Case studies / Health supplements
Health supplement brand: bundles and a TACoS budget model
+50% Sales, first quarter to second
Challenges
The brand aimed for ambitious growth, targeting a 50% year-over-year increase in sales. The challenge was to boost sales while managing advertising spend efficiently and improving organic ranking on Amazon.
Objectives
The primary goals for the brand included:
- Achieving a 50% year-over-year increase in sales.
- Enhancing product offerings through strategic bundling.
- Improving organic rank and driving more sales by adopting a Total Advertising Cost of Sales (TACOS) model.
Strategy
To achieve these objectives, the following strategies and tactics were implemented:
- Product Bundle Strategy: We introduced a product bundle strategy aimed at upselling current listings and expanding the product offering. This approach was designed to increase average order value and attract more customers with value-added bundles.
- Switch to TACOS Model: We shifted from a set budget model to a Total Advertising Cost of Sales (TACOS) model. This change was intended to help us increase organic rank and drive more sales by focusing on the overall efficiency of ad spend relative to total sales.
Implementation
- Product Bundling: In the first quarter, we developed and launched several product bundles. These bundles were carefully curated to complement existing listings and provide added value to customers, encouraging larger purchases.
- TACOS Model Adoption: Starting in the second quarter, we transitioned to the TACOS model. This involved realigning the advertising strategy to focus on the holistic impact of ad spend on total sales, thereby enhancing organic rankings and driving incremental sales growth.
Results
The strategies and efforts led to significant improvements over the past year:
- Sales Growth: The brand experienced a 50% increase in sales from Q1 to Q2, matching the 50% growth target the brand had set for the year.
- Traffic Increase: There was a 64% increase in traffic from Q1 to Q2, driven by the enhanced product offerings and improved organic rankings.
- Return on Ad Spend (ROAS): ROAS increased by 5% while ad spend increased by 50%. The TACOS model allowed for a more effective use of advertising budget, resulting in higher overall efficiency and sales impact.
Conclusion
The partnership between the brand and our agency successfully met the challenge of achieving significant sales growth. By implementing a strategic product bundling approach and transitioning to a TACOS model, the brand not only met its sales growth target but also improved traffic and advertising efficiency. The ongoing collaboration aims to sustain these improvements and explore further opportunities for growth and optimization.