Ultimate guide: Transactional email explained (what, why and how)

Any time you create a new account, place an order or request a password reset, you receive a transactional email. 

While you’ll be familiar with these emails, you might be wondering how they work. And, as a developer, manager or agency, should you be sending transactional emails too?

We’ve created this simple guide to help you better understand transactional emails and learn if they’re right for your business. We’ll give you the what, why and how of transactional emails including common examples of the different types.

What is a transactional email?

A transactional email is an email sent automatically after a trigger is activated by a user. Just think of your typical e-commerce transaction notifications: invoices, abandoned cart reminders and delivery updates.

Transactional messages are timely and contain valuable information for recipients. They are typically HTML email templates filled with dynamic content, sent using an automation workflow. In many cases, people expect the email to come their way.

Transactional email vs. marketing email differences

Marketing emails are often sent in bulk at a time the sender decides on. Transactional emails, on the other hand, are sent to a person when they perform a specific action on your website, landing page or app (and thus trigger the message themselves).

This is why you’ll see much higher open rates for transactional emails than for promotional emails.

The content of transactional emails is primarily informational and functional. Where marketing emails are promotional in nature, transactional emails share information or offer steps to move a transaction forward (such as account verification emails).

For this reason, people don't need to opt-in for transactional emails. For marketing campaigns, you need permission for sending and you need to give people the opportunity to opt out by providing an unsubscribe link in each email.

That being said, transactional emails present a unique opportunity to build your brand and customer loyalty in more subtle ways. For example, through personalization and reinforcing the brand promise and personality with authentic, human messaging.

Types of transactional emails

As transactional emails are triggered by the recipient, you can imagine how many different types there are (check this article to see some examples of transactional emails).

Jump to a category of your choice

1. Confirmation and invoice emails

2. Specific request emails

3. Event-driven notification emails

4. Behavioral emails

5. Account notification emails

6. Feedback and support emails

Confirmation and invoice emails

How it works: Confirmation emails are triggered after a completed purchase, registration or RSVP. The trigger can be a sign-up or order button on a website, or when the user’s email is verified (and the sign-up process is thereby completed).

Examples: 

• Order confirmations

• Invoice receipt emails

• Shipping confirmations

• Tracking code emails

• Event RSVPs

Tell me more: Let’s take the order confirmation email. The number one rule is: the sooner it arrives, the better. When customers buy something online, they want to receive their purchase receipt fast and straight into their inbox (not their spam folder). Any delays or mishaps can result in a poor user experience and affect their impression of your brand.

These automated email confirmations should contain information that’s useful for the purchaser, such as:

• Product information 

• Call to action to track the purchase, view the order in the browser, rate the order, etc.

• Payment and pricing details

• Shipping details 

• Optional: Instructions or next steps

• Optional: Other product recommendations

Specific request emails

How it works: These time-sensitive emails are triggered by a request or 2-part action the user takes which must be completed via the email. The email content contains the requested information (such as a password reset request link).

Examples: 

• Password reset emails

• Two-factor authentication emails

• Any emails about retrieving lost account information

Tell me more: The most important type in this category is the password reset email. These emails must include:

• A unique URL recipients can click on to enter a new password

• What to do when the recipient didn’t request a reset

• Optional: Instructions on how to update the password

• Optional: If the reset link is only valid for a limited time, mention the expiration time

Event-driven notification emails

How it works: These types of emails are triggered by events performed by other people and the transactional email is used to notify the recipient. 

You’ll find these types of emails used with social media or online community websites, for example, when someone sends a friend request or tags you in a post.

Examples: 

• Social media notifications (friend requests, likes, follows, tags, mentions, reminders, etc)

• Shipment updates (shipped, delivered, delayed, canceled, etc)

• Comment notifications

Tell me more: Let’s look at this automated comment notification from Disqus. Each time someone leaves a blog comment, the admins or authors are automatically notified (if this setting is enabled). The button link redirects to the Disqus dashboard, where blog admins can manage comments and reply to them.

Behavioral emails

How it works: These transactional emails are triggered by a user’s behavior or interaction with your company’s app or website. This can be anything from requesting information to leaving items in the online shopping cart. The main goal of these behavioral emails is relationship-building and re-engaging with customers. 

Examples: 

• Registration-related: Welcome and onboarding emails, FAQ emails

• Site activity: Abandoned cart emails, viewed products, shared posts, site comments, watched videos, or web pages

• App or email activity: Inactivity notifications, emails celebrating engagement (“you’ve used our language-learning app 5 times this week, well done!”)

Tell me more: Let’s have a look at welcome emails. You can set up welcome emails both in your transactional email tool and in your email marketing software. In both situations, the email campaign will be triggered as soon as a subscriber joins a group or completes a form/step (such as clicking the register button or verifying their account).

Welcome emails typically contain information about your business and what to expect. It’s a great chance to leave a lasting impression and start building a relationship. Get people familiar with your business and make them excited about what’s to come!

Below you can see Wise’s welcome email. It shares a quick link to get started, gives useful tips on what to do with a Wise account, plus some FAQs and a link to the help center. The email footer also includes a link to the recipient’s notification settings. 

Note too how the email ends with social proof in the form of a star rating as well as other achievements. This helps to build trust with new users and gives them the confidence they’ve made the right choice.

Account-based notification emails

How it works: These emails are sent whenever a new user creates an account, and then every time something happens in the account—like an invoice that’s overdue or a change in the subscription. Notifications are automatically sent according to the rules you define so there’s no need to manually keep checking subscriber accounts.

Examples: 

• Account creation emails

• Account verification emails

• Overdue invoices

• Failed payment emails

• Trial expiration emails

• Password changes

• Plan upgrades or changes

• Log in verification notifications

Tell me more: About account verification emails? Okay! 

In a world of bots, catfishes and fake princes, it’s important to check whether people are really who they say they are by using an authentication email. This email makes sure people verify their account before it’s marked as completed (and unlocks further features). It’s a simple step and it gives you better-quality users.

Don’t overthink the copy. Just keep it short and simple, instructing readers to click the verify button—like Discord does below.

Feedback and support emails

How it works: After a customer completes an order or talks to your team, it’s nice to follow up and see whether they were satisfied with their experience. The goal of these emails can range from collecting feedback, to encouraging online reviews, or simply informing people their support request was received.

Examples: 

• Post-purchase feedback emails asking for a review

• Post-service feedback emails after contacting support

• Confirmation emails that tell the recipient their support request has been received

Tell me more: Feedback emails are the easiest way to collect information that helps you to improve your services or product. You can make the survey as long as you’d like, though we recommend keeping it short to improve the reply rate. 

Booking.com automatically sends transactional emails with one simple question: How would you rate your stay in one simple click? The answer automatically leads to their review landing page, where customers can elaborate on their answer.

Why email deliverability is crucial for transactional emails

Transactional email messages can make or break the customer experience. Speedy delivery is important as customers request specific information or wait for the next action to take—hence the email delivery should be instant or your brand image may suffer.

For this, you’ll want to use an advanced sending infrastructure so that your messaging arrives directly into the reader’s inbox. This is why it’s super important to pick a transactional email service provider that’s known for its impeccable email deliverability. 

Check out MyWPLife's comparison of the best SMTP service providers for deliverability, including MailerSend.

Time to transact

See what I did there? 😏

We know this was a lot to get through but you’ve made it! Well done! 

Now you’re armed with everything you need to better understand what transactional emails are and the different types you can implement in your email strategy. When done right, transactional emails present lots of opportunities to increase conversions and grow customer relationships.

Let's talk about transactional emails! We'd love to hear which types of emails are most useful for your business. Sound off in the comments!