5 PPC Strategies to Take Advantage of during a Strange Holiday Season⎜ Perch ⎜ EP 183
Ryan Cramer: What's up everyone. Welcome to my corner of the Internet. I'm your host, Ryan Cramer. And this is Crossover Commerce, presented by PingPong payments. The leading global payments provider, helping sellers keep more of their hard earned money. Hey everyone, welcome back to another episode of Crossover Commerce. This is my coronary of the Internet, where I like to call Crossover Commerce. My name is Ryan Cramer and you have hit episode 183 of this beautiful show where I bring the best and brightest in the Amazon and the e- commerce space. But before we get started and into all the great insights from our dear guest today, I just want to give a quick shout out to our presenting sponsor, PingPong payments. No, we are not a table tennis company. No, you cannot call us for where is my PingPong paddle or any sort of gear that alludes to one of very popular game across the world. But we are a company that can help you save money if you're sending money internationally, if you're an Amazon seller, an e- commerce seller, and you're trying to pay your manufacturer, your distributor, your VA, if you're trying to buy assets internationally as well, work with business globally, do so with ease and simplistic nature with PingPong payments is free to sign up. You could save money instead of paying fees through Amazon. When you're receiving funds and selling international marketplaces. Also, you can do so instead of paying through USD to your supplier manufacturer, you can do it, get your goods quicker, more effectively, and save some time, money, and effort with PingPong payments. You can do that, by going to usa. pingpongx. com/ podcast, where you can sign them for free today and also catch all the former episodes that we've had in the past. That's right. This is episode 183. This podcast has been around for about a year. A little bit more than a year plus or so since last August. And we've had so much great content so make sure you subscribe to our channels. Know when we go live with content like this. We go live on Facebook, LinkedIn, YouTube, and Twitter. And then also this podcast will be available on your favorite audio destination. So you can subscribe anywhere you like. You can find content and just subscribe, just search for Crossover Commerce. That being said, it's episode 183. And I'm really excited today because when I traditionally and I was telling that my guess is, when I traditionally have a company of the aggregator, sensing in, aggregator, you want to call them. Growth companies, you want to call them roll up companies, whatever your definition of that would like to call. Typically have a CEO or business leader that's talking about, hey, what we're looking for for acquisition. I'm going to put that on a shelf today, and I'm going to talk about strategy. That's right. We're going to talk about just building brands post acquisition, and what we're looking to do to grow them. More specifically, we're going to be talking about strategies. I got five of them that I've been told that we're going to be covering today. Five strategies to take advantage of during, we'll call it strange holiday season. That's right. We're going to call 2021 albeit last year was quite strange. We saw an influx in sales. There was so much going on in terms of what a lot of people called the COVID bump. This is going to be an even stranger year with inventory restrictions. There's lots of people that are saying, and I got statistics in front of me. If you want statistics, 75% of consumers are going to shop earlier, shop more often, even before their traditional sense of Black Friday, Thanksgiving even closer to Christmas. More shopping earlier in the year means you got to have your PPC, your advertising strategies on point tied to your inventory problems potentially. What does that mean for you as a brand and seller? So we're going to go over some tips from, what our guests today is going to have those strategies to take advantage of today. So our guest today is actually Mike Frekey of Perch. He is the head of advertising at Perch, leading acquire an Amazon FBA. If you haven't heard of him, they're making this quite often, raising tons of money, raising over$ 900 million partly on Amazon brands, as well as directing consumer brands. One of those ones that you constantly hearing in the news and talking about him, he's going to talk about strategies, how they're growing those brands post acquisition to new heights on Amazon and beyond. That being said, I want to go ahead and bring on Mike to Crossover Commerce. Mike, thanks for joining me today from, I'm going to say the coolest man cave that we've ever had on in this entire podcast.
Mike Frekey : Thank you very much, Ryan. Fantastic to be here. And I'm really glad you like my setup. I think one of these days we'll probably get StreamYard to let us use a background blur without a green screen. But for now everybody gets to bask in the glory of my NFL, JP obsession.
Ryan Cramer: Hey, I've had to change my office around just quite extensively. My background pre when I turned it to my corner, I call it literally my corner of my office, AKA the corner of the Internet where I live and work from. I had a lot of Marvel, lot of comic book stuff, and that was always more conversation than what we typically talk about on this podcast. So I had to just inaudible it out. I had just had to move this stuff to the side. It's just off here to the screen. It's still important to me, but yeah, I love it when we were joking before in pre- show about this, of just the passions that we have about specific things in industry. You have passion for sports, so do I and different things in the industry. But you're a passionate e- commerce learner. You have such a cool background. I'm curious for our audience, if you can just give us a minute long background on who Mike is.
Mike Frekey : Absolutely. So, hey, Internet, Mike Frekey, head of advertising. Thank you for the intro. On my side, I've been in the Amazon space for a little over six years now, got my start actually on the Google ad side at a small digital marketing agency, also outside of Boston called Exclusive. But right away on that Google team, we sort of had an all hands on deck meeting saying," Hey, Amazon seems kind of important. Might be something that we want to look into." After a little while, became a founding member of our Amazon team, got to manage that, got to grow ourselves to managing the advertising of over 100 brands at once, and was just really proud of daily growth we were able to achieve both on the organic rank side, but primarily on the advertising PPC side. Learning the ins and outs of everything that was possible with Amazon seller central, vendor central, what was especially not possible at first, but Amazon's come a long way. So really excited just to take all of that skillset and take that into Perch, which we were also talking about pre show. But working with an aggregator, very much just working with an agency, only you're not hiding data from each other. We actually know what our cogs are. We're not going to lie to ourselves about our cogs. So that makes things a lot of fun.
Ryan Cramer: Yeah. I was going to say, it's fascinating to see the operation side. I don't think a lot of people do this in these kinds of formats, right? Of operation people are heads down, pencils up as we used earlier in a couple episodes ago of they're constantly working. It feels like over time in crazy environment, and I think that there's these notions that people don't always attribute one-to- one. And what I mean by that is the aggregator model will be a very fresh, very new, the agencies themselves, I'll call it an agency versus aggregator, versus accelerator. There's all these different paths that you can take a brand and grow to new levels. This model just happens to be something where you take something very successful, has evaluation and you and your team can look at it, say," Hey, you know what? We can take that to another level with the assets, the knowledge, the wherewithal, the know how, those playbooks, if you will, those SOPs." I can name everything under the sun. You have those things in place where you can say, hey, we can take this and we can grow it X, and that's your job and that's really cool. What I like to see behind the curtain of making these brands grow even more from there. So if you're... On a day to day, you're head of advertising, so you have to look across a board. What does that mean for our audience who's like, I look at an aggregator, all I think about is acquisition. What does a head of advertising do at a company like Perch?
Mike Frekey : Absolutely. So at Perch, we're really trying to turn advertising into a very controllable growth level where we can identify where any given brand that we've acquired is and where are they in their just product like cycle? Are they trying to grow their audiences, there's a very high repeat purchase rate product that we're trying to grow that initial base on? Is this a product that is potentially it's top of the class, but we know that there's additional innovation that's necessary just to keep up with where the market is going in the next year. And so how are we going to take that product and turn it into a launchpad for the V2 or V3 of the same product. And within all of those, we're trying to identify what's the best way to drive meaningful, convertible traffic. So advertising, being that channel to get people on page and ideally convert. Right now on our side, we're obviously using Amazon advertising. So right within the seller ads portal, we're trying to utilize all of the capabilities there to the best of our ability. And I'd say for the most part, pretty much everything in that toolbox is something that you want to be using at least in some capacity. But we're also trying to identify what about all of these off Amazon channels? What about the Googles of the world, your social media platforms, your Facebooks, your Pinterest, or even anything entirely outside of that realm in talking about other marketplaces, if we're going on to Target, if we're going onto Walmart. Are those ad channels that make sense to be using? I know that there are a handful of ad channels out there, for example, that will take your organic placement and just wipe it away, move it up to the top. And that's what sponsored is. And so if you already have high organic placements, then you're probably going to be cannibalizing a lot of your sales if you were to go as aggressively in advertising on that platform than if you were to do the same exact strategy on Amazon.
Ryan Cramer: I was going to say, how stressful is that? I'm going to put you in the spot here. Is your job probably the most stressful in the entire company? Because I'll set the premise. You're spending money to make it more profitable, but you don't want to cannibalize your organic nature of which there's already been this legacy that get it where it might be. It might be a top five ranking product that Google or that Amazon or Google is pushing to the forefront, but you have to tinker to a notion of, if it's at five, I want to get it to two or one. And it's that fine tinkering that you and your team have to do. And if you don't or whatever that spend it takes to get there, is it worth it or you have to maybe take a step back and find a different channel? Is that probably one of the more stressful jobs in the company that you yourself are doing?
Mike Frekey : Honestly, I think a lot of it's a lot of fun. It's working with the data, it's making hypotheses, running tests, a lot of scientific methods. So to me, that's just a really exciting side of it. If we're talking to stress, I'm going to give a quick shout out to our operations and fulfillment team, making sure that we have inventory of everything every time we need inventory. So I do not envy their position. Thank you, Monty in the team. But as far as advertising goes, there's going to be challenges to it I think, especially anytime we find changes to the competitive landscape. I think the biggest challenge, especially going from 2020 to now, 2020 we're pretty much, it was a situation that I think is impossible to replicate right now. We had a, yeah, cost per click significantly lower and not just in a, oh cost per clicks naturally will go up over time but more things... It was a very suppressed market. People were having significant supply chain issues, even more significant than what is going on right now. You had people who were entirely turning off their advertising, but also seeing the largest amount of traffic driven online at any one time than we've ever seen. We had peak Black Friday levels of searches happening every day for six months straight. And when budgets aren't adjusting for that, it's natural that everything is going to be as efficient as it possibly can. So that's just what makes things a little bit tougher in a year over year comp and trying to figure out how are we able to grow consistently. And I think that's the key word is consistently knowing that the comps we're using are in these sort of, we're going to use the sports metaphor, we're basically saying we have Patrick Mahomes on his rookie deal. And now all of a sudden we have to pay him 40 million a year. How are we going to keep up with the salary gap?
Ryan Cramer: Yeah. You have to cut the fat off in other places, but then you have to really put the money into the places where it's going to drive overall growth. And I like that analogy of that, in that capacity. It is tricky, I would think that there's all these new capabilities in the PPC world, especially when back in you and I are talking pre- show about 2014 and'15, when this Amazon FBA world kind of came at the forefront, there's this evolving nature. DSP became really popular in the last 18 months or so, there's a lot of notions that tracking and capabilities are really at the forefront of how you can get targeted messaging for a specific product in front of your user. And all the time, I think a lot of people here and then we'll get into the tips a little bit, the outside notions that are having an effect on just tracking capabilities of iOS updates that are going to hamper the ability to put relevant advertising in front of a person who is ready to purchase your product. There is the notion of driving traffic from one like a social media component to Amazon, doesn't have as much, Amazon doesn't like that. And there's a lot of different budding heads on external platforms when you are trying to find that right vessel. How frustrating is it for you to have to say, well, there's all these different things that we have to do in order to pull the right levers? Is it a lot of testing, is a lot of just like throw money or not money at the wall, throw spaghetti at the wall and see if it sticks? What was that testing process like for you and your team? I'm curious.
Mike Frekey : Certainly a lot of testing and that's really what I wanted to come into 2021 as my sort of reason for being is try to figure out what we can see does stick, what has legs, but shows that it's going to be an opportunity for us to continue to scale with and put a larger investment behind in 2022. So a lot of that's going to be various social medias. So a lot of that's going to be directly on Google, different marketplaces like I mentioned. But the biggest thing is that outside of the different marketplaces and to a small extent Google, Amazon is kind of a cheat code in terms of it being this advertising channel where people are explicitly telling you, I am in market, I want to purchase, and this is the exact product I want to purchase. And no other marketplace really works that way especially when we're talking about social media, where it's more, we're using the context clues of other behaviors to identify that you might be interested in buying a product. People on Amazon, they just tell you, yeah, I'm looking for a mosquito killer racket. Give me something to zap up these mosquitoes, give me some flexible garden hoses. And we're going to say, yeah, we got you right here fam. So that's what I would say the hardest part in evaluating what is repeatable within all of these other markets to prove in a short capacity test, is this going to be something that we now want to turn around and spend a couple hundred thousand dollars on in the next quarter or two.
Ryan Cramer: Absolutely. So with that being said, I know this is a very trying, not trying, this is a very important time of year for lots of brands and small business, small, medium size business owners, and especially for you and your team. It's the best way to know that lots of people are in market where you have one product or you have a slew of hundreds of products to choose from. Now's the time of year and when we were talking, pre- show, there's just so many different factors that we alluded to earlier as well of there's inventory problems. There is money problems. There seems to be, I mean, there's a lot of talk of inflation and you see that reflected in pricing cost of goods across the board, keep going up, spending goes up, but that's not hampered. And again, I'm looking at data and statistics that was released very recently, October spending, still growing. People did not hold back in terms of like saving money. People are still spending now is that in e- commerce numbers grew, retail numbers actually grew and exceeded expectations. Initially looking at those numbers, is that your indication that people are shopping earlier or is that just because we're just used to spending this time of year and we're going to spend even more and that's a good indicator for November and December.
Mike Frekey : I think it's a column, A column B situation. I would be shocked for us to look at any given Q4 and see that people are going to be shopping less than the previous Q4. At least when it comes to the digital marketing, or I guess the e- commerce space. Amazon's been on this sort of rocket ship. And even with knowing how much of an outlier 2020 was, my all indications have shown that people are still just shopping more on Amazon than ever before, which is a really fun thing to, for me to see in that Amazon space. But even outside of that, I do think that there's some meat to this idea that consumers are aware of this supply chain crisis. And not even necessarily in the average mom and dad at home who are starting to plan out their Christmas shopping for their kids are aware of saying like, oh, I don't know if everything's going to make it over from China in time. Like, I don't think it's really that more so, even I've been noticing throughout my own Amazon shopping and obviously through my view of competitors, just trying to do research, we see a lot of products on Amazon are showing as back ordered. And we're showing that a lot of products that, in past years, if you were out of inventory, and even if you had more on the way, your product would effectively be down, you would not have the buy box and your product would effectively be suppressed from the search. And now your products are not being suppressed if you're an FBA seller, you're going to still get the same amount of visibility, but when a user even goes to your product page, they're going to see should ship in about 14 days, should ship in 30 days. And that lead time is being just ragged out dramatically. And so I think that's a factor that is just more visible than ever before to a casual shopper. And so when you're seeing that repeatedly, then that's going to start to shift your mindset to saying, if I see something I want to get myself to get a loved one for Christmas, I'm probably going to act on that a lot sooner knowing that everything else I'm seeing is in fact out of stock.
Ryan Cramer: That makes sense. Well, I think that, that makes sense in a notion of Amazon gives you all these different options of when you weigh your goods. Like it can be condensing because of economy, of environmental scale, of, Hey, do you want all of them in one big package and people that takes out a lot of people who are trying to be more cognizant of that, or do you want to get it overnight needed by 4: 00 AM to 8:00 AM, which I didn't even think was a notion in terms of shipping that they were going to turn around that quick. But I think it just depends on location, right? Obviously where the inventory is, where you are in proximity of that warehouse. But then I also saw the notion of, and I posted this recently on social media that there was this cognizant effort of even though I was a prime member and as a consumer, they were still saying, Hey, do you need this next day by that 4: 00 AM to 8: 00 AM window? And they were charging an upcharge of$ 3, which I thought was fascinating. It's still coming prime, but if you need to rush it there, other than next day shipping even, like they can go in the window of 9: 00 AM to 11: 00 PM, I think is as late as I've had deliveries come to my house, but they want it guaranteed. Amazon's still up- charging that$ 3 increment to certain people. So I think they understand the stressors, but you're going to pay for those closer and closer to Black Friday, or I would say even December, closer to Christmas. Is that going to be something you see at Amazon maybe start to turn those toggles a little bit more of, hey, we can get it to you, but if you really want to guarantee, we're going to start putting the, you're going to pay even more than what you're additionally paying for shipping?
Mike Frekey : I think so. I'm also fully expecting. So last November, December, we started running into a lot of people who were not you using FBA, and were more in this sort of UPS, FedEx. This is how we're fulfilling all orders that they ran into significant just bandwidth constraints where UPS would say, yeah, you can get two trucks going to your warehouse and that's it. Oh, you have more than two trucks worth of product to ship out today? That's nice. You can hold on onto those orders until tomorrow. And I don't know how much of a change there has been on the UPS and FedEx side. I know Amazon had some limitations last year that the ideas they've been able to overcome that significantly through their hiring spree. I think it was something like 150, 000 just warehouse and fulfillment jobs over the past year. So hopefully FBA sellers, we're not going to have quite that issue, but assuming we're going to see something similar on the UPS and FedEx side, that just gives Amazon a lot more power to say," Hey, we know that a lot of areas within our supply chain, we do run things at cost and so that we can make money elsewhere, can we try to just claw a little bit of that back during this busy period?"
Ryan Cramer: Absolutely. And just across the board, starting in October of charges all across logistics channels at UPS, the FedEx, USPS, they're all surcharging earlier than normal. I think it was beginning of October when sellers were starting to see the upcharging cost, but let's get right to it. I say right to it. We're 20 minutes in and I was promised five different tips that sellers could apply towards their business. So I'm curious to, are these quick actionable for every person or is this more of a strategic, bigger seller? What's the context in that regards that you have?
Mike Frekey : I would say the majority of these should be useful for everybody who is currently advertising on Amazon or considering it. I'd say as long as you have products in stock. Yeah. Even if you don't have products in stock, everything's supposed to likely apply to you. So yeah, let's dive into it. So really on the back of this last conversation around those supply chain issues and are people shopping sooner, we're seeing that yes, at least October, even with the comp to prime day in October last year, overall sales on Amazon, not just Perch sales, but on Amazon, in general, people are shopping more and more this year versus last. And so with that in mind, we really should be ramping up our holidays campaigns sooner rather than later. Now I understand it is November 18th in terms of sooner, rather than later, that might have been about a month ago. However, I would say it's still definitely not too late if you are not running your advertising campaigns yet you don't have your full keyword research done with targets that you want to make sure that you're covering. The great thing here is as I've been doing my research for every brand within the portfolio on our side, I'm seeing that for the most part, roughly second to third week of December was the true volume peak for our products in 2020. So while everybody's talking about cyber weekend, everyone's talking about getting ready for Black Friday. Black Friday is the beginning of this period, it is not the peak of this period. So when we're really talking about the three weeks of holiday, you can launch campaigns today, biggest things I would be recommending for launching these campaigns, couple different structures that I find is just no brainer, every single person should be utilizing this, one would be Amazon automatic campaigns at a low bid for catchall. So making sure that you have more or less uncapped budgets, you can set these things up with five cents, seven cents, 13 cents did something just very nominal with an expectation of, you're probably not going to be owning anything top of search. You're probably going to be hovering around bottom of page two, page three. And the biggest area we're going to be showing up is on product detail pages. You're going to be showing up more frequently later in the day when everybody else is running out of budget if they don't have these sort of catch all campaigns show up. And these are still times where people are in fact, shopping and shopping at quite large rates, that's going to be one very easy way to just start doing as low as possible risk keyword, harvesting, identify where are people engaging with you that then leads to a conversion so that you can start to put more money into those targets, deeper into holiday. Another area that I would highly be recommending that people are pushing some of their early resources too and just figuring out what can work is use brand analytics. Anybody who's talked to me about PPC more than once knows how much I love brand analytics as a research tool, we have all the other fun ones for Helium 10 and Jungle Scout and any other way that you can do ad competitor and keyword research. And I recommend utilizing those two, but it is my favorite thing in the world to then go into brand analytics, take my products, and then identify from 2020 either all of Q4, just give me November, just give me December, show me what were the search terms that we were showing up on that we had a top three position on, and now show me any of those areas where as the year has changed, we've lost those positions on, because those are going to be the areas I want to start going after very aggressively.
Ryan Cramer: Awesome. Well, that makes sense to me. I think that would be, those are great starting places. And I think everyone has again, use the brand analytics, that's a free resource that's available to you where you have a paid subscription to one of those platforms that you had said as well. Do you think... Do you find, again a little offshoot, do you feel like a lot of people just don't do that retroactive comparison as often as what they try to do for future or in current time?
Mike Frekey : My understanding of where the majority of people, my understanding is that I think there's still an unfortunate number of businesses who do not do any amount of keyword research and they just try to leave things entirely with either one automatic only, which you could do worse or two, just the terms that they think of in their own head. And they think that that's going to be representative of all Amazon customers, which obviously you're just going to leave a lot of money on the table if you do that. But then from there, I do think a lot of people, when they're looking for keyword research, they're looking at the right now, what are the terms that I am ranking on right now and see where you maybe want to spend more, but you are losing a lot of context for what are the things that have proven to be successful for you in the past, as long as you go back and you look for it.
Ryan Cramer: Right. I was going to say, I think a lot of the shiny object syndrome, is where a lot of sellers get caught up in the notion of, oh, what's trending right now. Let me apply to this applicable notions of and it's funny too, because people are using Amazon more as a search functionality instead of Google now to find the products that they want. But again, I think this is me as a consumer, but also I look at the differences in higher psychology of what are people putting when they're searching for something applicable to what they're opting into? For example, on Amazon, I think you don't search for best, like you said, mosquito racket or anything like that. So the phrase best doesn't apply there, but on Google, you can find all these different blogs, articles, and notions where the term best is used more frequently instead of on Amazon. So the two don't correlate in the same way. I think people like, oh, I can use those terms that apply to my brain and throw them into Amazon PPC. Those do not correlate in terms of what people are actually looking for in that capacity. What are your thoughts on that Mike?
Mike Frekey : Oh, I completely agree with you. I've had a number of conversations with Google people who look at always trying to make best or top in line or any of these sorts of just research terms viable on Amazon, which to a point again, we talked about it a bit earlier that on Amazon people tell you exactly what they want. They're very much, they're in market for a specific need, and they're going to explicitly say, this is what I'm looking for. And so I think there's a lot of tactics that when people are in a research phase in a Google are just going to be more applicable to that audience. But on Amazon, there's a lot less research, not to say that people aren't going to be researching things as well. I think this is going to be a point lower on in the list of five, but trying to identify what are these more discovery level terms, people who are more identifying, I have a need, I can't even fully identify what that need is. Hopefully you can match me. So there's still opportunities for that on Amazon. But I do think that those take just a slightly different form than best X, Y, Z.
Ryan Cramer: Right. And again, it's more of they know what they're kind of coming in for, they're looking for that specific product. And again, having that broad versus like narrow match. But using specific terms like that, no, that's a tip that a lot of new time sellers might think that people are searching for. That's not always necessarily the case as much as you might think, Google versus Amazon. So I would consider what, we covered tip one, was that one? That was a lot, crosstalk.
Mike Frekey : That was one, I know.
Ryan Cramer: Man, look at that. So I guess moving forward, tip number two, what would that be for you?
Mike Frekey : Tip number two is probably the easiest and quickest one here. If you are running out of inventory, do not advertise. It's a very simple one. Yet we find that people who, and it really just comes down to if you are running low and you know that inventory is going to be replenished within the next month or the next week or so you have a shipment on the way, you're just waiting for Amazon to accept it. And you have no real expectation of going out of stock. This sort of doesn't really apply to you. It's more, I'm thinking specifically, I've both worked with a lot of decorations type sellers in the past, as well as we had some Christmas and holiday decoration brands on the portfolio as well. And there's really just no need to continue to advertise your Christmas trees if you have 100 Christmas trees left and it's November, those are going to sell out. And so trying to identify what that level of, if we were to turn off ads, how much more units are we going to be selling organically over the next week, two weeks, three weeks, rest of season. And if the answer is, we are most likely going to be selling out before we get to an actual end of season, turn off your ads, it is not going to help you at all to spend money to accelerate your stock out process.
Ryan Cramer: Yeah. I heard a great tip too with our friends over at Jungler. Her name is Elizabeth. She actually had a really good tip and she was talking about... Her notion is it always depends like, when you're going out of inventory, it depends on how I should take off my either advertising entirely or what actually that profitability is overall, right? Hey, is most of my actual image, if profitability is coming majority from PPC to that product, then yes, of course, you're going to want to either try to elongate it as much as you can, but if it's only 10% of your spend and that's where the profit's coming from or revenue is coming from, I should say, then yeah, turning it off, not so terrible because you have that 90% organic revenue coming in there. So I think people kind of look at it in different ways of it depends on where the revenue is also coming from, ads versus organic. And that's how you, and again, where inventory is. So it really across the board is that you're money maker entirely, or is it just a small portion of it again. It's always going to fluctuate from brand to brand, product to product. So make sure you look at that as a background. So shout out to Liz. I was listening in yesterday. That was a great tip as well. Good stuff. No, that makes sense to me, tip three, I would say. Yeah.
Mike Frekey : Yeah. So tip three. And this is where we're getting back to this idea of discovery terms. So far and way, I am a big believer at, especially on Amazon, your top following driving terms at all periods of the year, but especially going into holiday, are going to be people who still know exactly what they're looking for. And they are telling you, this is what I am looking for. However, this is a time of year where you're also going to see a significant up- pick in searches where people have no idea what they want. And they're saying, I want a gift for my mom, I want a gift for my husband, I want a gift for some person in my life, and here's something about them, I want a gift for someone who likes to garden, I want a gift for the golfer in my life. So we're getting people to identify, pre identify themselves for what they're looking for without coming right out and saying, I want a golf putting green. I want a garden miller. I want a really cool hairbrush that fits nicely in my hair or in my hand, and has just very nice pastel colors on the back of it. People aren't going to be searching that if they don't know what they want. And we are seeing that those are becoming more and more viable terms. Now that being said giant asterisk, they're not always going to be viable. These are terms where when we go back into my favorite tool brand analytics, and we take a look at conversion rates and just Q4 last year, for all other terms versus the giftable or stocking stuffer type terms. And when I say conversion rates, we're really just talking about that ratio between conversion share and the top products owning 50% of the pie or the top products owning 30% of the pie. And on the gifting terms, they're owning that 30%. And when someone says, oh, I want a baby sleep item. It's like, yeah, there's going to be about three total products that account for 65% of all sales. So knowing that, and I'll also say it's not just gift terms or stocking stuff or terms, the biggest category where this actually applies to. And I would say even more so because your conversion rates are actually going to be much better on these terms than on giftable terms, just toys for X. I love the word for when it comes to PPC, just having some way for someone to pre- identify that I'm looking for an item for this use case, for this person, that you can just identify some trends with, identify what words are people searching for most often, and that for X capability, and then build that into your actual product copy, make it so that you're an organic destination for those terms as well. And I'd say specifically toys, we're going to see people searching toys for four year old girl. They have no idea that they want a toy purse or a specific baby doll, but we're going to show that to you. And as long as you have a good product at a reasonable price point, people are going to convert at a pretty high rate there, even though they're not pre identifying.
Ryan Cramer: Does Amazon reward that can, or for example, how relevant do they look at your product? And if you're really just trying to loosely tie it to those terms versus, it is like you said, toy purse makes sense to me. But if I put this coffee mug and I say, gift for a four year old, how does Amazon, like clearly not relevant in many cases, Amazon will do what tier your campaigns, will they sync all of them? Will they start to suppress all of your campaigns? Like what are the fallouts for that if you are not actually tying products to relevant terms in that regards?
Mike Frekey : So depending on how irrelevant you are, that's going to have two different answers. So if you are trying to go very much, we're not relevant at all. We're not any... If I'm effectively saying I have a hairbrush product and now I want to show up on toys for girls. Well, yeah, we probably are like, this is a hairbrush for girls and this can be a hairbrush for small children that's one of the use cases for it. Don't imagine parents are going to be searching toys for and want to buy this hairbrush. So that's going to be a really good example where I would imagine if anything, we're just not able to get the visibility on it within a pretty quick amount of time, unless we're willing to bid 10 to$ 20 CPCs at the chance to prove Amazon wrong. I can't imagine that on truly high volume terms like that, you're going to have much success at all. But when you're talking about more, we have an actual toy product that we want to show up for in a toys for X year old. And we would say, we are, you can make the argument that this is a toy. And that is an age range that fits in. And now it's just coming down to, is your product at a price point where a parent would actually want to pay this is your product, have a product page where someone would say, yeah, no, this is something I think my kid would have fun with. And if the answer is no, and at least to a larger degree than it is, yes, then that's where you're probably just going to see your cost per clicks continue to go up. You might lose some relevancy or lose the ability to serve to a point. But chances are, if you say we are going in with both of those products at a$ 5 bid, you're probably going to maintain that position a lot longer and get a lot higher ad rank on the actual toy than you are on the hairbrush. And you're just going to potentially put yourself into a money sink.
Ryan Cramer: Right. And that was what I was going to say. I'm sure there's a chance that you can prove Amazon wrong in terms of relevancy. Through PPC, is that what you want to risk that... There's a fine line. I think there's that gray area where you can really test some areas, but not really build your campaign strategy and your advertising strategy around that, those kind of notions of, let's really broaden this horizon of what this hairbrush can do. So probably not the best use case in this regards, maybe in the future and looking at relevant terms that are organically converting. I'm also assuming like if you have some of those three per month or 10 per month that are like at the bottom of your list that are still converting, maybe look into those outlier campaigns and start to put a little bit more money into those sectors as well.
Mike Frekey : Absolutely. And I would say a lot of this just goes into tip number four, which is just test as much as possible, this Q4. Again, within reason, you know your budgets, you know what you can afford to do. I think a big thing that I think that I'm a very big fan of is minimum viable tests. So just trying to identify what is the least I can possibly spend the smallest data sets sample sizes that I can get to then feel confident that this is something that's viable to continue with outside of Q4 or next Q4. So if you do... If you're a very risk averse person that, and you don't have very deep pockets, you're just looking to see maybe gifting terms is for me, maybe toys for is for me, have been going explicitly after people searching for the name of my toy, or if it's a specific doll accessories I'm going after just the most on the nose terms, but this is a good time for you to go in, start setting up some tests to evaluate how do we convert in this area and what are the determining factors for if we can convert in that area, are we looking at it and we're seeing that the top sellers on these terms, are they beating us on price? Are they beating us on review count? Are they beating us in features? What exactly, if we're losing a sale, why are we losing that sale? And if we're winning the sale, what can we double down on that factor to then win that sale even more, keep going back and forth and within grand analytics. But really one thing that I love to do with it is when you have a term that you are able to even short term, push yourself into the top three click share on grand analytics, and then you know from your advertising, what your conversion rates are there, you can create some proxy metrics to see, well, how does my conversion rate compare to my conversion share to click share ratio. And now we can start to estimate using that ratio what are the estimated conversion rates of the other people in the top three of brand analytics? A lot of times when we're talking about pushing for organic rank. So part of this could just be testing to see, can we get a top organic rank? My biggest recommendation for people is, if you have a conversion rate that is not sustainable reframed, if you can estimate that your competitor's conversion rates that are in the top three of brand analytics are around 15 to 20% and you have a product that's hovering around 7%. Well, you can push yourself into the top three. You're not going to stay there. You're not going to stay there long at all. And especially the, at least I believe the busier the period on Amazon, the quicker Amazon's going to identify, oh yeah, you're really not converting. You might keep that position for a day.
Ryan Cramer: Well, the relevant terms are they do the algorithms based around past histories of your conversions versus where you currently do. So again, even launching products, I love talking and listening and learning about the notion of you're launching products and conversions a hundred percent. And then all of a sudden, even if you drop off to 85%, Amazon see that dip of 15% as a conversion that's not relevant anymore. They're going to start to suppress that listing a little bit further. So again, it's all on the confines of what's across the board. What's the top one, where's that conversion at? And they have all the data and it works within the house. And like you said, if it's seven, seven, seven, seven, and then all of a sudden you can bump it up to 20. And then all of a sudden you get to rank page one, but the consistency nature of like 15% for that traditional top spot is going to outweigh you unless you're willing to spend traditionally all the time to get above that fold. So that's a great point, like to the quick notion, sidebar of testing, Amazon, best place to test, or is there other outside ecosystems that really get you excited to test outside theories and then apply them to Amazon? What would those be?
Mike Frekey : Yeah. So one thing that I'm really excited about right now is trying to identify a good areas where let's keep it within this toys realm, where you might have a very specific product that sure you can convert when someone's searching for toys for X, Y, Z but, you know, you're not always going to, and you also know that those terms, because they're so broad in nature, you are competing with a lot of people, cost per effects are going to be dramatically high. And you also know that when someone does search explicitly for the type of product, you are, you are crushing it, your product just has such a great match when someone knows that you exist. At that point, I'm really looking at YouTube as a way to get very, very cheap impressions. Try to get people to just be aware of your product's existence. Facebook do a point too, but I would say YouTube is what's exciting me more within these tests and trying to track as a KPI search volume to these more specific terms that you are seeing probably 40, 50, 60% conversion rates on, and can you now, instead of getting a thousand searches a month on those highly specific terms, can you just get pretty reasonable expectation of costs? Can you identify an audience of call it 50, 000 people on YouTube in which you get 1% of those people to now do that subsequent search on Amazon. And now you've already gotten a 50% increase in your search volume for one of your top terms on Amazon. That's going to give you an extra 40% conversion rate. We're now talking about a couple hundred units on something that to get 50,000 of views on Amazon, we're talking about a couple hundred bucks.
Ryan Cramer: Right. And people might be asking too, obviously you can do advertising on there, but even simply just doing unboxing videos or having influencers, if you pay a notion or pay or send a product and get those... Those are actually popping up organically within product listings. Also, I know, for example, the most recent one I did that was a shrew, it was a branded microphone, obviously talking podcast.
Mike Frekey : That makes sense.
Ryan Cramer: But yeah, exactly. So Amazon actually pulled in YouTube channels that were reviewing those products. And again, it was an affiliate, it wasn't anything like that. It was all just reviews, unboxing, thoughts around the notion and they are pulling that strictly straight from YouTube, putting it and embedding it and then product listing. And obviously if you clicked on it, you can actually go to that page as well. So again, links that can go back to the direct page or I can live in that sponsored products, or I think even top five notion, top five list of products that are great for home offices or anything like that. If your product can be tied to that, it can go across the board. There's lots of different products that can go on competitor pages too, which is also funny in terms of that organic nature. So YouTube, Google being brought into Amazon as an SEO component, very cheap, you mentioned, but it's also great for visibility on competitor pages.
Mike Frekey : 100%.
Ryan Cramer: Very cool. And then I think that actually might lead us to tip number five, maybe.
Mike Frekey : Yes. So tip number five, expectations are that prices on Amazon are going to be going up. One in general, just as we get deeper into the holiday season and more people don't have inventory and they're trying to slow down their own velocity. We know that everybody's going to be raising their prices to a point. You specifically, whoever is watching me and listening to me right now, at some point, you're probably going to have to increase your prices because maybe you don't have two years worth of garden hoses available. And maybe you are in fact, looking to slow down the amount of sales you're doing over the next couple of weeks so that you don't stock out before even your peak period. So prices going up does give you a lot of opportunity in a few different ways. One, competitor prices going up, give you a little bit of the ability to say," Hey, I actually don't need to slow my role. I don't need to actually sell fewer products." but if everybody else is increasing their price, I can increase my price and still maintain some form of price competitiveness, and just pocket that as margin or utilize that to now push yourself further up the page in advertising. One of the biggest challenges I'd say that we're working with on the advertising side is trying to just walk that fine line between when you are running a promotion and you're trying to not double up on costs that you're giving away. So the cost for acquisition that you have to pay on any given unit from ads, as well as a lower margin to the fact that you are putting something on sale, you are lowering a price. And in certain instances that doubling up makes a lot of sense, because maybe this is an organic rank push, and you're just trying to solidify a top three position short term, or maybe this really is more of a, yeah, it's just a profitable longing push. And we know that our CPA on ads is X and a promo would be less than X. And so if we can actually pull back what we're doing on ads a bit, shift that over to a promo strategy, that's another way that you can just push for some additional incremental profitable sales. But the larger point is, as prices are going in that other direction, when things are going up, the markets are getting a little bit more expensive, are you able to then make use of that from an advertising perspective? Take the added AOV where even though sure your cost for acquisition, maybe that is going up a little bit, you still now have the expectation that you can afford to put more ad dollars behind this to really jump the line and get in front of some competitors who seems like if they're raising their price as well, they could be more in that position where they are stocking out and now you're going to have even fewer competitors to deal with.
Ryan Cramer: Oh yeah. Go ahead Mike.
Mike Frekey : I was going to say the one thing that kind of throws a little bit of a wrench in this is that we've been seeing Amazon taking off their own placements, this is just over the past three weeks that I've seen it in full force. Amazon just dropping down the number of ad units top of page from four to three and taking over what would have been the number one ad spot with a featured from our brands and showing Amazon basics of every single product. So even if the rest of the competitors are starting to increase their prices, I've not measured Amazon doing the same with their products. So that can make it a little bit more of a risky strategy.
Ryan Cramer: Right. I mean, Amazon, that's the wild card always. If you're in a competitive market where they have their own brand. In that capacity, they can eat cost or they can simply just, they're going to organically push it to the top. And that makes sense. And that's just difficult, but also to take note of. Actually, I have a real interesting use case study that I noticed too, in terms of promotions to push organic ranking, whether it was a promotion around the paid advertising ground. So recently I saw a promotion, I do amplified performance marketing and that's where my background lies in. So any affiliate deals or marketing or coupon deals in that ecosystem, I thrive in. So I saw something on a website called slickdeals. com. So if you're a consumer and you go to that, it's like best of web pricing or if there's a deal on a product, it can link to Amazon, it can link to a branded website. However, I saw this one specific brand Casa, it's a smart technology company. They were running promotion on Amazon for dollar, it was dollar LED smart bulb. So it can change colors and then$ 3 and 50 cents for their plugs. Now this drops down from 30, 35 bucks down to$1,$ 3. 50, so on and so forth. They're expensive products. But the notion that the promotion was under was for voice search functionality. So you have to actually ask Alexa and then you have to have a specific phrasing in mind, or like say that it would add it to your cart directly. And then once you go to checkout, then that's when the promotion would apply itself. So it's interesting. And I had a couple thoughts around what you were mentioning. My thought is, this is an organic push to get discounted deals and voice search for a, and it's a smart speaker or a smart switch and the also had smart bulb in the phrasing. This is an organic push to elevate them forward on the product side, on that branded term search. And then also it would elevate their products, but then also there's this history of sales and couponing and things like that on the back end. That's a big jump, but I think it was interesting to see... They're doing it now. So obviously Black Fridays, every Monday, things like that when people are searching for that, those are organically going to be ranking towards the top. And hopefully if you get your bulb today, oh, I like this, this is cool, I'm going to buy five more or something along this lines. What are your thoughts around that too? I'm curious, like in this minimum amount of time that we have left in this episode, what are your thoughts around different kinds of ad strategies that we're going to start seeing? Is it voice? Is it other social media, outside factors? What are we going to be seeing in the next 12 months or so next time when we have you on?
Mike Frekey : Absolutely. Well, number one thing I'm thinking is that I could really use some more Casa smart items. So I need to look into the specific sale.
Ryan Cramer: You should, I'll send you the link offsite. So I'm not an affiliate. I was like, it still exists. I just couldn't take advantage. I'm only one customer. I have my wife tried to do it and she's like, that doesn't exist.
Mike Frekey : Oh, I would. Yeah. If you send it to me, I would love to. But outside of that, one of the things that are top of mind for me, Amazon live is going to be a big portion that I am a big believer in, specifically when we can coordinate advertising efforts to drive people to our product pages when live on that page in a pretty accessible area, you're going to then see, by the way someone is now live streaming the unboxing of this item, you should check this out and try to identify how we can really maximize conversion rates during a specific busy window by combining advertising, potentially some sort of a coupon and then an Amazon live stream deal all at once is something that I'm very excited about for the prospects of 2022. We're doing more research into posts seeing as Amazon continues to tease that becoming an actual ad asset, as opposed to an organic asset, is that something that we can make into a feasible growth lever for us. I'm a little bit, I'd say I'm pretty skeptical on posts, but I've at least seen enough performance to see that there's upside to them as well. And the last one I'm looking at that again, just outside of your standard day to day advertising, just better creatives within sponsored brand video. And probably trying to see if Amazon increases from one on page video added to probably just double that to even if it's a lower on the page one. I can imagine Amazon trying to push sponsored brand video significantly more based on everything that I know its display and video, the two areas that are going to be continued focuses for Amazon going into 2022.
Ryan Cramer: Absolutely. We had a couple of people comment on some of the things we were talking about throughout the day. Your colleague Nathan also loves the portfolio, which I caught it a couple different times, by the way. I like that plan. I'm a punny guy. So I appreciate all the puns, but we actually had Nolan who is inaudible. We have a great window of our e- commerce feature if you look at China. So he was looking at more of an international play too. Is that something, we didn't even have time to cover that international audiences, is that also another green pasture that you and your team are starting to look at how that applies to the brands moving forward into 2022? Do you have any quick thoughts on that?
Mike Frekey : 100%. I think that international... Specifically, we're looking at, obviously North America international as well as EU/ EU plus for or our good UK friends. Any level of international, I think is a large opportunity that we're excited to go into, but also just looking at where we probably going to be putting more of a focus in, I think those are the largest areas that English speaking audiences, where there's just slightly less of a roadblock in terms of ease to scale into. And then from there, I can imagine Japan is an audience that we're excited about, obviously China, but then also now we're looking at any of these other Amazon alternatives. So a shoppy, for example. So excited about all of those.
Ryan Cramer: Absolutely. Yeah, Nolan was saying, yeah, video and e- commerce is pretty remarkable in China. So that, yeah, QVC is cool again, is what he said. I like all these hot takes. Nolan keep them coming. So I agree. And again, like Amazon live, all these different opportunities for you to get video content, you're seeing more offsite branded content, affiliate marketing in terms of editorial becoming more relevant of, hey, this is what this wire cutter will be obviously talking about your brand. There's all these different paid placements. And again, we didn't even set the table of Amazon used to be entirely all organic placements now on a product page or on a search page, I think it's all, but one is a paid placement on a product page or a search page. So it's going to keep ebbing and flowing. I think a lot of people are trying to get their head around how much to spend and things like that. But I loved all these tips. I think they're applicable to small sellers as well as larger sellers too. So, but that's... I mean, I think that's a nice place to put a bow on this hand and say for Q4, it's going to be exciting to see what outcomes I think a lot of people are scared going into the remaining part of the year. Q3 was a little bit of a downturn, but I think coming out of summer, going back into winter, you're going to see a lot more people going back to those ease of use curbside pickups, and that's all done through online shopping. So that being said, do you have any parting words for us or parting words of wisdom, Mike, that you can bestow upon all our listeners or watchers?
Mike Frekey : Absolutely. I want to leave everybody with just two thoughts. One that advertising is a very good controllable growth lever for you, as long as you stay on top of it. So making sure to just put your best at it, you'll get some pretty good results. And two, if you ever want to keep up with me or anything else going on at Perch, definitely go to perchhq. com, that is perchhq. com and reach out to my guy Nathan, he'll always be able to hook you up with a little bit more knowledge.
Ryan Cramer: You beat me to the punch man. I had this queued up and ready to go for you. I was going to say, how can people, yeah, and obviously we put your LinkedIn handle at the bottom too. So Nathan, awesome to connect with. And obviously the team I purchased is top notch too. So I'm excited to see you guys grow in the future. I know there's lots of great acquisitions that you had, lots of cool behind the scenes stuff I'm sure that are happening going into the new year. I'm really excited to hear more about what you guys are doing. And now for end of the show, I'd love to have you Mike back on again, and we can chat PPC or advertising at any time with you. So thanks for helping on, I know short notice, I kind of went to the bullpen and asked, who do I know that they can help on real quick. So it was awesome that you guys said yes to this quickly. So thank you so much for hopping on today.
Mike Frekey : Absolutely. Thank you so much for having me and I'd love to come back.
Ryan Cramer: Awesome. Thanks Mike. Again, that was Mike Frekey of Perch. Again, everyone, if you have questions for Perch or Mike, you can reach out to them on LinkedIn or again, there's that go to perchhq.com. Again, that's pretty easy to find you can search Perch, Amazon, Google, or however your heart desires. Everyone knows them. I think they have lots of great things ahead of them as well, but really cool tips and actual items that we got to learn about today from now friend of the show, Mike. So again, this is episode 183 of Crossover Commerce. This is my corner of the Internet, where I bring the best and brightest in the Amazon e- commerce space. You guys love what you heard, go ahead and give us a thumbs up. And if you can subscribe to our channels and I know I put the ticker down there too. There's a cool board going around the Amazon service provider space. It's called sellerpoll. com. If you like the content that you hear on here, you're passing. You got love, great and valuable information on here, feel free to go there and you can vote for your favorite service providers teachers. You can vote for Mike, you can vote for myself. You can vote for whoever you want, but go ahead and support that great cause too, give recognition to people who put hard work to educate the audience as well. You can do it for podcast, YouTube channel, whatever those categories are. You can just do that by going to sellerpoll.com. I'm Ryan Cramer, this is my corner of the internet and this is Crossover Commerce. We'll catch you guys next time on another episode, take care.
Ryan Cramer of Crossover Commerce talks with Mike Frekey of Perch one-on-one as they discuss 5 PPC strategies to take advantage of during a strange holiday season.
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