Lane201 is a women’s clothing store known for it’s unique and trending styles, quality items, and fashion-forward design. With new styles dropping weekly, they have a large following of loyal buyers.
Prior to running Facebook Ads for Lane201, the client was struggling to acquire new customers profitability. When comparing META ad spend to Shopify new customer revenue, it became clear why the client could not scale at a profitable rate. Our challenge became increasing new customer purchases while maintaining an above-average ROAS on the account.
We used the Pearson Coefficient metric comparing META ad spend to Shopify new customer revenue. The Pearson correlation coefficient can range from -1 to +1. The sign of the coefficient (+ or -) indicates the direction of the relationship, while the magnitude (ranging from 0 to 1) represents the strength of the relationship. With a -0.86 PCC (Pearson Correlation Coefficient), an increase in META ad spend led to an 86% decrease in new customers. The client didn’t know META was taking his ad spend and showing it to EXISTING customers, because they had not properly excluded them from their ad sets. This was causing them to pay for the SAME customers over and over again.
We began by taking over Lane201’s ad accounts, turning off ads that were spending high with little or no return, and began testing warm audiences. We also boosted popular Instagram posts and applied some interest targeting to see if we could find new winning TOF Audiences. Initial results were good but we were running into the same issue the client had with acquiring new customer purchases. New customers that we did acquire had super high CPA over $200. Even though ROAS was good, results were mainly coming from existing customers. With new and existing tests still in place, we began increasing budget and launched dozens more testings campaigns.
Increase in revenue
Increase in ROAS
Increase in CPAs
After internal discussions with the team and talking to the client, we decided that downloading the full customer list and uploading it to the ads manager to exclude purchasers fully in TOF campaigns would be the best course of action. We made this change during our second month with the client, and launched new prospecting campaigns that excluded previous purchasers. After TOF prospecting campaigns went live, targeting lookalike audiences and relevant interests, we saw an increase in new customer purchasers immediately and new customer CPAs dropped dropped by 28.7%.
Although new customer purchases increased, data was not aligning with what we expected, and there appeared to be a “gap” in the data we saw on META Business Manager and Shopify. To counter this, we decided to implement a post purchase survey on Lane201’s store. This unlocks the Total Attribution Window, which provides better insight into what customers are coming directly through META attribution.
Increase in NC Orders
Decrease in CPA
New Customer CPAs dropped by -33.30% month over month while ROAS remained strong above a 3.0x. With this success in place, we set a goal to acquire over 1000 new customer purchases within 30 days, while doing heavy TOF testing. Although this would mean increasing new customer purchases by 10x, our new strategy and Lane201’s annual Christmas in July sale encouraged us that it would be possible. We were right! PCC Shifted to +0.96, meaning that for every increase in META ad spend, new customer revenue also increased by 96%.
Higher ROAS
More Ad Spend
New Customer Orders
Higher Revenue
