Home » 2018 Engagement Trends That Will Make or Break Your Q4 Holiday Season

2018 Engagement Trends That Will Make or Break Your Q4 Holiday Season

Alex Timlin
Alex Timlin , VP, Client Success

As we move into June and the summer months in the Northern Hemisphere, it’s typically the time when brands take stock of how they’ve performed in the first half of the year. It’s also the time when team members take a little time off for rest and relaxation before they start preparing for the “all-guns-blazing” chaos of the holiday season which seems to consume all resources from September to January.

One proven way to prepare for the holidays is to look at your customer data for shopping trends that impact your brand the most. We see how important this can be for our clients, when you can make decisions about Q4 2018 that are backed up by key metrics, ROI, and other marketing opportunities earned in the past.

In this month’s benchmark report, we’re going to focus on three key e-commerce metrics, namely “add to cart,” abandoned cart and conversion rate. By looking at these, you’ll be able to better decide which levers you should pull in the next few months to optimize your business while resources are still available — and before plans are set in stone.

The underlying goal here is engagement, and not every customer will engage with your brand in the same way or for the same reason. While this is true on a year-round basis, the differences in customer behavior become more complicated in November and December. That’s where technology can really make a difference for brands who truly want to customize the shopping experience for their customers.

Engaging the Unengaged

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As more and more clients embrace AI-driven segmentation, personalization, and execution across channels, we’re seeing a steady month-over-month increase in the percentage of our clients’ databases that engage with a brand’s website, mobile website, or mobile app, but there’s a more notable jump in these percentages that started in November 2017 and that has continued to rise since then (as shown in Chart 1 below).

For “best in class” clients, nearly 50% (49.3% on average for the top 25% of all e-commerce clients) of the contacts in their databases will engage through at least one channel in a given month. Rather than concentrating on open and click-through rates for individual channels, it’s important that we start taking a customer-centric view of engagement. Where do they come to meet your brand? And what kind of experience will keep them coming back?

Once you can see what percentage of the database you’re engaging with across all your marketing activities, then you can focus on the contacts who are not responding to your core messaging. Reaching these unengaged customers requires different strategies and tactics.

First, as shown in Chart 1, we’ve taken a look at the web and mobile visits for our clients’ customers and discovered that, on average, each contact only visits the website once per month. So, it’s really important to optimize on-site targeting and personalization to make the most of that traffic and drive conversions.

Chart 1: Trendline for share of contacts with a web visit (e-commerce, April 2016–April 2018).

Determining Who Tends to Add Things to the Cart

When you’re reviewing your previous holiday performance, one shopping behavior to understand is which customers tend to put items in carts. It depends on the industry, of course, but what we see further down the funnel is that the median “add to cart” rate for Emarsys clients is 23.5%. However, the top 25% of Emarsys clients, on average, see 35.5% of their visitors hit the “Add to Cart” button — a massive 12% difference (as shown in Chart 2).

Chart 2: “Add to cart” rates (e-commerce, January–April 2018).

What do these brands do differently to get over a 50% increase in “add to cart” rates?

What makes these brands most effective are two key elements: on-site recommendations and utilizing on-site marketing strategies to drive first purchases and reduce exit intent. This means that on their product pages, the most successful brands are making it easier for customers to purchase, primarily by reducing friction in product discovery and deploying technologies that drive first and repeat purchases. Knowing how much time each customer spends on the site coupled with predicative analytics can indicate which customers are most likely to add items to their carts and intend to save the decision of purchasing for “later.”

Our partner Magento suggests that more and more brands are using wish lists or email reminders to make it easier for customers to register their interest in buying a product for another day. Not only are you giving your customers the freedom to shop as they like without impersonal sales pressure, but it gives you and your brand another chance to market to the 76.5% of people who don’t typically add items to their cart during their visit, as shown in the example below (www.lifestylelabels.com is our Emarsys Magento-powered demo store).

Fewer Abandoned Carts with a Frictionless Path to Purchase

Even though some of your visitors frequently click the “Add to Cart” button, you still face the huge challenge of ensuring the conversion actually happens. The median result across all Emarsys e-commerce clients is a 67.2% cart abandoned rate.

Chart 3: Abandoned cart rates (e-commerce, January– April 2018).

This represents a huge revenue opportunity to better optimize your website and mobile purchasing process! The best brands have the fewest steps to checkout, and make it easy for people to buy while also reducing the need to duplicate information, such as billing address, shipping address, or account creation details.

There are many reasons why customers abandon carts and excellent campaigns to bring those left-behind items back to the top of the shopper’s mind – but our research has shown that one of the biggest reasons people abandon their carts is because they have forgotten the password to accounts they’ve already created!

Email is a great driver of acquisition, but sometimes important message data, like the frequency of password resets, sits in a silo with the IT team or forgotten somewhere in the vast e-commerce backend system. If you’re not tracking these things, you can’t optimize for them. Check how many “forgotten password” emails your own brand sends in a month and make sure you’re looking at simple steps to improve the brand experience and reduce the number of steps in the purchasing process.

Recommendations Boost Conversions

Top-performing brands recover lost revenue opportunities well. Recommendations alone can make an enormous difference in bringing customers back to purchase. Make sure your strategy includes recommendations as part of your abandoned cart campaign. Below are some of our most common AI-driven recommendation types followed by an analysis of email recommendation click-through rates (as shown in Chart 4):

  • Personal recommendations are selected for the individual customer from all products/content.
  • Category recommendations are selected for the individual from products/content within the same category (for example, recommending other TVs for people who viewed a TV online but didn’t buy).
  • Post-purchase recommendations are selected for the individual user based on their last purchase and the products and accessories that people like them typically buy with their last product(s) purchased.
  • Abandoned cart recommendations include the products that were in the individual customer’s cart as well as recommendations of similar products based on what other people bought or what the individual customer might like.

Chart 4: Click-through rates for email recommendations by campaign type (e-commerce, April 2018).

In terms of click-through rates, abandoned cart recommendations are the highest performing of all recommendation types in email campaigns with the top 25% of all Emarsys e-commerce clients seeing 10.6% click-throughs on the products served to customers.

More Channels Deliver Greater Engagement

Clients with the best-performing abandoned cart programs are those that are using multiple channels to reach their customers. Typically, these brands send an email within an hour of the customer leaving an item in their cart, and then follow up with a display ad campaign for those who don’t immediately come back to complete the purchase. As a last resort, brands can engage with customers through a higher-cost channel like SMS, especially in situations where you have higher value baskets at stake.

With our partner Optilyze, we’ve even seen carts being recovered a few days or weeks after the they were originally abandoned, and this is done with a programmatic direct mail campaign targeted to the individual customers. At the very least, make sure you’re optimizing your programs across multiple channels and using low- to high-cost campaigns intelligently to recover lost revenue.

Prioritize Your Customers Who Are Most Likely to Convert

Our clients who have the best conversion rates — 13% on average for the top 25% of Emarsys e-commerce clients (as shown in Chart 5) — typically employ multiple strategies that align with the customer lifecycle. These brands are great at capturing data, converting leads, and recovering lost baskets through email and other channels. They also ensure they engage with their clients over time so that their existing customers purchase more than once.

Successful brands have a solid email program that engages with clients over time, and they use AI-driven campaigns (Welcome, Abandoned Cart, Post-Purchase and Win-Back series) to drive repeat sales.

Chart 5: Conversion rates (web, April 2018).

The foundation of these winning campaigns is automation, one of the best conversion tools that marketers have today. In fact, for the top 25% of Emarsys clients, 73.2% of their emails (as shown in Chart 6), on average, that are sent on a monthly basis are automated via AI through the Automation Center within the Emarsys platform.

Chart 6: Share of emails sent with AI-driven automation (e-commerce, April 2018).

Planning for the 2018 Q4 Holidays Starts Now

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2018 has gotten off to a strong start across the Emarsys client base, especially in terms of customer engagement trends, and we’ve seen the patterns discussed here as they’ve taken shape for the more than 2,000 brands we work with. Moving into the summer months, it’s incredibly important for brands to understand how to engage their clients over time and how to effectively prime the “holiday season” pump for their existing customers.

Looking over the last 12 months, we can see that a well-thought-out email marketing campaign is still the backbone of a great e-commerce business with steady, dependable engagement rates all year long.

Chart 7: Trendline, email open and click-through rates (e-commerce, April 2016 – April 2018).

You have an opportunity to look at the top of the funnel and capture more contacts, drive “add to cart” behavior, and recover some of those baskets that got left behind with targeted email campaigns.

But even more than that, you should connect these campaigns to higher-cost channels, such as Facebook and Instagram Ads, Google AdWords, SMS, and direct mail (print) to make sure you’re driving performance up toward the metrics we see across the top 25%.

In the run up to the Emarsys Revolution in London this October, we’ll be doing more to share what we learn from the “best in class” brands and marketers we work with, to explore the winning tactics that delivered the results these brands wanted, and to celebrate the top 25% across some of these key metrics.

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Alex Timlin is VP of Client Success at Emarsys where he leads the Client Success organization to drive adoption and growth across 2,000+ clients in more than 100 countries. Alex is a long time member of the Direct Marketing Association’s Customer Engagement Council, Marketing Intelligence Hub, and is a regular industry speaker on marketing, customer success and SaaS technology.

Connect with Alex: LinkedIn@ARTimlin