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THE FUTURE OF ECOMMERCE

Episode 1 - The Future of Email Marketing for Ecommerce

Derric explores the email marketing, from to how it might evolve into a Rich Content Format (RTF) platform fueled by Augmented Reality.

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Rytis Lauris
Co-Founder and CEO of Omnisend
Featured guest

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About Omnisend

Omnisend is an omni-channel marketing automation platform that does not only email, but also SMS, push notifications, Whatsapp, Facebook messenger, pop-ups, segmentation, and dynamic Facebook and Google ad integrations. This makes it a truly all-in-one marketing automation solution.

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Podcast transcript

I'm Derric Haynie, your host. Please email me with your feedback, requests, questions, problems, or if you'd like to be on an upcoming episode, it's derric@ecommercetech.io.

TRANSCRIPTION

Highlights:

 

I played poker professionally for 10 years. I made money off people who played poker professionally for 30 years.

How was I able to beat people who have been doing it longer than me?

I believe it's because I worked harder. I studied more rigorously. I tested what I was learning, and they ultimately became complacent.

I believe that the same thing might be happening to you today when it comes to email marketing.

Odds are you’re playing the same game you were playing 5 years ago, 10 years ago, or whenever you got into this. You’re probably sending the same email since the beginning of your business.

Meanwhile, things are changing. So, let’s bring you into the future of email marketing for Ecommerce.

Introduction

Hello! I’m Derric Haynie, your host.

This episode is sponsored by Omnisend – the all-in-one marketing automation platform for Ecommerce. More about them later in the show.

So, is the reign of email marketing coming to an end? How important will email marketing be in 2025? 2030? 2040? How is this staple of a channel going to change as Ecommerce evolves?

Email marketing has been the top performing channel for Ecommerce since the creation of Ecommerce.

But now, with the proliferation of entrepreneurship, lower barriers to starting your own business, lower barriers to sending emails in general, more brands and influencers to follow in the world, and the invention of the “promotions” tab in Gmail… Many brands are finding this channel frustrating.

From a market dynamics standpoint, we have an increasing supply of emails from brands, and a fixed, if not decreasing demand, of people’s time spent checking their email. This has to mean that email marketing is dying, right?

Not exactly.

The Move to Omni-Channel Marketing

To get a better understanding on the changing landscape, I spoke with Jason Anderson from Andzen, which is a digital marketing agency focused specifically in Email Marketing. It’s Andzen.co if you’re looking for a good email marketing agency.

He’s a Klaviyo Master Platinum Partner, and a Shopify Plus Partner, this means he’s helped a lot of brands in the industry and he’s been doing it for a while.

When I asked him about this diversification of attention, this is what he said…

Jason Anderson (Andzen):

“I think as a market share it will shrink, just as other players enter the game. Things like messenger becoming much more popular. That said, I think that you'll find that in key instances, particularly key moments in the life cycle, I would imagine that email is still going to play a really strong role.

For example, key moments like signing up, adding your email address as a piece of personal identifiable information that you give to a brand. Those stages in the journey, I think you're gonna get more personalized to the brand if you're a very young company.

Email might be the third or fourth thing that you capture after messenger and after SMS if you're targeting younger demographics. Whereas if you're targeting old demographics, email might move up to the number one piece of data that you collect and messenger and SMS might move down to a two and three.

So I think it's going to depend on the brand and as “Ecom” grows and the actual market of brands that customers engage with as that expense rather than traditional department stores and things like that.

What we're going to find is that the market share of these technologies is much more tailored to the brand and its consumer base. Whereas traditionally, things like big brands or department stores were able to have that mass appeal where they would have a much more balanced spread."

There it is… your first big takeaway. Email marketing isn’t dying, it’s about diversifying.

Diversity, Mass-appeal, Personally Identifiable Information

While Google returns over 122,000 articles about “the death of email marketing”, rest assured that the channel will continue to have merit for the foreseeable future, and many Ecommerce merchants are still finding up to a 4000% ROI and over 20% of their sales coming from this now-crowded channel.

Another key takeaway that you heard him mention is this “mass appeal effect” of the giant email blast to the whole list is becoming significantly less effective as we move more into dynamic content and improving our timing based on user behavior and how they’re interacting with our business, our website, and our products.

Thirdly, it’s time to start thinking about this and I’m going to give you permission right now to think hard in your business what piece of Personally Identifiable Information you should be collecting first.

Should it be email, phone number, messenger (getting people to opt-in to messenger), or should it be something else like push notification, mailing address or anything else. You don’t have to default to email anymore.

You can prioritize based on what your average customer prefers. If you don’t know what they prefer, maybe you should stop assuming and go ask them.

The Future of Email Marketing

Now, onto this diversification of channels. If we’re saying the future is omnichannel, then we need to get better at our omnichannel efforts.

It’s clear that other meaningful touchpoints have evolved and continue to evolve and only doing email marketing today is far from an optimal strategy.

That’s where Omnisend comes in. Our sponsor for today’s episode, Omnisend was built with this new evolution of email marketing – Omni-Channel Marketing – in mind.

So I asked their CEO, Rytis, about their transition.

How did they predict the change in the market to build for the Future of Email marketing, and the future of marketing automation, and not iterate on the past? Here’s what he said...

Rytis Lauris (Omnisend CEO):

“Commerce itself was going or started… just started. It's still not there, but it’s going omni-channel.

That means to create the ability for your customers to buy anywhere they like in any form they like: online, social media, offline (brick-and-mortar stores) with home delivery or in store pickup, etc. So that is the trend for the entire commerce.

We believe that Ecommerce is gonna lose ‘e-letter’ soon. And this is the direction that commerce is going and Ecommerce is going to blend with what we call traditional retail nowadays.

If commerce is going a bad direction, communication you do with your customer should be the only channel as well. If a customer can purchase anywhere in the form she prefers, you have to communicate for her in a form she prefers as well.”

And there’s a prediction I don’t think I was ready for.

To think that Ecommerce, this digital transformation moving to an online realm. That people are already talking about moving it back to a traditional retail experience.

But what I really like about what Rytis said there, and I think you can agree, it's about a customer's choice of communication channel and allowing them to make the choice about where they want to be communicated from and where they will ultimately purchase from you.

Online and Offline Tracking

And as he and I got into it a little bit more, he describes the process of what it might look like to transcend both online and offline and really track that customer journey a lot better than we're probably doing today.

Rytis:

“Like Shopify POS or other POS and be able to track the same customer. She showed some interest in offline brick and mortar store to that specific product and we can continue communication online with the same customer, like sending text messages, sending push notifications.

So you just had to look in the brick and mortar store and then the communication is being migrated to digital world and vice versa.

One of the huge challenges currently is that your market as digital marketing. If your company has two departments, one is responsible for the online store and the other is the brick-and-mortar; what often happens, the customers are looking at your newsletters, looking at your digital communication. Instead of buying, they still want to touch or fit. So we end up buying them in a brick-and-mortar store. So now we lose this.

So we see the future of ad tools like Omnisend and will help you to track those conversions, which has happened, initiated online, completed offline and vice versa.

We should be able to recover abandoned cart, which has been abandoned offline and you can recover it online.”

And he continues.

Rytis:

“So putting some iPad costs in the middle of a store to collect email addresses, phone numbers and get the permissions to communicate. It's one other way to tell what's going to happen in the future, but they are much more robust I would say.

Then we attach communication to loyalty programs and then the customers entering the store, we might already know that she's entering the store and that she's showing interest in something and maybe going to some specific shelves, maybe some specific products.

And the second thing is really assistance in the stores. They're proactive now, but basically they just help you and then that's it. Then they don't prolong this communication. There is no way.

So, you have your loyalty card, there's an assistant in the store who scans your loyalty card and say, okay I'm going to send you more formation about this phone, about this fridge and that's how you convert offline personal communication through quiet, personalized or highly personalized online communication.”

Okay. Now, I know we went a little bit off topic there and it's quite likely you aren't even selling in retail right now, but I think this is a beautiful insight into the merging of online and offline commerce and I truly believe that if you call yourself a serious Ecommerce business today, you will at some point grow into retail.

Whether that be by placing your product in a handful of niche retail outlets, going into the big boxes, opening up your own store or doing as Bonobos did and opening up a sort of guide shop, but still keeping the buying experience online.

Long story short, email marketing continues to be a strong part of the online buying experience. We will likely see a stronger merge of email and other channels coming into retail.

Sponsor of the Day: Omnisend

I'd like to pause and give a special shout out to our sponsor of the day Omnisend.

Omnisend is truly building for the future of Ecommerce with their omnichannel marketing automation platform. You have email, SMS, messenger, WhatsApp, push notifications all under one roof, and then you can push that to your Facebook and Google custom audiences.

This allows for deep segmentation, deep understanding of that customer journey and a better experience overall.

If you're thinking about moving into an omnichannel marketing strategy or you know that you need to communicate better between your channels, check out Omnisend. You can go to ecomtech.link/omnisend. Omnisend is truly a powerful tool that I recommend checking out.

A Day in the Life of Ecommerce

Now let's drill a little deeper into email marketing for Ecommerce specifically because we are a different beast than SAS and enterprise and local small business. Let me take you on a journey.

A customer journey, if you will. Let's say I arrive on your site. Nowadays, I'm likely to get hit with up to three popups right off the get go.

10% off to join your email list.  Yes, I do want push notifications to my browser, thank you very much. And oh yes, the live chat bubble asking if I need help with anything, even though I haven't seen a single product on your site just yet. And if I'm on mobile, hopefully I can "X" out of these popups without too much friction and continue looking for what I want.

Well, hopefully you've tested your email collection strategy a bit more than that and have these timings figured out.

Now I started to browse the site. I'm looking around for whatever I came here for. Widgets. I came here for widgets of course. Ah, here's some widgets. Let me add these to my cart. Yes, I will take that upsell offer and let's go to the checkout. I will grab my discount code from that newsletter opt in that you sent to me.

For some reason you didn't auto fill it for me though, so I'm going to go over to my email to get it. Oh no. Now I'm in my email. I've got something urgent I have to take care of. Someone's commented on my dog's Instagram post and… now I'm gone.

Luckily you have my email address so after a couple of hours you've nudged me, I get that abandoned cart email and complete my purchase. That's two emails I've received from the company before purchase.

For more complex products you could imagine it might take a bit longer, perhaps even a week of informational emails to get me to convert but for a lot of people you know there is a strong same day conversion purchase.

Now that I've purchased from you, you've sent me my order confirmation email with my receipt. It's called the notification email and it operates differently than other emails.

Let's pause on notification emails for a second because this is a big opportunity. Notification emails are required by law and typically do not have an unsubscribe button on them.

My tracking email will be another notification email. So with a return label, password reset and about 11 other types of messages that companies can send to customers regardless of their opt-in status to a marketing email.

In these notifications you can embed, upsells or cross-sells. You can give promotions, you can encourage the user to join a loyalty program or use a loyalty program, or you can simply survey your customers and ask them to give more information about themselves. You could even attempt to get unsubscribed customers back on your newsletter list.

If you aren't tinkering with their notification emails in order to maximize revenue, you will likely want to give this a try. Some of those order tracking emails actually have over a hundred percent open rate because people check them so frequently.

So back to the journey.

After a few days, you're now sending me my tracking email. Perhaps you've also sent me a welcome email or a sequence to further indoctrinate me into the brand. At this point, I'm well on my way to becoming a big fan, but you probably don't know all that much about me. In fact, you may only know my email address, my mailing address and what I've purchased from you and you probably haven't sent any of those emails we just talked about to me based on what I've purchased.

You've certainly haven't sent them to me based on why I've purchased, because even at this point, you still don't really know and I won't get into it too much right now, but if you can please set up customer surveys and feedback loops, especially with your customer service team so you can better understand expectations and prepare to beat them consistently.

Segmentation, Personalization, Predictive Analytics

Now to take it back a notch, I want to bring it to the three best practices for today and tomorrow after speaking with my guests, these three themes popped up over and over again. And they are segmentation, personalization and predictive analytics.

Let's go back to Rytis for a really great nugget on how to get started with segmentation:

Rytis:

Segmentation is one of the pieces of personalization.

“You can personalize like adding name-a-city, etc. which is always effective but segmentation is the next step. Then you don't have enough triggers to automate all the campaigns. So, segment your customers because they are different and the best way to segment is really on the behavior, on your online store more than on demographics. Demographics usually is not as important as a segment.

So let's take a segment: the customers who have visited a specific product A, run the segment and the campaign related to the specific product day. And it doesn't matter if she's female, if he's male, what state he or she is from etc.

So demographics doesn't matter. So segmentation and behavioral segmentation is the most effective.”

Now, let's bring it to Kasey Luck who runs an email marketing agency called luckandco.agency if you're looking for another good email marketing agency. She helps explain the biggest wins for brands today.

Kasey Luck (Luck & Co):

“Bigger companies, we can segment and send more personalized flows or campaigns like abandoned carts for customers or post-purchase based on this specific product because we can automate all of that.

And because we can use dynamic content and personalization in all of those campaigns, all of that is working really well.

If any Ecommerce company store didn't have that and they added that right now they would be adding like 10 to 20% to their revenue right away.”

And now her take on predictive analytics.

Kasey:

“I think predictive analytics is going to play a big role in all of the ESP email service providers. They are going to get better and better at analytics and predictive analytics as well.

Brands will be able to personalize their emails based on what a customer is looking for, who they are or where they are in their life. And offer products that are a fit for them instead of just sending like a random collection of products from there line or collection and also send them personalized deals that are based on how this shopper has been shopping so far or not shopping so far. I think that is the most interesting part of personalization for me.”

And it turns out Jason has similar thoughts on the use of AI and dynamic content creation.

Jason:

“I think the future is going to be much more targeted on segmentation and personalization. The two things that we talk about and have been talking about in email marketing a lot over the last few years.

But there's a very small number of brands who are truly doing it for every campaign, every automation to execute. So I think in the next few years what we're going to see is a lot more of is increased use of dynamic content and personalized content in campaigns.

And as AI develops, much more personalized content delivery, timing and styling, whether that's depending on the device you're opening it on, depending on the time of day, depending on your location, I think all of those things are going to be able to be much more easily automated thanks to AI.”

All right, I think we've hammered home the point enough.

Begin by segmenting users by stage that they are in in their journey then by product line or page visited and look at tools like LimeSpot or Nosto, which are both AI recommendation and personalization engines that automatically recommend the right products for your store.

We'll do an entire episode on those tools sometime soon.

The question for you today, and I expect this to be the common theme in this podcast series, is how are you going to use your data combined with some predictive analytics or machine learning to better segment, personalize and serve your customers?

Obviously a smaller brand has less power in their data than a larger one, but I believe the value is there for brands of any size and the tools are becoming increasingly easier and cheaper to access.

I'd love to get your feedback on this. Does it scare you? Do you feel like you're missing the boat already? Is your data not well organized? Not sure where to start?

Send me an email at derric@ecommercetech.io. I'd love to know and maybe I can recommend some next steps for you.

Data Protection and Regulation

Now let's quickly turn towards regulation. We've seen the GDPR, Canada's PIP EDA, and now the California consumer protection act.

All of which cracked down on how you handle consent as pertaining to your personal information and also how you store, handle and share data with partners and third parties.

In the end, these regulations I believe are good for humanity, but they change how you need to behave as a marketer and as a business. They really cut out any black hat tactics or at least make them illegal which can be fined to your business.

We'll see if people actually get punished for breaking these laws. Enforcement is really a whole other issue. We can see a clear direction with all these regulations as Kasey explains.

Kasey:

“I think that the laws and rules around privacy are going to get tighter.

We have seen that happen in the EU. I think the US is going to follow, which I think is a great thing as a consumer and I think brands and companies will just have to adjust to that.

What that will mean is the collection methods, the collection of email addresses and the data from customers and also the content that they produce and send via email will have to get better.

You'll have to send quality stuff and invite people to join your email list and in a great way and also offer them something for joining your email list so that they perceive it as a worth-it endeavor and all of that is just going to improve the quality of the emails that we're seeing from brands.”

And now let's look a little bit more into this changing landscape of email marketing and what the fundamentals of email might look like in the future.

First we head to Kasey.

Kasey:

“I think video and email is really wacky right now. It doesn't really integrate well and doesn't work well. I think we're going to see changes that.

Video and email is going to become more workable, usable, and interesting. It's going to get personalized. They are right now, but they're going to get even more so and video and email is going to be personalized as well.”

And now back to Jason who has some really interesting insights on how email might be changing in the future.

Jason:

“I wouldn't be surprised if email marketing evolves into something more that you wouldn't recognize traditionally as email marketing.

Email address is such a foundational part of gaining access to the internet when you're young. Even today, if you want to create any type of online profile, everything really still starts with your email address. For as long as that's the case and for as long as your inbox is your sort of virtual mailbox for your house, I think email will persevere.

I imagine what it would look like, develop with technology. I think AR is probably gonna play a big piece in that. As phones and tablets and computers evolve, the way that a technology like email is to live it is going to change, probably be more visual, may even be more tactile.

The key thing holding email back right now is it's being tied to be developed in HTML. And not very good on top of HTML depending on the browser that you open it in; opening it in outlook versus a web browser.

So I think as the technology that email is built on evolves email itself was going to evolve into something very different.”

And he continues to go into the changing email collection landscape as well.

Jason:

“I think technology is doing a really great job at making email collection easier.

For example, on Apple, if you click into a form field, the iOS is intelligent enough. Chrome is intelligent enough to understand that it's an email field and suggest regular email addresses that you enter into those fields.

So it's no longer a case of typing it. You can just click it with a single button now.

But I think the platforms themselves are doing a great job of helping this as well. So as you think about something like the Shopify checkout, now when you get to checkout, you pop your email address in and it'll just send you a text message with an authorization number and you can skip the whole process.

So I think, and this is something that will depend on the way that data develops and the way platforms handle privacy, but I wouldn't be surprised if we started to see a move towards more people's data being able to be encrypted.

And when they offered an ability to sign up, it's through a plugin that's maybe an encrypted app where someone keeps that data and they can give permission for that data set to be shared with a brand or not. And that might streamline the process significantly.”

Derric:

“That's so, that's exactly what I believe.

I believe we'll have this data entity that we own and we can choose who gains access to it and we can always see who gains access to it.

It's owned by ‘us’. Maybe somebody created the shell that it lives in, but they don't own the data. It's kept on our phone and then when we need to pass the data out, like whether it's credit card, email address, you pass it out one-to-one.”

Jason:

“I just think that unification is going to happen.”

Derric:

“Idealistic future as opposed to the nihilistic approach of all of your data will just be kept by all companies.”

And there you have it.

The future of email marketing is moving off of HTML-based email and into a rich text format or RTF where we can play movies, embed additional content, put in personalized videos as Kasey hinted at and possibly bring in a sort of augmented reality experience as Jason mentioned.

And I know that seems far-fetched, but the future is just around the corner and all of this will still stem around yourname@gmail.com or whatever provider you're using.

I believe we will have more power with who emails us, which means less clutter and the brands that we allow into our lives will likely make a lot of money off of being able to provide us with that consistent value we crave and that is what will keep them in the inbox.

Meanwhile, spam and annoying SEO services that I get hit up for daily, will continue to move further away from your line of sight. And promotions and company updates will be a little more hit or miss depending on how often you check that promotions tab or really want to be marketed to.

Your Homework

Your homework for this episode is to create at least one new segment for your email list and figure out custom content or a sequence or automation or a product line that you give to them that fits them better than it fits the rest of your customers.

If you sell to new moms, maybe start with boys versus girls, but then you could also maybe do twins or people that are having their second child, etc. And if you don't have the data on something like that, go get it. It can really be as simple as asking.

Final Thoughts

I'd like to thank our sponsor again, Omnisend.

If you're looking to improve that brand relationship with your customer and expand into more than just email, check out Omnisend at ecomtech.link/omnisend.

For the full show notes of this episode, you can head over to ecomtech.link/podcast.

If you enjoyed this episode, it would mean the world to me if you subscribed and left a review wherever you listen.

I'd love to hear from you and what you're doing with your email marketing and personalization efforts, or maybe you have a unique insight into your industry and would like to be on an upcoming episode. Reach out to me, I'm derric@ecommercetech.io.

New episodes will be released every Monday.

The next few weeks you can expect deeper dives into personalization, AI, technology at large, and the channels we've mentioned before: SMS, messenger and push notifications.

Down the road, we'll cover customer service, buy-now pay-later tools, inventory management systems, and every industry out there until we have painted the clearest prediction from the future of Ecommerce.

I look forward to taking this journey with you and I will talk to you soon.

How to Get Involved

And if you’d like to get involved in the show, if you’re a brand or you believe you have a unique vantage point on the future of Ecommerce, email me, I’m derric@ecommercetech.io, or you can go to ecomtech.link/podcast.

I truly value your advice and feedback. Listen, enjoy, review, and let’s have the most in-depth and public conversation we can about the future of Ecommerce.

 

Thank you to our intro soundbyte contributors:

Sharon Goldstein - Limespot

Robert Rand - JetRails

Kurt Elster - Ethercycle and The Unofficial Shopify Podcast

Jason Anderson - Andzen

Ben Parr - Octane AI

Ty Givens - The Workforce Pro

Phil Roireau - Gorgias

Jill Liliedahl - Inventory Planner