jess chan podcast

What's up, DTC Pod? Today we're joined by Jess Chan, who is the founder and CEO at Longplay and Backbone. So Jess, I'll let you kick us off. Why don't you tell us a little bit about yourself, your background, and what you're building at Longplay and Backbone.

Thanks for having me, Blaine. I'm so excited to chat about all things retention in D to C. So quick background. Longplay is a full service retention marketing agency for D to C ecom Brands. We've been around for four and a half, five years now. We've worked with brands anywhere from pre revenue up to 500 million in annual revenue. Brands upscaled two, three x within 18 months and just across all the different verticals. So very well versed and experienced in all things retention in ecom.

Backbone is our email strategy automation tool. So we essentially took all the work that we were doing, we were doing email and SMS marketing for brands, turned all that strategy into algorithms, and turned those algorithms into software. So that's our most recent kind of software tool launch that we started earlier this year. And before all of this, I was the in house CMO at a brand called Bestsoft Co. And that was kind of how I got my start in the e commerce world and got introduced.

To all of well, yeah, and maybe that's a good place for us to start. And one of the reasons we were really excited to have you on the show today was because you've been doing retention as it pertains to direct to consumer ecommerce for a long time now. And obviously there's been a lot of focus on performance. Traditionally in D to C, things are moving towards retention. This is something that has been going on in SaaS and other industries for a while where you really focus on the customer journey and the data and the touch points and what's going on. But as it pertained to ecommerce, it wasn't really as prevalent because A, the tools weren't there, the performance was so easy to come by and you didn't need that level of optimization. But as we've been seeing retention optimization is all stuff that's really important in considering the whole customer's lifecycle and how they interact with your product. So why don't you take us back a little bit to your first foray into it, how'd you get started, what you start coming up with, and yeah, just give us a little background on that.

Yeah, I'm personally just excited that people want to talk about retention now because I feel like I've been talking about it for years and no one cared and now it's like, yay, we're the cool kid in school. So it's amazing to see the industry kind of maturing. And when I first started in the ecom space, I started as a marketing assistant at bestselfco and then eventually became the CMO. And this was back in, I think it was like 2015, 1617 ish. And I think back then it's like we didn't realize how good we had it as an industry. Everything we touched turned to gold. You could run a few Facebook ads. You always had great ROAS and acquisition.

Like you said, it was so easy to come by, it was so easy to acquire new customers. It didn't actually make any financial sense to spend too much time on keeping customers when it was so easy to grow purely through acquisition. So that was kind of, I think, what set the stage with how most ecommerce brands think about acquisition versus retention marketing and how they think about marketing in general. And even now, we still see a lot of brands who think like, hey, just one great ad creative is going to crack the growth, or we just need one ad to go great, or let's just optimize this one channel. And that's just not the reality of the industry that we're living in anymore. I think over the last few years we had a lot of heydays as the industry. We had the initial time period until 2018, 2019, when everything just kind of worked from an acquisition standpoint. Then it started getting a little bit tougher, but then COVID hit and then we had a little uptick there as well.

And I think it covered up a lot of the changes that were happening underneath the industry. And then when it all kind of slowly started melting away, that's when you started seeing more of those conversations around like, oh my gosh, e commerce is going, like everything is messed up. We're seeing a lot of these e comm brands who know Casper and all birds going down and we think the industry is going down. I think actually what happened was it was actually just very inflated and right now all that's happening is it's maturing as an industry. We're being pushed to apply and develop more sophisticated and solid foundations as a business model in terms of finding product market fit, understanding your audience, having acquisition strategies, but also having retention strategies. And how do you actually methodically grow a business? How do you do it sustainably and scalably? All these are like questions and approaches to business that you always needed going into any other industry. But we had it really easy for a few years in ecom. So that's kind of where the conversation with retention has really started for us.

Back when I was at Bestseller, we always made a ton of revenue through email marketing. And I think I always say, I feel so lucky that that was the first foray into ecommerce because we were selling journals and card decks and kind of notepads and they were amazing products, amazing brand, amazing community, but there was absolutely no moat around those products. We were literally selling the lead magnet of like a printable version of the journal for free. So the only thing that you really had was marketing and storytelling and really understanding your customer mindset because when they can just get the product for free, like, what else is there? Even though the product is amazing. So I think that kind of really set the stage in terms of how do you think about retaining your customers, keeping them engaged, how do you really understand your customer mindset and deliver value and build that brand relationship with your customer? And that was kind of where I learned everything from. And then when you get to apply that to supplements and pet food and apparel that customers can't get for free, it's almost kind of like the game is on easy mode. So that was kind of where longplay really came from. When I started longplay, there were no real major email and SMS agencies out there.

Like Chase Simon was already doing amazing work there. And then we had kind of like the bigger agencies that slapped on email and SMS as like a line item, but there weren't true email and SMS only agencies. So that was the first three, four years of the business. And then last year was kind of when we started saying like, hey, email, SMS really are just the absolute minimum for ecom right now. We can do this really well. But there's another stage here and also there's a lot of freelancers out here doing a lot of email, SMS basics. It's becoming commoditized, but no one's really thinking about it properly. So that was when we started building out the retention ecosystem for econ brands and realizing, hey, email and SMS are just the minimum, but how do you start launching additional channels? How do you start launching and loyalty programs, repeat purchase programs, subscription programs, but also then the more retention strategies you have going on, the more they need to integrate with each other.

And that was where that ecosystem approach really kind of came in. So that's kind of the storyline in terms of like, why I'm so excited to talk about retention these days. Because it's like, finally people care and it's necessary now, it's not optional, it's necessary to grow an econ brand.

Yeah, this is really exciting and a couple of things that you mentioned come to mind. The first is you had mentioned seeing a couple of these big brands sort of IPO and valuations aren't so great for them. And I think it just reinforces the idea that you need to build businesses the right way. And what I love about thinking about brand building in the lens of retention is this is something that can be applied right out of the gates when you're starting your business. It doesn't have to be something that you're like, oh, wait till I'm ten figures in revenue and then I can worry about retention. It's something that starts with what you're able to do when you're launching the brand, but then it scales like you're saying, throughout the whole ecosystem, and you can layer on different components. So I think it's really important to start with a really strong infrastructure. The earlier the better, obviously.

And then as you scale, you can kind of put in all the bells and whistles. What I would definitely recommend to guess against, and I'm sure you've got similar views here, is like retention isn't something that's solved with one solid email campaign that you just copy, paste and put in. It really needs to be built into the whole brand and it's really strategic. So I'd love to kind of on that note yeah, I'd love for you to us for this conversation, I'd love to kind of think about things in the lens of different stages a brand might be at and maybe we can start with what it looks like for a brand that's just getting start out. What's the baseline level of a retention or retentive sort of ecosystem that you'd want to have in place when you're just launching a brand and then we can continue on through. As you're scaling, what are the things you're going to want to layer in as you're bringing on more customers, more subscribers, more revenue dealing with more returns and more complex operations?

Yeah, for sure. I think that's such a great way of framing the question. Also the approach and I think you also bring up a few really good points, Blaine as well, which is one, retention can't be approached the same way as like there isn't that one hack, one tool, one channel that's going to fix it all. Whereas acquisition is like you are optimizing for one or two great ads or you are optimizing for one or two channels and acquisition really is this channel specific pay to play strategy, whereas retention is this ecosystem layering strategy. So the key to retention marketing is kind of remembering that and realizing that let's get the foundations right when you're starting out and then start to layer bits and pieces. But you shouldn't have to redo the ecosystem every time you grow. You should be adding components and adding complexity to it. So when a brand is just starting out, like literally just pre launch or building a new brand for the first time, we always say you shouldn't be spending 50 50 on acquisition retention, there's no customers to retain.

Let's just be real about this. So we always say in the beginning, maybe spend like 10% of your time or resources on acquisition is like, let's just get the basics down and then focus all your attention on acquisition. So in the beginning it's like just get your basic email stuff set up is like make sure you have your email capture, make sure you have your absolute basic flows. Like your welcome flow, active on site browse, abandonment flow, add to cart flow, abandoned cart flow, post purchaser, you don't even need a win back flow yet pre launch because there's nothing to win back. So those are like your top, what was that? Five, six flows to make sure you have live and even if you're super tight on resources, just make sure you at least have two emails live for each of those things, the absolute bare bones. And ideally throw in like an SMS capture as well and that should get you pretty good into the mid high six figures in terms of absolute bare minimum. Once you start hitting the seven figure mark and basically essentially one to five mil, that's when you should at least be sending out like one to two campaigns per week. You should start extending those flows.

So for example, making sure your welcome flow has like three to five emails, making sure Bandit Cart has like four emails, making sure your post purchase nurture has a few additional product education emails. This is when you're also going to want to start setting up things like cross sells, replenishment reminders. If you have subscription, you want to start upselling customers subscription. So now you're kind of getting a little bit more strategic with retention around, actually getting customers from one purchase to two and just kind of like fleshing out each of those flows a little bit more and that'll still get you pretty far from that $5 million mark. Once you get to five to ten and then ten to 15, this is when you should start really being heavy with a strategic campaign calendar. So now we're starting to think about, hey, at each stage of the customer journey, what are different ways to leverage the time of the year as a way to convert customers? So for example, if we take, let's take fashion for example, it's so easy to just send the same few product highlight emails over and over again. But the trick with fashion is like, how do you say the same thing 500,000 different ways in a way that's relevant? Because there's only so much you could talk about a t shirt. It's not about the t shirt, it's about everything else the t shirt represents.

So now we're talking about like, hey, how do people relate to fashion in the summer versus how do they relate in the winter? Hey, how can we leverage like, wedding season as a good time for people to go shopping? How can we leverage trends like celebrity fashion styles and things like that to make our clothes relevant? How do you be a part of the conversation that's happening and how does that conversation change? Or how do your customers think about your industry, your products differently at different times of the year? That's when campaigns become a lot more strategic. And then on the flow side, you're doing a lot more A B testing, a lot more segmentation. So you might start doing segmenting your abandoned cart based off of average order value. You might start having a post purchase nurture for first time customers or repeat customers. You might start segmenting your cross sell flow by the different collections they bought from or the different products they bought. You should definitely have a win back flow at this point. So you're really kind of like, again, building out your email and SMS flows. And you should definitely have SMS going by the time you're in that like 510, $15 million range and by kind of the low eight figures, it usually starts making sense.

The testing is like direct mail, so you're now starting to launch the different channels. When we think about the ecosystem, we kind of bucket retention stuff into like three different buckets. There's channels, there's tools and there's programs. So channels are going to be like, you're obviously email and us get you pretty far. Then you might do like direct mail, then you can do P to P outreach with brands like Live Recover can do one text to do Live Agent outreach. You could do organic social tap cart as a mobile app. Those are different channels and ways to reach your customers. So at the eight figure market trying to explore what other channels make sense to test for us, the second one is tools.

So I personally like to think about tools kind of like the little booster mushrooms in mario Kart where it just gives you a little extra speed on certain areas of the customer lifecycle. So for example, post purchase upsell apps, that's like a little booster on adding average order value for purchase. Or you might use a repeat purchase app like Relo or Repeat. Those are about boosting your repeat purchase rate, things like that. So you start thinking about which areas of the customer journey are we losing the most customers? Is it getting that first purchase? Is it getting them up sold to subscription? Is it average order value? And then are there different tools out there that we can kind of test to support those areas? And then third is programs. So that's when we're talking about like loyalty programs, affiliate programs, subscription programs, and programs are like the more complex ones to deploy, but when used strategically, they can kind of move the needle in a lot of different ways. So for example, the loyalty program is like my favorite example of programs deployed badly because most ecom brands, they start thinking about loyalty program around like high seven figures, low eight figures. Usually it's like someone's like, we need a loyalty program.

They find a thing, they set up the platform, then they maybe have a launch email if you're lucky. And then it's like slapped onto the foot of a website and they're like, in a year they're like, hey, don't we have a loyalty program? Oh, it's not working. That's essentially the path of how loyalty program is going to die. But we always say the goal of a loyalty program is not to necessarily drive direct revenue, it's to give you more ways to play with strategically. So loyalty program is like you can use it to promote and drive sales for products that you want a little bit more adoption for. Maybe you can do two x points, three x points to increase product adoption. Maybe you can give additional points for subscription renewals to reduce churn. It gives you a little bit more to play with and it's really about launching programs in a way that's really integrated into the ecosystem.

So for example, how do we actually leverage our email flows and SMS flows to drive customers to sign up for the loyalty program? And then how do we use campaigns to get people to actually redeem points? And then also how do we use a point system to get people to buy more? That's the level of integrated strategic thinking that needs to be approached with programs. And typically I'd say that's more. So to execute at that level is usually like low eight figures, mid eight figure range. But typically the path is get your basic email and SMS set up, start exploring one, maybe two channels, start exploring some tools, like one or two tools that gets you up to the eight figure range and then eventually you can start looking at deploying programs.

So the reason I really like that framework is. I think when you're starting a brand or even when you're further along, it can be really overwhelming because you think you have to be everywhere all at the same time. And a lot of times you're better off focusing on a couple of channels that you're actually nailing and doing the right way as opposed to having all these different channels and just having them for the sake of having them but not actually executing on them. I think that example that you gave of the loyalty program is a perfect one. I'm running a software company right now and what we're seeing is we've got this great affiliate program set up, but it requires a lot of work, a ton of email nurture. It's not just like the fact that we have an affiliate program, it's like you're bringing that same level of product education, email flows, customer touch points and all of that sort of stuff to bring that program to life. If you just leave it and have a button there, it's not going to perform the way you want it to perform. So I think that's really solid advice.

I'd love to dig. I know our listeners are going to be really excited to go deeper into. Let's first start with these first two. Let's talk about channels and let's talk about tools. Right, so when you're just starting a brand, we said you want to have a couple email flows set up, which you outlined, and a couple SMS flows and make sure you're capturing all of that stuff and you want to have a couple tools in place. What are those tools? Let's talk about it at the platform level. So let's assume that you're building on Shopify. What tools are you using to send your email and SMS? What tools are you using if you're a subscription brand, for example, what help desk are you integrating and where are you getting your data and where you're pointing your data to generate these baseline retentive flows?

Yeah, for sure. Also, before I even get into this conversation, I know this is a hot topic in the space, I want to be fully transparent, which is like we have partnerships with a lot of these platforms. I'm not getting any sort of affiliate deal talking about this right now. And we only form partnerships with the ones that we actually think are good. So just like it's all out there, do without information, what you will.

This, I want your take. Like what are you using, what are you seeing from it?

Yeah, let's hear it. Here's where we're at. So in terms of platforms, I mean, email and SMS, Klavio is still the leading charger on all this. It's still like the one that we're still bringing most of our brands onto most of our clients. Come on Klavio, we kind of keep them there. I do see some opportunity for some smaller brands on Sendlane as well, but for us personally, we're mostly on Klavio right now. SMS is also mostly on Klavio just because we like to keep it integrated. But we do have some brands like Attentive and Postscript as well.

So just kind of the usual players in the space subscription. We're really liking Skio right now, mainly because I think, one, they're actually built by people in the ecom space. They understand what functionality is needed. But two is they have a lot of functionalities built in that unlock a lot of strategies that you can execute on other platforms. And that's really what we're looking for when we're thinking about tools and platforms, is like, what do we want to execute strategically? What platform is going to give us capabilities to do that? So with Skio, we have things like surprise and delight. You can drop in a free trial, sample packs and all that helps with retention in the sense of expanding product adoption, reducing subscription churn. That's why we like Skio for subscriptions. Relo is one of our favorite tools for repeat purchase because they have magic carts and a lot of pre populated type stuff there.

And then postpilot for direct mail that we really like. And what was the other one aftercell for post? Purchase? Upsells and Live Recover is doing some pretty cool stuff with P to P. I think they're just getting started in terms of this growth opportunity there for them there for sure. And those are kind of like our top few tools that we're definitely using the most. I'm probably forgetting a few off the top of my head, but the big ones are really around one. What do you want to execute strategically? First, decide on your strategy, and then figure out what tool matches to that. Second thing that we always look for is all these tools are run by people with ecom experience, so they kind of know, they genuinely know the DSC ecom space well. They know the pain points, and they're building functionality to fit that.

I think the third thing, too, is all of this is tested. There's no one size fits all strategy. We've had certain apps work really like ten X ROI on some clients, and then the other ones, it doesn't work very well. And that's totally fine as long as you're iterative in terms of testing. So we always say, run it for 30 days, run it for 45 days, set your test. So, for example, if we're doing direct mail tests, we're like, hey, these are three customer segments we're going to run on it's very carefully chosen. We're going to run us three campaigns, see if there's ROI on it. If it's good, then great.

We're going to scale the channel. But don't go test direct mail just because everyone else is testing direct mail. Limit your risk. Test the channel, test the tool, set a timeframe, and then cut it if it doesn't work. But make those decisions yourself. As a brand.

We are really excited to announce that Dtcpod is officially part of the HubSpot podcast network. The HubSpot podcast Network is the audio destination for business professionals and we're really excited about being part of the network because we're going to be able to keep growing the show, bringing you guys amazing guests and obviously helping you guys learn from the best founders, marketers and builders of the most successful consumer brands. So anyway, keep listening to DTC, Pod, and more shows like us on the HubSpot podcast Network at love to. Also, now that we know a couple of the tools that you use and the different brands that you sort of work with, I love if you have any examples that you can speak to of really successful engagements or ways that maybe you worked with a brand. You came in there, you saw them doing something, and you were able to spot out, like, oh, this is something that the brand has currently set up, that you've seen be something that's an opportunity for you to come in and fix. I'd love to kind of understand what are the things that a lot of brands maybe do and think they have. Right. But with all the experience that you have of setting up these flows, it's the first thing that you kind of come in and are able to fix and get them on the right track around.

Yeah. So super low hanging fruit, active on site and add to cart flows. I feel like 60% of brands, 50% to 60% of brands coming in for the first time don't have this. And we work with 79 figure brands, surprisingly. So those are usually like, make sure you have an active website. Make sure you have an add to cart. I think usually those two are missed because they're not built into Klavio as like default ones. So if you're not like a retention expert, you're just naturally going to miss it.

So make sure you have those two.

Do you want to explain exactly what that means?

Yeah. So I call them like the Triad or four buyer intent flows. So active on site is anyone who's landing on your site but hasn't landed on a particular product page. So that's what that flow targets. Browse, abandonment is anyone who visits a specific product page. Add to cart. Flow targets customers who have added a product to cart but haven't started at checkout and then abandoned cart only actually kicks in after someone starts the checkout process. So those are essentially the four flows that target each stage of a customer trying to make a purchase on Ecom store.

And usually people only have like, browse, abandonment and abandoned cart and they're kind of missing the other two.

Cool. And just jumping over here a little bit. I know it's a slightly different channel, but SMS, right? I feel like everyone talks about SMS and some brands do a really great job at it. And some brands. Just send random SMS because, yeah, they're going to perform. You're getting a notification on the phone, but why don't you walk us through a little bit of how you think about actually using SMS. What's the context that you're using it? Is it just for new product releases? Is it for subscription updates? How are you using SMS to make it really good in terms of retention and adoption?

Yeah, it's a great question. I mean, first off, to echo your notification comment is check your SMS attribution settings on your platform because I've heard like 30 day open on SMS, which is absolutely preposterous because who's going to leave an SMS unread? I guess some people do, but it's just way over attributing. So double check your attribution window there. In terms of how we think about SMS, the core of how we approach retention is flipping from a channel specific to a customer centric approach, which is instead of saying, hey, what's our email strategy, what's our SMS strategy, what's our direct mail strategy? We're saying what's the customer lifecycle? What's the journey? Where are they getting stuck on? What do they need to receive? And then what's the best channel to send that message? Is it through email? Is it through SMS? Is it through direct mail? So that's kind of how we think about SMS marketing. And because of that, a lot of SMS marketing for Flows very much mirrors email marketing because it's still the same customer touch points, right? It's typically kind of a pared down version as simplified versions. Like a welcome flow might have like three to five emails. You definitely don't need three to five SMS welcome text, you might just have one. But that being said, if you have a post purchase nurture flow, an email that's like nurturing customers after they made a purchase, certain messages might actually be better from SMS.

You could send an SMS that reads like it's from a customer service team member and be, hey, like it's. Blaine here. Just want to check in on your recent purchase of whatever product. Hit reply if you have any questions about how to use it. Transforming that exact same check in message from email to SMS has drastically changed the customer experience of it. And we're still thinking from the mindset of, hey, what does the customer need to receive at that point in their journey? Which is, hey, it would be great if they received a personal touch, just checking you in on how to use a product. Oh, SMS is actually a great channel for us to execute that message versus email for that personal touch feeling. So that's kind of how we think about SMS.

For campaigns, it's still very similar. Typically content style SMS don't really work well, whereas content emails work really well. But then like promotions, product launches, SMS is still great. The biggest difference between email and SMS typically is like paring down the volume and also a lot more, making it a lot more concise. So it's like, I know a lot of brands are like, want to be so branded with SMS to tell a story. It's an SMS, just embrace the channel as it is, get to the point. No one needs an essay on their phone. That's what email is for.

So give them the information. And then channels like Live, Recover and also one text as well are doing some pretty cool transactional stuff around getting conversions through SMS. So those are two channels that we've been playing around with a lot as well.

I think one of the things that brands really need to think about as they're sort of scaling and this is something that I've had a bunch of experience in building software products, consumer app products, is like the experience with the customer is no longer just like send a product and it ends there, right? It's a really immersive lifecycle experience where you've got elements of education, you've got elements of retention, elements of telling them what to expect. So like proactive kind of customer experience sort of things and all these other touch points that really bring the product experience into their life as opposed to just like, okay, I received the product and it ends there. Right? So I think what's really great about how you're thinking about SMS is you said it really depends on the business, what is the product? We're not just sending SMS for the sake of sending SMS, it's because it fits within that digital strategy and digital communication with the customer. The next thing I'd like to talk about is on the email side of things, right? What data are you sinking in? What are you pulling in to be able to set up these flows and establish these cohorts?

I mean, most of it initially is a lot of just shopify type stuff. So most of your segmentation should really be behavioral to begin with because that's like most of the data. So we've had differentiated between zero party data, which is like surveys, like customer preferences, like birthdays, demographics, like that type of thing, which is data that customers are giving you themselves. And then there's first party data which is behavioral. Like they're opening an email, they're making a purchase, they are abandoning a cart. Most of your email and SMS strategy and even your direct mail strategy up until I'd say, like early eight figures is mostly behavioral. There's always opportunity on the zero party stuff, but there's just like from a priority standpoint, you're going to move the needle. The most behaviorally.

So most of that is just shopify data, website behavior. And then you might have like subscription apps being integrated in there as well. And most of it is around website activity, what products they purchased, how frequently they're purchasing, winback lapse in customers engagement on email. Once you kind of get past that point, then you can start using preferential data. So typically we like to yes, it's great to collect birthdays and anniversaries and demographic data, but with all data, it's not about how much data you have, it's about how you use it and what do you need to know about your customers that's actually going to change the journey they need to go down. So, for example, if you have an apparel brand and you sell a blue T shirt versus a red T shirt, yes, you could segment that data and create two totally different post purchaser journeys for a red T shirt versus blue T shirt. But is there really any true psychological difference between a red T shirt buyer and a blue T shirt buyer? Probably not. You could segment, but it's not going to move the needle much.

But someone who's bought one T shirt versus ten pairs of pants, that is actually probably two different types of customers that need to go down different customer journeys. So thinking about it that way, which is what information can we pull to actually help us identify different groups of customers who are going to have very different purchase behaviors, very different pain points, very different needs? And kind of related to that is like using tools like Octane for quizzes, like no for post purchase and pre purchase surveys, things like that. That's useful information in the sense where you can kind of get a sense of like, hey, if it's a let's say it's a skincare brand, it's like, oh, what type of skin do you have? Is it dry skin, oily skin, acne prone skin that is actually going to inform what products you recommend them? Or are you male, female, age, if those are really relevant to their pain points. So that's kind of the next stage of data, and that's typically starting to become more relevant once you start hitting like, 20 million plus, then you have the resources to start splicing that data. And it's a lot of work to build out five times the amount of emails, five times the amount of flow. So you better make sure you have the volume of audience to justify that work.

Jess, my next question was going to be I know you had mentioned some stuff about direct mail, and that's not a topic that we've gotten to go too far into. Why don't you just tell me about the channel, how it works and how you use it to complement your retention strategies.

Definitely think it's a channel worth testing for a good amount of ecommerce. This doesn't necessarily mean it's going to knock it out of the park, but I think it's usually worth testing. The way we think about direct mail is if we just look at back at business fundamentals, email is the cheapest out of the three channels, SMS is the second cheapest, and then DirectMail is the most expensive. So the mistake that a lot of brands make when they tackle direct mail is like, hey, we sent a postcard out to a bunch of people, and the platform shows that we generated ROI. That's great. And theoretically, you did. You generate revenue, but if it cost you a dollar to send a direct mail when you could have converted them off of email for ten cents, then technically you lost $0.90 on that customer, right, from a business standpoint. So that's how we think about direct mail strategy, which is like, first, if we're going to test direct mail, let's test it on people who we tried to convert through email, we tried to convert through SMS, are still not converting, or they're helping us access net new audiences that we couldn't reach through email and SMS.

That is a great place to start testing direct mail, and then from there, you can start expanding and supplementing and doing more complex strategies. So, typically, our favorite test, and obviously this is still different for every brand, is doing one that's non purchasers. So customers who've been on your list for a while, maybe like 60 days, 90 days, whatever your typical conversion rate period is, it's double converted off of email. You've tried everything? Cool. Let's try direct mail, then. You know that it's a pretty clear cut. Is this channel working for us or not? Second is winback. So again, same thing.

It's like we've tried email, SMS, winback. It's not working. Let's try direct mail last. And the third is using their prospecting, so they do a lot of lookalike audiences. Like, Postpilot has that feature as well. And that's how big you access net new audiences by leveraging your email and SMS base. So those are the three types of groups in the way that we think about it to test, because we know, hey, if it works on these three audiences, we're pretty confident that there was actually positive ROI on direct mail. If we just send to a whole email list and it says positive ROI, we're like, Are we really sure? Because I always splice the data.

I'd see if we could have there's just too much overlap. So I would say test with that mindset, and then from there, if it works and we always say test with the campaign. Send one batch to just non purchasers, one batch to win back, one batch to lookalike, it's a one time campaign. You get the results if it works. Now, you can take that exact same email or direct mail literally duplicate as a flow. So now it's this ongoing thing that runs alongside your email flows that's just the most ROI, positive, efficient use of resources. Way to test that channel.

That one's really great. I love the concept of use. It almost like you're paying for it. Email, you can send for free. So exhaust your free options first, and then use your paid options once you've already done that. And you could even apply logic like that to SMS, for example. It's like you don't need to be SMS text blasting everyone all the time. If you can handle it with an email and they respond to it, great.

If it's something that's really important for the customer journey and their retention, then you can step over to SMS and if not, then you can hit them with something in the mail. My next question about direct mail would be, how do you think about the creative in that sort of thing? Because you've got a piece of paper, obviously, and you're trying to tell them to take some sort of action. If there's too much going on there, it just gets thrown out. But at the same time, you only have a second to catch their attention. So in terms of the creative brief and the creative side, that goes into coming up with a campaign that performs really well, how do you think about that?

Yeah, good question. And I think this really brings up the core thing, which is like the medium dictates the message, which I think is like, o'gilby, like 101 type marketing mindset. I always say with all marketing, think about it from your shoes is like, when you're going to your mailbox and you're going through your mail, how do you consume that content? You're definitely not sitting there going like, I'm going to read each of these pieces of mail. And yet when we do create, we think about it that way, we're just like, wow, really psychoanalyzing. This whole thing. Is this one brand, is this the right font? Is this the right size? All this stuff. Really what we like to do is design a thing, optimize it based on your brand, do the thing, but before you send anything, literally just zoom out on Figma or whatever platform you're using and just if you can't really read anything and you can only see the headline, what catches your eye? Is there a clear headline on like, this is what we're selling, this is the value prop. Either this is what we sell, like, hey clothes, hey dog, smooth, or this is the value prop that we give you.

This is the problem you solve. And you need to convey that in the microsecond that it takes for someone to look at it before they throw it out. And then also, is there a clear way to get the thing, which is like QR code, discount code, website, like something to capture their eye from the conversion standpoint. You don't need them to be sold off the bat, you need them to be interested off the bat enough to do the next thing. And that's always like, what is the role of this thing at each stage? We talk about this in email, we talk about at SMS. When you try to do all of it all at once, it doesn't work. Sometimes the only role of an email is to get them onto the product page, and the product page does the selling, right? So you actually want to keep the email short. Same thing with direct mail.

You're not trying to sell them to the point where they're trying to give you their credit card. You're just trying to get them interested enough to land on your product page, sales page, funnel, whatever. So really thinking about it from that mindset, which usually means, like, brief, direct, big typography, and clear information hierarchy.

No, I really like that. I think that's a great little trick, just zooming out on figma because that's how much time you have to catch someone and you want something that definitely pops. The last thing I want to talk about is what you guys are building with backbone. I love talking about different products where founders are scratching their own itch because they've seen a problem and they know that they can build something to solve for it. So, yeah, I'd love to. You obviously have a really deep knowledge and insight into the overall retention, email communication sort of space. So what were some of those problems that you look to alleviate, and how are you building out backbone? How does it work? Yeah, just tell me about it.

Yeah, so backbone kind of came out of, honestly, me trying to get out of the day to day of the agency. This was like two, three years ago. We have an amazing team now, and in the process of trying to hire for good email strategists and things like that, we're like, it's really hard to hire for good strategist. So we started building a lot of playbooks around. Hey, here's how you build an email campaign calendar. Here's how you prioritize what flows, like, a brand needs at XYZ. And then it started getting more and more complicated. So we're like, okay, if the brand is at this size or this industry, then this is the priority of flows, and these are some campaign ideas.

So in that process of building out all these playbooks, we realized this is so in detail in terms of mapping out exactly how I think that this just became algorithms. So we're like, wow, we can literally translate this into computer code. And now we have a tool that can automate the strategy development rather than the creative. So we find a lot of email tools. So, first off, we have zero interest in competing with Klavios mailchimps. We're not trying to be an ESP. We're also not trying to be a template builder because there's a ton of those out there, and everyone's trying to do AI creative. We're trying to automate is this exactly what we've been talking about this entire episode? Which is, how do you think about priorities? How do you decide what campaign topics to send? How do you build an email layout that is designed for conversion? And also, eventually, how do you analyze that data and continuously improve performance? So that's really what we're tackling, is automating the methodical thinking of an email marketer.

So what Backbone does is brand comes in, they can plug in their industry, business size, the number of SKUs they sell, bundle, subscriptions, kind of all the core elements of what's going to affect the strategy. They will then plug into Backbone. Here's how many emails we want to send each month. We have these promotions, we have these product launches, and Backbone will literally plan out your email marketing calendar for you. So tell you what emails to send for your promotion content. Emails, campaign emails. We literally have a database of 7000 different unique campaign ideas in the D to C ecom space that then get matched and sorted for each brand. Then from there, it also recommends what flows, prioritizes it for you each month and then also then generate an email layout that's all optimized for conversion.

So now you can export it to Figma and do all your design in there knowing that it's exactly this. It's like built to convert. It's like, you know that if you zoom out, the headline is going to be clear. If you zoom out and you scroll really quickly, you know where the images are and there's call to action buttons everywhere. So Backbone is really built to help brands get off the ground. Like that pre launch to one to 5 million of like you just need the basics down. Don't over engineer this. This is the foolproof, low cost, early stage needs for email and we're just in our MVP.

So our product Road Rap, we're super excited about, but that was kind of where Backbone came from.

That's really exciting, especially because I've been through starting a couple of companies and always putting pen to paper and coming up with your flows and writing it. And it's always a lot right? Because you're like, these are my first customers. Am I sending the right thing? Am I forgetting something? All these different things. So that's really cool. I'm definitely going to have to check it out. And as we wrap up here, Jess, where can our listeners connect with you personally and where can they find out more about Backbone and Long play?

Yeah, so Twitter is going to be the best place to find me personally so that's Jess Chan with two J's is my Twitter handle. And then for our team, Longplaybrands.com, and we also have longplay brands on Twitter as well. That's where you can learn from our amazing team and just get like a done for you solution as well.

Sweet. Well, thanks for coming on the show, Jess.

Thanks so much for having me, Blake.

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