CHALLENGE

"We had a very easy beginning in 1999," recalls Libida Co-Founder & CEO Dr. Petra Zebroff. "We raised VC money in 20 days and started off. But then, within six months we got notice we weren't getting the $11 million next round funding we were expecting."

Suddenly, the site which had been conceived in the classic 3C formation (content, commerce and community) had to break even immediately. Zebroff scaled back dramatically, deciding to focus entirely on ecommerce.

Aside from that drama, there were only two problems:

First, no significant mainstream sites would run ads for Libida. In fact, the site's Yahoo store test was repeatedly shut down without warning. And, affiliate networks declined to allow the site join. Adult sites would take ads, but they sent the wrong traffic.

"There's mainstream, there's adult and there's this sex-positive world we fit into in the middle. Even though we're considered adult by mainstream sites, it's very different from adult."

Biggest difference? Libida's hoped-for customers were mainstream women ages 25-55 who were almost certainly "uncomfortable" with porn sites.

Second, Zebroff had to cut the marketing leadership position from her original budget, which meant she was in charge of marketing personally. And she didn't know diddly about marketing. "I was the idea person. I had a Doctorate in Human Sexuality but no business experience."

Luckily a board member had some advice, "Test, test, test. Test everything."

CAMPAIGN

First, you drive traffic without paying for it upfront …

Turned down by mainstream sites and affiliate networks, Libida decided to try to launch an affiliate network on their own. They knew they had to work harder, to be the most affiliate-friendly site around to make up for any inconvenience the lack of a network connection might mean. Tactics included:

#1. Loads of content

Zebroff wrote what felt like mountains of articles, Q&As, product reviews and columns for potential affiliates to feature as content from a trusted expert on their sites. Plus, as soon as budget allowed, she hired two more female sexologist writers to keep affiliates topped up with loads of fresh content.

(Note: in our experience, merchants who keep teams of writers on the team to serve affiliate content needs tend to have extremely high-performing results.)

#2. Advance warning of specials and news

Zebroff sent affiliates a monthly newsletter (Link to sample below) with info on upcoming specials, sales and new product launches so affiliates would have at least 30 days to prep their marketing campaigns for the next month.

#3. Test a more mainstream microsite

The team also tried launching a secondary site, PassionBlush.com, which featured the more modest items from Libida's inventory. They hoped that affiliates that weren't quite comfortable with the main site might consider working with the other site. Then, the marketing team worked on the back end to graduate incoming customers to the larger site's offerings when appropriate.

Next, you focus on converting that traffic to buyers …

Zebroff's team used a six-pronged approach to converting as much of the incoming traffic as possible into buyers, such as:

A. Start a customer council

As soon as the site launched, the registration process began to ask visitors if they'd like to join the advisory council. "Our goal was to get 70-100 people."

Then whenever the team had tough decisions to make about everything from site design to product lines, they ran a council survey. "There was usually no incentive to join or to answer the surveys. Sometimes if it was a particularly long questionnaire we might give them a $5 coupon to use on the site."

B. Add more reassuring content

Zebroff decided to play to her strengths on the site and focus on creating content throughout that educated the shopper, and made the shopping experience feel safe and reassuring.

Example article headlines posted prominently on the site:

"Why Some Sex Toys Fail:
Ever regret shelling out your hard earned cash for a sex toy?"

"Need help choosing a toy? Try our Decision Maker."

C. Encourage honest product reviews

Zebroff knew that women trust other women more than anyone else. So she had the Web team build in a product review function with the very first site launch. Then, she encouraged as many reviews as possible by permanently adding the following offer to the review section on every merchandise page, "Review this product and get 25% off your next purchase!"

She also had a printed postcard created to run as an insert into every fulfillment package sent out to buyers, repeating that review discount offer (link to sample below.)

The actual review form itself contained far longer instructions than we've ever seen on another site. (Link to sample below.) Reviewers were exhorted to be truly honest in their reviews and were given topics to consider including in their review.

D. Use an in-house photographer

"Great photographs can make or break product sales," notes Zebroff. When she reviewed the photos many manufacturers provided for their sex toys, she worried these would not attract a mainstream female audience. The typical manufacturer photos were often far more likely to be erotic to men than friendly and reassuring for women.

"I like images of women with an expression of positive emotion, her face might be surprised or a little fun [versus overtly sexual]. It's something you might see in a cosmetic ad in a mainstream magazine."

She also agrees with every female marketing expert we've ever interviewed that the color pink should be used in moderation. "You need to be feminine but not pink. Purple does really well."

E. Flaunt your privacy policy

"It was my mother's idea," admits Zebroff. Instead of "Libida" the actual company name was Bedrock Inc. And that's what showed up on your email receipt, on your fulfillment packaging and on your credit card bill.

The site actively promoted this discretion in many places, including the home page, the first page of the shopping cart, and the first page of the reassuringly-worded privacy policy. Plus, the search marketing team tested the term 'Discreet shipping' in paid search ad copy.

F. Constantly test new free-gift-with-order offers

Zebroff set a schedule to test out a new gift-with-order offer every month. That way she'd learn what worked best and entertain returning customers.

Last, turn buyers into loyal, ongoing fans …

This is the idea we think more ecommerce sites should test -- Zebroff never used free shipping offers to improve ecommerce conversions. Why?

She figured it was so hard to get that initial traffic to the site that she wanted to gather as many email opt-ins as possible from it. So, she reserved the free shipping offer as an opt-in incentive. In fact, the incentive was "free shipping for life."

The back-end systems even tied together so if an email subscriber unsubscribed, their free shipping was then disabled.

Email campaigns were sent to the opt-in list every two-three weeks. Frequency depended on whether it was a "cold weather month" or not (with more frequent emails during winter.)

The team alternated between an email newsletter format containing four-five articles plus the free-gift-with-order of the month, and a shorter format featuring just one product and a single must-read article hotlink. (Link to samples below -- note, the email content is somewhat adult in nature.)

Delivery was obviously a gargantuan problem. The team relied on a third-party email service provider who could help keep them on the good side of major ISPs. Plus, more filter-able words were contained in images rather than text.

However, subject lines were a problem. Just as with other ecommerce sites, the team found they could not use terms such as 'Free" "Sale" or "Discount" without being heavily filtered. Plus, for obvious reasons, they also couldn’t use terms that precisely described most of their SKUs.

So, the team A/B tested like crazy to find ways around this problem. The goal -- subject lines that were short, interesting and not at all misleading.



RESULTS
"Testing is what's kept us alive without any more investment money at all," says Zebroff proudly. In fact, the site’s done rather better than stay alive –- it’s thriving and profitable.

From the very launch, the target demographic (when they were able to find the site) proved unexpectedly enthusiastic. Instead of 100, 500 eager visitors joined the site’s shopper council in just a couple of months. They’ve proven unusually loyal –- Zebroff took down the initial recruitment campaign in late 2000 and has not run another high profile one since. Yet, the council is still strong enough to provide high response rates to surveys.

Affiliates were equally enthusiastic. The site signed up almost 700 affiliates despite not being on a network for nearly six years. (CJ has just now agreed, at long last, to take Libida on.) The best affiliates are those that focus on content as well, educating, entertaining and informing the same demographic of women. Natural partners include lingerie shops online.

The ‘Discreet shipping’ promo point has proven so powerful that nearly all of Libida’s paid search marketing ads now feature the phrase as part of their limited copy. Search marketing clicks tend to hover just below 2%, but conversion rates vary sharply depending on whether the offer is general “Sex Toys for Women” or specific “Pocket Rocket Vibrator.” General ad clicks convert at just under 1% while specific ads can convert at just under 3%.

The site now features user reviews of most products. The merchandise team discontinue products that get consistently bad ratings. However, they allow negative reviews for currently sold stock to stay live in the policy of honesty is best.

18% of shoppers who post a product review wind up redeeming their 25% discount coupon.

As for email marketing, typical campaigns to the opt-in list get a 26% measured open rate, a 9% overall click rate and 2% of clicks convert.

The highest performing subject lines often feature the word “Easy.” ("But not in the way that men use the word," Zebroff notes.) We’ve heard this from other sites serving women.

Which proves that what women respond to most is convenience, rather than overt sexuality.

Useful links related to this article:

Creative samples of Libida's campaigns -- we've noted which ones have slightly explicit content:
http://www.marketingsherpa.com/cs/libida/study.html

6S Marketing -- Agency that handles Libida's paid search ad campaigns:
http://www.6smarketing.com

iPost -- Email service provider Libida relies on to get email out past filters
http://www.ipost.com

Libida
http://www.libida.com