What is transactional email and what is it used for?

One of the questions we hear most often at Postmark is: What is the difference between transactional email and bulk or marketing email? In this post, we’ll answer that question in lots of detail. We’ll not only go over the definition of transactional email, but we’ll also give plenty of examples of how it’s used in different web applications.
And don’t forget that Postmark is the best transactional email provider out there!

What is transactional email? #

Transactional email is a type of automated, one-to-one email between a sender and a recipient triggered by events, interactions, or preferences within a service or application, such as:

  • Password resets
  • Welcome emails
  • Shipping notifications
  • Invoices
  • Purchase receipts
  • Account notifications

Transactional emails can help fulfill marketing needs by recovering abandoned carts or re-activating inactive users, but they are primarily functional and provide an anticipated update to an (in)action or a request made by the recipient.

To put it another way, these are emails that recipients expect to receive—and in many cases, will refresh their inbox until they arrive. Unlike promotional emails, which are bulk distributions of the same marketing message to many recipients simultaneously, transactional emails are personalized and typically sent to individuals one at a time.

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What is transactional email used for? 8 use cases #

1. Receipts and confirmations

2. Explicit requests

3. Account-related alerts

4. Behavioral triggers

5. Event-driven notifications

6. Summaries and digests

7. Referrals and invitations

8. Support and feedback requests

1. Receipts and confirmations

The most well-known types of transactional emails are receipts and confirmations: these occur after a transaction has taken place, which is why these types of emails are called transactional in the first place.

When customers receive an email containing information about a purchase they’ve made online, it's usually an order confirmation or a receipt. Things like e-books, PDFs, or any other downloadable goods are typically sent as part of an email receipt as well, as are product keys for software purchases.

However, confirmation emails don’t necessarily have to be related to a monetary transaction: new account sign-ups and event RSVPs also trigger confirmation emails that verify for the user that their sign-up or registration was successful.

2. Explicit requests #

These types of transactional emails contain information explicitly requested by users of an application or service; the requests are typically urgent, meaning users expect these emails to arrive immediately.

One of the most common examples of an explicit request is a password reset. Because users cannot access their accounts without a password, a password reset request comes with an expectation of an immediate response.

Another example of an explicit request is a verification code used in two-factor authorization, where users are required to enter a temporary password in addition to their primary password to gain access to their accounts. As with password resets, users expect verification codes to arrive without delay.
Retrieval of lost product keys and any scenario where missing account-related information is preventing users from gaining access to or activating their accounts usually fall into this category as well.

3. Account-related alerts #

Emails that aren’t explicitly requested by users but are triggered based on changes to their accounts are considered account-related alerts.

Dunning emails
, which remind customers of overdue invoices or failed payment attempts, are an example of account-related alerts. These types of transactional emails keep customers informed of billing issues and also help reduce churn. Without them, customers may not be aware there were problems with payment processing; dunning emails give customers a gentle nudge to update their billing information if their accounts are at risk of being deactivated.

Other examples of account-related alerts include changes to passwords or email addresses, log-in attempt notifications, trial expiration notices, or other account issues.

An example of transactional email delivered to a customer whose payment failed.

4. Behavioral triggers #

Behavioral emails are some of the more marketing-focused of the various transactional email types because they can be used to increase customer loyalty.

Based on their interaction with a service or application, users will receive emails after they have achieved milestones or met certain conditions. One example of behavioral emails is an onboarding email: after creating new accounts, users receive welcome emails to help them get familiar with an application. After a length of time, a second email can educate them about features or check-in to make sure they’re happy with the service.  

Abandoned cart emails and reactivations are also examples of behavioral emails. When customers have filled their carts but haven't finished checking out, they can receive an automated email reminding them of the items they've left behind. Abandoned cart emails can be sent anywhere from a few hours to a day or two later, and they sometimes include special offers to encourage customers to complete their purchase.

Reactivation emails serve a similar purpose. When users haven’t interacted with an application for a length of time, or when they’ve signed up for a service but never used their account, they can receive emails that encourage them to log in again or complete the onboarding process.

5. Event-driven notifications #

These types of emails are similar to mobile phone push notifications, but they happen via email instead. Event-driven notifications can be used to alert users of a wide range of activities, including comment notifications, event reminders, and shipping updates.

Unlike account-related alerts, event-driven notifications don’t typically include actions taken by the recipients themselves, but rather by other people (as in the case of social networks) or by the service itself (such as with reminders or status updates).

Event-driven notifications can let users know when they have a new message or that they have a tag in a social media post. They can also alert users that a package has been shipped or delivered, or that they have a meeting to attend soon.

6. Summaries and digests #

Instead of receiving individual emails for every notification, some users prefer the option to combine them into groups. Summary or digest emails typically include a log of all the events that have occurred during a specific time frame, such as account activity or comments, and are sent to users at specified intervals, whether daily, weekly, or monthly. Summaries and digests are useful options for users who don’t want to miss notifications about activities that are important to them but don’t want to clutter their inbox with individual emails for every occurrence.

Digest emails aren't limited to activities that have occurred in the past. They can include summaries of events that are planned to happen in the future as well. An example of this is a weekly summary of appointments scheduled for the following week.

7. Referrals and invitations #

Many services provide a way for users to invite their friends or colleagues to create an account by sending referrals and invitation emails. Instead of using their email application to send an invite, users can enter their friends’ email addresses into a form, and the service will send the invitation emails on their behalf.

Referral emails work the same way, but the difference between referral emails and invitations is that referrals are usually incentivized with a benefit for the sender (and sometimes the recipient as well). Examples of rewards include account credits and gift cards.

8. Support and feedback requests #

Communication is essential to positive customer experiences: if a customer submits a support request but does not get a confirmation that it was received, it can be frustrating. Additionally, if a support team does not receive the request promptly, the response time can be delayed, which would not only frustrate the customer but the support team as well. 

Support-based transactional emails help both sides by aiding the communication process and notifying each party of status updates. As with support requests, feedback can also help keep the customer experience positive. 

Similar to how onboarding emails are triggered, feedback requests can also be set up to solicit reviews from customers sometime after they’ve made a purchase or signed up for an account. If poor feedback is received, businesses can contact customers and attempt to turn negative experiences into positive ones.

Wrapping up #

Whether it’s a small team with a mobile application or a robust e-commerce company with thousands of products, transactional email can greatly benefit any business and its customers as well. It can:

  • Increase revenue and engagement through behavioral triggers
  • Lessen the load placed on support teams by automating many requests that would otherwise require manual fulfillment
  • Build customer trust and loyalty through personalization and exceptional communication. 

While it involves discretion to not overload users, transactional email can ultimately help companies provide an excellent experience—which is both great for customers and for the bottom line. Win-win!

If you’d like to learn more about optimizing your application’s transactional email, check out our extensive email design guides that will teach you everything you need to know about how to create beautiful and effective transactional emails. 

Manya Susoev

Manya Susoev

Postmark's resident wordsmith in 2018-2019. Alternative fashion enthusiast, video gamer, book worm, anime otaku, artist, and crafter. Currently living in Las Vegas in a home filled with animals and too many hobby supplies.