Among the DTCs, Zappos is a certified OG. Back in the day, the shoe brand made its name with legendary customer service. But it also pioneered key aspects of the e-commerce user experience. In fact, at next week’s Data and Programmatic Insider Summit in Tahoe the company's head of marketing insights and customer research, Alex Genov will share how the company now uses data and insights to redefine CX as much more human and individualized. But another aspect of the Zappos marketing story caught my eye recently, the return to print. You can listen to the entire podcast at this link.
Like a number of DTC brands, Zappos rediscovered the power of the oldest form of direct-to-consumer commerce, the mail order catalog. Zappos is mailing out a traditional back-to-school print catalog. To discuss the back-to-school initiative generally, and drill into the revival of direct mail, we have the Chief Marketing and Merchandising Officer at Zappos, Joe Cano.
MediaPost: How does Zappos and e-commerce generally experienced the back-to-school sales cycle? Is the cadence, customer journey, etc. different here from traditional retail?
Joe Cano: The great thing about being an e-commerce retailer, especially in back-to-school, is that different school systems and some states go back to school at a certain select times. Like in Las Vegas, we’re already back to school now. So, shopping would have been done probably earlier in July. We take the data analytics and what area is being pushed for that specific timeframe and then geo-target those customers as well. Overall, we use data and geographic data to see when is that customer spiking, what categories are spiking during that time as well, and weave that into our entire plan going into July to the end of August.
MP: Now, do you see the back-to-school cycle for a company like Zappos as a customer acquisition opportunity?
Cano: We've actually had a little more of an increase in customer acquisition for brand new customers in the back-to-school timeframe. And part of that, I think, is because we have the catalog. Most online retailers don't usually do something in print. They focus mainly on product listing ads, Google searches, branded term searches, all of those things, and that arena has obviously gotten very noisy. Print is something that I'm excited about. We tested it out in 2019; it did very well. This is kind of the first year, where things are a little more back to normal. We decided to launch that in the middle of July and overall, it's been great. Some of the early reads have been really, really positive. The vendor community has been really excited about it as well.
MP: On the creative side, did you come into the print space with a particular theme in mind? And when a DTC brand, with all of its focus on user experience online and data, does it come into print with a different sensibility than traditional retail?
Cano: At Zappos, we obviously always try to make sure that our brand partners are happy and excited with what we're showcasing. The one thing that I wanted to really bring to light in this catalog is a lot from our head of creative as well as bringing back some fun nostalgia. Back when I was growing up, we'd love to get the print catalogs. You'd circle things, give it to your parents, say, here's what I want. I think, in the age of almost this screen overload, it's nice to take a step back.
So overall, we kind of tried to bring back nostalgia, kind of back to the 90’s. Next year is our 25th anniversary, so this is our first little touch into kind of bringing back some nostalgia for these older millennial parents, who are our core customers. Putting in fun things like games and crosswords, and putting even a shoe sizer, because I've got about 15 nieces and nephews, I’m from a very big family, I never know what shoes to buy for my nieces and nephews as well. This is a very easy way for them to say, all right put your foot on this page right now. And we're hoping they actually keep that so they can consistently measure their kid’s foot. Depending on what stage their kids are at, you might need new shoes every three to four months. So that's something that's huge for kids.
MP: Let's talk about some of the technologies you've discovered here, because it is always surprising me how sophisticated direct mail has become. What sort of segmentation and targeting were you using, what tools and levers were you pulling here?
Cano: We separated out into a couple of different groups. One, we separated out into the group of customers that we know purchased with us every single year and wanted to make sure that we're grabbing some of their wallet share from the back-to-school spend. And then we took a look at some of the customers who maybe had lapsed for us, who hadn't purchased for us for over a year to two years.
Once you get them back, knowing that they had kids in their household, we marketed to them as well. And then also throughout this catalog there are QR codes, so that's an easy way for us to track when someone goes directly into the site, shows the entire landing page as well as all the brands. But at customer segmentation we looked at both our customers that are tried and true, our customers that shop in laps, and we also took a look where do they live, what type of style do they actually need. Most of our consumers are in that more casual space as well. So, you're not going to see anything like suits or uniforms in here. For the most part, it's going to be just more fun exciting fashion moments. And as we've seen what our consumers were actually gravitating towards with the rise of TikTok and Instagram and all these kinds of social posts. Now, you see kids as early as eight to nine [years old] wanting to have their own fashion sense, have their own fashion style. So, we really focus it on some of those brands that are kind of fun, exciting, that we know we're goanna be cool within this timeframe. And so overall, that's what we're really focused on and put in here.
We have three different types of catalogs to specifically send out to different areas. We utilize this as what are going to be the brands that they're going to be gravitating towards. And then we actually potentially might do a baseline catalog and then have fast follow up little mailers. If we know that customer is someone that likes more brand focus, someone that wants more comfort focus, someone that wants more adaptive focus as well. So, there's other things that we're going to be testing out in this next year to make sure that we're really homing in on personalizing the mailer, which I don't think a lot of people are doing right now. So that's something I'm super excited about.
MP: You mentioned that you tested this before. So even though I know you're still in the middle of this campaign, you have some metrics from the previous tests. What are some of the things that impress you about how this performs?
Cano: I think the biggest metric that I saw was the basket size grew about 25% with people that actually got the catalog because they bought multiple items. And that’s what we really want to see here. So, another thing we learned from our first catalog, which was a little bit larger, customers gave feedback that this was maybe a little bit too big, and it was hard to kind of piece through. But customers really wanted to see the exciting brands they know and love. So, the catalog is filled with things like Steve Madden, Vans, New Balance, Hoka, Birkenstocks and Asics. We’re focusing on the best of the best, knowing that kids will kind of explore, maybe do some color multipliers of it as well. So overall what we really saw was basket size was higher, which is great, obviously for a profit, great to see customers are actually buying multiples of things, and then also really making sure that we're showcasing the correct brands to them. So those are some of the learnings that I gleaned from it. As of right now, the basket size is continuously actually going up. So, people that are coming in through the catalog QR code their basket size is about 30% higher than what our regular basket size is. Now, if you look at kind of total back-to-school to back-to-school, usually that is very indicative, because people buy multiple things, but this is even higher than our regular back-to-school, which is really great to see. So overall, it's proving out to be pretty successful. Obviously, we've not hit the peak of back-to-school just yet. It's kind of happening, next week is the high watermark. So, I'll have some more data then, but the early reads are very positive.