November 18 2008

Guest Comment: Offer partners more bang for their buck with digital inserts

New technology makes the online equivalent of 'statement stuffing' very easy and, according to recent research, consumer acceptance is good, so perhaps it's time to consider carrying third party advertising in your order confirmation emails says Response One Group's Damian Coverdale...

Transactional documents such as bills and statements are already, though tentatively, being utilised as an advertising medium. The advent of such advertising — christened with the recently-coined jargon word of 'transpromo' — is not a new phenomenon, although as yet it is rare in the UK, with major brands slow to capitalise on the digital print technology that will enable them to utilise this white space opportunity.

Interestingly, professional insert and list management companies have so far been little involved in the transpromo revolution due to a lack of capabilities, activity and experience in the UK. This will have to change if the medium is to really take off — after all, professional media and list management companies have for many years managed insert programmes in the transactional envelope, so it is a small step to extend this activity to advertising insertions on other transactional communications, including both digital and postal communications.

Thanks to technology innovations in variable data printing, analysts are now predicting an explosion in such activity. This expected escalation in transpromo advertising on bills and statements has driven firms with a large online customer base to start considering alternative media for the delivery of third party advertising.

Every time an ecommerce transaction occurs, the customer is sent an order confirmation by email. The big question, however, is whether consumers closely scrutinise these order confirmations, or even print them out and file them. Should this be the case, then the 'eyeball' time commanded by online order confirmations would make them into a very powerful medium for introducing suitable third party advertising. Early forays into this kind of 'new' advertising medium have tended to call such advertising 'digital inserts', a term more readily recognised and understood by the media buying marketplace.

To evaluate the advertising potential of ecommerce order confirmations, Response One commissioned a study which aimed first to understand opening rates for email and online order confirmations, as well as subsequent print out frequencies. Across Britain, 82% of consumers open and check their order confirmation nine times in every ten.

The advertising opportunity or 'impact' is greatly extended if someone also prints out the order confirmation for filing or further reference. The study therefore quizzed consumers about their tendency to do so; 40% of the population said that they printed their order confirmation post-purchase for filing or future reference.

The research exercise specifically asked respondents whether they were likely to seriously consider clicking through on adverts inserted into their order confirmations, and indeed whether it would be acceptable for that advertising to come from associated third parties. The results confirmed that around half of all consumers would seriously consider responding to such advertising, whether from the same company or from third party firms.

Whilst these findings confirm the potential advertising power of online order confirmations, two caveats should be raised. First, third party advertisers cannot be accepted indiscriminately; they need to be appropriate and relevant to the recipient. Second, the web experience that a consumer encounters when they do click through remains absolutely critical to the conversion of response into actual sales.

Online order confirmations present a significant opportunity for the issuers of those confirmations to monetise this customer contact, and for third party companies to have access to a touchpoint with consumers which offers powerful open rates and attention levels. Digital inserts therefore could lead the way to the further development of transpromo and affinity marketing opportunities.

by Sarah Clark (Web Editor)