The real problem with open rates

A report came out from an ESP that discussed ‘industrywide’ declining open rates.   (click here to read article in eMarketer)

Basically this report outlined three growing problems that are contributing to this problem.   One of my favorites was: 

….A second factor is the phenomenon of file aging. The longer names are on mailing lists, the less productive they become. Over time, the less productive e-mail addresses become a larger part of a marketer's list.

What they don’t talk about is why older names become less productive.   I’ll accept some element of churn.  People leave.   But our research indicates that there is a much more controllable problem here….relevance.

I’ve used the American Airlines example plenty of times in this blog because it hits this problem right between the eyes.   I’m Gold.  I’m in the top tier of all their customers. I’m loyal.  And, I could get 5 or more emails a week….I don’t read any of them!  (Download american_airlines_examples.pdf )

You know why?  The emails have nothing to do with me:  Offers for credit cards (no, no and no!), exotic singles vacations (married with 4 kids…if they ever care to ask) and trip specials that never originate in Indianapolis (where I live)

My point is that file aging is a great explanation for why open rates for this ESP are declining into the low 20%’s.  Almost all retailers suffer from the same problem, and it's because they still are using email as a cheaper Mass Marketing Tool instead of a revolutionary Database Marketing tool.   

But the opportunity here is to fix this by being more relevant.  Only talk to your customers when you have something to say.  (if no specials from Indianapolis, then leave me alone) And when you do talk to your customers; talk to them about something they care about.

I watched Jerry McGuire last night (“I liked your memo”), and Jerry had the answer:  Less email, more focus on the customer!

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