Christmas in July — Epsilon Study Shows
Key Opportunity for Savvy Email Marketers

DALLAS, TX — July 28, 2008 — There are fewer shopping days (31 days) between Thanksgiving and Christmas in 2008 than in the previous five years which highlights the importance of early season October marketing campaigns to stimulate sales during this abbreviated holiday window, according to an Epsilon study released today.

According to Mike Penney, Executive Vice President, Epsilon, "We recommend that marketers develop a thoughtful strategy for their holiday campaigns early especially during an economic downturn. In fact, we recommend planning for Christmas in July. It’s important this year to factor in a shortened order curve and consider moving up marketing campaigns to October for an early season push. It pays to start early so you’re not competing with as many companies over a short period of time.”

The Holiday Shopper analysis examined retail email activity over a 13-week period (October-December), which includes the traditional holiday shopping window between Thanksgiving and Christmas, and discovered the following:

Survey Highlights:

• Consumers tended to review more emails but completed fewer purchases early in the season (Oct 1-Nov 18). Yet, when they did purchase, their order amounts were higher than average.

• Late season shoppers spent less on each purchase, making a notable push the week prior to Christmas. Consumers may be waiting for last minute discounts or trying to complete their shopping lists and buying stocking stuffers and other last-minute gifts.

• Conversions lagged open and click rates by a week, which may reflect that consumers research gift ideas and then go back a week later to make purchases.

• Heaviest email volumes of the season occurred between December 10-31st, peaking the weeks of 12/10 and 12/17 at 50% the 3-month average.

• Tuesdays and Fridays have been the heaviest email volume days – and peak revenue days; while Wednesday and Sunday had the highest conversion rates.

• Click activity peaked during the week following Thanksgiving, which begins with what has been dubbed Cyber Monday (Dec 1 this year).

Penney suggests, “Our research shows that email messages need to be carefully targeted and marketers need to know their audience and understand their browsing and purchasing behavior. The behavior Epsilon has identified may impact certain industries differently – for example with average order amounts higher early in the holiday season, retailers with big ticket items should send emails before Cyber Monday."

Tips for marketing during the compressed 2008 holiday season:

• There is an inverse relationship between email volume and response metrics like opens and clicks. Marketers tend to think of their competitors as other companies in their industry, but our research suggests that emailers are competing against all other emailers for attention in a consumer’s crowded in-box. It’s especially important to follow creative best practices and have compelling subject lines to stand out.

• Send a series of early season messages with content focused on brand building and commerce. A triggered follow-up message should be delivered to all individuals who open the early season message.

• Factor in a shortened order curve in terms of marketing development and execution as well as business operations.

• Adjust inventory levels and staffing to account for a 10-12% increase in weekly sales between the holidays – with fewer shopping days.

• In order to counter any negative consumer preconceptions of email, create a series of branded, holiday-focused messages that set consumer expectations.

• Schedule email and direct mail earlier in the season and consider combining drop dates and email deployments.

• Focus messages on the week prior to Cyber Monday and the week following to break through in-box clutter.

• During the peak season (mid November – 1st week in December), avoid sending emails on high volume days such as Tuesday or Friday – conversions are higher on low volume days like Wednesday and Sunday.

• Recognize the limitations of late season email to maximize holiday campaigns. Instead, include messaging that targets post-holiday bargain shoppers.

The 2007 Holiday Shopper analysis examined more than 775 million email messages from retail companies who sent email in October, November and December of 2007. The findings also reflect the historical purchasing activity across the Abacus Cooperative database from January 1, 2003 through December 31, 2007.

About Epsilon
Epsilon is the industry's leading marketing services firm. Ad Age ranks Epsilon #1 U.S. Marketing Services Firm and #1 U.S. Direct Marketing Agency. Services include strategic consulting, database and loyalty technology, proprietary data, predictive modeling and a full range of creative and interactive services including brand and promotional development, web design, email deployment, search engine optimization and direct mail production. In addition, Epsilon is the world's largest permission-based email marketer. Epsilon is an Alliance Data company. For more information, visit www.epsilon.com or call 1.800.309.0505.

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