Sorry, retailers: Consumers aren’t reading your holiday emails

But personalization, powered by AI, can change that

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Analysts and industry executives agree: Retailers need to step up their email marketing game.

One study of 8 billion marketing messages found that, retail emails increased 15% during last year’s holiday season compared with the rest of the year. But shoppers opened 15% fewer of them. [1]

What’s the problem? According to experts who spoke with the Wall Street Journal’s Suzanne Kapner, retailers simply aren’t crafting messages that feel relevant to their recipients.

One shopper, for instance, described shopping on a retailers’ website for boots, which she didn’t end up buying. The next day, she received an email from the retailer about dresses. No mention of the boots.

“Traditional retailers were once pioneers of using data to zero in on what customers want. But as the importance of their catalogs and mailings have been overtaken by email and other online media, they have struggled — sometimes to the frustration of their customers,” Kapner writes.

The Angle:

If retailers want to keep their customers, they have to get better at understanding their customers’ interests and desires.

How do they do that? Simple, says IBM Watson Marketing Director Jay Henderson: Use AI to send laser-focused messaging to individual customers.

“Customers expect that you cater to their likes, needs, and wants; that you provide them a seamless experience across all their channels; that you provide them relevant content,” Henderson said.

By combining data collected from purchasing and web-browsing with an understanding of emotions and personalities, Henderson said, marketers can craft messages that consumers will actually notice.

“This sort of advanced technology can help businesses recognize their customers during each and every interaction and help them know that customer as an individual— not as a member of a segment or audience, but as an actual person,” Henderson said. “It can also help them understand that customer in the current context. What are they trying to accomplish, in this precise moment? What are they thinking? How do they feel?”

Achieving those kinds of results, Henderson said, isn’t just a priority for this holiday season— it’s an existential imperative. A torrent of new online-only businesses that innovate fast to provide differentiated customer offerings could lure away a retailer’s loyal customers. If retailers want to retain those customers, they need to use data to inform how they interact with customers and create amazing experiences for them.

“Empowered consumers expect and demand personalized shopping experiences no matter how they are shopping,” Henderson said.

Learn more about how IBM’s solutions are transforming retail, from marketing to supply chains.