How to Solve Customer Retention Issues

John: 00:00:11

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: 2000

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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.