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In episode 112 of the Customers Who Click podcast I spoke with Axel Folz, Head of Growth at Lalo, a baby and toddler brand in he US, about how they’ve been scaling the business recently, particularly with issues around the new iOS updates, and low frequency of purchase (once you have a highchair, you don’t need another one).
It’s a matter of being strategic with where we’re spending our dollars, and understanding which channels are actually going to drive growth.
Making sure a channel works organically for you is not only a great way to understand that channel, but also to ensure that you’re not solely reliant upon paid acquisition. All marketing costs money of course, but there are definitely advantages in enhancing a channel with paid, rather than being solely focused on paid.
02:08 - 11:14 - Biggest Opportunities for D2C Growth - Lalo got funded around May 2021 and wanted to scale quickly. But Axel insisted on a strategic approach, ensuring that they fully understand channels and the opportunities available to them, rather than just hitting the button and spending.
So scaling paid media effectively has been huge for them, but they’ve also been making more of a focus on retention, and providing new products, and replenishable products to help build on customer lifetime values.
Understanding channels is particularly important for Lalo because their products are not impulse purchases. New parents take their time researching what they need, and what is going to be the best product for them. This obviously has an effect on paid channels such as Facebook, and you can’t always just be looking at direct conversion CPAs.
12:23 - 16:30 - What Big Challenges Has Lalo Faced? - Forecasting, and inparticular trying to figure out when they’ll fit that inflection point where organic and word of mouth are taking over from paid as their primary channels. They do a huge amount of market research to understand how customers found out about them, what their general industry understanding is, and use that to help forecast media spend.
16:41 - 31:25 - The Key Focuses for Growth at Lalo - Reducing friction, and improving conversion rates is a big focus for them right now. They’re focused on driving more and more traffic to the website and building their CRM list, but improving conversion rates is going to have a huge long term impact on them. How do they mirror the in-store experience online as much as possible, how do they get customers to reach that Magical Moment?
Customer experience actually sits within marketing at Lalo which is quite unique, and now they provide super quick responses and a great experience to customers via direct messaging and conversational SMS.
32:04 - 39:49 - Scaling Media Spend Efficiently - Shifting to Shopify 2.0 allows a lot more flexibility on-site, and is allowing them to build templated sections for landing pages so they can scale them quickly. They don’t have to build each page from scratch. This means they can much more easily test messaging, but also make sure the right type of messaging is in front of people when they land on the website.
They’ve also started using a platform called Black Crow, which ranks customers based on data points such as pageviews, products purchased etc and allows them to identify good and bad audiences.
40:01 - Who Would Axel Like to Take For Lunch in the D2C Marketing World?
Former VP of growth at Uber, now at Baker, he basically invented the term virality. He taught a class at Stamford and every student went and created a viral product.
Also Brandon Chu, he’s a VP of Product and puts really great content out on Twitter.
41:29 - Axel’s Must-Have Ecommerce Tools:
Google Tag Manager
Inquire Labs for post purchase feedback