The only KPI a retention marketer should be thinking about..

The first thing that you need to do as a brand is figure out your actual medium time between your first and your second order. Don't guess at it.

The job of the second purchase window isn't to sell another unit. The job is to help the person cross that trial into identity mode.

Ultimately, a good chunk, like a large majority of first-time buyers will never, ever come back. The likelihood and the probability that they make the third does increase dramatically.

Give them a gentle reason to come back sooner without anchoring their brand to wait for a sale. So if you use a discount here, make sure you're using it more like a one-time thank you, not the new price that they're going to set.

From the open to the click, they're the masters of the flow. Just watch your list grow and your leads turn to go. Did we retain you so far, or do we have to extend it? If you want results, you know you gotta send it. Yeah, you know you gotta send it. Yeah, you know you gotta send it. Yeah, you know you gotta send it.

What is up everyone? Welcome back to Send It, where we discuss anything and everything retention marketing specifically. in email and SMS marketing and e-commerce. My name is Jimmy Kim and I'm here with my co-host.

Chase Diamond.

So Chase, today I think we want to go deep on what I genuinely think is the most important moment in the entire customer, like, lifestyle cycle basically. I want to open with a number that most brands are pretty proud of and I think it's the wrong number to be proud of. And I think that thing is called the new customer. Look, the reality with every brand is that everybody celebrates the whole new customer count, It's on the dashboard. It's in the Slack messages. It's when everyone gets really excited because they had a record acquisition month. But the problem with this is very simple. A first-time customer, and I say it isn't really a customer, it's really just a buyer. It's someone who's willing to give you a chance. That's it. They want to try you one time. And there's usually no loyalty behind it. There's no habit built behind it. And statistically, as we know in D2C, most of them are never coming back. So When you celebrate the number in isolation, you're celebrating the most like fragile number in the business, the least valuable version of the relationship you'll ever have with what you consider a customer.

Yeah, and the brutal part is like they paid the most to get that exact person, right? It's like your customer acquisition cost is the highest on the customer who's frankly going to be like the least likely to be sticky. And I think that's like kind of the tension right now of D2C, like in a nutshell. You know, we've done episodes essentially on like the first 45 days. We've done welcome series, we've done reactivation, right? All that. You know, today sits kind of right in the gap between all of those types of episodes we've gotten to. And it's really going to be like the bridge and the lifeline for someone bought once to someone is truly and actually a customer of your DTC shop. And I think it really does deserve this full episode because The difference between a single order and a, you know, 2 orders and beyond, you know, that's like the biggest drop-off in the entire funnel that everyone listening to this is going to have. And very few people are actually spending their time and energy there.

Yeah, that's well, that's well positioned there. So today, the number nobody puts a confetti on, which is what we call the second purchase, because it's the moment when the stranger becomes a buyer and almost every brand has You know, they look asleep at the wheel right at the point when it matters most, in my opinion, because look, we all understand the psychology and we understand what, you know, how to get to that first sale, but what's actually happening in that window, the timing, the actual playbook, that's what we want to fix in this pod today. So let's start with the why, and this is like the whole game. So Chase, you want to kick that off?

Yeah. So let's talk about like the math here, because I think once you see like the economics and kind of the shape of it, I don't think you can unsee it anymore. You're not gonna be able to hide from it. And I think really like the classic finding that gets cited across every study you read is that repeat purchase probability compounds. After a first purchase, the odds a given customer ever buys again are low, not kind of low, but they're genuinely low. And depending on the category and the study that you look at, A good chunk, like a large majority of first-time buyers will never ever come back. But the moment that someone does make a second purchase, the likelihood and the probability that they make the third does increase dramatically. And if they do it, a third, fourth, et cetera, it continues to climb again. And the curve is quite steep and it bends hard to the right at that order 2 kind of threshold. And really what that tells you is that the customer relationship isn't this linear thing that a lot of marketers believe it is. You know, you don't earn loyalty a little bit at a time with each order. There is this threshold, and that threshold sits between that first and that second purchase. So if you can get someone across that threshold, you know, the entire lifetime value of that profile changes. And if you don't get them there, and then everything you spend to acquire them Basically, it's kind of like a rental if you think about it like that.

Yeah. Let me add something that reframes what acquisition even is because it's kind of the most of your first-time buyers will never return. We've kind of agreed on that. And acquisition isn't on its own growth. It's kind of like a treadmill. So you're spending more and more every quarter to replace the customer you failed to keep and you feel busy, but the revenue might fall flat or or it might be up ultimately, but the underlying business is leaking out of the bottom faster than you're pouring it on top. That's like the truth of most businesses.

Yeah.

And the brands that win aren't the ones that are best at acquisition. Everyone's acquisition is kind of roughly the same these days. Everyone's buying the same ad platform at roughly the same rising costs that are happening. But the brands that win are the ones that convert a stranger into a customer at a higher rate than their competitors. That's the actual competitive advantage. And it lives entirely in this, window that we call the second purchase.

Right. And there's a kind of a financial angle here that matters for the folks listening who need to report to like a CFO or like a board. Your customer acquisition payback period is directly tied to this repeat rate. So if a meaningful chunk of customers buy a second and third time, et cetera, that payback window and payback period actually shrinks. Your margins are going to improve and then you can afford to spend more aggressively on top of funnel than someone else who is only able to get that one and done purchase. So actually improving the second purchase rate isn't just a sole retention win. It actually funds your ability to go acquire at the top of the funnel, which creates this really beautiful flywheel.

Yeah, that's exactly what the executives miss. Ultimately, they treat acquisition and retention as 2 separate budgets fighting each other for every dollar, which is wrong in my opinion. They're not separate. The second purchase rate is the thing that determines how much acquisition budget you actually should have. And you fix the middle and both ends get better ultimately.

Yes.

So let's talk about what's actually happening in like your customer's head, because the tactics only make sense when you kind of understand that underlying psychology. And I think this is where most brands get it wrong. They treat the second purchase like a smaller version of the first, but it's not. It's a completely different decision. The first purchase, in my humble opinion, is often just like a trial. When someone buys that first time, they haven't really decided anything about you. They saw an ad, they clicked on it, the product looked good, and the price felt fair to them, so they took a swing. But the truth is, I don't think they're committed yet. In their mind, they haven't even chosen your brand. They're just trying one thing. And that's the emotional reality. And if your post-purchase experience treats them like a loyal customer, Well, you're talking to a relationship that doesn't exist yet. The second purchase is where the actual decision happens. That's the moment a person shifts through, I tried this, to this, I'm someone who buys this. And that shift is identity shift. It's not just a transaction. And look, when somebody buys your coffee, for example, for the first time and they've quietly started to think of themselves as a person who drinks your coffee, that's totally different psychology than let's just say they get their first order and they, you know, Then they state, you know, everything downstream from there depends on that decision. So the job of the second purchase window isn't to sell another unit. The job is to help the person cross that trial into identity mode ultimately. And that means the experience between the first order number 1 and order number 2 has to do 2 things. It has to deliver the promise of the first purchase, which is very important, but it also has to make the customer feel like they're Continuing is natural, basically, like the continuation, the obvious steps are next and not a new decision they have to negate from scratch again, but one that they've already made. Chase, you've been on Omnisend for a while now, right? You moved over from Klaviyo now a few years ago.

Yeah. And honestly, I put it off for the longest time because migrating sounded like an absolute nightmare. Email flows, SMS segments, forms, templates. Dude, it was a lot, and it's not exactly something you just knock out in an afternoon these days.

Dude, that's exactly right, because that's the part that people keep getting stuck on. Even when they know they want to switch, nobody wants to rebuild everything.

Yeah, and it's a lot, right? And that's why I love what Omnisend's doing now with their new migration. Switching over takes just 5 business days, and their team does a ton of the heavy lifting, which is fantastic. They help rebuild automations, segments, forms, templates. So you're not starting from zero. Plus, for my account, and I've seen other brands, they're saving up to 35 or so percent. It is really incredible.

I've experienced this myself. 5 days is an incredible feat. That's fast. And I know that they really got a system down because listen, the hardest part about signing up for a new platform isn't the price or anything else, though that's a nice benefit. It's that moving that Makes it really hard and making sure that stuff doesn't break, right?

Yeah, 100%. That was my big concern.

And you know what? What's really cool about Omnisend is that they've got a bunch of new AI stuff now too, right?

Yeah, we've been geeking out pretty hard with it. So they have their Omnisend MCP, which essentially connects Omnisend with ChatGPT or Claude. So instead of having to dig through dashboards and trying to piece together everything yourself, you literally can just ask questions, pull reports, check performance. and move way faster directly within Claude or ChatGPT.

Yeah, which is basically how people want to work now.

I think it's really going to be the only way to work now and in the future. And if you've been thinking about switching, especially if you're on Klaviyo, you do need to check out Omnisend.

Big shout out to our sponsor here. Go to omnisend.com and check out their migration page. We've got a link. If you sign up through our link, you'll get 30% additional off for the first 3 months on top of the savings that you'll have. But putting this off because it sounds painful Migration's hard. That's what they build for. And you should go check them out. Now back to your pod.

Yeah, for sure. And I think this is why, like, the post-purchase experience is so much more important than people actually give it credit for. You know, the difference between order 1 and order 2 isn't small, you know, and it's— it does have a lot of signals along the way. So essentially it's like, did the product show up when you said it would? Did it work like the ads or the emails or whatever the messaging promised? Did the follow-up feel like a brand that actually cared or a brand that basically got what they wanted because you made that purchase and moved on? So I think each one of these questions that you have to answer and understand is where the customer is essentially collecting evidence about whether they made a good or bad decision. And if they feel like they made a good decision, that second purchase gets so much easier because you've reduced their perceived risk of buying from you. And the whole reason often like the second purchase converts at a higher rate than the first is because the risk is now lower. You have that trust, you have that affinity, right? They know the product's real, they know shipping works. So your entire job in the window is to reinforce the risk is gone and that the decision they made was a great one.

But you know, Chase, there's a trap in here too, because I wanna name it, right? A lot of brands try to force the second purchase with this like discount. Or the second to first order ships ultimately. But, and I understand like as a marketer, this might be your first instinct, but if you think about what it does psychologically, right? You just told a customer who's deciding whether or not if you're worth it, that the product is worth less than you paid. You've anchored them to a lower price before they've even formed the habit. Now the second purchase isn't, I love this and I'm coming back often. It's, I'll wait for the next coupon. And you train that behavior you didn't want. which is where most brands are at the exact moment that they most are impressionable, basically.

Yeah, I think that's an interesting point, right? Like the window is essentially, I guess, like when the habit forms and like whatever behavior you reward is the behavior you get for the lifetime of that specific customer. So if you reward like a full price purchase driven by like a good experience, you're hopefully then, and you should expect to get a full price repeat customer. Whereas on the flip side, like if you were rewarding discount hunting, you are then going to get the behavior of a discount hunter for the entirety of their time with your company. So that second purchase does not just create a sale. It actually does set the terms of the entire relationship with, you know, whoever that subscriber and that customer is. So in terms of like the actual timing, because get the second purchase is useless advice without knowing when. And then the answer, right, really does depend on the actual category in which you plan or your clients plan because, you know, at the end of the day, it's going to be different. So every product has like this natural repurchase cadence. So for example, you had mentioned coffee a little bit before, you know, coffee might be like a 3 to 4 week time thing. You know, supplements, that's pretty straightforward because most of the time it's like a 30-day supply. So it's a little bit more predictable. Skincare, there is some predictability, but it could be 4, 6, 8 weeks depending on the product and depending on how you've trained and taught people to actually use it. Apparel's typically longer and a little bit messier because there's not like a said consumption cycle. A lot of it's like seasonality and desire-based, not because you're ever gonna run out of clothes. So at the end of the day, like The first thing that you need to do as a brand is figure out your actual median time between your first and your second order. Don't guess at it, but actually pull the data and look at it because the number is going to inform the majority and the entirety of like the decisions you wanna make around like your retention program. And then once you know that number, the window is going to appear and you're gonna wanna present that and build that relationship in the lead up to that natural reorder point. And if you're too early here, you're going to ask someone to buy something that they haven't run out of, they haven't consumed, they haven't finished. Or if you wait too long, it's going to be kind of this awkward follow-up, right? And maybe they had already gone elsewhere.

Yeah, that's a really good way to think about it. And I think this is where I think about replenishment cadence. Brands have massive advantage that they don't always use. If you sell something consumable, like a CPG product, you can almost always predict almost to the day when someone is going to run out. That's a pretty great gift as a marketer. You know exactly when you need to reappear. So failure there isn't a data problem. It's generally an execution problem. They have the timing handed to them and they still have generic newsletters instead of perfectly timed, you're about to run out message. That literally is the easiest hack that you can do. For brands without consumption cycles, I agree with you, apparel, accessories, home, The time is quite fuzzy, right? You have to lean on other signals such as things that we all look at, behavior browsers, engagement, seasonality, or even the anniversary of the first product, right? Or the first purchase that they've made. You're not waiting for them to run out because they never really run out. You're creating a reason and a moment ultimately. And that's just harder, which is exactly why those brands need to build a relationship in a window that's much stronger. And you can't rely on that need. So you have to rely on the connection ultimately. All right, real quick. It's kind of wild that we're already talking about holiday planning in July right now. Just like any other event, there's basically a conversation everywhere. People are already diving into BFCM planning, testing promos, prepping inventory, creative acquisition, the whole thing. And it makes sense because e-com brands, Q4 is when not only when traffic gets expensive, but it's when the traffic is the highest. That's why I find retention.com are super interesting right now. You're already paying to get more people to your site, but the most valuable visitors are still leaving without buying anything or joining your list. And retention.com helps you turn those anonymous traffic into opt-in email subscribers. So you're not just renting attention for the holidays, you're building an audience that you can keep marketing to after the season ends. And they've made it super flexible right now, which is huge. You can start for absolutely free, turn it on when you need it, turn Turn it off when you don't, and you pay as you go, which is crazy because everyone else is charging these big contracts. So if BFCM planning is already on your mind, which it should be, this is probably one of those places that you want to go check it out. Go check it out, retention.com. Go start for free. We'll take you back to your pod.

Yeah, exactly. And then the other timing layer here is like that the window actually has like phases. I think this is where like email and SMS kind of split their jobs nicely. It's like early in the window, right after that first order. It's really about like the relationship and the reinsurance. So again, I've talked about this before, like, did it arrive? Here's how to get the most about it. Here's the story behind what you bought. And that's really a great candidate for like sending emails because it's content and email gives you kind of the room to share photos, pictures, text in a way that's not so capped. And then as you kind of approach the reorder point, I think the job shifts away from like helpful reminder to more of like a nudge. And I think this is where like SMS is like a great place because, you know, it's immediate and it lands at the moment of like that actual true need. And if you are running both, which I assume most people are, you want them to be coordinated at the same customer timeline rather than firing on 2 kind of, you know, separate different schedules that don't know about each other, just feels kind of chaotic. And this is where like Omnisend, for example, makes life way easier because you actually build the email storytelling and the SMS nudge as a single sequence tied to each individual kind of customer-specific purchase timing instead of just like duct taping this tool plus that tool and hoping that they play nicely.

Yeah. And let me add to that, the worst version, right, which we constantly see is the customer gets the we missed you email or comeback text from the same afternoon, 3 weeks after They bought with like no coordination or story behind it. And to me, that's just a failure in retention program. That's 2 tools yelling at the same person coordinated off of one timeline that's entirely different. So, all right. I want to walk through some actual playbooks because I think that's going to help people move into the mindset of the second purchase. And I'm going to go through like 5 of them. So let me go ahead and I'll just take them in order and I'll let you kind of hear them out and see what you think. But here's what I think about when I think about this thing. Yeah. This is like the foundation that everyone sits on. It's a post-purchase sequence that actually earns the next order. Most brands' post-purchase email is like a receipt and then silence. And to me, that's wasted asset. The windows right after the purchase has some of the highest engagement you'll ever get from your customer because they're excited and they're a little anxious about the thing that they just bought and spent money on a credit card and to of course use it to solve their problem or whatever that might be. So this is your time to reassure them. set expectations, tell them how to get the most out of your product, and start the story why people stick with your brand. Like you're not selling them, you're building evidence that the first purchase was smart. You're giving them validation. That's play number 1. And if you get that wrong, nothing else really works in this playbook, right? So then you go into playbook number 2 or step number 2 of the playbook. And number 2 is like a timed replenishment or reorder nudge. It's mapped to a median time number based on what Chase, you talked about earlier using their data. And that is the single highest leverage message that the whole window of like consumable brands. If you land right in that right time when they're realistically running low, you might make that reordering as effortless as possible. One tap, no friction. You want to make that entire message, you're about to run out and here's an easy button because that's what people want. And if you're not a consumable brand, that becomes a little more like the complete the set. Here's what pairs with your bought message. I mean, these are timed well, but they realistically should be ready to move a little bit more. And that leads me to number 3, right? So now you've figured those 2 out. Number 3 is the cross-sell, which is something that I think a lot of marketers miss on, which deepens the relationship instead of just extracting more money. And it's, you know, the distraction— the distinction of what it is that matters. A good cross-sell in a window isn't some random you might also like. It's a logical next product that someone's buying if they bought that first thing. If they bought a starter, for example, You show them what makes the starter better, right? You're not widening the cart, you're deepening the commitment and guiding them to future, kind of further into your world, basically your store. And if you do this all right, a second purchase is in a second category ultimately is one of the strongest loyalty signals that you can almost create because they're not a customer of one product anymore now, they're a customer of the brand and that's what you ultimately want. Which leads me to what I call like the number 4. Number 4 is like the bounce-back offer because if used correctly, this is where I want to be careful when we talked earlier about discounts. Ultimately, the bounce-back is an incentive that's earned and time-bound, but it's not a standing coupon. It shows up as like a thank you for your first order. It has a real reason, a real deadline, and critically doesn't have to be a discount at all, in my opinion. It could be a gift. It could be a next purchase, you know, gift with next purchase, or it could be like a free shipping or early access. It could even be a bonus really. But the point is to give them a gentle reason to come back sooner without anchoring their brand to wait for a sale. Like we don't want to create that habit, right? So if you use a discount here, make sure you're using it more like a one-time thank you, not the new price that they're going to set. Which leads us number 5. This really only goes to like the subscription and replenishment conversion, but for brands where it fits ultimately. If the person bought the same consumable twice, right? The second purchase moment is the perfect time to offer the whole Never think about an option. That's the subscription option. That's where it works, in my opinion. Your proven product, they've built a habit and they're coming back to buy. Why wouldn't you want them on subscription? Because it removes the friction from the decision that they've already made. And a mistake is offering subscription on the first order because there is no habit that exists. But if you offer it when the behavior is real, it converts far better. And ultimately the thing that matters most is the churn Is far less. What do you think about that?

Yeah, dude, that was great. I think like the thread running through all 5, and I want to make sure this is super clear for anyone listening and taking notes, is like, is that not a single one of these is blast a discount and just pray and hope. And you know, that's not the strategy, right? Every single one of the things that you talked about right now is either around like reducing risk, reducing friction, or how do you deepen and build out that relationship? And that really is at the end of the day, like the true mechanism of driving that second purchase. Frisk, it's basically friction, risk, and connection. And if one of the tactics that you're trying to think about and employ doesn't move at least one of those 3, I don't think it makes sense to mess around with. Hey, it's Chase. Got 30 quick seconds? We built something specifically for you. Jimmy and I together have over 20 years of combined experience in email marketing, and we finally put everything together in one place, and it's called Ecom Email Certified. I know it's fancy, but it's gonna be great whether you're brand new or running campaigns for 7, 8, 9-figure brands. It covers it all, you know, deliverability, AI, copywriting, design, strategy, SMS, literally everything. Has over 175 total modules. Totaling 25+ hours of content. Even has quizzes, a community, and you're gonna get a real certification. It's way better than college. Don't tell your professor that, but it is. And we've designed it to take you from beginner to certified expert. We're talking about the kind of marketer who actually moves the needle and drives real revenue. Check it out at ecomemailcertified.com. And now back to the pod. Yeah.

Yeah.

That's a great way to frame it. Risk, Friction, connection. If I'm building this from scratch, the filter, that's the filter for every message that I should be putting into the sequence, yeah?

Exactly. And then to kind of quickly close on like the measurement topic, because you can't improve like what you're not looking at, this is like where I see like a lot of brands, even brands that are doing quite well, kind of just proceeding ahead without all the info. And really here, like the metric that almost nobody tracks well is the repeat purchase rate. And it's specifically for that first to second conversion. And you want to measure this by cohort, not blended across like the entirety of your customer base, because when you blend everything, it's super easy for things to become hidden and therefore you to make wrong assumptions based off the data that you're looking at. So you essentially want to look at kind of the cohort of customers who made their first purchase. In a given month, and watch what that percentage came back for the second purchase, and how long did that take? And when you look at it this way, like cohort by cohort, you can actually see whether the changes that you're making to the window are working or not, because you're comparing like to like over time. And then blended repeat purchase rate can go up just because you had like a big acquisition month. Well, back you know you know a while back, and then those people are maturing. So whereas like this kind of cohort analysis actually gives you like this really truth around, you know, what's currently working for this specific thing that we need to optimize for. And then the second number is essentially like the time between the first and the second order, which again, I think we've hammered at this point, but it's worth watching as like this trend, not just as like a snapshot, because if that window does shrink, then you know that the program's actually working. And if it's growing, then there's something in the experience that's just not kind of hitting right with your customers.

Yeah, no, I definitely agree with you on the measurement, but there's another mistake that I see is that most brands are pouring 90% of their creative energy and testing into acquisition funnels and welcome flows. And then the post-purchase experience is something somebody set up 2 years ago and never touched. That's like the truth of it. Like most people are thinking it's the same 3 emails, there's no SMS coordination because It's on another platform. There's no real good timing logic. It's quietly deciding the fate of every customer you worked so hard to acquire. If I can get one thing across in this whole episode is that the post-purchase window deserves the same obsessive attention as your acquisition window because arguably more because the customer has already raised their hand, they've reached into their pocket, they've purchased something, and it costs nothing more to reach them again, right? And try. So you've already paid for them. The second customer or the second purchase is the cheapest, highest return of revenue in your entire business, generally the moneymaker. And most brands are leaving this on the floor because, well, it's not as exciting as that new acquisition campaign, right?

Dude, if I were to sum up retention in a single sentence, it would literally be less exciting, way more profitable.

Yeah, that's a good one. So let me go ahead and wrap this thing up because I think we're drilling the point home and I hope people who are listening to this pod really think about this. But the second purchase is where the strange Becomes a customer, like they're becoming a buyer to a customer. The odds of a 3rd, 4th, 5th, 6th order, all of them bend off that one moment. If you can get that person to get that first purchase into that second purchase and the psychology, and I'll keep repeating this, is trial to identity, not smaller repeat to the first sale, right? The timing is your median time between orders. So you have to pull that number. And the playbook is the risk, friction, connection, and never just about discount and a prayer. So if you do one thing this week, here it is. Go pull your first and second purchase rate of your median days between order 1 and order 2, just those 2 numbers, and don't build anything yet. Most brands have never even looked at that number, and I promise the moment you see that, you'll know exactly where the leak is and how to fix it first.

Love it, dude. It's that simple. Go find those 2 numbers. That's the homework. Curious what people end up discovering.

Yeah, very cool. So that's the episode here today. This is the second purchase problem. Go share this with your favorite founder, your executive, your boss, or your your teammate. Talk about that second purchase. Really start obsessing over it. I think it's where DTC is really heading, and e-commerce merchants are starting to realize that that matters more than ever, especially with the cost of meta going up. With that being said, thank you for tuning in, and we'll see you next week.

Cheers.

From the open to the click, they're the masters of the flow. Just watch your. List grow and your leads turn to go? Did we retain you so far, or do we have to extend it? If you want results, you know you gotta send it. Yeah, you know you gotta send it. Yeah, you know you gotta send it. Yeah, you know you gotta send it.