“It’s the easiest customer acquisition channel that I’ve ever seen.”
Also available on YouTube: https://youtu.be/djnSFyBsB7M
We explore Shopify’s latest updates to simplify customer acquisition through its Shop Campaigns tool.
Host Kurt Elster talks with Shopify's Andrius Baranauskas, Product Director for Shop Campaigns, Shopify's not-so-secret weapon for getting new customers on autopilot.
Later, Nathan Onesian, Director of Ecommerce from melin, and Nick Daniels, Senior Ecommerce Manager, from OluKai spill how Shop Campaigns turned into their secret weapon for scaling fast.
Key Takeaways:
Guests:
Andrius Baranauskas, Product Directorat Shopify
Nathan Onesian, Director of Ecommerce at melin
Nick Daniels, Senior Ecommerce Manager at OluKai
Links:
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Kurt Elster
This episode is sponsored in part by Omnisend. Shopify store owners, are you tired of juggling multiple tools to manage your marketing? Well, meet Omnisend, the only platform you'll ever need to skyrocket your e-com sales. With OmniSend, setting up e-com automations is so simple, you'll have them up and running before you finish your morning coffee. Plus, you can segment your customers based on their shopping habits and even dive into SMS or push notifications, all from one seamless dashboard. OmniSend Isn't just another marketing tool. It's the secret weapon behind over a hundred thousand successful e-com brands. Whether it's crafting eye-catching emails or sending out timely texts, Omnisend helps you connect with your customers like never before. Give your brand the boost it deserves. Don't wait. Your best campaigns are just a click away. Your dot omnisen. com slash unofficial Shopify Podcast. Omniscent. My friends, today on the unofficial Shopify podcast, I've got a Shopify feature that is so easy to set up. We've had clients set it up. I've set it up. And I don't think any of us actually know quite what it does, just that we make extra revenue with it. Well, that's good. I like that. And I'm told It has new features, new powers, new ways to help us provide a great experience for our customers. And of course we want that. Right? And so today we're going to have a a a A gentleman, a product manager, I believe, we'll find out, from the mothership, from Shopify, walk me through it. Cause I know the online store backwards and forwards. I love it. I live, eat, sleep, breathe that theme editor But when we leave the online store, I don't necessarily know what I'm doing. That's my dark secret. And so th this summer I I learned about point of sale. I really enjoyed that. Um, and I heard you know several of you reached out to me and said, Oh, you you had moved uh and and started with point of sale, so I'm glad to hear it. And I hope to be bringing you a similar opportunity now. So we're joined today by Andreas Baranaskus from Shopify. And Andreas, what how long have you been at Shopify and what do you do there?
Speaker 2
Yeah, I've been I've been in Shopify for almost four years now. Um and uh I started my Shopify journey working on a product that many merchants probably know uh Shopee uh the the wallet and the identity product that we have and checkout that accelerates the buy journey increases conversion and generally just makes more business to everyone And uh recently through the last year, I took a leadership position to look after advertising product portfolio that includes shop campaigns and shop audiences.
Kurt Elster
So Shopif I'm familiar with because I love it. I think anything that lets a Shopify merchant leverage the network effects of Shopify, those are my favorite Shopify features because they're a big part of the reason why. People will often migrate to Shopify and go, you know, it it looks it looks fairly similar, but suddenly everything works better. Well part of it's because for the customer, it's very easy to log in with ShopPay and have all your stuff filled out. So I'm sold on ShopPay, but I don't necessarily understand everything that Shop itself encompasses. Like I know there it's the Shop app. I have it on my phone. I just I logged back into it and showed me a bunch of relevant stuff that was like, hey, here's stores I'd ordered from in the past on Shopify, uh, as well as I think like stores I'd viewed and some client stores. But What I don't I don't think I've ever actually placed a purchase or done anything inside that shop app. Tell me about it. What what's this thing do?
Speaker 2
Yeah, you should you should make a purchase today. That's that's that's one. But uh shop shop as an app is a consumer-facing platform, uh like a shopping app. Uh it's trusted by tens of millions of people already. And it connects brands with uh shoppers that they would not like otherwise would not reach. Uh so very effectively a matchmaking app, you could you could say that. Uh we introduce merchants to the best possible customers and empower merchants to sell as seamlessly as possible in this native mobile environment. And form long-term relationships inside that app. And we see that uh the buyers are spending more money, are more likely to come back when they're actually buying through the shop app. And every day we see thousands of shoppers buying from independent brands that uh that are on Shopify. Uh so this is the shop app. There's also sign in the shop. uh shop pay and uh many other parts of the shop universe. Um the shop owners. Yeah, the shop owners, yeah, yeah, that's I like this term. We should we should use this more often.
Kurt Elster
the a holistic suite of of features and products that come together here and work well together. And it it's a little bit a la carte in terms of you what we opt into. So I've got my Shopify store and my Shopify checkout. And customers can log into it quickly with um what did you call what did you call it?
Speaker 2
Sign in with shop.
Kurt Elster
Sign in with shop. Yeah, that's the coolest. That's where it's just it So you give it your phone number, email, and it goes, hey, we'll just send you a code. And then it fills in the rest.
Speaker 2
Yes, exactly.
Kurt Elster
And then after I I've placed the purchase on my order confirmation page. I may see a note that says, hey, you should download the shop app, track your order. And so now I've got the the shop app. Of course, along the way, maybe I I paid with Shop Pay. uh is is part of this this suite of features.
Speaker 2
Uh you got some shop cash as well.
Kurt Elster
Right, and shop cash, which is shop cash a shop campaign.
Speaker 2
Yeah, it it it's linked. It's linked because when you have shop cash, you're looking for the best way to spend it. And uh you can spend it inside the shop app and uh you can spend shop cash on any merchant inside the shop app. Uh but on but some merchants you actually get the much better deal if you spend shop cash for them. And this is where shock campaigns come in. Like shock campaign is a way to get this type of behavior, to get net new customers, and so on.
Kurt Elster
Shop campaigns. This is interesting to me. I want to know more. I don't I have not I've seen this floating around. I have not personally like set up or run a shop campaign directly. Give me the high level. What's what's shop campaign all about? Why do I want to do it?
Speaker 2
Yeah, so shop shop campaigns really start with the notion of marketing being uh a tough thing, a hard thing to do, and um and marketing getting harder. This is what we hear from our merchants. We uh Every time we talk to them, the number one problem is how do I get uh net new buyers? Uh how do and how do I get them as efficiently as possible? And there are so many different platforms to do it, there's so many different platforms to run ads There's so many different ways to acquire customers. There's like affiliate marketing, there's creatives, and so on. Uh and usually doing anything, setting something up. is very hard. Just starting. And results are often uh very, very unpredictable. And uh costs of that are also growing. And results uh for for that cost that you invest take a lot take a long time to catch up. So uh what we saw is that hey, this is this is tough job even for the experienced marketer. And uh many merchants on Shopify actually have very little experience running marketing or they're just starting. And what happens is that the merchant growth is actually slower than it would be otherwise. It's a all of this complexity. is a real tax on merchants' growth. And many merchants could run their business faster and grow their business faster, but they're limited by complexity of it all So this is this is the problem. And what we do is we are trying to simplify the customer position altogether with shop campaigns. And um in uh in its own, it's you know risk-free customer acquisition program, uh helping to convert buyers on and off uh Shopify.
Kurt Elster
Risk-free customer acquisition?
Speaker 2
Yes, yes.
Kurt Elster
Okay, and I like the sound of that.
Speaker 2
Keep going. Uh so merchant when merchant creates a campaign uh in this product, they need to set three things. Uh they set the customer acquisition costs that they're willing to pay. That's what makes it risk-free. You you pay only for new customers and you pay that price that you set. So this is the first thing that you said. Second thing that you said is the target return on that spend, uh, which is a multiply in terms of how much volume I expect to generate for the added investment I'm making. And the third thing that you need to set is daily budget. So you set the customer position price, you set the target return on that spent, and you set the daily budget. Just three things And uh you could also choose, if you want so, uh to extend those campaigns to run not only on shop. But also on the largest ad platforms out there like Meta, Google, and we have more of them coming. But then Shopify does all the rest. Uh we create and we optimize the creative. We choose the best placements for that product. We target the best audience. We find the best incentive for that audience to convert. And again, the merchant only pays for net new customers and get the full access to their data.
Kurt Elster
Define net new customer for me.
Speaker 2
So net your customer is someone who have hasn't bought from your store. So there's no customer record that, hey, this specific customer, this email address, have made a purchase on your store ever.
Kurt Elster
It almost sounds too good to be true. Help us visualize it. Walk me through an example campaign. You know, I'm selling t-shirts, acme widgets, whatever. Snowboards. Snowboards would be the classic Shopify example.
Speaker 2
Yeah. You're selling snowboards and what uh what happens in in this case is that hey you you actually want to sell more snowboards. You want to get More buyers who are interested in snowboards. You know, the snowboard sells for let's say $400. Um and uh and when you're doing the customer acquisition, maybe you think about the customer acquisition and think, hey, I'm Willing to pay $100 for a customer. So in this case, you go into shop campaigns and you create a campaign and you set the customer acquisition cost at $100. You know that most of your snowbars sell for $300, $400. So you want to make sure that the purchase happens at roughly that level. So you set let's say target uh return on that spend at 2. 5 or 3. So the purchase is at least $250. As an example. And you set the daily budget on something like a thousand dollars a day, expecting to sell 10 snowbars. This is what you start with. Uh what happens is that in the shop app, this uh your snowbirds are uh become more visible. And the users inside the Shop app, and these are the buyers who make a lot of purchases with Shop Pay, they're looking where to spend their shop cash, they're looking for the next independent merchant to buy from. uh they see us numbers in a lot more prominent way and often accompanied accompanied by an incentive which is hey my shop cash is actually worth more in your store And as a result, you get more buyers and only buyers who have actually haven't bought snowboards before from you specifically. are getting that offer. No one else does.
Kurt Elster
So it knows has not has and hasn't made a purchase from me. So we're not going to waste impressions or ad spend on customers we already have. Exactly. We're only gonna show it to new people and we're able to identify good good prospects here. We're able to do some prospecting. It's not like a shotgun approach.
Speaker 2
Yeah, it's um we we're able to identify who are the best fit uh customers for you. Uh and most of the behavior inside the Shop app happens with customers being signed in Uh so we know who's actually browsing the app. Uh we know uh what they're interested in, um, and we can Make sure that they actually see the relevant uh content. Because it you just showed me like when we started the call, we sh you showed me the app and you saw make specific things that are atop of your feed. And the things that you see and the things that I see are actually different. And then There's like a thousands and millions of these combinations that become uh that make sure that are as relevant as possible to matchmake the buyers and the independent brands that are on the app.
Kurt Elster
So how long has shop how long has shop campaigns been around?
Speaker 2
So we've launched shop campaigns to all Shopify Plus merchants. mid last year in June last year. And we've also extended uh uh the product from US into Canada um July this year, early July this year.
Kurt Elster
So if I'm US or Canadian Shopify merchant, I can use this today.
Speaker 2
Yes. Yes. It's available for you today to all Shopify Plus merchants in both uh countries.
Kurt Elster
And I bet as a a product leader here that you have data points about this. And I bet there's some you're proud of. What what I'm sure one comes to mind, what is it?
Speaker 2
Yeah the the the one part that I'm uh very proud of that in just the first year in twenty twenty-three uh shopping pain's helped to acquire more than a million new customers to the merchants who participate in the program. And that happened just within the first year. Um We have uh quite a few merchants experiencing uh growth using this product. And um uh as a as an example, uh careway. uh has driven more than two million dollars in revenue uh leveraging the product. Uh we have Thrive Cos Cosmetics who acquired north of 15,000 new customers using shop campaigns. Um we have uh other brands that saved a lot on customer acquisition costs. Example is Unilever brand, Liquid IV, has reduced their customer acquisition cost by more than 40% using this product. Uh, we see a lot of success across the merchant base. And what's particularly exciting is that merchants are often starting conservative, starting small. And then we see that uh over time they actually lean in more and more into the product and depend more and more on uh uh for their customer growth on shop campaigns, which is always very exciting to see. It shows that the product works for them and they want to get more of it.
Kurt Elster
Hey, aren't you forgetting something? If you're not using OneClick Upsell, you're leaving 10 to 15% of your total Shopify revenue on the table. OneClick Upsell is the number one upsell app. for over 15,000 Shopify stores. Listen to these brands. Tushy, Dr. Squatch, Buffy and Victoria Beckham, and guess what? It's already made sellers just like you an extra $750 million in upsell revenue. With one click upsell, you can add It AI-powered upsell funnels to every product on your store, including upsells on your product pages, shopping cart, checkout. and thank you page, even on the shop app. So you increase your average order value automatically. And getting started is a breeze. You can install the app, launch your first upsell, and start making ten to fifteen percent more cash from every customer beginning on day one. As in today. Don't leave behind another dollar in free upsell revenue. Go to zipify. com slash curt and try one click upsell free for 30 days. That's zipify. com slash k. So you're seeing merchants dip their toe in the water while they were like, well, just let's just try it. Let's just run a little test campaign here. And then they at the end of it go, Yeah, that might be good for me. They do they they keep they stay with it. They spend more. They run future campaigns.
Speaker 2
Yes. Yes. That's uh that's what is particularly exciting.
Kurt Elster
Now if this has been available in the US since last year You have to have evolved it since then. You wouldn't be here if there weren't updates to this product. What's what's rolling out? What's new with shop campaigns? What's got you excited?
Speaker 2
Yes, uh we we're constantly evolving the product and uh we've uh we've invested a lot in making sure that the relevancy works as best as possible. uh that uh the buyers that merchants get are as best as possible. And uh and merchants really love shop campaigns. And uh what they love uh is the thing that We discussed us at the start that we are able to target and we are so precise about bringing net new customers. But that's not enough. In in the conversations that we have with our merchants, One more thing comes up, and many, many more things comes up, but one thing in particular uh keeps coming up is that uh there is a clear need to win back customers, merchants lost over time. That's the thing that just keeps coming back, and that's the thing that we are addressing right now. And uh we are launching a new audience uh targeting type for shock campaigns uh which will focus on the customers that haven't made a recent purchase for a while. And we call them Labs customers. And typically this is something that MerchantSolved try to solve through their own channels like email. But because shopping paints is so tightly integrated into Shopify that we are able to identify the customers uh so well uh we are actually able to provide this product. And we expect this uh thing to drive greater Light on value uh for merchant on the on their customer base uh without sacrificing that new customer growth as well. And this is going to be ability to run these two things side by side, both acquire new customers and then back the customers that purchased from you in the past. Um and that's the same thing.
Kurt Elster
So previously the only I my target my campaigns I could only target n new customers. And then My ROI or my ROAS was on net new customers.
Speaker 2
Yes, exactly.
Kurt Elster
And now I could do in addition to that, I could do Um, you're calling them lapse campaigns in uh Clavio, you you would call it a win back campaign, like that style campaign where a person made a purchase X amount of time has passed, you know, six months, 180 days, and they have not made another purchase. Okay, now we could start trying to bring woo woo that customer back to our store.
Speaker 2
Yes, exactly. And this is this is the thing which is, you know, like different different companies, different merchants call this problem differently. Um and uh and also think about this problem differently. For some merchants it's six months, for some merchants it's twelve months. And there's there's a flexibility built into the product and make sure that we match the merchant needs here. And they get exactly what they're actually going after.
Kurt Elster
What does the offer look like? Like I've got a lapse customer. How what is it that how are we bringing them back to the store? Let's just like, hey, you get 10% off.
Speaker 2
Um one one thing about shop campaigns that we often hear from our merchant base is that it's very, very low-lift product. It requires very little time. That's why I use the term autopilot. So even in this case, uh the exact uh need for the incentive, the ex exact size of the incentive and form of it is something that Shopify uh can determine uh the best. And it can be Different things. So it can be boosting the customer shop cash to an enticing discount that you talked about. But what the thing that we are actually going to leverage specifically for this case for the first time in shop campaigns Is offering a significant amount of cash back to convert. This is this is where our focus is going to be at the start. But this is not where we need to stop. I think we're this is where we'll go into uh more incentive types. In the future it could be things like free shipping and so on. There are so many different ways to determine like what actually makes the customer to convert. And driving the customer over the finish line to make the purchase is what's is actually key about about this product, about the incentive involved, and so on. And uh Shopify we're able to observe the scale and volume of millions of buyers. And we're equipped with with that scale to make the best decision possible. what it's going to make for that customer to convert.
Kurt Elster
And so they the offer might be something hey buy snowboard, get X percent back as shop cash, which acts as a credit that they could spend In the shop app at any Shopify store? How where can I spend my shop cash as a customer?
Speaker 2
Yeah, shop cash is spendable inside the shop app and uh also shop uh website
Kurt Elster
Cashback is a pretty powerful incentive to get people to buy. Yeah, well, it works on me anyway. I'm like, wait a second, you'll do six percent cash back on this? I'd be losing money if I didn't buy it. Right? Like that's it give me the excuse to make the purchase, right? So I could I could convince myself. And that that is the advantage to a a campaign like Cashback. Who I like those. And we don't see them a ton when they we know they're valuable. Um certainly lots of different sectors verticals on Shopify. You know, you could you get somebody selling yoga leggings and somebody else selling diesel truck parts. I got clients who do both. Are there specific verticals where these kinds of campaigns work better, where you see more success, or you're like, look, my algorithm's smarter than everybody, and it'll just nail it?
Speaker 2
When uh when we started the product uh and when we did the first couple of months, we saw some sectors, some segments of the market reacting better than others. Uh but as time evolved, uh we found that uh the product actually can work effectively for a variety of merchants across different types. And across also different sizes of m of of the merchants. Because we thought, hey, initially that this is this is a simple product Maybe it's only going to be relevant for the smallest of merchants. But we see that merchants of all shapes and sizes are using the product. Some start advertising journey at shop campaigns. And some use it as uh part of their marketing spend, uh effectively de-risking, making it very predictable. uh but having a pocket in their budget that acts like that so they can afford some additional risk somewhere else. Um uh so yeah we are probably smart enough to make this work right now on for many different types of merchants. And in particular, I think with uh binning back the customers. Uh this is going to be very, very useful uh for merchants where purchases are less frequent in nature, where there's a bit of a gap between making a purchase and then coming back and making that purchase again. where it's harder to retain that customer. And and this is where we will be able to to to help bring that customer back. And to increase overall from being a platform that drives new customer acquisition to a product that actually helps to cultivate lasting customer loyalty.
Kurt Elster
On the with our our net new customer campaigns, we're trying to bring new customers to the store.
Speaker 2
Yeah.
Kurt Elster
Those were billed on against our um Against net new customers. What's your your metric for success, your KPI for the the win back campaigns? Sorry, I know you're not calling them win back, but I forgot the term we used.
Speaker 2
Yeah, we are customers. Yes, exactly. Um so uh this is something that um Uh I think still goes back to the simplicity of the product, simplicity of shock and pains. We want to make sure that uh merchants get the thing of the right price, the price that they they actually set themselves. So it's very important that we're able to uh deliver uh things in a predictable manner and risk-free manner. And also to get as much volume without exceeding the budget that merchants uh says in those cases. And we expect merchants to uh probably invest slightly lower price per returning buyer because they often already paid for that buyer initially. and expects a somewhat higher return at spend. But again, the success of this is making sure that the product stays as simple as possible. It delivers on its risk-free nature. and is able to generate uh volume to the merchant base that has this need.
Kurt Elster
I want to get started with it. What's our availability? Can I use this now?
Speaker 2
Uh we are we are launching the merchant uh side uh of the product on October 8th. Um and uh the We are going to use a few days to make sure that we have uh initial set of campaigns and we're going to open up uh this to the buyer side. uh a few days later from from there. So mid-October, this this is going to be live across the board, and this is where everyone can not only set up the campaigns but start getting value from it. We we really, really wanted to make sure that this product is live for BFCM.
Kurt Elster
I was gonna say that's that's why we're talking now. I mean Q4 just started and We've got um Black Fridays later in the year this year. I there's and this sounds easy to set up. Like if I jumped into if I already had a Shopify store and I jumped into shop campaigns, it sounds like I could be running this thing same day or you know within an hour.
Speaker 2
Yeah, it's so easy to set up. I it's not it's not something where you need to work hard to Come up with the creative, come up with uh some super smart targeting strategy, uh think about pricing too much, uh uh where you need to translate like a cost per click into like the actual price that matters to you and so on. Uh so the amount of time that you need to set up, the amount of time you need to maintain this is very small. The lift needed is very small
Kurt Elster
And where do I go to learn more? Like or in my my Shopify admin, how do I get it going?
Speaker 2
Yeah, you just go you just go to the shop channel. Most of the merchants have the channel or you need to install the channel if you don't have it. And uh and you're going to see campaigns in the shop channel. And uh and it's very easy to go from there.
Kurt Elster
That's cool. Ugh and thrilled to have easy Shopify specific alternatives to my PPC traditional PPC campaigns. It's I mean hearing it like, oh we could acquire top of funnel, we could acquire bottom of funnel. That is such a relief. You know I'm thrilled to try it. I've got we've got a few clients who are using the net new version of of Shop Campaigns. We've not I've not seen this new one in action. At as of the time we're recording this, it's not available for us yet. Um otherwise, for sure, we would have tried it. But we have seen success, and to your credit, we've we've seen it get progressively better over time. to where it's like, oh, that that's a thing everybody should probably try at least once. It like you said, dip your toe and see what it does. Um and from there, you know, uh, maybe These laps customer campaigns might be worth a shot too when that becomes available shortly. Oh, just phenomenal. Andreas, thank you so much. Are are how proud are you of of building this?
Speaker 2
Very very proud. And this is this is a great job from a pretty sizable team that is working behind us. And it's been in the making for for a bit. we were always looking forward uh to this moment in time and we make this not like a one point product but but like something that is more. And I think we're ready now. And I'm very, very excited about this actually going live. Um so please do try the product. And but many customer acquisition products, there's always first move advantage. Like where hey, the first people who come on this and who try this uh are usually reaping outsized benefits.
Kurt Elster
So that's a good point. Yeah, if you start on day one You're competing in a in a much smaller pool with other advertisers. That's pretty good. That sounds sounds like there's some advantage to getting started early.
Speaker 2
Yeah, so this is this is the little secret that we kept behind wraps in the run over for BFCM and now now it's uh out of out of the box. So yeah, last last thing that you can enable uh before all the rush.
Kurt Elster
Is there a website I could go to like shopify. com slash
Speaker 2
Yeah, you definitely can go to shopplay. com and uh and campaigns will be prominent there. Uh I'm sure you can type into Google as well, just shop campaigns and and uh our lying page is going to be uh one of the first results. Um and uh we also do have a good overview video on YouTube uh on shock and baits.
Kurt Elster
Andreas, thank you so much. And uh shop campaigns, a a Q4 pre-BFCM win to check out. We'll be we'll be on the lookout for it. Thank you. Thank you so much. Yeah, thanks. Ever wake up to customers canceling orders? Maybe they said, I shouldn't shop when I'm high. This was a gift we broke up. Those are all real customer quotes, and they're all a real hassle for your customer and you. Why should the customer have to ask you? Th to edit their order for them. What if they could do it themselves? Enter Cleverific. With Cleverific, you can empower your customers to make their own changes. Through a self-service portal. Cleverific is designed to reduce customer support tickets, ship orders faster, and even reduce returns and lost packages. Don't just take our word for it. Menswear retailer Peter Manning New York cut their order support queries by 90%. 49% with Cleverific. And they're not alone. Exclusively for listeners of the unofficial Shopify podcast. Get 50% off Cleverific's Pro Plan. Now just $49 a month. giving you full access to everything Cleverific has to offer. Just go to cleverific. com slash unofficial and use the promo code Kurt50, that's K-R-U-T-50, at checkout to claim your discount. Take control with Cleverific and watch your customer support tickets plummet. Shipping speeds increase and package returns decrease. And all of that means happier customers. Alright I have a headful of shop campaign knowledge now from the man leading the charge of that project. And now we gotta find out if it's true. We have here two gentlemen who have worked with shop campaigns who are E-commerce brand managers, who are operators, who are out there in the wild with shop campaigns, and they're going to tell us about our experience. So joining us now is Nathan O'Nean from Mellon. And Nick Daniels from Olakai. Gentlemen, welcome. Thanks for joining me.
Speaker 3
Thanks for having us.
Kurt Elster
All right, let's start with, I want to know about these brands, Melon and Olikai. What you do, what you sell, because you've been around in shop by a while. These sites look great. No, I will not pick a favorite. Stop asking. Uh, but all right, we'll start. Nick, tell me about uh Olikai.
Speaker 3
Yeah, so Olkai was founded in 2005 and our goal is to get out and create the best footwear for the island lifestyle. So the environment. We are a B Corp, certified B Corporation, so we give back a lot to Hawaii people, culture, and place.
Kurt Elster
And are you located in Hawaii while I suffer in Chicago?
Speaker 3
Unfortunately not, yeah. We're uh we kind of have a split office thing going on, a little bit in Hawaii, but mostly based down in Irvine.
Kurt Elster
Okay, good. That makes me feel better about being in the Midwest. And uh all right, Nathan, how about Mellon?
Speaker 4
So Mellon was founded back in twenty thirteen. Um, we're a premium headwear brand known for hard quality, meticulously crafted hats that combine performance, comfort, and style
Kurt Elster
And it is again, I mean, these are two seriously good looking Shopify stores. Yeah. We'll start with Nathan. What How did you start using shop campaigns?
Speaker 4
Yeah, so it's a good question. We um at Mellon were always looking for ways to acquire new customers. And actually as a personal shop user of the shop app, I had started to um you know explore a little bit and I found the model and uh found it to be really appealing. So kind of just went from there.
Kurt Elster
The it tell me about that model. It's cash back campaigns or shop shop cash.
Speaker 3
Correct. Yep.
Kurt Elster
Okay. Uh and Nick, how about yourself?
Speaker 3
Yeah, so me and Nate work pretty closely together. So uh kind of in the same boat, always looking for kind of new technologies or platforms to really help us acquire new customers. And ideally we find one that helps bring down our kind of blended customer acquisition costs. And we're really lucky to one, have Nate kind of give us a little insider scoop early, but two. see the results we're looking for with, you know, helping acquire a customer that and lowering our blended cacks.
Kurt Elster
And I assume, Nate, that you You went to Nick and said, I got this thing you gotta try. Like is the but he's like, Yeah, yeah, the inside track. That's how that conversation went. You're like, you won't believe it.
Speaker 4
Exactly. We're always kind of sharing tips and tricks and initial tell me about that.
Kurt Elster
that initial experience with shop campaigns. Like when you started out with it, you're dipping your toe in the water. Like what were the expectations or goals here?
Speaker 4
From a performance standpoint, that's how we approach all new media channels. Um, you know, we go to we go into it from an efficiency standpoint. And uh especially as we're looking to acquire new customers. So we've got our business KPIs set. Um definitely looking at our CAC, our OAS, et cetera. And um, and so we went into it knowing kind of what our goals were. And shop, you know, super or shop campaigns, super simple, easy way to um set up. It was a natural evolution for us. Um they've allowed us to reach new customers across their growing ecosystem. And um, you know, since we started kind of our advertising journey on job campaigns back in 23, they've quickly become one of our more essential channels for revenue and new customer acquisition.
Kurt Elster
The the phrase I heard quite a few times with talking about um shop campaigns, as they have been until this this upcoming feature launch that we'll talk to, is you're really it's top of funnel, you're gaining n what they describe as net new customers.
Speaker 4
Yeah, correct.
Kurt Elster
Did it work? Do you acquire net new customers?
Speaker 4
Yes, sir. We've got some we've got some good data to share.
Kurt Elster
Oh, oh, oh, the okay, gentlemen, let's hear it. How did this perform? What are what are the results for music shop campaigns?
Speaker 3
Yeah, it's been super, super solid from a customer acquisition perspective. It's quickly moved into Olikai's number three advertising channel. Uh year to date, we're seeing a 2. 5 ROAS and our CPAs are around $47, which is uh definitely where we like to see them from an uh Olekai perspective. And then uh yeah, the mirror kind of like what Nate was saying prior is like we were testing uh testing kind of at a lower CPA, kind of like thinking about it as kind of a Google, but we quickly realized that we're actually bringing in um more like top of funnel and we're seeing 93% of orders coming through or like almost a hundred percent of all of our orders coming through are new. brand new, net new to the to the uh to the list, which is great. Um so yeah it's been it's been awesome for customer acquisition for sure.
Kurt Elster
So This is I want to make clear here. This is tofu, a top of funnel campaign. So we are put getting new customers in who have never experienced the brand before. This is entirely new to them. And you're still able to get that's the hardest audience to reach. And so you're and you're still getting a two and a half X row as on that. Correct. That's awesome.
Speaker 4
That's good. Okay. Yeah, from from the Mellon side, I mean very similar to Ulikai, um, shop campaigns have have grown. They've become our number three performance channel. um since since we've been using them so definitely investing heavily into campaigns. Um ten percent of our new customers that we're acquiring have been driven by shop campaigns. And we'll use this to scale during holiday periods as well as like shop-led promotional moments like shop day, which they do annually, which is Really cool and a big moment for us to acquire new customers.
Kurt Elster
So tell me about Shop Day.
Speaker 4
Yeah, Shop Day, it's it's one day a year, and I should know a little bit more about it, but it's one day a year. where they incentivize the the community with some shot cash and during that day we see a host of new customers acquired. So it's um Yeah, hate to you hate to use in it as a uh comparison, but it's like the prime day of shop.
Kurt Elster
The I'm fine with the comparisons. I think it's great shorthand to make these things easy to understand and remember. Um, investors of course hate that stuff, but that's not why we're here. The uh well the other thing it sounded like is that it's it's easy to use. You know, typically PPC campaigns, setting them up, they are technical, granular, painful. I don't love doing it. The but the way shop campaigns has been described to me is that it is super simple. What was your experience? Easy, moderate, what do we think? Because you guys are pros.
Speaker 4
Yeah, yeah. I mean, much like Shopify in general, like requires little effort to set up and manage. Um, you know, we're constantly evaluating each channel's success and we'll push pull budgets, but um it's it was super easy to set up and and maintain.
Speaker 3
Yeah, I definitely agree with Nate there. We're like we can, you know, shut off a campaign and get one back up, move in immediate, like within 30 seconds. There's no creative that you have to be really working with, which is a huge uh lift off of our creative teams back um and we're able to move nimbly and quickly.
Kurt Elster
So in the In the app itself, like what what is surfaced, what is shown to the customer? What's the the ad or offer look like?
Speaker 3
Yeah, so it depends on your CPA target, but basically you're shown a multiplier on your shop cache that you have. So as a brand, you set your CPA target, and then whatever shop cache they have, It will multiply up to that CPA target that the brand has. So you get that dollar off basically on that new order.
Kurt Elster
How fitting this, like you you test it, it works, it's easy to use. Is there any issues, special consideration with integrating it? Because you said this is your number three channel, with integrating this into the general marketing funnel. I assume that None, but I think it's worth asking.
Speaker 4
Yeah, definitely. I mean, no um short answer. Um, you know, basically we're evaluating, like I said, our our budgets on, you know, daily, weekly, monthly basis and as soon as we see a performant channel, we're starting to invest there. And then it quickly rises in the ranks across other channels and we're pushing polling budgets daily. So um it really seamless integration into our overall marketing mix and um it's just been a great channel for us.
Kurt Elster
And with this this upcoming new audience targeting feature, where we're able to get lapsed customers to come back to the store with similar offers. Was this feature in beta? Have you seen this?
Speaker 4
We've heard. But um haven't been able to test it yet, but definitely part of our plan to test once it's been rolled out.
Kurt Elster
So you're this for sure this is on your radar and you anticipate including this in your strategy.
Speaker 3
Yeah, definitely. At least on the melon side Yeah, on the Olakai side we can see definite opportunity to utilize it for win back. And then something that we've been thinking a lot about on our side is How quickly can we get first-time buyers to second time purchase? As we know, if we can do that within 30 days, it excl it like exponentially increases the chance of them becoming a high LTV customer. So There's a really unique uh place here for shop cash in that particular manner to utilize that as a strategy.
Kurt Elster
So you're you're familiar with it, you're excited about it, you're ready to go.
Speaker 3
Yeah, and I'm sure it'll take only like 30 seconds to set up, just like the other one.
Kurt Elster
It sounded like that. When it was described to me, I'm like, there no way. But it seems to be the case. It's like it really is as easy as it's it's been described in works. Um so if I think it it it's a fairly new thing. You know, people are not If they're may not be aware of it, and now they are aware of it, but they're like, you know, maybe it's not right for me. Uh I'm curious. I don't know. Help me sell these folks into into trying it. Like what advice would you give to another Shopify store, brand, owner, operator that's considering using shop campaigns?
Speaker 3
Go for it. Yeah, go for it. It's the easiest customer acquisition channel that I've ever seen. Um as far as like setup goes, the orders flow in naturally into your And your back end, there's no issue. Obviously, if you're on Shopify getting the order file or anything to have to be manipulated there. It's just it's so seamless, really.
Speaker 4
Yeah, I'd say if there's any consideration of a new channel in your your media mix, campaigns have been such a powerful tool for us for both um customer acquisition and and revenue in general and um you know partnering with Shopify they've they've proven to be an excellent partner and you know continuing to roll out new things these these betas with the remarketing Um so it's it's been a cool opportunity.
Kurt Elster
I would I definitely agree with that sentiment. I feel I feel the the love. It's good. With something like Shop Campaign, you know, comes on the scene. You're already a Shopify merchant. If you're a Shopify merchant, you are familiar with PPC advertising, most likely. And Now you've got this thing that is practically built into your Shopify admin that helps you reach new customers, that helps you win back customers, that operates like um paid digital advertising. And it's incredibly easy to use. So with a tool like this out there, as it grows, my hope is this changes the landscape, right? If Shopify's out there going, hey, we built this thing that is super easy to use, and then that starts eating into the budget of other marketing services that are just flat out painful to get going with. Do do we think this changes the landscape and then those tools suddenly have to get easier? Or am I is that wishful thinking on my part?
Speaker 3
I mean, it would be amazing if everything could move to a CPA model because it basically just pr The company believes so much in their product that they're gonna get you orders and the fact that Shopify can do that and it's proving itself is so powerful. Now You have the metas of the world and the Googles of the World that you could spend, if you don't know what you're doing, so thousands and thousands of dollars and not see an order come through. I think this does democratize uh advertising, really, uh, for like digital first companies that are on Shopify in particular.
Speaker 4
Yeah, I agree with Nim. I mean the simplicity of that that CPA based model makes it really quick and easy to get started. I know that's been said, Ignazium and in this um so far, but you know, as as a business, as most businesses are, mindful of efficiency, it allows you to, you know, set your targets. Um and and get up and running quickly and also be, you know, extremely efficient.
Kurt Elster
He said, you know, when this comes out, when the this new feature comes out, it day one, that will be the best time to get started. because the algorithm is serving the fewest number of merchants. And then obviously over time it it it expands. More people are going to hear about this and it will grow. And so you are you have an advantage by being early and trying this thing out on day one and getting going with it. Alright, so I assume that like as soon as it's available, you guys are gonna attempt it.
Speaker 4
I mean get while they getin''s good. That's that's what you just said, right?
Kurt Elster
Make hay while the sun shines.
Speaker 4
Yeah, yeah, exactly. So yeah, excited about um uh testing it out. I think it has a a place in our uh our marketing strategy overall and excited to see what they've built into it.
Kurt Elster
Excellent. Anything else I should ask?
Speaker 3
Make sure you activate your shop campaign before Q4. Get it while it is Q4. I know, true. Black Friday, Silver Monday is coming, so
Kurt Elster
It is. It's so close. It's gonna be here before you know it. So now's the time. Get in place. And you know, you want especially like You want to be building those remarketing campaigns now before your CPMs go way up as we get closer and closer to, you know, the big event. Yeah. The early bird gets the worm when we're we're prepped for Black Friday. And this is just another another quiver in your bow.
Speaker 4
Yeah, the early birds over on uh show campaigns right now.
Kurt Elster
Absolutely. Okay. Melon and Olekai, tell me uh what are the pit pitch me on this. I want to get I want people to visit the site because they're they're really good.
Speaker 3
Yeah, definitely. You can visit Olikai. com if you're in the US, Olikai Canada, or Olikai. ca if you're in Canada. You can check us out on the shop app if you have that downloaded. But yeah, we're uh Pretty easy to find. Olakaiol K A I dot com.
Kurt Elster
And I will of course include that in the show notes as well. And the other one, melon, not spelled like the fruit.
Speaker 4
Not spelled like the fruit, melon, M-E-L-I-N. You can find us over at melon. com.
Kurt Elster
Um Is melon a fruit or a vegetable? Oh, it is a fruit. Okay, good. Good. I googled it. Uh the yeah, I'll put that stuff in the show notes and you know check out check out Olikai, check out Melon. Uh and but certainly don't sleep on shop campaigns because I think there's it's quite an opportunity that a lot of us, myself included, missed out on for the last year when we could have been using it. So then yeah, yeah, a little little regret there. I wish I'd started sooner with it. But Now, my tune has changed. I'm starting now.
Speaker 4
Yeah, no time like the present.
Kurt Elster
No time like the present. Nathan, Nick, thank you so much for sharing your experience.
Speaker 4
It's been a pleasure, Kurt. Yeah, thank you, Kurt.
Kurt Elster
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