ERGO STUDY CASE

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Who said eCommerce is only for B2C sales? ??

Ergo Styling Tools sells top-quality perfectly ergonomic hair styling tools loved by professional stylists and end customers alike. ???♀?

In 2020, they made opening up their online DTC channel as one of their key priorities. They wanted to skip the middlemen and keep the profits by selling directly, while increasing their brand awareness and boosting their premium professional tools provider among stylists through online advertising. ??

Before I dive into our strategies and tactics, here’s what you need to know about this market.

In a market like this there’s not one, but TWO self-reinforcing flywheels we leveraged to grow this brand:

① Flywheel nb 1 (stylists):

You sell to stylists who hang out with other stylists a lot. If they love your product they’ll recommend to other stylists

The more stylists recommend your product, the more likely other stylists will adopt the tools

② Flywheel nb 2 (end customers):

End customers see the tools at their stylists and think “if my stylist uses it, it must be good” so they buy the product and recommend to their friends

If end customers know the brand of the tools, they’ll consider stylists using them as more professional, so stylists must adopt the tools to stay relevant.

When we figured out these 2 mechanisms it became clear that mixing b2b and b2c advertising will be the key to unlocking rapid growth. Over time we figured a sweet spot of about 75:25 split between b2b and b2c budgets resulted in the best profitability.

Here’s the principles of the strategy we used.

?? B2B Value Proposition & User Experience: To increase the value proposition for B2B customers and prevent B2C customers from using b2b discounts, Ergo team set up a PRO account registration flow that B2b customers needed to use to qualify for bulk discounts.

We set up an analytics framework and a spreadsheet to measure direct-to-consumer vs B2B sales, so we could keep track of our objective of breaking away from B2B-only. Also, to prevent B2C customers from using B2B discounts, Ergo team created a PRO account registration flow that B2B customers needed to use to qualify for bulk discounts.

We helped the Ergo team establish accurate profit tracking so they can be confident in the bottom line campaign profitability on both b2b & b2c before scaling more aggressively.

??Local conversation domination, then scale: It’s hard to build a brand on a limited budget if you’re trying to do it in the whole of the US at the same time. Instead, we focused on key states where Ergo already had presence and started to advertise in those states. We also put part of the budget to some new states to start building more brand recognition there.

?? Customer Lifetime Value boost via Facebook and Email: We activated Ergo’s existing audience on Facebook by running extensive retargeting campaigns with different catalog segments to increase conversion rate and Customer Lifetime Value. We built their email automation sequences for both b2b and b2c customers and started running content and promotional campaigns. We now consistently get over 30% of revenue from email.

??Affiliate program to increase word-of-mouth: To further facilitate the partnership with stylists, we launched an affiliate program where stylists could earn prizes, discounts and earn status badges for referring friends and customers to Ergo. (We wanted to avoid cash payouts, as that would trigger tax obligations for the client). We used Refersion and Upviral to run contests and affiliate campaigns.

?? Creative Strategy: We established a creative strategy coherent with Ergo’s established brand image.

We wanted to position Ergo as a partner for stylists in supporting their customers. What stylists want is tools to look legitimate and grow their business so in our advertising creatives, we focused on a high-quality premium feel of the tools and the recognition of our tools among both stylists and end customers that automatically upgrades the status of every stylist. We also showcased products in professional use, as well as testimonials of both stylists and customers using the products.

??Facebook ads Strategy: We leveraged Facebook Power 5. We used simple account structure, few campaigns: creative testing campaign, audience testing campaign and ABO campaigns for scaling TOF, while we used CBO for BOF. We used ABO for MOF too as we found that our social audiences were a bit volatile and we needed more control. We used a combination of Image & Video creatives as well as carousels and Dynamic Product Ads on TOF. Same breakdown on BOF. We separated story placement from other placements to personalise creatives for stories.

?? Adding Google Ads to the channel Mix: When running both Fb and Google, both channels tend to get better results. Facebook traffic comes back via brand search and Google cold traffic gets retargeted on Facebook.

After cleaning up some of the low-hanging fruit in the Google Ads account, our first major initiative was to rebuild the branded search campaign. We then created a new set of copy for each ad group maximizing ad relevance and quality.

We also configured their Google Merchant account and created a regular shopping campaign using manual bidding to kick start the shopping campaign and get first conversions. After we hit the level of getting 50-100 conversions per month the plan is to switch this campaign over to Smart Shopping one using automated bidding strategies and AI to scale it further.

Lastly, we have created all relevant retargeting audiences (website visitors, cart abandoners) within specific time frames and created display retargeting campaigns.

After tackling a few quick wins we were able to instantly move the needle on all key metrics. Within the first weeks, we had completely rebuilt their Google Ads account and that’s when performance really started to take off getting ROAS of 10+ and 5 figure revenue consistently.

The results?

? eCommerce Revenue increased +308%

? Global ROAS (total revenue/total spend) 13x+

? Revenue achieved: $120k+ monthly and growing

Ergo is now, getting ready for an extensive expansion and scaling.