E-Commerce Speaks - Episode 2: Data is the New Gold - with Mike Pruchnicki

Data is the New Gold - Short Summary

In this episode of E-Commerce Speaks, we talk with Mike Pruchnicki, former Performance Marketing Lead at The Razor Group, and previously, Head of Paid Social at eObuwie (now called Modivo). Our discussion ranges from the challenges of managing numerous ad accounts for numerous storefronts, through how Mike helped to scale monthly spend from five to seven figures.

We also discuss:

• The importance of cleaning up your data
• CAPI and the iOS14 update
• Advice for e-commerce retailers today

Transcript of the episode

SAM
Hey, everyone, and welcome to E-Commerce Speaks - with ROI Hunter. Today we're speaking with Mike Pruchnicki, who comes to us with experience from being Performance Marketing Lead at The Razor Group, and previously the Head of Paid Social at Modivo.

So thank you so much for joining us here today. Mike.

MIKE
Sam, it’s a pleasure to be here with you.

SAM
So, yeah, let me let me get right into it with you. Can you talk to us a bit about the work you've done as Performance Marketing Lead when you were at The Razor
Group, let's talk a little bit about the challenges you faced, how you measured success.

MIKE
Yeah. So I will start with describing the type of company The Razor Group is. It’s a brand aggregator. So basically that's a business that buys other e-commerce businesses that sell their products on either some kind of marketplaces like Amazon, or they have their own B2C stores, let’s say, based on Shopify.

So after Razor Group purchases a given business, then it tries to scale it in-house with in-house resources: in-house product team, in-house IT team, in-house marketing team.

So basically I was Team Lead in the performance marketing team. We were responsible for running performance campaigns across multiple channels for over ten brands selling on Shopify stores across international markets.

SAM
What would you say were some of the some of the most tricky things that you had to face on a day-to-day basis? Could you walk us through a day in the life? 

MIKE
Yeah, I think that one of the most tricky things was putting all the data together, because when working with multiple Shopify stores, multiple channels, multiple ad accounts across, multiple currencies open because these were the ad accounts that we took over from the businesses when they were purchased, right?

So there were like two different setups of measurement, different payment methods, different currencies, different types of campaigns. So starting with it was first fixing the basics. Making sure that we've got operational payment methods  for each and every ad account, setting consistent naming conventions, making sure that the tracking is set the correct way on every platform and every ad account, and then coming to aggregating all these data together because, as I said, operating with such multiple number of entities as a Performance Marketing Team Lead, I needed to have a way to look at the data in one place for every store, for every channel.

So you can imagine that going through all of these dashboards, 10 Shopify stores to 20 ad accounts and so on, it was very time consuming.

SAM
I can only imagine.

MIKE
So we had to figure out a way to to manage that in the beginning.

SAM
Did you have any, any favorite tools that you used for managing that?

MIKE
Yeah, I think I think that the tool that helped us a lot was Super Metrics, and API connector that let us pull the data from all the platforms that we were using, put them into one place, for example, Google Sheets, and then use some stitching and visualization in order to look at a set of dashboards that we are using on a daily basis.

SAM
Okay. So it was, there was still some manual work involved. And to bring it all together, stitch that data together and be able to assess it all as one.

MIKE
That's right. But when you did it for the first time and set the right formulas and the right schedules, then it was all automated from that point.

SAM
I see. That's great. Is it something that you see would become even easier in the future as AI starts to take over? Like, yeah, I'm just really curious how you would imagine AI would come into work like this as we progress.

MIKE
Yeah, I mean, there is obviously some kind of algorithm to that. You need to pull the data from the right places. Then you need to maybe stitch them based on the let's say day, and then you put all the data in the corresponding drawers from different sources. That's the easiest way just to use the current date as the connector for all the data.

Of course, you can go even deeper and you can go into campaign, ad group, or ad set, or ad level, but that's like another thing. But I think in the in the basic version,
when you stitch the data based on the day, I think that AI could do that in the future.

SAM
Okay. Yeah. I mean, I think we're just going to see such ease of usage, hopefully, or just improved performance as it comes in.

One thing that I wanted to get into with you was your previous position before The Razor Group when you were Head of Social at Modivo. I noticed that you were talking on your LinkedIn about scaling the monthly spend from five figures to seven figures. Without obviously going into too much detail about stuff, can you tell us a little more about that and how you went about that as as Head of Social?

MIKE
Yeah, that's a great question. So basically when I joined Modivo it was called eObuwie back then, but right now it’s Modivo. It was a really big company. It was one of the best known e-commerce companies in Poland and it was well known, I think in Central Europe.

SAM
Yeah.

MIKE
It had like a few hundred employees, eObuwie brand was present on, I think 12 markets and new markets were being launched. So when I joined there were only two people working in the Paid Social department, and my role was to take paid social activities to the next level. 

So there were a few key areas that they needed to address in the beginning. So the first one was measurement and reporting. And here it was kind of similar to The Razor Group where you had like multiple ad accounts, multiple Google accounts- Google Analytics accounts, and you needed to stitch that data together.

So that was one thing. The other area was technical setup. It was related to big selling improvements, especially tracking products interactions more precisely. Also, we needed to touch up in Product Feed a little bit.

The other key area was managing relations with stakeholders because that was also a very important part to make them informed about our progress and how we are doing. And then finally communicating business goals to the team. That's also an important part, like translating what comes from above my position to the team
that I was working with.

And let me go a little deeper into the measurement part. So, we started with introducing consistent nomenclature of the campaigns, ad sets, and ads that we are using. And because before I came it was a bit of you know… it wasn't as organized as I wanted it to be because I was already thinking that the data needs to be pretty cleaned up in order for us to use it on an aggregated level in the future.

SAM
Absolutely. I mean, even for a lot of tools, you have to make sure that your data is clean to the point where it's usable.

MIKE
Exactly. And the other area that was related to that was implementation of automatic UTM tagging. Right now I think  it’s a standard for every ad account, but back then it wasn't as popular. And when I came, the company was still using manual tagging for most of the campaigns, which was on one hand time consuming, and it was also prone to errors when using manual UTM tagging.

And another part related to that was automatic Facebook and Google Analytics data merging on the scale.

SAM
Okay.

MIKE
So when we already had the clean data, we had automated UTM tagging, then we were ready to pull the data into one place and stitch it together. And then on the final point, we were able to to collect data, draw conclusions, and introduce some changes to the to the campaigns, to the activities we were running.

But I think what the viewers and listeners to the podcast would like to know, these are some of the basics. What gave us a big improvement after implementing all of these basics was making sure that our measurement was perfect. 

And I want to say again that making sure that the product interactions were tracked correctly and it's not about, you know, reading the documentation that Meta pixel documentation like that, because then there wasn't much such like CAPI. It wasn't only reading about, but also understanding and making sure that we applied these methods to our business case. So that was something that gave us a huge boost in in performance.

So putting this all together, it was measurement reporting and technical setup that led us to achieve those gains. So I just want to say that in the first full year, 2019, we were able to increase the revenue by over 900% while growing the investment, the ad spend, by 450%. So we not only increased, we not only increased the scale of revenue by ten times, we also increased the return on ad spend by two times by using those methods.

SAM
Yeah, I mean, because I know it's tough to keep it even consistent while you're actually scaling revenue by that much, so the fact that you're able to improve it with that is amazing.

MIKE
Yeah. And in upcoming years, of course the growth wasn't as dramatic like 900%,
but it was still 200% in upcoming years. And then of course we reached, at some point after a few years, we reached that stagnation period. But the first, I think three years when when I was in the company, it was this explosive growth. For a few years.

SAM
Now did you notice over the time that you were there much of an evolution in social media? Was there was there a lot of change happening? Like, what were the biggest things that you saw changing over that period?

MIKE
Yes. So I think that the first one and the one that influences performance marketing the most were privacy concerns and regulations.

SAM
Sure.

MIKE
These were the times when iOS 14, the dreaded iOS 14 was introduced and changed a lot in the way we ran the campaigns, right? 

SAM
Hence bringing in CAPI and all of the ways to connect the additional signals.

MIKE
Exactly. And speaking of, you know, managing the relations with stakeholders, that was one of the big challenges that I mentioned. It was getting them on board to, let's say, putting some IT resources into actually implementing CAPI.

SAM
Really?

MIKE
Yeah, exactly. Because in a company like this, we had an internal IT department and, you know, they are always busy. They always have a lot to do with the, you know, e-commerce platform and so on. And one of the most important things
when implementing CAPI was getting the C-levels on on board.

SAM
Did they just not see the value in it or they didn't want to take the risk of of connecting...?

MIKE
I think after we presented it in a very convenient way, they saw that. But it was the job that we needed to do to to tell them about the big influence that CAPI will have on our business, especially given those privacy changes.

SAM
I mean, yeah, because now CAPI has become pretty much A must have. Just, we're a little late on this, in case anyone is unaware what “CAPI” stands for, its Conversions API. It's the way that Meta has connected additional signals to the campaigns for targeting so that you can still send the right products to people while respecting the privacy concerns that come from Apple's iOS 14 update. 

Did I get that? Is there anything I'm missing from that that you would add for CAPI?

MIKE
No, I think I you're describing this perfectly. And, you know, back then, we were one of the first Meta customers in Poland that were implementing that tool.

SAM
Really?

MIKE
Yeah.

SAM
And I mean, I feel like this is something that's going to be like if you, if you are a retailer out there and you haven't implemented CAPI yet, we're still waiting for Google to sunset third party cookies on Chrome. So once once that happens,
it'll be even more essential because you're just going to lose out on all of the data you were collecting from there before.

MIKE
That's right. And the clock is ticking all the time.

SAM
Yes. We're moving closer and closer to the privacy protections that we need as users, which just means we need to find new solutions as advertisers that will take all of that into account.

MIKE
Yeah. And also coming back to the social media and how it's evolving. So the first one was privacy concerns and regulations. The other one is social commerce, I think it’s a big part of every major social media platform right now. 

Meta and TikTok are trying to move the purchase behavior from outside of the platform into the platform to make the process as frictionless as possible for the users and also to keep the most data. And because given those privacy changes, they also want to have that in their platform.

SAM
So yeah, they want to keep user data. It's like how years ago everyone was switching from websites to apps to make sure that all the user data was staying within one place rather than gathering it. Now people want to make sure they can stay on the website, keep the users there for as long as possible.

I mean, that's Meta’s Discovery Commerce. Get people on the site so they discover
the next thing they want to buy.

MIKE
And one of the big things related to that is that, let’s say, in The Razor Group. Of course I said that we were operating on D2C stores, mostly on Shopify, but the biggest scale of business was happening outside the D2C channel. It was on the marketplaces, like Amazon. And one of the key challenges was supporting the Amazon sales. But without having these data flowing from Amazon to Meta.

But recently I read that Meta and Amazon had I think some kind of deal that would enable maybe some exchange of the data between the marketplace and the platforms.  So if it's going to happen, it's going to be big because, you know, I think that's the way the e-commerce industry is evolving. It’s evolving more and more towards the marketplaces.

SAM
Yeah.

MIKE
Instead of individual shops.

SAM
And that is please correct me if I'm wrong, but one of the one of the biggest challenges there is making sure that you have enough data to inform those campaigns since it's on the platform because like like you're saying, if Amazon and Meta are making a deal in order to get that data there, that's because if they're just doing all of their operations on Meta, they can't connect the data they would get from their Amazon sales data and use it to inform campaigns.

Which is actually that's one of the things that ROI Hunter that we've been working on is connecting those additional signals from not just a place like, like Google, but from custom sources as well, so that you can bring all of that into your Meta campaigns and enhance something like CAPI.

MIKE
Yeah, great to hear that. And you are clearly ahead of the curve in that area and you are setting new trends.

SAM
Now, one thing I wanted to get into with you in terms of staying informed in the industry, as somebody who comes from a content background like myself, I'm always interested in how people in roles like yours like to keep up with the industry. What are your favorite ways to stay informed?

MIKE
I think one of my of my favorite ways is listening to the podcasts related to our industry.

SAM
Exactly.

MIKE
I think I think that's the best way because podcast is this kind of long form… I don't know, conversation. Yeah that's there is this spark of interaction between the host and the guests that you won’t get in some kind of written interview. So I think podcasts are the best way to gather new information, and stay on top of the newest trends.

SAM
Do you have any any favorites that you listen to? Like, I know I listen to 2X E-Commerce, but beyond that, I'm always looking for more.

MIKE
Yeah, I think when it comes to Meta, I think The John Loomer Pubcast is one of the biggest ones, and the oldest ones. When it comes to broader marketing, I think, I think there is this I think it's called CMO Podcast. I'm not sure already called the names.

SAM
Sounds really familiar actually. Yeah, yeah.

MIKE
Yeah.

SAM
Is it just podcasts? Like if you're, if you're looking to go and research something in particular, like let's say you're looking for new new tactics to try for 2024, something happening on social, would you, would you go seeking a webinar, an e-book, a video?

MIKE
I think on one hand I'm trying to stay connected and in contact with my colleagues from the industry and we just exchange information. And the other area, I think are performance marketing communities posted on social media groups or Discord servers, and this is one of the another trends in social media like the growth of niche communities.

SAM
Okay, niche communities. What like what, what are some examples of what you mean by that?

MIKE
I mean, so, one of these would be like community of Facebook ad buyers or,
I don't know, Google ad buyers or performance marketers, right?

SAM
Yeah, that makes sense.

MIKE
So I would call that a niche community. 

SAM
So really it's all coming  back to the social networks then. It's where you're selling the stuff from networking people on how to sell the stuff. 

MIKE
Exactly.

SAM
You know, speaking of the the e-commerce industry, we've been talking a lot with our clients at ROI Hunter about having a renewed focus on profitability because right now with the with the state of the recession, interest rates, the economy, it's no longer as much of a a growth focused economy. People are looking more for sustainability now. They're looking for ways to have those real world actions affecting their performance. 

What are your thoughts on this? What have you experienced in your roles?

MIKE
Yeah, I think, and also one factor that we need to take into account is that previously, as you said, everyone was focused on growing because the venture capital money was very easily accessible for the companies. Right now it's it's not as easy as it used to be to get funding. So that's why there is this also big shift to profitability.

SAM
Absolutely.

MIKE
And I think in that case, it's more about sending the right data to the platforms, right? Because on one hand you can with, let's say, let's use Meta ads as an example, as a purchase value, you could send, let's say gross revenue that you generated from a given purchase. 

But with little tweaks you would be able to pass maybe your contribution margin over that given the products that you are selling. So that instead of optimizing for the volume, of the purchases, their revenue, then you would be optimizing towards the highest contribution margin possible and then using objectives and optimizations like value optimization for Meta. Maybe you can achieve some outstanding results in that view.

SAM
And I mean, again, not to not keep talking, pitching ROI Hunter, but that's that's something that we've been getting into a lot is really optimizing toward greater profitability by doing that, that data sharing type stuff, getting the margins from your merchandizing department, connecting it with your marketing department so that you can actually filter your products and start promoting them based on the ones that are going to going to have the greatest the greatest gross marg- sorry, the greatest, yeah, Gross profit for your company.

MIKE
Yeah. And I agree that ROI Hunter is a great tool for that because if we didn't have ROI Hunter, then it would require us to, to maybe do some custom solution in-house that will obviously take time and knowing that IT departments usually have other priorities, it wouldn't be as effective as just using ROI Hunter.

SAM
That’s the thing, there are things you can do to find that profitability product by product. But in terms of yes, a scalable solution; being able to actually filter your catalog and be like, okay, let's find my most profitable product and we’ll promote those and bring that margin in to me. It’s, yeah, it's something that is better to have a tool for so that people aren't stitching together the data their entire day.

MIKE
And also speaking of ROI Hunter. 

SAM
Yeah.

MIKE
The things that we did in the beginning at eObuwie and Modivo; this pulling the data using Supermetrics and stitching it together. It's also one of the features of ROI Hunter. And who knows, maybe if we started using your tool a little sooner, maybe it would be even easier for us to have that data available.

SAM
Yeah, now what was your experience like working with ROI Hunter back when you were at Modivo? 

MIKE
I mean, you know, as I said, there was a point when we reached this kind of stagnation point, and we needed to look for some  outside-of-the-company solutions, and I think ROI Hunter was a perfect fit for us, especially given the additional features regarding like passing the margin of the products to the product feed or having this Google Analytics and Meta data at one place, automatically updated, it was, you know, still our dashboards did something very similar, but it was way more convenient to media buyers to have that on the platform and in an interactive way.

And I think the other big feature that convinced us to use ROI Hunter was the feature to customize the images in our feed. And it was a… big, big decision point for us.

SAM
I'm glad to hear that. I you know, the last thing that I wanted to talk with you, Mike, about, which I'm asking all of our guests, is just if there was any advice that you would want to give to e-commerce retailers listening, what would that advice be?

MIKE
I mean, I think one of the most important ones is making sure that your measurement, your Pixel set up, your CAPI set up, your first-party data usage is on on the highest possible level. Because with all the privacy changes, you need to have your your data right in order to achieve basically anything. 

SAM
Yep. If you can't target people correctly, you're not going to sell your products. 

MIKE
And also there will be like a bigger and bigger focus towards the first-party data,
as third-party just basically fades away. And on the platforms, you can see this evolution towards broad targeting automated campaigns. These kind of black box ones like PMax, or ASC on Meta. They are performing very well right now, but, you know, who knows how it's how they're going to perform in the future.

SAM
You got to make sure that you can keep the the data that you need without taking too much away from the users for them.

MIKE
Exactly. Data is the new gold.

SAM
Data’s the new gold. We need to figure out how to use it best.

MIKE
Exactly.

SAM
Well, thank you so much  for taking the time to join us and I look forward to talking with you more in the future.

MIKE
Thank you, Sam. It was a great pleasure.