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August 26, 2004
SUMMARY: Although Avon has been in business for 118 years, it's anything but a stodgy old-guard company when it comes to email. In our interview, Avon's ecommerce Director Pattiann McAdams reveals:
In fact, you might want to sign up at Avon.com to In fact, you might want to sign up at Avon.com to do a 'swipe' file and steal ideas for your own email program: |
Boon because there's a lot of brand affinity to work with. Challenge because she doesn't want to do anything that might hurt the relationship between customers and the 650,000 Representatives that drive the company's core business.
So how does she and her team do it? This is what we learned in our interview..
Offline, customers see a new brochure every two weeks and are used to regular contact with their Representative. Their expectations are conditioned by this experience, making them particularly receptive to a program of regular communication and contact.
McAdams says, 'Our core business is a merchandising engine; we take that merchandising and actually mirror it online. Since we change our site every two weeks with different promotions, we -- unlike a lot of other people -- have a reason to connect to the consumer more frequently.'
However, that doesn't mean Avon's email program is shovelware for a new e-brochure every two weeks..
How Avon uses advanced segmentation and content diversity to keep email appealing over the long-term customer relationship:
Avon's outgoing emails include the typical service messages like order and shipping confirmations, but also, for example..
- Replenishment emails (reminders to restock on items, based on previous purchases and typical product usage rates).
- Notification emails (consumers can request a notification when a new or out-of-stock product becomes available).
- A quarterly 'Let's talk' e-newsletter.
- Between two and eight promotional emails a month with new products and promotions.
-- Segmentation
McAdams notes, 'You put the brochure out there and wouldn't you love to know what that customer who reads it is going to buy and then put that on the front cover? You can't do that, but on the Internet you can.'
She says segmentation's about.. 'making sure you're giving the consumer exactly what you think they're going to convert at, as opposed to the generic brochure which has everything in it.'
The email team uses around 20 segments, mainly defined by product brand allegiance, based on a customer's past purchases. 'We have many different brands and each brand will actually connect with a different consumer.'
Each segment receives unique promotional emails 'featuring' the relevant brand, its associated products, and the models that actually promote those particular products.
Oh yes, and there's also a segment for those who are not loyal to one particular product brand.
-- Post-click analysis
But segmentation alone isn't enough, says McAdams.. 'That's only to get them in the store.'
The team monitors the purchases that result from email clickthroughs and adjusts future emails accordingly to encourage cross-brand sales.
So if customers within the ANEW brand segment click through and actually buy a lot of Cellu-Sculpt products, then.. 'the next time I email to ANEW, we might merchandise that product within that segment.'
-- Frequency matching
The number and timing of promotional emails that each customer within a segment gets also varies on an individual basis. An in-house algorithm determines the best time to send a promotional email, based on that customer's past purchase history and last purchase date.
The system also takes into account those customers who will likely purchase anyway (so don't need a special email promotion).
McAdams says, 'We target our special offers depending on how aggressively we want them to convert at that point in time, and we also will monitor if we have to do something versus if we don't have to do something, based on their probability of purchasing.'
-- Personalized up- and cross-selling
Outgoing promotional emails also include personalized upsells, with the system automatically appending a 'we know you bought this, you might like this..' type message.
The key to all this sophistication is data analysis. McAdams says, 'There's always a reason why customers act the way they do and what we have learned is rolling up your sleeves and digging underneath that data has helped drive a lot of the success.'
She points out that there are two data challenges email marketers face.
The first is knowing what to do with the data and prioritizing the workload.. 'If you are highly analytical and understand why you're asking the question, you will never get too much data. Our biggest challenge is prioritizing what we should do first.'
The second is recognizing the true costs of using and applying data analytics.. 'The investment sometimes is understated -- purely because of the sense that there's not a number that you can always put behind it. But it's resources and time.'
How Avon keeps 650,000 sales reps happy despite email selling direct to customers
But what about that channel conflict issue? Isn't email marketing taking sales away from Representatives?
McAdams says, 'If you shop with us and you're attached to a Representative, we don't actually send you competitive emails. In order to sustain the future of this company, that (customer) relationship needs to stay with that Representative.'
Customers are also asked to input the phone number of their Representative on online order forms -- and all online sales are then credited to that Representative.
In fact, McAdams and her team go beyond simply avoiding conflict to actively using online initiatives to support the Avon brand and the Representatives themselves.
Some examples..
-- Lead generation
The avon.com homepage gives equal prominence to the online store and to finding a Representative. The result is tens of thousands of new customer leads a year forwarded to Representatives.
-- Product and promotion synchronization
The products and promotions featured online are identical to those in the most current brochure, so there's no competition on price or selection.
-- Market research
McAdams' team takes email marketing data and the results of email customer surveys to build demographic profiles and test marketing concepts. This then feedbacks to the core offline business, where, 'we know the Representative but we don't necessarily connect with that customer.'
McAdams notes, 'This really helps drive new product launches as well as deciding some of the marketing concepts in the core brochure..we can help them understand customer patterns.'
-- Online tools for Representatives
With 70% of Representatives online, McAdams' team helps them reach their customers online, too. So, for example, they'll send Representatives appropriate promotional emails to forward to their customers.
'We pre-populate their information within the message. And they get to personalize it, so they can say, 'Hi Sally, I thought you might be interested in these specials this week'.'
The email '..comes from the Representative, so she still gets to maintain that connection, but we take all our creative resources and our best expertise to help her market the brand online.'
As well as helping the Representative, this tactic also ensures brand conformity and consistent messaging across all marketing vehicles.
-- Internal email campaigns
McAdams is also applying consumer email experience to the Avon organization itself. So the concepts behind the notification and replenishment emails for consumers are implemented for sales representatives, reminding them to place their orders at the right time.
Overall, McAdams sees a bright future for email in the health and beauty sector.
'It's the fastest growing category online from a sales side..women are coming online, they're building more confidence, and they're also finding out that this is an easy way to stay connected with brands such as Avon.'
Note: Avon Products is a member of Shop.org, a forum for retailing online executives to share information, lessons-learned, new perspectives, insights and intelligence. More info at http://www.shop.org
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