How Sally Beauty Europe Achieved Digital Transformation
In today’s digital world, many companies rely heavily on technology to drive conversions. But what happened to the art of conversation in marketing?
The team at Sally Beauty Europe believes that turning to data to determine what the customer wants and how they will benefit is the key.
By focusing on the customer, what they can achieve, and what is going to change for them, Sally Beauty Europe was able to leverage conversational marketing to increase email attributed web sales growth by 43% YoY, ATV (average transaction value) with recommendations by 19%, and total monthly sales attributed to digital communication channels by 20%.
In his Emarsys Revolution 2018 presentation, Sally Beauty Europe’s Scott Jonsmyth-Clarke explains the importance of “friendship marketing,” the conversational ecosystem, and happiness checks to drive customer communication and satisfaction.
Watch the full-length, 34-minute video:
Recap: Sally Beauty Europe’s Business, Strategy, & Results
Though Sally Beauty is an American-owned business, it knew the global market was ripe for expansion. In 1987, Sally Beauty opened its 500th store when it expanded into the U.K. and Ireland. In 2013, the brand opened their three-story U.K. flagship store on London’s Oxford street. As of 2017, Sally has over 5,000 stores and continues to grow rapidly today.
The brand operates five e-commerce websites, two head offices, two distribution centers, and supports two full-service teams.
“Trade customers” are the brand’s #1 priority. Their audience consists of 91% females where 50% of sales come from gold customers and 75% of its database is active (purchasing within the last 12 months). It also caters to what it calls retail customers — those seeking mainly salon products (basket sizes are lower).
The U.K. team has a digital communications lead, a database and insights lead, a direct mail lead, and an acquisition manager. The Belgium team has a digital communication lead and a database and insights lead.
Sally’s customers are active on and respond best to email, SMS, their website, direct mail, Facebook, Instagram, and Google.
Sally Beauty offers regular monthly communications for trade and retail customers, including various promotions and sales. It also executes targeted communications — a mix of “friendship marketing” and sales-driving activities. These include typical welcome programs, event-based triggers like birthday programs, and more.
The Friendship Marketing Ecosystem
Friendship marketing is about putting the customer first and having a conversational approach. Key areas of focus include:
- Personalization — enriching customer data to provide appropriate content at the right time based on the lifecycle stage, RFM segment, and product affinity of the customer
- Automation — increasing near real-time communications to enable more meaningful interactions with the customer
- Engagement — executing a channel-agnostic communications strategy to boost reach and engagement
- Retention — encompassing the full lifecycle of the customer to propel retention; adopting a surgical approach to execute the offer strategy while protecting margins
“Friendship marketing is the concept we’ve been working on for quite a while now — it’s customer-first and having a more conversational approach with customers. The way I always think about it is like this: you can understand their transactions, web interactions, call center [touchpoints], and in-store… but what about what the customer’s saying? How do you bring that back into your database and leverage that data to then close the loop…?”
The conversational ecosystem for Sally Beauty looks like this:
Prospect ► Welcome ► VIP/Birthday/etc. ► Abandoned Cart/Replenishment ► Post-Purchase ► Reactivation/Case Studies
To better understand their trade customer and what they do, the team at Sally collects information from them and makes sure it gets back into their database so they can use it to personalize the entire experience. Thus far, the impact of conversational marketing has been quantifiably notable:
- +9% shopping frequency increase
- +24% ATV increase
- +65% email open rate peak
- +20% own brand unit participation
The overall impact from conversational marketing includes:
- +19% ATV with recommendations
- +43% email attributed web sales growth YoY
- +25% email and SMS attributed total sales growth YoY
- 20% total monthly sales attributed to digital communication channels
- +29% increase in email open rate
- +28% CTR
- 89% automated email attributed sales
- 75% automated email deliveries
The future is all about personalization — to continue to develop segmentation models, targeting based on personas, and utilizing AI-driven product recommendations. A stern focus on friendship marketing — refreshing existing (and new) friendship marketing programs to enhance the ecosystem — will continue. An omnichannel content strategy based on inspiration and knowledge-sharing while (reducing promotional content) will also be a focus. Lastly, the brand plans to investigate new ways to provide a personalized in-store CX.
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