Case Study: How to Grow Your Email List

We firmly believe in the power of email as a great way to communicate with customers and prospects. The challenge, of course, is how to start the email relationship--how to get your customers and prospects to stand up and say that they want to hear from you via email.

That's why I was pleased to see this article in Direct Magazine (which I've included below) about how Bath and Body Works has solved this problem. Their stats on the value of an email address are interesting, too.

Summary:

Bath and Body Works began collecting e-mail addresses from customers just last January and has since built a whopping file of over 10 million addresses.

“By November, we’ll have the largest e-mail file in all of specialty retail,” said Brian Beitler, vice president of customer marketing for Bath and Body Works, at a presentation during eTail 2007 in Washington, DC last week.

A customer’s e-mail address is worth $18 to the company, Beitler added.

Tactics:

To entice customers to give over their electronic addresses, Bath and Body Works offers free tubes of lip gloss. However, they don’t get it on the spot. The company takes a true multi-channel approach.

The gift comes as an offer in customers’ e-mail boxes that they must take back to the store to redeem, Beitler said.

“E-mail is significantly more valuable to us for a store customer than for a Web customer,” he added.

Results:

“When they’re in the store the first time, they make a $24 or $25 transaction,” he said. “When they come back to the store, what do they do? They make another $24 or $25 transaction.”

Part of the reason for success of the young program is that when customers began coming into the store asking about specials offered online, store managers immediately saw the benefit of getting customers’ e-mail addresses. Another reason is pure store traffic volume.

“We make a lot of transactions,” he said.

Also, bringing customers back into the store is a crucial component of the program because of the effect physical contact has on conversion rates, he said.

“We have found that if an associate touches the customer’s hand, our conversion rate goes to 65%,” he said. “This is compared to around 30% otherwise,” he added.

My commentary:
Wow--these are some awesome results! Lesson learned--think about the absolute best offer you can make (and afford). In this case it was a free lip gloss, and then ongoing great deals extended through their email channel. Think about what you can give away to entice your prospects to come to you. Giving value will get you valued customers.