Subscription Retention and Onboarding with Melanie Balke

Retention Magic Moment

0:00You can waste your discounts, actually acquire the wrong type of customer, brand lifestyle affinity and not just like specs. >> Their month five retention when customers report feeling benefits in week one. >> That's why it's so important for you to get people to the magic moment as quickly as possible. It really directly >> Treat your post-purchase experience, your paid users on the way to you as getting excited about the product, getting them excited about the brand, and really starting to onboard them step-by-step into the use of this product.

Speaker Background

0:44I was the first marketing hire for Carbon 38, which was one of the first e-commerce brands to sell made-to-order sofas online. They were then acquired by one of the top tech furniture companies in the US and then back at Jeremiah, I did some very traditional marketing consulting for brands you may know, love, or drive. we generate over 100 million in 2025 for our clients. This is such a BS stat because I went to go update it yesterday and I couldn't search my files. I am not doing this, but it's over 100 million, so that should be a good indicator. And I do love speaking at conferences. I enjoy them most. Let's go to the track B version at the Fireside Chat Blue Ribbon. I hope to be really impactful for you guys today.

Talk Roadmap

1:23So, I want to start with the problem statement. something you may have felt both as a brand and as a customer. Then we'll go into what my hot take is as the generation says now, what it's And why with that churn's not necessarily a rejection of your product, sometimes it can just be amnesia. And then the journey, like what are the eight stages to actually take someone from the moment of opt-in to being one of your most valuable customers. And that's because my template has four sections, we're ending with the sound of reminders cuz I was too lazy to put this one in.

1:57No kicking or dirty questions, or you can ask questions along the way. I will So, this is a very classic scenario.

Why Customers Cancel

2:03your customer is about to cancel, right? This is a classic subscription model, right? A four and open bottles at all. All right. She's standing there. She's like, "What do I do with all this stuff?" She's about to cancel. Meanwhile, by the way, you're the brand that you're afraid to eat on her because you're like, "I hope she doesn't remember she has the subscription." Which is not great. And she just really never got to the point where she's actually using your product to the point that the subscription makes sense.

2:33I, on the other hand, have been such a good girl. I've been on my omega-3 subscription and I take it every day. So, what is the core difference? Like, why is your customer Why does she fall off? And why am I a core user of omega-3?

Omega 3 Touchpoints

2:49The difference is really, and I'm going to give you the punchline to the whole story right away, that I've been trying to take omega-3 regularly for 10 years. That's the first time I started. Over the course of 10 years, I have been told what the value proposition of omega-3 is so many different times through so many different pain points. So, it started for fitness and then it went when I had back pain and then, you know, now again we're back to weight loss and then we're to brain function.

3:17So, over 10 years, the value prop of omega-3 has been hammered into my brain. And if you know the quote, it takes about eight touch points for a customer actually convert. It's very similar on retention. Just because someone bought from you once, doesn't mean you've done the work to actually retain them. So, these stages that I'm going to talk about, they're very similar to how you would take, you know, eight times, eight touch points to acquire a customer. I think takes actually playing more to build a really, really valuable customer. We're going to walk it through the eight stages from up to to what we would hope would be our most valuable customer.

3:58To create someone like me who uses Away Three. And hopefully it won't take you 10 years and 10 different pain points that they come across over time. Hopefully you could do it by actually engineering the the predominantly the post-purchase experience they get.

Stage One Acquisition

4:14So, one really important thing before we start, stage one is actually has little to do with your attention agency. It has everything to do with your acquisition key. So, your most valuable customer actually starts when they see your first ad. If you acquire a customer solely based on a really massive sexy discount, their loyalty will always be to the discount and not to your brand or the value proposition. We see this via FCM is very common.

4:44They're usually why your most or your weakest LTV cohort if you look at the FCM compared to the rest of the

Discount Trap Story

4:51year. I had a really fun personal anecdote. So, during COVID I was bored as many of us were, and I saw this really great offer for Winc, which is like this wine subscription box. And it was 50% off. And I was like, "Oh my god. I'm at home. I love wine. I should get this. This is a great deal." And so, I ordered this wine subscription box. When I clicked order, I distinctly remember going, "I'm just going to cancel it right away."

5:20And so, I was acquired by Winc not because I'm a regular wine drinker who actually needs a wine subscription box. I was acquired by Winc because they had a great discount. I actually did not try any of the first box, but I'll tell you a little later why. I the CMO former CMO of Winc is a good friend of mine. He actually told me that this was a total failure of a campaign that they ran.

5:43why? Because they acquired people who were like, "Oh yeah, I could get six bottles of wine at a 50% discount. They didn't actually acquire who their core customer should be, which is someone drinks six bottles of wine a month. I made it to three two, maybe three cuz it was COVID. So, you can waste your discount actually acquire the wrong type customer to your company. So, that's number one. it is really important when you do write your ads as well to talk about your real value prop. So,

Ads Attract Wrong Users

6:15I have another example. We work with a sexual wellness brand. As you see this lady with the fireworks down there. this is my representation of their brand. They would run ads that were about like the fireworks during sex. And so, I want to say I'm right. The fireworks during relax. And what they found is they had a really These ads have performed really well for like, who doesn't want to experience fireworks? But when they actually looked at retention, and why are they the biggest problem was like, we're selling these fireworks, but our products are actually doing more for like pain management. And these people never come back because they don't have a problem that solving, pain management.

6:59And they don't experience fireworks because that's not actually what our product does. So, it is really important at the ad level when you are billing at least for lifetime value, that you are communicating the value props of your product to the right people with the right with the right messaging. the last thing I want to say on the acquisition or two last things. One, you

Product Cohorts Predict LTV

7:23can accurately predict the behavior of your customer based on the product they bought. So, if you go and actually do a cohort analysis based on products they bought and LTV, you will see a core difference. So, for another great example is I just talked about sexual wellness product. They had melts product, which really about relief. So, that the whole messaging there really is just about pain. That's one of their highest LTV creating products. Why? Again, because it's a real true fit between what the product actually does and the customer.

7:54Quora, I don't even know how to actually pronounce this acronym Quora. This is not data from us. I heard this a really long time ago on a podcast. I don't remember which one it was or who to shout out, but it was a fantastic podcast. If you Google it, you might find it even. they were talking about how they launched the swim diapers and it was really interesting because it was that first order conversion really great performing product, but it was a terrible retention product because Quora's full point is like I think it's about like the the health of baby and also like diapers overnight and everything like that. And the swim product just didn't show baby's that value proposition up a grand. So, it was a terrible product actually at at retention, but it was a great first order converting product.

8:43So, just mentioning this because when you go back to your leadership team and they come and they talk to you the retention people about LTV LTV LTV and you have this completely separated from what acquisition actually does, that's a really great point to actually start looking at everything holistically.

Cashback Popup Test

9:00the last thing I'll say is one fun thing to test to take home tactical that you need today was to you guys will run a discount on your pop-up. If you want to run a text on something that can actually increase your LTV and a repeat purchase rate, run a cashback offer. Just please don't say the word cashback. Cashback reminds me of my grandmother for some reason. you know, have a sexy marketer or have a marketer write it sexy, not a sexy or have a sexy marketer write it like sexily. However, you want.

9:31But what's really cool about this is actually the the cashback will work only works if they purchase twice, right? And with cash back you can give a bigger discount. So, if your discount 10% straight up on the first purchase, cash back could be 25% on your second purchase. Why can you give a bigger discount? Mostly watching our common or being in the cashback. And two, you're actually you're you're two class purchase customer. That's where your profit lives, right? This is how customer don't actually have to require it to apps. So, usually I would say you could probably save you some money quite significantly good business. We've seen like up to 40% more power up conversions. I would see more repeat orders and we did the math there was less cost. I'm not saying this is going to work for everyone. I think everyone should test these things because our customers like a good friend. But this is a really great way to actually start engineering LTV at acquisition.

10:28So, stage one is acquisition, stage two

Stage Two Post Purchase

10:30now when it assume you guys have done a really good job at your welcome slot and part one you've got your people to first purchase. And then most brands now just go, "Cool, that was it." When my belief is this is where is attention at longer, your real work actually starts. Most people treat the first and purchase as the marriage. When in reality the first purchase is really just date. This is like the first chance they're giving you to wow them.

10:56And people also just forget that someone just get a straight up on the internet like if you put it that way you kind of realize there's a lot of anxiety and uncertainty in doing this. And when they do first merchant your customer experience their anxiety and uncertainty they'll have something. So, they just gave a straight up to you and they're like, "There's some people buyers remorse and I'm not mad. I really shouldn't have spent that money." And then what do you do is you send like tracking that day and they're like, "See where my package is at? I'll come home with it."

11:24a really easy fix and it's you'd be surprised. I've seen hundred million dollar brands that do not have stuff like this. they're usually $100 million brands because they're by children. I have seen $100 million brands that like don't have these really core basic post first purchase flows.

Onboarding Before Delivery

11:42Use your transactional flows. Or or even if you don't want to use your transactional flows, you probably some of your most open flows. Move those into Clavio or whatever ESP you're on on a set. And use them as onboarding to your product, right? You want to get people excited about your product before it gets to them. You want to get them primed and ready for it before it gets to them. And I will say like humans, we need to hear things a lot of times, right?

12:11There's probably some quotes your parents said that you remember really well because they said them a thousand times. We repetition to really start adopting adapting adopting adapting. Think it was It's end of adopting things. That's where I was See, I am German. So, make a big deal about it purchase before the box lands and treat your post purchase experience, your your cadence is on the way to you as getting them excited about the product, getting them excited about the brand, and really starting to onboard them step by step into the use of this product. So, I gave you like the most basic like day zero, your order's confirmed, here's This is like a supplement brand as an example. The Y behind the formula. It would bring back the value proposition. Hey, you made a good choice buying this product by the way. I know you're super freaked out right now, but just to remind you it was really a good choice.

13:04They want you to already take it. Here's a how you can pair it. Day two, hey by the way, week one, these are the things you should feel. Let me talk about that a little bit again. Day three, bringing in the brand. By the way, this is bigger than you did just buy a supplement, you bought a whole brand, right? People don't buy that at Igonia because they need a square. People buy at Igonia because they buy the brand.

Magic Moment After Arrival

13:26and then they fall once the box gets there, your number one job is hopefully you've already gotten your customer invested. Hopefully you've gotten them excited. Now it's to get them to actually use the product as quickly as possible. So there's a magical thing. I actually can This comes out of the SaaS world. Which one? but it's called the magic moment, right? The magic moment is the moment someone uses your product and it goes, "I thought I loved this. This is amazing."

13:54You probably have had experiences in your life around magic moments with certain products. Your job, once the product arrives, is to get your customer to the magic moment as quickly as possible. And this can be sometimes more difficult and sometimes less difficult. The worst part about this is not only do people not get to the magic moment on their own usually, but sometimes it can feel really underwhelming. You bought a sexual wellness product and you were experiencing fireworks and you used it and you're like, "I thought it was kind of good, but it kind of just felt like lube with a little bit more."

14:33We're going to have some work to do to get you to experience magic moment. So, I This is like some of our portfolio of examples of sexual wellness product brands like the fireworks versus the kind of just felt like lube. It's now our job to get them to understand that that's wrong. That the magic moment comes with repeated use. That the magic moment actually is certain things they should be looking out for. And I'm going to talk about that I think in the next slide. I'm going to steal the next slide and then I'm going to go back.

Red Car Effect Education

15:02So what does that mean? We call the red car effect. You ever heard of red car effect? You buy a red car, all you see is red cars. What you want to do with these clothes is actually be really clear on what people should be experiencing in week one, in week two, in week three, in week four. When you tell them what they should be feeling, they will start feeling it and then they will credit you as in the branded, as in the product around feeling this. So, you want to remind them though of what they should be or you want to tell them what they should be experiencing, and you want to remind them of the value prop. Why do I say again you want to remind them of the value prop? Well, so this is a little bit more difficult for brands like Ruggable, break down and rock spray here like I don't have a rug and now I had a rug.

15:44But there are other brands like cosmetics, right? Like, why did I buy this in the first Why did I spend money on retinol in the first place? Like, why do I have to use this area? Oh yeah, look at these poor nails for that totally forgot. Wool clothing. Why did I Why did I invest in a better for you wool clothing product? Why should I be wearing this on the wear compared to the yellow ones? Oh yeah, the yellow ones are toxic, I forgot. Especially if you are a higher price point product where someone like Mrs. Meyer was up a Homelet's brand, and their hand wash is like I buy it on sale at Target for fake Percy, basically. But is it really better for you? It's like so clean. They built it cuz they tired of the kids out of toxic products. And I was running out of it and I was like, man, I'm going to have to buy this again. This is like $25 for hand soap.

16:33And I saw this thing and I was like, oh yeah, this is exactly what their customers experience. Like, we get them on board because we do such a good job on the welcome flow with value prop with like this bad for you. We are so much better for you. Blah blah blah blah blah. And then they buy from us and then we go, well, now you know, so just remember but especially when things are priced high comparatively to their counter products, it is so important that you remind people why they bought this in the first place, why they should come keep coming back.

17:04And just go back course purchase flow, heavy education. Thank you guys for doing that. Talk about the required fact. Your goal is to get them to success on the magic moments as quickly as possible. We'll talk about that.

Address Early Side Effects

17:17Oh, and talk about the bumps on the way. So, any minor bumps can be added to the flow. we have a supplement brand that we work with and I mean set campaign that was kind of like, "What to do if you actually feel worse in the first month of using the supplement?" That was like one of the best performing campaigns we ever sent. I'm like, "Oh, this should be in the flow." Like, yeah, this is like a customer insight and that they didn't really know with this this is a huge problem brands should be in the flow.

17:43And so, we built it into the flow like heads up to the common known side effect. If you feel worse at first, don't worry. It's like whatever your body detoxing your liver, maybe. which is really great because honestly that step actually does was a few snakes. One, it makes people feel like they're on track and not like something's wrong. And two, it actually helps you on the on the support side, right? And on the reason side. You have communicated that this can be an experience, people will think it's wrong and they'll request a refund or they'll dismiss or take it or not.

18:15but if you prime people for, "Hey, this is you're actually on the right track. Don't worry about it." That can really help. So, we noticed the first to second purchase rate on just like at this one email increased by 24%. So, like people went through it. So, that's pretty cool. And the last one on this is I talked about the the magic moment, right? Your goal is to get them to the magic moment as quickly as possible.

18:38Your next and one of the other things by the way the magic moment this is real proof that they arrived at. Their month five retention when customers reported feeling benefits in week one increased from 30 to 60%. That's how important for you to get people to the magic moment as quickly as possible. It really directly impacts their LTV and retention.

Habit Building Support

19:04The last thing I want to say is, you know, first use is also the moment you want to start thinking about building a habit. Habits are really difficult to build, by the way. Like, if you've ever started taking supplements or diet and waited three to 10 years and then you stopped and started again, you know what I'm talking about. If you ever tried to go to the gym every day or if you got a cool new cosmetic piece that retinol or like, "I'm going to use this every night." And then you maybe forget.

19:30These are all not based on personal experiences at all. You know, building habits is really difficult. So, you want to support your customers building habits. Again, this is easier if you're pretty boy. It's a little bit more difficult if you're rugged boy. There's really only so many rugs you can have in your house. but the habit building loop is something you really want to think about as a retention marketer. So, you could ship a physical 90-day habit tracker if you want it to be really off the nose about it. We thought about this with sexual health brand and we're like, "Do we like send them a 90-day sex challenge calendar?"

20:06You know, I don't know if that's aggressive. Cuz there are people who are like, "Show me what their sex life is." We all want to be like, you know, you started running. Now we're on a tile floor. so, we're like, "What can we do? What can we do, man? You don't want to What do we do?" So, we went back to our campaigns and we're like, "Hey, I actually noticed like these campaigns you send that are like how-to how to do amazing butt massage. Like, that's really long. How to give an amazing butt massage. they performed really well. I was like, "Why don't we move it more into how-tos that use the product?" Like, how to do amazing butt massage with the product.

20:42And so, that's something that we built into the into the flow to help the habit building. Cuz what we want to do is you want to remind them to use the product constantly. We don't want this to become a product you're putting in your nightstand and you forget about it for the next 90 days, right? We want to incentivize you to use it regularly and build that habit. Okay, so first use, we did it. We got

Second Purchase Crucial

21:04them to the magic moments. They're super excited our product. now, I would say arguably for retention, Lumber is in the most awkward time in their life cycle. Which is your second purchase. this is the hardest dollar you'll ever earn. It's also probably one of the most profitable dollars you'll ever earn. And what we see in accounts together again is a whole lot of nothing, first of all, like a whole lot of nothing after those purchases.

21:31Then a whole lot of like kind of like cross-selling stuff and come back isn't an attempt to re-fuel stuff. and that's in this time. But like I said, people forget that you have to repeat yourself to QVC and you have to break that value proposition. This is one of the biggest churn moments between purchase one and purchase two, and my hot take is it has nothing to do with your product. It has to do with the fact that you thought the first date was marriage, when it was really Sorry, the first purchase was marriage when it was really the first date. this is my, by the way, Chase and I do like they YouTube thing together like probably 4 years ago, where this was my whole letter for the entire time, so.

22:14So this the second purchase is really like, you know, the first purchase was they gave you kind of try. Now the second purchase is you want to remind them why you're so amazing and why they should give you a try again.

Winc Surprise Hook

22:26Coming back to the link story. They got me so good. I got my first WIC box. I was very excited to go cancel and Village and I did give you sent this cancel all the way. But in my first WIC box, they had a little beef linen there. And it said something like wide foreshadowing. The weird feeling that there might be a surprise in your next box. Oh, they got me so good. So I kept I kept the subscription for my second box.

22:57And there was no surprise in my second box, believe it or not. So I got bamboozled. That was a surprise. There is no surprise. But, I was talking to the CML wake about this and he was like, "Yeah, this still didn't work." And so, part of the reason it didn't work was this is a great incentive to keep people hooked, but if you're hooking the wrong people at stage one, you can't really build a high LTV for rap.

23:25But, I thought it was a really good technique. It's something we were assuming at, right? how can you build

Strategic Gifting Milestones

23:29milestones and incentivize people to go for milestones like twice a month or also on two? The other thing about gifts, like gifting has to be done really strategically, right? One, you have to look at your margins. They like 10 to 20% gross margin or gross margin is like the the ethical rule. And your gift should make the experience better, right? Your gift should actually be a secret trap to get them more hooked into the app.

23:54If you are a collagen brand, then your gift could be a frother. If you are a supplement brand, your gift could be a really good product that actually goes with the first product, makes the experience better, and you know, creates a better experience, and it's also technically secretly a cross-sell at sneak peek, so to say. So, I think it's really important that you think about gifts, that you think about it strategically in in terms of how are they going to make the whole experience better.

24:26Again, I'm so sorry for rug burn because man, you really have a hard place down there. I keep I like that you said there's a rug burn a lot. >> [snorts] >> How do I help this lady? I don't know. You know remodeling? You could incentivize people to remodel their homes. I like that. That'd be cool. so, yeah. Your second purchase is probably one of the most important

Subscription Portal UX

24:51things. Now, let's talk about what happens if you actually get people onto your subscription program. Awesome. You did Very important. Now, what we see brands do is they have some on subscription and no one just done. I want them on subscription. Just make sure they get it. I think that's actually the complete wrong approach to subscriptions. I firmly believe you should make getting on subscriptions extremely easy, but you should make skipping subscriptions even easier. People forget that part of an experience and subscription is subscription for. I hated subscription portals. Something you should be working on a lot to make it as convenient as easy and as enjoyable as people being there.

25:35There's so many cool tools with which you can make your subscription better. Like One Text. One Text is a really cool tool. Tool. They'll text you and it'll be something like, "Hey, your subscription's coming up. Do you want to skip it?" And they could just skip it. Or do I add something to it? And then you can actually just add something to your order and One Text will go and alter your Shopify order or all that.

25:55It's a really great way to actually not just encourage people to stay subscribed, but also increase their average order value along the next purchase. I'll give

Easy Skips Reduce Churn

26:04you my personal thing. My personal anecdote is I'm subscribed to Just Ingredients, which is a great brand for my protein powder. And I kind of fell off my protein powder for a while. So now three up open packages of Just Ingredients at home. I was about to cancel my subscription, but they make it so easy to just skip it. I actually like, "What? I'm still going to eventually get through this. I'm just going to stay." That is a much, much more valuable experience for you, much, much more valuable customer for you than someone who decides to cancel.

26:34As long as they're in your subscription program, even if they're skipping three to four months, they're still in your subscription program. So how are you going to do that? We've tested some of this like 24% less cancellations over like running like a a program to skip. any you have things like we use platforms like Zemo to also like it interactive so you can actually go in and to your order when you remind you, "Hey, on your next order is going to have one skip or if you want add this electrolyte drink next to your protein powder work." I have bought way too many way too many products I don't need some Jesse just by doing that because they're really good at dynamically pitching me the right product for my next upcoming order. And the email I could just go click add it and it was just add. So, when it comes to subscription, I think the question is more like, "How do you make this program actually really convenient and easy and enjoyable for

27:27your customers?" And less about like, "How do I not remind them that they're on this at this whole you know, they forget." And of course, everything we talk about in the second purchase habit building, reminding them of the value proposition, this all sold applies here. So, we talk about this. Don't don't burn your cancel flow. Have you guys question, have you guys ever gone through like SAS platform easier or something else we tried to cancel and it was extremely difficult?

27:55Do you like that brand? Was that positive experience for you? Do you think fondly of them? So, yeah. I hope that tells you everything it tells me that.

Cancel Flow Feedback Loops

28:06really important that when people cancel, what do you do? A lot of people don't really do anything. Actually, I don't even shout out to the standard cuz I think you guys must have done this because I was subscribed to AG1. Can't do it, taste taste terrible. Terrible. >> They have probiotics. >> This is I think before this. This was like way back. Can't do the taste. But then you cancel, they ask you why you canceling. And I think this might be the first update that actually ever emailed me based on the reason that I was canceling. I was like, "Oh, thank god I gave you all this personalized information it should send you nothing like that."

28:42And so, you know, this text email them, "Hey, this is how you can make taste better or you want to think you guys have pineapple or something. Citrus app. so that was that's a really good example. That too much product again, we want to sure that we don't if they cancel or do we want to sure we don't lose them completely this customer because they're not churning you they don't like us. They're churning because they have too much of us. So that means different cancel what about flow.

29:11I don't feel anything again. It's a cancel anything you probably messed up earlier. The right card down while building the habit. that's a really important lesson.

Customer Interviews Fix Churn

29:22And all the archers like no email out markets that product. One thing again like that that's a problem is everything living in silos is if you have a lot of people cancel the solution's not to go to your attention team and be like you build better flows. Right? That is one solution. But a really big important piece is like how do you customer energy to figure out why are people canceling? Right? Actually getting on the phone with the people who are using your product going tell me about the experience. The mom test is really really tough. That's your hair you see if you guys are really about but this is probably one of those overlooked things, right? Here it goes sexual assault we've been working with with so long. We used to try all these different flows all these new flows on.

30:04Please can you slide? At this point it will rub the customer areas for you. And when we did it we're like oh, we're like acquiring all these like young and hip kids and they think this is like you know, they'll be like it's really cool fireworks sexy experience. But our high LTD customers they're like, you know, older ladies you have pain or some problem or your body's changed. So that's a huge mismatch in this post purchase flow because we're talking to the wrong people about the wrong things regardless of what actually flying in the back room in the first place. So the the highest impact thing our leadership team can do for churn is actually go and talk to customers and see how why they're churning and often people just don't do that. And I think that's something we do because we're marketers at heart, so we cut out marketers.

Personalized Win-Backs

30:56Okay, oh my guy, I already talked about this, but I do have a little bit more on the winback, so your winback flow, you've lost these people, their winback flow and lightning is one of the least least flows you should really personalize based on how much someone spent with you. Because someone who's bought from you once should be receiving a different winback flow than someone who's been buying from you for years. And partly because if someone who's buying from you for years, you can spend a lot of money to win them back because you know they're much higher value customers.

31:27So, I would recommend that.

Milestone Loyalty Programs

31:30for regular customers again, I think the value proposition is so so important. And that if once again, your VIP customers, the editor of the visual customer you have, that kind of content can help with all your prior flow all the way up to your ad copy. Okay, my last stage for you guys, and this is really something we learned from from one of our clients, Beatbox. I go to so many brands' accounts and I look at the loyalty program and it's like earn so many points and get this.

32:07Spend this and get this many points. And I can tell you that I believe transactional loyalty is dead. I believe the whole like earn points, hit this, blah blah blah, it's like does not work. First of all, there's thousands of loyalty programs. Second of all, no one wants to do math to understand what they should be getting. No one's like tracking how many points they have, which like just ain't real and so on and so forth.

32:29I think loyalty programs should really be thought of as milestone programs. I think most important is rewards are simple. So, instead of I, you know, spend $50, get 30 points, and you have no idea what those points mean or what you can redeem for. It's a gift in your server. Right? Versus like you have 847 points that you can spend. Also, loyalty should really be about brand. This is what we want for BeatBox, brand lifestyle identity, and not just like spend.

33:01This is the opportunity for your most loyal customers to be fans and to co-create the brand. So, BeatBox has an ambassador community, which is really cool. They basically incentivize people to take like complete tasks, like go snap photos from us at the festival, or like, you know, like they complete like different types of challenges, like snapping photos is one of them. And trying different flavors, buying at different stores. And so, for rewards, they get free product, they get festival tickets, because that's a crowd for BeatBox. So, like, you know, it's their tier.

33:35Not a festival tickets that brand built self-fresh. Go give them festival tickets, give them something that's relevant. Well, it's just merch. That's pretty cool. They have about 900 highly engaged. So, highly engaged means like these people have completed three Saturday challenges together. ambassadors who've done that. They got about 5,000 active members. And all that from around a 300k social following. So, they got about 2% of people to be engaged and actually spread the brand, and it was really heavily loyal. They helped co-design all of the new flavors. They're great flavor. And so, I think that's really when you think about loyalty, it's not just like, "Hey, you know, spend 50 bucks, get 50 points." I think it's really about how you take the the core VIP customer of your brand and help them co-create the whole brand. Help them be a part of the lifestyle.

34:23Patagonia is a really good example. Patagonia is a ton of activism stuff, which I think is a big piece, and like child events and stuff like that, which I think is a big piece of what has created a pretty loyal customer base to them over time as well. And Vitality gets insurance premiums when customers lose their Apple Watch rings. That was something I I worked out a while back. So, yeah, I think that's that's also a great side of things to do.

34:52The set of reminders. Okay, we're at the

Talk Wrap-Up Key Takeaways

34:54end of my talk. So, acquisition LTV starts at acquisition. If you have a bad acquisition offer, you're going to end up having a bad LTV customer. Opt-in. Test something like cash backs over discounts. That can win. I think opt-in, by the way, as a small side note, is one of the mechanisms you should be testing constantly on your website. It's one of the easiest to run tasks with some of the biggest impacts you can have to your entire program. If your program really is always good as another key your first purchase.

35:29They paid a stranger with their own money. They can feel good about it. Odd word with the product. So, first use is your responsibility to get them to the magic moment to get them to experience the best version of your brand and why they should be a customer for a long time. Script what they should feel. Public profile added. Your second purchase and I will you surprise surprise and delight, which is a classic marketing tactic, will beat a 10 20% off discount anytime.

35:59For subscriptions, I think it should be one click, everything is easy as possible. Customers to go through this this funnel. And again, don't forget you have to keep reselling people on why they should be buying from you. Like, as an example, you don't get married and you stop going on dates, right? Usually, when people get married and stop going on dates, it ends up being problems. You get married and you keep going on dates. Just you have to keep selling the person on why they should be with you.

36:28I mean, I I think that's actually smart. It's the same thing for Adidas. You have to keep selling people on why they should be with you, or why they should be buying from you. and then on cancel and win that, I do think this is one of the big opportunities to actually get into the nitty-gritty, talk to your customers, segment more strategically, and use this just as a feedback loop for your overall business. So, that was it.

36:54Thank >> [applause] >> Or is this dogs and thirds? Ease. Out of four steps you I think was people are free in post-purchase if you excite them free the shipping process. Say or you worry about fire flooring bought or as another key fire force. You really simple as really in what points. You know, you know, brother you get that opportunity to I don't otherwise they just love. I don't know how to get I don't know how to talk about social media.

Q&A Repetition and Content

37:29>> I think it depends a little bit on the product, so and also on the content you have, right? Like we work with a luxury brand for cars. I've wanted a car from me. For us it's really cool cuz we can reiterate that Arab insurance thousand different ways. We reiterate the manufacturing process in a thousand different ways. I'm never going to brand out his content to tell people some different angles. That brings back the value prop. Now, if your founder story is like, "Hey, in my woke up one day and I wanted to make chocolate that's better for you." And there's really not much more there.

38:03You know, I think it comes back to finding different angles to tell that. And finding different key points to talk about. But, I do think really it is so underestimated that repetition is actually extremely impactful. In marketing and life like that's how humans learn and adopt things. It's just repetition. >> The book on you mentioned a book about customer energy. What do you do? >> The Mom Test. So, it's called the Mom Test because the book is supposed to help you when you when you go to your mom and you're like, "Mom, I have a business idea." Your mom's like, "Yeah, of course I would buy this."

38:37Because your mom loves you. And Mom Test teaches you how to run customer interviews in a way that's not leading, so you're actually getting real customer feedback versus leading them down the path of your questions.

Q&A B2B Magic Moment

38:50>> So, this might be a little bit out of order to ask this, but I'm just curious how you think about it when you ask Beauty Sandal there. Awesome, I get surprised at that. Which you know, the you know, magic moment. I know it's an upper side -oh moment, right? In in the tech space, but I'm just curious like how about Joker Ladder? How you figure the difference is between such and the two? >> I think B2D has a lot to learn from from B2C and D2C, and I think it's actually converging much more over time. So, like as an agency, we think about how we get people to the mall or the yellow, "Oh, this was a fantastic investment."

39:28Like, I know right after they say, "Okay, we're going to work with you." I know that's when they're most anxious, because they're like, "I'll give you a negative decision if you had four other agencies fail. So nervous. I got to really push them. I really make sure I get value." So, we know right then is when we have to give them magic moments first. So, we want to get the quick ROI on the great experience at first. Wow them on the kickoff call like we know that's the most important piece. So, I think it applies a lot.

39:55>> Well, I think it's Do you also do acquisition? >> No. >> Okay.

Q&A Discount Buyer Transition

40:01So, and I think on the first point, it's a good question to say to me is I think we're experiencing the discount led erosion of like quality customer. And like Nick, you had sweet about this last week that I think about through the perspective on Sarah. On the acquisition side, on the retention side, we're seeing that we're being There's an element My main question is like what do you actually start getting transferred preparation ship and like what part of this pixel learning versus just the annual like learnings that you're seeing leading to go away for quality quality customer. I mean, you know that's driving the acquisition funnel, but it's really on the acquisition side. So, I guess like my question to you on the retention side is when you what have you seen to be able to acquire customers?

40:56How would you apply strategies you set to lower in the transition your period? Getting those low quality customers what seems to be low quality customers to buy in for a better reason than this new aggressive discount. And on the acquisition side, your tricks about multiple offers and like transitioning multiple offers. I think that's something you have to figure out is like this offer is working on the acquisition side. The retention metric showed that it's not creating high quality customer for us.

41:25We're all scared to death of massive growth better especially right now when it's so screwed up. So, like how do you start that transitionary period? Just strategies we >> That's our ready to >> I got it. Whatever you want. >> All right. I'll I'll tell you on the retention side. So, number one we found is just it's so much more important now than it used to be for the retention team to be really communicating with the acquisition team constantly.

41:54so, if you had a brand and you have two separate teams, it's really important that they actually communicate constantly and give each other feedback. I'll give you a specific example on this challenge and so if again the Central Ohio span is it's really top of mind for me because all this just happened recently. But so, they realized the required acquiring of raw customer and they have them over a really long beard time. What it actually came down to is that they didn't really understand our customer, right? They didn't really have a keen understanding of why are my VIP customers customer and my VIP customers.

42:23So, what we're doing now and I don't know if it's it's going to specifically work in this example because we're just working on it now, but we've changed our messaging from like the flowery, fun, young girl who wants fire words for men to like really like the older person who has specific pain points that they're trying to solve with the product. We're going to see how that how that, you know, works over time. So, I don't have a great answer yet to y'all. This is an example, but like every YouTube >> No, it it it does change a little bit.

42:54So, this is the context. We try to run three to six offers. At least something to testing maybe majority of the spend is going to one of the offers, but we're still going to We'll We'll We'll segment by and if they bought or if they have not bought, maybe exclude 30A. I'm doing like the most strict or understanding here. On subscription because majority of the programs that are training subscribers to subscribe, I made AG1s, Rise, Everyday Dose, it is promotion. It's not heavy and like heavy value offer.

43:31Free gifts plus discount. I think there's just like this natural way of how we're going to try to get them. I don't think it is someone who's like collecting discount buyer. I'm collecting it an AOV buyer. Because So, why I think is what why we're trying to get to that nuances a customer that's going to drop $125 with me on the first time is going to churn out faster than the person that's going to pay $45 $55. But, I need to have enough of the 80 to 125 buyer to get the room in CAC to spend.

44:00So, they come on an acquisition side, I think you need to reframe the I don't want to be acquiring a discount buyer to acquire. This person came in on eight A or B. First of this customer came in on a B. For you guys, I think it's actually getting more nuance because two step systems the core thing that they're buying. >> Yeah, but it's right now they're running offer at top that. >> Okay. So right now we're running offer it's it's Mike that real quick. He's like, we all see you to the air race and it's just play every what we're just going on now and it's like we're starting percent off. Now it's 40. Now it's 60% off and it's like there's smaller people that I had to go to work out with that not specifically. You're able to have everyone seeing these offers. So like you have to find a way to make it work. But to answer your question, the running offer is like buy one full price, buy two get one free,

44:49buy three get two free. Cool. >> Yeah. >> Like three offers at once. >> Five offers at once what it's like. >> No problem. No problem. The the for you specifically because I do not have the space it's so difficult. >> Put this up boots. >> You care about the product which is the HR and you care about the discount I think you need to offer is synonymous with entry point. Don't put offer synonymous with discount.

45:20Like you can't you just can't go there and like yes that's what it is technically but you can't you can't let that be it's it's split it probably coming. >> How many different type of entry points you have on the side? >> Even if even if it is that two step system and they get a free shipping.

Final Thoughts and Close

45:34>> Yeah, I think this is >> the only thing that matters right now in the acquisition game. and it's great for so for retention. We have like churning cohorts that go basically the the the cohort's always going to be into the drop out but the speed to which I can get that to whatever my operating which is four months for free is if I can get the closest to four months. Remember free gift sent it or quarterly push, That's all all care of.

46:04That's four months I know I've been spending. I'll spend more in the month. That's it. All right, so that's it for the Now, they give you them. >> [applause]