Podcast: Download (Duration: 46:29 — 53.5MB)
Today I’m thrilled to have Jake Cohen back on the show. Jake is the product marketing leader over at Klaviyo and for the past month or so, he has been heading up a special Covid-19 Coronavirus task force to research, gather and synthesize e-commerce data to share with a broader e-commerce community.
In this episode, we are going to go over some hard data on how e-commerce stores are faring during this pandemic along with which industries are doing well, which are not, and how to improve your sales. We also make some predictions on the future of e-commerce.
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What You’ll Learn
- Which ecommerce categories are doing the best
- Which ecommerce categories are not performing as well
- How the ecommerce supply chain has been affected
- What sales strategies are working for ecommerce merchants
- How brands are feeling about the future of ecommerce
Other Resources And Books
Klaviyo.com – Klaviyo is the email marketing platform that I personally use for my ecommerce store. Created specifically for ecommerce, it is the best email marketing provider that I’ve used to date. Click here and try Klaviyo for FREE.
Privy.com – Privy is my tool of choice when it comes to gathering email subscribers for my ecommerce store. They offer easy to use email capture, exit intent, and website targeting tools that turn more visitors into email subscribers and buyers. With both free and paid versions, Privy fits into any budget. Click here and get 15% OFF towards your account.
EmergeCounsel.com – EmergeCounsel is the service I use for trademarks and to get advice on any issue related to intellectual property protection. Click here and get $100 OFF by mentioning the My Wife Quit Her Job podcast.
SellersSummit.com – The ultimate ecommerce learning conference! Unlike other events that focus on inspirational stories and high level BS, the Sellers Summit is a curriculum based conference where you will leave with practical and actionable strategies specifically for an ecommerce business. Click here and get your ticket now before it sells out.
But before we begin, I want to thank Klaviyo for sponsoring this episode. Klaviyo helps brands build relationships across any distance delivering email marketing moments. Your customers will appreciate, remember and share in good times and bad. And since it is all driven by real-time e-commerce data, you can make sure every interaction feels more personal. Now when you have a 360 degree view of the customer the growth possibilities are endless. So visit klaviyo.com/mywife and try for free. That’s KLAVIYO.com/mywife. Now on to the show.
I also want to thank Privy who’s a sponsor of the show. Privy is a tool that I use to build my email list for both my blog and my online store. Now, what does privy do? Well Privy is an email list growth platform and they manage all my email capture forms and I use Privy hand-in-hand with my email marketing provider. Now, there are a bunch of companies out there that are managing email capture forms, but I like Privy because they specialize in e-commerce. And right now I’m using Privy Display a cool Wheel of Fortune pop-up basically user gives your email for a chance to win valuable prizes in our store and customers love the gamification aspect of this and when I implemented this form email signups increased by a hundred thirty one percent. Now, you can also use Privy to reduce cart abandoned with cart saver pop-ups and abandoned cart email sequences as well on super low price that is much cheaper than using a full-blown email marketing solution. So bottom line, Privy allows me to turn visitors into email subscribers which I then feed to my email providers to close the sale so head on over to privy.com/steve and try it for free. And if you decide you need some more advanced features use coupon code MWQHJ for fifteen percent off. Once again that’s privy.com/steve. Now on to the show.
Intro: Welcome to the My Wife Quit Her Job Podcast. We will teach you how to create a business that suits your lifestyle so can spend more time with your family focus on doing the things that you love. Here’s your host Steve Chou.
Steve: Welcome to the my wife quit her job podcast. Today I’m thrilled to have Jake Cohen back on the show, now Jake is the product marketing lead over at klaviyo. And last time we spoke. We spoke about how to improve your email deliverability back in episode 228, but today we’re not going to be talking about email marketing or Klaviyo much at all instead for the past month or so Jake has been heading up a special covid-19 coronavirus task force to research gather and synthesized e-commerce data to share with the broader e-commerce community and the data that they’ve compiled is based on insights from over 30,000 customers and their sales activity along with thousands of survey responses
And I know I for one interested in how other shops are doing and I know my shop over bumblebee Linens has been down because our biggest customers are wedding and event planners. And right now no weddings are events are happening. So Jake really happy to have you on the show man. Welcome.
Jake: You are hired that was a fantastic explanation of what we’re doing and I appreciate the invite so we can share.
Steve: Well, Jake great to have you back. Can you just quickly remind the audience who you are what you are working on and why you decided to take on this initiative?
Jake: Absolutely. So I’m Jake. Hello. I work at klaviyo. I am right now working on product marketing which is basically trying to make sure that klaviyo explains itself in a way that makes sense to people And helps them understand what we do we change direction in terms of what we were actually focused on around March 17th. I think, you know things started to really get crazy in terms of everyone started to work from home. We heard a lot of e-commerce Brands just start kind of freaking out, you know sales are dropping. What do we do? And so we asked ourselves, you know, our job really is to provide value every day.
What can we do? That’s the most valuable thing for our businesses today and what we heard from them was listen, we just don’t even know what’s going on. So we can’t even we don’t know what to do with ourselves hour-by-hour because things are changing so rapidly and we said, all right, that’s the answer. We are going to allocate, you know, a substantial amount of our energy to be the sort of Clearinghouse the news source of what is happening in the world as it relates to e-commerce. So that Brands can have a steady reliable place to turn to understand what’s happening and we should provide them with guidance on what we think they should do so they can make the most informed and the best decisions for their brand so they can survive today and Thrive both today and tomorrow.
And I’m very proud of the team that we’ve assembled to do this the information that we’ve shared the site that we’ve spun up and I think the business is that we’ve helped it’s been really really fun to pull it together and we’ve learned a lot really quickly.
Steve: I mean, I can’t wait to delve into the data. But before you before we get to that, how does it work? Exactly and how are you collecting this data?
Jake: Yeah, so it started overnight with a little Google form that I put out on Twitter and I just asked I literally asked a bunch of e-commerce Brands. I was like what’s happening, you know, what’s going on with your sales, what’s going on with your supply chain what’s going on with your ad spend what’s going on with your web traffic and I got a hundred and 50 responses overnight.
Steve: Wow, okay.
Jake: and he said I said, holy smokes. I think there’s something out here and you know, we invested more on that and very quickly. We had like an open field. You know, what can we do better and a lot of brand said tell us what consumers are thinking so we can plan we said, okay. It’s a good idea. So then we started the consumer survey and we’ve evolved those and they’ve become a little bit more mature and sophisticated in the questions they ask and so those started happening. We said all right. Well, this was by the way how we found out literally on March 17th and 18th that there are actually some brands that were exploding as a result, you know, the coronavirus hitting.
At the time very few, but really exploding and so we said, okay. Well we’re sitting on all this data. Why don’t we actually go look at it? And so then we took brought over, you know, one of our senior data scientists to join our team and she’s been pouring through our data slicing dicing everything to sort of see if our hypotheses made sense and Help us learn and what’s going on? And so now we have you know, daily brand insights from Brands all around the world. We talked to two for a day as well. We have consumer insights from all over the world. We have hundreds of people that responded that and then you know every day we’re looking at sales data across 32600 customers globally to see what’s happening. And so we have a unique perspective on everything that’s going on.
Steve: Nice. Let’s get to it. Okay, so the for those companies that are kicking but what are they selling?
Jake: What a good question Okay, so Is what we call new Essentials. So what one of the things that we learned really early on is that consumers traditionally the spending the consumers were going to make was following a sort of classic framework from Believe It or Not, psychology. Have you heard of Maslow’s hierarchy of needs?
Steve: I have. Yes. Absolutely.
Steve: you want to explain it though in case they don’t know
Jake: Yes, super quick for the audience Abe Maslow. Is this sociologists and psychologists in the mid-1900s 1950s and he wrote this thing called The Hierarchy of needs which explained what normal people prioritize in terms of what they buy what they do and in what order and it starts on the base with food and water and then it goes to shelter, you know security so that you feel safe then it goes to belonging because people want to feel connected to each other then it goes to self-esteem so that you buy things that make you feel good and only once you satisfy all those things there’s you know, the top of the pyramid is self-actualization, which is when you pursue creative Endeavors and explore and try new things.
And so we started to see Categories beyond food and nutrition start to Trend up and those were office supplies. Those were Health and Beauty those were sporting goods and we saw this is super weird. Like why is that happening and it struck us that since people were relegated to work from home for an extended period of time. They had a new environment a new set of circumstances which dictated new Essentials for their new world. And so the categories that comprise new Essentials are in alphabetical order because I have it listed here.
Steve Haha Okay.
Jake: apparel and accessories but specifically activewear because people are working out more at home, electronics because people had to buy homes stuff and they want to entertain themselves. We hear people buying iPads and things hardware and Home Improvement, Health and Beauty, which is a fascinating one, housewares home furnishings and garden office supplies. I mentioned specialty Sporting Goods toys and hobbies education and Telecommunications are all trending up on average more than other categories.
Steve: I know weights are like sold out everywhere.
Steve: because everyone wants to work out at home. So if you’re in these categories and you’re sold out, I don’t know if you have this data, but if you’re selling out then shouldn’t the sales, how’s the supply chain. I don’t know if we want to jump. I don’t know how you want to take this.
Jake: anywhere you want. I literally I have absurd amount. in my head about all this.
Jake: So supply chain has been fascinating. That’s one of the questions that we actually asked every day what’s happening with your supply chain and let me actually pull it up so I can tell you exactly what’s going on.
Steve: Yeah, so these companies are doing well presumably they’re selling out right? product is just flying off the shelves and at some point they’re not going to have any product left to sell and just kind of curious what they’re doing.
Jake: Yeah, so some brands are selling out and that makes it very difficult for them to replenish and in fact hearing from consumers more and more they’re exploring more and more new brands. I think it’s because some places are running out that said a lot of people are not affected by inventory being down there. To replenish especially because China is coming back now. So if you Source from there, it’s coming. It’s just on a delay where they make it domestically and warehouses and fulfillment centers are considered essential in a majority of States. So they’re still working.
So if I look at supply chain affected, I’m looking at a daily Trend that we’ve been collecting since the 17th people report delays. There’s only roughly ten percent of respondents that say they don’t have access to all their inventory. Otherwise people are good to go. So more than 50% of brands are completely fine in terms of their supply chain.
Steve: Yeah, I mean, I’ve noticed that with my store as well like dislike the supply chain is fine. We were delayed maybe a most a couple of weeks and we’ve been getting shipments all the time. So it’s good to know that everyone else. I guess 90% of the people aren’t feeling that way.
Jake: Yeah. I mean I you know, I these are these are General Trends there’s obviously gonna be exceptions. But this is you know overarching lie what we’re hearing.
Steve: I have a quick question for you just involved with taking service and and this is just kind of from my own past experience people who are doing well will tend to fill out the surveys whereas businesses, who are struggling might not want to share that they’re not doing so well. Do you see that as the case or under how you mitigating that effect?
Jake: We do not see that I can tell you that. Let’s see over 20% of people who responded last week told me their sales are going down in the beginning of this that was over fifty percent. So people are two interesting things. What were observing is number one, people are so interested in simply understanding that they understand the give-and-take of sharing and then getting back aggregate insights. And so and we’ve been doing that daily. So I think People have been comfortable sharing. Also, we don’t say a brand new sales are down of course and we could leave it the other the other thing is, you know, we were a little nervous about that when we started looking at the survey early on seeing what percentage of Brands were up or down.
But then we end up looking at our own data and the numbers were almost identical which is fascinating because while you know, not every single day of the survey was perfectly statistically significant or do we advertise it as such the trends are spot-on and it matches, you know, like literally Like a 2% you know P value of it being not accurate. It’s kind of remarkable. Actually how it mapped up.
Steve: Interesting. Okay. So we talked about like the categories that are doing well and clearly they’re going to be fine and they’re probably really confident. Can we talk a little bit more about the businesses that are kind of down specifically what I’m looking for are, you mentioned that it went down from 50 percent to 20 percent down right? over time and clearly these people are pivoting somehow, right? So I’m just kind of curious what strategies are working and what they’re doing to Buck this trend?
Jake: Well, actually so two things it’s not necessarily true that Brands who are now up and less down pivoted their products. Okay. We’re actually seeing an evolution of consumer demand. And so one of the things actually just recorded a video. So if you go to Klaviyo.com you click on the green header bar. It’s going to take you to a dedicated coronavirus page where we have all of our insights and all of our resources there. We publish this stuff and so this will go up but literally, Let me pull this up here. What I just reported is that e-commerce sales are completely exploding and if you look at it by category, I’ll use a parallel as an example on March 15th. Apparel sales across all klaviyo customers were below total sales for 2019.
Steve: Wow, okay
Jake: this week they are up more than a hundred percent
Steve: Right, because they realize that they can’t they’re going to be hold out of at home for a long time. I would guess.
Jake: Yes, and so two things happened. Consumers one, started working out more and wanted to feel good about working out. So we saw Fitness apparel and accessories explode. I can also test that my wife buying things. Yeah, that’s true too. My hypothesis is with spring and summer coming in stores not opening, you know certainly in the next couple weeks. I think we’re going to see people buy more and more clothing looking forward to when they can go out and so we’re going to see that continue to go up. So number one consumers are changing what they’re buying still in the context of new Essentials, but they’re changing and so some brands that’s on initial hit are now doing better.
The second is yes, some brands are pivoting, but it’s fairly hard to do, you know, the success stories that I’ve heard is pistol lake is an example of a brand that they happen to be an apparel brand. They sell men’s like minimalist clothing out of LA and we published a story on them. They on March 15th had their sales get hammered wrote a plea to their customers to if they ever considered buying anything to please buy it now that gave them the cash flow they needed to not have to lay off anybody and with that they took their Factory and they completely turn it over to sell masks and they sold through 3,000 units in a day
Steve: Interesting. Wow. Okay. I have a similar story to share to share their so, you know, we sell wedding handkerchiefs and that sort of thing and obviously weddings in that sort of thing are going on right now. So what we did is we my wife actually made a craft on how to make a mask out of a handkerchief and then we just sent out an email that said hey, we’re going to give away a free handkerchief with any purchase along with these instructions, and we’ve been running that campaign for the past two weeks and it’s been doing really well.
Jake: That’s great. That’s awesome. How did you guys get that idea?
Steve: It’s all my wife. Like I’m obviously not a craft person. But I think I think there is this one craft that just went viral with something else. Maybe it was with the bandana and she was like, hey, we sell handkerchiefs we can make these into into masks and so we’re actually thinking about selling mask now too because we have all these really cool designs like the handkerchiefs are really intricate. And so we’re trying to actually find some contract sewer right now to make them.
Jake: it’s super interesting. That’s really cool. I actually think masks are here to stay. I think that people are going to be wearing them through the rest of 2020 in public and I think right now people are scrambling to get masks that are simply comfortable but what’s going to evolve is just like clothing and fashion people will want to express themselves individually and they’re going to want to find a mask that sort of Suits them. And so there’s going to be a massive long tail of awesome designs and cool different fabrics and different features as the market sort of evolved and figures out what people want.
So I definitely think there’s an opportunity there for a ton of different brands to sell things that people identify with and will wear out every day in public. I think I agree with you. I don’t know if you’ve been to Asia but wearing masks in Asia has kind of been the norm for a while now. So..
Jake: It’s comin here.
Steve: It’s probably coming here. Yeah, I mean there’s a lot of people going into Mask though. So at some point, I think it’ll be like the fidget spinner.
Jake: Yeah, right. Yeah.
Steve: everyone will make them and then gradually they’ll tell down over time.
Jake: We’ll see we’ll see where it goes.
Steve: So what other strategies are working, I’m Of interested in kind of the pivots that you’ve heard of before we move on to the rest of the data.
Jake: Yeah. I mean the biggest sort of counterintuitive Trend that I’ve heard is that acquisition through ads is more cost-effective than ever and easier than ever. I’m hearing brand say that row ads is, you know through the roof cpms and cpcs are down competition on ads has effectively gone away as most large brands of pulled out. I heard you know last last week the 16th of April was the biggest day that we’ve seen this entire year. They probably I have to compare it to last year Black Friday, but probably bigger than that and I heard a number of Brands say that they’re on site conversion rate was over 5%.
And so, you know to me what’s going on is with people not being able to go to stores spending more time online more time on social more time on email. They’re looking for either the products that they want or four ideas of cool things that they may want. There are trying new brands. And so if you know a brand has cash flow as willing to take the risk sort of sell that It’s totally working and I’m also seeing that some of our best performing emails are doing pre-sales. And so I’m wondering if there’s a combination of pre-selling items through ads to both acquire customers and to engage our existing customers I think is going to generate a lot of sales providing you can be transparent about when you can fulfill the sale date.
Steve: That’s interesting. I’ve seen cpms drop 20 to 25% on my end for my demographic just kind of curious you have the survey data are most people upping their ad spend or reducing it?
Jake: They weren’t at first there was like a little Arbitrage moment. But right now let’s see roughly. What’s this 25 percent of Brands report increasing their ad spend which is pretty consistent. Most of them are keeping it the same at like 25 percent, you know, we continue to hear that 15-20 percent of people just I’ve stopped spinning ads out, right and then, you know a similar amount are spending less. This is roughly in line with the overarching distribution of sales going up or down the difference is with brands that have sales going up there going up like three hundred to a thousand percent. They’re not going up a little bit.
Jake: and so, you know, there’s a relatively even split in the number of brands that are up or down but the brands that are up our way up, It’s kind of crazy.
Steve: but the brands that are down I’m kind of curious are they are they upping their ad spend to try to compensate for it or are those the guys that are just turning everything off?
Jake: most of them from what I can tell in this? This is now I’m an anecdotal and this is not statistically significant.
Jake: but most of them say that they are reducing their ad spend because they’re concerned about cash flow and they’re concerned about the future. So they’re relying more on strategies that can try and organically push people to their site. They’re working with other brands to try and trade list or cross-promote before they go increase the ad spend because they don’t want to burn cash right now because they don’t know how long they have to last in this current stasis.
Steve: Okay, that makes sense. So just Take the people out there who are running e-commerce stores that are down what industries are actually getting hammered right now?
Jake: Jewelry is having a tough time.
Jake: actually pull up my charts. Hang on. I just got rushed charts from our data scientist so I can look.
Steve: nice. I can tell you’re a geek about this Jake.
Jake: Oh my God, I spreadsheets. It’s kind of crazy, jewelry is having a tough time, although interestingly. So well, let me take a step back. Every single category has brands that are up and brands that are down. So when I say a category is up, I’m not saying every single person that sells that is doing well at all. But it tends to be that if you look at the you know number of companies in that category. It tends to be the more of them are doing better than less in the categories that are up. So jewelry as an example tends to have more brands that are down but there are some brands that are doing exceptionally well. We see spikes in particular of companies that sell Boolean. So if you sell like coins, this gold bars, yeah like that, you know, we put that in jewelry and they’re doing in like the spikes on the graph from
Steve: Of course with the FED printing money like crazy. Yeah gold is great.
Jake: Yeah. There’s your head, we’re seeing that’s like that’s the one that’s really had a tough time apparel and accessories was hurting for a while, but they have rebounded in a super hard way. Most everyone else is doing better Automotive is obviously down.
Steve: What about travel accessories? I would imagine those are down too
Jake: Travel accessories are way down. Down way way way down. Although we are I’ve been encouraging, haven’t seen this yet. I’ve only seen out of apparel, but I haven’t been encouraging travel accessories to partner with brands that sell things that people need now or to sort of like pre-sell stuff for the future so that people can look forward to trips in the future because I think you can get people to do that, but I haven’t I haven’t really seen it yet. So luggage is down. You know, I
Steve: give me an example of partnering with someone like what do you mean exactly?
Jake: So well one example, I can tell you from the Fitness space. There is a fitness apparel company that was way down and they were losing money and they’re having a problem and they reached out to bunch of gyms and basically said hey oh sorry, excuse me other way around there was a gym that was down. Obviously. Jim was closed. And so what the gym did to try and get revenue is they went to a fitness apparel company and said, hey we can promote your goods to our customers. If you give us some rev share and help us out
Steve: look affiliate program kind of?
Jake: yes, exactly. Okay partner has been massively successful
Jake: So, you know, I’d have to spend some energy thinking about for a specific category. You know, what the right partnership is, but you know, there are a lot of businesses that are closed that have customer bases who are active and spending money and there’s a lot of Brands trying to find those people and so there’s definitely Partnerships in there, especially at local businesses if you can strike them up
Steve: okay. So it sounds like based on what we’ve talked about so far. The majority of categories are up except for a handful.
Jake: Yeah, and I mean it shouldn’t really be that shocking because consumers can’t go to stores. so, you know the bet is do we believe consumers are still spending money, you know at a relative similar rate even just down a little bit and I think we’ve seen that the answer is yes, they’re still spending money just not as much as they did two months ago. And if you take away an entire category that was a majority of sales for through stores and you basically take it away e-commerce is going to obviously benefit from that because people need to buy from somewhere.
Steve: Sure. Absolutely. How much is eCommerce up overall. Do you have that data?
Jake: Yes. I do. Let me pull that up. This is insane, video slides. Here we go. It is up 80% since January.
Steve: Whoo crazy. I know for our store we were doing awesome up until March probably like the first week of March and then because our things are very event-related. That’s when things started going down. But this year had been a great year up until that point.
Jake: Yeah, we one of the things that we’re starting to think about is, how permanent is the shift, obviously when stores open people will go to stores. But what we’re seeing is we did a deep dive in New York as an example and we saw that week over week. There are more people shopping online than ever before and they’re spending more than ever before and so we’re starting to wonder, you know, is this forcing A catalyst a sort of acceleration of people to e-commerce that more people are learning how to buy online. They’re trying new categories online. They’re expanding what they’re purchasing online. They’re sort of changing their expectations on you know, how long they’re willing to wait for items how permanent will this be?
And you know next year when we look back what percentage of overall retail sales will be from e-commerce going forward. You know, I personally think it’s going to hit 22 23 24 percent up from mid teens, which is a huge huge jump.
Steve: I think It was 15 last year, right? Yeah.
Jake: Yep. I think it’s going to be low 20s next year. I think it’s going to be huge.
Steve: I would tend to agree with you and I’m just using my mom as an example. Like she didn’t know about Zoom. So like yell teleconferencing is new and then she’s been shopping online more than ever because she just can’t step out of the house.
Jake: Right? And so the question is how much of that will become something that she’s learned his comfortable with in the future. For example on a rainy day. Is she going to Brave, you know going to the store or she’s going to log onto her computer and and by their yeah, I don’t know.
Steve: Yeah. No, I totally agree. Can we talk about some of the other negative aspects of this? What about on the other employment side layoffs? And that sort of thing to have data on that?
Jake: Yeah that, super interesting we’re digging into this more because obviously it’s happening more but through our consumer survey. We asked people if they’re recently unemployed and what they’re doing and ironically spending among people who are recently unemployed on electronics was up more than Who are not unemployed.
Jake: we think what’s going on is people are you know buying if they’re you know white collar worker non essential worker. They’re buying, you know office equipment to try and interview right? Because they don’t get to keep their stuff from work. I personally think that consumers are spending money thinking that they’ll be home for months because a lot of companies aren’t hiring want to stay entertained. So I think they’re buying you know, iPads and gaming consoles and drones and you know things to play with.
Steve: That kind of goes against Maslow, right? You’d think they’d be stuck stocking on TP and stuff.
Jake: Well that assumes that they haven’t already done that and most people have you know, I think now they’re bored. Right? And so they want to they want to do something that’s creative and like keeps their mind occupied. And so that’s that sort of self-actualization. That’s why toys and hobbies are up. That’s why I like electronics or up, you know. That’s what we’re seeing.
Steve: Yeah, let’s talk a little bit about like the mental aspects of this so I imagine I’ve seen the survey. So how are people, how are Brands feeling about the future?
Jake: It’s a really good question. It’s completely dependent on how their stores doing.
Jake: so interestingly Brands so for I’ll go it we do grams of sales operations and sales down brands that are flat. And in fact, let me actually pull it up because I want to actually read you some quotes Choice quotes that come up.
Jake: The overarching for Brands were sales are up there super optimistic. Stick they don’t think that this is going to last forever. And so they’re definitely trying to take advantage but they think that they’re going to have more customers than ever before overall. You know sales will be higher than they had been in the past. They see it as like a net Boon to the e-commerce space overall, still scrolling, hang on. Brands who are down the general sentiment is nervousness and the nervousness is around how long this will last they’re nervous around, you know, will they be able To survive.
Their nervous around will they be able to pay their staff, their nervous around how they’ll sort of like keep up going forward for brands that are flat. It’s kind of mixed. They’re basically like we think will be good. And so we’re going to kind of stick it out. That’s the general take
Steve: Stick it out mean, no layoffs no change.
Jake: They’re not there. So when you the people the things that people are most afraid of and really don’t want is they don’t want to lay people off. And they don’t want to go out of business, you know, when I interestingly separate thread. I spent all of q1 interviewing roughly 50 businesses around their dreams around their aspirations. I ask people to question how will you know when you’ve made it which was fascinating and the consistent theme to my surprise across everyone is they wanted to be able to hire great people? Support them and give them a comfortable awesome lifestyle and work creatively with them every day.
That was their dream come true. And so I think that that manifests here, like people don’t want to lay people off. They don’t want to reduce their payroll their inventory, but they don’t want to go out of business either and so they’re working with that balance and I think for brands that are flat they’re not planning on cutting back materially there just may be decreasing some of their plans spends or not increasing. Ads get you know tend to get pulled back with in that bucket. They’re trying to just see this through so that they can quote make it to the other side.
Steve: And for the brands that are down. Have you seen layoffs?
Jake: I don’t know the answer to that explicitly.
Jake: I can say I’m looking at a question right now. I haven’t split it up yet. But it says how will you know, if you’re successful coming out of this and 17 percent of respondents said that they will have rehired laid off or furloughed workers. I haven’t looked what percentage of those are people with sales down. I can do that. But you know the bigger answer 71 percent of people believe that they’ll be successful when they see their sales rise again.
Steve: If you sell on Amazon or run any online business for that matter, you’re going to need a trademark to protect your intellectual property. Not only that but a trademark is absolutely necessary to register your brand on Amazon. Now, I used to think that any old trademark registration service would work and that could even try to register my own trademark by myself on the cheap, but I was dead wrong. Securing a trademark without a strategy in place usually results in either an outright rejection or a worthless unenforceable trademark. Now, that is why I work with Stephen Weigler and his team from Emerge counsel. They have a package service called total TM, which provides the same attention to detail and process that large law firms do at a fraction of the price. Now for me personally, I like Emerge Council because of their philosophy, their goal is to maximize IP protection while minimizing the price. So before you decide to register a trademark by yourself or file for other I could protection such as a copyright or a patent, check out Emerge counsel first and get a free consult. For more information go to emergecouncil.com and click on the Amazon sellers button and tell Steve that Steve sent you to receive a $100 discount on the total TM package for Amazon sellers. Once again, that’s emergecounsel.com over at emergecounsel.com. Now back to the show.
Steve: I mean I can tell you how I’m feeling about this and how we’re dealing with this since sales are down. We’ve been just having our employees going every other day and we’re confident that everything is going to be fine. Just because once people start getting married again. Well we’ve seen actually is so we actually embroider The Wedding Date on these handkerchiefs and we’ve seen a lot of people come back to us and say hey can we redo and adjust the date since we postponed it and I suspect that
Jake: oh fascinating.
Steve: Yeah. And so what we do is we give them a major discount on the redo, of course because you know, we have to throw away. Handkerchief with the old data obviously just do a new one but people have been coming back and they’ve been pushing their weddings out towards the end of the year and some have even postponed until the following year. So I insisted that our business will be fine.
Jake: It’s funny as you say that I’m reminded now that we were supposed to go to a wedding in June and they just delayed a year. I hadn’t thought of that.
Steve: Okay. Yeah. Yeah. So for me, it’s an obvious is only one data point is that we just need to get to the point where there’s either a vaccine or an antibody test and I think once people are comfortable moving again. I think everything will come right back.
Jake: I agree with you two things to share one. You said something interesting. You know, I’m just one person just the data point. But the reality is, you know, what I’m finding is each of these data points. Like there’s so many other people going through exceptionally common and similar experiences. Likely, however, you’re feeling there are many many people out there feeling the same thing and doing something similar. For whatever, that’s worth.
Steve: You know, what’s interesting Jake tomorrow. Actually, I’m having a friend of mine on the show that owns like 40 Restaurants and just kind of curious how he’s pivoting everything because rest of us has taken a huge hit.
Jake: huge hit. Did you see the article from Tom colicchio and had to lay off 300 people?
Steve: No man crazy. No.
Jake: Yes. It was really it was sad. I mean he it was in the New York Times and he was like it took me, you know, 12 15 years to build this Empire and like in a month. It’s basically because the cash flow business, you know, it’s like basically gone. It’s really sad. The other thing I was going to share is I’m publishing maybe tomorrow some predictions on when I think things will start to turn around and also like how it will unfold so that people can can can kind of get ready and I know that could be an interesting thing to talk about too.
Steve: yeah. Well, you just gonna leave you hanging like that?
Jake: The Cliffhanger I told I basically I think that the this isn’t going to be you know, turn the light on kind of situation. I think we’re going to see a slower evolution back to people coming back into the economy. So, I tend to look at examples in the past to help inform what might happen in the future. So I’m looking at China when Wuhan opened up again, and I’m looking at watching closely what happens in Germany and in China and Wuhan when they start around March 27th, they relaxed some of the restrictions and so people were allowed to go back to work and they were allowed to travel depending on their health status mostly, regionally and what’s interesting is while you know, within a week or two 92% of businesses were open only 60% of employees were going back to work. So that’s the first little clue that you know, public health will necessarily not have every single person rushing back. Number two, you know one of that makes me a little more pessimistic about the comeback in the US is China had this health app. Are you familiar with this?
Steve: Yes. Yeah, but explain it to the listeners.
Jake: Sure. So Ali Baba, I think a ten-cent work together and build this app. And so what it does is every single person in China is required to have this app to go anywhere to leave their compounds where they live and to join to go on public transportation and to go to work and what they do is there’s this little QR code that they have to hold up which can get scanned and it shows a color that says whether or not they are healthy and the way that someone is determine if they’re healthy as they have to enter their symptoms and then every so often a government official checks and verifies that what they said is true. And so, what happens as a result of that is you have a completely centralized view of the health of every single citizen in the state that will never happen in United States, ever.
Steve: Yes yeah.
Jake: And so one of the reasons that I think the unit that China on a particular, was able to ramp production and their Manufacturing in their industry back up so quickly is because they were able to have this visibility. They were able to test they were able to isolate when things started to spike back up so that we didn’t have a whole secondary wave because Americans are so stringent about security and privacy and unwilling to share this information. You know, I think we’re a little bit more vulnerable to a second wave because we will be slower to see it and respond to it and it will cause it will require a more, you know drastic response. I’m not I wouldn’t be shocked if there’s another period later this year where everyone has to go back home for a couple weeks. We’ll see.
Steve: Well, I agree with you mainly because the attitudes here are different like there was a protest in Huntington Beach. I think last week where people just gotten protested the whole quarantine. And that stuff would never happen in China. I mean, they would just squash that real quick. No questions asked.
Jake: but the interesting thing so so let’s assume, you know, we’re a little slower and it’s a little harder but it happens right the question that I wanted to answers. This mean for e-commerce, and you know the interesting thing when you look at Wuhan is sales over the course of March and into April from e-commerce for way up over February. And so as soon as people start to go out, they started buying more stuff. And so I spent you know, that seems counterintuitive to me, but I think the answer is number one. They have new needs. So when they you know when you go outside, what’s the first thing you’re going to do you go see your loved ones you go. See your friends you go visit something that you haven’t been able to see in a long time you go for a drive you go to a beach you do stuff. You couldn’t do it. Right?
And you need to buy things along the way whether you bring a gift or whether you need new clothes for that or whether you have to pay for lodging or whatever happens. And so there’s there’s you know, spending that happens. And so the question becomes where can they buy? I don’t think that as soon as people are allowed to leave the home stores are suddenly going to welcome everyone in with open arms and people would feel comfortable going I suspect we’ll see, you know similar to what we’re seeing in grocery store is where there’s a fine. Number of people per hour per day at a time and you can buy certain number of things whatever that will translate to many of the stores that have been closed.
And so I think that consumers are going to have new needs and new purchasing triggers and still not be able to return to stores and not be comfortable doing so so it’s actually going to lead to another increase in e-commerce sales across the board until stores come back.
Steve: You know, what’s funny is I just put out a it was a YouTube video that exactly paralleled what you just said, I think E Commerce is going to be the new normal and it’s going to take like probably a good year for retail sales to kind of get back to normal again because people are going to be hesitant. Like I know my wife, she’s not gonna be flying anywhere. She’s not going to be going out shopping unless she absolutely has to go.
Jake: Yeah, I think the really interesting thing. I’m super excited to well I should say I hope this doesn’t happen. But I guess I’m curious about is is like will what will happen in like September and October because I think, my personal opinion I miss is total conjecture total guessing. It’s just just Jake here. I think that we’re not going to see anyone going into any stores or any businesses opening until mid late June. I think then people will decide based on their comfort. What they will do I think in July will start to see like crazy sales and crazy advertisements you go, you know spend in stores and then I think August is going to be the time where hopefully we have sufficient test coverage.
But August is going to be the time whether you know, there’s another Resurgence in cases or not. And in August that’s going to tell us, you know, whether or not we’re prepared to deal with it in September and that is going to set the tone for the holiday season and if the if that’s goes well and we make it through and we don’t have another wave things will start to translate trickle back to normal. But if there’s another wave, Ecommerce sales are going to be up 5x 6X. It’s going to be absolutely insane.
Steve: I really want to, depends on whether there’s going to be an effective treatment for this and the when the vaccine comes out. I think that’s when everything is going to go back to normal but in the meantime
Jake: so when do you think that will be?
Steve: so my mom is actually in this field and she said the vaccine is probably a year away, but test the antibody test just to see if you you know, if you’ve already immune to it that will come out much sooner and I think there’s already some stuff that looks pretty positive might come out pretty soon. As long as the treatment is effective such that people don’t die, then that is a huge that’s another huge step right in giving you the confidence to actually go out there and take the risk.
Jake: totally agree with that. So I agree with you on the vaccine. My guess is May 2021. I think that the antibody test you’re right, but we had a tough start because we loosen restrictions on who could sell it. We have a whole bunch of antibody tests that are in sufficiently sensitive. So they don’t actually produce the right results.
Jake: and I think are pessimistic which is you have to have trust for that to like work.
Jake: but we’ll see. I hope that’s better. You know, I saw that Chiliad last week said they have a treatment like
Steve: I saw that yeah
Jake: I don’t know what to make of that yet. But I agree with you, you know, if there’s something that you can take that will effectively mitigate this thing to be like a light flu or like a bad cold and people don’t die as a result or not many died as a result. I think they’ll make a big difference, but you have to get everyone to trust that that’s actually true and that’s going to require, you know month or two months worth of data and it might end up yielding the same timeline.
Steve: Yeah. I mean if you hark back to Thousand one, you know, when the World Trade Center went down. I remember it took me actually a long time to want to fly again, even though it was completely irrational right? I mean ironically is probably the safest time to fly right out of bed, but it still took me like a good six to eight months for me to actually want to get hop on a plane again just mentioned.
Jake: I think yeah, I think the longer this goes on the more skeptical people become and without having exceptionally clear progress that is communicated unilaterally its it is people have to organically regain that trust which means they have to go through experiences on their own and that’s really hard to do.
Steve: So Jake if you were to kind of summarize maybe the three key points of all the data that you’ve gathered so far, what would they be?
Jake: Number one e-commerce sales are up across basically every category and they will continue to go up. So if you’re in an e-commerce, if your cell e-commerce your position to do well and you should keep at it. Number two, It is a good time to spend on acquisition and to get new customers. I believe that as the economy starts to open. We’re going to see a tremendous influx of advertisers trying to get people back to stores. It will become way too expensive to advertise and only the brands that have a big customer. Is and can communicate through our own channels them will ultimately succeed number three. If you’re a brand that is cells e-commerce, but is down there are absolutely opportunities to connect with customers, even if it’s not for sales, so it’s still a time to grow your customer base.
Consumers are looking to connect their spending more time online. And if you invest in growing That Base it will pay dividends down the road because you won’t have to compete for that attention later. You’ll be able to communicate and they will be excited to spend with you in the future.
Steve: So just a corollary what you just said, so that kind of implies that you should be spending more money on ads to acquire the customer. Even if it’s at Breakeven acquire the customer now plan for the future so that when you have that base, you can just sell to them once they’re more likely to buy or even if you’re losing a lot too
Jake: that’s my belief. Yeah.
Steve: Yeah Jake where can people find all these resources and take that survey?
Jake: go to Klaviyo.com at the top of the website is a green header bar. Click on that header bar and you’ll be taken to a site that has It’s coming multiple times a day a link to the survey. If you fill it out. You’ll get an email with results everyday and you can see day by day trends of which categories are selling and how much they’re selling.
Steve: and I will definitely link that up in the show notes. Is there a way to get like a daily digest so you actually don’t have to physically go to the site?
Jake: Yep, if you if you fill out the survey, you’ll get that digest.
Steve Okay, awesome.
Jake: and it’ll come right into your inbox.
Steve: Awesome. And if anyone has any questions for you Jake, is there a way to reach you on like other on Twitter or whatnot?
Jake: Yeah, always you can definitely email me. My email is Jake.firstname.lastname@example.org. I love feedback if they’re specific ideas that you want to dig into. You know, we’ve also put together this entire website of strategies of how of what to do and how to succeed during this time, which you can get on that site that I mentioned. So if people have ideas On how to do anything. We literally have published like 70 articles so far and then you know, if you want follow me on Twitter, it’s @Jfccohen, I try to share interesting strategies or things that are working so that we can just help each other grow through this tough time.
Steve: and I also want to emphasize like even if you’re a consumer there’s a survey also right on the consumer side as well.
Jake: Yeah, and it’s really helpful when people fill that out because it helps Brands understand what consumers want so they can make the adjustment to serve the needs of people as they evolve.
Steve: Yes. So I just want to emphasize to everyone who’s listening to this what we just talked about in this episode kind of only scratches the surface of all the data that they’ve gathered. So even if you’re a consumer or a store owner, I encourage you to go fill out that survey and then get all that data because it is very interesting and it will help everyone get through this.
Jake: as an example for digging into what people are doing with their stimulus package pay out money and that’s having later this week from the consumer survey.
Steve: Yeah. Well, so we feel that the PPP and we were one of the first ones I think to feel that we were way ahead of some other But I think most of the money went to small Banks which is a little annoying but that’s another conversation.
Jake: that was such a disaster.
Steve: Yeah, that’s another conversation itself.
Jake: yeah that isn’t, it’s so is and I feel terrible about how that’s all unfolded. It’s been such a mess.
Steve: Yeah, but Jake thanks a lot for coming on and sharing your insights. I don’t think there’s any other company that’s compiling all this data. So I really appreciate you doing this and sharing all the data with everybody.
Hope you enjoyed that episode. Now, the effect of the coronavirus on e-commerce can only be a good thing. And if you look at the stats on the clay via website, you’ll see that practically every e-commerce category is skyrocketing. For more information about this episode. Go to mywifequitherjob.com/episode301.
And once again, I want to thank Privy for sponsoring this episode. Privy is the email capture provider that I personally use the term visitors into email subscribers. They offer email capture exit intent and site targeting tools to make it super simple as well. And I like Privy because it is so powerful and you can basically trigger custom pop-ups for any parameter that is closely tied your eCommerce store. Now, if you want to give it a try it is free so head on over to privy.com/steve. Once again, that’s P-R-I-V-Y.com/steve.
I also want to thank Klaviyo for sponsoring this episode, Klaviyo is my email marketing platform of choice for e-commerce Merchants. You can easily put together automated flows like an abandoned cart sequence a post purchase flow or win back campaign. Basically, all these sequences that will make you money on autopilot. So head on over to mywifequitherjob.com/klaviyo. Once again, That’s mywifequitherjob.com/klaviyo.
Now I talked about how I use these tools in my blog and if you’re interested in starting your own e-commerce store heading over to mywifequitherjob.com and sign up for my free six day mini-course just type in your email and I’ll send you the course right away. Thanks for listening.
Outro: Thanks for listening to the My Wife Quit Her Job Podcast where we are giving the courage people need to start their own online business. For more information visit Steve’s blog at www.mywifequitherjob.com
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