This is an interview with Ed Higdon where we dive deep on how he started his business and we gain insights into how he thinks the retail industry is going to continue to evolve in a big way in the coming years.

Resources from this interview

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[00:00:00] Voice over: Welcome to the Ignite podcast, where we help marketers and CEO’s learn the latest tips, and tricks to help ignite growth in their business. This isn’t your typical marketing podcast. We push beyond platitudes to deliver you real world stories from the trenches. Are you ready to learn? Are you ready to grow? Are you ready to have fun? Well, then, buckle up, because you are about to enter the Ignite podcast.

[00:00:32] Alex: Hey, everybody. This Alex Membrillo, I’m the host of Ignite and today, I have the illustrious Ed Higdon on the phone with us here. He’s going to be sharing tips and tricks on how he’s grown his company. Without further ado, Ed I’d love to introduce you, why don’t you tell all of our listeners your name, and what you do, how you started your company.

[00:00:54] Ed: Hey, Alex this is the first time I’ve ever been called illustrious I think in my career, so I’ll mark that down as a something that I’ve accomplished. I’m Ed Higdon. I’m the president of Lift361. We are a marketing analytics company, helping our customers do three things. We help them gather, understand, and leverage data to drive sales. We work with large companies that have a lot of customer data to help them figure out how to sell you and your significant other more stuff.

[00:01:21] Alex: Ed, that’s really cool. Are you telling me that you run one of these creepy big data company that’s analyzing all of my activity all the time.

[00:01:28] Ed: All of the activity that you do, in store, online, on your phone, where you’re driving to, I wouldn’t call us creepy. We leverage the data to make your life better. Creepy people would do creepy things with data and we don’t do that.

[00:01:45] Alex: That’s right, that’s right. Hey, we’re in data too and as long as you don’t do creepy things with it. You’re good to go right?

[00:01:51] Ed: That’s exactly that.

[00:01:52] Alex: Give us a little bit of an example. We gather, understand, and leverage data to help drive sales. Are you allowed to tell us some of these phenomenal clients you work with or can you give us case study?

[00:02:04] Ed: Yes. Well some we work with– Actually I’m not suppose to tell you who they are, but we work with larger retailers, some nation and regional retailers that you would be very aware of, that you probably, you or your significant other are shopping at on a regular basis. It’s some of the things we help them do, understand when people are slowing down their buying behavior with a company. If you’re on pay path of buying say every once a month, we help them identify when you’re slowing on that path, and give them recommendations on how to intercept that behavior and drive more sales for one our larger retail clients.

Just identifying when somebody was slowing down, help them leverage that information and put a program in place to grab about $65 million an incremental sales for them in over 12 month period. Some other stuff. [crosstalk] Yes, there’s a lot of money. Even to get to help you on the creep factor. One of the things we’ve done recently is leverage cellphone data where people are traveling to help our clients understand where to put new sites and new locations.

We can go and look at a mall when we can identify where people are coming from the travel to that mall. We can identify how long they’re standing in places in that malls. We can tell them the best places to put a store in the mall. We tell them what types of customers they are. They’re young lower income folks, or they’re young professionals that have a little more disposal income, are they wealthy families, or they little income families. We can help them understand who’s coming to the mall.

A lot of good stuff going on right now. Lot of big data being collected. A lot of new technologies to allow people to analyze that data, and to leverage it to drive sales, and drive their business.

[00:03:33] Alex: I love it. If this isn’t too much of an intrusion, I’d love to hear some of the secret sauce. How do you guys know, who’s going to the mall, and what they’re doing in there.

[00:03:43] Ed: Yes. This particular case I was talking about, we’re leveraging a partner who has– Through some of the apps that people have on their phone. They’ve enabled and agree to let basically some people may not know that they’ve agree to it, but by leveraging those apps, those apps are allowing this person to aggregate data on a phone specific basis, and track that app, and track just through the GPS technology, where you are, how long you’re there. They’re able to identify your home by how long that phone is at a given location between say midnight and 4 AM.

If it’s there every night between midnight and 4 AM, they recognize that as your home, and they start to identify that, they can tag you there, so they know where you traveling on a regular basis. Like I said for us, and for that, for our data provider that information is anonymous, we just know it’s a phone, and we know where it’s traveling, we don’t know who that person is, or anything like that. It’s information we’re leveraging. It’s for our clients, and what they’re doing.

[00:00:38] Alex: I love it. Wow, this is really interesting. I’m sure retail, all of my retail marketers out there are going to love hearing these stories. Tell us a little bit more. We’ve got retail looking to expand. We’re hearing a lot dooms day scenarios out there with retail, all of the big brands are contracting, and Amazons taking over the world. What are you seeing?

[00:05:00] Ed: We’re definitely seeing a paradigm shift. I mean people are spending more in total, so retail it’s not going away, but it’s certainly is shifting the way people are buying. Most recently we had black Friday here a few weeks ago, this is the first time ever that there were more people shopping exclusively online than there were people shopping exclusively in stores. I think it was Adobe that reported that. I think it was 56 million people, shopped only online over the Black Friday holiday, and there was only 52 million that shopped in stores. We are definitely seeing a transition, where people are shopping more online.

They’re looking for more experiences than there are products. Amazon is a big push. It is a big issue for people to try to figure it out. We have some people that are trying to play with, and partner with Amazon like Kohl’s, who recently reported that they are now, and some of their stores agreeing to take back returns for Amazon. They’re like a return center for Amazon, and they’ve also allowed Amazon to have setup a shop in their locations for some of their echo devices and their home devices, so Amazon home stuff you can buy at Kohl’s now.

They partnering with Amazon to help that out, obviously for Kohl’s that will drive traffic. You see another people trying to compete in different ways. Basically, you’re going to have to, in my opinion anyway, you have to differentiate your business on experience. You’ve go to make people want to go there for whatever reason, they love to experience, it doesn’t mean putting a coffee shop in every location, anything like that. That’s everybody thinks we say experience, “Oh, we’ll put a coffee shop then people will come.”

It’s more about just creating experience they like, whether that means good help or great dressing rooms or whatever it is, that’s an experience they like. Or, you’re going to have to differentiate your products somehow. That’s just standard businesses. You don’t want to become a commodity, so you’ll see companies like Best Buy, that have their own brand of products where they’ll have special buys like, you can only get this certain Samsung TV at Best Buy. When I was in the shoe business many years ago, Nike would come out with a new Air Jordan and then for their larger retailers like Footlocker, they would come out with a color that only Footlocker could get, which would help Footlocker differentiate from little guys like me.

You’re going to see, I know you’re starting to see the transition of those things going on in the market place today. Obviously the online spaces is a huge place right now. We’re starting to see that marketing expand shift from the offline channels significantly into the digital space now, which is much cheaper, so people can reach more people. Lots of things going on.

[00:07:31] Alex: I love it. You mentioned two things there, retailers they got two ways they can survive, one through providing a better experience and two through providing a differentiated product. Let’s assume that the retailer go down that path, can they survive with what’s happening online? Do you see retails still thriving in 10 years.

[00:07:52] Ed: Yes. Retail as we see it today, will probably not be the same. 10 years from now it will significantly shift. We’re starting to see just the spending pattern shift. One of the sample we’re looking at right now is that sales on Saturdays for retailers seem to be falling. There’s a lot of ideas out there, hypothesis on why that’s happening, one of the blues we’re looking into right now is that with online, the ability to shop online at lunch, at home sitting there while you’re watching TV you can buy, that people are not having to go out on Saturday and purchase and with people looking more to spend more time with their family, and enjoy experiences they don’t want to be shopping on Saturday.

You’re going to start seeing shifts like that, but there’s going to be a shift online, the bricks and mortar stores are not going away. I mean people are going to continue going to stores, people still like to touch the clothes before they buy it. They still like to hold things and look at them and test them, and do some show rooming or purchasing there. I do think you’ll see a shift where stores become smaller, the foot print of the stores will become smaller, so I like to use Best Buy as an example because I buy some days with it, If I was Best Buy I’ll be trying to figure out how I can go into smaller stores where I hold less inventory.

You can walk in see a TV, it’s basically a show room say I want that TV and I’ll say you can have it today for a $1,000 or I will shift it to you, you’ll have it by this time tomorrow night or by 8 o’clock tonight, and you’ll have it, you can get it for $950, that allows them to inventory stuff in a less expensive retail location or a warehouse location in 30 miles from the center of Atlanta as oppose to in Atlanta. Makes it more cost effective for them, and it makes it a better experience for the customer. Things are going to shift, it’s not going to go away all together, but there’s certainly things going on. You look at all the grocery stores now, most of them have the ability to order online and pick up in the parking lot. You just pull up, people drop stuff in your trunk for you. that’s great, it’s great for the customer experience, but think about all they one off pick up items that people pick up when they go to the grocery store. You’ll end up with a pack of chewing gum, you end up whatever. Coca Cola that’s in the front, those things you pick up that are high margin items, retailers are not going to be selling anymore. There is going to be a shift, they’re going to have to figure out to make up that profit, how to become more efficient and more cost effective. It is going to shift But it’s not gone away altogether, not anytime soon.

[00:10:06] Alex: Yes, I don’t think it can go away, the experience is so important. I still think you’re going to have a lot of people go into shops at what they called Buckhead Atlanta or the Avalon, because you can go with friends and family. I agree, I think the retail, the actual spaces are going to become really small and nothing will be inventoried. They’ll take a 3-D scan of your body and mail your clothes out that night.

[00:10:27] Ed: That technology exists today and people can do that today. The other thing I think you’re going to start to see evolve is social shopping, so you’ll actually people will go shopping online together. Hey, what do you think about this, what do you think about that. They’ll figure out a smooth way for people to communicate while they’re still having the experience of shopping. They all will be together and there won’t be any mall, they’ll be in their bedroom looking at clothes together.

[00:10:50] Alex: I think that’s huge insight that is so cool. I never thought about that millennials and generation after us are totally fine with the Google Hangout and never seeing someone in person. I can imagine that they would group out together and then head over to Barnes and Noble or banana republic. That is so interesting, I never thought about that.

[00:11:07] Ed: There’s no doubt about that I watch my kids. I’ve got two daughters 16 and almost 14. When I was their age, I was out every day with my friends somewhere, especially when I could drive. I was out somewhere with them doing something hanging out with them, doing whatever we did. My kids hang out at the house, they hang out together do a lot of stuff together but same time.

I walk into the room like we do and I’m like oh I’m talking to Suzy. They’ll turn around and FaceTime or whatever messaging thing they’re doing and say hey dad say hello to Suzy and like Hey Susan how are you doing. They’re fine with that. To them they’re already meeting or gathering together. It’s online it’s just not in a physical location

[00:11:45] Alex: The world is changing and we got to keep up.

[00:11:48] Ed: Too fast man, it’s changing too fast for us old people. I’ll just say this old person.

[00:11:53] Alex: Yes, don’t include me in that.

[laughter]

Ed, I love it. You are one of the foremost leaders in retail marketing analytics. I can’t wait to share all of your insights with our listeners. Tell us a little bit about how did you start Lift361? Give us the crazy entrepreneur story. I know you got in you.

[00:12:10] Ed: Yes, crazy entrepreneur story. Actually I’ve pretty much always worked for myself, except for four years and that was a four year period when I was the CFO of a marketing company. As most entrepreneurs, you have probably more confidence than you should, more optimism that you should. My high school roommate and I worked together for this marketing company and he came to me one day and said hey we can do this better, stronger, faster than we’re currently doing it in the organization we’re in today and we should go to our own gig.

For me, that’s always work for myself and that was a passion mine worked for myself. That opportunity presented itself and we followed it quickly and started the company really in about six months. It just happened to be the same six months that my wife was carrying my first child. With my wife that was eight months pregnant, I quit my job went to zero pay [laughs] and started a company called Integrative Logic at the time that eventually we spun off the consumer insights and analytics group in 2010 and formed lift361 from that. That’s the crazy story, the crazy story is having the confidence to start it when your wife is quitting her job and eight months pregnant.

[00:13:20] Alex: Yes, with no income coming in, you’ve got a baby scream. I’m sure you are having to make cold calls and that baby screaming on your arm?

[00:13:27] Ed: [laughs] Yes, luckily I wasn’t the one in of charge of sales, but I was in charge of delivery. A lot of long nights and a lot of work after the baby had gone to bed for sure.

[00:13:39] Alex: Yes. I love hearing these stories and so you spun it off, you took the analytics piece. Do you love data?

[00:13:46] Ed: Yes. I’m a numbers guy and I’m going to separate that from the data. The more data you can give me that I can run numbers on, the more passionate I am about what we do. I’ve always been good in math. I believe people are good at what they’re passionate about or they’re passionate about what they’re good out. If it’s chicken or egg I don’t know which one it is. I love numbers and I love to play with numbers and I started out as a math major in college and went into my third calculus class. They start talking about imaginary numbers and I was like who can do anything with imaginary numbers? That makes absolutely no sense.

I literally got up out of class, walk ed across campus and change my major to corporate finance, so that I could do something with numbers that made the difference and mattered to people. It’s just for me, it’s a passion of numbers and understanding business and try to help their clients– our clients drive more sales and more money and more profit. That’s what keeps us going and drives us.

[00:14:41] Alex: I can see how your interest in finance helped with the data and analytics portion and driving more sales understanding the whole path of your clients. That was a skill that helped you launch lift361. Are there any other skills that you’ve seen go into making a really great entrepreneur? I know you’ve been CEO Peer Groups, for a number of years. You’ve had some crazy people in there. Out of the good entrepreneur myself not good at it. Can you tell us what skills go into making a really great entrepreneur?

[00:15:09] Ed: Yes, I’m not sure skills is the right word as much as it is traits. Some of these things I just think you have to have their innate to people. One of my hit on earlier I don’t know if the word is confidence or optimism. I think entrepreneurs for whatever reason that are having confidence that they will be successful and an optimism, that will always turn out okay. Having said the story I tell around that is, when we did start, essentially lift361 with my wife pregnant. To me it was a no brainier. I should go do this, this is going to work out, it’s fine.

My neighbors we’re good friends of mine, years later after things had taken off and we were making money and stuff. They would come to me and say, “Ed, I cannot believe that you rolled the dice like you did, did this when your wife was pregnant.” To me it was like, “Rolling the dice? I’m not rolling the dice, this is going to work, what are you talking about– Why wouldn’t you not do this? This is a no brainier.” I think there’s a certain confidence and optimism that entrepreneurs have that make them successful. I think there’s a passion that they have for their product, for a business, for running a business that keeps people going and makes them successful. For working with other people, for making other people successful.

I think that probably the third thing that is most important for entrepreneurs is their ability to adapt. Things change and we just talked about all the changes that retail is going through, all the different data sets that are now available and that, it will change tomorrow, and the ability to adapt and leverage that to grow your business, to grow your customers business. I think that’s a key piece for entrepreneurs. That confidence and optimism together with passion and the ability to adapt, I think that’s really what makes an entrepreneur successful.

[00:16:48] Alex: Yes, I couldn’t agree more and the underlying message is I think that you just said is, entrepreneurs feel like betting on themself is a safer bet than going and getting a job and betting on leadership at that other company to make things work out. Degree of confidence almost bordering on arrogance isn’t it?

[00:17:10] Ed: Yes it is. I think maybe this is part of it too. I think entrepreneurs like the thrill of the risk a little bit as well. I don’t know if it’s not that I’m not willing to bet on a larger company, it’s that there’s not as much risk in a bigger company, it’s not as much of a thrill for me. It’s more of the thrill seeking of manage my own destiny which is what you’re talking about. I agree with you, with everything.

[00:17:34] Alex: Yes, and you end up starting a business and working 80 hours so that you can avoid working 40 hours.

[00:17:41] Ed: [laughs] That’s exactly what it is. I’m pretty sure my average in my first 10 years my career was 80 hours. I think that’s probably pretty close.

[00:17:50] Alex: We want to tell your team. Now you’re only working how many hours a week?

[00:17:55] Ed: I’ve got a great team around me. I’ve been able to delegate a lot of stuff. Might be closer to that 40 hours and I am 80. I’m probably not at 40 but I’m closer to that than I am 80 for sure.

[00:18:08] Alex: You must have a really solid team.

[00:18:11] Ed: I’ve a solid team, we’ve spent almost 20 years building it. I’ve got a really solid team.

[00:18:15] Alex: That’s great. Tell us what has been the biggest learning lesson you’ve learned in your career, and don’t bullshit us on this Ed. Give us a real story of some really hard stuff that happened to you?

[00:18:31] Ed: Hard things. I’ve been through a lot. I’ve been through changing partners out and trading partners out and losing big clients and gaining big clients and growing people and losing people on all kinds of stuff. I don’t want to get too theoretical on you about a couple of things. The big thing is that every setback is an opportunity to grow. People talk about pruning your business and it’s good when you can go back in and prune a shrub. The reason you prune it is because there’s growth, it’s not as solid as you’d like for it to be, so you cut it back and you get better growth the next year.

Sometimes, that pruning is voluntary you go out and prune the shrub and sometimes it’s not so voluntary a big storm comes through and prunes that for you. Every setback like that is an opportunity to grow. I’ve had a number of those setbacks. If you have confidence and optimism, you don’t look at them a setback you look at them as opportunities to grow. It’s all about reshaping the next future for you, the next generation of your business for you when something happens.

You’re going to go through setbacks, you’re going to have issues, you’re going to have that person leave that you didn’t need to leave, you’re going to have a client that goes out of business. We had a large client that filed bankruptcy, came out of bankruptcy and was able to pay us about 75% of what they owed us. The next 60 days, they ran up a $300,000 tab with us and then filed bankruptcy again, liquidated and we didn’t see any of that money. That put us behind and it’s all okay, what do we do with this now? We have some warnings that come out of that. Everything that happens is an opportunity to grow, to learn and to improve.

I think that’s the biggest learning, we have a saying at my house, “when something bad happens, if that’s the worst thing that happens today, it’s a pretty good day” and that if you knock a glass off and you break it, well, if that the worse thing that happens today, it’s a pretty good day. Because, if a client leaves well, if that the worst thing that happens today, it’s still a pretty good day there are a lot worse things in life that can happen than losing a client, breaking a glass. We take things a little too seriously and sometimes I think you have to step back and look at really what– how that fits in the big scope of life and that’s what we try to do.

[00:20:50] Alex: Keep things in perspective at all time super important. Yes, it sounds like you’ve lost big clients, got big clients, you’ve gone through a partner [unintelligible 00:21:00]. I heard something really funny one time, there are good ships and bad ships but the worst ships are partnerships, are all partnerships bad ships? Or are there some good ones?

[00:21:08] Ed: No, there’s definitely good partnerships. I have two great partners right now. The deal with partnerships is you have to have somebody in charge, somebody that can make a decision. Everyone needs to know what everyone else role is, and you have to be on the same page. You have to communicate and that’s another thing you talk about what have you learned through business. One thing I’ve learned is that you have to have the conversation.

The worst conversation is the one that you never have, because if something is bothering you and something’s bothering your partner or not it’s probably bothering you both and they’ve got want take on it, you’ve got another take on it and you’re probably– you’re thinking that they’re thinking something, they’re thinking you’re something of something and they’re probably both wrong, have the conversation. Sit down to talk to people– most people, when you have a tough conversation, both people generally leave that conversation in a better place, and I’ve been through– You call them partner [unintelligible 00:22:01], I would call them spin offs or whatever.

Two of those ended in me losing good friends, which I’ve been working on getting back because we both had different angles of how the business will go and then the third one I had was a guy that was a little more– a little older and had a little more business focus and he was all about business. At the end of the day, partnerships at least in business that’s what they are, it’s a business discussion and most people will want to have those, you’ve got to remove the emotions.

[00:22:26] Alex: Which I know you’re really good at. [laughs]

[00:22:29] Ed: I have no emotions, if I’m dealing with– I have emotions, we’re all in trouble. [laughs]

[00:22:36] Alex: Oh, my goodness. Thank you for those lessons and I only have two more questions for you. Give all of our listeners, what book should they go pick up right now?

[00:22:47] Ed: The couple things, I’m not a huge– I am a huge reader, but I’m not a huge book reader. What I mean by that is, our business moves so fast and the technology changes so fast, by the time a book comes out it’s almost obsolete. I do a lot more reading just online, just your main marketing stuff blogs things like that. Now the one particular that comes to mind. To stay on top of the national news and things that are going on.

From a book standpoint in a business standpoint, I’m going to sound like the old guy, but you start looking at books like Good to great, Jim Collins wrote this whole concept around having the right people on the bus, just getting them the right seat has been a big thing. We talk about a lot in our organization. His hedgehog concept about time and things that you can do well and make money and have a passion for. That is the recipe for a successful business. If you can find something that you’re very passionate about, that you can do better than anyone else, that you can put a business model around to make money, that’s what a successful business looks like, I think that’s a big thing. Simon Sinek starts with why that’s nothing about for a number of years now.

It’s understanding why you do something not how or what but why you do it, drives a lot of our discussions internally not just for us but for our clients. Why would they want to know that, what are they trying to accomplish? Just from a business standpoint, Patrick Lencioni came out with the advantage three or four years ago, and it has a good way of just nailing down how you make your business, not a smart business as he says someone has smart people that– how to run the numbers and develop strategies, but as a healthy business that incorporates the culture into the business. I think those three books along with just staying on top of your– whatever you’re in, your industry, your business keeping up with that online and I think that that would get you all you need.

[00:24:32] Alex: I love it some of the tried and true ones in there, we believe quite a bit in the Hr concept and that’s what’s really help cardinal on sales. I’m with you there, okay, give our listeners one tip, What does the future of retail marketing analytics look like?

[00:24:49] Ed: Well, I think we talked a lot about it already, but retail analytics is all– what it’s going to do is it’s going to empower the customer experience, that’s what the future looks like. It’s what analysts want, it’s begin to come more and more automated, it’s going to be driven more and more by artificial intelligence and machine learning. You’ll have machines churning out rhythms in the background, that will create a better experience for the end user.

You’re talking about more posts of personalized content from a marketing communications standpoint, better offer, better product recommendations, better offers you’re more likely to buy. It’s going to end up with personalized pricing that’s where it will end up, several years down the road where you and I both gone to the same weight website to look at the product and they know that I’m tight and they are not so they’re– my offer is going to be for $10 and they can sell it to you for 12. You’re going to see that type of stuff happening which will probably offend people [laughs] that’s probably where it’s going to end up.

People have to manage that through– more people are going to feel like they’re being taken advantage of. They have to manage through, but the future of analytics and in the retail space or any other space, is going to be creating a more personalized experience for the end customer, because that’s what’s going to drive loyalty and sales that’s where it’s headed.

[00:26:03] Alex: I love it, I’m going to make sure that online I look like I have no money so I get the best deals everywhere I shop. [laughs]

[00:26:11] Ed: [laughs] Yes, you might want to create an alter ego that your online shopping ego.

[00:26:17] Alex: Alter ego? This is my real life.

[laughter]

[00:26:21] Ed: You might want to create one that’s less expensive.

[00:26:24] Alex: I love, Ed, thank you so much for being on Ignite. We loved having you, hey everybody if you ever want to get in touch with the illustrious Ed Higdon, we’re going to have the show notes after this, but you can go to lift361.com. Ed, thank you so much for your time today.

[00:26:42] Ed: Alex, it’s my pleasure, thank you so much.

[00:26:43] Voice over: Thanks for listening to this episode of the Ignite. If you like what you heard please leave us a rating and review, and before you go please remember to subscribe to this podcast, so you don’t miss the next episode. For more digital marketing tips, make sure you visit this is cardinaldigitalmarketing.com. Have a great rest of the day and don’t forget that the most important part of your job is to ignite.

[00:27:09] [END OF AUDIO]

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Ed Higdon

Ed Higdon, Lift361

Alex Membrillo

CEO

Alex Membrillo is the CEO of Cardinal, a digital marketing agency focused on growing multi location companies. His work as CEO of Cardinal has recently earned him the honor of being selected as a member of the 2018 Top 40 Under 40 list by Georgia State University as well as 2015 and 2016 Top 20 Entrepreneur of metro Atlanta by TiE Atlanta, Atlanta Business Chronicle’s 2016 Small Business Person of the Year,and the Digital Marketer of the Year by Technology Association of Georgia (TAG).

Cardinal has experienced exponential growth under Membrillo’s leadership, being consecutively named on the Inc. 5000 list of fastest growing privately-held US companies for the last three years. Membrillo’s innovative approach to digital marketing has transformed the industry and delivered remarkable results to clients of all sizes and markets. He has been featured in leading national publications including The Business Journals, Entrepreneur, Search Engine Journal, and The Wall Street Journal. He has also served as an expert speaker for conferences including the American Marketing Association, SouthWired, and Vistage Executive Leaders, where he spoke on his unique approach to Millennial Management to over 400 CEOs.

Alex Membrillo Cardinal CEO