Our New Ecommerce Community for Growth

We are excited to announce the launching of our exclusive community for seasoned ecommerce professionals interested in enhancing their businesses, advancing their careers, and making the retail and B2B industries better for everybody.

Let us see our merchandise:

CommerceCo by Practical Ecommerce is for exceptional folks working in the ecommerce industry — be it retail, B2B, or a brand — to learn, share, and grow.

Connected Content

A centerpiece of CommerceCo — the title is a shortened version of”Commerce Community” — is a weekly live demonstration and interview with a company leader, provider, vendor, or specialist.

By way of instance, on January 14, CommerceCo will sponsor Raj De Datta, the CEO of Bloomreach, a digital experience platform which touches about 25 percent of all retail ecommerce in the U.S. and the U.K.

De Datta will be speaking about his predictions for the future of ecommerce and retail, discussing his new book, and answering inquiries.

Member Connections

Each CommerceCo member can post in the community, ask questions, and get or give help to other people. Members decide how active they want to be.

You could sit back, watch some wonderful interviews, and get the inside scoop on top trends. Or you may be a leader, directing discussions, getting information, and media.

It’s entirely your decision.

Members

CommerceCo by Practical Ecommerce is not for everybody. It’s intended for people who work for a merchant (Dillard’s, Lands’ End, Bodybuilding.com, Vat-19) or a new (Nike, DeWalt, Kelty).

It’ll be up to me, the host of CommerceCo, to review the credentials of each member to make sure the community is exclusive.

In the end, CommerceCo is a paid membership with monthly or yearly subscriptions.

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Elements Brands Founder on Moving from Doer to Manager

The essential skills to launch a company are typically substantially different from handling it for the long run. Bill D’Alessandro has done . He launched one ecommerce firm in 2010 and then transformed the business into an operator of numerous online brands. He’s evolved from doing most every task to focusing on a few.

“Among those challenges,” he told me,”was moving from doer to director, from creator to CEO. That’s a jump a great deal of entrepreneurs, myself included, struggle with.”

D’Alessandro’s firm, Elements Brands, now owns six successful ecommerce companies with plans to acquire more. He’s firmly a manager-CEO, with 60 employees.

I talked with him recently about shifting his business, hiring employees, raising money, and much more. What follows is our whole audio conversation along with a transcript, that has been edited for length and clarity.

Eric Bandholz: Tell us about your business.

Bill D’Alessandro: It is called Elements Brands. We have been around since 2010. We’re an acquirer of direct-to-consumer ecommerce businesses. We purchase ecommerce brands and centralize them on our platform. We have about 60 workers in 51,000 square feet of warehouse and office space in Charlotte, North Carolina.

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We’ll purchase a brand and combine the transport and even some production here in Charlotte. We’ve dedicated teams which run each brand. We don’t use plenty of agencies. We do almost everything in-house — from Facebook ads to search engine optimization, web design, all that stuff. We also have a dedicated supply chain group which works with all our manufacturers.

We find entrepreneurs who have built something cool but are ready to proceed. We write them a check, and then we help the brand grow. We aim to be a excellent long-term home.

We own six brands currently.

Bandholz: What makes for a great acquisition candidate?

D’Alessandro: We search for branded consumable goods, something you buy repeatedly. We seek businesses with over $4 million in sales minimal. We adore brands with at least 50 percent of the revenue from the direct consumer channel, using Shopify, WooCommerce, or comparable.

There’s a whole lot of buyers who seek 100-percent Amazon brands. We are none of them. We would like brands that have a direct link to their customers.

Bandholz: Tell us how you have built your staff.

D’Alessandro: Again, we’re about 60 individuals with teams specializing in advertising, supply chain, logistics, finance, and human resources. We’ve got a deal man that does outreach. I used to do all those tasks.

When I started hiring people, I asked myself,”what’s the best use of my time?” I’m excellent at acquisitions. I’m also very good at digital marketing. I try to spend my time in these regions. Other men and women are better suited to logistics, shipping, accounting, fund — these kinds of skills.

So that is what I consider when hiring people.

Bandholz: You have busted through challenges for to six brands.

D’Alessandro: Among those challenges was moving from doer to director, from creator to CEO. That’s a jump that a good deal of entrepreneurs, myself included, struggle with. The skillset of a creator differs from a CEO. A mentor of mine described it as changing from managing by understanding to handling by reporting.

After we’re a small group, we are working hip to hip. We do not need a whole lot of reporting. But that does not scale. The majority of us can not afford more than five or six people nicely. So we must move from management by understanding to direction by reporting, so we put up structures to be given a sheet of paper each week with metrics on it. We’ve got qualitative talks about how the company is going — good or bad.

Bandholz: How can you locate the operations supervisor or an integrator that works with your eyesight and the many functions of the organization?

D’Alessandro: It is not easy. I talk to a lot of entrepreneurs who ask,”How do I hire an integrator?” What they really mean is,”How do I employ someone to run my business while I sit on the shore?”

But an integrator still needs the visionary. And the visionary’s occupation isn’t absentee. The visionary needs to be involved in the company, must lead the enterprise. The visionary is the leader who people look around. No one likes to work when the person they work for is on the golf course or the beach, so to speak.

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So it is a matter of understanding what we as entrepreneurs are good at and what the integrator is great at. The integrator takes over the areas of the business the visionary isn’t suited for.

Bandholz: Let us go back to the beginning of your company. Can you have partners?

D’Alessandro: I began the company with a partner. Our relationship is still fantastic. However, I bought him out about a year after we started. He chose to go to law school and get his MBA. He was not committed to the enterprise. I bought him out for $8,000. So, yes, I did briefly have a co-founder, but it was not Elements Brands then. It has been me the entire way. I raised some cash across the way in a few spots.

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Bandholz: What was the strategy behind the excess money?

D’Alessandro: By 2016, I had done a few acquisitions. We had three brands in the moment, and the company was functioning. It was rewarding; it had been growing. I owned the entire thing. However, I wanted to be larger. I wanted to create a major company. I felt like I was ready for more.

So I started talking to some investors, describing the potential of moving from three brands to five, 10, or 20.

Finally I raised about $3 million from some offices. They’ve been phenomenal sounding boards. They joined my board and attend our quarterly meetings. We talk about the financials of the organization. We examine acquisition opportunities, strategy initiatives.

So increasing the money ended up being a lot more. It brought in seasoned company-builders who have provided great advice.

Bandholz: You have sold three of your own brands.

D’Alessandro: Yes. It was a hard decision because we do not wish to sell brands. We do not buy brands with the intent to sell them. If we purchase a brand, we would like to own it for another 10 to 20 years. But our firm had evolved.

We possessed eight brands at the moment. Three of these were 6 percent of earnings in the aggregate. And it is the same amount of work to send an email to 100 people as 100,000 — a lot of their work in running an ecommerce business scales.

So we opted to market those three brands to entrepreneurs who may concentrate on them. They were too small for us.

Nurture My Body we offered into an energetic entrepreneur. I am excited for him. Then we hired a broker to choose the other companies to market. We offered them in 2020.

Bandholz: What were the selling prices?

D’Alessandro: About 3-times profit. I can not disclose exactly what we sold them for, but we offered them for market multiples. You may go on BizBuySell.com to determine where that is. Multiples have increased by roughly 1-times EBITA over the last year. Ecommerce companies are pretty fairly priced today — to buy or sell.

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Bandholz: Shifting the subject, you ran an ad that generated a million dollars in earnings. I would like a whole lot of those. So what is the formula?

D’Alessandro: there isn’t really a formula. Anyone that’s promoted on Facebook knows it is plenty of trial and error — throwing things in the algorithm, seeing what resonates, doing plenty of multivariant testing, figuring out which ad copy receives the lowest cost per purchase.

We do a whole lot of work in-house. We attempt to create what we call”thumb-stopping” advertising. Picture yourself scrolling through Facebook or Instagram with your thumb. We wanted an advertisement that at the first two moments stops your thumb, and it makes you go,”What the hell is that?” Or,”That is kind of interesting.”

Our million-dollar ad featured my eight-month-pregnant spouse in a sports bra. Readers are like,”Whoa, that’s a enormous belly.” That will prevent you scrolling through Facebook, especially if you’re pregnant, which was our goal.

We attempt to create thumb-stopping content that speaks to the viewers and drives them to a landing page which continues the story. In case you’ve got a specific model in the ad, insert her on the landing page, also, to keep the hook.

We’ll probably think of a handful of those ads in a year which scales to a few million bucks, but you can not do it using a formula.

And we are always advertising for conversions. Your product page is a landing page. If you are driving a great deal of traffic to your product page in the advertisement, tweak the page to resemble the advertisement.

Bandholz: Are you’re searching for a particular return on ad spend?

D’Alessandro: We use what we call a “contribution margin” ROAS. This is a massive trap for advertisers on Facebook. That amount, ROAS, is easy to get from the Advertising Manager interface. However, the amount is a trap because it is based on revenue, not profit. A 1-times ROAS seems like you are breaking even, but you are not.

Contribution margin is based on profit. We now have what we call breakeven ROAS, which ranges from 1.6 to 2.1, based on the brand.

Bandholz: Where can people learn more about you?

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