Social Snowball: Affiliate Marketing Shopify App Takes Off
Noah Tucker created a successful Shopify app but he’s not a developer. He was involved in ecommerce and was sick of the affiliate marketing software that was available for Shopify, so he decided to make his own.
Social Snowball would eventually become a streamlined affiliate control center that would even allow merchants to let their customers be an affiliate right after they bought a product. But that didn’t happen right away.
First, Noah hired a developer agency who promised a minimal viable product (MVP) would take three months to build. He dreamed of a finished product, recurring revenue and just focusing on marketing as the customers piled in.
Um, yeah that didn’t happen.
After 15 months Noah had an app with bugs that didn’t work. He fired the agency and hired a senior developer that used to work at Yahoo. Two weeks later the app was working and could be submitted to the Shopify app store.
Noah then ran ads and it became an instant success! Just kidding.
The product couldn’t really compete in its MVP state and the next 18 months were ad spend that didn’t work, more bad developers as the senior dev had moved on and slowly burning through the $150k he had raised from angel investors and then $50-70k of his own money.
But then it started to work. As customers joined they would mention a feature that they would like, so Noah would rush to have his team build it into the product and that won customers over.
Social Snowball focuses on frictionless referrals and making influencer marketing simple.
Noah also partnered with ad agencies, which gave him leverage as they worked with multiple brands.
Then came the case studies.
Take for example Outway Socks. They thought they could onboard their first 1,000 affiliates in a week. It took 24 hours. The brand now generates 9% of its gross merchandise value with Social Snowball at a 5x ROI.
The team has nine people and they’re serving 1,500 merchants. At a price of $100-$500 per month Social Snowball’s revenue is between $1.8 (ignoring the 3% commission on sales) to $9 million per year and growing.
And it’s growing quick. On the June 29 Ecom Gold pod Noah mentioned they had 1,400 brands and in a post from Aug 28 he mentioned they are up to 1,500 so they’re adding 50 brands, or $60-300k in annual revenue, per month.
A few key lessons and thoughts from Noah’s journey so far:
Focus on product
It should be around $50k to develop a very lean MVP Shopify app
Referrals were 0.25% of a brand's business before joining and rose to 4% after
Once you hit $1 million on the Shopify store they take 15%
Micro influencers are becoming more important
Some brands are having success with giving content to their influencers and having them create their own related brand pages on Tik Tok and posting daily
Some brands are approaching a million affiliates as their customers join the program
Sources:
Our Future podcast (starting 15:40)
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There’s no Morning Brew for the UK, which sold for $75 million (although the UK is about 6x smaller than the U.S. population wise)
Business Success Stories of the Week
Fashion Nova is rumored to be doing more than $1 billion in annual sales with >30% EBITDA margins
ConvertKit (email marketing platform) hits $40 million+ in annual rev
Brett at Design Joy (solopreneur design firm) YTD rev hit $1.6 million
Creatine gummies sold $1 million in the past 54 days
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Dumpster rentals spend $345 in Google ads to generate $11k in rev (interesting side note, their truck cost $200k)
Brez (cannabis drink) is already at $350k per month run rate (Ecom Gold pod)
The robots are here, also love how they note the accomplishment, team size and dev time in video text