Overview
Imagine you are running on a treadmill for 30 minutes. You have burnt a good amount of calories, but you are still at the same place. You might feel like you have put in so much effort, but in reality, you haven't even moved.
Burning calories is good for your health, but burning cash for a D2C brand without moving forward is a sign of poor strategy and management.
Something similar happened with this FMCG brand before they partnered with us for their performance marketing. They were spending on ads and barely getting an ROI of 1.5x, and after accounting for RTOs and other expenses, profitability became even more challenging.
Objective
The primary objective was to identify the root cause behind the brand's stagnant growth, improve advertising efficiency, increase profitability, and build a scalable marketing system that could generate long-term growth.
Challenges
Before implementing any changes, we identified the key challenges that were limiting the brand's growth.
- Burning Cash Without Desired Returns: The brand was investing heavily in paid advertising but was not getting the expected return on ad spend.
- Low Repeat Purchases: Existing customers were not returning to purchase again, resulting in poor customer retention.
- High RTOs: A high Return-to-Origin (RTO) rate was significantly impacting overall profitability.
Audit
We conducted a detailed audit to identify the root cause behind the lack of growth.
- No Proper Strategy: Random campaigns were created without keeping the consumer journey in mind.
- Low AOV: Average Order Value (AOV) was low, which resulted in lower ROI. There was no upsell or cross-sell strategy in place.
- Lacking Creative Strategy: Creatives were added randomly to campaigns without any structured creative framework.
- No Retention Plan: Retention marketing was not implemented, resulting in missed opportunities to increase customer lifetime value.
- High RTOs: The Return-to-Origin rate was significantly high.
- No Optimization: Campaigns were not being optimized and continued running without proper monitoring or improvements.
We openly addressed all these issues during our audit call and explained the time and effort required to fix them. Not only did our team identify the improvements needed within the advertising account, but we also recommended operational changes that the client could implement on their end. From the beginning, we set clear expectations instead of making unrealistic promises.
Our Strategy
Before implementing anything new, we first optimized the existing campaigns with a lower budget to keep sales running while preparing the new strategy.
1. Research
Our team conducted detailed market research to understand the market, competitors, what's currently working, what isn't working, creative ways to communicate the brand story, and customer pain points. This research became the foundation for every campaign that followed.
2. Creative Strategy
We designed a structured creative strategy with different creatives for every stage of the marketing funnel. Creative formats included:
- Brand Story
- Product Pain Points
- Us vs Them
- Testimonials
- UGC Videos
- Reverse Psychology
- Product Manufacturing Process
- Cart Recovery
This approach allowed us to communicate with customers based on where they were in the buying journey.
3. Campaign Structure
Campaign structure played a critical role in improving account performance. Instead of running multiple unnecessary campaigns, we simplified the account structure. Typically, we maintained 4–5 active campaigns, no more than 5 ad sets within each campaign, and no more than 5 ads inside each ad set. This made optimization easier and improved overall campaign efficiency.
4. Funnel Strategy
Simplifying the consumer journey was one of the most important parts of the overall strategy. The campaign structure consisted of:
- Top of Funnel (TOF): Two TOF campaigns excluding all existing customers, one dedicated to testing creatives, and one dedicated to testing new audiences.
- Middle & Bottom of Funnel: One MOF & BOF campaign.
- Cost Cap Campaign: One Cost Cap campaign.
- Advantage+ Shopping Campaign: One ASC+ campaign.
This structured funnel ensured that every campaign had a specific objective within the customer journey.
5. Fixing AOV
To improve Average Order Value (AOV), we implemented Shopify apps that introduced upsell opportunities directly on the product page and cart page. These additional offers encouraged customers to purchase more products in a single order.
6. Retention
Once acquisition was optimized, the next focus was retention. To improve repeat purchases, we collaborated with Zoko and implemented WhatsApp automation flows. The objective was to activate existing customers by communicating product benefits, product use cases, exclusive offers, and repeat purchase reminders. This helped improve customer retention while increasing lifetime value.
7. Reducing RTO
One of the major reasons behind poor profitability was the high Return-to-Origin (RTO) rate, primarily from Cash on Delivery orders. To address this, we partnered with GoKwik, which helped reduce RTO by 17%.
Results
Within 3 months, we scaled the brand's sales to 3X while building a structured marketing system capable of generating long-term growth without requiring constant day-to-day intervention.
Conclusion
This project demonstrated that profitable scaling is not achieved by simply increasing advertising budgets.
A structured marketing strategy, backed by detailed research, creative planning, campaign optimization, customer retention, and operational improvements, enabled this FMCG brand to overcome its growth challenges and build a scalable performance marketing system.