I’m still not sure why…

Why is there no education about this one key component of ecommerce marketing? No one in the dropship world seems to speak about it.

All I see is people believing marketing is only about acquisition of new customers.

And yeah, sure, getting new customers is important. But it’s not the most important part.

But what is it?

It’s retention.

>> The ability to keep existing customers coming back.

For years now, retention has been the most discussed topic in the entire ecommerce space. 9-figure brand operators, SaaS vendors, and experts share insights and ideas. Entire companies and agencies have been built on one promise: to help with retention. It’s THAT important.

Why?

It costs 5-7 times more to acquire a new customer than to retain an existing one

Yeah, you read that right. 5-7 times.

Unfortunately, I haven’t seen any education about retention marketing in our space.

Maybe because it’s a difficult topic.

Or maybe because of the (very wrong) perception of marketing.

Or maybe because dropshippers believe if customers find out they’re dropshipping, they won’t come back.

Whatever it is, today I want to share some stuff I truly believe will help you.

Personal Note I do understand that getting new customers is hard. Like really hard. You might even expect me to speak about how to get customers. And I will speak about this at some point. But for now, I want you to learn something new. In fact, I even want you to unlearn some things you’ve probably heard about ecommerce. One of those things is that customer acquisition is the only way to grow a business.

Don’t expect a retention playbook in just one email, though. But I’ll do my best to cover the essentials and tell you how to think about retention.

To make this email practical, I focus on things you can have an actual influence on. No fluff.

There are six pillars to retention:

• Email.
• SMS.
• Loyalty programs.
• Subscriptions.
• Mobile apps.

(In that order)

Your goal is to use these pillars to create experiences which will make customers come back.

How do you do that?

The foundation of all is segmentation; split your customers into SPECIFIC buying-behavior-based groups.

Include product type, product usage, category, seasonality, buying frequency, order value, etc. Everything you believe is useful.

It’s very easy to do with Shopify’s built-in feature “Segments”. No need for advanced segmentation software at this point.

Here’s how the definition of a segment looks if you want to include customers who haven’t ordered recently but used to do so:

Looks complicated? Yes, it does look that way. (At least to me).

In reality, it’s not. Shopify gives you templates and the actual process of defining those segments is very straightforward. You don’t need any advanced knowledge.

But what to do with these segments?

>> Personalized and targeted marketing campaigns.

The goal is to craft customer experiences based on their personal behavior.

A simple example:

If you sell pet products and customer A bought a cat toy and customer B a dog toy, it wouldn’t make any sense to run a promotional campaign for new cat products to customer B. It’s just not relevant.

By using segments, you can differentiate and create an environment for your customers which makes them feel seen.

To do this successfully, you need to come up with campaigns. Contextual relevant campaigns, to be exact.

Let me explain with another example:

At your checkout, you ask an additional question: “what’s your pet’s name?”.

In your next campaign you can run a promotion for a personalized cat collar:

A simple SMS/email/push notification with: “Will this look cute on [cat name]?” will work wonders.

You’ll end up with a customized and relevant offer. Way easier (and way more profitable) than trying to lure in new folks who haven’t heard about you.

Does this mean you can forget about acquisition? Not at all, but I don’t want you to only focus on this. The gold is in retention, not acquisition.

But all of this is kinda useless if you use a legacy tech stack. You need apps and software that can speak to each other, aka. integrate.

If your email tool doesn’t know what your SMS tool does and your loyalty tool doesn’t know what your subscription tool does you’re screwed. Or at least not as profitable as you could be.

That’s also the reason why some Shopify app companies turned into massive platforms that combine all.

Like Yotpo; they used to be a product reviews app. And now they have reviews, email, sms, loyalty, and subscriptions. All in one.

Or like Klaviyo; they used to be an email marketing app. And now they have email, sms, and reviews. And their biggest strength is advanced segmentation.

I could speak for hours about retention. But I’ll leave you with what we have so far. It’s already a lot.

But please let me add a few more words here:

Start with your goal and work backwards.

• What product do you want to sell? (eg. cat collar)
• Who is most likely to buy it? (cat product customers)
• How do I reach only high-intent customers? (segmentation)
• How can you make it more personal? (personalization)
• What’s required for personalization? (more data points; question at checkout)
• How can you spread the word? (personalized messaging with pet’s name)
• What channels can you use? (SMS + email)
• What tools are available to help?

And so on.

By doing the hard work of real marketing and answering these (and probably more) questions, you will be in a fantastic spot to sell more at a higher price.

I hope you enjoyed this newsletter. Maybe you learned something.

See you next week :)

Tim

P.S.: I need a name for this newsletter, any idea? Reply to this email.