A Conversation with BaubleBar: Holiday E-commerce Marketing

Becca Freeman, Senior Manager, Digital Marketing at BaubleBar

 

We recently hosted a webinar with Becca Freeman, Senior Manager, Digital Marketing at BaubleBar. Launched in 2011, BaubleBar has quickly become an online destination for fashion jewelry, due largely in part to their unique sourcing capabilities. BaubleBar leverages real-time data to design products corresponding to current consumer trends.

Becca manages BaubleBar’s customer acquisition and email marketing programs. She talked to us about BaubleBar’s use of data and customer insights, as well as their upcoming holiday strategy. Here are a few highlights – you can get the entire recording below.

(We’re also hosting another webinar this week, discussing data-driven email marketing techniques from top retailers like Guess?, Nasty Gal, and Sole Society – register here).

 

We’re a 100% data-driven company across all business functions.

Being data-driven is a competitive advantage.
“As a startup, we work with a startup budget, and we don’t spend a dollar that we can’t back up from an investment perspective”. Becca’s words should ring true to all marketers, even those who work for established retailers with large marketing budgets.
Specifically, Becca and team are leveraging data insights to optimize BaubleBar’s customer acquisition: “We look at CPA (Cost Per Acquisition) by marketing channel to see which channels might cost more but drive higher value customers; vs. other channels where we’re not willing to spend as much as they mainly bring ‘one and done’ customers, or customers that are going to come back and be discount-driven.”

During the holiday timeframe, competition for new customers increases and acquisition becomes more expensive. Thus, it’s more important than ever to closely examine not only CPA, but CLV (Customer Lifetime Value) and ultimately the ROI of each marketing channel. This Custora U course talks about optimizing paid customer acquisition (specifically SEM and affiliate marketing) for customer lifetime value.

 

 

People don’t just wake up on our email list.

Executed right, social media can drive meaningful returns for e-commerce marketers.
The Custora E-Commerce Pulse, Custora’s free dashboard of US e-commerce stats, shows that the top marketing channels driving e-commerce purchases are online search (free and paid), and email marketing. Together, these channels drove 60% of e-commerce orders in September 2014, with similar figures for 2014 to date. Social media, on the other hand (including Facebook, Twitter, Instagram, and Pinterest), drove only 2% of online sales. What gives?

“Email and search are very important to us, but we also recognize that a lot of customers don’t discover us through these channels. Somebody doesn’t wake up in the morning, all of a sudden gets a lightning bolt to the brain, and says ‘let me google BaubleBar’. Likewise, people don’t just wake up on our email list. So while search and email are valuable bottom-of-the-funnel channels, we see social driving a lot of sales on a top-of-the-funnel basis.

“Facebook has changed its algorithms to de-prioritize organic brand content, but we have seen a lot of success with paid social content, especially because we have such a visual product. We see that the newsfeed is a really good medium for us to reach new people.”

Paramount to the success of BaubleBar’s Facebook advertising is their deep knowledge of their Facebook customers.

“We found Facebook customers tend to be impulse-driven, and thus when they see something shiny and sparkly, they’re willing to click through and check it out. One of the great things that we found about Facebook customers is that because they’re impulse-driven, they’re quicker to convert. We’re able to see returns more quickly, as opposed to customers coming from some of the other channels who take some nurturing or retargeting to get them to convert.

“We’ve also seen that Facebook customers are super price-sensitive, so we want to hit them with something that is a compelling deal or offer. They’re less interested in our trend-based content compared to other channels like email customers, who are already familiar with us and are looking for the next big trend. Facebook customers are more motivated by things that are within our style, but are also offered at a great price.”
BaubleBar's Facebook campaign

 

We look at Custora as the all-knowing, robotic extension of our email marketing team.

(She called us Robots, so we couldn’t resist)

Email is more important than ever, and customer segmentation is the key to email success.
BaubleBar’s holiday preparation started way before Q4. The team focused on new customer acquisition in Q3 and early Q4, as acquisition costs rise sharply later in the season. (This blog post examines why Q3, and October in particular, is the best time of the year to acquire new customers.)

In Q4, BaubleBar’s focus turns to nurturing and converting new customers, as they shop for themselves and gift others. Email is natural marketing channel for stimulating repeat purchases, and BaubleBar is very thoughtful in crafting its email strategy.

“One of our biggest initiatives for 2014 was to increase personalization and move away from ‘batch & blast’ by leveraging both explicit behavior (customer purchases) and implicit behavior (browse behavior on the site).”

To that end, one email campaign that’s been working particularly well for BaubleBar is its win-back campaign, meant to reduce customer churn and win back lapsing customers. BaubleBar used Custora’s predictive churn detection algorithms to implement this campaign.

“No matter how well we know our customers, it’s really hard to know them individually and know who is about to churn. We look at Custora as the all-knowing, robotic extension of our email marketing team. Custora put churn filters in place, and detected when people are starting to slow down, not necessarily at risk of immediately going away. Then we can offer these customers a discount. We see it as a worthy discount to give out if it’s going to salvage the relationship.

“We put in place a three-email series of people who were ‘fading away,’ orchestrated through Custora, and have seen strong results with this customer-centric approach as opposed to the ‘averages’ approach that we were taking before. Previously we said ‘the average is X months after a purchase before the person was going to go,’ but it’s really much more complex than that. With customers that are buying twice a month, they become at-risk much faster, whereas with some of our holiday shoppers, they’re not necessarily ‘at risk’ if they go two months without shopping. It’s really helped us set the right cadence for ‘fade off’ messages and make sure that nobody’s slipping through the cracks.

“Our marketing program is very testing-driven, and one of my favorite parts of the Custora platform is that it makes it really easy to run a lift study and see what you’re driving, as opposed to trusting that all boats are rising because you’re implementing a certain strategy.”

 

 

We discovered that if we stack purchases at the beginning of their relationship with us, we see a higher lifetime value.

Convert early, convert often.
BaubleBar discovered that getting newly acquired customers to make multiple purchases within 30 days of their first purchase results in higher customer lifetime value. Upon discovering this insight, they crafted a holiday campaign aimed to encourage multiple purchases within a short timeframe.

“Since our price point is very digestible, we see a lot of repeat behavior within the first 30 days of acquiring a customer. During the holidays, when people aren’t just shopping for themselves but for others as well, we’re looking to create opportunities to shop multiple times.

“One of the strategies we’re using is called ’12 days of buried bauble’: Every day at the beginning of December we have a different $10 or $20 product. It’s both a fun scavenger hunt, because it’s like the Deal of the Day, and at the same time it’s creating a nice repeat behavior where people purchase multiple times within their first 30 days with us. We discovered that if we stack purchases at the beginning of their relationship with us, we see a higher lifetime value overall, as opposed to letting them sit back and purchase at their own volition.”

Starting a customer relationship on the right foot by proactively working to increase conversion early in the customer’s lifecycle makes a lot of sense. Here is how Sole Society, another successful online retailer, does it using predictive techniques.
Listen to the complete webinar recording

The webinar recording includes the full interview with Becca, with many gems (yes!) that weren’t covered in this blog post – including BaubleBar’s loyalty program, holiday promotional plan, and holiday gifting strategy.

Fill in the form below to access the recording & deck.

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