The TL;DR:

• Let’s Chat D2C: Is surprise and delight the most impactful way to improve retention and LTV? My case against it.

• What I’m Thinking about this Week: The Ostrich Effect and how you can work around customers’ desire to avoid negative information.

• The D2Z Podcast: In this week’s episode, I sat down with Bryan Alston, Co-Founder at Brand Castle Growth, scaling emerging brands into market leaders.

• App Updates: Klaviyo November Product Updates, including using AI to segment and a new and improved flow builder interface.

• Upcoming Events: I’m in Miami for the rest of the year! In the new year, DRINKS has been selected to have a booth in NRF’s Innovation Lab in NYC from 1/13 to 1/17.

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Let’s Chat D2C - Does Surprise and Delight work? My Case Against it.

I often hear “surprise and delight” touted over and over again as some magic that brands must employ to improve their customer retention, but does it actually work?

Kind of.

But I think brands are leaving a lot on the table by employing this strategy versus what I prefer.

I’m still working on a better term for this, but for now, we will call it Communicate and Delight.

Let’s say you send all of your repeat customers something special in their second order, but you don’t tell them about it; you are employing the “surprise and delight” strategy.

But why would you NOT tell your first-time customers that they will receive something AWESOME in their second order? Don’t you think that would increase the % of customers who come back and place a second order?

You’re already investing in including something special in customers' second orders. Use this to get your first-time customers to come back and reorder again.

Communicate to customers on your website, in your transactional emails and texts, in your post-purchase flows, and throughout the rest of the customer journey what they should expect to receive if they place a second order!

See how that impacts your repeat purchase rate 😉

What I’m Thinking About This Week - The Ostrich Effect in Ecommerce

Coined in 2003, the Ostrich Effect was first observed by researchers Dan Galai and Orly Sade when studying the behaviors of investors in financial markets. It’s the avoidance of negative information due to the belief that doing so means it’ll go away on its own.

This phenomenon extends beyond financial situations…. healthcare, weight loss, climate change, family relationships, etc. etc.

It’s the classic “it’ll go away if I don’t pay attention to it” mindset.

So, knowing this is going on in your buyer’s mind, that they want to avoid negative situations, how can we reframe topics and conversations to make prospective customers feel comfortable with taking the leap to buy?

Humor

Lighten the mood and kill the ostrich effect.

Gamification

Your customers already know they should be purchasing from you, but how can you help them along? Gamification. Show their progress towards purchase on the website, and in getting them to come back and reorder, set up tiers and goals that they can achieve.

Outline Product Benefits Clearly

Don’t leave customers searching for what your product will do for them. Make it clear and put why your product solves a problem front and center and doesn’t create one for them.

But avoid hot-button words. If you are targeting customers on a diet, don’t put the word diet all in their face; instead, emphasize how low-calorie the product is.

Customer Examples

UGC and customer success stories are critical here.

Do NOT Overwhelm

Those 45 pop-ups on your website, 100 different animations, and 1000 different shiny objects? Simplify! You’re going to overwhelm your prospective customers.

Emphasize Easy Checkout Methods

1-click to buy? Yes, please.

This Week’s The D2Z Podcast

#86 – Customer-Centric Branding with Bryan Alston

🎧 Listen Now 🎧

In this week’s episode, I sat down with Bryan Alston, Co-Founder at Brand Castle Growth, scaling emerging brands into market leaders. Specifically, we explored the following:

💰 His 12 years of experience in launching and scaling e-commerce startups and the shift towards building long-term customer relationships.

📲 The impact of privacy updates on attribution.

😎 Starting locally, building a community, and growing slowly and sustainably versus growing at all costs.

🚀 Tips for 2024, including exploring Reddit as an advertising channel and considering alternative channels for brick-and-mortar expansion.

App Updates - Klaviyo November Updates

Use AI to Segment Right on Target

Now, you can use chatGPT-style prompts to build segments within Klaviyo. When you create a new segment, you’ll now see a Define with AI button.

Type out a sentence or phrase that describes the people you’d like to target. For example:

• People who have opened an email or clicked an SMS in the last 30 days

• People who have opted into email marketing, have not subscribed to SMS marketing, and purchased two times or more

• People who have ordered five times or more but are not active Recharge subscribers

Klaviyo will show you a preview of the segment so you can see how it looks before proceeding, and then you’ll have it created for you in seconds. From there, you can modify the segment in the standard way if there are any changes you want or need to make.

This is a really neat feature, but it is still reliant upon us, the users, defining the audience and communication type they should receive, versus Klaviyo telling us, “Hey, this cohort should receive this message via this channel at this time.”

Reply to Reviews Faster with AI

Automatically draft replies to customer reviews with AI.

New Automated Flows Experience

The workhorse behind Klaviyo’s personalized customer journeys just got a modern, intuitive facelift, including:

• A new way to navigate: Use the new minimap and navigation toolbar to help you quickly find what you’re looking for or easily pan around the canvas using only your cursor.

• Improved drag-and-drop functionality: Quickly and easily add custom elements into your flow with our new, intuitive drag-and-drop menu

• A flow configuration side panel:  Customize your flow settings, see message previews, create A / B tests, view performance, and more, all without leaving the flow builder

• Better visibility into who enters a flow: Try the Trigger Setup Preview tool to see the last ten profiles who qualified for your flow, with reasons for why they entered the flow. Plus, search for a specific profile to see whether they met the flow’s conditions.

You can toggle on the new flow experience to try it.

Increase Customer Lifetime Value with Klaviyo and PAR® Punchh®

I won’t dive too deeply into this, as there are zero subscribers to this newsletter who operate a large restaurant chain. Still, this integration shows how Klaviyo continues to invest in penetrating the restaurant industry after it’s integration with Square.

AI Review Headlines are Here

Klaviyo will suggest a few review headlines to reviewers based on the copy of their review.

Upcoming Events

I’m in Miami for the rest of the year! In the new year, DRINKS has been selected to have a booth in NRF’s Innovation Lab in NYC from 1/13 to 1/17.

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