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Transcript83 lines
- [00:00]
Brian Morrissey
Foreign.
- [00:13]
Katie McAdams
Welcome to Ad Exchanger Talks, the podcast
- [00:15]
Alexa Raffaele
devoted to examining the issues and trends in advertising and marketing technology that matter most to you.
- [00:23]
Sarah Sluice
This episode is sponsored by Basis, the leading intelligent operating system for autonomous advertising. Its enterprise AI solution transforms campaign briefs into strategies and media plans that integrate directly into omnichannel activation.
- [00:50]
Brian Morrissey
I'm Allison Schiff. You're listening to Ad Exchanger Talks and my guest this week is Alexa Raffle, CMO of goop, the wellness and lifestyle brand co founded and led by Gwyneth Paltrow. Alexa is also the former SVP of Digital at Rhodeskin Hailey Bieber's beauty brand that sold to Elf Beauty for a billion dollars. We'll talk about what it takes to market celebrity founded brands without letting the celebrity completely define them how Alexa balances brand and performance using metrics like LTV to CAC and Total Business roas and how GOOP is leaning into AI and automation in paid, social and creative, but with guardrails. That's all coming up, but first, make sure to save the date for programmatic I.O. new York. It's a hot ticket prog I.O. is taking place on September 28th and 29th at the New York Marriott Marquee and we'll bring together all the people you want and need to hear from to explore trends in AI driven media decisioning, retail media and commerce signals. If you care about the open web, you'll be there. Hey Alexa, welcome to the podcast.
- [01:56]
Alexa Raffaele
Hi. Thank you for having me.
- [01:59]
Brian Morrissey
So what is one thing about you that not a lot of other people already know about you?
- [02:06]
Alexa Raffaele
So I have been to 44 out of 50 states and I feel like that's a good one. I feel like not most people have been to even half. So I'm very lucky that I've A lot of it has been in the way of driving or just stopping for, you know, gas or all of that. But yeah, 44 out of 50 states is my claim to fame that most people, it counts.
- [02:28]
Sarah Sluice
Yeah.
- [02:29]
Brian Morrissey
Well, what states are you missing?
- [02:31]
Alexa Raffaele
I'm missing Alaska. I'm missing Mississippi and Alabama. I'm missing North Dakota, Maine. There's one other in the south, Kansas.
- [02:45]
Brian Morrissey
Tennessee. I will say I've been to Tennessee, but I don't think I've been to any of the others that you mentioned and I have not been to even a close amount of ones that you've been to. Yeah, that is a good one. I also can't really spell Mississippi, so that's a challenge.
- [03:02]
Alexa Raffaele
That one's ingrained in my head. M I S S I S S I P P I from school, something. It's in there for a book.
- [03:11]
Brian Morrissey
Well, I want to do a little career rewind. So before goop, and we're going to spend a lot of time talking about your role at goop, but you were the SVP of digital at Rhode Skin, which is Hailey Bieber's brand and it's since sold to Elf Beauty for a billion dollars. So GOOP very associated with Gwyneth Paltrow, of course. So these are two celebrity founded lifestyle brands. But it feels like the marketing challenges were different because Rode is a very like hype driven, extremely Internet native brand. It basically lives on TikTok and Goop is a publisher and a retailer and a health and wellness brand, like in its own right. And it has its own particular like cult energy and a much longer history and its own set of, I mean, complicated public perceptions to navigate. So what would you say are the opportunities, but also the challenges of marketing a brand with a famous founder at the center of it? And what was the difference, what is the difference between your time at Rode and what you're doing now at GOOP as cmo?
- [04:20]
Alexa Raffaele
Yeah, I mean it's just like Rode when I joined was barely a year old and GOOP I'm joining almost 20 years in. So that alone has been, you know, such a difference. And GOOP has had so many different lives, I feel like it's lived before me. But the part that I've come over and into and where the focuses are, GOOP have been similar in the sense of like GOOP Beauty is a younger brand on its own and is in a high growth stage. So that's been like a comparison I've drawn. But with road, it was so organically driven that my job there was to really come in and kind of flip the lights on as it related to like foundational acquisition, retention, e commerce practices because they had already built such a machine and an organic growth engine. With GOOP coming in there, a lot of those lights were on. It was more about the optimizations and all of that. And then Hayley and Gwyneth are so different as founders, but both of them deeply passionate about the products and what goes out there and also deeply passionate about marketing and creative and kind of know their lane and their strengths. Which is a compare, a comparison I've drawn between the two of them. And Gwyneth is a business operator, she's our CEO, she's my boss, I report to her. So that's also a difference. ROAD was more so this just like rocket ship that I was lucky to be a part of for a year. And it was very exciting. And GOOP has been more of a coming in and strengthening strengths. GOOP Beauty, the owned business lines, a turn and focus towards that. And then also like the GOOP ecosystem and what it looks like in this next iteration of curation and still being that destination for the people who have been with us for so long, but also opening up to new audiences, new customers. How are we serving this next generation of people?
- [06:12]
Brian Morrissey
Well, yes. So GOOP is having an interesting moment right now because while you're pushing toward full year profitability, there's been the expansion of beauty, which you referred to, but also into ulta stores, like 800 Ulta stores. There was the launch of a fashion line at New York Fashion Week and then there's Goop Kitchen, just expanded to New York. And it's generated some feedback. If you've been on the Internet recently, you've seen that just a lot of verticals running simultaneously. And then of course there are also the core businesses. So how do you hold all of that together and keep the marketing operation like clear and coherent when there are just so many like threads and tendrils?
- [06:54]
Alexa Raffaele
Yeah, I mean, it's all like it's under one umbrella in the sense of like we all ladder up to GOOP and to Gwyneth and the mission being in service of our customer, whether it's through food, through beauty, through fashion and all of that. But then obviously each of the business lines have their own, you know, customers to serve and unique needs. Like a beauty customer generally is so much different than a fashion customer. I dealt with that a lot in my work at Jenny Kane when we ended up launching a beauty brand. The crossover, very limited, the type of customer.
- [07:27]
Brian Morrissey
So different actually.
- [07:29]
Alexa Raffaele
So, yeah, you know, we're monitoring customer health by vertical, but also looking at the crossover and what that looks like. So it's just about like having the unified marketing front in the sense of like how these brands together are in service of GOOP and its mission and the customer. But then also the unique needs of each customer of the business line, the messaging. We have marketing ladders by what vertical we're talking about. But then also there's the editorial arm of the business, which is still a big audience driver and that's more the discovery, the curation, Gwyneth's point of view, what we're, you know, checking in on the cutting edge of wellness and all of that. So it's all of those things ladder up into this Larger group, Gwyneth ecosystem, where at the core is. It's this pioneering spirit which we see in our beauty products with the ingredients. We just launched an NAD cream in January, which is kind of first to market of its kind. And then on fashion, it's the expression of woman and self and, you know, unique details about the clothing that really embody Gwyneth and her spirit. And then same with our content and where we're on the cutting edge of wellness treatments. Editorial team trying out all these different things and they all ladder up into that spirit, but then have like more traditional marketing plans and customer, you know, cohort monitoring and all of that based on the vertical.
- [08:50]
Brian Morrissey
What is the difference between a fashion customer and a beauty customer? Because I don't know, just anyone watching on video can look at me. This is my uniform, black T shirt, and I never know what to do with my hair. And I'm not wearing any makeup other than chapstick, so I'm not necessarily your target. And in my mind they're super aligned and they almost fall into the same bucket. But you're saying that they don't. So what's the, what's the difference between how you reach those two different cohorts of people?
- [09:19]
Alexa Raffaele
Yeah, well, particularly like just in price point alone, like our average fashion item is upwards of, you know, 350, $400 on a, on like a sweater. And that's, that's the lower end. Whereas in beauty, we're definitely a luxury price point, but you can get in on, you know, a 35 cleanser or a 52 scalp scrub, like it's not unapproachable in price point in the way that fashion can be. So the beauty customer is typically a little bit lower spend but high frequency of purchase, whereas fashion, you know, someone might have that initial $800 AOV, but they're going to probably only buy once a quarter, versus a beauty customer who you get to subscribe, you know, month to month. Also, the beauty customer is way more discovery oriented. I feel like the, like super beauty consumers, especially with makeup, they always are wanting to try new products across all different brands. So there's also within beauty, the makeup customer versus the skin care customer, with the skin care customer typically being much more valuable because they'll get hooked on a product and want that consistency in their skincare routine. So even within the vertical, there's differences with like customers we've acquired on color versus customers we've acquired on skin, so they just behave differently. And then there is like the goop Customer, which is our own subset of people who've been with us since the inception of the brand who are buying across category and behave completely differently than those individual vertical customers.
- [10:49]
Brian Morrissey
How do they behave differently? What's their vibe?
- [10:52]
Alexa Raffaele
I mean they're very much like, put it in front of me and I'll buy it. Gwyneth is telling me to buy this. I want that lifestyle, I want that curation. And also like, it is like the goop lens, the rigor that we put on the multi beauty products we sell is best in class in terms of clean. What's the best thing to put on your skin? So people who've been with us have that intrinsic trust of like, if it's on the site, it's safe for me to play in that space. Space. And they're shopping cross category in a big way. It's, it's beauty, it's fashion, but it's also wellness. It's the home products that we carry that differ store to store, all of that.
- [11:29]
Brian Morrissey
Well, I do want to address the, the, like, the Gwyneth of it all, if I can put it like that. Because I mean the brand was built on her Persona, her taste, her credibility, like even the fact that she can be like polarizing. And I think most brands would kill for a founder with that kind of cultural reach. But it is a double edged sword. And she's been stacking, stepping back a little bit, public facing stuff because she wants the brand to really stand on its own and not be so associated with her. And that creates a genuinely hard like brand strategy question. Right? Like, can a brand built so explicitly around one person's point of view successfully transfer that to like an institution? So where are you in that process and how does marketing, because marketing must be a big part of that. What role does it play?
- [12:19]
Alexa Raffaele
Yeah, I'm not even sure she's stepping back in the sense of more so like focusing on where her presence matters and moves the needle. Like she still gets in the bathroom with her phone and is making, you know, get unready with me. She posts her outfit of the day, you know, Instagram stories. She still does boyfriend breakfast, which is a huge audience driver for us. And focusing her on where like she can be culturally relevant and be, you know, who she is and have her personality without like, you know, putting her in front of a camera and forcing her to perform on things that aren't authentic to her. So I think it's actually going back to what made GOOP so special in the beginning, which is her authenticity and Leveraging that over, just blasting her across every single campaign, which I feel like Rhoda is starting to do as well. Like, from the outside looking in, bring in new faces. It also allows for more relatability, but with her, like, personality and sense of humor and all of that still living throughout the different brand touch points, that makes sense.
- [13:23]
Brian Morrissey
And now, are you ready? I really want to nerd out a little bit because this is Ad Exchanger talks. So at Advertising Week in New York last year, you were on a panel and you were talking about anchoring your team to three metrics. So lifetime value to cac, total business return on ad spend, and then new customer roas. And I do really like this framing because it's trying to hold, like, two things together at once that a lot of marketing leaders treat as opposites of brand and performance. Obviously, both are incredibly important, but it also builds in some real accountability because those numbers don't really lie. Like, LTV connected to CAC is going to tell you if the customers you're acquiring are actually worth what you're spending to get them. And total business Roas keeps you honest about the whole thing. And then obviously, new customer Roas, that tells you if you're actually growing, which is incredibly important. So why or how did you develop this framework? And I guess your CFO loves it.
- [14:31]
Alexa Raffaele
Yeah, yeah. I mean, and they appreciate the transparency. Because I feel like in my past, like, there's been tension. Well, there's always tension between brand and performance, as we know. And that's kind of been my impetus as a cmo and everywhere I've been of, like, marrying those worlds at the jump, because I do not think one can exist well without the other. There was this analogy. It was like, brand without performance is the wallpaper, and performance without brand is just noise. Something like that. I'm probably messing it up. So that marriage is super important.
- [15:05]
Brian Morrissey
Get your drift?
- [15:06]
Alexa Raffaele
Yeah, yeah. That marriage is super important. But finance is key. Like, let's look at our ad spend at an order level by vertical and see where, you know, is our spend healthy. And I think people often are given these budget numbers and they're just like, okay, we have to spend, spend, spend. But I want to know, like, how that's working for the bottom line as well. That's important to me as someone grown up on the performance marketing side of things and finance being a part of the conversation. But more importantly, understanding marketing and the impact we can have on the business. So it's not just like marketing spending all those dollars again. So, yeah, that's definitely an important relationship to me. And those three numbers in particular I think show customer health on a couple of different levels and also like push on bridging functions in terms of like the acquisition function, the retention function, the E comm CRO function. Those three together are an acquisition engine because a lot of the customers that we're, the new traffic ads are sending to the site, we need to ensure we have a great retention flywheel to push them through that and ultimately convert them on a channel that retention owns, like email. So those just feel comprehensive to me and clean. Like there's just so much muddiness in attribution. I know everyone talks about this all the time. Of course we look at last click like to measure like benchmarks of year over year and things there. But it's not like the driving force in the same way like these metrics can be like it's just crystal clear. Everyone knows what they're working towards. Everyone has a health check on a couple different functions of our marketing spend and marrying brand.
- [16:44]
Brian Morrissey
And performance is so important because if you over index on one, eventually you'll realize like it'll show up in the numbers and you'll have to course correct. I was reading, I think it was in the Wall street journal recently about 1, 800 flowers and they were spending a ton on performance and they realized that they had to start investing more in the brand for all the reasons you were just talking about. And it was I think similar for manscaped. I had their CMO on this podcast and very, very D2C focused ton of money on performance and all the social channels and now their big thing is investing in brand. They even had a Super bowl commercial.
- [17:27]
Alexa Raffaele
Oh wow.
- [17:29]
Brian Morrissey
So they, they're going big.
- [17:31]
Alexa Raffaele
Yeah. No, seriously, that's awesome.
- [17:33]
Brian Morrissey
But attribution. So I, I didn't actually get to see your panel but I, I heard about it actually and there was something that you said on stage that I think is really interesting and I want to interrogate it. Interrogate it a little bit. No, no, because I agree with it actually. I just want to parse it a bit. But you said when a single channel claims that it's driving the majority of revenue on its own, then something is quote unquote being lost in translation. Which is really just a diplomatic way of saying that self reported attribution is mostly fiction or at least that's how I read it. So because attribution is so messed up, you just alluded to it. How do you get to a version of the truth that works, that backs out for you. And what kind of measurement infrastructure do you need for that? You know what you want to measure but like how do you measure it? Media mix modeling, incrementality, some kind of combination?
- [18:35]
Alexa Raffaele
Yeah, I mean a lot of it is just those holistic numbers, media efficiency ratio. Looking at that, you know, I've worked with the tech team on like a couple of different, like attribution modeling and all of that. But like it just never feels as clear cut as like looking at those high level metrics, the total spend. Obviously there's so many variables there but if they're all being accounted for, like including like creative spend and you know, the non working dollars let's say and looking at many different versions of it to have a couple of different health checks. But I think it's you know, our new customer cac, our blended cac, monitoring those over time, day to day. Our team's always looking at that and both of them and all of them, what's the beauty CAC versus the Gwin CAC and monitoring those on own. And then there's also, you know, other things available on our site like the multi brand and multifashion. How are we accounting for people who are coming through a group beauty ad but may end up shopping over there? So I think those holistic numbers are really good health checks. And then using the channel metrics for you know, ad specific performance or you know, paid search, all of that. Like paid search is a channel where I feel like over time has just become so beyond overstated and like someone at a high level on a different team will be like, oh my God, paid search is a 30x ROAS. Why aren't we spending there? And it's like no, that's a function of honestly the work we're doing on organic and paid media because then people are googling goop and just clicking on the first one because that's what's coming up and we're owning that. But yeah, all of that's to say is I think it is those high level business metrics and then parsing it out by vertical and looking at those verticals, those metrics across the different verticals, the whole company and you know, taking health checks from there and channel owners really owning those at the highest business level so that they can make decisions for those channels based on like a realistic picture.
- [20:30]
Brian Morrissey
What I think is interesting too about these metrics is that it's roas, but it's a specific kind of roas, different flavors of roas. So it's roas in a connected to new customers or, you know, roas connected to cac, that kind of a thing. And that's a trend. I think I wrote something recently about Albertsons the. Well, their media collective, the Retail Media Network, and they launched a metric they're calling incremental roas. So it's not just roas anymore, because roas can be quite misleading.
- [21:07]
Katie McAdams
It's.
- [21:08]
Brian Morrissey
It's kind of like atomized roas in a way.
- [21:12]
Alexa Raffaele
Yeah, no, it's, it's it and it. And it illuminates so much like we are spending the bulk of our meta dollars on new audiences. So it wouldn't make sense to look at, like, total roas there. But new customer roas gives us a picture. And while sure, there might absolutely be some of those dollars driving some repeat customers, if that looks healthy at a high level, we know we're putting those dollars in the right place and et cetera.
- [21:38]
Brian Morrissey
All right, well, there's going to be more et cetera, because we're going to take a quick break now, but when we're back, I'd love to talk a little bit more about the platforms and measurement, but also how you approach using AI. And I know you had an interesting partnership with this performance marketing platform called Adora that we covered actually in Ad Exchanger. So, yeah, stick with us.
- [22:17]
Sarah Sluice
I'm Sarah Sluice, editorial director at Ad Exchanger, and I'm with Katie McAdams, the chief marketing and commercial officer at Basis. Welcome, Katie.
- [22:26]
Katie McAdams
Thanks for having me.
- [22:28]
Sarah Sluice
So Basis has found that media teams today are juggling an average of 9 different platforms Platforms to run a standard digital campaign. Which makes my head spin because I know when I like switch browser tabs or switch products, I'm like, wait, what was I here for again? So how does this impact their ability to be successful as an advertiser? Sure.
- [22:50]
Katie McAdams
So it's a great question. What we find in our research is that our industry is losing anywhere from 80 to $100 billion annually in value leakage from errors, inefficiency and siloed campaigns sitting in all of those different platforms that you're talking about. And advertising is just becoming more and more fragmented, whether it's across teams, channels, tools, finance systems, and now different AI solutions. So that's a lot of context switching for one team in one day.
- [23:18]
Sarah Sluice
Wow. So what would a connected advertising system look like as an alternative to those nine platforms?
- [23:25]
Katie McAdams
What we find in talking to agencies and brands is that that journey really needs to start with consolidation. And by consolidation, I mean getting all of your media contracts, your campaign plans, your invoices, and your client communications into one place so that you have a single source of truth. And once you have that foundation in place, then something important really starts to happen. You actually have data that is clean and reliable so that your AI can function with it more meaningfully and more predictably. So the brands and agencies that get to this state fastest are not going to be the ones who are bolting on the most AI tools. They're going to be the ones who are able to build that operational foundation first.
- [24:03]
Sarah Sluice
I like this point that centralization isn't just about me as the media planner, but also about having more unified data that will then help me with AI, which I'm glad you brought up AI. So tell us a little bit more about how AI is being added onto this connected advertising system.
- [24:22]
Katie McAdams
Sure. So this is where having that solid foundation in place is going to actually help AI become more of a multiplier for your organization and your teams. As an example, Basis has Compass, which is our agentic AI planning tool. It lives right inside our platform and it solves the problem of media teams spending hours and even sometimes days synthesizing media briefs, building frameworks, building media plans, and then creating client ready presentations before a campaign even launches. So Compass actually takes that brief and generates a complete omnichannel strategy across programmatic, search, social and direct in minutes instead of weeks. That strategy then becomes connected and pushed into their media plan, which can then be activated on through the BASIS platform across programmatic, search, social and direct media buys. And what we find is that agencies and brands who are using Basis overall are seeing 30 to 40% operational efficiency gains when they operationalize all of those workflows into one place. And that really creates an expansion of capabilities with teams being able to gain back time to focus on strategy, creativity and growth.
- [25:29]
Sarah Sluice
So we have more efficiency through centralization, which then enables more use of AI, which is even more efficient. So, really interesting to talk to you, Katie, and thank you to Basis for supporting our podcast.
- [25:42]
Katie McAdams
Thank you.
- [25:58]
Brian Morrissey
All right, we're back and I'd like to talk a little bit about AI and paid social. So paid social is a very. It's a very different animal than it was like three or even two years ago because the platforms have gotten much more aggressive about pushing automation, AI powered targeting and dynamic creative and AI generated creative. And for a lot of brands there is a trade off there, there's efficiency, but then you also have to give up control. And for a brand with a strong Brand, you know, like Goop, I would imagine you don't really want to give up control, but then again, you know, there's the. The delicious cocktail of, you know, efficiency and lower costs. So. Yeah, but we're in this world where the algorithm decides, like, what you see, and then you might lose some ability to be specific about how your brand shows up. So how do you navigate that tension? And what do you let the platform optimize for you? And where. Where would you insist that you still have to hold the wheel?
- [27:11]
Alexa Raffaele
I think. Are you talking about Adora specifically or Meta generally?
- [27:15]
Brian Morrissey
No, more so Meta. We can talk about Adora in a bit, but more the big dud dudes.
- [27:21]
Alexa Raffaele
Yeah, I think we still, you know, I still feel like creative is like, they'll say so many. I don't know, they change their tune every week, but I feel like there was a period where they're like, creative differentiation doesn't matter. It's number of assets or it's number of assets, and they all just need to be slightly varianced. And what I've kind of stayed true across every brand I've been at is creative that's authentic to brand, but also, like, what are we. What, like, problem are we solving in our ad Creative, like, that's kind of the very baseline of performance marketing, acquisition marketing for a brand like Goop, particularly Goop Beauty, which is where we're investing most of our paid dollars, is where we're going to win. So, you know, we have so many different lines of creative from Influencer to Gwyneth led to, you know, just stills to viscerals. It's kind of all over the map and we go, you know, where the wind blows. In the sense of within those content frameworks that we've set up, we're going to put the dollars where they're working and feel comfortable about the creative because it's already passed through a couple of different brand lenses, fonts. Like, even if it says, like, this is the only serum you need, where it's like a pretty broad claim and like, the brand team probably wouldn't want to put that on, like the top of our Tuesday newsletter, it looks nice, the product is really amazing and does work and could be the only serum you need, so we'll go with it. So, like, there's just kind of like a handshake that we have that the guardrails we've set within our team with our agency, that will play within those. And, you know, if we do have something that gets flagged by creative, we're respectful, we take it down. But also if it is the top performing ad, we're going to talk about it. So it is just like having that handshake agreement for the performance team to play within that space with creative and letting Meta do its thing while having that mutual respect.
- [29:23]
Brian Morrissey
Well, you brought up Adora and I did too. So before we talk about what it is and how you're working with them, how does a vendor get in the door with a well known brand? I'm assuming you're getting pitched constantly by companies that just want to get airtime with you. And I don't know if you do this, but I've seen people who work at well known companies, when they attend advertising conferences, they turn their badge around because otherwise they'd just be bombarded. Yeah, because it's just self preservation. So what pitch actually works? How does a vendor get in front of you with something that convinces you that you want to try them and maybe work with them?
- [30:08]
Alexa Raffaele
Well, this vendor definitely had an edge and that was a Gwyneth intro. So of course I'm going to entertain even a call. So that's kind of. Sorry guys, that's the, that's the ticket. But yeah, so she, she put this in, in front of us, you know, through someone in her network. She knows one of the founders really well, who's amazing. Kabir. He ran the panel that I was, that I was on, that you were referencing. And I got introduced to Marco, who's their CEO. And this was like almost a year ago. So I want to say it was August last year and I was skeptical. I was like, there is no way I'm going to convince my creative team that this is something we should even try, let alone, you know, I don't know. I just, I also had my doubts just at that point. The landscape with AI has changed so much, obviously today, like I, I look at myself there and I'm like, wow, you were so close minded. But we looked at it. I was really charmed by Marco and their pitch and like what it could do. And more importantly, like it wasn't just like this random AI image generation tool that like you could log on. It was, it really had the like integration to meta and the performance aspect of it, like right, right there for us. Which I felt like Meta Ads Manager is a mess. Everyone knows that. Like the insights and what we were able to access with their platform, that was juicy enough for me to be like, okay, let's do some trial and error here. So we did kind of like a Test run with them for a couple of months. And the biggest thing that was proven to me and also to my team is how additive it was. Because one of the challenges I've had at every brand is having enough assets to feed the meta beast. And this ingests our existing assets and can iterate on it in the sense of like swipes of the peptide serum. Like we get like four of those from a shoot because that's just like what they have the bandwidth for. But being able to feed that in and get it in a couple of different, more contexts to keep refreshing that same still with the top performing copy over and over again has been game changing and has also taken creative pressure off of our team. Also what it's able to do in the way of like low level graphic design has freed up a lot of our resources to sometimes not even have to touch ads because it has our fonts. We're able to do like 30 hook tests over the same image and it can spit it out in five minutes versus that taking up, you know, a couple of hours of our junior graphic designer's time. So it's been illuminating in the sense of like what it's done in an additive way for our team, but then also how the platform iterates on the things that we do test and how to make more of it. Like, and it hasn't been replacing our shoot content at all, but it has helped us like company wide, like in a pinch. Like if we wanted to throw up a new digital bundle that we don't have imagery for, rather than having to go spend $5,000 on an e comm product shoot, we can give it our existing e comm imagery of those standalone products and it'll group them together. So there's been a lot of like iterations of it we've seen within, like the E comm business and the email business in particular, where we've been able to be so reactive, like same day reactive. And then there's also the performance marketing side of it where like we discovered these collages it spits out for fashion, which again, no humans. No human like models or anything. It's more so just fashion collages. That would take a lot of time for our design team. We're suddenly able to get 30 of them up in meta at the same time. And that was a really big thing for us in fashion. A place where like we spend less because the cacs are a little higher versus beauty. And we've seen that come down so much with the adora creative We've been able to spit out there that we've been able to up our paid budgets for fashion because of this creative we've built with them. So I know that was a lot. But it, it has helped us over so many areas of the business and went from being this vendor pitch to they had this proof of concept period that really just illuminated everything it could do for us which made it an absolute go.
- [34:22]
Brian Morrissey
Well how does a brand get in a brand. Sorry, how does a vendor get in front of you if they don't know? Gwyneth Paltrow
- [34:30]
Alexa Raffaele
Honestly, I don't know. I'm really bad with the vendor email pitches. Like I. It's tough so I think it's usually comes through like my network, like another CMO who recommends a vendor. I'm in this really cool group called Cart Stars. I don't know if you've heard of them. It's like an ecom networking programming group where like they put on different dinners and it's like really community driven and like contribution driven where like we have this site where people can ask like oh, what's the best vendor people are seeing for subscriptions for a beauty brand? That type of thing that those types of forums I think is where I find like there's trust because they're not going to have a sponsored dinner with that vendor unless it's been vetted by someone in the group. So like I was much more willing to entertain a conversation in that forum where it's not like a cold pitch, like it's warmed up to me in the sense of like it's involved in a community I'm already in.
- [35:30]
Brian Morrissey
So data. I have a data question. D2C brand like Goop has a lot of first party data like purchase history, email subscribers, what people are reading. I guess like beauty quiz responses, like people have actively opted in. It's just a lot of first party data. Every publisher wants that kind of information. Publisher E Commerce how well developed is your first party data strategy and are you activating against CRM and customer data for media and marketing? How are you using your first party data?
- [36:05]
Alexa Raffaele
We use it more so in service of the customer and like preferences, but we also use it in the way of like, you know, post purchase flows, segmentation like in service of like what serving them up, what we think they're going to want next based on the, you know, purchases of past customers who like everyone who's bought the peptide serum, what's their next most likely purchase? And then all of the people who come in on Peptide in the future are getting flows based on that past behavior. So it's a lot of like retention cohort tracking health of the customer, like more so measurement there. We're not. We use it for like retargeting ads and things like that, but not necessarily for like other media.
- [36:52]
Brian Morrissey
Yeah, no, fair enough. It's also sacrosanct. You have to be really careful with your customers.
- [36:56]
Alexa Raffaele
Totally. We're tight.
- [36:59]
Brian Morrissey
Okay. So the goop customer, and we talked about who the Goop customer is a little bit during the first half. But I think the core Goop customer tends to skew affluent, you know, health focused, probably in a life stage where she's spending like real money on herself and she feels comfortable doing that. But if you want to grow, you have to expand beyond your core. And you know, whether that's through beauty, the Ulta distribution, even like Goop Kitchen, like just wherever else. So broadening your customer base without like alienating the people who made you, like, that's a really hard marketing problem. And you have done this before when you were at the job before road. But what did you learn from that? And like, how do you get that balance right so that you're expanding, but you're also keeping the people who made you happy?
- [37:57]
Alexa Raffaele
Yeah, I think a lot of that comes through. Like, you know, we have our brand principles, this, the spirit and the tone of voice and all of that that we're going to stick to. But like a channel like influencer, especially micro influencers, allow us to reach different people through their audiences where they can put their handwriting on it, but it's not necessarily our handwriting. But still the product is approachable to them because it's coming through that channel. I also think price point has been a big one. Like you can see the differences in what the top products are by channel. Like our most expensive serum is the top product on goop.com but our, our top product on Amazon is the Himalayan Salt Scrub, which is more of like a $50 price point. But both of those costs, like the serum customer and the salt scrub customer are both interested in the opposite products there. So it's just like looking at entry points like an Amazon influencer looks totally different than someone we're driving to dot com. So it's like developing the different handwriting, but it all is laddering up to the same messaging, if that makes sense. Same with Ultra too. Like, that's a totally different customer. And the products that work in the Ulta store is completely different than what works on dot com.
- [39:17]
Brian Morrissey
Well, Ulta I Do want to talk about Ulta and retail media? They're obviously like very intertwined. ULTA has its own retail media network and retail media is one of the fastest growing channels in digital advertising. So when you're buying into a retail media network or when an advertiser is like the pitch is always like oh, we're perfectly targeted, it's first party, we're close to the point of purchase, we can measure it perfectly. But then there's like a skeptics view that you're maybe paying a toll to the retailer to reach customers who might have found you anyway like on the shelf or on your site. So where is there, where is there value and is there value for you in retail media as a, as a channel? What are you doing in that space if you're doing anything?
- [40:09]
Alexa Raffaele
I mean it's a bit of testing and learning right now. Like we're, I think we're a year old on dot com, less than a year retail, I think retail was August of last year. But it's really, it's been testing and learning like we want, we want to play ball and opt in to things but also want to make sure we're spending the dollars efficiently. And a lot of it has been testing our owned media dollars on Ulta influencers and like, like into their collective, like gifting the Ulta collective, testing out things there, spending some of our own paid media dollars linking towards Ulta and sending the traffic there to see if we see sales halo effects. So we're early days there but it is a lot of test and learn and wanting to find the balance of playing ball with the retailer while still, you know, feeling like we're putting our dollars in the right place to meaningfully grow the business.
- [41:04]
Brian Morrissey
So we're, we're nearly out of time. So I had a penultimate question for you about the content side of the business. Because we're a publisher, you started life as a publisher, content led brand and you have this whole editorial operation, a newsletter, a podcast. But I mean editorial like roi which feels so transactional to talk about but you really have to unless you're doing affiliate or something. It's just notoriously difficult. You can't necessarily draw a straight line between a story about, I don't know, cashmere robes or whatever to cashmere robe purchases. So how do you measure the contribution of your own content and the editorial operation? And is it more of like a faith based proposition and just knowing in your gut that you have to do this to keep the brand relevant and you know, feed into people's lives or are you actually able to draw those lines? Like, story about cashmere robe. Cashmere robe purchase?
- [42:03]
Alexa Raffaele
Yeah, I mean, we definitely can measure those lines and like, editors picks and those stories. Like, there are revenue stories, then there are discovery and like, the heart of the brand stories. And those two balance each other out really well. But I think the editorial arm of the business has done a really good job staying true to kind of like the goofy so and being in service of the customer. And like, that customer that has been with us 20 years is still opening that Tuesday and Thursday newsletter for the content. And we've protected those two. While, of course, there's product integration, where it makes sense, we've protected those two to really still be about the content. And as we activate that content on organic, social and all of that, like, it's clear, like the podcast, you know, the book lists, the things that we put out that have virtually no tie to our owned product are audience drivers for us. Those are some of our most engaging social moments and drive meaningful traffic to the site and then put those people in our funnel. So it. It's like a. If I were to put it in like a. A box, I guess I would put it as. As audience drivers. And like, brand is. It is the brand. It's an expression of the brand at the end of the day. And is brand marketing. Right.
- [43:17]
Brian Morrissey
I mean, lifestyle is a very, very, very big umbrella, and there's a lot that goes under it. All of the different things that make you part of someone's life. And it's not all just, here's something you should buy.
- [43:32]
Alexa Raffaele
Yeah.
- [43:32]
Brian Morrissey
Here's something that I think you'd. You'd like. And maybe that thing is not a thing. It's a thought or a concept.
- [43:39]
Alexa Raffaele
Totally.
- [43:41]
Brian Morrissey
So I. I know it's been just a little over a year in the CMO role, and I have to ask. This is something I. It's a goofy question. I'm spoiled. For examples here, I'm not sure if you guys actually still sell some of this stuff, but what is the goop product or idea that maybe you were skeptical about when you first joined? So there was like, psychic vampire repellent spray, the coffee enema kit, the. This smells like my vagina candle. First ever mention of the word vagina on this podcast. The jade egg or something else that. Yeah, you were skeptical about it, and then you came around to it. You're like, yeah, okay, I get it.
- [44:18]
Alexa Raffaele
Yeah. I mean, honestly, as it relates not to toot our own horn for a Second, the beauty products are incredible. So, like, I feel like the general consumer might have skepticism of the GOOP brand because of those past products, but the, the, the beauty products, we know what we're doing. Those have been like instant faves. I actually have that. It smells like my vagina candle. We haven't sold that while I've been here, but I've had many friends who've worked at goop, so I got my hands on it. It's an amazing smelling candle, despite what, what the haters might be saying. So I think that would be my favorite of the grouping you just described. But also, like, I've, I've leaned into, like, the wellness things and like, drinking bone broth first thing in the morning before my coffee. My stomach actually doesn't hurt as much anymore. Like, there is something to these, let's call them trends that are actually like, wellness practices that make meaningful, you know, impacts to women's lives. And I do think, like, Gwyneth loves to joke around and poke fun of herself and all of that, but, like, at the core of it, this content really is in service of the customer. And I have gotten service from that in. In some of these things that I have tried.
- [45:26]
Brian Morrissey
I love bone broth, by the way.
- [45:28]
Alexa Raffaele
I. Yeah.
- [45:29]
Brian Morrissey
Didn't realize that was a thing to have it before coffee. I'm a coffee fiend, but I also just.
- [45:33]
Alexa Raffaele
Yeah, no, I'm a coffee fiend too. But if you do the bone broth first, it, like, lines your stomach in a way where the acid from the coffee isn't going to be so hard on you. And also something about cortisol levels, but I've noticed a difference.
- [45:47]
Brian Morrissey
Something about cortisol levels?
- [45:48]
Alexa Raffaele
Yeah, something.
- [45:51]
Brian Morrissey
Well, I'll. I'll see you in Alaska and we'll. We'll drink some bone broth.
- [45:55]
Alexa Raffaele
Perfect. Sounds great. I can't wait.
- [46:08]
Sarah Sluice
This episode was sponsored by Basis, the leading intelligent operating system for autonomous advertising. Its enterprise AI solution transforms campaign briefs into strategies and media plans that integrate directly into omnichannel activation. Learn more at Basis.