About Gary and LoudCrowd
Gary Garofalo, the CEO of LoudCrowd, has a decade of experience in the software industry. His second venture, LoudCrowd, is dedicated to helping brands build performance-based creator programs. They offer a suite of products designed to help creators monetize, including creator storefronts that drive sales to the brand's e-commerce site.
How LoudCrowd Helps Creators
LoudCrowd recognizes that it's in everyone's best interest for affiliates and creators to monetize better. Creators thrive on performance-based deals, where their earnings depend on how much they can sell for a brand. Brands, on the other hand, want performance-based models that allow them to invest more in creators and see attributable revenue coming in.
The problem LoudCrowd solves is the low conversion rates brands often experience when creators drive traffic to their e-commerce sites. Consumers following a creator on social media are there for the creator, not the brand. When redirected to the brand's website, the creator-centric experience is lost, leading to poor conversion rates.
LoudCrowd's solution ensures that when creators drive traffic to a brand's e-commerce site, the experience remains creator-centric, resulting in higher conversion rates. This approach benefits everyone: creators make more money, brands make more money, and brands can invest more in creator and affiliate marketing because the channel becomes more powerful.
LoudCrowd 🤝Boohoo
In a display of true hustle, LoudCrowd's team won the Boohoo account after an 8-hour overnight bus ride from Glasgow to London, having been unable to find accommodation due to the climate summit. Despite the arduous journey, they walked into the meeting and secured the deal – a testament to their determination.
LoudCrowd is now helping Boohoo lower their cost per acquisition, build large and scalable ambassador programs, reduce content costs through product seeding and gift cards, and ultimately drive higher attributable revenue through their storefront product.
The TikTok Ban
With the potential TikTok ban in the US, Gary is concerned about the impact on small businesses that rely heavily on the platform for distribution. He acknowledges the significant risk that TikTok may not be around in 12 months, but reminds businesses that creators aren't going away – platforms change, but creators will remain. If a business has found a successful distribution channel on TikTok, they should be able to replicate that on other platforms or a series of platforms that may emerge.
The recent news of TikTok potentially being banned in the US has sent shockwaves through the business world, particularly for the millions of small businesses that rely on the platform for distribution. When a business is still in its infancy, significant distribution disruptions like this can be challenging to recover from, posing a substantial risk to their survival.
Biggest Challenge for 2024
According to Gary, the biggest challenge brands will face in 2024 is finding reliable distribution channels. In the past, distribution channels were more consistent, but now they change rapidly. Brands not only have to create amazing products but also deal with the fluctuating distribution channels. Policies like cookie changes and skyrocketing costs on platforms like Meta make paid media challenging, and brands heavily reliant on big tech platforms struggle to stay relevant.
Even if a brand finds product-market fit, maintaining it may require significant adjustments every three or four years due to these constant changes.
How He Would Run an Affiliate Department
If Gary were to run an affiliate department from scratch, he would focus on partnering with professional counterparts in the industry, such as makeup artists and stylists for beauty brands. He has seen successful programs built around these influencers, who can provide authority and a focused audience, leading to fruitful campaigns for both parties.
What Creators Want Nowadays
Most creators driving revenue are now demanding cash commissions for performance-based programs. However, different creators in different spaces may have varying preferences, such as specific commission rates or product seeding. Gary recommends brands establish a feedback loop to ensure creators' needs are met and the compensation aligns with industry norms.
Commission Rates for Influencers
For an average brand in the growth phase, a 10% commission rate is considered the sweet spot for influencers promoting a €100 product. Challenger brands aiming for rapid growth may offer 10-25% commissions to attract top creators, while well-established brands may offer lower rates of 3-5% since consumers are already familiar with their brand.
Gary's Message to Industry Leaders
Gary's message to industry leaders is twofold:
Focus on creating amazing products that foster positive brand reputation, health, and word-of-mouth.
Be nimble and willing to adapt marketing tactics to the disruptive landscape. Embrace marketing risks, invest in influencers and affiliates as distribution channels, and get creative with partnerships to stay relevant.
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