Email marketing for SaaS: Drive sales, enhance retention, and own your market.
Email marketing is one of the most effective channels for your business to communicate with your customers. However, not all emails are created equal, and one of the factors that determine an email's success is its level of personalization. Personalization has become a popular buzzword in email marketing, but it's not just a trend; it's a necessity.
In this post, we will explore the best practices for email personalization, the risks of going overboard with personalization, and the role of personalization in subject lines. This is coming from my perspective of working with predominantly B2B SaaS companies as well as research across all industries, so I hope this will be helpful to you and your company.
Why is personalization important?
Personalization is important because it allows you to connect with your customers on a deeper level. When an email feels personalized, it's more likely to be opened, read, and to drive action (Call-To-Action (CTA) clicks, trial sign-ups, demo requests, or purchases).
According to "The Power of Personalization: 2021 Email Marketing Report" by Campaign Monitor, personalized email messages have an open rate that’s 29% higher and a click-through rate that’s 41% higher than non-personalized messages.
Takeaway: Personalization can improve open rates, engagement rates, and ultimately, revenue.
Best practices for email personalization
There are several best practices for email personalization that you should follow to ensure that your emails are effective and well-received.
1. Use the recipient's name
One of the simplest ways to personalize an email is to use the recipient's name. According to an email benchmarks study by Mailchimp, emails that include the recipient's first name 10.64% higher click-through rate than those that don't.
2. Segment your audience
Segmenting your audience allows you to tailor your emails to specific groups of people. For example, you can segment your audience based on demographics, location, or purchase history. According to a study by Econsultancy “Realities of online personalization”, 74% of marketers say that targeted personalization increases customer engagement.
3. Use dynamic (smart) content
Dynamic content allows you to personalize the content of an email based on the recipient's behavior or preferences. For example, if a customer has abandoned a shopping cart, you can send them a personalized email and product recommendations based on their browsing history. According to a study by Hubspot, personalized calls-to-action (CTAs) convert 202% better than default CTAs. How about that as a motivator?
Takeaway: Use the recipient's name in the body, segment your audience, and use dynamic (smart) content to drive more action.
4. Personalize subject lines
The subject line is the first thing that a customer sees when they receive an email, and it can make or break the success of an email. Without the action of opening the email, none of the content matters, because the recipient would not see it!
A study by Yes Lifecycle Marketing found that personalized subject lines increase open rates by 29-50%! However, the same study found that only 22% of emails include a personalized subject line. This presents an opportunity for businesses to differentiate themselves and stand out in crowded inboxes.
When personalizing subject lines, you should use one to two personalized properties. This includes using the recipient's name and segmenting the audience.
Takeaway: Personalization in subject lines can increase open rates, and use one to two personalized properties for significantly improved open rates while avoiding spam filters.
5. Avoid too much personalization
As a best practice, it's recommended that you use no more than three to five personalized properties in an email. This allows for enough personalization to create a relevant and engaging experience for the customer, without going overboard and potentially creeping them out.
The exact number of personalized properties that are too many can vary based on the customer and the context of the email. However, in general, if an email includes too many personal details about the recipient, it can come across as creepy and invasive. Customers may feel uncomfortable or like their privacy has been violated.
To avoid being too creepy is to use personalization that is relevant and helpful to the customer. For example, if a customer has recently purchased a product, sending them personalized recommendations for related products can be helpful and not come across as invasive.
Takeaway: It's important to find the right balance between personalization and privacy. You should use no more than three to five personalized properties in an email, and focus on using personalization that is relevant and helpful to the recipient. Don’t just personalize because you can - consider the value that it adds.
6. Be aware of the risks of things breaking
Personalization requires a certain level of technical expertise. If something goes wrong or if there is missing information about a contact, it can break the personalization, and the email can come across as unprofessional or confusing. For example, if an email uses dynamic content, but the content doesn't load properly, the email can look disjointed or incomplete.
There are several risks associated with things breaking in personalized emails. These risks can include:
- Damage to brand reputation
If an email is poorly executed, it can damage a brand's reputation. Customers may view the brand as unprofessional or unreliable, which can lead to a decrease in trust and loyalty.
- Decreased engagement rates
Customers are less likely to engage with an email that is confusing or doesn't make sense. This can lead to lower open rates, click-through rates, and conversion rates.
- Compliance issues
If you collect and use customer data, it must comply with data privacy laws, such as GDPR and CCPA. If personalization goes too far, it can violate these laws, which can result in legal issues and fines - big fines!
Takeaway: The more moving personalization you introduce, the more moving pieces there are - the higher likelihood of breakages in personalized emails, and you should be aware of the risks associated with poor execution. Keep it simple, the risk is not worth the reward.
Email personalization is a powerful tool that can improve engagement, revenue, and customer loyalty. However, we all must be careful not to overdo it, as too much personalization can be creepy and turn off customers. By following best practices, finding the right balance between personalization and privacy, and being aware of the risks, you can leverage the true power of email and build effective and well-received personalized emails.
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Co-founder and CEO at Kalungi, Fadi has helped SaaS companies grow with Inbound Marketing strategy and tactical best practices. as well as Marketing & Sales alignment to generate over $100MM in LTV for companies around the world.