Podcast 15: How Emmanuel Eleyae Grew SatinLinedCaps.com to 7-Figures Off Influencer Marketing (A Million Dollar Case Study)

Drew:  Hey, everybody. Welcome to the Nerd Marketing podcast. We are talking today with Manny from Satin-Lined Caps and also from … Manny, what’s the name of your blog?

Manny: eCommerceStruggles.com.

Drew: eCommerceStruggles.com.

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Manny: It’s a mouthful.

Drew: How do you say your last name?

Manny: Eleyae.

Drew:  Eleyae, Eleyae. Despite the fact that I don’t know how to say his last name, I’ve known Manny for a couple years. He is one of the few experts on influencer marketing in the eCommerce world.

Manny: You’re too kind, sir. You are too kind.

Drew: I hope that’s what we’re going to get into today. Manny, we are doing a short series on companies that have experienced rapid growth, eCommerce companies that have experienced rapid growth; ideally, bootstrapped ones, too. Slaps was one that came to mind immediately so I thought I’d reach out and just ask you about how you grew that company. I say slaps but I’m abbreviating satin-lined caps, which is how they’re referred to, right?

Manny: Yes.

Drew: Welcome.

Manny: Thank you. Good to be here.

Drew: Maybe before we jump into this could you tell the audience listening now a little bit about who you are and your background?

Manny: Sure, I can do that. ’04 graduate of the Military Academy, so go army.

Drew: Hoo-ya

Manny: Finished that and went to … had to get that in here on your podcast, there, Drew.

Drew: Right.

Manny: Went into the army. Did a lot of logistics. Finished that, went into Amazon and did a lot of direct-to-consumer fulfillment. I learned a lot about managing a warehouse, managing lots and lots of SKUs, lots of inventory, inventory management, all that, and realized watching all the FBA vendors shipping their product in to us and we’d do all the shipping and stuff for them while they collected the check. I was like, “Wow, I’m on the wrong side of this thing. I need to get a product and start selling on FBA and shipping it in to Amazon to do the hard work for me.” At the time I was getting ready to leave and my sister came to me. She said she had an idea for a product. She had talked with quite a few people that really liked it. It was like, “All right. Let’s get started. Let’s try it out.” We started it out on Etsy and just going door-to-door and trying to get anything going. I still remember the days where we selling one a week and we’d have a goal of trying to get to five a week.

Drew:  Door-to-door?

Manny: Yeah. I even went door-to-door with it.

Drew:  That’s random strangers, or …

Manny: Yes, literally. Well, not random strangers. We would go to downtown and go to all the retail shops and try and get into retail salons or consignment shops or anything that was geared towards women anything. It was interesting because I would walk in with this hair care product for women and I was this man with no hair trying to say, “Hey, this is going to make your hair silky smooth. It’ll do this,” and it just wasn’t working out. They weren’t buying it. Yeah, that didn’t work.

Drew: How did your sister get the idea?

Manny: That’s an interesting story. You mind if we just let her speak to it? She’s here now.

Drew:  Sure, that’d be great.

Manny: Hey, Grace.

Drew: Hi, Grace.

Manny: Putting her on the spot. Grace is here.

Grace: Hi.

Manny: She just walked in so I figured I’d just throw her right in.

Drew:  Nice to meet you. Welcome to the podcast, I guess.

Grace: Thank you. What was the question?

Manny: How did you come up with the idea?

Drew: How you got the idea for satin-lined caps.

Grace: The basic short version of the story is that I have tried everything from do-rags, bonnets, scarves to sleep in and I didn’t like any of the options that were out there. At the end of 2013 I started thinking, “There has to be a way to combine what I do like,” which is beanies … I do like to wear beanies, but it breaks my hair off if I was to wear it too often. “There has to be a way to combine the satin that protects the hair with a beanie that actually looks cute.” Over the course of about six months the idea kept revolving in my mind and finally I was able to make a prototype and the rest is history.

Drew: It looks like something you’d wear not just when you sleep, right?

Grace: Exactly. That was the main thing. I want to be able to wear it to bed and then wake up in the morning and go run my errands without having to put in too much work to get my hair looking right.

Drew: Nice. The male equivalent is just a ball cap, I guess, where you just toss it on.

Grace: Exactly, exactly.

Drew:  Although I don’t know if you have men buying Slaps.

Manny: We do.

Grace: We do.

Drew: You do, okay. The male equivalent would be Slaps, also.

Manny: I wasn’t going to say it but, yes, the male equivalent is the Slap.

Drew: I guess this question … Do you want me to keep asking questions to both of you guys?

Manny: You can go with me. That’s fine. She popped in so I figured that it was a great opportunity to let you hear it straight from her instead of from me.

Grace: Nice to meet you.

Drew: Nice to meet you. Thanks for appearing on our podcast.

Grace: No problem.

Drew: Only on the Nerd Marketing podcast-

Manny: That’s how it goes.

Drew:  -do you get direct founder access like that. Okay, you’re going door-to-door. Your sister had an Etsy store, which wasn’t really getting much traction. How did you go from that to SatinLinedCaps.com?

Manny: Sure. One thing that going door-to-door did resonate with us deeply was the idea that we needed people who looked like our target demographic actually pitching the product. We reached out to 30 influencers on YouTube and basically asked them if they would be willing to take a product and do a video about it so then we could show someone who looks like them, to their audience, talking about the product.

Drew:  This is people with curly hair?

Manny: This is people with curly hair, ethnic hair, natural hair, who basically … yeah. Those types of hair. What was really interesting is we sent it out to 30 of them and only 3 replied and only 1 actually did a video and she didn’t have curly hair at all. She had wavy hair. That really went gangbusters. We sold, I think, 108 units in 1 day.

Drew:  Off that 1 influencer?

Manny: Off that 1 influencer. Then she did another video and I think we sold something like 200, but over the course of that 2 weeks we sold all 1,000 of our units.

Drew: This is before you had the website?

Manny:  We had the website at this point.

Drew: It was up, okay.

Manny: We were about 2 months into our journey, 4 or 5 weeks of struggling on Etsy, and then we’d had our website for about 3, 4 weeks running at this point.

Drew: How did you identify these influencers?

Manny: My sister, Angel, is big into the natural hair community so she had already known which ones to go after. She just went to the YouTube channel. We created an email, crafted an email, and sent it just to the people that she watches that were similar to us.

Drew: Okay. This was YouTube only?

Manny:  YouTube only at the time.

Drew:  Got it. Did you then pivot to Instagram or was it YouTube was working, “We’ll stick with YouTube”?

Manny: That’s exactly what happened. We stuck on YouTube. We took that lesson … That was, of course, the biggest live video we’ve ever had because it was just the product. But what we realized, it was 30 cents and only one did a video. That wasn’t really scalable, so I was able to talk with a mentor and find out about a company called FameBit.com where it’s a marketplace for influencers. We were able to use that to, basically over the course of 2015, get 72 videos done through FameBit, the FameBit VIP program. We continued reaching out to some folks but we scaled it up pretty quickly. That’s what we used almost predominantly for all of 2015, along with email.

Drew: Wow, so this is what really took you from 0 to 7 figures?

Manny:  Exactly.

Drew:  No paid acquisition on Facebook, no paid acquisition on Google, no SEO?

Manny: No. I feel bad because when we moved to Shopify they even make it really easy. They put it right there, “Add a meta description. Add title tags.” It wasn’t until a month ago where I actually went and did that.

Drew:  You’re like, “Eh.”

Manny: We didn’t do any SEO. We did pay but only to lose money. I don’t think we ever made any sales on paid and we spent 5, 10 grand over the course of that time. I’d listen to a podcast or something and thought, “Let me try that out,” and then it wouldn’t work for me. “Aw, man.”

Drew:  You guys invented the category, too, right? Satin-lined caps aren’t a thing.

Manny: Exactly.

Drew:  It wasn’t a thing before you made it a thing.

Manny: Yeah, no one is searching for that. It wasn’t happening.

Drew:  You hoped that you optimized for something like do-rag and the customer comes in and buys the satin-lined cap.

Manny: That would be the way to advertise for it.

Drew:  Yeah, you probably don’t get the kind of customer you want, then.

Manny: Exactly.

Drew:  With the social media or the influencer marketing, is that … I’m just blown away. The first ones you didn’t have to pay for, this one video that went viral?

Manny: Right.

Drew: At some point did these influencers [wisen 00:09:59] up and start asking for a cut?

Manny:  Actually right after that one we only actually went after influencers that want a cut because to me there’s a difference between the influencers who you give out free product. It’s very hard. It’s not as scalable. You have to hire people and you’re constantly emailing. It’s cold outreach. It’s really tough. We went after the ones that wanted to get paid because we can get their video in 30 days, negotiate a price, send them product, and in 30 days from start to finish we’d have a video done for us and I could have a campaign launched and get 10 videos a month completed at a fixed cost.

Drew:  So it’s a fixed cost per video?

Manny:  Yes.

Drew: So they don’t ask for a percentage of revenue?

Manny: No. What’s interesting is-

Drew:  Or affiliate links or something like that?

Manny: No. We even set up an affiliate program and we would offer it and they didn’t even want it. I found that interesting. It seems like the way to really growing is through sponsorship. The sponsorship, it’s one of the things, cold, hard cash up front seals the deal versus the promise of potential revenue and then the whole tracking: did it come from me? Did it come from you? Is the link going to work? That kind of stuff gets muddy.

Drew: The transaction all happens on FameBit?

Manny:  Yes.

Drew: It’s a pure marketplace where you basically can sort by influencer score and then they set the price, or you negotiate a price?

Manny: It’s actually even simpler than that. You just say, “Hey, I need someone to do a video for me,” and you put out how much of a budget you want to spend and they’ll reach out to you. You’ll get 30, 40 proposals coming back saying, “Hey, I’d be willing to do it for this price or that price.”

Drew: That is really cool. You specified the market you’re going after.

Manny: Exactly. I just finished one campaign for mommy bloggers and I got 9 of them who pitched us within a week. There’s another site called Reelio.com that also is similar and I’m finding that there’s pretty good quality influencers there as well.

Drew:  That is great. I’m totally dating myself but when I did an influencer marketing campaign in 2004 for my design business I just got mommy bloggers to blog on our site and gave them 30% off coupons or something. Those were the days when you had to go out, identify them, reach out to them, and negotiate it case-by-case.

Manny: Those were the good days, back then.

Drew: The good old days, man.

Manny: I can even give you numbers, how much I’m paying. What we try and keep them at for YouTube specifically is 0.005 cents per subscriber, so normally we’re paying anywhere from $500 to $2,000 for videos and we want influencers who have about 250,000 subscribers to about half a mill. That’s usually where we play now and see the most effect. The idea of just giving them a 30% off coupon code would be awesome. I’d love that. Times have changed.

Drew:  Why not go bigger than 500K subs?

Manny: I can give you my rationale. My breakdown for this is that if you’re getting the ones that are less than 100,000 subscribers, it’s a part-time job. They have a job and then they do this on the side. It’s not as professional. The quality, the script writing, is not as good. When you get up into the 250,000 to half a mill they’re just breaking into the point where it’s like, “My goodness, I can do this full-time? This is what I love to do. I’m quitting my job. I’m getting sponsorships.” They’re doing it full-time. When you get past the half a mill you’re getting into people who now have been doing this a while, they’re seasoned, and they have an agent or they’re being managed by someone, so you’re paying for not just their talent and the video but also their manager’s fee. We’ve worked with a couple that were 690,000, 700,000 but you’re paying 0.01 per subscriber or more, whereas with 250,000 you’re still getting the same quality but you’re paying half of what you would pay for someone with just a couple hundred thousand more subscribers.

Drew:  Right, right. That’s really cool. You measure the effectiveness of that ad spend … are you measuring it by how many people then come to your site and subscribe to the list, or by how many people buy?

Manny: We got a little fancy with it. Like I said, we spent a year doing this so I actually measure everything. I set up a trackable link that’s UTM tagged and then I do a URL redirect to mask it. I’ll give that to them and I incentivize the link click. To sum it up, when you watch a video that’s been sponsored by us you’ll see in the description box, “Click here to get 10% off your satin-lined cap,” and what that does is anyone that comes from that video, instead of them showing up in direct on Google Analytics, they show up in that campaign from that YouTuber’s video.

What I’m able to track, then, is when they show up on my landing page I have an event there that fires if they sign up and I know how many email sign-ups from that video. Then I also know what the bounce rate is from that video. I know what people did and I can trace it all back to that video. We’ve got 52 videos now where I could say, what was the cost per lead, the cost per acquisition, the ROI; how many orders came from that; how much revenue came from that video.

Drew: Yeah, it sounds like you just, essentially, built a little affiliate program, or at the affiliate programs I’ve worked with do just that. They redirect the links, tag them properly so they show up in GA, and you can use that to measure the return.

Manny: Yes, sir.

Drew: You’ve stayed only within YouTube. That was 2015 and it’s only a year later. You’re still staying within YouTube.

Manny: Yeah, we’ve actually moved off of it because what we’ve found is what you asked a second ago. We’re getting bigger and bigger, because now we’re making more. When we started this we were making $5,000 to $10,000 a month. Now we’re making $80,000 to $100,000 a month and we need bigger and bigger YouTubers. It’s just becoming more and more costly. Whereas before we were getting … a month after the video came out we’ve made an ROI of 4 or 5 times what we paid. Now it’s only 2 or 3 times what we paid a month after. It’s getting more expensive. I started moving into the paid acquisition space and that’s been my new thing this year since January, and getting beat up bad but the ROI … It’s tough. This is why I avoided it for so long but we had to find some ROI somewhere.

Drew: There, are you taking the content that has been produced for you and flipping it on to Facebook and turning them into ads?

Manny: Interestingly enough, that’s what we just had a meeting about this morning. The campaign that’s working the best for us right now is a Facebook ad where we essentially set up a picture of the YouTuber’s video. It’s just a picture. It’s an image. We push that ad out to a localized audience of our customers with an interest of that person’s audience. We push that ad to them. When they click through they go to a blog post, a piece of content, that is essentially that video. Then we had a newsletter subscription where they sign up for a newsletter and they go straight into a nurture sequence. That’s been performing 6 to 10x ROI really well for us. We’ve done that with about 3 different influencer videos that we’ve had done. I’m just going to keep doing that. I’ve got 50 more videos to go before I burn through it all.

Drew: That’s great. This is what I think we talked about at eCommerceFuel … You were just starting to do this … eCommerceFuel being a conference where I last saw Manny. I think with Facebook it’s contextual advertising. People aren’t on Facebook to buy. They don’t have their credit card out. The funnels that work there tend to be a little bit more sophisticated, where you drive people off the news feed to a piece of content and then you add them to a marketing pool or get them to opt in to a mailing list and then, ultimately, sell them through one of those mediums. That’s what works there. The advantage is you can do a lot of volume. The disadvantage is you have to put a lot more work into your funnels.

Manny: It’s worth it, though.

Drew: Yeah, compared to, say, AdWords, where people are ready to buy. They’re searching for something, a product, and you can drive them right to a product page.

Manny: Right.

Drew: You mentioned email as being your number 2 favorite channel behind influencer marketing. I imagine you’re using that more for retention but also what sounds like as a complement to these initial acquisition funnels.

Manny: Yeah, it’s been huge. The first 6 months of the business we were getting decent ROI with our influencer campaigns. We added in just the simple prospect sequence that you talked about. I went through your course. That increased our revenue by 44% in terms of what we were getting in, because now what we looked at was for people who show up to the site that don’t buy right away, how long until they buy? Normally it was 3 to 5 days, is about when they bought. I put a really aggressive nurture sequence where every single day I would send them a piece of content about us, a piece of content, then there was a deeper discount. First day was a welcome with a 10% off, and then by the 7th day there was a 15% off. The discount ladder you talk about quite often, that worked phenomenally. Not only did it work well, it was hands-off. We’re run that same funnel for over a year now. Haven’t had to tweak it, touch it, none of that. It just worked.

Drew: If some were to purchase this they obviously fall out of the sequence.

Manny: Exactly. At any one of those emails, since we’re using Klaviyo, we’re able to say, “Send this only to people who have not purchased in the last 3 days or 5 days or 7 days.”

Drew: I love it. The stuff I teach actually works.

Manny:  It worked gangbusters. It worked gangbusters. I loved it.

Drew: That’s good to hear. That’s great. Is that the story? Is that how you’re now at 7 figures, really, through these 2 channels?

Manny: I wish it was more complicated than that. Then I could be like, “Oh, we did all this and we tried that,” but, in essence, that’s it: influencer marketing and the email that worked. We tried other things because we wanted to get fancy. I had that exact same thought probably once a month the whole time this was going on for the last 18 months. It was just like, “We should be doing something else. Let’s try it.” We’ve tried PR. Had a PR guy for a while. We had a social media manager. Those things have not returned anywhere near as much as this funnel. The one thing I want to say about influencer marketing, too, that’s also really great is that it lives pretty much forever. We’re still making revenue off of videos that were done from that initial one where we sent her the free product. We still get orders from that pretty regularly.

Drew: That’s great. It seems, like you said, traditional PR, a lot of eCommerce sites discount that but for a product like that I would think traditional PR should work pretty well, I guess, depending on how much it costs.

Manny:  I’ll show you where it worked. What worked best for us was the trust symbols. We’ve had some [inaudible 00:21:53] come out and that drove some traffic and it drove some orders, which was nice. We were in the Huffington Post, I think Essence magazine. We were also on the Today show. A blogger brought us on to the Today show.

Drew:  You’re going to be on Nerd Marketing.

Manny: We’re on Nerd Marketing, exactly.

Drew: You’re going to be.

Manny: Now, what really helped out a lot recently, is we did a site redesign of our home page and we actually put those there and that’s helped out quite a bit.

Drew: Yeah, the new site is a lot more visual.

Manny: Yes, yes.

Drew: Did you see conversion rates go up with that redesign?

Manny: Not necessarily with the redesign, because we didn’t do it entirely … all the stuff didn’t come over, all the reviews. I had to reset up Yotpo and reconfigure. It wasn’t as big of a bump as we were hoping for, and it’s not quite done yet, but where I’ll tell you we got the biggest bump … Right now what we’re focused on is … Our marketing efforts are in site tweaks, so things like, should we turn on free shipping? We just finished a test with that and that increased our conversion rate 33% and didn’t impact average order value, so things like that. That’s been a huge bump. Then there’s a product up-sell app by Bold for Shopify. That helped us out another 17% in terms of … that was average order value increase of 17%, just by adding the up-sell, and increased our cart size.

Drew: That’s great. How about this web site chat, Rick Stephenson?

Manny: Yeah, Rick. That’s been an interesting one. HelpFlow, what it’s helped with is on the operational side of things, more so than the marketing, because we were getting swamped with people just asking things like, “Will it fit? What size is it? Do you offer free shipping?” which at the time was no, and they were easy answers, softball answers. We just kept getting swamped and we only did email customer service so reached out to the folks at HelpFlow and what they basically do is they create a knowledge base of questions you get asked regularly and they answer them for you. They have chat people available every business day, pretty much. That’s dramatically decreased the amount of inbound customer service emails we get.

Drew: That is incredible. Rick Stephenson … and for those who don’t know, I’m reading the name of the guy who is in the website chat right now … he doesn’t work for Satin Lined Caps. He works for HelpFlow.

Manny: Yes, that’s correct.

Drew:  Completely outsourced, that’s great.

Manny: That’s been an interesting one because we’ve been talking with John Tucker over there and it’s like, “Hey, man, our demographic, we may want to switch up old Rick.”

Drew:  Rick’s like an 80-year-old guy.

Manny: Rick is not quite the face you would expect.

Drew: “What the hell are these things?”

Manny: Yeah. He’s a nice guy, but we’re pitching to the ethnic hair care market and Rick pops up, like, “Hey!”

Drew:  “In my day you could buy one of these for 5 cents.”

Manny: Exactly. That’s another project on my list of things to do.

Drew: Got to replace Rick. That’s great. What would be one final takeaway? If people who are listening to this podcast are interested in growing their own eCommerce businesses like you have, ideally, within a year to a million in revenue, what’s a big takeaway, or what’s your biggest takeaway for them?

Manny: Sure, it dovetails on the question you asked on, is this all we did? Yes, it’s all we did. Pick the one thing that shows some type of ROI in your marketing and just hammer down on it, just keep going.

Drew: Just double down.

Manny: Just double down, double down, double down, because what it does is it makes life so much simpler. It focuses the team. It allows you to then start to automate or hire to that thing and you get to go do other stuff with your life.

Drew:  Yeah. People feel like they have to do every marketing program and they go to conferences and they write down every marketing tip but the reality is some are going to work so much better for you than others and it’s really going to simplify your life if you just become good at that one channel or attracting one kind of customer.

Manny: Yeah, and I didn’t give the number while we were talking but we’ve basically spent about $70,000 on influencer marketing and made about $700,000. Picking one thing did pretty well for us.

Drew: That’s amazing.

Manny: I’d encourage others to-

Drew:  That’s a blog post right there.

Manny: Actually, I happen to have that blog post. Thanks for the plug, the eCommerceStruggles.

Drew: I was going to plug it at the end but I’m going to plug it right now. Manny is now blogging at eCommerceStruggles.com and he has started talking about influencer marketing, but I think the idea is to branch out into his true love of operations, isn’t that the case?

Manny: Absolutely, fulfillment, shipping, customer service, accounting, HR, all those kinds of things, how to get those done right for eCommerce is where I’m moving towards.

Drew: That’s eCommerceStruggles.com. I’ll put a link in the show notes if you’re listening to this. I will also put a link to SatinLinedCaps.com and all the other apps and hacks and things that Manny has mentioned. Manny, it’s great having you on the podcast and congratulations on a success.

Manny:  Thank you so much. It’s been great to be here. I appreciate it.

Drew: Anything else you want to tell the audience?

Manny: I will say one more thing about the blog, if I may. The whole goal of it is to be just war stories from the trenches so even if you’re not interested in operations or any of that other kind of stuff I’ll have a lot of the blunders and gaffes and struggles we’ve gone through. The whole premise is, learn from our struggle so you don’t have to go through them yourself.

Drew: I like it. I like it.

Manny: It’s the whole thing. It’s all case studies and examples with hard numbers so that you can see how we did it.

Drew: There were these guys YouTube called Haulers, and you send them product and then they just open the product and they talk about it, like, “These are great sneakers. These are great t-shirts,” whatever. They’d open up our stuff and they’d talk about it but it never drove a lot of transactions. I’m wondering if it’s because we just … they’re doing it for free product so half of them would flake. That might have been it.

Manny: Not just that, you did the wrong type of video, too. Routine videos are much better. Instead of the, “Here’s my initial reaction,” that usually just is entertainment, but if you do the, “Here’s how it’s changed my life,” video, “Let me show you how it’ll change yours, too.” That first video, the reason why it went so well was the lady was basically saying, “Here’s how I go 4 days with the same hair, 4-day hair. It’s this cap, is what allows it to happen. Here’s how I keep- ” Another one is, “Here’s how I protect my curls. Let me show you,” or, “Get ready with me.” Those are the only videos I’ll pay money for right now. No favorites, no hauls, no nothing.

Drew:  Do you script them or do they script them?

Manny: We give them talking points and requests but we don’t get too directive, although on FameBit, if I’m getting a video there, I will reject it and have them go redo if necessary.

Drew: That’s good stuff. Yeah, like I said, the haul videos never really amounted to much. The kids would have a million followers. I was always curious why it wasn’t working.

Manny: It was just entertainment at that point. The audience couldn’t see themselves engaging with it the way the person was engaging with it because it was just, “All right, I opened it. Moving on to the next one.”

Drew: Yeah, they weren’t even putting it on.

Manny: See there? Exactly. We had that happen, I think, 2 or 3 times before we shut it all down. We were not going to do that anymore because you’d have a big audience and we were excited like, “It’s a big YouTuber and we got a good price,” because it’s just a haul and then it wouldn’t make nothing, even though they had a big audience and we had a great price so it would have been an easy ROI, just like, “Let’s just get 5 sales out of this and we get an ROI or we break even.” Nope, wouldn’t make it because people don’t really engage that much with those kind of videos.

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Drew: Wow. That sounds good.

Manny: Thanks, man.

Drew: All right. Thanks for being on here. This is the Nerd Marketing podcast. My name is Drew Sanocki and I will talk to you next week.