In late 2023, a rapidly growing online store specializing in pet products faced a significant challenge in scaling its online presence. The store offered a wide range of products, including food, accessories, toys, grooming tools, and health-related products for pets like dogs, cats, birds, and reptiles. While the business had gained some initial traction in the pet care market, its ability to convert traffic into consistent sales was lagging, and there was a noticeable stagnation in customer retention rates. The holiday season in December 2023, which should have been a profitable period for e-commerce, yielded disappointing results, with an overall conversion rate of just 1.2% despite increased site traffic. This was well below the industry average of 2.94% for e-commerce pet stores.
The store had been relying on a basic Google Ads campaign with broad targeting, and while impressions were high (over 1.5 million in December), click-through rates (CTR) were unsatisfactory at 1.1%, and return on ad spend (ROAS) was severely low at 1.6x. Compounding this was the fact that the store's email marketing efforts had an average open rate of 12.3%—again, underperforming compared to the pet industry's 18.1% average open rate. Their email click-through rate (CTR) was abysmally low at 1.8%, indicating a misalignment between the email content and their target audience's expectations. The main goals moving into 2024 were to increase the conversion rate, optimize ad spend, and improve customer retention by leveraging a more data-driven and personalized approach to advertising and email marketing.
With an annual marketing budget of $250,000, the store allocated $120,000 to contextual Google advertising and $30,000 to email marketing for the period of December 2023 to April 2024. The store’s main competitors had already invested heavily in aggressive digital campaigns, leaving the pet product store in a vulnerable position.