Growing Your E-Commerce Business Using YouTube with Chris Hoppe

00:00 Andy Splichal Welcome to the Make Each Click Count podcast. This is your host, Andy Splical. We are happy to welcome this week's guest to discuss today's topic, which is growing your e-commerce business using YouTube. Today's guest is a YouTube expert using YouTube. He has created over 20 million in e-commerce revenue and over 100,000 leads. He has made YouTube ads, the number one acquisition channel for several DTC e-commerce businesses. A big welcome to Chris Hoppe. Hi, Chris.

00:29 Christian Hoppe Hi, Andy. Very good to have you to be here.

00:33 Andy Splichal Thank you so much. Yeah, we're excited to have you and excited to talk about YouTube. So e-commerce companies, they are always looking for new marketing channels that can drive new traffic at profitable levels. But given that, I'm curious, what makes YouTube untapped by so many retailers, do you think?

00:51 Christian Hoppe That's a very good question. I think historically, many e-commerce brands have grown with meta ads and it's been the predominant channel. And we've seen a very big shift when iOS hit in 2021, when it was the first time when e-commerce started to think, okay, maybe we wanna diversify, maybe it would be good to have other acquisition channels. And that's also when I was still working at the DTC brand and when we started exploring different channels and started to think, what is a channel that has scale? And YouTube was definitely is one of the largest social media networks. And so we went into YouTube, but still I think it's undiscovered because it's very, very hard to make YouTube work for e-commerce.

What makes it hard to make it work?

That's a good question. So I think our experience was when we started with YouTube ads that we burned 100,000 euros, $100,000 and didn't get any return. We worked with five people at Google video specialists and everyone, but still we didn't get any returns. We got like 30% brand lift and Google told us that's a great result, but we said, where's the revenue? And I think that's something I hear a lot from brands to say we tried YouTube and it didn't work. And for us, it took us a year to experiment. We just said, okay, we don't wanna give up on YouTube. We believe it can also work for e-commerce. And we tested a lot. And we basically found that there's not only media buying side, but also the creative side that needs to be done right to make YouTube actually work. So there's a lot of pieces and puzzles that all need to fit together. And there was nothing on the market when we started that really gave us this kind of formula, this concept, how to scale with YouTube.

02:39 Andy Splichal So are there specific ads that you need if you want to actually drive revenue opposed to just getting more brand recognition?

02:49 Christian Hoppe Yeah, so we still work with YouTube long form, right? Now there's a lot of talks about YouTube shorts, but YouTube still has not shifted much to shorts, especially with ads. So it's a very specific format. It's like one and a half to three minutes, which is very different, right? If you think about any other platform, one and a half to three minutes, I think is not the norm for other platforms. But what it gives you is the opportunity if you structure the creative in the right way, that I always say like, you can put the landing page into a video, right? So you can put a lot of things that usually readers would read on the landing page, would walk through on the landing page, you can already put in the ad. And if you do it right from a structural perspective, what we see is then the quality of the traffic that we actually drive to the website is a very high quality. So we see like even 1500% higher ever session durations, pages per session, and also conversions on the website, because they are already pre-qualified and have a lot of the information already in the video when they come to the website.

03:57 Andy Splichal So how are you having videos filmed? I mean, is it somebody just doing it with their phone, talking into it? Are they professionally done? Yeah. I mean, what kind of videos produce the best?

04:10 Christian Hoppe So we tried everything. We tried kind of TV productions almost. We spent 50,000 on a video production and we spent almost nothing. And we basically had the same concept filmed once with a $2,500 production and then 50K. And actually 2.5 worked better. So it's not necessarily about the quality. Too high quality, same as everywhere, can just come across as an ad, as a TV commercial and that's not helpful. So it's surprising that sometimes even voiceover ads you just take existing material and put voiceovers over it, but with the right structure can work much better than some professionally filmed ads.

04:54 Andy Splichal So if an advertiser out there is listing somebody who owns an e-commerce and they wanted to try launching a couple of YouTube ads, where would they start?

05:06 Christian Hoppe We always start with the research, right? Because we think we hear a lot, we tried YouTube ads that didn't work. And I always ask what didn't work, right? And so what we find is that sometimes you believe customers buy because of a specific reason, but in YouTube more than anywhere else, you really need to understand what is the reason because you put a lot more content into this one and a half, three minutes. So we do a lot of research, go and scrape reviews, see what people write about the product, but also go to competitor websites, check out what people write about the competitor products, or just in general, how the competitors position themselves. We have basically a list of 20 things we do in terms of research to then put that into different modules. So we have one core video creative, but test different hooks, similar to other platforms to really see what works. So I strongly recommend to really put in the effort in the beginning, same as on other platforms, but even more on YouTube to find out then what works in terms of messaging.

06:11 Andy Splichal So once you have your messaging done, let's talk about targeting. How are you targeting other YouTube channels? Are you targeting by topic? How do you, where do you find the best results?

06:24 Christian Hoppe A lot has changed over the last, let's say one, one and a half years. So if you look back one and a half, two years, or three years, maybe that was, YouTube had a lot of possibilities in terms of targeting. As you said, you could target other channels, you could target keywords. There's a lot of things you could do. Nowadays it's not possible anymore. So if you want to run around conversion, focused ads, you are not able to do all displacement targets, and targeting and stuff anymore. So you can just run awareness videos, but then if you focus on awareness, you're also not gonna get conversions. So unfortunately that's not possible anymore. However, I always say that creative does the targeting. So I think one big misconception about YouTube ads is, people think they want people to watch the video, and that's actually not the case. You actually want to make people skip the video, those people that are not your ideal target audience. So how we pre-qualify customers or potential customers is we actually are very specific in the beginning of the video, and make those who are not our ideal target audience skip. And that tells the algorithm kind of, who are the right audiences to focus on, and then deliver the video to a more qualified audience.

Andy Splichal Give me an example, how do you do that?

Christian Hoppe So for example, let's say, you could say, hey, do you struggle sleeping at night? If I don't see what I'm selling, right? Then I could be selling now supplements that help you sleep. I could sell you a pillow or a mattress. I can sell you, I don't know, a sleep tracking app. So you need to be very specific also, for example, on what you're actually, what the product and the core offering is. You don't want to just hook people, and then after 30 seconds, they find out, oh, it's about supplements. I'm absolutely not open to take supplements to sleep. And then they skip. Or if you have a high quality product, and it's about a certain price point, then you want to speak about that openly and not later make people find out, oh, that's actually not affordable for myself, right? So this is one example. Or you just don't want to say, hey, what are you going to see in this video is totally going to change your life, right? So exaggerated. So you want to be very transparent, and straightforward also with that in the messaging.

And why do you want to get them to skip?

Yeah, again, I said, if you tell the algorithm kind of, okay, these people skip because they're not interested in the product, that helps the algorithm to also show the video to more people that keep watching the video. And so this really helps to pre-qualify and pre-filter the right audience. And those people that keep watching actually, they really keep watching a lot of the videos. So then you have one and a half, three minutes where you can deliver a lot of content and a lot of value. And that is with 95% sound on, so there's a lot of warming up the audience before they actually go to the landing page.

09:18 Andy Splichal And what landing page or call to action do you find work the best for videos?

09:25 Christian Hoppe So that's really depends on the products on the offering. We work with many different e-commerce, also coaching and consulting and SaaS. It can work, you know, classic product digital page, but it can also work that you create a dedicated sales landing page. In general, we'd recommend that you first start with finding out what messaging works best in the ad creatives because there's where you have the biggest leverage. And when you find out, okay, this is one message, one angle that works, you can then go and optimize the landing page afterwards. So for example, if it's about gaining weight, gaining muscles, losing weight, different angles, then you can build very specific landing pitches for these messaging and optimize from there.

10:09 Andy Splichal Now, what services do you offer clients through your agency, at Ford agency?

10:18 Christian Hoppe Yeah, most clients we work with, they just, you know, give us the full scope. So we help them build the outline, the scripts, find and do the research first, then build the outline and script for the creatives. We help them with the creative production. So we do everything for them. And also in parallel, build up the accounts, the campaigns and do the full media buying. Sometimes also happens that clients produce creatives in-house, then we just help them write the script, get the creatives done, give feedback and help them with the media buying.

10:54 Andy Splichal On the creatives, so videos, are clients using those like in their Facebook ads as well? Or do they use them just exclusively with YouTube ads?

11:00 Christian Hoppe We give, you know, once we produce creatives, clients can do with the creatives, whatever they want. Also with, mostly with the footage. It is interesting because YouTube is very specific, right? As a format, as mentioned, there's hardly any other channel that has one and a half, three minutes videos that also work in a landscape mode or in this format. So clients are free to use that, but mostly we find that meta works differently. It's the same if you would take a meta creative and would run it on YouTube, most of the time it doesn't work. So you can restructure it because of the format, but most of the time you can take snippets and recut it and make it fit the other platform.

11:53 Andy Splichal Now, the service that you guys specialize in is YouTube ads, but is there any other channels that you work with or offer services for clients?

12:06 Christian Hoppe Of course, yeah. I mean, I've been working in D2C for the last five years in digital marketing for the last 15 years. So I come from, I've been working in agencies and I'm working in D2Cs. I've helped build brand the whole D2C from when it just started out to close to a hundred million. So basically I come with always the bigger picture and we try to also work with brands from this bigger perspective. So I regularly tell clients not to start YouTube yet because it might be too early, but also we try to not see it as mainly from acquisition perspective, but also acquire customers that have a very high lifetime value. So for example, if you, let's say you have different angles and your product that say it's convenience food and it helps a very healthy audience like sports people, sporty people to live a better life, then these people will be very motivated to use your product. While if you target with a different messaging in acquisition, for example, everyone who just orders fast food, you might get customers that have a lower lifetime value because they're not as motivated to keep using your product. So even if we get cheaper customer acquisition costs with some audiences, we try to always acquire audiences and look also at the bigger picture to acquire customers that actually also produce a high lifetime value. So this is kind of all perspective we specialize in YouTube ads, but also try to see it from a bigger picture what really makes sense for the business.

13:38 Andy Splichal So what are the common mistakes that you see when people come to you and they've said, I've tried YouTube ads, but they haven't worked?

13:43 Christian Hoppe A lot. So most people just really take their TV commercial, take the meta ads, put them in YouTube or take some existing YouTube video that they have, put some budget on it and think, then this works. And it requires this whole understanding how to build, of course, the whole account and campaign structure, but also especially the creative structure, and then also give it time to learn. So produce creatives where you actually know you can test different hooks, you see what works and then iterate from there. We usually very fast. So within three, four weeks, you can really see how much you can achieve with YouTube. So it's not that it takes forever or several months, you can do that within three, four weeks, but you have to have the right structure and right approach for testing, especially in the beginning.

14:33 Andy Splichal Now, do you have a favorite success story of one of your clients that you could share?

14:38 Christian Hoppe I think our most important success story was in the beginning when we tried to run YouTube ads the first time and we burned 100,000 euros, as mentioned, and achieved basically no return on ad spend. I think it was 0.04 return on ad spend. And then we managed to scale it to around 600K ad spend a month at 1.9 ROAS in nine to 10 months later. So that was a lot of hard work and showed us that it can work. We still didn't know if it works for other brands. So then other brands came and we started working with other brands and we saw the same concept work across brands and also work for other brands. So now we have several brands that we've been working for one and a half years that also spend six figures a month on YouTube ads. And so this is really cool to see that this initial effort and work, yeah, worked out.

15:36 Andy Splichal And what are some of the challenges that you've struggled with in getting results?

15:41 Christian Hoppe That's a good question actually. I mean, YouTube ads don't work for everyone, right? So if you have a very, let's say very generic product, no distinguishing from anything else, like let's say yourself socks and underwear, and it's like, you know, there's nothing special about your product. It's very, very hard to make it work, right? So it really depends also YouTube works really well if you have product that is specific that maybe also needs explanation. YouTube works, yeah, if you distinguish yourself from others. So there are definitely some, I would say, categories or verticals that are harder to make work than others. And the benefit on the other hand is like, if it once works, it can work really well. So the creative fatigue is very, very low on YouTube ads. It's something that many people don't know. Like on TikTok, I think you need to iterate very, very fast on meta, it's medium. And on YouTube, you can spend a million on one creative and still the best performing creative after six months. So that's the upside.

16:49 Andy Splichal So what are the verticals that really lend themselves to doing well with a YouTube? I mean, I think you had said a little bit, you know, if it's a product that's unique or needs explaining, but is there certain, you know, clothing, does it do better? I mean, you know, how is there certain vertical for e-commerce companies that would do better than others?

17:11 Christian Hoppe Anything that solves the problem works really well. Anything that needs explanation, I would say there are hardly any verticals that don't work. Fashion is one that's really hard. That comes to my mind. Fashion to release something in this direction is very hard because it's not really problem driven. It's more desire driven and often very hard to distinguish, you know, just from design. It doesn't need a lot of explanation, but apart from that, anything like supplements or beauty or anything, you know, that kind of solves the problem. So the core industries of the core verticals of e-commerce are all doing well on YouTube.

17:48 Andy Splichal And who's the perfect client for your agency? Is there a certain budget they need to be willing to spend or certain annual revenue? What makes a good client to work with you?

18:00 Christian Hoppe Yeah, I usually say that clients should start YouTube ads once they establish at least one push channel really well. Like usually they run meta ads and they scale meta ads and it works. It's a lot easier to start with one channel and then expand than if you spend, you know, a lot of resources in basically managing too many channels. Usually that's around five million a year or 10 million a year is when it really starts making sense for e-commerce brands to start with YouTube ads.

18:29 Andy Splichal And how can an interested listener learn more about working with you?

18:34 Christian Hoppe Sure, I mean, always happy to have a chat on a website that's forward.agency. And we have a lot of information there as well. Also some brands to work with and how the whole process looks like. I'm always very direct and honest with clients. So even if I see that it's not a perfect fit, I always try to provide value and, you know, let clients know when it might be a good point to come back and start YouTube ads.

18:59 Andy Splichal Well, this has been great. Is there anything else you'd like to add before we wrap it up today?

19:06 Christian Hoppe Yeah, I think YouTube ads really a channel that is still hidden. And for some brands, especially when they're doing five, 10 million a year, it's also a channel that, you know, if you're not on YouTube, you're really missing out. As you know, it's kind of a brand protection as well, because YouTube is the second biggest search engine next to Google. And you have all the search terms there. So basically, everyone who is, you know, has been in touch with your brand or, you know, could be in a retargeting audience, that your competitors can tap into your audience and also take the audience from you. So it really makes sense to look at YouTube. If you are not in that size, I think you're missing out.

19:48 Andy Splichal Those are great final words. Well, thanks for joining us today, Chris. Thank you, Andy, for having me. For listeners, remember, if you like this episode, please go to Apple Podcasts and leave us an honest review. And if you're looking for more information on Ford agency or connecting with Chris, you'll find the links to the show notes below. In addition, if you're looking for more information on growing your business, check out our podcast resource center available at podcast.makeeachclickcount.com. We have compiled all of our different past guests by show topic and include each of their contact information in case you would like more information on any of the services I've discussed during previous episodes. Well, that's it for today. Remember to stay safe, keep healthy and happy marketing. And I'll talk to you in the next episode.