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Ryan Flessner, What If I Don't Understand Their Thinking? ROUNDING UP: SEASON 3 | EPISODE 15 “What do I do if I don't understand my student's strategy?” This is a question teachers grapple with constantly, particularly when conferring with students during class. How educators respond in moments like these can have a profound impact on students' learning and their mathematical identities. In this episode, we talk with Ryan Flessner from Butler University about what educators can say or do when faced with this situation. BIOGRAPHY Ryan Flessner is a professor of teacher education in the College of Education at Butler University in Indianapolis, Indiana. He holds a PhD in curriculum and instruction with an emphasis in teacher education from the University of Wisconsin–Madison; a master of arts in curriculum and teaching from Teachers College, Columbia University; and a bachelor of science in elementary education from Butler University. Prior to his time at the university level, he taught grades 3–7 in Indianapolis; New York City; and Madison, Wisconsin. RESOURCES Nearpod Pear Deck GeoGebra  Magma Math TRANSCRIPT Mike Wallus: “What do I do if I don't understand my student's strategy?” This is a question teachers grapple with constantly, particularly when conferring with students during class. How we respond in moments like these can have a profound impact on our students' learning and their mathematical identities. Today we'll talk with Ryan Flessner from Butler University about what educators can say or do when faced with this very common situation.  Welcome to the podcast, Ryan. Really excited to talk to you today. Ryan Flessner: Thanks, Mike. I'm flattered to be here. Thank you so much for the invitation. Mike: So, this experience of working with a student and not being able to make sense of their solution feels like something that almost every teacher has had. And I'll speak for myself and say that when it happens to me, I feel a lot of anxiety. And I just want to start by asking, what would you say to educators who are feeling apprehensive or unsure about what to do when they encounter a situation like this? Ryan: Yeah, so I think that everybody has that experience. I think the problem that we have is that teachers often feel the need to have all of the answers and to know everything and to be the expert in the room. But as an educator, I learned really quickly that I didn't have all the answers. And to pretend like I did put a lot of pressure on me and made me feel a lot of stress and would leave me answering children by saying, “Let me get back to you on that.” And then I would scurry and try and find all the answers so I could come back with a knowledgeable idea. And it was just so much more work than to just simply say, “I don't know. Let's investigate that together.” Or to ask kids, “That's something interesting that I'm seeing you do. I've never seen a student do that before. Can you talk to me a little bit about that?” And just having that ability to free myself from having to have all the answers and using that Reggio-inspired practice—for those who know early childhood education—to follow the child, to listen to what he or she or they say to us and try to see. I can usually keep up with a 7- or an 8-year-old as they're explaining math to me. I just may never have seen them notate something the way they did. So, trying to ask that question about, “Show me what you know. Teach me something new.” The idea that a teacher could be a learner at the same time I think is novel to kids, and I think they respond really well to that idea. Mike: So, before we dig in a little bit more deeply about how teachers respond to student strategies if they don't understand, I just want to linger and think about the assumptions that many educators, myself included, might bring to this situation. Assumptions about their role, assumptions about what it would mean for a student if they don't know the answer right away. How do you think about some of the assumptions that are causing some of that anxiety for us? Ryan: Yeah. When the new generation of standards came out, especially in the field of math, teachers were all of a sudden asked to teach in a way that they themselves didn't learn. And so, if you have that idea that you have to have all the answers and you have to know everything, that puts you in a really vulnerable spot because how are we supposed to just magically teach things we've never learned ourselves? And so, trying to figure out ways that we can back up and try and make sense of the work that we're doing with kids, for me that was really helpful in understanding what I wanted from my students. I wanted them to make sense of the learning. So, if I hadn't made sense of it yet, how in the world could I teach them to make sense of it? And so we have to have that humility to say, “I don't know how to do this. I need to continue my learning trajectory and to keep going and trying to do a little bit better than the day that I did before.” I think that teachers are uniquely self-critical and they're always trying to do better, but I don't know if we necessarily are taught how to learn once we become teachers. Like, “We've already learned everything we have to do. Now we just have to learn how to teach it to other people.” But I don't think we have learned everything that we have to learn. There's a lot of stuff in the math world that I don't think we actually learned. We just memorized steps and kind of regurgitated them to get our A+ on a test or whatever we did.  So, I think having the ability to stop and say, “I don't know how to do this, and so I'm going to keep working at it, and when I start to learn it, I'm going to be able to ask myself questions that I should be asking my students.” And just being really thoughtful about, “Why is the child saying the thing that she is?,” “Why is she doing it the way that she's doing it?,” “Why is she writing it the way that she's writing it?” And if I can't figure it out, the expert on that piece of paper is the child [herself], so why wouldn't I go and say, “Talk to me about this.”? I don't have to have all the answers right off the cuff. Mike: In some ways, what you were describing just there is a real nice segue because I've heard you say that our minds and our students' minds often work faster than we can write, or even in some cases faster than we can speak. I'm wondering if you can unpack that. Why do you think this matters, particularly in the situation that we're talking about? Ryan: Yeah, I think a lot of us, especially in math, have been conditioned to get an answer. And nobody's really asked us “Why?” in the past. And so, we've done all of the thinking, we give the answer, and then we think the job is done. But with a lot of the new standards, we have to explain why we think that way. And so, all those ideas that just flurried through our head, we have to now articulate those either in writing on paper or in speech, trying to figure out how we can communicate the mathematics behind the answer.  And so, a lot of times I'll be in a classroom, and I'll ask a student for an answer, and I'll say, “How'd you get that?” And the first inclination that a lot of kids have is, “Oh, I must be wrong if a teacher is asking me why.” So, they think they're wrong. And so I say, “No, no, no. It's not that you're wrong. I'm just curious. You came to that answer, you stopped and you looked up at the ceiling for a while and then you came to me and you said the answer is 68. How did you do that?” A child will say something like, “Well, I just thought about it in my head.” And I say, “Well, what did you think about in your head?” “Well, my brain just told me the answer was 68.”  And we have to actually talk to kids. And we have to teach them how to talk to us—that we're not quizzing them or saying that they're wrong or they didn't do something well enough—that we just want them to communicate with us how they're going about finding these things, what the strategies are. Because if they can communicate with us in writing, if they can communicate on paper, if they can use gestures to explain what they're thinking about, all of those tell us strengths that they bring to the table. And if I can figure out the strengths that you have, then I can leverage those strengths as I address needs that arise in my classroom. And so, I really want to create this bank of information about individual students that will help me be the best teacher that I can be for them. And if I can't ask those questions and they can't answer those questions for me, how am I going to individualize my instruction in meaningful ways for kids? Mike: We've been talking a little bit about the teacher experience in this moment, and we've been talking about some of the things that a person might say.  One of the things that I'm thinking about before we dig in a little bit deeper is, just, what is my role? How do you think about the role of a teacher in the moment when they encounter thinking from a student that they don't quite understand […] yet? Part of what I'm after is, how can a teacher think about what they're trying to accomplish in that moment for themselves as a learner and also for the learner in front of them? How would you answer that question? Ryan: When I think about an interaction with a kid in a moment like that, I try to figure out, as the teacher, my goal is to try and figure out what this child knows so that I can continue their journey in a forward trajectory. Instead of thinking about, “They need to go to page 34 because we're on page 33,” just thinking about, “What does this kid need next from me as the teacher?”  What I want them to get out of the situation is I want them to understand that they are powerful individuals, that they have something to offer the conversation and not just to prove it to the adult in the room. But if I can hear them talk about these ideas, sometimes the kids in the classroom can answer each other's questions. And so, if I can ask these things aloud and other kids are listening in, maybe because we're in close proximity or because we're in a small-group setting, if I can get the kids to verbalize those ideas sometimes one kid talking strikes an idea in another kid. Or another kid will say, “I didn't know how to answer Ryan when he asked me that question before, but now that I hear what it sounds like to answer that type of a question, now I get it, and I know how I would say it if it were my turn.”  So, we have to actually offer kids the opportunity to learn how to engage in those moments and how to share their expertise so others can benefit from their expertise and use that in a way that's helpful in the mathematical process. Mike: One of the most practical—and, I have to say, freeing—things that I've heard you recommend when a teacher encounters student work and they're still trying to make sense of it, is to just go ahead and name it. What are some of the things you imagine that a teacher might say that just straight out name the fact that they're still trying to understand a student's thinking? Tell me a little bit about that. Ryan: Well, I think the first thing is that we just have to normalize the question “Why?” or “Tell me how you know that.” If we normalize those things—a lot of times kids get asked that question when they're wrong, and so it's an [immediate] tip of the hat that “You're wrong, now go back and fix it. There's something wrong with you. You haven't tried hard enough.” Kids get these messages even if we don't intend for them to get them. So, if we can normalize the question “Tell me why you think that” or “Explain that to me”—if we can just get them to see that every time you give me an answer whether it's right or wrong, I'm just going to ask you to talk to me about it, that takes care of half of the problem.  But I think sometimes teachers get stuck because—and myself being one of them—we get stuck because we'll look at what a student is doing and they do something that we don't anticipate. Or we say, “I've shown you three different ways to get at this problem, different strategies you can use, and you're not using any of them.” And so, instead of getting frustrated that they're not listening to us, how do we use that moment to inquire into the things that we said obviously aren't useful, so what is useful to this kid? How is he attacking this on his paper?  So, I often like to say to a kid, “Huh, I noticed that you're doing something that isn't up on our anchor chart. Tell me about this. I haven't seen this before. How can you help me understand what you're doing?” And sometimes it's the exact same thinking as other strategies that kids are using. So, I can pair kids together and say, “Huh, you're both talking about it in the same way, but you're writing it differently on paper.” And so, I think about how I can get kids just to talk to me and tell me what's happening so that I can help give them a notation that might be more acceptable to other mathematicians or to just honor the fact that they have something novel and interesting to share with other kids. Other questions I talk about are, I will say, “I don't understand what's happening here, and that's not your fault, that's my fault. I just need you to keep explaining it to me until you say something that strikes a chord.” Or sometimes I'll bring another kid in, and I'll have the kids listen together, and I'll say, “I think this is interesting, but I don't understand what's going on. Can you say it to her? And then maybe she'll say it in a way that will make more sense to me.” Or I'll say, “Can you show me on your paper—you just said that—can you show me on your paper where that idea is?” Because a lot of times kids will think things in their head, but they don't translate it all onto the paper. And so, on the paper, it's missing a step that isn't obvious to the viewer of the paper. And so, we'll say, “Oh, I see how you do that. Maybe you could label your table so that we know exactly what you're talking about when you do this. Or maybe you could show us how you got to 56 by writing 8 times 7 in the margin or something.”  Just getting them to clarify and try to help us understand all of the amazing things that are in their head. I will often tell them too, “I love what you're saying. I don't see it on your paper, so I just want you to say it again. And I'm going to write it down on a piece of paper that makes sense to me so that I don't forget all of the cool things that you said.” And I'll just write it using more of a standard notation, whether that's a ratio table or a standard US algorithm or something. I'll write it to show the kid that thing that you're doing, there's a way that people write that down. And so, then we can compare our notations and try and figure out “What's the thing that you did?,” “How does that compare to the thing that I did?,” “Do I understand you clearly now?” to make sure that the kid has the right to say the thing she wants to say in the way that she wants to say it, and then I can still make sense of it in my own way. It's not a problem for me to write it differently as long as we're speaking the same language. Mike: I want to mark something really important, and I don't want it to get lost for folks. One of the things that jumped out is the moves that you were describing. You could potentially take up those moves if you really were unsure of how a student were thinking, if you had a general notion but you had some questions, or if you totally already understood what the student was doing. Those are questions that aren't just reserved for the point in time when you don't understand—they're actually good questions regardless of whether you fully understand it or don't understand it at all. Did I get that right? Ryan: Yes. I think that's exactly the point. One thing that I am careful of is, sometimes kids will ask me a question that I know the answer to, and there's this thing that we do as teachers where we're like, “I'm not sure. Why don't you help me figure that out?”—when the kid knows full well that you know the answer.  And so, trying not to patronize kids with those questions, but to really show that I'm asking you these questions, not because I'm patronizing you. I'm asking these questions because I am truly curious about what you're thinking inside and all of the ideas that surround the things that you've written on your paper, or the things that you've said to your partner, to truly honor that the more I know about you, the better teacher I can be for you. Mike: So, in addition to naming the situation, one of the things that jumped out for me—particularly as you were talking about the students—is, what do you think the impact is on a student's thinking? But also their mathematical identity, or even the set of classroom norms, when they experience this type of questioning or these [types] of questions? Ryan: So, I think I talked a little bit about normalizing the [questions] “Why?” or “How do you know that?” And so, just letting that become a classroom norm I think is a sea-changing moment for a lot of classrooms—that the conversation is just different if the kids know they have to justify their thinking whether they're right or wrong. Half the time, if they are incorrect, they'll be able to correct themselves as they're talking it through with you. So, kids can be freed up when they're allowed to use their expertise in ways that allow them to understand that the point of math is to truly make sense of it so that when you go out into the world, you understand the situation, and you have different tools to attack it.  So, what's the way that we can create an environment that allows them to truly see themselves as mathematical thinkers? And to let them know that “Your grades in other classes don't tell me much about you as a mathematician. I want to learn what really works for you, and I want to try and figure out where you struggle. And both of those things are important to me because we can use them in concert with each other. So, if I know the things you do well, I can use those to help me build a plan of instruction that will take you further in your understandings.”  I think that one of the things that is really important is for kids to understand that we don't do math because we want a good grade. I think a lot of people think that the point of math is to get a good grade or to pass a test or to get into the college that you want to get into, or because sixth grade teachers want you to know this. I really want kids to understand that math is a fantastic language to use out in the world, and there are ways that we can interpret things around us if we understand some pretty basic math. And so how do we get them to stop thinking that math is about right answers and next year and to get the job I want? Well, those things may be true, but that's not the real meaning of math. Math is a way that we can live life. And so, if we don't help them understand the connections between the things that they're doing on a worksheet or in a workbook page, if we don't connect those things to the real world, what's the meaning? What's the point for them? And how do we keep them engaged in wanting to know more mathematics?  So, really getting kids to think about who they are as people and how math can help them live the life that they want to live. Creating classroom environments that have routines in place that support kids in thinking in ways that will move them forward in their mathematical understanding. Trying to help them see that there's no such thing as “a math person” or “not a math person.” That everybody has to do math. You do math all the time. You just might not even know that you're doing math. So, I think all of those ideas are really important. And the more curious I can be about students, maybe the more curious they'll be about the math. Mike: You're making me think that this experience of making sense of someone else's reasoning has a lot of value for students. And I'm wondering how you've seen educators have students engage and make sense of their peer strategies. Ryan: Yeah. One of the things that I love to see teachers doing is using students' work as the conversation starter. I often, in my classroom, when I started doing this work, I would bring children up to the overhead projector or the document camera. And they would kind of do a show and tell and just say, “I did this and then I did this, and then I did this thing next.” And I would say, “That's really great, thank you.” And I'd bring up the next student. And it kind of became a show-and-tell-type situation. And I would look at the faces of the other kids in the room, and they would kind of just either be completely checked out or sitting there like raising their hand excitedly—“I want to share mine, I want to share mine.” And what I realized was, that there was really only one person who was engaged in that show-and-tell manner, and that was the person who was sharing their work. And so, I thought, “How can I change that?” So, I saw a lot of really amazing teachers across my career. And the thing that I saw that I appreciated the most is that when a piece of student work is shared, the person who really shouldn't talk is the person who created the work because they already know the work. What we need to do as a group is we need to investigate, “What happened here on this paper?” “Why do you think they made the moves that they made? And how could that help us understand math, our own math, in a different way?” And so, getting kids to look in at other kids' work, and not just saying, “Oh, Mike, how do you understand Ryan's work?” It's “Mike, can you get us started?” And then you say the first thing, and then I say, “OK, let's stop. Let's make sure that we've got this right.” And then we go to the kid whose work it is and say, “Are we on the right track? Are we understanding what you're …?” So, we're always checking with that expert. We're making sure they have the last word, because It's not my strategy. I didn't create it. Just because I'm the teacher doesn't mean you should come and ask me about this because this is Mike's strategy. So go and ask the person who created that.  So, trying to get them to understand that we all need to engage in each other's work. We all need to see the connections. We can learn from each other. And there's an expectation that everyone shares, right? So, it's not just the first kid who raises his hand. It's “All of you are going to get a chance to share.” And I think the really powerful thing is I've done this work even with in-service teachers. And so, when we look at samples of student work, what's fascinating is it just happens naturally because the kid's not in the room. We can't have that kid do a show and tell. We have to interpret their work. And so, trying to look at the kid's work and imagine, “What are the types of things we think this child is doing?,” “What do we think the strengths are on this paper?,” “What questions would you ask?,” “What would you do next?,” is such an interesting thing to do when the child isn't in the room. But when I'm with students, it's just fascinating to watch the kid whose work is on display just shine, even though they're not saying a word, because they just say, “Huh.” They get it. They understand what I did and why I did it.  I think that it's really important for us not just to have kids walk up to the board and do board work and just solve a problem using the steps that they've memorized or just go up and do a show and tell, [but] to really engage everyone in that process so that we're all learning. We're not just kind of checking out or waiting for our turn to talk. Mike: OK, you were talking about the ways that an educator can see how a student was thinking or the ways that an educator could place student work in front of other students and have them try to make sense of it. I wonder if there are any educational technology tools that you've seen that might help an educator who's trying to either understand their students' thinking or put it out for their students to understand one another's thinking. Ryan: Yeah, there's so many different pieces of technology and things out there. It's kind of overwhelming to try and figure out which one is which. So, I mean, I've seen people use things like Nearpod or Pear Deck—some of those kind of common technologies that you'll see when people do an educational technology class or a workshop at a conference or something. I've seen a lot of people lately using GeoGebra to create applets that they can use with their kids. One that I've started using a lot recently is Magma Math. Magma Math is great. I've used this with teachers and professional development situations to look at samples of student work because the thing that Magma has that I haven't seen in a lot of other technologies is there's a playback function. So, I can look at a static piece of finished work, but I can also rewind, and as the child works in this program, it records it. So, I can watch in real time what the child does. And so, if I can't understand the work because things are kind of sporadically all over the page, I can just rewatch the order that the child put something onto the page. And I think that's a really great feature.  There's just all these technologies that offer us opportunities to do things that I couldn't do at the beginning of my career or I didn't know how to do. And the technology facilitates that. And it's not just putting kids on an iPad so they can shoot lasers at the alien that's invading by saying, “8 times 5 is 40,” and the alien magically blows up. How does that teach us anything? But some of these technologies really allow us to dig deeply into a sample of work that students have finished or inquire into, “How did that happen and why did that happen?” And the technologies are just getting smarter and smarter, and they're listening to teachers saying, “It would be really helpful if we could do this or if we could do that.” And so, I think there are a lot of resources out there—sometimes too many, almost an embarrassment of riches. So, trying to figure out which ones are the ones that are actually worth our time, and how do we fund that in a school district or in a school so that teachers aren't paying for these pieces out of their pocket. Mike: You know what? I think that's a great place to stop. Ryan, thank you so much for joining us. It has been an absolute pleasure talking with you. Ryan: It's always great to talk to you, Mike. Thanks for all you do. Mike: This podcast is brought to you by The Math Learning Center and the Maier Math Foundation, dedicated to inspiring and enabling all individuals to discover and develop their mathematical confidence and ability. © 2025 The Math Learning Center | www.mathlearningcenter.org  

https://www.listennotes.com/podcasts/chit-chat-stocks/the-future-of-artificial-3ylaqngtMR7/[00:00:00]intro: Welcome to Chitchat Stocks on this show host Ryan Henderson and Brett Schaefer analyze businesses and riff on the world of investing. As a quick reminder, Chitchat Stocks is a CCM media group podcast. Anything discussed on Chitchat Stocks by Ryan, Brett, or any other podcast guest is not formal advice or recommendation.intro: Now, please enjoy this episode.Brett: Welcome in. We have another episode of the Chitchat Stocks podcast for you this week. We have a fantastic interview coming up with Shawn Wang from LatentSpace. It is a, I'll say covering anything AI. A lot of the stuff, you know, for me and Ryan, it might be going over our heads and it might be a little too hard technically for us, but that's what we brought on Shawn to the show today.Brett: For a lot of public market investors, this new [00:01:00] AI stuff, it's hard to You know, see what is, what is working, what's just a narrative, what all the stuff that's getting thrown at us during this boom times. So Shawn, we wanted to bring you back on the show. You came on, I think almost exactly two years ago now to talk more cloud stuff.Brett: Now we're really going to talk about cloud AI and how it is impacting the startup ecosystem. So Shawn, as we kick off the show. What is your relevant expertise in this booming AI field? swyx: Oh God, that's the million dollar question here. So I am so for, for listeners who haven't heard back the previous episode that I was on I was finance and public markets guy.swyx: And I was, I was in a hedge fund for my first career. And then I changed careers to tech where I worked at AWS and three unicorn Sort of developer tooling cloud startups. My relevant expertise is you know, on, on some [00:02:00] level, I, I'm just a software engineer that is building with AI now. And then on another level, I had, I actually, when I was an options trader back in the sales side, I actually did a lot of natural language processing of the Bloomberg chats.swyx: So I fed all of the Bloomberg chats into a pricing mechanism. Then built our global pricer. So our entire options desk was running off of that thing. This was about 13 years ago. So so you know, I, I've always had some involvement with like AI, but like, you know, it was never a big part of my identity and I think.swyx: The more foundation models came into focus, and foundation models is a very special term as opposed to traditional, maybe machine learning finance that a lot of your listeners might be familiar with then you start to build differently, and there the traditional software engineering skills become a lot more relevant.swyx: So relevant expertise now is that I, I guess I've sort of popularized and created the term of AI engineer, which you can talk about and created the industry such that Gartner now considers, considers [00:03:00] it like the peak of its hype right now. And I, I consider that both a point of success and also a challenge because I have to prove Gartner wrong that it has not peaked, but you know, they put us at the top of the hype cycle, which is kind of funny.swyx: Because I started it, so. Ryan: Yeah, it's it's a unique challenge but yeah, funny anecdote. Okay, so a lot has changed since we last spoke. Yeah. Pretty much this whole world of AI that everyone's talking about now or at least has become mainstream has, I believe that kind of kicked off right after the discussion or our last discussion.Ryan: So I guess the last discussion was really focused on the cloud computing industry broadly. And that was actually right around the time when AWS. Azure, GCP all the revenue growth rates were coming down and actually now with the hindsight bottoming. So my question for you is what has, I guess, [00:04:00] what has changed over the last two years and why has revenue growth at the big cloud providers re accelerated?swyx: Yeah, again, like, revenue growth at big cloud providers is due to factors that, you know, probably I don't have a full appreciation of. I also challenge the fact, the idea that everything has changed. You know, I think in some ways, this is just like the next wave of something that was just a broader, maybe like 20, 30 year long trend anyway.swyx: You know, we, we needed more cloud compute. Now we need even more cloud compute. Now we need more GPUs in the cloud instead of CPUs, right? Like, what's really changed? I don't know. Like, you know, people still want serverless everything. People still want orchestration. People still want you know, unlimited storage and bandwidth and all the sort of core components of cloud.swyx: In that sense, it hasn't really changed. I do think that if you see there are plots over time of the amount of money and flops invested in machine learning models, that actually used to follow a pretty log linear Moore's law type growth chart for the last like 40 years. [00:05:00] And then, You had 2022 happen and now everyone's like, oh, you can train foundation models now.swyx: And actually you've seen a big inflection upwards in the amounts that people are throwing in throwing the money in there just because they see the money now. So like every, it's like obvious to everyone, including us, including me in a way that it wasn't obvious to basically everyone, but Sam Altman and Satya Nadella circa 2019.swyx: Like they knew this. Four years five years ahead of everyone else. And that's why they went big on OpenAI. But now that we see this, obviously everyone's throwing money into NVIDIA, basically. Brett: I had, why, why are, and this is maybe a question I think I know, but I'd like the answer again, and it feels like it's maybe a basic question, but a lot of, I think listeners are going to want to kind of understand this connection.Brett: Why do these new AI companies require so much upfront spending? On NVIDIA chips, cloud computing costs. All that stuff. swyx: Yeah. I mean, so [00:06:00] you have to split it by whether you're a foundation model lab or you're basically everyone else that consumes foundation models. So the rough estimate for, let's say GPT 3 was like 50 million to a hundred million in compute for one run.swyx: And for every one successful final training run, maybe you have between a hundred to a thousand. Prior runs before that, right? So just pure R& D. The estimate for GPT 4 was 500 million. We've actually had two generations of frontier models since then, just for OpenAI. So that would be GPT 4. 0 and GPT those are the models that, those are only, only the models they've released.swyx: And also not, those are only the text models, we haven't counted the video models and all the other stuff. So it's just a lot of upfront investment, right? Like, I think it's, it's like the classic capital fixed costs upfront thing, where, you know, you have a pre training phase where you're just consuming all of the internet.swyx: [00:07:00] Data that's, you know, there's nuances to that, but we won't go into that. And, and, Alka, Alka comes the other end, you know, 3 to 6 months later, Alka comes a model that you then spend another 6 months fine tuning and red teaming, and post training, and then it's ready for release. So, like, so there...

As entrepreneurs, we have the ability to make a difference in the world and in those we serve by aligning our  In this episode of the #DoorGrowShow, property management growth expert Jason Hull sits down with Ryan Pineda, real estate investing expert and author of The Wealthy Way to talk about real estate, business, and faith. You'll Learn [01:34] Getting Started in Entrepreneurship [08:07] Faith and Business [17:16] Having Impact as a Business Owner [29:50] You are What You Consume [45:35] Don't Wait to do the Work Tweetables  ”There's no more efficient business model for positively changing the world than business.” “ When you start becoming process-driven more than results-driven, your life changes.” “ We should expect things to be hard and worth it.” “ You are what you consume in all areas of life.” Resources DoorGrow and Scale Mastermind DoorGrow Academy DoorGrow on YouTube DoorGrowClub DoorGrowLive TalkRoute Referral Link Transcript [00:00:00] Jason: There's so much wisdom in there and if you can at least just be willing to extract wisdom wherever you can find it, then you're not an idiot And so at least start there, everybody listening, just look for wisdom, be a seeker of wisdom and look for the things that are better and higher.  [00:00:16] Welcome DoorGrow property managers to the DoorGrow show. If you are a property management entrepreneur that wants to add doors, make a difference, increase revenue, help others, impact lives, and you are interested in growing in business and life, and you're open to doing things a bit differently, then you are a DoorGrow property manager. [00:00:34] DoorGrow property managers love the opportunities, daily variety, unique challenges and freedom that property management brings. Many in real estate think you're crazy for doing it. You think they're crazy for not because you realize that property management is the ultimate, high trust gateway to real estate deals, relationships, and residual income. [00:00:54] At DoorGrow, we are on a mission to transform property management business owners and their businesses. We want to transform the industry, eliminate the BS, build awareness, change perception, expand the market, and help the best property management entrepreneurs win. I'm your host, property management growth expert, Jason Hull, the founder and CEO of DoorGrow. [00:01:13] Now let's get into the show.  [00:01:17] So my guest today, I am honored to hang out with Ryan Pineda. Ryan, welcome to the show.  [00:01:22] Ryan: Hey, happy to be here. Good to see you.  [00:01:25] Jason: So Ryan, I'd love to kick things off by getting into your background of how you kind of got into this journey of entrepreneurship. But before we do that, your company's called Wealthy Investor, right? [00:01:36] Yep. And you've worked with a lot of real estate investors. My target audience listening to the show are usually the vehicle or the support mechanism for a lot of investors. I think the audience would be interested in hearing a little bit about how you got kind of started into entrepreneurism first of all, and then maybe how you got into real estate. [00:01:57] Ryan: Yeah, I'll give the quick story. You know, I never wanted to get into real estate or entrepreneurship. I was a baseball player growing up and that was all I wanted to do. I was grateful and thankful that I was able to actually do that. You know, I ended up getting drafted by the Oakland A's and got to play professional baseball for eight years. [00:02:15] But, I didn't get paid much in the minor leagues. I never made it to the bigs. I was making 1200 bucks a month. And so I had to make money elsewhere. And that's what led me in entrepreneurship. You know, I got my real estate license in 2010. Yep. And, you know, so I've been in the game for about 15 years now. [00:02:32] And, you know, I've seen a lot. You know, started as an agent and hated it. My mom was actually a property manager. I didn't tell you that. So, I watched her do that for a little bit while being an agent as well. So she was an agent herself, but you know, watching her, I had no desire to be an agent or do anything in real estate because when I got in in 2010, she had just lost everything. [00:02:53] You know, and she's like, you need to get like a safe job. You need to get something that has a salary and a pension. That was literally her advice. Well, and I was like, yeah, maybe, I don't know. Hopefully this baseball thing works out. But while I'm playing, I can't get that. So I'm going to have to do something. [00:03:11] So anyways, I become an agent. Hate it. Do it for a few years. Ended up getting into other weird things. I started flipping couches. I was a substitute teacher. I was just doing anything that could make a buck on the side. And then eventually that led to flipping houses in 2015. [00:03:27] And that was when I, for the first time, started to make some real money. And yeah, I mean, by my third year, I had made, you know, I became a millionaire after year three, flipping houses. And it was just like, wow, this is crazy. And since then I flipped, you know, I think almost 600, 700 homes. And. You know, I've bought rentals. [00:03:47] I own apartment buildings through our syndication. You know, we've coached people, like you said, with wealthy investor. We've coached thousands of students and held really big events. You know, I've started another subsidiary businesses for real estate investors. You know, we have a lead generation company called Lead Kitchen where we help them get leads for sellers. [00:04:05] We have, you know, I had a tax firm, you know, I've kind of done almost everything you can imagine in the real estate world, but  [00:04:10] Jason: Yeah, that's a lot. So I'm curious you said your mom was a property manager and she gave you the advice It was kind of like maybe steer clear of this stuff. [00:04:19] What does your mom think now about everything?  [00:04:22] Ryan: You know what? She's still always hyper cautious so, you know, I retired my parents in 2019 I bought him a house bought him all the cars and everything and my dad actually started working for me in 2018 as a project manager. So he would oversee a lot of our flips and even to this day, he still does it. [00:04:42] Not cause he has to, because he's just like, well, if you're going to, you know, pay for us, I might as well like earn it, you know, and he just wants to support and whatever. So, You know, my dad understands the game. My mom though, obviously she's seen the results, but she's still always hyper cautious. [00:04:57] And so, she doesn't think I need to get a job now, but she does think a lot of times the big risk I take, I shouldn't be taking.  [00:05:05] Jason: Yeah. Looking back, when do you see in hindsight that there were clues that you were maybe destined to be an entrepreneur? Maybe even doing baseball. [00:05:16] Ryan: Yeah. I look back in hindsight, even as a kid and I was always buying and selling and thinking about money. Like I started an eBay account when I was like 12 years old. I remember. You know, buying stuff and bidding on stuff and getting good deals on eBay. And then I remember I was selling Pokemon cards and Yu Gi Oh cards, you know, in middle school and stuff. [00:05:37] And it's just like, You know, the signs were always there. And then even I was always attracted to just making money myself. So like I was good at poker, you know, I won poker tournaments and I played online and I made money that way. And so in hindsight, it was always very clear. I was never going to have a job. [00:05:53] Really the only true job I ever had was playing baseball. And even then it's like, yeah, there's not really a way to be an entrepreneur. I mean, you kind of are you're in charge of your career and how well you want to do and like how well you want to train and. And so, yeah, even in that sense, baseball is kind of in that same vein. [00:06:12] Jason: Yeah. So I'm sure even to get as far as you got in baseball, there was a lot of drive involved and a lot of effort involved, even though there wasn't a lot of pay, it sounds like.  [00:06:25] Ryan: Yeah, I think yeah, for me, like, I had to learn how to like win, you know, at the end of the day, losing is not an option, right? [00:06:33] It's a zero sum game in sports. One person wins, one person loses, you know, for the pitcher to succeed, you must get out. And so, dude, I'm like, I'm going to just figure out how to win. I'm competitive. And so I think competitiveness has always fueled me. It's different in business now because I understand the games that we play. [00:06:52] It's like, you know, We both can have good podcasts. We both can win in business. You don't need to lose for me to win. But that doesn't mean I'm still not competitive.  [00:07:00] Jason: Sure. Yeah. I'm sure in the different industries that you have businesses that you focus on, you have competitors and you probably want to win. [00:07:09] Ryan: I don't want to lose.  [00:07:11] Jason: Right. I want to be the best. I think that's true of most entrepreneurs. There's this drive or, this bite to win. You know, I remember early on, I think some of my first clues as to that I might be an entrepreneur is I was into music. And I remember in college, I was going around door to door pre selling CDs so that I could fund doing an album. [00:07:31] And yet I still at the time was thinking I've got to get a degree to get some sort of job to rise the corporate ladder. And I had no clue that entrepreneurism was like a path at the time. So it's interesting and Entrepreneurism sort of found me In that I needed a way to not be doing a nine to five job to be able to take care of kids because I ended up as a single father right and divorced and like went through all this stuff. [00:07:57] And so I was like, all right, what can I do? And so I sometimes joke that my kids turned me into an entrepreneur. It was just what needed to be done, but there were always clues before, right? So you know, one of the things that you've talked about a lot, I've noticed on your social media, on podcasts is you're very faith forward. [00:08:15] Like you're very comfortable talking about your faith and like the things that kind of motivate you and drive you. And you're involved in some charitable sort of, you know, businesses or charitable entities or organizations as well. How does faith sort of play into all of this when it comes to business for you? [00:08:33] Ryan: Well, you know, I grew up in the church. So, you know, for those who don't know, I'm a Christian. And you know, I grew up in a baptist church and you know, faith was always a part of my life. And I felt like for the most part, I did things the way God wanted me to. You know, I didn't really rebel and go crazy in college, got married young. [00:08:51] You know, I've always tried to put God first and everything. And You know, I think in the last couple of years, God was just pushing me to get even more deep in faith and more bold and to really embrace the spiritual and supernatural side of faith because I was always a very theologically sound person. [00:09:11] And you know, I've read the Bible many times, and, you know, I spent a lot of time, like I said, in church and serving and other things, but you just realize in everything in life, especially with faith, that there's so little that you actually know, and you know, as I've grown in my faith, I've learned to hear from God better. [00:09:29] And tune out all the noise of everything else going out in life, right? I mean, there's so many distractions in life. There's your business, there's social media, there's your kids, your family, you know, the recession, the election, it's like distraction. I think that's Satan's biggest, yeah, that's Satan's biggest tool is to distract you from the truth. [00:09:49] And so the truth was God wanted me to get more bold and to really use my platform for him, not for me. And, you know, with that, I became convicted to just really go all in because I mean, one thing I guess people would notice about my career too, is like, there's no really lukewarmness, you know, when I go all in on something. [00:10:09] It's like, yo, if we're going to throw an event, it's going to be crazy. If we're going to start this, we're going on a blitz. And so I said, you know what, we need to start something for Christian entrepreneurs and Christian business people. And so, you know, I created Wealthy Kingdom last year and you know, we're a nonprofit and, you know, we have three goals. [00:10:27] Well, I shouldn't say three goals. The one goal, the mission is to bring the kingdom to the marketplace. And what I mean by that is so many entrepreneurs just think it's the church's job to, you know, go get people saved and to go disciple people. And it's like, yeah, you know, just invite them to church on Sunday. [00:10:44] It's like, no, our job, every Christian has this goal or mission. You know, Jesus tells us right before he left, he said that the mission here is you need to go make disciples of all nations. We all have that same mission. And it's like, it's not to make the most money. It's not to do the thing that you love. [00:11:05] Like, Jesus never said do the thing that you love. Like that's another big lie that, you know, people have been told.  [00:11:12] Jason: Jesus didn't even do what he loved necessarily. Like to a degree, he said, I don't even do my own will. Yeah. He does the will of him who sent me. Right. He's like, I'm not even doing my own will. [00:11:22] And so if that's a model, then maybe it's not about just selfishly doing our own will all the time.  [00:11:29] Ryan: Absolutely should not. Our will, as we grow should be more aligned with the father's will. And that's what sanctification is. So anyways, to, to long story short. God called us to go be disciples where we're at. [00:11:42] We don't like, we need to go make disciples of all nations right now. That's in our job, in our career, in our business, at an event, whatever. And so I took that to heart. So we started you know, looking at everything that we currently do. And we said, well, let's do it for the King. And so I said, all right, well, let's get a kingdom based community. [00:12:01] And so, you know, we started an online community because that's something we currently do in business. It's like, well, let's get one kingdom based. And so we have that it's completely free. Anyone can join it. Then I said, let's throw events. We throw a lot of events. Why are we not throwing kingdom events? [00:12:14] And so we started throwing big events for the kingdom. And in fact, in my secular events, I just started throwing worship services and pastors in the middle of the event without even telling anyone. Because I'm like, look, this might be the only time they ever hear the good news in their entire life. [00:12:31] And, you know, whatever they might like it, they might not like it, but I don't really care. They need to hear it. And so we started incorporating faith into our events. You know, and then the last thing was really just discipling the current believers because I'm all about the lost. I want to get the lost at the events. [00:12:50] With our content, with our community, but also too, what about the people who are already saved? Well, we need to disciple them and make them better. And so we started running Bible studies all across the country. And I think we're close to a hundred, actually across the world right now, that meet every single week in people's offices, in their homes. [00:13:07] And we all go through the same studies together in these Bible studies, across as a body. And it's really cool. So, yeah, we're trying to attack it from a lot of different angles.  [00:13:18] Jason: It's a lot to organize.  [00:13:20] Ryan: Oh, yeah. But here's the thing, right? It's weird because I just said, Hey, don't do your will. Do God's will. [00:13:26] Right. But on the same hand, God gave us all talents, abilities and different life experiences. And so, you know, he calls us to use those to do his will and it's like all right god gave me a lot of influence online. Why am I not making videos and content, you know helping people understand what that means? [00:13:47] God gave me the ability to throw massive events. We threw wealth con every quarter a thousand plus people every quarter for years. Why am I not throwing massive events for the kingdom? God gave me the ability to organize communities and groups and all these things. Why am I not organizing and using my administrative gifts to do that? And it's like it's all the same thing, and they're all the same gifts and they're all the same skill sets, but on one hand you're putting him first and on the other hand you're putting yourself first  [00:14:16] Jason: Yeah, I love the idea of you know positively impacting the world I think business a lot of people don't realize I think business really there's no more efficient business model for positively changing the world than business, right? [00:14:31] I don't think charities don't function as well like businesses. There's an exchange of value And if there's value like behind it and there's a mission and a purpose behind it Then even the team members the employees everybody Are more lit up and excited and so business is a very efficient business model and you know, one of my past mentors, Alex Charfen, and he would say something to the effect of like entrepreneurs are the people that have changed the world throughout history. [00:14:57] They're the people that kind of think differently. And you know, you mentioned the word disciple like several times and I love the scripture where it's like, how do you know who's a disciple, right? And it's by this shall men know, right? You're my disciple. If you have loved one towards another and I think you know this spreading this message of like sharing true principles Which I think is what makes scripture, right? [00:15:20] It's that there's true principles that can be applied to things that are useful and I think a really good business book will have maybe one key principle it teaches, but then you take a book like the bible and it's just full of lots of different instances of principles that these levers that you can apply to various situations in your life or in decision making. [00:15:39] And you know, that's always been sort of my purpose, I feel is to bring principles to people and to share principles of truth to others, because I feel like that's the easiest lever to impact people's mindset or change their lives is to bring some truth or light or some true principles that they can apply, especially if it's facilitating more love or more kindness. [00:16:01] And there's so many different things different principles that apply in business in order to figure things out like related hiring related to you know running an efficient business  [00:16:11] Ryan: How do you know like a non profit is a business right? I mean, it's a non profit.  [00:16:15] Jason: Yeah, it is. It is a business. Yeah. [00:16:17] Ryan: A church is a business technically based on its designation, Wealthy Kingdom is a business. [00:16:22] It's a nonprofit, right? I mean, in many cases, well, I shouldn't say this because every nonprofit's different, but like for me, I make literally nothing from it. You know, I do it out of a, you know, I just want to do it. Now we have employees, we have staff, we have marketing, we have event costs, we got to pay for all this stuff. [00:16:38] Right. And so we got to figure out, man, how do we use the resources we have in the best way possible? Well, it's the same thing we ask ourself every day in business. We have a limited amount of labor, a limited amount of capital, a limited amount of time. What do we do, you know, to make the most of it? So it's all the same. [00:16:57] And I think too, right, you don't even have to have a nonprofit for this to be the example, right? This is just simply the idea of stewardship. You know, God talks a lot about stewardship and it's like, well. I've given y'all different varying degrees of talent. I've put y'all in different places. Y'all are going to be judged accordingly based on how you used your talent. [00:17:16] And I think that, well, I know that 1, 000, and a lot of Christians don't realize this. A lot of Christians, so, for all the Christians on the show, this is going to hopefully convict you, okay? A lot of people think that when you get saved, that's the end of the journey. Yeah, when literally that is like they've arrived they're done. [00:17:39] You just started! Great! [00:17:41] Jason: Yeah.  [00:17:41] Ryan: Now guess what you your whole rest of your life now actually begins and so many people like, God tells us that hey, guess what? Once you're saved, you know, there's a new judgment now. Because before it was like, all right, what happens in eternity, right? You're going to be in heaven. [00:17:58] You're going to be in hell. That's like the salvation question, but then there's this next question about judgment and stewardship and what you did with what he gave you because Somebody like myself and you will be judged more harshly than other christians and people are like, what does that mean? [00:18:18] Well, it means that if he gave you more resource and he even says if you're a teacher and you cause other people to stumble, you are going to be judged significantly more harshly than others. And so I take that super serious because I'm like, all right, yeah, I'm saved. I'm not worried about that, but man, I better do everything in my power to be a great steward and to understand if I have influence and I'm teaching people, I know exactly what I'm saying. [00:18:44] Jason: Yeah, it's much like the Parable of the Talents, you know, the worst was like to try and bury it and hide it, hide the money. The person that did the best with the money that he trusted with the most money, like, made twice as much money, like, he increased it significantly, right?  [00:19:00] Ryan: And he was also given the person's talent that, who buried his talent. [00:19:04] Jason: Exactly. He's like, I'm going to take it away from you because you don't know how to use this or how to deal with it. And so I think there's a nice summation of business in that for us, like where much is given, much is required and yeah, I've got a little bit of an audience. [00:19:18] You've got a little bit of an audience as well, right? We've got these audiences and people are listening, people pay attention to what we're doing And you know, we have a ripple effect. And I have a ripple effect through my clients who have a ripple effect through all the families that they support, the investors, the team members that they have. And that's significant and to me, that's exciting. Like, that's what motivates me to do what I do. [00:19:43] That's inspiring. But yeah, I could see that some people would maybe it would convict them. Maybe they would feel maybe they feel a little ashamed if they thought about it, man, you know, the energy I'm putting out into the world and in the universe here, isn't the ripple that I really feel is the best ripple I could create. [00:19:59] Ryan: Well, the other part, too, is obviously we have ripples here on Earth, but, you know, there are ripples for eternity based on our decisions for the people we help and everything else, and, you know, the Bible talks about how, you know, you store up your treasures in heaven, and if you read, you know, a lot of Christians also don't know this, they think that Heaven is this place where everybody's equal and, you know, we're all in the same thing. [00:20:25] No, it's actually not like there's hierarchies in heaven there. Like it's clear when the disciples are talking to Jesus and they're like, man, dude, I want to sit on your right hand. He's like, you don't even know what you're asking for. And. you know, they're clearly trying to be in that inner circle after this too. [00:20:43] And, you know, you could read all about it. There's hierarchy with demons. There's hierarchy with angels. Hierarchy is going to be in heaven. It's already there. And it's like, you know, you got a lot of investors on this podcast who are like, Oh man, I got to invest for the future. I got to get my net worth here. [00:21:01] I got to get my cashflow here. I got to. And it's like, we're investing trying to build for the future of this life. And once you truly understand that this life is so short in the span of eternity, you start thinking very differently. And you're like, well, I would rather invest for eternity. And actually, we just read this book in our Wealthy Kingdom group. [00:21:21] It's called Driven by Eternity by John Bevere. It's a great, one of the most convicting books I've ever read. But, he goes, alright. He's like, I learned this in math. Anything divided by infinity is infinity. And it's like, eternity is infinity, right? But if you were to try and even just, finitely say it with our brains, let's just say the next 24 hours, we're going to dictate the next thousand years of your reward here on earth, right? [00:21:48] How you spent the next 24 hours would dictate what reward you got for the next thousand years. You'd be like, that's insane, right? That doesn't seem right. That, you know, this is going to be  [00:22:00] Jason: proportionately skewed. To this moment. Yeah, it's- [00:22:04] Ryan: that's not even close to infinity.  [00:22:07] Jason: Yeah.  [00:22:08] Ryan: We spend 100 years here on this earth thinking we have all this time. In the scheme of infinity, it's worse than way where it could be 24 hours to 10, 000 years to a million years, a billion years. It's still not infinity. And yeah, people just don't, they don't think about it because it's so hard to grasp. But it's like I wish and this is why god has you know kind of got me more vocal about it. [00:22:33] So we're talking about it now But it's like I want investors because I'm an investor right now, you know, like I'm always looking for the best investment I'm always looking for the best use of my time, but I want people to start thinking about man, Invest for eternity. That's way longer than this! Your retirement is way shorter than infinity and eternity. [00:22:54] Jason: Though, could Jesus be a house flipper in the eternities? Because he says in my father's house, there's many mansions, right? And he said, I'm going to prepare something for you guys. And so I think what you're talking about is maybe we should be paying a little less attention maybe to just our real estate assets and our investing here and maybe do some heavenly real estate investing. [00:23:17] Ryan: I'm being 1, 000, that's 1, 000 percent what I'm saying. And it's changed my mindset so much in the last year that I could care less about my net worth. I could care less about how many properties I own. I could care less about any of it. Because eternity is so much greater.  [00:23:36] Jason: So some people might be saying, Ryan, come on. [00:23:38] You're wealthy now. You run Wealthy Investor. You've got money. So it's easy for you to say that. What would you say to the naysayers?  [00:23:46] Ryan: I would say that I've had a certain level of contentness, no matter how much money I had. I made 1200 bucks my entire 20s a month. Okay. So like, I understand what it is to have nothing. [00:23:57] And you know, people always make an excuse, right? It's like, I got three kids and a wife, five, five and under, man, I got a special needs son. I spend a lot of time with my kids. And it's like, well, you know, that's cause you, everybody's default is that's cause you have money or this or that. [00:24:14] It's like, no, all these things were built with nothing. They were all built simultaneously. It wasn't that, oh, this came after that. It's like, no, they were all built in the same construct. So people just need to realize it's just an excuse. It's a cop out. Right. And the other part too, is it's just a fact of not trusting what the Bible says. [00:24:33] So if you're not Christian- [00:24:34] Jason: which essentially is just not trusting God,  [00:24:37] Ryan: Yeah, and if you're not Christian and you don't believe it, that's one thing. But if you are a Christian, you cannot say that you are a Christian and then claim that. It is a lie. And it's like, if you read Matthew 6:33, seek first his kingdom and his righteousness, then everything else will be added to you. [00:24:54] And so this is where it comes into play of like, if I'm seeking those eternal rewards, everything else will be added to me. Now, does that mean I'm going to be a hundred millionaire billionaire own all these prop-? No, but I do know I'm going to be just fine here on earth. Like, I don't have to worry about that. [00:25:11] Like I'll be taken care of. It'll be added to me. So I just trust that promise.  [00:25:17] Jason: Yeah. I think I've always just trusted, even when money was tight, I've always trusted in my ability to figure things out and that God's going to take care of me. I just, I bought  [00:25:27] Ryan: money's been tight for me many times after I've been rich. [00:25:30] Jason: Yeah. Yeah.  [00:25:31] Ryan: Like so many times every business owner every you know, Elon Musk, dude I mean the richest man in the world, right? This guy struggles with money like, you know Yeah, dude, he had to buy Twitter for 50 billion dollars he didn't have 50 billion dollars just laying around It was like the last hour to figure out how to go buy that thing. You know, they tell the story of how he invested all of his, like, 300 million he got from PayPal into Tesla and SpaceX and they were going to both go bankrupt and not make it. [00:26:01] Yeah. So, you know, I guess it all just is, like, it comes back to this idea that people think that there's a certain amount of wealth that prevents you from, you know, ever having to work again. And that's not true. It's just not true. Like, it can all be taken from you instantly.  [00:26:16] Jason: So, here's a thought I have that I think might convict, as you say, you know, Christians or just other people that claim to believe in God. [00:26:24] Is one thing I've noticed is you know, especially among, I guess, poor christians or people that have money issues is that I've noticed this action of cursing reality while claiming to love god. It's like oh well this sucks and this and they're kind of they're negative about everything showing up in reality and my favorite name for God in a lot of instances is reality because he says I am what is I am the truth he's the ultimate and reality always wins God always ultimately wins and I don't think it's fair for a christian to claim, I'm like so like faithful to god yet I'm going to curse my reality and complain about reality and complain about how everything is and complain about my family and my spouse and my job and the world and everything else. And there's such a difference I think in people that are at odds with reality which reality will always win. Reality doesn't lie reality is what is and those that are actually in alignment with reality, and align their will to god. [00:27:29] What do you think of that?  [00:27:30] Ryan: Yeah, I mean look god has been here way before us and here's another thing. I tell people I'm just like, all right, look, you know Even if you're not a Christian, right? I think majority of people believe there is something after this life. People believe there is, you know, some supernatural thing. [00:27:47] Most people would believe in the afterlife and whatever. And then, you know, almost everyone agrees there was nothing and then there was something right. And we would call this the creation of the world. But you know, my belief is, you know, It's based on the Bible, and the Bible tells us that there was a supernatural world well before this physical world you know, God talks about there was angels, there was all these things happening well before he created the earth, and the earth is going to pass away, and then, you know, You know, it's going to be back to how it was. [00:28:16] And you know, it's like, and you know, there's going to be a new heaven, new earth, all these things, but my point with that is God was always, that's just the best he has always been. He will always will be. He will always like he's past, present, future. He's just all present. And you know, The other part I struggle with a lot of Christians is they just don't understand the power that they have. [00:28:44] You know, they walk in weakness. And in reality, it's like, Do you realize, an axe, Jesus said or not an axe, but in the Gospels, and then it happened, an axe. He said, look it's good that I'm leaving you, because you're going to get something far better than just me being here with you physically. You're going to get the Helper, and then an axe, they receive the Holy Spirit, literally God living within them, inside of them. [00:29:08] And it's like, you have literally the same God that has always been here, that created you, that created this world living inside of you, and you're worried? What would you ever be worried about? You know, just think like back to just metaphors, you know, would you ever be worried if like, you know financially if you had just like all this money just with you at all times? [00:29:31] No, you wouldn't be worried financially. Would you be worried for your physical safety if you had the most elite killers as bodyguards around you at all times? No, you wouldn't be worried about your safety. You know, like, we have something so much better than all of those things, and we're worried. [00:29:46] We think we can't do things. We don't trust.  [00:29:50] Jason: So this is a good question. Let's bring this back to entrepreneurism. How can people, maybe they don't believe in God, maybe they, they do, but how do they bring themselves, do you feel, and how do you do this? How do you bring yourself in alignment with this greater power for those that maybe can just believe that or towards the universe or the God that created it? [00:30:12] How do we start to get ourselves in alignment? So we know we're on the right path.  [00:30:15] Ryan: Well, this doesn't apply to just God. But this is just everything in life, right? You are what you consume. So if I consume junk food and crap, then, you know, I'm going to be fat and my energy will suck and all those things, right? [00:30:30] Or like for another example, right? If I consume the news all day, 24 seven, right? I'm probably going to be a very skeptical, not trusting person. I'm going to have biases, all these things. Yeah. If I consume entrepreneur content all day and I watch all these guys I'm probably just going to be thinking about making money 24 seven, right? [00:30:48] You are what you consume in all areas of life and you know, you are the average of the five people you hang around with all of these things are a form of just what you consume And so if you want to become more like jesus you have to consume and get around people that are like Jesus. And so, you know, what does that look like? [00:31:05] Well, it looks like reading your Bible every day. It looks like praying every day. It looks like hanging around, you know, other Christians who are walking the walk. It looks like going to church on Sundays. It looks like listening to sermons, listening to worship music. You know, you just have to immerse yourself in it and consume it. And that's how you're going to become more aligned. It's crazy because like, I'll tell you this, and this could sound extreme to people, but it's like, you start to realize the rest of the things in the world that are deception, right? It's like, I used to not think rap music and things were like bad. [00:31:38] You know, I used to listen to gangster rap all the time, man. I love Tupac and all these guys. And then you start to just like, you know, they call me little Ryan. You know, you look, you listen to the lyrics, you know, from a different point of view and you're like, Oh my gosh, this is not good. This is crazy that I listened to this when I was a kid, I should not have been listening to this. [00:31:59] Right. Because you start to get convicted if you watch porn, it's like you're going to start looking at your wife a different way because you're just you're consuming the wrong things. Yeah. Yeah, and even little things start to convict you too. It's like, for the first time ever, we didn't celebrate Halloween this year. [00:32:15] Because I just became convicted that you know, its origins are demonic. And it's like, you just watch all of this stuff with it. And it's like, yeah, definitely none of this glorifies God. If it doesn't glorify God, why would I do it? You know? And it's like it glorifies demons and, you know, all of these dark things, it's like, that doesn't seem proper. [00:32:39] Jason: Yeah, like, you know, it's kind of that balance of how to be in the world, but not of the world, right? Like Jesus was hanging out with publicans and sinners and he was around people, but he also wasn't like just doing everything that they were doing. And so, yeah, I think that's an interesting concept. [00:32:53] I like, though, what you said about. And that wasn't even where my head was going, when I asked the question, but I love that you said like look at the people that you're choosing to be around. There's a consumption there and There's this book called the Dark Side of the Light Chasers it's by Debbie Ford and it's interesting because she talks about in it that we each have this golden side and we also have this dark side to us and the golden side Is the side of ourselves that we see reflected in others that we of the people that we look up to. And there's different people that kind of trigger that in us. [00:33:25] Some people, for example, like look at Donald Trump, very polarizing figure. Some people look at him and are very triggered and their dark side is triggered. They see a narcissist, they see all these negative attributes and then there's some that look at him and they're like, Oh, he's an entrepreneur or he's strong or he's masculine or whatever. [00:33:42] Right? And they look at the golden side. And I think what we see in other people and the people we choose to be around, we want to choose to be around people that we perceive as having a light. Somebody that has something that we want and attributes that we want to become more like. And I think choosing to do that, especially in choosing mentors, is important. [00:34:01] Because you're going to ultimately become a little bit more like them. And that doesn't mean every mentor that I choose is, like, ahead of me in every key area of life. But if they're at least in the area a little bit ahead of me in success in the area I'm getting coaching from then I'm going to absorb that but I'm careful not to take on everything else and to be discerning and to use discernment. [00:34:23] I think it's important like you said to be around people that you perceive as being a high caliber or people that you believe are moving towards greater light.  [00:34:33] Ryan: I agree with all of it.  [00:34:36] Jason: Love that. All right. So Ryan, what if somebody is listening to this and we talked a lot about like kind of faith, God, religion, stuff like this, and somebody who's like, okay, maybe I'm willing to entertain the idea that God exists. [00:34:54] Maybe Jesus is somebody I should like figure out, what would you say is a good first step for those people?  [00:35:02] Ryan: Well, you know, obviously like the Bible is the truth, right? That's God's revelation to us. And so a lot of people are like, well, I don't even know where to start with the Bible. I would say step one buy a study Bible. [00:35:13] So I would just go on Amazon. I would just, I would get an IV study Bible. It's very simple. So that way it has you know, just notes on the side for you to help you understand what it's saying and different questions. And so, you know, I have a study Bible right here. So this is, you know, maybe you can find this one on Amazon. [00:35:31] This is called the Quest Study Bible. Now, this Bible is like 15 years old. So maybe this one, they don't make this one anymore. But actually, I know they do make a version of it. It's not called the Quest Study Bible anymore, but just look at the NIV Study Bible. And I would start in Matthew. [00:35:44] That is the very beginning of the New Testament. I would just start in Matthew and read it all the way through. So, unlike other books where you start at the very beginning. You're going to start about two thirds of the way through in Matthew and just trust me, it'll make sense. So that would be step one. [00:35:58] Step two, I would say, you know, obviously you want to get plugged into a local church. That, that's a lot harder for somebody who doesn't know anything. So here's what I would advise is join us at Wealthy Kingdom. So it's wealthykingdom.Com. Everything's free. You can be a part of the community and you can get plugged into a Bible study with other entrepreneurs in your area or virtually. So that's going to be your best place to really build connections because you're going to also be around other people who understand the actual life that you live right now. And they're open. We have lots of non believers in our Bible studies who are there to learn, man. [00:36:34] They're like, look, I'm here to learn. I don't know. I don't believe. I don't even know what you believe, but I'm here to learn. And so we, we love those types of people. So I would, those would be the two steps I do because I don't know everybody here listening is listening to different things. So I don't know what local church you should go to or anything. [00:36:52] So come join us virtually. And then you're probably going to meet people in Wealthy Kingdom that are in your area, especially the local Bible study. And they're going to know what local church for you to go to.  [00:37:02] Jason: Got it. You know, this is maybe a controversial hot take of, mine But I feel like a lot of people get so caught up in trying even among christians or non christians trying to prove whether the bible and everything in it is factual history or not It's like facts and data. [00:37:19] They're trying to prove it and I think both sides miss sight of the most important elements, which is are there true principles that are applicable? Can you apply these things to your life? Are they useful tools? And I think that's the real measure of a principle, whether it's true or not, is you try it out. [00:37:38] You test this, try this on in your life and see if the fruit is good. See if it gives you positive results. Does it give you positive results to believe these things? Or does it cause, you know, does it take you in the opposite direction? Do you feel like you're moving towards something higher? Or is it taking you backwards? [00:37:57] Ryan: Yeah, there's biblical truth to that. You know, there was a reason Jesus performed miracles, you know, like a lot of people, a lot of people are like, well, why? Right? He could have just said all the things he said, hey, you know, don't steal. You know, follow the Ten Commandments. Love your neighbor. [00:38:13] Everybody can agree with those things. But it's like, yo. I'm going to make this person the lord of my life, which he was asking them to do, to believe that he's the son of God, to believe and give their entire life to him. It's like, well, dude, you better show me something else if you want me to commit to that degree. [00:38:31] And you know, that's why he performed signs and wonders to show them that, hey, look, I am the one. And You know, it's true, right? Like, that's why he did it. And that's why all of the disciples you know, were killed for preaching it well after he was gone, because they saw it, they believed, and they knew that the reward, you know, was going to be great eternally, right? [00:38:52] Look, Jesus says it to Doubting Thomas too, when he returns, right? A lot of the disciples believe, they're like, Oh dude, like he's back. And then Thomas is like, I ain't believing until I see him. Until I see the holes in his body. And so Jesus comes back and he's like, Look, Thomas, feel the hole, right? [00:39:08] Shows him the hole in his hands. And he's like, blessed are those who believe without seeing.  [00:39:12] Their faith is stronger, but still, it's all good that you needed to see to believe. Like, it's all good. And so. There are going to be people who listen to this and they're like, I believe all this makes sense. [00:39:26] And then there are going to be those who say no, I need to see the fruit. I need to see why I should believe. And in fact, I still believe miracles happen today. I've seen them with my own hands. I've prayed for miracles that cannot be explained other than they were miraculous. And you know, with that, it's like both happen. [00:39:43] Jason: I think that I think if we're really created in the image of God,. Then I think that is a clue that we might be a lot more powerful than we realize and you know there's even evidence that the placebo effect is getting stronger as time goes on. So like as they do drug testing and stuff like this drugs have to pass a certain test that they're stronger than placebo. The challenge is drugs are having a harder and harder time showing that they're stronger than placebo because the placebo effect is actually getting stronger. And I think that humanity worked our consciousness is raising a bit. [00:40:19] I think that people are realizing that we are creators, that we are more powerful than we give ourselves credit. And, you know, Jesus says, if you have faith, like a grain of a mustard seed, you could like move a mountain or something. Right. And so I think that I think there is something to, you know, this idea that we can create this positive future or alter our reality or alter things real time, like people's physical health or blessing people or different things. I do think that miracles can occur and there's evidence of it happening all the time. And I think in religion, see, I grew up Mormon. And I'm a very ultra conservative. [00:41:00] I was a Mormon missionary for two years and then eventually left it. I didn't even try alcohol until I was over 30. And I'm the only one in my family that, that left. I'm the black sheep and I'm the oldest of five boys. So, sorry mom, sorry dad.  [00:41:14] Ryan: I'm not happy with you.  [00:41:15] Jason: They still love me, but I think one of the things that I, and I'm grateful for all that I learned, like we, we did, I did a lot of religious study growing up and I was the one that just kept digging until I took my way out of it, I guess. [00:41:26] Ryan: Mormon apologetics is a tough thing to defend.  [00:41:30] Jason: Yeah. So I think you know, there's a lot of people think that they need to sell some sort of gospel or good news of, Jesus or the christian church by convincing people their life is going to suddenly be magical or better and that's not always true, and I don't think that's the whole point is that you don't magically make everything about your external circumstances in your life better, but I think being more in alignment with god and being more connected allows you this greater strength to weather what's happening. [00:42:02] I mean if you look at what happened to Peter or any of the apostles, like they suffered horrible deaths. I don't know that their life magically became more amazing because they followed Jesus, but they had that conviction and they knew truth. And I think in a lot of instances, becoming Christian or believing in Jesus or following his principles may make your life in some instances, more challenging, you know, maybe there's more fiery darts thrown at you by the adversary, for example, but I do believe that there's some sort of there's some sort of power and confidence that comes with knowing that your personal life and will is in alignment with God wants for you. [00:42:45] Like you're following that calling and that knowing within, and there's a strength that comes from that, that nobody else can shake. It doesn't matter like what your parents are saying to you. It doesn't matter what your spouse maybe is concerned about. It doesn't matter if you know, you're doing what is right, then you're willing to just let the consequences follow. [00:43:03] And that's different than just looking for this better life or a mansion here on earth instead of a mansion in heaven.  [00:43:10] Ryan: Yeah, and you know, Jesus said hey you got to pick up your cross and follow me. It's like picking up your cross literally means dying to your old self and giving your all to Jesus And you know somebody's like oh, but like I got to say bye and to my dad and I gotta bury and he's no. [00:43:27] No, this has nothing to do with your current family. This is about you and me You know, whether or not you're going to follow. And you know, I've met many Mormon, ex Mormons, Jews, Muslims, people who have given their life to Jesus. And you know, it's tough because there's so many family dynamics that go on to it. [00:43:46] And it's like, it ain't easy. And I feel for those people, cause that, that's very hard. But I also am a believer that, you know, through your faith and through, you know, those who make that commitment, they have the chance to impact their families. So much more and they can be sanctified through them. [00:44:02] Jason: Yeah, I mean I had a meeting with the mastermind this morning and we were talking about distractions And we were all these they're all men and we're all sharing like what's distracting us and what's holding us you know back from the things we should be doing and you know and I was thinking about you know, just how can I be a better father? [00:44:21] How can I be a better partner, a better spouse? How can it be a better business leader? And at the stage I'm at now, it's just more discipline. It's less distractions. And it's all like cutting out all of the fat and the little things that are so easily taking us. And that's kind of what you led us into here in the beginning. [00:44:39] You know, what do you, what would you say to those that are just, they're trying to run their business, they're dealing with a lot of distractions, which is common for entrepreneurs. We see shiny objects everywhere. How do they get focused and how they start, how did they start listening to that inner voice that connects them with the divine so they can start making the right moves? [00:45:00] Ryan: Well, I think it's very simple, right? You just make God the focus. You just have to trust that if you make him the focus. Everything else will fall into place. And then it goes back to Matthew 6, 33, seek first the kingdom and his righteousness and everything else will be added to you. And that's faith. [00:45:18] That's faith in a nutshell, because you'll be like, well, don't understand the fires that I have, Ryan. You don't understand the drama and the problems. My kids are doing this, my relationship with my wife sucks. Like I got to focus over there in order to fix. You know, well, before I can go worry about God. [00:45:35] I mean, that's like the biggest thing I hear all the time too. It's like, well, I. Once I get my life right, then I'll start going to church. I'm like, no, you can't get your life right. That's why Jesus paid the price, because you can't. It's the same funny thing I hear when people are like-  [00:45:49] Jason: it's like saying once I get abs, I'll stop eating candy bars. [00:45:53] Ryan: Yeah, well, I was going to use a health example too where I hear this actually from people because I was in sports for so long Hey, I'm going to get in shape first, then I'm going to go get a trainer and start you know, because I'm not ready to go train with them like, that's too hard. I got to like get in shape first and I'm like, dude. [00:46:09] No, that's why you need a trainer like no, And yeah, it's the same thing with faith. It's like if you follow god and you seek his ways I mean just like you've been saying from a practical standpoint. If you follow what the Bible says, your relationship with your wife will get better. Like, you're just going to be a better leader, you're going to serve her, you're going to be different. [00:46:27] Your relationship with your kids will get better. The relationship with your employees will get better. The way you act in business will be better. You know? And it doesn't mean that it's going to be easy. I didn't say it was going to be easy. I just said, it's going to get better. And you know, I've had, yeah. And I had, I've had so many difficult situations in business, you know, lost millions, investors pissed, customers pissed, lawsuits. [00:46:53] I've dealt with everything you could imagine in business. And guess what? Every time I've been able to get through it and it's because of my faith and I didn't know how I would get through it. I didn't know what the outcome would be. I didn't know how I would solve it. But I can tell you I slept pretty good throughout all of it because I just knew God would take care of it some way somehow. [00:47:16] Jason: You knew it would be figured out and you felt like you had somebody on your side that's pretty powerful.  [00:47:21] Ryan: I mean, God promises to be on my side.  [00:47:23] Jason: Yeah.  [00:47:24] Ryan: You know, Romans 8, 28 says that, you know, he works all things for my good, for those who believe.  [00:47:30] Jason: Even the tough stuff.  [00:47:32] Ryan: All things, not some things.  [00:47:34] Jason: Whom God loves, he chastens. Despise not the chastening of the Lord, right? So may not necessarily be easy, but yeah, it'll be worth it.  [00:47:41] Ryan: Don't expect anything to be easy.  [00:47:43] Jason: Right. I think we go into it, we should expect things to be hard and worth it. And I think when we're, it's kind of like the old stoic adage, you know, hard choices, easy life. [00:47:53] Easy choices, hard life. We all know people that they're focused on ease. They're focused on trying to have comfort They're focused on how do I how do I avoid doing stuff? I just want to relax. I just want my weekend I just want time and I think as i've grown into adulthood and you know focus more on stepping more into my masculinity. [00:48:13] I've realized that you know, nobody's coming to save us, except maybe Jesus, right? Nobody's coming to do it for us. There's a level of work that's expected and we need to get beyond always seeking comfort because comfort is a deceptive and alluring sort of drug and we need to be willing to put in the work put in the effort and focus and put in that discipline and then life gets a lot easier overall Like life gets a lot better overall when we're disciplined. Disciplined people don't cheat on their spouses. [00:48:47] Disciplined people like, you know, take care of their kids and spend time with them on the weekend. Disciplined people you know, focus and take care of their health so they have less health issues. They're putting their own oxygen mask on first, so to speak, so they can take care of others, right? [00:49:02] And that's it. That's discipline. And I think that's important. Well, Ryan we're about out of time. I really appreciate you coming on the show. This has been I think inspiring conversation. It's got my brain sort of running in a bunch of different directions thinking about, you know, how can I be better and how can I evolve as a human? [00:49:19] What would you like to say in your final words to those listening to this podcast and maybe how they can get in touch with you or your various businesses.  [00:49:30] Ryan: Yeah, I think you know, as far as getting in touch with me, that's easy. You can just go on social media, search Ryan Pineda, wherever. [00:49:37] So that part's easy. I would say the final thing to leave him with, I mean, we've talked a lot about faith and eternity and everything else. And that's usually the final thing I leave on podcasts because I don't depending on where the conversation goes, right? You know, I'll always draw it back to faith. [00:49:51] So I would just say that, man, I mean, like, look there's a common theme for what we're saying. It's like, life's going to be hard one way or the other, you know, you're going to go through tough times. You are going to have uncertainty. You're not going to know if things are going to work out or not the way that you're hoping. [00:50:08] You know, One thing I know for sure is, and this will apply for both ways, not just faith, but also business and faith. When you start becoming process driven more than results driven, your life changes. Because you're never going to be up and down with the result. You're always just trusting the process. [00:50:28] And so, you know, baseball, we had to learn this every day. It's like, I don't know who's pitching tomorrow. I don't know. Like, I just got to trust my routine, my process, and then I'm doing the right things every day. And if I follow that, I know I'm going to get the best result that I possibly can get. In the long run, and I think you were referencing that when it comes to, Hey, you know what? [00:50:46] Even if you don't believe these biblical principles are going to change your life, that's a form of trusting the process. And if you do, you know, you'll end up getting better results just overall, whether you believe or not, and you just follow that process. And then, you know, I would say even to take it a step further, it's like, man, if you trust that he is the creator of this world and he has promised to take care of you then that's a process to choose to have faith and trust that's the case, to trust that his plan is better than your plan. And it's not easy because we all want control. We all want certainty. That's, you know, that's our human nature. [00:51:21] That's why we're trying to get financially free. That's why we're trying to you know, get enough cash flow and I teach on these things like I get it. But there's a better plan. And you know, if you just trust the process every day of following him, he will make your path straight, you know? And so I've seen that in my own life. [00:51:42] I'll tell you this. I never thought I'd be a podcaster, an events guy, a social media guy. I never thought that was going to be the thing, but. I felt like God was calling me down that path, and here we are. And I don't know where he's going to call me the next 10 years. I don't have a 10 year plan. I don't have any of that, and I don't care. [00:51:59] All I'm trying to do is whatever God's calling me to do at this moment, and I want to be flexible to his will, and be very careful not to just insert my will. And that's it, right?  [00:52:10] Jason: Yeah, appreciate it. You know, appreciate you coming on the show. I think, I agree. I think you know, even if you, For some reason don't want to be christian you don't you don't you're opposed for some reason. [00:52:23] Some people are just like opposed to the bible, just look at the bible through the lens of what are the principles that have made this book one of the greatest books of all time? Why has it stood out? Why has it stood the test of time? Why do so many people look to it for wisdom and for insight? There's so much wisdom in there and if you can at least just be willing to extract wisdom wherever you can find it, then you're not an idiot And so at least start there, everybody listening, just look for wisdom, be a seeker of wisdom and look for the things that are better and higher. [00:52:53] And that's going to eventually lead you to better and higher things and help you to weather the storm. And you can tell Ryan has, you know, he has this confidence that comes from knowing it's not all reliant on him. He trusts that there's something greater than him that's going to give him a source of power or ideas or decision making or guide his paths and to not have that for those of you listening must be terrifying. It must feel a little bit scary to just not have nothing else above you to reach up to. And so there is a god. There's somebody reach up to, go ahead and test it out. [00:53:29] My way of aligning towards God is to sit, read things that I feel like lead me closer to something better and higher. That could be scripture, whatever, or to meditate on something, but then to think, how can I align my will with that? What is that voice inside? What is that calling telling me to do and take those actions and do it. [00:53:47] If you don't take those actions, listen to it, that voice will get quieter. But if you start to listen to that voice and take those actions, it's going to get more and more clear to the point where you have that confidence to go out and make decisions. So I think that's a good ending note here. [00:54:01] So Ryan this is a very different podcast episode than we've ever done here on the DoorGrow show. So there we go. I like it. The most impactful one though. I appreciate you inspiring us to get into faith and chat about that. All right. And And that'll be it for today's show until next time everybody to our mutual growth If you are struggling within your property management business to figure out how to figure out what you need to do next in your business operationally or how to add doors, reach out to us. We'd love to support you. Check us out at doorgrow. com and that's it. Bye everyone. [00:54:33] you just listened to the #DoorGrowShow. We are building a community of the savviest property management entrepreneurs on the planet in the DoorGrowClub. Join your fellow DoorGrow Hackers at doorgrowclub.com. Listen, everyone is doing the same stuff. SEO, PPC, pay-per-lead content, social direct mail, and they still struggle to grow!  [00:54:59] At DoorGrow, we solve your biggest challenge: getting deals and growing your business. Find out more at doorgrow.com. Find any show notes or links from today's episode on our blog doorgrow.com, and to get notified of future events and news subscribe to our newsletter at doorgrow.com/subscribe. Until next time, take what you learn and start DoorGrow Hacking your business and your life.

Ever wonder what it takes to turn your Walmart product listings from lackluster to lucrative? Ryan King, the savvy CEO of BlueRyse, joins us on the airwaves to share his expert strategies for maximizing your presence on Walmart's digital shelves. Together, we navigate the intricacies of PPC, the subtleties of listing optimization, and the crucial metrics that could make or break your profits. Ryan's advice, drawn from the cutting-edge tools of Helium 10, affords a masterclass in finessing your financials and leveraging Walmart's ever-growing online platform for unparalleled brand growth and diversification. In the vast sea of selling at Walmart, standing out is an art form, and we've got the brushes and palette to help you paint a masterpiece with your product listings. Our journey reveals how to ensure your offerings are not just indexed, but also scoring high on Walmart's listing quality score. We cover all bases from the precision of backend attributes to the finesse required in product type optimization. We also dissect the importance of competitive pricing and swift delivery, how to ace the A/B testing game, and even how Walmart's fulfillment services can provide a much-needed boost in ranking. As the curtain falls on this episode, we've left no stone unturned in the realm of Walmart PPC and the emerging tactics of brand conquesting. Imagine targeting competitor brand terms, a concept newly possible on Walmart, and the advantage it hands you in the grand chessboard of ecommerce. Wrapping up with a flourish, we dabble in the complexities of SEM strategies and the nuances of bidding wars, closing with a heartfelt word of thanks to Ryan for his insights. So, tune in and equip yourself with the secrets to selling success on one of the world's most formidable marketplaces. In episode 546 of the Serious Sellers Podcast, Carrie and Ryan discuss: 00:00 - Walmart Listing Optimization for Increased Sales 01:47 - Expert Insights on Walmart Brand Performance 04:54 - Leveraging Social Proof in E-Commerce 08:58 - Optimizing Search Terms on E-Commerce Platforms 12:48 - Maximizing eCommerce Channel Expansion 18:07 - PPC Strategies & Updates for Walmart 24:19 - Untapped Brand Defense Opportunities 29:42 - Expanding Opportunities in Walmart Marketplace 32:36 - Optimizing Walmart PPC Bidding Strategies 36:26 - Tips for Completing Applications Successfully 40:00 - Secret Strategies Ryan Uses ► Instagram: instagram.com/serioussellerspodcast ► Free Amazon Seller Chrome Extension: https://h10.me/extension ► Sign Up For Helium 10: https://h10.me/signup  (Use SSP10 To Save 10% For Life) ► Learn How To Sell on Amazon: https://h10.me/ft ► Watch The Podcasts On Youtube: youtube.com/@Helium10/videos Transcript Carrie Miller: Walmart PPC and Listing Optimization Strategies to increase sales on the Walmart marketplace. This and so much more on today's episode. Bradley Sutton: How cool is that? Pretty cool, I think. What was your gross sales yesterday, last week, last year? More importantly, what are your profits after all your cost of selling on Amazon? Did you pay any storage charges to Amazon? How much did you spend on PPC? Find out these key metrics and more by using the Helium 10 tool Profits For more information, go to H10.me/profits. Carrie Miller: Hello everyone and welcome to another episode of the Serious Sellers Podcast brought to you by Helium 10. My name is Carrie and I will be your host, and this is our Winning with Walmart Wednesday, where we go over all things Walmart, we tell you the latest and greatest news about Walmart, we answer your questions and we have an amazing Walmart expert guest. I'm going to just tell you a little bit about some Helium 10 tools, because I haven't really mentioned these a lot lately. I wanted to make sure that everyone is aware that Helium 10 does have a lot of amazing tools that support Walmart. So we have X-Ray. It's going to help you with sales estimates and so much more. We have our Cerebro and Magnet tools that help you find amazing keywords for your listings. We also have our Profits tool and our Keyword Tracking tool. In addition to that, we have Adtomic, which is our paper click advertising management software, so that is extremely helpful. We've added day parting and a lot of other amazing things to Adtomic, so it's definitely the best it's ever been and highly recommend checking that out if you haven't checked it out. All right. So today I want to bring on our guest, and I'm really, really excited to have him on today and his name is Ryan King, and so thanks so much for being on. Ryan is a CEO and co-founder of BlueRyse, which is a Walmart agency, and I've actually known Ryan for a few years now. We met at the Billion Dollar Seller Summit and we definitely connected on Walmart stuff, so he's definitely an expert in the field and I'm really excited for him to share all of his knowledge with everyone today. I know he was on last year, but for anyone, Ryan, that doesn't know you, can you go ahead and tell a little bit about yourself to the audience? Ryan: Certainly. Yeah, thanks for having me on here, Carrie. Glad to be on this episode here of the Serious Sellers Podcast, specifically talking about Walmart. So yeah, BlueRyse is a full managed service agency focused specifically on Walmart. We've been operating with third party and first party brands since early 2020. And our focus is on everything from content optimization, ad management, catalog management, interfacing with Walmart personnel, all these other elements with regard to, ultimately, the focus of maximizing Walmart brand's performance on Walmart.com. Carrie Miller: I want to first start out and just ask you, because you've been in this Walmart game for quite some time, what do you think the main advantages are for third party sellers to start selling on Walmart and do you think it's a really good opportunity? Ryan: Yeah, absolutely. It's a great opportunity. I think the advantages have continued to grow over the years. They haven't diminished. One of the reasons we saw the opportunity on Walmart was as brand owners ourselves. We began and launched and grew brands on Amazon back in the day, starting in early 2013. And we were looking for ways to, as brand owners, de-risk a bit, diversify revenues back during the aggregator boom. Part of the factor was how do we increase multiples, all those kind of elements? I think all the principles remain the same as to why those would be advantages. If you're truly building a brand, then you're looking to identify what are the channels that make sense to increase sales, increase profits overall and to de-risk. So that's one advantage of finding other marketplaces, other channels to sell through. Beyond that, there's just the fact that Walmart is pushing heavy and has been pushing heavy into the online marketplace space. They understand that for them as a business, as a retailer, while they're the number one retailer in the world, e-commerce certainly has been a major growth factor for others competitors like Amazon and everybody else, and so Walmart understands that they need to compete in the digital shelf. That means they want more sellers, they want a broader assortment, they want great products so that more shoppers come and have a great experience. So that has led to Walmart heavily focusing on building out their third-party marketplace over the last several years. I would say a couple other that come to mind social proof and reviews and ratings have been always on the forefront of e-commerce sellers' minds, especially in the Amazon space, such large motes. I haven't looked at this example in a while, but earbuds, Bluetooth earbuds. When I looked at it, probably two years ago, the average review count for Bluetooth earbuds on page one for Amazon was somewhere around 40,000. At the time, the average review count for that keyword, which was a high volume keyword, on Walmart was around 800. And so just the opportunity to enter the market. You know, if you had wished you had. You know the buzz for a long time was Walmart is Amazon of 2012 or whatever it may be. Walmart is in its own right of maturing marketplace these days, but the opportunity still exists. In that way, I think, the other ones. There is a bit of a different shopper base, and so if you have a broader assortment, your heroes on Amazon or other marketplaces may also translate to be your heroes on Walmart and you can just get a continued growth of that assortment. However, we also do see because it is a different shopper, a different marketplace, sometimes some other products that may not be performing as well in your catalog on Amazon might be your top performers on Walmart for various reasons, and so it breeds new life into your catalog, potentially. And then, finally, if you really want to identify ways of growing the brand, and maybe brick and mortar retail is a desire of yours at some point, then there is a credible pathway to getting products into brick and mortar. We work with brands all the time. Who that is part of their play, whether they've begun with conversations with merchants first, and it's a let's test and see and let's get it in, or if they're native e-commerce or D to C first, and they're, they're engaging with us in order to optimize and maximize performance planning on that conversation in the future. We see those dots connect quite consistently to at least get a conversation. So all the above and then, for those who have FOMO you know, to kind of trigger the FOMO, that it's, it's a bit of this is the opportunity to get in now, even if it's maybe a mid to longer term play for some brands. Get in now while you, while the opportunity is there, while there's more access to account managers and others who are aligned incentives with you, to get your assortment online on their marketplace. Carrie Miller: Yeah, amazing, yeah, those are all really amazing reasons. The next question I have for you is you know, people are always wanting to know how can I, you know, increase my sales on Walmart. So what are some strategies you have for listing, optimization and just increasing sales on Walmart? Ryan: Yeah, you know, I know a lot of these have probably been covered repeated ways, but it bears repeating again would be step number 1 is making sure you're not just If you're gonna, if it is a secondary or tertiary marketplace in your mindset and strategy and you're not paying attention to the unique ways you need to optimize for Walmart, then unless you're kind of the you hit the trend at the right time in the in the search volume at the right time, Walmart with an optimized listing, you're not gonna see great sales lift. And so Step one would be, know the Walmart marketplace. Understand how the algorithm works, understand what product listing optimization means, understand that it needs to be original for Walmart's marketplace and how that impacts sales. And so if I was looking and we can talk about I know we've talked about this several times in the past to some key things to look at, let's just jump forward and assume you're on the marketplace, you're trying to grow sales in your troubleshooting, first step I go to is on the listing itself. Or actually the first step would be double check search term volumes, and this is easy. Segue into talking more about Helium 10 tools, because that's what we use is look at your category. One simple way to do it you can either start with your own listing or you start with competitive listings. But one way we like to do it is as well as you go to Walmart.com, go to the category and sort by bestseller, you'll probably get a lot of 1P brands, meaning in store brands, those they're popping up at the top list. But go ahead and pull up X-ray if you have Helium 10 X-ray and scrape the Top 10 out of there and then plug those in, analyze them through Cerebral and get that, that search term volume list, and identify where are the search volumes? Are you optimized for those? One thing to call out if you're in a consumable space or anything that might be more related to grocery, for example, Amazon search volumes, you might have found success with different types of search terms. But there might be high volume search terms on Walmart you haven't even optimized for Because Amazon wasn't a grocery first type marketplace or that type of place. So there's, there can be high volume keywords that would not even exist really On the Amazon marketplace that are going to be high drivers on Walmart. So identify, get, make sure you're looking at the right search terms. Secondly is just make sure you're indexing and ranking before you even think about ranking. Are you indexing? And one of the fundamental areas that you've got to look at to make sure you're indexing properly is your category. Are you on the right shelf path? But if you go into growth opportunities and you click on your listing in your kind of table of products that show up there product type widget will show up and look at that product type and I didn't try and identify. Is this the right? Does this fit? Product type determines what the back end attributes are on your listing that you need to fill out and, just as a quick aside, you need to fill those out as exhaustively as possible. It's only getting more and more important to do so. While your listing quality score is not as heavily Impacted by attributes as it used to be, your visibility and relevance are, and they only increase increasingly. Be so. So fill those all out. If, even if it's a not applicable, you know, even if it's saying sports team and you're a toothpaste brand, you know, make sure you just say none are not applicable, whatever is there, and then test the product type. We've talked about this in the past and we can talk about it again if you like. But testing that makes sure your listings are optimized. So the algorithm on Walmart's giving you quantitative feedback Between your content, which is your back end attributes, your title, images of long and short descriptions, and are you at? You get mostly ranking benefits around 80%. But if your long term play is really to be best in class and to open up other doors with potential features and other things, 95% or higher is your goal offer. So price parity with other marketplaces is key, and speed of delivery. So, whether it's using something like a deliver, we heavily recommend just using Walmart fulfillment services. They continue to get broader distribution. You're instantly credited in the score with utilizing theirs and getting 2 day delivery. So use the levers that Walmart's given you on the marketplace, and we can talk further about other ways. If someone's listening saying I've done all that, I'm at 95%. I don't know what else to optimize. We're using WFS. There are other things to continue to do. We could talk about whether that's how do you look at imagery in a way to convert? How do you utilize advertising? How do you drive external traffic to listings? What's its impact? We go a variety of ways. Maybe the last thing I'll say, though, is the first question. The last thing I'll say is maybe the first question you should ask yourself is what's your overall business case? So sometimes we have sellers come to us and they're saying I don't want to do anything, Amazon's my main channel. I would like to sell in Walmart. What can I do? And there's going to be certain limitations. If you're saying I don't, price is going to be determined by my other marketplace, not by Walmart, or something like that, you've got to be aware of those and what you're long, how the impacts, the levers you can pull on Wal-Mart. Now there's some interesting features coming out, like couponing and different things that can maybe allow for greater flexibility there. Carrie Miller: Can you talk a little bit about how to product AB test your product type, because I know you mentioned that In there. Just how to optimize, because I know you know certain product types reach more keywords. So how do you just keep track of the keywords that you? Maybe you Get impressions for an ad or like how do you really determine which one has better keyword reach? Ryan: You can do. There's various methods. It's whether you're doing advertising. You're just saying we're not. We're not getting on to your goal when you're running advertising for any keyword. Really, if you're using search and grid, which is a sponsored product, that's what most people are thinking about when they're leveraging advertising on Walmart, you're competing for Page 1. It makes sense that from a conversion standpoint, most people aren't going to Page 2, Page 3, but literally you're competing for Page 1 because the Top 4 positions are awarded potentially for the keywords in the categories for sponsored product and the next 2 out of every 10. But you've got, on average, around 40 products on Page 1 of the listing of the search results. Those same positions are being repeated across every page. There is no, I didn't get position 1 Page 1. Maybe I'll get position 1, Page 2. Position 1, Page 1 is repeated across every page. You've got to compete for those top positions. In order to do that, keyword relevancy matters. You'll get the signals If I'm showing up and position 200 from my ad reports or whatever. Or if you're using Helium 10 again and Keyword Ranking Tracking and maybe turn on boost for those keywords where it may be and track on a real-time basis best you can, how you're performing on those keywords. Obviously, make sure it's in your title. Title has the highest ranking, has historically had the highest ranking influence on keywords. You can only get about 1 or 2 in there because you don't want keyword stuff. Then in your description both points, all those things as well. Make sure it's in your listing. If it's in description and key features, repeated just a couple of times, make sure it's readable and flows naturally. Once you've made sure it's in there, then track, get your baseline. It's not truly an experiment if you didn't really record ahead of time. Am I running an experiment? Otherwise, we use the word experiment like when we just tried something and failed but we don't know what we learned. Get your baseline, see what your rankings were. Before you try something, use Helium 10's Keyword Tracker. Then go into growth opportunities, go into pick that listing, get to that middle widget that says product type. Make sure you record which one you are right now. I've used this example in the past with you, Carrie, I believe. But one case study we did was involving a client who was in herbal supplements. Their product type it was an herbal supplement and their product type was actually an herbal supplement. The product type was a one-to-one exact match. You would assume this is the best product type to be in, but we weren't indexing for them, no matter what we did for probably 10 to 15 major keywords that we knew they should get. We went to that widget. You pick. I think it's a reporting issue. It doesn't say switch product type or anything. You have to click the link that says reporting issue. It'll give you usually 4 to 5 choices of other product type. You think it is. Basically what it's doing is creating a support ticket for you and you can submit that request of change. It's not a guarantee that it'll happen, but persistence pays off. We recommend making requests of that change once you've been informed that changes happen. Then watch for us. What we saw was in that product, all the keywords we needed were instantly indexing for and began ranking within the first couple of pages of results. That was the beginning of the journey. That's a general standard practice for us in making sure we're in the right product type as well. Carrie Miller: All right, that's really good. Yeah, that's a really good strategy. I've used your example many times because people ask me about that a lot. Usually, when they get in the right product type, they start to see a lot more traction. Thanks for sharing that. I want to get into advertising because we haven't talked a lot about PPC on Walmart, on our podcast here for Walmart. I think a lot of people have questions about it. I wanted to just get your. I know you have some basic strategies or just thoughts about PPC and then also some new things that are coming that you think people should take advantage of. Then, once we're done with that, we'll get into some questions from the audience. Ryan: By way of really brief recap for those that have been around the Walmart space, I've heard of it over the past couple of years. A lot of people were shy about getting into Walmart PPC in the earlier days because it used to be a first bid auction, which meant fundamentally different than how you would be used to utilizing Amazon. Whatever you bid is what you paid. People were just blowing through their entire budget because they were trying to figure out if they could get a keyword to rank and they thought if I just spend more, I'll get placement. In those cases they were bidding $4 a click and they were winning position 40. They were getting the click and they were spending $4 for a click on position 40. The good news is shift to second bid auction. That's been around for quite a bit now. Really, what you're talking about when we're talking about PPC is fundamentally you've got a sponsored product, which is broken down into two types of campaigns: auto and manual. You've got search and grid placement. You've got item carousels that you can get in search results. You can get item carousels on product detail pages as well as next to the buy box placement. You've got on the manual campaigns, you've got exact match, phrase match and broad match, then auto campaign is what it sounds like. You're letting the algorithm do its thing. You've got some placement modifiers. You can do modifiers for app, desktop and mobile. In some other ways you can tweak things. The big thing to know still with Walmart PPC is it's heavily influenced by algorithms. Determination of are you relevant for those keywords, and so that has a. I mean that's common practice and most ad retail media platforms. But it's a heavy influencer on Walmart. So you do need to approach it from an organic signal, cell signals as well as PPC. When you're trying to rank through PPC you just can't spend your way to the top. You need to be in striking distance. The top 256 organic ranking results qualify for placement and searching grid, but you're ultimately trying to outperform whoever's in position at least 40, or at least position 30. And so it's usually a hand and glove kind of operation of how you're going to drive signals to the platform for purchase intent, showing that relevancy, and then continue increase your PPC so that you're stair stepping your way up to, ideally, somewhere in those first four positions or somewhere on that page 1. Carrie Miller: How do you get to those 200 and it's 256?, like if you're at spot 300, how do you get down to that spot? Ryan: Yeah, it depends. It's really specific on the categories. You know, the one other element when we're talking about keywords and search volumes on Walmart is there's not as many long tail keywords. The keywords just don't go as long. So you're probably going to see a significant drop off on volumes after some of the major keywords in a lot of categories. Maybe long tails, around two to three keywords long, are going to start dropping off significantly. As kind of a frame of reference, we would say, if you can find keywords up over, if you're finding 10 keywords in your category that are relevant to you, up over 7000 in search volume, that's pretty good. There's. There are ones way bigger, but identifying those to go for to get in the top 256, you may pretty quickly already appear there. I would say pick your, maybe not the biggest keyword to put in your title right away, but maybe that second tier keyword to put it in your title and some other places, and then plan on changing it over time as you grow. But some ways to drive traffic you know whether a lot of sellers already have, whether it's influencer traffic, whether it's Google ads traffic, whatever else, if you already have a traffic funnel that's leaning to DTC or anywhere else. Consider splitting a little bit of that traffic over for a period of time to Walmart at least, and you'll be rewarded. A lot of the signals of external traffic are rewarded heavily on Walmart behaviors like certainly purchase, but even behaviors like we've, you know, add to cart purchase. Any of those elements are signals that register with the algorithm and help sending signals of relevancy to get you in that top 256. The biggest one being someone searches, finds your products and purchases. So anything you can do to do that is a big help to get that going. Carrie Miller: All right, that's very interesting. And then also, you've mentioned conquesting as something everyone should be doing. Could you just explain what that is on Walmart and you know how people can start utilizing this? Ryan: Historically you could not do brand cron questing on Walmart. You can't. You obviously can't put trademark terms in your listings. That's just a copyright issue but an advertising. Until just very recently you haven't even been able to brand conquest. Really, there's kind of some ways around that. But now you can kind of the headline. So what we'd recommend is for those brands that are starting to show some relevancy or do things and you know there are heavily branded search terms on Walmart. We've noticed Walmart is leans typically more in a lot of categories towards branded search terms with high volume. So this has been untapped opportunity for a lot of brands. Unless you're running an auto campaign to get you, you get buy box placement, you know, just under their buy box on their PDP. So now you can actually set up a manual search, a manual campaign, and you have to have, you have to use exact match keywords and you can use. Just put in every variation of that brand name in there and you can win. You can't win position 1 or 2 with that brand, but you can get beyond position 2. In most cases you're eligible to actually show up in grid for their terms and so that's one that most brands that have not been playing defense as much may still be asleep on right now. So it's a good opportunity, at least for now, until some of those brands start allocating defensive budget in that way, those brands will be again because of relevancy and how it impacts how much you have to pay to win versus someone else that's more relevant. Brands are going to effectively get a discount for defending themselves because they're the most relevant one, so they're going to have to pay less than you to defend. But if they're not really bidding on it at all, this is a great opportunity. Carrie Miller: I think that's really exciting because I haven't actually done that strategy at all yet. So I'm going to definitely get on that today and see what I can find, because I have found so many branded search terms that I think would be really great to target in the past, but I wasn't able to. So that's really good, okay, so let's go ahead and get into questions from the audience. So I'm going to start with this question here. It says I have two questions. So what type of keywords are better for sponsored and manual campaigns? And I guess that's one. Ryan: I would kind of say what I said earlier probably is it depends on what stage of the lifecycle you're in at Walmart. So if you're trying to build relevancy and it's a new product without much sales history yet, I would probably recommend starting with exact and maybe phrase in a manual campaign of those kind of second tier keywords. Go after the long, the longer tail, build the relevancy there. Every conversion is going to help with relevancy of other keywords in your listings. So begin and stair step up. Another great strategy is at the same time you might want to often will will wait a little bit to do auto campaigns or maybe do it also at the at the same time that we're starting some manuals, but with a low spin threshold, so it doesn't go crazy and pick unirrelevant keywords, irrelevant keywords, but using ultimately gold. Also be using automatic keyword campaigns or automatic campaigns to harvest the performing keywords into your manual and put those into exact match. And then the last tip I would give is using the bid modifiers in manual campaigns to really kind of take over. If you have auto campaigns as well, manual campaigns are going to perform really well in search grid and so you want your manual campaigns really doing the work for those high, high volume keywords in your grid versus maybe your auto. So that'd be a few of the tips I'd give you. Carrie Miller: Let's go to the next one. It says I heard you say that more 1P sellers for more might be moving to 3P. Is that good or bad for other sellers? Ryan: I certainly thought I didn't. I don't recall saying it, but I made up. Yeah, so the Walmart basically is leveraging the third party marketplace for a lot of reasons. One of those is historically with 1P Brands, meaning brands that Walmart has entered into a contract relationship with, where they're owning inventory and setting the retail price, those things. One of the ways that Walmart wanted to test out more of the assortment with a brand, develop a meaningful relationship, would be they would select a small subset of the products, get them in-store and distribute or online and Walmart would manage everything. Then they used to tell brands that they would do. Another program called DSV. I won't go into all of it, but it was still in an owned relationship. What we've seen is a shift more towards merchants, buyers, telling brands to put the remainder of their catalog on the third party marketplace now that it's become more mature. Is it good or bad for sellers? On one hand, good in that as you have more recognizable established brands continue to increase their assortment on the marketplace. That's bringing more shoppers, more eyeballs to the marketplace. That's good for everybody. Bad, meaning more competitive. Advertising on keywords, certainly retail media ad spend we've seen increase year over year as Walmart grows the program. That's the natural life cycle of any platform. It will certainly get more competitive. Margin's may decrease over time. If you maybe have had your business model has been dropshipping and just trying to find those places where 1P brands are there's gaps, where 1P brands aren't really owning the marketplace. I still think there's a lot of opportunity there on the third party marketplace, but they're starting to catch wind of it on Walmart as well. There's challenges there bit of both. I think there's plenty of opportunity as Walmart's marketplace continues to grow. I don't think we need to be worried right now about, are you getting squeezed out of any opportunity? This is still early stages on Walmart's marketplace. Carrie Miller: I agree there's still tons of opportunity. The next thing is is there a way to get your products from WFS or Walmart probably into in-store? Do you have to apply or be invited to have your products in Walmart stores? I think this is a good question because it seems like with open call, it's just US products, but is there a way for products that are made in other countries? If you can expand on just that whole process, I think a lot of people are curious about this. Ryan: Yeah, you mentioned open call, which is for US manufacturers. There's been different times where I think two years ago, two to three years ago, they gave FirstBot at the Apple to Walmart marketplace sellers. They got to apply first and got an opportunity. Outside of that opportunity there is if you're growing an account, if you're seeing sales and showing volume, showing growth. Some of the stepping stones would be identifying if you could get an account manager or a strategic account manager to work with on your account, identifying category manager, somebody else to begin discussions with. That starts with usually getting opportunities turned on and growth opportunities, whether that's seasonal promotions, whether that's flash picks, other elements as you continue to invest and show performance there. Walmart's team they are brick and mortar team and they're a marketplace team or basically one team. A lot of buyers and merchants will look across their whole category, even on the third party marketplace, as they're evaluating opportunity. These conversations could happen and you could ask for an introduction. We've had clients that have just a category manager. Somebody else has reached out and said would you be interested in talking with a merchant about potential opportunity for in-store? There's a lot of pathways. I don't think there's a defined Walmart's probably not going to lay out for you. Here's how every marketplace seller can contact a merchant but continue to invest in sales and growth on Walmart marketplace and those conversations certainly can happen. Carrie Miller: Yeah, that's exactly what I always hear from Walmart directly. They say to prove it on the marketplace, basically All right. Next, this is a good question: Any insights on the new SEM feature? Will that feature help ranking or index on keywords used as a GG search, maybe Google search? Ryan: We've had a few that we've worked, we've tested out. Sem. Vertic is still out right now in the early stages. Any kind of early testing. As far as depending on the goal, if the goal was measured by, do we see direct conversion at a higher row, as than you would for sponsored products, which is lower in the ads funnel, more towards conversion anyway than earlier consideration steps in the funnel. It's a lower conversion at this point but there are potential advantages. I'm still waiting to clarify this element. I believe it's true, but again because we haven't worked with a lot of resellers or people that are competing with others for their own buy box. I did hear in a recent webinar and I haven't been able to go back and fact check again by one of the product developers for SEM that one of the impacts of SEM is that you could run SEM even when you're not presently in the buy box and you could drive traffic to your instance to get the sale. For those who are struggling to win buy box, that may be a pathway to getting more sales and conversions by ads aren't going to serve on marketplace when you don't have buy box but if you're running SEM. It sounded like and again I need to. I try and fact check everything before I say it and I heard it said once and I want to make sure I heard it specifically, but that definitely perked me up and I need to go back and verify. I believe what was communicated was you can run SEM through Walmart when you're not in the buy box and direct to your instance of you owning the buy box when traffic gets there. That's one opportunity. Carrie Miller: Let's see. I've only been selling on Amazon since October. I have 9 reviews and 1 seller feedback. Is this enough to apply to sell on Walmart? Ryan: The exact criteria aren't shared publicly as to what is in that decision factor. There's a lot of factors. I'll see you all next video. What ultimate? I think that the safest thing to say is what Walmart's looking for is that you have established yourself as a company that shows that you're making good products, strong history of seller satisfaction, so customer support, and that you're a legitimate company looking to do business. The other factors they're looking for are your products, a meaningful addition to the marketplace? So are you adding products to the marketplace that makes sense to them? That's a really broad filter and subjective maybe. So I can't tell you what that looks like. If you have 9 reviews, maybe on one product and it hasn't been as long I'd probably have a lot more questions as to why you want to jump to Walmart at the moment. Maybe you see the opportunity and that might be the primary marketplace that you want to pivot to. Those are my initial thoughts. It'd be hard to answer further without knowing more context. Carrie, I don't know if you have any things. Carrie Miller: Well, they said something, too, about that. They have one product with multiple variations, and I actually have seen other sellers that have one product with multiple variations get on there as well because it's a new, interesting product or really something that would work well on Walmart. So it is really dependent on that, and I've seen some people get on very easily, having not sold for very long, and then others have a harder time. So it is kind of interesting how it's a little bit subjective on there. Ryan: And what? Carrie Miller: Definitely want to be established. Make sure all of your stuff is matching. That's the biggest thing. Your address needs to match and everything needs to be tight on your application. But yeah, anything else that you want to add. Ryan: Yeah, no, sorry for stepping on you there. Yeah, no, that was basically what I was going to say too. If you get an initial reject, don't assume that is because a human looked at your application and determined you were not a fit. A lot of the rejections can happen because the bot has looked at, maybe your information, has did not match between what you submitted and what maybe is included in your business documentation. To illustrate the point is we talked about 1P brands coming over to a three P marketplace at the request of merchants. We still get  1P brands that get rejected when they've applied on their own to 3P marketplace after they've been through even more rigorous vetting because they're in a 1P relationship already. So the bots may trip on it and it's worth reaching back out to try and appeal if you need. Even if you get the message of there is no appeal, there are usually ways to find out. Carrie Miller: And I'm going to just take one last question. We've had a lot of amazing questions. We're kind of running out of time here, so this one is what bidding strategies have you found most effective for optimizing Walmart PPC campaigns, and why? Ryan: Big question yeah. Carrie Miller: That's all I'd like to just answer. Ryan: We could do a whole another episode on this one Bidding strategy found most effective optimizing PPC campaigns. So depends again what your goal. What do you mean by optimizing? Do you mean optimizing for growth, which is going to be a lower TACos, ACoS, low RoAS, potentially because you're looking to increase market share and it's a longer play? In that case, that sponsored brand, sponsored video. I didn't talk about sponsored video. If you're looking for what's the quick wins with a higher ROAS, things like look in your category, look at the search terms Our other brands are already using sponsored video. There'll be one placement on mobile or on desktop for that search term on any page, and if you're not seeing those, that's low hanging fruit. I would go for a sponsored brand. You've got to be brand registered first, but once you're brand registered, you can create sponsored video ads. So that's one way out. Optimize I would just make sure that to optimize a PPC campaign, I think that the basics of making sure your listing is relevant and make sure your listing is optimized first, and so that'd be one major factor that we see just a lot of brands miss. They think they've got the bid strategy right and that they've got the campaign architecture correct. But if you don't have high relevancy already for those keywords, you're not going to take a lot of ground. So in general I would say you want to, in any given campaign, not oversaturate your ad groups and not oversaturate with keywords in each ad group. So maybe up to five keywords in an ad group and maybe three to five ad groups in a campaign so that you can be tracking where that spend is really going and tweaking from there. But then I'd also say the biggest level ups we've seen is when you combine really the PPC optimization with organic. So blend consider offsite traffic advertising as well in some way to blend and improve the performance of PPC. So PPC will get cheaper for you when your relevancy grows and you'll be able to maintain it more. So that's often an efficient way to optimize a bit more. No otherwise to that. But I'll end there for now. Carrie Miller: Thank you again so much for joining us. I think this has been a really fantastic episode full of a lot of information for everyone. I'm sure everyone that's listening will want to go back and listen to this again. But thanks again for all of your expertise in sharing the secretive strategies and we really appreciate you and we'll probably hope to have you on again another time soon.

Welcome to The Cloud Pod - where the forecast is always cloudy! This week your hosts, Jonathan and Ryan, are talking all about EC2 instances, including changes to AWS Systems Manager and Elastic Disaster Recovery. And speaking of disasters, we're also taking a dive into the ongoing Google DDOS attacks. Plus, we've even thrown a little earthquake warning into the podcast, just for effect.  Titles we almost went with this week: A big thanks to this week's sponsor: Foghorn Consulting provides top-notch cloud and DevOps engineers to the world's most innovative companies. Initiatives stalled because you have trouble hiring?  Foghorn can be burning down your DevOps and Cloud backlogs as soon as next week.

Welcome to episode 224 of The CloudPod Podcast - where the forecast is always cloudy! This week, your hosts Justin, Jonathan, and Ryan discuss some major changes at Terraform, including switching from open source to a BSL License. Additionally, we cover updates to Amazon S3, goodies from Storage Day, and Google Gemini vs. Open AI.  Titles we almost went with this week: None! This week's title was ✨chef's kiss✨ A big thanks to this week's sponsor: Foghorn Consulting provides top-notch cloud and DevOps engineers to the world's most innovative companies. Initiatives stalled because you have trouble hiring?  Foghorn can be burning down your DevOps and Cloud backlogs as soon as next week.

Welcome episode 220 of The Cloud Pod podcast - where the forecast is always cloudy! This week your hosts, Justin, Jonathan, Ryan, and Matthew discuss all things cloud, including virtual machines, an AI partnership between Microsoft and Meta for Llama 2, Lambda functions, Fargate, and lots of security updates including the Outlook breach and WORM protections. This and much more in our newest episode.  Titles we almost went with this week: Too Many Bees died for Honeycode Microsoft announces that AI will only cost you 3 arms and a leg.   The Cloud Pod also detects Recursive Loops in cloud news The cloud pod disables health checks bc who needs them A big thanks to this week's sponsor: Foghorn Consulting, provides top-notch cloud and DevOps engineers to the world's most innovative companies. Initiatives stalled because you have trouble hiring?  Foghorn can be burning down your DevOps and Cloud backlogs as soon as next week.

Welcome to episode 218 of The Cloud Pod podcast - where the forecast is always cloudy! Today your hosts Justin, Ryan, and Matt discuss all things cloud - including migration services, AppFabric, state machines, and security updates, as well as the idea of shifting left versus (or in addition to) shifting down.  Titles we almost went with this week: The Cloud Pod Prefers to be Bought by Anyone but IBM What Does the F(in)O(ps)X say?  The Cloud Pod Leverage appFabric for your SaaS Security A big thanks to this week's sponsor: Foghorn Consulting, provides top-notch cloud and DevOps engineers to the world's most innovative companies. Initiatives stalled because you have trouble hiring?  Foghorn can be burning down your DevOps and Cloud backlogs as soon as next week.

Welcome to the newest episode of The Cloud Pod podcast! Justin, Ryan, Jonathan, Matthew are your hosts this week. Join us as we discuss all things cloud, AI, the upcoming Google AI Conference, AWS Console, and Duet AI for Google cloud.  Titles we almost went with this week:

Welcome to The Nonlinear Library, where we use Text-to-Speech software to convert the best writing from the Rationalist and EA communities into audio. This is: Transcript: Yudkowsky on Bankless follow-up Q&A, published by vonk on February 28, 2023 on LessWrong. This follow-up Q&A took place shortly after the podcast was released. It talks more about the hosts' reactions to the episode, clears some questions about AI takeover pathways & alignment difficulties (like "why can't we just ask AIs to help solve the alignment?"); OpenAI/Silicon Valley & what should these companies be doing instead; Eliezer's take on doomerism; what would a surviving distant future look like. Let me know if you can clear up some of the [??] places (here is the original transcript alongside audio).michaelwong.eth: Good afternoon. Good morning, wherever you are. Got to be one of those, I bet. It's another Monday, minting Monday with Bankless. So I hope that you guys got to listen to the episode this morning about AI. And I have a hard time pronouncing this gentleman's name, but I think it's Eliezer. So I got Lucas on the call. I got Ryan on the call. I got David on the call. What's up everybody? David Hoffman: Yo, yo, how are you feeling? Alright? Ryan Sean Adams: Hey, still live. How you feeling? David? David: [laugs] Pretty good. Pretty good. Just you know, everyday trying to push existential dread to the background. Ryan: Yeah, me too. Especially since last Monday when we recorded this thing. Mike, Lucas, How're you guys doing? 0x_Lucas: Doing pretty good. Also kind of going through my own mini existential crisis right now and just trying to survive. One day at a time. michaelwong.eth: I'm living large. I didn't know that the Mr. Roboto part of that song was so late in the in the song. So thanks, everybody for sticking with me through that. But it's kind of relevant today. A little bit relevant. So we're gonna jump into that in just a moment. Ryan: Guys, let's can we get into logistics first. So what are we doing here today, Lucas and Mike? 0x_Lucas: Yeah, absolutely. So we are on our Monday mint number six of the year. So for those familiar, we mint our flagship Bankless podcast every Monday as a limited edition collectible on sound protocol. So you can go ahead and mint these at collectibles.bankless.com and part of it we like to host these little live Twitter spaces just so everyone has a live [??]. Ryan and David'd love to kind of do a debrief on the episode. And hopefully we have Eliezer joining us and I'd also probably butchered his name, but yeah, hopefully he is able to join us in the next few minutes here, but overall, just wanted to debrief on the episode talk about the men. And yeah, get your guys's thoughts. Ryan: Well, I'm definitely gonna be minting this one. That's for sure. And I hope the AI doesn't kill me for it in the future. This is a pretty unique episode, in my mind, David. This is one that caught me by the most surprise I think of anything we recorded. In that, we had an agenda, and then it took a different direction. It was a very interesting direction to pursue but what I wasn't quite ready for. I went and I spent the weekend actually I listened this episode again. I actually enjoy hearing it more than I think I enjoyed actually recording it, for whatever reason – some of the things sunk in a little bit better – but how did you receive it on the other side of this, David? David: Yeah, so the AI alignment problem was like a rabbit hole that I remember going down in my like, I think like college days. And so this is always like something that I had in the back of my head. And I think that's that's like why you and I have reacted differently to it. And I know you you went down the rabbit hole too. But it's like it was just something that I thought kind of everyone knew about and we just all understood that it was like, futile. It was like a thought experiment that was futile to really like reason about because there is no solu...

Welcome to The Nonlinear Library, where we use Text-to-Speech software to convert the best writing from the Rationalist and EA communities into audio. This is: Full Transcript: Eliezer Yudkowsky on the Bankless podcast, published by remember on February 23, 2023 on LessWrong. This podcast has gotten a lot of traction, so we're posting a full transcript of it, lightly edited with ads removed, for those who prefer reading over audio. Eliezer Yudkowsky: I think that we are hearing the last winds start to blow, the fabric of reality start to fray. This thing alone cannot end the world, but I think that probably some of the vast quantities of money being blindly and helplessly piled into here are going to end up actually accomplishing something. Ryan Sean Adams: Welcome to Bankless, where we explore the frontier of internet money and internet finance. This is how to get started, how to get better, how to front run the opportunity. This is Ryan Sean Adams. I'm here with David Hoffman, and we're here to help you become more bankless. Okay, guys, we wanted to do an episode on AI at Bankless, but I feel like David... David: Got what we asked for. Ryan: We accidentally waded into the deep end of the pool here. And I think before we get into this episode, it probably warrants a few comments. I'm going to say a few things I'd like to hear from you too. But one thing I want to tell the listener is, don't listen to this episode if you're not ready for an existential crisis. Okay? I'm kind of serious about this. I'm leaving this episode shaken. And I don't say that lightly. In fact, David, I think you and I will have some things to discuss in the debrief as far as how this impacted you. But this was an impactful one. It sort of hit me during the recording, and I didn't know fully how to react. I honestly am coming out of this episode wanting to refute some of the claims made in this episode by our guest, Eliezer Yudkowsky, who makes the claim that humanity is on the cusp of developing an AI that's going to destroy us, and that there's really not much we can do to stop it. David: There's no way around it. Ryan: Yeah. I have a lot of respect for this guest. Let me say that. So it's not as if I have some sort of big brain technical disagreement here. In fact, I don't even know enough to fully disagree with anything he's saying. But the conclusion is so dire and so existentially heavy that I'm worried about it impacting you, listener, if we don't give you this warning going in. I also feel like, David, as interviewers, maybe we could have done a better job. I'll say this on behalf of myself. Sometimes I peppered him with a lot of questions in one fell swoop, and he was probably only ready to synthesize one at a time. I also feel like we got caught flat-footed at times. I wasn't expecting his answers to be so frank and so dire, David. It was just a rift of hope. I appreciated very much the honesty, as we always do on Bankless, but I appreciated it almost in the way that a patient might appreciate the honesty of their doctor telling them that their illness is terminal. It's still really heavy news, isn't it? So that is the context going into this episode. I will say one thing. In good news, for our failings as interviewers in this episode, they might be remedied because at the end of this episode, after we finished with Hit the Record Button to Stop Recording, Eliezer said, he'd be willing to provide an additional Q&A episode with the Bankless community. So if you guys have questions, and if there's sufficient interest for Eliezer to answer, tweet us to express that interest. Hit us in Discord. Get those messages over to us and let us know if you have some follow-up questions. He said, if there's enough interest in the crypto community, I'll say he'd be willing to come on and do another episode with follow-up Q&A. Maybe even a Vitalik and Eliezer episode is in store. That's a possibility that we threw to him. We've not talked to Vitalik about t...

Summary On this special episode of COMMERCE NOW, Steve Kremer, Director of Sales in the Payments division at Diebold Nixdorf, and Sarah Grotta, Director of Debit and Alternative Products Advisory Service at Mercator Advisory Group, sat down with PaymentsJournal to discuss the most popular payment method, both in the United States and globally: Debit.  Listen in for a  discussion of why modernizing debit payments is crucial in both the banking and retail sectors. Related Content:  https://www.dieboldnixdorf.com/en-us/banking/insights/blog/get-your-message-out https://www.dieboldnixdorf.com/-/media/diebold/files/banking/insights/qa-faq/mindshare-payments-innovation.pdf Related Links: https://www.paymentsjournal.com/the-time-to-revitalize-debit-rails-is-now/ LinkedIn Profiles - Steve Kremer Sarah Grotta Transcription:  Speaker 1: On this special episode of COMMERCE NOW, DN Steve Creamer, Director of Sales in the Payments Division joins the PaymentsJournal's, Ryan Mac, for a discussion on why modernizing debit payments is crucial in both the banking and retail sectors. Speaker 2: Welcome to the PaymentsJournal Podcast. In here is your host, Ryan Mac Ryan: Welcome to the PaymentsJournal Podcast, I'm your host Ryan Mac. Now, debit is the most popular form of payment in the US and globally and it is influenced by the growing popularity of digital payments and preferences of millennials. Now, it is projected that debit transactions will continue to grow and remain the highest transaction type of consumer payment. Now, modernizing these payment systems will become table stakes. And solutions that have reusable technology that can support multiple channels are key when implemented in phases, especially when starting with one that has the high rewards and low risks, AKA debit. To unpack this further, I'm joined by Steve Creamer, who is the Director of Sales for the Payments Division at Diebold Nixdorf and Sarah Grotta who is the Director of the Debit and Alternative Products Advisory Service at Mercator Advisor Group. So, there's certainly a lot of information to unpack on today's episode. Ryan: So, without any further delays, let's start the show. So, Steve and Sarah, it's an absolute pleasure to have you on today's episode. And I'm really excited to talk about our subject to hear today that's really focusing around debit because of all of the interesting news and statistics that we've started to see come out of just the debit side of the paintings' ecosystem here. Now, to get our conversation started here today, we've got this fantastic chart provided to us by Mercator Advisor Group that's taking a look at MasterCard and Visa Debit and prepaid volumes versus credit and charge card volumes in the United States. So, Steven, if you could, maybe you could kind of unpack this chart for our audience here today and maybe pull out some of the kind of the key highlights or what you find interesting of what this data is representing. Steve: Thanks, Ryan. In seeing this data, I really had to pause for a moment and let this information sink in. It certainly is very interesting that in United States, the dollar amount spent with debit cards increased by 14% in 2020, and also that debit card transactions continued to outpace credit cards two to one, the terms of number of transactions. We may all have our own personal bias on preference between debit and credit and some of us may have a preference for using credit over debit for certain types of transactions, but we need to be careful not to our own views, to administer relevance of the data on the continued strong debit usage. Steve: Did the impact of the pandemic and stimulus money have some impact on increase of debit usage in 2020? I think it did, but I also think that the pandemic also accelerated the consumer migration to digital payment channels and debit is still the most popular form of retail payment, and it's not going away at any time soon. Once you really look at the information that Sarah summarized so well, it really makes a lot of sense, especially when including the influence of younger generations that are growing in importance and how debit is leveraged on a global basis. Close to 83% of younger consumers use a debit card and not credit and that's understandable at their age. Many may have not had the ability to obtain credit, and they also seen or heard so many negative stories about how credit card debt that they formulate a consumer behavior outside of credit usage. Steve: Given the high percentage use of debit now, and with the ever-growing payment e-commerce options, we can really see why debit usage continues to grow. An important note is that the continued popular debit is by no means unique to United States. For instance, in India, I think there are 900 million debit cards versus only 55 million credit cards. And in Europe it varies by country, but debit continues to make a very, very strong showing. From a consumer convenience standpoint, we can see the advantages of using debit over other payment rails. And then finally for the retailer, there are real economic advantages of debit based processing solutions as debit interchange fees are typically much lower than for credit cards. I think at this point, it probably be good to turn over to Sarah and allow her to provide some additional insights into her report. Sarah: Yeah. Thanks so much for that. And really, I liked your overview, particularly the comparison with other countries. Certainly, I think the US is somewhat unique in its history, its legacy of being very credit card-focused that isn't necessarily the case around the world. And certainly, things like the economics play into that. The fact that particularly in the US, we really, really love those credit card rewards. So, it was kind of interesting, I agree, I think this was really pushed by the pandemic when we saw the debit card volumes for the first time tip over in above the credit card numbers. And let me clarify, looking at this chart, that we are looking at debit card purchases. We did make some calculations to extract some of the debit push payments, right? So, that would be MasterCard send or Visa Direct. Sarah: So, we're really looking at something closer to an apples-apples comparison of just debit card purchases from MasterCard and Visa in comparison to what's happening on the credit card side. So, I think as we look forward and as we start to see purchasing habits maybe coming back to something that looked a little bit more like pre-pandemic patterns, so more things like purchases for eating out purchases, for travel in particular, I think that we'll start to see the credit card numbers start to come back up again. But I do think for many of the reasons that you pointed out Steve, I think that we will still continue to see very, very strong debit card growth for the foreseeable future. Ryan: Steven and Sarah, thank you so much for that. Now, to kind of just recap a lot of what was said there, obviously historically, in the US we have seen debit cards outpace credit in terms of transaction volumes. But also, then as we were kind of pointing out, in 2020, we did see that percentage gap changed dramatically with debit card volume seeing that 14% growth over 2019 numbers. Now, Steven, as you pointed out, I think that there's a fair amount of that double digit growth was related and due to the pandemic. And as Sarah kind of stated there at the end that she foresees this growth in debit being a continuing trend. But beyond the pandemic, are there other reasons that you could kind of sight or maybe glean to, of why it is that debit may remain a preferred payment method of choice for consumers? Steve: Yeah. Ryan, I think that's a great question. And in that, I think it's always important to keep the customer experience in the forefront. And the thing about debit is that it's a 24/7 always-on experience. Consumers expect to seamlessly get cash out of, if they're using an ATM or if they're making a purchase, they expect it to be approved right away. And that's true if it's in-person or if it's a debit being used online. As noted in Sarah's report, 40% of debit transactions, I think in US were made in a card-not-present mode. So, consumers want to make sure their cards and data are safe and that they can quickly pay for what they want. But what we're hearing from our customers, both banks and retailers, but primarily the banks, are that the debit networks are being challenged with new payment types and they're spending a lot of time and money on the overall upkeep and maintenance of their debit networks. Steve: As you know, the debit system has been around since the early 1970s and many of the systems that are used to process these cards have really not changed since, or if they have, it's been for band aid updates for their old technology. Legacy debit payment platforms were designed to quickly and securely approve and process of payment or withdrawal, which has always been authenticated with a card. The future payments is not so straightforward. The method of authentication may be different based on the channel, for example, tokens, biometrics, things like that. And the funding could combine payment methods including 'buy now pay later', or other variations. Modernizing this payment infrastructure, and not necessarily just the debit side, is really the key for banks to remain relevant. Steve: Diebold Nixdorf has been a global leader in the processing of debit-based solutions for the last 40 years. And now we're leveraging this experience with our Vynamics payment solution. Vynamics payments is a modern system that it's built using cloud-native technology and microservices architecture that allows banks and processors to not only improve their debit channel, but quickly and efficiently handle other newer payment types and innovations like request to pay and buy now pay later. Which is where we see things moving, will help kind of perpetuate the predominance of debit going forward. Just time out. I'll turn it back over to Sarah for her insights on that same question. Sarah: Yeah. I think that the whole idea of core and payment modernization is really very interesting. And sort of tying that back to debit, it is kind of interesting even though to your point, debit has been around for a really long time. There are still things that we can do as an industry to improve that user-experience, that kind of dovetails into the ideas and concepts around modernizing the infrastructure. So, I talk to issuers about things like making sure that they can digitally issue debit cards as an example, so that they could really make that seamless transition for immediate account acquisition or provide a really great experience should a debit card ever get lost or stolen, or for whatever reason needs to be replaced. So, I think that's a very interesting part of the payment ecosystem right now, is sort of the intersection of things like debit cards and more modern infrastructure. Ryan: Yeah. So, I think that it's really interesting. And one of the keywords that I kind of hear a lot is that the modernization side of things here, and obviously as we continue to look as Sarah pointed out to kind of add enhancements to kind of really improve that consumer experience here. And then Steven, at the end of your commentary, you had broadened up a little bit about your organization, Diebold Nixdorf here, and how it's kind of going through a little bit of modernization here and what it's doing to help their consumers. So, I want to dive into that a little bit more because I think it's certainly fine to talk about it at a high level, but I really kind of want to get into some specifics. And with your insight into the industry, maybe you can give us a few more examples of what you're seeing that your customers are doing to revitalize kind of their debit rails, so to speak. Steve: Yeah, that's a great point, Ryan. Thank you for asking. Really when, when Diebold Nixdorf set out to develop our next generation payments platform, we try to approach payments with a fresh perspective. We ask where would it make the biggest impact and provide the greatest opportunities for our clients? And as you ask, as an example, we recently began a multi-year, multi-phase implementation with a top 10 US bank. This bank is using Vynamic payments to deliver substantial TCO benefits to their organization. They are currently using our terminal software as well as our device handling in the Vynamic's platform for approximately 16,000 ATM's. And the bank has also started to deliver on their roadmap to provide switching and cloud processing as the next phase in their migration to Vynamic payments. Steve: And by doing this, they're taking a modular multi-phase approach and we have successfully maximized their greatest opportunity, which in their case started with the debit rails. And now, we have laid a foundation to scale for the future. In the age of technology, limitations on handling the current demand of transactions and the expense for trying to keep it up-to-date has oftentimes made the debit network the best place to start. And at Diebold Nixdorf, our cloud-native microservices architecture has enabled new functionality, such as handling the card-not-present transactions and digital wallet-based transactions. Steve: We also add the ability to reuse certain components or services such as authorization, routing, and authentication, that provides a single platform that can easily transition to credit or real-time payments or other payment rails. It's truly a build once but use often design that will reduce over-operational costs and pre-speeder market for alternative payment methods. And I'll turn over to Sarah for her perspective on that. Sarah: Yeah, actually, I think I've got another question for you given those comments, if you don't mind. I hear a lot of financial institutions in particular, talking about the need to modernize their technology infrastructure so that they can be more responsive, particularly at the user-experience layer, thinking about things like breaking down silos to better manage data and better manage data for fraud. But when financial institutions are thinking about modernizing their infrastructure, do you see that payments is often an instigator for a lot of these modernization demands or the idea that financial institution wants to move forward with a modernization project? Steve: Sarah, I think it does. And I know I threw on this term 'build once, use often' is kind of a code word for modernization, and it does sound simple enough to build once and use often. However, really the benefits are very, very powerful and widespread. As we talked about with mobile and contact-less payments, continuing to grow and support for QR codes, digital currencies, request to pay and peer to peer payment applications are added, many larger banks are opting to build separate in-house silos to process these new payment types. And given the large number of dedicated channels that are required to process this vast array of payments, it quickly becomes a very complex undertaking that generates significant cost to support. Steve: Meanwhile, smaller banks are tackling the same challenge by outsourcing services to vendors. While this may work in a short term, it too, can become very expensive and really stifles differentiation and creates barriers to innovation with this 'build once, use often' as the goal to consolidate these single use channels by deploying a payments platform, it is built with the microservice architecture and API connectivity. These platforms really do enable banks to realize the desired end state of building once, but using across multiple payment rails. And to be a bit more specific, if a bank's priority is to start with the modernization of their debit platform, which is part of our topic today, and by the way, often is a logical place to start given that 1st Generation debit payment platforms are quite cumbersome and channel specific. Steve: And really these older debit platforms are edging closer to critical [Inaudible], and effectively the end of life. There are many ways that 'build once, use often' methodology yields significant benefits to the deploying institution. And some examples of that is to add credit to the same system that's used for debit, the settlement and clearing services can really be reused. Another example is in the fraud area where fraud mitigation and some of the limiting safeguards can be implemented once and then used often across multiple channels. Steve: So, with Vynamic payments, we're able to later on the promise of 'build once, use often'. And Diebold Nixdorf is really kind of moving digital payments processing to a new era, introducing an open APIs integrating with best of breed FinTech solutions across banking and retail, and really delivering seamless customer-centric journeys on a state of the art platform. So, quite simply, it is a great time to speak with Diebold Nixdorf about the future of retail payments. Ryan: Excellent Steven, I think that was absolutely fantastic. And I think we'll end it there on that note. Oh, so, Steven, Sarah, thank you so much for taking the time today for speaking to us about the debit rail here and also the very interesting consumer changes that we've seen in the industry of the debit versus credit. And I hope to have you both back on the podcast real soon. Steve: Pleasure. Sarah: Thanks Ryan.

Worried about Ai? Your emotions are your job security, and working with technology will be key to future success in voice over. In this bonus Voice & Ai episode, Anne chats with Ryan Hicks and Adam Fritz of Pozotron - an audiobook proofing service. Listen as they dive deep into the future of audiobook production, and discuss how the connections between human emotion & AI is a voice actor's greatest ally… More at https://voboss.com/voice-and-ai-pozotron-with-ryan-hicks-and-adam-fritz  Transcript >> It's time to take your business to the next level, the BOSS level! These are the premiere Business Owner Strategies and Successes being utilized by the industry's top talent today. Rock your business like a BOSS, a VO BOSS! Now let's welcome your host, Anne Ganguzza. Anne: Welcome, everyone, to the VO BOSS podcast, the AI and Voice series. I'm your host, Anne Ganguzza, and today I'm excited and honored to bring you very special guests Adam Fritz and Ryan Hicks of Pozotron, a powerful AI software that helps audiobook professionals make their audio productions more accurate, efficient, and profitable. Adam is the COO of Pozotron and leads the operations and business development arms of the company. And Ryan has a 10-year history in the audiobook industry, having spent eight of those years as a proofer and editor with Deyan before coming over to Pozotron. Gentlemen, thank you so much for joining me today. It's a pleasure. Both: Thanks for having us. Anne: So if you don't mind, I'd like to start off with serving the need for having a wonderful piece of software like Pozotron. So I'd like to ask, Ryan, since your background as an editor and proofer at Deyan probably gave you lots of reasons to want to have things that would make your job easier. So tell us a little bit about what you did on a day-to-day basis and what type of tools you use to do your job, and then what your pain points were. Ryan: Oh man. So proofing and editing at Deyan. So we, wow. How do I even turn that into something small? Anne: Well, so there were a lot of were a lot of pain points. I would imagine -- Ryan: I mean the whole thing, the whole thing is a pain point. So we would get professionally recorded material and try to make it more professional quickly, in the door, out the door. So we had a series of steps that we would go through to kind of standardize the process of editing and proofing at the absolute highest level. And we had some fantastically intricate manuals about spacing and noise floors and RMS and mastering techniques and what you had to use for all of these things. And then add that to the fact that we're just listening for everything that possibly could be going wrong. Misreads, noises, thunks in the background, wrong character voices, anything that you would have to give a note back to the narrator, that was my job for eight years was finding all of those notes and giving them back. Anne: Wow, so let's just say then for an average size audiobook, how long would it take back and forth between you and the author before you were able to resolve all of these issues? Ryan: So we were super compartmentalized at Deyan. I never talked to an author. I never talked to a rights holder. There was a production manager and a head of post that would take those projects and give them to us. And we gave those projects back to the head of post. Anne: Got it. So how long would you say, do you have an idea of how long it might take? Is there so many days of revisions back and forth or was it weeks before you would finally get the edited version that you needed? And that was correct? Ryan: So it happened a couple of different ways. If narrators were coming in house to the studios at Deyan, they would record during a six-hour session. And at the end of that session, they would send three hours of audio to the editors. And we basically had that day to try and get it done. Anne: Wow. Ryan: So three sessions from a narrator would be about a whole book. And so during that period, we would be editing, and then someone would be proofing after us. And then hopefully within a week, that would be back to that narrator to do the pickups and then finish it up. So we would have anywhere between a 14 and 21-day turnaround. Anne: Got it. Ryan: And we just kept trying to tighten that down further and further and further and make it as efficient as possible. Anne: And I think that there, this is my own experience. I am not an audiobook narrator, however I narrate corporate and long form narration. And so for me, my editing, I can only get it so efficient. There is an amount of time in terms of listening to it to make sure there's no errors as well as the time it then takes to edit those and then go back into the studio and rerecord and then come back and check it again. And so there's a certain amount of time, and I wish I could get it faster, but I just can't. And so I know it must be completely frustrating in terms of having, you know, hours of book material to be able to prove and edit. And I'm just talking, like, maybe my maximum would be, you know, an hour module at a time, and I would do maybe eight or ten modules, but still the process to me, I never got it to a point where I was as quick as I wanted it or needed it to be. And so fast forward to the future, how did you find Pozotron or how did they find you? Ryan: Jamie, my boss, and correct me if you know this part of the story, Adam, it was Jamie that found Jake, right, at a conference? Adam: I believe so, yes. Anne: And Jamie is Deb's right-hand man. And Jamie came to me and said, "oh my gosh, you have to look at this. You have to see what this company is doing." And when he showed me, I'm like, this is ridiculous. We don't need this. I've been doing this for seven years. I don't need some computer program checking my work. I'm fine at what I do. And we set it through dozens of tests. And this is early in Pozotron when they were still kind of working the kinks out. And I never beat Pozotron. I would check my work as soon as I did my foolproof, and I would run it through the software, and there was always things that I missed. Anne: Wow. Ryan: And so I finally, you know, as much as I shook my fist at it, suddenly I had a backup, right? I had a backup, and as soon as I was done, all we had to do was upload the files. And 20 minutes later, I would get a chance to scan through. And there it is, there's those three things that I missed. Anne: Wow. Ryan: There's those five things that I missed. And so we would add that onto my proofing report, and suddenly pickups that were coming back from the publisher, not just from me, but through all of our proofers were coming back in the single digits. And it was, it was awesome. That transition was great. Anne: That's incredible. So you were kind of a, you're a believer now. Ryan: Yeah. Having that safety net when you're -- Anne: Yeah. Ryan: -- when you're tired -- Anne: Absolutely. Ryan: -- when you've been working for eight hours already having that backup was fantastic. Anne: Awesome. Okay. So Adam, let's talk a little bit about Pozotron and how did the company come about? Adam: Like any good software company, you know, the, the core software is designed to solve a pain point. Anne: Yeah. Adam: So it's actually almost reversed. A lot of software companies see, okay, here's problem X, how do we create a solution to solve that problem? But in this case, it was almost backwards. Jake Poznanski, our CEO and founder, really wanted to get into AI. He'd exited a gaming, a mobile gaming company and was looking at AI and machine learning, and really liked some research going on about forced alignment. That's basically matching text and audio files together, and basically came up with the idea of the technology and then went about trying to apply that technology to a problem to solve. So he almost went around it backwards, um, came across the whole concept of audio -- he was a big listener of audiobooks and just how -- manual isn't the right word, but how time-consuming it was to prove an audiobook. Anne: Yeah. Adam: I mean, when I describe it to people who are not at all involved in the industry, you basically sit down with a PDF and headphones -- Anne: Yeah. Adam: -- and have to listen and read at the same time, which is tremendously difficult. So basically he designed it as not a way to replace a proofer, but designed this really fantastic and unique tool as a way to add that kind of extra set of eyes. So really the whole goal of Pozotron on the proofing side, that is our core technology, is to get the ratio of time spent proofing to the actual time of the audio or as close to one-to-one as possible. Anne: Yeah, right. Adam: So it should take an hour of time to proof and report on the pickups for an hour of audio. Anne: Makes sense. Adam: Without Pozotron, I think that's certainly a much higher, probably a two to one or three to one at least ratio. The goal with Pozotron is still -- Anne: Oh, absolutely. Adam: It's going to take you an hour to listen to an hour of audio, but instead of doing that, and then spending 20 minutes or half an hour putting together a pickup packet by copying things -- Anne: Yeah. Adam: -- out into an Excel spreadsheet -- Anne: Sure. Adam: -- you click two buttons, and that pickup packets ready to go, and you just email that to your narrator, and they start recording right away. So that's really the goal is to get that ratio as close to one-to-one as possible. Anne: Yeah. And I'll tell you, that's very interesting because, for as many years as I've been in the industry doing long form narration editing, I have never been able to get quicker than one to three, and I am a stickler. You know what I'm like, no, I can do it. I can, I can get better than that. And I just can't, and it's, it's frustrating. And it's time-consuming, and it's also, it's very tedious. It's one of the, I would much rather be in the booth doing the creative, doing, you know, what I like to think I do best, you know, the artistry of it all to be in the booth and do that. And many people will outsource their work to an editor, but I always like to have the first check for myself. And it's not that I wouldn't outsource it, but that still, even if I outsourced it to an editor, it would take the editor just as much time as me or probably a little less, if that's all they do. But there was always that time element. And I could never get things back as quick as I really needed them or my client wanted them to be. And also if I had like a quick pickup to do, and I had an editor and I had outsourced it to an editor, they usually put their own filters on it that they don't necessarily tell me, or they might be using a different software. And so therefore, if I needed a really quick pickup, it was one of the things where if I outsource to an editor, it became a little awkward if I couldn't get that editor like right away, you know? And a lot of times the client would be like, well, look, it's just one sentence. Why is it taking you two days to get me that sentence back? And it just might be because I'm trying to tie in the editor's time as well. So that just added to it all. So I can absolutely see the pain point of needing something, or it would be wonderful to have something that could get it down to a one-to-one ratio. So tell me a little bit about how your software does that or how it works, kind of on a step-back scale. Adam: Yeah. So basically the end goal is if you've never seen how Pozotron works, you press play, you upload your manuscript, you upload your audio, our forced alignment algorithm basically pairs the two and gives you essentially what -- to simplify it, it's kind of like a spellcheck for recorded audio. It gives you an output of what we call annotations, which are things Pozotron thinks are a missed word. So a word that you, in the manuscript, you didn't say it during the narration, an added word, which happens a lot. I have two young kids and I read them a lot of stories. And it's amazing how often I just add words for no reason -- Anne: Yeah. Adam: -- mispronounced words, as well as extra long pauses. So really the goal is what it does is it gives you an output saying, hey, you just put an hour of audio in. Here's the 32 things that Pozotron thinks are incorrect. What you need to do then is as you're going through, we recommend that people continue doing their full listen. So listen to every second recorded. Um, but what it does is allows people to decide, hey, Pozotron thinks that I mispronounced the word microphone because I'm looking at the word microphone on my computer right now. And you need to listen to that and say, yes, that's a mispronunciation or no, it's not. If you click pick up, it automatically goes onto your pickup report and eliminates all that manual time of creating those reports. But at its core, we have a forced alignment algorithm based on tens of thousands of hours of audio data that basically take the spoken word, compare that to the text word. And then using a probability matrix, says, we believe that this was correctly pronounced or incorrectly pronounced, as close to a 100% accuracy as you could ever get. Anne: Got it. How does it handle like words like names and how does it, how does it handle accents and different languages too? Adam: So I'll answer the last part first 'cause that's the easiest. Anne: Okay. Adam: Uh, we currently support English, Spanish, Swedish, and then French and German are in beta right now. Anne: Okay, okay. Great. Adam: So we do support them, but they're just not at the level of accuracy of the English or Spanish, primarily just because we don't have that volume of data -- Anne: Okay. Adam: -- to continue training our algorithm on. In terms of names, really, as long as it is a phonetically pronounced name, Pozotron will be able to handle it. In the name of like, what's a good example of -- a word that is spelled one way and pronounced something completely separate. Um, Pozotron will occasionally have trouble with that because what -- the way Pozotron works is, if it is phonetically correct, it will mark it as correct. But if it is, um -- Ryan, do you have a good example of a word, of a word like that? I can't think of one off the top of my head right now. Ryan: I mean, we keep using lagxoor as our sci-fi name. Anne: Lagxoor. Adam: So that would be spelled L-A-G-X-O-O-R, but pronounced L-A-G-Z-O-O-R. Pozotron will mark lag sewer as an incorrect pronunciation of L-A-G-X-O-O-R because phonetically it's incorrect. So that's why Pozotron a lot of the tools we have, our pronunciation analysis tool, our character voice guide is great to help narrators, authors, production managers, anyone involved do their preparation before the project even starts. So our proofing tool's designed to catch pickups after they happen. Our prep tools are designed to stop pickups from before you've even started recording. Anne: Can you train it for a specific name somehow or phonetically spell it so that it can then, I guess, mimic or figure out if that's correct or not? Adam: So there's a couple of things. One, yes, every time we retrain our algorithm, it gets more and more accurate. But what you can do is we have a -- let's say that Lagxoor, for example, say it's a main character, and Pozotron for the 200 times it's mentioned in the book -- Anne: Right. Adam: -- Pozotron thinks, "we think this is incorrect." Anne: Right. Adam: We have a filter out button that basically is like the ignore all in Microsoft word when you're doing spell check. "This is not a mistake. Pozotron, I know you think this is a mistake because it's phonetically wrong." You click filter out, and it will ignore every other mention of that word. Anne: Got it. Interesting now, okay. Here's a question just because I do a lot of work in medical, and a lot of times in medical, like, I don't know the word enough, so that each time it occurs in the instance of my script, that I can pronounce it exactly the same, unless I go, and I mark up my script, and I phonetically spell it each and every time, I might forget like that 10th time to emphasize the middle syllable, rather than the other syllable. Will it catch those? Or is that something that we have to just, you know, we're on the lookout for that? Adam: So again, two answers there. So the first one is we have a tool called scan occurrences, which we should probably rename it, something a little, a little better than that, but scan occurrence is what it allows to do. So let's say for example, "doliosolaphic," um, which I, I mispronounced, I butchered that, but I named that because it came up in a demo I did the other day. You can choose that one word and click scan, and it will play every single mention of that word in the audio, back to back to back to back to back. Anne: Nice! Adam: You can listen to that straight through for consistency. It's great for character names as well. Anne: Oh, that's fantastic! That'd make my life easy, a live. Adam: I have an example of a customer the other day, who was doing a book, and the word shaman, S-H-A-M-A-N, which could be pronounced "Shaw man" or "shay man". Anne: Right. Adam: He pronounced shaman nine times as "Shaw man" and one time -- Anne: Right. Adam: -- for "shay man." So he used that feature to catch that, and then you can select individual ones and either mark those individual examples of that, mark those as a pickup in your audio, or you can just export a DAW file to put a marker -- Anne: Sure. Adam: -- in every mention of that word in your, in your DAW file or your DAW session to help your editor. Anne: Got it. So then at the core of all of this is AI, right? Adam: Yes. Correct. Anne: That is, it's learning. So when we upload our manuscripts and we upload our audio, is that going into help the model become more intelligent, or do you have a model that exists already and you're feeding it other data? Adam: We started by bootstrapping with publicly available data, whether it's Librivox or any of those other things. Anne: Sure. Adam: But when someone uploads audio, it's very spelled out in our terms of service, and we're going to be redoing our website right around Halloween. We'll be launching a new, just explaining exactly what we're using data for. But essentially what we do is we take random snippets of audio, audio and text paired together. And we feed those into our algorithm to train it. And this is not training it to replicate the human voice. This is training it to better recognize the human voice and the exact thing that is spoken based on the text. Anne: Got it. Adam: So it's basically just, it's almost like every bit of audio is like another drop in the swimming pool. None of it is -- you can't identify a single drop of water in a swimming pool. It all gets aggregated. Yeah. That's what we do. We basically make it so it's completely non-identifiable from an individual voice or anything like that perspective or personal identified information. But what it does is it just continues as we feed more and more data in and retrain, it just makes it more and more effective because we have more examples, more different accents, more different dialects to improve the accuracy of our algorithm. Anne: Got it. So now, do you have any plans to ever like create voices at all in your software in order to like maybe help with pickups? Or is that something that you're not really looking at? Adam: So I'm going to start with what exactly what it says in our terms of service, which is we can never do that -- Anne: Okay. Adam: -- without the express written consent of the person who uploaded the audio. Anne: Got it. Adam: So currently it is not in our plans, even from, from a business perspective. Even if we wanted to, there are companies out there that have a four or five-year headstart on us. Anne: Sure. Adam: So it would be kind of a dumb, it would be a dumb business decision. Um, I could see a future where maybe there would be a feature where you could say, say, you said, Anne instead of V, you could have a, you know, basically copy and -- Anne: Paste. Adam: -- copy and paste that word. But from a, from an AI perspective, we have, we'd have to be pretty careful on how we manage that and negotiate that with our customers -- Anne: Sure. Adam: -- because we would never do it in the way that is looking to replace that customer in full. We'd just be using that -- or that narrator in full -- we'd just be using anything that we ever did, which is quite a ways out, based on the current product roadmap. Um, it would be an assist to that narrator and not be to replace that narrator. Anne: Got it. So, in terms of, let's say AI, AI in general, people fear it because I think for the most part, a lot of that fear is based on, they don't necessarily know exactly how it works or -- and they're probably very fearful that it's going to take their job away, which is not a surprise that people in the voiceover industry are afraid that AI is going to take their job away. And so what is your outlook on that? What do you, what do you say to that in terms of your software? And I know that you're not creating voices at this moment, but you are using AI technology. Adam: Yeah. So AI by itself is not Skynet from Terminator. It's not something to be feared. It's kind of like AI does what it is designed to do. So if it is designed to replace a narrator, that's what it'll do. In our case, if it is designed to be an assist to a narrator, that's what it'll do. So AI by itself is not something to fear. Reality is the companies that are creating AI voices are getting better and better. I've listened to a couple of samples lately, and some of them are really good, but the human narrator will always have that lead in terms of the humanness of the voice that -- Anne: Sure. Adam: -- no matter how much -- it's like that Tom Hanks movie, "The Polar Express" a while ago where it almost got to the -- the animation was so accurate, it got weird. It was -- Anne: Yeah, yeah, yeah. Adam: I think it's called the -- Anne: Uncanny valley, right? Adam: Uncanny valley, that's it. Anne: Yeah. Adam: It's the same thing with AI narrators is -- Anne: Sure. Adam: -- I don't think no matter -- it'll never get all the way there, but the advantages the AI narrators have over humans is they're faster, they're more accurate, and they're cheaper. So people -- we basically say, look, Pozotron is a tool. Anne: Oh wait! Say that again, please. That I, you know, how many people are going to love to hear you say that? That humans are cheap -- you know, in reality, I think they are. Adam: Yeah. So I think that's the advantage. The advantage is not that the AI narrators are better than humans, human narrators, because that's not. Anne: Exactly. Adam: But they're faster -- Anne: yeah. Adam: They're faster, they're more accurate, and they're cheaper. They're most of the time more accurate, I should say. Anne: Yeah. Adam: So using a tool like Pozotron, humans will always have that lead -- Anne: Yes. Adam: -- in the humanness of their voice -- Anne: Exactly. Adam: -- but using tools like Pozotron or many other things out there, or even just a better workflow, will help humans catch up to those AI narrators in terms of speed, accuracy and efficiency. So we kind of pitch our tool as it's almost a way for narrators to stay ahead -- Anne: Sure. Adam: -- of the AI voices that aren't going anywhere. So that's really what we're trying to do is, you know, use the same tools to help narrators rather than take over some of this stuff out there. But I will say one thing, I think, no matter how good these AI voices get, there will always be a place for human voices. Anne: Yeah. Adam: I think and a lot of these companies are saying, look, we're just narrating the backlist or, you know, it'll be great for a history textbook. Something that's a thriller or a romance that requires that human emotion -- Anne: Sure. Adam: -- to really make it a piece of art that audiobooks are rather than just something to listen to. One of -- our CEO said the other day, "look, if I wanted to listen to a cheaper, crappier audiobook, I'd say, 'Alexa, read me my book.'" Anne: Interesting. Yeah. And you expect it, and I think when you hit that uncanny valley where it becomes too human, you're right. It kind of, there's a point where you believe, you think it's human, then all of a sudden, maybe you'll hear that note that kind of doesn't sound right. And it'll be like, "ooh, did I just get duped? Is that a person? I thought that was a person." And then I think there's a whole trust factor when that hits. And so I agree that I think when you need that human element, I think we'll always need that. And I think in that respect, that is quicker than AI in terms of, you know, some of the companies that I've been talking to and what I've seen right now, out in AI, while these voices are great or they can sound pretty human, I think they're only human in one instance. So if you ever had to go back and redirect, right? Adam: Yeah. Anne: You know, that emotion that they just emoted, it's the same, no matter if you put it at the front of the script or the, in the middle of the script of the end of the script. And I think if you have a human that you can redirect and have a slightly different nuance of sad, I think that's where humans are quicker and can actually -- I don't know if you can say it can be cheaper because I think these AI voices, they're on computers. They basically are generated by engines. And so somewhere in the ethers, you know, there's a computer out there creating that job or creating that audio for the job, and there's money, you know. Adam: For sure. Anne: There's -- that costs money. And so I feel like the human will always be there. What type of audiobooks -- both, I'd like to get both of your opinions -- what type of audiobooks do you think an AI voice is appropriate for? Or is it not? Adam: Appropriate is a -- appropriate is a different word. Anne: Yeah. Adam: I think instead of using appropriate, I would say acceptable maybe. Anne: Okay. Adam: Anything that's not going to require huge conveyance of emotion or feeling. So that's where I think, you know, educational materials, textbooks, things like that, where you're just absorbing information, I think it is less problematic than if you're reading a book, and there's a scene where a family member dies, and it's really important that that narrator captures that sadness and all those emotions and the subtleness -- subtlety of emotions. Whereas, you know, an AI narrator probably -- or even if the AI narrator can do that, my understanding is currently there's a lot of manual work in the backend essentially saying on this syllable, AI narrator be sad, on this one, pick it up a little bit. Anne: Sure, sure. Adam: So my understanding is currently there is some manual stuff that needs to happen for it to work -- Anne: Yeah. Adam: -- entirely properly. Anne: Yeah. And I think that it starts to take as much time if you need to dial that emotion to a certain way or dial the speed or whatever, you're, you're changing in that AI, I think you're going to spend more time post-processing to get it to sound more human. And then it ends up taking possibly longer than a human, you know, utilizing something like Pozotron to help, right, proof and get their job done faster. Interesting. So what do you think then is the future of AI for, let's start with what would be the future of AI and how it's being used at Pozotron? And then also, how do you feel AI will ultimately be in five years or ten years? Will it take over the voiceover industry? Or what do you, what are your thoughts? Adam: I'd like Ryan to talk to his -- Ryan's got a really, I mean, we all share it, but Ryan's got an interesting vision on kind of the future of audiobook production with human, with human narrators. I'd like you to go into that, Ryan. Ryan: So as far as the future of AI in Pozotron, I don't even think of it in terms of AI, as I'm working through my day, as I'm doing my testing. That doesn't enter into much of my thought process. Having spent thousands of hours looking for misreads and doing reporting, those two things were the absolute worst part of my job. They are the hardest to do consistently. It's the easiest to make mistakes. And the fact that there's a tool, whether it's AI or not, that makes that part easier, that's my push. That's my function. The fact that AI is there helping make that part better for the proofing process, for the scanning of scripts, for all of that, it's that way to make things easier for people, and the, the AI part of it, the mechanics behind it, don't concern me all that much as a technician. And on the creative side, I would love to see AI be that tool that makes the performance go to that next level. You know that you have an AI behind you telling you when you make your mistakes. So you don't have to worry about it. Anne: Yeah. Ryan: As a narrator, okay, you have these seven pages to do and "oh, am I going to make any mistakes? How long is it going to take, you know, my engineer to get that back to me, who do I have to turn it into next? How do I note it?" All of those things are going to be in your head, but if you have a complete set of tools that look for those things, you can be absolutely peaceful and zenned out, knowing that you have this extra set of eyes and ears and knowledge behind you. And so the future to me as a performer, being able to come to their tools, their microphone and their computer, and do an entire production on their own and have it not just a one-to-one ratio with editing or proofing or -- but a one-to-one production of the whole thing, how they want it, how they love it, how it's supposed to sound. So that's what I see in a few years is a set of tools that allows you, Anne, to go up to your station and make an audiobook. Anne: I love that. Ryan: That's what I see. Anne: Yeah. Ryan: That's what I'm excited for. Anne: Yeah, it gives you the time and the peace of mind to go and be an artist -- Ryan: Yep. Anne: -- which is what you are meant to do, and not necessarily worry about how long it's going to take to edit. I love that outlook. That's wonderful. Thank you for that. Absolutely. Adam: From the AI side of that, it's really just taking either algorithms we built or algorithms we are building to basically make all of the work around audiobooks easier. So an example right now is in our next step of this character voice tool that we're using, we're building an algorithm that will score, yeah, every single mention of a character's name based on two attributes. One of them is that character. So let's take, for example, Sherlock Holmes links to a verb denoting speech also modified by an adverb. So it'll take every single mention of that character's name and the book, and give you an output of the top 20 examples of that character speaking, where there is a description about how that character spoke. So when you're putting together your character voice prep -- Anne: Wow. Adam: -- and deciding as a narrator, hey, this is the voice I'm going to use -- Anne: Yeah. Adam: -- you can use our tool scan to through the top 20 mentions saying Sherlock spoke aggressively, Sherlock spoke in a high tone, Sherlock spoke, exclaimed sadly, or something like that. Where you can basically use this tool to easily figure out all the cues from the book and then plan out your character's voice. Anne: Wow, that's great. Adam: And then the other side of it, so really instead of having to do what they're currently doing -- Anne: Yeah. Adam: -- which is reading the book with a highlighter and taking note of everything they're doing, you can parse an entire book and take all those cues in a fraction of that time while still getting the same high quality work. And then the next step of that, that we've already built into our pronunciation guide, is once you've done your work, you've created your pronunciation list. You've created your character voice guide. You can currently export that into a marked up PDF where every word in your pronunciation guide is automatically highlighted in your script with a call-out box saying this is the phonetic pronunciation -- Anne: Wow. Adam: -- or this is your note saying how, how that voice should sound. And then in the future, it's going to be a teleprompter where instead of just seeing a call-out box, you click play, and you listen to yourself speaking in that character's voice. You pause your recording, listen to yourself, and then click record again and start going. So removing all of those -- Anne: Oh, that's wonderful. Adam: -- switching between apps. Anne: Yup. Adam: And, you know, some people have their character list on their iPhone in a note -- Anne: Yup, yup. Adam: -- or something like that, everything is centralized and that takes -- gets us closer to that one-to-one recording time to finished hour of audio time. Anne: Right, so you can get right to the point in your wav file that you need to be. Because when I go back in and have to do pickups, I have to hunt for where was that? You know, where was that part in my, in my single wav file there that I said this particular thing that I have to do the pickup. So that's, that's phenomenal. I, I think what a wonderful tool. How can BOSSes out there get in touch with you, find out more about your software, maybe -- is that a subscription based model? Adam: Um, so first, uh, they can check us out at www.pozotron.com. That's P-O-Z-O-T-R-O-N.com. Um, or email us at hello@pozotron.com. Uh, we have a number of pricing plans from pay as you go, which has absolutely no subscription. You pay $10 per hour of audio you upload, all charged down to the minute, but it's easier to say $10 per hour than 16.667 cents per minute, but all the way up to, you know, we have some, some of the biggest publishers are putting six, 700 hours of audio a month, and you're getting, and you're paying a much reduced per hour rate based on whatever volume you're doing. So we have very flexible plans from literally you put in 10 minutes of audio a month up to thousands of hours of audio a month. Um, we're very flexible and our subscriptions are only ever month to month. So if you have a big, either increase in volume, you can jump up to a bigger plan. If you have a lull over the Christmas season or holiday season, um, you can go down, 'cause we never want people to be paying for something they're not using because we're a believer in, you know, we'd rather lower our revenues from a customer for a month to make a happier customer because that customer is going to stay with us over the longterm. Anne: Fantastic. And I'm going to push for anybody that does long-form narration, really. I can absolutely see this as being a tool that can really help us, so fantastic. You guys, thank you so very much for joining me today. It has been amazing, and BOSSes out there, make sure to check out Pozotron. I think it's going to really help you do your job better, and thanks again for sharing your time with us today. And I am going to give a great, big shout-out to our sponsor ipDTL that allows us to connect and network like BOSSes. Find out more at ipdtl.com. Thanks again, Ryan and Adam. It's been a pleasure. Ryan: Thank you. Adam: Thank you very much. This was, this was really fun. Anne: Awesome. Alright, BOSSes. We'll see you next week. Bye-bye. Adam: Bye! Ryan: Bye! >> Join us next week for another edition of VO BOSS with your host Anne Ganguzza. And take your business to the next level. Sign up for our mailing list at voboss.com and receive exclusive content, industry revolutionizing tips and strategies, and new ways to rock your business like a BOSS. Redistribution with permission. Coast to coast connectivity via ipDTL.

Ten years ago, Ryan Frederick, became a partner at AWH, a now 26-year-old firm that builds net new software products, solves data problems, and integrates systems across platforms and products (phones, the web, Internet of Things [IoT] devices).  The client mix is split in thirds: Funded startups building disruptive products to capitalize on unique opportunities Midmarket companies (manufacturers, distributors, or nonprofits/social enterprises) who don't have much technological knowledge or “horsepower” and a one-time or only sporadic need to build a “digital fix.” Enterprise clients that need prototypes and proofs of concept for corporate innovation initiatives (e.g.; leveraging blockchain technologies, integrating machine learning, and utilizing artificial intelligence). These companies have the resources to build the needed system but need guidance on how to approach a problem and what needs to be done. To ensure the best outcomes, AWH consults with clients and establishes advisory boards to iteratively build products that resonate with customers and provide value. Ryan started out his career as a software developer but migrated to the “business, human, and creative side of things” – because he was interested in utilizing a more complete mix of skills. In this interview, he talks about how developers have been maligned in the past for not caring about the quality of the code they wrote. He admits that a lot of bad software was written when developers were a “background assembly unit” and the practice was to “slide the requirements under the door” and direct developers to build what they were told to build.  Ryan says today's developers, designers, and QA professionals demand interesting, challenging, impactful work and need to be involved from the beginning – in defining the problem and in the planning, design, and user experience processes. Losing team members mid-project destroys process, teamwork, and collaborative continuity and chokes progress as “replacements” need “ramping up.” AWH's focus, particularly in the last 5 years, has been on creating an environment where team members feel valued for their work – in order to “get and keep the most talented, capable team” possible.  AWH often works with funded startups that often come up financially short at times where continued development is critical. To address this problem, AWH formalized an internal financing mechanism where AWH lends monies to cover continued development work in exchange for client royalties or equity. Ryan says AWH has done this 20- or 30- times, not so much by choice as by necessity. A few “loans” have “gone south” – but the company, to date, has accrued royalties or client equity of almost $2 million.  Ryan authored The Founder's Manual, an experiential exposé of things Ryan has seen work . . . and not work . . . in the development world. His second book, Sell Naked, covers his experience over the past 10 years of owning and leading a professional services firm. Ryan says a lot of service firm representatives sell “propaganda, paraphernalia, and crutches” and 999-slide capabilities decks rather than starting with an open, authentic conversation about client needs. He says, “No prospective client cares about how awesome you are until they believe that you understand their problem and that you can . . . help them alleviate the pain of the problem. He also explains the informal proposal email process his company uses to quickly and effectively close contracts. Ryan can be reached on his company's website at: AWH.net. Transcript Follows: ROB: Welcome to the Marketing Agency Leadership Podcast. I'm your host, Rob Kischuk, and I am joined today by Ryan Frederick, who is a Principal at AWH based in Dublin, Ohio. Welcome to the podcast, Ryan. RYAN: Thanks for having me. Appreciate it. ROB: Wonderful to have you here. If we're looking up AWH and what you focus on, it says “building great digital products.” But why don't you give us the big picture of AWH and what that specialty really means when you talk about building a firm around that?  RYAN: Essentially, we do one thing, and that is build net new software products for clients across the spectrum of startups to midmarket to enterprises. Around the building of net new software products, we also do a fair amount of data work, solving data problems, data plumbing to support those products, integration work – because rarely do software products now exist on their own without talking to other products and other systems – and then we do a fair amount of product consulting as part of it, too. We help clients establish customer advisory boards, for example, to be able to work iteratively in building a product to ensure that it resonates with customers and they find value from what's getting built. So some wrappers around that core of building software products, but at the core, we build net new software products that run on phones and the web and IoT devices and various places for lots of different purposes and to solve lots of different problems. That's our day job and how we butter our bread, so to speak.  ROB: Got it. Is there a typical sort of firm, a sort of client that's looking to engage you? Are we talking about seed stage funded companies, are we talking about enterprise, are we talking about all of the above and then some? RYAN: Our business is mixed in about thirds. About a third of our clients are funded startups trying to build a net new disruptive product in many cases, where they're going after a space and a problem or to capitalize on an opportunity that is fairly unique; otherwise they probably wouldn't be starting a company around it. About a third is midmarket clients. Those are manufacturing companies, distribution companies, and in some cases nonprofits or social enterprises that are trying to become more digitally capable. Often, they are digital laggers. They don't have the technology teams, if any technology teams, and they need things like customer portals built and they need design tools built and they need customer apps built, etc. So in the midmarket, it's really I would say them becoming digitally capable if not exceptional to fuel their growth. If they're a $50 million company, how are they going to get to be a $100 million company? If they're a $200 million company, how are they going to get to be a $500 million company? And that answer now is almost always digital and technological in some way. So that's where we typically play in midmarket space. Then with enterprises, most of our enterprise clients and engagements are around some sort of corporate innovation initiative, trying to figure out how they're going to leverage blockchain, what they're going to do with machine learning or artificial intelligence. Then we engage with them to build some prototypes and some concepts, and they'll then take it and run with it moving forward. We don't want to, in the enterprise space, do a lot of uninteresting work. We want to be able to stay true to our DNA and our desire to build interesting things, because frankly, that's how we keep really smart, talented people – because they want to build interesting things. So we tend to shy away from enterprise work that is just “upgrade something that's been running on a mainframe to something that's now modern.” We tend to stay away from that sort of stuff and focus more on the corporate innovation stuff inside of enterprises. ROB: Obviously, with a new company, I can certainly understand how they would look at what they need to do and say, “We don't know how to build technology. Let's call up Ryan and his team.” What do you think is the missing ingredient, perhaps – when you get to the mid-stage in an enterprise, I would imagine in a lot of these cases, you're talking about standing up a team of two, five, ten people to accomplish something that you would certainly imagine could be in the reach of such a company. What do you think it is that keeps them from sometimes even building that capability, or wanting to, when innovation is so important? RYAN: I think it's different between the midmarket and enterprise. In the midmarket space, clients will engage with us because they don't have much technological knowledge or horsepower. They also don't envision getting a substantial amount of it, either, because if you're a bolt manufacturer, there is a point where technology needs to serve you and you need to leverage it, but you also then don't need a team of 10 technologists running around that you're paying a ton of money to not do anything of consequence on a daily basis. Most of our midmarket clients build one software product that would be considered a custom software product. They build one of those in the entire history of their company. If you're a $50 million company and you need to build a customer app for ordering or what have you, it's probably the first time you've ever actually built your own software product, and you probably aren't going to have to do it again for a very long time because you're filling a gap that has now become so painful that you have to address it. But you're also probably not seeking to run around and build a bunch of new software products. That's the reason the midmarket clients often don't have their own teams and don't have a desire to implement and build out their own teams, because it's sort of a moment in time for a midmarket client. ROB: It's not as much of a sustained need, but it comes in bursts, and they need to know who they can trust to come back to it time after time, even.  RYAN: Yeah, absolutely. But they are moments in time where there's a problem that has to be addressed, and then once it's addressed, the pain has subsided for some period of time. Enterprises are a little bit different, and that's why we mostly focus on innovation work inside of enterprises. Most enterprises have IT, design, product capability, either internally or through staffed augmentation or contracting firms. They have more people and more resources than they know what to do with in most cases, frankly. That's why we don't really want to play in that area, because it's just not that interesting to us. But we will come in, and enterprises often use us as like a special projects firm, where they're trying to figure out, “We've got this problem; our existing team doesn't know how to address it. We need help figuring out how we approach this problem. What's the right technical solution? What's the right digital solution? What's going to add that value for the business, and what's going to align with our customers and our users?” We do a lot of enterprise work, frankly, where we're just helping them concept things from a design perspective and a problem statement perspective and to build out customer advisory boards. There's a lot of cases with enterprise clients where we don't write one line of code and we have no engineers from our team actually engage with enterprise clients. It's more about helping them figure out what the right thing to do and the right thing to build is in the right way than it is actually doing a lot of wrenching on the product behind the scenes, if that makes sense. ROB: For sure. Ryan, it looks to me like you just might've celebrated a 10th anniversary for the company. RYAN: I did, yeah. ROB: Which is pretty exciting. Congratulations. If we rewind 10 years, how did you end up in the direction that the firm is in now? What led you to start it in the first place? RYAN: The firm's actually been around for 26 years, and I joined 10 years ago as a partner. I was coming down off of something else, and I was looking for something to do, frankly. I reached out to my network and said, “Hey, I'm looking for something to do,” and my now-partner Chris said, “Why don't you just come here?” I said, “Oh, didn't know that was on the table.” We talked for a few weeks, discussed what that might look like, and then we came together around it. I think the biggest evolution for us as a firm has been that software and data continue to eat the world, but you have to pick and choose where you want to dig in and where you want to leverage your team's expertise and experience. For us, we could be doing lots of different things in and around technology and software products, and we've said we're going to focus on building net new products. That's surfaced well because we really want to make sure that we're adding value for our clients. We also want to make sure – and this is becoming increasingly more important – that we're adding value for our team. Our team could work anywhere besides our firm, because developers and designers and QA professionals, everybody in our team is desirous and a value to work at, I don't know, 100 million other places. So. for us, we have to be way more intentional about creating an environment that they feel valued in and that they can ply their craft in and that they can do exceptional work on behalf of our clients. That's been a significant evolution. The days when you could get a developer or designer and hang on to them forever just by virtue of staying in business and continuing to have a paycheck deposited into their account, those days are gone. If you're not doing interesting work that they find challenging but also impactful, you're probably going to have a turnstile of team members. As a services firm, a turnstile of team members is one of the worst things you can have happening and going on because you have no continuity of process, you have no continuity of teamwork and collaboration. Client projects get upended because somebody new has to come in and get ramped up, etc. So our focus, especially over the last five years, has really been on how we get and keep the most talented, capable team that we can. Everything else is a derivative of that. ROB: Any one of those sharp developers or designers can go out and get into a bidding war and they can pit Google against Amazon, and it can ring the cash register if that's their priority. So it certainly has to be something different. I am a bit curious; if I'm looking at your background a little bit, it looks like you come from, pre- and maybe even with AWH, more of a sales background. Is that fair? RYAN: Yeah, I started out as a developer and then realized I didn't want to write code every day. I then migrated over to the business side and then got fortunate and hooked up with a startup fairly early in my career. I was the third person into the company. Learned a lot about business and also how to build software products. It was a software company. We had some success with that. The company ultimately got sold, and then I started another company with the investors that were behind that one. We had that for a short period of time because we ended up getting an offer to buy that, so we sold that one. I enjoy the technology aspects of things, but for me personally, I enjoy the human side of it and the creative side of it more than the analytical bits and bytes side of it. So I migrated over to the business side because I wanted as much of each side of the brain as I could get on a daily basis because that was the most interesting to me. ROB: And that early background as a developer helps put everything in perspective. I was certainly wondering – I come from a software development background; I have a pretty good understanding of what it takes to motivate and retain software developers, and what you were expressing resonated with me and showed an empathy for that developer mindset. If you came from purely a sales background, I was going to ask how you came by that understanding, because it is deep, it is resonant with my own experience. Having your feet in the technology early on helps tie it all together. It's a really fascinating journey. RYAN: Yeah, absolutely. Developers are often maligned for not caring about what code they write and what the application is and what problem the application is solving, etc. That's true to some degree, but my experience is that most developers actually do care about what they're working on and why they're working on it and what the problem is and what the value of the software is going to be. I think coming from a developer background initially, I have a little bit of empathy for their perspective and their role. It's also been the case where in a lot of organizations, developers are treated as the assembly line in the background that “We're going to slide the requirements under the door, and you just write code against what we tell you to build.” That's how a lot of bad software products got built. And now we realize, if you're going to build great, successful products, developers need to be involved from the beginning. They need to have as much context as they can have. They need to be part of the planning process. They need to be part of the design, the user experience process. This is not you figure out what to build and then pass it off to the development for them to build it. We discovered that that really didn't work, even though that's what we kind of wanted to have happen. So development, even as a craft, has evolved too. It's certainly less cookie cutter, and it's become valued to the level that it always should've been valued and not some smarter people than developers figuring out what would need to get built. Developers are now at the table, working with the other members of a product team to figure out what should get built. ROB: I'm interested; you mentioned that a significant portion of your business is in early stage. I note that you also invest in companies at times. I think a thing a lot of services firms face when they're dealing with early stage is they get asked to invest some portion of their fees into their clients' companies, essentially. As someone who invests and has a services firm serving these companies, how do you think about those tricky conversations? They're challenging, I think, from a valuing the client well perspective, from what you communicate, how it's perceived, all that. RYAN: Absolutely. They're tricky conversations. My base position is a services firm should never discount services and should never trade services for equity unless there are special circumstances and there's awareness of the client and what they're trying to accomplish and there's good reason to do so. With that said, we got into a situation – we have formalized our work then and now because I didn't want to do it haphazardly. To your point, if you're going to have clients that are early stage companies as part of your client mix, the question around services for discounts, services for equity, services for delayed payment, etc., it's going to be a real and present thing that you're not going to be able to avoid. We got to the point with a client a few years ago – probably five years ago, maybe six now. They were a funded startup, but they were in between funding rounds, and we were working on their product, and still are their outsourced product team. They said, “We're not going to be able to raise our next round if we don't continue to work on the product, i.e. if you guys don't continue working on the product.” So we were at a crossroads. We said, well, we can either stop working and they can go out and see if they can raise more money with the product where it is. If they can't, that means the whole thing comes to a screeching halt, so that's not a really good outcome for anybody. Or we can continue to work and we can essentially finance the work until they raise their next round of funding and then we get paid back. We thought that was the better option, so we actually put a promissory note in place and we financed the work under the framework of this promissory note. It all worked out and it all played out as we hoped that it would. We've now done that probably 20 or 30 times over the last couple of years, where we've actually put a financing mechanism in place with some clients. I would rather have not done it, but I'm glad that we formalized it and we didn't treat it haphazardly, because you're talking about real money. Services firms are cash flow monsters. You pay your team to show up today, to ply their craft, to do their work, and then you collect from clients at some point in the future. By the very definition of that, every services firm is a bank. If you then pile on top of that some clients need extended terms and relationships, like we're talking about, you'd better at least treat that dynamic and those monies and that relationship as formally as you absolutely can so that everybody knows what's at stake, what's happening, who's committed to what, who's on the hook for what, etc. We now have this little financing arm inside of the firm that we've now financed and in other ways taken royalties or actually taken equity in some clients, up to at this point almost $2 million. I would rather have not done it, frankly. But we didn't really have a choice with one client, and then over time, we've now had a couple dozen clients that have gotten into a similar situation. And knock on wood, most of them have gone well and progressed well and the deals have made sense. We've had a couple that have gone south, but from a percentage perspective, it's mostly gone okay. But it was really out of necessity less than it was out of “Yeah, we're stoked to do this.” ROB: Yeah, it's challenging. It sounds like you're looking at a way to be a good partner to a company that trusts you to be a good partner in other ways. But that's a two-way street, and that's not to be trifled with either. You've been sharing all along some good lessons, but I think it would be remiss not to mention that some of these lessons, you have written down and put into book form. What led you into the path of writing and publishing? Tell us about what you've been sharing lately, book-side. I see a 2021 date on one of your books on Amazon, even. RYAN: Yeah. I was just writing notes and thoughts down, and I got to the point where there was enough of it where it seemed to be the construct for a book. That was the first book, The Founder's Manual, about providing some experiential exposure to things that I had seen work and not work. I said, “All right, there's no point in jotting these notes down over time if you're not going to do something about it.” So I then reached out to a publisher who had worked with somebody that I know, and I said, “Hey, I want to do this book.” They said, “Okay, we'll do it with you.” The first book is not a super long book. It's been relatively well-received. My publisher would like me to get better at selling books now than just writing books, so that's always an interesting conversation with them. [laughs] The second book was really the same thing. After I finished the first book, I started writing down notes about my experience as part of AWH the last 10 years. This was my first time owning and leading a professional services firm, so I learned a lot over the last 10 years. I saw some things work well that we tried, and I saw some things that were just abject failures that we tried. I've gotten to know people that also run and lead other professional services firms, and professional services firms are a tricky beast to make work. There's virtually no scalability. Your people are your product. You're selling time. To forecast where the business is going beyond like three months is almost nonexistent. And most services firms, because of a lot of the things I've just mentioned and more, have a really hard time growing and becoming what they want to become. One of the epiphanies that hit me was, it is really easy to start a services firm. All you have to do is say, “I've got a craft. I've got something that I can help people and companies with,” and you put up a site and boom, you're “in business,” so to speak. But the challenge is not starting a services firm; the challenge is, how do you grow a services firm? That's a very different animal than starting one. Super easy to start, very difficult to grow. ROB: I may have to pick up that. I can get the Kindle version. I have some credits I can use on the Kindle version of Sell Naked, and I might have to go grab this myself. What's maybe one of the key principles you'd pull out of that book as a teaser for folks who might be thinking about picking it up? RYAN: There's a couple that I would say. We titled it Sell Naked for a reason, because that's one of the chapters in the book, and the publisher felt like that was the lead chapter. The theory there is I see a lot of business development people for services firms, either leaders of or business development representatives at services firms, who sell with lots of propaganda, paraphernalia, and crutches. They've got these capabilities decks that are like 999 slides. They have these elaborate portfolios, etc. And in some services firms, I get it. Those make sense. But I think by and large, for a lot of services firms if not most, those things are just crutches because what those do is force people to focus on the tools and the propaganda and the paraphernalia rather than going in with a prospective client and sitting down and having a very open, authentic, transparent conversation about “What are you trying to accomplish? Are we a fit in any way to help you accomplish that? And if we are, now let's start peeling back the layers.” But if you go in with a capabilities deck and propaganda and all this other stuff, you're delaying getting to the crux of the matter while you pontificate about how awesome you are, and no prospective client cares about how awesome you are until they believe that you understand their problem and that you can share some insights and some value that might help them alleviate the pain of the problem. So I think people get selling services mostly wrong, I guess is the sum of that. ROB: That sounds very aligned. I can certainly understand especially how a peacocky sales culture and teams of very capable developers and designers – that's probably more oil and water than most organizations. But I think most people, outside of a very slick sales organization, appreciate that genuineness, that straightforwardness, building the connection and trust, more than building a shiny deck. RYAN: Yeah. I think the other thing we have figured out and that we do is we also don't do elaborate proposals. When a potential client says, “Yeah, we're interested in engaging with you,” then we send them – truly, and in the book I actually put some of the copy that we use, and the format – we send the client a bulleted list of the essential terms of engaging together. I call that estimating informally or proposing informally. The last sentence in that bulleted email is essentially, “If you're comfortable moving forward, let us know, and we will take this and wrap it in an SOW.” The reason we do the informal emails to engage is because there's no point in spending hours and hours and hours on an elaborate proposal when the prospective client is only interested in really two things at that point: how long and how much? If you've built enough value and enough credibility to that point, you don't need an elaborate, flowery proposal reiterating how special of a snowflake you are. Just get to the point and then engage formally by sending them an agreement to actually engage. Because if a prospective client responds to that informal proposal email saying, “I think we're good to move forward,” guess what? You just got a verbal that the deal is closed. But if you send a big, elaborate proposal asking people, “What do you think? Are we in alignment?” and all of these things, you're still trying to build value when that ship already sailed. Does that make sense? ROB: Oh yeah. They don't even know what they're saying yes to in a giant contract. They might float it over to procurement before they say yes to a dang thing in the enterprise context. There's a lot of hazards that just keeping it human – that makes complete sense to me. Ryan, when people want to connect with you and AWH, where should they go to find you and see more? RYAN: AWH.net is the easiest place because they can get to me from there and of course get to the rest of our team and the great work that our team does. That's probably the best place, and then jump off from there. ROB: Sounds perfect. Ryan, thank you so much. Congratulations to you and the team and what you're building together. We will look for more excellent digital products coming from you and the team for your clients down the line. RYAN: Thanks, man. Appreciate it. ROB: Be well. Thank you. Bye. Thank you for listening. The Marketing Agency Leadership Podcast is presented by Converge. Converge helps digital marketing agencies and brands automate their reporting so they can be more profitable, accurate, and responsive. To learn more about how Converge can automate your marketing reporting, email info@convergehq.com, or visit us on the web at convergehq.com.

Product descriptions may seem straightforward, but if done right they can significantly improve conversion rates. Today Jon explains why product descriptions are one of the most effective changes you can change to your website and how to write great product descriptions that will convert. The article Jon mentioned on how to write production descriptions that sell: https://thegood.com/insights/product-descriptions/ TRANSCRIPT: Announcer: You're listening to Drive and Convert, a podcast about helping online brands to build a better eCommerce growth engine, with Jon MacDonald and Ryan Garrow. Ryan: Jon, you recently wrote an article that kind of put my head in a spin around product description. Jon: Sometimes that's too easy. Ryan: I know. Spinning my brain's not necessarily the most difficult thing to do if you're in the space, but you wrote an article about product descriptions and how they can significantly improve conversion rates. And that surprises me because I personally ignore those all the time and I focus on other aspects of marketing and driving traffic as per usual. But that for me, is kind of like a side, just put it in there. As long as it's in there and then we can manipulate it going into Google shopping, where it's going to have an impact on your traffic. Just get something in there, period. Obviously I was wrong on this in my opinion. And I'm probably not alone in that. I'm excited today, Jon's going to school us on product descriptions and what you should be doing as an eCommerce business to leverage that to improve conversion rates. Jon, kick us off, explain at a high level, of all the things you could be focusing on on your site, why product descriptions in your mind, are one of the top things you can be doing to improve conversion rates? Jon: Yeah well, I think you basically just said it best in your tee up here where a lot of people just don't pay attention to this. And I think it's really, really forgotten. And that's a challenge in that as you're optimizing websites, it's one of the first places we go because most people forget about it. But look, we've learned over a decade of running AB tests on hundreds of product detail pages that optimizing your product descriptions is just one of the highest return, lowest investment improvements that an eCommerce manager can make. And look, they're key part of your potential customer's decision making process. I think the stat that my team here at The Good always says is that 87% of consumers rate product content extremely or very important to deciding to buy. Ryan: Wow. Jon: 87%. Ryan: Way higher than I would've thought. Jon: Right. Well, that's exactly the problem is most people don't think about this. And so if you're not optimizing product descriptions, you're certainly leaving money on the table. That's why you should focus on this. Ryan: If we're going to improve it, if we just assume that for example, my product descriptions are just terrible because I didn't focus on them, what are the areas I need to be looking at as I'm staring at my product description? And where do I start? I guess would be the best question. Jon: Well, I think there's four main areas that everyone should be focusing on and we can chat about today, but we can break these down. But the first is the real job of a product description. Most people think the real job of the product description is something that it's not. And we'll dive into that a little bit. The second is that it's an effective product description template needs to be used, so we can talk about what goes into those and what items you need to check the box to really make it great. And then how to write one that converts. It's not just having the content, you need to also be thinking about how you're writing that content. And then we can really talk about frequently asked questions around the product descriptions that I get, because I get a lot of questions about it. Once we start optimizing, people start thinking about it, a lot more questions come up than you might imagine. Partly, that's why we're doing the show today, it makes your head spin a little bit. That means there's a lot of questions there and you're not alone in that really. Maybe we can just break those four down and discuss each pretty briefly. Ryan: Yeah, I'm excited for it. What's the real job of a description of a product? In my mind, it's to describe the product. It's a blue t-shirt, congratulations. Jon: Yeah, right, exactly. If you just said blue t-shirt, how many sales do you think you're going to get? Let's just poke a hole in the idea that the job of the eCommerce product description is just to describe the product. I think that that's not right. Given the name, it makes sense that most folks think this, but product descriptions aren't there to just describe what's on your eCommerce site. They're also there to qualify. Do they help your visitors quickly assess, is this for someone like me? Do they persuade? Is it a compelling description? Is it customer centered on the reasons they should be considering that product? And then it's also there to surface. And what I mean by that is to help people find the product. This is the third one on purpose because a lot of people will stuff keywords throughout in terms of search engine optimization in optimizing the product description, but look, SEO keywords and search terms, and if you use those in a natural way, you'll get the page to show up and you want it to show up in search engine or even Amazon results if you're talking about optimizing your product descriptions on Amazon, which should also be done. Here's really one way to really think about this, product descriptions are a bit like your 24/7 in store retail associate for your online store. We often talk about if you wouldn't do something in a retail store, don't do it on your website. Let's take that analogy a step further and say, "How would associate talk about the product?" If you walked into a store and said, "Hey, I'm looking for a t-shirt," what questions are they going to ask to help you find the right one in that store? As a virtual retail associate, the product description can have that same kind of impact. And if it does its job well, it's going to draw visitors to your goods and then increase the conversions on those. And if it's done poorly, it's just going to frustrate visitors and push them away and hurt sales. It's very, very similar. Ryan: I like that. I think a lot of people, at least in what I think through is I don't think about qualifying. I'm like, you got to my page, you click on my products from Google shopping, you saw the price, just go buy it. And then if I'm in the jar looking at the label in the wrong way, from that perspective and I step out, I realize, okay, well I know conversion rates on shopping traffic is generally lower than category page traffic and so I'm like, oh well, possibly because my category is doing a better job describing a product or qualifying that person coming in and I'm just leaving that there rather than pulling it through and looking at qualifying them. Jon: Yeah. You're not alone on that. A lot of brands look at a category page as an opportunity to convert. I look at a category page as an opportunity to help somebody to the next step in the funnel, which is get them to that product detail page. And that's where you can really convert and sell and make sure people are getting the right product for them. Ryan: Okay, I concur. Tell us then okay, once I decide that it's more than just describing a product, what's a template look like that's going to help me through creating this product description that is going to be more than just describing my product? Jon: I love when I can change minds. And I'm glad we're helping do that today. All right. Ryan: We are. Jon: Again, here. Ryan: I'm taking notes. Jon: There are a handful of bullet points of things that you want to ensure are included. First of all, you need a descriptive headline. Use a product title that's going to hook your audience. Bonus points if you can connect with them emotionally. We don't want blue t-shirt, we want the t-shirt that makes your dad bod look hot. Ryan: I'm getting those ads on Instagram, by the way. I'm like, no, this is terrible. Jon: Ryan's looking good today in his shirt, by the way. All right. Benefits focused paragraphs. Use a descriptive paragraph to explain why, and I mean exactly why the customer benefits from the product. Too many people talk about features and that's it, they're just bullet point features and then don't talk about the benefits. You know how I led with the t-shirt that's going to make your dad bod look hot? That's what we want to be talking about here. What's the benefit? Not that it's a blue t-shirt. Yeah, that might be in there, but what's the benefit of wearing that t-shirt? The other thing we want to have in here is a key benefits list. Follow that description with a bulleted list of product features and benefits and this is where you can get into those details that if somebody is just skimming, they're going to look at that list. You're really what you're doing here is you're providing the benefits in a paragraph, maybe even telling a little bit of a story could be really helpful there. Don't make it too long. But then if somebody really wants, just give me the details. I already know I want a blue t-shirt, I just am deciding between two or three different ones and they want to know the specs and the features, that's where they're going to go is the bullet list. Don't bury those in the paragraph. The paragraph should be, hey, here's the benefits to you. If you want to know the features and the details, look at the bullet list that comes next. And then the fourth thing is, add some additional motivations. Really what we're trying to do here is just minimize those remaining purchase hurdles. Will it fit? Do others like it? Do things like credibility, social proof, you can bake in product reviews or even urgency. And of course, make sure you have a clear call to action. So many brands, we talk to have four buttons to add to cart and it's like, oh, you can use quad pay, after pay. You could use Amazon checkout. You could use both. And it's like, just give them one button and then push that to the next step. Get them to commit and then ask them how you want to pay. Ryan: Because my brain goes in funny directions when you say urgency, can you explain what that means from you, your perspective? Because it's probably not the little popup thing on Shopify that says, "Hey Bob in New York just bought this and Suzie in Florida just bought. Jon: You know me well. Ryan: Because I guarantee you don't like that one because I don't like that one. Jon: Yeah, nobody likes that. Ryan: And I don't have as many dislikes as you. Jon: I call that one of those wildfire apps and I call it wildfire because they just spread without anyone knowing how it started or why it's spreading. Ryan: Yeah, my competitor's probably doing it so I did it, and that's the worst way. Jon: And you don't see those apps as much anymore, a couple years ago, it was really popular and then everyone installed it and they realized this isn't doing anything. And also half of the companies using it are aligned about who's purchasing what, they all had Bob from Waco, Texas and it was kind of like you see Bob from Waco, Texas. Ryan: That guy shops on every site and I've been on. Jon: Exactly. And you're kind of like, that's the default it gives you. Here's the other thing. I really think what you need to be thinking about here in urgency is stock levels. And I'm not talking about lying. I'm saying, okay, only a few left. And what I mean by few? Well, I have two or three and you'd better buy it right away or it's going to go out of stock. There's some great tools, especially if you're on platforms like Shopify that are great apps that will do dynamic badging around quantity left so it can pull your quantities and do a dynamic image overlay on your product images. It will put a badge up in the corner that says, "Two left, one left," whatever. That's what I'm talking about with urgency. Or something like, hey free shipping. You're doing an offer, not a discount. When I talk about urgency, I'm not talking discounts as you know quite well. There could be some offers. It could be, right now it's a buy one, get a free gift. There's a whole litany of offers you can do that are not discounting and so I think when I'm talking about urgency, I'm talking about those type of items. Ryan: And so generally if you're a brand that has just tons of inventory, you have to focus more on getting creative and incentivizing without discounting to get that purchase from the product page. Jon: Right, exactly. Yeah. Yeah. Create urgency if it's necessary. The other thing we see perform really well in terms of urgency is if it's out of stock to sign up to get notified when it's in stock. We have a client we've worked with for years, that is a really well known Japanese outdoor brand, outdoor camping high end. And what we have done for them over the years is help refine their out of stock notifications. They have some products that never are in stock because as soon as they send out that out of stock notification, they burn through their stock again. And I'm not talking that they only get five or 10 in, no, they get thousands. But the thing about it is, is that consumers have all signed up for this list and they want these products. We say, "Hey, you want this product? Sign up to be notified." And then we send out on an email and that email goes out, "Back in stock, click here to buy it," adds it right to the cart and they're able to purchase. And then before it even ever hits the site and it changes the product detail pages show how much stock is left, it's gone within hours. Ryan: Geez. Yeah, I'm going to test pre-sale. I'm going to say, "Hey, this new blend from Joyful Dirt's coming out, we're going to start advertising it and pre-sell it on social so we can start demand, figuring what demand looks like, what our production runs need to look like." Jon: That's a great idea. Ryan: And hopefully there's a lot there, but if not, they were like, "Yeah, we're only going to produce a few hundred. We'll be fine." Okay, so what else do we need to be considering what's average eCom business owner not going to be thinking about that you know that they don't even know to ask? What don't I know that I should know. Jon: Well, I think there's some simple questions that need to be answered. Let's look at this as maybe I don't know, questions that somebody doing a natural deodorant product might have. You need to think about this, who's the customer? That's always the first one, who's the potential customer? When you're starting to write this, you need to be thinking about that first. Let's say here, it would be men and women who are fed up with chemical packed deodorants. Just being a normal deodorant and saying, "Hey, people who don't like to stink," that's not going to be good enough. What's your differentiating point? The second is, what problems does it solve? This is where you can get into it helps keep them stink free. The potential customer is not the problem, it's what pain are you solving for them that is a little bit deeper than the surface level? And then the problem it solves is really the high level okay, people buy deodorant for this main reason. But the differentiating point is what's going to define that potential customer. Then you get into what desires does it fulfill? For this theater and it would be something like feeling healthier, more responsible towards their bodies and the planet, maybe just feeling less dirty and smelly. They could be that generic. And maybe they've been fertilizing their garden all day with a Joyful Dirt and now they don't want to come back into the house and smell. And then you need to be thinking about what objections people have. And this is where it's like, hey, why are you using a natural deodorant? Or maybe other natural deodorants just don't seem to work or they lie about the ingredients. Those are all types of things you should really be thinking about there. The next question you really want to ask yourself is why you? Why your brand? Compared to the other guys, why does this deodorant actually work? And then last of all, definitely not least, but you really want to think about what words your consumers are using so you can mirror what they're looking for there. And this is great, this is where user research can really come in, just interviewing consumers, doing some user testing, for instance so when they talk about what words they use, things like natural, fresh, perhaps scent or confident, and those are words that you can bake into your product description. They're going to write it for you. And if you go and you answer all of these questions in an outline, kind of like I just did where I answered each question a little bit about deodorant, you'll have most of your product description written and then you can move on from there. Announcer: You're listening to Drive and Convert, the podcast focused on eCommerce growth. Your hosts are Jon MacDonald, founder of The Good, a conversion rate optimization agency that works with eCommerce brands to help convert more of their visitors into buyers, and Ryan Garrow of Logical Position, a digital marketing agency offering pay per click management, search engine optimization and website design services to brands of all sizes. If you find this podcast helpful, please help us out by leaving a review on Apple Podcasts and sharing it with a friend or colleague. Thank you. Ryan: I know though, pictures are worth more than words and so do you consider the images on the side of a product description as part of the description? Or is that different entirely? And that's a whole nother conversation around the images? Or do you use them together? Jon: I think it's a whole nother conversation, quite honestly. Although people say a picture's worth a thousand words, I think that's true. And that's why pictures, we should do a whole nother episode on that because I do think it matters. And I think that there's a lot of things out there that you could be doing. I think on model, off model, 360, in use, size comparison. You really got to be thinking about all the different types of images that you could be doing. And a lot of brands will focus on the words, because a lot of consumers will go to the words and with one good photo you can still get them to convert. But after that, you really need to dive in and start thinking about all the other photos that you could do. And that's a ripe opportunity for optimization as well for sure. Ryan: Got it. You've done a lot of obviously user testing and listen to a lot of people go through the process of buying, are there certain types of people that are only going to pay attention to image and some that only pay attention to the words and that's just is a personality or a person? Or is it everybody's taking all that information in together? Jon: I think that as humans we're visual, but there are some people who will, if you have a video, they're just going to watch the video and they're going to skim. This is really huge on B2B websites where you want to bake in video because what's going to happen, meaningful video, Telling you about the product and walking you through it, et cetera, because consumers are going to just scroll until they find video and then watch that video while they're doing something else like on a bus or in traffic or eating lunch. I just did that. I was evaluating some software for our business, for The Good, over lunch and I was eating lunch, watching product videos. I didn't want to read about it. I just wanted to sit there and watch the video. I just put it on one and a half speed and then go. And I think that's a lot of people will do that. And I think in terms of images, it's similar. A lot of people will get that content from the images, but they're not going to get all the features and benefits that way. They're really not. People still need the bullet point list to see all of the features. People who are going to be watching the video, looking at the images, that's where they're going to start and if you don't get it right there, they're not even going to go on to read the bullet list. It is important for a segment of the audience for sure. Ryan: I think of product descriptions kind of like I think of one on my website and I think of the one on the Amazon and I probably put more time into the Amazon one, but I have more volume on Amazon right now. And so, but Amazon has multiple areas for information. You get the top there's image and then a short description and then you go down and you have A plus content and the expanded descriptions. And now that I think about it, a lot of websites have that same type of feel built out around them. Are you seeing a lot of focus needing to be on the short snippet, kind of at the top, more than at the bottom? Because sometimes the descriptions I see, especially on B2B, all the spec tab that is really long and drawn out, you can tell people are just dumping information from an SEO perspective sometimes in there. Is there one area that's more important in all of that? Jon: Yes. I think in the concept of the description, this is what those towards the top of the page. Often you'll have images on the left and then all the product description content on the right. As you scroll down, you can take those bullet points we talked about earlier with the benefits and the specific features and that bullet list and break that down throughout the page. That's typically what I would recommend. Have the bullet point and if people want to dive into each one of those, so say you're talking about the deodorant as we talked about earlier and you want to look at the ingredients list. Well, you can say all natural ingredients as a bullet point. And then at the bottom you could start saying all natural ingredients and then you break out what those ingredients are and talk about the benefits of each and how it's truly all natural and it doesn't include, what is the big one? Aluminum or something that people don't like? I don't know. But I think, it's something like that where you would use the rest of the page to truly break it down. And that's where you can also inject some brand. And it's also where you should be injecting supporting content like blog articles. To me, too many brands put the blog on the homepage, so they have like this lineup of blog posts that nobody cares about on their homepage. The blog post is top of the funnel. It's great for getting people to your site. It's great for SEO for instance. But then if they're on product detail page and you send them back up the funnel, you need to make sure that it's done in a supporting fashion so that you're not just sending them right back to the top of the funnel for no good reason. What I mean by that is maybe you have a blog article all about those ingredients or a specific ingredient that you're using and you want to talk about why it's more superior and you need a 1,000 or 1,500 words. Well, that's not good for your product detail page, but it would be good to link to that and say, "Hey, want to learn more about this? Read this blog post about it." That's also going to help your SEO and Google find all of that content together. Ryan: Yeah, I think exactly zero times have I ever gone from a homepage trying to research a brand for a product and gone to the blog and be like, hmm, let me read some blogs. Jon: No, not going to happen. Ryan: Never happen. And I'm like, no, I'm here to buy a product or research the product, not read about how the product worked on X, Y, Z in these conditions. Jon: Yeah, but when you're on a product detail page and doing your research and you're far enough down that step, it might be relevant to some degree to know that it's there. Ryan: Awesome. No, obviously Jon you've broken down and torn apart a lot of product pages over your life. What are some of the questions that you've had clients ask you as they've gone through the process and tried to implement a lot of what you've talked about, even with your template? And are there any funny ones or when it makes sense that other people are probably going to be asking after they start doing this? Jon: Yeah. Yeah, you're right, I've probably broken down hundreds of thousands of these at this point. I don't know that might be exaggerating, but it is kind of like what's that movie with the kid where he's like, "I see dead people." That's me. I can't go down the internet and shop without seeing messed up product detail pages everywhere. It's just unfortunate side effect of my job. But I will say, I do love when we have a positive effect on those. And so I'm always happy to answer questions, but yeah, I do get some off the wall ones. I think the biggest one I get all the time is, can't I just copy my description from a competitor? It's working for them so why not? I hear that all the time. But I'm shocked I even have to answer this. But yeah, the short answer is no, you can't lift product descriptions from your competitors. Look, beyond the SEO challenges of that, meaning that it's going to be a challenge where Google sees the same as that content across two sites and then you're playing a really hard to win game because Google is going to pick one of them or when they do that, it's likely not going to be you because it knows that content has been on the other site longer and so that's what it considers the original source. Ryan: Now what about product descriptions from the supplier or the manufacturer? Especially if you've got a site with a 100,000 products on it. Jon: Well, you might want to evaluate why you have a site with a 100,000 products. Ryan: True. There's a lot of them out there. Jon: Yeah. I wonder how many of those are just dropped shipping, not doing that great. And that's why they're not doing that great. If you really want to be successful at something like that, you need to customize the heck out of it. And so you really do need to sit down and do this for all the products so it's not just the manufacturer description. Now you can base it on that manufacturer description, but don't copy and paste that because everyone else who's drop shipping that product is doing the same thing. Or on top of that, you're not really adding any additional value and I can promise you, most of those subscriptions are D level work. They're not even a passing grade in most cases. I think copying is a moral issue for me in addition to the SEO issue so it's two strikes you're out rule, really. Using the manufacturer, I think is the SEO role and ineffective. It's just a non-starter. Ryan: And I think that if you are in the eCommerce world and you are assuming something, you're going to lose. You never assume that this is working for a competitor because they're doing it and you think they're bigger than you. And you assume that somebody knows what they're doing. Obviously I have a wine and beer read business and you drink wine, if you read wine descriptions, those are generally written by somebody sitting at a desk at a winery that's coming up with weird terms. One of my friends owns a winery and I'm like, "Well, how'd you come up with your descriptions?" "Oh my wife and I started drinking wine and decided, let's start putting these things in there." You can't assume that, if it works it's on accident many times. Jon: I have a good friend who runs an agency that does nothing but branding and labels for wine and spirits brands and that is the number one challenge that they get from brands, their customers that they work with, is that those vineyards will send over the descriptions and they're like, this isn't going to fly, we got to help you optimize this. It's a challenge. It's not unique. They're like, you might as well just label it alcohol, alcohol from grapes. And that's always the joke. My friend is always just like, "You sent me this description. I'm just going to change it and say alcohol from grapes." Ryan: We're planting wine grapes right now. And I told my wife, it's like, "We're going to make some wine with it." She's like, "You think it's going to be good?" I'm like, "Probably not, but we're just going to call it Ryan's Yeast Juice. It's going to be great. It's going to sound like crap." Jon: When you gift me a bottle, I'll know. Ryan: Yeah, Ryan's Yeast Juice. That's actually why, I add grape juice with some yeast in it that sat in the bottle for too long, became alcoholic. Jon: Can't wait, can't wait. Ryan: I can't wait for my marketing to go, all the marketing energy I have, Ryan's Yeast Juice. I should probably trademark before it gets out. Jon: Yeah. Made with Ryan's fertilizer. How's that? Ryan: Yeah. Jon: Joyful Dirt line. Well yeah, I think the other question that I get a lot here is how long product descriptions should be. And I think it's not a one size fits all. It's long enough to be helpful, short enough to be digestible and depends on the product. A few quick sentences could work for your products or you may need to write 1,500 words, but I think it's something where you really need to understand your audience. Are they here quick? Are they deciding between a couple of things and want a feature list? Or should you put more effort into the story? Also, there's the brand aspect. There's a lot of brands who have a lot of fun with their product descriptions. And then there's a lot of brands who are just dry. That's just kind of their brand and you go from there. Ryan: Okay. Over the past, let's just keep it recent, three years, who would you say of companies you've at least seen their site, you don't have to work with them, probably did the best with their product descriptions? Jon: Yeah. Are you familiar with Chubbies? Ryan: I'm not. Jon: Ooh, okay. Chubbies is a men's, mostly men's clothing brand and they do some hilarious descriptions. They started out, I believe selling swim trunks. Ryan: Oh yeah. Yeah, now I remember. Jon: And it's now a bunch of other stuff, but they've always done some good work. I haven't looked at the site in a while, but they were pretty good one from back in the day. And I think, generally there's brands like OLIPOP and a few others like that who are new and are doing a really, really good job with it. I don't know if you've heard of OLIPOP. It's kind of like a new flavored seltzer brand. They do a really, really good job with it. I also think that there's a couple out there around more around eyeglasses, Felix Gray, things of that sort, that do a really, really good job. And I think that their biggest competitor is Warby Parker. And I think Warby Parker does a good job, but Felix Gray has really made their calling card being better content on the page. Ryan: Got it. Jon: The other one that I really like is Cards Against Humanity. I don't know if you've ever been to their site. Ryan: I love that game. It's the most inappropriate fairly game we've played with my in-laws. Jon: Okay, I was going to say, yeah, that could be awkward at best. Ryan: Oh it for sure is. Jon: They have a teenager version I've played with my cousins and I will tell you, that got awkward real quick too. But they have add on packs and all this other stuff and they do a great job with branding. And they have a couple of sentences, they'll say, "Hey, this is just," they'll be very quick. This is all about these topics. It's 300, but they'll inject some brand. They'll say, "All new absurd box contains 300 mind bending cards that came to us after taking peyote and wandering in the desert." And it's kind of like, that's funny and I know what I'm going to get is just weird random stuff. And then it's, they did in the bullet points. 300 brand new cards to mix into your game. This one's pretty weird. They're going to be weird, I get it. It's an expansion. It requires the main game. Now I'm like, okay, I get it. It's expansion pack. And you have nothing to lose, but your chains, I don't know what that even means, but that's what they're telling you. I think, it's on brand because it's super random. And I think that last bullet point is all meant to just demonstrate the randomness that you're going to get out of this pack. And then if you go down the page, they have a lot more info about and some samples and stuff, but that kind of gives you a good example there. Ryan: Thank you. That's awesome. Any parting words or places people need to be focusing and getting started on? Jon: Yeah, I think look, it's there's a simple formula that you can follow and too many brands don't even try to follow the formula. And if you go to The Good's website and on our insights or articles page, or just go to thegood.com/insights/product-descriptions, we have a really great article that breaks all of this down and more. Gives you ton of examples and it's a great way for you to just take the template we've got on there and start using that and applying it to your product descriptions and Ryan, it sounds like you may have some work to do, but it will get you a higher conversion. Ryan: I think I might. But thanks for the time, Jon. I appreciate it and educating me as always on how to make my site work better. Jon: All right. Well, I'm looking forward to seeing the results on that. Thanks for chatting today. Announcer: Thanks for listening to Drive and Convert, with Jon MacDonald and Ryan Garrow. To keep up to date with new episodes, you can subscribe at driveandconvert.com

Your Terminal Management System (TMS) handles all the data and business logic required to secure site access to load (or unload) vehicles. The TMS communicates directly with a wide array of physical devices from gate controls to preset batch controllers, with the latter automating and controlling product flow. It plays a large part in your midstream process management and business strategy, as well as how efficiently your operation functions. Effective TMS is measured by how quickly vehicles and vessels move in and out of the storage terminal facility. Also, how it's tracking both current inventory and the commercial transactions. Additional truck leads to increased revenue. Optimizing this process is one of the first steps when looking to reducing costs and improving profitability In this Optimizing Storage Terminal Capacity podcast series podcast, we are joined by Emerson midstream oil & gas expert, Ryan Thompson. Ryan highlights common challenges that terminal operators face, and how Emerson's TerminalManager is designed to address these challenges. Emerson's TerminalManager can help: Reduce truck turnaround times Implement faster queuing and truck tracking Track accurate delivery inventory and report distributions Ensure quality control impacted by blending ratios Support device compatibility Reduce human-error that comes with manual processes Visit the Optimize Terminal Capacity section on Emerson.com for on ways to maximize capacity yield and meet Top Quartile benchmarks through greater volume deployment, inventory turnover and revenue capture. It's time to put your TMS to work. We invite you to learn directly from our experts by tuning into other episodes in our Storage Terminal Capacity podcast series. Transcript Jim: Hi, everybody. I'm Jim Cahill. And welcome to another edition of our "Enabling Storage Terminal Capacity" podcast series. Today I'm joined by Ryan Thompson to discuss ways to achieve optimal truck and rail unloading rates to help improve operational capacity. Welcome, Ryan. Ryan: Thanks, Jim. Great to be here. Jim: Well, it's great having you here. Can you share with our listeners your educational background and path to where you are today as a senior manager in Emerson's Midstream Oil & Energy industry group? Ryan: Sure. I started out with a degree in petroleum engineering from Texas A&M University and took a bit of turn by getting into the IT consulting industry first with Accenture, and then later joined Deloitte Consulting. I made my way back into the oil and gas field in 2008, more specifically into Midstream, and I've been there ever since. I originally focused on pipelines and commercial applications, but now I put all of my energy into terminals and operations management. Jim: Well, that's great and that's a really interesting background with the IT consulting part in that, so that probably really helps as you work with terminal operators. So, can you tell us about a common challenge in the storage tanks and terminals industry today? Ryan: Yeah. A common challenge that I see is a constant push to do more with less. And what that translates to is improving profitability while at the same time reducing manpower, and this inherently leads us to process automation. And with a terminal management system, often called TMS for short, there are opportunities to impact both sides of that P&L equation. The very nature of a TMS system makes it both an interesting and critical piece of the solution. It's really where the rubber meets the road so to speak. The Emerson TMS called TerminalManager handles all of the data and business logic required to secure site access and handle loading and unloading activities. TerminalManager communicates directly with a wide array of physical devices, and that is from gate control to weigh scales, to preset batch controllers, with the ladder automating and controlling the product flow,

Traffic sources can come from a number of places, but for most companies the largest source is Google. And things can get confusing when it comes to organic traffic versus paid ads.There are a number of things that can affect organic traffic and paid traffic in Google, and it can get confusing quickly. Today Ryan clears things up and tells you what does and doesn't work in Google, and focuses on what you can do with on-site SEO to improve your organic rankings. The site mentioned for checking your organic rankings: www.semrush.com TRANSCRIPT: Announcer: You're listening to Drive and Convert, a podcast about helping online brands to build a better e-commerce growth engine with Jon McDonald and Ryan Garrow. Jon: Hey Ryan. So traffic to a website comes from many different channels and avenues, as we all know. And for most companies though, that largest source is always Google, the infamous Google traffic source. Now, from previous conversations with you, I know that Google shopping, spend and traffic can have a really positive impact on organic traffic in Google. Which always has blown my mind when I've heard that, because I heard from you recently too, that there are several types of search engine optimization that can have an impact on paid search. Not just on on-page. So this really confused me, because I thought Google kept everything separate. You can't spend money to grow rankings within Google. You can buy your spot with an ad, maybe do some stuff around shopping to get surface there. But I wasn't aware that those two really correlated with organic. So I'm looking forward to hearing about how search engine optimization can help your paid search. And I guess more simply, what are you talking about? Can you fill me in on this? Ryan: Yeah. So I don't want to confuse people kind of with the title or how we're putting this out there, but you can't spend money on paid search to have Google increase your rankings. That's been a myth disproved multiple times over, and Google has been very, I think, above board in how that works. But we do know that spending more on shopping, where people discover your product more, they will come back and buy through organic and direct, and those channels will start producing more revenue. But what people I think overlook are the fact that there are two types of SEO that people need to be aware of. And you should always as a business owner be investing or planning to invest in both SEO and paid search. I don't think one is greater than the other necessarily long-term, but you need to have both. And the type of SEO that people talk about or think about when they say SEO is what we've been doing generally for 20 years, building our rankings in authority with back links that are of high quality, putting content out on the internet that Google recognizes as valuable and they will give you more authority. You spend now on SEO with that's either your time or money, hiring people to do that. And then four to six months you see the results in increased traffic. That's generally what people think about with SEO. What they tend to overlook is the SEO that gets results actually within two weeks of you doing it. And that's the on-site SEO work. And so there's things you can do on your site to improve it that when Google re-indexes that you will move up in rankings. And this type of SEO will help organic traffic, but also have an oversized impact on paid search. And so because it dabbles both of those buckets I like to focus on that SEO before I even go to the SEO that people normally think about. And so on-site SEO at its simplest form is improving your category pages for Google. Jon: Okay. So you're talking content, better imagery, things of that sort? Ryan: Yeah. The content, the tags, the titles, things on that site that Google indexes and sees have a lot of benefits around your website and traffic generally. And so, if you do a search for your product, and so if you sell Nike shoes and that's the broad search that has lots of traffic, you will notice on Google most of the organic results are for categories of Nike shoes. It's not one specific Nike shoe like a shopping ad would be. Because Google, based on that search, knows that you don't know which specific model you're looking for or if you're looking for men's or women's. You're looking for Nike shoes. And so often the high volume terms are going to be category pages that Google is going to be indexing and sending traffic to until people get more and more specific with their searches. And that's how people generally move down a funnel, is I gradually do my research... Forgot, okay. Now I know I need to be searching for men's Nike shoes. Then I see that page. I'm like, "Oh, I need to be searching for men's Jordan Nike shoes." And then I'm like, "I really want to search for Jordan 4 men's shoes." And then that's when I'm getting to more and more specific and even adding color onto that, and people will do that through a search funnel. But the biggest advantage is saying, "All right, I have this category page and I need to have a description on that page about what's on that page that Google can see." And it doesn't necessarily matter for searchers because if I'm searching for Nike shoes and I'm on a page of Nike shoes, I can see they're Nike, I can see they're shoes. I don't need to read that text to see it. And so putting that on there though will have an outsized impact on quick increase in rankings. And so I like to start this by telling people to go to SEMrush, or some site like that to be able to see what is Google doing with your organic site, how are you average ranking on there? There's some wonderful reports on SEMrush. It's the one I use because it's probably simple enough that we to dive into very, very quick. I don't get super deep on a lot of my analysis. I get high-level and figure out some strategy and then move off of that. But SEMrush has some great things they've done from an organic perspective. They scraped these results pages, and they know generally where you're ranking. Obviously you rank in different parts of the country differently, and search intent and my previous search history is going to impact my organic results. But generally we know that hey, you're ranking here on this keyword. And SEMrush also brings in the average volume of searches a month. And so to start to see where your site could have a quick impact on this, you go to SEMrush, click on your organic rankings, sort it by volume. And you'll start seeing where your site is ranking. So if you're ranking on number 70 for a term with 10,000 searches, you're still getting zero traffic because you're stuck somewhere on page seven. But it'll also show you which page is ranking there. And when you see that you're like, "Oh, this page is ranking for that. And I'm seeing the term 'Nike shoes' goes to my Nike shoe page. That's great." You can click it actually in SEMrush and pull it up. Very simple. And you can see there's nothing on that page other than my title that says, "Nike shoes," in text that the search engine can scrape and understand. And so you take those category pages and you write that paragraph of text. You maybe make sure that your title is short and appropriate for that search. You make sure the H tags on the site are appropriate for that, and it's not including random other characters or doesn't have your brand first. It doesn't have sizes first maybe, if you're looking at shoes. That information on your site will raise the ranking within two weeks. And it really depends on your competitors on what they've done or what they're doing. But within two weeks, you can assume that you're going to have more value to Google. They're going to raise you up there. And that's by no means a bad thing when you're getting quick results on SEO. Jon: Yeah. So if you're looking at all of this and I'm hearing from you that okay, do onsite for sure. But how does this affect paid search? I understand that you can't buy your listings. You can buy optimization of these pages, which is search engine optimization, and that could help you. But how is this going to affect your paid search? To me, it doesn't feel like it would. So that's what was kind of shocking. So yeah. Tell me more about that. Ryan: For Google ads, if you're running text ads there's something that Google has called the Google quality score. That basically gives you three components. It says if you do well here, we're going to let you pay less than your competitors for the same search. So there's always a value having a higher quality score. It's one to 10 and there's three components. There's the expected click through rate. That's always relative to your competitors. And so somebody may come to me and think, "Well, I have a 7% click through rate. That's great. Right?" And I'm like, "No. There's no way of knowing that." It's based on your competitors and what are they getting. If Google knows that compared to your competitors you're getting a 7% click through rate on the same search term and they're getting a 10% click through rate, guess who Google wants coming up higher? Jon: Right. Just because it's more relevant to the searcher, and that's what they're understanding. And that's going to drive more money for Google in the end because more people will click on it. Ryan: Exactly. Jon: Okay. Yep. Ryan: Google makes decisions for themselves. They have shareholders, they need to make money, and that's fine. It's their platform. So the higher click-through rate is good. And then the ad relevance, so they're saying, "All right, does your ad have instances of the keyword that was searched in it?" We generally, horrible broad stroke, shoot for about three times in the ad, and the rest of the text in the ad doesn't have an oversized impact on the actual click rate. It's just you have it for Google, you're playing the game to get ranked higher. And then the other piece is the landing page and the quality of that landing page based on the search query. So Google can't see the actual image itself and decide is this image what they searched for. They can see the tags you put on the image, but the actual physical image AI is not actually determining is that actually what they searched for. And so that piece of content you're putting on your category or in Shopify, the collection page is telling Google what's on that page. And if you have that keyword in that content, Google is going to think this is a more relevant page to what they're searching and give you a benefit by lowering your cost per click through the increase of quality score. And it's a very easy thing to tie together and see the changes because quality score is reset every time somebody searches and every time your ad shows. And so if you make a change on the site to that description, today, and you see that I have a quality score of seven and you can break down the quality score components using columns in Google ads. And if you haven't done that before, you can get to all your keywords in the list in Google ads, that you're showing a text ad for, go to columns and ad quality score, and you can see, "All right, what's my click expect to click through rate, what's my ad relevance. And what's my landing page quality?" Jon: Okay. Ryan: And it'll tell you. You can either get below average, average above average. There's only three pieces to it. If you've got a lot of keywords, I like to push it down into an Excel pivot table. So I download it, put pivots on it- Jon: You love your pivot tables. Ryan: I love pivot tables. If you're running Google ads and you don't use pivot tables, you're wasting a lot of time. We still use Excel a lot in Google ads, but that can find really quick your below average landing page quality scores. And you can focus on those first, saying, "Okay, for whatever reason, this landing page, I'm getting dinged." And it's the largest component. It has about six of your 10 points associated with it. So moving from below average to above average can give you a significant boost and you're probably getting zero or very little traffic if you have a below average landing page score, Announcer: You're listening to Drive and Convert, the podcast focused on e-commerce growth. Your hosts are Jon MacDonald, founder of The Good, a conversion rate optimization agency that works with e-commerce brands to help convert more of their visitors into buyers, and Ryan Garrow of Logical Position, a digital marketing agency offering pay-per-click management, search engine optimization and website design services to brands of all sizes. If you find this podcast helpful, please help us out by leaving a review on Apple podcasts and sharing it with a friend or colleague. Thank you. Jon: Optimizing your site increases your quality score, which then helps you get more visitors and makes your ads more effective because it's going to be ranked higher in that list. So if you're on the search results page and there's three items, the one that comes first has the higher quality score. It's not just how much you bid, or is it how much you bid and the quality score? What other factors might come in there? Ryan: It's both. Jon: Okay. Ryan: Yeah. Google keeps a little bit of a black box in play. But they say it's the ad rank, which generally we know is the bid and the quality score going into play. And so the highest on the list is not always bidding the most. You could actually pay less per click and being ranked higher, generally. I guess it's not always the case, but generally the higher up you are in rank on that first page of Google, the more you're the more clicks you're going to get. The higher your click-through rate. And you obviously want more of the traffic if you're bidding on the keyword. And so improving the site experience for a Google perspective, and we're not talking about... Unfortunately sometimes for Google is not always best for the user. But you got to get the traffic to be able to determine if it's good for the user. So get the traffic from Google by increasing what Google thinks of the site. And often it's a pretty simple implementation to get this text on there. It's not tremendously complicated. I don't think you need to have a master's degree in onsite SEO to be able to do this. I've done it on a lot of my own sites and it's just having something there is better than nothing. And using general logic is saying, "Okay, I'm writing this for the search engines, not necessarily the user. So I want to make sure I have the right density." It's got to read in normal English because people are still going to see it, even if they're not reading it. But just get it on the site. And most small sites that don't have this are going to be on Shopify, just from a numbers perspective. We know they have over a million people using it. And so on Shopify this is the Collections page. And when you're putting that description in on your collections, in fact, I was just talking to a company that I'm helping advise in this area, and the business owner had all the descriptions already put on there, but they weren't showing on their Shopify site. Well that's interesting. And so we've dug into it and it's the theme. The Shopify theme she's using doesn't pull those descriptions in by default. And so some themes do it and some don't. So if you put it in there and your theme doesn't have that when you go to the collection page, you need to get a developer to force that theme to show it. And if you have a choice, put it below the product results on that category or collection page. If you don't have a choice, just get it on there. It's going to be fine. I haven't seen a meaningful increase or decrease yet on putting that continent in there on conversion rate. Jon: I was going to say, is there a... Thinking about my conversion rate hat, of course, as always, is there a better consumer experience when you think about that? Is having that content higher on the page, lower on the page near the products, things of that sort. Does that seem to matter? Ryan: I haven't seen it, but obviously I haven't done as much broad research on that. That's probably something in your bucket of skillset to look at that. And all right, on these Shopify sites where it defaults to above the fold or above the product results, do we see a change one way or the other when we move it below? My gut tells me I want to see the products first and most of the time when I go to a site, I'm not reading a bunch of texts when I'm searching for a product. I want to go right to the products and see which product makes sense based on the images I'm seeing and the titles of those products. But there probably needs to be some testing for most sites around that. But I would say if you don't have it there above or below, you're probably not getting very much traffic on it from a paid perspective. So you just need to get it, even if it's above the products, because now you don't even have- Jon: Done is better than perfect. Ryan: Yes. That's most of my method of business based on my business partners. We're just going to do it and we're going to make choices as we go, because if we're not moving forward, we're not going to make any decisions at all. Jon: And this is slightly unrelated, but I would say that a lot of our success at The Good has been purely because we just keep making decisions. And we know we're going to make bad ones along the way, but we're doing the best we can. You just keep moving forward, just keep taking those steps. And that, really, I think has been a competitive advantage. Or at least over just business in general, it's really helped us. And I think that's, that's a challenge I see. We talk a lot about all of these different optimizations you can do, and just getting it done, taking that step is 99% better than a lot of your competition. Ryan: For sure. Jon: A lot of them just aren't even taking the steps that we're talking about. So even if you don't take all of them, just take one. Like go to SEMrush today and look at these organic results and have a list of these opportunities and then fix them. And you're going to be 99% ahead, being armed with that data and having a good understanding of what to do next. And even if you're not running ads, because then when do run ads, you'll be well ahead of the game. Ryan: Yeah, exactly. I think it's always better to take two steps forward and one step back than it is to try to plan the best step perfectly the first time out. I know I'm going to make mistakes in business. That's fine. I don't care. As long as it's not a crippling business killing decision, I'm willing to make all of those. Jon: Which 99 out of a hundred couldn't be. They're small enough decisions that you just got to do it. And if you go to SEMrush and you follow their instructions or the recommendations, is there a chance that that kills your business? Unlikely. It's very unlikely. So what do you have to lose? You just got to put the time in and do it. Ryan: Exactly. And that's for most business owners, it's going to come down to a time-money thing. If you've got more time than money, which smaller businesses generally do, you're going to do some of this work yourself and figured out the hard way. If you've got a little more money than that, you're going to hire an agency to go do some of that work for you. And that's what I advise a lot of businesses to start. I was like, "Look, if you've not done this before, and you're really worried about making a bad mistake, hire an agency to do very small amounts." So you can see the model that they're using. And I even tell them, Logical Position for a thousand bucks, we will put six category pages together for you and do the work from the titles, descriptions, all that stuff. And you can then see, "Oh, that's actually not that complicated I see it where you put it in there, I see how it got on there. I see the keywords you used. Great. I can go build out the next 15 of these to help those all increase and then by that time, I might have enough money to pay for more paid search because I'm seeing organic traffic increase." Jon: This is why I tell people all the time when I send them to Logical Position, it pays to work with a partner that is large enough that they have an SEO focused team and a paid team because these things work together so well. And they need to be talking to each other. You can't just go off and do these SEO things and then not have your paid team aware of it. Because as we found out today, that's going to affect your quality score. And so not only could you get some increase in organic rankings pretty quickly by doing some basic SEO stuff, if you're not doing that, but then you can also do some off-site stuff that builds for a longer term. You were saying about four to six months, roughly. And then on top of that, you can be affecting your quality score. So what I've learned today is, okay, you still can't pay Google to list higher organically. Okay, that's a bummer, but I get it. I assumed that was the case. And so second, what I've learned is I need to get a better quality score if I'm ever going to run ads, because you need to make sure that quality score is high because I'm not going to pay a thousand bucks a click. But if I have a better quality score, I might pay a little less than that. Ryan: Some of your settings, you may get close. Jon: Let's just bury that one and keep it buried. Jon likes to waste money with his spend. But that's what I get for not talking to my friends before doing that. So look, I think there's a lot of great things here around things that every business of any size could be doing to really get more out of their paid media spend. Ryan: And just business in general, best practices, laying a solid foundation to build on for a brand. I think it's an easily overlooked one for a lot of brands that can have house sized impact for that time. I mean, writing a description might take you five minutes if you're the business owner and that five minutes could produce massive dividends on both SEO and paid search. Jon: On that, we'll leave it. It sounds like folks have some tasks to do that are pretty simple. Just need to put the time in to make it happen. Or if they don't have the time to give you a call and have your team at Logical Position make it happen for them. Ryan: Yeah. I'm looking forward to it. Let me know how I can help. Jon: All right, thank you there, Ryan. Appreciate it. Ryan: Thanks John. Announcer: Thanks for listening to Drive and Convert with Jon MacDonald and Ryan Garrow. To keep up to date with new episodes, you can subscribe at driveandconvert.com.

Larger companies get most of the press and excitement with their 6 and 7 figure marketing budgets, but the majority of clients we work with are smaller. And smaller companies have to do things a little differently than the big guys. What impact does a small budget have on driving traffic? How should small budget brands compete online? https://www.logicalposition.com/ TRANSCRIPT: Jon: Hey Ryan. So we get companies contacting us all the time, that don't have large, six or seven figure marketing budgets, and many times, those large clients get most of the press and excitement, but the majority of companies that end up investing in marketing are going to be smaller, and smaller companies have to do things a little bit differently. I want to ask you today, what impact does a small budget have on driving traffic and how do those small budget brands compete online? They obviously want to compete, they have to compete in order to grow, and I want to know what's the magic, how do they make that happen? I'm excited to talk to you about this today, and I guess I'll start pretty broad, in e-commerce, is there such a thing as too small of a budget? Ryan: Across the board as a broad general rule, no, but if you're really going to do something with your budget, then yes. I mean, you have to have enough budget to start moving things around and collecting data. And I think that initial starting budget, if you're a smaller business, is going to be important to determine how quick you can grow, how aggressive you can be, where are you going to find that opportunity to take the next step in the digital marketing evolution of your business? And I challenged a lot of business owners in this space, as I'm talking to smaller ones all the time. Like for example, yes, you can start with $100 a month budget, it's your money, and you can market it however you want, invest it however you want. But if you're e-commerce, you're e-commerce so that you can sell everywhere and have your online store open all the time, even when you're sleeping. And so if that's the case, $100 is not going to get you very far in marketing across the internet. And so if you're going to do something that small, you really need to be hyper, hyper, hyper-focused, which does limit your potential and opportunities to find little pockets where you can really dominate or win. And so I would generally say less than $1,000, there may be better places for your money than trying to drive traffic with it online. Jon: Interesting. I was going to ask, and maybe you've just answered, but I'd love your take on this too, if I only have $1,000 a month to spend, is it worth doing it or am I just throwing my money away, when we're talking about driving traffic through traditional paid media sense? Ryan: That's a difficult one because most business owners that are coming up with this $1,000 and you're smaller, that's a meaningful number to them probably, but they probably don't have the expertise to really make that $1,000 do as much as it can. And so you probably have to bring an expert in, and that costs money as well, because most people in the digital marketing world are not working for free. And so you have to figure in an expert generally, and I'll probably come back to that point, but for most businesses, I would say that you have to look at it through a lens of time and money. Jon: Okay. Ryan: Anybody can learn how to do digital marketing. You have to be able to study, you have to be able to go in and make some mistakes and learn it, but anybody can figure it out. It's definitely not the most complex thing you could be learning. But if you have more time, then you should be doing some of that work yourself and learning it and getting it to it like, "Can I get some basic things done?" If you have more money, than you need to hire people and your budget should probably be a little bit higher to be able to invest and push traffic. Jon: So we should be saying, when we say budget for today's conversation, should I be thinking about it as budget including the expert or budget just in what you would spend to drive traffic in these channels? Ryan: I think businesses should be looking at it together, but I think most business owners are thinking about, "Okay, I can spend $1,000 to drive traffic. Let's go put that on Google and make it work." I do believe though, the Googles in particular and I'll focus on Google for right now, but Google in particular has done some pretty cool things helping small e-commerce businesses get going. If you've got a feed and you're on a smaller platform, like if you're on Shopify, it's very, very simple to get up and running on Shopify and get your products going to Google. And then there's what Google is calling smart shopping campaigns that allow a business really to say, "Google, here's how much I'm willing to spend per day, and here's the goal I need to get out of it." It does not take an expert to get that up and running. And in fact, I tell companies, do not pay an agency to manage smart shopping campaigns because there's nothing to do. It can be a small piece of an overall structure, in fact, we at Logical Position do use smart campaigns in a small piece of a campaign occasionally, but we have to do a lot more work in the reporting and strategy on that type of client, to be able to justify charging management fees on smart campaigns. Jon: Okay. That makes sense. Ryan: Small budgets use more automation, I think, is the name of the game. Use things that are set up to make sure you don't just waste a bunch of money, and I think that's where a lot of small businesses, what keeps them from starting often is that fear of, "Oh my gosh, I'm going to go waste money trying to drive traffic because I don't know how to do it right." Doing some research, I think, can help keep that option to a minimum, that is just going to go out there and be a big waste. Jon: Let's say a company hasn't driven traffic on Google. How do they decide what that starting budget should be? Ryan: This generally comes down to, what's the business doing as a whole? If you're doing $100,000 a month on your website and you haven't been spending money, you probably have a larger amount you could start with then if I'm only doing $1,000 a month in sales. It's a threshold there of starting to look at it, but I generally say, in e-commerce, at least $1,000 to start with on Google. And then start thinking about it through a lens of, "I know I'm not going to be starting out at the gate if I'm doing it myself in a perfect world scenario." So there's going to be some learnings. I look at it through the lens of what's my light money on fire threshold, to let me get things going, and I've done this with new platforms on some of my brands. Nobody knew what they were doing yet, across the entire platform. Pinterest is being one of them. A couple years ago, it was just wide open. Nobody knew what it was going to do. I think they're getting some more structure in place and it's driving better traffic, but I went onto it saying, "Look, I don't know what it's going to do." My light money threshold at that point was, I think about 2,500 bucks, so I talked to Pinterest like, "Look, we can go a thousand a day for two and a half days if you want, or we can go $100 a day for about a month. I'm okay with either, whichever one you think is going to work better for me." And that was my light money on fire threshold, that I wasn't going to be mad, I was just like, "Yeah, that did suck, but I got some learnings." Pinterest didn't work for us at that point in time on that business, we'll continue to be revisiting it. But all that to come back around to it can't be a budget that if it doesn't work, it's going to tank your business, because there's a lot of unknowns if you haven't been on Google before, to how is your website going to convert, what traffic is going to work best for you. Because you'll take the same product with the same price for the same search query, going to two different sites and it's going to convert and there's going to be a different return on ad spend. And so with all of that unknown, anybody that tells you they know exactly what you're going to get by putting $1,000 out there, they're lying to you because there's no data to tell you one way or another. There's no way to know. Jon: Okay. So don't bet the farm. Ryan: Don't bet the farm, but it should probably make you a little uncomfortable. Jon: Okay. Ryan: When I'm looking at business decisions and I want to grow, and you know me, I tend to be on the aggressive side of things, I want what I'm risking to make me a little uncomfortable. I don't want it to be an easy decision or an easy thing to be like, "Okay." Could I have wasted $100 to test Pinterest? Yeah, but that was not an uncomfortable thing. 2,500 from me was a little bit uncomfortable. Partners and I talked through it and we're like, "Okay, if it returns nothing, that's not going to be great. But again, we're not going to lose the business because of a mistake if it doesn't work." So a little bit of uncomfort, I think, is good. Jon: Okay. So then let's say I have a thousand bucks, where do I start, Facebook, Google, something else? Ryan: I think generally it's going to come down to those two for most businesses to start off with. I think other platforms generally are younger and they are less proven and therefore generally higher up in the funnel. Like if you're going to jump right on TikTok or Snapchat for marketing and you haven't done Google or Facebook, I think it's going to be difficult to know if that platform is actually working for you, if you haven't gone to more advanced ones yet. And so when I talk to a business owner or a marketing team that's looking at deciding between both of those two to start, the easy way of looking at it as if there is existing market for your product, I generally say go to Google because you're going to capture people towards the bottom of the funnel as they're looking for your product. If you're creating a brand new category, there's not a lot of people searching for it on Google and so you're going to have to figure out how to create that and find the right audiences on Facebook and convince people to start trying you to build that search volume. So for example, last week I talked to a guy, his company makes edible bubbles and I'm like, "I have never heard of this before.'. Jon: Isn't that bubblegum? Ryan: Yeah. This is for kids going out and playing and blowing bubbles, he makes edible bubbles. And I had no idea my kids would want that until he sent me some samples and they're actually pretty cool. Jon: That's awesome. Ryan: But they actually make them for bars. Someday when we get to go back to a bar, they make these bubbles you can blow on top of a drink, and a lot of times they infuse them with smoke for presentations. Jon: That's cool. That's a great idea. Ryan: So really cool stuff, but there's not a target market yet that they know to search for that. So I, before last week, never would have even considered searching for the term edible bubble or edible bubble for a drink or bar drink presentation bubbles, that's just not even there. And so for that type of business, you've got to go on Facebook, you've got to target bartenders, you've got to target moms with kids, with the kid bubble one. And there's some really cool targeting on Facebook, and if you've got a good visual and some good offers, I think Facebook can work really well. For other businesses, Facebook generally will hit top of funnel like that, and so the return, again, generalizations, is going to be a little bit lower than if you had run some bottom funnel, Google stuff to figure out where people are searching for your product and what are your advantages and all of that. Jon: So we're talking the difference between perhaps intent versus awareness? Ryan: Yes. Like if there's already people searching with intent for your products or services, I would go capture them first. It's going to be a little more expensive per click, possibly, there's generally going to be more competition, but it's an existing demand that you're tapping into. You've just got to figure out how you're going to compete there. If you're creating a brand new product that nobody's ever searched before, you probably can't even spend your money on Google on search terms, you're going to be on broad match keywords on Google wasting money. Jon: Right. No, that definitely makes sense, then Announcer: You're listening to Drive and Convert, the podcast focused on e-commerce growth. Your hosts are Jon MacDonald, founder of The Good, a conversion rate optimization agency that works with e-commerce brands to help convert more of their visitors into buyers. Ryan Garrow, of Logical Position, the digital marketing agency offering pay-per-click management, search engine optimization and website design services, to brands of all sizes. If you find this podcast helpful, please help us out by leaving a review on Apple podcasts and sharing it with a friend or colleague. Thank you. Jon: What other things tactics do the smaller budgets need to be aware of? What else would you consider? Ryan: Some of the tactics I talked about when looking at smaller budgets on advertising and driving traffic, don't even have to do with the tactics to drive the traffic. A lot of small businesses, even over the last year with COVID and a lot of brick and mortar moving into online, a lot of them haven't thought about what is my advantage online? If you are selling the exact same product at the exact same price, and you have no discernible advantage over a competitor, what are you doing? Try to figure out, before you go spend money, why somebody is going to buy from you. And you can't really tell me that your advantage online is going to be because you have really smart salespeople inside, or you have a lot of knowledge in your industry, because that's not going to come across in Google shopping. Nobody cares how much you know, they don't know how much people know when they're just going to a website and transacting. And so you've got to figure out what that advantage looks like first. Why should somebody buy from you versus a competitor, if they've never met either one of you and all they're doing is seeing your website because the internet is the great equalizer and small companies can't compete with big companies, if they're better at certain things. Better at converting, if all of your competitors are stuck on really ancient Yahoo stores that are 20 years old, and you're going to come in there with a Shopify or a big commerce site, that's really easy to convert on. That can be a significant advantage, even if everything else is the same. Jon: It's funny, you say that, a friend and I were just talking about that and we were laughing, saying a great business model would be to just go to find a index of all the remaining Yahoo stores making over a million dollars a year and just replicate that on a better platform, with better usability and you would print money. Ryan: Why are we doing a podcast? Let's go get a list and start making business. But it's true. I think we still have 50 clients on Yahoo and some of them are, I think, are on the RTML, that really old coding platform, that if you're not 50, you've never even heard of that. And I only heard about it because we have clients on it. Jon: Yeah. Look, I mean, I think a lot of these stores take the approach of, if it's not broke, don't fix it. And they're still printing money, so why change it? I think they're going to ride that till the end. So somebody will come along and end them by doing something better, but you got to find it first. Talking about that is one of the things that the platform could be, one thing that these smaller companies are doing wrong. But thinking about smaller budgets, if they're sending traffic to their site, what do most of these smaller budgets do wrong? What mistakes are they making with their small budgets? Ryan: I think a lot of them, if they do have some advantages and they do have a reason to market, a lot of them make the mistake of not being aggressive enough. I think I've mentioned this probably multiple times, but a lot of small business owners really watch their P and L and all line items going in and out of the business, which is good. But when they come to Google ads, it can quickly become a very large line item and they want to focus on, hey, I need to increase profits, so we need to start cutting this budget and controlling Google, because if I control something in the middle of my P and L, the bottom gets bigger. And unfortunately, something like a Google ads or Facebook ad, is generally driving top line number that does translate into bottom line number, but if you eliminate what's driving that top line, it can really have an opposite effect of what you're intending. And so it's really a paradigm shift. If you're looking at your budget like a line item, you start looking at it as you're investing in getting new customers and then what are you going to do with it? Don't see Google ads or Facebook ads as a cost necessarily, unless you're purposely losing money and you have to control that piece, but that's a whole different story and most small businesses are not doing that, so I won't dive into that necessarily now. But then trying to figure out, okay, once you've got a customer, what are you going to do with them? Because Google and Facebook, they're a marketing channel and you're going to have to give some or all of that initial order margin to the platform to get the customer. And that allows you to compete and capture more market share, but if that margin is going to the platform, it's not going to you, the business owner or marketing teams future budgets. So you've got to do lifetime value, figure out what you're going to be doing to bring them back. So many times small businesses are thinking about, I've got to get customers, I've got to get customers, so I've got a market. Okay, good, you do have to do that, but you can't keep trying to do that without focusing on the customers you do have. What happened to the customers from last month, what are you doing with them? If you're not emailing them, if you don't have a loyalty program, you're essentially wasting all of this effort that you're doing to successfully bring new customers into the brand. And so that's where I see most struggles, because then they'll just be like, "Oh, Google was terrible. It took all my profit and then I had nothing." Jon: Well, we've talked about this several times on the show, of understanding that it's okay on that first sale to break even, and your customer acquisition costs might be high on that first sale, but you have to have a longer term game plan in place. Is it a subscription type product that you're going to use, if you have a consumable, is it something where you're able to continue to market to them afterwards, but you're doing it in a way that is going to continue to drive down the customer acquisition, but up the lifetime value over time? That definitely makes a lot of sense. So, okay, we've heard a lot of disadvantages to being small here today, but there's still a fact that most brands are going to be in that small budget. What are the advantages, what's the positive side, the glass half full here, what's the advantages to being smaller advertisers? Ryan: Yep. There's no secret that having more money can have more advantages in advertising, I mean, that's just basic marketing 101. But what I've seen through a lot of small businesses and having my own that compete against much larger brands, is you inherently have more flexibility. In fact, we were just laughing before we got on and started recording, about politics in larger companies, having all these things that you have to wade through to get things approved, or to do things, where you can't move quickly into new markets, because there's all these layers of approval. Small businesses, hopefully don't have that problem. And it's like, if you see an opportunity, you can just go do it and there's not a lot of people that have to sign off on. It's like, no, I'm going to go capitalize on that change in the market or that area that hasn't been attacked by larger brands. And so that can be a huge advantage, but I still think a lot of small businesses don't think of it that way and look at it, hey, I can afford to make mistakes and learn from them very, very quickly and pivot and adjust. And I can test new products on my site, I can test things on my site as a small business that I don't have to go to a web dev team. I can make quick little changes on my Shopify site to say, "Hey, let's see if this works or not. Let's run it for a week and if it doesn't work, flip it back." So much opportunity to test and so few small businesses actually taking advantage of that. I mean, I can't say the number of times that we've tested small things, even on Joyful Dirt, as we're moving very quickly and say, "Hey, let's test this or test this." That many of them work. I mean, we've got a really smart team that can come up with really cool ideas to test. For example, this month we did a black history month label, so we just, "Hey, let's just do a small run of a few hundred labels and see what happens." And larger brands can't in mid January, decide to do a label run for a specific event and try to get it to work. We're like, "Yeah, let's just see if it works. And so based on the success, we're going to do this multiple times throughout the year for different events and just have custom labels. Jon: That's a great idea. Ryan: Because we can. Jon: I believe this is called the innovator's dilemma. So when you're at a large corporation, you as an individual can come to the table and say, "I want to do custom labels for this month, starting in two weeks." But you have so much red tape to get through that you can actually affect the change that you want to affect. So that's a definite competitive advantage for a small brand, I can completely understand how that would work in their advantage. So that's great. Is there any other advantages that we should be thinking about? Ryan: I think being smaller also forces you to pay attention to details, that larger brands don't have to. We have a lot of large clients that focus on such macro level numbers, 35,000 foot layer of saying, "Hey, what's our data? How much should we spend? What is this?" And there's not the deep dive on, "Okay, how can I squeeze this little bit more out of this product?" It exists on a few large brands, but generally it doesn't matter to them on the small little minutia. And I think smaller brands, really have an opportunity because there is less data to sift through, they can quickly see where markets may be changing or evolving, that larger brands aren't going to catch till later. So you have to be willing to be aggressive and move quick when you see them, but you might see, even on Amazon, this is a massive thing with one of our clients where there's a couple really big players in vital wheat gluten, for example, on Amazon and the volume of sales on baking products on Amazon, is astronomical, I had zero clue until we started working with this company. Jon: Yeah, would not have suggested or thought that. Ryan: No, I'm like, "Vital wheat gluten," that's a very specific product for a very specific niche of people. Jon: Baking in general on Amazon, you would think there's no way. Ryan: It blew me away. But because the volume is so high, everybody selling FBA can only send in, because vital wheat gluten comes in, it's heavy and it comes in five pound bags or two pound bags, so it takes up enough shelf volume that you can't get 50,000 units in there at a time. And because you're usually co-packing, you're getting pallets delivered, and once it's down, you can't all of a sudden like, I'm just going to send 10 units today to take care of the sales. It's massive in and out of stocks all over the place. And so smaller advertisers could leverage that by saying, "All right, if I have my own fulfillment house, I can always keep a seller central product in stock on Amazon. Even if my FBA stock goes out," and you can play a lot of games and figure out what part of the country is or is not working. But that type of flexibility as a small brand, can pay huge dividends just by being aware of some of the struggles of your larger competitors. If your larger competitor has a disgusting amount of aging inventory, they've got problems probably floating the next purchase. Whereas you may not have that problem as a small advertiser, and you can even use drop shipping through one of the partners that could help you. So I think small companies have some significant advantages and I enjoy that part because it is more exciting to grow a smaller brand to take on a larger one. I do it myself, I add to this one. Jon: You'd love to take down the big guy. Ryan: IT do. Jon: Who doesn't? I mean, if you're in business, you're a competitor, just the way it is. Ryan: Oh yeah. And I love competing. And so it's fun as smaller business, but it does take a mentality that you are going to scrap and do everything you can to make it work. And when you come in with that mentality, I think it's very difficult to fail on Google ads or Facebook ads, because you're not accepting that it's not going to work. You see the data, you know people are spending money in your industry and they may not all be making money, but there's consistent effort there. And you just have to get to the point where you can wade through it and make it work because it will. Jon: Well on that note, any parting thoughts on this? I feel like I'm sufficiently equipped if I were a small brand advertising. You're giving me some renewed hope, that's for sure, that my $1,000 per day or per month, excuse me, would actually go someplace. Ryan: Yeah. The only thing I will say is that I do believe quality help will go a long way. You can be a small advertiser as a business owner and spend $1,000 if you learn and you're quick enough at adjusting and pivoting and looking at data, you're going to learn how to do it, but it might take you six, seven, eight months to get the point where you could have started at that point with an expert. And so it's at least worth interviewing a couple of agencies to see what it is they could do to help you if you bring experts on to manage that $1,000 spend. Yes, you're going to have to pay an agency extra cost, but can they get you moving towards your target at a quicker rate? I think often they can, but even if you're going to do it yourself, at least talk to somebody else that really knows what they're doing to see what the advantages could be. Jon: Well, and it could be huge too, if you get a higher return on that ad spend, that margin difference, they pay for themselves. It's like working with a great CPA, they're going to get you a bigger refund than if you did it yourself. So that covers their fees and hopefully more. Ryan: For sure. Jon: All right Ryan, well, thank you for your expertise on this. I know you guys work with thousands. Every time I talk to you, it's another thousand. So I'll just say thousands and thousands of clients at Logical Position, and a lot of those are smaller ones and you guys have learned a lot from that. So thank you for sharing all of the expertise you've learned. Ryan: Oh yeah. Thank you, Jon. I appreciate the time. Announcer: Thanks for listening to Drive and Convert, with Jon McDonald and Ryan Garrow. To keep up to date with new episodes, you can subscribe at driveandconvert.com.

In this episode Michael speaks with one of the new coaches from Roofstock Academy, Ryan Minekime about performing BRRRRs remotely.  --- Transcript    Michael: Hey, everybody, welcome to another episode of The Remote Real Estate Investor. I'm Michael Albaum, and today I'm joined by Coach Ryan Minekime, who's a Roofstock Academy coach with me over here at the Roofstock Academy. And we're going to be talking to Coach Ryan about what it means to be a BRRRR remote investor and how he got his start. So let's hop into it.   Awesome. Ryan, thanks so much for joining us today. Really, really appreciate you taking the time, man.   Ryan: Yeah, thanks for having me.   Michael: And so just in full disclosure, you are one of our newest rootstock Academy coaches. Right.   Ryan: Yeah. going on about three weeks now. It's been fun,   Michael: Awesome. And loving every minute of it. Right?   Ryan: Exactly.   Michael: Good deal. So I want to talk today to you about the BRRRR method. Since I know that's really a big part of your investment thesis and philosophy. But before we get into that, can you tell everybody listening at home a little bit about you as an individual, your background and how you got started investing in real estate?   Ryan: Sure. So I live up in the Bay Area right now. And I started investing in real estate in about 2014, I bought a single family house down in Downey, California as part of a partnership with my dad. That's kind of how I got into real estate in general, grew up watching him invest in real estate deals. So I bought that deal, and then invested in a multifamily deal in California. And then about two years ago started investing primarily in Indianapolis, using the birth strategy.   Michael: And I remember when we were first interviewing you to come on as a coach, I learned that your first investment down and down, he was about 20 minutes away from my very first investment property as well. pretty small world.   Ryan: Yeah, super small world.   Michael: So were you living down and down at the time you bought that first investment? Or was that a remote investment for you as well,   Ryan: I was living about 30 minutes south of Downey. And so my dad was actually managing a rental that he had, which happened to be the house that I grew up in, originally. And he noticed that the neighbor across the street was about to put up a for sale sign he had a conversation with him ended up getting the deal off market. And so we're able to cut out the agent fees for the seller, and it was a win win for both of us.   Michael: Awesome. And so it sounds like your dad then is pretty well versed in this space, if he was comfortable enough to get help you do a deal without an agent involved. Is that fair to say?   Ryan: Yeah, it is. And it helps that he already owns the exact same house across the street. So we knew all the comps on it. We knew the numbers when you would have been rent for so that made it a little bit easier going into it as well.   Michael: Awesome. And so how has that property been for you today? Just out of curiosity, do you still own it,   Ryan: Still own it still renting it? It was a California house in 2014. So it's gone up quite a bit since then it doesn't cashflow that much just given that houses are more expensive here, but it's appreciated quite a bit and planning on holding that as long as I can.   Michael: Awesome. So let's switch gears here and talk about the bur method. And just for anybody who might not be familiar, can you give us a definition of what the bur method is or what that acronym stands for?   Ryan: Yeah, so the BRRRR is heard all the time on bigger pockets. It's by rehab, rent refinance, repeat. And so that's what that stands for.   Michael: Awesome. And so walk us through your first bird deal and how you landed in Indianapolis. Yeah, so   Ryan: I actually started investing in Indianapolis, not using the bur method. So my first couple deals out there. I just bought off the MLS. And so I was buying with 20% down, and most of the ones I was buying, I was still throwing in rehab money into that. So it was 20% down and rehabbing it. I ended up putting a decent amount on each deal.   Michael: Ryan not to interrupt you. But I don't know if you've heard but there are no good deals on the MLS. So were you just buying all junk?   Ryan: Well, I did also this was two years ago. So it's a little bit before things got tough. But there are always still deals on the MLS, you just have to make enough offers. And ultimately you'll you'll find one that works.   Michael: That's a great nugget for anybody listening that thinks you cannot find any good deals on the MLS. It's a total numbers game. Awesome. Sorry to interrupt, keep going.   Ryan: And I'll come back to this but I actually still BRRRR off the MLS now. It's again, not easy these days, but still can be done. So after the first two deals, I ended up putting more cash than I wanted to into each of those then learned about the bird. Obviously, the scariest part about bur investing, at least for me at the time was throwing that much passion to a single deal.   So on the first one, I got a private money loan, and then went from there and purchased the house in cash and borrowed enough money to also have a little bit of rehab set aside to be able to do that, and put the rehab into it and then refinance out about six months later and was able to pull all but about $5,000 out of that deal. And I've been trying to just replicate that on every deal since then. So some of those are more successful, some are less successful, but my general approach is to try and replicate that strategy.   Michael: Right on and so in that first deal, you got your private Capital loan was that for the purchase and rehab or just for the rehab.   Ryan: So I've done it both ways. On the first one, it was for the purchase and the rehab. And I use a couple different private money investors, some are comfortable lending the rehab as well, some only want to do the purchase. So it kind of just depends on the private lender there as far as whether that's an all in loan or whether you're just getting a loan for a portion of them.   Michael: Okay. And I want to dig in a little bit more on kind of the numbers that we can't hear in a minute. But I first want to know, how did you land in Indianapolis?   Ryan: You know, it was just I knew a couple people that were already investing in Indianapolis, actually. So it's always easier to invest somewhere if you know someone that's doing it and success there. So that helps. I also looked at a general market factors you should always look at. So job growth, population growth, price to rent ratio, which is a came in handy for the bur method. And so just someplace that I could find an affordable house, and I could get the numbers to work. And so there's a couple of markets that hit that criteria. And then again, because I already had some friends that were investing there and set me up with the property manager, etc. It was made most sense to go into Indianapolis.   Michael: Awesome. And that was gonna be my next question is how did you start to build your team out there? But it sounds like you leverage existing relationships for friends that are already investing out there?   Ryan: A little bit. Yeah, I, I started out by just interviewing as many people as I could. So I joined and Indianapolis Facebook group, which was just a bunch of investors that all talk Indianapolis real estate all day long. They're surprisingly a lot out there that I invest in Indianapolis. So I started there got a couple recommendations, interviewed probably 10 to 15 property managers, which is which I, the team member that I started with, and then finally narrowed it down to three, one of those was a property manager that one of my friends was using. So it made sense to go with him, and then use him and then build out the team from there.   Michael: Awesome. And then Who was your next addition to the team?   Ryan: What actually all kind of fell into place with the property manager. So the property manager is a husband and wife combo, and the husband is my property manager, the white is my real estate agent. And so I guess they kind of sold me on that. But it's been been great ever since. And then from there, I started moving out a little bit, the property manager also does construction, which a lot of people have pros and cons about using your property manager to also be your general contractor and or due to construction. But so far it's worked out well. For me, another main contact I have out there. And a big part of my team is a wholesaler. And that wholesaler actually has a construction wing as well.   And so what I generally tend to do is depending on where I get that project, if I get it from my realtor, then I'll let them do the rehab. If I buy it from my wholesaler, I'll let them do the rehab to kind of keep the business within the family so to speak.   Michael: Sure. And you mentioned that some people have pros and cons associated with having your property manager do the construction. What are some of those?   Ryan: Yeah, I think the arguments against it would be that you just want aligned incentives. And so if your property manager is incentivized and making a commission on the rehab and or repairs that they're doing, you might think that they're incentivized to do to over repair your properties or to over rehab, your property's never going to bear commission. And so the way I got around, that was I just bid out the first couple projects. And so I got a bid from my property manager, and then took that bid elsewhere. And turns out he was either average or lower than average, as far as price and the quality seems to be there. And so once I gained this trust on that, then I just continue to go to end with every project from there.   Now, I think the the pros is just that it's one stream of communication. So when I buy a house, I send one email and they'll have a scope of work, then he'll flip it over to the property management side, get that going. And so it's just one point of contact that I have throughout the process, as opposed to trying to manage the GC and a property manager and keep everyone on the same page.   Michael: Now, it's such a good point, it's such a good point. And I love that you went and bid that out and really forced that trust to be there. And I mean, at the end of the day, even if they were a bit more expensive, that ease of communication that you just mentioned, very well might be worth it. So if you could go spend an extra 1000 $2,000 but not have to go chase down people to do stuff, that peace of mind is well worth it in my opinion.   Ryan: Yeah, absolutely. And I think sort of a side point of that is for example, I said if I buy through the wholesaler or let their construction wing do the rehab, when I bid them out, they've actually tended to be on the pricier side, but I've noticed the quality is higher, and they're always a faster turnaround, which at the end of the day if you're getting it rented but we faster than you would have otherwise, it's worth money. So it kind of just depends on comes down to the numbers at the end of the day and the relationship but I'm not necessarily always going with the cheapest option. Sometimes there's a faster option, sometimes better quality options. So it's just, it's good to have different options when you're going through those.   Michael: Absolutely. And I think that's such a great point. And I just want to reiterate and kind of dissect it for a minute when you talk about speed and timing of things. So there's holding costs associated with with owning these properties at while they're not rented. And so your tax payments, your insurance payment, your mortgage payment, if you have one doesn't go away, just because of the fact that there's no renter in there. And so you want to calculate all of that stuff, something that caught me a little off guard on my first rehab was the utility costs that you're going to be incurring while holding the property.   So there's people in there working using power tools using the bathroom. So a lot of times utility costs go through the roof during a rehab project, and you just want to be aware of that. And then also on timing, I've done this too, I've gone with the cheapest option, because it was the cheapest, and ended up taking months longer than expected, which then put us into winter, which then made it harder to get those units rented. So all of that needs to be factored in when you're making your ultimate decision.   Ryan: Yeah, absolutely. Timing is a big one that I learned about. In that if you're investing in places like Indianapolis that have winters with snow, which I wasn't used to being from California, it's really hard to get them rented and even to do the rehab if you're doing it in the middle of December, the middle of January. So definitely something to be cognizant of doesn't mean you can't do it. But it's just another factor to to weigh when you're thinking about it.   Michael: Absolutely. It's also depending on the extent of the rehab, if you've got to put on a new roof on this property, I mean, that often cannot be done in the winter, especially if there's glue or bonding materials that need a certain temperature to add here. It's just not an option. And so you might be sitting with a vacant property for a lot longer than you anticipated because of that timing issue.   Ryan: Yeah, absolutely.   Michael: Something else you mentioned that I really want to come back and touch on, which I think is just great is the combo husband and wife team that your property or your property manager and your agent, something I've touted for years and I talked to a lot of students in the academy about is anytime you can find somebody where your incentives are aligned, just like in this instance, you're going to be better off. And so this is not meant to knock agents or discredit agents in any way, but they get paid when they sell. That's just the fact of the matter. And property managers get paid when they manage.   So if you can find someone that has, you know, if an agent sells you a headache, and then skips town, you might never hear from them again, you know, they're gone. But if a property manager who's also an agent sells you something that's a bit of a lemon or a headache, they're gonna have to deal with that headache just as much as you are, if not more, so. So I think that was a great decision you made.   Ryan: Yeah, 100%. And another benefit I've noticed from that is, it's a little tricky when, because I'm buying from a wholesaler to the agent isn't always getting comped when I'm buying. And so for example, if I need comps run on a wholesale property, it's the agent isn't necessarily incentivized to help me with those comps, because of the fact they know I'm buying it off market. And so they're not going to get a cut of that. But what I've noticed in this relationship is because I'm buying that off market and bringing into the property managed by them, and then ultimately, I'm going to sell it through them. They don't necessarily care as much how I bring a property in just as long as I bring in properties in because they know I'm going to use them on the back end to sell out at some point in the future. And so it kind of helps out even the off market deals that they're not getting directly compensated on the first time around.   Michael: That's such a good point. That's such a good point. And are you able to negotiate any kind of discount? Or Yeah, reduction in transaction fees when you ultimately do sell? Because you're you're using so many of their services in house?     Ryan: You know, I haven't actually gotten to that point yet, because I haven't had to sell anything. And so I've kind of just been waiting until I have more properties under my belt to then have the economies of scale. So I'm sure I can have that conversation when I go to sell, but I haven't had that yet.   Michael: What about on the monthly management fee side or on the lease? You know, new tenant placement fee side? Are you able to get any kind of economies of scale? there?   Ryan: Yeah. So on the on the management fee, we negotiated basically a set discount based on the number of properties that I have. So starts at one rate, and then it tears down as I add more properties.   Michael: Great. It was that just a curiosity? Was that a difficult conversation to have or an uncomfortable conversation to have?   Ryan: No, not really it was? I mean, it wasn't difficult to have. It's a little bit hard when you're starting out at zero, because you're like, hey, when I grow to 50 properties, will you give me a discount? And I'm like, Okay, yeah, sure. But that's 10 years down the road, like,   Michael: Sure.   Ryan: let's talk when you're actually there. So part of it is theoretical at the beginning. But it's good to have a conversation upfront, just so you know what you're getting into?   Micheal: Yeah, I think that's a super good point. And I think it's also super important to recognize that once you hit 50 properties for the sake of discussion, right, changing property managers is gonna be a real pain in the neck at that point. And so having that conversation up front, make sure everyone's on the same page. I think it'd be really mutually beneficial.   Ryan: Yeah, absolutely.   Michael: That's a great point. All right. So can we dig into the numbers of your first bird deal? I'm curious to know about the purchase price, how much rehab you added, what it rented for and then I know you said you left everything but five grand in the deal. So what the refinance price To use look like?   Ryan: Sure. So my first one was this one was purchased through a wholesaler. So I purchased it for about 60,000 put $20,000 worth of rehab into it. So it was all in for 80. There's another call it 2500 and fees there. So my plan was around 85,000.   Michael: And does that 20,000 include your holding costs in terms of your principal and interest payments on that mortgage and insurance, all that good stuff?   Ryan: Yes, it does.   Michael: Okay, so you're all in for 87 five, and then you You said you refi it six months later,   Ryan: I actually rebuy I was able to refi in less than six months. So I was able to avoid the seasoning period. If it was a rate and term refinance. I mean, they're just paying off my private lender, they're able to skip the six month seasoning period. And so I refied it, I want to say about four months after purchase.   Michael: Okay. And then so they reified your $60,000 purchase mortgage.   Ryan: Yeah, so the refi came in, I took a loan out for the rehab on that one, too. So as 60, I had the loan out for all 85. And then when I went to get it appraised, the appraisal came in at 110. So I was able to borrow 75% of that, which is 82,000.   Michael: Oh, man, that's awesome. So that's a super interesting point. So if you do a rate and term only refi, you can get it done sooner, as then if you're pulling cash out,   Ryan: You can get done sooner, and you can still include the rehab in that first loan amount. And so it's still a rating term.   Michael: Right. Yeah. Because they don't care what's involved in that loan. They just see it's all one loan.   Ryan: Exactly.   Michael: Oh, man, this opens up so many opportunities. So go, you know, it's okay to go get expensive loans, because you can refinance out of them inside of six months, you just better be darn sure that your numbers are accurate. Exactly. Yep. Awesome. And so what loan product Did you get on the refi? out?   Ryan: So that was actually a traditional 30 year fixed. And now that was that was about a year and a half ago. So I think it was a, like a four and a half percent interest rate on a traditional 30 year fix.   Michael: Awesome. And you still have that today?   Ryan: I do. Yep.   Michael: And what does the property rent for?   Ryan: $1095.   Michael: Well, Ryan, you can't get 1% properties in Indianapolis man quick pull in our chain. What is it really rent for?   Ryan: 1095? It ended up working out well.   Michael: Awesome. So if you don't mind sharing, what is your average monthly cash flow looked like out of that property?   Ryan: With all repairs and maintenance, I'd say it's about 250 bucks.   Michael: Okay. 250 bucks. I'm just doing some quick math here. So 250 bucks, by a month by 12 months is about three grand a year in cash flow.   Ryan: Yep.   Michael: And your five grand into it? Ryan: Yeah, a little less than five grand.   Michael: So you're at a 60% cash on cash return?   Ryan: Yeah. cash on cash. It's a little weird when you're only investing like $3,000 in a deal.   Michael: Right? Right. Right. Well, it's it's amazing when I talk to you about BRRRRing. And they're able to either use a HELOC or get all of their money out of a deal. And so then the return becomes infinity because they're in it for $0 or even negative dollars. They got a tax free payday as a result of it.   Ryan: Yeah, exactly. Oh, man.   Michael: That's awesome. So the private lender that you use to fund that deal? Are they happy to do more deals with you? Because you were paying them interest the whole time? And now you've got them their money back inside of six months?   Ryan: Yeah. I mean, honestly, the only complaint I got was that it was within six months. It was free interest for not free interest, but he was getting the interest on it. And then he had to wait, click on another deal. So he would have just prefer that it took longer if that was the only complaint I got. But uh, but yeah, generally speaking, I have two private lenders that I use, and I pay somewhere between seven and 10% for those. And they're both more than willing to do as many deals as I can find up to a certain amount. Sure. And so I just keep going back to those two, to continually use them going forward.   Michael: Awesome, awesome. And you mentioned that some of your BRRRRs have gone just as well, if not better, and some maybe less. So what was an instance where something didn't go as well, and are able to put your finger on why it didn't go as well. And to kind of have some key takeaways from it.   Ryan: Yeah, I'll give an example of one that I'm in the middle of right now. I purchased one in probably September of last year, and I actually bought it off the MLS the numbers works, I thought when I purchased it, and so I purchased it for about 70,000 and the ARV was going to be close to 100. And so what are worked out I probably the math I was doing, I probably would have left about 15 grand in the deal all said and done after the rehab. But turns out the tenant just didn't want to move out. There was a tenant in there. And so now I've been sitting on that ever since with a tenant that's not paying.   So I'm paying the interest on it. The tenants sitting in there and actually as of this week, I think I'll be able to get them out. I ended up offering them cash for keys. I went back to a one time offer to cash for keys amount they said no and I just went Back again a second time offered a higher amount. And they said yes, but haven't moved out yet. So assuming they move out, the numbers should relatively work out. But I'll be carrying it for probably at least six months by the time the rehab is done and all the rents done.   Michael: Okay. And so how would you do that differently going forward.   Ryan: So since then, I've been trying not to just during the time of COVID, I've been trying to not buy deals with existing tenants in there, especially below market rate tenants. But if I had to do something differently on that deal, in particular, I probably would have offered the higher cash for keys up front, I was trying to kind of get cute with offering a lower amount. And they just said no, and that cost me probably three or four grands and unpaid rent during that time. And so I probably would have just bit the bullet and paid higher cash for keys up front. Again, this is all a little bit different during COVID versus non COVID. Right, probably kind of a mix of them and a non COVID time, but it is what it is.   Michael: Right. Right. And that's a kick you when you're already down, but you lost that three, four grand and rent and then all the whole carrying costs and time as well. So when you factor that all out,   Ryan: Yeah, thanks for reminding. You're absolutely right. Yeah,   Michael: That's a really good point. So only buying vacant properties. What about for buying tentative properties, and ensuring that they become vacant when you purchase them is that an option that you've played around with?   Ryan: That is an option. This one in particular, the reason I was able to get it below value is because they were selling as is. I threw out the option of trying to have a vacant at closing. But the seller rejected that. The seller also ensured me that the tenant was paying every month, which they probably weren't. But again, all learnings that went into that short, but yeah, if you're buying off the MLS, and it's not an as is purchase, typically you can put a clause in there that it's speaking at closing, which would have worked. This one in particular, I think the reason I got a good deal on it was because they didn't want to take that offer.   Michael: Yeah, that makes sense. And so is that the current project you're working on now? Or do you have anything else up in the air at the moment?   Ryan: Currently, so that one I'm trying to get the tenant out. And then another one I'm working on, I closed on Thursday, also invest as part of a partnership with two friends. And on that one, we close on Thursday, and then send it over to my property manager. He has a full statement of work by end of day Sunday, and we're taking off rehab today. So we'll get that one going.   Michael: Nice. That's super exciting. Can you give us the dirty details on that one?   Ryan: Yeah. So yeah, the newest one, also a BRRRR Indianapolis. So we bought it for 75,000. The initial rehab quote from the I bought this one from the same wholesaler, the initial rehab quote that they actually advertised was 25,000. But in looking through the pictures, it actually looked like it was in fairly good condition. And so I thought that there was a chance we could get it done for less than 25,000, the numbers still kind of made sense with the $25,000 rehab, they're just a lot slimmer.   So we move forward with the deal, I had my same property manager go and walk the property. And he said, we could probably get it done for under 15,000. So that alone saved the $10,000 on the numbers that I thought they were gonna be.   So we just got a full statement of work, like I said, from him on Sunday, came back at $10,000 plus some flooring costs. So we don't know those yet. But I'm assuming it's going to be within the $15,000 total budget. And so that'll mean we're all in for 90k plus about 5k. In closing and holding costs and 95k the ARV on that one, I'm pretty confident it's going to be about 130, which will mean that we can pull out 98,000 on that.   So if all goes according to plan on that one, we should be able to pull out all our money or potentially even pull out a couple of brands on top, that's also going to be given that it's only a 15k rehab. Now, the quote I got as far as turnaround was 15 to 20 days. So hopefully within 15 or 20 days, it'll be all rehabbing back on the market and getting it rented. We're going to try and list it around between 11 and 1200.   Michael: Awesome, man. That's killer. super exciting.   Ryan: Yeah.   Michael: We'll have to have you back on to hear how that one shakes out.   Ryan: Yeah. Luckily, there is no tenant in that one. So I don't have to worry about that on this one.   Michael: A little bit easier on this one.   Ryan: Yeah.   Michael: So are you able to get statement of work ahead of time during the closing process? are you closing so quickly that there's no time for that?   Ryan: So I usually have to give an answer back. Again, when I buy off the MLS. I do have time when I buy from the wholesaler I usually try to give an answer back within like two hours of when I get the initial email saying here's the deal, do you want it or not? And so because it's a two hour turnaround, I'm usually buying just off pictures that I got from the wholesaler which is generally speaking not recommended unless you've worked with that wholesaler a couple times. But because I have flown out to the novice, I met this whole They are a pretty good relationship with them. And so I've worked out a deal. And I trust them enough to that to where if I end up walking through the property afterwards, and it doesn't work, or it wasn't as advertised, I can back out of the deal on the phone to someone else.   And so typically, what I do is, I'll get it under contracts without actually seeing it, I'll just look at the pictures. And then once I have it under contracts, I'll schedule an inspection. And I'll have my property manager walk the property while the inspection is going on, so that not only can he hear what the inspector is saying and writing down the deal, but then he'll also give me sort of a soft float. And he'll say plus or minus, like $2,000, with the rehabs going to be. So we'll say, these are all the things I think you need to do, you should probably budget about 12k. And he'll give me that. And then once I close, then he'll go back, he'll send his full team out, and they'll give me a full detailed statement of work that says like, No, we need new baseboards mean nine sets of blinds we need, the kitchen sinks, not working, whatever the case may be, give me that full detailed statement of work after we close.   Michael: And do you find that the wholesalers estimates are fairly accurate or at least conservative. I mean, clearly, they were overly conservative here, which is something you tend to not hear about. Usually it's the other direction.   Ryan: Yeah, it's kind of all over the place, I would say, generally speaking, they're within 5k. And what it ends up being, but that's why you always need to get a second set of eyes before you actually close. Because it's tough to just take any one person's word for what that is. And wholesalers tend to get a bad rap AS FAR AS numbers, they're projecting etc. And so you just need to be careful and make sure that you have trust with that person as well as a second person or a second set of eyes, if you're not able to do it yourself walking through that property.     Michael: Makes total sense makes total sense. So when thinking about just getting started, and kind of turning back the clock, what would you know, today's Ryan, tell younger Ryan, as you're just getting started, or to new investors who are looking to do burrs remotely, what advice would you give to them?   Ryan: Yeah, I actually buying in the traditional manner of just 20% down and going through the process a couple times actually helped quite a bit. Financially speaking, it wasn't the most beneficial thing to do. But it just helped me learn the process enough to get comfortable with it.   Whereas if I tried to BRRRR my very first deal, it may or may not go as planned, but it's just, it was a bigger step. And so I feel like buying a traditional through the traditional method was sort of a baby step on the way to get there. And I think that actually helped me a lot. And so I would recommend getting one or two deals under your belt before going out and getting private money from someone else and then putting their money at risks on a deal.   The other thing I would say is, when I underwrite a deal, I'll try to my sort of threshold is if I can leave less than 15 days to deal, then I'll probably move forward with it. But there's always a chance that you could lose more than that or not be able to refinance out of that. And so just make sure you have enough reserves if you are taking private money to be able to cover that gap. So you're not stuck in an awkward position of not being able to pay that person back afterwards.   And then just to add on, I think one of the biggest things that's up in the air with bur investing is that appraisal piece. And that's one of the hardest pieces to get right. And so for example, on that first deal that I walked through that I ended up getting it appraised for one time, my first appraisal came back at $65,000,     Michael: After the rehab?   Ryan: After the rehab, and I saw that appraisal, and I'm like, Oh man, I just lost $50,000 Oh my god, you know what to do? And kind of in a weird way, COVID sort of happened that week. And so that lender froze all funds to the lender said, You know what, we're not going to charge you for the appraisal, but we won't lend you anymore. And so it was annoying at the time because I had to go find a new lender. But it all worked out well after that because I went to a new lender, and I researched a bunch of stuff on how things you can do to make an appraisal go more smoothly. use that for the second approach. gave the appraiser what I thought an estimated value was $110,000 and the appraisal happened to come in at exactly $110,000   Michael: Coincidence?     Ryan: Exactly.   Michael: So what are some of those things not to cut you off again?   Ryan: Yeah, no, I think the biggest thing there is just trying to make the appraisers job easier and coming up with realistic comps that you think are true comps. And so what I did was I sent a letter to the appraiser the day before they were supposed to walk the property with rental comps, comps that were pulled by my realtor. And then I put notes next to each of them like this one is a boarded up house shouldn't be used. And then I sort of use a weighted average of what I thought the right ARV was based on the comps that I saw.   The other thing I did was I gave a laundry list of projects that I did with the statement of work behind it on how much I spent on the rehab. So I could clearly show them that hey, I bought this for 60 but I also threw $20,000 into it. In the form of updates, so that they weren't just thinking that I bought a house for 60. And I'm trying to get it appraised for 110.   Michael: That's so good.   Ryan: So I think the combination of those two things has helped a lot. And I've done it for houses since then, including on my personal refinance that are going through right now. And it's seemed to work on all of those, as far as just getting that appraisal that is potentially a little bit higher, but hopefully just more accurate than what you would have gotten otherwise.   Michael: That's such a good point. And I think I've heard people say something, some similar tactics, but I don't know if I've ever heard that this specifically. And I think that's so great. I mean, just making it easy for that person to say yes, essentially, or to give you what what it is that you want. I love that man. That's that's great tip for everybody listening.   Ryan: Yeah, it's a lot harder to fight an appraisal after you get it than it is to sort of steer them in a in a direction that you would like beforehand. That has helped a lot over the course of past few houses   Michael: Love that. We're getting long in the tooth here, man, any final thoughts that you want to share with the listeners about BRRRR investing?   Ryan: From what I've learned, think the biggest thing is to get a team that you trust, which is true of all real estate investment types, but just get someone that you're going to be able to send out to a project and you're going to get numbers that you trust from them. And then if you're, if you're buying with all cash, or if you're trying to get under market deals, you just have to be ready to pull the trigger when the deal comes along. Like I mentioned, I'll generally try to do it within an hour or two of getting the deal from the wholesaler. So being able to pull the trigger quickly and let them know that you'll close on a repeated basis will end up having them send you more deals in the long run. So it's all about finding good deals and good under market deals. And so you just got to differentiate yourself to be able to come across those under marking deals.   Michael: And I think that's also a really great point of just being true to your word and being someone who can perform because I think people's reputations so often precede them, both positively and negatively, you know, yanking people along or just not executing on your word. I think that gets around and that can be really tough to come back from.   Ryan: Yep, absolutely.   Michael: Awesome. Ryan, thanks so much for hanging out with us, man. Really appreciate you giving us some insight into your world. And we'll be seeing you in the academy I'm sure.   Ryan: All right. Thanks, man.   Michael: Alrighty, everybody, that was our episode for today. A big thank you to Ryan, thanks for hanging out with you man. Always a pleasure when we get to shoot the breeze and talk real estate investing. If you'd liked that episode, please please please feel free to leave us a rating or review wherever it is you listen to your podcasts. And as always, if you have any suggestions for episode ideas or topics that you'd like to hear covered, leave us a note in the comment section. We look forward to seeing you on the next one. Happy investing

There are seven different types of people that you're going to find coming to your site. And if you can understand who these people are in each one of their buckets, you're going to be able to help each one of them convert because they're all going to look at your site a little bit differently. So how do we understand who they are? And what do we need want to know how do we convert these people? Jon's got the answers! TRANSCRIPT: Announcer: You're listening to Drive and Convert, a podcast about helping online brands to build a better e-commerce growth engine, with Jon MacDonald and Ryan Garrow. Ryan: Well, Jon, welcome to the Drive and Convert podcast. You've done a lot of writing, to say the least. You've got some phenomenal content out there on the internet and as somebody that reads most of your content and speaks to you often, it's always good to read. So if you're listening to this, go find Jon and all of his content on his website. I highly recommend it. You will come away as a smarter human. But one of the fascinating concepts that at least for me seems fairly unique to your brain and at least the content you're putting out is the idea of there are seven different types of people that you're going to find coming to your site. And if you can understand who these people are in each one of their buckets, you're going to be able to help each one of them convert because they're all going to look at your site a little bit differently or want to do slightly different things. But I guess step one is just, how do we understand who they are? And then we want to know how do we convert these people? We've got them to the site. We know who they are, now how do we convert them? So I'm excited to hear about this because I can never get enough insight into how to make my businesses and my clients' businesses work better. But can you kick us off just by telling us who are the seven personas that you're seeing on the internet coming to websites? Jon: Well, thank you, first of all, for the kind of compliments on the content. I'm blushing over here if you can't see that. Yes, there are seven and a lot of people think, seven that's a lot. But the reality here is there might be some overlap in these as well, right? And these are all different types of people that you really need to address on your site. And so many people don't do that, that it really led me to write this content. So the first set of folks coming to your site are what I call lookers, right? These are people who are just looking. They're browsers, if you will, right? They're not after any one thing in particular, they're having fun just looking around. They want to see what you offer that maybe will catch your attention. Honestly, they may even have been just searching around Google for different types of products and ended up at your site, not necessarily by mistake, but they ended up there and now they're just looking at what you have to offer. Really you just need to understand that not everybody who approaches your site's going to buy. Most e-comm sites know that, right? Because their conversion rate's not a hundred percent or else we wouldn't exist. But the reality here is that you still need to address this audience. A second one to be thinking about is bargain hunters. These are people who are only at your site because you're having a sale or some type of offer. Ryan: Hopefully, it's not a discount. Jon: Exactly. That would be my point of view. But that's what they're looking for there. They're trained, as we have said, several times, they're trained to look for that sale. And so there are people, and there is a segment of folks who will only buy if something's at a perceived bargain, right? And they really want to see if they can find the bargain. Sometimes it's the thrill of finding the bargain that really gets to them. The third you really want to think about it as the buyers. Now, it seems pretty obvious, but some people are really on a mission. They know exactly what they want and they're there to get it. So they searched for the model number, they found your site, and they are ready to buy. And so you really want to facilitate that. A fourth is researchers. Some folks are just researching. They have a general idea of what they're after, but they want to compare those options and the prices. So, a lot of people will go to Amazon for this, but now, a lot of people are doing that on brand sites as well. They go to Amazon and they find the product they want but then they end up on your brand site after they've done that research. They find the model number on Amazon, they Google it to find more details about the brand behind the product. Amazon isn't always the best at having product details, right? So a lot of times you'll end up on a brand site trying to do that and that's what these folks are. Ryan: Now, what would be the big differentiator on the researchers and the lookers? Because a lot of similarities between the two, but what would be the key differentiators in your mind? Jon: The key differentiator is the researcher knows what they want. They know what they're looking for. The lookers are ... It's kind of like wandering around a mall versus going right into the Apple store. You're at the mall but you beeline it for one shop because you know that you need something from that shop. Where you might just go to the mall to hang out, right? If that's even a thing, post-COVID one day, we'll see. Ryan: Someday we'll get back to a mall, maybe. Jon: New customers is another one. People don't really think about that often. And this is really where some visitors are just going to be new customers. They enjoyed their last visit. Maybe they were a looker on their last visit and now they're there to find out more and potentially become a new customer. Perhaps these are people who you should really be thinking about post-purchase, like they just purchased. What happens at that point, right? So these could be people who are buying from you the first time. And it's an audience you really need to be thinking about because you need to make them feel welcomed and appreciated. One that a lot of people don't think about is dissatisfied customers. Everybody has them. I don't care if your net promoter scores is perfect or you don't hear about these complaints. Everybody has a dissatisfied customer or more. And that's okay. These people are there for a number of reasons and it might not always be that bad. Maybe they're just dissatisfied because it didn't fit the way they thought it would, but they still like the product, they're there to return or exchange. For some reason, a previous purchase didn't suit them and now they want customer service. And the goal here is to make it easy for them to get that and perhaps even do self-service where possible. And the last one, seven of seven, we blew right through these, but we'll dive into each in a second, but this is loyal customers. So some of these are your best customers. They come back, they love shopping with you. They love your product and then they're going to be repeat customers. So, that's the seven. To run them real quick, it's lookers, bargain hunters, buyers, researchers, new customers, dissatisfied customers, and loyal customers. Ryan: Got it. So we know what personas people are in, generally. And then are there ways outside of the types of traffic that you help decide who this one is on the site to do that, or is it, I just want to make sure the site works for all of them? Jon: You really want to make sure the site works for all of them. And I think that there's many ways to group people into these different types. As I said earlier, they could be multiple types. But I heard you say the word persona, and I think I really want to make clear that it's easy to get dragged into things like personas, or where people are in the sales funnel, or warm, hot, and cold leads and visitors, or any of those things that can really just take you down the rabbit hole if you will, right? And I see this all the time where we ask people, who's your ideal customer, and they give us an avatar of somebody that has flowcharts, and photos of Charlie, the avid runner, and his demographics, and preferences, and what soda he drinks, or what bottled water he prefers, and all of that stuff doesn't really matter. It's never really put to good use, especially when it comes to optimizing a website, because that guy, Charlie, the runner, he was generated in the mind of the brand. He's not an actual consumer, right? So what you really want to do here is just keep it simple. Really you just want to focus on better serving each of these. And by doing that, you're likely to increase your conversions for each of these. Additionally, if you go any deeper than that, you're unlikely to get started because you'll end up in this, as I said earlier, rabbit hole of trying to figure out who Charlie is. Well, Charlie, isn't going to be all seven of these, right? So don't worry about Charlie and don't worry about going so deep. Ryan: Because you might have your ... If you've done the persona thing as a brand, you could have your same persona being all of these types. And so at the same time, keep this very top level when you're looking at your site and trying to guide traffic and just do what Jon says at the end of the day. Jon: If the world only worked that way. I'll have you call my wife after this and tell her that too. Ryan: Yeah, you do the same for me when we're talking about driving traffic. Okay. But we've got to tell people how do we take these groups of traffic and these people and get them to take the action we want them to take on the site. Because I'm guessing to a degree, not all of them are the same conversion either. Jon: Very accurate. That's true. Ryan: So we've got to think about that as well. Like a disgruntled customer is probably different than a looker at the end of the day, as far as action. So guide our listeners and viewers around what that looks like and how you're seeing converting those people. Jon: Well, let's break them down one by one, shall we? So start with lookers, really is what I would recommend here. And I think the thing to be thinking about here is with lookers is you're going to catch your attention and get them to stop that just shopping and not browsing long enough to consider some type of offer or something that gets their attention, right? So if you know your customers well enough, which most brands listening to this will, they'll know what will entice their customers. And I'm not just talking about an offer or a special or deal or anything of that sense, I'm also saying what's that one feature that makes you unique and makes you stand out? What's the benefit of the product that's really going to hit home for these people? They're at your site because they had a pain or a problem they're trying to solve. And they think your products can help them solve that problem. So you really want to make sure that you're putting that right upfront to get these people's attention early. But know also, it could take a few sales to get these people in there, right? So don't be discouraged when you see the bounce rate up there because people are just looking and leaving. That's what they do. That's why I call them lookers. Ryan: I hate when people talk to me about bounce rate. Take your bounce rate to the bank. Have them tell you what that's worth. Jon: Yeah, it doesn't help, right? Ryan: No. Jon: And it's a metric so many people chase, I think, thinking, oh, I can get my bounce rate down. Okay, this one goes in with time on-site with me as well. So many people track time on-site and I think it's a false metric because if you think about it, I'm there to get my tasks done. I'm there because I want to buy this product, or even if I'm just looking around, I generally have an idea of what I'm doing at your site. I might just still be browsing, but I have an idea of why I'm there. The problem with this is if I'm there for 10 minutes, you've made my life really complicated. I'm there because I need something, I'm looking around, and then the problem is I can't find that or I got sucked into something and I'm there for 10 minutes. As opposed to, I would much rather have customers who are at my site for three minutes and buy, right? And then I have their information. I can continue to market to them at another opportunity. But if somebody is spending 10, 20 minutes on your site, we probably have some type of usability problem. Ryan: Well, and also I laughed when you started talking about catching their attention because I know you're going to tell people it is not a pop-up telling them to join your email list for 10% off your first order, especially if you're a looker. Jon: Yep. I agree with that. Ryan: That is not going to be a quality email. Jon: Not at all. But you do want to encourage them to get on your mailing list but not through a discount, not through a pop-up, really encourage them in other ways so that you can then follow up with them later. Maybe that's something like an upcoming new release that they might be interested in, right? You should be thinking about it in that way. Once you've kind of got their attention, then how are you going to continue to keep that attention and continue to market to them? This is where I hear you say all the time, you're happy to pay for ads and break-even knowing you're building your customer roster. And I think that this is a good opportunity to be thinking about that without actually converting for a sale, right? This is what we would call a micro-conversion, where they're doing something that's not actually an exchange of money. Ryan: Now I would venture a guess and you can probably correct me if I'm wrong, but lookers probably make up the largest portion of traffic to most e-comm sites. Jon: Yes. There's a reason that I put them first on the list. It's because it's going to be the vast majority. Ryan: So it's a vast majority. You've worked with some pretty large brands with the ability to test measure lots of different things. Top of mind, obviously on the fly because we didn't talk about this beforehand, but what's a good implementation of this catch your attention that you've seen implemented that caused the brand to continue to be able to grow and push these lookers further down the funnel? Jon: Yeah. So this is where things like we were just looking at a company that sells a bunch of different pants. The price point was like $128 for a pair of pants. And I was like, man, that's, that's kind of expensive. I'm just looking at these pants. I don't really need a pair of pants right now. But the reality is what caught my attention was that they are five times stronger than jeans and I can do a lot of different activities in them. And that caught my attention because now I'm thinking, "Wow, they're going to last a lot longer than jeans and I probably spent $100 on a pair of jeans." So what's 28 more dollars to have them last five times as long as jeans, right? So just something like that, the benefit is really going to hit that. And I'm the target audience for that site I was looking at. So, these lookers, they're likely, the vast majority of them should be your target audience. If you're working with Ryan in Logical Position, then you're driving qualified traffic. And so assuming you're driving qualified traffic and these lookers end up there, they're going to be within your demographic of who is your ideal customer, so then really it's all about connecting with them on the benefit. Ryan: Got it. Okay. I think that's a great thing. It's easy to execute for most brands, I think. Jon: Yeah, for sure. So we can also talk about for each of these how I would recommend converting these. And I think for the lookers, I would want to really just make sure the e-commerce site is easy to navigate and search because really that's what they're here to do, is just walk around the store, right? So make it easy. Don't put barriers in their way, help them get where they want to go, and give them a really excellent reason to give them that email address that we talked about or other contact information, and so you can build a relationship with a nurturing campaign. That site I was just talking about, they had a bi-weekly $150 gift card that they would give to somebody who signed up. So you're entered to win a $150 gift card every other week, which is great because of $128 pair of jeans, I might get those for free. So if I'm seriously interested and I want to continue to stay in touch with this brand, I might've given them my email address there, right? And then another way really here is cart abandonment because a lot of lookers will add stuff to cart as a way of holding it to compare and look at when they're done browsing your store. It's kind of like if you go shopping and you might pick up a couple of different pairs of clothing or something off the rack when you're walking around the store because, "Oh, I like this. I might like it. Let me see what else they have too." And then you end up with three or four things, right? It's the same thing browsers are doing on your website. They're throwing it in their cart and then they want to just take a look at that and evaluate after. So having some type of cart abandonment there can be a great way to captivate their interest. Ryan: Awesome. Jon: So next would be bargain hunters. With bargain hunters, it's really not about discounting, right? That's not conversion optimization. I think you know my stance on discounting. People who listened to this show will know I'm fervent about not discounting, right? But instead, really look to offers like free shipping, or gift with purchase, BOGO. We did a whole episode on this. People really want to know the alternatives, they exist. And really here, you just want to be thinking about things like current offers on your website. Don't make your customer's desert at the checkout and then go elsewhere to find that bargain or that special code. If they have to go to any of those sites, they're not coming back. And so we really don't want to drive them there. And you might also highlight, last chance or clearance items instead of making shoppers really go find those on your site. It could be really good on every category to have a little tout or badge or flag on each product that says something about how it's last chance, or low inventory, or something that's on clearance. Ryan: Now, do you advocate for having a clearance or an outlet navigation button on brand sites for this type of thing? Jon: Generally not. Where I want to see that as within the category because, yes, having a clearance item ... A lot of brands will put that in the main navigation. The problem is you're wasting a really critical main navigation slot. You only want five to six navigation items to begin with. And if you're taking clearance as one of those or something of that sort, a sale, I see a lot of people have sale in main navigation, what's going to happen is people are going to go there first and they're not going to get a total view of your products. Usually, the products that are in that clearance are in clearance for a reason. They weren't really popular. So why do you want the first impression of what your product should be, for a person coming into your site to see, is only the products that other people normally wouldn't buy and they're on clearance, right? So instead, mix clearance in with your other products. That way you're not promoting only your worst sellers if you will. Ryan: A couple interesting points that deviate a little bit from what we're talking about, but it's applicable in that I can afford most things on the sites I go to, but I am cheap by default so I always go to the clearance button first. Because I'm like if I can find what I'm looking for on clearance first, I'm going to get it. Even though if I didn't see clearance, I would have gone to the product and probably bought a higher price one by default because that's just how I operate on a site. But also, when you are throwing discounted products on your site, and there's a clearance section that they are in, if your Google shopping is not set up properly, all of those products would have been going into the clearance section and you can be stuck in the clearance section of the site and you're going to be staying in there most of the time. And because products are discounted price, generally get to show more often in Google shopping because they're lower price point or there's a discounted price, you will, unfortunately, be sending a lot of discounted traffic to your site when that maybe is not the focus of your brand. So some brands I advocate for having an outlet site that's completely separate. Jon: That's a great point. Ryan: Kind of like Gap Outlet, their stores, they sell all their old stuff and they'll have a separate site, and then having the people going to gap.com on that. Jon: That's a great point. And that probably makes Kanye very happy as well. Next up is buyers. Buyers should be buying from you in a way that's hassle-free, right? These people want to buy. They're there to buy. They have a job. That's one job that they're there to do and that's to buy, so let them buy. Clear these obstacles, make it easy and simple to buy, really be thinking here about the bottlenecks in the path to purchase that people must take, right? What are the hurdles you're asking them to jump over? Let's get rid of those. A really great way to look at this is to do user testing, get people who fit your ideal customer profiles, and have them run through your site while you record it and talk about the challenges they're having. Again, the whole goal here is to get outside the jar, read the label from outside the jar. And it's really hard to do that when you're too close to it. So really be focusing on just eliminating every single possible barrier, too many fields on checkout, making people create an account before they buy, all of those things that would be extra steps or what we're looking to eliminate with these. Ryan: And be clear on your shipping rates. That's the one that makes me so mad lately, is people not telling me what I'm going to pay for shipping, so it'll increase your cart abandonment too. Jon: Yeah, Exactly. I mean, these people are ready to buy until they saw you were going to charge them 20 bucks to ship, right? And so, there you go. Perfect case study. Announcer: You're listening to Drive and Convert, a podcast focused on e-commerce growth. Your hosts are Jon MacDonald, founder of The Good, a conversion rate optimization agency that works with e-commerce brands to help convert more of their visitors into buyers, and Ryan Garrow of Logical Position, a digital marketing agency offering pay-per-click management, search engine optimization, and website design services to brands of all sizes. If you find this podcast helpful, please help us out by leaving a review on Apple Podcasts and sharing it with a friend or colleague. Thank you. Jon: All right. Should we move on to researchers? Ryan: Yes. Jon: Really, researchers, my point of view on these is these folks need to just make sure that they feel like they've considered their options and they're making the right decision. And your job, your only job is to help them do that. So what does this look like? Well, provide all the info you can think of, dimensions, instructions, details, data, data, data. That's what these people want, right? They're comparing. They came to your site because as I mentioned earlier, they were on Amazon, the Amazon didn't have the details, so they're relying on your site to have them. And you want to help them just make an informed decision. This could be everything from product reviews from other consumers to video. Researchers love video because they can see the products in motion and in use. Somebody even just holding the product and walking them through it. Specialized Bicycles does an amazing job of this. They actually have employees of Specialized, not models or anything else. It's employees hold the bike and then walk a consumer through it on video. And it's really, really well done. It does not have to be ... They shoot it in a studio, but it doesn't feel like it's a super well-polished and professional video on purpose, right? It's not some high production quality. You're aiming for your local news versus the national morning show, right, in level of quality here. Ryan: Got it. Jon: So the other thing is, really help these people understand things like sizing and photography. Video, I mentioned. So those are the things you just really want to help people dive into are all these different decision points. All right, new customers. These folks, they really want to feel like they've made a wise decision or that you want them to feel like they can make a wise decision, understand your warranties, helping people stand behind their products. You want to make sure that you're glad that they are your customer and make them know that. So this is where you think about retail source. Like your wife's retail store, right? She's there to answer questions. She can help out with returns. She'll generally just express gratitude when these people are shopping, right? It's hard to do that online, but this is where it becomes really, really important that you're doing things like building relationships with nurturing campaigns. And that can start with, as I mentioned earlier, a post-purchase campaign. What happens after this new customer becomes a new customer, right? They're no longer a visitor, they're now a customer. What do you need to do there? Loyalty campaigns, a huge way to engage these folks, right? You get them in and say, "Thank you so much for your first purchase. Here is points for your next purchase," or, "Two more purchases and your fourth one is free." Something of that sort, right? Where you're helping these loyal people become loyal customers. That's really what this is all about. Ryan: And these people just purchased, so maybe they haven't even gotten the product yet or maybe they just got it. Jon: Exactly. Ryan: Even just user videos on how to use the product you're getting can be valuable. I do that with Joyful Dirt. Jon: That's a great point, right? So what can you send as that follow-up email flow while the people are waiting for their package to make sure they know that you have their back, right? So if I bought Joyful Dirt, what do I need to prep for? Is there a season I should be doing this in? How much water do I need to apply? All these other types of things that I probably don't really think about, but are really key to somebody getting the most out of the product and buying again, right? If I follow your instructions for Joyful Dirt, I am more likely to have a good experience and then buy again, then if I just use the product without reading the instructions, which is more likely for me than not so. Ryan: What I appreciate on it too, on that first email after I purchase, usually the next day, it builds the anticipation because often I forget what I bought yesterday and I get surprised by Amazon in two days, who are the site I purchased it on. And so you're like, "Oh, yeah, I do have that coming in a day." I'm excited to get it now because I was excited yesterday when I bought it, and I forgot today, and then tomorrow when it arrives, I get excited. So it's a good way to continue that kind of that high from my purchase that I just paid. Jon: How is there not a phrase like the Amazon phenomenon or something, where everybody forgets what they ordered at Amazon at midnight the night before and then it shows up two days later and you're like, "Oh, yeah, I was looking for that. That was great. I'm a genius." Ryan: I know. I was like, well, I knew I wanted one of these and like, oh, I did want one and then I bought it. It was great. In college, it would have been, "Man, what did I do at 2:00 AM?" and talk about, "Oh, I had a bean burrito." Now, it's just transaction fatigue or something. And I'm just [crosstalk 00:25:48]. Jon: That was much lower key than I thought you were going there, Ryan. 2:00 AM in college. But this happened to me recently where I was working out with a trainer and we do an outdoor workout in my garage now. And it was really funny because he didn't bring his TRX bands. If you know about these TRX straps, they're a way to do workouts. And the reality is that I went on and I just ordered a pair from Amazon. I was like, "Well if you ever forget them again, I'll have some here." And totally forgot about it. And then the next workout came by and the Amazon guy literally showed up two days later while we were working out. So it had been like two days to the hour and the guy shows up and I'm like, "Oh, I wonder what that is." And you could read the outside of the box. It said TRX. And my trainer is like, "Did you get something from TRX?" I was like, "Oh, yeah. Last time you were here. Yeah, remember?" Yeah, so that's was pretty funny. I was like, Amazon wins again. Ryan: Yep. Jon: All right. Dissatisfied customers. We have two left. So let's talk about the dissatisfied customers. Everybody has them, right? And they exist. And that's okay. These folks often can just be made satisfied by helping them understand that you're trying to fix their challenge and improve the experience for everyone else. Often, it's like if I come across a problem on our website, okay, let's just say, I just bought a bed. I'm not going to name names, but I bought a bed online and it has a whole bunch of technology in it. Love it. But, I'm a tall gentleman, right? And I bought a king, and it comes, and I was like, "This is a lot smaller than a king." It turns out, I measured it, it's two inches less than a king. And I was like, that's really weird. It's not a queen. So what's going on here? And so I contacted the brand and said, "Hey, this bed is two inches smaller than a king." And they said, "Oh, yeah. Because of some of the technology, blah, blah, blah, we have to make it a little bit smaller." And I was like, "That would have been nice to have known up on your site. You need to tell people that it says king, but it's actually two inches smaller. Because you're advertising all these NBA players use this bed and things like that, and I'm thinking great, right? But then it's two inches smaller." And the founder actually emailed me and said, "Hey, I got this feedback. I heard this. Well, we're going to add this to the website and make sure people know." And I was like, okay, well, I still have the bed, now I'm satisfied. And I was like, at least other people won't have that problem, right>. So I felt vindicated in some way. And so I think I made this point to say that complaining customers are an excellent source of feedback. And that's how you need to look at these, right? It's not about just having dissatisfied customers, it's about understanding what their problems are and fixing them. They tell you what the problems with your website and your consumer experience are, and so you could fix those problems. So really just want to be quick to listen to things like bad reviews, understand the complaint before responding, and understand that you can turn dissatisfied customers into loyal ones. It is possible. Ryan: I think too often brands hear or get bad feedback or just dissatisfied customers, and it's just for them, it's almost scary confronting it, or they're really excited and passionate about their brand, and somebody doesn't like it, they're like, "They just don't know what they're doing." I've done this myself with brands, and I'm like, "They just don't know what they're doing." And then I'm like, okay, it happened again. I'm like, okay, fine, we need to adjust the product. And my baby may be ugly, so let's fix it and not make it so ugly to some of these people. You can't be scared of dissatisfied customers, or you're going to lose your brand. At the end of the day, it's going to be just terrible. Jon: That's a good point. Yeah. All right. Last one, loyal customers. So, look, the 80/20 rule says that 20% of your customers will be responsible for 80% of your business. So the way I like to look at this and it's hilarious, I was just saying this to somebody else, but loyal customers are your bread and the rest are your butter, right? So really want to be thinking about what are you doing for these loyal people? So look at loyalty programs. I like to use airlines as examples because they are so good at gamifying, right? I'm platinum on Delta. I mean, I haven't flown them in nine months and I just got another letter from them yesterday with baggage tags for platinum level. And they said, "Hey, we're going to keep you a platinum level for another year. Don't worry about it. All the miles you've accumulated will count towards next year. So you don't have to start over. We understand." And they're gamifying it and in a way that's, okay, now, next year, when I start flying again or whenever that is, I'm going to go right back to Delta because I'm still platinum there. If they had removed, I'd just figure out, I'd be like, hey, well maybe Alaska or whoever else flies more on the West Coast where I'm all the time going, I would probably switch. But now I'll stick with Delta, right? They've done a great job with that through what's no doubt a challenging time for them. So really want to be thinking about a way to keep customers coming back and how you can take care of your most loyal customers. As I say, gamifying works very, very well. Every customer is special, but you really want to treat these folks with even more kid gloves, if you will. And then find ways to reward and recognize these people, you can give them special amenities. Baggage tags aren't really going to be much for me. I don't really care about that, but I'll take the free upgrades and the free alcohol and everything else that comes with being platinum with Delta. And then really just treat them like a VIP and they'll continue to be loyal. That's really my key point here. Ryan: And this is really probably the one area that I advocate for companies looking at competitors and taking note because a lot of times when you look at competitors and they have this widget on their side, or they do this thing in their ads, they probably have no idea what they're doing. At the end of the day, they're testing something. But when it comes to loyalty and what they're doing with their customers to try to keep them loyal, often, this is where a lot of research goes and especially in the airlines. If I was running an airline, I would go to all of the other airlines' loyalty program, find a list somehow and say, "Look, if you are platinum with Delta, I will automatically make you platinum or whatever my highest thing is with Alaska, give me a shot." And just automatically, because you're losing nothing. I'm not getting Jon's business right now. Jon: Right. It's funny you say that because Alaska does just that. They'll do a status match, where if you're platinum on Delta, they will status match you and give you that for a year on Alaska. Sadly, you can only do it once in your lifetime. And I did it right before the pandemic, so that's not a good situation for me. But yeah, at any rate [crosstalk] travel. Ryan: Join your competitor's loyalty program. I highly recommend everybody do that because it's going to give you some ideas of what they're seeing in the data or how they're gamifying it. Just jog your brainstorming ideas. Jon: Yeah. Status matches is a great idea, right? That's wonderful. Yeah. Where do you think you want to go from here? Ryan: Well, we're about out of time. So, I guess, I've got a lot to chew on too because I'm sure we're going to come out with some other ideas on this after digesting most of your data. But there's a lot of things you can do on a site to target a lot of people. And so what would your suggestion be to somebody that's just taken this fire hose to the face for their site and they're like, oh, my gosh, seven different groups of people? Where do you start and how do you start taking some actions so you're not a paralysis-analysis scenario? Jon: Yeah, great point. I would say here, start by asking questions about each of these groups and taking a good look at your site from their perspectives, right? So do each of these customer types get their needs met or are you just leaving some out in the cold? And how do you identify and engage the most loyal customers, or how do you flag and recognize new customers? And are you providing enough information to researchers? So really there's a key question in each of these if you go down and just ask yourself, am I meeting the needs of these people? And you'll come up with tons and tons of optimizations that you can do to your site on your own pretty easily. Ryan: Got it. And I would probably just broad stroke saying if you move up through the list in reverse order, you're taking care of some of the easiest or most important things. Like keeping your loyal customers loyal to you, you can't lose lifetime value customers, otherwise, your top-funnel marketing is just wasted. So keep those and move up. If you have to make a choice on where you're taking actions, I'm guessing that's where I would start. Jon: There you go. Awesome. Well, thank you, Ryan. I really enjoyed the conversation today. Ryan: Yeah. Thank you. Thanks for bringing your brain and letting me pick it and add some value to our listeners. I appreciate that. Jon: All right. Well, have a great afternoon. Ryan: You too. Thanks, Jon. Announcer: Thanks for listening to Drive and Convert with Jon MacDonald and Ryan Garrow. To keep up to date with new episodes, you can subscribe at driveandconvert.com.

Psychology plays an important part in business no matter what business you’re in or how you’re getting sales. The best tactics to convince us to spend money are the ones we’re not aware of. Retail stores have been using music, scents, and merchandising to get us to spend more money for decades if not centuries. Those tactics online now have a name and its Dark Patterns. Jon explain just what Dark Patterns are and why your brand should avoid using them. Read more about Dark Patterns: https://thegood.com/insights/dark-pattern-ecommerce-ux-design/ Transcription: Ryan: Jon, psychology plays an important part in business, no matter what business you're in and how you're getting the sales. Now, the best tactics to convince us to spend money are the ones we're not really aware of. And retail has been doing this probably for hundreds of years, even though I haven't been involved in it, using music's sense merchandising of how they put products on the shelves to get us to spend more money. And all of that research and data is out there for the taking, but I would venture a guess that most of the public is unaware of actually what's happening in those retail environments to commit us to spend money. When it comes to e-Commerce though, and the way our economy is moving to transacting online, I'm finding a lot of these "psychology tactics" are much more in your face, or at least I'm more aware of them. And maybe it's because I'm spending too much time in front of my computer talking to e-Commerce business owners and looking at e-Commerce sites. But I see it all the time, and a lot of times it just bugs me and you have a term for it called dark patterns. And that's a new term to me, but probably not to you because you work in the CRO world, but you recently mentioned it on LinkedIn. And I wanted to learn more about it because it fascinates me, the intricacies of psychology because studying sales my whole life and now having a retail store with my wife, it's just always there. And I think most of them I see online are garbage, some plugins on Shopify sites that maybe should never have been put on in the first place, but I want to learn about dark patterns. And I learned from one of the best in the world, who should be you. Jon: Awesome. Ryan: It sounds evil, but I just want to know more. How do we use our powers for good? Jon: I'm looking forward to it. Ryan: Jon, why don't you just take a moment and give me a high level of what do you mean when you say dark patterns when it comes to e-Commerce and e-Commerce sites? Jon: So when I talk about dark patterns, what I'm talking about is similar to, if you think about hacking and in a way that there's white hat and black hat, right. And black hat hacking is when you're doing something intentionally for a negative outcome, it might be a benefit to somebody like it's going to be benefits to the hacker, but you're hurting somebody in that process or you're creating a problem in that process. Where a white hat hacker is really just trying to help. They're trying to do things for positive. Maybe they're looking for bugs, but they're going to report them to the software maker before they do anything to exploit it. So you think about that. Exploitation is really what comes in here to my head when I think about this more than anything else. So, what we're talking about here today is really when an e-Commerce store makes something difficult because they want to influence the outcome that they're trying to do. So whether that's something through psychology, you talked about in a retail environment, the type of music they play in the background that calms people down, or how they price, where they make things $2 and 99 cents instead of $3, right? You start thinking about all these psychology tricks that come at play well in e-Commerce there's all those psychology tricks. Plus there are ways to actually increase barriers intentionally on a website so that the consumer can't take the action that they're trying to take, instead, you've made it more difficult. Some examples of this really easy one, an email pop-up pops up when you come to the site to sign up for email lists and there's no way to close it. So the only way you can get back to what you were trying to do is to give them your email address, or I like to call this negative intent shaming. So where the button in that pop-up says something like, no, I don't like discounts or I don't like saving money, right? There's all these types of dark patterns. And it can go even more, really sinister and you make it just impossible to unsubscribe without calling, right? So for years, and it may still be this way, but Skype was an amazing case study of this, where they would claim massive retention rates, but their user rate was super low and usage. And the only reason they had retention rates that were so impressive is because the only way to actually cancel and delete your Skype account was to call a phone number in the U.S. So, if you're an international user where Skype was way more prevalent than in the States, you had to call international, talk to somebody in English only, and say, I need to cancel my Skype account. Please delete it from your servers. Why won't you just do that when a click of a button? So this is a good example of a dark pattern where the brand really valued retention, so they made it near impossible, right up, maybe to that legal limit. And one of the things you saw on LinkedIn was I had posted to an article it had run in what's called The Hustle, which is a great entrepreneur email. If you're no signed up for a free email, it comes out every morning, just around entrepreneurship and the tech industry and whatnot. And they were saying that there's new legislation coming in that is all about making these dark patterns illegal. And that most things need to be self-service, and it shouldn't be a challenge. So that's really where I was going with this was not only is this just bad to do and lead to a horrible brand image in the longterm, but it's also going to become illegal fairly soon. And I hope it's sooner than later, I have my doubts that would happen anytime in the near future, but I hope it's sooner than later. Ryan: So could you also bundle in to that broad, I guess I would probably try to broaden dark patterns a little bit and say it also includes what people think is helping from a psychological perspective, but it's actually just stupid. Well, one of my, I guess, favorite, least favorite was the one that I noticed the most is there's a plug-in on a lot of sites that says, Oh, little Jimmy just bought the pink t-shirt and Oh, look over here, Susie just bought this vase. And Oh, people are buying all over on the site and I can go to some sites and I've seen maybe the analytics behind the scenes and maybe some of my audit. And I know for a fact, there's no way that five people just bought something in the 30 seconds I was on their site. Jon: That's exactly it. Fake social proof is a great example of this, right? So it's having a random number of view, people are viewing this product right now, having X number of people who just bought this product from wherever in the world. And consumers always distrust that now, because it's been abused. Right. But it's a dark pattern because what are they trying to do? They're trying to influence your psychology around social proof and having fear of missing out. And you want what everyone else wants and, Oh, well, if so-and-so just bought that product, then it's probably legit and I should buy it too. And we see this more and more, a really good example is well, and we're getting through a lot of good examples. I could go on for days for examples, but another great example is a fake countdown timer, right? They're introducing scarcity, but it's false scarcity. What I mean by that is sign up within the next five minutes and we'll give you something or okay, we've talked about this in other shows, we did a discounting episode, not too long ago. And you were talking about how your wife just leaves products in the cart, abandons the cart, waits 24 hours and knows there's the discount email coming. You know that that clock is no good. Okay. Reminds me of the old TV commercials call within the next five minutes and you get this free bonus. They have no idea when that commercial is going to run, down to the minute, they don't know. And if you think about it, especially when you see these on news stations, right? News stations have somewhat of a cadence for ad timing, but it's never down to the second, to down to the minute. So there's no way you could start a clock and say in five minutes, right? I guarantee you, if you called them in a week, they'd give you that same price. And it's the exact same thing happening here where there's a whole bunch of these dark patterns that are playing on people's psychology or making it really complicated for them to actually take an action they want to do in order to benefit the brand. Ryan: So what we're not talking about though, is actually having your inventory show on the siting. I actually only have three of these left because Amazon, I see doing that. And based on some of my experience in Amazon, on my brands, I feel the trust that at this point they might change, but that's not what I'm talking about as far as scarcity. Jon: No. Ryan: Okay. It's the manipulation of faking scarcity or faking a countdown timer. Jon: Yes, exactly. Now, if you're just always going to say that there's only three of these left, in order to have scarcity when none exists, then that's a dark pattern. But if you're actually trying to help the consumer, get the product they want and know that, Hey, if you don't buy it, now you're going to have to wait for the next batch to come in. And that could be six weeks or whatever. Right. Then I would put that under the white hat, right. You're really trying to help people and you're giving them more information to make a decision. And that's why this is such an interesting topic. How do you prove what's dark and what's not? Right. If you look at a brand, you mentioned, well, I've had experiences with Amazon. I trust that based on my experiences there. But if you just saw that on some random new e-Comm site that you've never been to before, how do you trust that for sure. How do you know for sure that, that's the reality? Ryan: I personally would have trouble with that. Just knowing as much as I do about e-Comm. Jon: Yeah. You've been burned before, right. There was a great Twitter thread, a few weeks back. It was what is one thing about industry that you work in that the general public doesn't know? And this falls under for e-Commerce that I saw somebody posted, well, I run an e-Commerce brand. And we tell people our products are selling out, when they're not. I was like, okay, well, there you go. That's a dark pattern, right? Ryan: Yeah. Happens often. Ryan: Obviously we don't like them. And I would believe they're hurting brands to a degree, but I bet you probably have some data about how does some of these products that you've seen actually do opposite of what this business owner probably intended for it to do, this countdown timer or, Hey, everybody's buying this all over the world. You need to buy now. Jon: Right. Ryan: Do you see it actually hurting the conversion rate? Jon: Well, I will tell you this, first of all, does it work for the initial conversion? Sometimes, perhaps, right? It might, probably not as well as people think, because if you have to get to that level to get people to buy, you probably have other systemic issues that you need to solve. A product issue, a pricing issue, a brand trust issue, right? There's a lot of other things that you should work on solving instead of trying to take the shortcut. So let's say you get that original purchase, right. Then the person comes back to buy again and they notice that, okay, well now I've got another countdown timer, or maybe it happens where like your wife, you wait that timer out every time. And you know, it's not happy now you trust that brand a little less, right? So I would say that on the first purchase, it might work, but for the longer term customer lifetime value growth, and maybe a brand perception angle, no, it's not going to work. I argue that it's going to hurt you more in the longterm. Ryan: Yeah, I guess an argument could be made based on that. But if you only get one sale ever you're selling mattresses, you don't care if they ever come back. Jon: Boom. That's a great example, right? A mattress store, you go to any mattress store. They're always having the best sale ever, always. And you walk into a mattress store, I guarantee you, you're not going to pay the price that's listed there. You can talk them down because they're going to give you a price that is just a random price. And you're going to be able to go in and just say, okay, well, last week it was this other price or, Hey, well, what if I give you a $100 less? And they're probably be like, okay. Yeah, that's true. If the goal is to get that first sale and that's it at all costs, and you're never going to sell to them again. And you just don't care about your brand over the longer term of, with that customer or even your reputation perhaps. Then I would argue sure. Have at it. Still, not ethical or moral in my point of view. But if you don't want to grow a sustainable brand and revenue, then have at it. Ryan: Yeah. And I would argue though, that even if that is unethical, not great, your business won't be around anyway, because people are going to see through it more and more, I think. And then the marketing costs of getting traffic to your site, necessitates at this point, a lifetime value on a customer. Jon: Right. Ryan: If you're not playing the lifetime value game in e-Commerce, I don't think you're going to be hearing from me and Jon in a couple of years. Because you won't be in commerce at the end of the day. You've got to have that. No matter if you're a retailer or if you're a brand that's selling through retailers and on your own site, you have to have a plan for selling to that customer multiple times in the future. Jon: Right, right. Ryan: Building trust, obviously we focus on that on both of our ends of marketing constantly and dark patterns can interrupt that even if it's short-term creates commercial rate increase, but are there some areas in this that you say are valuable on both of those counts? Like increases conversion rates and while some people might think this is maybe in that space, it actually does good as far as building the lifetime value as well. Jon: Well, I would say that if your intent is to put up a barrier for the consumer, that there's no positive, they can come of that in my point of view, right? People are at your site because they're there to complete a task, right. They think that your product or service can help them complete that task. And now if you are trying to actively prevent them from completing the task, they want to complete only because you want them to complete the tasks you want them to do. There's no positive that's going to come out of that. Right. For instance, you're in a checkout and the default check is yes, subscribe email list, right. How many times do people just leave that checked, right. Or you use confusing language check here to not receive our emails lists each week. Ryan: I love that example of yours. Like, wait, what do I... Is it checked? Jon: Exactly. Yeah. All of that stuff is where I end up getting really, really frustrated. And when I see that stuff often, quite honestly, I choose not to work with that brand. I just say we're not a good fit because our mission to remove all of these bad online experiences is not going to be further long by working with them because they don't really want to help the consumer. Right. Maybe it's a mistake if there's one of them or maybe they got some bad advice at some point, if it's just one thing that's happening, or they using an app that makes it too easy to do that. Like one of those purchase apps you were talking about that come up out of the corner and telling you that somebody purchased recently, but they didn't. But I would say, at that point there's really not anything I can do to change the ethics of that company. And that's, I think what this really comes down to. And there's too many brands out there that want to help consumers and do the right thing that they don't... We don't need to work with the brands who are only just trying to use psychology to trick people into purchasing. Ryan: Yeah. I think both of us have been as long enough. We know there's a lot of people in our industry that loves selling some snake oil and there are a lot of them giving bad advice and I come across constantly. So that's why my mission's probably not as holistic or maybe pretty as yours. I'll say mine is like, I just want to put all my competitors out of business that are selling snake oil and then sell [crosstalk 00:17:04] behind me. Jon: Exactly. Ryan: Save e-Comm brands from stupid advice. Jon: Hey, that's a good moral lesson in that though. Right? Just making it happen. Right. And I think the reality is, is you guys have won it Logical Position, and you've gotten as big as you have because of the way you treat people and handle these accounts. Right. You would never be serving 6,000 clients if you tried all these tricks because there would be a handful of people out there who would be okay with it. But the vast majority of brands are good. And I wholeheartedly believe that, but unfortunately, what do they say? That one bad Apple spoils the whole bunch. Is that the phrase? Ryan: Yeah. At least it does on my phone. Jon: Yeah. I've been apple picking once when I was a kid maybe, but I can't claim to have much farm experience. Ryan: So, just as in most things in business, as long as you filter through some type of lens that says, is this something I would be comfortable with my mom getting or being presented with like, Hey, if I'm lying that somebody is checking out and there's an app for that. Why on earth would it make sense for me to put it on there? If I know that, Hey, this might convince my mom to buy something she doesn't need and be a good human at the end of the day. If you do that as a business owner with an e-Comm site, you're not going to be putting these things on there to do this. And hopefully we're going to help you put your competitors out of business who are trying to do those things. Jon: Well, I think that's a great lens to put this through the mom test, right. Be thinking about this. If you are doing something that you wouldn't want done to your mom. Then don't do it. Right. And I think that, that's a really good way to look at this. If it would trick your mom into doing something that she really didn't want to do, then just get rid of it. Would you want your mom automatically opting into this privacy statement or would you want your mom to automatically get these emails? And you know she'd be frustrated if she just wants to purchase a product. And all of a sudden was getting marketing emails every day. Or if she got tricked into doing an upsell on a product, because it was default added to the cart, the highest, most expensive shipping option was chosen when there were way cheaper options. There's a lot of things like that that happen all the time. And the problem is, it's really something that would frustrate most people. But I think I see it more than probably the casual online shopper, but I also have [inaudible 00:19:40] and obligation to resolve those problems when I see them as much as possible. Ryan: Yeah. And if you do convert optimization, right, you don't need them. Jon: Right. Ryan: And that's the crazy thing. You don't need gimmicks, if you've got a solid business, good products, and you've worked with Jon, or if you're not quite to Jon's level, you're doing just good things at the end of the day. And I think the example of shipping is a phenomenal one that I didn't even think about until you said it that as a business owner, you're like, Hey, shipping, we make margin on this shipping or not this shipping. And we have free shipping here or not, but you can just check this one because it just makes sense maybe from a business perspective where is, we need more margin here because we're giving it up here. But at the end of the day, if you just do what is right, that you would want done to you, you've got that potential for customer lifetime value. Jon: Right. Ryan: And that's where your profit can come from. Jon: Yeah. I really like your approach of, if you've wouldn't do it to your mom, don't do it on your set. I think that's great. I wholeheartedly believe in that. And I think all of these things would fall under that. Right. Would you really want to do face fake scarcity and make your mom believe there's only one item left when there's not? Ryan: I'll tell you your mom, she's an idiot that she doesn't want to save money. I know my mom wants to save money, believe me. I'm not going to call her an idiot for not- Jon: Exactly. She doesn't want your emails. That's why she's clicking no. But... Ryan: Yep. Jon: Yeah. Well, I think this has been great conversation though. Ryan: Yeah. Me too. So is there anything anybody needs to know that we haven't touched on when it comes to dark patterns or things you can or might do to your site even by accident that you just want to be aware of? Jon: Yeah. I would think the first thing you should do when you add any app from the Shopify app store or any of those is give it a good look. Don't just use it because you see a competitor using it. Don't just assume they have positive intent here, go install it and then really dig in. Do some user testing on it, get understanding from consumers. Is it really being helpful for them or is it causing a another barrier in their road to conversion? And if it is ask yourself, am I putting up that barrier because it's better for me, or am I putting up that barrier unnecessarily? And it's actually making it hard for them to complete the purchase, which is what you ultimately want. And I have yet to hear an example that fits into both of those. Again, it's either black or white, it's either white hat or black hat, and there's really nothing in between that I can find. And if somebody listening to this has a great example of that. Please let me know. I would love to have some good examples of that. Ryan: Put it on LinkedIn, share it with Jon, so we can all see. Jon: Yeah. Tag Ryan and I. Ryan: Well, thanks Jon. I appreciate you giving me an education and anybody else's listening for that because it's very helpful. Jon: Awesome. Thanks Ryan. Appreciate the conversation. Ryan: Thank you.

It seems most brands are using email popups on their website. Today Jon dismantles this practice with passion, explaining why they're bad for everyone, and offering better alternatives. TRANSCRIPT: Ryan: Jon, we've spoke together quite a few times around the country, and then recently just around the internet, since we can't leave our houses. And almost every time we talk, you ruffle quite a few feathers when you're answering questions about email pop-ups. It seems that most retailers and brands out there on their websites, they are absolutely in love with their email pop-up campaign, they think it can do no wrong. And I personally don't like them because they're just annoying and I close them immediately because I'm trying to look at something else. And, but you're distaste, some may say hate, goes a little bit deeper within this space, but so many, again, so many brands are using these. It's just making me crazy. So, I want to talk about these and get your opinion, the backend and the numbers that are guiding your distaste for these. But even to start with, what do you think is pushing this trend and what data are these merchants seeing that's causing these email pop-ups for discounts or anything just to become the norm? If you don't have it, you're weird almost at this point. Jon: Brands, what they're doing is they see another successful brand they look up to have email popups and they say, "It must be working for them. We need to do this as well." It goes in line with all the little Shopify apps that are out there that just spread like wildfire overnight, and then they'd disappear just as quickly once everybody realizes they don't actually move the needle, but they saw their competitor trying it out, so they thought they showed as well. Tons of examples of that. I think that's generally what happens here, first of all. Second of all, the brands see that email is their highest revenue channel, most likely. And so, they say every time I send an email, it's like printing money. So I should collect more emails. And that sometimes even comes down from the executive level, down to that marketing manager who is needing to implement that, whether they think it's right or not. And third, I think what happens is that brands look at a success metric of how many people do we have on our email list. And they see these pop-ups collect email addresses. And so, they assume they are working. And I guess the goal that they usually have is just to collect email addresses at all costs, right? And they're thinking, "If I get someone on my email list, I can then continue to market to them and the rest will fall into line." And that just is a huge problem. It's, to me, it's the wrong way to be thinking about it. And after optimizing sites for 11 years, statistically, it's not accurate. Ryan: Being an e-commerce brand myself, I know that if my email list goes from 10,000 to 20,000, I'm probably making more money from email. So, where are brands missing the logic behind these pop-ups and not equating to larger email database equals more revenue from emails every time I send one? Jon: Yeah. I think, I don't have an issue with collecting email addresses. As I said, it should be, and looking at 10 decades of content and data around emails, it definitely can be your highest revenue channel. The problem I have with is the method of collecting, right? So, let's just start with that. I mean, we could, there's lots of directions, we'll, I'm sure we'll go today about the method of doing it around discounts and everything else, but let's just talk about the pop-up form in itself. And what I mean by that is just there are multiple ways to collect email addresses. You can start with those who have ordered and how you have the actual customer contact information that you own, right? If you doing an owned to sale, as opposed to something like an Amazon, then you have that information, people you can remarket to and continue to sell to. However, if you just put a pop-up on your site versus maybe even baking a form into the page, right? Where customers who are actually interested, will scroll down to your footer and they'll enter their information because they're super interested. Right? I would almost encourage anyone listening to this to set a separate form up in your footer and tag people who fill that form out as higher intent, because they actually are interested in what you had to say. Now, the problem with a pop-up, let's just talk about straight up pop up, not an exit intent, right? Ryan: So, you're categorizing your email pops up into different buckets? Jon: Yes. Yes. There's different types. And I think that's important here because the one that I want to eliminate from the internet is just the pop-up. As soon as I come to a site, or maybe as soon as I start scrolling or even the timed ones that come up within a couple of seconds of loading the page, those are the ones I want to eliminate. Now, exit intent. Let's put that in a different category. I'm not as opposed to those. But what I'm talking about here is the disruption to the consumer experience, the interruption factor as well. Think of your site like a retail store. Now I know your wife has a retail store, right? If I walk into her store and she jumped out at me and said, "Here's a clipboard, give me your email address." I'm going to probably have a negative reaction to that. Right? Ryan: At least she's cute. That does help. Jon: Well, Hey. Ryan: Popups, aren't as cute. Jon: Hey, you know what I mean? You could make, you could put a nice looking picture on a pop-up, but that still doesn't change the fact that I'm there because I have a problem that I'm looking to solve. And I'm at the website because I think that their product or service can solve my pain or need. And all of a sudden now, before I know anything about the brand, something led me there, was it I clicked on an ad or a Google search or someone told me about it, so I have idea that they can help me solve my pain or need. But then all of a sudden I just get there, I still don't know about the value proposition of the brand, I don't know much about their products yet, but then I'm getting hit up right away being asked to give them information. And I think that that's just disruptive and I can promise you every test we've run where we've eliminated that pop-up conversion rates have gone up on the site and sales and revenue. Now yes, you will collect less email addresses. But I argue that's not a bad thing in this case, with this type of pop-up. And the reason is a couple of faults. So, first of all, the email addresses you're going to collect out of those pop-ups are going to be very, I would argue they're not going to be very effective, right? Because you're getting a consumer who is entering their email address into that pop-up specifically to get rid of the pop-up in a lot of cases, because they... This goes into more things like negative intent shaming, because maybe in that popup, it's a pretty common trend now for a company to say something like, "No, I don't like discounts and offers." Ryan: Gosh, I hate that. I had that happen a couple of days ago. And I was like, "Of course I like discounts. I'm not an idiot, but I just don't like you telling me that I don't like discounts." Jon: Right. You're you're hurting the brand, right? And you're hurting your customer experience and that's damaged that you now have to repair. So, within the first five seconds of getting into the website, you're already have dug yourself a hole you have to get out. Ryan: Yeah. And I think brands are getting kind of like, "Ooh, we're kind of that little unique, give it to the man brand. And we're going to use that humor." [crosstalk 00:07:34] That doesn't necessarily come through because I actually don't know you yet. And maybe that's my first... I don't know that that's the type of brand you are. I was looking for a pair of board shorts. And now all of a sudden you're telling me I'm an idiot before I even know that you're, that's the voice of your brand. Jon: Exactly. Okay. This is another great example of real world for this, right? Popups are just like those people who canvas on the street corner, who come up and you're just trying to walk by and get to your next location, right? You're trying to get some job done in your life, going to the coffee shop or whatever it might be, you have a meeting you're walking to. And Greenpeace, not just to pick on Greenpeace, but they're out all over in Portland. They run up to you with a clipboard and they say, "Hi, can we chat for a minute?" And it's like, "No, I'm trying to get something done. This is not a good time for me." And then they follow you, "Well, did you know that this is happening with the environment? And this is happening." And it's like, "Yeah. You know what? That might still be important to me, but now's not a good time." And they're like, "That's fine. Just give me your contact information. We'll follow up with you." And it's like, "No, no, no. I don't know who you are." Right? I don't want to just give some random person my contact information. And then what are you doing with that contact information? So, I think the problem is, is that marketers stop having empathy for what the consumer is going through on the other side of the screen, and they just feel like it's okay because they can't see that person to do these really poor consumer experience activities on their site. And that's what I try to fight against with this. And unfortunately pop-ups is the worst example of this on the internet. And so, that's why I ended up fighting against it. Ryan: Oh yeah. And it's people like me that are probably helping give them bad numbers since my computer saves the email address na@na.com for all of my form fills that I don't want them to email me on and I'm like, "Yeah. Yeah, here you go. Have that." Jon: Well, that's exactly it. So, now let's talk about the data that a marketer's going to get back out of this pop-up, right. So, a new site pop-up, you just came to this, a new visitor pop-up I should say. I get a form. Sometimes it just says, "Give me your info and you can stay up to date on the latest product releases, et cetera." So maybe they're not really dangling a carrot there. Right? I can't figure out how to close it. Maybe there's no close button and it takes over the entire screen and it's really annoying. So what happens? You put in an email address that like na@na.com, right? So now the brand has pretty muddy CRM, right? Their customer data, their marketing data is pretty horrible. Now what's going to happen there is, they're going to start using all that data. Some will clean it, but I guarantee you most don't based on our experience and what happens is they're going to use those email addresses that are uncleaned. They're going to start sending them through their email platform. And then they're going to get a ton of bounces, a ton of spam complaints for those who might be okay, it might be good, or they're going to get a bunch of generic Gmails that never get opened. And I promise you one thing that's happening with your emails and large providers like Gmail, MSN, et cetera, is they're tracking when you send an email out to a thousand people, Gmail knows that at that same email is going out to a thousand people on their platform, and they're looking to see how many people are opening and clicking on that. And they're tracking that data to make sure that spam doesn't get through. And if nobody's opening it, nobody's clicking it, it's more likely to end up in that dreaded promotions folder or just directly into spam. [crosstalk 00:11:07]. And that's not even without people who are actually seeing that email and marking it as spam, which is only going to hurt your deliverability. So, over time what's happening is the quality of your email list is going way down only because of how you collected that as emails and the methodology you went through. And so, what happens then is you've turned what should be your highest revenue generating channel into something that is no longer producing at the level it used to, even though you have more email addresses on it. Ryan: Got it. Okay. That makes a lot of sense there. And you can kind of send yourself in a downward spiral. But I can also see the logic behind getting to that point. If logic states that me as a brand or a website, I'm willing to break even on my first order from Google ads when I'm buying traffic to my site, and then if I don't have an email up and I put it on, I'm like, "Oh, 10% discount. That's only going to increase people's conversion rates because I'm giving 10% off. But then these are people that maybe weren't going to buy, but now are because people that were going to buy, maybe they would anyway without the discount." So, I understand that logic to a degree, but how do you see that logic break down when somebody actually starts going through with that execution? Jon: Well, so now we're combining two negatives. We're taking an email pop-up that's disruptive and we're making it a discount. Now what's happening is same thing. As you said earlier, I just got to the brand, I don't know anything about the brand or their value proposition, et cetera, but now you want my contact information, and also you're already giving me a discount. Now, why are you offering a discount to somebody who just got to your site? They haven't exhibited any signs of intent to buy just yet, other than showing up at your door and you're giving up precious margin and you're creating a discount brand right away. Where it's the first thing I know about this brand is, they're going to give me a 10% off for giving me an email address. It's like, "Well, okay." And what's going to happen here is a couple of things. One is, you're creating a discount customer who sees your brand as a discount brand forever, just because that's the first impression they have. And the problem with this is you've done it just to collect an email address. Well guess what? What's going to happen now is that person's going to put in their junk email address again, the one they use just for discounts and pop-ups, right? Ryan: Everybody's got one of those. Jon: Exactly. We all use Gmail for that, probably. Right. So, then what happens from there? Well, perhaps they might open the email, maybe not, more likely not. They just wanted that discount code. And the worst offenders in these popups are the ones that, where they collect the email address without any verification, they don't email you the discount code. They just show it in the box in the pop-up. So, they just give it to you right away. Well, then that's even worse because you're putting in whatever email address you want and you're still going to get the discount. The other thing here is that, now every time I come back to buy, I'm going to want that discount. And I know I don't need to pay retail. I know that you're going to offer 10%. So, what am I going to do? I'm going to open your website in incognito, and I'm going to give you another fake email address just to get another discount code or another junk email address, or I'm going to do that Gmail trick, where you can put a plus sign and then anything you want after the plus sign. So, it's like Jon+, whatever I want @gmail.com and it ignores anything with the plus sign and after that. Ryan: That I did not know. Jon: So, you can create [crosstalk 00:14:31] a million email addresses just out of your one Gmail address. And most email platforms allow you to use a plus sign because it's a valid email character. And so, it's really interesting when we start working with brands, one of the first things we do when they put up a fight about removing their pop-ups, or at least running a test around it, is we go into their email database and check for the plus sign and see how many emails have a plus sign in it. And most of it it's like, plus spam is what people put, right? Or they'll even get more tricky. People who are really, want to know if you're selling their email address, or if you're giving it away or if you're abusing them and they do plus in the brand name. And then it's like if you sell that email address or share with a partner, do anything else, they now know where that came from, and they're even more upset with you when that happens. So, I think it's really important here that people, brands really need to think about not discounting because you're basically taking what is a bad consumer experience and you're making that a bad experience for your brand too. And you're just doing that to collect an email address. And now you've created a discount customer right up front, who's forever going to look at your brand as a discount brand. And that's a really hard hole to dig out of in the future. Ryan: Well, and I think a lot of brands don't give consumers enough credit, and I think people pick it up pretty quick, where they know the strategies to try to get discounts. Especially people like me that just because I can, I'm not going to give up 10% of my money to a brand just because I like them. If I can keep 10% in my pocket, I will, even if I can afford the full price, which generally is the case, if I'm shopping for it. And so, my wife knows that I'm the cheap one in the relationship. And if she's going to go buy something, she knows that if she can tell me she bought something, but got a discount, and I'm like, I'm much less likely to put up a fight about that. And so she knows the strategy. It's like, "Okay, all I need to do on my computer is start to move my cursor towards the navigation bar and boom, exit intent pop up." Or she even tells me now, she'll just, if she's interested in something, but it's not a need, it's a more of a want, she'll go put things in shopping carts, and then just wait a few days. She's like, "I don't need it right now. They're not going to run out of inventory. I'm going to go set up a shopping cart, I don't care. See if they sent me a discount." [crosstalk 00:17:29]. Almost all of them do. I mean, just people figure it out. It's not complicated. Marketers, I think sometimes think too much of themselves like, "Oh, we're going to do this. And we're going to trick all these people into spending so much money with us." And I'm like, "Nah." Jon: Well, I think that's exactly where having empathy for the consumer really comes in, right? And just saying, "If you, if this is happening to you, what's the experience you want to have?" And I think this goes back to a whole nother episode we can record on discounting and why that's a challenge. I mean, we just did, you and I just did a webinar yesterday and a big portion of that was about discounting with one of our partners. And I thought it was really interesting because so many brands are discounting. And when you think about this, you could be doing so many things that are and offer and not a straight percentage or dollar off discount. And I'm okay with doing an offer in an email. And there's a lot of other ways to collect email addresses that tie in with offers, right? I mean, you could do "Coming soon, get on the list to be first notified," and that's providing value for an email address that they wouldn't get unless they gave you the email address. But it's also valuable to them. You could do, something where it's like, "Hey, if you sign up for our email list in checkout, you get free shipping." Right? So, you're giving some value. It's not a straight dollar or percentage off discount. You're doing an offer and there's scarcity. You could say, "Hey, these products sell out. It's sold out right now. If you sign up for this list, you'll be notified." And we have a brand we work with, a really high end camping brand, that a lot of their products, they sell out before they've even landed in the United States for manufacturing, where they just have a running list on their product detail pages that say, "Hey, this product is sold out. We have a new product coming in soon, get on the list, we'll notify you. And it will be presale before it goes up on the site." Now there's a lot of value to a consumer who wants a product and is interested in that and giving their email address for that purpose. And it's a much better way to collect an email address over offering a discount. So, now they're selling these products before they've even hit the site. They're selling them at 100% margin or, well, not 100% margin, but without draining their margin by discount, right? Ryan: Or marketing. Jon: Or marketing costs. [crosstalk 00:19:54]. Yeah. What? Fractions of a penny to send that email. So, I think it's really interesting that brands immediately go to this discount right upfront and present that discount through such a disruptive manner that they have to use an email pop-up. Ryan: I think it's just, I mean, it's the easy button that they're thinking about. They're not taking that next step and actually having conversations with people, strategizing what could my options be? Because even me, having you as a friend and a business partner and various things, I come to you and I'm like, "Okay, Jon, I know you don't like discounts, but I know that there's value in somehow doing something like that, that maybe is not a discount, that keeps me from being a discount brand." And you've got phenomenal ideas for ... Now, we should probably do one, a thing on that. But you don't have to give a discount to give a discount type thing, which is a difficult thing. You have to really think through it. Jon: Right. Yeah. And you got to be creative with the offer, right? And sometimes people, like you said, it's the easy button. There's so many Shopify apps, for instance, that do these pop-ups and do discounts. Then there's apps that are really cheap to free that will do customized discount posts for email address exchange, stuff like that. It blows my mind because they see other brands using them and they think it must work for them, so we're going to do it too. Or they just, they think discounting is the only way. And I really argued that as soon as you get into discounting, it is impossible. It's like a drug, a really bad drug. It's really hard to get off of that. You got to wean yourself off of it because now everybody is expecting and they're not going to pay retail price. I mean, we talk about how your wife sends you to Michael's to pick up stuff on the way home. And you know that she's going to have a 50% off coupon, no matter what. And if she didn't, for whatever reason, she couldn't find one right then, or whatever, you just ask the person at the register when you're checking out, like, "Hey, what's that? What's the coupon that went out in the mail last week? Do you have it?" And they're like, "Oh yeah, it's right here. Here you go." And they just scan it [crosstalk 00:21:55]. Ryan: Yeah. That actually happened a couple weeks ago. [crosstalk 00:00:21:58]. I was, I got in line, she was like, "I couldn't find my code. Can you just pull one up on your phone and do a search?" I'm like, "Okay, yeah. I'll figure it out." Jon: Exactly. So, they're a discount brand and you go to them because they're a discount brand. There's nothing wrong with that if that's how they want to do it. But I would argue that, they're never getting out of that, right? They're just going to have to slash all their prices if they want to stop doing discounts. Then what promo or offer can you run because you've got razor thin margins at that point? Ryan: Yep. No. And I think one of the points you hit on too, is part of that other bucket of email popups, which you don't hate, those exit intent things. And this one works phenomenally well, for me at least, with one of the clients you've worked with in the past is Nike. One of the shoe companies you're based in Oregon. And I have an affinity for Jordan 4's. I'm not a sneaker head, but that's the one shoe that I grew up always wanting and I couldn't get them because didn't have enough money for them when I was a kid. But now I can. And so, I do keep up on the releases. And so, in this case, I gave Nike all my information to avoid the FOMO, the fear of missing out scenario. And I went to Nike site today just to see what they were doing, saying, "Okay, Jon worked with them. Did they get the message when he was working with them?" And they use only exit intent, no discount. Do you ever advocate for discount at... Well, I already know the answer. But exit intent, how should brands be looking at that? Is there anything besides FOMO or anything to do besides offering a discount that you've seen be successful? Jon: Well, I think that there's a lot of options that you can do in these pop-ups. But specifically in exit intent, this is where it's one of those things that you should really be looking at segmenting your audience and tailoring the message with those pop-ups. So, for you, let's think about the journey you just mentioned you went through. You were, you love Jordan 4's and you were looking at those on the site and they popped up with an exit intent and you were like, "Yeah, sure. I'll do that because I want to be the first to know when new ones are released." There's value there for you in that, right? And they knew, this is a collector shoe, if you will. And most of the people, you claim you're not a sneaker-head, but let's be honest, you probably are if you're into Jordan 4's, right? Ryan: Probably. Jon: And so, the reality here is they know that. That people who are looking at this shoe aren't discount motivated because for them it's all about having the Jordan 4, that they don't need the discount. They could sell those out, no problem without ever discounting them. And in fact, you and I living in Portland, Oregon, we're blessed that we get to go to the Nike employee store occasionally. And whether we're working with them or, somebody who does work with them is able to share a pass with us occasionally. And I can tell you that they have some Jordan's there, but it's not their top sellers. I say that because at the employee store, there's a large discount when you shop there because you get employee pricing, but they don't have their top sellers, usually, in the collectible ones, like Jordan's et cetera there, because they don't need to discount them. If you want them, you're going to just go up on the site and buy it at retail. So, I think that too many brands skip right away to the discount when there's other value adds you could provide. And that's where, again, you got to do a little bit of thinking on that. It can't just be the easy button. Ryan: Okay. So, pop-ups, avoid coming to the site pop-ups. Exit intent could be worth it, but you make sure you're adding some value to that, that customer that causes them to want to give you a real email address and not necessarily just throw a discount out. So, all companies want more emails. Do you have any strategies that you've seen be successful in your experience over the past decade in the e-comm world for brands to get more emails? Jon: Sure. I think there are some great ways to do, I mentioned earlier, some segmenting. So, let's say you run somebody in to your site from a Google ad that has a specific message, your value prop in it, aligning that with the message that you share for an email signup, right? So, maybe they're searching for a specific item and they get to your site and it's out of stock, well, there you go, now you should do not a stock email collection. I think that the biggest mistakes I see around email forms are that they're missing some key information. The first is you really need to set expectations on this email form. What does that mean? Well, you need to tell people what they're signing up for and how often they're going to hear from you. Pretty simple. But most brands say stuff like, "Sign up for updates." It's like, "Why do I care about updates from your brand?" Right? "I don't need more updates." Nobody needs updates. But if you me, I'll be the first to know when Jordan 4's are released, I'm in, right? That's what I'm here for. That's what I want to know. So, it's all about saying, "Okay. Well, how often are you going to hear from me?" Well, maybe it's, "I'll email you once a month." Okay. I'm okay with that. If you say, "I'm going to email you every week," I have to think twice about it, but if I really am into your brand, maybe I'm okay with that. Or maybe it's where we have special product bundles that are only for email subscribers, "Sign up and you can learn about our bundles, exclusives." Right? Things of that sort, that aren't straight up discounts. Ryan: Almost like a merging some of this email acquisition with your loyalty program. Jon: 100%. That is a great way to build email is through loyalty. It's through having, whether you want to do something as complicated as a point system, or just as simple as saying, if you're on an email address, you will get access to things that people who aren't on the email address. Ryan: And people are willing to give you more information, generally, when you're providing value outside of discount. For example, Nike, I give them my birthday. No other company gets my birthday. [crosstalk 00:27:51]. But they're telling me I'm going to get a special reward on my birthday. And I'm like, "Cool." I like Nike. They do have some trust. They built a brand that says, "I can trust them with my data already," just because I have an affinity for them and I've been wearing Nike's for, geez, 30 years. So, there is some of that that maybe not every brand is going to be able to get to, but you can probably do some pretty solid segmentation in your customer database if you had everybody's birthday. Like, Hey, this person's 20, this person's 40, they probably need different messaging. They probably have different interests, different disposable income level. Jon: Yeah. Yeah. The 20 year old is aspiring to get the Jordan's. The Ryan Garrow age folks are really out there to [crosstalk 00:28:35]. Ryan: 22. 22. Jon: Okay. Okay. If you say so. And so I think it's, now you can afford the $300 pair of Jordan's and you're excited to buy them because you've earned that right over all these years of hard work, right? And so, or those two years of hard work, if you will. But I think it's one of those things where most brands aren't even segmenting. They're just doing that really clear scatter shot, hoping to collect email addresses, just to build their list. And I just, again, that's the wrong philosophy, whole-heartedly, full stop. Popups are not the way to do that. And I just, it pains me when I see brands do that. Part of me is because our mission at The Good is, I say all the time is just to remove all the bad online experiences until only the good ones remain. And email popups are such a bad online experience. I'm on a crusade to eliminate those. And part of that is to help brands understand what damage they're doing with these initial email pop-ups. And it's true, I don't hate them just because they get in my way as a consumer, I hate them because of what they do to the brand over time. And the experience that you're putting consumers through is really negatively affecting the brand and the brand perception. And then most brands are applying a discount on top of that, so they're kind of adding fuel to that fire of just negativity and it's really just going to hurt them. Ryan: And the one thing I'll leave with would be the best emails you can get are from people that have purchased from you. So, if you just got more aggressive on getting more customers through marketing or driving people to the site, those people in your email database are going to be infinitely more valuable than anybody that just wants a coupon code or signs up just to have you go away or an email pop-up. So, I would challenge a lot of brands just to say, if you're comfortable giving an additional 10% discount, so you're taking 10% off your top line for somebody, why don't you just get 10% more aggressive on your marketing and get that customer to actually buy something and get more of them and increase your market share because that's the type of emails in my database that I'm going to be in love with. Jon: Yeah. I mean, you mentioned right up off the top that you're happy to spend your initial margin on that first purchase to acquire the customer through Google ads or whatever advertising you would do to get them to the site, so that you can continue to market to them and go after that customer lifetime value. And that's the right way to approach this because that's sustainable. Where if you're just going to give a discount and someone's only going to purchase once, because they can't get that discount again, or maybe they just see you as a discount brand, then you're going to have a bigger issue. So, I'm all for paying to get people to purchase, but I'm not, I don't think you should do that through a discount upfront. Ryan: Yeah. Don't go the lazy way. If your marketing team or your agency is telling you, "Use discounts or we can't do our job." It's time to maybe look outside that. Jon: Yeah. Find a new marketing agency. People come to us all the time and they say, "Well, we've been doing optimization on our site." And I say, "Okay, great. Let's talk about what you've been doing." "Well, we put a pop-up on, we offer discounts and our conversion rates went up." I was like, "Well, yeah. You know what? Every house will sell at some price. Ask any realtor. And they'll just say, 'Well, we'll just keep reducing the price until it sells.'" And it's like, well, eventually you're going to sell it for less than you bought it for. And that's exactly what's going to happen with your brand too. Ryan: Oh, and didn't you, you have some stat around, you give a small discount, your conversion rate has to go up just some astronomical percent. What was that number? Jon: Yeah. Mackenzie did a bunch of research on this. They surveyed and did a bunch of research on the, it was like the top 1000 e-comm sites. And what they found was that for every 5% that you run a discount on, you have to acquire, it was like 19% in additional sales just to break even on that discount. Ryan: And most people are not only giving 5%. Jon: Right. It's way more than that [crosstalk 00:32:36]. Ryan: It's usually 10, 15, 20%. Jon: And so, you really have to think about this. Now for 5% discount, is that 5% discount going to get me greater than a 19% additional sales? Likely, that's not the case. And, in fact, the article that I read on that said, and I'll have to quote it, but it said "This rarely to never has ever happened." And I was like, "Okay. So, they said rarely, never, and ever in the same sentence." Ryan: Yeah. Having done this a decade, I can almost guarantee you that that has not happened. I mean, because you would just double that maybe for 10%, you have to get 38% increase in revenue for a 10% discount. There's no way. Jon: If, I mean, if that's how the math works out on that, then yeah, you're screwed if you start discounting at that rate in reality. Because yes, you've collected email addresses and markers will come back to me and say, "Jon, yeah, sure. That's if I only do it on that first sale, but now I'm going to have those customer in my database for a lifetime." And I'm like, "Yeah, but what are you going to have to do to get them continue to buy? You're going to have to give another 5% off and another 5% and another 5%. where do you get out of digging that hole? Right? How do you fill that hole so that you're getting your margin back and your customer lifetime value and your average order value keeps going up? How do you make that happen?" You're better off it doing an offer. And, yep, it may equate to 5% off, but in the mind of the consumer, you're giving them an offer, not a straight dollar or percentage off. And then you come back the next order and you're not having to fight on a discount, you can give them some other offer, perhaps if that's needed. So yeah, we should definitely do a whole show, Ryan, on discounting. I think that could be another way to share one of Jon's things he hates on the internet. Ryan: Yes. I think we for sure should do that. Man, there's so many, so many good things in this. Jon, thanks for the time. I appreciate it. And I come away learning lots of things, including just adding a plus sign to my emails now. [crosstalk 00:34:30]. I can track where I'm being sold. Jon: There you go. Well, I appreciate you bringing the topic up and helping me share one of my missions. So, thanks for doing that. Ryan: Thank you

We know that internet traffic doesn't operate in silos. No matter what method you are using to drive traffic and sales, there's always going to be a halo effect. Today Jon and Ryan chat about Google Shopping, but more specifically the effect it has on other channels. TRANSCRIPT: Jon: Hey, thanks for listening to Drive and Convert. Before we jump into this episode, just wanted to take a quick second and let you know that during this episode we had some recording issues and the audio quality is nowhere near where we would normally like to see it. But because the content was solid, we decided to keep it as is and get it out to you. Hopefully you can see through this less than perfect audio, but a big shout out to our editor, Josh, for helping make us sound pretty solid, despite all of the technical shortcomings. We do have some improvements in audio quality on the way, so thank you for listening and on to the show. Jon: Ryan, we know that internet traffic doesn't operate in silos. No matter what method you are using to drive traffic and sales, there's always going to be a halo effect. We've all heard this famous quote from 120 years ago, "Half the money I spend on advertising is wasted. The trouble is, I don't know which half." That is still true today, even with all of the attribution and digital advertising tracking we're able to do. But the good news is that with all of the data we have these days, it allows us to know that there is a halo effect and to know how much that halo effect is worth to each brand. I was recently checking out a presentation you gave [Aclavio 00:01:44] and you showed data for some real clients that blew my mind and I actually just found out one of them is a shared client of ours, which made me even more excited. Ryan: Yeah, maybe some of that's due to you. Jon: Hey, I'm not going to take credit for this, but the data was a comparison of revenue and performance before and after implementing Google Shopping. I'm talking 1800% increases in revenue in both of these cases. Tens of hundreds of thousands of dollars in newly found revenue. Now, it seems to me that Google Shopping itself didn't account for most of this revenue gain, but rather that it could be attributed to the halo effect of implementing Google Shopping correctly. Today I wanted to chat about Google Shopping, but more specifically the effect it has on other channels. Ryan: Oh, man. It is such a unique topic that doesn't get brought up enough. I'm exciting to really dive into this. I don't even necessarily know if halo effect is a technical term that anybody really uses. It's just kind of how we refer to it internally at Logical Position and what we're seeing. Jon: But I do think it makes sense though. You said halo effect originally when we started talking about the topic for today and I immediately got it. Here you are inventing another term, perhaps, that makes a lot of sense. Ryan, tell me. What is the benefit of understanding the halo effect of Google Shopping? Maybe we just start there. Ryan: As you're understanding conceptually, and most I think business owners, marketing teams understand that attribution paths generally look like bowls of spaghetti at this point in time, as people can really easily do research and understand what they want from a product as they're finding it and then coming back to business that they had maybe found it somewhere on. What I've learned, through the last decade plus in digital marketing and a lot of that in eCommerce, is that I'm weird in the eCommerce transaction space. I have a very linear conversion path. I see it. I click it. I buy it. Every company on the planet can track my conversion. It's just very simple. If I've bought from you, you know exactly how I found you. Maybe I don't do enough research or I do enough research before I actually go search for the product. I haven't done a lot of analysis on myself, but that's not normal. What's more normal is my wife buying something, where she'll do research over probably a week and a half and she's got a pretty low threshold for extensive research. If she's going to buy something for $25, she does a decent amount of research to make sure that that's the best deal. But she'll click on multiple shopping ads, multiple social ads, multiple things throughout the process as she goes back and forth between different sites to figure out where she should buy something. Through that process, what we've seen is that the Google Shopping click, for somebody that is more normal like my wife, is how people are originally going to find you, but it's not how they're, at the end of the day, going to buy from you. It's more of a discovery tool for a lot of people because Google is a research entity for most people in finding the product on eComm. They're very good at it. Google is just phenomenal at product discovery and helping people figure out what they need or want. Knowing that, most business owners still look at Google Shopping based on last click, because that's what Google Ads has set them up for. Google Ads tracking by default is last click. You can change it to be linear. You can change it to all these other things, which can make sense, but I don't necessarily think it's bad to be looking at that way, but I think you have to understand as a business owner or marketing team that it's doing other things and that attribution conversation... I've been in digital marketing for over a decade, just like you, and attribution just makes my brain hurt. Jon: Yeah, there's too many models. None of them are ever accurate. Ryan: Yeah. You conceptually know it's there, but you never really want to be like, "Let's really dive into attribution today." That has never come out of my mouth and probably never will. Jon: I'm pretty nerdy, but it's never come out of my mouth either. Ryan: Yeah. That just doesn't sound fun. No. No, not going to do it. The halo effect is something we've seen and it's an easy way to explain the fact that attribution is happening and we want to be aware of it and know it's there and that helps direct a lot of our goal setting, I think. Knowing that, from a very simple perspective, the more you spend in Google Shopping, the more the other channels on your site are going to increase even if you're not doing anything else to increase them. The easiest example, I think it happened in May of this year. We were in the middle of COVID and pretty strict lockdown at that time. This company is a B2B company and they came to me I think through a partner of ours and we were talking just general strategy and marketing, what were they trying to accomplish as a business. They sold on Amazon. They sold on Walmart. They sold on Ebay. They sold on their website, but it was very small. They didn't really care about the website much at all and they had an agency that had told them that buying on Google was the best place for them to be, which the Google Shopping actions. At that time it was I think they were the 12% mark, based on their product mix. Then, they had another agency tell them that, "Hey, your product makes us too big. You need to shrink it down because it'll never work with that many SKUs." So, they shrunk down their product mix on their website. All these things are coming together. Before they kind of have to look at their company now like a before LP and after LP because it was so dramatic, the change. Their website, in the month of April, did $16,000 in revenue and their buy on Google entity did $34,000. They combined did $50,000 in total revenue from Google and their website and they paid $4,000 for that buy on Google, $34,000. That was their total cost of doing that. By no means bad. There's not many business owners that would be like, "Ah, that's a bad idea. Don't take it." When I told them, I was like, "I think you're leaving a lot of money on the table," because we as an agency have done a lot of pretty advanced analysis on the buy on Google entity. When you run that, generally you're losing about 40% of the volume that you could be getting if you didn't use buy on Google. So, I just said, "It's probably worth a test. It's a very small piece of your business at this point. Let's just go. Give us three months. We'll go with Google Shopping instead of buy on Google and we'll see what happens. If I'm crazy and it's not more volume for you, you can very easily just flip the switch and go back to buy on Google." They thought, "Okay. That's a reasonable test for us. If the website evaporated tomorrow, our business doesn't materially change. So, let's try that." We decided to start May 1. Takes us a week or so to get campaigns up and running, but what happened in the month of May surprised even me, and I've seen lots of things in the digital marketing space. The first month, getting out of the gate, we weren't hyper aggressive. We were getting things in position. We spent a total of $2500 in Google Shopping for this business. They're a multi-million dollar business, so $2500 still wasn't a big number. The data in May, the site did $192,000 in revenue as a whole. That $2500 of spend was given attribution credit in Google Analytics of $115,000. So, they spent less, $1500 less, and they gained a 3X increase in revenue on their Google Shopping by moving from shopping actions to shopping on Google. Which is good and that return is not normal. Nobody should ever reach out to me and say, "I expect you to get that type of return." It would just be- Jon: Well, now that you say it, Ryan. Ryan: ... Yeah, it's out there in the public. Don't say that that's going to happen. It can happen, lightning can strike, but what was really surprising to them is they, on their organize traffic and analytics, they weren't doing any SEO by the way. Their organic traffic, their channel and analytics in the month of April did $10,000 of their $16,000 in revenue. In the month of May, again no SEO, that organize channel and analytics did $45,000. It was up 350%, from $10,000 to $45,000 with no SEO. That's an extreme example of that halo effect, where you spend more in Google Shopping. They find you. They didn't convert through that Google Shopping click, otherwise it would've gotten the attributed revenue and analytics. They came back and bought later, after doing research through your organic links and your organic rankings within Google. Same thing happened on direct traffic. They didn't do any other external marketing and their direct traffic went up 250%. Their email went from, I think, two or three clicks to having $4500 in revenue. Again, no changes in those things to justify that type of increase, but just starting to spend on Google Shopping. The numbers are cool. It's an extreme example that shows the value beyond just looking at the results in Google Analytics or even Google Ads, but just having that understanding that there is more going on. When I'm looking at my businesses... and I talk to business owners regularly and tell them that I am a fairly aggressive marketer, a fairly aggressive business owner, I want to win... I will spend to break even on Google Shopping all day long. It's not exciting for business owners to hear this from me because every business owner usually goes into business to make money and to have profit, but when somebody's looking for your product on Google Shopping and they haven't put another brand or competitor along with that product search, they're a free agent. That's going to go generally to the more aggressive marketer. If I have a competitor that is shooting for profit on Google Shopping and I can break even, I can be more aggressive on there. I can pay more per click than a competitor, so I can get that traffic. I can get that buyer to my site and I'm going to have a good product. Part of my model is I have to have repeat business and lifetime value, but even if I didn't, by spending more on Google Shopping and breaking even, I know about this halo effect and I know that I'm going to get profit from my organic rankings and my direct traffic will increase. So yeah, I may not see the profit from my spending $1,000 to get $2,000. That may not be profitable for many businesses, but understanding that there is profit coming is a pretty big light bulb for a lot of business owners. And a lot of agencies don't talk about this because it is a little more advanced and somebody that's only been in the space for six months to a year may not have understood that this is there. Jon: Well, and it's harder to track, right? Because you can't give a straight answer and just say you tell a client halo effect and they're like, "Well, I'm doing a lot of marketing things." So, any of those could've been the halo effect. Jon: Let me ask you this, what are some of the common challenges to understanding these halo effects? Obviously, you have to have the right data, right? And some attribution. But where do we go from there? Ryan: Step one is just knowing it's there. Okay. If we know it's happening, then I can go look for the data to help explain what the magnitude of it is. I kind of go back to GI Joe growing up, knowing is half the battle. Once you at least conceptually understand that it's going to be there, then we can start looking for examples of it. I keep my analytics investigations pretty simple. I'm by no means one of the experts at Logical Position. There are people that can make my brain hurt in attribution and analytics, so I like looking at the attribution tabs within analytics and seeing, okay, I want to know what is it looking like as far as last click and assisted conversions? I'll click into the attribution and assisted path portion of the conversions tab and I'll click on the top for Google Ads. Then, I want to see the campaign names and I want to filter for campaigns that are shopping. In Logical Position's structure, it's pretty easy. I can just put in the keyword shop and it'll find all the shopping campaigns. Then, I can easily sort for assisted conversions. I can sort for last click. So, people just have to basically understand analytics, by default... and probably 99% plus analytics accounts are going to be setup by the default stuff... it's last non-direct. If somebody clicks on a shopping ad and then comes back later that day, tomorrow, whenever, directly by typing the URL into the browser, that attribution or that credit for the sale is going to go to the channel that was right before that direct. You look in there and you can see, okay, if my shopping campaign did $10,000 in revenue that analytics is telling us it got credit for, it did this work to do this, as far as a last click attribution, you'll see right next to that what did that shopping campaign do for assisted conversions. It's basically telling me, as a business owner, if that shopping campaign wasn't there, if I didn't spend that money, I would for sure lose the $10,000 that it drove in analytics. That would just not be there probably. I can't say for sure, but the majority of that would just evaporate. But what you'll see in assisted is often in shopping, that assisted conversion number is much bigger. It assists on a lot more sales than it closes. That's just the patterns of people shopping and doing more research and making it so easy to click into a site, see what it is, go back to Google, search for another site, see what they're doing. It's very easy. People are using tabs a lot, especially me. I'm a tab-a-holic. I have multiple tabs open as I'm researching. But that assisted conversion, that's where it's just pushing the process forward and something else in analytics is getting credit. So, if you take away that shopping campaign, there's a lot of other revenue that's going to be impacted. Will 100% of that assisted conversion revenue go away? Probably not. But there's no reason you'd want to take that away and you want to keep emphasizing it. By spending more in shopping, there's a lot more of this assisted conversion revenue coming, which is where you're seeing the evidence of this halo effect in the process. Then, you can also do... I like looking at the conversion paths. There is a conversion path report in Analytics and I like going by source medium so I can see if it's Google Ads. You can even get into some of the campaigns and finding out where the campaigns are in the process. This is more advanced, so a lot of people probably aren't ever doing this, but you can download it into Excel and pivot against it and you can actually see which channels is it helping the most, what's getting the credit often, is it coming back through organic from the shopping campaign, is it coming back from an email. Maybe abandoned cart emails are a big deal for your brand. You can see a lot of that and who's getting credit in Analytics. Jon: This is my favorite view in Analytics, by the way, because it really tells you were people are dropping off in the funnel, how they came in. It really shows you a great view of what are the different challenge points along the way, based on where people came from. Ryan: Oh, yeah. When you're looking at it, where are you seeing for most businesses? What channel's often falling off that you're able to help with or that you're able to direct them to and like, "Hey, they seem to be breaking right here." Jon: Usually what we see is when an ad campaign is setting some type of expectations that aren't being met on the site, people then start clicking around a little bit. Maybe they end up on a product detail page eventually that doesn't align with that expectation the ad set. So, the messaging there is usually the case, where the alignment is off between the two. But also, it's just really helpful to understand, from a purely conversion standpoint, where people are leaving the funnel who maybe in come in via organic or non-attributable methods. The whole point there is just what's causing people to bounce at that particular page or point in the process? Ryan: Yeah, and if you can minimize that friction, then conversions go up. Jon: Exactly. Ryan: And Jon looks even smarter. Dang it. Jon: Well, it's easy when you drive good traffic and you have all these halo effects for me to solve the problems and move forward from there. This has been great, Ryan. Anything else that you wanted to touch on on this that we haven't yet today? Ryan: I just think it's important, if you're going to get more aggressive in shopping, and you also are doing SEO, you have to understand that, okay, the SEO work is probably doing good, but if there's a huge jump it's probably not necessarily 100% attributable to the SEO work being done. That's where this does get really messy. You don't want to stop doing SEO because you're doing shopping stuff, but understand that there's going to be a bump and you're going to enjoy that, but there's a lot of things probably contributing to that. Just be aware that there may be some more analysis needed, but also don't get analysis paralysis. Just understand there's a lot of good things happening. You'll find getting aggressive in Google Shopping, knowing that there are some side benefits that you're getting, that even if you can't put a number on it you know it's going up. So, breaking even on Google Shopping on non-brand searches is never a bad thing if you have some lifetime value and you just want to get market share and be more aggressive than your competitors. Because there's very few companies out there that are willing to consistently break even on some of that traffic. And a lot of companies aren't breaking out brand and non-brand shopping, which still surprises me that companies aren't wanting to do that. If you've got a campaign that is just general shopping and if you can see search queries so that you're not using a smart shopping campaign, you should go in there and see how much of your shopping revenue is actually people looking for your brand. I think too few business owners look at that. If you're getting more of your shopping revenue from brand and that's what's causing the results that you're seeing that are exciting you, you've already done the work for those companies and for those searches. You've got the brand you've built up. You need to separate that goal off on its own and you're not going to be able to set a goal specifically around what do you want to get for your brand search, as far as a return. It's going to fluctuate with things that you can't control from a Google Ads perspective. Google search results pages being tested and changed, competitors coming in and out of the market place. The brand is just going to fluctuate. It's going to be profitable, unless you have an odd brand name that is more like a Kleenex, when people just search for the product you come up because of the way your brand is named. You can be assured that your brand search is going to be profitable. Put them in their own shopping bucket and in the non-brand is really where you set your goal. That's where you decide, hey these people don't know me yet. They're going to find me. If I'm breaking even, if you're in certain competitive industries on Google, baskets, there's a lot of money to be lost on that first order because lifetime value is so high. So, sometimes you may lose money on that first order on non-brand searches, but unless you're tracking that data you won't necessarily know what you could or should be losing to get that customer, what you could be shooting for to get market share. That segmenting is important when you are pushing in shopping and you're doing that because of some of the halo effect. Jon: Yeah. If there's one big lesson I've learned from you recently, and you keep hammering this point home so hopefully everyone else is learning this as well, but it's your goal on spending with ads, it's okay to just break even because of the customer lifetime value you're unlocking there. There's other things besides just return on ad spend or just revenue that comes from that initial order from those ads. There's value in emails. There's value in all these other things that somebody knowing about your brand now and having actually validated your brand by giving you revenue. There's a lot of value here outside of just getting a high return on that ad spend. As much as that should be your goal, it's also okay to buy that first customer by breaking even there. Ryan: Well, yeah. The thing you've talked to me about, enlightened me on, about the post-conversion CROs, things I never thought about. If you're breaking even right before but you've got a great process after the fact to just increase sales immediately after a sale, wow. You've got the halo effect on the front end as well and then you've got additional revenue coming back through a better conversion process to keep that a happy customer. There's just so many wonderful things that happen when you are pushing more traffic as well. Most business owners, I need to tell you and preach to you, don't be timid. Jon: Yeah. Well, Ryan, I definitely feel more comfortable today about knowing half of the money I'm spending on advertising is wasted, but also understanding that I now know that halo effect is helping to ease some of that spend and pretty excited about that. Thanks for walking us through some examples and showing us the value here in doing some of these digital marketing things like Google Shopping, that you might not see a huge return on ad spend immediately, but are increasing your revenue overall. Thanks for your time today, Ryan. Ryan: Oh, yeah. Thanks for the questions.

Google recently dropped all commission fees on their "Buy on Google" platform. On the surface-level this seems like a very intriguing offer. But Ryan here is to explain why "Buy on Google" may not be the best thing for your brand. TRANSCRIPT: Jon: Ryan, a few days ago, I sent you an article I read about Google's Buy on Google program and how they were dropping all commission fees for their sellers as part of the program. Now, to me, this seemed like a pretty good deal. Who doesn't like freeways to sell products and utilize a huge platform with lots of awareness like Google search? At least that was my take, but when I asked you about it, you said, and I'll quote, hopefully this is okay, "That product was dead in the water before this change. Some merchants will of course test it, but it will compete for ad presence with their regular Google ads." Honestly, this was not what I was expecting to hear from you at all. I was really interested in connecting with you a bit more about this and just seeing your thoughts on it and getting some more information about the program out and seeing where and when it makes sense for all of our eCommerce listeners to take advantage of it. I guess just to jump right in, Ryan, on a high level, just so we're on the same page, what exactly is Buy on Google? Ryan: Buy on Google is the little colorful shopping cart icon that shows up in Google shopping. When you start filtering and sorting, you actually transact on Google and then the merchant fulfills it. It's basically a Google trying to be this marketplace saying, "Oh, we can trust Google because I'm buying it here." It's a shopping ad set that you're able to get when you push your inventory into Google and say, "Yes, I'm willing to sell this on Google." Previously, there were commissioned tiers to sell different products. It ranged somewhere from five to, I think, 12%. It was a 12% number that Google [inaudible 00:02:07] because it was less than that Amazon 15%. That came out, man, I want to say maybe three, four years ago, maybe in an alpha-beta four years ago. I think it did cause some Amazon changes within their system on what they were going to be charging to try to have more parody with the Buy on Google scenario. Yeah. It was basically give Google the commission that you would maybe be paying Amazon and we'll push your product out there. There's no advertising costs. Google's the one putting it out there and then you just get the sale and give commission to Google. Jon: They're trying to create a marketplace without really holding any inventory or doing any fulfillment. They literally just take the money, take their cut and send everything over to the retailer? Ryan: Yeah. From a high level, it sounds like a great idea like, "Okay. I have all of this work. I'm spending all this money in Google ads and shopping and I've got agency fees or employee costs or my time in it. Now, I can just go to Google and you're just going to take a commission and it's a fixed cost, so I don't have to worry about what my return on Google shopping is." That theory sounds phenomenal. There's not many business owners are going to be like, "Yeah. Here, take my products. Sell them for me. I now know that I'm only going to be paying 12% of my revenue for my advertising cost." There's no scenario in which that doesn't sound like a good idea. Jon: That definitely makes sense. How does Buy on Google differ from Google Shopping? This is a complete novice asking that question. Ryan: It's part of Google Shopping. You only see the Buy on Google when you're in the Google Shopping tab within Google space. It used to be a little more prevalent on the first page of Google, but I believe it's only showing now in the Google Shopping tab. It's one of the filters you can put on there. Jon: Okay. Then, really Google Shopping is getting your listing of products up there. Some of them will take you to the retailer. Some of them will just take your money on Google. Ryan: Yes. It's always interesting. Google's, as we know, a for profit company. They want to make money. When they came out with this program, it obviously sounded great to business owners, but it immediately put up some flags on our team internally to say, "Okay. Google needs to reward shareholders for their investment and needs to make money to afford employees," and all the things they do around the world that are very good and positive, including paying people. If Google is going to take 12% of the revenue for a sale and not charge for any clicks to the merchant that's selling that, in theory, Google's not going to be willing to lose money by showing those products at 12% when they know from a click cost, they're getting a 20% or a five X return for the merchant. Jon: I see. Yeah. Ryan: Google's got a lot of very smart people and they do say that they are out for the good, and they will do things to just benefit people. Period. There is an opportunity maybe that they're willing to take less money, but that's not always the case. You just have to start investigating. That's why I challenge every merchant to do with any product in Google is test and measure and see if it does actually make sense for your brand. Jon: Spoken after my own heart there, test and measure. Ryan: Yes. Jon: I've had an impact, Ryan. I appreciate it. Let me ask you this then. If they're not doing any commission anymore, then how are they going to make any money and how could any brand really think that Google is going to list this above their ads? Ryan: It's a great question. That's why it's surprising that Google made this move, especially when they just released earnings when we're doing this podcast yesterday where they had the first time that their revenue dropped in a quarter. I don't know how long, if ever, that Google being willing to give up money. When that happens, it's telling us internally logical position that, "Okay. Something wasn't going the direction that Google thought it was going to be going." Either we're in the process potentially of just sunsetting this or moving it to a place where it's not going to be necessarily a focus of Google because if there's no revenue coming in, how are you going to support it internally? You can't dedicate a bunch of employees necessarily longterm to a product that makes no money. It's either a stepping stone into something different, or they're taking steps to buy some market share to a degree and try to get people using it in broad adoption so that they can monetize it later. We don't necessarily know where they're going because they won't necessarily tell us this despite our levels of... I actually asked the question. I was interviewing, I think the global partner strategy person for Shopping. He's a big guy in the Shopping space. We were talking about the free and fast program that's recently come out and I brought it up and he's like, "I answered something, but not how you want it. Then, we can't have this in the interview because I'm not authorized to speak on it." Awesome. Thanks. It's a big unknown. I know that if Google is not making money on it generally, it's not going to be something that I, as a brand, am going to get really excited about and try to push all of my eggs into that basket for my personal brand. I might test it. Again, test and measure, see what it does, but my hopes are not high. Also, my hopes are not high, but just because of the nature of the Buy on Google and the data we've seen in it. A logical position... One of the companies I talk about often, I won't mention them by name, but they started working with us in May of 2020 after they had not been doing any paid search with an agency. They had been using Buy on Google with another agency that recommended that this was the greatest thing for them. This sells B2B kind of like distributor cleaning products, just all things businesses need. They have something in the neighborhood of hundreds of thousands of skews. Most of their sales come from Walmart or Amazon, at least, they did at the time. We looked at Buy on Google and they did about $34,000 a month on average. That was over the previous six months, and they paid Google and this agency somewhere around between four and $5,000 for that batch of sales, $34,000 worth. Jon: It seems like a good [inaudible 00:08:20], if you will? Ryan: Yeah. It wasn't terrible by any means. I said, "Okay. Well, that's not bad, but based on what we see, I believe you're limiting yourself on the potential that our website only did, I believe $16,000 in revenue in the month of April." Their web sales, just if it evaporated tomorrow, not a big deal. I said, "Okay. Look, I think you're being limited here. Give us three months to test this and see what we can do." This was in the very end of April. They said, "Okay. Fine. We're going to fire the agency we've been working with, but it's going to take two weeks. You're going to actually officially be able to kick off mid-May. But in the meantime that first two weeks of May, we're going to just push all our products into the merchant center and flip a very basic shopping campaign on based on just... We don't know anything. We're just going to have the products in there. Just see what happens." I said, "Okay. Great. Can't hurt anything while we're building it out." The data, when we're on a test and measure here, Jon, the data in the month of May, half of this was just that are basic campaign. Half was us getting ramped up. Their sales went from the site in April, $16,000 to $192,000. Jon: Now, that's a return on investment. Ryan: They only spent 2,500 bucks in Shopping in the month of May to generate an additional... What is that? $176,000? The crazy thing we saw and it surprises a lot of companies, but shopping has an effect on lots of areas of your site, not just what you're going to see in analytics on Google Shopping. That $2,500 generated Google Analytics last non-direct attribution, $115,000. The organic traffic on the site went from $10,000 in April to $45,000 in May. They weren't even doing any SEO. There was a halo effect on other things that Google Shopping does because you click to a site on Google Shopping, go back and do more research. Then, you're going to come back through other channels. Direct traffic was way up. Email was way up. Social was even up and they don't even do much on social. The Buy on Google doesn't allow for that because you're buying on Google. You're not even going to the website. You don't have the ability to buy other products. We know as well, based on our research and expertise within the Google Shopping space, over 50% of the time, people click on our product to go to a site and they're going to buy something else entirely. You get to the site and you start shopping. You see the data when somebody interacts with product suggestions on a site, time on site goes up dramatically. Conversion rate goes up on dramatically by clicking that suggested product, or you might also like type products. Everything gets better. They've committed to shopping the site. Maybe you can challenge me in that in some other arena, but all you want is a traffic from Google Shopping to get to the site because everything looks better from an analytics perspective. When you don't have that because of the Buy on Google not sending people to the site, you lose all of that. When I'm seeing Google give something for free, red flags and lights and flashes of all kinds of go off in my head saying, "Okay. Either something wasn't working for Google on this. They just need to get it out there more for adoption to try to take a last gasp for effort, or are they going to try to get companies to forget about sending traffic to the site to try to convince them that Buy on Google is the only thing to be doing?" It's just interesting to say the least. Also, if you have the product in Buy on Google and also in Google Shopping, you don't get to show in both ad sets, so it's not giving you extra inventory. It's a replacement, which also tells me if it's now free, how... Yeah. Google's not bad by any means. I think Google's great company. I'm very honored to be partnered with them at the level we are. I know that they're not going to give up all their revenue from Google Shopping. Jon: Right? Well, there's something else they're getting there in terms of... It's like the old adage about Facebook. If you're not paying for it, you're the product. Ryan: Yeah. Jon: There's something here that makes me think that they're interested in the consumer data. Ryan: Yeah. They want some data, and how much are they willing to pay for that? If they have 100% of all merchants adopt that immediately because it's free, they're not willing to take a $10 billion hit in Q3 probably to see some data. Jon: Not after Q2. Ryan: Because Google already has more data than they know what do it through a degree. Again, interesting. You need to watch it, test and measure it, but often it does not make a lot of sense to utilize the Buy on Google for most eCommerce companies. Jon: Is there anything else you feel like eCommerce brands should know about Buy on Google? Ryan: If you put this on your site and you're also running Google Shopping, we've got some merchants that spend north of $10 million a year on Google. When they came to us, they're shopping... Overall, they were using Buy on Google and Google Shopping and their shopping traffic was down 40% year over year including Buy on Google. Then, they couldn't figure it out. They came to us that find out about this. They had some prior relationships with us from other companies, the eComm team that had started working with them. They brought us on and we were able to uncover that when they had flipped on Buy on Google, that's the key thing that happened to drive the volume down. They thought they were going to be adding ad sets, adding all this additional stuff, and it was going to fix their marketing costs because the numbers looked great. When they flipped it on, everything went down and the agency they had been working with just said, "Well, it's just because the market's down or your prices are too high," or they had all these excuses that just didn't necessarily hold water when we started looking at the data. It's not easy to analyze Buy on Google and what the impact on your business, because the transaction is not happening on your website. You don't see that in Google Analytics. There's a lot of matchup data. There's a lot of filtering and analysis you have to do that is very complex to actually see the impact. When I say test and measure, you're going to actually have to do a lot of work on that measuring to figure out what the impact actually is. You have to look at skew data to see, "Okay. This product, I started showing in Buy on Google. What was the impact of overall sales in taking some of my offline data?" Because the Buy on Google's not going to show up in Analytics. What does that look like? When we put it here, we started seeing what's the impressions of Google Shopping that I lost? If I lost again, easy math, a thousand impressions and 10 sales on Google Shopping when I flipped on the Buy on Google, did I get more than 10 purchases of that specific product? Probably need more than that because the halo effect of Google Shopping of my organic traffic getting more searches and clicks and purchases because of my shopping investment, that goes away. You got to take in the fact, the halo effect. Go in paranoid like I do with most things. I'll go in paranoid to start and say, "Okay. If my business is not going to go to the direction I want to, where am I going to see it? What levers am I going to need to push and pull quickly and uncover some changes?" Jon: Is that paranoid why you live on a farm and all that acreage? Ryan: No. I also have four small kids and you need room to run. We're very blessed in COVID time to have all that room. Jon: You had said at some point, as we were having this conversation a few days ago, that larger merchants will usually lose volume when they have both ads and shopping actions. Is that summarizing what you were talking about a second ago? Ryan: Generally, yeah. It's simply because you can't show both ad sets. Playing out the conspiracy theorist in me saying, "Okay. Google's... Previously, they were going to get 12% from your Buy on Google, but they knew they were getting 20% with people clicking on ads to your site, they're probably going to take the 20% margin that they were getting on click and not show the Buy on Google." Buy on Google, you don't get any search queries, so we don't actually know what you were showing for. What we were seeing often was that it was cannibalizing brand terms and taking some of the easy stuff that you were probably getting at less than 12% cost already. Not that it's bad, but even smart shopping to a degree, take some of those easy layup searches and shows a pretty strong ROI. But a lot of that was brand that maybe you could have been getting a better return on ad spend with a more complex shopping structure. That's where you can't see the data from a search query perspective, so you have to see it from a transaction perspective. You're never going to get really apples to apples, but when you're comparing it volume loss of sales or volume increase based on skew, you'll want to hopefully have a lot of that data you can be pulling. If you have smart campaigns running currently on Shopping, you're probably not a large merchant. If you are a large merchant, we should chat. Smart campaigns are quite limiting to your scale, but if you have smart shopping and then you do Buy on Google as well, you have zero data in both of those. You're just going to be able to measure total site sales and maybe they do increase, but could they have gone higher if you went just to a manual shopping campaign structure and didn't do either smart shopping or Buy on Google. It's a difficult analysis, but it's something that all brands spending over 10,000 a month on Google should probably be doing. If you're doing spending money on Google Shopping and also doing Buy on Google, you need to be doing some deep analysis of what that looks like because I would venture, I guess when you flipped Buy on Google on, you probably lost some volume because of that transit. People not being able to shop the site and add different complimentary products. Jon: Right. Ryan: Buy on Google doesn't do that. They don't know what the complimentary products would be, but if you work with Jon who's going to help you figure out some of those things that are going to help your conversion rate to help your AOV, you can only do that on your site. Jon: Right. Yeah. That's been my rub with Google Shopping and I guess Buy on Google, more specifically is that you have very little control and you lose the contact information for the buyer. This leads me to my next question, which was I had mentioned there was an article in Forbes that kick started this whole conversation. That article says something along the lines of Google just updates eCommerce game to attract more sellers, but it's still not enough to compete with Amazon. What stuck out there was not that it's not enough to compete with Amazon, but this has been viewed as a play to compete with Amazon. Do you agree that this is a play to compete with Amazon? Ryan: Well, Google and Amazon has been competing for over a decade. I don't think it's a new thing for Google to try to test waters to create more of a marketplace. It just makes sense. With over 50% of all eComm transactions happening on Amazon, there is a risk to Google on ads that people could be just moving stores to Amazon and not paying for traffic on Google. That is a potential that Google is probably well aware of, probably not giving them any insight they don't already have. Jon: But I was wondering with that approach also, they're willing to offer this for free almost as like gut punch to Amazon in that, "Hey, we'll keep the customer data and the sale. We'll give that commission up to increase the volume and steal basically the revenue away from Amazon," almost as a way as a retaliation. I'm sure Google would never say this, but for Amazon launching on platform ads, which kind of hurt... I'm sure hurt some volume on Google. Ryan: I don't necessarily think that if you are selling online, you're not aware of Google or this was what was going to all of a sudden, get you to start working with Google to a degree. I think that there is some of that there like, "Hey, we want to try to get more merchants and more data," but I don't think that that was necessarily the play for Google that they're trying to use this to be the marketplace or take down Amazon at all. Then, probably trying to get new data to see, "Oh, if it is free, what is that doing to our margin? What is that doing to the volume of people buying on Google? Does that give us the ability to push into a marketplace?" The fact that they're integrating with PayPal, the fact they're integrating with Shopify Pay is pretty big. Letting people pay with those things, so it does seem that there is a marketplace potential here and it may be if we play this out, I'm guessing that Google is taking some margin from PayPal and Shopify Pay if people are using those for the transaction. Jon: I see. Ryan: Google's Pay could be as a merchant processor at the end of the day because they already have Google Pay. If they're making enough money on the processing fees, maybe they don't need to charge for a marketplace listing. Jon: That's a great way. I hadn't thought about that, but that's a great way for them to increase the volume there, which probably makes their cost cheaper to process those overall because of the larger volumes. Yeah. That's a great idea there in terms of how this makes sense for them. That leads me to my next thought, which is that Google has really tried several ways to take a piece of the eCommerce pie in the past few years. Right? We talked about Google Pay for instance, right? But I don't see a whole lot of eCommerce brands taking advantage of it or really making it a priority to support all these things. Do you have a feeling that Google will ever become a really large player in the actual eCommerce space besides driving traffic? Ryan: I would never bet against Google. Jon: That's fair. Ryan: They have a tremendous amount of intelligent people and more data in the eCommerce space than almost any other company [inaudible 00:22:14] in Amazon just control it. I think there's so much value to owning the customer experience for brands that as a brand owner myself, I do have an Amazon storefront. I do advertise on Google. I do have my own website. I look at Amazon as a retailer because it's their customer. It's not a me customer. For me, the more people that I can get my product into their hands through Amazon, the more likely they are to become a loyal advocate brand fan for my brand and maybe they'll buy from my site. Maybe they'll follow me on social and I can get new products into them, but I know it's Amazon's customer and Google can send traffic to my site. I have a lot of affinity for that because they're willing to share all of that customer data with me and not own it. It's difficult for me to be able to give up my customer and sacrifice that data and potential relationship and experience that I know I want my customer to have on my site to ever be like, "Okay. I'll never drive traffic to my site. I'll just let the transaction happen all over the place with everybody else's system." Jon: Government antitrust interviewing aside with all these big tech companies recently. I've always wondered why Google didn't just buy Shopify before it went public or by big commerce before it goes public. I could see a massive antitrust issue there perhaps where they own the entire ecosystem, but I also think that for them to really get a piece of this pie in the longterm in terms of on the transaction side, I almost see that that's going to have to be a requirement and we'll see what happens, but it would be interesting for them to take a play there. Ryan: Yeah. I think it's going to be easier for a Shopify to move into a marketplace than it is for Google to move into a web ecosystem that you can't get out of, but there's potential that Amazon gets broken up. As big as it is, maybe they have to uncouple their fulfillment and let everybody on the planet use Amazon fulfillment or Amazon becomes just the marketplace. I foresee that as potential. I know that Shopify is moving into logistics. They're going to start fulfilling orders for their merchants. There's a lot of frenemies in the digital marketing space. You and I partner with companies that we technically can compete with on certain areas as well. It's not uncommon and it's going to be to fascinating next few years to see how a lot of this is going to shake out. Jon: Yeah. Not really on topic, but I do see that if Shopify starts fulfilling, that's a huge win for Amazon because they can go back and say, "Well, we're not on it. There's no antitrust issues here," that Shopify fulfills and they do two days. Walmart now does one day. What's the problem? You could definitely see that argument. Ryan: Yeah. I think Walmart, we need... I didn't mention. You brought up Walmart. I think they have more distribution than even Amazon. Amazon has for their FDA, I think something in the neighborhood of 77 locations around the country. Walmart's got, I don't know how many thousands of stores, but a lot of them and Shopify has all this data around all of these merchants that a lot of them sell the same thing. If you've got the same skew at Shopify system, they know where you're located. They know where you're shipping from. In theory, Shopify could start selling that particular product and saying, "Hey, merchant X, Y, Z, you have it listed for 50. We know that we can sell it for 45. Do you want to take 45 and ship it to somebody?" Yeah. Most merchants are going to be like, "Yeah. I'll take that. You're going to share this customer data with me." Kind of like the dealer network. Do you remember Shopatron? I think it's now Kibo or something like that. The dealer or the manufacturer sells it and the dealer fulfills it. That's for sure within the realm of possibility within the next couple of years. Jon: Yeah. Wow. This has been fascinating. Thank you once again for educating me on this. You're always so knowledgeable on what's happening in the Google ecosystem, not only because you guys are such great partners with them at that scale, but also that you dive really deep into this personally as a store owner and somebody who helps clients. I really appreciate your time on this today and looking forward to the next conversation, Ryan. Ryan: Yeah. Me too. Thanks, Jon. I appreciate the time and the good questions.

How can you prepare your businesses for operating in a future that has yet to be determined? Today, Jon explores the future of CRO. With such a high volume of transactions happening on Amazon and Shopify are we nearing the end of incremental improvement from CRO? For help with your CRO visit: https://thegood.com/ TRANSCRIPT Ryan: All right, Jon, as a business owner and strategist, I'm constantly thinking about the future and how I can prepare my businesses, my teams, clients for operating in a future that has yet to be determined. For me, it's just kind of fun to think through. Recently, one of the things that's been on the top of my mind has been the future of CRO and how do we continue moving the needle to improve our sites, but doing that like five years in the future, what is that going to look like? With such a high volume of transactions happening on Amazon and Shopify, are we nearing the end of incremental improvements in CRO? That's kind of the thought that's going through, and I guarantee you have some serious opinions on this that I have no idea about. So I'm excited to learn from you what you're looking for in the future. But it also came top of mind because of a recent Google announcement that they're going to start including site experience into their organic algorithm. And so let's just start with that. Based on what you've heard and what you know about Google, what do you expect this to look like when it rolls out? Jon: Well, I think that the biggest concern for brands and the biggest concern they should have is that if you haven't been optimizing your site's consumer experience, it's going to severely impact your rankings, and thus your organic traffic is going to go way down. Google was kind enough to tell us now, even though it's not going to roll out until 2021. So we're recording in mid 2020. So they have given you a six months heads up, which is very nice of them. They also have provided all the tools you need to be able to improve your site experience, including one of my favorites, Google Optimize, which is their A/B and multivariate testing tool set that they've released that's great. So they're not only just giving you the tool sets, but they're also giving you the guidance on the fact that they want you to have a really great consumer experience. Say when they go to Google and search, and then they end up on your site, that they have a great experience and that they love the search results that Google is producing. So that's what Google cares about right now, is they're saying, yes, everybody knows if I need an answer, I can go to Google. But a lot of those sites that rank first have made the experience so poor in an effort to get listed higher that they don't have a good experience on those search result pages. Ryan: How much in your opinion, and maybe you can assign a percentage, is the actual act of converting on a site the experience? Can you break that out into its own piece, you think? Jon: Well, without question, I think Google has been very upfront about this. Normally they'd never release a specific percentage that anything weighs into that algorithm, but they are saying that it's going to be one of the top factors. Ryan: Is the rate of conversion on a site? Jon: They can track conversion to some degree, but I think what they're looking at is how long are people staying on your site? How many pages are they looking at? Are they converting is definitely a factor in there, but are they bouncing right back to Google? And I think they're looking at a lot of other metrics too. They're looking at page speed. They have a whole bunch of algorithms and artificial intelligence, AI, that has gotten really, really good at telling things like, do you have a popup on your site where it, as content loads on the screen, that popup kind of moves around a little bit, and just because the page loads slowly and you have this bad user experience, and now people are trying to click buttons and the button keeps moving as the page loads. Ryan: I hate that. Jon: Exactly. That's the thing that Google does not want, that experience, what you just had, that emotional reaction. If you had clicked on the first item in a search engine result page, and you went to a site, and you had that reaction on that site, Google now knows that that's what's happening, based on their AI, because they can test for those type of experiences. And so really what they're advocating for here is the consumer experience on your site, the user experience. And they're asking you to make sure that you have a consumer friendly experience. And I think that's really what's going to matter. Now, the outcome of that is naturally going to be higher conversion rates. So I've always been a proponent with CRO that says the goal of the brand is to convert higher, almost always, right? The goal of the consumer is to have a better experience. Those are actually very much aligned, because if you have a better experience, you're going to convert more. And I think Google is recognizing that now, too. Ryan: You could take the stance of maybe some of the conspiracy theorists out there, that a higher converting website in the eCommerce space could hurt Google's revenue, since people don't have to go back to Google to keep researching. They're just going to find it, buy it, kind of like how I usually convert, versus my wife, who's all over the place in her conversion path. What would you say to those conspiracy theorists? Jon: Well, I don't think it's a conspiracy. I think it's, you know, Google's pretty upfront how they make their money. It's what the ads on the search engine result pages for the vast majority of their revenue. So yeah, they want people to keep coming back to Google, but I can promise you that if I keep searching Google and I keep getting a search engine result as the first second, third, which are the only ones people are really clicking on for the vast majority of times, and the experience is crappy, I'm going to stop going to Google. So they must know, because they've factored this in as one of the top ranking items in their algorithm, they must know that this is causing a concern, and they're feeling a lot of pressure from tons of other search engines out there right now. I mean, you've probably heard of, what is it, DuckDuckGo. There's all of these other search engines that are way more privacy focused right now. Windows, any Windows laptop comes with Bing as the default search engine, Microsoft search or whatever they're calling it these days. So I think they're feeling that pressure of making sure that people have a great experience, so they continue to come back and search on Google. That's why they're making it such an important factor. Will it cost them some money? I don't know. I think they must've done that math, but I will tell you that I'm excited that this is new and that they're making a big stance for this, because it's needed. It's really needed. Ryan: Speaking of competitors to Google, Amazon controls over 50% of the online transactions in the world. And how much in the future do you think Amazon is going to impact the way we view a checkout or a conversion process? If we play it out, say, let's just say Amazon is going to continue increasing in dominance. You can't do much with their checkout. So are we going to be so conditioned as Amazon Prime members that anything that deviates from Amazon's checkout process is going to throw us for a loop, and we're not going to know what to do? Kind of like the idiocracy model, where we just get dumber, because it's so simple for us? Jon: Well, I think that's the internet. The evolution of the internet has been that way for years. And I think we did a prior episode where we talked all about how eventually what's going to happen, are we going to totally optimize ourselves out of optimization, right? You're going to have done so much optimization that every experience is going to be the same. And I don't think that's going to happen. But I do think, I mention this book all the time, it's called Don't Make Me Think. And the whole point of that is that as consumers get used to conventions, it makes it easier for them if you follow those conventions. It's so true today that people are used to Amazon checkout. They're used to the Shopify checkout. They're used to these platforms that have grown to be the monsters in this space. And if you really deviate from those best practices, then you are potentially creating a barrier. Now, that doesn't mean there aren't areas that can be optimized in those. There most certainly are. But at the same time, looking at Amazon as an example, in terms of how to convert better and not just on the checkout, I think Amazon does a lot of nice things. But you know what? It's akin to when a small footwear brand comes to work with The Good, and they say, "I really like what Nike is doing. I want to do what Nike does. Can you help me do that?" And I say, "Well, but you're not Nike. Think about this. Nike has hundreds of product lines across all these different sports. Their marketing is based on the celebrity of getting athletes to market for them. And you don't have the money to go out and get LeBron James to market your shoe. You are fighting a 10,000 pound gorilla here, trying to fight a gorilla fight when you're not a gorilla. So think about having the better consumer experience." Nike can get away with having a worse consumer experience because of how ubiquitous their brand is. It's the same thing with Amazon. I go to Amazon to buy something because I know they're going to probably have what I want. And it's a quick and easy way to just go there, type in what I'm looking for, get a handful of options, do some research, and buy something at a decent price point. And I know I can get it in a couple of days. But if I really want to find a particular item, I don't go to Amazon to buy that particular item. I'll go to the brand website to do that research, because I know in my research it's going to get way, way deeper, even though maybe the consumer experience isn't going to be as good. Maybe I won't get it in two days. However, I know that I'm going to have more content and I'm going to have a better research path on that brand site than I will on Amazon. Amazon is great for not going very deep, but going very wide. Looking at tons of different products, but not going very deep into the research on each of those individual products. And a brand site is different. It's going to help me go real deep on products, but not very wide on competitors. So I think they serve different purposes. And it depends on if I'm looking for a commodity, right? Like, I was looking at ethernet cables yesterday. I needed a 50 foot ethernet cable. I just ordered it off Amazon, because it doesn't matter. It's a commodity. I can get an ethernet cable anywhere. But I know I can get it in two days. I needed it quickly. In fact, they dropped it off the next day and it said, have it by next day. And I was like, perfect. That's what I need. So I didn't even look anywhere else at price. It was fine. It was like a $10, $15 cable. It's not going to break the bank to do that. If I saved two bucks going someplace else, it didn't matter to me. But I think that's where Amazon has its place. And I don't want people to get confused by thinking we have to meet Amazon's experience, because they're doing a lot of things that I would not recommend and do not test well. Their navigation is a mess, but it's like walking into one store, in a retail store, versus walking into your local mall that has hundreds of stores. And Amazon is trying to be that mall, when you're trying to just be the retailer. And you really need to take that approach a little differently. Ryan: Looking forward a couple of years, and maybe the physical checkout process on a site is pretty standard across a lot of things. I mean, there's Bolt right now. There's even Shopify checkout that's been very simplified. So CRO, I would assume over the last five to 10 years that you've been doing it, you've had to educate some people on just the basics of checkout. Like, why are you doing checkout this way? So if that goes away, it sounds like you're saying CRO becomes more of a brand experience on your side rather than, okay, you changed your checkout button from pink to purple, and then look at that [inaudible 00:12:29] type thing. Jon: Right. I mean, look, I think CRO has evolved over the past, we've been doing this 11 years now, but over the past five years, it's become something that most people know about. If you're on the eComm side of any reasonable size, you're looking at and doing some CRO. I think the biggest difference here is that you're right, that there are areas that are transactional that just need to be transactional. And then there's areas of a site that are going to have a better consumer experience, that are going to then reflect better on the brand. And I think that's what you mean by branded experience, where if I go to a site and I just have a poor experience, then I am at that point going to have a bad reflection of the brand. And I think that's exactly what Google is trying to prevent here, is saying that you need to have a good reflection of your brand so that people don't just equate that Google, where you started, gave you a bad experience, as well, by sending you someplace that has a bad experience. Ryan: Got it. Okay. So if you're looking five years into the future and making some crazy predictions or looking at, what are you preparing your agency, The Good, for in the CRO space? What are you maybe not doing now that you think you will be doing in CRO in five years? Jon: I think that what needs to be happening is a way to make this more accessible to brands of all sizes, first of all. I think CRO, just like most technologies and consulting and things of that sort, it's for the elite when it starts. You have to be able to afford it. It's a competitive advantage. And so you're looking at the top one percent is able to take advantage of it. Then it starts filtering down. And that's what we've seen over the past five, six years, has been really the first five years that we did CRO, it was only for massive brands. And then it started getting to the point where those mid market brands really knew it was something they needed to do, and it became more available, and the tool sets got more available. We went from having just Optimizely, which is a great platform, but it's $10,000 a month to use, just the platform, to having Visual Website Optimizer, which was a couple hundred dollars a month, to now we're at Google Optimize, which is just as good as VWO, and it's free from Google. We've kind of run that whole gamut, and each of those tools have their space, don't get me wrong, and they're good at individual items. But my point here is we've gone from $10,000 a month to free over a span of a few years, and I think we're going to see that democratization of CRO continue to happen. So what needs to happen is that it needs to have these methodologies, and the strategy behind them need to catch up with the tool sets and need to be accessible to brands of all sizes. And right now that's not the case. The only things that are out there are eLearning, where you as a small eComm owner, and you're wearing tons of hats, you don't have time to sit down and learn for 25 hours and watch videos and then figure out how the heck do I apply this to my site specifically, and pick and choose, and then still act on it, right? So you've invested all this time and you still haven't made any changes to your site. So there's some ways to fix that, and we're working on that at The Good, but really I think that democratization of CRO is where this needs to go. And I think in addition to that, I think we're really going to see tool sets continue to evolve, and I think AI is going to play an even bigger role. As you know, we've been proponents of that for years. We do AI eye tracking heat maps, which is our way of dipping our toe into that. And we've been tracking it for years, and looking and testing at those algorithms to the point where we wanted to make sure it was something that worked before we heavily invest in it. And we're ready to heavily invest in it and go all in. Being a data driven company, we're seeing a lot of artificial intelligence with big data sets really start to pay off and make this successful to brands of all sizes. Ryan: That's [inaudible 00:16:46]. I think that is going to be phenomenal, when these small companies that we know of that need the CRO services are able to get those at a point that makes sense for them financially and for the improvements that'll make. That'll be cool. Okay, here's a fun one. Besides the death of the email capture pop up that you're so advocating for and the death of Wheelio spin-to-win, do you see something that we all currently expect on an eCommerce site to not be a part of an eCommerce site in the next two or three years? Jon: Yeah. I think putting your credit card in is going to go away. I mean, I don't know about you, but I'm fully in on the Apple ecosystem. And if other ecosystems catch up with this, I know Google has done a lot with this, with Google Pay, but Apple Pay, I will now, if I'm searching online to buy something, I will use Safari just so that on my phone or even on my laptop, I can just do Apple Pay and not have to go get my wallet. I don't want to have to memorize my credit card. I don't want to have to deal with any of that. And in fact, it's just like retail. If I have the option to use Apple Pay and not touch anything and not give somebody my credit card to swipe or even have to touch the screen to do it myself, I will do that. And I use Apple Pay every single time. I was even in a drive thru getting food the other day and I used Apple Pay, and it's just like that's my first question anymore. It's like, do you take Apple Pay, because I don't want to touch anything. And it's so convenient. So same thing online. Everyone expects to have to put in their credit card. I think we're going to see that go away. Shopify has taken a big leap in that direction, by making it, you can put in your phone number and then it will auto fill out your information. It'll send you a text and confirm, and then you can auto fill all your information in. I think there's a lot of things like that that are going to start happening, just as a way to make this process way easier. Ryan: Yeah. I'm excited for that. It's during this pandemic, where we're not going into an office or commuting, I found that I don't have my wallet on me. And so when I'm off somewhere else on our property and I want to transact, I don't want to go get my wallet. So if it already has my information, I'm more than likely to go to that site, and I may pay an extra dollar. But for me, it's like, nah, it would have cost me 10 minutes of walking somewhere on my big property. So I'll pay the premium to use, so that it's already stored. Jon: That's exactly it. Ryan: I didn't even think about that, but that's very true. I may be lazy sometimes. Okay. Jon: Sometimes. We'll leave it at that. Ryan: Sometimes. Yes, sometimes. Is there something out there that you see that if just something on an eCommerce site that if a brand adopted it now, they would have a pretty significant advantage over competitors in the next couple of years, if they really took a leap of faith? Outside of using our services, because we're so amazing, what would that look like, do you think, if you had to pick one thing? It's like, yeah, most people aren't using this yet, but I think if they do, they're going to have a big advantage in a couple of years. Jon: I think that it's not just one tool, and I don't even want to go to a hundred percent to tools, because I think that's the first spot that every eComm owner looks to, is like what's the new greatest and hottest tool that I can deploy on my site and be ahead of everybody else on that? A tool is only going to do one of two things. It's either going to help you do something better, or it's going to expose a weakness. And what we see is a lot of brands jumping into tools. And what I would like to see these brands doing is using tools like Klaviyo, for instance, to do email followups post purchase. We have a whole episode, go back and look for post purchase emails and what people should do for post purchase optimization. I talk about all the different email flows that you should be thinking about post purchase, and there's so many things like that that brands right now just aren't doing. And I'm not a big proponent of just having a best practice checklist, but I will tell you, there are a bunch of items that when we jump into work with a brand, we just immediately look at and evaluate and figure out what are the top opportunity areas here. And I'm always surprised, no matter what the size of the brand is, that there's almost always things on that list. And one of them is, as I mentioned, post purchase followups. One is definitely the checkout. Are they optimized around that? You mentioned Bolt and Shopify and things like that. And I think there's a lot of great optimization happening in check out right now. I think there's also a lot of optimization that can be happening in just assets on the site. What do I mean by that? Well, like product photos. You and I have talked a lot about 360 photos, and the revolution that's coming with that, in the past. And I think that that's, you know, having better product photos as more people are going online to purchase, is really going to matter, because you can't touch a product right now. So making sure that you have a way to see every angle, to really understand what you're buying, is going to be really important. And I think reviews and social proof is a huge one that people miss out on. And I'd be shocked if more brands don't do that in the future, because there are right and wrong ways to do that. But it is something that if you don't have reviews on your site, people start getting suspect about trust. They don't trust your brand as much. They're wondering why you're not sharing reviews or collecting them. And we've seen time and again, consumers trust what other consumers have to say more than what a brand has to say. Ryan: That's awesome. So thank you for all of that information. That definitely got my mind going, and some of my brands and what I should be doing that I'm probably not, because I'm stuck in the minutiae of the business myself. So thank you for all those insights of what we're going to be looking for in the future of CRO. Any parting thoughts or words on the future of CRO? Jon: Well, I think the best way to stay ahead of the curve is to start tracking your data today. Understand how people are engaging with your site. Make sure you're tracking every click and movement. And if you do that now, no matter what tool you deploy, no matter what you start doing down the line, you will have more data to make informed decisions, because you're going to have a longer timeline to look at trends. You're going to have a longer timeline of data to look at what potential changes you made and when, and what the impact of those were, so that you can skip having to collect all that data and wait around before you can take action. Because the biggest issue I see with brands who aren't collecting data when we start working with them, is they start getting anxious, because they say, "Hey, we're just sitting and waiting right now." And I said, "Yeah, we need to get all this data that you weren't collecting forever, so we can make informed decisions. And then we can act." So it's this whole issue of eComm brands who come to the table ready to act, but then they don't have the information or data to do it, and then they get anxious because they were so ready to act. They made the decision to act, but then they can't do anything yet. And so they have to fill that gap somehow. And I think that's a big concern for eComm brands, and I think we're going to see more and more brands collecting data. And I think it's becoming a lot more popular and easy. The tool sets are so easy right now. But just get some data collecting every click and movement. Set up Hotjar and just let it run. Even if you can't do much else, just set up heat maps and let them run for a while. Do some session recordings and let them sit there. Google analytics, of course, but there's even tools like Glew, G-L-E-W, that is amazing for helping you understand your consumer audiences. All of that data is really going to be important. So that's what I would recommend. If you want to be able to take advantage of what's coming down the line in the future, start collecting data today. Ryan: You heard it here first. Jon Macdonald says collect data. Do it. Thanks, Jon. Appreciate your time. Jon: Thanks, Ryan.

Today, Jon asks how to determine what your SEM budget should be...and Ryan explains why the answer may actually be to have no budget at all For all your digital marketing needs: https://www.logicalposition.com/ TRANSCRIPT: Jon: It's a common question that I hear quite a bit. "How much should I be budgeting for search engine marketing and how do I even forecast what I should be spending?" Well, securing the SEM budgets is always a challenge, right? So when you do spend on search engine marketing, you want to ensure that you reach your performance goals, but there are countless traps and ways to actually overspend or even underspend on your search engine marketing budget. And even if you follow all the best practices, you could still end up with some inefficiencies, so correctly addressing the ways to misspend requires paid search experts to consistently monitor campaign performance and budget spend. And also they need to have a pulse on what the company is trying to accomplish. So luckily for us, we have access to Ryan and he has access to 6,500 search engine marketing budgets to learn from. So today we're going to talk about ad word budgets and how to forecast what your brand should be spending and how to ensure you don't overspend or underspend. So, Ryan welcome. Ryan: Thanks, Jon. It's a big one. This topic is constantly top of mind for CFOs and there's constant tension, I think, between marketing teams and finance teams over budgets. And for me personally, it's one of my favorite topics and also my least favorite topics, just because of all the tension around it. It's my favorite because almost every company needs to be educated in how to forecast and plan budgets. But it's also my least favorite because it's always an uphill battle with changing the opinions of business owners, executives, finance teams, even marketing teams that don't understand forecasting and budgeting. It's a difficult conversation to have, but I'm happy we're going to be diving into this and hopefully doing some education. Hopefully making people think about what they're doing and how they can be maybe looking at SEM forecasting a little bit differently. Jon: Awesome. Well, I'm looking forward to being educated on this. This is a topic that we were chatting before we started recording, and you have some unique perspectives on this that I've never even given thought to. So. Ryan: We both have [inaudible 00:02:32] all kinds of things, Jon. It's great to be able to do this with you, but when this topic came up in our sequence of things we're going to be talking about it. I get all hot and bothered and excited and adrenaline starts flowing and I talk fast. So bear with me, but very similar to how you get when somebody's got a discount email pop up on a site is how I get when somebody tells me what their budget is X number of dollars a month. And don't overspend. It's just, I'm on a personal mission to eliminate SCM budgeting for 99.9% of the population. It just doesn't make sense for most companies. Jon: So explain that to me, I'm interested to learn more. Why is that? Well, Ryan: we get into the conversation because finance people want to see what numbers are going to be and understanding what's going to be coming in and out of accounts. And so it's for the last a hundred years of CFO's doing work to prepare bank accounts. Marketing has been a line item on the P and L that they've paid attention to and set goals around on how much are we going to spend? What are we going to do? How much are we putting into magazines and newspapers and TV ads and billboards? So it's understandable, but SEM is in a very unique position that it's not a normal P and L line item. Let me just use an example because here's what normally happens. Finance meeting, all right, the owner is, "What the heck," gets all red in the face. "What the heck is this $350,000 charge for Google last month? You know, we need to cut that down because our retailers are selling less of our product. We need to save money. And you know, if we go into a COVID time, we've got to control all of our money and keep it from going out so we're not spending $350,000 on Google anymore. Every month, a marketing team, we need to cut a hundred thousand dollars of that." Marketing team reaches out to the logical position says, "Hey, yeah, our wholesale channel is down because nobody's shopping in stores. So we need to cut a hundred thousand dollars of our marketing budget on Google." And that I get it, logically it passes the make sense test that you're going to take that hundred thousand dollars from Google and move it to the bottom line of profit. So you can cover the missing profit from some retailers that aren't selling product. Jon: Right. They're looking at it purely as an expense line item. Ryan: Exactly. Which again, conceptually makes sense. What isn't considered in that is that $350,000 drove 1.3 million of top line revenue, 10,000 new to brand customers, and also had an impact on two million organic direct traffic revenue. And so cutting that hundred thousand dollars, most likely won't even save that company money. It'll probably cost them revenue and profit because it's not going to be driving as much top line revenue. And many times in the past, if you cut a hundred thousand dollars of billboards, you may not actually feel an impact in the business at all over the next month, depending on what you're selling, depending on what the billboard's mentioning, but it simply does move that hundred thousand dollars to the bottom line. And that again, logically makes sense. But with SEM, it doesn't operate like a historical marketing channel. It is driving so many other things that impact the business. And so because of that, it is somewhat complicated to explain that to a business owner over a phone call or, "Hey, we've got five minutes with the exec team. Let's tell them why we need to be spending on SEM." For most businesses, I'll add, will start with the crazy notion that you should not have a budget for paid search. It should be, "Nope. You are going to set your goals and going to spend. And if you can spend more, you are going to take it if you're hitting your goals." Jon: Okay. So it's not an expense line item. It's an investment. Ryan: Yeah. Jon: Okay. Ryan: If you're printing money with an investment, is there any reason you wouldn't continue printing money? And the general answer is, "Well, no, if I put a dollar in and I get $10 back, I'm going to go find a bunch more dollars. There's no limit to the number of dollars I can be spending. Because I could take that $10 that I just printed and put it back in and it prints a hundred and I take it out and it prints a thousand." The asterisk to this, which we will touch on probably a little later is it does make sense to forecast sales from SEM, potentially based on historical data for inventory or production. And that's where it does get kind of like a sliding scale on what we can spend based on the inventory we have. And I've got a couple of examples on that. Jon: So if you're not budgeting the spend, should you be looking at the back end is what you're saying. You should be budgeting the return on that adspend and what that's going to be in revenue. So you're saying, "I want to make a million dollars. What does the adspend take to hit a million dollars?" Ryan: Maybe? But the reality is, is I challenge companies to, yes, you're going to look at this, after the fact on a PNL, as a line item, but in the month itself, the spend on SEM actually doesn't have an impact on cash. Therefore it's not necessarily a normal P and L line item. So easy math example, you're going to spend a hundred dollars on paid search on Monday. Great. You set up your Google Ads account. You've got your credit card on there. You spend a hundred dollars on your credit card on Google. It drives $500 of revenue. Okay? That hundred dollars that you spent on Google Ads doesn't even hit your card until you spend 500. So it's still just in Google system. You spent in essence, at that point, fake money, it didn't hit anything. It's just a Google system, but that $500 that you processed on your website is real money. And that's going to hit your account as soon as your merchant processor will send it to you. So let's just say easy math. It's going to hit you on Wednesday 48 hours later. So every day you're going to spend a hundred dollars to get 500, your credit card's not going to get built from Google until end of day Friday, when you hit the $500 billing threshold from Google. And by that time you've already collected $500 on Wednesday, $500 on Thursday, $500 on Friday, that's hit your bank account minus the processing fee. But we will ignore that for this example, you've got $1,500 in your bank account. Your credit card has only been hit for $500. If you are like me and you're [inaudible 00:08:29] this, I pay my credit card once a month. And I pay off the entire balance on ever pay interest. And that credit card bill is probably not due until the 14th of the next month. Let's say this was the first of the month. So you've got 45 day float on that hundred dollars you spent on Monday. And by that time you've already collected money. And if you're not losing money, which ideally you're not, but you're actually making money, then it's a money printing machine that actually doesn't cost you any money. You have, in theory, an unlimited amount of money, as long as you're at least breaking even just from a cash perspective, right? And your credit card limit, obviously. Jon: So it's no longer about SEM budget forecasting. It's around the laws of SEM cash flow. Ryan: Not every business has unlimited inventory. So you might be able to spend a hundred thousand dollars tomorrow to generate a hundred thousand and $1 of profit in your business. But if you don't have the inventory to back that up, then you do have problems. And we have some clients right now that are struggling to get inventory from China for their production. I think one company has a hundred containers en route from China they're just waiting on to be able to sell and they can flip a switch, and that inventory is almost going to be gone immediately. It's crazy, the demand for their products. So from that perspective saying, "All right, we have this much inventory coming. We want to sell it." And maybe that becomes the conversation around, okay. Based on the historical data of what we've been able to sell, what we've been able to spend, what's the return on adspend goal that we need to be at to sell that much inventory? So again, this is getting somewhat complicated math, but I'll try to boil it down simple. Let's say in my brands, for example, I will spend down to break even to acquire a new customer at any point in time, because I'm competitive. I would love to put my competitors out of business because I think my product is better. My service is better, but break even is fine for me because it doesn't hit the cash. I'm getting new customers. And I have a lifetime value. If, for example, I all of a sudden had a... And this happened, I think in April we had a production hiccup. And so I knew that I was going to run out of inventory if I kept spending down to break even on like, let's make it up the 20th of April. So I said, "Okay, all right, marketing, we're actually going to raise our return on adspend goal because I need to throttle down sales because I can't run out of inventory on the 20th. I have to be able to get to the 30th before I can get my inventory back in." And so that's the strategy I use. I didn't care what we spent, as long as it wasn't losing money. I still, I said, "All right, instead of breaking even, and we're going to get a 2.5 X because based on the historical data, we think that's where my sales special is going to be." So that took some guessing and manipulation on daily sales totals. And we had to watch it pretty carefully. But once we hit inventory levels again, I was right back to pushing aggressively to sell an inventory. Jon: Yeah, that definitely makes sense. So there's other factors you need to be thinking about here and inventory sounds like is a big one for sure. Then that could be the more delimiter than what you should be spending or what the budget would be for SEM. Jon: Let me ask you this as a little divergence, but how do you get leadership on board with this type of mindset? Right? Because if you go in most financial folks would probably understand that return on investment spend, but maybe if leadership and finance is still looking at all of this as a budget line item, that's only on the expense column. How do you recommend people approach this conversation? Obviously there's simple math, just like writing it out, might help, but have you have found any tips and tricks for how to approach leadership about something like this? Ryan: It's difficult again, going into this conversation about money is always... I don't think there's any conversation around money that becomes easy, except, "Hey, I want to give you a million dollars." That's pretty easy. I'd be like, "Yeah. Okay, great. I'm in." The longer an organization has been looking at marketing on Google or Microsoft Ads as a line item that they forecast and budget annually, the more difficult it's going to be to change the minds of the team that's been doing that. We've worked in some billion dollar organizations that said, "All right, last year we did X number of dollars on our website and we expect a 10% growth. Therefore we're going to take our marketing budget for paid search, which was 10% of that total. And then we're going to add 10% to it again. So there's your budget. Go do it. Divide it up by the quarter that you think the revenue is going to come in and four quarters higher, therefore it gets 42% of the budget." And then they work down into the week and have even daily budgets. Those organizations are going to be much more difficult because they're bigger, their CFO, they were publicly traded. So they had to report numbers to shareholders and forecast what their expenses were going to be. And because SEM is an expense you report to shareholders, if that expense was a hundred percent higher than you told them it was going to be last month, they may not be happy because they're not understanding what's that top line number that it was driving. So you have to have it correlate really, really well saying, "Hey, we spent a hundred percent more, but we actually drove over a hundred [inaudible 00:13:53] more revenue." It's going to make them excited. But the group that's doing the conference call with the shareholders may not understand that and be able to break it out in that much detail, especially if it's a multibillion dollar organization and the website is a small piece of that overall business, which it was at the point we were working with them. It's challenging. So my advice is to try to chip away at certain aspects of it over time, being able to show, "Hey, when we spent more at this level, we got more, it was a direct correlation." And I like to use impression share showing potential like, "Hey, there's a potential there in impression share. We used absolute impression share at the top, which means you're in position one on Google and top impression show, which means you're just above the search results," to kind of give an indicator if there's a room to push. And then I also like to talk about what we refer to an internally as the Halo Effect. I don't think that's an official term, but if it does become an official term, you heard it here first. Paid search, specifically shopping in eCommerce has a large impact on organic traffic and direct traffic. And in fact, if you look in Analytics and you get lost in Attribution, sometimes it's hell, sometimes it's heaven, but you can get lost all over an Attribution. You will find out that the more you spend on Google Shopping, the more your organic traffic increases, the more organic sales you get. And you can look at assisted conversions to see that if you label your campaigns appropriately, you can see generally on non TM shopping campaigns, which is non trademark people, just looking for your product and service, and don't know you as a brand yet for that product or service, you will see assisted conversions generally higher than attributed last click conversions in Google Analytics. And so it's having a disproportionate influence on driving sales through other channels, and it is driving sales to its accredited channel. And so showing them that, showing them, "Hey, this says have a large impact. If you just cut it, you're not just cutting the results that you're seeing from the SEM budget. You're cutting results you're seeing in other channels as well." And so in some companies, this is unfortunate, but if you cut Google Shopping, your SEO team, all of a sudden is going to look worse without them doing anything wrong. They just happen to have the organic traffic drop because of Google Shopping not spending as much money. So it's a very complicated web picture as we continue to shop more and more online, it's only going to get more complicated and intertwined, but at least helping them understand some of that first, even before you get to the, "What are we going to spend," budget. Jon: Yeah. It's almost like we, as an industry, need a one sheet for executives on how to explain this simply for them, because I think there's a so much education that goes into this. And I think half the job of marketing ends up being internal education, which is really just reduces effectiveness. I mean, we fight that all the time with conversion optimization ecomm and marketing teams, they're all a hundred percent on board and understand the return on the spend on optimization. But then you look at a high level executive and they say something like, "Well, but you know, we just had our best month ever. Why would we need to optimize?" Ryan: No, exactly. We're constantly in education mode in what we do. And I actually had this conversation with Google last week because they're really internally pushing for more automation within Google to control a lot of the inner workings of Google, which is not bad for many companies, but they want to move agencies into more of an advisor role and helping companies grow by educating them on digital marketing, which I think is a great goal. I said that, "Well, the problem you're going to experience with that though, is you've got a bunch of, let's just say 24 to 30 year olds in digital marketing that have never owned a business that are trying to educate business owners on growth strategies for their brand. And they probably just don't have the experience to be educating at a high level why these companies should be investing in marketing." And it's scale yet, I just don't think we have the expertise as an industry to be advising people that have grown hundred million dollar brands on how they should continue growing. Jon: And the barrier to entry with marketing roles is typically pretty low, right? Ryan: Yup. Jon: It's something where there is a lot of people in the industry, but there's few experts. And you start doing something like that with all of the junior folks who are just getting into it, and you're going to end up with some big problems. So let me ask you this, Ryan. What are some ad word budget management solutions that kind of help you maybe just prevent yourself from even under spending? Because I think we've determined today, most companies under spend, right? Ryan: Mm-hmm (affirmative). Jon: Because they're not focusing on the right metrics around this, but I know you're talking about a lot of these tool sets that Google's coming out with. I know we've talked about them on this podcast before how I've even been personally kind of put through the ringer by using automation tools through Google. So what are your thoughts just on the AdWords budget management solutions that are out there? Ryan: Generally, I don't like them, but when I'm talking to business owners about controlling budgets, the first thing I tell them is, "Look, you're going to have flexibility, regardless." If you're rigid on your goals, you're either leaving money on the table or you're wasting money. You can't dictate search volume across the entire United States, for example, for your product or service, but what you can do is decide, "Okay, here's what my goals are. Let's make sure that we're at least meeting those. And if we have a little bit more we spent, that's probably okay, as long as we get the goals, if we under spend it's okay, because the search demand wasn't there." Google at its core is a demand capture. People are searching for a product. You put it in front of them because you have that product. There are pieces of Google that can be demand creation, but by and large, it is demand capture. And so build flexibility into your model. But then this is another thing I have to educate a lot of businesses on as well. A big education piece is aligning your marketing goals with your business goals. So often those are not going in the same direction. So you have a marketing team. That's been given a goal and they're rowing in direction to achieve that goal because they have incentives and bonuses in place to hit those goals. And then you have an executive or a business owner that's driving or paddling the boat in a different direction because of their goals. And if they're not aligned, you have a lot of tension and issues because there's going to be frustration from the executive team. "Why isn't marketing giving me the results I want? We set this wonderful goal and they achieved it, but it didn't have the impact I wanted it to." So you start with, what's your business goal? Do you want to grow? Even beyond that, do you have an exit strategy as an owner? Do you have shareholders? You have to hit certain metrics as a business to be successful and make them happy? And then after you've set that you say, "Okay, how can my marketing team utilize the SEM channel to help hit that goal?" And let's set incentives around that rather than what a lot of companies do is well, "We had an agency five years ago tell us that we should be getting it for X or you know, 10 years ago, we were highly profitable on Google Ads. I want to be highly profitable still." And don't pay attention to the changes or evolution of digital marketing over the last decade that has made your 10 X profit goal spending 50 grand a month, not possible at this point, based on what your site's converting at or all these other things you could be doing or should be doing. So it's goal alignment build in flexibility and then monitor it. It's not something you just set it, forget it, let the marketing team just do it. Like I'm in marketing, I have brands, I still daily track everything. It's all about the data. Like I want to know what's happening in my business regularly. I don't let it go on autopilot. Sometimes I want to, but I don't. And just in be involved as a business owner, you have to have an understanding of what it's trying to do. Jon: This is great because I think if I could summarize a little bit of my learnings from the conversation today, it's you shouldn't have a budget, you should have a goal, right? So look at the other end of the spend, not the front end, but the back end. Ryan: Mm-hmm (affirmative). Jon: And then you really need to work on educating your team internally and the executives, if it's not your money that you're spending, because that way, you're making sure that they understand the return on the investment there. And then from there it's really an inventory challenge perhaps on how much you could spend. And you could really look at this as a cashflow machine. And that's how this should be looked at, perhaps is what's that cashflow equation? How are you getting that money before it's even truly spent? And how can you reinvest that up until you have no inventory left or you have an inventory problem. And then from there, there's no real way to kind of put something on autopilot here. They just don't work that well. You don't want to look at your marketing channels as equal. You really want to play at these different points of the acquisition funnel as you've mentioned. Did I miss anything on that? Ryan: Well, there's a couple of points. I think people should just pay attention to as well. There are circumstances where some companies intentionally lose money on the initial order from a customer. They have high lifetime value, they have a competitive space where it's necessary to even compete. They're going to lose money on the first order, beauty, skincare, that is often the case. Jon: That's still the cashflow formula. You're just stretching it out, right? Ryan: You can't spend unlimited money because it does actually cost you money to get that customer. And so you have to look at, from a finance perspective, how much money do I have in the bank? I can't spend endlessly if I'm losing money on the first order, if I'm breaking even or profitability, you can usually spend endlessly, but then it's also saying, "Okay, what's my diminishing return, and is there a better place for that investment?" Yeah. Diminishing returns is I'm losing money to spend. So maybe I stopped spending here on Google because I know that I can get this money losing return on Facebook or Instagram which is actually better. And so that's where forecasting probably has a bigger impact. And we've had those conversations with businesses about lifetime value. And there's some complex math formulas around it, but it can be done. But then when you're looking at moving budgets, there are some automated tools that brands love looking at. I mean, brands really do love tools that have great graphics and sliding things you can move around and makes it look like you're just doing amazing. And there's one that I really don't like. And it says, "We're looking at your Facebook spend and your Google and Microsoft spend. And if Facebook is at a five X and Google is at a three X, Oh, we're just going to move money from Google over to Facebook and keep spending until they're kind of at equilibrium," because that totally makes sense if you're just looking at math and numbers, but what most brands miss is that those budgets are accomplishing very different things. And so you have to look at them differently and not necessarily move budget from one to the other, just because a return on adspend goal makes sense like, "Oh, I'm printing all this money on Facebook and I may be breaking even on Google." It should be looked at differently. So generally avoid tools that just automatically move budget to the best performing things. Because for most businesses that doesn't make sense. Jon: I think that's a great point to end on today. And I think we've packed so much into 30 minutes here. I really appreciate you as always Ryan educating me on and helping me change my point of view on this, as I definitely came in thinking of SEM as an expense line item and you need to budget and have a forecast around that. And you've definitely shifted my thinking completely around, which is awesome. Ryan: One less business owner to educate. I love it. Jon: Boom. All right. Well hopefully a few other got educated today by listening to this and we'll continue to spread the word. So thank you Ryan. Ryan: Thanks Jon.

This week's show is very exciting & important for so many reasons. So let's explain. This is a first for Into The Wild. This is our first ever panel show recorded with 3 guests over zoom. Not only a first for us though, it's a first for the UK & likely, many other western countries. As we are discussing the topic of trophy hunting...."But that's been done Ryan?" Yeah, I know, but to my knowledge, never has this chat taken place while purely chatting to the people it directly affects. 3 local, key wildlife & community workers of Namibia. These people are, Maxi Louis, who has over 22 years of experience working with communities in conservation. John Mwilima, a member & advisor of the Banumu conservancy. And finally, Lorna Dax manager of the Khaodi & Haos conservancy. You may already have your opinions & views on trophy hunting, I did before I started the chat, however, I ask you to leave them here. This show is about talking to local people, whose lives & livelihoods depend on trophy hunting (or, since this interview, I now call, conservation hunting.) Maxi, Lorna & John don't just look at records or stats & bits of paper, they see the impacts of conservation hunting. From the benefit to the people & local communities, the animals & their survival & the habitat & environment. It's easy for us in England, or America, or France, or Australia etc to criticise a method such as conservation hunting, however, we do not live in this country. We should be listening to the people that live in these areas & learn more about methods like this. As highlighted in this show, African people have harvested animals for hundreds of years, this isn't new. Also as pointed out, it is heavily regulated. But, I don't want to give anything away. I also don't want you to think you have to leave here being pro conservation hunting. You don't. That's up to you. All you have to do is listen to these 3 voices that are too often, ignored when talking about this topic. For me, I've learnt so much more & understand it far greater. Could I hunt? No way. Do I understand why Americans or Britain's pay all this money to hunt? Not really. Do I think it's wrong, damaging & needs to stop? Not anymore. If you'd like to get in touch regarding the topic of conservation hunting from today's show then I'd love to hear from you. You can email me at intothewildpod@gmail.com. I'll be recording another, short episode on this topic with Prof Adam Hart. So any questions you have. Chuck them over. Don't forget to subscribe to us on iTunes, Podbean & Spotify . You can also get in touch on social media @intothewildpod on Twitter & @intothewildpodcast on Instagram. Whether it's just to say hello, share some thoughts on an episode or even to let me know you'd like to hear about next!

In every business there are tools specific to that industry or type of business that will help them grow. Ecommerce is no different. CRO is one of the most important tools to grow an Ecommerce business. Today, Jon dives into the role CRO plays in Ecommerce businesses. For help with your CRO: https://thegood.com/ TRANSCRIPT: Ryan: Oh Jon, most people start businesses because they've got skills, knowledge, and the desire to control their work and what they're actually doing on a day to day basis. I would also guess most business owners want to grow and in every business there are tools specific to that industry or type of business that help them grow. E-commerce, as we know, is no different. You and I both know CRO is one of the most important tools to grow an e-commerce business and it's never a bad time to grow. Ryan: Today I'm really excited to dive into the role CRO plays in e-commerce businesses. You, Jon McDonald, knowing more about CRO than anyone I know, can you start us off today by giving us your thoughts on CRO and the growth process of an e-comm business, at a high 30,000 foot level? Jon: Yeah, sure. Well I think the best way to think about this Ryan is that there's only a small number of ways to grow your company just at a high level before even thinking about conversion rate optimization. You can get more new customers, you can get your current customers, or even those new ones, to spend more with you, and you can get your average customer lifetime value up by getting those customers that have purchased to come back and purchase again. Those are really the only three mechanisms you have for earning more revenue out of your business. Jon: So, of course, traffic generation can hit that first one really well. We might argue, and maybe you could fill in on this a little bit Ryan, but traffic generation, when done well in digital marketing, can help you also increase average order value. Then remarketing, you can resell to the people who have already purchased perhaps and you can run campaigns around that. Jon: But I think if you're really looking to impact the first two of those in a major way, conversion rate optimization is really going to be how you're going to get a higher return on that ad spend and how you're generally just going to convert more of your visitors into buyers. So if you're thinking about growth the biggest lever with the highest return on investment, and of course, I'm biased, but I think that the highest return on investment is going to be conversion optimization because with a small investment in making it easier for people to purchase on your site you're going to get a high value back that's going to be sustainable over time. Ryan: Well yeah and I think even on a previous podcast we talked about CRO after the sale even and increasing some of that lifetime value in areas I hadn't even considered actually being CRO. Like even some of the things in the shopping cart post purchase which would increase lifetime value had never even occurred to me. Ryan: I think it does play in all three, but I think for most people as they're thinking through their entire e-comm business they're going to probably see CRO in those first two buckets of growth. As you're looking at e-comm businesses and you analyze tons of businesses, is there a place in the growth curve of an e-comm business where you really see CRO as being the most impactful? I'm thinking in my head of a bell curve and growth or maybe you're growing up to a plateau like where would you in a perfect world insert CRO? Jon: Well I think that you need to have enough traffic to effectively do certain types of CRO. Let's break this down a little bit. Let's look at this bell curve in three chunks. The first chunk would be the folks who are just getting started, maybe we'll just say less than a million dollars in revenue, which is a pretty big gap there. But that first million what you really need to be focused on is making sure people know that you exist. Jon: They need to have an easy to use website but normally you're going after those early adopters who are willing to put up with a little more complications on your site than the average customer. So it's really important for that first third of that curve that you are mainly focusing on driving traffic that is going to hit a very specific segmented marketplace that is going to be your key customers that are going to stick with you no matter. Jon: You probably aren't going to be converting much on branded terms because people don't know who you are, so when people do find your site, at that point, you want to make it as easy for them to purchase but you're not going to be able to do things like AB or multivariate testing because AB testing and multivariate testing, et cetera, require enough traffic for you to get results in a meaningful timeframe. Jon: So in that first third what I usually would want people to do is when I'm looking at these companies I want to see them collecting data. What do I mean by that? Well are they actually looking at great analytics data? Have they actually ever dived in there and customized it a little bit or is it just they just put the snippet from GA on their site and that's all they have. Jon: Couple other things to be thinking about there, like you could easily pretty cheaply get things like heat maps and movement maps. You can do that type of stuff to start understanding how people engage with your website and just make changes based on data. You don't have to test it, right? Ryan: Mm-hmm (affirmative). Jon: Just make the changes. The best way to test there is just to do week over week or month over month. Now if you're making changes every day that's going to be hard to really know what worked well, but I don't want that to stop brands. They should still be tweaking their site as much as possible and then sticking to perhaps even larger changes in that first third. Ryan: In that space, in that first third, a lot of times the business owners generally don't know best practices on website. They know their industry, they know their products well. But how much would you as that business owner trust your gut looking at small pieces of data like that on a daily, weekly basis where you can't actually get an AB test and have full confidence that this is what is better. You just say hey, go with your gut on that because it's probably better than not going with your gut? Jon: Well I think that it goes back to the phrase I say quite often which is it's really hard to read the label from inside the jar. I think that with that in mind that it's still as an owner of a site and a daily operator you're still too close to it and you really still need that consumer feedback. Collecting that data and paying attention to it, even if it's only 100 visitors a day or a week, that's still data that you should be looking at. Where are people leaving, what pages are they getting stuck on perhaps, where are they dropping off in the funnel, that's all good information to know where are the holes in your bucket because they're flowing right through that bucket instead of collecting them as revenue. You really need to know where those holes are and that's really what I'm getting at here. Jon: The other thing you can be in this first third of that curve, go talk to consumers. You should email every single person who buys personally. There's not a volume at that stage under a million where you can't email every single person individually and just ask them, "Hey, this is me, this is actually me," just start the email that way. "I'm sending you a personal email. I want to know why you purchased and what your experience was." That's it. Jon: I have never gotten an email like that and I purchase online almost exclusively now, that's my job. I have never gotten a personal email from a brand. It's always an automated give me a thumbs up or thumbs down, or what's my net promoter score and they're doing it in a really horrible way. I don't want to rate you on a scale of 1 to 10, that's not what this is about. I'm not going to waste my effort there. If you sent me a person email and said, "Jon, thank you so much for buying from me, we're just starting out, as you likely know. If you didn't know, well hey, welcome to the small club. Excited you're here. Jon: I want to know about your experience because we want to continue to improve our site. Can we chat for 10 minutes at some point or can you just spend 10 minutes right now just write down your thoughts? Nothing is going to be better than that." There's a lot you can do in that first third that people just aren't doing and that's what I'm looking at these businesses if I'm going to give them a passing grade they're doing at least some of these items and most aren't. Ryan: No, I think that's important as somebody that's launched my own brands. You get, as a business owner, so many different directions that many times it's difficult to I think step back and think about okay, if I am selling online what's the most important thing to me right now. If I'm acquiring traffic I need to make sure it's doing the best. I don't like wasting money. Ryan: So I think most business owners probably need to do a little more of what I would consider some of that grunt work on their own where maybe it's not going to be your most favorite thing to do, but it's highly important if you really want this brand to work. Jon: Right. I think to get to that next level, and I would say that middle of that curve is generally a million to 25 million, big gap. But you can get easily get over a million by just doing what I mentioned. If you put in all that grunt work you will get over a million dollars a year in revenue of your site. Then once you get over that point you will likely start having enough traffic, and by enough traffic, let's just say 40 or so 1000 visitors per month. At that point, if you have 40 or so 1000 individuals hitting your website, and I should say users instead of visitors, there's a difference there in analytics. But when you have that 40,000 users on your site you can now start running AB testing on your site and actually get things to hit statistical significance, which is the mathematical formula that's going to tell you that this is proven with math that it's going to improve the metric you went after. Jon: I think that's what's really important here is that once you hit that middle part of the curve that you are really starting to invest in data-driven decision making that is run by testing ... and usually in this part when I'm looking at these businesses, these are the ones who have some money to start growing and reinvesting on a regular basis. It's usually no longer just the owner spending their own money to grow the company because when they got over that million mark now they have some employees, they start having enough margin, ideally, that they can reinvest. Maybe the owner is still involved, but they also might have hired a digital marketing manager or an e-comm manager. Jon: So at that point, that's when you really start to see some rapid growth and that's why that band is typically a million to 25 million because you can really grow pretty rapidly in there if you're AB testing in each of these 3 points we talked about earlier, which is the first time visitors, getting people to buy more, and then also a repeat customer. You can start optimizing all three of those because you have enough traffic going far down the funnel where you can even run tests in the checkout, which typically is going to be one of the pages that has the least amount of visitors to it because you're only in checkout if you're actually going to buy something. That gives you a wide range. Jon: Now if you're over 25 million, what I really start to look for there on that growth curve at that point is these people have in-house teams, generally, focused on optimization. They've proven out the value in that middle tier and now they've moved up to the top tier and they can start having a whole team centered around this, and if they don't, they realize that they're missing out. They know that they're missing out but there's something else holding them back from doing that. Jon: Generally, that's when they also either start to outsource that or they're looking to augment their team and come up with some additional new, fresh ideas because at that size they start to realize that they're too close to their site and they need some outside ideas. It could be as simple as they're just looking for test ideas or it could be as simple as they want to accelerate their testing and do more of it, or they want to train up their team and refresh the skillset there. Ryan: Got it. So grunt work "CRO" what we termed an earlier episode CRI where you're just making improvements to the site that are removing some friction even if there's not tests to back it up, you're just seeing some of the friction. Really it's 40,000 visitors, million dollars plus in revenue, really want to take the next step and grow. If you don't want to grow you're probably not even listening to this podcast. Jon: Right. Ryan: So you're probably not appropriate for this anyway. But here's something I don't think I've ever asked you about this, and I don't know why. Obviously when you're doing CRO on a site it's impacting everything all the site, all visitors are going to convert better once CRO process is going. What traffic channels generally see the biggest uptick in conversion rates once you've started the process and you're really seeing some good improvements going on? Is there a certain part of the site or type of traffic that you're seeing as just takes off really, really well? Jon: Well I think that it can affect the entire lifecycle of the customer, as we talked about earlier, and thus all the different types of channels once they get to your site. Now in terms of traffic generation channels, I think that generally what we see return on ad spend does improve because you're getting more people to convert. Now at The Good, we focus exclusively on onsite test, so we don't do any testing offsite, so we're not testing ads or any of that type of stuff. Jon: That's where Logical Position in your team comes in. But what we do see here is the match between having a successful ad campaign direct that visitor to an optimized portion of the site, that is like adding fuel to a fire. At that point they both become way more effective. So there's definitely synergies there. Jon: Now in terms of overall channels, generally, we see organic go really, really high. This is because people are already looking for you. They already know you exist. At that point, they've made their mind up that they likely want to purchase, maybe they heard about you through a friend, or it's all those channels that are going to have the people who are going to clearly fit your ideal customer profile. Jon: Now you're going to see those organic numbers really start to increase and improve because you've made the site easier to use. You've reduced all of the barriers that person who already really wants to buy that they're not going to get as frustrated. They're not going to have a reason to desert like they had prior to optimization. Jon: So that's one of the benefits because at that point you can get your cheapest traffic to be optimized and convert higher, then that's where you're going to see a massive return on your investment. But that's not to discount that you would see higher conversions from people who come by clicking on an ad and I think that's really going to be valuable in terms of return on investment. So there's a couple ways to look at that. Ryan: For a business's initial foray into CRO do you recommend their focus be on increasing the number of conversions, increasing the average order value, something else, or all of the above at the same time? Is there an order that I should be looking at those as a business owner? Jon: Yeah. I think that unfortunately The Good is in an industry called conversion rate optimization, so a lot of people come in with the expectation that conversion rate's the only metric that matters. Now I totally understand that 100% matters and if you can move that lever then you're going to see a massive return on your investment in it. But there are a ton of metrics that you do want to be looking at that are I would argue as valuable, if not more valuable and more sustainable. So if I get your conversion rate to double or I get your average order value to double we're going to have this very, very similar outcome, mathematically. People spend twice as much or let's just break it down, I get 100 people to spend $2 or I get a 100 new people to spend $1, we're going to make the same amount of revenue, right? Ryan: Mm-hmm (affirmative). Jon: So I think you want to look at these metrics more holistically and then develop a plan to one, analyze where your weakness is. Maybe you already have a really strong steady conversion rate and it's more about getting your average order value up, or maybe you notice that your cart abandonment rate is really, really high, or maybe there's not enough people even adding something to a cart, so there's all these clues, there's all these clues around why people aren't buying. Jon: If you just focus on conversion rate you're going to be, as a consumer, an untrained eye or maybe just somebody who's in that first band of up to a million dollars. They're going to go online and read a bunch of articles about improving conversion rates, and the reality is, a lot of them are just going to start running discounts, do pop-ups. Do all these that will show you an immediate boost of numbers but it's not sustainable in any way. And you start having long-term systemic issues where you're stuck on the discount train and once that discount train leaves the station your consumers are always going to be expecting discounts at every single purchase and every single stop, and that's really hard to get off the tracks once that happens. Ryan: And that's not a fun business. Jon: Right. Nobody wants to be in the business of, how do I put this, of giving everybody free stuff. It's basically what it is if you over discount. So I think you really want to be thinking about what metrics are most important to moving the needle for your business. The only way to do that is to go back to what I said earlier, which is early on in your business you need to set up the right tracking. You need to get used to looking at the numbers and you need to start making data-backed decisions. If that guides you into understanding where your metrics could be improved then that should be where you're going to start working on your optimization moving forward. Ryan: Oh man, and I will double down on that statement. I have talked to so many businesses in the startup process or they've been in it a couple years even and they're with a platform like a Shopify or a Bitcommerce and they don't have Google Analytics. How are you looking at your business, oh I just look at the back end of Shopify or Bitcommerce. It's like wow, there is so much more available in a more robust analytics platform than just your shopping cart or the web platform that you utilize that I think both can be important for various things, matching each other up, verifying certain things are working, but for sure make sure your analytics is working and tracking reasonably close. Because even with the Shopifys and the Bitcommerces of the world that have 1000s, millions of users if you're Shopify, the implementations of analytics do not work the same on each one of those. They don't line up correctly all the time, so you got to make it at least line up as close as possible. Jon: Yeah and there's one thing that one of your team members at Logical Position, Brian Aldrich, he really hammered into my head over the years. I've seen him speak at the same events all the time, and stuff. He always says, "You need a single source of truth." Unfortunately, if you the e-commerce platform be your single source of truth you're missing out on a full picture. Jon: So just getting started early on using Google Analytics, or some analytics package, I mean I don't know why you wouldn't use Google Analytics for this, but make that your single source of truth because no two analytics packages are going to line up exactly, and I think that's the point you're making. Jon: But if you just look at one of them like Shopify's built-in analytics that's great for at a glance how did I do day over day, et cetera, but the reality is, it's not going to help you optimize your site so you really need to have that real truth, source of truth, be something that is a full picture of the consumer experience. Ryan: Funny enough, analytics is top of my mind because I had a contact from another one of our partners. He's going off to look at other businesses to get involved with and one of them was an analytics company, so he had me sit down and talk with him to see what it was about and if it had some validity. They started their pitch at me was, "Well you already know analytics is bad, right? Google Analytics?" I was like, "Well, no." Ryan: Their whole thing was like oh yeah, Google's just bad. Google Analytics is bad because it gives itself too much credit and doesn't actually let you see the full attribution of everything. I'm like, well, I mean I don't believe that. But you see it's probably more in depth analytics products across the board. Does one in particular stand out as a business owner when you're looking at things? Is Google Analytics okay but actually bad or is it Adobe is way, way better, or something most companies haven't heard of that they should be looking at in addition to analytics, or instead of? Jon: Well I think you make a good point here and that's that every analytics package is going to be a little different. The thing is it's all in how you use it and the consistency in which you use it, it doesn't matter which platform you use. Also, a startup doing less than 10 million, they have no business looking at Adobe. They can't afford it, just be upfront about that. So it's also what is your return on your investment going to be? Jon: If you are spending a ton of money to get some data but you're not utilizing that data to get a return on that spend then don't do it, what's the point? This is where Google Analytics really serves in a great need is yeah, look, you're giving data to Google, if you're not paying for it you are the product. So the reality is it's a trade off. A lot of people think there's privacy issues in giving that data to Google, and whatever. Jon: Reality is that if you're a site doing under a million dollars a year, or even way more than that probably, Google doesn't care about your data, quite honestly. They've got bigger fish they're working with. The reality here is that out of the box Google Analytics is a great tool to get started with. Then if you don't ever touch it and you don't customize it, yeah, there's going to be better tool sets out there that come customized out of the box. But what I highly recommend is that you start learning early about Google Analytics, you learn how to set up custom dashboards, you learn how to feed information into GA through events on your site. Jon: There are limits on what type of personally identifiable information you feed in, but you can still feed in stuff without tying it back to a user pretty easily. You don't have to send a user's email, or an order number, or a phone number, or any of that kind of stuff into GA to warehouse it there, but you should be able to feed in whenever someone buys a product you can event that says this product was sold and this is the dollar value. That's not tied back to anybody. Jon: So I think there's a lot you could be thinking about there that could extend the Google Analytics to do everything you need and it's going to happen pretty easy out of the box. Now if you're looking to do segmentation that's really drilled down and have a lot of other information, you're going to need tools on top of Google Analytics to do that. But quite honestly, Google Analytics is great for the vast majority of brands out there. Ryan: Good insights, I appreciate that. As we're winding up I do have one more question that maybe it's interesting for people or not, but what's been the longest CRO engagement you've been a part of? Jon: Yeah, it's a great question. If I understand why I usually get this question it's because people want to know how long can conversion optimization influence growth. Is that basically where you're going with this too? Ryan: Yeah, it's like is it 2 years, is it 10 years, is it 6 months. Jon: I have a couple of answers to this. The first is that we've been in business over 11 years and if conversion optimization was not a sustainable thing then there'd be no way we'd be in business this long. I think the longest that we've been, I would say, we had a customer for four or five years and the engagement ebbed and flowed over time, meaning that we would sometimes be launching a lot of tests and sometimes just be holding their hand as they went through changes and coming back and forth. But they were a paying customer of ours for a handful or quite a few years, however you want to look at that. Jon: Now an average, an average goes about two years. Right around that timeline is when I see an average customer that we've helped them get to that next level where we have helped proven the value of conversion and optimization to the point that senior management decides this line item, that's not going away, so we should probably hire and bring that team in-house. I applaud that. I think at that point it makes sense. Jon: If you have a brand that has grown and you've used optimization, and you know that you're going to continue doing this, and you have successfully changed how you think as a brand to where you know that you are going to use data to make decisions, that you're going to put the consumer interactions on your site first, that you're going to really, truly care about your consumer's user experience on your site and the customer experience over all, then great, we've done our job. Jon: We have fulfilled The Good's mission of removing all of the bad online experiences until only the good remain. If I can do that at a brand and help them eliminate all of that, and want to have that same mission, and carry the torch, then I applaud that. So I think after about two years is generally when I see brands start to take that in-house, but there's a lot of brands who decide not to and continue to work with us beyond that. Ryan: In the CRO process does it ever work where you can start and stop constantly like hey, I want to do a three month here, stop for six months, do another three months, six months, stop, does that ever work or is that just more butter and can't finish the process when you start and stop constantly like that? Jon: Yeah, look at it this way, if you want to run a marathon are you going to train to win a marathon by one week running and then taking a couple weeks off and then running again? No. You need to build up [crosstalk 00:27:03]. Ryan: Did you get my training schedule? Jon: Yeah. I'll leave that one. Ryan: Yeah. Jon: But I think it's interesting, a lot of brands and business owners approach it the same way, they just feel like hey, well I can go optimize my site right now and do this once, and be done with it. That's not how it works. I think anyone can go out and do this checklist but that's just step one, that's really just the beginning. So I think all in all that when I see that and I try to set that expectation upfront and when somebody says, "Yeah, I'm going to do this for three months and then reevaluate," it's like well you know what, we can always reevaluate. We can just have that conversation at any point. Jon: But if you're only truly going to do this for three months then we're not going to be a good fit. In fact, do not spend your money on optimization at all because it's not going to have a sustainable long-term impact. You're better off just taking that money that you are going to spend and just running a bunch of discounts on your site, or spending it to drive a lot more unqualified traffic, or doing a lot of other things just to get your brand out there. Jon: But if you really truly want sustainable investment and optimization it needs to be a small amount spent on your site in a regular interval over time and it needs to be a long-term line item. So spend each month and compound that growth very much like a retirement investment account. You need to put a little bit in with every paycheck and then eventually you're going to start getting a lot out of it that it's going to just grow and grow and grow over time. Ryan: That is a phenomenal analogy, I think, for what CRO and what you should be looking at it as. Thank you Jon, I appreciate all the insights today. Ryan: Is there anything I didn't ask that I should have or a point that you wanted to get across in this topic that you couldn't get in there? Jon: I think I wanted to emphasize that CRO can be done at a company of any size, it's just the methodology in which you're going to do that. So I think you have the option to look at getting some data and making data-backed decisions at any size company. How you might use that data and approach, are you going to use that data to run AB testing? No, not for every size company. Jon: But I do think that there are options for every size company. So the mistake I see small brands make is that they feel like they can't do optimization because it's just too expensive and they look at it as an expense instead of investment, and perhaps they're intimidated by the data. But I think that there's a lot of options out there. Ryan: Jon, thank you as always for enlightening me and teaching me something new. I appreciate it. Jon: All right, looking forward to the next chat Ryan.

There are so many folks selling “search engine” services these days. And a lot of that is “snake oil” –– especially when you talk about “search engine optimization” or SEO. And this no doubt bleeds over into the SEM – or “search engine marketing” field too. Today Ryan unpacks just exactly why SEM is so hard to do yourself. For help with your SEM: https://www.logicalposition.com/ TRANSCRIPT: Jon: There are so many folks selling search engine services these days, and that is a lot of snake oil out there. Especially when you start talking about search engine optimization or SEO, this no doubt bleeds over to SEM, or search engine marketing field, as well. The challenge that I see here with SEM is similar to what often happens in my world with conversion rate optimization. There are a ton of free resources out there, checklists, how-to articles, online trainings and certifications, and most of them are too high level and broad to actually be helpful with the e-commerce site. In my view, this really makes SEM very hard to do yourself, especially if you're an e-comm owner. Ryan, today I'm really interested in your thoughts about search engine marketing and why and what makes it so difficult to do it yourself? I really can't wait to get schooled by you once again. Ryan, let's start maybe with what your definition of search engine marketing is. Ryan: It's not complicated, for me. Search engine marketing involves making sure that you are showing up when people are searching for your product or service. As long as there's an intent or a search around that and an active process of putting something in, whether that's voice or typing, texting, it's ... they are searching for it. For me, the biggest ones are obviously Google. Bing, which is now Microsoft Ads. And then I consider Amazon Ads search engine marketing. Yahoo's in there but they usually just get powered by Google and Microsoft Ads themselves. In all of those platforms they are searching for it, and you can design a specific ad in that system to attract that searcher. Jon: That's interesting. I just heard something that brought up an interesting point for me. I've always thought about search engine marketing just being on search engines, but there's so many things out there that are search engines right now. YouTube is the number two search engine. Would you consider showing up in results and marketing around YouTube part of this? Ryan: I guess ancillary, to a degree, yes. It's part of Google. Google owns YouTube and you advertise on YouTube through the Google Ads platform. When you're capturing searches on Google looking for your particular product, you can also have YouTube ads, as far as remarketing. The difference I see on YouTube versus general search engine platforms is that a not a lot of people go to YouTube to find the product to buy. They may be doing some higher level research on looking for reviews. If I'm looking to buy a Bluetooth speaker, my dad just bought one for his neighbor, he had to do some research and figure out which one was going to be easiest because she's 80 years old. You can go on YouTube and find some reviews about ease of use or older people using Bluetooth speakers, and see which one's easiest. It's a research process, more, on YouTube, then it'll be, "I need a Bluetooth speaker now. I'm going to go to YouTube and buy one." Generally that's not how people are trying to transact yet. They can transact with Google or go to the website and buy it, or they go to Amazon and buy from the Amazon platform. Jon: That definitely makes sense. It's ancillary there but it's not the main way you would define it. You're thinking Google, Bing, those type of search engines at this point? Ryan: Yeah. They're actually searching for the product or service. That, for me, is the big key. In the paid realm, it involves a lot of things outside of a search engine. You can pay for display ads that are prospecting, they're not searching for you yet, or you're remarketing through those ads that can happen across the internet. You have social ads where you're marketing to followers of your brand or trying to find new followers and get your products in front of them for them to try, but they're not actively searching for that product. You're trying to get them to search for that product. So search, generally, I see further down the funnel. Jon: Okay. Ryan: [Crosstalk 00:04:18] a cut when people are not searching for it. Jon: That definitely makes sense to me then. I know this is a high level question but it is the topic of the episode today. Let's just dive in. What makes SEM so difficult to do it yourself? Ryan: Jon, that is a great question because it crosses the mind of almost every business owner as they're looking through a [PNL 00:04:38] and see the charge for an agency or an individual that's managing their marketing, like, "Well, why can't I just save this money, put that in my pocket, or develop something else with that extra money monthly or annually?" The real answer is because the search engines are constantly changing. What is currently happening on Google or what you currently see on your phone or your desktop when you do a search, is not the way it's going to look in a couple months, six months down the road. That constant change means that you need somebody or something to keep on top of all of those changes constantly. Just from the Google algorithm of ranking organic results, I think there's 500 to 600 changes every single year to that algorithm alone. If you've been in e-comm long enough, you've seen a huge change around the paid side of things. You had Frugal 12 years ago, 10 years ago, where all of your clicks and shopping were free. Then it changed into PLAs, then the Google officially called it Google Shopping and then there was Smart Shopping. In between those big shifts, there was all these little changes. Constantly new ad sets, new placements. We now have ads that show in Google images. We have Google Shopping showing all over the place and being able to dissect and see which ad types are working versus not working. It's crazy how much development we have to do internally to keep on it, and we have 700 people at the company constantly researching, studying. And then we have that group think kind of thing going on. But that amount of change is astronomical, and I've been in the industry for 10 years. My general thought is, I've been studying to be an expert for over a decade now, and I'm still, by no means, the smartest person in e-comm marketing. There's people like [Frederic Filloux 00:06:19] whose brains are ... I'll probably never catch him, but if you're a business owner or a marketer and you've not been studying specifically how to be the best possible expert in paid search, for example, you're going to beat ... get beat by somebody that's been studying it to survive or as a career path, or because they're super passionate just about paid search. I think understanding that dynamic, it makes it difficult to say, "Oh, yeah, I probably should DIY this to either save some money or because I think I can really do it well." I think about it as, you're going to be in a fight with somebody, because that's kind of what paid search is. It's your money versus theirs, your ad versus theirs, for the consumer at the end of it all. You could be a decent fighter, but if you're not a professional, you're not going to jump into the octagon and try to take on somebody that does this for a living and eat, sleeps, trains, and breathes ultimate fighting. It's not going to happen. Jon: We don't need to get kicked in the face because you have not been training, right? Ryan: Exactly. Jon: Let's break that down then. There's two possible options if you are going to work with an expert. There's the contractor and there's agencies. What's the difference between hiring that really passionate individual versus hiring that agency with 600 employees? Ryan: This is a good one. There are some highly talented contractors in the world. Very, very good. Some of the best people at an agency will go off on their own and take one or two clients and just operate those clients. Nothing bad with it, it happens regularly in our industry. The problem is for the majority of contractors, their life's going to evolve. If you get a contractor, let's say when they're 25, it's just them, they're traveling around, enjoying life, managing a couple of clients. Great lifestyle for them. Let's say they decide to take steps and have a family where maybe income needs to increase. Well, if your company is not providing enough income for them, they need to have more clients. Generally in America, you want your business to increase in value or you want your work to increase or your income to increase. Most contractors are good for a little while and then they want to scale. They want to get bigger. That means they have to also look at acquiring and so they're stepping away from just managing your account and figuring about, "How can I get another account?" or, "How do I insulate myself if this client canceled so that I don't have a huge income hit and starve for a few months until I find another client?" There's always going to be this dynamic with a contractor of growth versus taking care of what they have versus how do they protect themselves or insulate themselves from clients that eventually will cancel? That's part of it. The other part, I would say, is when somebody is doing nothing but working on your account they will know your account intimately, but are they going to be able to see other things coming down the road or learn new techniques from an account that they wouldn't be managing because they're a contractor, but they can learn from the person sitting next to them in an agency? I've seen a lot of group think that's helped. We've, at least at our agency, have repurposed a lot of things that Google intended one way, completely different way, and it worked phenomenally well. For example, this beta, we did one that was intended for the travel industry. They were showing these big, beautiful images when you search this destination. We're like, "Wow, that is just awesome." We didn't have a tremendous dearth of travel clients at the time but we're like, "That's really cool beta." We're like, "I wonder if we could get one of our e-comm clients to show product images in there when somebody searches for a product." So we went to our Google team and was like, "We think this has some validity with this client here. Do you think we can get him in the beta?" They're like, "Let's get him in the beta." Worked phenomenally well. They crushed it. I think they had it for four months and then Google sunset the beta because it didn't actually work as they intended it for travel, but it worked phenomenally well for e-commerce. So we had an eCommerce client using something in a different purpose, that if we didn't have a breadth of clientele, we wouldn't have even heard about that beta and seen that. Also, Google does have some teams that help agencies that they may not be at the same level or even can have the resources to help aid just a contractor. Sometimes it can but most of the time you're going to have additional resources that Google throws at an agency because it scales Google better. Jon: They're more of a partnership there. Ryan: I also worry about the bus. If your contractor gets hit by the bus, what happens? If they're stuck at a hospital, you don't even know because they didn't have to notify their client when they got stuck in the hospital. I like having backups in place. Jon: That's a good point. Ryan, let's dive one step deeper on this then. You were at a small agency previously before you were brought into Logical Position. Now you're with a large agency with over 6,000 clients. What should people be thinking about between a small agency versus a larger agency? Ryan: Having seen both sides, I do have a little bit of a unique perspective. When I was at a small agency, I really liked being small and nimble and being able to pivot. As a CEO of that agency, it was great to have all of these options. If I saw something I wanted, I was like, "Yeah, let's go do that. That sounds like fun." At a larger agency, there may be a little bit more red tape when I want to just go do something. We have to get some people aligned and make sure it's not going to impact other parts of the business. From a client, I get some clients that have said, "No." They don't want to work with us at Logical Position because they don't want to get lost inside a large agency. They want to be more important to the agency that they're working with which, I can see that. As a business owner myself, I'm like, [inaudible 00:11:40] my vendors to care about me and pay attention to me. So some of them are like the big fish, small pond. There's some good things about that. I think most agencies in the U.S. are not as big as us and so most agencies I would consider small. They can be hyper-focused on industries so there's some ability, if you have clients that operate locally ... I know there's a really big agency, actually, that focuses just on flooring. Most flooring contractors and suppliers operate locally and so they're able to just be very, very good at saying, "We know how to market flooring. We're going to do it in Dallas for this company and this company in this area of Dallas," because there's not as much overlap. In the e-comm space, generally we're all competing with everybody in the U.S. for eyeballs, for clicks, and for sales. I personally want the absolute best for my marketing, whether it's big or small. That part becomes, if everything else is equal, I generally like more resources in my vendors. They are more insulated. They're more protected against employee turnover. They're more protected against a power outage and one office can be compensated for in another office. Generally more security measures in place at larger organizations. This is obviously generally speaking. That's just a personal preference of mine. I've seen the difference at a larger organization. That group think is just expounded upon if the agency is run well. We have people dedicated to strategy. We have omnichannel strategy team that our clients don't pay for but they rotate through all of the clients and help their clients understand omnichannel strategies and maybe things they weren't normally thinking about in their paid search conversations that has to do with, "Your social strategy, maybe you need to look at this," or, "Your wholesale or direct to consumer through brick and mortar, maybe we need to talk about this," or, "Here's some partners that we have over here that may be appropriate." I think it's the overall resources we can allocate because of scale, it's pretty impressive. I didn't dislike boutique, but, man, our clients have so many more resources now under the Logical Position banner than they had beforehand. I think our skillset and optimization strategies have evolved at a much quicker pace with all the people involved in hiring new people and new blood to give us fresh eyeballs. We may be doing things one way and somebody else comes in and like, "Well, you could really change this and do it that way." And we're like, "You know what? We never even thought about that because we've been doing it this way for three years." Now we have another set of eyes that's fresh and they're like, "That could be done better." Jon: We've talked about what search engine marketing is. What's the difference between working with a contractor versus doing it yourself versus hiring an agency of different sizes. What if somebody who decides, "I'm not at the point where I can pay somebody for this yet. I need to do search engine marketing to get started. I know it's going to be difficult to do well myself, but I want to set myself up so that I can transition to that agency and get some help down the line," what are some good ideas for how they should get started? What should they be thinking about as they're diving into this? Ryan: I think people starting off, you need to start with the idea that you're entering the marketplace and you haven't been there yet. What I look at is there's been homeostasis across the marketplace as it sits now, and you're going to put a new competitor in there. That's going to have an impact. As the new competitor that doesn't have the data that the other competitors do, whether the other competitors use it or not, it doesn't necessarily matter. They have some data if they want to use it, you're coming in almost blind saying, "I think this is going to work. I want to pay for clicks and traffic to my site." That disruption, you need to probably default to aggressive. Aggression can mean many things in the e-commerce SEM space. When I say it, I'm meaning that you are willing to take less margin-per-order to capture market share and start collecting that data fast. If you're going to compete nationwide, e-commerce in the paid search realm, you're probably not going to compete well by spending 100 or 200 bucks a month. If that's your budget, there's probably better places to put it. I generally say, if you're not going to start with at least 2,500 bucks, I think you could probably do better things with it. This is not a fast and true across all industries, all e-comm period, but as a general rule, do that. Then you also need to commit to it for at least three months. Basically you're looking at 7,500 bucks of marketing to be able to get a good gauge. In a perfect world, you're going to go at least six, but the shortest I would go would be three months to get this data. Jon: What I'm hearing then, Ryan, is if you are going to dive into this, you likely should be looking at spending a decent amount of money. If you're spending that much money though, then it does make sense to have someone manage it. It's like, if you have a lot of finances personally, you should have someone helping you manage that because you can't be looking at it every day, adjusting your investment. That's kind of what's needed here, right, is somebody to help look at that? Ryan: Oh, yeah. In fact, I actually tried to start up a domain called, Search Investors, because I wanted people to see us as investors where you're putting money in, and our job is to make it do what you want it to do. It is complicated. Just like I don't manage my own money, my investments. I don't have the time to dedicate that somebody that knows the investment world and can prepare for ups and downs and get my money doing what it's supposed to do. I'm not even passionate about it. It's like, "Just go make it happen. I'm good at maybe bringing the money in and you're going to be good at making it grow once it's in." Yes, that is part of it, is once you're going to spend 2,500 a month, it does make sense to have somebody that's really, really good at this to give you the best shot at it. If you're going to spend less than that, you can probably get a little more creative. There's some areas you can probably be spending money. One of the great ways to start would, if you wanted to truly spend 500 bucks, put a gun to my head and say, "You have to come up with an idea for 500 bucks a month." I would say, "We're going to go onto Microsoft Ads because the competition is lower there, the search volume is lower. You can maybe test the waters a little easier. The platform itself is a little more difficult to work in, maybe, than Google, but it's still generally the same thing. Track your sales and orders there through that process." Even then, I think 500 bucks a month could be spent more wisely at growing an e-comm brand. Maybe if you also sell on Amazon, Amazon Ads may be better. There could be a better place on social media to be spending 500 bucks on an influencer to drive some sales. Even doing some SEO at 500 bucks a month may be more valuable for your brand than $500 in paid search. Could be. Every situation is different. I don't even do my own ads because I know there's people better than me. I'm fairly good at the ad piece, but I know people that are so much better than me, I'm like, "All right." I'm playing this game to win. I'm not playing it for fun. My businesses aren't ... they are hobbies because I just enjoy them, I'm passionate about business. But at the end of the day, I want my businesses because I believe I'm the best at what I'm doing there, to be the biggest and the best because I'm going to be able to help more people. I use my resources and thoughts saying, "If I'm really good at the marketing piece, I'm going to capture a larger market share, I'm going to have more of the market, and there are going to be more people that know me and are happy with what's going on versus my competitors, which maybe aren't as good as I am." Jon: Within the past year we've had this global pandemic. I'm wondering, how does that change some of what you're thinking about here around these items? Ryan: I think it's even more important to have experts that have lots of data behind what they're doing. We've had global pandemics which are relatively new [inaudible 00:20:01] States, at least since we've been alive. The last big one we had, you can look back at the Spanish Flu of 1918, but there's not a lot of people that have been alive that experienced both that one and then we've had the coronavirus going on. Changes like that, I think, are going to become more common in the online space. It's just going to shake things up and cause people to look at data differently or transact online differently. I think people with more data and more access to it are going to be able to see trends quicker and pivot clients quicker or test more things at the same time. It is, to a degree, another argument for maybe a larger agency, that when you have 6,000 clients that you're talking to monthly that you're seeing what they're doing in the marketplace and you're seeing, "This business owner tried this over here, look at how good that worked. Hey, we've got a bunch of other clients that can now try that or experiment with that in their business." It's almost like CRO across 6,000 clients, to a degree. Not necessarily CRO but you're seeing all these various things happening and all these AB tests going on that we can look at our Google MCC and see, "What is causing that client to go crazy right now? Let's dive into that." It's, I think, more important to have somebody that just understands. As we get more and more experienced with these massive global hiccups, if you will, we're going to know how to react better and better as a society. I think also, generally experts react even quicker to changes. You play a lot of basketball, and when they started shooting more three-pointers in Golden State, they had people that adapted very quickly to that. Then even just a couple of years later, the best basketball players in the planet weren't able to do as much as they could have before against that offense or against the defenses they were setting in place. The experts will evolve the quickest, and now you could probably still go into high school basketball and shoot three-pointers all day and that same exact Golden State offense will work really well at the high school game. Jon: Now it's changing, you have seven-footers shooting three-pointers. Ryan: Oh my gosh. Never would have thought before. Manute Bol when I was a kid [inaudible 00:22:01] shooting three-pointers. Jon: Yeah, I wouldn't have thought that. This has been really insightful. As usual, it comes back to expertise. If you have expertise in this industry, you will do way better than if you're just trying to do it yourself. Getting that expertise on your team is really going to drive the results for you. It's just so hard to know what's out there, what is all that data? It's hard for you, within your own little world of just you and your company, versus having a partner who is seeing this across 6,000 clients and seeing the trends and data. That's really interesting to me. Any final thoughts here, Ryan, before we wrap up? Ryan: I would just say there's very few scenarios in which I'd recommend a business owner or high level marketing executive doing in ... being involved in the minutia of digital marketing. Even if you hire a small agency or large agency or contractor, that time alone can be better spent in other areas. If I come across a business owner that's doing their own marketing on Google, I know there's nothing happening on there. They may log in every day, but you see the changes they're making, it doesn't have anything to do with optimizing the account. Maybe a couple of negative keywords but that time spent working on the business would have way bigger dividends if you'd hired somebody to handle that piece and moved on to that. That's what I try to do in my business is just, "Where could I find people that are smarter than I am?" And it's most often in almost every area. Jon: Yeah. I call that, best and highest use. What is your best and highest use? It's probably not messing around in AdWords or Microsoft ads. It's making sure that you spent the time to find somebody who is an expert to help you, and making that effective. That's a great point. We didn't even talk about the return on investment today. I think that's a really great point that people should be thinking about here. Ryan: Make more money on your time and money. Jon: There we go. Ryan, thank you so much for educating me once again. I've been schooled on what makes search engine marketing difficult, to do it yourself. Ryan: Thanks Jon.

Today Jon takes a look at how to improve your category pages on your website. He'll explore what you should know about headers, footers, navigation, bread crumbs, and more! For help optimizing your category pages: https://thegood.com/ TRANSCRIPT: Ryan: Hello Jon, and welcome to the podcast. Ryan: I was digging through one of our shared clients analytics, and this is a rather large international brand that most of our listeners would probably recognize if we mentioned their name. And outside the home page, the largest volume of traffic to their site is condensed into just a couple category pages. Now that's not unusual for a lot of major brands because of Google's algorithm, on the organic side, favoring category pages over product pages. But it also means that there's a huge opportunity for a brand capturing a lot of this traffic to really make that traffic work better on category pages specifically. Ryan: So through this, I'd really love to hear some of your suggestions and best practices on improving those category pages. And maybe even at least some tests people can be testing as they're looking at their category pages to make some improvements. Kind of like our CRI name we coined. What do you think of that category pages and the importance of them? And should we continue down this path? Jon: I love it. Let's gain some knowledge on this. Ryan: Fantastic. So most of the listeners probably haven't had the amazing opportunity I have of hearing you talk about landing pages as much, and just seeing some of your tear downs. And so as with most of these, let's start at the top and kind of work our way down, and even some of your general best practices, probably, in header navigation can be applied to other places of the site. Especially if you keep it consistent. But do we need to think about mobile and desktop separately in this scenario? Or just pick one and go with it? What's your usual recommendation? Jon: I would recommend that we start with desktop and keep it to that for today. The reason being is that even with e-com, I think we're seeing the vast majority of traffic is now on mobile, but still a very, very large majority of conversions are happening on desktop. Now that varies from site to site, of course, but I do believe in what we see here at the good on a daily basis is conversion kings is still on desktop. And so it always makes sense to start there. The other reason is that if you fix your desktop experience and you have a responsive site, that should, for the most part, filter down to your mobile website. And so there's no longer just a desktop and a mobile version of a site. It should be responsive or adaptive for the most part. And so with that in mind, I would highly recommend starting with desktop. And then of course you could look at mobile later, but I think for the point of today's show, we could just stick with desktop. Ryan: Yeah. And if you do maybe have a mobile site and a desktop site, you may need to contact us because we may have some abilities to fix that [inaudible 00:03:12], because that's probably a struggle for your business. There's maybe some lower hanging fruit for you, before you get into Jon's conversation about it. Jon: The number of sites I still see, it's dwindling. But there is still a number of sites out there that they have mobile on a separate domain. And that's always... It's like M dot, the domain dot com. That's when I know there's a bunch of opportunity there to increase sales and conversions. Ryan: God, John knows he's going to make that company a lot of money when they listen to them. Ryan: Okay. So let's start right at the header, very top as you're scrolling down this page as soon as you come onto it, a lot of companies do things that are not great in the header. What are some of the things that they're putting in there maybe that aren't needed or that distract from the actual conversion that they're attempting to get these people to take on the site? Jon: Well, I think the first thing is that it always blows my mind when I see a header, and these brands invested so much to get people to their site, right? Whether it be content marketing or paid ads or SEO, whatever it is. And then they immediately show them social icons, and show them ways to bounce off the site. Right? Social is great for getting people to your site, but once they're there, keep them on your site. Don't send them back out to those channels. And so really be looking in the header to keep people on a site, as opposed to sending them back off through something like social links or icons, things of that sort. That's the biggest one I see. Ryan: Okay. So as far as distractions, social is the biggest issue there. What are the things that maybe companies are missing out on in that header that they should be thinking about putting into them? Jon: Well, I think that the biggest thing people miss out on is just communicating very simply what the brand is, what the value proposition is. Jon: Now, most people don't think about including that in the header. And I'm not suggesting putting your entire company story there, your entire value prop. But what I am saying is you can communicate these things through perhaps your navigation and the language that's being used there through the utility navigation, through what's the lines of texts that goes right next to your logo, right? Jon: So a lot of people will just put a logo up and expect that because they're on your website, they know exactly what you do. Well, think about it through the eyes of a new to file customer. That customer just got to your site by clicking on a link that a friend posted on social. They have a little bit of context, but it would be great to get that reinforced and the first place, especially in Western cultures, folks are going to look is the top left corner of your site. That's generally where people put their logo, but then they miss the opportunity there of including additional context. Could be just one sentence or one line, does not have to be very huge and it can be blended in with the logo, even. Ryan: Dang it. I am taking notes. I think I need to go to some of my brands and add some, maybe, lines of contexts. Jon: Well, if you want a good example just go to thegood.com and look what we do in the top left hand corner right next to our logo. Ryan: No, that's brilliant. And I think as a business owner myself, and working with brands constantly, I'm in the business too often that I don't step out of it often enough and think about the perspective of a brand new user. I clicked on a link, maybe not even necessarily thinking before I clicked, and boom. Logo. I'm supposed to know what you do right before that, but probably I don't. Jon: Well Ryan, this applies to you based on what I'm hearing right now, but it also applies to almost every e-com brand and e-com manager. Is that it's, and I've probably said this a hundred times on this show already, but it's very difficult to read the label from inside the jar. Right? You are so close to this, you probably helped to wire frame out the site, design it, define the navigation, lay out all the content. And so you're so close to that, that you know what each link does, you know what the site is, you know your value prop. So it doesn't occur to you that other people might not get that, might not understand it. And it could use a little assistance there. Ryan: Yeah. And you've helped me a lot on navigation so I'm going to jump into that in a second. But before that, site search is a often misguided location on the site. Do you recommend that as high up as you can, as obviously as you can in the header? Or do you recommend other places on the page for that? Jon: I am not opposed to having search be front and center. Having search front and center is great for people who are second time visitors or repeat visitors to your site. They know exactly what they're looking for. Think about things like a car parts dealership, right? Or car parts retailer. People may come and know exactly what model number for that very specific part that they need. They're definitely going to know what car model that they want to put that on, so they might just search by that car model. So anyway you can give people a shortcut down the funnel, and skip steps of the funnel so that they can just get to exactly what they need as quickly as possible, is better. And I can tell you that search is going to convert twice as much, if not more, than just a regular visitor. So encouraging people to use search can really help boost conversions and sales. Ryan: Wow. That is an impressive stat. So just on average from what you see when somebody uses at least a decent search, because there's different levels of search quality- Jon: Of course. Ryan: ... On a site, but an average search you see approximately 50% increased conversion rate on the traffic that uses search versus doesn't? Jon: Right. And an easy win for listening to this is just look at your top five, maybe 10, search terms that people are using and search those yourself and see what the results are. They're likely lackluster. You can easily fix that, just go through your product detail pages that are relevant and add some additional meta information to those pages to have them pop up in search results. Things like common misspellings or the plural of an item. I can't believe how many times people don't think to add an asset at the end of an item because people may search for it that way. And also just make sure that the search results page... The results themselves matter, but also that search results page that shows those results needs to be optimized as well. A lot of people just forget about it and just show no context at all. They just show the title of the page and link to it. Why not have the description there? You already should be, on your product detail pages, having some meta-description that Google can pick up, why not display that there if it's already part of the page? Ryan: No, that's great. And I think making sure that a search that happens on the site has a listing of products, generally, make sure that you can look at that in an incognito window when you scrape the URL and paste it. That way you can use it, from a traffic generation perspective, you can drive traffic from a paid search ad. But also, if you're having enough people search that on your site, you should probably make that a category page so that Google can start indexing that as well, because you're probably not alone on your site in people searching for that product. Or group of products. Jon: Exactly. Yeah. And an easy way to find out what people are searching for, just go into your Google analytics. Most platforms, I mean they all have a little bit different perhaps, but most eCommerce platforms, the search results page is just something that ends in a question mark S equals. So if you figure out what that URL pattern is, and then you can just run a filter for that question mark S equals or whatever, and then you can understand how many times people are hitting each of those search terms. Jon: So it's pretty simple to figure out with about five minutes of work and I can promise you it will increase your conversions immediately. Ryan: Awesome. Okay, one area you've helped me a lot in sites and understanding how to improve the experience for the users is navigation. And a lot of companies tend to do this wrong. They seem to think that more is better. What do you often suggest to companies when it comes to navigation? Jon: Keep it to five items or less, first of all. Anything over that and people just assume that it's going to be a lot of work and they're not at your website to do work, right? So they just like, "I don't want to weed through all these options," and it becomes more taxing than it needs to be. What I would recommend here is you keep it to five items, but also have the navigation copy, be in the context of your customer, not of yourself. What I mean by that is so many brands try to promote themselves in the navigation. They have things like about us. Nobody's coming to your website to learn about us. Now they may want to learn more about you, but not in the main navigation. They typically will scroll down to the footer and look for that, or that information that's on your about us page should be throughout your site in places that people are actually looking for it in context. Jon: So a lot of people will do things like put home as the first navigation item. Really, we all know, we've been trained over years, that if you clicked the logo in the top left hand corner, it's going to take you to the homepage. So you can eliminate home out of your navigation. That's a real easy one. Also, highly recommend if you're an e-com site and you have only a handful of categories, that you just list the high level categories in your navigation and leave it at that. That will do two things. It clearly tells people what you sell, how you can help them. And in addition to that, it gives them a quick and easy way to get to the place they want to go to. So that again, they're skipping steps that are in that funnel by having to kind of continue to drill down and find it. Jon: So there's a lot that can be done in navigation. It needs to be clear. It needs to be concise. You need to keep it to five items. And you need to try to keep yourself out of the navigation whenever possible. Ryan: Got it. Now on many category pages I will see, in addition to the top navigation, a left hand navigation or kind of a filtering system on the left hand side of the category page. Do you have an opinion on if that is good, bad, helpful, indifferent? Jon: I think it depends on the amount of product that you're trying to sell. So let's talk about that. We were actually, just before we got on the recording here, we were talking about a shoe manufacturing brand that had a left hand navigation that was filtering, that contain, I think, 40 to 50 different check boxes, right? That you could filter by. Right? And the problem with that, I mean, they had every single shoe size as a filtering option. It wasn't a dropdown, it was just a whole bunch of check boxes. So imagine being a consumer and trying to filter, but you have to look through all of these items just to find the ones that are relevant to you. It's really not that helpful. In the end it actually, I would argue, makes it more complicated. Jon: Filtering in that way can be helpful. I think it needs to be a high level filter. What are the main differentiating points? And then once they get down to the product level within that category, then you could start doing some other points, like size, availability, in stock, out of stock, et cetera. So helpful, but it depends. And the thing it depends on is how many products are you selling? If you have a handful of products, then you don't need it. People will scroll and look at your six or eight categories. If you have 50 categories, so many that you really just can't list them all on a page. Then of course you need some filtering for categories. Ryan: Got it. Okay. Makes sense. I've seen some that are great on that left hand side and the other ones that I get lost and I just leave. Ryan: So on each category page, generally speaking, best practices are to have a piece of content for the search engines, usually three or four sentences talking about that category. It's great for SEO. A lot of platforms default to having a place for that content at the very top. Have you seen that impact conversion rates being at the top, the bottom, the side, or is it kind of like it hasn't mattered too much to what you've seen? Jon: Well, I think that ideally I would put it below. If you need it for SEO purposes, that is. Right? Because most of the time that SEO type of content is not going to be helpful to the consumer. You're trying to write for Google, you're not writing for a consumer. So in that sense, I would get it out of the consumer's way. But I do think that some content above the products on a category page could be helpful in letting people know A, where they are. So any type of wayfinding you can do there, that type of stuff can be really helpful. I do think that if you're running a promotion on one category, that could be a great place to do it. If you have a little bit, or just maybe even some branding stuff where you have an image that relates to that category, showing it in use, something of that sort, can be really, really helpful. Jon: Say you sell tents and you are showing a family and you're on the category page for four people tents, right? And so you show a family camping and are sitting around a campfire with the big tent in the background. Right? Something like that can be helpful. You're setting the context and the tone. Ryan: Now also at the top, a lot of times you're going to see bread crumbs. And I've heard some good things from you about breadcrumbs and some bad things about breadcrumbs. So how do you decide whether or not breadcrumbs are helpful? Or are they always a terrible idea? Jon: I'm not really a fan of breadcrumbs. I think at this point that what has happened, it's a hold over from SEO practices of yesterday. It's not something that I see quite often anymore that is actually helpful for a consumer. And typically you're just giving them information either that they're already aware of, or that they don't really need. And if they want to go back up a level to the homepage, for instance, because you're only on a category so you're probably one level deep, maybe two. At that point they're probably just going to click the logo and go home or look at your main navigation. So overall, likely not that helpful. It's just another piece of content you're asking your visitor to wade through before they get to the content that they really are at your page for. Ryan: Okay, good. And so, just a general question going deeper, do you like them more on product pages that can get you back to a category page? Or is it just kind of across the board breadcrumbs are not a great idea? Jon: I think that it's helpful to have a navigational item that takes people up one level. Now, when you say breadcrumb I think that it starts out with homepage, next page down category page then, then your product detail page, right? So now you're four or five items long. Most people put the entire page title in those. It's not just so and so category. Look, the breadcrumb typically is dynamically built and the way that the platforms do it is that they will use the entire page title. And so they put that into the breadcrumb. Now your breadcrumb ends up being like 300, 400 characters long. It's massive. It's stretched across the entire page. It's distraction. It's not really helpful either at that point. And all of the eye tracking that we've done at the good over all these years, people never look at the breadcrumb. It becomes blindness because they see it and they stop, maybe for a split second, but they're definitely not reading the entire breadcrumb. And that's why I say it becomes a distraction and it gets in the way. Because you're making people stop and think before you're giving them the content you want. Ryan: Got it, okay. So sitting on a category page, you see a list of all the products. More and more often on a lot of these SAS platforms, I'm seeing the ability to add to cart from the category page or even just a kind of a quick view, popup JavaScript. Have you seen some direction on whether either one of those or both of those as good or bad? Jon: I personally am not a fan of those. Unless you have a product that's like a refill or something like that, where you have a limited number of products and you have a product that somebody is coming to the site and is quickly looking for that product and knows they're going to want to buy it without having to see any additional details. Jon: Here's the thing, on category pages people are still looking and browsing and trying to find the product or service that is going to solve their pain or their need. And the challenge here is that you're putting a really high intent to purchase call to action by saying add to cart, likely when they're not at the stage where they're ready add to cart. And if you just give them one image and a title, and maybe it shows the stars and the price, and then says add to cart, I would think most products, that's not enough to get somebody to purchase. So you're blowing an opportunity to send them to a page that you can convince them and show them all the wonderful benefits of your product and how great everyone else says it is in the reviews, and show it in use, and all these other things. So you're shortchanging yourself by just having the small little thing that comes up, gives minimal details and then asks people to add it to the cart. Likely not a good idea. Ryan: Probably [inaudible 00:21:29] in the quick view as well, just from, if nothing else, an analytics perspective. Where it's going to be much more complex to track that process or that funnel like category page, product page, purchase. Whereas if I go quick view, it's got to be an actions in Google analytics, if it's a JavaScript overlay, you don't get to do as much optimization on the JavaScript overlay popup necessarily. Jon: Yeah. Ryan: That's what I would say. Jon: You end up recreating that funnel in Google analytics and it's a lot of extra work. And I just think all of the negatives outweigh any of the positives. Then people say, "Well, I added this to make it easy for people to add to cart." Well, if they're not ready to add it to cart then it's not easier. Ryan: Moving down, anything else that I kind of skipped in that middle page where we jumped into the footer? You've seen products, is there a good way to put products? How many across? How many deep? How many products on a product page makes sense? What's your default response to that? Jon: I think on the category page, there's so many times where people will do a couple of things. They'll list hundreds and hundreds of products here. I think that's obviously the best use case for filtering, and I would do that filtering at the top of the page. Jon: Great example of this is we helped, a handful of years ago, to optimize Easton Baseball's website. Now, if you don't know what Easton Baseball is, they're the number one supplier of little league aluminum bats. In little league college, about 99% of swings are done with an Easton bat. They don't do anything in the major league baseball because they don't do anything with wood and aluminum's outlawed. So what does that mean? Well, the vast majority of people coming to the site are parents looking to buy their son or daughter a baseball bat. Or a softball bat. And if you went to their category page, all you saw was a wall of grid of bats. And if you can imagine what a little picture of a bat looks like online, they all look the same. Jon: They're all these sticks that are different colors, maybe. Right? But you can't communicate out of that picture. What the benefit is between the different bats, right? And they have wildly different prices. I mean, you can get a hundred dollar Easton bat and you could go all the way up to, I think, a five or $600 Easton bat. And so if you think about it, you're a parent, you get really confused. And right away, you're just upset, right? You're like, "Man, I don't know what bat to get. I'm going to be here all day clicking through all of these." And you just get frustrated really quickly. You probably just log off and go to your sports sporting goods store and just ask the guy which bat you should buy. Who's just working the counter. Not a great experience. Jon: And so once we dug in a little bit, what we found was that there are four or five different leagues, little league being one of them, that have certifications for different bats. And if your bat that you start swinging with does not have that logo of certification on it, then the umpire is supposed to not let you swing with that bat. And so the big problem is that all these parents were buying the bats based on price or the color they thought their kid would like best or whatever that is, and would end up getting to the game and the bat wouldn't be able to be used. And that's a huge let down, not only for the parent who just invested all this time trying to figure this out and got through that frustrating experience, but then the child who is up at the plate to swing, and they're being told that they have to use someone else's bat. Jon: It was creating a really poor brand experience. And what we found was that there were a couple of things parents knew about their children. What league they were playing in, and then they knew what style of hitter that the person was. So were they swinging for the fences or are they somebody who's just trying to get on base or something in between, perhaps. And then they generally knew what size of child they needed. So right? The bat is going to be different weights based on the size of the person swinging it. So they would say, "Okay, well I have a 12 year old. He can probably swing a heavier bat than my six year old," for instance. Right? So generally you have an idea of what weight you need based on the child who's swinging the bat. Jon: So what we did was we added some filtering and we made it three quick questions. With easy dropdowns. What league is your child playing? What type of hitter are they? And then do you know what weight bat you should be using? And usually what we found, we came to that third one because coaches would often tell the parent, "Buy this weight of bat for your son or daughter." So they already had that knowledge that they could bring. So what was really great there was we turned a wall of bats into something that now became three to four options. You answered those questions and it gives you a couple of options and a range of price points. And then you could decide, for your budget, what would work best and what was the bonus of stepping up a level? Jon: And it took all the frustration out of it. And their sales went up online 200, I think, 240 something percent Euro per year. Just by taking the pain point out of their category page. Ryan: So you're saying CRO has a return on an investment? Ryan: Little shameless plug for Jon's skill set there. Jon: We wouldn't have been doing it for 11 years if there's not a return here, I can tell you that. But at the same point, I think that it's all about just increasing that consumer ease of use. And if you just have a laundry list of products on a category page, that's not very useful. Especially if they all look the same or there's very minimal difference, or if they're all wildly different products. That also was a problem. And so it's like, "Where do you start as a consumer?" You think about walking into Walmart. If you didn't know what you wanted, when you walked into Walmart, you're going to be really overwhelmed because they sell everything. Jon: Yeah, it's a very similar type of experience to that feeling that somebody would have, and you want to make it as easy to use and help them to... Let them know they're in the right place, and help them make that decision as quick as you can. Ryan: Got it. And so I would advise people, a lot of times what I've heard you say, is take your category page to Starbucks. Buy somebody coffee and have them try to do something on it, to try to see some of that, because I'm guessing the Easton people didn't even conceptually think about that. Like, "No, we have all these bats. We know which one you want. Just get this one." Rather than, "Oh, you're not a parent trying to buy a bat." Jon: That's exactly it, is that they were too close to the product. They were inside the jar, and they didn't understand the pain points that the parents were having because the parents don't know as much about the product as the staff did at Easton. Ryan: Got it. Okay. So in conclusion, we've got all the way down to the bottom of the page. We've seen all the products. What are some of the things and quick best practices to be looking at in the footer of the category page? And what are some of the things you see that people do wrong down there? Jon: Well, the first thing in the footer that most people will do is they just dump all their links, extra links, down there. And it's just a grid of link after link, after link, no order to them. Maybe they put a header above them, but generally not that helpful. Jon: The first thing you should do in your footer is you should repeat your main navigation down there. And it should be the first thing on the left hand side of your footer. That way people don't have to scroll all the way back up to continue the shopping experience. If people scrolled all the way down to your footer, they are interested in your company and in your products and they want to continue shopping. So give them an easy way to do that. Ryan: And then do I add in all the navigation links you made me take out? At the top. Jon: I think there's a place here for a secondary navigation, and there's generally room for it. So that's a good thing you could add here. I think that another thing that you could add in here is your email sign up. That's always a great place. If people are still interested, but they're not ready to buy, they reached your footer, that's a good time to say, "Hey, you know what? Sign up for email and we can stay in touch." Ryan: You mean if they ignored my popup giving them 20% off their first order if they signed up with an email? Jon: Yeah. If you have those popups around by now, we're going to have some big issues because you obviously have not been listening to the questions you ask me. Yeah. Ryan: Yeah. Do not have popups. Everybody listening to this, do not have popups for email. Please put it in the footer. Jon: And maybe we'll do a whole episode on popups. And then I- Ryan: It'd be very short. Ryan: Simple answer, don't have it. Jon: Yeah. You can get me really riled up if you just keep asking me about them. Jon: Yeah. And I think the thing that should also be on the site in the footer there is your contact information. And that should be in the bottom right hand corner. And I'm always surprised by the number of sites that don't have contact information in their bottom right hand corner. But here's the thing, it increases trust if people see that you have a way to get ahold of you, but more importantly just put a physical address there. Let them know that you're not running the site out of your parents' basement. I mean, even if you are, just list your parents' address on there. It doesn't matter, right? Nobody's going to show up to this address. What they do want to know is that you're a viable business that's not just drop shipping and with no care. That you are actually reachable by either phone or support email. Ideally the physical address is really just a reassurance tool. We see that trust increases dramatically if you list one. So I would highly recommend that. Jon: So having your contact information in the bottom right hand corner is just standard practice. That's where people are going to go if they want to get ahold of you. Somebody comes to your site, they're immediately going to scroll to the bottom right hand corner if they want to reach out to you. Ryan: Yeah, I can actually vouch for this. Recently I actually didn't purchase from a site because they didn't have an address. That just, it made me concerned like, "Oh, you're just drop shipping, you're living on the internet, you're a fly by night organization." Just surprised me after I got done. I was like, "They just didn't have an address and that's all that caused me to not buy from them? That was weird." Jon: Yeah. It's surprising, right? I mean, the return on investment in this is pretty darn high because all you have to do is go to mailboxes et cetera, or a UPS store or any of those places, right? And just get a box from them for, what is it? Five bucks a month? And nobody knows that that's the address, right? People aren't Google Mapping this address. They're literally just saying, "Is it there? If it is, okay, I feel better." Ryan: Yeah. And I mean my wife and I, we have five businesses and live where we registered a lot of the businesses. And I have them on the internet, you can find my home address and nobody comes to us. Thankfully. Because I want to keep it that way, keep my privacy. Jon: Well now we're all going to show up. Ryan: Yeah. Ryan: But I think it does. I think it's a very simple thing that I've never really thought about, even until last week when I just didn't buy from a company. And I spent all day online looking at sites. And just the simple act of putting an address in a footer would have gotten that company a sale. Jon: Exactly. Ryan: Okay. Anything we've ignored or haven't touched on on a category page that you think we should be aware of? Jon: Yeah. Don't have popups. Ryan: Just email sign in at the bottom. They're not going to get a discount, it doesn't matter. Jon: Yeah, I think we've done a pretty good job of working our way through the entire page. So I feel pretty comfortable that we've answered the majority of concerns that I would have on a category pitch today. Ryan: And understand too, you'll never be done optimizing your site. You can't. Jon: There's always something. It's interesting you mentioned those tear downs that you see me do quite often at conferences and the like, and I'm never at a loss to find content for those tear downs. You can continually optimize the site and always be iterating on the site for a better experience. It's just a fact of life, but it's something that gives you a big return on that investment. It's well worth it. Ryan: Yeah, it's kind of like that Gordon Gekko thoughts. Like, "How much is enough?" More, well what's a good conversion rate? Better. There's no answer. Jon: One that is always improving. Ryan: Yes. That's your perfect conversion rate. Ryan: All right, Jon, thank you for the time and enlightening me as well as the people that are listening into us. Jon: Yeah. Thanks. It was a great conversation. Hopefully everybody's learned a lot today. Ryan: Thank you.

James:  Hi, audience and listeners. This is James Kandasamy from Achieve Wealth Through Value-add Real Estate Investing Podcast. Today I have Ryan Gibson from Spartan Investment Group. It's an investment group that focuses a lot on Self-storage. They have almost 4,000 units. They have a lot of units in DFW area and a few other States. I think Ryan's going to talk about in a short while, and they recently started to [00:32unclear] in a mobile home parks, which we'll touch upon in a short while. Hey Ryan, welcome to the show. Ryan: Thanks, James, for having me. It's fun to get on your show. It's great. James: Yeah, absolutely. Absolutely. So why not you tell about yourself and your company, things that I've missed out? Ryan: Yeah, so we are based in Golden, Colorado, and we buy existing and develop self-storage properties. And we do all of our properties and projects through syndication. So we raised capital from private investors and we go out and buy storages that we can buy and get existing cashflow on. And then we can eventually either expand them or just improve operations to make additional income. We also build self-storage from the ground up and we do a little bit of RV park investing as well, but storage is the primary focus. So, you know, previously, we were land developers and built condos and flipped houses and focused on storage mostly just because of the recession resistancy, you know, during downtimes. And when we were first looking at the industry, that really is what you know, attracted us to jump into the business. Was the, you know, kind of how it performed during the last two recessions. James: Got it, got it. Yeah. I mean, I did a lot of research of different asset classes. I wrote it in my book as well. Like how many asset class, six asset class for the past 15 years and just on my own, this is not from Marcus and Millichap or this is not from CoStar.  I looked at all the asset class and was looking at all the past 15 years report, which that's a report called Integra Realty Resources. That's the report that all the commissioner pays us a report to, that's the organization. And I was looking at self-storage and multifamily and all that. I was surprised to see that self-storage did do well the past 15 years, even during the downturn. I know at the beginning, you know, 15 years back, they didn't really allocate a specific asset class for it, but they did talk about it. And in general, I didn't see any downturn, even though every other asset class goes up and down. So that's very interesting. And why do you think is that? Ryan: Because it relies on life events and life events never stop happening. No, I'm serious. You get divorced, typically, stuff goes in storage. You renovate your house, stuff goes into storage. In times of good times, stuff goes into storage and times and the bad time, stuff goes into storage. When you get downsized, when you move, when your job relocates, when there's a disruption in the market that triggers self-storage events. And added onto that, businesses use it because not everybody can park their work truck in their HOA driveway, if they're in a covenant restricted community and not everybody can have all their utilities and supplies in their house. And so, you know, simpliest way to say it, you know, for an extra 50 bucks a month, imagine having a whole other room in your house. And that's really been a big driver for demand and self-storage.  We like it because unlike other asset classes, when a customer comes in, we have a lien against all of their stuff. So if they don't pay, we can auction that off for a profit. So, you know, the revenue loss is much lower for you know, the potential when a tenant doesn't pay. With COVID and everything, there was still a rental rate, great increases. We still had high occupancy. We still can host auctions and have people move out if they don't pay. We held back on that in a couple of properties and a couple of markets, but for the most part, you know, we didn't have the government restrictions that a lot of other asset classes had on that kind of stuff. James: Got it. Well, I mean, I'm sure the audience is thinking why not James jump on self-storage. So but let me tell you why I didn't, you can always debate this. So one thing I didn't jump on self-storage at that time. I mean, of course, for me, focus is very important. I mean, every asset class has so many nuances in it. I mean, it's not easy, even though self-storage is like four walls and there's nothing in it, but there's a difficulty in finding the deal and difficulty in executing the business plan and turn around and, you know, disposition and all that. So, I mean, but I didn't do it because at that time there was not much of nonrecourse loan available, I think, unless you go really low on the leverage. So how is that right now? Ryan: You can get a non-recourse right now on ground-up construction James: On ground-up construction. Okay. Got it. What about on the... Ryan: Oh, and of course you know, that would be rare in our industry. Of course, on buying existing self-storage properties, non-recourse is widely available. James: Got it. Okay. So now it's available right now, at what leverage level? Ryan: It just depends. I think we just tied up a deal that around 70 to 75% non-recourse institutional loan. So, you know, it just depends on the lender. Depends on the deal. Depends on the play. James: Oh yeah. I had a friend who was like 85 years old. He's a broker, but he's a very healthy guy. And he said he started multifamily and moved on to storage and he owns a lot of storage unit and I was calling him and he said, maybe at that time, he said, yeah, it's hard to find non-recourse loans. The other challenge in storage is, you know, I mean, anybody can build a new self-storage development in front of your storage unit. It's very easy to build Ryan: Maybe. Yeah. So, you could say that as a general statement, that wouldn't apply everywhere. So there's a lot of moratoriums on storage. There is a lot of restrictions. Some communities don't have zoning for it. Some cities quite frankly, would not allow you to use it at all. So, you know, it just depends on where you are. Some jurisdictions it's, Oh yeah, come build it. No problem at all. So you just need, you know, it just depends on the market. You know, we have markets where there's no zoning and we could build whatever we wanted and there are markets where it's taken us 40 years to get a permit. So it really just depends. And then there are some markets where you get your permit and then they slap a moratorium on there and you can't build your storage anymore. That's happened out here in Washington and a few places.  So you really got to pay attention. And, you know, and I think really if someone was like, what's the one thing that I could take away from talking to a storage operator? It's the market study. It really comes down to: do you have the demand and is there the supply of people and demand essentially in the market to fill up your property or execute your business plan? It's huge. You know, someone might say, is storage a good play? I don't know, make up a city, Austin, Texas and I will say, well, generally, no, it's not, it's actually a terrible market, no offense, but it might be good on one side of the town and catastrophic on the other side. It's a three-mile business so it's like whatever's happening around in that immediate micro-market is really what it comes down to. So some markets are generally better, some markets are generally worse, but at the end of the day, it's right in that five, 10 minute drive time of the property. In the market study, that makes the difference. James: So, all your details that you're telling me right now, that's why I say there are so much of nuances in any asset class that outsiders may not know. I mean, it's easy to say, you know, it's easy to build but there's so much of a market research knowledge that, you know, only the operators who are specialized in it knows about it. So, and I do have a lot of respect for every asset class operators. There are definitely people who are really good at that. So let's walk through a deal in self-storage.  So not in terms of deal underwriting, but let's look at the demographic of that storage. Let's say you found land in a city. Walk us through the steps you would take to say whether this is a good site for a self-storage facility? Ryan: So a couple of things. The first thing I would look at is what's the population. So I would drop in on the facility, we have data and maps that will show us the drive times. And then based on those drive times, we'd get the population within the drive times of the property. And then we would look at saturation levels. James: And what are the drive times? Minutes? Ryan: Yeah, four minutes. I think we use eight minutes and 15 minutes. Think of it this way. If you're in an urban core, you're not going to drive 15 minutes across town, you're going to drive eight minutes so that there's relevancy to where you are in the market. But what we look at is, you know, we'll look at what are the comparable rent comps to what our subject facility is charged. So, you know, we might be getting $15 a square foot on the average but it's important to know kind of what type of facilities those are: three-story glass, Class A facilities, are they first-generation roll-up metal buildings, you know, big difference. Is it non-climate controlled is it climate controlled and in that market, is it a hot market, like a warm climate that likes self-storage to be climate controlled? Or is it a market that prefers drive-up or, you know, climate control would be overkill and people would be unwilling to pay the extra money for that.  So we look at price per square foot, you know, probably just like multifamily. And then, for Spartan, we look at the ability to add onto that property, you know, can we expand it and what is the existing dirt that's there? What is it? Is it flat gravel? Are there stormwater requirements, setbacks, easements restrictions, how usable is that land, and how much would it take to get the land pad ready? Cause we're developers. I mean, we take properties and develop them into bigger... James: What about zoning? Ryan: Zoning is important. That's kind of a little bit further down on the checklist. The top thing is demand. Cause you know, you could have, Oh, this is a zone for self-storage. And of course, everybody knew that. And then everybody built, a bunch of storage is there and there's no demand. James: But is it easy to change as zoning from, let's say in multifamily to self-storage?  Ryan: Ah, that's a loaded question.  James: Maybe not multifamily. I know residential has a lot of high priority in terms of city development. Let's say, commercial office building, commercial land to self-storage. Ryan: I mean, it depends. I know you don't like the word, it depends, but it depends. So like if you are looking in a market where, you know, we entitled the self-storage project in a city that had no zoning for storage. So everything was a conditional use permit. Everything was a public hearing. The public had come in, the city had to make a recommendation to a hearing examiner. Huge process. We've taken a residential land and rezoned it into commercial so we could build self-storage. We had to go in front of the board of county commissioners. We had to go in front of, you know, there had to be room for public comment. There was opposition, but we were successful and got the land entitled, but every jurisdiction is just a little bit different. We've bought properties that are zoned for storage and we've gotten the entitlements and they can take anywhere from two to six months to get it,  it's a building permit, you know, depending on how fast you're pushing and assuming no closures in the city and things like that. It just runs the gamut. You know, as I said, I have colleagues in the industry that have bought property, they got the entitlements. So yeah, you can build storage here. And then the city puts a moratorium on storage and now they can't build anything. So they bought this land, they got the entitlements, they've spent all this money, now they can't even build it.  James: How do you prevent that kind of thing from happening? Ryan: You don't. James: Because you've already bought the land.  Ryan: I mean, you could negotiate the contract to close upon building permits, but then you've got to find a willing seller and you know, of course, that's always a negotiation.  James: It's too messy, I guess. Ryan: But yeah, when you develop, I mean, it can be riskier and there's a potential for a bigger return but you also introduce a lot more risks. So yeah. I mean, is it easy to do? It can be, and it can be very difficult to the point of being impossible so it really just depends.  James: So when you guys raised the money from your investors, have you already done that, let's say for a [13:57unclear]  project. Have you already done that part or are you are still looking at that entitlement? Ryan: Yeah, we've really learned our lessons through the year. So you know, we bought a storage property and when the rezone of the land from, you know, so you have kind of a couple of different phases of development when you're doing like the paperwork to get it ready to go vertical. So the last thing you get is their building permit. So your building permit is pretty straight down the fairway; that is meeting building codes, getting your building permit, not a lot of risk in that - a risk, but there's not a lot of risks. But the phase just before that might be your entitlement so that you can actually do what you want to do, or might even be some type of site plan development where the city has to approve your site plan but you don't necessarily have your drawings done for the buildings they've just approved. Okay. Building here, building here, building here, this is your height. This is your step back. This is how much square footage you're going to deliver and a site plan approval. And then you have the zoning that might be before that. And it might already be zoned that that might be your first step. You know, do I meet the zoning if I don't, I might have to rezone that could take years. So, you know, we just kind of look at the projects and negotiate with the seller to buy the property. You know, when it hit a point where we're comfortable with closing on the land, and then we negotiate the purchase and sales agreement as such, and then we do the raise in accordance with how we feel our comfort level to be. Because we don't want to raise the money until we know we can do what we want to do. And you know, we've really refined our processes for that over the years to know that, Hey, we can close. And we've gotten better at negotiating. Like how can you expect me to buy this land and I don't even know I can do what I want do with it? If it's a hot market, you know, make a decision; you either want it, or you don't. If it's a property that's been sitting on the market for a year, you can come up with some pretty creative ways to keep the property tied up while you go through that process. James: So how many percents of these 4,000 units were developed versus how many were bought from....? Ryan: 25% James: 25% newly developed. Okay. Are you guys more trending towards development rather than buying? Ryan: That's a great question. I would probably say we're buying more than we are developing right now for no reason other than our development pipeline is full enough. Development is expensive and development requires a lot of cash and you don't want too many of them going on at one time. So we have two very large, about $22 million right now with development. Actually, no, we probably have about $30 million in development right now and that's about our comfort level. That's our spend for 2020 for development and we really don't want to get much past that. We also only develop in the states that we live in so Washington and Colorado. Adding onto a property is not a big deal, but we don't like to do ground-up development where we go through the whole process if we live out of state, because inevitably if you want to get things done, you gotta be down at the county, down at the city hall, down at the office, all the time. You're going down there all the time. Oh, you want this? Okay. No problem. James: Otherwise, it's going to just take forever to get a project done. Ryan: And who wants to fly an hour and a half somewhere to drop off a piece of paper and then fly back? I mean, it's just not efficient. So we just like to be in town.  I can't tell you how many times I've gone down there to, you know, shake the trees and get progress. James: Yeah. I've done a small land development beside my apartment. We were converting it. We were combining the adjacent plot of land into the apartment. And that itself was a lot of work already. But the city was supportive and it went through well by just the amount of paperwork, the amount of bureaucratic process that you have to go through. So, absolutely. What about a demographic? I mean, we talked about demographics. How do you say that this particular submarket is a good demographic for a good self-storage business? Ryan: We like at least 1% growth. We like to see trending growth. We like to see 50,000 income. We like to see saturation levels like a seven square foot per utilization for storage. James: How do you get that data? Seven square feet per utilization? Ryan: We have Radius Plus and we use a couple of different programs. Radius and there's one other program that James: So Radius is a software for self-storage investors? Ryan: Yes. James: Okay. For them to see the demand, I guess. Ryan: If you gave me an address, within 20 minutes, I could tell you what's the drive time around it. I could tell you the demographics. I could tell you the demand. I could tell you all the permits in the pipeline. So that's another thing. This is great. I can tell you everybody who's building, everybody who's applied, who's canceled, who is coming. And then of course we do our boots on the ground research where we go knock on doors and go to the city and ask them like, Oh, Hey, you know, is anybody else? Oh yeah, John, you know, he was over here last week. You know, that doesn't show up on record but the intent. And then you go talk to John and you say, Hey, you're really going to do this because we're thinking about doing it too. And we've got into situations like that and you know, either we've given up or they give up or whatever, and we just move on to a different market if the market can't supply all that additional. James: So does the self-storage purchase involves stringent requirements or stringent terms like what multi-families like day one, hard money, you know, very tight on inspection, do due diligence process? Ryan: It's extremely competitive. And it might be as competitive or more competitive as multifamily. Because when people think of storage, they're like, Oh, I've never really heard of that. I don't know what that is. And then they do multifamily and they're like multifamily is really hard. You know, there's always people doing it and Oh my God, there's so much competition. Maybe I'll go try storage because it'll be less competitive. And then they go over to storage and they're like, Oh, there's a lot of people that do this. But what the difference is there are so many multifamily properties in the United States. Self-storage, you can't even hold a candle to the wind. I mean there are 50,000 facilities total in the entire United States. So yeah, when you're talking about competition, if you're looking at a property that's a million dollars or less, no problem. You can go bid on it as a mom and pop.  When you go a million to maybe 6 million that you can reposition or that, you know, show some signs of a mom and pop operations, you're competing against the best of them. You know, the all-cash, close in 30 days, 60 days, whatever it might be. But generally what we do is we do about 10% earnest money deposit...sorry, not 10%. On a $6 million facility, we might put up anywhere from 25 to 50K. And that doesn't go hard until due diligence is completed and signed off on. James: Oh, okay. So that's not bad. It's not like day one hard money, like what's happening in multifamily, right? Ryan: No. And if we were in that space, we wouldn't play that game. So yeah, whether you think it or not, you're competing with yourself at that point. You're worried about losing that money. I mean, we have a 100% contract-to-close ratio, so everything that we've put under contract we've purchased. I mean, we had a bank pull out three days before closing, we went and raised a private loan. We did our own deal. So we've done everything to really help get the deal closed and we've got that reputation to close. And I think that people value our relationship a lot more than they do necessarily how much earnest money we put up. And we've had a broker bring us a lot of deals and just keeps bringing us deals because we make it real simple on them. You know, it's a very simple process with us. We get everything on the table. We are very transparent and as you know, in multifamily that'll go a long way. Any business, right? James: Yeah. That's true. That's true. Yeah. I mean, brokers, love people who are easy to deal with. Because you know, this is just multimillion-dollar deals and you do not want to have a tough person to work with when you're going to such a big transaction. So at a very high level, what are the value add that you usually do in self-storage? Ryan: Cameras for security, rental rate increases. James: So what, you put a camera and you get higher rental rate or it's just...? Ryan: People walk in and they want to feel secure. So our target customer is a 70-year-old woman, that's who rents our properties. So when they walk to your property, is it dark, are there cameras, is it secure? Does it feel like the fence is going to fall over? So we take the properties, we'll put in a new fence, we'll put in new cameras, we'll paint all the doors, we'll replace doors, we'll rehab the office, we'll put in notary services, we'll put in ice and vending machines.  James: Why do you need a notary service in a self-storage facility?  Ryan: Convenience. So we like to be a shop of convenience. So if somebody has got an Etsy, Amazon, they have a home-based business and they can come to our storage facility, they can drop their FedEx/UPS deliveries off at one of our properties. They can get their items notarized. They can ship, they can store. We even have a car wash at one of our properties. So, we try to be a place of convenience for people. Not that we were going to make any money on it. It's just a place where people can go and know that I rent my Uhaul truck to move my goods somewhere. At your property, I can notarize my documents, I can store my belongings, I can do a lot of different things to transact and do my business obligations. And so what we try to be kind of a helpful facility. Not all of our facility does that because not every facility even has an office. But the ones that do, you know, we sell retail. We start, you know, people pay cash, we get rid of cash payments and we go to as many automated payments as possible. We enforce the lease. You know, a lot of these facilities we take over, tenants might not even be on adequate leases. So without being on an adequate lease, you don't have an adequate lien against their belongings. You can't do an auction.  James: Have you guys done auctions? Ryan: All the time. James:  It's like Storage Wars on TV, right?  Ryan: Yeah. Yeah.  James: That really happens? Ryan: Yeah. The semantics are true or the actual process is true, but the way that it's carried out is not true. So nobody goes in person, you know, there are some old school places that still kind of do that, but we do them online. So you can go to selfstorageauctions.net, you can register. And then in your neighborhood, there could be a storage auction and you get alerted like, Oh, Hey, this unit is going up for auction. You can kind of log into your account and see, Oh, what's in there. James: All right. I can see all our audience and listeners are doing that right now. I didn't even know that. What was the website? Ryan: I think it's selfstorageauctions.net. And so as a company, what we do is we say, you know, that the storage auctions is revenue producing or whatever. They're not really revenue-producing. They're basically just to get you to get out and get a new customer in. Like we clear out the, you know, and it's the threat of losing your stuff, right? If you don't pay, you lose your stuff. James: So it's like an eviction process, I guess.  Ryan: Right.  James: Except the government can put the moratorium like what they did in multifamily right now. Ryan: The government hasn't touched us. So usually within 30 to 60 days, if you're not...so let's say, your rent is due today. If you haven't been paid in five days, you get a late fee and your unit gets locked automatically. So the gate code that lets you into our properties, the revenue management system will automatically turn the gate off.  James: Really? [26:40crosstalk]  Ryan: We over-lock your unit. You can't even get into your unit.  James: You don't pay your rent and after five days, it locks by itself? Ryan: Just like that. And then we'll over-lock you. So we'll put a red lock on your unit as well. Some of our properties will have the smart locks where it'll lock behind the door so you can't get in, you can't get into your stuff. So if you don't pay after five days, you're automatically locked out. So we liked that. We don't have to really manage that too hard. I mean, there's, you know, we have property managers are onsite staff that deals with that, but the gate code, that's automatic. And then once you pay it, we'll let you back in. But if you don't pay, you're locked out. So now you don't have access to your stuff and after 30 days we do our notices, our legal notices and then, we can take pictures of your property, do our publications and then it goes on this website and then people can buy your stuff.  And then you know, any earned income from that auction goes directly to us first, to recoup the costs of whatever the tenant owed us and then any costs of legal fees associated with it. And then anything that's left over after all of our money has been recouped, goes to the tenant, you know, cause they gotta be compensated for their stuff. So, we get paid first and then, but most importantly, we get our unit back and in multifamily or residential, they might trash the place. They're gonna do whatever they do. In storage, I mean, you can try to trash the place, but I mean, it's a box. And you know, we just sweep it out. They moved their stuff out and they're gone. And then, you know, for us, we just get our unit back and we let our customers know when they book, you know, Hey, sign up for our online auctions. You know, so they can bid on stuff and they can also know that, Hey, we do online auctions.  So a lot of places we take over, I mean, the delinquencies are a mess when we take over and that's a way to increase value. So we took over property last year, for example. And I just heard from our management that, you know, auctions were like, I mean, there were people that were 180 days delinquent and the manager just wasn't collecting on the units, they just weren't enforcing the rules. So we'll come in and we'll just follow the rules. You know, your lease says this, if you don't pay with this, you go to auction, you know, and then we make money on late fees. And some facilities that we take over don't charge late fees. I mean, if you don't pay on time, you should get charged a late fee. So there's a lot of different things we can do. You know, and plus we'll repaint, we'll redo the doors. Some doors of the old cabinet doors, you know, to open up the lock, the storage locker, we'll put the roll-up doors on them. We'll improve the lighting, we'll redo the asphalt, whatever it might be, we just get it nicer so that the customer feels safe and secure and they feel like they're getting good value for their money.  James: Got it. Got it. Got it. All right. Why don't you tell our audience how to get hold of you and your company?  Ryan: Yeah, sure. So my email is Ryan@spartan-investors.com. Our website is spartan-investors.com.  James: Awesome. Thanks for coming in and adding tons of value to our listeners and audience. Thank you.  Ryan: Yeah, you're welcome. It was nice meeting you, by the way.    

Ryan unpacks the different social media platforms and how you can use them to sell your product. He explains where you should start and then where you can test the waters next. Jon and Ryan also provide an update about what you need to know about the recently released Facebook Shops. TRANSCRIPT: Jon: Hey everybody, just a quick note before we jump into this episode, we recorded this episode on Selling on Social before Facebook Stores was launched, but everything we discussed still applies and is relevant. But stick around until the end, we are going to record an update on selling on social media with some details on Facebook Stores. So enjoy the episode and be sure to stick around towards the end, and you'll get an update. INTRO MUSIC Jon: So Ryan, it's probably a bit maybe cliche to say that everyone is on social media these days, but as a digital marketer, it's true, right? If you're not selling on social media platforms, are you really even trying to succeed? The more I thought about this, the more I thought at The Good we don't do anything around driving traffic, which obviously would include advertising or selling on social media. So I thought, "Why not learn a thing or two from Ryan and your 6,000 clients experience at Logical Position today?" So Ryan, I'm excited to have you, to school me on selling on social. Ryan: Oh man, it's such a big topic and such a big opportunity, I think, that so few brands are capitalizing on, fascinates me. Jon: Well, this will be fun then. So Ryan, let's start with the big picture, when I say social, what channels does that really include? Ryan: I would say when most people say social or selling on social, social advertising, they're most likely referring to Facebook and Instagram, it's the big 800 pound gorilla in the industry. But there are quite a few other platforms that I would probably bucket into that social platform and the advertising and traffic driving that you can execute there. You've got one that a lot of people forget, and it's probably unfortunate there, but Twitter, you can still advertise on there should you want to. Pinterest has some advertising, Snapchat, you can advertise on. LinkedIn is a social channel that a lot of e-commerce companies forget about, there's still some value to be gleaned out of there for e-commerce, but it is pretty lead gen heavy. Jon: Yeah, I love LinkedIn. Ryan: LinkedIn is great for our prospecting and finding just people that talk about it, there's a lot there. And I think it's under utilized for a lot of companies, but it's also, I think, confusing to a degree on how you sell on a business social tool. Do you have any e-comm clients that are doing anything on LinkedIn that you know of? Jon: No, I don't, but I thought that's such a great one that you could run some highly targeted ads on, pretty easily. Ryan: Yeah, if you know who your target market is, and if it's a... Just a conversation with a guy that was selling to doctors today, and I was like, "Well, if you're selling it to doctors and you know that there is a certain role at a doctor's office that always is responsible for finding your product or deciding to buy it, you could target all of those people on LinkedIn very easily." So I think there's opportunity there, I don't think it says much about, on LinkedIn at least, getting click-buy, it's part of the process generally. But with some of the other platforms too, like TikTok, for some reason has just jumped out at me over the last, just two weeks. We've actually had a bunch of clients reach out and say, "Hey, we want to get onto TikTok and do some advertising, how can you help us?" That came out of left field for us, we're like, we know it's there, but we were so focused on Facebook and Instagram with them that we hadn't been pushing for other channels. So, that was on us to a degree, so I think there's some opportunity on TikTok. And then the other one that I think a lot of people maybe think of differently, YouTube has a very strong social component. But it's because it's run through the Google Ads platform, most people don't bucket it under social, but I think there's a component there that, to a degree, could be looked at that way. Jon: Yeah, a lot of people are sharing YouTube videos, right? And it's got a massive comment thread on videos, and they do make social sharing on there easy so that's a good one to think about. Okay, so I had never thought about LinkedIn in the way you're talking about and really hadn't thought about YouTube, so that's really interesting, that's good to hear. And TikTok, I just feel like maybe I'm too old for it, but that's a whole different situation. Ryan: You and me both, that's probably why I didn't have it top of mind. I was like, "TikTok, what are you talking about? That's just Gary Vaynerchuk trying to get people to like his social stuff. Jon: Yeah, but I mean the minute he's talking about it, it's probably the immediate time to jump into it. Okay, so when I'm thinking about selling on social, are we really talking about advertising or actually selling, right? So for instance, I've seen brands that do Instagram Ads, right? And I've seen brands that actually make their posts shoppable, and you can actually complete a transaction on Instagram now. So are we really talking here about advertising or are we talking about actually selling? Ryan: Well, I think it's both. I mean, I like the old adage, always be closing, always be selling. Like if you're an e-comm site, you need to constantly be thinking about how are people going to find me and buy my stuff. And I think if you have the ability, because not everybody can check out on Instagram, or every brand doesn't have that access, let me put it that way, not every site can just flip a switch and automatically be selling on Instagram without leaving the platform. It's still in controlled level, you have to have enough followers or you have to be invited into betas to a degree. But you want to sell as often as possible, and I think having that extra channel, if you can get that conversion on Instagram without them leaving, you do it. But all of them I think you're going to be advertising on, even if you can have the checkout on Instagram rather than your site, you're still going to be advertising to draw people to that checkout or to your page, and constantly try to find new users. And I think Facebook and Google both have a lot of creepy data, it's not a surprise to anyone, and I think Facebook even gets slightly more creepy, but it is phenomenal for marketers. We can upload a list of our clients, and then Facebook's algorithm can go find everybody on the world that looks like your current customers because they're more likely to be buying. If I buy your product and like it, you go find everybody else that has the same demographics as me, whether it's on a farm, has four kids, has too many businesses, there's maybe 10 of us out there. Jon: But all of them will buy. Ryan: But all of them will probably buy your product. So be thinking about both, I think, because of the algorithm. A lot of people forget about this, but the Googles and the Facebooks of the world, the dominant ad platforms, they've created a free platform for everybody and they make money by ads, and so they have an incentive to get people to click ads. And so on Facebook, not everybody that follows your brand, Facebook and Instagram, not everybody that follows you will see your post. And so promoting posts, getting your ads out there, you have to feed the beast, to a degree, and make sure that you're leveraging the ad platform appropriately to get the right content in front of the right people. Jon: Got it, okay. So where do you recommend brands start then? What channels and how would you best utilize those channels if you're just starting out? Ryan: Some of it depends on the size of the organization and the budget to start with. If you're already a $10 million online brand and you hadn't advertised on social, that would surprise me, but it probably exists somewhere. You could probably start a little more aggressively than somebody that hasn't hit their first $100,000 in online revenue yet, but the general rule of thumb that I have for most brands is start with remarketing on Facebook and Instagram. It's all done through the same platform on Facebook, since they own Instagram, and if you're remarketing to people that went to your site and didn't purchase, you'll get a good gauge of what kind of potential Facebook and Instagram have. So if people that went to your site didn't buy, come back and buy through remarking ads at a rate that makes sense for your company and your products, it indicates there's potential for prospecting or finding new users that haven't heard of you yet. But if people, through remarketing, are not coming to your site and buying, it would lead me to hypothesize that finding new users is not going to be the best opportunity for through that social channel, because remarketing generally always works better than prospecting as far as the return on investment. So start there, and also understand that when you move beyond just the remarketing pixel on the remarketing ads, social is not like search, it's not a demand capture. People, for the most part, are not going to a social channel to find a product to purchase, generally you're interrupting their flow of connecting with friends and family or coworkers, and convincing them to click an ad to go outside of that flow to look at a product, it's something they probably hadn't been thinking about before. Jon: Yeah, that's such a great point. You really think about, at least in my business, around conversion, right, it's all about that capture and not the creation portion. And that's a really great point that if you are able to create that demand and then make it easy to do the capture or conversion at that point, then you're really going to see some great return on that ad spend here. Ryan: Yeah, and understand too, that generally as you move up the funnel of purchase, the return on ad spend drops, but I think it becomes more important as you're driving people to your site off of a social channel, to focus on that conversion optimization. You want them to be sticky and you want them to buy then, if at all possible, remove as much friction as humanly possible on social traffic because once they leave, go back to the social platform, you're no longer top of mind, now you're going to be remarketing to bring them back in. So it probably extends the purchase life cycle, if I could say it that way, when they're coming from a social channel. Not always, depends on how impulsive the purchase is, but you just have to generally be watching data very closely on social as you're looking to get sales there. Jon: Okay, so let's say a brand has been successfully selling on social already, what's the next step you would recommend? Ryan: Probably the same as with all of your marketing, it's test, test, test again, test again, test again, and not ever be satisfied with where you're at. You'll be trying out new ad sets, maybe if you haven't done video before, you need to do video, you're going to be testing new platforms. And so this is one where it's easy to get stuck on Facebook and Instagram and assume that that's your social media marketing, that's it, you're done, you've got it covered. But if you take me for example, I don't know how many years ago, maybe... gosh, I'm getting old, but what is it 15 years ago that we started on Facebook, maybe? I don't remember when it came out, but probably a while ago, and I was on Facebook for a while, thought Instagram was really stupid, why would people just not want to read anything, they just want to look at pictures, and then realize, "Oh, Instagram is pretty cool." I no longer really go to Facebook, I am on Instagram because it's easier to scroll through the feed maybe, but I'll go in maybe once a week and check on Facebook. My mom's on Facebook now, she's not that interesting to me to follow on Facebook. She's retired, she sits at home and it's just not as interesting. And so people are going to constantly be moving from platform to platform, I think. And I think as Instagram ages, we'll probably move to something else. People have moved to Snapchat, maybe it's going to be TikTok. Jon: TikTok, there you go. Ryan: Who knows? But you want to be making sure that you're aware of the demographic shifts, maybe the baby boomers start moving on to Instagram in a heavier flow, and all the gen-xers like myself were going to fall off and go somewhere else because we don't want to be hanging out with our parents on social media. Jon: Yeah, this is what's really interesting to me about social media, it's so easy... and I think as an outsider, obviously I'm not printing campaigns, but it's so easy to target different demographics because it's pretty clear what channels they're on. If you want to advertise to the teenager, you're going to advertise on TikTok, that's just generally where they're going to be right now. They're not going to be on Facebook, we know that. But if I want to advertise to Ryan's mom, I'm going to go to Facebook, right? It's just where it is. So yeah, that's something to definitely think about, but what I'm hearing from you is the core tenants of digital marketing apply to social, right? So whether you're doing ads from Google or you're doing ads on Facebook, it's really the same core tenants, it's just a little bit different, perhaps, on the execution. Ryan: Yeah, and the important metrics are going to be a little bit different. So whereas Google's algorithm is fairly advanced, and we have a lot of really quality data around quality score, for example, we know what goes into it, we know what makes up a quality score, and how to manipulate it to get a higher one. Whereas some of that information on Facebook isn't as readily available, and there's more testing and measuring to figure out what is going to work and what's going to be a good click through rate. It may be different for different ad sets, and there's a lot more visual ad types you can create on Facebook than maybe just text ads and shopping ads on Google. Understand it's different, but it's all the same thing, we're always looking at data and deciding what to do based on what the data is telling us. And on their demographic point too, there are young people on Facebook. And so if you do want to target younger people, you just set your targeting for younger people. You may not spend as much as you could on, say, Instagram or on maybe TikTok and be going to teenagers, but there's millions and billions of people on each platform so there's a lot of eyeballs. Jon: So would you recommend then that when a brand is looking to choose a social channel to sell on, that demographics would be their first elimination point? Or I'm hearing from you that, obviously there are, yes I agree, there's younger people on Facebook as well, perhaps, but would you still recommend demographics be that first deciding point where to start at choosing a social channel to sell on? Ryan: That's probably going to vary quite a bit depending on the brand and what you're selling. I mean, almost across the board, I'd probably recommend most companies start for the first time on Facebook, Instagram. It's a mature platform, you really know what to expect out of it, people expect to see ads, click ads and go somewhere else, and get basically their flow interrupted, it's not an uncommon thing to see an ad and click. I mean, I remember one of the best ads on Instagram was somebody that showed me a paddleboard surfboard with a rocket engine on the bottom of it. And I was like, "I didn't even know I needed that until I saw that on Instagram, and now I need to spend $2,000 on that even though I don't have-" Jon: Now you can be lazy during your workout. Ryan: Exactly. So start with what's known, where there is a lot of talent to execute for you, because there's not a lot of people right now that are TikTok marketing experts on the planet. And so if you're going to go off and start on TikTok, it may be much more difficult to get the goals that you want achieved there. Start there and then branch out as you see data, so set the demographics, knowing let's say you're going to target the younger demographic, and so people that are 18 to 24. You start on Facebook, Instagram, set your target demographics there, see how many there are, see how they respond, because you have a lot of... a mature platform is just easier to work on generally, knowing that you probably want to end up on TikTok as well, Snapchat, and expand out of that once you have a baseline to say, "Okay, I know that Facebook, Instagram, I get this return on ad spend, let's see how TikTok actually works for my brand as far as a return." Jon: So, I get asked this question all the time, Ryan, what's a good conversion rate, and people don't like my answer, generally, because- Ryan: Better. Jon: Yeah, one that's improving, right? That's generally how you should be thinking about it. Is there a goal for brands when it comes to selling on social, should we be thinking about specific goals or is there a percentage of a brand's overall revenue you prefer to see coming from selling on social? What are the metrics that you think are most impactful, and are there general standards for those metrics that people should be aiming for? Ryan: Unfortunately, no, it is very similar to the CRO question that it's an improving one, and you've got to look at your brand and who's buying, why they're buying, and where are they buying. So if you sell CNC machines online, you're probably not going to get a lot of direct conversions out of social for that. But it's an awareness thing, you can do some good top of funnel work there, that maybe it's not necessarily the final attribution is coming from social, but it is on the path. And so I think it's only going to get more and more complex as we continue to get more ways to engage with people through different channels, that I would probably never be able to put an exact number on it. But one thing I do like doing, and I do this in my own brands, I keep each marketing team siloed to a degree, so the Google Ads group, the social media group, I generally, personally at least, don't want the same team doing both because I want them both competing for a share of my sales. I want them to say, "Hey, the social should be bigger." Okay, if the same person's running Google and social, they may not care which one's bigger, they just want to push where it's maybe easier. And I think there's always a chance to win on social or win on Google, but I want hungry teams that are going to make that channel work no matter what. And so I would say, I always want it to be more but I also don't want to lose money. Anybody can sell a million dollars through Facebook, but some companies, it might cost you 20 million to sell that one million and so it's not worth it. So you just have to be aware and monitor what's happening and where that social channel fits for your brand. One of my brands, I haven't even gotten it on social advertising yet, I'm still Matt trying to max out Amazon and then I'm going to try to max out Google, and then I'm going to try to push on social. So there's so much you can do that it becomes mind boggling at some point to where you can be pushing a brand. Jon: Awesome. Well, I think we've sufficiently tackled this topic. Do you feel the same? Ryan: I mean, it depends on who's probably asking that question, but I feel like at least we've covered a topic and we've gotten some good insights. Jon: So Ryan, we promised at the start of this episode that we'd provide an update on the just released Facebook Stores, and I'm counting on you to educate me because quite honestly I heard about it, but I did not read anything about it. So can you give us a quick overview of what Facebook Stores is? Ryan: Yeah, so welcome to the world of e-comm, where things change more rapidly than we can produce podcasts, but it means it's fun and things are constantly changing. So Facebook Stores is basically what it sounds like, it is a store for your business on Facebook properties, mainly Facebook and Instagram. Allows people to checkout on the platform, many companies were, at least, aware of the checkout on Instagram feature that was in closed beta for a while, so it's basically all of that rolled into one. Facebook has an entity they're trying to release quickly to help local [inaudible 00:21:06] that maybe never had a website, offer the ability to transact online, at the boiled down version of it. Jon: Okay, and do you think this was in reaction or response to COVID and a lot of retail not being open? Ryan: I think that was the initial thought, but I think it was also quite an opportunity for the Facebook engine to push into e-comm with a lot of people paying attention, and that's a very easy release at that point. Jon: Great, and so it's separate, because I know Instagram is owned by Facebook, but it's separate from, or is it somehow linked to Instagram? I know you could sell on Instagram for some time now, not necessarily in a store, but you can do shoppable posts. Ryan: You can do shoppable posts, but those still take you to your website for transaction. There was that swipe up feature that was very popular, if you get over 10,000 followers, you get automatically put into it if you're a verified Instagrammer. A lot of value to those, we've seen some great data, but this is the next iteration of that, which is you don't have to leave the Instagram platform to transact. Once you've transacted on Facebook or Instagram, they store your data if you want them to so you can easily transact without having to put any data in. So just kind of try to make it as seamless as possible. So a great [inaudible 00:22:26] I believe, but one of the things people are going to realize as they start doing their research is when you have such massive organizations that try to move nimbly and quickly, there's some struggle. So by no means is Facebook Stores just [inaudible 00:22:41] working for everybody as they think it would at this exact moment. In fact, even me personally, my wife and I are trying to get our businesses up on Facebook Stores, like with Shopify a couple days after it came out, did not work. It was not just a click a button, you are going. You've got to have some things in place that will allow your business to work, and so obviously you've got to a Facebook page, so if you don't have [inaudible 00:23:08] out there. If you're going after people that are in the younger [inaudible 00:00:23:14], younger than baby boomers, you should probably have an Instagram profile. You need to have a platform that can easily get products into Shopify, and so this where Facebook and their post called out a few partners in the intro that came out right after Zuckerberg's live thing, where they say, "Hey Shopify, BigCommerce, WooCommerce, ChannelAdvisor, CedCommerce, Cafe24, [inaudible 00:23:44], and Feedonomics can all [inaudible 00:23:46]. I don't think all those integrations are perfect yet, and I've tested on some Shopify sites where you can add the Facebook Commerce Manager, get the Facebook shopping plugin, the Instagram shopping plugin and it's be live [inaudible 00:23:59] not perfect. So I think that most businesses have to realize going into this is, if you've never been online before [inaudible 00:24:08] to accomplish that you've ever done. If I'm seeing articles and blogs from people, the e-comm experts not being able to do this, the switch, just with their knowledge, then I would say at least test measures and things, test [inaudible 00:24:22] things. If you get stuck, there are going to be a lot of blog articles, there are going to be a lot of help things within Facebook trying to solve these problems, but you're going to need some patience for sure. Jon: So Ryan, knowing all of that, how does one get access to Facebook Stores? Ryan: You need to go in and set up Commerce Manager, and so that's step one, like a great digital marketer that I am, I just go Google, Facebook Commerce Manager and find it. It wasn't as simple for me to find inside the Facebook platform, you also want to have a site like a Shopify, BigCommerce that already has a plugin for it, so you may need a plugin on that. Our Shopify site, we had to put a plugin on the site to get to send inventory over to Facebook, you've got to have something sending those product details over, along with inventory, what's available. Every business that has a Facebook page should be able to do Facebook Stores, but that doesn't automatically open up Instagram Stores, or so we're finding. There's a lot of misinformation out there, so you need to do some research on your own and see your business is able to do certain things. There were some articles that my wife came across that said, "Okay, if you try to do an Instagram Store, you can't do a Facebook Store and vice versa." I don't think that article is necessarily true, but the Instagram Stores or the Instagram checkout is still closed beta if you go to that page on Instagram. Jon: Okay. So, we should state that there's a lot in flux here, right? And we're doing our best to get this information out quickly, but things are changing rapidly is what I'm hearing from you as well. Ryan: For sure. So we're recording this today, and people are going to get access to it probably in a week and there's going to be constant change until we get to a homeostasis in the Facebook Stores environment, and so we'll probably have to do an update a little bit later. But as of now, just know that there's a lot of moving pieces at this point, and if you're on a platform that doesn't have an integration already built into Facebook, it's going to be much more difficult for you to get that thing set up. Jon: Okay, so what does Facebook cost? I assume they're not doing this for free. Ryan: It'd be nice if everything was free, but unfortunately Facebook is a business, and they have an obligation to shareholders to make money, nothing wrong with that, they do provide a service for free for people getting their own profiles. But as of now, they are charging 5% per transaction, now that is great in some areas, it does say that includes taxes and processing fees. And so that could be good, but I do have some struggle with that because if your business already has nexus in Washington, for example, you need to be collecting all of the sales taxes in Washington, which add up quickly. If you sell in Seattle, you're getting charged almost 10% sales tax up there, that that 5% just can't cover taxes. So that's how I know a lot of this is going to be changing and updating, because I'm not sure that it built out everything for tax collection perfectly. Because when you jump into e-comm and you have stores like mine and they sell on Amazon, their website, retail storefronts, I mean there is so many potentials for tax nexus they had to be collecting that Facebook sells a unit there, I'm on the hook actually as a merchant for that. And so that's where stores need to be aware that that's there. If Facebook doesn't collect the tax, nothing on them, I mean, they're not coming to Facebook for that, they're coming to the person that actually sold that product on Facebook for the tax. Jon: Right. So definitely something to keep track of, and I think we both know in e-comm, and there's whole companies dedicated to just helping you figure out your commerce tax situation. And it's down to the street level at times, local taxes and sometimes stuff like that. Ryan: Yeah, good luck in California, it's just not going to happen. Jon: So since this was released, and it is in beta as we were kind of talking about, what do you think is still being worked out with Facebook and their Stores platform? Ryan: Some of it, I think, is going to be that cost, like they want to have something that works and keeps it simple. But as of yet, I haven't seen how you can simplify commerce to a flat rate for everybody in every possible scenario. So I do think that's going to adjust somehow, and Facebook is potentially opening up for a local store that's never had a website, to sell across Facebook, which is a massive opportunity, but also adds in massive complexities to a small local business that [inaudible 00:29:10] had to consider before. Especially if you're in Oregon, where we don't have sales tax, that's just kind of a foreign thought to us that, "Hey, I can go anywhere I want, I buy something and whatever it says on the tag, I actually pay versus not having to worry about tax." Whereas I go to Washington, there's all kinds of taxes added on that as an Oregonian I'm just not thinking through. So an Oregon business, you have to be aware that most of the country charges sales tax, and if that collection's not there, how do you do it? And maybe Facebook has taken some liability in some of their fine print saying, "Hey, we're going to charge 5%, and we'll make it right, some how, some way." I don't necessarily think that Facebook shareholders [inaudible 00:29:50] too keen on that. Jon: Yeah, not for permanent, right? But I could see them doing that upfront to get users and to kind of buy their way in. Ryan: Yeah because it would be great if you could simplify processing and taxes into just one number to [inaudible 00:30:05]. You're just taking 5% and I'm done, that would be huge, and I think a great opportunity. Jon: I have to think, yes, we're in Oregon, so not really up on every other State sales tax, but I have to think that there's some States that have more than a 5% sales tax, right? So even just then, they would be losing on processing or any of the over right away. Ryan: Yeah, and it could be maybe they're pulling that from their small business fund that they talked about, where they say, "Hey, we're going to release a 100 million to small businesses." And so instead of giving them ad credits, they're just going to use some of that to collect the data. Because I think some of it Facebook needs is that data, because they've not done enough online commerce to actually have the data to know this is what it is and here's where things can go bad. Unless they hired some high up people at Amazon that have all this data that they could pull with them, I doubt it. Jon: Yeah. Well we all know that, and this perhaps is for a whole nother podcast, but we all know Facebook loves their data, so they'll get it one way or another. So is there anything we didn't talk about, you thought I should have asked you about Facebook Stores today? Ryan: I don't think so, I think as a business there's very little reason not to get into this channel and test it. Every business is going to have a different level of success with it, but if you're going to open up a massive channel, I think there's more risk to not exploring it than there is to explore it and put some of you inventory there and see what happens. I mean, I'm going to get all of my businesses on there that I can to say, "Hey, I want to be available where people are trying to transact." And if Facebook is successful at creating an e-commerce platform to rival the Amazon's or Google Shopping's, then I for sure want to be an early adopter into that system so I can get as much data as I can get to make smart decisions for myself and any of our clients. So I would say, get in, take some risk, take the time to study it, and just see how you can make it work for your business and your specific situation. Jon: Yeah, that's great advice. I mean, there's still millions and millions of people on Facebook, so it's a massive audience, right, and you might as well try to throw your store up there and see what happens. So, okay, great. Well, this is really helpful and I think it's a great add on, as we said, things are going to change rapidly with this, but hopefully this gets people started. They know where to look now, they have some understanding of what it's going to cost them, and why they should do it, and I think that's a great add onto this episode. So thank you, Ryan, again. And I look forward to doing an updated show in the future as things settle down with Stores. Ryan: Yeah, looking forward to it. Thanks, Jon.

Jon explores the nuances of CRO and explains why it can be so difficult to take a DIY approach with it. He also offers a few tips for those just starting out to improve your CRO without spending a whole lot. [The Mom Test book]: (https://www.amazon.com/Mom-Test-customers-business-everyone/dp/1492180742/ref=sr11) For more CRO help visit The Good: https://thegood.com/ TRANSCRIPT: Ryan: Hello, Jon. Jon: Hey, Ryan. How are you today? Ryan: I am doing well. Excited to get educated today by you, on some areas that I have very little knowledge. It's exciting, the world of CRO. When you see the results on my side... I get to see the results of what you do, but I don't conceptually understand it well. So today, I really wanted to dive into the weeds with you about conversion rate optimization, and help our listeners get a better understanding of just what you're going to need to do to help execute some CRO. And then, as we live in this DIY world... I can't tell you how many Pinterest things I see, or YouTube things I see, that I try to execute, and it just, God, doesn't quite turn out the way I want to. Especially when I'm cooking, all the recipes I find on Pinterest, just man, the pictures look so great and then my finished product is not great. Ryan: I own a few businesses. Logical Position does a lot of advising on best practices in improving conversion rates, but I wouldn't call what I do on my own sites or what we do at LP to kind of advise clients as conversion rate optimization. So from your perspective, as an expert in CRO, isn't it easy to just watch a YouTube video or find a Pinterest article on CRO and just do something and watch the conversion rate on your site increase? Jon: Well, I think that, just like anything else, right... Like you mentioned Pinterest or YouTube videos, how many times did you watch these videos and it had not turn out like you had wanted, right? Ryan: Yeah, most of the time. Jon: Yeah. I think, it's probably not too dissimilar. Now, look, there's a lot that somebody can do on their own to help improve their conversion rates. Is that technically and truly full conversion rate optimization? No, of course not. But there's a lot that people can do out there, and should be doing, and should be thinking about. I think that... Look, is it easy to do everything yourself? No. Could you focus on one or two areas and do very well? Yeah, maybe. Jon: But I think the biggest challenge I have, is we see this all the time at The Good. People come to us and they say, "Hey, I have one staff member I hired who's a conversion optimization specialist, but it's just not moving the needle in the way that I would like. We're not seeing the return on that salary spend or that contractor spend." The problem is that, and we've proven this out over 11 years now, you really need to have a team with a whole bunch of specialists, and it's impossible for one person to be expert in all of the areas that you need for conversion optimization. Ryan: What I'm kind of understanding is there is a conceptual difference between CRO, or conversion rate optimization, and, maybe what I would call CRI, conversion rate improvement. They're not necessarily the same thing. I can [inaudible 00:03:21] can change a button and improve our conversion rate, but that's not actually conversion rate optimization. Jon: I think we just came up with a new term and I love it, CRI versus CRO. That's awesome. Thank you, Ryan. Okay. Yes. Now, here's how you can do improvements, go out and get these tool sets that all talk about doing an optimization or improving your conversion rate. There's tools out there that can help improve your conversion rate, but they're not going to get to the level that a customized program with a team of experts can do for you. So you think about all those tools like Privy, or there's Hotjar, or Crazy Egg, or... I could go on and on, right? There's tons of these tools out there that each provide a little nugget of conversion rate improvement, but they're not truly doing full optimization, right? Jon: If you're really going to optimize anything, it needs to be a scientific process of optimization. It's not just a make these changes and you're done. It needs to be the ongoing iterative improvements where you're making incremental gains, month over month, that compound and grow. That's where the big numbers are going to happen and the massive results are. I mean, you look at this and maybe this might feel daunting to the entrepreneur who's doing a $100,000 on their site right now. But Amazon has a team, a massive team. Last I heard, it was well over a hundred, doing nothing but optimizing the Amazon experience. Ryan: Holy smokes. Jon: So you think about that, and you're like, "Man, I'm at a huge disadvantage here." But the reality is, they're looking at every little data point. That team has a wide range of people doing different items, you have data scientists to analyze all the data coming back. You have test developers to build out all the tests. You have conversion strategists who can help you to better understand what should be tested. You have experts in user testing, those people who speak to your consumers and understand how to get information out of their heads about what they're thinking. Jon: So you have all of these other types of roles that exist that can combine, be like the Avengers, right? But individually, if you just have the Hulk out there or... I'm not a huge comic book guy. Maybe I'm mixing up my worlds here. But, I would say individually, they're not going to be as great as they would be all together. Ryan: Interesting. So almost in putting it in terms I can quickly relate to would be PPC optimization. You can know conceptually that I really do need to be putting negative keywords into my account to eliminate some waste, but there's a lot more to that, and there's a lot more specialist in the die that I operate in so often. But also, as I'm looking at all the accounts we work in, the way we operate is very different on somebody that sells $50,000 CNC machines versus a five-dollar mug on their website. Jon: Exactly. We talked about this a little bit at one of our recent episodes, where I was interviewing you and I admitted to how I had a button checked in our ads account and it cost me $2,000 that I didn't need to spend. Ryan: That was a fun one. Jon: Right. But here's the thing, I thought I was doing the right thing by letting Google manage that. And it just kept bidding me up, bidding me up, bidding me up until I spent all this money. Where an expert who's in it every day would know, "Hey, on the surface level, I get why you would want Google to own that and optimize that for you. But the reality here, is there's a much better path ahead if you have experience here." I think that's where it really comes in, is having that experience and it means that you can rely on the tool, right, and you could just have a whole bunch of tools. The challenge is going to be, that you're not going to see the gains that you would if you work with somebody who does nothing but optimization and has a team centered around that. Jon: Think of it this way. I spent 2,000 extra dollars I didn't need to spend because I misused the tool, right? I could have spent that $2,000 with an expert who maybe could have generated me an extra $5,000. That would have been a massive return on my investment, by making the investment there, as opposed to clicking a button that I was trying to take the cheap way out, right? Ryan: Mm-hmm (affirmative). I guess, in the e-commerce space, we have some very major players like Amazon, a hundred people or more on their conversion rate optimization team. Shopify has a million businesses utilizing their platform. And I assume, again that's an assumption so nobody quote me, but I assume they have an internal CRO team to a degree, because the more conversions they get, the more people use Shopify and the more money they make on the payment processing. Ryan: So with all of these major platforms having so much influence, do you ever think it's possible that we fast forward five years and all of us just are so trained in Amazon and clicking this to get this, or Shopify clicking this to get this, that it's almost standard like across e-com. Like checkout, I expect this, I do this, and there's very little optimization beyond that. Jon: I hope that we get to that point, I don't think we will. Now, here's why I hope, because... I've mentioned this book a hundred times, that's called Don't Make Me Think, right? The whole premise is that we have conventions as internet users that we've become akin to that we know and we like, and it makes the internet easier to use if everybody follows those conventions, so I don't have to think about it, right? Anytime you change that convention, you're making the user of your site think. And that delays them converting. It makes them frustrated. They bounce. They leave. They desert, whatever you want to call it. Jon: I hope we get to the point where there's a standard here, but I can promise you we never will. Now, here's why, they can standardize things like checkout, right? Shopify has done a wonderful job with this and this is where their optimization team internally would come in, where they are optimizing the checkout experience. However, if you go to a Shopify site and they have a custom theme and it's branded, you wouldn't even know it's on Shopify until you got to that checkout and then you know it's a Shopify checkout, right? Ryan: Mm-hmm (affirmative). Jon: And here's the thing... So there is so much to optimize beyond that. We're never in on the internet. And I hope we get to the point where things are standardized, but I never hope we get to the point where the internet just becomes this big gray area of everything being the same. Ryan: Yeah. Jon: Then it's not going to be cool. We're taking the branding out of the internet, which is part of what makes it really fun, is to go to a brand's website and get a feel for that brand, have an understanding of what their value proposition is. I hope we don't get to something where every website is just black text on white screen, with blue links, and the navs all look exactly the same, et cetera. I do think it's important that some things are standardized and some usability aspects of websites are standardized. I think that's important and we're making strides to that, but there's always going to be that brand pool. And it's going to be a push against that standard experience that makes people think a little bit. Jon: I really don't know how the experience, if you will, is going to be that much better over time. But I do think, if you're a small shop and you're using a BigCommerce or a Shopify, yes, use their default checkouts because they're pretty good. But you're going to get to a point where you're noticing some checkout cart abandonment, and you want to improve those metrics. And at that point, you're going to want to start to optimize those a little bit. That's when you move up to something like Shopify Plus, where you're paying a little more every month, but you get the ability to customize your checkout. And then you can start adding in some additional tools, you can start looking at moving some fields around, asking for less information if you're not using it or don't need it. Jon: And then on BigCommerce, one of the big things about BigCommerce is the customization that you can do with the platform. So their checkout, out of the box, if you're a BigCommerce subscriber, you can alter that, which is great. It gives you a rope to kind of hurt yourself with a little bit there. But in time, it can... If you're a smaller brand, you want to start using some of these tools, you have that capability. Ryan: For some of those bigger companies on BigCommerce, you can use something like a Bolt that is really focused on one thing only, and that's streamlining that process. Jon: I'm glad you brought up Bolt, because that's a great example of how they can take something that we just spent five minutes discussing as a standardized experience, and they've made it better. That's a great example, where there's always going to be room for improvement. How bolt has even done that, is they focused on reducing risk, right? Ryan: Mm-hmm (affirmative). Jon: So you're able to ask less information of the consumer, than you would on the standard Shopify checkout. That means you're going to convert higher, but you don't have to eat the risk of the fraudulent transactions as part of that, right? So you have options. And I think that there's always going to be room for improvement, I really do. Ryan: Well, I think it's also at this exact juncture to remind people, as I constantly had to be reminded, that conversion rate optimization is not checkout optimization. There is every step before, and I think this was a couple episodes ago, and a couple of steps after the fact of checkout, that conversion rate optimization plays. Jon: Yeah. [Crosstalk 00:13:39]... Ryan: So, often we as e-com companies and business owners focus, "Oh, I got to get people to check out, and then it's done." [inaudible 00:13:45] is over. But there's that huge process. Jon: Right. Yeah. We've talked about this a few times where... What happens when somebody gets to your site? What's their intention when they're there? All the way through what happens after they check out, how do you optimize post purchase checkout? And I think there's so much that can be done there. Again, very likely that it will never end in opportunities for optimization here. Ryan: Not every company is in a position to be able to start the full CRO agency or hire enough people to fully optimize their entire funnel of conversion, before and after giving the business money. Are there certain areas of CRO, outside of maybe just getting a Privy or a Hotjar or any of those other tools, that they can be doing something that would get them going towards official CRO? Like you've got to be able to grow the brand into a size to be able to afford a CRO agency or employees. So outside of just the tools, what... Is there AB test they can be doing? I mean, what does that look like for the e-commerce business owner doing a hundred thousand a year? Jon: Well, I think that most likely, you're not going to want to even dive as deep as doing something like AB testing, because you don't have enough traffic to prove those out, it's not going to be a good return on your time or funds investment. Jon: Now, what I would recommend here is two-fold. One, start tracking some data. This is not complicated, but it will help you later just to have more timeline of data. Go into Google Analytics, turn on things like enhanced e-commerce, set up some additional dashboards. Just Google e-commerce analytics dashboards, you'll find a bunch of great ways to set that up so you start tracking some good data, okay? There's a easy checklist to follow there. Jon: Now, other thing is start tracking user engagement. How do I mean that? Well, go sign up for Hotjar, it's $9, right, per month. Just sign up, go, and what you can do is you can start understanding how people are engaging with the content of your site. And I promise you, if you just spend one hour a week reviewing that data, you will learn where challenges are on your site, with things that you think you can do yourself that will improve conversion rates. Jon: Are you going to see massive gains? No, but I think if you're in the situation where you have more time than you have money, as you're growing your business and you're starting out, spending that hour to better understand your consumers yourself will help you find a better product-market fit, it will help you to improve your website overall. And as you continue to grow, you're already building that culture within yourself and your company with your team, as it grows, of understanding how consumers use your website and what data you should be looking at. Jon: If you just go out and you start talking to consumers, take a laptop, go to your local mall, or, I don't care, bar, doesn't really matter. Wherever your consumers hang out, right? Go to the coffee shop. Sit at the Starbucks and just say, "Hey, can I buy you a coffee, if you give me five minutes of your time, while they make your coffee. You're just going to be standing there anyways. I'll buy you a coffee. While they make it, I want you to use my website. I'm going to ask you to complete a task, and I'm just going to watch you do that. I just want you to tell me what you're thinking as you go through those steps." You will be amazed at what you learn. And all it takes is five, 10 minutes of someone's time and the cost of a coffee. So anybody of any size can do this. Jon: Now, you don't have to just be there all day, either. Do this for a couple hours. Get under 10 participants, and I promise you, you will walk away with a laundry list of improvements that you can make to your website. So if you don't- Ryan: It's almost like gorilla marketing in its purest form. Like, "You've never heard of my business before, I'm going to buy you a coffee and you're going to see it." Jon: Yeah. You're not trying to sell them anything, right? You're just trying to understand how they're using your website so that you can take that data and improve. The idea here is that you're getting an understanding of somebody who is a new to file customer, somebody who's never been to your website before. You're walking away with an understanding of what their first impressions of your site and the experience on your site. So the navigation, the funnel, how they find the right products, what they think of the content, right? All of those things are what you're looking for. You're not necessarily saying, "Hey, I want to introduce you to my business, so you buy something," because then they're not going to really have a great understanding. Jon: Now, there's an amazing book out there. It's called The Mom Test. You can get it on Amazon. It's 20 bucks or something. It's amazing. The Mom Test, we'll have our producer put it in the show notes. The Mom Test, it's got a pink cover, it looks like it's a not really helpful book, but I will promise you that it is amazing. The whole thing about this book, is that it gives you an outline of how to ask the right questions about your product and your website to get customer feedback, so that you're not asking them leading questions, that they're only going to give you positive feedback. Jon: So why is it called The Mom Test? Because this should be questions that you can ask your mom where you're going to get good feedback, not where you're going to get the mom feedback of, "Oh, honey, that website is awesome. Yeah, of course it's beautiful, you built it. This is the most usable website I've ever had." No. You want somebody, even your mom, to give you the best feedback about how to improve your product and what they actually think. That's where it gets important. So asking the right question is really the key here, but that's something that 150 page book can teach you, and you're not going to be expert right away. But again, going back to where we started this conversation, that is just one small item that you need to learn and master out of the whole range of conversion optimization. That's why it gets really hard to do CRO versus CRI. Ryan: We have to trademark that. Nobody think. I want to go back, really quick though, to a point you made about traffic being too low for CRO, because I know you have this conversation constantly. And then I get to talk to some of these people because their traffic's too low for CRO. But it crosses the minds of most business owners, as they're starting up, "Hey, I'm getting traffic to my site. And it's converting at," I'm going to make it up "1%. If I just made that go from 1% to 2%, I would double my revenue and I didn't even have to work on increasing traffic, which may be is a struggle for me or I've got really big competitors." Ryan: All that is true, but sometimes that time and energy should probably be spent more on getting, maybe, more appropriate traffic or figuring out what traffic is coming and is not converting. But how do you have that conversation on the front end? Because I usually get it from you, at least, after you've already had some kind of conversation around, you just need more traffic. What insights would you give to people in that scenario? Jon: Well, I think, there's a couple of things you have to really consider before you're going to deep dive into optimization. The first is, have you found product-market fit, right? So is anybody, A, interested in your product and, B, are they going to buy it because it's solving a pain they actually have? It's one thing to get people to your site, but if the product isn't really hitting with the market, then you are going to waste your money. You can optimize and have the best funnel and the best site ever, but if it's really just not something people want or need, then you've wasted your money, right? So that's the first thing. Jon: Now, a great way to determine that and the way that I usually determine it, because it's really quick and it's something most people know if they're running or managing an e-com site, is number of unique monthly users to your site. Because here's the thing, if you've generated enough traffic, that means people are interested. And if you're able to drive traffic with ads, where you're spending at a sustainable level, that means people have a pain point and they're actually willing to click on an ad to solve that pain. That kind of proves it out, right? Ryan: Mm-hmm (affirmative). Jon: Now, what's that level? I generally want to see about 50,000 unique users per month before you're going to start doing true optimization. That's actually a pretty low number. It might feel like a mountain for some people, but if you've gotten to 50,000 per month... I mean, think about that, that's 12,500 per week, it's really not that many, right? Jon: The idea here is that you are able to drive enough people to your site, that you can start making scientifically-backed decisions. That's really where you're going to find those gains because you're no longer relying on what you think is best, or those 10 people you interviewed at Starbucks. Now, you're starting to get in mass enough data that you can prove stuff out to where it's statistically relevant. Ryan: That's a great insight, I think, on just a number, but also, I think, on market fit. I talked to so many startup businesses throughout the course of my day, weeks, months, but so many entrepreneurs come up with a really cool product that they just love, but unfortunately they have no idea who their market is or who they really think is going to buy. They have an idea like, "Oh, I really thought this company was going to buy it." But if you've created a product that hasn't existed before, nobody's searching for it. Or they're maybe searching for a problem, but getting a shopping ad to show appropriately, that image may not solve or cause them to take that click. So it becomes a much deeper conversation of, what are you going to do to get this into market? Not necessarily start by optimizing your site. It's, you've got to really find that fit, whether you go to social, whether you go to Google for that, whether you go to retail for that. Jon: Yep. That's exactly it. Conversion optimization is usually step two, right? So first step is... I would say step zero, is find product-market fit, right? Then step one is drive traffic. Then step two is, once you've proven those out, you want to start getting a higher ROAS or return on ad spend. At that point, that's when conversion optimization can help get you to that next level. And I say this all the time, Ryan, when... Jon: We have dozens of clients that share both Logical Position and The Good as partners and vendors. What we find, and I say this all the time, is when you have a company like LP that can really drive qualified traffic and you have a company like The Good that can help you convert that traffic at a high level, it is like adding fuel to a fire because it just accelerates things. And it really starts to show that you can start making a living off of your website, or take it to that next level that you never thought was possible. Jon: That's really where the gains can come in is, at that level, after you found product-market fit, you're driving some traffic, now you really want to take it to the next level. And then it becomes this great circle of, "Hey, you got your conversion rate up. Now, you have more money to spend on driving more traffic. And then you take that funds from the sales you're getting there, you reinvest it in additional optimization." You just keep going in that circle and it continues to compound that growth over time. Ryan: Mm-hmm (affirmative). It makes entrepreneurs, startups, even existing business owners nervous when you start talking about paying for traffic, but the value there, even if you're doing that to get to the point where you can use CRO, is you get the insight into the intent of that visitor. If you're just focusing on organic traffic, that's great by the way. We've already mentioned in this podcast before, there is no such thing as free traffic. You're going to pay for all of it in time, money, energy. But when you're using Google Analytics, you don't get the insight of what did they actually search when they came to my site, when they came through an organic link, or they came direct to my site. I don't know how they got... I don't know why they got my link, or they knew my website. Ryan: But if they're using paid search, you get all this really cool data of saying, "Hey, they searched specifically for this, clicked on my ad, went exactly to this page where I sent them, and they either took the action I wanted or didn't." So I can get a lot more of those insights. And you can even get... If you are paying for it, because obviously Google is a for-profit organization, if you do pay for clicks on Google Ads, you can use Google search console to connect Google Analytics and Google Ads, and you will actually get the search queries on your organic traffic, and see how that is operating and what that search intent is, and where you're ranking. That'll actually give you real average ranking for an organic query. Phenomenal data. But again, you have to pay for it by utilizing the Google Ads platform. Ryan: So some business owners out there that are listening, you do have to take the leap and actually pay for some traffic to get some of these insights that let you figure out where your market fit may be or may not be. And it becomes exciting, but also challenging. And so I will put an asterisk by that, that Google does have a great product for starting up and getting your business going. A lot of their smart campaigns, smart shopping can be very powerful to get a business up and running on Google shopping, unfortunately, you don't get that search query data. That becomes problematic when you're really trying to figure out your intent or what you're actually showing for on Google that is becoming so valuable and why your business is growing. So just be aware of that, that you may actually have to do some more manual work in there, but, man, there's a lot of opportunity. Jon: I didn't even know about that one. So now, I don't have to get the... What is that message that shows up in Google Analytics now? It always says something about like not found or... Ryan: Not provided. Jon: Thank you. Yeah. Ryan: That came about 10 years ago. It was great for Google because you're forcing people to pay for it, I get it. That data does exist though, you just have to pay. Jon: Yep. Well, that's good to know. Ryan, this has been a great conversation. Are there any other questions that I can answer for you on how to do CRO DIY? Ryan: No, I've just got to go get some things on my website so I can get to the level that I can pay you to take my CRO to the next level. Jon: Well, I know you and I know you've already found product-market fit on all of these, so drive that traffic, which you're expert at, and then I can come back and help you convert, and we can go from there. Ryan: Yeah. Thanks for enlightening me and helping me figure out some of these details of CRO that I didn't know, so that I'm not just doing CRI all the time. Jon: Go trademark that right away. Ryan: Thanks, Jon. Jon: Thanks, Ryan.

Ryan explores whether you should or shouldn’t use PPC automation tools to assist you in your paid search efforts. The answer isn’t so simple. For all your PPC needs check out: https://www.logicalposition.com/ What's covered today: What is PPC Automation? Should we use it? What are the benefits to Automation tools? What are the drawbacks to Automation tools? TRANSCRIPT Jon: All right, Ryan. Today we're going to talk about PPC automation, or pay-per-click automation. Now Ryan, I've been hearing a lot about pay-per-click automation tools. Now, this is mainly with brands who are doing one of two things. I see it when they're either trying to save a dollar by not working with an agency, and they think, "Hey, automation can help me do all of these things that my pay-per-click agency is doing for me." Or, they're just trying to scale their traffic up extremely quickly, and they see automation as the holy grail of them being able to do that. So, I'm really excited to learn about this, because I keep hearing about it, but I don't know much about it, and so I'm happy to have an expert to discuss this with. So let's just start by defining what PPC automation is exactly. Ryan: It's a big topic, and PPC automation can mean so many different things to different people. But high level, it generally means not touching certain pieces of an account, and having some type of computer system make decisions for you, within the Google or Microsoft Ads space, and it's even going into the social world as well. But basically, something gets done without a human touching it. Whatever that looks like, it's from high level computers. Jon: So, it's not an all or nothing. Because I was just looking at this as an all or nothing, like you're either using automation to run your PPC, or you're not. But you're telling me that just having some automation built in can actually be beneficial, as opposed to just going full automation. Ryan: Yeah. And there's different thoughts on that, just like everything online, even in CRO, I'm sure that it has to do with... Everybody's got an opinion, and it's different than everybody else's, on what works or what doesn't. It's based on their experiences or what they've seen, or what they've been told. And so, you've got extremes, where Google Smart Campaigns are an automation in Google Shopping, that will literally do everything. All you do is give it a budget, and what your return on ad spend wants to be, and it goes and does that. If it can be accomplished in the system, it will do it. If your return on ad spend goal was too high, for example, it's just going to sit there, and not really spend any money. If it's really low, it's going to spend a lot more money, and get you a lot more clients because the potential's there. Jon: So you're telling me automation can't solve all of my hopes and dreams. Ryan: I wish it could. There's some people that will promise you that, for sure, but if anybody is telling you that, they are lying, or they have an ulterior motive in place for you and your business. And on the other side, there are ways to use automation that help but don't necessarily do even the work in place of a human doing the work. And, as with most things, and my most common answer, which is also my least favorite answer in questions about digital marketing, is, it depends. Where should your business lie in that space around automation, specifically in the PPC realm? It's going to depend on where your business is at in the life cycle, what you're able to afford as far as agency or humans doing work, and what are the long-term goals of the business, or what are you trying to accomplish? Ryan: And so, let me take it in a few phases I guess, in kind of explaining what I believe in automation. You've got the full automation, where you're just going to either use a tool, or, for most businesses, use Google's Smart Campaigns in the e-commerce world to spend money for you in Google. I think in some spaces it does make sense, but it also comes with a very large asterisk, where you're having Google do all of this work for you to grow your business, but Google's goals, generally speaking, are different than yours. As a big, publicly traded company, they have responsibilities to their shareholders to grow their revenues and profits, just like you as a business owner have a responsibility to yourself or to your employees to grow revenues and profits. So for most businesses, Smart Campaigns and full automation in Google is not my recommendation, and it is mainly around understanding what's going on in your account and the ability to really scale. Ryan: But small advertisers, just starting up, you've never spent before, you really want to see if your business online has some legs to it if you start spending money, I do think Smart Campaigns within the Google space do have a place to play in that. And if I had to put a line in the sand, probably somewhere around $500 or less a month in ad spend to kind of prove a model. My wife, for example, would make me prove something to her before we actually jumped with both feet into a business and say, "Yeah, let's throw a bunch of money at it, and really see if it works." She'd say, "All right, let's kind of see what happens if you just kind of let Google do something on the side here to see what happens with 500 bucks over a couple months, 500 a month for a couple months." I think there's something there. Ryan: On the other spectrum, no automation, where you are 100% customized, doing everything either with an employee or an agency internally running an account on Google and Microsoft. That has a place to play, and I think that pool of companies where that makes sense is probably in more of a mid-tier type business model where you're spending a few thousand a month, maybe as high as 10,000 a month, where you're really just one person doing all the work for you, and you can do a lot of customization, because generally when you're at that spend level, you're not the biggest, you're not the smallest, but you're having to compete with some of those biggest, and you need some of that kind of surgical precision to find those specific keywords, or specific searches for specific products that really makes sense for your company, and you've seen the conversion rates that work. Ryan: And then, the vast majority of businesses fall kind of in the middle, where you do need some automation, and you do need some human strategy and somebody else, and some humans touching the account as well. And so, focusing on the middle is where it gets most complicated. So, for the majority of businesses out there, it's how much, or what parts of the account really make sense there. Is it an internal employee with some automation? Is it an agency using humans, and some automation? And what goes first? Is it the automation first, with a human checking on it, and making sure it's working? That's going to be a broad spectrum within the space. Jon: So, I'm hearing that it makes sense to prove out a business. So, prove out a new product perhaps, somewhere where you're just going to spend a little bit of money, and you want to start and see if there's a good product market fit there. And if so, then it would make sense to expand beyond just automation. But it does have its use cases, which is great to hear. So, okay. So, you've talked a lot about, there's three tiers to be thinking about, right? And that that kind of messy middle is where "it depends" is usually the answer, which makes sense. So, let's talk about some tools around this. What are the benefits to using pay-per-click automation tools? You mentioned one of them being to prove out a marketplace, but in terms of the tools themselves, can you talk a little bit about what the automation does in that sense? Ryan: Yeah, so there's a lot of different areas of PPC that you can actually automate. And a lot of PPC automation came about, let's say maybe 10 years ago it really started to get some traction, around bid management, and having some computer system actually automate the bid changes in the account, because it does get mundane. It does become difficult, in the middle of the night, for example, or around the clock, to be making changes in an account when you actually have humans working your account need some sleep. And so, bid management was really the beginning of the space. And so, that's constantly there. It's still there. Google even has automations built into their platform now around bids. They have enhanced CPC, which I believe, Jon, you had some fun with that setting when Google changed some settings around that. I believe you spent upwards of $200 per click on Google when we looked at your account together. Jon: Yes. That's where automation became dangerous. And again, I know nothing about this, right? And so, I thought, "Hey, I'll let Google handle it," and I clicked the box, and then ended up spending a lot of money. Ryan: Yep. Oops. And that, it happens. It's not, obviously, what happens all the time. But when automated systems get... be doing what they're told, I mean, they have to still have input from a human, they can do things that maybe aren't intended, and that is really the big thing you have to be aware of in using automation. They're really as good as the inputs you're giving them, or the person designing the algorithm. And so, heavy trading algorithms are really impacting stock markets all over. And so, big drops, big swings up and down can happen because of automation. So, you just need to be coming in with some concern or just awareness that that can happen, so you're watching it, no matter what level of automation you're using. Ryan: But there's bid management, there is automated campaign management. In fact, one of my competitors that's been around for even longer than us, and they actually have a really good name in the marketplace, they built some automated systems to take search queries that converted and build them into ad groups automatically, because that became some of the more mundane time-draining things that were happening, when you'd see a search for this specific product that you hadn't seen before, you're like, "Oh, that converted, that's great, let's make sure there's not more of that out there. Let's build a specific ad group for that search and capture all of it." Great strategies. And so, the main argument that a lot of agencies that are using automation and automated systems that are helping internal employees and agencies scale is you can spend more time strategizing on growth and let these automated systems do a lot of the stuff that are just sucking time away from maybe the things that are more mundane and you don't need to be spending high-powered talent on doing those things. Very logical. I mean, there's no scenario in which that sounds like a terrible idea. Ryan: What's happened with that, that I've seen over the last 10 years, is a lot of agencies have adopted this automation, and it's allowed for tremendous amounts of scale, without having to develop a bunch of humans to understand what's going on, or to know how to communicate with clients, which is in no way bad. But what's happening is as this scale is happening at a lot of agencies that I'm seeing their accounts is they're losing their touch with what's going on, and then how to strategize for actual growth because this tool is doing so much of the work, that they can't go in and say, this client may say, "I really want to start doing this," or, "I want to move my return on ad spend goal to this," or, "Should I be breaking into this market?" And because these tools are doing so much of the work, that question isn't as easily answered as if by somebody that was actually in the account all the time that saw the search queries, that was doing negative keyword reports, that was doing all these wonderful things, and bid management, that could actually respond very quickly and say, "Oh, here's what you need to be considering as a business owner or your marketing team when looking at this question." Ryan: And so, that's been one of my big concerns. I think about stupid, stupid movie, but Idiocracy, where you've got a guy that's been dead for so long, comes back and everybody's really dumb, and he was not smart back when he lived, but everybody got so much dumber because of automation and the world doing everything for them. I worry about that. I don't think it's happening across the board at agencies or internal teams, but I really have a lot of respect for groups of people, or agencies that have to be in the account regularly, and I see a lot better results, generally speaking, when somebody's in a Google Ads or Microsoft account making the changes, because they're seeing in real time what's happening in the market, and they have to have a lens where they're looking at things through and say, "Why is this happening? I have to go solve this problem or understand it a little bit more." Whereas, if a tool's doing all the work, they don't have to try to get in there and understand what's happening, or what is the competitor doing that's causing this to happen in this account. Jon: I heard you talk a lot about search and search ads and Google and, okay, so Google has some automation. Does Bing have automation? Microsoft Ads. Ryan: They do have some, and it's not as old as Google. So, I can't say that it works as good or has as many advancements because I also don't look under the hood and I don't understand all the engineers and what they're doing. Microsoft obviously has some very smart people and they're doing some great things in there. So, a lot of the same things you see in Google, Microsoft Ads also has a lot of that capability for automation, and I would use a lot of the same automation the same way depending on where you are in the business cycle and what is needed in your business. Jon: Okay. Now, what about social channels, because that falls under pay-per-click for me, right? Ryan: Yep. Jon: So, what about things like LinkedIn, Facebook, Instagram, Twitter? Is there automation built into those platforms? Ryan: There is some level of automation built into almost every platform, and I look at it almost the same no matter who or what platform it's on. It's an old example, but it still rings true. I wouldn't give all my taxes to the IRS to have them do them for me and tell me how much I owe them. We're diametrically opposed to what should be happening in that scenario. Jon: Right, success is different for each of you, right? Ryan: Exactly. Jon: Okay. Ryan: Exactly. So, if Facebook is doing everything for me and I'm just giving them a credit card and hoping that it does well, there is a piece of Facebook that wants me to succeed, but Facebook's success is more important to Facebook than my business succeeding. They know that if my business fails, another one's going to come up. Same with Google, same with Microsoft, same with LinkedIn. It's all the same. So, I, having been in this for a decade, I step a little bit away from automation whenever possible and I say, "Okay, how can I understand this better? How can I try to beat what the automation is doing?" Because what I've seen a lot of times with the engineers that build automated tools, way smarter than I am, as far as coding, math. I mean, it's not even close. But we're coming up with a strategy of maybe why this should be bid up or bid down, or maybe why this keyword should or should not be in the account. Ryan: I've still seen the humans making better decisions on that, and I think the machines and the AI is a very popular term. Artificial intelligence, everybody wants to be able to say that they do have a lot of that in their agency or in their organization, because it sounds really good. Like, "I've got this artificial intelligence that's really pushing growth and doing a lot of my thinking for me." Again, not bad at all, and I actually recommend businesses step into that space to understand it more and to use it where it's appropriate. But I still think when you have human searching and the change is constantly happening, we know that something like 15% of all searches done on Google every 90 days have never been done before. So, what is an artificial intelligence going to do with a search term that's never been done before? It can gain some insights possibly, but as we're blending in search query reports now voice search with text search, like, I type it into my computer or I search for it on Alexa or Google Home. There's a lot of different intent behind that. I've seen better results from humans looking through that and being able to filter it. Jon: Right, right. Especially working with natural language and understanding the intent behind what people are searching versus just what they say, right? Ryan: Yeah. Yep. Jon: Okay. Ryan: And so, yes, companies need to be looking at automation and considering the opportunities available, and then how is that going to compliment what they currently are doing? I don't ever look at, long-term, replacing humans... I mean, again, in the next five years that will be my long-term view. You can't predict anything in the digital space beyond five years, and really, anything longer than a year is, you're throwing darts at a dartboard way far away. But I don't foresee any time soon where I would be comfortable with my money on full automation, no human looking into that or doing it, or having a serious play within that space. I spend a decent amount of my own money on all these platforms, and I see the automation. I know the biggest players in the space. I mean, if you're in the PPC world, Marin, Kenshoo, Adobe, Acquisio. Probably hundreds of others that are doing the same thing in bid automation, in addition to Google and Microsoft, including Facebook will do some bid automation based on goals. There's no shortage of those. There's no shortage of very, very smart people working to create the next best automation. Jon: I think you made a good point earlier, and that's something I think you just touched on right now even, but it's in the favor when you do bid automation of Facebook or whoever to have that bid go up and up and up, right? So, automating means that escalation seems to happen more quickly. Is that not true? Ryan: Yeah, I mean, we saw it in your account, right? Where you were averaging in your business $20 a click, which is reasonable, based on how you spend money and the returns you get. But then all of a sudden, if everybody is on automation and everybody's using Google's automation on Google, how does Google know who's going to win? Does Google play, you know, make it socialist where everybody gets 5% because there's 20 people advertising, so we're going to even it out and make everybody little? How do you grow beyond that? And that's where logic comes into my side and says, okay, we can't all be on automation or there's just, there's no win. There's only so many ways you can look at moving bids up or down, for example. They can only move up and down, they can't move sideways, they can't move diagonal. And so, it's understanding more about the user as we add layers in from a remarking perspective, from an RLSA perspective. The more information we have about this user allows us to get more aggressive or less aggressive than maybe a competitor that doesn't have that information. Ryan: And so, all of these layers we add on add complexity and give opportunity to people that have that data. So data is actually probably, in my opinion, more valuable than some automations. The more data layers you can get, and you can get lost in data, so don't get me wrong, the idea that "Oh, big data, all you need to do is look in all these thousands of Excel sheets to figure out where that one specific customer is that you want and go find them and bid on them." It's more about using that as you're making adjustments and using the understanding and strategy behind why you may or may not be making this move. Ryan: It's fascinating, when I look at all the people I've hired in the digital marketing space and the people that have really succeeded on the backend of making the moves in an account. It's really, from a human perspective, becoming an art form in how you look at a Google Ads account, and you're kind of, I joke with the guys and girls on the team, or ladies on the team, that it's kind of like the Matrix, where you're looking at just all of these digits flying around. And the really good paid search account managers in the account really see it in a much different light than somebody like myself that would go in and say, "Yeah, okay, I see it says $200 and it says conversion." They're seeing all these different layers because of their experience. I mean, some of our people have been doing this for over a decade, 15 years actually, in the accounts, doing it, and they're so efficient and so crazy of what they can do. Ryan: And we've matched that up with people that are very good at gaming, like, the strategy piece of gaming. And so, really, we're looking at almost the gamification of digital marketing, where we're looking at these and saying, "All right, you're trying to beat these other advertisers." I'm a hyper competitive individual, as you know, and you're pretty darn competitive as well, in your basketball and marketing world. I want to win. And we find people that really want to win, and then they add their ability to see all of these moving pieces and saying, "Hey, if that competitor of our client goes out of business, that's unfortunate for that company, but it's really good for us and our client." Ryan: It becomes fun but also interesting in how you're taking that human that is really good at paid search management, and what we're trying to do is kind of make, right now my best analogy is kind of the Terminators. How are we using technology and bolting it on to them to make them more effective at what they do? Rather than replacing it, how do we give them things they can look through with weird glasses or things they can add onto their mice? What are we doing to make them more efficient as a human, and that's how we look at technology and automation. Jon: So next time I visit Logical Position, I'm going to be interacting with a bunch of cyborgs basically. Ryan: I mean, hey, if my vision comes in place. I mean, maybe two years out on that one. Jon: Dart board, right? That's one of the darts. Ryan: Yeah, one of the darts. But it's... I think the best use of PPC automation, personally, and this is my lens I look through and how we're looking at automation internally at Logical Position is, for the majority of companies in the middle, it's, how are you supplementing the humans? Instead of replacing them, how are you making them able to do more? So, we use, scripts are a great automation that a lot of people don't think about. We're using scripts to say, "All right, this ad group had a hundred impressions by 6:00 AM yesterday and it has zero today. What just happened? Something is broken there. Let's go in and see that." Replacing some of that minutia or things that just get really bored or tedious, or we just don't have the scale of a human in a large account to get to all of those pieces efficiently. How can we say, "All right, I need this to go do that"? Maybe it's not going to go through the search query reports for us and find all the negative, but it can bubble up some opportunities. Ryan: I've talked to a phenomenal technology company, Metricstory. If you haven't checked out Metricstory I think they're really cool, and they're really, man, they have some smart engineers. They're doing some automation where they're able to bubble up new opportunities based on scraping a Shopping search query report and saying, "Hey, these converted and they're actually not showing in your text ad or search portion of your account, from a search query perspective. You should put this keyword in there because it's converting on Shopping." And it can, based on their algorithm, their really smart algorithm, it can even give you an estimated return on ad spend, saying, "Hey, this keyword we think is going to get this based on ad groups around it." Ryan: So we're really looking at leveraging some of that in our efficiencies. Say, "Okay, if we have that, can we make this person able to focus more on bids on text ads because we have this filtering a search query report on Shopping?" Or we're able to find losers in the search query report on the text ad side much quicker than we could if we had to comb through it by hand. Jon: Yeah, this is a really interesting point, adding on to what people, the strategy that a human person can bring to this, with a little bit of AI, helps them to push this even further. But you still have to have the insight that somebody is bringing to the table with that experience to really pull out the meaningful changes. And I thought it was really interesting, you said earlier that aligns with this, bids and these automated bid machines, they only can go up and down. They can't go sideways or diagonal or any other dimension, right? And that's what a human is able to do. Ryan: It's a frustrating answer, but every company should be looking at kind of a backstop. And then also, if you're a company that has one person managing your account internally, I always had the worry as an agency of the bus theory, like what if they get hit by a bus? I told my team, nobody could take the public transportation because you can not be hit by a bus. We don't have enough backups. But in that scenario it's like, okay, well, who else is going to be aware of that? And it can't just be an automated system that's going to be continued going if they evaporated tomorrow, because it's unencumbered, you know, what's going on. Ryan: So, having some automation helping them, but also documenting things too so that an automation doesn't need to take all of it, but that another human could come in and replace or augment as well if somebody needs time off or pregnancy or birth or sickness, all these other things that we, at scale, with 750 employees here, we can do that automatically but a lot of companies don't have that ability. And so, they need probably a little more automation just to protect themselves but also ensure that there are some humans looking at things. Jon: Well Ryan, this has been extremely educational for me. Thank you for sharing all the knowledge around this. I am really looking forward to the day that I walk into Logical Position and I'm interacting with some cyborgs and then having you bring that skillset over to The Good so that we can continue to do the same on the conversion side. Ryan: Oh yeah. That looks fun, huh? Jon: Yes. Awesome. Well, thank you so much for educating me today. Really looking forward to not spending $200 unnecessarily on my own ads by checking a box for automation in the future. So, thank you for saving me on that earlier on. Any last words on this? Ryan: Of course, you can just send me a $200 bottle of wine and it'll be just the same. Jon: Perfect, I know what you like. It's in the mail. Ryan: No, I think it's good just to always be careful with automation. Don't assume it's going to work for you always. Just have smart humans working with you. Jon: Awesome. All right, thanks Ryan. Have a wonderful afternoon. Ryan: Thanks Jon.

Jon dives into why Conversion Rate Optimization doesn’t stop after the purchase and the different points after-purchase that you need to optimize in order to drive higher revenues. Link: The Essential Guide to Ecommerce Sales Promotions (https://thegood.com/insights/essential-ecommerce-promotion-guide/) (In this article, #51-78 are focused on promotions you can run that aren't discounts) Outline: First, Jon cover’s different points after purchase that CRO can have an impact: In cart, right after purchase -Thank you page Email post-purchase sequence: -Confirmation email -Shipping confirmation -Customer service -Please leave a review – just click here -Add to general marketing email list sends He also explains the metrics a brand should be looking at to track progress of post-purchase optimization: -Return purchase -CLTV -Conversion (overall, should go up with repeat customers!) Jon is a firm believer that companies shouldn’t use discounting in post-purchase communications. However, there may be offers you can make that are not discounts. You do not want to become a discount brand. Finally, Jon explains that a successful method for getting referrals post-purchase outside of a set loyalty program is just to ask! Very few do! Transcript: Ryan: Jon, today, I really want to move our focus to an area that I think many companies and individuals would not normally think of conversion rate optimization and the impact it can have. I'm talking about post-purchase. Most people generally would assume that once a purchase happens on the website, CRO has done its job, time to move to the next person on the site and get them to convert. But, because I know you, I'm aware that CRO doesn't stop at the purchase. There's a lot more to be done. Can you explain to people, that maybe aren't aware of post-purchase conversion rate optimization, what they need to be thinking about, what they need to be doing, and why it even exists after they've already taken the sale, done what you wanted them to do originally? Jon: Right, and I think that's an important point there, Ryan, which is that most people think that conversion optimization stops as soon as you get someone to purchase. I think that's really shortsighted and it's a big problem because so much of the consumer experience and getting people to purchase a second time, is all about what happens when they purchase that first time. So, if you get them to convert, your job's not done. At that point... you got to think of this like a marathon. You just ran a marathon. Most people who are seasoned marathon runners, they get through that finish line. They have a process they still go through to cool down, protect their body, recover a little bit. It's the same thing here. After you've- Ryan: ... And I just go drink beer. Jon: ... Right, exactly, and that's why you don't run marathons. Ryan: That's why I don't. Jon: Learned that lesson the hard way, huh? Ryan: Uh-huh (affirmative), I did. Jon: Yeah, so exactly, this is it, where we can't just stop and drink a beer. You've got to go through a follow-up process here that can really, really have a massive impact on your overall metrics of your site and success and revenue, and even your conversion rate, because most people don't think about that. But overall, your conversion rate should go up with repeat customers. Ryan: True. Jon: There's a handful of things you should be thinking about that I think we should talk about today. There's a bunch of different points after purchase that can have an impact with conversion rate optimization, and if you optimize these points, you will see higher revenues. Ryan: Okay, so somebody's purchased on my site or client's site. Action's done. Does post-purchase conversion rate start after the product arrives, or where's the first point that we can be making an impact to improve conversion rates in the future? Jon: In the cart. It starts right then. As soon as somebody completes the order, gives you their payment, what happens? Ryan: Hmm. Jon: Most of the time, people aren't really considering the first step, which is a thank you page. What is the content that you're putting on there? Now, there are ways to, even on that thank you page, influence so many extra metrics. You can influence your average order value on that thank you page. There's some great tools out there right now. One of my favorites is a company called CartHook. CartHook has a tool, where you put it onto your thank you page, and it actually shows you complimentary products to what you bought and says, "Do you want to add it to the order?" You're doing an upsell after the purchase. You already got them to commit, and maybe they're thinking, "I bought those shoes, maybe I'll add a pair of socks. Why not?" Ryan: Now is that in addition to maybe also having upsell in the shopping cart, or do you usually recommend just get them to commit to something and then try to upsell them later? Jon: Right. I think that's a big mistake people make is to do the upsells in the cart. I don't think that's serving the consumers' needs, because serving the consumers' needs is helping them complete that checkout as quickly and easily as possible. You want to get that conversion. That's most important, obviously. So, after you've completed that sale, then, go back and do the upsells. Now, that doesn't mean you're not doing upsells throughout the funnel and throughout the product detail page or categories, things of that sort, right, complimentary products. But I don't think you should be doing it in the cart. That's when you just closed the transaction, at that point. Jon: A lot of people like to think of it like retail, where you're at a grocery store and they have all the candy bars and magazines, and you're just standing there in line. It's not like that because online, you shouldn't be waiting around at the checkout. Those items are there at the grocery store line because you're waiting for the person in front of you. You're likely bored, and they're capturing your attention. It's a captive market. Well, when you're in the cart and you're checking out online, you just have one goal, and that's to get it done. So, anything you put in the way there is actually going to become a distraction and annoying for the consumer. Not something where, "You're entertaining me with the latest gossip about celebrities for five minutes while I'm waiting for the family in front of me that's scanning 300 items at the grocery store." Ryan: Oh, you follow me at the grocery store, huh Jon?" Jon: Exactly. I got one kid. I can't imagine having a whole family like yourself. I think the first step is definitely in-cart, on that thank you page. Pay attention to the messaging. You can run a lot of A/B tests on the messaging alone and see what resonates. But also, adding a tool like CartHook, where you're figuring out all of these additional metrics and how to increase things like customer lifetime value, average order value. All of that kind of even goes back into your ROAS, your return on ad spend. If you start thinking about it this way, the higher your average order value, the higher your return on ad spend. Ryan: Mm-hmm (affirmative). Now, in addition to something like a CartHook offering up some complimentary products, is there any kind of messaging or kind of like, "Hey, I really want to make them feel good about what they just did. They spent money with me..." because most companies are like, "Hey, thanks. We'll be emailing you a confirmation," and that's pretty much the thank you page. Do you recommend adding more to that, or is it just kind of just get the products in front of them, get them in and out type thing? Jon: Well, we've actually run some tests, where brands who already participate in like 1% For Good or some of these other donation or charity causes, at that point, and reemphasizing that on the thank you page. Like, "Thank you for your purchase. Did you know part of your purchase is going to these great causes?" Ryan: Oh. Jon: Right? Ryan: Mm-hmm (affirmative). Jon: So, what's happening there is you're actually just making somebody feel even better. You're reassuring them about their purchase. I think that's really important there, is the reassurance. I don't know about you, but sometime... like, I bought a new car six months ago now, maybe. There's nothing like the joy of driving the new car home. But then you're sitting at home and you're like, "I'm a little guilty. I feel guilty. I bought a new car today." You know what I mean? Ryan: Mm-hmm (affirmative). Jon: It's that thing where it's like, "I just dropped a lot of money on this." Yeah, it's awesome, but at the same time, I could have got a used car that had a hundred thousand miles on it and would have got me from A to B. It's the same thing when you buy online. You need to reassure people that... they probably didn't need what they bought from you. Maybe they had some need around it. But if you did a great job with your marketing sales and every everything else but your customer experience, you helped them see the benefit of a product that maybe had a little more cost to it than what they were planning to spend, but there's some value there for them. Sometimes that's just the emotional value. But, at the same time, reassurance is really key on that thank you page. Ryan: Got it. Okay, so we've got the thank you page dialed, we've got some upsells potential there, we've told them that they're amazing and they bought from an awesome company. Now, how do I go about encouraging future business from this customer of mine? Jon: Well, I think the first thing that really needs to be paid attention here is that what happens in email post-purchase. Now, most people don't think about this when they're optimizing a site. They usually just leave it to whatever the defaults are. So, if they're using Shopify, it will automatically send out some emails, depending on what email provider, using like a Klaviyo or something like that. It will have some of these built-ins with some best practices. But this is a ripe opportunity for optimization that most people are not thinking about. Jon: I always say there's five emails that should be sent out after a purchase. It's a huge opportunity if you're missing any of these five. Now, the easiest one, and the first, is always confirmation email. The order went through, all is well, it's received, we'll be shipping it on this date or soon. Just confirming everything's gone well, it's gone through. Just send them an email, and that email should go out immediately. There's no reason to hold on to it, even if you don't have a shipping date yet. It doesn't need to have tracking information in this email. It's just, "Hey, you know what, we have your money, your order, here's your receipt," right? Ryan: Okay. Jon: That's a good opportunity, at that point... I've seen this done very well, and I don't know what the tool is, but I should definitely look into that. I've seen this done so well, where they even do the upsell in that email. This happened to me last week. I bought some lights for my yard, solar lights, and to light up what's been real... we live in Portland. It's super dark here this time of year for long hours of the day. So, I'm driving home and it's dark in my driveway. Well, what I did, I went and I got some solar lights. Yeah, probably not the best for how dark it is here, but we'll move on from that. Jon: In the cart, it said, "Hey, you bought a certain number of these, did you want to add more?" That was a great in-cart experience and I decided not to do it. But then, I got the email right away. In that email, it said, "Hey, if you change your mind, you have four hours from when this email is sent to add a few more before we're going to start packing up your order, and you'll have to just place another order." And it said, "Click here to add four more, eight more or twelve more." It even had a discount on them. I thought that was really interesting. I wanted to see it, what would happen, just from a research standpoint, so I added four more to my order. It was great. It just took me right back to a page on the site that said, "Thanks, Jon. Here's your order number. We added four more to it. Your new total is X." Ryan: And you got a discount on it, on adding the four more. Jon: Well, it was because they didn't add any more for shipping those extra four, right? Ryan: Mm-hmm (affirmative). Jon: So, it wasn't a percentage off. It was saying, "Hey, we'll add these, but we won't charge you more to ship them." Ryan: Got it. Jon: Now, you could do a whole bunch of different items around discounting. We should definitely talk about discounting today, a little bit there. But I think the point here was, is that they had a captive audience. I'm going to look at my receipt email. Most people do. Ryan: Yep. Jon: It should be a highly opened email. So, it's a great captive audience and a great opportunity to do an upsell that nobody really thinks about. Ryan: No, yeah, and I can easily see how... you didn't take the complimentary products, but maybe you suggest something maybe even more different in the email, but offer a discount. Like, "Hey, add this in and we'll give you 10% off, and just include it in the order and it'll go out at the same time," or something. Jon: Right. And you think about it, it's a free cost of sale at that point for the retailers. So, there's really no additional cost in sending that email. You're already going to send the receipt. Email is super cheap as is anyways. But you don't have to advertise to them. You're not remarketing. You're not doing any of that that could add the extra cost. Jon: Okay. So, we have confirmation email. The second email is shipping confirmation. Once the order has shipped, let the consumer know immediately. "Your order has shipped. It's on its way. Here's the tracking number, and it should be there within this date range or on this specific day." Now, even if the tracking number is not available in UPS or FedEx or whatever at this point, because those can take 12 hours or 24 hours to show up in there, you can always just say, "Hey, this link won't show any results for X amount of time." But you should give them that right away because they're going to reference that, perhaps, throughout the order process or while they're waiting for the order. But I think it's a great opportunity just to confirm things have been shipped, all is still well, it's going to be there. Jon: It's a great opportunity, at that point, to also offer any resources. So, you can say, "Hey, you bought these solar lights. Let me include a video..." and this is exactly what they did for me. They included a video that showed me how to put them together, in that shipping confirmation. Ryan: Hmm. Jon: So now, I had something to kind of tease me a little bit until the products arrived. I thought it was super interesting because, not only was I just getting that shipping information, which normally I would just look at, but archive and save in case it didn't arrive, but I actually went through and reengaged with the brand by watching an installation video, which is a great opportunity. Now, when I get the product, immediately I can open the box and start using it. Right? Ryan: Oh, yeah. Jon: That's a much better experience. So, we've got confirmation email, shipping confirmation email, and the third email I always recommend is a customer service email. What do I mean by that? Well, this is just a check-in email. This should be a couple of days after the product was supposed to arrive. What should happen here is it should say something like, "Did you receive the product? Was everything okay? If not, just reply to this email and let us know." Pretty simple, right? Ryan: Mm-hmm (affirmative). Jon: It's a just let them know you're there, that they have a channel if there's an issue. And what you're going to do here, is you're going to prevent a negative online review. Because if they have a problem, they're not going to go online and vent. They're going to say, "Oh, you know what, I got that email from them. I'll reply to that email and try to figure this out." And then, you have an opportunity to turn a bad situation into a good one very quickly. You're preemptively handling that situation by just letting them know you're there. And if there's no problems at all, it's still awesome just to know that that brand is available for you and that they're there. Jon: I often recommend, have this email either go out the day the product should arrive, and you can say something like, "Your product should be arriving today. Let us know if you have any problems," and things of that sort. It's also another opportunity to send some more resources. If you want to link to more stuff up on your site, or there's... we worked with a company that sells tents. They did a really good job with this. It's like how to set up your tent, right? Ryan: Mm-hmm (affirmative). Jon: Because a lot of people struggle with that. They've gotten a lot easier over the years, but it's still something that required a little bit of knowledge. So, we've got confirmation emails, shipping confirmation, customer service, and then the fourth email I always recommend is please leave a review. This is a review request. Now, this should definitely go out a couple of days, maybe even a week, after they've gotten the product. The idea here is just make it so simple for them. There's a couple of tools that make this super easy. Shopper Approved. It does this extremely well. It's a reviews platform, where they just send out an email that asks for the review, and then it has five stars in the review, and it says, "Click the star that you want to rate." Ryan: Yeah, I've actually done that before and didn't even know I was giving a review. Jon: Right. It's one click. Ryan: It's phenomenally simple. Me, as an online marketer, I'm in it all day every day. Then I got a review email from one of the companies I bought from, and it was Shopper Approved. Blew me away. Like, "Wow. I actually just accidentally gave a five star review." I was going to give it anyway, but it was like, "Wow, that was ridiculously simple." Jon: Yeah, and that's exactly what it's about here, is just make it quick, make it easy, but ask for the review. Most people, at this point, don't ask for a review. They're asking for a review on their website, which I can promise you, nobody is going back to a website, from finding that product detail page for the product they purchased, and giving it a review. It's a huge red flag and perhaps we should do another episode, Ryan, on product reviews, because it's a huge red flag for consumer trust. Jon: If you see, on a product detail page, that you can leave a review, that tells me that there are so many unverified reviews on there. I don't trust what's being said anymore because the manufacturer or retailer could just be sending their entire family to that page. I want to know that they're actually verified reviews from people that have purchased and that's the only reviews that are in that mix. The best way to do that is just ask for it via email after the purchase. It's going to be a verified review. That also, and you probably know more about this though, Ryan, but that also allows you, if they're all verified, to have the star ratings show up on your product detail page listings in Google search results. Ryan: Yeah, exactly. You need to have a review aggregator that's approved by Google that's looked at their system and said, "Yes, you're actually getting legitimate reviews." I know there's some plugins on a lot of eCom platforms that allow people to just leave reviews on the site, like you said, and it doesn't build trust. Those can't be sent to Google. So, if your website is, "Hey, I got a place to get reviews. I've got 500 wonderful reviews on my website. How come Google is not allowing me to send them?" It's because you haven't used one of the 30, I believe, companies that are approved to send those reviews to ours, and Google trusts that they're legitimate. Jon: Now, you're not gaming the system, so that's helpful. Ryan: Mm-hmm (affirmative). Jon: So, five emails. Confirmation email after purchase, shipping confirmation, customer service, leave a review, and then the fifth is just add them to your general email marketing sends. So, whatever that next email marketing send is, just add them. Now, here's the thing. If you're going to send an email every day, or even every week, the cadence can't be the same as somebody who clearly signed up for your marketing emails on your site. Now, I'm suggesting sending them marketing emails, but maybe it's once a month. It's just some way to stay in front of them, and these emails should be more helpful. They shouldn't be, "Here's the big promotion we're running right now." It should be something like, "Hey, Valentine's Day is coming up. Have you thought about ordering by X date to ensure that you'll have it in time?" Ryan: And so on this, real quick though, you would, in theory, keep them out of your marketing emails until they get to this point. You don't want to automatically, you purchased, you're in my marketing email, and you're going to get a marketing email in the middle of this cadence of emails. Like, you don't want, "Oh, shipping confirmation." "Oh..." two hours later you got the marketing email. Jon: That's exactly right. I think that's extremely important that even if they signed up... okay, this isn't a tactic I recommend. You know I rail on this all the time. But even if you had a pop-up, and you offered a discount to sign up for the marketing emails on your site before they made a purchase, you need to hold those emails a reasonable amount of time, maybe a day or two, to see if they made a purchase right away. There's so many of these tools, like Klaviyo, that make that pretty easy to do, where you can just add an exception real quick to hold them until the next email blast or something. But I would wait for them to at least complete that purchase. If they complete the purchase, then don't send a marketing email until they've gotten the other four emails. Ryan: All right, so we've got an email cadence. We've got in-cart right after the purchase. Some of the things you can do on the thank you page. We touched on this a little bit, in the process of going through there, but in addition to CartHook and maybe the email platform you're using, are there any other CRO tools people can be utilizing or looking at when they're trying to improve post-purchase conversion rates? Jon: Well, I think that it's not as data-focused on tracking every click and movement at that point. So, it's less about the toolsets here. It's more about that customer experience. Email is going to be your biggest toolset here. Yes, there's a lot of stuff you can do to run tests and see how much people are engaging with that thank you page, and there's tools like CartHook and several competitors to them, but I don't think that being as data heavy at this part of the process is going to be very beneficial. Ryan: Got it. And a lot of that is going to be measured by lifetime value of your customers. Are they increasing or not? So, if your lifetime value was $500 and then you implemented a bunch of these things Jon's talked about, did it move to $700 or $800 over a course of the time period that you're outlining? Jon: Right. And there's really three kind of goals that you should have from doing this, and three metrics that you should be tracking by optimizing post-purchase. The first is that customer lifetime value, of course. We want to see that go up over time. What influences that? A return purchase. Did you give them such a good customer experience that they came back and purchased again? Another thing is number of reviews. That's a great one because people are only going to leave a review if they're satisfied or if they're deeply unsatisfied, right? Ryan: Mm-hmm (affirmative). Jon: That kind of mushy middle there, nobody really leaves a review, typically. That's why you very rarely will see like a three star review. You're going to see a five or a one, or a four, sometimes people don't like to give five unless... they reserve that for the one time a year. Maybe it's between four and one, but you see very few in between, typically. Then the third metric, besides those, that you should be thinking about is just your conversion. Your conversion rate overall should go up because of those repeat customers, in the sense that if you get more people to come back and purchase again, you should see your conversion rates go up because it's going to be an easier purchase, you're going to have more sales. So, it kind of feeds itself in this cycle. Ryan: Got it. So it's post-purchase conversion rates not something I've normally thought about, or even associate with typical CRO and what you're doing with customer testing and heat mapping and all these wonderful things you do onsite. Now, is generally post-purchase CRO a part of an overall CRO strategy or do you kind of separate them into like, get the purchase CRO and then post-purchase CRO? Jon: That's a great question. Now, my initial thought on that is that it is something that is built into what we do at The Good, and it should be part of a full conversion optimization. But it is a graduate level step. What I mean by that is if you haven't gotten into college and completed those courses of just getting the conversion, then there's no reason to focus on post-purchase yet. So, you really want to have a good customer experience up to that point, and then you can start working on post-purchase optimization. But it is an overall part of the CRO picture, and it really should be. Ryan: Now, one easy way to increase your conversion rate is to throw a bunch of discounts out, obviously. If people save money, of course they're going to buy more, generally. But how do you, or do you, recommend any discounting post-purchase? I kind of mentioned like, "Oh maybe I would throw a 10% discount out for complimentary products in an email." But that may be a bad idea. I don't know. Jon: Well, I'm not a proponent of doing discounts on a site at all. I really believe discounting is not optimization. I call it margin drain, because that's really what it is. Now, can you get more sales through discounting? People love a discount. It does work, but I'm not a proponent of it. I don't think you should be testing discounts, testing promotions in that way. There's a lot of other ways to be doing promotions that aren't just a straight up discount. And the reason is, and I say this all the time, once you bring a new-to-file customer in through a discount, your brand is forever a discount brand in the eyes of that consumer. And it's just not going to change. That means, every time you do a purchase in the future, you're going to have to offer a discount. It's just what's going to be expected. They're never going to want to pay retail price because that's not what the expectation is. Jon: But there are ways around this that are still intriguing offers that aren't discounts. We actually have an article up on our site. We'll have our producer put it in the show notes. But there's an article that we have up on The Good that's something like 90 or 100 different types of offers that you can do that aren't discounts. Ryan: Oh wow. Jon: There's just an unlimited number up there, it seems like. Now, things like buy one, get one, bundling. I mentioned, just earlier, how the company got me by saying, "Hey, we'll add four more to your order without charging you more for shipping." So, you can do things like shipping promotions. Free shipping should be something that you're considering. If not, look at a better fulfillment partner, perhaps, but there's a lot of options out there. That you're allowing people to upgrade their shipping speed. Ryan: Yeah so, one final point, I think, in the post-purchase thing. Something you and I do a lot of between our organizations is referrals. I'm always referring business over to Jon and Jon's very good at referring business to us. But in the eCommerce space, very rarely do I get asked to refer somebody else. I just bought this product. I'm really excited about it. I mean, more than likely, I'm going to be willing to refer, but very rarely do I get asked about it. And a lot of times it's... there may be a loyalty program system out there that does some of this, but what do you suggest companies do to increase some of that potential for referral? Jon: Just ask. I think, as you mentioned, so few do, and there's... most eCommerce managers are spending all this effort and money in affiliate programs, where they're getting people to recommend their product in exchange for an affiliate fee. But they ignore the power that people who actually buy can have. And I think that's a mistake. They really should be thinking a lot about how can we just get somebody who purchased, and is happy with that purchase, to be a referral source? One of the things you can do is, in that email chain that I mentioned of those five emails, instead of asking for a review, you could ask for a referral at that point, right? Ryan: Yeah. Jon: You could mix it up and do a 25% you're asking for referrals, 75% you're asking for a review, however that mix is that you'd like. There's a lot of options there. But the reality is, is all you have to do is ask, and it should cost you nothing at that point. You could offer them a gift in exchange for making a referral, something of that sort, or have a loyalty program that you're doing. There's some great tools out there. I'm a huge fan of one called Smile, smile.io. Smile.io, however you want to pronounce it. But there's a handful of these out there that do a really good job with the loyalty programs. And one of those is asking for referrals and doing it at the right step in the process. Just so few people do it that it blows my mind. Ryan: Is there a right or a wrong way to ask for that referral? Is there a way that it can make people mad, or there's a way that you've seen that's been very successful in that email chain of asking for one? Jon: The first thing I would do is offer them something of value to share. So, instead of the overt, "Just click here to publish to your Facebook a, "I just bought this product, you should too," or something that is super cheesy and very pushy. That's the mistake I see, typically. And most people aren't going to do that. But if you make it something that is really useful, like, "Hey, I just bought this tent from this company, and here's a video on how to set up a tent, or a trick on how to set up a tent, perhaps, that would make your life easier if you camp too." So you say, "Okay, well, share that out," perhaps with this referral code, something of that sort. And you can offer people a discount. Jon: Now, a lot of times... I do this a lot. If I really like something and I'm recommending it to somebody, I'll say, "You know what, I know I get a discount on that. Why don't I just make the introduction and then I know you'll get a discount." So it's, "Offer 10% off to your friends," or whatever that might be. Or, "Use this code and your friends get free shipping," or, "They get a free gift if you refer them." It doesn't, again, have to be a percentage off. But I think there's a lot of options there and a lot of offers that could be mixed in. It just requires a little bit of thought and creativity instead of doing the lazy thing that every eCom site's doing, and either not asking or just saying, "Hey, use this code and give it to your friends for a percentage off." Ryan: Got it. So, just kind of make it a little more fun or exciting, or not just the basic "give me a code." Jon: Right, exactly. Ryan: Well, that's awesome. Okay. So, we've got a lot of potential for increasing conversion rates from thank you pages to emails to referrals to countless different things. Thank you, Jon, for downloading all of that education on us. I think there's just a ton in there that I'm actually going to start implementing on some of my brands. Anything else you want to leave us with? Jon: No, I think that the first thing to think about is getting that conversion. After that, there's so much more opportunity to go that most people don't pay attention to. I think it's really important that they take that extra step. I appreciate you bringing this topic to the table and us discussing it today. Hopefully it's a value for folks. Ryan: Oh yeah, I'm sure it is. Thank you, Jon.

Engineering Influence welcomes Kevin Flaker, Becca Schmidt, & Ryan Karlin, the hosts of the “Close of Business” podcast. Kevin, Becca and Ryan are all young professional engineers at Black & Veatch who started the podcast as a place for young professionals in STEM to discuss all issues related to tech, innovation, work/life balance and any and all issues related to the science and engineering industries.  Subscribe to their podcast on Spotify, the Apple podcast here and wherever podcasts are heard.  Check them out!Transcript:Host: Welcome to another episode of the engineering influence podcast. ACC is regular series of podcasts. We're here today with the three presenters of the close of business podcast, which they build is the one and only podcast for young STEM professionals. All three are engineers at black and Veatch. So why don't we start off by the, each of you introducing yourself and telling us a little about yourself.Kevin: All right. I don't know. I'll go ahead and my name is Kevin flaker and first thank you for having us on and letting us join your podcast. We've all three are engineers at Black & Veatch. I am an electrical engineer. I work in the solar design business. I design solar fields for a living and podcasting is, I guess as you would say, a side hustle for me.Becca: My name's Becca Schmidt. I'm also, I'm an engineer mechanical engineer who's been focused on designing a natural gas fired power plants and just transitioned over to to doing business development and sales, more client facing work.Ryan: And then I'm the third cohost. A name is Ryan Carlin. Instead of those two, I am a civil engineer, so he got all of covered. I have been focused in the power delivery group transmission line and substation work. So kind of diverse engineers within the power business. But all have love for podcasts. Yeah.Host: Yeah. I've really enjoyed it. I've listened to a few of them and they're really well done. It sounds like you guys have a lot of fun doing it. It, you, when you first started, you were saying that, you know, this is, this is from people who have never looked up on Google how to do a podcast. How did, how did you guys decide to do a podcast?Kevin: Yeah, so a couple of years ago, a few of us were pulled into somewhat of a roundtable here at Black & Veatch. And the purpose of the discussion was to look for ways for Black & Veatch to engage more in the community. We're a severely industrial or in the past we're heavy in the industrial power water, telecom businesses and not necessarily more on the commercial side. So we were just kind of throwing around ideas for ways for us to connect into the community. And I happened to just start getting into podcasts and listen to podcasts and love how much you can learn. So I threw this idea out there that, you know, we could create this podcast. It would be a way for us to engage with community on the different projects we're doing. The work we're doing at Black & Veatch. But then also selfishly it was going to be, if it went through a cool way for me to being a recent graduate, look up all these different cool industry technologies that were emerging as well as all the different things Black & Veatch was doing.Kevin: And being able to like research that for myself as well as share that on the podcast format with the community. And what that's transformed into today is not so much of a, here's what we do at Black & Veatch, but more of a, here's a generic STEM podcast where we talk about technology across, we try to reach all industries, not just power or water, telecom. Oh, you know, we talk about autonomous vehicles and the Hyperloop, just any really cool thing going on in the STEM industry and just bring that to the community. And I guess utilize Black & Veatch's knowledge when when applicable.Becca: And in addition to that, we talked a lot about engaging with the millennial workforce, the millennial group. We felt like there's this external perception of what engineers and people working in the STEM industry are really like. And the three of us kind of like to categorize ourselves as something that's kind of against the grain, not the typical stereotypical, nerdy, nerdy engineer, you know, and we wanted to present, you know, what it can be like to be an engineer, that it's this really cool and exciting thing and it doesn't have to be over complicated or super nerdy.Becca: It can be talking about just cool things going on in the STEM industry, literally over beers and communicating it in a really digestible, relatable way too.Ryan:  And that's kind of just to give a hindsight how we got the name close of business. So it was all meant around, you know, having to close the business, you know, when everyone goes home or goes to a happy hour, kind of just talking recent news or STEM-related stuff in a fun and kind of informal manner. So we try to kind of play on that and have an informative yet fun kind of atmosphere.Becca: Kind of a long winded response. But we put it all on the table.Host: It really comes across and I especially in your early ones when when you were sort of finding your feet what do, I mean all three of you are, are really quite young. I mean, I, if I'm right, I mean you're all graduated since like 2015 or 2014 is is what does that bring, do you think to your, your program? I mean, you know, the, the picture of the old stodgy engineer with the time and you guys are not that obviously, but it, what impact does your age do you think have on this?Ryan: I think I mean one is just a different perspective, you know, we don't know what we don't know type of thing, so we're not afraid to ask questions. Kind of along the same lines of our audience. We're learning just as much when we're preparing for these episodes as our listeners. So I mean, I think, I think that's one big thing that I see.Kevin: Yeah. I guess one of the focuses or one of the, one of the purposes for this podcast would be to kind of grow and influence STEM in younger generations, whether that be college students who are studying in the field and are, or maybe flirting with the idea of getting into STEM industry, but don't really know, like, you know, that's a huge entry point when you start talking science and tech. It's kind of scary, daunting at first or even high schoolers who are interested. So I think like we're able to bridge the gap to where we can communicate with the experts in the industry. We have the connections, but at the same time, we're still learning ourselves. So we're able to, as Ryan mentioned, ask the questions that the everyday listener would be asking. You know, we're not experts. We hardly know what we're talking about. And I think that's kind of our trick.Becca: Yeah, for sure. And I think a lot of the perception that of that I've had with the people that I work with here is that, you know, they're experts now, but what were they like when they were developing as young adults, young people in their career. And I think we're all kind of like finding ourselves when we're learning throughout our, our careers and also learning what it's like to be a young adult in early on in your career, in developing through all of that. It's something that people don't really talk about as much. And in reality, when we all started working full time, we didn't know we were doing, Oh, that's totally fine to community, still trying to communicate that, you know. And that's something that we are really passionate about engaging with our listeners on as well.Host: Yeah, no, you can hear the passion obviously, and the enthusiasm. I mean, what have you, have you learned about your listeners at all? Do you know who they are? You know, are they, are they the young people who are thinking about getting into STEM or are they other engineers?Ryan: I'd say it's kind of a wide range. So we've gone to college career fairs and some people have listened to the podcasts, you know, they love it and they say they get good stuff out of it. But then also, you know, we do episodes kind of internally and they're released and we have executives come up to us whether within black and Veatch or external companies, and they kind of share their interests and kind of excitement about the podcast. So, I mean, I think just, we're geared towards young professionals, but I don't think that really leaves us out of, you know, Quinn Robinson, who's on your guys's board. He's a big fan as well. And I want to call him a young professional. So it kind of all ages, I guess, in that sense. Yeah.Host: Yeah. How do you guys how do you come up with your, to your topics, the, I mean you've done 33 so far, that's a lot of things to think of and, and, and bring and research and bring to the air.Becca: Yeah. It's a combination of tapping into all of the different things that are all the different innovative things that are happening within Black & Veatch. A lot of the people that we've interviewed so far professionals that are doing really awesome, big innovative things within the company and we're excited about it and we want to communicate that with the, within the world, what we want to commute that out into the community. And then also just things we're interested in too. A lot of times it's us just we're on the internet work, curious reading about what's going on in that STEM industry and we'll talk about it amongst ourselves and we're like, this is a really cool thing to do, a podcast episode about.Kevin: And one cool thing that's happening is as we grow within Black & Veatch, we have more and more people reaching out to us with topic ideas or inviting us to go to conferences where, you know, we just came back from San Francisco at a Singularity University summit where there are topics talking about, you know, Bitcoin and digital currency, AI, space, like all these really cool topics and you know, we're getting invited to go there. So we find our topics via presenters at these conferences or you know, clients of Black & Veatch, you know, black and beaches worked with Tesla or Volkswagen with the electrify America. So, you know, our clients are also the ones who are out there innovating in this industry. So we're, we're being put in contact with a bunch of different people as well.Host: I mean, I tell that you guys were at Power Gen I mean, you guys do get around it. I mean, is it is it the podcast taking you there or are you going there and then using that for the podcast?Kevin: Well, I think it's 100% the podcast taking us there.Ryan: Yeah, we've definitely got a lot of support from within Black & Veatch. I mean they really liked the idea of the podcast and kind of what we bring to the table. And so Black & Veatch has really been supportive about, you know, giving us a budget. And that budget allows us to do things like, you know, buy new fancy equipment or go to these conferences or I may have you, so I really say it's a podcast that's really funded a lot of this. Yeah.Host: Yeah. I would say the you know, it doesn't feel like a Black & Veatch podcast if at all. It feel, I mean, I guess when you mention it, yeah, you do talk to a lot of Black & Veatch people, but it doesn't feel like you're doing this to promote the company, you know, which is great.Kevin: That's a very important point. We don't, we don't want to be a podcast that shoves Black & Veatch down the listeners throat because that will just be a turnoff in all honesty. It's an obvious marketing scheme and that's not what we are here. We're, we're basically utilizing our contacts because we work with these people. They know us, they reach out to us the most. But as we see I'm willing to bet if we were to look back, like the first half are mainly Black & Veatch centric, but as we started to expand and grow our network, we are focusing on I don't want to do you want to call it external initiatives and stuff like that. So we definitely want to utilize Black & Veatch when we can, but we also don't want to, you know, make it all about Black & Veatch.Host: Yeah. What looking back over all the, the episodes, what are some of your favorite episodes that people might want to, to listen to?Becca: Yeah. I think one of my personal favorites was when we had the opportunity to interview Eric Anderson who is the executive chairman for top golf and CEO for West River Group. That was a great opportunity because that's PR one because it was one of the most high profile people that we've been able to sit down and talk to, but also a lot of the business and leadership and entrepreneurship insights that he gave us were completely invaluable. And then also the additional content that we have on that episode. We focus on technology and sports and the three of us are really big sports fans. And so it was kind of like a wonderful merging of worlds and just us being able to really truly show our personality and show our interest on that episode. That's definitely one of my favorite ones. And Kevin's having a hard time deciding,Kevin: I've got a couple, I'll give you two, I guess. One of my favorites I guess I would say would be the Hyperloop, one of the Hyperloop discussions we had, and this was kind of more early on at around episode 10 or so. Yeah, but it was, I mean, Hyperloops kind of continued to get a lot of the limelight and just selfishly, you know, I learned a lot from doing that episode about what Hyperloop is. So I mean, I think that's on the kind of still applies today even though that was maybe one a year ago. And then the other one probably I would say is he's a little bit of a wild card. But Tom Friend we interviewed him at PowerGen. He just give a quick background. He's like, was what? He was in the air force and then now he w he was a consultant for Duke Energy. He's a scrum or like agility consultant. He's kind of all over the place. But super fascinating and intriguing guy. And that was probably one of my favoritesBecca: Talk about somebody who's passionate about learning. Tom Friend was the most passionate about learning.Ryan:  Yeah, he was, it was a fun interview. I think, you know, I just, I just want to say all of the guests you've had and all the topics we've covered are great. Let me just put that out there. My, my favorite is probably the Prekapa Sankar interview that we just completed at singularity university, mainly because this is a woman dominating the STEM industry at such a young age. She's on her second company right now and data and AI for good. Yeah. And that's like the future and that's where, you know, the probably going to be the dominating technology coming in the next 10, 15 years and she's already at the helm of it. And I'm more excited to have interviewed her then maybe about the topic just cause like I'm excited to see what she can do in the future.Becca: She's going to make a big impact on the planet. She, she already is, but she's gonna make really big impacts. So, yeah.Host: And I guess from your, from your visit out to Singularity or do you have other, other podcasts planned, maybe something on blockchain or something?Ryan: Yeah, we are. Blockchain episode fell through. We did get a little bit into it with Tom Friend, we'll say, but he, he was so passionate and so like educated on it that, you know, we try to slow him down and yeah, that's definitely something we need to do is like a block chain 101 episode because it is kind of like a really vague idea that's kind of hard to explain and process and we have a hard time understanding it sometimes. So definitely that would be something we want to help our viewers unders or listeners understand as well. So trust me, that's, that's on the list of ideas.Kevin: We do have an episode, one more episode from singularity to coming up with the CEO of Upwork. who was a Silicon Valley guy back in the PayPal and all that those days. So really cool guy. I got to sit down and talk with him about the future of work play more than anything else. So Upwork is a, what do you, freelance platform online like one of the largest and one of the largest in the world. And he has really great insights about what the future of the workforce is going to be like and how we need to adapt and how Upwork is helping the workforce adapt as well. Yeah. SoHost: Well you guys really get into a lot. I that you actually had, didn't you have one on space recently?Becca: We just released one on a little bit of a space topic. One of the more random, we interviewed the chief scientist, Bruce Betts from the planetary society. For those who aren't familiar with the planetary society, it's a non nonprofit crowdfunded space exploration and research company headed by the boy, bill Nye, bill Nye the science guy.Becca: Yeah, so it's his, his company. And Bruce bets was one of the people who led on the LightSail 2 mission. I can go into all sorts of details about that, but you can listen to our episode and you might learn a little bit more about what that technology is.Kevin: If you want to hear an interview that had absolutely no outline or plan, listen to that. Cause we literally grabbed him from off stage and interviewed him with no questions or anything, just kind of let the conversation go. And I think it was pretty funny and random because of that.Becca: And it's still super educational as well.Host: Well for, for if any of our members were listening and were thinking maybe they wanted to start a podcast, what, what would your, what your advice be for them to, to as a member of a member firm to get a successful podcast going?Ryan: Yeah. And I think this answer may apply to more than just a podcast. It's really anything that you think is kind of entrepreneurial within your company or just in general is I think just taking the bull by the horns and kind of holding yourself accountable. You know, Kevin was a ringleader of this, but just him making the statement that he thought it would be a good idea kind of puts the wheels in motion. And without that kind of first step you're never gonna actually achieve anything. So, you know, we, Kevin, myself, Becca, we didn't know how a podcast recording and the whole post-production, all that stuff, that was all new to us when we started out. But it's just something you kind of learn as you go. You know, it took us a while to release our first couple of episodes and kind of master what we we're doing. We've been doing it what for two years now and we're still not mastered. So yeah, just like any new skill or hobby, you know, it takes, takes time and takes initiative and action and kind of holding yourself accountable.Kevin: I guess from, from with inside a company, if we want to look at that mind frame, if you have an idea, I think in any successful company you're going to have leaders that support most ideas. And I think, yeah, like Ryan said, the biggest thing is speaking out, expressing your idea and then following through with it as Ryan said. But I think like the biggest thing was I spoke out in a meeting and there are leaders in that meeting that were willing to be like, you know what, let's run with this. We'll give you five hours a week, let's see what you can do. And since then, iteration after iteration, we've grown to have, you know, a larger budget but also make sure that whatever it is you're doing is something that you love. And I know that sounds kind of cliche, but one thing that we found is we're full time engineers.Kevin: So we work 40 plus hours a week doing engineering work or Becca with business development. And this is something we have to do on the side. And it's really hard to put in the extra hours when it's not something you enjoy. So you have to make sure you enjoy it first if you're really gonna be successful in it.Becca: I think just jumping off of things that they both said, we're really fortunate that there is leadership within Black & Veatch that supports innovation. They see the value in what we're doing here. And we feel really fortunate that there are leaders here that were willing to take a chance on us and help us progress through this whole project and see where it could go. So we're really thankful for that. And then in addition, yeah, the passion is super important. And then also just finding a voice that's different than what is out there now.Becca: We think that we had a, and we still do believe that we have a different perspective than anybody else out there on the podcast platform. And we have a voice and we have things to say and we're hoping that we're teaching people and they're learning and also just give, giving people a better perspective on what our industry is about and the kind of impacts we're wanting to make as well. Yeah.Ryan: And one last thing I would just add to that is, one thing I've noticed talking to a lot of these interviewees is most companies are passionate about kind of motivating and giving ownership to young employees. Most companies have a STEM related kind of program. And so I think you know, don't be afraid to kind of speak out and speak your idea. Like we've kind of been saying so far. Yeah.Host: Yeah. And from, you know, being in the industry, writing about the industry for the last 12 years, I mean, one of the big issues is how do you motivate your younger employees, you know, the, the baby boomers don't understand the millennials sort of thing. And this seems to be a an example of a way of doing it.Becca: 100%. Yeah. I think in general, us in the millennial generation are really motivated by kind of like a greater calling. I don't come to work everyday because I know I'm going to be sitting in responding to emails or doing calculations. It's because I know that I'm coming to work and I'm contributing to a better society, a better community, a better infrastructure, so that we as a community can live a healthier, more comfortable life. And I think that this is just another outlet for us to discuss that and try and get that out into the world a little bit more.Host: Well, great. Well that, that, that I think you've guys have covered the gamut here. So I'm, I really appreciate your coming on and I urge our our listeners to tune into the Close of Business podcast. You guys are on a Spotify, right?Ryan: Yeah. Spotify, Apple podcasts, any, any really podcast forum.Ryan: Yeah. The best way just to look up whatever you listen to on podcast closed the business and you'll find us. And hopefully you enjoy the episodes. And if you got questions or comments reply to us. But otherwise you can email us to that. cobpodcast@gmail.com. Awesome.Host: Well, thank you. 

Earlier this year, we helped migrate one of our first clients onto Shopify Plus. As part of that re-platforming, we tried a new app called Retention Rocket that had dramatic results. That shouldn't be a surprise if you're familiar with the co-founder. Dylan Whitman started BVAccel, the largest Shopify agency. His experience as an agency owner directly led to the creation of Retention Rocket You'll hear: How insights as an agency owner led to the creation of Retention Rocket Why rising acquisition costs are the biggest threat to your business The intentional reason they're NOT in the app store Ryan Somrak Started in the eCommerce industry 10 years ago running sales for Bronto software where they grew the company from 0-50M having never raised a single penny of VC funding. Successfully sold to Netsuite for 200M in 2015, and eventually purchased by Oracle in 2016 where he helped open their 1st Santa Monica location. Now Ryan heads up sales at Retention Rocket. Tune in for more details! Special Offer from Retention Rocket Retention Rocket: Free Install & Free Trial 50% Off 1st 2 months Platform Fee Dedicated resources to install for non-Shopify Plus stores. Show Links Example store: Yvonne Estelle's Transcript Kurt: Hello and welcome back to the unofficial Shopify podcast. I'm your host Kurt Elster in a beautiful kind of gray, rainy, but I don't mind Skokie, Illinois, high top, Westfield Old Orchards professional building in. This is my version of Wayne Tower in Gotham city. Anyway, I want to hop in the time machine and tell you a story. Kurt: A good eight years ago, early in my career before I was the Shopify guide and fully committed to it, I had an office and below that office where some retail shops and there was one wonderful shop called [inaudible 00:00:37] that sold fine linens and tableware and basically expensive French home goods for your house. And it really is very pleasant store to go into and it turned out the owner had an interesting background and was a fun person to talk to and she said, you know, right now my website, I think she used to like Front Page. She's like, I wish I had something better. I said oh I cold help you out with that. Kurt: And we got them on Presta Shop. And it was way better. But you know, over time it was a big pain. And she stayed on that custom Presta Shop theme we developed for seven years until at the very beginning this year we moved her to Shopify plus and it was just phenomenal. I mean you can imagine going from like old and busted to the absolute super car of a E-commerce platform that is Shopify plus, really had a phenomenal impact on her business. First just in time savings, then second in a better user experience that resulted in a higher KPIs across the board. And then third, the sheer number of opportunities that were opened up by apps. Like in the past, her Google shopping was, she was literally like writing her own Google shopping feed, manually uploading it. Kurt: I mean, just crazy stuff. So now we get to automate that stuff, which freed up bandwidth for this single owner seven figure business to then turn around and start trying new things. And of the new things we tried was one that utterly prints money and has been a phenomenal experience that I want to tell you about, and that's retention rocket. So it was new to me, I was skeptical, but it looked cool. The more I learned about it it sounded good. So I said, okay, well let's give it a shot. We tried it, and just utter phenomenal success. So I've got with me Ryan Somrack from retention rocket and I'm going to, we're going to pick his brain and hear about retention rocket and why he believes it is absolutely crucial to your marketing, along with a brief history of the platform because it's kind of interesting. Kurt: So Ryan started in the E-com industry ten years ago running sales for Bronto. It's my understanding that Bronto is like the enterprise equivalent of Klaviyo and he while with them went from zero to 50 million and ACV having never raised a single penny of AVC funding. Yes, a man after my own heart, successfully sold to NetSuite for 200 million in 2015 eventually purchased by Oracle where he helped them open their first west coast office in Santa Monica. And now Mr. Ryan, where are you? Ryan: Hey Kurt, now we are in San Diego. Kurt: And whatcha doing in San Diego? Ryan: Yeah. So I'm running the sales team here at retention rocket. Kurt: Cool. And what the hell is retention rocket? Describe it for me? Ryan: What retention rocket does right, is essentially we are a retention platform that is going to gear conversations with folks, sending the right message at the right time to folks, but most importantly through the right channel, right? So if you look at how E-commerce continues to become more competitive as merchants are duly pressured by the increased ad cost and new online competitors, as a consequence of that, right? Teams are getting leaner, larger merchants are cutting staff and smaller upstarts or are comfortable running lean, teams leveraging technology. Essentially what we want to do, right, is build a retention platform that can drive on its own for clients. So that way, again, when they are paying these customer acquisition costs to get people on their site, we're then capturing their information, whether it's email or SMS or Facebook or push, right? And so that way what we're able to do with deliver messages to retain those customers through whatever channel it is that they prefer. Kurt: All right, so recapping, we run, presumably a lot of folks run Facebook ads. Facebook ads, as we've discussed on the show, are getting more expensive than ever. So you've got this high acquisition cost to drive someone to your website and then once they're there, obviously we want to compete, keep them there. But even if we had some extraordinary conversion rate, like 5% , which would be super high. That still means that 95 out of a hundred people don't buy, but they still, we still spent the money on the ad, right? Kurt: So we want to convert, retain, as many people as possible into customers. So in the past that's all right, we're going to follow up with some dynamic remarketing and we've got like, if we're really sophisticated, we're going to send it a multi part, so like three or four abandoned cart emails. And that would be part of like a larger piece of software. What I'm hearing is in retention rocket, the sole focus of your automation suite is cart abandonment recovery, really. And in that like just have it, that's just the pure focus and it's doing it in more than just email, to multiple channels. Ryan: Yeah. So think about it in this way. Right? So we started off, it was only natural for us to start off in the SMS space. Right? So to kind of give you a brief history of retention rocket, right? So our co founder Dylan Whitman was running one of the largest Shopify agencies in North America, BB Excel. Kurt: Well truthfully, I like, BB Excels' reputation is great. I like Dylan with a lot. I met him a few times and that was part of my interest and willingness to try retention rocket. I'm like if Dylan is behind it, I need to pay attention to it. Ryan: Yeah. And so that's kind of the initial reaction that most people get when we talk about our, when we introduced SMS right up front, a lot of people are hesitant about it because their initial response is, hey, we don't want to pester the customer through text messaging. And usually our response behind that is, is, well, whether you're sending them a text message, right, versus an email, if you're sending out a four part abandoned series email, how much non pestering are you doing versus you know, sending them out a one time text message to try to recoup that through a different channel? Ryan: But essentially going back, right, so Dylan working with BB excel, what he was able to do is work with a variety of merchants in the world, right? Surrounding E-commerce. And he kept coming across a consistent problem with these E-commerce shops specifically on Shopify, which was retention marketing was just taking too many systems, too many technologies, and it was way too complicated to execute. And for the people who were executing it, it was costing them so much money to where they were constantly having to worry about the overhead cost of it. So at the end of the day, again, marketing tools should empower marketers and technology should not essentially bog you down. And so that's kind of where we wanted to focus the core solution, is how do we make a tool that's easy to use for everyone. And also a tool that when we turn it on right, you can start seeing demonstrable revenue day one. Kurt: That's, yeah. Well, that's always a great win for customers. I love that. The common story that we hear from entrepreneurs, from merchants on the show is they have a pain or problem in their own life. They identify a problem and they go, "Hey, I could do this better. Why not me?" And it sounds like that exact same path got followed in software by Dylan, and having you, you said, you know, hey, this thing's going to be easy. It's going to be a quick, fast to use. Having used the thing, that is how it feels like it is no nonsense. It's not bloated. It's not over complicated. Coming from a software development background. I appreciate dashboards like that. All right, so we've established where it came from. Walk me through a certain, you've got to have a roster of cool clients on this thing. Give me a few. Just drop those names. Ryan: Yeah. We work with a variety of clients. So think of like Ivory Ella, Pura Vida, Kopari Beauty, Head Kandi Pro, Brooklyn. And so those are just a variety of clients that we work with. And then from a total demographic standpoint, right? We work with over a hundred clients today, I, and we're constantly growing again, being only a 13 month old company, having a hundred plus clients. You can kind of see the adoption rate that this is starting to take place. Kurt: Yeah, I was going to ask, hey, when did this start? All right, so just over a year ago? Ryan: Yeah, February. That like the first week of February of last year is when we officially kicked things off. Kurt: Oh, so I'm imagine, you're just starting, you've probably got like these are the core things we fixed and I mentioned you've got a long roadmap, run me through, or we've established what it does, it's retention, but really, you know, we're gonna stop browse abandonment, cart abandonment. Walk me through currently the tools in your toolbox that let me do that. And then some of the stuff that's on the roadmap that's going to be coming down the pipe soon? Ryan: Yeah, so currently what we do today, right from think of it, from when we launched our MBP, was an SMS abandonment feature, right? So somebody reaches your cart, right? Or they reached the checkout page. Most people are already collecting a phone field in that checkout or cart page, right? And so what we're doing is we're collecting that opt in, right, and then we're triggering out an abandoned text message that goes out to those customers. Ryan: Additionally from that, right, we're also providing different opt in widgets. So think of tools like texts to opt in. So you'll walk into a lot of stores, especially on Shopify, what you see today, these clients are starting to run pop up shops. So what we're doing right, is we're allowing those customers to do like a text in campaign. So, you know, text Kurt, right to 12345 to receive a SMS, like specific promotions. Right? Kurt: Those are like, those work well as radio ads. I always hear those on like Sirius. Ryan: Yeah. Kurt: You know, like Howard Stern and they're like text blah blah blah 2345 to get here, you know, free info. Ryan: Yup. Yup. Kurt: Okay cool. Ryan: Yeah. We also do things like form builders, right? So we created, after speaking with some of our customers when we launched them, right? One of the biggest things, or the concerns that they had were, hey, we've been in business right, for ten plus years we've collected a substantial amount of emails, but we've never done text message marketing before. How can we start to convert those people in a rapid growth type way. So what we've done right, is allow them to create a separate landing page, whether it's on their site or whether it's one that we actually can create in the platform itself to where you can now start leveraging the email subscribers that you have and push them through like your normal monthly newsletters that encourage those customers to then sign up for like, mobile VIP offers through the site. Right? Ryan: So now you've got an email that's triggering out to your normal customers, giving them the ability to now sign up for another channel where they might receive let's say one to two messages per month and that could be just exclusive only to like those mobile users. So that's one of the other tools. Ryan: We're just also about to release a push notification tool, right? So our whole goal right, is to start now rolling out a lot of these separate performance marketing channels. And then for us, right, it's going to start to determine when these customers are so because we're integrated into Shopify, we're able to track when that order is completed. And so for us, right, it's again, it's not focusing on, hey, we want SMS to be the main driver of it. It's really to understand, hey, this customer is receiving three to four messages a month across email, push, Facebook and text, right? We're now able to track when this customer is purchasing so we can determine like when they should receive which message at what time and when they should start falling off the different engagements from those channels. Kurt: Oh, so you're adding machine learning to it? Ryan: Yeah. That's going to be towards like the second half. Now that we're starting to collect all this data, right? Our longterm goal is to start collecting those algorithms on when the customer is purchasing, when they're making that purchase, what channel they're making that purchase on. Right? So let's say if I set up, you know, a five part abandoned series, that five part abandoned series might be a five part multichannel engagement, right? Between SMS, push, email and Facebook. But if I know that the customer purchased after receiving a text message, they automatically fall off the funnel of the remaining channels that are supposed to go out. And then now I know, hey, this customer purchased through a text message at a, you know, a 5% off coupon as opposed to purchasing through an abandoned email where I might have leveraged at 15% off coupon. So again, it's starting, we want to start to leverage again, how you want to start sending out those messages to the customer. Kurt: All right let's walk through a practical example here, cause my fear is that people aren't grasping how cool this is 'cause it may be hard to picture between, you know, buzzwords like sales channel. Yeah. All right. That wasn't a great example of a buzzword, but the ... Ryan: AI, AI is a great buzzword. Kurt: Yeah I did say machine learning. Okay. So let's walk through an example. I'm, we'll go with you Yvonne Stills, since you started with that one, I'm on Yvonne Stills dot com ,I find like, oh, these are the place mats for me. I add these to my cart. I start to check out, the doorbell rings, I moved on. What happens? How are you going to fix this for me? Ryan: Yeah. Yeah. So from there, right on the backend, we've set up based on, again, working with Yvonne and understanding what she doing from an abandoned email standpoint because it's safe to say, right, most people are sending some type of abandoned email today. Right? Kurt: Lord I hope so. Ryan: Right. Yeah. And if you're not ... Kurt: Get to work. Ryan: Yeah, right. Yeah. You're behind the game already. So essentially what we did right, is we sat down with Yvonne to understand when those emails are going out from a time perspective, we know from our end, right, that went an abandoned text message is sent out. 97% of the time that message is opened within the first three minutes of receiving that text. So again, you got to think about when a customer is abandoning, they're really essentially abandoning for a couple of reasons. One, there's customers out there that are really just looking for a discount. The other ones, there is something that could come up where they might actually have a question of they abandoned, does the short coming a different color does the shirt, do the shoes coming in different size. Right. My kid threw up in the kitchen sink, right? So now I've got to attack that. Ryan: So essentially what we're able to do then, right, is trigger out that automated text message to go out after a unique set of timing that the customer chooses. Right. Some of them send a text message out within the first 30 minutes of someone abandoning. Some people send it out after two hours of when someone abandons. So for us it's understanding when they're sending an email. So that way we can determine when we should send out a text. So now let's say I've got an abandoned text that goes out after 30 minutes, right? I follow that up after let's say four hours of sending an abandoned email and then let's say 24 hours from then, right? I want the last notification to be through, let's say their Facebook messenger account if we've collected that opt in. Ryan: So now I've got three different channels that I'm now following up with the customer to say, to remind them the purchase. So let's say they then received that text message, they open that text, right? They click on the link that's provided there and then they make that purchase. As soon as that purchase is made, right? It's an notifying Shopify on the back end that that order has been completed. So what happens is, is they fall off any abandoned email program that was set up and they would fall off any Facebook notification that's scheduled to be pushed out. Kurt: Oh dude, sweet. It's painless and seamless. All right. So for my experience with Yvonne was like literally she was like, yeah, let's set it up. And then you guys set a meeting, and then like by that afternoon it was up and running and going. Is that, did she get special treatment because this is, this is one of Kurt's clients? Or is this just because it's this easy? Ryan: Yeah, no. So it really is that easy, right? So if you, if you look at it, right, the new breed of advanced and fast growing merchants, they just want, they just want software that works, right? They don't want to have to think about it too much. They want it to produce revenue in a way where you aren't bombarding individuals X number of times. And they also want to be able to turn it on. Right? And then kind of let it go from there. Ryan: So essentially during all of our on boards, that's when we, we sit down with the customer, right, to understand like, hey, what are the different channels that they're already working in today? And then the strategies behind that and then we introduce, right, what are the strategies that we see from a multichannel perspective work for our clients. We set up their campaigns, we configure the best practices behind that and then from there moving forward, right as soon as we turn it on. Right. They've got dedicated teams behind them to help assist in any way because at the end of the day, right, it is software. It's a certain channel that most people have not gotten into. So they need that hand holding experience, which is where we typically win most of the time. Kurt: All right, so devil's advocate question here is this thing lets you some retention messages through text, number one, and it's actually we should, it wasn't noted, you know when I tested it, it's MMS. So like I got a text message with the product photo in it. It was really cool. You're in push notifications, there's Facebook messenger, there are existing solutions that do all of those things individually. Devil's advocate question, like what's the difference or the advantage here? Ryan: Yeah, no, that's a great question. Right? So I think the biggest thing that we're going to be focusing on is that these tools that we're going to collectively put into the platform, right, are not going to be things where it takes an entire team to run those technologies, right? So I think that's primarily like the first and biggest thing is that, so ease of use is really our biggest focus. I think the next thing that is going to be the biggest game changer is that we're going to be able to start collecting all of the data and from a predictive intelligence standpoint, right? Predict from an automation way of like, Hey, we noticed that customer A converts 10X higher, throw an email at a 10% off coupon, push them down this flow. But we know customer B converged 20X higher through an SMS and no coupon at all. Right? Ryan: So maybe we want to save that coupon, right? For someone that we know purchases more through, let's say email, we're going to now push customer B through like the text message funnel. So again, it's starting to understand like, where the customers are purchasing and how often they're purchasing. So then that way you can start leveraging. Another thing that we're looking at right now is, is think of like post mail, right? So companies that we know have purchased, like maybe they purchased one time and they haven't purchased within the last six months, right? Send them actual postcard, a with an offer tied to that, right? Kurt: Does it do that? Can I do that now? No? Ryan: No. It doesn't do that now, but that's exactly what we're working on. Right? So ... Kurt: That's be cool. Ryan: It's not leveraging just one channel to try to steal an attribution from another channel. We could care less about what, you know, what channel makes the sale. Right? We literally just want to understand from a customer viewpoint, right, which channel is communicating to that person and which channel they're responding the most with. So instead of say, hey, I want to have an email platform, right? And then I want to have a Facebook message platform that's going to try to take the acquisition away from my email, right, now you've got two conflicting platforms trying to steal the attribution. For us it's more about understanding what these customers, or where in the funnel they're making these purchases from first and foremost. Kurt: Yeah, it's an important distinction that I had not picked up on, that is a big advantage is you've got better attribution as opposed to like last, touch attribution that a lot of these platforms use, so you have like multiple apps all taking credit for the same thing. It's silly. Ryan: And the hard part of balancing that is right is when we start chatting, like when we go that deep with customers, a lot of the times we're having those conversations with customers that have never done SMS before, So now like you really have to kind of dial it all the way back and and look at first and foremost and say, okay, what are the retention strategies that you're doing today? Most people that we talk to are like, our retention strategy isn't that strong. We're really focused on the customer acquisition side, which we can completely understand and relate with, especially as technologies are changing and the rapid pace that E-commerce is going through. That's a valid point. But people, I think in the next, you know, in the next twelve to 24 months, you're going to see a dramatic change and people trying to focus on how do they grow the LTV of a customer and then how do they grow the AOV of a customer. And that's where I think retention is going to like take over by storm, right? Ryan: It's because now you've spent all this money to get somebody to your page, so now it's a matter of like how do you get that person to then not only convert one time on that page, but to keep that customer for let's say 12 months, 18 months, 24 months, and to take them from $60 in revenue, right to $120 in revenue over the course of that 12 months. Kurt: It's absolutely a safe bet, as acquisition costs keep getting higher, eventually currently profitable E-commerce businesses won't be sustainable anymore unless they have that shifted focus to, okay, let's focus on retention and we're going to, you're going to see that represented in a few key performance indicators where, all right, what's our lifetime value? What's our average order value? What's our repeat customer rate? And I think you're absolutely right. Not like, if you're thinking, oh, that's a hot take, it's really not. It's inevitable. Ryan: It really is. And again, it's not to focus on one channel over the other, like email, like you hear these things, that email is dying, right? Or email is going away, right? That's just 100% false. What's happening, right, is that there's just been so many email providers, right, that the space in general is just a bit saturated and email is so cheap, right? That people can send, you know, five, six messages a week to the same customer. Right. And it's relatively inexpensive, which is why I think email is going to continue to be around. Ryan: Our position, right, is you need to find, you need to find a real like, almost like painting a picture, right? You need to find a way to where you're not just focused on one specific outlet to start responding to that customer and that's all part of like what we're even learning as a company. Right? Do we know if a back in stock reminder is better notified through push notifications than email or text? Do we, you know, do we notice that hey, a new product launch or, or let's say you know, basically hey an update to some new products that we're rolling out. Like should that be going through an email as opposed to anything else? Do we think a buy one get one free sale is more geared towards SMS then email or push? These are all things that like we're starting to at, and which is I think going to be the biggest proponent of like how customers start to trigger out their marketing messages. Kurt: No, absolutely. Okay. Going backwards a little bit. What is the, if we've got all of these channels unified in one app and we don't have to deal with a bunch of separate apps and now we're collecting this data. Okay. Then it stands to reason. You may have a cool dashboard, but it's also, it's a 13 month old app so, I don't know if it isn't there yet. Talk to me about the reporting and what that dashboard it looks like a little bit? Ryan: Yeah. So right now we're able to look at total messages sent right from a channel perspective. So if you sign up and you use like our Facebook tool, if you sign up for obviously SMS and push, right? We'll the able to tell you how many messages are going out through those various channels. We'll be able to report on how many people have opted in through those various channels. Then we can take a look at a sales attribution's as well as revenue generated. Right? So what we're going to be doing moving forward is we're actually going to dive in a little bit deeper from a reporting standpoint. So from like a customer level, right? You can actually look at the customers who have opted in. You can see things like their their last purchase. You can see things like the last item that they abandoned. Ryan: You can see things like total orders that they have on your site. You can see the average order value that they have on your site and we're actually putting them into predefined segments. So then that way when people start to send like outbound promotionals through text or through push or through Facebook, right? You're now able to maybe not send the same message to everyone. You can now start to dissect, hey, I want this message with free shipping to go to customers that we know have purchased more than twice. We want the customers who have purchased less than twice, right to receive, maybe like 5% off or something like that. Ryan: So from there, right, we're also going to be tracking things like opens, clicks, conversions, and then we're also going to be, from a diagraph standpoint, being able to show you exactly where customers are opting in. So, for example, right, if we know that we've got 30 customers that sign up for the text to join campaign versus maybe 15 people who have signed up by abandoning a product versus 10 people who have signed up after completing a purchase, right? You obviously want to know where some of these folks are are signing up. So then that way you can also determine like, which message should be going out to those folks as well. Kurt: So dope, dude, so sick. Ryan: Yeah, it's exciting. So we're super stoked, you know, like at the same time we've got, you know, we've got a two year roadmap, that like we're looking ahead on which is, you look at that and you're like, shit, like that's a long roadmap. But you think of like where E-commerce is going to be, you know, two years from now. I mean just over the last 12 months, like it's changed so radically, just with the changes that are happening within Facebook itself, right? Like, and the customer acquisition costs between now and 12 months ago. There's just always a constant radical shift. So for us, right, it's the challenge for us is, is staying on focus to the roadmap that we have in hand and making sure that we develop a product that again, is easy to use for the customer. And then first and foremost drives them revenue the moment that they turn it on. Kurt: So cool. Yeah. Well that was what amazed, me was how rapidly we were able to get the thing going and making sales. But one objection possible, objection here some of the brands you rattle off, I know her on Shopify plus Yvonne Styles is on Shopify plus. Do you have to be on Shopify plus for this thing to work? Ryan: Yeah, great question. No, you don't have to be on Shopify plus a to use the APP. So right now in its current state, right, we work with Shopify plus and people who are on Shopify, you know, either regular, or if they're on Shopify advanced and Shopify itself is just such an easy platform to work with. It's also a reason that we wanted to start there before venturing out. Kurt: That makes sense, on the topic I noticed like all right, another devil's advocate question. This thing's not in the Shopify APP store and I noticed like there's some big popular apps that aren't in the APP store. What's the deal with that? Ryan: Yeah. So in our current state, right, we're really focused on building, with how young we are still in our current state, we're focused on building one to one relationships with our customers and solving their problems. I think over time, right, as our product eve continues to evolve, you'll see retention rocket in the app store. So we're definitely looking at something like that. We just want to make sure that from a timing perspective, that we're able to deliver right, what the customers are looking for. Kurt: That ambulance you order just arrived. Okay. Nope, that makes sense. The way I'm hearing that as if it was in the APP store, anyone could just click install retention rocket. It's much harder to scale that experience, versus right now it's easier for you to work one on one and have that very high touch onboarding by having it just, okay, you sign up for it on the retention rocket website. Ryan: Yeah, because here's a perfect example of it, right? We get someone who's never done text messaging before, right? They download the retention rocket app in the APP store having never done anything with text messaging before. Like, their question is going to be, you know, what's the best way to op customers, via SMS, what's the best practices on sending SMS, right? Do I send once a week? Do I send twice a day, right? Do I send once a month? So these are all questions that for each customer, they're all going to be different, right? It depends on are, you know, are you a Pura Vida, right? Versus you know, a TAF clothing. Like are you selling $30 items right, where you don't care what the discount is a or are you selling, you know, $400 pairs of shoes that you're not discounting at all? Ryan: So for us, right? It's really a matter, the tool we know will be effective, right, when done the right way. And that's why we want to sit down with those customers and really understand like what they're doing today and how we can incorporate retention rocket to take them to the next level. Kurt: Cool. So what's, what's the typical ROI or results of using retention rocket? Ryan: Yeah, that's a good question. Right? Kurt: 'Cause it says you've got so far, you've got a 20 million that you've revenue increase for retention rocket customers. I see that on your website. Ryan: Yeah. I mean our average, I would say for people who do, from an abandoned cart standpoint, right? I'm just from a recovery standpoint and we've got customers that average anywhere from 300 to a thousand bucks a day, even more, right? Like I don't want to single out the people that we see doing like 4K a day. And I know that's a big average, but it also determines, right, again, like the amount of traffic that they're driving on their site, right? And the actual, the cart value of when someone abandons, right? Ryan: So I'd say typically, on average you can see about 300 to a thousand bucks per day in revenue. The conversion rates that we're seeing a range anywhere from 19 all the way up to 38% right? We've got a reach a fashion retailer down in Auburn that when we turn it on and we ran a 30 day performance forum, they drove over 40K and sales. They had a 46% open rate and a 38% conversion rate. Kurt: That's crazy. That's nuts. Ryan: Yeah. You think about it, right? If you, if you're doing an abandoned cart emails exceptionally well, you're seeing anywhere from let's say like a 12 to 15% conversion rate. Right? That could be fair. So imagine, right? If you increase that even another 9% or 10% what's that doing to the bottom line of the business, and for some of these folks, right? Who are just starting, you know, on a Shopify, an extra 300 bucks a day in revenue is a really big impact for them. So that's kind of some of the things we've seen from an outbound standpoint, people who were doing, I think you'll start to see more and more of this as people start to engage with SMS more, right? Ryan: The average ROI that we see is anywhere from a nine to 10X on those out bounds. Kurt: Alright, you've already sold me on it, stop selling, I want it. How much is it going to cost me? Ryan: Yeah. Right. So we do it based on different tiers, right? So it's based on the amount of orders that they do per day. So it could be anywhere from 99 bucks a month all the way up to 1000 bucks a month. And then from an outbound standpoint, right, they just pay a per message costs on those out bounds. So if they send a regular text message, or like a regular hundred 60 character SMS, you're looking at a penny per message. If they send an MMS like you were referring to earlier where they send something like a picture in there or a Gif, right, you can even include a two minute video inside those tax. You're looking at two cents per message. Kurt: That's cheap. Is there a set up fee for it? Ryan: Yeah, so typically there's a setup fee. So what we're going to do for anyone who wants to try it out, right from, from viewing on the podcast is we're going to do a free install for them as well as ... Kurt: Alright they're gonna shake you down. All right. We'll do a free install. What else do they get, any more? Keep it coming. Ryan: A free install. We're going to do a free trial for them. Kurt: How long is the free trial? Ryan: Yeah, the free trial will last up to 30 days. Kurt: Okay. Free install ,free trial. Gimme more. I need more? Ryan: Yup. Yup. You're going ... Kurt: Let's turn those pockets inside out. Ryan: So if they want to sign on right after after the trial, right. We're going to do 50% off their first two months of the platform fee. Kurt: Oh yeah. Okay. All right. That's you've been properly shaken down so we get free install free trial, 50% off for the first 60 days. Did I miss anything? Is that everything? I mean this is pretty good. All right, where do I go to get started? Ryan: So you're going to, there should be a link that's provided to the podcast, right? Kurt: In the show notes, all right. Exactly. Yeah, so in the show notes that they sign up through that link, it will then generate back to us to give them that special promotion. All right, listener note. If you're on you're on your phone, tap or swipe up on the episode art and it will open up the show notes and you'll find I will stick that in there. Like big heading, special offer from retention rocket. We turned Ryan's pockets inside out and then that will have the link, like a special shortened link that will take you to the page to get the offer. Or if it doesn't, I'm sure you could just, when you're doing the onboarding doc, I heard about you for Kurt, give me those free 60 days nerd and they should help you out there. Don't call him a nerd though, I guess Ryan: Say whatever they want when they sign up. Kurt: Cool. All right, well here I got one. An odd ball question for you. What apps have really good synergy with retention rocket? Like if I really want to make sure that I'm getting the most out of retention rocket, is there anything I should already be doing that would make me a good candidate for it? Ryan: Yeah, right. So I'd say the, the platforms right? That we're working right now on to build some pretty cool use cases. So [inaudible 00:34:56] won, right? Clavio from like an email perspective, smile.io from a rewards. Kurt: Love smile. Ryan: Yeah. Right. So we're working on some really good use cases with them on how they can incorporate SMS to their client base. Right. And then we're also working, we're going to be working pretty closely with recharge from a subscription standpoint, which I think will be, will throw out some really good use cases on people who obviously are abandoning subscriptions or things like auto refill reminders. So stuff like that is going to be down, actually not, pretty far away. So we'll be rolling those out pretty soon. So I think like people that are using those technologies seem to play really well with retention rocket. Kurt: Super Cool. Wow. All right. I got to go sign up. I gotta go sign my wife up for retention rocket. Thank you Ryan. This has been fantastic. I'm inspired. I got to go set this thing up. Ryan: Yeah, we appreciate it, man. So thanks for the help.

So you are working a day job and you are wondering what can you do to get to your financial freedom sooner, rather than later!??!! I met Ryan who is living that life. He has a great day job, but he also wants to do something on the side to help build his financial foundation. Ryan not only figured that out, but he created a system that makes it possible to use his discretionary time wisely. Tune in on this interview as Ryan shares his secret!! Grant: Welcome to another episode of financial investing radio, so I'm very excited because I have in the house with me today, a visitor that I just recently met through someone that I know online and they pointed me to this person. They said, Grant, you need to talk to this person because he's doing a kind of investing that I know a lot of people in the corporate world think about, which is this uncertainty of what's gonna really happen to what's going on in my life, but without going any further. Well let me back up and stop and say, welcome. Ryan. Would you take a moment and introduce yourself? Ryan: What's up everyone? Ryan Helms here coming to you from right now, dark outside Atlanta, Georgia. But uh, yeah, I've been in Atlanta for about five years now. And uh, you know, I create content to help people with nine to five jobs, create freedom in their life. Grant: That's really cool. So how did you arrive at this? I mean, you just one day say, hey, this might be a good idea. Are there must've been some sort of impetus that got your attention and said, hey, I better do something about this? Ryan: Yeah, so for me, I, moved up to Atlanta for my job, which I have no disdain for at all and I came up here and I spent about the first two years I really kind of nose down kind of work, like you know, I'm going to make a name for myself in this company, which has worked out quite well. It was a good strategy, but it got me to a point where I wasn't burnt out, but when I looked up it was on the horizon and I knew I had to like step back, pull myself back for a bit. And unfortunately when you're early in your career in corporate America, you get about two weeks vacation and yeah, it's kind of unfortunate, but I'd used all two weeks of that because I sat on the couch which is about eight feet behind me right now. And I bought a plane ticket to Nairobi, Kenya and had no. Yeah, I had no plans at all. I was literally scrolling the Internet, had no intentions to buy a plane ticket on that Friday night, but I purchased that plane ticket because it was $750 and I thought, man, that's a pretty good deal to go all the way to Africa. I did that and that was in July of 2016 and I made the trip November of 2017 or no, November of 2016 and you know, while I was there it was just. First of all, it was an amazing experience. It's like going on a safari and spending a week on Zanzibar and all this, all these cool things. But you know, as cliche as it sounds, I really had like this epiphany moment when I was there. I was meeting all these people that were doing all these great things in their life that we're allowing them to have this freedom to travel. Like I was meeting people from all over the world and oftentimes they had different paths on how they got there and how they were traveling. Some of them were on vacation like me, but a lot of them were traveling for like two years and I'm in a year and all these things and when I left there I didn't necessarily know what I wanted to do because I'd never had that mindset before. It was always like it was. Yeah. That was like working in the corporate, Grant: So you are thinking "Hey, I'm being a good employee." So you're in the grind, right? And then you saw a flight where price was away from value. I think they call it a sale, right? There's a sale and you're like Nairobi, let's go! So you run into these people out there that are like, they're traveling around. So this pop that idea in your head. All right. And keep going. What happened? Ryan: Yeah, absolutely. So, uh, I'm on the plane ride back from, from Nairobi, Kenya, coming back to Atlanta and I said I, I need to, I need to create this freedom my life. Unfortunately I look at my bank account and I was about $55,000 in debt, not counting like my mortgage. So like consumer debt. And I said, alright, so how can I expedite the process of paying this debt off? Because that was the, that was the first thing hanging over my head that I knew if I wanted to be free quote unquote free, however you define that for me, it was financially free. Like I didn't want the burden of, uh, have that hanging over my head and have to make decisions based on money. So, uh, I said, how can I speed this process up? So the next thing was how can I create alternate streams of income? Right? So when you're working in a corporate environment, you can't just walk up to your boss and say, Hey, give me a 20 percent rate. Is that Grant: Well, you can try that, but how far does that go? Not far! Ryan: So, uh, so I just started to, for one pull the reins in on my finances, on my budget, things like that really started to understand it because I made good money for my age being at this time, probably like 28 or so, uh, and made good money enough to where I never had to look at my bank account. And I never did. I just knew I had enough money to spend and never was like, it was like I didn't know the password to my Wells Fargo account, that kind of thing. I just knew that I could do what I want it to do and not have to look at my bank. Grant: Maybe you were rich in the world's terms in the sense that you didn't have to look at your bank account, you were free a little bit, right? And you said you didn't have to look too much. But when you saw these other people on your trip you realized your current salary wasn't giving you the freedom at the next level. And that was the epiphany, right? Ryan: Yeah, absolutely. So I spent a, I spent some time figuring out how could I, how could I help speed up the process of, of paying this debt down. Uh, and then I came up on, okay, I'm going to start a side hustle, so I'm going to do something outside of my day job to help, uh, put me down this path. And the first thing I did was always been into fitness and things like that. So I started this a fitness business on the side focused on corporate individuals and it was called corporate fit in. That was going well in through that process though, I had a lot of people asking me how I was doing everything because at this time I was traveling around the world for my job, so I was constantly on the go and still putting out content, still building this business on the side and I didn't know how to answer people and they said, how are you doing it? I was like, I don't know. I'm just, I guess I'm doing what everybody else will be doing if they were doing this. Now stepping back though, I realized it was the systems, right? That's what was allowing me to, to manage all these moving parts in my life was how much I had systematize things. So that was a turning point for me. I said, okay, I don't really see myself doing this fitness thing. It doesn't thrill me. Like I enjoyed fitness because I liked working out. I didn't enjoy it as much when I was helping other people. I created the why. First off I had said, all right, I have a process, I systematized my life in this way to enable me to do this, and I sat down and put pen to paper. The output of that was a physical product called the side Hustle and journal, which I ended up launching on kickstarter a November, so almost about I guess 10 months ago now. November of 2017. Grant: Cool. Alright, so 10 months on Kickstarter. So you said something interesting you came up with this system, the system that the intent of the system has to help someone take themselves through the fitness experience. Is that right? Ryan: So the system that I was referring to was the system on how I was actually a managing my nine to five job, quote unquote, doing all this stuff on the side, hanging out with friends, still still having some form of a social life. That's the system I remember referring to it Grant: That's your system lead people to help them create their side hustle; while they have another job. So there's a lot of people that are in that situation right there. They've got the day job, they want to figure out the side hustle. You've got the system where you figured this out. So it's been 10 months, it's been out there. What's been the impact of that? What have you seen? What have been the results? Ryan: Yeah, it's been cool. So on, on it was really challenging because like I said, I had no audience at all going into this space and I went in it kind of backwards to most people. Most people start like on the content creation side, build some awareness for their, their personal brand, things like that. I like to make things difficult for myself. And went with the physical product right off the bat. Surprisingly I convinced 600, a little over 650 people on Kickstarter to back the project. Uh, so that was a good start to kind building my list. It was kind of a jumpstart to building my list. And since then it's been awesome. I've been really focusing on interacting with that community, really giving them an authentic view at me. So making it, like really showing them, I'm not a guy just selling them a product, I'm a guy like them. I'm a guy on this journey with them, uh, trying not so much to put myself on this pedestal above them. Show them that, hey look, I'm just following what I'm doing. I'm just like you, like if you come on this journey with me, what we're going to cross the finish line about the same time. So that's what I've been doing the past 10 months is, is bringing people on that journey, uh, leveraging the physical product itself as a way to get people to come on that journey with me. Right? So that's, that's the entry point into my ecosystem right now. Uh, so yeah, that's kind of where I've been at the past 10 months. Grant: That's amazing. So, so the style of investing, given financial investing, radio style of the investment here is that you have a way to leverage your discretionary time to produce additional income in your life and make a change without rocking the boat in terms of, you know, you're stable work and stable for now all with the intent that you're shooting towards. So do you have an idea how long it would take for someone applying your system? Regardless of how they apply? Right. I mean they could apply it anywhere from a creating embroidery products to selling books or whatever. Right. You use it for anything, is that right? Ryan: Yeah, for sure. Grant: So if they applied the system, what sort of timeframe would they expect as a two year or three year process where you think they could break free financially or get to that next level? Or does that depend hard to say? Ryan: It's probably too hard to say based on individual factors, but I think what you'll gain right off the bat is the systems that will enable you to leverage this time and actually like it's like finding, you know, you find money in the seat cushions and things like that so that you find time in all of these places that you don't realize you actually have time and it all goes back to just being very intentional about what you're doing and you know, the journal itself and the system within the journal is about discovering like what do you want to be intentional about and then how can you maximize your time around it that could give you time to do a lot of things. Not only could it give you time to invest in yourself by, you know, creating a side hustle or a business on the side, but I mean you could even, it could free up time to do actual investing. Maybe the stock market is what you're really into, right? This system. So could be the foundation for developing your new investing strategy. Doing the research, who you want to getting more methodical about those processes that are required to do really anything, whether you're investing in yourself or in the market, so, uh, it could really be applied to anyone in the amount of effort that you put in will determine the speed in which you reach it. Grant: I heard a seminar recently from a guy by the name of Alex Charfen. You ever heard of him? Ryan: Yeah. Grant: And Alex was, he said something that sounded kind of similar where he said that he has this thing called a a time study, I think was the term he used, which was take a moment to think about how you're spending your time. And he said, I guarantee if you take two weeks to really evaluate and log and write down how you're spending your time, he said you will find places where you are wasting a ton of time and that will free up to then be able to do the kind of system you're talking about. Is that right? Ryan: Yeah, absolutely. And I agree 100 percent. If you don't put it down in front of you, you'll think you're efficient with your time, but there's going to be inevitable gaps in the product says, you know, the reason I put out a physical product for this and I've had so many people saying you need to make an APP, you need to do this. It's because there's so much activity going on in your phone, right? There's so many things and beings and bongs like every two seconds for something like this as important as like getting time back and, and, and creating something great, but out into the world, you need to carve out a section of non-distracted time and really figure out, you know, what, what do I need to do, how can I get there? So that's, that's what I'm all about. Exactly. As you know, putting it down on paper and putting it in front of you and visualizing it. Grant: How much, how much non-distracted time does a person need in order for, to, to make some effective progress? Is Fifteen minutes enough or does it need to be more? Ryan: Uh, for me, I think it needs at one given time. I think it needs to be more, I think the, the uh, you know, the length of period of time should be definitely longer than 15 minutes. I would say at least 45 minutes so that you can, it'll take you 15 minutes, get focused on what you want to do and if all you have is 15 minutes and you have 15 minutes every two hours, yeah, you may be getting, you know, three hours worth of work in that day, but you'll probably only get about 15 good minutes worth of work as you will be starting over every 15 minutes. And as soon as you start to get in your groove, you're going to be, it's going to be over again. So I like to try to carve out a larger block of time of at least an hour so I can make sure I can get focused on what I'm trying to do and actually execute on something. Grant: I think that makes a lot of sense. I've seen multiple studies where people have identified the cost of a distraction in terms of productivity in every time we get distracted with the amount of time it takes in order to get the context back into your head so that you can begin to be productive again. That sounds like that's what you're describing. Absolutely. I used to. I used to ride a lot of code earlier on in my life and my career and every time I'd get distracted, right, it pull me away. It would take me a long time, like 15 minutes, get get into mine, mine everything where I was right in solving a particular problem. It was so expensive to do that. It sounds like you've optimized on that principal to help people invest in themselves, to invest in their future by taking advantage of the discretionary time they have to really reach the real goals. That's cool. You're good. Anything about goal setting as part of this? Is that. Is that a key part of your system provides? Ryan: Yeah, so the product itself, I always say like the backbone of this tool is what I call it, a molehill system. Grant: So why, why do you call it the mole hill system? Ryan: Uh, I was sitting at a Starbucks one Saturday morning working on this and I knew I had this system in it and just from a marketing standpoint, I knew I had to name it something, right? It couldn't just be, it couldn't just live in here. And I was thinking and I was like, man, I was like, don't make a mountain out of a molehill because that's what a lot of people do. You have this, this little obstacle in your way and you just stay in there for months looking at it because you're just so terrified of it. So like the, my thought there is, is you're breaking down, you know, this big mountain into these really manageable mole hills that you can just easily surpass on a daily basis. So the mole hills or things that you're doing every single day and the mountain is what you get at the end and you don't actually ever have to climb the mountain. It's just basically the finish line at that point. Grant: Oh, I see. So the mole hills or series of steps that take you up to the mountain. So what's been the impact of people that have applied the system so far? What have you seen? Ryan: Yeah, so that's one of the coolest thing for me is the satisfaction from just seeing people use the tool and the community that it's creating. So one of the things I did with the Kickstarter was create where it's like an accountability system. So I said, you know, if you want to back this tier, one of the things that you'll, one of the offers in this tier will be all partner you up with somebody. And actually just, this has probably been about three weeks ago now, but I got a uh, I got a email with a picture in it from two guys. And at first all I saw was a pitcher and I was like, why are these two guys sending me a picture? And they were in Milan and I can tell they were in Milan because of the cathedral and the, and one of the guys was from Switzerland and one of the guys was from New York and they were sending me the email to say, thanks for connecting us. This is my accountability partner. We decided to meet in Italy. We'd been working together for the past eight months using the journal. So yeah, things like that are just awesome. And just to realize that you're impacting people and knowing that there's probably other people out there that aren't sending you those emails that are impacting as well. So it's been very, very cool. Just to, uh, just to see how an idea in my head most nights mostly created in a Starbucks down the street is changing people's lives. Grant: That is really awesome. I appreciate you sharing that. That's all happened. Just within the 10 months since you put it out there, if someone wanted to go find your materials, wherever they go, did they go find it? Yeah, Ryan: Sure. GritAndHustle.co; it literally right there on the front page. If you want to check out the side hustle journal, you can get it for free. Just download the free PDF there and if you want to get a hard copy you can get that as well, but feel free to just download the paper version printed out, see if it's for you and if it's for you, awesome. Let me know if you have any questions. I'd be happy to help. Grant: That's awesome. Very good. Okay. Any last comments, thoughts before we wrap? Ryan: Just, you know, a lot of people say this, I think it could actually further closing comments, but just take action. Get out there, create freedom, whatever that means for you. Like for me, uh, I think about freedom as being financially free to do what I want to make decisions, not based on money. Freedom for you may mean something totally different. So figure out what that means for you. And then start taking action so that you can get there. Grant: Okay. So it's GritAndHustle.co. Got it. Excellent. Ryan, thank you for joining. This is Grant. Thanks for joining another episode of Financial Investing Radio. Until next time, take some action.

We are excited to have Ryan Cox, Principal at Founders Grove Capital, a real estate investment and advisory firm dedicated to helping clients select and manage real estate investments that work for them. Ryan is responsible for helping clients select and manage real estate investments so they can build a more secure financial portfolio. Ryan hosts The Real Estate Innovators Podcast and he is a real faculty for drawing out some of the inside baseball elements of the real estate tech world. When he is not hosting his podcast, he is the CEO of Founders Grove Capital! Tune in as we talk about... Multifamily Real Estate Investor Real Estate Technology or PropTech Design in Commercial Real Estate Block Chain Platform and much more! Learn more about Ryan Cox on The Real Estate Innovators Podcast and Founders Grove Capital VO: You’re listening to Raising Your Antenna, with host Keith Zakheim. Keith: Welcome to Raising Your Antenna. And I’m your host, Keith Zakheim. Today, we have a guest, Ryan Cox that wears many hats. Being that this is a podcast, and many of you, like me are podcast addicts, let me give you Ryan’s podcast bona fides first. Ryan hosts a real estate innovators podcast, in which he interviews some of the bigger founders and influencers in the real estate tech/proptech market. I guess Ryan, one of the things we can kinda talk about is what we call this industry because I’m hearing a lot of names for it: proptech, real estate tech, other things. But anyway, Ryan’s podcast is a great listen. And he’s a real faculty for drawing out some of the inside baseball elements of the real estate tech world. That I think is great gold or father for investors and professionals in the real estate and the real estate technology space. So anyway, definitely give a listen. But, when he’s not hosting his podcast, Ryan is a CEO of Founders Grove Capital, where he himself is a super successful investor and advisor to investors. So Ryan, before we get going and kinda get into the nitty gritty of our conversation today, maybe give my audience some of your background, professional background. And also specifically, you know, why you do the podcast. You know, is that kind of a personal passion. And also, how it helps your business from a marketing perspective. So anyway, welcome aboard and, yeah, it’s to you. Ryan: Well, Keith. Thanks so much for having me on the show. Excited to talk about a little commercial real estate tech, a little about my business. So, my background is, you know, I really, primarily, my primary business is to focus on multi-family value-added opportunities. So, my core business is as real estate investor and working with investors to buy multi-family assets here in the state of Texas. The podcast, as you said, is developed, I guess, primarily, out of a passion and some curiosity. So, I found it to be, you know as an investor, a really great avenue on a weekly basis to really dig in to all of the, you know commercial real estate tech that is developing around us. And the podcast has given me an opportunity, you know, really, a calling card to knock on any door and talk to founders about their background and unique insight that they had in their background to lead them to found a commercial real estate tech company. And on the podcast, I’m really just able to, you know, dig in what their background is, what unique insight, talk about the solution, how it benefits and impacts their users. And then try to suss out, really, just their insights from their work, about how they see the overall real estate market and that changing, and the impact of commercial real estate tech. I think the big driver for before the podcast is, you know, number one is I’m an advocate for my investors. So, I feel like it’s a priority for me to really be able to have a broad view of all of the technology that is, really, just starting to make an impact. But, I believe in the next three to five years, would dramatically shift the way that a lot of business in real estate gets done. So, I wanna make sure that I’m not flat-footed and that I’m being an advocate for my investors and paying attention to all the real estate tech that is transforming how we do business. I think.. Keith: You know, I, you’ve, again, being a listener to I think your last two episodes. I think you do a great job of listening that kind of feedback, and getting really down to the founder’s course to both your entrepreneurial side as well as your passion. Specifically, of this CRE-tech space. So anyway, I enjoy and I encourage my listeners to download it, become a subscriber, and listen cause it’s really, it’s a great listen. So, let’s dive in and my first question Ryan is that you know, where in, when I say we, I mean you and me from the marketing side are in the super-exciting space of what we call CRE-tech/prop tech. But, there are tons of applications found in the market. So, if that big data applications and, or you know spaces service as a business, virtual marketplaces and leasing tenant focus platforms, private management, augmented reality, and others. Clearly, some are getting more ink than others in space as a service comes to mind. But, as an investor and an advisor, I’m curious in your perspective. What are the exciting areas, that maybe somewhat under the radar right now. So you know, trying to bring somebody into a no-tell where we work. Okay, no big deal. Lots of money’s going there. That’s just aping what everybody else is doing. But, what are the areas, you know, applications that you think have the potential for real disruption, will attract early adopters, and in the next few years, where should the savvy investor who really wants to be part of the space looking to allocate money? Ryan: Well, first of all, I think that there are a ton of really interesting across, you know, like you said teantt project management. There’s a really, really quite a few interesting, you know spaces to play in CRE-tech. I think, as I think about the next two or three is we’re just so early. Especially regards to adoptions, it seems to me like the folks that are focused on data and that could be a cross-spaces as service, virtual marketplaces, leasing tenant project management and that stuff. The folks that are taken a data first enabled to monetize that early, enabled to give users actual data to make decision for that real estate investors, for lets space users, you know building owners. It seems to me like those folks are probably to the best start because there’s a value they can charge users afforded data. But, the collection of that data also gives them flexibility as they grow out, you know, the solutions that are provided to end-users. Keith: Yeah, we see for example both in CRE and also this residential real estate is, you know, a lot of these companies are multi-generational families that abound, you know, especially in the big cities, right. So, they own a lot of the office space, they own a lot of residential real estate, and they’ve been making money in this space for a long time. And as a result, the little more buttoned-up conservative, unless, willing to be early adopters. And we found with our clients, is that the case to be made at least initially, is surely an economic play, right. So, this is how you gonna be more efficient and save money. But, you know, how, what do you see is being the most partner-compelling arguments to, you know, CRE-tech as CRE-owners in order to get them to kinda take that first leap of faith into some of these, you know, applications and areas. And it could be, you know, big data which is maybe, there is some would have, you know, an easier, a leap of faith from data, the argument for efficiency and economic savings probably easier than making, also, I realized much more quickly. But, how do you advise your clients, or what do you see your founders in terms of being able to, you know, circumvent or achieve some of those obstacles? Ryan:Well, I think that from a founder’s perspective, you know, I think the venture community has great channels into, you know, big, you know, big brokerage. I would just definitely in avenue to get widespread adoption across a numbered users and geographies. I think that a lot of the bug development companies have their own adventure arm that you know, co-investing with the venture firms or looking to, you know, incubate and grow their own, you know, own kind of tech. So i do think that there are great opportunities with the right venture partner or being able to sit with the right investment or development company to help kinda scale the platform out. So. Keith: So, how are you looking for money for for example. It's not just about the money, but the strategic value that these investors can bring in terms of opening up new channels and helping with initial adaption? Rayna: Absolutely, the faster to market in adaption. I think is what you see in the re-work examples. They are just trying to raise the biggest, the best and have amass the monopoly. I think that the fastest routes to market, the more channels that you have to be able to deploy the product, the better your chances for success. Keith: Yeah that’s a great segue to the next topic I want to discuss, which is basis of service. And companies like re-work, and notel raising money on previously unthinkable valuations. I have a 2-part question. So, clearly, there is some type of bubble forming, and this not the first tech-vertical or general investment vertical to experience a bubble and there’s a lot of money-chasing deals and we work in (notel) just based on evaluations are clearly benefiting from all that money that’s on the sidelines looking to invest in this space. So, it’s 2 questions. You know, it’s not new what we work in (notel) are dealing, right. So, we just been around for a long time. Yet, we are left behind in the dust. These newer companies are gobbling up market share and their valuations are significantly higher. So, what’s been the drivers of their growth versus what we’ve seen in the past? And the 2nd question, Ryan, which I know comes up everywhere. Which is, you know, we work in (notel) have experienced, any other companies by the way just keep referring to these two, but they’ve experienced this growth in a real estate environment in which the market is just fantastic and also experiencing above all, right. What’s that gonna look like when there is an inevitable downturn. That’s what real estate is historically, so it’s not gonna continue and values are not gonna continue to appreciate and as I understand their business model which is, you know, leasing up a lot of space and being able to upsell that to tenants. What happens when, you know, values go down and their existing tenants can go lock in space for much cheaper prices. So, 2-part question: drivers of growth versus the history of the space as well as what it’s all gonna look like during an inevitable downturn? Ryan: Yeah, those are good questions. I don’t think anybody can accurately predict. But just some thoughts. I think, you know, running we were.. Keith: The beauty of being a podcast, of being a prognosticator, is that they only remember when you’re right and when you’re wrong, no one cares. So, that’s, you know, we can say whatever we want. Be Nostradamus, right? Ryan: Right. Well, if we were on video, everybody would be able to see me in my wizard hat. Keith: (Laughs). Exactly. Ryan: My answer here. I mean, (Ryan), we were cause undertaking the company’s taken a name as an approach to spending, investing heavily on growth, in hopes that profits will follow. I think, in the most likely scenario, is that, the thing that’s been driving growth in valuations for these companies will ultimately will come to roost. You know, right now, we’re in a growth at all cost negative gross margins. I think that we workers gotten so big that we’re seeing a lot more access to their data and, you know, right now, their focused on growth in a winner take all mode similar to some other tech companies we’ve seen at Silicon Valley. You know something , the ultimate challenge, so that goal is that if you can grow to a large size and create a market monopoly. Then, over time, you’re able to, you know, raise prices because you’ve got some sort of walk-in with those customers. I think the challenge right now in the current environment is that there’s so much private capital out there and so many entrepreneurs willing to take on big dogs. It would be a re-work at this case but people with. I think you need value proposition in a co-working space. So, on a venture capital people chasing, I don’t see right now that there is a monopoly in place. And then those companies are public, so you know valuations that can be tricky. Just a tricky area when we talk about private money. So, the question will be if there is a downturn and we’re not in a profitable place and that money dries up. How do you sustain growth or shift on a dime with your users to a profitable model. Keith: Yeah, for sure. I do, you know, so you mention Amazon and Amazon first of the 15-year run and they probably are the exception to the rule in terms of being able to early on stake-out they wouldn’t call a monopolistic position but certainly, 800-pound gorilla type of corporation. But, if you look at ride-sharing. So, a company like Uber tried to do that but the market was so large. The problems of executions are great and the amount of so much money on the sidelines willing to go into that space. Left has been able to significantly cut into their business over last few years with no one inside there. It seems to me also, the spaces service industry. The various entry are really just raising the capital. I mean, I don’t know there’s much secret sauce in doing that except for being able to sustain the losses initially and go gobble up property. So, it’ll be interesting to see how that shakes out and what it all looks like in a number of years but I know everybody in our industry is watching that closely and that will be interesting as we go forward. Ryan: Yeah, totally great I think. I definitely think the spaces services creating a value for large enterprise and small businesses alike. It’ll be up to those organizations to find a profitable, sustainable, long-term business model, which is yet to be proven. So, I think that there will be some, I think that there’ll be winners, I think that there’ll be losers. I think that there’ll probable even a few that rise to the top and are able to sustain there long-term. Keith: Alright. Moving on. Entrepreneurs and startups and certainly marketing agencies, we love the buzzwords. Alright, so, you can raise money and you can throw out terms like artificial intelligence or augmented reality or blockchain or cryptocurrency and figure out how to present your business plan and I think companies or startups are hoping that investors will follow that with investment. So, blockchain is a bit, is a buzzword that is being thrown around, our industry, the CRE-tech industry. We do a lot of work and energy and I thought blockchain is a fantastic application of blockchain platforms with application in the energy markets because energy in general’s becoming a lot more distributed and decentralized and blockchain is a fantastic application for industries that are going in that direction. We’ve seen a number of companies over the last 6 to 12 months that come to us and claim to have some type of blockchain application real estate whether that’s for raising money, whether that’s because it can cut out some of the soft-cost involved in transactions, whether it’s because of blockchain application will make shrink the timeline for these transactions. There’s a number of reasons why blockchain could be a good application in the real estate industry. Curious what your thoughts are as to what those applications are? Are you seeings things that right now are more substance and hype? Do you think at this point just more hype and people throwing around the word? What’s your take on all that? Ryan: I think there’s a lot of hype, I mean, blockchain is really just a lot of copies of a gigantic cell spreadsheet. So, I think that there’s some interesting possibilities for blockchain. Clearly, to the number of hands that have touched a transaction to potentially cut out intermediaries. I think that there are some regulatory things that need to happen as those boundaries get pushed. I think that it’s a move in the right direction but whether it’s blockchain, artificial intelligence, a machine learning, there’s a lot of entrepreneurs that are tackling that technology and trying to integrate it into their business and or their philosophy. When you talk to the technologist about where we are with those technologies and what they’re capable of doing, there’s somewhat of a sentiment that, yeah, the baseline is there but today they don’t function as they’re being promised or advertised as. So, I think that is commercial real estate technology is playing catch up to a lot of technology innovations from, maybe the past 15-20 years and that started to really grow inside of commercial real estate maybe in the past 5-6 years. I think that this group of entrepreneurs is in the right place and on pace or the slightly behind fintech or other spaces where they’re trying to develop the technology to truly make an impact. Keith: Yeah, we’ve spoken with a few companies recently who feel that blockchain and cryptocurrency solution will enable owners and CRE owners to have opportunities for liquidity and to bring in partners or investors in a way that they can’t with the current financial and legal infrastructure in real estate. So, that’s what, from what I understand from these companies, they think they can be deploying those solutions relatively quickly. It’s a proof in a pudding. Ryan: Yeah, I mean. Title company, all kinds of things, potentially make an impact or just we’re not there today. I think, we’ve got smart entrepreneurs that are working on solutions and are really trying to develop that technology to make it viable. And, where we are today versus where we’ll be in 5 years, is one of the reasons I have a podcast or I’m on this show, talking to you about it because I’m very interested in watching those developments and understanding how people are leveraging the technology and using that technology to change the way we work, live, play.. Keith: Yeah, so let’s talk about play. Another great segue, is Ryan, you’re a great host. So, when you’re the guest, you can do my work for me. That’s perfect. I wanna talk about apps and platforms and features that companies now are offering to enhance the tenant experience. It seems like a very millennial thing. So, in my company, we’re always kind of our executive team is always discussing. Alright, so, how do we make millennials happy, keep them productive, make sure that we’re able to retain them? And, I started my business 15 years ago, I wasn’t really having that conversation. It was more around, let’s just create professional development opportunities, make sure paying them fairly, and treating them with respect. But now, they want things that are gonna enhance their social experience, logistical experience. Work is now just not about work but it’s responsibility of companies and now it seems like maybe a building owner’s as well to provide a home-like experience or social experience, cultural experiences within the 4 walls of the workplace. Companies like Comfy, I've seen HQO, Office App, Equium. Again, they’re going out there and trying to convince owners and landowners that their responsibilities transcend just a physically-built environment. What’s been your experience in speaking either with your clients or with founders about the receptivity towards this? Who’re gonna be the early adapters? Is this just kind of like a fad right now but, we’re gonna eventually go back into haywork is work? What do you think on that? Ryan: I think that broader society is just moving towards more experiences whether that’s the bloomers who are moving out of houses then looking for less kind of ownership responsibilities to give them opportunities to travel, to go and do, to hop on an RV and go across America. Keith: I’ve got a 19-year old so we’re having these discussions which give me a little me more grey hair than I had prior. Ryan: (Laughs) And you know the 19-year olds in the same boat. How do I create more experiences, driven by a very different and very visual world with Instagram, Facebook, Social. It’s a ‘hey, what experiences are you having?’ And I think cause it’s less driven by the material. When I think about the specific applications that are going after a different experience in a work environment. I again think it comes back down to the channel. I think that the broad offering, well I guess, the appeal to many users will be more applicable if it serves out more as an amenity that people are able to choose from a la carte or a part of a package. Kinda like a TV dinner. Say ‘Hey, wanna be able to have access to all of these different applications to be able to create this experience in our work environment.’ I think that somebody’s applications are very niche. And so, if they’re not paying attention to the channel or how they’re partnering with other applications to create that experience could potentially be an uphill battle. But, yeah, I mean I think that experience-driven is what is driving re-work or notel or the other kind of space as a service. I think that when IBM is taking re-work space, it’s a very clear communication to the market that experience is valued and IBM’s one of all those technology companies out there so, it’s not just the startups, the millennials that are focused on creating that experience for their employees. Keith: Yeah, that’s a really good point. So, a lot of our listeners are themselves founders and entrepreneurs. I thought maybe, we’d just end, Ryan, with just your observations of the common denominators between the companies and founders that succeed, those that don’t. That really can be anything from leadership skills to how to manage money, to operations, to figuring out audience, marketing. Whatever the case, but I got a thought that your advice would be compelling to the people listening. Ryan: Yeah, I think that those with a good product and user experience. I think about some fintech apps, like Robinhood. When Robinhood comes to mind, it’s like very easy to use, it’s very visually appealing. So, I think that applications that are focused on great user-experience. I think that have some sort of data or value that they’re able to charge customers from Day 1 increase sustainable profitability. And I think that just have really low overhead, low volume kinda revenue targets to keep them accountable to grow. I think that they’re gonna have, those that start with that business model will have early adapters that are potentially more forgiving of the product, that are able to receive feedback, to really shape the product, to listen to customers’ demands and pay attention to their roadmap in a unique way that keeps them from over-building or steering the roadmap in a direction that is actually not a demand or want on their customer base. Which is, back to my earlier talk, was those that are due to a really good job of aggregating and creating actionable data, will be able to build off that data in a meaningful way, and create a roadmap that is really impactful for their users. Keith: That makes sense and I think for every founder and businessman and entrepreneur, what Churchill always said to his people, ‘Keep buggering on KBO.’ Just gotta stick with it, right? And, there’s gonna be lots of ups and downs and challenges. But, if you believe in your vision and you believe in your product and believe in your ability to execute, then you gotta keep going. Certainly, until the bank account says zero. So, with that Ryan, I think we’ll end there. Was there anything else that you wanted to add or tell our listeners? Ryan: I guess the one thing I would add is I am co-hosting a commercial real estate tech event in Austin on October 25th. We’ve got a great panel of tech founders that includes Michael Mandel with ComStak, Arie with WiredScore, Ryan Turner with Refinery, and Doug Shenkman with Tenax. As well as a panel of venture capitalists from Fifth Wall, Navitas, and Metaprop. So, it would be a great event downtown Austin with food and drinks and some great founders and venture capitalists to give you much of the same conversation about the state of the world of CRE Tech and the state of the market, and what’s coming up. Keith: And I will be there. So, if that’s, if you wanna scream that from the rooftops as well, enables you to add one more person to the event, feel free. Maybe, if you tell enough people, my mom will come as well, if I’m gonna be there. But, Ryan: We’d love to have your mom. Keith: It’s an exciting event, I will be there. I’m gonna be travelling from New York to Austin for it. And, goodluck with that. I guess, I’ll see you there, Ryan. So, thank you for being our guest today. And just again, for our listeners, Raising Your Antenna is a podcast dedicated to bringing on venture capitalists and founders who are transforming B2B technology spaces including today’s CRE (Commercial Real Estate) technology. Antenna Group which is the primary sponsor of Raising Your Antenna, is a digital marketing and public relations firm which services companies from startups all the way to Fortune 100 companies that are in the B2B technology space. So Ryan, thanks again and look forward to seeing you in Austin. Ryan: We all look forward to it. Thanks, Keith! Keith: And another episode of Raising Your Antenna is in the books. I hope you enjoyed today’s episode and look forward to connecting again next week. Raising Your Antenna is a weekly podcast hosted by yours truly, Keith Zakheim, that features the movers and shakers, and key influencers of the B2B technology industry. Our guests are leading revolutions and disruptions in the mobility, clean energy, healthcare, and real estate technology industries. Raising Your Antenna’s brought to you by Antenna Group, a full-service digital marketing and public relations agency that focuses on the B2B technology industry. Please be in touch with me on Twitter (@czakheim) with any feedback about this podcast. And check out Antenna Group at www.antennagroup.com if your organization is looking for really smart and good-looking marketing and public relations partner.

Ryan Daniel Moran was a preacher-in-training turned entrepreneur. He moved to Austin with little to nothing to his him name, and launched Amazon businesses that he eventually sold for over 8 figures. Ryan did us all a solid – really – by documenting and sharing his journey. The Freedom Fast Lane Podcast helps entrepreneurs at every stage of their business, from startup to exit. In this interview, Ryan shares his top three “mistakes”, or as discussed, things he wishes he did differently as he looks back. He openly shares his story and journey, in the hopes that other entrepreneurs do things to maximize the value of their business (and life). Through Ryan's conference, Capitalism.com, he helps bring like minded entrepreneurs and experts in the ecommerce space together to build brands and businesses that last. While he may be a preacher-school-dropout, Ryan still has a way of delivering the goods when it comes to advocating doing the right thing…so good things follow. Episode Highlights: [1:25] Who is Ryan Daniel Moran? [4:38] Is it better to buy or build? [6:43] Ryan thinks we're in a “seller's market” [8:05] What are Ryan's “mistakes” and what would he do differently. [11:30] Does it matter if you like your buyer? Does likability matter? [13:52] The likable buyer story…who won out over an all cash buyer. [15:12] Mistake # 1 – playing the short term. [17:25] Mistake #2 – telling people what to do and diminishing their talent. [18:51] Ryan shares his staffing team numbers. Inhouse and remote. [20:06] Mistake #3 – Ryan wishes he spent more money on advertising, customer acquisition, and brand building. [22:51] Why is a 100% Amazon business worth less than a Shopify store? [24:00] What channels would Ryan expand to – beyond Amazon.com [25:30] The first “nut you have to crack” [27:02] Ryan disagrees with Joe! [30:40] Brands last, product businesses don't. [31:06] Should you be thinking about a possible exit at all times? [33:05] What gives Ryan the “goosies”. Ok…he didn't say goosies, that was JLo. [33:58] Know what you will do with your money before you sell! [36:10] Should you plan your next brand before you sell, or stay focused? [39:29] How do you get more Ryan Daniel Moran Transcription: Mark: So if I could go back in time I would do a number of things different than I did in my entrepreneurial past especially before I sold my first company. And I have told you the story before that when I sold my first company I sold it for $165,000 only to find out that a year later the same person who bought the company got an offer for 350,000 without changing anything about the business at all. So … and there's a lot of regrets I have by not going back in time obviously I think anybody would like to have that ability. Joe: I'm glad it's that instead of saying you're bringing me on as a business partner. Mark: Well, you're here so I can't … I might not say that to your face. Only when you're on vacation and I have somebody else filling in as guest host. Joe: Well, Jason doesn't listen to the podcast, let's talk about him. Mark: Right. Exactly. Joe: Conversation … no regrets there. Yes and Daniel Ryan Moran was our guest and he talked about some of the regrets or as we called the mistakes because that's how he learns in life as many of us do by making mistakes and in trying not to make them over again. Fascinating … fascinating yes they're our podcast today Mark. I don't know if you recall … if you were there for his presentation at Smart Record over the last summer in Austin but he got up on stage and he spoke for 60 minutes with no script, no PowerPoint presentation and everybody was captivated. And the information that he has in it … volume of entrepreneurs that he works with and the velocities, and the approach, and everything about the way he does business and the way he literally … I mean not literally, preaches business. Okay, he's a … he was going to be a preacher so I want to say preacher school dropout. He chose to be an entrepreneur instead but the way that he talks about things is spot on with the way that we see the most successful entrepreneurs run their businesses. They focus on a number of different things and they implement those and maybe someday if they choose to exit they're in a great position to do so. Ryan talks about all of that including his own two exits that combined totaled over eight figures. Mark: Daniel Ryan Moran, same Moran that comes from Freedom Fast Lane right? Joe: Freedom Fast Lane Podcast where he talks about his story. You know five years ago he had a car and he drove to Austin, Texas and he decided he was going to launch an Amazon business and record his journey. And his journey is not over yet. It's on a new adventure, a different larger adventure but his journey kind of came to a new chapter after selling the last Amazon business that he had. But he talks about it all the way through on the Freedom Fast Lane Podcast. He got tired of seeing people do things the wrong way and learned ways to cheat at conferences and started to do his own conferences through capitalism.com and bringing good like-minded people together that build strong foundation long term value businesses and he talked about all of that today. Mark: Fantastic I can't wait to hear it. Let's go to it. Joe: Hey, folks, it's Joe Valley from Quiet Light Brokerage and today I've got somebody that a lot of you might know already. His name is Ryan Daniel Moran. Ryan, welcome to the show. Ryan: Joe thanks about having me in, let's make some magic. Joe: Listen I was having a barbecue last night we had some friends over and this is an absolute true story and one of them is an entrepreneur wannabe. She's in the corporate world and she bought some Amazon products and she tried something and it didn't work but she's going to go at it again someday and she's grilling me … she always asked me how things are with Quiet Light Brokerage and she starts asking about the podcast. I said yeah we're doing all right and hey have you ever talked to Ryan Daniel Moran just like that and here you are today we're talking to you. You're kind of a little celebrity I should say … little, you're kind of a celebrity; a rock star maybe for this … look it was a 50 year old woman. She's rather attractive and she knows who you are. Ryan: Well you know it's like my ideal market is attractive 50 year old women. We all know that that's the market I'm after right now. So tell her to give me a … maybe call me maybe. Joe: She loves listening and the fact that you're first and foremost helping people that's what she loves about it. She says someday she's going to get back to it but she loves listening and she's going to take that leap at some point in the future so good for you. And listen as I said prior to the intro we don't do fancy intros. So if you would … I know it's hard to talk about yourself but give folks a little bit of background about yourself; who you are, where you came from, and what you're all about. Ryan: Yeah. I invest in and I start physical products brands. And the way that I got to that point was actually as a pastoral student back in 2006. I built my first website and started my first business in between high school and college on my shared dial-up computer in my living room and hand coded websites using raw HTML in a software program called Dreamweaver. If you are old enough to remember Dreamweaver and you know it well. So what's funny is we hear a lot of people who are talking about building and … or selling businesses thinking about the good old or either like all the opportunity is gone now or the good old days have these … man, I was hand coding websites in Dreamweaver on a dial up computer. Do you realize how much more opportunity we have now being able to build websites on platforms and sell products on Amazon? So the opportunities are way way bigger now but I was just trying to find a way to supplement my … what I expected to be $30,000 a year salary as a pastor. Now fast forward a few years I did not finish the pastoral route for reasons that would be probably best left on a second podcast that you have Joe that's going to be called quiet skepticism. Joe: Yeah, some kind of … something where we're helping people, we're guiding them off that path right. Ryan: Exactly; quiet go to the light we'll call it. And I did not finish that route and I became a full time entrepreneur. So I was in really involved in the internet marketing space for many years until I really decided or realized I hated that crowd. I didn't like hanging out with those people. So I was like what a conference where those people hung out and I took the skill set that I had from Search Engine Optimization from Pay-Per-Click Marketing from Email Copyrighting and I applied it to physical products brands. And I've had a couple of different exits in the physical products world and now I'm an investor in physical products businesses because it's what I know. It's who I can help the most. And I think it's one of the biggest upside is in the market right now whether you are selling or building a business or buying a business, I think there's a tremendous amount of white space with the transition from big brands into more what I call micro brands mostly Internet based that's where I see the biggest opportunities right now. So that's a … I've had a couple of exits and the total over billed were eight figures in cash exchange. I still own a minority stake in a few of those businesses and have a portfolio business but my primary focus is investing in physical products brands and I have a media company for entrepreneurs at capitalism.com. Joe: Okay, so when it comes to investing people look at buy versus build. In fact, we had a podcast recently with our newest broker Walker Diebel who wrote about a book called Buy Versus Build and there's a really long subtitle and it was a … it quickly rocketed to the top 10 podcasts that we have. And you're talking about investing, do you think it's better to buy versus build at this point in your career or would you recommend somebody that's just starting out to scrape some dollars together and bootstrap something and start? Ryan: Yeah, it's better for me to invest but it wasn't better for me five years ago. In 2013 when I took my first sale on Amazon.com for a physical product I know business investing in physical product brands. I know businesses buying physical products brands now … back then I was buying a lot of websites. And you know what I was buying Joe? I was buying search engine friendly websites with email lists … social media followings weren't this big back then, but with audiences, followings targeting each market that sold affiliate products; because that was what I knew. Joe: That's what you knew. Ryan: I would have been a lot of people who are like looking for the system and that you are the system. You are the machine. And your machine is unique to you. So applying your machine to different opportunities is where value is created. So for me, I'm … at this point, I have more upside as an investor because I already have all the retail connections. I have the connections to sell businesses. I'm connected to other investors. That's my own skill set but the entrepreneur who I invest in is way better suited to start that company than I am and that's what capitalism is. Where I get the value that I bring in combination of the value that you bring and when we bring them together it's greater than the sum of our arts. And so for me yeah I'm … I have more value as an investor but to say like it's better I think would be a mistake. Joe: You know I think you're absolutely right. It depends upon the individual's situation without a doubt. I bought and I've sold and I've invested as well and I can say each were successful in their own way and each were very very difficult in their own ways as well. You'll learn along the way from the mistakes mostly. Ryan: If I could Joe I will add though, I mean globally I think we're in a seller's market. I think we're looking at buying versus selling if I give it a binary choice I do think we're in a seller's market right now. Joe: I have to agree with you 100%. When we have a good quality listing come … I had a conversation with someone this morning who wants to buy. And he's a referral from somebody who already bought and this guy is doing great so I want to do what he's doing. And the response is look when a great listing comes along you need to be prepared. So the more listings you look at the more you're going to know the right shit when it comes along. And you need to be able to act fast because you and a dozen other people are doing the same thing and they're going to make an offer on that business. So I agree it's a seller's market but at the same time, the multiple still don't get pushed too high. It's still the buyer to decide that. You and I as sellers, as brokers can pick whatever number we think the value of the business is but we don't make the final decision at the end it's usually the buyer. The seller's got a lot to say about it because they can say yes or no. But it's still the buyer makes the decision in terms of the value for the most part. But you just recently said you've exited a couple of different times in the last few years. What did you learn in that process if you look at the exit? Or maybe do you want to talk about the fact … the mistakes you made maybe building and what you can do to help the entrepreneurs that are listening or perhaps the exit and maybe a little bit of both. Ryan: Yeah well, there's one thing in particular that I think was on the stake if you will and it was thinking that the buyer had all of the control. By the way, this is C money right here or by a … my … he is the one who wants to make great on the Internet. Joe: For those listening and not watching somebody just walked into the background. Ryan: Yeah, so the mistake that I made was thinking that the buyer had all of the control. And if I could redo this Joe, the truth is if you built something, if you built a business you're the one with the asset. You're the one with the goods that money is chasing you, people want to buy you and so often the seller comes into market and is like the thing that I'm after is the check and I'm hoping that I get the check and that immediately puts you in the frame in which you're the after. You're the one who is not in the power position. So we share them with an offer and the seller is like thank you please oh please Mr. Money Pants I would like your money. And now they're in a position to beat you up over earnings, over … in the negotiations. So what I wish I had done was recognize the fact that I'm the one with the goods. I'm the one with the asset that people want. I'm the one courting the offers. People are making offers to me. There they want one I got not the other way around. So if you're in that position and you're willing to say no and you combine that with the turn ship that says here's what I'm looking for, that to me puts the seller in the frame of mind repair and the negotiating position. I didn't do that. I discovered that after the fact and I really could only have learned that by going through the process. I learned … I personally learned by making mistakes and paying for them later. Joe: We all do. Ryan: Yeah but that's a mistake that I wish somebody had told me before I went to market. Joe: Or is it … the buyer that you're referring to is it a strategic buyer or did you have your business officially listed and people came to you? Ryan: Yeah, we had it listed and we were acquired by an equity group. I still own a minority stake in that company and I'm in great terms with the equity group. I'm really happy with the buyer. I have become friends and obviously business partners at this point. But had I gone to the market with terms that I wanted I probably would have ended up in a more favorable financial position when it came to closing. Joe: Well, the next time you have a transaction you'll know that and you'll be able to make adjustments. Ryan: Right. Joe: Really I think like you said the check isn't the end all, it's more about … I think almost in many ways what your next adventure is going to be. I know that a lot of folks that I work with and myself included when I exited I was just … I sold too late. I was emotionally tired and I think that's the absolute wrong time to sell. You should sell … you should plan to sell, just don't wake up and decide to sell. But when you're emotionally tired you're not doing everything that you can to maximize the profits of the business and that's going to drive down the value. And you're going to get beat up at the end if you're so committed to that check that you can't negotiate a little bit more for something else and be willing to walk away from that buyer if they're if they're not a good buyer. And correct me if I'm wrong but just tell me how you think here, I always find that it makes an enormous difference if you like the person that's buying your business or the one … if you're buying a business from. It's not just about the check. It's not just about the money. It's the people you're doing business with. And I think that as a seller you can get more value if you're respected and professional and likable and the same as a buyer, if you're a buyer and you're professional and likable and complement the owner on the business that they built that you're going to get a better transaction out of it versus all the hard core raw street negotiations. What are your thoughts on that? Ryan: I don't know if you are right or wrong because I intentionally don't do business with people that I don't like. [crosstalk 00:15:45.7] Joe: So, therefore, anybody that wants to buy a business from you if you don't like them then you've got to do that to work with somebody you like. A classic- Ryan: I don't think everybody has that mentality though. I think I would even go as far as to say the majority of people are buying and selling based on numbers or like the deal and very few entrepreneurs get to find every purchase as a person. And so I think most people are approaching it by numbers and logically rather than is there a connection here. I personally … just like for the protection of my own lifestyle am willing to say no to anything that I personally don't like. And what that does is it always puts me in a strong negotiating position because if I don't like somebody I have no problem walking away. And the person who has … the person who is most willing to walk usually has the upper hand in the negotiation. Joe: I agree 100%. I find that from a buyer's perspective one of the questions I get a lot from buyers if I'm up on a panel or speaking or something like this is how do I negotiate up against an all cash buyer, somebody that's got more money than me? And the tried and true answer is really is be likeable. It's … you don't necessarily have to have more cash to get the deal done and I … the classic example is I sold a business last fall. It was about two and a $2.5M and the guy had two full price offers within the first 10 days. One was from an all cash buyer who was a little rough around the edges and was hard to work with. The other was from a really likable guy who was buying with an SBA loan and actually required 10% seller financing in that. The entrepreneur, the seller of this business had the choice; you could go for the all cash or you can go for the guy that he liked. He actually chose the full price SBA buyer and chose to carry a 10% seller note versus working with somebody that he didn't like. So in that situation, I think it makes a difference in terms of … buyers that are listening be likable. If you're working with a broker you absolutely have to be likeable because they're … as you said it's more of a seller's market. And there's a lot of buyers out there. There are buyers that are competing for that same business and when they're likeable they're going to build rapport and when you build rapport you sometimes learn about things before they hit the market as well. Ryan, talk to me about some of the mistakes you've made in your own business. Maybe two or three of the biggest mistakes that comes up at the top of your head. Looking back and learning damn I screwed that up if I ever do that again I'm going to it a different way. Ryan: Well, every time I've made a mistake it was because I was playing the short term. So when I have made short term decisions I usually make bad decisions. I like to say that the longer term that I can make decisions the wiser I am and the better decisions that I make. I said before that people forget that behind every purchase is a person … that goes for customers too and all relationships are long term relationships. Or the best relationships are long term relationships. So if you are aware that behind every transaction is a person and you play it like it's a long term relationship you end up building the better company. Sometimes in spite of a short term decision, meaning … for example as we're recording this there's a … in the Amazon there's a thing we're calling review gate where Amazon is coming in and hit them onto your businesses and removing their reviews. And it's been a bloodbath. It's been absolute bloodbath. And the people who are soaring through it are people who have been doing of the right things the right way for the longest. And the people who are being hurt the most are the people who are the most profitable over the last couple years because they played the tactic game. And like there's absolutely room for tactics inside of every business but those who have been building really solid brands and building audiences and building followings they're going to soar right through this and capture a whole heck of a lot of market share. So the mistakes that I made were always in saying what's the Band-Aid solution here rather than building for the long term. So we take a rule now in the business that we're building, we say okay here's the situation that we're in rather than talk about how we're going to fix it let's say what do we wish we had started doing 90 days ago and that would have made today a lot easier to get through? That's the decision that we need to make today which is a really hard conversation to have when you're in reaction mode. But we force ourselves to ask that question because it usually addresses whatever the root cause is that we need to fix rather than going for a Band-Aid solution. So that being mistake number one, mistake number two would be as a leader telling people what to do. There's a great book called Multipliers that really morphed my brain in terms of how I can affect [inaudible 00:20:52.9] people. And what I realize after reading that book was that I have been diminishing the talents on my teams by telling people what I wanted them to do rather than casting a vision and inviting people to build their piece of that. Now that seems kind of a nuance and maybe overly simplistic but I couldn't emphasize enough the accountability that this book brought me on how much I was diminishing the people that I was working with, And the difference in energy and growth that happened once I started correcting those issues. So as an entrepreneur, we often have like our baby that we're bringing in to our team and we're telling people how to build the baby when reality if we're working with smart people they'll probably own that area of expertise better than we can even if we can't see it. And the big distinction of that book highlights is someone who diminishes their team is usually the smartest person in the room but a real leader makes the rest of the team like they're the smartest person in the room. And that was a huge shift in my overall happiness and with the growth of my companies and it's something that I wished that I had done before I was building companies to sell them. Joe: What kind of staffing do you have just out of curiosity? Ryan: Well, the company that I just exited was a team of four. The portfolio of companies … of brands that I have is a team of five. And my media company capitalism.com is a team of six. Joe: And are all of those people in-house or do you do some … or the VA's are they working remotely or they come to the office every day? Ryan: I'm only counting in-house people so that does not count freelancers. But no not everybody … we have … there's, we are a distributed team. So like I'm recording this in my office right now, one of my team members is just right here my side. But people will come in and out. Some people … like we have a team member in Canada, we have a team member in Germany, but they're all full time dedicated to [inaudible 00:22:47.0]. Joe: Good. I asked that because you know most people that are listening would probably be considered lifestyle entrepreneurs and they have to outsource staff and VA's and people working remotely. So it's good to know that even though they're not coming into your office every day this is really important [inaudible 00:23:02.3] get their short term vision don't have that long term vision so that you don't have major major stomach aches with algorithm updates we'll review gates in that situation and then over managing of the staff you know let them be their experts; anything else that comes to mind? Ryan: As far as big mistakes that I've made … I mean we talked about the mistake in selling and as far as building the business I'll say I wished that I had spent more money on cold advertising. Like always like there's never been a business that was like ah you know I think I spent too much on advertising. I've only ever said I wish I'd spent more on advertising. Joe: Yeah, where would you have spent it because these are primarily Amazon based businesses correct? Ryan: The businesses that I personally built, yes. Joe: Right. So where would you spend that money? Ryan: So we just identified the problem because you said they were mostly Amazon based businesses so had I done things even better I would have doubled down on non-Amazon advertising. Because what … if you're an Amazon business which is like nails on a chalkboard to me because it means you're dependent on somebody else. Joe: Right. Ryan: It means that you're dependent on this channel and you've got to go double down on building a business has a different leg to the stool and that when you combine those things together magic can happen. If you've got an email list of 100,000 people that you've built from cold advertising or from buying tripwires and now you're combining that with the power of something like Amazon.com that's really really powerful. Most physical products sellers never make that [inaudible 00:24:32.6] or they get so myopic into one channel that they never spend the money and the time to go develop the advertising for another channel. I wish I had been comfortable losing my rear end on other advertising channels until I figured out those systems. It's interesting Joe, it's true that every channel you will lose for a while and then you figure out the systems and then you start to grow through it and you get profitable. The strange thing is that most people once they've figured it out and get profitable they're unwilling to go do that hard work in another area. So the way that Amazon worked in 2013, '14, and '15 was if you spend until you grab long enough you could outrank everybody else and go win but I never … I lost that hustle when it came down to Facebook Ads or influencers and people start looking for the immediate ROI. In what business is there immediate ROI? When you're building a long term brand that has sales potential … like buyers are buying the systems; they're buying profitable systems because you've already gone through that hard work of developing the systems that are profitable. But it requires you to go build them so I wish I had spent more on advertising, been more willing to lay it on the line, rolled more back into reinvestment. So I'll call that mistake number three. Joe: So for buyers and sellers that are listening, entrepreneurs that are listening it's that one legged stool, two legged stool, three legged stool. If you're 100% Amazon business it's riskier than if you also have a revenue channel from Google Ad Words and driving traffic to your Shopify store and you might be doing wholesale or B2B things of that nature but right away as I've said before if you've got a business that's just at within $100,000 in discretionary earnings that's 100% Amazon same business $100,000 in discretionary earnings but you've got 60% Amazon, 25% Shopify, I guess that would be 15% percent [inaudible 00:26:36.4] my math here, another percent of B2B that business on the other side is going to be worth 15 to 20% more. So you might be breaking even or losing a little bit of money on that land grab trying to grab more customers but if you can turn that into even the same discretionary earnings that business automatically is going to be worth 15 to 20% more because the buyers will pay more for a risk averse business that'll be around for the longer term so very very good advice. What channel would you go to first? Because there are so many options these days and building a channel off of Amazon is hard as you know. You've got to learn a whole new expertise. Where would you go first and what do most of your successful folks do? Ryan: Yeah and I'm actually going to cue on very creatively sidestepped this question because the obvious is Amazon. But where I would suggest is actually people double down on where the audience is. To me, this is the nut has to be cracked if their building a sellable company. And what that means to me it is for some people their audience hangs out following influencers. For other people that is they follow blogs or they have a blog where the audiences are already hanging out. Or some people they've got a Facebook where there's an audience. Now what most businesses, especially like a million dollar businesses, are doing is they're going channel first and trying to extract as much of it as possible. Like I'm going to go to Amazon try to rank and pull as much out of this pie as possible. Only a few people can win that game but if you switch it and you say where are my people who is the ideal buyer and where are they then the channel where you collect the order can always change. And that makes Shopify, Amazon, B2B a whole lot easier. The first nut that you have to crack isn't where the buyers hang out apart from the sales transaction and then you bring those buyers to the transaction. So the transaction to me … Amazon, easy no question. Put your product on Amazon the credit card is already there, people are already looking for it. No question, easy, done. The nut that needs to be cracked is what happens one step before that. And if there is … like if you don't have the influence, the list, the following, the traffic, the pay-per-click strategy that some way to go get those people and bring them into your ecosystem I think you are struggling from the get go and that's the primary question that I ask the entrepreneur. Joe: Yeah and I think depending upon as you say the product and what they're offering some of those different channels will make more sense. You know I had a conversation with someone this morning that has several brands and one brand has incredible numbers with email marketing and that same expertise applied to that different brand doesn't do as well. Ryan: Right. Joe: They're driving people to their Shopify store though Amazon keeps growing and out phasing everything else. So I understand identify where your customers hang out and then you've got to go find those customers. To own that list though you need to send them to your own store, not to Amazon. So are you sort of balancing between sending them to Amazon because it's all there or? Ryan: No, I just disagree. So I think that the loyalty to the brand is the customer experience. And you give the customer the ability to give you money wherever they are most comfortable making the purchase. I heard Brian Lee say where it's … Brian Lee is the founder of the Honest Company, the billion dollar brand with Jessica Alba, and I heard him say once that he considers it a win when the product is in the customer's home. That's when you've wo, not collecting it online e-commerce site, not getting into retail. It's when the product is in the customer's home. However, they get it and you want to release as little friction as possible getting the product into the customer's home. You will own the customer experience when you have their data. You have the ability to communicate a message in front of them. So if you've got the email list and you send them over to Amazon, Amazon rewards that and your conversion rate is probably going to be higher sending them to Amazon that sending them to your Shopify store. So there's a balance [inaudible 00:31:12.7] I know that I can get a higher immediate customer value sending them to my own web site because I can put them through upsells and cross sells to get their immediate data versus sending them to Amazon where I am going to have to work to get their data. I don't have any upsell experience. They might see a negative review. And so the entrepreneur is going to have to play the game of where the numbers make the most sense over the long term. But I think that the actual customer experience happens in when you communicate with them. And that's in the email message, that's in the outside of just a transaction, not just where their credit card is being added but words being communicated. Joe: Okay, I get and I'm just going to repeat it for those that are … well not smarter than me; let's put it that way. So it's capturing the customer information up front, building that relationship with them, and then simply send them to the place that they can buy the product and experience the brand with the least amount of friction and get it in their home. Ryan: Nailed it. Joe: Okay. Ryan: That's my opinion. Joe: And it all goes back I would say and it's kind of almost unspoken that the brand has to be pretty amazing so focus on that first. Build a great product, a great brand so they have a great experience and then do all that other stuff as well. Ryan: Yeah and let me address that because that often brings up the question how do I identify a brand? Like what exactly is the brand. And the brand is the way that trust is communicated to a very specific customer. Most Amazon sellers have no idea over their customers they know what their product is. If you know what you sell and not who you sell to you do not have a brand. Or you might have a brand but it's really lousy whereas if you know who the person is, it makes the product really really easy. I was just meeting with one of my team members today; we were expressing the frustration over one of our brands in our portfolio. Because when we acquired it, it sold a lot of product but it had no target market. And so we've had to do a lot of work to convert that brand into an actual brand where people are not just buying a product but they're buying something and it says about them sells. Those businesses last, product businesses don't because they're commodities. You forget about commodities and the minute that there's a better price or better customer experience their loyalty changes. But when you've got the brand people are very stingy with their trust. I want to give it to you, you have them for as long as you keep their trust. Joe: Very important message right there. Ryan, any thoughts in terms of whether someone should be building this business and always think about the future and possible exits; do you try to instill in them that they should know the value of their business in the event they wake up some day and want to move on or do you just focus on building that brand and when you're ready the time will come? Ryan: You know the real … the temptation for me is to say that no, you shouldn't be necessarily thinking about selling but I know that I'm in a different spot than everyone who's listening. So I would say if you are building this to make money, be building it to sell from day one. Because the very act of being in it for the money means that you will burn out, you will wake up and want to do something else. It's going to happen. So if that … and like let's just be real about it, if you're in it because of the payday, build it to sell because that's what you're in it for and the payday is the cherry at the end of the rainbow here. If you were in it because you've got a product you want to bring to the world then still develop the systems and processes that will keep you in the position to be in your zone of genius. And that will make you more sellable one day but I don't think it's necessary for you to know what it's worth or be making decisions based on that. So these are different goals. Now I build companies that I'm excited about and I am building them in the same way that we make something valuable because I want to be in a position where I'm just in my zone of genius. But it's a different mindset than if I'm building something because it's going to be profitable. Does that make sense Joe? Joe: Absolutely; excellent …excellent. Hey listen I know we're running out of time here I just want to say that last summer I was at the stock market conference and you got up and you spoke as did another dozen or so very very successful entrepreneurs. Each and every one of them had a PowerPoint presentation. You got up there with nothing. And you talked for an hour and the audience was captivated as was I. You have a gift thank you for sharing it. I appreciate it. Ryan: I just got goose bumps. Thank you so much, mate. I really appreciate it. Joe: How do more people get to experience that and listen to you and hear what you do share? Ryan: You know I'd love to answer that question, can I offer one more piece of advice before we go? Joe: You can offer a dozen more pieces of advice. Ryan: Wow, awesome. I'll leave it to one but if you are in this to please have a plan of what you're going to do with the money when you get it. Entrepreneurs are magicians. We remake things up here on thin air. We create value out of thin air. We create a bigger pie. We make money show up. And we also make things disappear. Joe: Isn't that true? Ryan: And if you do not have a plan of what you're going to do with the money it will slip through your fingers. I know you think you're the exception. I know you think all I have to do is invest this at 8% and I'm [inaudible 00:37:11.5]. I know you think that's how it's going to be. You will ball the money. I … right now I just heard you think “no I won't”, yes you will. So if you don't have a net for catching the money and allocating the money for your lifestyle you will be back in the grind very very quickly. I promise you, I know you don't believe me. I'm here to tell you that's the case. Have a plan for what to do with the money once you get the money. It's actually my favorite conversation to have. At some point, I'll probably have more chops [inaudible 00:37:45.3] about investing once you have a big windfall. But for now, it's like have a plan like a plan is better than no plan. And that plan would probably be best done after you sat on the money for about six months and you've gotten used to that money being in the bank account. Your second question or actually your only question was- Joe: Can I interrupt that? Ryan: Please. Joe: I definitely want to get to that but in terms of having the plan to exit, I'm always telling people look have your next adventure planned. Because entrepreneurs like you say they blow through the money, it goes through their hands like saying. I'm often saying maybe get that other opportunity started and launched long as it's not competing to get the ball rolling. So that you got some working capital maybe you're going to put it in … some of it you're not as bootstrapped although you'll be more successful probably if you are. Do you think maybe they should 100% focus on what they're doing on that brand before they sell it up until the day they sell or maybe when it gets big enough and good enough and they've done enough right they can take some of their attention and start Brand B while they're selling off Brand A? Ryan: Wow, Joe. The reason I'm saying wow is because my experience is pretty unique and that was I took about a week off and then I immediately went back to workaholism and it was the worst. It was a horrible experience. Now full disclose like at the same time I was going through separation and I'm going through a lot life changes. I threw myself into work right after the sale. I celebrated by reading books on my patio for like eight days and I was immediately back to workaholism. And I like … I roasted my body, I mean I so needed a break and I did not give myself that break. I don't know if every entrepreneur was as burnt out as I was. I was more burnt out than I [inaudible 00:39:40.5]. Joe: Most ideal [inaudible 00:39:42.8] they come to me tired, exhausted, ready to move on. Ryan: Joe, it's been over a year. I wouldn't even say I'm back now. You know I'm probably operating at 75% of capacity because I never really recovered. So should you go right back into it? I don't know. I think it depends on the level you're at and your own wiring. I make really good decisions when I'm relaxed and creative. I make terrible short term decisions when I'm stressed. And when I'm in that workaholic mode I'm a terrible entrepreneur. I wish I had just blissed out for like three months; I didn't. Joe: I don't know what the folks that listen to you every week would do if you would disappear for three months though. Ryan: Well here's the thing though Joe. I kind of did. Like my podcast sucked for like three months, three to six months and I was trying … like I'm sitting in front of mic trying to come up with things to say and I was uncreative as heck. So I sort of did disappear it was just a different way. And now I'm getting back to it and it's a completely different experience. But I actually think I did my listeners a disservice by not taking a break. And if have been just really upfront and be like guys I just got an eight figure check I am going to the beach and I will call you when I'm ready. My audience would've popped but instead, I was like operating from this place of like I'm so … oh my goodness I'm so tired and I turned off a lot of people. I know it's not the answer that you expected it's not the answer I expected to give you. Joe: No, I like it. Ryan: But I think it's true. Joe: I think sleep and rest and meditation or whatever it is to focus on is absolutely necessary. So back to that original question and you know finding out what they do with the money after they sell. How do they get more of Ryan Daniel Moran? How do they experience what that audience down at Smart Market and myself experienced where you just talked and everybody listened and took notes and all that? Ryan: Well, thanks so much, man, my media company is capitalism.com. My podcast is called Freedom Fast Lane. And I say things into a microphone and we hold events at capitalism.com that are specifically for entrepreneurs. And we're actually … we just rebooted the Freedom Fast Lane podcast. I feel as though- Joe: With fresh energy. Ryan: What's that? Joe: With fresh energy right? Ryan: Well yeah, I think you'd probably feel it from me. Five years ago I started this journey as a boy and I was … I just put everything I owned into my car, drove to Austin, Texas, started some new companies, I documented the whole experience from startup to sale. And then I kind of grew up while documenting the journey. And now there's a new journey and it's a much bigger one and so we just rebooted kind of the entire audience, the whole experience in the podcast. And my podcast is called Freedom Fast Lane. My company is capitalism.com. Joe: Okay. Well, I'll make sure those are in the show notes. I'd love to see you be more successful on this new adventure, this bigger journey. Ryan: Thank you. Joe: Let's stay in touch. I think I may see you at the capitalism conference at the end of August; let's see. At the very least we'll be to as many as we can be over the next few years. Ryan: Good to see you man, thank you so much for having me. Joe: Thanks for your time, I appreciate it. Links: Capitalism.com FreedomFastlane.com

So the big question is this, how do you become financially free in today's world where you can do what you love doing, spend time with the ones you love and provide for your family without being chained and selling your soul to a nine to five corporate America job without having to sacrifice going out to eat so you can pay off the debt faster. The question isn't, how do you save more? The question is, how do you make more without spending more time? That is the question and this podcast as the answers. My name is Ryan Enk and this is Cash Flow Dad Life Ryan: All right. What's up everybody? This is Ryan with cashflow dad life and I'm stoked today to bring to you the cash flow Ninja of the world right now, Brian page. And the reason I call them that is because he has made over $300,000 in just six months using a huge new real estate investment strategy in the short term rental market using AIRBNB's. Brian, are you there? Brian: Yes, I am. What's going on? I've never been called the cashflow Ninja before. Okay. Ryan: No, it kind of has a nice ring to it, doesn't, it does. Just remember you heard it from me first. I might have to, might have to copyright that Brian, but so he calls the strategy the BNB formula and basically what it is is you can get started with this on a shoestring budget even with very little money because you don't have to actually own the properties. You can make. Quit your job type of money in just a few months... You can automate the business to make it passive and work on just a laptop or a cell phone for just four hours a week or less. And you could get started with no credit. Did I miss anything there? Brian: Yeah, no, it sounds too good to be true. I'll have to have to preface it because it sounds, it does sound amazing, but um, but I, I, yeah, basically what I've done is I've taught other people to do is, is pretty exciting. I'm very excited to talk about it. Ryan: And you've gotten some great results from a lot of the people that you've been teaching too. And that's kind of the premise of our podcast and our program is we want to provide people with passive income type opportunities so that they can be financially free. And that's one of the things that are really like about this is that you can kind of automate the business now. Nothing is entirely passive, but you've gotten it down to an art on how to basically minimize your time. So that is generally a passive business. Brian: Well, you want me to jump into it and kind of give the overview on what it is? Ryan: Yeah, absolutely. But real quick, how I kind of stumbled across this was a, I actually, because I'm a real estate investor, I see all these things in my facebook feed and uh, the BNB formula kind of popped up and I'm. And I thought that I was a pretty smart, right? So I bought this vacation rental property on the water in New Orleans is the $750,000 property and I got the owner to be the bank to me and he accepted $60,000 down, which is less than 10 percent. Uh, and it came fully furnished, so I just thought I was a genius and the first year I made $80,000 rental income in the short term rental market. So then I saw your thing pop up on the newsfeed on facebook and um, and so I went through, I watched the Webinar and end up getting the course and then I realized, wow, I'm a complete moron. I could have done this without putting $60,000 down. I could have just done this and you know, started cash flowing on it right away without that risk of ownership. And even if I wanted to be an owner, there's ways to do that --- This episode is sponsored by · Anchor: The easiest way to make a podcast. https://anchor.fm/app Support this podcast: https://anchor.fm/cashflow-dadlife/support

What are the different aspects needed to grow a sustainable business that is transferable and valuable? Today's episode is all about planning a successful strategic exit plan when selling your business.  Whether it be online, offline, or hybrid, how you lay the foundation for your business is the key to a smooth transaction even before you start the process of selling. We are talking with Ryan Tansom, a fellow podcaster, consultant, and successful business seller all about how he turned his sale into a springboard for helping others accomplish a great exit. Episode Highlights: How a strategic exit compare to a financial exit. Figure out how to align growth strategy with exit strategy in order to get what you want out of the deal while taking into account the financials, the company culture, and the potential legacy involved. When an offer comes to the table it is important to weigh all the variables. Think about any way that the buyer can do to add to his profitability. Show them all the things the things they can do and package it up for them. Network early and often with people who align their motives with yours. Make sure you know what the buyer's business continuity goals are. From knowing their goals you can come up with ways to fill their strategic plan. Understand the industry on both sides of the transaction so that you can design how the business can look for a strategic exit. Prepare early for the sale of a business so you don't get any nasty surprises during due diligence or negotiation. Ryan lays out the framework of a strategic sale. When strategic exits work and when they don't. Transcription Mark: Joe, how are you? Joe: I'm good, feeling old and tired but pretty good how about you? Mark: You are old and tired and I'm catching up quickly. Joe: But I'm not cold it's 63 in North Carolina today and you going to get snow this weekend right? Mark: Stop it, Stop it, by the time this episode airs it's going to be a beautiful year and I will no longer be recording episodes, I'll be outside enjoying it. Joe: Yes. I mean 36. Mark: Something like that, alright when we talks to people that want to sell their business, pretty common scenario, they're looking for a strategic exit or maybe they'll say, you know, we go to the whole valuation process and then they come back and then say “I've got a couple of companies of mine that might be really good fits to acquire the business right?” Nothing about strategic. I'm sure you get the pretty often on your side. Joe: Sure. Yes. Mark: Yeah, right. So strategic, how do you actually do them? Are they worth it? Do we actually get more money from them? That is the subject of today's interview. I sat down with Ryan Tansom. Ryan has his own podcast which we talk about a little bit, but he's got a really cool story, he and his dad were in business together in a traditional offline business. They are selling copiers and had all sorts of contracts there. And they went to the process of merging that company with another one. They first try to sell the company, and found out how difficult it was, then they spent some time retooling in and really planning their exit, and after they've retooled and planned their exit they were able to do a deal in just a few weeks. So his whole thing right now is to help people plan their exit and build value on the business at the same time, but I wanted to talk to him about how do you plan an exit if you want to do a strategic sale? Does that make sense? That you actually get more money from it and what are the chances that's going to happen? This is a fascinating conversation. Joe: Good. One thing that most people don't do, and that's plan their exit. They usually just wake up one day and decide, “I'm tired I want to sell the business I'm ready to move on, So you know I've talk to Ryan a number of times and I think He's life experience, what he went through  with his business with his father trying to sell finding, it was difficult and then actually putting a plan together and deciding, when he executed that plan and he'd sold the business very quickly and I think to a strategic buyer. He learned a lot and he's sharing that with people now. So It's nice that he's got the first hand experience in the sharing with people and I think he does a really good job at it. Mark: Yeah, and so in this we're going to talk about what do you need to do to get strategic exit setup and not surprisingly, it's a lot of the same stuff you have to do  if you're going to have a financial exit or a regular market type sale. Just take a little more upfront work and we talk about the chances of it actually happening. I also talk about how that it's not always the best thing. The very first business I sold went itself to a strategic exit. We ended going to a financial buyer because they actually got more money from it so we talk little about that as well. Well we get on into it because it's a lot good mini topics in this episode. Joe: Let's do it. Mark: Ryan, hey how are you? Ryan: Good Mark, how are you doing? Mark: Thanks for joining me. It's been a while since you and I met, well I think we're just talking about this a year and a half ago or something like at Caribou Coffee here in the Twin cities. Yeah you're local to me which I like. Ryan: I know we're local yet we're sitting here on video right? Mark: We should've done the very first podcast with [inaudible 0:03:58] and where he would have be like saddled up right next to me. Alright cool, well on our podcast we like to better a guest introduce him selves, probably because we're really lazy and don't like to do the upfront research but also because guest  do a better job at introducing themselves. So could you introduce yourself a little bit to our listeners? What is your story, what's your background and why are we talking. Ryan: Yeah, I appreciate it, I'm glad to be on the show I'm usually the one doing the interviewing so this is actually a lot of fun. So Ryan Tansom, my Dad and I had a family business kind of a little bit of backdrop back in 2014 we end up selling it. He grew it from the ground up, bought a semi [inaudible 0:04:32] of copiers in the mid 90's and ended up growing a very substantial business that I think we've topped for about 20 million and a hundred employees, and I joined the firm full time in financial crisis, and it was pretty much lot of all hands on deck for the seven years I was there. It was.. We realized that company was not sellable  because there's a private equity firm that was buying out platform companies in each marketplace, and we have the opportunity of potential to be one of those, and they passed on us so we spent pretty much in next 6 years, 7 years going. Okay what do we need to do to build a sellable business that either I buy it or we sell it to someone else we didn't really know what were options so we just roll up our sleeves and did a bunch of stuff. Build out the outsource, the IT. Remarketed ourselves, did a bunch of stuff, and then in 2014 ended up selling it to a local competitor here which the sale went very well financially, but we left a lot of money in the table from a lack of tax planning and some other deal structure that things we could done creatively, and then also we found out a strategic sale like that that there's a lot of redundancies, so I ended up having to fire a lot of my good friends, and family and the employees, so since then I've been in a mission to figure out how do you align your grow strategy with your exit strategies so that you will get what you want, regardless whether it's financial or you know, anything associated with your business that you know, whether it's legacy or culture, and stuff like that. Hopefully I sent too much but it's definitely the backdrop of why I'm doing what I'm doing. Mark: Alright so there's a lot that we can unpack here and we're going to have try to pick a branch and go with it, because I think there's a lot that we can unpack here. Business that you and your dad sold, this is more of a traditional offline business right? copier sales? Ryan: Yeah, where on we have15 sales representatives that were knocking on the doors and I wish we would have done something that would have been a hybrid, and we would have probably gone that direction, had we, continue grow on the business, but I think, you know, every offline businesses, which is what we were, has the opportunity to have the hybrid online stuff that a lot of that community that you're involved and I'm involved you know. Mark: Yeah, I think a lot of the online community is moving towards this more traditional business model, at least in the E-Com Space and you've seen it all. So in the and largest as company, because they do develop our staffs and in onboarding, customer service and all that. So similar to your stuff.. So I guess, let's talk first about the fact that you left money on the table, with your.. You spent six years trying to hammer the business industry, I think there's a discussion in there on it's own, like, how do you line your crawl strategies and your business strategies with an extra strategy, but I like to know a little more about the money on the table. A lot of times when we say people leave money on the table, that's because they have maximized the sale price of their business, but were there other areas where you've guys felt that you left money on the table? Ryan: You know, I think yeah, there's a lot of different variables in this, and you know, I've got a Podcast too. I've interviewed lots of entrepreneurs that have soul and I've tried to unpack this exact topic as well and there's the “Hey there's a price so I might want to give you 2 million dollars for your business” it doesn't mean that you're getting 2 million bucks because you're paying taxes, so there's the whole deal structure whether it's asset sales or stock sales, or how the deal structured from earn outs, from an SBA loan financing, whatever it is, you know, when someone starts courting you, whatever dollar amount is thrown out, there's a lot after the fact than what actually comes in your bank account. So whether that's a tax planning, the deal structure, you know, escrow all that kind of stuff, and then there's the maximize the value of the business, so there's kind of, two different key components to it. Mark: Yeah and I think, just by way of example, within online businesses, say that your [inaudible 0:08:10] corp, and somebody wants to buy your business for 5 million dollars. Great, and they're getting an SBA loan and everything looks good, but then you get to it and at the end of your purchase agreement there's this asset allocation agreement that's to how is this been allocated tax wise, and the buyer says “Well, we want to pay, out of 5 million, we want 1 million to be your salary for the next 2 years for consulting, that's part of the purchase price” well now that comes at ordinary income tax, cruise up your whole tax, percent tax situation.. Ryan: Because you know [inaudible 0:08:41]? Mark: Yeah, how much are you getting from that point, and you're from, for buyers trying to relegate towards income, makes sense because they can learn it off in a way, because they were going towards assets, it's a long period of times that they can make that of. So, there's a lot of, like you said there's a lot more complexities there, in terms of the deal structure. So let's talk about maximizing the value, the dollar amount. Did you feel like you guys left some money on the table with that? Ryan: No, actually we did as much as we could of, because our business naturally.. I got it appearing to what is the, honestly the best kind of business because we had contracts, that were locked in with reoccurring revenue, backed by bank financing, we've bundled them with maintenance, so like, if you want to buy, manage IT services with.. You know, bundle them with servers, firewalls, maintenance, copiers. I mean you'd be bundled in finances and then, it'll be 60 months typically and it'll be in.. It's as good as a mortgage, so when you're looking at what we did and what our industry.. It wasn't something that we were like geniuses or anything, either the whole industry, I've been gone that way and I think the whole industry was built of greedy sales people. In reality it was good as mortgages because you can't cancel. So, it didn't really matter when you think about a strategic sale like that, the relationships of the sales people, the admin, all the infrastructure was redundant. Because we can literally just take a bunch of paperwork and give it to someone else. And so what you're mitigating less on the sale on like the, EBITDA, multiples, because the cash flow is not the situation, it is your Han dinging over contracts. So I don't think there's anything we could have particularly done on that aspect to maximize the sale of the business, but the industry itself taught me, what, “we got lucky, is pretty much what it came to” versus “we could always use other business, where it might be, a 50 million dollar consulting company and there's nothing to sell besides a bunch of people”. So, I realized, after the facts that we got lucky and there's a lot of other ways to maximize the value of the business from the strategic operational side of it. And then it comes down to, we sold a couple of branches prior to selling the corporate headquarters, so the first time we sold our branch we got  about half the price because we didn't have preliminary due diligence done, they didn't trust us, we couldn't get the right documents and all these different things so there was technical stuff on that aspect that we, by that time we ended up selling, we knew what questions are coming at us and why. Mark: How did that impact the price the second time around? Ryan: Second time around when we ended up settled…  I mean we closed in 2 weeks. Mark: I know how. Ryan: Very substantial sale so average closing is, either we talk in months and months and months, either because, we came there with a package and said this is exactly what we have, here's our profitability, here's where every single dime goes in and out of the business, here's why, here's our, I mean employee contracts, customer contracts, lender contracts. I mean everything was just ready, versus the first time and we knew it was like, we're bumbling idiots. Didn't have any clue what they're asking and why. Mark: Yeah, we've created a very simple paradigm at Quiet Light Brokerage that we call the 4 pillars of value and that is, look at the risk of your business, the growth opportunities, how transferable it is and the last one would be in documentation. Now I think sometimes people take that documentation that light as to.. Well, it may not really make that much of a difference on the value of the business, it's just going to make it easier, actually makes a difference in the value of the business too. Ryan: 100% yup, I got people that I know, that I've interviewed and talked to, where their value actually went up by 30% because.. But with a click of a button, especially by drop box these days and software where you can, “Hey here's everything” A – you can get more buyers at the table quickly, if you can do that instead of having threads through all these documents, but, you end up as the seller end up guiding the process more than the buyers. Because in the marketplace 90.. No, plus % the time the buyers are coming in there and they're going to find every reason to discount that companies so they can  make in return.   Mark: Right! and on top of that it's risk right? So a buyer takes a little good in business with poor documentation, and they don't know what they don't know. And so they see that as being risky and they will discount an account for that risk as well on the purchase price, and you don't have your stuff together, you can't defend against it. Alright let's talk about strategic sales. Because you guys did a strategic sales and this is something that I find a lot of questions on. First let's talk about what was the difference between a strategic and a marketplace sale in your realm. Ryan: So it's my world it's every world right? So a strategic sale realm, let's start with the financial sale. The financial sale whether it's an ecommerce business or if it's a traditional business or whatever it is, someone's looking for a cash flow. What's transferable cash flow? So if I want to buy Quiet Light, if you guys are dropping a half a million bucks to the bottom line or whatever it is, I want to.. How transferable is that? So that's where the multiple EBITDA comes from. So, if I can buy that chas flow without having any risk that it's going to decline, and you apply a multiple which is how many years, what's my rate of return that I want,  3 years, 5 years, whatever it is, and the more transferable that is the higher the multiple goes up. So, I mean someone that's looking for cash flow as a lifestyle buyer, a private equity buyer, I would say that there's also strategic financial buyers which is someone that understands MNH extremely well and knows how to do this, that's kind of like a hybrid. So they're looking for cash flow and they're applying a rate of return based on the risk of the business and the asset. Then you and this strategic sale which I think is one of the funniest ones because every business owner, every entrepreneur that I sit down in front of, or I talk to, you know your business, you're intrigued better than anybody else out there, right? So you know who you'd partner with, where they collaborations with you, all these different things, and I don't want to say the multiples even they go out the window, but it's more of how fast, in terms of, if thinking of rate of return from 3 years to 5 years, or wherever the buying might be, and the rate of return is, how fast can we pay for that? So regardless of the EBITDA, now you're saying “okay well, are there complimentary products and services? Is there a cross pollination between customer list” Is there horizontal ways, there are vertical ways you guys can expand, and if you can think about everything in the terms of the buyer, the strategic buyer and what they would do with your business, you can literally model it out for them, how fast they can pay you for your company. Mark: Yeah, so this is great. I want to talk about this because we get this question, wow goodness, probably one out of every four or five people that contact us to sell. One of the very first things that they say is “Well I have a few companies of mine that might be a good fit for us” and they're thinking it in terms of that like strategic sale, they think it's going to be much more valuable to them and there is some truth to this the webhosting industry it's a classic example, webhosting, at the very first I sold working with Quiet Light Brokerage, first started Quiet Light Brokerage was a webhosting company, and webhosting company has a tons of roles because it has a bunch of user accounts that is on our servers and it's very easy to migrate that user accounts over to another server, keep the packages the same as really just paste and transfer it **** sometime **** and a monthly contract so it's really really easy without transfer overall stuffs, so like you said all of the expense profile of those companies you do really care about that because if I me acquiring a company I already have those expense profiles. I know what to cost me to host for 500 clients, so it will become a client count. Now when you're talking about strategic sale, like I said, there is not only to redundancies which you dea'lt with, first hand, it sound like,  in your sale redundancies where you have multiple sales people doing the same thing so you a lots of people go, but there is also the synergies of my crop up with one company that is a name in an industry right? Ryan: Right! And there's [inaudible 0:16:28]for us, it was, that we didn't sell telecom. It was the one thing in outsource, the IT in office technology that we didn't do, since okay, we got, you know, 2 or 3 thousand accounts, how many people can you sell telecom to? A lot, probably. So that is not guarantee in profit that they're going to make, but it makes a deal look better, you know, then you can make some basic assumptions or something like that, and then you know, cash or order discount on suppliers. We weren't taking advantage of that. So we start to think about any way. Going to that buyer and saying, here's all of the things that you can literally get packaging up for them, and you know, I think there's some people that you and I know in Rhodium, and why see that, the reason that they start on their family to start in the retail, wedding industry, they got online… well, weddings usually don't have repeat customers, you know there are couple every now and then.   Mark: Hopefully not.   Ryan: I usually do subscription services so, what are different ways that they can expand their products and services, because they have a crazy amount of volume that come through their doors every single year. Because they got a very good foothold in Minnesota here, but so it's their robes, it's their jewelry, it's there. Other things that they can sell them and they know the volume of their customers, so you know, yeah there's the sale or the purchase price and the profit but they're more looking at do I build it or I buy it? So they know how long it's going to take the opportunity cost of how long it's going to take to build it, screwing things up, all that kind of stuff. Mark: Right, alright so let's talk about how you would.. Let's say, we have a listener out there, they own a business and they're thinking, “I've really like a strategic sale just because my business is unique enough I think there will be enough benefit for maybe 3 or 4 companies that are sort of [inaudible 0:18:03]my industry. How would they want to go about preparing their business and thinking about that exit, a potential strategic sale. Ryan: That is a good question and I think you know this whole conundrum of exit planning and grow planning.. I believe that if entrepreneurs are running the business the way that they should and working on the business not in the business, and treating their business like an actual investment, then it is like, where are all the different options that I can sell to whenever and how fast can I [inaudible 0:18:29] so it's being ready no matter what. If you are in love and addicted to a girl then you're having a blast, great! But always be ready for industries that change, Google changes their algorithm, Facebook gets kind of a little bit a heat like they are right now, always preparing yourselves so that, the first and foremost is the due diligence, your docs, and knowing, and really cleaning up your financials because, if you can answer any kind of questions that even your friend would ask, the buyer is gone just, completely slam you down. So getting your house in order, the financials, and the due diligence is one thing, but then, thinking about, “Okay so these are going to be.. These five companies are companies that i can eventually sell to” Who are they and what, why and how will your decisions in the business affect where you're going. So for example if one of the companies is running and you know, he is an Amazon merchant or something or someone is running on Shopify, don't go build out a Magento, you know, spend 300 grand in Magento if someone that you're going to sell it to is doing Shopify. I mean, that's the same thing that we did. We spent 300 grand on an ERP's because 85% of the people on our industry had it. That's why we could close in 2 weeks. Knowing how you are spending the money and why in relationship to where you're going to sell, and again, so if you think about, if your service has complimentary service to just someone else. Don't go spent a bunch of money building out something that they have. Because you are not going to get a return so you're going to spend, your immediate cash flow, but then you're not going to get the attitude because they don't seem [inaudible 0:19:58] I think it's aligning where want to go and why and then also that strategic decisions that you are doing in between there. Mark: Yeah, alright I want actually bring a really basic level here, because the thing is important point to make special more talking about strategic sales. I think people get with the financial market sale where you take a look at the profitability of the company and you have Joe blow buyer come in who really isn't related to the industry. We all know that he wants to get return on that investment after 3 or 4 years, you'd see that investment come back in so it's pretty easy to apply a multiple. Sometimes when we're talking about strategic sales people come and go crazy and they start thinking, well, look at all the upside potential that is going to come about from this and so they start lowering their valuation expectations through the roof because sometimes strategic do get really high relative valuations of this realm to the financials, that said, I'm going to make a very basic statement here and I'm sure you'd agree. Strategic still need to see an ROI, right? They still need to see a return of investment. Yeah so, what you're saying is when you're building out your company, when you're really planning that exit and working on the company, think about the ROI that the potential buyer is going to have and don't build something that's going to super expensive for them to migrate it over, right? Ryan: Right and it's like, so how we went about it is, I want to know this business, I want to know why they should buy this business more than anybody else. So like, I want to know everything about their business, I want to know exactly what their marketing strategy is, what their profitability strategy is, I want to know their strategy just as well as they do, whether you can or not. Because then you can show exactly how you fill their strategic plan, based on what they're buying. Mark: Right, so let's talk about modeling a little bit. When you're talking about strategic sale in your case with your dad in your business, [inaudible 0:21:41] done in season staff and so, when you're looking at presenting the financial picture to potential acquiring company, how did you go about that? How did you pitch it as far as the ROI? Ryan: So, I had like literally our entire.. I mean we have cash list statement and we learned a lot first time, right? So I knew every single penny that went in our business and why, so we did some serious cash flow modeling so we had our whole P&L, and then we had the forecast of what was going on to the sales and the cost of goods, our profitability, and I hacked a bunch of stuff through it, and I said okay, and I buy GL code Mark.. Mark: Wow Ryan: We did a.. Yeah, I know. Because there's the, in the financial buy, there's the add backs, right? So, a hundred grand might be 300 grand on the value, whether it's being added to the value or not. So, usually in the financial buys, you want to take that off to increase your EBITDA, so that way it's applied to the multiple. But in this system the same thing were [inaudible 0:22:41] you don't need these people, you don't need these servers, you don't need these things because you already have them. So, that is all dropping to the bottom line which will then help them calculate the ROI's so, we just looked on them and say okay, here's how much of the expenses you can take out of this, with these assumptions and then move back and forth, you said, what we actually need these people, we need these things, and then you're just negotiating back and forth but it was not more in the add backs, it's more of understanding the redundancies and the strategic value behind this. So it's a similar exercise but, you know, and now comes actually kind of the same but it's more specifically to operations. Mark: Well on the key pieces I think, needs to be understood is you need to understand the industry and the business itself. We work for the financial, forex leads site, this was several years ago. And they were getting lots of leads that they were selling and they wanted to arrange a strategic sale to a forex broker. Because they knew that they were jittering these leads and so that the equation really became okay. We know how much we're getting paid out on their [inaudible 0:23:43] basis for these leads. But as a forex broker, here's where the dollar amount for the valid leads are, and now we can start modeling our what does this look like, how much revenue is this site really making, from a forex broker's standpoint and then the other value proposition there. Ryan: Yeah it's literally of about knowing both of the businesses and the industry as well as you possibly can. So you can just design exactly how it looks. And then you backing up numbers, you know, I'm just kind of making some other things up but like, you and I have talked and I think that was when you were on my show, we're talking about the hybrid of the online versus offline and so, if someone has literally the best data ever on their drip marketing, their automation in their online marketing and knows exactly the entire cost of acquisition of one wheel, and whether it's Facebook ads or Google ads, all of what the email mark and you say “here's how much all this stuff cost,” they can go in and if you're going to [inaudible 0:24:38] and sink that up with an offline business, like there's some huge power there because you know that they're not doing that potentially. So you can, there's just so many different ways to design that I guess. That's kind of the fun part. Mark: Yeah and the nice thing about strategic is that there's really, you have the ability to blow a traditional valuation out of the water, right? That's one of the big advantages. Transitions can also be a little bit easier because they already know the industry and so you don't run saying “here's how you do this little process that you should probably know anyways” it's a little easier to transition. When I talk to people about doing strategic, so I often tell them that I don't think it's a good idea for them. And the reason I say that is mainly because they're difficult to do if you haven't been preparing. How long do you think it takes to really prepare business for a strategic? Ryan: So I think maybe I'll go back with remarkable steps which is what's the order of operations I think you should do to do this correctly, right? So kind of the assumptions to repeat is beat your foundation setup, build your financials, build healthy business from recurring revenue, the clarity of all these different things, making sure you don't have a bunch of concentration in one client, all the typical ways of de-risking your business and if you're striving to make a healthy business like that then you'll have lots of options. So at the bare minimum, you should be able to sell to a financial buyer, so then called to 3 to 5 times multiple EBITDA. So you know that, financially going okay, if it's 200 grand, I know that I'm going to be getting 600 or a million. Whenever it might be, right? So I know that's how or that's my target. But with a strategic sale, you could completely blow it out of the water, but that's kind of like hunting. It's hunting for unicorns or really specific synergies so you mention 5 people, that's fantastic but, what if they don't want it? What if they're struggling? What if they don't have the money? Don't have the ability to get banked? All those different things. Those are things that you don't know and yes you should work towards them so I think, to answer your question, I don't know but really helps with that, it's like, we knew our buyer. Like  half of our employees has hog back and forth, you know, we're in the same industry trade associations so, I actually had taught the woman I interviewed yesterday at my show, she would have spent 2-3 years building and fostering those relationships, so those people could have been at the table. She didn't do that, so this is more of a relationship building, going in Rhodium Weekend, going to the YC Events, going to [inaudible 0:27:00] all these different things where people build relationships. And then what ends up happening is, I [inaudible 0:27:06] the bar over a napkin, and then you're back in the stuff. Mark: Yeah absolutely, that's actually normal when I [inaudible 0:27:13] people that want to do strategic is, if you want to know strategic, 2 or 3 years down the road, contact the companies now and don't say “Hey I want to sell to you” just contact and do that real networking stuff and get out there. Once they've become aware of your company, and you start to learn each other's companies, then you can sort of see that conversation for down the road. Ryan: And then you get out on their radar, right? Because you're not on their radar otherwise. So, there was actually a really interesting story that I heard Mark from one of the guys I interviewed in my Podcast, where he was at a trade association, he started talking one of the base competitors and he goes “Why don't you buy me?” and that's how he started and they started, you know, BS and then it went around and then the guy has said “You know what? Let's have a [inaudible 0:28:00] every 6 months call to see how you're doing” and these people literally told him exactly what to do, so they could buy him. Mark: That's great. Ryan: That was super unique, right? His name is Norm Brodsky, he wrote Street Smarts and he was a part of the small giants book, so he's on the cover of [inaudible 0:28:16] and a lot of exposure but like, I think the concept is very unique, because if you wanted to buy my business, why don't you just keep telling me what to do, and if everything works, I mean, like I said it's kind of a shooting for the starts, but I mean, you got really nothing to lose at that point especially if you don't need to sell. Mark: Yeah alright. So you said a couple of things a while ago, I think is a good foundation I have and this is a general advise, and feel free to disagree with it if you disagree with any of the advice that I typically give people and respect them on this. With strategic, yeah you can get the out of the water valuation sometimes. But it all starts with first making their business safe, financially viable business and in someone that you can sell in a financial market. You are dealing few buyers, this is probably the biggest obstacle to a strategic sale, you might have half  a dozen companies that can potentially acquire a business and the sake people make is they went in and say “I want to sell my business” then they called ABC company and ABC company's saying “Yeah we don't have a million dollars” or “You were not in our annual budget this year” or “Acquisitions were not in our plan for this year”. Ryan: Right, I'd pause you there for a second. They may have the money, but like, everybody's busy, right? So what if they're developing their own software or doing something else, they might just not have the physical time to integrate the two companies. Mark: Right. Yeah absolutely. So you need to have that relationship in place and it has to make sense as being a natural evolution. Kind of like a marriage, right? I mean.. Ryan: Yeah, totally. I mean, you're partnering up with someone. Mark: Yeah, and last thing I would say is, take a look to see if actually does make sense. That first company that is sold, in the webhosting space, I could've sold that very easily in a strategic sale, because there was so many strategic happening, we did a financial sale because we knew we're going to get more money. So, where you can often blow the top of the valuation with this strategic, it doesn't always happen that way. Sometimes financial actually does work a little bit better. Kind of a weird, odd case. Ryan: Sorry you're.. Mark: No, go ahead please. Ryan: I think the one thing to that people really need to think about, because you might blow the valuation off the charts, but I tell you what Mark, the reason why I do what I do now is because we got the financial target that we wanted to hit, I literally had to fire 60 of my friends and family. So if your culture in your employees and the clients.. You have to understand what's important here because in a strategic sale redundancies are huge. So, how will you stomached that afterwards? Like going and calling all of our employees in, they was way at 85 or something like that at that time and they only kept [inaudible 0:30:47] I mean like, that's literally the stomached ache. Are you going to be proud and happy about what you build? Is it just a financial target that's fine and you have people dispersed across the US and there's a lot of VA's and you're not orally loyal to them or if there's people that you care about, like they are role playing that strategic sale I think is extremely important so you can calibrate against all your options. Mark: That's a really, really good point. So what do you do now? What are you doing these days? after the sale, of course. Ryan: So other than being in the Podcast just like yourself, so, we have a company called GEXP Collaborative, so, it's Growth and Exit Planning collaborative, that's what it's stands for, and it took a lot of time, over the last for years.. Exit planning I think there's some negative [inaudible 0:31:33] to it because you might not want to sell right now, but it's literally both having a good business. So we combined the two which is growth and extra planning because it's like, we're talking about what are your plans and then how do you back in to all your strategic plans, they sell where you're trying to go with you options and I found some amazing people in the industry that have different disciplines because you got legal, finance, the front insurance, deal structures, you have the business brokers, you got all these people, and they all play a roll, and how do you back into that plan? So, if you kind of think, we're almost like a building, If you start a building you start with the budget and a blueprint, because you can't build a building without either of those, so the budget is your financial targets, where you want to go and why, so is there debt, net, the amount that you need or cash [inaudible 0:32:22] and what's the blueprint. So what are the five different strategic buyers and then you got the six financial purchase, timing, role, responsibility, and you're back and do it, so you can then hire the team [inaudible 0:32:34] so the growth next to planning that we do with the collaborative team is literally building the budget and a blueprint, and then actually coordinating the team like a general contractor because no one person can do all this stuff. I've been doing it non-stop day and day of four years, and I still couldn't single hand lay out to someone. Mark: Yeah, there's a lot involved with that.. now if somebody is listening to this, one of the misconception running to all the time, with clients that come to us and say I want to sell, I'm not really ready because I did not plan ahead maybe should've talked to somebody 2 or 3 years ago. We try to get people to talk to us, the brokers, a few years in advance. For you, you're focusing again on that growth as well so even if somebody isn't ever planning to sell, it still makes sense to talk about that growth. Ryan: Because the reality is you're going to do the best of your business at some point. I mean, there's people, like I work within this, the baby boomers, well they're going to die in your business but then what you're doing is you're working on the shares and the estate planning and dispersing the shares to employees, and to kids, and do trust, so he's going to sell his company, and you know what, he loves it, great! But then there's, build a business that has value and has cash flow and you de-risks then you can literally do whatever you want whenever you want. So yeah you're right it's coming ahead of time but then also knowing the people like you and building these relationships, you can't do this at the last second, you're going to leave money on the table, you're not going to be as happy with terms and conditions and so many times Mark, and I don't know if you see this, but a lot of people that are out there, and the people that are in aggressive growth path, they're all acquiring company so the out of the blue offers happen all the time. So whether it's PE firms or funds or other strategic buyers, and how do you know what to weigh that against if you don't have a plan? So you don't even know like how much I'm going to get? What terms? I mean, you're thinking on the fly and that usually doesn't go as well..   Mark: Right! The number of time I've heard from clients, get in to this process and say, “Man, I really wish I've contacted you a year ago” I mean it happens all the time, no one ever thinks about selling their business until they actually want to sell their business and I think what's really cool about what you're doing is you're focusing again not just the exit, you're focusing on growth. Because a good growth strategy is a good exit strategy they often go hand in hand. Ryan: You're back can do it. You know, I just have a little plug for you guys too, because we do not do what you do, and I think a lot of entrepreneurs, they really think, because they understand their business so well that they can sell their business by themselves, and “Oh my gosh” it's the first time you're going to do it and why.. Like every one of those professional should pay for themselves, it should be your return of investment, what to spend, because you know it's an emotional roller coaster first of all and it's like a 24/7 fire drill while you are in the process which is what your team does, right? so I think all the people, if you have the right advisors, and that's another reason left a lot of money on the table, is you need to have the right advisers. I mean it wasn't people that do it all they want, they do transactions, they understand the market, your industry, and so having the right team is crazy important. Mark: Yeah, alright could you plug as well if anyone listen to this and enjoys the Quiet Light podcasts, and hopefully you do if you've listened this long, Ryan's Podcast talks a lot about the same stuff, you talk a lot about selling, you talked to a lot of entrepreneur's who has sold their businesses before, and you go over a lot of the same material, but with a little bit of a difference spinned to it, really, really high quality content and another one, what was name of the Podcast where can they find it? Ryan: “Life after Business” Mark: Life after Business. Awesome! So we will link to it in the show notes on our Podcast page, we'll also link over the Ryan's website, and Ryan, anything else that you want us to link or to want to draw attention to, please feel free. Ryan: We got a resources tab just like you, you're my model right? So I guess I said year and a half ago, you put me in the right direction with the presence that I wanted online, so we got white papers, and resources and Podcasts and all that kind of stuff so. Mark: Awesome, so definitely check at his site and feel free to reach out to him, if you just want to talk, he's a good guy to talk to. You know I can talk all day about this stuff and someday we probably will. Thanks for coming I really appreciate it. Ryan: Yeah, had a blast Mark, Thanks! Mark: Alright. Links and Resources: www.gexpcollaborative.com Ryan's website Life after Business Podcast Ryan's podcast link

Ryan Johnson, Head Copywriter at IWT (short for I Will Teach, Ramit Sethi’s company) steps up to the microphone with Kira and Rob for the 53rd episode of The Copywriter Club Podcast. This interview covers a lot of ground, including: •  how after a grueling interview in his car, Ryan failed to get a job with IWT only to get hired a few months later (never give up) •  how to get inside the head of your client so you can speak with his or her voice •  his process for laying out all the moving pieces of a launch, and •  how he maps emotions to his launch plans so customers can’t wait to respond •  the 7 deadly email funnel sins •  two reasons to use long-form sales pages •  the “leap stacking” technique he uses to help his writers uplevel their skill (and what doesn’t work when trying to improve) Plus Ryan shares the “copy levers” that Gary Bencivenga used to get better at his craft, how he avoids writer’s block, and the one thing he would do if he had to start his career all over. Lots of good stuff packed into this episode. To hear it, click the play button below, or scroll down for a full transcript. The people and stuff we mentioned on the show: Sponsor: AirStory Ramit Sethi The Briefcase Technique Jay Abraham IWT AIDA Gary Bencivenga Abbey Woodcock Justin Blackman The Headline Project Kira’s website Rob’s website The Copywriter Club Facebook Group Intro: Content (for now) Outro: Gravity Full Transcript: The Copywriter Club Podcast is sponsored by Airstory, the writing platform for professional writers who want to get more done in half the time. Learn more at Airstory.co/club. Rob: What if you could hang out with seriously talented copywriters and other experts, ask them about their successes and failures, their work processes and their habits, and then steal an idea or two to inspire your own work? That’s what Kira and I do every week at The Copywriter Club Podcast. Kira: You’re invited to join the club for episode 53 as we chat with in house copywriter, Ryan Johnson, about he became a copywriter and landed a job writing for Ramit Sethi, how he tackles a massive launch, capturing the voice of your client, and how long it takes him to write a 50 plus page sales letter. Ryan, welcome. Rob: Yes, welcome Ryan. Ryan: Thank you for having me. Glad to be here. Kira: Yeah, it’s great to have your here, and I think a great place to start is just with your story of how did you end up becoming a copywriter? Ryan: It was kind of a circular process to copywriting. I didn’t even know what copywriting was at the very beginning. My original interests were in film and creative writing, which led me into a delightful career waiting tables. After a few years of that, my first real job was in instructional design, and I was editing textbooks, and building training programs. I actually ended up designing an associates degree in business. I packaged and edited textbooks on business, and economics, and entrepreneurship before I realized that doing that was with no experience was totally crazy. But it was a good baseline. But while I was doing this, I can still remember. I was in the middle of editing this 500 page textbook on economics, which is about as exciting as it sounds, and my wife was working as a creative copywriter, and she was getting paid much, much more than me to edit this glossy one page ad. It looked like so much fun and so much easier than what I was doing. I’m like, “I’m doing something wrong, ‘cause there’s clearly a cap on where I am, and there’s no clap over here.” So shortly after I figured out how I could transition into marketing, into copywriting. It’s been a race every since. Rob: You’re working as an in house copywriter, but what does that look like today? What is the day to day ... How do you spend your time? What are you working on? Those kinds of things. Ryan: Yeah, so with Ramit at IWT / Growth Lab, I am the head of the sales team and the editorial tea...

What do you think about investing in property in the US? Is it better than investing in Australia and how should you think about it? Ryan: All right, Lucas has another question. He’s saying “Have you guys bought property internationally?” Ben: No, I haven’t. Ryan: Yeah, neither have I. What I want to say about […] The post What Do You Think About Investing In The US? appeared first on On Property.

My guest this week is professional audio engineer Ryan Monette. Ryan graduated from Berklee College of Music with a degree in Music Production & Engineering. For the last 4.5 years he's been the Post-Production Audio Engineer on staff at Elevation Church, in Charlotte, NC, where he mixes their global TV show, and has many other responsibilities (boom operator, field recorder, sound designer, audio editor, etc.). You may have heard some of his work, as he sound-designed and mixed the opener video for the Circles conference for the past two years. He even had his own podcast for a short while (TheQueuecast.com). I asked Ryan to come on the show to share his journey towards becoming a professional audio engineer (a job that I've always wanted), and to get him to share some tips for anyone interested in working in audio/video professionally. Highlights, Takeaways & Quick Wins: Think long term and dream big. If you want to do anything with audio, start by getting a cheap USB microphone. Take advantage of free online courses to learn more about audio engineering. Get started with whatever you have. Your mix may sound completely different in a different environment, so listen with different headphones/speakers in different locations. Master the basics and keep going back to them. If you're mixing a podcast, make sure your levels are consistent. When mixing, always use a reference track. Show Notes Aaron: You graduated from Berklee College of Music with a degree in music production and engineering. For the last five years, you've been the post production audio engineer for Elevation Church in Charlotte, North Carolina. You have a lot of jobs there: boom operator, field recorder, sound designer, audio editor, and you mix their global TV show. Do you mix that live? Ryan: Not necessarily. We can get into that later. There's a process for that. Aaron: Some of the creative people here might have heard of some of your work. You sound designed and mixed the opening videos for the past two years of Circles Conference, which I was at. Have you been there for the past two years? Ryan: I haven't been personally, no. I have wanted to go. I love it from afar, and I want to go in person. Aaron: I wanted you to come on this show because when I first got started, I had dreams of being a professional audio engineer. I thought, “How cool would it be to work in audio and get paid for it? That'd be awesome!” I fell backwards into it by doing podcast editing as a hobby first, then for money, then I met Sean McCabe and ended up working for him full time. I edit podcasts and help out with a ton of other stuff. I asked you to come on the show to share your advice for anyone who's interested in working in audio/video professionally, and to talk about how you got there yourself. So tell me a little bit about how you got into audio. When did you first realize that this was something you wanted to do? Ryan's Journey to Becoming a Professional Audio Engineer Ryan: I love listening to your podcast, Aaron, and what I love about it is I feel like you and I have a lot of similarities in our backgrounds. You're a musician, a drummer, and I'm also a musician. I play several things. My primary instrument is bass, but along with that, I started on piano. I picked up bass, and with the bass I picked up guitar. I took some drum lessons here and there as well. I sing as well. I dabbled in a little bit of everything. I'm kind of a jack of all trades, master of none. I'm okay at a lot of things, but I'm not superb at one thing. Anyway, right around junior high or high school, I started playing the bass. I started playing in little bands here and there. When it came time for college, I had no clue what I wanted to do. All I knew was that I loved music. Aaron: Same here! Ryan: I was living in Las Vegas at the time, so I decided, well, everyone has to have that college experience, and I didn't want to go to college in the same city, so I decided that I needed that “being away from home” experience. I went to the University of Nevada, Reno. I took your basic, general classes, not knowing what I wanted to do. At this time, for my high school graduation, I had received a graduation present of a Macbook Pro. With that, of course, you get the wonderful iLife suite, including Garageband. As a musician, a whole new world was opened up to me. When I was in a band in high school, I was the gear head—I loved the PA and putting cables together. I was drawn to that. Once I had this Macbook Pro with Garageband and I had my bass and my guitar in my dorm, I was like, “I can create music!” I figured out how to work it and record myself. I bought a USB microphone, and that world was opened up. When I was there, I had a friend, and her brother went to this school where all they learned about was music. I was like, “Wait, you can do that? You can go to school for just music?” That's how I found out about Berklee School of Music. I applied, and you have to audition as well. I applied and auditioned, and the first time I tried, I actually didn't get into the music school I wanted to go to. Aaron: This sparks something in my mind. I feel like I might have read an article about Berklee or looked into it and thought, “No, they're really strict on who they accept, based on your performance.” That was intimidating to me at the time, because I never felt like I was that good of a drummer. Ryan: It was intimidating for me, too. Clearly, I wasn't up to par. Aaron: Yet you went for it. That's more than a lot of people would do. Ryan: Yeah. After I finished my first year at UNR, I moved back to Vegas and went to UNLV, the University of Nevada Las Vegas. I took all music classes, forgetting the general ed stuff you need to get a degree. I took all music classes—music theory, because I had never had actual music theory classes, so I thought I needed that. With that, there were some audio classes that I took as well. I was like, “Hey, I like this audio thing.” At the University of Nevada Las Vegas, I had my first exposure to a formal audio class, where I learned all the proper techniques. Later on that year, I applied and auditioned again for Berklee. I got accepted, and the next year, I moved to Boston and went to Berklee for about three and a half years. Then I graduated. When I went to Berklee, the only thing that drew me as a major was Music Production and Engineering. I naturally loved the gear side of things. I fell in love with recording. I was like, “This is what I want to do.” Aaron: You got to spend three and a half years there, studying and learning? Ryan: It is non-stop, 24/7, music, audio, and to be honest, I miss being in that environment so much. Aaron: That sounds fantastic. I always love setting aside time to take online classes, read books, and listen to interviews about audio. Think Long-Term Aaron: You were drawn to the audio engineering stuff, and then you graduated. Ryan: I can remember a specific time in my life, and I'm pretty sure it was my last semester at Berklee. They went by semesters instead of years. It was in one of my capstone classes. Our instructor asked us the typical, “Where do you see yourself in five years?” question. Aaron: I love that question now. I hated it when I was 22. ** Think long term and dream big** Aaron: Plan out where you want to be, because if you can envision it, then you can figure out how to get there. But you have to start by saying, “I want to do this thing someday.” For me, it was, “I want to do work from a laptop. How do I get there?” Now I'm there. So you were 22 and someone asked you, “Ryan, where do you want to be? Where do you see yourself in five years?” Ryan: At that moment, I was trying to figure that out, naturally, as you do when you're approaching the end of college. While I was at Berklee, I loved music. I loved recording music, but my absolute favorite class—they only had one of them, but it was the class I yearned for, that I wanted to take and put in all these extra hours for—was audio for visual media, audio for video. By far, that was my favorite class. The whole class, we were working toward our final project. You choose a five to seven minute clip from a well known movie, and all the audio is completely stripped. You have to recreate everything. That's all the dialogue, all the foley, all the ambient background, all the hard effects, and so on. You have to connect with a film scoring student there at Berklee, and they have to provide the score. I absolutely loved every aspect of that project and the process. When it came time to decide what I wanted to do with my life, it was between audio engineering at a recording studio, working at Disney as an Imagineer, or doing audio at a church. I have always been involved with church, playing on worship teams and whatnot, so I also saw myself doing audio for a church. Long story short, I was really privileged to dip my feet in all of those things after college. After I graduated, I moved back to Las Vegas. Eventually, I found an incredible recording studio, probably one of the top two recording studios in Las Vegas, and I landed an internship. First Audio Engineering Jobs Ryan: I say “internship” loosely, because your typical studio internship is all the stereotypical grunt work—taking out the trash, doing the coffee, and whatnot. I showed up, and they were like, “You went to Berklee? Berklee guys are cool. Here, hop in this session and help us out.” It was open to me, thrown at me, and next thing I knew, I was assisting on sessions with huge clients, I won't name drop. Aaron: You can drop a couple of names if you want. Ryan: I had a pretty fun time helping out with a session with the famous engineer Eddie Kramer, who is engineering for Carlos Santana. Aaron: Dang, man! That's awesome. Ryan: That was pretty incredible. But while I was there, I had this gut feeling inside of me saying, “This isn't it.” Aaron: It's fine, but it's not quite right? Ryan: I could see myself staying there and working my way up, but it didn't feel right. A few months after I realized that I didn't want to stay at the studio, I applied and was offered a job at Walt Disney World in Orlando, Florida. I packed my bags, moved to Orlando, and I was working as a stage technician at the Epcot park. There, they found out that I was an audio guy, so they pushed me toward the live audio side of things. I was mixing shows and bands at Epcot and what was at the time Downtown Disney, now Disney Springs, area. Same thing. Almost as soon as I got there, the same gut feeling came in. I was like, “This isn't it. I'm more of a studio engineer. I definitely don't want to do live stuff.” Although I love Disney, it just wasn't sitting right. I was only there three months before the next great opportunity came up, which is where I am right now. One of my friends told me about a job opening for this church in Charlotte, North Carolina, Elevation Church. I had actually been following them because of their podcast. At the time, I was kind of like, “I've got a job, whatever.” For some reason, I ended up on their website, looking at the job. I was reading, and I was like, “Wait a minute, they're looking for someone to do audio for video. That's what I really want to do!” On a whim, I threw out my resume. Next thing you know, I've been here going on five years. Aaron: Did you mention that you were a podcast listener when you sent in your resume? Ryan: Yeah. Aaron: The connections you can make through podcasting is really incredible. Ryan: It is. And I've been working there for 5 years now. How to Get Into Audio Engineering Aaron: I want to jump into what you do at your job at Elevation, but let's pause and do a section on what advice you would tell someone who's wanting to get started. I wrote a couple of things down here. I think it's hilarious that you got a Macbook and your first microphone was a USB microphone. Ryan: Which was the Blue Snowball, by the way. Aaron: That's the worst microphone! Ryan: I had no idea how to use it, either. If I find some of the earliest recordings I did, there are times I'm clipping to the max, square waves. Aaron: Probably bad mic technique, too. But hey; it got you started! If you want to do anything with audio, start by getting a cheap USB microphone. Any USB mics will work for getting started. I like the Blue Yeti, but it's like $100. The ATR-2100 is fine, too. You just have to get something that can record some audio and start playing with it. Start playing with Garageband. Start playing with the free programs. Learn how to enable recording on a track, how to set your input device to the microphone, how to set your output device to wherever your headphones are plugged into, whether that's your mic or your computer. It took me so long to figure that stuff out. I was like, “Why can't I hear the audio in my headphones? What is going on?” Ryan: Same here. Aaron: You have to set input and output, then you have to record enable or do the input monitoring, all that stuff. But start with the USB microphone. Take some basic classes. There are so many great online classes. If you don't have any money at all, if you're super broke like I was when I started, watch some free YouTube videos. Read a book. Ryan: If you go to Coursera.org, they're a website where you can pay to take online courses and get certifications and whatnot, but they also offer free online courses. They even offer free online courses from Berklee. I've seen a music production class there. I've taken a free online song writing class. Check out free online courses, because they can be a pool of incredible knowledge. I took a photography class on there. Coursera is a great place. They're great if you want to take free online courses. Aaron: There are places where you can learn all this stuff. You just have to invest some time. You really just have to start: Don't wait until you have $500 for an interface and $200 for some professional headphones and microphone. Whether you want to start a podcast, start recording audio for a video, or record and mix a demo for a band, start doing something. Stop spending all your time thinking about how you can't do anything because you don't have certain gear or you're not in the right place. You'll learn as you do, especially in audio. You're going to make a ton of mistakes. Ryan: That's how you learn, though! That's one of the most valuable things I've learned in life. You learn from your mistakes. Aaron: You don't really learn when everything goes well. Just Start Aaron: Any other advice you would give somebody, thinking back on how you got to where you are right now? Ryan: Honestly, you hit the nail on the head with “just start.” It's as simple and cliche as Nike, “Just do it.” There is always going to be the next latest craze, the gear, and we've all been susceptible to that. We say, “Oh, well, I could do this if I had X.” It starts with the drive and determination, wanting to do it. There's knowledge out there everywhere. You just have to dig for it. Chances are, you have at least something you can start with. Record something on your phone. Aaron: I have a friend who makes some awesome music on his iPhone. Ryan: Oh, totally. It's as simple as getting an adapter. You can plug your guitar or whatever into your phone. Aaron: Kids these days have it so easy! Ryan: You have Garageband on your phone. I remember when I was figuring this out in high school, and we actually had a four track tape recorder. That was my first start. Get started with whatever you have. Aaron: What kind of stuff do you do at the church? What's your day to day life like? Are you there every day, or is it just a couple of days a week? Ryan: Oh no, I'm definitely there every day. It has been a whirlwind for sure. In the past five years, I have probably played every audio role that there is to be played here. My main thing now is audio for broadcasts, pretty much anything that leaves the church. Our biggest output is the sermon, which goes to a lot of places. It also goes in the TV episode, which we talked about, which goes locally, nationally, and, I believe, globally as well. That's a lot of what I've done. We also create a lot of films, short films, for our worship experiences, anything you can imagine that's video and audio related. Audio post production, like we talk about. I'm constantly on video shoots using field recorders, the boom op, anything you can think of. Audio for video, I've done it. The Gear Ryan Uses Aaron: Let's talk about your gear a little bit. What kind of stuff are you using most in everyday life? I'll do a quick recap: I have the Shure Beta 87A Mic as my main podcasting microphone. It's attached to a Scarlett 18i20 USB Interface (update: I'm now using my Zoom H6 exclusively), which is plugged into a quadcore iMac that's a couple years old. Nothing super fancy, but I'm really happy with where I am. I remember wanting all this stuff back in 2011, thinking how awesome it would be to have it. I have a Zoom H6 portable recorder and a couple of SM58 microphones. I've been pairing down my gear collection because I'm planning on moving in the spring. What kind of stuff are you working with? I use Logic Pro X for editing, and then Izotope iZotope RX 5 for cleaning up background noise or fixing clipping. What about you? What's your day to day favorite gear? Ryan: We use a lot. There's a bunch of gear for field recording and then in my office, which is where I'm at right now. I'll start with my office. Right now, I'm talking into my personal mic, which is a Rode NT1A. It's very affordable. The Rode NT1A is a nice beginner mic which works and sounds great, and I use it for a lot of voiceover projects. Aaron: I like those mics. Ryan: I'm talking into that right now. We also use the Shure SM7B. We have a nice Neumann that we'll use for bigger projects. We like to use Universal Audio Interfaces, so I've got one of those. They're great. They're rock solid. You really can't beat them. At our main recording/editing audio work station, we use Pro Tools. That's very standard, and I've been using that for years and years. I use a lot of plugins. I use a lot of the Waves Plugins. I do use RX as well, and that's the bulk of it. I do a lot of processing, depending on the project. I have a really huge sound library for if I'm doing narrative pieces that involve sound design, sound effects. I have a great app called Audio Finder, which a lot of electronic musicians use to help them find sounds. I use it to help me find sounds. It's a nice way to catalogue sounds if you're a sound designer or anything like that. You can basically tag all these audio files with meta data, and you can search for sounds by their title. Or, if you type in a word in the search bar, it can pull up things based off the the metadata. If you have notes on something, it can find it. Audio Finder is a great way to find sounds. I have some other things in here. I have the Artist Mix Controller made by Avid. I use those if I'm automating stuff. I use those a lot, actually, when I'm mixing the sermons. I do a lot of automation for that. If I'm mixing a piece with a music bed or something, I like to automate the music by hand. It feels more natural, as opposed to clicking and making little dots. That's the bulk of it here in the office. All of our audio engineers have a nice pair of Focal monitors. I also have another set of monitors I built myself. When I mix TV episodes, I have an output routed to a TV here in my office so I can hear how it translates on TV speakers. Recording Audio for Video Ryan: On the front end of things, if we're doing shoots for videos, we use Sound Devices field recorders. We have three different models: the Sound Devices 788T 8 Channel Recorder, a 702 2 Channel Recorder, and then a 633 6 Channel Recorder. That last one is one of their newer models, which is great. Sound Devices are steep in price, but they are rock solid. One of the most trustworthy, well known field recorder brands on the market. That's what you'll see on pretty much every big budget shoot in some way. I do a lot of freelance on the side, which gives me the opportunity EPK shoots or BTS shoots for, recently, a show on HBO called Outcast. Aaron: Outcast? I've been seeing that (I watch Westworld). Ryan: I'm pretty sure it's the same writers or producers or something. I know it's the same writer as The Walking Dead. They shoot here in North Carolina, so with a local production company, we've done some interviews with some of the cast and crew. It's been really neat to be on set and see what they're using. It's cool to see how similar their world is to what we're doing day to day, just with more money and more resources. It's the same thing. Most of their audio guys have some sort of Sound Devices. A lot of them use the 788 as a backup recording rig, and they've got larger multitrack recorders as well, that are also made by Sound Devices. Sound Devices is a great brand. They're crazy expensive, but when you buy that, you know you've basically got it for life. Aaron: Yeah, I'm looking at the Sound Devices 788T SSD 8 Channel Portable Solid State Audio Recorder. It's almost $7,000. I love that! So fancy. Ryan: That SSD does have an internal hard drive. Ours has a hard drive as well, so it's great, because it has the internal hard drive, but you can also use CF cards. You can record on two different mediums. In case something runs out of space, you have it in two places. Aaron: This is super professional stuff. Ryan: Yeah. It is. It's top of the line. Aaron: Fantastic. For all the rest of you, just go with the Zoom H4N or the H6. Ryan: Hey, we do have a Zoom H4N, and we do use that every now and then. Before I came on staff, our first field recorder was the Zoom H4N. Aaron: If I could start over and go back to before I had any kind of interface at all, I think I would buy myself an H4N or an H6. Not only are they portable field recorders so you can walk around with them—they have little stereo condensor mics on them—but they work as audio interfaces, too. You can plug it into your computer with a USB cable and record straight to your computer if you do any kind of podcasting or stuff like that. It's good for the price. Otherwise, the little two channel interfaces are great. They're about $100 for a good one, but they aren't portable. You can't take them to a show or out to a video shoot the way you can an H4N or an H6 or something. Ryan: Speaking of Zoom, they've recently come into the more professional field recording market. About a year ago, they releases the F8, I believe, which is an 8 channel field recorder with 8 mic pres. It's $999 for something very comparable to a Sound Device. It's not quite as high-fidelity, but for anyone starting out, you're really not going to notice the difference. Mixing On Expensive Headphones or Monitors Aaron: I was going to ask you this earlier. You mentioned that you had Focal monitors. Did you listen to the episode I did a few episodes back where I talked about mixing on headphones (Episode 69: Do You Need Expensive Headphones to Mix a Podcast?)? Ryan: Yes, I did. Aaron: I mix on $10 Panasonics. What do you think about that? You can be totally honest with me. You can tell me that it's a stupid idea or that it's okay. Ryan: I agree to a certain extent. I agree that you should be listening to what you're making on whatever the majority of people are going to be listening to it on. For a lot of audio engineers mixing music, that's iPod earbuds, those standard earbuds you get. Something like that. When I mix TV, I have an output routed to a TV in my office, so I can hear it on TV speakers. I do also believe in mixing on something with some sort of higher fidelity type of monitoring environment, whether that's nicer speakers or nicer headphones. Naturally, you're going to hear things differently. The main thing to take away is how things translate. If you're listening to something on one source and you make it sound good there, that's great, but in a different environment, it may sound completely different. iPhone earbuds may not have the bass that a car stereo has. You want to hear how it translates from one thing to another. That's why it's good to at least listen to it on two different sources and not just narrow yourself down to one cruddy thing. That's good in theory, but again, the key takeaway is translation. Aaron: Maybe it's a little bit different for me and I can get away with it because of the consistency of the microphones and the recording environment set we use. Ryan: Yeah, totally. Aaron: I think if I was doing more stuff like you are, with videos and clients and all that kind of stuff, I would absolutely be using my higher fidelity headphones. Ryan: Very true. The bulk of your work is dialogue, podcasts. Aaron: Yeah, that's really it. Just dudes talking into a microphone. Ryan: Yeah. I have done a lot of work here where I'm working in a small studio, but a lot of my mixes have played in auditoriums and arenas. If you're working on projects like music or film that have different audio frequencies and spectrums, remember that sound will be perceived differently in different places. Aaron: How do you even test for that? Ryan: Here, I at least have a sense of how our auditorium sounds, so I've trained my ear to hear in advance and understand how it's going to translate. For something like when we did a live recording in the biggest arena here in Charlotte, we had a video opener piece. I was on point for mixing that, so basically, I had to work with tech and production to find a time after setup where I can bring my session, copy it onto a laptop, and play it through the PA. Then I can make any final mix tweaks there in the auditorium or the arena. I perfected it in my studio, and any small tweaks I was able to do in that actual environment. Granted, a lot of the times, we may not have that luxury. There are also great plugins you can buy that simulate different monitoring environments, like Sonarworks. If you have certain pairs of headphones, you can tell the program, “I have these headphones, now make my mix sound like it's coming through these headphones or these speakers,” so you can hear how it might translate. In that program, they have a final output like the Beats headphones. You can hear how it might sound on there, super bass heavy. Aaron: I hear they're getting better, but I still have never bought any Beats headphones. I probably should (just for testing purposes). Ryan: There are definitely programs out there to help you see how things translate to different monitors. On Location Gear Ryan: We were talking about the gear we use for on location recording. Sound Devices would be our main recorders. For our mics, we use Schoeps. It's a shotgun microphone, so it's a narrow polar pattern with good off axis rejection. Schoeps is a great brand. Again, you'll see this on professional movie sets. That's the mic we use. We have some Sennheiser shotguns as well, the ME66, we have a couple of those, which is more their entry shotgun mics. Recently, I rented some of the MKH416. Aaron: I would like one of those. The Sennheiser 416 is well known as the classic TV shotgun mic, right? Ryan: Exactly. I rented those out because I wanted to try it out for that reason. The Schoeps is very good and very well known on set as well, but so is the 416. I rented it to try it out. It's a trusted mic that a lot of people use for these professional things, and it doesn't really break the bank for what it is. Aaron: They're like $1,000, I think. Ryan: Yeah, and it sounded great. Aaron: The next mic I get is either going to be that or the Rode NTG 3. Ryan: I've heard a lot of great things about that. I haven't tried one myself. Aaron: That's the shotgun mics we shot my podcasting courses with. Ryan: Yeah, I know that Sean uses that for all of his videos. Aaron: I'm excited about getting to go work with those (I'm moving to San Antonio in March or April). Master the Basics Aaron: That's a pretty good run through of your gear. I'm sure you could keep going and discuss a lot more, but I don't think we need to go into that. It seems like you guys are at a super professional, high quality. You have made big investments in professional gear, which is fantastic. I encourage everyone to strive for that, to aim for that, but like we said earlier, use what you have right now. I don't have anything close to what you guys have, but I'm still doing my podcast. I'm doing the best I can with what I have. Ryan: It still sounds great. Aaron: Thanks! It's mostly just knowing how to set gain levels and not having a noisy room. It's crazy how far the basics will get you— everything else is just icing on the cake. I've been watching this video course called Zen and the Art of Work, which I really recommend to everybody. It's mindfulness training mixed with productivity training, which is such a great combination. In this course, he says, “So many of the masters continually revisit the basics.” Mastery is staying on a path. It's not reaching some final goal, it's more about being with the work and investing in getting better, but also revisiting the basics. He was talking about playing piano. He was like, “A lot of times, I just start by touching the keys, pressing the keys, and then doing basic scales over and over again.” It's true. When you get so good at the basics that you don't have to think about it, that's when you start to expand and get to that level where people say, “Wow, you're so good at that. How did you get so good?” You're like, “That was just doing the basics. It's not anything fancy.” It's so important to master the basics and keep going back to them. Learning More Aaron: What's next for you? How do you invest in yourself and improve? Or are you working so much that you always have more learning opportunities? Do you buy books or courses or follow any websites to learn more about this audio stuff? Ryan: Honestly? We had a shift at work to where my role has shifted to mainly just broadcasts. That has enabled me to have a little bit more flexibility and free time, so I've been doing a lot more freelance work. That's great, because it energizes me and keeps me engaged. It keeps me from routine. Routine is great. I love routine, that's very much my personality, but freelance work keeps things interesting. For me, it's all about where and how I can get inspired and constantly feeding that. It's about feeding my desire for creativity. We're all creatives. We like to create. We were designed to be creators, really. Everything I try to do is about how I can become a better creator and what I can create next. It's about finding things that inspire me, really. We touched lightly on a few of the resources that I like, things I've learned and places I've picked things up. If you're interested in audio for post production, there are a couple of great books by Ric Viers. I have two books by him that are really great. The first one is The Sound Effects Bible, and it's not just sound effects in there. He talks about everything from gear to microphones, basics, setting proper gains, compression, some mixing techniques, etc. He also has The Location Sound Bible. There are a lot of similarities, but there's also a lot of talk about gear, shotgun mics, lop mics, recorders, and then he also dives into some of the basics when it comes to mixing, proper gain staging, and so on. Those are a really great pool of knowledge in book form. There are a lot of other books out there, but I have found those two to be really helpful. Other than that, when it comes to audio for video, it's a very small, niche field. There isn't a crazy amount of stuff out there, like there might be for mixing music. For that, you've got tons. You've got Pensado's Place, all these people on YouTube putting out channels on mixing, mixing from home, mixing on a budget, etc. There's plenty of that. Aaron: Graham Cochrane and Joe Gilder are pretty awesome resources for anyone who wants to start a home studio. Ryan: YouTube can be a pool of knowledge for anything and everything, too. You have to dig a little bit and do some searching. On the inspiration side, for me, since I love audio for video, Sound Works Collection is a great place. They'll do mini videos interviewing the sound people that did sound for X movie. Whether it was the last Harry Potter or anything and everything, big budget films, they'll sit down with the recording people, the sound designers, the mixers… It's really cool, because they'll show footage of them doing stuff on location or the foley artists. It's cool to see their process. For me, that helps me stay inspired. It gives me ideas to do other things. They have a podcast as well, and that's great. The videos can be kind of short, maybe 10 minutes or so, but the podcast will go on at length, talking to the audio guys who have made sound for videos possible. It will also be music composers for movies as well. That's really great. I found that great not only as inspiration, but to know what and how audio professionals for big budget films get inside their minds, how they're thinking, and what their process looks like. It's neat to see stuff about sound engineers for big movies and realize that we're not so different. Dealing With a Broad Loudness Spectrum (Dynamics) Aaron: I have a nerdy question here. This is about normalizing and compression, I think. Aiya had asked, “I'm so torn about normalizing sound clips. If I'm working on a longer project in segments, would it be better to adjust my peaks manually for the sake of consistency? It's for a video project.” I'm hearing that there are differences in video volumes. How do you deal with that? Do you do compression? Do you do automation for the different parts? How do you deal with dynamics? Ryan: It depends on the project. I'll talk about how I would mix a sermon, because that's very dynamic. Our pastor will go from whispering, holding his handheld mic close to his stomach, to screaming, holding the microphone, cupping the capsule. Power and respect to him, because it creates a certain atmosphere, which has a powerful effect. That's what I'm dealing with on a weekly basis. That dynamic range is tremendous. Keep in mind, this is going to TV eventually. TV has very strict restrictions. It's not so much on level, but on perceived level. There's a difference between what you see meter and what you're hearing. I can talk at length about that, too. Aaron: Could you give us a super short version? I'm kind of aware of that, but since I just mix in Logic, I'm not sure how to measure it. Is there a way to measure it in Logic? Do you know? Is there a plugin you use? Ryan: I use a plugin from Waves. It's a loudness meter, and its just that. It has a lot of presets, so I'll use the TV standard preset. I'll use it for ATSE85, and I'll use it for a dialogue bus. They've also got one for a master bus. The standard right there is your average level around -24 dB LUFS, so that's full scale. If you have a classic meters, your peak would be zero, so that would average metering right around -10. At least for TV, I've got a hard limiter at -10 dB, to where nothing can go above that. The difference between levels on a meter vs. perceived loudness is the differences between what we hear and the actual energy. In our TV program, we'll have the sermon, but we'll also have a talking heads segments, which is dialogue and a music bed. We'll also go into segments where they'll go into worship from our live album, which had been mixed and mastered as an album. That thing is slammed. If you look at the wave form, it's a sausage. If I'm setting all that by the meters alone and they're all hitting -10, it may look right, but if I look at my loudness meter, that worship segment is going to be off the charts. There's so much more content in there. There's so much going on with all the different frequency ranges as opposed to a dialogue track, which is a narrow field in the frequency spectrum. That's the gist of it. When it comes to my technique for controlling dynamics, for something like mixing a sermon, if I'm going down my plugin chain, the first thing I naturally have is a high pass filter. I'm rolling off those unnecessary lows that are hogging energy. The next thing I'll do is use a compressor, and I'll set the attack to right in the middle, so not fast or slow, and I'll have the release time at fast. We don't want to hear it pumping, letting go. That's catching my peaks. It's not doing a crazy amount, but it kind of is. That's helping do a lot of the bulk compression. Before anything really hits the compressor, I will go through, and as I work my way through the mix, I will clip gain the wave form, so that, say, if he's whispering somewhere, I might keep that, depending on how I have my compressor set. Then, if we go up to a part where he's screaming and my wave form is huge, I will take that down and create those nodes, those dots in the wave form, and drag the actual clip volume down, that gain down. That way, it's not going into the compressor at this high gain level. It's hitting the compressor evenly as the rest of it would. That way, it's not driving the compressor crazy. Then I'll go through and do some EQ and DSing and whatnot. I might add some more compressors in there, just to grab some of those little things coming through. After that, it's subtle, just smoothing it out. Aaron: It is a little bit of both. If she has access to an audio editing program—I don't know what she's using for editing. If you can put a compressor on the track, do that. It's not exactly the same, but I did a YouTube video about how I process podcast vocals, and it's very similar. For podcast vocals, I start with a Logic noise removal plugin. Ryan: I actually have my noise suppressor, and I'll use that later on down in my signal chain. My way of thinking is that if I've got all this compression going on, the compression is narrowing that dynamic range, so it's bringing up that noise floor. I tend to do my noise suppression after the bulk of that compression, because the noise floor is higher and it's easier to work on a supressor. If that makes sense. Aaron: I've thought a lot about whether you should do the noise removal before or after you add a bunch of gain with a compressor or something, and I can't think of a good reason that it matters. You can take out the noise before you add a bunch of gain, or you can add a bunch of gain and take out the noise afterwards. Which is better? I don't know. Anyways, after the noise removal plugin, I put an EQ with a high pass filter, a peak compressor, an RMS or an average level compressor, and then a limiter. Ryan: Like I mentioned earlier, before I had my long-winded answer, it also depends on what it is you're mixing—whether it's music, or a podcast, or something for film. When it comes to dialogue for film, you want it to sound as natural as possible, but you also want to be able to hear if someone is whispering. When it comes to that, I'll still use a compressor, but it will be very, very light. If there's anything I need to do to meet loudness, that I will automate the volume on my dialogue bus. I'll bring that up. That way, it sounds a little bit more natural, instead of solely relying on a compressor to do all the work for you. Aaron: That makes sense. For podcasts, if I notice that there's a section where someone was talking much quieter, like if a guest backed away and talked like that for four or five minutes and then went back to the normal distance from the microphone, in Logic, I'll turn that into its own clip. I make a cut on either side of the quiet part, and then, in Logic, you can double click on it and change gain by hitting Control G. Then you can add 3, 4, or 5 dB to it. That works out pretty well. If it's every five seconds or I have to do it more than five or six times in an episode, I won't do the clip gain changes, I'll just use a compressor. Look at the overall audio file and see if there are long stretches where you can use automation to change the gain, or change the clip gain. Common Audio Mistakes Podcasters Make Ryan: You asked a question that I think would be good to talk about in regards to podcasting. You had asked, “What do you like about podcasts? What common mistakes do you hear people make?” Initially, I read this and thought, “I don't know,” but I spent some time thinking about it. This is great, because it piggybacks off the loudness thing. A lot of the mistakes that I hear when it comes to podcasts in regards to audio is the levels and loudness aspect. I'll listen to some podcasts that sound great, and I'll put on another podcast where the whole thing is super quiet. Then they start laughing, and it's really loud. There are some, like mine, where they have a music bed underneath the entire thing, and then sometimes the music bed is so quiet that you hardly know it's there. You're like, “What the heck is that noise in the background?” Sometimes, it's the opposite. Sometimes, the music bed is way too loud. That's a few of the things I've noticed. A lot of the fixes relate to what we just talked about. It helps to have knowledge of levels and perceived loudness. If you're mixing a podcast, make sure your levels are consistent. One of the biggest things I can recommend for anyone mixing anything, whether it's music, movies, a podcast, is the importance of having a reference track. Aaron: Yeah, I don't talk about that enough. Ryan: That is huge. Professional audio engineers who mix platinum records still do this. They will pull in a track from a different song that is mixed well and is mixed how they want theirs to sound, and they'll have it muted in their session. When they want to have a reference to listen to or train their ear, they'll un-mute it, and they'll go, “Oh, okay.” I'm sure you've done the same thing as me, where you'll be so involved in a mix, you're in it, and you think it sounds great, and then maybe you go away. You go home, sleep, and maybe you come back, and you open it up and you go, “Woah! What was I thinking!” You can get so involved in it that the blinders go up. You get tunnel vision, and you're not aware to some things. It's good to have a reference track or get an outsider's opinion on a mix. The main takeaway here is the reference track. That would help with anything, whether it's the timbre, how you're EQing, or the loudness. You pull in their track and it's far louder than yours, and you automatically know that you need to do something about it. Aaron: That's a great idea. You can kind of do this before or after. You go through and you edit your whole podcast, get everything set up the way you want, create an extra track, and then find a podcast that sounds really good—This American Life or pretty much anything by NPR—download an episode, drop it into your editing program, and play it, mute it, and see what the difference is. Maybe you need to add some gain with an adaptive limiter or with a compressor, or maybe you can tell that your track sounds way sharper or harsher. Are there are too many high frequencies or too much bass compared to your reference track? You can adjust those things. I'm so glad you mentioned that. I've never thought of that before, and that's such a good idea. Ryan: It's one of those things you don't think of much, but once you do it, you're like, “Oh my gosh!” It's really eye opening and really helpful. You can find Ryan online at ryanmonette.com, and follow him on Twitter @RyanMonette.

My guest this week is professional audio engineer Ryan Monette. Ryan graduated from Berklee College of Music with a degree in Music Production & Engineering. For the last 4.5 years he's been the Post-Production Audio Engineer on staff at Elevation Church, in Charlotte, NC, where he mixes their global TV show, and has many other responsibilities (boom operator, field recorder, sound designer, audio editor, etc.). You may have heard some of his work, as he sound-designed and mixed the opener video for the Circles conference for the past two years. He even had his own podcast for a short while (TheQueuecast.com). I asked Ryan to come on the show to share his journey towards becoming a professional audio engineer (a job that I've always wanted), and to get him to share some tips for anyone interested in working in audio/video professionally.Highlights, Takeaways & Quick Wins:Think long term and dream big.If you want to do anything with audio, start by getting a cheap USB microphone.Take advantage of free online courses to learn more about audio engineering.Get started with whatever you have.Your mix may sound completely different in a different environment, so listen with different headphones/speakers in different locations.Master the basics and keep going back to them.If you’re mixing a podcast, make sure your levels are consistent.When mixing, always use a reference track.Show NotesAaron: You graduated from Berklee College of Music with a degree in music production and engineering. For the last five years, you’ve been the post production audio engineer for Elevation Church in Charlotte, North Carolina. You have a lot of jobs there: boom operator, field recorder, sound designer, audio editor, and you mix their global TV show. Do you mix that live?Ryan: Not necessarily. We can get into that later. There’s a process for that.Aaron: Some of the creative people here might have heard of some of your work. You sound designed and mixed the opening videos for the past two years of Circles Conference, which I was at. Have you been there for the past two years?Ryan: I haven’t been personally, no. I have wanted to go. I love it from afar, and I want to go in person.Aaron: I wanted you to come on this show because when I first got started, I had dreams of being a professional audio engineer. I thought, “How cool would it be to work in audio and get paid for it? That’d be awesome!”I fell backwards into it by doing podcast editing as a hobby first, then for money, then I met Sean McCabe and ended up working for him full time. I edit podcasts and help out with a ton of other stuff. I asked you to come on the show to share your advice for anyone who’s interested in working in audio/video professionally, and to talk about how you got there yourself. So tell me a little bit about how you got into audio. When did you first realize that this was something you wanted to do?Ryan’s Journey to Becoming a Professional Audio EngineerRyan: I love listening to your podcast, Aaron, and what I love about it is I feel like you and I have a lot of similarities in our backgrounds. You’re a musician, a drummer, and I’m also a musician. I play several things. My primary instrument is bass, but along with that, I started on piano. I picked up bass, and with the bass I picked up guitar. I took some drum lessons here and there as well.I sing as well. I dabbled in a little bit of everything. I’m kind of a jack of all trades, master of none. I’m okay at a lot of things, but I’m not superb at one thing. Anyway, right around junior high or high school, I started playing the bass. I started playing in little bands here and there. When it came time for college, I had no clue what I wanted to do. All I knew was that I loved music.Aaron: Same here!Ryan: I was living in Las Vegas at the time, so I decided, well, everyone has to have that college experience, and I didn’t want to go to college in the same city, so I decided that I needed that “being away from home” experience. I went to the University of Nevada, Reno. I took your basic, general classes, not knowing what I wanted to do. At this time, for my high school graduation, I had received a graduation present of a Macbook Pro.With that, of course, you get the wonderful iLife suite, including Garageband. As a musician, a whole new world was opened up to me. When I was in a band in high school, I was the gear head—I loved the PA and putting cables together.I was drawn to that. Once I had this Macbook Pro with Garageband and I had my bass and my guitar in my dorm, I was like, “I can create music!” I figured out how to work it and record myself. I bought a USB microphone, and that world was opened up. When I was there, I had a friend, and her brother went to this school where all they learned about was music. I was like, “Wait, you can do that? You can go to school for just music?”That’s how I found out about Berklee School of Music. I applied, and you have to audition as well. I applied and auditioned, and the first time I tried, I actually didn’t get into the music school I wanted to go to.Aaron: This sparks something in my mind. I feel like I might have read an article about Berklee or looked into it and thought, “No, they’re really strict on who they accept, based on your performance.” That was intimidating to me at the time, because I never felt like I was that good of a drummer.Ryan: It was intimidating for me, too. Clearly, I wasn’t up to par.Aaron: Yet you went for it. That’s more than a lot of people would do.Ryan: Yeah. After I finished my first year at UNR, I moved back to Vegas and went to UNLV, the University of Nevada Las Vegas. I took all music classes, forgetting the general ed stuff you need to get a degree. I took all music classes—music theory, because I had never had actual music theory classes, so I thought I needed that. With that, there were some audio classes that I took as well. I was like, “Hey, I like this audio thing.”At the University of Nevada Las Vegas, I had my first exposure to a formal audio class, where I learned all the proper techniques. Later on that year, I applied and auditioned again for Berklee. I got accepted, and the next year, I moved to Boston and went to Berklee for about three and a half years. Then I graduated. When I went to Berklee, the only thing that drew me as a major was Music Production and Engineering. I naturally loved the gear side of things. I fell in love with recording. I was like, “This is what I want to do.”Aaron: You got to spend three and a half years there, studying and learning?Ryan: It is non-stop, 24/7, music, audio, and to be honest, I miss being in that environment so much.Aaron: That sounds fantastic. I always love setting aside time to take online classes, read books, and listen to interviews about audio.Think Long-TermAaron: You were drawn to the audio engineering stuff, and then you graduated.Ryan: I can remember a specific time in my life, and I’m pretty sure it was my last semester at Berklee. They went by semesters instead of years. It was in one of my capstone classes. Our instructor asked us the typical, “Where do you see yourself in five years?” question.Aaron: I love that question now. I hated it when I was 22.** Think long term and dream big**Aaron: Plan out where you want to be, because if you can envision it, then you can figure out how to get there. But you have to start by saying, “I want to do this thing someday.” For me, it was, “I want to do work from a laptop. How do I get there?” Now I’m there. So you were 22 and someone asked you, “Ryan, where do you want to be? Where do you see yourself in five years?”Ryan: At that moment, I was trying to figure that out, naturally, as you do when you’re approaching the end of college. While I was at Berklee, I loved music. I loved recording music, but my absolute favorite class—they only had one of them, but it was the class I yearned for, that I wanted to take and put in all these extra hours for—was audio for visual media, audio for video.By far, that was my favorite class. The whole class, we were working toward our final project. You choose a five to seven minute clip from a well known movie, and all the audio is completely stripped. You have to recreate everything. That’s all the dialogue, all the foley, all the ambient background, all the hard effects, and so on. You have to connect with a film scoring student there at Berklee, and they have to provide the score. I absolutely loved every aspect of that project and the process. When it came time to decide what I wanted to do with my life, it was between audio engineering at a recording studio, working at Disney as an Imagineer, or doing audio at a church.I have always been involved with church, playing on worship teams and whatnot, so I also saw myself doing audio for a church. Long story short, I was really privileged to dip my feet in all of those things after college. After I graduated, I moved back to Las Vegas. Eventually, I found an incredible recording studio, probably one of the top two recording studios in Las Vegas, and I landed an internship.First Audio Engineering JobsRyan: I say “internship” loosely, because your typical studio internship is all the stereotypical grunt work—taking out the trash, doing the coffee, and whatnot. I showed up, and they were like, “You went to Berklee? Berklee guys are cool. Here, hop in this session and help us out.” It was open to me, thrown at me, and next thing I knew, I was assisting on sessions with huge clients, I won’t name drop.Aaron: You can drop a couple of names if you want.Ryan: I had a pretty fun time helping out with a session with the famous engineer Eddie Kramer, who is engineering for Carlos Santana.Aaron: Dang, man! That’s awesome.Ryan: That was pretty incredible. But while I was there, I had this gut feeling inside of me saying, “This isn’t it.”Aaron: It’s fine, but it’s not quite right?Ryan: I could see myself staying there and working my way up, but it didn’t feel right. A few months after I realized that I didn’t want to stay at the studio, I applied and was offered a job at Walt Disney World in Orlando, Florida.I packed my bags, moved to Orlando, and I was working as a stage technician at the Epcot park. There, they found out that I was an audio guy, so they pushed me toward the live audio side of things. I was mixing shows and bands at Epcot and what was at the time Downtown Disney, now Disney Springs, area. Same thing. Almost as soon as I got there, the same gut feeling came in.I was like, “This isn’t it. I’m more of a studio engineer. I definitely don’t want to do live stuff.” Although I love Disney, it just wasn’t sitting right. I was only there three months before the next great opportunity came up, which is where I am right now. One of my friends told me about a job opening for this church in Charlotte, North Carolina, Elevation Church. I had actually been following them because of their podcast.At the time, I was kind of like, “I’ve got a job, whatever.” For some reason, I ended up on their website, looking at the job. I was reading, and I was like, “Wait a minute, they’re looking for someone to do audio for video. That’s what I really want to do!” On a whim, I threw out my resume. Next thing you know, I’ve been here going on five years.Aaron: Did you mention that you were a podcast listener when you sent in your resume?Ryan: Yeah.Aaron: The connections you can make through podcasting is really incredible.Ryan: It is. And I’ve been working there for 5 years now.How to Get Into Audio EngineeringAaron: I want to jump into what you do at your job at Elevation, but let’s pause and do a section on what advice you would tell someone who’s wanting to get started. I wrote a couple of things down here. I think it’s hilarious that you got a Macbook and your first microphone was a USB microphone.Ryan: Which was the Blue Snowball, by the way.Aaron: That’s the worst microphone!Ryan: I had no idea how to use it, either. If I find some of the earliest recordings I did, there are times I’m clipping to the max, square waves.Aaron: Probably bad mic technique, too. But hey; it got you started!If you want to do anything with audio, start by getting a cheap USB microphone.Any USB mics will work for getting started. I like the Blue Yeti, but it’s like $100. The ATR-2100 is fine, too. You just have to get something that can record some audio and start playing with it.Start playing with Garageband. Start playing with the free programs. Learn how to enable recording on a track, how to set your input device to the microphone, how to set your output device to wherever your headphones are plugged into, whether that’s your mic or your computer. It took me so long to figure that stuff out. I was like, “Why can’t I hear the audio in my headphones? What is going on?”Ryan: Same here.Aaron: You have to set input and output, then you have to record enable or do the input monitoring, all that stuff. But start with the USB microphone. Take some basic classes. There are so many great online classes. If you don’t have any money at all, if you’re super broke like I was when I started, watch some free YouTube videos. Read a book.Ryan: If you go to Coursera.org, they’re a website where you can pay to take online courses and get certifications and whatnot, but they also offer free online courses. They even offer free online courses from Berklee. I’ve seen a music production class there. I’ve taken a free online song writing class.Check out free online courses, because they can be a pool of incredible knowledge.I took a photography class on there. Coursera is a great place. They’re great if you want to take free online courses.Aaron: There are places where you can learn all this stuff. You just have to invest some time. You really just have to start: Don’t wait until you have $500 for an interface and $200 for some professional headphones and microphone. Whether you want to start a podcast, start recording audio for a video, or record and mix a demo for a band, start doing something.Stop spending all your time thinking about how you can’t do anything because you don’t have certain gear or you’re not in the right place. You’ll learn as you do, especially in audio. You’re going to make a ton of mistakes.Ryan: That’s how you learn, though! That’s one of the most valuable things I’ve learned in life. You learn from your mistakes.Aaron: You don’t really learn when everything goes well.Just StartAaron: Any other advice you would give somebody, thinking back on how you got to where you are right now?Ryan: Honestly, you hit the nail on the head with “just start.” It’s as simple and cliche as Nike, “Just do it.” There is always going to be the next latest craze, the gear, and we’ve all been susceptible to that. We say, “Oh, well, I could do this if I had X.” It starts with the drive and determination, wanting to do it. There’s knowledge out there everywhere. You just have to dig for it.Chances are, you have at least something you can start with. Record something on your phone.Aaron: I have a friend who makes some awesome music on his iPhone.Ryan: Oh, totally. It’s as simple as getting an adapter. You can plug your guitar or whatever into your phone.Aaron: Kids these days have it so easy!Ryan: You have Garageband on your phone. I remember when I was figuring this out in high school, and we actually had a four track tape recorder. That was my first start. Get started with whatever you have.Aaron: What kind of stuff do you do at the church? What’s your day to day life like? Are you there every day, or is it just a couple of days a week?Ryan: Oh no, I’m definitely there every day. It has been a whirlwind for sure. In the past five years, I have probably played every audio role that there is to be played here. My main thing now is audio for broadcasts, pretty much anything that leaves the church. Our biggest output is the sermon, which goes to a lot of places.It also goes in the TV episode, which we talked about, which goes locally, nationally, and, I believe, globally as well. That’s a lot of what I’ve done. We also create a lot of films, short films, for our worship experiences, anything you can imagine that’s video and audio related. Audio post production, like we talk about. I’m constantly on video shoots using field recorders, the boom op, anything you can think of. Audio for video, I’ve done it.The Gear Ryan UsesAaron: Let’s talk about your gear a little bit. What kind of stuff are you using most in everyday life? I’ll do a quick recap: I have the Shure Beta 87A Mic as my main podcasting microphone. It’s attached to a Scarlett 18i20 USB Interface (update: I’m now using my Zoom H6 exclusively), which is plugged into a quadcore iMac that’s a couple years old.Nothing super fancy, but I’m really happy with where I am. I remember wanting all this stuff back in 2011, thinking how awesome it would be to have it. I have a Zoom H6 portable recorder and a couple of SM58 microphones. I’ve been pairing down my gear collection because I’m planning on moving in the spring.What kind of stuff are you working with? I use Logic Pro X for editing, and then Izotope iZotope RX 5 for cleaning up background noise or fixing clipping. What about you? What’s your day to day favorite gear?Ryan: We use a lot. There’s a bunch of gear for field recording and then in my office, which is where I’m at right now. I’ll start with my office. Right now, I’m talking into my personal mic, which is a Rode NT1A. It’s very affordable.The Rode NT1A is a nice beginner mic which works and sounds great, and I use it for a lot of voiceover projects.Aaron: I like those mics.Ryan: I’m talking into that right now. We also use the Shure SM7B. We have a nice Neumann that we’ll use for bigger projects. We like to use Universal Audio Interfaces, so I’ve got one of those. They’re great. They’re rock solid. You really can’t beat them.At our main recording/editing audio work station, we use Pro Tools. That’s very standard, and I’ve been using that for years and years. I use a lot of plugins. I use a lot of the Waves Plugins. I do use RX as well, and that’s the bulk of it. I do a lot of processing, depending on the project.I have a really huge sound library for if I’m doing narrative pieces that involve sound design, sound effects. I have a great app called Audio Finder, which a lot of electronic musicians use to help them find sounds. I use it to help me find sounds. It’s a nice way to catalogue sounds if you’re a sound designer or anything like that.You can basically tag all these audio files with meta data, and you can search for sounds by their title. Or, if you type in a word in the search bar, it can pull up things based off the the metadata. If you have notes on something, it can find it. Audio Finder is a great way to find sounds.I have some other things in here. I have the Artist Mix Controller made by Avid. I use those if I’m automating stuff. I use those a lot, actually, when I’m mixing the sermons. I do a lot of automation for that. If I’m mixing a piece with a music bed or something, I like to automate the music by hand.It feels more natural, as opposed to clicking and making little dots. That’s the bulk of it here in the office. All of our audio engineers have a nice pair of Focal monitors. I also have another set of monitors I built myself. When I mix TV episodes, I have an output routed to a TV here in my office so I can hear how it translates on TV speakers.Recording Audio for VideoRyan: On the front end of things, if we’re doing shoots for videos, we use Sound Devices field recorders. We have three different models: the Sound Devices 788T 8 Channel Recorder, a 702 2 Channel Recorder, and then a 633 6 Channel Recorder. That last one is one of their newer models, which is great.Sound Devices are steep in price, but they are rock solid.One of the most trustworthy, well known field recorder brands on the market. That’s what you’ll see on pretty much every big budget shoot in some way. I do a lot of freelance on the side, which gives me the opportunity EPK shoots or BTS shoots for, recently, a show on HBO called Outcast.Aaron: Outcast? I’ve been seeing that (I watch Westworld).Ryan: I’m pretty sure it’s the same writers or producers or something. I know it’s the same writer as The Walking Dead. They shoot here in North Carolina, so with a local production company, we’ve done some interviews with some of the cast and crew. It’s been really neat to be on set and see what they’re using. It’s cool to see how similar their world is to what we’re doing day to day, just with more money and more resources.It’s the same thing. Most of their audio guys have some sort of Sound Devices. A lot of them use the 788 as a backup recording rig, and they’ve got larger multitrack recorders as well, that are also made by Sound Devices. Sound Devices is a great brand. They’re crazy expensive, but when you buy that, you know you’ve basically got it for life.Aaron: Yeah, I’m looking at the Sound Devices 788T SSD 8 Channel Portable Solid State Audio Recorder. It’s almost $7,000. I love that! So fancy.Ryan: That SSD does have an internal hard drive. Ours has a hard drive as well, so it’s great, because it has the internal hard drive, but you can also use CF cards. You can record on two different mediums. In case something runs out of space, you have it in two places.Aaron: This is super professional stuff.Ryan: Yeah. It is. It’s top of the line.Aaron: Fantastic. For all the rest of you, just go with the Zoom H4N or the H6.Ryan: Hey, we do have a Zoom H4N, and we do use that every now and then. Before I came on staff, our first field recorder was the Zoom H4N.Aaron: If I could start over and go back to before I had any kind of interface at all, I think I would buy myself an H4N or an H6. Not only are they portable field recorders so you can walk around with them—they have little stereo condensor mics on them—but they work as audio interfaces, too. You can plug it into your computer with a USB cable and record straight to your computer if you do any kind of podcasting or stuff like that.It’s good for the price. Otherwise, the little two channel interfaces are great. They’re about $100 for a good one, but they aren’t portable. You can’t take them to a show or out to a video shoot the way you can an H4N or an H6 or something.Ryan: Speaking of Zoom, they’ve recently come into the more professional field recording market. About a year ago, they releases the F8, I believe, which is an 8 channel field recorder with 8 mic pres. It’s $999 for something very comparable to a Sound Device. It’s not quite as high-fidelity, but for anyone starting out, you’re really not going to notice the difference.Mixing On Expensive Headphones or MonitorsAaron: I was going to ask you this earlier. You mentioned that you had Focal monitors. Did you listen to the episode I did a few episodes back where I talked about mixing on headphones (Episode 69: Do You Need Expensive Headphones to Mix a Podcast?)?Ryan: Yes, I did.Aaron: I mix on $10 Panasonics. What do you think about that? You can be totally honest with me. You can tell me that it’s a stupid idea or that it’s okay.Ryan: I agree to a certain extent. I agree that you should be listening to what you’re making on whatever the majority of people are going to be listening to it on. For a lot of audio engineers mixing music, that’s iPod earbuds, those standard earbuds you get. Something like that. When I mix TV, I have an output routed to a TV in my office, so I can hear it on TV speakers.I do also believe in mixing on something with some sort of higher fidelity type of monitoring environment, whether that’s nicer speakers or nicer headphones. Naturally, you’re going to hear things differently. The main thing to take away is how things translate.If you’re listening to something on one source and you make it sound good there, that’s great, but in a different environment, it may sound completely different.iPhone earbuds may not have the bass that a car stereo has. You want to hear how it translates from one thing to another. That’s why it’s good to at least listen to it on two different sources and not just narrow yourself down to one cruddy thing. That’s good in theory, but again, the key takeaway is translation.Aaron: Maybe it’s a little bit different for me and I can get away with it because of the consistency of the microphones and the recording environment set we use.Ryan: Yeah, totally.Aaron: I think if I was doing more stuff like you are, with videos and clients and all that kind of stuff, I would absolutely be using my higher fidelity headphones.Ryan: Very true. The bulk of your work is dialogue, podcasts.Aaron: Yeah, that’s really it. Just dudes talking into a microphone.Ryan: Yeah. I have done a lot of work here where I’m working in a small studio, but a lot of my mixes have played in auditoriums and arenas.If you’re working on projects like music or film that have different audio frequencies and spectrums, remember that sound will be perceived differently in different places.Aaron: How do you even test for that?Ryan: Here, I at least have a sense of how our auditorium sounds, so I’ve trained my ear to hear in advance and understand how it’s going to translate. For something like when we did a live recording in the biggest arena here in Charlotte, we had a video opener piece. I was on point for mixing that, so basically, I had to work with tech and production to find a time after setup where I can bring my session, copy it onto a laptop, and play it through the PA.Then I can make any final mix tweaks there in the auditorium or the arena. I perfected it in my studio, and any small tweaks I was able to do in that actual environment. Granted, a lot of the times, we may not have that luxury. There are also great plugins you can buy that simulate different monitoring environments, like Sonarworks.If you have certain pairs of headphones, you can tell the program, “I have these headphones, now make my mix sound like it’s coming through these headphones or these speakers,” so you can hear how it might translate. In that program, they have a final output like the Beats headphones. You can hear how it might sound on there, super bass heavy.Aaron: I hear they’re getting better, but I still have never bought any Beats headphones. I probably should (just for testing purposes).Ryan: There are definitely programs out there to help you see how things translate to different monitors.On Location GearRyan: We were talking about the gear we use for on location recording. Sound Devices would be our main recorders. For our mics, we use Schoeps. It’s a shotgun microphone, so it’s a narrow polar pattern with good off axis rejection. Schoeps is a great brand. Again, you’ll see this on professional movie sets.That’s the mic we use. We have some Sennheiser shotguns as well, the ME66, we have a couple of those, which is more their entry shotgun mics. Recently, I rented some of the MKH416.Aaron: I would like one of those. The Sennheiser 416 is well known as the classic TV shotgun mic, right?Ryan: Exactly. I rented those out because I wanted to try it out for that reason. The Schoeps is very good and very well known on set as well, but so is the 416. I rented it to try it out. It’s a trusted mic that a lot of people use for these professional things, and it doesn’t really break the bank for what it is.Aaron: They’re like $1,000, I think.Ryan: Yeah, and it sounded great.Aaron: The next mic I get is either going to be that or the Rode NTG 3.Ryan: I’ve heard a lot of great things about that. I haven’t tried one myself.Aaron: That’s the shotgun mics we shot my podcasting courses with.Ryan: Yeah, I know that Sean uses that for all of his videos.Aaron: I’m excited about getting to go work with those (I’m moving to San Antonio in March or April).Master the BasicsAaron: That’s a pretty good run through of your gear. I’m sure you could keep going and discuss a lot more, but I don’t think we need to go into that. It seems like you guys are at a super professional, high quality. You have made big investments in professional gear, which is fantastic. I encourage everyone to strive for that, to aim for that, but like we said earlier, use what you have right now. I don’t have anything close to what you guys have, but I’m still doing my podcast. I’m doing the best I can with what I have.Ryan: It still sounds great.Aaron: Thanks! It’s mostly just knowing how to set gain levels and not having a noisy room. It’s crazy how far the basics will get you— everything else is just icing on the cake.I’ve been watching this video course called Zen and the Art of Work, which I really recommend to everybody. It’s mindfulness training mixed with productivity training, which is such a great combination.In this course, he says, “So many of the masters continually revisit the basics.” Mastery is staying on a path. It’s not reaching some final goal, it’s more about being with the work and investing in getting better, but also revisiting the basics. He was talking about playing piano. He was like, “A lot of times, I just start by touching the keys, pressing the keys, and then doing basic scales over and over again.”It’s true. When you get so good at the basics that you don’t have to think about it, that’s when you start to expand and get to that level where people say, “Wow, you’re so good at that. How did you get so good?” You’re like, “That was just doing the basics. It’s not anything fancy.”It’s so important to master the basics and keep going back to them.Learning MoreAaron: What’s next for you? How do you invest in yourself and improve? Or are you working so much that you always have more learning opportunities? Do you buy books or courses or follow any websites to learn more about this audio stuff?Ryan: Honestly? We had a shift at work to where my role has shifted to mainly just broadcasts. That has enabled me to have a little bit more flexibility and free time, so I’ve been doing a lot more freelance work. That’s great, because it energizes me and keeps me engaged. It keeps me from routine. Routine is great.I love routine, that’s very much my personality, but freelance work keeps things interesting.For me, it’s all about where and how I can get inspired and constantly feeding that. It’s about feeding my desire for creativity. We’re all creatives. We like to create. We were designed to be creators, really. Everything I try to do is about how I can become a better creator and what I can create next. It’s about finding things that inspire me, really. We touched lightly on a few of the resources that I like, things I’ve learned and places I’ve picked things up.If you’re interested in audio for post production, there are a couple of great books by Ric Viers. I have two books by him that are really great. The first one is The Sound Effects Bible, and it’s not just sound effects in there. He talks about everything from gear to microphones, basics, setting proper gains, compression, some mixing techniques, etc. He also has The Location Sound Bible.There are a lot of similarities, but there’s also a lot of talk about gear, shotgun mics, lop mics, recorders, and then he also dives into some of the basics when it comes to mixing, proper gain staging, and so on. Those are a really great pool of knowledge in book form. There are a lot of other books out there, but I have found those two to be really helpful.Other than that, when it comes to audio for video, it’s a very small, niche field. There isn’t a crazy amount of stuff out there, like there might be for mixing music. For that, you’ve got tons. You’ve got Pensado’s Place, all these people on YouTube putting out channels on mixing, mixing from home, mixing on a budget, etc. There’s plenty of that.Aaron: Graham Cochrane and Joe Gilder are pretty awesome resources for anyone who wants to start a home studio.Ryan: YouTube can be a pool of knowledge for anything and everything, too. You have to dig a little bit and do some searching. On the inspiration side, for me, since I love audio for video, Sound Works Collection is a great place. They’ll do mini videos interviewing the sound people that did sound for X movie. Whether it was the last Harry Potter or anything and everything, big budget films, they’ll sit down with the recording people, the sound designers, the mixers…It’s really cool, because they’ll show footage of them doing stuff on location or the foley artists. It’s cool to see their process. For me, that helps me stay inspired. It gives me ideas to do other things. They have a podcast as well, and that’s great. The videos can be kind of short, maybe 10 minutes or so, but the podcast will go on at length, talking to the audio guys who have made sound for videos possible.It will also be music composers for movies as well. That’s really great. I found that great not only as inspiration, but to know what and how audio professionals for big budget films get inside their minds, how they’re thinking, and what their process looks like.It’s neat to see stuff about sound engineers for big movies and realize that we’re not so different.Dealing With a Broad Loudness Spectrum (Dynamics)Aaron: I have a nerdy question here. This is about normalizing and compression, I think. Aiya had asked, “I’m so torn about normalizing sound clips. If I’m working on a longer project in segments, would it be better to adjust my peaks manually for the sake of consistency? It’s for a video project.” I’m hearing that there are differences in video volumes. How do you deal with that? Do you do compression? Do you do automation for the different parts? How do you deal with dynamics?Ryan: It depends on the project. I’ll talk about how I would mix a sermon, because that’s very dynamic. Our pastor will go from whispering, holding his handheld mic close to his stomach, to screaming, holding the microphone, cupping the capsule. Power and respect to him, because it creates a certain atmosphere, which has a powerful effect. That’s what I’m dealing with on a weekly basis.That dynamic range is tremendous. Keep in mind, this is going to TV eventually. TV has very strict restrictions. It’s not so much on level, but on perceived level. There’s a difference between what you see meter and what you’re hearing. I can talk at length about that, too.Aaron: Could you give us a super short version? I’m kind of aware of that, but since I just mix in Logic, I’m not sure how to measure it. Is there a way to measure it in Logic? Do you know? Is there a plugin you use?Ryan: I use a plugin from Waves. It’s a loudness meter, and its just that. It has a lot of presets, so I’ll use the TV standard preset. I’ll use it for ATSE85, and I’ll use it for a dialogue bus. They’ve also got one for a master bus. The standard right there is your average level around -24 dB LUFS, so that’s full scale. If you have a classic meters, your peak would be zero, so that would average metering right around -10. At least for TV, I’ve got a hard limiter at -10 dB, to where nothing can go above that.The difference between levels on a meter vs. perceived loudness is the differences between what we hear and the actual energy.In our TV program, we’ll have the sermon, but we’ll also have a talking heads segments, which is dialogue and a music bed. We’ll also go into segments where they’ll go into worship from our live album, which had been mixed and mastered as an album. That thing is slammed. If you look at the wave form, it’s a sausage. If I’m setting all that by the meters alone and they’re all hitting -10, it may look right, but if I look at my loudness meter, that worship segment is going to be off the charts.There’s so much more content in there. There’s so much going on with all the different frequency ranges as opposed to a dialogue track, which is a narrow field in the frequency spectrum. That’s the gist of it. When it comes to my technique for controlling dynamics, for something like mixing a sermon, if I’m going down my plugin chain, the first thing I naturally have is a high pass filter. I’m rolling off those unnecessary lows that are hogging energy.The next thing I’ll do is use a compressor, and I’ll set the attack to right in the middle, so not fast or slow, and I’ll have the release time at fast. We don’t want to hear it pumping, letting go. That’s catching my peaks. It’s not doing a crazy amount, but it kind of is. That’s helping do a lot of the bulk compression. Before anything really hits the compressor, I will go through, and as I work my way through the mix, I will clip gain the wave form, so that, say, if he’s whispering somewhere, I might keep that, depending on how I have my compressor set.Then, if we go up to a part where he’s screaming and my wave form is huge, I will take that down and create those nodes, those dots in the wave form, and drag the actual clip volume down, that gain down. That way, it’s not going into the compressor at this high gain level. It’s hitting the compressor evenly as the rest of it would. That way, it’s not driving the compressor crazy. Then I’ll go through and do some EQ and DSing and whatnot. I might add some more compressors in there, just to grab some of those little things coming through. After that, it’s subtle, just smoothing it out.Aaron: It is a little bit of both. If she has access to an audio editing program—I don’t know what she’s using for editing. If you can put a compressor on the track, do that. It’s not exactly the same, but I did a YouTube video about how I process podcast vocals, and it’s very similar. For podcast vocals, I start with a Logic noise removal plugin.Ryan: I actually have my noise suppressor, and I’ll use that later on down in my signal chain. My way of thinking is that if I’ve got all this compression going on, the compression is narrowing that dynamic range, so it’s bringing up that noise floor. I tend to do my noise suppression after the bulk of that compression, because the noise floor is higher and it’s easier to work on a supressor. If that makes sense.Aaron: I’ve thought a lot about whether you should do the noise removal before or after you add a bunch of gain with a compressor or something, and I can’t think of a good reason that it matters. You can take out the noise before you add a bunch of gain, or you can add a bunch of gain and take out the noise afterwards. Which is better? I don’t know. Anyways, after the noise removal plugin, I put an EQ with a high pass filter, a peak compressor, an RMS or an average level compressor, and then a limiter.Ryan: Like I mentioned earlier, before I had my long-winded answer, it also depends on what it is you’re mixing—whether it’s music, or a podcast, or something for film.When it comes to dialogue for film, you want it to sound as natural as possible, but you also want to be able to hear if someone is whispering.When it comes to that, I’ll still use a compressor, but it will be very, very light. If there’s anything I need to do to meet loudness, that I will automate the volume on my dialogue bus. I’ll bring that up. That way, it sounds a little bit more natural, instead of solely relying on a compressor to do all the work for you.Aaron: That makes sense. For podcasts, if I notice that there’s a section where someone was talking much quieter, like if a guest backed away and talked like that for four or five minutes and then went back to the normal distance from the microphone, in Logic, I’ll turn that into its own clip. I make a cut on either side of the quiet part, and then, in Logic, you can double click on it and change gain by hitting Control G. Then you can add 3, 4, or 5 dB to it.That works out pretty well. If it’s every five seconds or I have to do it more than five or six times in an episode, I won’t do the clip gain changes, I’ll just use a compressor.Look at the overall audio file and see if there are long stretches where you can use automation to change the gain, or change the clip gain.Common Audio Mistakes Podcasters MakeRyan: You asked a question that I think would be good to talk about in regards to podcasting. You had asked, “What do you like about podcasts? What common mistakes do you hear people make?” Initially, I read this and thought, “I don’t know,” but I spent some time thinking about it. This is great, because it piggybacks off the loudness thing.A lot of the mistakes that I hear when it comes to podcasts in regards to audio is the levels and loudness aspect. I’ll listen to some podcasts that sound great, and I’ll put on another podcast where the whole thing is super quiet. Then they start laughing, and it’s really loud. There are some, like mine, where they have a music bed underneath the entire thing, and then sometimes the music bed is so quiet that you hardly know it’s there.You’re like, “What the heck is that noise in the background?” Sometimes, it’s the opposite. Sometimes, the music bed is way too loud. That’s a few of the things I’ve noticed. A lot of the fixes relate to what we just talked about. It helps to have knowledge of levels and perceived loudness.If you’re mixing a podcast, make sure your levels are consistent.One of the biggest things I can recommend for anyone mixing anything, whether it’s music, movies, a podcast, is the importance of having a reference track.Aaron: Yeah, I don’t talk about that enough.Ryan: That is huge. Professional audio engineers who mix platinum records still do this. They will pull in a track from a different song that is mixed well and is mixed how they want theirs to sound, and they’ll have it muted in their session. When they want to have a reference to listen to or train their ear, they’ll un-mute it, and they’ll go, “Oh, okay.”I’m sure you’ve done the same thing as me, where you’ll be so involved in a mix, you’re in it, and you think it sounds great, and then maybe you go away. You go home, sleep, and maybe you come back, and you open it up and you go, “Woah! What was I thinking!” You can get so involved in it that the blinders go up. You get tunnel vision, and you’re not aware to some things.It’s good to have a reference track or get an outsider’s opinion on a mix.The main takeaway here is the reference track. That would help with anything, whether it’s the timbre, how you’re EQing, or the loudness. You pull in their track and it’s far louder than yours, and you automatically know that you need to do something about it.Aaron: That’s a great idea. You can kind of do this before or after. You go through and you edit your whole podcast, get everything set up the way you want, create an extra track, and then find a podcast that sounds really good—This American Life or pretty much anything by NPR—download an episode, drop it into your editing program, and play it, mute it, and see what the difference is. Maybe you need to add some gain with an adaptive limiter or with a compressor, or maybe you can tell that your track sounds way sharper or harsher.Are there are too many high frequencies or too much bass compared to your reference track? You can adjust those things. I’m so glad you mentioned that. I’ve never thought of that before, and that’s such a good idea.Ryan: It’s one of those things you don’t think of much, but once you do it, you’re like, “Oh my gosh!” It’s really eye opening and really helpful.You can find Ryan online at ryanmonette.com, and follow him on Twitter @RyanMonette.

Heyang: For those who worship in the Apple Chapel, the iPhone 7 is the item of ultimate desire. But a company policy in central China’s Henan province goes as this: any employee who buys an iPhone 7 or iPhone 7 Plus gets the boot. Why is the company sticking its nose in the employee’s phone-purchasing decision? Guys, what’s going on here? Hongling: Well, according to a report by Henan based Hnr.cn or映像网, a notice was released by the company on Sept. 18 which reads “Our company forbids all employees from using or buying the iPhone 7 and iPhone 7 Plus. Whoever is found in violation of that rule will be immediately forced to resign”. The notice also called for employees to stop buying other U.S.- and Japan-made products, and to support domestic products instead. And also the company theory here is that “If we have some disposable income, and if conditions allow it, let’s use the money to take better care of our parents’ health. Let’s pay more attention to our kids’ growth, to the value of life and to the prosperity of our country.” So maybe instead of buying a phone I guess.Ryan: Yeah, I don’t know, I mean hahahah (Heyang: This is completely outrageous for you Ryan), ah, yeah. I think my eyeballs did a full rotation backwards in my skull when I read this, um and I think it’s—I mean I’m all about people loving their country, I think that’s great, but at the same time too, I think competition and buying the phone that you choose andspending the money that you work hard for, the way you want, not having to worry about losing your job, that’s some security everybody should have. And you know I always kind of been skeptical myself about the iPhone. I’ve had I think a four, and that’s about it, and it was a good phone. But by no means am I like, worshipping at the ‘Apple Chapel’, we are getting married at the ‘Apple Chapel’, I don’t know, people probably done it. But um, I don’t know. Heyang, actually so if you are in this company, you might be in trouble. Heyang: Ok, just say a little bit more about that why then. Ryan: Well, so Heyang has been, I think she’s been dealing with a relic phone for so many years. It was all derelict. She made it work, but um she finally decided to step out the cave a little bit, look outside, and suddenly someone dropped an iPhone 7 in her hand and she’s like ‘Technology!’. And she’s still learning how to use it, but it’s a great phone, and uh it’s really cool. She totally deserves it because she’s been using such an old phone for so long. But that being said, how would you feel? Heyang, you just got this phone, do you think this company is justified if you are working there? Getting rid of you because you got this phone.Heyang: And judging by how much I put out to purchase that phone. First of all, it’d better be good, I’m still trying to learn the functions right now, and it is not easy for a cave woman like myself, and further I haven’t gotten the previous one, so it’s a big leap for me. So you know, I’m very happy that I got this new thing. But, if my boss is judging me by the handbag I get, or my phone or what the lipstick that I’m wearing today, I feel why are you interfering with my personal business when I can delivery my A game at work, and I follow all other company rules. I’m a star employee, why does it matter what phone I get? And here I don't comprehend what the company’s explanation at all. I don't get it at all. Because it says it’s anti-Japanese aggression, well that’s apparently one of the explanations that you know you need to love your country more, you shouldn't be using foreign products especially given the history between China and Japan during the Second World War. And what’s up with the iPhone then? The iPhone is made by Americans and guess what during the II World War? We were close allies with the Americans, so judging by that logic, we have every right to use the iPhone it feels. So the logic does not hold, and what’s up with like being nice to your parents because you don't use an iPhone? So you don't use an iPhone, so you don't by an iPhone, you will spend that thousands of yuan on your parents instead? Who guarantees that? Too many loopholes in that thinking. So don't get it at all.Ryan: Yeah, you know I’ve been called idealistic before, and that’s ok, cause I like being idealistic. But at the same time, you know, I do understand there’s history between a lot of different countries in the world. But we often talked about how we are globalizing, and how we are all moving in a direction that is kind of like human beings are coming together, on so many fronts on what we buy, and what we like and how we do things. And I think there’s beauty in that but some people are scared. But at the same time, I think the future of humans in general, lies in us taking steps forward together? I think that doesn't mean not loving your country, but at the same time, not barring your employees from buying a phone based off of things that happened in the past. And I know it’s not the so distance in the past, but at the same time, we shouldn’t live in the past. I believe in a bright future, again idealistic, and everybody being able to buy that iphone they so desire. Heyang: Or whatever other phones you so desire. It’s up to you, why does the company have anything to do with this. And it’s sounds like the company could be very smart about grabbing public attention about this, because we’ve seen numerous stories that create controversy online, also a lot of backlash about emotionally black mailing people in ‘you have to’ supposedly love your country in some stipulated way by some stranger. Why does that make any sense to any people? Anyway, this kind of argument has also received a lot backlash online, despite supporters as well. So here, I think it’s a guarantee to talking point for people, and what better way is that to get a little bit more publicity for company even if it’s a negative one. Is that the case? Hongling: It is possible that they are just being very sneaky, but I’m very happy that I didn't mention the company’s name in our show (Heyang: Exactly). And also, what Heyang just said about emotionally black mailing people, there’s a thing that I was always trying to follow, trying really hard just by myself. Moral code is for yourself to follow, not for others. You are not using your moral code to regulate other people’s action. That is the first thing, and also, for those of you who think you can boycott like import products in a way to support your country, I have some figures for you. In 2015, the import from America to China cost is like 116 billion yuan, and the export is 482 billion, that is to say if everyone in China listens to you and tries to boycott things from America, it will cost our country like hundreds of billions of dollars or yuan. It’s just not the thing you wanna do. So stop being unreasonably patriotic, or you think you are loving your country, but actually, you are just making a very small-minded case here. Ryan: At the end of the day, buying an iPhone 7 doesn’t mean you don't love your country, it just means that you love apple products and you also love your country. And Niuhongling so eloquently well put that we live in a globalized economy, so if you think that just buying domestic products is going to benefit China, I don't think,Based off figures that’s true, so well put. Heyang: And also in a globalized age, when you’re if you’re trying to boycott some of these foreign brands. They are often manufactured in China, and think about the millions of migrant workers that work their heart out, sweating in those factories to put that phone together, are you boycotting against your fellow compatriots? That’s a question for you.

Heyang: When the lights go off in a cinema, five types of cinema monsters could be raising their ugly heads. How should we deal with them, or maybe are you one of them? Well, let’s go through this list. Ryan: Yeah, first of all, it’s the monsters being not the one you see on the screen, but the ones coming into your movie theater either being the eater, and this is someone who just seems to manage to eat and drink coke as loud as a train going by your house if you live on the train tracks. So this, yeah you know, with this one being said, people eat popcorn and drink soda. You know I’m a little more lenient on this one.Heyang: Yeah I was gonna say, with popcorn, like you guys eat it all the time Americans, generalization. Ryan: Yeah, we do. It is very like culture thing to eat with your mouth closed though in the US. So I think it’s a little less loud when you do so that way?Hongling: Yes, I think the eater is just like the smell and the sound and everything, if you lower it down a little bit, it will be fine. But when you do it, yeah, it’s not. Heyang: The crunch crunch crunch really is very very annoying. Oh!Ryan: Yeah, there’s couple of others we will get to them, but I just want to jump to the ones that I think are, I just wanna beat (go ahead). These are the phone flashers and the chatter box. And guys, you know what, I’m gonna level with you. In the US, like if you bring out your phone, and you start talking in a movie, someone might physically attack you. Like it is considered really rude, someone will yell like some really rude stuff to you. Almost inevitably, in the movie theater the personnel will kick you out. Like it’s just not a place where you do that. You are messing up everybody’s experience that they paid the same amount as you did. And you know, I completely agree with that. I think that’s the right way to handle it. Because these people drive me insane. Heyang: With these phone flashers, I think the worst type are the ones that are on the phone talking, these people should be kicked out! But there’s also the less bad ones, but you are bad (yeah you are still bad). That is just wechatting all the way or checking all kinds of stuff and (obnoxious). Yes that screen, it is so bright in the dark, and that could be so annoying. Ryan: Know that you are doing that everybody else dislikes you very much, so don’t do it. Heyang: Yeah it reminds me in the subway when now some people are playing games without the ear phones, and it’s so loud and playing stuff (like) videos that is also so loud. I think I mean it’s time to take the social etiquette to the next level and say: that is not ok you know.Ryan: I mean I get that, at the same time, I’m a little more lenient with the subway. But like places like the library, or like the movie theater, there’s just like a code of conduct. Just be quiet, and stop drawing attention away from the movies, so what is that being on your phone and having a conversation and seeing the light of your phone, it just takes away from the movie, pulls me out of it you know. Hongling: All the monsters we refer to, it’s that the people that they don't care about others, they just think about themselves and live in their own world, which bring us the last two types: the critics and the chatterbox, which means they talk in the cinema a lot, maybe out loud. Either they are chatting about the movie, or they are just criticizing about what they are seeing. That’s none of it, it’s acceptable. Heyang: And also the late comer. Ryan: Yeah, well the late comer does bug me. I mean like show up on time, whatever maybe you got stuck in the traffic. Um, the critic, as long as you are not doing that during the film, I don't mind critics snubs, I can ignore them, just fine when they are not distracting me from a movie. But, if they are doing it during a movie, oh, pursue! Heyang: Yeah and there’s once that me as a very calm pacifist person (so nice and sweet), yes and a lady as I am, like I just said. Well I’m not really that a lot of the times. But on the other day, when I encountered the late comer, the critic, the phone flasher and the eater, so four out of five combined in one. Yes, I brought up all of my courage, and said “could you please put a sock in it, we are trying to watch a movie here Mr.” And the guy pretty much almost was on the verge of hitting me. Yes that happened the other day, and I think those are the situations when you wonder how could people be so uncivilized and not caring for others at all. And now was the time for the very first time in my life I think, I wish I was a macho man with a heavy fist. Ryan: And I wish I was there because of that behavior is unacceptable. First of all, he did what he shouldn’t be doing. Second of all, the guy like threatening a girl, a woman in just my code of conduct, how I was raised, everything’s wrong with that, and I think it’s just really a coward thing to do on his part. Heyang: Yeah so those bad monsters do exist, but guess what, there were some good Samaritans I suppose (hooray!), who kind of helped out. And basically the strangers around me were sort of hushing the guy and saying that: if you don’t wanna see this, and you should leave. So for a moment, my heart was warmed by all those strangers in a Beijing cinema. And I think with all that support I got from the strangers. That it pretty much shows we are seeing that people’s social etiquette is kind of on the improve. Ryan: So be like those people, not like the monsters.Heyang: Yes, don’t be these five types of monsters.

Heyang: We were all born as chubby babies one day, but how come after college graduationor apparently during that period of time in your life, we see more skinny Chinese people as opposed to Western peers? I don't think that has much to do with genetics actually. Ok, guys, yeah so what explains this phenomenon?Ryan: Well, first of all, I’m pretty sure that you just called me and Bob chubby babies, we were very healthy looking babies, am I right Bob?Bob: Yes, I was possibly chubby but I totally applaud your right, to say that we were chubby, whether we were chubby or not, is neither here or there. Let’s sort it that one there.Ryan: Let’s talk about what happens after you know that point when we were a baby, we grow up, and how it’s different from maybe the east and west. Um and I say I think first thing we’ll talk about, and we often just talked about on the show is that, how intense the school is here, and academic is that something is so important for many Chinese students. Young Chinese people preparing for this test, that seems to be the make break for them known as the Gaokao. Well we have something similar towards high school, the SAT, but at the same time in the US, you find the emphasis and the make break of the SAT isn’t really there. It’s something that helps you to get to the better school, but I think you can still manage to get to a good school, doing OK on your SAT. The thing is, in the US, we have in high schools, in middle schools, sometimes in elementary schools, but competitive sports, and we really put an influence on our kids, to go out and try out for sports. Because we believe like maybe makes you a good all-round kid, someone that knows how to compete, be a good sports man, practice good sportsmanship, know how to act in a team, you know inside and outside of a class, and because of this, we see I think in the US at least, a more emphasis on gym culture, in high school and what not.Heyang: And also I think there’s a huge influence or emphasis in the US, correct me if I’m wrong Ryan, that if you are really good at one sport, then it’s quite easy-er you are to get into a top knot university as there's a lot of sports sponsorships or scholarships? And I think that’s so closely tied to (you know) higher education, and in China, there’s no emphasis as such, and usually the PE classes are considered as a wasted time. There’s better use of that precious time of these young people -- that is to study Math or English or some of the other subjects. Ryan: Yeah you make a really great point. It’s true that actually I was reading not so long ago about the Olympics and where a lot of the Olympic athletes came from (I think it was) Berkeley, was one of them, I don't remember what the top one was. So these top universities are getting people not necessarily based offtheir academics, but how they perform as athletes. Why? You will find in the US, that many of these athletes bring just as much recognition to the school, and more money to the school than someone who's really good at math or what not. You know a good example is at UNM (University of New Mexico, our basketball team'sgreat, we built a huge new stadium. It was amazing, and the basketball team is very lucrative for my university. It’s a focus. Bob: But then is that saying that if you are good at sport, then you can't do Math? Ryan: No, that's absolutely not. But I would say someone who focuses all their time on math, like maybe what you would see here in China, someone focusing on their academics, and then someone splitting that time up between really becoming an Olympic athlete and going to Berkeley, and then competing the Olympics, and also keeping up that academics. It's gonna be harder. One person that is very focused on one thing, that's the academics, the other----it has its balance. Bob: But I think um I suppose if I could bring in the British dimension here (yes please), because I think when we talking about Americans, I think that's probably all about um you know body building and looking fabulous, and going to the gym, and things like that. If British people I think, you know um are little larger, it's nothing to do with muscles, I think it's just we eat too much. To be honest, ah....Heyang: And actually yeah I think my initial introduction to this topic was slightly biased, and I did it on purpose, waiting for you guys to catch me actually.Bob: Suddenly going through colleg, and you know there has to be exams you know, it's comfort to eat as well, because I think we have a big culture that when you get stressed or upset, we go straight to the larder and just eat (we do too, the freshman 13), and eat and eat and eat. Heyang: Yeah also I think there is this culture aspect to us as well. In China I think the parents don't really think that body building or you know having a good physics or you know playing sport is that important, and often mum says oh that is just playing, you are wasting your time, you are playing, you should be studying. And then also in traditional culture, if not ancient culture, we have this concept of Wen and WU, so it's Civil and Military, and that goes back to thousands of years. And military is usually a connected with maybe masculinity and Wen is more about being a magistrate, and you have a big brain, and the muscles don't really come in to play. People don't really care and that has been associated with also ascetics, what women think is attractive in men as well. So there's a whole concept going on. Ryan: Yeah I think what we are seeing here in China, in how the typical male and female act in their younger years and academically and sports wise. I think it works for here, passing the Gaokao and becoming successful. Although I think it's a different story in the US, we are kind of um very a culture that does focus on the look, as well as the academics. And um I think you know it's just different, it's just different and you know what there's no right or wrong here, we just see two different cultures and how they play out in the youth. Heyang: Yeah I think there’s no right or wrong, but there's always one that's attractive in a way. I guess although that's a....Ryan: What you are trying to say here uh?Bob:　I think she's trending on a very dangerous ground here. Heyang: Yes, I have some girl friends that like really skinny guys and think that muscles "eww", basically that sums it up. But also there's other girls, like myself, that we think working out is cool, and muscles I think it's sort of like a badge honor in a way, and when I myself is lean, and I've got muscles. I like to be paired up with a guy that got some too. So depends on your own, preference and ascetics, we are not judging at all. And yes it is east meeting west, and I think we are seeing each other and encountering each other so much more. So yeah that's a topic for discussion.

He Yang:The Chinese University of Hong Kong, Shenzhen branch sent out close to 2100 denial letters touching the hearts of many students and parents. One parent said here I quote: “I am so touched. The principal has such a big heart. Not getting accepted is regrettable, while receiving the letter is just overwhelming beyond words.” Some students even decided to repeat a year and apply admissions to this university again next year. So I have heard of acceptance letters, but what is a denial letter? And why is it so special?Ryan:So basically a denial letter is letting you know as soon as been decided that “Hey, don’ t you have to wait any longer for our words. You didn’t get in and I’m sorry”. And this is very common in the USA. And I think all universities in the US will do this say “We are regretting to inform you” as always how it starts, so when you see those first words, you know how the rest of the letter’s gonna go, but so as I understand people really appreciated this, because they took the time to apply and this guy took the time to send them a message back, saying some really poetic words like “there are neither hard nor easy paths. Life comes with happiness and sorrows”. So he had quite a great speech that he send them in the denial letter and on top of that he also send them a notebook with the university’s logo and like some calligraphy work from him. This being President Xu Yangsheng of the university.Zhangwan:That’s really the communication between university and the students who have, you know, although been rejected by the university.He Yang:Yeah, first, I was a little surprised, but then did a little bit surveying around. All Chinese colleges said “Yes, I have never heard of a denial letter before”. And here’s something quite interesting. I think it’s for Chinese students, it’s kind of important, cause in the old days when you get rejected from your dream school, what you get? Nothing. So you, the young person who’s waiting to get the acceptance letter would be waiting at your door for months and if you get nothing and then you realize it’s sort of like adding insult to injury that you don’t get any thing and you’ve been waiting for so long. That is… yeah, that’s not very humane I think. So here now maybe there’s a change in things slightly. Ryan:Yeah and you know one thing, I’ll say, I don’t think happens in rejection letters in such a personal message from the President and I want to read you the guys a little bit of it, because it touched me. He said, part of the letter from President Xu reads as such: “I hope all of you remember that there’s a long road ahead of you. If we were meant to cross paths one day we will. Gaokao only makes up a small part of your life. Once you turn over a new leaf, you still have your entire life ahead of you waiting to be explored. Please be positive and confident along your journey in life.” Zhangwan:What a nice president of university.Ryan:I love that. He says you know what, this isn’t the make or a break, this doesn’t decide your life, pick yourself up, dust yourself up, you are meant to do something.He Yang:That is so nicely said and I think that’s something, it’s a bit heartwarming. So understand why some of these parents got kind of emotional and students as well, but also I’m puzzled this is something, maybe not so personal, but denial letter, rejection letter written in nice words. That’s something that in the UK, the US, it’s common practice for all universities, but why is it such a novelty in China? And people cry over this, because “Oh, this university so thoughtful for once”.Zhangwan:Yeah and because it’s rarely seen here in China.He Yang:And why is that? I think sometimes it’s about you know feeling for the other party. I think service needs just one extra little human touch and it can just make things so much better.Ryan:Right and I think I can’t speak for China, but being from the US, this is like as I said a common practice. And I think that’s something to do with encouragement. In our culture, if you fail, people don’t put you down. They try to help you say “Hey, you can do better next time and this failure was just a small bump on the path of your successful life story and how you made millions and you’re rich and you’re awesome and we wish that for all of our Roundtable fans.

He Yang:If you live far away from home, you may get homesick and if you feel happy while your parents visiting you. But a recent survey shows that half of young people living outside their hometown in China do not want parents to visit them at all. Why is that? What’s going on?Yu Yang: Well, according to a recent survey from the social survey center of China Youth Daily, it shows that 48% of the interviewees living away from home do not want their parents to come to visit them. Over 8% of them said they mind this very much. Among the 2002 interviewees involved, over 54% think lacking time and energy accompanying their parents is the main reason. And 67% respondents believe that people should pay visit to their parents’ home regularly. That makes sense to me. And 64 % of them suggest young people communicate with their parents more often.Ryan:Yeah. Mom, I didn’t take part in this survey. Just throwing that out there mom. You know, looking at this, I think on some levels yes, if I am going to be very frank, it makes sense. If your parents come to visit, let’s take me for an example. If my parents come to visit me here in Beijing, I have to take off time, I’m still in Beijing, yet, it’s a new experience for them. You know and of course it’s really nice, I’d love to show them around, she’s been here a couple times. But yeah, at the same time, it is very stressful for you, you know you are showing them around and but they are the tourists, you are not necessarily the tourist. This is your vacation you are using, well, you probably also want to be the tourist during your vacation. I think that’s understandable. But guys, keep perspective these are your parents you wouldn’t be here for them, they love you very much, enjoy the precious moments you get with them and try to put your personal “whatever” aside.Yu Yang:Time is just one problem. When your parents come to visit you, they need some place to live, right? So accommodation is another problem. Usually young people working in cities away from home, especially first-tier cities, such as Beijing, Shanghai, Guangzhou, can only afford to pay the rent of a small apartment. And sometimes they have to share rooms with others. So when the parents come for a visit, it is sometimes embarrassing for them to offer accommodation as their living space is so limited and if you book a hotel, your parents will feel embarrassed too, because they think it’s a waste of money and they think the children are not close to them any more.Ryan:Right. Imagine if they come to visit you, you know, they rather be staying with you than at the hotel, then they can spend as much time with you as possible.He Yang:Yeah and the part that I can totally understand and I also feel like even through the words when I read on the Internet about some of these young people saying that I feel a little bit ashamed that my parents come to visit me. When they see that this is the lifestyle I’m leading in a big city, it’s sort of like shattering, not only their own dreams, but the dreams of their parents to some extent. I don’ know if it’s just a Chinese thing or not, but often I think for Chinese young people, like we feel so much about what our parents, their expectations are, what they perceive for us and when they come to visit you, they think you made it in a big city, but this is what I have done for myself and that gap between reality and expectation. It just reminds you of your reality. And that’s so not pleasing.Ryan:Speaking an ideals though, I think you got so few precious moments on this earth, spend with the people you love, forget about the money, forget about the where their staying. Just as long as you get to see each other, that’s what really matters.Yu Yang: And mutual understanding. Get to know each other.He Yang:Yes, well you need to talk about your parents even it faces maybe the worst of your fears. Sometimes letting each other know, well just make the pain lessen. That’s what I think.

He Yang:A recent study conducted by the University of Massachusetts in Boston found that climbing up the earnings ladder might be harder than you think. Their results indicated that your first job’s income will determine your level of earnings in the future. So if you start off making little money, chances are you’re stuck there. Well, this is a study that looks at the American’s story, but let’s go through it and see if it makes sense?Yu Yang:Well, according to a new study, individuals employed from the 1980s to 2000s are having a difficult time moving up the income ladder in the United States. And according to Michael D. Carr , who did the study, “It is increasingly the case that no matter what your educational background is, where you start has become increasingly important for where you end. The general amount of movement around the distribution has decreased by a statistically significant amount.” Ok, that’s pertinent simple language. The theme of the whole study is if you are poor at 20, you might be poor for your whole life. I hope it’s not true.Ryan:Oh, I disagree whole-heartedly with this actually, upon really looking and getting into this research. At least for my point of view, I see this as, you know, this doesn’t even apply to me, because into my twenties, into my mid-twenties, I was pursuing higher education. So I wasn’t really thinking about a job. At the same time, the reason why I think this is happening is because higher education is becoming more and more common. So you need something else to make you stand out. Those middle-class jobs now are harder to get, so if you just had your first job with working at a grocery store, that’s not experience, I’m sorry. If you want that, what we call in the US , a big kidjob, then you need to have experience relevant to that field as well as the higher education. And I think this is becoming something now that people, this is becoming that common knowledge now that people are starting to get.He Yang:And also I have a question regarding to the study that is if it looking at the individuals employed from the 1980s to 2000s, and its what year now- 2016, what’s the end job for these people, we haven’t even reached that time slot yet , so I don’t really get that this can determine the end, because we don’t see the end yet.Ryan:Yeah, imagine the 1980s to the 2000s, so much has changed in between that time. Take a look at the phone from the 90s to your phone currently now, it’s so different. How we operate, how business is operating, the emergence of apps, the world is changingfolks. So this kind of large datasampling, I also think, could lead to some problems.He Yang:And what about the Chinese story here?Yu Yang:Er, the Chinese, it reminds me a Chinese proverb like 三十而立，四十不惑. We Chinese usually say that when you are thirty, you must have established your career, your family and when you are forty, you are no longer perplexed to buy any confusion. But I think it applied to the older generation, because nowadays as Ryan said, the higher education is becoming more and more common. In your thirties, you might be pursuing a PHD degree, so it’s normal that you cannot super rich at twenty, because you are still a student and limited financial resources.He Yang:That’s true, but also I see that in today’s Chinese society, social mobility has become an increasing stagnant for today’s Chinese young people. And that is a huge social issue actually. Because I think this is not a study, maybe I think we cannot agree whole-heartedly, but I think itpoints are attention to the stagnation and that is a problem.Yu Yang:Yes, let me pick one sentence by a netizen, I think it’s very interesting, “Poor at the age of 20 is normal. If you’re poor at the age of 30, you’re not working hard enough and if you’re still poor at age 40, then it’s hopeless.”Ryan:Totally agree, twenty to thirty isestablishing yourself. Don’t stress it, enjoy your life, try to establish yourself, get those skills, get that experience, come thirty, that’s when the alarm needs to go off.He Yang:Woo, the alarm needs to go off. AndJamie, our Wechat listener says I totally disagree with this. Asmy first job, I was only paid 800 Yuan, but now my current annual income is 500,000.Yu Yang:Wow, very inspirationalHe Yang:Yes, that’s from first-hand experience of our listeners.

He Yang:Fanfiction or 同人小说 is when someone takes either the story or characters of a certain piece of work, whether it is a novel, TV show, movie, and just creates their own story based on it. It is often inspired by fans who feel that the plot is incomplete or just want to see a happy ending between their favorite characters. Why is fanfiction so popular in China? Niu Honglin: Well, according to some writers that the reason they write fanfiction is purely from the love and a feeling of regret for the characters. Basically, people are starting to read or see some TV show, movie, et cetra and they feel like they want to see more, they want to know more about the beloved character. And that is sometimes when they step in and make their own plot here. And Jin Jiang Wen Xue Cheng is a popular fanfiction site for probably female audiences more likely. And it hosts a third Authors’ Forum on anniversary this year and hundreds of authors are coming from different parts of the nation to attend this meaningful event to meet and greet their fans. And those authors includes those that write fanfiction, maybe only fanfiction.Ryan:You know I get this, ok, I do, guys. Although I’m not, I don’t know.He Yang:Do you? Are you too cool us, Ryan? Niu Honglin and I He Yang, we’ve read these thingsRyan:Alright. Can I finish?He Yang:Sure, go ahead, sorry to intrudeRyan:Harry Potter, alright, I’m not following this whole Voldemort Harry Potter, Ithink that’s some weird stuff going on. But hey, if it floats your boat, I don’t judge. But one thing that always starts honestly should have happened and aroad, I would like to be seentaken is Harry Potter and Hermione, dude, I want to see them get together. I thought, even J.K. Rowling, I believe that she had commented after finishing these series that it was a mistake to have Harry and Ginny end up together. And actually she would rather head it the other way around with Harry and Hermione. So I can see how the allureof fanfiction could come into play here. But also I can see the problems with copyright, guys, because sometimes, this is somebody else’s intellectual property. It wouldn’t have come to fruition, if J.K. Rowling had it thought of the universe Harry Potter. So I think, A. if you make money off this, you need to at least pay some kind of royalty and have an agreement with that person, you created this universe or otherwise just offer for free. That’s my twocents.Niu Honglin:Yeah, there are some fanfictions that they use characters from other novel and they started to have their own story in the completely different time and different place and when the story is very popular,they started to make it, make it to change the name of the character and publish the story. I’m talking about 50 Shades of Grey here.Ryan:You mean 50 Shades of Gross.He Yang:Ok. Some of the stuffs is a little bit off limitsNiu Honglin:I’m not promoting or against anything, I’m just trying to say that 50 Shades of Grey is originally a fanfiction from the Twiliight series. So you can see that some of the fanfictions are actually what you have said they use the same universe, they’re using the same characters to develop different kind of story. But it is possible that they just, because their love for the characters are too huge that they just using the character to start another story.He Yang:Yeah, I can totally relate tothat character pairing is the technical phrase for it and it is the most essential part of fanfiction that gets all the fans, like I have said in Slam Dunk, Liu Chuanfeng has to be paired with Xian Daozhang.Niu Honglin:I can totally see that it’s justso hot.He Yang:Exactly. He does not belong to any girl.Niu Honglin:No, no, no, no.He Yang:So is that a kind of passion that I think fans get so much fun reading from another fan, that’s writingthis, answering to our desires.Ryan:I get vibe that this has a very big like desire and people really, girls seem to really like this for the pairing possibilities.He Yang:Don’t gender stereotypeRyan:Ok, fine. But I mean you just mentioned 50 Shades of Gray and Twilight. Ok. Fist of all, I will admit, I have seen Twilight, ok, with guy friends in a movie theater. Ok, I’m not proud of it, but I had to see whatall the rage was about. Ok, yes. But I think I only saw the first two, but I never seen 50 Shades of Gray. I know my mom and my sister love it and talk about it for hours, but at the same time I have heard what it’s about and it’s not for me, so I can’t, definitely can’t tell if the two are related, cause I don’t know them well enough. But if people are getting so much enjoyment out of it, is it such a bad thing? That’s my question.He Yang:It can’t be a bad thing.Ryan:It can’t be a bad thing. 50 Shades of Gross, come on, people love it.Niu Honglin:Ok, about the thing you have mentioned about, a copy issue everything. I’d like to say that it is actually a fact that most of the fanfiction writers don’t get paid or publish their works. They’re just doing this, sometimes from pure love. But if it got really popular, I do think there should be a standardized procedure that allows you to discuss with your original writer and talk about things, make arrangement, make deal out of somewhere to make sure you’re getting paid in a good way. Ryan:Yeah, I think if you are writing a good fanfiction and offering it for free. Eventually, you know you’ll get following and then wants you write an original content, maybe you could make money off of that. So I think it’s a good way to begin as an author.He Yang:Yeah and we have seen there some successful examples of fanfiction writers become real writers and understand there’s a lot of junk out there. But when it’s free, that’s what you get and also that is, I think the beauty of the Internet that anybody could technically, I mean publish online, but whether you be able to gain that huge group of followers and capitalized on that, it takes a lot more work and also get the legal issues sortedout before hand.

Heyang: Now, Let's talk about a boy's topic I suppose. A recent report shows that among adults, men are buying more toys than women. Why is that? So, what are we talking about here? The toys are like transformer stuff…those kind of toys, right?Niu Honglin: Yea, it is like every kind of toys involved. Oh no, not every. The transformer of course, the robot…or maybe what is boys and men favorite? And also some men and, let say, not in big cities, it shows up that teddy bears are the most popular in second, third and fourth in some cities. So, yes, teddy bears. But I like to assume that they are buying that for their girlfriends or something. Ryan: Hey guys, it is pronounced "Trans-form-er" okay? It's Optimums Prime. Come on guys! I am sorry for all the male listeners out there. They just don't understand guys. Well first of all, I think it is obvious that there is plenty of data to show that basically, when we are buying teddy bears, it is not for us, it is for our special lady.Niu Honglin: Apparently? Really apparently? Ryan: I think so, but definitely, definitely the transformers are for us. But, basically, you know 65 percent of toy buyers are between, in the survey, are between 23 to 35 years of age. And so, it is bringing up a lot of questions for the older guys why are they buying toys. You know what? I went to the comic con and I looked at all these really cool toys, but I could have appreciated the artistic-ness in them, and it brought back this nostalgic feeling. So I think a lot of guys buy this stuff to remember their childhood. Not necessarily, they go home and play in the living room, with their transformers. Heyang: Okay…really?Ryan: Yeah! Come on!Niu Honglin: It is okay. It is nice to see a little boy inside of a man, manly man. It is fine. And I am all for it. You should have a hobby. It is like, it better than smoking or drinking. You are just collecting toys. Heyang: Yeah! Have a hobby, like play tennis. And not get some toys when you are in your 30s. Do you know what that kind of scene looks like in other ladies' eyes?Ryan: Is it? I mean. So, you say it is better than reference smoking okay. Another thing that is better. But, if you went on a second, third date, you are going to watch a movie at your new found boyfriend's house, and you just see action figures everywhere, wouldn't that scare you to pieces? I mean it is just a little weird when it is like a dramatic thing. But I do want to say that probably most these guys are buying it for nostalgic reasons. So ladies, don't hate!Heyang: But why is it that, I mean nostalgia is a common feeling shared by all human beings, but girls don't buy toys. Why is it that men are buying those stuff? Ryan: Are you kidding me? I feel like girls definitely do buy toys. I mean I feel like Hello Kitty is huge. It is huge maybe in Korea, and a lot of places in Asia.Niu Honglin: Um…let say that we like them. It is okay if we need something that they are in shape of a Hello Kitty. It is okay to buy those, but we don't collect them. Well, at least, I don't collect them. And also, I am okay with it cuz it is nicer and easier to pick a gift.Ryan: Also you are going to make fun of guys for our toys. I just want to say on behalf of all our guys that why do you guys have so many shoes? Heyang: Because we need to wear it! But we don't need to play with it and you are playing with your toys when you are in your 30. And you have a whole group or cabinet of action figures? Yes, I understand those are collectables and they are like merchandise. And in some cases, they can actually become a sort of investment. But that is a mystery to me. How come, still you know guys…can we just simply say that boys will be boys forever? And I don't like that line at all because it sounds like an excuse! You are listening to Roundtable!

【特别感谢热心听友“Maggie 欣欣”帮忙听写本篇文稿】Heyang: Is learning English a long, boring and tedious process? The answer is probably yes for a lot of Chinese students. But a fun change is taking place in a middle school in Chengdu, Sichuan province, where students can learn English by playing mahjong or 麻将. Is it possible to learn English in an entertaining way?How does it work, guys?Yuyang: Yeah, this is really interesting. A set of English mahjong tiles invented by a middle school principal in Chengdu has gone viral in China. Of course this is different from the traditional Chinese mahjong. And this set of mahjong is English ones. The 26 English letters are stuck on the surface of the tiles. Students have to combine the tiles into words, and whoever composes a sentence with the words wins the game. Meantime, Students can also play poker and weiqi (or Go) in classrooms. Of course, these pieces in students&`& hands are in English alphabets. Such fun time for students!Ryan: You know when we are talking about this, I imagined maybe a teacher or a parent walking into a room when their kid was in there. There were three other friends smoking cigars, drinking 白酒, and playing this. And their parent’s like ‘what are you doing?’ Then they are like ‘learning English’. But maybe that gives you a point of where I’m coming from. I think that…I don’t know a lot about mahjong, but maybe I can compare it with poker. And that in my family I wasn’t allowed to necessarily play poker until I was of a certain age because there was a heavy gambling context associated with that game. And so when I’m thinking of this, yes, the good is there that people are learning English and I think it’s really cool to learn English in a fun way. But at the same time I think this is still relevant in that they are playing game that’s commonly used to gamble with and that could have some effects on them.Heyang: Yeah, and actually that is a really worthwhile concern, I think. As mahjong for me, I would have thought it’s sort of just entertainment for the masses and I wouldn’t necessarily connect it with gambling coz I’ve seen older folks play mahjong and instead of money, they use like 瓜子儿, you know like sunflower seeds to replace the money or…you know there are many ways to play it. And you see in so many places in China that it is a really important item in the entertainment list that people have. But I think it’s really interesting that a teacher is actually connecting the two, learning English and playing mahjong together. What do you think of this kind of mentality behind the design?Yuyang: Oh yeah, I think I come from very traditional background in China. But Ryan, compared to you, I was allowed to play poker from a very young age. That is about when I was in primary school. I can play poker with my parents. So I think if you can give the students safe context, maybe they can do it; they can both play mahjong and learn English without causing the parents’ worry. Well, let me explain. Let me explain the school principal’s logic in some way. Well, students have to form English words with the letters they get and then write down on their notebooks. A student wins a game after they form the most English words, writing sentences and telling a story by using the words. And the school principal says that he has calculated the frequency of letters appearing in words, and then set the quantities of each letters differently, such as having eight mahjong pieces of ‘I’ but only two ‘B’. So according to the school principal, it’s scientific design, in some way.Ryan: Yeah. You know, listening to this, I just think there is better ways to learn English and that is listening to RoundTable. Number Uno! (Yuyang: Oh yeah) Come on, folks! Why are we even talking about this? You should be listening to RoundTable as often as you can. But maybe another good personal idea is that I would say watch TV shows. Listen to how people interact, you’re learning their mannerisms and you’re learning how they speak, pronunciation and how they formulate sentences. So those are my two suggestions but like I had said before that, RoundTable, obviously, number one, folks.Heyang: Oh definitely. Ryan, you’ve just provided us with the most valuable words of today. That is, well you know, RoundTable. I can’t think of another option for you. Yeah and I think with this playing the mahjong thing to learn English, actually the idea is similar to playing Scrabble. So it’s about, you know, forming those words and expanding your vocabulary and those things. And also those mahjong tiles they don’t look cheap to me at all. It’s special mahjong tiles. And now for some reason it’s just mahjong tiles ringing in my head right now.

【特别感谢热心听友“绿云扰-王佳云”帮忙听写本篇文稿】Ryan: Yeah, I’m just gonna go right back to Heyang here. I’m just saying…... (Heyang: Sure, I’m ready.) Okay, as you are talking from you know being a woman in her twenties and knowing so much about the world and what not. But you know I should honestly say that when I was seventeen to now I wouldn’t have known like maybe necessarily I would be like oh, someone is on my phone, it’s so cool. I like I need to answer them right away I want to be cool and popular. All these stupid things going through your head and eventually realized like popularity is just all superficial and you should just be yourself. But those realizations come later in life. These are kids so someone needs to snap them on the hand and say, hey, put the phone away so that’s my spiel. That’s my spiel but at the same time you know I do want to say that I do think this is a problem also as adults we don’t have specifically those numbers. But I mean today I was coming to work and I remember walking through the subway and seeing grown-ups walking up stairs and down stairs with their phones right in front of them and they are not even looking what’s to the left what’s to the right. If something happens they are definitely not gonna be able to respond. They are able to walk in one pattern comfortably but at the same time you know imagine if someone behind them falls they can’t respond and it’s just gonna create a chain effect. Come on, it’s dangerous and people there’s a time and a place.Heyang: Yeah, Ryan, although I don’t really want to admit it but you are right.Ryan: You all heard it~Niu Honglin: What she says is right. And I think what she meant is you have to teach your kids and by teaching them what to do instead of telling them. Maybe you can be a good example. You can stop watching your smartphones stop playing games when you are walking when you are driving and that will them a sense of what to do things.Heyang: Yes, and actually you kind of read my mind successfully, Niu Honglin. (Niu Honglin: Thank you, I have that ability.) You are a very smart girl and also Ryan I think you really did hit the nail in the head with saying that it actually the adults that haven’t really been setting the best example or being the role model and they don’t really realize themselves or they don’t have a stance to say that you should get off your digital device when you are mobile when they themselves are probably doing the same thing. So now it’s actually a bigger problem. It’s not just teenagers being a bit crazy and immature and those things. It is actually a bigger picture.Ryan: Yeah, you know I just wanna…you know it’s tough because these teenagers were dealing with new things that are happening and everything is changing, technology is growing. It seems like it’s grow in the trend of we are always plugged in. We are always in some way in communication with people. But you know I would just like to say that these kids I hope that their parents crackdown a little more on them using devices while they are walking. But you know you can be one of those perfect people that doesn’t use devices. What’s really scary is if there’s some adult behind a car or something like that. Because you can be the best driver in the world or the most protective walker in the world but when you believe like someone driving a car is being a responsible driver yet they bring out their phone and texting. That doesn’t matter how good of a person you are about your walking habits. That person is also just as dangerous as you also having that phone in texting. So I think what’s really important here to and something you definitely worth focusing on is that adults especially because they can do more things like driving and what not need to better about choosing the time and place to use these devices.Heyang: Yes, that is a very good point and also echoed by one of our WeChat listeners Mr.战神. He says: I avoid using my smartphone at home because I don’t my daughter to copy my behavior. (Niu Honglin: That’s good parenting.) Yes, and he also says actually I can live the weekend without it. And 战神 I can totally agree with you because I do that all the time. (Niu Honglin: You people are amazing!) And also he says while walking I don’t listen to this amazing show called RoundTable. I only do that when I am sitting down alone because when you are walking in the street and you’ve got the earphones in your ear sockets then it’s bad for your listening ability and you could be in danger when you don’t notice. Those are some really good tips.Ryan: They are some really good tips and awesome parenting showing by example I love it. But he mentioned the headphones you know I’m not gonna lie to our listeners because they are wonderful and I want to be very honest with them. I do listen to my headphones not necessarily when I am driving but almost never when I am driving. But like in a subway when I am walking around to transfer and what not. You know that’s I feel like I can handle that and I can respond to situations visually but at the same time I can understand where he is coming from and saying you are impaired without hearing. Niu Honglin: Yeah, and also one of the dangers we are not saying is dangerous places but some place you should not listen to music or whatever. You are crossing the street or at a street corner or you are in a driveway or a parking lot that’s the places that you need to watch out.Ryan: Niu Honglin nailed it on the head there I totally one hundred percent agree. I think like you said use your discretion but when it’s traffic related crossing streets especially you are driving those cars, guys, devices should not be the first thing on your mind, it should be you know should be safety and protecting those around you.Heyang: Yeah, very nicely said and also if you are really that desperate to stay in touch for those people that are just not worth it anybody, then just take a minute I think just stand still and move to a corner to a safe place in the street and finish your texting or whatever you are doing on your phone and then resume your walking after that, if you are really that desperate.Niu Honglin: And from a personal experience that will give you a high efficiency even though you are playing a game just stand there, stand in a safety place and play your game do whatever you want they will give you better experience.Heyang: Yes, that person can be stuck there for minutes if not in an hour I’ve seen that happened to. But that’s the safer way to do and everybody just stay safe alright? That’s what I want to say and before we move on to our last topic of discussion today, Ryan you are getting all the nice messages today. (Ryan: You guys are so sweet. Keep them coming.) You are just asking for more and our dear listeners seem to feed more into your ego.Ryan: Because we love each other, Heyang, that’s how it is. (Heyang: Alright, I get a little jealous sometimes.) They don’t understand guys, or she’s doesn’t understand our love guy, but that’s okay. Heyang: I understand a little bit, a little bit and there is Linka, maybe that’s your name, and she says, Ryan always has a nice point, smart guy. Being called smart, that must make your day, Mr. Ryan Price, right? And there is naxiaoning says I agree with Ryan, kids are kids, don’t hold them the standard of adults. I am crazy when I was at that age. So thank you for sharing that comment and agreeing with Ryan. When can someone agree with Heyang? There is 那朵小花 saying this is my first 弹幕 biu message, love you Heyang, your voice lights my day. OK, that’s so nice of you.Ryan: I also love Heyang, guys. She is awesome. So I’m right there way with you.Heyang: Oh my goodness, thank you for saying so much nice things to me. That is really cute of all of you.

【特别感谢热心听友“​Maggie 欣欣”帮忙听写本篇文稿】Heyang: We’ve all done it: when a conversation gets boring, we pull out our smartphone and start playing with it. This is been called phubbing. But apparently, Chinese teenagers are taking it to the next level: as a new survey found that 60% of teenage pedestrians are on their smartphone as they are walking in the streets. It is okay?Guys, what’s going on here?Ryan: Oh goodness. Let me tell you all about it, okay? A survey released by non-profit organization Safe Kids Worldwide with the support from FEDEX, So it bit sounded like Fedex but I didn’t want say that because there’s a delivering company called Fedex, found teenagers are often distracted by the use of electronic devices while walking, which can cause traffic accidents. So it’s been revealed that 93.1% of students surveyed in a survey possess smart phones. 60.9% of those surveyed said they got distracted by the use of electronic devices while walking. And nearly half (45%) of the respondents admitted that they themselves or their friends and family have nearly experienced pedestrian clashes while using smartphones, tablets or gaming devices. So here are, you know, overwhelming amount of these people that were surveyed, the students have phones, and more than half of them are getting distracted while walking using these devices at the same time. Another question I would like to ask is like those who do drugs these students or even, you know, younger adults that do drugs was the number of people that use like phones when they are doing that on a scooter or in a car, also a good thing to look into I think.Heyang: Oh that’s very interesting.Niu honglin: And actually I don’t think it’s limited to teenagers I think adults also do that too. They also walk and drive and do everything with their cellphone and actually in some metro places and malls they have this warning, like saying you should not use your phone when you’re on the elevator or when you’re walking. They have this because more and more people are doing that. That’s why they’re warning people not to.Ryan: Yeah. Okay so let’s talk a little bit more about the survey coz I’m sure some questions are being asked about that. So basically they surveyed 1000 middle school students on their pedestrian habits. The students came from 10 schools in Beijing. Apart from that, the kid’s safety advocacy is measuring the risk of these students walking through school zones. And you know, a lot of these distractions, you probably say, ’what are they doing’ Well of course maybe they’re using like, messaging friends, they might also be listening to music and making phone calls.Heyang: Yeah and it’s really interesting that you guys keep on saying,’ all these kids are being distracted or adults are being distracted when guys, I don’t agree with you at all. That sounds like you’re shifting the responsibility of walking safely yourself to digital device? No way! It’s you putting this on yourself. Nobody is distracting you. It’s because you don’t have the ability to say no to stuff when you should have. That is my opinion and these guys are kind of shaking their heads in front of me so they don’t necessarily agree with me. But they get a chance for their rebuttal right after the short break. The part that I feel very passionate about is I don’t think you’ve got anybody to blame or to take this as a distraction. It is just you putting your safety second (Ryan: Yeah) and putting your digital device first. What is wrong with you?Ryan: Oh yeah~ I got some information for you, Heyang.(Heyang: Yeah~) Okay, so, pedestrian injuries among 15-17 year olds account for 37.24% of all pedestrian injuries among children 17 and under. So I mean, I would say that these are kids; these are tiny kids and so much of them are this group basically 15-17 year-olds. They are not adults so I don’t believe we should hold them to the standard of adults. They are still very much kids and I think there’s needs to be some parent guidance here and that is you know, like when I was a kid I would run across the street like a mad man I could even think I would dodge traffic like I was invincible, you know. Even probably well on to 15 if my mom hadn’t said, you know, lay down the ground working. She said Ryan look both ways before you cross this street. Always wait till you have a clear, you know, no problem zone to cross. You know these kind of things, but basically we’re seeing a lot of these injuries are happening with kids.Niu honglin: I agree with you when you were saying they need some guidance and they need someone to tell them they’re not doing it right. But you have to know their reasons when they say they do not want to put their cellphones down it’s because maybe they’re listening to a song that hasn’t come to an end and they say they wanted to keep company with their friends in the internet and they don’t want to make the other party unhappy and the third reason which I find a little ridiculous is that they do not…they simply do not want to stop playing.Ryan: Right you said you find this ridiculous. Well I can’t speak for China; I don’t know the specific rules but you’re not considering an adult in the U.S. until you’re of 18 years of age. So these are kids. And of course they are ridiculous. Kids do ridiculous stuff. They don’t know any better and what I’m saying here to both of you but especially Heyang I’m pointing my finger at you, girl (Heyang: What’s up?) I’m saying that you can’t hold them to the standard of adults. I think if this was a different survey and we found that these were actually people who were considered adults. I would agree with you. But these kids need guidance and basically tablets are more available now than ever and kids are getting them. So parents need to join the current situation we’re living in right now and be able to tell their kids, ’Hey, while you’re walking, put that phone away.Heyang: Yeah, I think it’s interesting you make that distinction, Ryan. But I just don’t think a teenager of 17 years old or an adult of 18 years old are that different. I just feel that for these…Okay when it comes to legality I have to agree with you, Ryan. But when it comes to using your smartphone and ditch it when you should so you can stay alive and don’t walk into a tree or get hit by a car or walk into a manhole and fall into whatever stuff and you could lose your life then I don’t think that it is an excuse to say that I just want to stay connected. That’s just not good enough.Niu honglin: Well, I would like to take a little step back and say that maybe it’s because when they’re still kids when they started to…( Heyang: Teenagers! We are talking about teenagers now!)Yeah, I’m trying to say when they’re still kids and they don’t know how to see the world. They don’t know how to think about things. Maybe their parents didn’t tell them about the devices because they don’t have it back then. And now they have this and maybe they don’t have a right way of thinking things and seeing things now.

​【特别感谢热心听友“Mobey 曹英哲”帮忙听写本篇文稿】Heyang: Some believe that one’s personality can alter the course of one’s destiny. But do you believe that your personality can affect how many birthdays you celebrate?Of course, it’s important to remember that there are many factors, from genetics to lifestyle, work together to determine life expectancy — but researchers have found that there are six personality traits, in particular, some are more common in those who lead longer lives. Guys, what does the study say, do you believe in this six indicators that could contribute to how long you live?Yu Yang: Well, this is a really interesting research, because the researchers used the data from a 75-year study of 600 people, who began taking part in the study between 1935 and 1938 when they were in their mid-20s and continued the whole participating process until 2013. When they joined the study in the 1930s, each participant picked three to eight close eight friends to rate their personality using a 36-question scale created by the psychologist E. Lowell Kelly in 1940. Using the questionnaire, the researchers end up with 4 key traits that emerged as key measures as longevity. And two for women and two for men. Of the men in the study, those who were seen by their friends as more ‘conscientious’, which means they were less likely to take risks and also tended to be more thorough and efficient, and open to new and different ideas, feelings, and concepts lived longer. Of the women, those who were seen as more emotionally stable and agreeable lived longer.Ryan: Yeah. I was looking at this, and I think it boils down to, for me, these are just really technical terms to say, don’t live a life that is stress-ridden. So a stress-free life, you live longer, and I think happiness, that ambition, that drive that tells your body life is good, let’s keep this run going for as long as possible. I think your body does directly respond to you, if you’re hating life, if you stressed everyday, it’s like the worst day of your life, your body’s probably, it’s that mentality’s taking a toll on it some way. Like let’s take the guys for instances. Conscientious, which is the best predictor of longevity when measured in childhood, is a personal indicator of long life measured in adulthood. To me, conscientious means like people who create healthy, long life pathways for themselves, and for me, at the same time, I think that is hand in hand with a stress-free life, also being open, not opposing change, everyday is a change, and so these people that were started this what the 1930s, a lot has changed, if they fight it continuously, they’re gonna get tired and worn out, and of course, probably won’t be living as long life. But if you open the change and you are conscious, you think about things like, oh I should set my alarm or worry about the little details in your life, those little details won’t come back to bite you in the rear end, and you will be less stressed, you can relax knowing that you covered all your basis and that’s what it means for me, maybe you guys can talk about the lady, the two lady words.HY: Yeah that could be possible, but also I just think conscientious is really interesting coz it’s sort of telling you that you take small risks maybe, but you avert most of the risks, is that what kind of means here? Ryan: Well, also, detail-oriented which to me means someone who doesn’t just like go through life, and like doesn’t pay attention to small things, looks through things in detail, and make sure it’s done maybe correctly, but also at the same time, you could say, like, thrifty and persistent, but those kind of people I believe they have less of that karma from doing half way jobs comes back to bite them in the butt they live more stress-free lives. HY: Oh interesting. Coz I used to think that would be... Because these people sound like prudes.Ryan: Oh... She said it. You guys heard it. She took off the gloves. But...HY: I mean I’m just throwing it out there…Ryan: Oh you threw it in my face. You can just throw it out there. Alright, you know I’m just gonna say this. I think someone who does take that detail into serious account will live a longer life in less stress. Now please, this is the man words. So let’s talk about the lady words.YY: Yeah. The emotionally stable thing…I think I agree with this point. It’s not a gender topic but maybe because women are more influenced by emotion than their counterparts. And according to the research, the emotional status can affect women’s hormone and endocrine. Endocrine means “内分泌” in Chinese. This one I totally agree. So, well, I think women are more susceptible to the endocrine imbalance(内分泌失调). Well if you suffer from that, that’s a problem. So I suggest to keep your emotions stable as much as you can, and agreeable and friendly and being nice, well, that’s kind of ideal situation, but life is hard sometimes. Or I think Heyang you have something dramatic to say about this trait.HY: I have nothing dramatic to say, I just have something pretty rational to say. That is I think emotionally stable should be what men and women try to pursue maybe. I don’t see why this is strictly a gender thing that is my question, coz when it comes to hormones, come on everybody, male are more susceptible to it or if not we’re at a similar levels, I think it’s sort of gender stereotype to say women are just more emotionally going through ups and downs and things. Ryan: Well, ok, I mean that’s a whole separate argument I feel, but there are inherent differences in men and women especially in brain chemistry, I believe that there is a good argument in that. But at the same time, I do agree with you that emotional stability is not a gender specific thing. And so everyone should strive to be emotionally stable, but what do you think about agreeable and friendly like?HY: Well, I think it’s sort of creating that happy atmosphere around you, coz I think automatically if that is around you, then it makes you happy, it would work for you and maybe spreading a little bit love on the way is not a bad idea, either. And also it seems like being an extrovert can help too, so I think it goes back to being open and those kind of things.Ryan: I was just gonna say for me it’s common sense, I totally agree with you.HY: Alright~YY: Really I think I’m an introverted person, I can handle stress pretty well. HY: Don’t forget that these factors in play together.

Heyang: A recent online survey shows for that many young parents after giving birth to a child that’s when more trouble ensues. Apparently, young Chinese parents leave the responsibility of raising kids to the grandparents. Is this okay? What is going on here?Yu Yang: So this online survey of China Youth Daily shows that, raising child is now a problem for many young couples. According to the statics, 58% of the respondents believe that it is very common to see young parents not taking the duty of raising their child. And 61% believes that great pressure from work is the main cause of the phenomenon. Nearly half of the respondents say they may consider about quitting the job, or at least their spouse to quit, if there’s no one to help. Nowadays it is very common to see grandparents or nanny hired to take care of the baby.Ryan: Yeah, looking at this, this is something foreign to me. Just because I’m from the U.S., I feel like this is something that is maybe acceptable here. But in the U.S., I know if I did something like this, my parents would not be about it. They would say: “That child is your responsibility. Don’t expect us to pick up things you are do in your life. Like we already did it. We are done with it. We are ready to chill and enjoy other years of life that we have left. Now it’s your turn to be the parents. ” They would also probably say that is a privilege and something would be so memorable. She always tells me the best days of her life weren’t when she’s at work. It was her stressfully making time so that she could catch the little performances we did at school, and be a really part of our lives. So looking at this, I can understand people are busier and busier as the years go on, it seems. But at the same time I think you should try to make time in your life before you have kids so that you can be of more presence in their lives.Heyang: You make a really good point. I think you show a different perspective really, and that is very much cherished on this show. Let me just play the role of the brat, spoiled young Chinese person considering having a child or not. “Well, mom. If you say I must get married. Okay, I’ve done that (in this imaginary world). And now you want to have a child. All right I’m giving that to you, since it is you that asked me to do all of this and want this child. You have a part in raising it too.”Yu Yang: That’s typical Chinese scenario!Heyang: Right?! Okay, buy the way, that was all acting. I still don’t even have a boyfriend. So Yu Yang, tell me more about it.Yu Yang: well, I think one reason from the young couple is huge pressure. The other reason is these young couples are mentally immature and not independent enough. They rely on their parents too much. It’s a habit for them to rely on their parents to do everything, even taking caring of the baby. I agree with Ryan that if you can’t take care of the baby, just don’t have them. But in the Chinese scenario, they are pushed by their parents.Heyang: Sometimes.Ryan: yeah, so I speak for my sister and her newly wed husband. I think they got married last year. I know that sounds awful, but anyway I do remember their wedding and they are very happy newlywed couple. But they are so busy doing things together and wanting to spend time together. At the same time, they told me that they will only have kids if they know they have enough time to give to the kids. Otherwise they don’t think it’s fair to the kid to have them. A lot of us in the U.S. , what we do actually in a lot of relationships and what I plan to implement in my life is when I meet that special girl, and I’m like “ yeah, girl, let’s think about having a kid. But first let’s get a dog, a puppy. Because the thing about puppy is they are really hard to take care of. It’s almost like they have to be watched, all the time, like a baby. If you can pull that off successfully without killing each other and maintaining your work life. Well then maybe you are ready for the next step: the baby.Yu Yang: There are some potential problems for the grandparents to take care of the baby. The child willbe easily indulged by the grandparents.Heyang: That’s true. When you are the parents who are not happy with what the grandparents have done in helping you out, to raise your kid, then I seriously don’t think you have any place to complain.

感谢热心听众【绿云扰-王佳云】对本文稿的贡献。Heyang: You are listening to Round Table. They pick you up for an early flight. They give you a ride home after late-night out work. The headlights of their cars warm up your heart on a windy night, and that ambiguous smell inside sends you straight to vomit hell. Let’s talk about Chinese cab drivers. This is inspired by WeChat account “Shameless”. They’ve got some good stuff there. But yeah, guys tell me more about your experience of all those years riding Chinese cabs.Ryan: Yeah, so I mean this “shameless” account breaks it down into five different categories of cab drivers. And I got to say that I definitely have a lot of stories considering this one kind of cab driver, The Raging Racer. And these guys drive fast. They are almost drifting in around corners and stops. No, I’ve never had that kind of experience. But I definitely have had cab drivers that are very aggressive drivers. And you know what? I liked it. I got to say I am a big fan of the raging racers. I remember one time I used to work on a Beijinghour we did a morning show so I’d wake up very early in the morning to get to the studio in babaoshan. (Heyang: How early was it?) Guys, I had to get up at 2:30 am, OK? (Heyang: 两点半 in the morning.) Yeah, and I live near Gulou so there is always taxi cabs there. But anyways I got one and this guy drove so fast and I ended up getting to work in the split nick of time and I was able to have a relaxing siesta on the couch before starting my shift even though at times I was a little nervous. But…..Luo Yu: Is it a bit scary for the driver to drive all the way from downtown Beijing to Babaoshan at 2:30 in the morning?Heyang: What’s scary about that? Luo Yu, let’s just let that out. Let’s just let it out. Why is it scary?Luo Yu: Because we’ve got the best cemetery here in Beijing.Heyang: Yeah, the cemetery, yeah, the graveyards.Ryan: I’ve definitely had like also what they called a road robber who wants to take you on the trip through all different areas of Beijing. So in these many mornings that I have commuted to babaoshan I have gone through many different routes. My favorite route though was of course going through the Forbidden City and Tiananmen. There was an amazing view. (Luo Yu: Is that going through?) (Heyang: Changan Avenue.) Changan Avenue, driving you through Changan Avenue is beautiful at night and I highly recommend it. But there also take like a bigillion other different ways. So apparently there is like a bigillion ways to get to babaoshan from where I live. But my favorite is Changan.Heyang: 长安街，yeah, Changan Avenue. OK, and I think talking about road robbers our listeners have something to say. PX says that there was once that you know she came back she wants to go into the city from the airport and every time the cab driver is being really really annoying and they just want to get the most money out of a trip from the airport to ……. OK, Luo YuLuo Yu: Tell me more about it. I used to live very close to Beijing Capital International Airport. You know it’s not walkable distance so I have to take a cab but I felt humiliated millions of times. Every time when I was hailing the cab and I said to the driver, “Sorry, I’m so sorry, shifu. I live nearby. I’ll give you…… ” Well, the fee is only fifteen kuai, starting fee, but I have to give him an extra twenty kuai. And he said, “Do you think twenty kuai compensation is enough?” So they don’t consider you as the valuable passenger. They just turn you down on most occasions. That’s happening a lot in a lot of cities in China.Ryan: Yeah, you know so we’ve talked about the road robber, we’ve talked about the raging racer, but there is also one that is called The Zero Sense of Direction. I’ve definitely had my fresh year though the other…… (Heyang: No way! A taxi driver should know the way, right?) The other night I was with a friend and I was coming back to my place from near like shuangjin. Anyways, I was trying to tell the cab driver, hey, like it’s north, it’s north, but for some reason he kept saying beixinqiao wherever was a complete different direction. We got very mixed up so I feel like even maybe I have the zero sense of direction. But I thought I was like spot on about where we needed to go.Heyang: Yeah, apparently the situation has only gotten worse as Uber and Didi are you know…Luo Yu: But they’ve got GIS and GPS inside the car.Heyang: Yeah, and I wonder if it’s OK. Well for me I think it’s fine if a taxi driver doesn’t know the way then just turn on the GPS. But that has changed. In the old days in Beijing when I was a little girl that was a long time ago I’d to admit. OK, I’m not that old anyway. Stop laughing at me! If you are laughing with you are forgiven. OK, alright, so bad thing it was….. I love non-local people as well alright? But back then it was all old local Beijinger taxi drivers and they would talk about as if they’ve just had dinner with Jiang Zemin or Hu Jintao the night before rubbing shoulders with them. And also they know the road and they know every shortcut through every alleyway. They can be the raging racer, too. But they know the way and that is the most important thing which I do find these days becomes increasingly a luxury that a lot of these non-local taxi drivers they just don’t know where to go.Luo Yu: They can’t even speak mandarin as they are from outside Beijing so their Putonghua is not that good.Heyang: OK, not as standardized but you know you can pretty much understand but they don’t know the way and that the most annoying thing for me. OK, most annoying thing for you.Ryan: Sometimes the music. Sometimes the music I heard some great music in cabs and I heard some music that I was very confused about. But you know I’ve noticed that there is a quite different array of music. (Luo Yu: Like 凤凰传奇, the legend of phoenix.) There are different array of music being listened to in taxi cabs which is another criterion for one of the kinds of taxi cab drivers.Heyang: Yes, definitely. And I like to finish off today’s show with Bob’ comment. He says he just scolded a taxi driver because that dude was eating instant noodles, cup instant noodles, and just threw the garbage out of the window and that’s not some behavior he can condone and I totally understand that.

【特别感谢热心听友“Coco 鄢文琴”帮忙听写本篇文稿】He Yang: A global survey found its coffee and ketchup that holidaymakers consider their packing essentials, rather than flip flops and suntan lotion. It’s also showing that nearly 40 percent of Chinese mainland travellers pack instant noodles with them. Are you one of them? Guy’s, please tell me more about the survey and what’s up with bringing food from home when you are travelling?Ryan: Yeah, a survey of travellers from 29 countries and regions have revealed the top unexpected items each nationality takes abroad, ensuring that wherever they go they have a taste of home with them. The study are looked at, it was by a Spanish travel company, surveyed 7,500 people from around the world ensuring that a minimum of 250 locals had been interviewed for each country. Now, looking at these, I think, some of them are pretty silly. So, maybe if we have some French listeners you guys can clear this one up for me. But bringing cheese, 53 percent French people said they would bring either cheese or dairy products. Guys, don’t dairy products go bad like, how are you going to refrigerate that, that seems more a problem, more trouble than it is worth.Luo Yu: Cheese have gone through four fermentation processes already, so , it won’t decay. He Yang: It won’t to decay, but it will smell bad like baby diapers. And Chinese people tend to bring instant noodles, that doesn’t smell. But I don’t get it, if you are travelling, then aren’t you supposed to try the local food. That’s part of your travel experience. Why bring instant noodles?Ryan: Define travelling, what if I am going to my parents’ house on Spring festival and I want something to eat on the way, on the train. That makes sense!Luo Yu: And What if there was a long journey trip, like you take a train from Beijing to Urumqi. Right?He Yang: You guys are just ganging up to against me today, not giving me a chance. But as independent young women, I will stand firmly on my ground. That I’m saying travelling here means long distance as you are travelling to a different country probably go sightseeing. And why would you bring your home food?Ryan: No, no, specifically, I can’t answer that question, because I fill in the category of us Americans. In the study shows that Americans, we, tend to bring toilet paper and I’m all about that.Luo Yu: And condoms.Ryan: Oh, Godness, no, that’s totally false. He Yang: It’s fine if it’s true. You know, just do it safely.Ryan: Do it safely, that’s what we are saying. But as an American, it is, for us, is very hygienic oriented, which I totally agree with.Luo Yu: For us, it is very easy to understand, because, for one thing, we love to taste a little bit of food from home. And that’s why a lot of Xin Jiang people would carry loads of nans (nan bread) with them. You know, it’s very easy to preserve and not easy to get rotten or decayed. And people just love it, like people from Shanxi, Gansu or Ningxia. They have Guo kui. These like crusty and crunchy shells, but very tasty inside. So, it’s like people are a little bit nostalgic and they get used to the food already. So, that’s why we take with them.He Yang: Yeah, It just like South Koreans take kimchee with them. And whenever there having local food, maybe they want a little bit of something, that reminds them of home. But still, doesn’t that just defeat the purpose of travelling, you are going off a foreign country and I would still want to try the local staff.Ryan: I think it’s weird. Yeah, you should try the local staff but if it’s really bad, I won’t blame you for going to the MacDonald’s that’s probably that’s down the street, because it’s seems to be everywhere. But one thing I did say like I did like that 37 percent of Russians they bring playing cards, really smart. Playing cards are good.He Yang: Alright, I would like to finish today’s show with Han, our Wechat listener’s comments. He says: “I would definitely try instant noodles with local flavors, for example, kimchee noodles, if I visit South Korea or a bunch of other instant noodles with local flavor…Luo Yu: I love that advice.He Yang: It’s totally a genius.