Happy Sunday!
If you’re reading this, good luck in the upcoming week. For us who work in CPG, this is our Era’s Tour!! Even though this is the time when work is the craziest, I live for the midnight Zoom calls where multiple people jump on to solve for something or update an entire promotion at the last minute because sales are on fire. So good luck to you and your full team; you will absolutely crush it this week.
I doubt you’re sitting down too relaxed today, if you’re even reading this newsletter this Sunday at all! But for the next 5 minutes, I hope you’re sitting down, have a beverage in your hand, and you’re ready to dive into Retention 101.
I’m still trying to get some more responses to this survey (click here to submit) to put together a 2024 marketing trends report. If you spend more than $500k/year and complete the survey, email me and I will be picking someone for a 30 minute Zoom/consulting call. Fill out the survey on this link. You’ll also get a gift card for completing. Just reply here that you finished it!
This past week we released one of my favorite episodes of Limited Supply. We talked all about what happened to Smile Direct Club, Dollar Shave Club, the Lululemon x Mirror acquisition, and more. I feel like I live in the tactics, but Moiz is SO good at this macro-market analysis; I feel like I learned so many interesting/helpful tips from the downfall of those brands. Listen to us on Apple Podcasts!
HOOX is running a promotion to get you ready for Q5 and the January wellness push! If you buy a page with us, we’ll make you secondary versions of the hero section (the big above-the-fold block up top) and the shop section. You’ll effectively get two pages out of it. If you get a listicle in your page, you can also spin that out as its own page. Book a call to ask any questions or purchase the package on this special link.
Lastly, Sharma Brands is hiring a graphic designer to join our growing creative team. We produce ads for some of your favorite CPG brands, and we have an incredible track record with hiring and training graphic designers to become performance-first, on-brand designers. Click here to apply or share the link with someone you know!
Alright, I’m done. Let’s get into today’s newsletter…
After last Sunday’s email, which was entirely about what some founders miss when launching their brand, I got a lot of emails asking if I would write up something for Retention 101. That’s what today’s email will cover:
- What is retention marketing
- Retention marketing opportunities
- Supporting tech stack
- Tactics
The first rule of newsletters is to make your content convenient for the reader, so with that in mind, today’s email is intentionally short so you can get back to BFCM activities.
So, WTF is Retention Marketing?
In short, retention marketing is exactly what it sounds like. It’s the strategy and tactics that brands deploy to retain customers and get them to become repeat purchasers, and long-term, loyal fans of your brand. A simpler way I like to think about it, is that retention marketing just keeps your product/service top of mind for someone. They might get an email from you that reminds them they need a new iPhone case, or they might see a great piece of content from you on social media that reminds them why they continue to subscribe to your dog food brand. At the end of the day, the goal is to stay top of mind to earn the next purchase. It’s one-part brand, and one-part retention tactics/channels. We’re going to stick with the tactics and channels for the purpose of today’s newsletter.
All great marketers and founders know, and eventually come to realize when their venture dollars dry up, that acquisition is simply the starting point, but retention and increasing lifetime value is where all of the real money is made. Word of mouth is a lie that first-time founders tell themselves will kick in, but in reality, all focus should be on retention.
What are the tools in a brand’s toolkit for retention marketing?
When it comes to retention marketing, brands have a few key levers that they can pull. These are the ones that immediately come to mind:
- Email programs
- SMS programs
- Mobile apps
- Retargeting ads
- Loyalty & membership programs
- Educational content
- Reminder content
- Surprise and delight discounts and gifting
- VIP experiences
- And the use of tech tools to proactively predict potential churn
Each of these marketing activities play an important role in increasing retention and LTV. Most brands that I see do 1 or maybe 2 of these well right now, but the best brands in the world are executing top tier retention playbooks across all of the above. Of course you need to have a bigger team to execute all of them well, but it’s an investment with a real ROI.
What’s a common tech stack for retention marketing?
These are the tools that the Sharma Brands team likes to use with our clients:
- Klaviyo for email
- Postscript for SMS
- Tapcart for mobile apps
- Gorgias or Kustomer for customer service
- Rebuy for a custom checkout experience
- Stay or Smartrr for subscriptions
- Inveterate for memberships
- Malomo for easy and custom shipment tracking
- KnoCommerce for robust customer surveying
- Churnkey to recover failed payments
- Okendo for loyalty, referrals, and affiliate
- Peel Insights to calculate precise CLTV
- Tandym for branded payments
Disclaimer before you tell me you use another app for something: There are many other tools available but this is our preferred stack.
Let’s Talk Tactics
Now that we understand what retention marketing is, and what levers are available to pull within the opportunity, let’s get into some low-hanging fruit wins. Over the next couple months, I will continue to dive deeper into more tactics around retention — there’s a lot to talk about.
For Email & SMS
The name of the game when it comes to retention and reactivation in the world of email and SMS is, “Segments.”
Depending on the specific customer cohort, you need to segment your comms and campaigns to be as relevant as possible to the end consumer. Start with creating a segment of customers who have only purchased your product once. Send them a custom email and SMS campaign with a unique discount code incentivizing them to purchase again every 3 weeks until they do. Stop the flow after they convert.
If you want to go one layer deeper, start segmenting campaigns based on parameters like geographic location or gender.
Let’s say that you are an apparel brand and you have female customers on the east coast and west coast that you’d like to reactivate. These customers have only purchased from you once before and you want to send them a re-engagement offer in December.
As a marketer, do you think that your offer, creative, and copy should be different for these two cohorts? As someone who has done this hundreds of times for brands, the answer is definitely yes. In the east coast, you can offer a winter parka since it’s getting cold over there, whereas on the west coast you may still be in 72 degrees Fahrenheit / 22 degrees Celsius. Knowing this, you should use copy and imagery in your email and SMS campaigns that support this product, offer, and season.
In general, segments are one of the most powerful tools that brands can use to make campaigns and offers feel as relevant as possible which ultimately leads to higher conversions. The more specificity and customization you have with your marketing here, the better.
TL;DR: The more you can slice and segment your list, and create custom content toward them, the better.
Ads
The same thing can be done with ads. You can segment 1 time customers and repeat customers, and then use retargeting ads + offers to win them back with new and interesting offers and creative. There’s a holistic approach to retention and it’s not just about email and SMS.
Being omnipresent with your offers and showing up in email, sms, and on paid social, is a more holistic way to get customers to see the full picture and have them coming back for more.
To customers who have recently purchased, sometimes you don’t need anything super offer-focused, you just need to keep reminding them with content. I remember in 2017, I ran an ad with the founder of Hint water just thanking people for trying the product and we sent that to a segment of recent purchasers — they ended up with a faster repeat purchase rate. They just saw a video we filmed in the office, forced into their Instagram feed, and then they bought again. No call to action to buy, but it was likely a reminder they should try other flavors, or they’re running low on product.
Use Surveys (with Incentives)
Want to know why your customers are churning or haven’t repurchased? Literally just ask them! One of the best things that brands can do is send surveys (again based on segments like the last purchase date, items purchased, number of orders or units purchased, or total dollars spent) to get real insights on what your consumers either liked or disliked about your products, how they heard about you, why they decided to purchase in the first place, why they haven’t purchased recently/again and any other relevant feedback they might give.
In my opinion, you should always tie these surveys to an incentive to increase completion rate.
You are asking for someone’s time. They should get something in return. Offer a free gift with their next purchase or 20% off their next order, or ask for their shirt size or shoe size and their birthday and send them a free gift when it comes around. These survey responses are invaluable to you and you’ll always get ridiculously valuable insights from it — things that will make you scratch your head and think, “Wow, that’s why people love our product?!”
Don’t pay attention to feedback from commenters. Pay attention to feedback from customers. It’s worth its weight in gold.
What else are you doing for retention?
Reply to this email and let me know, I’m curious what has worked well for you? We just started formally testing retention marketing as a core service at Sharma Brands, so I’ll continue to share insights from client wins and new strategies we test. We’re sharing weekly insights in our SB newsletter (sign up in the footer here).
Okay, onto some fun stuff…
Vendor of the Week:
Chargeflow — Your “Chief Chargeback Officer” for anywhere you collect customer payments, including Shopify, PayPal, Stripe, and others.
About 6 weeks ago, I met with a friend who will do about $80M on Shopify this year, and he said he gets hit with chargebacks from scammers in waves. The worst part is some people just do it because they’re frustrated their order is taking 2 days extra to arrive, or a customer service agent is taking 48 hours to reply instead of 48 minutes. In any case, it really screws you over as a business to get hit with a chargeback — you lose the revenue, the product, and it’s not a good look to Stripe, Shopify, etc.
You can appeal and challenge chargebacks, but anyone who’s done that knows it’s not easy to win chargebacks, especially on PayPal — they almost always side with customers even when there’s clear evidence they are in the wrong. So what’s the solution? It’s Chargeflow.
Chargeflow is an incredible app for any Shopify store. The app monitors all chargebacks, assess if they’re your fault or not, and then writes the appeal for you, using over 50+ data points to compile a proper response. A human agent looks over the response to ensure that it’s legit, and then Chargeflow submits the appeal for you.
The app costs nothing up front, and they only take a small percentage of what they win for you. It’s a win-win. I use Chargeflow for Long Wknd, and I can tell you — it works. The setup took less than 5 minutes. You install the Shopify app, go into it, authenticate Stripe and PayPal, and I was set. Now it monitors, flags, and appeals on its own.
Install Chargeflow for free using this special link, or if you want to learn more about how Chargeflow can benefit your bottom line, book a call with their team on this link.
LP of the Week:
This landing page might be one of my favorites because it’s for someone who I think is an absolute genius: my friend Ramon. If you listen to My First Million, you’ve definitely heard of Ramon on the podcast, but he has two businesses: Alpha Paw and Genius Litter. This is one of many pages we made for Genius Litter.
On this page, I’m really proud of how the HOOX team thoroughly explained the benefits of the product (how your litter color changes by any irregularities within your cat) and also made it easy for cat owners to double or triple their quantity in the shop section. The page is truly beautiful, and if you have a cat, you should definitely be using Genius Litter!
It’s not that people don’t know they should be using a landing page… but the roadblock hits when you try to figure out what content should be talked about, how you should switch up messaging, redesign the shopping/checkout flow, and ensure the page truly converts. That’s why you should hire us at HOOX to build the page for you. We handle UX design, copywriting, UI design, development, QA, and deployment. You’ll own the page in your Unbounce account too, so you can make duplicates, change text, imagery, etc. It’s all drag & drop once it’s live.
Book a call with our team at HOOX on this link, or purchase a landing page and get an extra set of a hero banner and a shop section, for free. You’ll be able to get two landing pages for the price of one. You can purchase that deal on this link!
That's all for this week
Well, I told you it would be a shorter newsletter. Technically, this only ended up being 7 pages, so I was right (kinda). Hopefully, it inspired a thought or you picked up a nugget you can leverage in your own business.
I’m sure you’ve got things to do, so I’ll wrap this up quickly. Have a fantastic Black Friday. If you’re open to it, please DM me on Twitter with how your Black Friday went! We want to discuss it on Limited Supply, but we will exclude saying your brand name (unless you want us to!).
Make sure you get 9 hours of sleep tonight, break a sweat this week, go for walks, stay hydrated, and don’t get too stressed out. You got this.
I’ll see you next Sunday!