Date:

27 May, 2021

Subscription Electronics eCommerce Startup—changing the World’s Water—Scaled profitably from $0 to $200,297 per month in 4 months

To make this “overnight success” possible, we actually worked for 12 months during the off season to get ready for a big scale up. 😂
Here’s a couple of concepts we used to scale this brand:

  • Business model & pricing split testing that increased our conversion rates 9 times!
  • Lead generation-based eCommerce funnels that converted to sales at 10%
  • Creative Hypothesis Testing Framework that helped us scale ads to $2K per day in 1 month
  • Google ads strategy from keyword testing, hacking Google Shopping for subscriptions, optimizing ROAS, and scaling
  • Email marketing hacks for getting 60% open rates and 17% CTRs!

The Brand

Mysutro.com is a VC-backed Silicon Valley startup aiming to improve water safety in the world. After trying to offer their solution to the Indian government (it’s VERY difficult to work with governments as a budding company without massive capital backing and time), they decided to pursue world water safety indirectly. First, they would build capital and drive  technology costs down and then refocus on the core issue later when the timing was right. Their current product offering is helping swimming pool owners keep their pools clean and safe on autopilot using an IOT sensor robot device!

Building brand awareness and sales for a completely new product category means there’s no playbook and no competitors to copy.

We had to use all our team’s brainpower and our systematic growth hacking toolkit to figure out all the variables one by one: business model, pricing, funnel, acquisition channels, and ad creatives. 

What’s more, pool chemistry is a complex topic. So another challenge was to educate  users and convince them of the benefits of the product and why they need it in their homes.

On top of that, we were dealing with a very seasonal market and we needed to get all the data to optimize our funnels during the down season, so we could get ready for the scale when spring came.

Business Model & Pricing Tests

Funnel Testing

Sutro aimed to make the complex problem of pool chemistry simple for its customers. To do that and demonstrate the superiority of the new system required quite a bit of user education in order to convert. 

We tested 2 funnels to see which converted better:

Facebook Ads Strategy

We didn’t focus on hard selling the product initially but started slowly building brand awareness within subsegments in the potential market with the help of lead gen campaigns and a series of educational videos that promoted all the benefits of the product.

Here we were focusing on verifying the potential of the subsegments by looking at add-to-cart rates, engagement, and overall conversion rates (we had a low benchmark here because nobody actually buys pool equipment during fall or winter 😀).

We were collecting the data and working on creative testing at the same time in order to boost the click-through rates and accumulate social proof on the ads. This would eventually help us get into cheaper auctions and have more trust factors for when the season actually started.

Along with that, we started building a series of educational videos that users will watch in sequence  to educate themselves further about the product. We also knew how important creative strategy and the rotation and variety of creatives would be, as the total target market of pool owners is around 10M, which doesn’t give us a lot of space for scaling.

The Results

As a result, we were able to cut the cost per acquisition by 30% to what we eventually set as a target and increased the overall sales 3x compared to the previous year, with a forecast to grow sales 10x  by the end of the summer season.

✅30% lower CPA compared to target CPA
Scaled from $200/day to $2000/day (and counting) in less than 10 days
✅300% increase in sales compared to the same time last year

Creative Strategy

Most marketers test random new ad creatives. Growth hackers test hypotheses. 😀

We hypothesize factors that can lead to a lift in the metric we’re trying to optimize. Then we design tests that will get us the right data, while controlling for confounding factors, executing fast and analyzing the data. For example, if we want to test whether social proof-based ads will outperform mechanism-based ads, we’ll test 5-6 very different social proof ad formats (e.g. testimonial UGC video, testimonial collage, video, and review carousel) and a few versions of control creatives, while controlling for factors such as the gender of the person in the testimonial.

Here are some of the hypotheses that were accepted and continue to perform well for us.

1) Two Core segments in our market required different emotional resonance
For 25-45 year old technophiles who want to be the earliest adopters of new technology, we created ads that are futuristic. We emphasized the product’s technical features, the smart integration of the product with the Cloud, and the sleek design of the product.

For the 45+ year old  demographic, we designed ads that evoke emotion and nostalgia.  We hook them into our ads by bringing them back to their childhood…back to when they stopped using phones and cassette tapes. Then, we bring them forward to the future…to a time when smart technology has made their lives much easier. 

2) Testimonials from influencers/industry experts outperform non-UGC ads on TOF in this niche
The top-performing ad is a testimonial from a well-known industry expert in the pool industry. In his testimonial, he not only showcases the entire customer journey with the product, but also compares the product with its competitors and alternatives.

3) Presenting our product in contrast to competitors using Comparison Ads helps regain the trust of dissatisfied early adopters
One issue with the product is that its competitors didn’t deliver on their promises to accurately measure pool water chemistry. Therefore, many early adopters lost trust in this type of smart home technology.
To clearly show that this product is different and that consumers can put their trust in this product, we did several comparison ads that clearly highlight the unique selling points of the product and the difference between it and its competitors. 

4)We experimented with interesting and funny pattern-interrupt hooks
Such hook ideas included:
– The idea of evolution: We put a comparison graph of the old VS and the new method of pool water testing alongside a graph of human evolution from chimpanzee to human.
– The golden ratio of pool chemistry: We reinforced the idea of “golden” with a golden retriever sitting next to the product.

Google Ads Strategy

Goal:
-Scaling spend to $10K per month at tROAS at 2x with tCPA below $200

Challenges:
-Ramp up account during low season
-Limited search volume & amp; Keyword pool

Strategy & Optimization:

Dynamic Search Activation:
To make sure we cover all relevant search queries before the start of high season and discover new ones, we set up Dynamic Search Ads to: a) expand the keyword pool, b) drive more traffic to the website, and c) see which keywords show potential.

Search Term Expansion & SKAGs:
Initially all search campaigns were segmented by product type: pool, hot tub, and spa monitor. As we were moving into the pool opening season, the focus and budget were shifted to the pool product, i.e. the pool campaign. Having analyzed the search terms report on DSA and broad match keywords, we discovered alternative search queries to target (e.g. pool sensor or pool tester). As a result, in order to maximize budget spent and Impression Share, the pool campaign was broken down into several campaigns based on the new keyword categories, resulting in a more layered, more targeted search campaign structure. This split allowed us to personalize ad content and bid higher on keywords with the best conversion rate.

Very Cold Traffic Activation:
Because our conversion rates were very good at this point, we could get more aggressive by expanding our funnel with lower-intent keywords. We set up a more generic search campaign targeting search terms around pool maintenance (e.g. pool supplies, pool chemicals, chlorine for pools, pool automation) with the aim of targeting pool owners prepping for pool season and directing them to Sutro’s website to: a) increase brand awareness, and b) build a pool for cross-channel remarketing ads.

Hacking Google Shopping:
Based on our competitor analysis, we identified shopping ads as another key instrument in boosting Sutro’s presence on the SERP. With most competitors running only search ads,  and with our capacity to scale quickly, shopping proved to be a low-hanging fruit to pick.
Given the somewhat unique subscription-based model of Sutro’s pool monitor, the product feed had to be manually set up in the Merchant Center. We then proceeded to run standard shopping ads using eCPC bidding and gradually increased the daily campaign spend to build up traffic volume.

Results:
After roughly a month of gradual scaling, the campaign generated the target conversion level and we switched fully to an automated smart shopping campaign. By cautiously adjusting the tROAS and the daily budget by 10-20%, within a period of two weeks we were able to ramp up the conversions by 55.6%, boost the revenue by 35%, and reach ROAS of above 4x.

Email Marketing Strategy

1) We fixed the lead capture mechanisms in Autopilot to enable proper email collection through our Lead Gen funnel.

2) We removed non-performing, non-essential email flows, revised email template designs, and improved the subject lines. This resulted in an increase in open rates from 20% to 61.7% and click-through rates from 1.3% to 17.3%! 📈😎

Before:

After:

3) We revamped an old non-converting email sequence. We cut it to 5 emails and gave each email a clear purpose: Build a connection with the brand, explain the benefits, position against competitors, present social proof, install urgency to buy with an offer, and improve the subject lines.

The new welcome series converted to purchase at 10.4%!

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