Brewing Success:
Caffè Umbria's 41% Revenue Surge in 90 Days
Size
<10
Founded
2020
Industry
Wellness
Location
USA
Services
Paid Ad’s + Creative
Size
>50
Founded
2002
Industry
Coffee
Location
USA
Services
Paid Ads + Creative
Caffè Umbria is a full-service coffee roaster serving authentic Italian espresso in a crowded coffee roasting landscape.
Caffè Umbria is currently served in hundreds of cafés and fine dining establishments throughout North America, from the Bellagio Hotel and Resort in Las Vegas to the Wickaninnish Inn in Tofino, BC.
With an established reputation in the wholesale business and several storefronts in place, Caffè Umbria grew steadily through organic and word-of-mouth sales. However, their retail business struggled to survive during the pandemic, so during mid-2021, they decided to invest more time and resources into diversifying their revenue channels.
Caffè Umbria needed to:
Determine their Customer Lifetime Value (LTV), so they could adequately assess their customer acquisition issue.
Refine their funnel to tailor new customers visiting their store for the first time.
Create a scalable paid media strategy that leveraged an intriguing offer for prospective customers.
Umbria had a basic Shopify store set up but lacked the internal infrastructure and technical expertise that would allow them to help grow their online market share and rely on multiple channels of income.
The first step was to pick apart Caffè Umbria’s E-commerce store. We audited every step of their funnel, from their social media presence to their paid advertising. From there, we created a priority list derived from the areas of highest opportunity.
Once that was finalized, we rolled up our sleeves and started chipping away…
To start, we needed to work on the website. The site was flooded with functionality flaws and general leaks in the funnel. To the naked eye, these issues were evident, but before our team makes any changes, we always look into the data.
A data-backed decision not only ensures you’re making the right choice but will put you in a better position to scientifically track the impact of your changes.
We followed our standard procedure of installing a heatmap on the site, which allows us to track the user journey much more precisely. Then, through Google Analytics, we broke down each page by total views and drop-offs to determine which pages had the highest drop-off rates.
What did we learn from this research? There was an abundance of funnel leakage. In other words, there were way too many pages. Visitors would spend their time browsing pages filled with fluff rather than product-related pages that actually generated sales. To make matters worse, the majority of these pages didn’t include any call to actions or ways to get back to the product pages.
How did we solve this issue? We simplified the entire website experience. We shrunk the main menu to the four most important (and popular from a click-through-rate perspective) pages. We then took niche pages and consolidated them into more general topics. Finally, we allowed customers to checkout as a guest as this was hindering our new customer acquisition.
The second significant change we made to the website was the introduction of reviews & testimonials. We sent an email to a specific list of VIP customers requesting a testimonial in exchange for an entry into a $100 giveaway.
Additionally, we set up an automatic email to request reviews from customers three months after their order. The average rating from the reviews is 4.86 out of 5 stars.
Next, Caffè Umbria needed a way to track their results beyond Shopify’s basic analytics. Before we dove into paid advertising, we needed a way to both report & analyze the day-to-day business metrics.
We set them up with our profit & loss calculator and helped them understand how these key metrics play into the success of their business. This report is essential to all of our clients as every day, we get accurate metrics combining data across their entire E-commerce ecosystem. From there, we looked at areas to optimize their spending.
With rock-solid reporting in place, we took to paid advertising. Upon teaming up with Flax, Caffè Umbria had no paid advertising presence. They’d run an occasional seasonal promotion on Facebook & Instagram but with no system in place to improve results from one promotion to another.
We established an evergreen retargeting campaign that could run profitably year-round and capitalize on their existing customers and the organic visitors entering their ecosystem. We leveraged Dynamic Product Ads (DPAs) to retarget those who viewed or added specific products to the cart. With the release of the Instagram reel ad placement, we also created high-quality visuals to capitalize on the low CPMs.
Once we had Facebook ads rolling, we shifted our focus to Google. We set up search campaigns for Caffè Umbria as well as their top-selling products. From August to October 2021, Umbria realized a 4.29 return on ad spend. With our evergreen campaigns in place across Google, Facebook & Instagram, we now needed to create a scalable strategy to acquire new customers.
Because coffee is a consumable product, Lifetime Value (LTV) was the name of the game.The returning customer rate was over 42% in 2020, so we knew that customers that converted stuck around.
Knowing the LTV sets up the marketing strategy to focus on increased spending of marketing dollars relative to its top-line revenue. In other words, if we know an average customer spends $400 a year on our products, we can feel good about selling a $75 bag of coffee to a new customer for an acquisition cost of $80 – that’s a 5x ROI over the course of the customer’s lifetime! I’d be happy taking an even bigger loss if I knew our customers stuck around for 2-3 years on top of that.
With LTV anchoring our decisions, an acquisition strategy emerged. Our team built offers revolving around free products, with a value between $20 to $30. We ran gifting campaigns that included products from every corner of our catalogue; Best-sellers like espresso beans to exotic teas that can’t be bought anywhere else. We even tested merchandise as a gift!
How did this strategy fair? Why don’t we look at the numbers…
