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Ep. 117 - Personalization is the “New Normal” for Ecommerce with Ben Parr

Ben Parr is President and Co-Founder of Octane AI, a platform to fuel brand growth and personalization. Octane AI powers engaging quizzes, data collection, and personalized Messenger and SMS automation. 

Ben is the author of "Captivology: The Science of Capturing People's Attention" and a board director of the non-profit Samasource. 

Previously, Ben was the Co-Editor of Mashable, a columnist for CNET, and a venture capitalist. He has sat on the advisor boards of Lufthansa Airlines and various startups.

He is a member of Forbes 30 Under 30. 

In This Conversation We Discuss: 

  • [00:00] Intro
  • [00:38] Sponsor: Klaviyo klaviyo.com/honest
  • [01:49] The personalization “rabbit hole”
  • [02:25] Post BFCM week debrief
  • [03:10] The power of Octane AI’s Shop Quiz
  • [04:57] Having an online “concierge” to your store
  • [05:50] The reason why Octane made Shop Quiz
  • [08:04] Sponsor: Avalara avalara.com/honest
  • [08:53] Shop Quiz adapts to your website
  • [10:33] How to prepare Shop Quiz
  • [12:57] Sponsor: Gorgias gorgias.grsm.io/honest
  • [13:47] Dynamic copy Shop Quiz integration soon?
  • [14:20] Tools that are better for the customer
  • [15:51] Forgetful shenanigans
  • [15:59] Shop Quiz Klaviyo integration
  • [18:03] Good integrations print you money
  • [18:42] Sponsor: Rewind rewind.com/honest
  • [19:19] Quiz opt-ins vs traditional pop-ups
  • [21:18] Shop Quiz future integrations
  • [22:28] Chase highly recommends Shop Quiz
  • [24:24] Ben’s first Shopify Unite
  • [25:03] The Ecom ecosystem is fun
  • [26:15] Where to find Ben
  • [26:45] Personalization will be the Ecom standard

Resources:

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 Transcript:

Ben Parr  

Personalization, I feel, is the key to a long term sustainable future for commerce in general.

Chase Clymer  

Welcome to Honest Ecommerce, where we're dedicated to cutting through the BS and finding actionable advice for online store owners. 

I'm your host, Chase Clymer. And I believe running an online business does not have to be complicated or a guessing game. 

If you're struggling with scaling your sales, Electric Eye is here to help. To apply to work with us visit electriceye.io/connect to learn more. Now let's get on with the show.

Sponsor: Klaviyo

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Klaviyo is the ultimate marketing platform for ecommerce. With targeted segmentation, email automation, SMS marketing, and more… 

Klaviyo helps you create your ideal customer experience. 

See why Klaviyo is trusted by more than 50,000 brands, like Living Proof, Solo Stove, and Huckberry. Keep your customers coming back. Get a free trial at klaviyo.com/honest. That’s K-L-A-V-I-Y-O.com/honest.

Chase Clymer  

Hey everybody. Welcome back to another episode of Honest Ecommerce. I'm your host, Chase Clymer. And today we're welcoming to the show Ben Parr, one of the co-founders of Octane AI. You definitely have heard of them this holiday season. 

They just released an amazing quiz feature that I know we're gonna talk about a little bit here about how it's been helping their customers get more personalized information about them to which then allows your store owner to send out more personalized messaging in all of your cool outreach things. 

But I'm talking a lot right now. Ben, welcome to the show. How are you doing?

Ben Parr  

Thank you for having me. I'm excited to talk [about] all things quizzes and more.

Chase Clymer 

Absolutely. I mean, I'm a huge fan of quizzes. And I've been definitely down the rabbit hole of personalization forever. One of the first guests I had on the podcast... Are you familiar with Brennan Dunn

Ben Parr  

Yes. Yeah. 

Chase Clymer  

So I've been... This has been top of mind for me for forever. And heck. Backstory on me. I went to the Double Your Freelancing Conference 5 years ago in Norfolk, Virginia. And that set me on this whole crazy, entrepreneurial tech adventure. So shout out to Brendan.

Ben Parr  

Nice. That feels like a lifetime ago. 5 years ago? I don't even know what the world was like 5 years ago. I don't even know what the world was like 6 months ago.

Chase Clymer  

Yeah, that's true. It's been an interesting year. And now that... So we're recording this for everyone that's listening, --probably in February I'm gonna guess?-- we're recording this a week after Black Friday and Cyber Monday

And just now that we're starting to see the results of the campaigns for our clients and the sales that happened, it was everything they said it would be. It was wild.

Ben Parr  

Yeah. We had a huge... We increased the amount that we drove in revenue to our customers by over 6x. And it was crazy to see. 

And the thing is, I think that number, that multiplication can be even bigger for next year because we only just came out with our quiz feature. And that's already driving like 20% to 30% of the revenue of a lot of our customers now.

Chase Clymer  

So I guess let's start from the beginning. Let's get your backstory real quick. Let people know why they should listen to what you have to say today.

Ben Parr  

Sure. So hi, everyone. I'm Ben. I'm the president and co-founder of Octane AI. In a previous life, you may know me as the co-editor of Mashable. I also did a whole bunch of other things from investing to writing a book for HarperCollins called Captivology

But Octane AI is the buyer profile platform for the world of Ecommerce. And so what that means is that we have a set of products --specifically our Shop Quiz-- that help you learn about your customer and guide them through the purchase journey so that they can help get a purchase. 

And so it's very similar in the way of how an in-store concierge or associate helps guide you to purchase and learns about your means and learns about the things that you have to consider and makes recommendations. 

And that's such a core part of retail, but it's not at all a part of Ecommerce. You mostly are thrown onto a website and it's just basically like being thrown into a warehouse. 

And we built the Shop Quiz to make it so that a consultative experience [is] on your site. And really, it's just like a guided shopping experience. Quiz is even almost a limiting term. 

But it learns about the customer, you can build the logic, give product recommendations, and... Then these customers buy at like a much higher conversion rate than your typical, what, 1% to 2% of the Shopify store. 

Ours is 7% to 15%. And then now that you have this information about what they're looking for, what their size is, maybe their allergies, whatever is core to you, now you can leverage that data to personalize everything else about the customer journey. 

As an example connected to something like Klaviyo so you can personalize the email segments that you have. Or we have Messenger and SMS as apps on our platform. 

And you can connect those and personalize the messages that you send out on those channels too.

Chase Clymer  

Yeah. That's an extremely powerful tool to have in your arsenal there. And I guess I'll unpack it a little bit here. I liked your analogy of talking about how a website and Ecommerce store these days is like being thrown into a warehouse. That's pretty spot on. 

You don't get that concierge support of a retail associate that really understands the product selection that they have and can quickly tell what a customer is looking for in like a few exchanges in less than a minute. 

They're like, "Yeah, you should probably take a look at this." That's what's gonna happen in a store when they have a sales associate that's good at their job. Recreating that online [is] super hard. 

I know that they were trying... Some stores and some businesses try to do it with live chat. But it's a little too, I would say, resource heavy. It's human capital heavy. You can't have enough people if your store is doing good traffic.

Ben Parr  

So actually, that's what... The reason we did the Shop Quiz is because a lot of our customers were hacking our Facebook Messenger product, the product we started out with. We have a Facebook Messenger platform. 

It does really well and prints lots of money for stores. But last year, they were all... Which [is on] 2019 for everyone out there. At the end of 2019, they're all hacking it to do a Fit Finder chatbot or skin routine recommender chatbot or something like that. 

They were all hacking it. And we asked them, "This is super interesting. But why are you doing it? Wouldn't it be better if it was part of the site itself and it was on the website?" And they said yes. 

But the only options we have are either to custom build something --which is expensive, doesn't improve over time, doesn't have integrations, doesn't have a dashboard, doesn't have analytics, or use something like Typeform, which is a form builder, a great form builder, but not actually really integrated with Shopify. 

They're not built for product recommendations, they're not built for Ecommerce, not even that really easy to update the design. It looks like a Typeform. 

And so we talked to our customers about this and they had this huge problem and we saw this clear hole, that absolute problem that our customers are having. And that's [where we said] like, "Well, this is a conversational product, right? This is like a conversation on the site. Really, right?" 

We are experts at conversational marketing. And so we built the Shop Quiz, because it is like part of the on-site conversational experience. And it does... It's not like "Here's a random chat bot that you're gonna ignore." 

It looks and feels like part of the website, which is the way you want it to be. And yet it is a conversation they're asking. You're asking a question. It's coming back and forth. And that's part of why the conversion rates of that are so high for a lot of the stores.

Again, the average conversion rate of a Shopify store for example is under 2%, which is crazy when you think about it. That's so much opportunity if you could even increase it by a single point. 

You would be increasing revenue by 50% or doubling it even. And so it made super clear, sense to give this product that can really give the customer what they're looking for. 

And the conversion rates for our quizzes are 7% to 15% plus. It's like a remarkable increase. I think that's part of one of the many things that have been super interesting to learn since we launched the quiz earlier in 2019. 2020, I should say. 

See, I don't even know years anymore.

Chase Clymer  

Yeah, it's all blurring together. 

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Chase Clymer  

So I know that this is probably gonna be like a question that most of the listeners are going to have and it's... 

Part of the Shopify ecosystem is this app ecosystem. And one of the major drawbacks with a lot of them, unfortunately, is when you plop them in your site, it just immediately takes you out of the experience. 

It looks like it doesn't belong. So how customizable is this for me? I've got the... My website's my baby. I've been working with this agency partner forever and we built this cool, sexy, awesome thing. 

Can I make your product, this awesome recommendation engine, this quiz app, can I make it look and feel like it's part of my site and part of my brand?

Ben Parr  

Yes. And that's one of the big things we focused on which is 1, it automatically inherits all the fonts and themes of your website; 2, you can customize everything from the look, the images, the feel, the direction... 

And we're coming out with more and more of the minutiae of customization every single week. Because the whole goal here is to make it so that it's indistinguishable from your website. It is just part of your website. 

It's like something that doesn't slow it down. It's something that makes it super easy to consistently update. So you get all the benefits of having something that is custom-built. It looks and feels purely custom-built. 

[We] have all the unique little things that make your site your brand and your brand your brand, but also have the power of SaaS, have the power of integrations, of an ecosystem, of apps, of dashboards, of analytics and...Oh, [it's] actually leveraging that data to do really, really powerful things. 

That's like... That was the whole mission of the Shop Quiz in particular.

Chase Clymer  

Awesome. Awesome. I know that we've got this slated on our to do list for Q1 next year for a few of our clients. But I'm just gonna pick your brain now for it because I can. 

And that's the power of having this podcast. I get to do these cool things. So a lot of brands out there, a lot of Ecommerce brands... Fashion is really easy or it's close to what they sell and it's easy to understand that. 

So let's talk about a use case for a women's fashion boutique. I'm sure that's a very easy use case for a lot of people to understand. 

So if we were going to install a Shop Quiz on the store. What's the process going to be like? What are we thinking about? And how is it gonna help this brand?

Ben Parr  

So the number one thing to just think about are "What are the questions you need to ask?" And that's actually the hardest part. 

Actually putting up a quiz and putting the elements of the design around it are actually not that hard at all. It's just the actual logic you want to have for your quiz. Luckily, for most industries, it's super clear --the kinds of questions you ask. 

If you're a fashion boutique, for example, you're gonna probably be asking about... We have customers that ask about size, they ask about color... They ask, "Are you buying for yourself or for somebody else?" 

This is a really important question to ask that helps you [to] really segment those customers. They ask for what kind of thing you're looking for. Some people are looking for dresses, some people are looking for boots, whatever it might be. 

And then... Or maybe an outfit as another example. You could actually put together an entire outfit with a Shop Quiz, which is another advantage. You can actually recommend a set of products and increase your AOV by doing that. 

And then when you ask these questions and it spits out the sets of results that you've set up and you've designed. And so again, it really depends on your brand and on your vertical. 

You just have to ask yourself, "What do I really want and need to know about my customer?" And "What do my customers consistently ask me to help make decisions?" 

If you're a beauty [brand], for example, a lot of it [are questions for] allergies, or "What kind of skin tone do you have?" and "What kind of products are you looking for?" They're very similar. 

Even if you have one product, you could still really leverage and should leverage the Shop Quiz. 

For example, if you have teeth whiteners, you might ask questions [like] "Do you smoke? Or "Do you drink coffee?" Or "Do you do these other activities?" 

Because that will help actually change the copy of the quiz so that you can give a better sales pitch. 

But also then, now your email segments and your messaging segments can be really tailored based on "I know they have this specific issue."

This is the selling point that I need to really emphasize to have them continually buy it or send it to their friends..." Or what have you.

Chase Clymer  

Yeah. That's super powerful. 

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Chase Clymer  

I'm just gonna guess this is on the product roadmap, but please correct me if I'm wrong. What about dynamic data to affect the copy on the website? So using these tags... 

So let's say I do the quiz on a menswear site. It knows my look that I'm going for. Can I dynamically update the elements of the site in tandem with the responses on my shop quiz?

Ben Parr  

I will say stay tuned and I will say Feel free to DM me on Twitter if you're like I really like that idea.

Chase Clymer  

Everybody, we're on video and I can see just the biggest smirk on Ben's face. But that's all we can say.

Ben Parr  

You said everything.

Chase Clymer  

Yeah. Alright. Alright. Alright. So let's say we get this installed and we're asking the right questions and  it's like you said. It's the questions that your customers are already asking. 

You can just ask them and let them self segment. Let's talk about the coolest integration you got: Pushing all this data over to Klaviyo. 

You touched on it here by tailoring the message with the smoking example. Say if you got teeth whitener, you can talk about "Oh let's get rid of those tobacco stains on your teeth." 

You can just make that dynamic subject line be in all the emails. What are some other ideas for people so they can start thinking outside the box of "What can I do with all this cool powerful data I just acquired for my customer?"

Ben Parr  

I think [the] first thing... [The] reason you're doing this is not just because it's going to increase sales, but it's actually straight up better for the customer. 

And I feel like a lot of products in Shopify, and just in general, are good for the business but not as good for the customer. They help you spam a customer or something like that. 

This is actually one of those rare products where it's actually better for the customer. It's actually giving them help first. "I need help finding something." 

And then the byproduct it actually also helps you have a better experience every time afterwards. Because again, if I'm 18 and I have oily skin, I do not want to get the same email. 

And I don't want to have the same product problems as those who are in their 30s or 40s and have dry skin. And I should be reflecting that as a frame. 

In the same way that in the store, [if] someone comes back and you know the person as the concierge, you're going to be like, "I know exactly what you're looking for. Come over here. We don't need to go and waste time. " 

That's like our philosophy [of] what we're trying to really replicate, right?

Chase Clymer  

Mm-hmm.

Ben Parr  

 And so... (laughs) I went on that tangent, I'm almost forgetting the original question. (laughs)

Chase Clymer  

I mean...

Ben Parr  

You're like, "I don't even remember either."

Chase Clymer  

Ah! You know what, I forgot for a second. But I do... The question was what are some more powerful ideas... You have all this data... And specifically with Klaviyo, was where I was going. Because let's be real. Klaviyo is an amazing piece of software as well. 

Ben Parr  

It is. And that was the first integration for many obvious reasons for us. So I'll give a specific example here. So Doe Lashes does beautiful lashes. 

They have a beautiful quiz where they're asking about the kinds of lashes or what you're looking for. They even have a fun question where they ask... 

They want to find out your age, but they don't ask for your age. What they ask is "What's your favorite cartoon?" And they actually learn your age. Because it's like, "Was it Sailor Moon? Was it Teen Titans Go?" Depending on your favorite cartoon, you're going to be in a different age demographic. 

And then after that, --the question that actually came to the Klaviyo piece-- they asked us other questions I didn't think much about which is like, "How often are you using lashes?" 

And what they found out was the number one segment was actually people who had used lashes [that] never used lashes before. It was their first time and they were super shocked by this because they thought their customers were all experts. 

It's one of the many insights [that] they learn from their quiz that you wouldn't get otherwise. So they learned this thing about their customers and they're like, "Holy crap! We need to do something about this." 

And so they built out a whole Klaviyo segment of education, educating the customers in this specific segment: On lashes, on how to use them, on the benefits, all sorts of things. And that really helped upgrade and transform their business. 

And so that's one of many examples. You can imagine... Yeah, you can send a blast that's based on... They're in these different buyer profiles, but you could use that information for a more detailed education. 

Or you can even use that for specific kinds of follow ups because you can combine that data with how often they bought. You might be able to say "You're a VIP and you can have these special perks. 

We know that you're looking for this kind of thing." or "We can give you a discount on this specific product." So there's a bunch of different examples. 

The Doe Lashes one just always sticks to mind because it's something they didn't know before, then they learned it, and then they could use the Klaviyo integration to do something that was actually really also beneficial to the customer, which is education.

Chase Clymer  

Oh, yeah. The second you said that all of their customers were new customers and first timers, I was like "They absolutely built just some amazing educational welcome series like that." 

That probably just printed money for them at that point.

Ben Parr  

Oh yeah yeah. Tons. They print money. I think somewhere between 30% to 40% of the emails they collect are from the quiz. 

They 3X'd their email collection using the Shop Quiz because people are much more likely to opt in because they want to have the results and they've gone through the whole thing. 

And you don't even have to go and offer a giant discount to get the quiz which is what but most pop ups do. This instead, it's just like, "I'm going to give you a value." They put in your email and they're very willing to do it.

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Chase Clymer  

No yeah. That was my next question. What a great segue. Let's talk about the benefits of using a Fit Finder or a style finder. 

That is essentially what these quizzes are. It can be anything like that. You're just acquiring information about your customer.

What is the lift on opt-ins for new email subscribers using something like that versus your traditional pop up?

Ben Parr  

It depends... Also, we have a couple examples. The most extreme example...And this is not going to be what most brands have. Bariatric Fusion with their Shop Quiz. 

They increased their opt-ins by 16X compared to their topics before. A remarkable increase in the options that they received. Doe Lashes was 3X. 

We see multiple increases oftentimes. But like even one... Even a 10% or 20% would have a giant impact on your business. But if you're promoted... The big thing is if your quiz is front and center, you promote... 

It's part of your homepage or you're linking to it from your top nav, a lot of people are gonna just give you their email, or their phone numbers, or their messenger IDs, all of which we support. 

And you're going to be able to automatically do those follow ups. You're gonna be able to sync those emails to Klaviyo, or send those text messages or those Facebook messages through us, or do whatever else you want to do with that data.

Chase Clymer  

Yeah. My wheels are spinning on this conversation. I'm excited to dive in and help some of our clients with this. At the end of the day, it goes back to marketing and advertising basics. 

It's like, the more spot on the information that you present to your customer is about their unique situation, the higher the return is going to be, the higher the response rate. 

If you're talking about direct marketing, it's like the more in tune your message can be to your customer, it's going to help sales but we just can't overlook the fact that your customer is also having a better experience, because they're like, "Wow! This brand gets me."

Ben Parr  

Yeah. It's just about helping the customer. And if you do that first, it's going to drive exponential returns. 

And I think... We thought about what's gonna actually be really good for the end customer because that ends up being really good for the store.

Chase Clymer  

Absolutely. Absolutely. Well, we touched on it briefly before, but is there anything else on the horizon that people should be looking out for with personalization and the integrations that you guys are offering?

Ben Parr  

I think... Look, think of like... We have a suite of products that work together and help each other, like our Messenger, and our SMS and our... 

Obviously, the Quiz being the key one. And they're helping you either collect this buyer profile data or leverage it. 

Everything we're doing moving forward is in those kinds of buckets whether it's products that we build to help deepen the personalization, or products that help you build this buyer profile database, or integrations that help you leverage this data on the other tools that you use... 

Klaviyo is just the beginning of a lot of other integrations that we have coming out in the near future. And so it's crazy because the quiz product has had  some kind of a crazy response. It's already our number one product. 

We almost tripled in size this year alone. Actually, in the last 6-7 months. And it's because the quiz has been... But clearly, people are looking for something like this.

Chase Clymer  

It's been needed in this marketplace [for] so long. And I guess I just want to [place a] caveat to all our listeners here, this isn't like a paid thing. I had been on because they're... 

This feature will help your business and they are pioneering it in this Shopify ecosystem. And it works. 

I played with the product. I know it works. I'm not out here trying to help recommend bad things or anything. It just works. It's one of those things. 

And if you've got a customer, existing customer base, or you're trying to grow your email opt-ins, or there are questions your customers always have, this is a great plug and play opportunity to help your store out. 

But it's one of those things. At the end of the day, it's just a tool. You gotta go into it with a strategy. You got to have a plan. So it might mean that you need to have some people help you out.

Ben Parr  

Yeah, it's exactly that. It's just as simple as "Go and do it. And then get results." If there's no results, then don't do it. But it's one of those things where the results are super clear. 

That's a nice thing. But the overall is anything that's going to help your end customer is going to be a win for you. And the more [it] can be personally branded, the better. And I don't know. 

All I know is Matt and I... My co-founder/CEO Matt and I made this like that on the Shop Quiz. [It was at the] end of 2019 when we decided to start building this thing. 

And we spent 6+ months engineering and [doing] things to build it. And it's crazy to see. We were... I almost hesitate to see it [working] right. 

But it was something that there was real demand for and I think I underestimated the demand.

Chase Clymer  

Yeah. It definitely played a key part in a lot of people's Black Friday/Cyber Monday campaigns and it's going to help people grow their businesses moving into 2021. 

Yeah, I'm excited for it. I'm excited for you guys. I believe I met you like 4 or 5 years ago at Unite. So it's been great to watch your guys's business grow in this ecosystem. 

Man, I miss Unite.

Ben Parr  

Oh my goodness! That was like... I remember our first Unite. And we were like... We had just launched our Shopify integration and we were just like... 

It was the first time we ever met Klaviyo. It was the first time we ever met any agencies. And we were just like these babes in the woods being like "What's going on? There's all this stuff happening." 

And I look forward to when there is an actual in-person Unite. I hope next [time]... I hope in 2021... Maybe it's not till 2022 to be honest. It's such a different thing now. 

I'm talking with the next generation of agencies and apps. And there's so many cool things happening in the ecosystem. It's just so cool.

Chase Clymer  

Yeah. I talk about it on this podcast all the time, especially when I'm talking to other apps and like other agency owners. This ecosystem is so much fun. Ecommerce is just a fun place to be in. 

And there's no silver lining to the situation that we endured this year with the pandemic. But the adoption of Ecommerce and it just thrusting forward so much market penetration of things going to Ecommerce only just made our industry explode. 

There's so much cool stuff happening. So many more smart people are now in the space. And it's fun.

Ben Parr  

Yeah. It's tons of fun. I'm excited. Yeah. Oh my god. The ecosystem... It's crazy just how much bigger the ecosystem is in 2 years time alone. And then how much bigger is it going to be in the next 2 years? Ecommerce is booming. I'm looking forward to when everything [is]... 

Like there's retail [again] and we can have those elements. And I think there's some cool things we can even do there. 

But I'm just excited by the ecosystem and the super awesome entrepreneurs and all the growth that I've seen this year despite really hard times. And a lot of people are fighting to overcome it.

Chase Clymer  

Absolutely. So you mentioned before how people get a hold of you. But just one more time. If people are curious about the product or they want to ask you a question, what's the best way to reach out and get a hold of everybody?

Ben Parr  

Yeah. So @octaneai on every social network and octaneai.com. So you can just go there, request a demo or just go straight up and download our Shopify app. You want to just go and get started. 

And then I'm just @benparr. And I will say my DMS are open on Twitter. So feel free to send me a DM. 

But I'm at @benparr on literally every single social network you can think of.

Chase Clymer  

Absolutely. Is there anything I forgot to ask you today that you want to leave with our audience?

Ben Parr  

No. Personalization, I feel like, is the key to a long term sustainable future for commerce in general. And building a better more personalized experience for every customer is going to be the default in the next couple of years. 

And so the number one thing to be doing now is to be collecting the data to actually do the personalization. That's why you want to be launching your quiz now. And you want to be collecting this data so that you can leverage it for the future. 

Because your competition, other stores, they're starting to do this now. They're starting to collect this data. And everyday they're collecting that data, they're gaining an advantage. 

Chase Clymer  

Absolutely. I couldn't have said it better myself. Ben, thank you so much for coming on.

Ben Parr  

Thank you for having me.

Chase Clymer  

I cannot thank our guests enough for coming on the show and sharing their journey and knowledge with us today. We've got a lot to think about and potentially add to our businesses. Links and more information will be available in the show notes as well. 

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