LIDS Boosts Email Open, Clickthrough, Conversion Rates Using AI

LIDS, an omnichannel retailer of hats and other athletic apparel, partnered with Salesforce and its artificial intelligence-powered Einstein solution to improve the performance of its email program. Specifically, LIDS is using Einstein to help it get more accurate insight into its subscribers’ engagement and intent, and then customizing messaging for curated lists based on the findings. And the process is working. Consider the following:

• Lids experienced more than a 4x increase in the open rate on new product emails, and a 2.5x increase in average clickthrough rate.
• The marketing team learned that there were more loyal customers that were constantly engaging with emails than the previous data analysis showed, and the team was able to see which of its subscribers were the least engaged, helping Lids take more proactive action across its customer base.
• Not only is Lids reaching its various email targets for the year, the insights gathered will help the team to drive more personalized content to subscribers, including identifying promotional offers to send.

In this interview, Wendy Mudis, director of digital advertising at LIDS, discusses the retailer's use of AI, and the impact the technology is having on its email program and the company as a whole.

Wendy Mudis, Director of Digital Advertising, LIDS

Total Retail: With some many different technologies in the marketplace, why has LIDS decided to invest in artificial intelligence and predictive analytics?
Wendy Mudis: I think that most companies are looking for ways to either automate or utilize resources better, and really artificial intelligence is a tool to help people do their jobs better without having to add human capital. And then real time is the objective — reach people at the right time with the right message — and there’s just no way to do that in a manual form. We’ve explored this technology [AI and predictive analytics] not just in the email space, but we’ve also been testing some tools in the social space. It’s really becoming intertwined with any technology that you’re using — there’s some AI component coming.

TR: When did LIDS go through the vetting process for an AI and predictive analytics solution, and ultimately end up going live with Salesforce Einstein?
WM: LIDS has been a Salesforce customer since 2014, and just began using Einstein (Engagement Scoring) during the pilot of the product in August 2017.

TR: What are the applications of AI and predictive analytics for LIDS?
WM: We’ve had this philosophy — and it’s not a good one — of batch-and-blast for email marketing. We knew that we needed to get smarter about it. The Einstein tool was really helpful for us in figuring out who really should be targeted with messaging, and how could we get smarter with our email marketing. We wanted to stop bombarding people with messages that are irrelevant to them, and potentially increasing our unsubscribe rate.

What we’ve been testing is how can we take the same messaging and send it to an audience that’s more likely to engage with it. That’s what Einstein has allowed us to do. Rather than sending to millions of people within a database, we can take a fraction of that audience, send them the same message, and get the same return. That helps save on costs — sending email is expensive — and if you’re sending messages that aren’t performing, you’re just wasting money.

For example, we recently had an email that we sent to 7.4 million people, and it generated about $55,000 in revenue. That same message was sent to an Einstein list of 66,000 people, and generated $21,000 in revenue. What Einstein has really helped us do is figure out that there are people on the list that are more likely to engage and convert. We’re able to tap into that audience, which is changing in real time based on the scoring methodology, and send messages to those lists, reducing our cost per email and increasing return.

TR: What are the business benefits that LIDS has realized since it started with Salesforce Einstein?
WM: Since we’re no longer sending to the full list every time, and sending to a more targeted list, we’ve saved on the cost of sending emails while also allowing us to be more relevant to our customers.

We’ve seen an increase in our open rate, and really engagement across the board — open rate, clickthrough rate, and conversion rate. One example we have is a product message that when sent to the full list generated a 5.9 percent open rate. When that same message was sent to the Einstein list, the open rate was 27 percent. So we saw a pretty significant lift for a message that really is just about a new product that’s out.

TR: Has the frequency in which LIDS is sending emails changed since it started working with Salesforce Einstein?
WM: Since implementing Einstein, we’ve definitely sent less to the full list. Those that Einstein is not identifying as an engaged customer are receiving less email from us. We’ve come to realize with Einstein that more email doesn’t mean better performance. Emails are being sent every day; they’re just going to more strategic lists now. So now not every audience member will get every email. The full list before Einstein was receiving around five times a week; now that number is three to four.

TR: How is LIDS planning to use AI and predictive analytics to help grow it business going forward?
WM: We do have the Salesforce Social Studio, so that’s a likely place where we would expand this technology. Social Studio allows us to do all of our social media monitoring, listening, engaging, posting, and analytics across all of our social channels. It’s our one-stop shop to monitor all things social, and it’s also our social customer service hub. I would imagine Einstein would help us identify audiences and messaging that we should be targeting within our social channels.

TR: What's the internal process at LIDS for creating email campaigns using Einstein?
WM: We have weekly meetings to discuss what’s coming up and what our marketing messaging will be, and then we have channel owners. We do have an email marketing manager, who pretty much handles all things email. She will look at what the messaging is, and then will work with Einstein to pull what she thinks is the best list for that message.

The feedback that I’ve gotten from our email marketing manager is that Einstein is the simplest tool that she has ever set up. I find it impressive that Einstein fits so easily into Marketing Cloud, and is very easy to use. You don’t have to be technically inclined to use it, which to me is a tremendous benefit. Technology can be really impressive in what it can do, but if someone doesn’t know how to use it, it’s not going to get utilized.