The Q2 2019 Megaphone Report surveyed 55 brands and retailers, which sent a total of 1,928 marketing emails during the survey period of May 15-June 11, 2019.

This Megaphone Report is exclusively available to Plus, Team and Premier Members.

Our research calculates and classifies marketing via two different channels: email marketing and paid digital marketing, which includes Facebook and Instagram. Our analysis of these channels gives you an inside look at how consumer brands and retailers are navigating the marketing landscape, while allowing you to benchmark your own company’s marketing efficiency.

Surveyed companies are identified by Origin (Traditional, meaning it started either offline or both offline and online; or Digital, meaning it started online only) and Type (Brand or Retailer). When relevant, brands and retailers are analyzed separately.

Facebook and Instagram advertising

Loose Threads surveys all active paid Facebook & Instagram advertisements during the middle of each quarter. For special reports, data is captured during the pertinent week, such as during the Black Friday long weekend.

As Facebook and Instagram ads run on the same ad manager, they are surveyed together.

Email marketing

Loose Threads receives emails from each brand and retailer in the Megaphone roster. Our current approach is grounded in surveying how these brands market to a potential customer, versus an existing one.

Methodology update 08/19

Between Q1 and Q2 2019, Facebook discontinued its previous ad manager tool and launched the Facebook Ad Library. The methodology of the Ad Library counts more ads than the old tool, drastically increasing the number of ads to such an extent that certain time-based comparisons (e.g. the number of ads that a company ran in Q1 2019 versus Q2 2019) are not statistically accurate. As a result, we have not included these comparisons in the Q2 2019 Megaphone Report, relying instead on percentage comparisons that are both precise and accurate. Going forward with the Ad Library as our baseline, we will bring these comparisons back once the data is consistent.

Q2 2019 Superlatives

🏆Do I need to ghost you?: The RealReal, who sent 217 marketing emails (an average of more than 18 per week).

🏆Discount queen: The RealReal, with 92.4% of marketing emails featuring discounts, promotions or exploding offers.

🏆Anyone home?: A three-way tie between Hubble, Louis Vuitton and Warby Parker, who sent zero marketing emails.

🏆Social media cleanse: A tie between Dover Street Market, Outlier and Supreme, who only sent email marketing campaigns and evaded paid social altogether.

🏆Sign me up: A six-way tie between Dollar Shave Club, Ralph Lauren, Rebag, Rent the Runway, Stitch Fix and Ulta Beauty, with 100% of emails from these companies featuring signups or downloads.

🏆Loves its customers: Rent the Runway, with 20% of email campaigns featuring customers, not models.

🏆Biggest philanthropist: Brandless, with 58% of emails including information about its philanthropic activities.

🏆Testing you: Stitch Fix, with 44% of emails including a quiz.

Retailers sent three times more emails than brands during the survey period on a relative basis.

  • Dia & Co, who accounted for 3% of total emails from retailers, proved to be the least frequent and the most straightforward. Since many shoppers often move marketing campaigns to their spam or trash, over-emailing only further degrades consumer trust. Since retailers often have more inventory to move than brands, a more segmented strategy would pay dividends. 

Playbook: 

  • How would your open and click rates change if you adjusted your email frequency?
  • How could you justify the extra work of creating more segmented campaigns if the returns are better?

The RealReal sent more emails than any other retailer; Michael Kors sent more emails than any other brand.

  • For the second quarter in a row, The RealReal sent more emails during the survey period than any other retailer—more than 18 per week on average. At the same time, it maintained a low Facebook & Instagram ad output, running only 35 ads in the survey period. The company has seen its stock price fall nearly 50% since its IPO and it is likely trying to keep its foot on the pedal. However, it risks increasing consumer fatigue and diminishing returns with the continued bombardment. 
  • Michael Kors sent more emails than any other brand for the second quarter in a row.
  • Peloton sent only 8 emails, a surprising statistic for a digitally-native company. According to LinkedIn, there are only five employees powering the brand’s digital marketing team, proof that it is relying much more on traditional advertising such as TV and out-of-home.  
  • Dollar Shave Club sent only one email during the survey period, encouraging shoppers to build their starter sets—signaling that the company placed a strong focus on acquiring new customers during Q2 2019.

Companies balanced email marketing and paid digital advertising in Q2 2019 by determining where its target audience spends most of their time.

  • Dollar Shave Club and Ulta Beauty focused heavily on paid Facebook & Instagram ads with little investment in emails in Q2 2019. Dollar Shave Club has relied on viral videos, which spread on social media, as a key advertising channel from its inception. But more recently the strategy has lost effectiveness, which should warrant a shift back to more traditional channels such as email. On the other hand, as the beauty industry becomes more centered around social media and peer-to-peer reviews, Ulta Beauty’s audience is less likely to be in their inbox than on social media. 
  • Supreme sent 9 emails during Q2 2019 and all communicated product launches, a minimal effort to keep its less-engaged followers up to speed on new collections.   
  • Sephora’s massive number of paid digital ads (972) outweighs that of Ulta Beauty (104), which likely means Sephora has a more complex paid digital marketing strategy and targets a wider range of demographics. Even so, according to LinkedIn, only 8% of  Sephora’s 603 marketing employees focus on digital channels. This is comparable to Ulta’s 51 marketing employees, with just over 8% focusing on digital channels. Sephora is able to make the most of Facebook’s ad platform with more resources, driving more efficient customer acquisition as a result.   

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Playbook: Digital marketing vs. email marketing

  • How can you better integrate your email campaigns and paid Facebook & Instagram ads to create a more holistic message?  
  • What do email campaigns allow you to do that paid digital ads don’t, and vice versa?

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The vast majority of email subject lines were straightforward, followed by catchy or clickbait-worthy prose, even more so than in Q1 2019.

  • Catchy and clickbait-worthy subject lines accounted for less than a quarter of emails from both brands and retailers, which was less than last quarter.
  • Subject lines based on urgency comprised the smallest percentage of all emails but were used more in Q2 than Q1 2019.  
  • Dia & Co used a less-is-more approach with all 31 of its email’s subject lines falling into the “straightforward” category.   
  • Peloton had the highest percentage of urgency-related subject lines (50%), followed by Casper (42.86%) and Ralph Lauren (36.36%). Peloton and Casper’s subject lines might have signaled urgency as both brands are building their audiences, proving their businesses are built on one-time or infrequent purchases that may require more pressing messaging.
  • Urgent subject lines were also used around events, like Mother’s Day and Father’s Day. With only 8 emails sent during Q2 2019, Peloton tried to send fewer emails but hoped that each one grabbed the viewer’s attention with an urgent subject line. In contrast, Casper sent nearly three times as many emails (21) but fewer contained urgent messages. While this gave Casper shoppers a more balanced tone, the increased frequency (at least one a week) starts to ring hollow for such an infrequent purchase.  
  • Subject lines that aimed to persuade customers to shop sooner rather than later often felt stale, recycled and infomercial-like:
    • “Hours left to save on zzz’s for Dad…” (Casper)
    • “Last Chance! Get a Free Welcome Gift for Mom” (Peloton)
    • “30% Off Starts Now! Time to Shop Warm-Weather Styles” (Ralph Lauren)
    • “Don’t Miss Out: 30% Off Plus an Extra 10% Off Men’s Shirts & Chinos” (Ralph Lauren)

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Playbook: Subject line impact

  • How can you further diversify your subject lines to showcase your brand’s personality without it backfiring? 
  • How can you balance urgency with less FOMO-driven subject lines? 
  • How can you enact an email marketing strategy that does not use discounts or promotions to drive open rates?

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Email marketing remained heavily reliant on transactional content for the third quarter in a row.

  • Approximately 61% of email campaigns from retailers and 63% of emails from brands featured products, indicating that brands continue to use email to drive conversion above everything else.  
  • Among both brands and retailers, the highest percentage of product-centric campaigns featured multiple products. But with vastly more space in email campaigns versus Instagram posts, companies can do more to speak with customers in a creative way: Only 1.53% of email campaigns from retailers and 4.18% of email campaigns from brands featured company content (messaging that promotes the company itself) in Q2 2019.
  • 26% of emails from brands and 28% of emails from retailers aimed to notify recipients of a discount, promotion or exploding offer. Off-price retailer Nordstrom Rack relied heavily on this strategy with 68% of its emails featuring discount notifications. J. Crew was the most discount-heavy brand with 56% of its emails containing promotions. Both Nordstrom Rack and J. Crew have transformed their business models to be dependent on discounting, while the former is a dedicated off-price retailer and the latter has fallen into the off-price trap as its business has declined.

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Playbook: Multi-product visibility in email campaigns

    • How can you balance your marketing content between social media and email marketing to connect with consumers over something non-transactional that can build brand affinity? 
    • How can you feature products indirectly in your email campaigns so you don’t bombard your customers with SKUs at the expense of telling your company’s story?

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Signups and downloads were the most common email attribute for the second quarter in a row among brands (25%) and retailers (36%), followed by discounts and promotions (18% for brands, 25% for retailers).

  • 100% of emails from Rebag, Rent the Runway, Stitch Fix, Ulta Beauty, Dollar Shave Club and Ralph Lauren featured signups or downloads. Rebag and Rent the Runway have made download and signup messaging a mainstay in their advertising, a good way to increase both acquisition and retention.  
  • More than 17% of brand emails included company content—illuminating process, design, factories, research, values, mission, etc.—and more than 6% included educational content—informing customers about something not related to product. These are relatively low percentages, especially for crowded product categories with significant competition. Rent the Runway’s email campaign that profiles fashion designers who are new to its Unlimited service, an opportunity for brands to speak about something larger than their products while still marketing themselves. Rent the Runway is likely doing this to persuade consumers to sign up for a membership or take advantage of the new additions.  

Retailers are doing more to market their inventories with whiteouts (singling out a brand, product category or color) and edits (featuring a curated list of products) compared to Q1 2019.

  • Whiteouts and edits accounted for nearly 18% of email marketing from retailers in Q2 2019. While these campaigns still feature products, they highlight the curatorial abilities of the company. For example, Net-a-Porter sent a campaign, bucketing items together under the label “happy hues.”
  • While a large number of email campaigns this quarter urged recipients to signup for a membership or download their app, these calls to action remained small icons at the bottom of often lengthy messages—a missed opportunity to make this messaging more prominent.

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Playbook: Impactful signup and download messaging

  • If your company offers a membership or operates an app, how can you spotlight these offers in a memorable way? 
  • How can you build your email campaigns around these offerings while still featuring other benefits and products?

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Both retailers and brands placed a greater emphasis on static images versus gifs in Q2 versus Q1 2019.

  • 69% of all emails during Q2 2019 used static images while 30% of emails included gifs. 24% of emails from brands and 41% of emails from retailers contained gifs. As with Q4 2018 and Q1 2019, plain-text emails were only a small percentage of surveyed emails, another missed opportunity to focus more on content over aesthetics.
  • The focus on static images could be linked to a product-specific marketing approach. For retailers like TheRealReal (78% of emails featured static images) and Revolve (98% of emails featured static images), showcasing multiple products at a time limits how much interactive content the eye can handle.  
  • Retailers continued to shift away from gifs, which were more popular during Q4 2018 as a playful way to market product during the holiday season.  
  • Beauty brands Winky Lux and Kylie Cosmetics featured gifs and static images equally in their Q2 marketing emails. Both brands have more limited assortments and more specific hero products, which warrant more focus in email marketing, in addition to gifs resonating with their ultra-feminine ethos and youthful demographic.

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Playbook: The image and its impact

  • Under what circumstances can you combine image types to attract shoppers to your site without weighing down your emails with heavy image assets? 
  • How can you use email marketing to engage your current audience and recruit new consumer groups?

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Testimonial use increased significantly between Q1 2019 (1.4%) and Q2(40%) with Brandless featuring the most (45% of total emails).

  • This shift indicates that brands are transitioning from a corporate-dominated email strategy to a more genuine peer-to-peer marketing approach. Q2 2019’s increase was driven mostly by Brandless, which increased testimonials by 28% this quarter.
  • Brandless was founded as a private label without a built in audience, which meant it had to build its customer base from scratch. This is a tall order in today’s acquisition environment and it turned to testimonials to help accelerate consumer confidence in the brand. But with the company’s recent struggles, this is far from enough to overcome its structural challenges.  
  • Testimonials were not a focus for retailers during Q2 2019. This includes membership-based retailers like Rent the Runway and Stitch Fix as well as resale companies such as TheRealReal and Rebag—none took advantage of testimonials to recruit new members or to help prove their concept to skeptics. Despite the growing popularity of the above retailers, email marketing campaigns featuring actual customer experiences could really help these companies grow and connect with demographics who have little exposure to new retail models.

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Playbook: The power of the people

  • How can you incorporate customer voices in a genuine yet impactful way through either email or social media channels? 
  • How can you source more testimonials from your audience?

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68% of Nordstrom Rack’s emails contained exploding offers, compared to 25% of emails from brands and retailers.

  • Nordstrom Rack placed the most emphasis on exploding offers in Q2 2019, significantly higher than any other retailer or brand surveyed. With the explosion of off-price options, retailers within this space still need to find ways to differentiate. With off-price sales still dominated by in-store sales, Nordstrom Rack might be using these emails to drive traffic to its physical stores, in addition to its online one.  
  • Nordstrom’s full-price business was in line with the overall average (24% of emails included exploding offers). While this is still significantly below its off-price cousin, the percentage is still quite high if it wants to maintain its status as a luxury retailer.
  • Stitch Fix did not send any emails with exploding offers while fellow membership service Dia & Co used exploding offers in 16% of emails and Rent the Runway used them in 18%. 

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Playbook: The art of subtle promotion

  • If you are a retailer or brand with a subscription based model like Stitch Fix or Rent the Runway, how can you use promotions to recruit new members without attracting discount-hungry customers? 
  • How can you use another tool besides exploding offers to attract shoppers?

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