Shownotes
John shares a counterintuitive strategy for solving customer retention issues. Contrary to popular belief, he suggests that retention and winback often happen more efficiently in non-brand campaigns, especially for businesses with a diverse range of products. He shows a real-life example and shares where you should focus your efforts and budget instead.
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Transcripts
this is counterintuitive to most big brands.
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:And I think that this nugget is
something that people would really want
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:to pay much more closer attention to.
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:because it actually solves two issues.
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:It's a retention and also a win back
that's probably happening with your
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:business today that you don't realize
long story short, cause I'm working on.
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:Be more concise with my
words and slowing down.
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:This is the slowest I've ever
heard you talk, by the way.
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:Oh my God.
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:This is painful.
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:I feel like I'm like a
Eeyore from Winnie the Pooh.
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:Hey guys.
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:so that was even slower.
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:So that, That hurt.
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:So the typically.
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:Brands believe that their retention
comes from a brand campaign, which
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:means that most of the returning
customers come from a brand campaign.
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:This is even more true if you
have a large amount of SKUs, like
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:three or four or 5, 000 SKUs.
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:To break that mold, I want you all
to look at a metric that you may not
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:be looking at, which is the existing
customers of your non brand campaigns.
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:For example, This is the last seven
days of a client that, and I can prove
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:this with data, I will not rab a hole.
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:All of these shopping campaigns
have not one branded term.
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:We've taken a year to make
sure that they are perfect.
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:and they did, they start off very well.
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:But when you look at the amount of
returning transactions in the last
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:seven days, my shopping campaign
brought:
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:Returning clients.
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:My brand campaign brought 333 new clients
and 751 returning clients, meaning that
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:I have a higher ratio of returning in my
brand campaign, but a higher volume of
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:returning in my shopping because we are an
instant gratification, Amazon generation.
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:Now you want something you pull
out your phone, you Google it.
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:You don't see something
and say, I need a dog bed.
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:I really hope the company I
buy my medications from six
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:months ago sells a dog bed.
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:You don't care.
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:You're looking for a dog bed.
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:So a win back campaign is
actually happening on your non
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:brand campaigns, sometimes even
more efficient than your brand.
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:You want to retain customers.
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:Don't spike up your brand spend,
spike up your non brand spend.
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:That is where people are a lot
of times coming back because
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:you're familiar with them.
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:So monitor your returning
transactions in your cold traffic.
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:When you spike that spend up, you get
more new and returning traffic rather
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:than focusing on your brand campaign.
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:That's the nugget.
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:That's a pretty tasty nugget.
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:you caveated this with, if you
have a lot of skews, does it work?
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:when you categorize that a
lot of skews, I'm assuming.
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:Thousands of SKUs.
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:Is there any sort of
exceptions to the rule here?
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:Yeah, I have a dozen SKUs,
Like I just bought this
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:mouthpiece thing for my workout.
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:They have like 12 SKUs, but
then, the campaign, I think, in
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:the pet space that we're talking
about has like thousands of SKUs.
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:So is there any happy
meeting between the two?
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:What would your recommendations there?
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:It's category based in a niche.
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:So if you have four or five categories.
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:Of products in a niche
like workout equipment.
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:If you have, let's say.
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:The apparel, the gloves,
a chalk, whatever it is.
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:When a person is looking to buy stuff,
it usually doesn't happen all at once.
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:Not usually.
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:So if you're looking to be
like, Hey, I'm going to the gym.
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:I need to get headphones.
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:You have that.
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:I need to get a sweatband.
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:You have that.
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:I need gym shorts.
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:You have that.
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:Now I need gloves.
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:You have that.
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:They're still going to search for
things, but you can bucket your
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:existing audiences and prioritize
bidding for them on cold traffic terms.
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:So as to not lose them.
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:To another company that may have
even more skews than you do.
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:That would retain that
customer for longer.
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:So bigger skew brands actually
are more of a threat to you.
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:If you do not focus on retaining
and bringing back your existing
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:customers when they want to purchase
something very rarely, do you bucket
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:audiences of people like in display
and spend a hundred grand on them.
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:People don't wake up one day and be
like, dear God, I need to buy gloves
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:because they increased their ad spend.
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:That doesn't happen.
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:If only we can, we're a genie in Aladdin.
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:We can't control free will.
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:that's what I think is responding to
how they're going to be buying stuff,
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:taking a look at they're not going to
be loyal to you, especially after their
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:first purchase, maybe even after their
fifth purchase, they're not loyal to you.
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:They're loyal to what they want,
which is why Amazon does so well.
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:So that's, what's
interesting is looking at.
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:I need to work on retention.
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:Don't look at your
retention only strategies.
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:majority of the time.
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:if you have more than four or five
categories in a niche, your existing
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:customers are going to have cold traffic
terms that will be buying from you
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:again, because they find you again,
they're familiar, they're comfortable.
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:key is the categories really, because
we always think, Oh, you don't want
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:to spend more money on returning
customers, but if they're buying
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:the same thing over and over again.
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:it's a supplement, for example, like you
should be able to pull them in with a
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:minimal campaign, just on brand terms,
but also relying on your email because
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:you're just getting more of the same thing
that you bought before you're talking
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:about in the case of the workout example
is mouth guards are now a big thing, like
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:sweat bands, chalk, weight belt, whatever
it happens to be, the more categories
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:they're related when they actually
search for those and they'll say, oh,
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:I've bought that from that guy before.
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:I had a good experience.
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:They delivered it on time.
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:the mouth guard, the chalk
works, whatever it happens to be.
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:Now I'll get a weight belt from them.
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:And your email campaigns
reinforced that decision too.
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:which makes you more considered.
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:Here's a good example.
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:I have a company called travel.
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:We sell luggage.
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:I had a person on October 18th by
a thousand dollar piece of luggage.
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:And then November 8th, they
bought the cover for that luggage.
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:Yeah.
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:it was a Bellagio by Bricks.
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:They bought a Bellagio,
8, 000 piece of luggage.
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:20 days later, they
type in, Bellagio cover.
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:They, I saw my, in the
back end of Shopify.
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:They clicked on another UTM campaign
and then bought the cover for it.
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:They were going to buy
it from somewhere else.
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:But they bought it from me again
and I spent 2 to get, bring that
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:person back for another 50 sale.
