Overcoming Challenges in E-Commerce: Strategies for Success

Hi everyone. This is Ranmay back with your show E-Coffee with Experts. Today, we have Jonathan Snow, who is the founder and president of the Snow Agency with us. Welcome, Jonathan, to our show tonight.

Thank you for having me.

Great. I should rather say morning or afternoon because we have broad sunlight in your background rather.

Beautiful morning. Thanks for sharing.

Absolutely. Jonathan, before we move forward and talk about marketing, now it has evolved over the years with your experience there, could you please introduce yourself and your agency before we take it forward so that our audiences know more about Snow Agency and your journey thus far?

Absolutely. I’m Jonathan Snow, founder, and president of the Snow Agency. I’ve been in the e-commerce and digital marketing space for about a decade now. I got started on the influencer and affiliate side and ended up building an affiliate marketing platform with my brother, Dan, who’s been my partner on all business ventures since that point. So we essentially built the platform that got all the largest organic social media pages, Instagram, Facebook, Twitter, and millions of followers that we ended up getting on our platform. And then we ended up finding brands or businesses that wanted to run ads through those organic pages. We ended up driving nine figures in revenue through the platform in under two years of launching it. And then we ended up launching our own Shopify brand to leverage that affiliate network that we had built out. And we ended up scaling that brand up to seven figures in revenue profitably from day one. And then from there, we ended up building another brand and another brand. And we essentially ended up with an e-commerce holding company. And we were using the same blueprint that we used on the first brand, but for all the other brands that we ended up launching, close to 10 brands we had at our peak.

And we were using the same tech stack, the same traffic sources, and the same creative templates. Then we knew we were onto something special. And during this time of owning, operating, and launching all these brands, we ended up realizing that all of our strategies were translatable across e-commerce. We mastered the art of paid social performance creatively. How do we increase the conversion rate, average order value, and lifetime value of all these brands? And it was translatable and predictable to scale brands to eight figures and revenue profitably. And over about five years of owning this holding company of Shopify brands, we started getting demand for our services. And that’s how the agency was born. So the SNOW agency was founded off of that e-commerce holding company, and we essentially had our own agency that we assembled to just service our brands. But then we took on our first client, and then they referred a client, and they referred a client. Now we had as many clients as we did brands that we owned and had that moment of introspection where we had to choose, do we want to be on the brand side or the agency side?

And so we realized that what we loved doing was the growth, the problem-solving, and the marketing. So we ended up exiting our brands to focus on the agency about four years ago. And since that time, we’ve been a full-service agency. We’ve been recently acquired by Avenue Z with the vision of forming a next-generation media company. So we were pretty much focused on the SNOW agency, paid social, surge influencer marketing, creative production, and email SMS marketing. But we were lacking a strategy for CRO, SEO, and PR. So since the acquisition, we’ve been integrating with two other agencies that were also acquired by Avenue Z so that we could fully roll out robust capabilities that included PR, SEO, and CRO. So we’re a full-service agency now. We’re one of 12 Shop Clive Plus partners in the US for digital marketing, which has been a nice accolade for us. We have recently named the Inc 5000 the second fastest-growing company in the US in the advertising vertical. So we’re up to some exciting things here and happy to talk with you today about everything.

Absolutely. That is quite a journey and more to come, the way you have explained it. Exciting times are ahead for SNOW Agency and Avenue Z and the overall group company. You were into dentistry and then now you are this digital marketing geek and you have your agency. What has been the journey thus far? We would love to hear more from you.

Yeah, it’s a crazy story that could take up a whole podcast episode in itself. But, when I was a general dentist in the Air Force, I was stationed in Louisiana in the middle of nowhere and had nothing to do after the day ended. So in the air, of course, your day started at 7 AM, they end at 3 PM. This is before I was married. I was living alone in the middle of nowhere and my days were over at 3 PM but I had nothing to do. So that’s where I started getting my footing in digital marketing with my brother. So my brother, Dan, was launching all these huge organic social media pages. So @Rapp is his claim to fame, with over 10 million followers on Instagram. And so he brought that idea to me to build that platform. And that’s how I got started. And I was juggling dentistry and a digital marketing career for seven, or eight years. After I was a general dentist in the Air Force, I moved back to New Jersey, where I’m from, and I did a three-year residency program for orthodontics. During that time, we ended up launching all these brands.

We launched the agency while I was still in orthodontics residency. And then ironically, right when I was finishing up my residency, I was under contract to buy an orthodontic practice in the Bronx in New York City. And then COVID hit that week. So I pulled out of that deal. And during that time, we all know what happened to e-commerce and digital marketing. That was the biggest boom of all time. It was like Black Friday, Cyber Monday, every single day. So the agency started growing like wildfire. I just finished up my residency. Everything is shut down in New York City. I literally couldn’t even practice unless it was emergency treatment because orthodontics is all cosmetic treatment. You literally could not open your practice during this time. So that was my walking away point from orthodontics because the agency was growing so fast. We were doubling, tripling the team within one year since COVID hit. And I just couldn’t juggle both careers anymore. So still involved on the dentistry side, I’m an advisor for oral health, the venture capital fund. We have a nice niche of dental clients within the agency, too. So definitely still involved in dentistry, but on the business and marketing side, not so much on actually treating patients’ side.

You would be giving them advice, apart from digital marketing, marketing about how they should be going about with their patients as well at times, isn’t it?

Yeah, exactly.

Great. It’s a nice way to stay in touch, which you love at some point, and maybe now you never know. And then e-commerce has seen such tremendous growth in recent years, particularly, as you mentioned due to the pandemic. What are some of the emerging trends or best practices you recommend for companies looking to succeed in this competitive landscape that it is right now?

Yeah. It’s funny because things have changed so drastically over the past few years, especially with external courses like iOS 14, like macroeconomic shifts where the consumer became much weaker, and changes in the ad platform that reward more consolidated, almost objective automated media buying where a lot of the focus has to be outside of the platform. If you’re a performance marketer and you’re spending most of your day in the ad platform, you’re doing it wrong. So I think the biggest shift has been that we try to make a big impact on the creative on the landing pages, conversion rate, average order value, what text apps we need to implement, what email SMS retention strategies, and how we optimize LTV. All of our focus, 90% of our focus is there, everything in the ad platform is best left to machine learning and the algorithms. So that’s been the biggest shift we’ve seen.

Great. You did mention machine learning. So can you please discuss, or elaborate more on the role of machine learning in e-commerce? And at your agency, how are you leveraging this to drive better results for your clients?

Yeah, that’s a great question. The power of meta ads is from all the data, from all the machine learning. The biggest thing that was disrupted actually in iOS 14.5 was that anyone that opted out of tracking, that data feedback loop with hook converted, getting sent back to Meta, that was broken. So machine learning took a huge hit where there were a lot of false negatives. People were purchasing from ads because it wasn’t being tracked. The algorithm thought this person or this type of person is not likely to convert, even though they did convert. And it confused the algorithm and it threw the machine learning in disarray by adding all this noise into the system. So what we’ve been focusing on is how do we restore that feedback loop. And it’s not the answer. Everyone confuses attribution and machine learning and the data feedback loop. Attribution was impacted by iOS 14, but also the data feedback loop was disrupted. So if you use a third-party attribution system like Triple Whale or Northbeam, that’s great. If you want to improve your attribution and understanding of the numbers, that’s great to use.

But that doesn’t send that back to Meta. Meta doesn’t learn from that. So machine learning is still a big issue. And what we focused on in the past year to find a solution, we found a couple. There’s Popsicle and there’s Elevar, which used the Facebook Conversion API, which is different than the Shopify Facebook Conversion API integration, which has a lot of weaknesses. So if you’re only relying on that API, you realize all your events are getting sent back from the server, which is great. But after they get matched in Meta, if you’re using that Shopify integration, half of those events are getting thrown away because of privacy issues. But if you’re using Elevar or a Popsicle, you’re sending that first-party data back. You’re taking ownership of the data as a brand. When Meta receives that data, it’s able to use that data for machine learning to restore performance. That’s been our main focus in educating our clients that this is critical that they need to augment their marketing.

Yeah. Taking ownership of the data becomes so critical at times. In fact, at all times, I must say. That’s a very valid point raised there. Talking about common challenges in e-commerce, day to day life of an e-commerce business, small, big, whatever, things like abandonment, product returns, and not making that final purchase, putting in the card information, and going back. So what strategies do you adopt to counter these challenges for your clients?

Do you mean the abandoned cart and browse and abandon and everything like that?

Yeah.

The easy one is retargeting on paid social, paid search, and display ads as well. But email and SMS are critical… That’s going to be your highest ROI attempt to win customers that didn’t end up purchasing yet. Email and SMS, Klaviyo, and Attentive are the two popular ones. That’s what we love using for email and SMS. You got to set up all your proper flows for those browsing abandoned carts and hit your consumers at the part of the journey where they need to receive that message to be able to convert. Proper email SMS marketing should represent easily over 20 % of your store revenue. And it’s not just for retargeting those people that abandoned but reconverting people that already purchased. So for CPG brands, you need to be able to win them back for a second, third, or fourth purchase to elevate that lifetime value.

Yeah, absolutely. A lot of businesses or agencies working for their clients forget to tap in on the repeat consumption of your product or service. That is multiplying the revenue because that is lesser cost per acquisition on that. So a lot of people forget to tap into that segment which they have already earned for that matter. Talking about e-commerce and social media, the amalgam of how social media plays an important role for e-commerce and other platforms like TikTok, and Instagram. How do you leverage these platforms to drive more engagement and sales for your clients?

Yeah, it’s critical to have an organic strategy. I call an Instagram feed, a TikTok feed. That’s almost like a landing page for your brand. When we’re talking about performance marketing and brand messaging, brand voice, a landing page is designed for performance marketing. You want to increase the conversion rate when someone lands on that landing page from paid traffic, you want to convert them immediately. But the opportunity in that white space for your brand to get across the brand mission, the brand voice, the target demographic, that’s the best fit for the organic page. I see a lot of brands that focus on paid media because that’s sexy. That’s what drives the eyeball, that’s what drives ROI. Without a strategy on your organic page, I don’t think a lot of brands realize that consumers will click on your page before they go to your website and purchase. So if you’re not active on that organic page, if you’re not designing that grid to look harmonious and be on brand and not look like a kindergartener just through some random posts on the page, it’s going to improve your conversion rate if you have that robust strategy.

So it’s critical to think about social media on organic and paid fronts.

What is your take on Facebook ads overall, keeping the e-commerce industry in perspective?

Yeah. So Facebook is king. Facebook and Google, are the kings of digital marketing right now for e-commerce brands. Tiktok was the shiny new object of 2022 when the economy took a downturn and iOS 14 was impacting the industry. Everyone ran TikTok as this savior. Oh, maybe everything is where TikTok is and we need to be on TikTok. Let me pull budgets from Meta, and go to TikTok. I think those brands realized that… Don’t get me wrong, TikTok is a viable platform, but I think those brands realized that Meta is king. My opinion is that Meta will always be king while I’m in this industry for the next 20-plus years. I don’t foresee a platform that can even come close to Meta. Not even close in terms of scaling, maintaining scale, and achieving performance. Meta has a discovery and a conversion element to that platform where you hit them with the first touch and last touch all in that same session to drive in both purchases. I don’t foresee any platform being able to do that like Meta.

And then you did mention brand voice and the positioning of your brand and how people perceive it. There is always a gap in terms of how business owners feel about their brand versus how the market perceives it. And as agencies, it’s a very important responsibility to bridge that gap. And so how do you feel? What are the important pointers that an agency owner should look at while having these discovery sessions with a business that is getting on board and driving home that message, that brand voice, that value proposition, or positioning of the brand on the market with the information on the market, the positioning that they want in the market? So how do you bridge that gap?

For every brand that comes on board with our agency, we do discovery to first understand what are their business objectives. And because we’re a performance marketing agency, every brand cares about ROI. They come to us to make more money and scale profitably. So the brands that are protective of their brand voice and brand messaging expect a high ROI. They’re almost at odds very frequently. So we try to find a happy medium where we’re like, okay, give us your brand kit. We understand your type fonts, we understand your brand colors, and we’re going to make sure we use all of that in the creative, but we need to get you a little out of your comfort zone, use a lot more user-generated content, speak to the pain points that consumers care about. I think the major issue that I see with brands is that brands have an ego. They think that everyone cares about them and their brand. When consumers hear about your products for the first time and they’ve never heard about you, they don’t care about your brand. They care about themselves and the pain points that they are dealt with daily.

So if they see an ad in the feed and they see, let’s just talk about a gut health brand. One of the brands that we own is a gut health brand. Let’s talk about bloating. We run an ad for Cholera as the name of the brand. A new consumer sees Cholera and they’ll scroll right past it. They don’t care about Cholera. They’re like, Oh, what’s Cholera? It’s just an ad. I’m going to go buy it. But if they see an ad that talks about bloating, brain fog, indigestion, or weight gain, now they might stop and want to hear more about it because they resonate with those pain points. So that’s what we’re trying to educate our brands on selling indirectly. It’s selling what the consumer wants to see, which is all selfish needs, not selling the brand to the consumer.

Yeah, it’s more feature sell, benefit sell. So you need to plug in that way versus just talking about your brand, what it does, how it does, how it’s going to work, and all that. Correct. Before we wrap it up, Jonathan, I need to ask you about this burning topic of AI, ChatGPT. You have been in the industry for more than a decade now. Have seen it all, have gone through merger acquisitions, and seen it all in this span. How do you think AI is going to evolve the industry in another, let’s say, 5, 10 years? How do you see it moving forward, especially with people getting scared for their jobs and all of that?

Yeah, that’s a great question. It’s the million-dollar question hot topic today. Currently, we’re using chat GPT and AI really for market research primarily. So competitive research pain points, if we’re like, Give me five consumer pain points, why someone would want to buy that digestion product? So we’re using it as a nice starting point for all of our creative inspo, our marketing angles, and everything like that. Even inspo for email copy, and headlines for an ad. You can ask it, Give me five compelling direct-response headlines about why someone would want to buy this product. And it gives you some great inspo that you otherwise wouldn’t have possibly come up with, or it might have taken you an hour and wasted your time to come up with. So how we view AI is that it’s not going to be replacing humans. It’s giving humans a tool that they can use to be more effective in their day to day and potentially increase their bandwidth and increase their operational efficiency. So it’s almost like humans with calculators are a tool so you can save time from doing long formats. It made humans more efficient and impactful. How I see AI going and what I’m most excited about is automating media buying. So budget optimization. If a brand can just plug in what their KPIs are, and what their defined budget would be based on those scaling parameters, having the machines operate that so that the humans can focus on the subjective elements of marketing, creative strategy, offer to test, things like that. So that’s one area that I’m excited about. But also I think AI and creative and just spitting out a ton of different formats of UGC, one raw piece of UGC and giving eight different hooks, text on screen, and then just iteration on the data based on the results from that. So it can iterate the things that have already been working and give you more creative tests on top of that. So that’s what I’m excited to see in the next phase of AI.

Super. Jonathan, while it has been insightful in terms of what you have shared, I am pretty sure that our audiences would have benefited a lot from hearing from you and understanding your journey this far, and also your opinion or insights about the digital marketing subjects that we discussed tonight. And before we wrap it up, Jonathan, I would like to play a quick rapid-fire with you. I hope you’re game for it.

Absolutely.

You look like you’re always game for that piece. What is your favorite book?

My favorite book? That’s a good one. Honestly, it has nothing to do with digital marketing. The little book on common sense investing had a big impact on me when I first started generating money. There’s nothing more important than knowing how to save and invest your money and let your money work for you. So understanding the power of index, compounding gains, compounding interest and dividends over time, especially doing it while you’re young, really educated me early on to be able to build a nice investment portfolio that scales over time.

Great. And are you a morning person or a night person?

A morning person. I’m up pretty early every day. At 6 AM, I go to the gym. I try to keep physical fitness a priority. So then I set the day right. I have energy so that when I walk into the office, I’m already wide awake, I’m wired, I’m ready to go.

Yeah, absolutely. You can say it from your physique out there with your bicep sculping out, you are a morning person. Great. What was your last Google search?

My last Google search was probably around the news… My last Google search was around branded content ad formats on Meta, which is a new priority for Meta. So I’m trying to carve out how to leverage that with PR, especially. Branded content is when you have something published on a publisher’s website and now the brand can run that ad with the publisher. So it’s almost like a level of whitelisting that hadn’t been tapped yet. But I know it’s a big focus in a meta moving forward.

Great. And let’s say if there is ever a movie made on you, what genre would it be?

What genre would it be? That’s a good question

What do you think more rather than asking those digital marketing questions?

No, that’s a good question. I would say it’s, I don’t know, like the day-to-day grind of John Snow, the real-life John Snow. I’ve been pretty deep into many different industries like dentistry. I think my story in general, is just like a day in life. I understand business deeply. I understand medicine and dentistry very deeply. I understand digital marketing, and I’m a massive sports fan. So I probably know more about NFL and fantasy football than 99 % of the people out there that are doing it for a full-time career. But I never appreciated having free time. I need to keep my mind busy. I’m not the one just on a couch watching TV. So I use that time to just dig deeper into areas that I’m interested in.

That’s nice. And you did mention sports. So what is your favorite sport?

American football is my favorite sport by far to watch. I’m a huge New York Giants fan, but I love basketball as well. I’m a big Knicks fan. The Knicks are in the playoffs now, deeper than they’ve been in the past 10 years. I’m pretty excited.

Great. One last question. The thing Hello.

Sorry, you cut out there. I didn’t hear anything you said.

Yeah, sorry, I’ll repeat the question. So the thing that you like the most about your work office? We can go back as well if you want to.

What I like most about this industry is that it’s constantly evolving. It always keeps you on your toes. That’s actually what I like the most about this work is that it doesn’t feel like work to me. It feels more like a hobby because this industry, this environment started as a hobby because dentistry was my main career. So it always felt like fun to me to stay on top of everything, to understand, connect the dots. I enjoy that the book has not been written on e-commerce with digital marketing. That’s what we’re doing right now. We are writing a book on what e-commerce is. E-commerce is less than 20 % of overall retail sales. We’re very early here, and that excites me that we can write the textbooks of what this future will become.

Yeah, should have expected this answer given your appetite for learning. Great.

Absolutely.

Jonathan, thank you so much for taking the time for this podcast. Appreciate you sharing your insights and a big thank you for doing this.

Of course, my pleasure. Anyone who wants to follow me for more insights on Twitter @dr. Jonathan Snow. I try to post as much knowledge and insights as I can on a daily basis so that everyone in the industry can glean from the perspective that I have with a ton of different e-commerce brands in our agency’s purview. Give me a follow and we’ll connect.

Super. I’m sure you’re going to get a lot more after this. Super.

Thank you, Jonathan. Awesome. All right, thanks, everybody. We’ll talk soon. Yeah.