Email Marketing for eCommerce: Customer Acquisition or Retention

STRATEGIC EMAIL MARKETING | HEATH WEAVER • 18 JANUARY, 2021 • 13 MINUTE READ

In this post, we’ll explore the purpose of email for eCommerce within your marketing mix, namely – is email most effective for new customer acquisition or for re-marketing to existing customers.

We’ll start by tackling the acquisition front.

Acquisition

When most people think about email marketing and customer acquisition, the first thing that comes to their mind is, “you mean, buying or renting email lists?”

It’s easy to see why people think this. After all, the direct response marketing industry relied heavily on direct mail prior to the web – which required purchasing segmented lists of prospects.

While this may be a viable strategy for very specific industries (if the email spam laws in your country allow list purchases) that have a high order value per new customer, we find this strategy to be terrible for eCommerce merchants in general.

Instead, acquire new customers with the following:

Web Platforms:

Your eCommerce Website
Facebook
Twitter
Pinterest
PPC
Sweepstakes/Giveaways

Strategies:

Information
Free eBook
Video Course
Buyer’s Guide
Discount
Free Shipping Coupon
Contests
Giveaways

There’s certainly an opportunity and strategies to grow your email list through active acquisition efforts and get new customers. If done correctly, you can see a positive ROI for your efforts.

That being said, in our experience, the most powerful property of (email) marketing for eCommerce is a customer retention channel.

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Retention

You are probably already familiar with the fact that the cost of acquiring a new customer is multiple times higher than the cost of retaining an existing customer (4-6x is a commonly cited statistic).

Luckily, as an eCommerce merchant, you can effectively use email marketing as a fabulous channel to win back your customers and extend their lifetime value.

Here are multiple ways email marketing can be used for retention purposes:

Communicating new promotions

This is the form of eCommerce email marketing most people are familiar with. Email “newsletters” involve various discounts, offers, and promotions of products, categories, or an entire website.

Alerting customers of new products added to your site

“New product” alert is another good way to use email communication to continue driving value for your existing customers.

Welcoming new customers

A post-purchase welcome series is a sequence of emails that onboard your new customers to your email list. This is a series we recommend all eCommerce stores have because of its role in serving multiple purposes:

It reaffirms your customer’s new purchase
It could potentially garner a quick repurchase. Many of the stores we’ve analyzed in the past have a high distribution of repurchases during the first few days post-purchase.
It sets your subscriber’s expectations
It gives your new customers multiple avenues to engage with your brand, helping indirectly to boost your visibility via social media for example.

Asking for reviews and feedback from customers

Product reviews on your website help sell your products. Using email, you can significantly increase the number of reviews you get by requesting them from your customers post-purchase.

Up-selling/Cross-selling related products

Depending on your product mix, you can identify particular products that are good candidates for cross/up-sales. You can then trigger automated emails a certain number of days after purchase to suggest specific product recommendations to your customers based on their latest order.

Reminding customers to re-order consumable items

Any consumable products will benefit from a product re-order trigger that is timed to hit your customers at the estimated time to re-order.

Reminding customers of abandoned carts

A cart abandonment email is a staple of any eCommerce email marketing program. These tend to convert well since they’re based on a strong buying behavior of placing items into a shopping cart.

Targeting customers based on their browsing behavior on your website

Several email service providers give you the option to target emails to subscribers based on certain URL visits on your website. If an existing email subscriber clicks on one of your previous messages, his/her page views will be tracked, and you can then hit them with specific emails based on pages viewed.

Common ways to utilize this data is by targeting categories, sub-categories, or even top-selling product pages visited.

Driving brand engagement with your social media properties

If you want to build up your brand’s presence on other platforms such as social media, you can utilize email to drive engagement with these channels.

Making special offers to your elite VIP customers

Segmenting out and giving special attention to your VIP customers will help you increase revenues from these “whales”. Additionally, since your top customers tend to also be your most likely brand advocates, you can recruit them in helping you get the word out about your store.

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Wrap Up

Given the multiple ways of utilizing email marketing for retention purposes, we see the email channel for eCommerce as mostly a retention marketing channel. Anywhere from 10% to 30% of total revenues can come from the email channel, depending on your brand, email initiatives, and repurchase rates.

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Heath Weaver
Managing Director, Principal
Heath Weaver has almost two decades of eCommerce digital marketing experience. He has run multiple agencies, headed up Search Engine Marketing for the consumer electronics division of Sony, and served as a Vice President at Trilogy Software. He enjoys working day-to-day with clients to level up their retention marketing game.