This ecommerce strategy article is an excerpt from our new book, The Ultimate Ecommerce Email & SMS Playbook. We’re diving into our ecommerce strategy chapter focused on the 7 Reasons Why Ecommerce Customers Leave Your Brand.
The secret to great email marketing lies in segmentation and personalization. Those two pillars rely on data.
Having data for the sake of data is not enough. As a marketer, you need to turn copious amounts of data from myriad sources into clean, consistent, and actionable data. Let’s dive into the core sources of data that your E-commerce business must bring into your email marketing:
- Purchase data: No surprise, you need to ensure clean purchase data is coming into your ESP at all times. Some brands prefer daily feeds from their CMS, others prefer real-time purchase data via API, and some have pixel tracking built-in. All have benefits, especially when dealing with fraudulent orders, in-store purchases, returns, or pre-orders. The cleaner the purchase data, the better your email and SMS will perform.
- Browse data: Knowing what a subscriber is doing at this very moment is critical for the modern-day marketer. It’s not enough to know what a customer HAS shopped, carted, and used; it’s more valuable to see what they WILL shop, cart, and buy.
- Product data: Clean product data, complete with taxonomy, categorization, attributes, specifications, and stock level will boost your personalization capabilities significantly. There’s nothing worse than sending a customer a cart abandon email for a product that’s on pre-order or featuring a popular camera to thousands of customers and realizing it’s been sold out for months. Your best-performing automations – cart abandon, browse abandon, and post-purchase, to name a few – tend to be product-centric. If the product details, images, and links are rife with errors or outdated quickly, those automations will often fail. Clean product data – complete with a comprehensive data dictionary to understand every data point – is critically important.
- Customer data: Creating a customer-centric email program will help you become a truly differentiated, trusted, and successful brand. Customer data goes beyond merely purchase and browse history; think about subscription preferences, credit & financing specifics, loyalty & points, preferred store location, net promoter score, reviews & feedback, and any other data points that will enable you to enrich the customer experience via email and SMS. There may be multiple sources for customer data – especially if you have a reward, credit, and financing setup – so be prepared to have multiple APIs or feed connections powered into your ESP.
- Engagement data: Typically, this is part of your ESP – opens, clicks, unsubscribes, site visits, and on – but there are some scenarios where brands will miss opportunities. An example of that would be if a customer visited your store or placed an order in-store; that’s an important data piece to bring into your ESP. Another example are SMS and push notifications – knowing if a customer was communicated with via those channels would be helpful so you can suppress them from any additional marketing efforts today. The top brands use their ESP / CRM / CDP as a hub for communication so they don’t overwhelm their customers. The value of creating a staggered multi-channel marketing flow is monumental and will help you reduce disengagement and unsubscribes while increasing the chance of a conversion. A sample of a high-performing multi-channel marketing approach, like a cart abandon, could go as follows:
- Touch 1 – Send email
- Touch 2 – Send SMS
- Touch 3 – Send email two
- Touch 4 – Send to Facebook for retargeting
These are the five data pillars you’ll need to create a truly magical email, SMS and CRM strategy. Most of your marketing capabilities can be achieved using each of the data points above, but when used alone, each pillar doesn’t provide enough value.
Here are a couple examples where missing data causes missed opportunities:
- Post-Purchase: Your ESP may see a purchase come in (via pixel tracking) and immediately begin your post-purchase email series. But if the order was canceled or returned a day later and your ESP didn’t know about it, that post-purchase email looks kind of ridiculous. And you don’t want customer service ringing you up every day with a complaint, trust me!
- Cart Abandon & Out of Stock Items: powering a cart abandon series is a great revenue driver. For products that are out of stock (OOS), only on pre-order, or are add-ons to other products, cart abandon emails become very annoying. Creating a suppression for OOS items and pre-orders should be in your product feed.
- Welcome Series Buyers vs. Non-Buyers: Triggering a Welcome email to new signups with a discount is great, but what if that new subscriber is a new customer who joined the list at the same time? Triggering a discount to that customer leads to customer complaints that they want to use that discount on their recently placed order. Cue the headaches. Using your purchase and engagement data, your ESP needs to split the path of a new subscriber and new customer and send slightly different experiences to each.
These examples will illustrate how to orchestrate your data to work together and amplify each other. Remember: the key is to have actionable data, not just all data. It’s very appealing to have all your customer data come into your ESP and just cover yourself, but, in my experience, sending all the data leads to slower campaign launches, slower segment building, and an overall sluggish ESP as it tries to wade through all the information. Focus on actionable data, not the most data.
This brings us to the topic of first, second, and third-party data. These terms are essentially sources where you can get all the above data sets powered to your business, ESP or CRM to help enrich your customer profiles or acquire customers.
Here’s a quick primer on these data sources and what they mean for your business:
First-Party Data
First-party data is essentially data explicitly provided to you by the end-user, such as an email opt-in, SMS opt-in, or address information with purchase. First-party data is highly valuable because of its high quality. Because you collected it directly from the source, you know it’s accurate and highly relevant. Privacy concerns are therefore minimal, and, since the access was explicitly granted, you now own the data.
Most customers don’t realize this, but when they submit an email or an SMS phone number, they unlock hundreds of additional data points within your tool, such as IP address, browser/device, mobile IDs, online cookies, or other 1s and 0s that can be very hard to sift through.
There are many options for how you can use first-party data. You can use it to predict future patterns of their customers, gain audience insights, and email and SMS personalization. Some of the best personalization occurs with first-party data; think about high-performing birthday automation that gifts a subscriber when their big day nears.
Second Party Data
Second-party data is essentially someone else’s first-party data. The seller collects data straight from their audience, and it all comes from one source. You can feel confident in its accuracy since you’re purchasing second-party data directly from a company that owns it. There’s no middleman in this transaction; all you need to do is seek out a company with the data you need and form a relationship with them.
Second-party data is similar to first-party data, but it comes from a source other than your own audience. It can include data from many of the same sources first-party data comes from, such as activity on websites, mobile app usage, social media, or customer surveys.
Second-party data helps you stitch together additional insights you couldn’t get from first-party data alone. Most e-commerce brands might purchase this type of data to add scale to their first-party data, especially if their first-party data sets are small but growing. And because the data comes directly from a company that collected it, there is transparency between you and the company. This gives you control over what to buy and how the data gets used.
An example of second-party data in action would be for a new product line, such as a new men’s product for a historically female-centric brand. If you’ve historically targeted women, you wouldn’t have enough data on men to power a truly great launch. As such, you might partner with a men’s health, fashion, or fitness website and buy the data you need from them.
Another example is acquiring new leads. Partnering with certain brands that have millions of email addresses and sending targeted emails to their list or even buying those lists and running ads to that list is a great way to acquire leads quickly. As an email marketer, I would personally advise against simply buying email lists and throwing them into your database; you’d have to warm them up and get some form of permission from them before marketing to them within your ESP. In lieu of mass-mailing this new email list, I’ve found the best approach to leverage social media ads to get their opt-in, thereby turning those users into first-party data.
Third-Party Data
Finally, there’s a third tier of data. Third-party data is data that you buy from outside sources that are not the original collectors of that data. Instead, you buy it from large data aggregators that pull it from various other platforms or websites that it was generated, such as insurance lists, opt-in forms, medical quotes, and on. These aggregators pay publishers and other data owners for their first-party data. The aggregators then collect into one large data set and sell it as third-party data. Many different companies sell this kind of data, and it is accessible through many different avenues.
You can use third-party data in the same way as second-party data; the only difference is its cleanliness. You can use it to expand your audiences, enhance your first-party data, and increase the precision of your acquisition ads, helping you discover new audiences.
I’ll give a really great example of third-party data working extremely well for cart abandonment. Generally speaking, you can identify maybe 50% of the total cart abandonment on your website. Of that 50%, maybe half or 25% are actually subscribed to your email list. Imagine if you could get that remaining 25% to convert somehow AND also identify the other 50% in some way and try to reach them with a cart abandon! How great would that be for your business!
Here’s where a third-party data provider becomes very useful. If that provider can identify those emails or even market to them on your behalf, that would be a very high ROI investment. There are vendors who do exactly that, and we love sharing their information with our clients to increase profits. Third-party data offers some great incrementality to your marketing strategy.
In summary, actionable data is always better. First-party data is critical to a personalized email and SMS strategy, but you can also fill in the gaps or enrich your customer profile using second and third-party data sources.
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