Simplified Ecommerce DTC Framework for Profitable Growth

– The framework suggests selecting a hero product and offering it at a reduced price through paid acquisition channels only, while hiding the URL from search or requiring a signup form to access the link.
– It emphasizes the importance of collecting data during signup and connecting it to revenue, orders, and conversion rate to baseline the conversion funnel.
– The framework also highlights the significance of using data for repeat and return purchases to understand buying periods and offer relevant discounts and bundle suggestions.Collect data during signup and use it to analyze conversion rates and optimize your acquisition strategy to find more customers who regularly convert multiple times.E-commerce DTC Framework Simplified

1. Pick your hero product and offer a reduced price through paid acquisition channels only. Hide the URL from search or gate the offer by requiring a signup form with data collection to access the link. Cap this at one item per purchase per person, for the first purchase only.

2. Put them in a separate welcome flow. If they leave the page or don’t add something to the cart, they won’t be able to access the offer. Some will buy at full price, some won’t. On email number 3, which should be about 15 hours after the first email, give them the link to the offer again. If they don’t sign up, you can double tap them later with a smaller offer.

3. Collect data during signup connected to revenue, orders, and conversion rate. Baseline the conversion funnel, also known as subscription to conversion rate.

4. You should average around a 15% opt-in rate and at least a 20% subscription to conversion rate. This means for every 100 people that click on your ad, you should see 3-4 purchases (3-4% conversion rate from cold traffic). Your CPC should be around $0.50-$1.00, which means you’re paying between $50 and $100 for 3-4 purchases, putting your CAC anywhere between $12-$33.

5. If you’re not hitting these numbers, you have a CRO issue or a quality of audience issue. Figure this out through data relationships.

6. Use data for repeat and return purchases to understand likely buying periods. Generally, the top 25% will purchase again within about 8 days from the first purchase, the top 50% will do so in around 16 days, the top 75% in 30 days, 90% within 60 days, and 99% can take up to 5 months. (These are percentiles, ignore the 90%+)

7. Know your numbers on repeat purchases and offer discounts and bundle suggestions relevant to existing purchases accordingly. Don’t go too early, but know your confidence intervals based on the sale number and automate all of this.

8. Email campaigns should now be automated and straight forward, product releases, company updates, customer spotlights, and occasional sales (though you really shouldn’t need sales anymore if you have your automation setup proper) this should reduce your emails so people will look forward them again.

9. Stop tracking ads by ROAs, instead pay attention to the cohorts that are driving repeat revenue by signup data patterns and answers they provide to determine trends on quality. Now adjust your entire acquisition strategy to find more people with patterns like those that are regularly converting more than once.

10. Become data first, profit and grow.

Sidenote: This framework works on repeat for multiple purchases. If you’re one and done YOU REALLY NEED TO COLLECT DATA AND SCALE to move into retail distribution. Buyers want to see sell through and knowledge about your ideal customer and what matters to them. They have large email lists, but you need to help them connect the dots. If you have data, it’s that simple. It’s all offers and timing.

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