Performance Marketing Trends in Ecommerce, with Marin Istvanic

Today we’re talking about new trends in performance marketing. Simply put, performance marketing is advertising that can be measured in real time, so that means Google Ads, Facebook, Instagram – anything that gives you quick information that allows you to make the right decisions for spending your marketing dollars. Spending money effectively is imperative to success in Ecommerce, and we have one of the best to tell us how – Marin Istvanic from Inspire Brands Group.

This episode of Deal Closers is hosted by Izach Porter, brought to you by WebsiteClosers.com, and is produced by Earfluence.

Transcript

Marin Istvanic: Marketing is kind of like selling a story. So basically you have to kind of like get people to identify, kind of like poke their pain point. Then kind of present the solution, present unique mechanism of your product, and then show the benefits. 

Izach Porter: All right, you’re listening to the Deal Closers podcast, brought to you by websiteclosers.com, a show about how to build your e-commerce business to be profitable, scalable, and one day even sellable. I’m Izach Porter and on the show today I want to talk about new trends in performance marketing.

Simply put, performance marketing is advertising that can be measured in real time, so that means Google Ads, Facebook, Instagram, anything that gives you quick information that allows you to make the right decisions for spending your marketing dollars. I recently, was at a presentation, and mastermind group where I heard Marin Istavanic from Inspire Brands Group at the conference, and he was talking about this exact topic. So I wanted to bring him on the show and of him share a little bit of his expertise in this area with our audience.

Hey Marin, how you doing today? What’s going on?

Marin: Pretty good. Glad to be here.

Izach: Yeah. Yeah. Thanks. Appreciate you coming on. So I gave like a, super simplified explanation of what performance marketing is. But what does that term mean to you and, you know, how are you using it to help your clients right now?

Marin: So basically the benefits of digital marketing, of performance marketing is that everything is measurable. So basically our goal is to maximize the efficiency, maximize the return on the investment, based on our ads. So basically whether client has a target that for each dollar put in, he wants like two back or he wants five back, we, we kind of like try to maximize that.

What’s cool about Performance Marketing is you can actually track everything. You can check how many people saw your ad, how many people clicked on your ad, how many people out of those ended up on your product page, how many out of those added to cart, how many those initiated checkout, how many ended up buying?

Basically, you have all funnel spread up and you can see where the gaps is. It’s totally different compared to a billboard where you put a billboard, I don’t know, in a city, like you don’t know what effect it has. Performance marketing is amazing because everything is measurable and you can easily scale it.

You cannot just like put 50 new billboards and expect the same results. So basically with performance mark marketing, in my case with Facebook ads, you have more control in terms of the targeting. You have more control in terms of the messaging. You have more control; how do audience resonate? You can test multiple stuff.

And what’s kind of like the most important? You can actually see what are the results that their ads are generating.

Izach: All right. So I want to, I wanna break that down a little bit, Marin. What are some of the new trends that you’re seeing? Where are the areas where you’re seeing the best returns? And are there any like, tricks of the trade that you can share that someone who’s listening to show might be able to implement themselves.

Marin: Yeah, so there are definitely many tips and tricks, to be honest, not so much as before the iOS update, because that kind of like limited Facebook ability to find a potential customer, like two, two years ago, you could just kind of like plug simple image and like put some money behind it and like everybody were generating, were generating money through Facebook. Now, after the iOS things changed. 

So you have to be more specific. Like I would say that great marketers survived, but, kind of like people that were only good media buyers, they are struggling at the moment. Cause the attention switch from like media bank tactics to more messaging angles, doing research, actually creating funnels based on, different angles, different messaging. kind of like trying to actually find out what are, what are some kind of like psychological tricks to get people to buy, to lead them to your funnel, to showcase them different messaging, whether, where in their funnel they are, because it doesn’t make much sense to talk about benefits of your product to someone who doesn’t even know it has a problem.

That’s kind of like from the marketing standpoint, from the technical standpoint. In terms of the Facebook ads, one of the most exciting features that Facebook introduced, I think it was like six months ago, is Advantage Shopping Plus Campaign, which is kind of like relying more on the ai, to be honest.

Like how does it work? Nobody knows. Facebook did not share, too much details about it. It’s kind of like a black box, but currently it’s outperforming like everything else in like, I would say 80% of my, campaigns.

Izach: Okay. So, you know, we, we’ve had a lot of clients that were impacted after iOS 15 in terms of the, the ability to attribute sales and, and track, and we’ve seen return on ad spend go down, you know, in particular with Facebook. So does this new feature, is it a substitute for that or kind of, is it, is it getting us back to the same level of return that that we saw before iOS 15?

Marin: So like, to be honest, I don’t think that like, like Facebook struggled so much in terms of the delivering performance, the iOS cause like the only thing that changed is the number that Facebook is reporting in their dashboard, in their ads manager. But if you check the revenue numbers, things are still looking pretty good on the Shopify level, on kind of like in the back end.

So it means sales are still coming through, but they were not so much visible in Facebook, so people had kind of like, to resort to other solution to kind of like track for those changes. So potentially they would decrease the budget all because they thought like Facebook is not performing. So basically what I would say that who got hit most are kind of like small niche businesses that didn’t have like much data. They were depending on like a super small group of people that are their potential customer.

In terms of the Advantage Shopping Plus, it does not kind of like show you more sales than all the other campaigns. It just performs better. But to be honest, like Facebook kind of like worked in backend on improving their tracking. So basically things are looking, a bit better compared to the year and a half ago, two years when iOS 14.5, started.

Izach: So Marin, can you tell us a little bit about Inspire brands and, and what, what you’re doing with your clients and what type of clients you’re working with?

Marin: Yeah, so I currently work as a head of performance in this, at Inspire. I started as a freelancer seven years ago, connected with Matt, who is a Inspire Brands founder of the agency. but like soon I work my way like to the senior media buyer now, currently head of performance and, co-partner at the, at the agency.

We are a boutique agency focused on paid social. so basically Facebook adds our, our bread and butter. we are a boutique for a singular reason because we don’t want to kind of like quality drops down because with kind of like scaling, you have more people, the quality drops down. So we don’t want to be kind of like another sausage factory.

So basically we were, we are working with just a handful of clients. A majority, like I would say 100% of our clients are from E-comm and 90% out of those are Shopify stores. so basically we are working with, the brands that already have like proven market fit that are looking to scale their business, that they understand like how whole marketing channel works, how like, channels are working. One with other, not one against each other. So basically people that they know Facebook can take their business to the next level, and we are there to kind of like, provide that service of Facebook media buying. 

We also have experience of scaling our own stores because we have two internal stores. We have two stores that we, that my co-founder exited. So basically we have experience of scaling a store. So that, that’s kind of like how we started. We started as kind of like building brands, but we noticed we are pretty good in Facebook ads. So we started like offering that service to other people.

Izach: So when you think about performance marketing what gets you excited, right? Right. Now, what are you, what are you excited about that you’re doing currently, and what do you, what do you see kind of coming down the road with advances in AI and, and new tools?

Marin: So to be honest, if you asked me the same question like year, year and a half ago when we were kind of in the middle of iOS, I would say like, Okay, this is looking terrible. I don’t know what would happen. Like things are not looking good. Like lot of the lot of the stores had kind of like drop potentially in Facebook results in revenue.

So I was like very pessimistic. But kind of like Facebook introduced some of the cool feature that we did not have for a year and a half ago. So basically they introduce a feature to compare attribution videos to basically see whether your results are coming from a click basis or from a view basis.

That’s pretty, kind of like crucial to understand, effectiveness of your ads. We also got ability to check the breakdowns. So basically you can see, from which age, from which gender, from which country your customers are coming, so you can double down on that. So it doesn’t look gloomy like. as I mentioned already, Advantage Shopping Plus is kind of like one of the best feature that Facebook added in five years ago. 

Regarding the ai, it does certainly kind of like, looks interesting in this, in this space, especially in cutting down on some time regarding the research, kind of like finding what’s the exact, reason and what are some potential, angles people can, help you, people can buy from. At this point, I don’t think that AI is something that is gonna, like, replace people.

It’s good enough for ideation to go like from zero to one, but then you still need kind of like good copywriter, good creative strategies, good media buyer to iterate on that to kind of like, some, add some extra things that can take you to the next level that can actually be delivered to the potential customer.

Izach: So when, when I saw you speak at, at Alex Fetodoff’s mastermind, you, you had some examples that kind of blew my mind of, of what you were doing and the level of analytics that you were using to make decisions. Give us a few examples of, of like some success stories you had. I, I know, there’s a case study on your website, you know, with one of your accounts where you spent, I think 20 million in ad spend in, in, in a month and, or maybe it was in 12 months. You know, give us some, some examples and some success stories that stick out to you.

Marin: Yeah, so that’s definitely one of the, not one of the biggest, but definitely the biggest success story for us. that we managed to spend, 20 mil in one ad account in one country. That is not us. And we kind of like managed to, like, from those 20, we managed to generate 140 mil. that was in 2021.

Izach: That’s a seven, a 7x return.

Marin: 7x. Yeah.

Izach: that that is off the charts. Yeah.

Marin: Yeah. To be honest, like it’s not only me from Facebook. The product was great. The time for the kind of like product was great cuz we kind of like hit, hit, like we were in the middle of Covid and the product was something that’s used at home. So basically there were like lot of factors that come, to kind of like success of the Facebook ads.

But yeah, we kind of like amplify that with the Facebook ads. it’s basically just like putting a fuel on fire. To be honest, like in terms of the performance, and the setup things are, were not so complicated. So basically when you have an ad, there are a couple of ways, you can kind of like iterate on that ad, find some potential new audiences, go with the manual bids to maximize deficiency on a certain days.

We had some days that we spent, I don’t know, 20k we had some the days that we spent over 100. It kind of like, also like during the weekend, we know that efficiency is better, so we kind of like push more budget there. we kind of like leverage some of the best angles and iterate on that.

We kind of like found out that thumbnail is what actually drives the performance of the ad. So we kind of like continue to double down on the winning angles. On the, sorry, on the winning thumbnails, like close up of a product or like, Product with the, with the X sign. Kind of like that introduces the problem at the first second that kind of like acts subconsciously to the people.

So basically those are some kind of like tips and tricks that allow us to maximize the efficiency, of the ad.

Izach: Go, go back to that cuz that, that, that is I think a, a, an idea that even a, a new seller can implement Right, with, with images. So just can you just ex explain what you’re talking about a little bit more with the, with the product image in the X?

Marin: So basically we found out that for whatever reason, Facebook is favoring the ad with a certain thumbnail style. So basically all the thumbnail is visible in the video for only like fraction of the second, especially on people that are watching the video on auto play on Facebook. For some reasons, either the users or Facebook is favoring certain patterns of a thumbnail.

So we found out that like when you have a closeup of a product, that kind of like that works pretty great. We found out that you, when you have a, closeup of a face of a person’s face, especially if your like person in the video is your target customer demographic. So if you’re selling to, I Don’t know, women that are 40 to 50 years old that are into, into anti-aging. So if you close up her face, it subconsciously kind of like gets people, gets kind of like those prospect to identify. 

Marketing is kind of like selling a story. So basically you have to kind of like identify, get people to identify, kind of like poke their pain point. Then kind of present the solution, present unique mechanism of your product, and then show the benefits. So we found out when we kind of like present the problem, so let’s say if a like person has a hump on their back and they have some kind of like problem they like because they kind of like, I don’t know, work too much, or they stand, they sit at a desk for too, too much time, so their back hurts.

So we kind of like put an image of, of a person with a hump on their back, and then we put an X sign at the corner. Big, big red X sign. So basically people kind of like identify, okay, this is something that’s not good because X sign is kind of like presented with, connected often to a kind of like unpleasant situation.

So kind of like that again work subconsciously. Basically we had the same video tested with the multiple different thumbnails and in every single test in, in that account and all the other red accounts where we have a product that is resolving some problem, that thumbnails style, worked pretty great.

And as you mentioned, we actually found out that because we had an image, static, With, kind of like that X sign that was working pretty great. So we started introducing that as a thumbnail and it worked like a charm.

Izach: Hmm. I love, I love that because it’s, you know, it’s, that is not country specific, that, that concept, right. It’s, it’s not language specific. You know, if you’re starting out as a brand-new seller and you’ve got a product that solves a problem, you can, you could try that strategy out early on day one if you wanted to. 

What are kind of the three or four most important data points that you watch that, that someone who’s maybe a new seller or that’s just starting to scale their, their brand should be, should be paying attention to?

Marin: So in like in terms of the ads, there are a couple of concepts that we know are kind of like. like working on, on majority of the other accounts. So I would say like definitely UGC, user generated content. So people like to see that other person already had success with that product. So whether it is unboxing, whether it is a testimonial video, whether it is kind of like product demonstration video in which you are explaining, those are kind of like the concept that are working pretty great.

In terms of the ad like static ads, I would say split screen. So basically you have like your product on one side, the competitive products on other side, and you highlight your benefits or your features of product that are kind of like, better than the competitors. as I already mentioned, closeup of a product and stuff like that.

In terms of the data that I check, definitely, most important is return on the investment. people are considering, there’s kind of like some brands that are running multiple channels, so like, say, say Facebook, Google, TikTok. So let’s say you, you could have each platform claiming that it got a sale. So you could have like TikTok claiming the sale, Facebook claiming the sale, Google claiming the sale.

But when you check in Shopify, there’s only one sale happen, because person had like multiple touchpoints. So instead like increasing the budget on all three channels, that could result in kind of like to high budget, you try to make decisions on a blended basis. So you take all the spend from all the channels and revenue. and then you have a target that is kind of like your target. 

So we call that MER, Marketing Efficiency Ratio, or blended draw. So that kind of like helps you to understand whether your business in general is in a good position. When we are talking about the Facebook, then obviously platform specific for us is something that is kind of our main metric. Then after that it goes to new customer cost per acquisition. So basically you could have a lot of people that are coming to your Shopify stores because they’re on your, on your subscription list, or they’re kind of like, buying after you send them an email because they already bought from you.

But if you rely too much on those, you would kind of like left out of all the prospecting, people that are potentially buying to from you. So basically you want to check how many new customers are you getting on a daily or weekly basis. After that in terms of the ad performance, obviously we are looking at click through rate as one of the most important metrics for the videos.

We are looking at some custom metrics, so basically hook rate, which tells us how many people, out of how many people that ad was served, they watched at least three seconds. So that tells us how interesting the video start is. After that, we look at the hold rate, which tells us how many people watched at least 75 Percent of the video after people that watched three second of the video. 

So basically how long the retention rate, the curve of the video is, then we, we can identify, okay, this ad had like amazing thumb stop ratio, so we got people hooked, but they’re dropping off. So obviously we have to improve in the middle of the video to get them to watch, more of the video.

Izach: Awesome. Yeah, that’s really great, and then what about converting? So the, for the people that that stay on and watch 75% or more, you know, how are you tracking who actually transacts.

Marin: So then we obviously, because as I, as I mentioned at the start, we have kind of like all the metrics in the funnel laid out. So basically we have how many people start watching the video, how many people watch certain percentage of the video, how many people clicked? When they clicked, how many people proceeded to the product page?

How many people added to cart? So we have our targets per co, let’s say cost per cart. So, you know, let’s say if I want to be profitable, I need to get my cost per cart for, I don’t know, 20 bucks. If I’m seeing that I’m getting my cost per cart on average for, I don’t know, 35, that that is like hardly gonna be profitable.

Then we have conversion rate and the AOV, because ROAS is, kind of like dependent on the amount of traffic that you are driving to the website. how many people are actually buying, which is your conversion rate, and to the what amount they are buying, which is AOV. Obviously those are kind of like, very as higher the AOV deliver the conversion rate.

So you want to find that sweet spot where your conversion rate is pretty good for the amount of AOV that you are, selling. So you can actually be profitable. So that’s why we potentially introduce bundles that we kind of like combine best-selling product and the product that’s not so kind of like appealing to the people, but you make a no-brainer offer that you say like, buy this and get this for free.

And potentially it looks like an amazing deal to the people and you are selling both product, you’re increasing your AOV. That allows you to have a, a higher CPA at the front.

Izach: Ah, it’s great. It’s such a great idea. Yeah, I love, I love these ideas and I love thinking about breaking down that whole funnel into, into data that you can track and then use to improve your, your overall efficiency. It’s really smart. 

love the

Marin: In my opinion, that’s the, that’s the only way to go cuz like just iterating on the stuff and like, Hey, let’s try this, let’s try this. Like it doesn’t make sense unless you are kind of like actually measuring and seeing where the biggest gap is and then trying to like close that gap.

Izach: So you’ve been doing this for a long time. Have you had any mentors that have, have kind of helped you get up the learning curve? Are you self-taught? Are there courses out there that you recommend?

Marin: So, yeah, like when I started like there was not much kind of like literature about Facebook ad, at like least in Croatia. So I started kind of like learning everything there is about it, like watching all the podcast, like listening to podcasts, watching YouTube videos. I went through the like whole Google literature support they had.  

Luckily I had one friend, I think he was like the only guy in, in Croatia that was doing Facebook ads at that time. So I started working with him, like asking him all the questions, like he had, he needed some help. I kind of like, it was amazing opportunity for me to actually spend other people money and not kind of like learn on my own.

  so I would say that he was one of my first mentor. Then with time, I got connected to kind of like community, like geek out, Nick Shackleford which I had kind of like couple of, consulting sessions with. And I could say that like he was, one of the guys that kind of like, paved the paths to, to my current situation in media buying world.

Izach: I guess a follow up to a few of these kind of concepts we’ve talked about. What are some challenges that someone, you know, who’s trying to improve their, the performance of their marketing campaigns? What, what are some common challenges that, that people face that you know, that can be overcome with, with this approach?

Marin: Yeah, so like people launch a couple of ads and they say like, Hey, Facebook has done this work for me. So like Facebook ads are only amplifier. They’re kind of like sharing on top. You have to have a product market fit. You have to have like healthy foundation of your potentially organic traffic. You have to have like good offer that is actually converting.

You have to have your pricing dialed in, and like when, when you are seeing some success, like, then you resort to Facebook ads, as I said, like it doesn’t make sense to kind of like create a product, launch a store and just like, Hey, we are gonna launch Facebook ads and I will get like five X ROAS.

So like, that’s not gonna happen. Like you have to have everything else styled, before you kind of, Start launching the ads. A lot of people are complaining about the tracking, recently, which kind of like makes sense since the iOS. we are kind of like partially blind, but as I said, that’s, that’s improving.

  we have a couple of like third party tracking software, like Nor Beam or Triple Whale or Converge, which are actually helping, with this situation, that are actually kind of like helping us with the optimization because, if you know how to optimize, you can actually maximize the efficiency, which is kind of like something I strive for when running Facebook ads.

Izach: Super cool man. So how, can people connect with you or Inspire Brands.

Marin: So probably the best ways to reach me, on Twitter, like on a daily basis. I’m sharing like. three to four tips and tricks re regarding the Facebook ads. I’m basically giving everything that I know, all my secret sauce. It’s a couple of, kind of like, simple tricks, but then I also broke down. how am I testing stuff?

How am I, setting up my retargeting? How am I actually analyzing the data? Am I scaling? So basically, if you want to learn more about Facebook ads, check my Twitter. you can send me a dm. I have an open DM on Twitter, so if you are someone that’s interested in working with us, uh yeah, just reach me out on Twitter or you can check, our website, which is inspire brands group.com.

Izach: That was Marin Istavanic, who you can find at Inspire Digital Group. Thanks everyone for listening to this episode of the Deal Closers podcast, brought to you by websiteclosers.com. If you like the show, be sure to rate us write a review, press the follow button and share it with your network.

And of course, if you’re looking for help selling your e-commerce business, be sure to visit websiteclosers.com. This episode was edited and produced by Earfluence. I’m Izach Porter. Follow me on LinkedIn and we’ll see you next time on the Deal Closers podcast.