E-commerce
The Snuggie
In late 2021, COVID was still on and online shopping was at an all-time high. Additionally, electricity prices were rising rapidly, which gave birth to the idea of selling a large and warm piece of clothing which we called the 'Snuggie'. Together with my friend and roommate, we incorporated a company and sourced the first batch of inventory under the brand Snuggie. The Snuggie was not novel and we didn't do any product development ourselves. We simply marketed an existing product which we knew was selling well in another part of the world (ironically it was one of the warmest places on earth, Australia).
The first sale was the hardest. It took three days and 500 NOK in Facebook ad-spend to sell the first item (for 600 NOK). This of course meant that the sale was not profitable, but getting a stranger to buy something online was nevertheless motivating enough to invest time into improving the store. We worked on the copywriting, ad creatives, landing page, customer tracking and much more, making the next few sales much easier.
We started the company in late November 2021 and spent the first two weeks building the initial Shopify store and getting the first sale. In December, our first full month, we already had 200 000 NOK in sales (approx. 20 000 USD). That month was a crash course in modern direct-response marketing. That is, marketing that is data driven and traceable. We had to learn the basic but important metrics, such as CPM, ROAS, CTR and the principles behing CRO. We also had to learn the mechanics of the Facebook ad platform, including how to optimize campaigns, how to perform split tests and so on. We even got to hire UGC (User Generated Content) creators.
The sales peaked in mid January after we released new product lines (such as accessories and 'Supersnuggies') and scaled our marketing spending. We peaked at around 24 000 NOK/day (2500 USD/day) in sales. At that run-rate (assuming no further growth) we were on track to do almost 1 million USD per year in sales. There were however some issues.
After quickly selling out the initial inventory, we switched to the dropshipping model in order to keep up with demand. This became an issue due to late orders and constant customer inquiries. In addition, COVID caused container prices to surge and deliveries started to take longer than usual. This meant that ordering a new batch of inventory would be a month-long struggle at best. We weren't that passionate about selling Snuggies, so we made sure all customers got their orders and shut down shop.