Background

Online marketers at L’Occitane En Provence have used email for years to help build excitement about campaigns and entice customers with free shipping and gift-with-purchase offers. Its approach is similar to many retailers who market online and in brick-and-mortar stores; email is a vital sales and communication tool.

As much as possible, the marketing team at L’Occitane recreates the experiential environment of its boutiques in their email campaigns. They refer to these campaigns as ‘windows’ because of their close alignment with boutique windows and in-store displays, which are updated every three weeks.

However, bringing the in-store experience online is a complex task. Capturing the essence of an in-store display takes clever marketing creativity and many resources, while the process for deciding which sales and offers to promote requires rigorous debate and strategic thinking.

Like many marketers, the L’Occitane team had to be careful that it didn’t overwhelm email recipients with too many offers even though it knew it had great bargains and gifts available.

In addition to this challenge, the staff recognised that many consumers today suffer from email overload – increasing email frequency was reaching a point of diminishing returns. Customer engagement through email was declining. The L’Occitane marketing team knew it had to urgently change its email marketing ways.

Client: L’Occitane
Agencies: Coremetrics and e-Dialog

Objectives

For more than 30 years, the fields of Provence and the traditions and techniques of this unspoiled land have been the secret and inspiration behind L’Occitane beauty products. L’Occitane has drawn inspiration from Mediterranean art de vivre and traditional Provencal techniques to create natural beauty products devoted to wellbeing. The company markets its products through boutiques in more than 70 countries, as well as through its usa.loccitane.com website.

L’Occitane marketers faced the challenge of increasing the relevance of email through smarter, more effective segmentation and thorough testing of content and offers.
They needed a solution that would identify behavioural trends among new and existing customers so they could better understand exactly who would be interested in the current main product offer and how they could capitalise on the many secondary in-store offers available. The team also wanted to better understand the evolving shopping habits of their customer base so that its marketing tactics could stay one step ahead.

The end game for L’Occitane was to boost sales and increase customer retention and loyalty. With all the advances in marketing tools today, the team felt sure there was a solution that could help it deliver more targeted email campaigns that matched individual customers’ preferences. The team set about researching the many marketing products and software available, keeping in mind the specific email campaign objectives.

Strategy

After rigorous investigation and research, L’Occitane sought the assistance of online and email marketing services from Coremetrics and e-Dialog. The two solutions come together to enable the marketing team to segment and target customers with high precision. The solutions would allow the team to take a bird’s-eye-view of all email campaigns to see exactly how consumer behaviours and interaction with the company is changing, and whether marketing tactics (new and old) are staying relevant.

With heightened knowledge and data that clearly indicate customer trends and preferences, the L’Occitane team found itself in a position to set new email campaign KPIs around open rates, revenue per email, unique click rates and conversion rates. It was the first time that the team was setting goals and benchmarks for campaigns that were meaningful and that itknew were achievable.

After some discussion and brainstorming, the marketing team then implemented a new email marketing approach.

Execution

As soon as the new solution was implemented, L’Occitane marketers were amazed to see how much behavioural data they now had about every customer. They could browse individual profiles of people’s entire relationship with the online store, looking at important information about products browsed, carted, reviewed and purchased.

Using this newfound knowledge, L’Occitane embarked on an initial campaign called ‘L’Occitane’s Immortelle’, which saw marketers create a segment comprising visitors who recently purchased, carted or browsed products online from its Immortelle skincare line.

They then compared the results of this segment against those of a control group (which hadn’t shown any interest in Immortelle products) using a message containing identical creative and subject line. This was the ideal way for L’Occitane to test the power of the new solution and the new customer information they had at their fingertips.

Results

The results of L’Occitane’s Immortelle campaign were impressive. Key performance indicators for the group that received the targeted email message were off the charts when compared with the control group. A highlight was that the conversion rate was 17 times higher and the revenue per email was 25 times higher than the control group.

During the Immortelle campaign, L’Occitane marketers also tested the effectiveness of offering customers a ‘gift-with-purchase’. Marketers created two versions of the email message for visitors with an affinity for the Immortelle skincare line. The content and subject lines were identical for the two groups except that one included a gift-with-purchase offer in the creative.

As the table below demonstrates, the revenue per email message is 1.5 times higher for the gift-with-purchase group. With this information, the marketers were able to calculate an incremental ROI and determine that the gift-with-purchase offer was a good investment for customers who have a clear product affinity.

Such significant, positive results have L’Occitane marketers convinced that the ability to segment and target customers more precisely is key to increasing the overall performance of the email channel. More personalised messages have also helped keep customer engagement high and drive repeat online purchases; a profound benefit has ensued as a result of simply taking a closer look at what customers are doing online.

Since implementing the new solution, L’Occitane marketers have been able to leverage secondary in-store promotions that previously would not have been included in online campaigns. By matching current offers with customer segments that have demonstrated product affinity, the marketing team has been able to add a whole new layer of email marketing effectiveness to its campaigns.

Where previously they might not have risked the time and resources on certain secondary offers, L’Occitane marketers are now using the secondary offer campaigns as key contributors to the bottom line.