Loading...

E63: Alex McEachern

Retention Strategies That Keep Customers Coming Back for Life

Podcast Overview

Struggling with customers who make a purchase, return it and never come back? 

Well, you’re definitely not the only ones! This week we’ve got Alex on the podcast, and not only is he obsessed with creating winning retention strategies, but he also specialises in transforming customer returns processes into enjoyable experiences that keep customers coming back over and over again.

Lifetime customers who live by your brand are an incredibly valuable asset and in this episode, Alex talks to us all about how to create your retention strategy to develop the ultimate brand loyalty.

eCom@One Presents:

Alex McEachern

Alex is an eCommerce Marketing and Customer Retention expert based in Ontario, Canada. Alex has helped 100s of businesses implement their retention strategies and thrives off of developing solutions that turn one-time purchasers into customers that keep coming back for more and more and more. 

In this episode, Alex discusses what exactly customer retention is and how to implement strategies to achieve your retention goals. We talk about one of the biggest challenges that eCommerce stores face – returns – and how to flip that negative customer experience into a positive one that sees them becoming lifelong brand advocates.

Alex also discusses how you can improve your post and pre-purchase strategies to improve customer experience, formulas you can use to calculate your current Customer Lifetime Value, as well as brands to take inspiration from who are absolutely nailing their retention strategies.

It can be easy enough getting one-time purchases, but in the interest of really growing your business, the big win here is getting a strong customer base that lives and breathes your brand. So listen in as Alex tells us exactly how you can begin your journey to achieving this.

Topics Covered:

01:20 – How Alex found his passion for eCommerce and customer retention

02:34 – What is customer retention?

03:54 – How to turn returns into retention

10:46 – How to calculate your Customer Lifetime Value

13:13 – Biggest retention strategy mistakes

18:43 – Tips for improving retention

20:30 – The most successful strategies Alex has worked on

25:06 – How to split your focus between acquisition and retention

27:50 – Brands that are nailing their retention strategies

30:26 – Book recommendation 

 

Richard Hill:
Hi there, I'm Richard Hill, the host of eCom@One. Welcome to our 63rd episode. In that episode, I speak with Alex McEachern. Alex has helped hundreds of eCommerce stores implement retention strategies and specifically those sometimes pesky return strategies. Your customer's experience will be your differentiator, and Alex is a true expert in making the process enjoyable and more importantly, a revenue stream for the long-term. We talk about pre and post-purchase strategies for retention of customers, that all-important lifetime value of your customers and how to agree on a basic formula to work it out and increase it. Three simple strategies to avoid to improve retention and the split you should be thinking about if you're really looking to scale when it comes to investing in acquisition or retention. If you enjoy this episode, please make sure to subscribe so you're always the first to know when a new episode is released. Now, let's [inaudible 00:00:52] to this fantastic episode.

Richard Hill:
How you doing Alex?

Alex McEachern:
I'm doing all right Richard, how you doing?

Richard Hill:
I'm doing pretty well, I'm doing very well, in fact. I'm looking forward to getting all the juicy tips off you today. This is a topic that we've not really covered too much that we're going to delve into, and I know it's a topic that is so crucial for a scaling and quite often... Well, I know a lot of quick wins can be had with retention. So maybe just give the listeners a little bit of background how you got into everything.

Alex McEachern:
Sure. So sometimes I like to say I trip and fell into eCommerce. So I went to school for marketing and when I graduated, I was looking for something. Found a job at a small Shopify app which was called Sweet Tooth at the time, which eventually rebranded into Smile, which is a loyalty and rewards program provider for Shopify stores. So spent about five years there working with thousands of brands putting their loyalty programs, points programs, referral programs together, and just developed a passion for how do we get customers to come back and make a second purchase? Regardless of if it was with loyalty programs, basically any sort of tactic. And from there, ended up starting my own kind of boutique retention consulting firm as well as working now at [Lupe Returns 00:02:19], which a lot of people don't view as a retention tactic, but I like to talk about returns and exchanges as one of the best retention tactics you can use.

Richard Hill:
Yeah, yeah, yeah. Okay, so for the guys that are listening in, how would you define retention? What is it exactly? It sounds pretty obvious, but I think there's a bit more to it than some people will give it credit.

Alex McEachern:
Yeah, I think it's one of those things where it's obvious in it's definition, but when you start to think of how you're actually going to do it, that's where it can become a little bit more complicated. So I would define customer retention and try to keep it as simple as possible, as it's the act of growing your business through people who have already made a purchase from you before, growing through your existing customer base, where all of the... And you alluded to at the beginning of the episode where, "Hey, we don't talk a lot about this," and I feel like that's just the industry in general. eCommerce is very acquisition focused rather than retention focused.

Richard Hill:
Yeah. I think this is it, isn't it? I think the guys that are listening in will relate. It's like focused on, "What's been the ad spend, what's been the ROAS this year, this month, this week. We spent 100 grand on ads this week, we've got 800 grand back, eight times, that works in most cases." But hang on a minute, we've got maybe 20 million dollars worth or pounds worth of sales in the last six months. How about we get them to buy again and again and again? And hang on a minute, that 20 million could actually be an additional 50 million further down the line rather than always trying to find new business. So how would you say... Maybe just go back a tad. You talk about returns and returns as a... That's a make or break part of any eCom store, especially in certain industries like fashion, et cetera. Maybe give our listeners some straight to the point tips around how to turn that returns... what might be a nightmare in some industries, which I know it can be, to a retention piece, a repeat business piece.

Alex McEachern:
Yeah, I think the best way to define that is looking at that post-purchase experience. We talked about ROAS, we talked about all these things we're looking at to get to the purchase point. Customer retention lives at that purchase point until, "When do I get them to come back?" And we'll call that first one a return purchase and, "How do I get them to repeat and then become loyal?" And you're right, returns are a make or break experience, but unfortunately a lot of people view it like you said, it's a nightmare. "I have to refund the money, I have to pay for the shipment out, now I have to pay for the shipment back." Potentially there's a lot of costs associated with it. And I think a lot of brands have always looked at it as a cost reduction play, a logistics play, and we're starting to see brands look at it more as a marketing play and a retention play. And the best way to look at that is don't think of return and refund synonymously. I think a lot of us, we hear return and we're like, "Oh, I'm giving the money back." But you mentioned apparel, let's talk accessories like sunglasses or handbags. A lot of times someone ends up with something that's not perfect for them. It might be a size too small, a size too large, colour's just a little bit off and if we make it difficult for... to try to cut our costs, make it difficult for them to find that return policy page, make it difficult to actually start a return and get that sent back, we're kind of forcing our customers to hold onto something they don't love. And when they're doing that, we're making a repeat purchase way less likely, a referral way less likely, and just people generally talking about your brand is not going to happen as much when that becomes a thing.

Richard Hill:
Yeah, can entirely relate. I was thinking right now my wife's been ordering various summer dresses and this, that, and the other and buying off sites that we don't normally buy off, or she doesn't normally buy off, and trying different things on. And as clothing is, style and colour, they look great on the virtual [inaudible 00:06:26] and then when you get them home it's like, "Oh, okay. That definitely isn't my colour," or whatever, or my wife's colour, she would say. But then sending them back, I know she's like, "Oh God, I've got to go to the post office with this, ah, flipping heck, it's going to cost eight pounds to send that back." And just listening through those pain points, that it's just trying to make it as easy as possible, as clear as possible is what you're saying, so it's very, very clear from [inaudible 00:06:49] once you place that order, or definitely when you receive that order, I think certain brands, they'll put a returns packet or returns labels in. But some don't still, which is pretty bizarre, I think, in this day and age really, some of them just don't even... they just ship you the goods and thank you for ordering. And I think if you had the option, if it was very, very clear, you're probably... you're obviously going to get that really good experience, but you just straight away, you're like... I think you're probably less likely to send it back in one way, but you've got the option to.

Alex McEachern:
Interesting too, because when you talked about your wife buying those dresses, what we've found is actually 67% of shoppers are checking the return policy before they even buy. So we view it as a post-purchase thing, but how do I reduce that perceived risk of making that purchase? Because like you said, a lot of customers are like, "Eight pounds, post office, oh." If there's no pre-packaged return slip it's like, "Oh, I've got to call someone, there's a number on there." Or even worse, send this back to X address which is actually just a dock somewhere, and cross your fingers and hope something happens.

Richard Hill:
Yeah and I think, obviously, more and more people are jumping on the old Amazon train and they believe and they know that, really, that that's an easy way to send stuff back. You've got to be able to compete with that, at least. So I think for the guys that are listening in, have a look at those terms and conditions or delivery/returns pages, they've got to be on the site. You might read them and think it's clear, but I would maybe get a third party to run through them and is it really clear? As somebody that's never bought from your brand before, is it really crystal clear and is it a good proposition for somebody who's about to send something? Especially in apparel and fashion, there's quite a likelihood or a higher likelihood they're going to send it back. Is it very clear on how to do that, what the costs are going to be, if any? You're more likely to get the order, is what we're saying, the pre pre-order, as opposed to getting the order and then it turning into a "No chance I'm ever going to order from that company again" potentially, yeah.

Alex McEachern:
Exactly. And 52% of returns that happen are because someone has the wrong size. So in that process, if you can encourage someone to take an exchange, you can keep that customer relationship alive, you can get them into a new product... and an example is, someone's buying shorts, it's, "Oh, I got a size too small and then I go and I interact with your return process," and it's like, "Oh, Alex, just return those shorts for a size higher." And I'm like, "Oh, I now know that that large is going to be the right one, because I already tried the medium. Let me grab two pairs of shorts now, because I now know my size and I'm more comfortable with it."

Richard Hill:
Totally. That has exactly happened to me this week. I have to admit, I went into a store and bought a certain size, and I tried the two sizes on, and the larger size unfortunately fits. Which is a little disappointing, but hey, that's lockdown for you. But now I know the size in that particular brand and I think they're a perfect fit. I will go on like it's fully my intention to buy... obviously, the weather's pretty good at the moment, which is quite rare. So I will go and buy from their online or from online stores that sell that brand, that particular brand and size. But as you, it could take an order or two to find that perfect size. Obviously different brands have got different fittings. I am a big chap, I'm 6'7". I can't just walk in and expect to go and buy... they sell this, that, and the other and it fit, very rarely does that ever happen as a chap. And it's exactly the same for ladies I'm sure, different sizes in different brands, some are smaller. But then they're where they get... I walk into Hugo Boss, took an XL and it's like a child's fit. It's like, "How can this be an XL? This is ridiculous." Maybe it's just me, but... Okay, so obviously, absolutely key, pre-purchase and post-purchase, obviously, to get those purchases in the first place, great. But then retaining those customers and having that lifetime value, it's absolutely key to any business, doesn't matter what you sell. If you can get people to come back, that's the make or break. But what would you recommend to our listeners to measure how well you're doing with retention?

Alex McEachern:
This is such an interesting question, because the term... and you already alluded to it there with CLV or customer lifetime value, that's this holy grail metric that everyone's chasing. But if you go and do a Google search of how to calculate customer lifetime value, you get some pretty crazy equations on how to make it happen. So I think customer lifetime value, it's the one you should be striving for. There's so many different ways to calculate it. My biggest piece of advice would be, if you're going to do it, just pick your way of calculating customer lifetime value and be consistent, so that you can pick it today, benchmark it and then basically see the improvements over time. So my easy way for CLV is basically just purchase frequency, average order value, and then lifetime is the hard part to understand. Very few brands have enough data to be like, "Oh, the average lifespan of a customer is 2.4 years." A lot of people just don't have that level of insight. Sometimes I even like to just do customer value. Let's look at one year, purchase frequency, average order value, what's the average customer worth over the course of a year? And if you have something that... they're not purchasing that frequently, I like to just set a number of two or three years, and again, just be consistent. There's a couple others things you could use as well. You could use something like repeat customer rate. For anyone who's using Shopify, returning customer rate I believe is what they have in the Shopify backend, which is a bit confusing. A lot of people think that's like, "Oh, if I pick my one month period and it says 25%, that means that 25% of my customers are repeating in my time period." That's not actually true with what you're looking at in there, it's actually showing you how many customers in that time period are not making their first purchase. So that 25% would be 25% of your purchases came from people who are making their second plus purchase.

Richard Hill:
Yeah, [crosstalk 00:13:06].

Alex McEachern:
Not that those people have returned.

Richard Hill:
Yeah, understood, understood. So obviously you're dealing with a lot of companies that are implementing retention strategies or improving their retention strategies. What are some of the consistent things that you see people doing wrong? What are some of the things that our listeners need to really, straight away, can go and look for and stop doing or avoid doing?

Alex McEachern:
Yeah, so the one tactic that applies to pretty much every single industry, and I would say this is low hanging fruit, you allude at the beginning, the quick win, is those post-purchase flows. So when someone makes that purchase, what is the email flow that we're going to put together to encourage them to come back and make another purchase? Now, this is one of those things where it's easy in principle. I can use my email provider and build something. A lot of people get this wrong. I just bought two things last week, I haven't even got them yet, and I'm already getting emails to come and purchase something new. So it's a tactic where you need to think about the value ad that you can put into the process there. Don't think about, "How do I get someone to come and make another purchase as quickly as possible?" You want to be thinking in that post-purchase flow, "How do I get them to see value or achieve value with what I've sold them right now?" So think supplements brand as an example, are they going to want to buy something again as soon as they've taken three supplements? No, you're going to want to educate them, explain, "How long is this going to take? What kind of progress should I be seeing in the meantime?" Being able to email like that those value-add emails between the purchase, that's going to make someone more likely to come back. And if you start to measure what your average time between purchases is, you can use your post-purchase flow and line it up perfectly. So it's like, "We know this last 40 days. Okay, let's keep people engaged in the between space and be very purposeful with when we're going to say, 'Hey, it's time to come back and make another purchase.'"

Richard Hill:
Yeah. So you would say that you see a lot of people set [inaudible 00:15:06]... Somebody's just bought something off a store and then they're trying to sell them something again the next day, the next day, that's the mistake. Whereas what they should be doing is figuring out those time scales. Obviously different industries, different things, there's maybe some appropriate cross-sell, upsell opportunities, but typically yeah. You bought a new whatever it will be, maybe a coat, and then they're showing you another coat. It's like hang on a minute, I don't need another coat. But in time. Any other big mistakes that you see?

Alex McEachern:
I say to add on to that one, it's not even just "buy something again", it's the worst when they're saying "buy the exact same thing again," like, I just bought that. The other thing is like, "Oh, refer your friends," or, "Leave a review." When you ask for those things as well... When we have our brand hat on, it's very easy to get caught in, "Okay, I need these things to happen." It's very important for us to put our customer hat on. And big tip for people who are putting those post-purchase flows together, go buy from some brands that you really respect and create a filter so that you're seeing all of the emails that you send you, and evaluate it as a customer. It's very difficult for us to evaluate our own email flows as a brand owner or an email marketer, much easier to do it as a customer.

Richard Hill:
Yeah. No, I like that. Yeah, that's probably a good spot to maybe pause the episode, think about who your big players are in your industry, and maybe go and buy something from them. Don't go crazy. Maybe go crazy, but go and buy something from them and understand how they're doing it and get some insight into... and over the next three months or whatever, you're going to see they didn't ask for the review on day two. They made sure that you were really, really happy and X, Y, zed and educated you on the different... whether it's an ethical thing or whatever's happening in the world, they're aligning things that are topical or [inaudible 00:17:01] maybe three weeks later ask for the review when you've actually had a chance to try the thing on and use the thing, rather than the day after you bought it, "How was the..." "Hang on a minute, I haven't even took it out the box yet." Yeah, yeah.

Alex McEachern:
It's interesting to because, like I said, post-purchase flows, they're something that everyone can use, but I think the most important thing for any brand who's like, "I want to invest more heavily in customer retention." I call it the retention marketing matrix. I think the best thing for you to do is to try to place what you sell, what your brand does into one of the quadrants, so that you can select the best retention tactic possible. Because a loyalty program doesn't work for everyone. So think about a matrix where it's purchase frequency and average order value. If you have low average order value and high purchase frequency, you are a home run for customer retention. Think coffee, think consumables like that. Loyalty programs, they're going to work extremely well for you because you're able to keep people engaged on the purchase quickly. But if you think about low purchase frequency, high average order value, I don't know, I'm trying to think of a... pianos, as an example. A loyalty program's probably not going to work as well for a grand piano, but it doesn't mean there aren't retention tactics to be used. And I think one of the most overlooked retention strategies is actually your products. And you alluded to it with the cross-sell and the upsell is, "Hey, maybe someone's only buying a piano once every..." I don't know, I don't play the piano, every 10 years maybe. But key cleaners, string replacements, what are the other things from a product perspective you can be adding on here to make sure that they're coming to you for that?

Richard Hill:
Yeah. No, that's great, that's great. So before we move on, would you say there's any other tips for retention? So we've covered quite a few there. Obviously it's very dependent on what you sell. Obviously, we're not going to buy a piano every three months, but we might well want the music sheets for it and the... whatever your choice of singer is, you might want to play along with...

Alex McEachern:
[inaudible 00:19:02] or whatever it may be. Music... yeah.

Richard Hill:
Yep. I haven't got room for two grand pianos in my house. But anything else you would add in terms of tips for improving retention?

Alex McEachern:
Yeah, I would say my final tip would be don't forget about the pre-purchase. So think content, think site experience, think about... there's a lot of ways that people can engage with you. They might not be purchasing from you every day, they likely aren't purchasing from you every day. But they can consume content and interact with you every single day, so think of how you can keep people warm and engaged, whether that's through blog or YouTube. Some fantastic examples of that is like beard brand with their YouTube channel. Being able to get tips and tricks on beard care that aren't just "buy the product". I can keep myself engaged and entertained with the brand so that when I am ready to buy something, I can come in and then we can start to use some of these other retention tactics. But remember that how you start the relationship has a huge impact on the actual longevity of the relationship and the health of the relationship. When you're always discounting your brand, there's another thing. If you're always starting the relationship off with 25% off, you've now established that's what the relationship's going to be like until the end. They don't view you at the regular price, they view you at the 25% off.

Richard Hill:
I would say guys, pause and rewind 60 seconds and listen to that again. Yeah, I think that's some absolute gold there Alex, thank you. So let's dive into a specific strategy. Tell us about a strategy that you've worked on that has improved retention. Let's get into specifics. No need to name the brand unless you are willing to, but the industry, the type of thing, very specific strategy that's moved the needle.

Alex McEachern:
Yeah, so I think the one that I would recommend for a lot of listeners is linking your post-purchase flow with a quiz experience or some sort of interactive experience. So what I mean by this is, you can be a lot more tailored with the type of post-purchase communication you use when you know why someone is making this purchase. So as an example, in, let's call it, hair care. If I know that I am purchasing hair care because I have thinning hair and in my quiz, I'm starting to ask people ahead of time, "Why are you purchasing this? What goals are you looking to achieve?" Now when someone makes that purchase, I can start to introduce content in there where it's like, "Hey, Alex, you said that you have thinning edges of your hair. Here are some of our top tips to how to make that happen." You can also make product recommendations on how to use it. So if someone lets you know ahead of time that they are trying to achieve something, that your product, you might need to use it a little bit more heavily. You might need to, in a shampoo example, it might be a double shampoo versus just doing it once. If you know that you can make that recommendation because... I don't know, you've probably seen a million shampoo and conditioner commercials where they're like, "Lather, rinse, repeat." And everyone is like, "Why the heck would I actually repeat? That's just a marketing play to get me to buy more." But if there actually is a reason to do it, you can know that from that quiz experience up front and actually adjust your post-purchase flows.

Alex McEachern:
But one thing I do see a little too often here is trying to get too granular. From that quiz experience, try to find two or three things that you can start to tailor your messaging and your product messaging around and try to build three, maybe four flows. I've seen a couple people try to get seven or eight going and it just gets way too confusing and hard to manage.

Richard Hill:
So you're saying the quizzes in the emails that we're sending, yeah? Or on the site?

Alex McEachern:
On the site, actually. And I've seen a lot of people be successful with actually having their acquisition into a quiz experience, where I'm getting that email, I'm getting what I would typically do, "Get 5% off, get 10% off, give me your email address." It's like, "Hey, let's get their email address and give them something back in return." So actually pushing people to that ahead of time so that I know that it's held in my email CRM, so that when I get that purchase, I know these talking points for them and I can adjust my flows accordingly.

Richard Hill:
I have to say, it's something we're working on internally for one of our eCommerce, our RFI agency. Now you come in with... we ask you the question and then obviously you've applied "yes" or "no", "yes" or "no", you go into another set of questions which is relevant to the yes or the no, and ultimately you're going to end up in one of, in our instance, one of three places, whether that's to educate you more on X, Y, zed, whether that's you're ready to purchase something so then we'll show you a particular option there to request what to purchase ultimately, or you need to find out more about something and you have quite an advanced understanding of the topic, so it's more of an advanced education piece, or you're more of a newer customer, so obviously it's making sure that you understand the fundamentals, so that's a different type of education piece. And I think it's something we have been playing with for quite some time, it's quite surprising the results. And a lot of people I know that are more the digital marketing space as opposed to the physical products and agency space, but digital marketing wise, I know that's [inaudible 00:24:15] information products et cetera, quiz funnels are very, very popular at the moment, yeah.

Alex McEachern:
Yeah, they're definitely becoming more popular in the physical goods space as well. And another quick example of that is I was talking to a jewellery brand, and they're basically asking people, "Are you buying this for yourself or are you buying it as a gift?" And think about the post-purchase flows you can build there, right? I buying a piece of jewellery for my wife. If you start sending me, "Hey, here is the matching set for that." I'm like, "It's not for me, it's for someone else." But if you now know I bought this as a gift, Valentine's Day, like who'd you buy it for, come Valentine's day, here's what you should be looking for. Hey, the first purchase anniversary. "I'm guessing you bought this for a special occasion. That time's coming up again. Here's what we have to offer."

Richard Hill:
Yeah, smart. That's smart. So thank you for that. I think one of the things that will be on everyone's mind, okay? We've got to focus on retention, yeah, of course. We've got the acquisition, we've got the retention. What do you think should be the split? I know that's quite a tricky one, but I think so many companions obviously are completely focused on the acquisition and there's probably zero on the retention and they need to sort out what they're doing completely. But how do you agree a focus or a split, in terms of budget, in terms of time, or where do you even start with making some decisions on that?

Alex McEachern:
You're right, it's not a straightforward like, "Oh, just split it down the middle, it should be 50/50." And I remember seeing an Adobe study where they were saying for every dollar put into marketing online, five cents of it was into retention efforts. So maybe there's a starting point, it's 90/5/5, 95 acquisition, 5% retention-

Richard Hill:
Is that because [crosstalk 00:26:01] you can't cancel it? They won't let you, basically? Yeah they say, "Oh, you've missed your cancellation period, see you in 11 months."

Alex McEachern:
Yeah. So there's the one extreme, but I do think that... and you probably see this with the brands you're working with as well, we're talking about ROAS. There's an obsession with customer acquisition, and I would argue that a lot of e-comm is skewing pretty heavily. Maybe not 95/5 but maybe 90/10, 80/20 right now. My answer is it actually depends on how established your business is. Obviously when you're first getting started you can't be 50/50 on acquisition/retention, I don't have an established enough customer base to be doing anything with. But I would say once you cross that, let's call it the million to three million dollar a year threshold, I think that's the point where you should actually start moving it more to 50/50. And as you grow, there's a finite amount of people out there that can buy your product. Eventually, if we just play the mathematics game, eventually there's no more people. You have to be reselling to the people that have already bought from you before. Now, that's an extreme case, but once you get to a certain size, the further you get down that growth trajectory, I would actually argue you want to be going more retention, less acquisition. So when you get to the size of some of the biggest brands that we see on Shopify, they're probably putting 60%, 60 cents for every dollar into customer retention versus acquisition.

Richard Hill:
Then when you think about Amazon, yeah, retention. Sorry... yeah, retention. They're just always pulling you back in, aren't they? Okay-

Alex McEachern:
They're definitely masters of that.

Richard Hill:
Yeah, it's just too good. I have an unfortunate addiction which I'm trying to quash, which is Amazon, but I'm not doing very well at it to be fair. So in terms of brands, the guys that are listening, obviously you work with a lot of independent brands, big brands, a whole mix of brands and obviously there's the big brands out there that neither of us are working with. Who would you say has some of the best retention strategies if some of our listeners wanted to really go and pick at some people that are doing it well and just spy on a few brands that are doing it really, really well, who would you spotlight?

Alex McEachern:
Yeah, there's two brands that I would spy on that you don't necessarily need to be buying something from online but have great retention tactics that you can remix, steal like an artist from. Starbucks, Sephora. Those are two big brands that you can look to and have amazing customer retention tactics. Loyalty programs, the way they operate. If you buy something from Sephora, Sephora's a great... and I know the men listening might not be buying something from Sephora. They've got some-

Richard Hill:
I'm not familiar with that one, actually.

Alex McEachern:
Oh, Sephora, okay. Sephora's a makeup company, US, Canada. I've dug way too deep on their loyalty/VIP program. I think it's one of... if you're looking to study a loyalty program, definitely go look at Sephora in terms of what they're doing. The tiered experiences, when you cross a certain threshold, you get different perks. A lot of them are not sales or physical things but hey, events, "Come and participate in this special event once you pass a threshold."

Richard Hill:
Yeah, yeah, I like that.

Alex McEachern:
And if you go on Twitter or Facebook and search, I think it's the VIB instead of the VIP program, you get people bragging online that they spent $1000 in the last year at Sephora. So how great is that for you as a brand?

Richard Hill:
The mythical black card at Nando's, yeah.

Alex McEachern:
Yeah, so I think Sephora, Starbucks, those are great places to look. There's a Canadian brand, Knix, they sell women's underwear. I think they do a fantastic job at this. If you wanted to buy something or just study what they're doing, the way that they're approaching the pre-purchase experience, setting up the relationship the correct way. If you go to their site they also have a consultant or a concierge to help people find more products, matching products, I bought something in the past, I liked it, what else should I be adding onto that? Those are some of my go-to's, I would go look at that.

Richard Hill:
Yeah, well I know I'm going to look at those. A couple there that I'm not familiar with, so yeah. Great. Well thanks Alex, it's been an absolute blast. It's gone very, very quickly, I think that's been a... there was fantastic takeaways there. I always like to end every episode with a book recommendation. If you could recommend one book to our listeners, what would that be?

Alex McEachern:
One book, everyone in eCommerce, if you want to focus on retention, should pick up the book Never Lose a Customer Again. It's by Joey Coleman. It's a fantastic read. It goes over basically how to build a strategy to keep customers loyal, and his argument is that the first 100 days are crucial. So he gives you a framework that you can take for your brand to be like, "How do I get people engaged and coming back within those first 100 days?"

Richard Hill:
Yep, love it, love it. That's two clicks away, after we've finished. Okay, so the guys that are listening want to find out more about you Alex, what's the best place to do that and best way to do that?

Alex McEachern:
Yeah, I'm pretty active on LinkedIn, so if anyone wants to follow along there. I also have an eCommerce podcast, it's called The Exchange. We cover only customer experience and retention topics, so if people want to learn a bit more about retention as a tactic, come follow along on the podcast there.

Richard Hill:
Yeah. Well thanks Alex, thank you so much and I look forward to catching up again soon. Thank you.

Alex McEachern:
Thanks for having me, it was fun.

Richard Hill:
Thank you for listening to the eCom@One eCommerce podcast. If you enjoyed today's show, please hit subscribe and don't forget to sign up to our eCommerce newsletter and leave us a review on iTunes. This podcast has been brought to you by our team here at eComOne, the eCommerce marketing agency.

Richard Hill:
Hi there, I'm Richard Hill, the host of eCom@One. Welcome to our 63rd episode. In that episode, I speak with Alex McEachern. Alex has helped hundreds of eCommerce stores implement retention strategies and specifically those sometimes pesky return strategies. Your customer's experience will be your differentiator, and Alex is a true expert in making the process enjoyable and more importantly, a revenue stream for the long-term. We talk about pre and post-purchase strategies for retention of customers, that all-important lifetime value of your customers and how to agree on a basic formula to work it out and increase it. Three simple strategies to avoid to improve retention and the split you should be thinking about if you're really looking to scale when it comes to investing in acquisition or retention. If you enjoy this episode, please make sure to subscribe so you're always the first to know when a new episode is released. Now, let's [inaudible 00:00:52] to this fantastic episode.

Richard Hill:
How you doing Alex?

Alex McEachern:
I'm doing all right Richard, how you doing?

Richard Hill:
I'm doing pretty well, I'm doing very well, in fact. I'm looking forward to getting all the juicy tips off you today. This is a topic that we've not really covered too much that we're going to delve into, and I know it's a topic that is so crucial for a scaling and quite often... Well, I know a lot of quick wins can be had with retention. So maybe just give the listeners a little bit of background how you got into everything.

Alex McEachern:
Sure. So sometimes I like to say I trip and fell into eCommerce. So I went to school for marketing and when I graduated, I was looking for something. Found a job at a small Shopify app which was called Sweet Tooth at the time, which eventually rebranded into Smile, which is a loyalty and rewards program provider for Shopify stores. So spent about five years there working with thousands of brands putting their loyalty programs, points programs, referral programs together, and just developed a passion for how do we get customers to come back and make a second purchase? Regardless of if it was with loyalty programs, basically any sort of tactic. And from there, ended up starting my own kind of boutique retention consulting firm as well as working now at [Lupe Returns 00:02:19], which a lot of people don't view as a retention tactic, but I like to talk about returns and exchanges as one of the best retention tactics you can use.

Richard Hill:
Yeah, yeah, yeah. Okay, so for the guys that are listening in, how would you define retention? What is it exactly? It sounds pretty obvious, but I think there's a bit more to it than some people will give it credit.

Alex McEachern:
Yeah, I think it's one of those things where it's obvious in it's definition, but when you start to think of how you're actually going to do it, that's where it can become a little bit more complicated. So I would define customer retention and try to keep it as simple as possible, as it's the act of growing your business through people who have already made a purchase from you before, growing through your existing customer base, where all of the... And you alluded to at the beginning of the episode where, "Hey, we don't talk a lot about this," and I feel like that's just the industry in general. eCommerce is very acquisition focused rather than retention focused.

Richard Hill:
Yeah. I think this is it, isn't it? I think the guys that are listening in will relate. It's like focused on, "What's been the ad spend, what's been the ROAS this year, this month, this week. We spent 100 grand on ads this week, we've got 800 grand back, eight times, that works in most cases." But hang on a minute, we've got maybe 20 million dollars worth or pounds worth of sales in the last six months. How about we get them to buy again and again and again? And hang on a minute, that 20 million could actually be an additional 50 million further down the line rather than always trying to find new business. So how would you say... Maybe just go back a tad. You talk about returns and returns as a... That's a make or break part of any eCom store, especially in certain industries like fashion, et cetera. Maybe give our listeners some straight to the point tips around how to turn that returns... what might be a nightmare in some industries, which I know it can be, to a retention piece, a repeat business piece.

Alex McEachern:
Yeah, I think the best way to define that is looking at that post-purchase experience. We talked about ROAS, we talked about all these things we're looking at to get to the purchase point. Customer retention lives at that purchase point until, "When do I get them to come back?" And we'll call that first one a return purchase and, "How do I get them to repeat and then become loyal?" And you're right, returns are a make or break experience, but unfortunately a lot of people view it like you said, it's a nightmare. "I have to refund the money, I have to pay for the shipment out, now I have to pay for the shipment back." Potentially there's a lot of costs associated with it. And I think a lot of brands have always looked at it as a cost reduction play, a logistics play, and we're starting to see brands look at it more as a marketing play and a retention play. And the best way to look at that is don't think of return and refund synonymously. I think a lot of us, we hear return and we're like, "Oh, I'm giving the money back." But you mentioned apparel, let's talk accessories like sunglasses or handbags. A lot of times someone ends up with something that's not perfect for them. It might be a size too small, a size too large, colour's just a little bit off and if we make it difficult for... to try to cut our costs, make it difficult for them to find that return policy page, make it difficult to actually start a return and get that sent back, we're kind of forcing our customers to hold onto something they don't love. And when they're doing that, we're making a repeat purchase way less likely, a referral way less likely, and just people generally talking about your brand is not going to happen as much when that becomes a thing.

Richard Hill:
Yeah, can entirely relate. I was thinking right now my wife's been ordering various summer dresses and this, that, and the other and buying off sites that we don't normally buy off, or she doesn't normally buy off, and trying different things on. And as clothing is, style and colour, they look great on the virtual [inaudible 00:06:26] and then when you get them home it's like, "Oh, okay. That definitely isn't my colour," or whatever, or my wife's colour, she would say. But then sending them back, I know she's like, "Oh God, I've got to go to the post office with this, ah, flipping heck, it's going to cost eight pounds to send that back." And just listening through those pain points, that it's just trying to make it as easy as possible, as clear as possible is what you're saying, so it's very, very clear from [inaudible 00:06:49] once you place that order, or definitely when you receive that order, I think certain brands, they'll put a returns packet or returns labels in. But some don't still, which is pretty bizarre, I think, in this day and age really, some of them just don't even... they just ship you the goods and thank you for ordering. And I think if you had the option, if it was very, very clear, you're probably... you're obviously going to get that really good experience, but you just straight away, you're like... I think you're probably less likely to send it back in one way, but you've got the option to.

Alex McEachern:
Interesting too, because when you talked about your wife buying those dresses, what we've found is actually 67% of shoppers are checking the return policy before they even buy. So we view it as a post-purchase thing, but how do I reduce that perceived risk of making that purchase? Because like you said, a lot of customers are like, "Eight pounds, post office, oh." If there's no pre-packaged return slip it's like, "Oh, I've got to call someone, there's a number on there." Or even worse, send this back to X address which is actually just a dock somewhere, and cross your fingers and hope something happens.

Richard Hill:
Yeah and I think, obviously, more and more people are jumping on the old Amazon train and they believe and they know that, really, that that's an easy way to send stuff back. You've got to be able to compete with that, at least. So I think for the guys that are listening in, have a look at those terms and conditions or delivery/returns pages, they've got to be on the site. You might read them and think it's clear, but I would maybe get a third party to run through them and is it really clear? As somebody that's never bought from your brand before, is it really crystal clear and is it a good proposition for somebody who's about to send something? Especially in apparel and fashion, there's quite a likelihood or a higher likelihood they're going to send it back. Is it very clear on how to do that, what the costs are going to be, if any? You're more likely to get the order, is what we're saying, the pre pre-order, as opposed to getting the order and then it turning into a "No chance I'm ever going to order from that company again" potentially, yeah.

Alex McEachern:
Exactly. And 52% of returns that happen are because someone has the wrong size. So in that process, if you can encourage someone to take an exchange, you can keep that customer relationship alive, you can get them into a new product... and an example is, someone's buying shorts, it's, "Oh, I got a size too small and then I go and I interact with your return process," and it's like, "Oh, Alex, just return those shorts for a size higher." And I'm like, "Oh, I now know that that large is going to be the right one, because I already tried the medium. Let me grab two pairs of shorts now, because I now know my size and I'm more comfortable with it."

Richard Hill:
Totally. That has exactly happened to me this week. I have to admit, I went into a store and bought a certain size, and I tried the two sizes on, and the larger size unfortunately fits. Which is a little disappointing, but hey, that's lockdown for you. But now I know the size in that particular brand and I think they're a perfect fit. I will go on like it's fully my intention to buy... obviously, the weather's pretty good at the moment, which is quite rare. So I will go and buy from their online or from online stores that sell that brand, that particular brand and size. But as you, it could take an order or two to find that perfect size. Obviously different brands have got different fittings. I am a big chap, I'm 6'7". I can't just walk in and expect to go and buy... they sell this, that, and the other and it fit, very rarely does that ever happen as a chap. And it's exactly the same for ladies I'm sure, different sizes in different brands, some are smaller. But then they're where they get... I walk into Hugo Boss, took an XL and it's like a child's fit. It's like, "How can this be an XL? This is ridiculous." Maybe it's just me, but... Okay, so obviously, absolutely key, pre-purchase and post-purchase, obviously, to get those purchases in the first place, great. But then retaining those customers and having that lifetime value, it's absolutely key to any business, doesn't matter what you sell. If you can get people to come back, that's the make or break. But what would you recommend to our listeners to measure how well you're doing with retention?

Alex McEachern:
This is such an interesting question, because the term... and you already alluded to it there with CLV or customer lifetime value, that's this holy grail metric that everyone's chasing. But if you go and do a Google search of how to calculate customer lifetime value, you get some pretty crazy equations on how to make it happen. So I think customer lifetime value, it's the one you should be striving for. There's so many different ways to calculate it. My biggest piece of advice would be, if you're going to do it, just pick your way of calculating customer lifetime value and be consistent, so that you can pick it today, benchmark it and then basically see the improvements over time. So my easy way for CLV is basically just purchase frequency, average order value, and then lifetime is the hard part to understand. Very few brands have enough data to be like, "Oh, the average lifespan of a customer is 2.4 years." A lot of people just don't have that level of insight. Sometimes I even like to just do customer value. Let's look at one year, purchase frequency, average order value, what's the average customer worth over the course of a year? And if you have something that... they're not purchasing that frequently, I like to just set a number of two or three years, and again, just be consistent. There's a couple others things you could use as well. You could use something like repeat customer rate. For anyone who's using Shopify, returning customer rate I believe is what they have in the Shopify backend, which is a bit confusing. A lot of people think that's like, "Oh, if I pick my one month period and it says 25%, that means that 25% of my customers are repeating in my time period." That's not actually true with what you're looking at in there, it's actually showing you how many customers in that time period are not making their first purchase. So that 25% would be 25% of your purchases came from people who are making their second plus purchase.

Richard Hill:
Yeah, [crosstalk 00:13:06].

Alex McEachern:
Not that those people have returned.

Richard Hill:
Yeah, understood, understood. So obviously you're dealing with a lot of companies that are implementing retention strategies or improving their retention strategies. What are some of the consistent things that you see people doing wrong? What are some of the things that our listeners need to really, straight away, can go and look for and stop doing or avoid doing?

Alex McEachern:
Yeah, so the one tactic that applies to pretty much every single industry, and I would say this is low hanging fruit, you allude at the beginning, the quick win, is those post-purchase flows. So when someone makes that purchase, what is the email flow that we're going to put together to encourage them to come back and make another purchase? Now, this is one of those things where it's easy in principle. I can use my email provider and build something. A lot of people get this wrong. I just bought two things last week, I haven't even got them yet, and I'm already getting emails to come and purchase something new. So it's a tactic where you need to think about the value ad that you can put into the process there. Don't think about, "How do I get someone to come and make another purchase as quickly as possible?" You want to be thinking in that post-purchase flow, "How do I get them to see value or achieve value with what I've sold them right now?" So think supplements brand as an example, are they going to want to buy something again as soon as they've taken three supplements? No, you're going to want to educate them, explain, "How long is this going to take? What kind of progress should I be seeing in the meantime?" Being able to email like that those value-add emails between the purchase, that's going to make someone more likely to come back. And if you start to measure what your average time between purchases is, you can use your post-purchase flow and line it up perfectly. So it's like, "We know this last 40 days. Okay, let's keep people engaged in the between space and be very purposeful with when we're going to say, 'Hey, it's time to come back and make another purchase.'"

Richard Hill:
Yeah. So you would say that you see a lot of people set [inaudible 00:15:06]... Somebody's just bought something off a store and then they're trying to sell them something again the next day, the next day, that's the mistake. Whereas what they should be doing is figuring out those time scales. Obviously different industries, different things, there's maybe some appropriate cross-sell, upsell opportunities, but typically yeah. You bought a new whatever it will be, maybe a coat, and then they're showing you another coat. It's like hang on a minute, I don't need another coat. But in time. Any other big mistakes that you see?

Alex McEachern:
I say to add on to that one, it's not even just "buy something again", it's the worst when they're saying "buy the exact same thing again," like, I just bought that. The other thing is like, "Oh, refer your friends," or, "Leave a review." When you ask for those things as well... When we have our brand hat on, it's very easy to get caught in, "Okay, I need these things to happen." It's very important for us to put our customer hat on. And big tip for people who are putting those post-purchase flows together, go buy from some brands that you really respect and create a filter so that you're seeing all of the emails that you send you, and evaluate it as a customer. It's very difficult for us to evaluate our own email flows as a brand owner or an email marketer, much easier to do it as a customer.

Richard Hill:
Yeah. No, I like that. Yeah, that's probably a good spot to maybe pause the episode, think about who your big players are in your industry, and maybe go and buy something from them. Don't go crazy. Maybe go crazy, but go and buy something from them and understand how they're doing it and get some insight into... and over the next three months or whatever, you're going to see they didn't ask for the review on day two. They made sure that you were really, really happy and X, Y, zed and educated you on the different... whether it's an ethical thing or whatever's happening in the world, they're aligning things that are topical or [inaudible 00:17:01] maybe three weeks later ask for the review when you've actually had a chance to try the thing on and use the thing, rather than the day after you bought it, "How was the..." "Hang on a minute, I haven't even took it out the box yet." Yeah, yeah.

Alex McEachern:
It's interesting to because, like I said, post-purchase flows, they're something that everyone can use, but I think the most important thing for any brand who's like, "I want to invest more heavily in customer retention." I call it the retention marketing matrix. I think the best thing for you to do is to try to place what you sell, what your brand does into one of the quadrants, so that you can select the best retention tactic possible. Because a loyalty program doesn't work for everyone. So think about a matrix where it's purchase frequency and average order value. If you have low average order value and high purchase frequency, you are a home run for customer retention. Think coffee, think consumables like that. Loyalty programs, they're going to work extremely well for you because you're able to keep people engaged on the purchase quickly. But if you think about low purchase frequency, high average order value, I don't know, I'm trying to think of a... pianos, as an example. A loyalty program's probably not going to work as well for a grand piano, but it doesn't mean there aren't retention tactics to be used. And I think one of the most overlooked retention strategies is actually your products. And you alluded to it with the cross-sell and the upsell is, "Hey, maybe someone's only buying a piano once every..." I don't know, I don't play the piano, every 10 years maybe. But key cleaners, string replacements, what are the other things from a product perspective you can be adding on here to make sure that they're coming to you for that?

Richard Hill:
Yeah. No, that's great, that's great. So before we move on, would you say there's any other tips for retention? So we've covered quite a few there. Obviously it's very dependent on what you sell. Obviously, we're not going to buy a piano every three months, but we might well want the music sheets for it and the... whatever your choice of singer is, you might want to play along with...

Alex McEachern:
[inaudible 00:19:02] or whatever it may be. Music... yeah.

Richard Hill:
Yep. I haven't got room for two grand pianos in my house. But anything else you would add in terms of tips for improving retention?

Alex McEachern:
Yeah, I would say my final tip would be don't forget about the pre-purchase. So think content, think site experience, think about... there's a lot of ways that people can engage with you. They might not be purchasing from you every day, they likely aren't purchasing from you every day. But they can consume content and interact with you every single day, so think of how you can keep people warm and engaged, whether that's through blog or YouTube. Some fantastic examples of that is like beard brand with their YouTube channel. Being able to get tips and tricks on beard care that aren't just "buy the product". I can keep myself engaged and entertained with the brand so that when I am ready to buy something, I can come in and then we can start to use some of these other retention tactics. But remember that how you start the relationship has a huge impact on the actual longevity of the relationship and the health of the relationship. When you're always discounting your brand, there's another thing. If you're always starting the relationship off with 25% off, you've now established that's what the relationship's going to be like until the end. They don't view you at the regular price, they view you at the 25% off.

Richard Hill:
I would say guys, pause and rewind 60 seconds and listen to that again. Yeah, I think that's some absolute gold there Alex, thank you. So let's dive into a specific strategy. Tell us about a strategy that you've worked on that has improved retention. Let's get into specifics. No need to name the brand unless you are willing to, but the industry, the type of thing, very specific strategy that's moved the needle.

Alex McEachern:
Yeah, so I think the one that I would recommend for a lot of listeners is linking your post-purchase flow with a quiz experience or some sort of interactive experience. So what I mean by this is, you can be a lot more tailored with the type of post-purchase communication you use when you know why someone is making this purchase. So as an example, in, let's call it, hair care. If I know that I am purchasing hair care because I have thinning hair and in my quiz, I'm starting to ask people ahead of time, "Why are you purchasing this? What goals are you looking to achieve?" Now when someone makes that purchase, I can start to introduce content in there where it's like, "Hey, Alex, you said that you have thinning edges of your hair. Here are some of our top tips to how to make that happen." You can also make product recommendations on how to use it. So if someone lets you know ahead of time that they are trying to achieve something, that your product, you might need to use it a little bit more heavily. You might need to, in a shampoo example, it might be a double shampoo versus just doing it once. If you know that you can make that recommendation because... I don't know, you've probably seen a million shampoo and conditioner commercials where they're like, "Lather, rinse, repeat." And everyone is like, "Why the heck would I actually repeat? That's just a marketing play to get me to buy more." But if there actually is a reason to do it, you can know that from that quiz experience up front and actually adjust your post-purchase flows.

Alex McEachern:
But one thing I do see a little too often here is trying to get too granular. From that quiz experience, try to find two or three things that you can start to tailor your messaging and your product messaging around and try to build three, maybe four flows. I've seen a couple people try to get seven or eight going and it just gets way too confusing and hard to manage.

Richard Hill:
So you're saying the quizzes in the emails that we're sending, yeah? Or on the site?

Alex McEachern:
On the site, actually. And I've seen a lot of people be successful with actually having their acquisition into a quiz experience, where I'm getting that email, I'm getting what I would typically do, "Get 5% off, get 10% off, give me your email address." It's like, "Hey, let's get their email address and give them something back in return." So actually pushing people to that ahead of time so that I know that it's held in my email CRM, so that when I get that purchase, I know these talking points for them and I can adjust my flows accordingly.

Richard Hill:
I have to say, it's something we're working on internally for one of our eCommerce, our RFI agency. Now you come in with... we ask you the question and then obviously you've applied "yes" or "no", "yes" or "no", you go into another set of questions which is relevant to the yes or the no, and ultimately you're going to end up in one of, in our instance, one of three places, whether that's to educate you more on X, Y, zed, whether that's you're ready to purchase something so then we'll show you a particular option there to request what to purchase ultimately, or you need to find out more about something and you have quite an advanced understanding of the topic, so it's more of an advanced education piece, or you're more of a newer customer, so obviously it's making sure that you understand the fundamentals, so that's a different type of education piece. And I think it's something we have been playing with for quite some time, it's quite surprising the results. And a lot of people I know that are more the digital marketing space as opposed to the physical products and agency space, but digital marketing wise, I know that's [inaudible 00:24:15] information products et cetera, quiz funnels are very, very popular at the moment, yeah.

Alex McEachern:
Yeah, they're definitely becoming more popular in the physical goods space as well. And another quick example of that is I was talking to a jewellery brand, and they're basically asking people, "Are you buying this for yourself or are you buying it as a gift?" And think about the post-purchase flows you can build there, right? I buying a piece of jewellery for my wife. If you start sending me, "Hey, here is the matching set for that." I'm like, "It's not for me, it's for someone else." But if you now know I bought this as a gift, Valentine's Day, like who'd you buy it for, come Valentine's day, here's what you should be looking for. Hey, the first purchase anniversary. "I'm guessing you bought this for a special occasion. That time's coming up again. Here's what we have to offer."

Richard Hill:
Yeah, smart. That's smart. So thank you for that. I think one of the things that will be on everyone's mind, okay? We've got to focus on retention, yeah, of course. We've got the acquisition, we've got the retention. What do you think should be the split? I know that's quite a tricky one, but I think so many companions obviously are completely focused on the acquisition and there's probably zero on the retention and they need to sort out what they're doing completely. But how do you agree a focus or a split, in terms of budget, in terms of time, or where do you even start with making some decisions on that?

Alex McEachern:
You're right, it's not a straightforward like, "Oh, just split it down the middle, it should be 50/50." And I remember seeing an Adobe study where they were saying for every dollar put into marketing online, five cents of it was into retention efforts. So maybe there's a starting point, it's 90/5/5, 95 acquisition, 5% retention-

Richard Hill:
Is that because [crosstalk 00:26:01] you can't cancel it? They won't let you, basically? Yeah they say, "Oh, you've missed your cancellation period, see you in 11 months."

Alex McEachern:
Yeah. So there's the one extreme, but I do think that... and you probably see this with the brands you're working with as well, we're talking about ROAS. There's an obsession with customer acquisition, and I would argue that a lot of e-comm is skewing pretty heavily. Maybe not 95/5 but maybe 90/10, 80/20 right now. My answer is it actually depends on how established your business is. Obviously when you're first getting started you can't be 50/50 on acquisition/retention, I don't have an established enough customer base to be doing anything with. But I would say once you cross that, let's call it the million to three million dollar a year threshold, I think that's the point where you should actually start moving it more to 50/50. And as you grow, there's a finite amount of people out there that can buy your product. Eventually, if we just play the mathematics game, eventually there's no more people. You have to be reselling to the people that have already bought from you before. Now, that's an extreme case, but once you get to a certain size, the further you get down that growth trajectory, I would actually argue you want to be going more retention, less acquisition. So when you get to the size of some of the biggest brands that we see on Shopify, they're probably putting 60%, 60 cents for every dollar into customer retention versus acquisition.

Richard Hill:
Then when you think about Amazon, yeah, retention. Sorry... yeah, retention. They're just always pulling you back in, aren't they? Okay-

Alex McEachern:
They're definitely masters of that.

Richard Hill:
Yeah, it's just too good. I have an unfortunate addiction which I'm trying to quash, which is Amazon, but I'm not doing very well at it to be fair. So in terms of brands, the guys that are listening, obviously you work with a lot of independent brands, big brands, a whole mix of brands and obviously there's the big brands out there that neither of us are working with. Who would you say has some of the best retention strategies if some of our listeners wanted to really go and pick at some people that are doing it well and just spy on a few brands that are doing it really, really well, who would you spotlight?

Alex McEachern:
Yeah, there's two brands that I would spy on that you don't necessarily need to be buying something from online but have great retention tactics that you can remix, steal like an artist from. Starbucks, Sephora. Those are two big brands that you can look to and have amazing customer retention tactics. Loyalty programs, the way they operate. If you buy something from Sephora, Sephora's a great... and I know the men listening might not be buying something from Sephora. They've got some-

Richard Hill:
I'm not familiar with that one, actually.

Alex McEachern:
Oh, Sephora, okay. Sephora's a makeup company, US, Canada. I've dug way too deep on their loyalty/VIP program. I think it's one of... if you're looking to study a loyalty program, definitely go look at Sephora in terms of what they're doing. The tiered experiences, when you cross a certain threshold, you get different perks. A lot of them are not sales or physical things but hey, events, "Come and participate in this special event once you pass a threshold."

Richard Hill:
Yeah, yeah, I like that.

Alex McEachern:
And if you go on Twitter or Facebook and search, I think it's the VIB instead of the VIP program, you get people bragging online that they spent $1000 in the last year at Sephora. So how great is that for you as a brand?

Richard Hill:
The mythical black card at Nando's, yeah.

Alex McEachern:
Yeah, so I think Sephora, Starbucks, those are great places to look. There's a Canadian brand, Knix, they sell women's underwear. I think they do a fantastic job at this. If you wanted to buy something or just study what they're doing, the way that they're approaching the pre-purchase experience, setting up the relationship the correct way. If you go to their site they also have a consultant or a concierge to help people find more products, matching products, I bought something in the past, I liked it, what else should I be adding onto that? Those are some of my go-to's, I would go look at that.

Richard Hill:
Yeah, well I know I'm going to look at those. A couple there that I'm not familiar with, so yeah. Great. Well thanks Alex, it's been an absolute blast. It's gone very, very quickly, I think that's been a... there was fantastic takeaways there. I always like to end every episode with a book recommendation. If you could recommend one book to our listeners, what would that be?

Alex McEachern:
One book, everyone in eCommerce, if you want to focus on retention, should pick up the book Never Lose a Customer Again. It's by Joey Coleman. It's a fantastic read. It goes over basically how to build a strategy to keep customers loyal, and his argument is that the first 100 days are crucial. So he gives you a framework that you can take for your brand to be like, "How do I get people engaged and coming back within those first 100 days?"

Richard Hill:
Yep, love it, love it. That's two clicks away, after we've finished. Okay, so the guys that are listening want to find out more about you Alex, what's the best place to do that and best way to do that?

Alex McEachern:
Yeah, I'm pretty active on LinkedIn, so if anyone wants to follow along there. I also have an eCommerce podcast, it's called The Exchange. We cover only customer experience and retention topics, so if people want to learn a bit more about retention as a tactic, come follow along on the podcast there.

Richard Hill:
Yeah. Well thanks Alex, thank you so much and I look forward to catching up again soon. Thank you.

Alex McEachern:
Thanks for having me, it was fun.

Richard Hill:
Thank you for listening to the eCom@One eCommerce podcast. If you enjoyed today's show, please hit subscribe and don't forget to sign up to our eCommerce newsletter and leave us a review on iTunes. This podcast has been brought to you by our team here at eComOne, the eCommerce marketing agency.

Accelerate Your Online Growth With SEO, PPC, Digital PR and CVO Accelerate Your Online Growth With SEO, PPC, Digital PR and CVO