How to increase your sales with smarter transactional emails

Vinay’s Note – Transactional emails tend to have a higher open rate than marketing emails. Here lies an opportunity that most marketers ignore: the opportunity to engage with your leads through every one of these transactional emails. In this post, Owen Powis takes us through how we can increase sales via smarter transactional emails.

Are you sure you know the difference between transactional and marketing emails? Are you using your transactional emails to your full advantage? Make sure you are with this handy guide.

Before we do anything else, let’s clearly differentiate marketing emails from transactional. Marketing emails are easier to define, so lets start there. These are any emails that promote your business. As in, they are sent for marketing purposes, in order to promote or sell your products. Within the US, the technical definition is pretty broad:

“Any electronic mail message, the primary purpose of which is the commercial advertisement or promotion of a commercial product or service.”
CAN-SPAM act

Transactional emails, what I’ll be concentrating on in this article, are different. These are emails which are sent regarding a purchase. So the primary purpose is to inform the customer of the details of a transaction, defined specifically as where the content:

  • “Facilitates or confirms a commercial transaction that the recipient already has agreed to;
    gives warranty, recall, safety, or security information about a product or service;
  • Gives information about a change in terms or features or account balance information regarding a membership, subscription, account, loan or other ongoing commercial relationship;
  • Provides information about an employment relationship or employee benefits; or
    delivers goods or services as part of a transaction that the recipient already has agreed to.”
    CAN-SPAM act

Best practice for sending marketing emails is different than for transactional. In order to send someone a marketing email, they should have opted in to receive them and then confirmed via email. This process is known as a double opt-in.

Crucially, transactional emails serve a very different purpose. There is an expectation from the customer that you will email them to pass on information about their purchase, so they are exempt from much of the regulations marketing emails must adhere to.

This means that transactional emails can be a great opportunity to reach parts of your audience which you otherwise can’t. Importantly, a repeat customer is 9 times more likely to convert than a first time customer and you have a direct route to their inbox.

A repeat customer is 9 times more likely to convert and you have a direct route to their inbox Click To Tweet

Every contact a customer has with your messaging informs their image of you as a brand. Yet how many times have you purchased something from a slick looking website only to receive a plain text email receipt?

transactional emails reciept example

This is an actual receipt but I changed the details so as not to name and shame.

A good place to start is finding out where your transactional emails are actually being sent from. This will usually be either your payment gateway (Stripe, Paypal, etc) or whatever is handling your purchasing/subscriptions (Recurly, S2Member, etc) or a combination of the 2. If you find you have limited options for editing the emails, such as within Stripe, you can use a service like Stunning to add this functionality.

Once you’ve got that bit sorted and know where you’re emails are being sent from, then it’s time to look at smartening them up. Consistency across brand is key, so if you are sending marketing emails, use a simplified version of the same template.

For inspiration, check out this simple example from Amazon. They’ve really thought about the information you need and the point you at which you need it. The most immediate information I’d want to check (where I’m sending something to) has been handily put right at the top:

amazon receipt transactional emails example

Amazon has put some thought into their receipt

You’ll notice in the last content block (I chopped off the footer), they are using it as an opportunity to up-sell other products. The more products I purchase, the more likely I am to purchase again, so it makes so much sense to use this opportunity to show me what else is on offer.

This is marketing content but it’s also very much allowed, you just have to be a little careful how you do it. There are 2 key parts. What the recipient is likely to think the message to be about and what the bulk of the content is concerning:

“If the subject line would lead the recipient to think it’s a commercial message, it’s a commercial message for CAN-SPAM purposes. Similarly, if the bulk of the transactional or relationship part of the message doesn’t appear at the beginning”
CAN-SPAM act

So we can see our Amazon example is clearly showing the transactional content first, which makes up the bulk of the message, then including a small amount of marketing content in an up-sell at the end. That’s a smart way of getting relevant products in front of the highest converting customers.

Combine transactional messaging with a small amount of marketing content for a smart way to upsell Click To Tweet

Just what are dunning emails…

Let’s deal with dunning emails before cancellations. This is a specific type of messaging used when a customer’s payment has failed. These are most commonly used in subscription services where payment will be attempted multiple times before the subscription is cancelled.

Through dunning emails you can notify a customer of the payment problem and give them an opportunity to fix it before the service is cancelled. It’s a great way to rescue what would otherwise be lost revenue.

Like any other customer communication, these should be representative of your brand. So just like your email receipts, use a template and don’t settle for the plain text version. It is also worth heavily pushing your support channels within these. It may be the case that there is a problem, such as updating card details on the account, that a chat with support might help resolve.

dunning transactional emails example

Effective dunning emails could be the easiest win for your business

Take the opportunity to remind the customer how useful the service is; in this example, it shows what the customer will be losing by not updating their details. Merchants typically see failure rates of 5-35%, of which 70-80% is recoverable through dunning. That means you could be leaving anywhere up to 28% of your revenue on the table.

Effective dunning emails could be the lowest cost, easiest to implement, quickest win for your business Click To Tweet

How to get the most from a cancellation

Cancellation emails are really helpful and, depending on which is most important to you, they can be used to address 3 key areas:

Make sure the customer knows what they are missing

Leave the customer smiling, use some humor or just talk about what they have achieved with their product. But make sure the customer is left with a feeling they would be welcomed back if they should return down the line. Here’s the famously cheeky example of ‘Punish Derrick’ from Groupon.

Sell something else

It’s going to be very difficult to resell the cancelled product at this point, however that doesn’t mean the customer won’t be interested in other associated products. You might find you can offer something different that’s a better fit for them. This is an example from a (now pretty old) cancellation email from Mailchimp:

cancellation transactional emails cross sell

If this service isn’t the right fit, here’s something else that might be.

Check out the link to their, at the time, recently acquired service tinyletter. They’ve identified why people are cancelling and are trying to recoup those customers.

It may also be worth trying to get the customer signed up to your marketing list, if they are not already on it. If they are cancelling, they must have been interested enough to purchase in the first place. Leverage this interest and get them on that list. Email is one of the best channels for conversion and, more importantly, retention, so this may be your best bet for creating another sale from them further down the line.

Get all the information you can

An exit survey is a great way to get some additional information about why your customers are leaving you. Here’s an example email which we use within Mailflow:

cancellation transactional emails

This is sent to customers on a specific coupon to try and open up communication between us and the customer

You might choose to embed a survey directly into the email or use a link to direct people off to one. We like to try lots of different approaches and will no doubt be changing this email as we continue to test. However, the main point is to use this as an opportunity to gain more information about your customers. We’re also trying to open up some dialog as well, it’s addressed from me directly rather than Support to achieve a more personal touch.

Transactional emails checklist…

If you want 1 quick win from this article, double check what your receipts and dunning emails look like. It doesn’t take much to neaten them up, even if it’s just the inclusion of a logo and changing the wording.

The key steps covered in this article are:

  • Use a template and make all your outreach match your brand.
  • Create receipts that upsell further services.
  • Use dunning emails to recover lost revenue and push support.
  • Update your cancellation emails to get the most from them.

Transactional emails are an often overlooked part of of customer communication. They actually represent a golden opportunity to communicate with the most active part of your audience, the people who are actually buying things from you.

About

Owen is Co-Founder and CEO of Mailflow. They want you to stop struggling with email automation. They also have a rather good Wordpress plugin.

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