CMO50 2022 #9: Ryan Gracie

  • Name Ryan Gracie
  • Title Chief marketing officer
  • Company MyDeal
  • Commenced role May 2021
  • Reporting Line Chief executive officer
  • Member of the Executive Team Yes
  • Marketing Function 28 staff
  • Industry Sector Retail
  • 2020 ranking 23
  • Related

    Brand Post

    When it comes to realising brave work and engaged commitment across the marketing function, it pays to think about all the moving parts, says MyDeal’s Ryan Gracie.

    “I work with a team of experts and am the composer and conductor of the orchestra,” he says. “Each of the individuals knows their instruments better than I do, and I make them very aware of this. I empower them to play, but to play along with the rest of the team and from the same song sheet towards the same goal. It’s my job to compose the strategy then consider every channel and how to optimise them all for the best outcome, to keep the team in sync, to let them grow and to guide them.

    “But it’s also the team's job to be brave and to take chances. I constantly encourage them to use their expert knowledge to make the tune we play the best it can be.”

    It’s this mentality Gracie brought to the CMO’s post at MyDeal following a successful stint as the marketing chief of online retailer, Catch Group. During his time with Catch, he not only built out a team that exceeded 100 people and commanded a $62m budget, he was also a key executive leading the company’s $230m sale to Coles Group. His work helped take Catch’s revenues to over $1bn and record growth of 130 per cent year-on-year.

    And he’s doing it all over again at MyDeal. In May 2022, Woolworths acquired an 80.2 per cent all-cash consideration of MyDeal at $1.05 per share, a 62.8 per cent premium to the closing price prior to the announcement, valuing the company at $270m.

    “It places me in a very unique position, having been the CMO at the helm of the two largest ecommerce acquisitions in Australian history,” Gracie comments.

    Innovative marketing

    Having built Catch Group’s sophisticated lifecycle marketing across digital channels and its first above-the-line brand efforts, Gracie was assigned a similar task to make MyDeal famous. The remit required a full overhaul of the brand from top to bottom.

    “The first task was to recreate the look and feel, create a new logo, a new brand tone of voice and an entirely new personality that reflected our value proposition of pure shopping joy,” he explains. “The brief was to build a distinctive, engaging and recognisable brand.”

    72 & Sunny was appointed and created what became a highly distinctive and effective campaign featuring a reworked version of Devo’s cult 1980s classic, Whip It. The campaign took MyDeal above the line for the first time across TV, radio, outdoor and all digital channels with a multi-million-dollar investment that brought the brand to an entirely new audience. This contributed to an 18 per cent sales increase over the first three months - in a non-lockdown period when most online retailers were trailing elevated year-on-year sales figures.

    “The entire business took on a new persona that elevated it on all levels,” Gracie says. “Conversion rates were up 34 per cent, average order value by 26 per cent, and marketing efficiency and sales all benefited. The rebranding has been a major success and will continue to rollout.”

    Business smarts

    A key element of the brand overhaul was how the business saw itself. “Prior to my arrival at MyDeal, the business had recently repositioned the proposition to be centred around ’Everything for the Home’, taking on the likes of Temple & Webster, Ikea, Fantastic Furniture, and other home and furniture retailers that specialise in big and bulky products,” Gracie says.

    “Big and bulky is very hard, expensive and labour intensive. We don’t have our own warehousing facilities, we use a 3PL. Selling furniture online is difficult, the conversion rate is relatively low and customer acquisition costs are high. Being confined to category lanes is sales restrictive. Merchandising furniture, which is largely fashion and trend-based, is inefficient.”

    But for Gracie, the biggest reason of all to not play to this positioning was that MyDeal’s actual customer proposition wasn’t being fulfilled. “Our name says it all: We are MyDeal,” he says. “We are the place where people go for a deal on anything, ‘Need it, Want it, MyDeal it!’.”

    Tapping into his stakeholder management skills, Gracie convinced the CEO and executive team to open up the proposition from ‘home’ to ‘home and lifestyle’. “That word ‘lifestyle’ allowed us to source and market products from almost every category. Our world expanded exponentially,” he says. “We were able to play to our strengths, to increase the purchasing occasions.”

    The result was a 17.6 per cent increase in active customer numbers and hefty conversion rate growth. Repeat transactions also went up from 1.7x to 2.1x. “Importantly, we were able to craft a distinctive personality around the joy of shopping,” Gracie says.

    Customer-led thinking

    This shift also required the team to showcase this new category format and approach to customers. “We needed to innovate, to surprise and delight our customers constantly,” Gracie says.

    “We embarked on a more ‘sales event’ led strategy that allowed us to communicate value to our customers more frequently, driving impulse purchases and capturing more of the intent. In order to manifest this strategy, we needed to build and flex our merchandising muscle, a muscle that had not been formed.”

    A team of four with MyDeal’s new merchandise lead worked with marketing to rework the website to accommodate the new format, applying a new style guide and launching a minimum of 10 new ‘sales events’ per day across channels including email, push notification and social.

    “This was a complete paradigm shift for the business, which grew customer engagement levels and contributed to a 31.3 per cent increase in conversion rate,” Gracie says. “By building this merchandising format, we have also been able to build a highly profitable part of the business: Retail media sales. We have developed a small team dedicated to work with our 1300 marketplace sellers and first-party suppliers to build promotional campaigns that drive revenue and deliver advertising income to the business. This is definitely a huge income opportunity.”

    More broadly, as CMO and evangelist of customer obsession throughout every facet of the business, Gracie has championed focus on the customer service function, making exceptional customer service a differentiating factor of MyDeal. Prior to his appointment, the company had not used Net Promoter Score (NPS).

    “I built out this customer obsessed discipline throughout all teams, taking our first NPS measure of 39.3 to the current score of 53.6, delivered through a focus on optimising every customer interaction and touchpoint,” he says.

    Data-driven maturity

    The building hasn’t stopped there. Gracie has also been quick to ramp up the data function and a data-led strategy. The first step was orchestrating data to a RFM (recency, frequency, monetary) customer model, forming eight cohorts ranging from new to potential loyalist, at risk and champions. These are now utilised from onboarding to retention, win back and reactivation.

    Gracie says the marketplace is well on its way to achieving one-to-one personalisation with customers, is timing and automating relevant cross-channel messages and incentives for greater effect, engaging in channel shifting to ensure customers interact with communications on the most appropriate channel. In addition, it’s growing its percentage of ‘champions’ and increasing lifetime value, while reducing the cost per acquisition. Active customer numbers are now over 1 million, up 17.6 per cent year-on-year, and repeat orders from active customers have hit an all-time high of 64.6 per cent.

    MyDeal’s app, launched in May 2021, has been a major beneficiary of this data strategy, growing to be the number one home and lifestyle app in the iOS store with 611,000 instals, representing 20.3 per cent of all sales.

    Commercial acumen

    It’s clear through all of this just how commercially focused a CMO Gracie is. In FY22, his first full year of tenure as MyDeal CMO, gross sales grew 24.8 per cent to $272.2m, driven by growth in the active customer base of 17.6 per cent. At the same time, marketing as a percentage of overall gross sales dropped 2.5 per cent while delivering significant top-line and bottom-line growth.

    “The most pertinent evidence of a positive commercial outcome is that the culmination of all the great work the team has performed, put MyDeal on the map and drew the attention of Australia’s largest retailer, Woolworths Group,” Gracie says.

    “Preliminary discussions with WOW CEO, Brad Banducci, eventually led to the acquisition of MyDeal, an 80.2 per cent all-cash consideration at $1.05 per share, of $271m valuation.”

    Leadership impact  

    As the marketing team has grown significantly, Gracie has focused heavily to carefully manage the culture from startup to scaleup.

    “Maintaining the DNA, passion and energy and making sure old and new employees mesh into a cohesive team was vital to the overall success of the marketing function and the business. I, with other senior management, successfully led the business through this stage of growth and kept attrition very low,” Gracie says. “Our productivity is high, and we have a very engaged team that despite enjoying flexible work arrangements comes into the office at least four days a week because they love it.”

    In order to build a high-performance culture, Gracie has a set of guiding principles for the measurement of key metrics and therefore management of key outcomes. These include a focus on continuous improvements of the controllable inputs and outputs that customers’ care most about.

    “Our input and output metrics are a way of mapping the operating model and value delivery system as a set of metrics. They will become wired into our consciousness, allowing us to better serve our customers and generate long-term free cash flow,” Gracie says.

    Equally, patterns and insights in data can accelerate decision making and improve leaders’ judgement. To get there, creating and using metrics is a collective leadership journey, not a one-off specialised task to answer a specific question, Gracie says.

    “Aligning not only the marketing team’s objectives, but the entire business’ objectives around common goals has enabled true scale and growth. Without the OKRs, we are a ship without a rudder,” he says. “It has also been very important as a team to rally around more than just metrics and selling stuff. We must build a culture that feels truly part of something more than that.”

    As an example of building a higher sense of purpose for staff and a commitment to actionable sustainability, Gracie introduced MyDeal forest, a commitment formed with GreenFleet to plant a native biodiverse forest near Wedderburn in central Victoria.

    “Although it’s small in the scheme of things, it’s the right thing to do and gives our team an added sense of purpose,” Gracie adds.

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