Dia&Co Apparel Case Study

Dia & Co’s CEO, Nadia Boujarwah, is no stranger to the challenges of online shopping. Frustrated with constant inconsistency when it came to sizing and fit, she took matters into her own hands by co-founding a size-inclusive brand and marketplace for women just like her.

Seven years later, Dia & Co. has rapidly grown from a direct-to-consumer startup to a powerhouse brand that’s raised $90M from the likes of Sequoia and Union Square Ventures. What’s more, they've surpassed major players like Target, Kohls, Macy’s, and Dillards when it comes to carrying the largest assortment of women’s plus-size apparel. And their commitment to size-inclusivity didn’t stop there.

Despite housing over 200 brands and carrying sizes 10-32, Dia believed there was still a fundamental problem with online shopping: the inability to touch, see, and try. Shoppers are expected to pay upfront for items they are not sure they’ll even like - a problem that doesn’t exist with brick-and-mortar. This risk and uncertainty leads to major drop-offs between “Visit” → “Add to Cart” → “Order Placed”.

Nadia Boujarwah

CEO of Dia & Co

Expecting a shopper to place an order before they’ve had the chance to look at something in person is a really big ask. It creates a lot of purchase-commitment anxiety - especially if they are trying to be conscious with their spending. So it’s no surprise that when they’re faced with so much risk at checkout, they end up abandoning their cart altogether.

This issue with eCommerce isn’t just in the conversion drop-offs, but rather that it’s reflected in some of the most important areas of Dia’s business. Namely, profitability. Ecommerce margins have dwindled significantly since the height of the pandemic - advertising costs are at an all-time high and shoppers are significantly reducing their discretionary spend.

As merchants have been facing increasing challenges in this new eCommerce climate, there’s been a hyper-focus on profitability; cash flow being made a priority, profit margins being maximized, and costs being cut wherever possible.

Dia decided to work with Blackcart to integrate Try Before You Buy (TBYB) technology to drive profitability by capturing more sales and reducing customer acquisition cost.
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TBYB replicates the in-store shopping experience by allowing customers to try items out before making a purchase decision. Blackcart integrated into Dia’s storefront to power the ability for every shopper to checkout with no upfront commitment. Their program details are as follows:

The process is identical to that of in-store shopping, where customers try clothing in a fitting room before checking out. While the risk-free offering is a favorite among shoppers, Dia was particularly interested in Blackcart’s impact on cash flow and overall profitability. Try Before You Buy played a key role in several areas of their business:

Try Before You Buy played a key role in several areas of their business:

+$50k
Monthly Bottom-line Sales

1. Significant increase in monthly bottom line

Blackcart-powered merchants experience a lift in net revenue, purchase conversion rate, and average order value. Eliminating the fear and uncertainty amongst shoppers builds confidence in the products and converts customers that would have otherwise abandoned their cart. TBYB drives incremental net sales with every order by maximizing checkout value and the number of items kept per order - ultimately helping make every purchase count more towards the company’s bottom line.
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Following the integration with Blackcart, Dia saw a 49% increase in net AOV - the average order value after returns. TBYB also increased Dia’s conversion rate by 15%, helping them capture more purchases and mitigating the drop-off between visits and completed orders. In a post-checkout survey asking if TBYB was a deciding factor in the shoppers’ purchase, 94.4% of the 162 respondents answered “Yes”. Today, Try Before You Buy adds an additional $50k to Dia’s bottom line every month.

With a hyper-focus on profitability and cash, maximizing returns from marketing campaigns became a priority.

2. Maximize areas of cost-cutting

Between rising supply chain, logistical, and human capital costs, it’s become more difficult in the past year for eCommerce brands to maintain acceptable margins. Not to mention, the cost of advertising reached an all-time-high in 2022 and acquiring new customers became more expensive than ever.

With a hyper-focus on profitability and cash, maximizing returns from marketing campaigns became a priority.

+40%

ROAS

With a TBYB offer, Dia’s return on ad spend (ROAS) increased by 40%, helping reduce the cost to acquire each new customer. Since these customers also convert with higher-than-average order values, they were able to optimize on the traffic to improve contribution margin and make every visit count.

+$0.29

Saved per Dollar
Spent on Ads

3. Navigating TBYB returns

Merchants often wonder about the logistical and returns implications of installing Blackcart - specifically, Dia was questioning whether return rates would increase. While blended return rates moderately go up, the incremental increase in sales is 4-5x greater than the net increase in returns cost.

Program configurations are also strategically set to make sure Dia was attracting high-intent customers and mitigating returns increases.

Shoppers have to pay a $20 deposit upon checking out - this is later applied towards the final order value of kept items. If all TBYB items are returned however, the $20 is applied as a restocking fee. The initial deposit ensures Dia attracts customers with actual intent to purchase, and the restocking fee helps offset returns shipping and processing costs. And with a cap of 3 TBYB items per order, Dia was able to keep returns well under control, with 84% of shoppers ultimately keeping and paying for at least one item. Since Blackcart takes care of all returns logistics, Try Before You Buy also caused no changes to Dia’s existing operating practices.

A Stylish Sales Increase.

By The Numbers

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