Post by mdsaikwat03 on Feb 15, 2024 1:08:07 GMT -5
In 2020, though, even Bed Bath & Beyond began moving away from the constant-discount strategy. Coupons can have diminishing returns over time; they quickly go from an exciting opportunity to a constant expectation. We suspected that in our client’s case, the discounts-for-everyone approach was limiting their ability to scale not only their ad campaigns but their entire business — so we set up a split test to find out.
We offered four different versions of their hero product at four different Iceland Phone Number List price points: $90 (their initial offer) $95 $99 with a gift card $99 with no gift card For each price point, we set the following ROAS goals: ROAS goals based on price point We ran the test at scale, and the results were interesting. the $99 offer with no gift card was the second-best performer and had the greatest chance of profitability. ROAS goals at scale - and the best performing price points. The $90 offer, which had the lowest gross profit margin offer, looked most promising based on raw ROAS — but it was closer to its break-even ROAS goal, and we thought the customers who spent $99 might be the higher-value customers.
We waited, and after two weeks, we looked at the LTV on the new customers the campaign had attracted. Not only did the customers who spent $99 spend more upfront — two weeks later, they had spent 20% more than their counterparts who spent $90. Two week LTV by price point While ROAS was higher at the $90 price point than the $99 one, the $99 one had a better gross profit margin — and the customers who bought at that price point seemed more likely to buy again.
We offered four different versions of their hero product at four different Iceland Phone Number List price points: $90 (their initial offer) $95 $99 with a gift card $99 with no gift card For each price point, we set the following ROAS goals: ROAS goals based on price point We ran the test at scale, and the results were interesting. the $99 offer with no gift card was the second-best performer and had the greatest chance of profitability. ROAS goals at scale - and the best performing price points. The $90 offer, which had the lowest gross profit margin offer, looked most promising based on raw ROAS — but it was closer to its break-even ROAS goal, and we thought the customers who spent $99 might be the higher-value customers.
We waited, and after two weeks, we looked at the LTV on the new customers the campaign had attracted. Not only did the customers who spent $99 spend more upfront — two weeks later, they had spent 20% more than their counterparts who spent $90. Two week LTV by price point While ROAS was higher at the $90 price point than the $99 one, the $99 one had a better gross profit margin — and the customers who bought at that price point seemed more likely to buy again.