The Hidden Ecommerce Revenue Killers Eating Your Margins with DJ Sprague

You can spend more on ads, push more traffic, and still feel broke at the end of the month. That’s the moment we wanted to tackle with DJ Sprague, co-author of Cash Flow: How to Save More Money, Make More Money, and Scale Like Crazy Online. We get into the uncomfortable idea that many ecommerce brands are leaking profit in places your P&L barely reveals, even when your revenue looks “healthy.”

We walk through the 10 hidden revenue killers that quietly erode margins: payment processing fees, fraud and fraud management costs, chargebacks, false declines, returns, lost or damaged shipments, cart abandonment, security concerns, and site abandonment. DJ explains why payment processors can accidentally reject legitimate customers, how chargebacks can spiral into higher fees and cash reserves that crush ecommerce cash flow, and why simple trust signals like security badges can lift conversion rate and even average order value.

Then we shift to the upside: revenue drivers that compound over time. We talk product reviews, store ratings, video reviews, reputation management, and a searchable Q&A system that helps shoppers answer high-intent questions while boosting SEO visibility through rich snippets and organic search. DJ also shares real-world results, plus what implementation looks like for Shopify and other platforms, including the tools and support they provide.

If you run an ecommerce brand and want practical, margin-first growth, listen now, subscribe for more operator-focused conversations, and share this with a founder friend. After you listen, will you fix leaks first or buy more traffic?

How to connect with DJ?
Website: https://www.shopperapproved.com/
Podcast: https://trafficandconversionpodcast.com/
LinkedIN: https://www.linkedin.com/in/duanesprague/
Instagram: https://www.instagram.com/shopperapproved
Youtube: https://www.youtube.com/channel/UCrzQXyLiXhci0hw8FhnVC7A
Twitter: https://x.com/shopperapproved
Facebook: https://www.facebook.com/shopperapproved

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Transcript

Why Growth Still Feels Unprofitable

SPEAKER_00 1:07

Welcome everyone to the Firing the Man Podcast, a show for anyone who wants to be their own boss. If you sit in a cubicle every day and know you are capable of more, then join us. This show will help you build a business and grow your passive income stream in just a few short hours per day. And now your hosts, serial entrepreneurs, David Schoma and Ken Wilson.

SPEAKER_01 1:34

Welcome back to the Firing the Man Podcast, where we help you break free from the 9 to 5, build a business on your terms, and create real freedom through entrepreneurship. Today's episode is one I think every e-commerce operator, especially those doing real volume, is going to want to pay attention to. We're joined by DJ Sprague, the co-author of the book Cash Flow: How to Save More Money, Make More Money, and Scale Like Crazy Online. DJ has spent years deep in the trenches working with e-commerce brands from scrappy startups to massive operators, helping them uncover what's really driving profitability. And more importantly, what's quietly killing it. In this episode, we're going to challenge a big assumption that most entrepreneurs have that growth comes from more traffic, more ads, and more top line revenue. DJ is going to make the case that you're likely to leave a massive amount of money on the table already. We're talking about hidden revenue leaks, things like failed payments, fraud, chargebacks, car abandonment, and trust issues that can quietly eat away at your margins without ever showing up clearly in your reports. In this episode, we're going to dig into the concept of the 10 hidden revenue killers and how they impact your business, why your payment processor might actually be costing you more than you think, how small improvements across your funnel can compound into massive gains, and what practical steps you can take right now to plug the leaks and scale more profitably. If you've ever felt like you're working harder, spending more on ads, but not seeing the profit you should be, this episode is going to hit home. So without further ado, let's dive in. DJ, welcome to the show.

SPEAKER_02 3:29

Thanks so much, David. As usual, really excited to be here to talk about my favorite topic, e-commerce revenue optimization, as I know it's yours as well. So we're uh we're two P's in a pod.

SPEAKER_01 3:41

Absolutely, absolutely. So to start off the show, um, for those who are not familiar with you yet, can you give us a quick background on what you've been working on over the last few years and what r led you to writing cash flow?

SPEAKER_02 3:58

Yeah. Um so Scott Branley uh is my co-founder of Cashflow, and he's also my co-author of the book Cashflow. Uh Cash Flow is a product and a book. Uh he is also the founder of Shopper Approved, and he and I co-authored a book called Reputation King. And these are real books, by the way, uh you know, 200 plus pages with you know 100 plus citations, uh charts, graphs, uh before and afters, best practices, examples, uh loaded with research, primary and secondary research. So these are these are real books, well researched, well-documented, well-cited. Uh we wrote Reputation King because we've been in the reputation management space since 2010, 16 years in reputation management. Uh I joined uh Shopper Approved in about 2018. Uh Scott and I met for pizza one day uh because a joint friend recommended that we meet because we both had the passion. In fact, I started writing a book about reputation management. Uh I was CMO of a national franchise doing well over a billion dollars a year, and helped turn that company around by managing their online reputation, because quite honestly, they had a very poor, unmanaged online reputation. So turned that around in record time, and sales went up, leads went up, revenue went up, profits went up, the whole bit. So I became a real advocate for reputation management. So we wrote the book, Reputation King, uh, specifically for e-commerce. And one day, uh, we also have a podcast, by the way, uh, the e-commerce trafficking version podcast, and we were interviewing a guest, and he was talking about how much revenue and profit was lost through the payment processing uh process, uh, through false declines, through fraud, et cetera. And we got thinking, uh, let's dig into this a little bit further. Uh the numbers sounded crazy, right? So as we start digging into all the ways that payment processors are not doing the best thing for their clients, uh, we also started to look at what is the actual net profit of the average e-commerce website. So looking at the research, a e-commerce website doing$5 to$10 million a year is only getting a net profit after all operating expenses of 3 to 8%, with the top performers doing 10 to 12%. So not a ton of net profit at the end of the day because there's so many areas of revenue leaks, we call it. So we started digging into that, and we identified what we call the 10 common or 10 primary revenue leaks, uh, and we wrote a book about it. We layered into that uh the five revenue drivers. And so there's there's 10 revenue leaks that we solve and five revenue drivers that we amplify, and that is the basis for cash flow, which is on Amazon, by the way. It's also free, which we can talk about later. But uh that's really the impetus to cash flow the product and cash flow the book, uh, because we realize that e-commerce websites were not keeping as much money as they could and should based on these very common solvable revenue leaks. That's the driver behind the book.

Payment Processors And The Real Fees

SPEAKER_01 7:35

Okay. All right. Very nice. Well, uh because this is going to come up quite a few times throughout the episode, can you explain what is a payment processor and w what do they do?

SPEAKER_02 7:50

Payment processors everybody has to have. It's uh a necessary evil. They are the intermediary between the customer who puts in their credit card number and the bank who collects the money and then pays you, the vendor, the merchant. And there are all kinds of fees involved in that process. And uh typically it averages 3.1% of your transactions. Why 3.1%? Well, yes, you have the stated transaction rate. That could be 2.5%, 2.5%, 3.7, 3.9, or 2.9, 2.7, whatever the number is, depending on your payment processor and what you've negotiated and the volume of your business. So it's going to be anywhere between, say, 2.5% to 3%. But there's also the 25 to 35 cents per transaction fee. There's also set of fees, hidden fees, et cetera. So the actual average, when you total it all up, is 3.1%. So basically what you're doing is you're paying 3.1% for every transaction. And that's uh what payment processors are doing. They're they're taking a fee. It's a profit center, obviously. Uh part of that goes to the credit card companies. That's where Visa and MasterCard and American Express makes their money. Um, and part of it goes to the intermediary, if you will.

SPEAKER_01 9:18

All right. That that sounds good. And that that's going to set the stage for some of the questions that are going to come next. So one of the things, and and to to our audience, uh just a little bit of background on this. I read this book a couple months ago, and then again recently. And one of the things that really caught me off guard was I can, you know, I'm a I'm a retired CPA. I I've spent a lot of time around financial statements. And with my own brands on a monthly basis, I am probably spending one to two hours of very deep analysis where I'm getting into my PL and I am looking for opportunities to uncover more profit. And that's something that I take a lot of pride in. And when I I read uh on about this book, it it talked about 37.9% of revenue being lost. And one of the things about this is many of these don't show up on the PL. And I had this giant aha moment of when I'm sitting down for one to two hours every month examining my PL, I am not looking at the full picture. And there's a number of these other areas I need to be looking at in order to uh give my business the checkup that it deserves, right? The profitability checkup. And so, you know, with that number, 37.9% of revenue being lost, for a typical million dollar to$10 million e-commerce brand, what what does that mean for them?

The 10 Hidden Revenue Killers

SPEAKER_02 12:09

Well, that that means a tremendous amount of of you know profit to the bottom line. So let's just let's just do some you know quick math. If you're if you're a uh five million dollar company, right, time let's just say 37%, that's uh uh$1.8 million dollars a year that's being lost that you know could go in your bank, that could go to your bottom line. So five million dollar company, one point eight million gone. Um obviously, if you can recapture all of that, that's that's just a huge bump to your net profit. Uh if you can capture part of that, it's a significant bump to your profit. And the beauty of that, David, is that you don't have to spend any more money to get it. You don't have to revamp your website to get it. You don't have to re-platform. You don't have to do anything crazy to get it. It's money that's on the table that you're simply not collecting. And that's what we got obsessed about when we started to dig into this. And we spent a year researching all these things. Uh, you know, we we looked at dozens and dozens and dozens of studies from Visa, Beimart Institute, Equifax, et cetera, uh, Shopify, I mean, you name it. We we we just dug through all kinds of research and data to really uncover where this money was going and why, and then how we could help recapture and reclaim as much of that money as possible for our clients. But here's the thing: we want to do it at no cost. Now that sounds insane, right? How are you going to recapture this money at no cost? And the way we did that was we reverse-engineered it. We created our own payment processor so that we could take a portion of the profits from that payment processor and literally subsidize a stack, a tech stack of software and tools to recapture that revenue and drive more top-line sales as well. So instead of just buying Gulf Streams, uh, like a lot of payment processors do, I'm not going to mention names, but you know the drill, right? We decide to plow that money back into our clients. So we truly partner. You know, people say, I want to partner with you. What does that mean? I want to sell you something. That's what partnering really means. I want to sell you something. When we say we want to partner with you, that means we want to literally reinvest into your company so that we can help you grow. Now, naturally, we make a little bit of money on that payment processing fee, but we're not charging any more for it. We're just, we're just taking a much lesser piece because we don't have the operating capital. We don't have buildings in Manhattan and San Francisco, et cetera. So our and we're not a public company. So we can do what we want. We don't have to make hundreds of millions to billions of dollars a year. Uh we can we can literally operate on a much, much, much thinner margin while simultaneously reinvesting in the company and buying all the software, which replaces software you're already paying for. Obviously, you have to have a review platform, you have to have card abandonment software, you have to have site abandonment software, you have to have uh fraud detection software, you have to have shipping tracking software, et cetera. Well, what if you had all of that included in your cash flow app that paid for all that? So that comes right off the top line. You no longer pay for that software because it's all included. And I know your question is going to be, well, what about Shopify? Who wants to move away from Strype because of all the built-in analytics? You don't have to. We have an app that just kind of layers on top of that. So you can keep your Shopify Pay and ShopPay and all your analytics with Strype is a great product, uh, but layer on top of that all the benefits without getting rid of that. That was a lot to digest.

SPEAKER_01 16:17

No, no, that it's really good. And I I think it's an awesome business model that you guys have come up with. You know, I look at, you know, I'll make a hundred dollar sale and$96.90 or$97 ends up in my bank account. And I ask myself, well, what did I get for that? Um, you know, in return uh from my payment processor. And it's it's very little. Um, and as we we dig in more, uh, we find out that uh payment pro not all payment processors are created equal, and they certainly can cost you a lot more money than than what is appearing on your statement. And so I I do want to get into to some of these revenue killers. And you know, to our operators listening, what what would be one to two of these revenue killers that could be implemented and and would move the needle the the most? Like what which do you find to be the most significant?

Fast Wins From Trust And Fewer Returns

SPEAKER_02 17:20

Yeah. If you don't mind, I'd like to go through the 10 and then address that. Okay. Just to understand the breadth and depth of what we're talking about here. So the ten common revenue killers that drain up to 37.9% of your profits include payment processing fees, average of 3.1%, fraud, 3.6%, and this is all national studies, uh, fraud management costs, which is your internal uh staff and additional software, 3% of gross revenue, chargebacks, 1.5%, false declines, 6.5% of a legitimate orders of decline, so that's revenue you never saw. Uh returns, the average is 16.9%. Now that's the average. If you're in the apparel industry, it's well into the 20s, and it could be high 20s. There's a lot of returns in apparel, because as you know, fit is critical. In fact, that's one of the things we're addressing with one of our clients. And uh he's blown away with some of the strategies we've come up with there. But in any case, returns are huge. Call it 17% rounding up. Lost, stolen, and damaged shipments is 3.3%. Abandoned carts. Well, think about this. Uh 70% of carts on average are abandoned. Only 7% of people create a cart. 93% never even create a cart. Of the 7% that create a cart, 70% abandon. So that means that 375% of your potential revenue is lost. Uh security concerns. 25%, this is according to Beimard and other studies, 25% of abandoned carts is due to security concerns alone, which is tremendous. What does that mean? I don't trust your website, I don't trust your uh payment processing system, uh, I'm not sure that you're going to protect my privacy because they don't see obvious, clear signs, seals, if you will, that say this website is secure. It's a huge overlooked opportunity. Look at Amazon. Even Amazon to this day, above the add to cart button or pay now button, it has secure website. Now everybody trusts Amazon. They've been probably spent thousands, if not tens of thousands of dollars over the years on Amazon. But they still do it. Why? It's a subconscious signal of trust, credibility, that you can you can proceed with confidence. Now, when you're dealing with an independent website, especially one you've never bought from before, you don't know. You have no past experience. So this is super important. Um and then site abandonment. Again, 93% of your visitors leave the site without creating a cart. So those are the uh 10 revenue killers. And then the five revenue generators are product reviews, store ratings, used to be called seller ratings, video reviews, reputation management, search optimized QA. Those are the ones that drive additional uh revenue, vis-a-vis traffic, click-through rate, and on-page conversions. Any questions about the 10 revenue killers and the five revenue generators?

SPEAKER_01 20:43

So as I was going through the listening to you talking about the revenue killers, I was kind of envisioning holes in a boat. And I'm curious what tends to be the the large largest holes in the boat? Now you gave a percentage of sales so we we could look at that, but what what do you as you engage with with your clients and with uh e-commerce business owners, what tends to be the largest holes in their boat?

Chargebacks And The High Risk Trap

SPEAKER_02 21:13

Yeah. Returns and the easiest low-hanging fruit that you can literally solve in minutes is security, security concerns. You get immediate results, you get immediate increase in conversion rate, and even AOV. So there's two studies done by two different CRO companies, independently of each other, by the way. And they both were A-B split testing, Trust Guard. Trust Guard is a website security tool and seal and badge that goes on your website and clearly delineates that this website was scanned in the last 24 hours for malware, spio, et cetera. Uh it has a current SSL certificate, et cetera. And just by adding that, they both saw a 70% increase in conversion. So that's tremendous. And they saw a 21% increase in AOV. So you're getting obviously a bigger order and higher conversion rate. So that's that's big right there. Um, and it's easy to do. And then returns. So why do people return products? Uh in the apparel business, it's usually fit. Uh oh, the the color was off or the material was different than they expected, etc. But they also return products, regular products, at a very high rate. Again, 16.9%. Apparel is in the 20s. Uh, and a lot of that is because when they bought that product, they didn't have enough information. And it's very common uh for websites, unfortunately, not to have a robust QA tool that's searchable. You know, they might have an FAQ and they might have five or 10 or 15 uh clickable but not searchable. FAQs, you've seen it, right? You've seen the app where it's expandable. You just click on the question, then expand the answer. But A, it's not searchable. Uh, B, it does nothing for SEO. Uh, and and C, it's not very robust because it's just a few questions and answers. But if you have an actual searchable QA answer base, we call it, there is a lot of information that people can get about that product. Does it float? Is it waterproof? Um uh what colors does it come in? Uh does it fit with this? Does it attach to that? Uh how does it work with this application, etc.? And a lot of that can come from your salespeople, your own um customer support team. It can come from your search bar, it can come from your uh fact sheets, your data sheets, it can come from AI, it can come from your product descriptions. You can take all of that information and build a very robust question and answer database that's searchable. So you can put in a question and it will literally serve up just like your Google search bar, just like your on page search bar, it'll come up. With the answer. And that helps a tremendous amount because it's bad information or lack of information that generates a lot of returns. And returns are very expensive. Very expensive. Internally and hard cost. So you've got soft cost and hard costs that go into product returns. So if we can uh reduce that dramatically by offering a very robust searchable Q ⁇ A database, and then you lay on top of that a very robust product reviews where they can read the reviews from actual customers and they can see what people are saying about the product. Many times they can get those questions answered there. And it's far better to get the answers addressed on the front end of the sale than try to deal with it on the back end after they received it. Because now you got to deal with returns or exchanges, refunds, even chargebacks. You know, a lot of times, unfortunately, this is a big problem today, more and more consumers, rather than dealing with a return, they just do a chargeback. And that costs you a lot of money.

SPEAKER_01 25:27

I fully agree that with that. And let's go into chargebacks. And so for people that are unfamiliar with what it is, can can you explain what is a chargeback?

False Declines And Smarter Fraud Filters

SPEAKER_02 25:40

Yeah, a chargeback is when uh the consumer uh calls up their credit card company or just gets on the app or the website and says, I dispute this charge. So if you have an app for your credit card, which pretty much all of them have now, you know, you look at your statement and you look at, you know, I do it all the time. I want to make sure there's no false charges because you know how identity theft is these days. You want to make sure that every charge on there is legitimate and it's a charge you made. So you're looking at it, and then you see something you don't recognize. Uh, you can dispute it right there in the app. Or even if you recognize it, but it arrived broken, damaged, uh, it doesn't fit, it doesn't work, you can just say dispute this charge. And that initiates a chargeback. And chargebacks, on average, cost two and a half times the original cost of the product. So if the original cost of the product was$100, it can cost you, the merchant,$250. There's chargeback fees from the credit card company. Uh there are penalties. Um you lost the cost of the sale, obviously. You gotta pay to ship the product back, oftentimes. Um then, of course, there's a lost internal cost to deal with that. So on average, it's a two and a half time cost to you, the merchant, to deal the chargeback. Now the other problem is if you uh if if 0.9%, less than 1% of your transactions end up in a chargeback, Visa now is putting in you the high risk profile, where they can take your uh 2.5% to 3% card fee to 4%, 4.5%, plus they charge you an additional annual fee, plus they can charge you an additional per-transaction fee, plus they can hold uh up to 25% of your revenue for up to six months to deal with what they call future potential chargebacks. So it goes in a reserve fund. So your cash flow is killed. A lot of companies go to business as a result. If they get into that high profile um chargeback scenario, their fate is almost sealed because their cash flow is killed, their costs are killed. Um, and by the way, the uh payment processors ramp up their fraud filters and decline more purchases. Now, chargebacks can also come because of real fraud, legitimate fraud. So there's friendly fraud where a legitimate customer just does a chargeback, and then there's real fraud where uh I have a charge in my account and it wasn't me. I didn't buy that product, and I dispute it. Uh obviously, I get the money back. Obviously, the merchant has to pay for that, and they don't get the product back. So that's that's real fraud, legitimate fraud. Uh, and both are increasing. So it was a survey done, uh, I believe it was by Visa, and they were surveying consumers uh to try to figure out why there's so much more friendly fraud these days. And the bottom line is, especially the younger consumers, they don't understand the difference between uh a uh dispute and a return. They just find it easier to dispute it than return it and deal with the merchant. So it's uh it's a it's a problem. It's an expensive problem. So reducing uh chargebacks is very, very important for the short term and the long term because you don't want to get into that high-risk profile where your fees go up arithmetically, or you know, it can double, your costs go up, uh, your um, you know, cash reserves, all of a sudden your money's tied up for three to six months. And it can take years to get out of that high profile risk scenario.

SPEAKER_01 29:29

Yeah, that's uh that's a real bummer for an e-commerce company. I mean, it's not like you can start accepting cash and checks, right? Uh you need you need those credit cards. Uh that's what people are paying with. And and so um you you had talked about the ramping up of the fraud filters and and what that can potentially do. So what payment processors can't, as you have mentioned, can be part of the problem. What are they doing behind the scenes that most founders don't know they're doing?

SPEAKER_02 30:03

Yeah, so your average payment processor uh has uh their own algorithms and their own filters to identify fraud as much as they can. Um and it's it's better than it used to be because they're using more AI uh and machine learning than they used to. Uh it used to be just filters. So, for example, a mechanical filter would be the delivery address doesn't match the credit card payment address decline, right? Well, if I'm on vacation and I'm in Hawaii and I ordered something to be delivered to my hotel in Hawaii, well, obviously my delivery address doesn't match my billing address. But that through mechanics, through mechanical filters, would automatically be denied because that looks like a stolen card, right? Um, and then there's machine learning, and now there's AI. Uh, so it's getting better. But here's the real problem. Unless you're partnering with Equifax, like we do with cash flow, then you're not tapping into their vast consumer database. So a little pitch for Equifax. Uh we power our payment processing filters through Equifax, whether you're working with Shopify or BigCommerce or WooCommerce, um, they are monitoring over 32 billion consumer transactions per year. 32 billion. They monitor 7,000 data points on every consumer. Well, 245 million American consumers and growing. So they're looking at 245 million plus American consumers, that's just American, and they're looking at 7,000 data points and over 32 billion transactions to do what? To make sure that David Schomer is David Shomer, that this credit card belongs to him and it's a real credit card, whether he's traveling in Hawaii or Mexico, or he's at his brother-in-law's house for the holidays, right? They're looking at trends. They're looking at, oh, have we seen this card before? Have we seen this address before? Have we seen um, you know, uh transactions similar to this before from David? And they're able to dig into this vast consumer database that no other card processor is able to do because they don't have the Aquifax database. So their average acceptance rate is 97.8%. Call it 98% rounding up. 98% acceptance rate, that's as high or higher than retail brick and mortar, because even they aren't tapping into the Quifax database. So you have a acceptance rate that's as high or higher than brick and mortar itself, which is the highest. That's physical card in hand, right, versus a virtual transaction online. So if you can have that kind of acceptance rate, what does that do? That means your false decline rate also goes way down, which means you're selling and converting more because false declines, as we talked about, are also a big source of revenue erosion. You talked about holes in the boat. Well, that's a hole in the boat. If you're declining good customers with real cards and they want to make a purchase, but they get declined, you lost that revenue. You lost that sale. That drives up your CAC, that drives down your revenue, that drives down your margin. And statistically, they don't come back because they get upset and like, well, why would I come back to this site? So they go buy from another customer or another merchant. So this is a you know a big deal. And so this is something that we really took to heart, and we looked at every way to Sunday to figure out how to reduce false declines and maximize the acceptance or acceptance rates while reducing fraud. And this is what we came up with, and this is all part of the you know cash flow payment processing back end, and it comes free. Normally you'd pay for that. It's all built in, it's all free.

Real Client Results With Hard Numbers

SPEAKER_01 34:07

I I think this is a huge one for e-commerce business owners to pay attention to. And you know, to make the comparison, if you if you did have a brick and mortar and you did notice that people were come good customers coming in, trying to pay with their card, couldn't, had to take their merchandise, go put it back on the rack, and then leave your store, it would be glaringly obvious that you have a problem. Now, that scenario in e-commerce, you you don't see it. It doesn't show up on your PL. Uh and really looking at conversion rates, you can't pick up on that. And so it is it's a significant hole in the boat, and and and so I I like that partnering with Equifax, and and I think this is something that there are giant e-commerce companies that are not aware of this, and and and I'm glad that we're talking about it.

SPEAKER_02 35:03

Yeah, it's it is huge, David. It's uh like I say, it's one of many holes, but it's a significant one. And it's silent. It's a silent killer. Because, like you said, it doesn't show up in the P ⁇ L. Uh, you're not really aware of it. You don't you don't know that somebody got declined and it was a good, a good card and a good customer. How do you know that? It was just another decline, right? Uh the only way to really measure that uh is to do a before and after scenario. Before cash flow, after cash flow. What's your acceptance rate? Oh, you know, it went up 18%. Okay. There's a way to measure it. I've got I've got more sales, I've got a higher conversion rate, and I've got more uh gross and net profit. I'll take that.

SPEAKER_01 35:48

Absolutely. Absolutely. Um, can you walk us through a real-world example before before and after of a brand that that plugged these holes in the boat that that we're discussing and what changed financially?

SPEAKER_02 36:00

Yeah. Um so we've got a couple examples. So we've got um one client. Let me find these numbers so I don't misquote. There we go. So we've got a brand new client, two months on board, doesn't even have all the tools installed yet. Uh coincidentally, he he signed up for cash flow in the middle of a site rebuild. So he's kind of doing two things at once. So we're taking this slower with him uh installing all of the apps. Uh but he's got about half the apps installed, and it's been two months. His total revenue is up 25% so far, and his returns are down 3% so far. Now, another client, uh, after six months of just using the store ratings, the product reviews, the search optimized uh QA tool, and the website security tool increased their conversion rate by 272% and their traffic by 570%. Why? Because reviews showing up in rich snippets in your ads, in your uh Google Shopping, in your organic search results increase click-through rate by 25 to 35%. They also increase conversion rate by 30 to 40% or more, depends on the study you look at. Some studies are in the triple digits. Uh and then the QA tool optimizes in the search results, in the feature templates, in AI search and traditional search, in the top search results, page one, with the answer to the product question, which are very low funnel, high conversion, high purchase intent search questions. Does the ABC widget fit with the XYZ product? That's a high purchase intent, low funnel question. If you can answer that in the AI search result, in the featured snippet, or the top one through three organic search results, you've got the click. And obviously, if they click through to your product page that has that answer, and they see your product reviews and they see your store ratings, and you've got a competitive price, why wouldn't they buy? You're the only one that answered the question. So you can see how the compilation of SEO in the reviews and the QA drive visibility, drive clicks, and drive conversions. Hence the 272% increase in conversion rate and the 570% increase in traffic.

SPEAKER_01 38:38

That's huge. That's huge. And I'm glad that we're putting real numbers behind this because it takes it from theoretical to cold hard numbers, which I really like.

How Onboarding Works And What You Get

SPEAKER_02 38:47

Trevor Burrus, Jr.: It's it's real. And what we do, David, is Scott and I are behavioral science geeks. Uh we've studied David, sorry, Dr. Robert Cialdini, uh, and many, many others. In fact, Dr. Cialdini wrote the uh cover quote to Reputation King. Reputation King has all these examples, case studies, best practices, before and afters, et cetera. I mean, we really tear down uh the whole behavioral science behind reviews and QA in Reputation King. Uh, and then of course, you know, cash flow gets into the revenue leaks as well. Uh and both books are free, by the way, digitally and audio. So you don't have to pay for anything. We'd like to make everything free. Like we're all about let's be totally transparent, let's expose everything. Uh I like to say put your wallet away, nothing to buy. Because we we have engineered a way to make all this free to the e-commerce merchant. Because if we're just selling them more software, then you got to get into that whole ROIR argument, right? Which was one of your questions I know you wanted to ask. What's the ROI, right? Well, ROI means return on investment. If there's no re-investment, you don't have to calculate ROI because it's just free.

unknown 39:59

Yeah.

SPEAKER_02 39:59

Which is a crazy concept. Like who does that?

SPEAKER_01 40:03

It it is, and it it makes the decision a lot easier on on what what your next step is. And so let's walk through this. And and you you had mentioned you you work with WooCommerce, Shopify, all the major platforms. Um we have a high concentration of Shopify listeners. And so let's walk through what this looks like. So people get in people get in touch with you, they say, hey, I want to get plugged into your ecosystem. What happens? What can they expect? How long is implementation? Can you walk us through that? Absolutely.

Fire Round And Final Advice

SPEAKER_02 40:37

So to start, they go to cashflowpay.com and they watch a short little introductory video. It's about three minutes, high level. They put in their name and email address, then they hit the button and they go watch the full demo, which is about an hour and 15 minutes, and that walks through the whole process, all the products, how it works, etc. From there, uh they can book an appointment with Scott and I, and we can answer any additional questions. Once they um watch that full demo and just give us a few more data points, i.e. their URL, uh what platform they're on, WooCommerce, BigCommerce, uh, Shopify, um, annual sales, and their name. Uh obviously that goes in our CRM. Now we kind of know who we're dealing with. They book an appointment, and we can then answer any questions. They're automatically going to get by email uh what we call the cash flow kit. The cash flow kit includes a link to the audio books, both books, the uh digital books, the calculator, where they can go in and literally put in their own data on all of the different uh revenue killers and revenue generators, all 15, and it will calculate how much money they're leaving on the table and how much additional revenue they can make. If that number makes sense, book an appointment. By all means, you have nothing to lose. And we'll walk you through how it works. Now we then assign them to what we call a cash flow concierge. The cash flow concierge takes care of all the onboarding with all the software. Again, put your money away, nothing to buy. Uh, they get the uh cash flow app if they're on Shopify. Now, the cash flow app does charge 0.49%, 0.49%, less than half a percent for every transaction. What does that do? That pays for all of the 15 software tools. Okay, so that's gonna fund, right? Subsidize, if you will, all the tools. Now, our research says that the average e-commerce site doing one to five million a year is spending between$1,000 and$5,000 a month on all the software we're gonna give them for free. Now, here's what happens: the software tools are automatically going to increase your conversion rate, increase your AOV, increase your traffic, increase your revenue, your gross and net. That's going to offset that 0.49%. Now, if you're on WooCommerce or BigCommerce and you're paying 2.5% to 3% for whatever payment processor, it's gonna offset that. In fact, we guarantee that by the end of 12 months of setting up the software, if we don't at least offset your processing fee or the app fee, we give you$5,000, no questions asked. Because we absolutely know it's gonna work. For example, we have one tool alone, just one tool. It's it's one part of our card abandonment strategy that's already increased this one website's revenue by 7%. Right? Now they're on Shopify. So if they're paying half a percent for the app, and they're paying another 2.5% for Stripe, that's 3%. So you take 7% minus 3%, they're 4% ahead in revenue from one tool alone. That doesn't even include what we're doing to optimize their website through our cash flow uh club, which is our community, whereby we go through and we help do a website review and we look for the friction points and all those things that are driving confusion, ambiguity, um, decision uh analysis paralysis. We help streamline the website and get them to the product page as soon as possible. We optimize the product page with the right product heuristics, uh, the right design, uh, et cetera, to optimize conversion and AOV. So that's all part of our amalgamation of product plus service or software plus service. It's a hybrid. We week we meet weekly for an hour and a half, and we you know talk about um you know how to improve the conversion rate and the revenue on your website, everything from cross cells, upsells, um, LTV, conversion rate, uh, lead generation, list building, et cetera. We bring in experts like yourself. Uh we have a vetted, handpicked group of what we call the cash flow collective, uh, and its services and experts like BuildGoScale that can take it to the next level. We don't know everything. We're good, but we don't know everything. So we bring in experts on SEO, CRO, revenue optimization, uh, PPC, social media ads, uh, affiliate marketing, etc., to uh basically help our community see new opportunities. We also do what we call the um the book club, it's a celebrity book club, and we'll bring in the authors of books, uh, and we'll have everybody in the community read the book, then we'll bring in the author to go through QA. So, what what questions do you have? Uh, you know, how can I help you realize uh how to use the strategies and tools in the book? And so it's a really interactive uh Hybrid, it's not just software, it's software and the community and experts. And we literally are hand selecting and vetting the people that we would use ourselves and bringing them into our community to be the subject matter expert in their area of expertise.

SPEAKER_01 46:34

I love it. And it's no cost, it's all free. Again, push them all out away. We're not asking for any money. I like it. Oh, that's awesome. Well, we are going to post links to all of that in the show notes, as well as a link to the book. And to the to the listeners, I've read it. I've I've read it and I've listened to it. It's outstanding. Um, and go out and and read the book, and it's it's you will benefit from it. And uh get in touch with DJ if if you think this could be of of benefit to you. Uh I certainly am with one of my own personal brands. Now, DJ, before we end the show, we have something called the Fire Round. It's four questions we ask everybody at the end of the show. Are you ready? I'm ready. All right, here we go. What is your favorite book?

SPEAKER_02 47:20

Okay, you can't you can't nail me in that, but I love this book, Online Influence. Uh it's one of my Bibles. It's all about behavioral psychology online, specifically for e-commerce. Obviously, I love this book, as you can see, also one of my Bibles. And uh obviously, I love our own books. They all work together because as you know, um everybody has a piece of the solution. Everybody has a piece of the pie. And so I like to, you know, bring all of that together. And you can't see it behind me, but I've got a massive bookshelf, huge reader, constantly reading new books. Um, but this this, if I had to, you know, say one on online behavioral psychology, uh, it's this one. Um, but you know, I love many, many books.

SPEAKER_01 48:08

Okay. Very good. I love it. What are your hobbies?

SPEAKER_02 48:12

Hiking, uh, travel. I love travel. I love um exotic travel. I've been to Saudi Arabia. Uh I've been to Tahiti, uh sailed on a catamaran around the French Polynesian Islands a couple of times. Uh I love being on the water, love being in the water. Uh I love the tropics. Uh, I love uh South Pacific, um, particularly. Um I love the Bahamas, I love the Caribbean. Uh obviously I like warm water, clear water, and palm trees.

SPEAKER_01 48:41

Yeah. Yeah. Uh I'm getting that from your answer. Um what is uh one thing you do not miss about working for the man?

SPEAKER_02 48:51

Oh, wow. Um inefficiency, ineffectiveness, politics, um, yeah, committees.

SPEAKER_01 49:01

Yeah, yeah. Agree on all fronts. And final question: what do you think sets apart successful e-commerce entrepreneurs from those who give up, fail, or never get started?

SPEAKER_02 49:14

Massive action. Massive action. And stop focusing on uh top line and traffic and start focusing on the revenue. Here's the what here's the way I look at it. I map it this way revenue leaks first. You gotta address the revenue leaks. Because if you just keep piling in more and more traffic uh and more sales, you still have the same uh margin at the end of the day. So fix the margin. Then fix the conversion rate, CRO. Then traffic. Traffic is bloody expensive, right? Paid traffic, even organic traffic, you're still paying for content, content distribution, content creation, content optimization. You're paying for all that one way or the other. It's either lost opportunity cost or it's hard cost or both. So traffic is very expensive. It's essential. But don't address traffic until you first address the revenue leaks and then address the CRO. Optimize your site, optimize your products, optimize your um, you know, obviously your conversion rate. And you get into this a lot. This is what a lot of what you guys do. You know this. Uh, upsells, cross sales, thank you page sales, uh, LTV. I mean, you guys own this space. Uh so that's super important. And I wouldn't address trafficking until you address that, because you just, you just uh unfortunately wasting a lot of time and money, my opinion.

SPEAKER_01 50:35

I think that's really, really good advice and and music to this accountant's ears, uh, along with the rest of the people listening. So, DJ, thank you so much for your time today. And to our listeners, go check out the book. Uh, we're gonna post links to all that in the show notes. And DJ, looking forward to staying in touch. Thanks, David. Appreciate being on your show.