Warm welcome to today's Partner Marketing Podcast, the story of MyBestBrands and the role partner marketing played in it. In today's episode, I'm speaking with Jörg Domessle, founder of MyBestBrands and formerly Poster. de. Jörg will share about his exciting entrepreneur background and give different perspectives on partner marketing from a publisher's view and from a brand's view. Let's get started. Welcome to the Partner Marketing Podcast.

Welcome to today's Partner Marketing Podcast. Today we will speak with Jörg about the founding of MyBestBrands and the connection to partner marketing. Hello Jörg, very good to have you today. Hello, thank you for the invitation. You are the founder of MyBestBrands. Can you tell us a little bit about the beginning and how it all started? Of course, I'm the co-founder. So in order to answer your question comprehensively, I have to go back a bit and that's important to understand for you and for the listeners. So I co-founded my first e-com company called Poster. de in 1997, sold it to an American competitor art. com in 2005 and stayed for another two years. And then I left in 2007 with a lot of learnings and in 2007 I joined some boards and invested in some startups.

But I realized that I really want to start a new business. A new company quite soon. And what I've learned from Poster. de or what I was taught by Poster. de was that I love the B2C business, that's good, but if possible without handling physical goods because running away hours are a lot of pain. And the same time I met a friend, a girlfriend, Moritz Seidel at a party and he was in the same situation. So he had sold his company, was thinking about what's going on next. So we decided to stick together and to explore some ideas. And I know. I don't know, maybe some of our listeners know the situation. You've got a bit of money, you've got enough capital in the bank.

You've got plenty of time, but you don't have a real good business idea. So I think we stuck together for around three months, you know. And the funny thing was, and it was really nice when I remember that you've got an idea, you are very excited. And then the next day you call the other one and say, 'no, it's not that good.' So that happened quite often. But then we realized that the timeless rule of combining. Combining strong brands with a special offer. This is compelling. And at this time, I don't know if you remember 2007, I think, did you join to create the word '2007'? July 2007. I don't know if you remember that the shopping clubs like Brands For Friends, they were really trendy and this was their growing.

And so we realized, Brands For Friends and brands. And good luck. And then we ask ourselves, why isn't there a service that informs me when my favorite brand or my best brand is on sale? And this was the beginning of My Best Brands. And My Best Brands focuses on luxury labels, fashion labels, right? Was that like that from the beginning? Did you always like, do you have a favor for this particular vertical or niche? Or was there any other reason? Why are you focused on these? Not at all. This was a strong learning curve. The only started, I think at this time, if someone had told me, I will do something with fashion. I said, no way. I'm not a fashion guy. So the idea was just strong brands and on sale.

So no matter. So we have fashion, we had tools, we had, I don't know, a lot of categories, even hardware, software, not software, but hardware, so a lot of things. So we've just started strong brand. No matter what category. And started this way. And then of course, we realized that it's too much, so we need to focus a bit. Then we realized that fashion is, so I think it was the best growing category. So we realized, okay, let's get a bit leaner. Let's focus more on fashion. I think that took us maybe a year or two years. And then after three years or four years, we learned that, you know, being in competition with just discounted fashion items and being in competition with the other ones and Zalando and some very cheap platforms, that doesn't make sense at all.

And this was a huge shift in strategy. I think it was in around 2015. So where I decided, I told my team, listen, let's get rid of all the, we call them partnerships or the advertiser or your brands. Let's focus on premium luxury fashion. Get rid of many of the brands. Get rid of the brands and the shops. And we just focused on the very best hundred with the premium and luxury sector. It was around 2015; it was 2015. And, of course, a complete re-launch of the website. So, it was really trendy the first time that we hired an art director. And for us, it was clear: let's go premium luxury. That's better for us than you know, being in competition with a broad range of platforms. If we go a little bit back.

Back to the beginning, because my background, as you know, is partner marketing and what you've done with My Best Brands is basically some sort of partner marketing as well, right? So when you launched your website, you had to connect to all these brands. Can you share a little bit on how that worked and maybe some challenges that you faced and how you solved them? Yeah, it's quite interesting because, as you can imagine, so when you start a marketplace, you need. You need partnerships and you're unknown, you're nothing, you're just you're starting. So that means, of course, you're in touch with the networks. And we started with the networks. We started on a CPO base and it was okay.

But then after a while, we realized, and this was quite strange, that so the target group or the traffic quality was quite homogeneous, you know, we generated for the brands. But then we realized, due to the CPO models, that brand A, you know, paid us a commission of 10 euro and brand B of 100 euro. So we realized that the risk is on our side. So at this time, I just had in mind, we're talking about 2011, 2010, 2009. So we realized that it's very strange and we depend on the performance and the customer trends in the shop. And then we said, okay, that's not good. So we switched to a CPC model. And I remember I was in charge, though I'm a co-founder of my friends, I was in charge of getting all the brands on board.

And I told them, listen, we switched from CPO to CPC. And they told me, no way, we won't pay you a CPO, we won't pay you a CPC because maybe you do some fake click-outs or whatever. But then after a while, we started with a very low CPC, they accepted it. And this was the breakthrough and very important for the whole business model to switch from CPO to CPC. Okay. In the beginning, you said that you acquired your first partners through affiliate networks. Was that the majority or did you approach partners directly as well to work with you? Both. So it was both. But of course, we started in the beginning, I think, if I remember rightly. In the beginning, first year, affiliation was around 8% from the brands.

And then it dropped down to 20%. And in the last two years, it increased up to 40%. Okay, I understand. How did you manage the other side? Because obviously, you connect all these partners, you get the offers in, I understand you filter them as well, right? Because you always wanted to have luxury brands or good brands with offers or with sales. But how did you manage the other side? So getting attraction from customers, consumers? Yeah. From consumers, having incoming traffic, because that's the base then, right? Yeah. So, of course, we're very much focused on SEO; we don't, we haven't had that much money. But also question for you, if you remember, so I think in 2009, it was, so the TV ads, you know, it started with this very small, with a small reach, whatever.

But I remember we had an investor. And they told us, okay, let's let's invest in TV spots. And very cheap ones. And we did it. And the attraction was quite good. So we get a lot of leads. And I think the mixture of TV spots, low, very low price TV spots, plus SEO, plus the combination of strong brands on sale, though, that helped a lot to attract to attract users. So the whole mix, basically, still, I want to dig one more deeper, because I, when whenever you you have an idea, and you want to. You want to set up a business, I think you always have a bit of this hand and egg principle, because you, you set up my best brand, you have the platform, you want to connect with all these best brands, but they have never heard about my best brands.

So, so, so I guess there is a challenge. On the other hand, it's obviously the traffic. So nobody knows it yet. You have no customers in. Can you share a bit more on in these moments where you were where it's this hand and egg principle? What do you do first? Because if you solve one, obviously, the other one gets almost solved by itself, I guess. But how did you overcome this step? It's an interesting question. And this is my phone at a couple of companies. And sometimes the less you think about the issues, the better it is. So what meant we started and, of course, SEO, we did a bit of SEO. And we did this TV ads. And for what reasons ever. So I think there was a strong mouth-to-mouth kind of movement.

And we had a lot of traffic. So I normally if I do the business plan, I think this one was completely wrong. Because after six months, nine months, we had really a lot a lot of traffic on the website. And I can't explain; I can tell you what were the exact measures to to get traffic on the website. But for what reasons ever it worked out. I remember that was the time when everybody was looking for the next thing on the internet. And there was like this word of mouth. Have you been there? Have you been there? And you had all these different communities starting as well, right? At this time? I remember when then connecting on the other side with the brands. How much has it helped you connecting with affiliate networks?

Because obviously, I guess that's a very good way of scaling a business, right? Being able to access brands at scale. Yeah. But to be honest, so for us, my our approach was to work. Directly with the brands, because we realized that it makes much easier. And maybe that's important to understand, I just will tell you a bit about the business model. So as I told you, we introduced the CPC, and we just had one CPC, we just I think we started with 30 cents or 35 cents, whatever. And at this time, I think we started with 80% network partners, and then we were very active in in acquiring new direct brands. And we explained to them our system. And they were very happy. And said, okay, pay CPC 30 cents, go for a try.

And then they realized that the traffic quality was quite good. And you know, when they calculate it down to a CPO, which they come out around 8%, 6%, whatever. So quite, quite good for them. And then he asked me, can I have more traffic? And then we say, sorry, I don't have more traffic. Then the second one is calling you and the third one and everyone wants to have more traffic. And then after I realized, okay, if a lot of people, a lot of brands want to have more traffic, you're too cheap. So that was the sign for us, let's introduce a CPC price model with different stages and different price classes. We were very creative in naming them with the platinum, gold, and basic and whatever.

And the idea was that the brand or the advertiser in New Speed, that he could choose the CPC class and the higher and the more paid that the more visibility he gets, according to our algorithm. And that worked fantastic. It was like on a stock exchange because they really, they called us, listen, I don't need some, I don't need some more revenue, please switch in the next CPC class. And it was interesting to see that when we started with 30 cents, I think now it's around one Euro. So the highest class you pay one Euro per click, which is quite a lot. And what I've learned from the competitors, of course, and from, from talks with our customers and the brands. That we are the one and only, they pay 80 cents on average per click.

From my own experience, I think I can imagine that this relationship with the brands maybe had different phases, right? So I don't know if I'm right with that. But in the beginning, they obviously were happy to have a partner to scale. A little bit later, there was often a bit of skepticism. Towards these marketplaces, because the brands rather would have preferred to have the consumers on their own page. And I think that was always like, at least from, from, from my experience working, working a bit in between on a partner marketing network side. Did you feel these kinds of like shifts in the perception as well that it was more convenient to work with brands at a certain stage? More skeptical? More skeptical, maybe careful at a later stage?

Did you, did you perceive that as well like this? No, not really. So we just imagine you have to be aware that we are in the premium luxury segment and this segment is very special. So you can't compare maybe with some, some of your brands or advisors who just want to get a lot of traffic. So that means, for example, my best friends, whenever we, and that was quite good that after a while, after two, three years, we were in the position that a lot of brands are quiet to be presented at my best friends. So we had strict rules. And I think the same normally do premium luxury brands at the network. They don't choose every, every publisher. And due to the fact that we are aligned with the target group of the brand.

So we haven't seen, I haven't seen this kind of conflicts. So it was the opposite. They really ask us, let's, let's work closer. Let's do some extra money. We can pay you for newsletter campaigns, whatever. So it was quite interesting that there was no, no, it wasn't like, like I've described. Very good. Very interesting. Yeah. To see that this is different. I think probably depends really, as you say, on the type of brands that you're done working with and then the philosophy behind that. If we go on now, maybe to the next topic, speaking a little bit more about partner marketing itself. You're in the industry for so long. Working with Poster. de, having like your own brand, then later on the creating this marketplace of my best brands.

How did you see partner marketing evolve over all these years? It's almost 20 years, I think, we've spoken, speaking, it was a completely, completely different time back then. Right? When you compare it to today, how did you see this development over time? So. So when I remember rightly, Poster. de, there was no affiliate marketing, we didn't do any affiliate marketing. And my Trade Doubler started in 1999. It was a bit too early, maybe. It was a bit too early. Trade Doubler started in Germany in 2001, I think. When did you start Poster. de? That was later. 1997. 1997, yeah. Okay. So it's a long time ago. Yeah. It was pretty important to us because we had so many direct relationships to the brands.

It's not that easy for me to give the right answer or a very good answer. But what I've realized that it was always a pain, you know, with the payments of the affiliate of the affiliate networks and the, and the brands. It was very difficult for us. You just get an amount on your account. You have no clue for what. And I remembered a lot of discussions, you know, with the affiliate networks sometimes, yeah. Why don't we get the money? What's going on, and then when you're listening for the validation from the brands, waiting for the validation, then the budget runs out, and so on. This was quite annoying, but it the annoying thing was the the finance stuff, the booking stuff, because you can imagine if you were managing director, if you got money on your account and you had no clue what for-it's easy to end, it's not that easy to handle.

But what's really good, and what I remember when I see that all the meetings we had, and this was really interesting that I think it started in 17, 18, 19, when we had a the team he was around 50 million in premium luxury in Germany, that we had really close relations to the affiliate networks. And what we did on my my sales team so we had a monthly call with them, we went through all the numbers, we asked, what is the benchmark, what are the competitors doing? And I remember that my team told me these calls are really helpful to go through the different brands' performance. Get some ideas what we can do, why we're not as good maybe like our competitors so that was helpful.

And of course all the the meetings and the conferences to meet everybody, it was was great and I think it's going much better now than I think when I remember 10 years ago, it was really painful to you know, as a managing director, always getting contacted if there's some trouble, and we had a lot of problems with this all payment stuff and tracking stuff. Um, we did a lot of test orders, you can't imagine how many test orders we did, and just to show that we really everything was sent out by our partnerships, but it's definitely, it was I think. It's now it's much much better than in the beginning between 2010 and 2015. Yeah, thankfully, thankfully there are a few things that are solved through the technology today that back in the day was giving us headaches.

How do yousee um partner marketing today in today's digital marketing landscape? So much has changed, you have big players obviously like Google, you have a lot of traffic sources that have made themselves independent, other traffic sources that are coming. There is always this innovation factor in the network where you have new business models popping up. How do you see partner marketing today from a marketeer's perspective, in the mix of all digital marketing channels? So I think it's it's gaining importance and so we call our shops, we call them partnerships, so there's a very close together. And I think it's um what's it doesn't make sense you know to cannibalize and to to buy traffic from from a public or to get traffic from a publisher, you're in competition with them, and with all the other channels.

And what I've heard and I had a lot of talks with our top customers so they told me, what makes mybestbrands so special is... and what they expect from a really good publisher is that they create their own community, that they have a high That a high new customer rate, and just to give you and the listeners some numbers, so that conversion rate, sales it was between 2. 5 and 5, and this is quite high with regards to the high AOV of around $250, and in luxury segment, was more than 2. 5 and 5 and this is quite high with regards to the high, more than 400, so and what we've learned is that sometimes, we also developed some some features with the luxury brands, and of course, also for me it was quite interesting to you know, to have meetings with Burberry and all these wonderful luxury brands, so we decided to go for a luxury um world, it's called so.

What we've realized and this is the learn curve and what I really like is that I remember when you visit for example, Salvado, and then you visit Brand so it was such a huge difference because Salvado or the P online players the multi-label, it was house, it was growth, it was let's get traffic, and then you visit a brand and every detailed counts, and they told me, 'listen, it doesn't it's the color is important, everything's important. So what I've learned in my takeaways from all the the meetings with this luxury brands well details matters that is uh that was a huge difference but so what you've learned from is a big brand um big brand perception right a big brand. I identify that you need to respect as well, right?

And then we realized, and I think that's important also for the publisher who listens to us. You need to understand your main, your main brands and your main um advertiser, so what we've learned and this changed a lot. But I remember around into 15. So, the luxury luxury brand they told us we want to be next to the other brands can't, can't you create an own section, yeah, and then we did it and it was great that you haven't. It's called Luxury World, and it still exists and there you see just goods from mono-brand stores so no multi-label and I think that's that's important if you if you're everyone has got his target group and in premium luxury it's a very special Target group and if you as a as a platform generate traffic for your for the most well-known brands you need to think a bit like them and your target group so there's a lot of overlaps and I think.

And then the most important thing is be selective, like the luxury brands don't take everyone, and if I you know if I run the platform and accept every request from every cheap brand that doesn't make sense at all. You have a lot of experience and you see, you can see partner marketing um not only from a publisher Marketplace view but you can of course see It as well from a brand side, do you see big differences in the needs and in the challenges from these two perspectives? Um, as I told you so, I I just know that the premium luxury segment, and I think so, but yeah, they are, and they ask us, please deliver high-quality traffic. And what does it mean, high-quality traffic, you know, high new customer right, high AOVs, and that's they're happy with them.

Of course, as you also know, new customer right, and so I'm not just for a month so throughout the whole year and throughout years. And this is I think this is also something special with my wish plans, and what you're just asking me if you, if you're in the position to be a reliable partner a reliable publisher who delivers a very good quality steadily just no Peaks like many others so that the advertiser go on and off and on and that doesn't happen with my friends so they relied on us and they told us sometimes it was really strange in the beginning of the year or at the end of the year they asked me what's your budget for next year because we also have to budget so we can calculate your revenue and what are your plans and I think that's maybe the big difference be really focused on on on your target group and on the needs of their of the brand so in the connection between the Publisher Marketplace and the brands I understand from what you say, trust transparency communication um are key topics what else is important in order to keep these relationships as good as possible, so I think that the conferences are quite important it's you might you know they're huge conferences from from your competitors and there's something basically being visible being there talking to the people talking to your advertiser talking to the people from the network and yeah so I remember a lot of meetings especially you know with the fashion weeks combined with the fashion week in Paris or in Milano then. You meet, you have a nice dinner with an organized invited by a network, I think this was really helpful and that that's good for the for all three of us, for the network, for the publisher, and for the brand, so I think that's that's quite important that's maybe a bit underestimated by by some networks um but it's worth so basically everything that applies in any kind of normal relationship applies as well for the relationship between publishers and Brands yeah right would you say so yeah yeah I would say so and of course it's it's so super important that you know, our contact person in the networks that they understand the Work or system, potential, or a target group-our methods. How we can, how we can change the algorithm if they have the right understanding then it's easier for them to know, to present my friends to the to their brands and that's not that easy. I don't know how many people call us, you know all the guys who want to offer your software solutions, whatever they all thought we were a shop but we aren't a shop um so yeah good communication and honest and trustful combination that's that's important.

Good um say, looking at digital marketing on a broader level um with all the different new topics going on what do you see as the main Trends, um, what do you think is important and will be maybe even more important in the future now so I think, I don't know how long it will take that Google will die or whatever if you don't need to invest in SEA in whatever way so I think as a shop, SEA is important. SEO is super important, especially with us with the low margins um, but of course, I think this influencer marketing and social marketing, especially in the in the sector of fashion, that's quite important or even more huge right, especially the growth rates of influencer marketing and the influence and the value.

I'm always surprised again when I see the value and and the conversions and order value that certain influencers can drive for brands is is crazy yeah that's crazy but but this is um I think that's especially for my brand because we are platform and we are not the owner of the products and we are not you know if you sell a pair of shoes for a thousand euro maybe the cross profit is 500 and if we sell you a click for a euro that is not that much much in absolute euros plus we don't know the owners of the of the photos and of the goods so what we did we tried some corporations with influencer but we've learned that the sales conversion rate was too low and the costs were much too high but I think I think this is just special for us as a as a platform yeah um but for a brand or if you have higher margin I think that's uh of course when you're in the fashion world that's that's really important and I'm I'm keen on knowing or I'm keen on seeing how much AI will you know will push the whole the whole sector here is that something that makes you excited is it something that worries you some people say that might be as well the end of the open internet and you will have only one interface that you interact with or do you see rather more possibilities there no I'm totally excited and I use it quite often and I think it's great Yeah, but I really I don't know if if I now I don't know if I if I opening a new a new online platform a new online shop.

I think the search and the behavior and the customer will change completely so that means the good old SEO and the good old SEO maybe we don't need it anymore in a couple of years. But in general, I like it very much. We see a we see a big shift in different traffic sources um in the network and that's rather increasing um instead of going down. But again, maybe because you said that as well before um that you think that partner marketing will gain importance and that's probably one of these driving forces that we have. behind that but which impact does AI have on your business we think it will create new opportunities for us um I think on the one hand obviously most of the applications that we have today is rather efficiency focused so we will find it easier partner marketing in itself I guess as you know is relatively labor intensive because you have so many people you have all these different relationships that you need to manage you need to take care of all the different needs nevertheless with AI we have the opportunity um to do many things in more automated ways like um for example suggesting partners suggesting Publishers Fraud detection custom reporting, all these kinds of things become much much easier. What will be seen where we have never seen or I have any example yet is AI applications that drive more revenue. At the moment, everything is very much efficiency focused, but I'm sure that very soon there will be first tools and first functions and I'm really looking forward to that. And that's something I'm quite sure that we will see first in the network right because we have all these small entrepreneurs, all the partners in the network that come up with new stuff, so we're watching that very closely here.

I may ask a second question, I know you're the one who asked me, but you know when I prepare this I ask myself, partner marketing affiliate marketing. I think what we all know is affiliate marketing and you always talk about partner marketing. What's how do you define partner marketing and what's the difference to the classical affiliate marketing? The affiliate marketing term we think that is the one you want to be on the market for the most part, we think it's kind of like an does not really give justice anymore to what we do. Because back in the days, you had some big players that were providing traffic and then you have a lot of affiliates or relatively small companies that were driving traffic, entrepreneurs, individuals, very creative.

Nowadays in partner marketing, as we call it, we work with very big companies. So some of our partners like Payback or Klana are listed companies where we think that the term partner fits much, much better than the term affiliate because, as well as you said, so because of this topic, but because as well, because of the connection between these partners and the brands. It's very sophisticated, very high-quality connections, discussions about how to drive business, how to do partner marketing. So this partner aspect, I think, is even becoming bigger. And then we see basically different channels. We have this business model where you have somebody like JW in the middle. We provide the tracking, we provide the transparency, we provide payments. On the one hand, then we have brands, advertisers.

On the other hand, we have partners, publishers, affiliates. But there is different categories now. So we have a certain offer only for influencer marketing. So the partners are influencers instead of the classical partners that we have seen in affiliate marketing. We have pure mobile or app-focused partners. And we have all these different categories. We work with media houses. And because of this involvement in this ecosystem, I think that the term 'partner marketing' is the right one. Now it's broader, broader and maybe even a little bit more professional. Makes sense. That's where we're coming from. Thank you very much, Jörg, for sharing all these insights and perspectives. I have three final questions at the end that I ask every guest of mine. Is it okay if I ask them to you too?

Yes, of course. What is, can you share with us, what is the best book you've ever read? And that you would recommend us to read? The best book. So I don't like that much reading non-fictional books very much. So I love novels by German-language authors. And I finished, two weeks ago, I finished Arnold Geiger's Journey to Locarno. And Arnold Geiger is an Austrian author, one of my favorites. And what I've loved and what I liked is how he knows the language, A and B, how he embedded the dream of Karl V with historical events. I think within his last few days when he was, before he passed away, he saw the constellation in good language. And historical events plus, you know, get that mixed up with the dream, that was quite impressive.

So everyone who is interested in the Middle Ages or in the 16th century of Karl V, I strongly recommend reading Arnold Geiger's new book. Very good. I will; this is, my podcast series here is getting my main source of inspiration now for reading, so I always check it out. The same goes for any tool or app that you can't live without and that you would recommend us to have on our phones. It's a rather private one, again. Of course, I use all the news and then bank and whatever and whether. But for me, music is quite important. And I love discovering new songs and new albums from indie to hip-hop. So my two favorite apps are Ego FM, the radio station, and BBC One Extra.

And what I do, I think it's been 10 years, I create my own playlist quarterly. But really hard work, so it's not with just tell me Spotify. So I really listen to different radio stations, the two are the best. And then if one song is really convincing, I put it in my playlist. I check the playlist and then I close it. And the funny thing is when I listen to maybe to the playlist Q1 2015, it mirrors you, the mood you were in at this time. And yeah, music is important. So Ego FM and BBC One Extra, these are my favorite apps. That's good. Cool. And then another rather personal one. If you weren't doing what you've done, so being an entrepreneur, setting up Poster.

de and then afterwards My Best Brands, if you would be free from all of that, what would you be doing? That's a difficult one. So of course I know I'm doing, I've got a new job and this is really, I spend a lot of thoughts what to do. And this is, I really enjoy this, but this is not the question. So I discovered my passion for swimming. A year ago. And what I'd love to do, I'd like to do, I'd love to be surrounded by kids, by young kids because they are so intense and they live in the here and now. And teaching kids how to swim in a different way. And this, I'd love to do that. Maybe I will do it someday. Nice. Thank you, Jörg. Thank you so much for sharing your insights and experiences with us in this podcast. Thank you for being my guest. Thank you. Thank you, Matthias. Bye-bye. Bye. Thank you very much for listening to this episode of the Partner Marketing Podcast. Stay tuned for the next session. You find us wherever you get your podcasts.