How We Decreased A Hair Extension Brand’s CRM Costs by 67% While Increasing Revenue

Jodie Fraser, Marketing Manager at SWAY

Client Insights

SWAY provides award-winning luxury human hair extensions, styling tools, and haircare at affordable prices to salons and individuals. We kickstarted our work together in May 2022 and have had a tremendously positive experience. Our scope of work included automation strategy and setup, lifecycle segmentation, and SMS integration to SWAY’s CRM toolkit.

The Problem

At the start of our project, we diagnosed clear gaps in SWAY’s email automation setup, primarily focused on the post-purchase experience. In addition to that, we saw low-hanging fruit in their existing automations, and room to introduce SMS in a more cost-effective way.

Besides that, we saw a three-fold opportunity in the brand’s subscriber profiles. First, lowering the brand’s costs by carefully sunsetting lapsed profiles. Secondly, driving higher campaign performance by optimizing segmentation. And thirdly, segmenting B2C (retail) and B2B (trade) profiles to enable meaningfully different content and promotional approaches.

To amend the situation, we focused on 3 key steps.

• Creating and setting up cohesive lifecycle automation strategies for B2C and B2B clients, including a first round of (ultimately, successful) split tests.
• Performing a deep cleanup of the brand’s account and optimizing the SMS channel’s cost structure, resulting in significant monthly cost savings.
• Updating the brand’s segmentation strategy, setting the team up for greater campaign revenue, email engagement, and the ability to send meaningfully different content to meaningfully different segments within their audience.

Our Process

Lifecycle Automation Design & Split Tests

We have a systematic, 21-point lifecycle diagnostic tool for identifying automation opportunities for an online store, covering areas like: Automations for prospects, new customers, repeat customers, retention flows, re-engagement flows, retargeting flows, experiential flows, and more.

This diagnostic tool gives us a baseline understanding of what a brand might miss, which we enrich by deep diving into the brand’s unique context, understanding strategic priorities, and analyzing CRM behavior and data.

In total, we designed 18 bespoke automations for SWAY, with distinct user journeys for retail and trade clients, including SMS when appropriate, plus an additional 5 user-tagging automations, to flexibly allow the brand to include or exclude subscribers from our manual sends, depending on where they were in the lifecycle.

Furthermore, we set up timing, and content split tests in the brand’s highest traffic flows, identifying quick wins and rolling out new winners within weeks of starting.

Lifecycle Segmentation

One of the most common issues we observe is that brands use static lists instead of dynamic segments to target their campaigns. This is an especially risky practice, as a static list will naturally grow less engaged over time, lowering email engagement, potentially causing issues in deliverability, and, importantly, creating a confusing view of the database, where it is hard to tell who should receive what campaign.

In contrast, a dynamic segment is always up to date, as subscriber profiles automatically fall out of the segment once the conditions that brought them inside it are no longer true. SWAY’s final segmentation strategy allowed the brand to target users in different stages of the lifecycle, differentiated between retail and trade customers, enabled targeted cross-sells, and was created in tiers to enable to brand’s team to seamlessly pick the appropriate segment depending on each message’s importance.

All of this was done with clear, intuitive naming conventions, allowing all stakeholders to have complete clarity on the database.

Deep Account Cleanup & CRM Cost-Structure Optimization

Once the database’s segmentation was complete, we knew exactly what profiles we should attempt to re-activate and which profiles to sunset, both at the retail and trade level. In addition to the regular account cleanup process, we created lifecycle sunsets, meaning automations that dynamically identify users whose engagement is beginning to lapse across the lifecycle, activating them back or marking them for suppression.

Lastly, we adjusted the brand’s SMS credits and brought them down to a more appropriate level that matched our CRM strategy update. These 2 steps resulted in a 67% reduction in monthly CRM costs while increasing revenue.

Is This A Happily Ever After?

This is just the start. Despite our success so far, we’re looking forward to collaborating with SWAY in 2023. That’s because we’re perfectly aware you can always continue to drive bigger learnings and financial wins. It’s what we strive to do for every single one of our clients. Just like we could, potentially, for your brand too. 

Getting started is easy. We’ll have a short, no-obligation call to meet each other. If we’re not a good fit for whatever reason, we will refer you to an agency that can serve you better than we could. If we are, we’ll start with a quick audit of your email program. If you’re thrilled with the results of that audit (experience shows you will be), we’ll sign you up for a monthly retainer and start implementation right away.