Email 2.0: Making Email Cool Again (Part 4)

Forrester Wave

Netcore’s success as an ESP (email service provider) got recognition from Forrester in its recent Wave report on Email Marketing Service Providers (Q1 2022). Wrote Forrester’s Shar VanBoskirk: “The need to reliably communicate location-specific inventory updates, sanitation protocols, or changes to branch availability — combined with the appeal of a delivery vehicle for low-cost promotions — maximizes email’s moxie. Sixty-five percent of reference clients we surveyed for this report said that email marketing is somewhat or significantly more important to their companies today than before the COVID-19 pandemic. But email excitement can lead to careless correspondence. Surging email volume and data restrictions make preserving email addresses — and using them responsibly to unlock user identity and permission — critical.”

Forrester surveyed 13 email companies. Netcore debuted as a “Contender” – in the middle of the quadrant evaluating the current offering and market presence of the surveyed entities. From the report’s comments about Netcore:

Privately held and profitable Netcore Cloud is the most experienced email marketing vendor you’ve never heard of. That’s because it sends 55% of all the promotional emails in APAC and has just a sliver of business in the US. Netcore believes that email is about experiences, not just messages, and sells a related suite of customer and product experience solutions as well. While we’d love more behind its vision than just “send the right emails, to the right users, at the right time to create a memorable inbox,” Netcore does land its target market. The vendor is growing 40% year over year. Netcore’s campaign creation interface, querying capability, and ability to measure engagement outside of just opens and clicks are competitive with its western platform peers. Plus, this vendor is ahead of the curve at applying AI to marketer workflow. It offers in-line predictive segments and predictive content/offer performance to guide campaign creation. Netcore’s data integration is less flexible than that of the Leaders in this evaluation, so it primarily uses customer behaviors and profile attributes instead of contextual data to optimize message content and cadence. It also lacks packaged integrations with most major content management systems and doesn’t support distributed or franchise businesses.

So, even as there is room for improvement, Netcore has a very strong story for its enterprise customers. Its dominance in the hyper-competitive mobile-first markets of India and South-East Asia has pushed it to think deeper about the future of email. And from these conversations has emerged what I believe is the answer to the twin challenges facing every brand (rising CAC and lack of data): the pioneering innovations of Email 2.0.

Thinks 479

From Credit Suisse 2022 India Unicorns report: “Over the past year, India added a record 38 new unicorns (a third of all ever created), taking the count to 93, with a combined value of US$330bn. Eighteen from last year’s list have listed or have filed DRHPs, 21 dropped due to a change in methodology, and valuation fell below US$ 1bn for another six. The list remains diverse, with new unicorns spread across Fintech (including crypto), platforms, e-commerce, SaaS, EdTech, discretionary, logistics and healthcare. While VC funded firms do grow fast, herd behavior in financial firms has very likely pulled forward Unicorns from future years, with inflows exceeding the absorptive capacity of businesses. Over the past twelve months, a record US$65 billion in VC/PE funding has not only created new unicorns, but also raised the average value of existing unicorns by 78% to US$4.7bn. The transformation of India’s corporate landscape continues: 88% of unicorns in this year’s list started this century, vs. 66% last year, and only 15% of the BSE500. The relative importance of India’s unicorn set to India’s economy continues to be significantly higher: value of unicorns is 10% of listed market cap in India, vs. 4-5% in the US and CN.”

Stephen Kotkin: “You have an autocrat in power—or even now a despot—making decisions completely by himself. Does he get input from others? Perhaps. We don’t know what the inside looks like. Does he pay attention? We don’t know. Do they bring him information that he doesn’t want to hear? That seems unlikely. Does he think he knows better than everybody else? That seems highly likely. Does he believe his own propaganda or his own conspiratorial view of the world? That also seems likely.” 

Economist: “In the 1990s globalisation took off. Trade boomed. Annual global flows of foreign direct investment (FDI, including purchases of companies and the construction of new factories) rose by a factor of six. In 1990 Russia’s first McDonald’s opened, in Moscow; KFC set up shop a few years later. Russian oil companies began directing their exports towards the West. Between 1985 and 2015 Chinese goods exports to America rose by a factor of 125. Living standards certainly went up. The number of people living in extreme poverty has fallen by 60% since 1990. Some formerly closed countries have utterly changed. The average Estonian is now only marginally poorer than the average Italian.”

Email 2.0: Making Email Cool Again (Part 3)

Benchmarks

Netcore will be publishing its Email Benchmark Report 2022 soon. From the introduction:

2021 proved to be a continuation of 2020 in many respects. Just like everything else in our lives, email marketing went through an evolution.

Email marketing prevails as one of the most trusted channels at the marketer’s disposal to connect with customers, convert them into loyalists, and deliver on the bottom line. Email has taken big leaps and bounds in 2021 with interactivity, privacy, and multimedia.

Since the last two years of the global pandemic, email has transformed to become a crucial channel for personalized and conversational marketing. Providing a great customer experience through emails has been the preferred approach.

Email marketers reduced their frequency of emails but increased personalization, smart segmentation, and automation. We observed that marketers are becoming more AI-savvy as advanced technologies help to predict their needs, target audience, and make their job easier.

2021 was a year of growing awareness of user privacy, brand authenticity, nurturing customer relationships, and optimizing the customer experience. The traditional ways of marketing campaigns and sales pitches have no place in today’s digital-first marketing landscape.

The only way for you to have lasting success with your marketing programs is to keep up with these changing scenarios and master the email channel. In 2022, your email program needs to not only communicate but also create tailored experiences for your customers.

As user privacy becomes central with Apple’s MPP regulations, data attribution will become much deeper in 2022. Collecting zero-party data and analytics will become crucial for every experience-focused marketer in 2022.

Among the key metrics from the analysis of the emails:

  • Average open rate: 8%
  • Average click rate: 0.25%
  • Average click to open rate: 3%

In other words, for every 1000 emails, 800 of them are being ignored and just 25 emails are clicked through to the brand website or app. And these numbers are for the channel with the best RoI! Without their push messages being seen and acted on, it’s little wonder that brands, facing a serious attention recession problem, are pushed towards new customer acquisition. And yet, the focus for brands is on optimising acquisition and not building a better pipe. This is the biggest mistake being made by brands. By shifting budgets from adtech to martech (and Email 2.0), brands can reduce adwaste through a better hotline, ad targeting, personalisation and intent data. This is where Email 2.0 pioneered by Netcore comes in. Netcore’s enduring legacy of innovation, growth and relationships gives it a unique position to envision the future.

Thinks 478

Rita McGrath: “A bigger step forward in rethinking the way we organize employment is to follow the guidance of MIT’s Zeynep Ton. Ton is the author of a terrific book called The Good Jobs Strategy which makes the point that if companies provide good jobs and support their people with excellent operations, they can create a powerful competitive advantage, even in low-margin sectors. Ton’s deep insight is that loyal employees who are treated well and given the proper tools can, instead of being units of cost, enhance a company’s growth and performance.”

Manish Sabharwal and Neeraj Kakkar: “The gift of middle-class parents for entrepreneurs like us was learning early in life that we don’t live in an economy but a society. Our challenge was getting our parents comfortable with their perceived personal financial risks because the India of their youth had an unmeritocratic business regime where entrepreneurial success needed a surname, connections, or your own money. Economic reforms have blunted incumbent advantages by enabling partnerships between daring financiers and first-generation entrepreneurs. Most of these entrepreneurs will fail because they are driven by the magnificent but risky human impulse freedom fighter Ram Prasad Bismil called sarfaroshi, poet Mir Taqi Mir called junoon, and economists call innovation. But the few that survive will raise India’s soft power and prosperity by using improbable ideas to solve impossible problems.”

P Raman: “For today’s politicians, power is the essence of life. Ideology, political commitment and loyalty are variables. The party system that existed until a decade back is under challenge. It is more like business executives seeking better career options. It has become purely transactional…There have been two other concomitant developments. The first is the narrowing of distinction between political parties — in working style, personalised party control and political postures. The second is the ideological and policy compromises to suit the imperatives of power.”

Email 2.0: Making Email Cool Again (Part 2)

Evolution

I wrote about Email2 a few months ago: “Even as email service providers (ESPs) move up and down the stack to add offerings like CDP (customer data platform) and martech features (journeys, orchestration, omnichannel personalisation), the core email channel itself is evolving. The triad of AMP, Ems, and Microns – what I term as Email2 – will transform how customers engage with emails, and help brands in their continuing quest for deepening customer relationships.” I added: “Email2 will bring creativity back into email – brevity, smart copywriting, simplicity of design, and story-telling. It is about persuasion and nudging, rather than hard-selling. It is about getting attention first and brand building, rather than jumping straight into pushing for a purchase. Microns use the Subject line to create the excitement of earning rewards and thus grab attention in an Inbox of otherwise same-to-same Subject lines. Ems limit the display area to a mobile screen thus driving the need for a single, sharp message. AMP offers the opportunity to bring in interactivity – a touch or a swipe which draws the recipient in.” In the series, I also discussed new ideas like Hooked Score, Atomic Rewards and Progency.

In the months since I wrote the series, I have been thinking much more about Email 2.0 and its potential to enhance the user experience and solve the attention recession problem. In this series, I will reframe the Email 2.0 discussion around five innovations: Hooked Score, Atomic Rewards, Ems, AMP, and Progency. Together, they can engineer a habit revolution, convert the end customer’s “delete” mindset into “delight”, and make email cool again.

The reason channels like email retain their importance in the world of Instagram and Tiktok is that email is a push channel and emails are sent to identified users. Push channels are important because they help bring customers back to brand properties (website and app). In the absence of engagement on push channels like email, SMS and push notifications, brands will be forced to use intermediaries like Google and Facebook to do the outreach to their own customer base at prohibitively high costs. Push channels are an integral part of the “omnichannel personalisation” vision that brands have.

My company, Netcore Cloud, has been involved in the world of email marketing for more than 15 years. We began in response to requests from our enterprise customers to help them do “mass mailing” to lists – since we already had email expertise and were helping set up and manage their internal email servers. Through these years, email kept growing and growing. Now, Netcore does over 18 billion emails a month and serves brands globally. In India, our analysis shows that 75% of emails sent by brands to their customers go through Netcore’s platform. Email’s success has helped Netcore extend into additional layers in the martech stack – automation, journey orchestration, analytics, personalisation, and nudges (product experience.) Having been among the “originals” (early Email Service Providers), Netcore is now at the forefront of reinventing email.

Thinks 477

HBR on retaining talent: “Feeling special is more important to talent than compensation is…When it comes to managing star employees, the secret to success is making them feel like valued individuals—not like members of a group, no matter how elite.”

Arnold Kling: “My theory is that the political process preys on fear. A politician identifies something that constituents might perceive as a threat. Next, the politician “markets” the threat, playing up its importance. Then, the politician says, “If you are afraid of this threat, then vote for me.” The politician’s proposal for addressing the threat typically involves expanded government activity, which often does more harm than good. Rinse, soak, repeat.”

Mint: “Only 18.6% of working-age women in India participate in the labour force, three times lower than men, says the Periodic Labour Force Survey (PLFS) 2020. According to the World Bank, Indian women’s participation in the formal economy is among the lowest in the world—only parts of the Arab world fare worse. Even as the economy has grown, educational attainment has increased, and fertility rates have fallen, and women are not participating in the formal economy. In fact, their participation is declining.”

Email 2.0: Making Email Cool Again (Part 1)

Like ICE to EV

For a hundred years, cars have used internal combustion engines. The burning of fossil fuels have been shown to be harmful to humans and the environment. Tesla’s innovations in batteries and software have laid the ground for a new type of car: electric and autonomous, completely transforming the driving experience and creating a better future for us and our planet.

Modern marketing is on the cusp of a similar transformation moment. Brands have been plagued by “adwaste” – the half of their spending that ends up in reacquisition of customers and wrong acquisition causing great harm to company P&Ls. Customers are flooded with me-too messages from brands in their inboxes which they either ignore or delete. The result: customers have stopped listening to brands. This is leading brands down a negative spiral of overspending on acquisition and less on retention, growth and cross-sell, thus increasing brand erosion.

Marketing needs a Tesla-like solution to transform what is at the core of commerce – the brand-customer relationship. Welcome to Email 2.0.

**

Marketers are wasting half their budgets in the mad race to acquire new customers. With customer acquisition cost (CAC) rising rapidly year on year, this “doom loop of ad spending” is eating away most marketing budgets, leaving very little for building direct, data-driven deep relationships with their existing customers. Unless addressed quickly, this “adwaste” is going to cause lasting damage to brand balance sheets – and even threaten their existence. Big Tech is today’s equivalent of Big Oil – sucking away the oxygen of profits from everyone else. The flawed actions of modern marketers has meant that they have become collection agents of the ad giants – digital serfs, sacrificing their company’s profits at the altar of Google, Meta (Facebook) and Amazon, the Gods of the Tech Age.

The solution is not about trying to build the equivalent of “green oil” by optimising spends on adtech, reinventing cookies and creating privacy frameworks. The answer to the problem of adwaste lies not in building a better mousetrap but eliminating it entirely. The only way to do this is to address the problem that is at the root of it all: attention recession on the part of the consumers. Attention deficit leads to retention recession which in turn causes continuous customer churn. So far, the only solution that marketers have come up with is with transaction-linked incentives in the form of discounts and offers. All these gimmicks do is negatively impact profitability without improving loyalty.

What marketers have missed is that addressing attention recession requires building a hotline to their customers and taking the 10-20% view rate of push messages to 80-90%. Only then will they be able to lower adtech spends to get their existing customers to listen, gather more data, drive greater revenue growth, and thus improve profitability. Without sustainable profits, a business becomes a money guzzler and eventually dies when investors pull the plug on new funding.

Solving the attention recession problem, eliminating data poverty, reducing CAC is the pathway to driving profitable growth and must become the top priority of every marketer. The starting point has to be reinvigorating push messaging because the only alternative to bring customers back to the website or app for transaction push messaging is massive spending on branding. Email remains the best of the push messaging channels and can in fact improve the efficacy of the other channels. Therefore, the focus needs to be to make email cool again – Email 2.0.

Email 2.0 is the Tesla-like innovation, changing the customer mindset from delete to delight, driving engagement and habit creation, and powering exponential forever profitable growth. It is the only antidote to brand extinction because if customers are not listening, there is no point for a brand to keep speaking. Email 2.0 creates habits by making the sent seen and the seen actioned. It drives mental availability for the brand by becoming a utility in the lives of customers. The power and value of Email 2.0 can transform CMOs into Chief Profitability Officers of their businesses, and perhaps into future CEOs. Email 2.0, like Tesla, can truly make tomorrow’s world a better place for all of us as custodians of brands and customers of products.

Thinks 476

The Generalist on ten lessons from great businesses: “Be a painfully persistent recruiter (Stripe). Maximize deep work time (Levels). Obsess over your customer (Coupang). Align the incentives (AngelList). Think like a nation-state (Terra). Invest in soft-power (FTX). Preserve optionality (OpenSea). Intensify your advantages (Tiger Global). Find your counter-positioning (Telegram). Proactively reinvent yourself (Many).”

HBR: “In this article we explore how cutting-edge companies build what we call intelligent experience engines to assemble high-quality customer experiences using AI powered by customer data. They design end-to-end solutions—for example, finding a location, scheduling an appointment, sending appointment reminders, providing directions, and guiding users through any necessary follow-up—that proactively lead customers toward achieving their goals. They also combine human enablers (cross-functional, agile teams) with data and technology that allow for rapid self-learning and optimization. Although building an intelligent experience engine can be time-consuming, expensive, and technologically complex, the results allow companies to deliver personalization at a scale we could only have imagined a decade ago.”

Taxes Indian style. From Economic Times: “GST rates on pizzas differ on the basis of how they are prepared and sold. A pizza sold and eaten within a restaurant attracts 5% GST, the pizza base bought separately attracts 12% while a pizza delivered at home attracts 18% GST.”

Dear Netcorians: My Annual Day Speech (Part 3)

Our Future

Dear Netcorians,

We are on the verge of a historic move – becoming a public company. When we accept money from others, our responsibilities will increase. We will have a great obligation to deliver value and returns for big and small investors.

We also want to ensure wealth creation for as many of you as possible.

We may not always match the salary offers that you get from other companies. But if you trust us, if you have stock (and everyone in Netcore can get ESOP), you will make more money over the next few years than what you will make with a salary hike.

Our expectation is you put work ahead of life; I know this is a big ask after the past 2 years of the pandemic. Remember that nothing in life comes easy.

At Netcore, you can live the life of an entrepreneur or CEO in whatever function you do. You get to see what it takes to run and build a business. You can be an entrepreneur within and lead. Working at Netcore is like doing the world’s best startup MBA program! Netcore prepares you for the future, gives you an education no money can buy.

If you want to quit Netcore, don’t quit for money; quit to become an entrepreneur. I will be the first to congratulate you. It is the hardest journey you will undertake in your life.

For 30 years, Bhavana and I have done just that. Life for us has been about our two companies: IndiaWorld first, and then Netcore. 24×7; even while on vacation; always looking one step ahead; a life built around our work; with passion.

We are now ready to climb the next mountains; together with Unbxd; and as a public company.

Netcore’s journey will go on; as an institution that outlasts every one of us. Built to last; an enduring, great company; one that delights customers, innovates, grows.

Many among you are our future leaders; you will be tomorrow’s faces of a public Netcore.

Thank you for being a part of the Netcore team and family.

I ended by asking everyone to join me in singing one of my favourite songs – Ruk jaana nahin tu kahin haar ke (from Imtihaan). I called it the song of an entrepreneur, the anthem of Netcore.