Dennis (01:59):

You're listening to the rich add poor ed podcast, where we break down the financial principles that rich advertisers are deploying today to turn advertising into profit and get tons of traffic to their websites without killing their cash. These advertisers agencies, affiliates brands are responsible for managing over a billion dollars a year in ad spend. You'll hear about what's working for them today. They're rich ads and we'll roast their Epic failures and crappy ads on the internet with poor ads. Let's get into it.

Dennis (02:28):

All right. Y'all we're back in action. This fine Friday afternoon, with another episode of the rich and poor ed podcast. Now, today we have an awesome local Austin guests. I'm pretty pumped about it. I've been following has gone sweater for a while and it took me a while to get him on the podcast. But Hey, here he is. So we have Dennis Hexad the co-founder of live, recover the cart recovery powered by humans for e-com. So if you're into e-com and you need an abandoned cart recovery, this is the best podcast to listen to. So without further hype Dennis, what's good, man. Yo, what's going on? I appreciate you. Uh, letting me on here. Yeah,

Dennis (03:02):

Man. Thanks for coming on. I would say I had to kind of find, you know, track it down a little bit. It took a little while, but Hey, we made it

Dennis (03:08):

Not the best. Like I wish there was a way for them to resurface them or like an easy way to search. Cause I need like bookmarks, cause I have so many DMS and Twitter is LinkedIn for me and I'm not like active enough at managing it, but then I scroll back. I'm like, Oh wait, I want to do that. I need to talk. I want to talk to that guy or that girl or like we should connect anyway. Yeah. I'm glad that I'm glad that I followed up and I probably, I apologize.

Dennis (03:29):

No, you're good. Yeah. Yeah. It's Twitter messages suck. I posted that video of the Mac book with the crazy screens and that kind of blew up in my things flooded and it's gotten very hard to keep up with for sure, but sweet man. So give everybody an idea of kind of who you are that way people have some concerns.

Dennis (03:47):

Um, yeah, I mean, I'm, uh, I'm Austin local. I am a co-founder of the, of a text message marketing app for Shopify or it started out Shopify only, but now we do big commerce. Great joy. We'll commerce, Shopify, Magento. Um, yeah, large. My, I mean my main focus is obviously on SAS and, and I guess it's creating businesses, but I have a background in e-commerce and I've been doing that for, I guess since, since MySpace. So since 2007, uh, yeah, about 13 years,

Dennis (04:18):

You're the first one to bring a MySpace on the podcast and that right there and achievement itself, Tom, uh, the best friend of everybody. Yeah, that's cool. So how long has lab recovery been around for

Dennis (04:31):

Launch our beta? And I think created our LLC in July of 2018. And I think we had our first customer and our first dollar of revenue it's to say in August of 2018. So 30 months,

Dennis (04:44):

Hell yeah, man. That's quite some growth there and I did y'all start off just on Shopify then or did you, you know, how'd, y'all kind of, you know, frame that

Dennis (04:52):

In the beginning. Yeah. Starting out. We didn't necessarily like we, Shopify was the easiest place to start. Obviously it wasn't the only place to start there's WooCommerce and all these other ones, but Shopify had the best app ecosystem. And so for us, it kind of was like the most obvious place and it turned out to be, you know, the right bet to make. But now as we've grown, we've definitely tried to, you know, start diversifying off Shopify just to spread our reach. I guess that's exciting to me.

Dennis (05:18):

Heck yeah. Yeah. I know when it comes to developing these apps, it's gotta be a mess sometimes to let them speak to these platforms because it's, they're also different. I would imagine it's probably a mess on the engineering side, but then again, I'm not an engineer, so I'm not too sure there.

Dennis (05:31):

I would say I don't a hundred percent know because I'm not writing a code either, you know, shout out my CTO and our engineers because they're great. But um, you know, it did take us about, I would say about eight months to, we basically rebuilt our platform platform, one that's up kind of publicly just services Shopify. Now, if you go, it'll ask you what platform you want to use. Right. So we did have to rebuild everything, but you know, I think that's just part of staying, staying alive in the, in the space. If we just kind of focused on Shopify, there would be other competitors that might, you know, undercut us or whatever the case may be. So we always want to be one step ahead instead of chasing the person in front of us.

Dennis (06:10):

Yeah. And, and what kind of businesses work best for you platform as the kind of the bigger spenders and as somebody just kind of getting started out, what's your kind of sweet spot there? Um,

Dennis (06:19):

That's a great question. And I think it's, it's weird. Cause I think that like, if you talk about numbers and you say, Oh, like who's, who's getting who, who feels the impact the most. Right. If I said, Oh, one of our stores recovers $5 million a year, um, which is true, but that brand might be doing a hundred million a year. Yeah. $5 million added is a huge amount of money. But if you, but like, does that brand owner feel that the same way that someone who's making like, you know, $5,000 a month or, or even only a thousand dollars a month is, and then all of a sudden they use our app and they add, you know, $200 a month more, that's the difference between like maybe re-investing in an ad campaign or doubling down on a product or a brand or an idea because like you just, you know, you needed to see some return.

Dennis (07:05):

And so it's always expensive. I mean, Facebook is getting more and more expensive, right? So I think, you know, I think the smaller brands actually feel the impact the most, which is where, you know, what we want to do is help help brands and business owners recover more sales. Right. Um, but in terms of numbers, obviously bigger volume stores make the most money, but that, I think that'd be a question for the brand owners specifically, not so much myself, cause I'd rather help a small brand, you know, get started from a personal perspective. But if you're asking me who makes us the most money, then I obviously want the big brands, but like, do I want one or the other? I mean, I want both and all the ones in between

Dennis (07:42):

Love that. Yeah. So I mean, there's not really a one size fits all. And I think that's super nifty how you can impact smaller businesses to where it's a lot larger of a, wow, this is super legit versus somebody who's doing a hundred million and you know, gets five millions where it's 5%

Dennis (07:55):

Versus, you know, you get a Pat on the back for optimizing like changed the trajectory of their career or their business. Um, but I do think that they're like to, to, to hit on that. We do. I think customers that are enterprise scale that are, if you have a team of, of customer service agents or a customer experience team, that's full time and you have enough resources to, to manage SMS as a channel with your own texting, you know, your own team, then you probably outgrew us, right? We're not fit necessarily for enterprise. That's not to say that that might change in the future. But for now, since we're a managed service, meaning you download our app, you connect our, your store to our shop, uh, our app, right. And then our texting agents do the messaging on your behalf, but bigger brands that have, you know, enough resources might not need that help. And so, uh, that's something that we're figuring out,

Dennis (08:46):

Ooh, I'm pumped for this one, man. So while we got to know you a little bit more, we love to kind of dive into what's working really good for you at this kind of point in time. So what is your rich ad?

Dennis (08:56):

That is, um, the rich ad, I guess. And I mean, we've been running this ad for over a year and a half without much change, right? We, we take the same ad. We've changed some colors. We might like change some icons, a few things, but once you find a winner, it's very easy to make variations of that. Winter, that to Facebook are new and unique and also, um, slightly different so that you can, you know, if an ad obviously has decay and dies, if the there's a lot of negative comments or feedback, or just like over time, obviously you don't just see the same ad running for really long time. But our best ad this, I guess the rich ad is essentially just a conversation screenshot of us having a conversation. One of our texting agents with a customer and showing kind of how our product works in real time.

Dennis (09:49):

And then just calling out the people, you know, exactly who we, who we want to talk to. Obviously Facebook advertising policy is very sensitive, but so we say things like, you know, we know, we know that two of these things that these two things are true, your store is on Shopify and you want more sales. Well, like we're just saying that if those things are true to you, then you're probably going to resonate with the ad and you're probably going to click. And then if you see the image, it's got a Shopify icon and it's got, you know, a conversation and some dollar signs and like all of a sudden it's yeah, we've probably had 4,000 or 5,000 stores sign up from that single ad alone, man. Is it a static image or image? Yeah. I mean, I remember video used to be King, but this year, I mean the last like six months static images are just outperforming videos and flicking most accounts.

Dennis (10:39):

It seems like, yeah, we have one video that was a UGC. I really liked this ad and this would be my rich ad. If the other one wasn't still the winner, it'd be like the runner up. But Tik TOK format of which is like a specific type of like meme. It's like you take, I took a screenshot. It was actually a video of me scrolling my homepage, the landing page of live recovery.com. And then I had my face in front of it and I was talking about our, our business so that I don't know exactly what I said, but I said like, like, Hey, are you on Shopify? And you want more sales? Well, you should swipe up because without a credit card, you don't need a credit card to start and we'll give you $500 in recovered sales for free. And while you're listening to me talk, you're seeing the like value prop of the website scrolling behind me.

Dennis (11:25):

Uh, and that is a video ad, but it almost primes the customer to know what to expect on the landing page because you're actually showing them the website while they're watching you and listening to you talk, uh, obviously that ad format might not be able to work for everyone because it requires you to be a little bit comfortable on camera and maybe a little bit like impromptu in terms of what you're going to say. Like I didn't, you know, try to write something down to read off of a script. Like we're talking about a 15 second ad here, but ad costs me $0. Uh, and so do the other one, right? So I think we've spent $0 on creative for our ads in 30 months. Uh, and we've spent, you know, hundreds of thousands of dollars on, on paid ads on Facebook since we launched.

Dennis (12:09):

And when it comes to the return of these ads, are they pretty solid there? Is it, you know, what kind of metrics are you looking at? If you can share it's different for us, it's a little harder for us because we're, you know, we're a SAS business and we don't, we have a free trial. So like when someone signs up, of course we know certain things about them, we do something called lead scoring. So we want to know like, okay, depending on what plan you're on for Shopify, or depending on how many sales you've had in the last seven days, 30 days, or depending on your Quantcast score, or depending on all these data points, we measure the stores and we give them a lead score and we pass that information back that value back to Facebook. And so it's, it's never really like, we know exactly how much the ROI is going to be.

Dennis (12:52):

We just back into what's the cost per lead, what's the cost per completed registration. And then what's the cost per billing activation. Uh, those are the main metrics we look at. I mean, of course like smaller things like, you know, landing page, click through rate and click through rate and conversion rate from the homepage and Facebook to homepage and things like that. But, uh, for us, it's really, really the measurement, the high level of measurement really just cost per click cost per registration. Like how much does it cost to get someone in the door, not just the email, but signed up connected the app and basically ready to start their trial. How many people go from trial to actually paying you? Have you tried any different ways to try and, you know, boost that little conversion rate there, whereas that's pretty stagnant. Um, we, when we started out, we were actually, performance-based only, so we didn't have any monthly fees and that made it really hard to determine how much a potential customer might be worth, because if they weren't willing to pay our subscription fee of 49 a month or 99 a month, then it was like, we might just be in a big hole and we didn't know what someone was worth at the minimum.

Dennis (13:53):

But if I spend, let's say, let's say I spent a hundred dollars or let's just say I spent $200 to acquire you as a customer. And you, and I know you're going to activate the a hundred dollars a month plan. And the LTV data shows that you stay for 12 months. Well then obviously, like I just made a six X my time to break even as two months, which means I don't probably have to raise money or use any kind of external financing cause I can float two months. Uh, so it all, all those numbers just, you know, it depends on your, on your business and you know, what your LTV is and like, you know, average revenue per user per month and things like that. But for us, Facebook is profitable ish, but also just to be like, like top of mind and, and you know, like the market's huge. So I think for us, we, we've only scratched the surface. Uh, we have a couple thousand paying monthly customers and we want that to be in the tens of thousands of monthly paying customers. So we have a long way to go, man, I'm in this, to be honest, this is exciting. This episode is brought to you by a funnel Nash's ad card,

Dennis (14:52):

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Dennis (15:53):

That's pretty fricking 60 here. Now, while that is the rich out of the segment, I kind of want to hear about something that could have crashed and burned. So what is your poor app? I don't know if it was a specific app, like it wasn't a Facebook ad that's for sure. But we, and maybe this isn't the place to say it, but I don't have any other examples. So for us, the worst place that we've had a poor ad was on podcast ads, actually. Yeah, we tried, we tried sponsoring all these other podcasts that were like e-commerce and Shopify focused and, and SEO focused and this and that. And we spent, you know, it wasn't like it's sunk the business or her, it hurt us that, you know, like drastically, but, you know, we spent five to 10 grand and basically gotten zero installs. Uh, and so we were like, okay, I'm never gonna, I'm bitter about podcast ads.

Dennis (16:47):

I'm not reinvesting in that because I know with Facebook, but that's not possible because of the, you know, past traction and the current traction that we have. So yeah, I would say for me and us podcast ads have been a huge flop. We were expecting like, Oh, we can't wait for this podcast to drop. It's going to be flying in. We're like two clicks on the Bitly on UTM parameters, two visits to Google analytics. We're like two visits, no install, even one install on two visits. I would have been surprised at the 50% install rate or conversion rate. But yeah, in some of these podcasts placements, they aren't fricking cheap. So do they share with you the numbers out of curiosity, we don't even do this. I'm kind of like, do they gauge the average users per episode? They'll tell you, Hey, we get 3000 downloads per for, uh, you know, pers per episode. And that's great if you get 3000 downloads, but how many people actually listened to them and how many are downloaded automatically because of some app that you use that like queues up the recent ones that you're following. So like rate versus listening completion time is not the same. And we didn't get that may

Dennis (17:57):

And that's. Yeah. Cause it's like 20, 20 was the year of the podcast. For sure. So I'm kind of curious how people continue to monetize it

Dennis (18:03):

Actually possibly make these placements actually work. Cause I've,

Dennis (18:07):

I don't think I've ever bought anything from him, podcasts. I mean,

Dennis (18:09):

I just like to chill and not buy anything when I'm listening for the most part, you know? Yeah. I mean, that's, that's pretty much that's me too. I think the only time I can think of that I may have bought something or at least check it out was like a Tim Ferriss podcast back in the day or maybe like a Joe Rogan podcast, but for the most part, not, not for me. Yeah. Oh yeah. And

Dennis (18:32):

Now that you bring up Joe Rogan, I think I have actually bought

Dennis (18:35):

Some brains. Yeah. Yeah. I'm pretty sure it was like the friggin whatever brains, the alpha brain or whatever.

Dennis (18:45):

That's all right. I can't do it every day, but yeah,

Dennis (18:47):

It is what it is. Well, snap, that's quite a poor ad story podcast placement that didn't generate one install. Okay. That's, that's solid there. So for the final segment, we love to kind of dive in and kind of meet the crossroads of marketing and the financial side of things. So what's, you know, a good financial tip based off your experts, see, say kind of provide for the audience here. Um, I think depending on where you are in your life, like a lot of people want to make money and a lot of people also are like find themselves above opportunities sometimes, uh, mentally, right? Like I have some friends who don't, you know, aren't maybe in the best financial situation, but they also won't go do common jobs. And like, I'm not saying you need to go work at a store or go do something like basic, but like, there are so many creative ways to make money online or in person.

Dennis (19:39):

And I think that, like, I don't know. I just think that you shouldn't be above any opportunities. And so like even, you know, our businesses, uh, you know, seven figure a year profitable business, but I still think that my co-founder and it probably anybody on our team and myself are still doing side hustles and not full-time to the point of getting distracted, but it's like, I don't know. I think, uh, I'm not, I don't think anybody should be above doing any type of work. And so I think until you are where you are, like where you want to be financially, there should be no real excuse. Um, and so as a financial tip, I would just say like, there's so many creative ways to make money. And if you want to make money, obviously there are better things to focus on. Not just make money, right? Like money is a by-product of doing things with passion and doing them well and helping solve problems. But uh, making money is not that hard. Just don't be above an opportunity, I guess. Ooh, I love that

Dennis (20:34):

The co the, the year of the COVID is perfect for that everybody's out of work. They can find new things to do. You can find anything on fricking YouTube these days

Dennis (20:41):

Kind of at least get the basics down and then you can, you know, hire somebody to do some coaching there. So, I mean, I think people with limes, the scooters, like birds and limes, like in my neighborhood, they're, they're polluted and littered everywhere. And I use them sometimes and drive them. But I mean, you can make $5 per scooter to charge them overnight. And so yeah, they pay you five to $6 depending on where they are to charge them and to charge one overnight, you just plug it in and then it's charged. And so, like, there are people who have trucks that pick up like 50 of them and they make $250 every night overnight by charging the limes and the cost to charge them is like less than 10 to 15 cents per charge. So like, yeah, this means Lyme doesn't have to do any work, but like, if you said, Hey, would you go charge the limes for an extra $35 a day?

Dennis (21:33):

Most people would be like, no, are you kidding me? Why would I do that? And I'm like, well, $35 a day is a thousand dollars a month. And if another thousand or $12,000 a year is important to you, then why wouldn't you do it all the all that's just like dumb. That's the same kind of thing I'm talking about. Like, don't be above an opportunity. So I have, you know, it's like a mom, you don't have to do a lot of work. It's not something that's hard. You just have to go out and look for it. So imagine if you're doing that before, before you go to bed, you go can commit to finding 10 scooters in your neighborhood, right. They charge overnight and you have to drop them off in the morning. Okay. Maybe the place that you dropped them off his coat, like coincidentally really close to your coffee shop in the morning.

Dennis (22:09):

So now it's not out of your way. You're actually getting paid $50 every day to go get a cup of coffee. And you know what I mean? There's just a lot of ways to like make money. And I think a lot of people ignore that because they're waiting for something shiny and sexy, like to be a cool influencer or to have this happen or X, Y, Z happened. And it's like, that's not always the case. Things don't come to you, you go to them. So you bring it, you know, the super sexy, shiny things. And I know in this industry, I'm notorious of it, you know, shiny object syndrome. I don't know if this is something you deal with at all. It could not be, it could be, but how do you kind of, you know, stay aligned with what your actual goals are to kind of, you know, really not fall into the traps of shiny object syndrome where, you know, you're spending more time learning something versus, you know, fine tuning, a special craft.

Dennis (22:55):

Yeah. I mean, I'm, I've been dealing with that because I have add really, I, I get attracted to things and I like the beginning process of building and like actually building, I'm not, I wouldn't say generally I've been someone who's the best at scaling. And like, scaling might be different for everybody. For me, scaling is like at least $10 million a year, hopefully more. Right. So for me, I've always gotten to like, Oh, a couple million a year. And then it's like, Ooh, new idea, new project, new this. And then I'm like, wait, I have six projects going on. All I really need to do is one and go really deep on it. Because once you do that for long enough, and you're like focus on it and you're actually passionate about it, right. You're doing things for the right reasons, probably going to have success.

Dennis (23:38):

And after you've done that, then you can start going like wide instead of deep, because now you don't have to be involved with 15 projects. You could invest in 14 projects that you love while still going deep on the one that you are involved with in most. Right. So I've definitely been dealing with this since I was probably a kid. Now, now that I'm focused on live, recover as my main business. Yeah. I have like a small side hustle, but it's not something that distracts me from my business. It's still my core project. And there's nothing else. If someone said, what do you do? I would say, I run a business called live recover. I wouldn't even mention anything else. Um, but yeah, I mean, it's, you know, you, you're, you're, you're interest is compounded for sure. When you focus on one thing over time and then you look back and you're like, Oh, okay. That's why people focus on one thing. No one is the best at everything. If they said that they were, there were a lot of they're lying to you. Oh yeah. And I want to give a special shout out to my Adderall prescription for this podcast for this reason, you know?

Dennis (24:35):

Yeah. I know that's a real thing. And these, these times, but man, this has been an absolute blast. Give everybody an idea, you know, how can we support you? Any cool projects kind of coming up in the mix? Um, yeah. I mean, if you run an e-commerce business, whether it's on Shopify or maybe you use sticky IO, which I think was connected or connected CRM or woo commerce, Magento, Cratejoy you name it? Uh, if you want to recover cards over text message, you know, we'd love to chat with you otherwise, you know, if you ever want to just talk econ or paid media holler at me on Twitter, Dennis XF, there we go. You'll know how to, yes sir. Well, Dan is my man. We gotta link up an Austin CIN one of these days and get some barbecue or margarita there CAISO or something, man. Hell yeah. But once again, man, thanks for jumping on this. I absolutely loved it. Appreciate it. Yeah, it was, it was a blast. Sorry. It took so long and uh, hopefully yeah, hopefully barbecue and beer soon. Hell yeah. So yeah.

Dennis (25:38):

Thanks so much for listening to another episode of the rich ed or ed podcast. If you're like me and listen to podcasts on the go, go ahead and subscribe on Apple podcasts, Spotify, YouTube, and rich at [inaudible] dot com slash podcast. And if you absolutely love the show, go ahead and leave a review and a comment share with a friend. If you do take a copy screenshot of it, email me zach@funneldash.com. Show me you left a review and I'll give you a free copy of the rich add or add book to learn more about the book. Go to rich ed for a.com to leave a review that a rich ed or at.com/review. Thanks again.