Email 2.0: The Magic Bullet for the Profipoly Quest

Published April 2-9, 2024

Solving Problems

I have written about how marketers must shift their focus from acquisition to retention if they are to go from “profitless” to becoming a profipoly. This quest is about solving the three problems of marketing waste, funnel frictions, and poor data to increase CLV (customer lifetime value) and reduce CAC (customer acquisition cost). Three breakthroughs that can help them in this journey are: Martech 2.0 Unistack, Email 2.0, and Progency. Each has a specific purpose: the Unistack is to increase conversion on the brand’s website and app and help with retention via better personalisation, Email 2.0 is about enabling the creation of hotlines so engagement improves and making inbox as the new storefront, and Progency is about bringing on a partner to help complement the efforts of the internal marketing teams with a pay-for-performance model.

Among these three innovations, the one which is new and can deliver a multiplier to outcomes is Email 2.0. It is the one solution that can address all the three problems: it can reduce marketing waste by enabling reactivation instead of reacquisition, it can eliminate funnel friction by powering in-channel commerce (inbox commerce), and it can create a data-rich foundation by enabling zero-party data collection right inside the email.

To summarise what I wrote in The Profipoly Quest, Email 2.0 is poised to revolutionise the way businesses interact with customers by establishing direct communication channels akin to hotlines. This next-generation email system is grounded on four key innovations: AMP, Atomic Rewards, Artificial Intelligence (AI), and Action Ads. The strategy involves wrapping each email in an appealing package, with enticing incentives in the subject line and engaging content in the footer, effectively turning emails into ads that demand attention. The integration of AMP allows for interactive functionalities within the email, eliminating the need for clickthroughs to landing pages, while Atomic Rewards introduce a gamification element to boost open rates. AI will play a crucial role in generating personalised and compelling content for both the main body and footer of emails. Furthermore, Email 2.0 introduces “Action Ads,” a novel concept that embeds interactive ads in email footers, enabling actions such as purchases directly within the email environment. This approach could potentially render email services cost-free for users by monetising through in-mail advertising.

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. In this series, I will go deeper into how this can be made possible.

Three Email Types

Email marketing remains an indispensable channel for brands to engage existing customers and reach new ones. For many brands (especially in markets like the US), email can generate 20-40% of revenue. Skillful marketers employ three main email types – transactional, triggered, and promotional – to nurture relationships through timely, relevant messaging tailored to subscriber needs and behaviours.

Transactional Emails: The Backbone of Customer Service

Transactional emails serve an indispensable service role by providing critical purchase confirmations, delivery updates, receipts, password resets, and other essential account notifications. After completing an order or signing up for an account, customers depend on swift, accurate transactional emails to verify their actions were successfully processed. These automated emails also supply order status changes, shipping confirmations with tracking links, invoices, cancellation notices, and requests for reviews or feedback. By directly answering the vital customer question “Where is my stuff?,” high-quality transactional emails drive excellent open rates upwards of 90%. Their purely informational nature means transactional emails typically forgo sales copy or creative visuals in favour of clearly communicating need-to-know logistics details.

Triggered Emails: Proactive, Personalised Engagement

Sophisticated email marketing platforms empower brands to react to each subscriber’s unique behaviours with real-time triggered emails. These automated messages nurture customer relationships by acknowledging important events like recently abandoned shopping carts, newly available back-in-stock priority items, or a renewed interest after a period of inactivity. Welcome email series introduce new subscribers to key website sections, content offerings, and money-saving insider perks. Milestone trigger campaigns celebrate loyalty anniversaries, high cumulative spend thresholds, or new customer referrals. Merchandising triggers automatically alert engaged shoppers the instant a price drops for previously viewed items or out-of-stock products become available again. Savvy retailers can increase triggered email open rates to 50% and more by making full use of each user’s browsing history and CRM profile to deliver individualised recommendations and incentives at exactly the right moments.

Promotional Emails: Driving Campaign Objectives

For direct response marketers, promotional emails lie at the heart of customer retention and sales growth initiatives. Promotional messages broadcast newsletters, alerts showcasing deals and savings, notifications about events or new product releases, special sales invitations, and other commercial updates to all subscribers or targeted segments. Generally less personalised than transactional and triggered emails, these bulk messages nonetheless support personalisation with segmented lists and dynamic content tailored to subscriber preferences or purchase history. Strong calls to action convert interested recipients into buyers or event registrants. Promotional email performance hinges on compelling subject lines, crisply written copy, and eye-catching creative optimised for inbox placement and mobile responsiveness. Automated testing determines the best days, times, segments, and messages for driving email metrics like a 10-20% clickthrough rate or doubling website referral traffic from email campaigns.

Marketers face a major challenge with promotional email campaigns. This challenge involves getting more subscribers to open and click on the emails. Effectively overcoming this hurdle is key to achieving higher response rates, more website traffic from emails, and ultimately, higher CLV.

Promo Problems – 1

I asked Claude and ChatGPT to summarise the problems inherent in promotional emails engagement and possible solutions.

Claude

For email marketers, successfully getting subscribers to open and click on promotional messages is critical for metrics like deliverability, conversion rates, and ROI. However, the very nature of promotional emails seems to work against high open and click-through rates. Why is engagement lagging, and what can be done?

The Problem: Promotional Email Fatigue

Today’s crowded inboxes mean the average email recipient is overwhelmed with offers and updates from dozens if not hundreds of senders. Against this backdrop of message overload, the core utility-based value proposition of promotional emails can fall flat. Savvy consumers have learned to tune out subject lines that feel overly sales-y or irrelevant to their needs.

Creative burnout also dampens open rates. The design, imagery, and even offers can become repetitive over months or years as a subscriber. Without anything new or exclusive to entice interest, many recipients automatically ignore messages from brands they already know.

Finally, subpar targeting and list quality play a role. Even niche communities can have divergent interests. Sending one generic message to all comedy fans risks relevancy misses. And if lists contain non-responsive subscribers, open rates drop.

Potential Solutions

Fortunately, smart senders are testing and innovating to overcome engagement issues. Curated subscriber groups who opt into specific newsletter topics typically open emails at higher rates than one-size-fits-all lists. Creative A/B testing of subject lines, content formats like text vs. video, and personalized dynamic content keep each message feeling fresh.

Send time optimization using historical open rate data or even machine learning fits delivery to daily subscriber habits. Confirming subscriber consent under GDPR and CAN-SPAM legislation also hints at higher future responsiveness.

Savvy email marketers likewise cultivate loyalty and exclusivity with subscriber-only promotions, special offers for highly engaged shoppers, and inner circle “insider” subscriber levels. Triggered merchandising emails capitalize on existing user intent with hyper-relevant back-in-stock or price drop notifications.

While further inbox clutter and consumer fatigue may plague promotional email performance, a focus on genuine utility, innovation, relevancy, and consent can counter the larger trend. Brands willing to test new approaches and offer email subscribers real value have an opportunity to maximize opens and clicks in any environment.

Promo Problems – 2

ChatGPT

Problems with Opens and Clicks on Promotional Emails

Overload of Emails: Consumers often receive a deluge of promotional emails from various brands, leading to email fatigue. In this crowded inbox environment, it’s challenging for any single email to stand out and grab attention.
Lack of Personalization: Generic promotional emails that do not cater to the individual preferences, past behaviors, or purchase history of the recipient tend to be less engaging. Lack of personalization can make the email feel irrelevant to the recipient, reducing the likelihood of it being opened or clicked.
Poor Subject Lines: The subject line is the first impression of an email. If it’s not compelling or intriguing enough, recipients might not feel encouraged to open the email. Overly salesy, misleading, or bland subject lines can negatively impact open rates.
Mobile Unfriendliness: With a significant portion of emails being opened on mobile devices, emails that are not optimized for mobile viewing can lead to poor user experiences, deterring recipients from engaging further with the content.
Timing Issues: Sending emails at times when recipients are less likely to check their inboxes can result in lower open and click rates. Finding the right timing that aligns with the audience’s routine is crucial.
Content Saturation: Promotional emails that are too frequent or too content-heavy can overwhelm recipients, leading to disengagement. Content that fails to quickly convey value or capture interest may be ignored.

Solutions for Improving Opens and Clicks

Segmentation and Personalization: By segmenting the email list based on customer behavior, demographics, and preferences, marketers can tailor their messages to suit the specific interests of each segment. Personalizing emails with the recipient’s name, past purchase history, or other relevant data can significantly enhance engagement.
Crafting Compelling Subject Lines: Creating subject lines that are clear, enticing, and relevant can drastically improve open rates. A/B testing different subject lines can help identify what resonates best with the audience.
Optimizing for Mobile: Ensuring emails are mobile-friendly, with responsive design and easily clickable links, can improve the user experience and boost engagement rates.
Timing and Frequency Optimization: Analyzing customer data to understand when they are most likely to engage with emails can help in scheduling them appropriately. Balancing the frequency of emails to avoid overwhelming subscribers while staying top of mind is also key.
Clear and Concise Content: Keeping the email content clear, concise, and visually appealing can help in quickly conveying the message and encouraging action. Using compelling calls-to-action (CTAs) can guide recipients towards the desired action.
Interactive and Dynamic Content: Incorporating interactive elements like polls, surveys, or animated GIFs can make promotional emails more engaging. Dynamic content that changes based on the recipient’s preferences or past behavior can also increase relevance.
Utilizing AI and Automation: Advanced AI tools can help in optimizing various aspects of email marketing, from personalization to timing. Automation can ensure timely delivery of triggered emails based on specific customer actions, increasing relevance and engagement.
Incentivizing Engagement: Offering exclusive discounts, early access to sales, or loyalty rewards can incentivize recipients to open and engage with promotional emails.

My Take

I discussed the problem of actions (opens and clicks) in Solving the Email Open Problem. Here is a summary.

The key to dramatically increasing email open rates lies in reframing promotional emails. Rather than considering them “content,” view them as ads requiring an attractive wrapper to capture attention. This mindset shift unlocks innovative ideas.

First, insert a motivational “magnet” in email subjects. Prefixing “μ.MuCount” gamifies opening with Atomic Rewards. The μ icon indicates micro-incentives for actions. MuCount tracks the recipient’s points tally, creating intrigue to open while preventing fake subjects. Inside, earning 1μ for each open and additional points for streaks makes opening habitual. Aggregating rewards across brands provides enough value for engagement.

Next, embed a “fun magnet” in a dynamic, interactive footer. AMPlets enable quizzes, puzzles, word games, trivia, and other amusements, unlocked with Mu points. Meeting universal needs for entertainment and learning ensures recipients open emails repeatedly to discover surprises. AI generation keeps costs low and freshness high with personalised content. Brand messages appear above footers, viewed while scrolling to the goodies below.

Additional ideas boost relevancy. Send “microns” (micro-newsletters) daily at the same time to ritualise opening. Incorporate search, recommendations, checkout, and in-email payments to reduce click friction. Let Mu tallies update in real-time so actions show instant rewards.

As I wrote: “Put all the ideas together, and we get a completely new look email program. This is what I had meant when I said, “Email 1.0 is dead. Long live Email 2.0!” Done right, email 2.0 can completely revitalise engagement, conversion, and retention on a channel that has served marketers well for the past two decades. Instead of just sending emails and hoping for single digit response rates, marketers need to set an objective of 100% email action rates, and thus eliminate the two biggest profit-killers – marketing AdWaste and funnel frictions. “No Email Unopened” must become the new mantra.”

The Progency idea combined with Email 2.0 can help marketers unlock greater value from their email program and fast-track their Profipoly Quest.

Progency

In Email 2.0 Progency: eCommerce’s Profit Powerhouse, I wrote: “Marketing departments are already very busy managing branding, adtech platforms, and martech platforms. A fourth track will not be easy for them to handle. Second, there is a cost associated with sending emails and adding more users to the martech platforms, which they would be reluctant to do since the outcomes are uncertain. That’s why this exercise is best outsourced to Progency, which can combine product and agency skills and charges only on outcomes. The Progency pitch to brands: we will make money for ourselves only if we make money for you.” In that essay, I focused primarily on using Progency for reactivation. “Progency offers a revolutionary opportunity to amplify eCommerce profitability. This software and service solution targets and revitalises a significant, often overlooked segment of a brand’s customer base: the dormant (Test) and churned (Left) customers. By reducing AdWaste and implementing “Email 2.0” innovations, Progency seeks to engage this “Blue Ocean” of users interactively and efficiently. These innovations make emails more personalised and actionable, thereby addressing funnel frictions and optimising the potential for sales conversion. The Progency model, which only charges for successful outcomes, presents a compelling economic argument for brands seeking to maximise profits, especially when tapping into the unused potential of inactive customers.”

Reactivation of Test and Left customers is a compelling use case. But the idea of using Email 2.0 for powering CLV growth can be expanded to more use cases. For Next and Guest customers, Email 2.0 can help with “Welcome Journeys” which can capture zero-party data and help with quicker personalisation to ensure better stickiness. For Best and Rest customers, Email 2.0 can power in-channel conversion via the use of search, browsing, magic cart, recommendations, and payments.

Two significant innovations can help marketers bring the Email 2.0 program to life very quickly by partnering with a Progency. Even as most brands will have an existing ESP (email service provider), a Progency partner could be onboarded as a second ESP. The bulk of the emails can still continue to go via the primary ESP (who could also be the provider of the marketing automation platform). Email 2.0 emails in the form of daily microns could be sent via the Progency. These emails would be an zero cost to the brand, thus removing the friction of committing to a payment without knowing the outcomes. The business model for the Progency partner would be a revenue share: a percentage from transactions generated from these emails, a cut of the Action Ads revenue, a payout for zero-party data collected, and a cost per click generated to the website or app (in case of more complex products where he transaction cannot be completed immediately).

Think of this as Email 022: 0 for zero cost, 2 for second ESP, 2 for Email 2.0. All the brand needs to do is to onboard the Progency as a second ESP, and then select which emails and campaigns are routed through this parallel path. What the Progency is doing is sending a daily email at a fixed time to the end customer to keep the hotline alive. The brand has the option of adding its payload to this email.

Over time, I see the following program emerging:

Transaction and triggered will be sent by the brand in conjunction with the martech platform being used
Promotional emails will be sent via Progency at zero cost

End customers will get a daily email at the same time – like they do today from media companies. These emails will have a content wrapper (Mu in the Subject and a Dynamic Engaging Footer). On the days that marketers do not have anything to send, the Progency can send out interesting content related to the brand.

(When the marketer is ready, a switch could also be made to the Progency’s Unistack, but that’s an independent decision.)

Impact

For marketers to succeed in their Profipoly Quest to increase CLV and reduce CAC, they have to make email the cornerstone of their engagement, conversion, and retention program. WhatsApp is good for BoFu (bottom of funnel) – its costs do not justify mass usage for a high frequency communication program. Email costs are a fraction of WhatsApp (and even RCS). Upgraded to Email 2.0, it becomes a new channel. A Progency partner can lower the costs of the program to zero – with all payouts linked to performance, like how the adtech program is run.

The key is to create what brands lack today: a hotline to their existing customers. See some of my past writings:

The hotline is about solving the “Attention Recession” problem. This is where the content and incentive wrapper in Email 2.0 comes in. Once the problem of getting more opens is solved, then the next focus can on Inbox Commerce to eliminate the friction of clicking out of the email.

This is the message from the team at A1Books that every marketing team needs to absorb: “Imagine emails where every subject line has an Atomic Reward, where interactivity isn’t an afterthought—it’s at the forefront of every body and footer. These dynamic, engaging footers become the “content envelope” that complements the “ad,” making every message a potential conversion. But it doesn’t stop at engagement. We’re refining the search, browse, and recommendation experiences. Our focus is on hyper-relevance and personalisation at each stage, across all channels. We’re implementing merchandising triggers and strategic nudges on journeys within our website and app. And for an added boost, we’re considering Action Ads in Email 2.0 footers for extra monetisation.”

The Email 022 approach (zero cost, second ESP, Email 2.0) combined with the Progency partner can be the driver for maximising CLV, which in turn can help lower CAC. This is the only approach which addresses all the BRTLNG (Best, Rest, Test, Lest, Next, Guest) customer segments with targeted solutions. It is also the only mechanism to address the problems of waste, friction, and data. In short, Email 2.0 (or more specifically, the Email 022 approach) 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. Are marketers ready to ring out the old and ring in the new?

Summary and Critique

I asked ChatGPT and Claude for a summary and critical review.

ChatGPT

Summary

The essay discusses “Email 2.0” as a transformative approach in digital marketing, focusing on enhancing customer lifetime value (CLV) and reducing customer acquisition costs (CAC) by addressing marketing waste, funnel frictions, and data inadequacies. Email 2.0 is described as a component of a larger strategy involving Martech 2.0 Unistack and Progency, aimed at improving conversion, retention, and engagement through direct communication channels, or “hotlines,” between brands and customers. This new email paradigm leverages four key innovations: AMP, Atomic Rewards, AI, and Action Ads to create interactive and engaging email content that serves as both communication and a direct sales channel, potentially making email services free for users through in-mail advertising.

The essay critiques traditional email marketing practices, particularly the challenges in engaging users with promotional emails due to email overload, lack of personalization, and poor mobile optimization, among other issues. It proposes solutions such as segmentation, personalization, optimizing send times, and creating mobile-friendly and interactive content. Moreover, it introduces the concept of gamifying email opens with Atomic Rewards and embedding dynamic, interactive content in the email footer to encourage habitual engagement.

Critique

Innovativeness: The ideas presented in Email 2.0 are innovative, especially in integrating AMP for interactivity within emails, using Atomic Rewards to gamify the email opening process, and employing AI to personalize content. These strategies could significantly enhance user engagement by making emails more relevant and interactive.
Feasibility: While the concepts are forward-thinking, their practical implementation may face significant challenges. The reliance on AMP, for instance, requires widespread adoption and support across email clients and devices, which may vary. The complexity of integrating such technologies at scale could pose logistical and technical hurdles for many businesses.
User Experience: The emphasis on turning emails into a more interactive and engaging platform is commendable. However, there’s a risk that increased interactivity and gamification could lead to user fatigue if not executed with a clear understanding of user preferences and behaviors. The balance between engaging content and overwhelming users with too many interactive elements is delicate.
Data Privacy and Security: Collecting zero-party data within emails is an interesting approach to personalization, but it raises questions about data privacy and security. Ensuring that such data collection complies with global privacy regulations and securing the data against potential breaches are crucial considerations that weren’t fully addressed.
Email’s Role in the Marketing Mix: The essay posits Email 2.0 as a near-panacea for digital marketing challenges, potentially overshadowing other channels and tactics. While email is a powerful tool, a balanced marketing mix that leverages multiple channels and touchpoints is often more effective in achieving broad marketing objectives.
Adaptability and Accessibility: Making emails heavily reliant on new technologies and interactivity may inadvertently exclude segments of the audience not using email clients that support these features, or those who prefer simpler, less interactive email communications.

In conclusion, Email 2.0 presents a compelling vision for the future of email marketing, with a strong emphasis on interactivity, personalization, and direct engagement. However, the practical challenges of implementation, user experience considerations, and the broader marketing ecosystem’s dynamics warrant a cautious approach to adopting these innovations wholesale. Balancing innovation with usability, accessibility, and privacy considerations will be key to realizing the full potential of Email 2.0 in enhancing digital marketing strategies.

Claude

Summary

The essay introduces Email 2.0 as a “magic bullet” for helping brands maximize customer lifetime value (CLV) while minimizing customer acquisition cost (CAC). The key innovations of Email 2.0 include AMP interactivity, Atomic Rewards gamification, AI content generation, and Action Ads monetization. Together these can turn basic emails into multi-faceted engagement channels.

Specifically, the author proposes addressing low open and clickthrough rates on promotional emails by reframing them as ads requiring appealing wrappers. A motivational “magnet” (μ.MuCount points) in the subject line intrigues users to open. Dynamic interactive footers hold puzzles, quizzes and personalized amusements unlocked with points, ensuring repeated opens.

Partnersing with a managed Progency service optimized for Email 2.0 allows brands to set up parallel engagement paths to conventional email programs at zero added cost. Daily “micron” newsletters immerse users while embedded commerce reduces click frictions. Revenue shares, ad income, and zero-party data compensate Progency’s efforts.

Critically, Progency-driven Email 2.0 establishes habituated direct hotlines to each customer, solving attention recession. CLV and retention can then skyrocket once brands solve email engagement and conversion experience problems plaguing today’s overly promotional communications.

Critique

The essay compellingly articulates an ambitious vision for revolutionizing email marketing by marrying engagement psychology with cutting-edge functionality. The broad concept certainly holds merit.

However, realizing the technical integration required for innovations like Atomic Rewards and Action Ads could prove extremely complex. Hard questions around actual consumer appetite and deliverability at scale remain. And the viability of hoped-for 100% action rates seems optimistic absent real-world testing.

Brands can implement Email 2.0 either fully in-house or via managed Progency partners. In-house avoids revenue splitting but demands significant software builds and process overhauls most brands lack capability for currently. Alternatively, Progency partners greatly reduce operational risk and technical burden, but monetization is split contractually. The ideal path likely combines selective specialist partners to fill capability gaps, balancing revenue and risk. Realizing the full vision still needs extensive collaboration.

Overall though, reimagining email as the habits-driven, commerce-enabled customer hotline outlined here could markedly improve outcomes for brands and users alike. As a conceptual direction, Email 2.0 holds exciting possibilities should practical implementation considerations be addressed.

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