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How My E-Commerce Business Soared From 0-$100K in Less Than 4 Months

This story was originally published on Oct. 5, 2018, and is brought to you today as part of our Best of ECT News series.

Over the past 10 years, I’ve been a part of at least that many startups. The tools of the trade have changed rapidly, but the core elements of successful entrepreneurship remain relatively unchanged. When I was first starting out, “social media marketing” was a brand new concept and existed almost entirely on Myspace. Now entrepreneurs have a slew of tools to amplify their brand and grow their e-commerce revenue, but it’s easier than ever to get lost in the noise.

As a consultant to numerous brands and a company founder, I can tell you success isn’t easy, but it is attainable. By following the right steps, I was able to grow Startup Drugz from zero to US$100,000 in less than four months with the use of Facebook marketing and automated sales funnels. After six months, I was hitting a $500K run rate. By taking the following steps, you’ll be well on your way to building a thriving e-commerce site.

1. Validate Your Idea

No matter how good your concept is, don’t do anything without a small test run. Don’t run any paid traffic or make any real investment until you’ve validated the idea. Get a minimum viable product to test the waters and see if anyone is actually interested in what you have to offer.

For Startup Drugz, I wanted to know if anyone actually would buy entrepreneur-themed shirts. I mocked up a basic Shopify store (using a free theme), with a few initial T-shirt designs. I integrated with Printful, so every order was printed on demand without me needing to buy any inventory.

Once the store was up and running, I submitted it to Product Hunt, a platform with daily votes on newly launched products. The top three to five hunts get massive free exposure via both the site and the email newsletter featuring the previous day’s top products.

Startup Drugz was one of the top three most upvoted products the day we launched, which drove more than 17,000 unique visitors to the store, generating upwards of $3,000 in sales during our first week in business. That initial success showed me that the concept had massive potential.

I spent the next few weeks adding more products, building a beautiful store, and implementing a scalable traffic strategy. If you don’t find initial success with your test run, adjust your targeting and branding, and make sure you understand what makes your business unique.

2. Build a Unique Brand

Great brands don’t happen by accident. The reason most new e-commerce projects fail, especially ones that drop ship and use print on demand, is that they don’t treat the store as an actual business.

If you were starting a brick-and-mortar business, you would not pick any old piece of cheap real estate, throw random products on the shelves, and buy a bunch of generic ads. You would spend considerable time and money doing extensive market research first. You’d need to craft a beautiful store, develop a unique brand, hire the right people to give customers a great shopping experience, and much more.

This is how you must approach your e-commerce site, or you’re destined to fail before you even begin.

For example, Startup Drugz isn’t just another store selling low-quality drop-shipped shirts. I focused first on building an authentic brand with a genuine mission and purpose that extended beyond merely making money. Consumerism has changed fundamentally in the past few years. Customers are looking for something more than just a good product at the right price. They want to connect with a deeper meaning, and you can give that to them through your company.

This is how you go about creating a tribe of loyal customers who become walking, talking marketing machines. Nothing is more powerful than word-of-mouth advertising. People don’t camp outside Apple stores for days to shell out $1,000 just because they want a new phone. There are plenty of great phones at a fraction of the price, available with little to no wait.

Apple fans do it because they love Apple as a brand, not just as a product. By focusing on building our brand we were able to attract high-profile customers like the Miami Dolphins, SpaceX, and Russell Brunson. Foster and leverage the enthusiasm around your brand, and growth will follow.

3. Set Your Business Apart

One of the biggest mistakes I see business owners make is trying to be like everyone else. They write very generic, bland ads and respond to comments and trolls in a stiff corporate tone. They try their hardest to avoid stirring the pot — but that sends its own message of apathy.

The problem is that if your goal is to be liked by everyone, you’ll be loved by no one. You need to generate genuine enthusiasm for your brand. Being polarizing means that you will elicit strong emotions from most people. Some may hate you, but it also means there is a group of people who will love you.

Think about every presidential candidate in history. There hasn’t been a single president who was universally loved, or even liked, by 100 percent of Americans. Every four years, both presidential candidates have large groups of people who hate them. Despite this fact, at the end of every election, one of those candidates becomes the commander in chief.

Here is a fun activity to see this polarization in action: Try telling your Android-loving friends why the iPhone is superior. Try telling a Pepsi lover why they should switch to Coke. Try telling someone who loves Fox News why MSNBC is better. All of these brands are worth tens of billions of dollars despite being hated by large groups of people.

From day one, I wanted Startup Drugz to have a specific type of voice and identity. Everything from our ad copy to the way we handle trolls is fun and usually full of sarcasm. For example, one particularly notable troll commented on one of our early ads, saying that no serious entrepreneur would wear t-shirts.

Most companies either would ignore that type of comment or provide a canned response. Instead, I responded with a collage of photos featuring the wealthiest and most famous entrepreneurs, from Mark Zuckerberg to Elon Musk, wearing t-shirts!

Another paid-traffic-specific advantage of being polarizing is that your ads will get substantially greater organic reach as debates often start in the comment threads. These threads then get shared by a much higher percentage of people. Not all of us can be as viral as Wendy’s Twitter account, but taking risks with your tone and messaging is critical to gaining traction online these days.

4. Don’t Mistake Investment for Expense

Now comes the hard work of building your brand day after day. Before spending a dime on Facebook ads, it’s crucial to understand that profitable ads take time. Don’t start running Facebook ads if you are only willing to invest a few hundred or a few thousand dollars. Don’t burn through all your capital early on expecting massive results within the first few weeks.

During the first few months running Facebook ads for Startup Drugz, I took some significant losses. However, they’re not true losses if you’re investing in your brand’s future success. I tested everything during this trial period, and I mean everything. I went through hundreds of creatives, copy angles, audiences, objectives, ad types, calls to action and manual bids, among other variables.

A majority of those tests failed outright, some broke even, and a small number were very profitable. If I treated my ad spend like an expense, I most likely would have given up after the first few failures. I never would have found the winners that helped Startup Drugz get to where it is today. Treat ads and your test runs as an investment, not an expense.

During the testing process, you should have four different campaigns running. The first is a website conversion campaign, running ads directly promoting your product.

Second, you’ll need a page post engagement campaign that will quickly add social proof to your new website conversion ads. This is where you run ads in the social feeds of people who have previously engaged with your page.

The third strategy you should implement is a video view campaign, which will drive the views of your website conversion ads and create deep engagement with the use of video.

Lastly, you’ll want a retargeting campaign that will bring back abandoned carts and upsell first-time buyers, among other objectives. Another benefit of investing more substantial amounts early on into driving high-quality traffic to your store is that you create valuable lookalike audiences earlier in the process. Many of our most profitable ads of all time are targeting our various lookalike audiences, specifically from our buyer audience.

5. Understand the Value of Post-Purchase Retargeting

Most e-commerce entrepreneurs focus 100 percent of their paid traffic (and marketing efforts in general) on acquiring new customers. This is a mistake. From day one I have prioritized increasing Customer Lifetime Value (CLTV) and brand loyalty over simply converting more cold traffic.

This strategy has paid off big time as our CLTV is significantly higher than our initial Average Order Value (AOV). Because of this, we can outbid and outspend our competition since we’re willing to break even or even go in the hole to acquire a new customer. We accomplish this profitability by running a specific sequence of retargeting ads aimed at people who have made a purchase with us in the last 30 days.

We start with our simple but incredibly profitable thank you video ad, where I personally thank the new customer for their order. This lets them know I am here to make their experience as amazing as possible.

I then follow up with a video ad to see how they are loving the shirts, and I ask for a photo wearing their favorite one and/or a review.

Last, I run a product catalog sales ad upselling or cross-selling them. These ads are powerful, because the products promoted in the ad are different for everyone, based on what they previously did or did not buy.

By investing in retargeting ads for current customers, we both maximize CLTV and create incredibly loyal customers at the same time. These are the kinds of customers that will tell others about your product, and be loyal for as long as you invest in the relationship.

While it’s never been easier to start an e-commerce site, it’s also never been easier to get lost in the e-commerce crowd. To maximize your chances of success, do as much research as you can before investing a single penny.

You need to continuously tweak and refine your advertising — and above all, take care of your existing customers. Turning a sale into a loyal, repeat customer will do more for your bottom line than almost any other advertising expenditure. What goes around comes around, and if you take care of your fans, they’ll take care of you.

Maxwell Finn

Maxwell Finn is the cofounder of Unicorn Innovations, a customer acquisition-focused venture marketing organization that has worked with brands like Sam's Club and 3M.

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