Growth & Greatness eCommerce Podcast
Growth & Greatness eCommerce Podcast
#2 - Apple's iOS14 ATT Update - The What, When and Actions You MUST Take Right Now w/ Dee Deng
In this episode we're diving deep with Right Hook Co-Founder & CEO, Dee Deng, into the upcoming industry-shifting changes that are coming with Apple's iOS14 ATT (App Tracking Transparency) rollout.
What is actually going to happen? Who is going to be impacted? How badly? What do you need to do right now to prepare? We'll cover all of that on this podcast.
To know more about the upcoming ATT prompt implementation, read Dee’s article here:
For more real-time updates, connect with Dee:
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Full episode transcript & chapter markers for this episode are available on the Growth & Greatness eCommerce Podcast Buzzsprout page!
0:00 - 0:27 - Episode Intro
This is the Growth & Greatness eCommerce Podcast, powered by Right Hook Digital, with your hosts Scott Seward & Raymond Johnston. If you’re an eCommerce brand founder, entrepreneur, or marketer looking to accelerate profitable growth for your business, then listen in ‘cause this is the podcast for you.
0:27 - 6:00 - Introduction of guest Right Hook Digital CEO & co-founder Dee Deng
Scott (0:27 - 0:38) - Welcome, episode 2 of the Growth & Greatness eCommerce podcast. We’ve made it back, Ray, and we have someone pretty special, we know quite well, with us.
Ray (0:38 - 0:45) - Very well. In fact, many of you may recognize this person as well, especially if pertaining to the episode we’re gonna talk about today.
Scott (0:49 - 0:52) - For our listeners, you can’t see the visual right now.
Dee (0:53 - 0:57) - Totally, exactly, especially for viewers only.
Scott (0:57 - 1:06) - You might recognize the voice. We got my co-founder and our CEO at Right Hook Digital, Mr. Dee Deng. Thank you for joining us, brother.
Dee (1:06 - 1:17) - Super awesome to be able to jump on Episode #2. Thanks for not making it Episode #1, but I’ll take 2!
Ray (1:17 - 1:43) - Now, I know we have a packed conversation today and I know that you wanna get into it, especially to help all of you out there listening to this. But I actually don’t think many people know Dee, your background, how you got started, especially since it’s really gonna pertain to why you’re so specialized to deal with this iOS14 topic. Won’t you dive in, tell people your background, especially HireHive, Video D Media, founder of both those companies.
Dee (1:45 - 5:39) - Yeah, for sure. So, sounds like we’re gonna spend all the time talking about the iOS14 impact and how we’re gonna respond and all that fun stuff. Essentially, I knew nothing about business circa any day before 2013 and then I found this one book that my buddy recommended me. I was sitting at a camera rental company, dusting off lenses and playing around with that type of stuff ‘cause that’s where I cut my teeth. My buddy was like, ‘Hey, have you heard of this 4-hour work week thing?’ I’m like, ‘Bull fucking shit, 4-hour work week, whatever!’ like there is no such thing. And then read that book and didn’t really prescribe to the 4-hour thing, but prescribed to a lot of, a lot of the other stuff really resonated with me and that started my whole journey on to Rich Dad, Poor Dad, E-Myth, the typical books that you would hit first, right? And then while I was there, my job at camera rentals was to rent cameras, self-explanatory, out to producers, cameramen, etc. Remember 2013, 2014, was when, like, the term ‘share economy’ was like fucking everywhere. Share economy this, you know, I still remember all those headlines like, ‘Can you believe it, you can live in a stranger’s home? Who would do that?,’ right? People were really tempted to go Airbnb. I was, essentially, every time we ran out of stock for rentals, I was just holding up two phones and putting them like this and being like, ‘Alright, well, there’s a guy with cameras and there’s a producer who needs it. We don’t have any stock. Alright, like you two just talk, I’ll hold the phones together.’ And I was doing that so much that I went, wait, there might be something here, why don’t I start a tech company? I know nothing about business, I know nothing about tech, let’s do that. And this was also when, I guess, tech startups here in Brisbane, Australia, where I live, it was starting to get some activity, right? Government grants were coming in, et cetera, so I found an incubator and I pitched them. I got into a cohort, massively funded, they threw us 20Gs, woo! Which evaporated immediately once you started to get all the compliance stuff that they needed you to get. You pay a lawyer, you pay an accountant, you pay someone else, and then it’s gone. But that’s also where I started learning about paid acquisition, growth hacking, digital marketing, et cetera, and started jumping into all the different forums. That’s also where, because I had a CTO that wasn’t really high on the T part, so I had to teach myself how to be the T part, right? Got myself to the point where I could angular.js, which is a different version, different type of JavaScript, and now that’s paying dividends here with the whole iOS piece and understanding Web architecture, how that works, or at least being able to cling on to the conversations without going, as much as I don’t understand to the nth degree, how all that stuff works. Now, that’s also where, you know, in the meantime, to stay alive, ‘cause HireHive drove me pretty much broke in the truest sense of the word. That’s also where I learned about salesmanship, how to get really crafty, and pretty much through cold calling generally 40Gs in two weeks of new business and found a way to float through that. When I took Neil Patel’s Internet marketing forum, and then found him over there, and then pretty much 80 people later now, we’re here.
Scott (5:40 - 5:42) - It’s crazy. That’s actually crazy.
Dee (5:41 - 5:42) - Was that long enough?
Scott (5:44 - 6:00) - And to think, between the three of us, the only way we know any of each other is through Facebook groups and communities. I mean, shit, we’ve been in business with Ray for, what, a year & a half before we even met in person. The Internet has done crazy things for business, it’s so interesting.
6:04 - 11:43 - What is the iOS14 ATT prompt?
Ray (6:04 - 6:56) - Which is the perfect segway ‘cause it’s getting ready to change again, Scott. For example, iOS14, I think, many people have heard the term, some of the people don’t really know what’s really gonna impact, and for those of you who now know Dee’s background, he’s been really specializing, if anything, leading the charge on iOS14 becoming, if anything, the thought leader in this space on the impacts it’s gonna have not only on eComm brands, agencies, really just Internet in general for the next couple years. So, for those of you who don’t know, iOS14, Apple’s forcing a change, a prompt. All users, from now on, have to opt-in for tracking for all apps on the iPhone App Store. With that being said, Dee, why don’t you kinda jump in? You’re the thought leader on this space. Can you give us some explanation? Like, iOS14, what are the implications, like, what have you found so far that’s gonna impact eComm brands and how are we gonna navigate this?
Dee (6:58 - 7:27) - For sure. I think, before that, the main caveat here being, I mean, you’re being super generous about this, but I don’t know if I would consider myself a thought leader as much as more recently, in the past… by the way, thank you, Apple, for dropping it on December, mid-December, and thank you, Facebook, for dropping it December 16, like worst Christmas present ever. Since then, up until now…
Scott (7:27 - 7:34) - While you were diving into this, I just went camping for the week and took a fucking break.
Dee (7:34 - 9:50) - Exactly. I was digitally camping on all, a whole bunch of different websites. Very luckily, most recently, got to talk to some machine learning experts as well. I don’t know if thought leader is the right term as opposed to almost like a self-appointed journalist. That type of investigative thinking to go, ‘Okay, well, who are the right people to talk to so I can gather all the information, report it accordingly?’ I’ve used Twitter to report on this, or Twitter in general, more in the past 3 weeks than I have in my entire subscription of being a Twitter user. I’ve been a Twitter user since 2014 or something like that. Essentially, I think the first thing to disambiguate, iOS14 is a really easy headline, but more specifically, it is ATT within iOS14. I’ve been in a few Clubhouse rooms where people are like, ‘What do you mean? We’re already in iOS14.’ Yes, but iOS14.x, and very likely gonna be 14.4, keeping in mind that we are already in 14.3, and beta for 14.4 is getting deployed, is already deployed. Essentially, it’s an ATT prompt, people are gonna have to opt-in, and the main piece on Apple’s side is called PCM, Private Click Measurement. If you go to Webkit and read, by the way, this isn’t new information. Apple’s been talking about this, especially on the Safari side, for, like, years now. I think the article on Webkit dates back to 2018, if not 2017, and it’s all about restricting, aggregating, and delaying data and also restricting, overall, restricting the ability for anyone on the Internet to track the user down to this action was taken x milliseconds ago, spent this much money, and then be able to follow that person around, right? Which is a very, it makes sense, for that type of move with Apple, to say, ‘Our hardware keeps all these big evils away so come love our hardware and that’s what we stand for as a company.’
Ray (9:54 - 10:03) - Are you saying that this has been, not only in the works for a while, but would you go as far to say that Facebook knew this was coming way before they let other users know about it?
Dee (10:03 - 11:42) - I would say that Facebook has been working on it with a certain timeline in mind. It’s not like Facebook has been obscuring information or anything of that nature, but, you know, understanding… I mean, look at Facebook in the past few years. Their entire mandate they were marching towards, what they were marching towards was may every man, woman, and child on this great planet be able to click two buttons and spend money on Facebook advertising. Power of five, oversimplification, algorithm, upload your creative - may every man, woman, and child spend a dollar on Facebook ‘cause that’s the golden standard, right? If you have an advertising platform that can be so simple and drive your business results, or drive your personal brand results, or turn you into an influencer, like, I forget what Pixar movie it was, Chessmate, right? You’re there. Then Apple just went, I’mma pull the handbrakes. So they accelerated the timeline of the inevitable. So it’s a bit like climate change. You’ve got all these people saying, ‘Oh, you know, it’ll only hit when I die.’ or it’s 30-50 something years away and Jehovah, “Apple Cook,” says ‘you know what, I’mma accelerate that. Let’s make sea levels rise tomorrow.’ And then everyone starts to escalate, all the recycling and that stuff. I can’t work on that stuff anymore. I need to move to a completely different plan. This is exactly what’s happening right now.
11:43 - 18:31 - How serious is the iOS14 ATT prompt situation?
Scott (11:43 - 12:20) - So, how serious is this? We can elaborate on how this has impacted our approach internally and what we’ve been doing, the amount of time and thought we’ve been putting into this collectively, even to the point, I wouldn’t say pivot, but it’s definitely changed what 2021 looks like in terms of where our focus has been, services, what we’re doing strategically. How much of an impact and how important is this? You know, for the people that are in a state of blissful ignorance, and I still think that there’s a lot of people out there, what should they be doing and how serious should they be taking this?
Dee (12:22 - 12:33) - First of all, God bless you, ignorance really is bliss. All the stuff on here used to be long hair as well, but now it’s slowly coming up this way. Soon, it’s just gonna be one line…
Scott (12:33 - 12:35) - At least, you don’t have this color coming through, you’re good!
Dee (12:35 - 15:12) - You’re right. Totally, totally. I think we need to answer that in two pieces of context, right? At an industry level and at a what-we’ve-been-doing level, because we’ve been kinda lucky. Shit, because of COVID last year, we started, that really challenged our thinking and got us to start putting down groundwork around, you know, what can we be the best in the world at? What services do we need to be rendering now and into the future? What do we need to start putting in place, almost like yesterday, last year? Now, very luckily, we’ve already started making moves so thank God for that. Then, from a seriousness standpoint, for the blissfully ignorant, it’s as serious as climate change depending on where you live. Here’s what I mean. If you live in a cozy part of New Zealand where, you know, it might get colder or warmer in the summertime or wintertime, it’s not kinda serious. If you happen to live in rural Australia circa end of year 2019, it’s fucking serious, that type of magnitude. Regardless, it’s coming, depending on where you live, it’s coming. If you’re all in Facebook, and only Facebook, and you’ve been disregarding email, Messenger, any of that stuff, besides the typical put a pop-up, $10 off any new users, and then you email them once and that’s it, you likely live in rural Australia where, you know, the shrubbery is really, really dry. If you have already been thinking about respecting how important creative is, having some type of data collection besides just in-platform type stuff, and you have an MER-type thinking, you’re so much more protected, right? You live more in the New Zealand side of things where you’re not living by the beach where the sea can just wash your house away, you’re not living far away from water, that type of stuff. That’s the closest analogy I can give. But it’s serious enough for us to, I mean, shit, look at us for the past 2-3 weeks and all the work we’ve had to put in just to, one, wrap our heads around it, technically, and then understand the second & third-order consequences that may come out of it and play chess board to go, ‘Well, in this scenario, what does that look like?’ et cetera. But for those who are heavily reliant on that Shopify-Facebook only kind of pairing, I think for those folks, hella serious.
Scott (15:12 - 16:19) - I think, coming back to the COVID thing last year, you’re right. It was, there were so many unknowns, we don’t know what’s gonna happen, it was just a plan for the worst, hope for the best situation. I think it’s taking that approach here as well. For the brands that are reliant for front-end profit, can they sustain a 30% deterioration in performance? Is their business sustainable, or do they need to shift their focus and look at other channels? Focus more… how are you gonna offset that loss of performance on the front-end and make up for it post-click, optimizing, landing pages, retention, email, SMS, building communities, building groups, assets you own? There’s just gotta have to be such a massive strategic shift from, I think, the companies that are like in the middle of the pack and the smaller scale that don’t already have those assets. Some of the bigger brands, they’ve got big lists, they’re gonna be able to have, they’ve got big, organic followings. They probably got a bit more flexibility in what they can do and how they’re gonna be impacted, but especially for the smaller players, I see, worst case, it could get very ugly.
Dee (16:19 - 16:22) - Absolutely, right?
Ray (16:20 - 16:49) - I think, and Dee kinda hit up on this, it’s not all doom and gloom, but it really is, if anything, it’s heightening what you should have been doing all along. Building the back-end, building the community, all the people who focused on building the brand and the community and building something that’s more than just, excuse me, dropshipping. If anything, all those pieces have been overlooked for so long, it becomes more important. It’s not things that are new, but you should have been doing it all along to build a standout, world-class brand.
Dee (16:52 - 18:31) - For sure or, at least, the very bare minimum, applying a different type of thinking as opposed to product-centric, first-touch impulse, very low margins, slam prospecting like crazy-type of setup, right? Naturally, that implies the fact that it’s drop-shipped and lower quality, et cetera. It’s not as if, it’s not to say that if you don’t have a world-class brand, it’s gonna all fall to shit, that’s absolutely not where we’re going with this. If you don’t have that type of metric, the MER kind of thing to go, I have this media mix that I have to leverage and I have to my ability, I can balance my books accordingly. That way, I understand that there is a repeat purchase factor to how I interact with my customers and how my customers interact with me that alleviates pressure to keep prospecting like crazy all the time and be like hyper-profitable on that first absolute touch because my product just isn’t that type of product or my brand isn’t that type of brand. Then you have a really well-rounded out type of thinking to navigate the upcoming waters. It’s like having a ship that’s a bit more robust going into choppy waters than your dinky little thing that you blew with your mouth and inflated and now you’re just up shit creek with half an ore.
18:33 - 25:14 - What are the current changes happening now and what shifts have to be made? - Use of Marketing Efficiency Ratio
Scott (18:33 - 19:20) - I think it’s so important, as you said, you were referring to MER, so marketing efficiency ratio, and looking at a higher level now because, especially for a brand that might have a higher average order value or a longer buying cycle, trying to make decisions based off of what Facebook’s telling you in-platform now is going to be, you’re just gonna get lost in the trees trying to figure out, is this performing or is this not performing? So, I guess to segway a little bit there, and move things along, where are we at right now and what has happened? We’re recording this, 22nd of January in Australia, 21st in the US. Some changes have happened in the last 48 hours. What’s happened there and what shifts are gonna have to be made immediately in terms of how we’re looking at metrics and making decisions?
Dee (19:21 - 19:24) - Ray, I know you got feelings about that.
Ray (19:24 - 20:41) - Yeah, so, we mentioned MER, so that’s the marketing efficiency ratio. You can go by different terms. If you’ve ever done Amazon advertising, ACoS is another one. But, essentially, it’s total sales divided by total advertising costs and into ratio. For a lot of you guys, you’re probably used to focusing on one platform, the ROAS of that platform, or the revenue of that platform. But because of the implications that Dee mentioned, that’s ATT right, Dee? That’s bringing to advertising… It means that you’re not always gonna have the most reliant data ‘cause Facebook’s gonna start aggregating the data so that data’s not gonna be instantaneous. What that means is, as a business, you have to be able to zoom out and then zoom in. Zoom out, look at the total MER, how is my total profitability or total revenue in relation to advertising costs. And then, zoom in, just use that platform’s ROAS to help make decisions. For example, internally, we actually had a statistics test that proved that MER is actually a more efficient and highly correlated metric to use that actually makes up the change in actual Shopify sales than Facebook revenue or Facebook ROAS. So that’s kinda worth thinking about, how we’re looking at it, ‘cause now it’s not gonna be so black and white anymore.
Dee (20:45 - 21:26) - Yeah, for sure. As a business owner as well, or as like a high-level head of marketing, VP of marketing, CMO-type thing, you wanna be able to get back to making business decisions at the higher level as opposed to staring at the platform and fritzing out because you’re hitting refresh every 15, 30, 45 minutes. In a way, this is training people to get their head straight too, to go, and you know Jim Collins would be so proud of you, Ray, to be able to zoom out and zoom in accordingly, and then make decisions at the business level, and then let the tacticians do what they need to do at the tactical level, right, at the platform.
Ray (21:27 - 21:46) - We’ve been kinda dancing around solutions. I think we understand MER, how we’re gonna make decisions, but Dee, you’ve really had your head deep in this. Where do you think longer term, 6 months to a year, where do you think right now, in the current state, the solutions are gonna be for reporting or attribution, if that’s possible?
Dee (21:47 - 25:14) - Yeah, for sure. You know, for anyone who watched the webinar, you already, kinda got the key headliner points, right, where AEM effects, anything that sits on the AEM umbrella or the whole topic of opted-out individuals comes down to the restriction of data, aggregation, and delaying of that data, and it impacts optimization, tracking, measurement from a reporting, visualization, looking at numbers standpoint and then reporting from an attribution and attributing a sale type standpoint. And then you have all your event restrictions, with the 8 you’re stuck with, and for all the opted-out users with the 1 that’s cascaded down, based on the stack rank. If you look at all the Facebook docs so far, and you listen between the lines with all of the, in and amongst the ‘we didn’t agree with Apple! We don’t agree with Apple!’ for 15 minutes, once you hear past all of that, and you actually listen to what’s being said, and I went so far to like put into my ROM what was being said outside of what’s on the deck, they’re hanging a lot of hopes on CAPI, conversions API. They’re putting a lot of emphasis there, putting a lot of emphasis on offline conversions as well. What does that point me to? The only way you can talk to, as a site owner, you can talk to CAPI, is pretty much on the server side, which maps really nicely to what everyone’s talking about with third-party cookies starting to crumble away and privacy sandbox in Google’s side, Chrome deprecating third-party cookies by 2022, and all that stuff happening. I actually got to be in a Clubhouse room with a Googler, internal, I forget which department she works in, but she was like, ‘Yeah, we got more information coming out of the Privacy Sandbox side.’ Like I said, it’s not going away, this climate change thing is not going away, it’s coming, right? Essentially, first-party, check. CAPI, yes. And then what’s the conventional wisdom that’s getting slung around right now? Easiest thing to do is go into Shopify and just natively integrate your CAPI with Shopify. The issue there is, that native integration only parses through purchase events. In other words, initiate checkout, add-to-cart, product view, no! Email signup, that doesn’t get parsed through with that native integration. So where my head’s been going, what I’ve been trying to understand is, and it goes a lot deeper and I’m trying to fight off and resist getting too technical with the other restrictions, but there are a ton more. Essentially, the alternative to the native integration, at the end of the day, what you need is to move towards first-party data ownership and data management. Now, this is a brand-new world for a lot of players because, now, you’re starting to get into the world of consent management, data warehousing, of owning data which opens up a whole bunch of legal vulnerabilities that you didn’t have to shore up against and shore up, be protected against as well.
25:15 - 27:58 - What are first-party cookies?
Ray (25:15 - 25:22) - Dee, can you explain first-party cookies in a ninth-grader’s point-of-view? How would you explain that?
Dee (25:22 - 27:21) - Yeah, let’s pass the explain thing. Let’s explain this to grandma and help her understand. Let’s make sure it passes the grandma test. My website is my office, right here, and I’ve got two vending machines; one vending machine on the side says Coca-Cola, right, and my team members can go in there, pop some coins in, and they can get a drink. Now, that money, the data, doesn’t come to me, it goes to Coca-Cola even though it lives in my office, in this situation. That’s a third-party cookie. In other words, someone that works at Facebook, who I don’t employ, stands there in the corner of my office and every time I do something, ‘hey, Facebook, they did something.’ But I still get to go back to Facebook and be like, ‘Hey, what did that guy tell you? Let me use that data.’ But now, Apple is saying, for opted-out users, it’s like, ‘I’m giving you an eyepatch, you can only see half the shit now, right? And it’s there.’ Meanwhile, if I install Bob the server, right, and he stands next to Mr. Facebook, Mr. Google, Ms. Analytics, and he goes, hey every time a Facebook person says something, I wanna listen, I’m gonna write it down, I’m gonna give it to Dee on his desk.’ Now, I have that stuff and it’s mine, right, that gets transcribed over, first-party me. Now, I can be like, ‘Yo, Scott, I just got this report, here you go. Yo, Ray, leadership meeting, here you go. By the way, this is ours, no NDA, no nothing, it’s ours to use however we want.’ That’s third-party, that’s first-party.
Ray (27:21 - 27:24) - Wow, it gives you way more control if you can do the set-up.
Dee (27:24 - 27:58) - But gives you way more vulnerability but you now have to tell… there’s a technical, legal, and ethical component to data ownership. GDPR, CCPA, all these pieces, and then there’s an ethical piece around ‘cause there’s a lot of greys in this area. With any new area, there’s a lot of greys. So how you manage the consent management piece is gonna come into play as well here, or not manage but then enter at your own risk kind of situation. Hopefully…
27:58 - 39:54 - What are the legal ramifications at play here & what changes will the attribution window undergo?
Scott (27:58 - 28:09) - Which is probably another area that gets more regulated as we get down to track, right? Once this becomes a solution, they’re gonna start enforcing that so do you wanna be prepared ahead of time and do it properly to start with?
Dee (28:09 - 31:03) - But here’s the catch. This is why there’s a legal component to this. Here’s the catch - Apple is not a governmental body. They are a commercial organization imposing this on other commercial organizations. So who really polices this, in this world of us talking to Facebook, first party, et cetera. Very, very grey. So that’s what I was trying to say before around the first part of the piece, and then that’s why Facebook, and this brings us all the way around, why Facebook is going conversions API, guys! Offline conversions API, guys! Add insights API, guys, because there you have something that is a pass-through that Facebook can say, ‘Yo, the website owner owns that data, first-party for them, none of this Pixel type stuff.’ What can we do with this stuff, right? So that’s why I’ve been head down so much on that side. Now, there are a whole bunch of benefits to server-to-server as a custom implementation. As an example, if you don’t want to have a delayed aggregated and all that type of reporting, you can still be able to, server-to-server, back into the cleaner, pull it up, and have that information from Bob’s server, come to me in milliseconds, and go up on the dashboard internally through APIs in milliseconds, right? Because from the ad click, to the website, that transaction, to my understanding, isn’t getting hindered. It’s the parse back through to all the different destinations that gets hindered, and that’s where it gets aggregated, restricted, and delayed. But between ad-click and website, that transaction, you can still vacuum cleaner up whatever you need and then look at it within that time and make decisions accordingly. Now, that comes down to whether you use third-party tools, build internal custom tools, whatever that may look like to data visualize and make decisions, but you have that piece. The other piece is cookies as well so even if you have a first-party cookie, and you can go to cookiestatus.com to see this, even if you have a first-party cookie, if it’s a C name-cloaked cookie, cross-site origin, then it’s still expires in 7 days. However, if it’s mapped to, if the website is dees-dresses.com, and the subdomain where the server-side container lives is analytics.dees-dresses.com, that is not cross-site origin, that is same-site origin, and so you can start to have a bit of maneuverability with cookie expiry, which is super cool to know and wrap my head around and understand. For those who are listening, this is plain gobbledygook, nonsense, I don’t understand what’s happening right now, remember WCA 180 days, right? Remember that? WCA 180 days, that’s because you can WCA 180 days because that is the extended length of that cookie. Now it’s more like WCA 7 days, right, unless you have these certain types of implementations.
Scott (31:30 - 32:02) - Which is what happened, what, 2 days ago now? Within Facebook, they shifted from default attribution window of 28-day one-day click to 7-day. What impact does that have, it’s caused headaches from a reporting standpoint for us and for clients. And, Ray, you’re probably in a good position to answer this, what have we been doing to try and work around that and shift our expectations in terms of what’s being reported in Facebook and the impact from that attribution change?
Ray (32:02 - 33:44) - Yeah, so, for all you eComm brands, if you haven’t already, it’s gonna be a little tricky but you need to go back and look historically, what has been your attribution. You can find attribution by going to your Facebook Ads platform, go to columns, go to attribution at the bottom, you can see the different 28-day, 7-day, and 1-day click, and the view attributions. What we’ve been doing is, for every ecomm brand, first we identify what has been the historical 28-day click attribution. And then, because we knew 7-day click was happening before first, then what’s the 7-day click attribution, what’s that percentage change? Because what that means is, if you’re running advertising on any platform, regardless of Facebook or whatever that is, you need to know what that relationship is because it’s gonna change not only what KPI’s realistic now because you have less data that’s taking credit in the ads, but then also what that means is well, is you have to shift how you think about how much you spend, how much you acquire customer for example, so that’s where, this heavily ties into MER, Scott, which you should take that in a second is once you understand what that attribution difference is, then you probably have a more realistic expectation benchmark that you can live off of going forward. Also, there’s the unknowns, which, there’s a lot of misinformation out there as well, but big unknowns like what’s gonna happen when people start opting-out, but you need that benchmark, so for all our brands, we had to get that benchmark first. But then, still, that doesn’t fix how you scale, then you have to start focusing on MER, which is what we’ve been preaching and really looking into and honestly, we’ve been shifting this way for a few months already.
Scott (33:44 - 34:50) - The flow here in here is the second part of what is gonna happen, the performance side, and this is where the unknowns start coming in alright because we don’t know what the impact is gonna be on the performance. One thing to look at, 7-day versus 28-day, and say, okay we can expect a 15% reduction in attribution within Facebook. We can allow for that and then we can zoom out and just reset our expectations around our performance within the platform. But what’s coming down the road is just, we don’t know. We don’t know how many people are going to not opt-in to being tracked which, let’s just say hypothetically, that could be as high as 75% - 80%. That’s 75-80% less data getting fed back to Facebook. What impact is that gonna have on Facebook? How well is their statistical modeling gonna work? What is the deterioration in performance from Facebook’s algorithm gonna do and impact performance overall? This is where it starts getting into the unknown area of what the future of Facebook’s gonna look like for the next 6-12 months.
Dee (34:50 - 35:09) - And I think here’s the part to disambiguate as well. When Scott says we, he means we as the human fucking race, does not know. Nobody knows, not Scott, Ray, and Dee and anyone in Right Hook doesn’t know, nobody knows. Not even Tim Cook...
Scott (35:09 - 35:15) - Facebook has communicated that directly, right? They’re just saying we don’t know.
Dee (35:15 - 35:47) - There’s a further piece to this, Scott, which you might have mentioned on one of our calls, right? It’s not gonna be a single-day event. It’s not like we’re gonna get clear with one day, okay fine guys, it all happened on one day, now we know out of the entire world of iPhone users, 50% opted out, poof! We can make decisions accordingly. It’s like, how many people are gonna update their phones? Across how long? How many people are gonna opt-in and opt-out based on the people that updated their phones? How long? There’s this curve that’s happening…
Scott (35:48 - 35:57) - Or your other point is how many are gonna opt back in when they realize the user experience starts to suck. My newsfeed is no good now, why?
Dee (35:57 - 38:25) - Yeah, or they start seeing ads for a retirement home when they’re 22, things of that nature. There are a lot of unknowns here, which is why we’ve been focused so much on understanding what lives within our sphere of control versus what lives outside of that. You can’t control the waves, you can control how you build your boat and you can control how you steer your boat, but you can’t control the waves nor the clouds. Right now, we’ve got almost, like, the war of the titans happening in the skies between Apple and Facebook and all of us boats are at the bottom just looking up at the clouds like, ‘please, just don’t let a lightning strike hit my boat or like anywhere close, man.’ Everyone’s looking up, being what’s gonna happen and how’s it gonna happen. It’s almost like watching a Godzilla movie and just, this punch that takes forever because they’re giant, happen, and guessing who’s gonna win. What’s really important here to note, also, is the fact that there is some reprieve. Outside of all of this stuff that Facebook’s been putting out publicly, there’s a lot of stuff that Facebook isn’t putting out publicly, first of all. Everyone’s awaiting with bated breath, but I think the other part also is, the depth of how much Facebook knows about their users, from a cross-referencing, cross-tracking standpoint, it goes a lot deeper than what us in the public know. There are a lot of other data points that I believe can be there as well and keep in mind that from a data vacuum cleaner analogy standpoint, ATT has not dropped and users have not dropped out. I’ll bet you that, I don’t know how many of you guys own a Dyson, but that vacuum cleaner right now is on max suction mode and not regular mode and it’s just as much recency as possible, preserve that because you can feed the algorithm with that data accordingly on those users. So, it’s not, again, not gonna be a cliff, but just preparing for it, even if it’s still waters, we know that we got a boat that can survive a 20-meter wave if it gets to that.
Ray (38:25 - 38:48) - The thing that we’re putting our faith in, really, their business model. Their business model’s data to advertise and, obviously, they’ve been the number 1 for this many years already. Hearing you, Dee, if anything, gives me faith in how much data they actually have on people that we don’t know about. Trust one thing, trust that Facebook has more on you than you expect.
Scott (38:48 - 39:54) - And they’ve got access to other data points, right? They’re still getting data fed back from credit card sources. I still think there’s gotta be that type of external, third-party data being fed back which is gonna impact things, and we just don’t know, going back to the timeline of events… let’s just say that this is a bit of a frog in a boiling pot situation. It’s like a 12-month deterioration of things, but how much can Facebook learn and improve within that 12 months to offset that as well. There’s so many different things going on here that are gonna impact. It’s just, no one can forecast, but let’s touch on that then… how can we best prepare strategically? Where does that need to shift to make sure that we’re prepared for the worst case outcome and not in a situation where you’re reliant on Facebook or whatever other app, it’s not just Facebook that’s gonna be impacted by this, it’s gonna be most traffic sources. What needs to shift here to, essentially, build a more robust business for yourself going forward?
39:56 - 43:13 - Building & fortifying your back-end systems
Ray (39:56 - 40:33) - Well, you kinda mentioned earlier, I think, what we’re doing internally which, based off Dee’s research, we kinda made the internal decision that back-end has to be almost king for 2021 and the data that you do have for your brands, maximizing that, getting more of it because, if anything, 2020’s taught us, especially now, here in January 2021, you need to own your own data, what Dee said. Set up your own first-party tracking and cookies, especially your own lists. Lists has to be number 1 and community building. That’s gotta be the thing for 2021.
Dee (40:41 - 42:56) - For the past however many long, the dance was, the takes two to tango was, like, Shopify-Facebook, those were the two that took to tango. Realistically speaking, now, the it takes two to tango is front-end acquisition and then back-end retention and those two need to tango to be able to make the dance work. Otherwise, you’re just dancing alone and looking like an idiot. Even when you don’t have the technical implementations in place, that will see you through. Right? Understanding how to acquire new customers, understanding how to grow your brand, the awareness of your brand, the goodwill placed in your brand, and new customers coming to your brand. Then, on the other side, how are you able to get those customers in your own ecosystem and start own channels, the whole owned/earned/paid media… That conversation is gonna come back a lot into this mix as well. I think influencers, anyone that owns an influencer platform, like a SaaS play, they’re probably looking at this and going, ‘this is an angle, for sure.’ We’re gonna come in there and we’re gonna start going heavy on this because, now, influencers become, especially if you apply a performance influencer marketing type of marketing to this, it’s like performance TV almost. You pick your TV program or your face that speaks to this specific audience and, because it’s digital, you’re able to tie back the campaign down to how many sales came out of that campaign or what engagements, if you’re looking at it from a performance branding standpoint of like, not only goodwill in your brand but also how many dollars got put into your pocket, up from a direct response standpoint. It takes that zooming out of like, okay where does the branding side of things sit in here to not just DR slam, slam, slam! From like a level of thinking perspective, brand-building standpoint, and business-building standpoint.
Scott (42:55 - 42:56) - Totally.
Ray (42:56 - 43:08) - I think the last one too is diversification of high search intent platforms. This may be the year that good ol’ Google comes back raging right, Bing, eBay…
Scott (43:08 - 43:13) - Shopping’s so underrated anyway. It’s so underrated. It’s the shit.
43:14 - 48:14 - What can eComm brand owners & marketers do to prepare for the arrival of the iOS14 ATT prompt?
Scott (43:14 - 43:47) - We’re gonna dial it down, Ray, Dee’s on a little bit of a timeline here. But I wanna ask one more thing, just to put a different hat on. Dee, you’re a brand owner, eCommerce entrepreneur right now. You’ve got an internal marketing team or a CMO or you might be using an agency for your whole marketing strategy. If you’re a little bit out of the loop of what’s happening or don’t understand, what should you be asking right now to make sure that your team knows what’s going on and is prepared? What do you need to be doing from here?
Dee (43:47 - 46:28) - I think the right first question to be asking at the decision level, at the decision-maker level is to speak to someone or at least do the research to understand, again, what sits within the sphere of control and what sits outside of that? Understand where the certainty and uncertainty lies, down to the bullet point list. If you need to wrap your head around that, my Twitter, again, I’ve been appointing myself as an investigative journalist for my own version of 60 Minutes on this, so go to my Twitter feed, @RealDoseofDee, and you can get yourself up to speed accordingly. The questions to ask, the key focus areas are, what can the APIs do for me? What can server-to-server do for me? What can it not do for me? In other words, where are the, when I take this pill, what pains does it fix, what pains does it not fix? The thing I worry about is people think server-to-server, all my problems are gonna go away, which is definitely not the case. To be able to segment all the issues into, let’s look at optimization, let’s look at tracking, let’s look at measurement by way of reporting and attribution, and let’s look at the whole restriction, aggregation, and delay. I had to go to that exercise of breaking down all these things into different thinking buckets, first, to really wrap my head around the issue ‘cause a lot of them are very overlapping and blending because of one ad platform so my brain wasn’t able to do that. Once you identify those, then go into server-to-server, look into APIs, and then absolutely think about from a strategic standpoint, what are the different angles, plays, perspectives, and then the other part is looking at it from, and if you’re a CMO or you’re running a house of brands or anything of that nature, you should be looking at MER anyway, by that point. I’ll be preaching to the choir at that level, and for those listening that aren’t thinking about MER, I got two recommendations for you. Go to Google, type in MER, Marketing Efficiency Ratio or Marketing Efficiency Rate, you can get yourself schooled on that way of thinking and it really is a way of thinking rather than only just a way of measuring. The other part is, if you wanna learn about media mix modeling or marketing mix modeling, MMM, there’s this really cool tool, Vexpower.com, I’m not affiliated to any of these things by the way. Vex Power is free for the most part anyway. You can learn about how to actually calculate media mix modeling.
Scott (46:28 - 46:57) - Perfect, perfect. Alright, let’s wrap it up. We’re gonna have probably an ongoing series with this as things come to awareness and changes happen real-time. This is gonna be something that’s a huge topic for, I think, the whole year. It’s just gonna be ongoing. We’ll keep this going in a few different conversations. Dee, where’s the best place to follow you, keep up-to-date on what’s going on, outside of this podcast?
Dee (46:57 - 47:43) - Outside of this podcast, naturally, our Right Hook page, we try to put as much stuff in there as possible. The most real-time stuff I’m putting up is my Twitter, @RealDoseofDee. If anyone here happens to own an iPhone, haha!, that has a Clubhouse invite, I spin up rooms every once in a while and just like jam with very smart people around the iOS14 thing. Clubhouse was the platform that allowed me to interface with the ML experts from Stanford and a lot of attribution experts so I just spin up the rooms. I’m kinda known as the guy who won’t stop talking about COViOS14 and won’t stop trying to make that a trending hashtag. Every time I spin up a room, people don’t know what to expect.
Scott (47:41 - 47:43) - It’s catchy! It’s catchy.
Dee (47:45 - 47:49) - And it’s catching on too so that’s kinda dope. But, guys, this was super fun, man!
Scott (47:51) - Awesome!
Ray (47:51) - Thank you, Dee!
Scott (47:52 - 48:04) - Alright, thank you all! We will be back next week! Appreciate it and get prepared. This is gonna change the industry in a big way so make sure you’re up to date. Thank you guys!
Dee (48:04 - 48:11) - Don’t forget to like, follow, subscribe, comment, share. Hit the bell button, all that good stuff! Like, comment, share, follow, subscribe, subscribe, subscribe!
Scott (48:11 - 48:14) - You got it! What Dee said, see you guys!
48:15 - 49:10 - Episode Outro
Scott (48:15 - 49:10) - Thanks again for tuning to this episode of the Growth & Greatness eCommerce Podcast. We hope you got a ton of value out of this episode and if you did, we’d love for you to leave us a review on your platform of choice and help us reach as many people as we can. Now, if you’re a brand founder, an eCommerce entrepreneur, or an in-house marketing manager looking to accelerate your growth this year, reach out to us at Right Hook Digital. We’re a performance branding agency and we specialize in partnering with eCommerce brands to help them hit their growth goals with maximum ROI. Now, if this sounds like a solution that you need, check us out at righthookdigital.com and schedule a call with our client partnerships team. They’d love to have a chat with you and see how we can help you grow in 2021.
