We are back this week with a truly awesome episode of eCommerce in the Trenches, featuring Scott Desgrosseilliers from Wicked Reports. The “Data Wizard” as JD calls him recounts the story of discovering his aptitude for reporting and data analysis and how that skill led him to create a company that helps you “grow your business with game-changing market intelligence.”

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Scott: I woke up at 5:00 am and I was like I got it, I have it. It just came to me, I don’t know if I even slept.

Announcer: The biggest names in eCommerce share tricks of the trade from tools and software, to strategies and growth hacks. Learn from the best and take your business to the next level.

JD: What are the actual tactical things that you are doing to attract people?

Announcer: Now your host, JD Crouse.

JD: Welcome back to eCommerce In The Trenches. Today I need to ask for your forgiveness. The show today is my interview, my conversation with Scott Desgrosseilliers of Wicked Reports. We were having some audio difficulties. We decided not to record this interview because the quality of the content was phenomenal. Scott, you are gonna love him. He’s a data wizard. I would just like to ask at the outset if you would grant us a little bit of grace while listening to this podcast. By all means, let us know what you think. Thank you so much. Enjoy the show.
Hello and welcome back to eCommerce In The Trenches, this is JD Crouse. And today I’m super excited to have the data wizard Scott Desgrosseilliers on the call with Wicked Reports. Welcome to the podcast Scott.

Scott: Thanks JD. And that was impeccable pronunciation.

JD: Thank you. I was wanting to nail that man. I was really striving to hit that well.

Scott: You nailed it.

JD: For those of you who might not know Scott, again he owns Wicked Reports. In thinking how to introduce you man. It’s obvious to me that you have a gift for being able to take large amounts of data and move it around and sort it and split it and whatever you do, and present it in a way that dumb business guys like me can look at it and take action on it. We’ve got a bunch of questions we want to get into. If it’s cool with you I’m gonna call you the data wizard, is that all right?

Scott: Let’s try it out, see what happens. Actually I live up to it now.

JD: Wonderful. Why don’t you with your own words just tell us, tell our listeners a little bit about your background and then we’ll dive right into some questions.

Scott: I’ve always been able to … I’ve always had a lot of faults. I can’t tell colors. I can’t use tools. I have other things my wife will let you know. She loves but I exasperate her on a daily basis. I just backed into, I’ve got an escalade and I just backed into a fire hydrant and cracked it, and we only had it for a month. Like a lot of things I’m not good at. However, I’ve always had a knack for data modeling and being able to piece together data from a real business situation. When I was 11 I had a Commodore 64 and my mother is like, I have to print out all my Christmas kids. And I was like there is thing called a database and I just kind of flipped through a manual and then whipped it off and all their Christmas cards would print out every day or their address labels and she was all excited.
She was like, “What can you do with my recipes?” I whipped together a database for that. It was something I could do immediately upon reading what to do. I merely understood it just like … I was naturally wired to do it. As I went through my life looking back where I’m at now, any situation, be it fantasy baseball or football where there was an auction and you had to calculate price. Or Motorola my first mob, if they had a massive spreadsheet of 60,000 … It was crashing Excel, all the different people worked on at Motorola and so they brought me in for database. I could scan the Excel sheet and immediately see how I was gonna wire it together, whereas normally a project like that you spend a couple of weeks trying to get the data model right. For me, I’d always have a couple of weeks headstart in these projects, because as soon as I looked at it, almost as fast as I could sketch it out, I knew how it was gonna all speak to each other.

JD: That’s amazing. I watched the movie with Ben Affleck, the accountant. Have you seen it?

Scott: I love that movie.

JD: I pictured you in the boardroom with your sharpie writing on the boardroom windows all of these numbers like you are just seeing it. Numbers are just telling you a story and they all belong somewhere. Is that kind of somewhat what it’s like in your brain?

Scott: I remember when I first had tied together AdWords, Facebook and email data and CRM data. I had actually gone out drinking, I had a couple of Moscow mules, I went to bed at 1:30 in the morning. I woke up at 5:00 am and walked to the computer and just spit out the sequel. I called that holygrail.sql. I remember it like yesterday. My wife is like what are you doing? She was probably like, what is he hiding, why is he on the computer, at 5:00 am? She got up and I was like, I got it, I have it. It just came to me. I don’t know if I even slept that night.

JD: Was that for Motorola or was that the backbone for?

Scott: This was the backbone of Wicked Reports. I had some other smaller iterations from a friend of mine. I guess I’ll tell you briefly how it got started, a friend of my Mark from getmainelobster.com, he runs an eCommerce business live and frozen lobsters online. It’s pretty complex to literally pluck them from the water, put them in a tank, and then someone buys them and you just plop them in dry ice and send them live across the country. It’s kind of barbaric but it’s also kind of interesting. When was like, this is 2014, he’s like, Facebook is terrible for lobster. I say, “Why is that?” He said, “I spent four grand. I got ton of traffic but I only got one sale.”
I’m thinking I’m surprised you got a sale, no one’s ever heard of you. You’ve got some random brand saying, “Hey, come spend 200 bucks.” Who’s gonna do that? You found one person.” He’s like, “How am I gonna tell?” I was like, “There’s gotta be something out there.” I looked around and there really wasn’t anything out there at the time, particularly not for a commerce business, he was doing like maybe 2,000,000 at the time, 1,000,000. There was enterprise solutions if you are like half a billion, but there is nothing for the one to $50,000,000 people that are spending five grand up on Facebook.
I was like I could figure this out now. I cooked something up and what we found out from his promotions at the time, which was pretty cool was that women 40 and older that liked the Red Sox or The Patriots but don’t live in new England spend 12 to one … They spent 12 bucks for every buck [inaudible 00:07:14] to get. He just lost his mind. He was so excited. Then I presented it too an Infusionsoft Mastermind, I showed a guy there that I know and he said, “Hey, I want to present that.” People just flipped out. I was getting five to 10K a pop to do pivot tables for this. And then I was like, “I think I got a business here I should probably create a legit database for this. That’s kind of how it all got rolling.

JD: That’s amazing. After the five to 10K a pop for pivot tables, you drank the Moscow mule which then allowed for the inspiration for the backbone of Wicked Reports. Is that the chronology of it?

Scott: The inspirational Moscow mule, yeah. And then I was like, then I was working with just five or 10 people that had found me almost day to day, because they were like so excited for the data. Then there was all kinds of quirks, and we were using duct tape, me and another guy who is still with me, just duct taped the thing together at the time, because then the demand was like … I didn’t even advertise it, my call to action was my personal Gmail, and people were finding me.
ICON was coming up, the Infusionsoft event. We integrate with all kinds of things now but at the time it was like April 2015. I was going over all these different domains like data for money, turn into data into money is one of mine, I was obsessed with that. I was like, this just doesn’t sound cool though. It sounds boring. Then I was like, “I want these things to be awesome.” Up at new England if something is great it’s wicked, it’s not very wicked. Try this lobster roll, it’s wicked good. Have you seen that band? They are wicked awesome.
I was like … They got to be wicked cool. I was like, you know what? Wicked Reports, let’s just do it. That’s where I went. I bought the domain like April of 2015. Printed some t-shirts, went to icon, went up to Ryan Deiss a Digital Marketer and I’m like, “Hey Ryan, can you tell which emails … You guys send a lot of email, how do you know which one brought the sale in?” He goes, “We don’t know.” I go, “I can tell you that.” He goes, “That would be awesome.” Next thing I know Digital Marketer were my 10th customer and they are still with us today. They are one of the bigger ones I’d say [inaudible 00:09:25].

JD: That’s amazing. That’s so cool. Let’s get into trenches. eCommerce In The Trenches exists to help business owners attract, convert and retain great customers. Having you on today is an excellent fit and what … If you had to summarize the problem that Wicked Reports solves, what would that be?

Scott: That leads can take time to buy and when they do buy, existing platforms that you advertised on can’t tell you where you found the customer. The longer they take the harder it is to tell and the less likely they are going to be able to give you the right information because they are not built do to do that. We solve that, particularly if you are using Facebook ads or google AdWords to get leads, and then you are closing them on email, which is probably what’s happening, then that’s what we solve. Then we give the ROI back so you can make intelligent decisions on how to scale your ads spend. Because everyone gets success in eCommerce somewhere, then they start trying to scale, then they are not scaling and they blame it on Facebook or the pixel or whatever.
It usually comes down the customer journey and not understanding what worked at a particular point in the customer’s mind, and that’s what we try to help people with.

JD: Let me try to summarize that. Wicked Reports solves the problem of finding where, what caused somebody to convert, and the journey that they took to get to that conversion and mining it all the way back through the various touchpoints and channels and media by which you communicated with that customer, is that accurate?

Scott: That’s accurate. Not call bad. You called yourself … The only thing I didn’t like about the intro is when you said the dumb business guy. I’m like, like, “I know that’s not true JD. You just clarified my own freaking thing I work on all the time better than I did.”

JD: Here I am a business guy and occasionally I’m smart, but most of the times I’m just stumbling through and occasionally I get to brush up against really smart guys like you and hire you. One of the challenges that we have faced is everybody that you spend money with is trying to take credit for the sale. The more evolved, the more ubiquitous eCommerce is, and it’s not going backwards. I don’t think so. eCommerce is just more prevalent, more part of every day life. The more I believe that it is a 360 degree, it’s kind of like a rising tile floats all boats. How do you think about attribution which is what we are talking about here when depending upon the price point and a lot of factors basically the time period, the timeframe it takes somebody to make a purchase decision. How do you think about all of the different touch points that actually causes somebody to pull out their credit card and order something online?

Scott: I think about this all the time because we all it the customer journey but then other people corrupt that phrase and use it for all sorts of different things. At the end of the day you want to have a profit machine. You want to be able to reverse engineer, where did I find my highest value customers at a profitable spread? That’s what attribution seeks to do. For me, when I look at all the different interactions people have with the brand it’s mind-blowing. They’ll go through and search their Gmail and see if a coupon link still works or an expiring offer.
They’ll go in and re-opt into your site to try and get the newcomer discount. They are crafty but they are also illogical. They’ll click on an email and then just re-opt into something that they clicked on. They are not always these savvy internet people that are gonna follow the funnel you mapped out, they do all sorts of crazy things, or your targeting isn’t set up right. You are showing cold traffic ads, that people run your list for a year and then if they react to that you think you got something for cold traffic but really they’ve been on your list all the time.
For me with attribution it’s like how do you distill all these chaos into actionable things that provide the biggest bang for your time? When I looked at it, which I look at all the time but we got all these points, it’s gonna just explode your head if we try to calculate the value of all the points. Furthermore, it’s gonna do you a disservice. You are gonna be mining through all this data, why are you in the data? You are in the data, you want to get out of there. You just want to take the action, make money and move on. I like to stay in the data but most people don’t.
What I came up with was that, and this is where I get some patents behind this is the concept of first opt in which is all out of all the things you are doing what deserves credit for the very first time someone opted into your list? Because that’s a big commitment to say, “You know what?” I’m gonna let this person. I don’t know them, I’m willing to give them my email and I hope they don’t annoy me. I hope they can be deals. For me, I hate opting into things. Absolutely I’ll tell friends of mine in a lot of markets, I’m sorry, I’m opting out. I still love you. I don’t like getting email, I get enough. I already get enough. I don’t want anymore. It’s a big commitment.
For me that first opt in point is huge, because it’s saying someone was a cold prospect and now they’ve become a warmer lead. That’s critical because when you want to scale your business, which everyone does, you’ve got to find more cold leads that end up becoming high value customers. That point is critical, but it’s critical that you measure it right, that you don’t give something over-credit and then you base it on real orders that happen over time and update that value of that ad as time marches on. That’s what our number one specialty is because it’s so important. It’s like if you get someone that you look at the end of the year and you are like, someone just spent 100 bucks a month with me for a year, they went 1,200 bucks. Where the hell did I find them?
You first found them when they were sifting around and they decided to hand over their email address either through an order or through just opting in for a coupon or whatever type of deal you are running for marketing. You’ve got to up the value of that point as those leads are worth more money because suddenly, because when you run the ad, like when Mark with Get Maine Lobster, his leads take three, four weeks to buy. He hates it. He’s always trying to get them to buy quicker. They don’t. He has to be able to say, now that they are buying, he generally is not gonna run a campaign in the red for a month. He just can’t have the stomach for it. When they start buying that’s like, where did I find them?
Granularly like what was I targeting, what did I show them? Because now I’ve got hopefully a crowd of people that has 1,200 bucks a year with me. I can go find more of them that way because I know where I found them and how much spread I made on them.

JD: That’s good stuff. You are telling me that your technology Wicked Reports will map that customer journey like, how much detail Scott am I able to see when I kind of get behind the curtain and I start looking at my conversions? Do I see at the specific customer level or do you bundle them into the top 20%, an 80-20?

Scott: We do both.

JD: You do both.

Scott: We do both. On anything we are reporting we show every inbound session starting click for that lead that we’ve ever captured. If you click on a revenue or sale amount, we show the actual Shopify order IDs, so you know where our numbers came from. If we show leads we pop up their contact ID from Unific or MailChimp, or Active Campaign, Klaviyo, [inaudible 00:17:56], whatever. We are always believing transparency of the data because you don’t have transparency on your ad platforms and you try to scale it because Facebook shows a ton of conversions, Facebook is taking credit for every ad that anyone ever viewed in the past 30 days.
Furthermore, if the lead came more than 30 days ago from a different ad, then converted on the retargeting ad, you need to know both. I found the lead from ad number one, 30 days ago and then I closed them on ad number two, which was the retargeting. We break it down, we do five different points. First click is the first thing we ever tracked, first opt in which I just touched on, re-opt in, which is when they opt in, we see an email submitted and they were already on your list. We go check against Unific or MailChimp or whatever and say when was this lead created?
Let’s make sure they weren’t already on your list, because they react totally different. If I already a brand and I see a Facebook ad, I’m much more likely to click and buy, then if it’s something random. Facebook doesn’t differentiate that and then again you say I got all these conversions, how come I can’t scale? Maybe they were all people already on your list that you got to take to try to filter those out but people don’t, and then they start reacting to a Facebook conversion based on an assumption that isn’t there.
Then of course we use last click which is what converted people, which is often email, and then Facebook or something else will take credit even though the email like abandoned cart, an abandoned cart email closes someone or you had showed them a retargeting ad four days ago, and the retargeting ad goes, look we sold someone. That’s not true. We’ve got to be like honesty traffic cop with all your marketing.

JD: The five things, first click, first opt in, re-opt in, last click, and then what’s the fifth thing?

Scott: The fifth one is full impact ROI, because some people just want to say, all this journey sounds great but I just want to make sure, am I making any money or not? We look at all four points without double counting an order to see did this campaign ad set or ad, or AdWord, whatever you are doing, did it contribute in one of those four points? If so, it’s a full impact ROI. We know that it worked somewhere in the journey. It’s just like, tell me that it worked. It’s kind of like an intelligent aggregate of the other points.

JD: When you are working with clients, obviously they have to leave their Facebook pixel on their site in order to run traffic because Facebook is measuring conversions in order to get you cheaper traffic. They are measuring outcomes, even if it’s just impressions, whatever the goal is, you’ve got to be running enough, you’ve got be able to hit enough of those goals to drive your prices down in theory. When you have a client that is fully onboard with Wicked Reports, are they almost blind to what is going on over there or do they just look at it with a grain of salt, but really look at Wicked Reports as their guiding light?

Scott: You need to use as the source of truth because we are showing you these are the clicks, and the closest one to this particular journey points was getting credit. You still need the pixel, that’s still helpful particularly if you have a multi-step funnel and you want to just track how well is this registrations working? That’s helpful for that? Plus, Facebook needs data. Generally, that’s the initial hurdle, it’s interesting. People come to us because they are like, “I’m trying to scale my ad spend. I can’t do it with my Facebook numbers.”
Then they get in there and they are like, “My Facebook numbers are different from my Wicked Reports numbers.” We are like, “Yeah, that’s why you bought us.” If we are just parroting back the same stuff … If I would have done that, that would have done that that would be a much easier life. I know that.” That’s the number one thing. They don’t match. I’m like, “That’s why we exist is that they don’t match. That’s the point.” There is some education that happens with some people that pretty much determines how the relationship with us is gonna go. If they are jazzed about that, it goes great. If they can’t get their brains around it then they are gonna churn. That’s pretty binary.

JD: We’ve used UTM tracking obviously in our Facebook ads and in our email campaigns and things. Does your technology, does it work similar to that or are you kind of more like pixels? How do you actually track all of that?

Scott: We have auto-updated. When you authorize your Facebook account with us, we will ping your account every six hours and do, we’ll put a wicked ID. Instead of you having to have a complex naming structure that you keep in mind or that you try to append we are gonna have an ID, and we can look up the exact names in Facebook of your ad set ad and campaign and then reflect those in our reports. I have naming conventions that I suggest to people which sometimes are followed and sometimes aren’t, but whatever naming convention you happen to like in your ad sets or ads in campaigns we’ll just report that exact thing in the data so there is no translation you have to do.
My original solution had UTMs and then Digital Marketer being the 10th customer was like, “This is great, but we got a problem. We’ve got 400 ads. We are not doing 400 unique UTMs. You are on drugs if you think we are gonna do that.” I’m like, “This is our first big wheeler customer and they are gonna cancel. We need to figure something out.” The obstacle is always the way man. It’s always the way. I cooked up something and it stuck and worked. Now we auto-update and it just keeps data accuracy and then you don’t have to worry about naming schemes. We’ll auto-create UTMs for you based on your names if you’d like. If you don’t then we won’t.

JD: I’m not very techy, so that’s gonna be probably the farthest down that rabbit hole I’m gonna go. But it makes sense. It makes sense what you are doing. The business guy in me, I want to hear about the wins. I know that you have your buddy Mark with getmainelobster.com. Are there some … Some of the most amazing stories, maybe you can’t share the actual brands, but do you have some real gems that your clients have been able to use the information that Wicked Reports serves up and take action on it and scale or get a 50:1 ROI?

Scott: Yeah, I got two that you just triggered. That’s good. I’ll just say it’s an online music person. They turned off an ad set because they ran it, I think they spent like somewhere between 16 or 100 bucks and got no sales, so they stopped running it. Lo and behold it actually ended … That happens a lot, because you look at cost per click and what you are spending. Let’s say you spend 100 bucks, and your normal cost per click is 50 cents and to say, wait a minute, I’m spending $3 a click here, I blew 100 bucks and I got some leads and none of them bought, why am I targeting these people? I’m done.
They turned it off. Then they revisit Wicked Reports in a couple of months and they made 12 grand. It was really like the most ideal leads on earth for whatever kind of, I don’t even, whatever their hierarchy ascension of products. There wasn’t 85 customers, it was just like five or six that all went for the high ticket item. The ROI was I think they did a case like we are doing case studies for … We are Facebook marketing partners. We did some case studies. It was like 17,000% ROI on 80 bucks or something. I was like, that doesn’t happen every day. They were like, no, we turned it off. That happens because sometimes cheap leads are cheap because they are cheap. They are on Facebook jerking around all day instead of making money.

JD: That’s exactly right.

Scott: That’s not always the case but the costs are going up and we pull in the Facebook. We are working pulling in the alerts where they show, sometimes they are recommending $20 to $50 to pay for, maybe for your final party of funnel. If you get your math right you can pay 20 to 50 bucks. If you know, these people are worth $700, I can pay 50 bucks a conversion. I’m gonna make 650 bucks. The inventory is fished out now, now the price is just gonna keep rising. The mass is gonna become more important. That was a good one.
What was the other one? The other one was like, we were banging our heads trying to figure out why the Facebook stopped working and came to find out we had started sending the leads to a new email campaign that we downloaded for some guru and our implementation of it sucked. They thought Facebook is not working anymore, you got to look at what you are doing with those leads. It might be the leads are great and you are just sending them crappy emails. That happens a lot. That’s one of our common things.
Hey, you saved us a ton of money because we … Here is another one, let me think of the name of that business, one I can share from you. What was it? This guy was online, something to do with bicycles. Bicycle training or something. He would do online sales of bike stuff, bike parts, bike lessons, bikes this and that. He’s like man, “You guys saved us a ton of money.” I was like, “Awesome. Why?” He was like, “We’ll found out, when we looked at the email sequence, we sent the welcome email. And then you have some big warmup and then you’re gonna close them with this Jedi sales tactic on email four.” They are like, “No one ever reached email four. Everyone bailed on the second email.”
We show that with email clicks, because to me … They upped their ROI 400% on their email campaign, because they just got rid of email number two which everyone hated. That happens a fair amount. Do you know when you send an email and you are like, maybe people reply back. I love that, it’s awesome, but who’s clicking and who is buying? It is much more important than who gives your ego gratification on email?
Another one was, this is Mark’s because it’s just so vivid in mind. He sent out an email about his birthday and he sells lobsters online. Sends an email out, “Hey, it’s my birthday. Want to play a game?” It’s 57% and every hour it’s gonna go down a percent, my coupon code. I was like, “That’s so complicated. It’s a dumb idea. That’s my opinion, everyone has their opinions.” I’m like, “This is showing me where I’m dumb.” I thought he had sent it to me as a friend of his it’s my birthday.
I’m like, “Who emails everyone that it’s their birthday? That’s weird.” Then he was like, “No, it’s a marketing email. What a disaster?” Lo and behold he makes 9,500 bucks on the email. His average email makes 2,100, he made five times. Then he resets … Then the click count, what was it? It was 900 clicks out of 100,000 list. Not even 1% clicked on it, but he made five times the money he normally makes.

JD: That’s crazy.

Scott: He re-sends out the same email to anyone that didn’t open it, made another nine grand at dinner. I was like, “He made 18 grand out off this email that I thought was horrible.” What do I know? He made 18 bucks on his birthday because he trusted the data which was, look at all the sales coming in that are clicking off this email instead of, what’s Scott’s opinion of the email and a few other people?

JD: To get a little bit granular on that, it’s not uncommon for a marketer like me to, and I’m kind of joking when I say this because I do it all the time, to do our level best. Sometimes we’ll run three iterations, three variations of email, typically all your split testing is the subject line, you can optimize for click-throughs typically or a combination of opens and click-throughs. None of that on the front-end is attributing or taking into account conversions. Is there a best practice that you would recommend for an email marketer to be able to, let’s say you’ve got a list of 150,000 on your email list, good emails, and you want to run a promotion. There is just a lot to it.
Typically, how quickly does somebody respond and take action, but is there a best practice that you’ve recommended Scott for people to not broadcast that to actually test and see what kind of conversions come back and then iterate on that without just blowing the whole list at the first shot?

Scott: If you have a big enough list you can do that. You’ve got to get to statistical significance though. What we more see is that when people are throwing everyone in a specific funnel you can … Let me back that up. With email there is like quality of signal, and for us the biggest quality signal is they bought, because that’s why we are in business. People got to buy, who cares so much about the email? Then the second most quality signal is the click, because if they want to go click and look at whatever you send that’s still a strong signal and maybe they just weren’t and they couldn’t buy, they had to go to, they get a text, or who knows?
With the open rates that’s where people tend to focus on first. I’ve got to get my emails open, and I would argue and it’s the third on the towing pole because first of all it’s not an accurate metric. You don’t know if the open rates aren’t accurate because they’ve got to have images turned on. A lot of times they don’t, or it’s blocked from some ad blocker or whatever. That’s the least reliable metric, and yet some people always look at first. I understand, you spent your time writing an email, you want to know if people are gonna read it. I’m the same way. I still like to know that people opened it. When you are judging what you should be doing, you’ve got to work backwards, which is which one is getting the sales or at least which one is getting the clicks?
You are getting a lot of clicks and you are not getting a lot of sales, you know you’ve got to a good email, you just got to work on the offer. You are getting a lot of sales not a lot of clicks, you’ve got a killer offer, you just got triangulate more people to click on it, it kind of clarifies where the work is. For an actual number of how many descend out of that 150, I don’t, because it just depends on when you hit significance which is a whole another topic JD. I usually do rule of a thumb instead, I’d be like, let’s split, let’s send half to one and half to another, and then learn and iterate for the next email. I don’t generally throttle … Just because it’s kind of complex and then you’ve got to … There is a lot of dots you’ve got connect. I prefer let’s learn on this email, and then the next one we incorporate the learning. That’s how I like to do it. I don’t know if it’s necessarily the best way. I just like it, because it’s achievable.

JD: Getting a business owner like me to just take a look at the data and then actually take action on it, that’s a big enough hurdle in and off itself even though it might be just laying there with gold all over it. I’m a marketer, I like writing stuff and putting out promotions and putting out offers. Getting made to slow down and really think about it and be strategic, that’s a challenge at times.

Scott: It is, Mark wasn’t a … He wasn’t a data driven guy. He’s artistic. He just said he got addicted because he’d send an email, he’d see sales come in, and he’d get to compare it against those other ones to try and beat it. He got fun thinking about strategies but then always saying, “Did it work or not?” Because that allowed him to be creative and test things, and then know, “I’m onto something. I can keep doing it.” Or, “Okay, I’ve got to switch gears.” Kinds of rains him in a little but also just focuses his creativity on the things that work.

JD: With that we could go a lot of different ways. Focusing creativity on the things that work. How do you think about the 80-20 principle or maybe it’s the 90-10 or the 95-5 principle as it comes to data and profit?

Scott: I think it’s very important, because the bigger your business is, the more data you are gonna have and the more it’s gonna turn into office space. It’s gonna be like the TPC reports, you’ve got to look at it, you are like, “Oh shit, I’ve got to look at my data.” You don’t want that feeling. 80-20 for sure is important. I’ve got a training course coming up right now on Facebook, how to scale with Facebook data. The whole premise is that, you don’t have to time to comb through every ad set ad combination.
You want to scale the winners and scale the losers. You just got to have the right foundation for what makes a loser or a winner, which is the customer journey, which is what’s your intent of the campaign? Are you showing this to cold traffic to try and get them to buy stuff out of nowhere? Are you just trying to get them on your list and you’re getting rid of them elsewhere? When you have an intent to a campaign, rather than just spray and pray and please buy, you can scale more intelligently and faster, because then when the campaign works you know why it works and you know who it worked on, you know where they were in relation to your brand.
It makes it much easier to say, “This was cold traffic, I generated leads, they buy in 12 days, they are now worth seven to one, I can spend money here. Then otherwise I ignore it and I stop it.

JD: Very powerful. I thought you were gonna go here a little bit ago when you were talking about statistical relevance I think is the term that you used.

Scott: Significance.

JD: Significance. How important is timing? Buyer behavior as it pertains to the time of day and how do you … Do you leverage that at all?

Scott: Yes. I wish people just woke up and immediately ran to their computer and bought Wicked Reports. Nobody does that. No one buys at their 8:00 am. They just don’t. Probably it has a function of the morning is being busy, but I’ve seen a couple of fitness people do pretty good in the mornings, because they are selling stuff to start your day better or to do your workout or try my workout or try my smoothie, whatever it is. It seems fitness do well in the morning but that’s about it.
Most things do better later in the day. When you are doing timing, I learned this from a guy Craig Jacobson. He fascinated me and his story was, it was people selling something to do with save your marriage or something like that. I think it was called save your marriage now, or something similar. They found that the buyers all occurred at 4:00 or 4:00 am, because either people were dreading going home to their spouse or … Maybe not dreading, but stressed out about the situation, or they were up all night and couldn’t sleep, so they were searching for a fix.
I was like, as someone remarried I totally resonated with that. A definitely more educated choice my second time. Maybe my ex is listening for that. That really struck a cord, and I was like, “Hey man. I came to build a report kind of based on that. Are you cool with that?” He’s like, “Sure, it’s awesome.” What you’ve got do though is you’ve got to convert your buyers into their timezone. You can’t just take your order time in Shopify and Unific and just … You’ve got to say, they are in California and my order time says 8:00 pm or really it was 5:00 pm. If you aggregate them that way though, there is always a couple of times that stand out always.
In almost 90% of the people I’ve seen, they’ve got a few interesting spikes. With Mark at get main lobster it was 11:00 on a Monday. People act different only than off, because I’m originally from Maine. No one wakes up Monday morning and runs to the lobster pound to buy a lobster, unless it’s July 4th and you are having a noon cookout. Otherwise, you are not gonna do that. People online were planning their shipments so that, the ladies that do most of the buying would do it, wake up and deal with whatever with they are dealing with. All kinds of different profiles, but either the mom that’s getting the kids to school, or the worker that’s dealing with their morning stuff and then gets close to lunch time, they get hungry and then they think about the weekend, then they buy a lobster.
That was proven out, spiked out from the data, there were spikes at 11:00 and 4:00 pm, which was interesting. The digital … Not digital market themselves but all the digital marketing companies, they do really good at night because people are trying to do training and they got their day jobs, or they are trying to get out of their day job, they want to buy and do training at night. A lot of night emails can hit a cord with people when you see your sales are spiking. That’s when it’s at top of mind. That’s when you should be trying to talk to them. It makes total sense.

JD: How do you keep from skewing the data? Because if you were to import all of my timing of purchase orders, I’ve got a lot of emails that have gone out at 5:00 pm mountain time. Some months we’ll send a couple of million emails. You’ve got all of this interaction, all this communication that is, especially if it’s promotion driven, which 50% of ours are, where there is … Most all of them have a call to action. I don’t want to commit that crime and not have a call to action in my emails. Skewing the data a little bit. How do you sift through that Scott?

Scott: You have to look at relative sales compared to … It all comes back to your personal averages. And then also you want to look at, for example in that case let’s say you sent one at 8:00 am one day and you got 100 sales and you sent one at 5:00 pm and you got to 200 sales, I want just to keep it easy. Hey, 5:00 pm is better. Rocket scientist over here that I am. It’s about the relative.
Yeah, you do want to test. If you just always send them at the same time, at 5:00 mountain, then your mornings are gonna look terrible, because you’ve never given that a chance. You have to actually give the different times a chance or the different sections of the day a chance to then be fair. When there is a big leap in either sale count or revenue for a specific time becomes clear that that’s the time and then you just use it going forward. Then whenever you get curious or you have a bad performing email then you can say, “You know what? The next one I’m gonna send at a different time just to make sure my relative sales are still holding for the time.” That makes sense. That’s a tricky one though. You have to do some thinking.
You got to be like, on October 1st I sent the 8:00 am email, let’s look at what happened there, because you can filter for our buying time. You can filter it by any date range, so you can just look at specific days to see the skew at the time of the orders, and then you’d have to also know when you sent that email though, and then you’d be able to figure it out.

JD: Are there clients of yours that are day-parting their ad spend? Like Digital Marketer or some? I don’t even know that you can on Facebook.

Scott: I don’t know actually. I’m not sure. I wish I knew, I’d just be pontificating and theorizing, I don’t actually know.

JD: What do you see crushing it right now with your clients, what channels or media type? You hear all the reds, I was at Content & Commerce in LA and, you hear all the reds of Facebook live videos and driving traffic to that using that in your ads and video this and video that. I talked to a Facebook agency just the other day, the guy you used the founder for him, he used to work inside of Facebook, and he said Facebook loves video. They love videos, you’ve got to pump out that video. What do you see on your side Scott?

Scott: Video has worked pretty well I would say. It definitely impacts people. That’s one case where it is, that’s a challenging thing to track. Videos worked well but Facebook is still working great. Intelligent retargeting, not just hit them with a retargeting, they want to hit my site. Retargeting because they were in your cart but they didn’t hit that thank you for buying page. Those always murder. I have not seen one that’s done bad, whenever I’ve looked at one and said, “Hey, look at this one.” There is always like some massive ROI. That’s key to know because the cost per clicks are a lot higher, because the audience is small. You have abandoned carts in a day, Facebook is gonna charge maybe a 1.50 or two bucks, who knows?
You’ll be like I’ve got to pay this higher cost per click. Those just click. Abandoning cart, Unific, the abandoned cart email, you’ve got to have that. You need that abandoned cart audience following people around as well on Facebook, it’s huge.

JD: That’s cool.

Scott: Then consistency. Just consistency of getting leads, emailing them to buy, checking to see if you have got ROI, the people that just consistently keep doing that continue to make more money. If you just go willy-nilly with without a consolidated, I have a plan and then I’m gonna see how it goes and then iterate on that. They are less successful. It’s not so much the specific secret killer channel as the process, the more sounder the process the more success we usually see, consistency in having a sound process I’d say is more important.

JD: It’s like blocking and tackling, right? Or catching the ball, shooting the ball. Whatever sport you are in, it comes back to the basics, to the foundations and just doing that, doing that and doing that and doing that. Then you are prepared to hit it out of the park if you infect that right pitch. I’m using three different sports analogy, so that’s really confusing. Your foundation is sound, you’ve been doing the right things, you are getting the reps in, and when the timing is right, when the stars align you can hit it out of the park.

Scott: That’s a good analogy. I was gonna use my, I’m new to crossfit, like three months in and I absolutely love it, but the foundation of doing the reps, the complex movement is correct, it’s just making a huge difference for me.

JD: That’s cool.

Scott: It’s hard, it’s hard to go slow, because you are like I’m lifting a lot more weight than I do in there, but the results and just the feeling are worth it. It’s kind of how it implies to data, it’s like you got to have a sound approach, and then it pays off. It doesn’t pay off immediately like, I tracked an email today, how come I never got this money? It’s the compound effect over time of all the knowledge that you learn, and the 80-20 you are sifting in and taking actions where there is juicy pockets of high value customers and cutting spends where it’s never leading to the bottom line.
A lot of it is coming and you’ve got a lot of wasted spend. You see a lot of interaction and it’s not really paying off at the bottom line, that’s a common occurrence unfortunately.

JD: Right.

Scott: There is one other thing with video that you mentioned that struck me to mention is that Facebook has something called offline conversions. It’s called offline conversions, because in Facebook’s mind, it’s like the pixel is gonna attract the sale, and if it doesn’t and you have the sale offline, you can upload it and we’ll track what happened. What it really means is real sales, because you can submit all your order data and then Facebook uses that in their algorithms. Whenever you are targeting someone they’ve got your customer data and values. That means for all the thousands of signals they use they can cherry pick for you the people most likely to convert for whatever you are doing, based on similarity to your customers without you having to go through a bunch of rigmarole in Facebook ad manager to tell them that.
Everyone out there listening, you’ve got to set up offline conversions. Facebook platforms, it’s all a data game, all these algorithms running, they need great data. There is no better data than your customer data. I just want to throw that in there. People need to set that up one way or another. It’s critical.

JD: That’s awesome. I’ve got to check into that because it’s an area that I don’t think that we have set up at all. I want to do that. That’s awesome. Thank you for that.

Scott: It’s a must, because whoever is doing it in your niche, is gonna be beating you on the ad sets. They are gonna cherry pick the better customers, because Facebook knows with more certainty who they are for that particular advertiser.

JD: I’ve got a couple of more questions for you. It’s been so good, a lot of actionable content. Do you see with the auction on Facebook specifically becoming more and more expensive, more and more competitive, I think in 2016 there are three and half million advertisers, right now there is 5,000,000 advertisers on Facebook, are your clients going negative? Is that a common practice getting that first conversion? Do you see them talking about maximum allowable cost per sale, how far am I gonna go in the read, how long is gonna take me to breakeven? Those kind of high level conversations?

Scott: This is exact training module I cut a couple of days ago for a course, because it’s such a challenging thing to, I always think of it like brave heart where they are all charging him and he’s yelling at all the guys to hold the spears not to lift them. This happens, the days of hey, I’m gonna have a self liquidating offer that pays for itself the same day. That still happens but it’s harder, because the inventory is dried up, so the cost per clicks are higher. You’ve got convert more to be able to breakeven day one or be profitable. It does happen but it happens less.
The negative ROI at the start particularly for cold traffic lead-gen is prevalent. It matters … How should I say this? It’s very dependent on your business. If you ever a higher ticket item or there is an education process, cold traffic isn’t just gonna roll out of bed and hand over their credit card. You’ve got nurture them. The more you are gonna nurture, the more you are gonna run the in the red when you are doing lead-gen. We always run in the red with lead-gen with Wicked Reports when we started, because it’s a commitment. It’s not the cheapest analytic tool out there.
There is a learning curve and you get to commit to okay, I’m finally gonna deal with my data, which not everyone wants to do, I wish they did, but they just don’t. There is that factor, we have to hold in and run ads and then stop them and then wait and see if customers came out of all the demos booked from the ad sets. Any multi-touch funnel, multi-step funnel you are gonna see that. For sure, it happens a fair amount.

JD: That’s cool. One of the things in having a great business. I can’t remember if it’s Warren Buffet or who, but one of the things that’s critical is that you have a wide mote around your business. A lot of times that’s a patent or some intellectual property that you control. You have a proprietary way of delivering this medicine or whatever. Having a upside down cost of acquisition, a negative, if you go negative pretty significantly, it can actually be a positive thing I think. Even though it just is painful, because you know that when you are gonna light up a campaign that you are gonna go in the red. It’s gonna take you a little while to dig out of that hole, but actually can be a competitive advantage if you are in it for the long haul don’t you think?

Scott: Yes, and I was talking about this at Content & Commerce, where I got a little too data nerdy about it, but I feel like Wicked Reports, our average price point is 299. If someone buys in 60 days they’ve spent 900 bucks. That means if we want to say we want to be breakeven at 90 days, we can spend 900 bucks in the whole lifecycle of that customer to acquire them. We can’t go out and spend 900 bucks for cold traffic clicks. You’ve got reverse the math from the sale, you start with the lifetime value of when you need to be breakeven, and you go back in time with each step, and then you can bid accordingly on those steps.
Maybe with cold traffic you are doing a lot of spray and pray, but then when someone is on your list, and maybe there is another step like a demo, or you want them to opt in to get a coupon, you can bid a lot higher, because they already warm enough on your list and you are trying to get them to just download this coupon on Facebook and finally use it God dammit. If you know, my customers are gonna buy three times a year, they are gonna spend 100 bucks. I want to make 50 bucks, so I can spend 50.
At that point, let’s say in the coupon you convert one out of two. That means you can spend 25 bucks to get people to opt into that coupon. You segment your audience and you say for people on my list that haven’t become customers, I want to show them the coupon and I’ll pay 25 bucks. Then Facebook will throw you a lot of traffic your way because it’s a big enough audience. Then are spending, you are putting your best foot forward on where you think you have your best chances of converting and you are spending your maximum amount, because they’ll give you less than your high bid. The auction how it works is they are gonna generally try to undercut what you’ve … They are gonna try to reward you with an honest bid by giving you way less. I don’t know if you know how the auction works or if that’s getting too into it here.

JD: No. I love it. I don’t really know how the auction works, even though we spend a couple of million dollars on Facebook. I have some smart people and I grew up in around auctions, cattle auctions. My dad is an auto-buyer, so I grew up in sale barns and around cattle. I’m very familiar with online and live auctions and things. The add, these big gigantic ads and the technology that connects all of it and the algorithms are just mind boggling to me. I don’t know how they do it all.

Scott: It’s fascinating. It’s called Vickrey–Groves-Clarke … What’s the third guy? Vickrey–Groves-Clarke mechanism. What it means is we want you to bid truthfully for what this is worth and in exchange we’ll try our best to give it to you cheaper in as much of it as possible. They are hoping it’s gonna make you bid more, but at the same time it is a beautiful idea to do this. Let’s say I know that a lead, someone whose seen a demo Wicked Reports, that’s our best lead. We want to close them.
We know, hey, they are probably gonna be worth 900 bucks in 60 days if we can just get them to click buy, there is no reason they shouldn’t in our minds. At that point they are worth a lot of money. Let’s say one of out of 10 that attend a demo buy. That means I get one in 10 chance that that person is gonna click the ad and buy if I can stay on their radar, with email and everything else I’m trying to do. If I need to break even in 90 days, or let’s say I want to double my money. I can spend 250 bucks, one in 10 conversion rate means I can spend 45 bucks on that person. I’m bidding 45 bucks for them, and let’s say they are also in an ad set of yours that it’s a lady who wants a headband as well, and you are bidding five bucks.
They are gonna give it to me at five bucks because I bid more, but you are the second price bid. There is a few other technicalities in there, so it’s technically a little different than that but not much. I can clean up all day. If it was a bunch of ladies that wanted headbands, that also want Wicked Reports, I’m gonna get all of them, my ad is gonna win every single time until … And if no one takes action then Facebook will penalize me, but I’ll win at your lower price, because you get second price bid or a little bit lower than that sometimes even.

JD: You and I, right now I have my fist raised. I’m just kidding by the way, especially if you’ve been doing crossfit. My wife does crossfit. She’s been in it for like four years or more. Every time I go it just kicks my butt and I either want to throw up or crawl under a shade tree and just lay there and just suffer. I hate it. I hate crossfit.

Scott: It is completely love or hate. People say, it seems like a cult. I’m like, “It kind of is, because you are either love it. You absolutely want to talk about it all day or you think those people are crazy and stupid and they are gonna get hurt.”

JD: Exactly. And they’ve got all this whole language, morph and to bother-

Scott: Word.

JD: Word and all these words. It’s been four years and I’m kind of just now getting what they mean. It’s crazy. I got two great questions, I hope they are great. Knowing what you know now Scott, what business would you start if you had the time and energy for it? If it’s Wicked Reports, that’s awesome. But knowing what you know now, doing all that you’ve done, seeing all that you have seen, inside of your business and outside, if you had the time and energy for it, what would you do?

Scott: I’d sell online training. It’s something I’m really good at. That’s why we are doing that for Wicked Reports actually. So many people are making so much money in all these random online training niches. It’s just mind-blowing. Someone is doing how to be a proofreader and just killing it. He came up and started talking to us at a booth, telling us what he was doing. Who wants to be a proofreader? A lot of people do apparently. He’s killing it. I didn’t see his data but he was telling me he was doing over half a million year selling how to be a proofreader, because it’s easy, once you’ve done the training and if it’s something you are passionate about, then it’s just marketing the thing, which not that that is easy but there is a lot of people that know how to market training really well. You just got to hire one, and you sit back and collect money, a lot of people online-

JD: You know that these guys lie, right? You know that some of these info-marketers lie?

Scott: Yeah.

JD: I hope he didn’t. My last question, what does the future look like in your eyes for eCommerce?

Scott: I think it’s only gonna grow, but also the savvier marketers are gonna keep winning and the rest are gonna have to pick up the scraps, because some of these technology advances, and some of the ways you can target, speak, and talk to people, people that hone that in are just gonna be able to outspend and crash newcomers coming in. I feel like it’s gonna become more advanced and bigger in general.

JD: Very cool. Scott, thank you so much for your time. Thanks for joining us on eCommerce In The Trenches. How can people find out about you and some of these trainings that you are talking about putting out that sound like really valuable?

Scott: Thanks. Wickedreports.com is our site. You can go there and poke around to see what we are about and book a demo if it catches your eye. The wicked academy is the forthcoming training. If you are not quite read to dip your toe into Wicked Reports, or still want to become more data driven, that’s what we have coming out here in the next month.

JD: Check out Scott and Wicked Reports and it’s been great. I love your accent, and I love what you do to help us guys that don’t know how to handle all these numbers make sense.

Scott: Awesome. Thanks for having me JD. It was really fun.

JD: Be good.

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