Matt Edmundson: Well, hello and welcome to the Ecommerce Podcast
with me, your host, Matt Edmundson. Now, this is
a show all about helping you deliver Ecommerce.
Wow. And to help us do just that, we've got a
special guest, someone who has been on the show
before, Raul Galleria from Referral Candy. Now,
Raul was on the podcast in 2021. We talked about
referral marketing and if you've listened to that
episode, you'll remember how good it was. So I'm
really, really looking forward to this
conversation and getting going again. Raul
reached out to me a few weeks ago and said, matt,
I've got some really interesting stuff. Can we
chat about it? And I'm like, of course we can. Of
course we can. And before we get into it, let me
just say very warm welcome to you. Especially if
this is your first time with us on the Ecommerce
podcast, It' great to meet you. Do reach out to
me on social media, Edmundson. You'll find me on
LinkedIn, on Instagram. It'd be great to connect.
Let me know what you're doing, Let me know about
your business. I was just talking to a chap
called Dylan earlier on today. Dylan, if you're
listening, hope you're doing well. And we were
chatting about his ecom business and he said to
me he found the podcast in August, right. And
bearing in mind the time of recording, this is
October and he's already caught up. Right. And
we've been on air five years. That's some going,
not going to lie, some going. And I just have to
apologize for the sheer amount of my voice in
that time. But anyway, do reach out. Be great to
hear from you, great to connect with you and of
course, if you are a regular to the show, a warm
welcome back. Now, let's talk about Raul. He is
the chief advocate at Referral Candy, which is
the go to app for E commerce brands looking to
grow through customer referral programs. He has
got over 10 years of experience. He's been a
Referral candy a wee while, as we say, which has
empowered 30,000 plus brands to turn their
customers into a marketing force. Love that
phrase. For the past five years, Raul has led
partnership efforts connecting with marketing
agencies, media and tech companies to boost
growth without spending on ads. So, Raul, welcome
to the show, man. Great to have you back. How are
you doing today, good sir?
Raul Galera: I'm doing pretty good. Thanks for having me again.
Matt Edmundson: Oh, no worries. Always great to have you back on
the show, man. Always great to talk to you. We
were talking before we hit the record button I'm
sort of slightly envious of the weather that you
have where you are versus the weather that we
have where I am. You need air conditioning, I
need a heater. And it's amazing because we're
only a few hours apart how just a few degrees on
the old equator changes everything. But, you
know, there it is. So it's been what we were
saying. In fact we looked at the date. It was
sometime late, late September, wasn't it? When
you're on the show in 21, which is, it's almost
like you said, the three year anniversary.
Raul Galera: Yep.
Matt Edmundson: So what's been going on the last three years?
Raul Galera: A lot. Yeah, we talked end of 2021, which we were
pretty much still at the peak of kind of like
Covid fuel Ecommerce growth. You know, 2021 was
still a year in which companies were getting, you
know, crazy amounts of funding. Everyone in the
space was, you know, growing with again just like
cheap borrowing lots of money available for, for
funding for DTC brands. So things were going
pretty well for everybody, you could say in the
Ecommerce world. 2022, we started to see a little
bit of a, kind of like, you know, darker clouds
in the horizon and that kind of materialized in
2023, I think, in which I was just talking to a
few people a couple weeks ago about it and you
know, I was saying how some brands in 2023 said
that, you know, it was almost a flat year. And
some of them said actually flat year being a flat
year was almost like the, the positive scenario,
you know, for, for a lot of brands, like if you
were just flat on 2023, you know, you could, you
know, pat yourself in the back and you know, it's
like, good job. Right? You kind of, you made it.
That being said, we had a lot of growth around
the Black Friday and Cyber Monday mark last year.
A lot of people say that it was, you know, fueled
by, you know, kind of like buy now, pay later
type of debt, that we don't know what's going to
happen in the future. But I mean the numbers are
there and you know, we're entering again since
October 7th. Today we're heading into Black
Friday Cyber Monday fairly soon. Brands are
getting ready for that and there's always this,
you know, there's like this big question of
what's going to happen. It's going to be bigger
than last year. How are the US Elections going to
play out in all this? So yeah, one of the
initiatives that we put together kind of because
of all these unknowns that A lot of agencies are
having. We put together this confidence report to
try to shine some light on at least what other
people are thinking and kind of like, what's the
mood around Ecommerce agencies on a monthly basis.
Matt Edmundson: Great. So just. It says here that the confidence
report involves gathering data from around 100
agencies on a monthly basis. You guys are
creating therefore a confidence index, which I
just, I think is such a great phrase, and
tracking trends in Ecommerce, such as how brands
are spending on marketing, hiring agencies,
versus in house, and much more. So you've been
putting this confidence report together, which I
really like the idea of, by the way. Thank you.
The agencies that you're talking to, are they all
marketing agencies? Are they a variety of
agencies? What kind of agencies are we talking to
here?
Raul Galera: One thing that they all have in common is that
they are Ecommerce focused. So I would say the
majority of them are marketing agencies because
there's a bunch of questions that are about
marketing budgets. And so obviously they're the
ones that I would say the vast majority of them
have touched kind of marketing with their
clients. Probably kind of like, I would say the
main difference between all these agencies is how
they attract customers. So I would say there's
like two big groups of agencies, one of them that
are just like pure, you know, marketing ads type
of companies that focus on that or SEO, you know,
kind of type of thing. But like they focus just
100% on marketing. And then the agencies that do
like website builds or migrations or redesigns
and then kind of keep that customer on retainer,
typically with some other types of services that
may include marketing or just maintenance or
whatnot. But yeah, the one thing that they all
have in common is that they're almost 100%
focused on Ecommerce.
Matt Edmundson: Yeah. Which is great. And are they worldwide or
are they just focused in one particular area?
Raul Galera: Yeah, I don't have the numbers for me right now,
but I think it's like 50% US and Canada and then
like, I think like 30% Europe and then the rest
between Australia and Asia, Latin America. So I
mean, it's kind of leaning a little more heavily
on Europe and the US But I'm actually in the
process right now kind of getting more agencies
from Australia as well. So we can get kind of
that side of the world as well. But yeah, I'm
trying to keep it as open as possible.
Matt Edmundson: Fantastic. And so your job then is you're growing
this, you're getting more agencies on board. Just
a quick pled. Then if you're listening to the
show and you're an Ecommerce agency, then do
reach out to Raul. How do they get hold of you?
Raul Galera: Yeah, so I mean, they can find me on Twitter. I
think my ad is raulgalera D. Or just search for
roller referral candy. You'll find it. Otherwise,
on our website we have the report and we have
like a little call to action where you can, you
know, if you want to be a partner agency, you can
submit and says referralcounty.com EACI cool.
Matt Edmundson: EACI.
Raul Galera: Yeah.
Matt Edmundson: We will of course link today in the show notes as
well, which you can get along for free at the
website ecommercepodcast.net and of course, if
you're listening to this on your favorite podcast
app, they'll be on that as well. Just scroll down
and they'll be there and just click the links
through to Raul. But so let's jump into it then.
You know, you've got this confidence report.
You're talking to e commerce agencies all over
the world, all of whom Ecommerce commerce as
clients, and they can see what their clients are
doing, where they're spending and so on and so
forth. At the time of recording, it's October.
We've got Black Friday Cyber Monday coming up. Is
that a big deal right now for agencies?
Raul Galera: Yeah. And so I would say that that is probably
what is driving most of the confidence in
Ecommerce right now. Okay. So when we started the
report last year, the first month that we did
the, the first report that we put out was in
January 2024. So we started doing research on. In
December. And you know, with that, we, you know,
we're pretty much asking agencies that were, you
know, kind of in the middle of the hangover after
the Black Friday Cyber Monday and holiday kind of
season sales from last year. So confidence, I
mean, actually that was the highest level of
confidence that we've registered since, since
January. It's been, you know, going downhill
pretty much up until like June. It's when it
started to pick up again. July, August, September
have been going up, but still in the second kind
of highest month in terms of confidence has been
this month. I mean, September, but still it's
nowhere close to what we register in January. So
I have the feeling that, you know, it's kind of.
It's getting. Well, I guess we'll see. You know,
obviously if we continue doing this next year,
we'll be able to compare notes, you know, one
year versus other. But it seem to me that it's,
it's fairly seasonal in sense of like you know,
kind of like summer months, obviously slower and
like everybody's kind of always looking forward
to that. You know, black friends have Monday type
of, type of event that kind of defines the year.
And so. And again, we were talking about it
earlier where in the last year, which was for a
lot of brands was flat at best. They were looking
forward to that Black Friday Monday event. To
just see. Yeah, to see, like, okay, let's just,
let's just close the year. Like, let's just see
if it was really a flat year. It was positive,
negative, like, you know, so. But, you know, we
can't really say anything about 2023 until we hit
mark. Right. And so it looks like it's pretty
much the same happening this year. So 2023 all
over again, really.
Matt Edmundson: So people are finding it quite flat at the moment.
Raul Galera: So I would say, I mean, it's, I mean, like 2023
all over again when it comes to that excitement
about Black Friday and summer Monday. Like, it's,
it's. I don't, I don't think it's been that flat
of a year, but there has been seasonality and
again, it's not necessarily like a. From what.
Again, from what I've seen on the, on the
responses that have gone from agencies, it hasn't
been that kind of sustained growth that you're
kind of looking forward to.
Matt Edmundson: Yeah, that's interesting is if I was to think
about my own experience, I'd say 2024 was
definitely better than 2023. Yeah. Certainly in
our online businesses, in our agencies and, you
know, the people that we partner with and so on
and so forth, this year seems to have been. It's
not true for everybody, obviously, but on the
whole it sort of feels slightly better. You've
got a few key events coming up at the moment,
which I think is really interesting. In the uk,
we've got the October budget. So this is where
the government decides how they're going to try
and fill a big 20 billion pound tax missing hole.
So everyone's slightly concerned about that, but
at the same time, not. Obviously, we've got Black
Friday Cyber Monday, which people are building up
for. So I do wonder if retail sales have slowed
with the new government and everyone's going to
wait to see what happens and then obviously we've
got Black Friday Cyber Monday, you mentioned it
earlier. We've got the US Presidential elections
coming up on the other side of the pond. What's
going to happen? Who knows? It's a fascinating
one. Do you think? Are we seeing events like this
actually affect confidence or is it just me?
Because Ecommerce business owners, when sales get
down we obviously want to understand why and
sometimes we try and attribute it, you know, oh
well, the wind was going northwest rather than
southwest. You know we, yeah. Am I being crazy or
is there something in this across the board?
Raul Galera: So it's, you know, it's obviously in hindsight we
always try to look for answers to events that you
know, may or may not be correlated but something
that is. So I, that's, that's actually one of the
questions that we asked in the, in the latest
report was about US Elections. So do you think
it's going to have a positive, negative or
neutral impact on Ecommerce sales in Q4? And you
know I was expecting to just, you know we ask
agencies to rate it, you know, from, from 0 to
10. So you know, between 0 and 4 is negative, 5
is neutral, 6 to 10 is positive. I was expecting
fives all across the board. Like people just
like, you know, like, you know, I was expecting
that kind of neutral answer. No, I was, it was
actually mostly negative. So the majority of the
agencies responded that they are expecting some
sort of negative impact on Ecommerce sales. So
you know it's interesting we're going to, we're
going to get to publish another report right
before the, the US elections. So because we're,
we're planning, we're going to start planning the
October issue now and we're going to publish it
before November 5th. So it's, it's kind of
interesting if like the trend continues or if
it's kind of like a one time thing when you ask
people for the first time. But, but yeah. So now
answering your question, will they be right about
it? I guess, you know, we'll find out. Yeah,
we'll find out soon enough.
Matt Edmundson: Did they give you any indication as to why they
were negative in their opinion?
Raul Galera: So you know it's, it's, I think it's one of the
kind of keywords that I got the, you know, most
like most. One of the most common keywords that
we got from, from some of the responses and the
quotes that we got were, was uncertainty in
general. And so, and I'm tying that with other
conversations that I've had throughout the year
with other agencies. This is a theory that's,
that's going around that I, you know, I, I think
it makes sense because I've heard it from several
people and is that whenever there's like a major
event that takes people away from social media
platforms in which in which they're exposed to
ads. Yeah. Then Ecommerce sales go down. Meaning
that, you know, one example that. A couple
examples that I've kind of gathered throughout
the year and I've had some agencies kind of
confirm that that happened. So, you know, we all
remember. I think it was like, I think it was
like last year, right? The Titanic submarine type
of thing.
Matt Edmundson: Oh, yeah, yeah. Apparently there was a trial
about that recently, wasn't there?
Raul Galera: Yeah, yeah, exactly. So. But that was in the news
for like, like three, four days. Like two. I
don't remember. But apparently during those few
days in which, you know, we were looking for the
submarine, everybody was so focused on that or
like that was driving so much of the attention
that, you know, brands were spending less money
on ads and so there were less conversions. At
first, I found that kind of hard to believe, but
I had the same feedback from multiple agencies
and I, you know, and to be honest with you, that
was one of the conversations that got me into,
you know, starting a rapport like this because I
was like, this is really interesting. And these
are, this is stuff that, I mean, I only found out
because I was, you know, kind of having a beer
with one of these agency owner, otherwise I
wouldn't have been able to, you know, kind of get
that kind of data. And then, you know, got me
thinking, like, okay, let's. There's got to be a
way of verifying this and so, and so and tying
it, tying that with US elections. So, you know,
also during, during the World cup again, middle
of the summer World cup, like, apparently sales
in Europe were a little bit lower because people
were paying more attention to the TV down on, you
know, on social media, Instagram or Facebook or
whatnot. And so it seems like it might be the
same thing happening for. For the US Elections.
Maybe we're not we. But like in the US they're
spending more time kind of watching tv, like
maybe debates, you know, not not only candidates
debates, but like political debates on tv, you
know, checking Twitter to see, you know, what
candidates saying what. So that's also something
that I'm getting is I might be driving that kind
of. And there's a little bit of fear too. So I
feel like you are being a little. Just, you know.
Yeah. Kind of maybe afraid of spending money
until we figure out what's going on. I don't
know. But it's. It's definitely that kind of
uncertainty. It's probably the main word that's
been thrown right now.
Matt Edmundson: And it's a really interesting word, isn't it?
Uncertainty. Because you're right, I think when
we are uncertain as people, we tend to sort of
retreat into ourselves a little bit, don't we?
And so we spend less, we go out less, we do less
maybe of certain things like eat out or whatever.
Yep. And, and whilst it's interesting, you talk
about how the Titanic submarine resulted in lower
sales for some people, because it's the most
extraordinary sort of event, isn't it? And you
can you kind of go, well, it, maybe you've only
had like a very small percentage, but it actually
had some kind of impact which fascinate,
fascinates me. So you've got, you've got
uncertainty, but plus you've also got
distraction, haven't you? So you've got the
distract. And I mean, let's face it, you know,
the, the drama without getting political enough
and, you know, offending my US cousins, the drama
around the US election is, is unbelievably
addictive and, and serves as a huge distraction,
I think, in, in many things, you know, and I, I
just, I find the whole thing absolutely
fascinating in so many ways. But you're right, my
attention is there, plus my level of uncertainty.
Certainly in the uk, with what's going to happen
in the October budget, you're kind of like, well,
geez, these world events are actually having an
impact on me. So I can see how they would be
impacting a whole bunch of people, which has a,
has an effect. I don't know if you've got any
insights on this then Roll. I mean, how would
you, how would you counsel somebody who is
running an Ecommerce business right now? How do
you market well in times of uncertainty and
distraction like this? Because there's obviously
things that we can do when things are going okay,
but actually understanding the sign of the times
for want of a better expression and doing
something well in that time, well, that's a
different skill set in many ways, isn't it? And
so I'm kind of curious, is there any insight on
how to manage this?
Raul Galera: I mean, I would say, and probably saying this
because it's the type of marketing that we do at
Referral Candy, but at the end of the day, brands
that work really well are those that have a
community around them. And it, you know, it
doesn't necessarily have to be a physical
community. And by physical, I don't mean like in
person and I also mean like, you know, like a,
like a Reddit, you know, like a subreddit or like
a Facebook group or anything like that. It's
literally a community of like, okay, you've been
able to identify a group of customers that
probably even before they bought from your brand,
they identify with you. And so you know, you can
use, you can use ads to get in front of those
people. I mean you can get really good at ads
targeting and figure out ways that you can again,
like, okay, these people fit this criteria
because they have these catch different, you
know, categories and they check all these boxes.
I want to get in front of them. Yeah, but at the
same time it's kind of creating that word of
mouth. And so you know, when you have a product
that it's not necessarily generic because, and I
don't mean like the product itself but like the
way that you're selling it to people and the way
that you're kind of like framing because you
know, you can sell T shirts but you can, you can
sell a million different types of T shirts to a
million different type of people and you know,
make them see it and realize, okay, that's,
that's mine. That's, you know, that's exactly me.
Like I, you know, I definitely need this. Right.
And so again, when you have, it all comes down to
product market fit. Right? So when you have
product market fit to the point that you, you're
able to just show your customers that you have
the product that they have been looking, looking
for even before they knew that they were looking
for it, you're gonna be able to generate word of
mouth around it. And yeah, and so you know, your
customers are going to talk to other people that
are going to start, they're going to start
posting on, posting on social media, they're
going to start living reviews, they're going to
start generating all these, you know, user
generated content that you can then leverage on
other, on other platforms. So you know, at the
end of the day, obviously ads are important and
you know, obviously a lot of the messaging that
we put out on referral candy is, you know, you
don't, don't, don't, don't waste your time on,
waste your money on ads. But you need ads. But
it's all about like get the most out of it. So
once don't just spend money on acquiring a
customer and then kind of forget about it. That
customer can become your salesperson.
Matt Edmundson: Yeah.
Raul Galera: Make sure that after they buy they're so happy
and they're so satisfied with your product that
they're ready to tell their friends about it. And
even on top of that you're, you're, you know,
coming up with a Some sort of like referral
structure that makes it even bigger of a no
brainer for them to refer. So yeah, that, and
that's kind of like the long term type of
marketing plan that you want to have.
Matt Edmundson: Yeah, that. Powerful stuff. Powerful stuff. I
like this because I mean in times of uncertainty,
in times of distraction, you've got to stand out
and you've got to give people a compelling
reason. Right. And I think you can't be beige,
you can't be the same as everybody else. You have
got to stand out. So having, I love this, having
a community is a great idea. What that means for
you and your business is obviously very
interesting and very different to everybody else.
But focusing in on the community and focusing on
an expand, delivering an experience that you
know, just delivers. Wow. As we like to say on
the Ecommerce podcast, deliver. Well, I think are
always very sound old school marketing tactics
and principles. And I think you're right. I think
great ideas, you know, in times of uncertainty
and distraction. So what else has come out from
this research then? I mean what else has
surprised you?
Raul Galera: So and the latest report, one of the, one of the
findings that I found more interesting is how
brands. So you know, the report is about
Ecommerce agencies, but at the end of the day
their behavior depends on their customers, which
are brands. And so you know, by asking agencies
in extension, we're getting data points from
hundreds of other merchants. Right. So the
picture gets really interesting because you're
again kind of like using agencies as a proxy, you
can estimate how the rest of the Ecommerce world
is doing, how brands are doing. And so one thing
that I found really interesting in this last
particular report is that so we always ask
agencies what's if they've noticed any changes in
terms of prices, price sensitivity. So when you
talk to customers about, you know, renewing your
contract or negotiating retainers, whether it's a
new customer or an existing customer or
negotiating new services or whatever it is, how
sensitive are these customers to these price
changes? And that the next question that we ask
is do you see brands more likely to hire in house
or to outsource to agencies? And so in the latest
report we got a spike in price sensitivity. So it
turns out that, you know, somewhere between
August, September, brands got more, more
sensitive to price. So more sensitive to price
changes. You know, it makes sense. They, you
know, everybody's looking after their costs right
now because of, you know, inflation. Costs are
going up and so you want to keep everything under
control. You're probably your CFO is, you know,
probably questioning every single line in the
budget, like, do we really need this? Like what's
discharged? They recognize this. So, you know,
it's happening in all across the board. And so
they, they did notice a spike in price
sensitivity, which you would think, okay, well
then, you know, that probably means that, that
brands are going to hire more in house. Like
they're, they're spending less money on agencies.
You know, if they're, if they're getting, you
know, turned off by some of the quotes that are
getting, that probably means that they're going
down a different route. But when we ask that
question about whether brands are going in house
or outsourcing, we, we got a vast majority of
agencies that saying that brands are outsourcing,
that they're more likely to outsource than to go
in house. So it's, it's kind of like a paradox,
right? Like, so, yeah, agencies are getting more
exp. In the eyes of brands, but brands are still
going after them. And I think, and the
explanation that I, that I got, which again it's,
it's just, it's my own explanation, I don't know
if it's, if it's correct, is that at the end of
the day, hiring an agency has a set of
intangibles for, for brands that make it more
attractive than hire an employee or hiring a team
in house. When you're hiring an agency, you're
not only getting access to their, you know, their
skills and their team and you know, and whatnot,
you're getting access to their creative data and
collective knowledge of all the brands they work
with. So you, as a CMO of an Ecommerce brand, you
have access to one data point, maybe a couple if
you have, you know, people in the industry that
you talk to. But when you're working with an
agency and you know, you're having a, a weird
month or weird week, you can say, hey, is this
normal? And they can say, oh yeah, all of the
other brands in your vertical are, you know, kind
of seeing the same thing. Or like, hey, we're
actually seeing some trends right now. Like, you
know, you can have access to that collective.
Yeah, intelligence, I would say that I feel like,
makes it really powerful than hiring in house.
Obviously, you know, hiring in house and versus
an agency has. It also depends on, you know,
what's the pricing model that the agency is going
after. Are they taking a commission on revenue?
Are they charging a flat fee? But, but again, I
thought it was interesting that there's like this
paradox of brands are going with agencies Even if
they find them more expensive, at the end of the
day, they're still settling for, for outsourcing
versus going in house.
Matt Edmundson: Yeah, it's fascinating, isn't it? And I get on
one hand how that would be a paradox, you know,
and. But on the other hand, I guess one of the
things I am noticing is obviously ecom companies,
they're cutting costs quite a bit. Everyone's
becoming very cost conscious because it's. There
has been so many price hikes. It's actually quite
complicated now, I think, to rise. I'm not saying
you shouldn't increase prices, but I think people
have increased prices but still need to manage
costs. And so they're looking in, you know,
internally at how to do that. So I can see them
going, actually, we spend four grand a month with
that agency. Can we find an agency where we spend
three grand a month and get the same output?
Right. So I can see why people would ask that
question. But I guess I also see how internally I
might say, well, I need to hire two new people.
Right. So real life example, I suppose at our
company, I'm looking to hire two people at the
moment. It's a very real question now to ask
myself, well, do I actually want to hire somebody
or can I outsource this work? Right, right. And
so I'm, I'm looking at my own cost base and
going, right, what do I actually do in house and
what can I outsource? And so I can see how this
creates this sort of paradox. I'm looking maybe
to outsource more because I want to keep my
internal costs down, but in outsourcing more, I'm
going, oh, I'm not, I'm not happy with four grand
a month, dude, I need it to be three, you know,
that kind of thing. And I, I've seen that a lot,
actually. I've seen that a lot. I've seen
agencies, especially freelancers, so agencies
where it's just maybe one or two people, you
know, just sort of doing the ad spend and things
like that. I, I've seen them getting squeezed by
companies and because they are one man bands for
better, you know, their soul. And it's just them
really, that's why they're freelancers. It's
really hard to. Unless you're full on with work.
It's really hard to go, okay, I'll just drop my
prices for you, rather than just turning around
to them and saying, oh, well, if you don't want
to pay, go somewhere else. It's not actually an
easy thing. To say, is it. If you're a
freelancer, it's easier, I suppose, if you're an
agency, but even then everyone's a little bit
twitchy at the moment. So again, coming back to
your uncertainty observation, I think that's
interesting. I do think that's interesting. I'm
kind of. Go ahead.
Raul Galera: I was gonna say, I think it also has to do maybe
with the learning curve. Curve. Because
especially at this time of the month. Sorry, at
this time of the year, if you are in that
position and you're an ecommerce brand, you know
that hiring an employee, you're probably not
gonna see any results anytime soon. Cause they
need time to ramp up. Agencies need it too. But
agencies usually come with SOPs and they're ready
to deploy almost because it's for them. It's sort
of like, this is literally my everyday. This is
literally what I do every single day. Like
you're, you know, you as a brand, you're probably
not that different from the 15 other brands that
I work with. So maybe that, that speed factor
might be an aspect that brands value over hiring
in house.
Matt Edmundson: Yeah, it's an interesting one. I was going to
say, I'm kind of, I'm curious also whether
actually the traditional agency model that we've
experienced the last few years, whether that
actually needs to change as well. I appreciate
this is a much deeper conversation.
Raul Galera: Yep.
Matt Edmundson: Than what we're thinking, but I, I've not. We
have an agency, right. A media agency. And we
went down the traditional route of this is our
service, this is our retainer. You pay the
retainer, we do the service. The problem I think
people have got is, and this is my experience in
using agency, is that when you go to an agency,
you get a great service at the start. But if that
agency is good, they're going to grow, they're
going to get more clients, and the people that
are good for you are now going to be good for
three people, four people. And so the quality of
work for you gets less and less, the feedback
gets less and less, you get annoyed and then you
end up going to another agency and the whole
process repeats itself. One of the things that
we've done, and I can't give you any hard data
yet, Raul, I'm not going to lie because I just
don't know. I'm intrigued to see the results with
one of our agencies is we have gone to the market
and we've said, right, listen, this is the work
that we're going to do. This is the fee for that
but at the end of a predefined period, which in
this particular industry is going to be, I think
about five months, at the end of those five
months, your staff will be trained on our
processes and we'll be able to do a chunk of the
work. So we will help you get up and running and
we will train your staff. Now if you don't have
staff, we will carry on doing the work for you
under the traditional retainer model. But if you
do, we will train them and we will move from
doing the everyday work into a much more sort of
consultative coaching role to make sure the staff
stay on top of things and, and go forward. The
initial response to that actually has been really
positive. But like I say, it's all anecdotal at
the moment. And so part of me wonders in the
midst of all of this, whether the agencies which
change their models to whatever it is, maybe
could find a way to win.
Raul Galera: Yeah, I've, I actually had a similar discussion
last week with Jordan West.
Matt Edmundson: I know Jordan, he's a legend. He has been on the
show.
Raul Galera: Yes. Oh yeah, I saw, I saw actually so, and you
know, he, he mentioned actually so I was on, in
his podcast and I was asking him so many
questions that at some point I felt like I was
the, the host. But, but one of the, one of the,
so we were talking about this particular question
about the retainers and the in house versus
outsourcing. He mentioned that, that agencies,
when they do like a, like a kind of performance
based or like, you know, revenue based type of,
you know, get a commission on the revenue Lyft or
something like that, that at some point if you do
too well, it will get you fire as an agency.
Matt Edmundson: Yes.
Raul Galera: Because you'll have the CFO saying, wait a
minute, 30k. Like, oh sure, you know, we made,
you know, I don't know if these were the numbers
that he mentioned. I'm sure it was just like, you
know, kind of just relatively figures. But you
know, if you make a brand generate a million
dollars and you get 30k out of it, 3%, sure.
Great. You know, you've, you've made the brand
get a million dollars in revenue, but they're
going to see a 30k bill and the CFO in question
is going to say, wait a minute, do we really need
to spend 30k on this? Because obviously. And
again, it's the same thing that we were talking
about earlier. In hindsight it looks pretty easy.
It's like, oh, okay, well this agency got it for
30. There's gotta be an agency that maybe gets a
little bit less, but we pay a lot less. Right.
And so, and I feel like that's a raw mentality,
but at the end of the day in a company, you have
a ton of different stakeholders. The CFO has one
job and you know, and it's, it's also, you know,
I think it's also the CMO or the CEO job of
saying, no, no, no, you know, we, we need us,
we're not. We wouldn't be able to get where we
are. But again, in hindsight, it always makes it
a little bit more difficult to see. But yeah,
that's so, you know, answering your question, I
don't know, I don't know what's the ideal pricing
model when again even like what it could be
considered like the most fair type of approach,
you know, can also. And you know, we've seen our
referral candy too. I mean, referral candy, we
take a commission on refer purchases. So on the
revenue that the referral program generates.
Yeah. At some point we get questions. At some
point it's, you know, when we are able to help a
brand get to a certain size in the referral
program, some of them have question of like,
well, whether, you know, I'm paying a lot. Like,
you can prove what you've generated, but the bill
is there, the invoice is there. And so I can see
how it can generate that kind of situation.
Whether it's a brand talking to an agency or a
brand talking to an app.
Matt Edmundson: Yeah, absolutely. It's really fascinating, isn't
it? I mean, the whole thing just. And if you're
listening to this and you're an Ecommerce owner,
then, and you know, having sat on both sides of
the fence, having been and still running agency
and having been and still running my own
Ecommerce businesses, I get to see it from both
sides. I really do. And I think that I would
just. Probably the best advice I could give you
is just communicate well and ask lots of
questions. Don't let the anger and resentment
build up, have the conversations early. And I
think agencies are learning more now to adapt to
that and I think it's an important thing to do.
And of course, I mean, you mentioned Jordan West.
He was on the show. We were talking about TikTok
shops and he was on the show, I think, back in
May, if you want to check out that episode, Dear
Listener, it was a great episode. He's again such
a legend. He and I are on WhatsApp all the time,
just chatting away. He's such A good guy. So I'm
curious to hear that conversation you had with
him. If I'm honest with you, Raul, I'm going to
listen to that one. Speaking of questions. Right.
One of the things I like to do in the show, which
I say like to do is a more recent thing that
we've been doing is ask a guest for a question.
For me, this is where I ask you for a guest. I'm
not going to answer it now. I'm going to answer
it on my social media platforms. So this is my
little trick, my little come and join me on
social media thing for you, dear listener. Raul,
what's the question?
Raul Galera: Well, we kind of talked about it earlier, but I
want to get your full answer on this. How do you
see the US elections affecting Q4 sales?
Matt Edmundson: Fantastic. If you want to know how I see the US
election affecting Q4 sales, then come join me on
social media. You can find me at edmondson, both
on LinkedIn and Instagram and I'll be posting the
answer to that and the other questions I've been
asked soon. So, yeah, do come, follow me. Well,
anything else in closing? I mean you've, you put
this together every month. Is there anything else
in the data which you found, which you've kind of
gone, that's a little bit surprising?
Raul Galera: I don't know if it's surprising, but it's just
something I like and that. So the last question
that I ask, the last two questions that I ask
agency owners are, you know, how you see your
agency's revenue looking like in the next six
months. And then also how do you see
opportunities in the Ecommerce world looking like
in the next six months? So it's more like, you
know, just let's predict the future, right? Like,
how do you see it working? And you know, even
when we were having like months with like, like
negative responses on marketing budgets, on price
sensitivity, on you know, on different, like
different aspects that we ask agency owners,
those answers were always positive. The answer is
kind of, what's the outlook? You know, it does
not surprise me. And I've talked to a few people
about it and they say, oh yeah, like, you know, I
mean, and you know, the majority of our owners
are entrepreneurs. They have to be positive.
Matt Edmundson: I mean, it's got to be optimistic.
Raul Galera: Exactly, exactly. So that's something I
particularly love. And so again we, you know,
this, this month was no difference. I asked, you
know, how do you see the US Elections playing
out? How you see, again, we talked about the
marketing, but marketing budgets were up, but
because of Black Fridays every Monday
preparation. But again we talked about price
sensitivity and all that and. Yeah, but how do
you see everything looking like in six months? Oh
no, it's amazing. So I mean I love it. I mean
it's. And to be honest with you I'll be worried
the day that I see negative outlook in that.
Matt Edmundson: That's true. Yeah. Because then you know you've
got, if the entrepreneurs are downbeat you've got
a real problem, haven't you? Yeah. I think that
there is a blind optimism, isn't there with
entrepreneurs And I actually quite like that
because you need people who go no we, this is
going to turn around, we can, we can do something
here, there's opportunity for us, let's go take
the hill. When everything around them is
collapsing, you know and there's something quite
magical if not self denial about that. It's one
of those and I think you need people around you
like that. And agency owners especially and I
think Ecommerce entrepreneurs cut from the same
cloth when you talk to an agency, if I go and
talk to an adwords agency, give them my account
details, they're going to look at that and go
man, we can totally kill this for you. Right?
They're going to say, they're going to say that
because that's what they're going to say because
that's what they actually believe and think if
they didn't, oh mate, we can't beat that. Or may.
It's just downhill from, for you from here, isn't
it? It's that kind of actually you need that,
that sense of positivity. The danger of course is
you oversell and under deliver and you get caught
up in that excitement, don't you? And so I think
as Ecommerce entrepreneurs we, I listen to agency
owners and I'm like, I just need to filter what
they're saying because they're passionate,
they're excited and then there's a reality of
life.
Raul Galera: Yeah, yeah. I mean you're, you know, you're,
you're selling and I do a lot of sales calls,
referral candies. So like if you're, if you're an
Ecommerce store and you request a demo, there's a
chance that I'll be the one that's on the other
side of the screen and you know, you, and you
gotta, I mean you gotta believe in what you're
selling.
Matt Edmundson: Yeah.
Raul Galera: You gotta believe in what you're, what you're
capable of doing, you know, whether it's an
agency or an app. So I totally get that. And you
gotta have that optimism.
Matt Edmundson: Yeah, yeah, you do now. I love it, Love it. Well,
listen, man, if people want to reach out to you,
I mean, you've mentioned it at the start of the
show, but let's talk about it again now. If
people want to reach out to you, if they want to
connect with you, what's the best way to do?
Raul Galera: If they want to email me, it's
raul"referralcandy.com and if they want to check
out the report, that's referralcandy.com/eaci,
which stands for Ecommerce Agency Conference
Index.
Matt Edmundson: Yep. And do check it out. I mean, I've read
through the September report is very, very
insightful.
Raul Galera: Thank you.
Matt Edmundson: And yeah, really, really well put together
documents. So do sign up for that. Do go and get
that. It is free to access, so go check that out.
And of course, do connect with Raul if you've got
any questions, even if it's just to say hello,
I'm sure Raul would love to hear from you. And of
course we will link to everything that Raul has
given us in the show notes as well, which you can
get with the transcript and all that sort of good
stuff. You can get it on the website
ecommercepodcast.net and of course, like I say,
you can get it in the show notes to scroll down
on your app. And if you sign up to the
newsletter, that'll be coming to you anyway, just
automagically. Well, listen, man, it's good to
see you again and good to chat again. We should
do this more often.
Raul Galera: Definitely not every three years. Probably in a
few months.
Matt Edmundson: Maybe let's get you on sooner next time.
Raul Galera: Sounds good.
Matt Edmundson: But genuinely, thanks for coming on, man. Really
appreciate it. Thanks for sharing the insights
and love what you guys are doing and thanks for
putting it out there. Thanks for making it free
for people like me to get some insights. Really
appreciate it.
Raul Galera: Yeah, thank you. And thanks for having me again.
Matt Edmundson: No worries. What a great conversation. Huge
thanks again to Raul for joining me today. Now be
sure to follow the Ecommerce podcast wherever you
get your podcasts from because we've got some
more great conversations lined up and I of course
don't want you to miss any of them. Why would I?
I wouldn't. And in case no one has told you yet
today, let me be the first. You are awesome. Yes.
You are created awesome. It's just a burden you
have to bear. Raul's got to bear it. I've got to
bear it. You've got to bear it as well.
Raul Galera: Now.
Matt Edmundson: The Ecommerce Podcast is produced by podjunction.
You can find our entire archive of episodes on
your favorite podcast app. The team that makes
this show possible is Sadaf Baynon and Tanya
Hutsuliak. Our theme music was written by Josh
Edmundson, and as I mentioned, if you'd like to
read the transcript or show notes, simply head
over to the website ecommercepodcast.net where
you can sign up for the weekly newsletter and all
of the good stuff gets delivered straight to your
inbox. Totally for free. But that's it from me.
That's it from Raul. Thank you so much for
joining us. Have a fantastic week wherever you
are in the world. I will see you next time. Bye
for now.
Raul Galera: SA.