STARTUP → GROWTH

$11k Day Yesterday ($1m a Month Mission)

A 200% improvement on the previous day, what changed?

First, let’s breakdown how I approach scaling an eCOM store…

Step 1 is understanding the competition. In depth!

(INSERT HATER COMMENT HERE)
“You would say that, you own a competitive research software.”

Yes, I do own a competitive research data company. WHY?
Because this is the most important step in the entire process!

And also the #1 most overlooked step in building an eight-figure business.

I had a client who always used to say…
“Everyone wears t-shirts, so why haven’t we sold 333 million shirts in the US yet? Everyone in the USA wears shirts?”

Every time that was said on a call, I could not roll my eyes any further back.

Or how about this comment too…
“We don’t have competition, we are trailblazers who are completely unique.”

Again… 🙄

This is how I do research, and you need to follow along for your brand.

Q: WHAT ARE WE SELLING?
Q: WHO ARE OUR CUSTOMERS BUYING FROM NOW?
Q: WHAT DO OUR COMPETITORS DO WELL?
Q: WHAT ARE OUR COMPETITORS DOING POORLY?
Q: WHERE CAN WE BREAK INTO THE MARKET?

^ These are the 5 questions I always ask.
The answers to these questions start to form an assumption.
That assumption answers this question below:

If we are able to become #2 in the (NICHE) market, then our annual revenue should look like $XXX million per year.

Why do I say NICHE market? Because we aren’t going to be #1 overall.

Ok, let’s break down the company here as an example.

We are selling refurbished electronics on a new brand site.
So yeah, we are not going to overtake Apple or Samsung.
But we could be the #1 refurbished 3rd party company.

So that takes care of WHAT we are selling.

Now let’s cover WHO:
People who don’t want to pay retail.
A quick Google search can give statistics on how many people buy refurbished devices per year. Massive market.

Now it is onto competitors:
Using StoreFilter.com, I find all our competitor stores.
Break down how much money they make per week / month.
Where they get their traffic from.
What emails they are sending.
What products they are selling.
Everything about every store.

I find that one of these stores is valued at $5.7b. Mostly from paid ads.
And one does $2m a month, mostly all organic!

Ok… so let’s compare our product pricing verses the competitors.
We can actually beat them on price.

Assumption 1:
If we can get on Google Ads side by side our competitors’ pricing, we can win first time customers based upon price.

NOTE:
One of the hardest things to overcome is TRUST with first time customers.
People purchase from those they LIKE and TRUST.

So we need to get active on social media to convey trust.
Then we need to build on that trust as we ramp up our customers.

Also important…
If you don’t have a really good feeling about your business model after doing all your research, then perhaps it isn’t the right product / market / time.

Also important…
You don’t always have to win on price, but in this world, Amazon has crazy fast shipping and we need to match them, then win on price because people trust Amazon, and to scale a customer base, it is important to do so on your own platform, not on the Amazon platform.

Also important…
Amazon is looking for ways to put it’s sellers out of business and they do that by looking at your data and then Amazon will become a competitor to you. So this is why it is so much more valuable to build your own platform, starting on Shopify and then later moving to your own custom coded platform that you own everything. (We will probably make that switch at $100m in sales or so)

I know that is a lot for STEP 1! But this is what it takes to win!

Sure… sometimes the blind squirrel can find a nut.
But you don’t always want to be feeling around in the dark.

Approach your ventures with data and precision.
That’s why I launch eight-figure brands over and over!

Ok… step 2!

Step 2 is finding your lead product.

We have over 3,000 different skus on our site now.
And I needed to locate which would be our leading product.

Using StoreFilter, I was able to narrow down what our competitor top selling products are. But I needed to find what OUR BESTSELLER would be.

That data cost me roughly $2500 in advertising spend to find our winner.
FOUND IT! Now what?

Optimize the ads around that product, highlight that product throughout the site, understand who buys that product, why they are interested in our product and how I can ramp up interest on that product through content marketing.

Then we ensure that we have a steady source of inventory for that product. And we start our plan to ramp up.

If you are running a company that is doing $10m a year.
As much as $2m a year could make up the total sales from just 1 product or collection.

Seriously… Don’t fight this!

I have seen so many business owners get emotionally attached to a product and no matter what they do… it won’t be their lead product selling.

What is a lead product?
The product that someone will buy without really needing to get to know you intimately. Like… you don’t need to spend hours and weeks convincing them!

This product they buy on their FIRST VISIT to your store and they are IN!

This product you want to have really good margins, and have your first time customers acquired without going negative. PROFITABLE UPFRONT.

If your brand can be profitable on the FIRST SALE of acquiring a new customer.
And you have several other products down the road they will be interested in…
You are sitting on something that is pure gold. Move now on it!

So getting back to our massive growth…
I found our lead product!

And not only that, I found a collection of products that let us win new business.

My first assumption with this brand was that iPhones would be our driver of new first time customers.

Assumption was proven wrong on launch.
Not to say that one day this could overtake our current lead product.
But as of right now… iPhones are not getting the sales.

Another point is that iPhones have a much bigger search volume for impressions. So you could assume upfront that iPhone will sell more than anything else because more people are searching to buy iPhones.

I made this assumption! But we found a product that converts at a higher rate. 300% higher rate on first visit in fact! So our PPC ads are 3x more effective for the same cost!

Why is this?

Perhaps that is because phone companies are doing a great job at marketing and offering phones “for free”

And we cannot compete with “free”.

Also, people get emotionally attached to their device. And perhaps refurbished is like taking someone else’s girl out on a date. When you open an iPhone from the box, it feels fresh and you get emotionally connected.

Other devices don’t have that connection. People are weird.

So yeah… more things to take into consideration in your first time customer scaling campaigns from paid ads. So many factors to consider!

Step 3 is where can we acquire customers for the lowest cost.

Here is where optimization comes in, so don’t be afraid to have high first time customer acquisition costs as you are ramping up. Build your data then optimize down.

But honestly… most stores never get to this point.

So when I see a decent conversion rate, I double ads spend.
Then if it holds or improves, I double again.
Then optimize and double again.

In Google ads, we are running Performance Max campaigns with our products fed into Google through Google Merchant Center and the Shopify app with all our products nicely optimized with the product feed.

Then we set the Performance Max campaign to Maximize for Conversions, so once we double campaigns again, then we will next optimize for Target ROAS.

Again… most stores never get here!

And at this point we will be spending $5,000+ a day on that single campaign once we start ramping up.

That one campaign should eventually drive us 5x to 8x return on a single campaign. That will be our top scale campaign, then we can test other creatives and product segments in other campaigns.

Again… the goal here is to spend as much as physically possible while staying profitable. And this is just for first time business!

Step 4 is that we need to strengthen our return customer rate.

Here is where content marketing on social media, SMS, email, promotions and giveaways can continue to keep our business top of mind. This is where you scale your profits. Not on the upfront ads to acquire customers.

So make sure your business has a backend plan to build customer loyalty and drive up lifetime value.

Fortunately in the electronics space, once you form a relationship with your customers, they buy new products OVER AND OVER AND OVER.

This is where we can win!

Balancing great value, great customer service, and not breaking the bank.

This is why I love this business!

After reading this… do you have ideas now on how to approach your business?

At the end of the day, if you don’t love what you are doing… you won’t do it right. And you can never expect to hire someone to love your business more than you do. So you must be the driver of vision, direction and goals.

We keep this growth up and there is still time to do $100k in month 1!
And we might do $1m in month 2 at this rate. Hopefully we have enough inventory to make this happen!

Let’s get after it!