An eCommerce Podcast Hosted by Brett Curry

Social Media Marketing World

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Episode Transcript:

Brett:

Well, hello and welcome to another edition of the eCommerce Evolution Podcast. I'm your host, Brett Curry, CEO of OMG Commerce. And today, we are talking affiliate marketing: what has changed, what is new, what's the value of an affiliate marketing program, how does this all work? So I think this show will be really good if you're considering an affiliate marketing program and even if you've started an affiliate marketing program, hopefully we'll give you some tips and ideas and strategies to make it better.

Brett:

And so this is one of those rare, rare shows where I'm bringing on a guest who is physically very close to me. The OMG Commerce headquarters, we're in Springfield, Missouri. We also have an office in New Jersey and then we have some remote employees, as well. But my guest is hailing from Joplin, Missouri, so about an hour away, very close in internet terms. And so usually my guests are from another part of the country.

Brett:

My guest today is Mr. Greg Powell. He is the founder and CEO of Tactical Marketing. He's been running affiliate programs since the dawn of the internet. Maybe not quite, but a long time. And so, I'm really excited to pick his brain and talk affiliate marketing. With that, Greg, welcome to the show. How's it going, man?

Greg Powell:

It's going great, man. Thanks so much for having me on. It is a rarity to talk shop on eCommerce with somebody that you could drive and meet for coffee within an hour.

Brett:

Exactly.

Greg Powell:

So-

Brett:

That's funny, we deal with a lot of clients here on the West Coast or East Coast or whatever and I... Most people don't think of Springfield, Missouri as a hotbed for eCommerce activity, although there are a couple of good eCommerce agencies here. But I remember talking to one client based in L.A and it was like, "Oh, yeah. We're in Springfield, Missouri." And he paused a minute and he said, "I don't think I've ever spoken to anyone from the state of Missouri." I was like, "Well, we have the internet, we're pretty advanced here, even though it may not seem like it." But anyway.

Greg Powell:

I'll tell you, Brett, there are probably even less people that I've spoken with that have done business with someone in Joplin, Missouri.

Brett:

That's a fact.

Greg Powell:

So-

Brett:

That's crazy. We're working on getting and we may, hopefully soon, we'll have our second Joplin, Missouri guest. We've been talking to Toby Teeter, the Joplin Chamber of Commerce president, who also built an amazing ad business and some other eCommerce stuff. Dude's crazy. He's in Joplin, too. So, who would have thought?

Greg Powell:

I am looking out my window of my office across the street at his. So small, small world, man. Know that there are some like-minded eComm folks in our area. But no, I'm excited to be on the show and this is going to be fun to talk affiliate marketing today.

Brett:

Absolutely. So before we dive into the hot topics around affiliate marketing, give us your 90 second background. How did you get started in online marketing? How did you gravitate towards affiliate marketing? Was it one of those things where, as a kid, in school papers and stuff, what do you want to be when you grow up, you chose affiliate marketer?

Greg Powell:

Of course.

Brett:

Or did that just come later.

Greg Powell:

Well, it was astronaut or affiliate marketer in fourth grade. was affiliate marketing. So I'll give you my segue into this space is kind of a funny one. This starts in the early 2000s with the boom of Texas Hold'em an online poker and me being enamored by those guys and playing a lot of poker and being really bad at it, but also building terrible looking websites and doing a little bit of SEO and-

Brett:

Poker and bad websites, I love how this started.

Greg Powell:

And driving people to poker rooms and finding the... There's a Wild West affiliate marketing in those days was something I actually really liked. And while I was terrible building websites and not good at playing poker, I seem to be okay at driving referral traffic. And so I learned more and more about it. I took a job as an affiliate manager of an online poker company.

Greg Powell:

In 2004, I had no idea what an affiliate manager was supposed to do, but I knew I needed a job and it seemed like something that I could really get my feet wet in an emerging market. I just really loved it and just love the idea of the concept of affiliate marketing and the new digital form of word of mouth advertising. And learned a bunch through the years and I've been doing it a long time now. Still learning things, but talk about bad websites, bad poker playing, turning into a career.

Brett:

I love it. I love it. Yeah.

Greg Powell:

That's something my parents probably would have mapped out for me.

Brett:

Exactly. But often, that's how brilliant careers get started almost on accident, or you just experimented with things and you find something that really just clicks and really, really works for you, pun partially intended there. So let's dive into this. We talk to hundreds of eCommerce companies a year through the podcast and through speaking gigs that I have, it's 10s of thousands a year. And a lot of the eCommerce companies we work with, everybody's on Facebook, everybody's doing something with Google. A lot of people are on Amazon. I run into not as many that are actively building, running affiliate marketing programs.

Brett:

So wanted to get into some nuts and bolts here, but I think kind of an overarching question that would be great for you to answer is, what's the real value of an affiliate marketing program? If we don't have one now or just kind of a hobby, we're just dabbling, not really doing anything serious with an affiliate marketing program. What's the value? So maybe we can be inspired to do more with it.

Greg Powell:

Such a good question, it's funny because it seems like everybody that would ever sort of debate or argue on the value of having a good pay search strategy as a nice try, social ads work. I think it's harder now than it used to be. But all those are our channels that people believe in and almost feel that it has to be a part of it, right?

Brett:

Mm-hmm (affirmative).

Greg Powell:

And I'm almost under the same impression. I mean, I really am under the same impression with affiliate marketing. Here's a channel that every brand needs to have in their mix. If you don't, I think the thing you're missing out on is discovering new audiences and adding authenticity. The biggest win for us and for our clients is when a largely followed or highly respected editorial site, or really influential social influencer or blogger, picks up on a brand and showcases it to their audience. And it gets discovered by people who had never heard of it previously. Everything is so hyper focused now with audience profiles.

Greg Powell:

Even if you haven't done affiliate marketing, you surely have done a million different Facebook campaigns and you dial it in and you dial in. And you find these really focused audiences. And I think with any brands out there that has somewhat of a unique product line and somewhat of a unique story on how the brand came to be, the more relevant people that can share that story. I think the more authentic your brand becomes, also you open yourself up to audiences that you may have never thought of. We've managed brands in the past that were... We had a kickoff call, they said, "Hey, here's what we've done for the past year. These are the people who buy our product."

Greg Powell:

And so naturally want to find affiliate audiences that match that profile. But a lot of times we'll be able to bring out an affiliate or type of an affiliate. When I say type of affiliate, I mean someone who creates content and caters to a certain audience. And it maybe an audience profile or audience's type that the brand has never thought would resonate well before. Or just because of sensitivity towards budgets. They don't want to go test every potential audience out there. Yeah, yeah.

Brett:

The surefire wins and so that's kind of an advantage of a third marketing, it tests these audiences with really low risk, because you're only paying if you actually make sales, right?

Greg Powell:

Sure. Yeah. I mean, predominantly the way we work with brands. And the way I think affiliate marketing works best is when you pay for acquisitions, somebody comes through, makes a purchase, they get paid. The affiliate gets paid a percentage of that sale. And we've discovered some wacky audience fits for our clients. And we've also gone after audience profiles, so we thought would be a fantastic fit and it just didn't resonate well. And the nice thing was we went out a ton of money in paid ads.

Greg Powell:

Because essentially what happened is four or five affiliates signed up that had an audience profile that we wanted to test, we thought it'd be a good fit. It wasn't a good fit. The affiliates, unfortunately, didn't make a lot of commission, but that our client, the brand was out of pocket a lot. So, we discover these little hidden gems all the time on new audiences that can tell a brand story to a different set of people that we've never introduced the two before. And you and I kind of chatted before about some of the value ads and affiliate programs, some of the things that are 100% revenue based and don't get me wrong, our number one goal, our number one success metric for every brand that we manage is new revenue, new customers.

Brett:

Absolutely.

Greg Powell:

Then there's a lot of other little bonuses, PR bonuses, discovering new audiences, trust factors. If a large editorial picks up your site, it's always nice, especially if you're in a new startup phase to say as seen on-

Brett:

Yep.

Brett:

Yes. Now guys like me can put that in your YouTube ad and your display ads and just go to town with it and the audience piece I love to because yes, sometimes it just doesn't make sense like with paid ads, you got a list of, "Okay, these are our top five selection." A lot of times we're mapping out a YouTube strategy for a client, we'll create this audience progression where we're looking, "Okay, these are the intent based audiences, the most likely to convert audiences."

Brett:

And if those really hit, then we're going to broaden it and go to affinity based audiences and then we can kind of map that out. But there are some audiences that like, "We don't ever get to because it feels risky." But with affiliate marketing, test some random audiences you find a hidden gem of an audience that's working, I say, "Okay, let's roll that out to YouTube. Let's run some GDN ads to that audience." So I think using that to inform your other paid channels is really smart and price something that a lot of people haven't thought of.

Greg Powell:

Yeah, but I'll share a cool story with you as an example of that.

Brett:

Yeah.

Greg Powell:

That played out last year. So we have a brand that... And it's funny with tactical marketing with this company. One thing I never intended to do that happened was to become tight knit and close to the crowdfunding space. But we've had a lot of success. I'll talk about this a little bit later on, I think why this happened. We've had a lot of success taking brands that have had a really successful crowdfunding campaign. And then they're ready to go, the campaign's finish, they're ready to go, straight eCommerce, we got to drive sales through our website now. Affiliate marketing is always one of the best channels for those types of brands. So we've had a lot of success into a lot of fun to work with those low rated startups.

Brett:

Because we use like a new and novel concept. Like there's something cool about it, they wouldn't have got funded if there wasn't demand and interest and unique stories. Great, great, fun companies to work with.

Greg Powell:

Yeah, and they've already proven that, "Hey, we've got something that people really like to the point where they'll fund this project into a company."

Brett:

Yep.

Greg Powell:

So there's a brand called Ravean. They sell heated jackets.

Brett:

Sorry, what's that again?

Greg Powell:

Yeah, the brand's called Ravean, they sell like heated jackets.

Brett:

And how do you spell that?

Greg Powell:

R-A-V-E-A-N.

Brett:

Better.

Greg Powell:

And crowdfunding success story, great brand, great product. Heated electric jackets, so charging pack, click the button. You're sitting out at a football game in the winter when it's 22 and everyone's dying around you-

Brett:

There's this Chiefs' game in the winter, oh my gosh.

Greg Powell:

Yeah.

Brett:

I went to a playoff game a couple years ago. Maybe potentially the coldest I've ever been in my life. I would have gladly taken that electric jacket, yeah.

Greg Powell:

So yeah, you get really spoiled by this thing. Let me tell you, so you can stay warm, really warm. So anyway, we are... You can imagine, there's a lot of brands and a lot of people should listen to the podcast that have a product that can be seasonal. I mean, heated jackets, something fantastic when you're thinking about going to a football game or parade or anything else, where you're going to be outside for a long period of time. Probably not something you think about in Springfield in July.

Brett:

For sure.

Greg Powell:

So it's a seasonal thing. So we thought, how can the affiliate program kind of aid in the seasonality dip that we get during the summer or the warm months? And so once again, kind of what we were talking about early in the show audience profiles, that we focused on parts of the world where it's cold during this time of year. Yes, that's a strategy, or is there anybody who needs a heated jacket during the summer? And that's the part really scratched my head about.

Brett:

Oh, I've got a guess. I've got an answer.

Greg Powell:

All right, guess.

Brett:

The people that work in like refrigerated areas, so you're in college, no high school, sorry. I worked for an unloading company and we worked in like refrigerated areas that may be a small population. I'm just throwing that out.

Greg Powell:

Actually, I should have this called in before because it's such a great idea and then audience haven't gotten there yet.

Brett:

That's your next free idea. Take it to the clients if they like it.

Greg Powell:

Yeah. It's always good when the guests become a wave from the podcast everyone with more value.

Brett:

Okay, that wasn't the answer, so what-

Greg Powell:

That is a great answer. It wasn't the answer simultaneous at this time was we found that there are a large number of people who are going through cancer treatments and dialysis treatments that are in a certain spot for a long period of time. Dialysis treatment could take five hours. Chemo can take three or four hours. These people get really freezing cold, they can't move-

Brett:

Call the hospitals too man, I think you'll-

Greg Powell:

.. it's really cold, man. That's what people always say when they're at the hospital, "Gadgets freezing cold in here." And so we were able to work with a couple of medical journals that became affiliate partners and it was, we can legitimately help people with a product that could add a lot of comfort to an already uncomfortable situation.

Greg Powell:

We can also partner with the affiliate program and generate revenue for our publication, for our nonprofit that we have here. And so to me, it was a really neat one. We got a good friend who's going through dialysis right now. And that's kind of a nice feel good story, but it's also a prime example of how can we discover a new audience. We can test it and we can find a big solution to a problem that we're having on how do we move inventory during the warm months.

Brett:

Mm-hmm (affirmative). Super interesting.

Greg Powell:

Yeah, people aren't cold outside, but you know what? There's a lot of people who are cold inside.

Brett:

Yeah, yeah.

Greg Powell:

And so-

Brett:

Really smart.

Greg Powell:

Example I really like and it's something that we're always trying to do, everybody's got a different type of products and different type of audience and everybody has a need to increase sales during certain times a year and then capitalize on seasonality that just comes up with different products. We just came off Father's Day. Happy Father's Day multiple times to us, sir.

Brett:

Thanks, man.

Greg Powell:

You are a professional dad.

Brett:

Yeah, exactly. For those who don't know the Curry house, we do have eight children so I'm the father of eight children, six daughters. So yeah.

Greg Powell:

Yeah, I see your Facebook posts that I think Father's Day times many to you, sir.

Brett:

Thanks.

Greg Powell:

So yeah, we had a great Father's Day yesterday as well. Thanks for the kind words there. But we just came off of Father's Day and we've got a lot of brands we manage that are very male, product focused and some meat companies, I was lucky enough to get on that on the-

Brett:

Good for you, man. That's awesome.

Greg Powell:

Takes this year from one of our brands. So anyway, we came off Father's Day, and we've had a lot of brands that had products and offers for that specific day. But I know the one thing you and I were kind of chatting about earlier was offers. I mean, if you're a brand and you're thinking about should I start affiliate program? Do I have a brand that's attractive for affiliate marketing? What kind of offers what I need to put out there? What do I need to pay? What's this thing going to cost me?

Brett:

Yes.

Greg Powell:

So we talked about some of the value ads earlier. If you want to we could dive into a little bit of is this right for me?

Brett:

Absolutely, yeah, I think that would be a great place to start or great place to transition to rather is yeah, how do I know is my brand a good fit for affiliate marketing? Because and you kind of alluded to this earlier on, you know that this should be consideration for every brand, every brand should consider affiliate marketing, we would say, largely the same thing about search and YouTube.

Brett:

But there are definitely some brands that I'll just use YouTube as an example where just makes all the sense of the world, like they could scale on YouTube other brands where you could do okay with YouTube, it should probably be part of your mix, but it's not going to be a complete game changer. So maybe we talk to that on the affiliate marketing side, like what types of brands, types of products, types of offers, are home runs with affiliate marketing versus some that are just good, but maybe not great.

Greg Powell:

Yeah, if I'd say what's the number one question we get? It's that right? Is my brand a good candidate for affiliate marketing? And I'm pretty simple criteria that I've kind of come up with, a little equation I've come up with over the years and for us, it's if you have a product that somebody could be passionate about, we do better with physical products. I don't know, I've heard a lot of things throughout the years, I'll just give you my take on it. I've always seen a physical product that you actually purchase and get in the mail perform a little better with affiliate marketing, certainly digital products out there and we're going to talk about some networks later if you have a digital product I always say that the ClickBank.

Brett:

ClickBank, yeah, that's kind of what they build for right?

Greg Powell:

On the way to go.

Brett:

Yeah, actually in another life actually was not long ago, but 2009 or so I partnered with Russell Brunson awesome influencer on a project called Dot Com Secrets Local, Russell's located in Boise, Idaho and so the founder of ClickBank, so I actually get to drive by the owner of ClickBank's house. It's very interesting, very eccentric fellow there. But yeah, ClickBank has always been like the info marketers product or digital products and some physical product companies use it too. But that's kind of its genesis, I think.

Greg Powell:

Yeah. And that's still kind of the bread butter. So yeah, digital products, I'm still big ClickBank supporter myself. But anyways, products and I think this is why maybe that we've done, that we've had a lot of success with brands that come off successful crowdfunding campaign is because they usually have a product that's very unique. It's-

Brett:

Something you're passionate about.

Greg Powell:

It's something cool, is something... And this is another criteria I always tell people. I say, "If you have a product that you make or a brand that is easy to create content about, then you probably are a good candidate for Affiliate Success." So if you have a product that people can easily create content about, a product that is somewhat different and unique, then those two criteria right there if you check both those boxes and it's probably worth exploring the idea of starting an affiliate program. We get all kinds of super cool things in our office, from the brands that we work with. And we play around with it and we try to think of content strategies and then we go out and we try to align that particular brand with influencers and that's such a widespread term now.

Brett:

It is man.

Greg Powell:

We try to connect clients to content creators to storytellers and that has always been the most natural fit for affiliate marketing. So if you have a product that's unique, that's easy, create content about that there's a passionate audience about if it aligns with the hobby or something that is super helpful, then you probably have a good... You should probably at least explore an affiliate program.

Brett:

Oh, what about on the math side? Because I know the offers important and stuff.

Greg Powell:

Sure.

Brett:

What kind of margins are we looking for? Is there a particular price point that works or doesn't work? Anything you can share on those fronts?

Greg Powell:

Yeah, it's a great question. Some of it has to do with the conversion side. So the jacket I was talking about a minute ago. Yeah, the average order value is the metric that affiliates look at a lot. And then commission is the secondary one. Because most affiliate programs will say, "Well, you talk about throwing one out there." I'll say a baseline commissions is 10%. Obviously, there's going to be some room in there with different products.

Brett:

Sure.

Greg Powell:

But one of the most common questions I always get is, what kind of commission am I going to pay affiliates. And where we start around the 10% mark and work our way up or down from there.

Brett:

Yep. Was that make sense? If you're selling on Amazon, Amazon's usually taking anywhere from five to 15, sometimes 20 if you're doing Google Shopping actions as an example, it's Google Shopping ads but you're just paying if someone actually purchases, it's like five to 20%. So yeah and with most the time of being north of 10. So I think that makes sense. Yeah.

Greg Powell:

And so apparent affiliate, you would actually think would be more appealing to promote a product that has a price tag. So you're going to get a percentage of sale, you're going to make more commission. I think that that is a determining factor. I also think the conversion rate is something that-

Brett:

Absolutely.

Greg Powell:

Some affiliates don't think about as much. If I'm going to buy a new laptop, it's probably something that I'm going to buy every two years, now the price points can be high. If I go through an affiliate link, I feel like it's going to get paid a pretty decent commission on that sale. But I'm not going to be in the market for that all the time, when it comes to apparel some sort of a food product, that can be something I could be buying every couple months. And while on the affiliate side, the commission may not be as high on a purchase like that. There are many, many more times potential buyers out there, right?

Brett:

Yes.

Greg Powell:

I would eventually say that there's a lot more people who are going to buy a pair of tennis shoes online than a new laptop. And so I don't think the price is always a drawback, we manage affiliate programs so the average order value is north of $1,000, we've managed programs where the average order value is 22 bucks.

Brett:

Yep.

Greg Powell:

It's-

Brett:

Is it more about observing? So conversion is important. It's also about being able to absorb that 10% commission, which really, if you're doing any kind of paid media or any other kind of marketplace, you're paying 10% or more to make that sale. Right?

Greg Powell:

Right.

Brett:

So, it's probably the only company that couldn't handle a 10% commission would be a company that just exists on organic sales or something like that, which those are few and far between. So it's probably less about price point. And more about does your margin support that? Which they should. And then considering conversion rate, is that going to be attractive to an affiliate?

Greg Powell:

That's what it is. It's like how attractive can we be? And still be profitable on this. And that's why kind of that baseline of 10%. It's not written in stone, but it's a good-

Brett:

Good starting point.

Greg Powell:

Yeah, good base point to kind of wrap your head around when you think about can I start affiliate channels? Will be profitable. For a lot of our brands, it's funny. I mean, we say, "Hey, we're going to pay a 10% commission." And so many times they say, "We'll take all their customers we can at 10%." Because there's some other channels that we're paying a lot more than that.

Brett:

Oh, heck, yeah, absolutely.

Greg Powell:

I'll tell you, I want to make this time and as valuable as possible for people who are listening. And there's something that I have to address because it's the elephant in the room of every affiliate marketing conversation, and it usually comes up next, after the things that you and I just talked about. And that is the kind of the scary horror stories you hear about folks who start the affiliate program and all they have or they've had a bad experience in the past where their affiliate program is all coupon at deal sites. You think about the way... I'll just use myself as a bad example, the way people shop online. You look at search volume for brand coupon code, brands promo code.

Brett:

Yep.

Greg Powell:

Whatever it may be.

Brett:

Significant for some brands mean a lot of people looking for coupon.

Greg Powell:

I will tell you that I would be very surprised if those weren't affiliate links and what do we do as a brand knowing that that is what happened? How can we still have an affiliate program that is profitable and that achieves what we set this thing out to achieve. Which is divide influencers and brand advocates and not just find people who are already going to buy our product and pay them a commission right. And they have-

Brett:

For some people that's the last step. I've researched it, I've decided I'm going to buy this product. Let me just do a quick check. Let me see if there's any coupons out there.

Greg Powell:

Oh, man, no doubt and it's something that I would be doing you and listeners to the show a disservice if we didn't talk about.

Brett:

Absolutely.

Greg Powell:

So I'll tell you the kind of our approach to it. And I think the way that you can have a diversity program that still remains profitable. People are going to always search for the best deal once they find a product that they like. And coupon sites are going to continue to rank for those terms. Now any well run affiliate program should not allow affiliates to bid on keyword traffic. So when we manage a program, we can totally forbid branding on doing Pay Per Click bidding on-

Brett:

That's traffic you should be getting anyway.

Greg Powell:

You should be getting anyway, there's no value in that. So we have kind of a different approach. And that is, we're extremely strict on the coupon sites that we allow to work with our clients. If they have no ability to drive new customers, then they don't get to play. A lot of these large coupon sites, large deal sites, a lot of people don't realize that they also collect email addresses, they have the ability to show ads on other pages that may have a similar audience profile. And a lot of people have gotten really burned in the past by setting up an affiliate program and then paying for traffic that they probably would have gotten anyway. I'll just be honest.

Brett:

Yeah, I mean, that's one of the... And then you have that experience happen to you, you tell a lot of other people. It's scaring people away from affiliate marketing.

Greg Powell:

Probably Brett. Honestly, I think it's the one biggest hesitation and one biggest area of disappointment for brands that we talked to, that have tried affiliate marketing and failed in the past is because of the kind of affiliates that they've attracted and nothing bad, if you have a brand that coupon sites are latching themselves to, they know it's something that people are buying. They wouldn't waste their time otherwise. But you have to be able to get some value out of those folks, you have to really limit those kinds of partnerships and yeah, there's-

Brett:

How do you go about doing that? You just doing that in the affiliate network? We'll talk about that maybe next.

Greg Powell:

Yeah.

Brett:

You just affiliate, you're eliminating some of the coupon sites and denying them access to the affiliate program. How are you going about managing that?

Greg Powell:

Exactly, right. So for so long, affiliate programs were set up on sort of autopilot mode and that's one of the... Well, we inherit the client that has an affiliate program. We usually inheriting them because they know the value of affiliate marketing. They've just let this program sort of grow out of control, kind of like a yard that you didn't look after that grew all summer. How do we fix this thing to where it's where want it to look at, again.

Greg Powell:

So for us, it's very hands on not allowing affiliates to be able to participate in the program that can't drive incremental revenue, they have to be able to send new customers to the site not just close the deal on someone who was already going to make a purchase. So we're very proactive in doing outreach to the influencer type folks, you and I talked about it first, disallowing a vast majority of those coupon sites. And if the coupon site is allowed, they are always going to get paid a smaller commission than the baseline. So-

Brett:

Makes sense because you're taking a hit on the coupon as well.

Greg Powell:

Take hit on the coupon. I mean, profitability is always the thing that we're keeping in mind. So we know that we are giving them a big tool in terms of a discount to be able to close that person. So that's a big conversion tool. So we've got to be able to safeguard the revenue a little bit. So we pay a lot, we pay a smaller commission to those affiliate sites and we also make it a prerequisite that you have to be able to do some proactive marketing on our behalf whether that's email blasts, whether that's social posts, YouTube you mentioned is one of my favorite affiliate outlets of all time because seeing a product and hearing that review is golden.

Brett:

And that's another thing that I will do before purchases is say, "Hey I'm pretty certain I want to buy this product, but I'm just going to go to YouTube and look for reviews." And so the search for projects YZ and reviews and so you some influencers talking about it, that's really, really powerful.

Greg Powell:

Yeah, we try to harness that a lot. I mean, YouTube is such an incredible medium for product discovery and for validating a purchase. We've gotten to be pretty heavy in the travel space when it comes to clients and we're working with a lot of people who sell really cool techie, travel luggage and backpacks. And if you're going to drop $300 on a travel backpack, I would hope that you do a few Google searches and-

Brett:

You probably do some YouTube videos as well.

Greg Powell:

Yeah, you're going to 100% watch some YouTube videos. And that's where I think, a huge value of having affiliate program. There's a huge value in having an affiliate program because now you have a way to attract and compensate those fantastic reviewers that could introduce your audience or introduce your product to a perfect hybrid target audience, they're coming there because that YouTuber has credibility and respect in that world. And their endorsements worth 1000 words. And so we try to very, very limit ourselves on the attention and focus of these coupon ideal sites and we try to spend all of our time bringing in influencers and people who could open up new audience profiles and showcase a brand to a group of people have never heard it before.

Brett:

Love it. So how do you... So I got really two main questions as we kind of wrap up and there may be a couple of ancillary or follow ups, but how do you go about attracting those affiliates? So you get your affiliate program, how do you find them? What are you doing to identify them? Are you letting them come to you? And then also, we'll talk about affiliate networks. I think that's probably something that's changed in recent years. But let's talk about attracting affiliates first.

Greg Powell:

Yeah, it's so funny, man. It's almost like they're... All my favorite movie is the Field of Dreams movie, right?

Brett:

Yeah, man, that's so good.

Greg Powell:

One of the greatest lines in that movie is you build it, they will come, right?

Brett:

Mm-hmm (affirmative).

Greg Powell:

That is the opposite of what happens when you start an affiliate program. You build it and they will not come or the wrong people will come, right?

Brett:

Yeah. Just like an eCommerce site. You build an eCommerce site no one's going to come. You got to go out and get people, advertise, SEOs.

Greg Powell:

So affiliates, so really what... I think that what separates a successful affiliate program from one that is underperforming, is attracting the right affiliates into that program. One of the reasons we get hired a lot is... Oftentimes one of the reasons a brand will hire us to run their affiliate program is because we have a really large network of contacts, or affiliates that can actually drive traffic and sales. These are folks that... Some of these guys I've worked with 10 years or more now and we know that they're able to just do traffic. And so-

Brett:

And on the flip side, they know that you're likely going to be bringing them products that will sell and products that are really worth their time.

Greg Powell:

Yeah, they very quickly will weed out the folks that are bringing them offers that aren't converting, that are not a good match. And we're pretty cautious about we want to be respectful of their flooded inbox and time as well. So we don't want to just pitch them everyone who comes through. We want to make sure it's a good fit, but we've got some really amazing contacts and relationships now with folks who are thought leaders, rake like crazy high for certain covenants search terms.

Greg Powell:

We at least get some good relationships with those type of folks and it's a constant thing then. There's always new emerging publishers who we want to bring it into the mix and be a brand advocate for clients and there's always new information to share with those guests. So many times an offer or a brand just gets stale with an affiliate. At first seemed like a match made in heaven. And then they never heard from him again, the affiliates are very time sensitive and send me what's going to convert, let me know when I should say, give me the offer. And I'll share with my audience.

Brett:

You need to map all that out. You talk about the content, you need to spell that all out. So the affiliate can just grab it and go, right?

Greg Powell:

Absolutely, we're always working with the marketing team with the client on at least a couple month roadmap. What are the new offers, new products that are coming out, any sales, promotions, events, anything content worthy that we can share with affiliates, so then they can in turn, create content and share it with their audience. Because it helps everybody. So that's one of the... I think that's probably the most crucial piece of Affiliate Success, to be honest with you.

Brett:

Yep, attracting the right affiliates.

Greg Powell:

Attracting the right affiliates, and then getting them the content creative that they need to actually share the offer with their audience.

Brett:

Find the right person, give them the right tools, right message, right offer to share. In terms of offers that... So we talked about 10% kind of being baseline commission, you're paying to that affiliate. What about the offer, they extend to their audience, I'm assuming in some cases, there may not have to be that much of a discount, like it's a new and novel product which is interesting. People may just buy it because, "Hey, this is new and novel, and I want it." But what kind of discounts are affiliates looking for typically, that they can give to their audience? Because they want to be seen as the I can-

Greg Powell:

Yeah.

Brett:

With the deal.

Greg Powell:

So one of the things... Apologies, one of the things that we encourage our clients to do is to sell the value more than the discount, right?

Brett:

Love it.

Greg Powell:

I would tell a huge fan the last couple of years of offers that include... I become a huge fan of like bundle offers as opposed to 10%, 20% off offers.

Brett:

Sure.

Greg Powell:

The last few years, because I think it's just... I hated it, I always think of a brand is something that you're extremely passionate about. You see so much value in it, you want your customers to see a huge value in it as well. And so we've actually really tried to steer away to the last year of the normal 15% off your first purchase type of ad that you see everywhere. And more of buy a jacket, get a free pair of gloves type thing.

Brett:

I like it.

Greg Powell:

And I think that we will always encourage our clients to come with some sort of a product add on or a bundle type offer as opposed to just a direct discount. Now of course, you're going to run into seasonality like Black Friday. You're going to come in..

Brett:

Yeah.

Greg Powell:

And to be able to play, you're going to have to do some sort of an offer. Some sort of discount offer. And we should get creative on commission as well. A lot of people think that you are tied to a commission. And that's what it has to be. But there's some fluidity as well and sometimes it's paying affiliates more, let's say that we have a brand that had an amazing Kickstarter campaign.

Greg Powell:

We've sold a lot of product through affiliates. Now it's time to come out with version two of this awesome product. And we want to get rid of the rest of them that are sitting in the warehouse. And there's certain affiliates that are really good at moving a lot of products if we can give them a bump in commission.

Brett:

Sure.

Greg Powell:

Or give them exclusive 5% off flash sale this weekend, something like that. So there's a lot of genuine partnerships that you can have with an affiliate program. You don't have to... So many people say, here's our affiliate program. This is our block of affiliates, there's individual people in that program that have the ability to do different and unique things.

Brett:

Yep.

Greg Powell:

Knowing who those partners are and knowing how you can sort of utilize their unique attributes. You can start to do a lot of really cool creative things with the partners in your program.

Brett:

Yeah, totally makes sense. I love it. Well, this has been fantastic. I know we could talk for another hour or two more, about different facets, but let's kind of wrap up here with a discussion on networks. So I know back in the day, we'd mentioned ClickBank already, Commission Junction was a big one and now CJ and Pepper Jam and there's a whole bunch more. But what networks are you recommending? How do you go about helping a client land on the right network? Should we use multiple networks? Talk to us about that.

Greg Powell:

Yeah, how we talked about earlier on different affiliate audiences cater themselves better to other products and offers, different affiliate networks also catered towards different types of brains. And I think it's mostly happens due to the type of brands that are on that platform. Commission Junction is still a great network. But there are also some other platforms out there that cater towards different affiliate types.

Greg Powell:

There's a company out of Utah called Avant Link, A-V-A-N-T, L-I-N-K. Fantastic guys who have built a really nice network of outdoor retail brands and affiliates. Fashion apparel, beauty, we have had a lot of success with ShareASale, brands are looking to scale outside the United States that US focus brands looking to grow internationally with affiliates. We've had a lot of success with Awin, which is the parent company of ShareASale.

Greg Powell:

There are different platforms out there with those affiliate tights tend to navigate towards. It's an asset or a brand because selling someone on joining your affiliate program and promoting your brand to their audience is step one, getting them signed up and active is obviously a big step two. If they already feel comfortable, and they already have an account with that network, then it's a much easier process to get them on the program-

Brett:

Make sense.

Greg Powell:

To get them links. They're familiar with the technology, they trust, they're going to get paid. And it just makes the process a lot easier. So it's almost like building a foundation of the house, house could be awesome. You got to make sure that foundation is solid first. Choosing the right affiliate network is a very, very important step one.

Brett:

Love it. Love it. Great. This has been fantastic, man. Super informative, lots of fun as well. So we appreciate coming on. If someone's listening and they say, "Man, I need affiliate marketing and I don't want to go it alone." I'd like to talk to someone as smart as Greg and team. How can people best connect with you and tactical marketing?

Greg Powell:

Yeah. Well, if you're listening to the podcast, you've made it through this far. Thank you so much for listening to all our insights. Just shoot me an email directly actually, it's Greg@tacticalmarketingco.com. And I'd be happy to help. One of the things we do a lot Brett is to program audits. If you haven't fully programmed that... You're scratching your head why is this thing not working? Or I'm already doing a million different marketing tasks. I don't have time to run the affiliate program also, happy to do a free program audit for anybody listening to the podcast as well and see if there's some more value that we might be able to add. So, Greg@tacticalmarketingco.com and I would love to talk to anybody.

Brett:

Fantastic. I will put that in the show notes at OMGcommerce.com. Click on the blog, you can find it there, or just email Greg directly. That's an awesome offer in and of itself. And then it's tacticalmarketingco.com to check out the site. And so yeah, man, tons of fun. Thanks for coming on. We'll have to do part two at some point.

Greg Powell:

We will man, thank you so much for having me on Brett, appreciate it.

Brett:

Awesome. Thanks, Greg. And as always, thank you. Thank you for tuning in. Thank you for sticking around and making it this long. This is awesome. Hopefully you are leaving educated, inspired and ready to up your eCommerce game. And so with that, we'd love that review on iTunes. We'd love to hear any show suggestions or ideas you might have to make this show better. And with that, until next time, thank you for...

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Episode 128

:

Ben Amos - Innovate Media

Using Organic Video at Each Stage of the Shopping Journey

Video can be your secret weapon along each stage of the journey - compelling customers, educating customers, and delighting customers.

The online buying journey is a complex process. It rarely looks exactly the same for different shoppers. BUT, there are distinct stages that most shoppers pass through in their unique journey. Video can be your secret weapon along each stage of the journey - compelling customers, educating customers, and delighting customers.

Ben Amos lives in Australia’s Sunshine Coast and is a master at creating video content that shapes buying behavior. In this episode, we talk about how video can impact these 4 distinct stages of the shopping journey:

Awareness - this is where we tell our brand story in a compelling and helpful way…Ben shows us how.
Consideration- this stage is all about information and education. As shoppers evaluate their options, your video should be there to help guide the way.
Conversion event - your video can and should do the job of a sales person whether on a product detail page or as a remarketing ad.
Advocacy - Your video strategy shouldn’t stop with a happy customer. Use video content to encourage more referrals and repeat purchases.

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Mentioned in this episode:

StoryBrand

“Building a StoryBrand” Book by Donald Miller

Ben Amos - Founder at Innovate Media

Innovate Media - Online Video Strategy and Production Agency

Engage Video Marketing

Engage Video Marketing Podcast

Engage Video Marketing Foundations

Engage Video Marketing Academy

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Episode Transcript

Brett:

Well hello and welcome to another edition of the eCommerce Evolution Podcast. I'm your host, Brett Curry, CEO of OMG Commerce. And today we are talking about video marketing and how video can influence shoppers at every stage of the shopping journey. But, we're not talking about this in the way you may expect to hear about this topic from me. As you know I am more of an ad guy, traffic guy, so we talk about video ads a lot. Today we're going to be talking about organic video. Video as content, video on landing pages and a whole host of other things.

Brett:

My guest today is Ben Amos. And Ben I met at Social Media Marketing World in San Diego back before the world was shut down. Back when live events were still possible. So we got to talking about video marketing and he was a speaker at the event as was I. I was fascinated by some of the things he was talking about. And Ben is the founder of Innovate Media on the sunshine coast of Australia. You'll be able to tell right away, he's got an amazing accent. You'll enjoy listening if for no other reason than just to enjoy Ben's accent. He's also the host of the Engage Video Marketing podcast. And they also have courses and training and I was on the podcast not long ago. So you can tune in to that if you'd like. But with that, Ben, welcome to the show and thanks so much for taking the time.

Ben:

Good day Brett. Thanks for having me.

Brett:

Yeah. I'm really excited. I love video. Been a video guy for a long time. But mainly on the ad side so I really like this perspective, your perspective on this. We're going to look at how video influences the customer journey and where to use it and how to use it and when to use it and all kinds of fun things like that. Going to talk a little bit live video as well. Before we do that, I would love to just hear your background. How did you become a video marketing expert?

Ben:

Sure. Well my background is not in marketing at all. In fact originally it wasn't even directly in video. I started, I guess my career, as a high school teacher and I taught drama and I taught film and television as well to high school students for about seven years. After doing that for a while I ended up finding myself over in London and in then in Ireland, working over there. I ended up landing a job actually not in teaching but with a small video production company on the west coast of Ireland in a town called Galway. And that kind of sparked up this idea of maybe I can start my own thing. Maybe I can start my own business. And when I moved back to Australia that's what I did. I basically left teaching and started a video production company and that was nearly 14 years ago now. And then so yeah, I started just creating videos for anyone who would let me create videos for them and would pay me to do that. I was creating wedding videos, I was creating short promotional videos for businesses. And it got to a point basically where I was creating videos for a local business and being inquisitive, I checked back on what that business had done with their video that we had created for them. And at the time everyone was happy with the video, we got paid. We moved on to the next client.

Ben:

But six months later I look back and all they had done is they'd just taken this video and stuck it up on YouTube. And at the time I remember it amassed a lousy 34 views. And I was like, that's clearly not a return on investment.

Brett:

Not exactly transformational for that business. Exactly.

Ben:

Exactly. So I kind of had this realization that potentially I was failing our clients. We were producing a video that they're asking us to produce but maybe it was the wrong video or maybe it wasn't being used in the right way. So I felt that we needed to do more. And that was about seven or eight years ago and that kicked off the journey for me into really trying to understand what it is about marketing? What is digital marketing? How does it work? How does video marketing work? And now fast forward to now and that's exactly what we do. Our position, what we do here and in my agency in Australia is a video strategy agency. We still produce content but we focus on the strategy first with our clients to make sure that the videos we create actually get results. That's what we can talk about today.

Brett:

Yep. I love it. I love it. The right strategy properly executed, that's where you find results with video or with anything really. But I bet ... And I didn't know that about your history. I didn't realize you were a teacher. I can think back, my speech and debate teacher in seventh and eighth grade, transformational for me. She really helped shape me and gave me confidence and that was part of the groundwork I think for me enjoying speaking in public and stuff like that. So one, tip your hat to you for that. That's awesome that you did that. But then also I bet that came in handy, like teaching people how to be comfortable speaking as a high school student, probably helped you coach people to overcome the fear of being on camera and stuff.

Ben:

Absolutely. I think it's aided me in a whole bunch of ways that I didn't realize until after the fact. A background as a teacher ... Effectively what I do now is I teach. So for me, the way that we attract clients into my agency as well is about leading with value, with education. I teach through the podcast, I teach through my speaking and consulting. The more that I can help our clients understand why we're doing what we're doing or why they should take the action that we're suggesting, the more we can educate, the better informed they are and therefore it's better for everyone. So I'm still a teacher at heart.

Brett:

I love it. I love it. So let's just dive right in. So let's pretend we're consulting with, helping an eCommerce company. And so we're going to be thinking about what is our video marketing approach? And so totally agree with you, we need the strategy first before we go anywhere else. How do you help people come up with their video marketing strategy? What questions do you ask them? What thought exercises do you have? How can we begin to flesh out that strategy?

Ben:

Where it all begins for me when it comes to an effective video marketing strategy is really understanding the audience. If you don't know who it is that you're trying to sell to and the journey that they go on to make that purchase decision, then it's really hard to create content that's going to resonate with them at different stages of that journey they go on to buy from you. I mean, it's the same whether it's eCommerce or a B2B or service based businesses or whatever. But at the end of the day, if we can understand that ideal customer and understand where they start that journey first of all, I feel that most people in business, and it depends on where they are in their marketing journey as a business, but most people are focused on the conversion end of the journey. So trying to get the sale to happen. And that comes from I believe more traditional advertising. The idea of direct response where let's just put our message out there, our sale or our price or our product, and the right people will see it and they'll buy it. And that's fine.

Ben:

But when you're focused at that end of the journey, you're kind of forgetting the rest of the decision making process that someone is going on to buy from you. And so that's where it needs to start is really understanding that when people make a decision to purchase a product, it starts well before that purchase decision at the phase of where they're becoming aware of a need. That awareness phase. When we talk about the funnel, the marketing funnel, we kind of go through a phase of awareness, consideration, purchase, and then advocacy or post purchase. And that's how we can map out a video strategy. So we can start with awareness. Should we dive into that?

Brett:

Yes do it. Let's talk awareness. Yeah.

Ben:

Cool. So at that stage it's critical from a video perspective or any kind of communication as a marketing perspective, that we recognize that people are making decisions here based on emotion. They're not caring about the product that you sell or what it is that you do or what you can offer them. What they care about there is themselves. They're waking up every morning living their own life, dealing with their when issues, their pain, their frustrations, their excitements. These are emotions that are impacting on that person. And that's where that trigger happens that moves them on the path to eventually by something. Should we work to an example Brett? Like is there an eCommerce, like a product or an example we can use to tie it all together?

Brett:

Absolutely. I think that is always easier, clearer when we talk through examples. Let's talk about an eCommerce business. What kind of product or what kind of product category would strike your fancy here?

Ben:

Okay. Well let's talk about baby products for example.

Brett:

Yeah, there you go.

Ben:

Generally babies, toddlers, that kind of thing. I think many people can connect with that. So if we think about selling baby products then there's a realization as a parent who is the purchaser, at that emotional end of the journey, when they're becoming aware of a need, there's a lot of emotions at play. So they're not necessarily thinking that they need a specific product for their baby. They're thinking instead about wanting the best for their child or wanting to ensure that their child develops in the right way and that they're healthy and that they're developing the right way. That's the kind of emotion that's at play there.

Brett:

And they don't want to be a bad parent and they don't want to be seen as a bad parent either. All those emotions come in and they don't want to fail at this.

Ben:

Absolutely. So for a brand intending to get that parent to buy their product, we need to start first by marketing to them at that emotional end of the journey. You see the big brands do this. So the big brands are going to spend a lot of money at this awareness phase in creating emotional advertising or emotional campaigns. And video works really well here. And the best way I direct our clients to use video at this awareness end of the journey is to focus on story telling. So story telling as a form of communication is intrinsically emotional. So if you tell stories, people resonate with them at a more emotional level. So here for the baby products you're going to tell stories around parents and around the successful upbringing of a child into a healthy toddler and that kind of thing. And obviously the product comes alongside and is the guide or the thing that supports that happy outcome of this story. So here you're not directly selling your product or pitching your product. But instead, you're telling an emotional story that people can buy into. I think it's critical in this kind of purchase journey to first get people to buy in before you ask them to buy. Buying in is an emotional thing.

Ben:

So that's where it needs to start. So an organic video strategy needs to start by thinking, how are we going to use video to position our brand with the right emotional connection with our ideal audience? Because if you can do that then they're more likely to actually resonate with the rest of the way you're going to communicate with them on the purchase journey. Does that make sense?

Brett:

To shift tactical for just a minute, so we're thinking about awareness, we're trying to understand the emotions that our new parent is having that we would love to build a relationship with and hopefully eventually sell some products to. So we're thinking of these emotional stories. So where are we deploying this in? Is this going to be specific videos we put on YouTube or other places that someone may search and find organically? So they're maybe searching for the answer to a question or how to solve a problem or how to get my baby to do this or that or where would you think about deploying this or are we not quite ready to get to that point yet?

Ben:

It's a good question and it's an important question because at this stage the intent of the audience ... They're not actively searching. They're not yet in that middle of the funnel, that consideration phase. They're simply living their life, going about their everyday life, and because of the emotions that they're feeling internally, they're open to that sort of emotional messaging. So using a paid strategy here is where you can target cold audiences. You'll be familiar with that because you put that kind of emotional messaging in front of them and even though they weren't thinking about even considering a purchase, now they're starting to think about it. But from an organic strategy, the goal is just to put it in places that you can get the most eyeballs. So yes you would put it on the front page of your website for if people are referred to your bands. They're going to come in and they're going to see that and resonate with your brand and understand that you're a good emotional fit for what we want. You're going to want to use YouTube for example, so that it potentially will come up in suggested videos or things like that. You would use organic social media as well. And ideally the goal here is to get it to be sharable.

Ben:

So if it's a story that somewhat emotionally resonates with them they're likely to comment on it and say, that was beautiful, that really connected with me. And then you get this kind of organic social spread. That's the goal here is to use that video organically everywhere where your people are hanging out. Or you can obviously apply a paid strategy to it as well.

Brett:

Awesome. So that is we're looking at okay, I'm creating this content for the awareness stage. I want to tell a story. I want it to be emotional. But what kind of content? What thought starters? What questions should I be answering? How would I come about getting an idea for a video that's going to engage people and make them want to watch? So again, let's keep using this baby product company. I like that example.

Ben:

Sure. Again here recognizing that it's not about you, that it's about your customer. So when you think about story telling and referencing Donald Miller and StoryBrand-

Brett:

Yep. Great book.

Ben:

He often talks about the idea of ... Exactly. That you're not the hero of your brand story, that your customers are. And that's the way to think about it. So whether you take a direct storytelling approach in your video or you take something that feels a bit more organic and natural or user generated, the idea is, your products really shouldn't be front and center. It should be there. It should be clear that your product is being used in this situation. But it really needs to be about the people and the emotions that they're feeling. So there's a number of ways this can look. You can certainly use an awareness type video here to position your brand. I would call this a brand story video. And this might be more telling the story of the product's foundation or inception or invention. Or it might feature interviews with the founder of the company. But again it's not about the company, it's about why did they discover this new type of baby food that's organic and healthy or something? Whatever. Just making that up. So it's all about the idea of communicating the why behind the brand rather than the features, the what. Again, referencing Simon Sinek for example. Your listeners might be familiar with that.

Ben:

So that's what the video can potentially look like. It can take a lot of different forms, but I think critically it needs to be human. It needs to take people on an emotional journey in some way. People need to resonate with it and you need to really understand your audience to know what it is they're going to resonate with.

Brett:

Yeah. I love that. And so looking at ... And you mentioned organic baby food. That's actually a good example where you look at, the founder of this business could be telling the stories of years ... My baby had all these problems and wasn't sleeping and wasn't happy and we didn't know what to do, we're at the end of our rope. Just tell this emotional story. And then we started trying at the request of somebody, these organic foods and then it worked so well we created our own company. And you begin to tell that story. And then other parents who are in a similar situation they say yeah, that's me. I'm there. I've been there. That type of thing.

Ben:

100%. And I also love using client stories or customer stories here as well. So if you're not comfortable telling your brand stories directly as that then use your customers to tell the story. Because your other ideal customers are going to resonate with other people like them. And I think critically it's not a testimonial. It's not like a product testimonial where you have people at a shopping mall and they're just tasting your product and going, "Yeah, it tastes great. We love it." That's kind of more down the other end of the journey. But here you need to be taking people on a story arc. So like you explained the customer might say, "I was frustrated that I couldn't find this kind of product for my child." And like you said, there was pain there. "And then we discovered this product and now we've got this new normal life where our child is growing and thriving and happy and healthy and all that sort of stuff."

Brett:

That's awesome. Okay so we've got the awareness stage. Beautiful explanation there and walkthrough. So next is the consideration stage. The shopping journey. So what are we looking at here? What types of videos? How are we approaching this? Walk us through this stage.

Ben:

Absolutely. So recognizing that the intention of your customer here is now focused on research. They're focused on okay, I'm thinking about purchasing something. I don't necessarily at this stage know what it is I'm going to purchase. I'm not even now thinking about specific brands or products. I'm just thinking about solving my problem, whatever that problem is. And this is where people move into this research phase where now they're googling stuff. Now they're actively seeking information. Maybe they're doing that through digital means or maybe they're just speaking to friends or talking to their mothers groups for example in the baby product example. But critically what the customer wants here, what the potential customer wants here is the information. So the goal here for video in this consideration phase is to think about how can we show up for our idea customers with the information that they're looking for? So from a video perspective I talk about using helpful content. So again, it's not about pitching a sale or even pitching a product in any way. It's about how can you answer the questions that your customers have. So think about frequently asked questions. Think about what are people searching for?

Ben:

This is where things like keyword research can be really valuable. You want to be creating short videos that are allowing your ideal customer to get a small win. So they watch your video and they learn something or the feel a little more informed about something. And again, I just need to preface here that it's not about educating about your product, that can come later. But right now it's about educating about the problem that they're facing. Using the example of organic baby food for example, you might create some videos which are educating about what is in non organic baby food. The kinds of things that maybe cause issues that they haven't thought about. Maybe you're going to create some content around just general natural baby health. And it might not be related to food. It might be like, ways to dress your baby for summer in natural fabrics for example. You might not even sell natural fabrics. But you know that your ideal audience that's going to buy your organic baby food, they're going to resonate with that kind of content. Now of course it's going to be a brand impression in this kind of content so you have your logo there or there's a representative from your business is presenting that information but it's not about pitching the product at this stage.

Brett:

Great. And so keyword research, frequently asked questions, I really like those concepts a lot. Other tips that you would give for how does someone get started there? So frequently asked questions, are they just kind of brainstorming and coming up with those or do you recommend people interview customers to kind of come up with some of this content? Or how are we generating the ideas for this content?

Ben:

Yeah. It's all of the above. So yes, you can do your research just using data that's available to you. But the best way is to ask your customers. Whether it be through customer surveys. So, what were you searching for that lead you to our product? What questions did you have before you bought the product? That kind of thing. So where you can, getting real data from your customer. Just listening. And that should inform the kinds of content that you can create. So speak to your people who meet your customers or who are on the ground or your salespeople. They're getting the same sorts of questions over and over again. So you need to be showing up and answering those questions. So that's a really good way to do it. The other way to go about it is to think about ... Like I said before, just do some brainstorming around really understanding your audience and what other things do they care about that are maybe just one step removed from your product? So yeah you sell organic baby food but like I said, maybe you can create some content around clothing or around general baby health or maybe you can bring in some expert content as well. Like maybe you can get a doctor or a baby health expert to create some content about getting them to sleep or settling babies.

Ben:

All that sort of stuff is what your audience is going to lap up and you can show up and be that expert source for them. And then when they're ready to buy, who are they going to buy from? You've already built that trust and built that relationship with your customer. And that can be really impactful.

Brett:

Love it. So let's talk a little bit about the technical side of creating these videos. So how much do we worry about ... And again, I've got several thoughts here from the ad side but how should we think about production quality? How are we filming these? Is this going to be on our iPhone? Should we hire a production company? Does it vary between the awareness stage and the consideration stage in terms of how you're creating this? Just speak to production quality a little bit.

Ben:

Sure. It's a good question because as you move down the funnel I believe that you can start to drop production value as you go because it's kind of ... I kind of liken it to dating. On your first date with your prospect in front of you across the table at the restaurant, you're going to wear your best clothes, right? You're going to make sure you've had a haircut, you got a shave, whatever. You're going to smile and give a lot of eye contact and a lot of attention. That's what you need to do on the first date. And then as you get to the 20th date or even the third or fourth date, you're probably going to be a bit more casual. And then obviously ... This is making assumptions. But once you're kind of married or you're engaged then maybe you can let your guard down and you can be yourself. Liken it to that. So from a production quality perspective I think you need to ... If you're going to invest higher budget and hire a production company then your awareness content should reflect your brand highly in that way. It's like your first impression.

Ben:

As you move further down ... And it's going to vary based on budget. If you're a large organization and you can use professional production all the way through this journey, that's great. But if you're a smaller company, then you can start to pull back on production quality as you move down here. So at this consideration phase, I think the goal here is just to be smart about how you produce content. Often you can produce content in a batch here, so it's not just making one video once but it's like let's do a filming session, say with that child health expert, and create 12 pieces of content from this one opportunity. So short videos that are used as regular content marketing, it's all part of a strategy here. So budgets are going to vary, but that's the way I think about it.

Brett:

Yeah. I think it's way more important to be valuable. To resonate, to deliver a message that speaks to people than it is to have high production value.

Ben:

Absolutely.

Brett:

So it's more about the value of the content. But I do like that dating analogy. The dating analogy. Hey we can get more ... You've still got to be valuable. You've still got to be intentional and bring energy and value throughout the journey, but you can be more casual potentially. You can be more real, whatever, if that's the right word, the further down the funnel you get. So I like that a lot. Where do you believe live video fits into all of this? Whether we're going YouTube live, Facebook live, some other service. Where does that fit? In any and all categories or how do you typically use it?

Ben:

It can be used in any and all categories. It's about what you present in your live or how you go about sharing the information. So you can use live video to tell a story to make an emotional connection in that awareness phase. You can absolutely use live video. And this is probably where it's more commonly used in the consideration phase here where it's more about providing value, educating people about something. Or even entertaining. At the consideration phase if you can show up and just be entertaining for people, then they're going to spend more time with you and your brand which is valuable as well. So live video works really well here. But live video can also work well at the next stage which is all about actually making that sale, that conversion into the journey. And that's where you can do a live product demonstration for example or a live sale event which can be quite impactful as well with live video. So it can be used anywhere across this journey.

Brett:

Great. Let's transition. Let's talk about the conversion stage, the purchase stage of the journey. How are we using video at that stage?

Ben:

So now recognizing that the intent has changed again and now they're actively looking to purchase. Whether they purchase from you, or they purchase from someone else is really what's at stake here. Or postnatally not purchase at all. So what we need to do is show up for people with our content that overcomes any potential objections they have from buying from us. So this is where if the other end of the journey at awareness was about emotion, now we're about rational information. When someone's going to part with their cash and press that add to cart button or whatever it is, they have rational questions and they need rational answers. So they want to know the facts, the figures, they want to know how it works, they want to know if it's a good fit for them. So this is where your video need to do the job. Particularly in eCommerce. This is where it need to do the job of what a traditional bricks and mortar sales person would do in a retail store. So you're in there. So the intent is that you're looking to buy something usually. So that salesperson's role is to actually show you your options, help you try things one, see if it's a good fit, understand how the thing works, open and close the doors, press the buttons. All that sort of stuff.

Ben:

So from a video perspective, that's what you need to do is to create videos that help the purchaser overcome any objections that they have to buying from you. And critical here is that these videos, they need to be deployed on the page. Whether it be a shopping cart page or wherever there is a limited barrier to that sale talking place. Because if it does its job it needs to be just one click away from add to cart basically. So these kind of videos they really shouldn't be on social media or on YouTube or on the front page of your website where they then need to go into the story or the website and actually kind of find the product that you were talking about. Does that make sense?

Brett:

Yep. This is on the product detail page. This is-

Ben:

Landing page.

Brett:

Email maybe to an abandoned cart list or something. Someone who's really close to making the purchase. We're now demonstrating, showing them the details, really clearing up any questions. Handling any objections. You're hopefully pushing them over the edge to say yes and to purchase.

Ben:

Absolutely.

Brett:

Fantastic. Very, very good. Cool. What other tips would you give to someone again, kind of getting started on creating videos for what equipment do you invest in, any things along those lines of how to get started in creating this kind of content?

Ben:

Before we get into that Brett, can we go one step further with the journey? Because I think it's critical to recognize.

Brett:

Oh absolutely. I forgot advocacy, right?

Ben:

Advocacy. Yeah. But let's go back to the technical stuff because the advocacy stage is next. Because after the purchase is made, we recognize that that's not where the journey end because our goal here is to provide a fantastic customer experience so that they'll buy from us again, increase lifetime value, refer other people into the top of the funnel here. So using video here is something that's often really overlooked by everyone in business. And particularly a lot of eCommerce as well. And there's real opportunity for using video in a way to just surprise and delight effectively. So some examples of this ... And it can be used in different ways. But maybe it's a video on the confirmation page just saying thank you for making this purchase. So a personal ... It feels personal. Thank you for buying this thing. We can't wait to hear how it improves your life. Or maybe it's a video that comes through in the receipt email for example that makes you feel that you made the right decision in buying this thing. I think depending on the product buyer's remorse can be really critical thing here.

Ben:

So you can for example if someone's just bought something that's a higher ticket thing, have a video that comes out from the founder of the company or from someone within the company. It doesn't need to be highly produced, it just needs to feel personal. Just saying you've made the right decision, this is what happens next. We've now got the order and then going to be dispatched within one day and you can expect it within a week. Whatever. Now people feel like okay, we're clear, I made the right decision. You're going to probably minimize support requests or refund requests, all that sort of stuff just by using video in a way that is surprising to people. I think another way to think about video here is using it as part of your CRM or something like that where you can actually say, okay, so someone's bought from us six months ago but haven't bought from us again depending on the frequency of the purchase for your product. So you can actually trigger something in your CRM that says, okay, let's send them a re-engagement video which is ... And it's actually really powerful if it can be personalized and there are ways to do this through different video tools.

Ben:

Where maybe one of your salespeople gets a little notification in the CRM. It says, "Hey, Brett hasn't bought from you for six months, time to re engage him." You can just press a button and basically opens up your webcam and during can say, "Hey Brett, how are you? It's Ben from Baby Food Store. We noticed that you haven't bought from us for a little while and we'd love to get you another order shipped out. So how can we help you further?" Or something like that. You can do that in a personalized way and that really stands out for people and it's more likely to improve that customer experience and get them buying from you again, talking about you and the possibilities here are kind of endless.

Brett:

Yeah. That's so good. And I think there's a lot of way that you can use video in that just right after purchase stage and you hit on some of these. But even a video telling people what to expect. So hey, when the product arrives it's going to come in a box like this. Here's how you get into it. You open it up and ... Like almost an unboxing video. Or when you're using the product for the first time, here's what we recommend and here's some things you may run into. You kind of alluded to that or mentioned that, that hey, that can help with support requests. It also helps build the anticipation a little bit of when the product comes. It shows that you care as well. It shows that you're really engaged and interested in them as a customer. So lots of ways to use video. And especially in that stage. That does not need to be high production quality. Just good lighting, clear message, iPhone or whatever and just deliver that and that's perfect.

Ben:

Yeah. 100%. Love all those ideas as well.

Brett:

Yep. Yep. Awesome. Okay, so we got our stages, we got awareness, consideration, conversion or purchase and then advocacy. And so then let's talk through some of your favorite tools and technology to make this process easier. Because I think there's a lot of people that just don't know where to get started.

Ben:

I think as you just mentioned there, critically just get started with what you've got. You've got a smartphone in your pocket or a webcam on your desk then you've got the tools to create video. Like we said, tolerance for production quality can vary depending on budget and where your video fits within that journey that we talked about. But don't use technology as an excuse not to get started. There's no reason to use that as an excuse these days.

Brett:

To kind of piggy back on a point there, we ... As we're talking about YouTube ads as an example, we'll recommend, hey start with remarketing first. Talk to your customer first. Do remarketing, repeat purchase, reorder campaigns or whatever. And again, those are the areas where you can be a little more raw and authentic. So yeah, I'm really glad you pointed that out. Don't let the lack of technology or equipment keep you from doing it and start with those lower in the funnel videos first and then you can kind of work your way up. That'd be my advice anyway.

Ben:

Yeah, absolutely. And I think from a tools perspective, it's kind of endless as well. I think that using tools that are available to you such as social media, tools like using live video is free and available to anyone with those social media accounts. I think when you get down to the conversion end, particularly for eCommerce, using video tools that allow the right analytics is critical. So don't just embed a YouTube video on your sales or your product page. Just doesn't allow you enough of the metrics that you really need. I'd recommend using a tool like Wistia or Vidyard for example. But Wistia is probably the most common used tool there which allows better analytics and better ways to track engagement with the videos. Then when we get ... Let's just talk quickly about some of those personalized top video tools because some people might want to experiment with those. I really love Bonjoro. Bonjoro is one that is free to get started with and you can connect it through certain triggers with a CRM or shopping cart software.

Ben:

So someone buys your thing, your app on your phone will kind of ping you with a notification to say, so and so has bought the product. Then you can just pick up your phone, shoot a quick little video and say, hey just saw that your order come through for our baby food, whatever and it's so awesome to have you here. We're really passionate about what we do and we can't wait to get this product in your hand. Thanks again for buying from us.

Brett:

I can also see that being used for some eCommerce stores that are going to get thousands of orders a day or whatever, that'd be kind of difficult. But I could see once someone reaches a certain threshold, hey, this was the fifth time they've purchased or something like that, they've now graduated into this class of this is one of our best customers, let's trigger this process. It was Bonjoro?

Ben:

Bonjoro. B-O-N-J-O-R-O.

Brett:

I got it. So now that triggers and now we'd say, "Hey, they just told me. You made your fifth purchase. We are so excited, we're so thrilled. Here's what we're going to for you. We're going to send you this little gift or be on the lookout and we're going to email you something special. But just wanted to tell you thank you." Something simple like that and you do a handful of those, you take someone that's a great customer and make them even a better advocate. Really cool tool and tactic there for sure.

Ben:

Absolutely. Some of those are not scalable, but it's the things that aren't scalable that really build those relationships-

Brett:

Absolutely.

Ben:

Improve those advocates experience.

Brett:

Yep. Cool. Excellent. Any other tools or resources you'd recommend?

Ben:

I can't think of anything of the top of my head except I think just recognizing that if people don't get bogged down in the technical stuff. I think that when it comes to editing, people are thinking, I'm going to film my own videos and now we need to get them edited and things like that. I'd just look for ways to keep it natural, keep it real, keep it authentic to your brand and your business. And that resonates these days. The tolerance for lower production quality I think even now post coronavirus is probably even-

Brett:

Now it's just everybody having kids walk in which I had kid noise earlier. Yeah. It's just people are pretty to tolerant of that. Shows you're human.

Ben:

Yeah. Absolutely.

Brett:

Fantastic. So you have an amazing podcast that people should check out. So talk a little bit about your podcast and what you cover and then any resources, articles, blog posts, things like that that people should check out.

Ben:

Yeah, thanks very much for that. So we also have awesome guests like Brett for example recently. The Engage Video Marketing podcast is basically all about exploring this world of online video and its power in moving people to take action. So I interview a whole bunch of guests in all sorts of different areas about this space of online video which I am super passionate about. As far as further resources, further learning, if they head to engagevideomarketing.com, to the main page of my website, there's a few different options there. I have a free foundations video course. That's actually at engagedvideomarketing.com/foundations. Which will kind of walk you through the foundations of what an online video strategy might look like for your business. And I also have an academy, a membership for ... More for the DIY video marketer, the smaller business, maybe a smaller eCommerce out there and they're just trying to figure out how to do this video stuff themselves. That's at the engagedvideomarketingacademy.com.

Brett:

Really good stuff Ben. This has been fantastic. What about on the socials? Are you active on Facebook, YouTube channel, things like that?

Ben:

Yeah. Just really building my YouTube channel right now. It's something that I neglected for too long. You can just search Engage Video Marketing on YouTube or Engage_Ben on Instagram is a great place to find me too.

Brett:

Awesome. Ben, this has been a ton of fun. I love talking video. I love your approach and your perspective so really appreciate you taking the time and being so generous and sharing your insights.

Ben:

Thanks Brett. Awesome to be here.

Brett:

Yep. Absolutely. And so as always, thank you for tuning in and spending your time here on this show. We would love to hear your feedback. Let us know what you'd like to hear more of, less of. We'd just love you feedback. Also we'd love your review on iTunes. So if this show has been valuable, share it with somebody. Leave a review on iTunes. That helps other people discover this show as well. And with that, until next time, thank you for listening.

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Episode 127

:

Nick Stagge - Wooly

Put Digital Rails Around Word-of-Mouth and Building an Ambassador Program

In this episode, we discuss two important topics - building Ambassador Programs and putting digital rails around word of mouth advertising.

Everyone knows that word of mouth is the most effective form of marketing. The problem? How do you facilitate, encourage, and track it without being weird? Enter Nick Stagge and Wooly. In this episode we discuss two important topics - building Ambassador Programs and putting digital rails around word of mouth advertising. Nick has worked with some awesome brands including Skull Candy, Purple Mattress and more. Here’s a quick look at what we cover in this episode:

Salomon shoes got 22.6 million impressions without running a single ad
How to Identify and segment your best customers and how to know when you have a customer make a referral that ends in a purchase
How ambassador programs focus on credibility while some influencer programs focus on reach…and why credibility is often better and more profitable
Word of mouth customers are happier, better educated and often stick around longer - here’s how you get more of it
Driving six figures of incremental referral revenue.
Plus more

‍

Mentioned in this episode:

CONTACT at Wooly

Scott Paul - CEO at Wooly

Nick Stagge - CMO at Wooly

Daniel Fischer - Account Executive at Wooly

Nick Stagge - CMO at Wooly

Wooly - The Most Powerful Word of Mouth Marketing Platform

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Episode Transcript

Brett:

Hello and welcome to another edition of the eCommerce Evolution Podcast. I'm your host, Brett Curry CEO of OMG Commerce. And today, we're talking about a bit of an unusual topic for our show, eCommerce Focus, talking about what's new and what's next. We're going to be talking about a topic that's been around since literally the beginning of commerce.

Brett:

We're going to be talking about word of mouth advertising. Right? But not just word of mouth, we're going talk about how do you put digital rails around word of mouth. And if you don't know exactly what that means, that's cool. We're going to explain that. And then show you why it's powerful and how it can work. And we're also going to talk about building an ambassador program. I'm really excited about this topic and going to be very useful, practical and fun.

Brett:

My guest today is Nick Stagge. And Nick is the CMO of Wooly, which is a tool to help in these endeavors that we're talking about. And so we'll get into that in a few minutes as well. But with that intro, Nick, welcome to the show. And how you doing, man?

Nick:

I'm well, thank you so much for having me. I love the work that you guys do. And I'm pretty geeked to be chatting with you today.

Brett:

Geeked. Man, I will join you in that state of being geeked. Just quickly, let's talk about how you got to this point. Right? So what's your background in marketing and eCommerce or even non, and then how did you come to Wooly?

Nick:

Yeah. Well, I've spent the better part of a decade working in retail face to face. I was managing a chunk of the Western United States for a national retailer. And I learned that people interact with people in a variety of ways, but when you have a strong relationship with someone, it's so much easier to help them be confident in deciding what to buy.

Nick:

In my 10 years there, I also realized that most brands weren't doing a lot to help retailers create those relationships and sell their products. And this was... And this dates me, but a lot of this was really before e-com kind of took off. So I left retail and I worked for companies like Skullcandy and GoPro, building out these global advocacy or ambassador programs. We started with retailers and then we moved our way into press, and athletes, and influencers, and distributors, and... You name it.

Nick:

I started to realize, wow, this is really hard to do without technology. I could scale so much faster if I had great tools available to me. And so, much like I had done the transition from retail to manufacturing, I went from manufacturing and working at consumer goods companies to working for tech companies that were empowering that very behavior.

Nick:

So I spent five years running marketing at ExpertVoice, a company that really focuses on the industry professionals and retailers. And then about a year ago, I made the transition over to Wooly to be their CMO. I made that move because I'm following the trend, if you will. Or I'm projecting and forecasting the trend that it's moving from macro, to micro, to nano influencers. And if you follow that all the way down, it's just every day customers. And if we can put digital rails around that word of mouth marketing, we can solve some really big problems. So, that's why I joined Wooly. And that's where we're at now. That's the problem we're trying to solve.

Brett:

That is a fantastic background. I love the progression there. I love that experience. I think so much of what we do is better informed if you just understand the way people shop and why people buy and the way people buy. And certainly, there are differences, obviously, the way someone shops in a store and the way they shop online. But understanding shopper behavior is so crucial because a lot of it is the thing.

Brett:

And so love that progression, love that you bring that deep knowledge of the in store shopper and then the knowledge from manufacturer, and now on the tech side. That's super fun. I want to get into some of the details of Wooly, and what will we does, and what it is, and how it helps put these digital rails around word of mouth.

Brett:

Before we get into that though, I want to just talk about why build an ambassador program. I think some of the benefits are obvious, but I think it'd be good for you to kind of map out why should we do this. Because we talked to hundreds and hundreds of eCommerce companies as where talking to people that want to help with YouTube or Google ads or Amazon ads or whatever. The vast majority do not have ambassador programs that we talked to. So why do it? Kind of walk us through the why, first?

Nick:

Well, I think customers are emotional buyers. Right? I mean, we buy based on emotion, and then we justify our emotion with logic. And if you can build an ambassador program, what you're doing is you're creating a deep connection between your product and brands and your customers. And when you do that, suddenly, they're buying a new set of skis every year. You don't need a new set of skis every year, but you're doing it because you're so emotionally connected.

Nick:

It's not just that building that ambassador program is a one-to-one, I have this relationship and now that person is going to buy, but it then helps create an entire army of, call them micro marketers, on your behalf. They will actually spread your message. They will promote your brand. They will help you grow the entire funnel, from awareness all the way to point of purchase. And if you do it in the right way, they do it, not for cash, they do it not for a monetary gain, they do it because, once again, they're emotionally connected and we just... That is how humans buy.

Nick:

So, I think it's important that every brand looks to build better relationships with as many customers as possible. Because when you do that, they help you in turn generate and acquire new customers.

Brett:

Yeah. I love it. And it's always... It used to be surprising to me, it's not anymore. Because I see it all the time. But we as marketers, we as eCommerce professionals, we're guilty, and so is every business owner really. of forgetting about our good customers. Right? Or taking them for granted from the standpoint of we just think they're always going to buy from us. And we think that whatever they're doing now is the most are going to be doing, and we can't really get them to buy more, we can't get them to be more loyal, we can't get them to be more outspoken about our products. We sometimes forget about them.

Brett:

And sometimes it is a little bit sexier or more enticing to go after new prospects all the time. Right? How do I ramp up my YouTube ad spend? Which is fun. I like to do that. I will not-

Nick:

Yeah, of course.

Brett:

... try to talk you out of that.

Nick:

Me either.

Brett:

Yeah. But we forget about, man, you've got this army and... I like that term micro-markers. You got this army of people that know you, like you, trust you, why not build better relationships with them so that you sell more to them, make their lives better, you benefit as well. And then structure where they can go out and tell all their friends. And then, hey, you get a lot of new customers from that as well.

Nick:

Yeah. Well, I think a reason that that happens is, marketers, to our credit, we have done a really good job showing our input and our value. We can sit down with our CFO and CEO and say, here's our dollar in dollar out on our YouTube spend, here's the roll as a last month versus this month and how we're improving it. And in some ways, that's a detriment to marketers. And you see the CMIO... I mean, it's a dangerous profession to be in. Because the CMO churns faster than any other executive in the executive.

Brett:

Very true.

Nick:

But it's really hard because there's this disconnect with a lot of executives that think brand is not performance because you can't measure it. But it is performance. Sure, it's not as predictable, it's not as easy to track. Therefore, it's not as easy to manage and to optimize. But if you buy into that long-term strategy, and you have a CEO and a CFO who support that long term strategy, you can go out and build it. And brand is compounding.

Nick:

So if I can build a great relationship with you, then I've secured you as a customer, and hopefully, I increase my lifetime value with you. But then over time, it's not just my life-time value with you, it's that you're helping me acquire customers for a cost that I spent months ago or years ago. Right? So my customer acquisition costs, in some ways, you're like, well, that's zero. It's not. But...

Nick:

You get the point, right? It's this compounding thing, but because there's really fuzzy metrics behind it. And there's, there's no way of seeing it. It becomes the first thing that you're like, "Well, COVID hit and budgets were getting slashed. That's gone, I'm done with it." But that can be a dangerous long-term play.

Brett:

Yep. 100%. Fully agree. So tell me about... What are some of the more successful one or two of the more successful ambassador programs that you've seen? Either companies you've worked for or with, or just had experience with whatever. How did they work? Kind of fill us in on that.

Nick:

I think the biggest fun I've ever seen was it GoPro. When I was there, we would travel the world and we would hold press conferences and meet with distributors. And Nick Woodman always prompt us like, you have to ask this one question. And we would ask how many marketers do you think are on our team? And no one ever got the answer right. Because the answer was -

Brett:

Everybody over-guessed, right? Or no, under-guessed, I guess I..

Nick:

Under-guess. They were like, "Oh, you're a huge company. I don't know, 100, 300? How big is your company?" We're like, "Well, at this point, we have 1400 employees." "Okay. Yeah. Maybe 250? I don't know" And our answer always blew people away. Because we were like, we genuinely believe anyone who's ever bought a camera, or use the camera, is on our marketing team. And we tried to treat them as such.

Nick:

And when you do that... Look, GoPro also just hit at the right moment with digital and YouTube. And the product itself is very viral. But we capitalized on that when other people didn't right. So we prioritize spending time, energy, resources, in creating those relationships and building diehard, raving fans. And because of that, we didn't have to tell us a new customer GoPro is the best, because our customers were telling their friends. I think that's a big example.

Brett:

And how did you... Just kind of clarify a little bit. I really liked that, where you think about, okay, not only as a customer a customer, we should value them and take care of them, but they're also a marketer. Right? They're on our marketing team for us. How did that shape the way you treated customers, spoke to customers, whatever? How did that impact your decision-making, thinking about every customer is on the marketing team?

Nick:

Yeah. When you've got that many customers, conceptually, you're like, oh, that makes a ton of sense I'm in. And then realistically, you're going, well, how to treat every single person that way? So we segmented them into groups and we were like, okay, these people at the top of the pyramid are number one and number two. And we went all the way down. And we tried to build advocacy programs and ideas to support each one.

Nick:

And as you went from the top of the funnel or the top of the pyramid to the bottom, it went from a one to one relationship to a one to many. But we maintained this idea that even the bottom tier are still important advocates and ambassadors and marketers for us. There wasn't a moment where we're like, well, the line is done and everyone else is just a customer, and anything post-purchase is just going to be to try to get them to buy a new product. No, we didn't do that.

Nick:

So, we had a whole range of things that came to play. But this was one of the problems that I faced is, okay well, the one to one, I can do, the one to a few, I can do, but one to many, globally, how in the world can I do that? The only answer is with technology. The only answer is to have a tool or set of tools that help you build those relationships, and empower people. And give them the things that they need to then go do what you're asking them to do.

Brett:

Yeah. I love that. And sometimes, it makes sense to do the one to one or one to a few to your best customers going to be really active in referring and bringing business. And it totally makes sense to do that, and it's very valuable. But sometimes, that longer tail, that the one to many, you may get more total business from that. You need structure, you need tools, you need technology, to facilitate that and make it happen.

Nick:

Yeah. It's such an interesting point, because if you look at the world of influencer marketing, really... I find it fascinating how it came about with Instagram and Snapchat building these massive monthly active user bases, and then telling marketers like, middle finger, you can't advertise to our audience. And as marketers, we're like, that's cute, we'll just pay your users with huge following to advertise on behalf.

Nick:

And that's the start of influencer marketing as it is today. But it created this problem where we valued people with high reach over high credibility. And sure, there's examples, like, you get one of the Kardashians to post, you're going to drive top of funnel, and you're going to drive sales. You get LeBron to do something, it's full funnel. But for most, it's not. And it's why influencers don't want to be paid on an affiliate rate. Because they know they don't really drive sales. They want to be paid on a CPM rate. But it-

Brett:

it's usually influencers are more top of funnel, the more awareness.

Nick:

And use them for that. It's a great tool. I'm not saying don't use influencers for that, but it put us in this world where we valued reach over credibility. Because we could scale having a relationship with a few people with massive reach individually, as opposed to scaling a relationship with 1 million people who each only had 100 followers. Right? But they're collective reach, it's enormous, their credibility is a multiplier, for the most part, against your typical influencer.

Nick:

So, if you can find a way to grab that collective reach, and maintain credibility and authenticity, and all the other buzz words that we've been talking about for years, what you find is, increased conversion, deeper connection to customers, and a better sense of loyalty.

Brett:

Yeah. That's tremendous. Let's talk and let's dive into this idea of word of mouth and putting digital rails around it and all ties into the ambassador concept as well. I remember, I actually got my start in advertising selling radio ads while I was in college. So that was my first gig. I was 20 years old, working my way through college, selling radio ads to people way, way older than me.

Brett:

But I just remember it really stuck with me. It was imprinted on my brain early on. I'd walked into a restaurant or local shop and say, "Hey, what's your most effective form of advertising." And people would always say, word of mouth, word of mouth is the most effective, right? Invest in TV, any radio do whatever, but word of mouth is my go-to. And this was like in the year 2000.

Brett:

So this was early on, I'm dating myself, but this was early on. E-commerce was barely a thing then as well. But yeah, word of mouth, it's so valuable. No one would dispute that. But I think most people would say, hey, the only way I can influence that as a business owner, as a marketer, is just to create better products. Right? Just make good products that people want to talk about it.

Brett:

And certainly, that is a huge part of that. That is the most important part of it. If you don't have a good product, then nothing else can be matters. But talking about-

Nick:

Not that the big pens aren't great pens, but I'm not talking about them.

Brett:

Exactly. So how do you put digital rails around it? Go ahead layout what Wooly does to.

Nick:

Yeah. Well, Wooly has an interesting background there. I just have to say, I've heard, for years, the same things that you're talking about. And in a lot of ways, there's been so much evolution and progress made. But the conversations that you were having about word of mouth marketing, people are having the exact same conversations today. Which is crazy. People are like, yes, it's my best advertising method, but I have no real idea how to manage it better, other than better product.

Nick:

And 20 years later, we're saying the exact same thing. You know there's a problem if that's the case. We need sharper minds than mind really building products and thinking about that. But the goal of Wooly is to make it really easy for people to share the products they love with the people that they love. But because our background kind of came from this anti-influencer moment, we started on the B2B side.

Nick:

So we started by helping brands learn more about their existing customers. We're like, you don't know a whole lot about them, we have a platform that will help enrich the data around who they are. And at the time, candidly, Brett, we were like, we'll help you find influencers within your customer base that you just didn't know you worked with.

Nick:

Well, all of a sudden we started recognizing, Oh my gosh! We're looking at the data, we're the people, and we're like, there are some incredible people in here who are not typically what you would think of as influencers. Jesus! This is powerful. And then our clients started coming to us saying, thanks for the information, but now I need to do something with this. You're just telling me, here's a list of really important people, but help me build some tools to activate them so I can ask them, or so I can recognize them and say, I see you, we love you, will you do A, B or C for me?

Nick:

So we started building this out. And what we found was, the everyday customer, the person that has 500 followers on Instagram, not 50,000, was like, wait, my favorite brand sees me, and they recognize me, and they're like, and they're asking me to post about them on social media or share a discount with my friends and family, I'm in. And they started doing it in droves. It's been... The engagement and adoption rate of the everyday customer has been insane.

Nick:

And so we have brands now that just through the Wooly platform, just asking their customers, thank you, we see you, now here's a friends and family discount to share with your friend. We're not giving you anything in return, but if you want, you can hook up a friend.

Nick:

We're seeing brands that are selling 100K in a year extra. Gang Box, they sell dogs subscription toys, just sold an incremental 50 grand in subscription-based revenue in the first 45 days. It's blowing minds, right? What we're now realizing, and what we're building is, this is a great tool for the brands to have visibility into who their customers are, activate them to do more, and then measure the return. What we're seeing though is, wow, there's even more potential if we make it really easy for the end consumer to share any products they love with the people that they love. So we're building an app. We're building an app that essentially allows you to aggregate all of your products into this Wooly app. Brett, you and I are hanging out and we're having a barbecue at my house. This is a real story. Instead of you-

Brett:

This sounds ..

Nick:

This is a real story with my parents.

Brett:

For the record, you did not invite me to this barbecue at your house, but I appreciated the retelling. I'm there in spirits, so that's cool.

Nick:

Yeah, over Memorial Day weekend, I had my parents over, and I opened up the trigger and we smoked food. And it was one -

Brett:

Which is a fantastic barbecue grill? Pellet Grill, usually. Correct? This is Pellet Grill?

Nick:

Yes, Pellet Grill. And it does everything. It can act like an oven or... I mean, it does everything. They're so good. So I'm cooking on it, and my dad walks over, he's like, this is interesting. I haven't seen one of these before. And he eats the food and he's like, okay, I have to have this. Tell me. Well, I walked him through it. He ended up going and buying one. He bought it at ACE.

Nick:

Here's the problem with that story. I wasn't able to help my dad get it at a great deal. Traeger has no idea that I recommended that product to my dad. And Traeger has no idea that my dad bought the product. They know we sold one more unit at ACE. They have no insight into anything else that's happening.

Nick:

So, with the Wooly app, in that scenario, I would tell my dad, oh, you like it? Well, here, let me pull up in my app. I can share a link with you that gets you free shipping, or pellets for life for free, or 20% off, or whatever Traeger wants. Right? Here you go, dad. And then my dad receives that in his phone, and he clicks, and he buys direct. Or he buys through ACE. It doesn't matter. Right? Trader now knows, oh, Nick owns that product, he shared it with someone and that person bought it.

Nick:

If you start to understand that, let's say I do that 10 or 15 times in a year, Traeger may want to start treating me differently. They may want to start building different relationships with me. But from the consumer side, I just get to help my dad out. Which I'm doing anyways. Right? So that's the future of where Wooly is going. Is we are going to marry this B2B platform with the B2C side. And frankly, we already have some versions of that rolling out, but we're aggressively building towards that scenario, specifically, that I shared

Brett:

Love it. So you're getting insight, then into who your customers are, who's an influencer, who's referring, things like that. That's extremely valuable insight for the business to have. Also, you're making this word of mouth process easy then for customers.

Brett:

So if I'm already going to be talking about my grill and I'm going to be showing it off, when you do a cookout, the dudes hang out any way, you gather around the fire like in the caveman times. It's going to happen. And so now, you're maybe facilitating making that process easier. If someone does say, hey, I got to check this out, oh here, let me get you a discount. That type of thing.

Nick:

Yeah. It's kind of been a pain. Because the Traeger example, my dad ended up calling me. And he was like, okay, I'm at ACE, which one again did you say? Is there a better price somewhere? And I'm like, Dad-

Brett:

In don't know.

Nick:

.... I've got a hundred things going on, grabbed the guy at ACE. Or like, let me Google that for sort of thing.

Nick:

But all of that could have been removed with the Wooly app.

Brett:

Yup. Now, I'm sure some people are wondering, why don't you incentivize the refer? So in this scenario, why wouldn't Traeger give you a discount or a kickback or an affiliate commission or something like that/ I can think of several reasons to do that and several reasons not to do that. But what is your take, what are your thoughts why wouldn't that be set up that way?

Nick:

Well, that's a great question. And it's a question we're faced with a lot. And there's... We don't we understand the give and take on both sides. And we have people on our team who are pro one way or pro the other, but we're going to test our way in to figure it out. But I will tell you that I believe my stance is the high road. Which is, you don't give me the refer cash. Because, no offense, but none of us are looking to get on Facebook and see another LuLaRoe closet sale.

Nick:

I don't need that. Right? I don't want my neighbor just trying to make a buck off me. I'm not selling the Traeger to my dad, I'm recommending it. And if I can give him a discount, that kind of gives me some social clout with him, like, dad, remember I got you hooked up, you owned me one back. And I think it, it maintains a high level of authenticity, and it creates a high level of trust where there's no question like, wait, are you only trying to recommend this because you're going to make money on it? The other side-

Brett:

Nick, if you go back to what you said before but the credibility of some of these, they're not really influencers, they're just customers, but there's a lot of credibility there. If they're not getting a kickback that maintains their credibility, that builds their credibility. And a lot of those people want to feel credible. Right? I want to make a recommendation because I'm a nice guy. And I like to recommend things. And I want you to feel good about my recommendations. I don't want to make a recommendation because they get a small kickback. That almost takes away the good feeling. There's a lot of people that have that mindset. So, yeah ..

Nick:

Absolutely. And on the other side, you do that and then it's like, hey, give 25, get 25, We're both in it together, it makes the product maybe tricky-

Brett:

Go with ..

Nick:

... It might increase adoption and usability. So, there's a lot to be said about, well, if you can hook each other up, maybe it doesn't tear a credibility. So we're looking at every spectrum of like, nothing, it's totally pure, to all the way to yeah, absolutely, you get a commission rate or... And the truth probably lies somewhere in the middle where Purple Mattress is a client. And I think they do it really well. They're not going to give you another mattress. Because how many people need to king beds?

Nick:

But they're like, look, you do the things that we ask and enough of these things and we have this relationship, we'll give you free purple pillows. Well, there's like 50 or $60 pillows, maybe more. And that can be pretty cool too. So, brands are doing product exchange or, look, you can give your friends 20% off, but we're going to give you 40% off.

Nick:

There's some things that might be a middle ground there that don't compromise trust, but also create some stickiness for the end-user. Because if I'm a brand, conceptually, this is a really good idea, but if no one's using it, I don't care.

Brett:

Right. Yeah, exactly.

Nick:

So the brand can, at some capacity... Right now, they're looking at what the incentive is from a product standpoint. We don't facilitate payments today, and likely won't. But that could change. But they look at it and they're just like, okay, well, the discount that I'm giving or the product that I'm giving them for free, that just becomes my customer acquisition cost. It literally is a performance customer acquisition cost. It's not a maybe. It's, I only pay when I sell. And that can be really exciting for a brand. You cut through the noise

Brett:

For sure. And what's interesting, you talked about the B2B set up a little bit ago and probably some listeners here that are in the B2B set up. And one thing to keep in mind, if you have a client come to you through word of mouth, right? Let's just use the B2B space as an example. Someone who's referred to you, they're usually going to be some of the best clients to work with, right? They come in with a high degree of trust. They're going to take your advice. They're going to listen to you. The pry stick with you a long time.

Brett:

I think the same thing is true when it comes to B2C relationship. People that are referred to your business by your best customers, they are going to be like your best customers. Though they'll often become more of your best customers. So I think that's a real value as well, that you're getting potentially some of your best customers through this as well.

Nick:

That's such a good point. And I hadn't necessarily piece it together this way. But when you said that, my dad bought his grill, I went to his house and I helped him set it up. I went to his house and I was like, okay dad, here's how I use it. Here's how I'd recommend you use it. And then it was a couple of days later, I called him and I was like, dad, have you used the Traeger again? How is it? You have you done it on your own?

Brett:

You're like customer support here. You're like

Nick:

I'm customer support. I'm like, I'm fulfilling on their freaking customer journey post-purchase. It's insane how much it's not even that I think that I'm doing it for Traeger. Right? That's the beauty.

Brett:

Do it for your dad.

Nick:

I'm doing it for my dad. I'm not doing it for Traeger's. But they're the ones that are also reaping the benefits.

Brett:

For sure. This is all super fascinating, and I'm excited by it. So talk about what are some of the features of Wooly? And maybe do like a quick start-to-finish walk through of, hey, here's how we identify people, here's what we do after we identified people, here's where it goes. So talk us through that a little bit.

Nick:

Yeah. From a recruiting or understanding who your customers are, we have deep integrations with Shopify and other e-com platforms. We integrate with Facebook and Instagram. So there's a process where, at a point in time, we can pull social data from your users. We have the ability of kicking up IFrame, get to know you or application forms.

Nick:

And all of this information, from any source, is aggregated into Wooly. And then you're able to easily start segmenting and filtering it out. I was working with Cotopaxi yesterday. They have a half a million people in -

Brett:

Great brand. And there are some very passionate customers of Cotopaxi,

Nick:

Diehards. So we were looking and they have 500,000 people inside the Wooly platform that they can filter through the data. And we decided, okay, we're going to look at just anyone who's bought product in the last six months. We're going to look at anyone who has mentioned the brand on social media once. Has an engagement score of those posts on social above 3%. And has made a recommendation to a friend.

Nick:

The list, that fast, 107 people. We're like, okay, we're starting to find some powerful people. Notice, we didn't look at reach or follower count or any of that stuff. And then from there, we said, okay, well, what sort of things do you want them to do? And we built a campaign brief. And so this campaign brief goes out to those 107 people and says, we love you, thank you, here's something we're doing and we'd love it i you'd be a part of it, here's how it works.

Nick:

And then when those 107 people activate on their behalf, everything is tracked back into Wooly. And we can measure, of the 107, here's how many did everything, here's what that looks, here's the content that they created, here's how many sales it drove, here's the engagement rate on social. And so you're able to really quickly just look at it and make an understanding, high-level, of what's working and what's not.

Nick:

And then you can dig in to the individual level and say, wow, of the 107, Brett drove the most amount of sales. But you didn't post on social-

Brett:

For sure.. People trust me, yeah.

Nick:

This person didn't sell anything, but they post it on social and reach a 6% engagement rate with their 4,000 followers. That's pretty cool. So then you can start to further segment and build relationships with those people.

Brett:

Yeah, that's awesome. So then when you find someone, you mentioned the example earlier, hey, by the time you've sent me 10 or 12 new customers or something, I may want to think about a slightly different relationship. Maybe we then talk about commission structure or maybe now you're a beta tester for new products or whatever. What do those relationships look like once you find your best of your best ambassadors?

Nick:

Yeah. It starts to become more one-to-one. The beauty of Wooly is that it allows you to manage that one to many, that baseline. And you certainly can manage one-to-one. But at some point, what we see is a lot of these brands are like, okay, well now I've found tier one. Cotopaxi has multiple tiers, but tier one has, I think it's like 60 people. They have one-to-one relationships with all of them, and they use Wooly to manage the campaign and measurement. But the communication is like them.... I think they're even on a closed flack group. Nena and co. has a closed Facebook group. Love that.

Brett:

It's awesome.

Nick:

Marked, right? So it totally depends on how people want to manage those relationships and use it. You can do it in Wooly, but Wooly is really set to do more of the one to many or one to a few. Just because you want that personal touch when it becomes one-to-one.

Brett:

Yeah, you want it to be a direct email or a text or a slack or something like that. It just feels, at that point, one-to-one, it needs to feel a little bit different as well.

Nick:

Yeah. But you still can store all the data in Wooly to know these are my tier one and Y, or like, hey, this person went dark on us, they're not tier one and they're not tier two, but now they fit our tier three, let's move them down and treat them as such. So you can easily shift those things. And then that helps guide how you communicate and interact with them.

Brett:

Very cool. So a one last concept here, and then we'll talk about how people can learn more and discover all that Wooly has to offer. But you talk about campaigns. Can you just give an example of what one of those might look like?

Nick:

Yeah. Solomon... I just love this example.

Brett:

Ski boots and skis for those-

Nick:

And trail running shoes.

Brett:

Okay. Yeah.

Nick:

So they wanted to run a campaign that was not a direct sales attribution. But they went out and they just asked their customers, we are making a stance and we are supporting just awesome women. And we want you to do the same thing. And here's what the looks like. And we want you to share this on social media. Right? Without paying for an ad, without paying for a single influencer, they were able to generate 23 million impressions on social media through their customers with Wooly.

Brett:

Yeah. It's so cool. And then that's where you're talking to people that love you and are engaged. Your creating a message that's worthy, and that's timely, and that people can get behind and get excited about, and they wanted to share it. Right? And I love the way you explained it before. And I think I'm about to use the word love too many times in the same sentence if that's okay. I'll go..

Nick:

Go for it. I can handle it.

Brett:

It's, people that love your product is sharing price you love with the people you love. Right? And then this is like a message we love. Right? We really support that. So we put our share. That's awesome, man. Well, for those that are listening, that are having the same reaction as me, I've always just loved marketing and human behavior and how all this stuff ties together, and they're thinking, okay, I got to dig into this, I gotta think about this, where can they learn more about Wooly and how can they dip their toe in the water or get started?

Nick:

Yeah. Visit us at site at just wooly.com, W-O-O-L-Y. Or connect with us and our team on LinkedIn, @ScottPaul, @NickStagge @DanielFisher. We are happy to get on the call, to run you through a demo, to just learn about your business. But we think, if you have a brand that makes, to your point Brett, great products and people want to talk about it and share it, we have a platform that we are confident can deliver real results for you. So we'd love to connect and just become friends. And if we happen to become more than that, boy, that's pretty cool too.

Brett:

Yup. Awesome. Check it out. Put those digital rails around word of mouth. Start building a real ambassador program. Lots of growth. And this stuff is just fun too. It's just fun. Nick, this has been a delight at ton of fun here. Thanks for coming on. Thanks for sharing your wisdom and experience.

Nick:

Thanks for having me.

Brett:

Yeah. Glad to do it. So, as always, we'd love to hear from you, our listeners. Let us know what you want to hear more of, what topic ideas, what show suggestions do you have. Also, we'd love that feedback on iTunes. Leave us a review. Tell us what you love about the podcast. It helps other people discover the show as well. And with that, until next time. Thank you for listening.

Episode 126

:

Jon MacDonald - The Good

Increasing Conversions in the New Normal of eCommerce

I wanted to have Jon MacDonald come back on the show to talk about what’s working right now in terms of Conversion Rate Optimization.

Online shopping has shifted dramatically since the start of the pandemic. Some experts believe we’ve seen 5+ years of ecommerce growth condensed into just a few months. Attitudes towards quantities ordered, shipping rates and times, and pricing have ALL shifted from the norm. I wanted to have Jon MacDonald come back on the show (see his first appearance on the podcast for episode 60 ) to talk about what’s working right now in terms of Conversion Rate Optimization. We cover some truly fascinating subjects including:

How buying in bulk is a new trend - even if your marketing to non-peppers
How to structure new shopping options for buying in bulk to make the process easier on shoppers and easier on your fulfillment centers
3 ways to use SMS marketing to before, during and after the shopping experience to surprise and delight customers
Where you should start optimizing now including some key data points and quick wins with Google Analytics that you’re likely missing
How to quickly and inexpensively benefit from Heat Maps
Why taking care of your highest value customers is more important now than ever before

‍

Mentioned in this episode:

‍

Jon MacDonald - President and Founder at The Good

The Good - eCommerce Conversion Rate Optimization

Via Instagram

Via LinkedInundefined

The Good - Free Landing Page Assessment

The Good - Insights

Episode Transcript

Brett:

Hello and welcome to another edition of the eCommerce Evolution Podcast. I'm your host, Brett Curry, CEO of OMG Commerce. And today, we have a return guest. There are not that many return guests on the eCommerce Evolution Podcast. It's not because we're snooty. We just like to keep things fresh and relevant, talking about what's new and what's next. But it's very appropriate, very timely to have this guest back on.

Brett:

With me today, I'm thrilled to welcome back sir Jon MacDonald from The Good as a CRO expert. He speaks on stages back when that was allowed all over the country, at Google and other places, telling you how to optimize the shopping experience, the web experience for your customers. Eliminating all the bad, leaving only the good left. Yeah. We were just talking before we hit record. I think it was the last in person event probably any of us did was an event at the YouTube L.A. offices. He and I both spoke at that event. Our reps invited us to speak. I talked to YouTube. He talked to CROs. A fantastic event. It was like another lifetime ago though, pre-pandemic. Or pre-pandemic in the U.S. anyway. So anyway, with that Jon, welcome to the show, man. Thanks for coming on. And how's it going?

Jon MacDonald:

Thanks for having me. It's going great.

Brett:

Good, good. Yeah. It's really crazy times to be in eComm. For the most part, things are opening back up. You can actually shop in some parts of the country in physical stores. Here in Missouri, we're I'm located, we've been opened up for quite a while now. But we were just talking about the new normal, whatever that looks like. I heard someone say yesterday that the new abnormal. That may be the way to look at it. How is this going to impact the way we shop?

Brett:

And we were both speaking about how we're just grateful to be in eCommerce because in a lot of ways eCommerce is a beneficiary, all this madness, more people shopping online. So I wanted to today dig into how is online shopping changing, how do we think about CRO differently, where do we start optimizing now, how do we deal with some of the issues that we're facing right now. Like things going out of stock and some of the challenges that come from maybe too much eCommerce growth that we're dealing with. So lots of fun stuff to talk about.

Jon MacDonald:

Great.

Brett:

And excited to dive in. So just as a quick pulse check, how have things been going for you? You guys are likely been very busy for you lately.

Jon MacDonald:

Yeah, exactly. We're riding the wave as well. CRO has been around a while. And we've been doing this for 11 years. And it's been fun to watch the industry grow over that time. But nothing has propelled it forward like we've had over the past three, four months. And it's just as all revenue and commerce in general has went online, it's really helped brands fall into two camps.

Jon MacDonald:

Brands who are saying, "Okay. Let's take advantage of this opportunity and let's propel ourselves forward with the additional revenue." So they're reinvesting when they get that additional growth that they weren't really expecting. They're now turning that into a growth channel for them.

Jon MacDonald:

And then there's the secondary brands that maybe it's just exacerbating the challenges that they've had. The ROAS, the return on ad spend is really low. And they're not seeing the growth that a lot of their peers are maybe. And they're having a lot of consumer challenges on their website.

Jon MacDonald:

And so, they've been able to recognize that this is an opportunity they need to take advantage of as well. It's not because they have additional revenue. It's because they haven't seen the growth that they know is available to them. And so then they've come back to CRO as a way to help unlock that.

Brett:

Yeah. And just to share my love for CRO and what you guys do specifically, as a traffic guy and as a company owned eCommerce, we're 40 employees strong. But we focus on mainly paid traffic from Google Ads, YouTube Ads, Amazon Ads. We benefit greatly when the web experience is better, when there's someone like you and your team working with a client and making the shopping process easier, making the checkout process easier, increasing those conversion rates. Then we can spend more, grow more, do more on the traffic side. So really, a very complementary skillsets here that we're ..

Jon MacDonald:

I tell brands all the time, it's like adding fuel to a fire. If they're able to get that fire going through spending on ads and driving traffic, you know that you have product market fit, you know that you're able to turn up that dial. But then it's just adding fuel to that. Making it even more effective. Once you get those qualified people to your site, you want to make sure they turn into revenue.

Jon MacDonald:

And we can help, or conversion optimization can help do that at a great rate. And like you said, most traffic generation companies love it because they know they're sending qualified traffic. They're doing their job well. But then the site has holes in this leaky bucket that they're sending great water into and it just flows right through. And so being able to solve that problem is really beneficial.

Brett:

Yeah, totally. And when clients come to us with growth goals, they want to spend X amount on YouTube at scale, and if we can take their cost requisition and through on page optimization decrease that by 10, 15, 20%, it really can open up all kinds of additional traffic to it. So yeah, really excited to be digging in. I think a good place to start for us now is where do we begin to optimize? So maybe split it amongst those two camps we were just describing a minute ago, or maybe not. But where do we begin? If we're looking to optimize right now, where should we start?

Jon MacDonald:

Well, I think as traffic levels have greatly increased online, you need to make sure that you're capturing the data. Every click and movement of people that are interacting on your website. I'm not saying you do this on a individual level. Do it in aggregate so there's no privacy concerns. But having heat maps, click maps, scroll maps, making sure your analytics data is set up correctly so that you're capturing everything that's available to you.

Jon MacDonald:

There's so much rich data that if you aren't taking advantage of that right now, you're missing a huge opportunity to learn and to make data backed decisions. And so right now I think it's more important than ever that brands are really looking at the data that their site can be collecting. And if you're not, you're going to be left behind pretty quickly. But in addition to that-

Brett:

What are some basics you recommend there? As an example, we work with some decent size brands. We're actually working with one that's pretty large and grown like crazy. They did not have Enhanced Ecommerce turned on in Google Analytics. So we helped them get that turned on so we could get more deeper, richer data. But you have a checklist of sorts? I know this is a little bit on the fly. But to make sure we have that data, what are the must have data points that you recommend?

Jon MacDonald:

Yeah. Well, you called out a huge one. And we see that issue... We've worked with brands doing 50, 100 million that have not had that turned on. And it's like you paid for Analytics 360 and you don't have that one button turned on that just gives you so much more data. It's interesting.

Jon MacDonald:

I think some brands are so focused on the marketing aspects of it that they're not paying attention to the deep dive of the data that they could. They're really focused on those inbound metrics. I might call some of them vanity metrics more than anything else because they're not really moving the needle that much. They're just looking good on a report that a marketing person might give up the chain.

Jon MacDonald:

But I think in addition to analytics, you should be doing a few things within analytics itself. You should be annotating. So it's real easy to just annotate every email that you send out whenever you start a new campaign or a new sale. Something of that sort. Just annotate it in Google Analytics. That will tell you as you look back year over year, or even a quarter from now.

Jon MacDonald:

You're not going to remember in three months what date you sent that really great email on. And you're going to look back in Analytics and see an uptick in the charts but you're not going to know what caused it. And so having annotations can be really beneficial for seeing trends.

Brett:

Yeah. And that's so huge just to chime in on that. Especially if you have multiple teams working on your business, which most eCommerce companies do. So we say it all the time, we're brought in to analyze, do a traffic audit, Google Ads audit. Things like that. We'll dig into Google Analytics. We're like, "Whoa. What happened here?" And literally it's like 1 out of 80 or something actually have annotations. So nobody does. And so you then you ask the client, "Hey. Well, what happened here?" "I don't remember. Let me go and ask this person." That's where, yeah, that's a simple thing. But it can inform your various teams, you could make better decisions. It's one of those real easy pretty quick wins.

Jon MacDonald:

Agreed. I think that if you're not doing that then you're leaving a lot on the table. Some other things to be thinking about here. I mentioned heat maps, click maps, scroll maps. Just user engagement data. How are people engaging with your site, what content they're interacting with, sometimes more importantly what content they're not interacting with.

Jon MacDonald:

We love a tool called Hotjar. Really inexpensive. Great tool set. Allows you to collect heat maps based on mouse movement and touch maps based on mobile. As well as scroll maps to tell you how far down the page people are scrolling and what content they're missing because it's too far down and maybe you need to reorder some of that.

Jon MacDonald:

You can also do session recordings. So you can see anonymous data of how people are engaging with your site. Whether they're scrolling all the way down to see if they're missing anything then coming back up or what they're looking at on a day-to-day basis. You can even do it across sessions with the same user. So you can see if they did their research and then they came back to the site a second time later. So you can collect some really good data there.

Jon MacDonald:

In addition to that, we collect eye tracking heat maps which adds just a whole nother layer on top of that data. Most heat maps are done based on mouse movement. But eye tracking really gives you a second look at where are people actually looking at on these pages. Usually on desktop, your eye is following your mouse cursor. But more and more, as people are getting used to iPads and iPhones and those type of engagements where they're not used to following a cursor anymore.

Brett:

Yeah. A lot of people are not following along with their finger. You're just looking. And so interesting. What service do you use for the visual heat map?

Jon MacDonald:

For eye tracking.

Brett:

Eye tracking. Yeah, yeah.

Jon MacDonald:

Yeah. So we have a tool, a proprietary tool that we own that we've built up. And we do it via AI. So we have an algorithm that we purchased a while back that is based into a tool and it allows us to basically upload a URL or website and then collect eye tracking heat maps based on artificial intelligence.

Jon MacDonald:

And so it's a data set based on an algorithm that's based off of real eye tracking studies. And we check that about every six months to make sure that the algorithm is not morphing in a way that's leading us astray. And it's only getting better. I've been shocked.

Jon MacDonald:

And I think AI in terms of what's going to happen with conversion optimization, it's going to be the next wave of conversion optimization because there's so much... right now, it could take months to collect these statistically relevant data to make data backed decisions. But with AI, we're able to get that eye tracking heat map in 10 seconds.

Brett:

Wow, wow.

Jon MacDonald:

It's a completely game changer for us.

Brett:

That's fantastic. So is that something you offer as a standalone service? Or is that something that you do currently as part of package? Or how does that work?

Jon MacDonald:

Yeah. So it's something we've kept in for just our clients at this point. That originally started because we really wanted to make sure AI, the algorithms and everything, were going to work really well.

Jon MacDonald:

And then over the last couple of years it's just been a competitive advantage for us more than anything else. So we haven't done that. It's been a discussion, especially over the past couple of months as more and more people are starting to open eCommerce shops but don't have budgets to work with us. And so that's fine. We want to make sure we're helping that.

Jon MacDonald:

Again, our mission is to remove all of those bad online experiences until only the good ones remain. It's going to be really hard to see that mission through at our price point where we do the customized consulting. So being able to bring that down and offer that as a tool at a price point that any brand can afford I think will be something where it's on our short-term roadmap.

Brett:

Yeah. I think it'll be phenomenal. I think it will also be, just as a side note, great prospecting tool. People use that. People see that. They think, "Whoa. This is amazing. I don't want to do any of these changes. Let me hire The Good to help me execute." I want to talk a little bit about traditional heat maps for a second. What are some of the usual takeaways there? And for someone that maybe is not dug into a heat map, so they haven't installed Hotjar before, they've not used it, what should they be looking for? And where are there usually some quick wins once you install a heat map?

Jon MacDonald:

Yeah. So what we're really looking for, again, is how people are engaging with the site. And I say this all the time, but it's really hard to read the label from inside the jar. What I mean by this is as an eComm manager, somebody who works on this site, you have a hard time understanding how people are engaging with your site.

Jon MacDonald:

And so what a heat map is going to tell you is real data on whether or not people are clicking on... if you're looking at click heat map. They're actually clicking on something. Or maybe they're doing rage clicking where which I what a call when people are trying to click on something that's not a link. And then they're like, "Why is this not working?" And they just keep clicking.

Brett:

"It should be clickable. I'm just going to keep going for it."

Jon MacDonald:

Right, yeah. Maybe that will magically make it clickable. But it's interesting. We see that all the time. Big one is if you have social proof on your site in terms of a logo from a news publication or something that's pretty big. It's popular for especially beauty brands. A lot of them will list all of these high end magazines that they've been featured in. Things of that sort. Consumers try to click on those logos because they want to go see what was said about them.

Brett:

Right, right.

Jon MacDonald:

And a lot of brands don't have that option. And I wouldn't say ..

Brett:

Some brands put a logo of a popular magazine where they ran a small ad in that magazine. And that's why I don't...

Jon MacDonald:

I think consumers are onto that, right?

Jon MacDonald:

And that's why they're like, "Show me the proof. Can I see the logo?"

Brett:

Show me this article. Let me see how you were featured in Allure magazine, or whatever.

Jon MacDonald:

Yeah, yeah. It's definitely a trick of the trade that people try to do. And I think consumers are onto that type of stuff. And so they see social proof on a site anymore but they want what backs that up.

Brett:

Yeah, yeah. Awesome. Have you seen shifts in behavior since the pandemic? Other than just more shopping online. And I will add a few notes to what we talked about before. We've seen eCommerce has a percentage of total commerce growth from... These are Forester numbers. But from 16% to almost 30% of total commerce going to eCommerce. I've seen some studies showing... Actually, I think it Forester was 25%. But the studies show in the 30s. Likely a lot of that's going to continue. Some of it will go back to physical stores. But any other behavioral shifts or things... Maybe that's the first time eCommerce shoppers on that are doing things differently. Just any other behavioral shifts that you've seen recently.

Jon MacDonald:

Yes. Buying in bulk. We've seen a lot of brands who we've run simple tests. We started noticing this early on when there was lot of panic buying, perhaps. Maybe the prepper community, I don't know. But we started noticing it with a few brands we were working with. Where they were noticing people stock up and fill up their cart with a whole... We worked with one brand that does a type of beef jerky. And it's all natural, healthy beef jerky. None of the additives and anything. And what we noticed was two weeks into the pandemic, everybody was buying six, seven hundred dollars worth of jerky because it's shelf stable for years.

Brett:

Yeah, yeah, yeah, yeah, yeah. And my guess is a lot of them are probably non-preppers. Just people saying, "I'll just feel better if I got a little bit of a stock."

Jon MacDonald:

Yeah, perhaps. And so we leaned into it. We said, "Hey. These people are noticing these orders where they're ordering four of this product and five of that product, and all different sizes. And they're just trying to build their own variety box." And the problem with that was then you have your fulfillment center having to run all over the fulfillment center grabbing one of this, two of that, five of this, and fill it up. So it's really resource intensive to do that.

Brett:

What changes now? And these are going to persist as well. Where you've health and safety regulations now in your pick, pack and ship departments. Whether that's in-house or 3PL or whatever. And so how do you make things easier for the pick packing shippers?

Jon MacDonald:

Exactly, exactly. 100%. I think that that's a key that people need to be paying attention to. But what we did is we leaned into this bulk order and we said, "Okay. Let's put together what we call a pantry box. And just offer different sizes of boxes based on the amount that you could do." So we have a $250 box, a 500 box, a 750, 1,000 box. I think we went up. We just kept adding because people kept buying. I think we ended up with a $2500 box maybe of jerky. That's a lot of jerky. 100 pounds of jerky or something.

Brett:

Never would've happened pre-pandemic, I wouldn't think. Once in a blue moon.

Jon MacDonald:

No. But I think all different types of brands. Your jerky's a pretty obvious one because it's shelf stable. But we found it with a lot of brands where average order values were going way up. And if you're not taking advantage of that, you're really doing yourself a disservice. And now, they've got a whole new product line that does extremely well for them and these pantry boxes. Average order values have just continued to go up because more people were saying, "Oh, well. It's kind of a pain in the butt to have to put $250 of product in my cart and search through everything. I'll just take the best of kit and the pantry box that you think I should try."

Brett:

Awesome. What a good insight. So quantities that people are ordering are going up. So two things to keep in mind there. We touched on it, but just to highlight them again. How do you make the shopping easier, the principle of the value meals at fast food restaurants where part of that working which is people being able to say, "I just want number one. I could look at all these, I could combine things. But just number one. That's all I want."

Jon MacDonald:

The simplicity.

Brett:

Simplicity. Exactly. So making it simple, making it easier for the shopper, but also easier for you to fulfill. So if you can combine those two things, man, those are real wins.

Jon MacDonald:

Yeah. Increase your margins and your average value and you've got a real exponential growth opportunity.

Brett:

Yeah. Awesome. Any other shopping trends, behavioral trends that you've seen that have either come directly from the pandemic or maybe they've been happening anyway and you're seeing them now?

Jon MacDonald:

Yeah. Less of a concern about free shipping. And maybe that's not the right way to put it. Less of a concern about quick shipping that is free. Let's put it that way. Consumers still want free shipping. It's a value they've been trained. They're not willing to give that up. I think that that still should be an option.

Jon MacDonald:

There's a lot of tools out there right now that can help you take advantage of that. That can do things like where I've noticed this a lot on Google lately where they have the free two-day shipping badges. And it's really only for people who are within a two-day shipping range based on standard shipping.

Jon MacDonald:

So Google knows your location when you're doing the search. And if you're within a zip code perhaps that is within two-day range of that product, then it will put the free two-day shipping badge up there. Great option. But what it is, is consumers still want that free shipping but they're willing to wait for the product.

Jon MacDonald:

I think people are getting more reasonable about that. And that's been a good trend and good shift for most brands. A part of that, I think, was led by Amazon not being able to fulfill everything for two days for three months.

Brett:

We saw this a lot. So we have a lot of clients that sew on Amazon and off Amazon. We've typically been managing their Amazon ads, and then YouTube, and Google and stuff. What we saw with a few clients, once Amazon said, "Hey. We're delaying shipments of all non-essentials," we saw search volume go up on their .com sites for product and two-day shipping. Or even their search query report in Google Ads, people searching for their product and two-day shipping. Like, "Well, I can't get it for three weeks says Amazon. So now I'll go and I don't mind pay a little bit in shipping."

Brett:

I think you're 100% right. People have gotten a little more realistic about, "Hey. I'm just happy to get this product at this moment. And so I'll endure a little bit longer ship time or pay a little bit." I do think we're creatures of habit. We have short memories so likely we'll get back to... I don't think you can take that lesson and say, "Oh, cool. Just charge a lot for shipping and it'll all be fine forever." Probably not. Maybe in some cases. People get used to that free shipping again. But for now, you got a little bit of a ..

Jon MacDonald:

And again, we've still seen this trend continue where you need to have a free shipping option. But it could be a five-day option and people will be okay with that. A two-week option might be a problem. But a five-day option, not a problem. And then allow them to pay the difference to get if they need it overnight or two days.

Brett:

Love that.

Jon MacDonald:

People are okay with that. And I think that's where it's become a little more reasonable.

Brett:

Cool. Any surprise optimizations or changes? I think that the quantity stuff we just talked about was super interesting. But any other wins or optimizations like that that you've seen working recently?

Jon MacDonald:

SMS has really been working well. Text options, we've seen that just skyrocket in the past few months.

Brett:

And where are you seeing the SMS options inserted? So pre-purchase? Or during the checkout process? How's that being used?

Jon MacDonald:

In three different places, actually. We've had a lot of success testing. The first is pre-purchase where instead of signing up for emails, if you really are engaged with a brand, you're going to buy in the short-term, a lot of people will put in their text message. Or get a text message and put it in their cell phone. And there's a lot less spam happening there and they know that it's more regulated right now. And they can just reply "stop" and stop it at any time. So generally that's pretty good.

Jon MacDonald:

We're seeing huge conversion rates on SMS right now, which is great. And then in checkout, we're seeing a ton of people provide their phone number as a way to get shipping updates. Because they can't go anywhere. They're home. They're waiting for that product. They know it's going to be a delayed shipping, perhaps. So they really want to stay up to date on it. So we're seeing that. And I don't know if you saw Shopify did. Brought in their new app.

Brett:

Got the app.

Jon MacDonald:

Yeah.

Brett:

It's pretty cool.

Jon MacDonald:

Yeah, it's great. It's really based around having all your orders in one place and being able to track those. And they used to have something, I think they called it Arrive. And they brought it into shop. So we're seeing a lot of people take advantage of that, which is great. And you build out a richer profile so now you have that text message opportunity when you run a flash sale or you want to just really slice and target your audience of shoppers. You can go to your highest profile, best customers with the best lifetime value, and say, "Here's a special deal just for you," and send them a text. Most people are going to be okay with that as long as you don't abuse it.

Brett:

And I think one thing to chime in on the value of getting text updates on shipping and things like that. And then one of the values of the shop app. And I think Chuck has some pretty big plans for that app. Even on the product discovery side and some other things on the roadmap. But there's just something about... and especially if experience times where shipments are delayed. So in the heat of the lockdowns when everything was being ordered online and things really slowed down, just getting those updates makes a big difference.

Brett:

I think if you make a quick offline comparison of... Think about the times you go into a restaurant and there's a bit of a wait, the table is a bit of a wait, and no one comes by to say anything to you. It feels like an eternity. It feels like you've been forgotten. It just feels awful.

Brett:

Where someone just checks in with you. Just says, "Hey. We've got this coming up. It's going to be just a few more minutes." Just giving you updates, caring for you a little bit, it changes the whole experience. You still maybe got your meal at the same time. You still maybe got your product at the same time. But just that check in removes anxiety and just improves ..

Jon MacDonald:

And there's good opportunity there to build more brand awareness. Let them know about, "You bought this product. Here's something you might like." Or even along those lines of, "You just bought this product. Here is the manual for this technical product that you should really check out. Here's a quick start." Something like that.

Jon MacDonald:

I have a three and a half, four-year-old at home. And we bought him a bike and it came back with... We ordered it. Got an email a couple days later. It said, "Hey. We processed and shipped it. Just want to make sure you know that there's some assembly required. Here's the tools you're going to need and here's the one sheet instructions. And if you have any questions, you can ask us now before the bike arrives."

Jon MacDonald:

And it was awesome. I've never seen anyone do that before and I was shocked. I was like, "Why has nobody done this?" It's so simple. It just makes me feel even more like the brand cares for me, they're looking at for me, and they've made my life more simple. And they know I have a kid at home and I don't have a lot of time to put a bike together. And so it works out really well for everybody.

Brett:

Yeah. And it made that process then once you got the bike, your enjoyment of it was a lot better. Because, A, you knew you were going to have to put some stuff together. B, you knew what to do already. So it just made that arrival time more fun. Because we also had that experience, at least for guys like me because I'm actually not that good at building stuff and putting stuff together. I build companies. Can't build furniture.

Jon MacDonald:

Very different skillset.

Brett:

It's like you get home and you're so excited about it. And you're like, "Oh, crap. I need help." And so then you're almost disappointed because of the work that you have to do. But if you know what you're going to have to do and how to do it, now the whole experience is better. But such a simple thing. And you're right, nobody does that.

Jon MacDonald:

Yeah, yeah. And so the third in terms of what most of us are seeing, a lot of adoption is post-purchase. And what I mean by that is like subscription products. It's working extremely well to say, "Hey. It's been a month. You're probably out of the product. Do you want a refill?" And one brand that does this really well is Hydrant. I don't know if you're familiar with them, but they are a powder that is basically powdered Gatorade. They probably would hate me for saying that. But you put it in water.

Brett:

Mental picture what that is, right?

Jon MacDonald:

Yeah, right.

Brett:

Way better than Gatorade, I'm sure. It says Hydrant.

Jon MacDonald:

It doesn't have any of the coloring or any of the other stuff in it. And I love it. It's super hydrating. It has ingredients in it that help your body absorb the water instead of just passing it through. And so it came out of the Philadelphia 76ers Innovation Lab in the NBA.

Brett:

Nice.

Jon MacDonald:

Which is really cool.

Brett:

No idea that existed, and I'm an NBA guy.

Jon MacDonald:

.. before this. Yeah, yeah. And so really interesting there. I've subscribed to their products. And I get a text message every month that says, "Hey. It's been a month. Are you running low?" And then it's like, "Yes or no?" I just, "Yes." "Would you like us to send you another order of your same order?" "Yes." "Charged your card ending in these four numbers. You're good to go. Will be there in X amount of time." That's all you have to do.

Brett:

Let me try and understand this. So you're already subscribing?

Jon MacDonald:

Mm-hmm (affirmative).

Brett:

But it's asking you if you need extra? Just in case.

Jon MacDonald:

Yeah. So the way that-

Brett:

.. that buffer. Or that extra product.

Jon MacDonald:

Definitely that. But the way that they do it is they send you an email notification about a week before it would ship. And so this text comes about the same time. And you can pause or you can delay. And if you say, "I don't need more right now," it says, "Would you like us to remind you in two weeks?" And so you have these options like that that are really great. And it's still convenient, right?

Brett:

Yeah, yeah, yeah. I think they could work... So give you an example. I'm a fan of Magic Spoon. So it's an ungrain, Keto friendly... I'm not on a Keto diet. But Keto friendly, protein-rich cereal. I love cereal. I could eat cereal all the time. But I mainly quit because I'm getting 40-years-old. I don't want to get fat. Things like that.

Jon MacDonald:

Because the sugar, yeah.

Brett:

Yeah, tons of sugar and stuff. So I subscribed to Magic Spoon. It's fantastic. Now some of my kids like to eat it so I get a four pack and maybe an eight pack that I get once a month. But I sometimes will still run low. I've gone and bought another four pack a couple times. But if they were to text me, if they would check in with me and say, "Hey, are you getting low," I guarantee you I would order more through that. So that's a really smart feature. What tools do you recommend for SMS messaging or do you guys have a proprietary tool for that?

Jon MacDonald:

We don't have a propietary tool. We generally use third party tool sets for that. Klaviyo has some really good stuff built in now with SMS. Privy came up with a great SMS tool. There's several others out there. The industry has just blown up recently. But it's something to definitely check out. Based on your market and automation platform and what you're also doing because you want it to integrate with your CRM. And so that's going to be the big key there. Most of those automation workflows need to be set up through your CRM.

Brett:

Yeah, because when it is set up through CRM now you know something about the customer. You can do a really relevant text message. Because nothing will get an unsubscribe quicker, get that stop message your way than an irrelevant text.

Jon MacDonald:

Yeah, exactly.

Brett:

That's awesome. Let's talk about how to deal with out of stock products. I think this is mostly getting better for a lot of companies. Factories are back online in China, for sure. Mostly in other parts of the world as well. But still, inventory issues could be the norm for at least a certain percentage of SKUs for a while. What are some recommendations you have for dealing with out of stock products?

Jon MacDonald:

Well, I think we saw this really horrible... I don't know how to better put it. There's no way to sugarcoat it. This really bad trend of people just deleting their product detail pages when the product was out of stock. And I couldn't believe it. I was like, "Why would you... You're ruining your SEO. All this effort you've put in. And then maybe you still have some rogue ads you're running, or if you didn't tell your ads partner."

Jon MacDonald:

There's just so many bad things they can come up this. Not alone just the opportunity to continue to sell by collecting an email address or even a phone number, like we just talked about too. Really just let people know it's back in stock. And I think it's going to be really important to make it feel like a special experience. Sign up to be notified. Join the wait list. But there's ways to do it where it more feels like you're joining a club.

Jon MacDonald:

And I think that's really important; is to make feel special. They're going to be the first to know. We work with a brand called Snow Peak. And they're a Japanese camping brand, really high end luxury equipment. And it's really interesting because we put this up on the site just to be the first to know because they kept selling out of products. They'd do limited runs. They would sell out and then people come to the site and couldn't get the products. They'd be upset.

Jon MacDonald:

So what we did is we used it to help build a case for when they should reorder. And then we said, "You'll be the first to know when it comes back in." Well, it got so popular what kept happening was people were signing up for this, they would sell out the next batch they ordered before they could even put it back up on the site. So now it became a whole thing where if you wanted these products, that was the only way to get it. And consumers started to recognize that.

Brett:

Bringing people to really be on the ball, and be notified, and then take action quickly.

Jon MacDonald:

Yeah. Yeah, and it worked out really, really well for them. But I think brands also need to be really clear about when things are coming back in stock. So I've had a horrible experience lately with B&H Photo. I'll just call them out. I was hesitant to do it, but they're a big company. I'll call them out. B&H Photo. Ordered some equipment. I've been doing these podcast interviews three or four a week now. And so I wanted a couple of different cameras set ups and light set ups and stuff. Get some quality up there. Ordered a couple set ups from them. And one of the products has been back ordered for 60 days now.

Brett:

Wow.

Jon MacDonald:

And they keep emailing me, "Hey. It's coming back in stock next week. We'll let you know when it ships." And then, I'm like, "Okay. Great. I'll wait another week. And then I get an email that whenever it's supposed to ship, "Wanted to let you know the product's still out of stock. We don't know when it's coming back yet." And so it just becomes really, really frustrating time and again. This is top of mind because I literally just checked Amazon today. The products are there and they're going to ship in three weeks. And I said, "At least I know Amazon isn't going to mess with me on that."

Brett:

Yep, yep.

Jon MacDonald:

So I canceled my order at B&H and I just ordered it off Amazon. And Amazon's even been giving me specific dates it's going to come in right when I ordered it.

Brett:

Amazon hits those too. Amazon, if anything, they're going to be early. But they've got their logistics down. Or if they give you a date or day range, you're going to get it.

Jon MacDonald:

Yeah, and I feel like you get product before a lot of other people because of their volume. But it's just one of those things where if you are not very clear about the expected return date, you're going to have problems. So that's something to think about there. And then it's a good opportunity as well to share related products, of course. So if you like this product and it's out of stock, maybe you like this other product. I think a lot of brands aren't doing that. It's such an easy win. It could be almost anything. Short sleeve shirt over that long sleeve shirt that you were going to buy. Any of that kind of stuff.

Brett:

Maybe it's the upgraded version of the product you're looking at, or the downgraded version. Or, "Hey. Need it fast? Get upgraded this product and here's a discount." We have an automotive client. They sell different automotive accessories. And a lot of what they have is good, better, best with a similar product. And so they were running out of the mid grade, the better that's usually .. So they're running out of stock of that and it's going to be a little while. So they're pushing the best, but with a slight discount. Saying, "Hey. Right now we're giving you a discount on the best."

Brett:

So yeah, I think just shifting the way you present it. And I love the example of the Japanese outdoor product company. Where, "Hey. Be the first to know." And then if you train customers, you totally turn that into a win. We see that with a skincare brand we work with and several others where you can get customers to really .. So we've got a client with a beard product company. And when they launch a new product, they sell out every time. Every single time. They designed it that, or they want that to happen, which is a good thing. And then you train people to be like, "Hey. As soon as I get the notification of the watch, I'm buying so that I get the product."

Jon MacDonald:

Yeah, that's great.

Brett:

Yeah. I want to underscore, we said too about deleting product detail page. Hopefully people listening are not doing that. Remember back in the day we used to do a lot of SEO consulting. We sold that side of our business just because everything else was growing so fast. But I worked with this large dress seller and they would delete. That's what they would do.

Brett:

They would just delete because they would get frustrated clients clicking on a dress that was out of stock. And they didn't realize they were getting a ton of visitors from Google images. They were also images. But that's the way a lot of people shop for dresses. And there's some too where people will find the product in Google images and then end up at your site.

Brett:

So they were seeing this just steady decline in SEO traffic, and we identified it. It's like, "Hey. It's because of these images and these queries. Let's get these images back up. Let's get these product detail pages back up, shift them to a new product." Lots of stuff to consider there as well. That's fantastic. Any other CRO tips that you would give that are just super relevant for right now?

Jon MacDonald:

Man, we've covered a lot, haven't we?

Brett:

We've covered a lot, man. Fantastic, yeah.

Jon MacDonald:

I think that right now it's really I think just focusing on your highest value customers is really going to be key. Don't forget the people who've been loyal to you for years, that have huge customer lifetime values. Make them feel special right now because the worst thing that you could possibly do is take a brand advocate like that at a time like this and ship something to a brand new customer first. And then you end up losing that lifetime customer.

Brett:

Possibly.

Jon MacDonald:

So really make sure that you're focusing on that. We've been preaching that with our clients. And again, that's where the more information you have in your CRM, the better off you can be in those situations.

Brett:

Love that, love that. Jon MacDonald, delivering the goods. Unintended on that. But this has been fantastic. Really appreciate it. Jon, where can people learn more about you and about The Good? And also, you got some resources, man. You guys got some fantastic articles and resources. So how can people learn more?

Jon MacDonald:

Thank you. Yeah, thegood.com. T-H-E G-O-O-D.com is where you can learn more about The Good and sign up for our insights. If you just click on insights in the top navigation, you can sign up to get our weekly email there where you're the first to hear about new articles that we write. It's never a sales pitch. It's just helpful content each month, as you mentioned. And if want to get ahold of me, just email me directly. I try to read every email. It's Jon, J-O-N, @thegood.com.

Brett:

Awesome. I will link to all of that in the show notes as well. So you can check that out at omgcommerce.come and look at the blog section. So you can check it out there. Or you can also Google Jon. You'll find him. J-O-N MacDonald, M-A-C-D-O-N-A-L-D. So check that out. Jon, man, this has been awesome. Thank you so much for taking the time. Really, really enjoyed it.

Jon MacDonald:

Thanks for having me. It was a great chat.

Brett:

Yep, absolutely. So as always, we'd love to hear from you. As a listener, what would you like to hear more of? What topics, suggestions would you like to hear less of? We'll take that as well. And also, love that review on iTunes. That helps with people find the show, makes me feel good, lets me know that you love the show and love what we're doing. And so we love that iTunes review as well. With that, until next time. Thank you.

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Episode 125

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Ryan McKenzie - Tru Earth

Selling Product Subscriptions and Understanding the Power of Villains in Marketing

Learn how Tru Earth is disrupting the laundry detergent space by selling subscriptions and understanding the power of villains in marketing.

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Learn how Tru Earth is disrupting the laundry detergent space by selling subscriptions and understanding the power of villains in marketing. My guest in this episode, Ryan McKenzie is a marketing and eComm wiz. He built his first online business in his 20s and after some extreme wins and some humbling losses, he found his eComm game. In this episode we uncover some of Tru Earth’s keys to success including

3 types of offers that get shoppers to subscribe to auto replenishment.
How to structure pricing and discounts for subscriptions
Blair Warren’s amazing 4 keys to persuasion (literally one the best marketing quotes I’ve ever heard) and how to leverage it for your business
How finding a “villain” can make your marketing more powerful and help you build a closer community (hint: villains don’t have to be people)
How to approach ad fatigue and new creative development for Facebook
How OMG Commerce is helping Tru Earth leverage Google Shopping and YouTub ads
Plus more!

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Mentioned in this episode:

Blue Ribbon Mastermind

“Building a StoryBrand” Book by Donald Miller

The One Sentence Persuasion Course by Blair Warren

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Ryan McKenzie - Co-Founder at Tru Earth

Tru Earth - Eco-Friendly Laundry Detergent Sheets

Episode Transcript

Brett Curry:

Well, hello and welcome to another edition of the eCommerce Evolution Podcast, I'm your host Brett Curry CEO of OMG Commerce. And today, I've got a friend joining me on the podcast. This is a dude that I respect and admire, and I've got to see his business explode in recent years. We actually met through a mutual good friend of ours Ezra Firestone. We're both part of Ezra's Blue Ribbon Mastermind.

Brett Curry:

So today you're going to be getting the inside scoop, the story from my buddy Ryan McKenzie, co-founder of Tru Earth. You'll hear all about Tru Earth and the innovation. If you were watching the video you just saw a flash of the Tru Earth product. We're going to get into that into some marketing tactics, some brands storytelling. Ryan has an amazing marketing mind and some amazing marketing skills. We're going to talk about some of those fun things today and get to hear his story. With that Ryan McKenzie, how you doing man? Thanks for coming on the show.

Ryan Mckenzie:

I'm good man. Thanks for having me. It's always nice to see your face even if it's not in person, you know?

Brett Curry:

Yeah dude, I appreciate that. We were talking about how we're both pretty young guys where in our own heads maybe we're getting a little gray.

Ryan Mckenzie:

And really good looking, really good looking.

Brett Curry:

Very attractive more than above average whatever. That's what we tell ourselves. But yeah getting a little bit of salt and pepper going on here so I guess, I don't know if that's a good thing or bad thing but it's real, it's happening. So yeah, man. We're going to mainly focus on Tru Earth through your e-commerce business and how it's been exploding and the innovative things you guys are doing. But you have a really interesting background in direct marketing, and media, and magazines, and subscription box all kinds of crazy stuff. Can you give us the 90-second rundown of how Ryan McKenzie became a marketing superstar and then we'll dig in into Tru Earth.

Ryan Mckenzie:

Overnight marketing superstar 20 years in the making. I started messing around on the internet in the late 90s and I've always been super entrepreneurial. One of our business partners, Kevin Hinton and I have been friends since kindergarten and we've literally been scheming in some form or another since probably kindergarten. We were doing lemonade stands and trying to sell bracelets and all sorts of stuff like that. Then the internet started becoming mainstream in the 90s and we went from trying to make an application, or an app, or software back then for bike trails. We were doing websites and trying to sell ads. Then we had a media company and we're doing a huge email list of like a million subscribers in the early 2000s. We were doing newsletter ads, CPC stuff. Then we got-

Brett Curry:

Have you always been in Vancouver?

Ryan Mckenzie:

Yeah. I've always been in... Oh, I actually only lived in Vancouver for probably a year of my entire life but the rest of it has primarily been in a suburb 20 minutes from Vancouver.

Brett Curry:

That explains the bike trail angle lots of hiking, lots of outdoors.

Ryan Mckenzie:

Yeah. I'm literally looking at mountains and the ocean or an inlet to the ocean from where I'm sitting right now. Vancouver is wild. We started doing well in selling advertising using networks, not actually direct sales. Then getting into the affiliate side of things. That led... I felt we had a ringtone subscription service for a while started as affiliate, then we had a service and then that got shut down. Then Kevin and I built this platform called InfoBarrel which it's still alive but-

Brett Curry:

What's it called again? Info brow?

Ryan Mckenzie:

InfoBarrel.

Brett Curry:

Barrel, okay.

Ryan Mckenzie:

It was really big in the article marketing days, but sorry.

Brett Curry:

Dude I remember those days. Article marketing that's actually, quick side note quick history on the host here. That's how I got started online marketing as an SEO and my first claim to fame an SEO is I got a client of mine to rank the top 10 for the search term brochures and all I used was article marketing. That ranking did not last.

Ryan Mckenzie:

It was real man.

Brett Curry:

Well, for a while it was legit.

Ryan Mckenzie:

Yeah, like 2006 to probably 2010 that was a really great way to rank for things. I actually had an SEO agency in that time frame too because that tactic was amazing. But anyways, we launched this site InfoBarrel. This platform was like a Squidoo or HubPages and we shared 75% of the revenue with our users. It got big. There was something like eight million searches a month at some point. Then Panda and Penguin all those Google updates hit and kicked our ass all the way back to-

Brett Curry:

That was gnarly man. Those days it was the wild West and then Google put the smack down and then man the pain, the blood in the streets, in the SEO community and then that thing went hit.

Ryan Mckenzie:

It was bad. When our ringtone subscription got shut down and we started InfoBarrel, we went from making... We were 20 something making 100 grand a month. Then it got shut down and we had literally no income. I had to go start selling cell phones at the mall. I thought I was this entrepreneur that was going to be retired and I'm like, "Let's spend the money wherever we can. I'm 25." I just thought that it was-

Brett Curry:

A billionaire in a couple of years.

Ryan Mckenzie:

Yeah. We were planning getting a Lambo... It was stupid crap that I probably, I don't know. I'm glad I went through it just for perspective, but the low is really bad. It was really bad and I had some good debt but anyways I climbed out of that. Actually got out of that was doing long storing at the same time while we were trying to support all this. We met Brad in the middle of InfoBarrel and we had no money and I'd left our other warehouse but we were working in my garage and it was so cold. Kevin was shivering and then Cooper's pretty warm. He never gets that cold, but it was cold. He had an ad out for a social media guy and they had an actual office space that they're building whatever. I went down and they're like, "Oh, you're a great fit. You can rent it out." And I'm like, "Whoa! Well there's this one problem. I actually don't have any money."

Brett Curry:

Is that going to be an issue is that going to cause problems or? I can't because I pay rent.

Ryan Mckenzie:

Can I wash dishes? They were really cool about it. This is actually how I met Brad. He was one of the co-founders of Tru Earth and my business partner. And he's like, "You know what? Listen, I get it. You guys know what you're doing. First month you can stay for free and as you guys build your business back up, we'll just move your rent up to where we're supposed to be." Yeah, it was amazing.

Brett Curry:

arrangement.

Ryan Mckenzie:

Yeah. Every time I tell that story, I get tingles because if Brad hadn't offered that at that point in my life, that probably would have been it. This wouldn't have happened and I don't know what I'd be doing right now. A couple of years later we were still just working independently from each other. We were renting the space from him and we were helping them with some of their stuff with one of the magazines and he asked if we wanted to do a merger with these magazines and this other company with magazines. And I'm like, "Well, I could probably figure out a way to make money with those." That was that.

Ryan Mckenzie:

We partnered up with these other guys. We took on, bought a couple other magazines and then they decided they wanted to stick with just magazines, a couple of years in we partied ways. We started getting more into the e-commerce side of things and blending magazines with e-commerce. At the time when we had that breakup, again, it seemed pretty scary but it was probably the absolute best thing that could have happened because it allowed so many other doors and windows to open.

Brett Curry:

Yeah that's fantastic. Let's do a quick detour and talk about magazines and traditional media, and building on media in general. Where do you think that fits in the scheme of things right now for commerce in general, but for e-commerce and how has your background in magazines and in online content stuff, how has that influenced you with Tru Earth?

Ryan Mckenzie:

I've tried to get every single keyword or rank for everything, or just drive any traffic that's relevant on a really broad scale to a vertical in the path. It works okay but I think from a content creation standpoint, I think there's a lot of value because if you can make the content align with your core values, your brand story, what you're about. That content not only provides an avenue for discovery of your brand when people are looking for content on the topic but it also provides additional value to your users, allows you to stay relevant. It allows you to tear down beliefs that may be incorrect or don't align with your brand and then rebuild them with the belief systems that they need to have in order to support you, or want to support you, or to want to be in your tribe.

Ryan Mckenzie:

Then obviously any platform is always stronger when there is an audience. As far as I'm concerned, you don't want to be spread so to where you have 40 different mediums that you're delivering content on and you're not really focusing on any of them. But whether you're creating micro content for Instagram, or Pinterest, or whether you're creating these long form value filled articles to get SEO traffic. I think whatever you're doing, just really... The easiest way to do it because a lot of people are like, "What kind of content should I create about my brand?" And then I usually say, "Well, what's your story? Or what's your brand core values?" Then they're like, "Oh, I don't really have a core... I just sell these things." And I'm like, "Well, okay first thing you got to go back. Figure out what those are, and once you know what that is, it's pretty easy to A, create content if you don't have the means to create it yourself or B, once you have the means to do it, it's very easy to choose topics to create content around because you already know what your brand is about."

Brett Curry:

Yeah. That's so good. Awesome. Well, explain to somebody what is Tru Earth and how did you get into this business?

Ryan Mckenzie:

Yeah. So Tru Earth, this is what the package looks like. This is the equivalent of 32 loads of laundry. I don't have a jug here-

Brett Curry:

It looks like it is if they're just listening, it's a colorful, bright but relatively small envelope can't weight probably much.

Ryan Mckenzie:

Eight inches tall maybe by quarter inch. I don't know.

Brett Curry:

Yeah something like that, yeah.

Ryan Mckenzie:

This is 384 loads so this is like a week worth at the Curry House.

Brett Curry:

Exactly.

Ryan Mckenzie:

But that's a year for the average family of four-

Brett Curry:

Was it like two three loads a day, some days it's true, it's crazy yeah.

Ryan Mckenzie:

Yeah, and this is what the actual strip looks. If you can see it, it's like, I want to say about four inches by two and a half roughly and that replaces... In grams that weighs over three grams which is like a 10th of an ounce. A load of laundry is about 30 to 40 grams typically so an ounce to an ounce and a third. The reason why this is as effective as regular laundry detergent is because it has the same amount of something called surfactants as traditional laundry. But we've basically between two layers so it's the same efficacy, if not better than majority of laundry detergents with less than... Liquid detergent is 4% of the part carbon footprint.

Brett Curry:

One detergent is 4% of the carbon footprint. What do you mean? Explain that.

Ryan Mckenzie:

Whether people believe in climate change or not, the amount... When you transport liquid laundry detergent, if each load is 40 grams and there's 32 loads that's like 1,260 grams which is 2.2 pounds, 2.3 pounds roughly per bottle. This, oops. This package which you can't see, if you're listening is 90 grams which is like three ounces. When you put together an entire truck of liquid laundry detergent, you might only be able to get out of... By the way it's a smaller truck. You can get 100 bottles in there. With Tru Earth you'd be able to get 1000 packages, or probably more actually in that same space. Each package uses less overall fuel which in turn means less emissions to move it across the world.

Brett Curry:

Awesome. You're saving, you're eco-friendly in terms of the size of the packaging, the weight in shipping it. The waste that's there, or rather the waste that's not there when you're using the product. It's one of those things that I know in some of your ads, and we'll get into this more in a little bit, but they show just the extreme amount of waste created by those plastic jugs that your laundry detergent comes in. So you eliminate that entirely. It's either big jug of stuff or little strip and little strip is as effective or more effective. You say it's only 4% of the footprint of laundry detergent, did I understand that correctly? There's lots of like a mathematic there are lots of math.

Ryan Mckenzie:

Yeah.

Brett Curry:

It was exciting, but I was lost a little bit.

Ryan Mckenzie:

Yeah. It's even better than a pot is about 25 grams. We were still way better than that but it's basically better. I had somebody reach out to me yesterday from this climate change project and he told me that we have the most eco-friendly laundry detergent with the smallest carbon footprint on the planet.

Brett Curry:

That's amazing.

Ryan Mckenzie:

Yeah. The other big thing you mentioned the jugs, there's 700 million laundry jugs a year that end up in landfills and out of all the plastic jugs actually get recycled, only 20% of them actually get recycled because of the demand for the product that comes... The output of the recycling. So even when people think they're recycling, chances are it's just going to the garbage.

Brett Curry:

Got you. You're solving a real problem that is only effective if the product actually works too. People won't keep buying it if it doesn't work. It does work. It's a fantastic product. I want to talk about a few things here. We're going to use some marketing tactics and some marketing angles in a minute, but one thing you do well, and I think part of this comes from your background with magazines and subscription boxes and understanding how that world works. Subscriptions, so you sell a consumable, a lot of listeners sell consumables e-commerce products. What are some of the mistakes you see e-commerce companies making when trying to sell subscriptions? Then what are some of the keys to success there?

Ryan Mckenzie:

Well I can definitely answer this because I definitely made some mistakes when we started this. I'll start with the mistakes. When we first started the only way that you can get this product without a subscription was if you asked on an ad and we messaged it to you because we did a really big minimum viable product launch on this. We just wanted to see if we could... We thought we're going to sell 150 in the first month. That was our number-

Brett Curry:

150 units or 150 subscriptions?

Ryan Mckenzie:

We only had subscriptions yeah.

Brett Curry:

Yeah.

Ryan Mckenzie:

Basically we started off, you can only get a subscription. There's the two different sense. That part is you could probably get away with only offering subscriptions but where we dropped the ball was not thinking about the actual needs of each individual because a single person that's living by themselves has no need for 32 loads of laundry every single month. We didn't offer any other options, or we did, again it was only through customer service but for three months. What we're seeing is our attrition rate.

Ryan Mckenzie:

Our attrition rate was still pretty good, but our attrition rate was fairly high and we're causing a lot of dissonance in people because by the time they got to their third package, if they're a single person, every time they look in their cupboard and they see three packages of Tru Earth they're thinking, "Shit man, I need to cancel this subscription." Then they don't do it or whatever and every time they go to do laundry, it reminds them then they start getting this negative feedback loop and this negative connotations of my brand. And they're like, "Oh well, you know what? I'm not going to go subscribe to this again because it was a pain in my ass to actually deal with it."

Brett Curry:

Yeah. And they're doing this to be minimalist in a way. To reduce the footprint and to reduce waste and now even though the part is very small and it fits in the drawer or whatever, it's still it's piling up so to speak and that goes against the story and the brands too.

Ryan Mckenzie:

100%. One thing that I learned that's huge and I never really considered this before with my other subscriptions because it was like the other ones weren't consumables. We basically allowed people to choose their frequency. Like monthly, bimonthly, quarterly, or annually. There's a whole bunch of different ways that you can pick now. We also allowed them the option to do a one time purchase. The way that we framed it, we're still getting approximately 67% of people are taking the subscription offer over the-

Brett Curry:

The first time.

Ryan Mckenzie:

The first time.

Brett Curry:

67%. Interesting.

Ryan Mckenzie:

And I can tell you why.

Brett Curry:

Why do you think that is?

Ryan Mckenzie:

Great question Brett. From the beginning, we've made the price point significantly more desirable on the subscription. We don't offer additional discounts for whether you buy monthly, or bimonthly, or quarterly whatever. We want people to be happy to use the product and we also want to make an impact. But what we did do is since the customer acquisition costs... For us to be able to advertise a completely new product, we have to spend a lot of money to create awareness because people aren't going to go into a grocery store, see a product they've never seen that looks different than everything else and just buy it for fun. We made the-

Brett Curry:

It looks like a radically different laundry detergent, but it's a radically different approach using this little strip. That feels like it wouldn't work.

Ryan Mckenzie:

Yeah, and I think that was my perception when we were starting the brand too. Before I had tried the product I'm like, "Man there's no way that's going to clean our clothes." When I used it I was like, "Boy, I was wrong." But yeah. We price anchor very heavily. If you want to buy the product out of the cart one at a time, it's 1995 for a package and if you want to get it on a subscription it's 1295 and they both include free shipping. Some grocery stores have it and we have a minimum price that people can sell it for which is above the subscription price or at least advertise that. People see it like, "Oh, I'm going to use laundry detergent anyways. If I can pick the frequency then I'm going to get it. And there's no contracts, I can cancel it at any time."

Ryan Mckenzie:

It just makes sense to save 37% or whatever that number is. And it's more convenient really. I'm never going to... It's never going to be 11 o'clock at night and I have some event in the morning and I'm going to have to pick from stinky shirts because I know I'm not going to be pouring an empty bottle of laundry detergent in the wash and cursing it for being out. Yeah that was the secret sauce.

Brett Curry:

Do you think the savings that a consumer gets when they subscribe is really important? Obviously the convenience factor is huge, laundry detergent, you're going to always wash your clothes. You don't want it to think about it. It really is those two things, cost savings and convenience. There's a lot of products that can't do a 37% discount, right? For Subscribe & Save because that'd be too much of a discount for them. How important do you think your discount is? Do you have any thoughts on what the sweet spot is for a Subscribe & Save, to use Amazon's language, but the subscription discount. Let's answer that first.

Ryan Mckenzie:

I've got a couple of products that are discounted 15% and some people take it. But it definitely seems from my experience that 25% or better tends to do well and if somebody wants to switch subscription, what I would suggest doing is pick a price that you want to sell your subscription for. Maybe it's 5% less than your current one-time purchase price. Then start shifting the price of your one-time purchase up over time. Obviously, AB test make sure you're not screwing yourself or something like that. But I would be willing to bet that you will see more people take the subscription as you stretch that difference in price.

Brett Curry:

Well, it makes sense. I think and I appreciate you saying test it, and if you're going to increase that one-time price, do it gradually over time especially if you're going from one-time purchase and you've got no subscriptions, making that transition will be tricky because you're at 67%. Is that right of subscriptions?

Ryan Mckenzie:

About that yeah..

Brett Curry:

Okay. Love that. What do you do? Are you doing anything innovative or interesting? If someone does make that one-time purchase, maybe they remain a skeptic they want to make sure it works, or they're not sure how much they'll use. What do you do to get that one-time purchaser to convert to hopefully become a subscriber?

Ryan Mckenzie:

I have this really sloppy active campaign automation. I'm not even joking. We're actually moving to Klaviyo or we're in the process of moving to Klaviyo. We basically have... We've created a four or five different emails that I think they trigger roughly every... The first one comes after 30 or 60 days I can't remember. It's been a while since we set it up, but they're just basically different messages. We're always sending the same thing, just trying to hit them from different angles. "Hey, you're probably running blue on laundry detergent now, I just wanting to check in. Here's some different options for you." Maybe you want to try a year. If you like it, maybe you want to stay. Maybe you don't want a subscription, but here's all the other options that are standard. Not standard, but your typical emails for trying to re-engage a customer.

Ryan Mckenzie:

However, we do monitor which ones perform the best and then like... One thing our email copywriter's doing right now is he's taking our most popular emails and then trying to re-create them. His name is Andrew by the way. Andrew but use different lenses to talk to that same topic but from different perspectives which everybody doesn't respond to the same types of messaging. Some people respond to discounts, some people respond to the story, some people respond to a reminder because they like the product and they were skeptical. Really it's a matter of writing a few different emails that will offer the benefits from different angles and just following up with an automation.

Brett Curry:

Yep. I love it. And I love how you outlined that. Some people respond just because they need a reminder. They love the product, they love using it but they need a reminder that, "Oh yeah, I could subscribe and that would save me more and it would be more convenient." Some people will respond to the story. Reminding them of the impact they're making by purchasing this product and all the goodness around the story. Some people they respond to a discount. And so you got to lay out that discount. Really understanding those three segments, speaking directly to those three segments, automating that. Totally, totally makes sense.

Ryan Mckenzie:

Oh, sorry. I'll just say one last thing tied to that too. I won't go along here, sorry to interrupt you. But I think a lot of people think that. There is a pre perceived notion that your list doesn't want to buy more of your stuff. Not like all of your stuff. They need different products or whatever. Our buyer list is in a freaking scene, even though it's full of subscribers, we'll send a promo with the exact same product to everybody who's already got it. Not even necessarily promo, but we'll talk about whether it's how many balls are we've removed from landfills or just an update on our story.

Ryan Mckenzie:

We're not even hard selling. And we sell so much, it's like people are buying the product for their friends, people, re-uping and getting more there's... Just because people have bought... Let's say you sell protein powder. If you sell protein powder and you know some people are going to buy more protein powder because they just bought protein powder. People are crazy. They know they're going to eat it. They got friends that are going to eat it. People like to talk about the things that they think work. They want to offer them more of what you've already sold them.

Brett Curry:

Absolutely. I love that. I think, especially with consumables and at the time of this recording, the world is opening back up. To a large degree we're not post pandemic, but we're post quarantine. I still think there's always this desire for some people to have enough. Maybe stockpile is not the right word or whatever, but people like to have... They've got enough of something. I've got a little bit in reserve here. And I think that's true with most consumables. Laundry detergent as well. So even those emails, just telling the story, reminding people, "Hey, here's how many bottles we've kept off landfills." That causes them to purchase more. They want to have more on hand. They believe in the mission. And so yeah. Never underestimate the power of an email that's well-crafted even if it's not a sales message in generating new sales.

Ryan Mckenzie:

Yeah 100%

Brett Curry:

Yeah very cool. Let's talk a little bit... I want to get into a couple things. I want to get some marketing tactics in a minute, but let's talk about brand story. I think that's the best transition right now. How do you approach brand's story and how are you working your unique story into emails and ads and really all that you do?

Ryan Mckenzie:

Cool. I've blended a few different things together but my friend Kylie, we work with her to come up with-

Brett Curry:

Jenner, or?

Ryan Mckenzie:

Not Kylie Jenner.

Brett Curry:

Not Kylie Jenner. Okay yeah.

Ryan Mckenzie:

But she worked with us to come up with our... the feel and the avatar. We already knew who our building was. If you don't have a brand story, the easiest thing to do is get Donald Miller's book named Brand Story.

Brett Curry:

It's so good.

Ryan Mckenzie:

It's so good, I've been telling everybody about this. It's not rocket science. He even has worksheets you can go through like, "Who's your villain? What's the guide or do you use unique mechanism?" I can't remember all the details of his exact program, but it is dummy proof man. You just need to figure out who your villain is. We only have one villain because if you have multiple villains, we're not Batman here-

Brett Curry:

Talk about that just a little bit because this is an interesting concept and it's very powerful in a lot of ways, but why do you need a villain when you're telling your brand story and who could that villain be? I think a lot of people when they hear the word villain and they have the wrong picture in their mind here but speak to that a little bit.

Ryan Mckenzie:

Yeah. Blair Warren has a book called The One Sentence Persuasion Course and basically this is... People will do anything for those who encourage their dreams, justify their failures, allay their fears, confirm their suspicions and help them throw rocks at their enemies. People-

Brett Curry:

That is so powerful. Can you actually read that again? I'll put that in the show notes and this can be used also in the nefarious ways. We're going to talk about the good ways to use this, but if you look at successful politicians and people that are even very manipulative in what they do, they're masters what Blair Warren lays out there, so go through that one more time.

Ryan Mckenzie:

And their name might rhyme with Trump.

Brett Curry:

Awesome.

Ryan Mckenzie:

I don't want to call out anybody out though-

Brett Curry:

but it's possibly true, yes.

Ryan Mckenzie:

Here's the quote again, it's by Blair Warren and he has a book it's really good, it'll take like an hour to read, but this is how it goes. People will do anything for those who encourage their dreams, justify their failures, allay their fears, confirm their suspicions and help them throw rocks at their enemies. StoryBrand basically helps you figure out what all of those things are.

Brett Curry:

Yeah, yeah, yeah exactly. And the villain in the case of a product may not be a person, right? We don't need the villain to be a person perse. If you're selling a mattress, the villain is a poor sleep, or it's a mattress industry that's been lying to you and pulling the wool over your eyes and tricking you for a long time. So it doesn't have to be... This doesn't have to be a nasty mudslinging campaign like politicians do, but there needs to be a villain. You need to be fighting against something. It could be a concept. The villain could be climate change or just pollution and landfill whatever overwhelmed things. There needs to be a villain, right?

Ryan Mckenzie:

Yeah.

Brett Curry:

Have you guys identified and clarified who your villain is?

Ryan Mckenzie:

We had a couple of different villains when we started. We still have them both but we don't really... Obviously it's climate change. Oh sorry not climate change. The plastic, laundry jugs, and... what's it called? The carbon footprint, but we lean more on the jugs. We created the Tru Earth Movement, which is small changes lead to big impact. But our big thing with that is how many laundry jugs we've kept out of landfills and we're around a million now.

Brett Curry:

Beautiful. That's so that's so tangible though. Different people will make different associations there. Some people will say, "Man that's impacting climate change and I feel so good about that." Other people will say, "Just good for pollution. I feel so good about that." Whatever the case may be. But identifying the jugs it's visual, it feels tangible. If you were to go with something conceptual, I think it's a little harder to get people excited. I think that was a very smart choice.

Ryan Mckenzie:

Thank you. What's really cool about when you tie the villain in and you create some form of movement. We have this and we're also doing another thing where we're donating laundry ships to... We just donated 300 grand or 150 grand worth of Philadelphia food share and we've got one going to LA right now and some going to Ghana. We're sending it everywhere. Basically trying to take our operation give back. When people buy things, the biggest reason that they get post-purchase dissonance or buyer's remorse is because this thing it was expensive and they're not sure if they're going to like it or... It's usually tied to not really having any connection to the product outside of just wanting it.

Ryan Mckenzie:

When you can make your brand fight a villain, help a cause, lift people up and then you make it so it's not about the brand achieving those things but about the customer achieving that and being part of that. They're not buying the product now. They are buying into the movement and it's a lot harder to feel shitty about saving the environment and helping kids in Africa than it is to feel shitty about buying a laundry detergent that cost a little bit more than tide.

Brett Curry:

Right. It's so true. That goes back to Story Brand and Donald Miller's concept of the hero of the story is the customer. The hero of the story is the customer feeling like I'm making an impact. I'm part of a movement. I'm helping kids in Africa. I'm keeping landfills clean. They're the hero, you're the guide. You're the guy that helping them in the process helping them achieve what they want to achieve.

Ryan Mckenzie:

And that's easy to forget. That's easy to forget. I don't know how many times... I don't read that many emails anymore where I've written it. "Oh, we're so happy that our team is dah, dah, dah." I'm like, at first I was like, "Oh, sweet. I'm going to make them board the team." And then afterwards I'm like, "Shit, it's not a boat, it's a team." They're a part of a-

Brett Curry:

That's the part that it feels like it's so much about you, not about them.

Ryan Mckenzie:

Yeah. It's like we want to thank you for contributing to these 1 million bottles. Because of you, we're able to achieve this. When you ask them to share the movement with other people, they get to brag that they contributed to this as opposed to that they're associated with the brand that contributed to this. That's like a paradigm shift in people's brains.

Brett Curry:

And that's where if you can do those things that Blair Warren talks about. We're highlighting the villain aspect, but when there is a true villain and when you're also helping someone achieve their dreams and all those other things that's when they're more likely to be an ambassador. That's where they're more likely to refer. That's when they're more likely to say, "Hey, there's a discount now, or whatever, I'm just going to buy some for friends. I'm going to buy some, I'm going to give it away. I'm going to get other people in on this movement as well." That only happens if you have a brand story well executed. Does not happen if you're just about price. You guys have done very well at that. Other tips or suggestions, things you've done well, things you haven't done so well as it pertains to brand story?

Ryan Mckenzie:

Yeah. Obviously everything's a work in progress and I'm really good at starting stuff and my follow through is not as good as other people's. Which I try to involve other people that are good at follow through. But I think a lot of people get hung up on perfecting all of these pieces before they actually start implementing it. That's going to hurt you worse for actually implementing some of these elements into your overall business. What I've found and... Your brand story may actually change and some of these elements may change over time, especially if you're running Facebook ads or YouTube ads and you'll notice that different hooks wind up performing better than other hooks. It has to be dynamic. If you're Procter & Gambl or somebody like that, you obviously can't be dynamic and agile with all of your marketing messages and stuff like that. But when you're a disruptor brand or people like us, you can be agile. You can change some of these things based on performance. Yeah people might-

Brett Curry:

That's our advantage, that's what we should be leveraging and taking advantage of. So embrace that.

Ryan Mckenzie:

Yeah. You find something that works really well, maybe swap another piece of your brand story out for that if it makes sense. I find the longer I sit on things, the better chance... I'm looking at my Trello list right now. I have to-do and then I have to-do today which was basically my new list of things that I had to do because I couldn't but they're both like fricking 50,000 pages long. And I know that 90% of that stuff is never getting done because I sat on it. The same goes with the story stuff. Learn from your ads. If you need a tactical thing to test what's the best hook, go and create a Facebook ad with your target audience. Then use a dynamic creative and use whatever one image but put five different headlines and see which one Facebook resonates best with. Or split test your headline on your site and split the... I mean, there's so many ways that you can find out what the best thing is.

Brett Curry:

It's never been easier to test and you have to test because you're going to find things that will surprise you. We do a lot of YouTube ads and full disclosure, we run Tru Earth's Google and YouTube campaigns.

Ryan Mckenzie:

Highly recommend them.

Brett Curry:

I did not pay you for that, but thank you for that. But we had this tried-and-true call to action that we've been using all the time in our YouTube ads. We just started testing a new one. Learn more was the call to action that seemed to work best and that little call to action button on YouTube. Now we found, shaken it up a little bit makes the difference. It does vary a little bit client by client, but it's one of those things you don't ever stop testing. The reason we landed on learn more is because we had tested a whole bunch and learn more was the winners. So we're like "Well let's just do that." Then we forget to test again for awhile. And then we start testing and we're like "Oh my goodness, this other CT is actually working even better."

Brett Curry:

It's been super interesting. Yes, you got to keep testing. It's never been easier to test than it is now. Let's talk about what are some things you've learned... Let's look into Facebook a little bit because I know that's how you got started and I think that's a great place to start for a brand like yours because it is so different. It is so unique. People aren't just searching for something on Google just like it. They need to see it in action before they go search for it. How did you start on Facebook, early lessons, and how has your approach on Facebook changed from when you guys launched?

Ryan Mckenzie:

I've been doing Facebook ads since 2014. The arbitraging clicks to Google ads but I mean it's my... Facebook evolves really fast. I used to be able to crush sales with posts, engagement objectives or different objectives. And it's just gotten really efficient with purchase objective. But a common problem I think I see a lot with, and I actually talked to about something similar to this on a Perpetual Traffic a couple weeks ago but one thing I see a lot is people complaining that their ads burnout. Where they become less effective over time and it's super true. I've got an ad it's absolutely doing amazing and it'll do amazing, I'll just pour gasoline all over it and it does great until it doesn't. It sits in this area where your returns aren't that great.

Ryan Mckenzie:

I always struggled to constantly put creative on what and how to test it and blah, blah, blah, blah, blah. I got tired of my ads burning out and we basically set up a really simple standard operating procedure where we have every week I have somebody on my team. I've always found that Facebook ads are difficult to standard operating procedures because everything changes so quickly. But every week, every Monday a guy on my team goes and takes... We do a lot of micro-influencer stuff but they'll go on and they'll take five different micro-influencer photos and they'll create 10 different ads from those with our two best copies. One is really story focused and one is really benefit focused. I find that different people respond to each others differently.

Ryan Mckenzie:

I've got winning ones we can split test that copy somewhere else with winning creative but basically every Monday five of those and then we take one video creative that we've made and we test that again with those two things. If any of those wind up being winners and hit certain numbers, we extract them and we put them in our big boy campaigns whether it's the retargeting or top of funnel or whatever it looks like it'll work best. Before I would be testing creative once a month and I would probably find out... I usually find something good once a month, every two months. But it was really... You get in this head space that you've just chewed up all the audience or you've... Facebook ads are getting worse, they're getting more expensive. Yes, they're getting more expensive blah, blah, blah-

Brett Curry:

There are getting to a certain degree of that.

Ryan Mckenzie:

Yeah. But you can counter that. Whatever your best TPA is, if you hit an ad that really resonates with people or whatever there's definitely the 80 20 of ads. The rest of these ones might do... 80% of them may do well, 20% may do terrible. 50% of them may perform enough to keep them active. Then there's going to be a 20% that do well and there's going to be a 4% that are absolutely mind blowing. That you are going to get a line of credit and drain your bank account to make sure that this ad gets seen by as many people as possible. There's not a winning ticket out there to magically win at Facebook ads or Google ads or something like that. But if you're not testing, you're going to burnout your ads and you're not going to find anything that's attractive. If you don't know what to create for ads, the actual creative, the two things obviously, pictures of people holding your product are great as it has got a love demo love which is like testimonial, demonstration, another testimonial.

Brett Curry:

It was originally a test of that's usually how we but love demo love is great too. That's more Ezra and then his lingo, which I like. But yeah, that's a fantastic that works on YouTube, but YouTube ads works with Facebook ads such a great template. I think it underscores some of these you're saying. We get upset that ad costs are going up. We get upset that creatives wear out quickly, or we can just embrace it and say, "This is just the way it is." How do we build this into our standard operating procedures? How do we get really good at testing and deploying lots of creatives and weeding out the losers and pouring more gas on the winners. Because your competitors probably won't do that. They're going to be just as frustrated as you feel like you are. So rise above that and do what it takes and you guys do that very well.

Ryan Mckenzie:

Yeah, thanks.

Brett Curry:

Any surprises, any takeaways as you've gotten your SEO background and Google and you're really into Facebook ads, but as you guys have done more and more with Google and YouTube, any interesting takeaways or insights or things you've observed on the Google and YouTube channels?

Ryan Mckenzie:

Like Google search or YouTube ads?

Brett Curry:

Yes, both. Take your pick on which one you want to talk about first.

Ryan Mckenzie:

Before I worked with you guys, and this isn't a plug for Brad though I would definitely recommend Brad and his team. Google shopping I had never... I didn't even know how to set it up because it's complex. It's an effective tool. There's a whole lot of wins tucked in there for e-commerce which reminds me, I should probably get you guys in touch with some other ones, but I was really surprised by that. YouTube I find has been fickle. You and I tried it before with another brand and my creative probably sucks because the creative on YouTube is different than the creative on Facebook.

Brett Curry:

It's quite different. There's some interesting correlations where if you have video that works on Facebook, then you can probably get YouTube ads to work too. But it's usually not the exact same creative. It usually needs to be tweaked some. There's been a few cases where we can take creative directly from Facebook and run on YouTube but that's very much the exception not the rule.

Ryan Mckenzie:

The one ad that done well for us with you guys didn't do exceptionally well on Facebook. I guess really it's the same with virtually any platform and why it's tough to be a media buyer on omni-channel media buyer and be really good at it is because every channel the way that people consume it's a little bit different and the customer that's living there is a little bit different.

Brett Curry:

The algorithms are a little bit different. So how you can influence that and optimize that it's going to be different.

Ryan Mckenzie:

The cool thing I really like about YouTube from watching what you guys have done is how you can take that search intent, not even necessary what they searched, but there's just so many different angles that you could access when they're part of that whole Google suite that you can't get through Facebook. When Tru Earth started seeing success with what you guys are doing on YouTube, first I was like, "Alright, is this going to last a week and it's going to die?" This was in January and it's funny because at Blue Ribbon. Brett and I were both at Blue Ribbon, we were in a temporary that's what it was, right?

Brett Curry:

Mm-hmm (affirmative).

Ryan Mckenzie:

Wherever it was, I had a lot of people saying... There's not a lot of people that I found that have been able to be successful with YouTube and I don't know what the reason is, but everybody told me that your creative burns out in a week.

Brett Curry:

That's true.

Ryan Mckenzie:

We're at six we're at six months I think almost now and the main creative still the same.

Brett Curry:

Right. Yeah. That is one key difference between YouTube and Facebook. On YouTube if you find a winning ad, it may run for longer than a year. The reason for that, and you talked about audiences. If we're looking at intent-based audiences, so audiences based on what people are searching for and things like that, those audiences refresh all the time. I'm searching for this today, so now I'm on your list but then I'm not searching for later I'm off the list. You're always getting new people on those lists that you're targeting and that's one of the reasons why those ads can keep working on YouTube. Sometimes we'll be testing and tweaking some things but yeah they definitely have a longer shelf life for sure.

Ryan Mckenzie:

That was... I really like... I think a lot of people are very dependent on Facebook. I think if you want to be on omni-channel brand, if you can figure out YouTube or have somebody like Brad and his team figured out YouTube for you, it just gives you a little bit of breathing room to not have to completely base your entire business existence on one platform.

Brett Curry:

Right. Which is really never a good idea. Obviously I love YouTube because that's what has been the focus of my professional life for the last four or five years or so but it is a good idea to diversify. Depending on your business model, your product and a variety of things your audience, there's a ton of scale on YouTube. We have some clients that spend more on YouTube than they spend on Facebook, and a lot like to spend that spend more on Facebook than YouTube depends on a variety of factors but yeah diversifying is definitely a good idea for sure. As we wrap up this has been fantastic. Thank you for being so open and honest in sharing. What's next for Tru Earth and obviously you may have some super top secret stuff you can't share but where are you guys going from here?

Ryan Mckenzie:

We're looking to get a new office possibly with a bit of retail. We have a warehouse with retail. It's going to probably be a few months away provided COVID rise but we're trying to ramp up retail pretty hard. We're starting to push a little bit more in Europe and stuff like that. But really trying to get the product all over the world so we can eliminate plastic jugs from landfills as a team.

Brett Curry:

Love it. Yup. Fantastic. Love the message of the product of the brand. How can people who want to learn more about Tru Earth or more about you? Where can they find you?

Ryan Mckenzie:

You can find more about Tru Earth if you go to www.tru.earth there is no dot com.

Brett Curry:

That will lead to

Ryan Mckenzie:

And you could find me... I'm on Twitter. I don't really post that much but Rye McKenzie, R-Y-E M-C-K-E-N-Z-I-E or on Facebook. My Facebook business pages is facebook.com/theryemckenzie, same as Twitter but with a the in front of it because somebody else took my name.

Brett Curry:

He's an imposter. They're trying to be like Ryan Mckenzie. I'll link that in the show notes as well so you check that out at OMG Commerce and click on the podcast and you'll find it there as well. Ryan Mckenzie ladies and gentlemen, Ryan man thanks for taking the time. It's been a ton of fun. Really appreciate you coming on.

Ryan Mckenzie:

Oh my pleasure, man. It was very generous to have me on the show. Appreciate it.

Brett Curry:

Awesome. Thanks fantastic and as always thank you for tuning in. We'd love to hear feedback from you. What would you like to hear more of on the podcast? What would you like to hear less of on the podcast? We'd love that review on iTunes. It helps other people discover the podcast as well. With that until next time, thank you for listening.

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Episode 124

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Chris Meade - CrossNet Games

Turning a Crazy Idea into a Multi-Million Dollar eCommerce Business

Chris and his brother Greg and co-founder Mike turned their crazy idea into a wildly popular product and a rapidly growing company.

CrossNet Game began as a crazy idea dreamed up late at night by two brothers and their best friend. But ideas are a dime a dozen. Chris and his brother Greg and co-founder Mike turned their crazy idea into a wildly popular product and a rapidly growing company. So what is CrossNet? It’s 4-way volleyball. Put another way, if volleyball 4 square had a baby, it would be CrossNet. And it’s amazing.

This is a phenomenal story about how to launch a product from total obscurity into a sensation. We talk about how the product came to be, how the founders successfully boot-strapped everything initially, and how a combination of playing volleyball all day on the beaches of Miami plus Facebook Ads fueled their launch. Here’s a look at what we discuss:

How their first “prototype” and first test market let them know they were onto something big
Why they packed their bags and moved from Connecticut to Miami to launch CrossNet
Creating the snowball effect - doing lots of little things well and watching success and momentum grow over time.
Their first brand ambassadors and their first influencer…all by accident (but still duplicatable)
Their most important sales channels
How they view Amazon
How they are using events (pre-pandemic) to grow the brand
Getting their product in 5,000+ schools
Getting into Dicks Sporting Goods, Academy Sports and more
What products are next for CrossNet and how they plan to grow (including running YT ads with OMG Commerce…)

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Mentioned in this episode:

Amazon DSP

DICK’S Sporting Goods

Today Show

Academy Sports

Seal Sports

Chris Meade - Co-Founder at CROSSNET

CROSSNET - Four Square Volleyball Net

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Episode Transcript

Brett Curry:

Welcome to another edition of the e-commerce Evolution podcast. I'm your host, Brett Curry CEO of OMG Commerce. And today we are talking about how I did it and not how I specifically did it but how my guest built his business. It's a fantastic story. It's an amazing product. You're going to be inspired by this story and you're going to learn a lot. I'm going to have a lot of fun in the process. This episode of the e-commerce Evolution podcast is brought to you by OMG Commerce. And in addition to this podcast we want to be a resource for you helping you accelerate your e-commerce growth.

Brett Curry:

So I have with me on the show Chris Meade, co-founder of CROSSNET game. You may be asking what is CROSSNET game. You may have seen it. You may see it on Facebook. We're going to tell you all about it on the show and lots and lots of e-commerce lessons along the way also. So Chris, welcome to the show and man thanks for taking the time.

Chris Meade:

I appreciate it man. Thanks for having me on I'm excited to talk.

Brett Curry:

So just real quickly for those that are watching the video because they can see you're in a, it looks like a cool high rise building.

Chris Meade:

Yes.

Brett Curry:

Where are you hailing from and what's the weather like there right now?

Chris Meade:

Yeah so I'm hailing from Miami. I'm a small farm town boy from Connecticut though. We moved to Miami three years ago to start our invention. And the weather is, we're finally out of a tropical storm we've had four days straight of rain so finally nice to see the sun in Miami.

Brett Curry:

That's amazing. So pretty big change then from Connecticut farm to Miami. Just curious, before we get into the story of the product and the business and all this fun stuff why Miami?

Chris Meade:

Yeah. So the product it's a four way volleyball net. So we were in Connecticut, it's rainy, it's cold, it's dark the majority of the year so it was just a logical move when we started a volleyball net company on the beach.

Brett Curry:

On the beach man.

Chris Meade:

Yeah on the beach Miami or California and our family's on the east coast so it just made sense to stay a little bit local, a three hour flight back up to Connecticut so Miami it was.

Brett Curry:

Going to Miami. So before we talk about all the cool story of how the idea came to be and then more importantly how the company came to be because we were talking about this off air lots of people have good ideas man, lots of people have these crazy ideas of what if we combine this and that. But turning that into a company is really hard and a lot of people don't do that. But before we get into that, what was your background so what'd you do before this company?

Chris Meade:

Yeah. So I actually went to school for film. Film and photography was always a passion of mine.

Brett Curry:

Did you want to make movies?

Chris Meade:

Yeah I wanted to make horror movies actually. I love scary movies. There's only a few really famous scary movie directors so I was like, "All right, there's an opportunity there." So, I went to film school, graduated with a lot of student loan debt, got to work on a few HBO... I was working on the show HBO Girls I was an on-set director, a production assistant. Awesome. So, that went cool for a year, it was all right. But I was working 12, 14 hour days, not making close to the amount of money that I needed in my bank account to survive in Manhattan.

Brett Curry:

So, I'm curious did that fuel the passion for film or did that make you say like, "Maybe this isn't as great as I thought."

Chris Meade:

That's a good question. So, it fueled the passion when I was doing the stuff I liked. One of the guys on the set is now Darth Vader and I've had conversations with him. I remember talking to this dude for 10 minutes and I'm like, "That's Darth Vader." So that's cool now but hindsight waking up at 4:00 in the morning and taking a subway to Chinatown and being there in the pitch black and literally working for 14 hours for $10 was not ideal to me so.

Brett Curry:

A lot of people have these visions of grandeur like all of show business is amazing and there's just a lot of work and there's a lot of people in the show business that aren't making any money.

Chris Meade:

Exactly yes. I mean kudos to anybody who can stick it out and grind it out and get to where they want it to be. I'm sure it would be much better if I was a director or producer but it just financially wasn't in the cards for me with the college debt I took on. So, got into a sales job, started selling commercials. That was super corporate America.

Brett Curry:

Like TV commercials, radio commercials?

Chris Meade:

Yeah TV and radio.

Brett Curry:

Nice that's how I got my start as well in radio ad sales.

Chris Meade:

Exactly. Yeah. So that was corporate America 101 like, "Chris your shirts a little bit untucked please tuck it in. You need to be here at 9:00 or you're fired."

Brett Curry:

I was rocking a tie back in the day.

Chris Meade:

Yeah. Exactly. So, I left that and joined a software company, SAS in New York City called Contently, created sales experience meeting CMOs of all different types of companies, learned how to work a room. Which is helpful now when I'm in pitches with retail buyers all across the country. I went to Uber for a little bit so I worked as an account executive at Uber headquarters in Chelsea. Quit that when CROSSNET came to be and flew to Miami and that's all she wrote.

Brett Curry:

Awesome. Awesome. I love that story. I love that you have so much sales experience. I think almost anybody that's going to be an entrepreneur it's great to have at least some sales experience. You don't have to necessarily be a salesperson but everything has to be sold in some capacity whether that's all through text on a screen or through video or whatever. But I think there's something about that either face to face selling or selling on the phone or whatever that really trains you to understand the process. It's difficult to get someone to part with their money and to trust your product or your service or whatever so that's awesome that you had that experience. I still value my time of hitting the streets as a radio sales person it helped shape me and make me who I am so.

Brett Curry:

Yup that's awesome. So CROSSNET you mentioned it as a four way volleyball net, it's such a cool concept. So, how did this idea come to be? Was this over a couple of beers or how did this come to be?

Chris Meade:

So I was working at Uber. I had came home for spring break or whatever it was. My brother was home in Connecticut where we're from and our partner Mike so the third founder had just graduated from Northeastern with an engineering degree. Greg was running a few eCommerce businesses. I was just grinding along, making money, making good money but just wasn't fully content at the job. And he's like, "Dude, I'm coming over. Let's chat, let's invent something because I don't want to do this 9:00 to 5:00 thing yet."

Chris Meade:

And we had ESPN on in the background, start writing down ideas, none that really are super memorable. And eventually we write down four way volleyball net. It's about 3:00 in the morning, getting pretty tired. And we Google four way volleyball net and nobody had ever done it before, no photos, no product, no Walmart listing. And we're like, "This is too good to be true," and woke up the next morning super pumped. We went to Walmart, got two badminton nets, ring them together, cut out the center. We texted our friends we're like, "Meet us at the house at 12:00 and we just played for five hours straight it was so much fun."

Brett Curry:

Quick test market, let's go make one of these. And I love this because when you see the product and obviously we'll link to it in the show notes and you can see videos and all that it's a cross between volleyball and four square. And so, as a kid on the playgrounds at school I loved playing four square. My kids love four square. There's just something about it, you get the rotation going, getting people in, it's competitive, it's fun, it's fast paced. So obviously when you had the idea and you saw that there wasn't anybody else doing it you were like, "Okay, this is an idea." But then did it really hit home when you guys were playing it?

Chris Meade:

Yeah we were playing and it was just like the sun was going down and nobody wanted to go in. And the coolest part was nobody was checking their cell phones, nobody was texting, everyone took photos of course but we finally got to disconnect. And as you get older the time with your friends where you're not on your phone is the best part. I'm 27 so I still have the phone glued to my hand all the time. But I know when I put my phone down for half an hour those are always the best memories not when I'm on Twitter.

Brett Curry:

Absolutely. That's a conversation I have with my teens, I have teen kids now, "Hey, you're never going to look back and say, 'Man, I remember that day I was on my cell phone." Those aren't your memories. That's fine, I obviously love mobile technology But yeah, you create those memories when you put the phone down so that's awesome. Okay. So got the idea, you rigged together the prototype of CROSSNET, you and your buddies are playing, everybody's addicted to it. So then transition to the business because again that's the part that's hard. So many people have an idea but making it a business is super tricky how'd you guys do it?

Chris Meade:

Especially a product, right? It's one thing to create an agency or something but creating a physical product and having it tangible in your hands it's tough and that's why a lot of people fall off. Fortunately for us, Mike he was an engineer. We didn't have to go scrap up a bunch of money and then go sell ourselves to an engineer to create the blueprint. We had this dude who had AutoCAD on his computer and this was his, that's his passion was designing stuff. So boom, boom, boom, took some photos, got some draft models going and then we started reaching out to manufacturers. So, we found a sporting goods manufacturer overseas who specifically dealt with volleyball nets in particular.

Brett Curry:

Wow that's perfect.

Chris Meade:

Yeah and the conversation was really good, trustworthy, sent over some paperwork, sent over the product and they're like, "Can you do it?" And we're like, "Yeah, we can do it. It might take a few months for you to get it but we'll do it." And we told them our financial situation, we were just three kids. But Greg and Mike were 24 at the time and I was 20 or they were 22 and I was 24. So we didn't have much money and we're like, "Hey, we've got $10,000 take it or leave it," and they took it and we're like, "We promise one day we'll be putting in bigger orders just get this first order out for us." So, got the first one landed and it was cool. It worked, it stood up, there's some things that we changed and modified but it was pretty much the CROSSNET that you see today.

Brett Curry:

That's awesome. So you had the engineering connection and that's huge. I mean it is a simple concept but still going from simple concept to a net that holds up and works that's not easy but you had an engineer as a co-founder so that's super handy. You found a connection overseas to manufacture it. So now you get this $10,000 order of products what do you do? You're hocking it out of the garage, you're traveling around selling it, what are you doing?

Chris Meade:

So, the first thing we did really we moved to Miami and we started going to the beach every day just setting it up and we would just have, we'd set it up. People would be staring at us like, "What are these kids doing?" You're setting up a volleyball net and then you think out the second side and it's like, "Oh, what is this." So by the end of the day we'd have 20, 30 people playing it and we wouldn't even get to play our own game. And we would just be taking content all day long on our phones, run home at night, post it on the website and then run ads on it. Granted we had a super frugal budget back then but a lot

Brett Curry:

So, you're using just playing at the beach to get your content and you're mainly selling through ads. I'm assuming that you have people on the beaches thing, "Dude, where can I buy one of these?"

Chris Meade:

Of course. Yeah. So yeah, so almost all the time we would sell the one. We would never bring home the same CROSSNET. So, we'd ship that out. I have a fond memory of these girls from New York, this town called West Islip, never been there myself, but they were from advocates of the game they had such a blast. They bought it and every weekend for a year straight they would post them playing CROSSNET. And so, as they would play it at their beach people from their town would be purchasing and I'd be like, "Oh, another order from this town they must be out there marketing it for us." So, it got

Brett Curry:

Your initial ambassadors.

Chris Meade:

Exactly. So the more nets out in the world the more eyeballs and eventually it was like, "All right, I don't need to go to the beach every day I have customers who are doing it for me for free. We're going to have that same organic approach." So, that's when the business really started to take off.

Brett Curry:

But and then you're 100% right. But you also, I think there's a lot of people that start an eCommerce business the one to just hide behind the computer screen and just let the customers do it from the beginning.

Chris Meade:

Of course.

Brett Curry:

This wouldn't have happened if you guys hadn't gotten out there and gotten sandy and hanging out on South Beach there could be worse things. That's cool that you got to do something really fun. But yeah, you guys got out there and you were hustling and you were demonstrating the product and you were selling it and then eventually the customers took that over.

Chris Meade:

Exactly.

Brett Curry:

But you guys do have... I actually just had a call with a guy earlier who's thinking about how do you measure, how do you track word of mouth? It's a long conversation that...

Chris Meade:

It's a tough one.

Brett Curry:

It's tough but it happens. And so, but if you can think about part of that comes from product design. So does the product hold up and can the product be used in public settings and if it is then people are going to see it. And anyway all of that just is really working for you guys which is awesome. So let's talk about what were some of the early mistakes because I think we all learn from and even as an agency owner I can think back of all the things we try to do in the beginning where we try to do too many things or we try to do things that we really sucked at and that was crash and burn. But then we focused on some things that were really, really good at and then things took off. What were some of the early mistakes you made?

Chris Meade:

Yeah I mean hindsight's always 2020 but I think the biggest mistake for us was we launched our product when our manufacturers said they were about to ship it but not when it actually landed. So we had expectations, we thought that the product would arrive to the states much sooner than it actually did. So, we had customers order thinking they're going to get their game in about 15, 20 days but in reality they weren't going to get their game for 90 days. Yeah. So that was a tough start to the business.

Brett Curry:

Some people are less understanding than others when it comes to yeah...

Chris Meade:

Of course. So I mean yeah had we have done a kick starter or something who knows it would have helped with just messaging.

Brett Curry:

Kickstarter people are more patient with that for sure

Chris Meade:

So, yeah did we deceive people? I don't know I don't think we intentionally meant to.

Brett Curry:

Not on purpose no.

Chris Meade:

Yeah. Exactly. So that was our first run at customer service even at a small scale of 50 to 100 customers but definitely lesson learned if I ever start a business again don't start it until the product is in my garage.

Brett Curry:

The product in hand.

Chris Meade:

Yeah, exactly so that was a tough lesson. And then also just being super frugal with inventory and also packaging, don't overbuy boxes or stuff like shipping material just because you're getting a price break even for 50 cents or a quarter. You could always buy back more stuff, products change. I remember when we designed our box and we bought 2000 of them but we only really needing 500 and we ended up changing the box so we lost out on 1500 boxes that we had to just chuck. So stuff like that all adds up.

Brett Curry:

Especially in the early days that totally makes sense. You're almost guaranteed to make some of those changes. So, what looks like a quantity break it's going to cost you in the long run.

Chris Meade:

Exactly. Yeah.

Brett Curry:

That totally makes sense yeah.

Chris Meade:

Those are two of the biggest things yeah. I mean, definitely had we gone back I would've been more frugal about it, I would have been, "Hey, we need 500 boxes for 500 games and that's it and we'll get our price breaks later on."

Brett Curry:

Yep. That's awesome. Every company has them, you can't fully avoid them but I think it's good just to share the mistakes and so other people can learn from them. What about on the marketing side are there any mistakes you guys made on the marketing side? And I know that that can lead to some pretty technical answers and stuff like that but any thoughts there?

Chris Meade:

Yeah. So the biggest ones I think of is not taking email marketing seriously, seriously enough. We would have one or two flows like, "Oh, put your email in for a coupon." You'd get one email and that's it, that's where it dropped off. So just literally within the last five months we've hired an email agency. You've got a full time creative director to oversee everything. That's where we started to make 15% of our revenue through email, before it was 1%. So, just adding two or three email touches that are just automated is an additional $100,000 revenue it's crazy so.

Brett Curry:

And it's such a big deal because we focus a lot on driving traffic, cold traffic through YouTube and Google and Amazon but then also remarketing traffic. But if you have the email flows in place then we can be more aggressive, you can be more aggressive on Facebook. You can do those things to drive more top funnel traffic because you know you're going to be closing a much higher percentage of people that you get to visit the site so totally, totally makes sense. What were some of the early wins maybe as Bob Ross would say the happy little accidents that happened or the things you did on purpose that really worked well?

Chris Meade:

The biggest one so our product is 20 pounds so it's not the easiest to ship, it's not the cheapest.

Brett Curry:

It's bulky like you could imagine a volleyball the post, the poles are larger.

Chris Meade:

Exactly and I know a lot of people start up a Shopify store they're like, "We'll send it out to a bunch of influencers." In our situation we didn't have the luxury to do that because every time we send out a product we're out $50 or so with the cost of goods plus shipping, you quickly find yourself in a hole. But fortunately for whatever reason we have people reach out all the time. A guy from Latvia reached out to us and we're not volleyball players, we were never volleyball players, we're very honest about that. We made a game that's fun and it has volleyball.

Chris Meade:

And so, this guy wrote back he's like, "Let me get a sample sent out." Whatever reason we sent him one and about a month later we wake up to this video that has 5 million views on it. It's team Latvia like the Olympic team Latvia playing CROSSNET this deserted island. And it is the coolest rally ever, you've probably seen it online. This is what we run ads all the time on it's this original video of teen Latvia playing CROSSNET and it's dope crazy spike and it just shows the game at its full potential.

Brett Curry:

So you're saying that was worth the $50?

Chris Meade:

Exactly. Yeah. So, that started our company in my eyes. We were selling one or two a day I'd be like, "Dope we hit three sales today." And we woke up and my phone was like 5 million views on this video. Sales were coming it was like that was the start of CROSSNET in my opinion.

Brett Curry:

Yep. Awesome. So that's when it hit and then and now you're still using that footage. And what's interesting, you couldn't have manufactured that. I mean, I guess you could like sometimes you can but that's the way business and entrepreneurship goes. You're going to be doing some things, some things happen because you're hustling like you're going to the beach, you're working hard, you're showing this thing off, you're not just sitting at home all day, good things happen because of that. But as you get momentum you're going to get these happy little accidents that happen and you can't always predict it but they happen if your product is good and things can take off.

Chris Meade:

Exactly.

Brett Curry:

That's awesome. Let's talk about your most important sales channels now where are you selling the most and talk about some of your marketing mix. And I know we can't divulge lots of secrets and stuff like that but share with us what you're comfortable with.

Chris Meade:

Yeah of course. I think the majority of, I'd say close to 80% of our sales are directly on our eCommerce site across crossnetgame.com. That's where we drive all of our traffic, that's the most profitable for us. And then the way we're getting that traffic is typically through Facebook. We have a pretty high Facebook spend. We are seasonal gain in some aspects but COVID has helped with that. People are looking for something to do, they're desperate to get outside and our game's been perfect for that so.

Brett Curry:

And specifically, I was talking to Greg your brother the co founder, you've got a lot of moms buying the game. which totally makes sense because kids are stuck inside let's get something to get everybody outside and we play as a family, we're quarantined together. And now most people are coming out of quarantine are whatever but still you're not doing what you've always done you're hanging out at home a lot more so it's still a great time to buy.

Chris Meade:

Yeah. So Facebook's our number one channel for sales overall and traffic but also that's our mom and dad demo. Moms and dads are on Facebook. My mom's on Facebook, she has probably six Facebook accounts and she just keeps making them. She has no idea how to log back in but anyways those are the type of people we're selling to.

Brett Curry:

That's amazing. I love it.

Chris Meade:

Yeah so they're watching the videos, they're clicking, boom, CROSSNET looks great for my backyard and those are the real people and we're selling with UGC content. I don't think we've ever paid more than $1,000 for a video in our lifetime and we're a big company at this point and we never will unless we really need to. User generated content, what does this look like when I go set it up in my backyard and there's a barbecue going on and my eight year old daughter's out there playing with our 14 year old son? That's what they want to see. That drives tons of traffic for us and then remarketing that through Facebook and also email is huge for us. Going to start with YouTube with you guys which I'm pumped about.

Brett Curry:

And so on the YouTube side using that user generated content is so powerful on YouTube as well, we'll need to and this was a topic for another podcast I just actually did a deep dive on YouTube, but we'll need to string more together and since we have a voiceover and I've been working on that with Greg but you still use that UGC is so powerful and so pumped about that for sure.

Chris Meade:

Yeah the UGC is great every day. I literally just got a video half an hour ago of a family in North Carolina playing on the beach and there's 40 people around the net. It just remind me of the Miami days, it's crazy. So yeah, and word of mouth, word of mouth is huge just organically spreading it like, "Oh, that's that game I was talking about." And so, it all piles up.

Brett Curry:

Yep. Love it, man. Love it. Love it. So, let's talk about your Amazon strategy and I have a lot of people on the show, a lot of merchants, a lot of service providers, everybody has a slightly different take on Amazon. Obviously we can't ignore it but is Amazon an enemy, a frenemy, whatever evil, not evil but talk about what your current Amazon strategy is.

Chris Meade:

I means for us we're in a different situation than most people I'd assume. We have a distributor who purchases in bulk 40 foot containers. So they're importing thousands of CROSSNET's a year sending them to their DCs all across the country and then fulfilling within 72 hours, which is great, on Amazon. We're still pumping the majority of our traffic to our website because at the end of the day my goal is to always to own the audience. We have new products coming out this month, next year. And if they're on Amazon and I don't have their data I have to pray that my brand is strong enough that they're going to come back to us organically or follow us on a social media platform which I can't rely on. As good as I make my company I can never rely fully to have their attention. So, by having an email and phone number that's the best thing I can do.

Chris Meade:

But yeah, I'm never going to shy away from Amazon, Amazon makes tons of sense. And what I'm most excited about with Amazon is that we're opening up Amazon in Canada, opening up Amazon in the United Kingdom and Amazon Australia. So, that's all happening within the next three months for our company. People want to buy it, people spend $150 to ship a $150 game. So, I can only imagine when we pull that lever and can actually start marketing to these foreign countries that's when Amazon is going to be big for us.

Brett Curry:

Yeah, it's amazing. But it just shows that people want experiences and they want, it's just totally worth it. I can't play a four way volleyball game in any other way so of course I'll pay the shipping. So, you're primarily driving traffic to your .com so you can own the customer relationship and all that but there's still always going to be some people that just say, "I buy from Amazon. I want to buy on Amazon." Or whatever so they're going to go there so you have a presence there which totally makes sense.

Brett Curry:

One thing you ought to consider and something we can talk about later but utilizing Amazon DSP it's a form of Amazon retargeting where you could take even your Amazon buyers, target them with display ads on Amazon and off Amazon but you can send them to whatever site you want to. That's something you could use to, "Hey, now we're releasing." And I won't steal your thunder but if you want to talk about some of the new products that' would be awesome. So as you're releasing these new products target those buyers on Amazon and say, "Hey, check it out we've got these new products." So, do you want to talk a little bit about what's next?

Chris Meade:

Yeah, of course. So we've been on the market for three years now with our outdoor volleyball game but what it has led to is that we have partnerships with over 5,000 schools right now. So kids all across the country are going to gym class and learning how to play volleyball on a CROSSNET rather than a traditional volleyball net. So one, that's an awesome feeling it's just absolutely crazy.

Brett Curry:

Which I think that's so much easier because we, so just a quick example and I've got a big family but we would set up a volleyball net and you have to have a lot of people for volleyball to make sense but if it's two on two or even three on three volleyball is hard especially if you get one or two people that are not great volleyball players it's almost impossible.

Chris Meade:

And on the contrary like in gym class I remember going and it's 10 on 10 and you're six on six and then you don't touch the ball for an hour. So, growing up we all went to this volleyball, gym class we're like "Volleyball again? This sucks." So, now having the CROSSNET they can actually touch it, you get spiked on, learn hand eye coordination. But what it's led to is gym teachers are demanding that we have an indoor setup. So we just released indoor bases that you can slap on, add on, they're $100, really easy to fill up with sand or water. And the cool part about it is they're now played inside but also great for tailgates. So blacktop, anywhere, turf, anything that wouldn't allow you to stake in CROSSNET normally you can use these spaces for so that's been great for us. We released that a few months ago, great success so far.

Brett Curry:

Awesome. Awesome. And that helps with non beach locations and of course you can do the, you can drive stakes in a park or something but sometimes it's not easy so having a bases it totally fits. Cool. Any other product releases on the horizon or

Chris Meade:

No, this summer we got the pool model coming out so this is the formal announcement. Limited stock, not sure how many we'll actually get it. I know we have at least a thousand on the way but I can't imagine.

Brett Curry:

It won't last very long.

Chris Meade:

No, it will last a week if that's... Limited edition.

Brett Curry:

Yeah. Very cool, man. Very, very cool. So, let's talk a little bit about so there's so many cool things going on with the company but let's talk about this was a win whether anything fully happens here or not. So, at the time of this recording I think you said you just recorded a TV show recently. So do you want to talk a little bit about that how that came to be and what that looks like? And by the time this show airs it'll either be, the episode will be out there for everyone to watch or maybe it won't, I don't know, but either way it's really cool for it to happen.

Chris Meade:

Fingers crossed yeah. So anybody who has a Shopify store you need to keep a chat box on your website. I can tell you Dick's Sporting Goods they came through on my chat box, "Hey, we are ready to place a purchase order. This is Dick's, this is not a joke." That's how we started with Dick's. So, the Today Show reached out to us, like the actual Today Show, "Hey."

Brett Curry:

On your online chat, on your Shopify store, the Today's Show reaches out, crazy

Chris Meade:

And we write back, "Is this a joke?" And this is legit.

Brett Curry:

Is this you? Are you messing with us? Yeah.

Chris Meade:

And then we had our events person pick up the phone and have been communicating back and forth, got them a CROSSNET sent out to LA and they filmed the segment this morning and it's ready to go live within the next 48 hours, it's supposed to go live on Thursday or Friday and it's just insane, so excited.

Brett Curry:

It's amazing. It's amazing. And so yeah, it just shows and one of the other I think great entrepreneurial lessons but just good business growth lessons is you have to have a lot of things going and when you do things build on themselves. So you've got ambassadors and you've got Facebook and now you're looking at YouTube and you've got all these touch points. You're investing in email marketing which is great and you're doing all of these things. You've got word of mouth and then the Today's Show.

Chris Meade:

Yeah exactly it's crazy.

Brett Curry:

And it takes effort on the part of the founders and the marketing team and all that. Some of it is a little bit of luck involved as well, that always happens, it's true for every entrepreneur but it's super cool. One last topic here that I want to touch on and then we'll wrap up. You mentioned you brought on I think you call him the creative director or a marketing director. Can you talk about the team growth and how you guys were approaching that? Because I think it was scrappy, it was you and your brother Greg and your partner Mike. And so yeah what has team growth been like?

Chris Meade:

Yeah, so we have three founders, fortunately for us, when we started the company. I head up sales and marketing, Greg's the CEO he handles all the legal and other nonsense we don't want to deal with. Mike does engineering and logistics. And then so, our first two hires was we found out that it was more affordable for us to rent out a warehouse and hire a full time worker, who is my best friend growing up, to ship all the products out instead of going to a fulfillment company and getting charged way too much. And our second hire was events, event marketing, just setting up tournament's and music festival partnerships. And now we have a creative director who oversees all the campaigns we create overseas, email marketing oversees any of the social media production.

Brett Curry:

Actually, I want to pause just a minute and talk about that and the event piece because this is interesting. I think, obviously it's an obvious fit for you, you're a game, very visual, people see it being played, they want to buy it, but I think there's the other eCommerce businesses that could benefit from events and showing up in person at events. How do you guys approach that? And obviously I know this is a weird time, not a lot of events happening, events are either on hold or they're changing drastically but one day there will be more events and stuff. How do you guys approach that? How do you find events? What do you do at events? Just talk real briefly.

Chris Meade:

Yeah. I mean fortunately for us there's tons of events to be at whether it's at a music festival? So we had, I was so excited, I'm a big music guy. Life after CROSSNET involves music production, music festivals. So we had just cold email out to music festivals, "Hey, do you want CROSSNET set up at your sand location?" Pharrell's music festival they wanted a CROSSNET set up. We had a contract and everything was in the CROSSNET tournament at Pharrell's music festival, that was a logical thing. Gym teacher conferences, camp counselor conferences, retail store conventions, those are all things that we need to be out actively, we're excited for we'll see if we get back to it this year, if not next year.

Brett Curry:

But it was strategic in a lot of ways because and the gym teacher conference that's brilliant because yeah it's going to lead to sales in those schools which is nice like 5,000 schools that's not an insignificant number of sales at all that's great. But think about the thousands and thousands of kids that come through each of those gym classes and see CROSSNET and now want to tell mom and dad to buy one. It's just, it's really brilliant marketing helps fuel distribution and awareness and it's a marketing multiplier so really, really smart. So okay awesome. So, I got so excited about the events I think I cut you off. You were talking about the marketing person.

Chris Meade:

Yeah so we got that. I mean the events thing that's huge for us, absolutely huge. So excited for that to get back. We have a creative director, all the campaigns, all the management like we talked about we're doing very little with email and now we have somebody creating campaigns that go out to our email list which is well over 100,000 people now on a weekly basis. And we have campaigns We're now in Dick's sporting goods, go drive to sales to Dick's and then Dick's emails me, "Why did we get so many sales so quickly? Let me reorder." So, they all work on top of each other like you talked about so.

Brett Curry:

That's great. That's great. Are you going to be pushing for more physical store retail distribution?

Chris Meade:

Yeah, that's the goal. We started the company, we saw this as a retail product. It was never like, "Shopify D to C only like this is exclusive here." We're like, "No, we want to go..." Going into the store and seeing your product on a shelf is just the best feeling of all time.

Brett Curry:

Yeah it's super cool. And they're still, I mean and because of the pandemic, the acceleration of e-commerce penetration and growth has been amazing. So, it went from I think Forrester said it was 16% of all retail was eCommerce pre-pandemic. And during pandemic that went to 20 some percent and I saw some reports were 30 some percent but that still means 70% is in a store. And so, there's still some people they want to touch it, feel it, see it before they buy it. It's like Bass Pro and all these other, Walmart you can be in. And so yeah, really excited about that for you.

Chris Meade:

Yeah so we got a Dick's Sporting Goods which is awesome. We're about to expand nationwide with them it looks like. Academy Sports nationwide, nationwide working on Walmart and Target right now we're on Walmart and target.com selling great. So retailers should be at least 20 to 25% of our business by the end of the year hopefully.

Brett Curry:

Awesome. Awesome, man. That's so cool. Okay, fantastic. So, people want to learn more, people want to say, "Okay I'm picturing this in my head. I've got to go see what this looks like." Where can they learn more and where can they get their very own CROSSNET?

Chris Meade:

Crossnetgame.com, the best place to support small business.

Brett Curry:

Yeah, I like it. Chris man, thank you so much it's been a blast, loved talking entrepreneurship and CROSSNET and online marketing and all this fun stuff with you. So, I really appreciate you taking the time and checking in virtually here.

Chris Meade:

I appreciate it man. Thanks so much for having me.

Brett Curry:

Yep, absolutely. And as always thank you for tuning in. We would love to hear feedback. We would love to get that five star review on iTunes if you feel so inclined. It does help other people discover the podcast which is a good thing, at least I think. And so, with that until next time thank you for listening.

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Episode 123

:

Jeremy Horowitz - Messenger Mastermind

Massive Product Launches and Building Replenishment Engines

Jeremy Horowitz helped create the marketing engine behind Lumee, the selfie phone cases made famous by the Kardashians.

Jeremy Horowitz helped create the marketing engine behind Lumee, the selfie phone cases made famous by the Kardashians. He now helps growing eCommerce brands create 6 figure + product launches. He also builds what he calls “replenishment engines” - a concept that was new to me but that I absolutely love.

Interested in doing $100,000+ in sales in 24 hours on a new product launch? Want to know the secrets of building huge demand, selling out of products, and generating real urgency like Supreme, Jordan and Kylie Cosmetics.

Here’s a quick look at what we cover:

The difference between a product launch that sells out vs. a “meh” launch
How to create a “web” so that your customers are highly engaged and eager to buy
How to build anticipation, excitement, and generate huge sales without discounting
How to utilize messenger marketing and Facebook private groups
Lessons from movie launches
Plus more

‍

Mentioned in this episode:

Supreme‍

Apple‍

Jeremy Horowitz - Host of the Messenger Mastermind Podcast

Messenger Mastermind

Messenger Mastermind Podcast

Via Facebook Page

Via Facebook Group

Apple Podcasts

Stitcher

Spotify

Messenger Mastermind Podcast - Episode 64 - Instant Exposure on YouTube with Brett Curry

PDF RESOURCE - Discover How to Increase Product Launch Sales Using the Channels You Already Have

Episode 122

:

David Wachs - Handwrytten

Secret Marketing Weapon - Automated Handwritten Direct Mail

We discuss creative and affordable ways eCommerce companies can use Direct Mail to build customer loyalty and increase sales.

You walk to your mailbox. Inside you find a hand-addressed envelope. It looks like it could be a thank you note of a birthday card. What are the odds you open it? 100%.

I love direct mail. Especially now because mailboxes are nearly empty (compared to 15-20 years ago). In this episode I interview David Wachs, CEO of Handwrytten. We discuss creative and affordable ways eCommerce companies can use Direct Mail to build customer loyalty and increase sales. We also discuss how his technology allows for automated handwritten notes...it’s pretty fantastic.

Here’s a look at what we discuss:

How to use handwritten thank you notes to increase referrals
How an online fashion company sent 700 handwritten notes, scored a 16.8% redemption rate and drove an ROI over 300%.
Using direct mail to build your loyalty program
Leveraging direct mail to get more positive reviews and/or mitigate negative reviews
Launching direct mail Win-back campaigns
Abandon cart direct mail sequences
Automating handwritten thank-yous
And more!

‍

Mentioned in this episode:

Zapier Integrations

VNYL - Vinyl Record Membership Club

Zendesk - Customer Support Ticket System & Sales CRM Software Company

Salesforce

HubSpot

‍

David Wachs - CEO and Chief Robot Mechanic at Handwrytten

Handwrytten - Handwritten Notes Platform

‍

When you signup with Handwrytten using your email, use discount code, “podcast,” for $5 credit toward your first purchase.

‍

Episode Transcript

Brett:

Well, hello and welcome to another addition of the eCommerce Evolution Podcast. I'm your host, Brett Curry, CEO of OMG Commerce and today, we are going old school with a twist. It's like the blending of old school and new school, if that's even a term, I don't know. We're going to be talking about a very proven marketing tactic that I almost guarantee you're not using but you should consider and we're going to have a lot of fun talking about it.

Brett:

So, we're talking about handwritten direct mail and I believe handwritten direct mail could be a huge part of your marketing secret weapon, something you do that your competitors are not doing and something that will allow you to break through the clutter. I'm actually a bit of a direct mail connoisseur. I used to do some direct mail in a previous life, so we'll talk maybe a little bit about that.

Brett:

My guest is Mr. David Wachs. He's the CEO and chief robot mechanic, we'll learn what that means in a minute, of a company called Handwrytten and so with that, David, welcome to the show. Thanks for coming on and really excited to dive into this topic.

David:

Pleasure to be here, Brett. This is super cool that you're having me on.

Brett:

Yeah, yeah, yeah. So let's talk a little bit about your background and what was the inspiration for this company and then tell people what you do and then we'll dive into some really interesting stats about direct mail and email and some other things and then get into some practical stuff too. So, walk us through kind of a 90-second story. How did you get here?

David:

For sure. So back in 2001, 2002, I started a text messaging company called Cellit and what Cellit did was we ... Initially, it was for real estate, you drive by a house, you'd want info on that house. You'd see a little sign and it'd say text for info on this house. You text and you get the info and then the realtor would get a lead and this was way before the iPhone and that grew out of just real estate to just general marketing. So we'd work with ... We started a second product called CouponZap for restaurants and bars but that quickly became used by Abercrombie & Fitch and Toys "R" Us and Sam's Club and these other large retailers and stuff like that.

David:

And what I realized in doing this company was while text messaging works, I saw a decline in usefulness because the total volume of texts and emails and tweets when I started Handwrytten back six years ago, people were getting overloaded with electronic communication and you hit the nail on the head when you said handwritten notes cut through the clutter. So, basically, what happened was I sold my company in 2012. I had to stick with the new owners for two years and then in 2014, basically, the day after I finished up my last company, I thought gee, there has to be a better way to improve handwritten notes and the reason I did that is when I sold the company, I sent ... I wanted to be personal, so I sent handwritten notes to my clients. I sent handwritten notes to my employees and my hand started cramping up or I'd notice when I'd go to send a handwritten birthday card to my mom, I'd go to the store to get it but then I'd forget to mail it or I didn't have a stamp or whatever. So, I thought there has to be a better way.

Brett:

There's also that problem of no auto correct and/or no spell check because I do that with cards now. I'm so used to typing and I type fast but I'll write a card and I'm like ah, I didn't mean to write that here. I need to move this sentence here and like I can't do any of that. Anyway.

David:

Yeah, absolutely, absolutely. Otherwise, your note's all scratched out and everything else. Like when I send an actual handwritten note to my wife or whatever for her birthday, it looks terrible because it's all scratched out . So that's why we started Handwrytten and the idea was to use technology to make sending a handwritten note as easy as sending an email or a tweet or whatever else and we do that through software on the front end, so we have an iPhone app, an Android app, a website, Zapier integration, which is probably big with all your Shopify users.

Brett:

Yup, for sure.

David:

A full API and a website where you can upload bulk orders and then on the backend, we use technology to actually write the notes. So there, currently, we have 95 robots. These are actual robots. We build them here in our facility in Phoenix, Arizona. They're a combination of 3D printed parts, laser cut parts, conveyor belts. I mean we make everything down to literally the rubber wheels that pull the paper along. So, those robots then write out your handwritten note in the handwriting style of your choice including your own handwriting if you pay for it and then we stuff and stamp it with a real forever stamp and send it on its way. It looks totally realistic

Brett:

These robots actually ... They actually have ... And they're using an ink pen, right? So they're actually ... The robot is moving the ink pen. So it looks like ink on paper with pen because that's what it is.

David:

Exactly, and it smudges. We actually just use a Pilot G2 ballpoint pen, which you could pick up at OfficeMax or Staples or whatever else and then people give it the smudge test. They'll lick their finger and make sure that the ink smudges and laser print ... People say why don't you just laser print the notes, it just doesn't look the same. If you laser print the handwritten note, the way the ink falls on the paper with a laser printer is very different than with a pen and we want this to be a fully ... And in fact, we think if you send somebody a fake laser printed note, it could actually hurt your brand rather than help.

Brett:

Right, you're trying to trick me. You're trying to trick me into the fact that this is handwritten but I know it's not, so you actually lose points.

David:

Right and I mean there is potentially if you're really ... Some people have that concern about this because it's not actually written by you but it's very, very close to the point that I see these notes coming off the machines, I see the robots writing them, I look at the end product and I have a hard time telling it's done by a robot.

Brett:

Yeah, yeah, yeah, yeah. I'm confident it will pass the smell test with almost everybody if not everybody. So what's interesting and I mentioned this in the intro, I've been a marketing junkie for a long time and I did a decent amount of direct mail back in the day for myself to grow my first agency and to help clients grow and there was one thing I learned early on is there's two types of mail that you always open. One, if it's something that's handwritten because you're wondering who is this? Is this a friend? Is this a family member? What is this? It's handwritten, so I have to open it. And then something that's like three dimensional, so something that maybe you can tell there's something in it, almost like a prize inside or a gift, so we call that lumpy mail and 3D mail.

Brett:

But you send one of those two things, it's going to get opened. If it looks like we use the term marketing mail instead of junk mail, but if it looks like marketing mail, probably not going to get opened. And what's so interesting and I want to dive into ... You talked about email and text messaging, those being kind of overloaded, I want to talk about that in detail in a minute, there was a time when mailboxes were overloaded too. Where you would open your mailbox and it was just crammed to the gills with flyers and circulars and postcards. I mean it was just like spilling out. That's not the case anymore. I mean that just does not happen anymore. The mailbox is relatively empty and so I think it's a huge opportunity.

Brett:

Let's talk about this electronic communication and what kind of led you to pivot from your old company. Enlighten us. What does it look like now in terms of email marketing and text messaging? How much are we bombarded on a daily basis with those messages?

David:

Yeah, for sure. So, just some stats, the average office worker these days gets about 147 emails a day according to one survey and I could get you where this is from, 28% of average office worker's time is spent just dealing with email and then 35 to 44-year-olds sends or receives nearly 1600, 1-6-0-0, texts per month and an 18 to 24-year-old sends and receives nearly 4000 per month. So it's all these electronic notes getting pushed around. There's a very high likelihood your electronic message might get lost in the shuffle. As far as print, 44% of all, what I call junk mail, which is fully reproducible photocopied mail, 44% never gets opened. The typical response rate for print pieces is under 5%. It's more like 4.4%. But when you combine even just a handwritten envelope, you see a 300% higher open rate than a standard print piece.

Brett:

Wow, wow.

David:

So, it's just to your point exactly, people are wondering who wrote me this note? What's this all about? We get a lot of questions, do we do postcards? And yes, technically we can but there's something about that experience, to your point, about getting something that's handwritten and taking the moment to open it because you're wondering what's in it, so we really don't do a lot of postcards. We think that it's a much better experience to just do handwritten notes or handwritten-

Brett:

that envelope that is hand addressed, when you get that, there's like this experience of anticipation, what is it? Who's it from? I want to find out. So it's almost like a .. as you get that, you want to know and you enjoy that and then you're also more engaged then as you read that piece whereas if you send a postcard, it's all revealed instantly. What is this? I get it.

David:

Yup, yup. According to the greeting card association, and this is back in 2006 study, 64% of Americans prefer handwritten notes to electronic communication and what I find and what my clients find is people put these notes on display. Like you put it on your desk, you stand it on your desk or on your bookshelf behind your desk. If you don't have a stainless steel fridge that can't accept a magnet, maybe you magnetize the note your grandmother gave you to your fridge. We have a lot of clients that are taking the handwritten notes that they send their customers and they're putting them on Instagram and Twitter and that type of thing.

David:

So, for instance, we have a client called Vnyl, V-N-Y-L. They're one of the few brands that lets us mention them but they're a record box subscription. So they're literally sending vinyl records in the mail and with those records, they're sending a handwritten note. You can just go on Twitter and search for Vnyl and you'll pop up a bunch of people taking photos of those notes.

David:

We work with a YouTube show that's like one of the number one morning daily YouTube shows and they have a fan club that you can subscribe to and as part of this fan club, you sign up to get or you get a handwritten note from the host of the show and that note is tweeted all over the place and it's funny because that client doesn't mix up the note at all, so the content is always exactly the same and people post these notes and they're so excited to get this handwritten note from the host of the YouTube show and they just don't even notice that all the notes read the exact same. I think they could actually implement that a little bit better by mixing up the message a bit but even without that, their viewer base is thrilled to get those notes.

Brett:

It still works. It still works. Yeah, I'll give you a quick example and this is a longtime client of mine and they're also a friend, been helping them with marketing since about 2004, I think, but it's as jewelry store and they actually hand write thank you notes. If someone makes a purchase, the owner or the salesperson will hand write a note. It's a little easier for them because you're not talking about thousands of transactions a month, it's probably more like dozens for each salesperson but even on ... They're a client of mine, I purchased something for my wife there recently and I got a handwritten note and it's interesting because it's still sitting out. It's in our room. It's on display. I see it all the time. I feel weird throwing it away. It's something that someone took time to hand write it and send it to me. So I think it's one of those things that the value, the goodwill that's generated, the intention that's garnered, it's disproportionate to the cost associated with it.

Brett:

Where it's like the perceived value, the relationship building that this creates is super valuable and what's interesting and we talk about it on this podcast a lot is we're building brands here, right? We're trying to establish customer relationships and build lifetime value for the customer and really build a brand so that you can one day maybe sell your eCommerce business or just continue to grow it and I think this is one of those elements that can build immense loyalty and repeat purchases and referrals and several other things and I would almost guarantee that none of your competitors are using this tactic.

David:

Yeah, I mean all of your clients, I'm guessing, or most of them are online only and they don't have that face-to-face relationship with their customer but sending a handwritten note is a very personal communication mechanism and what's funny is most of our clients, well, I'd say about half of our clients are online brands too and they're beating out the brick and mortar brands by doing this because typically, the jewelry store, you were lucky that you got a note from a jewelry store. Most people just don't have the time anymore.

Brett:

Right.

David:

They're too busy dealing with their emails that eat up 28% of the day. So, being an online brand and being able to automate this gives them a real edge, and we're doing this for some luxury brands, just their online purchases. We're doing this for luxury brands where we're doing it for all their sales and they're seeing that it really is impacting the bottom line, creating repeat purchasing or extending if it's a subscription offering, extending the lifetime value of that customer.

Brett:

That's awesome. So let's talk about some specific uses. I know we've kind of alluded to a couple but how would you suggest an eCommerce company utilize these handwritten, hand addressed notes?

David:

Yeah, so I would not ... Handwritten notes are always going to be more expensive than laser printed or junk mail because the first thing we have to do is write on something and a printed piece is what we write on. We write on a piece of stationary. So we can never compete with junk mail because A, that's a less quality piece of paper than we'd even write on but we have to print something first just like junk mail is printed. So, I would not recommend doing a blast to everybody in a zip code or everybody in the United States. As much as we'd love the business, it's going to be too expensive. But that said, we do a lot of followup with clients and oftentimes, this is just the thank you. They're asking thank you for a few reasons. One, because they just want to build the relationship with you. They also want to keep the reviews coming. So if they're doing anything on Amazon or Yelp, they want you to go back and place a good review.

David:

So, it's for placing good reviews. It's also for mitigating bad reviews. We have one fulfilled by Amazon seller that is strictly using the notes to keep people from putting bad reviews in. So they'll say, hey, we're so glad you purchased this product. If you had a bad experience, please let us know. We'll make it right before you go place a review. So, they're doing that for that.

Brett:

Do you have any stats on what that's ... And I'm sure it's been effective but any specifics on how that's helped mitigate bad reviews?

David:

I don't have any stats. I did do lunch with a client and they said that was their main use and they keep re-upping with us just for that. So they're not interested in keeping the good reviews coming. They found true effectiveness in bad reviews but quite frankly, I don't have any stats there.

Brett:

Yeah, yeah, yeah.

David:

I do have good stats on a couponing campaign. So we have a client, they're a bespoke suit manufacturer based out of Canada. So what they'll do is they'll take your measurements and then they'll go farm it out to China, get you a beautiful suit made just to you and then mail it to you. Their CEO sent out 700 coupon codes and handwritten notes and each coupon code was unique to the customer. All notes were signed by the CEO, so we replicated the CEO's signature. They had a 16.85% redemption rate on

Brett:

What? 16%? That's unheard of. That's insane.

Brett:

Were these previous buyers or just people on a particular list? Okay, yeah.

David:

They were previous buyers that were high value buyers and they saw a return on investment of over 300% from that campaign.

Brett:

Wow.

David:

We have a meal box that puts five different messages on five different cards, so if you're with the meal box for five weeks, you'll get one of each of these cards and they find that providing those handwritten notes in the meal box improves customer retention by over 10%, which really moves the needle for them. Who else can I mention here? We've had one client that's a sales organization. They find that when they started sending handwritten notes to their sales prospects, it improved the meeting booking rate by 300% again. So again, the 3 times numbers. There are a lot of stats that ... One of the more interesting is so far we've covered meeting bookings, coupon codes, general thank yous and reviews.

David:

We've seen people use it for shopping cart abandonment. So if you go through the steps and enter your address but then don't purchase the product, they might follow up with you with a handwritten note. I don't have any stats there. And then just anecdotally, we have a client that does snack boxes. So if you're an office and you subscribe to receive a snack box every month or every two weeks and it comes to your office, it's got beef jerky and chips and everything for your office, what they'll do is they've found that they intentionally send you the wrong box now and then two weeks later, they'll send you the right box with a handwritten note apologizing for the wrong box because they find by fixing a wrong, by righting a wrong and going through that drama with a client, they end up with a more loyal client than if that client never had a bad experience.

David:

Now, granted, that client is ... Yeah, the client's still getting a free box of snacks because they got the wrong one and then the right one, so they're thrilled about that, but throwing in the handwritten note certainly doesn't hurt either.

Brett:

Wow. So, I'll tie that into an electronic version of that. I know for a while because I've got a lot of friends in the info marketing space, people doing webinars and product launches and things like that, there was definitely a tactic where you'd send an email without a link to something, so it's like, hey, going to be awesome. It's going to be all this stuff and then you send ... And then a few minutes later, you send an oops, forgot the link and that oops email would get a ton of opens and so that was kind of a tactic. That is fascinating, what you just shared because yeah, it's really a way to get ... You could almost think about that, just kind of riffing on this a little bit, you could almost use the wrong package you sent, like to give samples. So it's like hey, these are things that I think they might like. It's not what they ordered but I'm going to put it in here to kind of sample it and then I'll send them the right order with an apology.

David:

Yup.

Brett:

That's really, really smart. So I want to kind of break down a few of these because I think there's more we could talk about with a couple of these. So, the thank you for purchase, if all you did was send a thank you and you didn't ask for anything, you didn't mention anything, I think a few things are going to happen naturally. I think people will leave better reviews. I think you will get more repeat purchases but I think it's better to not leave things to chance. I think it's better to ask directly, as long as you ask in a cool way, in a way that still builds goodwill but I would suggest using those thank you notes to either promote a loyalty program, to promote a referral program ... It's been a while but I did an episode on referral programs with a guest and just talking about hey, emailing out, requesting people refer to a friend, giving each person a little bonus, like referral programs for eCommerce are super powerful. This could be a great way to do that and then I love the review mechanism as well. Like even ...

Brett:

I could see it going both ways. I think probably for most companies, the request for a good review is going to be the way to go and then my guess is and you obviously don't have to reveal anything but the client that you mentioned is mitigating the bad reviews, they must be in a ... It must be like a trick to use case or one of those products that's just prone to bad reviews and so they're trying to mitigate that. Lots that could be done there. Well, what about like a win back campaign. So you know we have a lot of clients that are selling consumables, so whether it's ever quarter or every month, people should be reordering. Do you see handwritten notes used as a win back campaign? I guess that suit company, that's almost a win back.

David:

Exactly. That's what I was going to say. That was kind of their win back. It was also kind of a holiday offer they were doing. It's really kind of hard to stay on top of all the different use cases we're seeing. One that I use personally and this probably doesn't apply is when I go to a trade show, I try to get the prior to the trade show and then I blast it out and then I end up with so many meetings I don't go the trade show, I just sit in the lobby and take meetings but that's worked out very well. We have a lot of mortgage brokers, realtors.

David:

We have first level OEM car manufacturers, so think the big three. If you were to call them for customer support as opposed to calling your dealership, I don't know why you just wouldn't call your dealership but if you call the main number for the car brand, depending on the resolution of the call, you will get a handwritten note saying we're so glad you were able to resolve the issue or we were not able to resolve the issue, that type of thing. For a while we were, and we could talk about integrations later, we were trying to get an integration with Zendesk off the ground to make this super easy. Right now, you probably have to do it through Zapier or something else but just sending followups to customer support requests is something we do quite often.

Brett:

Love that, love that. Again, that just ... If you're able to fix the wrong and then that followup of the postcard, that's awesome. I order these organic vegan shakes, I'm not vegan but these shakes that I order are. They're like meal replacement and I get them monthly. They're super great. But I got an empty package this last month, like someone stole it out of my mailbox and then I contacted ... I'm not going to mention the company name because I don't want them to get bombarded with stuff like this, although I do trust my listeners but I contacted the company and they were like oh, we'll send one out right away and I got a replacement two days later and they followed up with me, which was amazing and so now I love them even more but if I got a handwritten note with that. Oh man, that would've been ... That would've been even more impressive and I would've been telling more people about it probably.

David:

Yeah, and then just to keep it ... The meal boxes do this but also it's like online mattress brands and stuff, they'll include a handwritten note in the product and this is a really easy way to do it with Amazon or anything else where you don't have too much control anymore of knowing who your customers are, so just including a generic note in the product, it at least makes it appear that that company is run by real people and it's not just-

Brett:

Yes, yes.

David:

Fulfilled by Amazon and made in China.

Brett:

Yup, yup. Yeah, that's super smart. Yeah, so even if it's or something fulfilled by Amazon and you can't personalize the note, at least it still looks handwritten and then that causes people to say this is a real company, maybe even a small company, like taking care of them, which is cool. Let's talk about some integrations then. What do you integrate with and how could someone maybe automate some of these processes?

David:

So, we integrate ... We have a full API that allows you to integrate with whatever you want but out of the box, we integrate with Salesforce.com, Zapier is the big one and HubSpot. So, for Zapier, we have a lot of people using two or three-step zaps for sending handwritten notes from Shopify. So the first step might be a filter and anybody that's not familiar with Zapier, Zapier is like the coolest thing and any of your Shopify users should go check it out right away but it allows you to connect Shopify to 2000 different services, Handwrytten is one of them and you can create pretty complex interactions or flows just by clicking your mouse and what a lot of people do is step one of that flow is what's called a filter and you can say, okay, every time I get an order from Shopify, that's the trigger, let me filter it and see is this the nth order.

David:

So, maybe I want to send this the 10th time somebody buys or maybe I want to send it when their total value of being a client is over a hundred bucks or maybe I want to send the note on their first order. You can set all those filters up right within Zapier and then you send it to Handwrytten and Handwrytten will just write out whatever note you want. It could include a category. So thank you so much for your purchase of these blue plantain chips or whatever that is and then we're a small company. Let us know what we can do to serve you better and then you'd sign it off and then that note would go out automatically. Thanks to the post office, notes take four or five days to get there, so it might naturally be a nice flow for extended communication with a customer or you can insert a delay within Zapier so that maybe it doesn't go out four or five days later, maybe it leaves Handwrytten five days later, then it gets another four or five days from the post office and gets there 10 days later, whatever that is.

David:

You could set up when you get a new customer in Shopify or your store, if you happen to have their birthday or anything like that, you can send a followup on their birthday or on their anniversary of being a client, all that's very easy to do. Really, the possibilities are kind of endless with Zapier. In that note that you send them, in addition to sending a handwritten note, we can do customer inserts. So we could include a physical coupon card or gift card-

Brett:

Business card, whatever.

David:

Yeah, yeah, exactly. All of the notes can be written on their stationary. It's real easy to go into Handwrytten, create a custom piece of stationary and then within Zapier, you just select that stationary and it will use that moving forward. So the whole process can look very custom and the return address is your return address too, so it'll look entirely natural. The one giveaway and I would say 99% of our customers don't care about this but the postmark is going to be Phoenix because that's where our facility is, but nobody looks at that. They all look at the return address anyway. So it's not that big a deal.

Brett:

Yeah, nobody looks at that. That's like you got to be in the business of direct mail to look at where it's postmarked from or old school when you used to get tons and tons of direct mail but yeah, today, no way are people going to notice that.

David:

Yeah, you're asking actually about other stores. We have one pet food company and they know the birthday of your pet and on the birthday of your pet, they send you little party hats for your dog or cat in a little package that we put together. So it's a handwritten note and then these little party hats are filled together and then you're supposed to take a picture of your animal having a party and then of course, those go to Instagram and do the that way.

Brett:

Yeah, and I sure people take a picture of the card at times and then they have the hats and stuff, that's really, really cool. Really smart. Well, David, this has been fantastic. So, let's talk about how could people connect with you? How can they learn more? How do you make it easy to get started? Kind of walk through those if you would.

David:

Oh sure. So you just go to handwrytten.com, that's H-A-N-D-W-R-Y-T-T-E-N.com, so handwritten with a Y. I'm on Twitter, David B Wachs, sorry, I had to remember if there was a middle initial. So, D-A-V-I-D, B as in boy, W-A-C-H-S or Handwrytten@handwrytten on Twitter and yeah, we're here for you. We've got a great call center team able to answer questions or just go online, play with it. There's no cost to get started. If you do sign up with an email and password as opposed to using Google or Facebook, use discount code "podcast" for $5 credit for your first purchase and that'll be enough to get you maybe even two cards because we're running a discount now given COVID-19. So, yeah, so you'll get a $5 credit on your account, just go to handwrytten.com, sign up using discount code "podcast."

Brett:

That's amazing. And so I'm assuming you guys can also help give some guidance or some ideas on hey, if I want to set up a Zapier integration and I love those ideas you gave by the way. I think the first purchase thank you card is amazing. I think maybe once they get to five or 10, whatever's meaningful, another handwritten card and then maybe if you're going to launch something like a referral program or loyalty partner, I think a handwritten card for that would be great too, but can you give some guidance or some help on setting up Zapier?

David:

Yeah, yeah. You can email us and we'll try to walk you through it. If it really requires it, we'll get on a Zoom call with you and do a screen share and kind of help you point and click your way through it. Most of this should be pretty straightforward but we're always here to help and then if any of your customers use HubSpot or Salesforce, we're able to help them there as well.

Brett:

Fantastic. Well, David, this has been a ton of fun. I love this tactic and I think of all the things that I've seen, I remember when the handwritten fonts used to come out but it was all laser jets, like eh, it's okay. Like this is definitely the coolest thing I've seen when it comes to handwritten direct mail and I think this could be a real winner and a real differentiator. I think this could be a very, very powerful tactic for those who are listening.

Brett:

So, David from Handwrytten. I'll link to everything in the show notes. But thanks for coming on, man. I really appreciate it and yeah, look forward to talking to you again.

David:

Thank you so much, Brett. You be well. Stay safe out there.

Brett:

Yeah, you as well and with that, we'd love to hear feedback from you. Let us know what you thought of this episode and give us some ideas for other episodes. We want to make sure we're delivering the content that you want to hear. If you feel so inclined, we would love that five-star review on iTunes. That helps other people discover the podcast and with that, until next time, thank you for listening.

Brett:

All right, man, that's a wrap.

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Episode 121

:

Brett Curry - OMG Commerce

5 YouTube Ad Tactics to Scale Any Business

Before all live events were cancelled I presented at Social Media Marketing World 2020 in San Diego. My talk covered the latest tactics and

In early February before all live events were cancelled I presented at Social Media Marketing World 2020 in San Diego. My talk covered the latest tactics and strategies we’re using right now to scale on YouTube. This is the recording of my presentation at this paid event. Here’s a quick look at what I cover in this talk:

Could YouTube be your next big thing?
2 Proven Ad formulas for cold traffic
Ad formulas for warm traffic
What is progressive audience testing and how to use it
How to leverage YouTube and Google Display Network together
Plus more!

‍

Episode Transcript

Speaker 1:

Five YouTube ad tactics to scale any business, so it's all about YouTube and advertising. A bit about Brett and then we'll get this show on the road. Brett is the CEO of OMG Commerce, an e-commerce marketing agency and Google Premier Partner. He started his first marketing agency way back then in 2003 and launched his first search engine marketing campaign in 2004. He's the author of several books including, The Ultimate Guide to Google Shopping. He's also host of the eCommerce Evolution Podcast, highlighting in fact what's new and what's next in e-commerce. Ladies and gentlemen, y'all know what to do. Can you put your hands together and join me for welcoming... Don't do that yet. I want you to hold that fire. Hold it, hold it, hold it. Keep holding it like a spring with tension.

Brett:

Hey, Brett Curry here. Before we dive into today's topic, I want to talk quickly about YouTube ads.

Brett:

People ask me all the time, what makes for a great YouTube ad, and it's true. The ad is the hardest part for getting YouTube to work. Now, I love the campaign structure. I love audience targeting. And I love tinkering with bids and using the smart bid algorithm. And I even liked budget management. I like all that behind the scenes stuff, but I've seen it time and time again where the exact same campaign structure just limps along with a mediocre video. But you get the right video with the right message that resonates with people, and that same campaign structure just takes off, it scales.

Brett:

And so over the last couple years, my team and I, we've been collecting good YouTube ads. We've been watching, we've been paying attention and looking at our own clients, looking at the numbers, finding what are ads that resonate and work on YouTube? And so we started building this little guide, this little guide that we use internally and we started categorizing ads and giving them fun names like the Manifesto and the UGC Mashup and the Have-it-all. And so we started kind of breaking down what elements in these videos make them work. And so I was speaking at a recent event and I just happened to mention that this resource existed and people sort of clamored for it. Everyone was like, "Hey, I want to see the guide, I want to see the resource, I want to see all these successful ads." And so that's what we've done. So we put together this resource kind of first time ever going to share it with a broader audience. It's free. So check it out and get our list of winning YouTube ad formulas with lots of examples. Let this be your inspiration for your next killer YouTube ad.

Brett:

So this is a free resource. We'll link to it in the show notes to this show, but you can also go to omgcommerce.com, click on resources and then guides and it's the YouTube ad templates and guide. Check it out, and I hope it inspires your next killer YouTube ad campaign. And now back to the show.

Speaker 1:

Now, ladies and gentlemen, y'all know what to do. Join me in welcoming the amazing, the admirable Brett Curry.

Brett:

That was awesome. I love the energy and so I want to keep this as high energy, as high impact as possible and also super practical, super useful. So we're going to get practical, we're going to get strategic, we're going to get tactical a little bit and hopefully you'll walk away with the tools, the tips you need to excel with YouTube advertising. So, I want you to put hands because I couldn't really see over here, how many of you are currently not advertising on YouTube? That is a lot of you. Most of you. Okay, how many of you are advertising on YouTube or you're really just getting started? Just dipping your toe in the water, just getting going. Okay... All alright, dude stood up. I like that. How many of you, you're advertising on YouTube, you're doing well and you just want to take it to the next level? Anybody there? Okay.

Brett:

Several of you raised your hands I feel like three times. I don't get that. But you're just excited like, "I'm just going to raise my hands. I'm really excited to be here raise the roof." So, to kind of set the stage, I want to look at how people are interacting with YouTube, how they're using YouTube, and how we use it to influence the shopping journey. So let's dive in just a little bit. So what you're probably asking yourselves is, could YouTube ads be the next big thing for our organization, for our company? And I still talk to so many people. I do a lot of work in the e-commerce space and there's so many e-commerce companies that are advanced with their Facebook advertising and they either haven't done YouTube at all or they've just dabbled in it, which sounds like you guys, right?

Brett:

But YouTube is massive. So why are we not using it? Why is it not the thing now? But I think I've got some theories that we'll talk about. Yeah, cash, absolute budget, but I think also is comfort level and know how for some key areas. I want to hopefully help solve that today so that you can ramp up your YouTube efforts and make it the next big thing for you guys. Now what's interesting, this is my third social media marketing world event in a row. And talking about YouTube ads the whole time, the first year. So I guess maybe I'm not being very successful if more of you aren't advertising. It's the third time I've tried to talk you into advertising on YouTube and the numbers are still low. But what's interesting is that three years ago I was just talking about YouTube remarketing and now we've kind of scaled to all encompassing full funnel YouTube. But this number was 1 billion.

Brett:

So it's global users, but that number, three years ago was 1 billion. It's doubled. The rate of growth on YouTube right now is still astonishing, but what's more important for that coveted demo, 18 to 34, how many of you would say 18 to 34 is a key demo for your product, right? So more people in that demo consume YouTube on mobile alone than on any TV station. Broadcast, cable does not matter. More people in that age group on mobile alone, not counting desktop consumption of YouTube, they're more engaged there than on any TV station. And you've probably seen this stat before, but this is such a key indicator of how people use YouTube, right? It is the number two search engine right behind Google. And so people go to YouTube for those learn, do and buy moments, right?

Brett:

"I want to learn how to fix the lawnmower," right? I have a son, he's about to graduate high school. A couple of years ago I saw he was searching how to ask out girls, right? And the good news is he's got a girlfriend and so YouTube worked. I was a little bit honestly offended that he didn't ask me. I was like, "Hey, do you not think your dad has game?" And apparently he doesn't think that I do and he's actually probably right. But we find what we want to find on YouTube, right? It is the number two search engine. And not only that, it's the number two most trafficked website on the planet, right? Again, second to only Google. So you want to scale your organization, you want to scale your reach, YouTube has scale more than any other platform but it also has these really specific focused niches, right?

Brett:

So I'm not into model trains but this is interesting. So this is a model train channel, almost 25,000 subscribers. Some of their videos have 700,000 views, right? So you want to go really deep on something interesting and something specific, that's available on YouTube as well. So just a couple of quick things about our company to kind of set the stage for what I want to talk about, we do this on a day in and day out basis. So we craft YouTube campaigns, we manage those campaigns for large e-commerce clients. Team of about 38 now and growing. And for agencies our size, we're one of the top spenders on YouTube. So everything I share today is going to based on real campaigns, real data. Stuff we're doing and testing, we've done a lot of things that did not work and we found a lot of things that have worked. And that's we're going to talk about today.

Brett:

Also, and this is more of like for another day, but I want to mention it, we did make the Inc. 5,000 list this last year, but I'm even more excited we made the Inc Best Workplaces. And I'm a huge believer that if you have the right culture internally and you treat your people right and you create and foster this environment of helping each other level up and honest communication and transparency and all these things we believe in, that translates into better business performance as well. So if you want to geek out about team building and things like that, I would love to talk about it. Couple shots of our team, that's us at the Google Chicago offices. In the lower left, that's at our Christmas party. I was wearing Christmas jammies. I don't know why I selected that picture, but it's a fun one and it kind of encompasses who we are as a team.

Brett:

So quick question. Oh man, the clicker didn't work and I had to click it multiple times and that just ruined the greatest reveal in this whole presentation. Okay. Anyway, pretending you didn't see what you just saw, what is the first thing you think of when you think of YouTube? Cat videos, right? Now I just researched this. I Google it because I wanted to know how many people are dog people versus cat people. So dog people, yeah, let's just see if this is true. Cat people? Yeah. But cats rule the internet. So it's like 60% identify as dog people, 11% identify as cat people and the rest of us, I don't know what we identify ourselves as. I like them both just from a distance.

Brett:

So I just want to share a couple of things that are interesting. So 2 million cat videos on YouTube right now and 25 billion views for cat videos. So if you learn nothing else from social media marketing world, you can come back with some real science behind cat videos. And not only that, I won't stop there. This is the first cat video largely believes... I guess I'm going to stand here, largely believed to be the first cat video ever produced. Now the dude behind the cats looks a little bit eccentric to me and that's Professor Welton and he was making these cats box. I can't confirm that no cats were harmed in this video, but I can confirm this was the first cat video. So there you go. You're walking away with some serious knowledge.

Brett:

More importantly though, for our discussion and looking at how does YouTube influence buying decisions, whether that's for a physical product or a service, 80%, this is a study Google did, 80% of people now say they switch between search and video when they're trying to find a product to buy. So I either find the product on search and then I go to YouTube to watch demonstrations and reviews or I discover it through YouTube and then I go to search to learn more, but 80% bounce back and forth in the process of their buying decision.

Brett:

A third of all shoppers now say they've purchased something that they discovered on YouTube first. And this is really interesting because I think this will shape how we use YouTube to influence buying decisions. Those that experienced YouTube in their shopping journey, 80% said it was at the beginning of that shopping process. So this kind of awareness audience or the cold audiences which is what we'll talk about in a minute, they're abundant on YouTube, we'll talk about how to reach them.

Brett:

For teenagers, this is and I referenced my son looking at how-to-pick-up-girls videos on YouTube. If you look at teens, the three most popular platforms now are YouTube, Instagram, and Snapchat in that order, and YouTube does lead the day. So bright things ahead for YouTube. And now over the last couple of years, which-product-to-buy videos have doubled in watch time, right? So people are going to YouTube looking for things to buy, okay? But really ultimately, this what counts, right? So this is what we do on a day in and day out basis, helping companies scale to $1000 a day in ad spend, $25,000 to $100,000 a day in YouTube ad spend and while hitting cost per acquisition or cost per conversion targets or return on ad spend targets. So anybody likes the sound of that, getting that kind of scale while hitting your numbers on YouTube. Does that sound good?

Brett:

Okay, lots heads now. You wore out yourself with all the hand raising before and I was just like, we're just gonna nod. So this is what I want to talk about. And at its simplest form, this comes down to right message, right person, right time, right? How do we do that on YouTube? That's we're going to dive into and talk about. And so really as we look at kind this progression of how someone makes the decision to buy something, they go from not aware to then considering, to then buying to then hopefully becoming a loyal customer, YouTube can influence really every stage of that journey. But we're going to kind of focus on a couple of key areas today.

Brett:

And so let's talk about key number one. So we have got five keys. I'm going spend more time on this one than on the others because this is the hardest one to master. I believe, after talking to a lot of people about YouTube ads, one of the main reasons people don't invest in YouTube ads is because the creative aspect is perceived to be difficult, and it can be. And often the videos that work on Facebook are not the videos that work on YouTube. So it is a different animal. So what I want to do is I'm going to share with you some of our favorite ad approaches, we call them ad templates, although there's lots of room for creativity. But some of our favorite ad approaches for YouTube, we'll break those down, I'll show you why they work, we'll look at some examples, it'll a lot of fun. And this is also the creatives we're talking about. So these are the pre-roll YouTube videos, right? Those skippable ads that show up before you watch your cat video, these are the ads we're talking about.

Brett:

So proven formulas for cold traffic. Let's start with that. That awareness level traffic or that cold traffic first. So people that don't know you exist, maybe they don't even know a solution like yours exists. How do we reach them on YouTube? What kind of video ad do we need? So I'm going to talk about two, I'm going to share some examples and break it down. So the hero story or the hero journey and then the explainer. So let's dive right in. So this is one of our clients, this is EF Ultimate Break. They're group travel for 18 to 29-year-olds. They have an amazing video. I'm going play it in its entirety because I think you'll learn a lot from it. And so here we go.

Speaker 3:

This is you, or at least it could be you. You've been Island hopping through Greece with a group of people you just met who at this very moment are cheering you on as you jump off a boat, which to be honest, is a little scary. But YOLO, FOMO, right? Right. We are EF Ultimate Break, the best way to see the world for anyone 18 to 29. We handle everything-

Speaker 3:

(singing)

Speaker 3:

... you just travel. We've got people that do this, people that do that, and people all over the world who literally plan every detail of your trip to make sure it's absolutely perfect. We love travel. Scratch that, we're obsessed with travel, which is why we make it as easy as one, two, three. Find your trip, pay over time, travel.

Speaker 3:

We believe experiences are better than things, but what we really believe is that experiences are meant to be shared like french fries. Seriously, if you're not sharing endless plates of delicious food with new friends and new places at all times, you're doing it wrong. And when I say endless, I mean endless. Yeah, that should do it. Oh, hey, that's your tour director, the true MVP at the EF Ultimate Break trip, besides you of course. They're with you the whole time to make sure you get to where you need to go, eat what you need to eat and do as a local do. They're one part travel guru, one part logistical Ninja and three billion parts, awesome.

Speaker 3:

All right. All right. You get it. Now let's get back to the good stuff. Travel is all about expanding your horizons, trying new things and learning a little bit about yourself along the way. But it's also about having baguette fights in front of the Eiffel Tower. So what are you waiting for? Jump.

Brett:

Sweet. Alright, so who's in? Who wants to go? Go on that kind of trip. Yes. So good. Now this is a slightly higher production value than what you have to use on YouTube, right? But this is a great example. So let's break this down. Why is this such an effective ad? How could you take this and apply it to your business? So really the idea here is that the prospect is the hero, right? You are not the hero. You are here to help. You help to guide this hero journey or help create this hero story for your prospect. Now this video literally opens with, "This could be you," right? "You're standing on the edge of a boat, you're about to jump in. This could be you."

Brett:

Now, you don't have to start with exactly those words, but that's what you want to paint, where you can say, "Hey, this is what your life could look like. You could experience this, you could be this, you could be in this moment, you could be doing this very things." So you want to give your prospect the ability to see themselves in the video doing the thing that you're showing? So this could be you. Give them a glimpse of the good life. "What would life be like if I was enjoying your product or your service? So what would that look like?"

Brett:

And then also we're talking about how we eliminate the scary or the challenging stuff, right? Because remember, you're here to guide on this hero journey or to guide to help create this hero story. And so for 18 to 29 year olds traveling internationally, it's overwhelming, it's a little bit scary because of the safety risks, "I don't know the language, I don't know where anything is," right? So they say, "We take care of all of it. Everything. We got croissant gurus and travel gurus and accommodation gurus, and all you do is travel. We handle the scary stuff or the challenging stuff. We take care of all of that."

Brett:

You really want to bring to life the top two to three benefits and show rather than tell, right? So, you talk about visiting the Eiffel tower and talk about the structure or whatever, but isn't it more fun, isn't it more like Zesteral to say, have a baguette fight in front of the Eiffel tower, right? And then to show that, show the joy and the experience and all that cool stuff, right? So, show, don't tell. And then if you can weave in some unexpected benefits. Now their primary market is female. They do attract more female travelers than male travelers. And so they decided to throw in Sander, right? So they're talking about, "Hey, your tour guide or the MVP beside you, they're going to help show you the food and the language and all that stuff, and could be a hunk," right? So this tour guide could be a hunk, a little added benefit, throwing some humor there, which is always nice.

Brett:

Overcome objections, right? What are the reasons someone would say no? In this case it's expensive, right? "So do I have to save for like three years before I travel?" Nudge, "Pay over time, go do it down. Travel now, pay over time." And then strong call to action they said, "Hey, jump in. What are you waiting for? Jump in." And then the call to actions actually that are visual are more on the learn more type of call to action, right? So, "Check it out. Get all the details here." So that's the hero story. Very powerful ad type.

Brett:

Now let's talk about something that's little more straightforward, a little simpler, a little easier to execute. Again, this is a slightly higher end version, but it does a beautiful job of displaying what an explainer could be. And you could do one that's much simpler. So this is very straight forward. This is going to be from Grammarly. So let's give this a shot.

Female:

If you write anything on your computer, you need to get Grammarly.

Male:

I write pretty much all day every day and Grammarly makes my writing better.

Female:

As a student, I like that it's free.

Female:

It actually is correcting everything as I'm writing it.

Male:

Grammar errors, spelling errors. It even helps me find the right words to use so I can say what I want to say.

Female:

It catches all those embarrassing little mistakes before I hit send.

Male:

I downloaded Grammarly around my freshman year because I was just horrible at typing.

Female:

Grammarly is like my secret weapon for writing papers.

Male:

It's the perfect tool for your resume. You don't want any errors when it's your first impression.

Female:

I use Grammarly for important emails, social media posts, which there are a lot of.

Male:

I've used every tool out there and Grammarly is by far the best for improving your writing.

Male:

Grammarly is making me a better writer and it's free.

Male:

I would recommend Grammarly if you were a student.

Male:

My family.

Female:

My peers, my colleagues. It's like having your own personal proofreader for free.

Male:

Download Grammarly for free at grammarly.com.

Brett:

Anybody here use Grammarly? I'm just curious. Whoa, holy cow, almost all of you. They're one of the top video ads spenders so you may have seen that before or others like it. And so this approach works and it works very, very well. So let's talk about it. It's a clear problem solution premise, right? "Here's the problem, here's our solution." Nothing fancy. Not a lot of creative lead-in, just problem, solution, right? And so really what this is doing is it's sharing why the problem matters and how the solution works. Now in this case, we've all made grammar mistakes or spelling mistakes on our social media posts or job applications or memos or whatever emails. And so they don't need to really emphasize the pain a whole lot because we all feel that, we all know that.

Brett:

So depending on your service, you may need to really dig into the problem a little bit more. They focus more on the solution because the problem is so instantly identifiable, right? So here's how this solution works. It corrects as you go, right? I'm writing and it corrects as I go. What this also does is it identifies who it's for, what it does and how it works, right? So, the who it's for, think about what all they did there. They have, young professional, they have a student, they have somebody that just likes to post on social media, they have someone applying for a job. So showing the who it's for, specifically who it's for and how it works, it corrects as you go. It's easy, right? You just install it and it works it's magic, right? So the explainer, very powerful ad template. And you can use it for your business. It could be simpler than this. You could have a actual customers doing the talking if you wanted to, but this approach just works.

Brett:

So let's talk really quickly about getting the right assets for warm traffic. So those two work fantastically well the awareness level traffic, you can use them in other places as well, but what about when someone already knows about you? Maybe they've been to your site, maybe they watched the video, but they still haven't said yes, right? So they consumed the video, checked out your lander, but they have not said yes yet, What ad types do we want to run for them? And talk about three and talk about the UGC or influencer mashup. UGC for those that don't know, user-generated content. So, user-generated content mashup or influencer mashup. We'll look at the longer explainer and then the expert interview. We'll go through these really quickly.

Brett:

So the UGC or influencer mashup, looks something like this where you're taking actual customer testimonials or actual influencer endorsements and you're mashing them together. So real clips, real testimonials, really using these to kind of highlight your top two to three benefits. So what are the top two to three reasons why someone says yes to your product or service? Find testimonials or influencers who talk about those two to three things, mash them together and now you get the beginnings of a great video.

Brett:

And then also you want to demonstrate the pride in the process, right? So not only show the person on camera but show them enjoying your product or enjoying the travel, enjoying the experience or whatever. Allow for some demonstrations to be part of this video as well. So UGC mashup, we've also used this to cold audiences it works there too, but it's fantastic for warm audiences.

Brett:

The longer explainer, this is really simple, but basically you're just taking your explainer and you're going deeper. So often, this is that explainer premise, which you're going deeper, three to five minutes. You're showing more science, more research, more interviews, more whatever, to really tip someone over the edge. Because what someone has said to you if they've engaged with your video or engaged with your site and have not bought is, "I'm not sold yet." Right? "I don't have enough information. You haven't given me enough yet to say yes." So the longer explainer is hopefully going to tip them over the edge.

Brett:

There's also one we've used, we use this with supplement companies, medical devices, even footwear. And so the expert interview, a couple ways you can do this. You can do like talk show style or in this case, this was an interview of a podiatrist and another doctor, some other variety as well, but he was talking about minimalist running shoes. And how typical running shoes actually weaken your feet over time, but this type of shoes strengthens your foot, it strengthens your arch. And so again, it's one of those things where, "Hey, maybe I'm thinking about buying that shoe because it's cool and because my outdoor running buddies have minimalist shoes, but I've seen a few things, haven't bought yet, now the expert interview is going to push me hopefully over the edge to say yes."

Brett:

Okay, so that was just a few templates. There's actually a lot more. So for the last couple of years, my team and I, we've been collecting good YouTube ads and so we've been seeing kind of what works, why it works. And so I've put together this free guide. You can get it without any strings attached of all of our top YouTube ad templates. And I provide links to videos, right? So we explain why it works and then links to some of these videos you can check out. It's at omgcommerce.com under resources. Click on guides, and then it's the YouTube ad templates. So check it out, walk through all of the templates right there.

Brett:

Okay, so key number two. So now we're talking right audience, right? So getting the right audience and sort of at the right time as well. We like to talk about progressive audience testing. So do we create this brilliant YouTube ad and then just turn it on and run it to the universe of YouTube when it's everybody is on YouTube? Of course not. That would be wasteful and not a good idea. And so looking at some of the audience options, we'll break down a few of these. So if you look kind of from top to bottom there, it starts with demographic targeting. So age, gender, you could throw in income potentially there too, but demo all the way down to the bottom, it's remarketing, right?

Brett:

So at the top, that's a really cold audience, at the bottom, it's a very hot audience. At the top, it's a broad audience, at the bottom's very focused. Top, it's a big audience and at the bottom it's more of a small audience. And so where do we start? Where do we begin? And kind of in the middle, you have things like life events, someone that just graduated college or just got married, some life there or some in-market audience as we'll talk about in just a minute.

Brett:

And so the cool thing is understanding these audiences will allow you to harness all the information Google has about users so you can reach the right person right when you want to. So recently we did a study showing the same video to an audience based on intent signals. And we'll talk about what that means in a minute, but based on intent signals. And here's the thing guys, Google knows everything about you, right? Google knows what you're up to online. They know where you've been online and what videos you've watched and what searches you conducted on Google and things like that. And so when they leverage some of those intent signals, consideration lift goes up 30% and purchase intent goes up 40%. So 30% to 40% more effective when you reach a very targeted intent-based audience versus just broadcasting your ad to the YouTube universe, right?

Brett:

So we want to harness those intent signals in our intent-based audiences. So we're going after intent-based audiences initially. Let's talk about a couple of my favorite. First one is custom intent. So how many of you would say the way you search on Google is different than the way you search on YouTube? So you search on Google differently, you search on... Yeah, YouTube, hey, sometimes you want to watch a music video, right? You just want to chill out and have some music on YouTube, whatever. But Google, you're searching for everything. Literally everything. Like how old is this movie star and who is in this? And all kinds of crazy stuff we're searching for on Google.

Brett:

So what a custom intent audience allows you to do is you can build an audience of people based on what they searched for on Google and then reach them the next time they're on YouTube, right? So again, we're looking at a travel company or something. We can look for all the people that have searched on Google recently for group travel or price to travel to Greece or guided tours of Rome or things like that, where we can compile this list of keywords that people search for on Google. Now we can reach those people on YouTube with our app. Does that make sense? See how powerful that is? You know what these people want because they're searching for it on a Google.

Brett:

Now the other thing you can do is keyword targeting in YouTube, right? So this is the other intent-based audience that we really like to focus on initially. So I started typing in YouTube, typed in best in OI and then just let the suggest fill that in, right? So this is what people are typing in on YouTube. "Best noise canceling headphones, 2019. Best noise canceling headphones, 2020," right? So people going to YouTube looking for product demos and unboxing videos and things like that related to the product they want to buy.

Brett:

And so you can also target these people, right? So they're in YouTube, actively consuming content related to these keywords, and you can run your ad right there. Okay? So someone's looking for best noise canceling headphones in 2020, they're watching noise canceling headphones videos, we now show our ad for our new brand of noise canceling headphones. Very, very powerful.

Brett:

So the idea here is we want to get conversions, right? So whether you're trying to get a lead or an opt-in or an actual purchase, a lot of our clients, they're running YouTube directly to an e-commerce sale. So watch a video by some skin cream, right? Watch a YouTube video, buy a silicone wedding ring, right? Watch a YouTube video by whatever. Or it could be that you want to direct them to just opt into something, get a deal, whatever. So you want to get conversions and then go broad. Then broaden out your horizon. So in-market audiences, this is where Google is saying, "Hey, based on someone's recent behavior, based on their two-week behavior, we think they're in the market for an automobile or financial services or lingerie or whatever."

Brett:

So it's based on searches they've made videos, they've watched even places they've visited, right? Because if you have location tracking on, on your phone, Google knows if you've been to a car dealership, right? And so in the market for auto or whatever the case may be, so these in-market audiences, these are larger, usually 25 million plus. So you can start targeting them as well. And then you can start looking even broader than that. So affinity, that's more interest-based, topic-based. So I'm into fitness or fitness apparel or yoga or I'm a foodie, something like that or just straight demographic targeting. So start with intent-based and then broaden your scope, broaden your reach to these larger audiences based on either customer-intent or based on in-market or affinity and demo, okay?

Brett:

All right. Key number three, power your ad with data. This is why, and I'm a marketing guy, old school, started in 2002, did TV, radio, did direct mail. I was a Jay Abraham student and Dan Kennedy and really like this direct response type advertising. And I loved it because I love the science of why does one ad work and another doesn't, right? Why does one TV commercial get someone to say, "Yes, I will buy that sweatshirt then the other causes people to shrug." Right?

Brett:

And so looking at what causes people to buy. In the old days though, it was all just a bunch of like theories and ideas and who was the loudest in the room and who could convince everybody else that their creative strategy was the one to adopt, right? But now we have data, we have science, we can see what's actually working and what's not. So here's how to... So start with one of these templates we talked about, but then let the data speak, let the data show you what's working and what's not. So here's how to do that.

Brett:

And then this is what's interesting, sometimes your assumptions are wrong, right? Sometimes my assumptions are wrong. I know YouTube pretty well. I'm in YouTube every day. We're spending millions and millions of dollars on YouTube ads, I still get it wrong. Sometimes ugly wins and sometimes uncreative, Just really simple, straightforward, direct, sometimes that is what produces on YouTube. So here's some of the things to measure.

Brett:

So this is BOOM by Cindy Joseph. This is Ezra Firestone's company. And actually, there's a BOOM shirt right there, Laura, checking out the session. So watch these videos, they're fantastic. This is skincare for older women, boomer women primarily. So these top two videos, the top one is four minutes and 39 seconds, the top one is two minutes and 40 seconds. Those are our top two ads. These are primarily looking at cold audiences.

Brett:

So this is more of a cold awareness type traffic. So those are the top ads both on the size of the reach, the number of conversions we were able to get from those videos, And more importantly, we hit the CPA target, the cost per acquisition target with those videos. Now we could have sat around and said, "Yeah, but that's four minutes and 39 seconds It needs to be like 15." Because I know if I'm watching a skincare commercial I won't watch past 20 seconds. Right? And all of that is a who cares? None of that matters. Your opinion, my opinion does not matter. Mismatch. So it's the data. And we've tested a lot of 15-second ads, We've tested the new six-second bumper ads at our Google reps requests. We have awesome Google reps, but they usually do not work on YouTube if you're trying to get conversions. If you're just try to get views, they work great, but if you're trying to drive a conversion, those short form videos do not work nearly as well.

Brett:

Another thing we do, we like to pull audience-specific data for each video. So I can actually give you the spreadsheet if you want to see, there's nothing magical about it. But basically you download this data from YouTube or from your Google ads campaigns or your YouTube campaigns, and then break down each video by audience. So here's a cold audience, here's a warm audience, how did this ad perform to these different audiences? And you'll see that for some videos it's very different, right? It's very different how they perform. Some of those five, six-minute videos perform really well for warm audiences, not as much the cold audiences. So you need this data so you can make better decisions.

Brett:

And then, this is I think one of the most untapped resources in a Google ads account and is very, very powerful. So this is audience insights. So if you go to the tools section in Google ads, click on audience manager, and then audience insights, what Google is going to do, this is really only valuable after you've been running for a while, after you get some data, after you have some clicks and some conversions, then that's when this data becomes powerful. Google is going to tell you, "Hey, based on what we know about your users, your visitors, your converters, they are more likely to be in these audiences." So they're more likely... In this case, they're 3.6 times more likely, this is a more of a men-focused brand. They're 3.6 times more likely to be a truck or SUV enthusiast than the average population."

Brett:

So now, based on what Google is giving you is, "Here's a list of audience ideas." So now you've got these audiences, your initial tests set of audiences. Once you start getting conversions, Google is going to say, "Hey, test these next." Sometimes we find really counterintuitive ones like supplements that we're selling, an avid news readers is the suggestion from audience insights or financial services when again is our supplement and usually it works. Usually Google is seeing something here and so you should test these audiences.

Brett:

Alright, this is a quick one but also a powerful one, so leverage the YouTube and Google Display Network or GDN synergy. Okay, so how can we leverage that synergy? So here's a shot back to BOOM, shot of some of their display ads. So these are showing on the Google Display Network, so showing on news sites, blog sites, things like that. There are 2 million sites, part of the Google display network. You can reach 90% of the web through the Google Display Network. But that ad on the left, that is actually just their YouTube ad that we placed into a display campaign, right?

Brett:

So what this looks like, this is kind of the responsive display ad builder or what one of the views in there looks like. You can add images, logo, add some text. So this is just showing over time, this was primarily to a remarketing audience, but over time the top performing Google Display Network asset was our YouTube video. So that YouTube video then was appearing on news sites, blogs sites, things like that, but this is something that a lot of people overlook, if I'm running display ads, it needs to be an image. It needs to be an image only. Not so fast, use your YouTube ad in your Google Display Network campaigns and you may be surprised, it may be the best performing ad. And so what Google then sees is, "Hey, people are engaging with that ad, it's working, we're going to keep showing this YouTube video on the Google display network."

Brett:

How many of you guys are running Gmail ads? Whoa, not very many people, like five or something. So Gmail campaigns, this is another amazing way to leverage both images and YouTube videos. But Gmail ads, they appear like emails in your Gmail app. Okay. So it kind of can look like this on mobile. That's an ad for BOOM by Cindy Joseph on the left and Live Bearded there on the right. It does say ad there, but it shows up in the inbox on the Gmail app and looks like an email, right? What we're seeing as we run this, and we're primarily running this for remarketing, right? So somebody gets to our lander, they don't convert, they add to cart, they don't convert. We're running Gmail ads to those people. And so what we're finding is CPA, so cost per acquisition or cost per conversion, often 30% to 60% lower for Gmail ads than for standard display.

Brett:

A lot of times we're using these same images, the same videos, but because of this delivery mechanism and people are engaging often 30% to 60% of lower CPAs, which is pretty powerful. And so this is kind of what the builder looks like, with the ad there on the right, that's what that could look like. This was again for BOOM. You get a series of images, text, videos, but this is an extremely powerful type of campaign. And so if you have remarketing list... How many of you guys have remarketing lists? Okay, go build a Google Gmail campaign, right? If you have a remarketing list and you have images and you have some videos, if you don't have videos, you can still run it, but Gmail campaign is simple to set up, do it for remarketing and do it sooner rather than later.

Brett:

So let's talk about a couple of things and then potentially a Q&A if we have time. So key number five, make better decisions with smarter measurements. We talked about data a minute ago, right? Using data to power your ad, but how are we analyzing that data and what are we looking at? Because it's so easy. I love Google Analytics, but it's so easy to get in there and get lost and then to maybe focus on a metric that's meaningless, right? All the while, the real data, the good data is right there staring at you saying, "Hey, do this, do this," but we're not seeing it. Right? So smarter measurement to get better results. Let's talk this through a little bit.

Brett:

Anybody here getting good ideas on airplanes? How many get good ideas in the shower? That's because .. For me, I don't know man. I'm just thinking about like soap and I don't know. I'm like brain dead in the shower. I don't know why, but put me in an airplane, shut the door, go into airplane mode and all these ideas come to me. So about a year ago thinking about how do we communicate this better, how do we set up a structure for our clients a little bit better. And so I came with idea of AMP or accelerated marketing portfolios. And so thinking about your campaigns, not as silos, your campaigns, not as individual warriors, but thinking about your campaigns as a portfolio working together synergistically, making things happen on your behalf. So what does this look like? Well, this was another realization that kind of fed into this.

Brett:

This is the screenshot of a branded search campaign for a large advertiser. They were spending boatloads of money on Facebook ads even before we started working with them. So this is going to look at the performance of their branded search campaigns. That arrow is when we started running YouTube ads and their branded search campaign took off, right? Which going back to the data we saw, hey, 80% of people that view YouTube video in their shopping journey, they do it at the beginning, right? So they saw stuff on YouTube and they actually bought by clicking on search ad, right?

Brett:

So looking at, hey, if we just looked at the YouTube ad campaign all by itself and we didn't look at this, we might shut YouTube off prematurely thinking, "YouTube is not doing anything," right? So we shut it off, but then that goes back down immediately. We've seen this happen with large advertisers, you shut off YouTube and the branded search goes down, right?

Brett:

So thinking about all of this together, so here's what we looked at, and again, we're primarily e-commerce, so we're primarily measuring return on ad spend, but let's just look at some hypotheticals. So we're running a YouTube campaign to an awareness audience. We might see something like a 50% to 200% return on ad spend. So I spend a dollar and from that campaign I get 50 cents as return. How many of you guys like that deal? Spend a dollar to get... No, no, no. I didn't explain that well. You spend a dollar and you get 50 cents, not $1.50 but you're getting 50 cents, right? You're losing money is what that looks like on the outset, right? So YouTube, looking at the campaign itself, you're getting a 50% return to maybe a 200% return at that awareness level. Okay?

Brett:

But then let's move a little bit further down. So consideration, that's more like Google Search, Google Shopping, that type of thing. Hey, maybe we're getting like a 300% to 400%. So now I'm spending a dollar and I'm getting three to four dollars in return. Okay? Then I look at branded search and remarketing, maybe at that point that I'm getting like a 4X to 8X return on ad spend. But here's the deal. Even if those YouTube campaigns are at a 0.5, right? A 50% return on ad spend, they could make all of the rest of it bigger and more valuable. They could feed those remarketing campaigns that are at 800% return on ad spend.

Brett:

And so we're saying is a lot of our clients at the portfolio level want to be at a 2X to 3X. We can show you and we built a spreadsheet and this is something I can show you. It's a one on one on one, it's kind of confusing if you don't have a little bit of explanation, we can map out, if we were to spend X on YouTube and get even a 0.5 return, it's going to feed the rest of it and overall you're going to hit your global numbers and the overall pie is going to be much bigger. Does that make sense?

Brett:

So smarter approach, smarter measurement, don't just see campaigns as individuals. I know a lot of you have to show this to your boss and your teams and you have to convince them of this stuff. It's not super easy but we've got some tools I'm happy to share to make this a little bit easier. And so just a couple of very quick examples I'll just take about 20 seconds. BOOM, and this a quote from Ezra, we took YouTube from nonexistent to one of their top channels in a pretty short period of time. Grew their Google ads revenue by about 200%. Overall sales grew about 30%. Live Bearded, I mainly show these guys because they looks so cool and I secretly want to be like them, but grew their conversion 65% largely using YouTube. So with that, my man, do we have time for questions? Okay.

Speaker 1:

We have one or two questions.

Brett:

One or two questions. What do you got? Anything YouTube related? Yes sir. loud so-

Speaker 1:

Speak into the mic.

Brett:

... speak into the mike anyway.

Stevenson:

Okay. So Stevenson, strategist at 72andSunny and we have a wide range of clients. So some of them are dropping millions on YouTube, others are not as convinced. You talked a little about keyword targeting. How do you know when to lead into those broad searches? So someone types in, let's say leading and writes the active vision as an example. Someone is looking at when is the newest call of duty coming out versus getting a lot more niche for those brands that aren't willing to spend that much more money. How do you figure out that balance?

Brett:

Yes. Great question. So if you're talking about keyword targeting and are you talking about a keyword campaign in YouTube or are you talking about like custom intent audience.

Brett:

On YouTube. So keyword campaign on YouTube. So what we've found is that usually keyword campaigns don't explode in volume. So to give you an idea, sometimes we'll run these affinity audiences or really large audiences and whatever budget you give that campaign, it will spend all of that and then some, right? Because these audiences are massive. Keyword campaigns don't tend to do the same thing. Occasionally, but usually not. So we've actually found more success with slightly broader keywords per keyword campaigns. So if you were talking about like a video game type deal or whatever. So people looking at video game reviews, we've even target just the name of that particular video game. So what we found and also keyword targeting on YouTube, this will get a little bit technical, it's not actually based on the keywords someone's typing in. It's based on the content. So where custom intent, that's actually based on the keyword someone types in on Google. A keyword campaign on YouTube is actually contextual.

Brett:

So that's where we found like broader keywords do better. But just watch it. And then also, one thing I didn't mention, but we always like to bid with target CPA. So, set up a conversion action with us, an opt-in or a purchase, and then give Google a target to hit, those campaigns always work better. Whatever goal you give YouTube, if the goal is views, they'll find views. If the goal is conversions, they'll find conversion. So give them that right goal to key in on. We have one more question, maybe?

Speaker 1:

What I can do and ask ladies and gentlemen first of all, if you loved this session, can you give a round of applause to Brett Curry.

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Episode 120

:

Michelle Barnum Smith

Using Chat Marketing to Scale Your Amazon Business

I had a chance to sit down with her and discuss some super powerful ways to grow your Amazon business with chat marketing that you probably.

‍

I’m sure you’re aware of chat marketing. But if you’re like most marketers and Amazon sellers, it’s still an area of immense opportunity for you. Maybe it’s even still a bit of a mystery to you. Michelle Barnum Smith is the Queen of chat marketing for Amazon sellers. I had a chance to sit down with her and discuss some super powerful ways to grow your Amazon business with chat marketing that you probably haven’t thought of, including…

The 3 types of messenger campaigns to run consistently
Why product re-ranking campaigns using chatbots should probably be an ongoing strategy for you
The difference between a 2-step URL and a Search, Find, Buy campaign
How many times per month should you message your list on messenger…too many and they’ll hate you. Too few and they’ll forget who you are and be annoyed the next time you message them.
How to build a chat bot list.
Plus more!

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Mentioned in this episode:

Traffic & Conversion Summit

ManyChat

Pixelfy.me

Helium 10

‍

Connect with Guest:

Michelle Barnum Smith - Amazon Chat Bot Expert

Episode Transcript

Brett:

Well, hello, and welcome to another edition of the e-Commerce Evolution Podcast. I'm your host, Brett Curry, CEO of OMG Commerce. And today, we're talking about a very timely and important topic, and a topic that I have not really dug into in this capacity before. So, we're going to be talking about chat marketing for Amazon, and I think it's totally appropriate. But if we're going to talk about this subject, we should have the queen of this subject on the podcast.

Brett:

So my guest today is Michelle Barnum Smith. She's been known as and referred to as the queen of Amazon chat marketing. We connected because we were both going to be speakers at TNC this year, which got postponed. So we will still be speakers at TNC, but not for a few months. But Michelle, thank you for taking the time. Thanks for coming on, and I'm really excited to dive into this topic.

Michelle Barnum Smith:

Thanks so much for having me. I'm excited to share with you guys some super timely information that changes, really, it's on the fly at this point.

Brett:

Yeah, it totally is. A lot of people that listen to ... We have two divisions to OMG, the Google ads ecosystem, and then the Amazon ads ecosystems. We spend a lot of time with Amazon. And at the time of this recording, we're recording this on Friday, April 17th. Amazon just announced that they are taking more non-essentials into the warehouses, ship time is going to be improving as of right now. Who knows what tomorrow will bring? Or by the time you listen to this, who knows what's going on? But Hey, the key right now is you got to stay fluid, man. You got to be ready to adapt and adjust. So, we'll talk about the current situation and what nuances or changes or considerations we should make. I do want to know, and then this is always fun for me to learn. But also for the audience to learn, how did you get here? How did you become the queen of Amazon chat marketing? So to give us the 90-second version there.

Michelle Barnum Smith:

Yeah, absolutely. So I started my marketing career 20 years ago in corporate high tech marketing and worked with many of the Fortune 100 and some of the largest businesses in the world. But their marketing, and then many people in the corporate space decided that I wanted more life flexibility. And so, I started my own marketing agency in 2012, and spent a lot of time doing digital funnels, and things like that. And then it-

Brett:

Good stuff.

Michelle Barnum Smith:

Right. And then in early 2017, I saw my first chat bot via mini chat. And I just knew that it was going to be the future. I just ... it was so sexy, so seamless, quick to set up, quick to optimize. And having lived in the digital funnel world where you're building massive email campaigns and massive funnels, and having a long time to launch, and a long optimization is just over the top difficult. Just the lightweightness of chatbots was just let me know that it was going to be the future. And so, I jumped on it and learned as much as I could, as quickly as I could, and started offering those services to my clients. And then in late 2017, got my first Amazon seller who was interested in using chatbots for product launches, ranking, that sort of thing. And I very quickly learned what Amazon sellers care about, what they need from an external traffic campaign. And then they just ... All of the gurus, all the peoples who are testing these new techniques out just passed me around all of their buddies. And I very quickly became known as the expert in the space, and started getting invited to see-

Brett:

Not just expert Michelle, you are royalty. You are the queen.

Michelle Barnum Smith:

A lot of my sellers were from great Britain. At that point, I was very honored, was such a title.

Brett:

I love it. That's fantastic.

Michelle Barnum Smith:

They're like, "I heard you're the queen." And I'm like, "Okay, that works for me."

Brett:

Sure, I won't deny it.

Michelle Barnum Smith:

Exactly. So it's just evolved, and it's crazy to think that something that happened in 2017, and here we are three years later. But that's the nature of the industry, is that it changes so quickly and so much. And it's important to listen to people who have been in it, and know what's going on, and not somebody who started five minutes ago.

Brett:

I love it. I think I love that you've been in marketing, some complex technical marketing, and then building funnels, which, lots of moving parts and lots of things to optimize. And it does seem like when we're in this space or I guess any space, what you're doing prepares you for what's next. Right?

Michelle Barnum Smith:

Absolutely.

Brett:

And so, it happened for us as. Well, I was doing all kinds of Google or all kinds of e-commerce stuff, pre-Google shopping, and then Google shopping. And I was like, "Oh, this is going to be it." And then when TrueView fraction came to YouTube, I was like, "Oh, this is going to be it." And so sounds like you had a similar experience with chat marketing, which is awesome. So let's dive in. I love the Amazon space, such a great platform to build a business. It is still extremely frustrating, and extremely volatile, and all kinds of landmines, and things to consider but-

Michelle Barnum Smith:

It could be stressful a lot.

Brett:

Yeah, not kidding. What's that?

Michelle Barnum Smith:

It caused me stress.

Brett:

Oh my gosh, it is for sure. So, we work with a lot of Amazon sellers, a lot of really large Amazon sellers. I don't know that many that are capitalizing on chat marketing to grow their Amazon business. So talk us through what are the most common use cases? How could insure it an Amazon seller utilize chat marketing?

Michelle Barnum Smith:

Whether you're a small business, where you have less than five listings, or you're a massive seller, or you have multiple brands and lots of listings, there's definitely a place for top marketing in your execution for new product launches, for rearranging campaigns. And especially right now with re-ranking campaigns, there are very few sellers who have not been drastically affected by the COVID pandemic and Amazon's ... And the repercussions that happened with shipping, and just traffic in general, massive swings in traffic in search terms and we can get into that in a second. But the main execution points for chat marketing as it relates to Amazon sellers, the four core areas, there's just general brand building and having an audience that's interested in and excited about what you have to offer. And that's true of any brand having a Facebook page, having an Instagram following. Now having a Messenger subscriber base is the extension of that brand presence. And by having that, that then lends itself and extends itself to being able to launch, rank, increase reviews, those kinds of things. And the techniques that I like and recommend are all within mostly the whiter area of terms of service, and the gray area in terms of sales. But honestly, those are the core four things that as far as Amazon sellers are concerned, are the main things to focus on the chat marketing.

Brett:

Got you. So, product launches, re-ranking products-

Michelle Barnum Smith:

Brand building.

Brett:

I'm assuming ... Are we also using it for getting reviews and handling customer support and things like that?

Michelle Barnum Smith:

Yeah. Absolutely. In fact, a study came out from Facebook right before Christmas time. And the holiday push that goes on with Facebook ads. And they released basically 95% of consumers prefer to interact with brands via chat.

Brett:

Interesting.

Michelle Barnum Smith:

So it's such a powerful platform to be able to connect and communicate with your customers.

Brett:

That's crazy. And what's interesting about that is, it seems like when I saw stats related to that years ago, it was different when you looked at a certain age. Age ranges, right? So, older customers would favor the phone or something or talking to a real person. But if the numbers are 95%, that means almost everybody. So maybe it's still is the-

Michelle Barnum Smith:

Older people prefer-

Brett:

70 plus crowd.

Michelle Barnum Smith:

Right.

Brett:

Well, even younger boomers got to be preferring chat for the numbers to be 95. So that's super interesting. One of the questions I have, and I'm assuming a lot of Amazon sellers have as well, how do we build this list? So you have to have a list of people on Facebook Messenger to be able to market and communicate with. How do you build the list?

Michelle Barnum Smith:

So it's very similar to email marketing in that regard. And the cool thing about Messenger based marketing is that it's a Facebook platform. And Facebook wants to monetize your subscriber base, your Messenger base. So they make it really easy to build a Messenger audience. Now, I like to combine a ranking campaign or product launch with a list building activity. I don't necessarily think that you need to build that list first, and then use them eventually. In fact, I think that's backwards. Because these people will forget about you in a second. Right? And so it's really crucial to make sure whatever campaign that you're running is very timely to your audience. IE don't build an audience and then come back to them in six months and expect them to remember who you are and care about what you have to offer because it's-

Brett:

You almost can't do that anyway.

Michelle Barnum Smith:

Right.

Brett:

Doesn't Facebook require you've got to respond within 24 hours or something? Or you can-

Michelle Barnum Smith:

There's certainly rules. Essentially, it's a pay to play scenario, right? Like, "Yeah, you can send promotional content outside a 24 hour interaction window, but you're going to pay for it." Right. That's the Facebook way really. Because, they get you hooked. I call them drug dealers. They get you hooked on cool technology for free, and then they start ... once they got you hooked, then they start charging you for it.

Brett:

That is not an unfair analogy for sure. Let's talk about that. Well, let's dive into a ranking campaign. So I've got this product that I'm selling on Amazon. Was just on a call with our Google reps, we were talking about ... And one of my reps is a big basketball fan. We're talking about the indoor basketball hoops. So maybe we can use that. Maybe use that as a fun example. So you get the little ... and everybody's stuck in at home, it's a little indoor ... the Pop-A-Shot, and other brands. So we're launching a new version of that. How do we utilize Messenger to rank?

Michelle Barnum Smith:

Well, let's back up a step. And I think the most important place to start is with your keyword research. And making sure especially in these inventory sensitive times. And it's not just about having inventory and FBA, is about having inventory in your supply chain.

Brett:

Yeah. What is this supply chain look like?

Michelle Barnum Smith:

I knew we're shut down for two-

Brett:

How many weeks or months of inventory you have and-

Michelle Barnum Smith:

Right. Exactly. And making sure ... I like to use Helium 10 to do my keyword research, but I'll hop on there and analyze what my competitor's keywords are, and then take a look at making sure that I have the inventory levels where it makes sense. I don't like to give them ... I don't like to what we call giveaways. But basically, you're going to be running campaigns, giving away your product for free pretty much. So if anybody's new to that term, and what I don't like to do, I don't like to give away more than a quarter of my inventory to rank for a target keyword. So that is a really important place to start. Because chat marketing, these marketing tools, they're just tools. You have to have the right strategy first. Otherwise, it's garbage in garbage out. Right? So spend your time doing the appropriate keyword research with your inventory in mind. And then what you're going to do is, you're going to decide the best type of campaign that you want to use. Whether you're going to offer coupon codes or rebates. Right now, he can't generate coupon codes at all on Amazon, maybe at a future date they will reopen that. But as of April 17th, you cannot generate coupon codes for Amazon listings.

Brett:

And then, there's no indication of when that might change.

Michelle Barnum Smith:

You know Amazon, they give us dates, and then they don't hold to it. Right? April 5th, we're supposed to be able to get inventory back in. That didn't win.

Brett:

Yeah. Need to know information. And we decide when you need to know.

Michelle Barnum Smith:

Right. Exactly. And then it's like, it leaks out slowly. Then people like, "Hey, I think you're able to do this now." So anyway, rebates are the way to go, especially right now. Why we love rebates is that they're full-price purchase. Whether you're offering 100% off or 50% off, that's up to you to decide as far as the rebate goes itself. But lead with a rebate counts a full-price purchase, which then translates into the ability to follow up and request a review from a verified purchase essentially. So you're going to determine your campaign strategy. Maybe you're running the rebate with a certain percentage off and then ... And you can also experiment with other offers like BOGOs or things like that. But typically, if you're just getting started, I'd probably start with a rebate campaign. And then, you're going to set up if you don't have an existing audience to put an offer out to an email list or something else like that because you can definitely build-out. Well the tool that I like to use for my chatbots and my chat marketing is ManyChat and that's spelled M-A-N-Y-C-H-A-T many chats. And-

Brett:

They're really the leader in the space. Right?

Michelle Barnum Smith:

Yeah, they are.

Brett:

I mean, all my friends, Ezra, Molly, they're all using ManyChats.

Michelle Barnum Smith:

Oh yeah. When chat marketing first started, there were a few players. And then very quickly, ManyChat was knighted. We continue with the queen and the knights.

Brett:

That's how I like that.

Michelle Barnum Smith:

No, but they very much have risen to the top. And especially with the changes that Messenger's made in the last few months, they have pivoted and adapted to make their platform even more valuable to their users. So I definitely recommend ManyChat and I have a coupon code that we'll put ... give you guys in the show notes.

Brett:

Yeah. We'll link to in the show notes. Absolutely.

Michelle Barnum Smith:

Yeah. We'll give you ... I have a coupon code with ManyChat where you can get a free month of ManyChat Pro. So it's really great that they're offering that. Anyway, once you build out your flow, your ManyChat flow, then you can have different growth tools connecting to it like an emailing that you can send out to your email subscribers. Or you can set up tools to connect now with a Facebook Messenger campaign, or a Facebook campaign. And typically, what those ads look like, it's like ads in your newsfeed, or your stories feed or whatever. And it has an offer like, get this great deal now for 100% off rebate. That thing, swipe up or click here to get your deal in Messenger. And Messenger will literally pop open. And it's this fun, interactive, intriguing experience for a lot of people. And you go from there. I mean, it's better ... it's easier to demonstrate than it is to talk about.

Brett:

Sure. We can all visualize. I mean, we've all seen and interacted with Facebook and Instagram ads and even story ads probably. And so, essentially, you're setting it up, you're setting your targeting. Now you talked about keyword research. So the keyword research, that doesn't impact anything you're doing on Facebook. That's just that you're using that to determine what keywords you want to rank for?

Michelle Barnum Smith:

Right. Exactly.

Brett:

Let's talk about how you're utilizing those.

Michelle Barnum Smith:

You build that into your flow, and there's two different fashions. When it comes to Amazon, these Amazon ranking campaigns, you have the offer, and then you have the call to action. And the offer is where you're deciding, is it a coupon? Is it a rebate? Is it a BOGO? Is it ... What is this creative offer? And then a call to action is how you're going to get the user to take advantage of that offer. And you have ... It really comes down to two things there, what we call two-step URLs. And then, there's search, find, and buy campaigns. And two-step URLs are really great because they take you directly to the listing and embed the keyword into the URL itself. And I recommended a tool called pixelfi.me. We'll put a link in the show notes.

Brett:

Absolutely.

Michelle Barnum Smith:

And what they do, why I love their tool is because they turn all those links into what we call deep links. And deep links ... The majority of your people, the people who are going to interact with your ad, you do so on their mobile device. Especially if it's Instagram, for example. But just assume that 70 to 80% of your users are going to be interacting with the ad on their mobile device. And so, what happens is when you click on a two-step URL, that's not a deep link is, that it'll open a browser window and in Amazon, in your Messenger app basically. And so, somebody will go, and they'll add it to cart, and do all those things, and go to checkout. And then, they have to log into their Amazon account. It's just so painful. I don't remember my login, and who wants to have to track down the log-in information? It creates friction, face this stuff.

Brett:

Yup. And anytime you create friction, people are going to bail. People are just going to get frustrated and bounce.

Michelle Barnum Smith:

Right. Exactly. And so, we want to increase that conversion. And deep links, if somebody has the Amazon mobile device on their Amazon app, on their mobile device, instead of opening your browser window when you clicked on a link, it'll open the app, and thus, you're probably already logged in. And Amazon pretty much is on everybody's phones and mobile devices these days. As they release numbers, they increased their revenues by like 35% in the last six weeks. Like-

Brett:

And if you think about that without ... It's hard to buy stuff that are not essential. If we have a client in the fitness space, I know fitness space, which is huge right now. And some of those Amazon's not delivering for like four or five weeks. So they're even losing some sales and some categories, and they're still up 35%.

Michelle Barnum Smith:

Yeah. It's crazy. So deep links are definitely the way to go for your two-step URLs. Now that's one call to action. The other call to action or search, find and buy campaigns ... Now search, find and buy campaigns are the preferred method most people want because it mimics the organic user experience. You go to amazon.com, you type in the keyword, and then you literally search, find, and buy product.

Brett:

So you're just giving the customer the instructions to go do this.

Michelle Barnum Smith:

Correct. Now, one of the problems with search, find, buy is especially on your mobile device, if you're not within two mobile search result pages of your target keyword, people are going to have search fatigue. They're going to ... everything starts blending together. They're going to forget what your product looks like. They're going to forget why they're there, and they're going to go buy toilet paper instead of whatever it is that ... The completion rate was, they're trying to buy is different, is definitely lower than a two-step URL. And what I definitely recommend is that for new product launches where you're in no man's land after being indexed, if you're not within two mobile search result pages of your target keyword, then you use a two-step URL until you are within that striking distance. And then you can switch to search, find, buy campaign if you want to. There's conspiracy theorists out there as far as Amazon is concerned, and there's lots of them.

Brett:

Really? Conspiracy theorists in Amazon? Then they're everywhere.

Michelle Barnum Smith:

Right. Totally. But a lot of people don't like URLs because they're worried that Amazon can track where you're people are coming from. And for me, the reality is I don't see it affecting ranking. And so I'm going to keep using it until I do.

Brett:

Yeah. Those things are still good for Amazon. Right? It's a full purchase. If you get good reviews, it makes sense that it almost ... I don't know if this is a great analogy, but this almost seems like the difference between someone using GPS to get somewhere versus someone taking oral directions which it-

Michelle Barnum Smith:

Turn to Chevron-

Brett:

Yeah. Turn here. It's about three miles. You're going to go East or like ... mind blown. So that's what makes sense. So two-step URLs versus search, find, buy campaigns. Awesome. So we got that going. And any rules of thumb for how long you need to run these, like how many? I know you mentioned talking about a quarter of your inventory depending on what you have. That could be massive amounts, but how long do you need to do this to see meaningful changes in rank? I'm sure that there's a lot of factors that influence that answer.

Michelle Barnum Smith:

Yeah. So a couple of things, using Helium 10, they'll give you an 8 to 10-day guideline on how long to run. And usually, it's about that. It's a 10-day ranking. Even if you see your rank improve after day one, you don't shut off your campaign. You want that sustained velocity over that basically eight-day period. Now some of my sellers who sell in what I call bloodbath categories, couple meds, wireless accessories, those kinds of things you might need to run a full 30 day ranking campaign. You might have to have a constant ranking campaign running where you're just dripping in, and keeping-

Brett:

Keeping your sales velocity up to keep your rankings.

Michelle Barnum Smith:

Yeah. Even as you're getting all those organic cells supplement with your own external traffic as well, an important thing to note as it relates to ranking campaigns is that ... I use the analogy of teaching your kids how to ride a bike. Have you taught your kids how to ride a bike?

Brett:

We actually just did that with our five-year-old Sydney. She was our quickest learner. She she just caught it in no time, but it can be ... It is one of those non-intuitive things where you have to teach them. You need a little bit of speed. Without speed, you can't stay up right. So you got to get your momentum going. But yeah, that's a fun process.

Michelle Barnum Smith:

Right. Exactly. And I have two. I have daughters, four and six. And we're definitely ... The oldest one is good. The four-year-old we're on our way to ... because we haven't decided to bite that bullet yet. But basically, how training the kids to ride a bicycle goes as you hold, you provide them some external balance and velocity. And then you teach them to generate their own velocity to maintain their momentum. And if they don't maintain that momentum, we all know what happens. Right? Hash falls, heartbreaking his parents, frustrating for them, and they don't ever want to do it again. And the same thing is true for ranking campaigns, for Amazon sellers.

Michelle Barnum Smith:

And your listings is that external traffic is there to provide you that external velocity. But if your listing can not maintain that momentum on its own, IE we've given you the best position possible. Now, can you convert organic traffic on your own? And that goes to having a really great listing, having great product images, indexing for the right keywords, having good copy, maybe eight-plus content, as it makes sense for your ... having social proof. All of these things factor into conversion and organic conversion. And so, chatbots and chat marketing all about velocity, but your listing has to be positioned for conversion. The worst listings out there ... I've had people come to me and their listings are just total crap. And they're like, "I want you to rank this." And I'm like, "Absolutely not."

Brett:

Not going to work.

Michelle Barnum Smith:

That is not going to work. Well, I can rank you. But if people are going to be super sketched out by what you're offering, then it's not going to stick, and I don't want-

Brett:

Yeah. And you're going to have to spend a lot more. You're going to have to spend more to get people to buy. You have to keep that momentum going, that velocity from the campaigns wait for longer. Because the campaign's not self-sustaining or the listing's not self-sustaining. So yeah, totally makes sense. So then, what are you doing? This process makes sense to me. Are you then following up using a chat bot to get that good review, or to maybe mitigate bad reviews? How are you tying in the review piece to this?

Michelle Barnum Smith:

Yeah, absolutely. So the campaign itself is basically two pieces. The first half of the piece is promotional. And the second half of the piece is going to be ... or well, I guess three pieces. The first half will be the promotion and getting people the offer, getting people to take the offer. And then, if you're running a rebate, then delivering the rebate would be the second half, actually providing the rebate. And then, the third portion is the post-purchase followup and making sure ... checking on people's experience with product. And there's a number of ways to do this. But the main way that I recommend is to follow up 3 to 10 days, post-purchase. You're going to know better for your listing if ... for your product, if it's a three-day followup if it's a product that people can see immediately, if it's working for them or not, or if it's a supplement or skincare where it takes-

Brett:

I think it should be a little longer now, because some delivery times are extended potentially.

Michelle Barnum Smith:

Yeah, definitely. So once again, you got to take all these factors into advisement. And I don't re... I recommend waiting to distribute a rebate until the product is shipped. So not immediately after somebody has purchased, but make sure the product actually ships, so they don't have a chance to cancel their order. Avoid those kinds of fraud elements. But then the review itself is going to basically be after a significant delay and using ManyChat, you're going to be using some post-purchase update tags to make sure that your message actually goes out. That goes ... That's a little technical for this but just making sure that you have the right elements in place so that you can get that message automatically delivered, and then asking people about their experience, and requesting your reviews or providing customer service really is what it comes down to.

Brett:

Awesome. I love it. And you also talked about these re-ranking or relaunch events or whatever. I assume that's something that people are going to need to do now, because maybe you're losing the buy box. Maybe, because of shipping issues, or inventory issues, that your listing has been displaced in the rankings. I'm assuming it's the same process, but any notes or tips on how to run a re-ranking campaign, or when you need to do it, or just any insights there?

Michelle Barnum Smith:

I think it's actually really important. Re-ranking campaigns are actually what sellers need to be doing the majority of the time. Because this unlike ... especially if you're in a blood bath category, guaranteed, your competitors are constantly ranking re-ranking, that sort of thing. And I wouldn't fave these external traffic campaigns just for a new product launch. There's always a new keyword that you could be ranking for. But especially right now with the COVID craziness, we'll call it, all of that traffic haven't been diverted to keywords that ... The top 20 keywords in brand analytics are all COVID related. They're all like ... toilet paper was the top keyword for ever ... I haven't used it recently, but it's because all of that traffic has been diverted. What that's done is definitely affected ranking for listings. Typically had a lot of search volume, and thus had a lot of conversions and sales velocity. So I think especially as sellers are getting inventory back in, as shipping dates are no longer suppressed, that it's what I call a race to rank right now. Where you have a significant opportunity-

Brett:

A race to get back to normal life.

Michelle Barnum Smith:

Right. Exactly. And in some cases, your keyword, velocity keywords might be on sale for your category or for your listing because that traffic has been diverted elsewhere. Then what that can translate into is, taking advantage of lower search volumes for your typical keywords. So once again, go to your Helium 10 research and figure out where these are at for you. But re-ranking is-

Brett:

And as given, Helium 10, is that your keyword research tool of choice?

Michelle Barnum Smith:

Yeah, it really is. They make it so easy and I'm not ... I'm a marketing strategist. I'm not a developer. I'm not like some data scientist-

Brett:

Right.

Michelle Barnum Smith:

I'm like, "Just give it to me straight." And so, I love their tool. They just make it super easy.

Brett:

Interesting. Any other insights on just the way things have shifted in terms of search behavior, and interesting search terms, and stuff? I'm spending more of my day to day on the Google side of our business rather than the Amazon side. I know Amazon well, but we've seen some interesting things with Google search patterns as Amazon started to suppress, or start to delay deliveries of non-essentials. We started seeing in the Google search term report for our clients, people looking for two-day shipping, and next day shipping, it really spiked where it wasn't there as much before. And some other interesting things too, any other trends or interesting shifts you've seen on the keyword side other than shifts on things like toilet paper and stuff like that?

Michelle Barnum Smith:

I mean, that's the biggest thing and not ... obviously keyword volume going down in general. I will say it has rebounded steeply just in the last few days as shipping dates have no longer been suppressed. But stay at home orders are still being enforced here in the United States. People are comfort shopping.

Brett:

They are. Hey, retail therapy man, it is a real thing. And people want to buy, and so we need to be there to help them out.

Michelle Barnum Smith:

They're bored at home, stuck there. And they're just like ... There's a lot of dream shopping that's going on. There's lots of, when I get out of this house going on, there's lots of stretch pants being purchased, swimsuits, not so much.

Brett:

That's such a good point. What's also interesting is, we've seen this with our clients. And also just seeing studies when it comes to economic downturns or crisis or recession or whatever that people are more open to trying new brands. So we're brand loyalty may have ruled the day for some people in some categories. That's not as strong during uncertain times. So people are more willing to try something new. Especially, if you add value or give a compelling reason, or you have 100% rebate or something like that, people are open to trying new things. And so if you can, now it's such a great time to acquire new customers, build that list, build your ranking, all of those things.

Michelle Barnum Smith:

And something important to point out is because people are stuck at home, they're on social media, the social media usage rates are astronomical. And so, Facebook has dropped their ad costs. And they're the main ... I mean, besides TikTok, they're really-

Brett:

More inventory, right? More eyes, more time, just means more inventory.

Michelle Barnum Smith:

Exactly. And even if you are a bit afraid to run Facebook ads, or feel intimidated by them, gosh, now is the time to learn how to do them. Because ... and you don't even have to be crazy with a budget or anything like that. I ran a giveaway contest, a literal contest where ... and we were giving 5 cents to subscribers, and we got over 15,000 new subscribers in two weeks,

Brett:

Man, that's insane. Now is the time to be ... And that's what we've heard some people talking about is, Hey, even if our core product, our hero product, we've got some inventory issues, I still may be running some campaigns to build a list. To build either a remarketing list, or a viewed video list, or a Messenger list, because never been a cheaper time to build that list not in recent history. And now, we'll be able to capitalize on that when things do rebound. So once you build that list, what are some other tips or ideas or suggestions, how do we use our Messenger lists ongoing?

Michelle Barnum Smith:

So I think it's really important just like any marketing tool to have a communication plan and to have basically a communication schedule. And sometimes, Amazon sellers get a little myopic and think like, "Oh, I just need to focus on new product launches." I'm like, "No, there's ... mother's day is coming up. You need to run your ranking campaigns right now for your products and guaranteed almost any product out there can be spun in some way as gift for mom, whether it should be or not." But there's ranking campaigns going on, there's seasonal, there's other kinds of seasonal opportunities. So what I recommend is at the most three messages amongst your list, but at least one is to stay in contact-

Brett:

Because I'm assuming that it's similar to use emails where if you go too long without messaging someone, then when you do, they're like, "Who are you?"

Michelle Barnum Smith:

Right. Spam rate and subscribe rate, block rate, all of that goes up. And it's one of those things like I said that you constantly need to be re-ranking and constantly be adding external traffic and running those kinds of campaigns. They don't all have to be 100% off rebates, but you can run a 30% off coupon and still get the benefit of a verified purchase as it makes sense for your business. So what I recommend is having some ... as far as the marketing communications schedule going, have a ranking campaign, have a seasonal campaign, and then next thing, some other type of general offer going on just to keep people interested, and in tune with your brand. And this is also a really powerful time to migrate customers from Amazon to your own website, in buying directly from you and taking that relationship direct. I've been experimenting with a lot of subscribe and save campaigns. And if you're in the consumables space, there's a significant opportunity there to-

Brett:

Push for subscribe on your website. Or that's one of the questions I was wondering about because we do this a lot with Google remarketing for people that don't have a Shopify store or whatever. Is running re-order campaigns. So through remarketing, or through YouTube, or whatever. So is that something that you do through chat marketing as well, a re-order campaign?

Michelle Barnum Smith:

Yeah, absolutely. So, one of the strategies is to have a product insert in your Amazon products, and have a call to action. It takes them to many times, maybe like a QR code or a link or something like that to some really compelling offer versus the product insert needs to be seen. And then you need to have people convert. And so make sure it's something compelling. You don't want to do, like get a 5% off coupon. Now, offer them free product, offer them a BOGO, do something that's going to blow their minds and motivate them. And then once you get them into the flow, then you can of course ask for the review. But then maybe the call to action is some offer maybe back to Amazon. But right now we're experimenting with taking them to your website instead and it starts to develop a relationship directly with your brand.

Brett:

I love that. I love that plan. Awesome. Michelle, this has been fantastic. Maybe one more question that I want to find out; how people can get in touch with you and take advantage of any resources or training or tools that you have, things like that. But what are a couple of the mistakes that you see? What are the most prevalent mistakes where people hear this information? They think, "Oh, this is a great idea. I'm just going to go do it." But what are some of the prevalent mistakes that need to be avoided?

Michelle Barnum Smith:

I think one of the biggest mistakes is that people get into ManyChat, and they try to build these campaigns from scratch themselves. And ManyChat is built for business owners, not necessarily for developers. So it's definitely accessible, but me and my team, we build ManyChat templates that are a five-second install. And we build out all the bells and whistles. There's the things that you don't know, that you don't know, tags and what we call one time notification topics, and all of these things. And it's like, "You know what? just use our templates." We cut straight to the chase and make it really easy for you to be able to execute. The other thing is like I said, at the beginning, expecting chat, marketing to be this thanks all bandaid. Well guess what? If you don't have the right strategy you're putting into that tool, it's going to fail. The best temples out there, the best campaigns out there, start with strategy. And it's so crucial to really understand that first, and not be going after keywords you have no business going after really. So make sure that those are the two biggies that I see.

Brett:

Love it. Totally makes sense. And I think that applies to so many things, right? People are looking for the silver bullet or the one thing that's going to push them over the edge. And really, all of the tools we talk about on this podcast, they're made better when you have good product strategy. What's your reason for existing? How do you have a strong listing? All of those things work together. So awesome. How can people get a hold of these templates or learn more from you or hire you or whatever?

Michelle Barnum Smith:

Yeah, absolutely. I mean, I put together what I call the race to rank rebate template, and it's $9 and it is-

Brett:

$9? Really?

Michelle Barnum Smith:

Super easy to set up. We'll have the link for you in the show notes and give you everything that you need to be able to rank your campaigns with rebates. So that is the best place to get started. And then, if you need to get a hold of me, we'll also put that in the show notes on how best to reach out. Or if you are confused by me, just Google-

Brett:

Michelle Barnum Smith. Queen of ... What about queen of Amazon chat marketing? Does that return to you?

Michelle Barnum Smith:

I'm sure it's out there somewhere.

Brett:

You try it. Yeah, that is cool. Awesome. Well, this has been fantastic. I will link to everything in the show notes. You can go to e-commerceevolution.com, or now actually, the podcast is hosted @omgcommerce.com under resources and podcasts. You can get to it either way. But Michelle, this has been a blast. I love this topic. I think this is something that based on my experience anyway, a lot of people are missing, and people need to keep ... I think a lot of people probably heard of the rebate to rank, but this continual re-ranking, keeping the momentum, I don't think there's that many people thinking about it. So I really appreciate you sharing and thanks for coming on.

Michelle Barnum Smith:

Yeah, absolutely. Thanks so much for having me.

Brett:

Awesome. Absolutely. And as always, we appreciate you tuning in. Hey, we would love to have your review. So if you think this podcast is valuable, head over to iTunes, let us know what you think. As we get more reviews, more people can discover this podcast. So with that, until next time, thank you for listening.

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Episode 119

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Ezra Firestone - Smart Marketer

How eCommerce Legend Ezra Firestone and His Team are Surviving and THRIVING Right Now

Will your company be ready to thrive in the new normal?

Strengthening customer relationships. Building valuable assets. Improving and documenting SOPs. Growing email and remarketing lists. Watching every episode of the Michael Jordan/Chicago Bulls Documentary - The Last Dance. That’s just a few of the ways Ezra and Co are surviving and THRIVING in the current climate. Ezra is often the first person eCommerce entrepreneurs turn to when they need advice. This episode delivers some true and timely gems and words of wisdom. eCommerce will likely come out of this crisis stronger than ever. Will your company be ready to thrive in the new normal?

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Mentioned in this episode:

Michael Jordan Documentary - “The Last Dance”

Zipify Apps by Smart Marketer

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Ezra Firestone - Founder at Smart Marketer and Zipify Apps and Zipify Pages and CEO at BOOM! by Cindy Joseph

BOOM! by Cindy Joseph

Smart Marketer - eCommerce Courses by Ezra Firestone

Blue Ribbon Mastermind

Episode Transcript

Brett:

Hello and welcome to another edition of the eCommerce Evolution podcast. I'm your host, Brett Curry, CEO of OMG Commerce. And man, I have been looking forward to today's episode forever. And I will say, I've been trying to get this guest on this podcast for a long time. He is hard to track down. And it's hard to get on a schedule.

Brett:

This name really needs no introduction. My good friend Ezra Firestone is joining me today. If you don't know Ezra, if you've been living under a rock for the last five, six, seven years. Ezra is the co-founder and CEO of BOOM by Cindy Joseph, one of the premier online skincare brands. He's also the founder of Smart Marketer and the Blue Ribbon Mastermind, which by the way is I think, the premier mastermind or eCommerce companies. I say that all the time. I do not get paid to say that. And so-

Ezra:

They keep paying me to say that.

Brett:

Yeah. Thanks dude. Thanks for coming on, over the show.

Ezra:

Yeah. Happy to be here man. I always enjoy the opportunity to talk e-commerce with other e-comm nerds. And yeah, I'm not doing as many shows these days because my head is down running my companies. But I relish the opportunity and for all you listeners, you are my people. It's really fun to come together and look at how can we collectively support one another in doing a better job, running our business as being better people. Looking how we can cultivate excellence. I've been watching this Michael Jordan documentary.

Brett:

Dude. Oh, I didn't know you're a basketball guy.

Ezra:

Oh, I mean, listen, I grew up as a basketball player. I love basketball. You couldn't help but love being a kid in the early nineties.

Brett:

Absolutely.

Ezra:

And not love Michael Jordan

Brett:

Transform the game and transform sports in a lot of way.

Ezra:

Wasn't my team but just watching that guy, his strive for excellence is, I just, I was too young to appreciate what that was at that time. So, getting to revisit those memories now, has been really fun.

Brett:

That documentary is amazing. So, after watching the first two episodes on this past Sunday night, when it aired, I was like, "Man, I could watch another two or three episodes right now."

Ezra:

I know, right now. Yeah, I know. Well, they did it smart. Right? Two episodes a week for five weeks is really smart, because I'm going to be... I also binge watch both episodes all at once.

Brett:

Yeah. But there's something about it. And I appreciated Michael Jordan, his final season. That Last Dance season was my senior year in high school. So, I appreciated it but probably, not at the level that I do now. And it's six titles in eight years, that's just unheard of it. Anyway, he's the great man.

Ezra:

Listen, you didn't want to talk LeBron, you want to talk Kobe. He was like a cultural phenomenon in a way. And by the way, I'm never sure, if it's a cultural phenomenon or a cultural phenomena. One of those two. I don't know, the proper usage.

Brett:

Phenomenon would be singular. Right? I think that's phenomenon.

Ezra:

Cultural phenomenon in a way that these other athletes just weren't.

Brett:

Yeah. Yeah. Awesome. Good stuff man. So, what I want to do because we only have a short time together, and I want to make sure we maximize his time. I want to talk through, how you and your team are approaching the current economic climate. Which at the time of this recording and just to make this official, it is April 22nd, so we are still in the midst of lockdown across the US, and things are interesting. Things are very interesting in the eCommerce world. Some of us are way up. Some people are flat. Some people are down. So, it's a mixed bag but mostly up.

Brett:

So, I want to get an idea how you guys are handling the current situation. And also, how you're thinking about what the new normal of e-commerce is going to look like. And then, because you are the world famous Ezra Firestone, and I always learn a lot as we hang out and just chat. I won't even say, how you're doing, but what you're thinking about this time personally. And how you're deciding to thrive and things like that. But we'll start with the team aspect first. So, how are you and your team thinking about the current climate? How are you preparing for the new normal? And then, go into any detail there that seems interesting to you.

Ezra:

Well, it's evolved. I mean, the first thing that happened, was everybody freaked out, man, we are a month in. I'm a month in the quarantine. Maybe, a month and five days or something into self isolation, social distance, shelter in place. I'm in that. And my team is in that. You are probably in that now, at least a month, right?

Brett:

Yeah.

Ezra:

When it first started, everybody was scared. Nobody knew how long it was going to last. Didn't seem like it was going to be quite this long at the first start of it. And so, the first thing I had to do was reassure everybody, "Hey listen, you're not going to lose your job. We're going to keep moving forward. Luckily, we're in a situation where we can continue to operate. We were a virtual company, anyways. Let's quick improve our cash position by running a sale." We waited a week or so. We didn't mention Corona virus. We operated as per normal.

Ezra:

But we weren't sure at that time, if fulfillment centers were going to be considered essential business. So, we had a quick ran of sale that performed extremely well, improved our cash position a little bit. And then things started, even now, it was like, basically things started to hit the fan March 13th, for real, for real, from a business context. Then we were doing like a hundred grand a day from January 1st to March 13th. March 13th to March 25th that dropped $40,000 a day. Everything seized up and was tight. And then, all of a sudden it started to expand the opposite direction.

Ezra:

And I can give you a statistic here. I own and operate a company called Zipify Apps. And we have a checkout replacement for Shopify that operates across 4,000 stores. Let me give you this data. March 1st through 13th, the average amount of revenue that we processed through our application every day was 1.7 million. And we processed about 30,000 active orders a day.

Brett:

And across how many stores is that Ezra?

Ezra:

About 4,000 stores.

Brett:

4000 stores.

Ezra:

I got a good sample size, a bunch of different markets today. Yesterday we processed 3.6 million.

Brett:

Dude.

Ezra:

2 million more than our average. And it's just been going straight up like this. So, e-commerce is spiking. We saw that same thing with BOOM. Problem we ran into with BOOM was, we manufacturer in New York. I'm going to get to the team thing. Let me tell you a little about the history of what's happening with me and my business.

Brett:

Yeah, yeah. Right.

Ezra:

We manufacture in New York. New York is not a good place to be. I mean, hey, everywhere is struggling, but New York is really struggling with this.

Brett:

Absolutely, epicenter.

Ezra:

And it's also not a good place to manufacture, at this particular moment in time. And so, my manufacturers shut down. My core product that everybody comes to me for, I can't get any more of it. So, I had to quick dial down the scale on ads. I went from spending $20,000 a day on awareness level advertising, down to $2000. But things are working so well. And things are converting so well, that my revenue was not dialed down enough. As of tomorrow, no acquisition spend on Facebook at all. And I'm just going to, instead of acquiring new customers, I'm just going to use the inventory I have to support past customers, who know me, like me, trust me.

Ezra:

My email schedule, I use email three times a week. Content, keeping people engaged. I'm going to bring that down to one, because every email is making too much money. So, I have this problem where, for the first time ever in the history of my companies, that particular company, I need to sell less because I can't bet, I've two and a half months worth of inventory. To now, it's been a half a month. I can't bet that I'm going to be back online in two months. I mean, maybe we will, but if we're not, I'll be shut down. I have to furlough my employees. So, I'm dialing down to break even. So, I just operate at break even. I'm trying to. I'm not succeeding at that so far. So, that's happening with that business.

Ezra:

With the Zipify apps interestingly, which is a software as a service application for Shopify stores, up 20%. Because all these businesses are coming on to Shopify right now. And I am fortunate enough to have been working as an ambassador influencer, creating content, cultivating my presence in the Shopify space for the last decade. So now, when a bunch of people come in the door, they find me. So, I'm seeing a nice little spike there. Not to mention, the more money that comes through my checkout, the more money I make. Right? So, that's doing quite well. Interestingly, I'm at a 20% up and that company is very stable.

Ezra:

Smart Marketer is also very stable. Because Smart Marketer is an information publishing company, where we sell information on how to be an online business and succeed at an online business, and run ads, and do sales funnel optimization, all that kind of stuff. I'm not so much in the day to day of that. Molly Pittman is the CEO there, but that company is also doing well. So, I have two companies doing well out of this, always been all virtual. And one company that's in some serious trouble, which is my biggest company that me most of the money that I make, comes from that big company. The other ones do well and make a couple millions bucks a year. But in terms of what I actually live on, I usually parlay the money in those other companies right back in.

Brett:

Got it. Yeah. Yeah.

Ezra:

And so, that's like a picture of where I am.

Brett:

And I want to riff on that just a little bit, because we've seen some of the same things. Has been very interesting. Those first couple of weeks of quarantine, it was like everybody put on the brakes, consumers included. We did see some e-commerce was up at that time, because people weren't going to physical stores and they had to buy online. But then, was like something opened up in April. And then we saw another spike, and I'm not sure, if you saw this in your Zipify data, but last week, since last week, things have up. And I think, that's stimulus money, is our estimation. So, our Amazon clients and Google clients are all, of our clients are up right now.

Ezra:

4/16 was definitely the stimulus hit, the average in OneClickUpsell, sky rocketed by half a million. It has to be stimulus money.

Brett:

Has to be it.

Ezra:

But let me point out also, one of the big things is that Generation Y and the boomers... You're Gen X and Millennial, you're Gen X, right?

Brett:

I'm right on, so I'm born in '80. Most of the studies I see, say Gen X, I have seen a couple say, generally they are born.

Ezra:

Don't let anybody tell you otherwise, claim Gen X. It's more culturally popular than being a millennial.

Brett:

Exactly. We will go Gen X, thank you. Yeah.

Ezra:

Okay. So, Gen Y and the boomers, there's a huge swath of them that never shopped online, that are being forced to adopt this technology now. And that's one of the reasons why we're seeing e-commerce grow so rapidly, is because a huge percentage of the population that has money and spends money was not using e-commerce and now they are. That's clear.

Brett:

And I think, that baby is going to continue, right? So, they're forced adoption right now, because they can't get out. A lot of that behavior is going to continue, if they have a good experience.

Ezra:

Yes it will. And this will fast forward e-commerce growth in America, from 15% year over year to, it'll be 60% this year or something crazy. And then, it's just going to keep going. So, it's pretty cool. To talk about where I'm at with my team. First thing I did was like say, "Listen guys, we're fiscally responsible." We always have a year's worth of liquidity.

Brett:

Which is amazing, by the way.

Ezra:

"No matter what, I'm keeping you." So, I reassured them because they were all freaking out. Now look, if BOOM goes under and it can't sell product, there's a point at which I will not be able to cure pain for people. Right? I applied for the payroll loan, I didn't get it. The payroll loan thing dried up. Apparently now, it's been refilled as of today.

Brett:

I think you'll be good eventually. Yeah.

Ezra:

You got it. I didn't get it.

Brett:

Exactly.

Ezra:

Which is fine. Good for you. So, the next thing I did was say, "Hey, in this time of less promotion and more space in general. And we're not promoting. We're not launching products. We're not running ads as much. What can we do? There's a couple things we can do. We can create assets, right?" So, we started going heavy into, what can we create? We invested very heavily, even more heavily into our ambassador program to get more digital assets, so that when we are ready to promote, we have more tests

Brett:

Can you talk a little bit about your ambassador program. What is that? Because, you just doing an amazing job with it. And we benefit, running your YouTube ads. We've benefited from this ambassador program. But explain what is it?

Ezra:

So, a lot of people think of influencer marketing. I think influencer marketing is dumb. I mean, okay, dumb, that's an aggressive statement. But I think influencer marketing is a misguided approach in today's economy, because today's e-commerce economy is all about creative. It's about putting a message in front of someone that really resonates with them. Yeah, you got to do everything else right. Sales page optimization, upsell, average order value, all that content marketing. But the first thing you got to do is get an asset, a digital asset that is in front of a prospect that really resonates with them.

Ezra:

Well, influencer marketing, what you're doing is you're counting on a very small number of individuals, who have a following and you're trying to take advantage of their following. What we've done is, actually create influencers out of our customers. So, we have a brand ambassador program. I won't get too much into the actual technical specifics of how we operate it. But essentially, we incentivize our customers through giving them swag and we do one-to-one communication with them. We teach them how to do videos for us. We send them a selfie stick and a light. We send them a video. We send them all of our products. We give them examples of what we want. They do videos for us, talking about why they love our products, the benefit of owning our products, why they love our brand. And now we have-

Brett:

By the way, these videos are so good. As you watch them, the authenticity comes through. You can tell it's a real customer. Someone's not reading a script. It just, it resonates. And so, these make for great ads.

Ezra:

They speak to different segments of the population. Beth from Georgia, if Facebook knows to pump her in the Midwest. Kim from new York, is a little more hard edge, Facebook pumps around the East coast. So, you get all these different avatars. So, we are basically having our customers be our brand ambassadors. Incentivizing them and working with them one to one, to create videos that we then use images, all kinds of stuff, poems, articles, not just ads digital assets. So, we're investing a lot in that because we have some downtime. We're writing a lot of articles. We're going into optimizing all of our email flows. We're creating new parts of our blog. We're coming up with new ideas. From the creative standpoint, we're using this time to create more. That's one thing.

Ezra:

The other thing that we're doing, is we're using this time to assess all of our operations, do some spring cleaning, reorganize our Google drives, recreate our standard operating procedures, check all of our customer service macros. We call it spring cleaning. We're supposed to do it every year. We don't do it every year. But now, we're getting a kick in the butt to do that. And we are investing heavily in supply chain redundancy. I've got $40,000 in bets right now, out with five different labs trying to recreate the products that I have. Get a hand sanitizer because that will sell. We have a community of women who love us. If we had a natural organic sanitizer that would sell right now.

Ezra:

So, take a little bit of advantage of what people are wanting at this particular moment. It's harder to make a really wonderful hand sanitizer, than it is a face mask that will be a unique offering in the marketplace. For sure, you can get a lot of sanitizers, but it will sell. So, we've got a lot of bets placed on product creation and supply chain redundancy, which is something that is showed up as a whole in our strategy. It's like, "Dude, you sell $25 million a year, but you only got one person who makes your stuff, that wasn't so smart."

Brett:

You're counting on a pandemic, but anything can happen when you do have an answer.

Ezra:

Yeah. So, investing heavily in the creation of all variety of assets and optimization of the assets we have, mainly being our email flows. But creation of new assets, articles, blog posts, presale articles, ambassador videos, the whole nine.

Brett:

I love that. Again, I want to highlight that just really quickly, this idea of building assets, because we've done something very similar at OMG Commerce and it's already paying off. And I'm like, I don't know why it took a pandemic for us to do this, but make good use of this time. So, I was going to speak at five events, I know you were too, between now and the end of may. Those all got postponed, canceled, made virtual something. So, we've been doubling down on our content marketing, writing blog posts. I've been shooting videos. I recorded several videos. We've been doing our own advertisements. We never do our own advertising because we have tons of leads coming in. And so, looking at what kind of assets can you create as a team, that is so, so smart. Just wanted to.

Ezra:

Internet consumption is up 40%, so there's more people wanting more entertainment. So, if you can entertain your community, you can even... One of the things we do a lot is we curate from the internet. We pull funny videos, memes, articles, and we send out a newsletter saying, "Hey, here's all the best stuff from the internet this week." People love that kind of thing.

Brett:

That's great. I actually saw, I think, the internet usage is up 35, 40%. But I have some friends that run organic YouTube channels, and some of them their views are up 150% to 200%.

Ezra:

Wow.

Brett:

Just the thing.

Ezra:

Yeah. So, basically, operating as per normal with my team, securing them and having them all look at, "Hey, from your position, what do you think we could do better to serve our customers, create better products, do better marketing." So, really investing in creation. That's the strategy with the team. Whereas on the Zipify side, we're busier than ever in support. We don't have the same luxury. It's a whole different thing. It's just a whole different experience with Zipify, than it is with BOOM, because boom has space in a new way, and Zipify is crammed in a new way. So, it's an interesting balance.

Brett:

It's crazy. It's like sometimes, because e-commerce is good and it almost creates issues because it's so good. Like with supply chain-

Ezra:

Think about fulfillment, right? My fulfillment center is, they're like, "We just never expected this particular surge. And so, we got to shut down on Sundays to give our team a break." And they also have to, fulfillment centers, think about it, they're operating their essential business, but they have a new way of operating with social distancing rules.

Brett:

Right. Right. Cost of fulfillment is higher. Cost of sanitation is higher. All these things.

Ezra:

And they're like, "Hey, we're charging you an extra 50 bucks a week because we got to sanitize everything." So, they're a little slower. So, it's a wild time, man.

Brett:

Yeah. Yeah. But what's so interesting, I think that the perspective that you guys have and we have the same perspective is, we don't know what the new normal is going to look like. We don't know exactly. It seems at the time of this recording, some of the lockdowns will ease in the next two weeks to a month, whatever. Some things may get back to normal. I think, if you're focused on assets, taking care of customers, improving your processes, all that, you'll be able to make benefit when things turn or when you get more inventory. So, really positioning yourself to take advantage of.

Ezra:

And if you don't have inventory, build audiences, right? I'm going to ham don data on generating email.

Brett:

What was that again? Ham don...

Ezra:

Ham don data, man, I'm going hard in the paint, another way to say that.

Brett:

I love it.

Ezra:

I'm placing heavy bets on audience building, because traffic is cheaper than I've ever seen it.

Brett:

It is.

Ezra:

I am seeing $19 sales in the awareness pillar on Facebook for an $85 average order value. Have not seen that since 2015. We are seeing $29 sales on YouTube.

Brett:

On YouTube, yeah.

Ezra:

I have not seen that ever, for me in my accounts.

Brett:

It's always been $50 to $60. Sometimes $70. So, $29, blow your mind right now. I really wish we had more inventory right now.

Ezra:

I know, me too, man. I'm sorry. But you can build your audiences. You can put out content. Build audience of the people who view your videos. I put out two coronavirus videos. I spent 300 bucks on them or maybe a little bit more, but not much. 150,000 views a piece.

Brett:

Saw that. Yeah, those are great videos by the way.

Ezra:

It's like there's so much more visibility. So, I'm generating email leads and building audiences as well, very heavily. And you should be doing the same no matter what brand you're in.

Brett:

Yeah. Yeah. Totally agree. That's awesome. So, just looking at the personal side of things, because to be successful entrepreneurs and successful marketers, we can't totally separate the personal from the business, right?

Ezra:

Yeah.

Brett:

Any insights or thoughts on what you're doing to stay as positive as possible? And then, to try to have a healthy outlook both now, and then into the near term future.

Ezra:

I have a mantra that I have had since I was a little kid and it goes like this, face the inevitable with joy. Hey, this is inevitable. This is happening.

Brett:

You can't slow it down. You can't change it.

Ezra:

Yeah. But so, I might as well, face it with joy. I might as well, show up and do what I can do. And humans do not like surprise. We don't like change. Surprise is bad. Surprise is different than what we expected. And so, we go down and we're worried. Surprise is not a good thing. And this is a big surprise and it's freaking people out. And if you have any baseline fear, anxiety, this will bring it to the surface. Anything that's going on, any fear and anxiety that you might have in your body and mind about other things in life. Well, this is a big thing to be afraid of. A big uncertainty. A thing that's going to produce anxiety. What does the future look like? And so, there's temptation to operate from that heightened perspective. And I've been using this opportunity to take more joy from... I take for granted my daily life, man, my super nice, beautiful space in Upstate New York.

Brett:

Is amazing by the way.

Ezra:

Wonderful kitchen. All the fun little toys I have like skateboards. There's more joy and pleasure and gratitude to be taken and had from what I already have. It's a greater skill to have the ability to enjoy what you have than to have the ability to get what you want. So, I've been practicing gratitude. I've been practicing, feeling the feelings of fear and anxiety and worry when they come up. But not trying to stuff them down because that doesn't work. But feeling them and then, letting them go and trying to just...

Ezra:

And I've been using this as an opportunity to develop habits that I want to have when this is over. So, I've been going to sleep earlier, not being on my phone after 8:00 PM. Being asleep by 10:30, 11:00. Waking up at 7:00 AM. I'm always had a pretty good sleep wake cycle, but really being diligent about it. Meditating. Moving my body regularly. Doing a liver cleanse. It's basically, we don't have any fried food, no oils, no salts, no proteins for a week. Doing a little cleanse. Taking care of myself. And using this as an opportunity to develop some habits that I want to have when this is over, because I got time sitting at home. I got way more time than I normally... I'm not on the road. I'm not speaking at events. I just have space to cultivate some healthy habits that I want to have.

Ezra:

Some areas of my life that I normally ignore, I'm confronting and spending more time. Carrie and I spent a lot of time together. We're spending even more time together and looking at what we want to have happened in our life. And using this as a chance to reassess, "Are we ready to have kids?" It's reassessing our worldview. So, that's been cool. On the other side of it, I'm getting kicked out of my rental. I'm in a rental house. I'm building a house that's not ready. I got to move all my stuff. Well, that is very intense.

Brett:

When you had been kicked out of your house during a lockdown is not the easiest thing in the world, I'm sure.

Ezra:

And it's also like, okay, I have a lot of stuff.

Brett:

Yeah, dude. That house you're in right now, is not small. It's not a one person job to move that.

Ezra:

Yeah. So, that's a whole thing. And then, you can't really hire movers, so I'm dealing with that. But on the personal side of it, it's like, this is a very intense experience for worldwide, for everyone. And it's going to do me no good to be in a constant state of freak out. The first week I was glued to this. I was on TV every minute trying to find out what was going. I was just over consuming the pandemic content. I was able to, it was too much

Brett:

Nothing but anxiety. We do that.

Ezra:

Yeah. And it was like, "Okay. Well, this is not making me feel any better. And hey, what do I need to know?" Well, maybe once every day or two I need to know where are we with this thing. What are the doctors saying? What's going on in the world? I like Twitter for that. It's fun. It's nice to know where things are. And have a sense of, "Hey, is the curve flattening? What do people think is happening?"

Brett:

Right.

Ezra:

I'm doing that, but I'm no longer... By the way, I was eating a bag of chips every day when this first started. When this first started, all these things I'm telling you that I'm doing now, I was not doing.

Brett:

You were not doing. Yeah. Yeah. I think everybody had that. And I wanted just to underscore a couple of things, then I want to pivot back to specific business stuff. Maybe get into some Facebook ad tactics and strategies you're using right now, which should be fun. But I love this idea of getting into routine, taking care of your body, doing some things now that you didn't think you had the time to do before. We were just talking about the Last Dance documentary. And watching a little bit of Netflix.

Brett:

But we also, my wife and I decided, a couple of weeks we were, "Man, in the evenings we're watching maybe a little too much Netflix. Let's read. Let's talk." Rather than just, binge watching Netflix, which there's nothing wrong with that on occasion, but yet, do things, build habits, do things that you'll be proud of. And I think for some of us, we'll be able to look back at this time with at least some fondness, saying, "Hey, there was a crazy time, intense time, a hard time, but some really good things came out of it."

Ezra:

Yeah. Yeah. It takes a daily vigilance, right?

Brett:

It does.

Ezra:

You don't just do it one day and then it's over. Well, tomorrow you got to make the decision not to eat the whole bag of corn chips that you went ahead and bought 20 bags of, so they're all in your closet. I'm not saying I did that. But I got it. So, I close my closet. My brother came, I gave you six bags of chips.

Brett:

Great guest, and that cuts down on the chance that you'll dig into all of those. Yeah. Very good. Well, so let's talk a little bit about, what are you doing specifically, with Facebook. I know you're about to cut down topline cold traffic spend. But any specific new things you're doing right now, or things you recommend people do, other than build audiences and some of things we just talked about?

Ezra:

Yeah. I mean, I'm doing my best to spend as little as I possibly can. But there's always fun stuff you can be doing, right? You can go to Klaviyo, and you can create an audience of someone who bought once. And then, had one visit to the site and also a purchase. And then, you can do a look alike based on that. That's an impulse buyer. That's someone who came to the site one time, bought. That's a little segment of the population. Who you can then say, "Hey, Facebook, find more people who look like that." You can be doing fun stuff with audiences. My experience has been that, the name of the game on Facebook right now, and Instagram is creative. And in particular, video creative. And in particular multiple, like a longer form one, maybe a three to four to five minute one. A 15 second one for stories.

Ezra:

But iteration and diversity of creative is what is winning in the Facebook, Instagram marketplace because they're pretty good at figuring out who's going to buy, following the scent. And if you supply the algorithm with a bunch of different pieces of creative that it can try to put out there, you have a much better shot. And so, this ambassador program is the first time we've had an evergreen source of creative, because we'd always have to go do photo shoots or video shoots or interviews. And we never just had this evergreen consistent video coming in. Every week, three more people, "Oh my goodness." There's three minutes, that's a gold in that one.

Ezra:

So, this has been a real gift to us this year to have this supply of evergreen creative and not just continually be cutting up. You see our videos, you know we've been using those same set of assets, because they work. We cut them in different ways. But now, we have a new fresh supply. Unfortunately, we can't use it. So, I'm not doing anything super special other than what I always talk to you about, other than this fresh supply of creative and at the particular moment, I got it all dialed back.

Brett:

Yeah. Got it. So, one thing I will mention and this just came out, I'm not even sure, if you've seen this yet or not, Ezra, but Google made an announcement that they're going to make Google Shopping free for some people.

Ezra:

Okay. So, quick note for those who are listening at, and I'm going to say... Where is it at here? Eight hours ago, exactly, inside Blue Ribbon Mastermind, not responded to, by the way podcast listeners, not responded to. I say, "Hey, Brett Curry, does this mean that all product listings are now going to be free or that-"

Brett:

Oh, no. I didn't get a notification. I didn't see that email.

Ezra:

"... other non-paid merchants can list. But you can still buy product listing ads like we do, but get prominent placement. So, which is it?" You got to go in and respond to that.

Brett:

I'm going to respond it.

Ezra:

Does that mean that nobody pays? Or does that mean, we still get prominent by paying, but then other people are in there for free, how is that?

Brett:

Yeah. That's a great question. So, I will say now, you mentioned this before, using Facebook less. We were starting a contest with my wife and with my three big kids, that whoever picks up their phone the most or uses the most screen time has to buy a meal for everybody else. And so I looked, I was like, "Facebook is the thing I'm on the most." So, I haven't been on Facebook hardly at all today. And so, that's why. But I will respond to that. So, here's the scoop on Google Shopping. So, when you go to the main Google page and you search for skin cream, the main results on the Google search engine results page, those are still paid. So, when you see those Google Shopping ads on google.com, those are paid. If you click through to the Google Shopping tab, the top results there, also paid.

Brett:

But as you scroll down, some of those listings below that, could be free. So, if you advertise already on Google Shopping, like BOOM does, like all of our clients do, and you have a merchant center product feed, you'll qualify for those free clicks. So, your products are now eligible to be in those free placements, those free listings. So, really you don't need to do anything. We're just talking to our rep today. Early estimates are, if you're a current advertiser, you'll get 3% to 5% more clicks, free clicks. So, it's not going to be a game changer for anybody that's already on the platform. But it'll be nice. It'll be a nice free addition. You'll be able to see in merchant center free clicks versus paid clicks and how they perform. So, we haven't seen any of that data yet. We'll see it soon. I'll update people. Update Blue Ribbon with what that looks like.

Brett:

Now, if you're on Google Shopping, you can go through the same process just like you would, if you were going to pay for ads. So, you build a product feed, get a merchant center account, upload that feed. But then your products are eligible to show in those free placements. Also, you're looking Google Shopping on your phone, same thing. Some of the lower placements will be free. So yeah, advertisers, you still have a big advantage. Not everything is free. You can't just go free and hope to maintain a similar volume.

Ezra:

Still pretty sweet though.

Brett:

Still pretty sweet. Yeah. Yeah. So, take advantage of it. This is a great time to make sure, we're just reviewing all feeds, yours included. Looking at, "Hey, do we have the best, you were at optimized titles, should we test some new titles? Let's look at our descriptions. Let's look at our product type. Let's make sure that we're keyword rich, not keyword stuffing, but keyword rich." And that's going to impact those free listings as well. I know it's super powerful. Yeah, man. So, any other thoughts? And you have the distinct privilege of hanging out with really some of the best, brightest eCommerce store owners. Some of the coolest as well. You've done a great job of pulling together as a community of really cool people that are fun to hang out with and really smart. Any thoughts on what e-commerce looks like, this summer, or this fall, or anything on that?

Ezra:

So, it's a great, great time to be in the eCommerce sector. And, hey, this is a darkness but there will be a dawn. There's a light at the end of this tunnel. And that even, if you're out of product, or even if your supplier shut down, or even if you're having manufacturing issues, do whatever you can to stay steady. Because the skillset that you have of understanding how to be an eCommerce merchant is so valuable. A lot of people want to know, what you know. All the bricks and mortar businesses, we're currently out of the ads auctions. All the local businesses, they all want to know how to do this. And so, the eCommerce is going to be the new normal.

Ezra:

We're not going back to a bricks and mortar society. I mean, first of all the malls were dying anyways. All the big retailers, many of them were going bankrupt. It was happening slowly. It was a generation away. This just hyper speeded it.

Brett:

And even when some things open up, there will still be a lot of people that are going to say, "Man, I'm not going to chance it. Well, if there's anything I can buy online, I'll do it."

Ezra:

For sure. And they're all going to open up probably with social distancing rules. And who really knows, I mean, who knows? Maybe it'll just go away in the summer and not come back. That'd be cool. I'd love that. Maybe they'll keep, at some point you got to start the economy back up. Okay. So-

Brett:

We have to. Yeah. What's the alternative?

Ezra:

Yeah. But I think that, stay the course, create assets, expand your audience, do your best to create liquidity for yourself. Improve your cash position in whatever way you can. Run a sale right now, while you can sell stuff. Make some money. Have a little money on hand, so that you can weather any kind of storm that might come up a couple of months worth of payroll, maybe a couple of months, six months or 12 months worth of your living expenses. Look to increase your financial liquidity, if that's available to you, in some kind of way. And now, is a great time to spend. A lot of big businesses were built out of recessions, FedEx, Domino's pizza, et cetera, the list goes on.

Brett:

Kellogg's, great depression, they surpass the post who's always the leader, they gained a ton of market share.

Ezra:

And it's the companies that market during the recession, those are the companies that expand. And so, it's not a time to contract. It's a time to look at how to expand. Hey, what are people buying? Hand sanitizer. I'm going to figure out how to make that organic and natural and I'm going to bring that out. It's a time to look for where can you curate to an offer what people are wanting at this particular moment. The Uber guy, he sold all of this ride share stuff and invested it all in food delivery stuff six months ago. He's a royal asshole according to... Pardon my language... everything. I don't know, what do I know? But I read about how horrible he was to his employees and this and that, the guy who was the CEO of Uber.

Brett:

Yeah. Yeah. Travis-

Ezra:

That guy had some foresight because he got out of ride sharing and into food delivery. So, that was smart .

Brett:

Because everybody predicted this, but food delivery was on the uptake anyway, and this was accelerated in five years.

Ezra:

So, what are you noticing people want? One of the things I've noticed, is anybody with kids... Carrie would be very curious to your opinion on this... they're all struggles city right now. I'm the godfather of a really good friend of mine's kid, and he's a stay at home dad.

Brett:

He's also named Ezra too, right? As in, the kid named Ezra.

Ezra:

No, no, no. That's Shaquille's kid.

Brett:

Okay. Okay.

Ezra:

I'm not his godfather, but I love that little kid. This is Boris' kid, Judah, right?

Brett:

Okay. Yeah. Yeah.

Ezra:

He was my CMO, I grew up with him. Well, he's like, "Man, this is a whole new world. He doesn't have any friends he can go play with. He wants us to play with him all day. We can't do that. We're overwhelmed. We got to work." Parents are struggling. I'm looking at it, what could I do to support parents? How could I create an offer, some kind of entertainment, some kind of product that seems like a market that is going to buy and could really use a value add. And I'm sure there's a million people trying to solve this problem. But I'm just saying, look for problems that you notice with your particular lens in your life experience. What do you notice out there and can you solve that?

Brett:

Yeah. What problem do you see? What opportunities do you see that lines up with your brand and your core message, that is now relevant and fresh and new because of the environment we're in. And yeah, so to talk about kids now, we have eight kids.

Ezra:

Lather your kids in skincare, they will have a great time.

Brett:

Lots of BOOM, Boomsilk, Boom Glo, scrub. All of it. Just you need all the whole BOOM line. That's what you need. What's interesting, is we have eight kids, we homeschool. They do a one day a week school. And they're involved in sports, all kinds of activities and they do get out and there are socially adjusted and all that. So, we've actually handled, I think, this situation better than a lot of people because it's not as different as it is for some. And we have eight, so they can entertain themselves, which is nice.

Brett:

And then we've always been committed like, "Hey, we're not just going to shove the kids in front of the screen. They're not just going to watch TV all day long." So, we've been looking for what kind of activities, what kind of crafts. We're buying things. We just bought a masterclass, which probably skews more to our older kids, but learn how to write movie scripts. And learn how to do photography and cooking. And looking for things like that. So, there is a huge opportunity. I think it's going to continue into the summer. We have a couple of clients that sell like Stay at Home or Crafts and Activities for Kids at Home. They're blowing up. They're exploding. We're looking for angles. I mentioned this on the podcast a couple of times.

Brett:

But one of our clients, Big Blanket, they sell these massive blankets. They went for an angle and we helped them with, "Hey, look, build an epic blanket fold at home." Here's a creative use of our product, used home with kids. So, be thinking about those things.

Ezra:

Smart. Yeah. You should teach people how to homeschool dude.

Brett:

Yeah. I don't know, maybe my wife man. She's the one that knows how to do that. But really, I mean, everybody, we're all forced homeschoolers right now. Right?

Ezra:

How do you homeschool a kid? I mean that's got to be an info product that would sell on Facebook.

Brett:

Yeah. Yeah.

Ezra:

I mean, Brittany's charming. Get her out there man. I mean-

Brett:

That's a good idea. She would do well on video. All right. All right. Well, I got to respond to the post of Blue Ribbon, build a business for Brittany and we're good to go. Hey, so what I want to wrap up with, because I know you got to go, is I'm a huge fan of Blue Ribbon. And I'm not just saying that, because you're on the podcast. I believe, so I'm part of two masterminds, Blue Ribbon, Warren. I believe right now, masterminds are more important than ever. I think, when times are good, you're a mastermind, so you can take advantage of the upside and all the opportunities that are coming. But right now, you need a good community, a good support system to help get your head right, to bounce ideas off of, to find out what's working. To hear about things before you'd hear about them or the otherwise-

Ezra:

It's never been more active Ribbon.

Brett:

Yeah. Yeah. Super tight right now. So, any quick plugs for Blue Ribbon. And what advice would you give to people who are thinking about a mastermind?

Ezra:

I feel that there's power in groups, that you don't know it all. And we are all ever the student. And it really helps to have a group of folks who are doing the same thing you're doing at a high level, who have different areas of expertise, the Google guy. I'm the Facebook sales funnel supply chain guy. Kevin Bombino is the software brilliant financial guy.

Brett:

to survive. Yeah.

Ezra:

So, we got 100, seven, eight and nine figure e-commerce business owners, all CEOs, founders and CMOs in there, who are transparent, who have integrity, who all doing good things in the world, who all want to help each other. And whether you join my mastermind, you can go to smartmarketer.com/mastermind and click to apply. And then, if you are approved, then you'll come to have a phone call with me. I just don't let anybody in. I talk to every person. First of all, you got to get through the approval process, which you just fill out the application, easy to do. I'll take a look at it. I'll either say, yes or no. If I say yes, I'll email you, to set up a call. And we'll talk and see if it's a good fit for you. It's not a good fit if you're under a million dollars a year in revenue, not going to be a fit for you. This is really a fit for brands that are established. That are looking to scale. And looking to have access to a network in community.

Ezra:

And really, what Blue Ribbon is, in addition to that network and that community, and that support, and those events and all that, it is ongoing continuing education for everyone on your team, your project manager, your copywriter, social media marketer, your email marketer, your advertiser. You will not need any other courses or training for anyone on your team who's in a pivotal key role, ever again. This will handle it up to the minute. Every day we're doing stuff, we're sharing it, we're documenting it, my email marketer, my social media person, other people in the group. So, you really have that, I look at it as continuing education for CML founders and CEOs, who have teams who want them educated, but then also want to group for themselves where they can network and collaborate and meet people and all that stuff. That's kind of like that.

Brett:

There's really nothing like this group, the community is amazing. I highly recommend it. The courses are fantastic. I really liked that Google course that you guys have. That the guy that did that Google course was really brilliant.

Ezra:

That's a heck of a course there. It's good course.

Brett:

So, here's my recommendation. If you qualify it, definitely check out the mastermind, we're going to hang out. You can hang out with Ezra. If you don't, if you're not ready for that, that's cool. Go to Smart Marketer, check out the free resources, Ezra puts a ton of good content on Facebook and YouTube and all over the place, that you can really benefit from. So, check that out as well. Check out, BOOM. I recommend you go to BOOM. Get on the email list and see what Ezra is doing, and get educated from that.

Ezra:

Here's the thing though, if you get on my email list, you have to open the emails because if I'm delivering emails that don't get open, that hurts my deliverability. So, I don't mind you spying on my marketing, but if you don't actually look at my emails, you're not doing me any favor. I'm boot you out of there anyways.

Brett:

Exactly. But that's one of my favorite tactics. And I don't do this a lot, just with a few people. Watch what smart people do with their email marketing. You'll learn a lot. It'll influence, add copy to the place. So, All right, man. Hey, really appreciate your time. I know, you've got a jet, Ezra. Thanks for the time.

Ezra:

Brett the fury.

Brett:

That's nice. Brett the fury. Yeah, you gave me that nickname. It has stuck. I have a lot of people that call me, the fury. I need to change my slack handle and some other things to fury.

Ezra:

And you bring the heat, you bring the noise, man, you're really good at what you do. So, thank you for being out there doing it and appreciate you having me on.

Brett:

Thanks brother. All right. Ezra Firestone, ladies and gentlemen. Thanks brother. All right. So, as always, thank you for tuning in. We'd love your feedback. Let us know what you'd like to hear more, less of. If you feel so inclined, leave that review on iTunes that helps other people find the show. And with that, until next time, thank you. God bless you.

Episode 118

:

Dylan Kelley - Wavebreak

Email Marketing in Times of Uncertainty with Dylan Kelley of Wavebreak

My guest today knows a thing or two about growing DTC eCommerce brands to 8 figures and beyond.

My guest today knows a thing or two about growing DTC eCommerce brands to 8 figures and beyond. His agency, Wavebreak, focuses on email, SMS and loyalty marketing for growing eCommerce brands. On today’s episode we talk about how email marketing has shifted in light of the pandemic and how it will likely continue to shift. Ready to take your email marketing game to the next level? Listen to this episode with Wavebreak CEO Dylan Kelley.

Here’s a quick look at what we cover:

How to go on offense without being offensive
How to build community and goodwill now
How to stay true to your brand but adjust your message in light of the recent crisis
Top email marketing mistakes to avoid
How email, sms and loyalty programs work together

‍

Mentioned in this episode:

Chubbies Shorts

Jay Abraham

Retention Marketing - Wavebreak

Resources - Wavebreak

Request a Call - Wavebreak

Wavebreak Podcast - Grow Your Shopify Store

‍

Dylan Kelley - CEO and Founder at Wavebreak

Wavebreak - eCommerce eMail Marketing Agency

Capitalism with Ryan Daniel Moran YouTube Channel

Episode Transcript

Brett:

Hello and welcome to another edition of the eCommerce Evolution Podcast. I'm your host, Brett Curry, CEO of OMG Commerce, and today we are diving into email marketing, and specifically how to handle email marketing in a COVID-19 world. Right now we're in the thick of it as we record this. Obviously we'll be hopefully coming out of it at some point, so some things to consider there as well.

Brett:

My guest is the CEO and founder of Wavebreak, and they focus exclusively on email marketing. My guest is Dylan Kelley. He's hailing from Brooklyn but got out just before everything got crazy in the New York City metro. I'd visited just before it really got crazy in New York City. I think he's joining me from PA right now. Dylan, man, welcome to the show. Thanks for taking the time, and really excited to dive into this topic.

Dylan:

Yeah, Brett. Thanks for inviting me on. Really excited to talk.

Brett:

Yeah. So you are typically in one of my favorite cities. I absolutely love New York. I was telling you before we hit record, I was there like March 7th, 8th, and 9th, visiting clients and stuff, and then kind of got out just before things got crazy. But you got out just before things got crazy as well, right?

Dylan:

Yeah, yeah. I mean, I bounce around. I'm one of those people. We're fully remote to begin with. We actually had some of our team members get caught in the digital nomad thing over, they're over in Asia doing some stuff. We had a copywriter over there and he had to get back to Canada. But luckily I didn't have to do that, but yeah, I made it out just in time back to Pennsylvania, where we've got green grass and it just kind of feels, I don't know, it's like a dream state here too, where it's like, it almost feels like everything is normal, except there is not a lot of people.

Brett:

Yeah.

Dylan:

Outside and in places.

Brett:

So interesting. We live just outside of town where we live. We got five acres, and so we can get out with the kids and go on a walk, and our neighbors have horses. So outside everything feels normal, but then you drive through a near city, Springfield, and it's empty in the evenings. It's really bizarre. You and I were just talking ahead of time before we hit record. The numbers we're seeing in e-commerce right now are very interesting and really quite encouraging. So one of the things I'll share just real quickly and then we're going to get into your background and also our topic for the day, but we built these dashboard where we can quickly see all of our clients. We serve about 85 growing e-commerce brands. We can see their day over day, week over week, month over month, and year over year sales both in terms of the channels we control, Google Ads, YouTube, Amazon Ads, then globally.

Brett:

It was interesting. Even in the early stages of this, like 67% of our clients were up, and about 16% were kind of flat, especially when you're looking year over year. Then the rest were down. Some down just slightly, some down pretty significantly, but actually the numbers have improved. I kept kind of thinking, like the pessimist in me, which I'm a pretty optimistic guy, but the pessimist in me kept thinking, as we get deeper into this, this is going to get worse for e-commerce. It's actually been the opposite for most e-commerce. There are still some areas of e-commerce that are hit pretty hard. But it sounds like you guys are seeing the same thing, right? A lot of your clients are really growing right now in the midst of this craziness.

Dylan:

Oh yeah. I mean, it's crazy. I'm like you, I'm an optimist from the start, so I have this energy, but I'm also this person that's also very anxious. I guess that's how I balance out my optimism. So a few weeks ago when kind of like mid March, when everybody started freaking out, and it almost like time slowed down, and that's when everyone I feel was on Twitter seeing what is everyone else doing, and you're checking your stats every day, multiple times a day. I was freaking out just like everybody else was, but then, just like you said, started looking into the data, and it's like well actually, there's nothing to be afraid of. Sure, sales were down, and it was really weird a few weeks ago, where it's like day by day, week by week. I mean, you wouldn't even know what was going to happen next. But I think things are pretty steady now. Like you're saying, overall, I mean, e-commerce is just going to just keep growing.

Dylan:

We're seeing the same thing on our end. I mean, nearly, we have those clients who are experiencing rapid growth and doing their monthly revenue in a week now, and they're not even selling essential products, right? Think of something that you're selling outdoor, like a rollerskate company we work with. I mean, they've tripled their sales overnight. We can get into how you can use email to do stuff like that and communicate timely, but on the other end too, I mean, even with things that are more kind of like a regular purchase that might not be essential, we still see sales growing there. The biggest problem that I actually noticed after, and I've been hopping in calls with everybody lately, especially in the thick of things. So I wanted to know what was going on. I wanted to share what I knew, and that's kind of the what was going around then.

Brett:

Which I will comment, this has been awesome in our community. I'm glad you're doing that. We've been doing that a lot too. But it does seem like the e-commerce space, it is a relatively small community, even though it's spread out all over the globe, and I love how this industry has really come together and there's just a lot of people sharing information freely, lots of free webinars. Just people getting on saying hey, how can we help? Even if you're not a client or whatever, how can we help? It's really, really cool.

Dylan:

Yeah, I know. I mean, it's amazing to see that, and everyone sharing what's working. I mean, I saw on Twitter a few weeks ago, people were like, "Hey, here's the exact funnel that's working for us right now that wasn't working a year ago or a month ago." I thought that was cool, but yeah. I mean, overall with our clients, most of them are still growing month over month. The ones that didn't, they did scale back on advertising, but usually it was inventory issues and had nothing to do with not getting returns on advertising or marketing, it's just crap, we oversold Q4 because we crushed it, and then we didn't plan for a bonus month off in China for Chinese New Year and this crazy thing happening. But besides that, I mean, now that people are starting to get that figured out, I mean, it's just like.

Dylan:

I saw one stat that was like e-commerce right now is still only 11% of all retail, but with this, based on projections on how people are shopping online, this has the potential to accelerate it to 70 to 80% of all retail in the next 12 to 18 months, or something like that. I think that was a tweet from Web Smith, but it's like holy cow. If this is only a tenth of all the retail transactions out there with the numbers we're seeing now, with the brands we're working with, it's just like, is this an obstacle or is this actually an opportunity?

Brett:

Yeah, absolutely. I think ultimately it's both because you mentioned some supply chain issues, and supply issues and things like that, or inventory issues, but I think it is a massive opportunity. What's interesting, a lot of people are talking about hey, Amazon is the winner in all of this, and I do think Amazon is going to win big, but one thing we're seeing with a lot of our clients who sell on Amazon and on their own .com is that as Amazon is starting to focus in on essentials and just delivering the things that the customers have to have, we're seeing sales that used to be going through our client's Amazon account now coming to their .com. Sometimes there's been shifts of 30, 40, 50% increases on someone's .com because Amazon has slowed down. So I think off Amazon e-comm is going to be doing exceptionally well right now also.

Brett:

Really excited to dive into this topic. We're going to get into email marketing and some dos and don'ts, and we're seeing all kinds of bad examples of what not to do, or good examples of what not do to. But before we do that let's talk a little bit about your background, Dylan. So what did you do prior to starting Wavebreak? How did you get into email marketing? Give us the 90 second rundown of how you got here.

Dylan:

Yeah. I mean, it's really crazy. I was just talking about this this morning actually to somebody. It's like, how the heck did I get in e-commerce, direct-to-consumer, focused on just email marketing of all things? But it's actually a really, it was just an evolution of what I was doing before. So grew up on the internet. I was in high school in this bedroom, slinging affiliate marketing deals, throwing up these landing pages back when you could just rank and bank and it was super easy. I think a lot of people in e-commerce have similar background. Where it's just like you're just kind of on the internet and then saw this wave around e-commerce. I started seeing these cool brands popping up on Instagram actually, like the MVMT watches, and PureVita, these companies started becoming popular, doing a lot of influencer stuff. That was around like 2015, 2016, and I was like, "Man, this looks awesome. These are cool brands." I'm reading the stories, it's growing fast. I was like, "How do I be part of this?" I have a marketing background. Wanted to create a legit company and a stable business instead of just these random affiliate things or hustles that I was kind of running online.

Dylan:

So I decided that okay, based on my design background I'm going to do conversion rate optimization for these companies, because they're spending a lot in advertising. I'm going to help them make more money. So I went and started doing that, and landed a really awesome client. They're seeling millions, one of those social brands. I can't say exactly who it is, but they, you'll see why in a second. So they hired me. They were like my will client, paying the bulk of pretty much all my bills at the time, I was just starting out, freelancer. What happened was overnight bigger brands started to enter Facebook and it just drove up the cost of ads like crazy, and they couldn't figure out how to profitably drive traffic anymore. So I remember I was in the store and I get a text from the CEO of the company. He's like, "Hey, can you talk?" And I was like, it's never good when someone is just like, "Can you talk?"

Brett:

Yeah.

Dylan:

And I call him when I get home, and he's like, "Hey, man. We don't have any traffic for you to optimize, so we're going to have to cancel. We'll send you some free product down the line." Okay, cool thanks.

Brett:

Because that's a lot.

Dylan:

Yeah, that's not going to pay the bills.

Brett:

I'll trade product for rent. Appreciate that.

Dylan:

I know, right? I think my landlord will like that. No, but that really got me thinking, I'm like, "Holy crap. This isn't cool." We're seeing now just the cost to acquire a customer keeps rising on Facebook, even in these times we are now. It's like you talk to any brand, and their return on ad spend is down year over year, year over year, unless they're working with someone like you who is really good at what they do on the advertising front. But just in general it's getting more competitive, more expensive. So I went back to the drawing board and tried everything, from SEO, to social media stuff, influencer stuff, it's like what we do, and that's when I came across email. I was like, "There's no way this is going to work." And ran it through our first client and then they ended up tripling their revenue off it because they had more profit on the backend to invest in their ads, and just fuel growth for the company, and I was like, "Well, that's crazy. I wonder if that'll happen again." And slowly but surely over the last few years we've continued to refine and hone those strategies on email, and now introducing mobile messaging, loyalty and stuff like that with our clients, and just building programs on the backend to really fuel growth.

Dylan:

What's crazy is not only do we uncover extra revenue that's already in their business, but it also gives them more opportunity to have more lifetime value to drive scale, which is super important because I mean, we're seeing VC backed companies. It's like even they can't make the numbers work, which is why these kind of, the brands that we work with, where they're kind of bootstrap. They take money here or there, but they're just smart about growth. It's like they're focusing on profit and lifetime value, and that's how you're going to build a brand that lasts.

Brett:

Absolutely.

Dylan:

And build the next great direct-to-consumer companies.

Brett:

Yeah, it is so interesting. Customer acquisition costs are going up across the board year over year. We're seeing a dip in some costs right now. So CPMs are lower on Facebook, and I'm not a Facebook Ads guy, but just I hear cost per view is definitely down on YouTube right now, but conversion rates are also down in some cases, and things will get back to normal at some point and costs will continue to rise again. So that's one of the things I love about email marketing. One, it absolutely works, and you have to do it. I don't see it going away anytime soon, but if you do it right, it allows you to spend more money on the front end doing top of funnel type marketing, and that's what we do a ton of. So I love it when there are guys like you or people like you that help optimize the email flows because then I can be more aggressive on the advertising side. So beneficial for sure.

Brett:

So let's dive in and talk about what's going on right now with email marketing, and you and I were kind of joking as we were talking about this a few days ago. We've seen just tons and tons of examples. I think every single email list that anyone ever subscribed to felt compelled to give us their COVID-19 update, whether we wanted it or not, and we didn't want it in most cases. What do you see as the ... Is that starting to slow down, and why do you think that was a bad idea, and just any thoughts on that besides the obvious?

Dylan:

Yeah. No, I mean, I'm glad you brought that up. I actually sent out an email not about it, and my subject line was, "Not an email about that." That's to our private newsletter.

Brett:

Not a COVID-19 update.

Dylan:

Yeah, exactly. We actually wrote like a manifesto on the future of e-commerce. Anyway, we can get into that later. But yeah, I mean, in general it's like nobody cares that your support team is working inside. It's just like that's not going to, I didn't ask.

Brett:

Yeah. I think that's the ultimate lesson here. Is you felt compelled to answer a question that no one was asking you, right?

Dylan:

Yeah.

Brett:

I forgot I subscribed to your software, I'm glad that you're taking care of your employees, but all you really did was remind me that I need to unsubscribe from your list.

Dylan:

Yeah, a 100%. I mean, we sent some of those email out for clients, but not to everybody. Hey, we're still shipping. It's more like an update if there was going to be a delay.

Brett:

It's very relevant in some cases.

Dylan:

We would send that out.

Brett:

For sure.

Dylan:

Yeah, yeah. But it's like so many companies were just blanketing it, and at the same time it's like, I'm still getting some emails from that. It's like listen, people aren't worried about that anymore. Like you and I were talking, I mean, two weeks ago people were freaking out. They thought it was the end of the world. Now that we've survived these few weeks, it's kind of like okay, this sucks, things are different, but we don't feel like we're going to die tomorrow, or at least most people don't.

Brett:

Yeah, for the most part. I think there are definitely, and who knows what's going to happen in the future, but it definitely seems like okay, hey, we're seeing a path back to normal, curve is flattened, things like that. So yeah, or flattening I guess would be a way to say it. So yeah, I think there's definitely this hope that normal is on the horizon, which is good.

Brett:

So let's do talk about though how have you shifted your message? Because I think these blanket COVID-19 emails, and people, companies answering questions that nobody is answering, that's not good, but how have you meaningfully shifted the messages in the emails for your clients, and let's talk a little bit. You mentioned to me a few days ago, looking at Maslow's hierarchy of needs and how that's kind of shifted. You want to speak to that just a little bit?

Dylan:

Yeah, yeah. I can start with that. I think that's the important place to start, is not, because so many people look at email and marketing as I guess tactics instead of what is actual consumer behavior, what is the actual strategy behind that, which is the most important thing. That's why Wavebreak can drive results that other people can't, because we go so deep on strategy because we're really thinking about how consumers buy, not just how do we make a great email or find the winning sequence and craft it together. We think customer by customer, product by product, brand by brand, what really makes the most sense. So people always think it's crazy when I break it down like this, but I think it's going to make a lot of sense.

Dylan:

What you were talking about with the hierarchy of needs, everybody knows the pyramid and how at the top it's just the whole, that's where we were a few weeks ago. We were at the top of the pyramid. It's like we're communicating be your best self, achieve your full potential, because everybody's basic needs were met. Especially here in America, where the majority of your customers live, we're communicating to that level, but in a matter of days, and even in hours, it's just like, I mean, things shifted fast and we jumped down that pyramid all the way down to where people are now not thinking how do I be my best self, but they're thinking more about safety, and they're thinking more about community. If you keep trying to market to the top of the pyramid, which is hey, be your best self in our leggings, or act like nothing is going on in the world, it's just not going to hit. It doesn't mean stop marketing. That's the worst thing you could do right now, because eyeballs are everywhere. We even see this with email.

Dylan:

Open rates, they're higher than they've ever been. Email conversions are up 30%, but it all comes back to what the heck should I be sending right now. We should be thinking about community and you should be thinking about just safety. Give people a break from normal, but at the same time let them know, in the beginning you wanted to kind of address it a little bit more head on, but now it's like we're noticing you need to be less direct, because we've been monitoring this very closely with our clients, and when we're more aggressive with our emails. When I say aggressive, I just mean sale offer and we're super direct and that type of thing. We noticed that people are starting to get mad at that, with certain messaging, especially among demographics that are really affected by this. So if you think younger people, you think people who work paycheck to paycheck. If you run a company that sees sales spikes around when people get paid, it's like that's something you want to take into account because these people might not be getting paid right now, so the wrong messaging could really make them mad. People are stressed out. We'll get the most responses between 12:00 AM and 3:00 AM of complaints from people.

Brett:

Interesting. Yep, yep.

Dylan:

And I've talked to people about Facebook, who run Facebook Ads and get comments like this and they say they'll even reach out the person, they'll find out the person was literally drunk. But it's like, I mean, I wouldn't be surprised if some of these people replying are in that place because it is a tough time.

Brett:

It is.

Dylan:

And you want to make sure your messaging is less aggressive. So instead of like, "Hey, sale ends tonight. You're dumb for missing out." It's like hey, here's a way we're giving back to the community, so on and so forth.

Dylan:

So for example, we have a client that sales phone cases. We still ran an Earth Day sale to remind everybody hey, it's Earth Day. The planet is more beautiful than it's ever been, and in addition they have a great charity aspect to their brand, because they're donating two organizations that help towards COVID-19 stuff this month. So we made sure to put that in too, where it's like listen, we're super relevant with the messaging, and at the same time we're acknowledging it, but we're not going as aggressive as we were, where it's like, "Hey, it's Earth Day, you got 24 hours to save. Be there or be square."

Brett:

Right. Yeah, promotional stuff. Yeah.

Dylan:

Honing it back a little bit. That's kind of ... A lot to unpack there, so I'll just leave it at that.

Brett:

Yeah. No, that's fantastic, and we'll kind of dig into it a little bit, and I love that you went to Maslow's hierarchy of needs and finally getting something useful from some of the psychology classes in school. No, I liked psych. So as we look at that, I think there may be some elements of getting back to self-actualization before too long. That could happen in weeks rather than months, who knows exactly.

Dylan:

Yeah.

Brett:

But I think definitely drilling into community and how do we help one another, and safety. You can't go wrong there. So let's kind of unpack that just a little bit. So do you have other examples? So you mentioned this one, the self-owned company. They're doing some charity efforts, and so the email is kind of about that. The hey, here's the Earth Day sale and when you do that you're helping others. I've seen that work for a few clients, where one in the laundry detergent space was like, "Hey, for every item you purchase we're donating something to these local shelters or we're donating to first responders." Or things like that. Any other examples along those lines that you've seen working right now?

Dylan:

Yeah, I mean, ultimately you got to make it work for your brand, which every brand is different. If you don't have a charity aspect, you don't have to add a charity aspect to your brand. That's what we've been telling people, but there's always an angle to it. It might even mean, because the biggest thing we're noticing now is like it's really easy to get eyeballs. Conversions might be down overall, like you're seeing on Facebook or wherever. As a merchant it's easy to get these eyeballs because everybody is everywhere. People aren't buying the same, but what we're going to see is as soon as that end date is put in sight, people are just going to start spending like crazy. That's when the gates are going to open up. But if you try to market then, you're going to be too late, and that's why I love how you mention community, it's like that's really what email is about, and that's what the top brands have figured out, that a lot of the mid market merchants who have just built on the back of Facebook, and kind of built this company over the last few years. It's like that's where they need to head, and really think about how do I build community.

Dylan:

So for example, if you're normally just promoting product, product, product, what can you do to add value and what can you do to just provide some entertainment, to provide something? If you have blog posts, you can feature blog posts. If you're doing Instagram content. It's a great time to get people to ... Like I saw a great campaign, I think it was Chubbies. They ran something where it was like be the first stay influencer or something.

Brett:

Nice. I like that, yeah.

Dylan:

Really creative stuff. But yeah, stuff like that, and then obviously if your product gets people outdoors or solves a problem like that, like we were talking earlier, roller skates are crushing like crazy right now. But if your messaging is hey, get the best indoor roller skates, that's not going to work because all the roller rings are closed.

Brett:

Yep.

Dylan:

But if you think this is a great way to get outside. We know a lot of parents are on the list buying for their kids. It's like hey, get them outside, let them get their energy out, that sort of thing. Just really promoting what's our angle.

Brett:

Yeah, I think that's what you've got to look at, is how do we stay true to our brand, and I love that you mentioned that because that's something that really shouldn't change. You're maybe going to pivot a little bit in terms of what problem you're solving, or how you're solving it, or the way you're presenting things, but the core of your brand isn't going to change, right? And one of the things that's ... One great example, and I love this company even outside of the crisis, but Huckberry, men's fashion and other thing, did a great job with their email marketing. They've been doing several work from home sales, and they've been pitching, I think they created this, I don't know. They're the first ones that I've seen to mention it, but the work from home mullet, and it's basically business up top, party below.

Brett:

So it's like hey, we know you're rocking shorts or whatever, but here's how you look good from the top up, so it's like a sale on these sweaters, and it was talked about in a really fun manner. But then they also had tips for how do you brew coffee at home that's a little bit unique. So of course there's the tried and true ways, but try something different. We all are consuming coffee in mass quantities, here are some unique ways to brew your coffee. Then they had show us your work from home set up, tag us and you can get free stuff. So it's all kind of geared around hey, we understand where you are. We're trying to bring a little bit of humor to it, not making light of this situation, but just bringing a smile to your face, we're all in this together type of thing, and then giving you some bonuses and whatnot as well.

Brett:

So I think, you mentioned it, I've heard a few other people mention it as well, that now is a great time to build your list, to build that community, to get more people following you. Do you have any tips of thoughts on that? Anything you're seeing that's unique for building an email list right now, or is that even something you're focusing on right now?

Dylan:

Yeah, I mean, I definitely think now is a great time to build out your foundation to really get set, because we've never had, yes, things are crazy, but things are also kind of slower in a way. We've been talking about this for years. We did a, Klaviyo had us do a guest post last year on priming. How we get lists primed for Black Friday, Cyber Monday. So many people don't even think about that, but that's kind of what you want me to look at right now. Is like how do I get people engaged with our email? And that example that you shared about hey, coffee tips, you're getting people to open your emails.

Brett:

Love it.

Dylan:

People love to buy, but they hate being sold. But if they never open your emails because they know you're always selling something, they're never going to buy. So how do we use this time to get people to open more emails? And as far as in the list, I mean, I would say a lot of people right now are looking to save that extra money. They're looking for that free shipping, they're looking for that discount, and a lot of brands are running their sales, which is even large companies. They're just like, "Yo, here's the code." It's like well, you could get the same conversion rate off that if you gate it with an email or even like a mobile number opt-in, and then you follow up with that person. It's a great opportunity right now to take advantage of that and really build your list from that perspective, especially as people are looking for it, and to first time visitors too. You could segment that out, but yeah, I don't want to get too deep into the weeds, but that's kind of what we're seeing on our end.

Brett:

Yep. I love it. I love it. Any other tips or ideas, and maybe looking at kind of your structured email or your scheduled email. There's another term for it that I'm drawing a blank on.

Dylan:

Cadence.

Brett:

Yeah, cadence, and even thinking about abandoned cart emails, some of your auto email things. Any recommendations on how those should shift right now or should they?

Dylan:

Yeah, I mean, definitely check those out. Look at all of them just in case. I mean, you're probably too late at this point, but it would've been a good idea a few weeks ago to just run through all the emails you had set up and all of your future emails going out just to make sure there's not any messaging that people could find triggering. So we work with some brands who are really, like for example if you think of a company like Chubbies who has really fun copy. We work with a lot of brands like that who sell crazy different products, so in men skincare and stuff like that, but it's like we're kind of toning back the messaging, where we might be a little more casual and a little more fun. We just don't want people to take it the wrong way, because people are really sensitive right now. You want to look, and a big thing is with your evergreen sequences that are set up and always running, your abandoned cart, you could have that mixed in and you just want to make sure that you don't leave that bad taste in people's mouth because that's how they're feeling.

Dylan:

Then we're a little bit past this since, like I said, it's a little ... A few weeks ago people were freaking out. They what was going to happen tomorrow. They weren't sure, it was like the world was going to end and we were just waiting for it to end and we didn't know. But now we've kind of gotten over the hump it seems, as far as just people, there's more hope and there's more optimism than there was, and so with that just realizing that now you're going to be able to, you don't have to be as timely as you did a couple weeks ago. Two weeks ago really good to be talking, hey COVID-19, here's what we're doing, blah, blah, blah. Now it should just be kind of like a bullet on the email. Hey we're donating to X, Y, Z to support for this, but you're not leading with it anymore because people are kind of back to normal. I think we're going to see that as we sort of get to the end, is think about that and then also think about like, I mean, Fourth of July, Prime Day or whatever, it might even be before that, that's going to end up crushing. So just also keeping that in mind too. So if sales are down now, just thinking about oh, this could be coming later, so how do we optimize now so we can profit then?

Brett:

Yeah, interesting. So it's a really good ... This is maybe a good time to kind of transition. Let's look at email marketing in general, right? So eventually things will get back to normal, and who knows when exactly that will be. There'll be I think probably pockets of the US that get back to normal much quicker than say New York City as an example. But what are some common email marketing mistakes that you see? So just in general, and what are some of those top mistakes to avoid? And then we'll look at kind of some of your top email marketing tips as well.

Dylan:

Yeah, for sure. I love how we're starting with the mistakes. I'm going to talk about things that people don't really think about but actually make a huge impact. I mean, the first thing is actually pretty obvious, which is not having email marketing, which at this point you should know that you need email. It's the most tested and true channel. It's lasted over 20 years in e-commerce. It's still a major revenue driver, even for leading brands that are selling billions of dollars per year. So if you don't have email, you're missing out. But a lot of brands already have email, and that's actually one of the big mistakes that people do have, is you have email but it's just email to squeeze out extra revenue. There's no deeper strategy about how it fits into your brand. So you'll see-

Brett:

It's just purely a tactical play and not thinking about the strategy, yeah.

Dylan:

Exactly.

Brett:

Or community.

Dylan:

Exactly. I think it even comes back to in e-commerce, especially as you're scaling a company, it's really easy to be shortsighted on just strategy and hey, let's throw up a sale tomorrow, instead of planning. That's actually a huge mistake, because when you plan and you have a long-term strategy, you can actually move faster and get even better results. So step one I'd say is like zoom out and know where you want to go and reverse engineer it. Don't plan for tomorrow but plan for next month, next quarter. Really the smartest brands are thinking like that, because then you're able to pull more levers and really be smart about growth, and then integrate that into your email strategy where email becomes this arm of your business and the foundation of your company, and just going deeper there.

Dylan:

Another mistake is not thinking of email as this extension of your brand, which it totally is. You go, someone has their 100,000, $300,000 e-commerce website that they got the best agency to put together, they have amazing packaging, and then you go to buy and the emails look like grandma made them. No offense to grandma, but I don't think she's the best direct-to-consumer email designer in 2020. This is a huge missed opportunity because it can leave a bad taste in people's mouth, especially if you have a premium product. Then if the emails don't flow together, all of that. Email is a huge way to not just extract extra revenue for your business that's already there that you need, but also to build a real brand, which that's what's going to last. We've seen the trend over the last five years, right? Drop shipping went through the roof, it was this thing, but since it was front heavy on acquisition and there was a bad customer experience, none of those companies are around anymore, unless they were able to make the transition into being a real brand.

Dylan:

That's the future, even for this bootstrap companies. The next leading direct to consumer brands probably aren't going to be raising tons of money from venture capital, because we see that doesn't work. Warby Parker was great, the other companies not as good, right?

Brett:

Right, you're seeing. Yeah, there's definitely been some bad press about some of these venture backed EC brands, and some even ... I think I saw Casper recently that had a massive valuation at the beginning and now it's worth like a $100 million or something like that.

Dylan:

Yeah, it's less than their annual revenue.

Brett:

Yeah, it's really interesting. So yeah, the way that plays out going forward is going to be really, really interesting. So yeah, cool. Continue. Other email marketing mistakes that you see.

Dylan:

Yeah, yeah. Well it's like that's huge. Email is a big thing to build your brand, and if you don't have that cohesive experience, you're leaving a ton of growth on the table. You think of a company like Nike. I would love to see inside their ads accounts because I bet they just print money like crazy.

Brett:

Me too. I would love to manage their ads accounts.

Dylan:

I know. Dude, I don't even know anything about Facebook Ads, well that's not true, but I know very basic things about Facebook Ads, I could probably run good ads for them because they're such a powerful brand, everybody knows it, and that's where email is overlooked. It's a great place to communicate your brand, and then from there, that's how you build a $100 million e-commerce company, right? You have a solid brand, because ads can only carry you so far, until you get that word of mouth, that brand recognition, even if it's just in your space, when you see better numbers, it's just easier to grow. Really looking at email and lifetime value as one of your top numbers, because like we said in the beginning, return on ad spend, not as great as it used to be. There's more competition every year.

Dylan:

I talk to a lot of brands and CEOs who they're worried about, not the big companies anymore because they disrupted them, right? I don't like the disrupt word, but they proved that they could come in the space, and now they're worried about people coming and doing the same to them, and increasing competition in advertising and just making it less profitable. But if you focus on lifetime value, which very few brands are, that's what's going to put you ahead, because it's going to put more profit into your business and it's really the lifeblood of every e-commerce business, but I don't think many people know that. They're looking at their return on ad spend every day, but do you even know your lifetime value? That's the metric that's-

Brett:

Very, very, very few e-commerce companies do. We talk to e-commerce companies all the time, and in their defense it is pretty tricky to calculate lifetime value, but I mean, there are some variations of it and you should at least have a goal of getting close to knowing your LTV for clients, because without that it's really hard to make marketing decisions.

Dylan:

Oh, it's super hard. People don't even know their numbers, and that's the last mistake, is not knowing your numbers and then not taking your email strategies to work that, because email is the highest converting channel. Send more email, you're going to increase your conversion rate.

Brett:

Yeah.

Dylan:

Increasing repeat orders, best way to do it. It's been proven, it's amazing. Same with like we're saying, average order value, lifetime value. You do upsells really easily, bundle products, run promotions. Do all these things strategically to move those metrics, and you just increase your traffic or conversions by 25%, your average order value 25%, and your repeat orders by 25%, then you double your business. I mean, we even see this with eight figure clients who are doubling from 10 to 20 million a year and beyond. It's wild how these little numbers, little increases can make a huge impact on your business.

Brett:

Yep. It's so interesting, and it sounds like ... Are you a Jay Abraham fan? Do you know Jay Abraham?

Dylan:

Oh yeah.

Brett:

Yeah.

Dylan:

Yeah.

Brett:

He talks about the three ways to grow a business, and it really hasn't changed, even in the e-commerce world, and he talked about this a couple decades ago, but the only three ways to grow a business are more new customers, increase average order value, and increase frequency of repurchase, right? And usually though when people think grow my business, they only think about that first lever, more new customers, which I love that, I'm a traffic guy. So we like to bring in more new customers, but if you can just get modest increases in all three of those areas, then the overall impact, like you said, you got 25% increases in all three areas, you double your business and it's pretty powerful.

Dylan:

It's a cheat code. Don't get me wrong, I'm all for traffic and our most successful clients-

Brett:

Yeah, yeah.

Dylan:

Are driving as much traffic as possible, but people forget about the backend often because there's just so much going on. That's why companies hire us, because we come in and then we just execute that.

Brett:

Love it. Now some tips. Just kind of as we wrap up here or near the close of our time, what are some of your email marketing tips, suggestions, your top email tips right now?

Dylan:

Yeah, I mean, right now one of the lowest hanging fruits is community. People are really craving that. Open rates are higher than ever. Email is just cutting through the noise at unprecedented levels that it hasn't in a very long time. So if you're not emailing and you're taking your foot off the gas, that's a huge mistake. Like we talked about, it doesn't mean you have to be promoted, but the number one thing you can do is just be consistent. Be consistent. Be consistent in how often you communicate. Be consistent in your branding and your messaging. You don't want to give people design shock. You don't want people to think, "Who the heck is this?" And be consistent in adding value. These are people on the other side. It's not just hey, let's send more email, make more money. You're going to burn out your list. It's not long-term.

Dylan:

The second thing I would say is creative, it's such a low hanging fruit. I'm sure anybody who runs ads know that creative is really one of the biggest differentiators in success of your brand. Yeah, no brand has good creative on email. It's very, very rare, because it's just like an afterthought of hey, let's throw this together, we'll send an email tomorrow. You can actually use this to make more money and really build a successful brand.

Brett:

When you say creative, are you more concerned about the copy, you're more concerned about the design and the aesthetics of the email, or is it both, and any thoughts there?

Dylan:

Yeah. So it's definitely both. A lot of people listen to podcasts like this, and someone will say, "Hey, plain text sells like crazy." Everybody is like, "Oh, we should do all plain text." It's like, no. Don't do all plain text. We do a lot of stuff like that, but ultimately, I mean, you want to be really specific about when to use it, but what you want to think about is the average attention span when someone opens an email is like 10 seconds, less than 13 seconds. So how do I grab their attention? If you just have a big paragraph there it's like, next. Then they have your competitor's email.

Dylan:

Right. You want the subject line to open the email, and then you want the design and copy to get them to click, and then let the site to the rest. A lot of people try to give their whole story and give like five million different things in an email. It's like focus on one thing per email, make it look good. It doesn't all have to be fancy graphics, but make it eye catching because you only have those 10 seconds, and then make it easy for people to skim, because so many people are on mobile, you're cramming paragraphs, people aren't going to be able to read it. Then make sure there's one focused offer works really well, because otherwise people get overwhelmed and when they get overwhelmed, they do nothing. That's really the basics when it comes to creative, and then also consistency. You want to make sure everything is on brand. I see companies who, even with large companies who, they just fire an email every day, but the button colors will change every day. It's like people aren't going to know your brand then, have a style guide, get it updated. Branding is really the future of e-commerce. If you don't have a brand, you're not going to make it, and email is one of those places where it's super important.

Brett:

Cool, I love it. Actually I know you guys do more than email. So any new trends, or tips, or ideas around loyalty and some of the other things you're doing, whether it's SMS marketing or anything else like that?

Dylan:

Yeah. The biggest thing is stop looking at all these things as tactics and start thinking about how they integrate together. Because you could have an SMS program, you can have an email program, you can have a loyalty program, but if they're all fighting for each other, you might see some incremental revenue increase, but you're not going to see any massive growth. That's really what we do with our clients, is we come in and make it all comprehensive and integrated together so that if you get hit with an email and you don't buy, then you get hit with a text. If that doesn't happen or you go to the site, and maybe there's some on site messaging, or how do we drive people to loyalty. I see brands with loyalty pop-ups on my first visit. I'm like, "I'm not going to join your loyalty program."

Brett:

I'm not even loyal yet there, bud. Yeah.

Dylan:

What is a something point, it's like a Dylan point. You get a Dylan point, bonus Dylan points on these orders. It's like, I don't even know you yet. That would be much better if you're trying to capture an email, or get somebody to make that first purchase. Yeah, mobile messaging is great. It's cutting through the noise too, but you have to be careful. A lot of people don't know this, but Fashion Nova, they had a $50 million class action lawsuit against them because they didn't follow the rules around mobile. It's like email, 15, 20 years ago. They're going to be making examples of brands. Fashion Nova was one of them. You hear about a $50 million lawsuit and you're like, "Screw that. We're going to operate within your rules." They're still studying those examples now, so you got to make sure that if you're doing SMS stuff, yes, it's easy to fire on that campaign, but you got to think about am I doing this within the law? That's huge. There's hours you have to send in. There's amount of messages that you can't exceed. A lot of people don't know that, and that can end up costing you literally millions of dollars.

Dylan:

So when you're thinking about this stuff, think about how it comes together. If you want to build a long-term business, also think about instead of being aggressive for short-term wins, think about how do I build a business that lasts and really create community by just being consistent with my customers and not going too aggressive. It'll also keep you out of the court system.

Brett:

Absolutely. How can we build a community, be strategic, and yes, keep ourselves out of jail is a good thing. So I love this. Dylan, this has been fantastic. I think really just if you look at all of these tools, email, SMS, loyalty programs, it's really about delivering the right message at the right time in the right way. To build a community, to build good will, yes to drive sales and increase lifetime value, but to do it all in a way that builds the brand long-term and serves clients and does the right thing.

Brett:

As we wrap up, how can people, one, get in touch with you if they just want to chat with you or learn of Wavebreak and help them, and do you have any resources or guides or anything that people should check out?

Dylan:

Yeah, for sure. We have a ton of resources on everything I talked about. Obviously we don't have hours to get into this stuff, but we do a ton of webinars, video trainings. We just published a really in-depth guide kind of on this, retention marketing as a whole comprehensive strategy for growing an e-commerce brand. That's at Wavebreak.co/retention-marketing. I can give you the link to link it up.

Brett:

Sure. We'll put it in the show notes and so we'll there too.

Dylan:

Yeah. Wavebreak.co/resources. We also have a private newsletter there where it's not a blog post. I'm impressed with it myself. We get a ton of great feedback on it. A lot of leading brands on the list. Yeah, just giving our insider insights on what we see every day and every week. It's real time, straight from me, it's not your generic newsletter. It's a private newsletter, what's working now with our eight figure clients. Then beyond that if you are a brand who is mostly focused on the front end with advertising, and know that on the backend your email, loyalty and all that isn't working together, it might actually be hurting you and they're just more money and more potential there, you go to Wavebreak.co/call. You can request a call with us, and that's still with me. I still run all our sales and stuff. So you.. A compliment call directly with me, and we'll literally just talk like you and I are, Brett, just about your business and whether it makes sense to work together or not. I mean, I'll point you in the right direction. At this point I know a thing or two about scaling a successful D2C e-commerce company, and I'll know where you're at and what you need to do, and if we can help, then we'll go down that path, but that's Wavebreak.co/call.

Brett:

Love it, man. Phenomenal insights. I know we're in definitely interesting times, to say the least, from a marketing, and e-commerce, and D2C perspective. Appreciate you sharing your insights. Appreciate you making all those resources available, and you guys have done fantastic work for eight figure e-commerce brands. So definitely check it out. Check out, and you've got a podcast as well, right? And that's available at Wavebreak.co too. Is that where we'd find that?

Dylan:

Yeah, you check it out there or you can go to wavebreakpodcast.com. So another e-commerce podcast, top five ranked. We've interviewed a ton of great people, founder and CEO of PopSockets, their brand, all the great companies behind their company, how they've sold ... I mean, at this point we've got people ... We're probably getting close to a billion in revenue combined of all of the people we've interviewed on the show.

Brett:

Amazing.

Dylan:

So really good insights there. If you like this podcast, you'll really enjoy it as well.

Brett:

Absolutely, yeah. Wavebreak Podcast, check that out also. Dylan, man, bringing it today all the way from PA. Really appreciate you taking the time, man. Thanks for sharing your insights, and we'll have to do this again sometime.

Dylan:

Yeah, for sure. Thanks for inviting me on.

Brett:

Yep, absolutely. As always, we'd love to hear from you, our listeners. Would love that review on iTunes if you feel so inclined, and with that, until next time. Thank you for listening. And that's a wrap.

‍

Episode 117

:

Ryan Moran - Capitalism.com

Turning Adversity into Opportunity and Succeeding in the New “Normal” of Ecommerce

Ryan came on the show to discuss some burning topics facing all entrepreneurs right now.

‍

This is an episode a couple years in the making. I’m a huge Ryan Daniel Moran fan. We had dinner together after an event for speakers at an event in LA a few years ago. Then we both got busy. Ryan came on the show to discuss some burning topics facing all entrepreneurs right now.

Advice for an eCommerce company who’s struggling right now in the pandemic
Advice for an e-commerce company who’s excelling right nowThe number 1 way to be instantly happier right now (and it leads to better business outcomes)
How Ryan thinks about eComm companies to invest in - it’s way more about the leader and the product than anything else.
Not playing the comparison game
How to instantly be happier where you are right now
The 3 phases of growing to $1 million in 12 Months.

Connect with Guest:

Ryan Daniel Moran - Founder of Capitalism.com and The Capitalism Conference

Capitalism.com - Create the Change

Podcasts by Capitalism.com

“12 Months to $1 Million” Book by Ryan Daniel Moran

Mentioned in this episode:

“12 Months to $1 Million” Book by Ryan Daniel Moran

Podcasts by Capitalism.com

Capitalism.com Podcast Episode with Moiz Ali

Exit Strategy Podcast with Moiz Ali

Native Deodorant

The Capitalism Conference (CapCon)

The One Percent - Capitalism.com

“Everything Is F*cked” Book by Mark Mason - Amazon

‍

Episode Transcript:

Brett:

Well hello and welcome to another edition of the eCommerce Evolution Podcast. I'm your host Brett Curry, CEO OMG commerce. And I got to say I am beyond excited about today's episode. This is an episode that I've been dreaming about, thinking about for a couple of years probably or more.

Brett:

My guest today really doesn't need an introduction, but I'm going to do it anyway. So today I've got Ryan Daniel Moran, he's the founder of capitalism.com and the capitalism conference, which I was just sharing with him earlier, I've had several people, several entrepreneurial friends, people I trust say it's the best event they've ever been to. I shamefully have never been. So I will remedy that once we're allowed to leave our houses and do events again at some point. Ryan's also the author of a brand new book called 12 Months To 1 million. I'm a huge fan of Ryan's podcast. He's introduced me to some amazing people, financial planners and other things and so consumed a lot of his content. I love the way he thinks about business and about building brands and the way he's just super honest and relatable and fun. And so with that, Ryan, welcome to the show man. Thanks for taking the time.

Ryan Daniel Moran:

Brett. Thank you so much. I'm not sure I can live up to that podcast. So thanks for listening everybody. See you later.

Brett:

And we're done. That's a wrap.

Ryan Daniel Moran:

See you. Thanks for coming.

Brett:

That's amazing. It's amazing. So we were just talking now, hopefully people will be listening to this podcast for years to come. We are though recording during the midst of quarantine and lockdown and there's potentially an end in sight. We hear people, different states talking about opening up beginning of or whatever which is a few weeks away at the time of this recording. So I want to dig into a few things. I want to talk about your mindset. I want to talk about the way you're processing this environment specifically related to e-commerce. And then we'll get into some other fun stuff, investing and other cool stuff, which I'm excited to pick your brain about. So I know you're viewing this as an opportunity, right? It's a challenge too. There's hardships, it's difficult. We don't want to downplay that. But why and how are you viewing this as an opportunity?

Ryan Daniel Moran:

True story. Yesterday I was speaking with someone that I hadn't met before and the Zoom fired up and that person said, "How are you doing Ryan?" And I said, "I'm doing really well. It's great to meet you. How are you doing?" And he said, "I'm fine all things considered." And I didn't even think about it. I said, "Oh, what's to be considered?" And he looked kind of surprised by that statement, but I was being very genuine in my question because I think in all situations and in all cases, you are whatever you're considering. That phrase, all things considered, it's just all things considered. I mean, are you considering the fact that you woke up this morning in a comfortable bed and got to spend your day structured however you chose it with people that you chose to spend it with? I mean, all things considered, the sun shone this morning and it is about to be the best time a year. I mean the fact that we're listening to a podcast right now about business and investing-

Brett:

Yeah, for free, wherever we want to listen to it.

Ryan Daniel Moran:

For free. Yes. I mean, and somebody will say that's trite. That's easy to overlook. Everything is easy to overlook. It's easy to overlook the number of deaths from a pandemic. It's easy to not think about it. It's easy to not think about the economy. It's easy to not think about how many people died of a heart attack this week. And I don't mean to be crass, I just mean that we're in control of whatever we focus on. And when we're having things beamed at us all of the time, it requires us to be more intentional about focusing on what it is that we want. And so I just made the decision about three weeks ago that I was no longer going to pay attention to the things that didn't serve me.

Ryan Daniel Moran:

A good kind of comparison to this is in college, like every good college person, I went down a bit of a conspiracy theory rabbit hole. I think most people go through that period in their life where they're like, they question what's normal, they question the narrative, they question the official story. And so I went down a little bit of a rabbit hole. And after a while, I finally just had to ask myself the question is consuming all of this information about this topic making my life better? And it wasn't. It was making my life far worse. It was making me scared to make decisions. It was making me fearful of other people. It was making me really negative. And I feel the same way-

Brett:

And conspiracy theories are kind of like junk food, right? Where they're like really tasty and really enticing. But afterwards you're like, oh.

Ryan Daniel Moran:

I've heard them described as pessimistic porn. It's like bad news. You can't stop looking at it. But if someone else walks in the room you're like, "Oh, what? No, I'm not going to conspiracy theories." And so I view the pandemic as kind of similar, not that I'm suggesting it's a conspiracy theory, but just that the idea of does consuming more and more information and making evaluations of what could or might not happen serve you? And the only way that I think it might serve us is if we evaluate how we can use this to become better business owners, to be better family members, better leaders. How if there was a way to turn this into an opportunity, what might it be? I mean for me personally, I needed some way to turn this into a positive quickly. So I just decided, you know what I'm going to do is I'm just going to get into the best shape of my life.

Ryan Daniel Moran:

I'm just going to really clean up my diet. I'm going to really focus on my mental health. I'm going to read books, I'm going to journal. Even if I get nothing productive done, I could look back and say, "You know what I did in quarantine? I spent a ton of time with my daughter and my youngest son and I read books and I journaled and I thought about what I wanted and I got into a great shape and I went for long walks and I saw nature and I listened to podcasts." And you can turn that into whatever experience you want. So that's how I'm handling quarantine.

Brett:

I love it. And I think it's really just a shift because we've all probably gone to some dark places at least momentarily during all of this. For me, I've had a couple of bouts of just kind of wrestling with anger a little bit like man, why can't we just fix this? Or why does this have to happen or why ... But I get over it pretty quickly. I think what I'm hearing you say lines up with kind of my thinking too, is that if you could go 100% into what you can control and zero or as close to 0% on the things you can't control, that puts you in a lot better space because you can't control when the lockdown ends. You can't control the spread of COVID-19 other than just your limits. And certainly you can't impact any of those so why worry about them? Spend 100% of your time on things you can control.

Ryan Daniel Moran:

That's exactly right in all cases, all the time especially right now. I mean, you know what? I've had a lot of conversations with entrepreneur friends who have expressed that for what some reason they're feeling a little bit happier than normal and I wasn't quite sure why that might be at first. And I started to process it because I could feel it when I saw the opposite happen for me. I mean I had one really bad day when it happened. And I caught it. It was when I talked to a friend and all they were talking about is how much they were killing it and how much they were selling and how they were growing. And I had this little twinge of, oh, like I'm behind. That little thought in the brain that is like I'm behind. I'm not enough. I'm not growing as fast as I should be.

Ryan Daniel Moran:

But what was interesting is all up until that point, I hadn't heard a single thing about anybody else crushing it or killing it in three weeks. And I think that's why a lot of entrepreneurs are feeling a little bit of this like I feel kind of relieved. I feel kind of at peace because we're not playing this comparison game that is constantly going on in the internet marketing world about how this person's ad is killing it while this person's product is growing. And this a hole Ryan Moran sold his business. And like all these wins that everybody else is having except for me, that thought loop that is going on in so many of our brains has quieted down because we don't see all of the wins of everyone while we're all focused on this problem. And I think that's actually then a really healthy step back for a lot of the entrepreneurial world.

Brett:

Yeah, almost like a reset, you know? And I love the fact that you mentioned reading. My wife and I, we were consuming potentially a decent amount of Netflix in the evening. I was still getting a lot of work done, still getting a lot of work done. But after a few nights I was like, "I'm like tired of this. Like I want to do something productive." So we started reading a little bit more and we've been going on walks with my kids. So I don't know if you know this but I have eight kids. But we have been yeah, yeah, yeah, yeah, not Amish or Mormon, just 8 kids.

Brett:

And so we do go on walks every night. Every night after dinner we go on a walk. Our neighbors that are about a half a mile from us, they have horses. One of those horses is pregnant, due any day so we've been going and checking on the horse. It's been a really interesting reset in a lot of ways. And so I think if you can take that mindset of saying, "Okay, we're here, whether I like it or not, we're here. So how do I hit the reset button?" I love getting out of the comparison game. Like that's such a dangerous trap to be in in a lot of cases. And how do I make myself better, get in the best shape of my life? Get my head right, be ready to really excel once things are turned back on.

Ryan Daniel Moran:

And I would say that now versus two months ago, there are still an equal number of things that are good and are bad.

Brett:

100%.

Ryan Daniel Moran:

It's just which ones you're looking at. The only thing that hasn't changed is the things that you were looking at as good have shifted and now they're somewhere else. And most of the world is just waiting for them to come back and Brett I don't think they're coming. I don't think a lot of them are coming back. I don't-

Brett:

Yeah. Yeah, there's going to be a new normal for sure.

Ryan Daniel Moran:

I think we just move forward in a different direction and that is not good or bad, it is just the way of the world.

Brett:

Yeah. Yeah. Really, really powerful. So let's talk specifically e-commerce. So you're an investor now, you built a company had an eight figure exit. You're now advising and you got on your back room and you're talking to smart entrepreneurs all the time. How has this pandemic, this event, how has it shifted your thinking towards the e-commerce, your outlook for e-commerce or has it shifted it?

Ryan Daniel Moran:

Yeah. So I mean from a big landscape point of view, I think what has happened is we're now officially going to digitize everything. Like all businesses that you used to go to the store to get, we're now proving that you don't have to. Now full disclosure, I love to go grocery shopping. Like right now, one of the projects I'm working on is a food company. It's a baking company. I love to browse the baking aisle and get new ideas. When I was in the supplement business, I used to love to look at the supplement lines. I love to go shopping. But we've proven that you don't have to go shopping anymore, right? I mean, Instacart is having its heyday right now. You might have delivery services that become fortune 500 companies.

Ryan Daniel Moran:

So we are now proving that you can digitize anything that you thought you couldn't in the past and that trend is going to continue. We're going to continue going down that path. I also love to go to Barnes & Noble. I have a feeling they're not going to exist after all of this plays out. So I think we are seeing an acceleration of what we've seen for the past five to 10 years, which is that big brands are giving way to small micro brands that address very specific problems for very specific groups of people. So you asked about my kind of view as an investor or as an advisor. I have someone right now who I'm coaching and we might get to the point where he talks about an investment, we'll see. But I just, I love this student's approach where she has this fairly small blog and her market is breastfeeding moms with kids that have skin issues.

Ryan Daniel Moran:

You couldn't get more micro than that, right? So her product is very specifically targeted to that group. And because of that, it's formulated specifically for that group. So whereas most people might look at that space and say, "That's a crowded space. The supplement space or the probiotic space, you can get a probiotic for nine bucks on Amazon." This is so specific to that market that she can charge three to five times the price of her competitors. And it'd be worth it because it's made to address a specific problem. But because she has an audience that is specific to that group, she can charge a higher price. She has a bigger moat in that audience and in that space and she has a more predictable launch plan for that.

Ryan Daniel Moran:

Those are the types of entrepreneurs that I love to back and those are the types of businesses that I think are going to succeed no matter what happens over the next one to three years in the economy or in the world. If you have a very specific audience that you can speak to and speak their language, I think we're going to be just fine and a lot of entrepreneurs are going to wake up to the fact, especially in the e-commerce world, that the game has to be more about speaking to customers and consumers rather than figuring out what the next thing is that you're going to sell.

Brett:

Interesting. I love that. And it's so interesting that e-commerce has been growing at about 15% globally, year over year for the last however many years forever. But I think this condensed window of a couple months has accelerated that growth big time. And people that were not used to getting their groceries delivered, ordering their groceries online, buying breastfeeding equipment online, like whatever the case may be or supplements, that they're doing that now like never before. And what's interesting, reading some articles about how people buy things in a recession and how to market in a recession.

Brett:

We just did a webinar about seven ways to market in a crisis. And one of the things that we found is that people are open to new things more in times of uncertainty or in a recession than at other times. Right now, even people that are not impacted financially, they're open to new things because they have to be. Like I can't just go to the store and get this thing that I always got. So I'm open to you. I'm open to you marketer or e-commerce company. Tell me your story. And so it really is an opportunity for us I think if we capture it and approach it the right way.

Ryan Daniel Moran:

Yeah. I think we're going to see more brands move into call it advertising on Facebook and Instagram because I think they're going to have to because they don't have shelf space anymore. But I think those big brands are going to struggle to communicate exactly to that target audience. . Right, right. And so I think we do have an advantage and an opportunity to move quickly right now. And if you can speak to a very specific target market, I think you are in just an absolute perfect time to be an e-commerce entrepreneur right now.

Brett:

Absolutely. Yeah. And just a quick thought on ads right now. We focus a lot on the Google ads ecosystem and Amazon ads, but Google ads are kind of on sale right now. Like YouTube, we're seeing YouTube costs 20 to 50% less depending on the audience and stuff right now, will last forever. Costs will continue to go up, like that's a certainty. But when you can combine the fact that hey as smaller e-commerce entrepreneurs, we know how to connect with people and ad costs are lower, now is a pretty good time.

Ryan Daniel Moran:

Yeah, it's amazing. And I'll throw into that influencers I think are on sale too. You have fewer brand sponsorships, you have fewer-

Brett:

And they've got time. What are they doing right now? Sure, send me your product, I'll create a video this evening.

Ryan Daniel Moran:

Right, right. And so man, I really do think you have to be a little bit scrappy right now, but I think that if you're willing to be scrappy and you just said something really important. You said it's fun though.

Brett:

It is. It is.

Ryan Daniel Moran:

Some people would disagree with you because a lot of ... we've had such a heyday in the e-commerce world that a lot of the entrepreneurs succeeded in businesses that they don't really like. They just were pursuing the money or the results. And that's fine. Like I mean I started my first business for the money too, but at some point that has a ceiling until you really like what you're doing or you like your customer. And we're in a very interesting window right now where you could make the pivot to rolling out a business that you enjoy a lot more than the thing that you're just doing for money and that opens up a new kind of gear for you to do the scrappy things to get ahead. Doing what you like is actually a really sweet unlock to growing something even bigger than what you're doing right now.

Brett:

Yeah, absolutely. And I think it's one of those things, I heard a quote from Stephen King years ago where he's like, "I love where I'm at." I'm paraphrasing here, but I miss the hungry days. Like I miss the days when I was like scrapping and trying to figure things out and fighting to get ... And most of us probably aren't at that point where we're like billionaire or whatever. But I think there's something to be said about when we have to shift gears and get into that scrappy mode and kind of get after a little bit. It should awaken something in you and that's for me anyway. I love what I do. I've always loved what I've done in this space, but scrapping is kind of fun.

Ryan Daniel Moran:

It is when you enjoy what is unfolding for you. So I was just playing with this thought earlier today Brett. This isn't fully flushed out, so you're getting the raw files. Forgive me. But I was thinking about how things like everything is about to be free. Go with me for a second. Like money right now, 0% interest rates, money's free.

Brett:

Or forgiven if you get the particular part of the cares act forgiven.

Ryan Daniel Moran:

Oil is free. Gasoline, cheapest in history. It's basically free. Air travel about to be the cheapest in history. Basically free. Anything that you want is about to be basically free so we don't have to do anything for money anymore. If you think about this, pretty much the whole world has opened up, prices are about to come crashing down. Starting a business Brett, basically free. You can kick start whatever you want, get pre orders, place the inventory order and fulfill. I mean like advertising this podcast, free. Almost everything that you want is actually can be done free. So you might as well just do what you want because the whole world is getting to the point. And I don't mean to be crass, I know there's ... I think there's more mental financial stress than there is actual financial stress. Like people worry about what's going to happen while they are eating a full meal on their cell phone. And I get, like I've been there, right? When the stock market fell from 30,000 to 18,000, I had those moments of fear of what am I going to do? I need to make more money.

Brett:

All going away. Yup.

Ryan Daniel Moran:

I had it too and I got lots of money. So I understand like the mental game that happens. And I don't mean to be crass, I just mean that anything that you really want to do, you can basically do for less than it has ever cost in real dollars in history and that trend is continuing. We have more abundance than ever before. So you might as well just do what you want because we just got to the point where like we've all kind of won. If you're safe and you're healthy and you don't have to go anywhere in quarantine, this is a really good time to dream. It's a really good time to be like, what do I want? Because like when life moves forward, we can do anything. And prices are going to be cheap and there's going to be lots of mobility and we can do whatever we want. So we might as well just build businesses that we like and that we get really jizzer jazzered up about.

Brett:

Yeah. And I love that you're saying it's free. I think that that adds some drama too and it opens up your eyes a little bit. I think another way to frame it as like, it's accessible, right? You can get these things, gas, air travel, business, like it's accessible and potentially getting there is easier than it's ever been before, which is really cool. So awesome. I want to kind of paint two different scenarios and I want to pick the brain of Ryan and see what you would advise for an e-commerce company in these two scenarios. And your advice may be almost identical for both. If it is, it's fine. So really seeing two groups of e-commerce companies.

Brett:

The majority of the e-commerce companies we work with and talk to are actually doing quite well right now. Yeah. In fact, so we built these, a member of my team built these COVID-19 dashboards where I can quickly go in and look at all of our clients day over day, week over week, month over month and year over year, global sales, sales from Google ads, things like that and then kind of do a comparison. At the beginning, like one weekend to this, we still had 67% of our clients were up at least year over year and month over month. Okay.

Ryan Daniel Moran:

Amazing.

Brett:

I just looked this morning, so I went through all accounts. We serve about 80 accounts. 75% are up right now.

Ryan Daniel Moran:

That's great.

Brett:

And like another 5% are flat. There's a few that are like plus or minus 2%. There are some that are down though. And I'll talk to you about the categories we're seeing that are down. This may or may not be global to back this up. But apparel is down in some cases, like accessories, watches, things like that are down a little bit. We're seeing some luxury items. I have a client that sells luxury bedding, like really high end bedding although they just had a major turner. Like they got hit hard at the beginning of this, but the last April's been great.

Brett:

Anyway, so let's first take an e-commerce company that's kind of had a rough go of it. Like they're not doing so well in this COVID-19 world and maybe they're hearing from their friends or I think that the CEO of Shopify just said it's like Christmas everyday right now. And this entrepreneur is saying, "Well not for me. Like I'm not there." So what advice would you give to the struggling e-commerce brand? What should they be thinking about doing now? And then also what should they be doing as we come out of this and whatever the new normal looks like?

Ryan Daniel Moran:

So this is going to be a little bit counterintuitive. If you are not performing the way that you would like to be performing, I'd be willing to bet money, nine bucks I'll bet that you are thinking too big. Now that's counterintuitive because most people say you need to think bigger. You need to go harder, you need to move faster. I think you are overlooking all of your opportunities because you're comparing yourself to the people that you perceive to be doing bigger things. It does not take a lot of people to build a really wildly successful profitable business. You do not need a million customers to do damage. You need a few people who really give a crap.

Ryan Daniel Moran:

So the way that you can pivot from stagnant growth or from a reduction in sales to growth again is to go all in on the people who are giving a crap and go get more of them. What most people do is they ignore all of the good news that they're getting from their customers and they look for the problems and so they find more of them. And so they up being in this endless loop of trying to fix things that are broken rather than serving and going and get more people that they want to serve. So if you go after the people that are really happy, after the people who need exactly what you've got, and you communicate them in a way that they're used to being communicated to, you'll have a new audience in 90 days.

Ryan Daniel Moran:

So a lot of people and I've experienced this myself where you kind of overlook the hundred people that are showing up because you see somebody else has a thousand or a million. But if you just go all in on those hundred, like I tell people when they're launching a new business, if you can get a hundred people, a hundred people really excited to the point where they will post about you on social media and they will review your product on Amazon and they'll go on auto ship on your Shopify store and they'll subscribe on YouTube and share your videos. 100 of those people who care, you can build a six or seven figure business with those hundred people. And so I think that the entrepreneur is thinking beyond where they are and they're beating themselves up for where they're not rather than maximizing where they are. But that's the route that they have to go through if they want to get back to growth.

Brett:

Yeah, I love that. And one of the other things we're seeing, talking about maybe you're thinking too big or you're thinking beyond what you need to focus on. Sometimes we think, hey, I need some kind of complex funnel or I need some kind of new whizzbang thing when really maybe what you need to do is just put up some solid Google search ads or some shopping ads. Like get some of those now buyers, put out great content like you're talking about, connect with people, like do some really simple things. Very simple things right now are having a pretty high return.

Ryan Daniel Moran:

Yeah. I mean, the way I like to look at it is just celebrate and highlight whatever you want more of. So if somebody leaves you a five star review on Amazon, screenshot that, post it on social media, responded to them publicly, and then send them a gift basket and watch them respond publicly to you and watch how many other people are like, "Well shoot, they're doing that for a five star review. I'll feel kind of bad that I haven't reviewed this guy." Or if you just email your list and say thank you. I haven't reached out in a while and we're a small business. I just want to say thank you. I know there's a lot of people that could have your attention and you gave five minutes of it to us and I just appreciate it. Thank you. The more you appreciate what you want more of, it appreciates. You get more of it. So turn your attention away from where you are not and put it towards what you want more of and you will get more of it.

Brett:

Yeah, that's awesome. Super powerful. So, okay. Let's flip it now. So let's look at ... and I don't know what the global numbers are, but for our client base, 75% are up right now. Like maybe they even feel bad that they're ... There's the news that people are being laid off and the restaurant industry is being decimated and things like that and they're like, "Whoa, I just have like a record month." So what about the e-commerce brand is doing really well right now? Any advice, any things you'd tell them, "Hey, don't get loads of sleep here," or just any words of advice for those that are doing well right now?

Ryan Daniel Moran:

For the brand that is doing really well, don't overlook the people that are making it possible for you to do really well. So you're doing something well, great. Keep doing it and double down on your appreciation for your customers. Double down on your appreciation for your best team members because I'm trying to see how to word this. We're all a little bit on eggshells because we're all a little bit ... we can all be sucker punched right now. So you'd better be extra thankful for the people who are spending the most money with you and the people who are most contributing to your success. And they should be more appreciative to you too. We're all having to step up a little bit more. So don't get soft on the people that are making it possible for you to be continuing to kill it.

Brett:

I love that advice. I actually just did an interview with a guy named David Wax and he's got a service to help you create handwritten notes. And it was just such a ... it was interesting to me because I've been kind of a marketing junkie since the early two thousands and I was a Jay Abraham fan and Dan Kennedy's fan and like looked at hand addressed mail and lumpy mail and things like that. But hearing him talk and then actually a friend of mine owns a jewelry store and I've helped them with their marketing for over a decade now. I bought something recently and he sent me a handwritten note and it had a couple of lines in it. And this is something I was just reminded, they do this with everybody. Everybody.

Brett:

They'll send a handwritten note, it'll have like a couple little nuggets in there. It's not just like, hey, thanks for purchasing. I really appreciate it, blah blah blah. It's like, hey, I really hope Britney enjoyed this because she made this comment. Like there's something personal in it, but that if I didn't already love the guy and love the company, I would now. I think there's some pieces of that that e-commerce companies could do too. Why not take an hour a day in the evening now when you're in lockdown and write a handwritten thank you note to some of your best customers and make it personal and put some meaning in it. I think that would be a huge, probably a huge return on time. So yeah, I love that.

Ryan Daniel Moran:

Yeah. I think too many people try to scale before they do the grunt work at the beginning and that allows them to scale. Or said differently, I think too many people are worried about growth rather than they are about those beginning stages when they're kind of setting the landscape. And when you're at the ... especially at the beginning, going all in on the people who actually care just completely changes the trajectory of your business. I mean this is a reason why people say that your network is your net worth. It's because the people that are surrounded, those are all ... that surround you, those are your opportunities. And it takes one person to have the right audience or the right investor or the right connection or the right idea that changes everything. But people are so focused on what they're going to get out of the transaction that they ignore the kind of stuff you're talking about ..

Brett:

Love it. So I love that you've kind of transitioned to you're an investor, you're an advisor, you're doing all kinds of fun things right now. It's always interesting to hear from an advisor or an investor's perspective, what do you look for in an e-commerce company? So if you're going to invest your money or your funds money into an e-commerce store, what are you looking for? And the reason I asked that is because I think there are some clues there even for somebody that doesn't want to sell. Like someone that just wants to keep their business, they don't want investors, whatever. There's a lesson there on here's what makes for a real business. Here's what makes a successful business. So what do you look for?

Ryan Daniel Moran:

Yeah, there's two things right off the bat. The first is I am looking at the mindset of the entrepreneur. The number one, no question. You are betting on the jockey. You are betting on the person when you make an investment 100% because we have all had great ideas that sucked. We've all had them. And so you are betting on the person who is leading the ship and I am evaluating how excited are they about the process? How excited are they to build the product line? How excited are they about the mission and the story? I am not looking at projections. I am not looking at market size. I am not looking at the entrepreneurs saying how much money they're going to make. That's a turn off to me. Not because I don't like money. My company is capitalism.com I really like money. I am looking at it because the most profitable bet is on the person who is going to be operating in the service of other people. So that's the first thing I'm looking for. The next thing I'm looking for, number two, the best marketing in the world is a great fricking product.

Brett:

It's so true. It's so true. invested in marketing for years. Yeah.

Ryan Daniel Moran:

You said like you kind of quipped that somebody thinks I need like a great complex funnel and no you don't. Most billion dollar companies don't have complex funnels. They have great fricking products. And so I'm looking at what does the customer say about the buying experience and the product? What does the market say they want? How are people coming back and buying more of it? So ideas are crap. The person who is in charge and the excitedness of the customer, those are the things that matter right off the bat. If those two things pass, then we can talk business.

Brett:

Nice. Yeah, I like that. So you're looking for, does this entrepreneur have the passion, which that's maybe an overused or poorly used word, but do they love this, do they have resilience or do they have tenacity. I love your interview recently that you did on your podcast with Moiz Ali, the founder of Native Deodorant. And he talks about this too. And actually, he's got a new podcast coming out, which I don't remember the name of, but I'll link to it-

Ryan Daniel Moran:

Called Exit Strategy.

Brett:

Exit Strategy. Yeah. So Moiz, mutual friend. We actually, a client of ours as well, full disclosure. But I love their product. But Moiz like embodies and he even says like you don't have to do it the way he did it of course, but he embodies like this amazing resilient entrepreneur. So you're looking for that but is there-

Ryan Daniel Moran:

But just to piggyback on that Brett, Moiz is chapter four in my new book.

Brett:

Is that right? Okay.

Ryan Daniel Moran:

And so I open with the story of Moiz taking a stick of Native Deodorant and rubbing it on his shirt because he was in iteration mode on his product of how do we make this better? How do we make this better? How do we make this better? And that's the type of entrepreneur that has a shot. Most people, and this is, I get taken to the cleaners in the Amazon circles because people ask me like, "When you're browsing for a product on helium 10 in Jungle Scout, what do you look at?" I'm like, "I don't use it any data to tell me what product my customers want. I can look at it from market size and those tools can be really helpful for making final decisions."

Ryan Daniel Moran:

But so to try and decide what business you're going to be in based on market data is usually a sign that somebody is in it to extract money from the market rather than to create something that is unique and different for a specific group of people. One of those is a lifestyle business that you can manage and be fine, be a full time entrepreneur and worry about money a lot. The other is to be a brand that can be scaled and sold. And I like to bet on entrepreneurs who are willing to build brands.

Brett:

Awesome. And just to kind of fill out that story a little bit so that you'll go buy the book. And so you'll listen to Moiz's podcast. Started Native Deodorant in his kitchen, within two years time, was it right about two years sold to P&G for $120 million?

Ryan Daniel Moran:

He started with $500 and 18 months later he had an offer on the table.

Brett:

Insane. It's insane. So check out his podcast, check out Ryan's book and get more of the scoop. So now let me ask you this, because I love where you're coming from. I love the mindset of like you got a bet on the jockey, you have to understand the entrepreneur. But I also like data and I get the sense of you like data too because you've been very successful. Are there any data points you look at that tell you this is a successful entrepreneur. They have what it takes to be successful or is this more gut, more perception? How do you evaluate that?

Ryan Daniel Moran:

Are you talking about in the context of investing in someone?

Brett:

Yes.

Ryan Daniel Moran:

Well one of the pieces of data that I'm looking at is like in the investment world we would call it return on invested capital, but it's not that fancy sounding when I'm actually looking at it. Because I'm more looking at it as is this person a good steward of the money that I'm about to give them? And have they proven that by being willing to spend a dollar and make a dollar back and consider it a win? So I'm looking at how aggressively they can acquire and are willing to acquire customers. So that's a data point that I'll look at. Is somebody willing to make the YouTube video, to run the YouTube ad, to spend in the red in the shorter term on Amazon, to go spend the money to build the audience, to create the relationships with influencers and advisors? Or are they holding onto it with this mindset of it's 100% pie. I'm going to keep as much of the pie as possible, and that's my baby.

Ryan Daniel Moran:

I run from those entrepreneurs. I run from them. And it's because if you don't believe that an outside relationship is going to make the pie bigger, then you don't get how capitalism works. Capitalism works by you and me coming together and creating new value that did not exist before. But most entrepreneurs are instead looking at it as there's this fixed pie and I'm going to carve out a little slice and I'm going to hold onto as much of it as possible. That's an entrepreneur who was going to plateau and I can't invest in that person. So if you're willing to make the pie bigger by showing that you're willing to acquire customers, even going to the red to acquire customers because you're so confident that your business has the runway to be able to make up for the loss in the longterm. If you haven't proven that, then I'm not sure you're ready to take on my money.

Brett:

Yeah. Growth mindset versus a scarcity mindset in a lot of ways that if I'm giving you something, then I lose it rather than we can all win.

Ryan Daniel Moran:

That's right.

Brett:

Totally makes sense. We'd love to get your perspective on this because this has been another interesting thing for me. Right? So we've made some good decisions I think with OMG Commerce and we've made some dumb decisions too. But I've been thinking about like, what do I invest in? What do I do right now? Because it was such a flip in mindset for me several years ago when I heard Mayford Garrett Gunderson who was on your podcast. I also heard Gary Vee and a few other people talking about, well now we're just waiting for the next recession because that's when there's going to be opportunities. That's when things are going to go on sale. There's going to be discounts. We're going to invest. A lot of money was made in the great depression as an example. So it was a difficult time obviously. I was not alive then. My kids like to make jokes. Like I was on that battle although I'm 40 years old. But so lots of opportunities here.

Brett:

I think though, going back to some points I made in the beginning, there could be some people that are saying like, I don't know what to do. Like do I go buy stocks now, do I invest in this company now? There's this fear of maybe I'm going to miss a golden opportunity in the midst of this. So how are you approaching investing right now? What advice would you give to the investor who's kind of sitting on the sidelines right now trying to wonder what the-

Ryan Daniel Moran:

Yeah. So I mean full disclosure, I'm an idiot on the internet who just enjoys talking about this stuff. So don't listen to anything that I say.

Brett:

This is not investment advice. Just don't give investment advice.

Ryan Daniel Moran:

Just don't listen to anything that I say. I'm an idiot on the internet. That's the disclaimer. And I'm like, I covered everything. I'm a moron. And my last name is Moran. All right. Don't listen to anything that I have to say. But in terms of investing, if you listen to the smartest investors in the world, there's one thing that all of them say consistently, invest in what you understand. It is the same thing in business. Do not start a business that you do not have a strategic advantage in. Do not start a business that you don't know something more than the other person. Do not start a business where you don't know more about your customer, more about the marketplace or at least believe in something so much that you're willing to put your blood, sweat and tears into it. Do not do that. And the same is true in investing. In investing, invest in the companies that you know something about because that is how marketplaces price things.

Ryan Daniel Moran:

So the price is not like some illusory thing that is outside of people. It's people's perception. And so if you know something early on like how many of us were shopping on Amazon before the rest of the world? Most of us. How many people were using Zoom before the rest of the world? Most of us. How many people are buying Bitcoin knowing that there is no utility to it right now? A lot of people, and those are speculators who are hoping that it's going to go up in value. Now you get a pass if you're actually buying things in Bitcoin and you can see where it's being utilized. But that is like 1%.

Brett:

Yeah, it's like I don't think I know anybody that's doing that but it's like maybe.

Ryan Daniel Moran:

So there's no utility there. So the only reason you would buy it is because you think it's going to go up in value. And that is how most people are approaching stocks and investing. I hope this goes up in value. In reality, you're looking at companies and sectors that you know something about and you can make like a voluntary bet on it doing well versus trying to just price time things and buy low and hope that it goes up. I don't think-

Brett:

Catch the falling knife so to speak, like it's impossible to time the market. The smartest people in the world can't do it.

Ryan Daniel Moran:

I mean now to my own credit, I came out publicly to my list and I said, "Look, the dollar is probably going to break down to 22,000, then 20,000, then 18,000. Well bounce from 18,000, go back up to 24 and then we're going to go right back down to 20." And that has like happened almost exactly. So like from a marketplace perspective, like we nailed it at capitalism.com. However, the strategy with how you respond to that doesn't change that much. It's by good companies that you believe in at good prices. And the only thing that-

Brett:

That you understand when there's a value there. You understand when it's on sale.

Ryan Daniel Moran:

Correct. So the only thing that knowing what the market will do or might do, the only that's going to tell you is how the broad market is responding to all of the news. It should not affect your decision to evaluate a good company. The only way that you can respond, even when the market goes from 30,000 to 20,000, the only proper way to respond is getting out ahead of that. Knowing what your shopping list of businesses are before there is a big event because otherwise you have no way to properly price that business. So we're getting into like mumbo jumbo here. Here's a real takeaway. The business you know most about is your own. And so your dollars are best deployed in your own business. I recommend not ... sorry, I shouldn't say recommend in the context of investing.

Ryan Daniel Moran:

I take 10% of take home money and put that into the market. And I put that into companies that I like, that pay a dividend or that I know a lot about, and that's my longterm investment strategy. Everything else goes into companies I know really well, which usually come from my own network and or that I own a piece of. That to me is the smartest thing that you can do.

Brett:

Nice.

Ryan Daniel Moran:

And actually, let's just look at this conversation we've had. We've talked about YouTube ads are on sale right now. Influencers are on sale right now. Guess what Brett, that's investing.

Brett:

It is investing. It is. Investing-

Ryan Daniel Moran:

By underpricing assets and reselling stuff. That's investing and guess what? We have a strategic advantage knowing that that's the case. That's where we should put our dollars. And you know what might happen next is that Google might report lower revenue because prices are down and then we'll go, "That's not going to last. Maybe it's time to buy Google."

Brett:

Yeah. Buy some google stock.

Ryan Daniel Moran:

That's smart investing. Not is the market going to go up or is going to go down? That's a fool's game.

Brett:

Yeah, I got this stock tip from my neighbor. He said this is a can't lose stock over here. But I love that. I think that's something that a lot of people aren't thinking about is you know your business, you know traffic, you know whatever, like invest in it when it's on sale. Like that's, if YouTube ads are down in cost 20 to 50%, and you know what you're doing, you have a good offer and a good ad and all that, you just made 20% on your money, like what you would have had otherwise. Right. That's a pretty good-

Ryan Daniel Moran:

Yeah, and that's a good ROI.

Brett:

That's good ROI. Yeah. Even if nothing else changes, that's pretty good ROI.

Ryan Daniel Moran:

That's right.

Brett:

That's fantastic. Let's talk a little bit about the stuff you got going on and how people can kind of get involved. So first of all, let's talk about the capitalism conference. Why did you do that? And is there any, and I don't mean to put you on the spot, but is there plans on that's going to happen at some point in the future? Any ideas when?

Ryan Daniel Moran:

Yeah, so it's so funny you should ask Brett. So you asked about the story of the capitalism conference. It's kind of an embarrassing story. A few years ago I used to fall asleep to this thought. This was like I think I had just moved to Austin. So like 2013 I used to have this thought. I used to ask myself, what's the biggest strategic risk I could take right now that if it paid off would change my life? And that was how I would approach business when I was like in my mid 20s.

Brett:

That's a bold thought, man. Yeah.

Ryan Daniel Moran:

And so I ran the numbers on an event and I discovered that it would basically require most, if not all of my retained earnings that I had up until that point. And so I said, "Okay, it'll cost that much, but I'll sell tickets. I know I'll sell some. So if I can sell some, I can offset the cost so it won't be a total loss." So I had about half a million dollars in retained earnings and I bet them, and my thought was-

Brett:

This is also probably not investment advice.

Ryan Daniel Moran:

This is not investment advice.

Brett:

Don't put all your money in a new event you're creating. But yeah.

Ryan Daniel Moran:

Probably not especially right now Brett. But the thought to me was, you know what? I don't feel like I'm on the path that is going to bring me the most growth and fulfillment. So the only way I know how to hack that is to surround myself with people who are on the path that I want to be on. And so I booked right out of the gate. I paid them their crazy speaking fees. Gary Vaynerchuk, Grant Cardone-

Brett:

Dude, that's paid off because you and Gary Vee like hanging out. So I mean like that's become a relationship. Yeah.

Ryan Daniel Moran:

He wrote the endorsement on the top of my book that I'm very proud of.

Brett:

That's awesome.

Ryan Daniel Moran:

Grant Cardone ended up being a great story because I thought he was a real d bag and Robert Herjavec was-

Brett:

I think there may be a decent number of people that think that. Yeah.

Ryan Daniel Moran:

Oh, I've got stories Brett. But basically what happened was I basically put half a million dollars into building my network. And I was like, and I'll sell tickets and we'll see who shows up. That was the first cap con back in like 2014 or 15. And this year obviously didn't happen and we'll bring it back. We'll have cap con five. I don't know when that will be, but what we just announced, we just announced, I do a membership called the 1%. We just announced that cap con is basically going to be rolled into membership. So our members, all of their membership dues are just going to be credits for cap con and cap con's going to end up being our Superbowl. So I'm really excited about it. I don't know when it's going to happen. But we're really pumped about it.

Brett:

Cool. All links to everything is capitalism.com. Check it out and then you can be informed then when that does go live. Let's talk a little bit about the 1% and what you guys are doing there and who might be a good fit for that. And then I want to talk about your book.

Ryan Daniel Moran:

Okay, cool. I mean, you know what's funny is this is me really letting my hair down with you Brett. I'm just going to hanging out for a second.

Brett:

All right. I like it.

Ryan Daniel Moran:

Have you ever noticed in your business that the things that are really hard and that you think are going to be amazing don't work out as highly as like the things that are really easy and you're like, "That's too easy. That's not going to work."

Brett:

Yup. Yup.

Ryan Daniel Moran:

I just had this with the 1% where like we have, we put all our trainings in there, like tens of thousands of dollars worth of training and you want to make the most amazing can't say no offer except for the fact that no one wants more training. And then just recently we started doing this thing, we just call it like Sunday Capitalism Coffee. Like we all get together and we get on a, like we do a live and we just like somebody has an ask of the community, we bring them on live and they're like, "Look I'm really struggling with this piece. Does anybody know an investor?" And then the whole group will come in and comment and open their network. Right. And so it's just like a Sunday coffee mastermind. Was just something that I threw together because I wanted to just hang out more with my community. Huge success.

Brett:

Takes no preparation, takes no, you're not yet creating courses or anything.

Ryan Daniel Moran:

Exactly. Right. So it's a community of capitalists and I mean really our bread and butter is build a business and invest the profits. That's the content we create. Those are the courses that we put in there. That's who we surround ourselves with at the event. And it's all rolled into our membership called the 1%. So it's funny because it's kind of been ... You asked me right now where we're kind of in transition of like all the stuff that we thought was going to be so hard and so valuable are the things no one pays attention to. And the things that are so easy, like creating, for me anyway, creating community for entrepreneurs and serving one another and opening our network for one another and investing in one another. And there was somebody who was like, "Hey, this is my idea. What do you think of it?" And other people were commenting like, I want one, I want one. I'll pre order. And so it's a community for capitalists and it's a community that opens up its network and its resources to help people build businesses and invest the profits.

Brett:

Yup. That's fantastic. And one thing I will say, you have a skillset for building community. Like you're naturally good at that. You're good with people, you communicate well, you're perceptive, like obviously so that plays into it. But I think the concept you just shared is true with everybody. Like the thing, probably the thing that comes the most natural and the easiest to you may also lead to the biggest wins in some cases.

Ryan Daniel Moran:

Yeah. And it's taken me 32 years to learn that, that we're all unique in some way and our uniqueness is our greatest value. Now, one of the hard things for entrepreneurs, especially internet entrepreneurs at least in my experience has been that we perceive other people's big wins as the thing that we need to mimic in order to have success. But the thing that stands out to me is like my favorite baseball player of all time is named Kenny Lofton. My biggest hall of fame snub in history, like he should-

Brett:

Is that because he played for the Indians or are you just, you're just a fan?

Ryan Daniel Moran:

Well, he was an electrifying player.

Brett:

I've heard the name, I'm not a huge baseball guy, but I've heard the name.

Ryan Daniel Moran:

People might argue like the question is legitimate of am I an Indians fan because of Kenny Lofton or am I a Kenny Lofton fan because of the Indians? An electrifying player. Right. And he was a speedster and a defender and he hit a lot of singles. Well at the same time there was a player on the team named Albert Bell, biggest power hitter of the era-

Brett:

Yeah. Yeah. Know that name.

Ryan Daniel Moran:

Had Kenny Lofton tried to be a power hitter like Albert Bell, he would've sucked. And yet in like the entrepreneurial world, there's a lot of Kenny Loftons who are trying to be Albert Bells. They're building businesses mimicking everybody else's funnel, everyone else's ads, everyone else's advertising strategy, everyone else's product. And the fact of the matter is you're trying to mimic someone else's game and they've already got it. And so it's taken me 32 years I think to really realize that what is naturally easily and motivating and exciting and fun for me is my greatest gift to the people around me. Do you have any idea how much fun I've had in the last hour? I will walk out of this interview with more energy than when I started. I am so proud of the book I wrote because it's me just bleeding on the paper and analyzing every word and loving every minute of it.

Ryan Daniel Moran:

And so it's going to be really easy for me to sell it because I'm going to look someone in the face and be like, "You want to start a business? If you want to hit $1 million, this is the book. Go read it. It's the best thing you ..." And I will have no conflict of like should they really do it? It's like, no, go read the book. You're an idiot if you don't read the book. And I've had the experience in the past where I've had products that I didn't feel that way about. And guess what happens? You overthink the copy and you analyze every little thing and it takes you forever to build that funnel. Whereas if you just did what was naturally easily motivating to you, the whole world would open up to you. So this is the lesson I'm learning in my career right now Brett.

Brett:

I love it. So one final thought and then I want to get into the book and the details there. I think there's something, there's this interesting balance and this challenge of saying, "Hey, I'm going to look at the Albert Bells or I'm going to look at these successful entrepreneurs. I'm going to look at the Ryan Daniel Morans of the world and say, 'Okay, there are clues in their success, right? Success leaves clues. So I want to learn from those clues, but I can't become Ryan. I'm not Ryan. I've got to be me. Right? So I've got to be Kenny Lofton not Albert Bell.'" Any tips or tricks there or is it just a matter of getting that mind right?

Ryan Daniel Moran:

Yes. Your emotions are the guide to that. That sounds woo-woo airy fairy weirdo at first, but hear me out. Your emotions are a really good sign of what you really want. Does it excite you or does it make you contract? So like we're all really driven by our emotions. Mark Manson wrote the book, Everything Is F'd and he also wrote The Subtle Art. But I really liked his follow up book, which is called Everything Is F'd. And in it he talks about the thinking brain and the feeling brain and how they're both in the car but the feeling brain is the one with its hands on the wheel. And the thinking brain is navigating saying, I think we should go this way. But the thinking brain cannot make the hands on the wheel move in a different direction. The thinking brain is subservient to the feeling brain.

Ryan Daniel Moran:

Now we all, especially in the West, prioritize the thinking brain because it's rational and it's reasonable, but it ain't driving the car. We cannot out-think our emotions. Our emotions have their hand on the wheel. And it is deciding where it's going, when it's hungry, when it's angry, when it wants something, it finds ways to get it. And the thinking brain has to sit there and go, okay, I got to find a new map. And so our emotions, when we're happy, when we're excited, when we're relaxed, when we feel loving, when we feel giving, when we feel energized, when we feel at ease, when we feel playful, when we feel excited, those are all in line with the things that we want. We feel those ways because we're thinking about and practicing the things that we really want.

Ryan Daniel Moran:

And when we're not giving the feeling brain what we really want, when we're stressed, when we're thinking about money, when we're trying to predict the future, when we're thinking about strategy in a way that gets the results, not the way that makes us excited, we are now robbing our emotions of what they really want. So the way that really unlock your superpower is to pay attention to the way things make you feel rather than the strategy that is going to get you there. Man, I had to beat my head against the wall enough times to finally realize that the wall wasn't moving. I was just going to walk around it and it's led me to this conclusion. I am not smarter than my emotions.

Ryan Daniel Moran:

So I do stupid things when my emotions are out of whack. And so if I'm good with my emotions, then I'm really a clear thinker and I really get a lot of good things done. But when I'm afraid, when I am nervous, when I feel out of integrity, man I cannot think my way to success. And so finding out who we really are and what really drives us is a matter of tuning into our emotional abilities, not our mental IQ.

Brett:

Dude, that's good. That's really good. I'm going to check that book out. Deep stuff. But now let's talk about your book. So let me tell me why I would be an idiot not to buy your book, which I believe that I would be.

Ryan Daniel Moran:

Because it is the playbook to building a business to seven figures in a way that is scalable and sellable, in a way to do it with minimal startup capital, almost no risk, and in a way that is predictable and has been proven over hundreds and hundreds of entrepreneurs with case studies that make it fun enough for you to breeze through it. So in my career-

Brett:

And I'm assuming your writing style is like your speaking style, because this is like, this is very digestible, entertaining, fun, high energy. So do you write in similar fashion?

Ryan Daniel Moran:

Yeah, my editor took out some of the curse words but yes. So-

Brett:

Yeah, you want to ... for those that are watching the video, you want to.

Ryan Daniel Moran:

Yeah, yeah, yeah. So this is 12 months To 1 million, quote by Gary Vaynerchuk up top, foreword by Russell Brunson.

Brett:

Russell Brunson. Yeah. Which I was actually thinking of Russell Brunson's a friend. We actually did a project together in 2009 called DCS local. I felt this need to like shout out to Russell. I know we were talking negatively about complex funnels. Click funnels is still great. Russell Brunson is still great. You still may be one funnel away from something. Anyway, guys I'm just throwing that out there.

Ryan Daniel Moran:

I use click funnels too. So my strategy at capitalism.com has been very simply to help entrepreneurs align those four products that sales 25 sales a day to get to a hundred sales. At a $30 price point, that's $1 million business. So this is kind of the fast lane to getting those four products to 25 sales a day and having $1 million business. It's broken into three stages. Stage one is the grind. The grind is discovering who your target market is, what they buy, deciding what your first product is going to be, coming up with a launch plan, funding the business, those hard decisions that we need to get out of the way as quickly as possible so we can take a darn sale. Stage two I call the growth. It is about getting that product to 25 sales a day and here's how we do it. We do that by stacking the deck and stacking the deck is building up a small seed audience that wants what we've got ready on launch day.

Ryan Daniel Moran:

And then going all in on our customers, our reviewers, and the people who are watching our stuff until we're at 25 sales a day. Screenshotting every review, replying to every comment until we're doing the consistent 25 sales a day. Then stage three is called the gold. It's when we repeat that process over three more products. And so we have four products doing 25 sales a day. That's a hundred sales a day. Now, the caveat to this is once you're in stage three, things compound way faster. In my experience, when you launch that second product off the back of something doing 25 sales a day, the first product will also go way up because you have repeat sellers, you have crossover sales, you have upsells, you have word of mouth, you have subscribe and save, you have people on auto ship.

Ryan Daniel Moran:

And so the snowball starts to build. So if you're a new entrepreneur on a new journey, this is going to give you clarity and a roadmap to hitting seven figures. If you are already in business, this is a book that is going to help you build a sustainable business that you can scale and sell. So I know there's a lot of entrepreneurs who are wondering, how do I ... like I've got something that's working but I don't feel like I have something that I can scale and sell. The problem is probably that you don't know who your who is. You're not going all in on that person and you are not doing the things that allow that business to sustain it without you working all the time. So if you're working too much and you don't have a business that you can sell or you want to be more sellable, this is the book that'll give you a seven figure business you can sell.

Brett:

That's awesome. And I'm a firm believer, I know you are too that really the companies that will succeed and win in the coming years are those that build a brand, those that are focused on the customer, those that build a great product. And I'm super excited. I can't wait to dig into the book. So check it out. 12 months To 1 million, also capitalism.com. Go there, check out Ryan's podcast, come to the next event whenever that may be. Ryan, this has been a blast man. I've had so much fun getting to chat with you.

Ryan Daniel Moran:

I had a great time too. Thank you man.

Brett:

Yeah, yeah, I had a lot of fun. Any asks? Anything you want to ask from the audience?

Ryan Daniel Moran:

Well, since you said you asked, I was recording a solo podcast earlier today and I just decided to do like I on the spot while I was recording, I was like, "Hey, here's an idea," and just dropped it on my podcast. So I'm just testing this. I have over at capitalism.com/book, I put together bulk order options for the book. And the one that I put together was the top tier was to fly to Austin and we'll come up with a strategic plan to build a seven figure business for you in a day. And then I'll open up my network to help promote the business and I'll even consider investing in the business. So that's at capitalism.com/book.

Brett:

Quarantine's getting to you man.

Ryan Daniel Moran:

Yeah, I guess so. So my ask is if you have an audience or if you've been just kicking around the idea of doing this for too long or if you've got a podcast and want to do something cool by your audience, I just decided to put together one of the tiers being that you can come to Austin or we can do it on Zoom if quarantine goes on for the rest of the year and we'll map out the strategic plan to build a seven figure business for you, custom tailored and then I'll consider it opening my network or even my wallet to back the business. So that was the most no brainer offer I could think of to promote.

Brett:

That is super fun. So check it out at capitalism.com/book. Ryan Daniel Moran ladies and gentlemen. Ryan, thanks again man. Would love to do it again some time.

Ryan Daniel Moran:

Yeah, thank you so much for having me. It was great chatting with you all. Thank you.

Brett:

Absolutely. And as always, we appreciate you. We'd love to hear more of what you'd like us to dive into on this podcast. So give us some feedback. Give us a review on iTunes if you're so inclined. And with that, until next time, thank you for listening.

‍

Episode 116

:

Chris Brewer - OMG Commerce

7 Ways to Market in Times of Uncertainty

In this episode, Chris Brewer, Co-Founder of OMG Commerce, and I dive into some important topics.

Currently, over 77% of our eCommerce clients are either still UP in sales even during this time of extreme uncertainty or are the same (plus or minus 1-2%). Yes, some are hurting - but for most eCommerce businesses you CAN do something about sluggish sales right now. We’ve learned a lot in recent weeks on what messages resonate with prospects and what falls flat. In this episode (taken from a recent highly-popular webinar) Chris Brewer, Co-Founder of OMG Commerce and I dive into these important topics:

Understanding the different physiological segments of shoppers right now and how to appeal to them
People still want to buy even when stuck at home - how to provide retail therapy to your customers
How to handle paid search on both Amazon and Google right now (search trends are shifting)
Why this could be the perfect time to consider YouTube ads…viewership is up 100%+ on the platform and ad costs are down 20% or more
How you can gain market share and get ahead of the competition right now

‍

Brett Curry - CEO of OMG Commerce

Chris Brewer - Digital & eCommerce Entrepreneur and Co-Founder of OMG Commerce

OMG Commerce Guides

Mentioned in this episode:

The Ultimate Guide to Google Shopping - OMG Commerce

eCommerce Evolution Podcast with Liz Germain

How to Market in a Downturn - Harvard Business Review

Huckberry

Big Blanket Co.

BOOM by Cindy Joseph

Amazon DSP‍

YouTube TrueView

Episode Transcript

Brett:

Well hello and welcome to another edition of the eCommerce Evolution Podcast. I'm your host, Brett Curry. CEO of OMG Commerce. Today's episode is a little bit different. This is actually the recording from a recent webinar that my business partner Chris Brewer and I hosted. And this webinar is all about seven ways to market in times of uncertainty. So with lockdowns in effect, and some of those will be expiring before too long at the time of this recording, but with all of the shift in consumer behavior and potential shift in consumer confidence, how should we be approaching our marketing right now? I think you'll find this content helpful because we look at this from both the strategic side, understanding kind of the psychology of shoppers right now and some new psychological segments to consider in the marketplace, but then we also get very tactical and talk about Google ads and YouTube ads and Amazon ads and even shifting your message during this time. So I hope you find this timely and helpful. Let's dive into Seven Ways to Market in a Crisis.

Brett:

I want to welcome everybody to the webinar. Really excited you could take the time, you decided to take the time to join us. We're digging into a super important topic. This is something that we're all thinking about, we're all facing right now. How do we grow our business? How do we maintain our business? How do we market? How do we advertise? Do we advertise? What do we do right now during a crisis? And so, Chris and I, we want to get very tactical, very practical with you today. We're also going to talk strategic as well and hopefully this will be inspiring and informational and you'll leave here charged up and ready to do the absolute best that you can right now. And so, primarily on the tactical side, we're going to dig into Google Ads, YouTube Ads, and Amazon Ads. But again, we're going to get strategic, so even if you're not on those platforms or you're on other platforms, this will still be useful.

Brett:

And so why are we doing this? Why are we hosting this webinar talking about seven ways to market in a crisis? And the ultimate reason is, we want to help. I love what a crisis can do in terms of bringing out the best in humanity. We've seen this with our team. Our team is rallying around our clients, coming up with creative ideas and how do we grow sales, how do we save sales, how do we make things work? And so that's really the spirit of this event today is, how do we give you actionable ideas, some good strategies, some good mindset tips, maybe even some examples of how you can succeed right now. So really this is all about giving back. We do have some specific ways we can help and a couple of offers. We even put together our own stimulus package Chris. And so we'll talk about our own stimulus package at the end. But this will be educational and hopefully extremely helpful.

Brett:

Just a couple of really quick things about our agency for those that don't know us. We're a team of 38 and growing. We're all remote now. We're usually ... The majority of us are in our offices in Springfield, Missouri or New Jersey. We're all spread out now, all remote. We are one of the top spending agencies on YouTube ads and so we'll talk a little bit about YouTube ads. Right now we're seeing some things on YouTube that we've never seen before because of this crisis that actually opens up a lot of opportunities for you. Chris mentioned the ultimate guide to Google shopping, we'll show you how to get that later if you want to take Google shopping to the next level. And then yeah, we speak at industry events where you'll find us online and in person. And so there's a quick look at our team. And the reason I point this out is because our team is day in and day out in the trenches, coming up with the marketing ideas, testing things. We're getting real time data now on what performance looks like in eCommerce during this crisis and during this time, these times of uncertainty. And so even yesterday and last night, I was polling the team and saying, "Hey, how is this working? How is that working?," so that we could report that on this webinar.

Brett:

We did recently ... This was actually one of the last, I think, big live events before things started getting shut down. This was in February. Got invited to speak at the YouTube LA offices. We did about a half day workshop there with about 140 different attendees. 100 eCommerce brands. Talking all about how to utilize YouTube ads for performance growth. So YouTube ads to directly drive sales. We'll be sharing some insights from that. We've also got some other resources that'll be free that we talked about at that event. We're going to talk about Amazon ads too, so if we've got some Amazon sellers here as well. But that's a picture on the left there of myself and our director of eCommerce, Chris Tyler. We are one of the fasted growing Amazon ad agencies and so it's about a year and a half ago ... I'm terrible with dates. I don't know. We got invited out to the Amazon HQ because of our rapid growth to meet with the Amazon ad teams and talk about new developments with Amazon advertising. And so we're going to also show you what's going on with Amazon right now. How have our clients been impacted by what's going on and what's working specifically from an Amazon ad prospective.

Brett:

And so, what do we do? What do we do right now, right? That is the question. What in the world do we do right now? Do we go quiet? There's feedback on Facebook and other places, people saying, "How dare you advertise right now?" So is that the approach we take? Or do we potentially step things up because there are tons of opportunities right now? And so a couple of things that are interesting. Right now internet usage, up 35%. So this is all online traffic. Up 35% right now. We're all at home. We're all stuck in front of our computers. We're all online. And this includes YouTube, Google, Amazon, everything. Internet usage period is up 35% right now. We have a lot of good friends that have organic YouTube channels. One's in the fitness space. I just did a podcast with her recently, Liz Germain. I highly recommend you go listen to that episode, eCommerce Revolution Podcast. But she's seeing ... And then she has some friends in the financial space, their organic view on YouTube are up 130 to 200% right now, so huge. And then a lot of big advertisers have pulled off the platform.

Brett:

And so you've got the scenario where ad costs are going down because there's so much inventory and people are paying attention. People are available. And people are still shopping. People still like to buy. There's that retail therapy that people can't get in store but they can buy online. And so what's interesting ... So talking about some of the things that have really shifted now, looking at online grocery and how in 2018 only 36% of customers bought groceries online. That shifted to 55% in the month of March. And then if you look at Google trends for online grocery and how they've exploded ... Just recently, so this is just a few days ago. Looking at how that trend has blown up. And then this was some data from Sellix. So this is specific to Amazon. So what Amazon categories have grown. And this was growth from the beginning of March to the kind of mid, end of March. So grocery, up 26%, appliances, up 14%, household items, up 13%, toys and games, up 10%. So that's even growth inside of the month of March, which is just absolutely crazy.

Brett:

We're seeing this with our sellers as well. We have clients selling crafts and toys at home. We have clients selling things like supplements. And some of those categories are just way way up on Amazon. So what we're seeing ... And these are recent numbers, so even in the midst of this crisis ... So we got some dashboards we built tracking day over day, week over week, month over month, and year over year, sales for our clients. And even in the midst of this, we're all eCommerce. 67% of our our clients are still up at least year over year, 16% are relatively flat, and then the rest are down. And really the only areas of eCom that are down are things like apparel and fashion taking a bit of hit. Luxury goods. So some high end, handmade goods are down just a little bit. But for the most part eCommerce is up and/or in a really strong position. One thing we've talked a lot about Chris, is as people shift some of their behavior to buying online ... They're doing it now out of necessity. But as they see how easy that is and as they have good experiences with retailers, some of that buying behavior is going to continue long after we've recovered from this crisis. So huge opportunities for eCom.

Brett:

All right, so let's dive right in. So seven keys to marketing in a recession or marketing in a crisis. And so let's talk about ... This is kind of the foundational area. So we talk about hey, do we pause everything? Do we press full speed ahead? Do we pretend like everything is normal? Do we change everything? So what do we do? And what's really important is to understand, what's the mindset of the shopper? What's the mindset of your prospective customer and you're existing customers? What are they thinking and feeling right now? Do they want to still buy? Do they not want to buy? And so we're going to break down ... Actually look at this article. Highly recommend this article. We can share the link but you can also just kind of google it and check it out here. But how to market in a downturn. This is from the Harvard Business Review. This what written during the great recession. But it was a study looking at previous recessions and what shifted in terms of consumer behavior? How did different products fair? And it's really some great insights. And even though this was unprecedented, what we're experiencing now with this pandemic leading to a economic shut down basically. We haven't seen that exactly. It still has some characteristics of other recessions.

Brett:

And I think people's response to this is at least in some ways very similar to other recessions. And so our response can be similar in some ways as well. Let's talk about kind of these four mindsets. These four segments with consumers now. So, these are kind of the four ways people respond to crisis. One is the slam on the breaks crew. So this was the crowd that just says, "Wait, I'm not going to do anything. I'm going to basically stop all spending except for essential products. But I'm slamming on the breaks, I'm freaked out, I'm nervous, I'm worried about the future so I'm slamming on the breaks." Then there's the pained but patient crowd. So they're feeling some pain. Maybe even now they're laid off or there's fears of being laid off, but they're patient. They're still at least somewhat optimistic. In most recessions, this is actually the largest group of people. People that are pained, but patient. So probably in our environment we're facing right now, these are people that still have their job but maybe they've lost some hours or maybe they're just uncertain if is a layoff going to come for my category, for my company soon? So they're pained but they're patient.

Brett:

Then we've got the comfortably well off. So these are folks that financially, they're doing great. They're not worried about, are they going to be economically viable at the end of all this? They're confident in that. Now they also shift their behavior. We'll talk about how in just a minute. But they're comfortably well off. We found clients that are serving comfortably well off individuals. And depending on what you're selling, you are likely doing very well right now. And then there's the live for today crowd. So this is the crowd that they're going to live like everything's normal because it's kind of the carpe diem. I'm just going to enjoy life. Whatever. I'm not going to worry about it.

Chris B:

Were those all the spring breakers that were on the news a few weeks ago Brett?

Brett:

I think so, yeah. Those are the spring breakers. What the research found is this crowd, unless they lose their job, they almost change their spending zero. They just keep living life like normal. Okay, so we kind of got to understand these segments and how we approach them. Because, except the slam on the breaks people, all of these people still buy. And one thing that's interesting that I think we got to keep in mind is that, right now like the normal ways we may slice and dice an audience, so looking at age and other psychographics, it really more comes down to this. Because age doesn't really matter here. I heard a deal recently that totally makes sense that we act more our income than we act our age. And we're going to act more accordingly to what we're experiencing and feeling right now versus some other prepackaged demographic that may have had relevance in normal times. So thinking about, how these folks behave.

Brett:

But kind of to go with that ... And then we'll break these down because they go together. Thinking about the category of the product you sell. So what is your current category and how are people, why are people buying that right now or why are they not buying that right now? And so as we look at a couple of categories of price, we got essentials. Those are doing great. Toilet paper, groceries, hand sanitizer if you find it. That all is selling great. So essentials, doing fine. Treats. These are things that people view almost as a necessity, but it's more about the enjoyment of that product rather than supporting the life, like a true essential. Then you've got postponables. These are things that people want but when push comes to shove or they get in a pinch, they could postpone it. And then expendables are areas that people say hey, I don't have to do that. So postponable right now could be travel. And expendable could be some kind of big purchase around the house. A new car, maybe it's a new sports car or something like that, where it feel like, I just don't need to do that at all right now.

Brett:

Now what's interesting about these products or these categories rather, is these are all subjective. So this is all kind of in the eye of the beholder. It's whatever the prospect perceives. So this is not like there's some predefined rule around this. This is all subjective. And so as we look at this ... And again, this was from that Harvard Business Review article. How do people in those different segments ... How do they treat different products? So let's just take that comfortably well off crowd. So if it's an essential, they're going to continue to consume it at pre crisis levels. They're going to just keep buying like normal. If it's a treat, they're probably going to keep buying, but they may be more selective about some luxuries. And one of the things we've seen and then heard with this group, is that maybe they're less conspicuous. They're not going to do anything that's showy. So if they bought a new car, they maybe wouldn't talk about it because they feel maybe a little self conscious that they're buying expensive things when other people are hurting. So the conspicuous purchases maybe have reduced.

Brett:

And so then as we look at some these ... Like as we look at postponables and expendables, those are the areas that really the slam on the breaks and the pained but patients, they shift that quite a bit. A lot of the other categories either continue like normal or continue with slight changes. So what we see with a lot of these is that, what maybe was considered essential before, now someone considers it a treat. But they still want to buy it, but they may be looking for value or something slightly different. So one of these we see is that brand loyalty shifts and price sensitivity also shifts in a crisis. Which actually is a great opportunity for us. So maybe someone was really used to this other brand of deodorant or toothpaste or whatever, now in the midst of a crisis, I can't maybe go and get the toothpaste or deodorant like I could before, so now I'm open to new ways, I'm open to new offers, I'm open to new things. And so the way people approach these types of products, the way they shop has definitely shifted. Do you have a thought there Chris?

Chris B:

Yeah. I get the pleasure of talking with usually two to four eCommerce brands every single week and it's been really interesting to watch this progression and I've actually had a couple of potential clients come back that were sold in retail outlets. And they were really nervous about going direct to consumer because they didn't want to interrupt the relationships they had with their retailers. And I always thought they were over thinking that. And so now they've got people that love their products that can't get them because the retailers are closed and now they're scrambling to find channels to get those products out there, but the challenge for them is, their cashflow has dropped. So for native eCommerce brands, which I suspect are many of you on this call, you just have to aware of, what are the kinds of products that I may have had competitive pressures, that people could buy at retial, that now they can pickup direct from me? Because like Brett said, you've got a lot better opportunity for those cheaper awareness consideration kinds of buys now than ever before.

Brett:

Yeah, without a doubt. And we're seeing this quite a bit. So to tie that into what we're seeing, just comparing kind of Amazon with off Amazon retailers is, we have some clients that sell a lot on Amazon and on their own website. As Amazon was running into some delivery issues ... First they weren't accepting items into their fulfillment centers and then they were kind of slow to ship things. They still are kind of slow to ship some things. We've seen with some clients 20, 30, 40% of those purchases shifted to their dotcoms, so off Amazon, because people still wanted that product. So you are finding this scenario where people still want certain items, they just can't get them the way they did before and so we've got to be ready. We've got to be ready to step in and fill those needs. And so we're going to talk about in quite a bit of detail, what to do to capture now buyers on both Amazon and Google. So we're going to dig into to that here in just a few.

Brett:

So then key number three. Looking at opportunities for growth that your competitors miss. So we talked about this a little bit in the lead up. Hey, do we just pull back? And there are a lot of big advertisers that are pulling back. Anybody in the travel space or anything like that. And in some ways it makes sense to pull back a little bit. Although I think there's some strategic ways you could market if you were in travel right now because everybody wants to travel. My family, we love to travel. We're still dreaming and talking about travel. We're still researching travel. We just can't do it right now. So I think almost regardless of your industry, you could still be marketing right now. And I think also serving your customer. Because there's actually joy that we take in researching an upcoming trip. Or, we're still buying stuff for around the house. There's still some joy we take in shopping for that next home décor item. We're all at home. We're all looking around. We're thinking of things that we need to buy. And so, kind of two sides of this. Seeing both the opportunity because your competitors are pulling back, and then also seeing hey, your customers still want to buy. And you're actually potentially bringing them joy if you give them the opportunity to buy. Then it should show us some areas of opportunity.

Brett:

So, what I want to do before we get in the tactical practical stuff is let's talk about some companies that grew in a recession. What was a fascinating mental shift for me several years ago where I remember talking to some really smart business people and they would say, "You know, we need a good recession. Because that's when we're going to grow." Or you hear advice from guys like Warren Buffett who says, "Hey, when everyone else is greedy, I'm fearful. But when everyone else is fearful, that's when I get greedy." So looking for opportunities when people are fearful, when businesses are fearful. And so here's some examples. So, my kids ... Chris mentioned I've got a lot of kids. I actually served multiple bowls of Rice Krispies just this morning because our kids love Rice Krispies. But in the 1920s Post dominated the cereal market. They owned the cereal market. During the great depression, especially in the early days of the great depression, they pulled back. They went into conservation mode. They really slowed down spend big time. Kellogg's seeing an opportunity said, you know what, they're going to pull back, we're going to press ahead. They doubled their advertising spend and they released the Rice Krispies, Snap, Crackle, and Pop. And so they actually grew profits by 30% during the great depression.

Brett:

And they became the dominant cereal seller and Post has never caught up. Kellogg's still dominates in the cereal market even dozens of ... However many decades later. Yeah, not dozens, but yeah.

Chris B:

Yeah, and we got a great saying out of that time as well. Because that move by Kellogg's was known then as marketing in crunch time.

Brett:

One thing you may or may not know about Chris Brewer is he is a master of puns. He's always thinking about puns, he's always trying to sneak one in there for you whether you're ready for it or not. And so, it's crunch time. I like it.

Chris B:

All about audience engagement-

Brett:

I like it. Hey I like it. That was smooth. Crunch time. Toyota. I love the Toyota brand. I drive a 4Runner. I like it. During the 1974 recession ... Actually it was kind of like 1973 to 1975, before my time. But still, when gas prices went crazy and that fueled a recession, a lot of auto makers pulled back. Toyota who was not the primary import manufacturer ... That was actually Volkswagen at the time. Toyota saw an opportunity because they were a fuel efficient car for the most part. They pushed full speed ahead and started marketing way more aggressively than they did before and touting things like fuel economy and stuff because they were one of the most fuel efficient. And by 1976 they were the top import manufacturer of automobiles. They surpassed Volkswagen because they accelerated ... Hey, you like that Chris? Accelerated in the midst of a recession. And then here we go, this is back to-

Chris B:

It was quite a shift.

Brett:

It was quite a shift. So in the '90s, man, I remember Pizza Hut in the '90s. That was like a magical place for kids. I was a chunky little kid. I enjoyed Pizza Hut probably too much. But in the early '90s, so '90, '91, that recession, McDonald's pulled back in their advertising. They went conservative. Pizza Hut and Taco Bell seeing opportunity, pushed ahead to try to gain market share. And during that time Pizza Hut sales grew 61%. Their sales grew 61% in the recession. Taco Bell grew 40%. McDonald's declined 28. So the key here really is not to use a cleaver as you're looking to cut or refine or change what you're doing, but to use a scalpel. So look at okay, we can't just go full speed ahead like nothing has ever happened. We have to be strategic but there's so many opportunities right now and we need to capitalize on them. So that's a great place to transition into, what should we do with our message right now? So if we're going to market, we can't just be tone deaf and say the same thing that we've always said prior to this crisis. We have to potentially reposition our product slightly. We're going to give you several examples here. And we have to use relevant messaging.

Brett:

So messaging that speaks to us. We're all working from home. We're all at home. We can barely leave the house. So certain messages will resonate with us right now. Certain messages will potentially offend or at least not motivate us. So how do we shift our part a little bit? How do we reposition it? How do we use relevant messaging? So Huckberry. I recommend you get on the email list for Huckberry. They're primarily a fashion brand. Kind of a hip fashion brand for men. That's kind of where they focus. But they put together this work from home sale. So the WFH sale. They also talked about the WFH mullet. So here's a quick little bit of copy that suggest ... They talked about what the WFH mullet is. The work from home mullet is business up top, party down below. So where you're maybe rocking the shorts but wearing this merino sweatshirt up top, or sweater up top. And so, they talk about how amazing this product is. It's actually on sale. And then as you scroll through the email, they've got some unexpected ways to brew coffee with a couple of little items you can buy. Antimicrobial towels, because that's something we're definitely thinking about.

Brett:

What's your work from home setup? Show us on Instagram. So getting some social engagement. So the whole message is tied into the work from home shift. So this is what we're all doing, so make the message on point. It's also fun. It's not this normal hey, here's how we're handling COVID-19, just to reassure you. We all got like five million of those emails. We hated every one of them. This at least addresses there's been a shift, here's how you can get the most out of it. We understand what you're going through. You're rocking the WFH mullet probably right now. I'm actually wearing jeans. I don't know about you Chris, but I went ahead and rocked the full setup. Are you going to show us here? I didn't know you were-

Chris B:

No, I was not ... I do have pants on, I was not going to stand. What I was going to mention, I was just curious from those that are watching the webinar ... And just put a yes into the chat if you have found yourself watching commercials. Whether it's a YouTube ad or it's a television ad. I've noticed this on local news especially. That it just strikes you that this is an ad that was pre virus.

Brett:

Yep.

Chris B:

And if it's striking you, if you're recognizing that, then you're consumers are recognizing that as well. So I've personally been very impressed. And it just shows you ... Brett'll talk about this later. But we get so many people that come to us excited because they've heard what we have done for other brands on YouTube. And they just don't have the content ready and they're making it really hard on themselves to actually create content when it doesn't have to be that difficult. I've just been very impressed with some major brands that you can tell they just took existing content, edited it slightly to change the messaging for work from home, and those were hitting the airways very quickly. So this is very doable.

Brett:

It's doable. It works. If you don't make the shift, people are going to be at worst offended and at best, probably not respond. So I love this. We actually saw this from a ... We know the guy that runs this company, but the idea that your cellphone carries a ton of germs. I've even heard people say that there are more germs on your phone than on your toilet. And so they ran a buy one, get one sale. They call it the wash one, wear one. So ideally you're going to wash a phone case one day and then wear it the next. So you want to wash them every day. So they did a hey, wash one wear one. It was timely. We're all thinking about what do I need to be sanitizing and what do I need to be cleaning right now. And so your phone case is definitely one of them. And hey, we'll give you a free case. So buy one get one, so there's a discount wrapped up here and there's a compelling reason to buy this case. So this was a brilliant move and worked very, very well. So look for something like this.

Brett:

This is also a time to strategically discount. So don't just discount for the sake of discounting, but discount in a way where you're saying, we just want to help. We want to help and so this is our way to help you be more sanitary. So wear one, wash one. Super powerful idea. This is actually a client of ours and we actually helped them come up with this idea. These are ginormous blankets. 10 by 10. They're 100 square feet. Covers like a king bed and it's still draping off the ends. Well, one of the things we're seeing ... We've got some clients that sell arts and crafts and other things for at home. The at home market for kids. And they're just exploding. And so we're thinking, hey again, you're working from home, you got kids, how are you going to entertain them? We don't want our kids just to be watching screens constantly. So we had this idea, what if we talk about building epic blanket forts. So maybe just using this as an idea for remarketing. So someone that's been thinking about a big blanket, they have not purchased yet. Let's use the epic blanket fort as a reminder of hey, you know you've been thinking about the blanket ...

Brett:

This is an idea of, people buy for emotional reasons but they back it up with logic. And so going back to those is something an essential, is it a treat, is it a postponable, is it an expendable? You can help shift your product in the mind of the customer by doing things like this. So maybe ... This was our reasoning. Maybe someone was looking at a big blanket ... Because they're not super cheap. And they thought well, I could postpone that. I can wait. I don't have to spent 140 bucks on blanket. I'll just wait. But then they get a message, "Hey, this will entertain your kids for hours. It will be the most epic blanket fort you've ever seen." And so now maybe that's enough for them to say, you know what, that was a postponable, now I'm going to consider it a treat. It's worth buying right now, I've got the money, I'm just going to do it. So looking at these ways to creatively reposition your product. This isn't diverting from the core. It's not saying hey, we were a luxury brand, now we're a cheap brand. It's not that. It's just saying I'm going to slightly reposition my product to get people to take action right now.

Brett:

Love this. This is from our buddy Ezra Firestone of BOOM By Cindy Joseph. So you know, thinking about how people are stressed right now. A lot of stress, a lot of anxiety. So again, I like this way better than if they just came up with an email, here's all the things you can do because of COVID-19. People are bombarded with that. Don't do that. But send them tips on how to turn your home into a spa. So here's skincare, makeup alternatives, things like that. And what we've seen ... We've seen this across multiple ... We have multiple brands that sell skincare and makeup and stuff. Most of them are not down. Most of them are actually up right now because people still want to feel beautiful, they want to look beautiful even though they're not going out. And so this was more about relaxing, decompressing. There's health benefit. When you're not stressed it's good for your immune system. Things like that. But three ways to turn your home into a spa. This was an email. This went very, very well. And they kind of did a sale in conjunction with this also. So think about creatively, how has consumption of my product shifted? How has the way my product is perceived or used shifted? And then shift your message accordingly and it will make a huge, huge difference.

Brett:

Cool. All right. So let's get tactical. So the rest of these keys, five, six, and seven are very tactical and practical. We're going to talk about specific ad types, what we're seeing, how things have changed and what you need to do about it. So as we talk about maximizing now buyers, we're going to look at people that are actively searching for your products on either Google or Amazon and what to do about those. So let's talk about Google first. So people searching for products on Google, we've seen this increase and as Amazon goes through fluctuations of slow delivery times for certain products and things like that, there's going to be more opportunities for off Amazon brands selling through Google shopping. So looking at Google shopping, there's product listing ads or the text ads. A couple of things you should do right now. Let's talk shopping feeds first. This is what we're doing right now for all of our clients. We're thinking okay, if shopping is increasing, meaning people that are searching online for products is increasing, we want to make sure we're putting the best foot forward. So we're optimizing images, we're testing new images, running secondary images to our feed because the picture or the product makes a huge, huge difference.

Brett:

We're maximizing things in the feed like product type, which we don't really want to get into on this webinar, but if you download the ultimate guide to Google shopping, which is free on our site, you'll see some tips there related to product type.

Chris B:

And one of the most ... When we're doing audits of people's shopping feeds, this is one of the most missed areas.

Brett:

It is. Product type is either ignored or under leveraged. And basically what product type is going to all you to do, it's going to allow you to show up for more searches, for more search queries. Even competitive search queries and things like that. So maximizing product type, now is the time to do that. And then you want to bid aggressively, but also watch your search terms. Because there's going to be some interesting things popping up in your search term report because some of the new ways people are searching are changing. We're going to give you some examples here in just a second. The other thing you want to look at is anybody that's visited your site but has not purchased, and now maybe they're going back to Google and searching, you want to make sure you capture that. So we call these remarketing lists for search ads or RLSA's. But a couple of the audiences you really want to make sure you're focusing on visited your site but haven't purchased, cart abandoners, viewed video audiences, and then also layering in in market audiences. So people that Google has identified, hey, they're in the market for skincare or they're in the market for jewelry if you sell jewelry.

Brett:

So layering in some these audiences can allow you to bid more aggressively on these audiences meaning you're more likely to show up for people that fit into these audiences and then more likely to convert.

Chris B:

And just another little bit of data. Only about 50% of the eCommerce brands we evaluate are layering in audiences.

Brett:

Yep. It's a simple thing. It can make a huge, huge difference. So it's one of the early things we did for BOOM by Cindy Joseph. We run all their Google traffic. Was layering these RLSAs. And the number of sales we get from Google shopping now, just from these audiences is massive. Massive. And so it's a huge opportunity. But think about the way things are shifting. So consider what's going on in the news. Consider what people are talking about. So let's just use elderberry as an example. I don't know if this was mentioned on TV news or online or a combination or what, but elderberry, it's very much an anti ... What am I trying to say here? Just totally lost the word. It's immune support. So it's an immune booster. So if you look at about March 15th, this is the relative number of searches for a particular thing. Look at how that shot up in March. It went from where it was, like indexing 25 to hundreds, so it peaked. Huge, huge search volume. We have several clients that sell supplements and immune support supplements. We saw this in their search query report. Everybody was looking for elderberry.

Brett:

That seems to be tapering off a little bit. I don't think people are talking about it as much. And this also maybe, hopefully, means that some people are getting a little more hopeful about the situation or maybe less concerned about buying things like elderberry. But it definitely peaked and so it's one of those things where you hear something like that on the news, prep for it, know there's going to be a peak in searches. Also things like this. This was really interesting. One of our specialists found this. People looking for things like healthcare worker discount. If you're not selling something that's specifically for healthcare workers, people are looking for that. Are you offering a discount? Are you helping the men and women that serve in healthcare, on the front lines? Are you doing something to benefit them or help them? So that's a new thing you could consider. Maybe even create an ad. Discount for healthcare workers. One, it makes you look good. I should say one, it's the right thing to do, two, it makes you look good, and three you'll make sales. So that's a new little trend. Won't be around forever but likely for the next few months, so definitely consider that.

Brett:

This was also interesting. We've seen this directly looking at search query reports for our clients. Free two day shipping, same day delivery. Searches with those in it have gone way up. Now do you have any theories as to why that might be Chris? Why are people all of a sudden now looking for these types of delivery when maybe weren't before?

Chris B:

Uh, let's see. They don't want to go out.

Brett:

Yes. That is the primary reason. But also why, think specifically about who usually guarantees these types of delivery times.

Chris B:

Of course Amazon FBA.

Brett:

And they're not. Yeah, so Amazon is not delivering now so people can't go out, they're shopping online. These are usually delivery times that Amazon has in certain cities. They can't fulfill that now unless it's essential. So people are looking for this. So if you can provide this type of shipping speed, you will make sales right now, even if you charge for it. Because that's one thing. People are price conscious more so than usual but it's sort of fluid. It's like well, but I still want this and I can't get it any other way so I'll pay for the two day shipping.

Chris B:

Yeah. The other thing I'd mention is Brett ... Before you go to the next slide. The other thing I'd recommend in addition to your search term report and your Google ads account ... You and I are both old SEO guys from long ago and in your Google analytics, if you take a look in your Google analytics ... Actually it's in webmaster-

Brett:

Webmaster tools. Now it's search console.

Chris B:

Search console. Yeah. If you look into search console, go in there and look at the search terms that people arriving at your site. You'll get a huge list. But look at how those have changed in the last 30 days. You may find some nuggets there that you can roll over and into your ads and your promotions as well. So that's just anther tip outside of Google ads to look for what people are searching for.

Brett:

Yep. Absolutely. Yep. So look in your search query report in Google ads but also look at it in search console as well. I'm looking here at some of the other categories people have mentioned, so at home gym equipment, tools and home improvement. We're seeing both of those categories way up. Home gym and home workout equipment way up. That's also an area that Amazon has really struggled with deliveries on. So if you're able to deliver on your own and ship on your own. Big opportunity. You're going to have people that are going to Amazon looking for those items, seeing that they can't get it delivered for three or four or five weeks, and they're going to go to Google and search for someone else that can maybe deliver that. Same with tools and home improvement. Before things got real crazy with the lockdown we were buying paint and supplies because we're home. Let's get some stuff done. Truth be told, I'm not painting at all. My wife likes to. I hate to paint. But she's getting a lot of painting done and she's enjoying it. And I'm enjoying not painting. Those things are definitely up. I see some people telling me skincare. Not all skincare is up. We're seeing a few categories, but a lot of skincare is up right now which is great.

Brett:

Cool. This is something too that no surprise, but just finding things like this are super interesting. So we have a client in the jewelry space, they also have a physical store. But as we look at searches for things like near me, have gone almost to zero. Before, people were searching for, hey, this kind of skincare near me or this kind of product near me. People aren't doing that. Because near me is irrelevant. I just need it shipped to me and so people are definitely looking for that delivery, which is interesting. Here's another one. Masks for nurses. So again, looking at what area of consumption, what types of things are people looking for? Masks for nurses on Google trends has shot way up. So also look at your auction insights. Here's something that our Google rep told us which we thought was actually brilliant. Looking at competitive conquesting. So most of our clients will run a competitive campaign. So bidding on your competitors names as a key word. So if someone searches for your competitor, your ad pops up, maybe you can woo them to shop for you. Here's what's interesting, some people are backing off ... Just like Post in the great depression and other companies. They're scaling back their ad spend.

Brett:

A lot of them are scaling back ad spend on their own brand name because ... What are they reasoning? They're saying, I show up organically for that keyword anyway. So I'm going to stop paying for clicks for my brand name. That gives you an opportunity to step in. So one of ... Kind of a client of a friend of ours, they were looking at their auction insights report inside Google ads and they noticed that CPCs for their competitor's brand name were down 15%. So they stepped in, they created a new campaign, they bid for it. Now they're getting a lot of clicks, a lot cheaper clicks, stealing some customers from your competitor. So look at the auction insight report, consider what of your competitors are backing off or slowing down right now, great opportunity for you to step in-

Chris B:

And another little tip that I'll give you, because we find this on virtually every Google audit that we do. That their competitive campaigns are using, not necessarily the wrong bid type, but take a look at what Brett just told you but look at hitting on a target impression share bid for those kinds of campaigns. Because your quality scores for competitor campaigns are not going to be as good as your own. So that target impression share bidding method can really help you not only on getting those a lot cheaper than you used to, but getting a lot more impressions for those terms as well.

Brett:

Yep. And something to test. Now getting a higher impression share is going to be cheaper. So now's the time to do it. So also some of you experiment with the target CPA or target ROAS. Just play with the numbers. It's one of those things where you kind of have to experiment in your own business. But I think the bottom line is now's a great time to be looking at how can we creatively do some competitive conquesting, which is a super powerful strategy.

Brett:

So let's talk about key number six, looking at remarketing aggressively. So if anybody has shopped your site, added to cart, viewed a video, whatever, but they have not purchased, now's the time to remarket to them but with a creative message. So just like we we're talking about with Big Blanket, hit them up with a message that's slightly different. Or like Huckberry was doing, or like BOOM. So remarket aggressively with a creative message. And here's what we're recommending. We recommend this all the time, but now it's really important. Hit prospects from multiple angles and on multiple channels. So we recommend GDN, YouTube, and Gmail. Running all three of those remarketing campaigns to all three. And so here's kind of what we're seeing. And one thing that's newer to the Google Display Network is discovery ads. This is kind of a preview of what it would look like. You've probably seen these when you've been on the mobile app for YouTube. They're display type ads, but they show up right there in the results, or in that opening feed for YouTube and they're highly engaging and really appealing to click on.

Brett:

There's kind of this carousel ad on the right. And then there's more static ads there. But these discovery ads are very, very powerful. We're seeing that CPAs, or cost per acquisition, cost per sale, 30 to 60% lower than standard display ads. We're actually using discovery ads for top of funnel. So reaching cold audiences as well. But I wouldn't recommend starting there. I'd recommend starting with remarketing. But just know you're going to be more efficient. You're going to have better performance with discovery ads than you will just standard display ads.

Brett:

Another thing that not a lot of people are doing is when you're running remarketing campaigns, take your top YouTube ads, if you have them, put them into a display campaign. Basically what's that's going to do, and this was an example from BOOM. We run a lot of display remarketing. Even a little bit of top of funnel display. The top performing creatives for the display network are actually their YouTube ads. So it's going to look like this, the ad unit there on the left. It's going to be a clickable, playable video. You've probably seen this on different news sites and blog sites. So basically it's your YouTube ad, but it's appearing in the Google Display Network. So it's on news sites, blog sites, things like that. We're finding a ton of engagement, lower CPCs for YouTube ads that are on the Google Display Network.

Brett:

Gmail ads. This is something that we don't see a ton of people running. Again, Chris you talked about audits. This is one we see people either missing or not doing very well. The Gmail campaigns, they show up just like emails and they're a combination of videos, images, and text. And again, we're seeing some great performance. CPAs often 30 to 50% lower than standard display. And just extremely compelling to click on.

Brett:

Let's talk Amazon. Amazon DSP. That stands for Demand Side Platform. These are display ads that you run on and off Amazon. And so basically what this allows you to do is run display ads on Amazon.com, on the mobile site, but also ads across the website on Espn.com and Yahoo.com and things like that, but sending people to your Amazon listing. And so, ads look like this. This is for Varidesk. That's actually the Varidesk that I have. I love that desk. But this is an ad that appears on Yahoo. Here are some ads that are on the bottom of an exercise machine page. So this is a StreetStrider. I'm not even sure what that is. But this was the product detail page on Amazon for the StreetStrider. At the bottom of that page, or just below the listing, there's an ad for Nordic Track and an ad for a smartwatch. So those are Amazon DSP ads. Here's a category page for some exercise equipment, and then there's an ad for Timex right next to it.

Brett:

Here's what we're recommending you do with Amazon DSP. Start with remarketing and aggressively remarket to people, starting first with people that view your products. People that have viewed your products and have not purchased. It's a great place to start with Amazon DSP. Then also consider cart abandoners. So people that have added your product to their Amazon cart, but have not purchased it. Hit them with display ads, wooing them back to your Amazon listing. Also look at cross-sell and reorders. So you can also build an audience of people that have purchased a particular product of yours, and then you can run reorder campaigns if it's a consumable. Or, maybe they bought one of your products but not another. So you can run a cross-sell ad.

Brett:

And here's where it gets kind of crazy, and these are working well right now too. You can also build an audience of people that have visited your competitor's products on Amazon but have not purchased, and you can run an ad for your product. This is one of those things that as a marketer when I first learned about it my response was like no way. This can't be possible. But it is possible and it works. And so, nobody has more shopper data than Amazon, and if you're selling on Amazon and you're not using DSP, now is an amazing time to start. Again, costs are typically lower right now. Ad costs are typically lower. So if you start with at least remarketing, then maybe consider competitive conquesting, now's a great time to be doing DSP.

Brett:

And then kind of finally, and we'll potentially open up to Q&A if we have time, but number seven, invest in top of funnel advertising. Because costs are low, and because people are at home, and because people want to shop, now's the time to invest in top of funnel. So go after those cold audiences, people that don't know about you. Try to reach them and get them to try out your product.

Brett:

I want to talk quickly about one of the hottest trends in Amazon advertising. This is an ad type that's working very, very well for us. Sponsored brand video. As I talk about it I'm actually going to play a sample here. This is what it looks like. You've probably seen this on the mobile app where you're scrolling through and then, oh, video pops up. Look at that. It's just super eye catching and powerful. It's the ultimate scroll stopper. And what we're finding is ... These ads used to be on a pretty limited beta. Now they're available in more of an open beta. So you should have access to those in your seller central. If you don't, give us a call, we may be able to help there. But what we're finding with this ad type is lowest A cost of any campaign type, and some great new to brand performance. So what happens is usually these ads show below the fold or on desktops at the bottom of the page. So most of the clicks for sponsored brand video are coming from category searches. Not brand searches, but category searches. So a lot of times the people you're reaching are new to brand. Not people just searching for your brand.

Brett:

So tremendous performance. We've actually got some cool things we're doing right now to help you with free video production for these types of videos. We'll talk about that in a minute. But sponsored brand video is super powerful. Now, we talked about that YouTube event that we did in LA a few months ago and so we're big believers in YouTube TrueView and all the ways you can use that for remarketing, but also top of funnel. So let's just talk about a couple things related to YouTube that are important to consider right now. We've seen costs on YouTube down 20 to 50%. This is not true with every audience but it is true mostly across the board that costs were down 20 to 50%. So now there's more people you can reach. A lot of people can't get out and shop. And your cost to reach them has gone down. Pretty powerful.

Brett:

We've got some proven ad formulas for top of funnel YouTube. I want to share these with you. We've actually got a free guide as kind of our top swipe file of best YouTube ads for eCommerce. We'll show you how to get that in just a minute. But we recommend if you're going to start with YouTube, start with some of these kind of bottom of funnel audiences. Audiences of in market people. So people that Google has said hey, they're in the market for grocery, or they're in the market for skincare or for jewelry or whatever the case may be. Or some of these other intent based audiences. So look for people that are actively shopping. This is another way to kind of zero in on those people that maybe their behavior has just shifted to online. So maybe they're comfortably well off or they're pained but patient. They're still buying. Using these audiences is a way to find them on YouTube. So these are two of the audiences we recommend you start with. Custom intent and/or keyword audiences.

Brett:

Because here's what's happening. This was even before the crisis started. 80% of people will switch back and forth between search and video, and 55% of people say they watch a video to learn more about a product before they buy it. I don't have updated numbers in the midst of crisis, but those numbers are growing in the midst of the stay at home orders and things like that. And this again was before the crisis, but one third of all shoppers purchase something that they discovered on YouTube, and that's only going to increase.

Brett:

So let's talk about a couple of resources here Chris, and then we'll kind of maybe open it up for Q&A. We can stick around a little bit longer. And then also want to talk about a couple of really cool offers. So first of all, some free resources, free guides. We've talked about the ultimate guide to Google shopping. If you go to our site, omgcommerce.com, click on resources and guides, you'll see these. We've got our ultimate guide to Google shopping. We've got the Amazon DSP roadmap. So if you want to learn about the ins and outs of DSP, how it works, some other ad examples, things like that, download that free DSP roadmap. I talked about our swipe files. So the top YouTube ad examples and templates. That guide's available as well. And then we also have the authentic guide to customer testimonials. Getting video testimonials is very important for YouTube ads, Facebook ads, Instagram ads. So I put together a guide, I've actually done a lot of work in TV and stuff, on how to get authentic testimonials. So you can check that guide out as well.

Brett:

And then one thing I thought I'd mention. Brewer, you mentioned this at the beginning, the podcast. We've been trying to crank out episodes recently that would be helpful during the downturn. I mentioned the episode with Liz Germain. She's a YouTube influencer. She's generated over 100 million organic views on YouTube. We put together a podcast talking about how things have changed right now during the crisis. Roland Frasier, mentor of ours, friend of ours. He talked about how to market and how to get financial stability in a crisis. Then I talked to some really cool dudes at Original Grain Watches about how to build a brand, how to maintain your image, but also how to market in a crisis. So check out those podcasts as well. Also did a podcast recently with Daniel Harmon of Harmon Brothers. They're the group behind Squatty Potty and Poo-Pourri and some of those other viral YouTube ads. Did a great interview with him as well. Highly recommend you check that out.

Brett:

Now, let's talk a little bit about our stimulus package Chris. You and I were brainstorming a couple of weeks ago and we thought hey, how can we help people? We had the YouTube event and all these people excited about YouTube, then a lot of people kind of waiting and seeing what's going to happen. So we thought how do we help people take advantage of the opportunities that are there now because costs were lower, but also help them overcome any hurdles they have to creating content and things like that? How do we develop what we call our AMP plan, or accelerated marketing portfolio, which is really just a way that we look at how do your campaigns work together as a portfolio or how do they work together in concert? Rather than thinking about your campaigns as silos. Because YouTube works better when there's search and shopping and remarketing in place too, and they all kind of feed each other. So we've created these AMP plans that help you maximize your total return.

Brett:

So we want to help people now. We want to help people do that now. We want to help you take advantage of these low costs on YouTube. So we came up with kind of a stimulus package so let's kind of talk that through Chris. One of the first things you want to do is request a strategy session. You want to talk about that? Because you're the one that they're going to be talking to most likely in that initial strategy session. What do you do there usually?

Chris B:

Yeah, it's very simple. You just go to omgcommerce.com. Most all the pages have a free strategy session link. You click that link, fill out the information. That'll give us a good high level information on what we're looking at, what your challenges are. My assistant Aransa will reach out, maybe with some additional followup questions if needed. Get a time scheduled on our mutual calendars. And a lot of people are like, "Oh, so am I going to get a pitch here or whatever?" No. You're not. You're going to get a strategy session where we talk about your brand and your metrics and your data that you look at. And we primarily figure out is there an avenue where we can help you accomplish your objectives? And if so, then we'll figure out a way to move forward. So that's how you request a strategy session.

Brett:

Yep. And those are super helpful. We've gotten tremendous feedback. People love getting on strategy sessions with you Chris. And certainly we'd love to work with you, love to find a way to work with you, but when we can't we're transparent about that. And you'll walk away with good tips and good ideas regardless. If you then sign up for services in April and May ... So you decide hey, I do want to get started, I do want to run YouTube in April or May, then we want to help you with video production. So we are not a creative shop in the sense we don't have on staff videographers and editors and things like that. But we have a close relationship with multiple creative shops. And so what we're doing is we've created part of our stimulus plan, and depending on kind of the levels ... And it's going to be a minimum of $500 for you to use towards production, but it could be quite a bit more. Basically we want to eliminate that hurdle of can I get some assets that are ready for YouTube.

Brett:

And if you already have video you're running on Facebook or Instagram and you already have customer testimonials, then this package could be great for you because likely, we can take your existing products or your existing videos, we can edit that into a video that's just going to do really, really well on YouTube and we can cover the cost or at least most of the cost of production for you. So that's included right now and we want help you dominate. We want to help you take those steps to get past the competition, take advantage of the lower cost, take advantage of the increased eyeballs that are on YouTube and on Amazon and on Google. And so, we have the same offer as it pertains to Amazon. So if you're looking at ... Haven't even done YouTube but would love sponsored brand video, then we can help there as well and we can help provide some free video production credits to get that first sponsored brand video created on Amazon.

Brett:

And I'm telling you now is the time to do sponsored brand video because not very many people are doing it. Those ads are still new and they're still intriguing to people, and they just work. So we'd love to help you whether you're on Amazon, off Amazon, or both, and try to make this truly a win-win. Check it out. Go to omgcommerce.com and request that free strategy session, or download those guides.

Brett:

Why don't we do this Chris, we can stick around for a few more minutes. Or at least I can stay for another 10 minutes or so. Let's maybe open up this up to questions. What questions do people have right now that we could potentially help with?

Chris B:

Yeah, there was a question here Brett. What are some of the best practices for creating custom intent audiences on YouTube?

Brett:

Yeah. Custom intent audiences. I'll explain those for folks that don't know. Basically what you're doing is you're creating an audience, a list of people, based on what they're searching for on Google. If you think about it, I know for me, what I search for on YouTube is different than what I search for on YouTube. And so you can build an audience of people that are searching for immune support or elderberry, or whatever. Some other supplements or health related things. People that are searching for that on Google, you can build an audience of those people and then target them the next time they're on YouTube. What's interesting is, just like with a lot of things, whether it's Google or Amazon or YouTube or whatever, things are changing. Just about six months ago the advice from Google was hey, load up your audiences with tons and tons of keywords. So we need like 100 or 200 keywords in this custom intent audience. That has shifted. And we saw some of that as we were doing it. We're like man, some of these audiences just aren't working. Now the advice is more like 15. So 15 keywords and match type does not matter.

Brett:

So think about these all more like broad or phrase at least match type. But you do want to theme your audiences. So let's say that I'm selling ... Give me a product Chris. Just pick a product.

Chris B:

We'll use Canyon coolers. Dave just chimed in in the chat.

Brett:

Awesome. So let's look at coolers. We're saying hey, I want to reach people that are in the market for coolers. So the first thing I would do is I would look at, if you're running search and shopping, what are the top non-branded keywords that are converting? So people that are looking for things like high end coolers, high impact cooler ... Whatever. I don't even know all the keywords, but keywords specific to coolers. They're looking for those on Google. So we're going to build an audience of those people, target them the next time they're on YouTube. I would then look at, okay, now what if I just want to find people that are in the right category? So people that are like, best places to canoe. So think about things like that. Maybe looking at someone who's likely to buy my product. They're maybe not shopping for it, but they're likely to buy it. So then you're looking for people that are searching for activities related to my product or service. But start with those non-converting search terms. Actually the second audience I would build then would be your competitors.

Brett:

So build an audience of people that are searching for your competitors on Google, target them on YouTube as well. So those are kind of some of the first audiences I would try. And what we found with custom intent audiences, as we're kind of waiting for other questions to come in, is they often convert very well. They're not always the biggest audiences so we can't find as much scale there as we can in other places sometimes. But usually they're good converting audiences.

Brett:

Any other questions there Chris?

Chris B:

I have not seen any others pop up in the question box so I think we're good.

Brett:

Cool. All right guys, well hey, thank you so much for taking the time. I know your time is valuable. We would love to help. Please reach out for that strategy session or grab these free resources. Or if you know somebody that needs help with any of this, we're happy to chat with them as well. And so with that, Chris, thanks for hopping on man. Great to co-host with you as always. And thanks everyone for joining in.

Episode 115

:

Eamon Kelly - Edgewater Research

How Retail is Shifting Amid COVID-19

Supply chain, lock down, store closures, falling ad costs, rising costs of sanitation…just a few of the areas impacting retail and e-commerc

Supply chain, lock down, store closures, falling ad costs, rising costs of sanitation…just a few of the areas impacting retail and e-commerce right now. In my interview with Eamon Kelly of Edgewater Research we talk about the following hot topics to recent data points.

How ad costs are impacted on Amazon, Facebook and Google during the crisis
What categories are seeing spikes vs. dips in sales…there are a few surprising areas here plus some opportunities for companies to pivot.
What major retailers like Dick’s sporting goods are seeing
How retailers like Chewys are experience both growth and interesting shifts in costs and increased margin pressure
How to think about inventory levels with more shopping shifting online

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Connect with Guest:

Eamon Kelly - Senior Research Analyst and Partner at Edgewater Research

Edgewater Research

Jason & Scot Show Podcast

Mentioned in this episode:

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Episode Transcript

Brett:

Well,hello, and welcome to another edition of the E-Commerce Evolutionpodcast. I'm your host, Brett Curry, CEO of OMG Commerce. Today,we're giving you an update on E-commerce, supply chain, Amazon, someother big retailers. And we've got a very interesting guest on, andhis company does a lot of research. They've got their finger on thepulse of what a lot of major retailers are doing and what they'reexperiencing right now. And so this is going to be kind of theCOVID-19 update. Things you need to know as it pertains to retail andE-commerce.

Brett:

Letme tell you a little bit about my guest before I welcome him on theshow. Eamon Kelly is a partner at Edgewater Research, and EdgewaterResearch is a fascinating company. They really serve the investmentcommunity. They analyze different retail companies to providedetailed analysis for the investment community. They are networkingand speaking with hundreds of different manufacturers. They'redigging into things like supply chain and inventory and sales andprofits. Really just a wealth of information.

Brett:

So,we've got some great data we're going to look at for Amazon and forsome other major retailers. I think this is all information that canhelp us and inform us, as we try to make our own decisions of howwe're going to navigate the waters of retail in a COVID-19 world.

Brett:

Sowith that, Eamon, thanks for taking the time, man. Really appreciateyou coming on the show.

Eamon:

Yeah,no, thanks for having me. Looking forward to it. You know, as youmentioned, it's certainly an interesting time with COVID and theimpacts. From our perspective, the daily and weekly changes thatwe're seeing across the landscape, an interesting perspective offollowing some of these retailers that have closed shops. Whetherit's somebody like a Dick's Sporting Goods or Bed, Bath, and Beyond,or ULTA Beauty.

Eamon:

Thensome of these other ones that have benefited in closed shops, like aBest Buy, and seeing the perspective of retailers that have bothbenefited and been negatively impacted. It's just been a fascinatinglast couple weeks.

Brett:

Itreally has. Some things, I mean, some things are kind of obvious. Youknow, hey, orders are up on Amazon. Well, that's no surprise. Peopleare at home, and they still want to shop, and they still have thingsthey have to buy. But some of the other things, like some of thebenefits of which categories are up, or the areas where there's toomuch of a good thing. Now, Amazon's shifting gears.

Brett:

So,we'll talk through some of those details. But definitely aninteresting time. It is changing on the daily. I think it's one ofthose things where we're trying to do at OMG Commerce as a digitalagency is, we're still trying to have a long term mindset andapproach, and just knowing, hey, the industry, the E-commerceindustry is going to come out ahead. You know, I think stronger thanmost other industries.

Brett:

Butwho knows what that looks like, or when, exactly? But still then,focusing a lot on the short term, because man, things can change acrazy amount from day to day. Let's dive in a little bit. Let's talk,I want to talk a little bit about a subject that is very near anddear to our heart at OMG Commerce. It's what we deal with, and that'sdigital ad costs.

Brett:

So,this is fascinating. You know, digital ad costs have been on the risefor years. You know, we're on a, we're proud of this. We're on a 10year run of economic growth, and the emergence of direct to consumerbrands, and you know, increased competition on Google and Facebookand other digital ad platforms. So the cost of digital ads has beenon the rise, year in, year out, for quite some time.

Brett:

Whathave you guys been seeing in your research? And then we'll talk aboutanecdotally what we're seeing with our clients. You know, we serveabout 84, 85 E-commerce brands. But what are you guys seeing as faras digital ad costs right now?

Eamon:

Yeah,sure. I think, and you know, we have an interesting perspective withwhat me and my team do on Amazon and some of the other retailers,along with, you know, our digital team that focuses on a lot of thosedigital ad platforms.

Eamon:

It'sbeen pretty interesting. It's consistent across both of ourverticals, where for the most part, over the last several weeks we'reseeing CGC declines in the 20, 25% range. Certainly there's some thatare higher, and some that are lower. I think on Amazon, the, youknow, one of the big drivers is a lot of the third parties havepulled back. You know, they've had their FBA buy box restricted.

Eamon:

Amazon'sreally focused on the essentials, and as a result to that, you have alot of third parties that are pulling back on advertising. You know,you also have a lot of these big essential categories that, theydon't have product to sell. Without product to sell, you're not goingto advertise. So it's just been really interesting across thesevarious categories, seeing the ebbs and flows of these dollars movingin and out.

Eamon:

ThenI look at some of the digital channels, and the benefit for somebodylike Amazon is, they're not in the travel business.

Brett:

Right.

Eamon:

..lots of these other categories, they're not in the hospitality sidethat are really seeing big falloffs. You know, they don't have a tonaround, you know, the Olympics. And March Madness, and MLB. You know,you look at a lot of sports, and there's just tons of dollars outthere that traditionally go to those guys. Amazon doesn't play inthat realm yet. They're seeing similar type declines to what we'reseeing at the Facebooks, the Twitters, the Snapchats of the world.

Brett:

Yeah,super interesting. So I'll chime in on kind of both of those areas.Let's talk Amazon first. So we have a large Amazon ad division at OMGCommerce, and we serve sellers and vendors on the platform, managingpaid search and video ads and display ads. And it is interesting, youknow. We'll talk about this in a minute. But there are somecategories on Amazon that have just gone through the roof. So,essentials, certain supplements. We have a client that sells arts andcrafts, and then things like that for kids. Just exploding. A lot ofthose categories are up two to five X, you know, right now because ofthe environment that we're in.

Brett:

So,then you run into some issues where Amazon's not taking new inventoryinto their fulfillment centers for some of these categories, so theycan focus on essentials. And they're delaying ship times, and so, orwe have clients just burning through inventory. So all of that canlead to a slowdown in ad spend. You know, we've had some clients thathave successfully pivoted to now FBM, you know, fulfill by merchant,instead of just FBA. So, that's helped.

Brett:

Butoverall, yeah, it's, you're either down in sales, and so that'scausing a little bit of a decline in ad spend. Or you may be sellingalmost too much, and so that can result in a decrease in ad spend. Westill have a few clients who are spending more, just because there'sopportunities and you know, just room to push and things like that.

Brett:

Butit does make sense globally, ad spend on Amazon has probably taken ahit. So, that's been interesting.

Brett:

We'lllook at some of the other platforms. So, Facebook, you know, Twitter,Snapchat, YouTube, Google. We focus more on the Google and theYouTube side of the equation, not as much on Facebook. We're hearingthings, though, from people that advertise on Facebook, some of thesportings good. One friend of mine who's in the sporting goodbusiness E-commerce, he's seeing his CPMs on Facebook down 43% rightnow. So that's a lot, obviously.

Brett:

We'reseeing with YouTube, you know, from reports that we hear from otherlarge advertisers to, you know, our several dozen clients on YouTube,falling in line with what you're talking about. You know, that 20 25%drop, up to 30% drop. It does depend, right? Because now we're usingGoogle and Facebook smart bid algorithm to try to optimize forconversions.

Brett:

So,there's still going to be these little pockets where there's going tobe advertise that are competitively going after the same audience,and so costs aren't dropping as much. But safe to say, costs aredown. If it makes sense for your business right now to advertise andgo after new customers, ad costs are down, so big opportunitiesthere.

Eamon:

Itwas actually interesting, you know, Chewy was kind of the firstretailer that we had that reported earnings. You know, they made acomment last night that, you know, they're certainly seeing declinesfrom an advertising side. When asked, "What are you going to dowith the savings you've seen from a marketing side?" Theircomment was, "Well, we don't know how these cohorts are."

Eamon:

Arewe going to have to spend more to keep these customers over time? Itwas something that we just hadn't, you know, we hadn't really thoughtabout a ton. It was a perfectly fair point. You're having thesecustomers shift to E-commerce, and you know, why we, while we thinkthere is going to be a big shift, their point is like, we don't knowhow sticky this customer is going to be. How much are we going tohave to spend to keep them?

Eamon:

Arewe paying to acquire this customer that's really just a one-time useon this platform, or what's the lifetime value going to be? For them,you know, they said they look at it, they won't really know forprobably six months to see what that is.

Brett:

tosee those specifics, yeah.

Eamon:

Yeah,that's the challenge, I think, that a lot of these, you know, whetherit's retailers or brands, or you know, anybody spending is, you know,just looking at these dynamics that people just have not been throughin the past.

Brett:

Right.Yeah, and what's interesting. So, I get to hear an interview with aguy from Deloitte on one of my favorite podcasts, so shout out to theJason and Scott Show. I highly recommend that podcast. But he wastalking about, you know, as we look at, as they look at recessionsover history and looking at the retail sector, consumer buying andthings like that, is that consumers will adopt new behavior during arecession that they will keep even when the economy turns.

Brett:

Soas an example, you know, after the great recession you had peoplereally go, or during the great recession, you had people shopping atdiscount retail stores. So your TJ Maxx's, your Marshall's, thingslike that.

Eamon:

Yeah.

Brett:

Lotof people stuck with that, even as the economy changed a little bit.Those retailers continue to grow. I think we're going to find, and toChewy's point, we won't really know for six months or so. But I thinka lot of the people now that are shifting their behavior right now,when they're in, you know, at the time of this recording, still inquarantine, lockdown type mode, that, some of those behaviors aregoing to stick.

Eamon:

Right.

Brett:

NowI've got my Chewy's account set up. I've got some things that I canjust automatically reorder, easily reorder. Some of those behaviorsare going to stick. I think it's smart, and of course this, you know,makes sense. I'm a digital ad guy, so I'm going to be, I'm going tothink this way. But I think you look at companies in history thathave pressed on the gas in a strategic way during a downturn, duringa recession and gained a lot of market share. And so I think thosethat are in the position to do that can really come out ahead.

Eamon:

Yeah,I think, you know, we've obviously seen no surprise to anybody, a bigshift in E-commerce the last couple years. I think as you look at theway we think about it is, yeah, it's just, it's an acceleration thatis going to accelerate even faster coming out of this. You're goingto have people that, you know, whether it's you've shopped Amazon butnot other places, you'll just get comfortable shopping. The olderdemographic probably is going to get more comfortable shopping, andgoing to try out more avenues that you hadn't before.

Eamon:

Thestruggle, I think, for a lot of the brick and mortar retailers is,you're going to see a shift from brick and mortar to E-tail, and evenif they keep those customers, it's coming at a lower margin. So, youknow, it-

Brett:

That'sinteresting.

Eamon:

Iwas going to say, as they're keeping their stores open, it's not likethey're closing stores and able to offset, you know, the lowermargin. They all have these overheads that they have to run from abrick and mortar standpoint. And coming at a significantly lowermargin, you know, is going to create challenges. That's why you'vehad somebody like Walmart, who's been a lot more focused on OGP,outlying grocery pickup, and less focused on the dot com side,because they see the margin pressure that occurs on the ... deliveryside.

Brett:

Itreally makes sense. I mean, they're, you know, you could get intotopic on grocery wars, which would be interesting. I know Amazon iswith the acquisition of Whole Foods, and some of the Amazon Go storesand things like that, they're all trying to establish a foothold inthat space.

Brett:

Ido think Walmart's going to really emerge as the winner from thissituation. I just know from our own behavior and from others, I mean,the Walmart delivery, Walmart pickup, I mean, that's just super,super convenient. Almost a necessity right now for a lot of people. Ithink that's going to shift a lot of behavior to that, which isinteresting.

Eamon:

Yeah,and I think, I was going to say, with that I think you're going toalso have, you know, let's not underestimate the number ofbankruptcies that we're going to see. You know, from the retailcommunity that occurs, and the longer this goes on, the higherlikelihood that we have, you know, a lot of those pop up.

Brett:

Yep,yep. And so, to a couple of your earlier points that I want tohighlight, it's been interesting. You know, Amazon has certainlygotten a lot of volume, and they're going to emerge a winner fromthis as well, of course. But they've almost, you know, like we talkedabout, they've gotten so much focus on essentials and things liketoilet paper and all this stuff that people can't find in retailstores, that they've had to delay incoming shipments and shipments tocustomers for other products. We've seen this ...

Brett:

I'lljust give you a quick example. One of our clients that's a supplementcompany, done very well on Amazon, primarily in Amazon Business, butthey have their own store off Amazon. We can very clearly see thenumbers, so we manage their Google ads and their Amazon ads. Butthere was a week when there was real inventory issues on Amazon, andtheir sales spiked. I mean, exploded on their own dot com.

Brett:

Ithink what you're seeing there is, while yes, there are more shopperson Amazon, as Amazon has issues with these ship times or delayed,people are also saying, "Well, I'm going to search for thoseproducts on Google now." So maybe a product search that I wasgoing to, would have began on Amazon, I'm going to start on Googlenow. And I'm going to find a retailer that will ship it to me direct.

Eamon:

Yeah,I think you're absolutely right. I just had a conversation earlierthis afternoon with somebody who made exactly that point. Amazon'sput their stuff on, you know, over a month delivery times. Let's behonest, at this time right now, nobody's searching for something thatthey want to wait for a month. There's a reason buying somethingright now. So, you know, yeah. You started on Amazon, and you wentoff. That example, you know, seeing huge, huge, huge increases at notonly Walmart but all of the other, you know, all of the otherretailers that they deal with that have, you know, that are stillopen or that have even just dot com sides of the business there.

Brett:

Yup.And I think this has been one of those things where we'rerecommending to people, hey, maximize your search efforts, whetherthat's with search ads and Google shopping ads, or SCO for organicsearch. But there will be people that ... I have a client in theexercise, the home workout space. They've been doing well. As you canimagine, nobody's going to the gym, everybody's got to work out athome. They were selling a lot on Amazon, but again, now Amazon'sdelaying shipments four to six weeks. Well, I want to work out now.

Brett:

So,fortunately, they've been doing FBM and some other things. They wereable to kind of pivot. But yeah, I think there's going to be peoplethat are forced to buy online, and Amazon isn't going to be the onlyone that's going to go, you're going to go to some individualretailers as well, which is exciting.

Eamon:

Sure.

Brett:

Now,one thing I want to talk about is, you know, what are you guys seeingin terms of what categories on Amazon are we seeing the biggest liftsin? And some of these are going to be not surprising at all. Let'slook at that, and then I want to circle back to something, the coststructure. Kind of the unforeseen costs that are popping into this.We'll get into that in a minute.

Brett:

Whatcategories are you guys seeing exploding on Amazon right now?

Eamon:

Yeah,I think you said it. I mean, it's the obvious , right? I think as welook through this, there's been an evolution of, you know, the firstones of the masks and the sanitizers are kind of the no-brainers.Quickly evolved to the, to anything in the cleaning side.

Eamon:

Ithink you mentioned earlier, supplements. Perfect example. So, as welook, it's certainly a lot of the ... consumables and anythingfood-related. Seeing huge spikes in that. Prime Now is past a week, aweek out, in many cases two weeks. You can't even set anything up.

Eamon:

So,they're seeing huge increases there.

Brett:

We'vegot some friends in the prepackaged snack space, and it's like,that's a great time to be in the prepackaged snacks space. Even ifyour snack's not popular, people are probably going to buy it.

Eamon:

Yeah.

Brett:

Youknow, protein bars, whatever they can get their hands on. People arebuying.

Eamon:

Right.Yup. Then I think the other one is, you've seen a big one here in thelast two, three weeks, as businesses have been forced to have peoplework from home. It's all of the traditional work from homecategories, whether it's, you know, we're seeing it in officefurniture, laptops, PCs, and all the PC related accessories. Thoseare seeing big spikes.

Eamon:

Thehealth and beauty side, to the point before, supplements, cough,cold, things like that. Also seeing in storage containers, as peoplepantry load. Adding it there, you know. The one that I was surprisedat first, but when I started to see improvements in appliances, thatsomebody like, somewhere like a Best Buy, I kind of question myself.Like, what do you mean, why are people buying appliances? You know,as I went in to a local store, I kind of got a quick reason whyeverybody was buying spare refrigerators to put in their garage, orbuying deep freezers.

Eamon:

Youknow, I think what you're seeing now over the last, call it twoweeks, you're starting to see some of the more Midwest, northeastregions getting a little bit warmer, you're seeing tools, lawn andgarden, and some of the outdoor categories.

Eamon:

Ithink arts and crafts and toys, and those sort of categories areseeing some nice improvement, as people look to keep their kids busyand give them something to do. So, those are some of the examples ofones where we've seen some nice acceleration.

Eamon:

Ithink that the flip side of that has been, you know, what is reallystruggling. There's probably a couple where we've seen the biggestdeclines. I would say soft lines are probably by far the biggeststruggle. You know, whether you're talking apparel-

Brett:

Clothingand accessories and things like that.

Eamon:

Yeah,apparel and footwear. You know, from a business perspective, nobody'shaving meetings anymore.

Brett:

goto meetings in my slippers. Or barefoot.

Eamon:

Exactly.So, you know, it's that. Then, the other part is sporting goods. Abig piece of sporting goods, and what Dick's Sporting Goods does, forinstance, is team sports. Without team sports, I can go out and throwthe ball around with my kids, but you know, there's no team sportsgoing on. Those are some of the examples of ones where we've seenfalloffs.

Eamon:

We'vealso seen a big falloff in the automotive aftermarket category. So,we follow Advance Auto and Auto Zone and O'Reilly, and the lastcouple weeks there we're seeing probably 40 to 50% type declines,because it's no shocker. Nobody's on the road. You're not driving, soyou're not having breakage to your car.

Eamon:

So,those are some of the categories where we're seeing kind of thewinners and losers, if you will.

Brett:

Really,really interesting. I think what's fascinating about this is asE-commerce business owners, we need to think about, how could myproduct potentially be consumed more in this work from home, stay athome economy for however much longer this will last? At the time ofour recording, at least 30 days, maybe 60 days or more for parts ofthe country.

Brett:

So,how can my product be used in those areas? I'll touch on, I want totouch on both sporting goods and auto, for a second. Because this isinteresting. On the sporting goods side of things, totally makessense. Anybody that relies on team sports, hurting right now. Becauseteam sports are doing nothing, right? I coach my son's basketballteam. This was my last year to coach, and then the season endedabruptly. Now all spring and summer sports are either on hold orpostponed, or canceled.

Brett:

Butwe have a few clients that are in the training space, and so one's inthe baseball space. At-home training equipment. They're actuallydoing good, because now it's like, hey, Junior still wants to develophis swing, or Suzie wants to develop her fast pitch softball pitchingstyle, and stuff like that.

Brett:

So,some of those at-home things are working. We had an at-homebasketball training company. They're doing really well. But yeah,your traditional retailers that rely on team sports, definitelyhurting.

Brett:

Theautomotive side, it is interesting. I think there are certain pocketswhere, let's take a more affluent customer. We have a client in theauto space that sells a non-essential for auto, but they kind ofcater to a slightly more affluent. Like, you wouldn't buy thisproduct unless you had a classic car, sports car, a nice car typething.

Brett:

They'redoing really well right now. I think what's driving this is, peopleare at home, thinking about their nice car. Right? They're maybe notout driving, but they're tinkering with it or whatever. But I think,yeah, you look at brake pads, oil change stuff. Your standardO'Reilly, Auto Zone type of thing. We happened to get out last night,just to drive around with the kids and go to a drive-thru because wehadn't been out of the house in so long. Seven pm, it was like it wasmidnight. Just weren't many people out, so it was really weird. Itwas really weird.

Brett:

So,makes sense that auto would be down.

Brett:

Let'stalk about somebody, I think this was a fascinating thing you broughtup earlier. So, you know, E-commerce is seeing an influx of orders.But then there's also some of these, I don't know if unforeseen isthe right word, but these costs that aren't necessarily normallyassociated with E-commerce. Or costs that are normally associatedwith E-commerce, but they're just exaggerated right now.

Brett:

Whatare some of the cost pressures that people are dealing with now, thatthey weren't dealing with before?

Eamon:

Yeah,I think there's a couple things. I think the first one would be theobvious one that I touched on a little bit for the brick and mortars.It's just the shift from brick and mortars to dot com, and there'sobviously an added shipping cost. That's the obvious one.

Eamon:

Buttake somebody like Amazon, and you have the amount of and cleaningthat's needed to be done in these warehouses and facilities, to keeppeople safe. That's certainly a higher cost that they never had inthe past.

Eamon:

You'rehaving to see more hiring of workers. Both Amazon and Chewy both haveadded, or are adding lots of employees to help on the fulfillmentside. So, added costs from that perspective. I think with a lot ofthis, a lot of the fulfillment centers are full. Shipping, you'rehaving some higher shipping costs from trying to expedite and getthings to customers, to hit your promised deadlines.

Eamon:

Ithink that's the biggest thing I see for a lot of these retailers. Idon't care if something shows up in five days. Amazon kind of did itto themselves, right? They've strained people to focus on two dayshipping, to one day.

Brett:

Right,right.

Eamon:

Now,yeah, I go and there's a lot of stuff, like, I don't care if it comesin five days. I think what consumers want is transparency of, tell mewhen it's going to come.

Brett:

Right.

Eamon:

Atleast get that date, you know. If it's seven days, I'm at leastcomfortable. But I'm going to buy that product, knowing it's going toshow up in seven days. But it better show up there in seven days.Don't come in 10. 10, just quote me 10 days, and I'll be happy.

Brett:

Yup.Yeah, exactly. Yes, really, really interesting times now for sure.Other things you're seeing from large retailers right now, andanything interesting in your research that could be helpful for theE-commerce community to be aware of?

Eamon:

Yeah,I just think it's, I think the biggest challenge and the biggestquestion that I've had from manufacturers is, how do I go aboutfiguring out when my products going to slow? When ... are theretailers going to open? When are all of a sudden people going tostop buying certain products?

Eamon:

Youknow, you look, and pantry load is slowing. Some of that is hard togauge. Is it slowing because there's no toilet paper listed on Amazonanymore? But trying to figure out when that change is going to occuris going to be a very challenging one. I had a conversation lastnight with somebody looking in the consumer electronics space, andsaid, "Hey, I have all these people calling me, looking for thisproduct or that product. How do I figure out how much to pull in, andI don't want to be the last person shipping stuff, because I might beselling ... My normal run rate might be a hundred widgets a day. Now,I'm doing 500 widgets a day. Well, if I bring in a couple weeks ofinventory, that's a couple months of inventory in a normalizedenvironment."

Brett:

Right,right.

Eamon:

makesure and take advantage of the situation and these opportunities, yetreduce my risk on the back end? So, I think that's the biggeststruggle. I don't know that I have an answer of trying to predictwhen these certain categories are.

Eamon:

ButI think it's, the majority of people are taking a somewhat cautiousapproach of making sure that they're not pulling in too much. I thinkthe other challenge is, you know, an interesting conversation I hadwith somebody today said, "I'm seeing orders, because one of mybigger competitors is in a state where they're not allowed toproduce."

Brett:

Wow.

Eamon:

Asthat competitor, or as those competitors get back on board at somepoint in time, I know that my business is going to see a significantstep down. predict that? Very challenging.

Brett:

Yup.Yup. Yeah, it's super interesting. I mean, you know, when you, it'sboth a blessing and a curse, right, when more orders come online. Andnow you're selling at a much higher run rate. It's exciting, makespredicting inventory levels super challenging.

Brett:

You'vegot, we'll just take toilet paper as an example because it's kind ofan interesting and a fun one. You know, that's going to slow down,right? There's only so much toilet paper you can stockpile. It's notlike our consumption is actually going up. We're not using moretoilet ... Maybe we're using more toilet paper at home than we do atthe office or whatever.

Brett:

Butglobally, the use of toilet ... We're not eating it. same, so that'sgoing to slow down. Eventually there's going to be a real slow down.It's just kind of a shifting in demand of toilet paper. There areother things that are increasing. So now maybe we are buying morepackaged foods and snacks, and we're sitting around eating oursupplies or whatever.

Brett:

Butpredicting that is super tricky. I think, but I think a couple thingsthat do work in the favor of retail, and you mentioned this. I thinkfor the most part, people are going to be a little bit moreunderstanding about slightly longer ship times. You know, what choicedo we have? We're all kind of being understanding. We're all kind ofin this together type of thing.

Brett:

So,I think maybe being slightly more conservative with inventory levelsis pretty smart. I think, but the other thing you've got to keep inmind is, being opportunistic, right? We've got some really strongbrands that we work with, that are going to run out of inventory in afew areas. There may be a few weeks' gap where they're out ofinventory. I'm not going to mention who they are, because I don'twant the competitors to swoop in. But you got to be watching yourcompetitor levels, seeing when your competitor may run out ofinventory of something. You'd be able to pounce on that and take thatopportunity.

Brett:

So,with that, you got to have inventory to be able to do that. Right?So, it's a tricky game right now. I think the best we can do is lookat managed costs as wisely as we can. But don't slow down, becausethere is a shift in buyers to E-commerce. Try to capture as much ofthat as you can, reasonably. Have those long term goals, but thenalso be willing to pivot, because you're going to have to pivot a lotand pretty quickly.

Eamon:

Yeah,I think the other thing, too, as you think about it, is coming out ofthis, there's, one may think, "Well, as soon as my localrestaurant opens up, I want to get out of my house."

Brett:

Absolutely.

Eamon:

Thechallenge is, you think about is, if this lasts for three months, alot of restaurants aren't going to have any usable food. The supply,you think about all the issues that we've seen at the retail level,right? People went to Costco and grocers, and all the shelves wereempty. Well, the same thing's going to happen for the restaurantcommunity and food service when that gets back online. There's goingto be a massive flow of orders that are wanting to go that way, andis there going to be the availability? We're probably going to have asimilar to what we're seeing at the consumer side, right? We'reprobably going to have a couple month window where it takes time fora lot of that stuff to get back in stock from a restaurantperspective.

Brett:

Yeah,supply chains are kind of wonky everywhere, right? So it's going tocause some disruptions. Maybe you're going to be at your favoriterestaurant, one of these days, right? If, hard to even imagine thatright now.

Eamon:

Yeah.

Brett:

Butwe're going to be there one day, and yeah, maybe they won't havecertain dishes because they're having supply chain issues as well.So, super interesting.

Brett:

Well,Eamon, this has been really interesting, very fascinating. I'mthankful for companies like you that have your finger on the pulse ofwhat's going on and can provide this meaningful data that can atleast get us thinking and processing and looking for opportunities,and looking for ways we can improve our business.

Brett:

Ifsomeone wants to plug in more and maybe kind of dig into someEdgewater Research, how can they get in touch? How can they learnmore about you guys?

Eamon:

Sure.Our website is Edgewater Research dot com. If anybody wants to emailme, it's Eamon at Edgewater RC dot com. E-A-M-O-N at Edgewater RC dotcom. Happy to have a conversation with anybody, and plug in withanybody looking for some support and help on, whether it's Amazon orjust kind of retail in general.

Brett:

Awesome.Really appreciate it. I will link to your site and share your email,if you're cool with it, on the show notes. So, we'll allow people toconnect with you as they'd like to. But been super interesting,Eamon. Thanks for the time. Thanks for coming on. Really enjoyed it.

Eamon:

Thanksa lot, Brett.

Brett:

Yup,absolutely. And as always, we would love to hear from you, ourlisteners. We would love that review on iTunes. That helps out theshow. It helps other people discover the show. So, if you feel soinclined, leave that five star review. Leave some feedback. We'd loveto hear from you.

Brett:

Withthat, until next time, thank you for listening.

Brett:

Allright, man, that's a wrap. That was perfect.

‍

Episode 114

:

Ryan & Andrew Beltran - Original Grain Watches

Building a Lasting Brand and Marketing in a Crisis

Original Grain has an origin story that’s as cool as it’s products…and as cool as it’s founders.

Original Grain has an origin story that’s as cool as it’s products…and as cool as it’s founders. In this interview we tackle some critically important topics for all DTC brands. We discuss building a product that has an authentic story that resonates. We look at the Original Grain approach to sourcing and designing that next winning product. We hear the Original Grain example of launching successful kickstarter campaigns, and we talk about marketing during a crisis and much more.

Brother’s Ryan and Andrew Beltran grew up playing basketball together and starting businesses together from painting houses to mowing lawns. In 2013 while living in Hong Kong, Ryan had the idea for wood and steel watches. The brothers took that inspiration and started what is now a leader in the watch and accessories space.

Here’s a look at what you’ll learn in this episode:

How a chance meeting at a nearly failed event lead to their most successful watch line to date
How wooing an investor (I love this story - and it embodies the entrepreneur’s spirit) led to some of their most popular collector’s edition watches
How Original Grain is going up-stream while strengthening it’s core watch offerings
How they plan to market and stay strong during the COVID-19 storm
How to build an authentic voice and truly connect with customers even when being together physically is impossible
What’s ahead for Original Grain

‍

Connect with Guests:

Ryan Beltran - Co-Founder at Original Grain, Inc.

Andrew Beltran - Co-Founder at Original Grain, Inc.

Original Grain - The Premier Maker of Wood & Steel Watches

‍

Mention in this episode:

Everlane - Modern Basics. Radical Transparency.

Episode Transcript

Brett:

Well, hello, and welcome to another edition of the eCommerce Evolution Podcast. I'm your host. Brett Curry, CEO of OMG Commerce. Today, I have a treat for you. We are going to hear just a fantastic eCommerce brand story. I've got two co-founders of an amazing company on the show today. These are guys that I know. I know their product and their company intimately. We actually help the with some of their marketing, so I've gotten to know them over the years. I'm just delighted that you'll get to hear behind the scenes of their story. Lots of lessons that you can learn. I think you'll be inspired for maybe your next evolution as a company. So, all kinds of good stuff.

Brett:

Hey, Brett Curry here. Before we dive into today's topic, I want to talk quickly about YouTube ads. People ask me all the time, what makes for a great YouTube ad? It's true, the ad is the hardest part for getting YouTube to work. Now, I love the campaign structure. I love audience targeting and I love tinkering with bids and using the smart bid algorithm, and I even like budget management. I like all that behind the scenes stuff. But I've seen it time and time again, where the exact same campaign structure, just limps along with a mediocre video. But you get the right video with the right message, that resonates with people, and that same campaign structure just takes off. It scales.

Brett:

Over the last couple of years, my team and I, we've been collecting good YouTube ads. We've been watching, we've been paying attention and looking at our own clients, looking at the numbers, finding what are ads that resonate and work on YouTube? So, we started building this little guy. This little guy that we use internally. We started categorizing ads and giving them fun names like The Manifesto and the UGC Mashup, and the Have It All. We started breaking down what elements in these videos make them work?

Brett:

I was speaking at a recent event, and I just happened to mention that this resource existed, and people started clamoring for it. Everybody was like, "Hey, I want to see what we got. I want to see that resource. I want to see all these successful ads." So, that's what we've done. We put together this resource first time ever. We're going to share it with a broader audience. It's free. Check it out and get our list of winning YouTube ad formulas, with lots of examples. Let this be your inspiration for your next killer YouTube ad.

Brett:

So, this is a free resource. We'll link to it in the show notes to this show, but you can also go to omgcommerce.com. Click on resources and then guides, and it's the YouTube ad templates and guide. Check it out and I hope it inspires your next killer YouTube ad campaign. Now, back to the show. I would like to welcome to the show co-founders of Original Grain Watches, Andrew and Ryan Beltran. Ryan and Andrew, how's it going fellas?

Andrew:

Hey.

Ryan:

Yeah.

Andrew:

Hell of an introduction. I like it.

Brett:

Yeah. I'm really excited to have you guys. In all sincerity, I am a fanboy of the watches. We can talk about specifics later. I own a watch, my son owns a watch. We are big, big fans. So, lots we can dive into. I think it would be interesting to hear the story of how you guy got started, and we'll also talk about what's going on in the world today. Because as we record this, I think we're all in Coronavirus lockdown.

Ryan:

Yeah. We're in the thick of it here. Yeah.

Brett:

This is interesting times, so I there's some things we can talk about to help folks navigate the waters right now. If you would guys, tell us the origin story. Why start a watch company? You guys started in 2013, correct?

Ryan:

Yeah, 2013. We actually launched with a kick-starter through crowdfunding but well, we're brothers, so I guess the story starts back in 1991, when Andrew was born. We're two years apart.

Brett:

Two years. So you're the older, wiser brother. Is that right Ryan?

Ryan:

Yeah, I'm the older, wiser. Andrew got the looks and the height, so I don't know. You've got to get something here.

Brett:

Andrew's showing the profile, showing the beard. That's amazing. So, seriously though, but as you guys were growing up, did you talk about being in business together? Did you guys have a lemonade stand or something like that?

Andrew:

Yeah. I was talking about this last night. We had a few of those small businesses as kids, whether it was mowing lawns or even power washing houses.

Brett:

business. The lawn mowing business.

Andrew:

Every summer we were painting houses and working together. We were a tandem. We always did everything together. Ryan always led the charge. I was always hanging out with the older kids so I felt cool. But yeah, we would play ball together. Grew up playing sports. Coming from a small town in Oregon, there wasn't this whole, "Okay, we're going to launch a global watch company." We did envision, growing up, raising families together, so it was a natural evolution, I think, as we grew up.

Brett:

It's amazing. I love the service based industry. It's a great business to get started on, mowing lawns as a kid. My son did, to build some revenue. Pure cash business. You said you played ball together. I'm just curious. I'm into sports as well. What kind of ball did you play?

Andrew:

It was basketball growing up. Our step dad coached us and then I played on Ryan's team all the way till high school, and then we had some glory days there. High School. Some good news articles, Beltran brothers lead the way.

Brett:

Is that right?

Andrew:

Yeah.

Ryan:

Yeah.

Brett:

state appearances and stuff like that?

Ryan:

Yeah.

Andrew:

Yeah. Yeah.

Brett:

No kidding. I did not know this about you. I've got to watch myself because if I'm not careful, we'll do just a basketball podcast.

Ryan:

Xs and Os, and we're talking about and back cuts.

Brett:

Exactly. I played in high school. I was at your level, I don't think, but I played and then I actually coach my son's basketball team.

Ryan:

That's nice.

Brett:

Varsity team. It was really intense. Last two years I coached. It was a lot of fun. Basketball is a huge part of our life as well.

Ryan:

That's awesome.

Brett:

Cool. You guys mowed lawns, painted houses, wanted to raise a family together. Walk us through, where did this idea for a global watch company, where did that come from?

Ryan:

Yeah. That one, fast forward to like 20 years actually, on the dot ... I never start with the 1991 thing. That was a new thing for this show, but I like it.

Brett:

I like it.

Ryan:

I'm going to use it.

Brett:

You heard it here first. Okay.

Ryan:

Yeah. Actually, in 2011, I moved to Hong Kong, Southern China, really actually Mainland after I graduated college. Went to University of Oregon in our hometown, we did, and decided that I wanted to try this entrepreneurial thing for real, start a brand, and I knew that majority of products were made in China. I felt like it was like a scene from Blow, go to the source, but not for that, for product. I'm like, "Let's just see what happens." I spent three years on the ground there, and about a year into that stay, I came across a product, which was a wood watch, and I thought, "Oh, this is really cool. It's different." It reminded me of home, growing up in the Northwest, the wood thing. But, "This can be a lot better. How can I innovate on this a little better?" Thought, "Why not just incorporate wood as a material, rather than just get ... " Felt a little gimmicky to me, a wood watch-

Brett:

A fully wood watch. Yeah. I've felt some fully wood watches and they do feel a little gimmicky. They don't feel very weight or very real.

Ryan:

Yeah. A trendy product more so, than something there to stay. That's how the idea sparked. Andrew, I'll let you take the next part of it because it was really interesting how it happened. He was coming through on a deployment and ..

Andrew:

Okay. It's like a little bit acts of fate launched this whole thing. After high school, I joined marine corps. I was actually on the way home from a deployment, and we had two days to stop in Hong Kong. At that time, Ryan had just been to the Canton Fair, which is one of the biggest trade shows in the world.

Brett:

I would love to go. It's on my bucket list. I've not been but I definitely will at some point.

Ryan:

Got to go.

Andrew:

Yeah. When I showed up, he was really excited. He has showed me a prototype of something that we could do, and right away I was initially just totally attracted to the watch. It definitely reminded me of home in the Northwest where we grew up. Just that wood heritage and craftsmanship, and I knew right away that was something I loved and he loved it as well. But he needed some cash to get started. Ryan, you might want to jump in. You tell that story pretty-

Ryan:

I was like, "Hey little brother. You've got some extra cash?" He actually did, he was in the marines. He had been on deployment. You don't spend any money.

Brett:

You don't have to pay taxes. Cool stuff like that.

Ryan:

We were both back home that summer. I think he stopped in May and June and July, that summer, 2012, so out there. I came home. We met up. We were out on the lake. We were talking, "Let's do this thing. Can I get eight or 10 grand? I think it was eight grand actually. That was what it was." We bought a first load round of ... We were going to place a PO and a few months later I go, "What if we were to launch a Kickstarter?" He's like, "What's a Kickstarter?" He's like, "What's a kick starter?" I go, "It's this new platform, it's crowd-funding. People back your project." It was new. It was becoming a thing. It was a little bit of right time, right place there. We decided that's how we were going to launch. So we threw it up on Kickstarter and 30 days later, we had raised 390 grand.

Brett:

That's crazy.

Ryan:

It was like, "It looks like we got a business."

Brett:

Yeah. So, two quick things. One, describe the watches. I know we talked about it a little bit, but describe the watch and/or show one if you have one, for those that are watching the video. Okay. Andrew, which one is that? Is that the

Andrew:

This is our new Whiskey Barrel Line actually.

Brett:

Whiskey Barrel, yeah.

Andrew:

We redesigned this collection, integrating wood in steel, as always. Reclaimed materials is our best selling collections, which has that heritage. Whether it's Whiskey Barrels, reclaimed craft beer. We do some military ammunition crates. We also have a line of MLB watches reclaimed from old baseball bats, or even stadium surplus, where we've taken wood from the 1923 Yankee Stadium chairs.

Brett:

Amazing. So cool.

Andrew:

A lot of limited edition batch runs, and then we're able to price accordingly, to a limited edition, or just the mechanics of the watch.

Brett:

Love it. Ryan, what are you wearing right now?

Ryan:

I'm rocking one of our automatics. This our game master line.

Brett:

That's the new design.

Ryan:

Yeah.

Brett:

Inspired by Italian sports cars? Do I have that right?

Ryan:

It's the DT40. Our recent hire, well, he's been with us for about a year now. He's our lead watch designer. He's from Detroit. He's working on our first line. We want it to be a little higher end. This one starts at like 600, and this automatic version goes for like 850. We wanted to do something that was inspired by automotive. He's from Detroit, right? Was inspired from the GT40, which is an iconic race car. Ford versus Ferrari, that movie that just came out based on that.

Brett:

Amazing movie. Amazing movie. Yeah.

Ryan:

Great. I love it. Actually, the real watch is so good, but, yeah.

Brett:

I wanted to say as a side not now, obviously no one can visit now because of lockdown, but you guys have an amazing little showroom. Obviously an online business, but amazing little showroom, and your offices there in San Diego are fantastic. The coolest vibe. You've got nitro brewed coffee on tap, you've got the watches out. I don't know if it's your motorcycle, or somebody on the team's motorcycle, but is there a story behind that motorcycle that's in the office? Because that is just rad.

Andrew:

That motorcycle is now being crashed, but-

Ryan:

It actually has.

Andrew:

It's try on. It's a beautiful bike. It looks vintage, but it's fairly new actually, but it's

Brett:

Okay, yeah. I thought it was vintage.

Ryan:

It's pretty rad, yeah.

Andrew:

We have a few paintings. Louis Vuitton's board and . It's that new age office space. Very open and a little warehouse, so definitely a lot of wood accents. It definitely represents our brand really well and everyone enjoys coming into work, which is what we want.

Brett:

Yeah. Awesome. So, people have a picture of the watch, and if they're watching the videos, they've seen the watches. So, the Kickstarter, what did you do? Because you started with, "Hey, let's see if we can figure out how to make this work with $8,000, then you pivoted to Kickstarter and you got $390,000. Why did you get so much? Why did it work?

Ryan:

I think, and Andrew, chime in after I go, but I think a lot of it, and I've always said this, was just the uniqueness of the product. It was a right time, right place moment, in terms of the platform, and the fact that we were actually featured on the home page for the entirety of the campaign, more or less, which in this day and age, doesn't happen. Actually, I don't even think Kickstarter would allow that. But the way ours had worked, and the way that our campaign was trending, it was just there. We got a lot of organic traffic, but look, there's always a little element of luck, if you will. But I think a lot of it's just our ability to take that risk and build something that was new.

Ryan:

The authenticity, I know that's a buzz word, but of the story was there, and I think Andrew and I did a good job of explaining why this product ... What's inspiration. The design, like I said, was definitely unique, and we're selling a quality product, for a decent amount of price at the time on Kickstarter. So, I think that had a lot to do with what led to the success of the campaign.

Andrew:

For sure. I'll try to add to it because that was our first campaign, and then we followed it up with a second campaign that actually did a little bit better. During the campaign, we struggled a little bit to ... Being competitive, we needed to beat the first campaign, even though , but we had to. We really started understanding digital advertising and driving traffic to the campaign, because we weren't getting that organic traffic from the home page. We were getting certain features. We have little spikes, but how are we going to contain consistent flow of traffic?

Andrew:

Which I do recommend a lot of first time entrepreneurs. It's nice to start on a platform like that because you really can cover your bases and your model without going out and blowing a ton of money. It allows you operationally, getting control of everything that's happening. All the customer service, all the flows and the macros that you need to build about, bouncing around a little bit. But that was what was unique about the second campaign. It felt like we really had something that we could sustain outside of this Kickstarter platform-

Ryan:

Yeah, through paid traffic.

Brett:

Primarily Facebook ads, at that time, I would assume?

Ryan:

Yeah.

Brett:

Did you guys rely heavily on a video telling the story of the product? Was that the main piece on Kickstarter?

Andrew:

Yeah.

Ryan:

Yeah.

Andrew:

It's funny because our first video, Ryan actually shot, cut, and edited the whole thing.

Ryan:

Beautiful.

Andrew:

And then second time around, we had a professional come in and do their thing. That's when really, we took our content to the next level as well. Started hiring out some creatives on the team. One of our first hires took the brand to the next level, visually.

Brett:

Nice. You hinted at this a little bit, Andrew. You talked about a few things. But let's talk about the reclaimed wood aspect of the watch. Was that an idea from the very beginning? Ryan, you talked about wood and steel, and mixing these, and not just this gimmicky feeling, just all wood watch, but wood and steel. Was the idea, from the beginning, to use reclaimed wood, or did that evolve later?

Andrew:

You want to take that up Ryan?

Ryan:

Sure. Yeah. To be totally honest, I don't think we had thought about reclaimed wood. I think initially, we were thinking exotic, unique, rare, hard woods. Obviously sustainable woods. There's a lot of woods that we figured out through the process that they can't find because they're so rare, or you can't source because they're the endangered species, like a Brazilian Rosewood for example. Extremely endangered. You can't get it, nor would we. But with anything, once you start, and you start to go down the path, and you start looking at different materials, Andrew and I think, pretty early on, I would say about six to eight months into it, we started looking at what would be other cool wood materials be?

Ryan:

We're actually starting to expand into other non wood natural materials, grain. It doesn't have to be just wood. We're going to look at that, so we can dive into that a little bit as well. The first one, we've been thinking about reclaimed Whiskey Barrels. I actually was at this trade show, It's Magic, in Las Vegas. I always tell the story for a couple of reasons. But one of the biggest reasons is because you never know what's going to come of an opportunity. So, for all the entrepreneurs out there, myself included, sometimes you put yourselves in these positions where you're like, "Man, this sucks."

Ryan:

We were at this trade show for three days. We got like two retail ... This is year one, right? We got a lot of our posters on the wall and a handful of walk-in boxes of watches. We didn't know what we were doing. Levis meanwhile's across the way and they've got like $100,000 billed out in lucky jeans. We were like, "Okay. This is how you do it." We didn't know. We got a few clients , and it was day three, and Andrew and I were like, "This is a waste of time and money. What was the deal?" This guy walks buy and he represented Jim Beam Whiskey, and he was like, "I really think we should do something together, because this is cool. Have you ever thought about reclaiming whiskey barrels?" We were like, "Well, actually, we have." And he goes, "Let's do something." That gave us that push to, "Well, if Jim Beam is interested in this, then that's pretty cool."

Brett:

brand is coming to us and saying, "Let's do a deal," that's a real proof of concept there. Yeah.

Ryan:

Yeah. That's how initially it was catalyst for the reclaim thing, and then ... I don't know Andrew, if you've got anything more to add, but it's definitely just sparked this whole wave of unique cool, interesting reclaimed material.

Andrew:

Yeah. It's the most fun to market. It's the most fun to go out and find as well, and gather up your resources, and get behind. The whole team gets really stoked when we're ... Recently, we were working on a new pilot. Not that this was going to be the source that we use, but we had to find some materials, just to even work with our suppliers. Our design is driving up to LA on this dirt road. It's an experience in itself, to find some of these materials. It's what gets you out of the bed in the morning. It's like, "Okay, what can we create?"

Brett:

Yeah. It's really what gets people excited about the product as well. I want to talk about some of the other reclaimed wood aspects in a minute. But I want to touch on something you just said Ryan. I think this applies to any business, right? Whether it's eCommerce, or we run a service based business, an agency. I can't underscore enough live events or just being with your customer, or with other people in the industry. Because if we look at some of the breakthroughs we've had as an agency, they've always almost come at events, because of people we've met, ideas that were sparked, something we saw. There's something about that physical event. When you're there, you see things. The rest of the world is shut out. It's just magical. Even if you show up at an event and you're being outdone by Levis and lucky jeans, if you're open, you'll still probably get an idea or two, that can be absolute gold for your business.

Ryan:

I love that. I've always been a huge believer in just showing up. I think that's a Mark Twain quote or something about it, because 90% of life is just..

Brett:

Just showing up. Showing up and having an open mind. Yeah. Cool. The whiskey barrel collection, which Andrew's sporting right now, right? You've got the Whiskey Barrel?

Andrew:

Yeah.

Brett:

So cool. There's something raw ad powerful about a whiskey barrel. It's something you'd want to wear and then tell people about. You know, there are some watches you wear and you're like, "It's just a watch." But that, you want to talk about. I actually own the Koa wood watch. It's black. That's why I got it, because I wanted a black watch. I didn't have one. Talk through some of the woods, and what's been successful, and any lesson there. And anything that you tried, that wasn't successful. I think sometimes there are lessons there. But then I also want to talk about your collectors pieces in a minute too.

Ryan:

For sure. Andrew, you want to take it?

Andrew:

Yeah, I can jump in regards to some of the best sellers. We touched on it before, but definitely the reclaimed materials. Things that have unique stories. The whole Hawaiian Koa, that's our tribute piece to Hawaii. We've done some unique things with the wood, but as well with the steel. That's a stone wash steel, which that's new to the market. That's something we essentially created. That's supposed to embody the lava rocks of Hawaii. So it's got that stone accent on the steel.

Andrew:

The different other materials, whether it be the military, I would say that's been a fun collection. Obviously I'm really tied to that one, considering my service, but that was something we learned on, I would say. Although a very unique collection, we offered a ton of styles. There was five styles when we originally launched with different leather bands. One was gold, one was stone wash. One was reclaimed from a pilot jacket.

Brett:

Interesting. The leather band was from a bomber jacket?

Andrew:

Yeah. It came with the watch. With the steel band, we had additional leather band. It was just a lot to communicate to the customer, rather than just triggering in, "This is our pilot jacket. We're going to reclaim series." This is a lot of communication. Everything deserves a spot in the sun, and it was too much to describe. That was a big learning lesson. Narrowing down.

Brett:

So, the pilot watch. The reclaimed bomber jacket, that didn't do as well, maybe, as others, because of the story which maybe didn't land? It was a little too complicated?

Andrew:

I would say we learned that a few styles didn't land, but we were pretty broad.

Brett:

Got it.

Ryan:

Yeah. I think from a marketing perspective, what Andrew's saying is don't over-complicate it. Maybe hone in on ... Because consumers really can only take so much at a time.

Brett:

For sure.

Ryan:

And I totally get that. I'm that same way. It's like, "Whoa," decision paralysis or whatever. I'm like, "I just need to understand what this is." We've still been successful. We still have it in the lineup. We figured out which colorways and which stories resonated. But reclaimed, I wouldn't say obviously, but has been the most successful. Whiskey, to date, is our number one seller. It's also been around the longest. We're trying to find that next whiskey barrel. It's something we talk about in the office a lot, and something else that can even scale, from a business perspective, that maybe isn't so rare, that it just ...

Ryan:

Because the cool thing about the whiskey barrel thing, other than the fact that I do genuinely believe that it's a cool story that a lot of people resonate, but it's a relatively endless supply of the material, and it's sustainable, because we're not having to go out and cut down trees or anything. I'm not saying that we do that anyway, but the whiskey barrels, they're reclaimed from Missouri and Kentucky. They're done with the barrels, they've already aged the bourbons for four years, and they don't know what to do with them because bourbon can't go back into a used barrel. Actually, the American law says that. I think it's an old, old law from 100 years ago. So they just don't know what to do with it. They're just like, "We could sell them to France for," which is what they do a lot of the time, "or we just dispose them."

Brett:

Wow. It's sustainable. It's amazing story and it's a super cool product. Let's talk a little bit about when I was there ar your office and I saw the watch made from, and you mentioned it Andrew, the 1923 Yankee Stadium seats, and one I think from Fenway Park, potentially. Where did the idea for that come, and how did you market those? How did you make those successful?

Andrew:

I'll jump in. That's actually a beautiful story. It actually ties back to an investor relationship that we're trying to build. We actually just made him a one-off sample the Yankees. We had ordered a chair on eBay, made him a one-off sample for his birthday.

Brett:

What inspired you guys to order a chair off of eBay?

Andrew:

He was wearing Panorize every time we'd see him. He would never wear a original grain watch. But he was from New York, and so we were like, "Hey"

Brett:

So you bought the chair for this reason?

Andrew:

For this watch.

Brett:

There are some lessons there. You're going after an investor, do something crazy. Go buy a chair on eBay, from Yankee Stadium. Okay. Awesome. I'm super intrigued now.

Andrew:

We bought it, made him a one-off sample. I remember meeting him at the airport. He was literally flying to New York. Met him in the airport and gave him the watch. He was like, "What the hell?" Went home. But I think when he was sitting on the airplane, he was like, "Wow." He wrote an email and he was like, "I can't wait to hand this down to my son." I've already picked this out for my youngest. It's like, "This is-"

Brett:

For his favorite son?

Andrew:

Yeah. Time pieces are heritage. They're meant to be passed down, generationally. The fact that we could create something that had that sentimental value, it was like, "Wow, how do we tap into the emotions of the customer?" That goes along with the reclaim stories that we've created. But that's how the MLB thing had kicked off as a whole. We were just making a one-off sample and then sooner or later, now it's like a whole MLB licensing program that we have, that drops as MLB starts, and then as soon as the champion's crowned, we drop another watch. Those are those seasonal spikes we're also able to market and get in front of people at the right time.

Brett:

So were you able to get more Yankee Stadium chairs after that?

Andrew:

Actually, we found with the Cubs, but the Cubs was really hard to get more. The Yankees weren't too bad. But the sources are crazy. It requires certificate authenticity and you'll find a lot of construction guys will have them. It's interesting sourcing some of that wood. Yeah. It's always-

Ryan:

The Yankee Stadium was rebuilt in 2009 or whatever it was, so the guys who worked on the demolition would have a lot of those chairs.

Brett:

Grab a chair on your way out, on your way home man.

Ryan:

Yeah.

Brett:

That's crazy. So smart. So you took the idea. What a good entrepreneurial lesson. You're trying to find a way. How do break through the clutter? How do we get this potential investor to wear our watch and to think it's cool? You buy a chair. You make this watch. And his response is, "Holy cow. This is amazing. I'm going to give it to my son. It's so meaningful." Then you think, "Business opportunity. Let's capitalize on this one."

Ryan:

Let's scale it a little bit. Yeah.

Brett:

Yeah. And so, you guys did one for Fenway Park as well, right? Or was it-

Andrew:

It was Wrigley, and now Yankee Stadium, and then Fenway came next. Then we ended up doing reclaimed baseball bats, so that we could touch the whole MLB. So, we did a bunch of different teams. I think 14 teams last year. We have another collection coming out this year, where we're actually using Rawlings Leather. They're going to be a Leather based watch.

Brett:

For the face of the watch, we'll have the reclaimed baseball bat and then the band will be Rawlings Leather? That is freaking cool.

Ryan:

Yeah.

Brett:

Okay. That's awesome.

Andrew:

Yeah. And a collector's piece at this point, yeah.

Brett:

Yeah, cool. Any other ideas or iterations that will come from that? That seems like a great next evolution. One of the things that we talked about is we're working with your company and helping to grow it and market it, there are some people, and I would count myself in this crowd, I like watches. I would be happy to own lots and lots of watches. Is part of the motivation here, "How can we potentially sell more than one item to an individual customer?" So you have some of these collector items where, "Okay, not, maybe I've got my Whiskey Barrel watch, which is my daily watch, but I'm a huge Kansas City Royals fan, so I'm going to buy the Royals watches. Is that the motivation there, or is it more MLB is a totally different market for you?

Ryan:

Yeah. If I could take that, it's twofold. I definitely feel like the opportunity was for us to expand on the success of those three teams, the Cubs, Yankees, and the Red Sox.

Brett:

Which is the perfect ones to start with by the way. Those are the ones with the most rabid fan bases and huge markets. That was super smart.

Ryan:

We've seen, and I think if you look at licensing industry, trend reports and stuff, you see that the majority of the merchandise is sold in the big market teams. Dodgers, things like. LA. You know what I mean? And it starts to trickle down beyond that. We learned that lesson too, when we rolled out , so there are going to be a few less teams actually on this 2020 version, with..

Ryan:

I think additionally, to your point about retention and lifetime value on customers, 100%, I think that's something in the watch category that's a tougher code to crack because unlike apparel or other categories, beauty, consumable products, things like that, where they go from a t-shirt to jeans, or another color, it's a little more affordable to begin with, the beauty, the consumable. A lot of people like to collect watches from multiple different brands. But if we can suck them into our brand, and we have a pretty good ... We're above 20%, I think, on repeat purchase.

Brett:

Which for your category, is outstanding.

Ryan:

I think it's pretty good. Yeah. Finding more ways, to your point Brett, on how to increase LTV, is I think something we're looking pretty hard at right now, because we've got a pretty good base. Right now in particular, with the COVID, that seems like probably the best place to go right now, honestly.

Brett:

I 100% agree. I'm in a couple of different mastermind groups. Shout out to Ezra Firestone and Blue Ribbon, and also the guys at War Room, Ryan , and Ronald Fraser, but we've had several meetings lately just talking about how do we handle the COVID-19 scare? How are we marketing? A couple of things for people to keep in mind. One, there's still a lot of consumers out there that are doing just fine financially, and they want to buy something. So, shopping is therapeutic.

Brett:

Buying something, and in your case, your product is a great gift item. Buying a gift for my spouse, that makes me feel good. Don't just be quiet because you think you should be. People want to buy stuff. You want to feel normal as much as they can right now, to a larger degree. Reach out to your customers. Do something unique. Do something special. Offer discounts to help people out. Stuff like that. Do you want to talk about anything you guys are doing now, that's relevant?

Ryan:

Andrew, do you want to take that? We actually just had our leadership call with out team right before this, at 11:00. Yeah, Andrew.

Andrew:

Yeah. We've been coming up with a lot of creative ways on how to connect with the audience, and it starts with customer care at this point. That's top of mind. How you're going to represent yourself during COVID is what people are going to, and this isn't factual, but I believe it's how people are potentially going to remember you beyond COVID. I'm not trying to take advantage of people by any means. We're going to start inviting people into our own house. We're going to be doing live interactions here, product demonstrations, potentially Zoom meetings as well, similar to this. Bringing people closer, Bringing in the family. Customer care. Setting expectations through emails, handwritten letters, all that's so important.

Andrew:

There's a lot of confusion out there. Are people shipping? Are they not? Am I going to get my watch? Setting the expectation I think is probably one of the most important things, and then just relating on a real level. Humanizing has always been important. I think now more than ever. Just being comfortable with uncertain times. It's crazy. We went through this as a nation, but it's important. I love seeing people get creative by doing Instagram lives and inviting people in, so we're going to be doing a ton of that for the next few weeks.

Brett:

I'm really excited about a lot of that and I want to hear a little more about it. I think it's really important, if you can keep in mind that one, people need that connection now more than ever, they want it from a brand too. If you've got this authentic, cool, brand, you can still connect with someone in a meaningful way. As we approach as marketers, as business people, as leaders, as entrepreneurs, if we're confident in the face of crisis, that does spill over. That creates a net positive impact. Yes, it's scary. Yes, there's bad things going on, but we will make it through, right? I think eCommerce will be better for it in the long run, and then some other things that are positive. So, you want to talk any more about the events and stuff that you're doing Ryan? That sounded really cool. Like Instagram lives and ... So you're going to do that from your houses obviously?

Ryan:

Yeah. Like I said, we were both at the opposite, six feet away, yesterday.

Brett:

You're brothers.

Ryan:

We're brothers. Taylor, our VP, you know Taylor, she was like, "I want you guys to do these lives, but you guys can't be together." I go, "Well, actually, we're together right now." She's like, "Okay, well, that worked." We'll see. I mean, whether we are or not, I'm super excited about doing that. I've seen a lot of brands that I consider leaders in the industry for eCommerce, like an Everlane for example, they just do such a good job as a whole. Their whole thing is about transparency.

Ryan:

They want to be transparent through this. We've been seeing what people are doing and we're like, "Man, we were already planning to," but it's been really cool to see those brands do that. So, yeah, I'm excited about it. I think it's a good reminder, this whole thing, to not get back to basics, but remember some of those things that sometimes just start to fade. I'm not saying that our customers ever did, but yeah, I'm excited about tapping into that, for sure.

Brett:

It's interesting, there's also been this ... I've heard a few people mention this. We've come off of so many great years in a row. Some of us can get fat and happy. I don't think it was happening a lot. You guys were hungry, where hungry, but you can get comfortable with things. This is really forcing us to say, "Okay, we got our game. We've got to connect in a way we've never connected before." I think that's leading to some good changes.

Brett:

One thing I will mention, this is advice that I give all the time, is if you want to see what people are doing right now, and good markers, you mentioned Everlane, Ezra Firestone, that's another good one, you know those email lists. Go follow them on Instagram. Follow them on Facebook. See what they do. Do the same with you guys. If you guys are getting ready to do some cool stuff, go to originalgrain.com. Sign up on the email list so you can get notified of stuff they're doing. Follow these guys on Instagram. Actually, do you want to talk about some of the ways people can connect with you?

Andrew:

Yeah. Our social is @originalgrain. Our website, originalgrain.com. As you mentioned, we're sending out emails every couple of days and providing updates, whether on new products, as well as just the virtual live demonstrations that we're going to be doing, so you can sign up for those and be in the know.

Brett:

I think you guys do so many things well. Your video content is great. We're running some of your videos on YouTube and they're doing well. There's a lot that someone can learn by checking out what you guys are doing. Maybe a couple of things here, as we're running up against time a little bit. But Ryan, you're showing the automatic watch, and that's a higher price point. Your standard watches are in the $300-$400 ranger. The collectors watches I know are more. You said the automatic you have there is 850. Was that strategic in ... Obviously I know everything you do has a strategy behind it, but were you thinking, again, just raising the LTV? Expanding into new markets? What was the thought process behind that?

Ryan:

Yeah. I think one thing we've always played in that $250-$400 range since we launched. What we didn't want to do was race to the bottom, where it feels like a lot of the GTC or ... I want to say BTC. That's not right. But the more entry level products, regardless of being direct consumer or , or whatever, are doing. We want to stick to our guns, which is hard to do sometimes. I mean, let me tell you. We run promotions and discounts, and all that, but I think, at least on a MSRP level, we didn't want to just start rolling out watches at 150 bucks, and put ourselves down there. I think it was strategic to move up a little bit.

Ryan:

We have a lot of watches coming out in that $250 to $400 range this year, right where our bread and butter is. But when we hired Scott a year ago, he helped us map out and created this little matrix of where we are in terms of style. We didn't have a pilot watch. Andrew talked about that. We wanted to do a pilot, but where it is that fit in terms of price point ... If you chart it out, you see where there are some holes to fill. I think from a merchandising perspective, it rounds you out and it allows the customer to see a little more breadth. As all marketers know, sometimes seeing a $400 watch paired against an $800 watch makes that $400 watch look more affordable.

Brett:

Absolutely.

Ryan:

There's some strategy there for sure. I mean, our $850 automatic is the same value in terms of the build and the movement, it being a Swiss automatic, so we price that right. Yeah. I think that's how we've looked at our product roadmap.

Brett:

I love that. There is definitely something to be said, I think. I know some of the merchants that do this, where they create some really high prices offerings almost with the primary goal of creating less resistance for their core offer, right?

Ryan:

Sure.

Brett:

For you guys, it sounds like digital watches, it's a great offer. It's a fantastic watch, but it's also, and you mentioned it, it's going to make your core product feel more and be perceived more as more valuable. That's awesome.

Ryan:

Yeah. 100%. Yeah.

Brett:

Cool.

Ryan:

We're doing a lot in terms of refreshing watches this year too, so taking some of our own bestsellers, which is a little scary. and I laugh sometimes. We're like, "Because you've got this good thing going, you don't want to ... If it isn't broke, don't fix it." But we just believe in product at the end of the day. I've always been a product is king guy, and I just want our product to always get better. If we can do that, we're going to do it. Andrew and I are aligned on that. So, we want to raise the tide on that new barrel line that he's wearing. Number one selling watch. We changed it. It still pays homage to the original design but it's a better product. It's risky. Yeah.

Brett:

Given the insights on what you do, any time you're innovating and creating, and making something brand new, it's risky. It's risky like, "Will the market embrace this?" You guys talked about in the military line, where something was maybe to complex and in land, and others did. How do you guys approach that product design piece? Do you get a lot of feedback along the way, from a lot of different people, or is it more like you're just bringing in your artists, like your version of Johnny I've from Apple, like you guys are making him doing it? What does that look like?

Andrew:

I'll jump in a little bit. I know Ryan's super involved as well, with the product design. Ryan and I had our own method about two years ago, and then as soon as we hired on Scott or head designer now, the process has changed so much, and it's been beautiful to next to him, to really understand how someone approaches a design. He doesn't just jump in and start drawing. He's pulling in so much inspiration amongst the community. What is the reason for this watch? Whether it fits in certain buckets, and bringing in examples of different collections that embody that.

Andrew:

It's a 3D printing different sizes. 3D print in four different sizes, check before it even goes to the supplier. That's sped up some of our production lead time. The amount of back and forth between samples. To really work side by side with a real designer has definitely changed the came for us because our approach before was fairly ... Ryan and I designed a watch on a train ride, on the way to a supplier, and that's a real story.

Ryan:

That's a real thing.

Andrew:

That's really .. We have that finished sample. It actually just showed up a few months ago and everyone was like, "Why don't we make this watch?

Ryan:

Ryan was like, "There's no way." It's a really retro watch that we had designed literally on-

Brett:

On a train. That's awesome.

Andrew:

It was a mess. Our process has changed a lot over the years, because we've brought in really good people around us. That goes towards our marketing process, all the way to design. That's my bid on that.

Brett:

Love it. Love it. How much are you looking for? Whatever wood, whatever design we use, the automatic is inspired by the GT iconic race car, you've got the NLB connection, Military Connection, Whiskey Barrel. How much is the potential story? How much is that influencing what you decide to build the next, did you start with story or did story evolve as you go, or what does that look like?

Ryan:

That's a good questions. I think sometimes it does vary. At times, we just look at incorporating a cool material or reclaimed material into an existing platform or silhouette. Maybe for an existing watch silhouette, we just take the material and we integrate it into that design. The design lives and it breaths and it's there. At other times, if it's a completely new ... Let's say take the pilot for example. It's a new product that's rolling out in July. We knew we wanted ... That's an aesthetic. Scott, to Andrew's point, is pulling it an inspiration. It's what he does. He's been doing it for a decade, so he understands how to approach that project, but with an OG twist on it.

Ryan:

He's looking at that first, and then how he can incorporate some sort of material element into that. For us, there's two versions. There's a one story version, and that's using the type of material, the type that planes actually were made. I mean, it was at a really cool aerospace museum here in San Diego, and we went and toured it, and it's phenomenally where all the planes were made out of wood in the 20s and 30s, and 40s I think. Imagine flying in that.

Brett:

Just sneaking part of a wing, put it in your pocket once you head out.

Ryan:

Yeah. Cut a little off. He'll find ways to incorporate that into the design, and he's looking at tolerances, because we're talking about small, thin, pieces of wood. That's a challenge, from a manufacturing perspective. He's looking at that and how thin he can go, and how ... Yeah. I think there's two ways to go about it and it all varies based on the project and what the goal is from the start.

Brett:

It seems like one thing you guys have done really well, and then maybe this will be our final topic as we wrap up, it seems like you guys are really bright dudes, and you are innovative, and you have that entrepreneurial spirit. It seems like you do something on your own, and you learn and do it, and do it well, but then at some point, you bring on somebody, like a professional designer like Scott, or you brought on some internal teams like James. Guys and girls that are awesome. Any thoughts there? Any advice that you would give to other eCommerce stores? When does it make sense to do something yourself, versus hiring expert, versus outsourcing to an expert? Any insights on that?

Andrew:

I mean, I speak for myself in this. Ryan does an amazing job managing the team on the day to day. I really love setting the foundation and expectation for wherever that task may be. Tat comes from being a founder and a little bit of founderitis, that Ryan and I both probably carry. But setting expectation, setting the platform, the SOPs and then allowing people to jump in. The challenge for myself has really just been continuing to forge forward and not managing that person ... Getting the reporting correctly. That's been something that we've had to learn along the way. It's my first business. But also just forging forward and continuing to bring in newer business or new ideas, rather than sitting back and helicoptering over somebody you've already tasked out, to do what the foundational job is.

Andrew:

That's something that I definitely struggled with, over the last year, as we built our team out, was letting go and being able to ... But Ryan and I just had this conversation, like, "Wow, we should probably have our team produce these reports for us, because we're not getting those reports unless we flog in, which you've got to let go." There's been a lot of learning lessons, I think, over this business. Understanding how to manage people, what type of reporting you want presented to you, so you can really make a fine decision. You're doing it. You're still maintaining the weeds a little bit, but you need someone to produce those reports for you. I know that's something that has been big for me the last two months.

Brett:

I love it. I love it. Any thoughts on that Ryan, in terms of managing team, bringing on experts? That evolutions?

Ryan:

I think Andrew hit the nail on the head. We were both doing different things. I think that's why it worked so well. We're looking at starting other businesses and we want to partner on those as well because we both have different strengths. Andrew's a really good operator, and he knows how to set the foundation and get shit done. He's really good at that. I can't really do a ton on ... I mean, I can, but I struggle to get that initial task stuff done. I'm thinking more like longterm, big picture. So it's a really good balance that we bring in. I think we're both good people persons, but Andrew does a really good job of that as well. But, yeah, I love to do everything, and it's a double edged sword. You laughed Brett, because it's so hard to let go. I mean, Oh my gosh.

Brett:

It is. It is, but you have to. To reach new levels, you have to let go of certain things. Learning that balance of, "How do I coach and manage, and inspect what I expect?" and things like that. It's a goal. Those are transitions, for sure, we could do a whole podcast on that.

Ryan:

Yeah.

Brett:

But I've seen your team in action. Compliments to you. You guys have built a great team, and they're operating at a high level, so that's really cool. One of the things that I'll just wrap up on my final comment about you guys is I love that you're always on a quest to make the watches better. How do we do something new? Let's not just leave the Whiskey Barrel collection as it is. How do we make the next iteration and make it better? That drive to create the next better thing. Not everything is going to work, but you're going to find things that do work, and that do resonate, and that's going to lead to long term success. So, it's so exciting.

Ryan:

No doubt.

Brett:

Cool fellas. Any other asks or anything else you'd share with people? Check out the website, sign up on social, follow these guys, see what they're doing. Any other asks or any final thoughts or comments here as we wrap up?

Ryan:

I don't think so.

Brett:

Buy a watch guys. Seriously, you'll be way cooler. Buy one for yourself, buy one for your significant other. Go get a watch. I recommend it.

Ryan:

That's a perfect plug for our next month sale. It's our seven year anniversary next month, which is crazy. We're going to be doing our founder anniversary sale. We're actually going to do some sort of buy one get one in this time, so you hit the nail on the head for that.

Brett:

Cool. Perfect. We;'ll link to the show notes.

Ryan:

Thanks man.

Brett:

Yeah. Ryan, Andrew, thanks fellas. This was a blast. I really enjoyed it.

Andrew:

Thank you man. It was awesome.

Ryan:

Yeah, thank you Brett.

Brett:

All right. Very good. Well, as always, we would love to hear from you. We would love to get that review on iTunes, if you feel so inclined. With that, until next time, thank you for listening.

‍

Episode 113

:

Roland Frasier

How to Market and Build Financial Stability During Economic Crisis

On this show investor, entrepreneur Roland Frasier and I talk about what you need to do to survive and thrive right now.

Economic Crisis - time to panic or time to press ahead? While challenging and painful, there are huge opportunities right now. Some of the world’s most successful companies grew leaps and bounds during recessions (Toyota, Kellogs and many others). On this show investor, mentor and brilliant marketer and entrepreneur Roland Frasier and I talk about what you need to do to survive and thrive right now. From getting your head right, to ensuring financial stability to how to market your product - right now. The market has shifted but money is still up for grabs. Here’s what we cover:

Understanding the physiological segments of the market and how to reach customers that are still actively buying now
How your product positioning should pivot during times of extreme uncertainty
How companies like Toyota and Kellogg’s crushed their competitors during a recession
How to secure financing right now
What to measure and how to measure to keep your head above water

‍

Roland Frasier - CEO at War Room Mastermind

War Room Mastermind

Business Lunch with Roland Frasier Podcast

Mentioned in this episode:

Traffic & Conversion Summit

DigitalMarketer

Jay Abraham’s Covid-19 Strategies: Live Q&A - Business Lunch with Roland Frasier Podcast - Episode 147

Strategic Alliances

Roland Frasier’s Facebook Page (This is where you can find the live videos)

Consumer Segmentation Study and Matrix - Harvard Business Review - “How to Market in a Downturn”

Pathmatics

SimilarWeb

Adbeat

“To Be or Not to Be Intimidated?” Book by Robert Ringer - Amazon‍

Forbes article Roland Frasier referred to

Episode Transcript

Brett:

Well hello and welcome to another edition of the eCommerce Evolution podcast. I'm your host, Brett Curry, CEO of OMG Commerce, and I am super excited about today's guest and I'm really looking forward to the topic today. It's going to be timely, it's going to be helpful, it's going to be motivational. And so my guest is really truly a legend in this space, kind of needs no introduction, but I will intro him for good measure.

Brett:

Hey, Brett Curry here. Before we dive into today's topic, I want to talk quickly about YouTube ads. People ask me all the time, what makes for a great YouTube ad? And it's true, the ad is the hardest part for getting YouTube to work. Now, I love the campaign structure. I love audience targeting and I love tinkering with bids and using the smart bid algorithm. And I even like budget management, I like all that behind the scenes stuff, but I've seen it time and time again where the exact same campaign structure just limps along with a mediocre video, but you get the right video with the right message that resonates with people and that same campaign structure just takes off, it scales.

Brett:

And so over the last couple of years, my team and I, we've been collecting good YouTube ads. We've been watching, we've been paying attention and looking at our own clients, looking at the numbers, finding what are ads that resonate and work on YouTube. And so we started building this little guide, this little guide that we use internally and we started categorizing ads and giving them fun names like the manifesto and the UGC mash up and the have it all. And so we start kind of breaking down what elements in these videos make them work.

Brett:

And so I was speaking at a recent event and I just happened to mention that this resource existed and people sort of clamored for it. Like everyone's like, "Hey, I want to see the guide, I want to see that resource, I want to see all these successful ads." And so, that's what we've done. So we put together this resource kind of first time ever, get to share it with a broader audience. It's free. So check it out and get our list of winning YouTube ad formulas with lots of examples. Let this be your inspiration for your next killer YouTube ad. So it's a free resource, we'll link to it in the show notes to this show, but you can also go to omgcommerce.com, click on resources and then guides and it's the YouTube ad templates and guide. Check it out and I hope it inspires your next killer YouTube ad campaign. And now back to the show.

Brett:

I've got the Roland Frasier on the podcast today. I was just telling Roland before the call started, he's the host of one of my favorite podcasts right now, the Business Lunch podcast. I highly recommend it. Great guests, great topics. It comes up multiple times a week. It's fantastic. You also probably know Roland from the Traffic and Conversion Summit. He's a partner in that and with Brandeis and digital marketer, also CEO of War Room, a fantastic mastermind, which is actually the reason we're doing this podcasts. This all came because of a War Room call I was on and I was like, well, we got to do an episode for eCommerce Evolution and Roland agreed to come on. And Roland is just one of those guys, just super smart and has his hand in a lot of things, knows a whole lot of things and so thrilled to have him on. And so with that Roland, man, welcome to the show and thanks for taking the time.

Roland:

Yeah man. Thanks for having me, I appreciate it.

Brett:

Yeah. So we were on, I was listening in as you and Perry Belcher were going through a War Room call, which by the way, it's times like this, he knows we're all kind of going through this crisis and figuring out what to do that things like masterminds become even more valuable, because a few weeks ago like, you could get kind of fat and lazy, things are going really well and now it's like, hey, we need these communities, like mastermind groups, so kudos.

Roland:

It is funny that in good times they're great because everybody's kind of sharing what's working and all. But then when things go a little bit the other way, it's nice to have people that you can count on and say, hey man, I'm a little concerned about this. What can I do?

Brett:

Yeah. I mean, they're good in the good times, are almost necessary in the bad times if you can swing it. So I particularly liked what you and Perry were talking about on the call. And so I think to kind of set the stage, so we're going to be talking about how do we market, how do we grow in a downturn, in a crisis? How do we navigate these waters? We'll get into a couple of different subjects that you know a lot about. But I think to start with, let's talk about mindset. So how are you approaching this crisis and how are you instructing War Room members and clients and friends? How are you instructing them to look at this crisis from a business perspective?

Roland:

I mean, it's everybody has their own reaction to things. So we can't ever instruct. We can only say, here's some things to think about, right? So the way I like to approach that is just to say, here's some things to think about. This is not an unusual thing to happen other than the way that it was precipitated, right? We're not generally big on pandemics here in the States, I don't think we've had any. But over the history of our country, I was talking to Jay Abraham the other day and he said, this has happened 48 times, in terms of recessions in the history of our country.

Roland:

And I know that for me personally, I saw as a kid, I saw the one in the 70s and then there was one in 1982s and bad things happen then. And in the 90s and then in 2000. And then the big, where they call it, the great recession, not the great depression, the recession, in 2008, 2009. So like the fact that business is cyclical is no surprise.

Brett:

It's always going to be that way. It's always been that way, it will always be that way. Really the only thing that's novel about this is the pandemic.

Roland:

Correct, right? So if we take that out and say, okay, we're going to just look at things have changed, but this is really unusual because this has been a change that probably wasn't going to happen. And I think probably won't continue once we get to open our doors again, because it's 3.2 million, I think, people filed for unemployment last week, which they said the highest before that was a 695,000 people in 1982 and 665,000 people in I think 2015. So do you remember having like giant trouble in 2015? You know, probably not. But the thing to think about is that, that's only because, it's not because like people, like business stopped. It's not because business stopped organically anyway.

Brett:

Right.

Roland:

It's because we're literally telling people you can't open your business right now, which we all know-

Brett:

Yes, stalking it around. Yeah.

Roland:

Yeah. And we all know that that can't last, but that eventually the public is going to say, you know what? If we're going to die, we're going to die. And I'm not saying that to tell people to go out and about, I'm just saying, we are not as human beings inclined to live in confinement. And if you look at all of the flatten the curve studies and all of that kind of stuff, they say, we really, if we can just, on the average I would say is three or four months of this on a bad kind of side, on a, not a worst case, but on a probable, most likely bad case as far as how long we have to stay in this kind of environment.

Roland:

Well, that's going to just ... That means that all of the demand is pent up. It didn't go away is to just, hey, we can't travel right now. We can't go into our office right now because we'll die. So I guess the first thing that I tell people is look, this is an artificial situation. And so the reality that you're in right now is not a reality that's likely to continue for any extended period of time. So the first thing then that you might think about is, can I survive from the date of today through the date when things start to return to normal, because when they start to return to normal, then you can start doing whatever it was that you were doing before. That was feeding your family and making you rich or getting you by.

Roland:

And so then if you think about that, it's like, okay, well this is kind of like, it's a weird combination of a startup, a turnaround, and a recession. In a startup we have runway, right? You say, okay, we're going to start a business, I need to fund it.

Brett:

Yep. me a long hand.

Roland:

Yeah. And I can fund it. What's my burn rate? Well, my burn rate is $10,000 a month or whatever your burn rate is, right? In a startup, my burn rate is $10,000 a month. I've got $120,000, I have a 12 month runway before I run out of capital and somewhere along that way, ideally before I hit the end of the runway, which is a brick wall for most of those startups, right? Where I don't get to continue my business anymore, I either have to make enough profit to get additional runway or I need to raise capital or borrow capital to get additional runway.

Roland:

Well, it's nothing different here in terms of your survival of your business is you have to look right now and say, what's my burn rate? What is the amount of money that's going out of my company? What is the probability of money continuing to come in, at what rate? And then you say, how much money do I have currently divided by my burn rate, my net burn rate, meaning my revenue, less my expenses. And then that tells you how many months you got. Now, if you do that and I've walked through that like ... Actually Perry too was telling me he went through this with one of our War Room members that was freaking out. They were like, "Man, everything's going to crap. I don't know what to do." And well, it turns out that they had 108 months of runway.

Brett:

That's probably going to do it. I think we will safely be out of quarantine by then.

Roland:

If we're not out of quarantine by then, we're all going back to caves and it doesn't matter.

Brett:

We're all screwed at that point and you don't have to land.

Roland:

Yeah, we're all screwed.

Brett:

It's on mad max at that point.

Roland:

Yes. So I think it's like, that's the very first thing. And then you say, okay, well what are the things that I can do to extend that runway? Well, one of the things that we talked about is can I get additional money? And the easiest way to do that right now, and particularly in the short term, if you need more money, is to go borrow it. And there are companies that will do multiple credit card applications at the same time. It's like, if you need money in the next couple of weeks, then go to one of those companies and get yourself $150,000 or so.

Roland:

Typically you can get 50 to 150, depending on your credit and that's cash. Like you just do cash advances. Now the SBA has been funded and depending on which version of the bill gets enacted, there's like, I think last time I read it was 357 billion that's going into funding small businesses and 50 billion-

Brett:

Are you going to read all versions, Roland, just so that you're ready, like all 880 pages?

Roland:

Never, no, no. I'm going to look and see what they're saying, but yeah, I never ... It's really funny how people don't understand how law works is a bill is something that is not a law until it's voted on and approved by both houses of Congress here in the United States. If you're watching from the United States or listening, and then signed by the president, and so a lot of people get all, okay, well this bill says this and this. But the chances are it's going to change quite a bit before it finally gets through.

Roland:

Now let's say that it goes through or doesn't, no matter what, there is money in the United States, in the small business administration, and they have a loan called a 7a loan that will allow you to get $350,000, that's an accelerated procedure, typically 30 to 60 days versus the four to six months it takes to get one of the bigger loans. But those bigger loans right now that they funded, the terms are two to 3% interest with a crazy year payback, right? So all of that and however that shakes out, doesn't matter. All that you need to know is the principle is go get some money, right? Go get some money and people are saying, "Well, but I don't know if I'm going to need it." You're going to need it, right? Assume that you're going to need it.

Brett:

Assume that you are going to need it so that it's available. Absolutely.

Roland:

Wouldn't it be better to have it and not need it than to need it and not have it. And even if you don't need it for your current operations or to extend your current runway, it will be helpful to acquire other businesses because not everybody is going to make this, right?

Brett:

Absolutely.

Roland:

Not everybody listens to your podcast. So I think that's the very first thing. And then the second thing that I tell people is, if you need money that is ... If you need more runway then the other way to get it is to think about your current expenses. And so this is where the startup looking at runway goes to turnaround. And in a turnaround situation, like if I go into a business to turn around, the very first thing we do is we go and we say, okay, we need a 14 day inflow outflow of cash forecast and we need to know everything that's coming in and everything that's going out. And are we net positive or negative? And then what do we have to work with? Right? So it's a kind of a proactive version of the runway.

Roland:

Now, I know that at our company, and I'm talking about one of our companies that we go through at Digital Marketer, we'll find every quarter, 20, $30,000 a month of stuff that we're not using anymore. That we either got and said yeah, this is super cool tool. We're going to do this at some point, we never did. This is super cool, we're going to use it. It doesn't work. It's like ... So there's just so much fat that is typically, that has kind of built up when times are good, you're not motivated to get around to it. You've got other things you'd rather go out and make $100,000 than save 15, right? And that's actually smart. So that's the next thing is doing that cashflow analysis. Do a 14 day cash analysis and then do a 90 day week by week. So your 14 days is day by day. Your 12 weeks is week by week after that, and that probably is going to get you through what we're looking at right now.

Brett:

I don't think so.

Roland:

Yeah. And then you go-

Brett:

Especially for eCommerce, because I think one thing to keep in mind, and I know that the degree to which people are experiencing pain in the eCommerce industry does vary pretty wildly based on what they're selling. But we have a lot of clients right now. I ran a report a couple of days ago, like 60% of the clients in OMG are actually growing, even through this downturn because some consume, consumer shopping is shifting online and there's still some goods and in categories that are down, no doubt about it. But I would agree with you, I think if you have that 12 week plan, hopefully things will kind of begin to turn. And I think eCommerce is going to come out better than most from things experienced.

Roland:

It should. Yeah. I think the only, like your biggest risk is somebody like Amazon, if you're really dependent on Amazon and they say yeah, we're not taking that anymore.

Brett:

Right.

Roland:

It's like, really, you're just not taking it anymore?

Brett:

And that's been crazy. We've been dealing, so we have kind of our Google and YouTube side of our business, and then the Amazon side of our business. And our top sellers, almost all of them have been scrambling as of late because either, well, Amazon's not taking their shipments into the Amazon fulfillment centers, but now Amazon's saying, we won't even ship your goods. If we have it, if we have it on hand, we're not shipping it to customers until end of April or May, and it keeps getting delayed. So it's forcing Amazon sellers to say, well, I'll just do fulfilled by merchant then. And that's actually a good move in a lot of ways. So again, it's like painful. It's causing people to scramble. They're losing some sales right now, but it's forcing them to diversify and it's actually could be a good thing in the long run.

Roland:

Yeah. Now what I don't know, and you probably do is, is Amazon moving? If you've got goods there, will they move that to your other ... I mean, you're just locked. They've locked down. They've got your property, right?

Brett:

Yep. That kind of sucks. Yeah. So if you've got your access to anything, at least that's my understanding.

Roland:

They're probably going to be some lawsuits that they're going to have to deal with then, because-

Brett:

It could be.

Roland:

... If they cannot give you access to your property and they can claim force majeure, but like to get actual access to it, would be interesting to see what happens with that. I bet there's going to be some, there probably some attorneys right now going yeah, keep it.

Brett:

Exactly. Coming for you Bezos, coming after you. Yeah, exactly. So the 12 week plan, I think that's going to get a lot of people through. I'll let you continue there.

Roland:

Oh yeah. So then you look and say, okay, well what can I do to accelerate the inflows of income and it's been fun to watch all of the different things that people are doing on the marketing side. Right now, I'm just talking about the finance side. And on the finance side it's okay, can I, if I've got accounts receivable, which a lot of people that are selling online don't have accounts receivable, but if you do, then can you offer people a discount to pay sooner? Are there things that you can do to accelerate payments in any way? Can you do bulk or discount or bundle or anything else that encourages people to pay sooner as opposed to paying later or, to dis-incentivize people or to incentivize people to act now as opposed to putting off. And so you see a lot of people doing that. And even Warren Buffet said, "One of my favorite things during the time of recession is to buy durable goods because you've got risk."

Brett:

I love that, so smart.

Roland:

Yeah, right? He's like, look, if a couch that I was thinking about buying is 50% off right now, and I save $1,000 on it, and then I invest that at 12% for 40 years, that's worth $50,000 or something ridiculous to that.

Brett:

Yeah, exactly.

Roland:

I love the way that guy thinks. And so if we think like that, and I'd probably be using that if I was selling durable goods, I'd probably say, why don't you follow the Warren Buffet sale or something like that.

Brett:

That's brilliant, it's brilliant. I love it, yeah.

Roland:

So that, like all of those things with finance to me are the things that will help us stay because it's the people who have the cash to be able to survive pass what we call the survival line, right? Whenever this phenomenon ends, are the people who are going to be positioned to grow the fastest and get ahead the most. So that's, like that's finance advice and I can go through the other stuff, but it's kind of long. So I don't know if you want to do that.

Brett:

No, that's perfect. And then let's talk about a few elements of what we just covered and then get into some marketing topics as well. But I love this because, and we always want to be sensitive to what's going on and there's a lot of pain, there's anxiety, there's fear. All those things I think are perfectly normal and justifiable, but I think as leaders and entrepreneurs, we have to pull ourselves together and get our heads right and see this for what it is. And I had a call with a friend of mine today, he's an eCommerce merchant, sells on Amazon, but sells through his on websites and stuff. He's like, "I don't know, man. I'm just, I'm seeing this as an opportunity." Like it's just, it's an opportunity.

Roland:

It's an opportunity.

Brett:

My sales are up, because he sells an item that people can use at home and especially kids that are bored can use at home. And so he's selling like gangbusters. He'd already started some of his fulfilled by merchant activities, so he's able to pivot and use that. So he's seeing it as an opportunity. And I remember hearing several people even just a few months ago saying, right now the best advice is sit on cash because the economy's so good and then you're looking for opportunities when the next recession comes. I don't think anybody thought it would be like as soon as it is or happened the way it did.

Roland:

Next to me.

Brett:

Yeah. But if you do have a good cash position and you can make it through that survival line, like you talked about, there's big opportunities, like there's huge opportunities. Yeah.

Roland:

Absolutely.

Brett:

And so let's maybe ... I want to mention something else too, just because I'm a huge fan of this guy. You mentioned Jay Abraham. You guys did a ... Did you guys do a Facebook live together recently?

Roland:

We did, yeah.

Brett:

Is that available globally or is that like to a select group?

Roland:

No, it is. We're doing everything right now that we have that would normally be part of a group or something like that, we're doing open to the public. As a matter of fact, Jay and I just started a thing called the Strategic Alliance where we are basically providing question and answer type stuff for entrepreneurs. And so that, we bought everybody that was on that call, the first month of it.

Brett:

Nice.

Roland:

And it's kind of fun. Yeah.

Brett:

Awesome.

Roland:

So we're just answering questions and it's kind of fun to have him who, I remember when Tony Robbins was a client of mine, when I was practicing law, I got a letter from Tony that was a Jay Abraham letter about this, it might've even been a Mr. X thing.

Brett:

I remember that, yeah.

Roland:

And it was $500 for the book. And I was like, "Oh man, $500." And I bought it, I was like, "Ooh, this is great." So it's kind of fun to have the opportunity to work with Jay now and do stuff together.

Brett:

It's very cool.

Roland:

Yeah, and if anybody goes to ... You can go to my Facebook feed and just search for Jay Abraham and it should come up in there. I think it was Monday. Right?

Brett:

Okay. And I'll link to it in the show notes as well so people can access it. But it's so interesting. When I was in college, my uncle kind of stumbled on the Jay Abraham. And so believe it or not, he bought a bunch of Jay Abraham stuff and sent me these cassette tapes. Now, I was in college in the early 2000s, so cassettes were old at that time. But I was like, I just devoured it. And you mentioned Strategic Alliances, like that was the part of marketing where I was like, this makes sense. I like this a lot. And so we've actually utilized that mindset to grow OMG Commerce. I've used it to grow other businesses, like it's so smart and I'm a huge Jay Abraham fan. So I'll link to that in the show notes.

Roland:

Great, yeah.

Brett:

But check out that business and that offering, it's really cool.

Roland:

And what's cool about that for everybody that's listening is we talk about, like it was just open Q and A. And so we had people from eCommerce and everything else just asking questions about, what should they do? And it was fun just giving, here's what we see working and all the different things that we have access to and here's some ideas and things like that. So it's a good place to get inspired for what you can do if you're feeling like you don't have anything that, any options right now.

Brett:

Yeah. Awesome. So let's talk about marketing a little bit, in the warm call from a week ago or early in the week whenever it was, I don't know, it's so hard to like ... My concept of time has shifted.

Roland:

It's weird when your home for like a week. Yeah, it's been, this is the second week for me, cause I know only because last Monday and Tuesday a week ago, I was supposed to have an event and on Sunday night I was sitting in the restaurant of the hotel where we were going to have the event. There was only 25 people. And was really wrestling with, I had a few people who had flown in and this was all getting ready to happen. And that was the night that they announced we're closing all the restaurants, we're closing ... Here in California. So yeah, so this is, we're coming up I think on Monday on this, the next Monday that comes after this, it will have been two weeks and it feels like it's been four.

Brett:

I know, I know. It's so funny. And I'm in Missouri and so we just went on lockdown recently and I think everything is fine in our area, but still probably smart. But it's funny, like I'll see TV commercials with large groups or people like driving down the street, like normal. I'm like, "Oh, I remember those days. I remember what life was like." It wasn't that long ago, but it just, it feels like it was.

Roland:

And now you see it, sometimes you'll see people like a press announcement or something like that and there are people all together and you're like, are you crazy? You're all going to die.

Brett:

It's funny how the new normal shifts pretty quickly. But so on this warm call, you were talking about looking at different segments of buyers and how, well, yes, there's some consumers who have freaked out. There's a lot who have not, and there's a lot of people out there that have money, that have resources and they want to still buy things. In fact, buying things is therapeutic and it makes you feel normal and people crave that right now.

Roland:

Retail therapy.

Brett:

Retail therapy, yeah. What was it that Ryan Deiss said that consumerism is like the number one hobby in America or something like that. I don't know if he just made that up or if that's like a real thing, I think it's real. Yeah. So talk a little bit about that, what is your approach and what are your thoughts about how do we continue to market in this time of uncertainty and crisis?

Roland:

Yeah, I think it's really good. I did a zoom with Rachel Miller the other day who's just a bundle of energy. I don't know if you've got to see it or not, but she was saying like when she's talking to people, she asked first, she said, "Can you sell what you sell now?" Because if you can't, like if you're a restaurant and it's closed or if you're an office and the office was closed and you couldn't go remote and you can't sell the thing because you have to deliver it in person, then that's a different kind of situation. So I liked that as an initial filter to say, can you sell what you used to be able to sell? And if you can, then can you pivot? Is it in demand? If it's not in demand, then can you pivot? And to help with that, I think that this, and I don't know the issue that I found it and I still have to go back and find it, but there was a really good consumer segmentation, study and matrix that came out in Harvard Business review.

Brett:

Yeah. I've got a link to it so I'll put it in the show notes. It came out around the great recession, so it was like 2008, 2009.

Roland:

Yeah, exactly. And so what they did was they said, let's look at consumer behavior in a recession. And they said it depends on the what type of customer, what type of consumer it is, and there were four categories you could fall into. And one was slam the brakes, which is, oh, I'm freaking out. No, I can't do anything. I've got to stop, I'm not doing anything, I'm not spending anything. And I was like, that doesn't last very long, by the way. But you've got that group of people and then they said there's a patient group of people. And these are, this is the largest swath of people who are, like they're feeling it, but they're like, okay, this is going to hurt but we're going to get through this. I'm not freaking out, I'm not hitting the panic button. Then, there were-

Brett:

I saw a quote today, it's kind of funny, maybe ties to that, that said this will pass. It may pass like a kidney stone, but it will pass.

Roland:

I like that.

Brett:

That's probably that group, yeah.

Roland:

And then there's the comfortably well-off and then the carpe diem people, the basically live for the day. Right? And depending on which of those categories you're in, you're going to have different behaviors for four different types of products. One type of product that is doing well and they did a, like a green, yellow and red shading. Green meant business as usual, no change at all. Yellow meant probably looking for deals or substitute products or to pay the same that they would have paid for more inferior product, but for a better products, effectively a discount. And then there's red. And in the 16 quadrants, if you took those four types of people down the left and the four types of products on the right at the top, there would be 16 boxes and only three of those boxes were red.

Roland:

Two of them, and red was declining sales and they were declining only in the two categories. The four categories were essentials, things that we basically need to live like toilet paper. And then there was treats and then postponables and expendables. And treats are things that we do for ourselves. Just some little reward or big reward that we'd do for ourselves, those kinds of products. Then the postponables would be like a new water heater or a car or something you don't have to have. And then expendables basically just kind of stuff you buy and probably shouldn't in the first place. And it was really funny because when you read the definition in the study between expendables and postponables, you're like, why do you have that fourth category? I think it's so that they had a four by four.

Brett:

Yeah, visually.

Roland:

But the encouraging thing is, is that the study which was based on actual buying behavior showed that the only people who were really going to hurt sales or the only areas that sales were going to decline were in expendables if you had a slam on the brakes people and pain, but patient people, they're kind of saying, one saying, hell no, we're not buying that. The other one's saying, probably not going to buy that now because it's expendable. I mean, we don't need it or want it. It's just kind of like an impulse buy. And then, the only other area for declining sales was postponables for slam on the brakes people. So that means that if you're selling essentials, that was all green, no changes, you're still going to sell it. No discount, no need to panic. No need to freak out.

Roland:

If you're selling treats, then people are looking, like I said, they're looking to substitute. So in your marketing you say, okay, what is my product a substitute for that's a more expensive product? And then lean into that, lean into the people who used to be buying. You should be knowing, like if your product is a substitute for some other product, you should identify what products is your product a substitute for and is your product less expensive than that? And then go after all the places those people are advertising, use Pathmatics or a similar web or Adbeat or any of those tools to say, okay, this is where those people are selling. And then go take their business away from them.

Roland:

If you are discounting, then lean into the discount and advertise the discount and if you're bundling or something like that, do that as well. And then also leaning into the messaging because if you're selling something that's essential, it's essential, no problem. But if you get into the next category of treats, then you're saying, okay, well this is what a lot of people want to do right now. This is the retail therapy. This is the, you know what? You're at home and you've cut back, but you deserve this.

Brett:

That's right.

Roland:

Right?

Brett:

Yeah. As for Firestone with Boom by Cindy Joseph, he sent out a fantastic email recently and it did really well. And then the whole premise was create a spa day at home, right? So one of the most helpful things, and this was legitimate that you can do right now is battle stress, right? So how do you reduce stress? Well, here's a way to get a little spa day at home, actually good for your health, good for your immune system, all that. And here's a little bundle on a discount to go with it. It was brilliant and it worked.

Roland:

And that's exactly what you would do. And that actually would be something that would appeal to all four classes of those consumers, right? So that's kind of exciting to know that that's there. Then if you have the postponables, you lean into, well, the only people who are really postponing like that, the only red in that category was the slam on the breaks people. So those people, that's just going to be a matter of time. But the rest of the people, then you go with the Warren Buffet thing, right? Now, there's never been a better time to buy.

Brett:

Right.

Roland:

This is to go with the deal, but tell them why, don't just knock it off 50%, say this is why, and this is why it makes sense to buy.

Brett:

Yeah. There's got to be a reason why. Right?

Roland:

Yes.

Brett:

I remember the old marketing lesson, there's always got to be a reason why. And it can be a really weird reason. You're like Saint Patty's day, that's the reason why or in this case it's, we're creating ... This is our own stimulus package, right? We're creating our own stimulus package for you, to help you, to ease the pain and let's go. What's interesting too, so as you look at that segment of buyers, right? And I like how the article talked about, it's no longer just like the age and gender and income because those categories you just described are really more psychological. There could be some really well off people that are still in that slam on the brakes, because that's just their nature.

Roland:

For sure. And broke people who are in the carpe diem.

Brett:

Like, screw it, man, I'm just going to have fun and I'm going to buy whatever and it's therapy and who cares? I'll fall bankrupt if I have to. So yeah, just understanding that psychology. But what's interesting, so we have a client and I can't reveal too much, but they're in the automotive space and it's really not a necessity what they sell, right? But they've got a large segment of comfortable but well off and they're still, but they're also positioned in their marketplace as more of a value. They've been doing super well. Like this is not something that's ... You do not need this right now if you're at home fighting the COVID pandemic, but they are up and they're up in quite a nice way. And I think part of it is like we're sitting at home, I'm looking at the car and the garage and I got a nice car and I'm just going to buy this thing that they sell and it's going really well.

Brett:

So I think also understanding that, like what's the mindset. If I appeal to a segment of the market that's comfortably well off and maybe I am a bit of a value, so I think that lines up with what you said before, where now maybe I'm looking for a value but I still want something that's good. It can be a great time to buy and I think it's been so interesting. I've heard from a few other merchants who are either on the War Room call or have been talking to Ezra lately that have said, I was kind of just hunkered down. Right? Because there's just some people that's their nature. Things go crazy and it's just, I'm going to hunker down.

Roland:

Worst thing you can do.

Brett:

But now they're realizing, no, I got to go for it.

Roland:

Yeah. And I think the other thing too is that, that struck me about the categories of product is can you reposition your product from expendable to essential, from postponable to treat, right? How do you ... Like the couch is a postponable. I need a new couch, but the couch is postponable, I can wait for, I'm just going to sit on my old couch. Right? But if it's, you know you're spending a lot of time at home right now and isn't it a time? Isn't that couch kind of not ... Like you've been thinking it's not really that comfortable and you're able to sit there and spend time with your kids or watch TV, catch up on Netflix and all, but the whole time you're thinking, I kind of deserve a new couch, right?

Brett:

Yeah.

Roland:

And you move it into treat or you move it into essential, well then you've opened yourself up to those other psychological categories of buyer in a recession. And that messaging alone can be a repositioning element. I think that's kind of exciting to play with.

Brett:

I love it. It's super fun. And I'll give you another example. The credit on this goes to a couple of members of my team, Jessica Muddrer and Sarah Edwards that we have a client and they sell big blankets and actually are called Big Blanket companies. So these are 10 foot by 10 foot ginormous blankets, so it's a hundred square feet.

Roland:

Nice.

Brett:

They have like Sumo wrestlers that are spokespeople and like the tallest guy in the NBA as a spokesperson. Anyways, so we were brainstorming or like, hey kids are home all over the country, extended spring break and school's going to start at some point, but how do you entertain these kids? And actually we have another client that sells the arts and crafts and stuff like that. And they're just exploded because again, trying to keep kids entertained. And so we had the idea of, hey, let's do like build the most epic blanket fort. So ads showing the big blanket as an epic blanket fort, so now it's, okay, you may have one of this blanket anyway, but now here's how it can be put to use right now. Keep your kids entertained, keep them happy. It's not just putting them in front of the screen, but it's this kick ass blanket for it. And so it's things like that, thinking about how do we reposition this to fit the time?

Roland:

Absolutely. Yeah. And if you think about it, like the messaging there is you've got a bunch of kids, you show a bunch of kids running around, what are we going to do? I'm bored. What are we going to do? I'm bored, you know? And then it's like, what am I going to do? I need, I have an essential, I need something to help these guys be entertained.

Brett:

It's now an essential.

Roland:

Oh, a big blanket, that sounds great.

Brett:

Big blanket comes on.

Roland:

So I love that. Absolutely. Really, really smart.

Brett:

Yup, very cool. So really good stuff. I know there's so much here we can talk about, I guess one thing I made just touch on because this is something that I'm interested in. What about for those people that they're in a good spot, maybe they've been responsible and they're sitting on some cash and they're thinking, I may be looking for my next opportunity or looking for something to buy. I know this is an area that you are a master enemy and I would even like for you to talk about your LEGS Intensives a little bit, but what advice would you give to somebody that is sitting on cash and maybe is looking for an opportunity? What should they be thinking now, what should they be looking for? And I know this can be like a huge topic, so we'll just do kind of a teaser. Yeah.

Roland:

Yeah. I think I would probably sit on it for another 30 days because I don't believe this is going to stop in 30 days. And I believe a lot of people are going to really, who are living hand to mouth in their businesses, that there's going to be some tremendous opportunities. I know already like restaurants, I've got buddies calling me saying, "These restaurants are selling their best wine at like what they paid for it 30 years ago, are you interested?" I'm like, "Yes, I'm interested. Absolutely." And the same thing is going to happen with events. I think like the opportunity to buy events, there's so many people who just got their lunch handed to them. On the event side, there's going to be opportunities there and in terms of products, people that maybe got their stuff frozen at Amazon and can't do anything right now, but they're freaking out. They need some cash, the ability to buy equipment, machines, inventory, blogs, media of all types.

Brett:

Yeah, media coats are way down, we're seeing that on YouTube. And I hear it's the same on Facebook. The cost for media is that a major low right now and everybody is at home, like in front of their computer. So everybody's watching YouTube or on Facebook or something like that.

Roland:

Yeah, that's the two things I say is like when somebody says, what do you think of gambling? I'm like, I think that if I came to you and you were a rational person and I said, "Let's play a game. It's going to be with your money and the odds are incredibly in my favor, but I'm going to entertain you while you're doing it. Would you like to do it?" Most people would say no, but then they go to Las Vegas and it's like, hey, and it's the same thing right now. Okay. So if there was no pandemic, then there was no recession and things were where they were two months ago and I came to you and I said, "Hey, I've got some advertising to sell you on Facebook and Google. It's half priced. And by the way, all of your competition, they're dialing back their advertising right now."

Brett:

Right, they're dialing back or they've left.

Roland:

You'd be like, I am so in, triple my ad spend, but now just because there's this situation, if people are thinking emotionally, not logically, they're like, no, I need to cut back too, I need to hunker down. Don't do that, that's crazy. This is the time absolutely to do that. So what's cool is that while it's ... I mean, I guess you can buy Google and Facebook at a discount now too in the stock market, but to actually acquire your own media right now, to acquire other people's blogs and videos and listings and all of those kinds of things. Podcasts, right? People are freaking out, if you've got the cash, and I don't think it's yet, I think it's about 30 days from now when it'll be, we'll have all been confined probably for that amount of time. Everybody's going nuts anyway.

Roland:

People are like, even if it's like ... It's kind of like there's traffic on the freeway and you know that if you get on the freeway, it'll take you 45 minutes to get where you're going. But if you take the back roads, it'll take you 45 minutes too, but you'll be moving the whole time.

Brett:

Yes.

Roland:

You feel like, I'm going to take the back road. So there are people that will feel like that with their assets and there'll be like, I can't do anything with my podcast. I can't do anything with my product right now, maybe I should just sell it because that's a motion, right?

Brett:

Yeah.

Roland:

That's motion. And so I think that you'll see highly motivated sellers and lots of opportunities to buy things. And of course, as you know, I'd typically buy those for no cash at all so not that you don't pay anything, it's just don't come out of pocket any cash. So I think it's possible to actually buy those assets, improve your media, buy additional products or services and at the same time not deplete the cash that you've got. So that if some other once in a lifetime deal comes along, and I say the once in a lifetime deal comes along three or four times a year. I think this year the once in a lifetime deal is probably going to come along five or six times. And you just want to conserve your cash, even if you've got it, when you're doing a buy like that so that you have the cash for the next dealing-

Brett:

For the next dealing.

Roland:

... In case it really does require.

Brett:

Yeah, I heard that and I'm trying to remember, oh, it was a Robert Ringer, the guy that wrote-

Roland:

Winning Through Intimidation.

Brett:

Yeah, exactly. Or he changed the title later to, to be, or not to be intimidated, but the original was ... Yeah.

Roland:

I like that first one.

Brett:

But he talked about, he quoted somebody else, I don't remember who it was, but he talked about the effective non use of cash. Right?

Roland:

Yes.

Brett:

Where you keep the cash, but you use it so you have enough net worth and whatever to be able to go and acquire deals. And so I think that would fall into this category. One of the marketing thing I want to talk about just real quickly as we wrap up. But before that, eventually we'll be able to do events in person together and all that stuff again, but talk about your LEGS Intensive just really quickly and if you've got plans for any more of those or maybe that's all yet to be determined, but you want to just speak to that real quickly?

Roland:

Yeah. And the answer is that for all of our events, we don't ... I follow my own advice. I'm not sitting on my hands or hunkering down. So we've pivoted, all of our events have moved virtual until this is over. So I have LEGS as leverage, exit, grow and scale. And we're doing our first virtual one, April 21st, 22nd and 23rd. And rather than get people ... Like I think it's really hard to sit in front of a computer for eight hours. And so I think the people who are doing events like that are going to find that it's really tough to maintain engagement, after about an hour and a half, we see drop-off on anything that we do no matter how-

Brett:

Totally makes sense. It's not nearly the same as being in a big room full of people.

Roland:

No. So we're going to do it a little differently. We're going to do it as over three days instead of two, and it'll be six, 90 minute sessions. And I'm actually doing that with Jay Abraham this time.

Brett:

Fantastic. Looking forward to it.

Roland:

And so we're going to do like 9:00 to 10:30, and then we're going to give an assignment for people to work on and then take a break and then come back at 2:00 and then go from 2:00 to 3:30, three days in a row instead of, we would normally do it over two days and it'd be like a day and a half. So it'll be the same amount of material, but way more interactivity. And you won't get bored if you need to take care of the kids or go build a fort with their big blanket or whatever to keep them from driving us crazy, you can do it. And because zoom offers the ability to do breakouts, we'll be able to actually break the group out into groups of four or five people with the assignment to work on the assignment and then hit the button and suck them back in to the main room. So it'll be really fun.

Brett:

Super cool.

Roland:

I mean, it's exactly like we do it except you're not literally able to touch the other person. Right? And we typically frown on that, we tell people not to touch each other, generally in this. But so yeah.

Brett:

The timing of that'd be perfect because, so as we're recording this on March 26 you're talking about, hey, waiting another 30 days or so to maybe look for your opportunity. This Intensive is going to be just before that and going to give you those tools, those resources and that mindset to say, okay, how can I acquire something maybe without cash down initially. And so yeah, sounds phenomenal.

Roland:

Yeah, it's going to be really fun. I'm excited about, we've had, it's really funny, the last class that we did was about two months ago and it's fun. I think there have been 17 businesses purchased probably by that class. And so it's really fun to watch people take the thing and then go, you can now ... Number one, it's a big change of mindset to say, I can buy a five million, eight million, $10 million business without having to come out of pocket, can't buy it for nothing. You're just buying it for nothing out of pocket. Right?

Roland:

And all of the, I have 159 different places to find the, or I call it the deal stack, right? 159 different levels or layers of the deal stack to be able to do it with no money out of pocket. And so we just kind of go through that and we go through hypotheticals and say, here's the company, your mission now is, I want you to buy it. I want you to buy it for no money out of pocket, I want you to put cash actually in your pocket and I want you to do it within the next 60 days. It's really, really a fun project. I think we're going to run a challenge on that too, that we're launching on Thursday.

Brett:

Ooh, sweet.

Roland:

So it's-

Brett:

Super cool.

Roland:

Yeah.

Brett:

So where can people, and I can link to this in the show notes as well, but where can people find more about that LEGS Intensive?

Roland:

That would be LEGS, L-E-G-S, legsintensive.com. So that's pretty easy to remember. And then, just generally, I am pretty much everywhere. Roland Frasier, anything /RolandFrasier, you'll find me. And I answer all my own messages and try to help as many people as I can.

Brett:

Yeah. Your kind of wicked fast, like shockingly fast at some of those things too. I don't know how you keep up with so many things going on at one time.

Roland:

Oh, and then of course I have Business Lunch where we're ... I've taken a lot of those lives, even the War Room ones that we were on and putting them on Business Lunch to try to help people and we're publishing more frequently right now just so while people are kind of in that ... My goal and I know why you're doing these too, our goal I believe is to give without any expectation.

Brett:

Yes.

Roland:

Particularly in this time and to be there, to show people that it's going to be okay, this has an end date and you don't want to hunker down. You want to engage, you want to pivot, you want to do all of the things now because the people that take action now are the people that are going to be the survivors and the thrivers when it's past that survival line.

Brett:

Absolutely

Roland:

So it's awesome that you're doing these things too.

Brett:

Yeah. I'm really, really, glad to be doing it, grateful to be doing it and appreciate guys like you that are inspiring everybody. So I think this will maybe be a good place to wrap up. We kind of leave with some positivity.

Roland:

Okay.

Brett:

And going back to that, that Harvard Business review article, talking about a couple of companies that took this advice in previous recessions and instead of hunkering down, they've leaned in and they accelerated. Let's maybe share those stories if you don't mind. I think one was Kellogg's and one was Toyota.

Roland:

Yeah. And that was in a Forbes article I found.

Brett:

Oh was it? Okay.

Roland:

Yeah. That was basically going back over the last hundred years through all the different recessions. And so in the great depression, the leading cereal company back then was Post and there was a kind of an upstart company called Kellogg's and Kellogg's leaned in, Post cut their spending by half. Kellogg's doubled their spending and Kellogg's launched a new product, also called rice Krispies with these little characters called snap, crackle and pop. And basically Post was never able to recover. And so Kellogg's just kind of took the lead. And then in the 70s, it was, back when they were rationing gasoline at gas stations and having the even odd days with license plates and all that, that was the first time that they published those EPA mileage estimate statements where this is what the, how many miles per gallon each of these cars get.

Roland:

And two of the winners were Volkswagen and Toyota, and Volkswagen cut back because of the recession. They were like, well, it's an oil crisis and there's not enough gasoline so we should make less cars and we should advertise less. And Toyota was like, screw that man. We're one of the most mileage efficient, we're leaning in. And Toyota was able to displace Volkswagen. And then in the 90s, it was McDonald's and Pizza Hut and Taco Bell. And when the recession hit, McDonald's cut their spending, their sales fell by 28%. Pizza Hut, Taco Bell said, this is awesome. Our biggest competitor has left the field, we're doubling down. Pizza Hut grew sales 60% and Taco Bell 40%.

Roland:

And then even in the great recession in the 2008, 2009, Amazon leaned in and was able to grow sales 28% and so like throughout history, and there's probably 50 examples of that, that are readily accessible and it's fun right now too, to watch even in terms of hiring, with Walmart hiring 150,000 people-

Brett:

Amazon's trying to do the same thing.

Roland:

And 100,000 people in Amazon and CVS is 50,000 and who is it? Domino's I think is 30,000, and 7-Eleven is 10,000. It's like that alone, just that information, getting that out to people to say, there's so much opportunity in prices and the opportunity isn't let's buy all the toilet paper and sell it for 500% more. The opportunity is let's look at that consumer matrix and say where is the demand and how do we pivot into it? How do we pivot into that demand?

Brett:

Yeah, I just absolutely love it and it's that simple mind shift to where this can be a time where you are excited and looking at, hey, this can be good. One, I can help people through this process. And two, I can grow my own business and my own future ventures and things like that. But I think just underscoring, hey, what all those companies that you just referenced, what they all saw during the recession was cheap media, lower competition, I'm going for it. We had a good message. And also I think people want to see ads. They want to buy stuff, it's comforting in tough times.

Roland:

We like to buy things, we've been trained all our lives to buy things, right? That's not, you can only bottle that up for so long before you're like, ooh.

Brett:

Pent up demand. Yeah. People have been saving a lot of money lately by being forced to be at home and they're ready to spend. So, Roland, man, this was fantastic. I know you're super busy, you're in high demand, you do Facebook lives, and all kinds of crazy stuff. But I really appreciate you taking the time and joining me.

Roland:

Thank you for having me. I'm happy to help in any way I can. And again, I really love what you're doing in helping people out in this time, it's so awesome to see so.

Brett:

Good.

Roland:

Thanks for doing that.

Brett:

Yup, absolutely. So I will link to everything, but Roland Frasier, everywhere online. Just Google him, facebook.com/, you'll find him as well. So thanks again to Roland and thank you for tuning in. As always, I would love to hear your feedback. What topics do you need right now? What information do you need? What would you like to see more of or less of? And if you feel so inclined with love, that five star review on iTunes helps more people find the show. And with that, until next time, thank you for listening. My man, it's a wrap, Roland.

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Episode 112

:

Liz Germain - vidfluence

Lessons from 100 Million Organic YouTube Views with Liz Germain of VidFluence

Liz Germain is a YouTube Marketing legend.

Liz Germain is a YouTube Marketing legend. We met when I was speaking at an event for eCommerce brands at the YouTube LA Offices. Between her own fitness channel and her client’s channels, she’s helped rack up over 100 million organic video views on YouTube. Wow! In this interview, we deep dive into how she does it. From the content, she creates to the research that inspires it. We also discuss where you should start and how to take your YouTube channel to the next level.

Here’s what we cover

Liz’s killer YouTube Influencer structure that leverages evergreen content for years of leads
How Liz created a video and blog post for a natural birth control method that is still generating leads and sales 4 years after it was created. Compare that to an Instagram story that has a shelf life of just 24 hours.
The 3 types of YouTube content and where you should start
The fundamentals of building a great YouTube Channel
Plus more

‍

Liz Germain - CEO & Founder at Vidfluence

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Super Sister Fitness YouTube Channel ‍

Vidfluence - YouTube Marketing Made Easy!