The Importance of Email Marketing for Group Purchase Companies in China

Group purchase is the most popular topic on the Internet in China this year. According to a report conducted by CNZZ, there are over 3,600 group purchase websites in China with monthly growth rate reaching over 29 percent.

Undoubtedly, an upheaval is happening because of the rapid expansion of the group purchase industry. More customers in China are increasingly shopping and purchasing online and more local as well as international businesses especially those in China have gradually moved to e-commerce within a decade. According to another research by Tuan800, business turnover has reached 1 billion in 2010.

It’s not complicated to find out the common elements of these group purchase websites. Interestingly, most of them use email marketing to roll out real-time promotions daily and regular e-news to subscribers. You can find the eye-catching subscription area placed at the most conspicuous place in every group purchase website.

Why do marketers of group purchase companies invest a lot of resources in email marketing? Obviously, they are eager to create and establish their ‘owned media’ in developing a valid database instead of being bound by other kinds of media such as ‘paid media’ and ‘earned media’.

Paid media includes the various traditional advertising and similar vehicles that a company has to pay for ad space or third parties to promote its own products or services. Earned media is generated when the quality or uniqueness of a company’s products and content compel consumers to promote the company at no cost to itself through external media. Owned media consists of different properties such as database/channels owned by the company and it can fully utilise owned media to achieve various marketing purposes like communicating with VIP members and subscribers.

Owned media has become more significant and influential because with owned media, marketers are able to control the whole process of marketing without worrying about any potential problems caused by third parties. Moreover, marketers can analyse its customers’ behaviour for further business strategic planning and fully optimise promotional channels based on advanced tracking reports.

The more popular group purchase websites have a large number of members. It’s very hard for marketers from group buying companies to say “No” to these resources when doing marketing. Undeniably, a valid database is always the most valuable asset for them. If marketers can invest a lot to acquire, expand, and develop the database, get to understand the preference and behaviour of individual recipients, deliver the right information to the targeted recipients at the right time via the right channel, marketers could definitely expect to achieve the best performance.

Compared with various promotional channels and media, email marketing is measurable and maintains a close relationship and communication between merchants and members/subscribers. Moreover, email marketing is proven as a high ROI compared with other media, according to research from the Direct Marketing Association as illustrated below.

Nowadays, advanced technology can enable marketers to launch personalised campaigns and targeted promotions. As group purchase companies have recruited over tens of thousands of members; it is necessary for marketers to roll out customised eDMs to individual recipients not only for broadcasting or branding campaigns, but also to launch a series of automated triggered based and lifecycle campaigns with few time cost.

By creating email marketing via owned media, group purchase companies could control their investment and resources at a reasonable level. Increasing repurchase rate and customer loyalty is no longer a great challenge if marketers come up with a comprehensive and strategic database planning. The most essential consideration is marketers could control the whole process and own valuable assets.

In short, the devotion and development in email and database marketing will become the key factors to the success of group purchase companies within these few years.