Exposing common lies from agencies (part 1)

I’m writing this newsletter as I’m in the midst of putting together a master email marketing playbook on maximizing customer lifetime values, which will complement my existing playbook on front end customer acquisition.

As I was putting together the email marketing playbook, which will cover strategy, copy, deliverability, and more and will be available for download for all newsletter subscribers soon, I started thinking back to when I started in e-commerce and began to focus on email marketing.

I always believed that maximizing the percentage of revenue attributable to email marketing was the purpose of email marketing.

However, having spent a considerable amount of time auditing and optimizing hundreds of Klaviyo accounts, I’ve realized that email marketing is about maximizing:

1. Customer lifetime values

2. Customer retention, not the percentage of email revenue

3. Short-term cash flow by improving your 30- and 60-day customer lifetime values to reduce the payback period for your customer acquisition costs

Email marketing agencies like to show off Klaviyo screenshots displaying 40%+ email revenue, but this is entirely misguided.

There are three critical reasons for this:

1. When email revenue is above 40% of the total revenue, this indicates that the list is not growing and new customers are not being acquired at a healthy rate. A greater amount of the revenue is being generated from existing subscribers, not new customers being acquired.

2. It’s very easy to manipulate email revenue. For example, you can force customers to open the first welcome sequence email to view their discount code instead of providing the discount code on the sign-up form on the website. The total revenue won’t change, but the attribution will be given to the email instead.

3. Maximizing the percentage of revenue generated from emails may come at the cost of list growth and customer retention as it usually requires many more campaigns to drive more revenue, which can drive a higher unsubscribe rate.

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Check out the post from an email marketing agency owner below. This is perhaps one of the most incorrect takes on email and copy I’ve seen, and it highlights one of the biggest issues with email marketing agencies today.

There are many issues with these points, which are quite common among many email marketing agencies.

Generally, the reason why marketers believe this myth is because they have very little experience with direct response marketing.

Instead, they treat emails as just another impression in the customers’ buying journey.

They limit themselves by only selling to the audience that is aware of both the problem and the potential solution.

They can only sell fish oil to those already looking to buy supplements.

If you’re going to write bland, straightforward copy that lists out the benefits of fish oil, then you will be working with a very limited audience pool.

However, if you are an email marketer or copywriter who understands direct response marketing, you will see your open rates and conversion rates skyrocket.

The post above ignores the truth that copy does influence purchasing decisions.

It can put potential buyers in the right frame of mind to purchase.

This done via a blend of the following:

1. Curiosity to encourage the subscriber to open the email and continue reading

2. Discussion of benefits that address the subscriber’s pain points

3. A relatable story or scenario that triggers key emotions driving the purchase

If you have any experience with direct response marketing, then you’ll recognize the makings of a strong email campaign that can be sent repeatedly to an email list (see an example of a winning email campaign here).

As a counter to the example above, what if the email told an intriguing story of someone who was struggling with high blood pressure, tried all sorts of solutions, and then tried fish oil recommended by a doctor despite numerous doubts?

This scenario would be quite relatable to skeptical readers looking for a way to reduce their high blood pressure (and of course, they wouldn’t be on your email list if they didn’t have at least a mild interest in solving their problems).

Why are advertorials so effective?

Because they lead with a story and agitate pain points and emotions that are then projected onto the product to create desire (check out an example here).

Strong email copy has a similar effect.

Many email marketing agencies mistakenly advocate for “selling the click” and refuse to treat emails like landing pages.

However, when done correctly, email copy will allow you to:

1. Drive higher open rates (with better subject lines)

2. Increase conversion rates (with an emotional angle that resonates with the target audience)

I personally have a significant amount of data supporting the fact that direct response emails with an emotional scenario performs significantly better than straightforward emails discussed in the post above.

Note that you don’t need to make up stories. You can use real life examples from customers, your own experience, and current events.

However, it's important to note that copywriting is just one component of a larger marketing strategy. Even the most well-crafted copy won't necessarily lead to sales if other elements of the marketing mix, such as product quality and pricing, aren't aligned.

That’s what branded direct response marketing is all about: combining the best of both words with high quality products and strong marketing that drives sales.

This concludes part 1 of my series on common lies told by agencies.

In the next edition, we’ll focus on the front end and discuss myths about Meta ads.

Talk soon,

Sharad

@pmktg00

Next Steps

If you own or operate an e-commerce brand generating at least $1,000,000 in annual revenue, feel free to book a call with me to discuss how we can improve your ad creatives, landing pages, or email/SMS marketing strategy.

To further enhance your e-commerce and marketing skills, you may be interested in signing up for one of the options below:

1. Learn branded direct response copywriting and how to create high converting cold traffic funnels here.

2. Learn how to write advertorials here.

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