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Increasing Net Profit for Pet Supplies Brand

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Profit Whales Team on Nov 29, 2022 in Case Studies

Increasing Net Profit for Pet Supplies Brand

Net Profit vs Total Sales vs Organic Sales

 

Company Background

The brand we will cover today belongs to the Pet Supplies category. The company manufactures supplements and vitamins for small, medium, and large dog breeds, providing them with well-being and longevity.

The pet industry is one of the most profitable and ever-growing, with an estimated 6.1% constituting annual growth rate. And, of course, this market is characterized by fierce competition.

 

The Challenge

In terms of business operation, the brand was doing well, but advertising campaigns began to sag in efficiency over time. We had to find out what was wrong and fix the problem to bring traffic, sales, and profit to a new level.

 

The Solution

We carried out a qualitative analysis of previous campaigns and determined that the main “brake” is a low budget cap. Of course, it allowed to keep spending at a certain level to optimize profitability. However, since the campaigns did not work 24/7, they could not deliver their best.

We decided to double the budget cap to let campaigns work freely.

In the chart, you can see how not only the spending but also sales have increased with lifting the budget cap.

Sales Increase With With Lifting The Budget Cap

 

And the profit has reached a record level for this account.

The Profit Has Reached a Record Level

 

Conclusion: in the long run, budget constraints can lead to lower sales and profits. If your campaigns are making profit, then you are probably better off without a fixed budget. While it protects from overspending, it limits the success of profitable campaigns.

 

Outcomes

Manipulations with the budget cap helped boost Net Profit to reach a record point of $34,386.

 

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