WORKWEEK

Happy Sunday!

I hope the team of your choice won Friday’s NBA Finals game (LETS GO WARRIORS!), you got some good time to relax this weekend, and you’re ready to dive into something that’s becoming more talked about amongst those who have been running growth marketing at DTC brands for the last 5-6 years – the death of the single channel strategy.

But, before we get into that, I would love to ask for a favor… if you have enjoyed the newsletter content that takes me 3-5 hours per week to put together, please share your referral link below with at least one person who might find it interesting.

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When I think about the 2017 world of eCommerce and DTC, this was when things were really starting to get spicy. There were tons of brands that had done a great job of arbitraging the ad inventory that no one capitalized on – Dirty Lemon, Native, Dollar Shave Club, Casper, Roman, etc. These brands all did one thing very well: they pioneered new spaces of advertising where there was consumer interest, and it worked well, because they were also the first movers.

Dirty Lemon drove so much revenue through influencer marketing. Native crushed Facebook early. Dollar Shave Club did the same and they also did really well with content recommendation widget ads. Casper did those plus subway ads. Roman did all of those on top of sponsoring sporting events. They were all first movers in new places, and it kept pushing the industry forward. Fast-forward to today, there is no shortage of places to spend your advertising dollars:

• Paid social (Facebook, Instagram, Snap, TikTok, Pinterest, Quora, Reddit, etc)
• Paid search (Google, Bing, Yahoo)
• Programmatic display (ad networks, direct buys with publishers)
• TV
• Audio (podcasts, radio, etc)
• Out of home (billboards, trucks, venues, banners hanging behind planes, etc)
• Creators/influencers
• Newspaper/print
• The list goes on and on…

In 2017, when we were getting ready to run a website promotion, the playbook was simple:

1. Clean up and upload fresh customer lists into Facebook audience manager
2. Get a set of creatives together that directly ties back to the upcoming promotion (i.e. Father’s Day ad creative)
3. Load up a campaign focused on remarketing and website retargeting (site engagers, post/page engagers, customer lists – emails and pixel, and maybe a 1% LAL, too).
4. Set a budget and hit publish.

With this playbook, for a high consumption brand, you could almost guarantee purchases come in at just a few dollars each and it was always an ROI-positive play. When running this today, the CPO (cost per order) as its told by the platform, without any attribution analysis, comes to roughly the same CPO for a new customer being acquired. That’s nuts.

This is just one example of a single-channel marketing campaign, leveraging Facebook. Today, these types of campaigns don’t work like they used to. Where I think we are going requires a much higher level of touch between the brand and the consumer. It can’t just be reliant on “brand” or “performance”… or just “ads” or “email”; it has to be a combination of all the things. You NEED to do 14 out of 14 things at a 120% level — there’s no room for anything less, anymore.

Here is what sits inside our evolving playbook of tactics for our internal brands:

Website

• The homepage MUST be hyper-optimized for mobile and speak to someone who’s never heard of the brand.
• The collections page must be optimized in the same way the homepage is, but merchandise products based on a new customer entry – bundles, best-sellers, award-winning products at the top. Landing-page-style flow on the page, to educate people who arrive at a collections page from earned media links.
• The product page must be optimized for someone clicking into the PDP from an Instagram product tag or Google Shopping – you might think the PDP is a lower-funnel page, but it’s not anymore. The PDP should be a landing page, too.
• Use landing pages (make some with HOOX!) that speak to people at different stages of the funnel (intent) and speak to the channel they come from. Someone coming from Google who’s familiar with your brand should be addressed differently than someone who’s coming from TikTok and has never seen your brand before.

Content

• The best “content” is stuff that either gets screenshotted and texted to a friend, or is something that gets brought up at the dinner table. Make that type of content as a brand.
  • The fun, cute, on-brand stuff, isn’t it. Create stuff that people wanna share.
• I’m also surprised more brands don’t treat their email list like a newsletter with interesting, innovative and informative content. Aspire to educate with SMS, email, video-view campaigns on FB/IG, etc.
  • We see this with TikTok — the stuff that “pops” on TikTok IS the content that educates, informs, and inspires.
• Think about why you agreed to work on your brand, as a founder of an employee, now synthesize that into content that gets others motivated to feel the same way about your brand.

Mobile App

• Not everything needs to live on the website. If you’re able to put together a mobile app with Tapcart, as an example, then do it.
  • You get an opportunity to include exclusive content, gamify drops earlier than when they hit your site, you get the ability to send push notifications which are fun/exciting.
• Mobile apps are for your super consumers — curate an experience that feels like they’re a part of Club 33 by Disney.

Ads

• Ads that work today are less about pushing the brand with graphics and short quick-cut videos, and more about teaching someone why they’re missing out by not being a consumer.
• The brands that can focus on pretty ads are brands that have been around for decades and spend millions in customer education in other ways — think of Kate Spade, Apple, etc. Don’t take a simple graphic from a brand like that as a sign that it will work for you.
  • We recently launched a big beauty brand and while there was a celebrity behind it, just pushing the celebrity + the fact that a new brand launched with her, clearly wasn’t enough to get people as customers.
• Run ads in innovative ways when you can.
  • Programmatic TV can be a UGC compilation, it doesn’t NEED to be a perfectly shot $100k piece of creative.
  • Out of home can be done on the side of trucks, and then you can retarget those customers with ads on Instagram, based on the mobile device IDs that the truck picked up.
    • This is the thought that was the inspiration for today’s email of single-channel advertising being dead.
  • Go to YouTube, where people spend 1,000,000,000 hours consuming content PER DAY, and work with creators who already have these eyeballs.
  • Work with creators who are already customers of yours, and create exciting content — sometimes the best ads aren’t created by the brand.
  • For this to work well, you also can’t dictate the creative — just ask them to recreate content of why they like the product. They are creators, let them create.

Membership

• Subscribe and save is dead. Even just things like early access to new flavors or sales isn’t that exciting.
• A subscription to your brand is a commitment from someone to your brand. It’s important to replicate that, to keep the LTV high.
  • This can be by partnering with other brands to send samples to your subscribers (Pill Club did this best).
    • The COGS of someone’s sample being given to your subscriber for free can be their acquisition cost.
    • For example, if you’re Hint water, when someone subscribes to 3 cases, make a deal with Uber Eats or Spotify to give them 3 months of a free premium membership. To Uber or Spotify, the bottom-line costs are close to nothing, BUT that few dollars becomes their acquisition cost of a new customer. You can do this with other consumer brands too.
  • Create events/gatherings for people to show up — just like if someone had a Soho House membership.
  • If you have friends that are founders with similar customers, figure out what you can do for each other’s subscribers that benefits both.
• A good membership program is all about creating an experience for the subscriber, more so than just a discount.

Community

• The easiest way I’ve seen this be done is by building a Facebook group for your customers. Your customers are probably quite likely to become friendly with each other as they’re all solving a similar problem being a consumer of your brand, and they probably have a lot in common.
• Meetups, dinners, paid-for workouts and more can all be a part of it. Think about if you were getting a group of all your friends together, even if they don’t know each other, what could you do that’s fun?
• Your “KPI” here with building community should be — “How can I get my customers to become friends with each other?”

Product Launches

• The best way to not only keep your existing customers engaged, but also acquire new customers, is by launching new products. New flavors, new scents, new colors, etc. You might be one scent or one color away from unlocking an entire new audience of customers.
• Obvi’s CEO did an incredible presentation (linked here) where he talked through the process of launching new SKUs often, and while they thought it was going to work against them, having so many SKUs, it actually benefited them heavily.

The goal is that between all of these 7 buckets, you’re consistently staying top of mind with customers, mainly through content, and you’re running less promotions than you need to. Fundamentally, promotions are either ran for three reasons, all of which could be substituted for different tactics. Let me explain:

• Cash Grab
  • Ok, you might need cash. If you can, launch something new on top, instead. High margin, and an extension of your product. If you’re selling powders, it’s a shaker bottle. If you’re selling alcohol, maybe it’s a cocktail making kit to accompany the bottle.
• Liquidate Inventory
  • Fair – we all need to get rid of some inventory sometimes. Try to keep the messaging away from a sale/promotion, but instead something where “Spend $40 and we’ll throw in X” like a gift with purchase.
    • You’re still pushing for a high AOV or UPT (units per transaction) and then you can use the margin to pay for the GWP (gift with purchase) or the inventory that you need to get rid of.
• Calendar-aligned (black friday) – fine, fair for the top holidays
  • This is hard to get away from for the big holidays (Black Friday, Christmas, Valentine’s Day, etc), but don’t run promos on every Hallmark Holiday.
• Keep customers engaged/excited
  • Sometimes you want to run promotions just to keep customers engaged. I would challenge you to focus on creating content that keeps them engaged, instead.

The short-term downside is that you will need to invest more into the 7 things listed above, but the upside is that with the costs of supply chain, freight, customer acquisition and, literally, everything else, rising, you’ll be in a better position to continue building the business.

I think we’re done with the days of scaling acquisition dollars without scaling everything else. I remember putting together a flywheel a couple years ago where it displayed that for every dollar invested in customer acquisition, you should also distribution some equivalent of that dollar (depending on the level of spend) into resources, supply chain, technology and more people. It’s now becoming truer than ever.

Speaking of supply chain, if you use Cogsy and they can’t improve your ops by Black Friday, they will refund EVERYTHING you paid them. It’s a 0-risk shot to try the product that helps so many big DTC brands stay on top of their supply chain. Try it here

Are you seeing similar things on your end? Please reply and let me know!

Alright, on to some fun stuff…

Vendor of the Week:

Route — The must-have package tracking, insurance and carbon-offset app for your website.

If you already haven’t heard of Route, it’s a simple app to install, for free, and allows your customers to add package insurance to their order, as well as order tracking and carbon-offsetting.

They are going to be hosting Route Connect, hosted by Nick Axelrod-Welk (founder of Necessaire and Homecourt), with speakers from brands like POOSH, Ruby, Cotopaxi, Fly By Jing and Supreme. I spoke at the event last year and this year’s event is completely free to my newsletter subscribers! You can sign up here and get a ticket. It’ll be available virtually and also in-person in New York City on June 30th!

Register using this link to join Route Connect 2022 for free!

Jobs of the Week:

• Arber — Influencer Marketing Coordinator
• Homestead Brands — Marketing Director
• Wild One — Strategy and Planning Associate

If you’re on the other side of the fence and need a marketer, I highly recommend you use MarketerHire for a highly-skilled and vetted marketer.

Question of the Week:

What is your most used app on your phone?

I’ve been diving into BeReal lately, which seems to be growing quickly. I have like 6 friends (add me — mrsharma) but it’s such a fun way to interact with people.

Brand of the Week:

Obvi — The nutricosmetics brand that stays innovating

I linked the CEO’s keynote from GeekOut above, but Obvi is such a fun brand to watch grow. They focus on the intersection of people feeling good and looking good, and nutrition. Their brand stays an inspiration for me to constantly watch from what they do with their customers, their FB group, their landing page updates, and more.

The products are also super tasty, and taste like dessert! Try it out here.