WashClub - 173tech

Marketing Analytics

Reduced cost per conversion by 72% from $122 to $34

Objective

Centralise and optimise advertising spend to maximise efficiency and ROI.

Obstacle

Unpicking complex transactional data to uncover and target high-LTV (lifetime value) customers.

Outcome

Reduced Cost Per Conversion by 72%, from $122 to $34, while improving customer lifetime value.

Background

Washclub is a rapidly growing subscription laundry and dry-cleaning business. Over time, their customer acquisition costs increased sharply, while advertising ROI declined.

To sustain growth without inflating budgets, Washclub needed a data-driven strategy that could reveal which customers were truly driving long-term value, and ensure marketing spend was directed toward attracting more of them.

Challenges

Escalating Acquisition Costs: One of the biggest challenges Washclub faced was the rising cost of acquiring new customers. The increasing competition in digital advertising meant that their cost per acquisition (CPA) was growing, reducing overall return on investment (ROI) and straining their marketing budget. With higher costs eating into profitability, it became clear that a more efficient approach was needed to maximise returns without continuously increasing ad spend.

Algorithm Limitations: Despite setting up ad campaigns with precise targeting and optimised creatives, Washclub found that advertising platforms were failing to deliver the kind of high-value customers that would stay loyal over the long term. The ad algorithms primarily focused on short-term conversions rather than identifying users with strong lifetime value (LTV). This misalignment meant that marketing dollars were often spent inefficiently.

Solution

Account Analysis: A detailed audit of Washclub’s advertising account revealed performance patterns across channels, locations, and landing pages. These insights helped pinpoint which campaign elements had historically delivered the best results.

LTV Predictions: To address these inefficiencies, we leveraged first-party customer data to build a predictive model that identified and flagged long-term, loyal customers. By analysing historical customer behavior, we were able to differentiate between one-time purchasers and those with high retention potential. This data-driven approach provided invaluable insights that helped refocus advertising efforts on attracting customers who would contribute to sustained business growth.

Impact

Escalating Acquisition Costs: Rather than a one-time fix, Washclub implemented an ongoing optimisation loop. New data was analysed in real time to refine audience targeting, creative messaging, and bidding strategies. This ensured campaigns remained effective as market conditions and customer behaviour evolved.

Cost Savings: Through focused targeting and smarter spend allocation, Washclub reduced its cost per conversion by 72% (from $122 to $34) and achieved $62,000 in annual savings. These optimisations delivered stronger, more sustainable ROI, turning marketing into a long-term growth engine.

Lifetime Value: As well as lowering costs, we were able to attract better quality customers, the lifetime value of customers rose by 41.4% in just two months.