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20 Visionary Ideas to Futureproof Your Email Program Email in 2020? Think Email 20/20 Instead It’s easy to make predictions. Search “Email 2020” and you’ll get back loads of results predicting what the digital world will be like in a few years. Some of them are probably spot on, while others may be wildly inaccurate. Truthfully, there is no crystal ball that will allow you to predict what the future holds. So how do you position yourself today to ensure future success, regardless of what the future holds? By surrounding yourself with great data. With data, you can gain insights that will help shape the future of your email program. By looking back on past results and analyzing current trends, you can use that data to prepare your company for what is coming. Rather than focusing on what email will look like in the year 2020, you need to shift your focus to developing 20/20 vision—or better!—when it comes to your email program. In this report, we explore 20 visionary ideas on what the future of email will look like based on our data-backed 20/20 vision. Email 20/20 2 returnpath.com Email Marketing in Focus Email 20/20 3 returnpath.com Email Marketing in Focus Email is everywhere. People use it daily in both their work and personal lives to send documents, share updates, register for online accounts, and more. While not as visible as social media and TV commercials, it quietly but effectively produces the highest ROI of any marketing channel. According to Venture Beat, mid-sized businesses receive an average of 246 percent ROI from email marketing. So despite what some “thought leaders” may suggest, email is not dead—nor is it dying any time soon. In fact, email is more prevalent than ever and is constantly changing, developing, and producing rich data. Email provides a direct connection to individual people and contains multiple elements that can be fine-tuned to create a unique experience. In the future, both email marketers and mailbox providers will change how they interact with email. Mailbox providers will develop stricter filtering policies so you will need to take advantage of your data to develop engaging email experiences that will land in the inbox. 01 With the adoption of IPv6, domain reputation will be a major factor in filtering decisions. For those of you who aren’t intimately familiar with how IP addresses work, most of the world is using what’s called an IPv4 address. However, with the amount of internet enabled devices in use today, we are quickly running out of numbers to go around. Just as the addition of new area codes allowed for an exponential expansion in phone numbers, IPv6 contains more numerals in the address, allowing for more addresses to be created. With its new configuration, the amount of IPv6 addresses available will be greater than the amount of stars in the known galaxy. So what does this mean for email marketers? The adoption of IPv6 will provide a wealth of IP addresses that spammers can—and will—exploit. Rather than being tied to one IP address, once an IP address begins to experience reputation issues, a spammer can simply move on to a new IP address. To keep spammers out, mailbox providers will increasingly rely on domainbased reputation to judge incoming mail and marketers will need to maintain a pristine reputation to pass their filters. 02 All mailbox providers will incorporate individual level engagement into their filtering decisions. Senders will need to start monitoring and increasing the engagement of individual subscribers in addition to the overall engagement of their list. Some mailbox providers are already incorporating individual engagement into their filtering decisions with great success. Going forward, both the number of mailbox providers using individual level engagement and the weight they place on it will increase. To help boost their engagement, marketers need to use email and consumer data across various sources to personalize every aspect of an email including send time, campaign cadence, and email content. Email 20/20 4 returnpath.com In 2020, there will be more than 3 billion email users worldwide, which will account for nearly half of the world’s population. (Radicati) 03 04 List hygiene will play a major role in reputation and filtering. List hygiene is a significant component to a sender’s reputation. As mentioned earlier, mailbox providers are becoming more strict about the content they allow in the inbox. Having an unclean list—full of spam traps, unknown users, and unengaged subscribers—is viewed as the trait of a spammer and messages from that sender will likely be filtered to spam. Designing and executing customer experience/journey will be essential to maintaining customers long term. Using historical data, email marketers will be able to identify consumer preferences that they can incorporate into the email experience. Identifying what subject lines, content, send time, frequency, etc., resonate most with customers will allow email marketers to create unique experiences that showcase the value of maintaining an email relationship. 05 Marketers will continue to shift budget from traditional marketing and into digital marketing. According to recent research by Salesforce Marketing Cloud, marketers are spending more than two-thirds of their marketing budget on digital promotions. This budget percentage is predicted to increase particularly for email marketing with 87 percent of marketers planning on increasing their email marketing budget. Marketers need to begin shifting their focus more towards digital marketing, allocating budget to the channel that will produce the highest ROI. 06 Email 20/20 Markets will invest heavily in tools and tech to optimize operation. Part of the increase in digital budget will go toward acquiring new tools and tech that will help marketers optimize their marketing efforts. The best marketers are already using various tools and tech to support their efforts, but with the creation of new companies and platforms every year that address new needs, marketers will consistently add and alter the tools in their existing configuration to create an optimized email program. 5 returnpath.com Customer loyalty is valuable—increasing customer retention by 5 percent can lead to a 25 - 95 percent increase in company profits. (Harvard Business Review) 86.7 percent of companies plan to spend more money on email marketing in 2016. (Email on Acid) More than 90 percent of delivered messages come from reputable senders. (Return Path) The volume of emails sent in a day is expected to reach to 257.7 billion by 2020. (Radicati) Email 20/20 6 returnpath.com 20/20 is Not Good Enough Email 20/20 7 returnpath.com 20/20 Is Not Good Enough Email as a channel is under attack. As highlighted in Verizon’s 2016 Data Breach Investigations Report, email has become the weapon of choice for cybercriminals, with phishing trending up and leading to more data breaches than ever before. Email fraud impacts companies of all sizes and across all sectors. It erodes consumer trust in your brand, negatively impacts your email program, and exposes your organization to unprecedented risks. To avoid making headlines and position your company for the future, you will need to use data to look beyond what is readily visible in order to anticipate and defend against attacks to your business, brand, and bottom line. 07 08 All unauthenticated emails will be blocked from the inbox. The future will see only legitimate emails make it to consumer and enterprise inboxes, thereby removing the guesswork for users. Organizations that have not implemented the strongest level of email authentication will see their legitimate email programs affected by this change. Brand awareness and ROI will be negatively impacted. Customer security will become a top priority for organizations across all industries. Customers are increasingly aware of cyber threats and are now making buying decisions based on how securely companies protect their data. In the age of the customer, companies with a known history of security breaches will lose out to their competitors, making email fraud protection a necessity. 30 percent of phishing messages were opened by the target across all campaigns, up 30 percent from 2015. 12 percent of users went on to click the malicious attachment or link, up 9 percent since 2015. (Verizon) Email 20/20 8 returnpath.com 09 Securing the email channel will become a joint charter for CISOs and CMOs. A fraudulent email attack can destroy a brand’s reputation in seconds—and the road to recovery is a long one. The future will see security professionals partner with brand champions—marketing leadership—to protect customers and to maintain customer trust. CISOs and CMOs will work together to advocate for strong email security. 10 We will see complete convergence between enterprise and consumer email filtering technologies. Rather than relying on people as the first and last line of defense, mailbox providers and businesses will implement strong authentication protocols to power filtering decisions across consumer mailboxes and enterprise security gateways. 11 Companies will need to have preventative measures in place to avoid skyrocketing cyber insurance premiums. Not only do customers view security breaches unfavorably, insurance companies are penalizing businesses that do not take security seriously. To protect their business from high premiums, security professionals need to secure the email channel with strong authentication, locking down one of the most vulnerable threat vectors. 12 CBO Email 20/20 Every enterprise company will add a Chief Brand Officer (CBO) to their c-suite. A CBO is essentially the customer experience advocate. Their chief concern is to ensure the company is providing a valuable customer journey and to address anything that might negatively impact the brand experience. While most companies strive to create a worthwhile offering, customer experience is often secondary to quarterly goals and budget concerns. Giving the responsibility of the overall brand image to a c-level executive will allow businesses to place a higher priority on promoting and defending the brand image and experience. With a CBO advocating for the image—and having the authority to be heard— businesses will become more efficient in adopting new practices and policies that will protect their brand. 9 returnpath.com More than half of internet users get at least one phishing email per day. (Phishing.org) 97 percent of people globally can’t correctly identify a sophisticated phishing email. (Intel) Customers are 42 percent less likely to do business with you if you are being targeted by a phishing attack, regardless of whether or not they are actually getting tricked into giving up their information. (Cloudmark) Email 20/20 10 returnpath.com Foresight is 20/20 Email 20/20 11 returnpath.com Foresight is 20/20 In the future, marketers will be able to predict customer purchase behavior with stunning accuracy. To accomplish this, marketers will need access to more data— and the right data—as well as the ability to analyze it and extract meaningful insights in real time. Today, most companies struggle to make the most of the limited data to which they already have access. A 2014 report by KPMG found that 96 percent of business executives acknowledge they could do more with big data. The same report found that 86 percent of companies identified one of their greatest challenges as implementing the right solutions to accurately interpret data. Confirming that notion, Forrester research estimates companies are only analyzing about 12 percent of the data they have. Simply collecting data isn’t enough. Business leaders are shifting their focus toward more data-driven insights to unlock the value of the untouched 88 percent. Companies are investing in data science as well as new technologies capable of distilling actionable intelligence from raw measurements. To prepare for the future, you will need to streamline the ways you ingest, visualize, analyze, and ultimately operationalize data. As data becomes more manageable, you will gain confidence that strategies are aligned with and responsive to an ever-changing business landscape. Ultimately, bottom-line results will speak for themselves. 13 Companies will discover new value in email data. Email is a rich data source with value beyond marketing. From online and offline receipts to travel itineraries and brand preferences, the inbox is becoming a go-to source for business intelligence. By analyzing email data, strategic executives will predict trends, improve targeting, and discover competitive intelligence that will impact the business beyond the email channel. 14 In the short run, purchase and transactional data will supplement other Voice of Customer (VOC) initiatives (e.g., surveys and focus groups). Surveys and focus groups can only measure what the customer might do, or what they think they do. Purchase and transactional data shows what customers actually did. By supplementing survey results with actual purchase information, such as receipts and shipping confirmation, marketers will be able to more accurately predict future consumer behaviors. 15 Email 20/20 In the long run, real-world data will supplant traditional VOC methods. As businesses collect data and build robust customer profiles, surveys will no longer be a valid measurement of customer intent. Rather, with the wealth of second and third party data available, businesses will create profiles based on past purchase decisions to model accurate predictions of what customers will buy at their store. 12 returnpath.com An estimated 40,000 exabytes of data will be collected by 2020 compared to the collection of 2,700 exabytes in 2012. (IDC) B A C D 16 Contextual marketing will force greater collaboration between companies that gather customer journey information. Companies will work together and share data in order to expand their reach. When companies share and compare customer data profiles they have individually developed, they learn more about customers and are able to make more meaningful connections. Contextual marketing will empower companies to reach customers like never before. Having the right data is the critical first step. 17 Businesses will use second party data to develop more accurate customer profiles. Data cooperatives will provide businesses with access to large networks of second party data collected from various sources. The addition of second party data will allow companies to build more accurate and scalable customer profiles than those they can create with their own proprietary data. 18 Companies will continue to invest in in-house data analysis/science teams. While outsourcing data analysis has been effective in the short-term, going forward, businesses will need to have their own in-house teams capable of ingesting and analyzing massive data sets. In-house data scientists will both speed up the process and help focus the output of data analysis. Internal teams of experts will also be able to guide executives so they can make datadriven decisions in a timely manner. 19 Inventory management schemes like “just-in-time” will become more precise and will factor in competitor inventory levels. Access to more data and faster processing times will increase the accuracy of inventory predictions. Knowing where, when, and what customers are buying—not just at their store but at neighboring stores as well—will allow businesses to create a more strategic operations plan that increases sales and limits excess undesirable inventory. Email 20/20 13 returnpath.com The average increase in profits from big data investments is an initial six percent followed by nine percent for investments spanning five years. (McKinsey) Big data investments amounted to 0.6 percent of corporate revenues and returned a multiple of 1.4 times that level of investment, increasing to 2.0 times over five years. (McKinsey) The data volume in the enterprise is going to grow 50x year-over-year between now and 2020. Email 20/20 (Hadoop Summit) 14 returnpath.com Avoiding a Data-Blind Future The future is unknowable, which brings us to our final prediction... 20 The future will be very different than anyone expects A prediction can only be so accurate. Fundamentally it is still an assumption of what might be—not what will be. With so many unknown variables in play—some of which don’t even exist yet—some of our predictions will likely turn out to be wrong. (Hopefully, just this one.) As this last prediction is the most accurate of them all, what is the real takeaway from all this? Now is the time for marketers and organizations to determine how they will use data and analytic power to promote and protect their brand. Although some are trying, this opportunity hasn’t been fully captured yet because doing it properly requires organizations to think differently about their investments. Email 20/20 15 returnpath.com A Clear Vision for the Future Rather than predicting the future—or worse, passively waiting for it to come—businesses need to constantly look forward at what’s coming and use their knowledge of the past and the present to prepare. Below we share some examples of how data visionaries are meeting this challenge: To provide an exceptional email experience and prepare for the future, one online home improvement retailer used predictive intelligence to get their email marketing in focus. With our Send Time Optimization tool, they uncovered the best time to send a campaign based on the personal preferences and past email activity of their subscribers. By identifying the optimal time to connect with their customers, the home improvement retailer achieved a 32 percent lift in opens and a 33 percent lift in clicks. Email 20/20 Swedish online marketplace Blocket sought to go beyond 20/20 vision by implementing a DMARC reject policy to identify and protect against unseen threats. After implementation, Blocket saw a dramatic reduction in suspicious messages, from 2.7 million in December 2014 down to just 13,700 three months later—a 99 percent reduction. In addition, customer service tickets relating to email phishing dropped by 70 percent. 16 In order to enrich existing data sets and provide a clearer picture of consumer preferences and market trends, market research firms are incorporating Return Path’s item-level receipt data. This unique and detailed data allows research companies to provide clients with unprecedented levels of analysis to better understand customers, competitors, and markets. returnpath.com