Naked Wines’ Marketing Strategy

Take me back to the early days of Naked and your marketing strategy for those early adopters.

Because we had absolutely no comparable business model and we had absolutely no idea how to explain to people how the model worked, we just started by offering people free wine and thought that was the best way to get a critical mass of people, on the site, and trying it. We just ran Facebook ads saying, free wine. We said, we’ll send you a case of wine and all we ask you to do is review them. We got 100 customers and when I last looked, something like 55 of those people, 11 years on, are still customers. Amazingly, by offering free wine, people didn’t take the piss; they actually did come along and did review the wines. Then they met the winemakers and got into the whole thing.

The next batch of people along, we thought that we just needed to make this an absolutely no-brainer deal. We started wallpapering Britain with vouchers. The fact is, it has just been so successful at bringing customers in. It still remains a significant part of our business. For as long as I can remember, people have been saying, I think vouchers have stopped working. They’ve never stopped working. They remain a very important way of bringing people in.

Talk to me about your strategy around vouchers. I think everyone has seen them, everyone gets them, in some kind of way. Talk to me about how you approached it.

It’s as simple as, we gave the first one away for free and we thought we needed to make the second tranche an absolute no-brainer offer. But it turns out that running a no-brainer offer is still the most efficient way of recruiting new customers. I think the evolution of it, since then, has been the impact of social media recruitment. A big learning there, for us, was that we had three or four attempts at trying to advertise on Facebook and all of them failed, dismally. They failed dismally, because we were just copying what everyone else was doing. We didn’t have in-house expertise; we didn’t think about it in a new way. Our ads were just saying, cheap white wine, cheap red wine, just the same as everyone else’s.

We brought in a guy, called Bryn Snelson, who just rethought the whole thing for us. What he found out was a few things. The first is, show, don’t tell. Don’t tell customers, we’ve got the right thing for you. Ask customers what they want and then go, oh, if you like those things, then we’re right for you. But if you like these things, we’re not right for you. The second thing was, giving people useful information. Instead of trying to sell to them, if you help people figure out, five common dinner party mistakes people make with wine, for example, people are fascinated by that. The kind of people you have to sell hard to, don’t tend to be good customers. They kind of people who go, that’s really interesting, I’d like to become a customer, tend to be good customers.

What we found is, not selling is the best sales technique. Every time we tried to do a hard sell, in fact, it doesn’t really work. You bring in more people, but you get low LTVs so, actually, the economics is worse. The model has evolved quite significantly. What we find, when we survey customers is, very often, when we say to them, how did you hear about Naked, it will be, a friend of mine is a customer of yours. They told me about it and then I saw an ad that you ran on Facebook and I thought it was quite interesting, and then a voucher turned up. It really is a mix now. My guess is, vouchers wouldn’t work nearly as well, on their own, in the way they did at the beginning. But because we’ve got the mix right, it remains an important piece of the business.

The vouchers were, the first wine is free, second one is X amount and you plan to have that customer for five to 10 years, or however long you want the lifetime to be?