This UK-based beauty brand sells supplements primarily through a subscription model. They were first to market with their unique formulation and on-the-go packaging.
This small startup has grown from an unknown player in the beauty industry to the well-known brand it is today, now being available across Europe and the United States.
The founders came to us 6 weeks after launching their product with many interesting challenges. We encountered all of the challenges below, and many more.
Due to the brands rapid growth, we had to constantly tweak, optimise and pivot on our strategy to maintain consistent growth.
They had no prior experience within the industry, and no prior eCommerce experience.
The product itself was innovative and without competitors, so there was no existing market to tap into easily. They had a very small social media presence and hadn’t seen much traction since their launch.
Potential customers had to discover the brand, be educated on the product and its benefits and build enough trust to make their first purchase.
The average order value was under £30. This is in the low range for a product looking to profit from advertising on the front end.
Despite the challenges, the product looked very promising. So we decided to partner with this client and help them grow!
Since we started with our client, more and more brands entered the space with copy-cat products.
As the brand started growing from 6 to 7 figures, initial purchase CPA costs began to increase and we put a variety of strategies in place to overcome this.
Below we have highlighted ’some’ of the strategies that we have used with our client.
We went through a rigorous process of testing different audiences such as; interest-based, data-based (lookalikes) and broad audiences.
These tests also included looking at a range of demographics such as; age & gender.
Our client came to us under the impression that their ideal client was female aged between 30-45, however we wanted to validate this through our campaign data.
Working through our framework, where we split-test audiences, we isolated audiences where performance was the strongest and most profitable. This led us to identify the most scalable, cost-effective and sustainable audiences.
From this we identified two core broad audiences, which we then later split into smaller specific personas.
These were male 30-45 and female 35-60.
We tested every style and format of creative to identify what resonated with the audience.
All of our testing was aimed at discovering the most profitable and scalable creative.
These are some of the styles of creatives that were tested:
- Product Demo Videos
- Packshot Images
- Seamless Carousel Images
- Product Images with Text Overlays
- Product Explainer Videos
- User-Generated Content
- Customer Testimonial Videos
These are some of the formats we also tested:
- 1:1 Feed Images
- 9:16 Story Images
- 1:1 and 9:16 Short Video Lengths i.e. 15sec, 30sec
- 1:1 and 9: 16 Long Video Length i.e. 1min+
We tested over 50 variations of creatives and copy, with CPAs ranging from 0.5 ROAS to 3 ROAS (a 3 ROAS on an average order value of £30 is very impressive).
The outcome of the creative testing was that User Generated Content and Founder Led Content performed most profitably, but more importantly most consistently, and are still being used to this day.
When the client came to us, they didn’t have a subscription service. So to add a recurring revenue stream, we recommended that they implement one to increase their Customer Lifetime Value (LTV).
We designed and built a subscription model, including post-purchase email flows, SMS (text messaging) and a retention funnel via Facebook & Instagram.
This meant that we had more room to play with on our front end acquisition costs, meaning we could then be more aggressive with overall budgets, as the client was very keen to scale quickly via a land-grab exercise i.e. to gain market share as quickly as possible.
We helped the founders to introduce a subscription model. Their current clients will renew their subscription 6 times on average.
With this subscription model in place we increased their advertising budget from £2-4k per month to £75k per month, with 60% of their increased monthly revenue coming from this newly created subscription model.
As the brand scaled and reached over 7 figures annually, CPA costs for 1st customer acquisition started to increase along with more competitors entering the market. The fact that we were working with one hero product also made strategy choices more limited.
We used all the tools and strategies that we use across all our clients to reduce CPAs and maintain scaling efficiency; however, we knew that the brand also needed to consider wider business changes in this instance.
Working with the founders we ran tests in 15 different markets to diversify audiences and allow room for us to scale up.
The over-arching strategy behind this was that instead of scaling in just one country (vertically) with increasing costs, we would scale across several countries (horizontally) where the path of resistance was lower, and we would be able to achieve more profitable CPAs.
We identified 5 new markets that worked and were scalable. Out of these 5, we narrowed it down to 3 new markets where we could either set up fulfilment or fulfil from the UK.
The CPA reduced by nearly 50% and we could increase budgets and maintain the level of scale that we originally had.
On top of this acquisition activity, we worked closely with the brand to develop customer journeys, retention funnels and tweak the subscription model offering.
As this was a single product brand, the only way the brand could achieve long term success and sustainability was through their subscription model offering. As a side note we heavily used in-depth customer success stories and user-generated content within the retention funnel.
Their current clients renew their subscription 6 times on average.
Over the whole journey our client went from an average of 1.7 repeat orders to 6 repeat orders, taking their average customer lifetime value from £30 to £180.
- Within 18 months we took this client from £8k to £250k per month.
- We tested over 50 variations of creatives and copy, with CPAs ranging from 0.5 ROAS to 3 ROAS (a 3 ROAS on an average order value of £30 is very impressive).
- We increased their advertising budget profitability from £2-4k to £75k per month.
- Our strategy of opening up new markets reduced their CPA by nearly 50% and we were able to increase budgets and maintain the level of scale that we originally had.
- Due to our work on the retention and subscription, our client went from an average of 1.7 repeat orders to 6 repeat orders, taking their average customer lifetime value from £30 to £180.