Breaking Down The Customer Acquisition Strategy of a 7-Figure eCommerce Business

Marketing is the most powerful component of your eCommerce business. It’s so powerful, that even supposing you have a “me-too” product and activate in a crowded niche, using a business model with low barriers to entry (such as dropshipping) you can still make big money.

Proof? That’s what I’ll show you today.

We’re going to break down the marketing system of what seems to be a 7-figure eCommerce business judging by the extent of their marketing machine and showing you exactly how they’re making the magic happen.

The company is called Project: Yourself, and they are a dropshipper in the niche for spiritual jewelry. Based on their testimonials and advertisements, they’re targeting middle-aged females, who feel broken inside and thirst for spiritual healing.

Many of their products are straight off Aliexpress. For example, here’s the 7 Chakra Healing Crystals Bracelet on their website, and then on Aliexpress.

At the moment of this writing, the bracelet costs $5.93 on Aliexpress and Project: Yourself is selling it for $49.99, a 743% markup!

So what makes them able to achieve such gigantic markups and build what looks like a gigantic million-dollar business around it?

Clearly it’s not product – the product has no differentiation and is cheaply available.

It’s not a great, world-changing idea – they are just selling trinkets off Aliexpress.

And it’s not great customer service, as TrustPilot shows, 71% of the company reviews have given it 1-star out of 5, and they have an average rating of 2.4/5 at the moment of this writing.

Marketing – The Secret Key That Makes This eCommerce Business a Raging Success

The answer is marketing. All the differentiation and success stems from effective marketing. And by that, I do not mean just great copy, although great copy is certainly part of it. It is about the marketing system that is used.

You see, Project: Yourself is using a superior marketing system to sell its products and bring new customers into its fold. Unlike most other stores, Project: Yourself has made the switch to the business model of the future for eCommerce.

I’m talking about switching from the traditional storefront to the sales funnel, as explained by the eComTrends.org State of eCommerce 2020 Report (if you’re interested click the link, and you’ll be able to grab a copy for free) which reveals why the biggest winners in eCommerce in 2020 are switching to this new model.

What is a Sales Funnel & How is it Different From a Traditional Storefront?

Simply put, a sales funnel eliminates distractions (irrelevant links) and takes control of the buyer’s journey to deliver a more relevant and more personalized experience for the consumer.

So instead of a full-blown Shopify store (below a screenshot of Project: Yourself’s Shopify store) you have a product-specific landing page with a single link: purchasing the product (also shown below).

VS

Why Use a Sales Funnel Over the Traditional Storefront?

There are several reasons that make the sales funnel more effective than the traditional storefront for converting cold traffic and getting first-time customers. Here are the top 5 most important reasons:

1. A sales funnel eliminates distractions and focuses the attention of the customer on the product at hand. Compared to a traditional storefront, a sales funnel has only one link, one path, that the customer can take.

2. As a follow-up benefit to the previous, because there is only one path the customer can take, a sales funnel allows increased personalization which leads to higher conversion rates.

3. The increased personalization allows you to string together a series of upsell offers to maximize the average transaction value… instead of just breaking even, you can make a significant profit even on the frontend on each customer.

4. A sales funnel is geared towards beginning a relationship and building trust with the customer, successively providing more value around that same core problem. This begins with the upsells and continues with the email backend, and thus maximizes the number of transactions per customer.

5. One-click upsells make the purchase experience much easier for your customers since they don’t need to enter credit card details again, thus increasing conversion rates over traditional Shopify stores.

Breaking Down a Project: Yourself Sale Funnel

Even though Project: Yourself also has a Shopify store, that is mostly not the strategy they’re using to acquire first-time customers. Instead, they rely on special offers delivered via funnels, and then use the Shopify store through their back-end email marketing. Here’s how such a funnel works:

1. The Ads

The main purpose of the ads is to grab people’s attention and drive traffic to the landing page of the funnel. Project: Yourself resorts to social media for ads, namely Facebook & Instagram because they can reach a large number of people and it holds the attention of a large part of their target audience. Furthermore, Facebook’s detailed targetting methods allow you to target not just demographics but also psychographics which makes it very powerful.

Using the Facebook Ads Library, we can see all the ads that Project: Yourself is currently running on both Instagram & Facebook. For our purposes here, we will focus on one ad and analyze the specific funnel the ad relates to. So let’s focus on this ad:

What’s special about it?

First of all, the offer.

It’s a purple cow, not something that you usually see on Facebook. An item being given away for free – an offer that can STOP the customer dead in his tracks. Of course you have the “Just pay for shipping” written below in a harder to read color.

There is an attention-grabbing benefit-driven headline at the top, along with the emojis to grab attention. The rest of the ad goes over the remaining benefits of the product and links to the landing page.

2. The Landing Page

From the ad follows a landing page, and not a typical product page in a Shopify store. The goal of the landing page is to present a very specific offer to the target audience of the ad while eliminating all distractions and allowing for just one possible buyer’s journey. The conversion goal of this landing page is just to get the audience to submit their email, for re-targetting purposes in case they do not buy.

Note the differences compared to a traditional Shopify product page: there is no menu or other links to distract the customer. Everything is dedicated to this special offer that follows on from the ad, along with the fact that it is FREE and scarcity.

The only link they can click is the button to purchase. When clicked, or when the user tries to exit the page, the following pop-up shows up:

Why does Project: Yourself do this? On the one hand, it makes it seem to the customer that it really is free, so it makes it low friction to put in the email. On the other hand, Project: Yourself gets the email before asking for payment so that they can re-market in case the customer doesn’t buy on the next page (more on this later).

3. The Order Page

After submitting the prior form, customers will reach the order page. The order page has one purpose: present a special, appealing offer to the buyer to get their shipping and credit card details, thus getting them to make their first purchase with you.

Observe that customers are presented with two additional gifts that they will receive, not just the free item in exchange for paying for shipping.

Notice also the multiple pricing options for the number of items, plus the order bump which is essentially pure profit.

Nevertheless, the point of this offer isn’t to make money on the acquisition of new customers, although that is certainly possible with the multiple pricing options and the order bump. The goal is just to acquire a new customer and get their contacts details without losing money.

So what happens if someone submits their email on the first step and doesn’t buy?

4. Add to Cart Re-targetting Emails

Well, here we come to the “add to cart” re-targetting emails. This is a series of 7 emails that will go out to everyone who submitted their email, but did not complete the order form.

The goal here is to maximize the number of purchases that go through the funnel, so that the advertising cost of bringing them to the page isn’t lost.

Great copy is used combined with a series of different angles to drive people back to the order page to complete their purchase.

5. The One-Click Upsells

For those who choose to buy, unlike in a regular Shopify store, after they purchased one product, they are not taken to order confirmation… Instead, they are shown a series of 3 one-click upsells, one after another.

The reason for showing the upsells successively is in order to maximize the average transaction value. Project Yourself paid money to have these people go through the funnel, so maximizing the profit is the next logical step.

For each upsell, they are given the option to accept it, in which case their credit card is automatically charged without requiring them to put in their details again, or refuse it.

To make sure they complete the process, Project: Yourself takes the “Wait – your order isn’t yet complete” angle.

Pay attention to how the upsells are persoanalized for the first item that they purchased. This helps consumers see more relevant and personalized offers for their interests, as opposed to a regular Shopify store. And they have a simple yes/no choice to make every time.

First One-Click Upsell

Please note that this first upsell also starts a subscription, giving them a recurring source of revenue of $149.95/month, but the first 14 days are free, costing just $9. Those who desire instant gratification can easily be pulled by such an offer.

Second One-Click Upsell

And the second upsell is a more expensive item, with a much higher profit-margin. We see that the first two upsells use two different mechanisms to try to create a large profit: a tripwire that starts a higher-priced subscription and a higher priced item respectively.

Third One-Click Upsell

Finally, the third upsell is just a guarantee, designed especially for those who grabbed one of the prior two items. This can be almost pure profit, and will be tempting to those who already spent a larger sum.

These upsells are the “do you want fries with that?” that McDonald’s uses to increase average transaction value. The same thing happens here… so instead of just breaking even on the front-end, they can already make a profit.

Compare this with your average Shopify store where the customer would just have bought the one item… the Shopify store would barely break even, while the funnel model already turns a profit… and in some cases a recurring one too.

6. Order Confirmation + Shopify Cross-Promotion

And finally, they reach the order confirmation page. But wait! It’s not just a regular order confirmation page. It has personalized offers based on similar products the customer may be interested in, directing the customer outside of the funnel to the Shopify store.

So the purpose becomes threefold: confirm the customer’s order and provide a receipt, ask customers to share the page, and provide special offers that are more expensive and lead to their Shopify store, which is another chance at maximizing lifetime value.

As you can see, these products are more expensive, with higher profit margins for Project: Yourself.

7. Backend Email Marketing Promotions

And finally, once you have purchased something, your relationship with Project: Yourself has just begun. The purpose of their email marketing is to promote their other products and increase the number of repeat buyers. At this stage, many of their Shopify products which are more expensive, but not only them, will get promoted to you.

This is where the big money is probably made. As customer trust starts to build up, these more expensive offers become easier to sell. Not to mention the promotions that happen for Holidays, Black Friday, Cyber Monday and so on.

It also helps Project: Yourself build up that most valuable asset: a customer list. This is especially valuable if you want to sell your store at a later point to a strategic buyer… they will be very interested in your list, how well it is maintained, and how responsive it is.

Project: Yourself Uses Multipel Funnels to Acquire Customers

And this was just one funnel. Project: Yourself uses multiple funnels with customized offers to attract new customers. Most of their promotions go through the funnels, simply because the funnels are a more effective way to gain new customers than the traditional Shopify store.

Each funnel enables Project: Yourself to target a different niche of customers with a different core problem, which the products advertised in the funnel help address. This great marketing system is the key to success in eCommerce in the future.

Wrap-up

So there we have it. The break-down of a powerful customer acquisition system that enables an eCommerce store to scale despite conversion rates being on the decline overall. The key is the higher average order value that a funnel obtains, plus the relationship it successfully builds with different segments of the market, which translates into more repeat purchases.

As you saw, this business is entirely fuelled by great marketing, and despite lacking in the product, fulfillment, and customer service departments, it is still able to probably pull in 7-figures.

Just imagine how much better your eCommerce business could do if you switched over to sales funnels for customer acquisition and had a stronger product, fulfilment and customer service strategy… 8-figures? Or more?

If you have any questions or comments, please let us know below. Thanks for reading!

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