Purpose and Intentionality in Digital Marketing with Kevin Strawbridge

[00:00:48] Jamie: Welcome to the Profitable Performance Marketing podcast. I am Jamie Birch, your host and founder of JEBCommerce, your award winning management agency. Actually been managing well over 300 affiliate programs for 19 years. Just celebrated our 19th year, not too long ago.

[00:01:05] Now on today’s podcast, we have a special guest. I know I say that every time and all our guests are special, but Kevin and I have known each other almost our entire marketing careers. We met gosh, 23 years ago. I was at Coldwater Creek, he was at JCPenney.

[00:01:25] But before I talk to you about today’s episode, want to make sure you know, that if you are looking for affiliate management services, head on over to jebcommerce.com/elements, and you will find all the tiers and levels of service that we can provide everyone. Everything is available from just needing to make sure things go smoothly all the way up to that top shelf white glove service we have put together.

[00:01:51] Several different packages so that you can see with complete transparency, exactly what you’re getting for the money that you’re paying and everything in there. We’ve noticed that in the agency world, there’s been a lack of transparency in that regard. We want to bring that to our clients. So if you are an advertiser and you’re looking for affiliate management help, definitely head over to JEBCommerce.com/elements and check out what we have for you over there.

[00:02:17] Now, Kevin has been on every side of the affiliate marketing space. He’s been with an in an advertiser, one of the biggest JC penny. He has been the CEO of an affiliate network ClickBank and he has run his own websites as well as was the president of DealTaker, one of the premier coupon and deal sites.

[00:02:41] He also, in addition to that unique perspective ran a program that didn’t allow coupon affiliates in and then ran a coupon affiliate. Talk about someone with a unique perspective. So if you’re struggling and wondering what to do with coupon sites, you definitely want to listen to this episode, but Kevin has an accounting background and is really unique.

[00:03:03] And we talked today about building the case for the affiliate channel within and how he did that at JCPenny and how he’s done it everywhere. And I really think there’s a whole lot of value for the affiliate marketing industry on how exactly he did that. There’s a ton to learn here, in addition to building a case study for the channel, but just how things work and the pillars that he used in his career and the goals that he set, but one of the things that Kevin talks about is purpose and intentionality. So definitely give a listen to that. I’m going to get out of the way so you can listen to my conversation with Kevin Strawbridge.

[00:03:38] All right. Kevin Strawbridge. Thank you for joining me. One of the true OGs in the digital marketing space, probably closer to the big bang of digital marketing… actually I know it’s closer to the big bang of digital marketing than I was. It’s not often we get someone on here that has been doing this longer than I have, but you definitely have been doing that.

[00:04:00] Welcome to the profitable performance marketing podcast.

[00:04:03] Kevin: Thank you very much for having me. I really look forward to it.

[00:04:07] Jamie: Yeah, and I appreciate you not wearing all the Dallas stuff tonight. I’m not looking forward to this game in any way as they play the Seahawks.

[00:04:14] Kevin: Hey, I’m a Seahawks fan. I grew up in Seattle, so I went to the first ever Seahawks game in the Kingdome and I’ve been a fan ever since. So, I live a mile and a half from the Dallas Cowboys headquarters and I just kind of avoid these people as much as I can.

[00:04:28] Jamie: Well, not to alienate everyone who follows America’s team, but I got to see a couple games in the Kingdome, but my Kingdome story is watching Michael Jordan play the Sonics in the Kingdome and I believe I was close enough to touch the Dome, so really all you saw were Dots running around the floor way back in the day.

[00:04:50] Kevin: Very nice. Well, I will say, I gotta add this though too. My highlight in the Kingdome was getting to see Pelé play when the Cosmos came to play the Seattle Sounders. So I got to see Pele play live, which was pretty amazing.

[00:05:01] Jamie: That would be pretty cool. My wife and I, if we want to go see a game in Dallas because of the stadium, if there’s a concert or there’s a game with a hall of famer we definitely want to go see that. I’ve got to see Bo Jackson and Jordan, so definitely want to see that. I interned in Seattle when they were building Safeco, so I got to take the bus right by every day as they were building and testing the retractable roof. But we, we both, where, whereabouts in Seattle did you live?

[00:05:30] Cause I lived South Puget Sound in Sumner.

[00:05:33] Kevin: So I was in Bellevue, I was on the other side of the lake.

[00:05:36] Jamie: Okay. We played them in lacrosse, got beaten pretty regularly by that high school team for sure. Well, awesome. I…

[00:05:43] Kevin: Gone to new, I would’ve gone to Newport High School, not Bellevue High School. But…

[00:05:46] Jamie: Gotcha. Gotcha. Well, thank you for joining us there between the two of us. There’s over 50 years of experience in digital marketing and really want to dive into, you have some really unique experience that we haven’t had on this show yet, so excited to get in there, but why don’t you walk us through?

[00:06:03] And for those that don’t know you, how did you get started? How did you find digital marketing and what’s been your career path?

[00:06:10] Kevin: Yeah, it’s interesting. When I started college I started off as an advertising major. I really just enjoy the idea of being creative and coming up with taglines and really being a branding and marketing person. Found out very quickly that I didn’t really have the graphical art skills and the artistic part of being an advertiser, so I had a professor that kind of shuffled me off to a different direction and I ended up in accounting of all things. I found, I really like numbers. I’m very…

[00:06:36] Jamie: That’s a dramatic difference from the…

[00:06:38] Kevin: It is. Usually you go the other direction, but I ended up in accounting, graduated. I got a bachelor’s degree and a master’s degree in accounting.

[00:06:45] So I did the five year program at Texas A& M University, and from there I got into auditing and did audit for two years with Deloitte, which was a great experience. I got to learn how companies sort of look back on what they’ve done in the past. I shifted gears from there and went and worked for a restaurant group as a corporate controller.

[00:07:02] So I learned how to do all the day to day operational accounting things. And then I ended up in management consulting. What’s interesting about the accounting stop was when I was in college, I made the decision that I wanted to be a CEO or I wanted to start a company or run somebody’s company someday.

[00:07:16] And I knew if I had the finance and accounting background, I would always feel like I knew what was going on as opposed to somebody telling me something and just having to take them at their word. And that has served me very well in my career. Then I ended up in management consulting with Pricewaterhouse, which became PricewaterhouseCoopers while I was there.

[00:07:32] And there I got to learn how to take companies apart and put them back together again. But the best part about being at PWC was when I got pulled onto a team for what’s called the technology forecast, and I specifically got to work in the area of this burgeoning thing coming called e-commerce.

[00:07:48] And I had no idea what e-commerce was. This is 1998 to date myself, and I got to go back behind the scenes at MIT, Stanford, nordstrom, Macy’s, several other big department stores and talk with people about how they were going to embrace this thing coming called e-commerce and how they were going to move from a pure store or pure catalog play to this online piece.

[00:08:10] And so I got to learn and see so many different things that when I, when I got done at PwC, I moved into actually starting a dot com business in Austin called smartprice.com. Which was a long distance price comparison service for long distance telephone. So I learned then and there how important it was to be able to see and track data from a digital perspective.

[00:08:29] And that really just sold it for me. I was one of the first people doing SEO. I was one of the first people doing paid search, if you call it that, because back then there wasn’t a bid system. We could go own a word for a year for like $20,000. We just had to buy the word from Yahoo and we owned it for a year.

[00:08:45] It was our term. And before bidding came along and then I learned about affiliate marketing and we started some affiliate marketing stuff back in 1999 2000 and that’s when I first really got to touch affiliate marketing and the performance aspect of what that was. So from there transitioned through a lot of different roles, but you know stayed pretty true to multi channel commerce for about 20 years, working my way up into roles where I got to be director of e-commerce VP of e-commerce and marketing, ultimately became president of two divisions.

[00:09:14] And we’ll talk more about that, I’m sure in a minute, but one of them was dealtaker.com, which is an affiliate. Another one was a company called Motorsport Aftermarket Group, which where we sold motorcycle gear, parts and accessories, and then ultimately became CEO at a company called ClickBank, which is an affiliate platform.

[00:09:30] So I’m sharing all that just to say that along the way I’ve touched everything. I should mention to you, I ended up at JCPenney.com, which is where you and I met and JCPenney.com was my first true exposure to building out an affiliate program from scratch and doing some really unique things that we can talk more about however you’d like to.

[00:09:46] Jamie: Well, it’s interesting as you were saying that my dad’s words when I went to school are ringing in my ear of like, “go to accounting, get a financial background. You can learn the marketing aspect, you can learn these other things, but learning how to read financial reports and having that quantitative background is really hard to do on your own.”

[00:10:09] You know, it’s well before YouTube university and, I was just a couple of years behind you in that. I remember him saying that background is so vital. You’re the first person on this podcast that went to school originally for anything related to what we do in advertising, that’s pretty unique.

[00:10:25] But that shift to accounting, do you find that has uniquely positioned you against your peers to kind of take the career you had?

[00:10:34] Kevin: It really has. And so when I was at smartprice.com, I was in a role where I ran all the finance and operations for that dot com business, and I ended up in a business development role. I got recruited into a business development role at JCPenney.com, and what stood out about me to the president at the time that hired me is he said, “Hey, you can look at things empirically. I have a lot of people that can look at things creatively, but nobody’s looking at it empirically.”

[00:10:58] And I understood the idea of building a business case for something and being able to measure and track how we expect things to go and how things actually go. And then with those changes or those deltas that occur, how do we optimize those so that we can be able to do better as we go forward?

[00:11:14] And so it really has helped me to stand out. And even like when I was at JCPenney and several other companies. A lot of times the companies didn’t know how to deal with some of the things we did from a digital perspective. So for instance, affiliate marketing, as you know, is a performance marketing channel.

[00:11:29] And I had, when I first had to set up budgets for my affiliate program, they said, we need to know exactly how much money you’re going to spend for affiliate marketing. And I would say “well, we pay a commission on every purchase. So, if I do 10 million in revenue and we have a 6 percent commission, I’m going to spend $60,000. But if we get to 25 million now I’ve gone up significantly more and I’m spending a lot more.” And they said, “well, we’re going to have to cap you at that $60,000.”

[00:11:53] And so I had to explain to them and we, and we were able to do this when I was at JCPenney, because I brought the accounting doctrine to what we were doing is to say: let’s not put those numbers above the line, let’s put them below the line. So as we spend that money, it becomes more discretionary. So if I generate more revenue, which is more dollars coming in on the top, and I spend more in commissions, which is cents coming out on the bottom, we don’t have to mess with the budget on that because we’re getting a positive on both sides.

[00:12:20] And it was great because the then CFO said, “well, I can’t really challenge you on this because you have an accounting background. You understand what you’re doing.” And that really was one of those things that separated me from the pack in terms of being able to talk about and understand what we were doing.

[00:12:34] Jamie: Definitely want to dive into that because that’s a common problem that even after 19 years running this agency and working with clients, that question comes in and we have that conversation every single year with at least one client of “well, I need to know, I need to earmark, you have this budget, and when you’re done, we have to shut it down” and then going through that conversation.

[00:12:58] So I definitely want to go back, and I took a note, I would love to get your perspective on that because you’re definitely the only one we’ve had with that type of background and has gone through it in an advertiser which I think is really important. One of the things You mentioned is you had always wanted to become a CEO.

[00:13:16] And while we were preparing for this you definitely reached that, and then your view of it kind of changed a little bit. So walk me through first, like you crafted your career. So you, you knew where you wanted to go. How did that impact the positions you took, what you went to look for?

[00:13:35] And then when you got there, what was that view from that peak look like? Yeah.

[00:13:40] Kevin: as I was growing up before college, I got to meet a lot of interesting business people, and I met some CEOs, I met some vice presidents, I met people who ran divisions of companies, and one of the things that always stood out to me was these were people that understood things at a deep level across multiple things.

[00:13:56] So there were people that I knew that were very specific about things. They might know accounting or accounting only, or they might know marketing and marketing only. And I always noticed those people just moved up in their positions and then they capped out. And I always thought, I want to run something.

[00:14:09] I want to be the person that comes in and solves the problems and helps fix things. And what I realized was in order to do that, I have to do things with purpose and intent. And interestingly, it’s one of the things I tell my 17 year old son all the time, “do things with purpose and intent.”

[00:14:23] And that purpose and intent for me was adding tools to my tool belt. So anytime I could be in a situation where I would learn something new about how a company ran, or I got to observe how a process worked, or I had the ability to work with a team that I didn’t normally work with and see how they generated ideas or how they executed on things.

[00:14:41] It gave me more of an ability to create these tools that I could put in my tool belt so that when I got to the next level of what I was doing, either from moving from a staff level to a manager level or a manager level and up, or just moving from a company to a company to a company, I was able to bring these experiences together, and share them across the groups of people that I was working with. And it gave me more of a subject matter expert feel in the things that I discussed. But it also came with experience.

[00:15:07] So for instance, when I was at JCPenney.com I spent a lot of time up in Kansas City and up in Milwaukee at the fulfillment centers that we have. When I went up there, I didn’t just go sit in an office and work up there. I went out on the floor. I understood how the returns process worked, which everybody never pays attention to. I paid very close attention to how people put things into the bins that had to be then picked and taken and shipped to customers.

[00:15:30] And what was unique about JCPenney was essentially you had a bin and at these five fulfillment centers across the country, and there was a small little section within that bin that was JCPenney.com. And so like I learned these different pieces, the way people put things together.

[00:15:43] Then later on in my career, when I was the president for MAG, I was able to observe and understand we had a broken fulfillment process and I was able to step in and say, “Hey, I’ve seen these things in the past and learn these things in the past. How can we apply what I’ve learned to what we’re doing and do it better?” And so that all, when I started stacking all those pieces up, I call them the pillars, sort of the pillars of my career.

[00:16:05] Accounting was all about looking back and understanding the history of a company. Management consulting was all about taking things apart, putting back together again and creating value for shareholders and then bringing this operational expertise, even though I was in the dot com space, it didn’t keep me from wandering off and learning

[00:16:21] how does a catalog work? How does retail work? How do we print our newspaper ads and send those out? How does this fulfillment center piece work and tying all that back together? That gave me the credibility and the opportunity to really step up and be able to learn how to run a business and I got to work with some amazing CEOs along the way as well. Alan Questrom who was the CEO of JCPenney when I was there led a major turnaround effort at JCPenney, you probably remember it from your time at Coldwater Creek.

[00:16:45] That company was destined to go out of business then and he saved it. Now, ultimately they went bankrupt later on. That’s a whole different story. And we won’t even get into that, but watching how he really meticulously said, “this is the approach we’re going to take. These are the tools that we’re going to use, the execution we’re expecting, and the results that we’ll see.”

[00:17:03] I learned from that and I observed these people and then I was able to apply that to what I was doing going forward.

[00:17:08] Jamie: Now, where does that come from? Did you have a mentor guiding you? Was it that early networking with CEOs and they kind of told you, you had to have these pillars. Cause I see those pillars and it is very similar to what my family – and people who listen to the podcast, have heard this – my family was weird, this is the kind of stuff we would talk about.

[00:17:27] But where did that come from for you? Cause there’s a curiosity that I see in this story that I don’t know, can you repeat it? But did you have someone pushing you that this is what you need to do? Or did you just have that drive?

[00:17:41] Kevin: So I would say it’s a little bit mixed. And now you’re making me dust off a little bit of the back of my brain. My dad was my first mentor. I love, my dad was an amazing, amazing man. He was probably a genius. I don’t think he ever got tested, but he was probably a genius.

[00:17:53] He was a civil engineer in land surveyor, very meticulous about the things that he did, a very accomplished artist. He could write letters because he was a draftsman. He could write letters. Like it looked like a typewriter wrote them and I would watch these things and observe these things.

[00:18:07] And he would always challenge me: “what are you doing? What’s your purpose and intent in what you’re doing?” Then that translated into, I played sports when I was growing up. I lettered in four sports in high school. I played baseball, basketball, football, and soccer. And I was always disciplined about the training and the things I had to do and the ways that I had to execute in those sports to be really good at them.

[00:18:26] And that really set the baseline then. Then once I got to school, and again, I thought I wanted to be an advertising major and found out that didn’t fit. Then I said, “okay, Kevin, what do you want to do? Okay, well, I really like numbers. I like data. I like analysis. So I don’t want to go be an engineer.”

[00:18:42] I know this didn’t seem interesting to me. I didn’t want to go necessarily into IT type things, and even though I have learned how to program and COBOL of all things, I wanted to be around business and I just thought business was where sort of things were happening. And so I just, that’s what got me to the saying, okay, now I need to establish what are these pillars that I’m going to build off of.

[00:19:01] And again, my dad being a civil engineer and land surveyor, when he put in roads, they had to be straight. When they built buildings, they had to have a foundation where it could meet certain tolerances. And I guess I just picked up and observed a lot of those things. And then really started applying it from a business perspective as I went forward.

[00:19:15] And then to your question about mentors, I had additional mentors throughout my career as well. A little story about me that nobody knows. I worked for Lady Bird Johnson for two years, the former first lady, and she was an amazing business woman.

[00:19:28] And I learned so much from her about just how business works in a very unique setting, working directly for her. Then I had a gentleman that I worked for PricewaterhouseCoopers, his name is Tom Hughes, he saw that I was always chasing and trying to do these things, and he’s the one who sort of centered me and said, “let’s go learn what you need to do and do it really well.”

[00:19:46] Then we stayed together for about 10 years after I left PWC. He was always checking in with me, keeping me on track, asking me very probative questions, telling me when my ideas were bad, telling me when ideas were good and just kind of keeping me moving there. And then since then, I’ve just along the way, I’ve always picked up other mentors and coaches that have just poured into me. A lot of reciprocation there where we just help each other and we continue to move forward.

[00:20:08] Jamie: Are you enjoying the show so far? I sure hope so. You know, there’s been an awful lot of discussion over the last few years about the value of coupon affiliates. Maybe even you have doubted whether there’s value or not. Well, we at JEBCommerce wanted to find out. And the good news is the data is out there.

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[00:21:22] Simply for being a listener of our podcast. You can access this free ebook at JEBCommerce.com/value all for free. So thank you for listening. Now back to our show.

[00:21:36] Wow. So, lady Bird Johnson. That’s an incredible story. What was the biggest thing you learned from working for her?

[00:21:43] Kevin: Yeah, it was interesting. So she had Mrs….

[00:21:46] Jamie: This is our first connection to a former president for sure.

[00:21:50] Kevin: There you go. Well, her, one of her first business purchases was a television station in Austin, Texas, but way back in the day. Then she bought some radio stations, they had oil and gas plays, they had real estate plays she started the National Wildflower Research Center, and then they had the LBJ Library, which is, you know, a presidential library based in Austin on the University of Texas campus, and the biggest thing that I learned there was how to deal with a extremely large family business.

[00:22:16] So at the time, the LBJ holdings were probably about 150 million across these different properties that I just told you about. And it was a somewhat dysfunctional family. I mean, you had two daughters, Linda and Lucy, very, very different people. Lyndon’s obviously gone by this time. You’ve got other family members involved. You’ve got a governor of Virginia that’s married to Linda. There were a lot of things that people didn’t agree on, and I got to literally sit and watch how those discussions unfolded and how they had to find negotiated ways to get things done and how they had to appease one part of the family to make another part of the family kind of do what they needed them to do.

[00:22:52] And through that I got to see business transactions for the first time. Mrs. Johnson had bought a table system in South Texas in the early seventies. It’s called Karnak Table. She paid about $70-80,000 for it back in the day, sold it for $60-80 million while I was working with her, and I got to sit at the table and see the negotiations and the discussions around how those table systems were being acquired and what was being done.

[00:23:15] And then all the while I’m doing sidebar accounting on various and sundry different things. So I get to see all of the deals that are going through and the transactions that are going through for all this stuff, and it really taught me this is how business works. And from a family perspective as opposed to a corporate perspective different nuances of how we had to treat things.

[00:23:32] Jamie: That’s fantastic. That’s a great story and what a lesson to learn early on.

[00:23:37] You reached your pinnacle in your career, you became a CEO. What was that what was that achievement like? And what’d you learn about that goal? You, this is where you wanted to go. Was that like?

[00:23:51] Kevin: I’ve been a president twice so I almost got a little bit of a dress rehearsal before I got to become a CEO and when I joined ClickBank back in 2017 that was a company that had been around for 20 years. It’s an affiliate network that you may or may not have worked with, but some people have worked with them, some people haven’t.

[00:24:07] I’d worked with them when I was at DealTaker.com and a lot of respect for the company, very different product from mainstream e-commerce, and I learned very quickly that things change on a dime. And when you’re in command of the entire operation a lot more has to be paid attention to than just individual areas within a business.

[00:24:26] I got very quickly involved in helping to turn around some things that needed to be taken care of. Found out quickly that we need to spend more time with our customers. We need to learn what our customers wanted, how they wanted it. And then start to redevelop our team so that we could do what we needed to do.

[00:24:40] The things that I learned, good and bad, the good things that I learned were, I felt like I was really capable to be able to come in and run a company of that size, because of the things that I had done and the experiences that I’d had. But I also realized very quickly that I’m not an extremely political person.

[00:24:55] I tend to say what I think, and I tend to do what I think needs to be done, and sometimes more measurement needs to be taken in place with that. And so that leads to a lot of people pushing different agendas, both within the company, from a board perspective, from customer perspectives and really starting to learn that, “okay, I’ve got to kind of mature a little bit in my knowledge and my understanding of using knowledge to be able to. Serve everyone that needs to be served, but ultimately set the goals properly so that we can achieve our revenue and profit targets. We can keep our employees happy and make sure that they’re excited about what they’re doing. Keep our customers happy, but then also realize that there are founders involved or our board members involved. There’s expectations that go along with that.”

[00:25:37] And I would say that, leading up to becoming a CEO, even though I had seen a lot of different variations of how things could go I realized that the next time that I’m the CEO, I probably need to do a little bit more research and dig into some things and understand personalities more about how people operate, what the expectations are and how those can change, so that I can be better evolved and developed to be able to serve those things.

[00:26:00] So, I have not been a CEO now for multiple years. There was a period of time that I went through after I left that role where I thought, “I don’t know if I want to do that again. I, there’s a lot of responsibility that goes into running a company” and I’m not shy on that, but I also realized that with that responsibility, if you don’t have all the responsibility and all of the authority, it’s very challenging.

[00:26:21] So I would want to look for situations where I can have as much of the responsibility and as much of the authority as I can, not because I’m a control freak and I want to control what everybody’s doing, but I just want to know that if we’re going to put something in, we’re going to get something out that’s equal or better than what that is.

[00:26:36] That’s caused me to sort of pull back a little bit and start to look around a little bit more and realize I want the challenges that go with the leadership, especially the top leadership within a company, but I want to do it in a way that I know that people are going to be successful and they’re going to get benefit from that, not that we’re just moving things along.

[00:26:53] Jamie: Yeah, definitely, there’s lot more in managing the people around as you’re a CEO, than they teach you in college about, about management, I think.

[00:27:02] Kevin: Yeah, you can’t learn it in a book, and I mean, I’ve got a couple of books on my shelf about what it takes to be a CEO and I’ve read them and I’m like, “yeah, no, that doesn’t matter.”

[00:27:11] Jamie: Yeah, definitely. Let’s go back a little bit. One thing you and I talked about when you were at JCPenney, you had to fight for the affiliate channel and a lot of our listeners they may be the only one in the company that understands the channel and they have to fight for that.

[00:27:26] And I remember we were probably doing this kind of side by side in different parts of the country for different companies at the same time, as the channel got more exposure it got more oversight and critique and trying to explain to people who had no idea what we were doing, no idea about this model that it was valid, and we needed more budget and more resources.

[00:27:49] So talk to me about that time. What did you have to fight against and how did you manage that challenge?

[00:27:54] Kevin: Yeah, everybody has issues with what they deal with, so I’m not going to say that my issues are worse than anybody else’s issues were, but I will say that there were certain issues that we faced. Again, dating myself, I was at JCPenney from 2001 to 2004, the very early, early Wild West stages of digital marketing and dot com.

[00:28:13] And JCPenney was a leader. Once we built up the JCPenney affiliate program, we were the third largest affiliate program in the country at one point behind Dell and Expedia. And I love that because I was like, “Hey, I built this thing and it’s actually really valuable.”

[00:28:25] But I was also working at a company that turned a hundred years old while I was there. By the time I left, it was 102. I worked with a lot of people that had come up through the catalog ranks and I loved them all dearly. They looked at things very differently than we newcomers and non-retail people and non-merchants did.

[00:28:43] And so a lot of… yeah, exactly. A lot of my fighting wasn’t necessarily fighting for the affiliate channel. It was fighting for the digital presence at the table. Because what’s unique about JCPenney was JCPenney had 17 billion in stores. They had about 5 billion in catalog, and then they bolted this little thing called JCPenney.com onto the edge of catalog and called it JCPenney Direct.

[00:29:05] The year that I started there, we did about 188 million in revenue, just to put it in perspective. The year that I left in 2004, we did 824 million in revenue. A lot of what I had to fight for was the seat at the table, access to dollars, access to resources so that we could build the things that we thought could truly get JCPenney to where it needed to be from an online perspective.

[00:29:26] The good thing is, is when Alan Questrom started, he said, “I believe in the digital channel, but I’m not going to pay any attention to it.” So we were kind of off over on this little sphere on the side of catalog getting to do a lot of what we wanted to do, but the catalog people that were involved said, “Hey, we’ve never done it this way before.”

[00:29:42] And I’m like, “I totally understand this has never existed before.” So the affiliate program got launched and it was on autopilot when I got it and took it over. It was not run well. I think they had, they built it up to like 1600 affiliates that they were working with, 20 of these affiliates actually produced anything of substance that from a revenue perspective.

[00:30:01] So I went in and in order to get the people that I worked with that had come from the catalog that we’re working with JCPenney.com to appreciate what we were doing I said, “hey, we’re gonna overhaul this thing. We’re gonna do it differently.”

[00:30:12] And so I basically held town halls with people and said “what are your expectations from a program like this? That will help benefit JCPenney, but will also help us to grow our revenue.” And immediately the catalog people came in and said, “get rid of all the coupons,” but we’re a couponing company.

[00:30:28] Like they’re in the store, they’re in the catalog, they’re online. Really what it came down to was stop letting people use our catalog coupons on the website. And I was like, “I can take care of that.” And we actually went in and turned off all deals and coupons. And you’ll probably laugh about that.

[00:30:46] Cause I ran a large deals and coupons website. We turned them all off at one point.

[00:30:50] Jamie: We’re going to talk about that too.

[00:30:52] Kevin: Yeah, we turned it off at one point because even though we asked nicely, we said, “Hey, please don’t post these. I’ve got people that I’ve got to deal with and make this work, people kept posting them.”

[00:31:01] I won’t name any names and they probably know who they are if they’re listening to this. But we ended up having to turn them all off, and then we still had people that continued to post coupons from the catalogs on the website. So, at that point, I said, “okay, from the town halls, the other thing I heard was, we’ve got all these people throwing our links up all over the web and we can’t control it.”

[00:31:19] I was like, “I understand that. That totally makes sense.” So we came in and we pared down the program to no more than 200 affIliates. So we got rid of 1400 affiliates and…

[00:31:29] Jamie: Was that number of the goal or it just happened to be under 200?

[00:31:33] Kevin: No, I targeted that goal at 200 and I’ll tell you why in just a second. One, it was a little bit easier to manage, but two it was meaningful from the perspective, like I said, only about 20 percent of our affiliates are active and doing anything. So I figured it about 10 times that I could pull that off, but 80 times that I couldn’t, so I was like, I’m just going to leave that alone. And so with that, I created a program where I called it, I’m a big English soccer fan, so I created a relegation and promotion system within our affiliate program where we created essentially what was a premier league.

[00:32:05] And that was the top 20 affiliates that were actually active and producing for us. And then we had the next tier that was about a hundred affiliates. And then there were 80 affiliates at the bottom that really didn’t do anything, but they were at the bottom. And then we set our commission structure up appropriately so that the top tier was getting higher commissions.

[00:32:21] The middle tier was getting lower commissions. The lowest tier getting lowest commissions. But what that allowed me to do then too was as I’m working with the people in the catalog and even with the store, some of the store people, they said, we’re spending too much money in promotions around affiliate marketing.

[00:32:33] And I said, well, “then what I’m going to do is I’m going to, I’m going to change the commission structure to where we’re going to only pay commissions and we’re not going to buy ad space anymore. And what we’re going to do is if you’re in the highest tier, we’re going to pay you a bump on the commission for placement in certain places.”

[00:32:47] And then everybody said, “Hey, that’s fine because we don’t have to pay anything unless they actually get a sale for us.” And I said, “great, now you’re getting it. You’re understanding performance marketing. This makes sense.” And so if you were in the top tier… I’m trying to remember the numbers off the top of my head. I think it was 8 percent was what we were paying in commissions at the time, which was probably huge compared to now. And then it dropped down to 5 percent and then 2 percent in the bottom tier.

[00:33:08] And I would have people in the bottom tier come and say, “well, you need to pay me for ad space. And I’d say, “well, tell you what, why don’t you go drive some revenue for us and get yourself up in these tiers and you’ll make more in commissions.”

[00:33:17] It alienated some affiliates, and I understand that, but internally I got a lot of people on my side because they said, “you’re using performance marketing for the purpose of performance marketing.” They started buying into that and saying, “we support this. We want you to do more of that.”

[00:33:31] By the time I left JCPenney, we were at about $77 million in revenue that was going through the program, which is pretty strong considering we’re $824 million in overall revenue. And I wouldn’t have gotten there if I didn’t get the buy in from the other people that were involved.

[00:33:43] And then the beauty of this was, as they were seeing these top performers performing well, the merchants would start kind of nosing around my cube saying, “Hey, how can I get my product onto this website? Because it seems like they’re doing well.” I’d say, “well, what do you want to sell?” And we would talk about it and I would go and say, “let’s make a pitch.”

[00:34:00] And I would bring them into the conversation with the affiliates, and say, “here’s what we want to do and why we want to do it. And all of a sudden we’re building partnerships.” And that’s the biggest thing that I will say that came out of what I learned with JCPenney was I always refer to affiliates as partners and partners are 50/50.

[00:34:15] If a partner is trying to take advantage of another partner, it’s not a partnership. And so we always worked on ways that we could develop these relationships, but it was funny, but I’ll leave you with this on the JCPenney piece: I had a lot of detractors out there too, people that would go out… what was it ABestWeb that had the forum back…

[00:34:30] Jamie: oh, yeah. Yeah. Yeah.

[00:34:34] Kevin: I had some people that would rip me up one side and down the other. “Kevin Strawbridge kicked me out of the JCPenney program. It’s not fair. I can’t believe this, blah, blah, blah.” And all of a sudden, other people started popping into the forum saying, “Well, you know, he told you exactly what he was going to do.”

[00:34:48] ” If you post catalog coupons, they’re going to kick you out of the program. If you do X, Y, and Z, they’re going to kick you out of the program. So, you need to leave Kevin alone and you need to follow the rules that were set because that’s a very lucrative program and you can make a lot of money.”

[00:35:00] Kevin: And so it’s funny, I was like watching the tennis balls go back and forth and I was like, ” I’m a tennis ball, but this is kind of fun to watch.” So, yeah.

[00:35:08] Jamie: I remember that for um there were many times that yeah, we both got lit up. I was cornered in the bathroom of my first conference I ever went to as like an adult and someone was giving me a whole bunch of grief about something I said on that forum and how I was running the program and I’m there in the bathroom. I’m like, “I don’t think this is appropriate.”

[00:35:30] Fond memories of that forum. But the one thing, when I was there at the time, I think the mistake that I made with that same situation, I was very young in my career, this was my second job. My first one was in the dot com field. It was my third gig out of college. So there was a maturity that hadn’t developed yet, and so I entered all those conversations with a lot of fear and it sounds like you entered it in with a lot of openness of like, “Hey, catalog, what do you expect? Retail, what do you expect? Accounting, what do you expect? And did a sort of a listening tour.

[00:36:10] I’m thinking of the Zig Ziglar quote of like, “you can be successful if you help enough people.” And it sounds like that’s the tack I wish that I had taken back then. But you went and had those town halls and opened that up, and that really sounds like it made quite a different experience than I had originally.

[00:36:28] Kevin: Yeah, you know, it’s interesting. I appreciate you use the word “fear” because it’s easy to say you’re fearful of something, especially if you’ve got a leader in your company saying, go produce this, or you’ve got a customer saying, go do that. Or you’ve got an outside person that can help you from an affiliate perspective or digital marketing perspective in any way go do this go do that. And I think when I was a PricewaterhouseCoopers I learned how to be a management consultant and the number one thing that we were taught was learn how to assimilate with the team. If you learn how to assimilate with the team, you’re a part of the team. If you come in and try to oppose the team you’re not a part of the team.

[00:37:04] And so I’ll never forget one of my favorite people, I’ll leave her name off this in case she does listen to it cause we still keep in touch, first day I met her, it wasn’t a good meeting. The second day we met, it still wasn’t a good meeting. Over the course of three and a half years, we ended up working very closely together.

[00:37:18] And the day that I left, she goes, “I can’t believe you’re leaving.” And, it was one of those things where it’s like, yeah, “I get it. I’m, I’m not the retail guy. I’m not the guy that has been at JCPenney for 30 years doing the merchant’s role and all this other stuff, but I am very interested in JCPenney.com being successful or I wouldn’t be working here.”

[00:37:36] I really want to see merchant, your products being sold, and I want to see your merchant products being sold, and I want to see our marketing be amazing where people appreciate it and understand what it is. I want our programs to be really successful.

[00:37:47] I had to get out of the way of myself, and then allow those things to start to take place where everybody wanted to partner with what we were trying to do and make it work. We had a Thursday morning meeting when I first got there, and it was the marketing and the merchant team. Marketing would come in and sit on this side of the room, on the left side of the room, and the merchant team would sit on the right side of the room.

[00:38:06] And they didn’t really talk to each other. And by the time I left, everybody was in these little pockets of people talking about the things they need to sell and what they need to do and how they need to mix marketing and merchandising and make it all work. And it was just fun just watching that organically happen.

[00:38:20] And, not everything, obviously I’m pointing out some of the successes we’ve had. There were a lot of yelling sessions we had in meetings, too, where people said “that will never work and we’re not doing this and you go, go away.” And we go away, right? And we had to figure out other things and other ways to do things.

[00:38:33] So…

[00:38:35] Jamie: You know, I love that. It’s such a good lesson for really anyone in, in, in any channel to take from is that cross channel work, and that was always a conflict. And it is now with many of our clients where they’re struggling internally and there’s a lot of fiefdom protection within that.

[00:38:51] I know at Coldwater, we had an initiative at one point to renegotiate all contracts to try and lower our costs a certain amount every year, and all the departments were involved. And that was the first time we all started to talk to each other.

[00:39:06] This guy had a little success and she had a little success and we started to work together. I think one of the biggest things that come out of that is we actually started to work together in these different departments, but for those listening, if you’re struggling with this, understanding everyone’s position, and like you said learn how to assimilate with the team instead of from a posture of defense, and I need to control and protect everything I have, coming at it from this company needs to be successful and we need to work together and tell me what you think about it. It’s something, it took me much longer to realize, but now we do that with our clients where we’ll get on with the search team and with the other teams…

[00:39:46] what do you think about this channel? What do you expect? What don’t you want to do? Did you know that this is some of the things that we can bring and the channel can bring, and those tend to be much, much healthier relationships. Yeah.

[00:39:59] Kevin: it’s interesting, too. I won’t say that I’m pro work from home. I’m not pro hybrid. I’m not pro work in the office. But the other thing I’ve seen that COVID’s kind of created, and I’ve seen this just observing from afar, because I’m not working currently on any teams, is I saw those silos at JCPenney.

[00:40:14] I saw those silos break down and people work together, and I saw the amazing things that came from that. I saw a lot of silos come back with COVID and people being sort of distributed again, and my hope is that we’re going to start to see some of those walls come back down.

[00:40:28] And again, it can be through a camera, it can be through an onsite experience. It can be through meeting at a coffee shop in a hybrid way. I’m not like, so I’m not pushing any of those angles, but you know, I think we’ve lost a little bit of that and we need to get some of that back. And I think we’re seeing some of that bumpiness showing up in the e-commerce channel where. Even though e-commerce e-commerce is recessed again where it’s not as it’s not peaking like it was during COVID. It will continue to grow again, and it will grow at a strong rate I never think e-commerce will be more than 50 percent of retail but it will grow again, and I think we’ll need to see some of those silos coming down and people talking and working together in order to make that happen.

[00:41:03] Jamie: I’ve seen that too, and I’ve seen it where I think it’s worse than it was before is there’s individual people silos. As a CEO, those things don’t fall down with two things that you mentioned earlier, purpose and intentionality. If you’re a leader right now and you don’t have that as part of what you’re doing is to bring those silos down, bring people together.

[00:41:24] And that’s not part of an intentional plan, they’re going to be missing out. So what you said, purpose and intentionality comes in that as well. That’s what I think.

[00:41:32] Kevin: Yeah, and it all starts with communication. Communication seems to have its peaks and valleys over time. And sometimes we see a lot more of it and a lot of times you see a lot less of it. Even when I joined ClickBank I was surprised when the accounting and finance team didn’t get all of the departments together to talk about their budgets on a monthly basis.

[00:41:49] And once we started doing that, people realized, “Oh, wait, you’re spending money on that? We’re spending money on that.” You start to uncover things and people are talking and then all of a sudden, “wait, we want to hit a profit number so we get bonuses.” Yeah, let’s scrub this a little bit better and let’s work together and figure out those solutions.

[00:42:05] Jamie: Yeah. So you have a really unique perspective on the channel: running a network, you’ve been a consultant, you’ve worked at a coupon site. You’ve been in an advertiser and a really well known advertiser, you’ve run your own website. How does that change your perspective on this channel, affiliate marketing?

[00:42:26] Kevin: Well, I mean, I think if anything, my appreciation for affiliate marketing grows exponentially with each piece that’s added. When I was just the merchant or the advertiser I did appreciate our affiliates, but I probably didn’t appreciate our networks as well because we were giving them money for who knows what. But this is back in my day of JCPenney, a hundred years old, like “we’re an amazing brand in the United States. Why do we have to listen to anybody?” I started to realize, okay, wait, they do actually provide traffic and access to affiliates and the ability to create these opportunities.

[00:42:53] So that started that, that was the first piece. And then when I moved over and was running DealTaker.com, which we grew into the 15th largest deals and coupons website in the United States, I realized that all of a sudden I’m the bad guy in some scenarios. JCPenney still did not work with deals and coupon websites.

[00:43:10] When I joined DealTaker, I ended up getting on the phone with somebody over there and I said, “look, we want to be one of your deals and coupons websites, we don’t do deals and coupons websites. Why not? Somebody made a decision a long time ago that we shouldn’t do that. I said, yeah, that was me.”

[00:43:24] I’m getting a little bit facetious about that, but I said, “look, here’s the deal. We can bring you value there. There are things that we can do for you that you can’t because you’re now 110 year old company, that’s probably slowing down on too many fronts, but we can go find new customers for you.

[00:43:39] Now, whether you keep those customers and get them in and retain them through your own marketing means that’s up to you. But from acquiring customers, give me a deal on coupon and then some sort of exclusive offer and I will get you customers that you probably don’t think you can get” and it worked and so we ended up becoming an affiliate to JCPenney, which was a lot of fun.

[00:43:56] We didn’t, we got a very small commission, but it was what it was and we broke down on that and I found myself a lot of times talking with more retailers about we want to partner with you. When I was the retailer, I wanted to partner with them. And so all of a sudden now that next exponential piece was adding on.

[00:44:13] Then when I was at the network side with ClickBank, I realized that being able to put these relationships together where we could find the right affiliate for the right advertiser, and really see the magic happen when those two things came together and then they started building on other things, it just felt like everything was coming full circle and there was a lot of unique opportunities and ways to be successful.

[00:44:34] People ask me a lot of times, ” which one did you like better? Did you like being the merchant? Did you like being the affiliate? Did you like being…” you know, it’s funny, I liked little pieces of every one of them to the point where I’m not going to say they’re equal, but I’m not going to, I’m not going to name one out, but I love being at DealTaker.

[00:44:48] Being a super affiliate is an amazing thing, right? When you’re going to do events and people are saying, “Hey, we, we want to work with you so bad. How do we get some of your traffic?” That’s amazing, but when I was at JCPenney and people were coming and saying, Hey, I want to be one of your affiliates.

[00:45:02] And we’re like, “well, we’re closed right now. We’re not opening up to any new affiliates.” “Well, what can I do? What can I do? How can I get involved?” That’s nice, and there’s a great feeling, but you realize again, it comes back to that business perspective. It’s that understanding of the purpose and intent of what you’re trying to do.

[00:45:15] And so when I ended up at ClickBank I loved being in the role that I was in. I loved the time that I was there. I left obviously for a reason, but at the same time, I knew that we were producing things. We were making beneficial things happen for people.

[00:45:28] Whenever it felt like something beneficial was no longer occurring. That’s when I lost a lot of interest in things and it just didn’t it didn’t feel the right the same way.

[00:45:37] Jamie: Yeah, and so talk to me about that coupon site because it is an interesting take. You were at an advertiser that was like, no, and then you ran one of the top super affiliates. We worked together many of our clients with DealTaker and so, looking back, after you’ve had that experience at a coupon and deal site, did that give you a different perspective on building a case to get the benefit of working with that partner?

[00:46:02] Kevin: Yeah, it really did. So DealTaker was very unique. First of all the gentleman that started DealTaker was Neil Rapaport amazing guy. I love how he started DealTaker I love the origin story of DealTaker. You know, he ended up selling the company to a company called Media General. Media General was a major media company on the East Coast that owned television stations, newspapers, and they were building this burgeoning digital platform.

[00:46:23] And part of the deal was they wanted to hire a president to come in. So they hired me because I’d worked at a merchant. I had an accounting background. I understand how to assimilate companies with other companies. And I fit from that perspective.

[00:46:35] And what was unique was then when I had the conversations with the merchants and the advertisers, I was able to talk about the traffic that we had and the value that we brought from that traffic. One of the biggest things about DealTaker, we were amazing at SEO. And that all started with Neil. Neil did a phenomenal job of setting up a community platform with really strong SEO functions to it.

[00:46:55] At one point in time, we ranked for over 400, it was like 475 plus sites, where if you concatenated store name plus deal plus coupon plus promo code, whatever, ranked number one for that term. So, of course, we got a lot of traffic just because we were good at doing that.

[00:47:11] That’s where I had to go back to the merchants and the advertisers and the retailers and say, look, ” you don’t rank number one and I’m not giving up that spot. We worked really hard to get that, but there’s no reason why you can’t get a benefit from that.” And so my case went from, “okay, I understand that you’re depreciating the value of that customer because you’re paying a commission to somebody that you don’t feel like you should have to pay a commission to, but what if we don’t rank number one and you don’t rank number one, but your competitor ranks number one?”

[00:47:39] And now instead of somebody landing at Nordstrom, they’re going to Macy’s instead because they can click that link just as easily as they can click any other link. And all of a sudden you can see light bulbs pop on and say, “okay, that makes sense. And I said, I get it. You don’t want to pay us a lot of money. Don’t pay us, don’t pay us the same commission that you’re paying everybody else, but allow us to be a part of that stream. We will help you acquire customers. Now you go retain them.”

[00:48:00] Those conversations became a lot more interesting because people understood what the value was that we were bringing. No longer was it, “Oh, we’re just paying a commission to these people.” It was, “they’re bringing us customers.” And that goes back, that really harkened back to my, one of my experiences with JCPenney we haven’t talked about. I launched JCPenney on the merchant’s app platform with Amazon. That was the predecessor to Amazon Marketplaces.

[00:48:22] So we were the first, one of the first major retailers to launch on the Amazon platform. We built a relationship with Amazon to the same degree where we said, “look, we think we’re beneficial for you and you think you’re beneficial for us. So let’s work together.” We bounced our files against one another at the time.

[00:48:37] We only, we found out that only 5 percent of our files matched. So Amazon had their client base and JCPenney had their client base, even though JCPenney was within 75 miles of 95 percent of the U. S. Population based on catalog desks, stores, whatnot. Yet our file only matched up 5 percent with Amazon.

[00:48:55] So we went and did this deal with Amazon. Sort of keep your friends close, keep your enemies closer. Kohl’s was getting ready to launch on the Amazon platform as well. So we went out there, and we were able to acquire customers at a much cheaper cost, actually, than some of the JCPenney customers we were getting.

[00:49:07] And so I took that same principle and I applied it to what we were talking to retailers with from a DealTaker perspective, and we said, “look, we’re not taking your business. We’re here to help your business. We’re going to make some money along the way, and we’re going to create more benefits for a lot more people, but we’re working together on this.”

[00:49:23] Jamie: And do you think that overlap in audience, do you think advertisers even look at that and do affiliates not do a good job of showcasing that? There’s been a few partnerships where we’ve been able to run and say… both of us coming from catalog background, we know about how those matches go.

[00:49:41] We know that there’s probably many times where JCPenney and Coldwater Creek match those files and shared names. It’s pretty common in that field, but it’s not in a lot of these other things. Do you think that overall impression, is it just an emotional feeling that they feel about coupons or is it… I don’t know. I asked like nine questions, not fully formed out.

[00:50:04] What do you think about that? Yeah,

[00:50:06] Kevin: It’s interesting. When I, when I first this was back when I was at PWC, I was working on a client, I won’t say who it was, but they were a client that had for decades, had never touched the coupon space. And it was a retailer and they decided one day, “you know what, let’s run a coupon.” While I was there and it was fortunate that I got to experience this and they ran this coupon and then they turn the coupon off and all of a sudden the business went away. They’re like, “wait a minute, so we need to turn the coupon on again.”

[00:50:31] Now a lot of people refer to it as the pizza shop coupon classic scenario, where if you don’t have a coupon, you don’t have any business. I mean, I can tell you, I can throw a rock and hit so many different restaurants around here that, “we’ll eat there if they have a coupon and we won’t eat there if they don’t.”

[00:50:44] And so trying to talk retailers through that aspect of one, you’ve got to be much more strategic about your discounting process. I mean, JCPenney died because they didn’t understand how to get out of their discounting strategy, ultimately. I wasn’t there when it happened, but there are other companies that I don’t think embrace the opportunities for promotional strategies to acquire customers.

[00:51:05] And again, if you’re using discounts to retain customers, there’s a problem. In that sense, it means your product is in the quality of what you’re doing is probably not good enough, but if you’re trying to, if you’re trying to find a customer for the first time, sometimes you’ve got to spend a few bucks to do that.

[00:51:18] And that’s what those conversations would ultimately come back to is, ” what are you willing to invest to get a customer? And then what do you want to do to make sure you retain that customer through quality service, whatever you want to describe?” You know, JCPenney, we keep coming back to that, but I work with several other companies along the way.

[00:51:33] Motorsport Aftermarket Group, we own J&P Cycles and Motorcycle Superstore. J&P Cycles was our premier brand. We didn’t discount on that very often. Motorcycle Superstores was all deals all the time. Out of Medford, Oregon, by the way which was funny because that’s where so many different e-commerce companies are, and so they learned very quickly discount discount discount.

[00:51:52] Well, they became a discounter motorcycle gear parts and accessories company Whereas J&P was his premier brand and so fast forward when we had to figure out an Amazon strategy Motorcycle Superstore went on Amazon, J&P we kept away from it because now we can start to protect those brand angles. And they’re, it was smart, like with JCPenney, with other companies I’ve worked with, sometimes there were brands that you protected and just said, “Hey, we’re not going to touch this brand. We’re not going to, we’re not going to discount this brand. We believe in it. There’s quality, there’s service, there’s background on it.”

[00:52:19] And then there are other things that said, these are basics. Anybody can go buy them anywhere. Let’s make sure we get our sales and make sure that we, from a yield perspective, we’re continuing to get good margins on these basic products and continue to augment and accentuate our offering so that all of our business lines could do well.

[00:52:34] Jamie: Your accounting background and getting back to the quantifiables is a common thread that I see in what you’ve done and what successful clients of ours have done getting away from the emotional, “I don’t want to work with coupon sites because they’re garbage,” but actually go out and test, see what you are getting.

[00:52:51] Are you getting new customers? What’s the cost of those new customers? How is that working within your whole global channel? One of the things that I wanted to dive into while we still have time is the concept of budgeting.

[00:53:04] We get this question a lot, the finance team will say, “how much are you going to spend this year?” And your performance marketer is like, ” as much as I can, it’s a percentage. So I want to blow it out. You know, we do our forecasts and we try to get there, but it’s not a channel you can shut off.” There are people and partners on the other side of that, it’s very difficult to bring them back if you have to shut down.

[00:53:28] So how did you work with your finance team? How did you build that case? How did you get them out of, “you can only spend this and then we shut that off.” You’d said a little bit about it, but can you dive into a little bit more?

[00:53:41] Kevin: Yeah. So, first of all, we always had a discussion around, “what do we think this channel is going to be as a percentage to our total sales,” because that way I could sort of appease… like the second year that I was at JCPenney, our target was to get to $250 million in revenue. We ended up at like 410, which is funny. Back in the good days of hyper growth.

[00:53:58] So at $250 million, I made the business case that we could probably get to about 8 percent of that in affiliate sales. I did a lot of financial modeling around that. I said, “here are the products we’re going to sell.” We literally had merchandise by month. Promotional cadence by month. So I could say, “here’s what we expect to happen.” Then I would bounce that off the catalog because the catalogs were amazing at budgeting because they had a book that came out the same time every year.

[00:54:26] Jamie: By day they could budget.

[00:54:29] Kevin: They knew that book was going to produce roughly X number of dollars. It was uncanny to me how close they always were until they started to die, and then people were like, “what happened? Why are we down 30%?” And so I would balance my numbers against the catalog piece.

[00:54:43] What I didn’t know, and one of the things I didn’t account for was, the online change for us was incredible. So, when I joined JCPenney.com in 2001, 75 percent of our orders were people with a catalog that typed in a lot number on the website and bought something. That was huge. By the time I left, and we called that EOB, electronic order blank ordering, and then by the time I left, 75 percent of the people were browsing the website and shopping online and making a purchase.

[00:55:10] We called that TOL or true online. So we completely inverted the model, and right in the middle of that two years, that inversion was happening. So all of a sudden, these numbers that I’m putting forth that I’m saying, “you know, I think we’re going to be $30 million this year.” It was $41 million, and even though they threatened to shut me down, I just had to keep going back and making the case.

[00:55:29] If somebody spends a dollar and then we spend six cents after that because we were at six percent average I said “that’s a good thing, right? I’m pushing our top line, you want to beat our top line number.” There were times we had to turn off products. We had to turn off we didn’t turn off affiliates necessarily, but we would start to turn off products But that happened in the catalogs too.

[00:55:48] If an affiliate got mad because they said, “why are you turning off this good performing product? I’m like, cause it’s a good performing product.” We have to buy out in certain periods of times and the catalog is going to get priority because they’re five times bigger than we are.

[00:55:59] If they start to oversell, they’re going to pull from our inventory. I’m going to have to say, we can’t sell those products anymore. And so we would get into these really interesting discussions. Part of that goes back to the part of the reason why I brought the affiliate base down to a much smaller number, because I could go have those one on one conversations with as many people as I wanted to.

[00:56:16] When it was 1600, I’d have to send out blanket emails to people and just hope that they weren’t mad. Whereas of the 200 affiliates, I probably talked to at least 150 of them a year easily. And then occasionally the other ones.

[00:56:27] It was a lot of education. It was me having to go to the CFO for my division and say, “Hey, I know this is different than what you’ve done before, but here’s the accounting process and what this will look like. Literally, this is what the journal entry should be. This is how we should account for it. This is where we should put it in our budget.”

[00:56:44] And once I showed them these things and showed them, we had a command of managing the revenue and managing the expense, their biggest fear was “always your expenses are going to get out of control.” And I’m like, “if they get out of control because my revenue gets too big. That’s not a problem. That’s a benefit.”

[00:56:59] And then they would say, “Oh, you’re right. That makes sense.” Because we were at the day, affiliate was actually one of the most profitable channels from a marketing perspective as well, because we were able to actually control our costs as a percentage of the overall revenue.

[00:57:12] Jamie: There’s so much in what you just said and that, knowing that they’re looking at that bottom line or they’re looking at that line item of cost, your costs are up. Okay, well, let’s redirect back into the whole picture of what’s going on. But again, purpose and intention is what I’m seeing there and not hiding and waiting for these problems to come about.

[00:57:31] I see so many e-commerce managers that are just moving and they’re doing these things and then someone from another channel, the CFO, they come in and then I have to deal with it. We always teach our team: be clear with your clients. Get ahead of these things, bring these issues up and it sounds like you’re again doing that again, purpose and intention.

[00:57:51] “Hey, I know this is different. Let’s have a conversation about it. What can we do not hiding and waiting for there to be a problem? I’ve seen so many times where that’s the case, but you were again, purposeful, intentional. This could be a problem.

[00:58:05] Let’s talk about it and probably did the same thing, right? What do you need from this? What can we do together? And what I’ve seen through this whole conversation is partnership. We talk about, and I’m sure you have too, and you’ve seen our stuff… Affiliate Marketing is about relationships, about partnerships, and managing affiliate channel and any digital marketing channel is also about partnerships.

[00:58:27] And so I commend you. It’s a really great story that you’ve been able to do and great things that you’ve accomplished.

[00:58:34] Kevin: Well, I appreciate that. And I will add to that, one of the things I probably should have started with on the JCPenney front was: JCPenney did a really good job in the early aughts because they’d… JCPenney in the 90s started to fall apart. The store started declining catalog started declining Alan Questern came in reset the direction for the company.

[00:58:51] One of the first projects I was working on at JCPenney.com when I got there in 2001 was we built a billion dollar plan for JCPenney.com. Our goal was to get JCPenney.com to a billion dollars in revenue in five years. Once we had that North Star, a lot of these things started to line up behind it very quickly.

[00:59:08] There are so many companies out there today, they’re single channel, or they’re multi-channel retailers that don’t talk to each other, that don’t set that true strategy or that true North Star, that direction that they’re going. And because of that, it’s easy to say, “oh, we’re spending too much money. Turn that off.” Right?

[00:59:24] But if you have the North Star, you can say, “but wait, we’re supporting the strategy by achieving these things,” and all of a sudden you don’t want to turn it off, you actually want to turn it up and there’s better ways to get there.

[00:59:35] Jamie: We see so many people from the agency side over this almost 20 years, not share that North Star with their agencies, not just affiliate, but their search, they don’t share that. And the conversation is, and the goal is more, more money, more profit, more new customers, but they don’t share what that is.

[00:59:53] The agencies are a channel themselves then, and if they know what that North Star is, and they have an understanding of how all the channels are playing together and what they need, they’re usually able to come to it with some creativity to it as well. So sharing that North Star is huge.

[01:00:07] So we are at our time, but I did have one question, something that I’ve seen over the last couple of months is: there’s a lot of OGs like us, that have been around for a long time, they’re looking for their next career move and it’s not necessarily up.

[01:00:22] Maybe they’ve reached that and now they want to do something else. You’ve talked a lot about mentoring the next generation. What’s the most difficult part of that for maybe the seeker and the hiring managers of looking at someone who’s had this broad experience and maybe they’re looking for something that is a rung or two down or laterally.

[01:00:42] What shouldn’t they overlook? How do you feel about that?

[01:00:45] Kevin: Yeah, I like that question because I actually just had a conversation with a recruiter this morning about that. The nice thing is, I guess once you get to this point in your career, recruiters call you to ask for your advice as well, so I get to talk to recruiters and provide advice.

[01:00:56] But we got into this conversation and he told me, he said, I’ve got these people that are applying to me for these positions that I’m posting, and they’re willing to make less money, but I can’t figure out why, or they’re willing to take a lower position, and I can’t figure out why, what are your thoughts on that?

[01:01:13] And I said, well, you know, a lot of times when people get to the later part of their careers, they’re no longer chasing dollars. They’re not chasing titles anymore. They’re not chasing how many people can I manage or how big is the company that I run? What they’re trying to do is they’re trying to figure out where they can plug in and actually start to give back a little bit to what they’ve done.

[01:01:29] I mean, I look back on my career, there were people that poured into me. That gave me the ability to get to where I am, and I didn’t realize it at the time that that’s what they were doing, but I took it for what it was. And now I think companies are missing the mark when they’re looking at somebody and saying, you’re overqualified, or we think we’re going to have to pay too much for you.

[01:01:48] Because what they’re not seeing is, here’s somebody that has been through the paces before. They understand where the bear traps are and they don’t step in them. They understand how to communicate effectively because they’ve seen the 360 view of what’s going on. And yeah, sometimes that looks like it’s a slower, maybe a more measured pace about what’s going on.

[01:02:06] But at the end of the day, most people never say, gosh, we wish we would have gone 10 times faster. They say, “Oh, we should have slowed down so we didn’t miss that.” And I think what people are missing with the ability to hire these days is just that opportunity to to get somebody onto a team that’s willing to sit with somebody and teach them and coach them and mentor them and get them to the next level of their career.

[01:02:27] Because at some point this generation is going to be the leadership for the next generation. And if we don’t teach those things, it’s going to be a lot more, it’s going to we’ll lament. But I will say as well, obviously we’re a much faster pace and faster culture than we were 10, 20, 30 years ago.

[01:02:44] A lot of people only look back six months to a year now. I remember 10 years ago, it was people only look back two to three years and 15 years ago, people look back four to five years. We can’t lose sight of the things that are beyond what we can look back and see in a longer period, and there’s so much value out there.

[01:03:00] There’s a lot of people that have a lot of experience that they can bring to the table and sometimes they’re willing to do it for even less money. So then that gives you more budget, more money to pour into budgets for other digital marketing things or whatever. I think there’s a lot of value that’s being left on the table by just kind of overlooking,

[01:03:16] Jamie: Great. I appreciate your perspective on that. Kevin, thank you so much. If there are listeners who want to connect with you and follow you what’s the best way for them to do that?

[01:03:26] Kevin: Probably on LinkedIn. I use Twitter, but LinkedIn, Kevin Strawbridge, I pop up pretty quick. I’m on Twitter, but I stay on Twitter, I follow people like you and others that gimme good articles and different things to read. I haven’t posted as much there. I had some live blogs that I’ve kind of taken down, and so there’s nothing there at this time, but, LinkedIn is probably the best place to follow me.

[01:03:45] Jamie: Awesome. So we’ll include that in the show notes. So definitely reach out to Kevin. Kevin, thank you so much. We’re over time, but this has been fantastic. I have about 50 other questions I want to ask you. So I would love to have you back on for a second episode that maybe we’ll schedule sometime after the first of the year.

[01:04:03] But really the purpose and intentionality, and the way that you built the business case and how you crafted your career, how you look at the channels, all been a really great perspective for our show, and I’m sure everyone will appreciate hearing that.

[01:04:16] Thank you very much for spending some time with me today.

[01:04:19] Kevin: Thank you. And I’ll speak for the community when I say we appreciate what you do for the affiliate community. I know you pour a lot of yourself into it and that’s greatly appreciated by a lot of us who have helped alongside you help to grow this to what is amazing profession.

[01:04:32] Jamie: I appreciate that. Well, you enjoy the rest of your day and hopefully the Hawks will surprise us tonight.

[01:04:38] Kevin: Let’s go.

[01:04:41] Jamie: First of all, Kevin, thank you so much for spending that hour and some change with me today. Really appreciate your friendship over the years and your perspective on all things marketing, and leadership, management, mentorship, all those things. So thanks for taking the time today to spend with me.

[01:05:00] Wow. What a podcast. I got, I got But so many things to learn. One of the things that I wanted to point out for those of you who are listening, maybe you’re starting your career, you’re halfway through, or maybe you’re 48 too turning 49 and trying to figure out to do the way that Kevin crafted and how he looked at his career is something that, you know, I I’ve had the good fortune to be raised in a family that those kinds of things is what we talked about, but that’s pretty unique to have that sort of background.

[01:05:32] But the ability to craft it and to really look and say, “I want to go here and that that goal needs to be first, where do you want to go? What do you want to do?” How Kevin came to that, he was networking. He met these people early on. He spent time with them.

[01:05:48] So he saw that, “you know what, I want to run my own company. I’m going to run a company for somewhere else. I want to be a CEO.” And then with purpose, that purpose of becoming a CEO, he then married that with the intentionality. ” What do I need to get there? And taking an honest look of what are those pillars, I need to get there?”

[01:06:07] And seeing that numbers, accounting finance, that was a thing he had to have. And he went and got that in his education, and then he used that in these other areas, and then being able to see, there were these pillars. Now I need to go get some where I need to pull companies apart and build them back up again.

[01:06:26] I need to get management experience. I need to get marketing experience. I need to get all these different things, and then he went from one to the other. If you’re kind of floundering around, not sure what to do use that intentionality, find your purpose, and sometimes you may not know what it is, but you put something out there. Be clear with what it is, but open that may change. That’s okay. Shout out to Joseph Shapiro for Clear and Open.

[01:06:53] But use that and then network, find out from other people. What do I need to get there? Find a mentor in each of those areas and go out and get there. Craft your career. Did you know you could do that? We talk about that a lot here. I really love to draw that out.

[01:07:09] So that was one thing. The other thing is treating affiliates are always partners, but also seeing that those other channel owners within your company, they’re also partners too. I loved how Kevin went about it. And again, like I said in the episode, much different than I did at the time. I really wish that I had seen that happening and had learned that lesson back then, but those town halls… so right now you could be listening and you’re struggling with other channels, not understanding what you do and what the affiliate marketing channel is. That’s something that we do at JEB is we’ll meet with all those other channel owners to see, but just that town hall of what do you guys need from this channel? What do you understand it?

[01:07:52] And that consistent education internally was such a great way to get everyone on board and everyone working together to the same goal. And how he worked with finance and budgeting, that concept of assimilating first with the team is so important. So many great things.

[01:08:12] Also, if you’re a hiring manager, I hope you heard that last little bit. A lot of great people with lots of experience are looking for not just achievement, but significance, and mentoring the next generation is how a lot of those can get there. So definitely take a look at that. It was really a tremendous podcast. So much in there that I hoped you learned.

[01:08:32] We are still looking for a guest for season four. We’ll start recording that at the end of the first quarter next year. So if you would like to be on this podcast, we’d love to have you email us at gethelp@jebcommerce.com. If you know someone who should be on this podcast that we should be talking to, let us know again, gethelp@jebcommerce.com.

[01:08:53] If there’s anything in the topics we covered today, Kevin and I, that you’re struggling with, and you want some help, just email us at that email address, and we’ll get back to you right away. And definitely check out jebcommerce.com/elements for more information on our product tiers.

[01:09:10] And if you found this podcast helpful, please go share it on LinkedIn, Facebook, X, and whatever social network that you use. Send it to someone that you feel needs this. But also leave us a five star review, whether that’s Apple Podcast or Spotify. That’s one of the best ways you can help us get the word out.

[01:09:29] Well, I thank you for spending this hour in some change. If you made it this far, really appreciate you listening. I hope you’ve learned a bit today. I hope you leave this seeking purpose and intentionality within your career and just seeing where else you can put that in your life.

[01:09:46] But thank you for listening and we’ll see you on the next episode.