Given the increased emphasis on customer-centric marketing, retailers are fine-tuning their strategies to reflect shopper preferences and provide more relevant and timely offers. Dillard’s, an apparel, cosmetics and home furnishings retailer, took a laser-focused approach to its email marketing by leveraging previous purchase data. The retailer made a conscious decision to avoid email messaging offers around free shipping, coupons or other incentives. Following the implementation of this new strategy, the retailer achieved a near 100% inbox placement across mobile and PC devices.
With revenues in excess of $6 billion annually, Little Rock, Arkansas-based Dillard’s operates 296 locations and 14 clearance centers across 29 U.S. states.
The new system allows Dillard’s to more-specifically target shopper offers. For example, Dillard’s may send an email to a shopper who recently purchased perfume by Lancome, offering that shopper other related luxury brand perfumes or a new face cream by Lancome. Dillard’s also uses geo-targeting to increase store foot traffic by keeping email subscribers up-to-date on special store events that often feature appearances from well-known celebrities such as Jessica Simpson and Wolfgang Puck.
According to the retailer, email program revenues have doubled year-over-year.
Combatting Spam To Maintain Open Rates
Even though its email program has been successful, Dillard’s and other retailers have struggled with the perception of email spam. The high volume of spam and illegitimate email that enters subscribers’ boxes daily has created a complex challenge for even the most seasoned and astute senders. Recently, facing a sudden decline in open rates due to this issue, Dillard’s decided to revamp its email deliverability strategy.
With the critical 2010 holiday shopping season fast approaching, Dillard’s was faced with significant deliverability issues, including blocking problems at AOL, Hotmail and Yahoo!. With help from email certification and security company Return Path, the retailer was able to achieve greater visibility into its open rates decline, Dillard’s next step was to diagnose the cause of the blocking and implement a remedy. This included optimizing the company’s custom-built email deployment system, enhancing list hygiene practices, and improving feedback loop management.
Within the first 30 days following implementation of the new strategy, Dillard’s saw open rates improve to pre-crisis levels. In addition, the retailer’s inbox placement rates approved to nearly 100%. With these impressive inbox placement rates, Dillard’s experienced a corresponding increase in email revenue and store foot traffic.
“We thought that sending relevant, wanted emails to our subscribers was enough to ensure strong deliverability,” said Mike Hodapp, Director, Digital Marketing at Dillard’s. “…We now have a team of experts to guide us through the complex maze of email deliverability and reputation management. In terms of ROI, beyond helping us to secure a profitable 2010 holiday shopping season, we see the returns every day as our email revenues continue to grow.”