25 Lessons to Learn Taking 8-Figure eCommerce Business to 9-Figures Brand

 on 
 June 12, 2020

To get from 0 to 7 figures requires to find a product-market fit and master one traffic platform - Facebook.

To get from 7 figures to 8 figures required to speed up my execution, expand vertically on what I’m working on.

But to get from 8 figures to 9 figures requires learning multiple platforms, people management, hiring agencies, investing a lot more into learning & changing my mindset...

It’s a challenge I’m willing to accept and this article will be showing you what kind of lessons I (or you) would need to learn going from 8 to 9-figures.

In any case, it’s a fun challenge, and I’m super happy to share it with you.

1. Invest Into Consulting - You’ll Get There Faster

There’s a lot to be learned when you’re scaling the business to 9-figures. And it’s almost impossible to know all the things from the get-go.

Especially not these small things that can make the whole difference.

I’ve experienced it myself with media buying. I’ve seen some junior media buyers who would know how to do things from the technical point of view, but when they encounter a challenge - they crumble.

That's where experience plays a massive role.

And that’s what you’re paying for consulting - getting these insights for a few thousand dollars that took them years to learn.

At this moment I’m investing into consulting with influencer marketing experts, PR consultants, youtube ads, & data analysts.

I’m spending around $5k per month on consulting alone, but it’s well worth it.

2. Hire Specialized Agencies - Save Time On Management

Building teams in-house takes time.

Unless you want to put the foot off the pedal - you really want to hire specialized agencies that know what they are doing.

Since most of the platforms are different, you want somebody who can control the whole funnel. Not just part of it and then blame you for not producing results.

I’ve so far hired youtube and pinterest agencies. They are great at media buying, but when we look at the results, they don’t look super good.

And what response do they have for us?

“It’s the landing page. It’s the creative, etc.”

For example of our agency, we either have control of the whole funnel or we don’t take the clients on.

So be looking for the agencies that will do it all for you, rather than just one part and then complain they didn’t have control over things.

And if you do find this kind of an agency… Give them a performance based deal. They’ll work their asses off to make sure they deliver the results you’re looking for.

3. The Importance Of Data Is Growing - Act Now

So far my media buying was super primitive.

I look at the ad spend on Facebook and see the revenue on shopify. Is it over our target ROAS? Let’s scale it up.

Is it lower than our target ROAS?

Let’s scale it down.

That’s it.

Obviously, we have calculated our LTV, the frequency of the purchases, when does it happen etc.

However, now we’re expanding into other channels and let’s say that attribution is not as straightforward as it used to be.

And the more channels you’re adding, the more confusion there’s going to be. At this moment we run ads on google, youtube, and Facebook & IG. 90% of our budgets go to Facebook & IG, and whenever we increase budgets on google - we only see the difference in our bottom line.

Platforms lies. You need to make sure to spot which ones lie the most.

4. Direct Response Vs Branding & Changes of Creatives

To get to 8-figures in yearly revenue you can only be using direct response ads without any problem.

In fact, we got one of our clients to $6.6M in monthly revenue using only direct response ads.

Obviously, COVID-19 has affected it big time, so it’s not only the ads that helped us get there.

In any case, to get to another level - you need to start changing the way you create creatives and move more away from direct response to brand response ads.

These are far more difficult to produce and will need far more resources to do it.

Our in-house creative team wasn’t able to pull this off, so we decided to outsource it to an external agency and for the first time we paid over $50k for one ad.

Moving forward we’ll have to be thinking about more of these ads and will invest even more.

5. Learn How to Run Meetings Effectively

I’ve written an article about how Tim Ferriss’ marketing has affected me running my meetings - or rather not having them at all.

Yet, once I realized the importance of them and the performance increase of my entire team - I’ve decided to become good at it.

Meetings are one of the “mediums” that you’re going to be able to run your company successfully & be better at it.

Here are some of the questions I want to answer before the meeting:

  • Why are we having this meeting?
  • Do we want a decision, do we want to inform, or do we want to make clear to ourselves what we should be doing?

After the meeting, if the decision was made, this is what we want to do:

  • The name of the person accountable for carrying it out
  • The deadline
  • The names of the people who will be affected by the decision and therefore have to know about, understand, and approve it - or at least not be strongly opposed to it. The names of the people who have to be informed of the decision, even if they are not directly affected by it.

I’ve taken these examples from Peter Drucker’s book - Effective Executive.

Also, it’s important to note that I’m not meeting with every team player. I’m only meeting with the leads of the team, going over the KPIs, help them solve their challenges, & making decisions on growth.

6. Hiring Experienced People With Ability to Adjust Quickly

People who took you to the 8-figure level will not necessarily have enough experience getting you to 9-figures and expect you’ll have to be hiring.

When we reached $6M in monthly revenue, we started to see more clearly where our weak spots were - and they were mostly in data analysis side.

After consulting with people in the industry, we’ve decided to take a leap and hire someone who already has experience working with 9-figure business.

Yet, there’s one thing that’s very different from an established company and a quickly growing one.

Things are moving quickly.

The need to adapt is insane. Platforms are making changes quickly. Creatives change quickly. We need to adapt rapidly.

So when we interviewed the person for this position, we asked her what was the turnaround time for a product launch in one of the big companies she has worked with. Her answer: 9 months.

Mmmm, that’s only 10x the time we usually have.

We have a product launch strategy and are able to execute upon it within 3 weeks.

So even though having experienced people would be beneficial - it’s  important to see whether they’re able to execute quickly and adapt even quicker.

7. Create a Fast Hiring Structure

The amount of people we need to hire every month is insane. We hire at least 5 people within the agency and then another 5 for each one of the clients.

We’ve built an entire funnel, with pre-qualification, interview, and second interview process to  get only the best candidates for each one of the positions.

And this will only get worse, especially with the growth we’re experiencing.

So when you reach the 8-figure mark, start thinking about hiring an HR person and develop a system to be prepared to hire more and more people.

On the flip side - be ready to be letting go of people fast. If they are not performing at a high-level, they’ll definitely be not able to get you to 9-figures. They actually might slow things down for you by quite a lot.

8. Don’t Slow Down

At this point we’re experiencing quite a bit of growth.

But as we include more and more departments into the entire ecosystem, we’re inevitably slowing things down.

And slowing things down is like a kryptonite for Superman. We’re losing one of the superpowers that got us there.

And it can be very costly.

So in order not to slow down - we’re decentralizing most of the decision making process. Every department can make their own decisions & only occasionally they need to consult with leads of their department.

It’s make it or break it at this point. And it will remain the same until we reach 9-figures in yearly revenue.

9. Team Structure

Team structure will be more even important here.

After researching 9-figure ecom businesses on LinkedIn, I came up with the following structure.

I divided the teams into 2.

Offense vs Defense team.

The offense team is a paid acquisition team mostly with the help of a PR person. The defensive team has everything to do with the website, email marketing, UX/UI etc.

Here’s how it looks like: (PHOTO)

Offensive team's KPIs are - cost per acquisition & scale.

Defensive team - LTV, AOV & branding.

This is an ideal structure. We don't have the entire team for it, but we're getting there.

10. Adding Additional Channels

So at this point you have 2 options to choose from how to grow your brand.

  1. Grow with what you’ve grown so far & double down on it.
  2. Scale horizontally to various other channels.
  3. Do both at the same time

I’ve chosen the 3rd option and started scaling both vertically and horizontally.

The reason why I wanted to do both - is to protect ourselves from having a one-platform business. At this moment 90% of our marketing budget goes towards Facebook & Instagram.  as 90% of our budgets go towards Facebook & Instagram.

We've started investing into SEO to provide us some stability, have hired a PR consultant to build an in-house PR machine.

At the same time we’re hiring an affiliate marketing manager and have youtube ads running (which we have cracked yet unfortunately).

As for FB & IG - we're expanding towards influencers and planning some celebrity collaborations.

How can I manage all this?

Letting go of control, outsourcing and focusing on what works already.

11. Performance vs Branding

Direct response, discount and all the other marketing techniques can boost your sales over the short-term.

However, if you do want to be building a brand - you’ll slowly need to be moving away from it.

In the book The Long and Short of It the authors show how discounting your products will increase the price sensitivity & your customer will be expecting that.

And at some point you’ll have to start making these sacrifices. Not going straight into the branding route, but rather by building it little by little.

In 2-3 months we’ll start dedicating 90% of our budgets to the ads we do have now and another 10% to the branded ads. We'll slowly be moving up to 40/60, which this book recommends in the long run.

Why so?

Branding increases the emotional connection your customers will have between you and your brand.  Which means higher conversion rates, higher LTV and happier customers.

And what is branding?

It’s every touch that your customers have with your brand. Be it an ad, email, SMS and all the other platforms you connect with them.

12. Exchange Discounts With Product Launches

One of the brands I’m working with has a product launch every month.

Because of that, we only do 4 sales per year and our ROI gap is much higher than the other 2 brands I’m working with.

That’s why whenever you can - start investing heavily in new product development. Not only will you be able to widen the ROI gap, but also be able to get new customers by offering a wider product range than you have right now.

I would not do that more than once a month though. As of writing right now, we’re preparing for 10 launches in the next 7 months.

In any case, I see product launches as a snowball effect.

13. Break Down Your Customer Personas

As we started scaling having only one customer persona - we’ve looked deeper into our customers and realized...

We have a lot more than 1.

We have 4 very different customers who are buying from us. Very different looks, stages of their lives & psychographics.

So we're starting to separate them and speak directly to them.

When I analyze massive brands like Gucci - they have multiple customer perso

Go on their website and see how many photos they use of different color, size & age of women.

14. Celebrity Endorsements Are Working - Invest Into Them

One of our major “enemies” in marketing is - Proactive.

If you look at the ads they create, or their whole marketing campaign - it’s all based on the celebrities they make deals with.

When it comes to celebrities, people buy whatever they are told to.

It's simply because of trust they've built.

I’m guilty of this too. I’m a big fanboy of Tim Ferriss and I was buying into his ideas for a long time without questioning them. You can read my full article on it here. LINK

Yet, bigger celebrities are not as easy to get their hands on. You usually need to go through their agents and sell your brand.

You need to invest at least $50k upfront for these kind of collaborations.

The best time to do it - when they buy a house or an expensive car. They’ll want to recoup that money from somewhere and they’ll be more likely to make an agreement with.

You can go one step further and ask them to give you their account to run ads from. For this kind of a deal, you’re likely to be paying a percentage of the ad spend, which should be around 5%.

15.  Advertising On TV

TV is not dead.

It can still reach far more people than any of the digital platforms.

Although it’s for sure losing its’ audience, its’ branding abilities can not be ignored. TV is still the most powerful advertising medium.

Why?

Think about how people are using digital platforms like youtube. They know exactly what they are looking for. They want to either learn something or be entertained.  They’re usually very much in a conscious mode.

But how do people watch TV advertising?

Their defense mechanism is completely off and that’s why TV ads are so powerful.

Yup, we’re dealing on another level here, but this is what can work.

We’re not expecting to do any TV ads yet, but I’m sure when we’re closer to 9-figures we’re going to consider it.

16. Delegating More Efficiently

This is a major mindset shift that I had to make.

From “that’s ok, I’ll do it on my own” to  “I have so much to do, there’s no way I can make it all work”.

And because of that, I always need to be thinking about what I can outsource and what needs to be done by me.

To make this major shift I had to hire an outstanding project manager to always be finding people who can take it off my plate.

One of the major shifts here was to have more meetings to make sure everyone understands what their role is.

17. Changing the Circle of People You’re Hanging Out

“You’re an average of the 5 closest people in your life”

I’ve seen it work in my life many times.

That’s why I’m very conscious of changing the circle of people I’m surrounded by. Me & a few buddies of mine who are going for 9-figures in revenue have created a mastermind where we help each other to get us there.

It doesn't mean I'm not hanging out with my other friends.

I'm just more conscious of the people who can get me to 9-figures & try to create partnerships with them.

Another reason for that - the challenges a $30M/year business has are very different from the $8M/year business.

At the moment I’m choosing which mastermind to invest into that would have the highest concentration of 9-figure entrepreneurs.

From what I’ve seen, these masterminds cost from $30k all the way to $100k.

18. Start Thinking About PR Moves

Up to this point we were able to get PR with the agencies we decided to work with.

They didn’t drive much revenue, nor did it drive much traffic, yet, we want to be starting generating more brand awareness for our brand.

We’re now creating our internal PR department to be able to control the message a bit more.

As I mentioned, PR didn’t generate much revenue, nor traffic, so don’t be hooked up on it.

Unless…

You do some big PR moves that would have a trickle effect across multiple magazines, and platforms, which we’re planning to do.

Why did we decide to build an internal team?

I’ve consulted with 5 mid-8-figure entrepreneurs and they all built an internal team. Doing it so - as they are able to control the message better and reduce costs for this department.

19. The Fundamentals Don’t Ever Change

Here’s what changes moving form 8-figure business to 9-figure business:

Platforms.

Systems.

The size of your company.

But you know what doesn’t change? Human psychology.

No matter how much revenue you’ll be generating, you’ll still need to understand why your customers are buying. Their pain points, their deepest desires and objections.

It's likely not going to change for another decade.

Unless we experience symbiosis and become one with AI... Which according to Musk is very likely to happen.

19. Solve One Problem At A Time

I’m not the best example of this one, as I usually have 3 problems to solve at all times, for each one of the clients.

However, I do solve one problem at a time. And by one at a time I mean 2 - 4hours.

Unfortunately, I don’t have the luxury of taking 2months to make a decision. That’s why I hire consultants to absorb all the information and to help me make the best decision in the shortest period of time.

I try to take a week off every 3months to plan my next 3 months ahead and prioritize my challenges.

At this moment I have these 3 that I want to solve: 1. Attribution models so we could be investing more into different media channels 2. Build out a PR department 3. Build an affiliate marketing department.

20. Take Time to Think Things Through

My execution time went down from 80% to 10-20% now.

Most of the time that I spend now is consulting with others, meeting my team - thinking things through.

I do most of the thinking on paper & by writing this blog.

This is one of the reasons I write here. It helps me make better decisions.

I book time on my calendar for 1-2 hours to write about one certain challenge I’m facing to look it through many different aspects.

I have different “mental models” prepared, which allow me to look at it from different perspectives... And offer me unique solutions.

When I have a solution, I usually reach out to my network of 8-figure entrepreneurs and ask them to test my thinking process.

I’m making many decisions and I want to make as little errors as possible, although I’m not too fussed with the small ones.

21. Operational Excellence Is Super Important Here

I’m terrible at operations, yet I was doing it for almost 2 years. I thought that this is something that I have to be doing because no one else would like it…

Until I realized that there are people who love this part of the business. And that only happened when I started to work with my project manager, who is crushing it.

The only thing I’m afraid of is - she’s not super experienced in the digital marketing space, and relies on me making lots of decisions.

Yet, she’s amazing at delegating and getting shit done, as well as getting teams together, and pulling all the resources together.

If you don’t have a director of operations - get one now. You don’t want to wait until shit hits the fan.

Create a system where all the KPIs from the team are sent to you and give you an overview of how each department is performing. This will make your work much easier.

22. Don’t Get Overconfident, There’s A Long Road Ahead

Ok, you’re managing 8 - figures in revenue.

That’s awesome and that’s a great accomplishment.

Yet, there are way too many things that still need to be done. Stay humble, keep learning, keep consulting and keep moving forward.

If you stop now - your competition will take you over.

And you don’t want that.

The way I’m seeing it is that I’m in a “teenage” phase and if I want to become a “man”, I need to go into 9-figures no matter what.

I can’t imagine myself going into 10-figures now, but it could be a possibility in the future.

23. Empower Your Team to Be Searching for Solutions

As much as I wanted to - there’s no way I can read all the books, listen to all the podcast, or consult with all the consultants.

No matter how much I wanted to, the processor above my shoulders is not able to process the amount of information that I need to process.

Because of that - I want my team to be looking for solutions to solve their immediate challenges themselves.

I ask my team members to be talking to other experts in their respected areas of expertise, go to masterminds, create their own masterminds & be on the lookout for the next new thing.

This shows me whether they’re going to become leaders or not.

25. Here Are the Books to Read

What I’ve read up until now - is persuasion, copywriting, & tribe building. Everything that has to do with direct marketing.

Going forward, I do realize I need to start learning very different things.

Here are the books I’m reading right now to get us to 9-figures.

Robert Heath - he’s covering advertising that cuts through the cluster and ensures we’re winning some headspace by doing that.

Defining Advertising Goals for Measured Advertising Results

How Brands Grow 

Long-Short: Balancing Short and Long Term Strategies

Media in Focus 

Econometric Modeling 

Blogs

ipa.co.uk ; https://www.marketingweek.com/mark-ritson/

The Long (or short) Road Ahead

When I did my 2019 analysis - I gave it a name - a year of “learning”.

I named 2020 a year of “scale”, thinking that we’ll scale our revenues by 2x. What I didn’t know was that we’ll scale 2x and another 2x in the first 5months of the year. And it seems we’ll be hitting $120M+ for 3 clients I’m in charge of digital marketing.

Which means that next year will be a year of the "2nd wave of scale. We're very likely to be hitting $100M for each one of the brands & I'm in a unique position to help them all do that.  Whatever I’m going to learn - I’m going to apply for each one of them & scale even quicker.

And to get there quicker - I have to be learning at a much faster pace. Which is what I’m planning to do.

And you have a unique opportunity to follow this journey on this blog (and my email list)

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