Lift Your E-mail Performance: Move to an Affordable Top-Tier ESP

If you’re not currently using a top tier e-mail service provider (ESP), here’s a reason to consider moving to one: a lift in your metrics. It’s a phenomenon that’s well-known in the e-mail marketing world; when you shift to a top ESP from a second-tier ESP or an in-house solution, you usually see an immediate and sustained jump in your opens, click throughs, and other metrics.

I got to experience this again firsthand earlier this month, when I helped a client move from a proprietary in-house system to one of the best-known (but not terribly expensive) ESPs. Here’s an overview of some client results, based on how the same control piece performed when sent to the same house list, month over month.

Increased Open Rate

We had been testing things to lift the client’s open rate for some time, with limited success. I knew we should get a boost from the new ESP, but the results were even better than anticipated. Just 72 hours after the send, we had a 93 percent increase in open rates over the previous month’s control, which was sent from the old system. This took the client from an open rate significantly below the industry average for untargeted campaigns (20 percent, according to JupiterResearch) to a spot within spitting distance of the open rates garnered by highly targeted click-stream campaigns (33 percent).

Increased Click-Through Rate

As phenomenal as the lift in open rates was, click-through results were even better. Month-over-month CTR (define) on the call-to-action links (I suppressed the other links from this analysis; you’ll learn why later) increased 171 percent. That’s not a typo — we more than doubled, and nearly tripled, the percentage of clicks the call-to-action links received.

We still have a long way to go. Even with this increase, the figure remains below the 9.5 percent industry average for untargeted broadcast campaigns reported by JupiterResearch (which is what I shoot for, even though you can be successful without getting there). But it’s a start, and it’s a bigger lift than we’ve seen in a while from our testing.

Increased Conversion Rate

The increased open and click-through rates are nice, but if they don’t result in an increase to your conversion rate, who cares? The good news is we did see a lift in the conversion rate. While it’s not as dramatic as the other increases — only 13 percent — the client was excited. And since this analysis was done just 72 hours after the send, we expect to get a little more lift before all is said and done.

JupiterResearch reports average industry conversion rates of 1.1 percent for untargeted broadcast e-mail campaigns. This client’s conversion rate is still below average, but that’s OK because we’re beating its internal goals for leads generated. Last month’s control generated 47 percent more leads than were budgeted. This month, the control has exceeded the goal by 78 percent just 72 hours after the send. I’m hoping to hit double the leads it wants and exceed the goal by a full 100 percent before it’s all over; I just wonder when the powers-that-be will catch on and give us even higher targets to meet!

Increased Bounce Rate

Although the results above are spectacular, not all was rosy with this first send from the ESP. The client felt it had been diligent about removing bounces, but the bounce rate was more than 30 times the previously reported figure. The old system was reporting bounces well below 1 percent; the new system pegged the bounces above the JupiterResearch industry average of 12 percent. More bounces means fewer assumed delivered e-mail messages, but it also gives us a chance to cleanse the list of undeliverable addresses (hard bounces after one occurrence, soft bounces after three).

Higher-Than-Expected Unsubscribe Rate

I wasn’t able to get any figures for unsubscribe rates from the previous solution, but the rate on the recent send was higher than I would have liked. My goal for unsubscribes is under 0.5 percent per send, but the November control generated more than three times as many unsubscribes as I find acceptable. An unsubscribe rate in the 1.5 percent to 2.0 percent range doesn’t sound very high, but it’s erosion nonetheless. The higher your unsubscribe rate, the more effort you have to expend on e-mail address acquisition just to maintain (not even increase) your send quantity.

Why?

In the postmortem meeting about the send, we went over the results and tried to intuit why we were seeing what we were seeing. Our perceived number-one cause of both the positive and negative effects: improved deliverability.

This client hasn’t experienced any specific deliverability issues: no influx of spam complaints, no sudden decrease in metrics, no known instances of being blacklisted. We believed all the mail was getting through when we were using the old system, but what if it wasn’t?

If it wasn’t getting through then but it suddenly did get through in November when we sent from the ESP for the first time, that would explain just about everything. With more mail getting through, we’d have a larger pool of people with the potential to open and click on our messages. That in turn provides a larger group of people who might be interested in the product, generating more leads. And it might also increase the number of people who are receiving this information for the first time (or at least for the first time in a while) and deciding it’s not really relevant to them, resulting in more unsubscribe requests.

Which just leaves the bounce rate unexplained. I think the previous, very low bounce rate was the result of a reporting error. And although the client felt it was being diligent, there’s no way it would be able to remove bounces that weren’t captured by its e-mail solution.

What About Your E-mail Marketing Efforts?

Examine your send solution. Very often when people approach me with e-mail performance issues, they’re using an ESP or in-house solution I’ve never heard of. Usually cost (“inexpensive” or “cheap”) is the justification and they re reluctant to consider other options.

ClickZ, Forrester, JupiterResearch, MarketingSherpa, and others offer information on ESP and in-house e-mail solutions. They’re worth their weight in gold. If your current solution isn’t included in these guides with positive feedback from these organizations, it’s time to look elsewhere. A quality solution is an investment in your e-mail marketing program, one that could pay off big time in increased response and conversion rates.

Until next time,

Jeanne

Want more e-mail marketing information? ClickZ E-Mail Reference is an archive of all our e-mail columns, organized by topic.