The Ecommerce Uptick

How my CRO agency took a Pet brand from 167K a month to 800k a month

The brand was:

- Selling mainly in the UK

- Mostly focused on 1 hero product

- Had many UX issues / low conversion rate

- Struggling to get over 200k a month

So we got to work and started with a big audit process.

This is where we get access to their Analytics, shop backend so for forth.

We analyzed their user behavior in our audit process.

GA revealed:

A huge ratio of visitors bounced from the home + category pages.

Session records revealed:

users did not see all products available on category pages

product page was confusing and caused paralysis

UX was slowing down the customer journey.

We also did survey work and found:

Customers were not aware of the return policy

users was not made aware of the main benefits

Based on this we launched a series of A/B tests to fix the issues.

The results after 90 days

$600k additional revenue per month

51% higher conversion rate

14% higher AOV

ROI on our cost as of August: 39.6x

That will keep going up!

They’ll expand into new markets

they will launch new products.

Stories like this really motivate me. I guess this is why i started Purplefire

Never stop believing!

Wake up call for DTC Ecom brands!

Even though you are trending on social media.

The hottest VC is funding you...

You can brag about a 6x+ ROAS

And the best influencer creatives...

You will still fail without

- Knowing your Life time customer value

- Your unit economics (Gross Margin 1, Gross Margin 2 etc)

- Your Cashflow budget

So why is LTV important?

Well how do you know what you can pay to aquire a customer if you don't know what they will generate over their lifetime and each year?

Media buying is a game with dimishing returns and 1 winner (The house aka, Meta, Google):

You may get a 10x ROAS if you spend $1000 a month, but a 7x if you spend 10k. This is simplified of course, but the more people you reach, the colder the audience gets. Eventually you will end up paying more to outbid others...

You have to understand your LTV in order to understand what your CPA goals should be.

And that is just the tip of the iceberg.. because you still need more data...

Most brands don't do accounting well. Heck if i say GM1, GM2, most ecom brands have no clue what I am talking about...

You need to understand your gross margins...

GM1 is total revenue minus cost of goods. ie how much it cost for you to produce those products

The formula for calculating is GM1 = (Total Revenue - COGS) / Total Revenue

Why is it important?

GM1 provides a fundamental measure of the profitability of a company's core operations without factoring in other indirect costs like operating expenses, marketing, or administrative costs.

Yet.. we need to get deeper.. we need to understand GM2

Gross Margin 2 (GM2):

Here is where it gets interesting.

Adding in shipping costs, CC fees, Fulfillment fees(software, packaging etc.)

The formula for calculating it = (Total Revenue - (COGS + Variable Operating Costs)) / Total Revenue

So lets say you sell for $100

your GM1 is 60% (40% is eaten up by cost of goods sold)

Your GM2 is 40% (packaging, shipping cost etc.)

Now you are left with $40 before accounting for marketing and your operational expenses.

Now if your CPA is $45, you may have a problem.. You are not breaking even...

but what if your LTV is $190 after 4 months?

Perhaps this is not so bad after all.. This is why the economics are so important.

What is the cost of getting that additional $90 over 4 months

So few brands have these numbers...

Last but not least... Cashflow..

equipped with all these numbers and sales targets for each month, you can actually calculate your cashflow. Obviously you need to factor in when you have to pay wages, ads, inventory.

Without this, you are working in the blind and may go in the negative some months... Heck you could go bankrupt because of it..

The less you know about your numbers, the less aggressive you can be in scaling up your ecom brand...

If you us to help you in this area, reach out to me on [email protected]

Offer free shipping for orders over a certain amount, which can incentivize customers to add more items to their cart to reach the threshold.

Example: "Get free shipping on orders over $50!"

Bundle products together at a discounted rate, which encourages customers to purchase multiple products at once.

Example: "Buy a shampoo and conditioner bundle for 15% off!"

Use product recommendations to suggest complementary products to customers that they might be interested in adding to their cart.

Example: "Customers who bought this dress also bought these shoes."

Offer more expensive or higher-end versions of products as alternatives to what customers have already added to their cart.

Example: "Upgrade to our premium model for just $50 more."

Offer related products that customers might also be interested in.

Example: "Customers who bought this book also bought these bookmarks."

Offer discounts or freebies for orders placed within a specific timeframe.

Example: "15% off all orders placed in the next 24 hours!"

Offer incentives for repeat customers, such as discounts on future orders or exclusive access to certain products.

Example: "Join our loyalty program and get 10% off your next purchase!"

Offer a free gift with a minimum purchase, which can motivate customers to spend more to receive the gift.

Example: "Spend $100 and get a free tote bag!"

Offer discounts for larger quantities of items purchased, which can encourage customers to stock up.

Example: "Buy 3 or more and get 20% off each item!"

Offer a free item with the purchase of another item, which can incentivize customers to add more items to their cart.

Example: "Buy one shirt, get one 50% off!"

Use data to personalize recommendations for each customer, such as showing them products that other customers with similar purchase histories have bought.

Example: "Based on your purchase history, we think you'll love these products."

Send emails to customers who have left items in their cart, offering a discount or other incentive to complete the purchase.

Example: "Come back and get 10% off the items left in your cart!"

Use exit popups to offer customers a discount code or other incentive to complete their purchase before leaving the website.

Example: "Wait! Don't leave without getting 15% off your purchase!"

Offer limited edition or exclusive products that customers can only purchase for a limited time.

Example: "Get our limited edition holiday gift set before it's gone!"

Include product reviews on your website to help customers make informed purchasing decisions, which can lead to them adding more items to their cart.

Example: "See what other customers are saying about this product."

Offer exclusive benefits to VIP customers, such as early access to sales or free shipping on all orders. This can encourage customers to spend more and become loyal to your brand.

Example: "Join our VIP program and get free shipping on all orders!"

Offer gift cards as an option for customers to purchase, which can lead to them spending more money than the value of the gift card.

Example: "Give the gift of shopping with a $50 gift card!"

Offer financing options, such as installment payments, which can make larger purchases more affordable and encourage customers to spend more.

Example: "Buy now, pay later with our installment payment options."

Offer to donate a portion of sales to a charitable cause, which can incentivize customers to purchase more.

Example: "10% of all sales this month will be donated to our partner charity!"

This is not as easy as it sounds. You need to look at your historic data if you have it.

Look at what worked and what didn't.

How much inventory did you have?

what promotions did you run?

How much did you spend on advertising?

From there make your new targets. Make them realistic and brief your team on them:

2. Plan your inventory.

You have your sales targets so you can now plan how many units you need to have in stock for Q4.

Make sure to get delivery well ahead of time. There will be many delays due to how busy the season is.

Make sure to have inventory for december as well! i see so many brands running out too early.

3. Plan your media buying activities.

If you work with ad agencies, now is the time to get them up to speed.

what is your ad budget per channel for each month?

Do you want to capture emails for an early bird promotion?

Who will create new ads and creatives for your campaigns?

Make sure you have everything ready to go.. Agencies are busy too and they can't do everything a week before.

4. Setup your email campaigns early.

all the campaign emails can be done way ahead of time!

consider launching winback ads for the customers who have not bought in a while. Now is the perfect time for them to shop.

Consider A/B testing titles, offers, content for 10% of your list, then send the last emails to the winner of the test.

5. Create irresistible offers

We have all heard this by now. "100M offers" by Hormozi goes into why you need to create a no-brainer offer for your clients. In ecommerce you need to present the offer through the customer journey. You can do this in your ads, email campaigns, popups, on the PDP/LP pages and the list goes on.

Things that work well according to our data:

Good Return policy +45 days (no questions asked)

Test period for clients to try the product

XX result or money back

bonuses / gifts

Discount for a very limited time

Limited stock

and the list goes on...

6. Improve your AOV

We all know CPAs go through the roof in Q4, so if you can increase your AOV, you can afford to pay extra for clients.

Here are ways you can improve it:

Implement a discount ladder in your cart showing different thresholds for free gifts, discounts and bonuses..

add pairings and bundles on your PDP page.

Add upsells on the cart + checkout page.

Add a "shipping protection" upsell for $4-5 in the cart

Add a post-purchase up sell for more of what they in their cart

7. Improve your conversion rate

The same as before but you want to do your testing before the high season. This is important so your marketing budgett is as efficient as possible. You can setup your own tests via tools like convert.com or via AB Convert on Shopify.

8. Test your free shipping threshold.

This is one of the best ways to improve conversion rate but also AOV.

You can use a variety of apps for this on Shopify.

You can also A/B test adding a $5-$10 extra charge by upgrading them to express shipping.

Most people will love getting asked to pay instead of having it forced upon them.

Are you familiar with the "Attentional bias" principle?

We tested this for our ecommerce clients recently...

The results surprised us and here is how you can implement it:

So first of all - Attentional Bias is a cognitive bias that influences people's tendency to focus more on certain stimuli or information due to personal interests, emotions, or preferences.

Think about it... if you are a meat lover, you are more likely to notice a big sign from the butcher saying "Ribeyes are 30% off just today"

Here is 3 ideas we recently tested for our ecom clients with great success:

Addressing the top motivations & hesitations: Scrape customer reviews and ask GPT to analyze the sentiment in each review and then give us the top 3 motivations for buying the product & the 3 biggest hesitations/dislikes.

Test: We redesigned the PDP page based on this information and displayed the info above the fold and around the Add to cart button.

Why it works: Because people are more likely to pay attention to things they actually find important.

Emotional Storytelling: Craft compelling stories that evoke emotions related to your products or brand values.

Test: we added a founder's story that explains the "why" of the brand and the person behind it.

we highlighted it above the fold and via an interactive FAQ via @gotolstoy

why it works: Attentional Bias leads people to focus on emotionally resonant content, making them more likely to connect with your brand and convert. in the above case we envoked empathy which leads to connection and ultimately trust and higher likelihood of conversion.

interactive Elements: Setup A quiz to make the final product selection personalized and engage users and hold their attention.

Test. use yes/no questions and rate yourself from 1-10. These questions are easy to answer and require less effort to answer on mobile. Ultimately the products the user ends up with, should feel personalized because of their answers.

why it works: people are more likely to buy if they feel that the products are tailored to their needs. They want to feel special and heard at the end of the day.

Oh and if this was useful in any way for you, please let me know below.

Heard of the Framing Effect? - If not. You should pay attention

We use it all the time to boost conversion rate for ecom brands

Let me give you my favorite 5 ways to test it out yourself 👇🏻

First of all - what is it? The framing effect is a cognitive bias that explains why people's decisions can be influenced by how information is presented to them.

Let me give you an example:

This meat is 20% pure fat.

This meat is 80% lean.

Which one are you more inclined to pick?

The answer is 80% lean for most people because it sounds healthier.

Companies use the "framing effect" all the time but here is how we use it for ecom:

1.Price Anchoring: Present higher-priced options first to set a reference point or anchor. When customers see the higher price first, subsequent prices appear more reasonable in comparison. For example, if you offer three pricing tiers for a product, start with the highest tier to frame the other two as better deals.

Testing - We have done a lot of price testing on price anchoring. Our favorite test is highlighting how much cheaper each unit is im comparison to buying just 1. You could also play with things like "cost per day" or "cost per month" to highlight the bulk savings of buying more now.

2. Decoy Effect: Introduce a "decoy" product that's strategically positioned to make another product seem like a better deal. By offering a slightly less appealing option, you can guide customers toward the one you want to promote. This is often used in tiered pricing strategies.

Testing - If you are running landing pages, try to make the "decoy" really unattractive. Less discounts, no bonuses or extras.. Thus making the most expensive really attractive.

3. Positive Frame for Shipping Costs: Instead of presenting shipping costs as an additional expense, frame it as a small fee for premium service. For instance, "Upgrade to Express Shipping for Only $4.99" sounds more appealing than "Shipping Costs: $4.99."

Testing - testing free shipping above X amount, and then ask people to upgrade to premium if they want it faster. Most people will say yes if you present the offer.

4. Limited-Time Offers: Frame discounts or promotions as time-limited opportunities to create a sense of urgency. For example, "50% off for the next 24 hours only" triggers a fear of missing out (FOMO) and can prompt quicker purchasing decisions.

Testing - Try running sales for 24 hours with countdowns. You could also do a countdown for the amount of stock you want to sell at a specific discounted price.

5. Bundling and Unbundling: Presenting a product as part of a bundle with other related items can make it seem like a better deal than purchasing each item individually. Conversely, you can unbundle products to make them appear more affordable on their own.

Testing: - Reverse bundling testing is very overlooked. We have tested selling the product as a bundle but then highlighting that you can also buy it individually for a discounted price. This has been a great test a with big conversion rate boost.

Simply by focusing on removing and decluttering information on PDP & Landing pages..

Read below how we did this in a few easy steps.

We came up with this test from going over session recordings inside of @hotjar, and this revealed that visitors were skimming and not taking the time to read the USPs of the product.

Post purchase surveys revealed that clients almost never mentioned the USPs or features displayed on PDP pages.

And for that reason our test Hypothesis became:

Improve buyer motivation by addressing the main product benefits using less copy and better constrast.

Ultimately making easier to read, skim and understand the product in a few seconds.

Goal of the test: Improved CVR.

Results:

CVR +92.73%

ATC +107.41%

Now i ask you - do you have TOO MUCH information on your product page or Landing page?

Often less is more...

Consider testing removing areas, adding more empty space around important elements.

If you take away 1 thing from this - Make your pages skimmable...

The average. session on your site will bounce in seconds if you present anything complicated to them.

remember that an overload of copy spikes cortisol because we feel the need to read and understand everything before making a decision...

Users will want to go back to their dopamine fix which is hitting the "back button" and going back to scrolling social media...

There are 4 main reasons why most Ecom brands CANNOT scale further...

Issues we tackle and help our clients overcome daily

Reason #1: Your ad setup sucks.

Your ad structure is too complicated.

You tend to have:

• Too many campaigns

• Too restrictive targeting

• No stability in your ad performance

Solution:

Let the algo work.

• Broader targeting

• Fewer campaigns

• More sales within a single campaign

Stop worrying about attribution and focus more on your overall marketing percentage or blended ROAS.

Reason #2 You are NOT priming your customers before they hit your website

Your ads are simply not based on your customer data.

After the first 3 sec hook, you need to address the most important problems that your product fixes.

Solution:

Make sure your creatives address the main motivations, problems, and hesitations based on the data you have gotten from surveying your customers.

Reason #3 Your site is simply not converting well enough which leads to very high CPAs

Social & Search traffic is probably your main source and you have 3 seconds to hook them in.

If you manage to do that you got 5-15 sec to convince buyers that you have a product worth spending their money on.

Solution:

Stop sending traffic to PDP pages, and focus on Landing Pages that hook, catch, and convert customers.

Reason #4 Your Customers are not raving Fans - word of mouth is not a real thing in your business.

Just like a virus, your business can't grow if your brand isn't contagious enough - or worth talking about.

If your NPS (Net Promoter score) measuring how likely a customer is to tell somebody about your business is lower than 7, then it is impossible for your brand to grow and profit with the raising ad costs and other costs while running the business at scale.

Solution:

Start surveying people post-purchase on NPS and get a picture of where you are now - make sure to keep doing this in your post-purchase email flow and see the trend develop over time.

You can fix it by improving the perceived value of your product such as quality, additional features, durability, design etc.

But often the biggest improvements come from improving your relationships with your customers.

Consider introducing an ambassador program, loyalty club, online & RL events.

Small things work too:

Personal note in every order, phone call, or email to ensure customers are happy...

People don't want to feel like a number, they want to feel like you care...

There is one guaranteed way all 8-figure ecom brands scale their brand.

That 5, 6 & 7-figure Ecom brands usually don’t.

A method that stacks wins on top of wins and allow you to spend $100.000s on ads per month.

They subscribe to the principle of "CAYD"

"Constantly Audit Your Data"

Now you might be thinking... Oh we do that already.

but I'm guessing...

You don't do it consistently in all the areas required.

You don't have a dedicated resource for monitoring

You are not implementing A/B tests based on your observations

Even if you do all 3 things, are you happy with results or is there more on the table?

Here are 8 things you should constantly be doing:

Setup custom reports in GA4 to monitor conversions at every stage of your customer journey + setup automated reports when big drops occur.

Integrate a session record software like Hotjar to your site and watch recordings such as: Visits that Abandon carts, visits that bounces, visits that bounces after hitting PDP, visits from specific paid sources, visits on the home page... the list goes on...

Survey visitors on your top 5 selling products to ask why they are not buying.

Survey customers from previous month to ask what they liked about the product and what could be better.

Review mine your competition + yourself and use AI to generate sentiment reports on what people dislike and like about the product.

Pay for users to go through areas of concern on your site using services like usabilityhub

conduct ongoing competitor analysis to see what is working for them via ads, landing pages etc.

Launch A/B tests based on all the above to verify your hypotheses and constantly get wins stacked on top of wins (kill loosers)

8 figure brands don't use their gut when implementing new designs.

They trust data and they use it to their advantage.

If you want to work directly with me and my team, then just contact me at purplefire.io or at [email protected]

You can't build a business if you don't master this.

The road is full of obstacles but we can learn to enjoy it

To be honest with you - I have never been great at this.

I have been a "comfort zone seeker" most of my life.

But finally i learned to embrace the unknown. Even if uncomfortable at first, I know that i will end up regretting not trying a new path.

I find it useful to pause whenever i need to make a decision and ask myself " Am I saying no to this because it is uncomfortable?"

Often i find the answer is yes, and thats when I know i need to embrace it and just see what happens.

Tell me if you have ever felt something similar? How did you overcome it?