It’s no secret that if you decide to open up shop online, you’re in for some heavy competition.
Online retail whales like Amazon and eBay are often a potential customer’s first stop for any online shopping need, and often dominate the front pages of google’s search engine. That’s what Essential Oil and Diffuser company Art Naturals discovered as they hit the scene.
Art Naturals knew they had a fantastic product. The sleek wooden design of their diffuser was a huge hit with current customers, and the oils were a great ongoing revenue stream. They had campaigns running, and they were seeing sales come through. However, growth wasn’t happening fast enough to hit their quarterly goals. If they didn’t make a change, there was a good chance that their momentum would come to a standstill, and they’d lose their foothold in the diffuser marketplace.
To meet demands while growing their market presence, they needed to Spend less per customer while making more sales AND netting a profit.
Normally, an ecommerce startup focuses on sales then scales to profit. Going for both sales AND profits at the same time was an ambitious goal with low chances of success. However, taking calculated risks is what sets apart the businesses that ‘thrive’ from the ones that struggle, and Art Naturals knew this.
Art Naturals decided to bring on a dedicated eCommerce advertising team that had the track record of creating campaign wins for similar situations. After hearing a reference from one of our previous clients who we got record sales for, they approached us at Cubatica and asked if we would take on the project.
Would we be able to hit their goals, while also lowering the cost per lead?
We were aware of the high hopes they had for the campaign. It was an audacious goal, and to be executed properly, we needed to be sure we’d have the flexibility and budget to create the campaign they needed. We started with a strategic call to discuss what they had in mind. After talking to the Art Naturals team, and taking a look at their assets, we knew they had the insight and ability to let us do what we do best – create and execute a winning campaign.
We went all in – and it paid off big.
Over the next several pages, we’re going to detail for you the steps we took to get Art Naturals the winning campaign results they were hoping for, including:
- How we were able to lift their purchase conversion value by 400% in the first month
- The steps we took to maintain a 20% average purchase conversion rate steadily over the following months
- The strategy we used to net Art Naturals an extra 300k in revenue in the last month of the year
- How we lowered their CPA by 55% (and it keeps dropping)
- And how we helped them make a profit through the entire campaign.
As you go through this case study point by point, we’ll share our process with you. Look over our shoulder and learn from what we did, as well as find leverage points in your own business.
Here’s what we did:
First, we immersed our team into every aspect of Art Natural’s backend and ad campaign management.
One of the first things we do when we start working with someone is integrate ourselves into their business. That means, accessing their backend funnel accounts, their admin accounts, and their advertising accounts. This allows us to do a few things.
First of all, we get a front row view of how operations are being run and how campaigns are managed. This lets us quickly make adjustments without needing to go back and forth between the company and their internal team, allowing for faster implementation and results.
Second, we’re able to compile data to help us track where bottlenecks are happening in the profit flow, so we can ease them up and make the company more money.
Once we were in, we saw their inner marketing team needed an overhaul. At the time, the ad campaign was not clearly organized, making it difficult for them to measure and test what was working, and what was just wasting money.
Cubatica Insights: Your marketing team needs to be TIGHT. If there’s no team, we go in and set everything up. Then we help you select a long term in-house marketer and set them to run your campaigns successfully. If there already is a team, then ensure they’re keeping track of data and using structured metrics to see what is working and what isn’t so your advertising money goes farther.
To make things move smoothly, we took over the campaign management, and got to work.
We found the team had been running facebook campaigns targeting general audiences. Generally, you want to get your customer profile tightly targeted, so you don’t waste money displaying ads.
Further, there were several ads in random groups, all running without being specifically labeled or organized. This is an issue because poor organization makes it harder to figure out which ads are performing for you, and which ads aren’t. That means, a lot of unnecessary guess work, and -you guessed it – more money wasted.
Once we noticed that their ads weren’t organized, we immediately stepped in, and created a naming convention in order to sort ads and quickly split test.
Doing secret customer research
As we all know, the more you know your customer, the better you can tailor your ads to them, and the better the results you get.
We started by doing our research. We went through a spectrum of competitor research using our own set of audience analyzing tools. We went to amazon, ebay, and any major retailer that sold diffusers to see what sort of related products their customers were buying.
This allowed us to develop an interest map that we were able to use on Facebook. We found groups related to the interest and developed targeting around them. Next, it was time to test these variables one by one to see what worked, and what didn’t.
We kept the ads the same so that the only variable was WHO we were showing that ad to. This would create more accurate data as we culled the groups that weren’t performing, while slowly combining the interest, ages, and and gender that was getting Art Naturals results.
With the ads organized, the data began to flow in fast, and we quickly were able to create a targeted customer profile.
Next, we wanted to make sure everything was ready for the best possible customer sale experience – and the highest profits and conversion values.
We got to work setting up abandon cart sequences and upsells to create a huge jump in conversion value
We noticed that there were no abandon cart sequences or upsells in place. If you run an ecommerce business, an abandon cart sequence is a HUGE leverage point for making your customer value go further. This is often an email that is sent out to a customer who added things to their cart, but didn’t complete the purchase.
With the low attention span of the average internet user, abandon cart sequences allow businesses to remind customers of what they left in their cart. On average, an eCommerce business will see a 10-20% response rate when they run a sequence, which can mean a significant increase in sales.
We created an email sequence that notified users that they had left diffusers and oils in their cart, as well as offering an incentive to purchase immediately.
This helped reduce the CPA by over 50% and increased their conversions steadily over the next few months at a rate of 20-30%
Then, once customers placed an order, we created the strategy of setting up an upsell page that had a one-time offer. Customers would be able to add additional items to their current purchase at reasonably discounted prices – if they bought immediately.
Here’s what we put together:
These two strategies alone created a significant increase in the purchase conversion value, adding over 100k to the base revenue of a single month without making any other changes in traffic.
Funnel set, customers set, ad engagement set – time to ENGAGE MARKETING.
Now that we knew our customers and had the funnel in place, we begun to turn up the heat on the ads.
First, set up groups of ads, and began to run them. Since social proof will often help sell products, especially physical products, we set up an ad container for each, so all of the social sharing would get targeted back to one ad, and build the momentum.
Our strategy was simple. We didn’t go for the sale on the front end. We knew we were going to lose money on that first ad. We did however want to get people clicking and landing on the page. This would allows us to track the customer with a pixel.
After they were tracked, we set up a series of retargeting ads to show up in a strategic time-frame period. Now that the customer had made first contact with us, we were less of a ‘cold’ impression for them. We then posted ads that had compelling offers, like certain bundles or gift packages if they bought clicking through the ad. This is where we made the majority of first-contact sales.
Now, this strategy only works if you can keep the CPA (cost per acquisition) low enough, so that you can afford to lose the money at first. We were able to make that work because we knew which ads were performing well, and which ads needed to be cut.
Knowing which ads work and which ads don’t – The Pivot Point That makes This Formula Work.
Now, what makes our ad strategy interesting, is Facebook doesn’t currently have a way to tell campaign managers which front end ad the re-targeted audience that is coming from.
That means, you can’t actually know for SURE which front end ads are getting you the potential buyers, and which are just wasting clicks. Even though the front end ad’s job was to get the click, we needed ultimately to get the clicks from leads who would later become customers.
That means there is a level of data assumption going on in order to determine if a certain front end ad is really getting you the clicks you want or not. What we have done, is we’ve created our own internal data-measuring strategy that is able to give us a high probability of whether or not a certain front end ad is responsible for sales-lead clicks or not.
This is a detailed process that is a bit more in depth than the scope of this case study. However, you can reach out to us here if you are running campaigns, and would like to have us implement or show you this strategy.
As we pulled ads that weren’t performing, and pumped more funds into the ones that were, we began to see the CPAs continue to drop, while Art Natural’s revenue and purchase value skyrocketed.
Setting up Art Naturals for Continued success
Now that the campaigns and funnel were revamped, we set up a plan to continue to go in and optimize their accounts on a daily basis. This ensures they continue to get the lowest CPAs, while maintaining steady growth.
Cubatica Insights: With all the clients we work with, once the general campaigns are set up, we generally ensure we maintain quality by working in their accounts daily. We find this creates the best long term campaign results, and ensures our clients the highest revenue margins. We then either continue as long as it benefits the client, or we hand off the campaign to their inhouse team with consulting as needed to keep things on track.
After 6 months of working together, we increased their purchase conversion value by 404% in the first month – and they continue to enjoy a steady rise each subsequent month.
We’ve also lowered the cost to acquire new customers, and increased their ROAs.
You can check it out here:
|Month||Scale Rate %||CPA Change %||Purchases||Purchases Change %||ROAS %|
More resources for leveraging these insights for your own business
Now, there’s no secret that a 400% jump is just insane. However, when you’re working in the day to day of your business, it can be easy to gloss over potential profit points available to you right now – you just have to know where to look. We find even the most savvy eCommerce companies have on average a 50%-200%+ purchase increase leverage point that they’re just sitting on, month after month. And that’s exactly what we found for Art Naturals.