Actionable data is key for wellness products retailer Ned.
Ned launched its ecommerce site HelloNed.com in March 2018, selling mostly cannabidiol-related products, or CBD, such as hemp oil and body butter. That first year was mostly about finding its footing, making mistakes and learning from them, co-founder Adriaan Zimmerman tells Digital Commerce 360.
After about a year, Zimmerman realized that Ned had a lot of data about its shoppers—such as average order value, conversion rate, how they landed on the site, among other metrics—but the retailer struggled to understand how all of the pieces interacted and impacted the other.
The retailer decided to implement big data management platform Yaguara, which allowed the retailer to take its data that lived in separate areas on its Shopify ecommerce site and put it into one platform. Ned went live with the platform about 10 months ago.
“Yaguara has really played a big role in bringing clarity into our data and allowing us to make it actionable,” Zimmerman says.
For example, the data platform can attribute a customer lifetime value score to shoppers factoring in not only how much they spend with the retailer over time, but also the cost of acquiring the customer in the first place. For example, Ned will track if a shopper learned about the brand through a podcast ad, then went to HelloNed.com and purchased a product using a coupon code specific to that podcast. Then, if that shopper continued to purchase once a month for the next three months, that means Ned attained a valuable customer through that podcast. In turn, the retailer could then justify spending more money on ads with that podcast to acquire customers, if it knows that in the long run, those shoppers will be more valuable.
Before this software, it would have taken the retailer longer, if at all, to observe in its data that these shoppers coming from a particular ad platform were more valuable because of their repeat purchase rate, Zimmerman says. Ned may have chosen not to advertise with an ad platform because the number of shoppers purchasing after hearing or seeing the ad did not meet its expectations, regardless of customer lifetime value, Zimmerman says.
“A year ago we would have walked away from it, moved on,” Zimmerman says.
Now, Ned employees can log into the portal and view how each of its ad platforms is performing in regards to customer lifetime value and make decisions based on this data. The platform makes it easy to understand and ultimately makes its team more efficient, Zimmerman says. For example, an employee can login and see if the money it spent acquiring a customer with a YouTube influencer, resulted in that shopper making repeat purchases, or if it lost money acquiring that shopper.
One downside, however, is that to get these lifetime numbers, it takes a few months for the platform to receive and analyze the data, he says.
“We don’t have the cash on hand to hire data scientists to make sense of all of this,” Zimmerman says. “A tool like this simplifies it all for us, and it fits well with us as a business.”
Yaguara took a few months to implement and costs less than $1,000 each month, Zimmerman says.
A shift in strategy to memberships
Another trend that emerged in its data was just how valuable subscribers are, as they account for 35% of its monthly revenue. Having a number clearly point this out made the retailer pivot its strategy to focus on acquiring subscription shoppers, Zimmerman says.
“I’m not breaking news for anyone, but it’s just the metrics that allowed us to determine how much time and money we would be spending on this greater membership piece,” Zimmerman says.
As a result, the retailer for the past 10 months has focused on redesigning its ecommerce site to highlight the value of subscribing to its products, which then convert the shopper to a member. For example, shoppers that subscribed to an order, or sign up for recurring shipments, receive 15% off and free shipping. They also have access to a wellness consultant so they can ask questions about their lifestyle and wellness.
The retailer plans to have a message on its product pages and will have the default option to subscribe to a product instead of a one-off purchase.
Currently, the retailer has just fewer than 1,000 members, but it is hoping to increase that to 2,000 in the second quarter after the relaunch of its site.
COVID-19 impact on sales for Hello Ned
While the coronavirus pandemic is upending many retailers, Hello Ned is not one of them. A few things are working in its favor, Zimmerman says, including being already set up as a direct-to-consumer retailer and not being tied to physical retail stores.
In addition, its products are about stress reliving, which more consumers are looking to do during these uncertain times. Plus, it had its 2-year anniversary sales, which resulted in its best sales day ever “by quite a bit,” says Zimmerman who didn’t reveal specific figures.
“We had our strongest month ever in March—by miles,” Zimmerman says.
Overall, HelloNed.com’s sales increased 700% in 2019 over 2018, and that trajectory has kept up in 2020, Zimmerman says.Favorite