Cross-Channel Marketing Study highlighting new opportunities for engagement

Discover what consumers think of personalized messages (and why marketers aren’t delivering) in Cordial’s new cross-channel marketing study filled with insights from consumers & marketers, examples of brands getting it right, and exclusive eCommerce benchmarks.

KEY TAKEAWAYS:

• SMS represents incredible, largely untapped potential
• Marketers can improve performance by sending fewer, yet better messages
• 89% of marketers feel they are creating a unique experience for each customer, but only 34% of American consumers who shop in response to emails from brands, say that most of the emails they have received from brands in the past 6 months have been personalized

Content Summary

Introduction
The state of customer engagement
The text opportunity
Marketers getting it right, part one
The personalization perception
The challenges of creating a truly personal, cross-channel experience
Marketers getting it right, part two
New opportunities for engagement
Focus on what matters

Introduction

Old approaches to engaging customers are simply not enough anymore as consumers expect recognition and value in every interaction. The very nature of what it means to make a personalized connection has evolved with rising consumer expectations and with the data available to marketers to use. Ultimately, to really connect with consumers today across channels requires turning messages into experiences, and then turning those experiences into relationships.

The Cordial Cross-Channel Marketing Study set out to shine a light on how marketers can do just that by exploring what motivates consumers, what approaches marketers are taking now, and how messaging strategies need to evolve.

KEY FINDINGS

• A gap exists between what consumers want from brand communications—and what marketers think is good enough.
• There is incredible value in customizing content based on individual actions. Consumers who feel the messages they receive are personalized, are nearly twice as likely to purchase based on an email or text received.
• SMS represents incredible, largely untapped potential, and should be viewed as a core part of the buyer journey—especially when marketing to Gen Z.
• Messaging campaigns and triggers driven by specific customer behaviors represent opportunities for marketers to drive exponentially higher revenue and lifetime value. In other words, marketers can improve performance and loyalty by sending fewer, yet better messages.

ABOUT THE DATA

• Consumer survey data from an online survey of over 2,000 U.S. adults conducted by The Harris Poll on behalf of Cordial
• Survey data from over 550 U.S. marketers
• Ecommerce benchmarks based on more than 30 billion messages across 285 million consumers

The state of customer engagement

In 2020 with the rise of COVID, the great digital shift affected consumers in myriad ways. One of the most notable, however, was the increase in online sales and adoption of eCommerce, even in consumers who were previously hold-outs. Now, perhaps not surprisingly, we found that 93% of American consumers say they’ve shopped online. We also found that 47% shop online always or often, compared to 53% who say they shop in-store with the same frequency.

47% OF CONSUMERS SHOP ONLINE ALWAYS/OFTEN

53% OF CONSUMERS SHOP IN STORE ALWAYS/OFTEN

The great digital shift

Consumers also shared that the pandemic is a reason why they have shifted their shopping behaviors. Nearly 6 in 10 Americans who shop online (59%) said that they significantly or slightly increased their online purchasing during the pandemic with nearly a quarter (23%) saying that their online purchasing significantly increased. Online shoppers ages 18- 34 (63%) are more likely than online shoppers ages 65+ (53%) to say that their online shopping increased.

59% OF AMERICAN CONSUMERS WHO SHOP ONLINE INCREASED THEIR ONLINE PURCHASING DURING THE PANDEMIC

Just as consumers say that they are shopping more online since the pandemic began, marketers agree. Brands are experiencing rising online sales over the last year as a function of COVID and more than half of the marketers we surveyed (56%), say that their eCommerce sales have increased over the last year—with 16% saying that sales have increased significantly.

MARKETER SURVEY DATA: CHANGE IN ECOMMERCE SALES OVER THE LAST YEAR

• 16.5% increased significantly
• 40% increased somewhat
• 36% no change
• 6% decreased somewhat
• 2.5% decreased significantly

Consumers are open to new brands

Consumers are not only engaging in online shopping to a greater degree since the pandemic began, but they are also more likely to engage with and buy new brands. With the rise of new direct-to-consumer brands and the rise of eCommerce, consumers have options and they are willing to engage with brands they have never heard of before who pique their interest and meet their needs in new ways.

Now more than ever, marketers must embrace opportunities to build trust with their customers.

60% LIKELY TO PURCHASE A PRODUCT FROM A BRAND I’VE NEVER HEARD OF BEFORE

Millennials and Gen Z are opting in

Consumers have not only increased their adoption of online shopping during the pandemic, but they are also seeking out more information to help with their shopping ventures online and off—which is a clear opportunity for marketers. 30% of American consumers who shop in response to emails from brands said they signed up to receive more emails from brands during the pandemic than they did before, and 31% who shop in response to text messaging offers from brands said they signed up to receive more text messages from brands during the pandemic than they did before. This includes more than half (53%) of men aged 35-44 and nearly half (46%) of parents of kids under 18 who signed up to receive more text messages from brands during the pandemic than before.

30% OF CONSUMERS SIGNED UP TO RECEIVE MORE EMAILS FROM BRANDS

31% OF CONSUMERS SIGNED UP TO RECEIVE MORE TEXT MESSAGES FROM BRANDS

Email and SMS are high-growth marketing channels

Just as consumers shared that they were more willing to sign up for messages from brands over the last year, marketers noted growth in email and SMS subscriber acquisition in the last year.

61% OF MARKETERS GREW THEIR EMAIL SUBSCRIPTION LIST

49% OF MARKETERS GREW THEIR SMS SUBSCRIPTION LIST

Brands took advantage of this list growth, sending more messages to their customers. More than half of marketers said the number of emails they sent to subscribers grew in the last year and more than a quarter of those marketers said the number of emails sent to each customer increased more than 25%.

With the increased email and text message volume, marketers have seen the value in increasing the number of sends. Looking ahead to next year, a majority, 82%, of marketers say they plan to increase the number of emails they send to subscribers and three-quarters said they plan to increase the number of text messages they send to subscribers.

82% OF MARKETERS PLAN TO INCREASE THE NUMBER OF EMAILS THEY SEND TO SUBSCRIBERS IN THE NEXT YEAR

75% OF MARKETERS PLAN TO INCREASE THE NUMBER OF TEXT MESSAGES THEY SEND TO SUBSCRIBERS IN THE NEXT YEAR

Are consumers truly engaged?

How are consumers engaging with the emails and texts they sign up for? Well, they indicate that they are open to receiving emails and texts, but the infrequency of their engagement with the messages may be a sign that they’re simply not getting what they want.

A vast majority, 83%, of consumers say they have shopped in response to emails from brands, and 67% say they’ve shopped in response to text messages from brands. However, while consumers are willing to engage and make purchases based on the communications they receive, doing so may not yet be the norm.

Only 15% of consumers say they always or often shop from emails from brands and only 13% say they always or often shop based on the text messages they receive from brands. Far more consumers respond tepidly: they only sometimes shop in response to emails (43%) and texts (29%) from brands.

83% OF CONSUMERS HAVE SHOPPED IN RESPONSE TO EMAILS FROM BRANDS

67% OF CONSUMERS HAVE SHOPPED IN RESPONSE TO TEXTS FROM BRANDS

The text opportunity

“Though email is still key for marketers, interest in receiving text messages is on the rise. Roughly one third (31%) of consumers who shop in response to text messaging offers from brands signed up to receive more text messaging offers from brands since the onset of the pandemic, and more than one-third of consumers (37%) plan on subscribing to additional text messaging offers now due to concerns that the COVID-19 Delta Variant will limit the ability to safely shop in stores this upcoming holiday season.

Consumers recognize when a brand is delivering messaging that is tailored to them, and are increasingly allowing marketers into their mobile phone, especially in the 35-44 age range. As the text is an impactful marketing channel, marketers must increase the level of personalization in the small amount of real estate they have on a mobile phone screen. By customizing content based on the real-time actions customers take, marketers can deliver text messages with the utmost relevance, which is crucial to this channel.

The text shouldn’t be considered a new part of the promotional mix, it’s a key part of the buyer journey and a core channel that shoppers view as part of their experience with a brand. For retailers, the continued uptick in SMS subscriptions means it’s more critical than ever to fine-tune their cross-channel approaches and consider the types of messages consumers expect to receive via text.”

Gen Z doesn’t just communicate through text, they transact

“It is well-known that Gen Z is a mobile-first generation and both Gen Z and Millennials are digital natives, but it’s important to call out that they not only want to communicate via mobile, but they are also likely to transact via mobile. Nearly 8 in 10 (78%) of 18-34-year-olds and 74% of 35-44-year-olds purchase in response to text messages they receive from brands.”

78% of 18-34 year olds purchase in response to text messages they receive from brands

Marketers getting it right, part one

Let consumers identify their preferred channel

Nurx uses its email and web channel to encourage users to opt into SMS and download their mobile app. Understanding that not all consumers are the same, Nurx allows their customers to select their communication method. This also creates mutual value for Nurx and the customer—Nurx can collect more data on each customer, and their customers receive their preferred channel of communications.

The personalization perception

“So what’s the barrier? We know emails and texts are effective, and consumers are willing to shop via these channels. Consumers need and expect value and something unique in all communications. An Epsilon study found that the appeal of personalization is high with 80% of respondents saying that they are more likely to do business with a company if it offers personalized experiences.

While personalization has been top-of-mind for retail marketers for some time now, only 34% of American consumers who shop in response to emails from brands say that most of the emails they have received from brands in the past 6 months have been personalized (i.e., they seem to be tailored to my specific needs and interests) and another 13% simply aren’t sure. The same applies to text messages from brands with only 38% of consumers who shop in response to text messaging offers from brands saying most of the messages they received from brands in the past 6 months are personalized.

The reality is that the very definition of personalization has evolved. Consumers expect true personalization using the information they have shared and actions they have taken. But many marketers are still approaching personalization with the same approach from a decade+ ago.

Successful email execution goes beyond “batch and blast” email sends with A/B tests sprinkled in between. Triggered messaging informed by consumer behaviors, like site browsing, abandoned cart, and product recommendations increase customer loyalty and drive sales.”

AMONG CONSUMERS, 34% MOST OF THE EMAILS I’VE RECEIVED IN THE LAST 6 MONTHS HAVE BEEN PERSONALIZED (13% NOT SURE)

AMONG MARKETERS, 50% MOST OF THE EMAILS WE’VE SENT IN THE LAST 6 MONTHS HAVE BEEN PERSONALIZED

The challenges of creating a truly personal, cross-channel experience

Without data, there can be no personalization

Nearly three-quarters of marketers, 74%, cite obstacles to sending email and text messages that are highly personalized. Twelve percent of marketers say “we’re unable to access the data we need when we need it”, and 14% cite data formatting, agreeing, “we can’t use the data we have without time and effort to prepare it.” Others struggle with resources and skills.

• 74% of marketers cite obstacles to sending email or text messages with more personalization
• 25% Lack of resources: wwe have too much else to do
• 14% Data formatting: we can’t use the data we have without time and effort to prepare it
• 12% Lack of experience: our team lacks the skills we need
• 12% Data access: we’re unable to access the data we need when we need it
• 10% Platform: our current vendor makes it hard to do what we want

Access to data is critical to being able to make a real connection with consumers. The more granular the data that marketers can use, the more unique and personal the messages will be for consumers which, in turn, are more likely to engage them and breakthrough.

The risk of disconnected experiences

Many marketers also need to rely on multiple platforms and data sources to send emails and text messages to customers. Only 24% of marketers say they can send email and SMS through just one platform while 35% say they need three or more platforms to send messages.

35% OF MARKETERS NEED THREE OR MORE PLATFORMS TO CREATE AND SEND EMAIL AND TEXT MESSAGES

The future requires flexibility

To deliver a consistent and connective customer experience, marketers must choose technology platforms that play well with others. Neither a world of disparate UIs and customer data silos nor one where a single marketing cloud solves all of a marketer’s problems will do the trick. Marketers want to work with stellar platforms in eCommerce, content management, advertising, social, and cross-channel marketing that plays nicely together: real-time customer and business data living in multiple platforms at once, where it can be activated in the best possible way. Furthermore, no vendor can provide custom integrations with every single best-of-breed martech solution. The future is flexibility—in APIs, data portability, no-code data transformation, and similar tools.

The real-time imperative

Perhaps as a result of disconnected technologies and data challenges, many marketers are still not able to achieve real-time personalization with their email programs. Only a third (33%) of marketers say that they can achieve real-time personalization, personalizing on all the audience, attribute, and behavior data they have in real-time. Only 23% of marketers say they can achieve real-time personalization with their text messaging programs.

Yet, despite the lack of real-time personalization, marketers still feel that they are creating a unique experience for each customer through email and SMS. A strong majority— nearly 9 in 10 marketers (89%)—feel they are creating a unique experience for each customer. Yet, harkening back to the consumer data, it is clear that the experience that marketers think they are creating isn’t necessarily landing with all consumers.

89% AMONG MARKETERS “WE FEEL WE CREATING A UNIQUE EXPERIENCE FOR EACH CUSTOMER THROUGH EMAIL AND SMS”

34% AMONG CONSUMERS “MOST OF THE EMAILS I’VE RECEIVED IN THE LAST 6 MONTHS HAVE BEEN PERSONALIZED”

Marketers getting it right, part two

Make it personal

Revolve pulls in 16 unique data points from the Cordial platform to personalize their product recommendations for each user. As a result, personalized recommendation emails are 2X more productive than batch messages, and equate to 65% higher click-to-open and click-to conversion rates. Sent regularly, the Revolve team expects this email to generate hundreds of thousands in incremental revenue.

16 Unique Data Points:

• Abandonded browse
• Currently hearted
• Favorite category
• Similar items (to browse history)
• You may also like
• New favorite designer
• Also purchased (based on orders)
• Abandoned cart
• Saved for later
• New arrivals by price
• Brand affinity buyer
• Best sellers by state
• Best sellers by state and country
• Best sellers in the last 365 days
• Best sellers in the last 7 days
• New arrivals
• Best sellers by country
• Best sellers

New opportunities for engagement

In this section, we’ll explore anonymized, aggregated data from a subset of Cordial clients in eCommerce to highlight where and how brands can use customer data to improve the long-term health of their business.

A better message is personal, relevant, and intelligent

In 2007, Harvard Business Review published an article titled “If Brands Are Built Over Years, Why Are They Managed Over Quarters?” written by Leonard M. Lodish and Carl F. Mela which discussed the proliferation of point-of-sale scanner data in the 1980s. This near-real-time data sparked a renaissance of retail marketing science (and relational databases to boot), but scanner data eventually led to an overabundance of promotional discounts. Marketers delivered absolute revenue growth in the short term. However, over the long term, customers modified their behavior in anticipation of those promotional discounts. In addition to diluted brand equity, brands suffered worsening margins, as competitors and mass-market discounters raced to the bottom.

Today’s cross-channel marketers face the same challenges in even more complex situations—think COVID-related supply chain delays, third-party eCommerce channel conflict, the emergence of DTC brands, and see-saw changes in consumer shopping behavior. And like the first generation of “real-time” marketers, more aggressive sends with more aggressive discounts can drive more absolute revenue in the short term. In the long run, though, marketers risk violations of customer trust and dilution of valuable brand equity.

Real-time data platforms, programmatic triggers and automation, and advanced data models help turn the tide by allowing marketers to send fewer—but better— messages and improve customer lifetime value through higher revenue, reduced churn rates, and improved gross margin.

Begin with behavioral triggers

Well known to most marketers, triggered messages, prompted directly by customer behavior, drive higher Revenue per Thousand Messages (RPM) than promotional “batch” messages—regardless of personalization. Through basic triggers, such as browse and cart abandonment or subscription reminders, marketers can drive 6-7x RPM versus promotional messages.

OVERALL RPM AS % OF TRIGGERS & AUTOMATIONS INCREASES

In general, brands that shift more of their message volume to triggers and automation deliver outsized RPM results. Marketers with more than 20% of their message volume allocated to triggers and automation generate almost 5x RPM, compared to marketers who send less than 10%.

Send a better message, not another message

Bucking conventional wisdom, promotional messages don’t have to drive the lion’s share of revenue for brands. While promotional campaigns have their place in the awareness funnel, top quartile Cordial clients index more highly on triggers and automations, generating 58% of total attributed revenue on 19% of overall message volume.

Furthermore, by sending fewer, more targeted messages, cross-channel marketers can also reduce subscriber churn and protect their list for the long term.

Finally, marketers can also drive higher average order value (AOV) through the use of triggers. Triggers drive a 43% AOV lift on average and a 29% AOV lift for the median Cordial client. By targeting full-price sales such as new product alerts and high-margin add-ons or recommendations, marketers can drive more than just top-line results. Once supply chain data exists in a cross-channel marketing platform, marketers can optimize for gross margin as a KPI through machine learning.

Looking loyal

Your email and SMS subscriber lists and mobile app active users are at the heart of customer retention strategies. And those repeat customers are even more responsive to triggers and automation than promotional content.

For first-time orders attributed to email, triggers drive a 42% lift in average order value (AOV) versus a promotional messaging baseline. These triggers are driven by the power of retargeting, often for browse and cart abandonment.

For repeat purchases, the outcomes from trigger strategies are even more impressive. While repeat AOV drops by 20% in promotional messages (likely due to the ever-present coupon or sale), repeat AOV for triggered messages increases by 154% over the original baseline.

Treat your repeat customers like you know them, and they’ll reward your efforts.

Drive RPM lift through additional data modeling

Once standard trigger programs are in place, expanding to advanced audience segmentation, predictive engagement models, and improved personalization helps drive additional revenue and improve the message mix.

Loyalty and lifetime value segmentation, brand affinity recommendations, or back-in-stock alerts (driven by ever-more critical supply chain data) are all possible using data tools within Cordial, and clients see RPM lift of 30-80%+ across all performance quartiles. On average, advanced data models drive more than 2x higher RPM across all messages and almost 3x higher RPM for triggers.

USING ADVANCED DATA MODELS:

• 30 – 80%+ OVERALL LIFT IN RPM
• 2X HIGHER RPM ACROSS ALL MESSAGES
• 3X HIGHER RPM FOR TRIGGERED MESSAGES

Focus on what matters

“One might not expect that the release of a new Apple operating system would reignite one of the oldest debates in email marketing, but the release of iOS 15 in September 2021 has done just that. For many years, email marketers have simultaneously decried the usefulness of open rates and click-through rates on email while also using those same metrics to determine the success of campaigns, the engagement of their subscriber lists, and the overall performance of their organization.

iOS 15 turns open rates on their head for any Apple Mail user on an iPhone. By pre-fetching, email content, and obfuscating the source and timing of email open, email marketers’ raw open rates for campaigns will look dramatically higher without any sort of reporting filter. And evaluations of “customer engagement” based on open rate may drive more automated sends to non-engaged users, increasing unsubscribes and lowering retention/lifetime value. Marketers and marketing technology vendors are scrambling to create more appropriate comparisons between periods and more accurate engagement metrics by deep evaluations of iOS 15 behaviors—that may or may not be held consistent over time.

Rather than litigating that debate, Cordial recommends that marketers return to first principles while taking advantage of the benefits of cross-channel marketing and next-generation data platforms. It’s never been about email clicks or opens. It’s about connection.

Encouragingly, 81% of marketers agree that the industry-wide privacy changes will help marketers focus on more meaningful engagement metrics. Marketers can and should define the KPIs that most matter to their business, and use software that can optimize for the performance of any KPI against content, channel, or creativity.

Not every campaign is a conversion campaign that requires optimizing for Revenue per Thousand Messages (RPM), but downstream indicators such as web sessions and page views per user may be better tools for evaluating awareness in the first place.

More importantly, data platforms (like the one in Cordial) listen for more real-time customer behaviors than just an email open. This allows marketers to connect that data across all message types and all channels creating the potential for purpose-built, brand-specific Customer Engagement Scores (see sidebar). By converting promotional campaigns to triggers and automation using programmatic and predictive engagement models, marketers can generate more than 2x higher RPM across all messages.”