AIMultiple ResearchAIMultiple Research

Transactional Email vs Marketing Email: Understanding the Differences

Written by
Cem Dilmegani
Cem Dilmegani
Cem Dilmegani

Cem is the principal analyst at AIMultiple since 2017. AIMultiple informs hundreds of thousands of businesses (as per Similarweb) including 60% of Fortune 500 every month.

Cem's work focuses on how enterprises can leverage new technologies in AI, automation, cybersecurity(including network security, application security), data collection including web data collection and process intelligence.

View Full Profile
Researched by
Sıla Ermut
Sıla Ermut
Sıla Ermut
Sıla Ermut is an industry analyst at AIMultiple focused on email marketing and sales videos. She previously worked as a recruiter in project management and consulting firms. Sıla holds a Master of Science degree in Social Psychology and a Bachelor of Arts degree in International Relations.
View Full Profile
Comparison of transactional emails and marketing emails

The primary goal of transactional email services is to provide necessary information related to a transaction or account, not promote a product or service. Unlike these emails, marketing emails aim to increase sales or customer engagement by encouraging the customer to take a specific action, such as making a purchase, signing up for a service, or engaging with content.

We will discuss what transactional emails and marketing emails are, how they are different, and why it is important to separate them.

What is a transactional email?

Transactional emails are trigger-based and automated emails that are sent as a response to a specific action taken by the user. These emails are expected by the user as part of an interaction with a service and directly related to the user’s action. Therefore, the content of transactional emails is highly personalized and relevant to the user’s recent activity.

Transactional emails utilize SMTP relay and email API protocols to send relevant transactional messages, thereby improving email deliverability. SMTP relay services deliver email messages by directing them through a third party, ensuring secure and dependable delivery to their intended destination. 

Transactional email examples include:

  • order confirmations and updates,
  • password reset request or confirmation emails,
  • account creation and verification email,
  • updates on account activity,
  • online purchase receipts,
  • shipping and delivery confirmation email, including delivery details,
  • feedback surveys.
Uber order confirmation transactional email example

Figure 1: Order confirmation email example by Uber.1

What is a marketing email?

Marketing emails serve various purposes, such as enhancing brand recognition, driving conversions, and expanding your subscriber list. These emails aim to engage with subscribers and provide information while promoting products or services and are often part of a broader marketing campaign.

The content of a marketing email is more broadly focused on the interests of a segment of customers than on an individual’s specific action. These emails may contain some level of personalization, such as using the recipient’s name, but the core message is the same for all recipients within the targeted segment.

Marketing email strategies involve testing subject lines and conducting A/B tests to optimize open rates and click-through rates.

While email marketing tools are highly valuable for supporting marketing efforts and simplifying the marketing process, achieving success still requires a solid understanding of email marketing principles and proactive strategy development to improve your ROI.

Examples of marketing emails are:

  • welcome emails for new customers, including a brief introduction to the company,
  • newsletter emails including industry and company news, product tips, customer stories, brand, event, and special offer announcements,
  • promotional emails about special offers or discounts,
  • lead nurturing emails to support relationships between the company and the subscribers,
  • re-engagement emails,
  • seasonal emails on specific holidays to promote relevant products or offers.
Starbucks welcome email example

Figure 2: Starbucks welcome email example.2

Key differences between marketing and transactional emails

Purpose

The purpose of sending a transactional email is to inform a recipient about order confirmations, shipping notifications, password resets, or account updates. These emails are user-specific, automated, triggered by user action, and necessary for the completion or confirmation of a transaction.

Marketing emails, on the other hand, focus on promoting a product, service, or brand, aiming to increase engagement, inform, or persuade customers. These emails are not personalized to the same extent as transactional emails.

Target audience

Transactional emails are sent on a one-to-one basis to individual users.

Marketing emails are sent based on recipient selection and delivered to specific mailing lists, often based on demographic or behavioral criteria.

Reputation

Marketing and transactional emails are essentially the same type of communication that you’re already sending, whether as part of your marketing campaigns or customer notifications. However, the way they are perceived by recipients can vary significantly, and this would affect the sender’s reputation.

Transactional emails typically contain essential information that users often require and expect, resulting in higher open rates and a higher reputation when compared to marketing emails.

Regulation and security

Transactional email recipients are not required to opt-in to transactional emails, as these emails are considered essential for the completion of a transaction or service that the recipient has requested.

On the other hand, transactional emails are still subject to certain authentication regulations, such as DKIM (DomainKeys Identified Mail) and SPF (Sender Policy Framework), for secure email transmission but are exempt from the CAN-SPAM Act.

Marketing email recipients are required to opt-in to marketing emails to comply with regulations like CAN-SPAM and GDPR. For example, an unsubscribe link is required for marketing emails.

Timing

Transactional emails are sent immediately after the user’s action, and the number of emails is directly related to the frequency of these actions.

The timing of these transactional messages is critical, and real-time delivery is required to remain relevant to the user’s recent activity.

Marketing emails can be scheduled regularly (e.g., weekly newsletters) or timed to match the marketing efforts.

The timing of a marketing email is less crucial compared to transactional emails. The focus of the marketing email is on optimal engagement times rather than immediate action.

Design and branding

The design of a transactional email is simpler as it focuses more on clarity and information. Branding is present, but it is not as prominent as a marketing email.

CTA (Call to Action) buttons are usually included in transactional emails and lead the user to the transaction or action taken (e.g., tracking a package).

Marketing email design involves more visually engaging promotional content with a strong emphasis on branding and creativity.

CTA (Call to Action) buttons in marketing emails promote engagement, such as visiting a website, using a promotional code, or learning more about a product or a service.

Why is it important to separate transactional emails and marketing emails?

Marketing and transactional emails pursue distinct objectives, contain different content, and are measured by different success indicators. Therefore, it’s essential to have a clear separation between them to enhance effectiveness and increase customer satisfaction.

To separate your transactional emails from marketing emails, you can follow these steps:

  • Using different sending email addresses or subdomains for transactional and marketing emails,
  • A dedicated IP address for your transactional messages will improve the sender’s reputation.

Here are the reasons why you should separate your transactional and marketing emails:

Deliverability issues: Leveraging the same email server for both types can damage deliverability, as it would be hard for email clients to differentiate between transactional and marketing emails. Separating them into distinct servers reduces confusion, allows timely delivery of transactional emails, and supports your email marketing strategy.

Speed: As recipients anticipate instant messages triggered by their actions, sending large volumes of marketing emails from the same server as your transactional email server may damage the efficiency of transactional emails and the user experience.

Open and click through rate: Transactional email and marketing emails have different open and click rates; therefore, using the same IP address for both of them can negatively impact domain reputation.

Regulatory compliance: While recipients must opt-in to marketing emails, this is not a requirement for transactional emails. Utilizing different providers for each type ensures regulatory compliance and minimizes the risk of violations.

Personalization: Transactional emails include a higher degree of personalization in line with the individual recipients’ needs, such as password resets, account details, or order information. Marketing emails may lack this level of personalization.

 Further reading

External resources

Cem Dilmegani
Principal Analyst

Cem is the principal analyst at AIMultiple since 2017. AIMultiple informs hundreds of thousands of businesses (as per Similarweb) including 60% of Fortune 500 every month.

Cem's work focuses on how enterprises can leverage new technologies in AI, automation, cybersecurity(including network security, application security), data collection including web data collection and process intelligence.

Cem's work has been cited by leading global publications including Business Insider, Forbes, Washington Post, global firms like Deloitte, HPE, NGOs like World Economic Forum and supranational organizations like European Commission. You can see more reputable companies and media that referenced AIMultiple.

Cem's hands-on enterprise software experience contributes to the insights that he generates. He oversees AIMultiple benchmarks in dynamic application security testing (DAST), data loss prevention (DLP), email marketing and web data collection. Other AIMultiple industry analysts and tech team support Cem in designing, running and evaluating benchmarks.

Throughout his career, Cem served as a tech consultant, tech buyer and tech entrepreneur. He advised enterprises on their technology decisions at McKinsey & Company and Altman Solon for more than a decade. He also published a McKinsey report on digitalization.

He led technology strategy and procurement of a telco while reporting to the CEO. He has also led commercial growth of deep tech company Hypatos that reached a 7 digit annual recurring revenue and a 9 digit valuation from 0 within 2 years. Cem's work in Hypatos was covered by leading technology publications like TechCrunch and Business Insider.

Cem regularly speaks at international technology conferences. He graduated from Bogazici University as a computer engineer and holds an MBA from Columbia Business School.

Sources:

AIMultiple.com Traffic Analytics, Ranking & Audience, Similarweb.
Why Microsoft, IBM, and Google Are Ramping up Efforts on AI Ethics, Business Insider.
Microsoft invests $1 billion in OpenAI to pursue artificial intelligence that’s smarter than we are, Washington Post.
Data management barriers to AI success, Deloitte.
Empowering AI Leadership: AI C-Suite Toolkit, World Economic Forum.
Science, Research and Innovation Performance of the EU, European Commission.
Public-sector digitization: The trillion-dollar challenge, McKinsey & Company.
Hypatos gets $11.8M for a deep learning approach to document processing, TechCrunch.
We got an exclusive look at the pitch deck AI startup Hypatos used to raise $11 million, Business Insider.

To stay up-to-date on B2B tech & accelerate your enterprise:

Follow on

Next to Read

Comments

Your email address will not be published. All fields are required.

0 Comments

Related research