Email 2.0: Martech’s Answer to Adtech’s Search and Social

Published April 20, 2024

1

The Need

Search and Social have enabled adtech to become an attention and monetisation machine. For any brand wanting to acquire new customers at scale, there is no alternative to the two gatekeepers, Google and Meta. What is astonishing is that even after the acquisition is done, brands continue to rely on the adtech platforms for continuing relationships with their existing customers. This is because of attention recession on the brand owned channels – email, SMS, and push notifications. WhatsApp is rising in some countries but is limited in its use to bottom of funnel use cases because of its cost. The result is that brands are caught in a vicious trap of ever-increasing spending on adtech platforms on new acquisition and reacquisition, leading to a hit on profitability.

This is a theme I have explored extensively in recent times. Adtech (acquisition) spending is close to 10 times that of martech (retention). Increasing CAC (customer acquisition costs) creates a spiral which becomes counter-productive because it reduces the budget for existing customers, leading to lowering of CLV (customer lifetime value). No surprise then that adtech has grown to $500 billion in annual revenues with martech being a fraction of that. Recent results from Google and Meta suggest that adtech growth continues to be strong.

The starting point for adtech is where attention is. This is where search and social win. Google dominates search and video with YouTube, and Meta has a commanding presence in social with Facebook, Instagram, and WhatsApp. Some other platforms have emerged in recent times: Tiktok, Amazon, Pinterest, Snap. But the dominance of Google and Meta has stayed steady through the years.

The root of the profitability problem for brands is the lack of a hotline for their existing customers. Email is still the most cost-effective channel, but its lack of innovation combined with increasing spam has reduced its efficacy. RCS (controlled by Google and the telecom operators) can emerge as a rich media alternative to SMS. WhatsApp (controlled by Meta) has already emerged as the SMS alternative in many countries.

There is a pressing need for a channel that can help marketers build deeper relationships with their existing customers. In the absence of such a channel, marketing spending will continue to rise. Brands may continue to grow but at the expense of profitability. (Simple math: When Meta grows 25% year-on-year, given that small business mortality is about 20% annually, actual same business spending is probably rising close to 35-40% year-on-year – much more than revenue growth.)

This is where Email 2.0 comes in. Built on Google’s AMP technology, it brings interactivity to emails and can enable in-channel engagement and conversion. But Email 2.0 is much more than just the elimination of a click to a landing page. Email 2.0 is about recapturing attention in the inbox, making email a habit, and potentially providing paths to additional revenues for brands. In this series, I will bring together some of my past essays and new thinking to show how Email 2.0 can be martech’s answer to adtech’s search and social because it can hold the attention of consumers and drive multi-monetisation. In doing so, Email 2.0 can solve the three profit-killers for brands: marketing waste, funnel frictions, and poor data. The outcome: a virtuous cycle of increasing CLV and decreasing CAC to help brands in their Profipoly Quest.

2

Attributes

While I have written many essays about Email 2.0 over the past couple years, my thinking has also evolved on how to frame the discussion around Email 2.0. Let’s begin by looking at all the elements that make up Email 2.0.

AMP: Interactivity is the breakthrough that makes Email 2.0 possible. AMP brings app-like functionality to email to power in-channel conversion by ensuring better engagement and frictionless commerce. The clickthrough to the landing page is no longer needed; the actions can now be done in the inbox itself. In the campaigns we have run for Netcore for customers, we have seen 5-15X increase in actions performed because of the removal of the friction of going to a landing page. But Email 2.0 is more than just an AMP Email. [See AMP’s Magic: Coming Soon to Your Email Inbox.]

Atomic Rewards: This brings gamification to the email. A micro-incentive (Mu) can be given for actions. For example, opening an email could get 1 µ, providing zero-party data can get 10 µ, and so on. These incentives can be pan-brand since a single brand may not be able to offer adequate rewards for in-mail actions. Atomic Rewards bring in an element of fun and surprise to the email. Mu in the Subject (with the MuCount) can be a magnet for driving more email opens, especially for promotional emails. [See Atomic Rewards: The Solution to Attention Recession.]

Dynamic Engaging Footers: Once marketers realise that what they are sending in an email is not “content” but an “ad”, they will understand that emails will need a content wrapper to get recipients to open their emails. It is why newspapers still offer comics, crosswords, and puzzles – to get attention. This is where the email footer comes in. Traditionally, the footer has just had a link to unsubscribe. The footer can be made engaging with a collection of AMPlets (small AMP sections, which can update in real-time or be static) which could offer games like roulette, word jumbles, spelling bees, and more. Additionally, there could be Mu as an incentive to play and win. [See Dynamic Engaging Footers: Email 2.0’s Silver Bullet.]

Action Ads: A new ad format can bring monetisation into emails. These ads differ from the existing ads in four ways: they can be linked to an individual (PII), they are served on Push messages (so no need to wait for a user action to create a view), the action on an ad can be done in-Place (eg. filling a form, giving consent), and Payments can also be collected within the ad itself. These 4 Ps create a unique ad format which become a revenue generator for brands and lay the foundation for build an “email media network”. [See Reimagining Email Ads.]

Microns: I use the term to describe a “micro-newsletter.” The idea is that an email must be sent daily at the same time to become a habit in the life of the recipient. Media companies have done this very well. Brand emails tend to come in at random times. Also, they must have some informational content in them. For example, a fashion brand could send dressing tips. These are short messages which can be consumed in seconds. Along with Atomic Rewards and Dynamic Engaging Footers, they can go a long way in improving open rates, ensuring no email goes unread. [See Solving the Email Open Problem.]

Taken together, these five attributes lay the foundation for a new email format – one that I have termed as Email 2.0.

3

Benefits

This section written with inputs from ChatGPT, Claude, and Gemini.

Consumers

For consumers, Email 2.0 brings many benefits. We can group these into three main categories: Enhanced User Experience, Personalisation and Relevance, and Engagement and Rewards.

Enhanced User Experience

• Interactive and Convenient: Email 2.0 leverages AMP technology to transform emails from static messages into dynamic and interactive experiences. Consumers can perform various actions within the email itself, such as making purchases, browsing catalogs, RSVPing to events, or booking appointments, without the need to navigate to external web pages. This not only enhances interactivity but also significantly saves time and makes email communication more efficient.
• Rich Content and Integrated Services: Beyond simple text and images, Email 2.0 introduces a variety of engaging content types like quizzes, polls, games, and mini-applications. It also integrates services such as secure in-mail payments and product recommendations directly within the email, offering a richer content experience and making emails a one-stop solution for many consumer needs.

Personalisation and Relevance

• Tailored Content: Advanced AI and data analytics enable Email 2.0 to offer highly personalised content that aligns with individual preferences and behaviours. This ensures that consumers receive relevant and tailored information, making their interaction with email content more meaningful and reducing inbox clutter.
• Consistent and Informative: Microns are sent daily at consistent times, providing short and informative content tailored to consumer interests. This habit-forming approach ensures that emails become a valuable and anticipated part of the consumer’s daily routine.

Engagement and Rewards

• Gamification and Incentives: Email 2.0 introduces elements of gamification and rewards into the email experience. Features like Atomic Rewards and Dynamic Engaging Footers incentivise engagement by offering micro-incentives for actions such as opening emails or providing data, adding an element of fun and surprise.
• Engaging Footers and Action Ads: The transformation of traditionally plain footers into spaces for engaging content like games and puzzles, along with the introduction of Action Ads tailored to individual preferences, makes emails more attractive to open and interact with. These elements not only enhance the entertainment value of emails but also offer more relevant and personalised advertising experiences within the email itself.

Marketers

Email 2.0 is an asset for marketers also. We can categorise the benefits under three main themes: Enhanced Engagement and Conversion, Data-Driven Insights and Personalisation, and Monetisation and Brand Loyalty.

Enhanced Engagement and Conversion

• Interactive Content for Higher Engagement: Email 2.0’s use of AMP and other interactive elements directly within emails significantly increases user engagement by making content more engaging and interactive. This leads to higher open and click-through rates as recipients are more likely to interact with content that resonates with their interests and invites interaction.
• Streamlined Customer Journey for Increased Conversions: The capability for in-email actions such as making purchases or signing up for services streamlines the customer journey. By reducing the number of steps required to convert, Email 2.0 can help in significantly lifting conversion rates, as the friction associated with navigating to external landing pages is eliminated.

Data-Driven Insights and Personalisation

• Rich Data Collection for Enhanced Insights: Interactive elements like quizzes and polls not only engage users but also serve as tools for collecting zero-party data. This data provides marketers with deeper insights into their audience’s preferences and behaviours, enabling more effective targeting and personalisation.
• Personalised Experiences through Advanced Analytics: The integration of AI and data analytics within Email 2.0 enables marketers to craft highly personalised email experiences. By understanding customer actions and preferences in greater depth, marketers can tailor their content more precisely, enhancing relevance and engagement.

Monetisation and Brand Loyalty

• New Avenues for Monetisation: Email 2.0 introduces innovative features like Action Ads and the concept of an “email media network,” which open new avenues for monetisation. These features allow marketers to monetise their email campaigns beyond traditional methods, offering in-email ad inventory, lead generation, and direct sales opportunities.
• Enhancing Customer Retention and Loyalty: By delivering more engaging, interactive, and personalised content, Email 2.0 helps brands foster stronger relationships with their customers. Features like gamification, rewards programs, and consistent, valuable content contribute to increased customer retention, loyalty, and lifetime value.

Email 2.0 thus is a win-win for consumers and brands.

4

Segment Solutions

Email 2.0 is the answer marketers have been looking for to address the three profit-killers of marketing adwaste, funnel frictions, and poor data for specific BRTLNG (Best, Rest, Test, Left, Next, Guest) customer segments.

Best and Rest Customers: Email 2.0 solves the problem of funnel friction by enabling in-channel conversion. It revolutionises how transactions are conducted by embedding purchase capabilities directly within the email. This approach reduces the steps a customer must take from interest to purchase, effectively streamlining the buying process. By integrating features such as one-click purchases, embedded product galleries, and instant checkout within the email environment, Email 2.0 eliminates the need for customers to navigate away from their inbox to complete a transaction, thereby minimising drop-off rates and enhancing conversion efficiency. In effect, it makes the email inbox as the new storefront. [See The Coming of Inbox Commerce and Email Shops can Transform eCommerce.] Email 2.0 also helps with zero-party data collection. It facilitates a more interactive engagement with customers, enabling brands to gather zero-party data – information that customers intentionally and proactively share. This can include preferences, interests, and feedback collected through interactive polls, surveys, and preference centres embedded within emails. This direct line of communication not only enhances personalisation by informing brands about individual customer preferences but also fosters a deeper sense of trust and loyalty as customers see their input directly influencing their brand experience.

Test and Left Customers: For customers who have become inactive or have churned, Email 2.0 offers a dynamic approach to re-engagement. Through gamification, personalised content, tailored offers, and interactive elements that reignite interest, Email 2.0 transforms standard reactivation emails into engaging experiences. These campaigns can leverage insights from past interactions to craft messages that resonate on a personal level, effectively reminding customers of the value the brand offers and enticing them back into the fold without the need for costly reacquisition strategies. Reactivation via email reduces the need for reacquisition via adtech which can be much more expensive and leads to waste since the brand still has a right-of-way to customers. A Progency partner can help with reactivation.

Next and Guest Customers: For new or prospective customers, Email 2.0 enhances the onboarding experience through “Welcome Journeys”. These are not just a series of introductory emails but are immersive experiences that guide new subscribers through the brand’s universe with personalised content, interactive tutorials, zero-party data collection, actionable insights. By leveraging AI and data analytics, Email 2.0 can tailor these journeys to individual customer profiles from the outset, ensuring that every piece of content, offer, or call-to-action is relevant. This strategic personalisation from the beginning of the customer journey sets the stage for more meaningful engagement, faster conversion, and long-term loyalty.

[See Email 2.0: The Fulcrum for Fixing Five Funnel Frictions, Email 2.0 Progency: eCommerce’s Profit Powerhouse and Email: The Magic Bullet for the Profipoly Quest.

5

Martech’s Answer

One of the biggest reasons for the profitability challenge many digital businesses face is because of the ever-increasing cost of customer acquisition. Most don’t realise that half of this spend is being wasted because of wrong acquisition and digital acquisition. CMOs make growth their primary focus instead of prioritising profitable growth.

The path to profitability means tackling high CAC and low CLV, which in turn can only be done by solving the three primary profit-killers – marketing waste, funnel frictions, and poor data. As I have discussed in Profipoly Quest and storified in The Profipoly Quest: Maya’s Story, the three breakthroughs needed are Unistack (with Unichannel), Channels 2.0, and Progency. To this mix, I would add Email 2.0. As I wrote in Email 2.0: The Magic Bullet for the Profipoly Quest, “The vision for Email 2.0 extends beyond mere communication; it aims to be a comprehensive platform for brand engagement, conversion, and customer retention, offering a cost-effective alternative to messaging apps like WhatsApp, which, despite their effectiveness, come with a higher cost barrier for mass marketing. Email 2.0 represents a promising avenue for reinvigorating email marketing by blending the efficiency of instant messaging with the affordability of traditional email, setting the stage for a new era in digital marketing. Email 2.0 can transform the EnCoRe (Engagement, Conversion, Retention) funnel, making it an important foundation for the Profipoly journey… [Email 2.0] is thus the “magic bullet” which can help brands elevate their marketing and accelerate their Profipoly Quest. It also brings to martech the same ease that adtech offers.”

Martech needs new ideas and solutions if it has to take its rightful position as the primary focus for marketing departments. Adtech is all about spending money in a never-ending chase for new (and existing) customers. Martech is what is supposed to maximise their lifetime value. Martech success is the only route for sustainable business outcomes – what I have called “profipoly” (exponential forever profitable growth). It is in this journey that Email 2.0 is the game changer – a new channel built around a known identity (the email address). For the first time in more than 15 years, email is seeing innovation. What it needs is a champion who can make it happen and make it the attention and monetisation driver for brands. Email 2.0 can thus become martech’s answer to adtech’s search and social. Every month, a few billion consumers get about 20 trillion emails (1.0) from brands delivered to their inbox. Imagine these emails becoming the 2.0 variant. The ingredients and the recipe are there; what’s needed is the chef!

6

Summary and Critique

I asked ChatGPT, Claude and Gemini for a summary and critique of my essay.

ChatGPT

Summary

The article addresses the growing inefficiencies and high costs associated with traditional digital advertising platforms, emphasizing the over-reliance on adtech giants like Google and Meta for customer acquisition and retention. It presents Email 2.0, powered by innovations such as Google’s AMP technology, as a transformative solution. Email 2.0 introduces interactivity, personalization, and gamification into email marketing, offering a more engaging user experience and deeper customer insights. This new approach aims to recapture consumer attention within the inbox, reduce customer acquisition costs, and enhance customer lifetime value. By leveraging features like Atomic Rewards, Dynamic Engaging Footers, and Microns, Email 2.0 is positioned as a sustainable alternative to traditional adtech, promising to enhance both consumer engagement and brand profitability.

Critique

While the article compellingly presents Email 2.0 as a promising solution to the limitations of current adtech practices, it tends to overlook the potential challenges and implementation hurdles. For instance, the adoption of AMP and other advanced technologies may require significant changes in current email marketing infrastructures and strategies, which could pose challenges for smaller businesses with limited resources. Additionally, the reliance on Google’s AMP technology raises questions about platform dependency and the broader implications for market competition and data privacy. The article could benefit from a more balanced perspective, acknowledging these potential drawbacks and exploring how they might be addressed. Furthermore, the piece could be strengthened by incorporating case studies or empirical evidence demonstrating the real-world impact and effectiveness of Email 2.0 strategies, providing readers with a more grounded understanding of its effectiveness and practical application.

Claude

Summary

This extensive essay makes a compelling case for the need and potential of “Email 2.0” to transform digital marketing. It argues that ever-rising ad spend has fueled the growth of adtech platforms like Google and Meta, but this unrelenting customer acquisition battle is coming at the cost of profitability. Brands desperately need more effective channels to engage their existing customers. Email 2.0, powered by innovations like AMP interactivity, atomic rewards, dynamic footers, action ads, and microns, can reinvigorate email as the missing retention and monetization engine. By recapturing attention, driving habit-formation, and enabling in-channel conversion, Email 2.0 solves multiple problems – funnel friction, poor data, and marketing waste. It can boost engagement, conversions, and loyalty among various customer segments while opening new revenue streams. Thus Email 2.0 represents the game-changing martech innovation to counterbalance adtech, the “magic bullet” to accelerate profitable growth, and the fulcrum to transform digital marketing.

Critique

This essay puts together a compelling vision for how Email 2.0 could transform digital marketing. It makes a strong case for the need and potential of this concept. However, the ideas presented around atomic rewards, dynamic footers, microns etc. remain largely theoretical and unproven as yet. More case study examples demonstrating the impact of these features would strengthen the arguments. While AMP for email has rolled out, the other aspects may face adoption challenges getting brands on board en masse. The technology capabilities and change management needs for organizations to operationalize these concepts also requires elaboration. That said, the essay sets up Email 2.0 as a promising, profit-focused alternative to expensive adtech reliance. It rightly recognizes engagement, habit creation and zero party data as the keys to long term brand building. The vision is sound; what remains to be seen is effective industry-wide implementation.

7

Alternatives

I then asked ChatGPT, Claude, and Gemini: “What do you think is maretch’s answer (other than Email 2.0) to adtech’s search and social for attention and monetisation?” Here are their responses.

ChatGPT

Martech’s answer to adtech’s search and social for capturing attention and monetization lies in creating more personalized, engaging, and value-driven experiences for users, leveraging data and technology to enhance customer relationships rather than just focusing on customer acquisition. Here are some key elements that constitute martech’s response:

1. Personalization at Scale: Martech solutions leverage customer data and AI to deliver highly personalized content and experiences. This goes beyond basic segmentation to include individualized content, product recommendations, and tailored customer journeys, which can significantly enhance engagement and conversion rates.
2. Customer Data Platforms (CDPs): CDPs unify customer data from multiple sources into a single, comprehensive customer profile. This allows marketers to gain deeper insights into customer behaviors and preferences, enabling more targeted and effective marketing strategies that can rival the reach of search and social ads.
3. Omnichannel Marketing: Unlike adtech, which often focuses on specific channels (like search or social media), martech embraces an omnichannel approach, ensuring a consistent and seamless customer experience across all touchpoints, including email, SMS, web, mobile apps, and in-store interactions.
4. Engagement through Value: Martech emphasizes providing value to the customer at every stage of the journey. This could be through informative content, loyalty programs, or interactive experiences that not only capture attention but also build a stronger brand-customer relationship.
5. Privacy-First Marketing: In an era of increasing privacy concerns and regulations, martech offers a more sustainable approach to customer data handling and personalization, respecting user consent and data privacy, which can enhance trust and loyalty in the long run.
6. Advanced Analytics and Attribution: Martech tools offer sophisticated analytics and attribution models that help marketers understand the impact of their strategies across the customer lifecycle. This insight allows for more efficient allocation of marketing budgets and resources, focusing on strategies that deliver the highest ROI.
7. Interactive and Immersive Technologies: Incorporating technologies like AR, VR, and interactive video into martech strategies can provide immersive experiences that are more engaging and memorable than traditional ads, helping brands stand out in a crowded marketplace.
8. Email 2.0 and Beyond: Innovations like Email 2.0, which incorporate AMP for more interactive and transactional email experiences, represent the evolution of martech to keep the email channel relevant and effective in capturing attention and driving monetization.

In summary, martech’s answer to adtech’s dominance in search and social lies in leveraging technology and data to create more personalized, engaging, and value-driven customer experiences across multiple channels, focusing on building long-term relationships and trust with consumers.

Claude

Aside from Email 2.0, here are some alternative martech solutions I see that marketers can leverage to drive attention and monetization with existing customers:

1. Customer data platforms (CDPs): Unified customer data profiles help deepen understanding and segmentation to craft more relevant messaging and offers across channels. Boosts retention and share of wallet.
2. Loyalty programs: Gamified programs with personalized rewards, tiered benefits and special experiences incentivize engagement and customer lifetime value. Can also integrate partners to augment value.
3. Personalized push notifications: Timely, tailored mobile notifications prompt action and steer behaviors aligned to customer interests and habits detected through analytics.
4. Interactive chatbots: “Digitizing” some elements of customer support and concierge services allows 24/7 assistance via conversational interfaces. Can service and upsell existing customers at much lower costs.
5. Hybrid (human + digital) model: Leveraging a mix of automation and human touchpoints to nurture customer relationships via the optimal blend of scalability and personalization.
6. In-app messaging: For brands with apps, driving re-engagement of existing users via contextually relevant in-app messages and frictionless on-app transactions.

The common theme centers on using customer insights to foster relevance, interactivity and added value – less reliance on mass blasting. Combinations of the above strategies also viable to balance acquisition and retention.

Gemini

While Email 2.0 offers a promising solution, understanding other avenues martech can leverage for attention and monetization with existing customers is crucial. Here are some contenders:

1. Customer Data Platforms (CDPs):

• Function: CDPs unify customer data from various sources, creating a holistic view for personalized marketing campaigns. This empowers targeted advertising, relevant product recommendations, and dynamic content offers within existing channels like email, apps, and websites.
• Benefits: Increased engagement, conversion rates, and customer lifetime value through hyper-personalization.
• Drawbacks: Requires data governance and integration expertise, can be costly for smaller businesses.

2. Omnichannel Marketing Automation:

• Function: Automates personalized marketing journeys across multiple channels like email, SMS, push notifications, and social media. This fosters consistent brand messaging and triggers relevant interactions based on customer behavior.
• Benefits: Increased customer engagement, improved campaign performance, and streamlined marketing operations.
• Drawbacks: Demands robust data infrastructure and marketing expertise, potential for channel overload for customers.

3. Subscription-based Engagement Models:

• Function: Offers tiered subscription plans with exclusive content, early access to products, or loyalty rewards. This model directly monetizes customer engagement and fosters long-term relationships.
• Benefits: Predictable recurring revenue, stronger customer loyalty, and valuable customer insights.
• Drawbacks: Requires creating high-value content and managing different subscription tiers, may not be suitable for all businesses.

4. Interactive Content Experiences:

• Function: Leverages formats like quizzes, polls, games, and augmented reality within existing platforms to capture attention and gather valuable data. This creates engaging brand interactions and encourages deeper customer understanding.
• Benefits: Increased brand recall, improved data collection, and boosted customer engagement.
• Drawbacks: Requires creativity and technical expertise to develop engaging experiences, may not be scalable for all applications.

5. Community Building and Advocacy:

• Function: Fosters brand communities online or offline, encouraging customer interaction, feedback, and advocacy. This leverages the power of word-of-mouth marketing and strengthens customer loyalty.
• Benefits: Authentic brand promotion, valuable customer insights, and organic customer acquisition.
• Drawbacks: Requires ongoing community management and engagement, may not be suitable for all industries.

Choosing the Right Approach:

The best alternative to Email 2.0 depends on your specific audience, marketing goals, resources, and existing technology stack. Consider a combination of these strategies for a holistic approach to customer attention and monetization. Remember, data-driven insights and a deep understanding of your customer base are essential for success in any martech endeavor.