How We Sell – Matt Himel, Head of BD & Partnerships, Drop Loyalty
The follow-up after a first meeting is a challenge for almost every seller. How do you stay in touch, and continue being relevant when there’s not necessarily anything new to say.
That part of the sales journey is explored in depth in this How We Sell conversation with Matt Himel, Head of BD & Partnerships, Drop Loyalty. Matt’s creative approach to retaining that high level of engagement, and his creative use of both a unique data asset and his internal team are worthy of a read.
Here are Matt’s insights into how he sells:
Let’s start off with Drop – what do you offer to the world as a company?
Drop is a new approach to loyalty and rewards. We serve a large population of consumers, many of whom are in the 18-35 year old age bracket, and are members of many rewards programs, but not highly engaged with any of them. As they don’t spend enough money with any individual shop, it doesn’t make it worth their while to stay a member.
Our idea was to take your spend at a variety of merchants, aggregate it, and still encourage you to increase your spend with each merchant on an incremental basis, but make it more worthwhile and more engaging for you as an individual consumer.
We want to make it extremely simple for the consumer to redeem points. That moment when you first redeem points, and in doing so, connect the spending to the reward, is a magical moment. As you do that, you begin to spend more and earn more points.
For the most part, we do this all without having to plug into the merchants themselves. We see the transaction on connected financial accounts and reward you with points seamlessly.
What part of the go-to-market strategy do you focus on?
It’s a two sided marketplace where we need both merchant brands to fund points that you can earn for shopping with them, and members to spend with those brands and engage with them. My focus is on the merchant partnerships. The more exciting the merchant partnerships we have, the easier it is for our marketing team to go out and acquire members, but that’s their job, and my job is to acquire the merchant partners.
What does the buyer journey look like for a merchant partner? How do they discover Drop and what you offer?
One interesting way that we get merchant partners is actually from the user base. We’ll have a user who is on Drop, seeing competitor brands and brands that are tangential to their space, and spending money in order to earn points. That user will then start to look for how they can get their own company represented on Drop.
There was a lot of that type of inbound initially, and it was enough to build a solid base. To build on top of that, however, we needed a more proactive reach-out strategy.
The key for us in proactive outreach is to be sure that we are solving problem 1a or 1b for the person we’re talking to. If it’s not at the top of their priority list, it’s very difficult to get the deal done. There’s a general view that it has to be top 3, but in all honesty, we find that it has to be 1a or 1b. If acquiring new customers is not in that position for a person we reach out to, it will be very difficult to get them through the sales cycle.
When we reach out to brands, we have a pretty compelling pitch in that we see where our members are spending. We can reach out to the person responsible for new user acquisition and say “we see that they are not spending with you, how can we work together to get them spending with you?”.
Let’s drill in a bit on that reach out strategy. So many revenue organizations really struggle with how they connect with organizations that they have not yet connected with. Can you give us a bit more color on how you approach that?
The best advice I ever got was to reach out to companies who are doing something similar. For us, that can be a brand who is either working with a competitor or working with a tangential but related product.
In my past role at Tilt (later acquired by AirBnB), when we launched in Canada, for instance, people were not familiar with our approach, but when we launched in France, the concept had already been explored a bit, and the reception was much stronger. There was already a competitor in the marketplace, so our organic uptake was extremely strong because we didn’t have to educate the market on what we were doing.
At Drop, when I reach out to merchant partners that are doing something similar, we have a starting point for a conversation. We can start with a message of “I see you’re doing X, let me tell you about how Y builds on that concept”. In one example when we reached out to merchant partners who were using a similar, but older version of our approach, we were able to get a 60% response rate to that initial outreach.
Is that reach-out more of a competitive replacement or a complementary approach?
Our biggest hope is that their current approach is working well for them. We offer a similar concept, but it’s additive to what they are doing, so if the original approach is working they’ll often be happy to increase their efforts in a parallel way.
The conversation is much simpler as they are already familiar with the approach, the terminology, the results to expect, and what to watch for. Companies who have already invested in similar approaches will also often have dedicated roles for the function, such as “customer acquisition” in our case. That helps us identify the people who will have this challenge as their priority 1a or 1b.
Once you’ve made that initial connection, where does the buyer journey go from there?
I’m a big fan of the surprise and delight approach. For example when we have a first chat, and it leaves off with the usual “thanks, I’ll follow up”, I try to pull together a mock of how things would look specifically for their business that will impress them and greatly surpass their expectations.
Doing all that heavy lifting and creative work really brings it home for them as to how things would work. That level of surprise usually leads to a “wow, that looks incredible, can’t wait to get started.”. I never tell them that we’re going to send that material in advance, it’s all a surprise.
Attached to that, we’ll have a quick two-pager contract that they can sign to get started, and we’ve tried to keep that very light and non-contentious so it does not get in the way of the buyer’s excitement.
Tell me a bit about the buyer’s emotional response when they receive that? Why does it work so well?
It’s a combination of comfort and excitement. There’s comfort that the Drop app is real, there’s substance there, and that it will look really good when it goes out to our growing member base. It feels like something that they could show their boss.
There’s also excitement when they see the offer and think “if I got this, I would definitely spend on it!”. There might be a bit of bias as they, of course, work for the company, but the excitement is very much there. They want to see if their own excitement would be shared by the people that the offer will go out to.
Logistically, building that custom material is a very non-standard part of the sales process. How does that happen internally? Who is responsible for it?
It started out very bespoke. One of our founders is our head of design, so we went to him early on with a very important pitch we were working on – I think it was major US airline – and asked him to spend some time building out a more tangible experience for them of what it might look like. It worked really well. From that point on, with every new pitch, I kept going back to the design team to ask for one more favor.
Finally one night, out of frustration, our head of design built an automated templating system that creates a fully branded client pitch with about 10 minutes of work. As a startup, everyone is in it together, and applying this type of creativity to the process of acquiring new merchants is something that helps us all win.
What happens next in the buying journey?
Drop has a really interesting product story which is that when you launch an offer it usually does very, very well. You push an offer, it reaches a user’s Drop app, and the brand becomes top of mind immediately. However, after a few weeks, the results will start to tail off a bit as people become accustomed to the offer. We’ll reach out at that point, and say “great, we’ve had a wonderful first month, how can we improve this?”. As a second step, perhaps, we’ll move to an ongoing offer that grows the spend on a per-customer basis.
This approach of seeing quick early results, then growing from there into the next logical step on the back of that success, works so much better than an upfront structure that sets out a longer sequence of campaigns without having first achieved the successes for the customer.
Both from a customer perspective and from a campaign perspective, we want to make sure that every time things start to hit a bit of a lull, we’re there with the next idea and the next step forward.
How do you measure and anticipate those dips and valleys in the customer journey? How do you know what to look for?
When we were 10 people, it was completely manual. We would look at the data and compare that to our experience in building customer success. As the team began to scale, we put a dedicated role in place to monitor those things. In parallel, we built out some email templates and messages for common parts of the follow-up process.
It’s still not fully automated, but there are processes in place that monitor for dips. Not every company has the same dips, but our team is very conscious of the nuances of buyer behaviour and works hard to find ways to keep every customer moving forward on that march towards long term success.
Those are great insights, thank you Matt!