You go to an online store. You purchase something. You checkout. And voila. The transaction is successful.What’s the next thing you do? You check your email for the purchase receipt.

Turns out almost all the world does the same thing – we wait for the email receipt even if we’ve got a receipt at the checkout. Receipt emails (and all post-purchase emails) are part of what’s called the “transactional” email. There’s just one thing you need to know about them (as growth hackers / marketers) – they have the highest open rates amongst all email messages sent to people.

At its core, a transactional email, also known as a triggered email, is generated after a user takes some sort of action. Because of this, transactional emails have 8x the open rates compared to traditional emails. – Mailjet.

Which is why most startups focus on getting the best offers up on their transactional emails. These emails are a gateway to more revenue and increasing the customer lifetime value.

According to research, it’s seven times easier to sell to an existing audience than to someone who doesn’t know about you. – Crazyegg.

But why is it that only a handful of startups are able to get their receipt email growth hacks right?

I studied these emails and a pattern emerged. It’s not so much about email growth hacks as much as it is about behavior patterns. There are 5 core principles that dictate the success of your transactional email messages.Here’s a compilation of those 5 core principles:

  1. One Thing Only

People read transactional emails. They don’t just skim through it. Another interesting stat is people re-open transactional emails more than once.

That gives a false sense of hope; that we can push a lot of messages and people will read. They may read but they may not act if you have multiple things inside your transactional email. That’s why you should focus on getting just one thing done.

  • Share with a friend (to get 50% off).
  • Purchase again to get free shipping.
  • Add another product for a great discount.

There’s a ton of ideas that can get your new customer add more money to the purchase but you can’t give options. That leads to analysis paralysis.Have just one offer at the end of your transactional email – just one. The customer either takes it or leaves it.

Narrowing down to just one option prevents you from confusing the customer – and increases the chance of the action.

 

  1. Build Virality Right Into the Growth Hack

The story of how Hotmail became what it was (just before it sold out to Microsoft) has been told 8.5 million times. One of the most classic growth hacks the company employed was adding a line after the email signature (“PS. Get your free email at Hotmail”).

Virality is what gives companies the exponential boost they need to growth quickly. Your email growth hacks can’t be simple ones like “Get free shipping on your next purchase using this code”. They are not viral.

An example of a growth hack with virality built into it is this:

skillshare

“Invite a friend and both of you get a month free.” (Skillshare)

It’s obvious. This way, your current customer gets you one more user. And so on and so forth. It is important to come up with ways to make your offer viral. That means you have to tweak your offer (or design it) in a way that makes it compulsorily viral.

 

  1. Try Additive Incentives

Ogilvy once said that if an ad works, you shouldn’t try changing it. (That was his version of “if something ain’t broke, don’t fix it”).

The real lesson here is to re-use an idea if it works the first time.

Here’s examples:

  • Company X adds a “Get your next ride free if you refer a friend.” to its transactional emails as a growth hack.
  • This is a one-time offer. You can’t re-use this offer.
  • Company Y adds a “Get $10 off every time you add a new friend.” to its receipt email growth hack.
  • Here’s the nudge: this is not a one-time offer. You can re-use this as many times as you want.
  • While Company Y loses $10 per transaction, it more than makes up for it because it gets a new customer every time someone uses that offer.
  • In the long-run, Company Y has a bigger customer list that it can tap into. And that can mean a lot of growth.

Additive incentives are often seen in a bad light because incubators often tell you that you should try to maximize your revenue. Also, no one wants to keep giving out discounts (unless it’s Wal-Mart). But there’s no way to find out if it works or not without trying it in your market.

Additive incentives work on two levels: it is a growth hack that can help your company grow and it is an incentive that brings people back to you (repeat purchases). And adding them to your transactional emails gives it a greater chance (because, re-open rates are high).

 

  1. Find the “Next Easiest Purchase”

When you design your receipt email growth hack offer, figure out what the next easiest purchase is for the customer who just purchased from you. As an example, the easiest purchase is often the most relevant too.

Dollar Shave Club uses the classic cross-sell:

dollar
In many ways, the “next easiest purchase” hack is really a cross-sell. But we’re extending this to include not just a purchase that adds to the current one but a purchase that the customer is likely to make the next time.

The next easiest purchase is not hard to find out. If you are Uber, the next easiest purchase is an upgrade or a ride back home!

What’s hard is to find out the most optimal, relevant “next easiest purchase” and add the other rules of the growth hack (virality, one thing only) etc. to it.

 

  1. It’s Not Always About “Revenue”

Sure, transactional emails enjoy a superior open-rate and are goldmines for increasing customer lifetime value. But do not let the statistics – and the need for growth – dictate the terms of how you delight your customers.

Sometimes, the simplest of growth hacks are not about getting more money out of the customer but just about delighting the customer in ways that she doesn’t expect. Like how FilterEasy does:

rev
Excited, delighted and happy customers are viral marketing channels themselves. Remember that low-budget movie that spread like wildfire just through word-of-mouth? That’s the kind of an effect people can have when you delight them with your product and service.

The next time you’re adding a growth hack to your receipt emails, don’t forget to apply these five principles.

 

This piece is contributed by Chandru V from around.io.