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The Ultimate Guide to BFCM for Shopify DTC Brands: Inventory, Merchandising, Financial Modeling, Gift Guides & Setting Up for Success in 2025
November 11, 2024
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Simple Kneads Gluten Free Bread brings freshly baked and delicious sourdough bread to your doorstep. All products are free from top 9 allergens and made with only the highest quality ingredients in the USA.
We work with Simple Kneads in a Growth Marketing capacity which includes paid acquisition (socials and search), email/SMS, creative strategy, and financial modeling and forecasting. Since we started working together, Simple Kneads has scaled daily ad spend by over 10x, while increasing ROAS, profitability, and consistency.
Heading into Q4 2023, our goal was to maximize growth while maintaining profitability requirements and overall efficiency.
DTC Storewide Revenues Results:
Simple Kneads had previously experienced volatile variations in both ad spend levels and performance due to seasonal trends and a lack of creative and messaging tests. Their core issue was scaling with consistency. We implemented a thorough testing and scaling strategy via paid advertising channels to increase volume and consistency significantly, while increasing profitability on new customer acquisition.
In Q4 specifically, we grew 50% Year over Year (YoY) by leveraging proven ad types, offers and account structures. We had tested these earlier in the year, then specifically split-tested attribution methods in late Q3, discovering that 7-day-click attribution was far more effective at converting and optimizing for new customer acquisition and new customer revenues. Simple Kneads experienced some of their highest repeat customer sales to date in late Q4 of 2023 due to cohorts of customers from this successful period of new-customer acquisition coming back and purchasing via retention marketing channels (email/SMS).
The results:
Below is a summary of the high-level strategy and approach we deployed on the paid ads side.
We drove consistent growth in their email and SMS marketing efforts throughout 2023, with an average 23% increase in attributed revenue through emails quarterly. The success was primarily attributed to the focused approach to developing and improving the core flow structure and implementing a thorough campaign strategy.
Heading into Q4 of 2023, we placed a large emphasis on ensuring our core flows were as optimized as possible for the large volume of new customers and net new subscribers we would be driving through them. We needed to ensure they were effective at driving new customer revenue to support paid acquisition efforts and make marketing dollars more efficient, as well as driving high volumes of return customer revenue to drive the required levels of profit we needed to see.
One of the key reasons behind the increase in performance of email flows was the strategic implementation of automated messaging at various touchpoints throughout the buyers' journey. This allowed us to engage their customers effectively at every stage, from initial awareness to post-purchase nurturing. Additionally, the automations/flows focused on segmenting subscribers based on their Lifetime Value (LTV), ensuring they received relevant and personalized content. Furthermore, close attention was paid to the frequency of emails, preventing list fatigue, reducing churn, and enhancing email deliverability while maximizing revenue.
The SMS marketing front also had impressive results. We followed a similar strategy by setting up SMS flows that resulted in a 147.45% increase in attributed revenue compared to the previous year. The campaigns alone posted 213.56% growth in attributed revenue, showcasing the potential of SMS marketing when executed effectively for their brand.
Given that Simple Kneads sells consumable products, scaling sustainably and profitably requires growth planning around LTV and retention. To do this, we used historical cohort data to build a model estimating aggregate return customer value by month over time. Following this, we used historical new customer acquisition metrics and referenced recent data to estimate the number of new customers we would acquire. We then used this information to build an ad spend plan around net margin targets. This allowed us to plot a plan for maximum growth while maintaining margin requirements and execute against it.
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