Retargeting Emails – Do E-commerce customers like or loathe them?

By Charles Nicolls, SeeWhy

At SeeWhy, when we first launched our remarketing service in 2009, Randy Stross wrote a piece about email remarketing in The New York Times suggesting that while remarketing might be a great idea for ecommerce websites, it’s not a great idea for consumers. He likened emails following up on abandoned shopping carts to a salesman chasing you down the street if you didn’t buy from his store.

There are major differences, of course. We’ve long argued that remarketing emails, when done well, not only drive conversions but also build brand trust.

They can deliver great service and provide customers with the confidence to return to buy—either online, by phone or in store. If Randy was right and customers universally resented the intrusion, then these emails wouldn’t work.

In aiming to answer the question more substantively, I turned to data, and specifically email marketing benchmarks.

The key metrics to look at to determine whether customers like or loathe remarketing emails are:

1. the recovery rate
2. the open rate
3. the clickthrough rate
4. the unsubscribe rate

Frankly, the evidence is overwhelming: Remarketing, when done well, is appreciated by customers. Here’s the evidence:

(1) The recovery rate

The recovery rate is the percentage of visitors that abandon shopping carts, and remarketed visitors thatthen return and purchase following remarketing. At SeeWhy, we measure recovery rates across all our customers, and currently the average is 20 percent.

So, one in five shopping cart abandoners come back and buy, having being remarketed. In some cases, the recovery rate is as high as 50 percent. Moreover, when remarketed customers buy, they spend on average 55 percent more than customers who didn’t abandon their shopping carts.

(2) The open rate

The average email open rate for remarketing emails is currently 46 percent, more than double the benchmark open rate of 22 percent for all email campaigns. Email open rates are higher for remarketing campaigns simply because they are more relevant — remarketing emails are triggered by visitors’ actions (such as abandoning a shopping cart) and sent individually, rather than typical ‘email blast’ campaigns.

The data also shows that most abandoned shopping cart emails are opened multiple times. When opened, the average remarketing email is opened 2.2 times and clicked through 1.6 times. For some ecommerce sites, remarketing emails are opened as many as four times on average.

What this means is that visitors who abandon their shopping carts are keeping these emails in their inbox and going back to them. We know that consumers often use shopping carts to ‘bookmark’ items for a future purchase while they research their purchases, and remarketing emails make this much easier.

Customers appreciate a direct link back to their shopping cart where they’ve saved the items they are considering.

(3) The clickthrough rate

The clickthrough rate measures the proportion of shopping cart abandoners that refer back to the website by clicking on a link in one of the remarketing emails.

Aggregate data shows that on average 15 percent of recipients click through, approximately three times higher than the benchmark for all email campaigns. In some cases, we see remarketing emails getting clickthrough rates as high as 60 percent. The clickthrough rate can vary significantly from site to site and also within sites over time, in particular where a promotion is used.

It’s important to note that the email clickthrough rate is an imperfect measure — some customers will return by typing in the site name, mistrusting links in emails; so it is important to measure the true return rate as well, not just the clickthrough rate.

(4) The unsubscribe rate

The unsubscribe rate measures the proportion of shopping cart abandoners who subsequently unsubscribe from future shopping cart reminders. The email unsubscribe rate currently averages 0.19 percent and is typically lower than industry averages for opt-in subscriptions (0.25 percent). This suggests that abandoners are happier to receive shopping cart reminder emails than a typical house mailing.

So on balance, we have to conclude that email remarketing, such as following up on abandoned shopping carts, web forms and applications — when done well — provides value to customers. In this case, it definitely looks more ‘like’ than ‘loathe.’

Tells us what you think. like or loathe?

About the Author

Charles Nicholls is Founder and Chief Strategy Officer of SeeWhy, blogger, ecommerce visionary, and author of ‘The Top Ten Converting Websites’ and ‘In Search of Insight.’

Recognizing that traditional Web Analytic approaches are limited to historical analysis, Nicholls founded SeeWhy in 2003 to make ecommerce more relevant to individual visitors and customers through real time web analytics. Nicholls, a 20-year veteran of the software industry in the US and Europe, is internationally recognized as one of the preeminent thinkers in the Analytics space. In 2003 The Massachusetts Institute of Technology selected Nicholls as a global leader in Intrapreneurship following his highly innovative creation of Business Objects Analytics. In his role as an advisor to leading companies globally, Nicholls has worked with many of the world’s top companies on their web and customer analytics programs, including Amazon.com, Ebay, Lands End, MasterCard and a many smaller companies.