About the business
Tell us a little about yourself. What’s your background? How did you start the business?
I’ve been doing eCom for a couple of years. My background is in marketing, however, my interests are in the early stages of creating and building brands. I started this business after I found a range of products being sold by another company and saw an opportunity to make a brand around it.
Over a few months, I created a branded funnel, bought inventory, and improved the product and customer experience so that I could be the most competitive brand selling this product. I was able to achieve this, outcompeting the original store I found the product in (they closed their store shortly after I scaled mine).
As an eCommerce business, where are your products made?
All products are made in China.
What can you tell us about your Customer Lifetime Value (CLV) and Customer Acquisition Cost (CAC)
CLV= $40.94, CAC= 12.01, however, these can be greatly increased through email marketing which I haven’t really utilized. In addition, there is a strong opportunity to create a sister store which would provide more opportunities to sell to the current customer base as well as gain new customers.
How have you marketed the product and where are your customers originating from?
I’ve primarily been using Facebook to market. Over time the business has been gaining more and more organic traffic through SEO. I’ve tested Pinterest and Tiktok briefly and was able to get profitable sales. However, I didn’t test enough creatives (3 creatives on TikTok, 2 creatives on Pinterest) so the sales weren’t consistent. I strongly believe consistent sales can be achieved through testing more creatives.
Is the asset on your listing owner-operated, how much time does it take to run the business, who else is needed on the team, and what is automated?
The asset is owner operated by an agent in China who deals with fulfillment. So far the business takes about 1-2 hours a day to run. I send orders to my agent and tracking codes are uploaded through an app. Customers are also given shipping updates through a tracking app (Traktor). Nobody else is needed, however for the sake of time it may be worth outsourcing.
What does someone need to do to continue operating the business in its current form?
Familiarise themselves with the customer service templates as this will cover 99% of customer queries. This will also make it easy to hire someone if they wish to outsource customer service. Keep an eye on Facebook and Instagram DMs as people tag the business in posts often. These posts can later be repurposed for ads and other content. Finally, take over the Facebook ads account. The account is structured in a way that’s easy for anybody to take over and I follow a simple strategy that’s allowed the business to be profitable long term.
Growing the business
Can you list a few opportunities for a potential new owner to continue growing the business?
The lowest hanging fruit will be utilizing emails – We have over 15k active profiles on Klaviyo. There are many customers who have only purchased once. I haven’t made the most of the email list and only set up 4 flows. I’ve only run a few campaigns but they’ve all been successful. Due to our great customer experience, it is likely that many will buy again with simple flows and campaigns.
Expanding the product line – Our current supplier has several products that would be appealing to our current customer base. These products would best be sold by utilizing the great relationship we have with our customers and opening up a sister store. A sister store would also provide more opportunities to sell to the current customer base via email. A lot of customers have also suggested new designs, so there is also an opportunity and demand to design your very own products.
Other marketing channels – I’ve tested Pinterest and Tiktok in the past I was able to get profitable sales but was unable to achieve consistent results. This is due to my laziness and inexperience. I only tested 2 creatives on Pinterest and 3 creatives on Tiktok. The fact that I was still able to get profitable sales is evidence of the potential of these platforms. I believe that these products can be marketed on these channels with the correct strategy and with more testing. Also, we have a lot of UGC content to work with, so it’s just a matter of trying out the right combinations.
Google ads – We get quite a few sales through google organically. Though there are sellers selling similar products there’s nobody specializing in just these bags, which gives us a very competitive USP – this bolstered by our superior branding, customer experience, and product quality makes the brand even more competitive (we were able to outcompete our main competitor). This competitiveness is further supported by the fact that we have more positive reviews than anyone selling this product (even on Amazon) it shouldn’t be hard to compete on this platform.
Influencers and affiliates – I have used some affiliate/influence marketing and have done so profitably. I have an affiliate portal and system already set up. Again due to laziness, I haven’t gone out of my way to actually reach out to influencers to ask for collaborations, instead people apply or DM me and offer their services. There are a lot of opportunities here for a more proactive approach to influencer marketing as there is already a sales history proving that it works. Also, once a few influencers have been found they can help make more UGC and more ads.
Wholesale – We’ve had quite a few small businesses reach out asking for wholesale prices. I haven’t taken advantage of this at all, so this is an untapped opportunity.
What has been the evolution of this asset since its launch?
This began with finding creativity that worked well and consistently. Once consistent sales were reached I worked on improving the quality of the product and branding the packaging. I then bought a premium theme, branded the store, and added some unique photos. Finally, I scaled the store up and built a strong reputation so that other competitors would find it hard to enter the market.
How does this business make money? What are the current revenue streams?
Currently, most revenue has come through social media marketing. 18% of sales come from organic traffic due to the store’s SEO. We gain some revenue through email but there’s definitely more that can be done with this channel. We also have an affiliate system that brings in a few sales. The affiliate system is very passive, but it has been proven to work; so there is an opportunity to create an active affiliate strategy that produces consistent revenue.
What marketing channels are most profitable for the business?
Social media, Organic and Affiliate.
How does the business currently acquire customers and what is your breakdown for marketing costs?
The business mainly acquires customers through social media; this costs roughly $9k+ a month but varies month to month. Klaviyo (email app) costs $100 a month and Uppromote (affiliate app) costs $69.99 a month + product cost if sent to influencers.
How big is your current team? How many people does it take to run this business?
The business is run by me with an agent in China who handles the fulfillment side. This agent has its own warehouse where the products are stored before the sale (shipped from China but not dropshipping)
What’s the reason for selling your business on Flippa?
After I’d built the brand up to a certain point, I left the store on the semi-auto pilot and spent more time with friends and family. I got lazy and stopped working on the store to make it grow. This resulted in a dip in sales which you can see more recently. Though there is a lot I can do to bring sales back up, I just don’t have the motivation and would much rather focus on new projects. So instead of letting the business sit there, I think the best thing to do would be to give it someone who can give it the attention it deserves.