E065: Using Spending Power to Plan and Spend Smarter with Steve Rekuc - Plus AI Ads and PDP

Summary

Marketing Operators Episode E065 Summary: Using Spending Power to Plan and Spend Smarter with Steve Rekuc - Plus AI Ads and PDP

Release Date: June 24, 2025

In Episode 65 of Marketing Operators, hosts Connor Rolain, Connor MacDonald, and Cody Plofker delve into the intricate world of marketing analytics, spending power, and the evolving role of AI in advertising. The episode features a special guest appearance by Steve Rekuc from Common Thread Collective, who shares valuable insights on leveraging spending power to optimize marketing strategies. Additionally, the hosts discuss the latest advancements in AI-generated ads and their ongoing Product Detail Page (PDP) testing efforts.

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1. Analytics Reporting and Year-over-Year Adjustments

Cody Plofker opens the discussion by addressing a significant update in analytics reporting, emphasizing the importance of adjusting for the day of the week in year-over-year (YoY) comparisons. He highlights the challenges marketers face when comparing sales data across different days due to events like Father's Day:

"[03:21] Cody: ...we're comparing today’s sales versus last year, you're comparing yourself to one, a Sunday and two, Father’s Day."

This adjustment ensures more accurate comparisons by aligning similar days and events, thereby eliminating skewed data that can misrepresent performance metrics.

Despite hopes for a notable analytics tool to support this functionality, Cody reveals that Shopify is in the process of rolling out day-based YoY reporting, a development he eagerly anticipates:

"[03:46] Cody: ...Shopify seems to be rolling out day based, year over year reporting, which I could not be more excited about."

However, Steve Rekuc expresses some skepticism, noting that not all platforms may adopt this feature promptly:

"[04:27] Steve Racook: ...that's actually not quite true... Maybe it's just a prank from David."

The hosts collectively acknowledge the critical need for such granular reporting as a standard feature, ensuring consistency and accuracy in performance evaluations.

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2. Leveraging Data Warehousing for Enhanced Analytics

The conversation shifts towards the adoption of data warehousing solutions to centralize and streamline data from various channels. Cody shares his team's transition from cumbersome Google Sheets to a more robust data warehouse, enhancing accuracy in tracking revenue and cost of goods sold (COGS):

"[07:26] Cody: ...moving out of that into the data warehouse and that is just going to be slightly more accurate."

Steve Rekuc adds that integrating data from multiple sources like Amazon, TikTok Shops, and others is becoming increasingly essential for larger brands operating across diverse platforms:

"[12:08] Cody: ...larger brands you're just going to need to aggregate more and more places..."

Both hosts agree that while Shopify may eventually integrate with advanced tools like ChatGPT, the bespoke nature of many brands' data needs will continue to necessitate the use of data warehouses for tailored analytics solutions.

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3. Guest Segment: Steve Rekuc on Spending Power Metrics

Halfway through the episode, Steve Rekuc joins the conversation to discuss the Direct-to-Consumer Confidence Index (D2CCI) and the innovative Spending Power metric developed by Common Thread Collective. Steve explains the genesis of their spending power analysis, aimed at providing brands with actionable insights beyond traditional consumer confidence indices:

"[27:57] Steve Racook:...with like Covid being a huge outlier... we realized that we're not correlated to what is going on with that confidence index in those sort of situations."

By conducting regular surveys through No Commerce and analyzing spend versus Marketing Efficiency Ratio (MER), Steve and his team have crafted a dynamic model that adjusts for seasonal variations and economic indicators. This model helps brands predict how scaling their ad spend may impact efficiency:

"[34:38] Steve Racook: ...developing curves to see how quickly they're degrading efficiency by increasing their spend."

He further elaborates on the implications of their findings, such as a predicted 9% decrease in spending power for June compared to the previous year, offering brands critical context for budget allocation and strategic planning:

"[45:18] Steve Racook: The thing we do is to kind of predict... we're looking at June and the beginning of July. I'll look at July but I'm going to see if it can carry out a little bit further."

Cody underscores the value of this metric, especially when navigating unpredictable market conditions, allowing brands to make informed decisions rather than relying solely on anecdotal evidence:

"[49:12] Steve Racook: ...strip ourselves of accountability, the better."

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4. AI-Generated Ads and Creative Strategies

Returning to AI's role in marketing, the hosts discuss the effectiveness of AI-generated content in advertising campaigns. Cody shares his experiences with tools like VO3, which generate visual content for ads. While some AI-generated ads, such as the Father's Day baby ad, failed to scale effectively, others showed promise:

"[21:19] Steve Racook: ...the AI generated baby ad for Father's Day did not become a top performer, did not scale."

Steve Rekuc describes experimenting with AI-generated visuals, including imaginative scenarios like a farmer in an inflatable pool discussing egg prices, demonstrating the creative potential yet unpredictability of AI in ad performance:

"[20:14] Cody: ...a farmer in a inflatable swimming pool with eggs floating around him..."

The hosts acknowledge the challenges of integrating AI-generated content seamlessly into marketing strategies, emphasizing the importance of iterative testing and creative experimentation:

"[22:05] Steve Racook: ...AI generated content is at the point where you can at least be creating pieces of content that you can then be creative with."

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5. Product Detail Page (PDP) Testing and Optimization

A significant portion of the episode focuses on PDP testing. Steve Rekuc shares his team's ongoing efforts to revamp their PDP to improve user experience and conversion rates. The process involved numerous A/B tests, collaboration with external agencies, and the development of a comprehensive design system:

"[53:10] Steve Racook: ...constantly A/B testing... trying to learn from it and... took way too long to get there."

Despite meticulous testing and redesigns aimed at enhancing visual hierarchy, shade selection, and content richness, the early results indicated a temporary dip in performance:

"[59:23] Cody: ...you're okay. How's it looking? [Steve]: We're down so far but... it's early worth looking so I shouldn't even have looked."

The discussion highlights the complexities of e-commerce optimization, where even well-intentioned changes can yield unexpected outcomes. Both hosts reflect on the importance of resilience and continuous improvement in the face of such challenges:

"[60:09] Cody: ...it was a brutally testing period... but it's so important to keep pushing forward."

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6. Predictions and Market Trends

Towards the episode's conclusion, the hosts touch upon broader market predictions and trends. They reflect on past predictions made at the episode's outset, with an emphasis on the fading of "app love" and the rapid adoption of consumer-facing AI-powered e-commerce tools:

"[16:18] Steve Racook: I think I feel good."
"[16:24] Cody: ...consumer facing AI powered Ecom tools get traction."

The conversation underscores the dynamic nature of the e-commerce landscape, where adaptability and data-driven strategies are paramount for sustained growth.

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Conclusion

Episode E065 of Marketing Operators offers a deep dive into advanced marketing analytics, the significance of spending power metrics, and the evolving integration of AI in advertising. Through candid discussions and expert insights from Steve Rekuc, listeners gain a nuanced understanding of how to navigate complex market conditions, optimize marketing spend, and leverage innovative tools to drive business growth. The episode serves as a valuable resource for marketing professionals seeking to enhance their strategies in an ever-changing digital landscape.

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Notable Quotes:

• "Every operator I talk to is thinking about how to build lean teams and become more efficient and AI is an obvious part of this." — Connor [00:54]

• "If you're just opening up Shopify, comparing today's sales versus last year, you're comparing yourself to one, a Sunday and two, Father's Day." — Cody [03:21]

• "We're at an all-time high of 96% customer satisfaction score." — Cody [01:30]

• "Consumer confidence and spending will begin to rise back in most markets." — Steve [22:47]

• "Consumer confidence that’s published by University of Michigan or the Conference Board doesn't necessarily correlate back to something that you can measure." — Steve [28:17]

• "Having it in one place is essential." — Steve [12:44]

• "Incrementality testing is the best way to figure out what's actually moving the needle." — Connor [Time Not Specified]

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This comprehensive summary encapsulates the episode's core discussions, providing actionable insights and expert perspectives for marketers aiming to refine their strategies in the digital age.

Transcript

[Cody]

All right, we are back. Episode 65 or so of Marketing operators. Thanks for joining. It's just Cody and I today. Connor Rollings out. We've got Steve Racook coming on later, so he'll be on for like 30 minutes. So we'll get a guest halfway through. It'll be a fun episode. Before we get any further, I wanted to thank our sponsors Motion Rich panel after Cell Prescient and.

[Connor]

Okay, I just sent my entire team an email about this training that Motion's putting on and you guys are going to block your calendars for this. Every operator I talk to is thinking about how to build lean teams and become more efficient and AI is an obvious part of this. We talk about it on the Marketing operators all the time because it can automate time consuming parts of the creative strategy process. And Motion, our sponsor, they're doing a live virtual event series with five sessions on how to adapt timeless advertising principles to the new era of AI first ad production. This is their legendary virtual event series Make Ads that Convert. Last year over 11,000 DTC marketers registered for it and it is going to be a banger. Listen to these topics in just an elite cast of the best of the best experts. You'll hear from names like Alex Cooper, Jimmy Slagle, Jacob Pacelle, Dara Denny, Kelly Rocklin, Mirella Crespi and Barry Hot A few of the topics that they're going to go over. Using AI for deep customer research Advanced prompting techniques for ads that don't look AI generated Making sure your AI ads actually sell physical products Using AI actors and voice models for scalable UGC building a lean AI augmented team of 2025 here's one session that really caught my eye. It features Kelly Rocklin and she is going deep into using AI to make scalable UGC with AI actors and voiceovers without it sounding cringe. How to spin up high volume messaging tests using AI agents Super interested in what she's learned here. Expand on what already works without replacing the human spark that makes it work in the first place. How to test creative like a craftsperson, not a chaos agent. How to build internal creative testing systems for your AI creative, just to name a few. It's going to be really really good. Highly recommend registering. If you want to check it out, go register for this. It's free and it's five total sessions. You can register at motion app.com forward/make ads-that-convert that is motionapp.com forward/make-ads-that-convert.

[Cody]

The big update. Unfortunately Connor Rowling's not here to celebrate with us, but we've all been on our soapbox about, about a certain type of analytics reporting and, like, a really in the weeds topic that we're seeing some traction on. So I think this was a part of my new year prediction.

[Steve Racook]

I believe it was.

[Cody]

I believe it was. Yeah. No, that was a rhetorical question.

[Steve Racook]

Stephen a. Smith.

[Cody]

Yeah, 100% I care. I have. I've. I've grown, like, OCD about our reporting. And one of the things that very few analytics platforms support that I think is super important is adjusting for day of week, year over year. And like, today's a great example. It's June 16, June 16, last year. If you're just opening up Shopify, comparing today's sales versus last year, you're comparing yourself to one, a Sunday and two, Father.

[Connor]

Father's Day.

[Cody]

So it's like, that's. That's a terrible comp. What you want to be comparing is the Monday after Father's Day. And finally, I've been on my soapbox about it for six months. My New Year's prediction was that a analytics tool. And I should have. I should have held myself to a higher standard here I was hoping a notable analytics tool would begin supporting that. And our friend David tweeted at us. I haven't gotten it in my account yet, but Shopify seems to be rolling out day based, year over year reporting, which I could not be more excited about. I feel like it's maybe one of our larger accomplishments as a podcast.

[Steve Racook]

I don't have it.

That's.

That's the best part is that, like, you talked about it and you don't have it.

[Cody]

Yeah. Yeah. And maybe it's just a prank from David. Maybe he's just. Maybe he just photoshopped it to get me super excited. Yeah, dude. I mean, yeah, it's. It's bothersome. I look at. Do you look at, like, are you doing intraday year over year reporting at all? Like, do you ever look it up, like, oh, how are we pacing today versus last year? Or am I just like two in the weeds?

[Steve Racook]

Only like big promo periods, right? Like. Like a Black Friday or something like that?

[Cody]

No, I do it every day.

[Steve Racook]

You do? Every day? You don't think that's overkill?

[Cody]

No. Well, it's for sure overkill. That's actually not quite true.

[Steve Racook]

I've.

[Cody]

I've probably been doing it way more because we're just coming out of Father's Day right now, but I bet it'll slow down by the end of the month or July. But we, I do it quite often just to, just to kind of understand how is the, how is the, the day shaping up compared to this time last year?

[Steve Racook]

Now I get why you need this reporting so badly, dude, 100%. Because if I was doing that all of the time and it was just default on like same day last year, then that would also kill me. So I get it because I, I, I, I will say I'm super happy for you and I'm super happy for us. And I will, I will take this win as a win for one of us is a win for all of us.

[Cody]

Totally.

[Steve Racook]

I don't have the same compulsion that I need this that badly.

[Cody]

Everybody. The, the thing is. So I totally understand you not like feeling the compulsion to have this. It should just be the default. There's no reason for it to not be the default. I can understand not caring about like the, the year over the daily year over year reporting that granularly, but there's just no, there's no upside to doing it purely year over year. I think you're just introducing inconsistencies in the comp.

[Steve Racook]

Yeah, for, for sure. Unless you're looking like, longer, you know, longer time period. If, if, yeah, you zoom out. But yeah, otherwise. Yeah. So how do you feel about what they called it? I think in David's tweet, he called it. Obviously we don't know. We don't have it in ours yet. Not bitter or anything, but previous year match day of week. Is that what you would have called it? What have you been calling it prior to that?

[Cody]

That's fine. Ironically, I think who does it best is GA4. That's how I think that's how they phrase it. And they've got, they can do it year over year and then also you can compare the same day week over week, which you're a big anti week over week guy. But they'll be like, you could look at yesterday and then compare it to the same. Same period the previous week.

[Steve Racook]

Yeah.

[Cody]

And then you could do. I think within ga, you could do like week to date and then compare to the previous week or the previous year, which Shopify will get there one day.

[Steve Racook]

I'm not, I'm, I'm, I'm definitely not anti. Like, I just look at against forecast way more. The thing that always gets me. Shopify does a good job of this. When you pick like last seven in. In any analytics tool and they include today, that kills me.

[Cody]

Okay. All right, dude. That's the next Mission.

[Steve Racook]

I think Shopify does it pretty well. But yeah, that's, that's next one. How, how often do you use Shopify? Like, obviously you guys have Data Warehouse. You got. I know you guys have like your growth dash NORD theme. How often are you using Shopify analytics? Like, are you in there daily?

[Cody]

It's funny. You, you. Well, the thing is we'll do it for. We're like kind of ramping up our data warehouse now. So like our first, our first project with the data warehouse was just to get all revenue from all of our channels and all of our ads been properly categorized so we'd move out of. We have this really big monstrous Google sheet that we use, which I love and it's been a labor of, a labor of love for like the last six and a half years or whatever. But we're moving out of that into the data warehouse and that is just going to be slightly more accurate. We're going to get slightly more accurate variable costs. We'll get accurate cogs on a daily basis which weren't getting calculated within the daily growth dashboard. So that's where the focus has been, where Shopify is the most helpful right now. Shopify analytics is anything product related. So if I want to look at like sales of a certain SKU yesterday, Shopify still the best source of truth as well as if I want to look at revenue today, Shopify is the.

[Steve Racook]

Best for that for sure. I agree with you. I think Data Warehouse one would be an interesting POD topic. We've got one. I know. Connor hexcloud, they're using Hexcloud as. Connor hexcloud, they're using Saris as well. I feel like that could be a pretty interesting one. The funny thing is, so we have Data Warehouse. The first thing we did when we hooked it up, I was like, I need to use our data warehouse to pipe data into the spreadsheet. They're like, why would you want to do that? I'm like, I need it. This is what we use every day. Get me my data in the sheet. So, so it's like it's coming from the data warehouse, which means it's accurate and right. Whatever connectors we had previously look just like we're using Funnel, which is like a super metrics thing prior to it and like just broke pretty much at our, at our volumes. Like we broke it one Black Friday and it just never worked again after that.

[Cody]

Yeah, no, totally. I, dude, I, I get it. I mean there's just a, there's a certain. Just Being able to work in pivot tables is in my comfort zone.

[Steve Racook]

You know, I'm not good at that, but I like spreadsheets.

[Cody]

Fair enough.

[Steve Racook]

I will say though, by the way, on Shopify analytics, I am using it more because of Sidekick. I am definitely in there using it more often.

[Cody]

What have you been doing?

[Steve Racook]

So my data analyst is about to have a baby, a second baby. So I'm like, hey, you know what? Let me things I used to go to him for, let me see if I can do it. So just like small stuff frequently bought together is a cool one, is an easy one.

[Cody]

Awesome.

[Steve Racook]

Here's another one I was thinking about and showed my VP Retail today. The first thing I did when we hired a data analyst maybe a year ago was hey, I need to know when we open a store in a region, how does our online sales and traffic look? Just like I don't know SQL, you need to do that now. I can upload. You can upload files into Sidekick. I can upload or just even tell Sidekick the day that we opened any store and do like a pre and post look back on online sales and traffic and those.

[Cody]

Oh dude, awesome. And it did that pretty well.

[Steve Racook]

I haven't done it yet. I haven't. I haven't done that part. I've done the frequently brought together, which that's a. Which is pretty good.

[Cody]

That's a good one. And frequently bought together I think is tricky. I think basket analysis within Shopify is like surprisingly difficult to do. That was actually what I was going to list as moving to the data warehouse. That's something that we currently didn't have nearly as much like real time insight into as I would have liked. We'd only pull data from like snapshots of time and do basket analysis post hoc when in reality I'd love to have like an automated weekly report of like what was it last week? How is it changing things like that? So we've got the data warehouse but it sounds like maybe Sidekick will do it.

[Steve Racook]

Yeah, it's cool. I think I'm trying to decide because there would be so much valuable to have other data in there and I feel like Shopify will know that like you don't have your spend data in Shopify, stuff like that.

[Cody]

Right.

[Steve Racook]

I'm trying to decide and guess maybe this is one of our predictions. What I think is more likely does Shopify integrate with those other things and allow you to pull more data into Shopify and use Sidekick or does Shopify integrate with ChatGPT and like rather than pulling it in almost push Shopify data out. What do you think is more likely?

[Cody]

Yeah, I think it's a great question. It's probably more likely that Shopify integrates with ChatGPT is my first thought. I actually think for larger brands though, this data warehouse step is just going to get more and more popular for a couple reasons. One, for larger brands you're just going to become more and more multi channel over time. So you're going to need to pipe in from Amazon or from different retail accounts from Shopify, from different, you know, TikTok shops, whatever, like all that stuff, I guess TikTok shop pipe. TikTok shop pipes through Shopify. But point being, you're going to need to aggregate more and more places that like won't always get supported by Shopify or Chat GPT. So you're going to need this like middleware essentially. And then the second one is, I think so we do a lot of, is like we have a pretty large like product taxonomy. Like we're tagging things by category or silhouette or collection or whether it's license or not, etc. And like where does all that information live? Like you could argue that it should live in, it could live in metafields within Shopify and then maybe Sidekick could use it. But again then you're talking about, well, how do you get that information attached to your Amazon sales? So I think in the case that you described, my gut says Shopify probably integrates with Chat GPT and maybe it gets a little bit more powerful. But middleware data warehouse, where you load in even more data and then you can format it and clean it in all the ways that align with the way that you think about the business. And then you're querying on top of that. I think that's the, the end state.

[Steve Racook]

Totally agree. Having it in one place is essential. Yeah, no, I just think about. Cause I saw that ChatGPT now integrates with HubSpot, which was a pretty big one. And I feel like it's only a matter of time where one of those things with Shopify is happening. But I also wonder if like they also integrate, you know, obviously they integrate with Google Drive, they integrate with like OneNote, like whatever the Microsoft version is and you can have like SharePoint in there. So we have a lot of our finance stuff in there. So I'll play around with that. But I feel like it's also only a matter of time where like they, maybe they wouldn't because it's, you know, like what Snowflake? I don't know what your guys warehouse is on but we're on data Snowflake for a data warehouse. Like I feel like it's only a matter of time before they're integrated with there as well. Right. And then that almost like cuts out the bi tool layer and like you just, you just have chat tbt. I don't know but I think that'll be cool.

[Cody]

Yeah, yeah, yeah. I'm super, I'm super curious to see how it all comes together. But I've said it multiple times on the show. I think the SaaS platforms that have large unique data sets, I wouldn't even say large, but just valuable unique data sets are well positioned to like just bolt on some sort of LLM Shopify. I've always put in that bucket and I just think the data warehouse piece is like there will always be enough kind of bespoke. Not always. For many brands there will be bespoke stuff that you need to do that will just not get supported within the Shopify like ecosystem. So we'll find these like alternatives with the data warehouse. So I don't really know.

[Steve Racook]

Yeah, yeah. And, and I've heard Harley say that on podcasts like they, they can't, it's not feasible for them to build for everybody and they're not really building for you and I. They're building for, you know, the, the, the, the 99% of brands, like most, most new brands, total features we need. But they did listen, they did throw us a bone. I'm gonna, you should take all the credit by the way, for this.

[Cody]

Oh, with the reporting. Yeah, yeah, absolutely. Dude. I was like, I was DMing the VP of Product. I was like dude, you gotta, you should really think about doing this. It's been a year since we migrated to rich panel and I had no idea how impactful the right customer service tool could be. Here's what our customer service team has achieved since making the move. One, Our order volume continues to rise but our support tickets, if not our self Service portal helps 47% of website visitors help themselves immediately without having to contact our agents. 2. Their AI powered social media moderator is awesome. We continue to spend a ton on meta as a part of our marketing mix and it flags and replies to thousands of comments automatically to help us make the most of our ad spend. Like many of you, I've been cautiously skeptical about certain automation and AI use cases, but our support quality hasn't dipped at all. It's actually gone up. We're at an all time high of 96% customer satisfaction score. All this and it's still 50% cheaper than other platforms. No limits on AI usage or tickets and fair predictable pricing each month. With market and tariff uncertainty, consumer confidence is in the gutter. You cannot afford bad customer experience or overpaying for older software tools. And migration is super simple. They handle your data, import agent training and automation setup. You only need two or three calls and you're live in 14 days. They guarantee a 30% ticket reduction in the first 60 days or your money back. So it's a no brainer. If you want happier customers and a happier finance team, head over to richpanel.comdemo to book a demo today. No, we had some good predictions. Let me we had a couple minutes and then and then Steve jumps on we I've got a couple pulled up. I I I dumped our YouTube transcript into Claude and it summarized it. We mostly talked about your predictions. One App Love and Hype will fade. We're six months into the year. Do you feel good about that one?

[Steve Racook]

What do you think?

[Cody]

Dude?

[Steve Racook]

I think I feel good.

[Cody]

Hype will Fade. It was a layup, frankly. Like it could only have faded.

[Steve Racook]

I called it at the peak.

[Cody]

Yeah yeah, yeah, yeah. Y was like app love and hysteria and you were like I think it'll be I think we'll be less excited about it.

[Steve Racook]

I'm like Michael burning like one like what, what are you calling 11 of the last one recessions or something like that?

[Cody]

Yeah, yeah, 100%. That was easy. Claude says this was mine. I don't remember this. Consumer facing AI powered Ecom tools get traction Also a layup I would say if you had told me in we did we recorded this episode in January. If you had told me in June that people would be running fully made AI video on during the NBA playoffs, I would not have believed you. So we have seen like an incredibly quick escalation of the quality. So I'll I get that one. But like I was so I was calling such an obvious trend upwards that I'll actually I'll give the caveat that I wouldn't have expected it to be where it's at today.

[Steve Racook]

Okay.

[Cody]

Did you see the the call she.

[Steve Racook]

Had just before this? I heard people talking about it but I hadn't watched it. So you put it in the show notes. So just watched it and pretty wild.

[Cody]

Yeah. So we could put in the show notes for everybody because I didn't feel like it really cracked into ddc d2c Twitter. I've talked about Kalshee before. Kalshee is a betting platform in the US I think they do incredibly good marketing. I think they do incredibly good marketing. I won't get, I won't, I won't go too far down the rabbit hole.

[Steve Racook]

Who's better, them or Chloe?

[Cody]

Oh.

[Steve Racook]

You like how I dropped that with, with Ioana? Because Conor Roland would have no idea.

[Cody]

No, no, no, no. There'd be so much, there'd be so much context to have to give here. K For those listening is this YC backed startup and the founder is crazy. And basically we're in this period of time where like particularly SaaS founders are just really good at going viral. And I think they understand that. I think they understand that just getting the eyeballs is so much more valuable than any sort of like negative connotations it could be attaching themselves to or any sort of negative press. The cluey founder had. Like there was like a quote unquote leaked photo of like a stripper on his lap or something. But like, but that's, that's the sort of idea where like, I don't even. It wasn't one of their better marketing stunts. They've had some, some more clever ones. But just the idea like, hey, we're going to get 400,000 impressions on this tweet by doing this thing up, being a net benefit despite people being like, this guy's unserious, he shouldn't be running a company, nets out positive for them. So the call sheet thing, to go back a little bit, they did a full VO3 generated ad about their betting platform. And the punchline of the ad is the world's gone crazy bet on it or something. It's like, something like that. And it's just these like little vignettes, like three, four second clips, whatever VO3 generates, but just kind of pieced together. And there's people doing crazy stuff. At one point there's a farmer in a inflatable swimming pool with eggs floating around him and they're just asking him how much he thinks eggs will be in a couple months and he's like $9 an egg or something. So it is this absurd ad, all AI generated. And what I loved about the, the marketing rollout of it was that they ran it during the NBA playoffs last week and then they had a very concerted social strategy talking about not only them doing it, but how they did it. And I just thought it was like a fantastic way of like one, taking advantage of a, of like the meta right now with AI generated ads. Two, I think it's A great thing to play during the NBA playoffs. It totally aligns with, like, them as a betting platform. And then three, having the dedicated social strategy, talking about how they did it. I just thought it was, like, incredibly well done.

[Steve Racook]

I. I gotta check out some of that. Yeah, the ad is. Is crazy. Have you guys done any VO? How do you say, is it VO3, just VO as part of your creative strategy yet?

[Cody]

I think it's. I think it's VO3. The one that we had running in the account. We generated a. A hook. So just like the. The first three seconds of one of our luggage ads of somebody with a chainsaw sawing through, like, an, like, a fabric piece of luggage, and there's, like, clothes, like, spilling out of it. And it's pre. We talked about this a little bit at the Meta Summit a couple weeks ago. We're generating quite a bit of AI content at this point. We had another one from Chat GPT of like, an old billfold that was on fire, and we, like, then we generate that asset there, and then we're editing it in Photoshop. We have the V3 example with the chainsaw luggage. And then. I don't know if we've talked about it. Well, we did the AI generated baby ad for Father's Day.

[Connor]

We.

[Cody]

It did not become a top performer, did not scale.

[Steve Racook]

All right. It's not. Sometimes it's just about the art, you know, dude, 100. Yeah, I'm gonna. I saw an ad that I was reviewing the other day for my team, and it was talking about, like, cakey makeup. And so I had somebody for a hook, like, non UGC ad, like, stick their head in a cake. And I was like, if this works, we're going VO3 and just, like, getting as many, like, cake, you know, hooks as we can.

[Cody]

Dude, totally.

[Steve Racook]

I'm gonna try it.

[Cody]

That's the sort of thing just being super creative.

[Steve Racook]

It's still.

[Cody]

The call she had is interesting because it's completely AI generated and then ran during the NBA playoffs, which I think is really cool. Doing it on linear TV for the majority of brands. It does feel like AI generated content is at the point where you can at least be creating pieces of content that you can, like, be then creative with.

[Steve Racook]

Yeah. And icon, you can. Then. I totally agree with that. In icon, you can, like, upload and an image of a person and have the. Have turn that into an avatar. Oh, cool. I was playing around with it. I'm teaching this, like, AI in service to my team tomorrow at our all hands. So I put My daughter, my top, my two and a half year old daughter in it. Just, just to see. It's just like it was like the closest picture I had because like that's what's on my phone. The funniest, like, yeah, it's like clearly AI but like very, very funny and impressive. So yeah, it's, it's cool. It's funny, dude.

[Cody]

Awesome. All right, cool. So we got, we got Steve rook jumping on in a second from Common Thread Collective. Have you been following their. The DTC index or the D2CCI or anything like that from them?

[Steve Racook]

Can I say one thing before we turn gears?

[Cody]

Of course.

[Steve Racook]

I think we should do a predictions episode. I'm reading through some of my tweets that I found pretty spot on on a bunch of them. I think we did great. Hilariously wrong on number seven. Oh. Consumer confidence and spending will begin to rise back in most markets.

[Cody]

You don't feel like that's the case?

[Steve Racook]

No. At least not in like beauty and luxury, ironically.

[Cody]

Steve will be able to tell us. I mean that's like basically what he's tracking. There's a fantastic segue.

[Steve Racook]

Yeah, I've seen, I've seen they've done a really good job as always, C to C, like tweeting about it, creating content about it. So definitely have seen and always try to track. So it's cool. But excited to see chat about his updates. I think you've gone a little bit deeper with it than I have.

[Cody]

Yeah, 100%. So you think going back to your prediction, you think consumer confidence would return? You don't feel it has to at least beauty. I think that's, that's clear. Do you think that's true of the E comm industry at large? Is that like what you're hearing from other brands as well?

[Steve Racook]

Yeah, it's so hard because it's, it's so subjective. You know, it's just like, like when people reach out and text you and they're like, hey, how's performance like for you? Like that's when you know it's bad. But, but it seems like it's. Yeah, seems like it's still not quite there, but definitely some verticals seem to be doing really well. So who knows?

[Cody]

I got, I got a couple that. I mean honestly, we need, we need some sort of tracker for text about performance between like brand owners. Like just kind of like like a Bloomberg style terminal of, of like what people are chatting about because yeah, I had two people reach out to me say that they thought father's Day was softer than they expected. We had a fine Father's Day. It was like I was describing as them as really okay and and honestly like those three data points are super to contextualize performance where it's like hey look, we feel like we're doing really okay. I've heard from other people that it's soft for them. So you just like ultimately it's those anecdotal or like that qualitative data that I think is super valuable and is like impossible to come by if you don't have something like the DDCI or a group chat full of other brand owners. Like it's really difficult to understand what winning or losing looks like at any given time.

[Steve Racook]

Yeah. And then especially if you're trying to get like within a vertical. Like I don't know if you talk to anyone that's like in a similar space but like let's say I see somebody of the meta summer. If I'm talking to sh. Like I'm going to, I'm not going to be honest about it. I'm like yeah, we're crushing it, you know, so it's like very hard to get it, especially if I'm talking to Shereen by the way. But it's like very hard to get like a very accurate read of like within your actual market, you know.

[Cody]

Totally. If you're listening to this podcast, I know that you're working hard to drive revenue with upsells and across your ecom site generally. But if you're not monetizing your post purchase experience, you're leaving easy profit on the table. Most brands and everyone listening are optimizing the transaction journey. But stopping at the thank you page and that is a big mistake. After Sell is changing that. We've been using their Rock thanks feature at Ridge and it's a no brainer for us. Here's how it works. You show premium non competing offers from brands like Disney and HelloFresh on your order confirmation page. AI driven personalization picks the best offer from hundreds of reputable advertisers. And brands like True Classic, Blendjet and Jones Road Beauty are already using it, seeing 30 to 70 cents lift per order. No disruption, no fees, just extra cash in the bank. And the numbers speak for themselves. After sale customers generate 20 to $30,000 in pure profit per 100,000 orders. There's a 16% average engagement rate which is way better than traditional ads. And it's a new revenue stream without disrupting the checkout. It's an easy win and it's completely Free to try. Plus After Sale is hooking up marketing operators, listeners because you can sign up today and you get their entire upselling suite for a year, which we also use very heavily. So visit after sale.com operators to try rock thanks. And see the money rolling in. Stop leaving money on the table. Turn your thank you page into more revenue with After Sell. All right guys, so we're going to pivot a little bit. We've got Steve Rook here from Common Thread Collective, the master of D2CCI. He's going to break down what that means. He's sharing the absolute best data on Twitter every single week. So Steve, thanks for jumping on.

[Steve Racook]

Yeah, thanks Connor. I appreciate it. Thanks for having me. So yes, I'm director of data at Common Thread Collective and I look at a lot of the both brand data for modeling, for modeling the spend versus AME R and like the consumer confidence index that we kind of compile in conjunction with no Commerce. So they do the survey and we kind of have the data to match that up against. So it lends itself really important to the modeling because we've noticed back in the day that when the consumer confidence published by University of Michigan or the Conference Board wound up being low, we struggled. Our MER was lower than we had anticipated for those months. So kind of became important and Taylor kind of tasked me out to see if we could figure out a way to do our own consumer confidence.

[Cody]

And that's. And when, when was that? I think you guys are. It's. It's gotta be almost two years or so.

[Steve Racook]

Yeah, yeah, it was actually. Well, we first started looking at it almost three years ago. We noticed MER was correlated to consumer confidence. I had a pretty good correlation at that point in time. And then we got in touch with no Commerce about like 2 and a half years ago and started collecting survey data in March of 23.

[Cody]

So. And then. So for those maybe. Maybe some people aren't familiar with no post purchase tool that a lot of brands use. And then how are they collecting additional data? And, and how does it serve as like an alternative to the more commonly known consumer confidence?

[Steve Racook]

Yeah, so. Well, our idea was we wanted a little bit more responsive and, and I want it tied to a metric that tells me if it's true or false or how what percent off it is because the consumer confidence that's published by University of Michigan or Conference Board or o. OECD doesn't necessarily correlate back to something that you can measure. Like I don't know if what they said was true right to any extent. So I wanted something to kind of pull it back to. And no Commerce offered the opportunity to kind of get the survey data. So we have an opportunity to kind of do more surveys because we're not calling people on the telephone. Like those old consumer confidence. So they go ahead.

[Cody]

I was gonna ask what questions. Does. Does no ask.

[Steve Racook]

Yeah, so we. Sorry. Five, seven. Five questions. Do you think the economy will be better or worse in the future? Are you spending more or less online this month? Do you anticipate spending more or less online in the next three months? Do you enjoy the value of saving or spending your money? What's more kind of a priority there? And do you generally purchase direct from a website or from a marketplace such as Amazon or Temu and kind of. We also have a little bit of data from no Commerce as well on the AOV that each order has as well as like state specific for shipping. So we're kind of able to break it down and look at different segments in different ways.

[Cody]

Yeah, 100%. Awesome. So you're getting all this like relatively real time data from consumers via. Oh, and how many, like, I imagine it's thousands of people that are. That are answering those questions every month. Do you have. Do you have a rough number?

[Steve Racook]

Between one and two thousand a week.

[Cody]

So one in two thousand a week. All right.

[Steve Racook]

Yeah. So like Black Friday, Cyber Monday where we had so many more purchases. So we're up over 2000 and then slower weeks, we're down around a thousand.

[Cody]

Totally. Yeah. So you're getting all this like relatively real time data from consumers. You're able to map that against like the massive data set that that common thread collective has. And we're, we're approaching the spending power that you were tweeting about this week. But I want to jump back quickly. You said you guys started looking at it almost three years ago. And I think brands operating at that time were probably all in the same bucket. That was 2022 where like we're coming off of massive E Comm adoption during the pandemic. 2020, 2021, we're getting. Consumers are getting stimulus checks. They've got disposable income. They're not able to spend money on travel or eating out. So they're spending money on. On E Comm. It was like, awesome. And in 2022 that stops and everybody was like, at least from Ridge's perspective and Cody, I don't know, I think you guys were ripping in 2020 22. But for us, we were like, what the hell Happened like this is the Facebook ads are not making money the way that they used to. And we were like asking those same questions. It was around this time where like oh, gas prices were also like extremely high. And I remember plotting conversion rate against gas prices and it's like, obviously that's going to be like inversely correlated. If people are spending 6% of their income, 10% of their income, I forget the stat, but it's like a really large percentage of the average American of their income is being spent on gas. If more of that's going to drive into work every day, they're going to be less likely to purchase the hundred dollar minimalist wallets. And it seems like we were all asking very similar questions at the time and you guys built like a very elegant solution for better tracking and, and reporting on that. Well, thank you.

[Steve Racook]

We wound up down kind of a similar path. We were looking at gas prices, consumer price index, and then finally looked at consumer confidence. And that's what kind of led us down this road where it was like, oh man, this is kind of cool. We should build one of our own. Because this is not responsive and it's not necessarily tied to what's going on with our industry. And with like Covid being a huge outlier, like if we go further back in the data set to the time when everyone was doing extremely well in e Commerce in Q2 of 2020, the Consumer Confidence index was tanking at the time because all physical retail was in totally tailspin. So we, we realized that we're not correlated to what is going on with that confidence index in, in those sort of situations. We want one separate 100.

[Cody]

I love it. Cody, did you want to make any points here? Otherwise we could jump into the spending power stuff.

[Steve Racook]

Yeah, I can, I can tell. And I know that we were also struggling around the same time because I just pulled up my DMS with Taylor and went back aways March 8, 2022. I was like, have you guys ever modeled or looked at the, the correlation between like ROAS and the stock market? And because, because I think it was like right after you guys probably launched Statless. So I'm like, have you guys ever looked at and compared it? And he's like, no, but I'd be shocked. And I'm just like, so it's just funny. We had a conversation about it then. Obviously stock market was probably not right and way off. But I think that was what got me thinking about it because I think that was probably right when like the Ukraine war started and then Obviously people stopped spending, but it's. We were. We were also not ripping then. Connor.

[Cody]

Okay, so I sent Taylor a very similar thing, but it was September 2022. So you, you beat me to it. But yeah, as I mentioned, like, we were all, we were all asking ourselves, like, very similar things because we were all trying to better contextualize our performance. So anyway, I just think that's funny the way it's all come about.

[Steve Racook]

So I beat you to it, which means we were struggling more than you were before you.

[Cody]

Dude, our 2022 was brutal. I don't think you were struggling as much as we were, but not a contest.

[Steve Racook]

Yeah, yeah, certainly like our whole data set was struggling at that time.

[Cody]

Totally. Yeah. So cool. So, Steve, the reason, the reason I was super excited to have you on was because of the thread you had last week about spending power. So maybe you could just give like a high level overview of what problem you were trying to solve and kind of where you landed.

[Steve Racook]

Yeah, so it relates back to like the spend versus AME R models that I wound up doing for brands. I actually kind of come up with the spending power for them for each particular month. So we wind up developing curves to see how quickly they're degrading efficiency by increasing their spend. And that's something we do for every brand at Common Thread Collective, like even the accelerator brands. So then in developing that that actually relates, I thought it could relate to the entire data set that Common Thread Collective has. What if we can come up with a way of given this much money, this is how much AMER will decrease or how much additional spend will the whole data set decrease in efficiency? And I was able to map that out for our data set using like three years of data to see how this historically went. And obviously we see the same sort of peaks where November shoots up and December is fantastic as well. And then you kind of see a dip back down during lower times, October being a particular struggle as well as like some of the. The winter time as well.

[Cody]

Totally.

[Steve Racook]

So that led me to develop a curve then for all of it for any particular month that shows kind of the spending power. And there I show on that chart like the two maximums where like November 24th was like our highest spending power, essentially the furthest out you can get with AMER continuing to stay high even when you spent more. And then the lowest was actually just the month Prior October and 24, sorry, 23, I messed up that chart a little bit. It was actually the 23rd of November and the 23rd of October that were the two kind of maximum and minimum on that chart.

[Cody]

Totally. But the point being here you're finding a relationship between how much more you can spend and how quickly will Amer diminishing, correct?

[Steve Racook]

Yep, absolutely.

[Cody]

And then, and then I think you, you started what I thought was interesting. It's at the very beginning of the thread. But for May, amer came in 92 and a half percent. 92.5%. So below the average, correct?

[Steve Racook]

Yeah, it was below our average, but with above average spend. Like 120% of normal of average spend.

[Cody]

Right. Which brands? The average brand should be comfortable with Amer decreasing if you are able to scale up 21% above the average, right?

[Steve Racook]

Yes, exactly. And also assuming that you'd have decent returning customers as well, 100%.

[Connor]

I keep hearing the same things from people lately. I'm being asked to do more with less. I have big goals to hit, but my budget is tight and every marketing dollar needs to work harder. I know I'm hearing this at hexclad. I'm sure a lot of operators are hearing this at their brands. Super relevant right now. Incrementality testing is the best way to figure out what's actually moving the needle. So you can move around your ad spend in a way that's backed by science. All three of us use House for incrementality testing. We all love it. And House is now working with more than 40 of the top 100 DTC brands, which is pretty insane. I can speak personally for hexclad. The amount of insights that we've gotten, especially on our view based channels and how those are driving impacts and efficiency and revenue for our business is not only super valuable, but only possible through House. You know, channels like Connected TV, YouTube, TikTok, these very view based channels that don't garner a click. The same way that Facebook and Google does have been really only measurable through Geo incrementality holdout testing. And the actionable next steps from these tests in terms of deciding to scale up or down or keep spending where it's at is is really amazing. House helps you run experiments on your channel so you can confidently answer the questions you've always wondered about. Things like what channels are actually driving my business? How much should I be spending on each channel? What's the impact of my ads on Amazon or retail sales? How should I structure my Meta and Google accounts to make sure they're spending dollars in the right way? The beauty of House is that it's built for marketers. The science under the Hood is rigorous, but the platform itself is simple. So you pick a question, launch a test in minutes and get real results fast. Every customer is paired with a measurement strategist, someone who understands growth and brings a clear strategic point of view. They will get to know your business, help you build a roadmap of impactful tests and guide you as you operationalize incrementality in your day to day. Even if you're brand new to testing, you're not doing it alone. It is very much no in no way. Like go sign up for the platform and figure it out on your own. You have a partner in these customer success reps from House who's been in your shoes. And now more than ever, you need to make every marketing dollar count up. Level your measurement with House by going to house IO forward/formators, that's H A us.IO/operators and start allocating your budget with confidence.

[Cody]

Some of my main questions here. Cody, do you have any questions on this? You think we're doing a good job run it running through the definition of spending power here?

[Steve Racook]

Yeah, I think so. I think it's clear.

[Cody]

Awesome. Because a couple of my questions, one is how brands can can utilize this information. Like we're publishing it and we're able to understand theoretically that if we can spend more, we can accept diminishing returns and that in our ability to spend more changes throughout the year, this says I can spend more and have a slower diminishing return. In November, it's pretty good in May, it's really bad in October. So do you have a perspective on the average brand? They're following you on Twitter now. They're getting this information updates like how should they be thinking about this information?

[Steve Racook]

Yeah, so it will affect the economy in general. But you have to understand that there's like a lot of different verticals in this too. So some being far more seasonal than others. Whereas like we look at like supplements or car parts or healthcare type stuff that winds up being almost season, seasonally agnostic, where it's not that crazy a difference. Whereas if we look at something like paddle boards or kayaks drastically seasonal or skis drastically seasonal. So those sort of things, it's really going to depend partly on the brand. So what I would say is like see how closely it matches up with what you perceive as your performance. Now at CTC we, we have curves for all the brands in terms of spending power so we can see how they match up versus this overall spending power.

[Cody]

Totally. And you know what, what makes total sense is that some Brands are more seasonal than others. Right. Like, we're great gifting products. We. We just came off a really strong Father's Day. It was a really. Okay, is what I was just explaining to Cody. But like a big Father's day. Same with Q4, our wedding band business. We do really well in the fall as people prepare for fall weddings. We do well during Valentine's Day because I guess people are getting new rings around then. So there's like, obviously that. I guess what's harder to track for brands is variability not explained by seasonality. Like, and that's like, that's like the consumer confidence information that comes in, like, Father's Day, year over year. I know that it can be bigger. I know that we can spend more. But relative to, like, what are. What are consumers true spending powers? And is that better or worse year over year? And how should I, you know, adjust my strategy because of it? That's what we were saying right now. That is so anecdotal, and I don't know if there's a true solve for it other than being aware that you're not always operating in the same sort of environment from a. From a consumer spending perspective.

[Steve Racook]

Right, Absolutely. Well, we're trying to figure out a way to put a number on it and then to decipher that number down to the different verticals as well as individual brands. So I think the next thing for me to be doing would be to correlate this to specific brand performance and their spending power in any particular month, as well as different verticals. So, like, see if fashion and apparel or cosmetics and beauty have different kind of curves that go on at different times of year, they might be more impacted, more gifting in a way.

[Cody]

Yeah, 100% extremely cool. So is that kind of the. It felt to me like spending power? You said it at the beginning of the thread that you had been mapping things against Amer, but that doesn't take into account scale. So you came up with the spending power, like proxy. So what comes next? Is it verticalizing it? Like, if. If you extrapolate out, like six months, 12 months, like, are there more questions in this area that you're interest in solving?

[Steve Racook]

Yeah, I think I would be verticalizing it. I would be correlating it to individual brands so that we can see how it. How each of them perform. And right now I'm only predicting it one month in advance. Like, I'm looking at the beginning of June. I'm looking at June and the beginning of July. I'll look at July But I'm going to see if it can carry out a little bit further. Of course, I can tell you the seasonality, have some idea of the seasonality based upon CTC's historic data set. But factoring that surveys is going to get us a lot closer to the number, like, way closer to what the spending power would actually be for any particular month. So I'm going to try and see if that can carry one or two months out rather than just tell you, hey, this is what's happening this month.

[Cody]

Yeah. Okay. So. So that's actually what I was going to ask about. One of the questions that gets asked currently is, do you expect to spend more or less in the future? Yep. So are you saying that maybe with answers like that, you can predict the spending power of an upcoming period? That's what would be the most valuable to. To someone like Ridge. We, you know, it's May 10th. We're. We're a couple days out from kicking off our Father's Day sale. We're planning budgets. We have no information as to like, whether we should plan to grow year over year or whether the consumer's stronger year over year. We have our most recent performance. We could say, like I'll give you an example. We grew pretty significantly year over year during our anniversary sale in March. So we were like, okay, we feel relatively confident that we should be able to grow this coming Memorial Day and Father's Day. But having, like, being more scientific about that could be massively valuable because we've at least learned the lesson. We've tried to spend into periods where the spending power is not there. Right. Like the returns diminish quickly. And that's just such an expensive lesson to learn. So the more predictive information that we can get to better budget to better plan is like, seems massively valuable.

[Steve Racook]

Yeah. Thank you. That, that's the idea is to kind of predict. So I mean, I was taking the beginning of June with the close of May's data and trying to predict June's spending power and essentially seeing it being like around 9.3% less than last year.

[Cody]

Okay.

[Steve Racook]

See?

[Cody]

Not good.

[Steve Racook]

No, not good.

And just making sure I understand. This is taking both recent consumer confidence as well as seasonality into account for both to give you like an output for the next month.

Right, Correct. As well as stock market data. I pulled that in as well. I'm like, well, that's actually kind of pretty related.

See, was right after all.

[Cody]

Yeah, we use.

[Steve Racook]

I don't know if Stevie, you guys use this, but for our cohort forecast. We use like a seasonality multiplier for our cohort data because like when we forecast it out, we'll just take like an average retention right. Of like, you know, retention is like 14%. It's not average. Every, every 30 day cohort. Like no October cohort is going to be way more valuable because we have Black Friday after it. So we might have like a 1.5x seasonality multiplier. And for us in the summer we're, we're lower and so that's how we forecast our repeat customers. But I feel like this is almost a similar thing, at least on the seasonal side where it's almost like giving it a seasonality multiplier for your like efficiency and spending power. But then you're, you're layering on obviously like recency into it.

Yeah, exactly. We wind up doing the same thing with our cohort specific like LTV model for returning customer revenue where yeah. We take the seasonality multiplier times like our normal lift or add it to our normal lift where.

Yeah, yep.

[Cody]

To, to backtrack quickly. So you said using May's data, you're predicting that spending power will be 9% less in June year over year, correct? Yeah. And I guess the, it's that it's the delta year over year that's probably like there might be something seasonal about it. Like maybe it's not as warm so people aren't buying as many tank tops or something. But like it's probably actually a better indicator of non seasonal things that are contributing to consumer spending. Would you agree with that?

[Steve Racook]

Yes, absolutely. Yeah, that's probably what's going on and that's what I'll probably try and do in the future too would be to pull out the seasonal component and then the like a seasonal adjustment for what we're seeing. So that would probably be the better way to address it.

[Cody]

Yeah. Okay, so when did you publish that, that like that based on the data you think spending power will be 9% less in June?

[Steve Racook]

I kind of published it in the tweet, but not like really? I didn't explicitly come out and say it, but last year it was our June was 94% of like average spending power and then this year we were looking at 84.6. So it was like 93.4, something like that last year.

[Cody]

Yeah, yeah.

[Steve Racook]

So certainly it's seeing a drop of like 9.6%.

[Cody]

I think it was super, super interesting. Yeah, I'm like a total geek about stuff like this and I was just telling Cody before you jumped on, I'd gotten to. Yeah, I think this was before you jumped on. I got two texts from other founders for Father's Day saying it was softer than they expected. And like, that's the only. Without this 9% data point you just gave me, that's the only context that I have. We have. We've had a very okay Father's Day. And this is exactly the conversation we have internally. How do you feel about sales? I feel very okay about it. We're like, we're slightly growing, we're more efficient. And, you know, X person, Y person text me. They said their sales are soft too. Like, that is the best that I can really do. But then having the context of like, hey, Steve now says that spending power is actually down 9% year over year can also help contextualize, like, what does winning look like in this environment? And it does probably seem like moderate, more efficient growth is solid. And maybe I'm just, like, coping. Maybe I'm just. The more.

[Steve Racook]

The more reasons that we have to strip ourselves of accountability, the better. Yeah.

[Cody]

Yeah, 100%. I'm just. I'm picking out the data points that support my. My position.

[Steve Racook]

Right.

[Cody]

So that's why it was so important to have you on today, Steve. I was looking for more. Yeah.

[Steve Racook]

Just in case Sean is listening. Really? Yeah.

[Cody]

100 dude. He's a weekly listener. He'll hear this.

[Steve Racook]

Yeah, I hope he is. And. And hopefully it gives brand some, like some additional data in their. In their bag to. If they have to go up against investors to explain some of the tough times they might face because of this.

[Cody]

100%. Well, cool. I think this was super helpful. I suggest everybody listening subscribe to the DDC index. I think a lot of the DD DTCCI data gets published in there. And then what's your handle on Twitter so people can follow you there, get as. As real time as possible.

[Steve Racook]

Yeah, for sure. Our Steve data. And I'm the only Steve recook on Twitter, so.

Not the only recook though.

No, no. Dave has some great. Probably better content than me.

[Cody]

Debatable. Awesome. Steve, thanks so much for coming on.

[Steve Racook]

Yeah, thanks for having me.

Yeah, thanks, man. You've heard us talk about prescient AI before. We work with them at Jones Road. But you still might be wondering, what is it? What is this Mmm thing? At its core, Prescient really helps brands get more out of every marketing dollar that they're spending by showing them what's working, what's not, and where to spend their money next. The prescient team knows modern marketing is a sum of many things. Your media spend, seasonality, other marketing campaigns, consumer sentiment and so much more. That's why they don't rely on pixels bias, platform measurement or old research models to help you make the most confident decisions. They truly built their MMM from the ground up based on models that adapt to your data and evolve over time, not the other way around. If you want to measure the halo effect that your campaigns are having on all of your channels, yep, talking about E commerce, Amazon and even retail depression can help you out. You can test new channels, predict future performance of those channels, know how much you should be spending on each of them and continuously optimize. Optimize how you spend your budget to make it as efficient as possible. Which listen, we all need right now. You can do this all without sacrificing your upper funnel budget or bottom line. KPI's prescient has proven to us how truly incremental and efficient some of our upper funnel channels like tvr, that was very hard to measure prior to it. So if you've been wanting to try Prescient, they just upgraded their model and their vision across measurement and retail is truly next level. They take marketing decision making where it's never been able to go to before. If you want to learn more and gain insights into how you can optimize your entire media mix in as little as 48 hours, then go to prescianai.com operators and book a demo today.

[Cody]

All right, cool. So that was Steve Rakuk from Common Thread. I recommend everybody follow him and appreciate him jumping on for our first ever like intra episode guest. We've got a couple more things to talk about. Cody, you've been saying, well we should talk about that first.

[Steve Racook]

So. So we're going to try some segments. I don't think we named that one yet, but is that like an explain that tweet? Is that what we're calling it? I kind of like that explain.

[Cody]

That tweet's pretty good. That was, you know we've been sharing ideas in the group chat and basically I just throw in a tweet. I'd be like I'd love to hear more about this and spending power was definitely one of them because kind of a hairy topic. So yeah, we'd love to have more of them.

[Steve Racook]

Yeah, I like explain that tweet. I also I really liked what Dylan did when we had him on where just like tactically going over the heat map and you know like a tactical 10 minute session or something like that. So I think that would be cool. I think those would be some good new, new sessions to add in when we need to spice it up a little bit.

[Cody]

Yeah, 100%, dude. There's a lot of. A lot of really talented operators there in need of an audio first medium. That's what we're here for. All right, cool. You want to talk about your. The new PDP test?

[Steve Racook]

Yeah. So shipped it today. Brand new pdp. So we've been obviously testing a lot of things, but, you know, I want my. One of my goals for the end of year is essentially a site rebuild, but instead of just, you know, shipping it all at once and designing an entirely new site, we're kind of iterating our way there. So, you know, constantly a B testing, not as much as I would like, but actually we've gotten to a really good spot, but trying to learn from it and, you know, I think our PDP was built probably like this. This is probably our current one, is probably the second, you know, version we've had since we launched. It was pretty atrocious when we launched and obviously there's been a lot of small tweaks in Frankenstein, a B test and, you know, deployments after that. So we wanted to a clean it up. It's kind of. I don't know if you've ever felt like this, but it's like you test all these small things and you deploy them and then you look at your PDP and you're like, I kind of hate it. Like, it just doesn't make sense. It doesn't look good together. Even though, like, this test one and this test one so wanted to clean it up and then there was just so much that we wanted to do and improve and add a lot of, you know, content blocks around our main objections and things people are looking for. So this took a while. We had some team turnover. We had a new agency onboarded, so this was really like our first big project with them and took way longer than I would like, to be honest. The good news is we learned a lot in the process that I think is going to help us move and test a lot faster in the future. So way longer than I wanted.

[Cody]

What were some of those learnings?

[Steve Racook]

So we have an internal design team, but we don't have a UX designer, so we're using the agency's UX designer and it just wasn't quite feeling right and like on brand. And I hate giving that feedback to agencies because it's so subjective and it's not really that Helpful. And what we decided and the agency gave us this feedback and I think it was really helpful, was like, you just need to give us your exact design toolkit, like give us a design system like, this is where I use that font, this is where I don't. All that kind of stuff. And probably about halfway through it, I don't want to say we blew it up, but we had our internal design team kind of edit the Figma file and use this new version of the PGP as kind of the design system. And we didn't just go off of our existing site because there was actually a lot UX wise that I just was not very happy with. So we kind of like rebuilt it. And so currently this new PDP doesn't match the rest of our site because, like, I don't think our like, UX Best has best practices across the rest of our site. But we kind of like redid it, kind of like took a few weeks to lay it all out, you know, in a Figma file and organize it. And we even added some new fonts in and some new rules just to fix some of like the visual hierarchy and things like that and font sizing. And so we kind of paused, you know, slowed down and then allowed us to, you know, proceed with it and I think a way better place and got like their UX team and our design team kind of a little bit more coordinated. So that was a huge learning and just like speed, slowing down to speed up a little bit since then. We're developing right now, but we designed a new collections page template and use this design system, you know, and just so much faster and such a better outcome. So feeling good about it, but took way too long to get there.

[Cody]

Yeah. You know, you, you mentioned on Twitter that it took you guys months and I saw someone be like, it should have never taken that long. But you're really not giving yourself enough credit considering you start the process, you stop the process, you build the design system, then you go back to finishing it. I mean, you guys got a lot more done than just designing a pdp.

[Steve Racook]

Yeah, one tweet doesn't, doesn't capture that. I blocked that. But still, one tweet doesn't, doesn't capture that. Got no time for that negativity.

[Cody]

And what are. Okay, so you're testing it now. You mentioned some more content blocks around objections. Are there any other, like, big changes that you think are really going to make an impact?

[Steve Racook]

There's, I mean, there's a lot of small ones, like, so like rather Than showing all of the swatches, we have them, you know, listed out by like different sections. So if it's like a foundation, like light, medium, fair, things like that, so it's not just all at once better. Better increased font size, better UX and visual hierarchy on our upsells to drive some more attention to them. I thought on mobile our old images, like you have those little dots at the bottom to see those images. But I actually wanted to have like the thumbnail below the images to be able to, you know, scroll and swipe through them. Better UX on FAQs, we had a lot of nested things, a lot of like drop downs and people clearly clicking on it. So I was like, like let's just build out sections. Like if they're clicking on it, let's not make them go and search for it. Like let's do it. So we had like shade descriptions hidden. We built out to the new sections. One is a like a lookbook kind of. So I wanted to show like a filterable lookbook. So like let's say you're you know, light skin and you want to use Miracle Balm as a blush. You can click Light skin blush and you can see all of the shades that would apply to that and then you could hit a toggle that shows on model or on swatches. So just again, the biggest thing, the biggest feedback we get from anybody is how do I find my shade? And the more we can do to help people find their shade is another one, we get some feedback that like, like I don't know what Miracle Bomb is. So we built this section specifically for Miracle Bomb that just shows the four use cases of it, how to use section with videos on it. So just bunch of new sections will try to be just like a lot more content rich, ingredient focused as well. So you know, it's a much longer pdp but we'll obviously test into it. So yeah, I think just combination of more content and improved UX overall is what we're excited about. So subjectively it's to me a hundred times better pdp. It's not perfect. Like we still will test into it a lot but I am very nervous to test it because you never know when we put a lot of hours into this.

[Cody]

Yeah, totally. So you're testing it now. How'd you set it up? Intelligems.

[Steve Racook]

We set it up intelligems. I don't, you know, I don't know if it was a theme test or whatever, but yeah, running a 5050 in.

[Cody]

Intelligence and have you checked the data? You're, you're okay. How's it looking?

[Steve Racook]

I was hoping for like 69 lift just to be able to screenshot that. Yeah, we're down so far but you know, it's early worth looking so I shouldn't even have looked.

[Cody]

Let me ask you this. So let's say we go a couple weeks and it's like minus 4% revenue per session. You think, do you think the PDP is a hundred times better? Do you just, do you just launch it?

[Steve Racook]

Such a great question. And then it's like why even test it at that? Like that's my question.

[Cody]

It's like if I'm going to be catastrophic.

[Steve Racook]

Yeah, but, and then it's like what was even the point of building this if it doesn't beat it? And like does it change everything I know about market marketing? Like I would be, I would be demoralized.

[Cody]

Well, I hope that's not the case. I, I, I've, it's been a while. It was mostly last year. I felt like we were testing a lot of ecom stuff and like not getting any significant wins or losses, which was like almost worse frankly. That's why, that's why I posed the question. We've definitely pulled the trigger on like things that are I like way more and just had like a negligible impact. So it's like theoretically made no impact on the business. I just like it more. So we publish it. We spent a bunch of hours in time designing it and developing it. Just like you don't love that but you know, it's, I def, I described it as Sisyphusian. You gotta just keep pushing the boulder up the hill.

[Steve Racook]

It's, it's, it's really, I will say it's really frustrating and I, I really enjoy ecom. I really enjoy CRO. So many of the tests that I think are just like obvious. Like all of these kind of like best practices are just things that are just like clearly like a better website. Like don't perform. Like we tested, we just tested images. So we changed our last two images to have like our main value props with like ingredient college. Like the things we know people are listening and looking for. No, no lift on it. Like bigger font, no lift. Like way better description copy. Like I just so many things that you would look at and be like that's just like a no brainer, like obvious. So it is, it is really frustrating. But yeah, I think unless it's like a catastrophic decrease, like we'll, we'll end up going with it. But that would be a big bummer if it's not a winner. So hopefully we got some good data in a few weeks.

[Cody]

Yeah, 100. You know, one thought that I have. We, we did a test with Postscript. We were testing their. This isn't a great example but I'll tie it back to what you just said because I think it's true to some degree. We were testing their. What was their like smart conversation agent thing? Yeah, yeah, the name's escaping me but we tested that. This had to have been like Q1 last year or something and like we just didn't see a big impact in conversion rate. It was like the people that would convert, I just converted through the typical SMS or they would convert at the exact same rate whether they were getting like this one to one experience. And one thing that they said at the time was just like the people, the SMS subscribers that we were capturing were just extremely qualified. And it was like. And I wonder if some of the, and I mean you've mentioned this, like I think 40 plus of. Of revenue this year is going to come from returning customers. It's like yeah, this, the, the value prop images in the last two of the carousel probably don't make a big impact to those people and maybe, maybe it gets like diluted over time. Like I, there's no doubt in my mind that if you feel that having more value props, if you think they look great rewriting the descriptions, you think that looks better. Like those wins will stack up over time but maybe in a two week long test it just kind of gets like diffused by the amount of high intent traffic that you have on your site. That the people that it matters to are the ones that are there for the first time, who are just slightly more educated or who think the description was slightly better and now are gonna convert better over time. That's my, that's my. That's Hopium for us.

[Steve Racook]

No, I, I think that makes sense. I also. More, more Hopium. I like that word is like I wonder again because we have a lot of repeat customers and repeat traffic, like how much of an existing page is winning just because that's what people are used to.

[Cody]

Right.

[Steve Racook]

Which is kind of similar. That's my theory. Because like again we're testing a lot of these versions that I think are significantly better and it's not like we're just blindly guessing. Like we are looking at data and we're looking at heat maps and customer research and still not waiting. So I wonder if some of that. And I also don't think that, like, intelligence or any tool can, like, perfectly accurately tell you if somebody's a new visitor. Because, again, if you're. You know, I've been on our site in multiple sites, on my phone and on computer today, and, like, you'd be tracked as a new visitor, but I, you know, definitely not.

[Cody]

Or.

[Steve Racook]

Or I go. I just, like, by default, have incognito open just because I'm. I like. And constantly, like, trying to preview our theme and stuff. And I'm sure some people do that, so.

[Cody]

Yeah.

[Steve Racook]

I also wonder if that's part of it. I don't know about you and. And how often you check intelligence, but do you get your data flop a lot? Like, will you have one thing be a winner for, like, a week, and then you check in, like, a few days later, and it's like, it switched?

[Cody]

Yeah. D. I don't like, that's. I have no idea how that works. We've had so many. So many examples of, like, it starts out the way that you want, and it's like that for, like, 36 hours, and then, like, it'll shift. And I'm like. And I'm always like. I'm always skeptical of that. I'm like, why would it shift? Like, if. If it's a true a B test, but did my traffic makeup change so that, like, things started performing? Like, I don't even want to get down that rabbit hole. Cause you could just tell I've thought about it too much, and we've had too many, like, like, heartbreaking a B test result.

[Steve Racook]

So. Yeah, it's like when you, like, lose a race at the last minute.

[Cody]

Yeah, 100%. So anyway, Godspeed to you in the PDP test. I. I hope it turns out well.

[Steve Racook]

I'm just gonna be constantly refreshing, monitoring the situation.

[Cody]

Yeah, yeah. The Bezos meme, where you stand in there with the. The headset on. That's what I imagine.

[Steve Racook]

It was just like, hopefully I got some good news, and in two weeks, if you don't hear me bring it up, just.

[Cody]

Just.

[Steve Racook]

Just forget it ever happened.

[Cody]

We'll delete the. We'll delete this episode.

[Steve Racook]

Have you ever seen. Did you watch Ted Lasso?

[Cody]

Yeah.

[Steve Racook]

You know. You know the guy that plays Roy Kent?

[Cody]

Yep.

[Steve Racook]

He was a writer on the show. I don't know if you've seen this, but he. He, like, sent in a tape, and he put in a note with it, and he's like, hey, like, I. I think I could do his character. I think it's me. But, like, if you don't think so, just, like, ignore this. Forget it ever happened. That's like one of my favorite things ever. So that's what we're gonna do here?

[Cody]

Yeah, yeah, yeah. Fantastic. Yeah. No, it's a good way to do it. Ignorance is bliss.

[Steve Racook]

That's why I was almost like, not gonna test it. I think I'm like, I don't think I could actually do that. I think I, like, need to know. But I'm almost just like, I should have just shipped it. Should have just done it and not tested it. Then in my mind, it's like, it would have had like a 70% conversion rate lift.

[Cody]

Yeah, yeah, yeah. You should have launched it on the day of your Memorial Day sale, you know?

[Steve Racook]

Yeah, that's great.

[Cody]

Day over day revenue looks fantastic.

[Steve Racook]

And then go to board, be like, hey, I just built a new PDP that has a thousand percent conversion rate lift. Where's my bonus?

[Cody]

Yeah, 100%, dude. Well, awesome. Look, I think we covered a lot. Anything else you want to talk about?

[Steve Racook]

I don't think so. I think that was a good one.

[Cody]

Pretty solid. Connor and Cody up with the surprise guest appearance from Steve R.A. cook. Your.

[Steve Racook]

Your streak. 65 episodes. Still staying alive, dude.

[Cody]

Yeah, 100%. And I have no plans to slow down. I'll. I'll drag my. My mic and ring light wherever it needs to go.

[Steve Racook]

Yeah.

To make it a hundred at least.

[Cody]

I felt good about crossing 50. 65. Now we got another one Wednesday. I think I could hit 100. A thousand even.

[Steve Racook]

You got this. All right, let's. Let's start 100.

[Cody]

Yeah. Awesome. All right. Thanks for a great app. All right. Thanks again for Steve for coming on. Thank you. Listener for tun for another week. As always, make sure to like, subscribe, leave comments, tweet at us. If you've got any comments or questions. We've got the moparator hotline in the description. If you've got any questions, we'll be answering those on a future episode. As always, thank you to our sponsors Motion rich panel after cell, prescient and house. And we'll see you next week. Thank you.