Do you ever sit and wonder when is the best time to send an email? Better yet, have you ever followed the rule ‘send on a Tuesday at 10 am’? Have you noticed a significant reduction in your open and click rates of your email program? When was the last time you showed your email marketing a bit of TLC? Do you know if your email is actually worthy of making it to the inbox—and we don’t mean it being delivered?
For episode 03 of the Beyond Business with Synx podcast, we had the opportunity to interview Mike Donelly, the CEO and Co-Founder of Seventh Sense. Seventh Sense is an AI-powered email sending platform that analyzes your customer’s email patterns and data to ensure your marketing email gets sent at the right time and place.
On our podcast, we discuss how many companies today do not tend to their email marketing program as they should be. They’re using a blanketed approach and sending out an email to their customers at a said time because that’s what they read would be the most beneficial. Or, they’re sending too many emails to the same person who is not interacting with their brand over and over again. Mike shares valuable insight into how best to approach email marketing and how to get your email program back as a top marketing channel.
Some of the show highlights include:
- Mike’s background and what led him to start his email marketing platform, Seventh Sense
- How many marketers have the power of data in their hands but they don’t know what to do with it
- The key to email marketing is to invest in it. It is not a free channel. There is an ROI to the time and attention on the other end, the recipient end, of an email program
- There is no silver bullet to email marketing. It’s about optimisation and hard work
- Google and Microsoft are waging a war on spam by building an email sending domain authority score that relies on engagement
- How Seventh Sense allows marketers to send emails at the right time and place by analyzing your customer’s engagement data
- Email fatigue is when a brand sends out too many emails and customers get sick of it. This fatigue will likely lead to unsubscribes, marked as spam, or ignored altogether
- People are just talking in digital channels and most people are just tuning it out, which will affect your domain reputation
- Email is not dead. Email just needs to be invested in.
- If you can learn the ins and outs of email, you can learn the ins and outs of any other part of marketing
- Email is more than acquiring customers. It’s a tool to prevent churn and fallout of customers too
- Seventh Sense customers typically see a 8 to 11% increase in open rates and typically anywhere from 12 to 20% increase in click rates.
Links and Resources
Mike Donnelly on LinkedIn
Seventh Sense on Twitter
Seventh Sense LinkedIn
11 Email Marketing Best Practices by Seventh Sense
Quotes by Mike
- “If you want it to be successful, you treat it as a commodity, you'll get commodity like results”
- “Email engagement is digital body language”
- “Everybody's looking for this silver bullet like to increase things by hundreds of percent. The silver bullets just don't exist. It's all about optimizing.”
CM: Welcome to another episode of the Beyond Business podcast. My name is Charles McKay, and I'll be your host today. Today we had the absolute pleasure of talking to Mike Donnally, the CEO and co-founder of Seventh Sense.
Seventh Sense is a really powerful email tool that's all about getting your email actually read and take action from. We talk about:
- Email fatigue. What does that mean?
- Is email really dead? Which we don't think it is.
- Who owns your email within your organization? Is it the I.T. department or is it actually the marketing department now?
- What metrics really matter with email? Often the metrics that we think are not the metrics that really matter to drive that percentage change within your organization.
Anyway, without further ado, I’m going to handover to a really engaging and good conversation with Mike Donnally. Enjoy.
Who is Mike and what led him to where he is today?
CM: Welcome again to the next week's podcast. Today I'd like to introduce Mike Donnally all the way from the U.S.
I'll let him introduce where he's from and where he's sitting. But really excited today to sit down with Mike, discuss all things email and potentially a little bit more. Welcome to the episode Mike. How are you?
MD: Good. Charles, appreciate you having me. Great to see you. We've obviously had a good relationship here for a couple of years, and obviously, you're all the way across the world. So it's again, great to connect.
CM: Yeah. But we’ve actually talked about doing this for a couple of years too, so it’s finally awesome to sit down and go through it. Excellent. So, Mike, whereabouts in the U.S. are you located?
MD: So I'm right outside in Washington, D.C., in a place called Arlington, Virginia. And in my home office. That's where I'm located physically.
CM: Cool. And for how long? You've pretty much been home office-ing for seven years. Is that right?
MD: Actually longer than that. So, prior to founding Seventh Sense, I was an enterprise — and I'll certainly get into this — But I was an enterprise tech sales rep when I first came out of college, I had more or less two office jobs. That was about four years and that led up to… So I've been working remotely for about 16 years.
CM: Wow, so the current situation is nothing new to you then.
MD: Right. Having the kids home creates a little bit more of a challenge. But, you know. That's the big thing.
CM: Totally. So, what’s your number one homeschooling hack that you've come up with so far?
MD: Homeschooling hack… We've got a lot of recess outside. Force them to go get some energy out.
We've got baseball stuff set up out there, which is their favourite sport. They've got street hockey. We've got a kind of a long driveway and a little bit of a backyard, so we're lucky in that regard. We're not in an apartment or anything. So lots of lots of recess, and we're still trying to figure out that home school.
CM: Totally, totally. Cool. So, let's go back a little bit like you sort of said. You’re from Washington, so did you grow up and live in Washington your whole life?
MD: Yeah, I grew up in northern Virginia... whole life… went away to college. That was actually in southern Virginia. I've also spent a little bit of time living in Maryland, so I've been right here around the D.C. Washington, D.C. metro area my whole life.
CM: Cool. And then so obviously you went to uni. What did you study at uni and where did that start?
MD: Interesting question. So I actually studied geology with a specialty in environmental and engineering geosciences. My first job and this is a kind of a funny story… So, my first job out of college, well the last two years of college, I really got into computer programming. So I worked with one of my professors on an application, and it's actually still used today to determine that rock slope stability on roads.
So, like when you drive by a road cut, you have to study what is the likelihood of slippage of those rocks coming out into the road? My first career, first job out of college was as a software engineer for a biotech company where we mapped the human genome.
There's a gentleman by the name. He's very like in the world of genomic sciences. Him and another gentleman, Francis Collins, who's obviously he's the head of NIA, National Institutes of Health here in the United States. But the gentleman's name is Craig Venter and was having lunch with him and he asked me that exact same question. And he said, what did you major in college?
This is a company of 500 employees… And here I am having lunch with one of the most profound scientists of our lifetime. And I said I majored in geology. He said “geology” and just laughed. “What the hell did geology and biology have in common?” I didn't know how to answer that question. Hey, I enjoyed programming and that's what I started doing to them.
CM: It's fascinating. I love to know where backgrounds start because obviously with what we're trying to do here is talk about businesses that are trying to do, you know, do better and doing things in a much more sustainable way. And I often find that the core of that comes from way, way, way back. So it's interesting that you were studying that so that you can obviously see how scalable, sustainable and if you were actually to implement something that you'd studied it’s there for ideally forever, not just a couple of weeks, which is fascinating.
Cool. So, from then obviously finishing your study. Where did you end up working?
MD: Yeah. So, after Celera as a software engineer. I'd always kind of wanted to build a business and I thought if I could learn how to write some code, that's step one. But how do you really build a business? You got to have some sales skills, so I made the jump to the dark side of sales. Then I was in enterprise tech sales rep for about 13 years, had a ton of success working primarily in startup organizations.
And, you know, had a couple of exits. I worked for two companies where I was very early on where we subsequently had IPOs and then we subsequently… one company we sold for two and a half billion. Another company we sold for a billion, and in the third startup that I worked for, they were on track. Now we'll see if this happens now… they were on track to go public this year. I still own. You know, I obviously still have some ownership stake in that company.
And that's kind of… during that time of being an enterprise rep, that's what led me to founding Seventh Sense.
CM: Yeah, cool so tell me about the problem that, you know, as an enterprise rep. Well, what era was this? This is what mid-2000s is that right?
MD: I started in tech sales in 2002 and then founded Seventh Sense in 2013. But the first two years of the founding of the company I was doing it kind of nights and weekends with my cofounder.
CM: Yeah. Yeah. So in 2002, what was that gradual shift from 2002… what did you do to get a deal to then when you finished that business, you know, working in that industry, what were you doing to get deals, how did that evolve?
MD: Wow. That's a super interesting question.
I don't know… Clearly when we would see deals like there were a lot more decision-makers and opportunities. We also saw really, you know, two recessions happen where funding… it wasn't a lot of. And I think that's why I kind of laugh when people talk about account-based marketing. That's what I did my whole sales career was account-based sales.
I found an industry that I felt like ‘hey, this is an industry that really needs my product.’ Let me figure out a side door that I can get in because I'm competing with huge companies, huge incumbents that have huge fans within those companies.
And so I figured out a small side door that I could get in for a specific application or use case and get it deployed and then the next thing you know it would grow and grow and grow as I met more and more people within the company. So, we're taking that account-based sales approach, which really led to, I think, all of my success.
CM: The seed and grow methodology like we absolutely use that myself. You know, don’t try and sell the whole burger, get a little bit of lettuce in there first.
Cool. So what was the problem as you started Seventh Sense? Obviously, it’s about email delivery and stuff like that, but what was that frustration you and your teams were starting to have?
What Started Seventh Sense
MD: Yeah. So I'll give you that what Seventh Sense today is not what it was meant to be. The problem that I was seeing, and I talked to a lot of my counterparts in sales, and you would find the good reps did this. But we all just had we were all recognizing that digital channels, social ads, email, phone calls, all that… It was just exploding like people literally couldn't keep up with it.
When I would have a conversation with a V.P. or above, like decision-makers, the resounding response from a lot of them when I would say “hey, this project is getting delayed.” And they would say “well, Mike, why is the project getting delayed?” I say, “because you haven't responded to my last three emails. You haven't returned my last three phone calls.”
The resounding response in all of them was “dude I get hundreds of emails a day” And some of these people are people that I have and still have really good relationships with, as some of them were at my wedding. That's how close I became with them.
And the resounding response was “I just I never saw your email, Mike. Like I get hundreds of emails a day. I can't get through it all, let alone engage with it all.”
I would hear funny stories because now I'm starting to formulate an idea about how I can solve this problem. But I would hear things like “Mike, I respond to email between 9-11 in the morning, go to meetings the rest of the day. I come back to my desk, I go to the top of my inbox, I scroll all the way to the bottom and hit shift delete. Delete all my email from the day.”
And I'm like, “well, that's crazy. What happens if you've got an important email that you missed?” “Well if it’s important, you’ll email me again, you’ll email me again.” Well, as a sales rep I can't do that. I can't be a pest to you.
So, what I would do is I would pay attention to “hey if I want to reach Dave at Comms Corp, I knew intuitively that he would respond to me between 9:00 and 11:00 in the morning. Whereas Kyle Mac at National Geographic, he would respond to me between 5:00 and 6:00 o'clock at night and Britt Miller at Discovery Communications, he would respond to me between typically 9:00 to 11:00 o'clock at night because that’s when he would catch up.
So rather than me sitting here and just writing emails when it was convenient for me, which I would still do, I would actually send them to people when I knew intuitively that they would respond to me. It would increase the likelihood of getting a quick response, and also the email not getting through… getting lost in the deluge.
And I can't tell you when we were founding the company, I would hear from so many soldiers. Well, Jeff, always responds to me.” And I'm like, “yeah, you may have sent me an email on Monday and he responds to you on Friday. Guess what that is. That is four days to get a response.”
What do we all want at the end of a quarter? We want four more days in our sales process so that we can close that deal so the more you can chuck it up and do it that way, you can accelerate your deal process.
I would pay attention to these patterns. And, you know, even think about when you're talking to friends or like industry peers like, “Hey, I'm trying to reach Sarah. She's not really responding to me”. “Oh, don't ever call Sarah on Fridays. Sarah plays golf every Friday. Don't you don't even do that.”
Well, we would all change these kinds of anecdotes. And one day I was like, “why am I spending my mental energy trying to figure this out when it's all just sitting there in my data?”
And so we built a prototype. It was actually with an outsourced engineering team at this point, because I hadn't connected with my co-founder. What I wanted to see was could I illuminate people's patterns of behaviour by looking at my email data, like whether they replied to my emails that I'm sending to them. I was like, “oh, my gosh, my intuition is like, really good. It's all right there… That is when these people are responding.
I connected with my co-founder, who was actually a customer of mine. He ran all of the web operations and engineering for National Geographic.com. So he and I connected and he was like, “yeah, I'll work on nights and weekends project with you and we'll see we'll see what happens.”
We took the prototype to a local company that's here in the northern Virginia area here in the states, and we went to their CEO. At the time they had about 500 inside sales reps and told him about what we were doing. And he's like, “this is brilliant. Like, totally makes sense. We're seeing our connect rates drop as far as phone calls, we're seeing our email response rate go down. We're seeing our marketing efforts not paying also as much as they used to.”
And this is 2013. He said, “look, I'll be kind of an alpha customer for you, but I'm not going to pay you until you show me that it actually works.”
So, what we did was we analyzed all of their historical phone data and we tied into their PBX system to look at were people answering their phones… like their customers, business partners, prospects. They're a multi-billion dollar a year company and their CEO says if you can… and this is where the metrics always get messed up, especially in marketing. His thought was, if you can even just move the needle by a fraction of a percent, that is real business value for me.
The first part of the testing, we analyzed all of their historical phone data. At this point, it was about eight years worth of phone data. We then tied back into their custom CRM. They've built their own CRM.
And what a rep used to do was they would come in and say 8:00 or 9:00 in the morning. They would say, here are the 50 people I need to call today. Haven't talked to him in two weeks. I've got an open quote, you know, whatever it might be. And they would smile and dial. Whereas now what they would do is they would go into their call manager and they would press a time button that would say call these people at 9:00 and call these people, call these people at 10:00, and call these people at 11:00. So it would more or less schedule their day for that.
If we had data on somebody what we found was that the reps would connect 37% more efficiently. Their CEO was just blown away.
What we also found, which he uncovered this statistic… The talk time during a predicted time on average was 18% longer.
MD: They immediately became a customer after seeing that data. Today they've got over 1200 sales reps, inside sales reps, and they make anywhere from 70,000-100,000 phone calls every single business day. So it's a huge, massive value. We then tied into their email where rather than a rep just sending an email, the email just goes out at the most profitable time.
So they became a customer. We then went off and pitched. We thought, “oh, everybody tells you got to raise money.” And if I'm getting too many details.
CM: No, no, it’s great.
MD: So, we went off and we actually got introduced to some of the top venture capitalists in the world. Like at the time… Barry Eggers, who was on the board of Snapchat. He's with… Oh, gosh, I can't believe I can remember this, but anyways Ping Li, who's a god at Excel, at one of the top venture companies in the world. Gary Solomon, you know, one of the gods.
We kept hearing from them. And Ping Li said it kind of looked perfectly… If you came in today and you told me you had 10 customers and a $1,000,000 in revenue, I would tell you to get out of my office, not interested. But if you came in and you told me you have a thousand customers and only $100,000 in revenue, I'd probably write you a check. And the reason why I'd write you a check because you built a scalable business model.
Enterprise sales is going to eventually not go away, but it's just very, very hard to execute. So, we came back and we said “all right. Based off of all of the knowledge we learned… and we did get some term sheets, but we decided, hey, you know what, let's self-fund this thing.” So, you know, try to bootstrap it.
We built a product that individual sales reps could sign up for and connect in their email and then get a way to connect Google and Microsoft, and you could even upload your files to it. We tried to start selling it to sales reps and it fell flat on its face. And we couldn't figure out why, and we almost shuttered the company.
Almost said, you know, let's just give up… This is too frustrating. People just don’t perceive this as a big enough problem. But towards the end, a light bulb went off as we had been talking to V.P.s of Sales and CEOs and they were like “this approach you should take to marketing first because marketing has so much data and they don't know what to do with it.”
So, a gentleman by the name of, and God bless his soul, this gentleman named Steve Richards, who's a very well-known guy in the inside sales kind of community, founder of a company called Execvision.
He said, “Hey, I know Mark Roberge at HubSpot. I think this would be awesome for HubSpot. Like, if you could do this, let me set up a call with him.”
So he gets me a call with Mark Roberge. And at this point, Mark Roberge says “hey, we're just about to build what we're calling our Connect program, which is an integration. This just totally makes sense for our customer base. I would love to have you guys build on top HubSpot.”
So, we started building. We got our first 10 customers and got our first 10 customers pretty quickly. We did a bunch of A/B testing and we're able to show those customers and all with statistical relevance to wow this thing is having a really big impact for us.
So, we kept leaning in, building more and more into HubSpot, getting more and more customers. This was back in 2016. We now have hundreds of HubSpot customers on the system. We also built an integration with Marketo. We are thinking about other integration providers, but those are two main focuses today, and that's kind of where we are. So that's the long history.
CM: It’s obviously gone from something you were selling to sales to optimize. And I agree with that CEO that he said if you can shift our percentage, even a micro percentage. I think that's something that especially marketers get confused about, is they try and do things by hundreds of percentages and thousands of percentages. Like sometimes you only need one metric to move the dial. But yeah, it's fascinating to how that has evolved to what problems you are solving today.
What are some of those, not ways that marketers are using it now, but what are you seeing Seventh Sense used for on top of just getting through to the inbox? What insights, what information are people pulling out that is fascinating?
Focusing on the Right Email Metrics and Sending Email at the Right Time
MD: Yeah. So I’ll touch on one other thing that you just made a great comment about, which is understanding metrics. I always refer to what I call the 8% rule, which is a lot. If you can optimize something by 8%... Effectively you can accomplish in 12 months what used to take you 13.
MD: But for some reason, it's very hard for people to wrap your mind around it. And again, as you said, optimization is things that just, you know, everybody's looking for this silver bullet like to increase things by hundreds of percent.
The silver bullets just don't exist. It's all about optimizing. You know, people are trying to cut corners, you know, do growth hacking, etc. You've just got to do the hard work and optimize as you go.
Initially what customers were using us for was purely what we call send-time optimization. It's rather than blasting an email to 5,000, 50,000, 500,000 people at 10:00 a.m. on Tuesday because maybe you read a blog post, says that's a good time, or maybe you've done some A/B testing.
What this system empowers you to do as we go analyze all of what we call engagement data. So it's you know, when is Charles opening emails, when is he clicking on emails? Is he doing that on a mobile device? Is he doing that on a desktop? Then we build an individualized profile on Charles.
And then when Charles is part of that list of 5,000, 50,000, 500,000people, Charles is going to get his email at a personalized time that shows it has the highest likelihood of getting him to engage in that email, open, click it, etc.
Much like you think about… the easiest way to think about send time optimization is, you know, people are getting hundreds of emails today, especially decision-makers. The easiest way to think about it is… why do people invest in search engine optimization SEO? It's to try and get you as high as you can in a Google search, whereas we send time optimization the goal is to try and get you to as close as we can to the top of the inbox when somebody happens to be sitting down and truly engaging with their email.
It doesn't mean that they're not in front of their email and they're deleting things as fast as possible. It’s when are they most likely to engage?
The other component with send-time optimization, which can also have a huge impact, is if I'm researching a problem… when I do a Google search, I'm going to go look at the top five results and I'm going to sign up for all of their newsletters and all of that because I want to evaluate, understand. It's part of that buyer's journey. I want to do as much research as I can upfront.
Well, over time, whoever is at the top of my inbox is going to be the one that gets a majority of my attention. You’re getting the opportunity to educate me because you're always at the top of my inbox versus I can only read so many blog posts or newsletters about a specific problem.
So that's one thing. Send time optimization is what people initially really use us for. What we've seen happen over time is that Google and Microsoft are investing a tremendous amount of resources into fighting a war on spam and I'm not talking about professional spammers that are sending you emails about trying to steal your credit card information. I’m talking about marketers that are just overdoing it with their email programs that people aren't engaging with. The challenge that I think a lot of executive leadership needs to understand because I do talk to marketers who have this frustration, is executives think it's free to send email. We've already bought HubSpot, we've already bought Marketo, you know, whatever.
It's not free for two reasons. Reason number one is the attention on the other end. Yeah, it doesn't really cost us anything to send the email, but to get the attention of the recipients — there's a real cost to that and there's a real return to it. Two, if I just don't care about my email program, like I don’t give it a lot of love and care, the likelihood that I'm actually going to reach the inbox drops significantly.
This goes to where Google and Microsoft are waging a war on spam. Just because HubSpot tells you 99.8% of your emails got delivered— all that means is 99.8% of emails did not bounce. That does not mean they made it to the inbox.
We started seeing this kind of really come to fruition, especially over the last two years. We said “OK, send time optimization is great, but how can we help with this deliverability challenge or what we've termed an inbox challenge?
The first thing that Google and Microsoft really, really look at is… this again has shifted over time… they used to really identify what IP address is this coming from. To understand is this spam or is it not spam. They started, much like in our personal life, we have what's called a credit score, which determines our creditworthiness and whether or not a bank is going to loan us money and how much money is a bank and loan us. Google and Microsoft are building what's called a domain score domain reputation on you, on your organization, and they're looking at how much are people engaging with your emails and if your engagement is not high, then they start penalizing you by putting you in the spam folder.
Corporate email systems will actually just quarantine your email. If I go to my spam filter and clean it out, I won't even see your emails because it's been quarantined by the corporate system.
So, what we started building was an… individualizing on top of send-time optimization... One of the things that we can do with the engagement data is we can build… we have built a machine learning model that more or less to predicts the likelihood that somebody is going to engage.
And we classify that in kind of three areas. For the first 90 days, we build a trend on Charles’ level of engagement. The machine is learning.
Charles’ level of engagement… His trend could be totally different than Sarah’s. And then after that 90 day period, it will actually determine, ‘hey are you more active, meaning your interest level is still there or are you becoming more passive, which means you're losing interest, you're falling below that trend’. That trend is always going to be learning as well. After at least six months, have you completely lost interest or never even expressed interest? You'll then go into an inactive bucket.
We then built tools that allow you to say, ‘hey, you know what? This isn't a super crucial email. Maybe I'm going to turn off sending to passive or inactive audiences because I don't want to continue to hurt my domain reputation.’ And then we built tools that allow you to say, ‘hey, management just came to me and said, hey, we're not reaching our target goal with our email program or with this specific email campaign, I could easily go and dynamically suppress and un-suppress different audiences.’
So it gives you a lot of flexibility in how your how you're treating those different audiences and that that's been a big focus of ours for, I would say, the last two and a half and trying to get people educated and learn why that's important.
CM: Yeah, totally. It makes so much sense. It's just so technical. And I think this is one of the components that you know as if you look at this shift of an organization… Emails were really strictly owned by IT and it was the infrastructure and the systems, and now it's shifted into more of the marketing component and they own nearly more technology than IT.
But if they don't understand how things technically work, they are just like “well, I’ve sent an email, why hasn’t it gone through?”
So tell me about email fatigue. You and I have had quite a few conversations about email fatigue. Tell me what it is and what it means to potentially shift those contacts that you've had in your database that have not engaged to become reengaged. What can you tell us about that?
MD: Yeah. So the first thing that I kind of always recommend is… and again, this comes into investing in your email program versus just kind of.
If you want it to be successful, you treat it as a commodity, you'll get commodity like results is kind of my mantra.
But the first thing is to answer your questions, what is email fatigue. It's hey, I signed up to understand a problem that I have or seek out a solution to a problem that I have. But again, I signed up for your email list and your five competitors. Or you may not even have any competitors, but I've got four problems that I'm trying to solve, and whichever one is educating me more and making it easier and removing friction is probably the one I'm going to lean more towards fixing first.
So email fatigue occurs when brands, just send me too much email and I just get fatigued of it. I'll give you a for instance… go to Nordstrom.com, buy a shirt and the next thing you know, they'll start sending you emails every single day.
I just had this happen where I'm a big baseball fan and I bought some new hats for myself and my kids for what was supposed to be opening day. We bought it from a site called Fanatic's, which is shopMLB.com. Literally, in 21 days, I received 38 emails from them.
And I’m like, I want to buy from Fanatics, but they're overloading me. So I'm either going to do one or two things or three things.
- I’m going unsubscribe, which is ‘hey, you just lost being able to reach me’.
- I’m going to mark it as spam. OK. That's even worse because now you’re hitting my domain score.
- Or three, I'm just going to ignore you, I'm just gonna immediately because I know your brand, I want to buy from you again, I want to know what the sale items are. But I'm just going to immediately delete every single email that you send to me. And you're not even getting my mind. You're not only getting my inbox impression and you're not getting any of that.
Well, they have all the data that tells them and it's in their marketing automation system that I'm not engaging in those emails. So I am fatigued of their brand. What they should be doing, and this can have an immediate impact for people that have shown fatigue, is they should suppress me from all of their mailings. Then once a month, throw me one email.
It's like, you know what, Fanatics used to pepper me with emails every single day and then it went away. And now all of a sudden, boom, I get this email. I'm like I haven’t been on Fanatics in a while… I think it's time for a new hat. New shirt. Let me know. Let me see what’s going on with them?
Whereas you're always going to have your window shoppers and your everyday browsers. For me I'm leaving behind digital signals to say I'm fatigued, I'm tired.
CM: It's fascinating. It tells me, too, that, you know, depending on who's running, that is too focused on net new rather than that client lifetime value. So, what is that overall customer journey look like? Yes, net new… and this is what we talk about going beyond the lead. Look, it's pretty easy to get that lead but how do you get that lead to convert over and over and over and over and over again without burning them out.
I can think of a few stories where I've literally blank them out now. It’s like you send me too much and I don’t want to unsubscribe because I need to know from you, but you just send me so much stuff that I'm just not really interested.
MD: Yeah. It's you know, it's digital body language. And Ivan from our team always puts it perfectly… It's like you and I are having a conversation right now. If you'd totally just turned around and started working on your computer or tuned me out, am I going to sit here and keep talking?
MD: No, I'm not. Well, the same thing happens with these digital channels where we just keep talking and the people are ignoring us. Let's give them some space, give them some room and also the more that you are sending to people that aren't engaging, again, the people that are ignoring you, that starts to become a big ding on your domain reputation.
Which means the people that actually want to hear from you probably can't even hear from you because your emails aren't going to their inbox. That’s what’s called grey email.
CM: Do you know what the metrics are on these domain reputations?
MD: So you can go… like Google Postmasters is the best one that's out there. You do have to send a high enough volume, particularly around at least 10,000 emails a month to get it to get a decent signal from Google. But Google has its Postmasters tool. Yahoo! Or AOL has one. Microsoft has one. But Google is definitely the best one. We always recommend to clients to sign up for.
One of the things that we also built into our app is what we call an active audience, more or less score. What it looks at is every month how many people engaged in at least one email that you sent to them? What is the percentage of that? And at what it's really used… you might have sent me ten emails, you might send me one email. But if I engaged, I count towards that percentage.
What we have found and all it is supposed to give you a really quick barometer that you look at once a month is how much is your active audience. If you're above 30% or more of your audience is engaging with you, at least, on a monthly basis, you're in like really good shape. If you're above 60%t, you're probably not being aggressive enough with your email program and you could probably afford to send more.
If you fall between the 30 to 15% range, which is where we find most organizations, you should probably really start thinking about your segmentation strategy and doing some things there. And then finally, if you fall below 15%, 10 out of 10 times, you're having inboxing problems.
We have yet to find a customer that's under that 15% range and they're not having any level problems of inbox problems… Their domain reputation with Google is really bad.
We actually have done some studies and we're about to release an awesome case study where it's two B2C brands, and I’ll share it with you after the call. They were just sending gobs and gobs and gobs of email in their domain reputation was crap. We said, “look, just start suppressing your passive and your inactive audience for a couple of months.”
Well, a couple of things happened. One - their domain reputation with Google skyrocketed. Two - their open and click rate, of course, skyrocketed. What's even more interesting is the physical number of opens and clicks, even though they were sending less email… The physical number of opens and clicks skyrocketed over 100%.
MD: So they were sending far less email, but the actual number of people that were opening and clicking went up significantly, which was all an indication that they were doing a much better job inboxing. Most recently… So we've got the case study together and all that… we're fighting some internal politics with somebody new in executive leadership and saying, “no, we need to be sending back to all these people.” So they had been sending more email again and they’re going back to their email bad practices. Even though they’re trying to educate leadership that they should not be doing it.
They've now seen, again, their domain reputation, tank. The physical numbers of opens and clicks have really started dropping again. But now they're finally getting that word across to the executive leadership so things are a little bit better off, back to the races with them.
CM: So a theme that happens every year. It comes to December everyone is like 2021 plans, 2021 top ten tips, blah, blah, blah. And no one predicted what was going to happen in 2020, let's be honest.
One of them is always generally, probably for the last five years… email is dead. Email is dead. What can you answer that question with? Is email dead?
MD: So there's a couple of things. One, what other channel is there? Email is the critical linchpin in relationships with customers, but we live in more or less a pull world. So email is a pushed communication tool in a pull world.
But one of the things that I always answer that question with is, “Hey, how do you sign up for a social network account. How do you sign up for anything on the Internet? It's with an email address. Even though I might have a Facebook account, Twitter starts noticing when I'm not logging in and they're sending me emails saying, hey, you should check back.
Actually, email is going to… and it is especially illuminating massive gaps in people's marketing operations.
I think with everything that's been going on recently. Which is, “Hey, we don't have the ad budget that we used to have. We don't have the tradeshow budget that we used to have. The trade shows aren't even happening, which is where we used to collect a lot of our leads. PPC. “
Well, all of us lived through this really great time from a sales and marketing perspective and we amassed these massive databases. Almost every company on the planet amassed these major databases. That is the house that you own. Like you abuse it and you take more care of your social advertising, all that, which is all now getting exposed. That we don't actually own our social audience. We don't own the algorithms who Google displays the PPC ads to. Third party cookies are going away in 2022 by Google, which is gonna make PPC even that much more of a nightmare. Ad tech is going to get demolished because of that.
Well, where is everybody now starting to wake up and realize, oh my gosh, I have this huge email database. Maybe, just maybe I should invest a little bit of time and energy and resources into it? That’s what some of the companies what they are doing now, that are shifting to really making it better. But there's still plenty of organizations are like, well, we should shift our resources to email. Just send emails to everybody, everybody, everybody. So it's a little bit of a mixed bag. But again, I think we’re just going to continually see, and we've said this for few years, a slow resurgence of email as a critical channel. And I think with what's happened in the world today, it's accelerated that.
Seventh Sense's Roadmap to Success
CM: It's fascinating how quickly it moves. I agree with you about that email address. You know, I'm sure people have all got multiple addresses. But which one is being monitored? Which one is being used? Which one is being accessed, blah blah blah. That’s sort of where you come into your own.
Tell us a little bit about obviously from when you started, your business has had a few pivots in even the product and the channels that you're going to, but from that early stage vision to where you are today, give us some insights, how big the team is, and how many customers you got at that high level. Just show how that probably the most typical component was when you said, right, we're going to fund this ourselves rather than getting some cash… What has that road sort of looked like compared to what you initially thought?
MD: That's a great question. It has been exponentially harder than I ever thought it would be. You know, going from the point of well, you know, I personally invested hundreds of thousands of dollars in the business and I'm never going to get it back.
You know, sleepless nights. It's been a roller coaster ride. There's been definitely very high peaks and very, very, very low lows. I think any business owner can attest to that.
In the past six months have become in a position where we have over 400 customers now. We are profitable. In fact, even in todays day and age, we are going to be looking at hiring another member to our team. That's part of our plan for this year.
Right now in this kind of slow period, we're doubling down, investing in more product. We've also been working with a friend of ours doing and he's doing some side work for us and I couldn't be more excited about what’s coming from a product perspective. It's more or less our system will almost feel like it's native inside of HubSpot. It removes their barrier of ‘oh it’s another app I have to log in to use’, which is what we found with sales reps.
The reason why our sales product failed is because the sales reps didn't want another tool to log into. It needed to be in their workflow. We've got some ideas about how we can do that now inside of the workflow.
Google has built some things… We still have the connectors. So, you know, again, I feel more confident now than I did, a year ago. A year ago, I felt more confident than two years ago. Two years ago, I want to kind of jump off a bridge.
CM: I think as these ecosystems are evolving and getting better connected and, you know, the platforms are saying, right, we realized we're not going to try and do everything, but we need best of breed partners. I think that is a really good strategy these days, and just add value where you can. As soon as that problem comes up from someone… And there's probably two components. How aware is that business of the problem? That's one of the biggest things and then where to go to sort of solve that problem. If you're just there and it makes sense and it works, it’s pretty straightforward.
Just on the seven years or eight years of email marketing that you've been building, what would the number one thing that you would say to even a veteran marketer or a new starter that is getting started in their career, what would that be that you would like to share that you think can add real value?
MD: I mean, obviously, I've got a lot of bias, but I do believe email is the most critical channel that every organization has and owns. I would say really investing and kind of learning it.
And you made an excellent, excellent point earlier. I don't think that I've ever actually thought about it this way… That IT used to own email and they used to own the systems of delivering that email and so they actually understood it in a deep way. Whereas marketers don't tend to understand email in a, you know, in a deep way.
Like “what do you mean, it says 99.89% of emails got delivered, I don't have a delivery problem.” I didn't say you had a delivery problem, I said you had an inboxing problem.
It’s funny… if you can learn the ins and outs of the email, you can learn the ins and outs of any other part of marketing from a technical perspective. Case in point, I was just talking with a gentleman that was the Senior Vice President of Marketing for Overstock.com. He was there when they grew from 0 to 300 million.
Guess where he got his start at Overstock.com? Email marketing. He was hired on to be their first email marketer and worked his way through because he understood how to get conversions through communication. And then he started coming up with really good SEO practices and things along those lines, and PPC practices.
CM: Totally because there are so many things you can split test in email too to get blog article ideas. As you know, every part of an email is trackable. You own that audience and if you are adding value to it and then extracting a little bit of value where you can for your own insight… it makes a lot a lot of sense.
This is, you know, that Marcus Sheridan “They Ask, You Answer?” mentality. You deploy that with your marketing. Especially email marketing, it’s going to work, just takes a bit of time.
What about because you have had so much experience with this, a marketer that's placed in a role and has a big exec team that doesn't get it. What advice would you give to that person to get the message across that they've got to listen and not just say, but we've got 30 years of experience and you've had three weeks experience but you can see that there's a massive hole and this is your huge opportunity, but just can't articulate that and get the trust through to that senior team? Have got some tips on that?
Email Marketing is a Commodity and Should be Treated as Such
MD: Yes, it's an interesting problem. So the first and foremost, I think, is for… I couldn't find a tool like this, so I just want to build one. I think one of the problems is there are not enough tools around that show you what the ROI of your email program and how much stuff it actually touches and influences and things like that.
I don't think executives think of it in that way. It's like, hey, it's this free channel. But if you actually go and show them how much email means to an organization. It's not just about acquiring customers, it's also about not having customers churn, educating customers… so email marketing can become even more impactful after the sale.
It can streamline your processes, it can make a better customer. It can present that customer from churning, you know, all of those things. Like I don’t want to throw ads at you about this new feature when you're already an existing customer. Like how many ads do we see from brands that we’re already a customer to? Why is Zoom marketing to me like that?
CM: I think Zoom at the minute is just marketing to the world.
MD: Yeah, exactly, but I'm already paying. Like why are you marketing to me? You should actually be email marketing to me.
So the first of that is really getting the executives to buy in to understand the ROI of their email channel to say, “Hey, look, if we invested just a little bit of money into this. And optimize this as a channel. Look what we could do.”
When you take that approach… like we were recently on with a very large corporation and I was walking him through this tool that we built and the executive leader was like, “oh, my gosh, I never”… (And this was all numbers for them)… “I never thought about email in this way. Like how much revenue it's really impacting, and we can attribute to it. And you're right, if we just invest a little, not millions or even tens of that if we just invest a little bit more time into it. This could have an immense impact. The return on the investment would be 10x 100%.”
CM: So, that leads to my last and final question. Share a couple of success stories that you guys have. Not necessarily just for you guys but for your clients of where they were at and now where they’re at and how they’re starting to push that boundary again.
MD: Yes. So I shared the research from Caresoft earlier. We’ve recently started putting a lot more emphasis on case studies. We’ve got a lot of those to share. I mean, we've done a tremendous amount of testing with customers.
Where they look at, hey, send your email the normal, take your list. As long as it's big enough because we've got to look at statistics to get significant results. It's amazing to me how many marketers want to say, let's split test a list of two thousand people.
That's not gonna you're not going to get enough signal. Then you potentially make bad decisions on that because one may win, but it didn't win because it didn't really win. It was an anomaly.
So we've done a lot of A/B testing with customers. Where we find wins, there is increases in open rate, click rate. Those types of standard metrics, you know, revenue impacted. We're just about to release another case study where they were actually able to attribute additional revenue, truly by catching people at a more optimal time.
So kind of those traditional metrics of open and click rates. What we find is that on average, what we see is about an 8 to 11% increase in open rates and typically anywhere from like 12 to 20% increase in click rates when we do those types of A/B tests. Some we see actually significantly higher.
It all depends on… I don’t want to get into it on this or maybe I'm happy to. But how quickly are you doing A/B testing after implementing Seventh Sense? How biased is your data? Have you always sent an email at 10 a.m. which is going to bias data?
We obviously do certain things to phase some of that bias data out. So increases and opening clicks, but we've seen some customers reach over a 100% increase just from a pure optimization standpoint, a couple of extra minutes with every mailing and I'm doubling now.
We like to under-promise, overdeliver. That's why we say we're from like an 8-12% is what you should expect. That's one side of success.
The other successes we've seen is digging people out of deep holes with regards to inbox. They didn't really know they had an inboxing problem until they actually look into it. So we've provided the tools to, get them to dig themselves out of those problems. And that's where they'll see immense gains with what they're already doing, once they again climb out of that deep hole.
The third area of successes is providing some additional insights that you just didn't know. Insights into your email program. And it's also, you know… There's been when you think about know email marketing, email marketing can be definitely stressful.
Every job can be. But one of the biggest stressors in an email marketers life is “oh my gosh, I’m about to send this email to a million people or 5,000 people or 3,000 people and I’m about to blast it all at once.
Well, because our system spreads email out over time and throttles it. It takes all that stress away. Like we built a pause button. You can pause the sending, fix the issue, wait for the system to come back online, whatever it might be, and then you just go resume sending. So it completely removes that level of stress from an organization or from an email marketing.
CM: Yeah, like I think it's truly fascinating and also to make the world a better place if you can go on that mission to stop as much email – in a nutshell stuff.
I think most people over send and not personalize it enough. In a nutshell, lack of segmentation. Send too often and don't personalize enough. You do all those three things with some data and some smarts you're gonna get results, but it just takes time.
I think that's another thing. If you went in as marketing manager in a new role and said, “I'm just going to fix your email”, they probably just go “next”. You know, you're not going to get the job but that would probably get the results they need, which is it's a backwards way of thinking, but that's often what we do here as well.
So, Mike, we better start to bring this to the ground. It's fascinating how much knowledge you obviously have on email and how business can you can use it in such a better way. I think you're spot on when it comes to if it's free people don't value it.
So, you know, getting a business to go right... If I've got a 100,000 contacts put a value on that, a number per contact or whatever it is, and then you'll start treating it a bit more seriously.
If people want to get in touch with you, what channels are your best channels to get in touch?
MD: First and foremost, email. It's quite simple. Just email@example.com. Then on Twitter, I manage our Twitter accounts @knowingwhen. In alignment with what we do at knowing when. Then LinkedIn as well. We’re very active in those types of communities. But emails is typically the best.
CM: Yeah. Oh, we'll put all of those details in the show notes. This is a great, Mike. I think it's really valuable to our audience. And until next time, I can't wait to see you. Well, I'm not sure when it'll be. We’re not sure if Inbound is on, we don’t know when we’re going to see each other. So I really appreciate you taking the time out.
MD: Yeah, Charles. Great to catch up and you know, I had a blast chatting with you.