Today I’m happy to have Derek Pankaew on the show. Derek is someone who I met at the Ecommerce Fuel Live conference and it was pretty random how we started talking.
I was sitting directly behind him during a session and I couldn’t help but peek at his screen. And I found that the screen saver on his computer was a running count of his age. I took notice and we started chatting.
And as luck would have it, Derek was selling t-shirts at the time and making a killing doing it. Now if you’ve followed my blog for a while, an example that I use of what not to sell is t-shirts because it’s way too saturated.
But Derek has made over 600K with a gross profit of 335K selling t-shirts online in a pretty short period of time and in this interview he shares how he did it. Enjoy the episode!
What You’ll Learn
- How Derek came up with selling tshirts online
- What was special about Derek’s tshirts that made them sell online.
- His motivations for starting his business.
- How and where Derek advertises his t-shirts.
- Which sales channels worked for his business and which did not.
- His primary source of customers
- The challenges of selling t-shirts as a sustainable business
Other Resources And Books
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Now if you enjoy this podcast, please leave me a review on iTunes, and if you want to learn how to start your own online business, be sure to sign up for my free 6 day mini course, where I show you how my wife and I managed to make over 100K in profit in our first year of business. So go to mywifequitherjob.com, sign up right there on the front page, and I’ll send you the mini course right away via email, now onto the show.
Welcome to the My Wife Quit Her Job podcast. We will teach you how to create a business that suits your lifestyle, so you can spend more time with your family, and focus on doing the things that you love. Here is your host, Steve Chou.
Steve: Welcome to the My Wife Quit Her Job Podcast. Today I’m thrilled to have Derek Pankaew on the show. Now Derek is actually someone who I met at the eCommerceFuel Live Conference, and it was actually pretty random how we started talking. Behind one of the sessions I was sitting directly behind him, and I couldn’t help but peek at his screen because it was like right in my face.
I found out that the screen saver on his computer was like a running count of his age, and I took notice of that and we just started chatting. As luck would have it Derek was selling t-shirts at the time and making a killing doing it. Now if you’ve followed my blog for a while, an example that I use of what not to sell are t-shirts because it’s a really saturated industry.
Now Derek has actually made over 600K with a gross profit of 335K selling t-shirts online in a pretty short period of time which is pretty crazy to me. Anyway Derek is working on a lot of different projects right now, but I kind of want to dig deep on how he managed to make such large profit selling t-shirts online. With that welcome to the show Derek how are you doing today man?
Derek: I’m doing great, how are you doing Steve?
Steve: Still have that screen saver or has it changed?
Derek: Let me check how … It’s turned off at the moment, but I liked it. I’ve already turned it back on now that you reminded me.
Steve: I think it was in seconds or something like that, so I had to calculate like what your age was, I don’t know…
Derek: Yeah it’s a really good reminder for me of my … The short time I have on this planet and most of it.
Steve: I’m curious here, how did you come up with selling t-shirts and what was your secret sauce that allowed you to sell so many online?
Derek: How I came up with selling t-shirts, I was living in Vietnam at the time. I met someone else who was doing this business pretty successfully. He actually got out of the business, and we were just chatting and I was like, “Yeah, what do you do?” He told me what he does and he said he just finished selling t-shirts. I was like,” Selling t-shirts? How is that going?” He was like,” Yeah it was good. I made maybe like 20K, 25K a month.”
And I was like,” What? What were you doing?” So then he told me about the business model. I had done some Google AdWords in the past, and I figured Facebook ads couldn’t be that much different. After talking to him for a bit I went home. I started researching this business model, bought some courses around Facebook ads and taught myself Facebook ads and then took him out to dinner again.
I had more specific questions this time, and then after having a couple of conversations with this guy who has done it before and then spending sometimes studying on my own, I just started launching campaigns. What was the second question?
Steve: So let’s back up a little bit because a lot of people aren’t really familiar. I mean we’ve chatted for a while but … so first off how did you obtain these t-shirts, how did you get the designs, and that sort of thing?
Derek: Okay great, so I was selling mostly on a platform called Teespring, which allows you to upload designs to this platform, and they will print the shirts and send it to your customers for you. I don’t have to deal with customer service; I don’t have to deal with fulfillment. All I do, there is basically I have 2 jobs, one is to get the designs up, and the other is to market the designs.
So the marketing is almost 100% Facebook ads, basically it is 100% Facebook ads. I tested some other things like Pinterest ads, but for the most part the whole business was basically built off of Facebook ads. As for where the designs come from, they actually come from a ton of different places. So some of it is through competitive research, so I’ll use tools like TeeGrasp is probably the number one tool in the t-shirt …
Steve: What does that tool do?
Derek: It scrapes all of the different t-shirt websites. It scrapes Teespring, it scrapes Teechip, it scrapes Gearbubble for all the t-shirts that are launched on those different platforms. It lets you see what markets people are in, what kinds of designs are selling well. Using that tool I’m able to come off with offshoots. If a design that said beware of the crazy chicken lady is selling well for chickens, then I might think of beware of the crazy goat lady for women who have goats. Using offshoots of existing designs by using spy tools this one method, once…
Steve: Oh backup, on Teespring do you get all the revenue numbers for everyone who is selling t-shirts?
Derek: No, you see the sales numbers for everyone who is selling t-shirts and you can extrapolate to the revenue numbers from that.
Steve: Okay, because the t-shirts are like 20 bucks probably, is that…
Derek: Yeah, typically really simple designs are about 20 bucks, and then if there is multi colored front and back print and you are looking like 23, 24.
Steve: So you really know how much someone is making, right?
Derek: On Teespring yes you can have a pretty good guess. The numbers do change because if you are selling hoodies … You are usually able to sell a few different kinds of shirts at once. If they are selling hoodies the margins are a lot higher on hoodies, and you can’t really tell what the split is between the t-shirts and the things they are selling. In other platforms such as Teechip will actually let you hide the amount of sales you are getting. On Teespring you can figure out the revenue approximately, but on some of the other platforms you can’t.
Steve: Okay, and then some of these research tools that you are mentioning would you mind talking about what they are and what they do exactly?
Derek: Sure yeah, the 2 most common ones that I’m aware of are Teegrasp which this tool is like a Google spider. This tool will go to all these different websites and just see these t-shirts and it will take a screenshot of the front and a screenshot of the back. If the number of sales is publicly available, it will grab that data as well and then compile all of it in the spreadsheet.
If I wanted to go in the market for example we use chickens. I could go into Teegrasp and just type in chickens, and it will show me all the shirts that had been launched in that market before. What percentage of the campaigns have hit, meaning it had at least enough to print. How many shirts…
Steve: And what is that number?
Derek: I believe it’s 3.
Steve: Oh that’s it, okay.
Derek: I have actually been out of the Teespring business for a little while now, so I don’t actually know if they updated that. They were talking about making it one, but last time I was in the business it was 3.
Steve: Okay, and so these tools, are they free or do you have to pay for them?
Derek: So Teegrasp is not free, I think it’s 50 … somewhere between $50 and $100 a month. Another tool that I use was just Pinterest. Pineterst.com/source/Teespring.com, and they’ll give you a really, really good live feed of what’s being shared the most on Pinterest from Teespring. That has a really close correlation to what’s selling really well.
You can just replace Teespring.com with all the other sites that run it, so Teechip.com is another big website that sells t-shirts. Gearbubble.com, so you can just replace that and spy on a lot of different websites that are currently selling t-shirts, so Pinterest is free obviously.
Steve: You go through and you find out what the best selling shirts are, and then you make little offshoots of them. Are there any copyright issues with doing that?
Derek: That’s only one of the sources that we use. I’d be really careful about the copyrights so I wouldn’t copy the design, I’d only copy partial quotes. Often times the way I would use these tools is to identify markets. If we use chicken again as the example, if I see that chicken people who have chickens in their backyards and are really passionate about raising chickens are buying t-shirts, then I might … Once I figure that out using these kind of competitive intelligence tools, I would just go to Google images and type in like funny quotes about chicken. Chicken means, funny chicken weird or whatever just start looking for weird quotes.
Often times we’d actually … This wouldn’t work for the first or second t-shirt that we do in a market. By the time we are on our third, fourth, fifth t-shirt to the same market we start to build a Facebook page that has some following. We are able to just start posting these images, the memes that we see on Google images. Or we also look on Reddit and a couple of other places. We just post these to our existing audience and we see which ones get the most likes and the most comments and we turn those quotes into t-shirts. We use a live feedback mechanism as well.
Steve: Just curious, how many t-shirts sales would actually interest you to go into a certain market?
Derek: I probably want to see a campaign with at least probably at least a 100.
Steve: Oh okay, so not that many really?
Steve: Okay so if you see like a t-shirt that sold more than a 100 units, that would be something you would consider going into?
Derek: Yeah absolutely. One thing too, one really important thing to realize with Teespring is that it’s a really, really high volume game in terms of the number of designs you need to put out to do this well. On a weekly basis we are launching 40 to 50 different designs.
Steve: Holy crap okay, so we are talking like … oh my God that’s a lot of designs every day.
Derek: Yeah totally, and most of them will fail. Like 9 out of 10 will not just make any money, and 9 out of 10 will lose money. The 1 out of 10 that makes money will more than make up for the ones that lose money. When I say that if I see that a shirt has done 100 sales in that market that’s really … That’s good enough for me to spend 1 out of 50 of my experiments on a weekly basis on that market to see if it sells.
Steve: So is your team like all graphic designers?
Derek: The team was 3 graphic designers, 1 assistant who was helping with Facebook ads and 1 assistant who was helping with all the other menial stuff, answering comments, creating Facebook pages etcetera.
Steve: Okay, and so you were creating designs from scratch then. You’d come up with an idea and a quote, and you’d have your graphic designer pout together some sort of graphic and integrate that quote in?
Derek: Yeah, so a lot of these quotes were very were scalable or tempertized. The quote I mentioned earlier beware of the crazy chicken lady. You could replace that with literally 30 different animals, right. Often times off of the 40 or 50 designs we were doing a week there were actually maybe only like 3 or 4 unique designs, and we are just scaling them out to different markets at the same time, does that makes sense?
Steve: Yeah totally, okay and so this Facebook page that you were talking about. That Facebook page obviously only caters to a very specific niche, right?
Steve: So did you start that Facebook page right from the start and start posting to it?
Derek: So in the beginning I ran everything out of one Facebook page, so I was running 50 different markets out of one Facebook page. Until someone told me that if you do that, any other Teespring marketer can just come to this page and see all the markets you are in. After that point, the practice really is, the best practice in Teespring is to have one page for every market you are in.
Once I started doing that, yes, we would create a Facebook page for every single market we are in from the very beginning, even if we didn’t know if we would sell anything. Then, but we wouldn’t post any content to it until we are starting to make sales. Once it’s clear that this market is going to be profitable for us that’s when I started putting content on the page.
Steve: How often would you post to this page? You just had this blank page until you knew that the t-shirt was going to sell and then you started posting to it.
Derek: Yeah, actually we only built … There were only 4 pages out of maybe; we probably tested like 300 different markets. We only built 4 pages where we were posting regularly, because it is a lot of effort to find a bunch of post. We can’t just post images. We have to actually write a couple of sentences with each post. It’s actually quite a bit of effort to run these Facebook pages.
We were posting about 5 times a day, so about 35 posts a week because most of the audience … The Facebook formula for reach is, you will reach 4% of your audience for a post or something like that. Even though we were posting 35 times a week, people were probably only going to see our posts twice a week anyway.
Steve: Did you buy likes in the beginning or was it all organic?
Derek: Yes, for the pages that we are actively building, we did buy likes and for the rest we didn’t. In retrospect I don’t think it’s really worth it.
Steve: Interesting. Okay.
Derek: Yeah, I don’t think it was really worth it.
Steve: How do you jump start the page then?
Derek: A lot of people actually like the page, just from … If we run a t-shirt campaign and we spend $5,000, $8,000, $10,000 on the Facebook ad campaign, and that ad is seen by 100,000 people or whatever. A pretty good portion of them will just like the page from the ad itself. If we are, after we spent a few thousand dollars on ads, we’ll probably have a thousand likes, couple of two thousand likes just from people who like t-shirts and want to have … If you are a big fun of chickens and you are really passionate about it, and you see this t-shirt that’s hilarious.
It’s an inside joke for you and your people, then you might just like the page and like see what other t-shirts they come up with in the future.
Steve: Okay, and then with this page then, did people kind of engage with the page later on? How did you use this page later on once you got a little bit of traction? Actually first of all how many fans did you for your highest page, how many fans did you get?
Derek: About 38,000.
Steve: Okay, that’s a pretty good number of chicken lovers there. How did you use this page once you had it established?
Derek: A lot of it was posting, so posting these images, these memes, these quotes and seeing what people respond to. The best campaign I ever did sold about $33,000 in gross revenue and about $22,000 in net profit. That came from just a quote that got insane engagement. We were just posting it and for me I would never have guessed this quote would do so well. This quote got like 10 times more engagement than anything else we posted.
Then I took that quote and went to 99 designs and paid a lot more than I normally pay for design. Usually I’m paying like $15, but I paid $250 for this design. That just … It was a really good design. It just took off. It was the highest seller I ever seen. Yeah, just posting quotes to the page …
Steve: Are you going to tell me what the quote is or what? Or is that a secret?
Derek: I’d rather not share that in particular.
Steve: Okay, that’s fine.
Derek: Let’s see, where were we? Oh yeah how to engage. Just posting quotes and getting responses from people, using that to gauge what kinds of quotes to put on t-shirts in the future. Actually I think, I don’t have any way to quantify this, but I think in the markets where we are actively posting because we are showing up in people’s newsfeeds more often, it actually increases our conversion rate. There’s like a branding effect to it. I can’t really quantify that in any casual way.
Steve: Sure, were these shirts branded even though they were sold on Teespring, or there’s no branding at all?
Derek: Not really. The brand is just our Facebook page, I think people just get used to seeing it.
Steve: Okay. Let’s shift gears a little bit and talk about the bread and butter of this business which is the marketing side. You bought, you obviously spent a lot of money on Facebook ads, and I was hoping you could just kind of walk me through the strategy that you used to market these t-shirts.
Derek: Sure yeah. The goal with this, there’s kind of a 2 problem goal. There is, first you want to cast your net wide while keeping it to the most passionate people possible, and I will explain what that means in a second. Second, you want to use a very data driven approach to eliminate all the places where you are wasting money.
Coming back to the chicken example, typically I would separate everything. I would start with anywhere between 3 to 5 ad sets. An ad set for anyone who doesn’t know it’s just a grouping in Facebook ads of different keywords, different interests that you can target. I would put similar interests into the same ad set. I might target at magazines. Magazines is one that tends to convert really well, and I would just list off a few different groupings that I frequently target. Magazines is one, websites is one, suppliers, manufactures and tools is another one, organizations is another one. Those are …
Steve: What about celebrities, do you target celebrities?
Derek: Celebrities? So if there are authors, or speakers, those could do really well. If they are like if I was in the golfing market, I definitely wouldn’t target like Tiger Woods. If I was to target a celebrity I would make sure it’s like a number 8, like b-list celebrity. Not the top 10 golfers, but like the 33rd golfer so that only people who are super passionate about golf would be liking this person. Even that said, in my experience celebrities don’t, those interests don’t convert that well. Typically I wouldn’t test that until I was like scaling a campaign that’s proving to convert.
Steve: Okay. One question I did want to ask, when you are writing these Facebook ads, you get conversion data from Teespring, right that directly correlated?
Steve: Okay. Can we just take your chicken example for example and then just tell the audience how you would put together an ad set for it.
Derek: Sure. First I go to Google and I type in chicken magazines. It will pull up I think backyard chicken is the name of a magazine. Chicken farmer I think, I don’t know if that one’s actually a real one. There’s usually maybe 3 or 4 magazines in a market. If it’s a really big market there might be like 5 to 10 magazines.
I would just put all those in one ad set. Next I would look up the most common tools you would need. With chickens it might be bird feed, chicken coops, cages like whatever those supplies are. I look up the names of those suppliers and I would click that into a Facebook ads. I look for the most high trafficked or the most engaged websites. I don’t remember actually what those websites are in the chicken market.
Steve: It’s okay.
Derek: Whatever they are, the websites that the people tend to frequent, and then organizations. Chickens might not have it, but for cattle for example, you have a Cattle Farmers Association, the American Beef Association. Whatever the associations that people who are in that market would tend to join, just put those all in one category. Typically I would have … Hold on, give me one moment. I’m just going to look up if there’s any other ones I missed. Typically I would start with 3 to 5 different ad sets. Each of those I would further cut those in half, and half the traffic would go to mobile and half the traffic would go to desktop.
Steve: Okay, and do you factor by age also or segment by age?
Derek: I don’t segment by age in the beginning. I will do that later on, but in the beginning I would just … I usually start at about 30 years old and go to 65 plus. I found that for t-shirts, people between 18 and 30 don’t really buy. They buy but I usually end losing money. I think my guess is that they just have less money so they are not as …
Steve: Do you ever use any of the ones who are you only want to target people who make over a certain amount?
Derek: No. I think that data in general isn’t very good because most of the data that Facebook gets is given to Facebook by the user. You type something in your status and Facebook knows you’re into chickens because you are posting photos of your chickens or talking about your chickens. The financial data they are buying it from third party sources and then trying to correlate it to your Facebook account. I think in general that data is not all that good.
Steve: Okay. Your first ad really is just interests … The categories that you are talking about for your ad sets and then just half mobile, half desktop, that’s your first campaign.
Derek: Yeah, interest 30-65 plus half mobile, half desktop. We are still targeting people who are really passionate about this topic but we are casting a wide net.
Steve: What about how many creatives do you make and how many headlines and that sort of thing also in your first iteration.
Derek: Just 1 and usually actually throughout the whole campaign, we typically just have 1 ad. Remember we are launching 50 campaigns a week. In each ad is an image that has to be made in Photoshop. If we are doing multiple ads it would just add a ton of time to our process. Just to keep things scalable and running smoothly. We just did 1ad basically.
Steve: What is your image? Is it just a picture of the t-shirt?
Derek: Yeah, it’s a picture of the t-shirt blown up as large as the image will allow which is like color on the background. Sometimes like a border around the shirt, like a stroke to make it stand out from the newsfeed a little bit more.
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Steve: Okay, any text on the image at all?
Steve: What would your headline look like then?
Derek: There is no headline. The format of the post that we were doing was … It’s a little bit different than … The normal Facebook ad is 1200 pixels by 628 pixels. It’s kind of like a horizontal rectangle and if you click on it goes to a website. Most of the stuff that we were doing with TeeSpring we were actually doing 1200 by 1200 so it’s a much larger ad. We posted on our Facebook page and then we used that creative as the ad.
There’s actually no, there’s no headline on it. It’s like if you see a friend’s post with an image on it, there’s no headline on it. It looks exactly like that except it’s Facebook ad. It’s a slightly different format that we were using.
Steve: Okay. Cool. You found through experimentation I would gather.
Derek: Yeah, it was kind of industry standard too.
Steve: Oh it was, okay.
Derek: Because it’s a t-shirt just having more screen real estate from the bigger size of the image, tends to work better for … At least I found when I did it tended to work better than having the half the size.
Steve: Okay, that makes sense. It’s just literally like a picture with no headline underneath the image and then just some text above it.
Derek: Yeah, exactly and the text above it would say like limited run, campaign ends in ten days, new shirt for chicken, new shirt for chicken farmers available in 5 different colors. Just kind of hypie time’s running out kind of text.
Steve: Then how much money would you put on each of these ad sets in the beginning?
Derek: In each of these ad sets, Facebook has changed the policy around this a little bit. We used to be able to put any amount of money we want on it. Now there’s a $5 per ad set minimum generally unless you tweak things. When I was doing it, I was basically dividing $15 among all the ad sets. If we were doing 3 ad sets and then split those in half, so that there’ is 3 desktop and 3 mobile, then I would just divide $15 amongst the 6 ad sets.
It would be $250 a day for the initially test. Basically what I was willing to do, I would be willing to spend $15-20 dollars on a Facebook ad set to see if it would make a sale or not. Usually what I find is that by the time I campaign, I spend $15-20, if it hasn’t made one sale, it’s probably dead. If it’s made 1 or 2 sales, it’s in limbo. I have no idea if that’s going to make money or not. If it has made 3-5 sales then it’s probably a winner.
Steve: Okay so a couple of clarifications here, all these ads go straight to the TeeSpring page of that t-shirt where they can checkout directly. There is no landing page or anything it just goes straight to the checkout page.
Derek: Yeah, that’s right.
Steve: How much traffic can you possibly get of $15 worth divided amongst 6 ad sets?
Derek: Like how many clicks, or what do you mean?
Steve: Yeah, how many clicks and what is a good conversion rate?
Derek: The conversion rate is anywhere between 8-13%
Steve: Wow, that’s crazy high
Derek: Yeah, it is pretty high, but again we are only hitting 1 out of 10 designs. The ones that hit, yeah they really resonate with the market. I actually don’t know how many clicks I get; I don’t think that’s something I looked at on a regular basis. I just looked up the ad span versus revenue.
Steve: Okay, I was just curious, I mean it’s probably somewhere in the order of 20 cents to a dollar maybe per click, I don’t know. That’s sounds too high actually for, to get there.
Derek: I think I was generally paying a little bit over a dollar per click actually.
Steve: Really? Okay
Derek: On an account wide basis, but that, actually now that I think about it, on an account wide basis that would include the shirts that were losing money as well. I actually don’t know how much per click I was paying for the ones that were making money.
Steve: On your bidding, did you just let Facebook bid by purchase? Yeah got it. Okay, so you get some data, and certain ones are dud, certain ones are in limbo and certain ones are kicking butt hopefully right?
Derek: Yeah exactly. I’d spend, usually if I spend $15 or $20 in day 1 I would scale that up to say $50 in day 2 and $100 in day 3, and then $150 $200 on day 4. I know that’s a lot faster scaling than a lot of people in Facebook ads advocate. I think standard in Facebook ads is to raise your budgets by 50% every 3-5 days. TeeSpring is a little bit different, I think because you are literally in a race against other people.
If you have design that is selling well using the tools that we talked about earlier, people can see what is selling well, and you will literally have 4 knock offs within 2 days. It really is, like once an idea is in the sphere of t-shirt marketers, you are just in a race to spend the money and get it in front of every single person in that market, and capture all the sales before somebody else knocks you off.
Steve: That sounds really like cut throat to me. All right, what do you do with the limbo designs; do you scale those as well?
Derek: Yeah, I spend a little bit more money. I will just let it keep running at $20 a day. Yeah basically I will just …
Steve: You mentioned segmenting by mobile and desktop, can you share some of your experiences with that. Like are most of the sales on mobile or back when you were doing it?
Derek: It’s completely market dependent. Some designs will sell on both, some designs will not sell on desktop, and some designs will not sell on mobile. I haven’t found any coloration, I can’t guess. I can’t say older people tend to buy on desktop, artistic people on mobile. Literally I cannot guess what it is, but some markets bind it on different devices and I don’t know why.
Steve: Okay that’s very interesting. In a typical test like the chicken one that you described, do you have this 6 ad sets, you ever have cases where all of them are bad and you just go back to the drawing board, or is that the common case?
Derek: That’s really a common case. I won’t try and revive things that are making money, if it doesn’t make money after … if I spend $20, like one sale I’m usually making $8-$12 so if I spend $20 even if I made 1 sale I’m actually still losing money. If I spend $20 and I make no sales, I just dump it.
Steve: Let’s say you have a couple of mediocre ones; walk me through that process. Let’s say you’ve made one sale in your $15 experiment?
Derek: Probably I will just let spend another $15-30, and just check it daily. Sometimes what will happen is it will make 1 sale and after I spend another $20 it will suddenly jump to let’s say 6 sales, if that is the case, then great. I will keep running it; often times what happens it will just break even or lose money. By the time I spend $50 and it’s not making money then I will probably kill it off.
Steve: Sound like your threshold is 2 per day, is that 2 per $15 is that accurate?
Derek: I didn’t understand the question can you …
Steve: Meaning like you need to sell at least 2 to be profitable, from what you were saying?
Derek: Yes, that’s right.
Steve: At a $15 per day clip. As long you are making at least 2 per $15 spent you will just scale it right?
Derek: The important thing, the reason I do it this way is because it’s actually more costlier to miss a winner than it is to spend money on the losers. If I spend $15 on it and it makes 1 sale, I’m losing a bit of money. If I spend another $15, I might lose another additional $15, but if that was actually a winner. A winner can make anywhere between $500-$20000. If it was actually just a statistical fluke that it didn’t make a bunch of sales off the first $15 and I killed it too early I could literally have just lost $10000. That’s why I let myself bleed out a little bit more money just to make sure I’m not missing out on the winner, does that make sense?
Steve: Yeah, it totally does, just curios, how big are these audiences and do you ever burn them out quickly?
Derek: All the time. How big are the audiences? Anywhere between, the smallest market I ever did, I’m happy to share what this market is. The smallest market I ever did was female space ship engineers.
Steve: Wow that is a really, okay, that’s like nothing.
Derek: Yeah, that market I think only had about 2000 people I could target on Facebook. I spent $3000 and I made $4000 back. It was a super high return on ad spend, but I burnt out the audience within a week or 2. The largest audience I think I targeted was 650000 people. I’d say anywhere between low thousands to high hundreds of thousands. I don’t think I have ever gone larger than a million.
Steve: Okay, It sounds like these t-shirts don’t really have lime a long life span, is that accurate?
Derek: That is probably accurate. I have heard of people, and I’m probably leaving money on the table by not doing this, but a lot of people will, once they burn out a design, by burn out I mean that the ad had a frequency of 2 and usually that’s when it stops working. When everyone in your industry has seen that t-shirt twice and hasn’t bought, that’s usually when you start losing money.
By what I have heard a lot of people doing is they would run the shirt and then 3 or 4 months afterwards they would run it again, and it would be profitable for them. Yeah, typically one t-shirt campaign will last anywhere between 1 week to 2 and a half weeks. That’s probably pretty standard.
Steve: Sounds like there is a ton of maintenance. You have to pump up out new creatives all the time and it sounds like you’re constantly turning these out every single couple of weeks. It’s not like you have a winner and you can ride it for a year longer, is that accurate?
Derek: Yeah, that’s accurate. You definitely can’t ride a winner for a year. That would be amazing but yeah.
Steve: Are you allowed to re-target. Does TeeSpring let you put pixels on the landing pages and stuff or …
Derek: Yeah, you can retarget.
Steve: Okay, so do you do that?
Derek: Yes, we are targeting otherwise really high, definitely recommended.
Steve: Did they let you gather emails?
Derek: No, but you can send emails to their customers through their systems. I do know other people who they put a landing page in front of the TeeSpring page. It will just be the image of the design and then put your email here to receive a $5 discount or whatever. Yeah if you want emails you’ll have to collect them yourself. There are other platforms. Teechip for example if you sell through their platform they will let you export all the emails from customers.
Steve: Did you go that route as well?
Derek: I didn’t, I just never … My impression of Teechip is that, they have worse printing and worse customer service, and for me the interface as the marketer was worse as well. I just didn’t want to do it.
Steve: I was just thinking that, if you had that landing page like you said that people do and what you gathered a list of like crazy female space ship engineers, you can continually pump out designs, and just email them to them, right?
Derek: Yeah, an actually I think a lot of the TeeSpring people are moving that way, and actually moving off of TeeSpring and starting their own Shopify stores. Selling t-shirts still, but in specific markets, building their own audiences and building more of a brand.
Steve: Everything is Facebook then. Google doesn’t sound like it would work that well, because people aren’t really searching for female space ship engineer t-shirts right?
Derek: Yeah, I haven’t heard of anyone doing this, but I think that Google display network could actually work. I never tested it. I did test Pinterest ads which actually converted pretty well but the volume was really low compared to Facebook ads. I was just, you couldn’t spend any money, but the money you could spend would return pretty well.
Steve: In terms of lookalike audiences, were you doing that as well?
Derek: Yeah, I found out look alike audiences off of clicks didn’t really help that much. Once we have enough buyers, which is usually about … Technically you need 200 buyers that show up in the Facebook pixel which means probably about 300 actual buyers. Once you have enough buyers to make a customer audience, and to create a lookalike audience, I found that does converts pretty well.
What worked best for me was using that lookalike audience and then just putting a broad keyword on top of it. Let’s say I was targeting fencing for example, people who fence, I would probably not just target fencing if I didn’t have a look alike audience, but if I had a look alike audience, I would just lay a really broad key word on top of it and that would work pretty well. I have heard of people just using them naked lookalike audience. Just look alike audience with no interest. That never tested well for me personally, but I have heard that can work pretty well as well.
Steve: When you start incorporating this stuff into your ads, you stared out with your 5 or 6 ad sets, when did you incorporate lookalikes into the mix?
Derek: That’s pretty late actually. The next step, once I have tested the campaign and it’s converting well, I’m starting to scale up, I will start checking on a day to day basis the breakdowns which is are male or females buying, what devices, what countries are they from, what regions of the country are they from, what age range etcetera.
This I’ll start checking by the time I’ve spent, probably by the time I’ve spent $50 because often times you will see it really early. You will see that I spent 50 bucks, I have made 9 sales, and literally all 9 of them are from women. That stuff, sometimes you see it early, sometimes it takes a few hundred dollars. For me to start using look alike audiences, I’m probably looking at least $1000 in ad spend before that really comes in play.
Steve: Okay, that’s like half the life cycle of your entire campaign right?
Derek: No, there are some campaigns that can get pretty high in spending.
Steve: Okay, let’s back up a little bit, when did you start refining your interest, at what point do you start doing that? Or the demographics I
Derek: I’d say by $40-$50 in spending. I won’t always be able to make any decisions at that point, but I’ll at least start looking at that point.
Steve: Okay, of the campaigns that have been successful, do you create a new ad set or do you just change the existing one?
Derek: I turn off the ones that are not making any money, and the ones that are making money, I will do 2 things. Often times I will break them out. Let’s say I have 6 magazines all on 1 ad set, I might turn off the magazines ad set or I might leave it running, and just break all the 6 of them into their individual ad sets, so I can see which magazine specifically are converting.
I will go look for more stuff as well like magazines. I’ll usually find all the magazines but if their websites for example. I might only have found the top 3 or 4 websites in the industry, but if I’m finding that websites are converting well, I might just go look for all 20 of them, and maybe only 9 of them will show up in Facebook ads as targetable. I will just go look for more of the same stuff that’s converting, if that makes sense.
Steve: In the case where it’s only females that are buying will you lay that on top of these existing ad sets?
Steve: Interesting, and then, let’s say there was like 3 males and 7 females, would you still run the males like a lower spend?
Derek: If it’s profitable, yeah, just like if otherwise positive I will let it run, why not.
Steve: It sounds like a lot maintenance here. Are you using any tools, or are you using any tools to help maintain your Facebook ads, or was it all just power editor?
Derek: It’s power editor and Google spreadsheets.
Steve: Google spreadsheets wow, okay. I had this question written down here, what are the challenges with this model, and it seems pretty clear to me that it’s just really cut throat and you constantly have to be churning out stuff, because there’s not anything that is going to last a long time.
Derek: Yeah, I think that’s true, and I think if I were to do it again, I would definitely be building a store, I’d be collecting an email list. I would break off of TeeSpring. TeeSpring actually does fulfillment now. You can have a Shopify store and they’ll print for you. I would still probably have started with TeeSpring because I wouldn’t have known what markets were converting well for me, but by the time I knew what markets were converting I would have definitely moved away from selling on someone else’s platform and built my own.
Steve: Earlier you weren’t willing to reveal like that coach, or that really popular shit, does that imply that it’s still selling?
Derek: I thought about, I haven’t turned it back on, but I imagine that if I just re-ran the same design it would actually make few thousand dollars.
Steve: Okay, and there is hope, right? Once your 2 week campaign or whatever is over, you can just run it again at some future time, like during Christmas time, actually how much does seasonality play in this business?
Derek: I think it actually plays quite a lot. I don’t think, I think year round there is decency as always, but around Christmas is just ridiculous. We did over 100K in sales in a 30 day period, and people are just buying during that month. I think TeeSpring’s still are really a good business not around Christmas, but yeah there is definitely a huge bump around Christmas.
Steve: Okay, and in terms of just copying, do people just copy you over verbatim sometimes?
Steve: Is there anything you can do about it?
Derek: On TeeSpring, yes. TeeSpring, email them and say, “Hey this is copyright infringement.” but there is so many platforms. There is, like I mentioned Teechip, Gearbubble. There is literally a dozen out there. The biggest 3 or 4 care about copyright, but the little ones, they don’t care. If you get knocked off and it’s on some random website with, not a strong legal team, I don’t think there is much you can do about it.
Steve: Okay, Derek, you mentioned that you stopped doing this a little under a year ago, what caused you to get out of this business, and what are you working on now?
Derek: What caused me to get out of the business was I don’t think I built my team in a stable and scalable way where I could not be doing a lot of the Facebook ads work. Basically I hired people around where I was living in Thailand, and a lot of them were travelers, a lot of them were entrepreneurs working on their own stuff. After a few months they would naturally leave and it was just really unstable, the team I built, and I decided to try and rebuild the team using Filipino virtual assistance.
I flew to the Philippines, I hired a couple of BAs and I trained them on how to use the system I was building, and it turned out that as soon as anything changed in Facebook ads or on TeeSpring, they have to be retrained over again because weren’t actually … They didn’t have a deep understanding of Facebook ads. Basically I made some mistakes in hiring and building the team.
The reason I closed it down, as we were talking about, to do this well we have to launch a ton of designs, it’s a ton of work. I was probably working 50-60 hours a week. I think by the time it was clear to me that the second team wouldn’t work out; I just didn’t have the energy to do it over again.
At the same time I had Amazon via supplements business that was starting to do pretty well, and I was working on another physical product. Design it from scratch and just, I had a lot of other things, some of them were starting to take off, and taking my attention, and I just decided, “You know what, it’s been a good run, but I don’t think I want to continue with the TeeSpring thing, and so dispose it.”
Steve: Have you found that FBA has been a lot less work for a greater return?
Derek: It’s so much less work, yeah. It’s literally the most passive income I have ever seen in my life.
Steve: Well, there is an endorsement for anyone out there listening. Private label stuff white label stuff on Amazon using FBA. Although supplements is pretty competitive, right?
Derek: Yeah, it is pretty competitive.
Steve: We don’t have that much time left, but is your strategy similar? Do you run Facebook ads for your stuff or are you … Is it just giveaways, how do you market your supplements?
Derek: Yeah it’s giveaways and Amazon PPC. Typically I do a little bit of over 20K a month. I’m not the biggest seller in the world. I’m actually, hopefully a lot of my products are ranked somewhere on the bottom of page 1, top of page 2. I’m not in crazy bidding wars for the top spot. I just launched products and I’m happy to be in the middle, if that makes sense.
Steve: Yeah, you are like under the radar, so to speak. Making a pretty good income, especially since you like to travel to Asia all the time where the cost of living is really low.
Derek: For sure.
Steve: Cool man, hey Derek I learnt a lot about the t-shirt business today. I had no idea that so many people were making money selling t-shirts online. I thank you for that. If anyone has any questions for you, I don’t know if you have a blog or anything, but where can people find you?
Derek: I don’t have a blog, they could email me. I’m pretty open to email in general. My email is DerekPankaew@gmail.com.
Steve: Yeah, I’ll link that up, and hey Derek thanks a lot for your time, I really appreciate it.
Derek: Your welcome, it was my pleasure.
Steve: All right, take care.
Hope you enjoyed that episode. In general when anyone comes up to me wanting to sell t-shirts online, I’m almost always 100% skeptical, but Derek clearly made it work, and it’s really interesting how you can leverage and base an entire business off of Facebook advertising.
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