Lesson 3: The Karmaloop Bounce-Back Campaign

Course content (12 lessons)

In this lesson, Drew shares a tear down a campaign that worked very well for his team at Karmaloop in our effort to increase AOV. This is how to create a bounce-back campaign.

[MUSIC PLAYING] DREW SANOCKI: Welcome to module 3, lesson three. In this lesson I'm going to tear down a campaign that worked very well for us a Karmaloop in an effort to increase our AOV. It's called a bounce-back campaign. One problem we had at Karmaloop was our custom cart dated back to 2001. You can imagine when I went into the IT department and said I wanted to do a post purchase upsell funnel they laughing right out of the room. "You come in here with your highfalutin ideas and your fancy MBA, and your fancy shoes." That's the reaction I got.
So I decided to do the next best thing and move the principles behind the sequence out of my cart and into my email software. It worked really well. And I think even if you're on Shopify you might consider this campaign given the speed with which you can install it. Bounce-back campaigns are common brick and mortar retail idea. The goal with the bounce-back campaign is to improve the same day AOV. Every first time purchase will trigger an immediate exploding offer on a complementary product.
That offer will drive the customer back to buy immediately. Now, technically you're creating a new order here but because it happens on the heels of the previous order, I think of it more as an AOV increasing mechanism, especially if you can batch your orders before you fulfill them. This is Karmaloop's bounce-back email campaign. It was triggered at purchase day 0. The subject line was you want fries with that? The classic McDonald's cross-sell.
I wanted to feature a high margin, low AOV product, basically an impulse buy. So I decided on t-shirts. We always had them in stock and we still had nice margins even at $9. To add urgency, I added a clock timer just completely fictitious and a long convoluted looking coupon code also fictitious-- you could probably use it right now-- and some really strong language. So you see we didn't have the tactical capability of doing any of this stuff.
Expiring coupons, individual coupons, and stuff that everybody gets hung up on. But why stress about these things, I mean the customer clicks on these t-shirts he goes back to the landing page and he buys the $9 t-shirt. Right, mission accomplished. The results of this campaign were really impressive given the amount of time I put into it. I set up that email over an hour, probably while I was eating a happy meal at McDonald's. It ended up increasing our overall AOV, 5%, which at the time amounted to $3 million in revenue over the year.
And because the t-shirts were so profitable much of that revenue was profit. The bounce-back works because it plays off recency. A recent customer is an engaged customer. They're much more likely to buy again than a customer who's not recent. And bounce-back's take advantage of that. So think about recency. The most opened email for any customer is typically the order receipt. It's super recent.
Ideally you should send these offers out in your order receipts but that's not necessary. Using apps like Klaviyo or Mailchimp or converzio you could have one of these triggered at checkout in no time. To recap what I talked about in this lesson, if you're looking for a solid quick AOV win, I encourage you to think of the bounce-back email campaign. I'll put a template of the one I used at Karmaloop at the end of this lesson. In the next lesson, we're going to move on from multiplier 2, AOV to our third and last multiplier, acquisition.
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Lesson 3: The Karmaloop Bounce-Back Campaign

Course content (12 lessons)

Module 1: From Acquisition to Retention

01 |Module 2: Increasing Purchase Frequency

02 |Module 3: Increasing Average Order Value

03 |Module 4: Increasing Your Customer Count