Are your marketing costs way too high?
Here’s a simple tip to bring them down: identify under-utilized potential in your existing customer base.
Look at the results of your latest email campaign. The average revenue per targeted customer is the minimum value of your contact in the database. Mind you, this isn’t lifetime value, just a monthly average.
Looking for business case
If the average profit from your most recent campaign is just $1, we’re talking a yearly value of $12 for each contact in your DB. If you have a 1% monthly churn (unsubscribed contacts) it’s still over $11 a year. If you could send an email each week, the profit could be 2x – 4x higher. $33 a year multiplied by the number of all your customers should make an interesting use case.
The question is, how well do you tap into this hidden value? How many emails do you actually send per month to your customers, and what should be the optimal number? In other words, does your company already utilize the full potential of its user portfolio?
Building a segmentation
To answer these questions, build a segmentation in Exponea based on the number of emails the user received in past 30 days. Break your portfolio into 5 segments:
- Underutilized (0 emails received in last 30 days)
- Partially utilized (1 email)
- Utilized (2-4 emails)
- Over-utilized (5+ emails)
- Just unsubscribed (unsubscribed in last 30 days)
If your portfolio looks like this then you have just uncovered hidden potential. Most customers are under-utilized and just 17 (around 0.3%) unsubscribed recently.
You may wonder if this may be due to over-utilization. Just check how many emails those customers received before unsubscribing. In the picture below, a half of them unsubscribed right after the first email. While the sample is small, two insights become immediately obvious: over-utilization is not a problem yet and sending 2 emails per month is a very safe strategy.
Alright, so we know about the potential in our user base. It’s time to take action. In Exponea, click on the “Underutilized (0)” segment to open a new scenario designer and send emails.
Hidden potential exists in all businesses. Email is one of the cheapest and most effective channels. A simple analysis in Exponea can easily turn this potential into profit, provided you have the right content. Knowing the size of your potential and reward will help you rethink your marketing priorities.
If you are an Exponea user and would like to see the dashboards from this article, just ping us over our live chat. Our support can send you the final version of analysis directly to your project.