Second, inertia is a key behavior of humans. Most users will go with the default change offered by Gmail, rather than jump through a number of hoops to revert to the original layout.

Open rates will drop; Too early to comment on user engagement

So how much will be the drop in open rates and user engagement? Well, that’s the billion dollar question. Although human behavior is difficult to predict, our expectation is that this will have a sizable impact on open rates. There have been some initial pointers, but given that it is so early in the game, it is difficult to draw any conclusive insights. Here’s what we know so far:

• This change has not been rolled out to all Gmail users yet. In fact, it appears that it is being done at a slow rate
• Word from MailChimp last week was that they are seeing some early indicators of decreasing open rates, but at a very small scale. Open rates for Gmail recipients have gone down from ~13% to ~12-12.2%. On percentage terms, that’s a 6% drop – not too big, but remember that this change is far from being rolled out completely to all Gmail users

What happens to the funnel after the email has been opened is trickier to predict. It is possible that some consumers will be more likely to click and convert in the tabbed world, given that they might be in the appropriate frame-of-mind. On the other hand, it is quite likely that a large group of consumers will just not bother and delete Promotional emails after a very cursory scan, maybe only looking at the top few emails or the ones that are catchy or seem to be very relevant.

So what should an e-marketer do?

Let’s first start with what should not be done. Our recommendation is that marketers should avoid trying to game the system. The folks in Mountain View are smart. Moreover, they have access to tons of data, as a result of which the algorithm will keep on getting better and better with time. Gaming the system, by reverse engineering Gmail’s classification algorithm, could lead to short-term gains at best. Plus, you don’t want to annoy the big Daddy.

Ok, so what should marketers do? Well, first of all, realize that life will be a tad-more difficult, no doubt about it. The bar for being relevant just got raised. But here are a few thoughts:

1. Track and measure: If you can’t measure it, you can’t fix it. Closely monitor the impact of this change on your users and their behaviors. What is the overall impact on open rates among Gmail users? Are there changes in how people are interacting with promotional emails? Do users tend to go through promotional emails as they are delivered, or are they batch-reading their reads of promotional emails? Is the new feature actually driving more interest and engagement from users, given that they could be in the right frame-of-mind while reviewing your email? Also, look at open rates of your transactional emails (e.g. order status) as well. If you are grouping some promotional material with transactional emails, there is a chance that such messages could get grouped under the Promotions tab. Finally, don’t blindly follow what someone else is doing – do your own measuring and testing.At our end, we will keep reporting the latest industry trends, so stay plugged in.

2. Relevance, Personalization, Optimization: Make your emails much more interesting to your users, so that there is an incentive for them to check-out your email sitting in the Promotions tab. I know, it is easier said than done. But there are a variety of ways you could do this. Understand what appeals to which customers, so that each email is uniquely tailored to explicitly stated or implicitly inferred interests.

This is where “Big Data”, analytics, and statistical modeling come together. We have seen compelling results of such a strategy in our work with clients . The days of one-size-fits-all have long been over. If you are still sending the same message to everyone, let this be your wake-up call.

Also, invest in A/B testing to understand what content and what subject lines matter. If batch-reading is a behavior that starts showing up, test sending out emails at different times and days of the week. Note that with all promotional emails getting lumped together, it is likely that only the latest few get the user’s attention, and all others get deleted / ignored. Translation: You need to figure out how to stay at the top of the tab, much like credit card companies need to figure out how to remain in the top of their customer’s wallets. Note that some of the insights that you have developed around frequency of emails, best time to send emails, etc may no longer hold true.

3. Move to the Primary tab (aka the triple opt-in): Run campaigns to get your Gmail users to move your emails to the Primary tab. This “Yes” button below could well become the holy grail of email marketers We do think that getting users to do this will not be easy, and take rates will be low. Still, there is no one silver bullet, and we believe that this will be an effort worth testing. Step One would be to make sure that your messages are super-relevant (see the point above) and are sent at the right frequency, so that users have a reason to move you to their Primary tab (hint: the “right” frequency can vary by user). Step Two would be convincing users to move your email messages to Primary tab. For this, you need to find out the best ways to convince them to do this for you (hint: test, test, and test). Step Three would be making it easy for users to do it – don’t expect them to figure it out by themselves. A step-by-step graphic will go a long way.

4. Keep investing in other channels: Re-targeting. Facebook. Mobile App. Loyalty Program. Text Messages. If you were thinking that email could serve as your only engagement tool, think again. Try out other channels, while adopting the TAO cycle: Test – Measure – Optimize (and then Repeat).

What do you think about this change? Any early reads on how this is impacting open rates and click rates for you? How are you planning to address this? Let us know. Also, feel free to share this article with your colleagues and thought partners – sharing links are at the top of this page.

Happy Marketing,
Saurabh