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Successful online paid advertising – a conversation with Yaron Been
19 Plays6 days ago
Yaron Been is the founder of EcomXFactor, and other ecommerce related businesses.
Yaron was encouraged to set-up an on-line store by a friend who had been successful. He ran this store, with his wife as a side gig to his day job for two years. After two years that business was successful enough for both Yaron and his wife to focus on ecommerce full time and adopt a digital nomad approach to working.
Yaron now focuses his business activities on sharing what he has learnt about digital advertising.
In this episode of the Abeceder podcast The Independent Minds, Yaron shares with host Michael Millward the logical approach to paid online advertising.
Michael describes how not understanding advertising led him to use content as a way of raising the online presence of his web shop Work Place Learning Centre.
Yaron explains how content can be used effectively within a marketing campaign, and how it contributes to the data that digital advertising generates to improve advertising and relationships with customers.
He describes how advertisers who take the long-term view when advertising online enjoy more success than advertisers who want instant returns. he learnt about how to create a commercial advantage from being an inclusive employer.
More information about Yaron Been and Michael Millward is available at abeceder.co.uk.
The Independent Minds is made on Zencastr, because as the all-in-one podcasting platform, Zencastr really does make creating content so easy.
If you would like to try podcasting using Zencastr visit zencastr.com/pricing and use our offer code ABECEDER.
Travel
Yaron is based in Georgia. With discounted membership of the Ultimate Travel Club, you can travel to Georgia, or anywhere else at trade prices on flights, hotels, trains, and so many more travel related purchases.
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Being a Guest
We recommend that potential guests take one of the podcasting guest training programmes available from Work Place Learning Centre.
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Transcript
Introduction to Independent Minds Podcast
00:00:05
Speaker
Made on Zencastr. Hello and welcome to the Independent Minds, a series of conversations between Abysseedah and people who think outside the box about how work works, with the aim of creating better workplace experiences for every everyone.
00:00:23
Speaker
I am your host, Michael Millward, Managing Director of Abysseedah.
00:00:29
Speaker
As the jingle at the start of this podcast says, The Independent Minds is made on Zencastr. Zencastr is the all-in-one podcasting platform on which you can create your podcast in one place and then distribute it to the major platforms so like Spotify, Apple, Google and Amazon.
00:00:49
Speaker
It really does make creating content so easy. If you would like to try podcasting using zencastr visit Zencaster, visit zencaster.com forward slash pricing and use my offer code, Abysida.
00:01:03
Speaker
All the details are in the description. Now that I have told you how wonderful Zencaster is for making podcasts, we should make one. One that will be well worth listening to, liking, downloading and subscribing to.
00:01:18
Speaker
Very importantly, on the Independent Minds, we won't be telling you what to think, but we are hoping to make you think.
Guest Introduction: Yaron Bean
00:01:26
Speaker
Today, my guest Independent Mind, who I met on Matchmaker.fm, is Yaron Bean.
00:01:34
Speaker
Yaron is the host of the Ecom X Factor podcast. He is also very, very popular with websites that host advertising. He spends a lot of money on advertising.
00:01:47
Speaker
As an example, he spent over $30 million dollars on Facebook adverts. That is a lot of hands-on experience with making Facebook ads work.
00:01:58
Speaker
Jaron has a unique perspective and expertise when it comes to paid advertising strategies. Let's see how many secrets we can coax out of him today. Jaron is speaking to me today from Georgia.
00:02:12
Speaker
I've never been to Georgia, but if I was going to visit, I would make my travel arrangements so at the Ultimate Travel Club. It is where I get trade prices on flights and hotels.
00:02:22
Speaker
You'll find a link and membership discount code in the description. Now it's time for Yaron. Hello, Yaron. Hi, Michael. How are you? I'm very well. Thank you very much. And hope that you can say the same.
00:02:34
Speaker
Yeah, for sure. I'm very excited to be here. All is well. Great, because I am really interested to find out all about paid advertising strategies and how it all works. And in the interest of transparency, I will explain why i why I'm so interested.
00:02:53
Speaker
Before then, please could we start by you telling us a little bit about you and how you ended up being an expert in paid advertising strategy?
From Special Forces to Digital Marketing
00:03:03
Speaker
Sure.
00:03:04
Speaker
Yeah, I guess my story starts in the army. Based on my accent, you can probably tell that I'm is from Israel. And i say I served in the special forces in Israel. And while I was doing so, I think I had the realization that I'm an independent mind.
00:03:21
Speaker
And I don't want and commanders or bosses above me, never in my life again. Right. And after finishing the army, I did a and a degree in industrial engineering and I started working in a Facebook ads agency in Tel Aviv.
00:03:37
Speaker
And luckily I met a child friend of mine for a drink and he showed me that he was making money from a side hustle. He was selling online. and And until that moment ah in time, i didn't believe that people were making money online. I thought that it was just Google are selling courses about dropshipping or e-commerce.
00:03:56
Speaker
making money online but i didn't know anyone that was actually making money online but since it was a childhood friend of mine i had to give it a go and the morning after my wife and i we built a store we knew nothing to be honest and we got lucky and in the same evening we were at dinner in my wife's ah at my wife's parents and we got our first sale congratulations Thank you. it was It was five years ago, but I still have goosebumps when I recall the moment because then we realized, okay, we can make this independently.
00:04:31
Speaker
And we started investing more and more in in the store while we were both working. and So we came back home from our nine to fives and worked until midnight and during the weekends.
00:04:42
Speaker
And did this two years. to two years until we felt confident enough that it's not volatile and we can really earn a living and even more with being independent.
00:04:56
Speaker
And at that point in time, we decided to leave Israel. We both quit our jobs and we left to Thailand. And since then, we've been digital nomads and we've been kind of living in different places all over the world.
00:05:08
Speaker
And we've been making most of our money, income from digital marketing, paid advertising, etc and i will pause here to let you ask any questions because i don't want to keep on mumbling it is really interesting because you it's one of those great digital era myths about people launching a web shop and then all of a sudden they're multi-millionaires there's an awful lot of work that goes into it and it's fantastic that you got your first order And I know from the the time that I got my first order on our webshop, Workplace Learning Center, that when that first order comes in, you're quite right.
00:05:49
Speaker
No matter how many orders you do get over how many length of time it might be, that first order, just thinking about it, just gives you those little goosebumps of of excitement when you remember you weren't sure whether anybody would find you and They do, and they buy something from you, and that's fantastic.
00:06:09
Speaker
I think when we started webshop, there were not as many webshops around as there are now. and There were not as many noises that that you have to break through in order to make sure that the right person who's looking for the thing that you are wanting to sell is actually finding you at the right time.
Advertising: Content vs. Paid
00:06:30
Speaker
I mentioned in the interest of transparency that I'd sort of like share some of my cynicism about advertising because when I first started, I spoke to an advertising agency and and one of the first things they told me was that 80% of your advertising is not going to work.
00:06:48
Speaker
Only 20% of your advertising is going to work. But identifying which 20% works is very, very difficult. And I thought, I am just starting out in this business. I need to make sure that people are aware that I exist.
00:07:05
Speaker
But do I want to be spending 80% of my marketing budget on things that don't work? And we went down creating a lot of content, which explained what we did and what the products did.
00:07:17
Speaker
As a result of that, we started getting sales. So there is a bit of a mix online. It's like the paid advertising, and the natural search results. Do both of them. Get your search engine optimization right, get your content right, and people will find you because the search engines have found you.
00:07:35
Speaker
Or you can circumnavigate all of that and go for the paid advertising. I'm here to learn and I want to understand much, much more about this. So yeah, you sort think no you don't want to hog the conversation, but I want to hear. I meant it when I said like, how many secrets are we going to get out of Yaron today? What can we, what can we learn about this?
00:07:56
Speaker
No, so sure. I'm happy to share, happy to share, but. Great stuff. Great. You mentioned something that is very important and I will relate this to my answer. Many people say that content is king, but I believe that context is king.
00:08:11
Speaker
And i just heard the other day a quote that says there are no solutions, only trade-offs. So I'm not saying that paid marketing is the silver bullet for everything or anything. And some people do succeed very magnificently with the only content and SEO stuff like this.
00:08:31
Speaker
But at the end of the day, you need to weigh your alternatives. Like the agency said, you need to weigh your alternatives and you must find the solution, the 20% that works.
Advantages of Paid Advertising
00:08:42
Speaker
Now, the reason why I prefer paid advertising, and again, I'm not saying that you shouldn't do content. I think that they work together as a compliment. At the end of the we have...
00:08:55
Speaker
unlimited resources. We have time and we have money. These are the resources that I think about that are most relevant to the business space. So if you have a lot of time and you have patience, you can invest it in building organic method, organic strategy.
00:09:13
Speaker
But the thing is, it is risky because organic usually has m takes more time, takes longer. And you don't see results. The feedback cycle, the feedback loop is way longer. So you can upload a blog and only get it ranked after three months or six months or even more. Or you can start a YouTube channel, and it might take you five years until you hit like the the the critical mass and then start seeing traction.
00:09:41
Speaker
While on the other hand, we have paid marketing, which you don't need to invest much time. You need to, you exchange time for money. So you put in the money into Facebook ads, Google ads, TikTok ad or whatever. And within two days or seven days maximum, you already start getting a lot of data.
00:10:02
Speaker
way more data than you could have possibly achieved when you're on your own doing organic stuff so this is like the biggest factor in my mind why i prefer doing stuff that scales and scales faster so it either are doing paid or doing automation this is how i see marketing because when you're just on one man show doing organic you have to invest ah a lot of time to out-compete the competitors which are probably also doing a lot of work yes yes and i suppose when you talk about you after seven days you can get a lot of data you're getting data about the people or the organizations that are seeing the adverts that you're paying for so it then becomes easier i suppose
00:10:50
Speaker
from what you're saying, to make sure that people who want to buy what you have got to sell are more likely to see your advertisement.
Data Utilization in Advertising
00:11:00
Speaker
Exactly. And it's not only is this. some some Some people use paid marketing as a means of experimenting just to figure out what they should sell.
00:11:10
Speaker
So if I give, for example, our dropshipping business, when we just started out, as I told you, we launched... ads on the first day.
00:11:21
Speaker
And if we did organic, we probably it would take us six months to get a first sale. So we launched ads on the first day, the mom, the morning after I met my friend and we launched 10 different ads for 10 different products.
00:11:34
Speaker
And we paid 10 bucks for each, for marketing each product. And this way we got the sale for a specific product. I don't even remember what was it, but this made us think, okay, this product probably has more potential than the other products. So we can double down on it and we can eliminate the other products. So using paid ads is also allows you a lot of room for experimentation and getting data from the market.
00:12:05
Speaker
regarding your pricing, you're regarding who are you targeting, regarding your offer. just gives you data much faster than organically. Yes, so the the data that you're getting helps you see what level of interest your advertisement or advertisements have had from your potential audience.
00:12:27
Speaker
And so that then helps you define what it is that you need to be selling or what it is that you need to be promoting from all of the things that you're selling. Because I suppose...
00:12:40
Speaker
There will but always be, regardless of how many products you have in your catalog, there will always be a product or a range of products that attracts more interest than other products. Yeah, definitely. i agree. I mean, yeah, the data that you get helps you identify that.
00:12:56
Speaker
Please carry on. Exactly. Sorry. So I am a big believer in the Pareto principle and I've worked with many e-commerce businesses and what I usually see 20% of the products produce 80% of the revenue.
00:13:12
Speaker
So even if you have a huge store, it's going to allow you to weed out what it doesn't resonate with the audience so much and what are the products that you can really, or line of products that you can really double down on and you know that your customers...
00:13:26
Speaker
seem to be showing interest and are willing to pay. Right. Because at the end of the day, if people are not paying, you don't have a business. That's true. and so So you need to gain data very fast in order to understand if people are paying and you have a business or not. Yes, that's very important.
00:13:43
Speaker
In order to have a business, you have to have people who are prepared to pay for what it is you do or what you sell. Is it feasible to say if this product is what customers want to buy at the moment, you use that, that's that becomes the product or the service this that you advertise.
00:14:02
Speaker
From there, you once you've got them into your shop, you can then advertise within your shop or target advertisements to them outside of your room on these various different um platforms.
00:14:17
Speaker
that would tell them about another product. So you're not just getting them to buy more of what they've already bought, but you enabled the data that you gather enables you to perhaps present alternative options to them as well as to what they might buy that complements the things that they've already bought.
Customer Value vs. Immediate Profit
00:14:39
Speaker
Yes, definitely. um A lot of businesses these days, because marketing a cost has been on the rise, it's constantly rising and it's very expensive these days to acquire a customer.
00:14:52
Speaker
A lot of businesses, they mostly rely on the lifetime value of the customer. So they don't expect to make much money. from the initial purchase. So let's say I'm selling a shapewear.
00:15:04
Speaker
No, let's say a skincare product. So if the skincare product costs 50 US dollars, fifty u s dollars or pounds, some brands are willing to spend 60 pounds on Facebook ads in order to get one customer under the realization that afterwards the customer is going to rep repeat on buying. So they are going to send him more offers or more discounts or promotions via email.
00:15:30
Speaker
they are going to take the list of the customers that bought from them and put it into Facebook ads and then show all these customers more Facebook ads regarding complementary products or the same product again within one month or six months, et cetera. So once you acquire customer, you gather more data about the customers and you can definitely remarket to them.
00:15:53
Speaker
That's an interesting point that you raised there. The product costs 50 pounds, 50 dollars. Choose your currency. But the organization has a strategy of paying 60 dollars in advertising to get a customer for a product that costs 50 dollars.
00:16:13
Speaker
So they're losing 10 dollars on that product. In fact, they're losing more than 10 dollars on that product. They're losing a lot of them, they're losing all, well, how much would they be losing?
00:16:26
Speaker
They'd be losing the cost of the advertising plus the cost of the wholesale cost of the product that they're selling. So they could be on a product that costs $50 to buy. They could actually be losing a hundred dollars because of the cost of advertising and the cost of the product, the cost of the shipping, all these sorts of things.
00:16:46
Speaker
But what you're saying is that we should take the longterm view with our advertising work out the product that is going to be the repeat product that people will buy and need to buy again, and then take that risk, make that investment in advertising, paid advertising, which means that they get into your organization, start buying from you, and then focus on building the loyalty, which can then come with either more advertising that is very targeted, or might come from content, which is
00:17:20
Speaker
Did you know this about the product? Did you know that about the product? This is how somebody else is using it. Those sorts of things that once they're into it, you can do more with content. But this this is an unusual idea.
00:17:32
Speaker
You actually have a product that is a loss leader in the first purchase, but you're looking for the second purchase. Exactly. Exactly. Which means your advertising has to be be focused on building the relationship that will enable the second, third and fourth and fifth per purchase.
00:17:54
Speaker
Exactly. this is This is called lifetime value analysis. You basically make an analysis of the average each customer spends with you within six months, one year, two years, and his whole lifetime value. So let's say customers, let's assume that I'm selling a product that women use for 30 years and they buy on a monthly basis for 20 quid.
00:18:20
Speaker
So i didn't I shouldn't even mind paying 500 quid just to acquire the customer because after a while it's going to become very profitable. and And this is what many businesses are doing these days, but you need to take into account your cash flow issues because this might create cash flow issues because you don't have you need to regain the money later.
00:18:42
Speaker
him So there are many calculations that need to be taken into account, but it's very popular and I see it very often that people are willing... to lose money on the front end. This is called losing money on the front end. Front end is the first sale.
00:18:56
Speaker
People are willing to lose money because they realize that they will regain the money afterwards, assuming that they treat the customers right and the product has a high lifetime value because people are going to come and being returning buyers.
00:19:12
Speaker
Yes, but if I am launching a webshop, part of the things that I need to consider is the cost of acquiring a customer and then the lifetime value of that customer and not think in terms of just that one individual sale. Like you say, if you have a product that people need to buy on a regular basis, they could be buying it on a regular basis for 10, 20, or 30 years.
00:19:40
Speaker
And that's what you've got to think about in terms of your advertising is how do I get the customer who is going to have a high lifetime value rather than just the quick one-off sale.
Paid Ads vs. Organic Content
00:19:53
Speaker
Exactly. and And we see this very often, let's say Revolut or Wise, they might offer you or even a bank or or a platform for investing money. They might offer you like 200 quid when you just join.
00:20:08
Speaker
for using Revolut. First 200 fees for free, stuff like this, because they realize that this will lure you to join them, seduce you to join the platform.
00:20:21
Speaker
But afterwards Revolut, they are going to make way more money from fees and providing you services because you're probably not going to leave them after you just get got started. And this is why they are willing to give away 200 quid, for example.
00:20:36
Speaker
Yeah, and as well as there's a shoe repair company in the UK. but They sell batteries for watches. So you go in with your watch. The first time your battery runs out and you buy a battery, you pay a little bit extra for that battery, but then they give you a card. And when the battery runs out, you can go back and they will give you a free battery.
00:20:57
Speaker
Well, they can't be making any money on this. I said, no, but it means that you come into the shop and you will buy, you'll see something else that you want to buy. And that keeping that card in the box with the watch means like, yeah, I know i that's an expense that has been withdrawn. I don't need to worry about spending that money anymore.
00:21:18
Speaker
That I paid extra for the first battery, but that means the second, third, fourth, fifth, sixth, whatever batteries are going to be free. And yeah, I might buy some shoe polish whilst I'm in there.
00:21:30
Speaker
I'll get the battery exchanged and I'll take that pair of shoes in that need re-soling at the same time. There's psychology to it, but there's also this value of understanding the lifetime value of the relationship with the customer and what they will purchase rather than simply, i spent this much on this advertisement, I haven't made my money back, people aren't buying enough.
00:21:56
Speaker
that means the advertising hasn't worked. You've got to what you're saying is, you know, the key secret to making ah paid advertising work online would be, well, a couple of secrets that you've shared, I suppose, is like,
00:22:12
Speaker
The first one is get the data and analyze the data. Understand what the earth what the advertising and the way in which people view the advertising is telling you about the level of interest in your product and potentially what people want to pay for it, what pay are people want to use for it.
00:22:31
Speaker
And the second secret of success for this online advertising is Taking the long view and using the advertising not so much as I want a quick hit, but what I want is you coming back as a customer time and time and time again so that we have a long-term relationship and that means that you as a customer coming are spending a lot of money with me and that adds value to you get service the service or the product that you want, but I am seeing regular regular sales of a product that you want to buy.
00:23:12
Speaker
And it's all down to that one ad advertisement, pulling the person in demonstrating what was possible, and then moving from there to the point where they subscribe to the product rather than making individual purchases.
00:23:25
Speaker
Exactly. Yeah. I went on a bit there, didn't I? But I saw it. I've learned. No, I'm glad you learned. No, it's no good. You explained this better than I did. Well, I didn't understand it At the beginning, that's the thing.
00:23:38
Speaker
But your explanation of using the advertising to generate the data around your customers and what it is they want to see advertisements for, what it is they're prepared to buy, well, those sorts of things, that, because it's digital, because it's online, that is something that an advertisement in a magazine, newspaper, those sorts of places will never tell you.
00:24:00
Speaker
But this other thing that you need to take the long-term view, with everything. Take the long-term view around making sure that you build you use the advertising to build that relationship to get the repeat purchases and almost like a subscription, you want to build that relationship.
00:24:21
Speaker
And then you also mentioned about how ah content is good, advertising is good, but context is also essential in understanding when to use paid advertising, when to use organic content to make sure that you are building that relationship with the with the customer and working on and building that relationship.
00:24:47
Speaker
It is all all fascinating, but it's just listening to you. I'm just like, yeah, okay, that penny dropped. That penny dropped. One of the strange things is, though, Yaron, is that if you talk to one of the ah organizations that is trying to sell you these advertisements, they talk very short term.
Short-term vs. Long-term Advertising Strategy
00:25:08
Speaker
They don't seem to talk in the longer term, in the how will we make this work long term. It's all quick hit. This is an interesting observation.
00:25:19
Speaker
and i think it's also a derivative of the fact that a lot of customers, a lot of prospects of these agencies, they are also interested in the short term So the agencies just sell the short term because this is what most people focus on.
00:25:37
Speaker
So I don't think necessarily the agencies are wrong. It's just saying they know their customers. And maybe in the instance of speaking with you, which you have like a longer vision, long-term vision, they didn't nail it, but more often than not, people expect a fast results, not much effort, um and not much complexity.
00:25:57
Speaker
This is just the nature of of men. Yes, but ah like you say, there's there is some substance to that, some justification for that type of approach because you so you launched a site and sold within 24 hours, but that was in a, you could say, in a different era.
00:26:15
Speaker
The retail has moved online from the high street in many ways, but even it's about experiences, but There is an awful lot there to think about for me, as and I'm sure lots of other people as well.
00:26:30
Speaker
I am very grateful for the time that you've spent with me explaining these secret approaches to making the online advertising work. Thank you very much. Really appreciate your time. It was my pleasure. Thank you so much, Michael.
00:26:42
Speaker
you. i am michael milwardd the managing director of abisidda and i have been having conversation with the independent mind yaonin the host of the ecom x factorctor podcast you can find out more about both of us at abesidar dot code dot uk there is a link in the description there' a link to the podcast and to yarron's website which is ecom x f dot com I must remember to thank the team at matchmaker.fm for introducing me to Yaron.
00:27:17
Speaker
If you are a podcaster looking for guests with something interesting to say, or if like Yaron, you are looking for interesting podcasts to appear on, matchmaker.fm is where matches of great guests and great hosts are made.
00:27:32
Speaker
There is link to matchmaker.fm and an offer code in the description. The description is actually quite well worth reading. If you've liked this episode of The Independent Minds, please give it a like and download it so that you can listen anytime, anywhere.
00:27:47
Speaker
To make sure you don't miss out on future episodes, please subscribe. Remember, the aim of all the podcasts produced by Abusida is not to tell you what to think, but we do hope to make you think.
00:27:59
Speaker
Till the next episode of The Independent Minds, thank you to you for listening. Goodbye.