Hi there,
Thanks for getting in touch. Happy to give you some initial thoughts and guidance on your luxury retail strategy. I'll try to address your questions around budget and platforms and give you a few other things to think about as well.
We'll need to look at your budget...
First off, with luxury retail, especially when you're dealing with items ranging from $20 socks to dresses costing $10k-$19k, you've got a pretty wide spectrum. Your budget needs to reflect that. The minimum daily budget really depends on how quickly you want to gather data and optimise your campaigns. Skimping too much at the start can actually cost you more in the long run as it takes longer to learn what works.
I remember one campaign we ran for a client, a luxury brand launch, where we aimed for 10 million views. To achieve this, we needed a significant daily budget to ensure the ads were seen by a large enough audience. If you're testing 16+ creatives, as you mentioned, you could benefit from a similar approach. I'd suggest aiming for at least £30-£40 per ad set as a starting point. Possibly more, depending on your target audience and location. The more data you feed into the pixel early on, the quicker you'll find what works and you won't waste time on bad performing campaigns.
Consider that with high-value items, the sales cycle is often longer. People aren't impulsively buying $10k dresses. They're doing their research, comparing options, and considering the investment. So, your ads need to be in front of them consistently over a period of time. A decent daily budget allows for that sustained presence.
I'd say you need to consider focusing on a single platform
Now, about platforms: Meta (Facebook/Instagram) versus TikTok. Both have their merits, but for luxury retail, I'd lean towards Meta to begin with. It's simply got more mature targeting options, especially for high-end goods. You can target based on income, interests, purchase behaviour, and even specific luxury brands. This level of granularity is invaluable when you're trying to reach a discerning audience.
Plus, you've already got the pixel set up, which is a great start. This allows you to retarget website visitors, ad engagers, and people who've shown interest in your products. Retargeting is super important for luxury goods, as it keeps your brand top-of-mind and nudges potential customers closer to a purchase.
TikTok can work, especially if you're targeting a younger demographic or tapping into trends. We have seen good results for Luxury brands on TikTok. It's worth testing down the line, but I'd advise mastering Meta first. Get your campaigns dialed in, build up your audiences, and then expand to TikTok once you've got a solid foundation.
You probably should improve and refine your creatives...
You mentioned you're starting with posts that have the best engagement. This is a decent starting point but remember that engagement doesn't always translate into sales. You need to consider whether your creatives are persuasive enough to drive sales.
Think about professional-looking product photography. Luxury items need to be shown in the best possible light. Lifestyle shots that showcase the product in aspirational settings can also work well. The text in your ads also needs to be persuasive. Highlight the unique selling points of your products, focus on the craftsmanship, the quality of the materials, and the story behind the brand.
I remember when we worked with a client selling maps and navigation products online, achieving an 8x return on ad spend. High-quality visuals and compelling ad copy were crucial to this success.
You'll need to test out a few retargeting ads
These work really well to bring back people who've already shown interest in your products. Think about showing them the products they viewed on your website, offering them a discount or free shipping, or highlighting customer testimonials.
For luxury retail, retargeting is incredibly effective. People might not be ready to buy right away, but by staying in front of them with relevant ads, you can nurture them over time and turn them into customers.
You will want to look at building custom audiences as well
Besides retargeting, look at building custom audiences based on your existing customer data, website visitors, and ad engagers. You can then use these audiences to create lookalike audiences, which are people who share similar characteristics with your best customers.
I remember working with a client on B2B leads for high-ticket industrial products. By creating lookalike audiences based on their existing customer data, we were able to significantly expand their reach to potential customers with similar characteristics.
I've detailed my main recommendations for you below:
| Recommendation | Action | Reasoning |
|---|---|---|
| Budget Allocation | Start with a daily budget of at least £30-£40 per ad set. | Ensures sufficient data collection for effective optimisation and sustained presence. |
| Platform Focus | Prioritise Meta (Facebook/Instagram) initially. | Offers more mature targeting options for luxury goods and established retargeting capabilities. |
| Creative Refinement | Invest in high-quality product photography and persuasive ad copy. | Enhances the perceived value of luxury items and resonates with discerning customers. |
| Retargeting Implementation | Implement retargeting campaigns to re-engage website visitors and ad engagers. | Keeps your brand top-of-mind and nurtures potential customers towards a purchase. |
| Audience Building | Build custom audiences and create lookalike audiences based on customer data. | Expands your reach to people who share similar characteristics with your best customers. |
I hope that was helpful. I know it's alot to take in.
Running a luxury retail store online can be a bit of a challenge, and the advertising landscape is always changing, which makes things difficult. It sounds like you're doing the right things to get started but if you'd like a hand making sure you've thought of everything then feel free to book in a free consultation!
Regards,
Team @ Lukas Holschuh
