The Power of Direct Mail in E-commerce: An Overlooked Marketing Channel with Drew Sanocki, Founder of PostPilot

The Conversion Show

In this episode of "The Conversion Show," Erik Christiansen, CEO of Justuno, interviews Drew Sanocki, Founder of PostPilot. Drew has an extensive background in retail and shares his insights on how direct mail can be a game-changer for e-commerce businesses and explains the features of PostPilot, including segmentation, automation, remarketing, retargeting, and acquisition.

Erik and Drew discuss:

• The integration capabilities of Post Pilot with platforms like Shopify and Klaviyo.
• The concept of the discount ladder and the 30, 60, 90 plan.
• Optimizing retention, basket size, and conversion rates before focusing on customer acquisition.
• The key to effective postcard designs is treating direct mail like a Facebook ad.
• The shift in mindset regarding direct-to-consumer brands.

Watch the episode on The Conversion Show YouTube channel

Host: Erik Christiansen https://www.linkedin.com/in/erikc/

Guest: Drew Sanocki https://www.linkedin.com/in/sanocki/

Justuno https://www.justuno.com/

PostPilot https://postpilot.com/

Transcript:

Intro 00:00:05

Welcome to the Conversion Show, a podcast that's all about. You guessed it, conversions, everything that gets you to your goal, whether that's purchase, lead capture app, install content downloads, chat engagement, or demo requests. We're talking conversions hosted by Erik Christiansen, CEO and co-founder of the leading conversion optimization platform, Justuno. On the conversion show, Erik sits down with industry-leading marketers, e-commerce growth experts, founders, and entrepreneurs to chat all things conversion marketing. Be sure to follow the conversion show podcast to be notified when a new episode goes live. Like what you hear? Leave us some love with a review. And now here's your host, Eric Christiansen.

Erik 00:00:51

Welcome to the conversion show today. I'm really proud to have my guest, Drew Sanocki, who we go back ten-plus years and I encourage anyone listening if you're in front of a computer and type Drew Sanocki into LinkedIn and you're going to find a background that is is very well, what's the word? Diverse.

Drew 00:01:17

Long and boring.

Erik 00:01:18

It's well-versed. KarmelLoop retailer he's been a retailer himself he is now CEO of Post Pilot a direct-to-consumer postcards highly segmented which is what we're going to get into today. Very exciting. So let's welcome to the show Drew.

Drew 00:01:37

Thanks, Eric. It's good to see you again. As you said, we've known each other for ten-plus years. I remember when we took over Karmaloop you know, we got it out of bankruptcy. And one of the first things we did was put Justuno up. And that was probably 2014, 2015, just to reengineer the pop up. And they were amazed at how we went from, I don't know, we probably ten next to the opt-ins in a week back then.

Erik 00:02:02

Drew has always been a big supporter it’s very exciting. You turned that thing back around to 100 million, didn't you?

Drew 00:02:11

It was you know we got it cash flowing again and I think at its peak it was up around 100 million. But you know, for us, the big the big win was just to right the ship and then sell it to a strategic which we did.

Erik 00:02:28

So huge background and retail background and turning companies around Drew for years I was so always so impressed with he has this 30 60 90 day. What do you call it? Can you share with the crowd here 30, 60, 90 because this is always been ...

Drew 00:02:51

That came from private equity. I think it was like whenever you buy a company or acquire a company, you, the investors, all the board wants the 30, 60, 90 plan. And it's like, you might have a five-year plan for how you're going to grow this thing, but you have to show the team that gave you the capital how you're going to make significant changes in the first 30, 60, 90 days.

Drew 00:03:19

So everything sort of came from that. I mean it Carmelo up at auto anything we had these sort of well thought out strategic plans. But what the board really wanted and what what I have since learned they pitch their investors on or they have to update their investors on is like what what what are you going to do in the first 30 days?

Drew 00:03:38

You know, how do you hit the ground running? How do you get this thing cash flowing quickly?

Erik 00:03:43

It's the low-hanging fruit.

Drew 00:03:44

Yeah, it's always it forces you to focus on the low-hanging fruit.

Erik 00:03:48

And in today's market, there is still so much low-hanging fruit. And, you know, Drew had that years ago. It was, if I recall, it was the email. So, you know, sending a 30, 60, 90 day email to those segments and you're early on and, you know, segmenting your audience, your own channels with email. And I think what we're going to talk about today is where are we in that today?

Erik 00:04:14

And when we talk about customer lifetime value and we talk about other low-hanging fruit, Drew has uncovered a great one with Post pilot. And can you share the new way to do postcards and kind of your approach?

Drew 00:04:33

Yeah it's just Post Pilot started with so we do direct mail for e-commerce businesses our goal is to help more businesses unlock this channel to become more resilient businesses, right to diversify their marketing, to do everything from retention to acquisition through direct mail. I got the idea because I've always used it. So I've been in e-commerce for 20 years and as you mentioned, in turnarounds, we'd acquire a property or we'd take over a property and very quickly have to look for what's the low-hanging fruit.

Drew 00:05:10

A lot of that was on retention. The brands were doing retention well enough. They weren't re-engaging past buyers. And when you looked at the data, most of those past buyers, there's a very rich audience. For any marketer, we're not subscribed to email. So they had either never subscribed or who had had unsubscribed. So there's really only one way to get a hold of them is direct mail.

Drew 00:05:34

It's the only way you can get all your customers because the customers don't have to opt in. It was always very hard. The karma loop at auto anything, you know, you'd have to find a printer, you'd have to upload your designs. Attribution was a mess. Know there's a long lead time from when you decide to run the campaign to when you see the results.

Drew 00:05:53

And I said like, why can't it be as easy, as easy as email? You know, I want it to be like Klaviyo or, or send Lane or Romney send where you just log in and send. So, I built Post Pilot to do that. I actually acquired it from the developer probably in 2018 and we spent about a year on the product turning it into something like Klaviyo for postcards.

Drew 00:06:17

On the retention side, since then, the platforms evolved, so we've had to then remarketing retargeting and in our acquisition, you can do things like catalogs, you can do things like shared mailers to get the costs down. But it's all within the platform. And I think we timed it really well because in 2020, 2021, Apple comes out with iOS 14.

Drew 00:06:42

This makes Facebook really hard for a lot of brands. So I think the last ten years made us lazy marketers where you'd throw money at that matter and it would work and all of a sudden it didn't in 2021. So brands started realizing that they had to be marketers again, that they needed to diversify, their revenue channels.

Drew 00:07:03

And we were there in the Shopify App Store as the leading direct mail app. So it's just been a bit of a rocket ship since then.

Erik 00:07:13

It's fun. Retention has been a major word with the customer acquisition costs, Facebook, everything. And so we actually, you know, we have been hearing about mailers becoming more popular again. What's new with postcards or catalogs? You know, as you go to post pilot, you're doing segmentation, personalized mailers, what's present, what's new, what's hot?

Drew 00:07:50

What's new, I think, is the segmentation really it is it and automation. Maybe ten, 20 years ago, direct mail was you know, you you upload a C ISV to a printer and you send the same offer to everybody on that. CSP Well, now you can much, much like email. You can segment your customers based on what they purchased before and recency, frequency, and monetary spend, which is kind of how the catalog industry's always done it, but how recently somebody purchased the number of times they've purchased, the total amount they've spent.

Drew 00:08:30

And you can just automate these campaigns such that as customers or people fall into the various segments, the system will print and send a card, even if it's one card a week, right? So you can have your abandoned cart campaign cloned into a postcard. You could have a handwritten note go out to VIP customers every time they reach a dollar threshold.

Drew 00:08:55

You know, the total spend goes to a thousand. I want them to get the handwritten note, and then you can have your retention campaigns go to customers who haven't been around in a while that you want to pull back to buy again. So I think as a marketer, the possibilities are endless. It's all it's all within the app.

Drew 00:09:13

You just want to be able to segment and target. I think stepping back a little bit, you always want that sort of holy grail of the of the right offer to be in front of the right customer at the right time. And it can be on it should that should be on site and this wasn't a lead in just you know but it should be you know.

Erik 00:09:33

If someone wasn't paying attention, they would think they were you were talking, explaining the on-site experience of how it should be.

Drew 00:09:40

Yeah. But it's it's sort of like if I'm in a certain segment, if I am somebody who bought once and hasn't been around for 60 days and I'm due to buy again, you want to give me an offer, You know, it might be a discount. I might be like, Hey, you might also like this to purchase. I should get that same offer when I open my email, when I look at my SMS, when I check the mailbox or when I go on the site, you know, it should just be consistent.

Erik 00:10:05

Everything you just talked about, you know, you know, recency, frequency, monetization, you know, I laughed when you said, you know, the right offer at the right time to the right customer. Literally, my team, we wrote that down last week, you know, because people want they expect it to speak to them. And it's it's really refreshing to hear you talking about mailers the same way we're talking about the onsite experience here.

Erik 00:10:39

It just, you know, and it goes into old-school retailing.

Drew 00:10:44

Yeah, it goes back to really I mean, I learned it from Seth Godin, who wrote Permission Marketing, I don't know what, 25 years ago or something, but he just talks about the best marketing is personal and relevant. And if you increase that relevance, like what's going to increase the relevance, it's a personal offer that's like that's designed with you in mind.

Erik 00:11:06

So as we talk about the personal offering and it being relevant, we're talking about zero and first-party data. How are you as a company working with digital marketers, e-commerce managers to get that data into your system?

Drew 00:11:23

Well, on the retention side, I would say most of the brands have that data. You know, you've got the customer, you know, what he or she bought before and when, you know, in your transactional data, you know, his or her address, right? So it becomes very easy there to segment off of that stuff. You know, a customer bought this.

Drew 00:11:45:21

They might also like this customer hasn't been around in a while. Let's send her this other offer.

Erik 00:11:51

And so being in Shopify, that's you're obviously just connecting the app and you're able to access that data.

Drew 00:11:57

Sure. If you're on Shopify, we could have a native integration. If you're on Klaviyo, we have an integration there. You know, you can pull that data from a number of different sources. So I think direct mail is very similar to email on the retention side, It's different from email on retargeting and on acquisition where it's more akin to Facebook because there you can look at your existing data, and generate a lookalike audience.

Drew 00:12:24

So a brand new cold audience layer on top of it. Direct mail attributes, household spending has bought from a Walmart before and then you can get very targeted with your prospecting campaigns or your retargeting campaigns.

Erik 00:12:41

Nate Attribution has been a big subject of conversation and debate this year, especially with SMS marketing. How do you approach attribution with mailers? Is it unique promotions, or unique URLs? How do, how do you communicate that back the ROI in value back to your clients?

Drew 00:13:05

Yeah, this is something from, you know, you ask any CMO if you add up all the attributed revenue, this is typically like a ... If you add up all the attributed revenue from, you know, email, Facebook, Google, whatever, and it's like 300% of the actual revenue of the business.

Erik 00:13:21

It's like, you go on LinkedIn and see all these different posts “like we increased case studies, we increased their ROI.”

Drew 00:13:28

Yeah.

Erik 00:13:28

So everybody by 130% and they're like tenable.

Drew 00:13:31

Obviously every service provider out there is going to try to lay claim to as much revenue as they can. And PostPilot is no different, you know, but I would say realistically, as a CMO or CEO, there's an upper and lower bound in direct mail. You see the group that received your marketing campaign and then you see what they did on the site afterward so you can calculate a lift or on the more conservative side, you can measure things like coupon redemption.

Erik 00:14:09

Control groups.

Drew 00:14:09

Control groups, that's probably the gold standard is like, okay if you know you're somewhere between the customer ROAS and the coupon ROAS, like a holdout group, we’ll tell you exactly the impact of any promotion.

Erik 00:14:24

We were talking about control groups last week in terms of even looking at pricing differently, how to structure, how do you show the value of your own SAS company to your clients. That's a whole nother subject. But it's important for digital marketers to be able to report back to their team, their bosses, you know, and report to their CMO.

Erik 00:14:45

Hey look, here's some attributable revenue for real. And because we did a control group.

Drew 00:14:52

Right and I think really every service provider probably could do control groups, but they don't because the results won't be as strong as the ROI they claim to produce.

Erik 00:15:09

Different subject. Can I challenge you on something?

Drew 00:15:14

Yeah, go for it

Erik 00:15:15

Having studied environmental design and being a homeowner now and going to the mailbox and getting all the mailers, I'm going to give you the benefit of the doubt here not only because I see you do some sustainable work with planting trees and using good paper.

Erik 00:15:34

I'm all about getting less paper used. Now, if you can tell me, we send less because they're more effective because they're highly segmented, I'll help build your case.

Drew 00:15:50

Okay, That's interesting. From the get-go, we realize that direct mail uses paper. Right. It's and we've had some customers who are sensitive to that. You know, we try to offset it as much as we can. But it's it's the nature of the category. I think that you're printed on paper.

Drew 00:16:14

But to your point, you know, if you did a highly targeted mailing of our catalog alternative, it's called a catalog versus a 90 page catalog or whatever you're going to save paper. So yeah, if you're already using direct mail and using a catalog, we could save you paper.

Erik 00:16:36

Do you print on rice paper?

Drew 00:16:39

I don't know. I don't think so. There are some alternatives, like hemp paper. Rice paper, and we have explored some of those.

Erik 00:16:48

Well, you know, with consumer goods people talk about consumer responsibility. People do shop based off of environmental consciousness, Shopping Gives is another example. People want to shop with brands that support causes. I'm just curious, your approach your company's approach to that it sounds like not doing the big catalogs, it's as minimal as possible.

Drew 00:17:23

Yeah, recyclable paper offset the print jobs we do have and, you know, I would say by nature in our industry of e-comm, there's a lot of trees being cut down, you know, not just for the direct mail portion, but the cardboard for the shipping packaging.

Erik 00:17:51

Fair enough. Speaking of the postcards and designs, as I'm going through it, the designs themselves and the personalization, what is effective these days?