Podcast

September 5, 2022

7

MINS READ

Squaretalk S2E2: How to grow an ecommerce brand with Orlando Rios

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In this episode, we are chatted with Orlando Rios, the founder of Raised by Coyotes, a southwestern outdoor apparel brand that has surpassed over 6,000 orders in just a year. Orlando is also a digital veteran of 10 years with his own marketing agency – Dropkick ads.

Across our conversation, we discuss how to market your brand, sales benchmarks, reinvesting, finding your own product niche, and much more. New founders will benefit greatly from some of the insights that Orlando has to share.

Shownotes

00:00 - Introduction

Orlando can boast owning a brand and knowing how to market it, as seen in the case of ‘Raised by Coyotes’. His prior notable experience includes being on the ‘Onnit’ digital team which was essentially a start-up and ended up growing into a fully-fledged brand with 200 employees and even gold sold to Unilever. 

02:33 - Biggest takeaways from ‘Onnit’

One of the biggest takeaways for Orlando was understanding what it is like to be on the client side. Specifically, he tried working with agencies, as a client of other agencies, and developed a list of things that were productive and unproductive, as well as established the type of connection with the customers that left the biggest impression and ultimately would decide success.

06:50 - Ecommerce, Retail D2C Expectations – Reality vs expectations

The marketing angle wasn’t the tough part, so the expectations and reality coincided. The truly difficult part was learning international business – communicating with suppliers overseas as well as figuring out specific production nuances and the process of making apparel.

09:30 - Niches – benefits and challenges

Orlando shares his experience of trying to establish his brand in a golf niche, but as fate would have it – the people flocked not necessarily for the usefulness of the products, but rather for the designs, contrary to prior planning. Thus, it was a very clear road to outwards expansion. However, he underlines that it is necessary to identify a niche and never try to pander to everyone. It is possible to grow to the point where expanding your audience is necessary, but in the beginning it is all about being a specialist in a specific category.

10:55 - Shaping the direction of a brand 

The best-case scenario is that you’ve done sufficient market research and poured hours into analyzing competition and where you’d fit. The type of designs that would potentially resonate and maybe even determined starting volumes. It’s all for naught if you’re not willing to part with that to some extent. Orlando talks about a founder’s responsibility to follow the customer.

12:04 - Tools for getting feedback 

There are many ways that may even differ from company to company. The most surefire way is to examine sales data and gauge what the customer’s needs and wants are. Reviews, be they positive or negative, are always a reliable source of data that will help mold the founder and their company. Paying attention to the customers and their interactions with the brand on any level.

14:57 - Relationship between poor and good product photography 

The big difference is in what you present. Product photography is like a book cover to your product or store. It’s essential to identify the style for maximum efficiency and resonance. For Orlando’s brand, flat lay has had substantially more success than models or ghost mannequins for reasons that are specific to their positioning.

17:35 - Sales of first release and first product

The first release for Orlando was a set of standard hats that came as a warm-up for the feature product being the polo. Impatience led to a hasty publication of ads and the first sale came soon after due to the absence of brand that occupied a niche of southwest style apparel. Once that niche was established – the biggest problem became learning how to project inventory. With that in mind, it still took months for the company to turn a profit. It took everything Orlando made to get more stuff and more inventory to continue growing and to eventually cross the profit threshold.

20:26 - Projections regarding breaking even or making profit

Realistically, there were no classical projections. It more closely resembled an inspection of daily, weekly and monthly checkpoints to gauge the direction of the company. The primary goal is to break even and make decisions with that goal in mind.

21:13 - Starting budget allocation and channels used for marketing 

Facebook ads are the bread and butter for Orlando. The starting budget would float around $10-20 a day without any special photography. The only saving grace were the designs that were quite specific in its target audience and location. The goal with every product and design is to develop something that would deeply resonate with the customer, and have them connect with it on some level.

25:46 - As a founder, do you feel attached to designs?

“You have to realize when something works and something doesn’t… this is a business and you can’t let your personal feelings dictate pretty much anything.” Technically it is true that anything can be sold if you market it the right but that’s a tough road with many hurdles and if you are a startup without much capital to throw around – you have to run with what works. Sure, you don’t want your designs to fail, but more than that, you don’t want your company to fail. 

26:47 - Dynamics between first sales and last sales

The dynamic seems to be pretty clear – anything gets better over time. It gets easier to identify the styles the customer likes and the ads they are most likely to react to. Orlando recommends to start with lower cart value. You learn what products like to get paired together, what the customer buying habits are like in your store and what might be inhibiting from buying more items. How to package and offer things to dictate or try to move the sales character of a customer to something that is a personal goal.

28:11 - Budgeting tactics for new releases

One of the most overlooked indicators is MER (marketing efficiency ratio) – you always dedicate a significant percentage of your revenue to acquiring new customers, be it through ads, photography, influencer campaigns etc. You need to be okay with saying “I’m willing to stick to a MER of 20%” so that you’re constantly pushing on the outskirts of your target audience.

30:48 - Retention and Lifetime value

Always try to increase LTV (Lifetime value). During his time in ‘Onnit’, Orlando understood the importance of LTV. It isn’t always directly applicable but in the world of supplements, stock has to be renewed quite often. If you are just starting, you won’t know the exactly value of LTV for a long while (approximately a year). 

“With time, you’ll understand customer buying habits and harness that to increase LTV, subsequently putting people on e-mail flows.” 

People are often too focused on trying to profit on a customer right away. If you truly want to grow, you cannot think like that in the beginning. The goal is to ask yourself “what is the worst CPA that I can possibly have and keep going” with the goal being an even cost per acquisition.

35:26 - New channels since you’re going into e-commerce?

Tik Tok and Amazon are some of the new channels Orlando is exploring currently. Every sales channel requires a different thought process and approach. What is important to note is that most people are not going to top out of their investment in Facebook and Instagram. Some people spend upwards of $50,000 on Meta product channels and may still not entirely get everything out of it. Facebook and Instagram take up the majority of Orlando’s budget due to them being extremely scalable.

40:10 - Influencer marketing for people in e-commerce and brand building

The biggest mistake one can make is falling for follower numbers. It is vital to identify who makes the best content, rather than who has the widest audience to peddle it to. One of the brighter examples of this is Dwayne Johnson’s kettle bell ad that got absolutely no sales.

42:50 - How much to put into lifestyle or regular photos

Orlando’s philosophy is simple – take as much content as you can get, do not take yourself too seriously and do not wait for the perfect content, just have it at the ready and improve on it step by step. Budget allocation differs vastly on the stage you’re at with the content you’re procuring.

45:00 - Don’ts of e-commerce marketing

There are so many no-go zones in e-commerce. Some of the more common malpractices Orlando underlines are attacking other brands or developing unhealthy rivalries. It is best to let your business speak for you and how customers regard you. The other one being giving up too early. You’re never going to get the results you want right away, so be ready to spend some money if you truly believe in your investment.

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