Only a few Finnish ecommerce growth rockets can boast a 70 year history and a rural flagship store with tens of thousands of sales articles. Virtasenkauppa is a nice exception. Originally catering to people living in rural areas and specializing in spare parts for cars, their focus today is strongly on ecommerce, which helps them expand their offering, and drive massive growth.
Even though they scale their digital business, they still make sure to put their heart and soul in the work they do, and to make the customer experience fun and personal.
Truly's unprecedented understanding in using data to drive sales makes them stand out from all other partners we've worked with.
Mikko Virtanen, Entrepreneur, Virtasenkauppa.fi
The Virtasenkauppa growth story is very much a story about transformation. Having spent 70 years serving customers in a brick and mortar store, their customer base was increasingly doing their shopping online.
For 2020 Virtasenkauppa set an ambitious goal for transforming their business model from brick and mortar to ecommerce. The OKR objective was to grow their business by 30% (about 1M euros). The challenging goal was coupled with the freedom to dig into their ecommerce funnel and develop and invest in any areas that might bring results.
Courage to experiment
We received a very free mandate to start growth hacking the Virtasenkauppa ecommerce funnel. This was a dramatic change inside the 70 year old company, who was suddenly operating like a seed stage startup.
First we mapped out an extensive list of opportunities to grow their sales. From this list we selected the most promising ones – those ideas formed the base of our testing plan. Weekly growth sprints were kicked off.
In order to measure the impact of each test effectively, we created a calculation model together with the client team. This allowed us to compare the business effectiveness of very different types of tests in real time. Based on this model, we also created the OKR’s for the collaboration. To promote total transparency between all stakeholders, we communicate the status of these OKR’s every week.
Listening to the needs of the end customer
Virtasenkauppa’s clientele consists mainly of do-it-yourself people combined with various types of professionals that are used to working with their hands (over 10% of total clientele). About 22% of sales comes from corporate clients. In general, clients are very price and quality conscious.
The strategic objective for Virtasenkauppa is to reach a household name brand status which requires them to launch new product segments in a systematic and lucrative way. For example, one of their fastest growing segments have been families with children – their toy sales revenue grows at a steady pace.
Their advertising has always had a very tongue in cheek vibe, and Truly has helped make the most of that approach. We’ve done a lot of testing around video ads, and it has become a critical prospecting tool for reaching and converting a completely new customer base.
Black Friday success
Systematically growing an ecommerce store requires seamless coordination of marketing, logistics and customer insight gathering. Tests executed through marketing offered valuable understanding to develop the store offering, and the knowledge gathered helped maximize profits. A good example of this is the success Virtasenkauppa has had during Black Fridays.
Preparations for Black Friday started 6 months before the global sales season. The industry-wide low profit margins make dramatic price slashes difficult. But by analysing the data they had gathered through their ecommerce efforts, and by purchasing products well in advance, they were ready to make an impact. The campaign tactics and content for the whole end of the year sale season were also planned out early. This work was rewarded handsomely when during the 2020 Black Friday order numbers more than tripled compared to last year.
Developing the online store
When the marketing setup started to look like a well oiled machine, it was time to focus on developing the online store. During 2020, the most critical bottlenecks for sales were mapped out and fixed. One of the most impactful of these was the work done for improving the mobile shopping experience.
Because we were able to drive cost effective traffic especially through mobile ads, the mobile shopping experience was a critical success factor. Compared to each desktop sale, we were able to generate more than seven mobile shopping conversions through social ads. The mobile purchase rate improved by over 37% and mobile sales revenue increased by more than 158% (2020 vs 2019).
Another important change we made was implementing a systematic A/B testing regime. These tests were able to uncover many things that had a massive impact on ecommerce conversion levels. Some of the most impactful of these were product recommendations, adopting new purchase methods, and improving discoverability through category level search tools.