Miskif x Ridge
A New Era in Wallet Advertising
As a marketeer and a big fan of Twitch.TV I was surprised to see one of the top streamers on the platform, Mizkif, doing a sponsored team advertising the highly popular Ridge Wallet. Back in 2016 I actually make an article making the case for advertisers to jump on the ever-expanding streaming platform, and as far as I’m concerned, the majority of my predictions came true (read this here). For those who don’t know, Twitch.TV, formerly Justin.TV is a live streaming platform. Originally, made for gamers the platform has since expanded into anything streaming-related and was bought by Amazon a few years ago.
Ridge Wallet is actually the first wallet brand to take the leap into the unknown and attempt to market to the vast and wild west world of Twitch.TV. Honestly, I wasn’t surprised to see it was Ridge wallet who took this gamble as they are probably the largest independent wallet brand in the world and were one of the first brands to popularise the minimalist and metal wallet that’s so popular today.
Understanding the Business
This section is more for the curious mind or those who work in or are interested in marketing. This will break down the costs of Ridge to advertise through Mizkif and the profit potential for them in adverting through Twitch and Mizkif combined. First of all, we need to address the fact that no popular streamer is going to advertise a product for free. Streamers usually take an upfront fee for this privilege. For example, I’m going to throw out a modest figure of $10,000 being the cost Mizkif charges to Ridge for adverting privileges.
The second cost to Ridge is most likely an affiliate cost. For each sale, Mizkif helps generate, he’ll take a commission, expressed as a percentage of the sale price, as his own fee. The affiliate percentage will differ from brand to brand, with many offering anywhere as low as 5% all the way up to 30%. For the sake of convenience, I’m going to say that Mizkif will also generate 20% of all sales generated.
Already you can see the costs to Ridge are already adding up quite a bit. But let’s see the profit potential based on what we know about Mizkif, the number of people who watch him, and the amount of time he streamed advertising the Ridge Wallet. Let’s assume that everyone who bought the Ridge bought the cheapest version of the Ridge that comes in at $85.00. Mizkif on average gets around 10,000 concurrent viewers at any one point. Let’s assume that for every one hour of stream time, 1% of those viewers decided to purchase the Ridge Wallet. With some basic maths, we can conclude that Ridge can generate, per hour, a total of 100 sales with 10,000 visitors watching. This would generate Ridge a revenue of $8,500 per hour. Mizkif streamed that day for a total of 5 hours meaning the total revenue generated would be $42,500.
The Profit Potential
Now we get into how much of that would be profitable for Ridge. Let’s first take the initial $10,000 off for the costs to advertise ($32,500). Then let’s take 20% of that for the affiliate costs to Ridge that Mizkif would also take in profit. That would be another $8,500 ($24,000). We also need to take off a further 15%. This is because Ridge currently has a Farther’s Day sale giving customers a tidy discount on all orders. This would equate to a further cost of $6,375 to Ridge bringing the current revenue to $17,625.
Finally, we need to consider the manufacturing costs of the Ridge Wallet itself and the fees incurred from things such as postage costs and VAT. It’s hard to know for sure how much each Ridge Wallet costs to produce, but I can firmly say it’s going to be very little. Ridge is a large enough brand, and considering, economies of scale, have brought the costs to a low number. I can say in reality that you could probably manufacturer a Ridge Wallet for as little as $3.00. Let’s also add an extra $2.00 on top of that for Postage and any additional fees (for whatever). With this calculation in place, with 500 wallets being sold by Mizkif, the total costs for manufacturing, plus extra, would be around $2,500.
So in total, considering all these made-up figures and predictions (some quite modest), I can make the prediction that Ridge Wallet makes a profit of up to $15,125. That gives Ridge a potential profit margin of approximately 35.5%. There are other factors to consider in this calculation that can’t easily be predicted or considered in the effectiveness of this marketing campaign. The likes of employee costs and business upkeep (general overheads) will affect this figure further, but it’s hard to know to what extend.
Overall, a 35% profit margin isn’t a bad result for a first-time campaign. There are a bunch of factors that could play into the future optimization of such campaigns. For example, Mizkif didn’t actually talk much, if at all, about the Ridge and simply had a command in his chat (!Ridge) where you could get more information on the wallet. If Mizkif actually talked, showcased, or even unboxed the Ridge I can imagine the number of sales would drastically increase. Overall, I’m happy to see a wallet brand like Ridge take risks in trying new and emerging ways to market its product. If you’re interested in the Ridge Wallet you can check them out using the link below.
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