Email marketing

How italist’s retention marketing drives new customer acquisition, too

Mae Rice, October 25th 2022

Italy is a global destination for luxury shopping—and Alex English, head of growth at italist, knows why firsthand.

“I lived in Italy for a year and a half,” English explains. (He got his MBA in innovation and marketing at Bocconi, a prestigious business school in Milan.) “I’m pretty well versed in what’s out there.”

It’s not just that it’s headquarters for top fashion brands like Gucci, Prada, Fendi, and Versace. Shopping in Italy has a unique appeal for two other reasons:

  • The latest Prada bag is cheaper in Italy than anywhere else.
  • Italy’s retail buyers have a knack for spotting emerging trends and designers.

Well, it had a unique appeal. In italist’s online store, shoppers can now access that when-in-Rome pricing and curation from anywhere with an internet connection.

italist aggregates its 250K+ SKUs from independent Italian boutiques, and their selection is a cut above.

“We will have stuff that Nordstrom or other online players won’t have,” English says.

italist’s revenues have grown steadily year over year, and some customers have spent a lifetime six figures with the company.

None of that is a coincidence.

Shoppers have taken notice. italist’s revenues have grown steadily year over year, and some customers have spent a lifetime six figures with the company.

None of that is a coincidence.

“We have been pretty careful to go after valuable leads,” English explains. “So not necessarily just trying to get as many people into the funnel as possible, but as many people into the funnel as possible who are also relevant.”

Then, italist nurtures and retains those leads with email, organic social, and even channels usually geared toward top-of-funnel acquisition, like influencer marketing.

“I’m a big proponent of working more on your existing relationships rather than always trying to go out and find new ones,” English says.

And his strategy actually shows that it’s a false binary: You can drive acquisition and retention at the same time.

The false binary of retention vs. acquisition

The current marketing landscape makes retention look like ecommerce’s next big growth frontier.

Customer acquisition costs have recently skyrocketed because:

  • People are shopping less. Many consumers are reining in spending to prepare for a potential 2023 recession.
  • Apple privacy updates tanked paid social. Digital advertising is less efficient than it was pre-iOS 14.5.

And italist has extra acquisition friction to contend with, as well:

  • Competition is spiking. italist’s niche has gotten twice as competitive since 2015, English estimates—which drives up the price of reaching their target audience.
  • italist sells at luxury price points. A discounted Dolce & Gabbana bag on italist can still cost more than $1K—not exactly an impulse buy!

“If people have a good experience, there’s no reason that you can’t continue to attend to those relationships,” English says. “We already have those profiles, we already have their information. We don’t have to pay for them again.”

But retention isn’t enough on its own. Churn is inevitable—which means a steady supply of new leads is still essential to a healthy funnel.

But retention isn’t enough on its own. Churn is inevitable—which means a steady supply of new leads is still essential to a healthy funnel.

So English has prioritized lead quality over quantity, with a focus on customers with two seemingly conflicting traits: a love for high fashion and a love for discounts.

“There’s a lot of people out there who don’t really care about getting a discount,” English says. “That’s not our customer.”

Once these leads enter italist’s funnel, ongoing nurture is key to getting their first conversion—and maximizing their lifetime value.

In English’s role at italist, he nurtures leads new and old with the same unpaid channels and tactics.

Email marketing as a “power retention tool”

Email is the “power retention tool” at the heart of italist’s growth strategy, English says.

This wasn’t always true. 3 years ago, when italist first implemented Klaviyo, the software’s built-in benchmarking gave them tough news: Their open and click-through rates were subpar.

The root cause? Mass email blasts to (nearly) their whole list.

To address the issue, English implemented more segmentation and added more automated, behavior-triggered flows.

He now sends to hundreds of different email lists, segmented by demographics, activity, and referral source, and email performance has improved drastically.

He now sends to hundreds of different email lists, segmented by demographics, activity, and referral source, and email performance has improved drastically.

italist’s total list size has nearly tripled in 3 years, and their open rate, click-through rate, and email-driven revenue have all grown, too.

English explains that he uses email at italist in two main ways:

1. To drive first-time conversions

With an average order value around $600, italist can’t expect new leads to buy on a whim. The email program constantly nudges subscribers to give the marketplace a try.

The tactic English has found most effective for converting new leads, in particular: highlighting positive reviews in email campaigns every 6 weeks.

English has found that the most impactful reviews have a narrative arc, from uncertainty to evangelism.

English has found that the most impactful reviews have a narrative arc, from uncertainty to evangelism.

“They’re like, ‘At first I was skeptical and now I had my experience and I’m a converted person,’ or ‘I was a little unsure, but my experience was great and I’m super satisfied,’” English explains.

This type of review tends to outperform flatly positive reviews, like “This is amazing!”

To give the reviews extra credibility, English includes the reviewers’ names in his emails, with links to their original reviews on Better Business Bureau or TrustPilot.

“That encourages a lot of first-timers,” English says.

2. To ask existing customers for feedback

This is a practical necessity—English needs reviews for his review round-up emails. But it’s also a retention strategy. “A lot of people like to feel like they have a relationship with a retailer,” he says.

Asking questions about customer experience shows that italist has invested in collecting and acting on their feedback. In other words, customers feel like the brand listens—and cares.

To build stronger customer relationships, italist sends out a lot of automated, personalized surveys. For example:

The least-engaged customers, who don’t buy or open emails, get a win-back flow asking what’s wrong. If they reply, they’re entered to win a prize.

“We get tons of people who reply to that,” English says. They might talk about financial hardships, mention a product or designer they can’t find, or flag tech glitches in their country.

English reads all the flow’s replies, and estimates that he forwards 50% of them on to other teams in the company.

Recent buyers get asked to rate their experience and leave a public review. Anyone who leaves a 3-star review or lower gets routed to customer care, English explains—but that’s a rarity.

On TrustPilot, italist averages 4.5 stars across 2.2K+ reviews.

“People will not review you in a positive way on their own,” English says. “You have to really ask people to review you.”

That’s backed by industry-wide data. According to an analysis of 100K+ online reviews from Northwestern University’s Spiegel Research Center, prompted reviews from verified buyers are more positive on average (4.34 stars) than unprompted reviews from anonymous users (3.89 stars).

Source: Spiegel Research Center

Plus, reviews from verified buyers, with a “verified” badge, are viewed as more credible and drive more revenue. The same study found that consumers are 15% more likely to buy after seeing verified reviews than unverified ones—also known as “anonymous reviews” because the writer’s purchase cannot be confirmed.

Not requesting reviews is leaving money on the table.

Recent buyers with social followings get invited to italist’s ambassador program—a fresh spin on influencer marketing that really deserves its own section.

Influencer marketing with real customers

On ecommerce Twitter, there’s an ongoing debate about TikToks and Reels: Does scripted influencer content really work?

  • Pro: It’s predictable. It’s easy to produce a set amount of paid, scripted content on a set timeline. Unpaid, spontaneous fan content—not so much.
  • Pro: It taps into authentic fandoms. You can pay influencers with major audiences—like Doja Cat and Kim Kardashian West—to participate in scripted campaigns.
  • Con: It’s expensive. Scripted content is pricey. Play your cards wrong, and you can pay $5K for a post from a creator with no following. Meanwhile, organic user-generated content: free.
  • Con: It can come off inauthentic. Sometimes it’s a stilted delivery, and sometimes the product doesn’t fit the influencer’s depicted lifestyle.

For italist, scripted influencer content just hasn’t performed that well. On social, enthusiasm from actual customers resonates more.

“It’s always easier when we start from a place of people who already know us and like us,” English explains. “The messaging and the storytelling is a little bit more organic and believable, rather than some random attractive person. That doesn’t ring true anymore.”

It’s always easier when we start from a place of people who already know us and like us.

The messaging and the storytelling is a little bit more organic and believable, rather than some random attractive person. That doesn’t ring true anymore.
Alex English
italist

Another issue: italist doesn’t sell italist-branded products. It’s a marketplace for products from other brands. Actual customers have more success explaining the value prop in a short-form video.

“It’s a little different than working for a cosmetics company and just getting the product and showing the product and saying, ‘I love this product,’” English says. “It’s a slightly more nuanced conversation.”

So when English and his team get cold inbound pitches from influencers, they usually pass. Instead, they mine italist’s existing customer base for influencers—or, as italist prefers to call them, “ambassadors.”

English scouts for people who have bought from italist at least once. Those people receive an automated email flow, encouraging them to apply to italist’s ambassador program.

Perks of participating include:

  • A private discount code, just for them
  • The opportunity for their followers to enter a sweepstakes for italist site credit

You can see the program in action here, in this outfit-of-the-day post:

Source: Instagram

And here, with this unboxing clip:

Source: Instagram

In both posts, the enthusiasm shines through, even in the audio. (Sound on!)

Working with creators who already bought from italist on their own has “helped us grow our community at a lower cost” than they could have working with more popular influencers with less connection to italist, English says.

Core to the program’s efficiency: It merges top-of-funnel marketing—a social media awareness play—with retention marketing.

Core to the program’s efficiency: It merges top-of-funnel marketing—a social media awareness play—with retention marketing. Inviting customers to the ambassador program helps italist build deeper, longer-lasting relationships with its fans.

Who’s not going to make a second purchase after they get a personal discount code?

Organic social as a two-way conversation

italist has a presence on all major social platforms—Instagram, Facebook, Twitter and TikTok—but Instagram is its pillar channel, with more than a quarter million followers: 276K, to be exact.

On Instagram, italist blends:

“We’re pretty big on having social be a two-way conversation with customers,” English says. “So we actually do a lot of reposting of people that tag us, or people that buy something and then show it off on social media.”

The desire to look like supermodels drives plenty of fashion purchases—and italist makes customers feel even more like models by spotlighting their faces on the brand account.

In this way, italist makes organic social not just a top-of-funnel tool, but a key component of the customer experience. Their Instagram blurs the line between customer and model, between UGC and branded shots.

Source: italist Instagram

This transforms the aesthetic of the overall grid into more of a collage than a slickly standardized display. To English, that’s a good thing.

“We aren’t so concerned with it being a narrow aesthetic,” English explains. “It’s more wide and a little bit messier, in a good way.”

To 1M subscribers—and beyond

So far, English has found creative ways to merge top-of-funnel and bottom-of-funnel marketing:

  • The same emails that nudge new leads toward purchase bring existing customers back to the check-out line.
  • The ambassador programs and organic social posts that boost brand awareness also make current customers feel valued. And famous.

Going forward, English wants to optimize and grow italist’s email program even more.

Part of that will be localizing email flows for different countries. “We serve every market, but we don’t have every market covered in terms of marketing and messaging in the local language,” English explains.

italist just finished localization efforts for Japanese speakers. Next on the docket: content in Korean and Arabic.

italist just finished localization efforts for Japanese speakers. Next on the docket: content in Korean and Arabic.

These translation efforts should help with another piece of email optimization: doubling italist’s email click-through rate. English also plans to work with an agency to A/B test more varied designs and copy.

Ultimately, English sees email as a huge piece of italist’s marketing machine. Literally: They might hit 1M subscribers by the end of the year.

“Q4 is always the big one,” English says. “Every year, it gets better.”

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Mae Rice
Mae Rice
Mae Rice is an editor and writer covering marketing, tech, and the ways they intersect. She lives in Chicago.