Download Transactional and operational messaging

Transactional and
operational messaging:
Marketing when it matters most
An Experian CheetahMail white paper
May 2005
Executive summary
Triggered, real-time messages are a vital component of a
comprehensive and successful email marketing program
In this era of ever-changing buying habits and newly regulated telemarketing
and email solicitation, it has become increasingly difficult to deliver the right
message to the right customer at the right time. Gone are the days of
marketing to the masses through one discernible channel, when customers
were forever loyal and retention was virtually guaranteed. Today, the task of
engaging customers is far more arduous, often requiring non-traditional email
tools that enable you to market precisely when it matters most.
Transactional and operational messaging, also called triggered or event-based
messaging, is as powerful a tool as it is underappreciated. Simply put, every
order confirmation, shipping notice, receipt, cancellation, order change,
warranty reminder, registration confirmation, abandoned shopping cart,
subscription expiration, and profile change becomes an HTML marketing
vehicle to personalize, brand, promote, cross-sell and up-sell other products
and services to an attentive and already engaged customer.
The impact of transactional/operational messaging on response and revenue
statistics has been dramatic. According to Forrester Research, event-based
emails are 17% more likely to be opened than newsletter or promotional emails,
and customers are 20% more likely to click through on them. They are often read
multiple times, and are usually last to be deleted. Additionally, Jupiter reports
that transactional and operational messages result in 3% conversion rates (of
those with open rates of less than 22%), well over the conversion average of
other direct marketing programs. CheetahMail response data from transactional/
operational campaigns supports these findings, as you will see in the recent
case of a Fortune 500 resort and entertainment provider (see Opportunities
section). However, even with these proven results, only 20% of marketers say
they use transactional/operational messaging as part of their overall strategy
(Jupiter, “Effective Email Marketing” 2004).
The document highlights the marketing opportunities in HTML transactional
and operational messaging, explains how the event-based messaging process
works, and gives recommendations for optimal deployment.
© 2008 Experian CheetahMail, Inc. All rights reserved.
According to Forrester
Research, eventbased emails are
17% more likely to be
opened than newsletter or promotional
emails, and customers
are 20% more likely to
click through on them.
Opportunities
Looking at appropriate scenarios for implementing
transactional messages
If executed correctly, transactional and operational messaging can be one of
your most effective marketing tools. Below are just a few examples of how
CheetahMail’s event-based messaging (EventMailer) can be implemented:
Order confirmations and shipping notices
Sending highly personalized HTML order confirmations in real-time can
create additional revenue opportunities from already engaged customers. Order
confirmations and shipping notices list not only the details of each order, but
also dynamically generate the customer’s name, inserts complementary product
offerings and discounts related to the purchase, and relevant brand equity
(taglines, logos, descriptions, etc). When the product is shipped, another similar
marketing message is triggered and delivered in the form of a shipping notice.
Below is a comparison of a generic confirmation vs. a CheetahMail-enabled one:
© 2008 Experian CheetahMail, Inc. All rights reserved.
Abandoned shopping cart
Event-based messaging gives companies an opportunity to re-engage shopping
cart abandoners. Yankee Group estimates that as many as 77% of users have
abandoned a shopping cart at least once in their lives. With CheetahMail, an
abandoned shopping cart can trigger a real-time email (which could also include
a survey) to the prospect that promotes the product and offers him/her an incentive to purchase. It also provides an opportunity for the marketer to reinforce the
benefits of the abandoned item encouraging the completion of the transaction.
Lost/forgot password
Since immediacy is vital for lost password requests, event-based messaging
system must be robust in its delivery. Failing to send real-time lost password
requests often results in lost opportunity and revenue, as prospects click over
to other sites rather than waiting. As with order confirmations, lost password
requests can pitch complementary offers.
Other uses include:
• Registration/Subscriber Confirmations
• Cancellations and Updates
• Profile Changes
• Warranty notices
Personalization
Personalization has been a marketing buzzword for several years, and with good
reason. According to AMR Research, personalization in direct marketing accounts for a 30% uplift in sales as compared to the average uplift of less than 1%.
Personalization can be much more than simply inserting a recipient’s first or last
name. For example, it can be tied to geography, as in the case of a retailer who
wants to include an in-store promotion as part of an online registration expiration notice (using zip codes for proximity). It can also be tied to the cross-sell
offer and the sales pitch. With CheetahMail’s dynamic content capabilities,
customers receive the content, images and offers that are most relevant to them.
Revenue generation
The ability to cross-sell and up-sell is probably the most important attribute
of transactional/ operational messaging. Unlike direct mail, which could take
weeks to arrive on your doorstep, event-based messaging is instantaneous and
performed while customers are still connected and in “buying mode” (with credit
card in hand). Reaching these customers at this point in time with graphicallyintense cross-sell/up-sell offers has proven itself to be a low-cost revenue generator. The following real-life scenarios exemplify a couple of the many cross-sell
and up-sell opportunities available to email marketers:
• Leading online electronics retailer sends an HTML order confirmation in
real-time to a digital camera purchaser. Using variable dynamic content and
CheetahMail’s EventMailer, the retailer includes an offer on camera accessories, such as storage cards, camera cases and printers. Additionally, the
email contains different discount offers on each accessory.
• Upscale fashion retailer sends a triggered shipping confirmation to a
customer who recently purchased an overcoat. The HTML email thanks the
patron for their business, and includes a 15% discount on designer gloves
and hats.
© 2008 Experian CheetahMail, Inc. All rights reserved.
Personalization can
be much more than
simply inserting a
recipient’s first or last
name. For example, it
can be tied to geography, as in the case of
a retailer who wants
to include an in-store
promotion (using zip
codes for proximity).
• Leading financial services firm shows a prospect who abandons a shopping
cart right before he confirms the opening of a Roth IRA. This abandonment
immediately triggers an email that explains the tax benefits of Roth IRA
compared to other investment choices, as well as the advantages offered
by the financial services firm itself (no fees, etc).
Revenue generation case study
One CheetahMail client, a Fortune 500 hotel management company, recorded
an open rate of well over 100% with transactional and operational messaging,
as guests were found to refer back to their email confirmation for room details
and days. Each time a guest opened the confirmation was another opportunity
to up-sell additional nights and cross-sell amenities, such as entertainment at
the specific property, restaurants and spa activities. As a result, the client sold
an additional 500 rooms per month, generating nearly $300,000 in additional
monthly revenue – all from what used to be simple text-based order confirmations and lost password reminders.
Brand reinforcement
Every communication with customers should always reinforce your company’s
brand and message, particularly in the case of order/shipping confirmations,
cancellations, and forgot password requests, as they are widely opened and
read. Colors, fonts, taglines, and logos should remain consistent with the website or offline marketing campaign. HTML creative enables this kind of branding
in your email communications. Using text-based emails for these important
messages costs marketers opportunities to emphasize their brand during the
entire customer lifecycle.
HMV’s optimized order confirmation
messages had a conversion rate that was
19X higher than its standard promotional
messages.
Reduced call volume
Reducing call volume is a priority for many organizations, as it contributes to
a considerable percentage of CRM costs. Since transactional and operational
messaging is fully automated and sent in real–time through CheetahMail’s
EventMailer, the sales order process is greatly improved and customer service
costs are reduced. Customers can be immediately informed that their order has
been placed, when it has shipped, and when to expect delivery. This realtime
communication process reduces the number of customer service calls and
inquiries.
Other Benefits
Dynamic messaging
With the CheetahMail EventMailer and dynamic content integration, repetitive
tasks, such as making sure the appropriate complementary offer is delivered
and the correct customer name is listed, are now fully automated and dynamic,
saving considerable development time and eliminating any chance for human
error. A completely automated process also decreases the amount of Marketing
and IT resources required to handle data uploads and modifications. These valuable resources can now be reallocated to other revenue-generating projects.
Call-center integration
CheetahMail’s API/EventMailer system can also be seamlessly integrated with
a client’s call center to minimize the resource time required to address customer
inquiries related to products and services. For instance, as in the case of one
CheetahMail client, the EventMailer system automatically sends customized
product quotes to prospects who have just spoken with a customer service rep
in the call center.
© 2008 Experian CheetahMail, Inc. All rights reserved.
Reporting
All of the reporting metrics and testing offered through CheetahMail’s standard system are made available for transactional and operational messaging,
including sent, bounce, open, click-through and transaction activity. In regards
to testing, each event can be assigned to one of ‘n’ different sets of mailing
content (“A/B/…split”) for the purpose of testing the relative effectiveness of
new content.
Delivery monitoring
As event-based messages are often the most important email messages sent,
CheetahMail uses delivery reporting to track delivery on each message. This
allows CheetahMail clients to know if each message was not delivered and then
utilize other methods to contact this customer (i.e. call and ask for an updated
email address).
Right offer at the right time
Finally, transactional/operational messaging enables marketers to collect business intelligence, make content relevant, test marketing promotions, and deliver
the right offer to the right person at the right time.
© 2008 Experian CheetahMail, Inc. All rights reserved.
How does it work?
Explaining the nuts and bolts behind CheetahMail’s transactional messaging system
EventMailer / API Diagram
1
Customer
3
Website
2
4
CM Event Mailer
The EventMailer, part of CheetahMail’s comprehensive emarketing platform,
is comprised of a proprietary lightweight API system. An API, or Application
Program Interface, is a set of functions that define the way in which one piece
of software communicates with another. In this case, the communication is
between the CheetahMail database, the client’s website and the customer.
The process of setting up an event-based mailing consists of four steps:
• Definition of an event (order, ship, etc) in the CheetahMail system
• Definition of mailing content in the CheetahMail system
• Setting up the API call to trigger the event
• Associating the event with the mailing content to generate a mailing
Definition of an event
Every event has a name and unique identifier (event ID), which connects API
calls to mailing content. The specific event is identified in the API call, and mailing content is associated to an “event” in the CheetahMail system. Therefore,
when an API call is received by the system, it looks up the associated content
and uses it to generate the message. This mapping allows the client to change
the mailing content without having to change the API call.
1. Customer makes online purchase
(event occurs)
2. Website returns ‘Thank You’ page
3. Website generates API call to CM
Event Mailer
4. CheetahMail sends response
(confirmation) to customer based on
preset parameters
• Customer receives email and responds (opens, clicks, etc)
• All response and delivery data is
tracked and reported in real-time
When an API call is
received by the
system, it looks up the
associated content
and uses it to generate
the message. This
mapping allows the
client to change the
mailing content
without having to
change the API call.
© 2008 Experian CheetahMail, Inc. All rights reserved.
Definition of mailing content
Mailing content is defined in the CheetahMail event mailer system in a manner
very similar to that used for setting up mailing content for other promotional
communications or newsletters in CheetahMail’s Standard Bulk Mail system.
Setup of API call
The API call follows the standard CheetahMail API conventions. Access credentials in the form of a cookie are required. The call to the system also specifies an event ID, target email address, optional source (affiliate) identifier, and
optional personalization/variable content parameters.
Association of event with content
An event is associated with mailing content in the CheetahMail System.
Optionally, the events can be assigned to one of ‘n’ different sets of mailing
content based on a pseudorandom function (“A/B/…split”), e.g. for the purpose
of testing the relative effectiveness of new content.
Advantages of CheetahMail EventMailer system
• Dynamically inserted content for precise targeting
• Formatted messages (HTML, etc.) – multipart
• Text, HTML, multipart, and AOL-adapted formats supported
• Marketing (cross-sell, up-sell) within message (marketing when it matters)
• Link tracking
• Open tracking
• Full reporting (including roll-up and delivery at the customer level)
• Testing capabilities (nth-ing) and comparison reports
• Easily change and tweak message/product/offer/creative for optimal results
• To maximize security, variable/personalization data is transmitted to
CheetahMail using an encrypted link (SSL/HTTPS), and removed from the
system as soon as the email is sent
© 2008 Experian CheetahMail, Inc. All rights reserved.
CAN SPAM compliance issues
While CheetahMail encourages you to review these
definitions and differentiations with your legal counsel
before engaging in event-based messaging, we can offer
some guiding principles for you to consider when deploying
these types of messages.
Transactional messaging only
The CAN SPAM Act exempts transactional messaging from the law’s commercial compliance requirements, such as the need for a commercial or postal
identifier as well as the need for an opt-out request. CheetahMail’s flexible event
based-mailer system respects these exemptions for transactional messaging
clients and enables clients to choose whether to include these elements in their
transactional messages. Of course, all of other CAN SPAM Act messaging
requirements of transmission and sender integrity remain and are maintained
throughout our processes.
Mixed transactional/commercial messaging
In December of 2004, the Federal Trade Commission clarified the definition of
commercial email by its ‘primary purpose.’ With respect to transactional or relationship messages combined with commercial content, the compliance requirements for dual purpose messages include three main elements:
1. If any part of the subject line of an email includes commercial content, then
the email message is a commercial message. Here’s an example:
One important
element of the CAN
SPAM Act of 2003 is
that it clearly defines
and differentiates
between transactional
or relationship
messaging and
commercial messaging.
• Transactional subject line: Shipping notification from Merchant.com
• Commercial subject line: Shipping notification and a great offer from Merchant.com
2. If the transactional or relationship messaging content is not at or near the beginning of the body of the message and is significantly preceded by commercial
content, then the message would be considered commercial.
• Note that it is still perfectly acceptable for a transactional message to
include rich HTML templates and content, including the use of a ‘sidebar’
with commercial cross-sell and up-sell offers as previously indicated in the
whitepaper.
3. Finally, if the commercial content of an email message ‘overwhelms’ the
transactional or relationship content, then the message could be considered
commercial.
Each of these three principles comes with the understanding that it is up to the
‘reasonable recipient’ to determine if the subject line, header, or overall message’s primary purpose is commercial or otherwise. Please consult with counsel
or email [email protected] with respect to complete CAN SPAM Act
interpretations and commercial compliance requirements.
© 2008 Experian CheetahMail, Inc. All rights reserved.
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About Experian CheetahMail
Experian CheetahMail is the trusted service
provider of online marketing solutions for
top enterprises worldwide. Offering
industry-leading email marketing and
customer intelligence solutions, as well as
providing a broad range of client services,
Experian CheetahMail enables clients to
build data-driven, relevant relationships
with their customers. Servicing the world’s
most recognizable brands, Experian
CheetahMail’s globally diverse client base
includes Barclays, Borders Books, Discovery
Communications, H&R Block, KLM, Sears
Holdings Corporation and Wyndham Hotels.
Experian CheetahMail, a business unit of
Experian® Group plc (LSE:EXPN), was
founded in 1998 and is headquartered in
New York City with offices in Los Angeles,
San Francisco, London, Dublin, Amsterdam,
Paris, Barcelona and Melbourne.
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