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Marketing Operators
E029: How We're Planning For 2025 - Our Approaches, Strategies vs. Tactics & Knowing When To Pivot
01:27:49
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- [00:00]
Connor McDonald
Welcome to another episode of the Marketing Operators Podcast. We have a very fun one today. We are talking about some more Q4 planning to celebrate the first day of the fourth quarter. We are doing a little bit of a sweeps recap and talking about some of the data and insights that we got from that data. And finally we are talking about 2025 planning. Specifically, what is our approach? What are, you know, what's the delineation of strategies versus tactics? How do you communicate ownership to the team? All those fun things that lead to a very operationally efficient and strategically efficient year. Thank you again to our sponsors, mot, Prescient, Rich Panel and House. And as always, if you're enjoying the show like subscribe, comment your questions and share. Thanks again. So once Black Friday comes around, it's it's basically pencils down at that point with your ad creative, you pretty much need to have all of your testing done, understand what's working, what's not working, so you can roll those ads out for for Black Friday, Cyber Monday and Holiday to execute on your biggest time of the year and just really be in execution mode during that time of the year. So at Hexcloud we are all about naming conventions. Connor McDonald often says naming conventions are the lifeblood of any e commerce business and we really believe in that. We set up our naming conventions in a way so it is incredibly easy to visualize what is working, what is not working using a tool like Motion. So we are tagging static ads, video ads UGC hi Fi Lo Fi Circumflex Seasonal Evergreen Offer Any variable that you want to test in your ad account as long as you input that into your naming conventions, you can then organize by your naming conventions in a tool like Motion to visualize data and compare those ads to one another and see which ads are performing above your benchmarks. At your benchmarks. Below your benchmarks, you can figure out which new ads are incrementally or marginally better than the aggregate performance of that similar category. So if you launch a new batch of statics or a new seasonal holiday ad, you can compare to all your statics or all your seasonal holiday ads. That is how we approach it at Hexclad. It is so, so important for us optimizing our creative stack and just understanding what's working both in an Evergreen period and during a holiday offer period. So if you're ready to learn how the best DTC and e commerce brands use motion to ship winning Meta, tick tock and YouTube ads, book a demo today or create a free account@motion.com. motion offers a monthly subscription plan so you can dodge those annoying annual contracts. And if you mention marketing operators podcast to Motion sales team, you can get 50% off your first month. Check them out@motion.com. how we doing? What's going on, Cody? You. Are you guys doing well? Things are good?
- [02:42]
Cody
Doing well. First day of Q4. Can't believe it. It's finally here. The moment we've been dreaming about.
- [02:48]
Connor McDonald
Happy Q4 for all who celebrate. This is. This is actually. What we're gonna do is just like, crack our lollipops and just jam on. On Q4.
- [02:58]
Cody
Man, I wish I had one right now.
- [03:00]
Connor McDonald
Oh, you don't have one, Cody?
- [03:02]
Cody
No, I don't. I had one earlier. Not right now. I got some. Some whole foods, lemon. You know, it's got to have something a little different.
- [03:08]
Connor McDonald
Okay, fair enough. What do you. What are your thoughts on the. On the cherry vanilla? Is that.
- [03:12]
Cody
What do you think? You're drinking it live right now?
- [03:14]
Connor McDonald
I mean, I like it. It's. The vanilla is a nice touch. I'm a sucker for anything, like, anything. Any soda, anything carbonated with a hint of vanilla is always better. I like the. I think it's not quite as good as the orange one that has, like, the. It's like the orange vanilla, but it's still good.
- [03:33]
Cam
I think ollie pops are just severely overrated, but that's my take.
- [03:39]
Connor McDonald
Can you value gut health, Connor? How can you. How can you. You know, like, just more. Just more vegetables and in kimchi and you're. You don't need it.
- [03:48]
Cam
Yeah, exactly. And what, they're like, 50 calories or something?
- [03:52]
Cody
Yeah.
- [03:52]
Cam
Might just drink a Lacroix.
- [03:53]
Cody
I know you said you're. You're a big spin drip for me. I just have, like, a hardcore diet Coke addiction, so this helps get away from that.
- [04:00]
Connor McDonald
All right.
- [04:00]
Cam
Yeah. Yes. They're definitely better than that.
- [04:03]
Connor McDonald
There it is. There's the first mic drop of the episode. Hopefully that doesn't help happen again. You know what? You know what I don't think is overrated? And they're. My favorite sparkling beverage is. I might have spilled the beans here with you guys before. Do you. Do you want to take a guess?
- [04:17]
Cam
Diet ginger ale.
- [04:19]
Connor McDonald
Nope. They were a DTC hot brand for recess. Yes.
- [04:25]
Cody
Oh, yeah, we know. Yeah. You are recess guy.
- [04:27]
Connor McDonald
Yeah, I love recess. Recess is so good.
- [04:29]
Cam
My guilty pleasure is diet ginger ale. I think that's severely.
- [04:33]
Cody
That's your drink of choice, ginger ale.
- [04:35]
Connor McDonald
Really?
- [04:35]
Cam
Yeah.
- [04:36]
Connor McDonald
Straight. Not even. Not even. Like, you're Straight ginger ale.
- [04:41]
Cam
Just straight ginger ale? Yeah, dude. I picked it up during the pandemic. During the pandemic, I just drink room temperature diet ginger ales. That was my go to beverage.
- [04:49]
Connor McDonald
Room temperature.
- [04:51]
Cam
Now I. Now I refrigerate them.
- [04:54]
Connor McDonald
Wow. This is, this is a level up.
- [04:56]
Cam
This.
- [04:56]
Connor McDonald
That's so funny.
- [04:57]
Cody
That's like sear.
- [04:59]
Connor McDonald
That is awesome. Anyways, well, I think we could talk about DTC drinks for, for a while. I don't know about you guys. I'm excited about Q4. It's. I don't. I've never understood. Here's what I've never understood about Q4 though. You. I've never understood the people that are like, like Q4 is here, like, respect. This is a more relevant one or more more prevalent, I should say when like Black Friday time gets closer, it's like, all right, time to clock in those, those 12 hour days, those 14 hour days. I'm like, what have you been doing in the last four months that you need to work 12 hours a day during BFCM? Like, you should not be doing more work during BFCM except for like optimizing your ad accounts for the most part. Unless something's broken or you have some sort of learning that that makes you say, oh, we're gonna go build net new. Like, I don't. I mean, I work a lot during bfcm, but it's more so monitoring and optimizing. Like you shouldn't have to be putting in crazy hours once your offers go live. Unless you're maybe like a media buyer and you're managing like a huge ad account and there is a lot of optimization going on and moving of budgets going on. Do you guys have any thoughts on that or.
- [06:07]
Cody
I mean, I will have refresh, you know, shopify meta probably 100 times a day during like Black Friday Cyber Monday. But it's not really because you're working. It's just like a.
- [06:17]
Connor McDonald
No, it's just a dope rush.
- [06:19]
Cody
You're like, I'm on my phone the whole time. But yeah, you're, you're really not doing much. I mean you, like you said like everything should be set ahead of time. You know, final last minute QA and stuff like that, tweaking things. But yeah, otherwise the things should be set. But you do, you do need to be on at. During those times, you know, sneak away from family at times. Which has its pros and cons, but to be able to, you know, huddle with your human, be like, hey, how are we pacing? Which we could do an episode about leading up to it. If you guys think of, like, how we actually like what we do during those periods, that actually might be an interesting.
- [06:49]
Cam
Yeah, I mean, I would, I would agree for us, it's really just. There are maybe some more check ins. There are like, you know, especially during, you know, turkey five week of Black Friday, there are. You should be checking your ad account really early if you're planning on spending a lot of budget. So there, there are a couple long days there. Yeah, I don't know, I might, we might be jinxing ourselves also. Like, I'm thinking, yeah, you just execute the plan and then it's going to be, you know, six weeks from now and I'm going to be losing my mind because we're going to be making all these adjustments. But in theory, yeah, it shouldn't require all that much more work. I frankly, I felt like my Q3 was brutal. Largely because you have to execute on Q3 and you're planning for Q4. So like, we have content shoots and, you know, we're coordinating inventory and all of that. Like, it's actually like the work's very much front loaded.
- [07:34]
Cody
For sure. I agree with that. That's, that's why I always find it funny when you get these like cold emails and they're like, like, you get them today, like first day Q4 and you're like, cody, do you need to add creative? Or like, I got one that was like, do you need SEO for Q4? Like, guaranteed. I'm like, you're either the best in the world at SEO and you're going to like rank me in like three weeks or like, this is the biggest BS I've ever heard, dude.
- [07:57]
Cam
And the cold out the cold outreach that comes like the week before Black Friday is the craziest. October 1st. Okay, maybe you can convince me you'll make some impact, you know, six weeks from now. But like, dude, you'll have, you'll have agencies reaching out to you like November 23rd, and they'll be like, I can upscale your ad account for Black Friday. It's just like the most absurd thing.
- [08:17]
Cody
So absurd.
- [08:18]
Cam
Yeah.
- [08:18]
Connor McDonald
Connor, you don't care about lowering your CAC 38. The. The day of Black Friday. What's wrong?
- [08:23]
Cody
You must hate profit.
- [08:25]
Cam
Yeah. And it was that. I was waiting. I'm just waiting for the, for the right person to reach out.
- [08:31]
Connor McDonald
Well, all right, let me, let me rephrase that then. I think that there's still a lot of work to do during, during Q, like bscm, but I think like funnel production work should certainly probably not for the most part be happening. I, I agree. I think it's really fun to have regular team huddles even if they're just for 10 minutes during Q4. I think it's important even if, even for the folks that aren't as connected to the performance just to keep them in the loop and let them know like how everything's going and, and it. Just because they're not as connected to the performance doesn't mean their work they're doing isn't like super paramount for driving that performance. So we like to do that as well where we'll meet like everybody every other day during the week, even if it's just quick and then maybe there actually are some things we need to troubleshoot. I think a lot of the work though is like that intraday intra hour pacing slash efficiency check ins and you're just constantly like just trying to decide if you should spend more, spend less or keep spend flat. So for us that's you know, myself and Cam and our, our main paid social buyer Ky Kyle will be linking a lot and London will be linking a lot during those moments to decide how we should be manipulating budget up or down. But other than that it's like let's let the, let's let the funnel do its thing. Let's let the traffic flow through what we built.
- [09:46]
Cam
Yeah. Yeah, totally. So where are you guys at in terms of like funnel building, Connor? Are you guys, do you guys have all landing pages baked or like where are you at in that process?
- [09:57]
Connor McDonald
We actually, we don't, we tested this a ton last year and we don't use a lot of, a lot of landing pages outside of our core evergreen ones for sale period. So we'll like update our core landing pages to include like BFCM banners. But for the most part all of our work goes into setting up our core website. We actually haven't started design on it but we have like the wireframes ready to go and then there's some net new stuff we still need to build out. So I would like, for the most part our website is ready in the sense that we're building off of a lot of designs that we and user experience that we've built out before and then like same for the ad creative. We don't necessarily have it ready yet but we know for the most part what we're going to take and just iterate on and then we're in the process of building out any net new concepting right now. So I would say we're like at least 50% of the way there if you think about it from that lens.
- [10:51]
Cam
Yeah. Cool. We're in a similar bucket. I was just curious. We're going to have way more breadth this year, like between. I mean we're going to build that landing. Like this is what we did for sweeps and I know we want to touch on sweeps a little bit, but we came into sweeps with like a nice arsenal of like landing pages and messaging. And we've launched the campaign with three landing page tests, one in each category, found winners there and then scaled behind those essentially made smaller adjustments throughout the period. So we're trying to go into Black Friday Cyber Monday with the same, that same mentality, like a ton of iron in the fire. And for us, we have such a broad catalog at this point between NFL, mlb, Collegiate, we'll have a dedicated gift giving, we'll have kids, we'll have individual wallets. Even things like NASA and leather we want to speak to specifically. So we're just, we've quickly become. We're going to cast a much Wider net this Q4 than others and that's just required way more prep work.
- [11:40]
Connor McDonald
Yeah, that's kind of where we're at too with just because of what we've built Evergreen funnels around this year. Right. Like we're at. We've basically added four new categories into.
- [11:51]
Cam
Right.
- [11:52]
Connor McDonald
Our just our paid media acquisition mix. And because of that like we need to have very segmented targeted campaigns in paid media in retention to those people that we that are in those funnels. So kind of the same thing. Like we, we need to build out more knives specific creative and hexmill specific creative across those channels to make sure that we're remarketing to all those people that visited the site, opted in, did whatever showed intent towards those products. So yeah, I, I would say we're probably not gonna, I keep saying this to our like our HR and like our hiring department. I'm like if, if we want to build out acquisition funnels and more and, and, and more things around these other products, which I agree we should do. It's not like we're going to be sending net more emails. Like we're just me sending more creatives to the same number of like inboxes, it's just segmented more. It's just more creative to the same number of inboxes. So that's how we've been thinking about and, and honestly your feedback on how you kind of pot up your team based on certain Product categories. Has it actually been really effective for us? Cause we're starting to like wrap our heads around the resourcing we need. Like if we want to have all email SMS design and copy internal, plus give all the product categories the moments they deserve and need to give them to hit our targets. Like what does that mean from a email designer, email strategist, copywriter, stack. So it's been helpful to think about that kind of pod approach you guys have.
- [13:14]
Cam
Yeah, totally.
- [13:15]
Connor McDonald
Cody, what about you guys? How are you? I know we probably have an episode coming up on this in the next two weeks it sounds like, but how are you looking? Just quick preview of. Of BFCM holiday prep.
- [13:26]
Cody
Same here. I think a lot of it. You know, we've talked about this like on the motion webinar. A lot of it should be just tried and true either from previous Black Fridays, previous Memorial Day, which we kind of consider a tune up. Previous tests that we've ran throughout the year. So like, you know, for, for us we run, you know, most of our paid traffic through a landing page we call Trojan Horse. So like we kind of just duplicate that. We'll really go off, you know, last year's template that we had, but make any changes for this year and then any tests that we kind of rolled out into our control will be a part of that. So I just saw like draft one of it today, you know, super easy to do in repl. The bigger one. We have a few bigger changes. We want it for the first time especially because we have a director E commerce now who has like bandwidth to do this. We're building out like, I don't know what you call it. It's not a collections page. It's like, I guess it's a landing page but not like a paid social landing page to have like our whole holiday collection on it. So you know, just all draft one of that. So that's being designed right now and then we are switching how we do our. Our mini miracle bombs and we're actually trying to build some new functionality and designs into that. So we hired a freelance UX designer. So that's also underway. So it'll be close, cutting, cutting it close I would say. Normally we're just rinsing and repeating either stuff from previous period or throughout the year. So you know, like you guys, like we're chilling. A lot of the work should be done ahead of time. But we got a few things that are new that you know, that we are working through right now. And we'll have to get it Designed and then finalized dev ahead of time, but, but feeling good about the timelines. Creative. Same thing a lot. Most of it has already been shot. We, we did a video shoot, you know, maybe three weeks back, but statics have been in the work. So most of it we're feeling pretty good about.
- [14:59]
Connor McDonald
Yeah, that's the fun part. It's like, it's like all right, 70% of this is going to be from what we did last year, plus what we've learned and built out this year. And then 30%, that's where I'm like, you know, turning the lights off, computer on, just like scheming like what, what innovative things can we do that I think will perform better? And, and that's like the third percent that's really, really fun to work on. We have some really cool landing pages getting built out right now that are also not, they're not paid media destination pages. They're just experience, just really experience driven pages that are going to be just really fun to interact with during this time of year. So our, we've done an amazing job with that. Like our head of content, our head of content has like really learned how to make beautiful landing pages. Now it's been really cool to see him like take his unique skill set of being an amazing producer and like learn how to, you know, he's learned the importance of landing pages and like where, where and when to use them. And now he's like able to produce these really cool, compelling pages that are more brand forward. So I'm excited to see. We did a little bit of that last year and they got a ton of traffic and I think they're going to be just way better this year. So I'm excited to see those come to life and kind of see how people engage with them and all that jazz. And we actually just hired a director of CRO that started on Monday. So I'm excited to kind of plug him into some of those pages as well and kind of get his thoughts on like hey, this, the, the purpose of this page is not necessarily to convert. However, like I still think there's a way to optimize it in terms of engagement time on site, stuff like that. So I'm excited to kind of plug him in and see what, what kind of like, you know, quote unquote performance optimizations he can make to pages like that.
- [16:39]
Cam
Did you know that platforms over report performance 65% of the time? In a recent study house found that 82% of incrementality experiments showed that platform reporting was either underreporting or overreporting by more than 25% and 60% of the experiments showed discrepancies of more than 50% is why marketers are moving away from platform attribution towards incrementality measurement in order to maximize their growth and efficiency. This is one of the many reasons that the three of us, Connor, Cody and I all work with House. So what is House? It's a self serve experimentation platform that allows you to configure regional tests and control experiments to measure incrementality and identify points of diminishing returns. What does that really mean? They tell you, hey, These are the 40 zip codes you need to exclude from this campaign and we can look at what results did you drive in the targeted regions compared to that holdout group? Really awesome. We use it all the time. As an example, we just identified a lot of our non branded ring search and shopping campaigns were not nearly as incremental as Google as was reporting. So we've been growing a ring business over 100% year over year and spending less on Google. So we've been able to be more efficient with every dollar spent. Houses built with cutting edge methods by PhD economists and data scientists who have built these solutions before at companies like Amazon and Google. The House platform allows you to test all your marketing channels both online and offline, measure the impact across all your sales channels, dtc, retail, Amazon and calibrate your platform reporting for incrementality with House. Discover your marketing's true ROI and unlock new growth with House. Go to House IO operators spelled H A U S.IO/ operators to start your incrementality practice today.
- [18:18]
Connor McDonald
Cool. All right, let's got some fun Q Q4 stuff cooking. We had, we had to talk a little bit about BFCM holiday planning with it being day one of Q4, but what we got today. So we're going to talk about sweepstakes for a little bit and then we're going to go a little bit. We're actually going to skip over Q4 and we're going to go into Q, sorry 2025 planning and just talk about some process there. So starting off with sweepstakes though, you know Connor, I wanted to kick it over to you. You guys wrapped your sweepstakes. I'm just curious generally like what are some of the big conclusions? Can you, can you point to any like quantitative conclusions or like performance and sweep sads, opt in rates? Anything that you saw or can draw conclusions from running the sweeps?
- [19:01]
Cam
Yeah, so, so coming into this call we did a postmortem a couple weeks ago. We wrapped up our sweeps September 15th. So it was just over two weeks ago. We're actually, we moved our sweeps up last year. This been a really funny thing and I don't know how much like nuance you guys have to deal with on this end, but we've had these caveats in year over year comps now for a while because we moved our sweeps up this year. So we've been comping sweeps now for the last two weeks. It's super annoying to explain that on like every time we review year over.
- [19:28]
Connor McDonald
Year numbers, but dude, I totally get that because I'm looking, I'm like, well Friday from when we launched through yesterday and I'm trying to like find the analogous period of last September. Right. It's like, okay, well it has to be the third Friday. It has to include the same amount of weekends. Total. Total. I have to like, you have to subtract out new custom. Like we dropped a product last year. We didn't do that this year. Like we got to subtract that out. There's a lot of nuance to creating a, a fair year over year, period over period. Com. So I get that, man. I've been, I've been doing the same thing.
- [19:57]
Cam
Yeah, yeah, I've heard you mention it a little bit and this is the first time we've ever done it. Like I've never cared about calendar weeks before this year and then now it's like we're just, it's like the language that we're speaking adjusting for the day of week. So it's like a two day adjustment you need to make right now. So you're comparing Sunday Sundays. Yeah. Classic. Yeah. So anyway, so we wrapped up suites two weeks ago. We, we just are now comping it completely a couple of the highlights just to talk to them. One was very successful. We were really happy with it. We, we ended the period up 30% year over year we spent 30% more. So maintained efficiency scaled. Um, a lot of that came from new categories. So like our ring business really benefited from sweeps this year. We'd spent a lot of time investing in new content for that category. So overall super strong led to a really strong Q3 for us. Bigger than Q2, first time that's ever happened. And then a couple of the other like new, new tactics and I'm stealing some of your language that we're going to get to Connor. But tactics and initiatives, we wanted to do the real time entry tracking so we used revo as we mentioned. So you could see how many entries you're checking out with once you create an account. If you purchase multiple times, you're signing up for email, sms, all those entries are added up. Revo ended up being like our official ledger for all of that. And actually the like basically the database that we submitted to our legal partners to choose the winner, so they're like instrumental in the whole thing, provided a great customer experience. And I think a big piece of that was we were able to improve our retention rate year over year. So the rate at which someone made their first and second order within the sweepstakes period was up like 25 or 30%. It's really hard to attribute that back to the entries. For instance, we also had like product launches and things like that. But all those things together just making it a better customer experience made someone more likely to become a second time customer. So it was a big win. And then lastly we did a.
- [21:51]
Cody
That sounded like a Revo ad for a minute. I wasn't sure where you're going with that. Thought you were about to hit them with like a call to action for Revo.
- [21:58]
Cam
No, dude, I was hyped on it though. We've looked at a bunch of sweepstake sites and like, you know, whatever, we did it with Revo. But this idea of like transparency into entry tracking I think is super valuable.
- [22:11]
Connor McDonald
Dude, it's unreal. Like the. I was, I also was so pumped about the user experience that they were able to build out. Like you go in, you hit login, it takes you to that login page. It's a confirmation code that you log in with and then the UI changes once you're logged in. To show you an itemized receipt basically of like, okay, you email 15 SMS 25 order on this date 108. Like it's, it's really cool. It really enhances the experience and, and it gets read a lot.
- [22:40]
Cam
I get, I get JRB's not a sweepstakes brand. Cody. And then. All right, so sorry, last thing last. Last year we did a mystery wallet deal for the first time. And sweepstakes is cool because it's a full, it's largely a full price period. We had, we had a small promo section this year, but it's largely a full price period. So I think there's a lot of like pent up demand and you can kind of like relieve some of that pressure with like this mystery wallet without discounting some of the core styles. So we ended up extending that. We did it for a longer Period. Totally crushed. We moved through a bunch of stuff we were over inventoried in so ended up being a big commercial success, efficient from an inventory standpoint and it's like gamified so it like totally plays into the whole sweepstake thing. So those are some of like our big takeaways that ended up to like a really strong growth period. I've got well the other things, 45 million entries, I got that down. That's how many we ended up clocking. Are you kidding me? But that's because I mean it doesn't really mean anything unless you know like the entry Mechanics. Right. Every dollar spent is a, is a dollar entry but you get 4x entries on the, on the exclusive products, you get 10 entries for SMS etc. You see how it adds up really quickly. So 45 million entries and yeah, we ended up collecting 220,000 SMS's. More emails than that I think it was, I didn't check but it's got to be above 250k so felt really good about it from like a lead gen perspective the SMS growth was like a massive win year over year.
- [24:10]
Connor McDonald
What are you doing? I want to run through some of our learnings so far but I want to ask what are you doing post? All right, so sweeps ends, you roll up bfc, you roll out holiday offer, you get to end of the year. What, what are you looking at to understand like how effect, like how much revenue did the opt ins turn into? Right, how much, what's the second repeat order rates on like people that bought during sweeps? Maybe even through like a sweeps ad or something. Like what kind of like post offer period analysis are you doing to understand even more about that list and those people.
- [24:49]
Cam
Yeah, so I mean really what our takeaway has been in the past is that the people aren't worth that much after the sweepstakes. We, and we, we've talked about this a bit before. We don't think of it so much as a lead gen tool. We think of it as a way to drive revenue in this period and we're not necessarily counting on these people to be particularly qualified going into our holiday sale. So our biggest learning has actually been, and I think I mentioned this as well, is to just not send too much to those people, particularly with sms. Last year we kind of ballooned our SMS cost sending to unqualified people. So we want to be more efficient in that this year and we're going to continue to be efficient now once we get to the kickoff of our holiday sale or certain product Drops will kind of expand the segment. So we'll hit that larger base. But. And we'll see potentially over time maybe these people become worth more. Maybe if they're prospects from ring ads or travel ads, they'll behave differently than the wallet ads. But that's our approach, being thoughtful about it because they are largely unqualified. And then we will slowly roll it out and then maybe we'll reassess at the end of the year if those people had much if any incremental value outside of that sweepstakes period.
- [25:59]
Connor McDonald
Right, right. That, that's what I'm excited to plug that list into our customer data platform and see how much, how many orders and revenue actually came from them at the end of the year. And then I need to figure out like how to create an apples to apples comparison between our evergreen list. Probably just like, like obviously revenue per subscriber will be interesting, but I'm trying. I need to figure out what the comp is to be like, well did the overall net volume like you know, the same way like if conversion rate goes up a ton but AOV comes down more than that, it's like, okay, well you're losing revenue. I need to figure that out. I'm really excited to, to dig into that and see if, if those leads do show up for us at the end of the, at the end of the year. But how did you. I mean we're seeing good performance, like good performance now as well. Like mainly seen through our year over year sales growth rates. Like if you look at Q3 year over year on Shopify versus just the the year over year and period over period comps from when the sweeps launch. Like we're certainly seeing a bump in growth rate which is awesome. And that's same here. Right. That's what we were ultimately trying to do. I'm noticing the ads are crushing. Like I was shocked at, at the one day click performance of our sweepstakes ads. Like at the end of the day like you still got to go and buy expensive ass cookware to get more entries in this sweep. So I wasn't sure. Like I, I totally expected to see a huge spike in opt in rates and just net email SMS capture which we're seeing. But it wasn't. I was un, I was. Not that I wasn't expecting, I was just unsure I think on the ad performance. But the one day click's been really strong. We've been, we've been scaling it up and spending more and we luckily produced a ton of creatives. So I think we have a lot of opportunity to horizontally scale over the next four weeks. But did you. Did you guys see the same thing? Like did you see really good one day click performance out of your. Your Facebook ads and really any ads compared. Compared to just Evergreen non sweeps ads?
- [27:46]
Cam
Yeah. So one thing that we track is we'll like, we'll categorize our ads by we'll call it campaign type. So last year, I forget the exact percentages, but only maybe 50% of the account actually went to sweepstakes ads. We were actually able to increase that year over year. So that, that being said, we actually saw better performance from our sweepstakes ads relative to Evergreen this year. We would spend more dollars on those. And I think one of the reasons we were able to scale further. But otherwise, yeah, I mean we really, I think you kind of have to revamp a lot of your ads where if you're going into like a Black Friday Cyber Monday and your core products are just discounted, Evergreen can work that. I. But I think in this case, like you want to, at least for us, we want to talk about the cars. Right. We want to talk about the winners that we've given in the past $100,000 prize, things like that. There's just so many more additional talking points that we want to highlight. And there's a story around like why we don't, why we do it, how we've done it that we want to tell. And I think that's where most of the value is. It's not so much like a promotion is like a conversion rate increase on Evergreen ads. I don't think sweepstakes has that same effect. You don't just hit, you know, a sticky note ad come through, realize you can win a cybertruck and become significantly more likely to purchase. Yeah, at least I don't think that would be my. That would be my initial.
- [29:01]
Connor McDonald
We're actually seeing that right now. I was looking at that right now. And, and like sweeps are definitely perking up the entire account. But I'm, I'm even noticing that period over period trends in our non sweeps ads are also like for the most part green across the board. So yeah, I guess it's working. You know, people are hitting the side, I guess, and seeing that messaging, whether they're landed on the homepage or the product page or a collection page. And it seems to be that they're more likely to convert and they're converting a higher profitability clip because of that. That web build that we have rolling.
- [29:36]
Cam
Right now Yeah, I mean you guys have a great sweepstakes. I'm super, I'm super stoked to see how it goes. Did you do a bonus entry period yet?
- [29:43]
Connor McDonald
We did, yes. So we had our first one last weekend. Awesome signs. Like our revenue was up 31% weekend over weekend. Our conversion rate was up 34% weekend over weekend. And you know, some pretty clear, clear moments on the Shopify graph like when the text and emails.
- [29:59]
Cam
Yeah, yeah.
- [29:59]
Connor McDonald
And then you see that massive spike and so that's been good to see. I'm, I think I'm maybe most happy with our non cookware performance. Like we basically doubled it the first weekend over the previous weekend of non sweeps versus first week in a sweeps. And then we, it went up a big time again this weekend obviously because we ran the 2x entry. So I'm very happy that our like product merchandising strategy has worked out how we wanted it to. The other really interesting data point is the AOV on sweeps ads. So first off, one day click row as on sweeps looking really good. The AOV on sweeps ads is much lower than our like account wide aov which is really interesting to me in CAC as you can like back into is also super, super, super low compared to the account wide aggregates. So my hype, my, my bullish hypothesis is that people are coming in, they're opting in, they're making orders of one to two products because they want to get that enhanced entry by making an order. I'm hoping that because they're only buying one or two things in this first order that when we roll out our offers in BSCM that these people are going to come back in a major way. So that's the other, the other cohort that I'm excited to like put under a magnifying glass is basically saying cohort together all people who bought with a UTM like campaign equals whatever our Facebook ad campaign name is and just see what their reorder rates are it like towards the end of the year and then compare that to our, to our evergreen like just you know, business wide reorder rate and see if it's marginally better. Because I think, I think it could be.
- [31:40]
Cam
Yeah, I could totally, I could totally see that crush, you know, and then we could talk about this stuff. I know we have a lot to get to, but I'd also, I'd also maybe hypothesize that even those lower value customers with the lower AOV are at least passionate about cooking. Right. The reason they're Purchasing it all is like, go on this insane, like, eating trip. So it's like, they're clearly passionate about food and that leading to ltv. Like, I could believe that our guys coming in, like, really wanting to win a Hennessey velociraptor. And then it's like, right, like the, the key case or the pen is not. Not as relevant to them. So the fact that you guys, you guys have something that pulls through and really, you know, I don't know, capitalizes on, like, the underlying interest that people have in cooking and, and hexclad. In that it's cool.
- [32:26]
Connor McDonald
Yeah. Yeah, definitely. And that. That was very, like, our core. We've identified our core archetype as the cooking enthusiast. And the cooking enthusiast is basically someone who. Cooking is truly a. A hobby for them. It relieves stress. They enjoy doing it. They look forward to doing it.
- [32:42]
Cody
They're.
- [32:42]
Connor McDonald
They're experimental. They're not. They're more concerned with, like, having fun and trying new things than. Than they necessarily are with, like, the judgment of the outcome. And, like, we definitely were thinking about that person when we were crafting this, like, experience, so.
- [32:57]
Cam
Totally.
- [32:57]
Connor McDonald
I agree. I agree with you. I'm. I'm still. We'll see what happens on the email list. Like, that's. That's the one I'm. I'm still unsure about. And we won't really know until, you know, November 20th. Something take.
- [33:10]
Cam
Yeah, we'll have to do a followup. We can both. We can both review our sweepstakes, you know, LTV performance at the end of the year. Yes.
- [33:17]
Connor McDonald
Yes, That'll be fun. That'll be a fun test of the week.
- [33:22]
Cody
So one thing we talk about a lot on this podcast is upper Funnel investment measuring, YouTube measuring, TV measuring, you know, out of home, all that kind of good stuff. It's something that's top of mind, but it's not very easy to do. Recently, Jones Road turned to prescient AI to help us as our new MMM Media mix modeling tool. And we have been super impressed, no joke. It's really helped to quantify some of the things that we thought were true. Some of the things that some of our tests, you know, showed us, but especially TV, was very hard to measure. We were spending about 10% of budget on TV and we just weren't really sure how it was doing. Spoiler alert. Test of the week. It's actually looking great. It's actually looking like our most efficient channel. Thanks, Depression. AI. So we are in the midst of scaling it up and Results look good. We are very happy with it. YouTube looks great as well. You know, been been spending and scaling up YouTube a lot based on this data. So we are very happy with it. It's actually not something that we were getting. We didn't feel like we had confident data back from other MMM providers that we worked with before. And so we are thrilled with some of the prescient data that we are getting. We're getting halo effects. We're actually able to see, you know, how much value are we driving directly from clicks on channel versus how much is coming through or organic direct. And it's quite a bit. Being able to measure TV has been really difficult until now, but it feels very accurate and it's giving us a lot of confidence. Things are volatile in D2C. We're able to build these new optimizations, these new scenarios, you know, within days. Setup was super easy. Unbiased cross channel, you know, measurement. We're not on Amazon, but I know brands like hexcloud will use it to also measure and validate, you know, spend going to Amazon. And so we're thrilled, we're super happy with it. Couldn't believe how easy it was. And the team is getting a lot of value out of there. Those are used by top brands like of course, Jones Road, none other than Hexclad, Good American Symbiotica, Timbuktu and many, many more. Mike, the co founder hits me and Connor up pretty much every day just telling them about some of the new brands that signed a lot of them from listening to this. So we are thrilled with Prescient. It's made a huge difference so far and it's really going to help us leaning into Q Q4. So if you want to be like us, like Hexclad, like Jones Road and many more, go to pressionai.com operators to book a demo and see for yourself.
- [35:32]
Connor McDonald
All right, so Q1 or sorry, first day of Q4, I should say we're talking about 2025 planning. Though obviously we're not overlooking Q4. It's the most important part of the year. But we got to hit the ground running and you got to find that balance. But between executing on Q4 and planning for the next year. So Cody, I'm gonna start with you here just, just to kick it off and set the stage. Like, when do you guys at Jones road beauty begin 2025 planning?
- [35:59]
Cody
Man, that's a great question. I'm super curious how you guys do it. I would guess we probably do it later. I Guess some stuff we've been. It depends what it is, so I can kind of share different timelines. Some stuff we've been planning, some stuff is a little bit last minute. I definitely, I like to ruminate on things. I just, I like to think about it, you know, talk to others, get some feedback, like, think about our growth opportunities and expansion plans and just really go back and forth in my mind about it. But I won't really put it in motion until a little bit later. So even a lot of this stuff, you know, like, we're. I'm scheduling with my, you know, my marketing leadership team, like a meeting coming up soon. We've had, you know, side conversations, but a lot for a lot of our big plans. We're. We're really starting to kick it off now. But it's, It's a challenging time because it is Q4 and people have a lot of things to do to get ready for it. But like Connor said, Q3 is also kind of crazy, so it is definitely interesting. And also, like, I don't want to say I'm not involved in Q4, but I'm probably less involved in Q4 than I've been in the past. So a lot of my time is going on that. So it depends on the department. So product, like, we've got, you know, a big January launch that has been in the works for probably two years just because there's some regulatory stuff. So, like, product can be two years in the making. Retail, those things, you know, are just moving slower for us. So, you know, we're. We're very close to signing three leases for Q1 of new openings. And then, you know, then we can really begin. You know, we want to open six to eight next year. So we feel like if we get, you know, 3 for Q1, then we feel like we're. We're off to a pretty good start. So that takes quite a long time. We've been working on a lot of those for, you know, six months plus. That's what I was out and can't share. Where. But where. Wherever you are right now, looking at spaces. So hopefully we're gonna sign a lease out there and hopefully be able to announce it soon. But that was the reason for the trip. That and some, Some. Some good food. And then, you know, I would say marketing probably takes the least amount of time. Definitely happy to share and talk about, like, what our strategies are and, you know, how we're going to, you know, operationalize that. I know you like to think about strategy and tactics, but I would say it just depends based on the time frame because it's, you know, really trying to think about channels, markets, products, and then what's the marketing, you know, what's the marketing strategy to really support those things? But I don't get, I don't get crazy with it. I remember like 2023, I was like, all right, like, we're a real company now. We're trying to do, you know, whatever we're trying to do. Maybe it was 2022. And I was like, we got to do okrs. And we talked about it, you know, a few weeks ago, got super involved with it, super in depth. Took us like a quarter to plan them. And I was just like, this is way too much. And I was actually thinking about it this morning as I was listening to, I was listening to the founders podcast, going over that Mr. Beast memo. And I got fired up just like thinking like, of like putting things in writing, kind of like in a memo. So I started jotting down some notes and thinking about it today and it reminded me, I looked at, I've got this document that's like our 2022 marketing strategy. And I just made like a ton of bullet points of like, things I wanted to do that I think we needed to do. And I forgot about this document until like a few weeks ago. And I looked at it and I was like, it was really cool to see like, how many of those actually came true or like became our strategy. And so that's going to be my approach this year, is I'm literally going to do bullet points of everything to my team and just share it and be like, this is what I think is important. And like, I almost like the simplicity of that. It's like if you can't write your goals down on just like a bullet point, it's almost too complicated. And I think that's kind of the approach I'm trying to take with it is like, here's where I'm trying to get to. Let me articulate it, let me speak it, let me write it. And here's bullet points. Does anyone have anything they want to add to it? So that's going to be my approach this year.
- [39:38]
Connor McDonald
Yeah. The packaging of the, of the strategies should never get in the way of the actual content. That, yeah, that's like a, it was.
- [39:45]
Cody
Like a full time job, just like making the goals. Yeah, no one's got time for that.
- [39:50]
Connor McDonald
Beware of marketers that make beautiful decks.
- [39:52]
Cody
Yeah.
- [39:54]
Connor McDonald
Okay. And I think one of the takeaways I'm hearing Is like, different. It's not. All right, planning starts today. It ends on this other day. Like, in reality, different things start and end on different dates. You might need like, this retail store rollout. I'm sure you've been thinking about this for like the whole year probably, and that's technically 2025 planning. Interesting. That makes sense.
- [40:17]
Cody
Yeah. We've got hires we've made. One last thing. We've got hires we've made six months ago or three months ago are people that we're hoping to tire soon for next year as well. So it's very staggered.
- [40:25]
Connor McDonald
How about you?
- [40:26]
Cam
Yeah, I'll. I'll run through where we're at, just so people get a sense. And it's a good. It's a good kind of example of the. The sequence of events. 1. I'll say we hired a CEO. We've. We've hired a lot of, like, new senior executives over the last year. So we have a coo, VP of finance, we have a director of people. So we are just, from an operational perspective, in a much better spot than we've ever been. So what does that mean for right now? One, we've had revenue plan for 2025 by month, by category, by market, essentially for at least six weeks now. Four weeks, something. Four to six weeks, something like that. It's been a while. Um, we've already ordered all the launches for Q2. We just did a visual line plan for Q3. This is where you could see it's like all kind of stacking up. Right. We go from a revenue goal to that becoming the plan for Q2 launches, making sure we're getting those ordered before Chinese New Year, so they're landing in the time that we're expecting. We do the visual line plan. So, like, we haven't even talked about cost or anything like that. Just visually, does it do what we want to do? Are we speaking to the demos that we need? We just did that for Q3. And then where's marketing and creative at? We're going to start shooting for Q1 launches, hopefully by the end of this month, early November. So it is for sure the fastest. There's times in the past where, like, if we're launching something January six, we're not shooting it to like December 5th, 10th or something, 10th or 15th, like, we'll just be way behind. But this year we're trying to get more out in front of. Of these things. So that's where we're at currently.
- [41:57]
Cody
Currently.
- [41:58]
Cam
And then, yeah, I think I'm front running Some other stuff that, that we're gonna get to. But in terms of like setting goals, one thing that we're doing that I'm excited about is we've got six cornerstone projects and then we've got a champion of each one and the champions, like helping lay out the vision. And then it becomes like tactics beneath that. So we have scale travel as, as one of the cornerstones and our director of paid social is leading that. There's like a laundry list of items that we can put together that are tactics from their cross departmental. So they're coming from anywhere in the organization that are laddering up into scaling travel. And that's just a way more kind of structured way than we've ever thought about it before. So you've got six of those and then long list beneath each of those and then people owning each one. They're the champions of those cornerstones so they can be responsible for holding people accountable and reporting back and making sure we're like continuing to progress towards those goals. So that's how we get down to more like maybe iterative stuff or you know, tactic or initiative level.
- [42:56]
Cody
And I got, I got so many questions. Can I ask you though, slightly different?
- [43:01]
Cam
Yeah.
- [43:02]
Cody
Do you guys find as you grow you are having to do just like everything a little bit earlier? Like, like shoots and stuff like that? It's something we find at least. And we're pushing our timelines up for our whole launch process. Just feel like things just take longer as you get bigger. Do you guys see that as well?
- [43:18]
Cam
Dude, totally. I mean, and we also went, I've said this many times, but like we went from being a brand that like rarely launched anything. So we were just always in market. We were never like, we didn't have to be super coordinated across channels. There weren't many launch dates to now we're a brand where we're like basically having like new product launches almost every week. And then you roll in like international changes and things like that. Like our go to market board is just stacked. So the best thing we could possibly do from an execution standpoint is just extend those timelines as much as possible. Get product summaries in marketing, summaries in copy, content created so they can hand those off to channel managers. So we're not just like sprinting every single week to get some go to market item live. So yeah, short answer is like, absolutely, I'm with you.
- [44:04]
Cody
Yeah. It's such a muscle. It's like product launch muscle of like just rinse and repeat and doing it over and over because you get better with it over time. But I agree having, having that time to kind of breathe, especially when you have like multiple you're working on at once, which we all probably do. Other one. So like you said, you're your paid social manager or director. Paid social is going to, is going to champion the, the scale travel. How do you think about who is going to own those or you know, champion them? Especially one when I would imagine there's a lot of factors and you know, it's not just a paid social thing. There's probably a lot of dude products, synergies and things like that that play with it.
- [44:42]
Cam
Yeah. So I was thinking about it like the way I described it to the team because I was like, I'm trying to think of a good example. So another one of our cornerstones is winning with our like female demo. Right. So we want to expand into women. So another cornerstone is winning with that demo that is in like, that's almost like a product first problem. Like we're, we, we need to address that problem far more upstream. Sure. You can say like we could be launching ads and testing messaging, but ultimately we've got a couple wallets that seem to resonate with women. Like we need to backtrack a little bit more, truly understand who that person is and how do we design products for them. So that's an example of something that requires I think kind of an initial point that is far further upstream then travel, which I think is more in a place to scale. So women winning with women is going from 0 to 1. I think travel is a better example of going 1 to 2. We have the key pieces of a business where it should be tens of millions of dollars a year. So it's way more of a growth initiative at that point. So it's not to say product doesn't play a role. They'll have deliverables within that, but just in terms of what's the 8020, 8020 for travels coming from growth, I think 8020 for scaling into women is probably cracking what product looks like. So it's, it's a, it's like maturity. Yeah, yeah, got it.
- [46:02]
Connor McDonald
So, all right. This is a good transition because I, I've thought a lot about like the delineation of strateg. The delineation and the convergence of like strategies and tactics. I think too often they, they get, they get confused. Right. Like I like someone will come to you like what's your strategy for growth this year? It's like they're like, well, we're gonna, we're gonna produce way more like, high production value, product focus, content. Like, that is not a strategy, that's a tactic. Your strategy is to like, focus and like, enhance customer acquisition in some way. Like, that is a tactic that is aligned with that strategy. And I actually think that delineating between the two is really helpful because the way that we look at things is like, we have, we have strategies and we use these strategies for the entire year, right? So like, as an example, efficiently, efficiently scale winning channels to maintain or improve our rate of new customer velocity. Like, that might be a strategy. And then the tactics could be produce more Facebook ads to reach new audiences and do that, right? So I think that's generally kind of not for fully understood and I think it can often lead to a lot of confusion. And if you don't have everyone on the same page of like, some people are putting in strategy, like true strategies, some people are putting in tactics, and both are important. But the way that we approach, like, planning is we start with the strategies and then once we all agree and feel good about what the strategies are, then we fill those, fill those strategies in with, like, how are we actually going to do this? Okay, well, here comes the tactics, right? Like, here are the tactics that are going to ladder into these strategies the most, and then ultimately they become a tool or they become a filter, right? So we're all getting hit with new projects and new vendors wanting to work with us and do all these different things, and you kind of need a filter to say yes or no to things. So for example, like, if my, if I have the strategy of like increasing our new customer order velocity for the third year in a row or something like that, and I get a channel, like a new, like a rep from a new channel that comes to me and says, hey, like, you know, we think we can get you a super efficient cpa. And I start digging into it, I'm like, oh, like, I don't think these guys could even account for like 2% of our total first time order volume. Well, chances are even though that that channel could probably get me into super efficient cpa, I'm probably gonna say no just because I don't think it's worth spending our time there where we could take that 10 hours and put it into like more Facebook ads. Whereas if our strategy was to like, be as efficient as possible in customer acquisition, then I'm saying something totally different to that opportunity. So it's Connor, it sounds like you guys call them cornerstones. I Would love to hear how you, how like A, you think about strategies versus tactics and then B, any sort of like functional implementation of that within Ridge.
- [48:53]
Cam
Yeah, yeah. I mean I, I think I. Like I said, uh, this is the most organized we've ever been. So it's not as if this is like a, even a proven process for us. We're going through it for the first time. Um, but that is, it's the, I think it's a great example of the delineation. Ours are very general. Like a couple of our other ones are international localization. So you could say that a number of ways that cornerstone could also be grow international, I guess scale international. Like that's our focus there. But in this case it's localized international and maybe we should rename it or whatever. Right. We think that localizing international markets will lead to growth.
- [49:30]
Connor McDonald
It could be like grow, insert market name and the tactic is like build process around language localization.
- [49:36]
Cam
Yeah, and that's exactly that. So our senior manager of E Comms is running our, let's call it grow internationally. I think that will largely come from localizing those markets. And why our senior manager of Ecom Ops is in charge of it. He's the closest to that. He's sitting over the operations of all of these, you know, six Shopify instances. He's overseeing language localization with the overseas team that we have managing that. He's worked close with customer service and tech to make sure that like the E Comm product is working the way that it needs to across Shopify markets. So he's just in this ideal place to own these markets. But his list of items at the end of the day are like, are cross departmental. So he's got the longest list of things that we can implement from an E Comm perspective that we think will help lead to growth. But at the same time we're going to bring on a creative agency just for international ads. We're going to start with the uk. What does it look like to just create content that feels more English than the, you know, domestic winners that will port over to those markets? You know, we're going to bring on a different agency to scale even in Asia because that's like a completely different thing that we have no idea how to execute on. I'm trying to think of some other ones. There's different products buying across markets. So coin trays, which are the little trays that allow you to hold coins in your Ridge wallet, are way more popular in more coin centric currencies. So like those are valuable in those markets. And we should be thinking about that from an ordering perspective and an offer perspective. So it's just very like holistic way of thinking about it. Historically, that very holistic thing has rolled up to like the very top. Like it's either me trying to oversee that or Sean trying to oversee that, our CEO. And yeah, now we're like, we're, we're appointing these champions who can help oversee that. So that's more or less how it looks and I think it's a good delineation of strategy and initiative to use your language.
- [51:29]
Cody
Yeah, two things I'll say. I don't know if you guys have studied OKRs and again, like I said, they didn't work for us, but I think they, they have good delineation where you know, an objective is kind of like what Connor is saying is the strategy. That's kind of like the thing I want to happen. I want to grow our international business might be the objective. And then the key results are usually like the three things that support that and they're either how you're going to get it done or how you're going to measure it. So I think that's like a good way to think about it. So even though I don't like following that anymore and I like keeping it know, simpler than that, I think that's important. But, but Connor, one thing on that you, you said it used to be top down and you guys are obviously a more mature business than, than we are and now you're kind of, you know, having, having other people kind of champion those. What, what, what led to that? Very curious about that kind of culturally. Is it, is it just as the business grows. That's natural. Were there specific things that were kind of creating friction that you, you thought it was more important to kind of have somebody else lead these rather than you and Sean?
- [52:25]
Cam
Well, we've had them in the like, I'm think going into this year we had a similar thing. We had 12 things. So we had a lot of like, we didn't call them cornerstones, which was just the 12 things. And each of those things was technically owned by a person and we would like report around that. But yeah, again it rolled up all the way to like the founders and like senior leadership where we thought this was an example of we're all staying close to it. Like it's all still a conversation that's happening amongst the executives. Like it is what we think, think are key objectives that we have for the business. But one, do we need to be managing like the day to day of it. Not necessarily. And two, it's a great opportunity to like empower key people from across the business. And we have like senior managers and directors and VPs contributing. So it's just kind of a smorgasbord of people who we want to give the opportunity to really lead strategy on a key objective. And I think there's many benefits that. So we'll see how it goes. Like I said, this is the first time that we'll have like delegated it in this way, if delegation is the right word. So it'll look and feel a little different.
- [53:29]
Connor McDonald
How do you see your. I mean, this is, it's so. I mean, I've been like reading the Mr. Beast thing on and off so frequently because I love the message it sends so much. And it's. You're. You're creating a. Just a ton of accountability. It's like this project starts and ends with you. How do you anticipate your role? Like if someone else is owning the project and it's on them and they have the accountability for it to get done and go well and all that jazz, like, what's your role in the process? Is it more like you have set milestones where you come in and review the project and give feedback? Like, you're kind of like the final sign off. Is it like the 10, 80, 10 rule?
- [54:08]
Cam
So what's the 10, 80, 10 rule, Cody?
- [54:12]
Connor McDonald
You told me it.
- [54:12]
Cody
I gave him that. Yeah. One of, one of the business coaches, mentors I worked with was like, you know, like, here's like a framework for, let's say you're working with a director on your team. You're like, hey, first 10, I'm gonna give you, like, I'm gonna give you a direction. Hey, this is what I want this landing page to look like. Here's what I want. Here's what I think it has to have got that good, go do it. They work on 80% of it and then they bring you back the last 10% just to kind of give some feedback, find, fine tune it. So just like a delegation framework.
- [54:39]
Cam
It's a great framework. It's probably not quite. I mean, it's something like that. It's probably technically like, like, what would it be? 4:20, 4:24:20, like, you know. Yeah, yeah. Oh, yeah.
- [54:54]
Cody
That happens along the way.
- [54:55]
Connor McDonald
Yeah, yeah, yeah, totally.
- [54:57]
Cam
Yeah.
- [54:57]
Connor McDonald
So I think the same thing. That's interesting.
- [55:00]
Cam
So, like, in a couple weeks, the champions are going to like present their plans. And I talked with the people on my team who are champions. So we kind of touched base on those. So we could help like refine the strategy and then we'll see how it goes. I, I think there's going to be the scenario, like if we go back to scaling travel, for instance, like we're going to have a list of tactics that we think will roll up into scaling travel and hitting our revenue goals for this for next year. At the same time, there's going to be adjustments. Right. It's silly to think that, you know, October 15th we're going to know exactly what we need to execute on for all of 2025. So I think it will be an ongoing discussion. But just this framework of like, we're going to lay out the high priority items that are, that are laddering up into this goal is, is good. And now we have a form of leadership. So I'll keep everyone posted. We'll see what the kind of iterative process is like throughout the year.
- [55:49]
Connor McDonald
That's exciting.
- [55:50]
Cody
Definitely. I like that framework and that approach a lot. So definitely excited to hear how it goes.
- [55:54]
Cam
Well, I was also just going to say the tactics are also laid out over quarters, which I think is, is helpful. So like, we have a spreadsheet built out. Like, we have state, we have the champion, we have stakeholders, Q1, Q2, Q3, Q4. We're laying out those tactics over time and you can see them like, so we're also considering this component of time, which is also. We've made that mistake in the past too where it's like you try to accomplish everything immediately and it's like, you should have some sense of sequencing.
- [56:22]
Cody
So we recently switched to rich panel and I'm, I'm pumped. We're loving it so far. I just can't believe how easy migration was. It was super easy. We actually were considering waiting. We just hired a new director of CX and, and I was a little bit bummed at first because she was like, hey, you know what, I think we should wait till after Q4. But she got on a demo with them. I asked her to do it. She actually did one before where she used to work and she told me, she was like, I can't believe I forgot how much I love it. I just, I want to do it right now. It's just so much better than what we're currently using, what she's used in the past. And we've been so super pleased with it. The support has been great and switching was super easy. I actually couldn't believe how easy it was our team picked it up super easily. I can't say enough good things. Just, just sincerely I can't say enough good things about their team and here's why else I love it. Our response time went way down since switching it was much higher than when you know than it should have been. On other platforms we were able to add in some auto tagging, some rules, number of tickets has gone down, response times have been down. The UX is way cleaner is what I've heard from our team. The data and reporting is so much better better than everything else I've used and we haven't even scratched the surface on the AI capabilities. We're about to do a demo their new kind of AI social moderation tool. Looks sick. Looks awesome. I know Rich has been Ridge has been using that so I'm really pumped about that but just the migration it couldn't have been easier. We're paying a much better price than we were with other ones and that's all in we've got the self serve features which are awesome to help reduce number of tickets. I just can't say enough good things. It's really helped our team our function and I'm super happy with it. So if you also want to be like us like Ridge, switch over Like I said migration is a breeze. Just book a demo on rich panel.com.
- [58:01]
Connor McDonald
So I want to I want to ask one more question to you guys on this topic. I and my inspo for this is the classic the classic finance versus marketing like there there's often butting heads in an org and like we're no different where like finance often in my experience and this is nothing against finance it's just like not their their bread and butter not what they've experienced in their careers but like I think generally speaking often folks in your finance department don't necessarily understand the degradation of like spend an efficient or like they don't understand the degradation of efficiency as you increase spend and just the relationship of like you know that that next dollar being marginally less efficient whatever. I I think one of the classic examples of like competing strategies is top line revenue growth and efficiency and like what's required to to hit each like that's a classic example of of competing strategies. Do you guys ever feel do you have any like strategies recently that you've realized were actually competing? Do you have any tact like any ways to ensure that you don't have competing strategies where actually like tactics like tactics to hit one of the strategies is actually moving you like Almost like directly connected to moving you further away from the other strategy and vice versa. Cody, you said you gotta, you got.
- [59:23]
Cody
I got two good ones. Yeah. So speaking of like my goal setting approach and just like writing stuff down on a napkin, one of my big goals for the year was, was to align and I, I wish I could find this napkin somewhere. But one of my big goals was to align marketing and finance because that was a pain point we had last year. Happened with some, some team reorg and restructure which I, which is I think for the best. But that was a big component. Untraditional Org. Now we're like marketing finance reports to me and I kind of do our like top line forecasting was because of that. It just felt so disjointed and I felt like there was too much friction between these sides and it wasn't always, we weren't always optimizing towards what was best for the business or both sides were just not optimizing towards the same outcome together.
- [60:06]
Connor McDonald
Yeah.
- [60:06]
Cody
And so I think that's a lot of what I think about. It's, it's, you know, trying to align incentives and do that. You, you have to be, you have to be on the same page. You know, you've got to have, you know, people have to put egos aside and just say, hey, here's what's best for the business and here is why. And I'll do it like today. Like I have a really good relationship with our demand planner, but we'll, we'll share. Here's my data. Here's what I think is going to happen. Here's why. Tell me where you think I'm wrong and then same thing. Here's why I think you're wrong and, and you know, it just makes us all better. So as long as you can kind of put the egos aside and do what's within your control and sometimes you have to be the bigger person or be more vulnerable or work harder to see it from their perspective. Because I think we probably don't, we probably all get really passionate and we want to prove our point and say, hey, this is, this is what I need you to do. This is what we're doing. You're wrong. But obviously that's just like, you know, that's just like running into a brick wall. So I, I think there's definitely strategies to, to how to navigate it, but I think the more you can get those sides aligned is really helpful. So that would be number one. And even on that note. So like what, what, what Kind of mentioned about like the champion. The reason I was asking about like who owns it or who's running it, if it's like paid social, because there are so many other pieces. You know, I'm always huge on like the, the whole like, show me the incentive and I'll show you the outcome. I remember, I remember when we were planning our EU launch for this year and hired a brand new chief of staff and part of, part of the reason we brought her on was to lead some of these special projects so we maybe wouldn't hire a full time person to do, you know, we didn't need a director, VP of International, but had her lead it and kind of she reports like the Chief Product officer. And I remember she was working on it and there was a little like friction between, between finance, between ops. They wanted to go with different providers and they were giving different recommendations on what we should do. And I like gave her a heads up beforehand. I was like. And she kind of was just, maybe she wasn't empowered enough in her role at the time. And she was just giving me their recommendations for what she thought we should do. And I was like, here's why that doesn't work. Because OPS is going to want what makes OPS life easier. Finance wants what's going to make finance lives easier. You know, and I want what's hopefully what's best for the business.
- [62:13]
Connor McDonald
Switzerland here.
- [62:14]
Cody
Well, and that's what she is. And I was like, I was like, you report to me, but like I was like the reason that you were asked to do this is because you don't have one department that you're, that you're representing. And so hopefully she can kind of, you know, zoom out and, and have that approach where she's a little bit more neutral and oh, I like that.
- [62:32]
Connor McDonald
She's almost a mediator. She has no idea.
- [62:34]
Cody
Kind of a little bit.
- [62:34]
Connor McDonald
That's cool.
- [62:35]
Cody
Kind of. And so she has, hopefully she's got my, my incentives which is, you know, business. But she's not, she's not beholden to marketing or to finance or to demand planning or ops. And so, you know, not every business has a chief of staff. That's, that's general across one thing. But I would say that's, that's something at least I'm, I'm conscious of as well. And you know, ultimately that's why a lot of decisions ladder up to the CEO because they are the one who is obviously the only person in the company who's overseeing a little bit of everything. But, but you have to balance that with not wanting to do everything top down and, and wanting to empower people. And also a lot of the best work and ideas are even going to come from, you know, not the executive suite at a certain level.
- [63:15]
Connor McDonald
I like that. Connor, what about you? Any. Any thoughts?
- [63:18]
Cam
Well, let me pass it to you first. Do you, do you have any. Any examples?
- [63:23]
Connor McDonald
Yeah, I think. Well, the, the one I gave is like the example I wrote down is one strategy could be maintain or increase the rate of new customer acquisition. The other strategy could be improve efficiency on customer acquisition. Right. These are two opposing strategies. The re. The reason, I think, I think the re like you see it come through in the tactics though, because I think the surface level, like when you just see the strategies written out, it's like, it's not as obvious. But then when you look at the actual tactics to hit each, like if you look at Facebook ads, like, tactic to hit, the first strategy of like maintaining or increasing the rate of new customer acquisition would be, well, we're going to increase the amount of creative that we produce for Facebook and we're just going to spend more on Facebook ads. Okay, well, it becomes pretty clear right away that that is going to be an anti. Anti the strategy number two of like improving and being as efficient as possible on your new customer acquisition. So we is just quickly.
- [64:20]
Cam
Is the third one. So, so you want to. You want to scale, you want to increase efficiency and there's a third one. You want to turn water into wine. Is that.
- [64:30]
Connor McDonald
Exactly right? But we like to. We don't do it in a silo. Right? Like, it's not like the growth. It's not like paid media has their own stuff and attention as their own stuff. And like, and functionally they do. But we're pretty public about the strategies and the tactics that we're focused on. And I think for us that's the tooling to make sure that like, I don't want, you know, Cam to hear something from Cam, who runs our paid media department to hear something from someone else and then think, actually I do want them to think, oh wait, that's actually like working against one of my goals. And like, we need to work that out. So that's how we. We just kind of try to create this like, internal, like operating in public almost. So everyone's just like hyper aware of. Of what and like everyone's key results and initiatives for the quarter. They all live in the same spreadsheet. They're organized by tab. Like, anyone can go into that sheet and see what anyone is, is responsible for like the champion of, to use your language for the quarter. So I think that's an interesting way to, to go about it. But yeah, I mean we're, you know, one of the strategies I have written down for next year is exactly what Cody just said, which is to enhance the, the relation, the working relationship and working operations between growth, marketing and finance. So that's just like the classic example that's, that's on, on the top of my head right now.
- [65:44]
Cody
You know, Data man, one, one thing data. Yeah, you, you want, you know, more leverage. You want to win, I don't want to say win arguments, but you want to be able to establish your point. You want to be able to, you know, this is not, again this is not you but anyone like have marketing, you know, be taken more seriously, you know, at the board level or at the C suite, C suite level or leadership level or whatever is like you can't argue with data. You know. And so if, if a marketer wants to say hey, I don't think that these financial projections are realistic because we're not going to be able to improve efficiency as we scale volume 40%. I would either, you know, show what the, the previous data has been and show a correlation between how does our CAC increase as our spend grows, you know, or then build a, build a model and build a projection and say hey, here's what I think will happen. I do think, you know, we will if, if you're asking us to spend 40% more, I, I think we can do that. I think the volume is there, but here's what I think will happen to our efficiency. Are you okay with that?
- [66:47]
Connor McDonald
100, 100%. And that's pretty much exactly what we did. We, we basically were like hey, here's, here's what we think CAC's going to do at all these different top line year over year growth scenarios. Here's why we think it's going to do that. And the final computation was like, here's how much we think we need to spend then to hit 60, 50, 40, 36% growth, whatever it was. Those are just, those aren't even actual numbers. And then here's the contribution margin at each of those top line revenue numbers and efficiency like pretty clear here that we should shoot for this one based on all this. So you're totally right on that.
- [67:23]
Cody
And that's something I've done at the board level is we talk about like Sean, sensitivity analysis but like I've done a few high level forecasts and been like, here's what I think our contribution margin, ultimately our profit will be at a few of these different spend and efficiency levels. Like here's five, six scenarios. Like, yeah, here's what I think we could do. Which one do you guys want? Like, and like I literally asked the Lord like what their, what their thoughts are and we had a conversation about it. But I think that's certainly something if, you know, if I was in that position again or you know, in the position you're describing, like I would, I would do that and I would give that to finance and be like, hey, what do you think?
- [67:59]
Connor McDonald
Pretty. Yeah, it's kind of, kind of what we've done, which is, I love it. Which is funny. Another good example, Connor, we had, we have this like the strategy to build the brand equity in the European markets that we built in the US And I think there's a lot of ways that we can do that. I think a lot of it comes through the content that you're putting out into your channels. Right? Like I think if we can launch and scale YouTube and streaming TV and linear TV in, in EU UK, like we've done in the US that we're gonna like ultimately build that, build that brand equity. I think it comes through in a lot of other ways, but I think that's a major one. Um, at the same time we had these like insane revenue targets year over year and because of that we would get to like the end of the month or halfway through. We're not pacing and all of a sudden we're like rolling out an offer to like hit these insane revenue targets. Like that's an example where we are devaluing the brand at a short term revenue target that is very, very, very much doing the exact opposite of that like build brand equity strategy. It's a classic example where we needed to adjust our revenue forecasts in order to create an environment where we didn't feel the need to like be so offer forward to hit those revenue targets so we could build that brand equity. So that's, that's, that, that's another one that happened this year and we, we adjusted accordingly. We lowered our forecast a little bit, you know, one.
- [69:22]
Cam
Oh, okay, cool. Go ahead, Cody.
- [69:23]
Cody
I was going to say one thing you can do is constraints. And I've seen this and you know, I hate to always bring it back to okrs, but seeing this as well. So here's what we want to happen, here's how we're going to do it. Here's what we're not going to do. And given sometimes given constraints and just being like, hey, here's what we're not going to do to do this because again, in terms of that like performance versus brand thing, that's kind of somewhere where it's like, yeah, you give your, your growth team, you know, a metric and a strategy or tactic and incentivize that they're going to pull the levers that they have available to them. So sometimes you have to make it clear, here are what our levers are. Not as tempting as they are. These are, these are a constraint.
- [69:58]
Connor McDonald
Yeah, that's. I was having that conversation with our director of CRO today that we just hired. I'm like going through his key results and initiatives for the quarter. In one of them, I was like, should we have like a hit rate target? Right. Like you have an X number of tests ran that you know, provide a bump in revenue per, per site visitor with the caveat that these are not like price offer oriented tests. Right. Like they are evergreen tests. So, so you're, you're totally right. Those constraints can be, can be useful.
- [70:26]
Cam
I was gonna. This isn't quite answering the original question, but there's this. I don't the, the, it's not that the initiatives conflict necessarily, but they can't all happen in like a positive some way. And I think that's a. You actually just laid that out, Connor, where it's like, look, you can't, you can't. At least this year you weren't able to both grow revenue and build brand equity at the same time. Or for us, and it partially comes down to like bandwidth. Right. We came into this year wanting to grow more of a women's business and we definitely have and we'll have done a couple million dollars in these new kind of female forward colorways. But at the same time, when like Q2 is a little rocky and we're not hitting goals in like the core business, it's like, yeah, we're no longer able to hit grow the women's business. Right. And there are these constant trade offs that I think are easy to over overlook when you're putting those together because you think of hey, these are all positive sum. We actually I'll be able to write all these down on a sheet and they won't conflict with one one another when sometimes they conflict directly. Like, like literally both can't be executed on or just from a bandwidth perspective like certain ones take up significant more time or a new, you know, like I said, Q2 was rough. We have trouble growing. Okay. We have the new initiative of getting back to growth, which is actually like the six different initiatives. So anyway, I think that one's interesting as well. And just like having almost like a real time pulse on where you're spending your time and what trade offs are you making as you make decisions is, is key.
- [71:54]
Connor McDonald
Yeah, yeah.
- [71:56]
Cody
How, how do you guys balance, like some of the goals are, you know, like I think, you know, you said a goal might be to localize, you know, international or Connor Hexclad said it might be to launch, you know, TV and YouTube and international because you think that's going to grow. How do you balance that strategy when it's not guaranteed to get the result right? Like you could launch YouTube and TV there and, and localize and actually not hit your growth goals. Like when do you know when to pivot? Because I think part of the, the challenge of having a goal like that, that's not, that's more process based and outcome based. I see the pros. It keeps you focused, focused. It's more actionable, what you can control. But you know, some of the cons are that it can be, you know, it can kind of lead you astray and maybe it's not the thing you should do. And I don't think any of us are going to be 100%. I bet probably half of the things I, you know, I write down that we should do are actually going to be things we can accomplish or things we actually should do in hindsight.
- [72:51]
Connor McDonald
Yeah, that's a good one. Go. Connor, you want to go ahead?
- [72:54]
Cam
No, I was going to say, I think I, at least how I imagine this Cornerstone initiative project going is that it will be iterative like these, these champions will put together the list and some things we will execute on and they won't work. So that's when I think like I'll be playing a key role in scaling travel. Like, okay, let's intervene, let's course correct. Let's pivot here. There's also going to be instances where things work or don't work and that will lead us to new tactics that weren't otherwise on the list at the beginning of the year. Like, it's silly to think that, you know, midway through this month we'll lay out everything we need to do within each quarter. But setting up these like general guide so that we're having the right conversations, looking at the right data and are ultimately anchored on this like higher level initiative of scale travel, grow international, win with women. That is what like that's what functionally it's supposed to be doing better.
- [73:49]
Cody
And how do you guys. Sorry to hijack all the questions. I just have a lot. How do you guys communicate this one thing? I realize I'm terrible. I think I'm pretty good at being really strategic. Like I'll have it in my mind like ahead of time. These are the four things we need to this year. These are the five things and like I'll do that at a board level and a leadership level. But like I think I'm actually pretty bad at it to the rest of my team and I don't know if everyone knows what my priorities are for the business. How do you guys communicate these strategies, you know, to the team? Do you have like a process for that?
- [74:18]
Connor McDonald
I mean we, we use the, we use this like that pyramid of clarity framework where we basically have like mission. Then you have your strategies, that ladder in the mission, you have your objectives, that ladder in the strategies. Objectives are like basically a year long outlook on, on like. So as an example, like we might have the objective for the year of like launching a loyalty program and then the different like subsequent parts of that would be broken out into the quarter really key results. So like we might have the yearly objective, but then this quarter it might just be like to like plan out the user experience of it and, and plan out the, the different tiers and then like ultimately it'll lead into launching it at some point. But we're just like, I mean we spend three weeks at the end of every quarter and again this is only the second quarter we've done it. But it's, it worked incredibly well for us last quarter compared to previous quarters. So we spend a lot of time being intentional about it. And then like I said, it's just public and it's very clear like who is who. Like Andrew, Wendell, you own these 10 things period. No one else. Like, yes, you're going to collaborate on other people of course to do them, but at the end of the day like the success or failure of these things, you know, ends with you. So, so you know, you got to go do what you got to do to make it happen. And like we're very forward with that communication and just making sure there's no confusion. And, and I also say that to my team, I'm like, guys, at the end of the day the outcome is the most important thing. I don't care if the process was up. I don't care if like you had to follow up 15 times with someone to get unblocked like, it still is your responsibility. And like, yes, we should fix those things to make it easier for you. Like, we should fix the process. We should figure out why, you know, Johnny wasn't answering you and getting you what you needed. But it's still up, up to you. And like, we just, I think, have like hammered that into our culture or are trying to at least. And it's, you know, it's just resulted in people being clear. I also tell people, like, how can I move up? I'm like, do the things we say that we're gonna do. Like if we outline 10 things every quarter for you to do and you've done them all for the last four quarters, like, it's me. Pretty impossible for anyone to look at your performance and say you're not deserving of a promotion or a title or pay increase.
- [76:26]
Cam
We have, yeah, we, we had an executive just on that point, he would always say, don't let others let you fail. Which is just like a great succinct way of saying that. So we definitely, we definitely try to get that done as well. Yeah, so we lay out like, I mean, this year we had the 12 things coming into 2025. We'll have the six cornerstones. In short, I don't think I'm great at articulating it either. Especially as goals shift throughout the year. I think it's really hard to clearly like pivot objectives. We are like anchored. Yeah, totally. Right. And this year has been like a roller coaster a bit. I think what we are anchored around is go to market items. We're launching stuff like almost weekly. So everybody's really clear in terms of like how we're executing towards that. And then we're anchored around category projections by market. So ultimately all of like the go to market items ladder into that as well as all the in market initiatives. Then there are, there's a shorter list of new things we want to try. So like partnerships, for instance. I wanted to do bigger and deeper integrations, get ad rights, pull those across channels. So when I was talking to our director of partnerships, that's at like the top of the list every day. That's what I expect to be like reported on. What are the, what's the progress we're making towards that goal? And that was beneficial. And then doing that across all my direct reports. Sports is a way to like on a weekly or bi weekly basis, continue speaking back to the channel. Relevant things that are laddering up into our ultimate goals.
- [77:56]
Connor McDonald
And that's what we'll, that's what we'll move into like now as we get into Q4 and we have our KR and I is finalized, like that's the next part of the conversation is like, okay, you have these 10 things but like these three are the most important. I want you to focus here first before you even think about the other ones. And like that's where all the updates and reveals views are coming in.
- [78:15]
Cody
Connor, that's a good point though, that when things change, it's. It's so easy to talk about the good stuff. I feel like most people, it's just probably such like, it's like a good reminder to me, but probably to a lot of people it's like, hey, it's. It's hard to say, hey team. This strategy that I said we should do didn't really pan out. It was a terrible idea. And I think a lot of people just like try to sweep it under the rug. But that's probably a really important thing from like a leadership and vulnerability perspective. Billy, be like, hey, we tried this. No longer a goal, no longer a focus. We're going to deprive that like no shame in that. Showing the team that there's no shame. Yeah.
- [78:48]
Cam
Or like for us it was. I'll give a good example actually. Like we came in 12 things, long list of things to do. Ambitious projections across all accounts and really what very. And, and maybe this should have been obvious in hindsight, but what became the ultimate goal was actually just better process, process and standardization. So it was like, look, we're not going to hit our category goals across all our markets with our current, current performance creative workflows. We actually had to completely reset. And I was like, we figured that out early. Like end of January, February was like, okay, no, now the goal is like, we're not going to do all this cool flashy stuff that we initially talked about. We need to get back to the basics of like, how are we producing better concepts at a higher volume, delivering those weekly and delivering those across a number of different strategies. So like that was one from an E Comm perspective. It was like we were doing way too much. I don't know if you guys fall into this trap at all, but we were like designing new stuff just to design new stuff. It wasn't all that beneficial. Creating development time, all sorts of stuff. And it was like, no. Standardization was like the mantra from mid Q1 through Q2. Let's just standardize everything I say. Given us. That's given us the ability to execute at a much higher volume and it's like, oh, we actually needed to set a much stronger baseline before throwing on what actually felt net new. And maybe that's like the point that I'm making here is initiatives feel like they should be new and a perfectly good initiative is to get better at what you currently do. And I think that's where we've spent most of 2024.
- [80:17]
Cody
That's so much. I do love that. That's amazing. Especially as you grow and you add team members and you're trying to do stuff faster and everything gets bigger.
- [80:24]
Cam
Yeah, totally.
- [80:26]
Cody
It's. It's kind of like what Connor was talking about like of marketing spend and volume and efficiency. You should always be trying to improve efficiency as you scale. But just know it's not, it's likely not going to be better. It's very hard. It's going to be harder. There's going to be a lot of things that make your marketing spend less efficient as you scale. There's going to be a lot of things that are going to make your team less efficient as you scale and add people and things like that. But it doesn't mean you shouldn't be trying to do it because you almost have to to fight that.
- [80:52]
Cam
And that's the, that's the unsexy work. That's my. I talk about hero dreams of sushi. Have you seen this movie? He's this very famous Japanese sushi chef and he's famous for just like he doesn't do fancy sushi's. He just has. It's very simple but he has the absolute best stuff. It's a great movie but he's doing it for like 65 years or whatever. He's really old at this point. Every day he goes in the same methodical routine. Routine. It just focuses on getting a little bit better every day. And there's something like meditative about it and unsexy about it and something that like at least I aspire to because I think that's ultimately like what we need to look more like if we're going to accomplish all of our goals.
- [81:33]
Connor McDonald
I'm adding it to my things to watch.
- [81:35]
Cody
Yeah, I haven't seen it, but yeah. Definitely familiar with the story. Couldn't agree more. It's like those little things like naming conventions, just nailing conventions.
- [81:42]
Cam
Thank you. Thank you.
- [81:43]
Cody
Also have you guys. Connor, what do you call the thing you said to do it to your team? You have like a tool that you use. Yeah. What do you, what do you call a thing to communicate the we.
- [81:55]
Connor McDonald
So the, the framework My, the mentor I've been working with. And he didn't, he didn't start it. It was actually, I think the dust, Dustin Moskovitz or whatever his last name is that started this through Asana. But it's called the Pyramid of Clarity is the framework. And there's tons of, there's tons of like online literature about it and how it all works.
- [82:16]
Cody
Have you guys seen Silicon Valley?
- [82:18]
Connor McDonald
Oh, yeah.
- [82:19]
Cody
Every time you say that, I think of the conjoined triangles.
- [82:22]
Cam
Absolutely. It sounds like.
- [82:26]
Cody
I can't stop thinking about that now.
- [82:29]
Connor McDonald
I'm gonna change my name to Action Jack Barker. All right, we are going to transition into test of the week. Connor's got a good one for us on international prize price testing. Connor, what do you got? What have you been testing? What are you finding out?
- [82:42]
Cam
Yeah. Cool. So as I just mentioned, one of our cornerstones going into 2025 is to grow international. And we think doing that via, we're calling it localization. So content, all these things. And a big, I guess this came up in a leadership meeting a couple weeks ago going into Q4. How do we maximize the value we can extract from these markets? An easy one is to say promo more. And this kind of hits. I'll tie in the point Connor hit earlier where if we want to build brand equity, we don't always want to always be on promo. Like we need to figure out how do we acquire customers with full price products in any market. And it's silly. And what we had been doing, which frankly worked really well for a long time, was we would just take our USD equivalent prices and convert those to local currencies and then we would just tack on that. So if you look at a market like the, the UK, there's 20% VAT that you have to show in, in the price that you're displaying on a, on a PDP, I think it's 20% in Australia, 10% in EU, something like that. So effectively significantly higher prices with this VAT and in the local currency. And why we've been calling this localized price testing is people in the UK are just not as willing to spend, might not be as willing to spend $95 or the, the, the, the pound equivalent for a minimalist metal wallet. That is just maybe not like a typical consumer behavior in these new markets. So we took that and we did some like comp research. We looked at competitors. How are they localizing prices? We saw kind of differing things, but largely people were at their highest price in the US and they were selling at ineffective discount in these international markets. We tested that, we reduced UK prices 15%. So not significant. And what's exciting was actually don't have this data right off the top, but we saw these massive improvements in conversion rate, 30, 40% improvement in conversion rate with the 15% decline in the MSRP price. Right. So that's like easy you can understand where, where we are in like the price in, in elasticity curve or elasticity curve is like we can make small movements, get these disproportionate increases in conversion rate, increases in profit per session. That's what we were looking at in this test. But what I thought was also really, really interesting was 15 decrease in prices. We only saw a 7% decrease in AOV. So what that means was we were converting a marginal buyer at these lower prices, but there was also someone who was opting into kits, they were buying more accessories that at that lower price they were actually willing to purchase additional items. So we saw an increase in units per transaction. So it was just like a very simple test that came from the thesis of hey, we should localize our prices to what consumers in these markets are willing to pay. And we saw very interesting kind of buying behavior come from that. So that is my test of the week and my initial contribution to our 2025 cornerstone of growing International.
- [85:31]
Cody
I love that. And your, your main KPI being profit per session.
- [85:36]
Cam
Profit per session was the main KPI. Yeah.
- [85:39]
Cody
Awesome. I love it. We are actually about to ca off our, our first pricing test. We haven't done any. I've got hopefully a good test of the week for next week, but we're about to do it for Canada as well. We're actually going to go the other way because we are, we are considering. We realize we're not really baking in some of these VAT and duties as much as we should be to Canada.
- [85:56]
Connor McDonald
Right.
- [85:57]
Cody
So we're going to start there and see and, and our team was going to roll it out and I'm like, I don't feel comfortable doing this without a test. And so we want to do that. But we are having a similar issue with UK where we're just. Our conversion rate is just not where we want it to be there. So that might, might have to be something we consider for future.
- [86:12]
Cam
Yeah, totally. There's, there's a lot to kind of play with. I mean last year international we grew 100% year over year. So like these high prices worked to a degree. We've also just seen a bunch of economic data like we just brought on an international agency to help with some of the paid media stuff. And they were saying, like in the EU and UK there are a lot of variable interest rates. So as interest rates have gone, gone up over the last couple years, there's been more of a squeeze on cost of living relative to the us so these are just to a certain degree, like harder markets. So being like just consumers at large are more price conscious. So I think it can go a long way.
- [86:47]
Cody
Now, do you get any, any customer feedback, any. Any issues with testing, pricing or. That's just kind of like in people's head and you know that people are going to be mad by seeing different pricing or you don't see anything.
- [87:01]
Cam
I didn't hear anything about it on this last test. I remember getting a couple points of feedback in years past, but ultimately it is such a massive net benefit to the business, you just got to bite the bullet and like, what matters is like the next hundred million impressions that you're going to serve and not necessarily like the handful of people who will have noticed some price change because they were like switching devices in this couple week period or something.
- [87:25]
Connor McDonald
Totally with you. That's a wrap on this episode of the Marketing Operators Podcast. Thank you again for tuning in and thank you again to our sponsors, Motion, Prescient, Rich Panel and House. As always, like, subscribe, comment your questions and make sure to share this podcast if you're enjoying it. Thanks again.