1. "ATTENTION DTC Ecommerce Brand Owners

Follow my journey of failures and success... as I scale a DTC E-COMMERCE Brand...

from ~$6,663/Month to $100,000+/Month"

Please wish me luck! ... THREAD...

2. Started working with this e-commerce brand in June 2020...

The Shopify store was at ~$6.5K/month prior to June...

The Facebook ad account was completely new and pixel was not installed!

3. We did competitor analysis using the Facebook ads library

Rather than reinventing the wheel, we analyzed competitor ads

Next, we looked into ads running for a longer period of time. Such ads would be profitable and messaging/creatives would be resonating with the buyers

4. Next we discussed the unique selling proposition with the client...

Q1> What is unique about this product? Ingredients? Process?

Q2> What are the pain points this product is solving?

Q3> How is this different from other competitor products and why should people buy it?

5. Next I used this strategy...

"Emotions and NOT product features trigger a purchase"

"People buy emotionally and justify logically"

6. Applied the BPM method of Depesh Mandalia @depeshm - He is the best person to follow if you want to learn FB ads

He explained how "People buy emotionally and justify logically"

7. Depesh Mandalia @depeshm showcased the power of selling outcome

Product: Make-up brush set: cost ~$4 (On Alibaba)

Store 1: Selling it for $20-$30 - They were selling features: nylon bristle, sponge head, etc

Store 2: Selling it for $80 (at scale) How? (see comments)

Store 2 was able to sell a ~$4 make-up brush set for $80 because they were not selling features they were selling "Kim Kardashian Look" (Outcome)

Next I used this outcome-based selling for my e-commerce client

8. In addition to product USP such as ingredients and process of making the health drink I added outcome: Improved gut health and immunity

Added reviews and detailed content on the product detail page

9. The next step was to increase the Average Order Value (AOV): It is the dollar amount spent each time a customer places an order on the store

Before running ads it was important to increase the AOV of the store. Higher AOV implies more dollar per visitor/customer

10. To increase AOV I bundled products (created pack of 4, 6, etc)

and I gave a discount 5%-10% if people purchased bigger packs

11. In just 30 days, as a result of all the optimization done till now the store conversion rate was up by +59% and AOV +7%

Thank you Tanner Larsson @BuildGrowScale your strategies helped me a lot

Listen to Tanner's podcast if you want to optimize your store

He is the best!

12. Next I set up Facebook ads targeting interests related to the product.

I used the Facebook insights to find out other related interest that I can target

Started multiple purchase objective campaigns

The client didn't want to spend more than $100/day which was quite low

13. Within 60 days...

- We adding a USPs on the product detail page
- Optimized the store conversion
- Created packs of products to increase AOV
- Started FB ads

July Results

- Improved the conversion rate by 52%
- Improved AOV by 7%
- Revenue increase by 65%

14. Facebook ads were running on a low budget (2-3 adsets) at a $30-$40 daily budget each. Getting around 1.6 ROAS

The cost of sale was around ~$40 so we would get max. 1 conversion a day

But Facebook needs at least 50 conversions per ad set per week to optimize... PROBLEM!!!

15. To solve this problem and satisfy the optimization rule of Facebook ads - 50 conversion/ adset/ week

We changed the ad structure to 1 campaign 1 adset and changed the conversion objective from 'Purchase' to 'Add to cart'

16 Our revenue marginally improved by 14% month of August... not great but not bad...

17. I forgot to mention I also started email marketing using @klaviyo

Here are the things I did:

- Set up abandoned cart sequence
- Browse Abandonment
- Customer Thank You sequence
- Customer Winback: Activating dormant buyers (people who have not purchased in the last 60)

18. Added flows in Klavio.

Learned a lot from Chase Dimond @ecomchasedimond.

He is the best person to follow if you want to learn email marketing for e-commerce stores

Presently 10% of the store sale is coming from @klaviyo

I want to improve this to 15%

19. Since the shipping cost was high, we introduced free shipping on the purchase of $150 and above in September

Not sure if this was the right move...

The average order value this month has increased by 17%

But the conversion rate has dropped by -43%!

20. Did a funnel comparison...

a) Free shipping on orders over $150+: 3.44% conversion rate

b) No free shipping: 3.85% conversion rate

=> ~10% drop in conversion rate due to free shipping!

21. So free shipping doesn't look like a major problem right now...

I see another problem area that I explained in point 13: Facebook ad campaigns need ~50 conversions/adset/week to optimize

My cost of sale is ~$40 so I need to spend at least $40*50 =~$2000 per week

22. But my weekly ad budget was ~$700 not ~$2000

I was spending less but hoping that adsets will somehow come out of the learning phase without following the 50 conversion rule of Facebook optimization

That didn't happen and most of my spend was going is the "learning phase"

23. Client was not ready to increase the budget so I changed my strategy

Changed the campaign objective from "Purchase" to "Add to cart" as I can still get 50 add-to-carts/adset /week within that budget

This way the campaign can be optimized for add to cart if not purchase

24. I did the changes in point 23 so that the campaign can exit the 'learning phase' and start performing

As expected the campaign got 95 add-to-carts (only 50 were needed) in less than a week and got out of the 'learning phase'

But there is a bigger problem now...

25. Changing my campaign objective from 'Purchase' to 'add to cart' bumped my CTR to ~4%!

And I was getting significantly higher traffic

But my ROAS dropped from ~1.5-2 to 0.77!

FB has started giving me lower quality traffic of people who are not ready to buy right now...

26. Since only ~$500 was spent on this experiment I will give it a few more days

I basically want to see that once the add-to-cart objective campaign stabilizes and gets out of the 'learning phase' will it give me decent ROAS?

27. My present top of the funnel (TOF) campaign (cold audience) Facebook ad structure:

Audience: Targeting value-based lookalike (Similar audience) of past purchases

Value-based lookalike of past purchasers are people who resemble the current high-value customers

28. Combined with the top of the funnel campaign (point 27) I am running a retargeting catalog campaign optimized for add to cart

But currently, I am not getting the required ROAS even when the campaign is out of its learning phase

So I need to again change my strategy...

29. So here is what I have tried in acquisition campaigns

Purchase objective campaign resulted in ~$40 cost per sale

Add to cart objective campaign gave ~$100+ cost per sale

Now I have changed the campaigns back to purchase objective but this time with a $30 bid cap

30. I am testing a $30 bid cap on the purchase objective campaign to get sale within $30 and thereby get a better return on ad spend (ROAS)

I know the cost of sale earlier was ~$40-$50 with a $30 bid cap I am forcing FB to give me low hanging fruits (buyers) and predictable ROAS

31. And 2 days later...

The bid cap didn't work as my campaigns stopped spending money because FB felt it cannot give me conversions within the $30 bid cap

More importantly, there is a big difference in bid cap and cost cap

32. When you set bid cap FB predicts if it can get conversions with that bid cap. It if thinks it can only then it spends money otherwise it won't spend the budget...

Usually, FB is bad at this prediction so it's better to use the cost cap because...

33. In cost cap FB spend the budget and then figures out if it can get conversions within the cost cap

Change from bid cap to cost cap still the campaigns were not spending

Maybe I have to keep my bid higher but that will make my ads unprofitable

34. Changed back to our good old default lowest bid strategy...

35. Jason @jasonportnoy is a super expert of e-commerce growth + He is an awesome person who shares his best strategies

Recently he shared that FB Lookalike(similar) audience of people who save FB/Insta post/ads is working really well for him

Testing it. Will share the results!

@jasonportnoy buddy, your idea has worked like magic!

Finally, I found an audience that is giving me 3X+ return on cold audience it is a lookalike of people who have saved Instagram/Facebook posts

In a few days, I will get more purchases for this audience then we can be confident that this 3.2X+ return on ad spend (ROI) is sustainable at scale

Another good day today!! #DTC #ecommerce #shopify #facebookads

Testing and hard work has started giving results

Keep following this thread and my journey to $100K/month