How to Learn About Your Customers

Hi Retention Kings and Queens,

We are at newsie #39.

It’s been almost a full ten months doing this thing.

This level of consistency is so out of the ordinary for me, and I am so happy I stuck with it.

Building a community around CX and Retention seemed so outlandish when I started out in DTC back in 2016.

When I started talking about this stuff in 2020, I was sure it would fall completely flat.

After all, “growth guys” were what DTC Twitter was known for; who was interested in hearing about CX or Customer Retention?

Boy, was I wrong. This week, I hit 20,000 followers on Twitter, the CX discord has more than 700 CX’ers, and this newsletter has taken off beyond my wildest imagination.

I am beyond thankful for each and every one of you. 💛

In this newsie, we'll dive into the importance of understanding the customer journey, the power of leveraging customer data, and practical steps for implementing customer feedback to improve customer retention.

• The Customer Journey: A Core Aspect of Retention

• Data Deep Dive: Where to Learn about your Customers

• Practical and Tactical: Using Data to Improve Retention

This newsletter is brought to you by Tapcart.

If you missed the title of the newsie, we’re gathered here today to talk retention. In my opinion, one of the easiest ways to drive serious scalable retention is by adding a mobile app to your marketing mix.

The results are high impact and low effort on your end. A marketer’s dream right?

I keep seeing more brands hop on this train, and I want to make sure you’re not sleeping on it, so here are the cliff notes:

​​How does a mobile app make a retention strategy stronger and customers stickier?

App users have proven they’re more die-hard fans, with higher conversion rates, revenue per session, and lifetime value than mobile and desktop web.

With an elevated mobile shopping experience and push notifications, your customers will feel special, won’t churn, spend more, and stay forever.

Your biggest fans will almost always download your app, and that top 10-30% of consumers is worth 6X your regular customer cohort. Tapcart makes it easy for any brand to build an elevated for your community and grow revenue.

Maybe you’re thinking that an app might not be necessary, and that it seems like a hassle to manage, or you just don’t have time to set it up. Let me bust those myths really quickly.

1. Brands using Tapcart see a 43x Return on App Spend.

2. The app can also help you save on retargeting ad spend because you can reach your customers directly on their phones in a snazzy push.

3. The app syncs with your Shopify store so you can launch it literally in two weeks

4. Managing the app is so easy an intern can do it

It’s low-hanging fruit.

Launch your own app with a killer marketing strategy in less than two weeks AND get your first month free on me using the link here: www.tapcart.com/eli.

In last week’s newsletter, we chatted about the transition from old-school retention to new-age retention and the process of building out your first post-purchase email. This week, we are talking a bit more holistically.

The Customer Journey: A Core Aspect of Retention

Take a closer look at your company and the startups around you. When did they hire the first retention role?

For most brands, retention is an afterthought. When they squeeze all the juice on the growth side and want more cash from the customers they acquired, they call in the retention saviors to fix their churn.

That hire comes in and works to put together a solid email and sms plan, and then reports on select numbers they think look good. The CEO pats himself on the back and considers it a success.

Let’s zoom out for a second. Retention, at its core, is having customers come back. It’s answering a simple question: How many of the new customers you brought in made it to order #2?

However, to truly have a successful retention strategy, it’s important to understand the customer journey and the various touch points throughout their experience with your brand.

The customer journey is a map of the steps a customer takes before, during, and after their purchase.

Understanding this journey allows you to identify pain points, areas for improvement, and opportunities to engage with your customers and keep them coming back.

After they purchase product A, do they usually return and purchase product A again, or do they opt for product B?

Is there one journey that’s better than the other, or a path more commonly taken?

I’m sure you have been through a journey with a brand where you buy something and get pitched on multiple different products, as well as a pitch to replenish the product you just purchased, all within the span of a few days.

I’m equally sure that doesn’t really work for most of you.

Data Deep Dive: Where to Learn about your Customers

There are so many ways to learn about your customers and better understand how they interact with your brand, but let’s keep it practical and straightforward.

Let’s discuss the various data sources that can provide insight into customer behavior and how analyzing this data can help you identify areas for improvement and better retention.

Product Analytics:

Most data analytics platforms will give you customer journey data to jump off and start working with. We use Peel at JRB, and they have three really solid metrics I love looking at:

1. Customer Purchase Journey: See what your customers purchase when they return and buy again, split by order number. Identify the most popular journeys, and then get a better understanding of the LTV of these journeys, etc.

2. Market Basket Analysis: See products most frequently purchased together, the volume of each different group of products, and split by new orders vs. returning

3. Top Products by Order Number: The top products by quantity purchased within the customer's first, second, third, etc.

Action: Skip deciding on the ideal customer journey based on “vibes,” and instead, let the data guide you.

Return Reasons:

When trying to figure out why customers do not love a product, it’s important to look at the reasons they are returning.

Important tips for collecting impactful data:

1. Have impactful customer conversations to understand top return reasons vs. keeping the generic ones set up in the portal you are using

2. Always leave an “other” option so that customers can go off script and leave more qualitative feedback

3. Create parent and child reasons that are both informative and actionable

   • Pants: Parent reason - It did not fit me >> Child reasons: too small, too big. etc.. >> Action: if the majority of folks mention it’s too small, add a line to the product description mentioning it runs small

   • Moisturizer: Parent reason: I disliked how this moisturizer feels on my skin >> child reasons: too sticky, too heavy, etc. >> Action: educate in a post-purchase email around proper product usage (“start with a small amount, you can always add more”)

4. Pull monthly reports around top return reasons by product, return percentage by product, and revenue return rate. Make sure you understand what your returns are telling you. Sometimes it’s an education issue, sometimes it’s a product issue. We use Loop as our return portal and I can’t recommend it highly enough.

Website Reviews:

Website reviews can provide valuable insight into customer experience and can help identify areas for improvement in your product and customer journey. These reviews often touch on common pain points and provide qualitative feedback that can be difficult to obtain from other data sources.

Action: Collect data by marking down how many times you see the same feedback, both negative and positive.

Respond to negative reviews and address their concerns to show customers that you value their opinions and are committed to improving their experience with your brand.

Consider implementing changes based on customer feedback to increase customer satisfaction and improve retention. Be wary of signal vs. noise. Not everyone is your ideal customer. (Proof: people hate Apple and love Android 🙃.)

Customer Surveys:

Product surveys can be a powerful tool to gather specific information about customer experiences and preferences.

These surveys can be used to gather data on customer preferences, product usage, and customer satisfaction.

Reach out to your superfans, your one-and-done customers, and maybe even your run-of-the-mill ones.

Get an idea of what people love, hate, and what is exactly as expected.
No need to get super fancy; you can go with a Typeform survey.

We chatted about this last week as well, so I won’t go too deep on this.

Ensure that the surveys are well-crafted, short, and to the point, and offer a gift card, etc., to increase response rates.

Action: Use product surveys to gather customer feedback and make data-driven decisions to improve product and customer experience.

Use the data from surveys to improve your products and customer journey to increase customer satisfaction and retention.

Surveys (NPS edition):

If I had a dollar for every time someone said, “NPS is useless; it gives you no actionable data,” I’d be retired on a beach in French Polynesia eating organic blackberries.

Here’s the problem: you are not thinking about NPS correctly.

Just asking, “How likely are you to refer a friend” is not enough. You need to ask secondary questions.

Attaching some screenshots for examples of a secondary question we ask to get more color. All of this is built on Retently, the survey tool we use.

The final message is also different based on if you are a promoter vs. a passive or detractor.

Action: Ask clarifying questions, and pull customer profiles, tags, etc. from Shopify so you can segment NPS scores by behaviors.

E.g., the folks that go through our concierge shade-match squad have a dramatically higher NPS score than standard customers do.

They also have a higher LTV. This helped us decide to push more folks through that funnel, even if it is a costly endeavor.

Search specific words or phrases to see the number of times they came up, either negatively or positively.

Oh, and it’s obviously a playground for qualitative data mining.

This is all related to NPS, but the same goes for any other survey you run, like CES, CSAT, etc.

All of these are great places to learn about your customers.

Customer Quizzes:

Depending on your brand and product assortment, customer quizzes might be a perfect way to learn about your customer's needs from their own mouths.

All JRB paid traffic goes to a quiz, all these quizzes are built on Octane by the quiz genius Joanne Coffey.

Take a peek at our quiz to get a better idea of how this all works. In our case, we learn about a customer’s skin shade, skin conditions, skin type, products they are considering, and so much more.

Action: Using this zero-party data, we can cultivate a thoughtful experience that talks directly to them.

Knowing what they are looking for and what would be well-suited for them helps us do a better job of getting them to purchase and repurchase.

It’s a no-brainer.

Practical and Tactical: Using Data to Improve Retention

Now that you have several different ways to pull customer data, here are some practical next steps:

Understand what is fixable:

Once you have the quantitative and qualitative feedback, it’s important to understand what is fixable and what isn’t. Not every single human in the world is your customer, and that’s okay.

Example: if you are selling green juice and folks reach out saying they hate anything green, this product is probably not for them. That being said, it’s still worth keeping them in your Rolodex in case you launch something not-green in the future.

Low Lift, High Impact:

Try first to find the lowest impact and highest value optimizations you can make, especially if you are a lean team without a ton of extra bandwidth.

Example: If you are having a ton of complaints around a product issue that is clearly due to it being used incorrectly, you can do something as simple as a plain-text email immediately after purchase or post-delivery explaining how to use it correctly.

Something as simple as that can easily unlock increased retention with next-to-zero effort.

Complaints are the loudest:

Imagine you are running a snack brand. You launch and sell 10,000 units in the first 30 days.

Your retention is above average and you see 60-70% of folks buying again in the 90 days after launch.

You pull in a retention person to “figure out why a full 30-40% of customers did not repurchase (!)”.

They pull together a bunch of different complaints, and the most common one is that the product is too sweet.

50 people complained about this. It’s the #1 complaint!

Before you run to your production partner to switch the recipe, understand this:

Complaints are the loudest, but repeat purchase behavior should ring louder.

Two things are true about customer feedback:

1. For every complaint, a few people usually feel that way but won’t reach out (unless it’s objectively outlandish).

2. Angry people are the loudest, while happy customers rarely provide any feedback at all.

That's it for this week!

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

Just shoot me a DM or an email!

See you next week,

Eli 💛

^{*Disclosure: I might get an affiliate commission if you click on some of the links in this newsletter and choose them for your business. That being said, these are tools I personally use and love, and I would not recommend them if I did not think you would love them too!}