Ringing in Revenue: How Phone Conversations Are Reshaping D2C eCommerce Success

Ringing in Revenue: How Phone Conversations Are Reshaping D2C eCommerce Success
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8 Actionable takeaways from our conversation with Jason Weiss, an eCommerce sales expert:

  1. Embrace Phone Outreach: Phone calls are a potent, yet underused, tool for DTC brand growth
  2. Focus on High-ROI Calls: Target subscription reclamation and pre-lapse customers for best returns
  3. Personalize Interactions: Use calls for direct, personalized customer engagement to handle objections and enhance experiences
  4. Implement Win-Back Campaigns: Re-engage lapsed customers with tailored phone strategies
  5. Surprise with Welcome Calls: Boost retention with unexpected calls thanking new customers
  6. Combine Communication Channels: Integrate calls with emails and SMS for a comprehensive outreach strategy
  7. Harness Customer Insights: Leverage exit and post-purchase data to refine and personalize sales approaches
  8. Strategize Voicemail Use: Optimize voicemail impact in specific campaigns for efficiency

Adam: Okay, cool, we're live. Today, I'm joined by Jason Weiss, a sales expert who has been building out sales teams for D2C brands. I'm really excited to delve into this topic because it's not one that I think is popular anymore, and for some reason, it's a bit taboo in DTC circles. We're going to talk about using the telephone to build D2C brands, how it's a missed opportunity for a lot of brands, and how this can be a weapon in your arsenal to convert more customers. So, Jason, why don't you give us a quick intro into your background in the industry, and then we'll dive into this topic.

Jason: Yeah, sure. So, I've been involved in sales for 25 years, with a major component of that being direct to consumer for the last 18 specifically. I've been working with CPG in the supplement and beauty industries, selling, for example, the largest private label prostate product in the US, Super Beta Prostate. I've worked with Force Factor, which is one of the largest sports supplement brands on their D2C side.

I've put a big focus on building and creating sales teams for every company I've been at. My sales teams have done seven and eight figures in revenue at 200% ROI within the first year, and that's through systems that I've created over the years that really leverage a lot of the data that we pull in through e-comm, re-engagement of lapsed customers, and handling abandoned carts, among other things. It's been a wild ride, to say the least.

Adam: So, we've got a very similar background since I'm from supplements and consumer packaged goods myself. It's going to be interesting to go a little bit deeper into these topics. But let's start with using the phone. Why is it such a powerful sales method? It's always been historically something that's used, but why has it fizzled out? Why has it become something that now all of a sudden you can't call customers? Where has this come from, and why is it such an underused thing that you can bring back?

Jason: In my opinion, there are really two major reasons that have pushed the phone to the side of the industry. The first is regulatory. The FTC and FCC in the States have put a lot of rules and regulations in place, specifically because of bad actors, that hinder a company's ability to make these calls. It's not that they can't make them; it's that they need to understand the intricate rules.

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At least in the States, you have not only the federal rules and regulations but also state-level ones you have to be aware of when making calls. For instance, there are several states that don't acknowledge an existing business relationship, even with a financial transaction, for consumers. So, dialing them puts you at risk. There are four or five states, I think, that we completely scrub from our lists for reasons like that.

The second reason is that if done improperly, it can be extremely costly with very low ROI. Let's be honest, it's also a lot cheaper and easier to send emails and SMS, which is picking up right now and has its own regulatory challenges. Social media and these other sorts of channels that exist have put the phone in the background because it's harder to run a phone campaign than it is to run some of these other campaigns. You're dealing with a lot of people, and it's personnel-based.

The Power of Personal Connection in E-commerce

Jason: It's really interesting to see the comparison between scalable methods like email and SMS, which are huge broadcast campaigns with low cost and high automation, versus the personal connection and conversational approach that is becoming increasingly popular among marketers. There's arguably no better way to connect with a customer than picking up the phone and speaking to them directly.

One of the reasons I love using the phone is its effectiveness in handling specific situations, such as abandoned carts. It's challenging to infer why a cart was abandoned based solely on digital data, such as the duration spent on a page or the point in the process where the abandonment occurred. However, on the phone, when you encounter an objection, you have the opportunity to address it directly.

Not many companies have funnels that deal with specific rebuttals throughout the entire ordering process, but with phones, that's precisely what you have. For example, in win-back campaigns for lapsed customers, asking directly why they haven't reordered allows you to work on re-engaging them. Many companies struggle to collect information digitally on why customers lapse and to provide unique and personalized approaches to re-onboard them.

Consider win-back campaigns that primarily focus on discounts to re-engage customers. This approach can be tone-deaf, especially in sensitive situations like a customer losing a pet when dealing with pet supplements. Phone calls allow for a more adaptable and personalized response based on the live interaction with the customer.

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Prioritizing Phone Campaigns in E-commerce

Adam: That's fascinating. Considering the potential expense of using the phone, where do you see the best opportunity to prioritize this technique? For instance, comparing the impact of abandoned carts versus win-back campaigns, where are the quick wins?

Jason: Great question. The first campaign I always prioritize is subscription decline reclamation for customers whose auto-ship orders aren't processing. However, if a company uses a free trial as their acquisition model, I wouldn't start there due to the high volume of low-value customers, which could negatively impact ROI. After addressing subscription declines, the next focus should be on straight sale customers who are past their reorder point. Reaching out before they lapse significantly increases the likelihood of re-engagement.

Abandoned cart campaigns are another favorite of mine. While the initial ROI might not be as high as the first two campaigns, acquiring new customers through this method can increase lifetime value (LTV) over time. However, due to regulatory reasons and the absence of a financial transaction, these calls require a more cautious approach and prompt action to maximize effectiveness.

Customer Reactions to Phone Outreach

Adam: How do customers generally react when they receive a phone call from a brand? Is there an element of surprise, or are they generally receptive?

Jason: Most reactions range from neutral to happy. While it's inevitable to encounter a few unhappy customers, as is the case in all customer service and sales interactions, the majority of calls are well-received. Scripting plays a crucial role in navigating these interactions, providing a guideline for the team to ensure a smooth introduction and manage any initial hesitation from the customer. The decline campaigns might face more challenges due to misunderstandings about auto-ship agreements, but overall, the response is positive.

One of my favorite campaigns is the welcome call, where we thank new customers for their order either on the same day or the next day. This approach is typically reserved for higher-end premium brands, making it a pleasant surprise for customers who might not expect such personalized attention from an e-commerce brand. The primary goal of this campaign is customer retention, aiming for a break-even ROI while focusing on improving long-term metrics.

Jason: In conclusion, phone outreach offers a range of use cases, from pre-purchase considerations to retention and win-back strategies, providing a unique opportunity for e-commerce brands to personalize their customer interactions and stand out in a digital-first market.

Adam: You mentioned you're a big fan of scripting. Let's run through a scenario. I'm on the website, shopping for pet supplements, and I abandon the cart. Could you run me through a basic script of how you would approach it, given that you have my phone number?

Jason: Absolutely. "Hey Adam, this is Jason calling from Pet Products Anonymous. I see that you were on our website looking at our canine multivitamin, but you didn't complete your order. I just wanted to see if you had any challenges on the website or if you had any questions about the product specifically."

Adam: No, I got busy. I went on Amazon and just completely forgot about it.

Jason: Yeah, that happens to a lot of our customers. Obviously, you're a pet owner. What kind of animal do you have?

Adam: I have a Labradoodle.

Jason: Awesome. And what brought you to the website today? What specifically is going on with your Labradoodle that concerned you?

Adam: He's old. He has anxiety, so I'm looking for some specific supplements that would help with this.

Jason: That's great. You know, a lot of people, and pet owners like yourself, don't realize they'll take a multivitamin every day but it's not something they think about giving to their dog. Even the top-level pet brands are missing a lot of micronutrients that help support the health of a pet. Our product is cold processed; you get these nutrients in their specific measurements. Since you visited our website today, I have a special offer most of our first-time customers use. When you buy two bottles, which is a six-month supply, you get a discount. The total will only come out to X amount. Can I complete your account setup for you?

Adam: I love that. You've got me at the sale right there. I love the way you anchored in, put the questions there. You specifically dug in there and tried to find out the objections and solve the customer's pain that way.

Leveraging Data for a Customized Approach

Adam: One of the things I love about the content you put out is you specifically talk about exit surveys and post-purchase surveys to gather more data on the customer. It's the same concept, right? The more you know about the customer, the more likely you are to close the deal. And at the end of the day, if there's not a match between customer and product, you want to know that too, right?

Jason: Absolutely. If someone calls in, you mentioned anxiety specifically, you'll notice I didn't really talk about anxiety because you had other issues as well. I'm not going to talk about anxiety if my product doesn't do anything for anxiety. That sort of congruency between need and product is a huge piece.

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Setting Expectations for Call Length

Adam: Given the time you may spend on the phone to try and convert someone, do you have a limit within the script, or do you let the conversations flow naturally?

Jason: It's true that some customers might want to sit on the phone all day. Unlike most call centers, I don't put average talk time as a main metric because I am asking you to sell. Some calls can close in two and a half minutes; some take 12-15 minutes. What's important is staying on task. If you're talking about the weather or local sports teams, you're off topic. It's not about selling on rapport; it's about focusing on the emotional benefits of the products.

The Myth of Selling Based on Likability

Adam: People say, "People buy from people they like." I would agree that's not necessarily true.

Jason: It's very similar to the notion that there's no such thing as B2B, you're selling to a person. The data says if your company has 100+ people, you're going to be dealing with seven decision-makers. While a specific person is the one that's going to get you across the finish line, it's the product that got them interested in the first place. It's the benefits of those products that generate sales, both in marketing and in phone calls.

I completely agree that likability and building relationships play a crucial role in sales, but it's not the sole reason a sale is made. The ability to build a relationship is a bonus. The primary reason customers make a purchase is that they like what we're saying, agree with it, and want what we have. On the B2B side, likability and friendship can certainly help in retaining customers, especially when it's time for contract renewals. However, on the D2C side, the dynamics are quite different.

Many companies are moving away from phone-based customer service, and the chances of speaking to the same customer service representative twice are slim due to high staff turnover rates. The relationship on the D2C side is more about the product rather than the brand. Many customers don't even know the brand name; they know the product. This highlights the importance of the product itself in driving sales and customer loyalty, rather than just the branding.

The Strategy Behind Win-back Campaigns

Host: Before we wrap up, I'd like to dive into win-back campaigns. There's been some debate about their effectiveness, with some claiming they're generally low ROI and not worth focusing on. Can you share your approach to win-back campaigns, especially with the example of pet supplements?

Jason: Win-back campaigns are an essential part of our strategy, especially for straight sales where customers haven't reordered as expected. We typically reach out five to seven business days after the expected reorder date. For voluntary subscription cancellations, the strategy might vary based on the reason for cancellation and the company's ability to segment their audience.

The most likely customers to win back are those who cancel because they have too much stock. Understanding how much supply the average customer has left when they cancel is crucial. In the nutraceutical industry, for example, customers who cancel due to overstock usually have about three to four months' supply left. We aim to call around 90 days after cancellation, often incorporating discounts to facilitate the win-back.

The Impact of Phone Calls in E-commerce

Host: It's intriguing to consider how underutilized phone calls are in e-commerce. Given the data available, including customer phone numbers, it seems like an untapped opportunity for direct engagement. How have you seen the effectiveness of phone calls compared to other mediums like email or SMS?

Jason: One of the more interesting experiments I've conducted involved abandoned cart recovery through phone calls. We compared the cost per order and effectiveness of phone calls against email campaigns. Initially, emails were seen as more cost-effective due to their lower cost per engagement. However, after implementing phone calls, our abandoned cart recovery rate significantly increased from around 1.5-2% to 7-8%.

When we briefly paused phone calls, we noticed a decrease in email conversion rates, underscoring the effectiveness of phone engagement. The CEO quickly recognized the value and instructed to resume the phone campaign immediately.

This experience highlights the untapped potential of phone calls in e-commerce. While digital channels are essential, direct phone engagement can significantly enhance customer re-engagement efforts, offering a more personalized touch that digital mediums often lack. Considering the costs associated with retargeting on platforms like Facebook, reallocating some of that budget towards direct phone calls could provide a more impactful and cost-effective strategy for re-engaging customers.

Leveraging Multichannel Strategies for E-commerce Success

Jason: The integration of multiple outreach channels, such as phone calls and emails, has a significant and often underestimated impact on e-commerce success. This strategy creates what's known as the halo effect, enhancing the effectiveness of each individual channel. It's a mistake to silo communication channels, thinking one should be prioritized over the others. Instead, they should all complement each other, keeping the brand top of mind for consumers.

The most challenging situation I encountered involved a company with different pricing strategies for reorder, catalog, web, phone, and direct mail campaigns. It took us years to align these strategies, highlighting the importance of consistency across all channels to avoid customer confusion and dissatisfaction.

Adam: I see your point, especially regarding discounts in win-back campaigns. Could you expand on your approach to using discounts effectively?

Jason: Absolutely. Discounts are a critical tool in win-back campaigns, acting as a last-ditch effort to retain customers on the brink of departure. The strategy following the discount is crucial; for subscribers, we lock in the discounted price, but for non-subscribers, regular pricing resumes. It's important not to condition customers to expect discounts constantly. An example from my experience involved an email campaign offering a 25% discount at the end of each month. This campaign was highly profitable but encouraged repetitive purchasing patterns. To mitigate this, I initiated phone campaigns earlier in the month, diversifying our approach and ultimately achieving a net positive impact on revenue.

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The Impact of Direct Communication in E-commerce

Adam: How do you handle potential obstacles like leaving voicemails during phone campaigns?

Jason: Voicemails are primarily used in decline campaigns where the urgency of the message prompts a callback. For other campaigns, leaving voicemails can hinder productivity by taking time away from making more calls. The foundation of successful phone campaigns is the volume of dials; without a sufficient number of calls, sales targets cannot be met. My teams aim for 250 to 300 dials in an eight-hour shift, manually dialing to navigate regulatory challenges and maintain high engagement levels.

Enhancing Sales Skills for Business Growth

Adam: Sales is often seen as a daunting field. How do you view the importance of sales skills in e-commerce and business in general?

Jason: Sales is fundamentally misunderstood by many, with fear stemming from a lack of proper training and management. In industries like SaaS, for instance, ineffective email strategies result in low response rates, highlighting the need for shared successful tactics across teams. Understanding sales and human psychology through direct interaction not only bolsters sales skills but also significantly improves marketing strategies, making one a more effective communicator and strategist.

Adam: For those interested in deepening their sales knowledge or seeking advice, how can they reach you?

Jason: I'm available on LinkedIn and can be reached directly at jasonsweiss28@gmail.com. I'm passionate about discussing sales strategies and sharing insights gained from my extensive experience in the field.

Adam: Jason, thank you for sharing your comprehensive strategies on using phone calls and sales techniques to drive e-commerce success. For our audience with questions for Jason, feel free to engage in the comments, and we'll ensure he sees them.

Enjoyed this conversation? Follow Adam Kitchen on Twitter or LinkedIn, and don't forget to join 5,000+ hungry D2C enthusiasts who lap up our weekly insider insights on eCommerce email marketing.

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