Automated Transcription:
Tanner Larsson 0:07
Welcome to the Optimized Ecommerce Podcast. I’m Tanner Larsson. This is Matthew Stafford, my business partner. We are your host, and we are excited to be back with you. Today we’re going to cover the current state of e commerce amid this global pandemic COVID craziness that’s going on. We’re going to kind of tell you what we’re seeing across all the different stores that were involved — with our network of business accelerator members. And just let you know what we’re seeing across everything. And then we’re going to share a few predictions and some advice for how you can make the most out of your e commerce business during this very interesting and confusing time that we’re in. So, Matt, what’s going on right now in the e commerce world?
Matthew Stafford 0:47
And so obviously, my part of the business for us is dealing with all the partner stores. We have about 25 partner stores. And Online Shopping is booming. So we don’t have any partners — we take that back — we have one partner that does sell face masks. But other than that, like, we really just don’t have much industry that is serving this COVID thing. But regardless of that, across all of our partner stores, the numbers are way up — not just a little bit. But like the best numbers that they’ve ever seen. We know that part of that can be from the fact that only about 10% of shopping was done online before the global pandemic. And I think what’s happened. A lot of us already shop online. But we’re still maybe considered early adopters. Considering how big the globe is and how many people there are. As everyone’s been forced to go home and work from home. A lot of the things that they used to do when they went to work or after work — now they literally are having to access that stuff online. And so they’re getting used to that type of habit. They’re actually realizing that it saves them time too. And I mean, literally across every industry that we’re in. We’re just seeing it explode.
Tanner Larsson 2:19
Now, we’re seeing four to five times more visitors on a store at any given time. And it’s like Matt said, because there are so many people that — even though there were 10% of the population shopping online, before and now we’re seeing four to five times that number, because they have no choice.
Matthew Stafford 2:36
Yeah, yeah, it’s really forced their hand. And I think also people maybe didn’t trust it before. Now, after two months, going into the third month, they’ve already had to buy that two or three cycles. And so now they realize, okay, someone didn’t steal my credit card. All the other things that go through people’s mind when you first get online, shopping, and they don’t feel comfortable with that. I think the longer that this lasts, it’s going to continue to get better and better for anyone that has an online presence.
Tanner Larsson 3:09
Absolutely. And it’s not just the number of shoppers, and that’s cool because we’re seeing more buyers than ever online. But we’re also seeing that consumption levels are way higher. People are home. They’re bored. And also, people are applying for unemployment. A lot of people are losing their jobs. But there are a lot of people who aren’t, there’s still a lot of money out there. The need and desire to consume hasn’t gone anywhere. They just had to shift their focus from buying it at a store to buying it online. And they’re buying more stuff. I mean with our business accelerator members — inside of our ecom insider program, we’ve got about 500 stores in there. And they’re everything from P.O.D. to widgets to jewelry to diabetic supplements. Everything you can think of is booming, they’re buying more and more of it because they’re at home.
Matthew Stafford 4:06
What we’re also seeing from the companies that run media for our partner stores, they’re saying that the ad, the ad media is cheaper than it’s ever been. So I think what’s happened — I mean, obviously, a lot of the big brands who have nobody in their factories, nobody in their brick and mortar stores, they’re not buying ads right now. People are not buying that stuff. There’s just like an enormous amount of ad inventory, which means the ads, not only are the people buying consumables and the other smaller items, but the ad costs are much cheaper too. So these stores are getting the eyeballs to their stores much cheaper.
Tanner Larsson 4:49
Yeah, and like if you turn your ads off, turn it back on, because we have members who were like, “I turned all my ads off because I thought it wasn’t gonna work.” And then they turn them on. And I mean, we’re seeing record numbers. Last month in March, we had members telling us that their march numbers beat all of their Q1 numbers, you know, just in March.
Matthew Stafford 5:13
Yeah, yep.
Yeah, we have people that are two months into this. They had passed all their first quarter numbers. Yep. So yeah, they’re literally doing. Like we said, record numbers.
Tanner Larsson 5:30
The pandemic is bad. It’s scary. It’s bad for a lot of things. But from the e commerce perspective, it’s really a good thing. Like it is, this is changing the way we do business. And there’s also more things like, if you’re in the US, there are lots of different available options for you. Well, actually not just U.S., but Facebook and Google are now doing advertising grants, where they’re going to be giving free ad credits to different small businesses to help them advertise and keep making money during this time. So that’s free money to advertise. If you’re in the US, there are federal monies available for you to help float your business. There is the EIDL – Economic Impact Disaster Loan, which also has a grant component with them. That was where they had the emergency 10K, and they still have that. Now that actually got exhausted with the first round, but they’ve released a whole other batch of money, and they’re doing it again. And the EIDL money is up to $10,000. Grant. Matt and I got our grant about sometime last week, right, we got the 10 K. Yeah, and we know a lot of other businesses that got that grant. And then on the back end of that there’s a loan option where they’ll give you additional money for a ridiculous like 2% interest rate. Then there’s the Paycheck Protection Program or PPP, which is another round of stimulus. Another loan option which is a forgivable loan option if that money is used to pay rent, inventory, payroll, and other operating expenses for your business. So you can use that money to keep growing and keep your business open. And again, the part that may or may not be forgivable is around a 2% to 3% interest rate amortized over 30 years. But a big chunk of that money will be forgiven if you use it for business purposes. And this is unprecedented levels of money access, being just dumped out for small businesses and you guys qualify. If you pay U.S. taxes, you can get those kinds of loans.
Matthew Stafford 7:27
We were on a webinar with some other business leaders, and they talked about — I’m gonna mess up the number. I think it was 70 million people who are employed by small businesses in the US. 77 million. And yeah, so the chances they said that, if the businesses are closed for seven days, about 30% of them won’t reopen, closed more than 30 days about 73% won’t reopen and so this money is money that the government knows that they have to do in order to help the small businesses who provide, you know, income for 77 million US citizens. So it’s not like you sent news this morning and you should use this money and stimulate the economy, and your business and take advantage of it.
Tanner Larsson 8:29
Absolutely, they’re gonna give it out to small businesses anyway. And this next round — they just got funded for — it is making the restrictions on the bigger businesses that we’re trying to get it even harder so it’s easier for small businesses to get it. We have lots of our business accelerator members who have already gotten funded for their PPP and EIDL. And you know, gotten significant loans — $100,000 or more. So, it’s available to you but this combination of massive online shopping more so than ever in history — ad inventory being low ad costs being lower than ever with the same levels of conversions and tracking that we’ve never had before. Then you factor-in the new availability of ad grant money and everything else. Then you got federal money and loans and grants and forgivable money coming out. This is like the perfect storm.
Matthew Stafford 9:22
Yes, yeah. There is really not a better time. Well, I’ve personally never seen one. But when you look at all the different aspects going on too. It’s not just saying this, but every single person that we’re talking to, we know that the money didn’t go away. It’s just shifting hands. So it’s going from the brick and mortar, and the real estate market, all the other stuff like commercial real estate, all those things are now going back into online, online stores and the e-commerce world and so honestly, there couldn’t be a better perfect storm for what we are doing.
Tanner Larsson 10:00
True. So the prediction, not just prediction but like all signs point to and everything is — this is pretty much the Gold Rush all over again for the internet. The early internet Gold Rush days were like ’97 to 2003 range. And that just was crazy. And then it kind of died off. And we had another kind of boom in terms of shifting of wealth back in the next recession in 2008. But this is literally the perfect storm with a gold rush attached that is the most massive transfer of wealth, I believe is going to happen in the next 12 months that’s ever happened in history in different areas of the globe at one time.
Matthew Stafford 10:44
This is every area of the globe all at once.
Tanner Larsson 10:47
And so this is your opportunity. Now, to be fair, and like this is a great opportunity amidst the pandemic. Now there are some downsides of what we’re seeing as well in the ecom space. Some of Those include, if you are drop shipping from China. Well, China obviously is still getting turned back on after they’re shut down their manufacturing capacity is only at about 50% to 60% of what it was. They’re still getting back up and getting back in operation. So they’re manufacturing down, which means backed-up orders and stuff. Also, if you’re shipping out of China through drops, through E packet shipping or things like that. I saw a video the other day of China’s like e packet warehousing stuff where they sort the mail and they’re literally walking across mountains of mail. It’s almost like swimming in mail. So it’s backed up. It’s already a four week delivery. Now it’s even slower. Air shipping out of China through DHL, FedEx or anything else. Cargo shipping shut down. Everything’s just a little slower now, doesn’t mean it doesn’t work. It just means it’s slower. Matt, you were talking to some of our fulfillment guys, and they’re having stuff too, right?
Matthew Stafford 11:53
Yeah, so the fulfillment houses here in the US. Literally all the brick and mortar stores that are no longer open are now creating these online presence because people aren’t coming to the stores. And so, they’ve been forced to send their product to fulfillment warehouses and we have personal friends and they’re on three different ones. And every one of them is saying the same thing that the numbers are through the roof right now.
Tanner Larsson 12:21
Yeah, there’s planning. They’re firing as fast as they can. Yeah. And so with this transference and this gold rush, there’s going to be some breakage. There’s going to be some you know, unique problems that pop up — things that you’re going to have to deal with. But that no way diminishes the opportunity that’s in front of us here for e-commerce and online business. It’s not just econ. Anything online, from services to products to whatever you can dream up for an online thing is just going to be shifting now.
Matthew Stafford 12:51
I just wanted to say that this podcast is even more relevant than ever because we don’t just have like one or two brands where we talk about what we do and how we fixed our brand. But we’re literally 26 partner stores, almost 500 ecom stores in our education, the business accelerator. Between all that, like we really literally have a pulse on everything to do with e-commerce. And we’re going to share it as we do these episodes. So I really honestly can’t think of a better time.
Tanner Larsson 13:34
Yeah. So guys right now the biggest thing we need you to do, if you liked this episode, you want to see more of what we’re going to be doing. We’re going to keep releasing new information as we have it. And we’re going to be teaching you a lot more of our optimization tricks. But right now, you need to go — wherever you are — if you’re on Stitcher or iTunes or YouTube, whatever you’re doing, subscribe to what we’re doing. Leave us a review, post a comment, tell us what you think. And then if you need direct links to how to find all this stuff for the podcast and all of our resources, go to BuildGrowScale.com/podcast. And with that, guys, we’ll see in the next episode.
Matthew Stafford 14:04
Alright guys also if you like this, please leave a comment or share this with your friends and then that way, Tanner and I can go through the comments and reply. And if there’s something that you’d like us to give you an update on, let us know we’d be happy to share it.
Tanner Larsson 14:20
See you guys!
