
Case study #5 - Baptism gift set does ~$14k/mo profit 7 months after launch
Link to Amazon store:
https://www.amazon.com/stores/HighmarkCollective/page/CCD0D505-ACBB-4A56-A2D5-E8F52BE77C7B
Christian themed gifts, with the best selling SKU being a baptism gift set.
* $51k revenue/mo
* $16k on manufacturing/shipping (COGS)
* $12k FBA fees
* $7.7k Amazon referral fees (15%)
* $1.2k PPC adspend
* PROFIT - $14k (~27% margin)
They have two primary products -
* A "Baptism gift set" (gift given for a Baptism) - 65% of sales
* A "Bible verse jar" (jar filled with verses from the bible for different moods/inspirations) - 19% of sales
* Some other smaller products as well
How do they reach such a high margin with these ? What's the strategy ?
"Baptism gift set":
* A bundle of products - bought together for the Baptism occasion
* It being strictly a gift prompts people to spend more - given that it's a nice and thoughtful set (preferable to the competitors) - even if the price is higher (it's a $37 set - adding just $5 over the competition is already an increase 13% to the profit margin)
* It's not a commodity ! But rather a 1-of-1 sort of product (competitors are not strictly comparable to one another, it all depends on customer's preference and willingness to spend)
* 29% profit margin
"Bible verse jar":
* A design-based product - cards cost close-to-nothing to produce but people are willing to pay more for a good design
* A design-based niche often leads to high margins
* The other products in the niche charge lower prices (some get more sales) - but this one still seems to be getting a decent amount of sales at the higher price point ($19)
* 19% profit margin
How much does it cost to start a similar business ?
* "Baptism gift set" - ~$1200 for 100 MOQ, then $1k for a month of ads (on Amazon) - depends on which keywords you target
* "Bible verse jar" - ~$700 for 100 MOQ, then $1200 for a month of ads (on Amazon) - depends on which keywords you target
How I estimated the figures:
* Revenue = Amazon's "X+ bought in past month" for each ASIN, aggregated
* COGS = founders' own admission - they were on Shark Tank Vietnam
* Adspend = price-per-click * search-volume * estimated-CTR, aggregated for all the search terms they bid for
Sources: Keepa, Similarweb, Jungle Scout, Meta/Google ad library, and Alibaba for COGS estimation