Cemoh120: Jeremy Gillespie on Crafting Irresistible E-Commerce Offers To Increase AOV & Conversion Rate

Helping brands scale with performance paid advertising. Simon Dell speaks to Jeremy Gillespie, founder of Built To Scale - Growth Agency, about the performance-based model and crafting irresistible E-Commerce offers to increase AOV & conversion rate.

Transcript

Simon Dell: So, welcome to the Cemoh Marketing Podcast. We have with us today, Jeremy Gillespie from Built To Scale, who is based in sunny San Francisco. Try saying that after a few drinks. How are you, Jeremy? Welcome to the show. And how are you?

Jeremy Gillespie: Doing well, doing well. Thanks for having me. Glad to be here.

Simon Dell: Is it sunny in October, in San Francisco?

Jeremy Gillespie: Today, it is. Yes, today it is. But last month, not so much.

Simon Dell: I was going to say I’ve been to San Francisco, mainly in the winter, and fuck, it’s cold there in that time of the year. Yeah, that’s not – yeah, not pleasant. Whereabouts are you in San Francisco?

Jeremy Gillespie: I’m right near Golden Gate Park. So, in the city proper.

Simon Dell: Lovely, lovely. So, just tell us a little bit about what Built To Scale does, because you’ve got a very, very clear proposition for anyone that wants to go and have a look, www.builttoscale.co. Give us the elevator pitch of what you do.

Jeremy Gillespie: Yeah. Short and sweet, we help brands scale with paid advertising. We do performance-based paid advertising. So, our goal is to get paid when others are getting paid and they’re making money. So, we specialize in Google. We do a ton with YouTube ads. We also work with Facebook and Instagram. So, we’re a multi-platform agency. And really, over the last four and a half, five years here with the agency, we’ve had a lot of success.  

And I’ve just embodied the performance model because I think it’s A, fair and B, when things are going properly, everyone makes a lot more money and everyone’s a lot more happier. And it’s a true partnership, rather than the agency-client relationship that a lot of people have.

Simon Dell: How does that work? Because, you know, we might have people watching this who are agency background. I mean, I’m agency background. A lot of my staff are agency background. How do you build a model that is – so, they only pay you when they succeed or when they sell something, right?

Jeremy Gillespie: Yep. Yep, exactly.

Simon Dell: Explain to me how that works, because that would obviously scare the shit out of a lot of people.

Jeremy Gillespie: Yeah.

Simon Dell: It would scare the shit out of a lot of agency people. It would be great for, you know, the other side of things. But yeah. 

Jeremy Gillespie: For sure. Yeah, it definitely does not come without its ups and downs. But we look for good brands who have good products that are looking to scale, and they have a proven funnel. And so, for us, we basically build a baseline based on their current metrics to understand what is profitable and what isn’t, and we use that as our baseline. So, for a lot of clients, if we don’t feel comfortable coming in on an original performance, we’ll do a 30-to-45-day baseline period where our goal is just to understand what are the performance of these campaigns? Where are we currently at? Where do we think it can go?  

And then we basically set a KPI. And so, we say, “All right, great. Here’s our KPI. We want our return on ad spend to be X. And we don’t get paid unless it is greater than or equal to that return on ad spend.” And so, for clients, it’s great. For us, we have to work for kind of what we kill. But when it’s working, we kill and we eat. We eat a lot during those times, and that’s what we love to do.

Simon Dell: And I guess there’s probably a bit of a gap between you starting working with a client and actually generating income for yourselves, isn’t there?

Jeremy Gillespie: There is. Yeah, I mean… So, first of all, we say it’s definitely been a work in progress, but we say no more than we say yes. We’ve definitely been caught where we say, “Yes, things look good from an outside -“

Simon Dell: Yeah.

Jeremy Gillespie: But it really becomes a due diligence play rather than somebody coming in and saying, “Let me look at all your case studies as an agency. Let me see X, Y and Z.” It goes both ways because we get into the data and figure out, “Is this going to work for them?” So, it depends. Like, if we do that baseline period, we have a fee up front for us to find that baseline. And then we basically say, “Okay, cool. Now we’re going to graduate into phase two, which is performance-based.” If they have good numbers and we feel good about it, we jump right into the performance-based.  

I would say it’s about 50-50, who goes to phase one and who just jumps to phase two. Certainly, with all of the iOS issues and things like that, we’re going more with phase one here in the last, I would say, 3 to 4 months because we just want to make sure that’s going to be a good long-term relationship. And again, we’re not working 60 days for free to try to figure something out that they haven’t been able to figure out themselves.

Simon Dell: And in that phase one, so you’re charging them a fee for that phase one. So, you’re doing your due diligence, you’re assessing – you’re looking at Google Analytics, blah, blah, blah, all that kind of stuff.

 

Jeremy Gillespie: Yep.

Simon Dell: And is that price that you’re charging them based on a flat fee? Is at the same for everyone or it depends on the size of the business, how do you kind of work that out?

Jeremy Gillespie: Yeah, we kind of take that as like, almost a setup fee. So, we do a flat fee, or percentage of spend. So, we do want to make sure that if they’re happy and they’re making – within that first, say, 30 to 60 days, they’re making really good money, then we want to make sure we get maybe a 7% to 10% of ad spend on top of that fee.

Simon Dell: So, that’s your income, then. Is it is your income generated from ad spend or revenue earned from the client?

Jeremy Gillespie: Yeah, I’ll just break it down so it’s crystal clear. We have two models. Basically, we do percentage of spend if a KPI is met, or we pay for the ad spend. And we charge them on a CPA or CPL basis. So, you’re going to pay us $75, $100 cost per acquisition. It’s our goal to put our money where our mouth is and make sure that we’re paying less than that in ads. 

Simon Dell: Of course. So, if your cost per acquisition is $20 and you’re charging them $50 per cost per acquisition, then hey, presto, you’re making $30 every time they get a new client.

Jeremy Gillespie: Exactly. And we don’t… I guess we’re not shy about how we make money. So, we make sure the numbers make sense for them, but we’re also not shy at showing them the data that’s going on as well. Because again, it’s a partnership and we want them to be happy. If $50 cost per acquisition is making them happy and we’re getting leads or sales for $10, you know, less… We’re happy as well.

Simon Dell: So, most of your clients are US-based or do you sort of have people around the world or… You know?

Jeremy Gillespie: Yeah, definitely mostly US-based. We have a few in Australia as well, but definitely mostly in the US. US-based, but then we’ll do kind of the top five countries from an ad standpoint. So, Canada, UK, Australia, New Zealand, US.

Simon Dell: Okay, let’s talk about the actual channels because obviously, when you look on your website, you talk about Google, you talk about Facebook, you talk about Instagram. Are you predominantly focusing on B2C brands? You know, it strikes me that what you do is you get up for e-commerce brands that people buy online, those kind of things. Is that 100% of your business or is it sort of split different types of businesses?

Jeremy Gillespie: It’s a little bit split. So, we definitely have like an e-commerce side, I would say that’s about 50%. Then we have we have a lot of high-ticket funnels as well. So, coaches and consultants that are bringing people through webinars and are converting them into high ticket sales. And then the third part, which is getting much bigger very quickly, is just cost per lead.  

And so, those are some sort of service provider. I categorize them different than high ticket because these could be solar companies, plumbers, you know, debt consolidation, everything like that that they’re just looking to capture the lead and pay a flat fee on that lead.

Simon Dell: Okay. What do you think – I mean, obviously, you mentioned, I think, obviously worth talking about the iOS changes and things like that. That’s obviously impacting everybody from a pay-per-click perspective and tracking and all those kind of things. What do you see as the best return at the moment in terms of the channel? If you could only spend money on one channel, what would it be?

Jeremy Gillespie: Great question. I would say up until probably a month and a half ago, I would say 100% YouTube. That or Google. Google in general is kind of where I would put my money. YouTube has been really amazing. There’s been some shifts and actually, this… Yesterday, actually, they came out – they’re penalizing longer form videos, giving them higher CPMs. So, actually, for the last 15 days or so, we’ve been paying – sorry to get into the weeds – we’ve been paying really high CPMs. We run a lot of long form video, and the CPMs have been brutal.  

And so they finally came out and said, “Hey, this is – we’re actually penalizing these videos. And so now, there’s a shift.” So, it’s been a little bit rocky, but from a scalability and sustainability standpoint, YouTube has been amazing. And once you get it going, it goes really well.

Simon Dell: I guess that’s probably… You know, the YouTube – the shorter video thing is a hangover – not a hangover, a reaction to TikTok and the growth of those 60 second videos on TikTok. Talk to me about TikTok. Is that becoming a viable channel for you? Do you see much success through that?

Jeremy Gillespie: Absolutely. Yeah. And we’re testing a lot more there. I would say if I had a pie chart in January of 2022, I think Google is probably going to be 50%-ish, if not more of the spend. There’s going to be about 25% to 30% in TikTok, and then it’s going to go… The rest will be on Facebook, Instagram, but I think TikTok is going to take over Facebook, purely for me because of the performance base. The costs are currently better over there.  

The one issue is demographics, depending on who you’re going after. If you’re in your 45 to 65+ demo, that can be very difficult there. If you have a young, female-focused skincare brand, well, you know, that’s something that can definitely work.

Simon Dell: Yeah. Well, let’s then talk about the opposite end of that platform when you’re talking about young, female-focused skincare brands. You know, one of the big target markets that a lot of businesses are trying to chase is that kind of older decision making, you know, kind of angry, angry, angry white man demographic, that one of my clients describes them as. And then lumped me in that as well, and I’m like, “I’m not that angry.”  

Where are they? I mean, is that a LinkedIn thing? Do you use that much at all? Is that – you know? Or is that sort of still the YouTube and the Google side of things?

Jeremy Gillespie: I mean, YouTube and Google is great if you’re looking – you know, I would say 45, but definitely 55+ white male, Google’s amazing. I mean, you get into Google Display and YouTube, specifically display on here in the US typically, you would say more conservative news sites or just news sites in general. LinkedIn, I mean, I didn’t go through the full background.  

I used to work at LinkedIn, help them build out their Off-LinkedIn paid advertising strategy, and has spent a ton of time as well as money on LinkedIn. LinkedIn is great when you’re doing B2B and you’re going after decision makers. If you’re doing like, ABM targeting, stuff like that, it is very expensive, though.

Simon Dell: Yeah, yeah, I’ve noticed that. Yeah, you can bleed a lot of cash very quickly through LinkedIn.

Jeremy Gillespie: Yeah, yeah. You’re paying $12, $15 a click. So, yeah, it gets really, really expensive, but you can reach the right audiences. So, it has its trade-offs depending on the product or service.

Simon Dell: You know, obviously, a lot of the success of this is based on the offer or the product or what it is you’re advertising. And again, if you’re advertising makeup, that’s fairly obvious. Comes to the website, they buy it, it’s delivered. You know, that’s a fairly simple process. B2B is obviously a lot harder. What do you find… You know, and you’ve mentioned a couple of things in your conversation there. You mentioned plumbers for one, which is – you know, I’d like to touch on that in a second, and then talking, go back to the angry white males, but let’s talk about plumbers.  

What is it that you put in an offer? What’s in the communication to a plumber? Because plumbers aren’t going to watch a webinar, and they’re not interested in, you know, discounts, or are they? I mean, maybe I’m misinterpreting the needs of the average plumber. But you know, what do they want?

Jeremy Gillespie: So, I think that was a bad example. So, getting leads for like, a plumbing company?

Simon Dell: Sorry. I mean, yes. Yeah, okay. So, for somebody who’s interested in a plumber, yeah, not actually for the plumbers. But what are they advertising? Yeah. What were they – you know, what’s the hook?

Jeremy Gillespie: Yeah. I mean, you know, typically, that is that’s a local-based ad. So, you’re looking for top plumbers in “insert geographical location.” To be candid, we don’t do a ton of that, but what we will work with is like a national aggregator that will then sell those leads out to local. So, we won’t do the local stuff, but we’ll sell to the national aggregator that will sell them out. 

Yeah. And a lot of it is, you know, fast, reliable. You have their Google rating, stuff like that. So, that’s more of a trust thing. As well as with Google, it’s just a timing. You know, if they’re searching for specifically “plumber near me,” what have you? We’re just trying to capture that intent and take a dollar or two on the way over.

Simon Dell: So, in that sense, you know, if you were looking at a state like Queensland, which is obviously a big state, you might be running a campaign across the whole of Queensland, and then you might be getting, say, 5 or 10 leads in four plumbers on any given day. And you’re then pinging them out through the aggregator to the local plumber, and they’re buying that lead from the aggregator.

Jeremy Gillespie: Exactly. Exactly, yep.

Simon Dell: All right. So, that communication… Yeah, that’s somebody who needs a plumber. There’s normally an instant need. It’s not like you’re um-ing and ah-ing about, “Oh, maybe I’ll get a plumber,” or, “I don’t get a plumber.” But you know, back to our sort of angry, middle aged white men, what do they get? They’re notoriously… And by all means, correct me if I’m wrong, but they’re notoriously slow, or process-driven in that decision making that they want to do the research, that they may not – they may be looking for something in March, but may not necessarily be actually looking to buy until May.  

Or, you know, like a business might need a new accountant for an accounting firm or, they might decide that they need a new website. But that purchase isn’t necessarily, “Hey, I want it today.” It’s not like a broken pipe or a tap that’s not working. What are you saying to them? What’s that messaging of the offer that goes out to that target market that’s peaking their interest?

Jeremy Gillespie: Yeah. I mean, if it’s a considered purchase, something that is going to take time and nurture. Typically, we will… We’ll focus just on the lead piece rather – rather than getting paid on the sale, we’ll try to get them with some sort of lead magnet or offer that’s going to get them into their funnel, where they’ll be nurtured or called by their sales team, and worked through the process.  

For that demo, though, financial products work really well. And you’re typically doing like, a lead magnet or something to get them to basically give away their information, or then they’re going to be put on this nurture sequence. They’re going to go to the sales team where they’re going to be called and talked about, say, investment strategies or what have you.  

But typically, for that audience, you’re not selling the main thing that they want until later. You’re trying to get them in through some sort of low-cost tripwire or front end offer to get them… To have them raise their hand and show intent. And then the back end will work its way.

Simon Dell: Okay. And then sort of finally, touch on… All of the stuff you’re doing must… Oh, I would assume most of the time, it’s dependent on a level of marketing automation in the background, some software that’s driving emails and collecting emails and sending out communication and those kind of things. Are you implementing that or do you sort of – are you working with what our clients potentially already implemented?

Jeremy Gillespie: Yeah, it’s a great question. Typically, we have our – definitely our hands in that strategy. I would say since 2021, that’s become a much bigger piece of what we do. So, it typically was like, creative media buying go ahead and do your thing. But with these fluctuations, the way that the landing page design and the automation that’s set up behind it is becoming much more important. And it’s going to – I need it to back out for them so they can continue.  

I can’t – right now, I don’t think there’s anybody that we’re like, “Yeah, we can bring down your CPA a little bit.” You know, things are going… Costs are rising, so CPAs are not going down. So, you have to get more efficient through the funnel somewhere. And so, it’s much more on the funnel of the automation, and how you monetize – how much you can monetize them for. Yeah, so we’re getting much more involved in that. I like that. I like the strategy behind that. Personally, I hate to get into the weeds of setting up tech, though, so I’ve hired some people to support that just because it’s not my forte.

Simon Dell: Yeah. And I guess my thing, my final question there is that you must see a lot of marketing tech. What do you like? What do you guys use? What drives you guys from a – you know, just even internal project management, what are the pieces of software that you guys rely on?

Jeremy Gillespie: Yeah. I mean, internal project management, we’ve used them all. It’s funny. You use them all and you find out, “Oh, you’re the problem. It’s not the software.”

Simon Dell: I’m told that many – I’m told that many times, Jeremy, by the rest of my team, especially my business partner. It’s me that’s the problem. It’s not the software.

Jeremy Gillespie: Yeah, we use ClickUp for project management.

Simon Dell: Yeah, we use ClickUp as well. So, yeah.

Jeremy Gillespie: You know, tracking is a much bigger piece here now. So, we use Hyros, we use Wicked Reports for tracking as well, testing out some other tools. You know, candidly, none of them really blow my socks off when it comes to like, giving me the insights that I need. And that’s where there’s some – hopefully, some other things that are coming out.  

And then for us, from a creative standpoint, just having a strong creative team, it’s not necessarily like a product, but having a strong creative team that’s going to pump out creatives on a weekly basis, or depending on how much you’re spending more than that.

Simon Dell: Last couple of questions, then. So, what’s next for you this year? I mean, we’ve only got three months left of the year. What’s the… Anything sort of big happening this year or any big plans for next year?

Jeremy Gillespie: I mean, definitely just the queue for Black Friday, Cyber Monday push for the e-com brands. 

Simon Dell: Of course.

Jeremy Gillespie: And I mean, big, big, big on my list is TikTok and figuring out that platform. I think that’s where a lot of money is going to be spent in the next 12 months. And you know, if I look back over my career, I was fairly, fairly early, you know, 14 years ago in Google, and then started in Facebook, but didn’t get heavy into Facebook until probably it was at like, the height of the bell curve. And so, I definitely want to catch this wave earlier.  

So, that’s what piquing my interest currently, as well as figuring out some new funnel designs that I think the market is shifting in how they interact, and that experience is what I’m interested in. So, yeah, that’s kind of where my head’s at.

Simon Dell: Okay. Last question then. Who’s doing it well out there? You see a lot of brands… I mean, maybe you’re working with them, but maybe you’re not working with them. But who do you – you know, who’s the benchmark that you guys aspire to be out there like?

Jeremy Gillespie: I mean, it’s really tough. Like, from an education standpoint, Masterclass, I think, does a really, really good job, especially with their ads and advertising.

Simon Dell: Is that the one that’s owned by… What’s his name? I can’t remember. What Masterclass… What is that? Is that a training software, or am I thinking of something –

Jeremy Gillespie: It’s not a training software, but it’s like a training learning platform. So, you go there to learn. 

Oh, okay. Yes, yeah, yeah. 

Yeah. But you know, then on the kind of the D2C side, you know, I like – I really like the Magic Spoon, Cereal School, like the keto brands. They’re having fun with the brand. It’s not just a standard kind of keto funnel or consumer product brand, they’re having fun with it. Those are the kind of the brands that I look up to that are… Nugz is another one.  

But you know, the one thing I think that’s interesting on the D2C side, not to ramble on this question, is like how dynamic it is and how fast it’s changing. Because I – like, all of those brands, or brands that I would say, you know, kind of hit their stride probably 6 to 12 months ago, and now you’re just seeing new waves of new ones.  

And so, it’s ever evolving. The last thing I want to say on that, though, is that I think when it comes to D2C brands, the content piece and the community piece are things that are really setting brands apart. Like, if you can build that community and that content around your brand to continue to engage, that’s what’s really the magic, currently. It’s not just, you know, throw up an ad, let Facebook do the work and ride off into the sunset. It’s really building a true brand that provides long term value to their customers.

Simon Dell: Jeremy, thank you very much for your time today. I really do appreciate it. A lot of interesting information, a lot of potential challenges there for people owning agencies out there, to try and do things a little bit of a different way. So, look, really appreciate it, and thank you for being on the show.

Jeremy Gillespie: Yeah. Thank you, Simon. I’m happy to chat anytime. So, thanks for having me.