How to build a $1 million retention marketing plan

When it comes to running an online store, getting new customers is always a focus—but keeping the ones you already have is where the real growth happens. Retention marketing, especially through email, is one of the most effective ways to build long-lasting relationships with your customers and turn them into repeat buyers. In this episode of Click To Buy, I had a great chat with Ugo Balestrazzi, an expert in email marketing and retention strategies. We talked all about how e-commerce brands can step up their game by keeping their subscribers engaged and reactivating those who’ve gone silent.

If you’ve been wondering how to boost customer loyalty and maximize your email list’s potential, this episode is packed with insights you can start using right away.

Click To Buy, Episode 29: Retention Marketing with Ugo Balestrazzi

To get the full episode, listen to it on Spotify or watch the video version on YouTube:

Understanding retention in email marketing

Becca (01:27):
I know you're big on retention marketing. Could you explain to me what retention means in the context of email marketing, and why should e-commerce brands prioritize it over short-term tactics?

Ugo (01:45):
Retention marketing is about keeping the customers you’ve already acquired engaged with your brand through various channels like email, SMS, or even direct mail. A lot of brands focus only on acquisition—ads on Meta, TikTok, etc.—but retention is crucial because the cost of acquisition is rising. If you don’t have a solid retention strategy, you’ll keep spending more on bringing in new customers, only to see them slip away. Retention, by contrast, makes sure that those customers stick around and come back to buy again.

Key metrics for retention success

Becca (03:29):
For someone setting up an email marketing retention strategy, what are the key metrics they should track?

Ugo (03:43):
You have the basics—open rates, click-through rates, and conversion rates—but to really measure success, you need to look at more advanced metrics like customer lifetime value (CLTV) and average order value (AOV). These help you understand how effective your retention marketing is in the long term, not just how well an email performs on the day you send it.

Ugo’s $1 million reactivation strategy

Becca (04:16):
A big part of retention is dealing with inactive subscribers. How can brands reactivate those subscribers?

Ugo (05:05):
First, you need to recognize that not every subscriber will stick around forever. What I’ve found works is segmenting your unengaged subscribers into smaller chunks and gradually reintegrating them with your engaged list. By doing this, you maintain good deliverability and re-engage inactive subscribers without landing in the spam folder. Typically, I can reactivate 10-30% of inactive subscribers with this strategy.

Here’s a step-by-step breakdown of Ugo Balestrazzi’s retention marketing process that he implements with brands, as described in the transcript:

Ugo’s retention marketing process for re-engaging inactive subscribers

1. Separate engaged from unengaged subscribers

   • Step 1: Start by segmenting your email list into two groups: engaged subscribers (those who have interacted with your emails recently) and unengaged subscribers (those who haven't opened your emails for a while).
     
     

2. Divide unengaged subscribers into smaller segments

   • Step 2: Take the unengaged list and divide it into smaller, manageable chunks. Ugo recommends breaking it down into groups of 1,000 to 2,000 subscribers, depending on the size of your total list.
     
     

3. Add small segments to engaged list

   • Step 3: To maintain email deliverability, don’t email the unengaged subscribers separately. Instead, add one segment of unengaged subscribers to your engaged list before sending an email. This helps to keep the overall open rates healthy and ensures the emails aren’t flagged as spam.
     
     

4. Monitor open rates

   • Step 4: After sending each email, monitor who opens it. The subscribers from the unengaged segment who open the email should be moved to your engaged list.
     
     

5. Repeat the process

   • Step 5: Repeat this process with each segment of unengaged subscribers. For example, send an email to the engaged list plus the first segment of unengaged subscribers on Monday, then send to the engaged list plus the second segment on Wednesday, and so on.
     
     

6. Clean up the list

   • Step 6: After several rounds of this process (usually 3-4 times), if subscribers from the unengaged list still aren’t opening your emails, you can either attempt a final reactivation campaign or remove them from your list entirely to keep it clean and improve overall deliverability.
     
     

7. Handle buyers separately

   • Step 7: Treat customers who have purchased from you differently than non-buyers. Even if buyers don’t engage right away, they’re more valuable and may open your emails months later. Ugo recommends spending more time trying to reactivate buyers, as they’re often worth the extra effort.

Key points to remember:

• Maintain deliverability: By blending unengaged segments with engaged ones, you keep your open rates high and avoid landing in the spam folder.
  
  

• Personalized segmentation: Always segment buyers separately from non-buyers, as buyers are more likely to re-engage.
  
  

• Monitor and adjust: Keep a close eye on open rates and adjust your strategy accordingly. If a large portion of unengaged subscribers aren’t responding, it may be time to clean your list.

This process allows Ugo to reactivate around 10-30% of inactive subscribers and maintain healthy engagement across email campaigns.

Creating engaging email content

Becca (11:53):
How can brands avoid landing in the spam folder? How do you create email content that subscribers want to open?

Ugo (13:43):
The key is creating content that’s valuable and interesting. I always suggest studying your competitors first, then doing the opposite of what they’re doing. Think of your email as a conversation, not just a sales pitch. Understand your customers' needs—whether they want to learn about health, trends, or the ingredients in your products—and tailor your content around that. Also, play with design and subject lines to stand out. Pattern interrupts, like a unique subject line or email layout, can capture attention and keep subscribers opening your emails.

Future trends in retention marketing

Becca (20:55):
What trends do you see shaping the future of retention marketing?

Ugo (21:44):
AI will play a huge role, no doubt, but humanizing your brand will become just as important. With so many brands relying on AI to generate content, things can start to feel robotic. Brands that create more personal, human connections with their customers will stand out. I also think we’ll see more emphasis on storytelling and creating memorable customer experiences, especially post-purchase.

BFCM/Holiday email strategies

Becca (24:39):
With the holiday season approaching, do you have any email strategies that work well during Black Friday and beyond?

Ugo (25:47):
First, don’t be afraid to increase your email frequency during the holiday season. People expect more emails, so it’s okay to send 1-3 emails a day during Black Friday. Another tip is to offer early-bird access to your sales for VIP customers, segmenting those who’ve bought multiple times or spent a significant amount. Lastly, each day of your promotion should feature a unique offer. Keep people curious about what’s coming next, whether it’s through daily deals or mystery discounts.

Final tip for merchants

Becca (29:46):
What’s your final tip for store owners looking to improve their customer journey?

Ugo (30:23):
Focus on the post-purchase experience. Instead of upselling right after the sale, take time to make customers feel valued. A personal email from customer service or even a phone call can make a big difference. Once they’ve had a great experience, that’s when you can offer discounts or upsells.

Final thoughts

This episode of Click To Buy was packed with valuable insights on retention marketing. Ugo emphasized that understanding customer behavior is key to creating email campaigns that keep subscribers engaged. From reactivating inactive subscribers to leveraging storytelling for a more human approach, these strategies will help you build a sustainable and profitable retention plan. If you’re gearing up for the holiday season, remember Ugo’s advice: make sure you take care of your post-purchase customer experience to ensure they keep coming back for more!