Petstop’s shift from paid channels to sustainable revenue through email marketing

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Petstop offers pet foods, supplies and many other accessories in their 13 large pet superstores throughout Ireland.

Their love for pets extends to their owners too, and Petstop’s recent focus on creating a highly personalised abandoned cart series for their email subscribers won them the Best shopper recapture experience at The Klicks 2024.

*All stats courtesy of Petstop and Wolfgang Digital

How Petstop’s move to owned channels drastically increased revenue and repeat purchases

Objectives

In 2023, acquisition costs on platforms like Google and Meta increased by 60%. In response, Petstop and its marketing partner, Wolfgang Digital, saw the need to shift to more sustainable and cost-effective revenue streams. 

They embarked on a mission to drive conversions and improve customer retention through owned channels like email marketing, aiming for both immediate and long-term growth. Together, they planned to:

1. Increase revenue from pre-purchase flows by 20% year-over-year (YoY)
2. Raise customer lifetime value (CLV) by 15% YoY
3. Achieve a 20x return on investment (ROI) from email flows by the end of 2024

Strategy

To reduce reliance on costly paid channels, Petstop and Wolfgang Digital pivoted to owned channels, focusing on email marketing through Klaviyo automation.

This strategy targeted customers at critical stages of their purchasing journey, specifically a subscriber who browsed products, abandoned their carts, or exited at checkout.

Key elements of Petstop’s cart and browse abandonment strategy included:

1. Hyper-personalisation with AI: Using advanced segmentation and conditional logic, emails were tailored to individual pet preferences. By integrating with Shop Box, an AI-powered personalisation platform, Petstop automatically generated dynamic product recommendations based on individuals’ shopping psychology, ensuring each email felt highly relevant to the recipient.
2. Promote subscriptions: To promote Petstop’s subscription service, all emails highlighted the benefits of subscription, such as a 10% discount on every purchase. This significantly boosted awareness and subscriptions, turning one-time customers into repeat buyers.
3. Strategic incentives: Time-sensitive discounts (e.g. 10% off for three days) created urgency, along with other motivators like flexible payment options, free delivery on orders over €29, and customer reviews.

Results

Petstop’s email recapture strategy demonstrated the effectiveness of email marketing as a sustainable revenue driver and retention tool amidst rising acquisition costs. The approach not only met but exceeded all targets:

1. Revenue from pre-purchase flows grew by an impressive 28.9% YoY. This was based on browse abandonment (94% YoY increase), abandoned checkout flows (15% YoY), and a new abandoned cart that saw revenue increase by 999% YoY.
   
2. CLV increased by 39% YoY. Subscription renewals grew by 86% YoY, with a 31% rise in subscriptions from abandoned browse, abandoned cart, and checkout flows.

This meant Petstop exceeded their ROI goal, achieving a 31x ROI from email campaigns by recapturing customers effectively and converting them to loyal subscribers.

“The data you have access to in Klaviyo and the ability to create hyper-segmented flows means you can see such a strong return on your investment,” said Alicia Leao at Wolfgang Digital. 

The data you have access to in Klaviyo and the ability to create hyper-segmented flows means you can see such a strong return on your investment

Petstop have showcased the impact of shifting from paid channels to owned channels, achieving substantial growth by establishing email marketing as a key driver of sustainable revenue and customer loyalty.