Loyalty Programs, the Future of D2C eCommerce & Subscription Commerce - Yuri Kurat from New Normal

Content + Commerce

On this episode Blake is joined by Yuri Kurat of the New Normal Agency, a Seattle based software services agency.

[N]ew Normal Agency:

From 2008, Yuri worked for a development company and after 5 years there he decided start his own project, the New Normal Agency, co-founding the business with Alex Tinyaev they began with the a goal of building custom eCommerce implementations.

What tools do you use:

Depends on the clients needs.

One of the biggest things that we discovered for agency space is when the client comes to you with what they need which seems uncomplicated but when you start talking about it there are questions that they had not thought through but you know that develops from a simple idea into something that requires special treatment.

The cost of doing business in the online retail space has gone down which makes it easy to run a business but makes it more complicated to implement something technically.

Amazon:

A real threat. Companies that were sold to Amazon are spun as a success story for example Zappos or Diapers.com but they were “Amazoned”... meaning, if amazon can come into your space and offer razor thin margins they can run you out of town.

eCommerce Challenges:

As an agency what are some of the common challenges you face, where you feel you are in the trenches working against yourself, the platform or the technology you’re working with.

People are seduced by the idea of residual income. They don’t want to sell something once. They want to emulate the dollar shave club and keep customers coming back. What we find is there is not enough education or understanding around what it takes to go from a simple online business to subscription.

Loyalty Programs:

In the past few months [N]ew Normal has been narrowing their niche of expertise into loyalty programs.

8% of customers identify as being loyal to a brand

Exemplars in the space: Starbucks & Southwest Airlines Starbucks is data driven, you don’t need to interact with anything else because you can do everything through their app. The trick is personalization and making you customer feel like they are the only customer for you. Analyze what they buy at what time, take all that metadata and privide personalized offers to them.

If you are a brand selling one kind of item, how do you get customers involved in your loyalty program?

You have find other ways to get their attention. iPhone wallet cards, build an app that send push notifications to gather usable metadata. Once you find out what else is important to your customer you can market to that.

Quotes from the episode:

“Everybody wants to do retail but more so its residual income. They want to be able to build subscription models and the subscription has to support and integrate with shipping companies and reverse logics, ex. refunds” [00:02:57]

“Half of the success of subscriptions is that people set it and forget it. It is a lot of the way you make money. So if you give them a chance to opt out or renew you’re going to lose a lot of business.” [00:10:55]

“It takes 5 to 25 times more money to gain a new customer than to keep an old one.” [00:13:10]

Links:

The [N]ew Normal Agency https://newnormal.agency