Dear [First_Name], There's a Better Way to do Personalization

A fellow marketer told me a sad story.

Once upon a time, as director of growth for a large, purportedly customer-focused SaaS company, it was his team’s job to increase engagement and upsell customers through email. However, he faced the usual challenges so many of us see: a lack of developer resources, poor data infrastructure, and disconnected apps. 

Here’s what the process looked like, every time his team wanted to email a specific cohort of customers:

1. Run a slow MySQL query against the company’s database to pull a customer list based off purchase/renewal date and subscription type
2. Scrub list for unsubscribes and people who have received similar upsell campaigns in the recent past
3. Upload this static list of email addresses, first names, and product plan descriptions into their email service provider (ESP)
4. Build an HTML email for the campaign and use UTM parameters to track links
5. Send out a campaign through ESP, which operates separately from their marketing automation platform and CRM
6. Wait for engagement, and report on metrics like open rate and click-through rate
7. Determine conversion rate through Google Analytics and UTM parameters

It would take his team roughly one week to get all the pieces in place—just to send one email. Second, if the extent of your customization is, “Hello [First Name], Would you like to upgrade your [Product Description] plan?” you’re not serving your customers any added value.

This tale of inefficient, impersonal email process is all too familiar. It’s crazy that for so many companies, limited developer resources, constrained email programs, and limited customer data points are the status quo. So we personalize on whatever bits of personal or demographic information we have available to us.

Ladies and gentlemen, we can do better.

Personalization should add more value than a stale tidbit of information from a static database. Today more than ever, marketers should have access to real-time data about our customers and how they interact with our websites and products. This data can help us be more relevant, provide more value, find the right timing, execute better customization, and create a truly personalized process for communicating with our customers.

Personalization starts with tracking the actions that drive customer success. From there, you should be able to customize your communication based on where the customer is in their journey, and where they should go next. In a customer-focused organization, personalization can help you find the happy intersection between what your customer wants (value) and what you want them to do (convert, renew, upsell).

The focus of personalization should be on optimizing how you reach customers, when you reach them, and reaching out with something to add value, rather than asking for a sale.

Sure, go ahead and add in those mail-merge basics like names and dates to make your automated emails feel more human. But even if you have technical limitations with your backend data, ESP, or automation platform, there are a few other key things you should be measuring and building cohorts around:

1. Where the customer is in their individual journey
2. Engagement history, frequency of engagement, and failure to engage with aspects of your product or service
3. Which specific actions they can take next to increase engagement, encourage progress to the next phase of the customer journey, or trigger conversion

Let’s pretend that we’re creating an email for my friend’s scenario: The primary goal is to get basic plan users of a SaaS product to renew their subscription, with a secondary goal of upselling them to the premium plan.

The old-school way to personalize:

Subject line:  Your {{Product Name}} subscription is renewing soon

Dear {{First Name}},

Thanks so much for subscribing to {{Product Name}}. I trust we’ve been helping you do an amazing job at {{Company Name}}. This is a friendly reminder that your subscription is set to renew on {{Date}}. Your subscription is set to auto-renew, so you don’t have to lift a finger.

Did you know that you’d get access to even more {{Benefits and Features}} if you upgraded to a premium plan?

Just reply to this email or log into your account to upgrade to premium.

[  Get more {{Benefits}}  ]

All the best,

{{Account Manager Name}}

P.S. You can change or cancel your subscription at any time by clicking Manage Preferences on your Account page.

Awesome, right? Nope. This isn’t personal at all. It’s probably just more noise in an already-noisy inbox. This approach to renewal and upsell doesn’t take some important context into consideration: your customer’s most recent engagement, the nature of their engagement, and what actions they need to take to get to the next phase of the journey on their own.

Even worse, if a customer hasn’t found value or benefits from your product or service, this renewal reminder could actually serve as a prompt to cancel.

The new-school, digitally driven way to personalize:

Once you start tracking the actions that drive customer success, you can optimize your communication strategy based on historical interactions or to encourage actions they haven’t taken yet.

Rather than relying on static information in your database, you can run dynamic campaigns triggered by real-time behaviors and based on educated guesses about what you customer might want next. Usage analytics platforms like Mixpanel, Segment, and Heap make it easy to define and measure engagement; once you’ve determined the factors that drive retention, it’s time to start personalizing on behavior.

So let’s say we’ve used Mixpanel's funnel analytics to establish which actions drive retention, and discovered that customers who engage more than twice in the first month are 30% more likely to renew. We also discovered that customers who use the maximum value of their subscription are 60% more likely to upsell to a premium plan.

So now you should apply behavior-driven personalization to four distinct objectives:

1. Proactively encourage initial engagement, especially for customers who have not completed vital onboarding or first steps. For example, if you can tie retention to milestones like completing a community profile or downloading a report, customize your engagement campaigns to encourage those specific activities.
2. Identify gaps in engagement that prevent customers from getting to the next stage. Find the customers who are stuck in their journeys, and use their behavioral data to trigger targeted campaigns with added value to keep them moving. What are your stickiest features? Send behavior-driven emails to customers who haven’t interacted with them yet.
3. Upsell your highly engaged customers. Target customers who have higher engagement rates or are already getting the maximum amount from their current subscription or service—it may be time for an upgrade to a larger plan or to sell a valuable add-on.
4. Encourage renewal with a personalized value prop. When you have behavioral data on how your customers are interacting with your product, you can encourage renewal with a breakdown of the value you’ve already provided, or a custom look into your customer’s successes throughout the subscription or service period.

Beyond boosting engagement and conversion, you’re moving the focus of communications away from the benefits and features you’re trying to sell, and toward the value you’re already providing to the customer. It takes a little bit of technological investment (like setting up Mixpanel events and running cohort analyses), and a lot more supporting content—but with good funnel analytics in place, you’ll be able to see the payoff of a dynamic, personalized communication plan in real-time.

For an in-depth view of how Usermind helps you connect your usage analytics data to your marketing automation platform, CRM, help desk, and other systems to automate and optimize the customer journey, request a personalized demo.

image via Flickr