How we built €20,000 in recurring revenue within 90 days of launch

How we built €20,000 in recurring revenue within 90 days of launch

By Niall Harbison.

When I build startups I like to share as much information as possible. I find that it helps others but more than anything it helps me understand the business myself.

We launched Ruby & Duke on 15th February and in less than 90 days we have hit €20,000 in monthly recurring revenue so I thought it might be useful to explain how we’ve done that. We built the platform from scratch in just six weeks and although we currently fulfil all of the boxes ourselves we will be outsourcing that in month four so as we can focus on customer acquisition, marketing, the brand and our content efforts here. I’ve outlined a few things that have worked and which haven’t worked for us in acquiring our first €20,000 in revenue…

The Sales

Sales are the lifeblood of all startups. While many startups focus on user acquisition before worrying about revenue, I’ve been stung one too many times to go down that route. We acquired customers from day one of launching.

The biggest trend that has surprised us is that 42 percent of all sales are coming from mobile devices. We’d optimized the site for mobile and social since day one but even we didn’t think that we’d be heading for half of all sales coming from mobile devices quite so soon.

Content Marketing

I’m a huge believer in content marketing. Companies not embracing it these days are missing a trick. We decided to dedicate two of our team to create our own dog focused website “The BowWow Times“. The site is dedicated to all of the latest dog news, photos, videos and memes tailored for the audience in the countries we are targeting.

The idea behind the site is that it is a lead generation tool for selling boxes. However the traffic has taken off to such an extent (people just love dogs) that we’ve decided to turn it into a standalone business with integrated advertising for large UK brands.

The site was built with mobile in mind. We made sure that everything was optimized for phones and tablets as well as having an iOS app. We’ve been rewarded in that respect with over 75 percent of the traffic coming from mobile devices. The site has delivered in excess of 50 paying customers for the subscription boxes as well as helping us to build up our brand to millions of dog lovers.

Email Marketing

Most marketers tend to write email off these days in terms of acquiring customers. We’ve been able to build up 10,000 email addresses from dog owners in the UK who have opted in to hear about us on dog related news. We’ve done this by using competitions, quizzes (like those below) and with special offers.

1x

Our email database will grow to over half a million people by the end of the year and although we don’t sell to them often, email has resulted in over 100 sales for us.

Targeted social advertising

We’ve had nearly all of our early success using Facebook and Twitter advertising. Due to the incredible precision of their targeting we have been able to blitz every dog owner in the UK and Ireland that we are after. We’ve been able to nail down who our customer is in a very precise manner and retarget them on an ongoing basis.

Half of our customers have been acquired via Facebook and the real beauty is we can ramp this up further once we no longer have issues around being able to supply the demand. Not precisely a tap that you can turn on and off as you want but not far off either.

bowwow

 

We’ve found that Facebook offers have been incredibly useful because of the way they spread virally across the feed once people start claiming them. Although we’ve spent €3,000 to kick off the growth on the page, the last 60,000 likes have all been organic. People really like dogs.

chart

 

While we have been using Twitter, the volume of traffic, sales and interaction doesn’t come close to what we can achieve on Facebook.

User generated social media

When we started out we knew we had a great chance for our users to create the content for us on social media. We incentivise them to take pictures of the boxes and their happy dogs. We’ve already had 1,000s of photos on Instagram, Facebook and Twitter as well as videos and gifs.

woof

 

Referrals

We didn’t have this at launch but we knew that because people love the product so much it would only be natural for them to suggest it to their friends. Nothing is more powerful than a bit of word-of-mouth marketing so we decided to put it on steroids. In allowing our happy customers to earn free boxes by providing them with a trackable link we’ve seen sign ups pick up pace to a point where we’ll struggle to keep up with demand unless we outsource the fulfilment of the boxes.

plan

Branding

One area that most startups ignore is branding. Most get a logo designed, build a website and then forget about branding. Building an incredible brand allows you to…

  1. Build credibility and trust with customers
  2. Charge people more for your product (think Apple or Audi)
  3. Attract better staff and partners

There are 100s of ways that we do this on a daily basis but one is recording videos and putting a face to our company. Customers will be much more likely to buy your product if they can see a face, see how much you love what you do and get an insight into the business.

Intercom

We started using Intercom on the very first day the site launched. It allows the entire team in the office to talk directly to our customers. It also means we can use live chat to help sell to people who are on the fence about signing up and it is a key element in building a super high retention percentage.

PR

The one channel that most start ups fail to do properly is PR, but as Bill Gates said “If I was down to my last dollar I’d spend it on PR”. It is nearly impossible to track the sales we get from this but magazines, TV and weekend newspapers have been great for helping to build the brand. The fact that we have loads of photos of dogs seriously helps too.

Trade Shows

This is the one that went better for us than expected. We signed up 50 customers over the weekend by talking to them in the real world and explaining our product. Although it might seem like a low ROI for the time and money spent it also allows us to meet our customers, build our brand further and be seen in the real world. We’ll do lots more of this sort of activity.

What hasn’t worked?

The good thing with this business is that every single sale can be tracked and we are meticulous in following the data. Three channels we thought could be useful but which haven’t been to date are…

  • Google Adwords. People don’t seem to search for our product on Google, yet. Probably because they don’t know that it exists even to search for it. We’ve had about 10 sales from Google.
  • Deal Sites. We’ve run deals across the UK and Ireland on popular discount deal sites. Although they were great at attracting the first 200 odd customers they have all nearly canceled after a month. Just like when people buy deals for restaurants there is no customer loyalty. They’ve been our hardest customers to service and we’ve stopped doing the deals.
  • Affiliate Sales. Admittedly we are early in the process of rolling out our affiliate efforts but they’ve been slow to take off and very time consuming
  • Retargeting. We’ve had about 20 sales from this (Facebook, Twitter, Banners). Where this is super effective is keeping the brand front of mind with dog lovers when they are online.

What’s Next?

We could turn the tap on and acquire customers much faster but we also have to be careful that by doubling the sales each month we don’t lose out on the quality and the delight we provide our customers with every month. Our digital strategy is about refining everything above and getting the cost of acquisition per customer as an exact science. We hope to have 10,000 – 20,000 happy dog customers by the end of the year but keeping them happy is the key.

May 25, 2015 / by / in , , , , , ,

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