Samir Balwani is the CEO and founder of QRY, a media agency that helps eCommerce and DTC brands like Delsey, Zadig & Voltaire, and Peak Design accelerate their growth. We discuss paid advertising, brand awareness campaigns vs. performance campaigns, what metrics are most important, and much more.
What is QRY
Samir Balwani: Yeah, so QRY is a media buying agency for high growth e-commerce businesses. So we've created a process that allows us to help our brands scale profitably in a sustainable and predictable way.
A lot of times e-com businesses like to grow in like very spiky and kind of taking advantage of whatever they have ahead of them versus really having a framework from which they can look at their campaigns and figure out what's the best channel, what's the best audience, what's the best creative, what are we testing to make sure we're being incrementally growing in a day-to-day basis.
And so that's what we do and we do it extremely well. We do it for eight figure plus e-com businesses.
Alex Bond: No, that's good. So that kind of already gives me like a range in y'all's capabilities. Yeah, I mean, eight figures is pretty big in my opinion.
Samir Balwani: And so it's more, it's like mid-market to enterprise for more. So people that have figured out product market fit, they have a brand, they really understand the value of their brand. Nine out of 10 times clients coming to us because they've kind of hit that plateau where they're trying to figure out, a lot of times, you know, we'll end up happening. I've reached this amount.
We're happy with our media, but how do we get to the next level? How do we spend an extra 500,000? How do we spend an extra million in advertising? Where does it go? What does it mean for the business? That's the kind of stuff that we love to tackle and how we help kind of help our clients really think through that work.
Brand Awareness Campaigns vs. Performance Campaigns
Samir Balwani: I think one of the big things that we identified is a lot of direct to consumer brands like e-com brands have always been performance first and always performance and driving that return on ad spend, really focusing on growth from that perspective, almost the detriment of brand building and long term brand investments.
And so what we do is we kind of marry the two together. We help our brands really think through. How do we use the profit that we're driving from our performance media to fuel brand awareness that allows us to continue to grow the brand and introduce the brand to new customers so that way it then cycles into our performance media and everything grows together.
And striking that delicate balance requires true subject matter expertise and media buying and and e-com media buying in particular, as well as a really good understanding of data analytics, attribution, and how that finally flows down to the bottom line for the business.
Alex Bond: So what I'm hearing you say is that you're essentially taking your performance revenue and putting it into the brand awareness are a lot of clients that you work with happy with that strategy or is that kind of tough to wrap their head around? Cause they want profit at the end of the day.
Samir Balwani: So it takes some time to help them understand. And there's a lot of education that we have to do on our end to help. Brands feel comfortable with it.
At the end of the day when top line revenue grows and you're not losing money and you're actually growing your profit as well, brands love it, right? So I think there is definitely this hump at the beginnings, and part of that is because of how E-com businesses also structure their teams.
And part of it is because growth and performance goes to one team brand and marketing goes to another team. And so kind of marrying the two together and having people work together on that is not always easy. And so we get to play that middleman sometimes of, hey, we're helping both of you grow and this is how we're helping.
Alex Bond: Totally. How do you decide how to properly allocate a client's advertising budget between those two campaigns?
Samir Balwani: We'll do an analysis with our clients when we first start out around what we like to call a break even return on ad spend. And so we take their average margin or product margin and determine how much profit do they make Every time they're, you know, they get a basket sold.
We'll say, all right, we're comfortable spending up to that in media to cover that purchase work with the client to figure out break even return on ad spend, figure out what kind of profitability buffer they want. 10%, 20%, 30%. And then we target that for our campaigns. So let's say your break even return on ad spend is 1.5, meaning for every dollar you spend, you need 1.5.
In return we'll say great. That's gonna be our target for our campaigns. We're gonna maximize our performance spends and drive as much return on ad spend as we can there. And then whatever we make from that, we will invest in upper funnel. So top of funnel prospecting to introduce new customers to the brand, but overall campaign ends up at a 1.5, 1.7, and everyone's happy because we're not losing money and we're still growing the top line revenue.
And if a brand said we want it to be 20% profitable, 30% profitable, we've baked that into the return on ad spend. We use multi-touch attribution to just make sure our top of funnel brand awareness campaigns are actually reaching the right customers. So we know, you know, these awareness campaigns are actually leading to performance increases in growth.
Alex Bond: Yeah, because that's one of those things that you have to track a little bit more. I don't know, difficult, like brand awareness is something that is not as tangible as performance.
Samir Balwani: And we can do brand recall studies, we can do brand lift studies depend
ing on the budgets that we're talking about and the channels that we're activating, right?
So, you know, doing large CTV campaigns or large programmatic display campaigns, we can look back and see. But also, you know, we have a monthly media forecast and we'll know if revenue is growing. Another indicator of that is our brand search campaign growing?
Cause if we're investing in brand awareness, you would expect that more people are searching for the brand and are interested in the brand. And we'd like to see brand search volume increase. So, you know, we'll put timelines against these things and, and have a really good indicators on is this working or not working.
How QRY decides which brands to work with
Alex Bond: What sort of a strategy it goes into deciding if a brand is ready to work with you or vice versa? You know, I hear you say you're generally looking for brands that are trying to break through, they've been putting in some effort and are just trying to break that ceiling a little bit or get outta this cycle that they've been in. So what goes into that strategy to see if brand is ready to work with you or not?
Samir Balwani: Yeah, so we look at a few things actually. So we'll do a full assessment to really understand one, can we actually help the brand and then is the brand the right fit for us? Right? So the first part of that is we'll look at things like conversion rate. And average order value. We know basic costs of advertising.
We've got a series of benchmarks are actually published on our site. You can take a look at them, but for the most part, we have an understanding of how much it costs to get a customer. And so we need to make sure that your website conversion rate and your average order value can support that, especially as we start to scale up because your conversion rate will start to go down a little bit as we bring colder audiences and new customers to the site.
So just making sure that mathematically everything kinda fits. And then on the kind of qualitative or qualitative side it's around is their brand loyal to already? So do you have returning purchases? Are people talking about you on social? Are, do you have good product reviews?
Because brands hate to hear this, but sometimes you're stuck because your product just isn't fulfilling the need that people think and you're really good at acquiring first time customers are really good at getting people excited the first time around, but then after that, something's falling apart. Product's not what they expected, or it's not as strong as they wanted, or whatever may be the case.
So, you know, we really need to make sure that we have good products. And then a really good website experience. From there, it's around budget. And do you have the capacity and willingness to want to scale? Because look, some brands, especially now as we go into like leaner periods, they're really leaning in and saying, no, we need to maximize as much profit.
We're gonna give up full growth. We just need to stay flat this year and drive as. That's fine. That's a real marketing strategy. I would disagree with you. I would say in downturns you generally want to increase marketing spend and try and capture more brand volume. But you know, for some people the strategy is let's kind of pass through this year.
Those aren't the right fit for us because our team is going to really look at and figure out how do we actually grow this campaign? How do we find new opportunities for growth? So that's kinda what we're looking for.
Alex Bond: So what I'm hearing you say is you like people who are gonna be more susceptible to an aggressive strategy.
Samir Balwani: Yeah. An aggressive strategy with guardrails. Right? So, we wanna make sure that like, we'll never come to you and say, hey, you should lose a ton of money to help you build your top line revenue. Like that's not a win for anybody.
But you know, if you come to us and say, hey, we need to be a a 10x return on ad spend and grow 50%, we're gonna say, hey. I don't think that that's realistic. You're gonna have to choose one or the other, but it doesn't mean that you can't grow profitably. It's just what's the, where on the spectrum do you wanna be?
KPI metrics and its importance
Alex Bond: And speaking of your benchmarks, I was noticing on your website those extremely useful charts for these advertising benchmarks and trends based on data from high growth, e-commerce and, and DTC brands from the last 30 days.
So these charts showed live feeds of KPIs or key performance indicators like, you know, cpm, cost per click, click through rate, conversion rate. For someone just base baseline starting in the e-commerce world, why are these metrics important and what are they in a very easy way?
Samir Balwani: Yeah. We publish these like media benchmarks because, I think they're important. They add context to what's going in the market. So just to give background on this, this is data across all of our clients. In terms of e-comm data from media spends, again, high growth. Eight figure plus media. So you're talking large data sets.
The key here is don't look at the number, but look at the trend and compare your brand against the trend. So if everybody's, you know, CPMs are going down and your CPMs are going up, you might want to question what's . Going on. Similarly click through rates and conversion rates. The numbers are good. Those are our benchmarks. We hold our teams accountable to kind of making sure that everyone is, is close to at least the client's own benchmarks.
But then we'll use our industry trends as an indicator of is the market moving in a specific way? For example, you know, come into q4, CPMs start to go through the roof. We know everybody's CPMs are gonna go through the roof. We wanna watch that and, and figure out when that's gonna end. So benchmarks are really important not for tying your brand against the actual number, but tying your brand against the trend.
Alex Bond: No, I totally agree. I think that, you know, when I've worked in a similar world, having to figure out what CPM to be at, Is a little tough. So it's nice to have data like that that is kind of like your control set.
Samir Balwani: Yep. It kind of clears out some of the noise, which is is nice. So a perfect example of this one is like conversion rate. And we'll start to like track against day-to-day. So we know like during sale periods conversion rates will go up.
And then we'll track coming up on Valentine's Day right now. So Valentine's Day, we're starting to see conversion rates kind of fluctuate a little bit. As we get closer to Valentine's Day and more sales start to go and more gifting messaging starts to go, we'll start to see that conversion rate go up.
So we like to look at last 30 days. We also published compared to last year. So you can see how things are comparing your rear and, and those trends. So our team uses it pretty regularly. We have found it to be invaluable which is why we wanted to make it available to others.
Alex Bond: No, and I love it. How did you actually get that data?
Samir Balwani: Yeah, so we have a full data and analytics department. So all the data gets pulled. And we actually do a lot of internal regressions on it, on our team side. So the data set you guys are seeing is clean data that's out, but then our team has access to additional data sets off of it. So we collect it all, we keep it and manage against it from our end.
Alex Bond: Wow. That is extremely valuable. Then I bet you have like, I don't know, the access to that is really special to me. I feel like not a lot of agencies go through that avenue of collecting that data themselves. It's kind of just like, I don't know, they grab it when they need it, if that makes any sense.
Samir Balwani: Yeah, and you know, it's funny because with data it's one of those things where as much as we can hold onto, we like to hold onto. Cause you never know what will become important, when it will become important.
And so it has been helpful, especially as we start to look at differences in trends pre covid, post covid and coming into recession. So we try and model what's gonna happen in a world where nobody knows what's gonna happen, and so the more data you have, the better it becomes.
Alex Bond: No, absolutely. I feel like it becomes more valuable over time, too. So most brands that have been in the e-commerce space for a while mostly focus on roas or return on ad spend and lifetime value as their core KPIs. Compared to the ones we were talking about. I think it's because they're more revenue and dollar sign base.
People are like, business dollar signing and my business is succeeding or not. But if you are hitting, if a brand. Is hitting where they're supposed to be on their cpm, their cost per click, click through rate, conversion rate, everything else should follow, ideally, right? So if all those other KPIs are in line, then shouldn't the roas and LTV too?
Samir Balwani: Yeah, so it's why CPM click through rate, conversion rate are so valuable for us. Those are early indicators of will we be successful or not, and how much we can grow. So we know as we scale up a campaign, there'll be some impact on CPM, we know there'll be an impact on clickthrough rate, and we know there'll be an impact on conversion rate.
So we can kind of do the math and model out how much can we spend before we hit, you know, our losses on or start missing our targets on our ROAS targets. We also break it out into two buckets. There's media efficiency and then website experience and product market fit, right? So three key buckets actually, the media efficiency is more around our CPMs.
How efficient are we actually buying media? And in what worlds, what ways are we actually hitting them? Click through rates, another example of media efficiency. Are we getting the right creative in front of the right audiences? And then you're talking website experience and making sure the audience is the right fit.
That's conversion rate. So we got the person to the website. Did they actually purchase the product or not? Was there a mismatch in terms of what we spoke about? Or how they're experiencing the product on the site. And then product efficiency is gonna be around, like the product market fit is really around that conversion rate.
And AOV, do they trust your product and your website enough to want to buy enough of it to drive up your average order value at a good enough rate to continue to scale your campaigns and scale your brand? That's kind of what we look at and that's how we think about that. Sales journey. Obviously there's a lot more on the customer journey behind that cuz there's still like, how is the brand introduced?
How are people, like what's the word of mouth that happened around it? What did the research do? But at the end of the day, we were really looking at those like key metrics. Were we efficient on our media buying, meaning our CPMs were within our thresholds and the clickthrough rates were high meaning we were driving enough people to the website to make a meaningful impact on the growth of the brand.
Media buying trends
Alex Bond: More specifically, what kind of media buying do you do?
Samir Balwani: Yeah, so our core expertise is on digital media buying. So paid search, paid social, programmatic display, connected tv. We do some podcasts, sponsorships as well, and programmatic podcasts as well.
So a lot of brand awareness comes in through our CTV campaigns and our programmatic display and digital out of home, things like that. And then a lot of our performance campaigns are Google and remarketing campaigns, things in that, you know, world.
Alex Bond: What's been the most successful that, that you've seen? What do you put the most eggs in the basket for? I know it's kind of a case by case basis, but I found that different brands do different things where they, a lot of 'em are like, we're big on SMS and email and other ones that are like, we love social media and I'm just curious what you see the trend.
Samir Balwani: I won't tell you what works the best because it is a case by case. I'll tell you the ones that I'm most excited about. Performance Max has been a rockstar from Google. It continues to perform really well. I think there's still a lot more that it can do and I'm excited as more data comes into it, how much better it will get.
Facebook launched Advantage Plus, which is similar, and I'm curious to see how that plays out so far. It seems like it's performing well, but performing well for Meta is all relative is the key thing. And then CTV is just like the Golden star right now on a brand awareness and, and really good.
And, and, and from a high impact standpoint, the problem with CTV is you need really good creative. And that's been fantastic. When you have really good creative, you can really make impactful things. And then the last one is TikTok. Ish. It's still trying to figure out, yeah, it's still trying to figure out how to make it work perfectly and what it plays.
It works really well for impulse purchasing. It works really well for low a AOV products, but once you get into products that have high consideration or you know, luxury it ends up working better as a brand awareness tool versus an actual like, sales tool. So that's why I say ish. It also comes with a lot of baggage in that for TikTok to perform well, you need to have a really good organic TikTok channel too. Like they kind of need to go hand in hand. So TikTok ish is kind of what I'm gonna say.
Alex Bond: Well, and frankly, that's one of the ones that I don't use. So that's not, I did when I was working in that space a little bit. But now that's probably the only social media I don't use because I just think it's I don't know. I am not the demographic for TikTok. I guess I don't know. I mean, I just definitely think it skews a little younger than. Some other social media platforms do. So some of the brands and the strategies. I surely have never bought anything off TikTok. I might have.
Samir Balwani: I've fallen down that black hole few times.
Alex Bond: Well, and thee reason I bring that up is because I'll see stuff on Instagram that in interests me that I'll actually consider buying. And then my girlfriend buys stuff from Instagram all the time. Even if it's not directly from that campaign, it's like, oh, that looks great. Let me go to Amazon and then buy it. I just think there's a lot more value there for my personal experience, you know?
Samir Balwani: Yeah. And that's the hard part is just identifying what brands will do well in TikTok and what's the creative and the messaging. And that's kind of what we do honestly, really well is for each one of our clients, we create something called and going back to like our process.
So we balance paid brand awareness and performance marketing. The way we do that is we create really detailed 12 month forecasts for all of our clients. We know three months will be relatively accurate, six months is a little fuzzy, and then the final 12 months is actually really fuzzy, but it's super detailed and creates benchmarks for ourselves.
So, you know, I spoke about the benchmarks that we publish when we do our internal media forecast, each channel by customer stage has a cpm, clickthrough rate and conversion rate target. So we can quickly look at our campaigns and say, Hey, what's the actual versus what we had planned? What's working?
What's not working? Where do we need to push? Where do we need to fix? Great diagnostic tool. We create what we call an ad experimentation plan or a learning agenda, which outlines out all of the ad tests that we wanna run based on what KPIs are underperforming to our forecast, right? So whenever we run TikTok, if we start to see things like conversion rate is low, or clickthrough rate is low, it generally means we need to do a lot of creative testing, which is what ends up happening on TikTok a lot.
So things like stylized ad versus influencer ad, ad with music, ad without music, things like that that we end up having to work with our creative partners to figure out. How do we get a lot of variations of stuff so that we can do that kind of testing?
Misconceptions about eCommerce media advertising
Samir Balwani: Yeah. I can tell you some of the common things that we run into, one is, lemme think about how to bucket this in a way that actually makes sense in a structured way. So I'd say the best place to start from is tools that are missing. So usually it's things like, Sophisticated media forecast, what can we expect from our advertising?
A reason why it's really important is because for e-com businesses, cash flow is king. So understanding how much you need to set aside for media allows you to make really smart inventory decisions and staffing decisions. And so having that kind of forecast is really important especially as you're starting to scale and kind of push the envelope on your ability to spend. So that's one.
The second one is a really sophisticated learning agenda. So like, what are we testing? Why are we testing them? How do they impact our outputs? And then really clear data analytics. What we did this, this is actually what we returned on the data analytics side, the biggest. Thing that we see that people should not be doing, especially when they're spending over a 100k in media a month.
So think 1.2 million in annual spend. Don't use platform attributed data like that is a nice to know, but should not be used for your op forecasting and, and medium mix modeling. And the second one is, you know, we forecast and track off of last click data, meaning outta Google Analytics, what was blast channel that finally sold the product.
But having multi-touch attribution tools at those at spends are really important to make sure that you are actually spending in the right way and using that as guidance to figure out what channels you can kind of scale versus what channels are kind of capping out. Those are three key things.
And then the fourth one is not staffing appropriately. You should have a marketing manager. You should have really good ops in terms of your 3PLs, your customer service, all of those kinds of things are really important. Merchandising is really important. Paid media is not a silver bullet. In fact, if it's driving too much of your revenue, that's a red flag for us.
We wanna make sure that the brand is also growing on its own meaning. Customers are getting the product, are excited about the product and telling their friends about the product. We should see that in your organic growth. If we don't and you're just straight paid media led, you are gonna hit a cap because paid media gets more expensive as you scale.
Alex Bond: And does that also mean that if people are leaning on totally paid media for their revenue, you might not have a lot of return clients? You know, if you took the paid media away, are people still buzzing about your product or your brand? That could be scary because the brand isn't really that strong enough on its own.
Samir Balwani: Yeah. And we run into those problems where, like the repurchase rate is very long. I mean, it's a product you buy once every 12 months or once every, you know, two years. Those are really difficult for ins to scale until they have another product that is able to kind of churn and get repurchase rates on.
So yes, I think like when, for example, if we see paid media driving more than 50% of your revenue, we get nervous about that. Unless you're in like a high scale growth mode and you're really just using it to build your customer base. But like once you're. At scale meaning you know, eight figures plus again, we'd like to see media be between 30 and 40% of your top line revenue.
That's usually a healthy mix. You should have other channels and there are other channels like PR and influencer and affiliate that you should be activating. Direct mail is there another great one cause catalogs are actually really effective. Things like that are all part of the marketing mix. And kind of the same way on the media side, we say don't only lean into Google and Facebook. Let's make sure we're kind of diversifying your channels. You should be diversifying your marketing.
Alex Bond: Not everyone, especially in the e-commerce, people who aren't in the e-commerce space are spending all their time on Google or Facebook. Like we might, like, a lot of people do spend a lot of time on their email.
I've actually read something that said that's for a lot of business professionals is one of the biggest ways that you could actually get ahold of someone is cause some people are getting a hundred emails a day. When I don't, I can tell you I'm not going to Google a hundred times a day.
Samir Balwani: Yeah. And honestly, the other thing too is just every channel plays a different role, right? So PR and Influencer does a really good job of giving third party validation around your product and why it should be cool and allows you to tell a brand story. Advertising doesn't always tell a brand story in that way. Really figuring out how everything fits together and where each piece of that puzzle needs to be is key for growth.
And you know, our team will tell our clients that, like, we've capped out on our brand awareness, you need to do X, Y, and Z. Or you can give us that dollar, but we'd actually prefer you put that dollar towards influencer or PR because it'll be more impactful for you and the brand.
So I think being able to have those strategic conversations is really important for the growth of our clients.
