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210: Why Some Brands Scale Up While Others Flop

Posted by Austin Brawner on July 30, 2019

 

Some ecommerce brands make it big while others stall out, it’s a fact.

But there’s really no big mystery behind why this happens.

A few months ago I was interviewed on a podcast by my good friend Brett Curry on the Ecommerce Evolution Podcast. We break down what separates e-commerce brands that scale up versus those that plateau.

After re-listening to the episode, I decided to share it with you. Brett and I talk about a variety of things, including average order value and lifetime value, and how that directly impacts your ability to scale up. We talk about demand generation versus demand capture: which is “better” and which lends itself to being able to scale. We talk about the roadmap to building a team and scaling up your business, how your role as a CEO changes as you grow, and much, much more.

I had a great time chatting with Brett, and I hope you enjoy!

Episode Highlights

  • 8:25 Why I’m so passionate about dissecting why some brands scale and others don’t.
  • 9:56 The KPIs that separate the businesses that can scale from those that can’t.
  • 11:18 Demand capture vs. demand generation and which one will allow you to scale.
  • 14:51 Factors I look for when evaluating a product’s potential for growth.
  • 16:53 How a passionate market can contribute to success.
  • 21:03 Why having competitors in your market is a good thing.
  • 21:44 Average order value and lifetime value: why they’re important and what to look for if you want to scale.
  • 24:48 How to evaluate CPA across different channels and the other metric I recommend examining.
  • 27:30 It’s OK if your business doesn’t scale — and this is why.
  • 30:28 Growing your business by expanding your product line.
  • 34:20 A true entrepreneur falls in love with their customers, not their product.
  • 35:47 Great founders know when to ask for help.
  • 37:17 Why business founders need to become experts at their marketing channels before handing over the reins.
  • 41:23 How a CEO’s role shifts as the company grows.

Links And Resources

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Head over to JointheCoalition.com to learn more. Can’t wait to see you inside.

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Transcript

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Austin Brawner: What's up everybody? Welcome to another episode of the Ecommerce Influence Podcast. My name is Austin Brawner, and I have a very special exciting episode for you guys today. I was interviewed a few months ago on a podcast by my good friend Brett Curry, and it was a great interview. I thought that he asked a bunch of great questions. We had a very interesting conversation, and I asked him if we could replay it here for you guys. He said yes, so today you're going to get a very special episode. It's just going to be an interview with me, and we are going to be diving into the question, what separates e-commerce brands that scale up versus those that stall out and plateau.

In the whole episode, we went through a bunch of different stuff, but we talk about average order value and lifetime value, and how that directly impacts your ability to scale up. We talk about demand generation versus demand capture; which is "better" and which lends itself to being able to scale? We talk about the roadmap to building a team and scaling up your business. How your role as a CEO will change as you grow. We talk about hiring, kind of how and when to hire an agency, and what I've noticed about companies that have had good success with agencies versus the ones that have had really bad experience with agencies.

We talk a little bit more about, kind of dive into single SKU businesses and what's different and the same about those businesses and what you're going to have to deal with. Really good episode. I think you're going to get a lot out of it.

Before we dive in, I want to make an official announcement. We have not one but two upcoming events coming your way. Two profit summit intensive workshops. The first one is going to be in Boston, September 22nd through the 24th. The second one is going to be in Los Angeles, October 2nd through October 4th.

We are officially taking our intensives back on the road. We've done about the last four of these in Austin, Texas. Taking them back on the road, heading to the coasts, and the focus of each of these workshops is going to be preparation for quarter four. We're going to be diving in, small groups, 10. There's going to be actually only 10 seats available at each event.

We're going to spend two and a half days working on your business, building out systems to help you have the most profitable Q4 that you've had yet.

We're going to be diving into email. We'll be diving into Facebook audiences. We're going to be diving into onsite targeting, and really making a plan to be able to have the most successful Q4 yet. It's going to be a great event. Again, October 2nd through the 4th in Los Angeles. September 22nd through the 24th in Boston.

If you want to learn more about that event, we have early bird pricing running through August 20th. If you're listening to this before then, you should definitely check it out at brandgrowthexperts.com/intensive. Again, that's brandgrowthexperts.com/intensive.

Hope to see you guys there at one of the events. Without any more chatter, let's get in to the episode.

Brett Curry: With that, Austin, man, thanks for taking the time. Thanks for being on the show.

Austin Brawner: Brett, thank you for that incredible, incredible introduction, man. I really appreciate it.

Brett Curry: Except for the part when I said you were the co-host of my podcast instead of yours.

Austin Brawner: Well, you know.

Brett Curry: All good.

Austin Brawner: You can talk. We can talk. We always have more room for podcasting, man.

Brett Curry: Let's do it, man. That was my way of subtly inviting you. Let's co-host this thing, man. Let's do it. I think one thing that'll be fun, because we were just talking about this prior to hitting record, you're a bit laid up right now, man. For those watching the video, they can't tell. You look spry. You look healthy. You got a nice beard going on, all good, but you're actually sporting a pretty serious injury. Talk about that.

Austin Brawner: Yeah. I was out playing some basketball with our mutual friend, Andrew Youderian. He was in town. We had dinner the night before.

Brett Curry:  Which I hear he's a baller. Now, Andrew and I hang out at a lot of events together. We've never played ball together, but I hear he can bring it.

Austin Brawner: That's why we were playing. We were at dinner and one of the guys was like, "Andrew's a baller. We should go out and play." I was, "Let's get a game together." I went out and drew out the court, started playing, and we were going back and forth. Sure enough, game one.

Brett Curry: You guys were playing one-on-one or was this-

Austin Brawner: No. It was two on two. First game, we just put the screws to him, and then the second game-

Brett Curry: You beat Youderian in the first game.

Austin Brawner: Yeah. I beat Youderian the first game.

Brett Curry: He never mentioned that to me. He never told me that part of the story. That makes sense.

Austin Brawner: The next thing we know my Achilles somehow pops. I don't know. There are allegations that he might have been behind it, but we don't know.

Brett Curry: He literally broke your ankle or in this case popped your Achilles tendon, which is a gnarly injury. I've never had one.

Austin Brawner: You got to watch out, because two, now Steve Chou another e-commerce podcast host took his out.

Brett Curry: Also a mutual friend.

Austin Brawner: You better check your Achilles. You got to be careful, man. They're going down.

Brett Curry: I got to be careful, man. I got too many kids to be carting around. I can't afford to pop the Achilles, so I'll try to be careful.

Austin Brawner: Actually, you got enough kids, they could be carrying you around.

Brett Curry: Dude, that's a good point. A couple of them are getting big enough to partially carry me. Others not so much. I got to put those kids to work, seriously. Man, really excited about the topic today when you floated this idea by me. Well, first of all, anytime you say you want to come on the podcast, I'm going to say yes. You floated this idea by me and I was like, okay, this is a brilliant topic.

Been hearing a lot of talk about this topic, too. Because, you and I both, we follow the industry like crazy and we look at, hey, what e-commerce companies are getting big exits or big IPOs. There's honestly not that many of them, and so we're going to dive into what separates e-commerce companies that scale from those that can't.

Why are you passionate about this topic? I'm just curious, Austin, before we dig into some of the KPIs and some of the issues here. Why is this important to you?

Austin Brawner: Well, I'm passionate about it because one of the things you said, that we don't see that many of them. We have a lot of growth within our industry, and for a long time we didn't see any exits. There's very, very few, and then they're starting to have some more come around. In the last year and a half, two years there's been more big exits. What interests me about it is that we've got companies that are growing very, very fast. Some of them go on to the exit or have an IPO. Then you've got other people who are in the same industry who think that they might have an opportunity to grow really, really fast and scale up and it doesn't happen.

I feel like both you and I are in somewhat of a unique position, because we've worked with a lot of different companies, and we had a good vantage point to see what's the difference. When I have a client come approach me and they're like, "I think we could make this thing big," sometimes I'm like, "I don't think so." Other things I'm like, "Yes, I can tell right away this thing is going to be huge."

Brett Curry: You have people coming to you to say, "Hey, I want to be the next Dollar Shave Club. I want to be the next Bonobos," or something like that. Sometimes that's possible, sometimes it's not.

I think we're going to dive into some of the numbers, some of the KPIs, some of the things that could be stacked against you, or working in your favor, depending. Let's dive right in.

From your perspective, what are some of the KPIs, key performance indicators for those that don't know the jargon, that separate the businesses that can scale from those that can't, or what are some of those telltale KPIs?

Austin Brawner: What I'm looking for right out of the bat, I think the environment has changed a lot over the last six years. You used to be able to build a business off of Facebook, Instagram, partly organic, partly paid.

Brett Curry: They're were cheap, man. Cheap, cheap, cheap traffic.

Austin Brawner: Very cheap. You could sell $20 sunglasses, and be able to do it profitably. We're first looking at product/market fit, if you have a product/market fit. The second thing I'm looking for is, is your average order value and lifetime value high enough that you can afford the relatively expensive cost per acquisition that you need to expect if you're going to be advertising on paid social.

When we talk about businesses that scale, one of the first things you have to ask is, is this product a candidate for demand generation, or is it a demand capture type product. If it's demand capture, you can get to a certain level, but if it's demand generation, that's where you can truly scale up.

Brett Curry: How do you differentiate the two? I immediately know what you're talking about, but demand capture versus demand generation, what's the difference?

Austin Brawner: Are people searching for your product already, or is it something that you need to put in front of them, for them to see it, recognize what it is, and be attracted to it?

A very simple explanation here would be auto parts, parts for your car. That is demand capture 100%. You're not going to go buy a muffler for a car, just because you see a Facebook ad for it, that you don't own.

On the flip side, some of these products that really grow quickly on Facebook often are products that are different versions of something that people already know and love.

A healthy version of something that people are already familiar with, that's a prime candidate for demand generation on Facebook, or paid social, because people might be familiar a little bit with it. They could see it, and be like, "Oh wow. Actually I didn't even know that existed. Now I want it."

Brett Curry: It's something like, and this example may cross over into both categories slightly, but I know you're friends with the guys that started MVMT Watches. That's one of those products that, yes, there are people, you definitely search for a watch when you need a watch, or you're buying a watch as a gift or something, and so MVMT can get you there. But then also it's a unique story and a unique price point and it's a cool look, and all these things, and so it lends itself well to demand generation also.

Actually, probably because it crosses over that's part of the reason why they should get a big buyout, right?

Austin Brawner: It is, from Movado.

Brett Curry: Movado. Yeah.

Austin Brawner: Because it's got a little bit of both.

Brett Curry: Yep. Totally agree. You mentioned auto parts. I love that example. That's the example I use a lot too for demand capture. Especially your run of the mill auto parts. Muffler is a perfect example. Brake parts. I'm not going to watch this clever catchy Facebook ad for brake parts and suddenly be inspired to go change mine. First of all, I don't change mine anyway, but an ad is not going to do that.

Now, kind of a nuance there is maybe car accessories could work. If this is something I'm adding on to make my truck or I actually drive a 4Runner, but make my 4Runner look unique, or cool, or whatever, that could be both in demand generation and demand capture.

So you're looking for you don't want just demand capture. You want something that can grow off of demand generation and ideally maybe some combination of both.

Austin Brawner: Exactly. Take a look at any Shark Tank episode, almost all the products they're going to have on there are going to be some version of demand generation products, something new that people can be exposed to for the first time and desire because they now understand why it exists.

Brett Curry: I love it, and this is something we talk about a lot, and you and I have talked about Google shopping some, it was one of the first things I did in the ecommerce space. Awesome traffic source. Love Google shopping. Doesn't scale. You'll reach a ceiling. You can make great money from it. It can be a good staple, core part of your advertising, but it does not scale. It's limited to search volume, and usually limited to very product-specific search volume. It's great, but it doesn't scale, so that's something to keep in mind.

Are there any factors you look for, and you kind of alluded to a couple of them where you said, hey, this is a product that's like something familiar, but better, different, more interesting, whatever. Are there certain elements you're looking for, for you to say, "Aha. This is going to kill it with demand generation?" Or are you just looking for track record, like it's already proven successful with small amounts of demand generation, so it's going to do well if we really push it?

Austin Brawner: No. I think that it comes down to doesn't necessarily need to have a track record. If it doesn't have a track record of something of growth, like quick growth, if somebody's coming, if somebody starts talking, like a business approaches me and they have gone from a million dollars to five million dollars in the last year, obviously there's something there. It's like, "Wow. They're already doing it." It doesn't necessarily need to be that.

The reason I use the example of something similar to something that people are familiar with is because, if people can understand it quickly, that tends to lead to the ability to grow very quickly, and if they want it. Potentially if there's a group, a large group of people that define some aspect of their identity around this product. That's so key in my mind.

This is why if you look at food, oftentimes you look at the different diets that are really popular right now, keto, paleo, vegan, they're all almost religions. 

Brett Curry: They are. They are. Yep. 

Austin Brawner: People are so tied into that. Because of that, if you have a product where people understand within that, it can tend to grow really, really quickly. Same with skincare, natural skincare. Those types of products can grow really quickly, because people have an identity about themselves, and they can relate it to a product that they're exploring.

Brett Curry: Interesting. Do you think that's a must for e-commerce companies that scale, that it has to tap into a pretty passionate community, and/or be something that people identify with, where they're proud to show it, to display it, to whatever, to say, "Hey, I'm part of this community. This at least partially defines who I am"? Are those necessary elements or just nice to have?

Austin Brawner: I don't know if they're necessary, but definitely a huge bonus if people are proud to share it off. I think that is a huge part of it, or it has to be a very hungry market. You look at, so Away travel. Away travel is really a company that's grown extremely fast. Why'd they grow? Well, they're trying to make luggage cool. Luggage is starting to look cool, but the key part of that is that people want to show off their luggage. That's a huge part of that.

Then you got on the other side, like Get Roman or something, ED, like erectile dysfunction medication. That's a hungry, hungry market. People aren't necessarily showing that off.

Brett Curry: You're not going to be talking about that, clearly.

Austin Brawner: No. For Hims, same thing. They've got a very hungry market, and they're coming at it in a different way. It just so happened there was just pent-up demand, and they were able to unlock this patent. The patent unlocked at a certain time and they were prime to jump in there. No, I don't think, it's not necessary, but that's one aspect of it.

Brett Curry: I think hungry market is necessary, but whether you show it off or not is not necessary, but it's nice to have, and great examples. I was thinking of so many puns as you were talking there. We're keeping this podcast clean, so I kept those to myself.

Austin Brawner: You don't want the explicit mark on your iTunes?

Brett Curry: Exactly. Exactly. Great, great examples. Let's talk a little bit about product/market fit. We've been alluding to that, so you're finding a hungry market, things like that. Anything else other than hungry market, a passionate market, like a keto market, or crossfit, or vegan? Other thoughts on product/market fit.

Austin Brawner: No. I think it's great if you can replace something that people are already frustrated with. That works really, really well, and those companies typically do well.

Then the next step is what is the founder willing to do right away, and what does the founder decide that they want to focus on? Because there's oftentimes a lot of these ideas, like everyone's got great ideas. What it takes from right off the bat is a founder who is relentless about getting it in front of an audience. They decide they're going to learn how to drive traffic one way or the other.

If it's demand generation, they need to learn paid social, or they needed to learn how to maximize sales on Amazon. Amazon's getting more like a demand capture type thing. They got to learn some way to drive traffic, and they can't let anything stop them, especially right off the bat.

Brett Curry: Because the roadblocks will be there without question. It's interesting, I was listening to Roland Frasier's podcast, Business Lunch, which is a great podcast, highly recommend it. He was interviewing a guy about investing, and how he invests. He talks about he invests much more in the people than he does in the idea. Obviously, the idea has to be great too, and there has to be a good product/market fit, but he invests in the people because of that very thing.

You got to be tenacious, and just want to get after it and figure out how to sell it no matter what. Because really hungry market and all those other factors only do so much. You got to be willing to push through and scrap to make it work.

Austin Brawner: There's probably going to be other competitors out there within your market. That doesn't matter. In fact, that actually is probably a benefit. If you see other people in your market already having success, that means that there's actually probably an opportunity for you. We've even mentioned Hims and Roman. Those are two companies that are growing incredibly fast in the exact same market at the exact same time.

Brett Curry: Both exploding. When you think about Viagra controlled that market for a long time, and now these guys are really growing as well, which is interesting.

Let's pivot a little bit. You mentioned something briefly a minute ago. We also were talking about it quite a bit before we hit record, and that's AOV and LTV, so average order value and lifetime value of the customer. Why is that important, and what are you looking for with those metrics?

Austin Brawner: It's important because if you want to drive traffic in 2019, it is expensive. It's getting more expensive.

Brett Curry: Without a doubt.

Austin Brawner: You're not going to be able to pay your way to grow if you have a low average order value product that doesn't have a high lifetime value. Even if you have high lifetime value, if your average order value is really low, you're going to be in the red for a long time.

Brett Curry: Cash flow issues.

Austin Brawner: You're going to need to raise a lot of money to be able to get in the game. You know this so well, because you're spending consistently with clients. You can have a client approach you and be like, "We really want to make this thing happen." They have an average order value of $17.99, and they're like, "We want to do Facebook ads."

It's like, well, it's going to be a little bit difficult, because you're going to need to be prepared to spend $40 to acquire a customer. That right there, even if you have a wonderful product, can make it a non-starter on some of these platforms that in the past you could actually grow and build a business off of.

Brett Curry: If you have that $17.99 AOV on Facebook, and I'm not a Facebook guy. You and Andrew know Facebook very well. You're going to run, what, remarketing mainly? The opportunity for cold traffic on Facebook at a $17 AOV is pretty limited.

Austin Brawner: Then it goes down to what type of a product is it. If it's one of those things, it's a wonderful, cool, amazing product with high margin at $17.99 but people just buy one of them, it's going to be hard. If they're buying them monthly, you maybe can make it work. Because you know that down the road they're going to be buying more. But, it makes it more difficult and you need to have more money.

If you have a higher average order value, because really especially right off the bat, if you're in the first inning. I say the first inning, like you haven't hit a couple of million dollars in sales yet, you're going to want to be doing that at a profit. Because it's only going to get more expensive. That's the cheapest it's ever going to get, is early on.

From there, you got to be acquiring customers at a profit, and then maybe later on once you scale and you've got a little bit of cash in the bank, you might be able to acquire them at a loss if you have a high lifetime value.

Brett Curry: There's a couple of points I want to make here. One, about some people start to hit a little bit of scale with Facebook early, or with YouTube, or with other channels and they think that that scale's going to be infinite at those returns, and it's not. I want to talk about that a little bit.

Then are there any specific numbers, so when you're looking at, and let's just talk CPA for a minute, so cost per acquisition, cost to get that new sale. Are there any kind of magic numbers you're typically looking for?

I did have some thoughts from my perspective looking at mainly Google and YouTube traffic. I can share that in a minute, but what are you looking at when it comes to CPA?

Austin Brawner: Well, I think that's a good question, and allow me to say it depends a little bit, because sometimes you can drop CPA quite low if you're running some sort of a sample pack type of a product. The CPA can drop really low, as long as you know because it's such an incredible offer, but you know you're going to be making all your money on the back end.

I would say the number that I'm really looking for is does your product sell for somewhere between $70 and $150, and do you have a healthy margin? If you do, and do people want it, if you're in that area, then you might be able to make it work, and to make it work at scale.

Brett Curry: I think the way to maybe flip that is, or maybe if your product doesn't sell for that, but you're replenishable and you can bank on those three orders in the next three months, since you're able to take a certain CPA.

For Google Ads, so search, shopping and YouTube, on the search and shopping side you can hit about whatever CPA you need to hit, or a lot of times people are looking at ROAS, return on ad spend. You could hit about whatever return you needed to hit on those channels, but the scale might not be there. If you needed to get, if you had a CPA goal of $5 or $10, you could sell some on Google shopping for that efficient. Couldn't on YouTube though.

If you're looking to scale on YouTube and run to cold traffic and really push that and blow that up, you can't scale with that CPA. For me, and I consult with companies all the time talking about YouTube ads and whether you're skincare or some kind of food-based, or supplement-based or whatever, or any other kind of e-commerce business, if you can live with really like a $50 CPA up to $100 CPA where that's what you're willing to pay for that first sale.

The AOV might not quite be there, but if you're comfortable with that CPA because you know your backend is so solid, then you can probably scale on YouTube. If you need to hit a $20 to $30 CPA on YouTube, you can get some business, but you probably can't scale. You can probably do just okay. Those numbers likely hold true on Facebook and across the board, would you say?

Austin Brawner: Yeah. I would agree with that. One thing I want to point out is that it's totally okay not to have scaled massively and run a business that doesn't scale. I feel like the most important thing is to go into it with your eyes open and know what you have. If you don't have a business that's going to scale up massively, don't try to go down that path and spend a lot of money in an area that's not going to work. Build a wonderful business, and then maybe take that and get it to a point where it's large enough, and then build another business, and add to a portfolio, and grow that way. Because you can have five of these businesses that aren't scaled up that are really healthy profits, and build an incredible life for yourself.

That's also one reason that I'm passionate about this is because I don't want to see ... I have worked with clients that think, "Oh, we got to scale this thing up." When, no, you don't actually. Just build a healthy business and build a portfolio of healthy businesses, and that's going to be an incredible way to scale yourself.

Brett Curry: Absolutely. Multiply that knowledge, build your own little private equity fund of brands, so to speak. Exit them as you want and sell them off. I think where people get into trouble is where they want their brand, their one brand to be a $100 million exit or something like that, or higher than that. That's not always possible. To your point, and I 100% agree, that's okay. That may not be what you should be pursuing, and it's totally cool, and you can still build something really awesome that isn't that kind of exit.

I think this is potentially a good time to transition just a little bit, and talk about line extension, and adding multiple products. We were just talking before we hit record about the 2PM newsletter, and what's the guy's name, Web Smith, is that right?

Austin Brawner: Web Smith. Yeah. I don't know what his-

Brett Curry: Is his real name Web? His real name can't be Web.

Austin Brawner: I don't think so. I think Web Smith sounds like John Smith for somebody who's on the internet.

Brett Curry: It does. Web Smith. My name is Internet Smith, really. The guy's brilliant though, just awesome, super-great to listen to, read. Check out the website.

He was talking about how single SKU, couple SKU ecommerce businesses don't really scale. You reach a ceiling, and then that goes back to what we were saying where you may think, "Hey, I'm hitting this $40 CPA on Facebook or YouTube. I can scale to infinity and beyond." Well, no.

One, you're going to exhaust those high-converting audiences and they're going to wear out. Then, you can only do so much with a few products.

All of the bigger e-commerce companies are diversifying, so they're either extending their line or going into new product areas, or, maybe to your point, maybe you're launching a separate brand altogether, if that makes sense. What's your take on line extension and going from a single SKU or couple of SKU to multi SKU? What does that look like?

Austin Brawner: Well, I think it's imperative if you want to continue to grow, and if you want to continue to compete. Because I've seen this many times, a company gets a really hot product, and they start throwing cash at advertising, and it's going like gangbusters. They're like, "Wow. This is never going to stop. We're going to grow, grow, grow, grow, grow." They build this business, and they completely forget about their next product.

At a certain point, the product that they have is no longer as cool as it was, or all the people who think it's really cool and are going to buy right away have already bought it. They're like, "What's next?"

If you don't continue to roll out ... I think that's the difference between a business owner and somebody who creates a cool product. A business owner thinks, "Wow." They think of it in a different way. They think of it not as a product-centric business, but a customer-centric business. We've got all these customers. We need to now deliver something else to them.

I think that's the difference. That is the difference. That's why a company like Away is moving ... They had these incredible hits right away of two, hit right away with their Away and Away. They have a hit with two suitcases, and now you go to their site and they're continually rolling out products, bigger suitcases, luggage tags, Dopp kits, weekenders, garment bags, because they know that they're going to have to fill, if they're going to dominate in this space, they're going to have to continue to provide things for the customers that they've already acquired at a hefty margin.

Same thing with a company like Tecovas boots. Tecovas boots come out the gate really hot. They are selling cowboy boots direct to consumer. People love them. What do they do? They double down and they focus on products, product lines. Because how many boots can anyone even have really? 

Brett Curry: I've got seven pair, but I'm unique. I like the cowboy boots.

Austin Brawner: No. It's a good point. Seven boots.

Brett Curry: It is a good point. I don't. Actually I'm totally kidding. I don't have any cowboy boots. What's really funny, and this is just a side note, I don't own cowboy boots but I live in Missouri. I live in the Midwest. Cowboy boots are a thing here. You live in Texas. Cowboy boots are a thing. Great western store in our city, one of the largest actually in the country, had a big tent sale. I went. I tried on some boots. I was this close to buying. I couldn't pull the trigger. Just felt unnatural.

But if I were a boot buyer, yeah, I'd buy seven maybe and then I'm done, but probably just buy a couple and then I'm done. They last forever, I hear.

Austin Brawner: They last for a long, long time, so what do you got to do? Well, you start with weekenders. Now, weekender bags, leather goods, jeans. What else?

Brett Curry: T-shirts. I want to celebrate ...

Austin Brawner: T-shirts.

Brett Curry: ... the fact that I wear, again, I want to be associated with this cool boot brand, so I'm wearing the t-shirt. I'm wearing the hat, things like that.

Austin Brawner: That's the difference between a company that scales up and ones that stall. It's that they're thinking bigger picture. They realize that all they're doing, this game is they were acquiring customers and now what else can we give them? We're not just a boot company. We're a steward of a customer. It's the Amazon thought process. We've got high-value customers. That's why Bezos started selling books. Who are the people that buy books? The affluent. He now has affluent customers, so what else can I sell them?

That's where you got to start thinking, and start thinking early, because it changes quick, as we know. You spend a lot of money, and you may exhaust this audience of early adopters, but you may grow a customer list of 20,000. Now what do you do?

Brett Curry: What do you do? I think that's the perfect way to describe it. A true entrepreneur, true business owner, they're thinking, "How do I delight this customer base? How do I grow this community and continually give them products that they fall in love with?" Versus someone who's just good at selling a product, and selling a product is great. You could make some money, but it's not sustainable. It's not necessarily a company that you can exit or build. It's just limited. It's limited.

Austin Brawner: You may let somebody on your team fall in love with the products, but if you own a business make sure you keep your eye on the ball and you realize don't fall in love with our products, because we need to fall in love with the customers, and make sure whatever they want we deliver.

Brett Curry: Because I think what you're tempted to do if you fall in love with the product, if things start to not go well for that product, you blame other things. You blame the market. You blame, "Oh, well, it's just we didn't have the right ad." Which could be the case, or, "Our market's not smart enough to see this is a good deal."

Yeah, or it could just be the product, and you need to not be married to it, and you need to try again. You need to pivot, and do something a little bit different. Great.

Any other tips on that or any secret sauce or things you see great founders, great companies doing that help them fall in love with the customer rather than just falling in love with the product?

Austin Brawner: Not necessarily within that space, but I do think something that's really interesting to think about is as companies grow, what I typically see is, I mentioned it earlier, that a founder gets really into some certain traffic source. They become an expert on that. They get really into it, whether it's Facebook, Google Ads, YouTube. Typically not YouTube, right, but sometimes. Whatever they decide to drive traffic at, they become an expert. They hit a ceiling, and then they get to a point where they're like, "Wow. I'm spending 80% of my day on this traffic source, and I've got a business to run. What am I doing?"

They realize they need help. That may be at two million dollars. That may be at five million dollars. At a certain point they say they need help, and they're smart enough. The companies that grow are the ones that are smart enough to say, the founder says, "I need help. I'm going to either take it to an agency, or hire somebody who can take over this." They move it off their plate.

Then they go explore another traffic source, and they figure it out. They keep that traffic source running, and they actually sometimes really can improve it, because they've got somebody who's now taking over and going full-time on this while they're doing other stuff. 

Brett Curry: I love that. Actually, we were talking about this before we started, that as an agency we like helping companies that have already gained some traction with their ads, and where we can come and just help them blow it up. What other reasons do you have though for why should a founder consider, "Hey, if you're launching into a new traffic source, you do it. You be the one to run that"? Why do you advise that?

Austin Brawner: Most importantly, because they need to know enough to be able to hire and fire people. If they don't know enough about that traffic source to fire somebody, they're putting the growth of their business into somebody else's hands, and that's not fair to the business. They don't want the responsibility of the business and they're putting their focus elsewhere.

This oftentimes happens with product-focused founders. They don't really want to be into marketing and traffic, so they try to go find partners to help them. But, you have to figure it out. You have to have somebody in the team who owns it and is obsessive about it. Because nobody's going to go to more lengths than you are to figure that out.

And, you're going to know the market better than your partners. That's why it's so nice to work with an agency once you've got traction. They can bring in their expertise from all the other companies they've worked with and bring a different point of view to something that's already working. But if you ask them to start from the beginning, it's probably going to not end up working out the way that you expect.

Brett Curry: Usually you're going to attract the agencies, a lot of the bigger agencies, the agencies that are in high demand. They typically are going to want to work on something that's starting from scratch, sometimes. You have the right combination of knowledge of your product and your industry, and all of those things, and time potentially to run it to make it worthwhile for you to do that. Absolutely. Good.

How else then should someone make that transition? They start with something. Once it's reaching a certain level of success, they bring on an agency. They hire someone to manage that, then they go find the next thing.

Austin Brawner: They find the next thing and they grow that next thing. Then at a certain point what's going to happen is they're going to have multiple traffic sources. It's now managing the agencies is going to start taking up 80% to 90% of their day. They're going to be like, "Oh my gosh. I got a business to run." Then they realize they got to hire somebody to be the director of marketing and CMO. That typically happens maybe $10 to $15 million business. That's just a range. It could happen earlier or not. I've seen that multiple times. People hit that level and they go out and they got to find somebody. Usually, that person, a good director of marketing especially in our space is in demand. They're hired.

Brett Curry: Without a doubt.

Austin Brawner: There's such high demand for that type of a role that it's hard to find that person. They got to go on the recruiting path, and they got to go around and they got to find that specific person. They got to bring somebody in and poach them from somewhere else. Oftentimes it works really well to go to an agency where somebody is underpaid and overworked, and has a lot of experience.

Brett Curry: Happens all the time. 

Austin Brawner: Bring him in. That's a place to bring somebody in in that role sometimes, or from another company as the director of marketing. At that point, the business is growing and continuing and now the CEO actually gets a chance to become a CEO. They're now focusing on getting the right people on board and that next level of growth is often alignment-focused, and getting the right butts in the right seats.

Also, maintaining focus on the fact that they're only as good as their next product line extension. Because at that scale, you have to start systematizing launches and continuing to bring out new products. That's the next step in this kind of scale up process.

Also, I think the people that really have so much power in these larger ecommerce organizations are the merchandise people. A lot of it comes back down to marketing, and they're like, "Oh, marketing isn't doing a good job." No, it's the product. You have to keep bringing out good products. It's very hard.

Brett Curry: For sure. This was where a CEO's naturally going to shift as they grow. In the beginning, you're doing everything. You're the head of marketing. You're the head of everything. You're cleaning up the office, all that stuff. Eventually, it really needs to come down to people and product, in my opinion. Where, as a CEO you should be all about how do I attract and keep and motivate the next talent.

Because that ties into product as well, because it's all about the product, whether you're running an agency like we are, or training and consulting like you guys are, or ecommerce business. It's all about the product, but really the people, if you have the right people they're going to be the ones continually improving and enhancing and iterating on that product or that service to make it better.

That's where you begin to hire a marketing director, or a COO, which is actually what freed me up in my agency over the last couple of years. We promoted an amazing COO, and it's allowed me to focus on the things that I love, and our business has grown tremendously because of that.

I think it ultimately comes down to those two things, is people and getting the best, and then product and making sure that you're obsessing about making your product better. That's the name of the game. Which is a perfect segue into what you're doing right now.

Talk about Brand Growth Experts and talk about the new relaunch you got going on right now. I'm pretty excited about it. Really it's designed to help people do what we've just been talking about, right?

Austin Brawner: Yeah. Exactly. I am launching something called The Coalition, the Ecommerce Coalition. For the last year, a little over a year I've been doing coaching for ecommerce business owners and marketers. We are opening back up the community. It's a one-on-one coaching community where people can work with me, and then every single month we have a very actionable training that is designed to help business owners know enough so that in whatever aspect of the business they need to they can be able to hire people, be able to fire people.

They know enough in that space whether it's Facebook ads, Google Ads, whether it's just even around hiring and managing a team, they're very actionable trainings to be able to help them get up to speed and continue to move forward.

We got a great community, about 120 members right now, and we're opening up. It's called the Coalition. You can go check out jointhecoalition.com, and it'll be open from June 18th to June 27th.

Brett Curry: Awesome. Man, I'm so excited about it. I know for me and my business some of the breakthroughs, the eyeopeners, the things that allowed me and the agency to scale and grow came from events and relationships with people like you, and Youderian. I'm part of Ezra Firestone's mastermind group, and hanging out with guys like Steve Chou and some of those in his group. It's like getting access to that, that's where you get ideas and breakthroughs. That's where you can bounce ideas off of people.

I was looking at this, I say I, myself and my business partner were looking at a merger recently, or an acquisition, rather, and kind of met with some people and they advised against it. It was super-valuable. Getting involved in this Coalition, the community is going to be super-valuable, because there's going to be other growth-minded e-commerce store owners that you can learn from. Also, they get access to you, which that's pretty rare with groups like this.

Austin Brawner: That is the unique part. I'm in there answering questions one-on-one for people every single day. There's a private thread, and it's been a big benefit for all the people I've been working with so far. One of the main reasons people stick around is just to get some help as you've got questions, as everyone does as they're growing their business, from somebody who's seen a lot of different businesses grow, and can help advise and make connections, and that sort of thing.

Because I have a very weird set of skills, as do you, where you're sitting and you're seeing hundreds of businesses grow in different ways, and you kind of pick up unique things along the way.

Brett Curry: You absolutely do. I was just thinking the other day of the dinner that you coordinated in San Diego a couple of years ago with just all of the amazing people that were around that table. It was the founders of MVMT Watches. It was Pura Vida, our buddy Chris Lynch from Everyday California.

Austin Brawner: Blenders.

Brett Curry: Yeah, Blenders Eyewear. It was BVACCEL, large Shopify agency. Looking at that, I mean and it was a cool group at the time, but now it's like everybody's having these amazing exit purchases and growth.

Austin Brawner: That's true. Those guys have exploded.

Brett Curry: I know. Those are the guys you get to hang out with and get to see, and so that gives you a really unique perspective. That's the perspective that shed light on this topic that we talked about today. I'm extremely excited about it. I couldn't endorse it highly enough, so check it out.

Austin Brawner: Brett has a training in there as well.

Brett Curry: It's true. I hear your Google Ads training that's in that is just blow-your-mind awesome. I did that training, which go check it out. What's that URL again?

Austin Brawner: It's jointhecoalition.com. You can go check it out.

Brett Curry: Jointhecoalition. Awesome. Check it out. Austin Brawner, ladies and gentlemen, bringing it today. Man, that was a ton of fun. Thanks for coming on.

Austin Brawner: Hey there. It's Austin again, and I have a quick message for you. If you enjoyed this podcast, I have something really exciting for you. For the last year and a half I've been coaching e-commerce business owners and marketers inside a group called the Coalition. You might have even heard me talking about it on this podcast. We have a lot of members who come on and actually share their story.

Now, what launched as an experiment has become a game-changer for our over 150 members. If you'd like me and my team of expert marketers and e-commerce operators to coach you on your journey to scale up your e-commerce business, this is your opportunity. You could head over to jointhecoalition.com to learn more. Again, head over to jointhecoalition.com to learn more. Everything we talk about on this podcast we go into way more depth with actionable training. You can get actually one-on-one help from me to help you grow your business. Hope to see you guys inside.

Austin Brawner: What's up everybody? Welcome to another episode of the Ecommerce Influence Podcast. My name is Austin Brawner, and I have a very special exciting episode for you guys today. I was interviewed a few months ago on a podcast by my good friend Brett Curry, and it was a great interview. I thought that he asked a bunch...

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