From 100K€ monthly revenue to 1MIO€: What eCommerce brands need to scale up

When starting and growing an eCommerce business, business owners usually have one big goal: hitting 1 Mio € monthly revenue with one brand.

After creating, researching, analyzing, and seeing multiple businesses scale from 50 or 100K € to 7-figures monthly revenues, we found common points they shared that fueled the growth.

In this comprehensive, in-depth article, we present to you, the eCommerce founder or marketer, the 11 ingredients necessary for a successful recipe – how an eCommerce brand can hit 1 Mio € monthly revenue and scale even higher.

Ready? Let’s go 🚀

#1 Product-market fit

It all starts with the product you are selling. Not the brand, the product. 

Having a product-market fit that shows that you can profitably sell the product via your eCommerce store to a broader range of customers is a must. 

The product should have a great unique-selling proposition, benefits and solves a problem. 

Ideally, the product should also have retention options to boost retention from the same product or similar product inside the product category. 

If your brand doesn’t have this #1 checked, you will have many problems on your scaling journey, although you might have all others covered. 

Remember: great marketing can’t solve a lousy product.

 

#2 Clear KPIs and reporting

Financial key-performance indicators will make or break an eCommerce business when scaling to 7-figure monthly revenue. 

That’s why it’s crucial to dive deep into your calculation to understand your cost structure, pricing tactics, targets for marketing, and more.

When you have this in place and know the numbers, it’s crucial to decide on your HERO KPIs that you and your team will follow with your ECOM brand.

Here are the TOP 10 main metrics that matter for eCommerce business we follow for our partners:

1. Marketing efficiency ratio (MER) // Blended ROAS
2. Revenue and Profit
3. Total Marketing investment vs. ratio per channel
4. Return on Ad Spend (ROAS)
5. Cost per order (CPO)
6. New customer acquisition cost (NCPA)
7. % returning vs. New customers
8. Average Order Value (AOV)
9. Conversion rate (CR) 
10. Lifetime value (LTV)

So, now you know your numbers, you know about the main KPIs you will follow… 

The final step is to make it accessible as much as possible so you can track the metrics in real time and make marketing and business decisions quickly.

You can create a custom dashboard in Google Sheets or Looker Studio with Supermetrics, manually insert the data to your table, or use a tool like Triple Whale, BeProfit, Lifetimely, or other alternatives.

#3 Growth-oriented business model

The next point is to develop a growth-oriented business model that goes beyond an effective acquisition of new customers with a few direct-response products. 

With this crucial element of the 7-figure monthly revenue-generating business, you need to think about the following: 

• Funnels that you will use for acquiring new customers, and how can you diversify the mix
• Which channels will fuel your acquisition of new customers
• Subscriptions to boost your LTV
• How will you build a retention flow and offers for the returning customers
• How can you build a community behind the brand
• Integration of Influencers, celebrities, and creators into your marketing mix
• Social proof, community building, word of mouth, and branding
• How will you launch new products to fuel the retention of returning customers and expand your potential customer pool for acquisition
• Cashflow issues when scaling your revenue, production, logistics, team, markets, and development of new products
• Expansion of your business to new markets and maybe even go with international targeting to grow faster

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We all know that every industry is different. There is no one size fits all approach. So make sure to research and analyze the companies in your niche that are doing it on a large scale using above-mentioned areas. Based on that, create a roadmap for your business.

In the upcoming point, we will learn more about the mentioned areas. Let’s go to #4, the most significant factor in faster growth.

#4 Scalable acquisition channels 

The purpose of the acquisition channel is to attract and convert new customers for the brand, so it can constantly grow its customer database, at best, doing this with breakeven or even profitably if you are an all-star.

With acquisition channels, you will encounter these limitations that might slow your growth.

Efficiency

What is the ratio between the cost of acquiring a customer vs. your average order value or LTV? The purpose is to analyze if and how much you are profitable on the sale.

Feedback loop

How fast can you see results? Speed of feedback loop, iterations, and execution is crucial when scaling.

Creative requirements

How hungry is the channel for new (native) creatives? Creative fatigue is real; different channels have different requirements regarding the quantity and quality; playing native with your ad creatives – all mentioned can be limitations or a clear sight for high priority to building up the creatives systems behind it. 

Scalability

How fast and how much can you scale on the channel? Meaning if you find something that works, how fast you can start scaling, and how much money you can invest while still producing efficient results. 

I believe in the power of the BIG 3 for eCommerce brands to fuel growth and get to 7-figure monthly revenue. 

Meta (1) is, in the majority of cases, our most important channel when it comes to acquisition, followed by the addition of Google (2), and last but not least, we have seen lately great scalability and a spark for creativity with TikTok (3).

#5 Advanced retention tactic 

We covered the acquisition part in the #4 ingredient to scale, but your journey will be much easier with retention.

The goal is to make retention easy for your returning customers.

You can do it with the following:

• Subscriptions for specific products, bundles, or services
• Email marketing flows and newsletters
• SMS marketing, and other messaging platforms, like Viber, Whatsapp, and other local alternatives. 
• Push notifications for some sales, exclusive offers, or product launches
• Building an App – for Shopify businesses, Tapcart could be a great option
• Loyalty, ambassadors, and referral programs 
• Building a VIP community for your most loyal customers
• Launching new products, bundles, and funnels for returning customers
• Post-purchase activities like putting catalogs, product samples, or discount codes in your packages or some
• Offering excellent customer service, easy returns, and talking with customers about their needs and problems
• Organizing live events for your customers because people want to know who stands behind the brand

Building all or some of these will increase your profitability, retention, and customer satisfaction.

When scaling, it’s essential not only to have these built but to constantly look for ways to upgrade them and make them better and easier for your customers to buy again and to continue the relationship with your brand. 

#6 Data-driven creative system

We mentioned creative fatigue in the scalable acquisition section and how you need to produce a lot of creatives to fuel different platforms, however there is more to it when building a system for creatives.

It’s not just about the quantity but the quality, different sources, creative strategy, research, iterations, reporting, and feedback loop.

Let’s start with different sources to produce creatives; we divide them into four different buckets that you can develop:

• Organized shooting for studio or lifestyle creatives
• Creators and Influencers that produce UGC
• Employee-generated content by the brand’s team
• Customers that produce UGC

When you have all these creatives in place and are producing a lot of iterations with your video editors, graphic designers, and AI tools, it’s important to build up a data-driven process on the backend.

A great data-driven creative system consists of:

• Excellent team communication flow with a media buyer, growth strategist, editors, creative strategist, creators, and production team
• Different sources to produce creatives that perform fast and cost-efficiently
• Playing native on each platform
• Constantly researching new ideas
• Prioritization of concepts 
• Clear naming and reporting infrastructure
• Learning from the winners and losers
• Testing and scaling structures for each platform
• Producing fast iterations from winners
• Constantly developing process

Put a lot of your focus here because creatives become even more crucial for outstanding performance as the platforms change and upgrade with all the AI technologies.

#7 High-converting funnels 

Magical #7 is developing, testing, iterating, and finding the high-converting formula for your funnel.

Remember the famous quote: 

“You are one funnel away.”

There is a lot of truth there, but we want to share some background to understand it better.

It all starts with understanding the customer and customer journey, so understanding who, what, why, and how the person buys is critical.

Based on that, you will be able to define and create the right funnel(s) with:

• Right targeting across the ad platform
• Addressing the right hooks to catch the attention
• Create the effective creative approach
• Hit the right angles with your copy
• Guide a customer across your website
• Build social proof and urgency for the purchase
• Tackle the objections of the customers
• Close the first sale with an appealing product and offer
• Create a backend structure to transform a first-time customer into a returning customer and a promoter of your brand

Remember, this is not a one-time thing; develop it over time, do iterations, and create more assets for scaling.

#8 Cashflow

There is not enough said about the need for cash flow in the business for fast growth.

When scaling your eCommerce brand, you can face the following four main challenges:

(1) Financing your marketing

(2) Financing production of your products and logistics

(3) Financing new product development

(4) Financing market expansion

We specialize in growth marketing, but here are some practical tips that might help you tackle them:

• Analyze your costs to identify the areas and identify companies with the most significant shares within your costs
• Determine the liquidity KPIs and create reports to analyze the status of your business
• Follow profitability metrics when scaling your budgets
• Re-negotiate the payment terms with your production partner
• Re-negotiate the payment terms with payment providers, apps, and platforms you use
• Optimize pricing of your products and packaging when quantities get higher
• Re-negotiate the pricing with your logistic partners
• Re-negotiate the credit line and longer payment terms from the paid marketing platforms 
• Look for other partners and get the deal to negotiate with the existing partners or to give them part of the business
• Look for companies that offer growth capital
• Get additional investors
• Make a deal for performance-based pricing with your scaling partner

Even though there are other ways to resolve these challenges, these are some effective ones that we saw and played a significant role for our partners.

#9 Market size & Expansion

Number #9 is connected to the potential audience to which you can sell your products. 

This is especially relevant if you come from a smaller market or are selling your products to a specific niche of customers.

Businesses hit the sealing, and they can effectively grow by acquiring new customers; their only revenue growth is from returning customers.

Although they are super profitable, there is no clear patch on how to 2x, 5x, or 10x the business.

Our top recommendations for solving this issue are:

Launching new products

to open up a new audience group. Here we are talking about launching new products in the same new product category. It can still be under the same brand but also addresses a different audience.  

Expanding to new channels

like TikTok, YouTube, Pinterest, affiliate, native, mobile app, and more on the digital side. Also, consider expanding your brand and products beyond the DTC as a channel. Look into popular local marketplaces, Amazon, selling B2B retailers, or even open a local store, as Gymshark did.

Opening new market(s)

to reach new audiences and boost growth. We are seeing great success with all the brands we worked with when they expanded their business to other markets.

The main factors of a successful market expansion are research, go-to-market strategy, product range and pricing, budgeting, local specifics, logistics, marketing, and creating social proof.

You can do all three or just one or two of them to grow your business. 

We recommend that you think about the size of the market, what’s your potential, and how you will expand your customer size, short, mid, and mid and long-term.

Ready for the next one? 

We’ve got two valuable ones left.

#10 Community & Social proof

When analyzing the most successful brands and being part of a journey for brands that grew from 5-figure monthly revenues to 25, 40, and 50 Mio € yearly revenue, we got a great realization.

They all had a community behind them. 

The community of customers and creators formed a tribe that admired the products, recommended them, and participated in brand development.

It could be on social media channels, email lists, showing up at live events, filling up surveys, or supporting the founder’s story and vision of the brand.

Remember this one; it’s crucial because it will build trust, fuel growth, and form a brand.

#11 Strong team

We saved the best for last; the team is the one that produces results. 

Combining the internal and external teams (partners, agencies, software, payment providers, mentors, etc.) and their process, experience, speed, and performance will guide your brand to high targets and growth.

Those are the 11 most essential ingredients we see in practice. 

You need to master them to scale your eCommerce store to 1,000,000 € monthly revenue and continue scaling. 

We know it’s a lot, but start with one and go from there on. 

The journey of a successful eCommerce brand is a learning, testing, adapting, and fast-moving process. So keep learning, networking, and scaling when there is an opportunity.

I also prepared a checklist with the 23 most common practical mistakes that eCommerce brands make that jeopardize their growth and actionable growth tips on how to solve them. 

If you don’t have them yet, get them today – HERE. 

If you have any questions regarding a specific topic or want to tackle some of the challenges and opportunities you face in your business, our team of Scalers is there for support.