Existing customers are the foundation of growth. They’re the most predictable, most stable, most profitable source of ongoing revenue.
Unfortunately, many brands treat retention like an afterthought.
Especially email marketing.
I get it. Before joining Common Thread Collective (CTC) as a Retention Strategist, I worked for almost a decade as an in-house email marketer. I’ve seen automating flows, building lists, and accelerating LTV get lost amid day-to-day demands.
If that’s you, this big fat article isn’t supposed to be a guilt trip. It’s a way forward — a behind-the-scenes look at how we structure our retention services with one goal … to help you make more money.
Together, let’s fix five email marketing mistakes:
- Disconnecting LTV from Profit
- Forgetting Email Is Conversational
- Losing an Industry-Wide Perspective
- Slacking on Email Capture & List Building
- Lacking the Time & Resources to Make It Work
1. Disconnecting ‘Lifetime’ Value from Profit
Calling existing customers the foundation of growth isn’t lip service.
For clients — as well as the brands we own and operate — CTC forecasts demand in three “layers” of revenue, moving from most volatile (top) to most reliable (bottom):
- Top: Paid Acquisition
- Middle: Owned Audiences
- Bottom: Retained Customers
Different channels power each layer. But they’re deeply interconnected.
Your ability to front the highest customer acquisition costs (CAC) at the top layer depends on maximizing LTV at the middle and bottom layers.
Why? Because CAC has exploded and the industry is flooded with competition. Facebook’s cost to advertise (average CPM) is up 50.58%. Google’s average CPC, 39.81%.
Unfortunately, the “lifetime” in customer lifetime value (LTV) is a slippery metric. You need cash now. That’s why we use a time-bound version called cash multiplier (CM): 60-day LTV.
Connecting LTV to profit means aiming for a 30% increase in the first 60 days and 100% in the first year.
The higher your cash multiplier at both points, the better your marketing efficiency rating (MER) — total revenue divided by total spend. The higher your MER, the lower first-purchase ROAS you can afford to target.
Translation: If your customers spend more money over time … you can spend more to acquire them.
That’s not theoretical bullshit!
Bambu Earth, the clean skincare brand we operate, is able to grow profitably even with a less than 1.0 ROAS on Facebook. How? It has a 60-day LTV of +47.5% and one-year LTV of +107.7%.
Every new customer is worth $40 more in incremental revenue within two months. Then, $91 more within a year.
Take a CTC client whose cash multiplier was ~15% at the time of contracting.
The first thing our retention team did was dig into three metrics:
- Repurchase windows for the time lag between orders
- First purchase products with the highest additional orders
- Popular or complementary products shared by first order and beyond
Knowing when and what customers return to buy shaped an entirely new post-purchase workflow.
It pressed hard into the first 30-day window when customers naturally re-entered the consideration phase. It emphasized SKUs that weren’t just purchased together but purchased in subsequent orders. It featured a downsell subscription offering. And it spoke to satisfaction issues for products with high return rates.
From a 15.39% cash multiplier last year to 43.83% this year. In real dollars, from $7.16 to $17.98 per new customer within the first 60-days of purchase.
To fully connect LTV to profits, you also need to integrate email as a channel with your other marketing channels. Email can’t operate in a silo and still effectively improve every layer of revenue.
At CTC, we use Growth Maps — day-by-day forecasts of email with revenue expectations attached to each one. These email forecasts roll up into larger forecasts for all marketing revenue that month.
Even better, Growth Maps allow our buyers to raise or lower paid budgets based on the actualized revenue email generates. Or, doesn’t generate.
The Growth Map makes it a lot easier to rev up email revenue when the paid team needs it. What emails are going out this month? Where can we step up the offer? When should we add a resend?
Because we track automated sends in them as well, I make educated decisions on what workflows are a priority to optimize or add into the mix in order to boost revenue.
2. Forgetting Email Is Fundamentally Conversational
Email is meant to be a conversational platform. ESPs have powerful segmentation abilities that enable you to speak directly to specific people with specific problems shown through specific actions.
And yet so many brands treat email programs like a bullhorn. Or worse, a sledgehammer.
More than once in my career I’ve been told it’s better to send everything to everyone in case you get an extra sale or two — regardless of how that affects engagement (and deliverability).
Ultimately, pursuing every sale possible with the least work possible results in the loss of many sales.
Instead, treat email as if you are speaking directly to a single person.
Email offers two key ways to get conversational:
- Automated flows sent to specific contacts based on behavior, timing, and event triggers
- Campaign blasts that can be sent at any time to any audience of your choosing
With automated flows, you can enter conversations customers are already having with your brand. If they abandon their cart, imagine what you’d say to an actual person who picked up, examined, and then walked away from a product in the middle of your store.
You’d ask them what went wrong and offer to fix it. You wouldn’t just show them their cart again and hope for the best.
Below, you’ll see the fifteen flows that should be the backbone of your automations — the conversations a customer wants to have with every brand.
Many of these flows interact closely and can be rolled up into a single flow. Cross-sell emails often end up in post-purchase flows.
Once I’ve taken stock of what a client has live, I use this as a guide for figuring out what needs to be revamped and what needs to be added.
In fact, evaluating automations is a clutch part of our usual email audits …
Where automated flows allow you to respond to an ongoing conversation, campaign blasts allow you to start one yourself.
When you’re creating your content calendar, take time to imagine what you would say to a browsing customer if you were working on the floor of your brand’s store (real or imagined).
What items would you highlight for them? What upcoming holidays or cultural events? Is there a certain person you’d be highlighting an item for? (That’s how you create segments.)
Enough strategy. How do those campaigns play out?
Over Memorial Day weekend — sending with dog food brand, Get Joy — I decided to address the opening of road-trip season. What food should you bring for Fido on your summer road trips?
For a skincare client, I took inspiration from an ongoing Skinfluencer discussion about how make-up wipes are terrible for your skin.
The email directly called out the discussion and offered one of the brand’s products as a solution — in the same way, I would have had I been speaking to a customer on the brick-and-mortar floor.
You can also get inspired by certain types of customers. I regularly pull different segments for my clients to see how many customers they have who are interested in a certain category, shopping time, and more.
For multitool and light retailer, COAST, I targeted a relatively small audience though engaged audience who’d shown interest in outdoor activities.
With the summer storm season approaching, it made sense to let those customers know COAST offers a wide variety of storm-proof items for outdoor summer adventures.
Plus, campaigns don’t have to be one and done.
Every month, we pepper in multiple emails to previous buyers of certain items with complementary items.
The email below went to one-time buyers of rechargeable products as the data shows that those buyers will typically purchase at least one more rechargeable product.
Whether you’re entering a conversation that’s already taking place (automations) or sparking a new one (campaigns), approach your email program as a way to talk to real people.
3. Losing an Industry-Wide Perspective
When you work in-house, you live, eat, and breathe one brand. You know it better than anyone else.
The downside? You don’t get front-row insight into what’s working for other people, new strategies, or even new technology.
At some point, it’s common for in-house marketers to throw their hands up, say “good enough,” and stop developing their skills. When that happens, your email program stagnates further.
(This one is usually on the higher-ups. It’s demoralizing to be told over and over there’s no budget for you to attend new training or get free certifications on your own time.)
Every time you say, “I’ll fix this eventually,” opportunities get missed.
I’m biased. Incredibly so! Still, working with a digital agency has an edge.
We’re in and out of multiple brands every day. We get a chance to see what works and why. We’re able to compare strategies and data — so much ecommerce data — with our coworkers and learn even more.
When you’re on top of the very latest that’s going on for email as a channel, you get the most out of the channel at all times.
In-house and alone, that’s a real struggle. You have to actively search out that information: trawling blogs, attending webinars, and reading books. It’s tough, but staying on top of the trends keeps your brand on the cutting edge.
How does an industry-wide view take shape?
I’ll keep this one short with two of my favorite examples.
First, when I noticed how well UGC photos were performing in emails for the dog food brand I worked on, I decided to try them over in a skincare brand’s emails.
It was an instant engagement success.
Second, last April, one of my colleagues received an email asking if she wanted to opt out of Mother’s Day promotions, given that 2021 is following an extremely bad year for many people and their parents.
She immediately passed this idea on to the whole team so that many of us were able to run similar campaigns for our clients, helping them meet the sensitivity of the post-pandemic moment.
We regularly have moments like this where we sit down and swap learnings from our efforts.
Ultimately, as an agency team, this is really easy for us. All I have to do is throw a question in Slack and I’ll have a dozen new ideas, opinions, and data points to work with and educate my client with.
4. Slacking on Email Capture & List Building
You can’t have an email marketing program if you don’t have anyone to email. As a result, your capture programs are paramount. You need to be gathering prospects to nurture into customers as well as customers to nurture into long-term loyalty.
If neglected … list growth totally stalls.
It also means you’re foregoing a lot of valuable chances to introduce your brand to a consumer in a personalized way, on the channels they’re already on. Your email program will be completely left out of converting first-time buyers at all.
Instead, implement a variety of capture tactics.
You should be running capture programs all across your site. I shouldn’t need to say this but people still forget:
Every program should be formatted to appear on both mobile and desktop unless it is specifically targeted at one audience or the other.
A good capture program provides some type of boon in return for the visitor’s email address (and often phone number). These programs come in a wide variety of formats and placements.
Generally speaking, all ecommerce sites should have at least one broad capture program that’s live across the site.
Typically this comes in the form of a pop-up offering some type of incentive for a visitor to sign up for your email (and SMS) list. The pop-up will appear on the page the visitor lands at after a certain amount of time and provides an impersonal offer like a % off your purchase.
The average conversion rate for this type of pop-up is about 5.56%, though a well-optimized one can do closer to 10 or even 11%. A site getting 1,000 hits per day should be adding 90-300 new contacts to its database daily.
Once your general site capture is in place, you should experiment with tactics that are more personalized or more specific to a page. Exactly what tactics will work for you depends completely on your brand.
There is a myriad of ways to capture subscribers and these days you’re really limited only by creativity.
Seriously, my colleague Cassidy put together 45 examples of just pop-ups here along with a 17-point checklist ⤵️
45 examples and 17 questions is a lot. So, I just want to call attention to a few of my favorites …
An absolutely killer example of a specific capture program that targets a customer’s curiosity is Bambu Earth’s skin quiz.
It’s a clever form because not only does it capture a contact’s basic information, it also captures highly specific properties about skin types and concerns.
And it works because it offers the contact something directly related to those questions: how to fix those skin concerns.
While this approach may seem specific to skincare, you can roll out a multi-step form for any brand. It’s about creating a conversational flow that addresses the exact reason the contact has landed on that page in the first place.
You can also create pop-ups that respond to specific behaviors — the most famous of which is exit-intent. In addition to the general pop-up above, Misen responds to those about to leave by offering to enroll them in a contest.
Get Joy’s popup stacks multiple offers into one: 30% off your first two orders and then 10% off “thereafter.”
Bobbie takes a similar tack with a free can of organic infant formula plus a $26 coupon. Better, it adds a touch of personalization by asking for your baby’s birth or due date.
COAST, on the other hand, goes for a straight 20% off discount but also immediately asks for phone numbers in exchange to “save even more” and puts an invitation to its rewards program across desktop as well as mobile in the bottom right corner.
A powerful one-two-three retention combination!
Though they sometimes get a bad rap, spin-to-win popups regularly convert at double the rate of their non-interactive counterparts. More so when they’re stylized and branded.
Last though not least, don’t forget about your footer; both for email addresses and phone numbers.
Once you’ve got these pop-ups ready, you should make sure that all your follow-up communication is tailored to the experience.
You may not need to completely reinvent the wheel for every form, but no matter what, you want to make sure the follow-up method makes sense.
Finally, make sure that when you’re tracking the success of your capture tactics, you’re not just looking at the sheer volume of subscribers.
Track total revenue and LTV from the subscribers who came through each form. You may find that one only gets 10 subscribers a month, but each of those subscribers goes on to make a massive purchase.
If you notice that, you can use that data to figure out how to roll that kind of program out in more locations.
Again, Cassidy dove into the specifics of how to do all of this over here.
5. Lacking the Time & Resources to Make It Work
Our final mistake is the toughest. It also infects all the others problems.
Time and resources! Wearing multiple hats leads to accepting the status quo. “At least there’s a welcome flow live, even if it doesn’t adhere to our current branding.”
Without iterating, learning from your results, and keeping up with the latest industry information, optimization falls off. Emails become stale. Once vibrant programs, die.
Each visitor is a chance to convert into a contact. Each contact is a chance to demonstrate your A-level conversation skills, to prove right from the get-go that your brand is worth their time and money.
Every visitor who gets missed because your capture strategy is sub-pare and every contact who receives one lackluster welcome email …
You’re not missing out on one sale; you’re missing out the next sale, the next, and the next.
Sound like you? Good news! You have options.
Getting dedicated experts (like us here at CTC) on your email program can help you achieve all those dreams you’ve had on the backburner.
If you want to know exactly what we’d suggest for your email program, grab this article as PDF and simply select “Email and SMS” in the last dropdown.
One of our retention strategists will do a deep dive into your program and surface with the opportunities your brand has to achieve your retention dreams.
Who knows … it might even be me, Cara 👋
Cara Wood is a Retention Strategist at Common Thread Collective. She’s been in email marketing for nearly a decade. When she isn’t jamming on new retention strategies for ecommerce brands, she can be found trying to keep her beagle out of the trash. Connect with her on Twitter.