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51 Lessons Learned from $200M+ in DTC eCommerce Sales
Darius Kunca
47 minutes read
eCommerce is both one of the hardest and most rewarding industries there is.
With the number of eCom businesses there are (just 1.7M in Shopify), it has never been more important to leverage the experience of others.
The right tip and the right time can help eCom owners grow their revenue, avoid time-consuming mistakes, and build a lasting store.
We’ve generated over $204M+ in DTC eCommerce sales, spent over $71M+ on Facebook Ads profitably and helped to build 6, 8-figure Direct to consumer brands. Along that journey, we have learned 51 important lessons to scaling in a DTC eCommerce brand.
In today’s article you’ll learn each of those 51 lessons. Using them can be the difference between scaling or not scaling your business.
With the number of eCom businesses there are (just 1.7M in Shopify), it has never been more important to leverage the experience of others.
The right tip and the right time can help eCom owners grow their revenue, avoid time-consuming mistakes, and build a lasting store.
We’ve generated over $204M+ in DTC eCommerce sales, spent over $71M+ on Facebook Ads profitably and helped to build 6, 8-figure Direct to consumer brands. Along that journey, we have learned 51 important lessons to scaling in a DTC eCommerce brand.
In today’s article you’ll learn each of those 51 lessons. Using them can be the difference between scaling or not scaling your business.
Table of Contents:
- Move Fast or Get Irrelevant
- Only 5 Metrics Actually Matter.
- Test a Lot and Don’t Be Afraid of Breaking Things.
- Focus On 1 Marketing Channel and 1 Bundle Until You Reach $1M+.
- Aim for a Higher AOV.
- Aim for at Least 66-90% Margin.
- Stalk Your Target Customer.
- The Right Words Can Unlock Any Door.
- Invest in a Website That Converts
- Don’t Overthink Branding Until You Hit the $5M to 10M+ a Year Mark.
- Leave Ego Aside, Learn From Everything.
- Use Leverage: Bring In External Funding Whenever Possible.
- Omni-Channel Marketing.
- Data Is Your Best Friend.
- iOS14 Tracking Solutions for Facebook.
- LTV Is the Game in 2022+
- Creating New Products.
- Things Will Break As You Scale.
- Identify High-Value Activities.
- Create an Irresistible Offer.
- Reframe Your Marketing to Target More Segments.
- Reframe Your Offer Multiple Times.
- Think About Subscriptions.
- Know When to Invest Into Visuals.
- Invest in CRO.
- Invest in SEO to Establish Your Position.
- Hire the Right People & Learn to Delegate.
- Build Superior Product in Preparation for Copycats.
- Start Building a Community.
- Stay On Top of Trends to Stay Relevant.
- Don’t Forget to Diversify as You’re Growing.
- Aim for a New Product Launch Each Month, Even Every Week.
- The One Who Can Spend The Most, Wins.
- Tap Into Exotic Marketing Channels.
- Leverage PR
- Do Collaboration Collections With Influencers.
- Always Have Your Pipeline Full of Professionals With More Experience Than You.
- Prepare to Deal With Copycats.
- Optimize Costs to Build Competitive Advantage.
- Tap Into International Talent And Reduce Costs.
- Plan Your Exit Early.
- Get Into Advanced Customer Acquisition Strategies.
- Become a Conglomerate of Multiple Businesses.
- Progress Towards a Small Corporate Structure When You Have 100-300 People.
- Acquire Complementary Businesses.
- Work on Incremental Gains, Keep Perfecting Everything.
- Tap Into Celebrity Marketing.
- Expand Partnerships.
- Enter Retail.
- TV Ads
- Localization Strategy & International Expansion.
Lesson 1: Move Fast or Get Irrelevant
Once you release a new product you have a window of approximately 2 years to position it in the market.
And in order to do that, you need what’s called a unique edge.
It can be your pricing, messaging, core offer, customer support, product quality, shipping time or marketing, but your offer needs to stand out in a sea of red competitors.
And in order to do that, you need what’s called a unique edge.
It can be your pricing, messaging, core offer, customer support, product quality, shipping time or marketing, but your offer needs to stand out in a sea of red competitors.
For example, one of our clients had a custom supplement company in Germany. When doing research, he found a gap in the market.
The biggest competitors took three weeks to ship the products, while he could do it faster. So after investing time and money in creating a more efficient delivery process, he could offer a 5 day shipping period. The result? $300k per month in sales by gaining a huge advantage in the market.
His product was the same, his pricing was the same, but his fulfillment times were the unique edge. Of course, with time competitors realized this and ended up copying his strategy.
That’s why whenever you find a gap based on deep market research, speed becomes king to capitalize on the opportunity.
The biggest competitors took three weeks to ship the products, while he could do it faster. So after investing time and money in creating a more efficient delivery process, he could offer a 5 day shipping period. The result? $300k per month in sales by gaining a huge advantage in the market.
His product was the same, his pricing was the same, but his fulfillment times were the unique edge. Of course, with time competitors realized this and ended up copying his strategy.
That’s why whenever you find a gap based on deep market research, speed becomes king to capitalize on the opportunity.
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Lesson 2: Only 5 Metrics Actually Matter.
There are dozens if not hundreds of metrics that you can use to grow your store. Things can get overwhelmingly fast, but no amount of information will compensate for the right information used wisely. Identifying the key performance indicators (KPIs) that matter will help you increase profits while keeping things simple.
In our experience, these are the 5 metrics that actually matter for growing your eCom store: CPA - Cost per acquisition
This metric tells what is the dollar amount to acquire a new customer. Ideally, it should be between $20-40 USD. CR - Conversion rate
This metric is a percentage of the number of people that get exposed to a certain offer vs how many of them take the desired action. For example, if 100 people see an ‘add a product to cart’ button and 3 of them click on it, the conversion rate is 3%. Ideally, it should be between 4 and 10%. AOV - Average order value
This metric tracks the average dollar amount spent each time a customer places an order on your store. When advertising online, it should be between $80 and $150, although the higher the better. LTV - Lifetime value
LTV is a data-based projection of how much will a customer generate over the course of their relationship with your brand. Our rule is to make it at least 3 times the AOV. COGS - Cost of goods sold
This metric refers to the manufacturing costs of producing the goods you sell. In our experience it should be ⅓ to ¼ of your AOV. Keeping track of these metrics will provide a high-level overview of the performance of your store, and allow for more strategic decisions.
This metric tells what is the dollar amount to acquire a new customer. Ideally, it should be between $20-40 USD. CR - Conversion rate
This metric is a percentage of the number of people that get exposed to a certain offer vs how many of them take the desired action. For example, if 100 people see an ‘add a product to cart’ button and 3 of them click on it, the conversion rate is 3%. Ideally, it should be between 4 and 10%. AOV - Average order value
This metric tracks the average dollar amount spent each time a customer places an order on your store. When advertising online, it should be between $80 and $150, although the higher the better. LTV - Lifetime value
LTV is a data-based projection of how much will a customer generate over the course of their relationship with your brand. Our rule is to make it at least 3 times the AOV. COGS - Cost of goods sold
This metric refers to the manufacturing costs of producing the goods you sell. In our experience it should be ⅓ to ¼ of your AOV. Keeping track of these metrics will provide a high-level overview of the performance of your store, and allow for more strategic decisions.
Lesson 3: Test a Lot and Don’t Be Afraid of Breaking Things.
Creating a business takes a lot of energy and focus, which is why owners can get emotionally attached to the way they’ve done things.
However, getting to the next level often requires doing things differently.
We once had a client who was stuck at a certain income level:
- We tried rotating through different landing pages
- We used different sales funnels
- We tested targeting different audiences
But nothing moved the needle in a meaningful way.
We kept testing things and decided to sell the product in a two-pack bundle and offer it at a 10% discount. 50% of the customers would buy a two-pack as opposed to a one-pack, and this strategy bumped up the average order value by 25%.
We once had a client who was stuck at a certain income level:
- We tried rotating through different landing pages
- We used different sales funnels
- We tested targeting different audiences
But nothing moved the needle in a meaningful way.
We kept testing things and decided to sell the product in a two-pack bundle and offer it at a 10% discount. 50% of the customers would buy a two-pack as opposed to a one-pack, and this strategy bumped up the average order value by 25%.
Bringing 25% more revenue per customer, paid advertising was profitable again. Their Facebook ROAS (Return on ad spend) went from 1.7 to 2.2, and then they were in a position to scale.
That’s why we say, ‘small hinges swing big doors’.
Don’t be afraid to test new and out-of-the-box ideas, because that approach is what creates the big breakthrough you’re looking for.
That’s why we say, ‘small hinges swing big doors’.
Don’t be afraid to test new and out-of-the-box ideas, because that approach is what creates the big breakthrough you’re looking for.
Lesson 4: Focus On 1 Marketing Channel and 1 Bundle Until You Reach $1M+.
It’s easy to get distracted online by all the flashy success stories of others.
But in order to reach $1M a year and even $300-500K a month, there is no need to diversify too much.
But in order to reach $1M a year and even $300-500K a month, there is no need to diversify too much.
Actually, a better route is to focus on just one main marketing channel and explore all the potential it has.
We’ve seen too many stores that get poor results because they spread their budget too thin, too early, and across multiple marketing channels. This leads them to burn money and write off that channel, prematurely saying “Facebook/Instagram/TikTok ads don’t work”.
The reality is that it takes time, money, and skill to have success in any channel. Most channels out there work, but only if you give them the attention they deserve.view of the performance of your store, and allow for more strategic decisions.
We’ve seen too many stores that get poor results because they spread their budget too thin, too early, and across multiple marketing channels. This leads them to burn money and write off that channel, prematurely saying “Facebook/Instagram/TikTok ads don’t work”.
The reality is that it takes time, money, and skill to have success in any channel. Most channels out there work, but only if you give them the attention they deserve.view of the performance of your store, and allow for more strategic decisions.
Lesson 5: Aim for a Higher AOV.
There is a balance that needs to occur between CPA and AOV. As the acquisition costs go up, AOV needs to go up to help sustain that extra cost.
At the time of writing this, your AOV should ideally be $80+ if you’re selling a $20 product.
You can always try getting more orders, but creating appealing upsells and bundles is easier.
At the time of writing this, your AOV should ideally be $80+ if you’re selling a $20 product.
You can always try getting more orders, but creating appealing upsells and bundles is easier.
Some ideas are:
- 15-35% discount when you buy a bundle
- Buy these 2-3 items + get this extra one for free as a gift
- Add free shipping after a certain threshold that incentivizes more purchases or getting a bundle
With well-thought-out upsells and bundles, you can position your numbers for a much better position to scale.
- 15-35% discount when you buy a bundle
- Buy these 2-3 items + get this extra one for free as a gift
- Add free shipping after a certain threshold that incentivizes more purchases or getting a bundle
With well-thought-out upsells and bundles, you can position your numbers for a much better position to scale.
Lesson 6: Aim for at Least 66-90% Margin.
Let’s say you’re selling your product for $100. With a ROAS of 2, that means $50 goes to advertising.
Out of the leftover $50 you’d have to cover the cost of production. About $33 would go to production and only $17 is left to cover taxes, salaries, fixed costs, etc.
That’s how out of a $100 sale you can end up making 10% to 15% profit, and it’s the reason why your product has to be priced correctly.
Hence, we use the 3X rule: to price your product at 3 times the amount it costs you to produce it.
Out of the leftover $50 you’d have to cover the cost of production. About $33 would go to production and only $17 is left to cover taxes, salaries, fixed costs, etc.
That’s how out of a $100 sale you can end up making 10% to 15% profit, and it’s the reason why your product has to be priced correctly.
Hence, we use the 3X rule: to price your product at 3 times the amount it costs you to produce it.
In fact, some of our most successful clients set their price way higher than 3X of their cost, getting 85-90% profit margins. Price is a huge factor for scaling successfully.
Lesson 7: Stalk Your Target Customer.
Entering competitive markets is a good thing because, in a sense, you’re “fishing where the fish are”.
It’s the same thing with your market. If you don’t truly understand your customer, their deepest desires, aspirations, fears and challenges, your messaging will never resonate.
It’s the same thing with your market. If you don’t truly understand your customer, their deepest desires, aspirations, fears and challenges, your messaging will never resonate.
Let’s say you’re selling a cosmetic product to professional women in their 20’s. They can use cosmetics to look more attractive, feel more confident, cover blemishes on their skin, or express their unique self.
Rather than buying a product for its features, people are moved to buy because of emotional reasons that steam from their worldview.
That’s why we advise you to know your market deeply. If you do this well, not only on a demographic level but on a psychographic and emotional level, you’ll be able to innovate faster and create products that add true value.
Rather than buying a product for its features, people are moved to buy because of emotional reasons that steam from their worldview.
That’s why we advise you to know your market deeply. If you do this well, not only on a demographic level but on a psychographic and emotional level, you’ll be able to innovate faster and create products that add true value.
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Lesson 8: The Right Words Can Unlock Any Door.
There are thousands of companies out there. Many of them offer the same products, promise similar results, and are generally positioned similarly in the market.
So, why would a customer choose one company over another? Why take the first option, rather than the second one, if both lead you to the same type of business selling the same type of thing?
The truth is no one wants to buy a product or a service because it does everything; they buy because it can do something.
Take the example of Beautycounter. This brand is famous for its skincare and cosmetic products. Their promise? ‘Clean beauty’.
So, why would a customer choose one company over another? Why take the first option, rather than the second one, if both lead you to the same type of business selling the same type of thing?
The truth is no one wants to buy a product or a service because it does everything; they buy because it can do something.
Take the example of Beautycounter. This brand is famous for its skincare and cosmetic products. Their promise? ‘Clean beauty’.
With sustainable products and eco-friendly ingredients, the company stands out and resonates with a certain portion of the market that searches just that.
The lesson is to stand for something and potentially against something. This will separate you from all the noise out there, and create not only customers but fans that gather around your brand.
The lesson is to stand for something and potentially against something. This will separate you from all the noise out there, and create not only customers but fans that gather around your brand.
Lesson 9: Invest in a Website That Converts
Monitoring and analyzing data can help you gain insight into what’s working, what’s not, and how you can improve your site for even better results.
When you use heatmaps, customer surveys, and sound principles, you can improve the user experience in your website and convert more visitors into customers.
Think about it. If you improve the conversion of your website by just 1%, that’s a huge increase in the bottom line revenue because it multiplies the result for every batch of visitors that lands on the page.
When you use heatmaps, customer surveys, and sound principles, you can improve the user experience in your website and convert more visitors into customers.
Think about it. If you improve the conversion of your website by just 1%, that’s a huge increase in the bottom line revenue because it multiplies the result for every batch of visitors that lands on the page.
Without using data to analyze your website, you’ll be forced to resort to gut reactions, personal preferences, or other unfounded hypotheses.
Lesson 10: Don’t Overthink Branding Until You Hit the $5M to 10M+ a Year Mark.
Getting the perfect font, perfect spacing, perfect colors may seem a priority. We have seen things like these often take a lot of time and they don't amount to exponential returns.
The fact is that a business needs sales to survive. Branding is not essential until you reach the $5M mark, so don't overthink it.
Time is better spent at the beginning at perfecting the product-market fit and mastering your funnel.
Once those things are in place, branding advertising can have a place as a long-term investment.
Time is better spent at the beginning at perfecting the product-market fit and mastering your funnel.
Once those things are in place, branding advertising can have a place as a long-term investment.
Lesson 11: Leave Ego Aside, Learn From Everything.
In our experience, a business is a reflection of its owner(s). That’s why working on your mindset and personal development is even more important than any marketing technique.
We’ve found that it’s incredibly helpful to put our own egos to the side and focus on the needs of the business. You have to be willing to ask tough questions like:
"Am I growing fast enough?”,
“Do I understand this topic well enough?”
“Am I the best person for this task or should I find someone that can do it better than me?”
We’ve found that it’s incredibly helpful to put our own egos to the side and focus on the needs of the business. You have to be willing to ask tough questions like:
"Am I growing fast enough?”,
“Do I understand this topic well enough?”
“Am I the best person for this task or should I find someone that can do it better than me?”
On top of that, you need to have a good balance between learning and execution.
We typically see two types of people; one type is always learning, buying courses, going to events, joining masterminds, but never taking the action necessary to achieve their goals.
The other type is always taking action, they just execute, execute, execute but don’t take the time to learn the skills that will help them. The ideal is to spend half of your time learning and the other half executing.
When done right, you’ll move closer to your goals faster, prevent roadblocks and grow as a business owner.
We typically see two types of people; one type is always learning, buying courses, going to events, joining masterminds, but never taking the action necessary to achieve their goals.
The other type is always taking action, they just execute, execute, execute but don’t take the time to learn the skills that will help them. The ideal is to spend half of your time learning and the other half executing.
When done right, you’ll move closer to your goals faster, prevent roadblocks and grow as a business owner.
WORK WITH ADKINGS
Ready To Take Your eCommerce Store To The Next Level?
Lesson 12: Use Leverage: Bring In External Funding Whenever Possible.
Just because it’s possible to grow an eCommerce business without external funding, it doesn’t mean you shouldn’t.
If you have the chance, talk to venture capitalists, use equity crowdfunding, or even pre-order campaigns. One of our clients launches his product ideas on Kickstarter before ever launching to the market, so he only produces things people voted for with their wallets.
Having external funding can be huge leverage because suddenly you can have the luxury of losing money in the front-end and take more risks. You can re-sell to clients in the back-end and generate a ton of money, while valuating your company for a potential exit. It’s better to always be exit-ready, than realizing you want to sell your company but you’re not able to do it.
Many people think: why would I give equity in my business? Think about it this way: it’s better to have 50% of a $10M business than 100% of a $1M business. That’s why you shouldn’t ignore VC funding or crowdfunding.
If you have the chance, talk to venture capitalists, use equity crowdfunding, or even pre-order campaigns. One of our clients launches his product ideas on Kickstarter before ever launching to the market, so he only produces things people voted for with their wallets.
Having external funding can be huge leverage because suddenly you can have the luxury of losing money in the front-end and take more risks. You can re-sell to clients in the back-end and generate a ton of money, while valuating your company for a potential exit. It’s better to always be exit-ready, than realizing you want to sell your company but you’re not able to do it.
Many people think: why would I give equity in my business? Think about it this way: it’s better to have 50% of a $10M business than 100% of a $1M business. That’s why you shouldn’t ignore VC funding or crowdfunding.
Lesson 13: Omni-Channel Marketing.
Whenever you pass the $1M/year mark, you can start investing in other marketing channels.
Omnichannel marketing can be advanced, but the results are worth it. Platforms like YouTube, Snapchat, or TikTok ads are new frontiers where there’s a massive opportunity for growth because there’s not a lot of competition yet.
This means lower ad cost, and more room for experimentation.
Omnichannel marketing can be advanced, but the results are worth it. Platforms like YouTube, Snapchat, or TikTok ads are new frontiers where there’s a massive opportunity for growth because there’s not a lot of competition yet.
This means lower ad cost, and more room for experimentation.
At this phase in your business, you can afford to run a test and spend $10,000 or $15,000 without worrying about whether it will crush your business.
The name of the game is experimentation.
A word of caution, though. Omnichannel marketing can get messy quickly, which is why you want to use the advanced tracking software we’ll mention in the next tip.
The name of the game is experimentation.
A word of caution, though. Omnichannel marketing can get messy quickly, which is why you want to use the advanced tracking software we’ll mention in the next tip.
Lesson 14: Data Is Your Best Friend
When you’re doing more than one marketing activity, tracking and attribution become tricky.
Imagine a scenario where someone lands on your website from a Facebook ad, doesn’t buy, and then is retargeted with a YouTube ad. He searches your product on Google, comes back to read a post on your blog, and finally buys from a friend that is an affiliate of yours.
How do you track that? What channel do you attribute the sale to?
Traditional tracking tools haven’t yet cracked the code on how to handle this complexity.
Do you attribute the sale to the first click or to the last click? How do you model people’s behavior so you can measure what’s working and what isn’t?
Imagine a scenario where someone lands on your website from a Facebook ad, doesn’t buy, and then is retargeted with a YouTube ad. He searches your product on Google, comes back to read a post on your blog, and finally buys from a friend that is an affiliate of yours.
How do you track that? What channel do you attribute the sale to?
Traditional tracking tools haven’t yet cracked the code on how to handle this complexity.
Do you attribute the sale to the first click or to the last click? How do you model people’s behavior so you can measure what’s working and what isn’t?
The solution we recommend at the moment is Hyros or Rockerbox reporting.
These two companies are light years ahead of conventional tracking software, and they will integrate your Facebook ad campaigns, SEO, PR, and any other marketing channel that you use.
These two companies are light years ahead of conventional tracking software, and they will integrate your Facebook ad campaigns, SEO, PR, and any other marketing channel that you use.
Lesson 15: iOS14 Tracking Solutions for Facebook.
With iOS14 updates, you can’t rely anymore on a pixel on your website to give you data.
Besides using Hyros for more accurate reporting, we’ve found that Conversions API helps to track buyers’ behavior.
With Conversions API the advertiser collects and sends his data to Facebook’s ad platform. All the user behavior inside Facebook/Meta can also be tracked, which is why engagement will become more of a criterion for retargeting ads.
Similar to the CAN-SPAM Act that affected email marketing in 2003, iOS14 will affect Facebook ads but it will not terminate them.
The advertising world will continue to find ways to show relevant ads to potential buyers.
Besides using Hyros for more accurate reporting, we’ve found that Conversions API helps to track buyers’ behavior.
With Conversions API the advertiser collects and sends his data to Facebook’s ad platform. All the user behavior inside Facebook/Meta can also be tracked, which is why engagement will become more of a criterion for retargeting ads.
Similar to the CAN-SPAM Act that affected email marketing in 2003, iOS14 will affect Facebook ads but it will not terminate them.
The advertising world will continue to find ways to show relevant ads to potential buyers.
Lesson 16: LTV Is the Game in 2022+
With ad costs rising, the name of the game will become LTV.
This is because re-selling to past customers is 5-10 times cheaper than attracting a new buyer. In order to scale, brands will need to affiliate their buyers and go beyond one-time purchases.
This is because re-selling to past customers is 5-10 times cheaper than attracting a new buyer. In order to scale, brands will need to affiliate their buyers and go beyond one-time purchases.
The higher the customer value, the more money you make. LTV allows you to lose money to acquire customers in the front-end and make the money in the back-end with repeat purchases.
Email marketing is an example of this. You already have your customers’ emails, and know they are interested in your product. Getting sales from email marketing is then a no-brainer because you’re not using any advertising budget in order to bring more sales.
It’s a good idea to send a weekly email newsletter discussing new products, how-to content, offering discounts, and announcing giveaways. Keep in mind that emailing your buyers list will yield higher returns than emailing your list of prospects that only subscribed to receive a coupon code.
The problem is that many people are afraid of sending too many emails. But if you’re adding value to people who want what you have, there shouldn’t be a problem doing this.
We had a client who used to send four to five emails a week, and people were okay with it. He was also okay with it—given all the sales he was making.
This frequency might not apply to all businesses, but the best way to know for sure is to test it. That’s why we recommend everyone that we do business with to embrace email marketing and not be afraid to send more emails.
Email marketing is an example of this. You already have your customers’ emails, and know they are interested in your product. Getting sales from email marketing is then a no-brainer because you’re not using any advertising budget in order to bring more sales.
It’s a good idea to send a weekly email newsletter discussing new products, how-to content, offering discounts, and announcing giveaways. Keep in mind that emailing your buyers list will yield higher returns than emailing your list of prospects that only subscribed to receive a coupon code.
The problem is that many people are afraid of sending too many emails. But if you’re adding value to people who want what you have, there shouldn’t be a problem doing this.
We had a client who used to send four to five emails a week, and people were okay with it. He was also okay with it—given all the sales he was making.
This frequency might not apply to all businesses, but the best way to know for sure is to test it. That’s why we recommend everyone that we do business with to embrace email marketing and not be afraid to send more emails.
Lesson 17: Creating New Products.
We once worked with a client that took two years to create his very first product. When we told them they had to add more, they just couldn't understand how without spending another two years into research and development.
The shortcut we gave them was just to pick up the phone and call their existing customers and ask them what they liked, what they didn't like, and what they wished that they had.
Getting feedback directly from the market is the quickest and fastest way for you to come up with a product idea.
It will literally take five minutes but you'll get so much data out of it; you’ll wish you’d had done it sooner.
The shortcut we gave them was just to pick up the phone and call their existing customers and ask them what they liked, what they didn't like, and what they wished that they had.
Getting feedback directly from the market is the quickest and fastest way for you to come up with a product idea.
It will literally take five minutes but you'll get so much data out of it; you’ll wish you’d had done it sooner.
With this approach, he could brainstorm product ideas quickly and test them with his most loyal customers first. When he found a winner, he would launch it and could repeat the process every 3-6 months.
The best ideas for your products will not come from your mind, but from the minds of your customers. Survey them frequently to understand who they are, and who they want to be.
The best ideas for your products will not come from your mind, but from the minds of your customers. Survey them frequently to understand who they are, and who they want to be.
Lesson 18: Things Will Break As You Scale.
Being mentally prepared to scale is just as important as knowing the marketing. As you scale, everything will start to break.
First of all, your ROAS will likely go down. This is because you are targeting new audiences who haven’t yet heard of you, and they need time to be introduced to your product and ideas.
But it doesn’t stop there. Your team will need to grow exponentially, so you need systems for hiring. Supply chain will need to be solid, profit margins will decrease, and your mindset will be tested.
This is the reality of scaling, which is why we advise you to focus on building solid systems in every area of your business before you do it.
First of all, your ROAS will likely go down. This is because you are targeting new audiences who haven’t yet heard of you, and they need time to be introduced to your product and ideas.
But it doesn’t stop there. Your team will need to grow exponentially, so you need systems for hiring. Supply chain will need to be solid, profit margins will decrease, and your mindset will be tested.
This is the reality of scaling, which is why we advise you to focus on building solid systems in every area of your business before you do it.
WORK WITH ADKINGS
Ready To Take Your eCommerce Store To The Next Level?
Lesson 19: Identify High-Value Activities.
We had a client that would redo their website almost every year. The worst part was that it never really improved their sales. She was literally chasing her own tail on an activity that added no value to her business, and that was hurting it.
In order to help her identify the highest-value activities to focus on, we used a tool called an ICE score. The ICE score helps you evaluate tasks in your business based on three different criteria; Impact, Confidence, and Ease on a scale of one to 10, and then calculate the average.
In order to help her identify the highest-value activities to focus on, we used a tool called an ICE score. The ICE score helps you evaluate tasks in your business based on three different criteria; Impact, Confidence, and Ease on a scale of one to 10, and then calculate the average.
The ICE scoring model allows you to rapidly assign a numerical weight to each task in your business, to easily determine their value in relation to other activities.
By using it, you can quickly pinpoint what is the activity is greatest impact potential in your business, and focus exclusively on that.
By using it, you can quickly pinpoint what is the activity is greatest impact potential in your business, and focus exclusively on that.
Lesson 20: Create an Irresistible Offer.
It's extremely hard to create an irresistible offer, but if you pull it off, it'll give you such an extreme competitive advantage that it can completely revolutionize your business.
And by irresistible offer, we mean an offer that's so good that the customer just can't say no to it. To hit the next level in your business, it becomes really important to create your own unique, irresistible offer.
One of the best examples is Lumin. Lumin offers men's skincare and sells it as a subscription. People don't want to sign up for a monthly subscription on a product that they've never tried before.
So Lumin ran a free-month-plus-subscription offer where they gave the customer a free product for the first month. And if the customer didn't cancel, Lumin automatically transitioned them to the subscription service.
This was an offer that made multi-millions of dollars and launched Lumin to an eight-figure brand. And it's all because the offer itself allowed them to scale. It was so irresistible in the eyes of the customer to get one month free, that switching over to a monthly subscription was a no-brainer.
While there is no formula for creating an irresistible offer, the first principle is to understand what your customer really wants. What is their desired outcome? What is the transformation they’re seeking? What is their end goal?
And by irresistible offer, we mean an offer that's so good that the customer just can't say no to it. To hit the next level in your business, it becomes really important to create your own unique, irresistible offer.
One of the best examples is Lumin. Lumin offers men's skincare and sells it as a subscription. People don't want to sign up for a monthly subscription on a product that they've never tried before.
So Lumin ran a free-month-plus-subscription offer where they gave the customer a free product for the first month. And if the customer didn't cancel, Lumin automatically transitioned them to the subscription service.
This was an offer that made multi-millions of dollars and launched Lumin to an eight-figure brand. And it's all because the offer itself allowed them to scale. It was so irresistible in the eyes of the customer to get one month free, that switching over to a monthly subscription was a no-brainer.
While there is no formula for creating an irresistible offer, the first principle is to understand what your customer really wants. What is their desired outcome? What is the transformation they’re seeking? What is their end goal?
Next, you want to create an offer that is absolutely outrageous—we mean something that you're actually afraid of, because you’re offering so much value to the customer. That emotional component is so powerful.
When you do something that scares you, customers sense it and it makes them feel that they're getting an amazing deal. They know there's no way they can say no to it.
If the offer scares you a little bit, it's going to connect with the audience and catch their attention. Think about Domino's and their entire “30 minutes or it’s free” angle. It works so well because the customer can’t help but take notice.
The main thing is, you have to be open to testing irresistible offers. And if you remember what we said earlier in this article, the only way to know what works is by testing.
When you do something that scares you, customers sense it and it makes them feel that they're getting an amazing deal. They know there's no way they can say no to it.
If the offer scares you a little bit, it's going to connect with the audience and catch their attention. Think about Domino's and their entire “30 minutes or it’s free” angle. It works so well because the customer can’t help but take notice.
The main thing is, you have to be open to testing irresistible offers. And if you remember what we said earlier in this article, the only way to know what works is by testing.
Lesson 21: Reframe Your Marketing to Target More Segments.
If your target market is small, you tweak your current marketing message to target additional subsegments of the market.
At one point or another, you're going to start facing a ceiling; your market has already heard about you, customers have already bought, and those who haven’t never will.
This is where you need to be a little bit more creative by targeting subsegments.
At one point or another, you're going to start facing a ceiling; your market has already heard about you, customers have already bought, and those who haven’t never will.
This is where you need to be a little bit more creative by targeting subsegments.
Say you're selling waterproof eyeliner. Maybe your original angle was targeting people who like to party and go out on the weekends.
But you can reframe your hook and start targeting people who love to travel, camp, be outdoors, go to the beach, and play sports.
Same product, same problem to solve, but totally different market.
Another option is to position your product as being the best eyeliner for women over forty: who don't go to clubs or parties on the weekends but still care about their appearance, because they work in the corporate world.
When you’re reaching the limits of your ads, landing pages, and advertorials, it’s time to start targeting your messaging to particular segments of the market.
But you can reframe your hook and start targeting people who love to travel, camp, be outdoors, go to the beach, and play sports.
Same product, same problem to solve, but totally different market.
Another option is to position your product as being the best eyeliner for women over forty: who don't go to clubs or parties on the weekends but still care about their appearance, because they work in the corporate world.
When you’re reaching the limits of your ads, landing pages, and advertorials, it’s time to start targeting your messaging to particular segments of the market.
Lesson 22: Reframe Your Offer Multiple Times.
In the last point we talked about presenting an eyeliner product in different ways. Now, we’re talking about taking that same product, and offering it in multiple formats.
That means presenting your offer not only to people that are in-market, but to people that are out-of-market and aren’t currently thinking about purchasing an eyeliner.
You’ve exhausted segments of people that are looking for waterproof, party proof, sweat proof, beach proof, eyeliner. Now it’s time to present the offer to a completely different audience.
Up to this point you were selling to people that already knew that they had a need and were looking for the best product to solve their problem. Now, we want to generate demand - and that’s where your marketing has to change radically.
That means presenting your offer not only to people that are in-market, but to people that are out-of-market and aren’t currently thinking about purchasing an eyeliner.
You’ve exhausted segments of people that are looking for waterproof, party proof, sweat proof, beach proof, eyeliner. Now it’s time to present the offer to a completely different audience.
Up to this point you were selling to people that already knew that they had a need and were looking for the best product to solve their problem. Now, we want to generate demand - and that’s where your marketing has to change radically.
The best way to generate demand is through education. Educating people and creating content that makes them problem aware positions your product as the solution.
Advertorials are the classic way of doing this.
It’s common to send people from a Facebook ad to an article that educates the consumer with a call to action at the end to check out your product. Print advertisers routinely use this technique, and you can use it in your eCommerce store too.
It’s common to send people from a Facebook ad to an article that educates the consumer with a call to action at the end to check out your product. Print advertisers routinely use this technique, and you can use it in your eCommerce store too.
Lesson 23: Think About Subscriptions.
A business that cannot generate recurring revenue will not last. And even though you might think people don’t like subscriptions, they can actually fit really nicely into what they want.
Today, consumers crave hassle-free shopping experiences, exemplified through perks like free delivery.
Subscription services play into consumers’ desire for convenience. If people don’t like subscriptions, why is Netflix a billion-dollar business?
Today, consumers crave hassle-free shopping experiences, exemplified through perks like free delivery.
Subscription services play into consumers’ desire for convenience. If people don’t like subscriptions, why is Netflix a billion-dollar business?
Subscriptions are on the rise, even for product-based businesses. Here’s some ways you can implement them:
Subscribe and Save Offer
A Subscribe and Save service — sometimes known as a replenishment or auto-ship service — provides regular, recurring delivery of a product to consumers. Usually, deliveries occur weekly, monthly, or quarterly. It’s standard practice for merchants to offer a discount per product to incentivize customers to subscribe and ensure they’re getting the best deal on the market.
Membership
A membership subscription model offers consumers access to the value an organization creates in exchange for a recurring fee. Products that are sold through the organization are typically offered at a steep discount — making the membership attractive to consumers.
Membership Boxes
Membership boxes — also known as Subscription Boxes — are subscriptions that seek to delight and thrill consumers by appealing to their sense of curiosity. They provide collections of products to consumers based on individual preferences.
With these options and others you can come up with, a subscription model can be established to tap into greater LTV and the power of recurring revenue.
Subscribe and Save Offer
A Subscribe and Save service — sometimes known as a replenishment or auto-ship service — provides regular, recurring delivery of a product to consumers. Usually, deliveries occur weekly, monthly, or quarterly. It’s standard practice for merchants to offer a discount per product to incentivize customers to subscribe and ensure they’re getting the best deal on the market.
Membership
A membership subscription model offers consumers access to the value an organization creates in exchange for a recurring fee. Products that are sold through the organization are typically offered at a steep discount — making the membership attractive to consumers.
Membership Boxes
Membership boxes — also known as Subscription Boxes — are subscriptions that seek to delight and thrill consumers by appealing to their sense of curiosity. They provide collections of products to consumers based on individual preferences.
With these options and others you can come up with, a subscription model can be established to tap into greater LTV and the power of recurring revenue.
Lesson 24: Know When to Invest Into Visuals.
When you’re hitting about $800,000 a month and knocking on the door of $1,000,000 per month, it makes sense to invest in high-quality visual assets.
Up to this point, we have not recommended investing a lot of money in this because at first it’s about testing your offer, understanding your market, refining your sales process, and streamlining your fulfilment and operations.
But once you’ve validated all of that and are making a few million dollars per year, it’s time to step up your brand presence and build that brand authority so you become a powerful force in your industry.
But once you’ve validated all of that and are making a few million dollars per year, it’s time to step up your brand presence and build that brand authority so you become a powerful force in your industry.
Things like high-quality images, videos, and website design will all become brand assets at this point.
Keep in mind, the goal for all of this is to drive conversions.
So, all of your creatives, all of your assets, all of your videos, all of your images shouldn’t just look beautiful, they should also drive sales. Hiring an agency that understands that balance will pay off in the long run.
Keep in mind, the goal for all of this is to drive conversions.
So, all of your creatives, all of your assets, all of your videos, all of your images shouldn’t just look beautiful, they should also drive sales. Hiring an agency that understands that balance will pay off in the long run.
Lesson 25: Invest in CRO.
The average Conversion Rate (percentage of website visits that end up with transactions) is around 1-2% across different industries and product types.
That means that on 100 web visitors only one or eventually two will buy your product. That’s not a lot, so we must ask ourselves how to improve it.
That’s when CRO, or Conversation rate optimization comes in. A CRO specialist or agency will analyze each portion of your website, and test different variations until they find a winner.
That’s when CRO, or Conversation rate optimization comes in. A CRO specialist or agency will analyze each portion of your website, and test different variations until they find a winner.
Just a simple change in font or text placement can drive conversions by 20, 30 or even 70% — adding a worthy increase in sales for your brand.
Lesson 26: Invest in SEO to Establish Your Position.
When buying online, it's a general user behavior to search for the brand on Google to see if its promises are real.
Your chance of getting sales is thus gone if you don't have credible information about the brand on the first few search results.
Your chance of getting sales is thus gone if you don't have credible information about the brand on the first few search results.
Actually, according to nChannel, 44% of people start their online shopping journey with a Google search. So needless to say, some type of SEO is a must when you grow.
We recommend using SEMRush to do the initial research to find a number of searches for your product category to understand the potential of doing SEO for your brand. It'll also give you detailed information about your organic competitors and how much traffic they're taking away.
We recommend using SEMRush to do the initial research to find a number of searches for your product category to understand the potential of doing SEO for your brand. It'll also give you detailed information about your organic competitors and how much traffic they're taking away.
But it's one thing to rank for your branded keywords and a whole different one to rank for your market category. That's where the money lies.
Whenever you’re ready to be positioned as a leader in your market, hiring an experienced agency is a good investment. They should be able to get your page rank first in a matter of 2-3 months.
Whenever you’re ready to be positioned as a leader in your market, hiring an experienced agency is a good investment. They should be able to get your page rank first in a matter of 2-3 months.
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Lesson 27: Hire the Right People & Learn to Delegate.
Many entrepreneurs get stuck in the never-ending cycle of thinking they need to do everything. They think that their way is the right way and that no one can do it as well as them.
While this may be true in some cases it keeps piling more work for themselves, making it harder to focus on strategic issues that will catapult the business.
While this may be true in some cases it keeps piling more work for themselves, making it harder to focus on strategic issues that will catapult the business.
The reality is that no one will ever do things the same exact way you do them.
The key to the whole process is to identify people's strengths and delegate tasks to them accordingly. If you do it right, you'll find that your employees' strengths often overshadow your own.
Your job as a leader is to define the task at hand and leverage the resources at your disposal.
The key to the whole process is to identify people's strengths and delegate tasks to them accordingly. If you do it right, you'll find that your employees' strengths often overshadow your own.
Your job as a leader is to define the task at hand and leverage the resources at your disposal.
For example, if you notice that someone is struggling with a task, you can simply ask them why they think it's not going well.
They may tell you that they don't have the right tools, or that they don't have experience solving this particular problem, or that they may have an interpersonal issue with another employee that they need your help resolving.
Now you're able to uncover a variety of opportunities to resolve conflict, further train your employees, or even change your process based on your employees' feedback.
This is how you go from micromanaging to asking questions and helping uncover problems that you can help solve.
They may tell you that they don't have the right tools, or that they don't have experience solving this particular problem, or that they may have an interpersonal issue with another employee that they need your help resolving.
Now you're able to uncover a variety of opportunities to resolve conflict, further train your employees, or even change your process based on your employees' feedback.
This is how you go from micromanaging to asking questions and helping uncover problems that you can help solve.
Your job as a leader is to ask the right questions and assign the right tasks so that your team can learn and arrive at the correct conclusions themselves.
If you continue doing this, they will feel validated and you’ll feel like you trust them, which breeds an intense sense of loyalty and really brings the best work out of them.
The reality is the only way you can reliably grow is when you learn to delegate responsibilities to your team and then allow them to unleash their creativity and exert their potential to solve any problem at hand.
If you continue doing this, they will feel validated and you’ll feel like you trust them, which breeds an intense sense of loyalty and really brings the best work out of them.
The reality is the only way you can reliably grow is when you learn to delegate responsibilities to your team and then allow them to unleash their creativity and exert their potential to solve any problem at hand.
Lesson 28: Build Superior Product in Preparation for Copycats.
Copycats are inevitable in the online world. But one thing you can do is to make your product so superior that it’s very, very hard to copy.
We’re not just talking about the deliverable. We’re talking about the user experience, the brand concept, the customer service and of course the product itself.
All of these things need to provide so much value that it’s literally impossible (or close) to copy your brand.
Think about Amazon. Even if you understood all of their processes, can you copy them?
Very few businesses could, and it’s not because the information is secret but because their processes are so well polished that only they can do them.
All of these things need to provide so much value that it’s literally impossible (or close) to copy your brand.
Think about Amazon. Even if you understood all of their processes, can you copy them?
Very few businesses could, and it’s not because the information is secret but because their processes are so well polished that only they can do them.
Lesson 29: Start Building a Community.
According to two statistics, the top 10% of your customers account for almost half of your revenue. Identifying this 10% of your customer base and putting them in a group where they can talk about your product is a huge investment.
We’ve seen product owners, specifically digital product owners, offer trips overseas and massive cash bonuses to their highest-performing affiliates.
Russell Brunson from ClickFunnels even ran a campaign a few years ago where he offered to pay a car for his top affiliates. This fun, gamified approach works very well and is worth considering as your brand community matures.
You want to give your brand ambassadors and affiliates a reward for every action they complete. The beauty is there’s so much software out there that helps make this manageable.
One of our clients started this strategy and within a month, he got 500 members in a private Facebook group. That’s a small number but it’s amazing to see 5 to 10 posts a day about a skincare product. These customers post pictures, ask questions, share advice and create a community of ambassadors.
Russell Brunson from ClickFunnels even ran a campaign a few years ago where he offered to pay a car for his top affiliates. This fun, gamified approach works very well and is worth considering as your brand community matures.
You want to give your brand ambassadors and affiliates a reward for every action they complete. The beauty is there’s so much software out there that helps make this manageable.
One of our clients started this strategy and within a month, he got 500 members in a private Facebook group. That’s a small number but it’s amazing to see 5 to 10 posts a day about a skincare product. These customers post pictures, ask questions, share advice and create a community of ambassadors.
To keep your group exciting, you can collaborate with other influencers. You can create special offers and share discounts. You can create brand ambassadors and affiliate programs.
For example, if you notice a few people in your Facebook group constantly sharing advice, posting testimonials, and offering feedback, it would be wise to reach out to them and ask them
if they’d act as a brand ambassador on your behalf. That way you’re incentivizing your biggest fans to market for you.
For example, if you notice a few people in your Facebook group constantly sharing advice, posting testimonials, and offering feedback, it would be wise to reach out to them and ask them
if they’d act as a brand ambassador on your behalf. That way you’re incentivizing your biggest fans to market for you.
Lesson 30: Stay On Top of Trends to Stay Relevant.
Much like food and fashion, eCommerce marketing is heavily impacted by trends. New, click-worthy ways to catch customers’ attention rise up all the time. Taking notice of which methods are relevant to your brand is key to staying relevant in the online marketplace.
For example, Muddy Bites has found memes to be one of their keys to organic growth – especially when it comes to partnerships.
For example, Muddy Bites has found memes to be one of their keys to organic growth – especially when it comes to partnerships.
In fact, one campaign with the FuckJerry meme page garnered almost 1M likes and blew up their traffic and revenue.
It also helped them skyrocket from #5000 to the top 50 listing on Amazon within just weeks of launching their store, and getting about 20,000 orders in just a few days.
Some trends are classics making their way back into the mainstream, and some others are new methods. And while not every trend will work with every store, sellers of all experience levels can benefit from testing current fads and seeing their impact on engagement and revenue.
It also helped them skyrocket from #5000 to the top 50 listing on Amazon within just weeks of launching their store, and getting about 20,000 orders in just a few days.
Some trends are classics making their way back into the mainstream, and some others are new methods. And while not every trend will work with every store, sellers of all experience levels can benefit from testing current fads and seeing their impact on engagement and revenue.
Lesson 31: Don’t Forget to Diversify as You’re Growing.
Warren Buffett once said, “Wide diversification is only required when investors do not understand what they are doing” He’s completely right in the stock market, but in eCommerce, we want you to diversify everything.
Your business is quite fragile. One algorithmic change to an advertising account or an issue with a supplier could cause your business to come crashing down. It’s a scary situation, so have a plan for it.
We’re not just talking about finding a few different suppliers. We’re talking about finding suppliers in entirely new countries, even continents. We’ve seen clients order one batch of product from a supplier in one country and another batch from a supplier in a different country.
We’re not just talking about finding a few different suppliers. We’re talking about finding suppliers in entirely new countries, even continents. We’ve seen clients order one batch of product from a supplier in one country and another batch from a supplier in a different country.
To pull this off effectively, you need to build a network of suppliers throughout the world and score them based on location, quality, price, and speed. Create tiers of suppliers - regularly ordering from your tier 1 suppliers.
China is the obvious choice, but suppliers in Vietnam, Central America, and Europe add value in ways that China simply can’t.
We hope you’ve never had a Facebook ad account banned, but if you have, you know how devastating it is. Or imagine being banned by a payment processor.
We’ve heard horror stories of payment processors freezing hundreds of thousands of dollars because they suspect fraud. It’s a massive blind spot for most business owners and we want you to prevent this at all costs.
China is the obvious choice, but suppliers in Vietnam, Central America, and Europe add value in ways that China simply can’t.
We hope you’ve never had a Facebook ad account banned, but if you have, you know how devastating it is. Or imagine being banned by a payment processor.
We’ve heard horror stories of payment processors freezing hundreds of thousands of dollars because they suspect fraud. It’s a massive blind spot for most business owners and we want you to prevent this at all costs.
For that reason, start investigating alternative payment providers now.
Just like some of our clients order from different suppliers, we’ve seen some clients send part of their transactions to one payment provider and other transactions to a different payment provider.
For example, they’ll use one payment processor for one month and use another payment processor another month. If you get banned or penalized by a payment processor, it can take you 30 to 60 days to appeal and reactivate your account, and that means you have absolutely zero ability to collect payments.
Overall, you need to plan for failure and expect things to collapse and expect things to go wrong. That’s better than expecting everything will go great and facing an unpleasant surprise.
Just like some of our clients order from different suppliers, we’ve seen some clients send part of their transactions to one payment provider and other transactions to a different payment provider.
For example, they’ll use one payment processor for one month and use another payment processor another month. If you get banned or penalized by a payment processor, it can take you 30 to 60 days to appeal and reactivate your account, and that means you have absolutely zero ability to collect payments.
Overall, you need to plan for failure and expect things to collapse and expect things to go wrong. That’s better than expecting everything will go great and facing an unpleasant surprise.
Lesson 32: Aim for a New Product Launch Each Month, Even Every Week.
We’ve seen that new product launches predictably spike sales for multiple clients across multiple industries.
As your business matures, and you exhaust the market, most people that would be a fit for your product will probably have already been exposed to it; often, more than once.
As your business matures, and you exhaust the market, most people that would be a fit for your product will probably have already been exposed to it; often, more than once.
Launching new products refreshes your image in the customer’s mind and gives them a reason to buy when they may not have before: never underestimate the novelty factor.
At this stage, it’s important to have a dedicated team that regularly creates and launches new product campaigns. It could be new iterations of tried and true products. It could be accessories, and products that compliment your main product.
Or it could be brand new, entirely different product offerings. Like anything in life, people develop blindness for your products. Creating something new, and launching it attracts people’s attention and is a powerful way to get people off the fence and to try new products.
Either way, for massive growth you need to have a streamlined process to developing and launching multiple products a year.
At this stage, it’s important to have a dedicated team that regularly creates and launches new product campaigns. It could be new iterations of tried and true products. It could be accessories, and products that compliment your main product.
Or it could be brand new, entirely different product offerings. Like anything in life, people develop blindness for your products. Creating something new, and launching it attracts people’s attention and is a powerful way to get people off the fence and to try new products.
Either way, for massive growth you need to have a streamlined process to developing and launching multiple products a year.
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Lesson 33: The One Who Can Spend The Most, Wins.
Forget about making a profit on ads at this level. If you want to scale aggressively, you have to play the long-term game.
That means running ads aggressively only to break even (and even lose some money), and recovering in the back-end with emails, promotions, and retargeting campaigns.
That means running ads aggressively only to break even (and even lose some money), and recovering in the back-end with emails, promotions, and retargeting campaigns.
Competition is fierce at this level, but this is the game the biggest eCom brands in the world are playing. They are here to build a long-lasting brand, not to profit from transactional purchases at the front-end.
At this level, everyone has an airtight funnel, they have a proven offer that sells, their marketing is polished, their customer support is robust and responsive, and they have a diverse chain of suppliers to minimize the threat of production issues.
That’s why they're at the level that they are and making tens of millions of dollars per year.
If you can successfully acquire a new customer and generate repeat sales, you’re going to win.
At this level, everyone has an airtight funnel, they have a proven offer that sells, their marketing is polished, their customer support is robust and responsive, and they have a diverse chain of suppliers to minimize the threat of production issues.
That’s why they're at the level that they are and making tens of millions of dollars per year.
If you can successfully acquire a new customer and generate repeat sales, you’re going to win.
Lesson 34: Tap Into Exotic Marketing Channels.
Thinking outside the box can pay really well at this moment. One example of this is combining physical and digital products.
We had a client in the skincare industry that had a ROAS of 1.8. With such a competitive niche, it was hard to increase it no matter what creatives or strategies we came up with.
That’s why we decided to test offering a digital product as an entry offer to new users. Even with a low-cost course, 7-day challenge, this changed everything.
We had a client in the skincare industry that had a ROAS of 1.8. With such a competitive niche, it was hard to increase it no matter what creatives or strategies we came up with.
That’s why we decided to test offering a digital product as an entry offer to new users. Even with a low-cost course, 7-day challenge, this changed everything.
Suddenly, we could acquire highly qualified emails for only $2-3 dollars. Offering a free-course as an exchange for the email worked the best, although you could try offering a very cheap course just to get people’s payment information.
Overall ROAS went to 3 to even 4 with this course add-on. The best thing is that you don’t even have to create the course itself; you can collaborate with an influencer in your industry to create something your customers like.
As with everything we have talked about in this article, you should test in order to see what might work.
Is it a free course? Or a low-price option? Offering the course as an entry-point, or as a post-purchase upsell? Only 1 in 5 courses work, so it’d be wise to also pre-test the course before creating it.
If done right, this strategy can increase your return on ad spend and AOV with very little cost on the back end. It can really pay off because you’re now building an audience of paying customers with very little front-end costs.
Overall ROAS went to 3 to even 4 with this course add-on. The best thing is that you don’t even have to create the course itself; you can collaborate with an influencer in your industry to create something your customers like.
As with everything we have talked about in this article, you should test in order to see what might work.
Is it a free course? Or a low-price option? Offering the course as an entry-point, or as a post-purchase upsell? Only 1 in 5 courses work, so it’d be wise to also pre-test the course before creating it.
If done right, this strategy can increase your return on ad spend and AOV with very little cost on the back end. It can really pay off because you’re now building an audience of paying customers with very little front-end costs.
Lesson 35: Leverage PR
PR is quite lucrative, but you need to approach it as an investment in the future of your brand. Over time this investment will bring more visibility, trust, and sales. After a well-executed PR campaign, we’ve seen a 40% increase in returns on paid ads.
Our advice is to be very deliberate in your PR efforts as far as execution.
Identify where your audience consumes content. Hop on a call with them and ask “What do you watch on TV? What shows do you like? What YouTube channels do you watch? What magazines do you read?” Identify where your people are and allocate a certain percentage of your marketing budget to make yourself present there.
You’ll need to figure it out based on your brand, but the more you allocate to PR, the more value you’ll get. Common numbers are between 5% to 50%.
Publicity stunts have their place, but you also want to invest in digital PR because that's the future.
In 2010 a gift basket company attempted to break the world record for the largest cup of coffee in the world. They brewed a massive 2010 gallons of coffee, dumped it into an obscenely large cup, and invited the media and the Guinness Book of World Records to document it all.
Our advice is to be very deliberate in your PR efforts as far as execution.
Identify where your audience consumes content. Hop on a call with them and ask “What do you watch on TV? What shows do you like? What YouTube channels do you watch? What magazines do you read?” Identify where your people are and allocate a certain percentage of your marketing budget to make yourself present there.
You’ll need to figure it out based on your brand, but the more you allocate to PR, the more value you’ll get. Common numbers are between 5% to 50%.
Publicity stunts have their place, but you also want to invest in digital PR because that's the future.
In 2010 a gift basket company attempted to break the world record for the largest cup of coffee in the world. They brewed a massive 2010 gallons of coffee, dumped it into an obscenely large cup, and invited the media and the Guinness Book of World Records to document it all.
So it’s even better if you can stage some sort of event and attract media attention. We’ve seen companies do wild promotions, donate to charities, or try to break world records. These strategies can all work for your brand.
Lesson 36: Do Collaboration Collections With Influencers.
Another powerful strategy you can use to get a bigger bang from your celebrity marketing efforts is to launch a collaboration edition of your product with them.
Designing and launching a limited edition of one of your products is a fantastic way to boost the LTV of your current customers to bring in new customers.
Designing and launching a limited edition of one of your products is a fantastic way to boost the LTV of your current customers to bring in new customers.
The celebrity usually has a partnership stake in the product, making it more likely to promote it for you. Even if you don’t offer a partnership stake, you’ll be able to tap into their fanbase.
Rapper Travis Scott reportedly made $20 million from his “Travis Scott” meal at McDonald’s - a medium Sprite, a quarter pounder with bacon, and fries with barbecue sauce. It was a smashing success when it was introduced in 2020.
One of our clients sold face masks and designed a new version with an influencer. He just changed the pattern and made it unique to that influencer. And that's it.
In other cases we've seen a limited edition print for a t-shirt or some other apparel item. Or you can simply add a limited edition sticker or additional print that’s related to that influencer.
We’ve seen people buy makeup just to collect it because it’s a limited edition collection made in collaboration with their favorite influencer. We recommend doing one of these collaborations once a quarter. It doesn’t have to be complicated, just consistent.
Rapper Travis Scott reportedly made $20 million from his “Travis Scott” meal at McDonald’s - a medium Sprite, a quarter pounder with bacon, and fries with barbecue sauce. It was a smashing success when it was introduced in 2020.
One of our clients sold face masks and designed a new version with an influencer. He just changed the pattern and made it unique to that influencer. And that's it.
In other cases we've seen a limited edition print for a t-shirt or some other apparel item. Or you can simply add a limited edition sticker or additional print that’s related to that influencer.
We’ve seen people buy makeup just to collect it because it’s a limited edition collection made in collaboration with their favorite influencer. We recommend doing one of these collaborations once a quarter. It doesn’t have to be complicated, just consistent.
Lesson 37: Always Have Your Pipeline Full of Professionals With More Experience Than You.
We’ve seen companies taken out at the knees because they lose key employees at critical times in their business. It’s a horrible situation and a nightmare to recover from. It’s a dangerous place to be and the best way to avoid it is by having a pipeline of candidates that you can hire and deploy quickly.
Our advice is to be very deliberate so you attract the best of the best. Just like you create a sales funnel to attract your best customers, you need to create a hiring funnel so you attract the best talent.
There are two recruiting strategies. The first is to create brand awareness around your business so that employees in the market know about your company.
Develop a reputation for being an exceptional place to work so it draws top talent to you. Convey your corporate culture, values, working atmosphere, and the impact that they could make by working with you.
A-players get the salaries they want and gravitate to an outstanding culture more so than a high paycheck. Selling new recruits on your mission, vision, culture, and work environment is the best way to attract them.
The second strategy that we’ve seen work well is directly poaching other employees from other companies. Enterprise companies do this all the time, where executive headhunters literally poach leaders from other companies and entice them to jump ship.
Carly Fiorina, the former CEO of HP is poached from AT&T and Lucent Technologies because of her notable work there. Marissa Meyer from Google was also poached by Yahoo to lead the struggling company.
There are countless examples of companies identifying, targeting, and subsequently recruiting executives; from rivals, competitors, and other industries. It’s a viable strategy for an eCommerce business of your size.
The important thing is to always be hiring. You need a process to attract, nurture, recruit, and keep top talent. You need to be proactive about filling your hiring pipeline just as you are with your sales funnel.
Having qualified candidates on standby gives you a massive edge that will propel your business forward exactly when you need it.
There are two recruiting strategies. The first is to create brand awareness around your business so that employees in the market know about your company.
Develop a reputation for being an exceptional place to work so it draws top talent to you. Convey your corporate culture, values, working atmosphere, and the impact that they could make by working with you.
A-players get the salaries they want and gravitate to an outstanding culture more so than a high paycheck. Selling new recruits on your mission, vision, culture, and work environment is the best way to attract them.
The second strategy that we’ve seen work well is directly poaching other employees from other companies. Enterprise companies do this all the time, where executive headhunters literally poach leaders from other companies and entice them to jump ship.
Carly Fiorina, the former CEO of HP is poached from AT&T and Lucent Technologies because of her notable work there. Marissa Meyer from Google was also poached by Yahoo to lead the struggling company.
There are countless examples of companies identifying, targeting, and subsequently recruiting executives; from rivals, competitors, and other industries. It’s a viable strategy for an eCommerce business of your size.
The important thing is to always be hiring. You need a process to attract, nurture, recruit, and keep top talent. You need to be proactive about filling your hiring pipeline just as you are with your sales funnel.
Having qualified candidates on standby gives you a massive edge that will propel your business forward exactly when you need it.
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Lesson 38: Prepare to Deal With Copycats.
Just recently, someone completely copied our agency website. They took our case studies, created a similar logo and color scheme, and then just changed the name.
It wasn't a very pleasant experience, but because we built up our brand and built a community around it, our community spotted it and notified us of what was happening.
We were able to contact a lawyer and resolve the situation immediately. This is an example of putting your best foot forward, positioning yourself as the market leader, and letting the market help deal with low-quality copycats.
It wasn't a very pleasant experience, but because we built up our brand and built a community around it, our community spotted it and notified us of what was happening.
We were able to contact a lawyer and resolve the situation immediately. This is an example of putting your best foot forward, positioning yourself as the market leader, and letting the market help deal with low-quality copycats.
If imitation is the highest form of flattery, consider yourself flattered. At the level of 8 figures, not only the market will have noticed what you’re doing, but so will your competitors.
We get messages and businesses contacting us for our services multiple times a month, wanting to clone the success of one of our clients. We always say no, but other agencies might not have the courtesy.
In order to copy-proof yourself, focus more on the experience than the product. From the packaging to the brand community, to your content and interaction with customers.
GymShark does a great job of creating a very tight-knit community. The CEO himself has his own YouTube channel. No one can copy any of that stuff. And you don’t need to be a big business to do that.
We have plenty of small clients who make $1-3 million per year just for making their customers feel a certain way. Sure, they may sell a cosmetic product or apparel, but they’re able to create a brand experience that transcends the physical product.
It’s that experience that keeps customers coming back over and over again.
We get messages and businesses contacting us for our services multiple times a month, wanting to clone the success of one of our clients. We always say no, but other agencies might not have the courtesy.
In order to copy-proof yourself, focus more on the experience than the product. From the packaging to the brand community, to your content and interaction with customers.
GymShark does a great job of creating a very tight-knit community. The CEO himself has his own YouTube channel. No one can copy any of that stuff. And you don’t need to be a big business to do that.
We have plenty of small clients who make $1-3 million per year just for making their customers feel a certain way. Sure, they may sell a cosmetic product or apparel, but they’re able to create a brand experience that transcends the physical product.
It’s that experience that keeps customers coming back over and over again.
Lesson 39: Optimize Costs to Build Competitive Advantage.
You can grow your business by
a) making more money or
b) decreasing costs.
Ideally you should be combining both.
One example is taxes. Every percentage that you can reduce in taxes is money that will serve you in building a more profitable business.
The book that’s been pivotal in our understanding of how to run the finances in our business is Profit First, by Mike Michalowicz. The entire premise of the book is that most business owners run their business using the age-old maxim of:
Revenue - Expenses = Profit
It makes perfect sense and has worked for ages. But Michalowicz flips the concept on its head. The entire premise of the book is that business owners tend to leave profit as a secondary item, meaning they mostly focus on generating top line revenue every month.
Over that time, they try to manage their expenses as best they can and then pocket whatever is left over as profit. His assertion is that the formula needs to be reversed. It should be:
Revenue - Profit = Expense
It's such a radically simple concept, but it reengineers your entire mindset about your business. He suggests that business owners should carve out profit before they pay any expenses, thus looking at your business as an investor.
a) making more money or
b) decreasing costs.
Ideally you should be combining both.
One example is taxes. Every percentage that you can reduce in taxes is money that will serve you in building a more profitable business.
The book that’s been pivotal in our understanding of how to run the finances in our business is Profit First, by Mike Michalowicz. The entire premise of the book is that most business owners run their business using the age-old maxim of:
Revenue - Expenses = Profit
It makes perfect sense and has worked for ages. But Michalowicz flips the concept on its head. The entire premise of the book is that business owners tend to leave profit as a secondary item, meaning they mostly focus on generating top line revenue every month.
Over that time, they try to manage their expenses as best they can and then pocket whatever is left over as profit. His assertion is that the formula needs to be reversed. It should be:
Revenue - Profit = Expense
It's such a radically simple concept, but it reengineers your entire mindset about your business. He suggests that business owners should carve out profit before they pay any expenses, thus looking at your business as an investor.
This forces you to run a lean business that prioritizes profit and eliminates waste.
Lesson 40: Tap Into International Talent And Reduce Costs.
One of the wonders of the internet is that you can connect with anyone anywhere. Using this advantage, you can tap into a pool of remote talent and reduce costs.
It’s just like with COGS. If you find an international supplier who delivers the same quality product as a local but more expensive one, why not use it?
By using platforms like Indeed, Angel.io, and Upwork, you can quickly build a dream team that resonates with your values and brings experience to the table.
By using platforms like Indeed, Angel.io, and Upwork, you can quickly build a dream team that resonates with your values and brings experience to the table.
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Lesson 41: Plan Your Exit Early.
Seventy-five percent of business owners we talk to typically want to exit their business once they hit this phase. But knowing your numbers is so critical because it helps you position the company to get the highest valuation possible.
This means you have to be very comfortable with your EBITDA numbers. That's your Earnings Before Interest, Taxes, Depreciation and Amortization. EBITDA is essentially net income, but factoring in the depreciation and amortization of your equipment.
This is a critical multiplier that people look at when they buy a business. Depending on your industry, and the sophistication of your business, your company will sell for multiples of your EBITDA.
For simplicity's sake, let's say you make $10 million in revenue per year. Let's also say your EBITDA is $1 million.
If you are a relatively unsophisticated business, you could sell for anywhere from 1.5 to 2.5 times your EBITDA, meaning you could sell the business for one and a $500,000 to $2.5 million.
If you have a more sophisticated business with a management chain and standard operating procedures in place, your business could sell from 2.5 to 3.7 times your EBITDA.
That's why we focus so much on the operations side of things. Because having standard operating procedures, the management team in place, and a business that runs itself allows you to 2X or 3X what you could sell your business for.
Not to mention, it makes your life much easier because the company doesn't require as much of your attention on a day-to-day basis.
Above this is an exciting level, where you start selling your business to private equity firms. Getting there is no small task and you typically need to be making $60 to $80 million per year in revenue. But, the multiplier jumps up dramatically from 3.7X for a small acquisition to up to 12X if a private equity firm is acquiring you.
Another strategy we've seen that you can employ for yourself is to do a partial exit, where you sell 80% to 90% of your company and retain a 10% to 20% stake.
Amazingly, we've seen cases where you can sell your 10% to 20% of ownership for almost the exact amount that you've sold your initial 80% of request for. This is because the business grew after two to three years and it has benefited from the management team that the buyer has put in place.
Planning for the exit since the beginning will pay huge dividends in the future, EVEN if you don’t plan on selling your business. It will force you to look at your business as an investment, rather than a job you hold.
This is a critical multiplier that people look at when they buy a business. Depending on your industry, and the sophistication of your business, your company will sell for multiples of your EBITDA.
For simplicity's sake, let's say you make $10 million in revenue per year. Let's also say your EBITDA is $1 million.
If you are a relatively unsophisticated business, you could sell for anywhere from 1.5 to 2.5 times your EBITDA, meaning you could sell the business for one and a $500,000 to $2.5 million.
If you have a more sophisticated business with a management chain and standard operating procedures in place, your business could sell from 2.5 to 3.7 times your EBITDA.
That's why we focus so much on the operations side of things. Because having standard operating procedures, the management team in place, and a business that runs itself allows you to 2X or 3X what you could sell your business for.
Not to mention, it makes your life much easier because the company doesn't require as much of your attention on a day-to-day basis.
Above this is an exciting level, where you start selling your business to private equity firms. Getting there is no small task and you typically need to be making $60 to $80 million per year in revenue. But, the multiplier jumps up dramatically from 3.7X for a small acquisition to up to 12X if a private equity firm is acquiring you.
Another strategy we've seen that you can employ for yourself is to do a partial exit, where you sell 80% to 90% of your company and retain a 10% to 20% stake.
Amazingly, we've seen cases where you can sell your 10% to 20% of ownership for almost the exact amount that you've sold your initial 80% of request for. This is because the business grew after two to three years and it has benefited from the management team that the buyer has put in place.
Planning for the exit since the beginning will pay huge dividends in the future, EVEN if you don’t plan on selling your business. It will force you to look at your business as an investment, rather than a job you hold.
Lesson 42: Get Into Advanced Customer Acquisition Strategies.
The one who can spend the most to acquire a customer wins. The competition at this level is brutal, and companies are always looking for another edge in their performance.
At this level everyone has an airtight funnel, a proven offer that sells, polished marketing, robust and responsive customer support, and a diverse chain of suppliers to minimize the threat of production issues.
That’s why they're making tens of millions of dollars per year, and there’s very little margin for error.
Regardless, there will always be little tweaks and optimizations you can make. It comes down to marketing and lifetime value basics: the one who can pay the most to acquire a new customer will win.
If you can successfully acquire a new customer and generate repeat sales, you’re going to win.
That’s why they're making tens of millions of dollars per year, and there’s very little margin for error.
Regardless, there will always be little tweaks and optimizations you can make. It comes down to marketing and lifetime value basics: the one who can pay the most to acquire a new customer will win.
If you can successfully acquire a new customer and generate repeat sales, you’re going to win.
Lesson 43: Become a Conglomerate of Multiple Businesses.
Most people don’t think about acquiring others because it's outside of their comfort zone, but it's an awesome way to grow revenues, gain market share, and increase your exit multiplier.
It can mean the difference between selling your business for 2.5 times EBITDA compared to 12 times EBITDA.
It can mean the difference between selling your business for 2.5 times EBITDA compared to 12 times EBITDA.
One client was making $40 million per year in revenue at one point.
His goal is to acquire four other companies in the same niche, bring them all under one roof and create this massive $100 million e-commerce giant run by the same management team, marketing, back-end, and suppliers.
Even if he acquires companies that are much smaller than his, making anywhere from $5 to $10 million per year, he's able to create this behemoth with a standardized, streamlined back-end and management team that he can sell to a private equity firm for a payday worth hundreds of millions of dollars.
He's giving himself a three-year timeline to get this all done. And at the rate he's going, we think he'll hit it.
The beauty of this strategy is that when you acquire a company, you're acquiring something that's already proven and running.
This mitigates the risk of starting a new business where you have to test the marketing messaging, build a team, standardize operating procedures, find suppliers, and the countless mistakes you face along the way. Purchasing a business that's already running eliminates all of that for you.
It also allows those companies to benefit from your sophisticated management team and processes to run them even more efficiently.
Bottom line: Acquiring other companies that are already doing well is one of the fastest ways to add revenue and gain market share to an already successful business.
His goal is to acquire four other companies in the same niche, bring them all under one roof and create this massive $100 million e-commerce giant run by the same management team, marketing, back-end, and suppliers.
Even if he acquires companies that are much smaller than his, making anywhere from $5 to $10 million per year, he's able to create this behemoth with a standardized, streamlined back-end and management team that he can sell to a private equity firm for a payday worth hundreds of millions of dollars.
He's giving himself a three-year timeline to get this all done. And at the rate he's going, we think he'll hit it.
The beauty of this strategy is that when you acquire a company, you're acquiring something that's already proven and running.
This mitigates the risk of starting a new business where you have to test the marketing messaging, build a team, standardize operating procedures, find suppliers, and the countless mistakes you face along the way. Purchasing a business that's already running eliminates all of that for you.
It also allows those companies to benefit from your sophisticated management team and processes to run them even more efficiently.
Bottom line: Acquiring other companies that are already doing well is one of the fastest ways to add revenue and gain market share to an already successful business.
Lesson 44: Progress Towards a Small Corporate Structure When You Have 100-300 People.
We’ve seen businesses grow extremely fast and then fail because they get weighed down by their own success. We’ve seen situations where people keep hiring and hiring and hiring to grow the business, but cannot define the strategic roles and processes to manage those new employees.
It becomes a situation where everyone is acting independently and haphazardly rather than in unison toward a common goal.
It becomes a situation where everyone is acting independently and haphazardly rather than in unison toward a common goal.
This is the stage at which companies generate a lot of momentum. They’ll either capitalize on the momentum or succumb to it. It’s almost like a race car without a spoiler. It will drive so fast that it’ll lift off the ground and flip upside down.
Revisiting your organization chart and constantly tuning your organizational structure helps maintain that level of coordination and control so that you grow in a focused, productive, and intentional manner.
This helps you identify your most critical positions and specifies exactly what you expect from those roles.
As the stakes get higher, it’s a good idea to hire someone who knows how to structure an organization, or to level up your own skills so you can do it yourself.
Over time, you’ll build a lean, mean cash-generating machine. As your business grows, your employees will have suggestions on how the business should run.
You should be able to define the roles and decisions within your business and map out how these different roles work together. You need to understand not only how teams operate internally, but how they operate with each other.
Mapping out these relationships and interdependencies will help you build the engine that will propel the company forward.
Revisiting your organization chart and constantly tuning your organizational structure helps maintain that level of coordination and control so that you grow in a focused, productive, and intentional manner.
This helps you identify your most critical positions and specifies exactly what you expect from those roles.
As the stakes get higher, it’s a good idea to hire someone who knows how to structure an organization, or to level up your own skills so you can do it yourself.
Over time, you’ll build a lean, mean cash-generating machine. As your business grows, your employees will have suggestions on how the business should run.
You should be able to define the roles and decisions within your business and map out how these different roles work together. You need to understand not only how teams operate internally, but how they operate with each other.
Mapping out these relationships and interdependencies will help you build the engine that will propel the company forward.
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Lesson 45: Acquire Complementary Businesses.
Mergers and acquisitions is the name of the game for the biggest companies in the world. Companies on the Forbes 100 list are making mega acquisitions on the back-end that most consumers know nothing about.
They acquire businesses for the sole purpose of getting access to their patents, their trade secrets, customer database, and manufacturing processes.
They acquire businesses for the sole purpose of getting access to their patents, their trade secrets, customer database, and manufacturing processes.
These are all acquisitions that don't have to do with the core product itself or acquiring their competitors. These are very strategic acquisitions and are intended to bolster the overall business.
You could start acquiring your manufacturers if you already account for a majority of their business. It’s an effortless conversation to either purchase a part of their business or purchase it outright.
You also could do the same thing across the entire supply chain by acquiring third-party warehouses, distribution centers, or going even further up and acquiring the suppliers of the raw materials of your actual product.
Other ideas are your marketing agency, a popular YouTube channel, a large Facebook group, or an industry-leading blog.
You can go as far up the supply chain, or as far down the chain as possible and have it fully vertically integrated with you as the owner.
This is what business at the higher level is all about, because it's very hard to grow another business and scale it from zero to $50 million compared to acquiring businesses already making $10 to $20 million a year, streamlining their operations, and turning them into $50 million businesses.
Assuming you have the cash reserves and management expertise to run a business of this size, it's a near foolproof way to grow your business.
You could start acquiring your manufacturers if you already account for a majority of their business. It’s an effortless conversation to either purchase a part of their business or purchase it outright.
You also could do the same thing across the entire supply chain by acquiring third-party warehouses, distribution centers, or going even further up and acquiring the suppliers of the raw materials of your actual product.
Other ideas are your marketing agency, a popular YouTube channel, a large Facebook group, or an industry-leading blog.
You can go as far up the supply chain, or as far down the chain as possible and have it fully vertically integrated with you as the owner.
This is what business at the higher level is all about, because it's very hard to grow another business and scale it from zero to $50 million compared to acquiring businesses already making $10 to $20 million a year, streamlining their operations, and turning them into $50 million businesses.
Assuming you have the cash reserves and management expertise to run a business of this size, it's a near foolproof way to grow your business.
Lesson 46: Work on Incremental Gains, Keep Perfecting Everything.
At this stage the majority of the growth won’t come from major changes done in a short time period, but from small changes done over time. Ideally, you’ll make hundreds of these little tweaks per year.
You’re running a high-performance company with a high-functioning team. Your marketing channels are already maxed out, and gone are the days of hockey stick growth.
Now you have to maintain a healthy sales volume and make minor improvements that you can sustain over the long term.
In most cases, you’ll make incremental gains in your 2-3 main marketing channels. It’s not uncommon to see a 2% gain on Facebook ads, a 3% gain on AdWords, and a 3% gain on emails.
And although it sounds small, it adds up quickly. It can also make a noticeable impact on your profits. We’ve seen cases of profits doubling and even tripling from these minor tweaks.
Now you have to maintain a healthy sales volume and make minor improvements that you can sustain over the long term.
In most cases, you’ll make incremental gains in your 2-3 main marketing channels. It’s not uncommon to see a 2% gain on Facebook ads, a 3% gain on AdWords, and a 3% gain on emails.
And although it sounds small, it adds up quickly. It can also make a noticeable impact on your profits. We’ve seen cases of profits doubling and even tripling from these minor tweaks.
Lesson 47: Tap Into Celebrity Marketing.
Celebrity marketing campaigns are relatively expensive. You can expect to pay $100,000 to $400,000 depending on who you hire.
If you can stomach those fees, you’ll be able to use the celebrity’s name and image in your marketing, have them speak about you, and have them promote you to their social media following. It’s the same with social media influencers.
If you can stomach those fees, you’ll be able to use the celebrity’s name and image in your marketing, have them speak about you, and have them promote you to their social media following. It’s the same with social media influencers.
Big brands use this strategy quite well. It’s not uncommon for web hosting companies, sports drink companies, and car companies to pay celebrities and YouTube influencers to promote them.
At this point, most people in your market have heard of you. Collaborating with a celebrity gives an emotional reason to buy from you. This applies to any type of product, especially consumables or items viewed as a commodity.
The trick to this strategy is to treat it like a long-term play rather than trying to profit from it immediately. You’ll want to incorporate the marketing collateral in your sales funnel - but don’t expect a major jump in sales.
At this point, most people in your market have heard of you. Collaborating with a celebrity gives an emotional reason to buy from you. This applies to any type of product, especially consumables or items viewed as a commodity.
The trick to this strategy is to treat it like a long-term play rather than trying to profit from it immediately. You’ll want to incorporate the marketing collateral in your sales funnel - but don’t expect a major jump in sales.
Lesson 48: Expand Partnerships.
Another way to grow is to expand your list of partners.
Let’s say you sell gym equipment and partnering with sports events works well for you. Or you’re selling different tools or equipment for traveling. You could have an active blog or a separate page to present the best deals for travel destinations.
If you sell products for camping, you can offer different routes or events that include discovering some kind of national park or top-rated destinations in the wild. That’s how you could collect referral fees.
Big breakthroughs are hard to achieve at this stage unless you enter a new market or acquire a new company, so it’s about stacking up little improvements over time.
Whatever is working for you, we say let’s double down on that.
If you sell products for camping, you can offer different routes or events that include discovering some kind of national park or top-rated destinations in the wild. That’s how you could collect referral fees.
Big breakthroughs are hard to achieve at this stage unless you enter a new market or acquire a new company, so it’s about stacking up little improvements over time.
Whatever is working for you, we say let’s double down on that.
Lesson 49: Enter Retail.
Once you're making $10, $20 or $30 million a year, it makes sense to dip your toes into the waters of retail partnerships. At this level, lucrative retail opportunities open up to you, but we don’t recommend that you jump into this without carefully thinking about it.
We see a lot of e-commerce companies that max out at $30 million to $50 million a year, and this is just the right point to start testing out retail partnerships, especially if you already have a quality product, a proven marketing message, and a recognizable brand.
When done right, retail partnerships can literally take a business from $30 million a year to $300 million a year. But it's not for the faint of heart.
You’ll have to price your products competitively against other products in retail. On your website you can charge twice the amount for the same product. It's a conundrum because your web customers will try to access your retail pricing.
Retail customers are very price-sensitive and can’t buy upsells, downsells, and subscription products like online customers can. Selling your product at a retail outlet is similar to selling it on Amazon, where your only differentiator is price.
Retailers also require significant investments in inventory and often won’t pay you until they sell it all. You tie up massive amounts of money in inventory with no reliable way of knowing when you'll ever get it back.
Just imagine striking a deal with a large retailer that wants you to provide product for 50, 100, even 500 of their stores. It's not something you can easily turn down, so getting the cash quickly and having the intestinal fortitude to wait until you get paid back is a tall order.
This requires an enormous amount of cash with no guarantee that it'll ever come back. We've seen many business owners crash and burn when they go the retail route. So again, we say emphatically, it's not for the faint of heart.
When done right, retail partnerships can literally take a business from $30 million a year to $300 million a year. But it's not for the faint of heart.
You’ll have to price your products competitively against other products in retail. On your website you can charge twice the amount for the same product. It's a conundrum because your web customers will try to access your retail pricing.
Retail customers are very price-sensitive and can’t buy upsells, downsells, and subscription products like online customers can. Selling your product at a retail outlet is similar to selling it on Amazon, where your only differentiator is price.
Retailers also require significant investments in inventory and often won’t pay you until they sell it all. You tie up massive amounts of money in inventory with no reliable way of knowing when you'll ever get it back.
Just imagine striking a deal with a large retailer that wants you to provide product for 50, 100, even 500 of their stores. It's not something you can easily turn down, so getting the cash quickly and having the intestinal fortitude to wait until you get paid back is a tall order.
This requires an enormous amount of cash with no guarantee that it'll ever come back. We've seen many business owners crash and burn when they go the retail route. So again, we say emphatically, it's not for the faint of heart.
Lesson 50: TV Ads
TV commercials including DRTV commercials are enjoying a rather unexpected renaissance. What’s even more surprising is that one of the driving forces behind the TV advertising resurgence is the industry you would least expect: eCommerce companies.
That’s right. And we’re not talking about the odd outlier here and there. Virtually all of the big eCommerce companies are heavily invested in TV advertising.
That’s right. And we’re not talking about the odd outlier here and there. Virtually all of the big eCommerce companies are heavily invested in TV advertising.
eCommerce marketers have learned just how effective TV is at driving qualified customers into their online sales channels.
eCommerce companies are discovering what many traditional companies already know: nothing comes close to TV’s uncanny power to raise awareness and build brand quickly and cost-effectively — especially DRTV, which is both a brand enhancer and a sales super-charger.
This really shouldn’t be that surprising because TV is, after all, the most mass of all mass mediums.
Once you're doing 8 figures in sales, it's easy to chalk out a budget to test out TV ads.
eCommerce companies are discovering what many traditional companies already know: nothing comes close to TV’s uncanny power to raise awareness and build brand quickly and cost-effectively — especially DRTV, which is both a brand enhancer and a sales super-charger.
This really shouldn’t be that surprising because TV is, after all, the most mass of all mass mediums.
Once you're doing 8 figures in sales, it's easy to chalk out a budget to test out TV ads.
Lesson 51: Localization Strategy & International Expansion.
By now you have an offer that sells. Taking it to other countries that speak the same language that you speak is a straightforward decision. If you sell to the US, you might as well sell to other English-speaking countries; Canada, England, Australia, and New Zealand.
We had an Australian client that sold to the US successfully. They also sold to other big English-speaking countries.
The funny thing is that despite being an Australian company, they couldn’t get traction with the Australian market. Most of their sales came from the United States and UK with Australia accounting for a mere 3% of their sales.
We copied their website and cloned an Australian version. We literally changed their domain from .com to .com.au, and edited a few personalizations on the website like adding the Australian flag, mentioning shipping time to Australia, and telling customers that they ship the product from Australia.
We took it another step further by localizing their user-generated content, making sure that their blog and social media strategy catered to the Australian market.
Their return on ad spend improved by 40% to everyone's surprise. We helped them spend three or four times more in Australia and 4X their revenue from Australian customers while improving ROAS.
So the secret to making this strategy work is creating a localized presence for each new market that you enter. You need a website for that country. You need a phone number for that country. You need to sell products that cater to that country.
The funny thing is that despite being an Australian company, they couldn’t get traction with the Australian market. Most of their sales came from the United States and UK with Australia accounting for a mere 3% of their sales.
We copied their website and cloned an Australian version. We literally changed their domain from .com to .com.au, and edited a few personalizations on the website like adding the Australian flag, mentioning shipping time to Australia, and telling customers that they ship the product from Australia.
We took it another step further by localizing their user-generated content, making sure that their blog and social media strategy catered to the Australian market.
Their return on ad spend improved by 40% to everyone's surprise. We helped them spend three or four times more in Australia and 4X their revenue from Australian customers while improving ROAS.
So the secret to making this strategy work is creating a localized presence for each new market that you enter. You need a website for that country. You need a phone number for that country. You need to sell products that cater to that country.
Recap
Building a thriving eCommerce business is a challenging and worthy goal that is full of trials, lessons, and growth. Whatever works for one level will not necessarily work for another; you need to be constantly leveling up.
If you follow the path of others go have walked the path before you, you can save thousands of dollars in mistakes and years blocked with what you thought “what’s your limit”.
The reality is that in today’s world, the limits for eCommerce are very, very high. And if you want to explore how far can you and your business go, we invite you to schedule a call with our team devoted to making eCom founders’ dreams a reality.
If you follow the path of others go have walked the path before you, you can save thousands of dollars in mistakes and years blocked with what you thought “what’s your limit”.
The reality is that in today’s world, the limits for eCommerce are very, very high. And if you want to explore how far can you and your business go, we invite you to schedule a call with our team devoted to making eCom founders’ dreams a reality.
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