How can brands use digital ads to drive brick-and-mortar sales?
Driving in-store sales requires different tactics than driving digital sales…
But with the right technique, you can grow your ROI and conversions…
Christopher Madden of Matchnode is here to share his expertise on digital marketing.
In this episode, Holly shares her content creation wisdom, including:
- How marketing leaders can facilitate an online/offline strategy
- Why QR codes are a popular way to convert prospects
- How to analyze if your campaign is working
- And more
Mentioned in this episode:
Voiceover: This is Performance Delivered, Insider Secrets for Digital Marketing Success with Steffen Horst and Dave Antil.
Steffen Horst: Welcome to the Performance Delivered Insider Secrets for Digital Marketing Success podcast, where we talk with marketing and agency executives and learn how they build successful businesses and their personal brand. I’m your host, Steffen Horst. The topic for today’s episode is how to use digital ads to drive brick-and-mortar sales. He to speak with me is Chris Madden, who is the co-founder of Matchnode an ROI focused internet marketing company that serves its clients in the areas of digital strategy, traffic generation and conversion optimization. Chris, welcome to the show.
Christopher Madden: Thank you so much for having me, Steffen. I’m excited to be here.
Steffen: Now, Chris, before we explore today’s topics, I want to learn more about you. Tell our listeners about how you got started with your career. And then what led you to founding Matchnode?
Christopher: Thank you for the question. So yeah, a little bit about me. I’m a career entrepreneur. I’ve been an entrepreneur for 20 plus years since I got out of university, and my early years of entrepreneurship, I have to be honest, and say that I treated them somewhat like an exercise. I was aware that I wanted to be an entrepreneur in my life. My parents were both entrepreneurs. And I definitely treated it as educational in my early 20s, which is to say that some of the businesses or all the businesses that I started, were great in what they taught me. And experience is what you get when you don’t get what you set out to get.
So none of them were massive financial successes, but what it did give me was a real foundation in a lot of different kinds of businesses. It also got me good at sales and marketing. And I did a few different things, including living in Costa Rica for a few years and doing sales there. Sales was a real core competency, technology and marketing were the three things I was always interested in. As I got back to the United States, and started doing some ad hoc work with some freelance clients, it turned into my agency and that my clients, became my co-founder whose name is Brian.
And I believe you’ve also spoken with Brian. And that takes us to where we are now that was nine years ago. We started Matchnode, before the first Pearl Jam concert at Wrigley Field in 2013. We decided, hey, we know each other we’ve been working on this for years and different constructs. Let’s start an agency. So that was on a Friday night. On Monday, we went to a co working place together. And we’ve been doing it ever since. The five years after we started, and this gets to the point of driving real-world brick-and-mortar conversions with digital ads.
That same venue Wrigley Field, the owners of the Chicago Cubs baseball team that plays there became our clients. And the flag from the concert we were at, that Pearl Jam night that when we started the business was behind glass like in a display in the meeting room where we were signing the contract. So we kind of looked at each other. And we gave each other a high five at the progress we made and shared the story with the client. So it was a winding entrepreneurial road. And I think a lot of it prepared me for what we do now.
Steffen: Nice, nice. Now, how is running digital ads to generate e-commerce sales or online leads different from driving in store sales?
Christopher: The main way that it’s different is the conversion that you’re going after. Meaning all the ads that we run for our clients are for specific purpose. Either to drive a sale to turn a person into an interested lead for business. Whatever it is that our client is aiming for, is the thing that we’re trying to drive with our ads. So we have a couple of e-commerce clients, we love it. And we have other clients that the conversion is fully online.
So when the conversion is fully online, you’re simply firing a pixel on the client’s website, say on the thank you page when someone checks out from buying the products. And then we’re able to see in the ad platforms that we track a conversion that the ad drove and that virtuous cycle of optimization can be very clean.
Now when the conversion is not on the internet, and it’s actually in real life, a point of sale system at a retail store or a restaurant, or when your goal is to get somebody to show up at an event, we have to get a bit more creative at what that real life conversion is and how we can get it back to the digital ad platform. So that’s the main difference is like where the conversion takes place. And it allows us to be very creative and figure out ways to get these real life conversions to automatically track back to an ad.
Steffen: Interesting. I mean, how do you get feedback from an offline conversion into your, into your online platform in order to optimize account? How do you, how do you focus the budget that the client gives you to create the most impact?
Christopher: Well, there are a few ways. And first is just generally testing. In order to have the most impact, we have to try different things and have different ideas where we’re continually improving on whatever success is that we have built. So in this case, the testing that you’re asking about that we’re talking about would be like, what is that conversion. What is an offline conversion that we can turn into a digital conversion. There is a very kind of manual process by which you can just take the conversion, the email addresses, or the phone numbers of the people who have checked out at your point of sale, your point of sale system.
If you’re say, selling shoes, you can literally take that list and upload it to Facebook and Google and see how many of those people saw an ad. Now that’s manual. And we do do that. But this is one of multiple ways that we will try to create a full picture of what’s going on. More to the point would be, this is back in the day now, like maybe seven or eight years ago, we had new balance as a client and some new balance stores in Chicago. And they had promo codes that were specific to the platform. So people would say I saw the ad on Facebook, therefore I get 15% off.
And that was a way for them to create a line item in their data that showed how much revenue was coming from the ads we were running. And when we started doing that, it was it was too much of a disconnect. We’re running ads on Facebook ads, trying to drive people into stores, it’s certainly gonna take days, if not weeks for people to actually go to the store. And then they just get the promo or mention the promo code. And our client three weeks later would say here’s the numbers. And at first, the numbers weren’t great.
So what we did there, and this is an example of creating a digital conversion was we put a landing page after the ad that said, if you want this 15% promo code, enter your email address and get the promo code. And that really helped. We got a really great case study around that story, and it really helps. Nowadays, again, that was seven years ago, nowadays with what’s happened with unfortunately, the pandemic, in the United States, generally, people were not using a lot of QR codes before the pandemic. Now everybody’s using QR codes.
And it’s still very common to go into a restaurant scan a QR code. That’s the type of thing that we can create a digital conversion for in in real life experience, that that we can fire by the QR code is simply opens a link on our clients, maybe restaurant website, and seeing that particular link as a sign to us that someone’s obviously in the location. So that’s another example. There’s a bunch more examples that I’d love to share in this conversation. But really, it’s using a lot of creativity on site in real life, to say, what is something digital that we can create in this experience that will fire back to the ad platform?
Steffen: Now, Chris, it sounds like the delay in response in regards to whether your activities drove an outcome is a main challenge for driving offline sales. Would you agree with that?
Christopher: It is to the extent that you don’t understand how long that lag is. And to the extent that you don’t have expectations aligned between your team and the client to make sure that that’s going to be understood. And that will be measured and understood that in way.
Steffen: Does that, does that also mean that you potentially need longer before you can determine what works and what doesn’t work? So the reason I’m asking is obviously, when you when you run activities that drive online conversions, whether it’s sales are leads, right, we usually get feedback immediately. You know there are some products, luxury products, cars, etc, where kind of the conversion cycle is much longer, but for many kind of fashion, etc, you get an immediate conversion.
It’s kind of a maybe seven days, window, right. So we don’t need so long to determine what works and what doesn’t work. We can then start to really hone in on on the parts of the campaign that we want to drive more. And the ones that we want to kind of, you know, scale back. How is that for when you really help brick-and-mortar stores? How long does it usually take before you guys can start optimizing campaigns? And how do you communicate that to the client that it will take potentially longer?
Christopher: Well, that last part of how to communicate that to the client has to start during the very first conversations we have with them before they’re our client. And part of what we want to understand is how open are they to those discussions. There’s certain big companies we’ve seen where, and they don’t have to just be big companies. I’m just giving an example where there’s a culture of say only last click conversion is the only thing that they’re going to consider or count. Well, we know that going in and we know that there’s not going to be much of a discussion about these more nuanced considerations of what’s actually driving these conversions.
So we are looking for those signals right away both like are they open to this? Will they understand it? Have they done this before? Sometimes they come to us with a very nuanced understanding of how long their conversion path is, and that that’s a challenge. And they might say something like, our CEO totally gets that. And we’re okay to invest, because we know that we’re going to look at this monthly. And we’re not going to look at these numbers every day. So we’re listening for that. And trying to get a sense is that in the client in the earliest discussions that we have.
And then how long is it usually, rolling back in your questions that you asked. It completely depends. Like you said, a week starts to get on the longer term, specifically, with some of the changes that have happened between Apple and Facebook with app tracking transparency, in the last couple of years. Those windows in which we can pass that data back gets more constrained. And there’s fewer devices for which that works well. But one of the keys that we found is, we tracked multiple, multiple conversions.
So certainly, we’re going to pick one particular conversion that we’re optimizing around, and one particular True North conversion when we’re talking to the client. But those are two different things sometimes. And the conversion that we start with, right at the beginning, like you said, we’re going to want to get some immediate feedback. We need to turn ads on and see within a couple of days, some signal of things are going in the right direction or not. So it might be like the case, I shared around the New Balance stores where there was that lag. And that lag was too long of a chasm for us where we just didn’t have any visibility on anything that was going on.
And so what we did was, we created that digital conversion, which was give us your email address. And that happened, of course, in real time, you know, seconds or minutes after someone might see an ad. And then we had to confirm, okay, are people who are giving the email address is actually showing up in the store. You know, there could be a digital conversion, that hurts your ultimate conversion. In this case, we found that it just greatly helped. Not only did we get these email addresses, but we also saw the numbers of people going in and redeeming at point of sale and buying things was increasing.
So similarly, we worked with a company called for eyes, which is eyeglasses, they had a digital conversion about telling, setting an appointment to come in to have your eyes examined. So depending on the business, there can be a natural way to get people to make a digital conversion happen. Give your email address and tell them you’re going to come, RSVP for the event. That then allows us to have both that real time faster digital conversion, but then we’re also tracking and can see and sometimes can switch the optimization, once we really understand how well things are working.
A test might be to switch the optimization to the in real life event and see if that improves things. So it’s a matter of testing, what we start with is not where we end. And it really is important to us that the marketing leaders that we’re working with at the companies are, you know, coming to us wanting to have that sort of nuanced discussion. And not that they’re, you know, someone on your team might have, or one of their bosses might have a closed mind to it. So it’s nuanced for sure.
Steffen: The last part really seems to me one of the most important parts, right? If the expectation is set properly in the beginning, and if you know that your client is, does understand that it’s not something that creates immediate response that is visible, you obviously set yourself up for success in the long run. Because otherwise, you have a client that sits there and gets impatient because they don’t get the data they might be used to from their online activities. And you might have just set yourself up for failure from the beginning.
Christopher: Absolutely. And that is so important for us to listen to early on. That would be an example of someone that might not be a good client for us. If we can hear that they’re not interested in that. If we have to convince them of these things, the earliest discussions is usually not going to go super well. Sometimes, like I mentioned that they’re coming to us, and they know that this is the challenge. And they say again, our leadership understands this as an investment. And they understand it’s going to take weeks, not days. So those are those sorts of things are very clear signals to us that that we might be in a place to really move the needle.
Steffen: Do you set these campaigns up differently when you’re focusing on offline sales? Or is it pretty much the same as you would set up campaigns for online conversions?
Christopher: Well, there’s some nuance in the setup being different when you just choose the different conversion. In meta ads manager, there’s sometimes a different flow, and sometimes different ad formats and things that are details differences in the way an ad might look or how it’s set up. Those platforms, ie the ad platforms, Google and meta change so quickly, that that detail, to me is less important than the idea that really what we’re trying to do with any ad and if you’re an advertiser or a business that wants to run ads through really just drive impact for your business, that you can be creative in what the conversion is.
And really, we step back from things like ad setup, which are important, but they’re details and we have people on our team that are experts in understanding those details in real time. But what’s really important is, can we create a conversion, that gets very close to proving that this ad led to a person spending money in your location. And we are oftentimes less concerned with what that conversion is, as long as it shows us that someone’s in person, saw an ad and showed up. And then of course, we would love things like being able to see how much money they spent.
We work with restaurant groups, and there are some restaurant back end reservation systems that really just don’t play nicely. For instance, Open Table. When we see a restaurant group that uses Open Table, we’re not as excited as the restaurant group that uses another platform called Seven Rooms. Because we know that Seven Rooms, plays extremely nicely in that, we’ll be able to run an ad to a landing page that Seven Rooms is creating for our restaurant client. And that when that customer goes and dines at our client’s restaurant, that all that information is tracked, including how much money they spent, so we can get like real ROI.
And that’s a perfect example of your question about how long is the lag? And what I’d ask you is how long do you usually make dinner reservations before you go out to dinner? You know? So that’s really like a consumer psychology question. It depends on the experience. So let me get my eyes checked, I might do like the next available time. It might be next week, it might be tomorrow. Similarly, with dinner, maybe if it’s just, so if our restaurant clients are higher end, and more expensive, and they might be special occasions.
So maybe it’s a week or two. Certainly more than a month, we’re not going to be able to connect that back to the ad. And so we would definitely have to have some sort of a digital conversion that’s getting us, you know, far along that journey in that case. But anything that’s a week or even two weeks, I think works really well for this.
Steffen: Now, have you seen industries where this driving offline sales of brick and mortar sales from online activities works better?
Christopher: Yeah, I mean, like I just mentioned restaurants. And with the right system, meaning a point of sale system, that and the restaurant that integrates with your database of customers and people who make reservations to show up to your restaurant, that can work extremely nicely. But then if they don’t have that system, it really gets difficult. In the again, those are maybe higher end more expensive restaurants. It used to be that restaurants on the lower end, not on the lower end, I shouldn’t say. I just mean like a lunch restaurant with no alcohol.
So the check average might be $10, like a quick service restaurant, rather than a fine dining restaurant with alcohol, where it might be more like $50 a person. So a $10 a person restaurant, quick service restaurant, traditionally have been challenging for us to do this with. And we’ve tried it. We’ve had clients in the space. And it was just kind of mixed reviews, it was also COVID. So there are a lot of challenges going on with those sorts of restaurants. But that’s where the, that’s where the QR code thing came in. All of a sudden, we just had this aha moment of like, oh, the QR code.
Now, we can set a very specific URL that that QR code will open. And that is our digital conversion, that shows that someone’s in the store because they only see that QR code in the store. So for restaurants, it depends on the type of restaurant and what systems they’re using. I mentioned more retail focus. So New Balance is of course a shoe business and we’re trying to sell shoes in the store. We know that that of course you can buy New Balance sheets online, we’re actively trying to avoid online sales, and only trying to avoid we’re only trying to drive in person sales in their stores. The other one that I mentioned was For Eyes.
And so for For Eyes, that’s, that’s a retail eyeglass an eye doctor business. And what really worked well in their case was people are used to making appointments for eye exams. And so that digital conversion that can happen again, minutes or seconds after they see an ad, really was a big unlock there. And then we can see, okay, this led, this ad led to this person making an appointment to go in on Tuesday. Are they showing up on Tuesday? And pretty quickly, we knew what percentage of people would show up and then of those that show up what percentage of people would buy. In fact, the business already had those numbers.
So all we had to do is just be sure that our ads were performing as well and around the baseline. So that’s retail for eyeglasses, like medical, like healthcare, shoe retailers, restaurants. There are some, I would say just pure event, like free events can be kind of hard to track people. You need, you need something somewhere where they are buying something or using like connecting to Wi-Fi. So we worked with Gallagher Way, which is a large entertainment district outside of Wrigley Field.
And so they have bars and restaurants and events. And there’s a campus-wide Wi-Fi, and any you know, for free people who are there, because they’re seeing a concert or doing yoga or shopping can connect to the Wi-Fi. And similarly to the QR code example, connecting to the Wi-Fi opened up a specific page where you just have to say, yes, I want to connect and click connect, and that became our digital conversion.
So that’s a wide array of businesses. And the ones that it doesn’t work as well for would be the ones like you mentioned that maybe have a really long lag between the time when people show up, and when they might make plans to show up. And then also any situation where we can’t think of some sort of a digital interaction that might be happening.
Steffen: Interesting. Now, you earlier talked about how important it is to kind of get the buy-in from, from the leaders at brands that you engage with. Is there anything else that that marketing leaders at brands need to do to facilitate this online to offline strategy?
Christopher: Yeah, certainly the choice of systems is the thing that, like I said, when a client hires us, the systems are already in place, you know, almost all the time. And so we’re asking them, okay, what is your system? What is your CRM? How does your business work behind the scenes? And there can be choices that, that marketing leaders or non-marketing leaders in the business make that make this work, either extremely smooth, or extremely challenging.
And I just know situations from our clients where, you know, the CEO of the business happens to be at a trade show, and he meets a vendor, and he likes the vendor. And that’s why they buy that particular software, even though that particular software is not the one that plays well with all the systems that we need to connect. So I’d say systems choice is an important one for leaders at businesses who want to try this sort of online to offline strategy.
And then as you’ve referred to a couple of times, I’d say, expectation setting within the leadership throughout the business to understand how this works, and that this is not the same thing as turn ads on, like, let’s see how it did tomorrow, or in two days. It’s a little bit of a longer time horizon. So I think thinking through that, and understanding that it’s important for other business leaders or marketing leaders in the same business.
And then the third thing I would say was, it’s always important to consider how these different marketing channels for our clients, it’s very rarely that the work we’re doing or that paid social, for example, would be the only marketing spend, that they have, or marketing activities that they have. And so we do really try to understand how our activities integrate and overlap with and maybe the same person, of course, might have seen multiple marketing activities. So how do those things fit together?
And so having a nuanced discussion, that we don’t have to do it every week, you know, of course, we want to have True North metrics that we can very quickly say this is this was a good week, or this was not a good week. But being able to have that more nuanced discussion of all of our clients, customers are relatively busy in their life. And there’s a lot of things coming out all of us. So just understanding that these marketing efforts are taking place in that context in people’s lives, and that it might take a few days. And so yeah, I think the expectation setting is a big piece.
Steffen: Now should brands that listen to this and think, hey, you know what, I need to talk to Chris, how should they think about your service? Is your service, kind of a performance focused solution, that at the end of the day, is about driving sales? Or is it more, you know, growing awareness and consideration and then as an add-on, we drive people in the store.
Christopher: Yeah, it’s definitely the first one which is we’re here to drive sales, and we are measured on ROI. And kind of as an add-on, you get impressions and awareness. So we are definitely, brands should definitely think of us as, okay, we’re gonna put $1,000 or $10,000 or $100,000 into this channel, how much are we gonna get out.
And that’s why that’s why those nuanced understandings of attribution and how different channels are working together and what’s really going on in the customer journey are so important to have because that is how we at Matchnode are graded when those numbers go very well and the relationship goes well, that’s how our business works. So yeah, I think brands should think of it as you know, a test and we can make a short-term test to prove the numbers and then we build long term relationships off of that. But it’s always about ROI for us.
Steffen: Are you able to achieve similar ROIs than that of online advertising that really sells products online or generate leads online? Or are the return on advertising or return on investments in general lower?
Christopher: We’ve seen them be very similar. Now, it’s a little harder to track. So again, we do have to have a little more nuanced, in how we’re putting all these numbers together and deciding, you know, what the best, I don’t wanna say, estimate, but what the best number is for any particular performance. So, you know, every business is different. For instance, if you’re New Balance you’re selling shoes. There’s a lot of fixed costs in the shoes.
So if someone’s spending $100, in a New Balance store, and we know say $50 of that is literally just the cost of the product, how much they can spend on ads to bring that $100 transaction in the door, might be really different than For Eyes giving an eye exam. Because you know, they have fixed costs in their stores and the employees in the stores. But if it’s just an open slot, having somebody in that eye exam, in that eye exam open space, unused inventory, essentially, is a different consideration. As far as what you what percentage of that revenue do you want to pay in advertising than a pair of shoes that has a fixed cost.
So even within the brick-and-mortar space, what a company might be willing to pay, or what we might expect, or what we might have as a goal for the return on ad spend is very different. I would say, though, that that’s more of a factor, then is it online, or is it offline. We’ve run online ads for brands that did not go as well for various reasons in the way their business was positioned or built. And then we’ve run in real life or brick and, you know up online to offline online ads to brick and mortar, what we’re discussing here that you know, have had a 10 ROAS.
So it really is more about the business and what they’re selling and what they can afford to spend in their unit economics on advertising than it is online or offline. So we’ve seen absolutely similar performance. And there have been cases where the offline business does better than the online business and vice versa.
Steffen: Do you consider lifetime value for these campaigns as well?
Christopher: Yeah, we do. We’d love to talk about lifetime value. And we do, of course, consider it. And it’s another thing that completely depends on the business. Certainly, in almost every case, we’re considering and being asked to segment new customers from returning customers. Assuming it’s a business that’s relevant. You know, we don’t have any mattress clients. But if you have a mattress client, people don’t buy the mattresses that frequently. So you really just want to find new people.
So all of our clients pretty much are interested in is this a new customer for us? Or is this an existing customer that we’ve already marketed to that we already have a relationship with? And those two groups are often treated differently, as far as what they want the target return on ad spend to be for those two groups. It’s very rough way of getting to the issue you’re asking about.
And, you know, I mean, I think that the lifetime value question is hugely important, especially for those businesses that have tight margins, or, like know that they can’t make money on the very first transaction. I would say all of our clients almost without exception that we’ve been talking about so far today, they want to run ads, that that in the next transaction with that person, whether it’s their first transaction or their 10th transaction with that customer will make money immediately. So when I say three to one or four to one or a 10 ROAS that really is just considering that next transaction.
We’ve seen businesses, and we don’t have that many of them, but we’ve seen businesses where, you know, they know that they’re going to lose a little bit of money on the first transaction. But their average customer buys three times and therefore they’re willing to take that loss on the first transaction. That hasn’t really been asked. It’s a little bit of an e-commerce playbook, I think, or like a certainly subscription playbook. And we’re much more about established brands that are shifting to digital.
So A they’re comfortable making the investments and understand like in the ways we’ve described that sometimes parts of this is investment, but to learn more about the future. But really, I would say that the numbers have to bear out in the short term. Meaning month over month, over a 90 day period. That’s what we’re looking at. Lifetime value would be like a separate strategic discussion we might have where we say hey, there’s a four ROAS and these are all new clients.
So we know some of them are going to come back. We’re not necessarily counting that unless the client would ask us to or or say that they want to do a win back campaign or like, hey, we know that there’s all these people that haven’t come back. And we think they should come back every 90 days or whatever. We could set up a campaign that answers to that. But I think lifetime value is kind of for us a more strategic discussion that is important. But we really are measuring ROI in like, the last ad you saw versus the next transaction you have.
Steffen: Chris, a great conversation. Thank you so much for joining me on the Performance Delivered podcast and sharing knowledge on driving, driving offline sales through online activities. How can people get in touch if they want to learn more about you, or Matchnode?
Christopher: Get in touch by going to matchnode.com. If you’re interested in these exact topics, I would flip right over to our case studies page. There’s some case studies about exactly this, including the New Balance one I’ve been talking about. And please reach out on the website. If you want to talk more, we’d be happy to. Steffen, I really appreciate you having us, I really enjoyed, having me. I really enjoyed this conversation.
Steffen: Perfect. Well, thanks everyone for listening. If you like the Performance Delivered podcast, please subscribe to us and leave us a review on iTunes or your favorite podcast application. If you want to find out more about Symphonic Digital, you can visit us at symphonicdigital.com or follow us on Twitter at Symphonic HQ. Thanks again and see you next time.
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