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Learn from Fast Growing 7-8 Figure Online Retailers and eCommerce Experts

EPISODE 367 54 mins

Lessons Learned Scaling 100+ D2C Brands – Jim Huffman, GrowthHit



About the guests

Jim Huffman

Kunle Campbell

Jim Huffman is the CEO of GrowthHit, a growth consultancy focused on conversion optimization, and the co-creator of FunnelTeardowns. Jim has grown two startups from idea to over $10M in sales. Spent over $4M on Facebook ads. Lead workshops at Fortune 500 brands like FedEx, Oreo, Hot Wheels & Intuit. Jim hosts a podcast, If I Was Starting Today.



On today’s episode, Kunle is joined by Jim Huffman, CEO of GrowthHit, a growth company that helps companies and founders scale their D2C business with data-driven goals.

Being a boy good with math and numbers, naturally, Jim would end up in a finance career, working in a bank. However, he realized he wanted to be on the other side of the table–the businessmen. With his experience in finance and investments, he rerouted his journey to becoming a consultant for business and launching startups.

From practicing consulting on the side to becoming his full-time career, Jim started GrowthHit and helped about 100-plus eCommerce businesses grow their brands. Practicing what he preaches, Jim also has other two successful businesses. One is a startup called Handsome Chaos and a productivized service called One Day Design for Shopify sites.

This episode is especially exciting as Kunle and Jim talk about every angle on scaling a brand, from the design and funding to having the proper mindset to authenticity and trust. Business owners as well as startup founders will be inspired by Jim’s journey, ideas and tips.

Here is a summary of some of the most important points made:

  • GrowthHit’s goal in sales for 2022 is $3 million and as much as possible, keeping a good, lean team.
  • GrowthHit’s best channels for paid acquisition is Meta and Google.
  • In terms of creatives, people are more drawn to transparency, more authenticity, and more raw type of content work.
  • Meta hasn’t updated interest-based targeting in over three years. The best way to find your audience isn’t with targeting, it’s with your creatives.
  • There are seven reasons that business owners should address why people don’t convert through their eCommerce funnel/website. These are price, quality, trust, confusion in how it works, shipping, urgency, or comparison shopping.

Covered Topics:

On today’s interview, Kunle and Jim discuss:

  • About GrowthHit
  • Jim’s Journey
  • From Finance to Marketing
  • Founder and Disruptor vs. Entrepreneur Mindset
  • GrowthHit’s Growth Trajectory
  • Focus for Brands’ Creatives
  • Brand Authenticity
  • GrowthHit’s Channel Mix
  • GrowthHit’s Paid Acquisition Channels
  • Thoughts on Meta’s Journey
  • How Brands Should Prime their Ads
  • Creating Impact and Perception
  • Web Design and Branding from a Design Perspective
  • Principles to Retention
  • Driving Growth with Key Personnel
  • Role of Finance in Creating a Culture-Defining Brand
  • Organic Scaling and Channel Marketing
  • Lightning Round

Timestamps:

  • 06:11 – About GrowthHit:
    • GrowthHit is a 30-person growth team for eCommerce companies.
    • They work on funnels, paid acquisition on ads, email marketing, and SMS.
  • 07:58 – Jim’s Journey:
    • Jim’s father passed away from ALS, Lou Gehrig’s disease when Jim was only seven.
    • Jim had a speech impediment which caused him to be held back at school.
    • Jim loves basketball and played all through high school and got a scholarship to a small D3 school.
    • Jim has always been good in math and numbers, as well.
  • 10:18 – From Finance to Marketing:
    • Jim took a Finance class at the University of Kansas.
    • In 2008, he was working in a company where, during the huge economic crisis, every analyst was laid off except for him.
    • He realized he wanted to become a business owner instead of becoming an investment banker doing mergers and acquisitions.
    • He went into a startup in New York and was about to launch in Dallas.
    • They grew the startup in Dallas from up to 100,000 customers.
  • 13:42 – Founder and Disruptor vs. Entrepreneur Mindset:
    • “When you’re catching someone at an early stage, when you’re a startup or starting something, you’re your default dead.”
    • “When a founder cobbled together some money or raised that seed or A Round, it’s a different pace and different type of persona that you’re working with.”
  • 15:25 – GrowthHit’s Growth Trajectory:
    • GrowthHit is made up of almost 30 people and is hoping to hit $3 million in sales this 2022.
    • GrowthHit is investing in their creative studio and their website’s conversion rate optimization.
    • GrowthHit has a startup studio, a productivity service called One Day Design, and their D2C brand, Handsome Chaos.
  • 18:04 – Focus for Brands’ Creatives:
    • GrowthHit is seeing more authenticity, transparency and rawness of content, rather than recreating the “Dollar Shave Club”.
    • “One tactical thing is something that does extremely well on TikTok, which is user-generated content, when it’s repurposed for Meta and Instagram, performs extremely well.”
    • Jim categorizes consumers into three personas: the early adopter, the skeptic, and the oblivious. Each of the personas requires different ways to talk to them and how you get in front of them.
  • 22:55 – Brand Authenticity:
    • “When they start to see you’re doing something like a tactic that isn’t true to you, they’ll be out even before they can convert or do that next purchase.”
    • “If you do make that decision on where you want to play, what you want to be, and then say no to everything else, those are the brands that break out. Those are the brands that do something special.”
  • 27:27 – GrowthHit’s Channel Mix:
    • There are 4 growth options for D2C brands namely, the paid channels, organic channels, virality or referrals, and the partner channels.
    • GrowthHit’s best channel for paid acquisition is Meta and Google. However, Jim said this could also change in 6 to 12 months.
  • 30:26 – GrowthHit’s Paid Acquisition Channels:
    • “With Google, we have to protect our brand name.”
    • “Google Shopping, especially if you can compete on price or do a category takeover, is huge.”
    • “YouTube is exciting whenever you’re doing bumper ads and you’re pairing with the videos that you want to be aligned with.”
  • 31:51 – Thoughts on Meta:
    • “When the iOS 14.5 update happened, it rocked everybody, our agency included.”
    • GrowthHit invested five figures for a Facebook Disruption team, an internal team at Facebook that decides the algorithm.
    • “Meta hasn’t updated interest-based targeting in over three years. The best way to find your audience isn’t with targeting, it’s with your creative.”
  • 35:50 – How Brands Should Prime their Ads:
    • Know where you are landing them based on their traffic source.
    • Make sure that you have obvious and non-obvious trust signals.
    • Address the seven reasons why people don’t convert in your eCommerce funnel/website. These are price, quality, trust, confusion in how it works, shipping, urgency, or comparison shopping.
  • 39:08 – Creating Impact and Perception:
    • “When you start talking about your features, your benefits, the problem you’re solving, and the tech specs around it, you’re already going to have all that trust.”
    • “Understanding the problem and articulating that, that’s one of the best things you can do for trust.”
  • 40:47 – Web Design and Branding from a Design Perspective:
    • “From site architecture, it’s simple. How many clicks are they having to take to get a purchase? How are we trying to activate them?”
    • “Sometimes less is more. Rather than saying fifteen things, one thing can be the main thing that gets them over the hurdle.”
    • The right mix of user-generated content and editorialized beautiful shots.
  • 43:29 – Principles to Retention:
    • Using email and SMS text messaging strategy to create a deeper relationship with the customer.
    • “What is the unique strategy that allows you to make email a conversion machine?”
  • 45:33 – Driving Growth with Key Personnel:
    • “It’s defaulting to a team that is not necessarily big but leaner and can move fast.”
    • “Customer service marketing has become the new social media manager”
    • Instead of hiring social media managers, brands are showing their behind-the-scenes on Tiktok.
  • 47:31 – Role of Finance in Creating a Culture-Defining Brand:
    • “Do you want to be the DTC brand that’s raising money and going for the moon?”
    • “If you raise $10 million, these investors want a 10X return so you have to hit $100 million.”
    • It’s a hard switch from growth to profitability.
  • 49:10 – Testing and Validation:
    • “For me, I want to push off the funding as much as I can. A lot of times, money isn’t the issue, it’s the product, people cannot scale, and then do that.”
  • 50:34 – Lightning Round:

Q: Are you a morning person
A: I am now that I have kids.

Q: What does your daily morning routine look like?
A: I wake up. I do a 30-minute workout down the street at 6:15 AM. I then have 30 minutes to do a morning journal. I try and write for twenty minutes.

Q: What are two things can’t you live without?
A: My Rad Power Bike that I got. I’m obsessed with it. I’m obsessed with my Vuori workout shorts.

Q: What book are you reading or listening to?
A: Made In America, the Sam Walton story.

Q: What’s been your best mistake to date, a setback that’s given you the biggest feedback?
A: We’ve made a hiring decision that did not work out that opened our eyes to how we should build our company that shouldn’t be doing what other people do but our own innovative way.

Takeaways:

  • The best way to deliver the message where we’ve seen it is by getting someone else to talk about how amazing your product is in a content format that doesn’t feel professional but feels authentic.
  • If you have the potential of a product that has high repeat purchases where your lifetime value extends beyond that first purchase, the more you get this dialed in, the more impactful everything’s going to be for your business.
  • It’s being honest with something that represents you because customers are smart. They will dig. They’ll go to your About Us page. They’ll poke around on social.

Links & Resources:

Facebook Group • Continue the Conversation

The eCommerce GrowthAccelerator Mastermind Facebook Group has just launched.
It is a community…

✔️ for founders and experts passionately involved in eCommerce
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✔️ for those willing and open to help and share with other members

Here is where to apply to join the Facebook group
>>http://bit.ly/ecommercefb<<

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Transcript

On this episode, I’m going to speak with an eCommerce growth marketer. I’m going to get his lessons learned from scaling 100-plus direct-to-consumer brands. It’s a great episode you do not want to miss.

Welcome to the 2X eCommerce Podcast show. This is the podcast dedicated to rapid and sustainable growth if you’re in the eCommerce space. This episode is an interview I had with Jim Huffman. He is the Co-founder of an agency called GrowthHit. He shares his lessons learned scaling 100-plus eCommerce startups.

This is a growth-driven episode you don’t want to miss. He speaks to the aspects of design, running advertising, and then retention. It’s a terrific episode. He is a well-versed and well-rounded founder or eCommerce growth expert. He talked about impressive product launches they’ve been able to achieve and how to maintain that momentum through retention marketing. He’s run marketing campaigns for brands such as Craft, Ministry of Supply, Uber Eats, and several other D2C eCommerce businesses. What more can I say? Enjoy this conversation I had with Jim.

Jim, it’s an absolute pleasure having you on the 2X eCommerce podcast.

Kunle, thank you for having me. I’m excited to be here. I’ve been listening for a while.

Thank you so much. Jim, you’re the Founder and CEO of GrowthHits. You’re more of a growth agency from what I gather and what we’ve briefly discussed. Do you want to give a quick intro about yourself and what you do at GrowthHit, please?

Yeah. We are a growth team for eCommerce companies where you’re like, “I want to grow. I want to go from selling hundreds of products and thousands of products.” We’ve got a 30-person team that can help and we essentially do three things. One is the bottom of the funnel. Do you have a website that can convert doing website design and CRO? We do paid acquisition on ads. We do email marketing and SMS. We’re trying to control the full funnel. We’ve been working on a growth program. We’ve done over 100 different companies. We’re nerds in the space. We love it.

A team of 30. You’ve worked with over 100 brands. How long have you been operating?

We’ve been around for a little over five years. The first few, to be honest, were me as a glorified consultant or freelancer. In the past few years, I was like, “Let’s go all in on this.” That’s when it’s been fun to build out a team and start to handle the best-in-class company.

I want to talk about what growth entails in 2022 given all the challenges and also opportunities from the past few years. I want to find out more about you, Jim. Do want to give me a bit of a background? What was your childhood like? What were your teen years like? How did that pipe into you as an adult? Let’s get back to Jim as a child, please.

I had a fairly normal upbringing. I grew up in the suburbs of Oklahoma City. One thing that was impactful for me growing up was my dad passed away when I was 7 from ALS, Lou Gehrig’s disease. That’s hard for anyone to go through, much less when you’re 7. A lot of issues came with that. I got held back in school. I had a speech impediment. A lot of things weren’t going in my favor.

One of the silver linings with that is when you get these tough things thrown in your direction and if you can overcome them at a young age, it starts to instill grit. It starts to instill maybe a work ethic or being okay with failure. I see some of those things now as I am a Monday morning quarterback and how those informed how I do things as a business owner. For me, it was being able to get my grades back up. I gravitated toward sports. I love basketball and played that all through high school and got a scholarship to a small D3 school. I didn’t take it. That was my childhood. That informed probably the person I became.

Jim, it sounds like you had a tumulus childhood. You seem to have a forecast on finance. Was it because you were analytical? How did you carve out that journey for yourself?

I always did better in math and with numbers than in English. That combined with being curious is what I liked about. It was a gateway into business and entrepreneurship. It’s what led me down the path of finance.

Where did you study? When did you get into the finance industry? Was it a clear pathway into the finance industry?

I was at the University of Kansas where I took a finance class. There was some impressive stuff there with people in New York that would come back to Kansas and teach. There was a hedge fund class and an investment-making class. I knew I wanted to get into that. My grade was a 3.4 GPA. I was also working in college. I would send letters out to all these investment banks and I got denied by everybody.

There was one that would take a risk on me and I got that job in Dallas. What’s interesting is I was working there and in 2008, there was this huge economic crash and they laid off every analyst but me. I wasn’t the smartest. I could count on my hand how many people are smarter than me. I worked probably harder than anybody else. I had more grit as far as I would be working Saturdays and Sundays. Maybe that’s why they held on to me.

2008 was a tough time. There are echoes of what we’re facing now with 2008. With the retention there, how long did you last? How did you get into a marketing agency from finance?

With this small investment bank, we’re doing mergers and acquisitions. I’d be in these rooms where someone’s about to sell their company for $30 million or $100 million. It was eye-opening. I’m in this room and I didn’t want to be the investment banker or the lawyer in the room, I wanted to be on the other side of the table. I wanted to be that business owner.

For me, I was like, “I’m in the wrong profession.” That’s when I made the big leap going from finance to going into startups. I found one that was out in New York that was about to launch in Dallas and I raised my hand, “I’d love to take a crack at that.” I had no idea what I was doing. I jumped into it and got lucky mainly because they had an amazing product. While I was the main guy there, we grew it in Dallas from nothing to 100,000 customers. From that, I got to go to New York at the headquarters and work with the founding team to build it out.

From there, I went to another startup and was able to grow that one to a million users. That opened the door to start teaching marketing and working with some venture capital firms. I started consulting on the side. All of a sudden, I’m doing more consulting than I am for my full-time job. All of a sudden, I have an agency. That was the roundabout path of me starting GrowthHit.

Fascinating journey. You’re now settled from a career standpoint. This is what you guys are doing full-time. You’ve worked with about 100-plus eCommerce brands. These are not mom-and-pop or in a less lesson-ambitious spectrum. You guys have partnered with some pretty impressive startup incubators and not just eCommerce incubators, General Assembly, WeWork Labs, and Techstars. Do you want to speak about the difference from a mindset standpoint from a company or founder that wants to disrupt a vertical or industry to an entrepreneur or an eCommerce team that wants to get a slice of the market?

Try to figure out what makes sense for you because you can have anything but you can't have everything. Click to Tweet

When you’re catching someone at an early stage, when you’re a startup or starting something, you’re your default dead. You’re a default out of business. It’s not some big company that already has revenue coming in. From the start, you have to be ready to put in the time. That combined with not making money but you’re trying to grow 10% month over month. You have these huge goals and aspirations.

It’s a different type of team you’re working with and a different type of playbook to pull that off. Usually, time is your enemy. You’re having to move quickly. We’ve also worked with big companies. Craft has a disruption lab and we’ve worked with them. When a founder cobbled together some money or raised that seed or A Round, it’s a different pace and different type of persona that you’re working with.

10% growth month over month requires a multidisciplinary team and multiple channels I would guess. Before we even jump into that, let’s talk about who you guys are now. Where are you now? What’s been the growth trajectory at your agency? Who are your key players?

We’re approaching 30 people. We’re hoping to hit $3 million in sales this 2022. Some of the biggest levers for us is investing in our creative studio. Especially with consumer brands, whether it’s your ads or your landing page, the bar keeps getting raised on creative. That was a big move for us. The second is if you don’t have a website that can’t convert, you can’t grow. Conversion rate optimization has enabled us to get our foot in the door and prove ourselves.

The other thing with our agency is we’re not just trying to be some 100-person agency. We believe that if we’re such a good growth team, why can’t we grow our own products? We have a startup studio that we’re trying to put our foot on the gas with. One is a productized service called One Day Design where we design a landing page in 24 hours for Shopify sites. The one we’re excited about is our DTC brand, Handsome Chaos. Ask me in two years if this is a good move or not because we know a lot about the marketing side of things so we’re trying to put it to work with our own product.

You’re incubating consumer brands.

Yeah. The way we started it was we would pull people based on a problem. We spoke to 1,000 guys. We’re like, “Do you have long hair and you don’t have a product that works for you because it looks oily? Would you be willing to switch products to try ours?” We got 70% of people to respond, “I’d be interested.”

We set up a landing page. We’re able to get 1,000 people on the waitlist. We’re like, “Let’s try and sell a product that doesn’t exist.” We were able to get 25 people to buy it. We had to refund them because the product didn’t exist. Now, we’re manufacturing the product. That has taken so long. We’re much better at marketing than chemistry formulations. After the fourteenth iteration, we have a product that we’re ready to take to market.

Nothing good comes easy, especially physical. Best of luck with that. You guys are unique in the sense that many agencies would specialize in 1 or 2  disciplines to support an eCommerce business. You mentioned the fact that you have very strong creatives. I want to dig deeper into creatives. You’re not just into design but you’re into direct response design in terms of CRO design, in terms of ensuring people take the actions you want them to take. The other piece you mentioned was retention. You also take on that lifecycle marketing role.

What I want to do for the rest of this interview is get into the first principle of thinking in each of these disciplines. We’ll start with creatives. How have creatives changed? Why has the bar been raised? There’s IGC, which is Influencer Generated Content. There’s UGC, which is User Generated Content or Shopper Generated Content. There are content brands produced. In this age of TikTok, Instagram, and Facebook, what should be the focus of creatives by brands towards generating interest that results to clicks and hopefully sales?

We’ve done many experiments on this and things that have not worked. In a previous world, you used to have to spend $20,000 to $50,000 on your launch video. You’re trying to recreate the Dollar Shave Club experience. That could work but we’ve seen that flop many times. As people have become almost numb to that, we’re seeing more transparency, more authenticity, and more raw type of content work.

To give more details on that, one tactical thing is something that does extremely well on TikTok, which is user-generated content, when it’s repurposed for Meta and Instagram, performs extremely well. Let’s talk about how that has to be laid out. The way we think about it is, who are we going after? You have different types of persona like the early adopter who is very much trying to solve a problem that’s proactive. That’s one persona.

You have a second, which is a skeptic. They’ll see something and they’re already on their heels. It’s like “I don’t believe this.” The third persona, you have this almost oblivious person. With those three different people, you have to talk to them in different ways and how you get in front of them. One is problem solution oriented. The second is more around trust and quality.

By the way, that oblivious person, that’s who you should default to marketing. That’s where you have to educate them on what this is, why they should care, and why now. The best way to deliver that message where we’ve seen is by getting someone else to talk about how amazing your product is in a content format that doesn’t feel professional but feels authentic. Doing that narrative of storytelling, whether it’s introducing the category because there’s one aside.

I’m a big fan of the book, The 22 Immutable Laws of marketing. Chapter two is category creation. When you’re going after this oblivious person, if you can anchor it around a category you’re creating, a problem you’re solving within that category, and why they should care. If you can slice that up into 25 or 45 seconds where the product is the hero, that’s when it’s magical. That was high level but that’s how we’re thinking about it. Whether it’s influencers or your customers or you’re trying to do that yourself, that’s been the stuff that works extremely well for top-of-funnel acquisition type of content.

The oblivious persona seems to be the most challenging of the three personas you alluded to. You hit the nail on the head. You’re able to cater to all three. I like your points on category creation, problem-solving within the category, and why they should care about your product being the hero. It boils down to this authenticity. How should brands approach authenticity beyond having an influencer give a good testimonial review about you in an ad? What other cues or thrills are savvy consumers looking for to determine the authenticity of first-time brands that they come across?

I’m guilty of this as well. You want to copy and paste what other great brands are doing. It’s like, “They’re mission-driven, we’re mission-driven. They’re doing a community, we’re going to do a community.” That might work. You might get lucky. You have to boil down to, “Why are we starting this? Do we have a true and authentic story, the founding story? Do we have a real problem or even a silly problem that we’re trying to solve and we want to rally around? What is our voice? What is our tone?”

It’s being honest with something that represents you because customers are smart. They will dig. They’ll go to your About Us page. They’ll poke around on social. When they start to see you’re doing something like a tactic that isn’t true to you, they’ll be out even before they can convert or do that next purchase. Try to figure out what makes sense for you because you can have anything but you can’t have everything. You have to make that decision on the lane you want to pick.

It’s hard in the early days to be like, “I’m not going to niche down. I’m going to go to everything.” If you do niche down, if you do make that decision on where you want to play, what you want to be, and then say no to everything else, those are the brands that break out. Those are the brands that do something special.

It’s profound. In regards to platforms for gaining attention, where are Facebook, Instagram, and TikTok? What’s your channel mix at the moment at GrowthHit?

Let’s talk about, at a high level, what are your options if you want to grow and if you’re a DTC brand. You have four options. You have paid channels that you can participate in. The second option is organic channels you could play whether that’s SEO, content, marketing, and organic social. The third that you have is you can try and grow through virality or referrals. The fourth and final one is you can grow through partner channels. You’re selling on Amazon. You’re selling on Wholesale.

Brands need to be intentional with the stage that they’re at. What can they focus on and do extremely well? For us, we have to be able to show ROI on the channels we’re growing on. We don’t do a lot of things that I recommend brands should do. We don’t do SEO. They should definitely do that. We don’t do PR. They should definitely do that. We don’t do organic TikTok, which brands should be doing from a brand awareness play.

For us, the best channel to grow for paid acquisition, and this could change in 6 to 12 months, Meta is still number one for us and Google second. That can vary depending on the product category. Those are the ones that are repeatable and scalable in an ROI-positive way. We have our finger on the pulse of what’s going on with TikTok and watching the performance. We’re not seeing the scalability yet on the paid acquisition side but that can flip.

Brands need to be intentional with the stage that they're at. What can they focus on and do extremely well? Click to Tweet

The other call out is a lot of companies want to be diversifying to do so many channels at once. We see that being a mistake. Instead of trying to do everything, choose one, master it, do it well, scale it, and then move to the next thing. Until you’re spending over $15,000 or $20,000 a month on ads, figure out which one works well. We can look at a lot of top growing brands and they got to 6 or 7 figures usually on the back of 1 to 2 channels. That’s a common issue that we see.

You’re right in the sense that if you master one channel, you achieve scale on that channel. You could have that conversation of moving to the next channel rather than having to go to many channels. I’m also interested in Meta and Google, the top of your list. In the Google space, are you speaking to YouTube ads or Google Search Ads?

Both. With Google, we have to protect our brand name. You’re bidding on your brand name like Handsome Chaos or whatever that would be. It’s a question of, do we want to play in the competitive landscape where you’re going after the competitor’s name? That can be a slippery slope when you play that game and it’s dependent on the industry. The third is you’re looking at what keyword mapping should you do to drive the non-branded keywords you go after. Is it hair products for guys with long hair or dry shampoo for men and things like that? Google Shopping, especially if you can compete on price or do a category takeover, is huge.

YouTube is exciting whenever you’re doing bumper ads and you’re pairing with the videos that you want to be aligned with. Video production for YouTube and getting that right is something, being transparent, not something that we do. We’re usually getting that video content. When you can get their attention in five seconds and get them to hang on, it’s pretty magical. That’s something we’re looking to add to the roadmap.

Meta, the big elephant in the room, has been through its peaks and drops, to say the least. Where do you think it is in its journey now? Is it stabilizing? I’d love to hear your thoughts.

When the iOS 14.5 update happened, it rocked everybody, our agency included. What we did is we invested Five Figures. There’s the Facebook disruption team, the internal team at Facebook that would decide the algorithm. We started working with someone that was a part of that team. We’ve changed how we optimize our ads four times in 2021.

In four months, we’ve had some of the best success. Here’s the reason why. With the Meta algorithm, you have 3 to 4 levers you can pull. Your targeting is one lever. The second is around your account architecture. The third is your copy, your offer, and your positioning. The fourth is your creative. Historically, interest-based targeting was fantastic and then it was lookalikes.

Here’s the truth. Meta hasn’t updated interest-based targeting in over three years. The best way to find your audience isn’t with targeting, it’s with your creative. It will find the people that will engage with it with the events that you see fit. The other issue is if you still have an account architecture that’s using the 2019 or even the 2020 playbook, you’re probably hurting yourself. You need to default more to broad. Let the creative run and make sure you’re getting your ads out of learning.

What does that mean for the non-nerds on this podcast? How many events can you get in a week whether that’s a purchase event to feedback to the algorithm? It’s like, “50 people made this purchase. Let’s find more people like them.” The more you get out of the algorithm’s way to get over 50 events so they can then find people that represent those 50 that did the event, you get out of learning, you get into optimization mode, and you can get your cost per acquisition down. There are some simple account structures you can do to enable this. When we started defaulting to this methodology, it’s been transformative for our accounts, even in the post-iOS world.

What is this disruptive team? What’s Five Figures? Did you have to pay to have access to them?

Yeah. It’s the internal team at Facebook and people spun out and they’re giving courses and updates on how to run your ad accounts based on how the algorithm changes. It’s a cohort-based class that happens on a quarterly basis. It’s $10,000 to be a part of it. It’s something we don’t make our clients pay. We pay because we have to. I would rather pay that amount and have happy clients than not pay that amount and be hitting our head against the laptop every day trying to wonder why RoW ads isn’t where it should be.

It’s with X employees of Facebook.

Exactly.

You get that click. All of our activities on Facebook are optimized for attention and the click to get through to the website. What are the first few seconds or what’s the moment when traffic or people get to your site fill and look like? How should brands prime them for their intended objective?

First, it’s knowing where you’re landing them based on the traffic source. Assuming it’s from ads, know that we’re probably on mobile, more than likely. What is this ad? How do we prime them? Is it more of this fun awareness play like educating them on the category or is it higher intent? Are they ready to make a buying decision? Do we still need to educate or can we prime them to convert and take action? That’s something that we’re thinking through.

Another thing, especially when you’re starting, you’ve got to make sure you have obvious and non-obvious trust signals. Non-obvious ones are like, “Is the site loading in a clean way? Does it have high-quality images and things that demonstrate that this is probably legit?” Another thing is, so many times, I see cool brands with cool websites that have bad conversion rates because they weren’t thinking through the fact that it needs to look great but we need a site that converts.

The truth with any eCommerce funnel or website is there are 3 to 7 reasons why people don’t convert. If you start with that idea in your mind, how are you addressing those? Those could be because people aren’t converting because of price, quality, trust, confusion in how it works, shipping, urgency, or comparison shopping. Usually, out of those options, there are 2 or 3 that are the most prominent. If you’re launching fitness equipment that’s $300 to $400, we probably know we’re up against comparison shopping and we’re up against price and quality.

If those are our biggest barriers, how are we addressing that? We’re addressing that with, “This is used by the quarterback for the 49ers. The Olympic teams’ training coach came up with this.” You can have it in the form of reviews. Another thing is if it’s price, how can you make the price more obtainable where it’s anchoring against something more expensive? Yes, this is a $1,000 but it’s $75 a month or whatever that could be.

Know why people aren’t converting. The average conversion rate on a Shopify website is probably 2%. 98% of your traffic isn’t converting and you do definitively know why. A lot of people don’t because it’s hard to see why your baby’s ugly. The more you lean into that pain and understand it, you can then design a website around those points of friction in the decision journey. When you can address them the right way, that is the biggest unlock you can have for growth that can take you to that next level.

For new brands trying to make an impressionable impact on their perception in building out trust, what do you think they should have? What infrastructure should they have in place to cater, to get not just attention but for trust from prospects when they land on their sites?

It’s easy to want to talk about your amazing features or the details behind them. There are great places for that. If you want to earn trust, this is a counterintuitive strategy, the more you can talk to the problem you are solving in the language that the customer understands. When you nail it, you are perceived as the expert or the leader because you understand the problem so well. The more you can do that, the more you can earn trust by having the right solution to what they need.

When you start talking about your features, your benefits, the problem you’re solving, and the tech specs around it, you’re already going to have all that trust. You can throw in reviews and social proof and before and afters. Understanding the problem and articulating that, that’s one of the best things you can do for trust.

Getting that problem shorter. From a design perspective, what should readers be aware of from web design and branding? We’ve talked about the more CRO aspects but from a design perspective, how do you build that out?

Instead of trying to do everything, choose one, master it, do it well, scale it, and then move to the next thing. Click to Tweet

First, from site architecture, it’s simple. How many clicks are they having to take to get a purchase? How are we trying to activate them? Whether that’s through a quiz funnel or through subscribing, amazing navigation. With that in mind, how does design play into that? If it’s doing a quiz funnel, how do you make it fun and visual rather than tech space?

If we have a flat page where they’re going to one page where they can convert, we want to show that it’s premium but how can you also make it approachable and give people what they want? They want pictures in the wild. They want real people using it. Seeing other use cases of it. Sometimes we have some premium brands that want editorialized beautiful shots.

We also see that seeing real people in these products, user-generated content performs well. Having that right mix can be impactful whenever you’re doing it. Also, we want to say quite a bit. You’ve got to give these pages whitespace. You got to give the stuff room to breathe. Sometimes less is more. Rather than saying fifteen things, one thing can be the main thing that gets them over the hurdle. Telling things with visuals rather than tech is good for that.

That’s important. I remember I was involved in a fashion site. We tested this and we switched. This was in 2018. We switched the studio photos on their category pages with social media. They were either customers or influencers. Most of them are influencers wearing the items rather than modules on category pages. The click-through rates more than tripled off the back of being more relatable products. There was consistency in the way the photos were presented. It was mind-blowing.

I believe it. That’s awesome.

Speaking to retention where all the magic happens, you work largely to get in brands to market and allow them to get their first 1000 customers or first 10,000 customers or what have you. What are the first principles should we be cognizant of when it comes to retention?

If you have the potential of a product that has high repeat purchases where your lifetime value extends beyond that first purchase, the more you get this dialed in, the more impactful everything’s going to be for your business. What that means is, what is the unique strategy that allows you to make email a conversion machine? Whether that’s your onboarding flows, your Winback flows, and your abandonment flows. Do it along the lines of, what’s the average close time? What’s the average repeat purchase time? What is the decision journey they have to go down? You have to retrain them or reposition them to buy this thing not once a year but once a month.

Another thing where we’re seeing things go to the next level is email is important but if you can bolt on an SMS text messaging strategy that is a deeper relationship with the consumer, you have gold on your hands. For example, Curology. Their skincare product is personalized for you. With SMS, they connect you with a dermatologist so they can track how your skin’s doing and getting better. That leads to having a strong subscription product with high retention because you’re getting access to a doctor.

It’s highly personalized with SMS. All in all, from your interactions with brands that are rocking and performing in 2022, what does their team look like? I’m speaking about either startup teams launching eCommerce brands or brands looking to deliver further growth. What’s the consistency of their teams? Their teams are working with you guys. How are they driving growth with key personnel?

It’s defaulting to a team that not necessarily is big but leaner and can move fast. At the end of the day, with your overall growth strategy, when you look at your twelve months, you’re going to have natural demand in Q4 and maybe Q2 and then droughts in Q1 and Q3. How can you maximize demand throughout those years? You have the right team to support that. We’re seeing a heavy emphasis on community as marketing, people bolting on the community to it.

Another thing is someone that is almost customer services marketing, especially with a high retention product, that is something that has become the new social media manager. It’s the customer service manager that also does social where they’re transparent with what they do. As people get passed in A Round, we’re seeing some impressive things with the data team and data scientist.

More and more brands are trying to crack the code on TikTok. Instead of finding a social media manager to do that, they’re finding people internally at their company that is social media-minded. They can show more behind-the-scenes of what they’re doing with the brand. Those are some things that we’re seeing.

The final point is the role of finance in creating a culture-defining or more or less challenger brand. What is the role of raising money? I like to hear your thoughts since you work with many companies in that situation.

This is a big discussion around, do you want to be the DTC brand that’s raising money and going for the moon? It’s amazing to have those resources. It’s amazing to get the headlines. If you raise $10 million, these investors want a 10X return so you got to hit $100 million. If you’re at $50 million, you keep moving the goalposts back. It can be hard to land that plane. Even if you look at Allbirds, Casper, and Warby Parker, it’s been hard to switch from growth to profitability.

If you’re going to go down that path, know what is the maximum that you want to raise because the goals are very high with that. On the flip side, look at BornPrimitive. Look at what Vuori has done. Vuori already did eventually raise. When you’re not raising as much money, you don’t have to move those goalposts as far back, as far as the outcome you want. We’re seeing smaller big rounds, to be honest, with a lot of the DTC brands who are trying to cobble together funds to do it themselves. It’s been an interesting shift in 2021.

You mentioned something that resonates with me earlier, which is the three ways to grow, which are organic paid, and channel marketing. Hero Cosmetics, I don’t know whether you’ve heard about them, they’re a $100 million brand. They’re everywhere. They’re in Target stores, Walmart, or Amazon. They’re the D2C. They don’t see themselves as a D2C brand. They found validation D2C but they were a faster market. They’re funded but they’re growing fast. Do you think this is the factor moving forward where you test D2C and then you scale?

For me, I want to push off the funding as much as I can. A lot of times, money isn’t the issue, it’s the product, people cannot scale, and then do that. I’m quite fascinated by that option. It’s easier than ever to stand up companies and products and get more traction. I’m pretty bullish on that.

Jim, we’ve exhausted the questions I have for you. Before I let you go, I’d like you to jump in on our rapid-fire questions session. I’m going to ask you six questions and if you could use a single answer to answer this question, it’d be great. Are you a morning person?

I am now that I have kids.

What does your daily morning routine look like?

I wake up. I do a 30-minute workout down the street at 6:15 AM. I then have 30 minutes to do a morning journal. I try and write for twenty minutes.

What are two things can’t you live without?

My Rad Power Bike that I got. I’m obsessed with it. I’m obsessed with my Vuori workout shorts.

What book are you reading or listening to?

Made In America, the Sam Walton story.

Finally, what’s been your best mistake to date, a setback that’s given you the biggest feedback?

We’ve made a hiring decision that did not work out that opened our eyes to how we should build our company that shouldn’t be doing what other people do but our own innovative way.

Jim, it’s been an absolute pleasure having you speak about your story and GrowthHit, your agency. For those who want to find out more about GrowthHit, I would drive them to GrowthHit.com. Are you guys active on any social media platforms? If yes, which ones?

We’re active as individual team members. I’m on Twitter, @JimWHuffman. That’s where we’re the most active.

Thank you for coming on the 2X eCommerce Podcast, Jim.

Kunle, thank you so much for having me.

Cheers.

About the host:

Kunle Campbell

An ecommerce advisor to ambitious, agile online retailers and funded ecommerce startups seeking exponentially sales growth through scalable customer acquisition, retention, conversion optimisation, product/market fit optimisation and customer referrals.

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