The issue at hand
As the retail industry has evolved towards e-commerce, so have the costs of acquiring new customers. In 2013, merchants spent $9 on average for every new customer. Today, this number has reached $29, a 222% increase that now makes digital marketing unprofitable for many retailers and brands.
The increase in customer acquisition costs is a result of a number of factors: increased competition from larger retailers, higher customer expectations and loyalty to brands, and more sophisticated technology used by e-commerce sites. As a result, it can be hard for small businesses to compete if they don't have a solid marketing strategy in place.
To extract more value from existing clients, email marketing has become a must-have. But, from a customer perspective, most emails are spammy and impersonal. Marketers send out the same emails to everyone in their audience, without taking into account a customer's particular preferences or buyer persona. As a result, most marketing emails end up straight into spam. On average, only 25% of marketing emails are opened and read.
When done right, email marketing can be one of the most effective ways to build long term relationships with customers. But the modern email stack has become increasingly complicated and time consuming. Newer email marketing tools have unlocked an unprecedented level of customization and granularity. But it came at the cost of accessibility for smaller brands. These brands, often managed by (very) small teams, lack the technical expertise to go beyond basic funnels, which prevents them from unlocking customization at scale.
At the time of its release, Mailchimp was a revolutionary tool that allowed users to aggregate contacts and send them emails. However, as the years have gone by and new technologies have emerged, it has become clear that this first generation of email marketing tools is no longer sufficient. While it has evolved over time and still offers some great features, its design software lacks flexibility, its customer list management feature is limited, and it was not built with goal-related automations in mind.
In 2012, Klaviyo was founded, marking the beginning of the second generation of email marketing software. Built with flexibility in mind, Klaviyo added a new layer of granularity. Marketers could finally segment build precise retargeting funnels, segment their audiences, add unlimited custom fields, and directly capture online behaviors from their CMS. However, it quickly appeared that the tool requires a specialized, experienced marketing team to fully take advantage of its value.
In fact, the data collected by email marketing platforms are often so complex that marketers require advanced analytics tools and machine learning algorithms to be able to glean actionable insights from them. This means that while leveraging and optimizing collected data seems like the right option for making efficient email marketing more accessible, in reality it's still just not feasible for most companies. As a result, most brands limit themselves to 3 basic audience retargeting campaigns: Website viewers, add-to-carts, and post-conversion retargeting.
And this is what led us to Kiliba.
To truly take advantage of massive amounts of data, marketers have to go beyond the human brain. Artificial intelligence can be used to build customized email at scale. Automation can help build emails that integrate the right verbiage, products, images and call to actions based on the behavior patterns of your subscribers—all without requiring any manual input from human beings.
Today, we’re betting on Kiliba to meet the challenges of email marketing and build the first AI-driven marketing automation software. Kiliba is a simple, yet powerful tool that helps companies manage their email campaigns. It connects directly to a retailer’s CMS, so they can create campaigns in just a few clicks.
With Kiliba, retailers can:
These features significantly increase campaign performance, as shown by Kiliba’s impressive numbers: The platform boasts an average open rate of 52% (and up to 80% for their best clients) and a return on investment 50% above email marketing benchmarks.
To understand the Kiliba story, one has to understand its founders, Amaury Hug de Larauze and Arnaud Becker. Both are marketing automation specialists, having worked together in the relationship marketing industry for more than 10 years. The two entrepreneurs launched this project with the goal of creating an intelligent emailing tool that makes it easier for small business owners to unlock the value of their audiences. They are customer-obsessed and perfectly understand their target clients, pain points, having faced them for a decade.
With just over one year of existence, the company has been building relentlessly to get its product to market. It has built an email marketing platform that is easy to use, but also packs a lot of powerful features designed specifically for companies with limited resources such as startups or small businesses
And in only 18 months, Kiliba has gone from 0 to 1M€ of ARR and has signed more than 400 customers. Throughout our diligence, we were impressed by the founders’ learning appetite. Amaury and Arnaud are not afraid to seek feedback, and showcase the combination of humility and high ambition that we seek to find in every founder we back.
At Bleu, we are thrilled to join Otium Capital, French Founders, and brilliant business angels to support Kiliba’s growth. We’re determined to help the team generate more sales and conquer a $11bn market!