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Why email marketing is great for retail businesses

Published: 14th Nov 18

Category: Success

Why email marketing is great for retail businesses

Why email marketing is great for retail businesses

Email marketing is by far one of the most successful ways to sell over the internet. Despite the concerns of GDPR, the average return on investment (ROI) has increased by 7.5% from last year to £32.28 for every £1 spent on a campaign. In comparison to the average ROI for Google Ads and other PPC channels, that’s 15 times higher.

So why is email marketing so lucrative for businesses and how can you maximise ROI?

Why is email marketing so lucrative for retail businesses?

Email marketing has long been an effective way to market to customers. For the past 10 years, it has been the top digital marketing channel based on ROI alone. The reason why returns are so high is down to the availability of inexpensive email marketing software and the ease of use of it.

For example, some email marketing software gives you free access if you have less than a certain number of subscribers and send low quantities of emails; even after this, costs can be very low. In comparison, other forms of digital marketing, like Pay-Per-Click (PPC), cost every time someone clicks on your advert. It’s possible that you could send hundreds of emails for every click you get on Google Ads.

Conversion rates, those buying after interacting with marketing content, is higher for emails. On average, between 2 and 5% of email receivers will make a purchase after receiving an email in comparison to an average of 1-1.5% for PPC campaigns.

Customers trust emails from retailers

One of the biggest reasons why email marketing is so much more effective is that customers begin to trust brands when they receive regular communications. The customers become familiar with you and that is one of the biggest pushes in purchasing decisions.

Another benefit is that email marketing can target previous customers who’ve already bought from you. With 71% of people admitting they would rather buy from a brand they’ve already bought from, email marketing can become a critical revenue stream for any retailer.

Different types of email marketing

There are four different types of emails you can send in campaigns. Each of these has different reactions from subscribers but are all important in their own way; the four types of email are:


Newsletters are used to deliver news about the company. They have the lowest conversion rates of the four, but they help to build trust for later emails. They are also great at delivering other forms of content such as blog posts.

Sales email

Sales emails are what most brands send regularly. They have the highest conversion rate but only when segmentation and other best practices are used to generate interest for the subscriber.

Cart abandonment email

Cart abandonment emails are used when a customer has abandoned an online purchase. The email includes information about their cart with a link to complete the payment process. This email type has the highest open and conversion rates.

Reactivation email

Reactivation emails are sent when a subscriber hasn’t opened an email you’ve sent in a while. Reactivation emails are great for reconnecting with customers who may wish to continue purchasing from you or to find out who should be removed from your mailing list.

What email marketing metrics do you need to know?

If you want to be successful in email marketing you need to know some of the key email marketing metrics. Here’s a quick guide to them, with some useful figures to help you determine when you are performing above expectations.

Open rate

The open rate is the percentage of people who read your emails. The average open rate for retailers is about 23%, while restaurants can experience open rates of around 35%.

Click-through rate

The percentage of people who click through to your website or another page from your email is known as the click-through rate. The average rates for retail are roughly 3.5%, compared to 4.2% for restaurants.

Unsubscribe rate

The unsubscribe rate is the percentage of your list that has opted to not receive your emails in the future. By law, these people shouldn’t receive any marketing emails from you again. The average rate for retail is 0.28% while restaurants can receive a higher unsubscribe rate of 0.42%.

Bounce rate

The bounce rate refers to the percentage of people who didn’t receive your emails either because your server has been blacklisted, the email address doesn’t exist any more, or there are problems with their email account. There are two types, hard and soft. Hard means that an email will never be received by the email owner and soft means there’s a temporary problem.

Generally, any email contacts that hard bounce should be removed from your list immediately. Normally, less than 1% of all emails will bounce, with an even split between hard and soft bounces.

How to improve your email marketing campaigns

If you’re looking to improve your email marketing campaigns, there are best practices you can use to improve your prospects. These include:


Personalisation is key to your success with email marketing. And this doesn’t mean just using their name. Use past purchases, interactions and other information to create an email that looks tailored to the recipient.

Segment your lists

Don’t send the same email to all your contacts. You should have enough subscribers that you can segment your lists into several groups based on purchasing history or previous conversations. Use this information to create groups and send them emails more relevant to that group.

Test email strategies

Always test when you should be sending content to your audiences. The day and the time can make a significant difference to the results. Testing can help you identify strategies to build better campaigns.

Keep layouts simple and limit content

The best email campaigns have simple designs and little content on them. It’s better to get the subscriber to go to a landing page to read more than to bore them with a long email. This also helps with mobile devices, the simpler the design, the easier it is to read on a mobile device, which is the main device used for reading emails.

Be responsive


Use automation techniques to complete follow-ups with those that click-through on your campaigns to create more sales.


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