Here’s why you should delete inactive subscribers

Should you delete inactive subscribers (e.g. people) from your email marketing?

A good blog post should generate an emotional response.  A Towerdata email referring to a Mailchimp blog post certainly got that from us earlier this week.

The title of the blog that got my goat is…  “Inactive Subscribers are Still Valuable Customers“.

The gist of the blog post was that your inactive subscribers are worth 1/3 of an active subscriber.  Now Mailchimp have a lot of resources and they’ve done a lot of analysis on this, over 6 billion emails worth.  They’ve even developed a calculation ratio to prove the point.

 

It’s the value of the customer that is important.

The data from the study was based on purchase behaviour from e-commerce Mailchimp clients and then cross referenced with Email Activity Metrics.

Let’s break this down.  The purchase value from the e-commerce clients was split into three groups.

  • Customers that open email (referred to as active subscribers)
  • Customers that haven’t opened email (referred to as inactive subscribers)
  • Customers that aren’t signed up (to a Mailchimp controlled marketing email anyway!)

 

delete inactive subscribers
From the Mailchimp Ecommerce Study

 

Look at the revenue split, 56% of the revenue comes from people that aren’t receiving Mailchimp email.  For e-commerce which usually relies on email as a primary communication channel, I’m going to assume that at least a portion of that is covered by marketing automation specialists such as ourselves :).   This also means that the inactives could be active elsewhere.

 

The importance of the marketing message is ignored

The Email Activity Metrics of over 6 billion emails have been reviewed for the study, but that’s also a lot of different email messages from a lot of different businesses to a lot of marketing lists.

That’s a huge number of variables to consider within such a study, and whilst these are factors beyond Mailchimp’s control, they are factors that make a huge impact in determining if an email message is opened or not.

After all effective email marketing is the right message to the right person at the right time.

 

Things we agree on

  • You should organise your data
  • An inactive is someone who hasn’t interacted with your email marketing for the last six months.
  • It’s sales that really count.

 

Separate your audience.

Customers are more important than Subscribers

As our marketing automation software tracks full customer behaviour  – marketing events as well as spend activity (basically if you capture it we can help you segment and market to that audience).   We think marketing should be built around customer lifetime value rather than generic lists, so we refer to prospects or customer rather than a general term of subscribers.

Websand links the customer information to the spend information, so we can easily separate the customers from the prospects, and the VIP’s from those that haven’t bought for a while so you can communicate with them more effectively.

Be that nurturing a prospect to a customer, moving an existing customer from their first sale to their second sale, or managing a retention process for an existing customer at the end of a warranty or contract end date.

planning a data driven marketing strategy

Once you’ve got your data organised into customer groups, it’s so much easier to get creative as you already have the audience in mind, and the objective you are looking to achieve.

With that in mind here are some suggestions to help you move your audience along and gain some extra sales revenue from your marketing.

 

Float like a butterfly, sting like a bee.

We think that’s a great rule to apply when you are planning your marketing campaigns, especially in the early stages when nurturing your prospects to customers.(1)

campaign planning guidelines

Float like a butterfly in that you should be informative, helpful and make them feel welcomed.  Don’t be pushy.  Gently does it.

Sting like a bee in the incentives that you offer.  Understand how much you can offer – by understanding metrics such as Customer Lifetime Value.  Make the offer rewarding.  Build urgency, make the offer time sensitive.  Make the communication relevant (2).

 

Now if that doesn’t work, what do you do?

This is where the uniqueness of your business and your marketing strategy come into play.  The number of rounds that you want to apply to prospects depends on your business.  If your product or service has a long decision cycle, then your nurture programme should reflect that time.  If your product or service is widely available elsewhere then your strategy would be faster.

If someone has signed up to your marketing and after the prospecting campaign they haven’t purchased, then perhaps they’ve gone elsewhere or perhaps the timing isn’t right for them at the moment.   They remain in the ‘interested’ capacity.

If you run another ‘prospecting’ round and they still aren’t interested.  Then you are being told something.  It’s not the right time for them.

The big question is at what time do you give up on them.

It depends on the business and the circumstances, but we suggest to work to 15-20 emails with no tracked Email Activity Metrics as a flag to mark as inactive, and then set the appropriate data or marketing strategy based to the value of the contact.

For example, if they are a high value customer, then you might remove them from general marketing but wouldn’t remove the data.  But if it’s a prospect you might remove them from the database.

 

Is this Business model driven or sound advice?

Marketing is about building relationships.  Despite the data presented by Mailchimp that suggests otherwise, to keep pestering people that clearly aren’t responding seems a bit, well, desperate.

The sceptic in me says that a business model that charges based on the number of records held within each account could influence a message that says you should retain inactive subscribers.

At Websand we operate a similar business model – based on the number of customer records – however part of the reason we adopted that business model was to encourage clients to jettison customer or subscriber data that was now irrelevant.  I must also point out, that we (Websand) create a relational data source for each client, whereas Mailchimp deals with lists.

So to be clear which side of the fence we sit on.  (We) Websand encourage you to remove inactive data from your email marketing.

 

Dealing with the real inactive subscribers

Let’s say that you are running some ‘newsletter’ type messages as well as some trigger based campaigns over a period of six months.

If you have No email opens recorded, then I’d suggest it’s time to put the marketing to those people on hold and here is why.

For people that are inactive on the marketing but active as a customer.

If they’ve bought from you but haven’t opened any marketing information.  No problem.  They are buying from you.

If they aren’t active with the marketing – then stop marketing to them.  I’d perhaps you no have need to regularly communicate with them while the continue to do so.  Unless it’s really important value added stuff.

When they stop buying then your data driven marketing strategy will move into action and your retention campaign will move into gear.  Perhaps that is the time you’ll get marketing activity from those people.  If not then they are truly on the inactive pile and remove them from your marketing activity.

For people that are truly inactive.  No engagement from the email and no sales.

If they haven’t bought from you, they either aren’t getting the marketing message or they simply aren’t interested.  Assuming that your prospect campaigns will be using marketing automation, the average engagement tends to be over 60%.

They already know who you are.  They signed up in the first place.  You’ve provided incentives.  You’ve given them your best lines.  They’ve not worked.  Time to move on.

I’ve seen statistics from a fellow DMA Email Council Member, Tim Watson at Zettasphere, that continuing to market to inactives can be worth up to 10% of your revenue.  So it clearly can work.

However, I’ve not any statistics on the flip-side of things, that is if they are interested they’ll come back, and that could well be worth a lot more than chasing 10%.

 

In conclusion

It just makes business sense to be efficient, and that includes your email marketing.  So you should delete inactive subscribers

The Mailchimp dataset is an interesting argument, but it’s got too many variables that don’t seem to have been considered.

Also, sending email marketing to people that want to receive your marketing messages, and not sending to people that simply ignore your messages – just makes sense from a brand and business perspective.

It’s also going to be really important when the next round of data protection changes come into force in 2017.  You’ll need to prove that you are being relevant.  I don’t believe continue to sending marketing to people that ignore your messages do that.

Finally, take those inactive’s from your marketing activity and you’ll be spending less on email, and sending to a more engaged audience so the ROI will increase.  Even a chimp can work that one out.

 

Let us know what makes sense to you? And thanks for reading.

Saul.

CEO Websand.

 

Footnotes

(1). Same concept can apply when planning any campaign really.

(2) I’ve ended up in an Infusionsoft driven nurture string for a women only conference this week.  It sounds quite good and I’ve even got an early bird offer.  However, as much as I’d like to disrupt things, I’m a man so I’m not getting in.  With their brand values, I’d have thought they’d have been a bit Smarta.

(3) A lot of our clients do this successfully, and the triggers always win in terms of results by a ratio of at least 4:1.

websand email marketing signup

Also published on Medium.