EP #388 - Strategies to scale your Amazon brand into DTC - Sarah Carusona

EP #388 - Strategies to scale your Amazon brand into DTC - Sarah Carusona Unknown Speaker: Welcome to The Ecommerce Lab By Ecomcy. This is the place for everything related to Amazon private label and e-commerce. Learn exactly what you need to start or scale your business. Get insights from the top industry experts who will discuss the latest trends and best practices in the world of Amazon. From choosing products and sourcing from a supplier to setting up your Amazon account and marketing your business, you will hear it here. Let's get started. Here is your host, Vincenzo Toscano. Speaker 2: Hello, guys. Welcome to another episode of The Ecommerce Lab By Ecomcy, the place of editing related to Amazon FBA, private label, and e-commerce. My name is Vincenzo Toscano, founder and CEO of Ecomcy, and today we bring another special guest. Her name is Sarah Carusona. She's the founder and CEO of BA Ecommerce, where they specialize in everything that has to do with DTC. And we all know that DTC is something that I always say every single brand has to focus on. And that's why I wanted to bring Sarah today, because with her consultancy, they specialize in everything that has to do with operations, strategy, and more importantly, what are the latest trends to make sure that you can make the most of this channel. So Sarah, welcome to the show. Thank you so much for being here. How are you doing? Unknown Speaker: Thank you. I'm so excited to be here. Speaker 2: Thank you. It's a pleasure. I'm very excited about today's conversation, especially because a lot of our listeners and the ones that watch a podcast, you know, a very kind of marketplace savvy. But sometimes when it comes to DTC, they don't have a lot of expertise or they're just getting started or they're just having, you know, some struggles. Along the way, and I'm sure, you know, with your expertise, I'm sure a lot of the insights you're going to be sharing today can unlock that potential that D2C definitely can bring to the table. So before we dive into the topic, maybe just give us, you know, a more in-depth introduction about yourself, how you started into this space, and we can go from there, yeah? Speaker 1: Yeah, I appreciate it, Vincenzo. Uh, so yeah, my name is Sarah. I'm from a small town in the middle of Illinois, but, um, lived in Chicago most of my adult life. And, uh, currently I'm in Buenos Aires, uh, cause we decided to start traveling the world and landed on Argentina. We love it. Uh, my background is a little bit unique. I actually have a degree in dance, uh, because, you know, when I was 18, that seemed like a really good idea for a minute. And then I sort of stumbled my way into it. I do. I do know how to dance. Yeah, it's a yes, I do know how to dance. Not very well, though, because I'm not so good at it, I guess. I got into fitness because I was sick of waitressing because you don't make anything as a dancer. And that kind of started to introduce me to social media marketing. And I worked at small gyms where I was trying to get people into the gym and understanding business. And long story short, I worked my way into working at agencies, running Facebook ads. More recently, I was at Common Thread Collective for a couple of years. And then I got poached and went over to Olakai, which is a nine-figure footwear brand. They also own a couple other brands called Mellon, Rourke, and Kanin. So I was there for a couple years. I managed their nine-figure P&L. $26 million of ad spend across everything from Meta and Google, TikTok to TV and influencers and affiliates and out of home, you name it. Retention, loyalty programs, email, SMS, CRO, landing pages, upsells, and then also inventory management, which is really interesting, and their overall data infrastructure. Definitely wish AI was as good as it was now when I was doing all of that. But from there, I really wanted to travel and live abroad. And so I left and did some fractional consulting. And throughout all of it, I kept seeing this kind of interesting pattern when it comes to brands and agencies. And I also realize that I love working at the bigger brands and I got a lot of experience there. I really love working with startups. I think that they're just a lot of fun and I love working with founders and with products and services that the founders really care about. And I kept seeing these founders who needed help, but needed help in a way that wasn't just another agency. Like they didn't just need another media buyer. They didn't just need another creative strategist or a retention person. Like they needed somebody who could actually sit in the seat next to them and be their co-pilot and be able to flex and mold to what was needed at that time. My husband worked at EY, which is a bigger consultancy, mostly in the States. And I just had this idea of why can't I apply the consultancy model to e-commerce? And so that is what we do at BA, which is named partially because I came up with the idea while we were living in Buenos Aires, but also because it kind of sounds like badass, which I like. And so what we do is we hire and train what I call growth operators who get deployed on brands at 20 to 30 hours a week. And they basically operate as their head of growth, overseeing retention, acquisition and conversion. They get really hands on where needed. They, you know, it kind of depends on what the brand actually needs, but it's all backed in a financial model that we build off of LTV to CAC and the overall brand's goals. And we manage that across Amazon, Shopify, TikTok shops, really any digital channel. And yeah, we've been around for a little over a year and a half and it's been a lot of fun. Speaker 2: What a journey. Love it. Yeah. So I'm very excited that the different kind of disciplines you went along to reaching this point, which at the same time I feel, especially when it comes to Ecommerce is so useful, especially if you work with so many diverse brands. I mean, it happens even to me. Sometimes you work with sport brands, sometimes you work with different disciplines. And I think having that different perspective being built from a very young age definitely opened the mindset to having a very, being very resourceful, I call it, you know, like being able to troubleshoot things on the go. And that brings me kind of to the conversation of today, which is I feel that's where a lot of sellers really struggle when it comes to D2C. I feel it's such a vast subject and it's becoming so complicated lately with so many tools, so many KPIs, so many integrations, so many things to track that a lot of people really struggle to be resourceful and really kind of figure out how to even start in the D2C space in the first place. So I guess to kind of start today's topic, I would love to ask you like when somebody comes to you And I ask you, like, how do I know if I'm ready or not when it comes to D2C? What is the first thing you think a brand should have to do that initial jump to really own their audience, especially if they're coming maybe from Amazon, which happens a lot. They're coming from Amazon. They want to open their D2C channel and they really struggle to change their mindset and really understand what are those key elements, you know? Speaker 1: Oh, it's such a good question. I mean, To me, and it's interesting because I did a consulting call or a mentor pass call yesterday, and my number one question for people who are, you know, exploring whatever it is, like, what do I do to grow? What do I do to move from Amazon to, you know, Shopify, et cetera, is what is your goal? Because if your goal is to just make cash and chill and you're happy where you're at, and let's say you've got a great Amazon business and it's doing really well and you're happy in your life, maybe that is okay. But if your goal is like, no, I have this brand and I want to double it, triple it, and I believe in this mission and whatever it is, then yes, then that makes more sense to go to Shopify. And the reason I asked the goal is because DTC is hard. It just is. It naturally is. And so you've got to want it. And then the second thing is all based on the product and you've got to understand Based on your product and brand, where the opportunities and risks are. There are certain products, excuse me, that are just going to work better from a direct-to-consumer perspective and from a, I would call it Shopify perspective. And there are things that are going to work better on Amazon. If you're selling like a, I don't know, a mouse or something like a, like a, not a, not a human mouse. Sorry. I realize that people can't see us. Uh, maybe Amazon is your play. Like do you, can you really create a brand and content around a computer mouse that people are going to click through a meta ad and then buy it's got to have something unique to it. Um, the other really important thing. I actually put together a little bit of a like a document that outlines how to think about launching a new brand. And I think of it as there are two main And today we're going to talk about two things that are the most important and it's going to be your margin and your price structure is like number one. And then the other one is the unique mechanism and the unique solution that you are solving for. So why is your product and solution better than something else? Because that is going to inform all of your marketing, all of your content. Those are the two, like if you have, if you wait those at like about 40% each, that's like 80% of what you need in order to launch on DTC. From there, it's like, do you have the team that can support it? Do you have the cash to support it? Do you have the infrastructure and the operations to support it? But really, it all comes down to your pricing and your margin structure and that unique mechanism solution. Speaker 2: Yeah, I think something that I always say, especially after hearing everything you went through is like, when it comes to you being a brand, because it happens a lot and you're already being very successful in the D2C side of things, I always say like, you have achieved the most difficult things when it comes to ecommerce because it happens a lot that sometimes D2C brands come to me. And they say, oh, now I want to do Amazon. I want to do other marketplaces. And I always say, like, you have done the most difficult thing. Now, pretty much it should be a walk in the park. And the reason why I start with that is I feel Going back to what you just mentioned is very hard in the sense that especially if you're coming from Amazon, let's be honest, on Amazon, you can be a successful seller, but sometimes that doesn't mean you have a successful brand. You just happen to time it correctly, you get a position, you probably became a commodity and that's it. You didn't really need to go out there and find consumers, retarget them and all of that, which is not the case with DTC. DTC You can have a website, but if you don't bring the traffic and bring traffic correctly, you're not going to make a single sale. Nobody's going to come to rescue you. And that's why there's so much novelty around that. And that's, of course, some of the things I want to kind of break down on today's episode, because you mentioned a few things that I feel are very key elements, which is The product itself, right? I think most people, I always say this, most sellers when it comes to ecommerce, they have a SKU or they have, I call it, an acing. They don't have a brand. And based on what you told me so far, it seems that on D2C, if you don't really have something unique or a brand or a mission, something that make you stand out from the crowd, it's not really a space that you can only win on pricing or correct me if I'm wrong, that you really need to offer something that will essentially justify the person go beyond the traditional marketplace and go to your website, isn't it? Speaker 1: Yeah, yeah, exactly. The world has become so much more saturated with different products as well. Tchotchkes, you used to be able to sell. I mean, I saw companies who are selling like switchblades and stuff that were just like, you know, they probably bought off Alibaba and made millions and millions of dollars. That is not. Unknown Speaker: As easy as it used to be. Speaker 1: And the reason for that is partially because it's just become saturated and the consumers become more aware, partially because Amazon's become so huge. And I can just go, I mean, any, any, I mean, again, I'm using the word tchotchke, but any like, yeah, utility thing I buy on Amazon. Yes, commodity for sure. But the Shopify, the direct-to-consumer, that's got to be something that is more unique. It's got a story. It's got a brand. You have to have a reason to buy it, not on Amazon. I think that's actually a really good way to think about either if you're launching on direct-to-consumer or you're on Amazon and then you're launching onto Shopify. You've got to take a step back and think about it from the consumer perspective. Why is the consumer going to buy it on Shopify? Why? And be very, very honest about that. Because even if you do have a, you know, in the opposite sense, when I was at Olakai, they had a really big Amazon business and it grew pretty exponentially while we were there. And one of the big conversations that we had was, is the Amazon consumer different than the Shopify consumer? And there was a debate that happened and I am firmly on the belief that consumers are both. They're not split. People buy wherever they want to buy. And so even when you do have a reason to buy in your Shopify store, you still have to understand that there's going to be that halo effect to Amazon and there's going to be people who just buy on Amazon because they want to. But the two of them together, I think, work obviously the best. And if you can think about them and measure them holistically, that's really where you can have some exponential scale. Speaker 2: Yeah, I think that's such a good way of putting it. In fact, I always bring this example to the table, which is Apple, right? Brand that everybody knows. They are also on Amazon, but if you actually go down into what they sell on Amazon, usually they only sell the base models. If you want to customize the specification of the MacBook and everything, you have to go to the website. So I think that goes in line with what you're saying. Like, yeah, Amazon, of course, has to be part of the journey. But at the end of the day, the same consumer that will shop on Amazon, if they know they can get something special on your website or something unique or promotional or a digital asset, That's how B2C can really make a huge impact into how you engage with your consumers. Speaker 1: And I would say with that, you have to take that strategy of, because again, Olekai did this, where we would have certain products on Amazon and we wouldn't have, or sorry, we would have certain products on Shopify that we wouldn't have on Amazon. Olekai was a very big brand. They spent a lot of money on brand and there's a lot of awareness for that. So, Apple's another example. Like, everybody knows Apple and they know when they go and shop, they can see what products are available and they're like, huh, I wonder if there's something better on their site. But if you're a smaller brand, if you're just starting out, you have to realize that people aren't looking at, like, if they discover you on Amazon, for example, they're not looking to see, like, what brand is this and thinking, oh, maybe they have a better product on their site. I'm going to go check it out. The only reason they're going to do that is if they saw meta ads and tic-tac ads. Oh, there's like all these other products. So again, there's this if you're looking to build an actual brand and an omni-channel brand, it's you have to have marketing off of Amazon. You have to be spending to get eyeballs and having people understand who you are and why they should shop with you. Speaker 2: Yeah, and you mentioned Meta, Google Ads and other. I think that's also until now being a huge barrier to do DTC because in the past, If you want to do that, you need to invest so much, so much resource into creatives, copy, landing pages, all of that. Now with AI, a few clicks, you can kind of come up with all the material very kind of fast and effective and you can kind of scale your D2C operations so much faster. So I'm very curious into how you are actually seeing AI making, I guess, barrier of entry into D2C easier maybe. Is that something you're also seeing? Speaker 1: Yeah, I would say so. I think I think what I'm seeing a lot of is that people who have been in the D2C space for a while, whether working at agencies or brands, are now realizing how much they can do with AI. It used to be like if I wanted to go and create my own brand or whatnot, I would have to think about, okay, I need to hire a media buyer, I need to hire an email person, I need to hire a creative strategist, I need to hire a video editor, I need to hire a landing page designer, I need to do all these things. At this point, I could probably start a D2C brand with myself and one assistant and get it all done. However, that's also because I have the knowledge and the basics behind and the experience of what I know what everything should do. I would say if somebody is just starting out, they need to be ready to really educate themselves on how everything works and how they all work together. Like what I'll say is like we still, I haven't gotten to a point and I haven't seen anybody yet who is fully using just AI for media buying, for example. I know there's some that are there, but they're always got like a level of approval of somebody who has been a media buyer and is able to, you know, make the final like, Thumbs up on the decisions that are being made, especially on Meta. I think Google, Amazon, those are probably where AI is going to, I think, be. I would have more trust in letting AI make daily optimizations. Meta, there's just such this art and science to it. And I've also seen, I grew up in Meta Media Buying and then I managed teams of Meta Media Buyers and I've had At least three phone calls on weekends or holidays where a media buyer accidentally set something incorrectly and spent like $10,000 to $40,000 in a couple hours. And VEDA doesn't really like to give you money back. So yeah. But I mean, I know. Yeah. But yeah, I think there's there's there's so much opportunity. I would just say that the that the AI is going to allow us to Optimize and run really quickly, but it is going to be limited by the operator who is overseeing all that AI. Speaker 2: Yeah, I think this is something I'm seeing a lot lately. I feel, of course, AI is something that I invite everybody to. And I've started implementing as soon as possible in their business. But at the same time, I've seen the extreme of some people doing what you just described, which is start automating everything. Sometimes they don't have a clue about even what they automate in the first place. And I think the risk with that, first of all, is the mistakes that you're going to do along the way when automating things that you don't know what is the impact it can have on the business. But the second thing is really my main concern is I feel if everybody start automating everything without experience and don't really know where they're heading, they all gonna end up in the same place. Everybody's gonna become commodities in the sense they're all copying the same algorithm in the backend. I think what you say is very important. You need to have somebody that has the experience, that understand the operation. And the reason why AI is into the picture is not to take over from a strategic point of view. It's to do something that took two weeks into one day. Move fast. Speaker 1: And I think too, like what I'll add to that is because in the last, especially in the last six months, just with how fast AI is advancing and how many things you can automate, I spent a lot of time thinking about where AI fits in my business as well as the businesses that we work with. And the framework that I came up with that finally helped me just And what I want you to have clarity in this whole conversation is if you think about growth or growing a business, it really comes down to like three sections. Section one is getting from point A to B, which is like, what is the problem or opportunity that is data-driven? So we need to have better new revenue acquisition at a better margin. OK, great. That's what we need to do. What are the numbers that we need to affect? We need a better click-through rate. We need meta to do better. And we need a better conversion rate. Great. That's the numbers that need to happen. Then from B to C is what do we do to affect that? And that's where the strategy comes into place. What ads are we deploying? What's the marketing message? What's the offer structure? What does the landing page look like? That's like the strategy section. And then part three. C2D is the execution layer and that's where you're using AI to create new ads or videos or landing pages or whatnot. And I feel like in this industry, everybody's focused on C2D, the last part, where they're like, hey, I can get out a thousand ads in 10 minutes or I can create like 20 landing pages, whatever. But they're forgetting the data and the strategy. Which is the part that is the head and we're all leading with the tail. And I think that's like the other really important thing. So I'm focusing and our business is really focusing AI on those first two sections because the last section, there's so many tools out there that are already automating things, which is awesome. But I want to make sure that that automation is led by data and strategy. Speaker 2: Yeah, and more importantly, the identity of your brand, because I feel if you also automate the identity, at the end of the day, you're really now transforming your vision of why you want the brand to be the product into reality. You're just kind of copy-pasting a series of analytical steps the AI is doing on your behalf. And that's where, again, we end up in the same point, which is you're just going to be very similar to other brands out there. It's going to be tough. So definitely it is a very important point to bring to a table, which I think brings me to my next thing, which is, I guess, the future of D2C. I'm very curious to hear your take on what are some of the things you feel Founders should be really mindful moving forward in the D2C space because I guess to start bringing a summary of what we have discussed so far, we really have understood that D2C is meant for brands that really bring something unique to the table. It can be an experience, it can be a product, it can be really kind of the journey. The second thing is understanding that you need to understand how to kind of engage the consumer beyond traditional PPC with all the kind of meta Google retargeting and all of that. Of course, AI can help a lot with the operation, but that still opens the question of with so much competition and so much kind of channels coming up, how do we make sure moving forward we stay relevant? Is there something you're doing to stay, I guess, future-proof, if you want to call it, or to stay consistent? Is there some advice you want to share? Any concerns? Unknown Speaker: Yeah. Speaker 1: I think the advice that I would share is there are so many tactics that I think have come out in the last 10 years and especially in the last six months again with AI. And there's so many, I don't know, hacks, so to speak, to growth. But what I've seen, at least in my career, is those hacks have gotten less and less impactful. And yes, they still exist and they come out all the time and people on Twitter and LinkedIn will post whatever it is. But if you don't have the solid foundation of a really good product and story and reason to buy, none of it matters. And so what I'm seeing now and what we work with our clients on especially is we work with them on their current product line and their current marketing. And there's always things that we're able to do to grow. And what we also do in the context or what we also do at the same time is we start to understand where there might be opportunities from a product perspective, because at the end of the day, you're going to be limited in that product. And so we've had clients, for example, where we've had a product that we were able to sell really aggressively and we were able to grow them significantly, basically from zero to six million in a year. And what we found is that the products, the consumer started to churn at a higher rate than what we wanted to and they were churning because they didn't like the taste of the product. And so that is something that then we worked with the client on in order to reformulate and to also change our messaging a little bit because we were leading with taste. And so I think, I guess my advice in all of this is to remember that I would say it used to be maybe 20% of the work was on the product and the marketing and everything else was like hacks and everything else that you could do. Now I would say it's like 60 to 75% of the work is on product and marketing, and then it goes into growth. And you really need to have that good pairing of product and marketing and growth. So you've got that really good feedback loop of what the consumer is saying and how they're interacting so that you can react to that quickly from a product perspective. Because at the end of the day, that is what's going to help you to grow. Speaker 2: Love it. I mean I think that's such a good way to end to the episode. I think you gave so many good insights and more importantly kind of A blueprint of what people should take home and kind of start exploring. So I think I'm going to leave it there. I think before concluding, of course, I want to give you a minute or so to tell us more about, you know, your company, how people can reach out to you. And then, of course, I will make sure to put all information down below and we can close with that. Yeah. Speaker 1: Yeah. I appreciate it. Yeah. I'm on LinkedIn and X, Sarah Carusona. You can also find us at BAAcommerce.com. It's BAA-commerce.com. And yeah, would love to connect with any business owners, founders, operators. We, you know, like I said, we typically work with clients in the five to $20 million range who are looking to grow 100% or more year over year. We do month to month contracts and no harsh non solicitations. And we have almost 100% retention rate because we do really good work that I'm proud of. So yeah, would love to also just love connecting with people in the industry and whatnot. So feel free to reach out anytime. Speaker 2: Love it. Thank you, Sarah. So I'm going to make sure everybody to find all the information down in the description. But other than that, it's been a pleasure. Thank you so much for all the insights and hopefully see you soon on the next episode. Yeah. So thank you so much for being here. Speaker 1: Thank you so much for having me. Speaker 2: Thank you. Have a good one. Bye bye. Speaker 1: You too. Unknown Speaker: Thanks for listening to The Ecommerce Lab By Ecomcy. Be sure to subscribe so you don't miss an episode. While you are at it, we would appreciate it if you could leave an honest rating and review on Apple Podcasts, Spotify, or wherever you listen. That will make it easier for others to find out about the show and benefit from it. Want more? Visit our website at www.ecomcy.com where you can get your first consultation for free or find us on Instagram, Facebook and LinkedIn at Ecomcy.