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Episode Transcript — Increasing CTR and Engagement on DPA ads w/ Snappic.io CEO Edwin Hermawan
00:00 Announcer: You're listening to the Spend $10K a Day podcast, brought to you by the performance marketing experts at MuteSix. This is your source for cutting edge insight into the world of online advertising. From the team with more Facebook case studies than any other agency on the planet. Here are your hosts, Steve Weiss and Stewart Anderson.
00:32 Steve Weiss: Hey, everyone. Welcome back to the Spend $10K a Day Podcast. Another beautiful day in Southern California. Today, we have an awesome guest. We have our Facebook shopping feed expert, Edwin Hermawan. Edwin is also the founder of Snappic, one of the leading Shopify apps for streaming user generated content into your product feed. Edwin, thanks for joining today, man.
00:58 Edwin Hermawan: Thanks for having me, man.
01:00 SW: Cool. Everyone, our whole audience, they are super excited this holiday season about product feeds. It's the fastest growing area of Facebook ads for e-commerce sites. It's where the most growth is and we're super excited to have you on our podcast just to share your brain. Tell us a little about yourself, your experience, and then tell us a little more about what you're working on with Snappic.
01:25 EH: Yeah. No, for sure. My wife and I, we run the company together. We ran an agency for a very, very long time. We did lot of design development and then one day, we had a client who was super, super big in Instagram and asked us to go into the marketing route and we were a little bit hesitant at first but we got into it. We were one of the first advertisers on Instagram and we realized that you could really make a lot of money doing this whole social media advertising on Instagram and Facebook. And we always found, as your listeners, as you personally probably know, the action really happens, it's retargeting and really where the money is, is with DPA ads. We found that out very quickly and we made that one of our focuses. That became our primary focus, our primary obsession for a very, very long time. And that's how Snappic was born.
02:35 SW: Cool. Tell us about the solution that Snappic provides. Obviously, the biggest pain point, I feel, in product feeds is you're taking merchandise, AKA, merchandise images, from your website and putting them into an ad. And maybe those images, they don't really look the best for ads. They're not gonna get someone to stop what they're doing and click over and make a purchase. Tell us how Snappic became the solution for number of large e-commerce brands to help really increase the click-through rates, increase the conversion rates on Facebook.
03:11 EH: Yeah. No, I would love to do that. Basically, what Snappic does is instead of using your product detail images in your DPA ads, in your product feeds, we use your Instagram images. That pair of shoes that normally, when you retarget, it's against a white background. Instead of having that boring image, you have the image of the shoes, the same shoes that are at a party, that are out going somewhere, that it shows them in the lifestyle. Because for a lot of our brands, let's be honest. That's what they're selling. They're selling shoes, of course, but really, it's the lifestyle. If that's what they're selling, that's the image that they should be using. The second really cool thing that we do, we call it our promo feature. With all of our stores, we keep live track of inventory. And the minute anything gets low on inventory, the ad will live update in the system, the feed will live update and it'll start saying, "Only five left", "Only four left."
04:15 SW: That's cool.
04:17 EH: Oh. [chuckle]
04:18 SW: It's a really cool feature.
04:21 EH: I can't tell you how many times my wife and I... We've been in a store, we've been thinking about something, and they're like, "Hey, this is the last jacket we have in your size." And if I'm on the fence, it's a done deal. [chuckle]
04:38 SW: I wasn't really aware of that feature. Just to clarify, it actually will pull the amount of product left in the SKU and take that amount and put that inside the ad to almost show scarcity, "We only have five left in your size," or it would actually show that somewhere in the ad or in the image, correct?
05:01 EH: There'll be a little ribbon in the lower left hand corner that will say, "Only five left","Only two left," and it's updated in real time. We're the only ones doing it. We're the only ones on the market. It's a very sophisticated technology but we saw the value of it.
05:20 SW: Wow, that's amazing. It's from a scarcity mentality, when you're running product feeds, that's an amazing feature. Tell me, if I'm an newcomer brand, I use Shopify, obviously, your tools and your system only works on Shopify. How hard is it to integrate Snappic? And let's say, how hard is it to make sure that you don't have images streaming from Instagram that you don't really wanna use, like, "Oh, that's not an image I wanna use" Is it really hard, the integration? And also, how do you make sure that you're not actually using images... Police your site, make sure you're not using images that are against Facebook ad policy, etcetera, etcetera?
05:58 EH: Yeah. No, for sure. We integrate on multiple platforms now. We're on Shopify. We just finished Real Commerce. We are on Magento, both Magento One, Magento Two. But the way that we control that, to make sure that you're not putting out a bad image or something that's against policy is, we take down, we pull down your Instagram feed, and whatever post you wanna use for that particular project, if you're selling a t-shirt and you see a post that has that t-shirt in it, you go ahead. You click on the post, you tag it with that product, and then, that's the image that we're gonna use. Everything is 100% in your control. The integration is completely seamless. You just go to the website, you hit "Try it now." You get started on our 14-day free trial, and I think the last time I clocked it, it was two minutes and 38 seconds from start to end.
06:57 SW: Wow, that's really, really cool. And I guess for right now, you only integrate with Instagram. You're not integrating with other user-generated traffic places, like Pinterest or anywhere else. Right?
07:08 EH: Currently, we're focused on Instagram because that's the animal that we came from. We cut our teeth doing Instagram marketing. That's where we are at the moment.
07:23 SW: Cool. That's really cool, man. I love the feature. I never knew that you had the promo feature on that. Now that I'm keenly aware of that, that's something we're gonna start playing around with and really leveraging. That's awesome. Number two, as you know, Facebook has made a lot of changes over the last couple months to the dynamic product ads. Now, you can run dynamic product prospecting ads. You can actually take your product feed that you're building and Facebook will actually show your product feed to people most likely to do the converting objective that you're setting up in your prospecting campaigns. How does that impact your business? Do you see a lot of advertisers who are using Snappic start using your shopping feed technology to run prospecting ads? Tell me more about that, about how your technology starts integrating with the new Facebook ad features.
08:18 EH: I'll be honest. I run it myself. I've done the prospecting ads with our feed and all of that myself. I still haven't seen the best results from it, compared to the normal prospecting ads that I've run in the past. Where I've seen really extremely good results are actually with the collections ads, and using our product feed with that collection format. What I mean by that is you take a video, everybody likes it. You've proven out, that's the main hero. And then for the collection, you drop in our product feed, that has all your Instagram images with your products. What ends up happening is, when they look at the ad and they click on the collection, they're taking the page that basically looks like a shoppable Instagram.
09:19 SW: Wow, that's cool.
09:21 EH: Yeah. The click-through rates are higher, the conversion rates are higher. Everybody's happier, 'cause it's just better looking.
09:31 SW: We run a lot of collections right now. Collections probably are best converting. Earlier, on Skype, we were talking about what is our homerun CTR conversion rate for dynamic product ads. A good DPA ad for us is around 3% CTR, and then, obviously, we feel like once we have really good CTR, then we can scale that audience, 'cause that's an early indicator of ad relevance score. Facebook's gonna open up to more and more people, and hopefully, if we see the conversion rate of that CTR, we're gonna try to scale it. But tell me more about just comparing apples to apples, Snappic versus regular merchandise images. What kind of hike in CTR have you or some of your partners who are using Snappic have seen?
10:20 EH: CTR-wise, we've seen just if I take a regular product feed, products against white versus our product feed, the social images, on one our brands, we've seen 39.9% increase in click-through rate. On another store that used our promo feature, when they integrated the promo feature for the first time, we actually saw a 2X. We saw a 2X spike in click-through rate. They don't have that much in stock, and so, almost all of their products started to have that little watermark and ribbon, and the click-through was just incredible. It just skyrocketed, with that particular brand itself.
11:08 SW: Cool. One other thought is, as you know, Facebook is coming out with a lot of those different types of ribbons. They're coming out with discount codes. They're gonna be offering what we call the DPA offer ads. I don't know if they're specifically connecting to inventory supply, which I think is the key feature of Snappic. I didn't know that. I guess I didn't realize that that feature existed. But how do you see Snappic integrating with some of Facebook's new DPA features? Being able to do some stuff in Snappic and some stuff in Facebook.
11:46 EH: With that, the integration is pretty simple because we have our feed, and it will just generate the image, and then Facebook can overlay it on top of ours. The main thing though is that, I've played around with it. I've tried it out myself. A lot of the overlays have to do with price and then price cuts. And we've found that a lot of our customers, a lot of our clients, especially like women's wear, they try not to focus on price as much because once they start focusing on price, it almost becomes a slippery slope, and a lot of our brands, they try to maintain a lot of brand integrity. I could see where the new features, they work for a lot of certain brands, like if you sell electronics or if you sell things that are very practical and handy that you use a lot. But for a lot of our brands that do clothing and whatnot, I haven't seen such a good response from them, especially from the brand owners.
13:00 SW: Cool. That's the feature that I think that a lot... That's the pain point that a lot of retailers are trying to really figure out is, how much is too much discounting, and deals. If you do too many deals, you're gonna destroy the urgency that's actually in the deal when you run the ad, And I think we're always trying to figure out how many deals is too much, what is a pricing strategy that you could use for obviously, the holiday season coming up, but I think that's something that we discuss, it's probably the top of our discussion as a team every week is, what is the strategy around price testing. There's not one that fits every single brand, I'm sure you'd agree.
13:46 EH: It's really one of the hardest questions out there, because as a brand owner, you want to drive the sale because you have a sample set and all of a sudden, you just have this huge spike in one day, and it becomes... It's like "Aah, I want that every day."
14:05 SW: But it's not sustainable.
14:07 EH: I know, that's the problem. To me, that was one of the reasons why we made from our promo feature because there are ways of driving urgency. Sale prices, of course, are a way of driving urgency, just no matter what, but it takes you into that conundrum. How many discussions have you had with people that are, "No, I don't wanna do the sale." [laughter]
14:35 SW: Dude, 100%. You know the parallel analogy that I use? I love chocolate chip brownies. I love brownies with walnuts that are really hot. You heat 'em up, and there's a chocolate inside; I love brownies. There's a bakery in Santa Monica that I go to, love the brownies there. I know that if I eat brownies every single day, I'm not gonna be as good looking as I hope to be. I know that I could only have a brownie once a month, twice a month, and it's very similar to running sales and deals. If you eat that brownie too much, you're gonna hurt your business. If I eat that brownie too much, I'm gonna hurt my body. I use that parallel analogy of me and my brownies with e-commerce stores and running too many sales and deals. You wanna make that deal and that sale a magical experience. You want people to see the value, people to really enjoy the experience. But if you run it too much and you keep hoping to get X amount of value out of it, the reality is, you're not. And I think that's something that we see as we try to really focus on how do we make products work and scale without doing too many sales and deals.
15:48 EH: I totally agree with you because the trick is scale. Because the trick is scale and consistency, because anybody can have a good day. On Black Friday, everybody has a good day.[chuckle]
16:04 EH: Right?
16:04 SW: Yeah.
16:04 EH: The people that post Black Friday numbers consistently, if you could post Black Friday numbers consistently, it would be out of this world.
16:18 SW: But the reality is, every day isn't Black Friday, and I think most of the listeners to this podcast and most of the people I talk to on a daily basis, my closest friends in e-commerce, they all say one thing. They're like "Steve, I wanna scale but I also want what we call predictable revenue. I don't want spikes down, spikes up." Everyone wants to be able to, in some way, shape, or form, make an accurate prediction based on this data what they're gonna do tomorrow, the next day, and the next day. And I think if you're running too many sales, you make your business very, very, very unpredictable. I'm sure you would agree with that. [chuckle]
16:58 EH: I 100% agree; you're preaching to the choir; hallelujah.[laughter]
17:03 SW: Thank you, and keep that choir going. But one other interesting point I want to bring up, because I look to you, Ed, and you're a guy that when I have questions about, beyond being a close friend, when I have questions about product feeds, I usually come to you. You have a tech background. You know product feeds in and out. You build technology around product feeds. Share with the audience what you think the future of product shopping feeds is and dynamic products. I know we're getting a lot into building customized product feeds based around editor's picks, time of the year. Tell us a little bit more about strategies around building customized product feeds.
17:47 EH: The strategy behind building successful product feeds, as basic as it sounds, is patience. What I mean by that is, if you've ever tried to make a product feed by hand, it is one of the worst experiences ever. You get so frustrated and if you have to do it on a Friday in the afternoon, there's nothing like it. Right? [chuckle]
18:16 SW: No, it's awful. It's not fun.
18:18 EH: It's awful.
18:19 SW: Yeah.
18:20 EH: Yeah. What I see as the future of product feeds, of course, is user generated content. Because, the whole point of... You have to think of it like what triggers a DPA ad? What triggers a DPA ad is that, I've either looked at a product, I've added it to cart. You think about the customers. You have the customer that's all in and is gonna buy. Alright, that person is already sold. You have the customer that's just a looker, that one's lost. Don't even think about it. Then you have the one that's in between. That's the customer that's looked at it and still not sure.
19:11 EH: What that means is that, that person is humming and hawing and they're like, "Oh, maybe I should, maybe I shouldn't." And really, what they need to see, they need it to be relatable. If they looked at a jacket and then they see one angle of the jacket but then they see a photo of someone that looks like them, or lives the same lifestyle as them or someone that lives an even awesomer lifestyle of them wearing that jacket, that's what's gonna take them over. Like user-generated content, it gives them a second sense of perspective. Once it gives them that second perspective, that second look and that lifestyle je ne sais quoi, that hard to capture value.
20:08 EH: The second thing that I see that's very, very crazy more has to do with the pixel firing. For example, if I'm looking at the product, I'm pretty sure, it normally just fires off the product ID of that t-shirt. But what if instead of that, I had a pixel fire the product idea of the t-shirt and then four other mock product IDs of that same t-shirt at different angles.
20:54 SW: Interesting. Tell me more about this. How would set something like that up?
21:00 EH: Literally, it would be... It's very technical but basically, you would have to hand implement the pixel and on every product page, you would manually trigger three mock product IDs that fire whenever that page gets loaded. And then with those product IDs, you drop those mock product IDs into your product feed and then you'd associate them... You load the associated images. If I'm gonna get a t-shirt, I have product ID for t-shirt, mock one, mock two, mock three.
21:42 SW: That's really interesting.
21:43 EH: The first one might be a lifestyle. Right?
21:46 SW: Yeah.
21:48 EH: The first one might be one lifestyle, I'm at the beach. The second one might be a second lifestyle, I'm out. It's a nightlife scene. The third one will be like I'm at the park with my dog. But, it all goes back to that relatability. If I'm in the middle of a purchase and I'm not sure, it's gotta feel relatable to me and what I aspire to or what I'm actually living.
22:19 SW: Wow, that's awesome. Just to recap, I actually never thought of it like that. Just creating one pixeled event for a specific product. If you're an e-commerce brand, you have, let's say, 10,000 SKUs. You're gonna go hand pixel two or three products. And then what you're gonna do is you're gonna then code into the product feed three different product IDs that you specifically wanna remark it to all the people who look at these three products. Correct?
22:52 EH: Right. The easier example would be if I have a facial product, if I have a cosmetic product and... Say, it's an acne product. It's a three-step product and so, I have the bundle. I have the bundle product. It fires off the product ID. It fires off three other mock product IDs. That might be step one and it might be attached to a photo that shows step one of the process, step two of the process, and then step three of the process.
23:26 SW: Wow. You're building like a remarketing funnel off all the people who just look at one specific product. Correct?
23:33 EH: Yup.
23:34 SW: That's interesting.
23:37 EH: It's something that's incredibly difficult to scale but if you have a product that is, if you have a limited number of SKUs, then that's just Friday afternoon with a lot of patience and a lot of brownies.[laughter]
23:57 SW: Yeah. There you go. This is not something you're doing if you have 5,000 SKUs. You're doing this if you're an e-commerce brand with say, 15 or 20 SKUs. What you're doing is you're trying to figure out if it's possible to scale something with a very personalized ad experience. You've seen this specific product. Now, I'm gonna fire you back a customized product feed based on what you've already viewed. Correct?
24:26 EH: Yeah. Correct, absolutely.
24:29 SW: The first brand that comes to mind that could use a strategy like that is Dollar Shave Club. The Dollar Shave Club doesn't have a ton of SKUs but they have a good amount of SKUs. They have their razor they have their... I really say that 'cause I just made a purchase off Dollar Shave Club. [chuckle] Literally, I just bought some razors.
24:49 EH: Yeah. Imagine you're Proactiv. And you're selling acne products and you're retargeting a 17-year-old with acne, and they then get to see the lifestyle, some before and after photos, something about how easy it is and then a bunch of other stuff. It becomes an immersive experience.
25:15 SW: Oh, totally and I think that's the future. I think the future of digital marketing, as Facebook gets more data, as all these other channels get more data is personalized in the ad experience, less around the demographics of user, "Okay, this is an 18, 19-year-old person." But the future of my creative digital marketing is personalizing the ad experience around the prior user behavior that user, how they specifically behave on your website. I don't think there's technology yet out there that I've seen that actually will, at scale, personalize the ad messages based around the prior user behavior on a website. Similar to what you're doing, Edwin, but doing it... Similar to what you just said you were doing, but that strategy but at massive scale. I think there needs to be some deep integrations. I don't know. That's what I think is the future and it's exciting, man, where the time is evolving at a rapid pace. And I think, augmented reality is another conversation which I'm excited to have with you, man, at some point but I think that's also the future. [chuckle]
26:24 EH: The augmented reality, we could show a data source in the background or playing basketball. Isn't that the Apple commercial?
26:29 SW: Yeah.[laughter]
26:32 SW: If you're interested in the lamp, you wanna see how that lamp looks in your bedroom. Can you imagine that lamp actually being put into your bedroom inside a dynamic product ad. Blow your mind.
26:48 EH: No, I hope that never happens because then my life is over. I would just buy so much.[laughter]
26:54 SW: I know. Can you imagine if every single one of your purchases that you make based around your lifestyle is already mapped into what you're using for the purpose of that purchase. If you're buying a shirt, it's already made for your body. Your Facebook knows the contours of your body. They're already putting that shirt on your body. You want a lamp, they're already putting that lamp in your bedroom with the light up. And I think that's where it's going. That's the future of marketing is, taking the use of a product and already augmenting that as a reality before you make the purchase.
27:38 EH: That would be amazing. That is the future, 100% that is the future.
27:44 SW: People are lot smarter than me who are gonna be working on that. [chuckle]
27:50 EH: A lot smarter than both of us.[laughter]
27:53 SW: No, man. You don't give yourself credit. You're a pretty smart dude, man. I appreciate you... Edwin, once again, I appreciate you taking some time to come on our podcast. Once again, Edwin Hermawan of Snappic. How do people get a hold of you? How do people download the app? Give a little spiel on how people get a hold of you, people who are listening to this podcast, or how they download the app.
28:20 EH: How they download the app, just go to www.snappic.io. That's S-N-A-P-P-I-C.I-O. You install the app. You just hit the "Try it out" button on the website. We give something very, very special that is not available to anybody else. We have a money back guarantee. What that means is that, every month we have a service fee. That's your monthly subscription fee. If the app doesn't pay for itself, then you send me an email and I will refund that service fee, no questions asked. We are the only company in the entire industry in all of advertising that even knows the word guarantee. And that's how much we believe in our product. That's how much we believe in DPA.[laughter]
29:15 SW: The magical technology of DPA. I love it. It's made a lot of people a lot of money and it's also made Facebook a lot of money and I think it's... Edwin, keep crushing it, man. Keep building new technology. Keep building out this ecosystem, man. I appreciate you coming on the podcast. Is there a way to get a hold of you, maybe for support or if people have questions?
29:38 EH: Absolutely. If you wanna get a hold of me, just go ahead email me. That's Edwin, E-D-W-I-N, @snappic.io. S-N-A-P-P-I-C.IO.
29:52 SW: Cool! Alright. Well, everyone, another episode on the books. Dynamic product ads, some holiday strategy. This was great, man. I learned a lot and thanks again for coming on the podcast. Stay tuned to the next podcast, and I will talk to everyone soon. Thank you.
30:12 EH: Thank you. See you, guys.[music]