There’s a lot to be learned from the past and the experience of others—building off their successes and learning from their mistakes. In this 2 Wins and a Fail blog series, we’re inviting clients, partners, friends and thought leaders to share their email marketing stories; both good and bad.
In this edition we highlight Faith Bukauskas, Senior Email Marketing Analyst for Hot Topic, and show how this pop culture retailer improved its email marketing results with three innovative real-time personalization strategies. Two of these email marketing examples exceeded expectations; and while the third didn’t go exactly as planned, Hot Topic has already learned how to adapt and find success with future campaigns.
Hot Topic has been the go-to destination for music, pop culture, and fashion for almost 30 years. With more than 600 locations across North America, the brand strives to ignite customers’ passions by offering only the best, authentic merchandise. Faith has worked on the organization’s email program for 3 years, and her stories and experiences hold valuable takeaways for marketers in retail, ecommerce, and CPG industries.
Hot Topic is rapidly expanding its ecommerce presence and relies heavily on digital channels, especially email marketing, to showcase its giant assortment of products to its loyal fans and customers.
Recently Hot Topic needed a new way to develop and deploy product-centric emails that were not just personalized, but could be updated in real time to deliver better customer experiences.
In the past, Hot Topic sent product promotion emails as soon as a particular product became available on its ecommerce site. But sometimes these products would sell out before all recipients opened the email (or even received it, depending on what time zone they were in).
“It was a negative customer experience,” Faith said. “The experience confused and frustrated subscribers who weren’t able to act fast enough to get the product they wanted.”
Hot Topic’s marketing team considered sending these emails earlier so they would be in everyone’s inbox before their day started—no matter what time zone they were in. Yet they were concerned that customers would forget to act on them. Even if they didn’t, the original challenge remained: customers might still open an email with a link to a product that was now sold out.
A solution was found in the form of dynamic real-time content from Liveclicker’s RealTime Email platform.
“We designed a comprehensive time-based targeting strategy to handle this issue and deliver a better experience,” Faith said. “ We started using a dynamic image when announcing a product was now available in stores. Then when the product also became available online, we used moment-of-open technology to swap in a new image with that message and provide a link to encourage online shopping. And we also had a third ‘grayed out’ image prepared for when a product was out of stock, so openers knew whether something was available at the moment they opened the email.”
Hot Topic quickly discovered that this time-based strategy was a hit. These new emails produced a 30% lift in clicks, and Hot Topic saw a significant increase in click rates after the image was switched to show a new product was now available for purchase.
Customers were much more engaged and now spent twice as much time viewing each email. Recipients now clicked before, during, and after a product went on sale; an improvement that generated new sales and revenue opportunities, especially in the case of customers who visited Hot Topic’s site before a specific product was even available.
The single biggest success metric was the reduction in customers complaining about receiving promotions for products that were already unavailable. Hot Topic has seen such improvement that they now believe they have virtually eliminated the problem on email.
Hot Topic sells an incredible variety of pop culture-branded merchandise, including Harry Potter products. The retailer used to send all Harry Potter product offers to fans based on their past purchases of any and all Harry Potter merchandise.
Yet this approach still wasn’t segmented enough; large fan bases are often split among different styles and preferences. Which band member is most talented? Who’s the coolest character in the movie? Which book is the best in the series? Such questions can divide as much as they unite.
One way the Harry Potter fans are split is among their school ‘House’ affiliation (Gryffindor, Slytherin, etc.), and that can have a huge influence on the type of merchandise they want. Customer service even noted an increase in customer complaints. If you’re a baseball fan, compare it to a sports retailer sending Red Sox fans personalized offers for Yankees jerseys. You can imagine the kind of response that would get.
“We wanted to improve overall segmentation for the fan base, but didn’t have the data to accurately divide this group,” Faith said. “So we did the most obvious thing we could think of: we asked them!”
The brand did this by embedding a poll in an email asking about subscribers’ house loyalty. This equipped Hot Topic with the data it needed to segment its list and improve future relevance, and minimized errors that might have occurred if they had to make assumptions based on click-stream or purchase data.
All of these efforts paid off. Where past Harry Potter control emails had a 10% open rate and a 1.2% CTR, Hot Topic’s new house-specific emails had open rates up to 36% and CTRs of nearly 5%. This represented improvements of 260% and 300+%, respectively.
The poll email was Hot Topic’s third-highest email in terms of highest clicks sent in 2018. The company also saw more than a 90% increase on average in click-to-open. In fact, this was so successful, the company is now considering new ways to use Liveclicker’s LivePoll element to increase explicit data from its customers, which can then be used to improve future targeting campaigns.
Hot Topic freely admits that the use of geotargeting has been a challenge, especially since a significant portion of their database is made up of Gmail users. Gmail prevents geolocation information from being recognized and instead shows all users as being in Mountain View, California.
Hot Topic’s marketing team initially wanted to deploy an email campaign that would use geotargeting to send personalized messages to recipients near the upcoming San Diego Comic-Con event.
“It was a really cool idea,” Faith said. “We had all this location-specific messaging and creative that would be perfect for anyone who opened the email within a certain proximity to the event. Unfortunately technical limitations with Gmail meant we had to table that strategy. We ended up serving the default message in email even though we went through the work of creating the segmented campaign and creative.”
As a result, Hot Topic missed out on valuable opportunity to deliver personalized content that was more likely to connect and engage with its target audience.
Fortunately, good news is on the horizon. Hot Topic is planning on taking advantage of new Liveclicker functionality that will be able to anticipate a recipient’s location at time of open based on past behavior.
Since activating on Geo-Prediction in the last few months, there have been 1.3 million impressions that have been predicted by LiveClicker. This means geo-centric content and promotions can be sent to Gmail users, along with personalized messages that can even be further targeted based on their operating system, device type, and other factors.
We would like to sincerely thank Faith Bukauskas and Hot Topic for sharing these great stories and examples. For more information, you can download the complete Hot Topic case study and subscribe to Hot Topic yourself for more inspiration (and great deals!).