Mastering Retention: The Top 3 Levers You Need to Pull Now for a Loyal Customer Base

Hi, Retention Enthusiasts!

If you've been around the DTC block as of late, you know that customer retention is a hot topic.

But too often, marketers think retention is all about bombarding customers with endless emails and texts.

This flawed approach is usually peddled by email/sms marketing agencies or your local email service provider (ESP).

It's time we dive deeper into what really makes customers come back for more.

Today we'll explore the three retention levers you can pull to keep your customers loyal and returning for seconds, thirds, and beyond.

• Retention Retrospective: A Look Back at Early DTC Strategies

• The Educational Edge: Empower Customers, Boost Retention

• Basket Building Brilliance: Assortment, AOV, and Retention Success

• Data-Driven Decisions: Personalizing the Customer Journey for Retention

One quick update before we jump in:

I had the honor of joining the legendary Jess and Zoe on the Oopsie podcast to talk about some oopsies I’ve made. It was a really fun convo.

Check it out here!

Before we dive in, a huge shout to Gorgias, our sponsor for this week’s newsie.

Gorgias is my CX helpdesk of choice and what I’ve used at both OLIPOP and JRB.

If you have been here for a bit, you know how much I love Gorgias and why I think it’s an absolute must-have for any Shopify business. More on my fav Gorgias use cases here.

I’ve seen brands at all revenue stages use and love Gorgias, and I highly recommend you check it out.

It’s our one-stop-shop for all things customer. If you have any questions about how we use Gorgias or why we chose Gorgias, feel free to email me anytime.

Check out Gorgias here. Tell them I sent ya!

Retention Retrospective: A Look Back at Early DTC Strategies

In the early days of DTC, retention strategies were limited and less sophisticated than they are today.

Let's start off by exploring some of the tactics that pioneering DTC brands employed to keep their customers engaged and coming back for more.

Dollar Shave Club:Creating Viral Content
One of the earliest DTC success stories, Dollar Shave Club, relied heavily on creating entertaining and shareable content to keep customers engaged.

Their now-famous 2012 launch video, featuring founder Michael Dubin, quickly went viral and played a significant role in their early success.

The brand's humorous and relatable content fostered a sense of community and brand loyalty that kept customers returning and sharing the experience with others. Their affordable price didn’t hurt either. 😏

Warby Parker: Exceptional Customer Service
Warby Parker, the online eyewear retailer, focused on delivering an exceptional CX as a critical part of their retention strategy.

From their innovative home try-on program to their responsive customer service, Warby Parker made it easy for customers to choose them over traditional eyewear retailers.

By consistently going above and beyond for their customers, they created a loyal following who continued to shop with them and spread the word to friends and family.

Glossier: Building a Community
Glossier turned its customers into its most significant marketing asset by building a tight-knit community of engaged and loyal fans.

They tapped into the power of user-generated content and social media to create a sense of belonging among their customers.

By involving their community in product development and celebrating their customers' stories, Glossier fostered a level of brand loyalty that has helped them retain customers and grow rapidly.

Casper: Leveraging Content Marketing
The OG DTC mattress company Casper embraced content marketing as an essential part of its retention strategy.

They launched a content hub called Van Winkle’s, which focused on sleep science, culture, and lifestyle. By providing valuable content that resonated with their customers' interests,

Casper was able to keep their brand top of mind and maintain a strong relationship with their audience.

These examples demonstrate the early approaches to retention in the DTC space. While these strategies were effective in their time, today's brands have the advantage of more advanced tools and data-driven tactics to create highly personalized and impactful retention strategies.

Now that we've explored the early days of DTC retention, let's dive into the top three retention levers you can pull to create lasting relationships with your customers and drive long-term growth for your brand.

The Educational Edge: Empower Customers, Boost Retention

The first thing we need to preach is the power of education. As we've discussed in this previous newsie, when customers understand how to use your product effectively, they're more likely to enjoy it and repurchase.

Education should be your #1 priority across the entire customer journey.

I'm not just talking about throwing in a few tidbits of information here and there. We need to go all-in on product education:

Make your ads informative and engaging: Craft ad copy that grabs attention and educates potential customers about the problem your product solves and how it works.

Showcasing the benefits of your product and providing context can make all the difference in turning curious onlookers into loyal customers.

Ensure your product pages are crystal clear on the benefits and usage: Your product pages should answer FAQs, help sell your product, and educate customers on its proper use.

Take inspiration from brands like Caraway and Hexclad, which provide relevant information on their product pages tailored to their ideal shopper's needs and preferences.

Craft post-purchase emails that help customers get the most out of their purchase: Your email campaigns should focus on providing valuable content to your customers, not just upselling. Share tips, tricks, and best practices to help them enjoy their purchase to the fullest.

This will enhance their experience with your product and make them more likely to repurchase in the future.

Create comprehensive FAQ pages that address common questions and concerns: 

Customers should have access to a well-designed FAQ page that answers their most pressing questions and addresses any concerns they might have about your product.

A thorough FAQ page can save your customer support team time and effort while also boosting customer satisfaction.

Remember, the more knowledgeable your customers are about your product, the more value they'll see in it, and the more likely they'll become repeat customers.

Basket Building Brilliance: Assortment, AOV, and Retention Success

Now let's talk about AOV (average order value) and why it's essential to focus on assortment, not just volume.

For brands with multiple SKUs and categories, encouraging customers to buy multiple products and explore different categories is key to satisfying their needs and preferences–on their first order.

Think about it this way: if a customer purchases just one product, there's a 50/50 chance they'll like it.

But if they buy multiple products or shop across different categories, you increase the odds of finding something they love.

Here are some strategies to consider when boosting AOV with assortment:

1. Bundle deals: Offer attractive bundle deals that encourage customers to purchase multiple products at a discounted price.

   
   This increases the likelihood of customers trying new items and provides a sense of value that can lead to future purchases.
   

2. Cross-selling and upselling: Make relevant product recommendations based on customers' browsing and purchase history. You can do this in-cart, post-purchase, etc.
   
   This increases the chances of additional sales AND helps customers discover new products they might not have known about otherwise.
   

3. Category-specific promotions: Encourage exploration across categories by running promotions or discounts that apply to a specific category.
   
   This can nudge customers to explore other offerings and potentially find new favorites.

Data: Your Secret Weapon for Personalized Shopping Experiences

Last but definitely not least, let's talk about the magic of data. By combining basket analysis (we use Peel) with zero-party data (we use Octane), you can predict your customers' preferences and anticipate their needs.

This allows you to provide personalized recommendations that feel like a shopping concierge service rather than just another "out of left field" upsell.

Imagine your customers feeling like you truly get their needs and desires and are not just milking them dry?

Powerful stuff, I know. 🤣

It not only increases the likelihood of repeat purchases but also makes them more likely to spread the word about your brand.

P.S. Here are some ways to leverage data for personalized shopping experiences:

1. Customer segmentation: Divide your customers into different segments based on their preferences, purchase history, and demographic information.
   
   This enables you to tailor your marketing campaigns and offers to suit each segment, making your messages more relevant and personalized.

2. Predictive analytics: Use machine learning algorithms and historical data to predict which products or offers will most likely resonate with individual customers.
   
   By anticipating their needs, you can provide a shopping experience that feels tailored to them.

3. Personalized email campaigns: Use your gathered data to craft personalized email campaigns that address your customers' unique preferences and needs.
   
   This can include product recommendations, tailored offers, and relevant content that makes them feel seen and understood.

Remember, retention is about more than just spamming emails and texts. It's about understanding your customers, meeting their needs, and providing them with the best possible experience with your brand.

Before I go, one last thing:

If you loved this, you’d definitely love my conversation with Val Geisler about this exact topic—improving customer retention.

Oh, and chances are, you’ll probably also love the “No Best Practices” newsletter by Alex G.

That’s it for this week!

Any topics you'd like to see me cover in the future?

Just shoot me a DM or an email!

See you next week,

Eli 💛