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CASE STUDY

DEALMAN

BRAND STORY

The astonishing growth of platforms like Aliexpress, DHgate, and Alibaba, specifically in unbranded fashion, drew the attention of the founders of Deal Man. Founded in 2013, the idea was simple: find a way to sell fashion directly from their manufacturer at extremely low prices, but brand it effectively through modern social media platforms, and add a westernized customer service experience.

GOAL

The founders of Deal Man clearly emphasized from day one that their ultimate goal was to run profitable ads at all times. They set their initial goal of 1.5X ROI on their ads, and a monthly spend of $100,000 per month. As long as we could reach the ROI, monthly spend was unlimited.

The astonishing growth of platforms like Aliexpress, DHgate, and Alibaba, specifically in unbranded fashion, drew the attention of the founders of Deal Man. Founded in 2013, the idea was simple: find a way to sell fashion directly from their manufacturer at extremely low prices, but brand it effectively through modern social media platforms, and add a westernized customer service experience.

The founders of Deal Man clearly emphasized from day one that their ultimate goal was to run profitable ads at all times. They set their initial goal of 1.5X ROI on their ads, and a monthly spend of $100,000 per month. As long as we could reach the ROI, monthly spend was unlimited.

ROI

2.2X

GROWTH IN SALES

200%

 CUSTOMER GROWTH

20X

After 12 months of working with Freshoods, we managed to increase their revenue directly from their ads, grow their global revenue by 5.5 times. Freshhoods had to expand their manufacturing operations to support the massive amount of increase in orders. 

During the next 12 months, Freshhoods is planning to increase their monthly advertising spend gradually so they keep up with the huge number of orders without being slammed with backorders. Having orders pour in at a rate you don’t expect is a good problem to have, but they decided to gradually increase to ensure maximum quality.

CHALLENGES

Knowing that we need to achieve the minimum daily spend of $3,000 per day with an ROI of 1.5X, made us think through of what strategy we could possibly use to create a massive change in performance to be able to reach these goals. Prior to hiring us, Deal Man ran their ads in-house and spent more than $500,000 with an ROI of 1.1X. That meant that we had to create a dramatic change to either lower the CPA by 35% or increase ROI of 35%. At first glance, it looked like a mission impossible. Improving campaigns by 35% is not the main challenge, but making it happen in 30 days seemed impossible.

Strategy

We had 10 days to do our research before the launch date, so there was not one minute to spare. After two days of analyzing the entire campaign’s lifespan, Google Analytics, and their backend store, we found a breakthrough! There is a reason they say the devil is in the details. 

When examining their analytics, we noticed that there were specific products with extremely high conversion rates. Although their average conversion on the website was about 3-4%, we noted that their lowest price items that range from $8-$15 had unheard conversion rates of as high as 12% for prospecting traffic! A conversion rate of three times the average on the website was a golden opportunity to create doorbuster campaigns. 

 

The logic was simple. If we are able to capitalize on the data and promote only the products that have a 3X conversion rate, those products will also have a 66% better cost per purchase, since they convert amazingly.

 

Then one of our strategists suggested the following. Instead of promoting all of the products and getting mediocre results, why not focus the entire budget only on the best ones? So we looked at the products that will likely have the best performance based on their astonishing conversion rate. 

 

Then, we created a doorbuster strategy. From the entire product feed on the website, we excluded 91% of the products and were left with 9% of the products, which all had exceptionally high conversion rates and extremely low price tags. We created doorbuster campaigns that are strongly geared towards immediate purchase intent, where we focused heavily on the price and offer. In addition, we used copy in each campaign to promote urgency. 

 

We launched each product as a standalone campaign using campaign budget optimization (CBO). Each product was launched with three different text variations: aggressive sale copy, regular sale copy, and product focus copy. Then, we segmented ad sets by audiences using the following segmentations: existing followers, pure prospecting traffic, all people who viewed content in the last 180 days. 

 

In addition, we created specific DABA (dynamic ads for broad audiences) campaigns using only these top-performing products. Instead filling the Facebook catalog with all the products in the store, which would result in an average to low performance, we created a product set with only our top products. All products in our product set feed had a conversion rate of at least six percent.

 

Last, we created a remarketing campaign that segmented users based on intent level to ensure that 98% of people who don’t purchase today will be retargeted to complete their purchase. We created different discounts and offers depending on how “hot” the visitor was. Our goal was to spend at least 25% on remarketing campaigns, and 75% on prospecting traffic. 

 

Fast forward 60 days, not only were we able to reach the ROI of 1.5X, but we achieved an ROI of 2X on $150,000 monthly ad spend! Within 12 months, we were able to triple the spend to $450,000 per month with an ROI of 2.2X! 

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