Six ways to nail your digital marketing strategy, from GlamCorner co-founder Dean Jones

Fashion-sharing startup GlamCorner has tripled in size over the past year, both in terms of revenue and customer base, and co-founder Dean Jones says it’s pretty much all due to its digital marketing strategy.

Founded in 2012 by Jones and his wife Audrey Khaing-Jones, Sydney-based GlamCorner provides a sharing economy platform that allows users to rent designer clothes, in a bid to combat the wear-once habits of shoppers.

In July last year, the startup bagged $4.2 million in Series A funding, in a round led by AirTree Ventures and including Marshall Investments, which owns the Sportscraft, SABA and JAG brands. Other investors included Sass & Bide co-founder Sarah-Jane Clarke, Silicon Valley-based Partners for Growth, and Impact Investment Group’s Giant Leap Fund.

Jones doesn’t disclose the exact figures, but he tells StartupSmart GlamCorner’s revenue is now in the multiple millions, and its customer base in in the hundreds of thousands.

It’s more a scale-up than a startup these days, he says; the business is processing 15 to 20 tonnes of clothes a month, which Jones sees as “diverting 15 to 20 tonnes of clothing from landfill”.

GlamCorner has even recently opened its own in-house laundromat and garment care facility because laundromats were unable to cope with the company’s volumes. Also, Jones says, it doesn’t hurt to keep a closer eye on quality control.

When asked how much of GlamCorner’s growth can be attributed to its digital marketing strategy, Jones boldly says: “All of it”.

So how can others startups make the most of the digital world available to them and translate that into more customers and more revenue? Jones shared with us six ways startups can make the most out of digital marketing.

1. Understand you customer

As a starting point, Jones says it’s critical for startups to understand customers and their behaviour through what he calls “retailing 101”: analysing patterns around customers to get an insight into the customer journey.

There are commonalities in the kinds of products first-time GlamCorner customers book, Jones says, and so the team tries to direct them to those items first, “then you’ve won half the battle there”.

The habits of repeat customers are slightly different, so to re-engage customers GlamCorner “look[s] to display products that are more conducive to repeat behaviour”, says Jones.

“Being data-driven doesn’t mean you have to have a PhD in statistics. It’s just having insight into what your customer wants,” he adds.

2. Focus on customer retention

But while customer acquisition is important, Jones estimates that customer retention accounts for 50% of GlamCorner’s growth.

“I think that’s often underestimated,” he says.

“Never neglect customer retention, it’s very powerful,” he adds.

“It’s a slow burn, but compound growth becomes a very powerful thing when your retention machine is really working.”

Part of this is keeping customers who like the business model from going to competitors — and there will be competitors.

“If you don’t have competition yet, you soon will,” he says.

“When you find customers who like your product or service you really have to nurture them.”

One way GlamCorner has managed this is through a refer-a-friend scheme, which allows existing customers to ‘gift’ a friend $20 of credit, and then receive $20 in credit themselves when that gift is redeemed.

This kind of incentive leads to “customers being real ambassadors of the brand,” Jones says.

“They feel rewarded and they have a reason to come back to you, rather than someone else,” he adds.

3. Be disciplined on spending

When it comes to digital marketing, it’s important to be disciplined on the amount invested into bringing each customer on board, Jones says. And this figure will be different for different companies.

Startups should figure out the “right number for your business model”, he says.

While, startups will ideally want to make a return on investment from the customer’s first transaction, they can also consider the “cost of acquisition to lifetime value ratio” to gain a better understanding of “where that balance is”.

“It’s fine to pay more to acquire that customer, as long as you understand that customer,” he adds.

The danger here is that companies can acquire a lot of customers and grow very quickly, but then find themselves unable to manage the demand from those customers, Jones says.

“Your objective is to build a sustainable business,” he says.

“There’s no point in growing too quickly if you compromise profitability.”

It’s important to get the right business model in place at the startup stage, Jones says, because “the most annoying thing about inefficiency is that it scales really well”.

It might mean compromising growth, but there’s a difference between growing fast and growing too fast, Jones says.

“I don’t believe steady implies slow, you can be steady and fast, it’s just what degree of fast,” he adds.

4. SEO can be free

In the early days of a startup, when money is tight, there are digital marketing tricks that don’t cost a penny. To this end, Jones recommends focusing on free search engine optimisation techniques right from the offset, and then building a long-term strategy.

“Start early on SEO and never stop. It’s a moving target,” he says.

To do this, founders should make an effort to understand the intricacies of search engines. Mastering SEO is “no dark art,” Jones says, and it can be achieved simply by reading literature published online, plenty of which is available free of charge.

“You just have to put in the time,” he adds.

But the main reason doing your own SEO is so important, Jones says, isn’t in the cost savings. If you build a business purely based on paid-for digital marketing and customer acquisition, “your business can kind of become addicted, and it never stops”, he says.

There’s nothing wrong with having paid digital marketing as part of your strategy, but if it’s a big part, you may be missing out on the opportunities of organic search results, Jones says.

“We learnt this through doing it. There’s no silver bullet there, there’s no quick path to victory. It’s hard work and it takes a lot of time,” he says.

“If there’s a short term compromise, you’ll probably be paying for it later.”

5. Invest, when you can

There may be plenty of free ways to spread the word about your startup, but there’s also something to be said for parting with a bit of cash to give your marketing strategy an extra boost.

GlamCorner has invested in personalisation, databases and software to “make sure we’re delivering the right email to the right customer at the right time,” Jones says.

“Personalisation goes beyond just knowing our customers first name,” he adds. For example, it could constitute recommendations, instructions on how to get started, or even personalised order confirmations.

“Once you get to a certain size, customers are at different stages of their customer lifecycle,” Jones explains.

“Email is actually a really good way to segment customers and have them on different journeys at different times.”

Data-driven personalisation doesn’t have to be “overly scientific or invasive in any way”, Jones says. It’s more a case of noticing patterns in customer behaviour and helping them to get more enjoyment out of the service.

And, for GlamCorner, this isn’t just theory. Since the startup invested in personalised emails, in a year in which revenue tripled, it saw a 6% to 7% increase in revenue share coming directly from emails.

Since the investment, revenues coming from emails will soon have increased tenfold, Jones says.

6. Diversify

Finally, Jones stresses that startups should not be over-reliant on any one channel for their digital marketing.

Search algorithms can change, social media rankings can change, email delivery clients can get more sophisticated and change the way you’re able to contact customers, and paid channels can get more expensive.

When you don’t yet have good search rankings or customer retention rates, “you need to really nurture your email communications with your current customers”, Jones says, as “that’s the only channel you’ve got”.

On the other hand, social media is an important tool that is “not going anywhere”.

“When done properly, [social media is] a really excellent way to engage with you customers on a personal level,” Jones says.

Whether a startup opts only for free digital marketing options, pays for software solutions or gets a third party on board, the marketing mix should be just that, says Jones, “a mix of channels given equal attention”.

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