• by Chad White , May 22, 2012

Last year, when I examined how major retailers handle inactives, I was alarmed that most still emailed subscribers who had not opened or clicked an email in over three years. Since that research was published, smanaging inactives has thankfully become a hot topic.

While some are trying to dispel the whole notion that mailing long-term inactives is a danger at all, there’s mounting evidence that smart marketers are taking prudent steps to improve their deliverability and email revenue by using engagement metrics. At Interact, Responsys’ annual user conference, there were many examples of clients implementing engagement-based emailing: that is, reducing email frequency to inactive subscribers and boosting email frequency to the most active subscribers.

For instance, travel site Orbitz used a 3-email re-permission series to clean out subscribers who hadn’t opened or clicked in more than six months. Three percent said they wanted to continue receiving emails, 2% said they didn’t, and 95% didn’t respond. “We removed that 2% plus the 95% and all of our deliverability problems magically disappeared,” said Ted Wham, vice president of customer relationship marketing at Orbitz.

While a six-month cutoff may be on the short side for some marketers, that was the threshold that made sense for Orbitz based on its subscribers’ behavior. The re-permission series gave inactive subscribers several chances to raise their hands to stay on the list, and at the end of that series, Orbitz made the wise decision to sacrifice the ability to mail its inactives in order to be able to consistently reach all its active subscribers. That’s an exchange that many smart marketers are now willing to make, realizing that overall list size is secondary to maintaining their deliverability to engaged subscribers.

But it’s not always easy to convince the C-suite of the logic of this exchange, as Chris Nickel, manager of CRM & direct response marketing at electronics maker Epson, discovered. Eighty percent of Epson’s email list was inactive, which the company defined as not opening or clicking a single email in more than 36 months. To prove to management that removing inactives wouldn’t affect revenue, Nickel removed them from the main list in four batches over time. Likely because of the long replacement cycle of electronics, the company did experience a slight decrease in overall email revenue while decreasing its email volume by 80%, but the move was considered a success and led to a much healthier list.

Of course, engagement-based emailing isn’t just about mailing inactives less or not at all. It’s also about emailing the most engaged subscribers more. Skin-care brand Philosophy has been putting a full-spectrum plan into effect. First, the company analyzed its inactive subscribers, looking at acquisition sources. According to Tiffany Berry, Philosophy’s e-commerce marketing manager, the company found that email subscribers acquired through Facebook converted at a 90% lower rate than other subscribers. Philosophy cut off that acquisition channel and also stopped using sample campaigns because of the low-quality subscribers they attracted. It also decreased its full-file emails by 40%, which led to a 50% rise in email revenue by sending more email to engaged subscribers -– without increasing unsubscribe rates.

Email marketing is quickly heading toward Individualized Email Frequencies, with a unique subscriber receiving a number of emails as determined by her engagement level; preferences; email, Web and social behavior; and other factors. Engagement-based emailing is a key part of that equation.