Podcast

The UNOROTHODOX Way To Increase AOV

September 12, 2022

53:48

Hosted By

Rabah Rahil
CMO at Triple Whale

Guests

Ash Melwani
Co-Founder & CMO of MyObvi
Jordan Menard
Father | Creative | Growth Marketer

Episode Description

In this episode of adspend we drop some HEAT. We go over Retargeting, outrageous budgets, how to scale, and more. #Adspend

Notes & Links

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- Ash's Twitter: https://twitter.com/ashvinmelwani
- Jordan's Twitter: https://twitter.com/jordanrmenard

Transcription

Jordan Menard (00:00):

Folks need to test a lot of creative, um, all the time. I think one of the things that nobody thinks about when they're scaling is that as you break past that 20 K per day range, the life cycle for the creative starts shortening constantly.

Rabah Rahil (00:19):

And we are back for another episode of ad spend. I am accompanied with my co-host amazing favorite Indian amazing dress, best swag on the planet, Ash Milani, and fill in the third seat today. We have the hitter of hitters, the ocean beach crusher Jordan. Mayard also a big fan of your, uh, head of acquisition over there. The other Jordan. Um, yeah. Also love him. I saw him in, uh, San Diego geek out, but, um, we're gonna get in some fun stuff today. So we're gonna get into, uh, a little bit of spicy take on is meaty buying dead. So we'll, we'll get a little spill, some tea there. And then we'll also talk to Jordan about what, what he's doing right now, cuz uh, Jordan manages some fairly big budgets. Um, and so there's some different things that you same, same, but different, but some, some really interesting things and takes that he has in terms of how he scales up his budgets to kind of these, these top tier budgets. And then, um, Ash also chime in as well. And then I'll just be the fly on the wall, letting these geniuses go at it. So where do you wanna jump in Ash?

Ash Melwani (01:22):

Um, I think, I think it would be good to kind of see where your head's at with what's currently going on in the last couple weeks. A lot of people have been talking about performance, kind of being a little bit volatile. So what are you seeing in the landscape? Are there, you know, any easy wins right now or is it all kind of like just difficult? Like give us some, uh, give us some gold nuggets.

Jordan Menard (01:44):

Yeah, man. Um, I don't know how many gold nuggets I got on, on this exact question. Um, <laugh>, it's definitely difficult out there, right? Like there's no way around it. Um, you know, I think, uh, David Herman, uh, shout out to him really smart guy. Yeah. He had a tweet today talking about how, um, looking at a seven, 14 and 30 day window on Facebook, it's actually less volatile than other platforms. And so I think, um, you know, compared to everything else, Facebook is actually relatively stable, but compared to what Facebook was two years ago, uh, it's pretty volatile. Um, we see a lot of swings, um, and uh, it's not as bad as it used to be. I think, you know, it's, it's slowly getting better. Um, but we're definitely still seeing a lot of volatility. Um, one thing I think that I've noticed a lot is, um, just how much people have to be in the accounts, um, and how often weird things will happen.

Jordan Menard (02:35):

Um, you'll plan for something and you'll push on it. Um, let's say it's like a really aggressive scale strategy that you want to implement and um, in your head you think, Hey, I, you know, we, we did the numbers, we really looked at it, the offer's hot, like this should work and then rubber meets the road and things blow up as you're pushing. Um, and it's a lot more difficult to put to hit those numbers. So we're definitely seeing that still making it work, still spending, uh, pretty big on some of our biggest clients. Um, but the volatility is real. Um, at least for, for Facebook, I think compared to everything else, it's still pretty solid, but we're definitely, um, seeing some of those issues. Are you guys seeing that same thing?

Ash Melwani (03:12):

Yeah, I mean, we tried to push the budget, so we were at like a daily average of like 20 K a day. Um, and I think we were in a place where we just got more inventory. Things were on that like supply chain and things were good. So it's like, all right, well let's, let's push it. Right. Um, try to bump it 20% up until we got to 30 K and I think that's when things broke. Um, and, and also there's that tied in with what was happening with Memorial day week? Um, right. I just don't think people really were like, I mean, we, we talked about it with Trey on the last episode, but like people really weren't buying collagen, they were buying white claws and, and beer, you know, <laugh> so, yeah, that's right. It's not really the time for us right now, but I mean, June 1st, like today, you know, things are kind of stabilizing.

Ash Melwani (03:57):

Um, but the big thing that I'm trying to focus on and, and I've seen a lot of these guys talk about it, um, is seeing how we can improve our AOV, um, and conversion rate because as we scale, we're definitely gonna see that increasing cost. So I think maybe even discussing how you guys, you know, pushing 30 K plus a day and spend, how do you counteract the rising cost with like either increasing conversion rate or boosting AOV, you know, what are, what are certain things that brands need to do in order to do that? Um, if you're like currently hovering where we're at, like 60 to 70, you know, how do I get to that 9,000 to, to combat the, the increasing cost?

Jordan Menard (04:38):

Yeah. Um, great question. Yeah, for sure. Um, so I think there's kind of a give and take play here because lots of things that increase conversion rate will typically decrease AOV. Right? If you have an offer, you do something like 20% off, it's gonna bring down your AOV and bring up your conversion rate. So I think a lot of it is a question of what sacrifices are you willing to make. Um, and what trade offs do you want to take? Um, I think something that our clients tell us a lot is like, we, they want us to think about their business, like the CEO does, right? Like, can we make sacrifices here to gain that bump and spend, um, and we see different things work. Um, we're a big fan of bundles. Um, love seeing bundles. Um, what's also cool about bundles is you can factor in that discount and that's one of those rare times where you can increase the AOV without, uh, or increasing conversion without, uh, decreasing the AOV much, um, free gifts work really well.

Jordan Menard (05:31):

Um, in Q4, some of the best offers that we saw were free gift offers during black Friday. Sometimes they outperform discounts, just percentage discounts or dollar discounts. Um, I think a, a, you know, increasing AOV is one thing I think another would be increasing LTV, right? If you can increase your email game, you increase your SMS game. Um, and you shorten that cycle from first to second, third, fourth purchase and increase that 90 day LTV. Um, I, I think that can also give you in effect the same result, right? You can have a higher C because that LTV window, um, is realized quicker. Um, but I would really, you know, to answer the question proper, um, is, you know, just, uh, love seeing bundles love, seeing free gifts. Um, those types of offers are the most exciting. And then, um, you know, Ash, what you guys do too. We see a lot of our brands do with, uh, limited releases, um, right. It's a great way to, to drop something without sacrificing price, uh, have a limited release, especially if you have a raving fan base, um, those types of offers can be really exciting and kind of help, um, create some of those peaks, um, when otherwise you would be going through some valleys.

Ash Melwani (06:37):

Yeah. I mean, what you just said is basically everything, what we're doing. Uh, so it's good to know that we're on the right track. <laugh> um, I, I think the, one of the, the biggest things you, you said, right? It's like, how do you what's that trade off? Right. So are you affecting conversion rate? Are you in improving AOV, things like that. Um, and then also kind of, I guess, increasing the LTV of things like, uh, of, of your, your current customer base for brands where like cash flow is a big issue. Right? So for example, for us, right, we're completely bootstrap. We're utilizing all the FinTech tools that we possibly can, um, you know, shout out to Parker and, and plastic and all these guys where we're able to take our, you know, spend that we have, you know, that we're incurring today and push it out.

Ash Melwani (07:25):

Yeah. Almost 120 days. Yeah. Um, in that timeframe, we're also trying to boost the LTV. Right. But for like a product that people are meant to take every day, but may not take every single day. It's like in that timeframe from 60 to 90 days, are they even ready to purchase again? Um, right. You know, so I think that's one of the biggest issues, which is why we really wanna like focus on bumping AOV, because when we did the study of, um, if the, the retention on people who buy bundles right. Higher AOV versus just a single product is mu has much higher LTV because one, they're either using more product, therefore seeing results, right. You need to take collagen for at least two to four weeks before you even see results. People think they're gonna see it after one day, but if they buy like three canisters, they're like, okay, well I have to get through all three.

Ash Melwani (08:16):

I start seeing results. And then they're, they're, they're stuck with it. Right. So being able to like, do you, do you get somebody on a six month supply and don't see them for maybe a year, or do you kind of, you know, try and get them on a subscription. So it's like, you know, lower conversion rate, but then at least, you know, that there's a, there's a, there's a model that's being built monthly, um, to, to help with like that, that overhead and, and, and monthly income. Um, but yeah, it, it, I don't know where what's right. I mean, it depends on the business. Right. So exactly, I guess, I guess for, for us, you know, it's like AOV right now, it's we just try to offer more right. Without, without really hurting conversion rate.

Jordan Menard (08:59):

Yeah. And I think something that can be interesting too, cuz we see the exact same thing, right. That the higher AOV bundle customers end up yielding a higher LTV, um, which is, which I think is pretty interesting. Um, and I think a lot of it's what, what you just said. Um, I think there's also a more qualified customer, right. Capable of spending more probably has a little more disposable income. Um, and I think there's other ramifications of that type of person and their purchasing habits. Um, but without diving too deep into that, I think something that's really interesting is like, I don't know if you guys know the guys from Joby coffee. Um, yeah. Formally with

Ash Melwani (09:32):

Met. I just met them in Miami.

Jordan Menard (09:35):

Yeah. Just awesome dudes. Um, shout out to Brandon and Justin. Um, those guys are just great, um, great people, great marketers, great brand owners, uh, great operators, um, just all around. Good, good dudes. And so, um, if you look at their checkout flow Ash, I really highly recommend, um, one it's like completely custom, right. So they built everything themselves. Um, and I think you're afforded a lot of, uh, different opportunities when you have that flexibility. Um, two, they have a lot of really sick post-purchase outsells, right. Um, where they're selling other things on top of the, of the original purchase. Um, and being that you guys have other stuff like the, uh, the fruit morning supplement, um, what's it called?

Ash Melwani (10:16):

Uh, the, oh, the superfood, uh, pinks.

Jordan Menard (10:18):

Yeah. Superfood pinks. Right. Um, you know, like pairing those on in a post-purchase upsell with a bundle, um, could be a really intriguing option and it's not gonna affect conversion rate because it's post-purchase so we, right. We really encourage our brands who have multiple SKUs different products to tack on those post-purchase upsells and find different ways they can generate more revenue after the sale. Um, cause I think in some ways you can get the best of both worlds there.

Rabah Rahil (10:45):

That is really clever. I didn't think about that cuz you're right. The it's no longer a function of the conversion rate cuz the conversion already happened. So it's just sauce on the that's right. It's just sauce on top

Jordan Menard (10:55):

And there's, that's

Rabah Rahil (10:56):

Actually pretty cover

Jordan Menard (10:57):

And there's Shopify plugins, um, that can actually, um, keep the same cards. You don't have to run the card twice or put the card, um, in again, right. You can just click through it and, and purchase and um, you know, rumors, a lot of friction. So I think a lot of those things are super interesting. Um, I think other things that are really cool, um, are like, uh, creating like super engaged lists or like a list of really engaged customers, uh, people that have purchased, you know, three, four times and then creating a landing page and offer just for those people. Um, and then sending that via SMS email or through ads and from what I've been hearing and kind of what I've been thinking, I've heard that that's the highest converting page that you'll make. Um, so that's something that we're just starting to look into. I don't have any data on it cause we haven't implemented it yet, but I'm very interested in it. It's kind of some stuff I'm thinking about

Ash Melwani (11:49):

What would be the theme of those pages like offers?

Jordan Menard (11:53):

Yeah, I think it would be an offer with a, with a nice discount. Um, I think it would be very customer centric, right? Thanking the customer for their loyalty to the brand. Um, and then making it very clear that this is an exclusive offer. That's only being offered to a, a small slice of your customer base. And I love that play cuz it's very honest, right. It actually is only offered to those people. Um, and those are people that, you know, are highly engaged and, and like your product. And I think that it can be a nice LTV boost by creating an offer designed just for the people who really care. Um, and you know, the fact that you guys have community backing it, I think could be a really cool play as well. Mm-hmm <affirmative> I think that would get good engagement, right. People, um, the, the chance of social proof, someone posting something in the community about it, um, is higher there. And I think that can just, you know, increase LTV long term. But again, um, we're working these ideas out too. This is something that, that we're hook up as well. So I don't have any, any like real rubber meets the road data.

Ash Melwani (12:52):

Yeah. I'm curious if that would be a good way to intro people into subscriptions, right. So you have your, your high V I P customers, um, send them to a landing page like, Hey, listen, you're, you're buying a shit ton. Why don't you get in on a subscription, save X amount, um, be able to completely control your subscription for us, like change a flavor every month. Yeah. Change it to another product. Yeah. Pause this and that. So I think that might be a good way to educate people on that. Um, and really showcase like the savings that they can get from that, but then gives us a little bit of a cushion as well. Um, in that recurring

Jordan Menard (13:27):

Revenue. And especially if you're using stuff like SMS, sorry, uh, Robin, especially if using SMS and email. Right. Cause you're, you're you're you don't have to pay that acquisition cost on the front. Um, exactly. So go ahead, Robin.

Rabah Rahil (13:40):

Yeah. So I had two questions there cuz there's or one statement and one question, cuz it's just super, you guys are just brilliant people. Um, so I did, uh, uh, little mentor pass thing, shout out Kenny, um, and the company I was consulting with. Um, it was interesting and I don't know if you've looked at this data at all Ash, but pretty much every single subscription was never cold. It was always a try before you buy kind of thing. Like they did that. Is that kind of more so for you guys? Yeah. So I thought that was actually really fascinating. Yeah. People won't, it makes sense though. When you think about it, like you're not gonna subscribe to something you haven't tried before. Um, but the other thing that I was gonna say, um, that you said kind of at the top of the show, Jordan, that I think is brilliant is I used to, when I was running my agency, we were in beard care and we like notoriously beard care is one it's really hard cuz there's like everybody in their fucking mom has like a beard care company.

Rabah Rahil (14:31):

Um, and then two, uh, the AOVs are really, really low usually like, you know, 20, $30 kind of thing. And so what we did is he had a bunch of really high selling high margin products, but they were, they there, it was like, for example, this little like little beard scrubber thing, he just sold them like crazy. And they, they were like seven to $10, but they cost them literally like 70, 80 cents. And so what we would do is that free gifting. And so if you buy X, Y, or Z or threshold stuff, and then you get a free gift and that was really, uh, efficacious in terms of boosting that AOV. And I don't know if you guys had anything of that nature where, um, you had a high perceived value of a product, but it's a low, uh, in terms of cogs, super low cost.

Rabah Rahil (15:18):

And so you might look like you're getting a $10 product or eight, $12 upsell. Um, but you're gonna boost you really the, the, you know, product's gonna be a dollar or two off the nut, but you're really boosting the, it looks like you get a $10 discount and now you buy two things at collagen and now you you're getting into that higher AOV cuz I know you guys' merch game is super strong. So that might be something that could be interesting in terms of finding a high margin, high perceived value product, um, that you can bundle to, or to award people for spending more or buying things together.

Ash Melwani (15:55):

I have a really good example of that. Um, I'm not gonna, I'm not gonna say the names of the products just in case some customers are watching <laugh> um <laugh> but there we, for one of the products that is technically on the lower side of a reten being like retention product, um, we to really combat that you need somebody to at least have multiple months on this specific product to really see the results. Right? So what we did was is on our buy box, we have the single 20% off that's it, but in the, in the second buy box, that's where the deal is. It's like 25% off and then a free product right now, this free product is actually worth more on the website, but costs less to us. Okay. So we offer this free with this three bundle. So at the end of it, you're getting three of the products and you're getting this high valued item, which also is a higher retention product below cost to us. So you're getting two products out the door into somebody's hands. Um, but then you're also because you're getting more, that higher LTV kind of kicks in for low retention product in general. Um, I was literally just looking at these numbers that bundle has obviously less like orders than the single, but brings in more revenue there then the other one combined. So super, super interesting that you just mentioned that. Cause I was just looking at the data for that and it, and it works like crazy.

Rabah Rahil (17:28):

Yeah. And the economics net out too, because you're,

Ash Melwani (17:31):

To your point,

Rabah Rahil (17:32):

You, this was the exact same anatomy where this was a super high retention. It was like a shower brush, scrubber, um, thing. And it was a super high retention product and it was just great to bundle cause people were already gonna buy it. So it's like, oh yeah, of course I'll buy another beer jelly or shampoo or what have you. And I'll get this thing that I, I was gonna buy anyways. And so yeah, that could be something of interest, but the, um, that and the subscription stuff. But I have yet to find anybody that's really cracked the, getting people into subscriptions really effectively. Um, because it's just, it's so hard. I don't know. It's, it's hard,

Ash Melwani (18:05):

That's a lot greens, right. Is subscription first, like subscription only.

Rabah Rahil (18:09):

I, I don't know if it's subscription only, but they're heavily, heavily subscription mud waters kind of the same, same but different. But those are really, I don't know. Don't gimme all my, for those soap box. Yeah. Don't gimme all my soapbox there, but mud waters, probably a better example where I think the things that do well in subscription are cyclical base or ritual based like athletic greens is kind of in that summer. And I guess maybe the collagen could get into kind of a ritual base play there. But um, I just find that you get into the, um, the hoarding issue where like matching up the consumption cycle with the subscription cycle. Cuz if you send em too much product, they're annoyed, if you don't send in the product when they need it, they're annoyed. And so like that calibration can be challenging. Uh, yeah. I don't know. I haven't, it would be interesting to see athletic greens is, um, kind of churn right. As well as their economics cuz they push pretty heavily into that. But I know, I know mud water does really well. Uh, but again, it's like,

Ash Melwani (19:07):

I would just imagine the CAC is like super high, but then they know that they can make it back within like three or four months just cuz they're already, that's guaranteed almost, you know?

Rabah Rahil (19:19):

Yeah, yeah. Definitely to see that churn. Right. But I don't know. Yeah. What, what are your thoughts Jordan?

Jordan Menard (19:24):

So I, I, you know, I think some of these examples, like athletic greens are super interesting because we work with a lot of bootstrap brands, right. And a lot of bootstrap brands they cannot afford to take that big hit up front. Um, they need the cash flow. Right. Um, I don't think all of them are as good at cash flow management. Like um, you know, you guys are at Avi, uh, with, uh, you know, the negative cash flow cycle. Yeah. Shout out Ron. That's so cool. Um, but even still, like I know most of our boots shop brands just can't afford that. Um, so I think, um, it's interesting because you know, VC money has a really low hit rate in D TOC. Um, I don't know what, I'm not really sure why that is, but it seems like most of the best brands are bootstrap.

Jordan Menard (20:05):

Um, and with that I think comes more challenges. So I think part of the reason why it is hard to crack that subscription model is exactly what as is saying that that cost proposition goes up so high that most people can't afford it on the front end. Um, and then, you know, other brands like goalie are, are super fascinating because you know, they want to have like a 0.2 Roaz or something on the front end because they know that for one bottle they sell online, even not through subscription, just through like word of mouth, email, SMS, they're gonna sell like five to 10 on the back end. Um, so they're willing to take that huge hit up front because it does, um, break down afterwards. But you know, those cases are so rare. Um, it's, it's very hard to make rules off those exceptions.

Ash Melwani (20:51):

Yeah. It's tough. It's tough. Cuz then you as a marketer, wanna Mo model after these successful brands, but you really can't because like you are not there financially. And so like for example, when I'm talking to like, you know, friends of the space that, you know, kind of in the same, you know, industry and niche where it's like, oh our C is like 70 bucks, but our AOV is like 110 and it's like, well our C is like 50. Our AOV is like 70. I'm trying to like mimic your model and look at your landing pages and see how you are doing it. But then I also, I also need to kind of go back and somehow cut our CPA. Right. So, you know, but they're like, well we don't really care. We'll spend, we can spend $70 on a, on a customer. So who do you, who do you really model? Right. Like you can't really the brands that are killing it are just spending a shit to, and they don't really care. Um, so I, like you said, I, I respect the bootstraps cuz like they have to make it work that's right. They have to figure it out and have to like cut their, their CAC or increase their conversion or that's right. Increase their AOV. So there just the, the model doesn't work

Jordan Menard (22:00):

That's right. And I think that the best boots trap brands as they continue to grow, they're always like the question is what's the highest possible CAC that we could can allow? Like what is the absolute highest we can pay to acquire a customer? And I think that's a great debate, right? Um, I think a lot of our most successful brands, that's a big focus is like, cuz they know like an extra $3 can make a huge difference. You know, when you look at a month timeline, um, but uh, you know, those brands still have to be, I think if they're really good and they have their, uh, their 90 day LTV CAC ratio to at three to one, right where they're essentially breaking, even on the first purchase they're gonna make the second and third. Um, over time we see brands with that model succeed and scale the hardest, um, without taking a real big hit on the front end. And I kind of suggest that to anyone who's really looking to kind of create that model without taking a loss on the, on the first purchase.

Rabah Rahil (22:58):

I love the VC thing too. That's so fascinating cuz now I think about this, especially now that the market's kind of UNW um, like Uber and Lyft and like all these like darlings, especially Uber and specific, like just the darling of VC capital totally made the, uh, was it what's girl's fund the Sequoia. I forget who, but pretty much like the Uber deal made all their, their whole fun, the Uber deal made more than all of their past their previous deals combined. Like, I mean it was just this huge exit, but I don't know like if that plays to VC or if that plays to DTC because the one cheat code that those VC back companies had was um, basically the whole thing was, I mean, for lack of a better description, it was a pump and dump scheme where you get this, you show this crazy growth, you just keep raising, raising, raising, and then you dump a shitty company, a non-profitable company, a company that's never gonna make money on the public markets and everybody gets their bag. And like, I can't think of a, a DTC company that's really ever done that. Can you like, that's been just pump, pump, pump, and then, uh, Hava or I can't ever say the, the fancy sandals, their, uh, quarterlies just came out and just absolutely atrocious mm-hmm <affirmative> like, and so I, I'm trying to think of a really big VC backed DTC brand that landscaped

Ash Melwani (24:16):

Didn't that whole thing.

Rabah Rahil (24:17):

Oh, they got landscaped, they got wrecked. They had a weird thing though. Cuz a lot of their, uh, cost were stock based compensation. So there's some financial fuckery going on there. So it wasn't that they necessarily have a horrible business. It was just that they did some kind of weird comp stuff. But um, I mean, yeah, I, I mean, I wouldn't put money in the landscape, but that way kind of thing, but I don't know. It was just an interesting point that Jordan brought up with the, the VC hit rate has not like you can make a ton of money when you get to public, but I can't think of a big DTC cuz who, you know, like, so like it, it's not a

Jordan Menard (24:52):

Very, I mean like one of, one of the granddad's dollar shave, right? Um, when, when they, well that was no, but even the, no, but even when they were at 125 million a year, right before the Unilever acquisition, they still were profitable. Right. They still, they

Rabah Rahil (25:08):

Say even better. Yeah.

Jordan Menard (25:09):

That's your thesis, right. Hundred percent. And you also,

Rabah Rahil (25:12):

Yeah. Cause they had a

Jordan Menard (25:12):

Great percent and you look at some of like, uh, even like the, the acquisition of like movement, like the year over year they went backwards. Right. They, they got the money and then their sales went down. Um, so I'm not, I don't think I'm smart enough to truly understand why that hit rate is so low for, in, for VCs in D TOC. Yeah. Yeah. Um, but it is, it's just fascinating to me. Um, and then from my own anecdotal experience, um, it's the bootstrap folks that we work with that are really, that are the best. Like we we've just seen it like time and time again. Um, and I, I think part of it definitely has to be that discipline on cash flow management and resource deployment. Yes. It makes you a better operator in every way.

Ash Melwani (25:54):

Yep.

Rabah Rahil (25:55):

I couldn't agree more.

Ash Melwani (25:56):

Yeah. I was just telling Ron the other day, like I think it was last week during that whole fuckery Memorial day, like our CAC was like $5 above our KPI. And I was like, Ron, I, I feel miserable. Like what do we do? Um, so it's like, alright, we just had to drop the budget. Or like I was pumping out a new variation, the landing page with like a better deal, this and that putting up Memorial day banners. And it's just like all getting it back just $5 back to like KPI. And it's like, all right, well we're back. So I definitely, I, I, as a, as a bootstrap founder, I feel it and I'm always going to feel it. And like on a day where I'm like $10 under KPI, I feel like a God. And like days I'm like a dollar over, I'm like, I'm the shittiest marketer alive. So it's, it does play with you because it's it you're playing with your money. You know, it's literally your money that you're playing

Jordan Menard (26:45):

With that, uh, that feeling when you realize that, uh, you need to drop, spend to bring down CAC and stabilize is the worst. It's the worst. Um, it, it just stinks. We, we just went through that. It was like, you know, we're scrambling and <laugh> and people on my team that were like, you know, kind of starting to come up with these hail Mary ideas. And I was like, all right, guys, I, I, we're not gonna deploy. We're not gonna deploy that. Like, it's time to just take a step back, get it to stay that's when you know yeah. Stings.

Ash Melwani (27:16):

Yeah. That's funny. Yeah. So would that be said, I kind of wanna talk about like, I guess like ad structure and things like that for like high spend account. Yeah. You know, like I know you're, you're spending quite a bit, um, I guess take us through the process of like, for people who are like right here, but like wanna get to like here and then here, like how does, how does the media buying process change, um, at those different times for sure.

Jordan Menard (27:39):

Um, that's a, it's a great question. And I think, um, you know, one of those things is I think, you know, kind of a framework question, I is like, what is here, here and here? Um, right. Cause you talk to some people they're like, Hey, I'm scaling like, oh really? Like, yeah, I dude, what I'm about to hit 5k a day and you're like, oh, sick. You know, I think you kind of touch, not that nothing wrong with that there's levels to the we've all been, there's just, and we, we work with people who are trying to break that 5k day range. Right. So it's not like it, you know, we're only crushing and only, uh, spending huge. But, um, I really think there's something that happens around the 20 K a day mark, right. Going north of that 20 K per day, mark. Um, that seems to be the great beyond, right.

Jordan Menard (28:24):

<laugh> um, where, uh, rules just change like yep. Yeah, yeah. Like they, they just change. So I think, uh, one of the biggest things is I, uh, folks need to test a lot of creative, um, all the time. Um, I think one of the things that nobody thinks about when they're scaling is that as you break past that 20 K per day range, the life cycle for the creative starts shortening constantly. Um, so I, uh, one of the biggest, um, offers I've ever ran and I was personally running it. Um, I got the spend up to like 170 a day in one ad account, um, yeah. One, 170,000 a day. And, um, it was, it was crazy. Yeah, it was crazy. And so, um, the, the one, one of these days, I'll, I'll talk about that on stage, but, um, as we were pushing, um, something I noticed is super fascinating.

Jordan Menard (29:16):

We would launch an ad on, let's say Monday, and when you're spending, you know, over six figures a day by Wednesday, that same creative that was crushing on Monday would, would the cost would just start rising. And it's the weirdest thing, cause it's almost like you can see it happening by the hour. Right. So I think something that, that folks don't really realize is there is a very real structural obstacle on how are you producing and testing that much creative, creative. Um, so we have, you know, a single testing campaign methodology. Um, we are, we're a big fan of dynamic creative and we also test static, right? So we do both, um, depends on what the account is, how much creative we have. Um, what we like to think about is, uh, you know, we always test on broad, um, typically a, a CBO that we, um, every 48 hours or so will duplicate an adset swap out the creative publish, right?

Jordan Menard (30:07):

So we actually have someone on our team who's called a media builder. That's their whole job is duplicating. Adset changing out the creative, writing, new copy, new headlines. And what, how we like to think about it is we like to, to organize the adset at the angle level. Right? So whatever the high level angle and approach to selling the product is big fan of that. It's the best, right? We want to test that at the adset level and do that at least two, three times a week. Um, and then the more you spend, the more you need to test. Right. Um, so I think there are times where that changes, right, when let's say black Friday comes around, right. That's probably not the best time to test a bunch of creative aside from the new black Friday stuff you have, that's when you wanna really push.

Jordan Menard (30:52):

Um, but normally during that entire month, we're constantly testing creative, right. There are times where we're gonna really just accelerate budgets and push them. Um, but you know, we're constantly testing creative, so big fan of dynamic. Um, love the idea of like having, let's say you have one video and, uh, it's like an angle to a, you know, like let's say that, uh, you're selling soap, right. And the angle is the lather that the soap gets you and how satisfying it's right. The, the lather of the soap. Right. And so that's the angle. And so you have like three headlines and then you have one central video, but three different hooks, three different intros and maybe a couple body copies that have performed well, or you write something specific. And then we'll put that all in a new ad set and then let it run for two days, at least to really get that data, not cut anything too soon and then repeat and constantly just add.

Jordan Menard (31:44):

And so these single builder campaigns will sometimes have like 57 ad sets. Right. And in them, like, you know, five are on, right. Everything else is off and just five are on. And so we're just constantly running it. And that's one of the instances where we'll feed the budget, like the, the 20%, like every few days or, um, the more traditional scaling, um, budget approach. Um, and sometimes when it works, right, the creative testing campaign can actually be a really profitable campaign. Um, it actually produces really good results. And I don't think a lot of people realize that. So that's like the main foundation and that's the building block that you have to really get it to hit. Um, and so I think when you're doing it right, you can probably get that creative testing budget to like, you know, five, seven K per day, um, sometimes even more.

Jordan Menard (32:35):

And when you get it at that level, you're just constantly feeding the algorithm and finding new ways to, uh, you know, acquire customers profitably with new creative. Um, and then from there, I think the next structure we would have, we, we call it like the Roaz Royce. Um, it's a really, really simple CBO. Um, and it's just, <laugh> thank you. My, uh, my co-founder came up with it. Um, and so what we'll do, it's a CBO. It usually starts at about $500 and it's got one adset no targeting and all the best creative that we find in the builder campaign we're then gonna pull and add into that one ad set. So there, same model increasing the budget slowly, increasing the budget slowly 20% here, wait a few days, 20% here. Um, and building that one row as Royce campaign up while we're constantly adding new ads, I was just looking at one of these campaigns.

Jordan Menard (33:28):

It literally had over 80 ads in it and four were on, right? So over 80 ads, the winners that had been, um, identified in the creative testing campaign were then pulled into this. We call it like an intermediate scale campaign. Um, and we are, you know, watching how they perform. And what I find fascinating is like some creative will perform well at lower budgets when the ad set is still in discount bidding. Um, but once the breakdown effect really takes a hold of it, you realize that it doesn't have the legs to really scale like other creative does. And so that's why you get this ad set where it's one, you know, one CBO, one ad set, and then like 80 ads and four of them are on. Um, and you know, you, you can get that thing up to over 10, uh, you know, maybe 15 K a day, and then everything else like for remarketing, we're a big fan of just DPA, um, or no remarketing at all. Um, you know, we've, I think mm-hmm, <affirmative> something that's super interesting and I definitely in no way, want to go into the attribution debate, but <laugh> using attribution software. Um, we've seen that the reported Roaz for remarketing will be at like a four or five seven in Facebook and on last click in an attribution software, it's like 0.4, not exaggerating at all.

Rabah Rahil (34:45):

It's

Jordan Menard (34:45):

I know crazy percent. They don't believe you believe me. And then when you realize that remarketing is not only claiming purchases that happen via email SMS, stuff like that, but also claiming view through purchases, which a majority of the sales are, and they're not real, right. They're just not real. So,

Rabah Rahil (35:08):

Oh, Ash, Ash, everything, you're, I'm getting this tattooed. It's amazing different viewpoint from a third seat for sure, but, uh,

Jordan Menard (35:18):

Good to be among like minded people. Um, and so I think, um, once you have that kind of basic model down, and there's a lot of different variations that we see of this, this is just a very basic framework for the sake of conversation. Um, the next part of the equation in my opinion is like the coolest and the hardest to accomplish, but the most like dynamic. So like at Q4, we had one brand spend $149,000 a day in one day at like a 2.5, 149,000. That's

Speaker 4 (35:54):

Proper money.

Jordan Menard (35:56):

She 49 at 2.5 in 24 hours. Right. And so, and that was D TOC. The one I mentioned before was not D TOC, but that was, that was actually, um, a Shopify store. And so, um, if you look at the breakdown, right, you'll see the, everything that I just mentioned, all a few other campaigns and, um, of all the breakdown one adset has like over 30,000 in spend one single adset. Right. Um, and it was a big cap ad set. And so what I find fascinating about manual bidding is kind of the theory that we approach it with. I think a lot of people will look at big cap or cost cap, um, as a way to get a lower CPA. And that's just like, not what we do at all. Like, we, we don't even want that, right. We want the same CPA that we can put an infinite budget behind.

Jordan Menard (36:50):

And we, we anticipate it only spending 20% of that budget. So I kid you not like we <laugh> me and my co-founder were actually looking through the history, like the, the edit history of the adset on that day, cuz the numbers were so huge. And um, my media buyer who, I he's like one of the best in the world, if not the best, I know I'm biased, but like I've met a lot of them and this dude is just a freak. Um, and he had made like over 20 edits in that one adset in one day and all of them were just this toggling of bid and budget bid and budget. And so at one point the budget on that one ad set got to 150,000 daily. So the daily budget was one, 150,000. And at the end of the day, that one ad set ended up spending 29 grand.

Jordan Menard (37:38):

So the entire ad account spent, you know, a little over a hundred and that one adset is what pushed us up to the, to the next level at, um, just under one 50. And so, um, I call it the fire hose. It's like the ability to where you can just twist it and more pressure comes out and it just launches. Um, and when you do it right, it always starts in the morning. So you'll see it spending budget rapidly in the morning. And that's, that's when, you know, like you gotta write it and then you wanna just aggressively toggle that budget. As you're playing with the bid a little bit, watching the delivery, this is super risky, super unconventional. And I know there's probably a lot of Twitter gurus that are like having a stroke when they hear this. Um, <laugh> <laugh> but it's actually what we do. Um, it's actually what we do. And so that's kind of the basic structure that we're looking for for the really high skill accounts. Um, you know, a lot of it is hunting down for that perfect creative and uh, finding a bid cap or cost cap adset that we can really, really scale the budget to a ridiculous amount and anticipate it spending only 20%.

Rabah Rahil (38:49):

Just the names alone were fantastic.

Jordan Menard (38:52):

Yeah. That's let's how you know we're nerds.

Rabah Rahil (38:54):

Um, that's it, baby? Uh, I have a question. What's your take on exclusions?

Jordan Menard (39:02):

Um, so I'm gonna be a hundred percent honest with you. Like I love just no targeting at all. No exclusions, just let it bang. And

Rabah Rahil (39:13):

Brother, brother

Jordan Menard (39:15):

Customer, well, brands will tell us, they're like, well, we wanna focus on new customers and I'm like, agreed, but don't you think those new customers will love the social proof of all the previous customers and the comments being like bought this love it. Amazing. Right. And that's what happens when you have a really good brand that runs that no exclusions. Now, if we're really, really, really focusing on new to brand customers, we will experiment with that stuff. Um, we, you know, we'll exclude all the way down to Clavio list, video viewers, stuff like that. Um, but if it was up to me, I would just let it bang and keep a really good eye on that new customer acquisition cost

Rabah Rahil (39:50):

That that's, that's how I

Ash Melwani (39:51):

Saw. Have you done the test between the two?

Jordan Menard (39:54):

I don't think I can

Ash Melwani (39:56):

You seen there? Cause I, I exclude customers. Yeah. Like just through Clavio list, like, but I, at certain point I didn't even do that, but the reason I was excluding is just because like first time impression ratio was going down, but I feel like even when I do exclude that goes down. So it's like, does it really do

Jordan Menard (40:13):

I, I agree with you. So I don't have a, anything with statistical relevance that I can confidently say one is better than the other. It's purely anecdotal, but from all of my experiences, it most definitely seems that not having exclusions will not only make that ad set like perform, but well, but it doesn't really, it doesn't give you that difference in new customers that you would anticipate it doing. Right. It just doesn't seem to do that. Yep. Um, I think first, you know, I, there is a time and place for it. We have it in, we have it deployed in a lot of accounts. We exclude customers from a lot of accounts. Most of our brands tell us that they, they want to do that. Um, and maybe I could be wrong here. Right. I I'm very open to that, but that's kind of how I feel about it.

Rabah Rahil (40:59):

Uh, when I was running my agency, the only time I'd use exclusions would be if I was running remarketing for the, um, brand, like if it wasn't remarketing, I was just wide open. Like you said, I think there's the other thing too is you can get to a point where you start to cock block and you're just like, your deliverability just starts to drop because like their Facebook just pull, takes the hands off the wheel. Hey, Hey, I can't find anybody. I think all these people are need to be excluded and then it's like, okay, cool. So what's the point? Like I, I don't know. I'm uh, I'm very much of your, your same, same mind Jordan. I, I think that that's how I, I see it as well.

Ash Melwani (41:35):

Do you guys think it helps with retention if you don't exclude

Rabah Rahil (41:41):

Say that a different way?

Ash Melwani (41:42):

Like if you're not excluding customers, they'll still, there's a chance that they'll probably see these ads continuously, um, to a point where if they are

Rabah Rahil (41:52):

Eventually

Ash Melwani (41:53):

Drop out, come back,

Rabah Rahil (41:54):

They'll eventually drop out if they're not buying or interacting, especially if we're out broad, like it gets into a weird place. If you're in a small audience and you don't have exclusions on because you only have X amount of people to hit. And so this like, oh, this person has a high probability, but even if a person has a high probability, if they're constantly not engaging with the ad, they'll drop out. Especially if you're at like how Jordan's running it, where it's basically open and broad. Like there's so many people that the, that can enter that targeting pool that eventually these people are gonna either engage with it, which is to Jordan's point adding social proof, which is fantastic. I'll pay for that all day. Um, or they're not, and they're just gonna naturally drop out and become an exclusion because they're not gonna buy. So I dunno which

Jordan Menard (42:36):

That's a super fascinating question and one that's definitely worth considering. Um, I would say that's probably like one of the more intriguing arguments I've heard for exclusions. Um, I think some people could be ignore annoyed by that, but also I think if you guys test new offers, um, and someone came in at a higher price point, that could be reason for them to be like, well, what is that man? Like you, you know, you don't care about the people that already purchased. Um, so I think that's an, that's an intriguing idea. Um, I don't have, um, like I don't think I know enough to really, uh, speak on it, but, um, I would be curious to, to hear from someone who really have you guys experienced that, like it, you think that there's a correlation with retention or LTV with, uh, exclusions.

Ash Melwani (43:26):

So last year when I wasn't testing. So now that I'm thinking about it, I think this makes sense last year when I wasn't testing a lot and I was running the same ads, um, our daily sales were more closer to like 50 50 on new and old when I excluded customers, CPA increased a shit done. Um, but then obviously the, the balance was all right now it's 30% retention and 70% new. Right. But if I'm constantly testing new creatives with, without exclusions, maybe I don't know, do you, I feel like maybe that wouldn't really matter cause it's still hitting different pieces of the audience versus just hitting customers. And then I guess the social proof on the new creatives would also help too. So I'm not sure. I, I really I'm just actually tested next

Jordan Menard (44:22):

<laugh> I'm, I'm actually in the same boat. Um, that, that, that is something I want to deploy. And I think there's ways that we can measure it now, um, that are, are pretty intriguing. That's something I love about attribution software with triple and north being is the ability to see, uh, the new customer percentage down to like things like, like percentage of traffic, right? Like what, what a drove the Mo the most new to brand site visitors. Um, and I think when you have those, those tools, it becomes extremely useful for things like you're talking about. So this is something I wanna deploy as well to be transparent.

Ash Melwani (45:00):

Well, one also one other statistic, right? How does, how does frequency play into, um,

Jordan Menard (45:07):

Versus so, so I think something that's interesting about frequency is we don't know who, like, let's say your frequency is 2.7, right? We don't know if that's returning customers or new customers seeing it 2.7 times, right. It's just a number of 2.7. So we, we don't know like, are, are, is this the people that are already a customer that are seeing it this much, or is someone seeing the ad and then Facebook's remarketing to them with that same campaign because they haven't purchased yet. Right. So I, I think, you know, obviously we keep an eye on frequency, but I don't put a lot of like weight into it. Like we have one, we have this one campaign, the frequency is literally seven and, you know, the, the brand has been like, that seems ridiculous. And our response is like, yeah, it does. Uh, but it's working right. But it's working. So like what, what, what should we do? Yeah. And so, because I think it is hard to quantify how that frequency is realized question,

Ash Melwani (46:06):

Is that, how much is that? How

Jordan Menard (46:07):

Much are we spending on that per day? Um, not a whole lot, probably around a thousand on that, that specific asset.

Ash Melwani (46:20):

So the reason I ask is, so I'm curious about that versus the higher spending accounts, where if you're spending 30 K a day, is Facebook forced to go and find new people versus like there's a certain limit of within that audience of like that person being on Facebook throughout the day, like the frequency can't go higher than the amount of times somebody's on the platform. Right. So go, it has to go and force itself to like find new people. So I'm wondering if at lower budgets, frequencies is typically higher because that's right. Low hanging fruit, the lower bidding, you know, as well. So I'm just curious if frequency kind of,

Jordan Menard (46:56):

Yeah. I mean, I think in a lot of ways it does, I think keeping, keeping an eye on something like, um, first impression ratio would be more valuable, right. In that, in that instance, it would be more valuable because it's letting you know, like how often are we reaching new people? Um, but I think, you know, of all of that stuff, I think what's really most usable is stuff like looking at, uh, new to brand site visitors. Right. Um, I think that's gonna be the thing that's like most useful. Um, I'm more interested in that than any of the, the platform metrics that we're talking about. Um, but yeah. Um, it's an initial question. You said a lot of things right there that, um, are really sort of making me think I'm not gonna lie.

Ash Melwani (47:37):

<laugh>, that's

Rabah Rahil (47:40):

Why I'm being Ash. Yeah. Pulling your white today. I love it. Um, alright boys, we're pushing up against it. Actually. Wanna start doing something new, I wanna, uh, ask you guys a totally random question and get your thoughts on it. So, um, what's taking over the TikTok universe right now is 0% ad related, by the way, it's total, just me being a, a douche bag, wanting to have your guys' input. Um, do you think there's more doors or wheels in the world? I'll start with you Jordan, and then I'll go to you, Ash.

Jordan Menard (48:07):

Are you, are you team

Rabah Rahil (48:07):

Wheels or team doors? Jordan?

Jordan Menard (48:09):

Yeah. I've uh,

Rabah Rahil (48:09):

What's more in the

Jordan Menard (48:10):

World. This is deep and it's not the first time I've been asked. Um, so,

Rabah Rahil (48:16):

Ah, dang. I thought I was old kid.

Jordan Menard (48:19):

My wife actually, uh, asked me, saw it on TikTok. Same, same thing. Um, yeah. Um, the TikTok team, honestly, man, I'm gonna guess doors. Um, yeah, I'm gonna guess doors. Oh yeah. I'm gonna guess doors for sure. Um, yeah, my, my only thought is is that, um, you know, you have instances with, uh, stuff like skyscrapers where there's so many, so many doors. I was just horrible, you know? And so I, I would guess that, but um, you know, maybe I need to smoke a little bit more before this question. <laugh>,

Ash Melwani (48:58):

<laugh>

Rabah Rahil (48:59):

Get, get into more, more amenable state of mind. Yeah. Amazing. Yeah. Which is legal where he's at kids. We, we don't promote illegal activities here. Um, Ashani, are you team door or team wheel?

Ash Melwani (49:13):

I think I'm team wheel. Um, I mean to Jordan's point. Yeah. You have skyscrapers, but I mean, every single car has like, or even the regular car has four doors, four wheels, but then you got the steering wheel, right?

Rabah Rahil (49:26):

Well, not only in those, in those big skyscrapers there's office chairs, which have five to six wheels per chair,

Ash Melwani (49:35):

I think I'm wheels, to be honest,

Rabah Rahil (49:38):

I think I'm team wheels. I do like the skyscraper push back though. I do. And I'm glad we didn't all, all, all have the same answer, but anyways, stay

Jordan Menard (49:44):

Tune, to be honest, I think now if I had to bet money on it, I probably go wheels <laugh> I literally

Ash Melwani (49:49):

Didn't even,

Jordan Menard (49:51):

I didn't even think about the, the chairs I'm thinking about my office and I'm like, oh, my office has like seven doors in here as I'm sitting on five wheels. Like, so

Rabah Rahil (50:08):

Jordan, you're such a gem dude. I can't wait to meet you. So

Jordan Menard (50:12):

You're coming to coming to bar. Um, yeah, I'll stop by geek out. Not speaking to geek out, just coming to speaking, hang with the people I personally think geek out probably has one of the greatest communities in digital marketing that's ever been established. I love the people there. Like it's just my tribe. Like I, I just feel it. Um, I absolutely love what James and Nick have built. Um, I've taught at a ton of GeekOuts. Um, and then I'm, uh, speaking day, one main stage at affiliate world and I'll be on the panel. So, um, yeah, I'm, I'm excited. I've never done affiliate world and uh, hopefully I can bring some heat, but uh, we'll see.

Rabah Rahil (50:50):

Oh, after this podcast, I'm sure you will. Um, are you guys taking clients? How can people work with you? How can people follow

Jordan Menard (50:56):

You on Twitter? Yeah. Um, Twitter, uh, Jordan arm Menard. Um, we're taking the right clients. Um, if you're a good fit, um, yeah. Uh, motif.digital. Um, just go through there, fill out the type form. Um, you know, we, we do, uh, we pretty much do everything. Um, we make creative, um, we buy ads on Facebook, Instagram, TikTok, Google, YouTube, Amazon, um, whole nine. So, um, yeah, that's, uh, that's really pretty much it, man. Um, love Twitter. That's probably the best place to connect with me. Um, and it's just at Jordan Armard iron

Rabah Rahil (51:31):

Beautiful, great feed. By the way, you've been really, uh, dropping some, some heat of light. And I I've been really appreciative of it. Cuz you got that big old brain. We gotta get more, more of your content outside. Thank you sir. Into the hands of the people, ask Milani, tell the people about your mentor pass, tell people, go to vitamin shop, you know the thing, get it done. Yeah.

Ash Melwani (51:50):

Yeah. Um, mentor pass just past, uh, 10 sessions, which is really good. Um, the reviews are coming in. Reviews are hot. So if you need help with a little audit in your ad account, some, uh, processes to be put into place with your current organization. Let me know. I really like piecing those things together. Um, following me on Twitter Ashvin Melani and um, if you are in the neighborhood with a vitamin shop, please stop by ask 'em where the Avi is and send me a picture.

Rabah Rahil (52:20):

Thank you. Can send me a picture, dude, dude, the damn thing people. Um, if you want to get more involved with triple well, we are try triple well.com. We're on the bird app at triple well, and I am also on mentor pass. If you wanna support my ridiculous sneaker habit, I am taking mentor consults and a hundred percent of the proceeds will go towards my new sneakers. Jordan. Thanks so much again, brother. I really appreciate you taking the time Ash. You're Jim. We'll see you. Oh yeah. We're actually coming to New York, June 22nd for a triple whale road show. Um, so, uh, Ash will get something together, but uh, yeah, if you guys want to see me Ash, uh, we're actually bringing a bunch of people, our director of web strategies in Boston, Alexa, head of brand Tommy head of social. There won't be a bunch of people like at all these, but New York is just an easy one for us to go to.

Rabah Rahil (53:10):

So, uh, we'll be in New York in June 22nd and then Toronto LA and then, uh, what's I always forget the third one London. Um, so those dates will be announced shortly, but June 22nd hit us up. Uh, and then if you are in Austin, June 18th, um, there's a really cool dinner that Shaq's put it on. Let me know if you wanna invite, if you are a really awesome brand guys. Thanks so much. That's it? That's episode 12 in the books, Jordan, you're a gem. Appreciate your brother, Ash. We'll see you on the flip. Uh, thanks for tuning in everybody. That's all we got.

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