Step one was to determine how we could scale product acquisition through Google Ads, Meta Ads and TikTok.
Historically, product acquisition had been driven largely by organic channels, either through organic search or social media, with Luxe benefiting from a vast community of millions of followers across Instagram and TikTok.
From a paid acquisition perspective, Google Ads and Meta Ads had been used infrequently with a mix of broad targeting that lacked a clear audience and above all, broken tracking within the sign up process to sell an item sitting on a subdomain.
The budget invested over the last two years was spent blindly across both media channels, leading to the scaling back of media spend as there wasn’t any direction on what worked/didn’t other than movement in the topline product numbers.
There were several changes needed to get the campaigns in a position to start scaling:
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Query Analysis & Data Consolidation
- Ran our custom query analysis script to group all queries together, allowing us to understand where impressions had been served and to gain insight into engagement metrics, since conversion data was unavailable.
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Mapping Stock Data to Media Flow
- Worked with the Luxe operations team to map stock data against media spend trends over the past two years.
- Blended GA4 and Klaviyo data to track movement in sessions, helping estimate the impact of past campaigns on acquisition.
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Establishing Direction for Campaign Restructuring
- Given the level of media spend and the weighting of traffic from paid vs. organic channels, the data provided a rough directional insight rather than statistically significant results, helping shape the restructure.
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Fixing Tracking & Attribution Issues
- Implemented tracking across the subdomain, linking it with GA4 and all ad platforms to ensure accurate conversion attribution.
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Testing & CPA Benchmarking
- Conducted a four-week test period with new campaigns and fully implemented tracking.
- Used the test results to determine where the blended CPA sat across all paid media channels, setting realistic KPIs for future scaling.
Following the test period, we successfully launched new campaign structures, designed to target high-intent audiences:
- General search queries (e.g., “sell my designer bag”)
- Brand-qualified terms (e.g., “sell my Louis Vuitton purse”)
- Non-core product queries to capture demand for smaller items—helping us prioritise core product categories with the highest on-site conversion rates.
As a result, Luxe Collective’s campaigns focused on handbags—their most recognised and highest-converting category—creating a more efficient and profitable acquisition model.
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Step two was to quantify the impact of these product acquisition improvements on sales. This would allow us to determine how much budget to allocate each month, minimising waste while maximising the efficiency of our media spend on the product sales side of the business.
To do this, we needed to analyse the relationship between budget spent on acquiring products (which were subsequently listed on the site) and the overall conversion rate for product sales.
Over a defined 8-week test period, this analysis included:
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Correlation (When we change one factor, does it impact the other?)
- The correlation value was 0.2925, indicating a positive relationship between spending on acquiring products and the percentage of website visitors who completed a purchase (conversion rate). This suggested that as investment in acquiring stock increased, sales efficiency also improved.
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Regression (How do these metrics relate to each other?)
- A slope of 0.000014 showed that increasing spend on product acquisition led to a small but measurable improvement in conversion rate. While the effect was gradual, this confirmed that investment in acquiring stock contributed to better sales efficiency over time.
The effect per unit of spend was small, but its cumulative influence over time confirmed that increasing investment in acquiring stock contributed to improved sales efficiency.
The findings showed that even modest increases in acquisition spend had a tangible effect on conversion rates. This supported continued investment in stock acquisition as a key growth driver.
The results of this analysis showed that over the 8-week test period:
- For every £100 spent on product acquisition campaigns, the conversion rate for product sales increased by ~0.14%.
Moving forward, while there were many additional factors to consider—such as the type of product, lag time between authentication and listing, and organic social content—this analysis provided the team with the confidence to begin steadily scaling spend across both acquisition and product sales.
