Would You Gamble $18K In Hopes of Getting A Viral Video?

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If you have not heard of Dr. Squatch (they had a Super Bowl Commercial this past year), they manufacturer all-natural soap and personal care products marketed towards men. The company was started by Jack Haldrup in 2013. At the time, he was manufacturing the soap out of his house.

In 2017/2018, Dr. Squatch was doing about $3M in yearly revenue. Jack reached out to a video production company in San Diego to help him create a video for Dr. Squatch.

Today, that video has been watched over 115M times. And in 2020, Dr. Squatch’s revenue grew to over $100M. The video cost Jack $18K. Seems like a pretty good investment right? With hindsight, of course, it seems like a good gamble, however going viral is not guaranteed no matter how good the video is.

Dr. Squatch’s Revenue Today

Over the past 16 days, on their website, Dr. Squatch has received 237,000 orders. That is an average of just under 15,000 orders per day.

Their top-selling item on their website is their Pine Tar Soap.

This item retails for $7. If you order just one bar of Soap, Dr. Sqautch charges $3 for shipping. If you order more than one bar but your order size is still below $40, Dr. Sqautch charges $6-$7 for shipping. 

Dr. Sqautch offers bundles, and pre and post-purchase addons to try to increase your cart size. My best guess is that Dr. Squatch’s average order size through their website is about $20.

That means daily, Dr. Squatch is generating about $300K. Nearly $9M monthly, and nearly $110M yearly.

In early 2021, Jack mentioned that Amazon was about 15% of his overall business and his website was the other 85%.

I estimate that Dr. Squatch will do about $130M in total revenue this year, with $20M of this coming from Amazon.

Subscription Business

Dr. Squatch offers a subscription for their soap and other products. 30% of their overall website business comes from subscriptions. A great way to easily increase the life time value of a customer.

Video Video Video

Video has been an important part of the growth strategy for Dr. Squatch. It started with their viral video back in 2018 and continues to today. The vast majority of their Facebook ads are video. On YouTube, they have nearly 300M views on their videos. On their TikTok, their videos have nearly 500K likes with 59.8K followers.

Search

Here are the top 5 search terms for Dr. Squatch:

  1. dr squatch
  2. dr. squatch
  3. squatch soap
  4. dr squatch soap
  5. dr.squatch

Nearly all of their top 20 keywords include their brand name. This does not come as a surprise since they put so much effort into their branding and videos. People see their videos on Youtube, or Facebook, or TikTok, or TV and they go search for the brand name. 

In the past 2.5 years the search term “dr squatch” went from being searched on average 18,000 times a month to now over 500,000 times a month. This appears to be a continual uptrend that most likely will continue to grow:

Super Bowl Ad

The advertising dream, to have Super Bowl Ad. In 2021, Dr. Squatch had a last-second opportunity to purchase a Super Bowl ad. Due to COVID, a lot of advertisers were unsure of what the performance of Superbowl ads would be this year.

Sporting News reports that the average cost of a 30-second commercial in the 2021 Super Bowl was about $5.5M. My guess is the Dr. Squatch got a last-second deal and paid $1m-$2M for their spot. Unlike, other advertisers, Dr. Squatch did not have to spend millions to produce their commercial. They could take the content they were already making for Youtube and format that for a 30-second commercial.

In an interview with Shopify, Dr. Squatch reported that they saw 100% sales growth the day it aired. The week after the commercial they saw about a 15-20% increase in sales.

Based on their current daily sales volume, I estimate they saw about $500,000 to $600,000 in additional sales from their commercial. And while this is less than what I estimate they paid for the spot, most likely they turned a lot of those customers into subscribers or repeat purchasers. And they most likely introduced their brand to millions of people that had not heard of them.

Dr. Squatch viewed the commercial as a big success for them.

Post Purchase Survey

After you check out at Dr. Squatch you will be fed a survey asking you what drove you to their site to make a purchase. Through this survey, they found that the majority of people who made purchases cited “Youtube” as their reason for coming to the site and making a purchase. However, they found without this survey they were not able to attribute the sales back to Youtube.

For only $3 per month, you can add a post-purchase survey, like Grape Vine, to your Shopify store.

Learn More

Here is a great podcast to learn more about Jack Haldrup and Dr. Squatch: https://www.practicalecommerce.com/dr-squatch-a-mens-soap-brand-scales-to-100-million

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