- His First Business Was a Flop
- What’s Your Approach To Marketing?
- 2 Effective Marketing Approaches
- How Do You Plan on Growing Your Business?
- Content Marketing Strategy
- #1 Mistake To Avoid
- Learn It First, Do it Yourself, Then Hire
- What Are You Reading Right Now?
- The Science of Marketing
- SellerCon 2020
– Hey, everyone, Jason Katzenback here from Amazing. And today, I have a good friend of mine, Gary Nealon, who a few years ago was able to build a business from scratch up to a $40 million evaluation. And he did this all on his own, starting with content marketing. Now, Gary, I’d love you to tell us a little bit about your story but how you were able to grow that business and what you’re doing today.
His First Business Was a Flop
– Yeah. So actually, I gotta take a step back right before I built that business ’cause I think this is a pretty important story to share. My first business was a complete flop. I actually raised money and bought a business at the age of about 29. I ended up filing bankruptcy on that within the first year. So I wasn’t out of the box successful. That’s, I guess, is the point that I’m trying to get at. But right after that, I built the business that you just mentioned. We got it up to 40 million dollars a year in sales. And luckily, I was able to exit that about two years ago. And then I shifted into sort of helping other businesses and showing them the model that we used ’cause I realized it was a pretty unique system that we created. So I’ve been coaching other e-commerce businesses over the last two years. And then the last, I’d say, four or five months, I’ve actually been getting back into looking at a business to buy. So we’ve been doing a deep dive on probably about 40 different businesses over the last three months and just figuring out what’s the right one for us to kinda go out and get back into the e-commerce space.
– You just couldn’t retire, right? You had to keep going?
– Couldn’t retire.
– So, and just for clarity, the business that you had, that was an e-commerce business, correct?
– Yeah, so it was e-commerce. We did have a brick and mortar location, but it was really just for showroom and warehousing space. But 95% of our traffic and everything came from e-commerce.
What’s Your Approach To Marketing?
– All right, cool. So marketing was obviously a huge component of that because marketing is how you grew it. What is your approach to marketing?
– Yeah, so it’s been interesting, especially getting back into now. I think my approach has kind of changed. I’m moving into an industry that I didn’t know anything about, which is kind of how I started the other e-commerce business. But before I get into it, I’m actually doing a real deep dive on the industry, understanding who all the competitors are. What are the major resources in terms of educational components of that industry? Who are the major players in terms of blogs and influencers in that industry? Kinda compiling that, so that when I go to launch it, I have a really good understanding of who the customer is, who the competitors are, and where we can kind of fit into that space and create a brand around it.
2 Effective Marketing Approaches
– So, Gary, so do you look for a product that has good cash flow profit potential, ROI, and then look at the market or, and look at the audience and the content area? Or do you do it vice versa? How do you do that?
– So I’ll give you two approaches. The first one when I had the cabinet company that I had, I didn’t really do any market dive or anything else like that. It was a product that I thought I could sell. This time around, what I did was I really wanted to understand the market ’cause I wanted to look for something that had, that had a passionate audience, that had loyal following, or something that they wrapped their emotions around. So we went for the pet industry. Once I did that, I wasn’t really sure what type of product, so I started really doing a deep dive on what ones have recurring revenue streams, which ones have longer lifetime values and those types of things. And then narrowed that down to five or six different types of products that we wanted to target.
How Do You Plan on Growing Your Business?
– Cool, cool. How do you plan on growing this business?
– So essentially, we’re gonna do a combination. So the business that we’re buying is actually almost all Amazon-based. So my expertise is obviously off Amazon. And that was one of the other aspects that we were looking for is something that I could take my skillset and immediately plug it in and have an impact. So we’re gonna pull not all the traffic but pull some of the traffic off of Amazon onto our own site. We’re actually gonna create a content site around it. So it’s gonna be a separate blog and everything that just talks about the, so the topic’s gonna be senior pets. So it’s gonna be about aging dogs and those types of things. And we’re also gonna, I think one of the things I love doing is just testing other market streams. So we’re actually gonna go into some direct mail and do some other creative things just to see if we can drive traffic from other sources other than just online.
Content Marketing Strategy
– Now, obviously, you’re in a little bit of a different situation than some people. You probably have a little bit of a budget where you can test some things. But for someone that’s just starting out, let’s just say they just got their product online. What would you recommend from marketing strategy to get started from a content perspective?
– From a content perspective, I think the easiest thing to do, especially if you don’t have much of a budget, is look for, do a Google search and look for sites that are talking about maybe the… Let’s use the example of what we’re doing. So it’s, let’s say, a pet supplement. It might be, we look for blogs that say, here’s a review site or here’s a review of the top 10 pet supplements. So we immediately reach out to them and just say, hey, we’re new to the marketplace. We really wanna see if you’ll just at least review it or try it out. Give us your honest feedback. And if you like it, can you include us in the article? So trying to start where there’s low hanging fruit, where there’s already people looking at these types of reviews and see if we can kinda get some of our information into there. The other one would be to kind of do some of the research on it, figure out what questions are being asked around that particular product, and then just start creating content to answer those types of questions.
#1 Mistake To Avoid
– Awesome, awesome. All right, you’ve been in this game now a long time. You’ve probably learned a lot of mistakes. What would you say is the number one mistake that you wish you didn’t make, that if you could start over or as starting over, you wouldn’t do?
– Oh, man, well, in business in general, it would’ve been outsource sooner. I think and most entrepreneurs think they can do it all or that they need to know it all. We had our quickest scaling period when I stopped doing the things I wasn’t really good at and just outsourced them. So I’ll give you an example. So I used to run all the Facebook ads, all the Google ads, and everything else for the business. I became proficient at it, but by me outsourcing to somebody that’s specialized just in that particular field, they were able to drop our cost per acquisition. Our spend went up and everything else. So it was something that I would’ve never been able to do on my own simply because I didn’t have the bandwidth to be able to dedicate it to it like they did. So, I–
Learn It First, Do it Yourself, Then Hire
– You know, that brings up a great point though I wanna interject on ’cause I think it’s so important. But you did it first, and then you hired it out. Because I think a lot, and I wanna emphasize that point ’cause a lot of people, especially when it comes to paid advertising and stuff, if you expect to just be able to hire someone out and you have no clue how to do any of it or what the purpose of doing it, anything is, you’re probably running a huge risk. But by you doing first and kinda understanding what needs to be done, then at least you have some core expectations, so that when they come in, you know at least you have a baseline of where they can improve from. Would you agree with that?
– Yeah, so I think it allowed two things. One, it allowed me to do, I can look at what they were setting up, and I’d at least understand if it was set up properly or if it wasn’t. And then I could ask questions from there. But it also allowed me to understand the whole process. So I think one of the most important things as your business scales, and you’ll probably agree with this, is having processes in place, so that your systems don’t break. I think it’s a major thing with businesses. As you scale, add team members, and everything else like that, if you don’t have all that documented and systems in place, it’s gonna break. It’s just, it’s inevitable.
– Oh, yeah, it’s gonna.
– So if you don’t have a general understanding of it, you can’t actually map that out and say, okay, here’s the process I want followed. And then as they become more of an expert, they’ll tweak it and modify it. But that foundation is the key. So if you don’t have a little bit of knowledge in each little aspect of the business, it’s gonna break at some point.
– And I’m actually so glad that you said that was your big mistake ’cause I can admit that poor hiring, premature hiring has cost me hundreds and hundreds of thousands of dollars because as our business grew, all my businesses, I kinda was just excited. You almost think like, this is the thing to do. I find there’s two avenues here. Either people hang onto things too long, or they try to hire too quick. And the thing is there’s gotta be that balance, where it’s like, first of all, understand what you’re hiring for. Do the job. Write out the job description. Understand exactly what it is you’re hiring, so that you have an expectation ’cause when that person comes in, if they have no expectation and guideline, they might go down a complete path that you didn’t want in the first place and cost you a lot of money and really hurt you in the long run rather than help you. And on the other side of that, if you have someone that comes in, and they can really start telling you stuff that you don’t know if it’s right or not. So they can really just be lying to you and saying, oh, no, this is why I’m doing it this way. And you’re just sitting there like, oh, okay, I have to trust you, where that’s just bad business.
– I think you and I have very similar experiences ’cause I, I’m kinda the same way. I did the same thing. I hired too soon, or I didn’t pass it off quick enough. I think one of the things if you don’t take the time to learn a little bit about each of the different things is you don’t know how to measure their performance either. If you don’t have a benchmark of how long it should take to do x, then how are you gonna evaluate that employee’s performance? You’re basically setting them up to fail. Right, yup.
– And you just said on something, how do you know if it’s gonna fail? Let me, I wanna give one other piece of advice to those of you listening is plan for failure. Plan for success. So what I do, and I find this works very well, is come up with a three and six month plan of this is what success looks like. But this is also what failure looks like, and this is how we’re gonna deal with it ’cause the reality is you’re not gonna hire the perfect person right away. Chances are, you’re gonna go through a few people, and you’ll start filtering them out.I’ve done this too is you hang onto people too long. And the reality is if they’re not working out after three and six months, they’re not gonna work out. And you need to protect your bottom line and that means making sure that if they’re not working out, I think the analogy is hire slow, fire fast. And that’s not to be mean. It’s just you set up those expectations. When you hire the person, this is our expectation. This is what you’re gonna be doing. Here in three months, here in six months, this is what I expect, so that they know too as well. At the end of the six-month period, they’ll know pretty well whether or not they’re a right fit for it as well too so–
– Yeah, and one really quick tip that literally has saved me tens of thousands of dollars in probably the past two years. There’s a company called Predictive Index. It’s been a game changer for us in terms of hiring. And just quick synopsis of what they do, they essentially compare personality tests against millions of people in similar positions to tell you statistically whether that person would be a good fit because one of the, and this kind of a rabbit hole here. But one of the things that I’ve ran into when hiring people is that the sort of personality you get at the interview is not the personality you have three to four months later. So it’s really hard to look at a piece of paper and see somebody sitting in front of you and know whether they’re gonna work out three to six months down the road. Yeah, this actually is–
– You can spend so much money on hiring and trying to learn hiring. And the reality is there’s a small percentage of correlation between the interview and the person. And I’ll be honest. I actually spent quite a bit of money when I was young working with a psychiatrist to learn how be a good interviewee. It’s been an important thing. So I’ll give you a tip. If you’re looking at doing an interview for a job, one of the best things they told me, and I’ve got every job I’ve ever applied for back before I started a business, is react how the interviewer is reacting. So if they’re sitting there leaning on the chair, looking forward, when you talk to them, lean on the chair look forward and look right at them. If they’re casual and being casual talk, you sit back and be casual and answer them. Just a little tip, but that shows you too that that has nothing to do with how good I would’ve done in the job. That’s just all psychological stuff, so that’s great. It’s great, and, yeah, we could go down a long rabbit hole, I think.
– Oh, yeah.
What Are You Reading Right Now?
– Maybe we’ll do another interview just on mistakes of hiring. So let’s finish this off with one last question. What are you reading right now and why?
– So what I’m reading right now is actually a book called “Buy Then Build,” since I’m actually in that process. It’s sort of reinforcing all my theories on that whole concept of buying and building versus building and then trying to scale, fits my skillsets and all that kinda stuff. So it’s been fascinating to kinda read that and kind of basically reinforce everything that I’ve been thinking. In terms of books that I’ve probably read the most or repeatedly read has been “Predictably Irrational.” It’s one of my favorite books to understand the, back to psychology, the psychology of buying behaviors and how predictable it actually is that people are irrational. So, it’s a great book.
The Science of Marketing
– It’s always incredible when you dig into the psychology of things. And that’s one of the reasons I kinda geek out on marketing ’cause it really is science.
– You know?
– You’re collecting data, and you’re testing different things to get people to react in a certain way. And what I love as we mature, and the Internet has helped us so much with this ’cause we get so quick response, is that quality in conversation make up so much of it. Long gone are those days of just creating content and throwing it out there. Now it’s all about like, and that’s why social media’s so important. It’s about that engaging content that people interact with. But as you said before in another interview, it’s about answering questions. It’s not about talking to people. It’s about answering people and engaging with them. Would you agree with that?
– Yeah, I think the other caveat to that is that attention spans have gotten so much shorter because of social media and everything. They’re being inundated with information. So if you’re trying to cram information down their throat versus actually answering the things they really wanna know, you’re actually losing in the game. So, the impact of that was just if you’re answering the questions that people are actually looking for, you’re gonna retain their attention longer. And they’re gonna trust you more as an authority than they would somebody just spewing out a bunch of information.
– So if you come from the old SEO days where you would just look for a keyword and spout out information on that keyword, it’s time to change your game. It definitely is. I’ve got another interview I did with Gary, which we’re gonna be releasing very soon, where we actually dig into this a lot more, it’s all on how to write SEO content for websites. You’re gonna wanna look for that. And also, Gary’s gonna be speaking at this year’s SellerCon, sellercon.com, our big event for Amazon and e-commerce sellers. Gary was there last year. We loved him. His content was fantastic. And being able to have someone that grew a business from zero to $40 million a year on an e-commerce base, based on an awesome, I mean, I loved it. I geeked out on it big time when he shared it, on this incredible content network, where it’s all based on providing value with more or less, I say free. And I don’t wanna say free because really you still have to put your sweat and energy into it, but you’re not paying. You’re not paying for this one ad that you pay per click. You’re publishing this content that pays back over and over again over time, correct?
– Yeah, so if you wanna learn more about that, check us out at sellercon.com this year. It’s gonna be in Austin, Texas, in July. You’ll get to meet Gary plus 40 other top level experts selling on Amazon and Shopify and all those great e-commerce platforms. Gary, thanks so much for doing this interview. Is there any closing wisdom you’d love to share?
– No, the only thing I’d say is if you’re looking for other information or you just wanna read what comes out of my brain on a weekly basis, I produce a bunch of free content on my blog. So head over to just garynealon.com. Check that out. Just a whole bunch of free resources on everything that we’ve done in the business and all the little tips and tricks that use. So, you might go down a rabbit hole and spend hours on there, but a lotta good information on there.
– Cool, so check it out at garynealon.com. And, Gary, thanks again for being here. And you have a wonderful week.
– Yeah, thanks for having me.