Ecommerce In Uncertain Times | Raul Galera

Matt Edmundson [0:05 - 2:27]: Well, hello and welcome to the Ecommerce Podcast with me, your host, Matt Edmundson. Now, this is a show all about helping you deliver Ecommerce. Wow. And to help us do just that, we've got a special guest, someone who has been on the show before, Raul Galleria from Referral Candy. Now, Raul was on the podcast in 2021. We talked about referral marketing and if you've listened to that episode, you'll remember how good it was. So I'm really, really looking forward to this conversation and getting going again. Raul reached out to me a few weeks ago and said, matt, I've got some really interesting stuff. Can we chat about it? And I'm like, of course we can. Of course we can. And before we get into it, let me just say very warm welcome to you. Especially if this is your first time with us on the Ecommerce podcast, It' great to meet you. Do reach out to me on social media, Edmundson. You'll find me on LinkedIn, on Instagram. It'd be great to connect. Let me know what you're doing, Let me know about your business. I was just talking to a chap called Dylan earlier on today. Dylan, if you're listening, hope you're doing well. And we were chatting about his ecom business and he said to me he found the podcast in August, right. And bearing in mind the time of recording, this is October and he's already caught up. Right. And we've been on air five years. That's some going, not going to lie, some going. And I just have to apologize for the sheer amount of my voice in that time. But anyway, do reach out. Be great to hear from you, great to connect with you and of course, if you are a regular to the show, a warm welcome back. Now, let's talk about Raul. He is the chief advocate at Referral Candy, which is the go to app for E commerce brands looking to grow through customer referral programs. He has got over 10 years of experience. He's been a Referral candy a wee while, as we say, which has empowered 30,000 plus brands to turn their customers into a marketing force. Love that phrase. For the past five years, Raul has led partnership efforts connecting with marketing agencies, media and tech companies to boost growth without spending on ads. So, Raul, welcome to the show, man. Great to have you back. How are you doing today, good sir?

Raul Galera [2:27 - 2:30]: I'm doing pretty good. Thanks for having me again.

Matt Edmundson [2:30 - 3:05]: Oh, no worries. Always great to have you back on the show, man. Always great to talk to you. We were talking before we hit the record button I'm sort of slightly envious of the weather that you have where you are versus the weather that we have where I am. You need air conditioning, I need a heater. And it's amazing because we're only a few hours apart how just a few degrees on the old equator changes everything. But, you know, there it is. So it's been what we were saying. In fact we looked at the date. It was sometime late, late September, wasn't it? When you're on the show in 21, which is, it's almost like you said, the three year anniversary.

Raul Galera [3:05 - 3:06]: Yep.

Matt Edmundson [3:06 - 3:08]: So what's been going on the last three years?

Raul Galera [3:09 - 5:23]: A lot. Yeah, we talked end of 2021, which we were pretty much still at the peak of kind of like Covid fuel Ecommerce growth. You know, 2021 was still a year in which companies were getting, you know, crazy amounts of funding. Everyone in the space was, you know, growing with again just like cheap borrowing lots of money available for, for funding for DTC brands. So things were going pretty well for everybody, you could say in the Ecommerce world. 2022, we started to see a little bit of a, kind of like, you know, darker clouds in the horizon and that kind of materialized in 2023, I think, in which I was just talking to a few people a couple weeks ago about it and you know, I was saying how some brands in 2023 said that, you know, it was almost a flat year. And some of them said actually flat year being a flat year was almost like the, the positive scenario, you know, for, for a lot of brands, like if you were just flat on 2023, you know, you could, you know, pat yourself in the back and you know, it's like, good job. Right? You kind of, you made it. That being said, we had a lot of growth around the Black Friday and Cyber Monday mark last year. A lot of people say that it was, you know, fueled by, you know, kind of like buy now, pay later type of debt, that we don't know what's going to happen in the future. But I mean the numbers are there and you know, we're entering again since October 7th. Today we're heading into Black Friday Cyber Monday fairly soon. Brands are getting ready for that and there's always this, you know, there's like this big question of what's going to happen. It's going to be bigger than last year. How are the US Elections going to play out in all this? So yeah, one of the initiatives that we put together kind of because of all these unknowns that A lot of agencies are having. We put together this confidence report to try to shine some light on at least what other people are thinking and kind of like, what's the mood around Ecommerce agencies on a monthly basis.

Matt Edmundson [5:24 - 6:04]: Great. So just. It says here that the confidence report involves gathering data from around 100 agencies on a monthly basis. You guys are creating therefore a confidence index, which I just, I think is such a great phrase, and tracking trends in Ecommerce, such as how brands are spending on marketing, hiring agencies, versus in house, and much more. So you've been putting this confidence report together, which I really like the idea of, by the way. Thank you. The agencies that you're talking to, are they all marketing agencies? Are they a variety of agencies? What kind of agencies are we talking to here?

Raul Galera [6:04 - 7:07]: One thing that they all have in common is that they are Ecommerce focused. So I would say the majority of them are marketing agencies because there's a bunch of questions that are about marketing budgets. And so obviously they're the ones that I would say the vast majority of them have touched kind of marketing with their clients. Probably kind of like, I would say the main difference between all these agencies is how they attract customers. So I would say there's like two big groups of agencies, one of them that are just like pure, you know, marketing ads type of companies that focus on that or SEO, you know, kind of type of thing. But like they focus just 100% on marketing. And then the agencies that do like website builds or migrations or redesigns and then kind of keep that customer on retainer, typically with some other types of services that may include marketing or just maintenance or whatnot. But yeah, the one thing that they all have in common is that they're almost 100% focused on Ecommerce.

Matt Edmundson [7:07 - 7:11]: Yeah. Which is great. And are they worldwide or are they just focused in one particular area?

Raul Galera [7:11 - 7:41]: Yeah, I don't have the numbers for me right now, but I think it's like 50% US and Canada and then like, I think like 30% Europe and then the rest between Australia and Asia, Latin America. So I mean, it's kind of leaning a little more heavily on Europe and the US But I'm actually in the process right now kind of getting more agencies from Australia as well. So we can get kind of that side of the world as well. But yeah, I'm trying to keep it as open as possible.

Matt Edmundson [7:41 - 7:53]: Fantastic. And so your job then is you're growing this, you're getting more agencies on board. Just a quick pled. Then if you're listening to the show and you're an Ecommerce agency, then do reach out to Raul. How do they get hold of you?

Raul Galera [7:53 - 8:17]: Yeah, so I mean, they can find me on Twitter. I think my ad is raulgalera D. Or just search for roller referral candy. You'll find it. Otherwise, on our website we have the report and we have like a little call to action where you can, you know, if you want to be a partner agency, you can submit and says referralcounty.com EACI cool.

Matt Edmundson [8:17 - 8:18]: EACI.

Raul Galera [8:18 - 8:19]: Yeah.

Matt Edmundson [8:19 - 8:53]: We will of course link today in the show notes as well, which you can get along for free at the website ecommercepodcast.net and of course, if you're listening to this on your favorite podcast app, they'll be on that as well. Just scroll down and they'll be there and just click the links through to Raul. But so let's jump into it then. You know, you've got this confidence report. You're talking to e commerce agencies all over the world, all of whom Ecommerce commerce as clients, and they can see what their clients are doing, where they're spending and so on and so forth. At the time of recording, it's October. We've got Black Friday Cyber Monday coming up. Is that a big deal right now for agencies?

Raul Galera [8:53 - 11:01]: Yeah. And so I would say that that is probably what is driving most of the confidence in Ecommerce right now. Okay. So when we started the report last year, the first month that we did the, the first report that we put out was in January 2024. So we started doing research on. In December. And you know, with that, we, you know, we're pretty much asking agencies that were, you know, kind of in the middle of the hangover after the Black Friday Cyber Monday and holiday kind of season sales from last year. So confidence, I mean, actually that was the highest level of confidence that we've registered since, since January. It's been, you know, going downhill pretty much up until like June. It's when it started to pick up again. July, August, September have been going up, but still in the second kind of highest month in terms of confidence has been this month. I mean, September, but still it's nowhere close to what we register in January. So I have the feeling that, you know, it's kind of. It's getting. Well, I guess we'll see. You know, obviously if we continue doing this next year, we'll be able to compare notes, you know, one year versus other. But it seem to me that it's, it's fairly seasonal in sense of like you know, kind of like summer months, obviously slower and like everybody's kind of always looking forward to that. You know, black friends have Monday type of, type of event that kind of defines the year. And so. And again, we were talking about it earlier where in the last year, which was for a lot of brands was flat at best. They were looking forward to that Black Friday Monday event. To just see. Yeah, to see, like, okay, let's just, let's just close the year. Like, let's just see if it was really a flat year. It was positive, negative, like, you know, so. But, you know, we can't really say anything about 2023 until we hit mark. Right. And so it looks like it's pretty much the same happening this year. So 2023 all over again, really.

Matt Edmundson [11:01 - 11:04]: So people are finding it quite flat at the moment.

Raul Galera [11:04 - 11:33]: So I would say, I mean, it's, I mean, like 2023 all over again when it comes to that excitement about Black Friday and summer Monday. Like, it's, it's. I don't, I don't think it's been that flat of a year, but there has been seasonality and again, it's not necessarily like a. From what. Again, from what I've seen on the, on the responses that have gone from agencies, it hasn't been that kind of sustained growth that you're kind of looking forward to.

Matt Edmundson [11:33 - 13:09]: Yeah, that's interesting is if I was to think about my own experience, I'd say 2024 was definitely better than 2023. Yeah. Certainly in our online businesses, in our agencies and, you know, the people that we partner with and so on and so forth, this year seems to have been. It's not true for everybody, obviously, but on the whole it sort of feels slightly better. You've got a few key events coming up at the moment, which I think is really interesting. In the uk, we've got the October budget. So this is where the government decides how they're going to try and fill a big 20 billion pound tax missing hole. So everyone's slightly concerned about that, but at the same time, not. Obviously, we've got Black Friday Cyber Monday, which people are building up for. So I do wonder if retail sales have slowed with the new government and everyone's going to wait to see what happens and then obviously we've got Black Friday Cyber Monday, you mentioned it earlier. We've got the US Presidential elections coming up on the other side of the pond. What's going to happen? Who knows? It's a fascinating one. Do you think? Are we seeing events like this actually affect confidence or is it just me? Because Ecommerce business owners, when sales get down we obviously want to understand why and sometimes we try and attribute it, you know, oh well, the wind was going northwest rather than southwest. You know we, yeah. Am I being crazy or is there something in this across the board?

Raul Galera [13:09 - 14:31]: So it's, you know, it's obviously in hindsight we always try to look for answers to events that you know, may or may not be correlated but something that is. So I, that's, that's actually one of the questions that we asked in the, in the latest report was about US Elections. So do you think it's going to have a positive, negative or neutral impact on Ecommerce sales in Q4? And you know I was expecting to just, you know we ask agencies to rate it, you know, from, from 0 to 10. So you know, between 0 and 4 is negative, 5 is neutral, 6 to 10 is positive. I was expecting fives all across the board. Like people just like, you know, like, you know, I was expecting that kind of neutral answer. No, I was, it was actually mostly negative. So the majority of the agencies responded that they are expecting some sort of negative impact on Ecommerce sales. So you know it's interesting we're going to, we're going to get to publish another report right before the, the US elections. So because we're, we're planning, we're going to start planning the October issue now and we're going to publish it before November 5th. So it's, it's kind of interesting if like the trend continues or if it's kind of like a one time thing when you ask people for the first time. But, but yeah. So now answering your question, will they be right about it? I guess, you know, we'll find out. Yeah, we'll find out soon enough.

Matt Edmundson [14:32 - 14:37]: Did they give you any indication as to why they were negative in their opinion?

Raul Galera [14:39 - 15:40]: So you know it's, it's, I think it's one of the kind of keywords that I got the, you know, most like most. One of the most common keywords that we got from, from some of the responses and the quotes that we got were, was uncertainty in general. And so, and I'm tying that with other conversations that I've had throughout the year with other agencies. This is a theory that's, that's going around that I, you know, I, I think it makes sense because I've heard it from several people and is that whenever there's like a major event that takes people away from social media platforms in which in which they're exposed to ads. Yeah. Then Ecommerce sales go down. Meaning that, you know, one example that. A couple examples that I've kind of gathered throughout the year and I've had some agencies kind of confirm that that happened. So, you know, we all remember. I think it was like, I think it was like last year, right? The Titanic submarine type of thing.

Matt Edmundson [15:40 - 15:44]: Oh, yeah, yeah. Apparently there was a trial about that recently, wasn't there?

Raul Galera [15:44 - 17:38]: Yeah, yeah, exactly. So. But that was in the news for like, like three, four days. Like two. I don't remember. But apparently during those few days in which, you know, we were looking for the submarine, everybody was so focused on that or like that was driving so much of the attention that, you know, brands were spending less money on ads and so there were less conversions. At first, I found that kind of hard to believe, but I had the same feedback from multiple agencies and I, you know, and to be honest with you, that was one of the conversations that got me into, you know, starting a rapport like this because I was like, this is really interesting. And these are, this is stuff that, I mean, I only found out because I was, you know, kind of having a beer with one of these agency owner, otherwise I wouldn't have been able to, you know, kind of get that kind of data. And then, you know, got me thinking, like, okay, let's. There's got to be a way of verifying this and so, and so and tying it, tying that with US elections. So, you know, also during, during the World cup again, middle of the summer World cup, like, apparently sales in Europe were a little bit lower because people were paying more attention to the TV down on, you know, on social media, Instagram or Facebook or whatnot. And so it seems like it might be the same thing happening for. For the US Elections. Maybe we're not we. But like in the US they're spending more time kind of watching tv, like maybe debates, you know, not not only candidates debates, but like political debates on tv, you know, checking Twitter to see, you know, what candidates saying what. So that's also something that I'm getting is I might be driving that kind of. And there's a little bit of fear too. So I feel like you are being a little. Just, you know. Yeah. Kind of maybe afraid of spending money until we figure out what's going on. I don't know. But it's. It's definitely that kind of uncertainty. It's probably the main word that's been thrown right now.

Matt Edmundson [17:39 - 19:47]: And it's a really interesting word, isn't it? Uncertainty. Because you're right, I think when we are uncertain as people, we tend to sort of retreat into ourselves a little bit, don't we? And so we spend less, we go out less, we do less maybe of certain things like eat out or whatever. Yep. And, and whilst it's interesting, you talk about how the Titanic submarine resulted in lower sales for some people, because it's the most extraordinary sort of event, isn't it? And you can you kind of go, well, it, maybe you've only had like a very small percentage, but it actually had some kind of impact which fascinate, fascinates me. So you've got, you've got uncertainty, but plus you've also got distraction, haven't you? So you've got the distract. And I mean, let's face it, you know, the, the drama without getting political enough and, you know, offending my US cousins, the drama around the US election is, is unbelievably addictive and, and serves as a huge distraction, I think, in, in many things, you know, and I, I just, I find the whole thing absolutely fascinating in so many ways. But you're right, my attention is there, plus my level of uncertainty. Certainly in the uk, with what's going to happen in the October budget, you're kind of like, well, geez, these world events are actually having an impact on me. So I can see how they would be impacting a whole bunch of people, which has a, has an effect. I don't know if you've got any insights on this then Roll. I mean, how would you, how would you counsel somebody who is running an Ecommerce business right now? How do you market well in times of uncertainty and distraction like this? Because there's obviously things that we can do when things are going okay, but actually understanding the sign of the times for want of a better expression and doing something well in that time, well, that's a different skill set in many ways, isn't it? And so I'm kind of curious, is there any insight on how to manage this?

Raul Galera [19:48 - 22:14]: I mean, I would say, and probably saying this because it's the type of marketing that we do at Referral Candy, but at the end of the day, brands that work really well are those that have a community around them. And it, you know, it doesn't necessarily have to be a physical community. And by physical, I don't mean like in person and I also mean like, you know, like a, like a Reddit, you know, like a subreddit or like a Facebook group or anything like that. It's literally a community of like, okay, you've been able to identify a group of customers that probably even before they bought from your brand, they identify with you. And so you know, you can use, you can use ads to get in front of those people. I mean you can get really good at ads targeting and figure out ways that you can again, like, okay, these people fit this criteria because they have these catch different, you know, categories and they check all these boxes. I want to get in front of them. Yeah, but at the same time it's kind of creating that word of mouth. And so you know, when you have a product that it's not necessarily generic because, and I don't mean like the product itself but like the way that you're selling it to people and the way that you're kind of like framing because you know, you can sell T shirts but you can, you can sell a million different types of T shirts to a million different type of people and you know, make them see it and realize, okay, that's, that's mine. That's, you know, that's exactly me. Like I, you know, I definitely need this. Right. And so again, when you have, it all comes down to product market fit. Right? So when you have product market fit to the point that you, you're able to just show your customers that you have the product that they have been looking, looking for even before they knew that they were looking for it, you're gonna be able to generate word of mouth around it. And yeah, and so you know, your customers are going to talk to other people that are going to start, they're going to start posting on, posting on social media, they're going to start living reviews, they're going to start generating all these, you know, user generated content that you can then leverage on other, on other platforms. So you know, at the end of the day, obviously ads are important and you know, obviously a lot of the messaging that we put out on referral candy is, you know, you don't, don't, don't, don't waste your time on, waste your money on ads. But you need ads. But it's all about like get the most out of it. So once don't just spend money on acquiring a customer and then kind of forget about it. That customer can become your salesperson.

Matt Edmundson [22:14 - 22:14]: Yeah.

Raul Galera [22:14 - 22:39]: Make sure that after they buy they're so happy and they're so satisfied with your product that they're ready to tell their friends about it. And even on top of that you're, you're, you know, coming up with a Some sort of like referral structure that makes it even bigger of a no brainer for them to refer. So yeah, that, and that's kind of like the long term type of marketing plan that you want to have.

Matt Edmundson [22:40 - 23:32]: Yeah, that. Powerful stuff. Powerful stuff. I like this because I mean in times of uncertainty, in times of distraction, you've got to stand out and you've got to give people a compelling reason. Right. And I think you can't be beige, you can't be the same as everybody else. You have got to stand out. So having, I love this, having a community is a great idea. What that means for you and your business is obviously very interesting and very different to everybody else. But focusing in on the community and focusing on an expand, delivering an experience that you know, just delivers. Wow. As we like to say on the Ecommerce podcast, deliver. Well, I think are always very sound old school marketing tactics and principles. And I think you're right. I think great ideas, you know, in times of uncertainty and distraction. So what else has come out from this research then? I mean what else has surprised you?

Raul Galera [23:33 - 27:49]: So and the latest report, one of the, one of the findings that I found more interesting is how brands. So you know, the report is about Ecommerce agencies, but at the end of the day their behavior depends on their customers, which are brands. And so you know, by asking agencies in extension, we're getting data points from hundreds of other merchants. Right. So the picture gets really interesting because you're again kind of like using agencies as a proxy, you can estimate how the rest of the Ecommerce world is doing, how brands are doing. And so one thing that I found really interesting in this last particular report is that so we always ask agencies what's if they've noticed any changes in terms of prices, price sensitivity. So when you talk to customers about, you know, renewing your contract or negotiating retainers, whether it's a new customer or an existing customer or negotiating new services or whatever it is, how sensitive are these customers to these price changes? And that the next question that we ask is do you see brands more likely to hire in house or to outsource to agencies? And so in the latest report we got a spike in price sensitivity. So it turns out that, you know, somewhere between August, September, brands got more, more sensitive to price. So more sensitive to price changes. You know, it makes sense. They, you know, everybody's looking after their costs right now because of, you know, inflation. Costs are going up and so you want to keep everything under control. You're probably your CFO is, you know, probably questioning every single line in the budget, like, do we really need this? Like what's discharged? They recognize this. So, you know, it's happening in all across the board. And so they, they did notice a spike in price sensitivity, which you would think, okay, well then, you know, that probably means that, that brands are going to hire more in house. Like they're, they're spending less money on agencies. You know, if they're, if they're getting, you know, turned off by some of the quotes that are getting, that probably means that they're going down a different route. But when we ask that question about whether brands are going in house or outsourcing, we, we got a vast majority of agencies that saying that brands are outsourcing, that they're more likely to outsource than to go in house. So it's, it's kind of like a paradox, right? Like, so, yeah, agencies are getting more exp. In the eyes of brands, but brands are still going after them. And I think, and the explanation that I, that I got, which again it's, it's just, it's my own explanation, I don't know if it's, if it's correct, is that at the end of the day, hiring an agency has a set of intangibles for, for brands that make it more attractive than hire an employee or hiring a team in house. When you're hiring an agency, you're not only getting access to their, you know, their skills and their team and you know, and whatnot, you're getting access to their creative data and collective knowledge of all the brands they work with. So you, as a CMO of an Ecommerce brand, you have access to one data point, maybe a couple if you have, you know, people in the industry that you talk to. But when you're working with an agency and you know, you're having a, a weird month or weird week, you can say, hey, is this normal? And they can say, oh yeah, all of the other brands in your vertical are, you know, kind of seeing the same thing. Or like, hey, we're actually seeing some trends right now. Like, you know, you can have access to that collective. Yeah, intelligence, I would say that I feel like, makes it really powerful than hiring in house. Obviously, you know, hiring in house and versus an agency has. It also depends on, you know, what's the pricing model that the agency is going after. Are they taking a commission on revenue? Are they charging a flat fee? But, but again, I thought it was interesting that there's like this paradox of brands are going with agencies Even if they find them more expensive, at the end of the day, they're still settling for, for outsourcing versus going in house.

Matt Edmundson [27:50 - 30:19]: Yeah, it's fascinating, isn't it? And I get on one hand how that would be a paradox, you know, and. But on the other hand, I guess one of the things I am noticing is obviously ecom companies, they're cutting costs quite a bit. Everyone's becoming very cost conscious because it's. There has been so many price hikes. It's actually quite complicated now, I think, to rise. I'm not saying you shouldn't increase prices, but I think people have increased prices but still need to manage costs. And so they're looking in, you know, internally at how to do that. So I can see them going, actually, we spend four grand a month with that agency. Can we find an agency where we spend three grand a month and get the same output? Right. So I can see why people would ask that question. But I guess I also see how internally I might say, well, I need to hire two new people. Right. So real life example, I suppose at our company, I'm looking to hire two people at the moment. It's a very real question now to ask myself, well, do I actually want to hire somebody or can I outsource this work? Right, right. And so I'm, I'm looking at my own cost base and going, right, what do I actually do in house and what can I outsource? And so I can see how this creates this sort of paradox. I'm looking maybe to outsource more because I want to keep my internal costs down, but in outsourcing more, I'm going, oh, I'm not, I'm not happy with four grand a month, dude, I need it to be three, you know, that kind of thing. And I, I've seen that a lot, actually. I've seen that a lot. I've seen agencies, especially freelancers, so agencies where it's just maybe one or two people, you know, just sort of doing the ad spend and things like that. I, I've seen them getting squeezed by companies and because they are one man bands for better, you know, their soul. And it's just them really, that's why they're freelancers. It's really hard to. Unless you're full on with work. It's really hard to go, okay, I'll just drop my prices for you, rather than just turning around to them and saying, oh, well, if you don't want to pay, go somewhere else. It's not actually an easy thing. To say, is it. If you're a freelancer, it's easier, I suppose, if you're an agency, but even then everyone's a little bit twitchy at the moment. So again, coming back to your uncertainty observation, I think that's interesting. I do think that's interesting. I'm kind of. Go ahead.

Raul Galera [30:20 - 31:03]: I was gonna say, I think it also has to do maybe with the learning curve. Curve. Because especially at this time of the month. Sorry, at this time of the year, if you are in that position and you're an ecommerce brand, you know that hiring an employee, you're probably not gonna see any results anytime soon. Cause they need time to ramp up. Agencies need it too. But agencies usually come with SOPs and they're ready to deploy almost because it's for them. It's sort of like, this is literally my everyday. This is literally what I do every single day. Like you're, you know, you as a brand, you're probably not that different from the 15 other brands that I work with. So maybe that, that speed factor might be an aspect that brands value over hiring in house.

Matt Edmundson [31:04 - 31:23]: Yeah, it's an interesting one. I was going to say, I'm kind of, I'm curious also whether actually the traditional agency model that we've experienced the last few years, whether that actually needs to change as well. I appreciate this is a much deeper conversation.

Raul Galera [31:24 - 31:25]: Yep.

Matt Edmundson [31:25 - 33:16]: Than what we're thinking, but I, I've not. We have an agency, right. A media agency. And we went down the traditional route of this is our service, this is our retainer. You pay the retainer, we do the service. The problem I think people have got is, and this is my experience in using agency, is that when you go to an agency, you get a great service at the start. But if that agency is good, they're going to grow, they're going to get more clients, and the people that are good for you are now going to be good for three people, four people. And so the quality of work for you gets less and less, the feedback gets less and less, you get annoyed and then you end up going to another agency and the whole process repeats itself. One of the things that we've done, and I can't give you any hard data yet, Raul, I'm not going to lie because I just don't know. I'm intrigued to see the results with one of our agencies is we have gone to the market and we've said, right, listen, this is the work that we're going to do. This is the fee for that but at the end of a predefined period, which in this particular industry is going to be, I think about five months, at the end of those five months, your staff will be trained on our processes and we'll be able to do a chunk of the work. So we will help you get up and running and we will train your staff. Now if you don't have staff, we will carry on doing the work for you under the traditional retainer model. But if you do, we will train them and we will move from doing the everyday work into a much more sort of consultative coaching role to make sure the staff stay on top of things and, and go forward. The initial response to that actually has been really positive. But like I say, it's all anecdotal at the moment. And so part of me wonders in the midst of all of this, whether the agencies which change their models to whatever it is, maybe could find a way to win.

Raul Galera [33:18 - 33:25]: Yeah, I've, I actually had a similar discussion last week with Jordan West.

Matt Edmundson [33:25 - 33:28]: I know Jordan, he's a legend. He has been on the show.

Raul Galera [33:29 - 34:10]: Yes. Oh yeah, I saw, I saw actually so, and you know, he, he mentioned actually so I was on, in his podcast and I was asking him so many questions that at some point I felt like I was the, the host. But, but one of the, one of the, so we were talking about this particular question about the retainers and the in house versus outsourcing. He mentioned that, that agencies, when they do like a, like a kind of performance based or like, you know, revenue based type of, you know, get a commission on the revenue Lyft or something like that, that at some point if you do too well, it will get you fire as an agency.

Matt Edmundson [34:10 - 34:11]: Yes.

Raul Galera [34:11 - 36:21]: Because you'll have the CFO saying, wait a minute, 30k. Like, oh sure, you know, we made, you know, I don't know if these were the numbers that he mentioned. I'm sure it was just like, you know, kind of just relatively figures. But you know, if you make a brand generate a million dollars and you get 30k out of it, 3%, sure. Great. You know, you've, you've made the brand get a million dollars in revenue, but they're going to see a 30k bill and the CFO in question is going to say, wait a minute, do we really need to spend 30k on this? Because obviously. And again, it's the same thing that we were talking about earlier. In hindsight it looks pretty easy. It's like, oh, okay, well this agency got it for 30. There's gotta be an agency that maybe gets a little bit less, but we pay a lot less. Right. And so, and I feel like that's a raw mentality, but at the end of the day in a company, you have a ton of different stakeholders. The CFO has one job and you know, and it's, it's also, you know, I think it's also the CMO or the CEO job of saying, no, no, no, you know, we, we need us, we're not. We wouldn't be able to get where we are. But again, in hindsight, it always makes it a little bit more difficult to see. But yeah, that's so, you know, answering your question, I don't know, I don't know what's the ideal pricing model when again even like what it could be considered like the most fair type of approach, you know, can also. And you know, we've seen our referral candy too. I mean, referral candy, we take a commission on refer purchases. So on the revenue that the referral program generates. Yeah. At some point we get questions. At some point it's, you know, when we are able to help a brand get to a certain size in the referral program, some of them have question of like, well, whether, you know, I'm paying a lot. Like, you can prove what you've generated, but the bill is there, the invoice is there. And so I can see how it can generate that kind of situation. Whether it's a brand talking to an agency or a brand talking to an app.

Matt Edmundson [36:21 - 37:52]: Yeah, absolutely. It's really fascinating, isn't it? I mean, the whole thing just. And if you're listening to this and you're an Ecommerce owner, then, and you know, having sat on both sides of the fence, having been and still running agency and having been and still running my own Ecommerce businesses, I get to see it from both sides. I really do. And I think that I would just. Probably the best advice I could give you is just communicate well and ask lots of questions. Don't let the anger and resentment build up, have the conversations early. And I think agencies are learning more now to adapt to that and I think it's an important thing to do. And of course, I mean, you mentioned Jordan West. He was on the show. We were talking about TikTok shops and he was on the show, I think, back in May, if you want to check out that episode, Dear Listener, it was a great episode. He's again such a legend. He and I are on WhatsApp all the time, just chatting away. He's such A good guy. So I'm curious to hear that conversation you had with him. If I'm honest with you, Raul, I'm going to listen to that one. Speaking of questions. Right. One of the things I like to do in the show, which I say like to do is a more recent thing that we've been doing is ask a guest for a question. For me, this is where I ask you for a guest. I'm not going to answer it now. I'm going to answer it on my social media platforms. So this is my little trick, my little come and join me on social media thing for you, dear listener. Raul, what's the question?

Raul Galera [37:52 - 38:04]: Well, we kind of talked about it earlier, but I want to get your full answer on this. How do you see the US elections affecting Q4 sales?

Matt Edmundson [38:05 - 38:31]: Fantastic. If you want to know how I see the US election affecting Q4 sales, then come join me on social media. You can find me at edmondson, both on LinkedIn and Instagram and I'll be posting the answer to that and the other questions I've been asked soon. So, yeah, do come, follow me. Well, anything else in closing? I mean you've, you put this together every month. Is there anything else in the data which you found, which you've kind of gone, that's a little bit surprising?

Raul Galera [38:32 - 39:26]: I don't know if it's surprising, but it's just something I like and that. So the last question that I ask, the last two questions that I ask agency owners are, you know, how you see your agency's revenue looking like in the next six months. And then also how do you see opportunities in the Ecommerce world looking like in the next six months? So it's more like, you know, just let's predict the future, right? Like, how do you see it working? And you know, even when we were having like months with like, like negative responses on marketing budgets, on price sensitivity, on you know, on different, like different aspects that we ask agency owners, those answers were always positive. The answer is kind of, what's the outlook? You know, it does not surprise me. And I've talked to a few people about it and they say, oh yeah, like, you know, I mean, and you know, the majority of our owners are entrepreneurs. They have to be positive.

Matt Edmundson [39:26 - 39:28]: I mean, it's got to be optimistic.

Raul Galera [39:28 - 40:02]: Exactly, exactly. So that's something I particularly love. And so again we, you know, this, this month was no difference. I asked, you know, how do you see the US Elections playing out? How you see, again, we talked about the marketing, but marketing budgets were up, but because of Black Fridays every Monday preparation. But again we talked about price sensitivity and all that and. Yeah, but how do you see everything looking like in six months? Oh no, it's amazing. So I mean I love it. I mean it's. And to be honest with you I'll be worried the day that I see negative outlook in that.

Matt Edmundson [40:02 - 41:34]: That's true. Yeah. Because then you know you've got, if the entrepreneurs are downbeat you've got a real problem, haven't you? Yeah. I think that there is a blind optimism, isn't there with entrepreneurs And I actually quite like that because you need people who go no we, this is going to turn around, we can, we can do something here, there's opportunity for us, let's go take the hill. When everything around them is collapsing, you know and there's something quite magical if not self denial about that. It's one of those and I think you need people around you like that. And agency owners especially and I think Ecommerce entrepreneurs cut from the same cloth when you talk to an agency, if I go and talk to an adwords agency, give them my account details, they're going to look at that and go man, we can totally kill this for you. Right? They're going to say, they're going to say that because that's what they're going to say because that's what they actually believe and think if they didn't, oh mate, we can't beat that. Or may. It's just downhill from, for you from here, isn't it? It's that kind of actually you need that, that sense of positivity. The danger of course is you oversell and under deliver and you get caught up in that excitement, don't you? And so I think as Ecommerce entrepreneurs we, I listen to agency owners and I'm like, I just need to filter what they're saying because they're passionate, they're excited and then there's a reality of life.

Raul Galera [41:34 - 41:58]: Yeah, yeah. I mean you're, you know, you're, you're selling and I do a lot of sales calls, referral candies. So like if you're, if you're an Ecommerce store and you request a demo, there's a chance that I'll be the one that's on the other side of the screen and you know, you, and you gotta, I mean you gotta believe in what you're selling.

Matt Edmundson [41:58 - 41:59]: Yeah.

Raul Galera [41:59 - 42:07]: You gotta believe in what you're, what you're capable of doing, you know, whether it's an agency or an app. So I totally get that. And you gotta have that optimism.

Matt Edmundson [42:07 - 42:19]: Yeah, yeah, you do now. I love it, Love it. Well, listen, man, if people want to reach out to you, I mean, you've mentioned it at the start of the show, but let's talk about it again now. If people want to reach out to you, if they want to connect with you, what's the best way to do?

Raul Galera [42:19 - 42:33]: If they want to email me, it's raul"referralcandy.com and if they want to check out the report, that's referralcandy.com/eaci, which stands for Ecommerce Agency Conference Index.

Matt Edmundson [42:33 - 42:38]: Yep. And do check it out. I mean, I've read through the September report is very, very insightful.

Raul Galera [42:38 - 42:39]: Thank you.

Matt Edmundson [42:39 - 43:21]: And yeah, really, really well put together documents. So do sign up for that. Do go and get that. It is free to access, so go check that out. And of course, do connect with Raul if you've got any questions, even if it's just to say hello, I'm sure Raul would love to hear from you. And of course we will link to everything that Raul has given us in the show notes as well, which you can get with the transcript and all that sort of good stuff. You can get it on the website ecommercepodcast.net and of course, like I say, you can get it in the show notes to scroll down on your app. And if you sign up to the newsletter, that'll be coming to you anyway, just automagically. Well, listen, man, it's good to see you again and good to chat again. We should do this more often.

Raul Galera [43:21 - 43:25]: Definitely not every three years. Probably in a few months.

Matt Edmundson [43:26 - 43:28]: Maybe let's get you on sooner next time.

Raul Galera [43:28 - 43:29]: Sounds good.

Matt Edmundson [43:29 - 43:40]: But genuinely, thanks for coming on, man. Really appreciate it. Thanks for sharing the insights and love what you guys are doing and thanks for putting it out there. Thanks for making it free for people like me to get some insights. Really appreciate it.

Raul Galera [43:40 - 43:42]: Yeah, thank you. And thanks for having me again.

Matt Edmundson [43:43 - 44:12]: No worries. What a great conversation. Huge thanks again to Raul for joining me today. Now be sure to follow the Ecommerce podcast wherever you get your podcasts from because we've got some more great conversations lined up and I of course don't want you to miss any of them. Why would I? I wouldn't. And in case no one has told you yet today, let me be the first. You are awesome. Yes. You are created awesome. It's just a burden you have to bear. Raul's got to bear it. I've got to bear it. You've got to bear it as well.

Raul Galera [44:12 - 44:12]: Now.

Matt Edmundson [44:12 - 44:48]: The Ecommerce Podcast is produced by podjunction. You can find our entire archive of episodes on your favorite podcast app. The team that makes this show possible is Sadaf Baynon and Tanya Hutsuliak. Our theme music was written by Josh Edmundson, and as I mentioned, if you'd like to read the transcript or show notes, simply head over to the website ecommercepodcast.net where you can sign up for the weekly newsletter and all of the good stuff gets delivered straight to your inbox. Totally for free. But that's it from me. That's it from Raul. Thank you so much for joining us. Have a fantastic week wherever you are in the world. I will see you next time. Bye for now.

Raul Galera [44:57 - 44:58]: SA.