One of the quickest ways to scale?
— Philip Pages | w6 (@philip_pages) April 6, 2023
Have your customers spend more.
Here's a clever strategy Javy uses to juice AOV and crush the competition: pic.twitter.com/4y7wky6S0Y
What's the sauce? Free gifts.
— Philip Pages | w6 (@philip_pages) April 6, 2023
It sounds simple, but there's a lot going on under the surface.
Here's what Javy is doing differently:
1) Incentivizes customers to spend more through gamification
— Philip Pages | w6 (@philip_pages) April 6, 2023
Javy uses the following rewards structure:
1-2 bottles = Recipe book
3 bottles = Recipe book + straws
4 bottles = Recipe book + straws + mystery gift pic.twitter.com/rZUmUODlqu
As the customer spends more, they unlock more value.
— Philip Pages | w6 (@philip_pages) April 6, 2023
But the gifts aren't just random items.
They are things that a coffee drinker would reasonably use and want.
The mystery gift at the end is particularly juicy.
— Philip Pages | w6 (@philip_pages) April 6, 2023
Surprises hack into our brain's dopamine systems.
Offering a mystery item helps make customers that much more excited about their order and increases the probability of conversion.
2) Decrease per unit pricing with more volume
— Philip Pages | w6 (@philip_pages) April 6, 2023
In addition to free gifts, Javy sweetens the deal by offering discount pricing
1 bottle = $18.95/ea
2 bottles = $16.95/ea
3 bottles = $14.95/ea
4 bottles = $12.55/ea pic.twitter.com/C9ZZfZXZQO
Between the gifts and cheaper unit pricing, this offer becomes a no-brainer.
— Philip Pages | w6 (@philip_pages) April 6, 2023
Why would anyone choose to spend more for less?
The answer: they wouldn't.
Javy has made it so someone would feel guilty for not opting in for the most expensive option.
3) Recurring subscription revenue
— Philip Pages | w6 (@philip_pages) April 6, 2023
Here's the real beauty of this strategy.
This amazing deal is built on a subscription product.
Once the customer opts into the no-brainer 4-bottle + 3 gifts offer, they are charged month after month.
It's possible Javy loses money on their first acquisition.
— Philip Pages | w6 (@philip_pages) April 6, 2023
But if their retention is high enough, they can afford it because they'll break even in X months.
Then everything after that is gravy (Side note, this is how SaaS acquisition works).
All the hard work was done on the front end crafting and testing the offer.
— Philip Pages | w6 (@philip_pages) April 6, 2023
Once someone subscribes, Javy doesn't have to deploy as many resources to retention efforts.
This extra budget can then be allocated back to ads.
They've essentially built a monster scaling flywheel:
— Philip Pages | w6 (@philip_pages) April 6, 2023
Great subscription offer = High AOV + High conversion rate + High LTV = Ability to spend more on ads
More customers see the offer and convert and the cycle continues.
The gifts are core to why this offer works and helps them achieve this flywheel effect.
— Philip Pages | w6 (@philip_pages) April 6, 2023
Pricing alone wouldn't be as exciting of an incentive.
However: pricing + fun gifts = magic.
