Stop Walking & Start Running: How a Sneaker Startup 3X its Revenue

By admin / December 20, 2019

4 min read

SneakerTub, the North American subscription service, boosted results in just 3 months!

  • With so many brands bidding for ads online in the ultra-competitive North American market, upstart SneakerTub’s customer acquisition costs had gotten out of control.
  • With Alavi’s AI, the company was able to identify and focus only on audiences that had a high intent to buy, which significantly improved returns at every level of the sales funnel.

1.    Everyone Wins Every Month.

From books to makeup to ingredients to movies, subscription services are now available for almost anything. Customers love them because, for a nominal fee, they get something new every month. And businesses love them because they get to hold on to customers for longer and get paid every month.

2.    Don’t Just Do It. Subscribe To It.

Sneakers have gone from sports shoes to fashion accessories to prized collectibles that people spend lots of money on. Inspired by this, North American ‘sneakerhead’ and entrepreneur, Kamaj Silva, launched SneakerTub, the world’s first sneaker subscription service. With it, people could finally get a new shoe fix every month from top brands like Nike, Puma, and Saucony without breaking their bank account.

3.    Ready, Set, Go (On A Hit Show)!

Impressed by the SneakerTub idea, the brand was invited to pitch on the hugely popular business reality TV show Dragon’s Den. Kamaj himself presented and had top investors bidding against each other to put money into his startup. This earned SneakerTub a ton of publicity, which quickly turned into strong organic growth.

4.    Online Marketing, Here We Come.

To keep its early momentum going and give sales another boost, SneakerTub decided the time was right to start advertising online. Focused on North America and targeting a young audience, the company initially used Facebook Marketing because it placed ads on both Facebook and Instagram.

5.    It’s Brutal Out There.

In North America, online advertising is highly competitive with many, many brands bidding for exposure. It’s especially fierce amongst subscription services who earn more per customer because they’re willing to place higher bids. SneakerTub, whose goal was to scale profitably, suddenly found itself in a war against soaring customer acquisition costs. It tried to use the ad platform’s intelligent targeting tools to make its campaigns more efficient but, because they’re primarily focused on repeat business and new customers, they did not deliver the right results.

6.    Try AI?

Desperate for a solution, Kamaj discovers that the most successful online advertisers use artificial intelligence (AI) to optimize and scale their campaigns. He learns that with AI, the vast amounts of data from SneakerTub’s website, CRM and campaigns can be correlated and analysed for insights which not only reduce acquisition costs but also boost revenue growth.

7.    Finding the Right Fit.

Excited about AI, Kamaj initially found that most AI services for digital marketing were expensive, complicated and took a long time to deliver results. Persistent, he eventually came across one option he thought might be a good fit. Alavi is an online AI application that focuses on decoding and optimizing the entire customer journey. It’s been shown to improve returns in just 30 days. Best of all, it’s developed specifically for small and medium businesses, which means it’s simple enough for even an inexperienced marketer to use and cheap enough for an up-and-comer like SneakerTub.

8.    Hit The Ground Running.

Connecting Alavi to SneakerTub’s website and ad platforms was seamless and its AI engine immediately kicked into gear. Analysing over 200+ variables, it reverse engineered the path customers to took to convert and found which personas had the highest intent to buy (including the critical insight that many parents were subscribing to SneakerTub for their kids). Alavi then suggested different audience and product combinations to boost results at every level of the sales funnel.

9.    “It Put The Kick Back In My Kicks!”

In just three months, using Alavi’s recommendations reduced SneakerTub’s customer acquisition costs, the company’s biggest headache, by 33%. They also increased return on ad spend by 118% and, best of all, rocketed revenue up by an incredible 212%! As Kamaj would later say “Alavi’s targeting was so precise and so powerful. It put the kick back in my kicks!”


Use Alavi for Free Now

Developed for small and medium businesses, Alavi is a martech application that performs predicative analytics on your customers’ behavioural data. By combining AI, machine learning and automation, it gives digital marketers the cohorts and workflows they need to quickly target their most profitable audiences and boost campaign performance.

Alavi has a proven record of helping brands in a variety industries grow their revenue online. It has a very short time to value and is easy to setup and simple to use.

If you would like to get a demo of Alavi and start using it for free,
please email [email protected] or visit www.alavi.ai