Industry: Skincare
Business Question
The team was looking to understand whether gifts with purchase were effective in building a strong customer base. Should general discounts on the first purchase be considered to replace the gift with purchase offer?
The Solution
Using analytics from Decile, they discovered that customers who were acquired with a gift with purchase had an LTV which was 78% higher than customers acquired without it. However, the type of gift with purchase did not have as much impact on overall LTV.
The Result
The business stopped changing the gift with purchase on a monthly bases, instead focusing on one gift with purchase per season. This resulted in a decrease in miniature products costs, and reduced the monthly advertising spend.
Looking at a six month post-acquisition window, the repurchase rate of customers using a gift with purchase averaged between 40-50%. In comparison, those who didn’t use a gift with purchase had a repurchase rate of 30%.