Those high-achieving oldest children—email subscribers who are active, engaged and likely to purchase—garner a lot of praise and interest. And a good amount of time is spent worrying about those rebellious younger children—those subscribers who have officially opted out.

But what about those who are technically subscribed to your emails, but are inactive and uninterested? These subscribers quickly delete your emails without reading them, but haven’t taken the effort to opt-out. It’s time to think about those middle children, or the “emotionally unsubscribed” as marketing blogger Joanna Lawson Matthew calls them.

Re-engaging Your Email Subscriber List

Matthew suggests first identifying those subscribers by segmenting your list to determine who hasn’t opened or clicked on any of your emails in a given timeframe, based on your email frequency. The next step is to re-engage those middle children, the emotionally unsubscribed group.

Matthew offers 3 ideas for doing so:

1. Send a series of 3-5 re-opt-in engagement messages to the emotionally unsubscribed group. Remind them of who you are and restate the value of your emails. When the re-engagement effort ends, remove anyone from your email subscriber list who hasn’t re-opted in. But be mindful that with this highly aggressive measure, you could lose a lot of email addresses—typically 70-75%.
2. Bring a sense of urgency to your email campaign. Think, “Your subscription will soon end! Act now to renew!” Communicate to the group that they will miss out on useful information and offerings if they don’t act quickly.
3. Segment the emotionally unsubscribed from your regular email subscriber list. Consider cutting back on frequency for this group and offering them a special whitepaper or free trial of your product. Or, send this group a survey to find out exactly what they want.

Re-engagement in Action

Perricone MD, a skincare products provider, is a terrific example of a successful email subscriber re-engagement effort. Before the campaign, many customers were no longer engaged or purchasing. Perricone MD experienced deliverability problems because those emotionally unsubscribed customers were driving up spam complaints.

To identify engaged customers and reconnect with dormant customers, Perricone MD:

• Worked with iPost to refine its use of Google Analytics, fully implement the strategy and train Perricone MD on using the analytics to create new email campaigns.
• Implemented iPost Autotarget™ to automatically identify the engaged and unengaged subscribers, based on their actual subscriber behavior, and segment the email subscriber list to reach out to each group appropriately.
• Increased the frequency of email to the engaged customers.
• Developed a “trial-size” offer program to entice the emotionally unsubscribed customers, the unengaged portion of the list.

As a result, Perricone MD increased its revenues and interaction from unengaged subscribers without risks to deliverability. Learn more about the re-engagement campaign in this case study.

How engaged and emotionally subscribed is your email subscriber list? Now may be the perfect time to consider a re-engagement strategy to help those middle children follow in the footsteps of their older siblings.

Share your thoughts on this concept via a comment.

The Perricone MD Case Study

At the Internet Retailer Conference & Exhibition’s email marketing workshop,  iPost customer Neil Kjeldsen, vp of ecommerce for Perricone MD, spoke on segmentation and gave a very actionable case study built around problem, solution and results (with actual specific numbers). Perricone MD is a prestige skincare company that was founded by Dr. Nicholas Perricone, a dermatologist, award-winning author, and anti-aging expert.

Neil Kjeldsen from Perricone MD speaking at IRCE 2009

Kjeldsen helped online marketers cut through some of the clutter and find a way to efficiently reignite relationships and sales from dormant customers. When Kjeldsen joined Perricone MD, he found that the vast majority of their customers were inactive – something that Perricone MD had in common with most companies. To make matters worse, these inactive customers were far more likely to opt out and flag Perricone MD as a spammer – hurting both the company’s ability to market to them in the future and Perricone MD’s email sender reputation with ISPs.

Kjeldsen’s solution was to adopt iPost as Perricone MD’s new email service provider (ESP) and to implement the iPost Customer Engagement Program, a combination of strategic services, processes and software. Kjeldsen said that iPost first worked with Perricone MD to analyze their email, web analytics and purchase data. Perricone MD then implemented iPost’s Autotarget, which automates and updates daily Recency, Frequency, and Monetary value (RFM) segmentation.

Using Autotarget to automatically group customers into micro-segments, Perricone MD divided customers into engaged and unengaged segments. First Perricone MD started mailing safely (engaged customers tend to have very low opt out and spam complaint rates) to the engaged customers and tested a variety of methodologies to see what best improved revenue and  campaign profitability.

Perricone MD next worked with iPost to develop a “trail size” promotion for the unengaged customers and began mailing to them in “safe” segments.  The safe segment approach is central to iPost’s Rapid Reputation Repair process and enables e-tailers to mail to questionable lists without damaging their email sender reputation. According to Kjeldsen, in one month Perricone MD was able to implement and optimize the engagement programs. Because Autotarget automatically segments customer data daily, Kjeldsen said he and his team found that it only took them 5 minutes per mailing to use Autotarget.

Kjeldsen's presentation made a clear case for actionable analytics

Kjeldsen stated that the results from the iPost Customer Engagement Program included:

• A huge increase in conversion rates (from 0 to up to 33 percent)
• A dramatic jump in revenue per email sent from $0 to $0.26
• Growth in online revenue from unengaged customers from 0 to 7 percent

The Bandwagon

Amusingly, another ESP in the session presented a case study on the benefits of RFM that used data from another iPost case study on the Eastwood Company. To work around the fact that it was actually an iPost case study, the vendor referenced a DMNews article from October 2008. I encourage you to check the article out!

The ESP’s pundit, also, told the audience that RFM is – as a process – very easy to do, something that Kjeldsen countered when he got up to speak. Kjeldsen said that he used RFM analysis in previous jobs and loves Autotarget because it makes RFM easy and that without Autotarget RFM is simply not easy for small and mid-size teams.

The Workshop in General

I found the presentations to be far better at the workshop than the general sessions. The presenters came across far more knowledgeable but were still not consistent in highlighting quantitative results and making it clear what all is involved (time and resource) to achieve those results.

Last year at Internet Retailer, email marketing seemed to be treated as the bastard stepchild of the online marketing world. The event organizers kept it out of the limelight and few speakers acknowledged doing something so pedestrian and “yesterday” as email marketing. Most e-tailers I met at IRCE 2008 were either satisfied with blasting out emails or were just thinking of dipping their toes in the email marketing waters. Online marketers were somewhat intellectually interested in email analytics and segmentation but were not emotionally revved to do something about them.

What a difference a year and a recession make! Not only did email marketing more often find its way into session presentations but most online marketers I spoke with wanted to take their email marketing to the next level, even if they weren’t fully clear on what “next level” meant for them. I also far more agencies who wanted to improve email marketing for their clients and C-level execs who wanted to understand the potential of email marketing.

The sessions – sadly – were generally worse than last year and reflect poorly on Internet Retailer. Most of the presentations in 2008 did not have metrics nor did they necessarily reflect sophisticated business savvy but they at least were professional. This year most of the one I saw seemed to be thrown together. For example, on session on email marketing messaging was put on by an email service provider and an e-tailer. They promised practical advice that attendees could put into practice but everything was vague and general. Missing in action were metrics and practical processes. For example, the big takeaways from the session included have a call to action (CTA) and make your emails relevant. Ok.

I would like to see Internet Retailer take a pledge to only have speakers who

1. Share the specific results of their programs and

2. Give attendees an idea of how much time and effort is involved to achieve the stated results

In small and mid-size companies the whole online marketing team has too many things on their plate as is. They usually need help prioritizing – given their resource constraints – on what will help them best move the revenue needle. A lot of things are interesting or worthwhile but few can do them all.

In the current economic climate, the shrewd email marketer has an opportunity to be the hero who helps the business stay afloat and even thrive. While many email marketers long to be able to segment their lists into thousands of mini-segments to conduct true one-to-one marketing, now is the time to stop dreaming and get practical.

In my iTiki bylines I give advice on such topics as:

• Practical segmentation means a better bottom line for the holidays
• Learn to say “No” – or at least “Wait” – to discounts
• Thriving for the holidays mean putting on hold your dream of true one-to-one marketing

Brian Krebs of the Washington Post reported recently on a study by University researchers in California that dissects some of the economics of spam email. Although it presents a sobering picture of the gullibility of the average email recipient, it also suggests that the return on a spammer’s email blast is much lower than previous estimates. It takes about a billion messages to get a return of less than $10,000.

This has contributed to a renewed discussion of “email postage,” that is, the idea of charging a fee for every email message, similar to the USPS and other postal services charging for every physical letter. If it cost as little as ¹/₁₀₀ of a cent to deliver each of those billion messages, proponents say, all spammer profits would be wiped out and it would no longer be worth their while to flood the net with junk. At such a tiny rate, postage bills for ordinary users would total less than a few dollars, and usually only a few cents, per year, and could be absorbed into the fees already paid for internet access, so only senders of millions of messages would even notice.

Another advantage to a “sender pays” model of email is that it might suddenly become very expensive to have your personal PC taken over by malicious software and turned into a “spam bot.” A few days after Krebs reviewed the UC research, he also reported on the takedown of McColo Corporation, an ISP that appears to have been hosting the command controls for a large number of bots. Almost immediately following McColo’s loss of connectivity, sites that monitor the volume spam reported that the amount of junk email reaching their sensors had fallen by 30% to 75%. Clearly botnets are a huge contributor to the spam problem, and anything that helps to identify compromised PCs and encourages cleaning them up, is a good thing.

Unfortunately, spam reduction isn’t a sufficient incentive to put an email postage system in place. Ignoring the technical hurdles involved in organizing reliable payment for “stamps” and preventing forgery or re-use of stamp tokens, consider the shift in attitude that would inevitably accompany an imposition of fees by an ISP when accepting email.

In today’s email infrastructure, the majority of the cost is borne by the recipient’s mailbox provider. ISPs and other providers owe nothing to the senders of email; they charge the recipient, either directly or by sprinkling their user interface with advertising. Consequently the provider has no obligation, and no incentive aside from maintaining the goodwill of their users, to provide reliable delivery of email that originates outside their own network.

An email postage system would turn that on its head. When you put a stamp on a letter and turn it over to the postal service, you have both a belief and and expectation that the post office is going to do its job and carry that letter to the addressee. Would it be any different if you bought that stamp for an email message?

Accepting payment from the sender of an email obligates the ISP to make a best effort to get the message into the recipient’s mailbox. The ISP becomes liable to both the sender and the recipient if a system failure results in the loss of paid email. No more silent acceptance of email which is then discarded undelivered, and maybe no more junk folders unless each mailbox owner creates his own personal set of junk rules. A strong expectation that anyone willing to pay the full postage rate should be exempt from delaying tactics like greylisting and rate-limiting.

I don’t think ISPs are prepared to take on that responsibility. I think they’d rather stay right where they are, in complete control of what they allow on their networks and free from real obligations to provide reliable email delivery. Right now they’re the good guys, valiantly defending their users from the relentless siege of an army of baddies. Postage would be tantamount to taking bribes to let the baddies in; consider the (largely misguided) fracas that resulted when AOL announced a partnership with Goodmail. Does a tiny fraction of a cent per email outweigh the cost of implementing a postage system and marketing it to the users?

I’d like to be wrong about this. What are your thoughts? How would you react if you had to pay postage for your email?