How We Generated NGN 17,547,863 In Revenue For an e-Commerce Business in 6 months From a 1000% Return-On-Investment Paid Advertising Campaign (During the COVID-19 Period) and What You Can Learn From It
If you’re thinking of starting or scaling your e-commerce business, then keep reading. I’m about to share with you the thought process behind a 1000% Return-on-Investment Paid Ad campaign. We used this campaign to increase the revenue of an e-commerce business during the COVID-19 lockdown using paid advertising. A period when customers were conservative about spending.
To give a little background to this industry…
The e-commerce market size was valued at USD 9.09 trillion in 2019 and expected to grow at a compound annual growth rate (CAGR) of 14.7% from 2020 to 2027.
Reports from 2019 says, e-commerce was responsible for around $3.5 trillion in sales and is expected to hit $4.9 trillion by 2021. In the US alone, e-commerce represents over 10% of retail sales and that number is expected to grow by nearly 15% each year!
Therefore, if you had a 0.000001% market share (which translates to $3.5 million you could still be profitable), and of course the market keeps growing.
Hey! There’s room for everyone if you know how to do it the right way.
And YES, there is a wrong way to do this and it could cost you a ton of money. But… you’ll be able to avoid that after reading this article to the end.
The Story Really Begins…
For the sake of this post and on request by the client to remain anonymous I’ll use Aurora Beauty as a pseudonym.
Sometime in January 2020, Aurora Beauty, an e-commerce beauty store reached out through a mutual friend. Their business needed more visibility that would convert prospects to sales.
And this process took much longer than normal, and here’s why…
From experience, we know most clients who come to us, come after a snake bite. They would have tried a couple of other agencies who promised them the galaxies and milky way only to realize at the end of the day it was just smoke and mirrors.
So most of the time we expect skepticism when clients approach us (but there are exceptions to this rule). I mean no one should jump from one sour relationship to another without some form of due diligence.
They had a similar case.
We had a couple of meetings to understand their needs and define the successful customer outcome. This included defining their target audience, a customer journey mapping and installing KPIs.
Here’s a screenshot from one of our dashboards showing a portion of the sales generated over a 7-month period.
Keep reading to get the full scoop…
Now, I have to buttress the fact that most of the sales came in during the COVID-19 pandemic; in the heat of the lock down…
Which makes it more interesting…right?
Typically during economic downtime (such as the COVID-19 era), consumers basically are in conservative mode. They aren’t willing to spend as a result of the uncertainty, so marketing has to be strategic…
or you could lose a lot of money.
When it comes to digital marketing strategy, talk is cheap but RESULTS speak volumes.
If you’re not tracking user behavior and other key metrics then its “hope-marketing”. That’s more like throwing mud on the wall and hoping it sticks.
You’ve lost the game before you even got started.
The Test Campaign Happened…
We did a couple of test campaigns to figure which channels would get the results they needed.
But to give a little perspective; every campaign we launch is created using the framework below.
This serves as a guide along the way so we know exactly what to tweak to guaranty results.
The 5 Stages Every Campaign Needs To Succeed.
There are basically 5 stages all campaigns go through to guaranty success.
It always begins with awareness about your product or service. This requires a good chunk of narrative on the needs in the marketplace and how what you offer is the solution. A good awareness campaign with a clear understanding of the customer’s needs will always generate traction. Not to talk of the level of goodwill that you can capitalize on. Long story short, the goal of awareness is to get the attention of your prospective customer.
The next best thing after getting the attention of your prospective customer is knowing what they really want before they tell you. It is not as difficult as many think because the customer always leaves clues about what they want. This is where engagement comes in right after an awareness campaign. Engagement is the point where your prospective customer wants more information about your solution and this is where the selling process is initiated by them.
If you’ve done a good job in your market research before launching the awareness campaign everything will become a science which can be reviewed and optimized for maximum result. This is conversion.
For instance, you create a campaign that 500 people see, and 100 people reach out to you and 20 people purchase. You can clearly say that you have a 20% conversion rate. So with a few tweaks you can effect a positive change in your business outcomes.
A lot of business owners rejoice at this moment but this is just the beginning. It allows you to have enough data to analyze and optimize so you can scale your business. A simple way to put it would be; you ran a campaign that brought you 20 customers. The next step is getting them to make repeat purchases. This shouldn’t be as hard as the first time if you give a great customer experience. It’s basically about doing the work of convincing them to buy and then leveraging that initial marketing effort so you can get more from it.
5. Upsell/ Down-sell/ Cross-sell
This should be the ultimate goal for your business on each transaction. Simply because it maximizes the profitability of that business and allows you to create and deploy more dynamic strategies. This establishes market dominance the customer can’t ignore because it is too irresistible.
And this brings us to the thought process we use everytime…
The Message, Market, Media Match.
This defines what segment of the market we are targeting. What many of us know as the target audience.
This identifies what we’re telling them. What information are we putting in front of them that is solving an immediate need?
It basically sheds light on how we intend to reach and engage them. What platforms are they on?
Now, Aurora Beauty’s target market (MARKET) are women. We had to drill down to which of the social channels (MEDIA) will help us connect with them. Also had to determine the right things to say (MESSAGE) to them.
Google is the biggest and most powerful search platform with about 3.5 billion searches made globally. What makes it big is the ability to get at customers right when they are looking for answers.
Think of it this way. When a customer has a question in mind with respect to a challenge they might be experiencing they make a search online. Your job is to position your business as the solution by providing an answer and that gives you an edge.
Next is Facebook. The biggest social platform with over 2.45 billion users and it owns Instagram and WhatsApp.
The campaign led with an awareness campaign on Google. This decision was made due to the fact that our ideal customers make searches based on their needs on Google. We then backed it up with Facebook campaigns geared at driving conversions – making the sale.
Based on data gathered we settled for Google and Facebook(and Instagram).
It worked brilliantly well.
As you can see, we had an ad spend of $782 (about NGN 359, 720), on Google and generated over 3,000,000 impressions. This means our ad was seen by our audience over 3million times and we got over 29,200 clicks to the website. This happened over a 6-month period.
Also for Facebook,
We had an ad spend of $2,976.63 (about NGN 1,369,249.8) and reached 1,101,824 people. We had 3,860,422 impressions which generated 39,888 clicks that brought in 686 sales, amounting to $38,147.53(about NGN 17, 547,863.8). All these happened over a 7-month period.
At the end of the day, we have a total ad spend on Google and Facebook at $ 3,758.63 ( at about NGN 1,728,969.8)and that brought in a revenue of $38,147.53 (NGN 17,547,863.8) which is a 1000% Return on Investment.
Here’s a table that makes it clearer:
At the end of the campaign, the only thing that matters the most is your Return-on-Investment. For any business owner, every dollar invested in marketing should be held accountable to the results expected.
Here’s the analysis we did for the Google campaign based on the desired expectation…
Also did the same for Facebook..
- 0.01% ad impressions ad on Facebook or Google clicked on it to visit the website
- 0.019% of website visits converted to sales.
- Average Order Value was at NGN 19,250.67
- Customer Acquisition cost was at an average of $4.28 (NGN 1,967.31)
- Return on Ad Spend was 1000%.
- For every $1 invested in paid ads, we made $10.14
Here are key takeaways:
1. Know Your Audience
Results may vary from industry to industry as well as the buying pattern of the customers. Therefore, the need to understand the market you’re engaging cannot be over emphasized. A deep research based on the search queries could be a good starting point. So an advise would be to leverage tools like Google keyword tool to help uncover the buyer’s intent and leverage on it.
2. Track Everything
Marketing without some form of tracking is basically like water in a bucket with lots of holes. Keeping a tab on all metrics allows you to find your winning formula. Once found, repeat it continuously until it becomes perfect. Accountability in marketing is what makes digital marketing superior to all forms of marketing a business can deploy.
3. Know Your Numbers
The most effective way to scale is to know your business numbers. The numbers uncover insights and brings to surface untapped opportunities that any business can use to get immediate results. This is what defines the success framework that drives business growth across the board.
Here’s my offer to you…
Now, while results may differ in your market we have broken down each step into a science. We are confident we can achieve the similar results in your business.
There’s no point going slow, if you can go faster and we can show you how to do it.
So, click on the link here and fill out the form. Let’s talk about scaling your business.