Hey there. This is coming a week after anticipated, but I was a little pre-occupied last week. My wife and I sold our first business last week, so obviously that was the priority. But I hope this is worth the wait.
I’ve been thinking about and planning for our growth in 2022, and I wanted to give you a peak into my brain and thought process as I’m doing so. Usually in these newsletters I plan to document what I have already done and learned, but this one will be a bit different.
Just a quick recap, we pretty much had our first full year in 2021. It was an amazing year, with lots of growth so there’s a lot to be grateful for.
We had some team members come in, and some go out, and now we’re slowly looking to build our team. We’re really looking to have a really big 2022 with lots of growth. Let’s just say the goal is to double growth. What I want to do here is just lay out my thoughts transparently about how I’m approaching it from my end.
I have to look at things from all sides, not just paid. When I’m thinking about growth, we don’t have a growth at all costs mentality because we’re bootstrapped, so we have to remain profitable. Plus you see how that mentality has worked out for so many.
There is definitely strong demand for our products and brand right now. We could easily raise a round and spend to the moon on growth, but we don’t want to. We want to do it differently, build a business that is great if you don’t sell it or choose to sell it, and one that produces free cash flow.
So with that being said, our growth has to be sustainable, and it’s not growth at all costs. It’s super important to keep things in in tandem working with each other. We don’t want to overspend on paid and neglect organic growth. We don’t want to buy our customers at a loss and hope that we’ll get paid back before the bills are due.
We’re going to be pretty conservative about it. I still think that we can do it and double year 1, but it’s going to take a lot of thought, a lot of effort, and a lot of strategy and not just doubling down on paid.
For us, paid is not the thing that’s growing or scaling the business. It’s not the business. It’s one of the things that is supporting the business and it’s important, but it’s not the thing.
I’ll start with organic growth. To be totally honest, organically, we haven’t had a ton of strategy. We haven’t had a growth mindset and strategy in terms of organic.
We have a good amount of organic traffic because we launched with a name and a recognizable founder, so that’s been great to initially build our audience. But we haven’t had an organic growth lever outside of that initial success, which is a must moving forwards.
I like to break all media in terms of earned, owned and paid media. Calling organic channels like SEO and Instagram followers owned audiences is a huge pet peeve of mine.
Ask anybody who built up a big Facebook page or something similar. They didn’t own their traffic. Ask Vitalik (the founder of Ethereum) if he owned his WOW character. He didn’t, and you don’t own your social audience. You’re renting it from Zuck. But I’ll get off my soapbox here and actually try to be helpful.
When we launched, we didn’t really have a brand deck. A ton of thought went into our visuals, but we didn’t put enough thought into our mission, values, and USP, aka our brand strategy.
As a result, we need to do a much better job of engaging and storytelling with content to build a brand that people rave about. Who are we, why do we exist, what are the problems we are solving in our customers lives, etc;. Those are all the questions we need to do a better job of answering in our content.
I want to weave these brand pillars and values in every touchpoint along the customer journey, from ad, to landing page, all flow emails, unboxing, and obviously all social content. So I think that stuff is super important, and it means dialing in our brand strategy and mission so we can communicate better.
Right now our communications are too product focused, and I think we’ll get much better engagement and reach with better content and storytelling around emotions and promises.
I think doing so will also help our retention and loyalty. Right now we have very good retention, but we mostly have it because our customers love our products. Now don’t get me wrong, having great products is a must. But I don’t think you want customers sticking just because your product is great.
It has to be, but you want a great product with a really strong brand. I’ll give you a personal anecdote of why you don’t want to just have great products.
Personally, I spend a lot of my time in athleisure clothes, so I used to spend a good chunk of change at Lululemon. I was definitely a high LTV customer. I was never super captivated by their brand, but the products were the best out there. I probably spent a thousand dollars a year, if not more on Lulu.
Now all of a sudden, Vuori comes along and I’m gone. I don’t necessarily feel a strong emotional connection to Vuori’s brand either, but their clothes are just so damn good. Even though I was a “great” customer to Lulu, I wasn’t a loyal customer.
Someone came along with a better product, and someone can always come along with a better product.
Compare that to Apple. Probably overpriced compared to their competitors. As a business and what they stand for, I hate them. I think they’re evil and I hate what they’ve done to this industry.
But when my phone stopped working one day, I didn’t hesitate to drop a G on the new one, even though an Android can do all those same things for probably half the price. Yes they have a good product, but they have an incredible brand.
We don’t have millions to spend on TV ads like Apple does, so we have to get a little more strategic. What we want to do is put our “branding” in as many places as possible along the customer journey so people just get bombarded with it and feel our values all the time.
Tactically, this means that we run video ads with the founder and UGC, and instead of just talking abut the product, we make sure to weave in our value props and what not. We send that traffic to landing pages that make sure to highlight our brand pillars and do some storytelling.
Maybe we use UGC in retargeting where our customers talk about their experience with the product and how it makes them feel, as it relates to our brand pillars. We can also send retargeting traffic to our best press articles. On the website, the same messaging needs to be shared.
We need a better about page, but most people won’t go there so we need to highlight everything in 3 seconds on the homepage. Then all of our email flows need this messaging as well, including where people get lazy, their transactional flows.
You have to think that every single touchpoint with your customer is an opportunity to create loyalty and weave your brand pillars and storytelling into their lives. Every touchpoint should make them feel special.
If I have 2 ads, and they both have the same CPA, but one is just a static product focused ad and one of them is a video with brand pillars and a story, I’m picking the latter. People will remember the story ads much more, and I’d bet customers that come in on those have a higher LTV.
When we drive to landing pages, we want to weave those elements in as much as possible. So where trying to optimize our acquisition for retention and loyalty. That’s really it. It’s not just about how can we drive down our CPA. It’s about how we can acquire the right kind of customer, and nurture them into being a very loyal customer.
So that’s how I’m looking at brand and organic. We have a really strong PR team, so I wont go too much into it there. But we’re looking to do a lot more performance partnerships there. For example, our top retargeting ad the last few months has been driving to a Byrdie article reviewing our products.
It was just written organically, but we’re planning to partner with some publishers to get some content written and whitelist to them.
Overall, we have a great PR team and we’ve been fortunate to get a ton of great press. But there’s a quote I really great quote, which is, “you pay for ads, and you pray for PR”.
PR is great. We’ve had some incredible days when we’ve gotten some big hits. But you know, you pray for it. So it’s not always in your control. I don’t like that. I like being in control as much as we can.
So that’s why we really also need to focus on owned audience growth as much as possible. If you’re building a brand and not prioritizing building owned audiences, you need to be.
One simple one is just optimizing pop-ups at all times. We haven’t done a ton of that, so that will definitely help. We are also going to continue pushing our quiz. We’re going to be pushing it on Paid Social a ton more, so that should theoretically build our list a lot.
We’ve done a bunch of things this year, all the standard stuff like launching a quiz, getting the core flows live, etc; but we haven’t done a lot of optimization, and that’s ok.
We’re a really lean team right now, and time is limited. But in year 2, we are definitely going to grow our team and spend more time optimizing every aspect of our marketing.
I want people to know that you don’t have to optimize everything until you get to a certain size.
We haven’t really done any legit CRO, we haven’t spent a ton of time optimizing our email and SMS flows, etc; and that’s ok.
I think the first year is about directional testing. Testing a bunch of strategies, and getting the first 80% out of them. Now that we have data on which direction to go in, year 2 will be spent optimizing and getting an extra 20% out of each of those strategies.
For example, we launched a Quiz and it did really well for us. That tells us that the strategy was solid, and now it will be worth the investment to take the time to optimize every aspect of the quiz.
So I want to get as many customers going through that quiz as possible because customers go through our quiz have a higher conversion rate, higher AOV, and higher LTV. I haven’t looked, but I would guess they also have a lower refund rate.
The quiz is also our best way to acquire emails. There are just so many benefits to it, so now we are going to take the time to make it amazing.
The quiz kind of started as a shade finder for one product, then we added in another product. Now, I’m thinking of it as more of a product finder and shade finder. I want it to be a great experience that would be a very similar experience to how someone would get recommended products if they walked into our brick and mortar store.
This should theoretically improve LTV and refund rate as well. For example, right now nearly all customers are recommended our best seller Miracle Balm. But it’s not great for people who have oily skin and prefer a bit more color payoff.
So, we will build out some better conditional logic and personalization so people who have have oily skin will get recommended The Lip And Cheek Stick instead.
We have a pretty lean and basic welcome flow for the quiz built out right now. To be honest, it’s not great. But the revenue per recipient is nearly double our normal welcome flow.
So, now that I’ve seen how well it’s doing without being optimized, it’s time to optimize it. We’re going to take the time to make it the most awesome and personalize welcome flow in the world. We’ll build really targeted segments based on that zero party data.
And we’ll even use this data to segment and personalize our post purchase flows.
In 2022, you should be looking at acquiring as much first and zero party data as possible.
I want to get as many customers going through our quiz as possible, so we’re going to add a “Find My Shade’ button on all PDPs that have shades that leads to the quiz. In addition, we’ll also utilize quiz in our paid social efforts a lot more going forwards.
Quiz ads have done really well for us in retargeting, but we haven’t really cracked them in prospecting yet. But I plan to do a lot more prospecting to it, especially on Facebook and TikTok.
See my recent thread on it below…
But if you think about it, it makes total sense. If we can get the quiz ads to have the same CPA as normal ads, the quiz ads have a better ROI because they collect way more emails.
So we’ll test them and optimize our flow to maximize the value of a lead.
One more thing about organic growth before I finish up with my plans for paid. We have a current editorial site that kind of exists as a linear commerce play, but it’s not growing and it’s not super thought out.
So we’re trying to figure out what do to there. It’s probably going to be a big focus this year so we can continue to grow our owned audience and lower our reliance on paid.
But it’s really early in the process, so I’m not going to share too much until we have some more direction on it.
Now I know this has been a long newsletter, but let’s talk paid.
My entire goal is to diversify our paid traffic sources in 2022.
I think Facebook will still get the majority of our spend, and I don’t think we’re necessarily going to get better performance on any other platforms.
But I’m terrified of growing a business that’s dependent on one strategy or platform, so I want to get our traffic from as many sources as possible. Now caveat that with the idea that you can’t do everything at once and do it well, so this is a long term plan where we’ll test 1 channel at a time.
Let’s start with Facebook. We’re doing well there, so I don’t think we’re going to squeeze a ton more efficiency out of it. I think we just have to focus on maintaining as much efficiency as possible as we grow spend, so there are still a bunch of things I’d like to test.
Creative is king, and our creative can be better. I want to get a lot more high quality creative , and I want to build really good internal systems for testing and communicating within our team.
I’m trying to bring everything we can in house this year so we can move really quickly and also collaborate and review metrics with all stakeholders.
I also really want to test landing pages. We’ve done very little of it, and it definitely could be a lever for us. Most of our traffic has gone to PDPs this year.
A few that I’d like to test are advertorials/listicles, standard product landers, and something that I call the Faux Homepage, which looks exactly like a homepage to the casual observer.
I think this will be a really big focus for us in early 2020.
I’d also like to test offers. We’re not a brand that does much discounting, so we have to be careful here. The farthest I’ve gone to testing offers is creating customized sets with small discounts built in, and they have done super well.
But I’d like to test evergreen offers, perhaps with more custom sets or GWPs baked in. The trick here is doing it an an on brand way that still acquires the right type of customer vs a discount customer. That’s the key.
The other thing I want to test is publisher whitelisting. I’d love to run some stuff from publisher pages to sponsored editorial content, mainly in retargeting.
It should be great for overcoming objections, giving third party credibility, and I think the more education and storytelling you put before the sale the better for LTV.
Again, I’m always thinking about acquisition rooted in retention.
In terms of Google, I don’t really know. I don’t know if categorical search is going to be a thing for us or not. I’m honestly not a Google expert, so I’ll leave it up to the experts there. But I don’t see us doing too much with Google outside of scaling Shopping a bit.
We launched on TikTok about 6 weeks ago, and it’s going pretty well. Just testing creative, offers, landing ages, and account structures right now.
I’d say it’s going well. It’s also taken me to now to figure out how it’s performing because the attribution is so horrible. We’re spending way less than FB, and I don’t think we will ever be spending hundreds of thousands there. But if we can scale it to $30k to $50k a month with decent performance, I’d be happy.
Right now our AOV is lower there, and I’d imagine LTV will be lower there. So a big focus will be testing offers and landing pages to get those both as high as possible; I think the quiz will be huge there as well (as I talked about in the thread linked above).
I think it will take the next quarter to do a lot of the testing we want to do on Facebook and TikTok. Maybe even the next 6 months, so I don’t think we will launch onto anywhere else until then.
When we are ready though, I think YouTube will be our next platform. I actually think it’s going to be pretty big for us. I think TikTok is lower hanging fruit and a lot easier to pull off both in terms of the buying side and creative, but I think YouTube will be more impactful in terms of scale and the acquiring the right types of customers.
We’re also hiring a Director of Influencer, and they will be creating an affiliate program as well. We’re trying to get our traffic from as many sources as possible, and I’m hoping Affiliate will be a big one for us.
If you made it this far, well done. I know this was a long one, but I hope it was semi valuable. I know it probably seems all over the place, and please give me feedback if it is.
But I just wanted to share a peek into my mind as I am thinking about our how we can double our business this coming year.
Any questions or feedback are always appreciated. Twitter is the best place to reach me, @codyplof.
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