One of the biggest mistakes small business owners can make is not having an email marketing strategy.
Email marketing can keep your brand top of mind with the average consumer who checks their email daily (or several times throughout the day). Email inboxes is a channel you can’t ignore, and the key to successful marketing through this channel is relevance.
Today’s tools employ brilliant automation for this very strategy. You can send emails via automatic triggers based on what customers purchase or don’t, when they make returns, or other actions that shape messaging around where they are in the buyer’s journey. Sending the right message at the right moment can lead to more sales, more often.
This article covers the basics of email marketing for entrepreneurs in ecommerce and beyond.
From jargon definitions to basic email best practices and step-by-step how-to's, we'll cover everything you need to know to grow your brand and boost your sales.
What Is Email Marketing? A Definition
When you're looking to answer this question, you'll come across a few email marketing definitions. That's because email marketing is a broad term that covers many different ideas and activities.
Essentially, email marketing is a subset of internet marketing (also called digital marketing) that involves a business using email to:
- Promote its products and/or services
- Advertise and/or sell specific items
- Build and nurture relationships with potential or existing customers
Email represents an "owned" channel in your marketing mix. This means you maintain full authority over both the message content and how it reaches your audience. Unlike platforms controlled by outside companies, email gives you direct access to communicate with people without needing approval from third-party gatekeepers.
Benefits of an Email Marketing Strategy
When you focus on building an email marketing strategy that really caters to your industry and audience, you can reap some serious benefits.
- Low costs. In comparison to other promotional tactics like paid ads, running an email campaign is one of the best low budget marketing options.
- Huge reach and targeted leads. The nature and ease of email marketing mean you can reach hundreds, thousands, or even millions of high-quality leads just by clicking the "Send" button.
- High engagement. Especially when you send to people who have voluntarily opted-in to your list, you're sending direct messages to people who are interested in your brand. This email marketing contact strategy is gold for getting quality engagement.
- High sales, conversions, and ROI. Because your recipients are already interested, and you're (hopefully) sending them targeted messages and offers, they're more likely to make a purchase.
- Easy to implement. There are plenty of tools and platforms that can help you with developing, building, and launching an email marketing campaign without any coding expertise.
- Easy to integrate. It's just a few extra clicks to integrate your email marketing strategy with other efforts, like social media and content marketing.
- Easy to measure. If you use tracking and measuring functionality, you can know exactly how each email is performing. Many email marketing campaign tools and platforms have this feature built-in.
- Easy to track ROI. Once you know your KPIs and how much you've invested into each element of your email marketing strategy, it's easy to connect different tactics and the revenue they generated.
How Do Email Marketing Campaigns Work?
Generally, there are five key elements of email marketing strategies that work:
- Defining the purpose and details of each campaign and email before you build them
- Testing your finalized emails to make sure they're displaying as intended
- Sending emails out to your mailing list
- Measuring the performance using the right email marketing KPIs
- Reporting and analyzing your results to see strengths, weaknesses, and areas for improvement
Phases of an Email Marketing Campaign
I like to break down the email marketing campaign lifecycle into three main phases or segments: emails for prospects, first-time buyers, and repeat customers.
If a first-time buyer or repeat customer doesn't make a purchase for a while, they're considered lapsed (also called idle or latent).
Here's a visual of the types of emails that can be sent based on activity:
These broad segments, and their corresponding emails, apply best to an email marketing strategy for ecommerce. But when you take out the shopping element, it can apply to other types of businesses too.
Let's go over each of them briefly.
Prospects
These are people who have discovered your website but haven't made a purchase yet.
The ultimate goal is to turn prospects into first-time buyers, which can include emails like:
- Browse abandonment: When they were browsing your website but they stopped and left without making a purchase.
- New subscriber: "Welcome emails" for people who just joined your mailing list.
- Cart abandonment: When they have items in their shopping cart but didn't follow through to buy them.
When a customer makes a purchase, they become first-time buyers. You may wish to start an email welcome series to build a relationship.
First-Time Buyers
After they've made their first purchase, they're officially a first-time buyer.
Ideally, these customers will keep buying from you regularly and become repeat or loyal customers. However, in some cases, they'll become lapsed customers.
The goal here is to turn first-time buyers into repeat customers, which can include emails like:
- Cross-sell and upsell: Recommending different products to them based on their purchase.
- Feedback review request: Asking for input on their experience, so you can improve it for them and future customers. First-hand feedback is incredibly valuable, so get it whenever you can.
- Replenishment: Reminding them to repurchase items that need to be replenished regularly, like shampoo or vitamins.
When a customer makes their second purchase, they become a repeat customer.
Repeat Customers
Once you've gone over the hump of a customer making a second purchase, it's a great sign that they might stick around as an "active repeat" customer, or a loyal customer.
Just like the first-time buyer stage, you'll want to beware of the risk of them becoming a lapsed customer.
The goal here is to keep them around for life, which can be accomplished through the same types of emails that you're sending first-time buyers, in addition to:
- VIP: Special perks, offers, and appreciation for customers who have a high lifetime value.
When a certain amount of time passes after the last purchase from a first-time buyer or repeat customer (say, six months), they move to the lapsed customer phase.
Lapsed Customers
It's up to you to determine the time window for when a customer becomes lapsed. Businesses typically choose windows ranging from three months to a year.
You might also want to create different emails for different "levels" of lapse. This might show as one email for any customer who hasn't made a purchase in three months, another email for when it becomes six months, and another email for when it becomes a year or longer.
Emails to lapsed customers might include:
- Replenishment: Reminding them to repurchase past items.
- Win-back: Enticing them to come back to your site, like through a special offer or reminder.
The Power of a Returning Customer
Email marketing campaign segmentation like this is 100% mandatory for a good strategy. Not only does it help you personalize your communications, but it also helps you to identify the customers that are most valuable to your brand.
Research shows time and time again that businesses can make much more money by satisfying existing customers as opposed to spending all their resources and time on finding new ones. A powerful email marketing strategy during this phase can make a massive difference in your company's bottom line.
Now that you have a basic email marketing strategy checklist, let's discuss some of the legal issues that you need to follow.
Laws and Regulations to Look Out for
If you start getting reckless with your email marketing strategy and tactics, you won't just annoy (and potentially lose) important customers and contacts. You might also get yourself into legal trouble.
This is especially true after the European Union (EU) enacted the General Data Protection Regulation (GDPR) in May 2018.
Even US-based businesses still need to pay attention to the GDPR. This is particularly important if you're an ecommerce company that ships internationally. And of course, you'll definitely need to pay attention to the US email marketing campaign laws.
Let's go over some of the key requirements of the US's CAN-SPAM Act, the EU's GDPR, and Canada's CASL.
US CAN-SPAM Act
The 2003 CAN-SPAM Act applies to any business that's "promoting or advertising a commercial product or service through electronic communication." If you violate any part of the act, your business can be fined up to $41,484 per email. But don't worry, the rules are very straightforward and simple to follow.
1. Tell Your Readers Who the Email is Coming From
You must include your name or business name in your routing information and in your "From," "To," and "Reply to" labels. Your website domain name and email address must also be accurate.
For example, in their email marketing newsletter campaign, Coinbase writes "The Coinbase Team" as the sender, and sends the email from no-reply@updates.coinbase.com.
No confusion there.
While this is okay legally, I recommend ditching the "no-reply@" email address. It suggests that the sender wants to have a one-way conversation instead of engaging with their subscribers and customers. For bonus points, send your emails from the account of someone on your team, preferably customer support. That way, recipients can voice questions or comments, and you can show off your stellar customer service to strengthen the relationship.
2. Avoid Deceptive Subject Lines
Make sure your subject lines are an accurate preview of what the email actually contains. You can't have a subject line that says "50% Off Sale Today Only" and then the body of the email is just talking about your new product line, with no mention of a sale.
Sticking with the Coinbase example, their subject line is clearly related to the intent of the message: to help newbies learn the ropes of cryptocurrency.
3. Acknowledge That Your Message Is an Ad
The law gives a lot of leeway here. But generally speaking, if your message is an advertisement, you must disclose that it's an ad in a clear way that's easy to identify. The point is that readers can easily see that it's an ad and not a personal email from their sister.
You can keep it simple the way Coinbase does here:
4. Give Readers an Easy Way to Opt Out
The best way is an "unsubscribe" button or link at the bottom of the email, but you can also get away with listing an email address they can use to contact you to opt-out.
5. Tell Your Readers Where Your Business is Located
You must include your company's valid physical postal address. It can be your personal address, a post office box that's registered with the US Postal Service, or a private mailbox registered with a commercial mail receiving agency (that follows Postal Service regulations).
6. Honor Every Single Opt-out Request Immediately
You must opt them out within 10 business days, and you must be able to process opt-out requests for 30 days after each email is sent. If they choose to opt out of your email marketing campaign lifecycle, you can't require them to pay a fee or give you any extra information.
You also can't sell or transfer their email address to anyone, except to a business you hired to help you comply with the CAN-SPAM Act.
7. You're Still Responsible Even if You Hire Someone
If you hired a person or company to take over your email marketing strategy, monitor what they're doing. You're still legally responsible for all of their actions even if you're not writing and sending the emails yourself
If you'd like to learn more, check out this CAN-SPAM Act compliance guide from the Federal Trade Commission (FTC), as well as some candid answers to CAN-SPAM questions.
EU GDPR
You might recall a one or two-month period around April 2018 where your inbox was flooded with privacy policy changes from practically every international business you've ever given your email address to.
That was because of the GDPR.
The main purpose of the GDPR is to protect the data privacy of EU citizens. In a nutshell, it takes "ownership" of a customer's private data and shifts it back into the hands of the customer. It's not just about basic email marketing strategy. It's about any use of personal data.
Businesses that violate this policy can face fines up to a whopping €20 million, or 4% of their annual revenue, whichever is higher.
Of course, the GDPR was designed for EU businesses serving EU citizens.
But the thing is: if your business serves just one European citizen who's in Europe when you collect their data, you're subject to GDPR requirements.
This is why I recommend staying informed and playing it on the safe side. Not only would it cover you legally, but it would also help to make your data safer for you and your customers.
Since it's a fairly complex set of regulations, we'll just go over a few of the key elements as they relate to mass email marketing strategy.
Essentially, EU businesses must:
1. Get explicit consent before sending someone a marketing email
This is one of my biggest GDPR-related recommendations for US businesses: don't enroll anyone in an unsolicited email marketing campaign.
- Uphold an individual's rights, which include the "Right to Erasure" or the "Right to be Forgotten" by a company, and the right to have all of their information deleted forever "Right to Be Informed," or to know who's collecting their information and what they'll use it for.
- Report data breaches to the Information Commissioner's Office (ICO) in the UK within 72 hours.
- Make sure the average person can read and understand data policies, and that they're not hidden in the legal fine print that no one reads anyway.
- Hire a Data Protection Officer to help them comply.
- Ensure that any entity that processes customer data complies with certain requirements (not just the entities that control data, like the laws before the GDPR).
- Carry out a "Data Protection Impact Assessment" to look at high-risk activities.
Note: This is by no means an exhaustive list, and there are considerations and exceptions to what we've listed above. For comprehensive details on the GDPR, visit the European Commission's website.
Canadian CASL
Canada has its own regulations governing commercial electronic communications. The Canadian Anti-Spam Legislation was created to safeguard Canadian residents while allowing companies to remain competitive globally.
Similar to other regulations, CASL requires that businesses obtain permission before sending promotional messages. Companies must also provide clear identification and simple ways for recipients to withdraw consent.
If your business communicates with Canadian customers or operates within Canada, familiarizing yourself with CASL requirements is essential to avoid penalties and maintain good standing.
Conclusion
Without question, email is still an incredibly powerful tool to use to reach your customers.
You can reach targeted people, at exactly the right time, with personalized messages that are delivered right to their inbox.
Now that you've got an understanding of the basics of email marketing, get ready to start creating powerful email campaigns that will capture more customers.
Email Marketing FAQ
What Are the Advantages of Email Marketing?
Email marketing is an essential channel for any digital marketer and brand in general. It’s one of the most direct ways to reach consumers, especially given the fact that your email audience has likely opted in to hear from you on a regular basis. For the most part, email marketing isn’t very costly, and can be used to nurture valuable leads. It also tends to have higher engagement than social media and paid ad campaigns, though you may be reaching a smaller audience overall. One of the biggest benefits is that it’s easy to measure how well email marketing campaigns are performing, and you can easily track whether emails or flows lead to ROI.
What Are the Best Use Cases for Email Marketing?
As a pillar of digital marketing, email marketing is best used to promote products or services directly to a cultivated mailing list, build and nurture relationships with potential or existing customers who’ve opted into your email ecosystem, and stay top of mind in peoples’ inboxes, one of the most powerful channels in marketing today.
What Are the Legal Requirements for Email Marketing?
Before building your first email marketing campaign, it’s important to know the data laws surrounding collecting emails and other personal information and using them for outreach. The three major sets of requirements to learn are the US's CAN-SPAM Act, the EU's GDPR, and Canada's CASL.
How Do You Ensure Your Email Marketing Campaigns Are Compliant?
The key to email marketing under an ever-changing regulatory environment is transparency. Always make sure your readers know where an email comes from, and avoid deceptive subject lines. Acknowledge that your email contains an ad, and provide location information for your business. Give your recipients an easy way to opt out that’s clear and doesn’t cause friction, and honor every single opt-out request as soon as it comes in.