They started with $200 and built a $100M+ DTC empire

How do you turn $200 into a multi-million dollar DTC empire?

Check this out…

If you’re a fan of Shark Tank, maybe you’ve seen the 2022 episode with The Woobles:

Husband and wife team (Justine & Adrian) started this DTC beginner crochet kit company in 2020.

They spent $200 on a domain name, bought some yarn…

And after some initial success selling the kits on Etsy…

They fired up some ads and started printing money.

By the time they filmed their Shark Tank episode, The Woobles was on pace to generate $7 million that year, just 2 years after launch.

Fast forward to today, they’ve kept growing like crazy.

You’ll see The Woobles on TV & Connected TV ads like these:

And also on billboards in Times Square:

There’s no public mention of current revenue numbers… 

…But if we do some quick “back of the napkin” math with Google Keyword tool on their brand keyword…

You can see that The Woobles is MUCH bigger now than they were back in March 2022 when they shot that Shark Tank episode: 

(Interesting to see that first spike in traffic, which was when the episode aired in later that year in September 2022)

How did The Woobles go from a $200 investment to a multi-million dollar DTC business?

As they say, “Success leaves clues”

So let’s dig in and find out…

Success Clues: 3 Types of Customer, 3 Stages of Scale

By now you’ve probably heard of Direct Response legend Eugene Schwartz’s “5 Stages of Marketing Awareness”:

• The Unaware Stage: The prospect is not aware of their problem or the solution.

• The Problem-Aware Stage: The prospect knows they have a problem but is unaware of solutions.

• The Solution-Aware Stage: The prospect knows the solution exists but is not familiar with your product.

• The Product-Aware Stage: The prospect knows your product but isn’t sure if it’s the right choice.

• The Most Aware Stage: The prospect knows your product well and just needs to be convinced to take action.

These stages help marketers tailor their messages to meet the prospect where they are in their awareness journey, ultimately guiding them towards making a purchase decision.

Schwartz’s 5 stages of awareness is an incredibly useful framework. 

(and btw if you haven’t checked out Roy Furr’s spin on this, do yourself a favor and watch this: https://youtu.be/3HJRKppt3nw )...

…But it’s always great when someone can SIMPLIFY a framework even further, and show how they actually applied it to grow their business.

That’s what Derek Halpern did in this amazing video:

Derek is co-founder of Truvani, one of the fastest growing natural food brands right now, doing big numbers via DTC and high-end retail.

(Log in to the Funnel of the Week Members Area to see the full breakdown we did on Truvani’s funnel, including some very clever upsell mechanisms they use)

And in the video above he walks through how he & his team launched and scaled Truvani to big numbers.

If you sell anything online, you’ll want to watch the whole video, but specifically here there are 2 frameworks Derek shared that help us understand how Woobles scaled:

Framework #1: 3 Customer Types

Derek Halpern's “3 Customer Types” framework simplifies Stages of Awareness by identifying three distinct types of customers and three corresponding stages of scaling a business:

1. Customer Type #1: Informed Customers: These are people who are already aware of your product category and actively seeking solutions. They know the benefits and are comparing options.

2. Customer Type #2: Afflicted Customers: These individuals are aware they have a problem but may not know about your specific solution. They're actively looking for ways to solve their issue.

3. Customer Type #3: Oblivious Customers: This group isn't aware they have a problem that your product can solve. They're not actively seeking solutions and need to be educated about both the problem and your solution.

Framework #2: 3 Stages of Scale

Derek’s “3 stages of scale” framework shows how each of these customer types are crucial at different stages of a business’ growth: 

1. Stage #1: Early Stage (First Million): Focus on Informed Customers

2. Stage #2: Growth Stage ($1M to $10M): Target Informed and start reaching Afflicted Customers

3. Stage #3: Mass Market Stage ($10M+): Master talking to Oblivious Customers

Let's explore how The Woobles navigated these stages, and how they adapted their marketing approach to reach each customer type as they scaled from a $200 investment to a $100M+ business…

Stage 1: Early Stage - from zero to one million in Sales

You could think of this stage as, starting narrow so that you can go broad, long term. 

How to do that?

The name of the game at this stage is focusing on Customer Type #1: Informed Customers:

People who are already aware of your product category / niche and actively seeking solutions.

And that’s exactly what The Woobles did out of the gate.

But even more crucially was this:

The specific niche - and sub-niche - they chose to target.

First, crochet may seem to be a really small niche market. But is it really?

Let’s use US Google search volume as a rough indicator of market size.

Here is monthly search volume for “crochet” versus another favorite US hobby, golf:

Golf equipment alone is forecasted to top $11 billion per year by 2030.

And while obviously someone who buys crochet supplies isn’t spending nearly as much as someone buying a new set of golf clubs…

A market ¼ the size of golf is not an insignificant market. 

But the Woobles didn’t stop there.

They went significantly narrower:

People who want to learn to crochet.

Here’s the current US search keyword volume for “learn to crochet”

5400 average monthly searches. 

That’s 40x smaller than the crochet niche, by monthly search volume.

But a great place to target a very specific customer and get started.

Check out their first landing page from back in 2020…

Above the fold we have a clear headline specifically targeting this sub niche:

"Crochet Kits for Beginners" + “Learn to Crochet. 100% Guaranteed.”

And look at the images that show how The Woobles makes it easier than ever to crochet

Social proof on the page supports the ease of use /  also:

Log in to reddit and you’ll see countless beginner crochet beginners talking about how the Woobles kits lived up to their promise:

By targeting this very specific customer type out of the gate, the Woobles was able to achieve their first million in sales.

What did they do to get them to the next level?

Enter Scaling Stage #2…

Stage 2: Growth Stage ($1M to $10M)

Next up, The Woobles started testing ways to attract Customer Type #2. 

Afflicted Customers: prospects who are aware they have a problem and actively looking for ways to solve it, but may not know about your specific solution. 

Here The Woobles aimed to broaden their reach beyond that initial relatively small niche of “learn to crochet” people. 

But how would they be able to connect a semi-obscure craft hobby like crochet with a broader audience? 

Enter Woobles co-founder Justine’s personal story:

She had actually first started to crochet during her stressful job at Google, where the hobby had helped her find relaxation and re-build her confidence.

Combining this personal experience with several studies showing the positive mental health benefits of hobbies like crochet, and The Woobles had a new, big slice of market to target:

People looking for improved mental well-being.

Here’s how they framed these benefits on this landing page’s above the fold section:

(see the full funnel breakdown inside the Funnel of the Week Members Area)

Notice the mental health benefits promised here:

• Reduced anxiety & stress

• Improved mood

• Sharpened mind

• Increased self-esteem

• Improved sleep

Scrolling down the page you’ll see these mental health benefits highlighted even more:

And at the bottom of the page you’ll find the scientific article references that back up these claims:

By linking crochet with these benefits, The Woobles was able to hit a much larger market looking for ways to feel better mentally.

(And of course they kept cranking away scaling as much as possible to those Customer Type #1 with the “learn to crochet” messaging as well)

But they weren’t done testing new ways to scale yet…

Stage 3: Mass Market Stage ($10M+)

So how could The Woobles scale even further, beyond Informed and Afflicted customers…

…to Customer Type #3: Oblivious customers?

This group isn't aware they have a problem that your product can solve and they're not actively seeking solutions. So they need to be educated about both the problem and your solution.

This is where The Woobles made the genius move. 

Partnerships with premier brands & franchises. 

Here are just a few…

Minecraft:

Barbie:

Peanuts:

Harry Potter:

(There’s a bunch more too, this is just a snapshot)

Here’s why this is such a genius tactic for scaling to Customer Type #3: Oblivious Customers:

Each of these partnerships opens up an entry point for The Woobles to target an entirely new, untapped, market.

As a frame of reference for audience size that The Woobles is able to tap into with this approach, just look at Harry Potter US monthly keyword search volume:

At 1.8+ million monthly searches, that’s over double the volume of golf.

And with each film/franchise partner launch, The Woobles now has an excuse to advertise to new, large, non-overlapping buckets of potential customers.

And even if The Woobles is taking a loss on the initial sale, due to licensing fees etc…

They have a acquired a buyer to who they can then sell their extensive line of back-end products:

(^^ that’s just a few - there are hundreds of these…)

And when you see the email marketing swipe we have inside the Funnel of the Week Members Area for The Woobles you’ll see just how often they’re launching new products to their list:  

And what’s really crazy about all this…

Is how The Woobles have completely altered the market!

Check this out:

Traffic for “Crochet Kits” went from just a trickle back when the Woobles got started…

To a FLOOD of traffic that’s seeing a 300%+ increase year over year:

…Proof that by starting narrow and scaling the right way, you can take a niche product and turn it into a mass market beast.

Wrapping up…

So there you have it.

From a $200 investment to a multi-million dollar DTC empire, The Woobles exemplify how understanding and targeting different customer types at various stages of business growth can lead to massive success. 

Here are the key takeaways:

• Start Narrow, Go Broad: Initially focus on a very specific niche and informed customers who are actively seeking solutions.

• Leverage Personal Stories: Use authentic personal experiences to connect with afflicted customers by addressing their broader problems.

• Expand Through Strategic Partnerships: Partner with well-known brands to reach oblivious customers, educating them about your product and solution.

• Scale with Smart Marketing: Adapt your messaging and approach as you grow, constantly testing new ways to reach and engage different customer types.

By following these strategies, The Woobles started small and narrow but scaled to a DTC behemoth.

Keep these takeaways in mind as you build your own empire, and remember, success leaves clues.

Get the Full Breakdown

Inside the Funnel of the Week Members Area you can get the full interactive funnel map for the Woobles…

PLUS an hour+ funnel deep dive & breakdown we did with Taner Tozan who has helped scale brands like Organifi & Performance Golf (and many other 9-figure DTC brands) with full-funnel direct response strategic direction & execution. 

Reach out to Taner on Linkedin to pick his brain on your Direct Response / DTC funnels!

More on What’s Inside Funnel of the Week Members Area

Funnel of the Week has been live just one month now, and if you haven’t logged in for a bit, here’s what you’ve been missing:

We continue to stack full funnel breakdowns each and every week inside the Members Area:

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• ecomm funnels

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• (and more)

…And we add a new funnel breakdown & swipes each week.

So if you have a funnel you want us to break down?

(Including all the landing pages, order bumps, upsells, downsells, email/sms followup & more…)

Just let us know and we’ll add it to our Funnel of the Week “next up” list. 

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Here’s a quick Google doc walking through what we at Funnel of the Week has got in store for you, each and every week:

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Have a great week!

The Funnel of the Week Team

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