Transactional Email vs Marketing Email
Apr 26, 2023
Running a SaaS business comes with endless responsibilities and challenges. One of the most important (and rewarding) levers that you can and should be pulling is having an effective email marketing strategy.
But all emails aren’t created equal.
In order to fully understand what type of emails should be sent out, when they should be sent out and how they should be sent, one needs to understand the difference between transactional emails and marketing emails.
Transactional emails and marketing emails are two common types of email communication that businesses use to connect with their customers.
While both serve a crucial purpose in building customer relationships and promoting brand loyalty, they differ in terms of their intended audience and overall objectives.
Keep reading as we will explore these two types of emails. Whether you're brand new to email marketing or a seasoned marketer, we will help unpack the similarities and differences between transactional and marketing emails as well as how to leverage these insights to best optimize your email marketing strategy.
What is a transactional email
Transactional emails are automated messages that are triggered by a specific user action, such as a purchase or a password reset request. Transactional emails are intended to provide information or confirm a transaction that has already taken place.
Transactional emails are a 1 to 1 communication.
Common examples of transactional emails include order confirmations, shipping notifications, password reset requests, and account registration confirmations. These emails typically have a high open and click-through rate, as they are highly relevant and timely to the recipient.
Because transactional emails are triggered by a specific user action, they should be sent immediately following the trigger. For example, if a user of your product requests a password reset after forgetting theirs and you don’t send them the necessary information and steps until the next day, they have already moved on, possibly forever. You need to send the communications immediately when it will still be highly relevant to your customer.
Due to their highly personalized and relevant nature, transactional emails can help build trust and loyalty with your customers.
In addition to providing timely information to customers, transactional emails can also help businesses reduce customer support requests while increasing revenue. For example, when a user of your SaaS product upgrades from a free to a paid subscription, send them an automated confirmation email that ensures them the upgrade was successful as well as tips on how to best take advantage of the new features of their account.
Transactional emails are an essential component of any email marketing strategy, as they provide a valuable opportunity to automatically connect with customers and drive business growth.
What is a marketing email
Marketing emails, on the other hand, are not triggered by a specific customer action. Instead, sent out by the SaaS company at a time that they see fit.
A marketing email is a type of promotional email that is sent to a list of subscribers or customers with the goal of promoting a product, service, or brand. Marketing emails are typically used to drive customer engagement and revenue.
Marketing emails are a 1 to many communication.
These marketing emails can take many forms, including newsletters, product update emails, special offers, webinar invitations, and customer case studies. The goal of these emails is to capture the attention of your customer and encourage them to take a specific action, such as making a purchase, signing up for a trial, or visiting your website.
Marketing emails typically have a compelling message with a clear call-to-action that encourages the recipient to take immediate action.
By using customer data and segmentation, businesses can tailor these marketing emails to be more relevant and appealing to recipients on a more individual (but not 1:1) basis. This can lead to higher open and click-through rates, as well as improved conversion rates and customer retention.
Marketing emails are a powerful tool for businesses of all sizes looking to promote their brand, engage with their customers, and drive additional revenue.
Transactional emails vs marketing emails: similarities
You may now be thinking that transactional emails and marketing emails may seem like very different types of communication, but there are actually several key similarities between these two types of emails. Here are some of the main similarities:
Both are sent to customers. Both transactional emails and marketing emails are sent to customers or subscribers who have opted in to receive communication from your business. This means that both types of emails have a built-in audience of people who are already interested in your product. These are not cold sales emails.
Both can include branding. Both transactional and marketing emails can include branding such as your company logo, to reinforce your brand identity. This helps to create a strong brand association and increase brand recognition.
Both can be personalized. Both transactional and marketing emails can be personalized based on customer data, such as their purchase history, interests, or location. Personalization can help improve the relevance and effectiveness of both types of emails, by making them more tailored to the individual recipient.
Both can be optimized. Both transactional and marketing emails can be continuously optimized for maximum success. This includes testing different subject lines, copy, and CTAs to see what resonates best with your audience. There will never be a perfect email. Optimize, optimize, optimize.
While transactional and marketing emails may serve different purposes, they share several key similarities that will help drive your business forward. By leveraging the similarities between these two types of emails, your businesses can create a more cohesive and effective email strategy that maximizes customer engagement and revenue.
Transactional emails vs marketing emails: differences
While there are some similarities between transactional emails and marketing emails, there are also several key differences that set them apart. Here are some of the main differences:
Purpose. The primary purpose of transactional emails is to provide the recipient with important information related to a specific transaction or interaction with your company. Marketing emails are designed to promote a product, service, or brand with the goal of driving sales or engagement.
Details. Transactional emails are typically highly personalized and tailored to the specific details of a transaction or interaction, including things like order numbers or shipping information. Marketing emails may be more broadly targeted and in some cases even sent to every single customer.
Frequency. Transactional emails are triggered by specific actions or interactions which makes them sent on an as-needed basis. Some users may receive more transactional emails than others. Marketing emails are often sent on a regular schedule as part of an ongoing email marketing campaign.
Legal requirements. Marketing emails are often subject to legal requirements, such as the CAN-SPAM Act in the United States, which requires that transactional emails contain certain information, such as a way to unsubscribe. Transactional emails do not have the same requirements. This is not legal advice, please speak with your lawyer. :)
Call-to-action. While both types of email *could* have a CTA, transactional emails typically do not include a call-to-action beyond the necessary information related to the transaction that triggered the email. Marketing emails, on the other hand, often include a clear call-to-action that encourages the recipient to take a specific action, such as making a purchase or signing up for a trial.
While transactional emails and marketing emails share the similarities outlined in the section above, they serve very different purposes and are designed to achieve different goals.
Understanding the key differences between these two types of emails is important for businesses looking to successfully communicate with their customers throughout the entire customer journey.
Types of transactional emails
We touched on this a bit above, but it’s important to know what types of transactional emails you may want to send. These are usually related to user accounts, subscriptions, purchases, or other 1:1 transactions. Here are some examples of transactional emails that your SaaS company may wish to send.
These emails are sent to new users when they sign up for your product. They can include instructions on how to get started, links to resources or tutorials, as well as a friendly welcome message from the founder.
Account registration confirmation
These emails are sent to users to confirm their account registration or email address. They can include a confirmation link or code, instructions on how to fully activate the account, as well as a thank you message.
Password reset request
These emails are sent to users who have requested a password reset. They can include a password reset link or code, instructions on how to reset the password, as well as a reminder to keep the password secure going forward.
Subscription receipt invoice
These emails are sent to users to confirm their payment for a product or service. They can include the payment details, the subscription status, as well as overall usage statistics for your account.
Free trial expiration
These emails are sent to users to remind them that their free trial period is about to expire. They can include a call to action to renew the subscription or upgrade to a paid plan so that they don’t lose any data or work inside your product.
Types of marketing emails
Marketing emails are a great way to engage with current customers and also potential customers. Here are some examples of marketing emails that your SaaS company can send to increase brand awareness and revenue.
These emails are designed to promote a specific update to your product or a new feature that has been heavily requested. They should highlight the advantages of the update as well as how to successfully use them.
These emails are designed to increase account upgrades or overall revenue. They can include discount codes, limited-time offers, or special deals.
These emails provide updates and news about the company and its products. They can also include industry insights, customer success stories, and upcoming events told through your brand’s voice.
These emails are sent to customers to gather feedback and opinions about your product. They can include surveys, polls, or requests for reviews or testimonials.
These emails are sent to suggest complementary products or services to customers who have already made a purchase. They can include product recommendations or a list of advantages for an account upgrade.
Webinar or event
These emails are sent to customers or potential customers to share information about an upcoming event where you will display yourself as an industry expert. These events are a great way to solidify relationships with current customers as well as convert potential customers into sales.
Transactional email examples
There are countless examples of ways that your SaaS can leverage transactional emails. Here are some of our favorite examples.
Fathom Analytics sends a weekly report that provides high-level analytic insights to how your websites are performing. These weekly reports keep their product front of mind for the customer and make them more likely to visit their dashboard to dive deeper into the numbers.
Order confirmation or return
Patagonia sends a transactional email when a customer is hoping to make a return. This limits the workload of their customer service reps and allows the customer to return the item on their own time.
Indie Hackers sends a transactional email whenever another user replies to one of your comments, both informing you of an interaction you’re likely interested in as well as hoping you return to reply yourself. This is how they keep the community flywheel running.
Marketing email examples
Just like transactional emails, there are numerous examples of proven marketing emails your team can study to improve your email marketing campaigns. Here are some of our favorite examples.
Handwrytten sent a marketing email letting customers know about their new Saint Paddy's Day Cards! They’re hoping this marketing email will cause an increase in sales and revenue.
SoFi knows that the housing market is crazy right now. They’re hoping that this marketing email will persuade customers to secure their mortgage through them versus a competitor.
New product announcement
The Browser Company sends regular marketing emails for their browser product, Arc, hoping that users will be interested enough in the new features to dive right in and give them a try, increasing usage of their product.
Send both transactional and marketing emails with Loops
When it comes to email marketing for your SaaS company, it is important to fully understand the difference between transactional and marketing emails.
With that understanding, it’s time to put the knowledge to work.
Luckily for you, Loops is the easiest way for your SaaS company to send both transactional and marketing emails on behalf of your company.
Whether you plan to send new product updates, investor updates, forgotten password emails, or the thousands of other emails your SaaS could be utilizing, we’ve got you covered.