Email is widely used by brands for local marketing, and they consider it one of their most effective tactics. But privacy concerns and new email consumer features may threaten the channel’s utility. And while using email well aids in achieving some marketing objectives, it’s not the driver that newer technologies are, indicating brands could use a little help syncing it with other marketing and advertising programs.
Nearly half (45%) of the multi-location brands Street Fight surveyed last year said they used email regularly to support their local branches, franchises, and distributors. Over one-third (34%) listed it among their top 5 marketing tactics, making email the overall top tactic, as shown in the figure below. A 2017 survey from the Data & Marketing Association confirms that email had the best ROI, in terms of lowest cost per acquisition, of the media types it asked about.
But the EU-mandated General Data Protection Regulation (GDPR) that rolls out towards the end of May is making marketers re-confirm consumer permissions, and could result in a thinning out of email marketing lists. At the same time, recent updates to the most popular email software, Gmail, could weaken consumer consumption of newsletters and other marketing content. Gmail’s one-tap unsubscribe and refined sorting features could prove a mixed blessing for brands. The consensus seems to be that marketers need to beef up their personalization to maintain email effectiveness.
In Street Fight’s analysis of best practices in local marketing by brands, we asked decision-makers to rate their digital effectiveness at various marketing objectives. The figure below illustrates the share of respondents who said their efforts were “very effective” at a given goal. The green bar shows the overall response rate, and the orange bar represents the share of the group that had email in their top 5 tactics list. The comparison shows that effective emailers were modestly better than average at some objectives. They were 15% to 20% better at customer support and retention, and a little better than their peers at increasing conversion or sales. In some cases, fewer than average called their digital efforts “very effective”—notably for raising brand awareness.
This doesn’t mean that using email makes a company worse at branding. In fact, when we compared the sum of responses saying “effective” as well as “very effective,” the effective emailers were generally a little better than their peers. But those positive correlations aren’t nearly as pronounced as they are for brands that had geotargeting or streaming video in their top 5 most effective tactics list. Brands could likely boost overall digital effectiveness via better campaign integration and more sophisticated use of customer information.
Here are some other characteristics of the effective emailer group that should be useful to providers of marketing technologies and services in marketing to and supporting brands:
- They’re pretty good target customers for digital marketing: Over a third (36%) said they were increasing the local mix of their digital spending, with 14% saying they were doing so significantly. They’re doubling down on email, as a well above-average 47% said they were increasing email spending. Over half (51%) said they were increasing social media budgets and 46% were raising mobile spending.
- Besides email, their most effective tactics were direct mail and their local sites. They were markedly more likely to list those, and paid search, in their top 5 most effective list than the average multi-location brand. They also liked traditional print advertising. They had success with their social media company pages but less with paid social ads.
- Unsurprisingly, more of the effective emailers used custom codes and coupons to measure marketing effectiveness, but they were also more likely to use point-of-sale data as well. And they appear a little more sophisticated in their use of techniques like marketing mix modeling and multi-touch attribution. Otherwise, their use of management tools was similar to other brands, though 29% said they used a DMP.
- The effective emailers appear to be more centralized than their peers, making more of their digital marketing technology and spending decisions at headquarters rather than in local offices or with shared responsibility. Like their peers, their marketing departments tended to own customer data authority, with customer service and sales having a role, and advertising generally the second most important input. They’re above-average deployers of POS info across multiple campaigns, and perhaps overly reliant on customer surveys. Like their peers, proving ROI is their most difficult digital marketing challenge, but they also seem to struggle with managing multiple sources of customer data.
- The new technologies they are most interested in exploring are a similar group to that of other multi-location brands—mobile push marketing and real-time location data. But somewhat more of the effective emailers are interested in next-generation POS systems and in AI analytics.
With local email marketing widely established, its best practices may have become a little stale. Agencies and marketing tech providers can help brands improve on personalization with better social media integration. Adding DMP capabilities, or supporting ones already in place, could ease customer information confusion and boost re-targeting, using input from search and local site behavior. In the face of sexier technologies like messaging and social media, email still has tremendous staying power. So helping brands incorporate it alongside digital and traditional marketing tactics won’t be a wasted effort.
David Card is Street Fight’s director of research.
Click here for more on the Street Fight Insights report, Enterprise Local Marketers 2017: Benchmarking and Best Practices.