Does Your Ecommerce Business Need To Hire A Marketing Agency?

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Francois Marchand: Digital marketing agencies. Now, many ecommerce businesses handle marketing on their own. They have solid campaigns in place, they have good sales conversion rates, and they can handle brand building and the sales funnel all by themselves. So when is the right time to hire an agency to handle your digital marketing campaigns?

Welcome to The Ecomm Manager Podcast. Our mission is to help you succeed in your ecommerce journey with helpful advice from the experts who made it big. I’m your host, François Marchand. 

Today, I’m joined by Jonathan Naccache. Jonathan is the CEO of a digital marketing agency called Webistry, and we’ll be chatting about what an agency can do for your ecommerce business and what you can learn from them. So stay tuned to discover some of the factors that should drive your decision to hire an agency to handle your ecommerce marketing campaigns and some overlooked marketing campaign elements that every ecommerce manager should pay attention to.

So Jonathan, thank you so much for being on this episode of the Ecomm Manager Podcast. I was really excited to talk to you today about when ecommerce businesses should feel they’re ready to hire a marketing agency like the one you founded and you run Webistry to help with their digital campaign management.

So for the sake of clarity and just to let people know what you and your company do, why don’t you give us the Coles Notes on Jonathan and Webistry?

Jonathan Naccache: Yeah, well, let’s start with Webistry because that’s the most important part. Jonathan is just a small piece of it. So Webistry, I’ll just give you the short version of it.

We’re an advertising agency. However, we do not solely focus on acquiring a click for you. We’re really focused on the entire user journey. And so we do have a paid media team that could handle anything from Google to Meta, TikTok, Amazon, etc. However, we also have a CRO team, Conversion Rate Optimization, or Experimentation team, which consists of data analysts, designers, project managers, etc.

And we have a team of developers as well to put all of our ideas into reality. So it’s a very holistic approach, not easy. We didn’t always start off as the full journey agency, at first we were a Google ads agency in our first year of operation about 12 years ago. So it kind of evolved very naturally as we started to understand what the needs were in the market and for our clients to perform better.

Francois Marchand: Right. Tell me about Webistry’s involvement in the world of ecommerce. Like what do you do for ecommerce companies in terms of services or advice or anything else that you provide for them?

Jonathan Naccache: Yeah, so as a whole, our mandate is to grow their sales profitably through online advertising channels. At times that does involve post click optimization on the store level on the website, whether it’s with design, functionality, certain features, copy even and testing post click, so split testing and so on. So it’s really about acquiring customers, growing that customer base, and making sure it’s in a profitable fashion through the means of advertising, landing page design and post click optimization.

Francois Marchand: Perfect. Thank you so much. So let’s start with the elephant in the room.

If you’re an ecommerce manager or business owner, when do you know that your ecommerce business is ready or it needs to hire an agency like Webistry, for example, to help with that side of the business, like the digital campaign management, the post-click optimization, all that stuff?

Jonathan Naccache: That’s a super good question. And in fact, I wish more clients ask themselves that question before reaching out to us for their own good, for our own good. And it could be different for different businesses. I would start that off by asking yourself a range of other questions first, and through that you’ll reach your answer. So for example, first question I would ask myself if I am that business, is this a make it or break it move?

What does that mean? If the first agency or freelancer I hire fails, how damaging will that be to my business? Can your business take a few learning lessons? Sadly, it might take a few trials before you find the right team. And we are definitely the right team, but sometimes it’s a question of fit.

You can have the best people that you’ve hired, and if there’s no fit, then it might not work out. So it can’t be a make it or break it situation. You have to have some wiggle room there. Another question I’d ask myself is, am I hiring because my account has reached a peak, a plateau? As soon as I try to scale, my results plummet, and I don’t know what to do anymore with that.

And there’s a need to scale and to grow and not remain at the status quo. So some accounts can do very well at first due to the low scale of the operation and a business could do it itself, right? Sometimes it’s the decision maker running the ads themselves. Sometimes it’s an assistant. However, as you start scaling, this is where all the expertise starts coming into play, where it’s no longer about just toggling an ad on and off where you need a designer to create compelling videos for your creatives, where you need a designer to create a page that is how you’re converting and the post-click experience. And so that’s usually a series of people who are very good at what they do. And if you were to hire those two or three people, it would cost you a lot more than an agency.

The most important one for me it’s do your margins allow for an increase in your cost per acquisition, right? You have to look at your finances. Can you afford to pay someone who’s going to get you better results, but by hiring just those fees will impact your CAC your cost of acquisition.

And so you have to do your homework and, have your COGS, your cost of goods sold broken down. I have to say about probably 80% of our clients do not look at that. They don’t even have that number until we compel them to calculate it. So what is your COGS, your cost of goods sold, what are the agency fees going to look like?

And when you put that together, what is your break even ROAS? What is the return on ad spend or the CPA that you need in your ads in order to simply break even? And when you get that number, you can ask yourself, is that number realistic? Is it possible? If it’s not possible, then either you just can’t afford help, or you have to look at your business model, your cost of operations, your cost of goods sold, product, your inventory, your rent, who knows? So kind of have to dissect everything first. 

Francois Marchand: Yeah. Have you seen situations where, for example, there an ecommerce company that’s growing, they have a small marketing team, but they’re kind of in over their heads, right? They need to take it to the next level so they ask an agency to help and can like an agency compliment marketing efforts in house or do they have to work separately or how does that work?

Jonathan Naccache: That’s a very good question and it’s very relevant to our times. You could have a really kick ass campaign manager who knows Google ads very well or knows Facebook ads, Meta ads very well. However, those platforms are changing very quickly and tremendously. And in the near future, Meta ads will not be a question of knowing what to do on the ad account.

It’ll be a question of really good creatives. It’s already a big variable. It might be the only variable in three, four or five years. So you can be great at managing your account, but you need design support or you need developer support to create a better experience post-click. You need a better copywriter.

So oftentimes we will work with clients that could handle the core on their own internally. But I’ve trouble hiring the right designers, hiring the right copywriters, hiring the right team, or just getting the right advice and strategy because they haven’t been exposed to all the different businesses out there and they haven’t done it all yet.

So with the right team and the right fit, yes, you can get a compliment or complementing agency to help you. 

Francois Marchand: Perfect. You talked about how it’s changing, like Meta is changing. Google algorithms are always changing. AI is coming in too. I’m going to ask you, is that a challenge for agencies to bridge the gap for companies that hire them?

Considering all these tools are now kind of generating their own copy, generating their own design, generating all this content that doesn’t necessarily need like a team support. So maybe you can tell me a little bit about how things are kind of shaping up from an agency perspective.

Jonathan Naccache: Yeah, absolutely. Let’s travel through time into the future in a world where AI could design your creatives for you. And they’re great and they look real. I just saw an AI generated commercial for beer. It was a little scary. I’m not sure if you saw that one. So, so we’re not there yet. It’s going to take some time where AI could generate good ad copy.

We’re probably already there. I would say for that one, that’s very doable and so on and so forth. AI will be able to make decisions based on your goals and optimizing your campaigns, turning ads on and off, reallocating budgets, adding negative keywords in Google ads. I got plenty of examples. I think we’re not far from that reality.

It’s going to happen. And in a reality like that, what help do you need? You need a strategist. You need someone who can come up with ideas. Someone who is good with storytelling. Or a team that could bridge that gap between the output and the strategy. Agencies that are not training their teams to do that or to be good at that, they will be the ones who might have a harder time adjusting.

So for example, at Webistry, every account gets a campaign manager and an account strategist. The account strategist is not a customer service rep. They’re not a customer facing rep. They’re a very experienced campaign manager who has been trained, who has been exposed to many situations and different businesses and has graduated to helping the client through strategy, reading reports, giving advice beyond the ad account at the business level as well.

Cause a lot of solutions are on the business level and beyond the ad account. So we’re preparing for that future by doing that. 

Francois Marchand: Yeah, must be a challenging time. Must be exciting too, because the technology will allow you to do more things from the agency side as well. So let’s talk about results. What kind of results has Webistry been able to deliver for some of its growing ecommerce partners?

If you have some examples of recent partnerships that have yielded some good results, we’re all ears. We’d love to know about it. If you can share, obviously, if it’s not like top secret or anything. 

Jonathan Naccache: It’s a gray zone, so I’ll have to be careful. So one example comes to mind, I won’t name names. I could tell you what brought them to us first, a few challenges that they were facing.

The first challenge was that, as a business with investors, there was an expectation of growth that needed to be met for the business to survive. It was doing well, but that growth had to be achieved. Every time they tried to scale their ad spend, the results would plummet, putting everything at jeopardy.

The second challenge that they were facing is that the team that they were working with had sort of reached a point where they were on autopilot. The ideas were not coming in, the strategy was not coming in, the ability to adapt when things didn’t go the right way, it just wasn’t there. So we came in with, a very in depth audit.

We had a lot of ideas, both technically but also from a strategic standpoint. We also brought to the table the full user journey approach. So we’re not looking at just your ads. We need to look at post-click, the landing page level, the website level. We need to test things, even going as far as price testing.

Is this the right price point for a new product that no one has ever heard of? An innovative product? How do you determine that? What brought you to that price? And can we try to see if another pricing model can work? So I’m not talking about dollar amounts, but what if we expressed it in monthly payments?

What if we charge differently for this product? And so we were able in the first three months to double their ad spend, which they weren’t able to even increase by 5% beforehand. And in doing so, we’re able to also reduce their cost per acquisition by three times. And then six months later, we were spending about 1 to 1.5 million per month on one platform alone. 

So that was a big one and the main reason why it was a big one and a big success is that we took an account that was spending moderately to spending very high amounts. And that’s the toughest thing to do. You can inherit a high spending account. Not saying it’s easy, but it’s easier.

You can inherit a lower spending account. And the strategies for both those situations are completely different. The requirements, the expertise are completely different, but getting an account that has to go from here to here is definitely a much bigger challenge and requires a lot of adapting and pivoting.

Francois Marchand: It’s interesting because you talked about fit earlier and it sounds like if they’d gotten to the point where there were an autopilot, it was time for a switch. It was time for a change and they found a new agency. So maybe that’s something to keep in mind if you’re working with an agency out there and you realize that you’re kind of just standing in place and not moving forward, something to consider, look at your options.

The other thing is that it sounds like you have to invest in an agency to make money, right? So there’s a spending involved. So obviously there’s a cost involved if you’re going to grow and if you’re going to grow your return and lower that cost per acquisition, it seems counterintuitive in a way. It’s like, Oh, I have to spend more money to make more money.

How does that work? But that’s the way it goes with working with, in partnership with an agency and an agency like Webistry can tell you how much it’ll take to get you over that line, to achieve your goals basically. 

Jonathan Naccache: It’s definitely scary if it’s your first time making that decision. It’s a big decision for most companies and it’s not a low cost, you know, it’s not like hiring freelancer part time and then it doesn’t work out within two weeks.

There are entry costs, usually there are set up costs involved. And once you invest that money, you have a hard time leaving because it’s a bias, right? You’ve invested that money, you might as well continue another month and another. And then you realize it didn’t work out. So it is scary to take that risk.

I think the interview process is very important. A sales rep could be really good, gain your trust, but they’re not the ones you’re working with at the end of the day. I really recommend that if the agency is willing, and if they’re not, that’s another thing, but if they’re willing to introduce you to the person that you would be working with.

I strongly recommend they do an in depth audit and give you recommendations. Some agencies do not want to give it away, but if they’re willing, that’s very telling of their commitment and their personality as a company. So try to validate their values and don’t necessarily take their word for it. Make them prove it through action.

Francois Marchand: Yup. Get the results, see where it takes you. What is, in your opinion, I mean, there’s probably a few, but what’s the most commonly overlooked element of a digital campaign that you see when you onboard a new ecommerce client? You’ve mentioned a couple of things about new clients and things that they might’ve overlooked, but when it comes to just getting ready for a digital campaign, yeah, something that is commonly overlooked when they approach you.

Jonathan Naccache: So the first one, especially in ecom, I’m calling out ecom, putting you on the spot ecom. Landing pages. In the lead gen world, especially in advertising, the notion of a landing page, a page that lives outside of your website, that is designed with a specific user, persona, audience in mind, for a specific product in mind. And that is designed as a sales pitch, visually speaking, with the information being displayed.

That is the norm in lead gen. It’s been the norm for a very long time, for almost 10 years now. But for ecom, other than a few exceptions and a few trends that came and have gone, it’s not as common. Usually, from what I’ve seen, traffic is being sent to the store, either a homepage, a collection page, or a product page.

And I’m not saying landing pages should always, be part of your strategy, but they shouldn’t be overlooked. And even if you’re sending traffic to a website, the page that they’re landing on that website, really needs to be looked at. And you need to ask yourself, basically, if you are buying a product in the real world, in a retail store, in a brick and mortar, you’re at Best Buy, and you’re shopping for something that’s quite expensive.

You usually need a salesperson to help you, to convince you, to overcome your objections, to answer questions before you’ve even thought of asking them. If your page that you land on does not do that, then you gotta think about it. That’s the number one thing, and it’s mainly overlooked and neglected. The second is creatives.

It’s not enough to have a banner or a video. It needs to be a good one. It has to be compelling. The storytelling needs to be compelling. And again, that’s your first impression. So obviously I’m talking about Meta ads or YouTube, anything where a creative is required, that’s going to be, and is already probably the biggest signal for Meta right now in terms of putting you in front of the right audience at the right cost and getting the right people clicking so that they convert.

It’s no longer your audience target. In fact, most of our targeting right now is no targeting, maybe age, maybe gender, but no interests and no lookalikes. It’s broad. We call it broad in our industry. It’s really the creative and the landing page that will signal to Facebook or Meta who should be seeing your ad.

Francois Marchand: So the segmentation is not the same as it was in terms of when we talk about the way Meta is looking at where the ads are being showed and to who it’s what they actually look like instead. 

Jonathan Naccache: Exactly. They still have access to a lot of data. iOS update did change things, but still pretty powerful.

It’s just no longer, that specific interest, cats. Right? That fine test that interest. But the real signal is a creative that talks about cats and a landing page that talks about cats and only cats. So if you sell products that are for cats, dogs, and lizards, well, you should have a set of creatives that are cats only, a landing page that is cats only, speaking to that persona, so that Facebook knows to put you in front of cat lovers and not just animal lovers.

That’s a perfect example of what I’m talking about. 

Francois Marchand: Perfect. So we talked about landing pages. That was one. We talked about creative. That was two. What was number three in terms of your most commonly overlooked elements when you onboard a client?

Jonathan Naccache: Yeah. And it’s probably the biggest one because agencies will not talk about it.

So it’s really up to you to think about this as your business metrics, your KPIs, your stats. And there’s a few that are super important to have in place and to track throughout the relationship with the agency. I spoke about cost of goods sold earlier. It’s super important metric to have for any business.

It’s often overlooked. It just is. The breakeven return on ad spend or breakeven cost per acquisition. Spoke about that earlier as well. There are two other metrics that I really encourage to track. The use of those KPIs are one, to track the overall business health of your strategy. And two, validate whether or not the tracking in Facebook, Google, Amazon, etc., is accurate. Because it is no longer accurate by a lot, not by a little bit. And those metrics are the MER, Marketing Efficiency Ratio, which is revenue divided by ad spend. You could have an MER that is for new business only, and that would be new customer revenue divided by prospecting campaigns only, excluding any retargeting.

That helps you assess the profitability of acquiring a new customer. The second metric is the PSM, Profit Scaling Margin. And that’s a longer formula. It’s your lifetime value, LTV. Important to track that as well. Most people don’t even know what the LTV is. If it’s in your business, that’s fine, that’s fair.

So LTV divided by cost per acquisition plus cost of goods sold. Your total cost of selling this product. So add up your CPA with your COGS. Then LTV divided by that number. And that’s usually a very easy number to track. The fluctuations are easy to track. And you can compare both the MUR and your PSM to other KPIs like ROAS, CPA reported by your platforms. And you can try to see if there are any correlations there. 

Francois Marchand: I figure that the numbers that you’re looking for as an agency are going to vary depending on the, the size of the business, the number of products sold, that kind of stuff. Is there kind of a benchmark or are there kind of benchmark figures that ecommerce managers and business owners should be looking for, or does that vary from business to business?

Jonathan Naccache: Yeah. It does vary, but we know what is considered exceptional, what is considered poor, and what is considered okay. We do have an idea, and so if you calculate your breakeven ROAS as a business, and it’s 10x, I will tell you before I even try to sell a contract, I will tell you’re unlikely to hit that. And perhaps advertising online is not a good fit, or perhaps you have to take a second look at your cost of goods sold and your business model, if you do want to be advertising online. 

So I can say that, for pretty much any platform, if you can acquire a new customer through ads alone for anywhere between, two to three X as a return on ad spend, that is considered good. So if you can’t be profitable at two to three X, then you should look at other options or reconsider things. Now, you might be able to hit 6, 7, 10, 15 x. It’s not unheard of. It’s possible for some, if you’ve hit gold on a certain vertical or target market. And even if you are hitting that, it might not be a forever thing. And you’re trying to build a business for the longterm, or at least I’m assuming you are.

So if that’s the case, then you need to make sure that if your ROAS starts declining because these platforms are forever changing and evolving and are subject to regulation and laws, you need to know that you could be profitable at a lower ROAS. 

Francois Marchand: Perfect. Thanks for breaking that down for us. We do have a lot of content on the Ecomm Manager website if you want to look at how to calculate certain KPIs, which ones matter for your business. I suggest you go to the Ecomm Manager website, hit the search bar, look for the figure or the KPI you’re looking for, and we probably have an article about it. 

Jonathan, before I let you go, the last thing I can ask about, this topic of agencies and campaign management is how can an ecommerce company measure the true success of its partnership with a digital campaign agency?

And I mean, we talked about calculating return on investment and, lowering your cost per acquisition and all that stuff, but what’s the true measure of the success of a relationship with an agency?

Jonathan Naccache: Yeah, that’s a super tough question, but a good one. Numbers are important, it needs to be profitable and it needs to work for you, but it’s not everything.

And you could be with an agency that’s hitting numbers, but they’re not delivering on strategy, advice, innovation, so that you can get to the next level. And that’s when it’s time to consider a change. And all agencies will fall in that trap. So, it’s up to both parties to challenge themselves and challenge each other to keep that going, to keep the fight going.

Because when numbers look good, that’s when some people might get lazy. So that for me is the true measure, assuming results are being hit. If results are not being hit, then, you have to assess the quality of the advice that you’re being given and you got to try different things. At the end of the day, you can’t fund mistakes forever.

Francois Marchand: Perfect. I think that’s great advice. And I think everybody could benefit from everything we’ve talked about today. Jonathan, thanks again for being here. It’s been such a pleasure to have you on the podcast. Before I let you go, what’s your number one piece of advice for any ecommerce manager out there based on your experience?

Jonathan Naccache: Ooh, I’m going to try to keep that short because I can go on for another 30 minutes for sure. I’ll leave the hiring and agency part out of it because it’s not exclusive to that. A product needs selling and, it’s easy to forget about that when we’re on a screen all day, whether we’re a business or a consumer. But at the end of the day, people need convincing, they need follow ups, right?

Your dentist will follow up with you for your implants procedure or your Invisalign procedure. Your lawn care company will follow up with you, will try to upsell you, will show up at your door and tell you why you need lawn care, and they’ll overcome every objection before you even think about it.

And that’s what you need to do on your website. The number one thing I see is this information being dispersed across several pages over a website, a collection page of product that is doing no selling, you have to click through to get to the information. Users are no longer looking for information has to find them before they think of looking for it.

And if you have that mindset, pretend your website is a salesperson in person. What would you do when you’re talking to another person face to face and you’re trying to sell your product? What would you say? And try to reproduce that on your website in a visually appealing way, of course.

Francois Marchand: I think you’ve sold me. So you’re a great salesman. 

Jonathan Naccache: Thank you. 

Francois Marchand: Jonathan, where can we follow your work online if people want to catch up with you? 

Jonathan Naccache: Yeah, well, I try to do as much of these sort of things, this podcast. I try to write on different blogs. So I would say start by Googling Webistry, or Jonathan Naccache and you’ll probably find a bunch of stuff.

Francois Marchand: Jonathan, awesome. Thank you so much again for being here. Great advice. 

On that note, I want to thank you, the listener out there, for tuning in to this episode of the Ecomm Manager Podcast. Your support is so appreciated. And if you liked what you heard today, please don’t be shy. Leave us a review, comment, let us know how we’re doing.

Don’t forget to subscribe to the podcast to be the first to know when we drop a new episode in your feed. Until next time, I wish you all the best in your ecommerce journey. See you later.