What is Transactional Email?

Jett Pendleton
Apr. 27, 2018 by Jett Pendleton

Transactional email definition:

Transactional email is a method of customer communication in which automated, real-time messages are sent to users through email after a specific action has been performed within an application or website. Sometimes referred to as ‘triggered emails’ or ‘automated emails’, transactional emails typically contain personalized information that pertains directly to the action taken by the user. Examples of transactional emails include password resets, purchase receipts, shipping notification, and legal notifications. These emails often contain valuable information that is critical to the customer experience.

When implemented correctly, transactional emails can have very high user engagement rates.

Example:

Take the common scenario of needing to reset a password for a given software application account. Once ‘Reset Password’ is selected, users will expect to easily update their password and log back into their account. what is transactional emailIn most cases, software applications send password reset instructions via email, as does SparkPost in this example. transactional emailAfter selecting “Reset Password”, an automated email with password reset instructions is delivered to the user, allowing them to complete the reset and continue using the application. Transactional emails accomplish an agreed-upon transaction between the email sender and recipient, ultimately strengthening user engagement.

Why send transactional emails?

As illustrated above, one of the main goals of sending transactional emails is to instantaneously connect and communicate valuable information to customers at key moments of the customer experience. After all, what customer wouldn’t want on-demand services and communication when they want it most? Much of a great customer experience begins with communication.

Marketing and product communications teams spend a significant amount of time researching the customer journey to understand the most critical moments of customer communication to drive positive relationships.

The following examples of transactional emails are known to have a significant impact on customer relationships:

  • Account creation and activation emails
  • Welcome and onboarding messages
  • User invitations and shares
  • Security and account alerts
  • Password resets and two-factor authentication
  • Purchase receipts and shipping notifications
  • Legal notices

These transactional emails provide essential information to customers and help them successfully manage websites, applications, or software-as-a-service (SaaS) products.

Find more examples of great transactional emails here.

Who sends transactional emails?

Most businesses send transactional emails or app-generated notifications in some form or another, whether it’s in the form of delivery receipts, account creation notifications, user invites, and more.

Many SaaS businesses excute transactional emails by directly embed an email delivery service into a website or application. This can be done through an email API integration which gives product teams the power to take control of how they communicate with customers via email sent directly from their app or website.

Transactional email for SaaS businesses

Successful SaaS businesses view transactional emails as an integral component of their customer communication and engagement strategy. Communicating with customers instantly and at valuable moments of the customer journey can increase product adoption, brand loyalty, and reduce churn. In some cases, transactional emails are utilized as core product features.

Transactional email and the customer journey

It’s clear that transactional emails are essential throughout the user lifecycle and when implemented correctly, can significantly improve engagement, retention, and conversion.

Account creation emails, onboarding welcome messages, password resets and notifications, and other types of transactional emails are perfect opportunities for organizations to communicate with customers and should be seen as opportunities to build stronger relationships. To a certain degree, transactional emails are standard methods of business-to-consumer communication that are expected by consumers in order for them to stay loyal.

How to improve the transactional emails you send

Recently, SparkPost surveyed more than 1,800 SaaS, e-commerce, and other software businesses to assess how they’re using transactional email. Our experts analyzed the results and developed five core recommendations that will help every SaaS company make the most of transactional email.

You can access the full 2018 Transactional Email Benchmark Report here, but below are a few highlights:

  • Overwhelming majorities of senders see transactional email as important to customer engagement (82%), retention (80%), and conversion (72%)
  • Operational functions remain a core use case for transactional emails, as 45.9% of businesses believe these types of emails hold significant business purpose
  • Though vital to business success, 72.5% of email senders don’t A/B test their transactional emails.

Every business is unique, so it’s critical to truly understand the needs of your customers before making decisions on your transactional email program. With this information as a foundation, you can start sending successful transactional emails today that grow your business.

-Jett

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