Holiday Clutter Depresses Clicks: Epsilon

As retailers ramped up e-mail volume in the closing weeks of the 2008 holiday shopping season, open and click rates showed a corresponding dip, according to a study just released by marketing services provider Epsilon.

However, click-to-conversion rates during the week prior to Christmas were higher than click-to-conversion rates during the 12 previous weeks and during Christmas week, according to the study of more than 640 million e-mails from Oct. 1 through the end of December.

In other findings, the study determined that retail e-mails’ average order values during the 2008 holiday shopping season dropped 17.5% compared to 2007, and peak revenue per e-mail dropped from 41 cents in 2007 to 23 cents in 2008.

The study also found that average order values from e-mail driven sales in 2008 generally dropped as Christmas approached. For example, three weeks before Thanksgiving week, retailers’ average e-mail order size was $184. By Thanksgiving week it had dropped $154. The week after Thanksgiving, e-mail average order values dropped to $108, then rose to $120 the following week before closing out the holiday shopping season at $91 the week before Christmas and $94 Christmas week, according to Epsilon.

“A couple things may be going on here,” said James Lynn, director, Epsilon’s Strategic Consulting Group. “It could be that consumers are using e-mail to buy a larger number of items early in the season, or they’re buying larger-ticket items early in the season.”

As a result, Lynn said he recommends marketers consider focusing on large-ticket items earlier in the holiday-shopping season and stocking stuffers as Christmas Day approaches.

According to Epsilon, retail e-mail volume in 2008 began to climb the week before Black Friday and continued to do so until peaking the second week before Christmas.

However, the average click rate of retail e-mails peaked at 4% the week after Thanksgiving and dipped to 3.5% the second week before Christmas and even further to 3.1% the week before Christmas, according to the study.

Essentially, as retail e-mail volume climbed, average click rates dropped.

“What this means to an e-mail marketer is that if you can take a look at the big picture and understand when your competitors are marketing, you can be more selective about when you choose to market,” said Thane Stallings, director, Epsilon’s Strategic Consulting Group. “When inboxes fill up, consumers tend to be more selective about what they open and click. It’s not about not sending e-mail. But if you try and send all of your volume in the couple weeks before Christmas, you’re not going to see the kind of response you’d like. If you’re a little bit smarter and you start earlier, I think you’ll get better response.”

But while click rates dropped just before Christmas, retailers’ average click-to-conversion rates were highest the week before the holiday—6.5% compared to 5.3%, 5% and 5.2% the preceding three weeks, respectively—indicating a significant percentage of e-mail-driven sales took place long after the click, according to Epsilon.

Average click-through rates peaked at 4% the week before Thanksgiving week, according to Epsilon. However, they dropped to 2.8% on average Thanksgiving week, 3.7% the following week, and 2.6% and 2.7% during the second week before Christmas and the first, respectively.

As a result, though clicks were a comparatively low 2.7% the week before Christmas, conversions were a relatively high 6.5%.

The study also found that though retail e-mail volume was by far lowest on Saturdays, the day’s click-to-conversion rates were by far the highest. They hit 9.5% on Saturdays compared to 5.5% on Tuesdays and 5.4% on Fridays, the next two highest days, according to the study.

Stallings added that various Epsilon studies have determined that though industry lore has it that Tuesdays are the best day to send e-mail, it actually varies from quarter to quarter.

“The best day to mail is when others are not,” he said. “What we’re seeing is that higher-volume days equate to lower overall response.”