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Matt Edmundson: Welcome to the e-Commerce podcast with me, your host, Matt Edmondson. Now, this is a show all about delivering e-commerce, well, helping you deliver e-commerce. Wow. Uh, and to help us do just that today I am chatting with Thomas Lalas about retention, marketing of all things. We're gonna get into that. Yes, we are.

We're gonna pick his expert brains. But before we do, let me invite you to stop on by the website eCommerce podcast net. Sign up for the newsletter. And all the show notes and links go to your webs, uh, go to your website. No, they don't. They go to your inbox, uh, automatically for free. And you can get that just by signing up, which I appreciate on its own is just really boring.

Right. It's the standard podcast newsletter, isn't it? Well, let me tell you, uh, we are jazz up. There's gonna be some extra content, some extra stuff in there. We're trying to make that newsletter a lot more, you know. A lot less lazy, uh, is probably the better way to put it, and, [00:01:00] uh, be a bit more creative with it.

So do make sure you sign up for [email protected]. Now let's talk about Thomas, a former military policeman, which if you are like me, makes me instantly think of Jack Reacher. Uh, he's turned scr subscription whisperer. Which I think is a great title, uh, and helps million dollar e-commerce brands keep their customers coming back for more when he is not slashing churn rates and maximizing retention for eight to nine figure brands.

This ex-academic and startup founder is tackling his most challenging role yet. Being a dad. Oh, yes. Thomas, welcome to the show, man. Great to have you. How are we doing?

Thomas Lalas: Pleasure being here. It is, uh, I'm really excited. I mean, you are such an amazing host. I can't wait for this conversation, so,

Matt Edmundson: oh, it's a flattery.

Gets you everywhere on this show, Thomas. I'm not gonna lie.

That straight out of the I, I, I'm, I, I don't, I'm not being, uh, rude, but it's, it's in the, um, how [00:02:00] to be a great podcast guest book 1 0 1. Just say really nice things about the host right at the start, and they'll like you

Thomas Lalas: or just be a great host and people will just naturally give you compliments. Well, and again, well

Matt Edmundson: done.

It's working. Let's, let's just change the topic of this show and call it Feeding Matt's ego. That's what we should.

Oh man. Love it, love it, love it. It's uh, it's great chat. You where about, I mean, it's. I'm in the uk. It's seven o'clock in the evening here. I've got a belly full of delicious food. Uh, whereabouts in the world are you

Thomas Lalas: Right now I'm in C Greece. I used to be in the uk, so it's nine o'clock my time. Um, and after that the baby's gonna call for, you know, to go to bed and I'll be there as a good day.

So, yeah, that's the last thing of the day, you know? Yeah. Interesting conversation with, uh, a fellow liver pullin.

Matt Edmundson: Yeah. Oh, you're a, you're a Liverpool fan.

Thomas Lalas: Yes, I'm a Liverpool fan and I used to live in Manchester, but I supported Liverpool. I didn't tell [00:03:00] anyone.

Matt Edmundson: Don't tell anyone. I was in Manchester last night.

Uh, and I won't mention the Liverpool gang 'cause we don't wanna talk about it, but I was in Manchester last night, uh, with a, my, a longstanding friend. We've been friend for 30 years and he happened to be visiting Manchester. So in Liverpool's, not that far. If you dunno, British geography from Manchester, it's like 40 minutes on the train.

So I caught the train into Manchester. Uh, he, I, he and I had some food just catching up. It was really great. And we found this pub called, um, what was it called? Something like the Stinky Cow or the Stinky Pig or something like that. Or the craft. I don't know. It something to do with pigs, I think. And it was great 'cause it had these booths and it was like a sports pub.

And in each booth that would seat six people at the end of it was a tv. So you got your own tv, so you didn't have that thing where people couldn't see the tv. So we sat and we had a, we had a beer and we watched the game and we left slow. Disappointed. Uh, but yes, it's just, it was fascinating watching a, a Liverpool game in Manchester.

The first time I'd done that, [00:04:00] they didn't

Thomas Lalas: kick you out. So that's a good thing.

Matt Edmundson: Yeah. Yeah. And they actually showed the game, which was also quite impressive. So, uh, you know, these, these, these things are also always awesome. Uh, so tell us, how did you get, and forgive me if I, if you're watching the video, ladies, gentlemen, I'm, I've got my cup of tea, uh, in my hand, which I'm drinking.

Vitamin mint tea. Um, how did you get into, uh, retention marketing? What was the story there?

Thomas Lalas: It, it, it's always because of need. Usually, uh, people, you know, share their, their origin story and it goes something along like, I have this problem and I want to solve it, so now I'm solving it for other people.

Yeah. For me it is more like a story of pain where I, I'm an ex startup founder among others. Mm-hmm. And, and I've, I've done the academic circle lecturing and I'm next military, but when I was in the startup world. I realized that we were growing, but acquisition was what was driving that growth.

Matt Edmundson: Yeah. But

Thomas Lalas: not retention.

Right. And eventually the startup collapsed [00:05:00] and I realized that we should have maintained the, the customers that we got. Yeah. And because of that, um, when I transitioned from being the offer owner, the startup owner, and become a service provider. I realized that this is a great place to get started.

Email, SMS, um, retention, uh, subscriptions, et cetera. Something I was already familiar with and, uh, I've made a ton of mistakes on. So I tried to fix that and eventually, in the last seven years in the e-comm world, I've kind of powered through the ranks of that retention industry. And, and some people consider me, you know, they call me a wizard, an artist, or like the best.

Uh, so I'll, I'll take anything they, they share me with, but I feel pretty comfortable in this world. And, um, I love digging into data and discovering patterns and innovating. Yeah. Connecting different services and different solutions in unexpected ways, uh, in order to get an edge over the competition.

Matt Edmundson: That's really good. I, I remember, [00:06:00] um. Oh, it would've been 20 12, 20 13, somewhere in there. So a little while ago we were running an e-com business that sold beauty products at the time. Right? And, uh, a friend of mine drew this sort of little triangle on a, on a piece of paper. Um, and in one corner he, he put price in another corner.

He put quality, um, and. In the other corner, he put service, right? So you got price, quality, and service. And he said to me, Matt, you can only have two. You can't have all three. In other words, you can't have a company that is really driving down, you know, giving really good prices, um, low prices to a quality product and deliver great customer service.

You know, the, the, the maths don't work. And so. When we were doing the beauty company, at the time, we were [00:07:00] a quality product at a low price. So our customer service was not great. Um, and so you had to go and get a lot of new customers, right? New customer acquisition was a big deal. I. Um, and I remember 2020 thir, uh, 2012.

I deliberately, after looking at that little triangle, Thomas, I, I said, no, we need to shift, we need to move from a, a sort of a low price, high quality product model to a, a quality product. Still keep the quality product, but deliver, um, quality service, which means our prices had to go out to be able to pay for the, the.

You know, the increase in customer service that we were about to do. So, you know what? We did this and I wish I could sit here and say that the day that I did that my business boomed. 'cause it didn't at all. Um, our sales fell for the first few months. Where I noticed it was the following year was we grew by over 20% and we grew so quickly because we started to get a lot of returning [00:08:00] customers.

And it took a little while for the returning customers to get used to the. Well for customers to get used to about, you know, this higher quality of customer service that we were trying to give and experience and so on and so forth. And then we got the, the returning customers back. So I am a big, big fan of this idea of retention, marketing in terms of, I, I know new customer acquisition is important.

It's not the topic of today's, uh, podcast. Um, but I'm a massive fan of retention marketing. I'm a massive fan of getting customers coming back time and time again to buy. 'cause it, it really helped us out, you know.

Thomas Lalas: Absolutely. And something that I hear over and over again from brand operators is that they want somebody to fix their retention.

Leaky bucket.

Matt Edmundson: Yeah.

Thomas Lalas: That's how they call it, you know, leaky retention. Leaky bucket. Yeah. And, and the point is that you spend all this money, all this effort to acquire a customer, so you have a CAC of. [00:09:00] You know, I don't know, 80, 90, $150 no matter, you know mm-hmm. Depending on what you're selling. And in order for most businesses to make their money back and break even, they, they need to have each customer to buy multiple types.

Matt Edmundson: Yeah.

Thomas Lalas: So that's why subscription is very important and retention is very important because they unlocks the, the true LTV of the brand.

Matt Edmundson: Yeah.

Thomas Lalas: Right. And, and when the competition is so fierce, you need to be able to afford higher CAC to get customers. Mm-hmm. That other brands can't afford to pay. Yeah. So that's why it's very important to focus on retention.

Yeah. Um, and I'm, and I'm seeing not, not many brands really pay attention to what's happening, uh, post customer acquisition. They feel that their job is done once they get the customer. Because you know what, with with, with media buying the feedback is instant. It's daily. It's, yeah, it is. Its momentary. You, you know exactly how the are performed, but with retention, you have to wait for a month to see if the person's gonna buy again.

So it's gonna, you [00:10:00] don't have real time retention. You, you need to wait for, you know, 28, 30 plus days. Yeah. And that is a low, uh, really slow feedback loop. So yeah, that's why I would, I would like for brands to focus on retention and think of the first two weeks post purchase as a part of a product. Not as an afterthought.

It needs to compliment the product, the experience, the ads, the website, and to educate the first time buyer mm-hmm. So they can actually stop having objections, regrets, um, to be, to be educated about the product, how it works, and to make it a part of the lifestyle. Yeah. So, yeah, a retention is not an afterthought.

It should be a part of the product itself.

Matt Edmundson: Well, absolutely, and I think it should be a big part of, big part of your marketing spend as well. I don't think it, it's just something that you go, or we'll just send emails and it's fine. I think you have to actually allocate budget, um, because you know, the leaky B bucket analogy, [00:11:00] um, there's a great phrase which I've used a lot recently, is you don't fix a leak in bucket by adding more water, right?

Mm-hmm. And so you, you, you just don't, and so it, it, it never sort of fixes it. And, and I guess the other. Truism about e-commerce is those were the deepest pockets when the most customers, right? So you, if you can, if you've got great customer retention, it means you can go higher on the cac, which means your new customer acquisition go, the whole engine gets fed.

Thomas Lalas: Yeah. You can reinvest the money back into growth if that's your goal.

Matt Edmundson: Yeah, absolutely. Absolutely. But you're right about retention, marketing or what you do retention wise. It's not like I can do it now and AB test it today. I. You have to, yeah, depending on your product and your product's lifecycle, you, um, you've gotta play a bit more of a long game, haven't you?

Yeah. So what have you, let's get in some tactics. 'cause I, I think, I mean, we can all agree with the principle and if, if you can't agree that retention market's important after the conversation, we've [00:12:00] just had hundred, I'm not sure how much, how much more this podcast is gonna help you today. Um, but it's one of those things where, um.

I think the majority of people go, yes, it's good. I get the leaking bucket analogy and I need to stop the leak. I, I, I, I, I appreciate that. Um, what are some of the things that we should be thinking about Thomas here in 2025 that maybe we're not, are we still missing the fundamentals or are there other things that we should be looking at because we've got those down?

Thomas Lalas: When it comes to retention, yes, we are absolutely missing, uh, like the plot on the fundamentals.

Matt Edmundson: Mm.

Thomas Lalas: It, it is a disaster, uh, mo more often than not, you know, it's, it's quite easy to go and check on Shopify what your retention looks like.

Matt Edmundson: Yeah.

Thomas Lalas: Right. Uh, and, and um, now we have two different categories. We have brands that have one time purchases and [00:13:00] subscriptions.

Mm-hmm. And brands that go subscription only. For me, I specialize on subscription only, and I think that's the smartest thing to do to create a powerful subscription offer and to prove to your customers that they need your product again and again, and remove any, any objections from their head. And the goal would be for them not to cancel while when you have one-time.

Products, the goal is always to sell as fast as possible. And there are so many opportunities for you to pitch again in a different way. That makes sense. There's not enough time to educate. Yeah. Yeah. You need to think about the next order, which you have to drive. So that's why a lot of subscription, um, first models, but it all starts with the offer.

The pro a bad product. A bad offer with bad economics cannot be fixed with a retention system. Yeah, because it just, the, the mouth is broken. Yeah, right. It needs to be a product that makes sense and it's something that [00:14:00] unlocks acquisition, something that people really want, but also something that people will keep wanting.

Matt Edmundson: Yeah.

Thomas Lalas: Uh, and usually there is a start kit. There is a great offer. The upcoming offers also matter because if, let's say there is an offer that includes a starter kit with a main product, a couple of freebies, free stuff. And then the second order is just the product by itself. And sometimes it's even more expensive than the first purchase.

By contrast, you're not gonna like, yeah. The second order. Or you might be tempted to get all the freebies that were offered to you upfront and then cancel right away.

Matt Edmundson: Mm-hmm.

Thomas Lalas: Because you just came the system. Yeah. But this is a customer where you've lost money as a brand.

Matt Edmundson: Yeah.

Thomas Lalas: It doesn't make sense for you to acquire this customer in the first place.

You want the customers that we will keep buying. Break at least break even, and then keep buying. Mm-hmm. Right. This is where the profit is. So the offer is the number one thing that brands need to really start [00:15:00] restructuring. I see a lot of plain offers done. Another subscription optimize. Just slapping the button of Subscribe and Save is not a subscription offer.

This is the latest thing you can do, and honestly. If you try to acquire customers purely on lower prices, you're gonna be outspend by the competition. They're gonna have a better offer, better return sheet. They're gonna outspend you, you're done.

Matt Edmundson: Yeah.

Thomas Lalas: So this is where we start. It's all about the offer to begin with.

Matt Edmundson: This is great. This, and, and this is very timely because actually I, I, we've been having conversations about, um, one of our sites, which has a, a one time purchase on it, but it also has subscription, uh, options on there. And, um. It's, it's, uh, it's interesting, isn't it? This whole idea are you go by, by the way, let me give a shout out.

If you are in the subscription business Subs Summit, are you going this year?

Thomas Lalas: Not really. I mean, being a father, I can't really

Matt Edmundson: Well, you can't places. [00:16:00] Yeah, yeah, yeah. So I will, but I what I

Thomas Lalas: want to,

Matt Edmundson: yeah. Why it's a great show and I know Paul Chambers is coming on and I know, um, uh, we've had Chris George on.

Um, and he, he had a very similar philosophy to what you said, Thomas, in act actual fact, he almost talked me into just doing my supplement company on a subscription only model. Do you know what I mean? It's like, why would you wanna do it any other way, Matt? And it is like, yeah, and I What happens?

Thomas Lalas: Yeah.

It's a really interesting argument. He, he almost turned you into a subscription based business. What happened?

Matt Edmundson: Well, it almost turned me into a subscription only based model. Um, we, the way the, the supplement businesses works very, it, it, it's, um, we didn't, looking at our. Uh, purchases I, well, to be fair, lemme just qualify.

I would probably think about it more now because such a high percentage of our orders are now subscription, [00:17:00] right? So we've converted a lot of our faithful customers into subscription customers. I. Um, so I'm very keen to talk to you about offers and what works there. I'm also really keen to hear what you've gotta say Thomas, about, 'cause this again is another conversation we've been having with our subscription customers with one-time purchase clients, right?

I. Um, and I love my conversation. I had recently with the, the guy, the founder from, um, the Razor Company. Oh, it's completely gone. It'll come back to me. He deliberately didn't do subscription, which I thought was fascinating. That's definitely worth listening to. Um, but the, we found with one-time purchases, it's really straightforward for me to do an upsell.

Right. Um, and increase the average order value. Where we've had a bit of an issue is, is trying to figure out how do we increase the average order value on a subscription based model. Do you see what I mean? So in other [00:18:00] words, with supplements, you kind of go, right. Well, I'll, I'll take my Omega-3, I'll take my multi vit and I'll take my vitamin D and that's it.

I'll put the whole thing on autopilot. So, um, I subscribe. To a deodorant company, for example, and every two months they send me out some deodorant. But that's it. It's, it's a repeat purchase and I think, I don't know how that deodorant company can get to. Can help me increase my order value over time. I just, other than putting its prices up, how does it get me to buy more stuff?

So two things I wanna dig into. How to increase average order value. But let's start with the offer side of things. So you're talking about you, your first thing you've gotta work on is the offer. And it can't just be, subscribe and save 'cause that's lazy, which I just think is brilliant. I'm totally quoting you on that.

Um, what else, what, what sort of things should we be thinking about? What have you found Work really well.

Thomas Lalas: Yeah. Um, and there is a very interesting [00:19:00] founder course coming out where I'm a guest and it's been, uh, it, it's been taught by my, um, the co-founder of, of Motif Digital, the agency I used to work for.

Jordan Menard. Shout out to Jordan. Amazing guy. So he breaks down this entire subject in a course, uh, for the platinum founder. Uh, if you wanna check it out, I'm a guest for like a module. Uh, but basically the whole point is to create something that, um, adds value to the lifestyle of the person. We don't buy a product just for the product itself.

It supports a lifestyle. It supports our identity. So things that you can add that support the lifestyle of the person and who you want to be. Um, number two, things that you can use with a product. Very straightforward example. You buy coffee, you need a cup. You need a frother. A whisk, right? So this is something that you will need.

You were going to buy this anyway, or you had it at home, but now you have it, uh, you have a [00:20:00] branded version of it, right? And things that are branded. You show it to your friends. And this is marketing.

Matt Edmundson: Yeah.

Thomas Lalas: Right? You can take a picture of it. You know what, you can't take a picture of things that are digital.

It needs to be physical, right? So anything that can be added in a way where postage doesn't get inflated, you know, the price of posting doesn't get inflated, uh, that can fit into a box as a starter kit, and you turn it into a beautiful starter kit, that's a great offer to begin with. But I've seen the mistake a lot of brands make is they add too much value in the starter kit.

And by comparison, the second and third order don't look so appealing anymore. What I alluded to earlier, they cancel because they wanna get all the freebies. So what we've seen working really well is spacing out the freebies month over month. Okay? So they have something else to be excited about. And basically they gamify the experience, they unlock the new three Bs.

It's, it's a [00:21:00] game. And if you add all sorts of finite, um, activities, post purchase, the whole thing becomes a game. You know? Yeah. It's who can be healthier, it's who can be more loyal, who can not break the streak. So you turn this whole thing into a fun lifestyle project, you know, becoming a better self.

And it all starts with the offer. But again, finally the offer needs to be something that makes sense economically. So I'm not, I'm not gonna play CFO here. I'm not the person that runs the numbers for the offer. I'm a person that is participating in. This the process of designing the offer.

Matt Edmundson: Yeah. Yeah. But

Thomas Lalas: I dunno how to explain, you know, what makes most sense financially?

What I know is once the offer is out, I can know, I know how to track the payback period. Yeah. And I know how to maximize LTV after that. And the goal, just like Netflix. Is trying to push the retention point as early as, as as close as possible. The first episode, meaning retention point, [00:22:00] is once the person is hooked now and will watch the rest of the series, no matter what, they want to get you hooked as early as possible.

Yeah, same thing. Um, for the payback period, you want to push that payback period as close as possible to the first purchase. If you can be profitable, the first purchase, amazing, but most brands are not. So the goal is to make sure, and this is a great site for, for the a OV question, is to push a OV to push the stickiness of the product and to get them to commit for longer.

Yeah. So, yeah, let's back to you now, because if we start talking about a OVI will never stop and it's gonna be a monologue.

Matt Edmundson: Well, no, we'll, we'll get into that in just a second, but I, I, I, I like what you say here because. What I'm understanding here, DOAs, and it makes, it, makes total sense when you think about it, is actually take your no-brainer offer and space it out.

So it's a no-brainer offer for the first order, the second order, the third order, the fourth order, and so on and so forth. Um, and, and bring those, just elongate that [00:23:00] offer so it makes sense just to keep coming back. And obviously it's gotta work for your economics, um, and you, you know, work that out. But I like it because like you're saying, most subscribed businesses are.

All about that first offer to try and get you to sign up, um, and not so great at then keeping you, you know, giving you reasons to stay really. It's like, well, I don't know. Um, and so you, you do tend to leave, but I, I, I do get the point, um, thinking for example, about this deodorant company, actually, they, they gave you an offer at the start.

But they've not really done anything since, and I've left it just 'cause it's on autopilot. Um, would I recommend them as a company, you start getting into really interesting existential questions all of a sudden because of, well, actually the in, in theory, they're still, you know, they've still got my business.

I've not stopped it yet, but I don't feel any brand loyalty to them, if that makes sense. I don't feel like they've done anything to. [00:24:00] To stop me from churning if I find a better product or someone else woo me over here. And I think whilst at the moment it's convenient, it's not actually retaining my mind and my soul other than it's just retaining my wallet because it's super convenient for right now.

Thomas Lalas: Yeah. You, you, you're saying that you are not a fan. You are just a, a buyer on auto autopilots?

Matt Edmundson: Yeah, I mean, I obviously like their product. I keep using it. Um, and uh, in some respects I like what the company stands for. What I've not become is a lo well, maybe I've not become a loyal fan. I've not, I've not shared anything out on social media.

I've not gone and said, Hey, you should buy this 'cause it's awesome. Um, they've, they've not really done anything to sort of keep me as a customer. They don't really email me. Um, it's sporadic as to whether they email me to let me know my order's [00:25:00] coming out. I, it's just, it's just a bit rubbish, really. The re

Thomas Lalas: but this is, this is the, the reality.

This is what most brands do.

Matt Edmundson: Mm-hmm.

Thomas Lalas: It, it's, that's why they ask me to come in and build something, a system, proper system. That actually collects data that actually pushes for an upsell or cross sell, that actually builds loyalty, uh, that educates the customer, that gives them a real reason to, to choose to stay subscribed.

Hmm. And, and then to keep talking about the brand and bringing more people in. This is what retention systems do. Most brands don't email, don't email enough, and they don't build that brand loyalty. And again. Right now they could have your business. And, and they do, because there, as you said, there's no competition.

But the moment somebody else comes on board and that has a better product, they're done. So this business might be dying without 'em knowing.

Matt Edmundson: Yeah.

Thomas Lalas: Just [00:26:00] because it just hasn't happened yet.

Matt Edmundson: Yeah.

Thomas Lalas: But wishing or hoping for a competitor not to arrive is not a strategy. It's not something the investors would, would really support.

So. Yeah, you gotta be proactive, man.

Matt Edmundson: You really have, especially in the subscription space, because again, one of the things that I've, I've learned from certainly people like Chris George, um, is that actually that whatever it is now, we've got an average of. I can't remember the number. So let's just pick a random number that we've, uh, we've got a typical average of, say, 20 subscriptions.

We subscribe to Netflix, to Disney, to Sky Sports and whatever it is, right? So we've got all these different subscriptions. We've now got to the point where we don't want any more subscriptions. So to take on a new one, we have to cancel an old one. It's kind of a mindset that we've fallen in. And so the ones that we cancel tend to be the ones where we just don't have.

Um, like you said, we've not had a [00:27:00] reason to stay subscribed. There's no sort of real brand loyalty. It's just like, well, I'm now prepared to go through the inconvenience of canceling the subscription because I no longer want you and I want this one over here more. And it doesn't. And it's not even like Netflix competing with Disney.

It's like netflix com competing with my deodorant company all of a sudden because I've just maxed out on all my subscriptions, which makes competition I think, a little bit more interesting. And, and so, um. I, I'm intrigued by this and I'm intrigued by these sort of changes in this model and, and why what you're saying is becoming more and more important,

Thomas Lalas: what you are saying.

Um, what, what, between the lines, what I'm reading is that, uh, the product itself plays as an important role as the, the brand around the product.

Matt Edmundson: Mm-hmm.

Thomas Lalas: Uh, here's an example. You have a Doran, right? But. Will you stop using it? Will you stop using a deodorant overall? Probably not. Um, coffee, [00:28:00] people that drink coffee will never stop drinking coffee.

Yeah. Uh, people that take, um, like sleeping pills, they will never stop taking sleeping pills. All they will find something that helps them sleep. Yeah. All we do is basically try to fulfill our existing needs with a better product. Mm-hmm. So if somebody comes along with a better product. Better brand, more fun experience and does what you want to get better.

You will and healthier you will get it. Yeah. You know, you might pay the premium, but you are switching from your existing need a, a solution to your existing need to a better solution. Uh, brands cannot manufacture needs out of thin air. They tap into existing needs. So if something is a luxury. In, in hard times you might cancel it just because it's an extra, right?

So the product, the industry you're in plays an important role, uh, in on retention, you know, as much as, as [00:29:00] the quality of your offer and, and everything we're talking about. So sometimes you might have the perfect retention system, the perfect offer, perfect product, ecological, you know, cheap, convenient.

But if it's a luxury, somebody might cancel this first, when the times get hard.

Matt Edmundson: Yeah. Yeah. It's so true. So true. So Thomas, let's talk about a OV Actually before we do, normally I save this to the end, but uh, it's in my head right now. Um, I. If you're a regular to the show, you'll know usually not every show.

'cause quite often I'll forget. But I've remembered today, I asked my guest for a question, and this is quite an interesting point of the show to ask for said question. Uh, so Thomas, you said to me at, right at the start of recording, you're like, I've got my question. I know what it is. Do you wanna know what it is?

I'm like, no, tell me in the show. So now is your time to give me your question.

Thomas Lalas: Hello ladies and gentlemen. Uh, so Matt wants me to ask a question. Um, so Matt, you have [00:30:00] recorded hundreds of of interviews. You have spoken with hundreds of interesting people that are experts and there are amazing at what they do, and they have audiences and they work with amazing brands.

You are not a content creator to me. You are a network provider. So how do you think about all the, this asset that you've built, the network, the side product of your show? How do you think about it and what are your plans about it?

Matt Edmundson: This is a great question. Very good question. In fact, I was talking to, um, I dunno, do you know Pete Murphy?

Lewis? Do you know him? Strategic Pete? He's been on the show before actually. Um, Peter Murphy, another music show. Uh, no, no. Well, he does play musical instruments. He's also on the TV a lot and he is, anyways, he is a. He's a, a marketing guy. Um, anyway, he's a, I was talking to him about this very question. Uh, so, uh, today, this afternoon, in fact, uh, [00:31:00] it was morning for him, afternoon for me.

Um, so I will answer that question. Uh, it will be on my social media channels. Come find me. Uh, just find me on LinkedIn. I. Uh, at Matt Edmondson, or you can find me on Instagram at Matt Edmondson. I really need to get better at the old Instagram thing, but I'm pretty active on the old LinkedIn, so come find me there and you'll find the answer to that question.

Thomas, thank you for that question. Uh, I thought it was a great question. Um, so let's get back into it. A OV, how do I, if I am, uh, a business which is managing my retention through subscriptions, um, which, you know, I appreciate is one specific route to do retention, um. And obviously a very sensible one. I mean, you know, my experience is this has been great for our retention marketing is introducing the subscription.

What, how do I increase average order value? Because this, for me is a big thing, right? Mm-hmm. Um, subscription has its advantages. One of its key downsides, it seems to me is the ability to easily increase average order value with upsells and cross sells and things like that [00:32:00] when someone's going through checkout.

What are your thoughts on this? 'cause I'm, I have my pen, I have my paper and I'm very keen to hear,

Thomas Lalas: uh, is it okay to also shout out a few companies that can make this easier? Yeah, yeah, totally.

To me, it's actually quite easy to get these upsells and cross sells and increase a OB. Um, so I'm kind of surprised about like the number of businesses that struggle with this because to me it should be more straightforward. Um, yeah, one thing. That a lot of brands do and I support this is during checkout or before checkout, you actually push for more of the product.

They, they just, they're about to purchase. Mm-hmm. Right. So the good old upsell, you, you take 30 servings now get 60 servings and here's the deal. Yeah. Or you cross sell something that fits well with the product, you know, on the backend what, which product goes well with, with. Yeah. Which one? From your portfolio and you [00:33:00] create rules where you recommend this product when something is in the cart, right?

Yeah. So you just need to look into the analytics now. By now we're talking about once they've started their subscription. Mm-hmm. The way that I approach this is, um, in two phases. Phase number one, they haven't received the product yet. They haven't received the first order, and, and they're, they're anxious.

Is it a good purchase? They're skeptical. Is it the right brand? Is this good value for money? Yeah. So this is the time to get them to alleviate this pain and to get them to talk about themselves and reveal their their needs because this is gonna be the way we personalize their experience later. So I'm always asking right away, right after purchase, send them an email.

Asking for questions for, for a few answers in, in a survey. Yeah. And, and I use these answers to personalize their exp experience later. So armed with these questions, once the, the product is there, I make sure they share the enthusiasm, uh, on, in a Facebook group or in an ad, which [00:34:00] makes the ad even more profitable because it has it stuck up.

Social proof. And now these people, they're excited, you've done the right thing up to delivery point, and now they're excited, but it's not the right time to upsell them because they haven't used the product. They need to feel confident about the product first. Mm-hmm. The way that I achieve this with my brands is I do what I, I've, I've invented this, this method, which is, uh, called bite-sized premium masterclasses.

A lot of brands do the simple trick, like send an email with a lot of information or send an email with a blog post, and they believe that the education of the product is done. Yeah, people don't consume blog posts, they don't read long emails. They need bite sized information. So I take this existing information and turn into masterclasses, usually on Typeform.

Shout out to Typeform. Where they see a few words in each slide with visuals, and they click next and they get [00:35:00] spoonfed, you know, small beats, uh, beats and pieces of, yeah, the education we want 'em to get, and they start realizing that the product can be a part of their lifestyle, how it helps them achieve the long-term goals, the time span for them to feel the full effects of the product, et cetera.

At the end of each masterclass, that's where the magic happens. I upsell them more of their existing product if it makes sense, or if I know what their initial purchase is and collect the right information post purchase. I offer them something that compliments the product. And usually people that don't participate in these master classes, they will get a default option based on what I know historically from my, from my customers and their journey.

But what I've seen, Matt, is that. 30, 33% of people that complete at least one masterclass, they take the upsell [00:36:00] across all, which is huge.

Matt Edmundson: Okay. Yeah. So

Thomas Lalas: I've basically turned knowledge and education into a fun event that has day one, day two, day three, and then there is a graduation, and the graduation includes a bundle of.

Of badges, downloadables, um, the next freebie and a discount. And people choose what they want.

Matt Edmundson: Yeah.

Thomas Lalas: And eventually they get multiple reminders in a fun system that doesn't feel pushy. And again, a lot of them get the absolute and cross all. So in fact, that's why, uh, once I start implementing this system in businesses, you see that the upsell, the, the take of the upsell product increases in revenue more and more.

So it stocks up. And these people have far superior retention.

Matt Edmundson: Mm.

Thomas Lalas: So this is one of the things that I do. The second opportunity, uh, after they complete the masterclass and a week after the product, I check in with 'em again, send them to a good old type form, and I ask [00:37:00] them about their three main objections.

I want to see how well they're doing. I ask them if they feel an early impact in their wellbeing or whatever the product is trying to achieve. And I also ask them a question that will qualify them for a cross sell. For example, let's say I offer a product that boosts your, your brain. It makes you more productive, more focused, but I also offer products that still helps you sleep better, products for your gut, et cetera.

I will ask a question that will help understand if the right next pitch is, you know, the, um, the sleep product or the gut product or, or whatnot. I. Uh, but I will not ask, Hey, would you like this product? Yeah. I will ask them a question that reveals the problem if they have another problem.

Matt Edmundson: Yeah. And

Thomas Lalas: then we follow up with a sequence that pushes what they already told us.

Mm-hmm. So now it's a seamless promotion that is true to who they are and what they struggle with. [00:38:00]

Matt Edmundson: Yeah.

Thomas Lalas: Finally, before the first reveal, I, I will basically do them raise your hand kinda sequence where. I will show what the offer is. It's gonna be usually a bundle of multiple products. It's gonna be more expensive, or it's gonna be the product they bought, but six months worth of stock or a year worth of stock.

And initially, we'll send it to every, uh, customer. Later. As I get data, I will set it only to people that have been tagged as likely to stay on board and not churn. Right. If you're likely to churn, it doesn't make sense for you to buy a bigger bundle. Instead, you're gonna get an offer like a down sell so you don't churn.

But initially, I will send this to everyone. So a bundle that upsells you and locks you in for a longer period of time, or a bundle with more products so you can get the holistic experience. And these people, like the customers, eat them up. They love these products and, and these offers because they make sense in terms of where they are.

And we personalize their journey based [00:39:00] on the signals they gave us.

Matt Edmundson: Yeah. Yeah. Right.

Thomas Lalas: And as you can imagine, this cannot happen unless you send a lot of email, but the right type of email so you can collect all these signals. So taking a step back, brands don't send enough email, they don't communicate with the customers enough.

Yeah. That is a big takeaway. And if you're sending three or four emails post purchase. You are doing it all wrong, sorry to say, but you are leaving so much on the table. Retention can go much, much higher and cross sells and upsells and LTV.

Matt Edmundson: Yeah, no, super. Because actually a lot of what you've talked about there, Thomas works in subscription, but actually it would also work in a, in a one-time purchase, um, deal.

Um, I love what you said right at the start. Excuse me. Where, um, and I've not heard many people talk about it for a long time. It [00:40:00] used to be this real buzz topic, but it, it sort of seems to have died a little bit. Um, and that's the, the, the period between a customer clicking buy now and the customer receiving their product.

There's always a period of time. Um, and in the UK that might be one or two days, it might be three or four, depending on when it was ordered and when it was sold, uh, when it was delivered In the States, it may be more, do you know what I mean? Depending on the size of your country. So you, you do have this.

This thing where there is this anticipation. So in my hand, uh, shout out to Tom's studio. Uh, I really like Tom's Studio's pens. I have a, a, a fountain pen in my hand where I write my notes with. I just really like that pens, right? And I, I ordered this pen, um, a couple days ago 'cause I wanted one for my office.

And, uh, it, it, it arrived next day, but it was delivered to my neighbor and I thought. Isn't it, it's just a, I I really like their stuff and their packaging and, and their ethos and I, you know, I, I [00:41:00] do, I am a, I am a bit of a loyal fan of Tom's Studios, but I'm just a lit, little bit disappointed. Tom's Studios, if you are listening, there's been no email.

And, and just to what Thomas has said, you could have sent me an email going. Your fountain pens on the way. Matt, this, this and sent me two emails the same day that I, you know, one email the day I purchased an email the day after going, this is how to write with a PTO pen. 'cause it does require something a little bit different.

This is how you clean and maintain your fountain pen. Watch this video or gimme some nice quirky graphics. Um, by the way, if you draw something or write some poetry with it. Take a photo and tag us with it on social media because we, do, you know what I mean? Those kind of things. Yeah. They just, they just haven't happened.

And I get it because it's a small company. It's, I guess there's like a, a handful of people trying to, you know, do everything and you can only dose too much. But this idea of. Send in three or four post-purchase emails, especially in that [00:42:00] time where I'm waiting for the product. And you can turn my fear. I loved how you talked about, um, how you turn their fear or their anxiety into excitement.

That was what I wrote in my notes. Yeah. Turn their, their anxiety into excitement. I love that. And I think it's just a shame we're not doing that any, you know what I mean at the moment, any more than we actually are. Uh, and I think even just doing that, you're gonna have some massive wins.

Thomas Lalas: Yeah. And, and I really want to share this analogy.

Um, a lot of brands will say, yeah, but you know, people don't read emails. Uh, and you know, all these, the old spiel about email is dead for the last 20 years. Oh,

Matt Edmundson: it's not,

Thomas Lalas: yeah. But email, we, we'll go to space, but we're still gonna use the spoon. Yeah, because it's a proven tool. It's been there for, for ens.

And the same thing for email. Yeah. We might still send email to people when we go to space. Mm-hmm. Because [00:43:00] the most reliable tool. Yeah. We'll just never stop using email. So if brands are afraid of sending email, like would you be afraid of like eating with a spoon? It, it's a proven tool. Just use it. Yeah.

Uh, yeah, very much so. I say one, one more thing that a lot of brands are actually missing out on. And, uh, actually two things. Number one, meet the customer where they are, and number two, tap in their network. You know, it has to do with, with the question that I ask you about the network. Number one, uh, meet the customer where they are.

What makes most sense is if you bring customers from Facebook, from Meta Build a Facebook group and. Put these people in there. Yeah, you'll generate a lot of UGC, a lot of social proof. They will do the selling for you because if there are a hundred thousand people in the Facebook group that love the product, you might think these people know something that I don't, you know, I didn't get the effect of the product fast, but these people did.

[00:44:00] So I'm gonna stick around so you got a, uh, an ever-growing cell machine. Uh, the Facebook group, you know, so meet these people where they are, but also if you are talking to a younger audience and they found you on, on a, on a mobile phone, then create an app. Use a company like Fuego to create an app and basically mirror the website and add additional features.

Exclusive for the app. Now these people shop and they do things around your brand in their natural environment. But then also make sure that people bring friends. We use a referral candy because it's very easy and it just does the thing, but allow people to talk about your product. Like you talk to me on this podcast and to, you know, a lot of people about your pen, right?

If, uh, the pen company had sent like a referral email. You probably would've, uh, taken on like, you know, whatever the deal is and, and talked about it, and then profit from it as [00:45:00] well. We, we don't do these things for the profit. We do it to recommend good products to friends and family, right? So tapping into this, it's just additional marketing that costs you nothing you already paid to acquire this customer.

So why not meet people where they are? Create this community that is basically free marketing for you and tap into the network. These are basic things for me that a lot of brands just haven't tapped into. So just shout out to these amazing companies and, you know, these are like some quick, uh, trips, uh, quick tips that improve retention that I want to share.

Matt Edmundson: Yeah. No, it's cool. And I'm glad you mentioned referral candy. Raul has been on the podcast before. Um, oh, sorry. Well, I kicked my bin, uh, but Raul's been on the podcast before and, and do go check out that that episode, uh, shout out to, um, what those guys are doing there. Referral candy, which is great. It's, um, I'm intrigued to, uh, the one thing you said, which slightly surprised me, um, was the [00:46:00] fact you used Typeform, uh, to do these sort of mini master classes.

Thomas Lalas: I've been a cus I've been a customer for. 10 years now.

Matt Edmundson: Yeah. Yeah, I, I, and I, and, and as soon as you said it, I could see it in my head and I thought, that's really clever. I would not have thought to have done that with Typeform. Um, but you know, Typeform has got good APIs and you can integrate it with all kinds of things now, can't you?

And collect that customer data.

Thomas Lalas: Yeah.

Matt Edmundson: Um, and I like how you're using Typeform to pre-qualify. Um, so for example, you know, I, I do. On a scale of one to 10, how well are you sleeping? Um, could be one of the questions that we ask. 'cause we have a sleep supplement, for example, and you kind of go, oh, these guys are, are not sleeping that well.

So, uh, I can put them on a sequence which talks about how you can use nutrition to sleep better. Right. So it's a really, uh, it's a, it makes a lot of sense to me what you said, and I can see why you like it, uh, as much as you do. Thomas. Um. [00:47:00] And, and thank you. Uh, thank you for sharing that and, and, and, and bringing that value.

I've genuinely enjoyed it. Um, if people wanna find out more about you, maybe connect with you, ask them, maybe they've got some more questions. Maybe they even want to, you know, talk to you about hiring you and, and getting that and getting your help. Um, or the course that you mentioned. You, you mentioned a friend's course, but I, I don't remember you, you mentioning what it's called or where, where to find it.

Uh, now's your time. Share all that information.

Thomas Lalas: Sure. So the best way for people to find out about me and talk with me is through LinkedIn. Yep. Thomas Lalas. I have created a consultancy firm, um, called The Art of eCom. I'm still building website as we speak, et cetera, so I wouldn't recommend people to go to, to my website.

Matt Edmundson: Uh, and the, we're always building websites. That's a problem, isn't it? Yeah. Under construction. Yeah,

Thomas Lalas: my thing is my side is still under

Matt Edmundson: construction. Yeah.

Thomas Lalas: Yeah. And, and the, the, the, the course that I talked about, uh, the [00:48:00] platform is called Founder. It's mm-hmm. The word founder, but without the e Yeah. It used to be a magazine.

Now it's a, a, an online platform with courses, consultancy, um, a lot of cool stuff. So it's dropping in sometime in, in March this year. Fantastic. Uh, it's all about offers and subscriptions and it's really in depth. Um.

Matt Edmundson: Sounds fantastic. Sounds absolutely fantastic. Uh, and I know yeah, the founder goes. Yeah.

Yeah. Great. Fantastic. Um, so we'll of course link to all of that in the show notes as well, including Thomas's LinkedIn. I. Uh, which is, we, we were commenting whose post were we commenting, but we both commented on Jamie, Jimmy, Kim's Kim Post. Yeah, he, he took, you should follow him on, on LinkedIn. He, he talks a lot about email and, um, I just really like his LinkedIn post.

He just basically tells you off every time, doesn't he? It's just really funny. Um, and we were both commenting on that and, uh, yeah, you, you were like, we should talk about this on the podcast. Uh, so I, Thomas is active on LinkedIn. Come. [00:49:00] Come find him and say, ha say, how's it? And, uh, we will of course link to all of that in the show notes.

But Thomas, thanks man. Genuinely appreciate that. And, uh, thanks for coming and delivering some great value.

Thomas Lalas: Love it, man. It's, you're a natural, uh, again, back to the compliments. You're a na you're, you're a na, you're a natural. You make everything you know, flows so easy and yeah, well done. Good to you. I enjoy, fantastic

Matt Edmundson: mate.

Oh, bless you. We should do this. Well done. Uh, that's the applause. That's enough applause. Uh, so, uh, brilliant. Like I said, we will of course link to all of the information for Thomas in the show notes, uh, which you can see on the website. eCommerce podcast.net. If you subscribe to our magical newsletter, they'll be in there as well.

And of course, I'm not gonna try and pull the wall over your eyes. You're listening to this on a podcast app, more than likely, or you're watching it on YouTube. The links will also be in the show notes. Just, just download them or, uh, click them in the show notes and download 'em. But just click them. [00:50:00] Uh, they're there as well.

Uh, go and say, how's it go? Introduce yourself to, uh, to Thomas. I'm sure I'd love to talk with you. Uh, but what a great conversation. Now do be sure to follow the e-commerce podcast wherever you get your podcast from because we've got some more great conversations lined up. And of course, I don't want you to miss any of them.

Why would I? Uh, and in case no one has told you yet, stay. Let me be the first. You are awesome. Yes, you are created. Awesome. It's just a burden you have to bear. Thomas has gotta bear it. I've gotta bear it. You have got to bear it as well. Now, the E-Commerce podcast is produced by Pod Junction. You can find our entire archive of episodes on your favorite podcast app.

The theme music was written by Josh Edmondson. Uh, and just one more plug for the website. Go to eCommerce podcast. Podcast, uh, e-commerce podcast. We never edit these things out. It's just the way we do it. Just go to eCommerce podcast. It's real authentic. It's real. It's authentic. That's right. It's just me messing up for the.

Thousandth time. Uh, and if you are still listening at this stage, thank [00:51:00] you. It's great to be with you. Uh, do like to say like, and subscribe to the show, but pretty much that's it from me. That's it from Thomas. Thank you so much for joining us. Have a fantastic week wherever you are in the world. I will see you next time.

Bye for now.

Bye.