Here’s what I learned this week

Last week I told you the results from the 90-Day plan.

Here’s the link to the full 90-Day plan.

Oddly enough this LinkedIn post didn’t get any traction.

But it’s probably the most systematic post I’ve put out in a while that tells you exactly what to do it was based on last week’s data shared in the email.

It’s long, but provides a way to incrementally test popup forms to drive more revenue, in out testing up to 20% more revenue from the same signups and 10% more orders.

It just works, you can choose how aggressive you want to be.

LinkedIn told me that Ecom with Jon is 1 year old.

So I’m giving away all my courses for the low, low price of FREE.

Go to jonivanco.com and sign up for all of them and unlock them for life, completely free.

I’m going to create a few more courses too in the near future that covers some of my other learnings from the last year or so.

I need to update the popup one to include our latest features of auto-add coupon codes plus drop off redirects as well.

Some people told me some things…

In the course of doing my job I ask a lot of questions and work through pricing issues by asking what a brand’s annual revenue is.

Let’s just say the other day I found out that a “darling” of the “DTC Success” world is making less than $11m in revenue per year and not as profitable as anyone thinks.

I’m starting to think that the whole of DTC with founders constantly on social media is a lot of smoke and mirrors, that the value is in building a personal brand by building in public, not an actual business.

There are some exceptions to this like everything, but eh…

Often the term “strategic acquisition” actually means “fire sale”.

Which brings me to influencers in DTC.

Someone sent me an email this week…

There’s a lot of shilling going on.

Shilling meaning = recommending products without disclosing your relationship or financial incentive to promote a product.

Formtoro provides zero financial incentive to people recommending our product.

Call me old school, call me stupid, I just don’t believe in someone promoting a product because of a financial kickback.

I think that it creates a conflict of interest.

I’m not a monster though, we have some clients that just simply aren’t making enough money to justify the costs of our software, talking single channel DTC brands where it just doesn’t make sense to charge.

In fact, a few of them are subscribed to this newsletter.

So this week I was forwarded another email about another great popup software from an agency owner who has fire sold and shut down all their DTC businesses.

The amount of agency owners I’ve talked to about software and the knowledge behind how technology and how software works has grown over the last few years, there is a gap in education.

Earlier in the week you might have caught my post about popup software, because something wasn’t making sense in the claims these software companies were making.

Here’s the post:

Klaviyo sign up form 4% opt-in rate.

[enter company name] 10% opt-in rate.

Same form, same targeting.

It must be the popup right?

Some sort of voodoo magic that allows this other company to boost sign up rates on autopilot, right?

Technology doesn't work that way, if you setup the same triggers, the same design, the same targeting, the results should be the same.

If they aren't the same, it means there's something behind the scenes going on around the targeting that no one is telling you about.

Hint, when you see that big of a change it usually means that the "company" that's doing your popups can't properly distinguish between people that have already signed up in Klaviyo.

Check the views, odds are those "company" forms are also getting more views.

We know this, because prior to Klaviyo's API update it was based on a hidden endpoint and even with that end point we saw on average 20-25% of people signing up that were already signed up.

Meaning your subscriber rates will appear to be "lower" with Klaviyo, when in fact they are likely the exact same actual new accounts as with another service with an inflated opt-in rate.

This is how technology really works, but most marketers don't understand this stuff.

So you're 10% opt-in rates aren't really 10% new, it's likely a combination of existing profiles and people signing up with different emails.

Trust me on this one.

Instead, focus on pricing in your intro discount, making current offers available to your existing audience.

Auto applying the discount to the order, and converting more people.

Stop chasing worthless stats.

Start focusing on the actual customer journey, life will be less stressful, you'll learn more about customers, and be able to actually impact outcomes.

The only reason to not use Klaviyo's existing internal forms is if you're looking to collect more data, logic map, and build models around zero party data in ways to impact your overall business outside of the email only silo.

Switching to a different popup maker because of sign up rate only is straight up dumb.

You’re hearing me correctly, this is me telling you to use Klaviyo’s forms unless you want to use some newer technology that converts more subscribers into customers. Not if you’re only looking for signups.

I don’t get paid by making one variable KPI go up, I only get paid in the real world if moving one KPI up correlates to overall business success.

This is what makes me money from the brand I run.

If someone signs up and doesn’t convert, I don’t get paid.

If there is no profit on that purchase, I don’t get paid.

So when we build popups we’re looking to only build them in a way that is focused on subscription to conversion, because that’s how businesses make actual money.

Far too many people are super focused on just individual KPIs with the misunderstanding that one causes the other.

But what’s not missed on me is that now it seems that every agency is just sharing all their templates, walkthroughs, products they like etc.

Just because something works for someone doesn’t mean it will work for everyone.

We also don’t know how actually profitable a lot of these company breakdowns are truthfully.

Like I’ve said, I have a lot of internal information from influencers some of which stores we manage, if someone is selling you services instead of just focusing on their other businesses that they sell services for, you should start asking yourself why.

That brand above that’s doing about $11m per year revenue was likely doing that at less than 20% net margin, meaning $2.1m in net revenue for a max 3-4x valuation, likely something less with earnouts on performance.

However most brands are actually doing around 10-12% net margin which means it’s far more likely they were doing around $1-$1.5m in net margin per year.

In this industry though, people just want to be liked, and portraying yourself as a success story without sharing the behind the scenes actual business numbers seems to be the way to go.

Specifically in ecommerce where everything is a screenshot over a limited period of time to show success.

The goal of most DTC founders these days isn’t around building a business, but instead using the role of being a founder to build a personal brand that dovetails into other business ventures specifically around networking and other services.

People want to be liked…

The truth is if we don’t like someone, we won’t adopt what they are recommending.

I’m speaking from experience on this one, there’s lots of people that don’t like me or my style or my no bullshit attitude about how to evaluate things beyond gut feeling.

I’ve been nicknamed, “the youngest crotchety old man on LinkedIn” and called lots of other things I’m sure behind my back.

It’s funny that no one actually wants to debate me live on a podcast though even if they don’t agree with me…

Just saying, I would think that more people that disagree with me would actually want to hop on a video call, podcast, whatever so we could chat for real about their beliefs and the data that backs it up.

The problem, I’ve found, is that most people doing software evaluations and anything statistical or data backed tend to make a lot of assumptions that aren’t necessarily true.

I was talking to someone the other day that was telling me about how a copy test a test lead to an increase of 12% conversion on a page from 1000 sales.

My first question, “What percentage of those 1000 sales came from first time purchasers?”

My second question, “What percentage of those purchases came from paid v. organic channels?”

Unfortunately, they didn’t know.

So this test could have been skewed by emails driving repeat purchases, it could have been nothing related to the copy at all, we’ll never know.

Also the amount of traffic is statistically likely too low to draw a good conclusion here.

I’ve talked about this a lot in the past.

As humans we’re really bad at running tests, there’s so much bias in how we set them up, how we interpret results, and how we believe correlation exists.

We often times get it really wrong because we struggle to look at things objectively.

I run into a lot of issues with this with the whole legal background, I just keep asking questions that people can’t answer which casts doubt on a lot of tests.

I’m old school in my approach to business and overly honest.

I don’t speak in hyperbole, I only promise what we know we can deliver, and I have an obsession with the basics.

Point in case, we have a client that just wanted to push their trial out another 30 days to properly test our tool because they stopped using it to do something else last minute.

Now this is a client I made multiple recommendations to that aligned with last week’s email.

The response, “No, I think we’re good, they’ll get it in an email anyway.”

Listen, we don’t build things to innovate for our health, we do it to make people money, but a lot of the time, I’m actually seeing inexperienced marketing managers directly sabotaging their own outcomes because of lack of understanding and over-reliance on their abilities and pride in their knowledge.

I try to be gentle around these things, “We’ve seen after working with all our clients that…” or “Totally, get it, you’re the boss, however, I would be remiss to point out that it’s likely you’re leaving 10% revenue on the table at least by not doing as recommended potentially 20%.”

Still at the end of the day, I’m not making a cut off their success so it’s their call.

In truth, I don’t really care anymore.

I can provide the education, the tools, and the direction for people to succeed, but it’s up to the person to want to actually succeed.

I’m not interested in mentoring everyone, I’m not interested in impacting everyone, instead I’m interested in only helping those that want to be helped.

I also think I’m learning that although our product Formtoro works for businesses of all sizes, we’re really more of a minimum $5m per year product which shrinks out TAM considerably.

(In it’s current form because of the knowledge needed to leverage the data properly, we’re working hard to close this gap.)

There was no class on how to make popups, there was no class on detailed customer journey touchpoints with checklists.

These courses and classes came to be because I was answering the same questions on repeat and I realized that there are really smart people out there that are hungry to learn but just don’t have the access to more advanced classes.

So I’m giving them all away for free for right now.

I think this is the right move for two reasons.

1. People will have more questions, I will end up going back into consulting based on the content in my courses, for me this just makes sense to become an advisor for agencies and brands from a strategic sense

2. My goal was and always has been to just create Jon as a Service that would work with the above

3. If you learn about the topics that I talk about, you should be using Formtoro with your clients or for your brand, it was specifically built for ecommerce brands that want to reduce resources and improve results

I think an education funnel is the best way to introduce people to SaaS products, you tell them what is better for the customer journey and then you lead them on the path to subscription complete with a full plan to validate the testing.

My goal was never to be an influencer but instead to help others learn and push themselves to learn more

I’ve started to get messages from lots of younger agency types that are starting to ask the real questions around the future of their businesses.

Truth be told, what I’m seeing is an entire industry of people that are only good at specific areas of business but lack the knowledge to be competent around all aspects of running a brand.

It’s a different skillset.

Most have never run a brand.

A lot that have run a brand have had their brands fail in epic fashion.

Some have been successful and hit the timing right.

Hardly any are currently building a brand currently in this market while offering outside services to other brands.

When I speak, I speak from the perspective of having run marketing for a brand with a successful exit that was sold in big box retail stores.

I speak as a software designer that builds functionality that is aimed at improving the fundamentals of a business, not individual KPIs.

I speak as a consultant that is often asked questions about positioning but very clearly knows that most businesses will fail.

In truth, the current environment is really tough in ecommerce, the model is changing rapidly and I’m not sure a lot of businesses will be able to adjust.

Here’s the current framework I’m using:

1. Your only goal is product in hand

2. Price your popup discount into your margins

3. Assume everyone will use a discount during checkout

4. Rotate sales based on this assumed discount for products that are selling slower

5. Find ways to give away product to your super fans in exchange for content

6. Focus on the easy wins

7. Data, data, data - ask different questions across different points in the customer journey and learn from those interactions

8. Simple beats complicated every day of the week

9. Over segmentation below $25-50m will kill your business, I’m starting to see a lot more of this than should be present in most accounts

10. Have fun, most brands aren’t big enough to have brand guidelines, these are just made up things by people to make themselves feel important

Everyone’s lying about their numbers

I want to end on this one, because working with founders there’s this mindset that “others must be crushing it” based on social media posts etc.

In truth, most often these brands aren’t crushing it, are losing money or barely profitable, and like most of those IPO’d companies in DTC world, finding it really hard to figure out a way to long term profitability of valuations that are meaningful.

Loud does not mean successful, often quiet and boring beats loud.

I want to see a return to smart, sound, small businesses with a laser focus on getting things done properly, where profit is more important than revenue and small teams can be well paid to run tight enterprises.

It’s not about growth at all costs, but positively contributing to society as a whole in way that creates fairness across your target consumer base.

The Takeaway

Click the link below and get access to all the courses for free.

Tell me what you think, tell me you hate the fact that the lessons are 45 minutes long instead of 5 minute bite sized pieces or that they go really in-depth.

But my hope is that if ecommerce is your think, you learn something from them.

I know people that have gone through the customer journey class multiple times complete with note taking, there’s a lot in there.

I know there aren’t transcripts yet, but I’ll try to get around to that too.

-Jon

Catch up on past posts: https://ecomwithjon.beehiiv.com/

You can learn from me: jonivanco.com