Omnichannel CPG: How To Maximize Profitability on Amazon

Omnichannel CPG: How To Maximize Profitability on Amazon

Max Rudy is the Director of eCommerce at Wild Planet Foods, a large-scale, sustainably focused seafood production company. With over 20 years of experience in CPG, he is an expert in Amazon vendor management and omnichannel e-commerce strategies. Before Wild Planet Foods, Max was the Director of eCommerce at Happy Family Brands, where he scaled the company’s e-commerce department from 12% to 32% in five years.

Here’s a glimpse of what you’ll learn: 

  • Max Rudy talks about his trajectory in e-commerce and his role at Wild Planet Foods
  • The challenge of selling on Amazon 
  • How to maintain e-commerce profitability
  • Pivotal considerations for media effectiveness and category management 
  • Max shares his plans to develop targeted full-funnel campaigns in 2024
  • Navigating the first 90 days in e-commerce marketing: advice for fledgling leaders

In this episode…

Since 65% of CPG searches begin on Amazon, brands must develop a strategy to sell their products there. What factors should you consider when positioning your brand on Amazon?

With deep involvement in CPG sales on Amazon, Max Rudy maintains that as the third largest media channel, Amazon is mainly profit-driven, and while brands may believe they’re profitable on the site, many need to enhance their P&L further. To optimize profitability on Amazon, you must track revenue growth in the context of sales rather than focusing on ROAS. Driving organic traffic to your Amazon storefront will generate brand awareness, increase conversions, and create a new pipeline for product sales. 

On this episode of Ecom Experiences, Samir Balwani hosts Max Rudy, the Director of eCommerce at Wild Planet Foods, to discuss integrating Amazon into your CPG e-commerce strategy. Max shares advice for marketing leaders during their first three months, what he enjoys most about his role at Wild Planet Foods, and his plans to develop targeted full-funnel marketing campaigns in 2024. 

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Episode Transcript

Intro 0:00

Hey welcome to another episode of Ecom Experiences a podcast where e-commerce marketing leaders who want to grow and scale their brands faster. Join us as we interview some of the smartest brand founders and marketing leaders in the industry. Explore the lessons they learned discover the keys to their success, discuss what excites them most about the future.

Samir Balwani 0:28

It's Samir Balwani. Here hosted Ecom Experiences where we talk to brand founders and marketing leaders about their experiences growing brands. This episode is brought to you by QRY. QRY is a paid media agency that helps brands balanced brand awareness and performance marketing to drive predictable and profitable growth. I'm really excited about our guest today, Max Rudy, the Director of eCommerce at Wild Planet Foods. He's super smart does a lot of things. And so excited to have this conversation with you. Thank you for joining us today Max Samir.

Max Rudy 0:57

Nice to see you again. Hey, everybody.

Samir Balwani 1:01

Awesome. Well, let's start with the easy stuff. Max, tell us about you tell us about the brand that you work for.

Max Rudy 1:08

Yeah, I'm Max Rudy, I've been working in digital media or e-comm, since the, boom, and two in 2000. And found my way into e-commerce and right around 2013. And so I've been in it a little more than a decade. But yeah, and I'm currently with Wild Planet Foods. I've worked for big brands like Rubbermaid and Sharpie, I've been a consultant, I spent five years at happy baby helping grow their e-commerce, particularly on Amazon from from about 12 million to about 40 million. And then just growing that overall e-commerce split there, from somewhere around 12 To 13% to 33% e-commerce. So really like to take these challenger brands and grow the business with them. That's

Samir Balwani 2:05

really exciting. And so tell us more about Wild Planet Foods. What is it? What's your role there? And how does that work?

Max Rudy 2:12

Yeah, so I've been with Wild Planet Foods for about two years, it is the most sustainable can tuna on the market, by far, just an amazing product. And I'm really, really happy to be involved with this brand. So I came in about two years ago, and that company had just been acquired by a larger CPG company, out of Italy called Bolton. And while the company like a lot of companies, pre acquisition, spent a lot of time focusing on its top line growth, it was now time to make it a working p&l with, as you know, with something like Amazon can be very difficult. And so, you know, came in with a philosophical question of, can you make money on Amazon? Yes, would you make money on Amazon? By the time you're smart, you know, especially when you're a growing brand. So yeah,

Samir Balwani 3:14

it's interesting, too, because I think a lot of brands look at Amazon, as Amazon's very good at hiding a lot of its fees. And so, you know, sometimes brands think that they're, they're very profitable Amazon only to be realized when we realize, you know, later on that they're not and then some brands also just look at it and go, it's a wholesale relationship, and it's more brand awareness than it is meant to be a sales channel for us. And I think that that I'm curious, your thoughts on those two, you know, outlines. But I think that can also be a little bit of a death knell because you start to train people to purchase on Amazon instead of your own site.

Max Rudy 3:51

Yeah, well, exactly. At the end of the day, I think profit helps everybody. Right? Yeah. Yeah. I'm not going to go to a business that would think that that would rely on Amazon as its as its most profit driven. Customer, Amazon. Amazon is, is a lot of things. It's the third largest media channel. It is. It's, it doesn't have anything comparable, it speaks a different language. The, the the easiest parallel is the difference between a Mac and PC, PC is open system. That's the rest of grocery, that's the rest of customers. And they're all sharing tools. They're all you know, they all have different tools you can plug into and you can service those customers and then there's the closed system, like a Mac, that's Amazon, and you need to be the person that is able to capture everything that Amazon does. And put that information in provide that information to your leadership, and then be able to answer the real questions of what do we want to do with this p&l? How can we make it better? Because when I came in, at the end of that year, we lost $2 million and overall profit. Just just doing business with Amazon? Yeah, that's

Samir Balwani 5:22

interesting. That's not a unique conversation that we have, we find out brands all the time. And of course, there's accounting magic that happens to make it seem like it's not. And they'll, you know, they'll put this charge back over here, and then this line over here. But reality situation is, it's important to look at Amazon, and honestly, all your wholesale partners with a really fine tooth comb to get a better understanding of where your dollars are going. Max, I love the role you have and just like how expansive it is, I know you cover everything from operations to high level marketing to pricing. So tell me, what's your favorite part about your role?

Max Rudy 6:07

Oh, well, I guess weekends isn't the correct answer. I

Samir Balwani 6:14

mean, you just came back from vacation. So

Max Rudy 6:15

yeah, so I mean, I like to be able to go, but the best part of this job is the people, right? And that sounds silly. But what I get to do is I get to collaborate across the entire business. Yeah. Happy Baby. Our CEO there used to call me kind of like a jet, a general manager of the business, because you have to literally understand how stuff is being sourced all the way to how customer service is reacting. Your Amazon business in particular, is incredibly important for how people perceive your brand. 65% of CPG searches start on Amazon, you will always find someone in the aisle of a supermarket looking on their phone at an Amazon rating. Because that's where people get their ratings and reviews of products, even if they're buying it on shelf, right? Amazon is a tool. It's a law, it is something you're plugged into on a daily basis. So while a lot of retail media is about getting stuff in the in the cart, right, Amazon is about Amazon is about not just getting stuff in the cart, but always having that cart open.

Samir Balwani 7:37

And it's interesting that you say that, because it's I think the being on the phone and looking at reviews is not unique to grocery either, like you see it on electronics, you see it in you also right? Like, it's interesting to see this, like when you have access to information, how does your brand new appear? And then the question is always, are people going to Amazon? Are they going to your site? Are they you know, who's coming up first? How is that appearing? And so I think that brands need to be really thoughtful about that, too. And realize that even if you don't sell on your own site reviews don't matter, because people are looking for them.

Max Rudy 8:24

So we are fortunate to have DTC site legacy long before me and I you know, I like I was telling you earlier I met I manage the business side of the DTC site, but not the marketing, you're running the site. But we have a ton of great reviews there. And we're syndicated. We're syndicating them out to all basically, whether it's power reviews, Bazaarvoice any network we can that gets out to our retailers. So when you look on Target, Walmart and then even these grocers, right, you'll see most brands have like, one or two reviews still and that's a big thing. And we have hundreds and hundreds of reviews. Yeah, because we have a super loyal following that you know was cultivated years and years and if you have a brand like that your your direct consumer has a really important role for capturing those loyalists and being involved there. So you know, it is all about the e-commerce mix. So I don't just manage Amazon, right. It's those retail me media partners and bricks and clicks and, you know, other growing pure plays.

Samir Balwani 9:41

It's really I love that because I think getting super focused on only one channel and also forgetting the brand, the value of your community. You know, having other reviews makes people want to be a part of it right and And I think there was a study done like a community going from one to two is the hardest two to three is easier, three to four is easier. And it just gets easier from there. And it's exciting to hear about your investments in brand and how you guys think about brand. But, you know, as we think about 2020, for the year ahead, what are the challenges that you're thinking about Max? What are the things that are keeping you up at night?

Max Rudy 10:27

Well, I mean, a lot of it is profitability. I think it's, I think it's like on Amazon grocery, our traffic's up about 9% So far this year, which is good, actually. But in the in some years, it's a mixed bag. Like last year, the traffic wasn't up, like the organic traffic from Amazon wasn't up at all. We're finding that we're finding the Instacart right now. It's just delivering tremendous results. Or if you're in the tuna business, it's horrible. Please don't invest. But ya know, it Instacart and it's no secret, right? They have 85% of grocers brochures, and I think you can even like if you are selling electronics, they have Best Buy, they're just go order me off. Instacart like, it's amazing. Right. But so they're doing really well. Um, it's the, what keeps me up at night a lot is a couple things. One is it's the it's the, it's the growing pains of the retail media industry, as they develop as, for instance, Kroger has had a rough go of it over the past few months as they've, as they've went to a new platform. Right? That's right. Yeah. And so, you know, that really kind of killed some momentum there. And then when budgets came and we, you know, we have a number and, you know, we need to throw something to the budget gods of money, right, where he, like, already happened once this year for me, right? And we're doing well, and who gets sacrificed but the Kroger DSP, yeah. And that DSP is really important to run with your search. But I, you, you have to be able to justify your spend. So what will happen, right is when these platforms are changing like this, you know, that so underperformance keeps me up, I guess, and yeah, and, and that, you know, there are, you know, there are some really good performing media, and, and then there's some people selling some stuff that's not so good. And, um, if you don't know how to read your stats, if you don't really know what you're looking for, if you don't know how to evaluate lift, and like your total growth of sales, and what percentage of your business is paid media versus non paid, that, you know, you're gonna have a tough time evaluating whether your media is effective. So media effectiveness is another one, right? As I look at the budget, and I got to figure out where to put it, I have to figure out that, really, that's so so so really, it's traffic coming in, and media effectiveness, keeping me up.

Samir Balwani 13:36

Yeah, that's interesting. Can you talk more about your media effectiveness? And like, how do you guys actually consider that? How do you think about that?

Max Rudy 13:42

Well, before I went, Amazon had me talk at Expo West, which is our big trade show last year. So I decided to use it as as, as my platform to declare role as dead. I love it. Because row as gets real as does not get. It's not a be all end. All right, right. And so it's easy to poke holes in it, because it's just a return on on adspend you have to think about it correctly. You know, don't divide the sales off of your shipped cogs on Amazon, it's off of its revenue off of revenue. That's how you tell the difference. And you know, it's some of it is supplementing, like she would have already had other parts of it are absolutely getting you new sales, right. So we track new to brand very closely. Again, we're in it we're in we're in a prot we're not an adorable space or something like that. But we're really in a consumable space where new to brand is really important metric for us to figure out, hey, you know, is this is this moving the needle? We also did it. Mmm with Amazon. So that's not exactly it's like a media measure. Yeah. media mix modeling. Yeah. media mix model. That's right. Excuse me, it is Monday. And what we found there, you know, is not surprising. But again, what if what we found is lift is very different than ro s. Right? Yeah, I think we know that. And, you know, we found certain tactics to be a lot more successful than others.

Samir Balwani 15:32

Oh, that's interesting. And the media mix model that you did, how, what? Was it looking at different placements within Amazon? Or was it we

Max Rudy 15:40

only looked at the Amazon environment? You could add to see if there's effects across other sites, but we kept it within the Amazon environment. And yeah, it's just really figuring out, you know, whether you're what what media, basically at following people down the funnel and, and figuring out what's working, what's not. Yeah, I

Samir Balwani 16:05

love that, because that's one of the unique elements of Amazon is that because it's a closed loop system, you can do those kinds of models pretty easily, and get a really clear understanding of, of what is effective on that platform. So I love that you guys did that. How are you guys measuring brand impact of your media?

Max Rudy 16:27

So I mean, cantar studies help. Yeah. So you know, one of the ways that we look at it, but it's going to be your unaided versus aided and aided awareness, and whether you get a jump there, ultimately, you need to be creating new, a new pipeline for your products. As I just said before, Amazon traffic for me right now is up 9%, will it continue to be up? 9%? I don't know. Right? So how do I create my own traffic? I'm gonna have to either create traffic, or increase conversion. Right,

Samir Balwani 17:04

right. So how am I then? And how do you peel back? What is Brand Lift and media lift versus category lift? And category demand to your right, like, is your traffic up? Because you know, the consumer is looking for more tuna? Or is your are you to the pie get bigger? Or are you getting more pie.

Max Rudy 17:26

This gets into another issue, which is category management. Whether your business is harmonized with e-commerce and category management or not, chances are your business is not in it, and it stinks, you need it. I think that being able to measure just like you do an IRI or Nielsen, your share of the category, where you're going in the category is super important to figure out what you're doing in that race. You need to know what the market is growing and whether you're growing with it faster. And ideally, you should be growing faster than the rest of them. Right?

Samir Balwani 18:09

Yeah. Yeah, that's really interesting. Amazing. So we've talked about challenges. What about things that are exciting for you? What are you looking forward to most For 2024,

Max Rudy 18:20

I'm doing these really, really targeted full funnel campaigns, where we're focusing on audiences that have purchased in our aisle on Amazon, right, but haven't purchased us and being able to hit them with full funnel marketing. So, you know, we took a really good performing 32nd ad, broke it into two fifteens. And we're, we're launching that across a streaming OTT audience that is so specific, you know, it is so precision. And our goal isn't to our goal isn't to, you know, reach this mass audience. We want to focus on people that we already know know how to buy in that category. already liked the product that in and we're hoping when they see your product, they'll say, Oh, look at these reviews, and everything will tie in with it. Right? So the the marketing from from from that, then the display, all the way down to the content will all be matching messaging. So it's one consistent messaging as you go through, and then it's incentivized by promotion while you're doing that. So you're really kind of, again, trying to make the funnel as as as as clean and concise as possible. Yeah, that's really,

Samir Balwani 19:49

really cool. I'm excited. I love that because I think people are revisiting how brand plays into the overarching campaign structure. And and what it means to have performance media versus brand media and how it's really all the same and needs to all tied together. Because every touchpoint is a brand touchpoint and, you know, postcode through COVID, post COVID e-commerce sites and and retail media have had this, you know, going back to that, did the pie grow? Or did you grow more of the pie everyone, the pie grows so fast that all the money went into performance, because there's so much demand to capture. And now that that demand is starting to wane that people are having to spend more time on their brand marketing and to capture more of the pie, realizing that performance media doesn't capture the pie, it doesn't, it doesn't help you convert new customers into category buyers or steal market share from your competitors. It's either discounts or brand marketing. And it's that balance between the two that you need to figure out that's going to lead you to growth. Yeah,

Max Rudy 21:03

100%. And again, you know, that's why watching the new to brand, and understanding how long near the brand metrics are good for like, some are shorter than others. So you'll see slotland might be a three month and you're like that three month window is basically worthless data at that point, right. But if it's an IR it's very good data, right. And Amazon's a year, so they have good look back window for that. So that's what I do in the middle to make sure my sponsored whatever sponsored spend is working well. On display also, right. I'm making sure that my money is put into consideration. And that and that new to brand as my main metrics there, right. I don't really even report on row as on display the row as attributed row as is so like, it's you. It's like not, after you train people that teach them that sponsored search isn't a coupon or something, but it's an actual set converted sale, then you have to tell them that that all those attributions from that say that, you know, basically took credit for 50% of your sales. Yeah, like, they were only responsible for a small amount and sliver of it. And so what we, so that's again, where we use new brand. Yeah. Yeah, I

Samir Balwani 22:32

think new brand is just such a important. high key metric there for sure. Max, let's, let's do my last question for you. So, here, here's what I love to ask people, for a new marketing leader in their first 90 days, what advice would you give them?

Max Rudy 22:53

Particularly in and like, say a new e-commerce marketing person? Yeah. Don't it? If if there are silos break down silos immediately. Say, Yeah, I mean, do not walk into a business, where there's where they're, like, we're siloed. And we're not going to change, because you need to have the buy in, of your operations team of the people filling your orders, you need to have the buy in of your, of your brand marketing team, and your comms teams and your product team. Right? Because you're going to want because assortment is such a big part of winning on e-commerce, you're going to get the buy in again, your marketing budget and, and you're going to be in that fight between sales trade, and Mark calm of where your money gets spent. So you gotta you gotta be you gotta hang with those people and you got to you got to you got to acquiesce sometimes, and give them what they need. Even if you think it, you know, you could spend the money. But you know, I like to work really closer with a shop close with the shop or marketing person for that, by the way, because you can do a lot of money, money switching if something's not effective, and move it around. But But yeah, meet all those people and get them in a group. I think more important than who you are, who you are, is way more important than who you manage. It's, it's who you collaborate with, right? Because you need them you need to skill them. You need to educate them in and up their skills in e-commerce so that your chargebacks aren't happening so that your shortages are getting repaid etc, etc.

Samir Balwani 24:44

It's so interesting you say that because it's we have this vision on our end here at the best agency managers so the the brands that manage agencies the best they see their role as being the hub and us being a spoke and all their other partners being a spoke. And their job is to tie us all together and to get us all spinning in a wheel properly. And to make sure no one's out of whack or missing. And

Max Rudy 25:15

and so, you know, my my great my superpower isn't responding to emails. My superpower isn't putting together a PowerPoint presentation. Those things I could probably use a little help with. But my superpower is absolutely getting all of those spokes to be in one team rolling in the same direction.

Samir Balwani 25:36

That's the That's a great leadership superpower. So definitely a good win there. Max so thank you so much for joining us. This was such a great conversation I definitely learned a lot if people want to find you online. Where can they learn more about you?

Max Rudy 25:52

Um, you can check me out on my LinkedIn it's just Max Rudy Max Rudy I post there sometimes some things I'm doing otherwise. Yeah. Amazing. Check me out at some awesome years podcast.

Samir Balwani 25:59

I love it. Max, thank you again so much for coming.

Max Rudy 26:14

Thank you have a great one.

Outro 26:20

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