The eCommerce Marketing Podcast walks you through everything that goes into ecommerce marketing — from inbound marketing to paid advertising to conversions. Learn the strategies top marketing experts use to grow their businesses.
Marketing Strategies and Topics Covered in this Episode:
Welcome to the e-commerce marketing podcast. Everyone. I am your host Arlen Robinson. And today we have a very special guest Andrew Warner, who is a virtual CFO for marketing agencies and e-commerce stores. His unique mix of experience in both finance and marketing allows him to approach how he helps the companies he works with in a unique way – helping them get a better handle on their numbers while not forgetting marketing best practices.
Welcome to the podcast, Andrew. Hey, thanks for having me on. Yeah, no problem. Really excited to talk to you because you know, today we’re going to talk about finance and marketing and all those good things. You know, a lot of times with e-commerce businesses, of course, on this podcast, our focus is all about marketing, but if you don’t have your finances together, there’s no such thing as marketing. You can’t do anything.
So that’s ultimately the bottom line. And I know you deal with this day in and day out helping, you know, e-commerce businesses because, you know, ultimately you really, your business will really become stagnant if you don’t have your finances in order. So, you know, we’re going to talk a little bit about, you know, using data, you know, that you get within your business where as far as not only making marketing decisions, but financial decisions as well, and you know, really how to put best practices and, and some of the main business principles into play to really help your business grow. But, you know, before we get into all of that, why don’t you tell us a little bit more about your background and, you know, specifically how you did get into what you’re doing?
Sure. So I had an interesting journey. So I started out originally in the Binance Binance world, working as a CPA and working for accounting firms, but I decided I wanted to leave that world to move into the digital marketing space. I had a dropshipping store on the side and was starting to help some people with some digital marketing campaigns and launching Kickstarters and a few things like that. So I kind of moved to that world thinking I was leaving the financial world behind, but the longer that I worked on being a digital marketing consultant, I just kept getting pulled into the finance side. You know, the inventory management issues, if the marketing campaign didn’t too well or cashflow or similar reasons, but also helping people to understand where to budget their marketing spend and what that looks like or the overall focus. And so I ended up eventually just accepting it and deciding, all right, I’m going to go back to the finance world, help business owners from that perspective, but with a solid understanding of marketing and how it all integrates together.
All right. That sounds good. Great, great stuff. So I guess it’d be, you know, you just couldn’t, it started off as a CFO started off in the financial industry and it just seems like he couldn’t couldn’t escape it, you know, that was really, you know, where things were at as far as your expertise and, you know, it is good to know that you’re able to utilize that expertise to specifically, you know, see how that can help e-commerce businesses, you know, for sure. And I, and I know nowadays more than ever because of everything that’s happened in the world the past year and a half or so, or a year and a few months with the entire pandemic that we’re facing, you know, this has been a, such an influx of businesses focusing online. If they didn’t have an online e-commerce presence where there was selling their products and services, they damn sure do now.
So yeah, you know, been approached by a lot of businesses that have been scrambling to try to make it work, but you know, really what I want to, where, where I want to start our conversation today is really just going to be about accounting tasks related to e-commerce and really when it comes to counting, you know, it’s a, it’s a huge subject. There’s a lot of things that you can focus on as far as reporting is concerned, but really what are, what are some of the main important accounting tasks that you recommend e-commerce businesses keep track of and, and really keep their, their hands around?
Sure. So I do think that accounting and bookkeeping is really important, but I’m actually, I’m going to change the question just a little bit and maybe focus on broader finance tasks for e-commerce because it used to be most of the e-commerce companies I work with, they’ve got a lot of the bookkeeping figured out. Maybe they’re not looking at it as often as they need to, or updating it as often as they should, but they have a general path forward there. What I think is boasts like the most potential for growth for most eCommerce businesses is focusing more on forecasting, maybe even budgeting. Although that sounds a lot of times I talked to the business centers have that budgeted before they kind of get stressed out. Budgeting sounds very eliminated, but I really look at it as how are you going to reach your goals? So we really try to focus on that.
And you know, there’s a lot of times when you’re in the e-commerce world where you need to know there’s all these different metrics that are constantly moving and interacting with each other. But if you can see, all right, if I’m able to hit this traffic, this conversion rate, this price point, what’s my revenue going to be. And then from there, what’s my profit going to be, and maybe run some scenario planning and also run that against kind of comparing the profitability, the cashflow, and even like your inventory levels, if that’s something you have to worry about. So I found that to be the biggest unlock, if somebody really focuses on that, they’ll get a lot of a return on
That makes a lot of sense. Like you said, as opposed to just specific accounting tasks as an e-commerce business, you got to really kind of look at the big picture and with those few things, as far as inventory, that’s a huge thing, you know, here at OSI affiliate software, we deal with e-commerce businesses day in and day out. And I know from looking at kind of the back end and the guts of a lot of online stores, I see that that’s like, it can be very, a very challenging issue with inventory. Knowing from month to month or quarter to quarter, what do you need to have on hand? What do you forecast for future periods of time for holidays, that type of thing, you know, if you spend too much and you have too much inventory on hand, then you know, you burnt cash. And so it, it is an interesting game.
So your inventory is a huge one. And then of course budgeting as well. Because if we’re looking at, let’s say marketing, I see this as something that I know a lot of businesses struggle with, they know that they have to do of course, a fair amount of marketing to get their business out there, to get some brand recognition. But a lot of times it can be somewhat of a guessing game unless you have a specific budget in mind for these types of tasks. A lot of times I think businesses tend to try to kind of throw money haphazardly at various marketing tasks and other tasks in general, and with not really a plan or a cap on that spending. And then I think that’s how a lot of times you can get into trouble if you don’t set those things up. Initially what I was going to ask me, you know, what specific advice where we, if we look back at the, at the budgeting where if you’re looking at a typical e-commerce business, let’s just say they’re stealing, selling direct to consumer just from their website. Mainly when we’re looking at a budgeting, is there like a general rule of thumb when you’re trying to come up with a budget for across the board for everything
I can tell you, there’s actually not a general rule. Most, I think that most e-commerce owners feel like accounting really isn’t that helpful to them and I’d agree. Yeah, because it’s very past focused and it was built for a world where it was built for Benicia merchants in the 13th century. And it’s an updated view of time since you have your manufacturing company, your financial statements and everything served me really well, but the commerce companies I work with there, there’s a big gap and they really, really need a lot more than what accounting would provide, what I typically do. And you can almost do this initially on an app later on, if you want to build better tools, track this monthly and, you know, have different software tools you’re using to do this. But I think initially, just so that you don’t get too overwhelmed, even just building it out, something simple where maybe you’re saying, let’s say for an e-commerce company, like you’re, you’re saying you would have maybe your traffic.
Okay. What, what’s the goal for our traffic? And then what would we need to convert that traffic app? And then you can say, okay, based on, you know, we’re kind of getting eyeballs to our science for converting those eyeballs to customers, and then maybe you’re even asking, okay, what about the orders? If we can get an AOB of this rate, maybe that involves raising prices or getting more units sold per order, but you can do all that. And that gets you to the revenue number. And most of the modality, you know, if you look at the income statement, revenues, just line one, I think all of us as marketers know that there’s a lot that happens before that. And I think that that’s maybe the best way to start is to set some goals down there. And then that way you don’t hit your revenue goal, you can say, okay, where was I off? Cause I often the traffic from what I thought originally, or the version rate or we’re having some AOV issues. So I think that just isolating, those can be a great way to get started with the budgeting.
Yeah. That’s, that’s good to know. You know, it is as simple as just tracking things like, like you said, on a napkin, for sure. You know, just somebody, some basic numbers, but of course, as a business grows, as they have more revenue coming in, more profit, get a little bit more complicated than that. With regards to tracking these things, what are some typical or some tools or resources that you recommend to, to help accomplish these tasks as far as the forecasting, the budgeting, the invoice inventory tracking and that type of thing.
Yeah. So I think that a lot of traditional bookkeeping software is definitely a match. Do you have to have QuickBooks or zero or something like that, just so that those numbers are easy for you to pull out in terms of the best software to track this. I’ve tried a few different things and most companies that I know they’re on the smaller scale you may want to track and Excel. Maybe it’s a little bit manual than when you’re first starting out. That may be the best way you just need to be in the habit of pulling it down and doing it as you scale. And this is really more become more and more. My focus is helping consolidate a lot of data because there’s so much marketing data out there. And actually bill, this gets a little bit more advanced, but building like custom SQL databases and then visualizations on top of that and trying to get to where you almost have like a financial planning analytics platform built out. But to be honest, I’ve almost gotten to the point. I tried so many different softwares to do that. And eventually I have a data scientist on my team. And so we just kind of built something custom for that. And that may be a route that could be interesting to people to try to hire somebody with a little bit of programming background or data background to put that together or find a consultant that can help you with that.
Yeah. Good stuff. It’s these days it’s, it’s kinda wide open as to what you can do, just because the access that we now have to all of these tools at a very bare level base level. Yeah, of course you can definitely use just Excel to track some of the basic things. They definitely do that. Of course you need QuickBooks and things like that. But yeah, some of the other tools, you know, that there’s really a lot out there and that’s the thing, even if you don’t have need to have something customized for your specific situation, you know, there are these days we’re kind of in like a freelance heaven because there’s so many people out here that do freelance work that you can get tap into and have them maybe create something specific for you using, you know, SQL and whatever your needs are. So really the, the options are really limitless these days, you know,
For sure. And also on top of that, there’s so many software like yours, for example, that’s tracking all this data for you and gathering it for you and making it easy to use. And if you could just have somebody that helps you put a little bit of that data to use and kind of combine it with the finance side of things as well. I think that that can be really helpful. And we’ve, we’ve found that there’s a lot of, bit of this when you combine that marketing analytics side with the financial analytics as well.
Yeah, very true. And a lot of times, if you’re using different solutions for the, for the marketing and then the force of the financial stuff, these days, whatever you’re using, there’s, it’s a lot easier to tie stuff together these days because we have, there’s so many tools out here like Zapier for one that can be used to create an interface between different software solutions. That’s just one there’s, there’s actually many others. I know there’s another one called a integral mat that can help you basically tie spreadsheets or Google sheets into other solutions. You name it, you know, it’s there, they’re out there. So these days we’re definitely blessed to be in a situation where even though you may need a program or a developer to kind of do some of this work for you, it is not as easy as, excuse me. It’s not as difficult as it once used to be.
I know before, you know, when we started our business back in 2000, anytime you were trying to tie two solutions together. Yeah. I mean, it was a straight custom development job, you know, it’s like hours upon hours of development to try and get two different solutions to talk to each other and communicate yet to review some pretty super techie API documentation on both ends and then figure out how to get stuff to talk together. And a lot of times it didn’t really work. Wasn’t supported by the app companies. And so it was a huge thing, but these days, software developers are not on the software developers or app companies know that their customers are going to need to be able to get their information or get the data that’s in their solutions to be able to talk to other solutions. And so they’re mindful of that.
And so that’s why upfront, I think these days I’ve seen with most app companies, they do a pretty good job of allowing you to tie things together with pretty detailed API documentation or being compatible with some of those other third party tie in solutions like Zapier or integral mat. So yeah, definitely I we’re benefiting from, from the progress that’s been made for sure. Now we want to kind of ask you about is really what are some challenges and really just the, you know, from what you’ve seen with e-commerce businesses, as they’re growing, you know, from startup to wherever they’re at their maturity level, what are some challenges and success factors, as far as balancing all of this out, balancing this financial data with this kind of ever changing world we’re in, as far as, you know, fluctuating sales, maybe due to a pandemic, or maybe you get a decline in sales, what are some things that can be done, I guess you can say to kind of help businesses really stay on top of these changing times, I guess is I guess what I’m asking.
I talk a lot about what I would call third millennium business principles and the focus there’s kind of all right, these are new, you know, we’re kind of just starting the third millennium, but they’re hopefully going to be timeless too. It’s not something that’s, you know, a Facebook ad strategy that’s going to disappear next week. You know, one of those is a feedback loop. And I think that if you really study different aspects of finance business management, the feedback loop is getting more and more important. And I think maybe here’s like a helpful analogy that I use to explain things to my clients. There’s so much data out there. That’s kind of something we were talking about before with the marketing data, the financial data operational data, but you need a way to consolidate that. And almost if data is the oil and our new economy, what you really need is petroleum.
You need to have a way to break that data down and say, okay, we’re going to be looking at these metrics. And when this changes, we need to let people know. And from there, you know, that could be through dashboards, but also like you talked about with Xavier upset things up before where there’s a change in conversion rate for a particular product can trigger an automatic event in a sauna for somebody to look into it and different things like that. But that makes it to where, you know, you’ve kind of refine that data, you know, in the oil and my original analogy into petroleum, which you can actually use to fuel your car and other things. And I think the other piece that kind of works with that as well as you still need the engine, which is the team in place, maybe the eSuite keys for what to do when the data changes.
But when I talk to people, I normally am able to quickly figure out if they’re, if they don’t have enough data at hand with just kind of an oil issue, if they’re not really refining it, well, maybe that’s a dashboard and kind of like automatic follow up type issue. Or as of that, they aren’t doing a good job with putting when they they’re finding things in their business that need to change having a system to actually make those changes without calling them an engine issue. That’s go the analogy that I’ve been using. And it’s kind of helps me to, to think all that through.
That’s really good. Yeah. I think what you have to think about with, with all of these things is just, you want to do some things that aren’t going to be obsolete, you know, with changing times, you want to do some things that you’ll be able to pivot with easily, no matter what’s going on in the future. And that’s kind of really something that I think businesses have to think about in all aspects of their business, just, you know, the future, what are they doing today? Is this going to be practical next year, next month, or even next week? The thing, you know, the way things are changing right now. So yeah, very, they have to be very mindful of that for sure. You know, as we get ready to wrap things up, I would want to ask you is really what, what are some companies or businesses that you’re familiar with that have done a great job managing their accounting tasks for specific accounting tasks for e-commerce and what are some of the specific things that they have done? You know, the accounting or financial tasks in general?
Yeah. So, you know, I have a lot of clients I work with. I probably won’t go into too much detail. There are student client confidentiality. I think the best example, though, the best kind of almost like the ideal business is doing all this well would be Ray Dalio’s company Bridgewater. He wrote a book called principles and he in the eighties was doing this. He was saying, all right, what’s our principles and what are we going to do if this data changes? Like what, what’s our standard principle for how to deal with that. And he spent a lot of time getting all that renown and backward. It was a lot harder to consolidate all this data and make those automated decisions. He was doing a lot of that in the 1980s and has continued doing that ever since and reap the rewards. You look at how much they’ve grown and everything else.
I think that’s probably the best example, but you know, I think, I think there’s other people that are clients that I’ve seen, you know, when they, when they really fully implement dashboards and then setting up feedback loops. So we’re, here’s the systems we’re going to do. And the numbers change in these certain ways, very similar to how Ray Dalio has with principals. I think that’s really, when you see the most benefit from your accounting, because having the accounting data there is useful, but having it where you’re able to convert that into action, I think that’s just priceless. And then when you integrate the marketing analytics into that same framework and that operational analytics, it just gets even better. So that’s what I would recommend everybody, if you’re only going do one thing from this fall, that would be the main thing I’d focus on.
Yeah, definitely great advice. You know, it really comes down to making data-driven decisions, no matter what it is that you’re gonna, you know, make it a decision on it. As long as it’s based on solid data, then, you know, a lot of times you can’t go wrong, you know, as opposed to making decisions off the, off the cuff, you know, that’s, that’s when I think a lot of businesses fall into traps and they’re not looking at their company data for sure. Well, yeah, that’s great advice, Andrew. Thank you for sharing that. And definitely thank you for, for joining us today. I’ve definitely learned a lot. I appreciate you coming on. I know our listeners have as well. I, and one of the things I always like to end up with is just to kind of my final fun fact question. If you don’t mind sharing with us, what is one closing fun fact that you think our audience would be interested to know about?
That’s interesting. So I, you know, I’m smart. I would have thought of something that’s, you know, accounting and finance and really relevant to our conversation. But for some reason, the best fun fact I can think of is that I’m actually related to the original naked cowboy, if you’re familiar in times square in New York. So he’s, he’s actually, but there, if it’s about third or fourth cousin, but I found that out the other day. And so I’m, I missed my calling.
Okay. Do you play the guitar or you musically?
Well, not well not, well, you wouldn’t have to listen to me for sure.
Gotcha. Gotcha. All right. Great. Well, that’s, that’s a good fun fact. Yeah, I do remember I was in, I dunno, is that guy, is he still around doing that stuff in times square, the naked cowboy in his, in his, in his underwear.
So from what I’ve heard, and I’m not a hundred percent positive about all of this, but it sounds like you may have like a brand and people that are kind of under him now that are kind of the dude. They could delve boys because he’s been doing it for awhile. So, wow. Yeah. He’s got to scaling that up to some extent
That’s good stuff. I’m glad he was able to really kind of leverage that. Yeah. I do remember going to New York, this was probably well mid, mid 2000 early two thousands. And I remember seeing, I got, I think I took one of those bus tours in New York and I remember seeing head times where I was like, okay. So yeah, it’s good to know that he’s was able to leverage that, you know, attention into, you know, some success after that. So it was good. Good stuff. Interesting.
Maybe we should start looking into affiliates or something like that.
Exactly, exactly. For sure. I may have to look him up. All right. Well, sounds good, Andrew, thank you for sharing that. We appreciate it. And lastly, of course, if any of our, want to get ahold of you and pick your brain anymore about accounting and finance and marketing for their e-commerce business, what is the best way for them to reach you?
Sure. So our website is marketing cfo.com and just feel free to schedule a meeting on the, there should be a link there. So feel free to reach out there and that’ll connect to my calendar and we’ll be able to chat very soon.
Okay. Great. All right. Well that sounds good. Thank you for sharing that, Andrew. We appreciate it. I definitely encourage people to everyone to reach out to you check out your, your guys’ website and yeah, we’ll just go from there. Thanks again for joining us today on the e-commerce marketing podcast. Thanks for
Thank you for listening to the e-commerce marketing podcast.
Founder of Marketing CFO
Marketing Strategies and Topics Covered in this Episode: