How Military Hippie Turns Shipping Delays into Upsell Emails (and on Track to Do Nearly $2 Million in Sales)
It’s tough to break a hippie’s heart…
But a broken promise from a manufacturing partner is enough to do the job.
“Oh my gosh, it stresses me out all day long,” says Karolyn Fox.
Unfortunately Fox, the founding hippie at Military Hippie, a women’s apparel brand that puts a modern spin on favorite classic, bohemian and vintage fashions, it’s not uncommon for manufacturing partners to fall short.
“They’ll overpromise and underdeliver at times,” Fox concedes.
It’s tough to keep up with demand when sales grow 640% year over year as they are at Military Hippie. When Fox and her team know they have a style likely to sell out quickly, they’ll often put a delivery date next to the item so customers know when they can expect it.
But when the manufacturing partner doesn’t deliver by that date…
It means Military Hippie can’t either.
“It breaks our heart,” Fox says. “We try so hard to please the customer and feel terrible when we have to deliver bad news.”
But when the bad news is delivered…
Instead of anger it often results in a significant lift in sales.
730+ Days Straight (& Counting)
Fox hasn’t taken a day off in more than two years…
She can’t afford to when you consider that shortly after its launch, Military Hippie began routinely doing a half-million dollars in sales a month. The idea underpinning Military Hippie is to offer wardrobe staples like sweaters and jackets to women who value comfort. These women are inspired to live the lives they want to lead, rather than uncomfortable suits or tight dresses which are often the norm today.
The strategy was an immediate hit and resulted in marathon work sessions.
“We work around the clock,” Fox says. “I work Sundays and the team is just as dedicated. It’s amazing to wake up in the morning and see we’ve already done tens of thousands of dollars in sales. We’re not perfect but people are falling in love with the brand.”
That love is easy to spot when you take a look beneath the Military Hippie hood and examine the company’s phenomenal growth:
- $1.25 million in 2016
- $800,000 in September 2017
- On track to do $7 million in 2017
What’s driving this triple digit growth?
In addition to an obsessive focus on customer service and an expanding product line that now includes swimwear, Fox credits email marketing with driving a significant portion of Military Hippie’s top line growth. In fact, approximately a quarter of the company’s sales are attributable to email marketing.
In other words, Military Hippie’s email marketing is on pace to generate nearly $2 million this year.
“We put a lot of energy into email marketing and have been super successful,” Fox says. “Some of our most lucrative campaigns have been email marketing campaigns.”
But what about the broken promises from manufacturing partners?
Not even highly targeted email based on customer behavior can overcome missed deadlines that result in customers not getting the items they ordered on time, right?
It may seem counterintuitive…
But customers getting “I’m sorry” emails from Military Hippie actually wind up spending more money.
Turning Delays Into Dollars
They were blue and certainly fluffy…
But when the shipment of popular sweaters that Fox had been awaiting arrived one thing was painfully clear; the sweaters were just too small, especially for customers who had ordered larger sizes.
“We decided not to even send them out to customers because we knew they wouldn’t fit right,” Fox recalls. “We knew they were wrong and didn’t want to disappoint our customers.”
So Fox and her team started cancelling the orders…
Of course, customers were not happy but not in the way you might suspect. Instead of complaining, customers actually begged Fox not to cancel their orders.
It was an “ah-ha” moment Fox would use in future email marketing campaigns.
“I asked the customers if they were willing to wait,” she says.
They were even though ordering a new batch of sweaters would add fifteen days or more to their promised delivery date. “When we miss a deadline customers just want us to be honest about it,” Fox says. “Honesty is the best policy and we immediately explain to them why their order is going to be late.”
In addition to honesty, Fox adds one more ingredient to a recipe she says routinely results in email marketing success; a discounted upsell opportunity.
For instance, in the Fluffy Blue Sweater example, Fox used a “Shipping Update” email to personally update customers on the status of their orders. Importantly, she also offers these customers a $25 discount off any item as a way of both apologizing and thanking customers for their patience and loyalty:
The discount embedded in the update also doubles as an upsell opportunity with the potential to increase AOV (average order value).
The results from this email alone include:
- A 63.1% email open rate
- A 2.47% upsell conversion rate
For context, compare the results above with a separate “abandoned cart recovery” campaign that did not perform nearly as well:
- A 10.3% email open rate
- A 1.5% purchase conversion rate
“We don’t even intend the discount as an upsell in the traditional sense,” Fox says. “We just want to offer customers something valuable in return for their loyalty and patience. It’s great that we make money but really all we’re trying to do is please the customer.”
The secret to doing that, according to Fox, is understanding the customer better than competitors. It’s one reason Fox invests time and attention intelligently segmenting her growing email list of 75,000 customers. The company has sliced and diced its customers into approximately thirty segments based on their browsing and purchasing behavior.
“We’re always asking ourselves how do we get people’s attention,” Fox says. “Often the key is talking to them about what they’ve purchased in the past.”
Nowhere is that logic on display better than another of Military Hippie’s top performing email marketing campaigns; limited time flash sales. Besides leveraging customer data, Military Hippie’s 24-hour flash sale emails are also effectively laced with urgency:
The results from this email alone include:
- A 25% email open rate
- A 6% purchase conversion rate
“The time sensitivity makes these emails some of our most effective,” Fox says. “Some of our best performers are our flash sale emails.”
But remember that odd edge of Fox’s…
The one in which she turns delivery delays into high converting upsell email?
It’s an edge she may soon lose.
Hippies Who Help
From day one Fox has seemingly been playing catch up…
The accelerated revenue growth has been extremely difficult to keep up with especially when you’re constantly running out of room and struggling to manage inventory. In fact, after moving out of Fox’s home where orders were originally fulfilled and into a warehouse, Military Hippie quickly outgrew the warehouse and will soon move into a new 4,500 square footer.
“We just signed the lease and are tripling the size of our warehouse,” Fox says. “We’re really excited.”
Importantly, the company will be able to hold more inventory and better position itself not to miss shipping deadlines even when manufacturing partners fail to ship orders when they originally promised to do so. It may mean that those lucrative “shipping update” emails that also contain discounted upsells may no longer be necessary to send.
What type of email might take their place?
“The future is all about personalization when it comes to email marketing,” Fox says. “We’re looking forward to further segmenting our list, using analytics to better tailor our message, and making sure customers understand they’re part of a movement.”
That movement, according to Fox, is powered by the charitable contributions Military Hippie makes to Women in Distress, a domestic violence shelter serving women in Florida. The connection runs deep as Fox says a woman who once lived at the shelter now works at Military Hippie which is just a few blocks away from the shelter.
To inspire women and help them transform their confidence through fashion…
That’s Fox’s mission.
Who wouldn’t want to get an email from a hippie like that?
What to Do Now
Read more email marketing case studies.