Monday, March 20, 2023
If this isn’t living the dream, I don’t know what is. 🌶️
In this newsletter, you’ll find: 👇
📦 Is Amazon a revenue avenue for your business?
📦 Transform your brand and make the road to growth easier with Printful Enterprise
📦 Are you evaluating email and SMS as a retention tool?
📦 Get ‘Aspire’s 2023 Influencer Marketing Insights’ free report
📦 The benefits of long-form video ads
Read till the end to access exclusive DTC swag. 😎
👉 If a pal forwarded this to you, subscribe, so you never miss out.
Should You Sell Your DTC Products on Amazon?
Did you know 60% of American households have an Amazon Prime membership? 🤯
Love it or hate it, there’s no denying Prime is an ecommerce juggernaut. Compared to Google, which is used more as a research and discovery tool, people search for products on Amazon when they’re ready to make a purchase, creating a dream scenario for any online merchant.
However, despite the attractive nature of Prime, the relationship between DTC operators and Amazon has been fraught (some might say they’ve been “frenemies”) over the years:
😡Shipping speed expectations and competitor pricing comparisons between the two have been detrimental to the bottom line of many small brands, and Amazon has been accused of replicating popular items and displaying its own products at the top of the search results.
😍Many merchants have come to rely on Amazon for easy order fulfillment, increased sales, and brand awareness. Rumor has it that a few ecommerce companies have dropped their websites entirely in favor of selling through this powerful growth channel.
If you’re considering selling on Amazon this year, you likely have a bunch of questions about whether it’s the right fit for your brand, how to prepare, and what costs are associated. We’re here to answer them.
💕A tale of two CPG brands
To give you a glimpse into what to expect, we interviewed operators at two food brands: Nima Sotoadeh, Founder & CEO at Broya — an organic bone broth company that recently started selling on Amazon Canada, and Kaitlyn Fundakowski, Director of Ecommerce at Chomps — a grass-fed beef jerky stick company that has been selling on Amazon in the US for years.
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What compelled you to sell your products on Amazon?
Kaitlyn: The sheer amount of daily traffic on Amazon is unmatched and makes it incredibly tough to say no!
Secondly, the Fulfillment By Amazon (FBA) model is simple and easy for brands to adapt to in the early stages without a huge distribution network foundation built.
They get your product in customers’ hands fast and priced efficiently (for most categories.)
Nima: First, there’s the Amazon shopper who doesn’t shop DTC; you get a bit more reach than you might not be getting. And we charge shipping on our website, so if you have Prime, it’s a lot easier to order through that.
Also, turnaround time. Submitting and getting listings approved and sending the first shipment over to Amazon takes maybe two months.
Are there drawbacks to selling on Amazon?
Kaitlyn: Amazon doesn’t provide customer information to follow up with things like loyalty programs or subscriptions. DTC wins any day in this area and will always be most important because of our direct touch with customers.
However, we do what we can to encourage repurchase through subscribe and save messaging and curated Demand-Side Platform (DSP) audiences.
Different from DTC, we don't control every moment of the experience. If a customer's subscription is late or an order is damaged, we don’t have the opportunity to apologize directly on the brand side.
We do what we can to make sure we monitor any issues that might come up and find creative solutions to improve.
Nima: The margins are tight on Amazon because you have fulfillment fees and referral fees, plus agency and ad costs. We’re trying to figure out how to make the business of Amazon profitable.
And if you have 25 or 30 product reviews and two or three of them are one star, that can bring your rating down to under four stars. Once you’re under four stars, you’re screwed on Amazon, basically. Conversion dips pretty hard. If you try to game the system, you get banned.
What advice would you give a DTC brand considering Amazon as a growth channel?
Kaitlyn: Run DTC and Amazon side by side, not in a silo or against each other. There’s a time and place for both, and each provides different shopping experiences, customer touchpoints, brand awareness, and overall experience.
Test and learn through advertising, email, and other channels to learn where your customers like to shop to optimize brand growth.
Nima: Nail down the numbers to make sure Amazon is a profitable channel. Remember, you have to factor in the FBA referral fee, fulfillment fees, and advertising costs. Make sure you sanity-check your costs with any external vendors — we had to switch our third-party logistics because the fulfillment fees were crazy.
If you’re just getting started, consider partnering with an agency or outside expert who can work with your 3PL to make sure your products stay in stock, offer listing management and reporting capabilities, plus PPC ad and keyword guidance. Interview 4 or 5 different people to compare monthly management fees and find exactly what you need.
On-Demand Production + You = Business Growth!
💤 Losing sleep over frozen cash in inventory and operational hassles? Worry not dear reader because, with on-demand production from Printful Enterprise, you can rest easy!
Printful Enterprise is leaps and bounds ahead in the on-demand printing and fulfillment world. With Printful, you can:
🌻 Your brand deserves to grow, and Printful is here to help you do it!
Are you evaluating your email/SMS marketing efforts as a way to boost retention revenue? If not, you may be missing out!
Last week on All Killer No Filler, the Pilothouse email team discussed the quantum puzzle that is email marketing and how to turn your email program into a customer retention program.
🧠 How to get started
If evaluating retention hasn’t been top of mind, here are two reports you should be looking at to get in the know.
1️⃣ Sales over time
In your Shopify dashboard, go to analysis and make a sales over time report. Within this report, be sure to add customer and customer type.
The customer type tag will help you identify if the sale is a first time or repeat purchase. Look at your revenue split and see what’s ‘old money’ and what’s ‘new money’.
If you haven't been actively measuring, this ‘old money’ (or retained money) can be easily doubled! On average, the customer retention team at Pilothouse has been able to 1.5-2X the amount of repeat purchasers through improving email!
2️⃣ Total vs. returning traffic
The next metric to note down every month? Total traffic vs. returning traffic. You can easily find these numbers in Google Analytics.
When your month-over-month returning traffic is improving, you’ll naturally see returning business increase.
👉 When starting your email/SMS retention journey, the team suggests focusing on two things:
For tips on how to figure out the right cadence for your audience, information on dedicated IP’s, and more on using email as a retention tool, listen to the full episode here!
The Rising Tide Is Coming…
68% of brands are increasing their influencer marketing budgets this year. With more spending comes more competition.
Will you stand out among the sea of influencer ads?
You will if you read Aspire’s 2023 Influencer Marketing Insights!
This free report helps you get ahead of the wave 🌊 and create a winning influencer marketing strategy.
Learn:
PLUS a new tactic that’s been shown to 2X engagement and 4X click-through rates on influencer ads.
The rising tide is coming… 🏄 Are you ready?
👉 Grab your lifeboat today. Download Aspire’s free report.
Is Shorter Always Better?
🔎 A mystery to solve
We’ve seen some reports noting that longer video ads are demonstrating better performance within the tech space than the shorter 10-15 second format.
Liftoff analyzed 1T impressions across 24.5B clicks and 240M installs from 2022-2023. Those aren’t rookie numbers so we couldn’t help but dive in ourselves. It seems like the sweet spot is about 31-60 seconds long so what are marketers doing with all of that time?
🤔 When in doubt, test!
Test everything. Take one of your shorter ads and compare it to the performance of a longer version. If you don’t have a longer version, you’re barking up the right tree!
There are a couple of areas to start with:
✏️ Start writing!
Every brand has a story. Every product should solve a problem. So show your audience how your product solves their problem using a scenario that could happen any day of their week.
Remember to weave the voice of your brand into your messaging and craft a unique vibe for your audience. It pays to curate an atmosphere that people will want to indulge in everyday.
💃 Show off a little
Demonstrate how your product works. Seeing is believing after all! Showcase those unique selling points in action to build up your audience's trust. You can even ask your customers to submit videos of them using the product for some tasty UGC.
📱A treasure chest of UGC
Leverage those UGC videos from your biggest fans. TikTok, Instagram Reels, and Snapchat have all demonstrated the power of UGC videos for DTC brands. This is especially true when consumers aren’t able to hold a product in their hands prior to purchasing.
It’s a hard pill to swallow but people will trust third-party reviews more than direct messaging from unknown brands so be loud and proud with your best reviews!
🏠 Use your foundations
If you have a library of smaller ads, some of them may be similar enough to combine! This is the scrappiest way to generate longer ads and it doesn’t always work as well when compared to dedicated long form ads. Give this a try if you feel like your branding and creative is cohesive enough throughout multiple ads.
💪 Now put it into practice
We love seeing brands try new things (or maybe revive things in this case!) so if you haven’t tested a long form ad, it could be worth a shot. Every audience is different so the only way to know if long form ads will work for you is to get out there and start testing!
Quick Hits
🚨 Hexclad scaled from $0 to $100k+ in monthly ad spend on TikTok using KNO insights... See the same result plus get $5k toward your Ad spend before March 31st. *
😞 Meta’s ‘year of efficiency’ brings lofty AI ambitions — and more mass layoffs. Meta Platforms is planning to eliminate 10,000 jobs, and double down on artificial intelligence (AI) in its latest blueprint.
🤖 LinkedIn adds AI-generated profile summaries and job listings. LinkedIn is adding new AI-powered tools to its platform, including personalized writing suggestions for profiles, AI-generated job descriptions, and new LinkedIn Learning courses focused on AI.
👀 Google Analytics 4 introduces Custom Channel Groups. This new feature will allow your brand to create customized rule-based categories for all traffic sources that lead to your website.
*Sponsored
🟥 Mid-Day Squares: Jake Karls and Nick Saltarelli - Rainmaking, Fundraising and "One word: F&%^ng Crazy."
🧖♀️ Bushbalm's David Gaylord goes B2B, Enters US retail bigly, and rides the Vajacial wave on DTC.
👀 Ronak Shah - Obvi Collagen - Obvi's biggest blunders (and how you can avoid them) - C-Suite Mentor Preview.
🚀 BattlBox John Roman - The Subscription with the ~$1000 LTV and the Netflix Rocket Ship.
👟 Kuru Footwear’s Turnaround Playbook: Sean McGinnis On The CRO Tactics That Doubled Revenue (C-Suite Mentor Preview).
🧑🦲 iRestore Hair Growth System: Kevin Chen - The True Impact of Costco.
💡 Listen to the Biggest Marketing News Stories Today.
Don’t forget to rate the DTC Podcast on Apple (⭐️⭐️⭐️⭐️⭐️)
DTC Newsletter is written by Rebecca Knight, Juliana Casale, and Michael Venditti. Edited by Claire Beveridge and Eric Dyck.
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