Adam Sharon-Zipser: I messaged my brothers. I'm like what the fuck? Like we spent so much money. How did he, how did he not know who it was from? Was there no card, no message? People spend more on others than themselves and that ended up being over 20% for an index across all the brands that we're seeing. So AOV is 20% greater for gifts compared to your baseline. If I switch creative on Monday and it goes into learning for two days and then on Wednesday my MER is better or worse. I can use very micro attribution windows to figure out what's driving success.
[Voiceover]: Welcome to add to cart, Australia's leading e commerce podcast that Express delivers all you need to know in the fast moving world of online retail. Every week Nathan Bush from E Suite and an e commerce industry expert will share the news, research and insights that you need to know to keep you at the top of your game and of course keep your customers adding to
Adam Sharon-Zipser: cartoon
[Voiceover]: hello add to Carters and welcome back. Now today's guest already had a bit on his plate as a founder and Managing director of one of Australia's leading e commerce agencies, but it was a little innocuous purchase of a 70th birthday present for his dad that pushed him to add a whole new product to the pile and really ignited his passion for for improving the online gifting experience. Adam Sharon Zipser is the founder of GiftNote. GiftNote is a Shopify app which allows gift givers to have an SMS or an email arrive to the gift recipient within 30 minutes of their delivery. Adam today tells us how he does that. It solves the problem of impersonal or even worse, unknown gift deliveries. Adam is also the founder of Elephant Room, an e commerce agency that helps e commerce brands grow through paid performance, website development, UX integrations, analytics and a lot more. They've worked with brands including Budi, who we've had on the show, Bed Threads and Sur the Label. I wanted to have a chat with Adam to dive into the gift giving experience from a solutions perspective. We've had lots of great gifting brands join us on the show, but I wanted to hear from someone who is breaking down the gifting barriers for all. I am so bullish on the opportunity to radically improve the online gifting experience and so it's a little bit of a sweet spot for me. In this chat we cover how GiftNote is improving the gifting experience and we talk to what makes a great gifting experience and what that looks like. We also go broader with Adam's experience and visibility over the Market and cover how to outsmart the performance media algorithms. Hot tip. You can't. Sorry to disappoint you. And we also talk about Adam's favorite measurement tools for different sized e commerce businesses. So thanks to our partners, Shopify plus and Paclio. Here's our conversation with Adam Sharon Zipser, Director of GiftNote. Adam, welcome to Add to Cart.
Adam Sharon-Zipser: Thank you for having me, Nathan.
[Voiceover]: I'm very excited to get into this conversation. We're going to talk a lot about gifting here and we've had some great gifters from the e commerce side previously in E commerce, the lovely guys, Manflower edible blooms. I feel we're almost over indexing in gifting. Is that the case in Australia? Do we punch above our weight?
Adam Sharon-Zipser: Yeah, it's an interesting question. I'd say there's two parts to this. One is the geography of Australia compared to other regions. So we've got fewer larger cities compared to other areas. And what that means is that delivery options, you can get a bit creative with delivery options. So same day delivery is a big thing, which obviously works very well in a gifting context. So I think what happens is you obviously consumers live everywhere, they're always going to gift. You've always got your seasonal and your BAU gifting. But I think when you merge some of the logistics, the geography of it with the delivery options, you can actually allow brands in this region to create really nice experiences. So for example, Donuts is a really cool one where they could come out of the oven that morning and be delivered to someone before lunchtime.
[Voiceover]: That's pretty cool.
Adam Sharon-Zipser: Flowers a bit different. They obviously can stay. They have a different shelf life. But yeah, I think that's what makes maybe Australia a little bit different. And if you were to look at all the gifting data in Australia, it's probably like your major cities really.
[Voiceover]: All right, we're going to dive into gifting and what makes great gifting experiences. But let's take a step back and give people some context. Now, you are the founder and the director of GiftNote as well as Elephant Room, correct?
Adam Sharon-Zipser: Yes.
[Voiceover]: Tell me how those two work together.
Adam Sharon-Zipser: Yeah, it's an interesting one as well. So Elephant Room is an E Commerce performance agency. I founded the business nine years ago. We're a team of 40. We pretty much exclusively focus on three key domains. It's acquisition, so paid media in particular across search and social experience, specifically Shopify development and projects and then retention, specifically Klaviyo and like loyalty program implementation. So it's a full funnel service and it's only for DTC brands.
[Voiceover]: Pretty incredible brands in there.
Adam Sharon-Zipser: Yeah. So we've, we've been really fortunate to acquire and work with some of, like, some of the best DTC homewares, fashion, apparel brands in Australia. And when you do that for long enough, you learn a few opportunities and you can see parallels between what other retailers need and want. And then during COVID where I thought my world was imploding and collapsing, one of my other founders, he had his first baby boy, son, my dad had a 70th and the whole gifting process was a mess. And over the course of a year after that period, we sort of put some talent aside. Instead of like telling them to work part time for three months, we double down and we started building a tech product. And that, that created Gift Note, I
[Voiceover]: guess, very similar to we had Gav from Disco and Submarine on a couple of weeks ago. Obviously very different product, but similar mentality. Right. It's like you got this agency solving problems, finding the same problems over and over again. May as well make it a product.
Adam Sharon-Zipser: Exactly, yeah. And I mean, that obviously comes with its perks and challenges. And Gav is this awesome developer, he's got an amazing engineering practice and yeah, there are a lot of parallels there.
[Voiceover]: So when you were thinking about this from a gifting perspective, was it your personal experience you talked about your dad's 70th, the newborn, was your personal experience, or was it what you were coming up against in the agency world and what your clients were asking for?
Adam Sharon-Zipser: It was a factor of both. You obviously get a brief from a client sometimes and you have no context and you're like, I don't really appreciate it, but I know the solution and we can implement it. And then Covid came around and my dad had a 70th, Matt had his firstborn, Nick as well, who works in the team, had his firstborn over November, by the way, which is Black Friday period, which was absolute chaos. But we ended up sending my dad, like between both my brothers and the whole family, like a wardrobe that was like an Aaron Williams wardrobe. We spent quite a bit of money, it was quite nice. And we gave him an upgrade, but he sent on the WhatsApp. He's like, thanks for the gift, but I don't know who sent it, which son sent it. And then I messaged my brothers in a private WhatsApp. I'm like, what the fuck? Like, we spent so much money. How did he, how did he not know who it was from? Was there no card, no message?
[Voiceover]: You should have Just claimed it just like it was all me.
Adam Sharon-Zipser: Just take, take their contributions. I agree, I should have. And then the same thing happened with Matt. He's like, dude, I'm getting so many gifts and I have no idea who they're from. And we actually had implemented a similar bit of tech for another client. With some smarts of the tech, which we can talk about later, we sort of went down this path of like, how do we solve this problem? Surely we can solve this problem. And yeah, it became more personalized and we found a whole product vision in here.
[Voiceover]: Great. So can you explain to us how it works?
Adam Sharon-Zipser: Yes. So there's two sides to it. The consumer side is pretty simple. You would have experienced this before. You're on an E commerce store and you can click send as a gift, you can add a gift message, but in the future that gift message can be a bit more creative. You can think video, you can think more rich media. That gift message prompts the consumer with three delivery options. Send now instantly, send later in the future or send on delivery, which was the first iteration of what we did. And send on delivery basically means we'll monitor the carrier and the tracking until it gets marked as delivered and then we'll send the gift message to them via email and sms, branded from the actual brand. So it would be, hey Nathan, happy birthday, hope you enjoy the socks from Adam, but you'll get that within 30 minutes of the delivery of the package. Or if I was, let's say, you know, from a baby's perspective, someone maybe buying a bassinet, which is furniture, comes a bit later, you can send that on a particular date or instantly as well. That's what the consumer experiences. We also do vouchers, gift vouchers in a similar setting. Anyone who's on Shopify knows how bad the gift voucher experience is. But then on the brand they get access to a whole sweep of opportunity. On giftable revenue. Most gifted products seeing the gift messages, doing it, allowing the customer service team to write the gift message, all that kind of stuff.
[Voiceover]: Do you take care of all the messages whether they are delivered within that 30 minute window instantly or on a scheduled date?
Adam Sharon-Zipser: Yeah. So basically it's a payload. So we capture it and then we hold it based on the preferences and then, yeah, we can deliver it according to what the user inputted and if they made a mistake, we give obviously the brand's dashboard to log in and modify it. You could also imagine like brands, if they're in a 3 PL, there's no sticking there's. No gifting opportunity if they're doing massive scale, which was also the issue. This is where it came from. So we can give them a completely automated, personalized and paperless gifting experience to plug into their stack.
[Voiceover]: Ever scrolled through an E commerce packaging website for fun? Nah, me neither. Until today. Paclio is putting the joy into the packaging game. So let's play a game. I'll tell you the name of the Paclio product and you have to try and guess what kind of product they are. Fairy floss Compostable mailer. Queen Bee Honeycomb Padded mailer. Here we go. Gummy Shark Water activated tape. Now if my jaded self thinks that this packaging is fun, imagine what your customers will think. Paclio is also eco friendly. Australian owned and operated with same day dispatch and 14 day returns. Now that's pure joy for everyone. Check out the Paclio range of ecommerce packaging options@paclio.com that's Paclio P A C K L E O paclio.com. Did you say customers can leave a video message as well?
Adam Sharon-Zipser: That's what we're working on right now. We don't know if it's going to increase the propensity to gift, but it's a cool feature and I think, I think it's exceptionally memorable. And really it's the stickier that the process is, the better it will be. That's the general mentality.
[Voiceover]: I love that idea because you think about how much time most people spend in thinking about planning, shopping around for presents and then you're left with this. Excuse it, but a shitty little text box.
Adam Sharon-Zipser: It doesn't do it justice. No, it doesn't do it justice. And especially if there's a family you can think like group gifting as well. So if it's a milestone birthday and you know, for example, my brothers, what if we all went in together, separate video, each. It can compile it. So if you start thinking about the future, it gets a bit more engaging and it's just sticky. It's just more fun.
[Voiceover]: Then you'll get acquired by Hallmark.
Adam Sharon-Zipser: Yeah, I mean, yeah. I mean, then I might have you on my podcast then who knows?
[Voiceover]: You won't be doing podcasts.
Adam Sharon-Zipser: Okay, great.
[Voiceover]: And then is this always been the intention from when you had that idea from your dad's 70th? Was it always this execution?
Adam Sharon-Zipser: Yes, but we've onboarded 200 customers. We've been getting great exposure to a whole different world of opportunities and problems. And the whole roadmap is essentially fueled by our Customers right now, what they're asking for, a lot of integrations, a lot of bespoke carriers, particular limitations that they want to offset. And where it is now is very much the same of the vision, but it's obviously expanded out a bit. And the analytics side is where it gets quite interesting. And that's really the new insight that we're getting now with, like, we can actually see some pretty impressive numbers in this whole gifting space that we only had assumptions on. But we can actually prove it now because we've sort of closed the loop a few times.
[Voiceover]: What surprised you the most so far?
Adam Sharon-Zipser: The aov. The AOV lifts for gifting. You sort of knew like you kind of people spend more on others than themselves. So that was like the first one that we had our gut, we're saying. And that ended up being over 20% for an index across all the brands that we're seeing. So AOV is 20% greater for gifts compared to your baseline.
[Voiceover]: Wow, that's pretty cool.
Adam Sharon-Zipser: That's pretty cool. I was like, all right, well, there's something there, right? AOV is one of the golden metrics with sessions and conversion that all merchants want to lift. And if they lift it accurately, the incremental sort of downward impact is huge. So that was that. But the other one was the first time customer conversion rate from recipients. So if I buy you the socks for your birthday and then you love them so much, you buy another pair of socks because you're gifted the socks, because we've identified you as recipient, we're watching every new order come in and then you reconvert as a first time customer. Because the gifting email that we sent to you said, hey Nathan, happy birthday. And here, by the way, here's 10% of your first purchase. We actually can see some pretty cool stuff. There's like an 18% reconversion rate from recipients to first home customers. And some brands are very different. Some brands are like at 70% if they're a pure gifting brand. So think about flowers and donuts. You got gifted that it's. They're a purist. You're like, oh, that's amazing. But that's what's super exciting. We didn't really think about that prior. We actually can see the customer the whole way through and actually cohort them accordingly too.
[Voiceover]: Yeah, that's interesting. And it's been a theme that's come through a lot of the gifting conversations that we've had on the podcast from the founders saying one of the things we've always found is that if recipients have a great experience, then they do turn into great customers because it's such an emotional thing that yes, my delivery was successful, the person at the other end of it was happy, it worked, therefore we'll do the same again.
Adam Sharon-Zipser: Exactly. And I think that's what we're sort of leaning into the most. And I guess also customers who gift. If I buy you baby products but I don't have a family, why should my follow up reviews send me the review? What if the baby product I sent you was broken and was faulty? Customer service doesn't identify the recipient. So the whole recipient as a sort of user in the whole stack are kind of underrepresented. And our job of what we're trying to do is using the genesis of a gift note and the recipient to then really light up the whole stack with everything else around them.
[Voiceover]: Are you generating any insights from the messages or the text that's input around emotions, around occasions, anything like that?
Adam Sharon-Zipser: As creepy as the sounds like if I'm having a really shitty day, I love reading some of the gift note messages. You know, we're doing, we're doing hundreds, thousands a month. So you just kind of read through them and you're learning about what some of the milestones are. And it's not in a weird stalker cam way. You just want to understand how people are using it and how long the characters are. And are they using like text emojis, real emojis? Are they trying to add a GIF as well? That's another one. Like they're trying to be a meme. I mean, the biggest thing that we've identified is we've got our bau, our everyday gifting. Your birthday is your anniversaries, your engagements, your weddings, and then you get your seasonal gifting. So Mother's Day coming up, Boxing Day at the end of the year, Valentine's Day in February. So it's very surgy, like the, it surges very heavy towards Black Friday where people are using that period for gifting. So we're seeing like 30% of Black Friday Cyber Monday orders as gifts for either that period or most likely Boxing Day. And then if that's a, you know, the GMV that's generated of that period, if we can control or touch 30% of that. I'm. Yeah, I mean, I think, I think it's a wonderful idea.
[Voiceover]: And are you getting that customer and recipient data as well as the retailer getting that data?
Adam Sharon-Zipser: Yeah, for sure. So gift Note has the data. We're not sending them any follow ups. But in the future we could potentially think of like a gifting marketplace. There's a lot of broader ideas because, you know, there's like over 50,000 gift recipients that we've sort of touched. But yeah, it's the, the brands have access to it, but it's also contingent on privacy policy as well. So we have to be super careful. A recipient isn't an opt in. Me buying you socks doesn't mean Nathan is keen on getting sock edms. So gifting emails are transactional by nature, which is approved by the vendors. But we have to be. There's a fine line of what you do with that as well. And ultimately the brands have access. But we're very clear on our stance.
[Voiceover]: That makes sense. That makes sense. And so from a retailer's perspective, if we've got listeners going, oh, I'd like to see this in action, where would you recommend that they look? Which retailers do you think they should check it out on?
Adam Sharon-Zipser: Dr. Doe Donuts is one of our largest gift our customers. There's also croct that does clay at home. They were a Covid boom business. Two amazing brands. But then there's lots of brands. Bed threads is another one. Write arts and crafts.
[Voiceover]: There's.
Adam Sharon-Zipser: There's a handful. If you visit giftnote.com, you'll see a logo wall. We will be releasing shortly Store directory too as well.
[Voiceover]: Cool. And when you said that the average order value of a gift is 26% more than what people would spend on themselves, do you find that the retailers that you work on, work with go above and beyond to say that they've got this elevated gifting experience so that they can draw in people who go, I was here to shop for myself, but actually while I'm here, yes, I might spend on gifts as well.
Adam Sharon-Zipser: So this is, this is one of the big challenges that we don't feel that brands are merchandising their products well enough in a gifting setting. They might do occasional collections, but I think bundles are obviously a wonderful thing to gift. Sample packs as well are awesome things to gift. We definitely feel. And part of our like our success in our onboarding is to say, hey, if you maybe did a PDP template a little bit differently, actually make this a bit more of an endearing gifting process. You'll probably see a better conversion rate and just put yourself in the customer's shoes. Like they probably want something a bit more geared for gifting. So that's what we trying to do is Expose the merchandise insights. What are most frequently gifted products? What's your most popular gifted color? So they can actually merchandise it a bit better. And that's one thing that we really want to do.
[Voiceover]: What are some of the simplest tips that you think retailers and we're just talking standard retailers who might offer the gifting service but aren't a gifting business per se. But what are some of the most standard tips, especially around ux, that you think they can implement to make sure that when customers get there they go, yeah, I can shop for myself. But also this is a great place to send a gift.
Adam Sharon-Zipser: Definitely. I think install Gift Note number one shameless plug. I think you've got care instructions, you've got delivery returns information. I think typically a lot of brands use putting that in an accordion. Just simply put sending us a gift question mark as another accordion and just give them plain simple English just saying, hey, if you're sending a gift, feel free to look at how we do it or feel free to see our gifting range or just explain the mechanics a little bit more. Maybe they aren't in a 3 PL, maybe they do print and they stick their, they handwrite their cards or whatever it might be. Just let them know that your PDPS and your homepage are going to get the most traffic from a media and an SEO perspective, right? So wherever the maximum surface area is put your important assets and your important information. So that's a starting point and then you can convert it into a landing page. Maybe in your FAQs you put in again, that's a very commonly visit page. Do you offer gifting? It's like yes, we do. Read more about our gifting services here. And it is brochureware to begin with, but I think it's a, it's a cheap, inexpensive overnight activity that you can do. And then maybe now after doing that, your customer service emails one email a week that talks about gifting. As they slowly come in, you just start learning about it. Just ask, quiz, figure it out. Something will reveal itself.
[Voiceover]: And it's interesting that you bring up that brochureware point because I think it's really true is you can offer gifting and probably not change a hell of a lot on the front end.
Adam Sharon-Zipser: Exactly.
[Voiceover]: At times where do you see where gifting starts to take off for retailers? Both from your experience at Elephant Room, but also now at Gift Note from a process perspective, where can you see it often going wrong? And you really encourage retailers to look at to make sure that the whole gifting experience is first class, not just the front end.
Adam Sharon-Zipser: Yeah, it's true. So I think operationally offering things that don't scale. Well, I know I'm sure everyone's read that Y Com do things that don't scale. But I think when you're, you're doing a thousand orders a day for some brands and you're trying to print labels and you stick them on boxes, well, your team are burning the midnight oil. It's not a good thing. You don't want to be dealing with that shit. It's just not a process that makes sense. So that's one of them other things I guess is just keep it as simple as possible. And I know this sounds very vanilla, but using an app like Gift Note, for example, it's totally branded, it's completely paperless, so you're getting a nice green tick. There's no humans involved. So it's completely automated. And then you're sort of, it sort of, sort of works itself in the background. And I think gifting is one. But it's the same way. Like, you know, if you were doing UGC and reviews, no one in the customer service team is following up a customer to say, hey, hey, do you like our product? Here's a five star review. So you want to find nuggets off your experience that can be streamlined and totally automated without losing the personal flavor. And I guess those are the main ones, but I mean, every brand is so different.
[Voiceover]: Yeah, they're great tips. One of the best ones I heard was from Kelly at Edible Blooms and she said they recently took away their NPS and their thing was okay, here's an email that you get after placing the order. If something's gone wrong or if you're unsure after placing the order. Here's our contact details to get in touch with us straight away because we want to solve it immediately. We don't want to wait till you have a complete complaint because by then it's too late. Right. Yeah, the moment's over. Or if you've had a great experience, leave us a great review on Google. So kind of directing customers to two points depending on where they are on their journey. Hopefully you don't get any better in the emergency bucket, but I think that's much more actionable than go tell us how do we do?
Adam Sharon-Zipser: Yeah, and I guess that's why some of the reviews and the MPS is also very biased as well in a way because only maybe hearing from only the nasty people are people do they have the greatest propensity to write a Bad experience and a good experience. That's why if you looked at all the six star or five star hotels on Google, you only see shitty reviews. Like people who had great experiences don't write about them. They share it on their Instagram. They don't, they don't write a star review. So it's an interesting insight.
[Voiceover]: Yeah, absolutely. Do you foresee because gifting is such emotional and personal thing, both you think from a sender's perspective, you often write a lovely note that's heartfelt, that feeling that you get when you receive a gift. Do you foresee AI having any role in this process, especially around messaging and communication?
Adam Sharon-Zipser: Oh yeah. I mean you could get prompted or cues. Like even Shopify has like a product description generator now. Like, hey, write me a funny gift poem, you know, to Nathan about socks and his 30th birthday or 40th, whatever. So I mean that's 60th, but I mean, yeah, like that's, that's definitely an opportunity. We've, we've been using chat GBT internally just to mess with ad copy. Yeah. Like write me a haiku about something. You know, it's pretty fun, it's funny, it's. And you get it back and you're like, oh, this is great to love this.
[Voiceover]: It's either they're going to love this or they've cheated their way to a birthday. And then so from a retailer's perspective, you mentioned around Shopify integration, are you shopify only at the moment, yeah.
Adam Sharon-Zipser: So we are right now we feel that ocean is big enough to boil, but we have an API first mentality. In time and in the future we will sort of open it up. We sort of monetize purely on what you use and what you send. So more that you put in more inputs, you could potentially implement POS in the future. Other sort of SaaS vendors. So we will expose a gifting API and gifting infrastructure in general.
[Voiceover]: Okay, gifting infrastructure. That sounds pretty big.
Adam Sharon-Zipser: Yeah, I mean we're not going to be a stripe, I'll tell you that much. But it's ultimately there's, if you think of it from an engineering perspective, there's. Your endpoints are write a gift, edit a gift, send a gift, delete a gift, modify gift. So there's, there's lots of different ways that our internal tech is working that if we just sort of expose it. Someone who's savvy enough that doesn't want to do all the carrier infrastructure and doesn't want to do the klaviyo integration doesn't want to do the email templates. They get the best of the tech in the back, they get the analytics, or they can just pipe in whatever data they want and then it becomes a very interesting volume game at that point. So that's where it gets a bit more interesting. It's similar to Stripe. Like, okay, it's built for developers, but you can embed it in whatever shape or form you want. Yeah, so definitely having an IT background. I mean, I definitely think more on that side first and it feels like a natural fit later on.
[Voiceover]: We know that customers are going to be more price conscious in 2023, but it doesn't mean that they've lost their soul. Shopify conducted a global survey to understand customer trends and found that Australian customers are actually the most passionate about buying locally to reduce their carbon footprint. And while price pressure won't go away, the research showed that the majority of Australian customers will wait longer for delivery and recommend a price product that is sustainable at its core. We're such a good bunch here, aren't we? To view more resources to help with your 2023 planning and see how Shopify can take your e commerce business to the next level, visit shopify.com au today. And in order to achieve that 30 minute delivery window of a message arriving within 30 minutes of that delivery, do retailers have to do anything extra within the Shopify setup for that to work?
Adam Sharon-Zipser: Yeah, so we've, we've bashed heads a lot regarding our onboarding process and it's very, we have a particular way of doing it. We're going to index 30 days worth of order data, we're going to sample that, we're going to look at all your fulfilled orders, we're going to get the tracking number, we're going to identify the carrier that you explicitly set and then what the carrier is where sometimes is a mismatch. What we then do is build a map to say, hey, this is what we've automatically identified based on these orders. Can you confirm a sample set? ABC, DHL, Auspost, Star Trek, whatever, FedEx map those and then we sort of, then we've defined the pattern and then every future order that comes through is sort of added into that index. Then there's scenarios where things that we don't match and we get alerted for that and then it's a slack ping. And then we reach out to the vendor to say, hey, what's going on? Can we support you? Is who is this? What is this? Right, so we had that recently happen with Uber Direct where they were doing same day delivery with Uber and we saw that come through and there was like latency because we, we know the average time to fulfill and there's certain flags that tick off in our system to say, hey, this is like a latent or delayed order if it's a gift. Note one. Because obviously we, we don't want to disrupt, we don't want to create a shitty gifting process because otherwise that diminishes the whole thing. Right. So we put a lot of, probably too much equity on it and then we speak to the merchant and we build integration or patch it on the spot.
[Voiceover]: So are you integrated into the carriers at all?
Adam Sharon-Zipser: Yeah, over 700 globally carriers.
[Voiceover]: Okay. And it covers the majority.
Adam Sharon-Zipser: Yeah, I'd say we've got, I'd say we've got a 95% footprint. There's going to be maybe a random carrier in Fiji that we may not be able to sort of identify with. But we would ideally spot that on the onboarding because we would know the region if they're, if they're implementing in a particular area of the world that we know is a bit funny. And you can eyeball them as well. You just know that maybe the infrastructure isn't as known, let's say the Philippines, they might have a lot of motorbike deliveries and that's not easily tracked because it's just how the system works. Especially in Manila. We would identify that and probably alert the merchant to say, hey, we can't guarantee reliability here. Okay.
[Voiceover]: And then the SMSs for a customer obviously receive an SMS. Are they two way SMS or just one way?
Adam Sharon-Zipser: Right now it's one way. However, certain brands can implement with Klaviyo or in the future attentive postscripts, but they can use their two way config within a flow to handle it. I mean SMS is a contentious topic. Brands love it, consumers hate it. But there's a fine line. But I think we feel gift SMSs have a special place and they're not, it's not, you know, you're not getting that 4am message from Kogan that says hey, here's 40% off blankets. So we see it as a special spot. But brands who implement the Klaviyo side can have a bit more fun with it.
[Voiceover]: I can't imagine that you'd get too much pushback from people receiving a personalized message from their friend, their lover, their.
Adam Sharon-Zipser: Exactly. And if it's like personalized and it's like it's actually human and it's if there's some rich media attached and then there's maybe in the future a quick link to load a microsite that has like all the stuff and there's a lot of ideas around that that we're trying to unpack. You might even think maybe, you know, a gift is coming, you might have an opportunity to change the gift. Maybe I got you the wrong size socks. Maybe you have exceptionally large feet. I'm just rallying the sock example, I apologize, but you would say him.
[Voiceover]: I'm not a weird spot with large
Adam Sharon-Zipser: feet, but yeah, or maybe you got small feet, I don't know. And then you would be able to sort of control and maybe edit the gift prior to send out. So we're sort of looking at that. And Shopify APIs have a lot of nice freedoms in that space that we're figuring out.
[Voiceover]: Yeah, cool. And sorry, just on the sms, just the last thing there, is it actually the text from the sender that appears in the sms or is it a link towards another page?
Adam Sharon-Zipser: No. So the payload in the SMS is the raw message that's captured characters. Because the way SMS pricing, if you go over it gets expensive and we have to limit some use of emojis. But the SMS will be sent from the brand name as well. And then most we prompt the customer to finish with signing off as their name or we would automatically add their name just so it like looks like a real message like love Nathan.
[Voiceover]: Yep. Nice. Enjoy your socks.
Adam Sharon-Zipser: Enjoy your socks.
[Voiceover]: Yeah. And I'm sure your brain must be buzzing at the moment when you start connecting messaging with timing it to delivery that this goes beyond gifting. Right?
Adam Sharon-Zipser: Yeah. So as a whole there's a few conduits that you can, we can live on. Vouchers is a very interesting space as well. I think that there's a. You know, I've got a lot of experience and background with like double sided marketplaces and I understand sort of some of the economics in that space. And you can think that maybe if I had a thousand stores and I had a gift directory, one could do some pretty cool things from a voucher context around that Universal vouchers, like hey, I don't know if I want to get you from brand A, B or C voucher, maybe I can get you a generic voucher that you could split out. And we're sort of thinking about what that world looks like integrating with a Qantas store as well so people can redeem some of their points for maybe a generalized voucher. We can handle that tunneling there's like Givex integrations and Blackhawk network integrations as well for the physical vouchers that you would see in Woolies or Coles. So there's a very large conversation that we can potentially do and there's a whole different commercial model that lives behind that. But I mean, we've got a lot of problems to do and we've got a small team with no funding. So we incubate the whole thing through elephant room and we're gradually tackling them one by one. But the vision is pretty interesting.
[Voiceover]: Is funding on the cards, do you think?
Adam Sharon-Zipser: Not in the current market. I think it's a complete mess out there and everyone's getting scrutinized quite heavily. We've got this very nice luxury where we've got a very well established agency with amazing customers that we can trial and incubate ideas with very quickly. That's sort of our unfair advantage. If someone was to go up against us, they wouldn't have 80 clients and in their book they wouldn't have that exposure, that access that we do. So right now we're incubating as best as we can. We probably want to get to a better state of revenue and I think we can actually be profitable out of the gate, which would be very different to most SaaS vendors. So I am targeting profitability first. And being in an agency world almost a decade, you're trained to know like you can't just run on fumes like every other SaaS vendor. You need to your people business. And I think culturally I can adapt that into a SaaS business. Yeah, beautiful.
[Voiceover]: From a commercial perspective while we're there, from a retailer's world, how are they paying for this?
Adam Sharon-Zipser: So the app is. I'm going to sound like a salesman is free to install and free to use. So you only pay for what you use. It's a dollar a gift note. It's one US dollar a gift note. If you do large volume, that price can go down. What we're finding though is brands that have seasonal gifting, it's not fair to charge a recurring fee for just literally looking at their gift messages. There's no cost to us. We don't want to pass that back to the, to the merchant. We see that volume is the key and we also want to offer a freemium service where we can do bulk gift voucher generation. Nothing that's actually related to the gift note itself. More gifting mechanics that they can use some of our competitors because there are some people in the space use like percentage of revenue. It's a very large aggregate pricing. It's not proper usage, it's percentage of order. We think if I was a brand and we've spoken with enough brands, like enough in general, there's no way that would fly. So we think our pricing, we know our pricing is the most fair and the most honest in the market.
[Voiceover]: And it feels like most retailers offering a gifting service, if done right, can absorb that in additional gifting costs, whether that be packaging or.
Adam Sharon-Zipser: Yeah. So Dr. Doe donuts. Actually, they, they impressed us with a very interesting way of doing it. They use Gift Note. They created like an arbitrage. They use Gift Note as a freemium. So everything is free, but then if you want a handwritten card, they'll charge $5 for that. Whereas before Gift Note, everything was handwritten.
[Voiceover]: Yeah.
Adam Sharon-Zipser: So we actually, we actually put handwritten more on a pedestal. Everything is free and then if you want handwritten, it's five. And that actually became a revenue stream for them. So let's say I don't know how many they're doing, but X amount per day is handwritten and way more like it's a whole different process. Right. They can do that and brands can actually build on top of it in that way.
[Voiceover]: That's smart. Real smart.
Adam Sharon-Zipser: Yeah. So that, that was impressive. And then we were like, oh, shit. Like you've totally offset the app costs by just making us free and then putting everything else as like a premium on your manual one. Which is amazing.
[Voiceover]: Yeah, fantastic. That's a great tip. Thank you. So Gift Note, that was. That's a. We've covered a lot there around, obviously the product, but also how to do gifting. Well, if we take a broader view on E commerce, which I know you've got with, with all your great clients at Elephant Room, where would you say the state of the market, the e commerce market in Australia is at the moment, from the. The three pillars that you do, where are you finding most of your retailers are spending their time and money at the moment?
Adam Sharon-Zipser: Yes, I think historically a lot of the merchants and brands, they've nailed their supply chain. They've Covid broke them and rebuilt them. They're much more solid structure. They've identified their processes, they've seen, they saw unprecedented demand. They know how to ship, ship, they know how to get something. They know how to do great customer service, they know how to do great returns and that there's obviously will be improvements and innovation in that space. The biggest thing that we're seeing right now, which Is, you know, there's a billion dollars a year or something spent on paid media. There's a lot in that space where brands are trying to understand attribution, trying to understand roi. The whole ITP and tracking thing was a big impact for a lot of brands. They lose, they're getting fuzzy reporting, they just don't know what bang for buck the customers are doing. And we're spending a lot of time investing in this separately to Gifno, just that on the elephant room side, just understanding how can brands do proper measurement, looking at MERS or marketing efficiency ratios, looking at NCAC new customer acquisition costs and really understanding, deeply understanding an LTV but also adjusted LTVs because everyone did a price change a year ago. So what we don't like is like a lot of the out of the box tools like your triple whales and your glues and udacities, they're all great but they don't consider that anomalies in your data. So your LTV data that consists of a 15% price increase over Covid or last year, there's no parity there and we're spending a lot of time just understanding measurement in that space and I think that's been a very, very big topic for us.
[Voiceover]: What are your go to measurement tools?
Adam Sharon-Zipser: It depends on the brand. If they're spending over 250, 000amonth, there's a whole suite of like media mix modeling tools and it's a massive statistical sort of framework. And my concern and what we're nervous about is that a lot of marketers who are incredibly savvy and switched on, they don't neither. Not too many agencies have data science degrees and they're pretending to be practitioners in this space. Split testing is you know, ubiquitous now. I think you know like what's significant between two variants or three variants. I think that's an easier thing to dictate is if you don't have that background. But looking at proper media mix modeling, causal impact, looking at the open source frameworks from Google and Meta, it's very complicated and we're sort of leaving. That's a bit of a black box right now. Recast is an amazing emerging company. There's Bimodal in Australia by run by Tom who we work closely with. There's a few. But then if you're under that spend, which 90% of the retailers are look, we've been looking at incrementality testing so changing one thing and understanding the impact off everything else based on your north stars, your branded impressions Your traffic and your revenue.
[Voiceover]: Right.
Adam Sharon-Zipser: And then looking at more aggregate numbers like an MER and pacing your MER over time. That's the modern way to do marketing right now. And that's where we're really understanding it. And GA4 is coming into the mix. They're not using last click, they're using data driven attribution. So look, everyone's going to have a headache at the end of the year, which would be great because it's a good opportunity for us. But yeah, everyone, GA4 is in full swing in December and November and they're looking at last click and like their SMS and their email campaigns get smashed and their brand campaigns get smashed and everything else gets reallocated. Yeah, it's going to be an interesting conversation.
[Voiceover]: And if I read between the lines there, it sounds like you're saying the days of day trading e commerce are over.
Adam Sharon-Zipser: I think for some spending clients like we have day, we do have a handful of clients where there's a day trading mentality. But you're not necessarily moving budgets. You might be switching creatives around. You'll see again, using this incrementality perspective, like if I switch creative on Monday and it goes into learning for two days and then on Wednesday my MER is better or worse. I can use very micro attribution windows to figure out what's driving success. And especially for these DTC brands, UGC and Content Creative is everything. But the platforms are getting very smart. PMAX for Google Advantage plus, they're very, very smart. No human is going to outsmart them.
[Voiceover]: That's a positive way to end our conversation.
Adam Sharon-Zipser: I mean it's not all doom and gloom. Everyone is still making money and consumers are still spending. Hopefully inflation eases are not obviously rental leases and all these other macro factors. But it's hard to do, you know, economic commentary when you're an E comm manager or agency owner.
[Voiceover]: Yeah. And I think if Covid showed anything, we only see a fraction of the economic situation.
Adam Sharon-Zipser: Yeah. And there's like you're looking at a handful of customers that have discretionary spend because maybe the Gen Z's are living at home for longer. Maybe they're interested in viral TikTok brands. Maybe the spending dynamic is a little bit different. Maybe the spending is lifting at the upper end. Maybe the late 40s to early 50s. Maybe the boomers are buying more. Maybe the boomers are gifting more. I mean there's a lot of socks
[Voiceover]: going out the door.
Adam Sharon-Zipser: There's a lot of socks. And that's, I think that that Middle gap is probably getting smashed a bit, but I think on the either other side they're lifting everything else up.
[Voiceover]: Such great insights. Adam. It's been awesome. Speaking about gifting Gift Note and going into that little hole which I enjoyed around attribution and measurement and the challenges that I faced there was fantastic. You've got a lot on your plate. You're across a lot of different areas. Where are you focused over the next 12 months? What's exciting for you?
Adam Sharon-Zipser: What's exciting for me growing the team in both of them. I get a lot of fulfillment just from building and growing teams, building process and actually being able to offer my team a great opportunity to work and be involved with some awesome tech and just be surrounded by good brands. So that's like a big thing. We want to make sure that we're listening to customers on Gift Note and Elephant Room side. We really do feel like we've got a good read on market temperature across like CRM dev acquisition and tech and this whole general trifecta. So it's just making sure that their understanding, their profitability, their unit economics. We're trying to really support brands on dividing the CapEx and OpEx well and seeing what these investments are doing. But ultimately now everyone's getting a crunch. All the app vendors are getting smashed, everyone's negotiating harder. Every ecom manager is smashing everyone for a better deal and a better rate and I guess our duty in Gift Note and Elephant Room, if I was to draw a parallel and what the focus is is to prove value gift no focus as well on the retention side. Increasing LTV doing stuff like that. An elephant room isn't in a business to spend money for no reason. We want to make sure that what we're doing can actually draw a conclusion and we can paste this out over some of like over time with our key metrics and that's really where the focus is.
[Voiceover]: Yeah, that's a smart approach because there's been a lot of agencies that look good on the outside expand like crazy. But it actually the best agencies in my experience are the stable agencies that are profitable and have that retention of team.
Adam Sharon-Zipser: Yeah, we've always been a backyard business. We always focus on our backyard. We've considering we're almost 10 years like comparative to other businesses that have started with us, they're double or triple our size. We've always found refuge in partnerships, relationships and just like longevity and that's been very, very, very big thing for me.
[Voiceover]: Adam, if our listeners have heard this and they want to get in touch. They're interested in Gift Note, Interested in Elephant Room? Interested in yourself? What's the best way for them to get in touch?
Adam Sharon-Zipser: Usual socials work, LinkedIn? You can find me Adam Sharon Zipsa hellofnote.com Adamaphane.com Someone's always there. I'm always there. Don't get enough sleep so you're there for me.
[Voiceover]: Brilliant. Adam. Thank you so much for joining us on Add to Cart.
Adam Sharon-Zipser: Thanks for having me. Good to see you Nathan.
[Voiceover]: I swear it is purely coincidental that we have had Adam from Elephant Room Gift Mode and Gav from Disco Submarine almost back to back. But I am liking the trend of Australian e commerce agencies who are productizing some of their best ideas so that everyone can use it. It's a great trend now. If you are keen to give GiftNote a trial for your brand, Adam has a special offer for Add to cart listeners. Contact helloiftnote.com and mention the Add to Cart podcast to extend your trial and get support with any White Glove implementation. Very fancy. You'll be gifted noting away in no time. Alright, here are my top three takeaways from the episode. All right, Number one Customers spend more on gifts for others than they do on themselves. According to Adam, shoppers who are buying gifts for Others will spend 26% more average order value than if they were buying for themselves. This is obviously a big opportunity for growth for you to raise raise the size of that basket. And there's two things here. One, make sure your gifting process and options are up to scratch. Obviously things like Gift Note can help elevate that experience. And secondly, make sure you shout about your gifting options to prompt the additional spend. Some visitors may be shopping for themselves, but when you tell them that there is also gifting options, it may trigger trigger a second purchase. Number two Premium personalization. I loved the example that Adam gave from Dr. Doe Donuts who started charging for handwritten notes as an incremental service. Previously they were free, but they were able to shift the free option to Gift Note, which if we're honest is still better than most free gifting options. But Then start charging $5 for handwritten notes. This $5 covers the cost of Giftnote and introduces a new revenue stream. Very, very cluey. Definitely not doughy. Alright, number three Emerging analytics tools. Did you catch some of those analytics tools that Adam mentioned in the end? I haven't played with them, but it's always good to have a poke around with the emerging solutions. The two marketing mix modeling tools that Adam mentioned were Recast and Bimodal Bi Modal Bimodal is actually founded in Australia too, so well worth going to have a look and have a play if you are struggling to get your marketing mix modeling right. To get the highlights of today's episode, head on over to add to cart.com and sign up for our free newsletter each Tuesday. We will send Monday's episode summary links and discount codes for you to go next level on. And if you're looking to explore your next e commerce opportunity, come and Visit us at eSweet. We're a dedicated e commerce talent agency connecting the best e commerce talent with the fastest growing brands in Australia. Head on over to esweettalent.com where you can download the free e Commerce Salary Guide and sign up to our weekly ecommerce job emails. Thanks for listening and until next time, keep those customers adding the cartoon.
