How Email Marketing Works

How Email Marketing Works

If you run a business on the internet, email marketing is a must-have. But if you’re new to online business, you may be asking:

“What’s email marketing?”

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Well don’t worry, we at Traffic Radius have created this blog especially for folks such as yourself. We’re here to tell you everything about email marketing that you could want to know: what it is, how it works, along with some helpful examples to help you really get to grips with it.

Email Marketing Defined

Email marketing is a digital marketing tool used to directly communicate to an established market. This communication can include updates, promotions, specials, content, and receipts. Email marketing puts you directly in touch with your audience, and allows you to specifically target people who have bought from you previously, increasing the chances that they will do so again. Simply put, email marketing capitalises on your existing audience, and encourages them to convert more.

The Ethical Side of Things

There’s no doubt that once email marketing is defined, its meaning can be fairly contentious. Ever since the internet was commercialised in the 90’s there have been questions and concerns regarding privacy and its invasion. With such a targeted method as email marketing, it begs the question, is marketing this way ethical?

Consent in cyberspace is very similar to consent in real space. If someone doesn’t want the thing, don’t force it on them. The difference between ethical, and unethical marketing is in what boundaries were crossed in the obtaining and use of information.

Ethical email marketing meets the following description:

• It lets the customer know what will happen by providing their email address.
• It leaves the power of choice with the customer.
• It aims to provide mutual value to the customer and the business.
• Any information gained about the customer through the course of the campaign is not shared with other companies without the customer’s express permission.
• It allows the customer to leave at any point and makes it simple and easy to do so.

Unethical email marketing works according to the following:

• Customer emails are obtained through a third party, or by a means that otherwise invades or pervades the customer’s privacy.
• It does not make itself known to the customer.
• It provides no benefit to the customer, only gratuitous and invasive advertising.
• Customer data is used to generate profit from other sources without consent.
• Customer data is made public without consent.
• Customers cannot unsubscribe without extraneous action, sometimes involving third parties or law enforcement.
• Communication channels were opened without the customer’s express permission.

The laws regarding spam can be found at the previous link, and outline exactly what people’s rights are when it comes to email privacy and email marketing.

Email Marketing in Action

Okay, so now we’ve covered what exactly email marketing is and addressed the ethical quandaries that may occur as a result of its use. Now we are going to go into the nitty-gritty of what it’s actually like to run an email marketing campaign.

Let’s say that your business is doing okay. You’re making regular enough sales that you’re never in the red, but you’re never totally safe either. You’re taking a look at your website’s analytics and finding that despite the apparent lack of sales, your website is getting a ton of traffic, both from new sources and repeat customers.

This is a fairly common situation among newer businesses, and email marketing is frequently the right tool to address it. In this scenario, the business owner has great traffic, and even some repeat customers, so there’s no reason to keep building an audience. The focus here needs to be on audience retention, in other words, lowering bounce rates, improving conversions, and maintaining channels of communication with customers. These can all be done via email marketing.

Using your metrics you find the item with the highest sale rate. Let’s say in this case you’re doing really well at selling frying pans. You decide on a period of 1-3 months, where whenever someone enters the “frying pan” section of your store, they’ll be greeted by a pop-up which allows them the opportunity to sign up for a mailing list, in exchange for 5% off any frying pan they buy. This means that your highest profit item is now also being used to establish further contact with your customers. If people are regularly buying pans from you, it’s likely that this is where your reputation lies, so it’s more than likely that this is where you’ll get the most people signing up for your mailing list.

Now your mailing list might start off small. Only 2 of 42 clients during your trial period might actually sign up. But during that period you should have been running various tools on your page such as CrazyEgg or Google Analytics in order to gain insight into how your customers experience your webpage. This will allow you to edit and to change or test things in order to gain more conversions.

Over time, more and more people will sign up to your mailing list, and before you know it nearly anyone who comes to your store is a repeat customer, using the deals, promotions, and special offers that you put out in your emails to make more purchases. New customers are even making use of the email list, figuring that if they’re going to make a purchase they might as well get a slightly reduced cost, and the landing page says they can unsubscribe if they want to so why not?

This is how email marketing works. It turns a passive audience into an active one because every sign-up represents someone who has seen value in what you’re offering already and then in exchange for signing up, you offer more value.

Until they interact with your email, it just sits in there, and more of them pile up every time you send out an email blast.

It’s a nice introductory offer for newcomers, increasing focus on your product and making your brand look generous. For return customers, it increases brand loyalty and the feeling of trust and commitment between you and them. This is what makes email marketing around 40% more effective than social media marketing, getting an average ROI (return on investment) of $44 for every $1 spent.

Traffic Radius

If you’re still not too comfortable with running your own email marketing campaign but think that you could benefit from it, why not contact Traffic Radius? Our friendly team of professional marketers have decades of experience in their fields, and with a client list of over 400 companies and small businesses, we are one of Melbourne’s most trusted marketing agencies.

You can contact us here at this page, or call us on 1300 870 901.