Challenge

The client uses email campaigns as a common mode of customer contact. While the number of emails an individual customer receives is roughly based on revenue, there has been no systematic study of customer preferences and analysis of response patterns. Customer response to emails was historically low and campaign effectiveness was questionable. The need exists to understand customer behavior and model ideal contact type and frequency for different customer preferences.

Approach

Email “opens” and “clicks” were studied for various email buckets which indicated the chronological order of emails received by a customer (first 10 emails, 11-50 emails and so on). Response modeling helped understand the saturation point for each customer segment beyond which open and click rates decrease dramatically. Further analysis on the type of reachout (campaign vs. engagement vs. purchase follow-up) was used to determine the ideal number and type of touchpoints per month for each customer segment. Click to purchase patterns were studied to understand ideal timing of the emails to maximize effectiveness of the campaigns.

Outcome

Reaching out to the right customers with the right messages at the right frequency increased response rate by 2 percentage points with a lower number of touchpoints. The maximum impact was seen in “Middle of the road'' customer segments with average revenue and engagement. Their click to purchase rates increased by 10% leading to better engagement and increase in lifetime revenue.