual subscription with a nice incentive; a secondary offer may be a single-article or monthly subscription. Every time a reader hits the soft door slam, you’re building the case for them to subscribe — and moving a free subscriber one step closer to becoming a paid subscriber.

Creating a soft door slam page is easier said than done. It must be firm but friendly. It should engage and entice rather than anger the visitor.

Stephanie Fierman, SVP of sales and marketing for DC Comics, says, “This model proves to visitors that they would find value in the paid publication, rather than the marketer simply saying so. In many ways it’s a softer, but much more powerful, sell.” Fierman and I implemented this model for a number of publications, including “Variety,” when we worked together at Reed Business Information US (formerly Cahners).

A separate e-mail vehicle must be developed for paying subscribers if the publishing company is serious about retention and ancillary sales. It shouldn’t include subscription offers, but instead focus on advanced, or “blanket,” renewals, to get subscribers to sign on for another year or more before their current subscriptions expire. These renewals take just a little effort but can pay off in big ways. The publisher can take advantage of money’s time value by getting use of the renewal fees earlier than expected. It also saves the cost of its renewal series for people who respond to the blanket renewals.

By splitting this audience into two segments, the publisher is better able to target editorial content and promotions to meet their needs — and its bottom line goals for each group.

Until next time,

Jeanne

P.S. Will you be attending the ClickZ Specifics: E-Mail Marketing in New York City on October 2? If so, e-mail me and let’s arrange to chat over coffee!

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

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