Guiding the Customer Journey to a 36% Higher Purchase Rate

How do you achieve major and lasting growth in your email marketing? Conventionally, email marketing is informed by seasonal promotions, common sense segmentation and past performance. For example, you may send women emails that promote winter coats during the fall because such emails did well enough among a similar audience last fall. These are solid best practices, but they usually don’t tell you anything beyond what you already know.

Revealing Hidden Paths to Improvement by Understanding the Customer Journey

A client of ours wanted to achieve sustainable growth in their email marketing. Specifically, they wanted to promote products to customers that previously demonstrated no affinity for those products. Conventional methods didn’t provide them with the answers they needed. So they decided to see what we could turn up.

We took the customers that our client was sending emails to and divided them into a control group and a test group, which would allow us to compare results. Our Email Campaign Optimization solution then took transactional data from the test group and interpreted it using hyperbolic geometry to create a map of the product space and plot each subscriber’s trajectory and speed through that space.

Far Beyond “You May Also Like” Recommendations

One major limitation of “you may also like” and next-best-action methods is that they tend to only suggest products within the same category, limiting opportunities for cross-sells and revenue growth. This approach also tends to serve offers which customers have already seen and not acted upon.

In contrast, the ability to map and predict the customer journey enables you to discover which products are within a customer’s comfort zone; which products are slightly outside of that comfort zone; and which products are far away, but still intersect with the customer’s trajectory through the product space at some point. In this way, you can identify hidden paths towards your goals. More specifically, you can guide customers along a sequence of products towards those products they would otherwise be unaware of, but for which they have a latent affinity. This is what we did with the test group. And it paid off.

The Result: Increased Engagement and Revenue

The Coherent Path test group dramatically outperformed the control in many key metrics. Purchase rates saw a 37.5% increase over the control group and revenue was 23.49% higher ($1,211,148.02). Click rates for the test group were marginally lower at -3.09%, but clearly this didn’t prevent the emails from generating more revenue than the control.

Again, it should be stressed that the control group and test group were otherwise identical at first. Our client wasn’t able to determine new product categories or audience segments using traditional methods. It was only after Coherent Path mapped the speed and trajectory of each customer journey through the product and transactional space that non-obvious product categories and segments were revealed that allowed for new cross-sells and revenue growth.

Open Rate Click Rate Click Product Rate Purchase Rate Expected Revenue
Test 14.32% 7.22% 2.3% 0.11% $6,367,556.01
Control 13.56% 7.45% 1.8% 0.08% $5,156,407.99
Increase 5.61% -3.09% 27.78% 37.5% 23.49% ($1,211,148.02)
Download: A Closer Look at the Science Behind Coherent Path

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