Naked Churn

Why do angels, typically, leave? Was it different by region, for the US, Australia and the UK?

There are two types of ways of looking at angel attrition. Firstly, the early angel attrition. Like all things, in the early days, attrition rates are higher. After you’ve been with Naked for about four months, we call you mature. After that, the attrition rates just drop out.

The second purchase?

Pretty much, yes. The reason that people would leave Naked was rarely wine quality. It was more that they were building up big account balances so they weren’t using it. They became disengaged. A lot of our marketing wasn’t actually trying to sell you wine. A lot of our marketing was to get you to come and rate your wine or come and talk to the wine maker because, in doing that, that activated you. You would see you had an account balance and you would use it to buy stuff.

Probably the biggest driver for losing an angel is that we just lose touch with them. We lose that engagement. Then they say, I’m not really using this now and I’ll cancel it. That was probably the number one. The second one was always health reasons. I don’t know if that was always real or is it was the easiest way to tell a wine company that have told you are really important that you need to leave. That’s the problem with that data point; is it real or, if you have spent a lot of time telling someone that they are important, are they just telling you health reasons is the reason they are leaving, as a way of not offending?

Back to the first point, it is all about engaging the customer, on the site, to make sure that they can get involved in the stories, get involved in the community, to then upsell them to buy the product?

Yes; instead of selling to them, keeping them engaged. Keeping them a part of Naked was the critical thing. We know what humans are like. We’re not thinking of Naked every minute of the day and we have different habits. Over time, we become far enough away from Naked that we say, maybe I will try my wine somewhere else or I’ll do this or that. At that point, you are a high cancellation risk. If you were inactive, for want of a better term, on a recency-frequency curve, perhaps rather than getting you to buy, we would get you to rate or get involved in Winemaker Fantasy or things like that.