April 29, 2025 • 42 mins
In this episode of the Unstoppable Marketer Podcast, hosts Mark and Trevor discuss the crucial difference between efficiency and effectiveness in marketing strategies. They explore how focusing solely on efficiency metrics like ROI or CPA can hinder business growth, especially during challenging economic times. The hosts emphasize the importance of balancing efficiency with effectiveness, urging marketers to consider long-term profitability and customer retention when making decisions about ad spend and scaling.
Please connect with Trevor on social media. You can find him anywhere @thetrevorcrump
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
if you can just zoom out of the situation you're in,
you will probably make waybetter decisions.
But in COVID everyone shut adsoff without thinking for two
seconds of oh, everyone issitting at home on social media.
Speaker 2 (00:12):
Yeah, like this is the best time to actually run
ads.
Speaker 1 (00:15):
Ads are crushing.
Why are we going to turn themoff, Like just because of the
quote?
Uncertainty of buying behavior,buying behavior over time.
Well, it's like it is what itis until it isn't.
Speaker 2 (00:26):
Yo, what's going on, everybody?
Welcome to the UnstoppableMarketer Podcast.
With me, as always, is MarkGoldhart.
What's up, Mark?
How are you, sir?
Good Goody, good Goody, goody,here we are, here we are Tuesday
afternoon.
I'm actually excited about whatwe're going to talk about today
(00:47):
, personally, so I'm excited forthe episode.
Yeah, yeah yeah, any news.
The Pope died, you see that.
Speaker 1 (01:00):
Yeah, the Pope died.
Watch out for whoever JD Vancevisits next.
Speaker 2 (01:07):
I watched a whole like I had no idea how they
select the next pope you did notknow I had no idea.
Speaker 1 (01:14):
Oh, it's pretty yeah, they all get locked in a big
giant chamber and it's likeassuming there's some toilets in
there, though black smoke.
Speaker 2 (01:22):
If it's, if they've come to this decision or no, if
they haven't.
If they haven't, white smokecomes out of the if there is
chimney, if there is yes I don'tknow.
Speaker 1 (01:32):
That's a good question I mean it's in a lot of
movies.
Producer asked if it was insherlock holmes, it's there.
There was a lot to it, it'smore than just the top cardinals
and I don't know how manycardinals yeah go in.
I think there's a hundred and Iactually think I do know the
number.
I think it's like 140 Cardinals.
Speaker 2 (01:52):
Well, that's news right there.
Speaker 1 (01:54):
I should look it up really quick.
Speaker 2 (01:56):
Also other news.
I saw Trump signed an executiveorder to this one's awesome.
Personally, as somebody who'shad kids before, there's nothing
worse than like getting thebill.
Speaker 1 (02:12):
Only 135 Cardinals.
You said 140?
.
Yeah, nice Are eligible to votein.
It's called the Conclave.
Speaker 2 (02:20):
Yeah.
Speaker 1 (02:22):
And crazy.
They released a trailer for amovie called, I think, the
conclave.
Speaker 2 (02:25):
Really no social.
No phones can be there.
No, nothing like they're.
Speaker 1 (02:30):
They're legitimately cut off yeah, like they are in
there debating and I don't knowhow long it lasts, like I wonder
, and to be fair, I'm notcatholic, so I don't know if
debating is the right word, butyet, yes, they have to come to a
consensus.
Deliberating deliberating,that's the word I'm looking for,
not debating so I think there'slike each, there's like a few
(02:51):
sects that like bring forth,like maybe like the person they
think.
Yeah, I'm sure it's not likeeveryone is like I'm the pope,
yeah, vote for me.
I wonder if it has to beanonymous.
I don't know.
I'd be really interested tofind out, though.
Yeah, I mean, that's a personwho I mean.
What is there?
Close to a billion Catholics?
(03:12):
I don't know how many Catholicsare there.
Speaker 2 (03:15):
I don't know that's a lot of people.
Speaker 1 (03:18):
It's an important world figure.
Speaker 2 (03:20):
Yeah, that's a very important world figure.
I'd probably say one of the,you know, at least one of the
most well-known world figures1.4 billion.
Catholic or not?
You know, everyone knows whothe Pope is, wow.
The other thing I was saying isTrump signed an order.
I heard where you know how yougo to the hospital.
You have a baby for exampleyeah.
(03:41):
And you have no idea what thebill is going to be.
Ugh, nor do have a baby, forexample.
Yeah, and you have no idea whatthe bill is going to be.
Oh, nor do you like when youget the bill, nor is it like
itemized as to what it is.
Speaker 1 (03:48):
It's just like you owe 12 grand, yeah, for having a
baby, you're like well, what'salso a joke about it is they
don't tell you what theinsurance like, because if you
pay in cash it's often cheaper,sure, but then it won't count
towards your deductible.
But for some reason, you haveinsurance like, sometimes, if
you do have a high deductible,it's more expensive than if you
paid for cash.
It's like a total mess and youdon't know why or what.
(04:11):
Like you said, it's very like.
The itemization is oftenstrange.
Yeah Well, trump signed anorder.
Doesn't make any sense To saylike before you leave.
Speaker 2 (04:18):
You have to know exactly what it is Like.
You have to know exactly whatit is Like they have to tell you
.
This is what it's going to be.
Speaker 1 (04:23):
Oh, so you don't have to wait for two months and it's
not an estimate Like this willbe between six and 10 grand.
Speaker 2 (04:28):
This is the bill.
You must know, and what it isand why, which I think is
actually really cool.
Speaker 1 (04:33):
I wonder what that does to price action for medical
care.
So Hopefully it simplifies ityeah.
It's a waste, maybe too Likecause I always feel like I
remember how much I paid for myfirst kid, because they, for you
know, maybe shame on me cause Ididn't go through all my
insurance documents, but wethought like the extended stay
(04:57):
was covered.
Uh but then it wasn't Ouch.
So we were there for two daysor three days, but each day is a
lot of money.
Speaker 2 (05:09):
I after the first kid our next two.
I was out of the hospital.
Speaker 1 (05:14):
Like as soon as possible, right.
Speaker 2 (05:16):
This.
People are going to get mad atme for this.
But like I over pushed, almostlike my wife, like let's just
get out, like I will take careof you at home, as long as
everything's fine.
Right, the birth went fine.
As long as it's like, just likea baby's fine Wife is fine, you
know, because it's just likethere was nothing more miserable
than sitting there and my wifeand I are not people to be
(05:36):
waited on, you know, so thatthat part of the hospital was
not beneficial for us.
Right To have that baby takenfrom us so that we can get some.
You know, it was more like mywife wanted the baby or I wanted
the baby, right?
So if I need to sleep, she hasthe baby if she needs sleep, you
(05:57):
know.
So we were like one day andjust like let's get out of here
as quickly as humanly possible.
Speaker 1 (05:59):
I don't, but I just hate hospitals.
So I do have to say it is notfun, no, but I think, look, we
had a good guy on our, we had agood guest a while back.
I want to read something thathe posted.
His name is Preston Rutherford,very prestigious name.
Speaker 2 (06:17):
Oh yeah, co-founder of Chubbies.
Co-founder of Chubbies the swimtrunks.
Speaker 1 (06:21):
That sold for, I believe, over $100 million right
yeah, I believe so, so youcould say maybe he knows
something about growingbusinesses, right?
Speaker 2 (06:32):
I would say yes okay so shout out, preston, you're
gonna paraphrase this right,because normally these things
are like yeah, I'm gonnaparaphrase it, but I'm.
Speaker 1 (06:42):
But I'm opening up the post because I do want to
credit him, because we've beentalking about something like
this a lot and it's somethingthat you should be talking about
, depending on the goals of acompany.
Speaker 2 (06:54):
We're wearing the same pants today, just a
different color Shout outStandard Issue.
Yeah, look at us.
Speaker 1 (07:01):
The Resort Collection Limited limited, limited run.
We didn't make these ever again.
Speaker 2 (07:03):
Look at us the resort collection Limited, limited,
limited run.
Speaker 1 (07:05):
They didn't make these ever again.
So look what Preston does onLinkedIn is he has these pretty
helpful conversations that youknow these.
What do you call it Likerole-playing conversations
between a CFO and a CMO?
Yeah, it's generally between aCFO and a CMO yeah, Sometimes
it's the CMO and the CEO.
Correct, yeah, between a cfo anda cmo.
Yeah, sometimes it's the cmoand the ceo, correct?
(07:27):
Yeah, and the what he, what hetalks about in the one that
resonated recently because we'vejust had this conversation a
few times yeah, is it'sbasically the cfo is saying hey,
our row as our roi ourefficiency metrics are down are
down or you know whatever, andthey're know he's getting after
the CMO.
and the CMO has to kind of gothrough this dialogue of saying,
(07:49):
well, yeah, but if all you'refocused on cause like efficiency
, the line that I grabbed fromit is efficiency is not always
effectiveness right For yourcompany, totally so.
If you're incentivizing yourmarketing team to go after
efficiency, they will, butthat's going to include a lot of
(08:12):
stuff that's not growing yourbusiness in the way that you
might want to be growing.
Speaker 2 (08:17):
Right.
Speaker 1 (08:17):
Some businesses don't want to grow like that, and
that's a totally differentconversation.
Right, like you have differentgoals for different kinds of
businesses, but efficiency isnot effectiveness.
Right, like you have differentgoals for different kinds of
businesses, but efficiency isnot effectiveness, right?
Right, it doesn't mean theydon't overlap.
And it doesn't mean you shouldlook at efficiency, depending on
what your business is and theshape of your business and the
unit economics and so on and soforth.
(08:39):
But the conversation basicallyis cool.
Well, if the goal is to growand the company wants to grow
from X to Y to Z, then we cannotbe focused on efficiency.
We have to be focused on growthand you know unit economics and
(09:01):
how you can actually.
You know economics of scale,unit economics and how you can
actually.
You know economics of scale,like how do we get to this place
together?
But we have to come up with anew unit, right, or kpi, of what
success is.
Sure that incorporates someefficiency into it, but if all
you care about is thisefficiency number that got you
to where you are now, it's notgoing to get you to where you
(09:22):
want to go.
Yeah, right.
So, like you have to readjustyour frame of thinking.
Yep, If you go from let's justmake up some arbitrary numbers,
right.
If you're a seven figure brandand now you're an eight figure
brand, right, hey, that's great.
Yeah, but if you want to be, ifyou want to go from 10 million
to 50 million, a cpa of 80dollars might not get you there
it's probably not going to getyou there and maybe it doubles,
(09:46):
or maybe it increases by 50percent or yeah.
So you got to think about itlike you're pushing up against
not only like more competition,but total obtainable markets.
Now, instead of having your uh,like, your penetration into a
market being like organic wordof mouth, possibly, or your
(10:07):
organic social, it's now goingto be more ads that are
introducing people to your brand.
Speaker 2 (10:11):
It's going to be at a higher scale at a higher scale
yeah, yeah, you still might havethe organic, so let me give you
a good example.
Speaker 1 (10:17):
So naturally, efficiency is just going to go
down.
It is what it is and, yeah, goahead.
Speaker 2 (10:21):
I'm going to give you numbers.
I'm going to make them lessexact and a little bit more
general, but this is a client ofours.
Nobody's going to know this, soI'm not giving out who it is
and what, but we have a client.
We use a metric called thereturn on contribution margin
dollar, which is essentially,for every $1 you spend, what is
(10:46):
your profitability, based off ofvariable costs?
So variable costs meaning likerevenue minus cost of goods sold
, minus shipping and and adspend Correct.
So not looking at like yourOPEX, right, we oftentimes will
look at this metric.
So when we first started withthem and we do like to include
OPEX.
(11:06):
Of course, yeah, OPEX is awesome.
Of course.
You know, obviously, Becauseyou got to know.
Hey, what do you need to makein order to stay in business?
Speaker 1 (11:12):
But OPEX tends to grow as you grow.
A little slower, sure A littleslower, sure Than the variables
do.
Speaker 2 (11:18):
Yes, absolutely.
Speaker 1 (11:19):
Well, yeah, generally it's a little more.
Speaker 2 (11:21):
It's like a little more constant, if it doesn't,
then you're probably not doingOpEx right, yeah?
So when we first started theyhad like a seven.
I mean it was awesome Like theywere crushing it, and it's
because they had their cost ofgoods sold.
Their margins are unreal, likeunreal margins.
Okay, they were like a six or aseven when we first started,
but they were making like$30,000 to $40,000 in overall
(11:46):
profitability, not revenue.
I'm talking at the end of theday.
After all's said and done,we're profiting $30,000 to
$40,000 a month.
Okay, rewind or fast forwardmaybe 12 to 18 months later.
Their return on contributionmargin dollar is like a 2.5 or
three.
Okay, so significantly less,which means that their CPA went
(12:08):
from like $30 to like 70 orsomething like that.
Okay, and I might be gettingthat off.
It doubles essentially Okay Inin most people's mind.
If we're looking at efficiency,that cfo is like whoa, bestie
media.
What are you doing?
Pump the brakes.
Speaker 1 (12:26):
You're nuts like our cpa, has gone from you are doing
it all wrong.
Speaker 2 (12:32):
10 to 70 or whatever, right, yeah but when you go and
look at what their overallprofitability is on the month,
they went from 30 40k to like200 300k yeah, they're profits,
profits.
Speaker 1 (12:48):
So yeah, they, they went from it's a forty thousand
dollars in profits to over twohundred thousand.
Speaker 2 (12:54):
What a massive mistake that would have been by
the cfo if they would have saidstop what you're doing right now
.
Speaker 1 (12:59):
Because efficiency looks bad.
Speaker 2 (13:01):
Because look how inefficient we are.
Yes, and that's what Preston'stalking about is efficiency
doesn't always mean it's themost effective thing to do for
the business, yes, or the mostprofitable thing to do for the
business.
Speaker 1 (13:13):
Now, by the way, we're not advocating.
Sometimes it is necessary,depending on what your product
and industry are, but for mostit's not necessary to lose money
on your first customer.
But what we are saying is,depending on your growth goals,
you need to consider not makingmoney.
Sure, so like, approximateprofit for your first customer,
(13:36):
you know might not be what youthink it should be.
Yeah, because you have to startlooking at things as hey, what
is?
I know there's a lot of hottakes out there, but you do.
You have to look at things aswhat's your LTV right?
What's your returning customer,and then you can create a game
plan off of that.
Speaker 2 (13:55):
Totally.
Speaker 1 (13:57):
And we're not saying that you have to look at a LTV
of 365 days out of each cohortand yeah, I mean you can
literally do it that simple.
It's like hey, here's my cohortanalysis.
What is my average return?
Yeah, over four months or threemonths, maybe it's 90 days,
maybe it's 180 days.
I don't know what your cashflow situation looks like.
So, depending on you, yourcompany, yeah, you'll, you can
(14:20):
adjust it and that's a reallygood thing.
Speaker 2 (14:22):
I'm glad you said that, because one thing because
you're gonna have some peoplewho are gonna be like well, my
cash flow.
Of course cash flow.
Sometimes you don't have theability to lose the way that you
could in the early stages, fromthe most effective way to
market, so that that is onething right.
There's a cash flow issue.
That can always happen, so weget that, but barring that,
(14:46):
efficiency is not alwayseffectiveness.
Speaker 1 (14:54):
It's one variable amongst many.
Speaker 2 (14:58):
The way you should look at efficiency, if I may, is
that should help you understandhow to better Tactical, how to
better optimize your tactics,not meeting like okay yeah yeah.
We put it on a bunch of new adcreative.
Was that?
(15:18):
Was that the ad creative thatmaybe did this?
Or is it just the sheer factthat we are getting to larger
numbers and so effectiveness isgoing to go down?
So I think you look atefficiency to help you with the
levers that you're pulling, butit doesn't necessarily mean that
you say let's, let's ask whatwe're doing, let's decrease
(15:42):
spend, let's drop it all downbecause, because it's- not
efficient, like the way it wasExactly.
Because I guess I mean we'veseen it enough with our clients.
Speaker 1 (15:50):
Because, again, the thing about the efficiency is
often what happens is you'll seethis, this scaling effect right
, like all of a sudden you startcapturing low-hanging fruit,
like you scale up, things looklike they're going really good,
but efficiency will start goingdown yeah and things are still
going good.
(16:10):
If you're looking at profits andif you're looking at certain
metrics, so it's just like, hey,what are you going to
prioritize?
Like, if you want to prioritize, you know a 30 cpa if that's
what you were getting, but nowit's going up, yeah, but if
you're getting the right kind ofnew customer into your mix,
where your profits are growing,yep, then you know it is what it
(16:34):
is.
Speaker 2 (16:34):
I'm going to make a but, if you don't want to scale
totally different conversation,I'm going to make a bold
statement Brands that that maketheir CPA their lead metric
always fail.
Oh yeah, over time, over time,always.
It's not only have we seen it,we've seen it with dozens of
businesses that we've workedwith.
(16:55):
This is actually the number onereason a client leaves us.
If I can get this transparent,this is actually the number one
reason a client leaves us.
If I can get this transparent,the number one reason a client
leaves us is because there'sthis disconnect and maybe
there's a shame on us for maybenot being able to educate and
articulate a little bit better,which I think we generally do
pretty good at, but it isoftentimes one of the number one
reasons is when that starts togo up.
(17:16):
Yet things are still going goodfrom a profitability
perspective.
There's this chokehold struggleto give that metric up or a
little bit more grace, and whathappens is oftentimes those
businesses will leave, will partways, and six months to 18
months later.
Speaker 1 (17:37):
They're always going down and they're going down fast
.
We use a tool called Particleand we can look it up months to
18 months later they're alwaysgoing down and they're going
down fast.
Speaker 2 (17:40):
We use it, we use a tool called particle and we can
look it up to see how people aredoing and it'll it'll show us
revenue, it'll show sales andand they're headed down.
You know, or we hear from theinside somebody saying, hey, we
wish we, we wish we would havedone xyz, it happens all the
time.
Speaker 1 (17:56):
Or sometimes they come back yes, and say hey, they
they prioritize efficiency asthe lead metric.
You just can't grow.
When you do that, you're notgoing to grow.
No, I mean, I think the hardtruth in marketing is the
company that wins is the companythat's willing to pay the most
for a new customer.
Speaker 2 (18:15):
And the company who has balls.
Speaker 1 (18:16):
And can pay the most.
So, they're like again's opexthings here, like we're not
saying run yourself into theground, just going getting a and
being done.
Five roi on a new customer butwe are saying that you got to
zoom out like what's your goalslong term, short term?
You know what is the priorityfor your company.
(18:38):
If it is profit, over timewe'll look at compounding
effects of of new customers onyour business.
Um, but yeah, if you're notwilling to like someone else is
yeah, period.
Like someone will try to paymore than you A thousand percent
and that company will win.
So you got to figure out how toa charge more.
(18:58):
Bundle right, get more out ofyour customer to justify certain
kinds of costs to acquire themYep or what Expand it Like.
What's the window that you'relooking at?
Is it month zero to month threein a cohort analysis?
Is it month zero to six?
Speaker 2 (19:14):
Or start doing things like if you can't increase AOV,
like you were talking about, orincrease conversion rates, then
you have to find a way toincrease your traffic outside of
just paid, which is oftentimesorganic right to make that
dollar go further.
So, rather than you having toreach 20 million people in a
month to generate x amount ofsales, yeah, um, paid, maybe you
(19:38):
can reach 15 million, and youknow paid and 5 million
organically, you know anythingto eat into that as well.
Speaker 1 (19:46):
Yes, which, again, like you should be doing all
those things, but like,ultimately, like you're not.
If you're trying to grow atcertain types of velocities,
like you're just, you just can't.
You cannot expect to have thesame CPA.
So if you're working with anagency or you have a media buyer
on your team, whoever you'reworking with, like I'll bet that
(20:09):
most people who listen to thisare guilty of prioritizing ROI
to the point where it iseffectively handicapping them
from growing their businessAgain, growing their business in
a profitable way.
A thousand percent said, ittakes guts because there is this
(20:29):
.
There is this point where everycompany gets where it's like
they see growth but it's like,oh, it's a little harder now.
It's like, yeah, guys, guesswhat?
Like if it was so easy to justspend more money and make more
money at the same efficiencyrates as you were when you were
(20:49):
a small business.
Everyone would do it, everyone.
Everyone would have a hundredmillion million brand right now.
Speaker 2 (20:54):
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Speaker 1 (21:47):
Everyone would be Ridge wallets right, like
everyone would.
If it was that easy, then justspend money like cool.
But it's hard for two reasons.
A, yes, like you do have tofigure out what profitability
marks at what point in thecustomer purchase cycle or
journey work for you.
Uh, the other hard part is whatyou mentioned earlier is it's
(22:09):
scary, totally, and and mostpeople don't.
What we have seen is mostpeople don't fail because they
all of a sudden?
are so unprofitable that theycan't function Right.
We see most people fail becauseit's just so uncomfortable.
Speaker 2 (22:27):
They pull back and what ends up happening is their
profits start to become lowerthan their OPEX, then they have
to start firing, and then whathappens is they don't have the
manpower, pos and marketingdollars to then scale back up.
Yeah Right, so there, and andthis all hits even this hall
(22:49):
hits 10 times harder.
I actually don't even this isnot what we were actually going
to fully talk about today.
I actually don't even this isnot what we were actually going
to fully talk about today.
I actually don't even think wego into what we were going to
talk about today.
Let's save it for anotherepisode, because I think that,
like this is actually superimportant, and I can go on for
like 15 more minutes with this.
Speaker 1 (23:03):
Yeah, we can talk about it another day.
Speaker 2 (23:05):
So when times get harder, aka right now, I would
deem now as a hard time for tworeasons.
One, we've had economicuncertainty for the last three
years.
Well, for a while, yeah, right,yeah, now, even more so for the
last few months.
(23:25):
Okay, and then you add tariffsto that, which makes it even
harder for businesses.
So let me give you four datesthat have happened in the last
six years may 2018 what happenedin may 2018 was the pay-to-play
model that meta put out.
Speaker 1 (23:44):
that's when it, like, really kicked in meaning yeah,
when you say put out, it's justthat's when.
That's just like may 2018, whenthe algorithm was no longer
chronological, like you weren'tgetting shown to your followers
the same way we would postsomething and we would make yeah
, we would make 10 grand thatday from a post, not even ads
and then all of a sudden, andthen overnight in may.
Speaker 2 (24:06):
I can't remember the date in may, but I know may 28th
, may 2018, because I waslooking at analytics, google
analytics.
Okay, that was a time thatfreaked everybody out.
And what did a lot of brandsstart doing?
Pulled back, pulled back onspend because they were no
longer getting the efficiencyfrom the organic that they once
were.
So, and what happened is, yousee, a lot of people who went
(24:27):
under between 2018 and 2019 yes,okay, well, and, and that was
the so.
Speaker 1 (24:36):
So what I want to emphasize here is what happens
when your cpas go up as youscale.
A big part of that oftentimesnot every time, but oftentimes
depending on how how good yourorganic was before but but it's
not because you're paid isactually going up at the rate
that you think it is.
Yeah, it's just that you'repaid is becoming the primary and
(25:00):
last touch point totally for acustomer first and last touch
point Right.
In a way that it wasn't rightbefore.
Yeah, yep, exactly.
So again, take a step back andrealize, like we have
conversations with clients allthe time of like, hey, if my CPA
has gone up like things aren'tworking anymore, and it's like,
(25:23):
well, your CPA was never thatactually.
Speaker 2 (25:25):
Yeah, for sure, your true CPA.
Yeah, like your.
Speaker 1 (25:27):
CPA probably never was 35.
Like, and then we're pretty.
We try to be honest about it,yeah, but sometimes you don't
see certain variables, forexample, Sometimes you don't see
it for months.
Yeah, for example, we don'tknow, like you're organic, okay,
if you have really good organicpresence, like you're going to
have a really low CPA period,yeah, like you just will.
Until you reach a point.
(25:49):
Where your paid starts overyour paid is the one introducing
everyone to your brand.
Speaker 2 (25:55):
And then all of a sudden it looks like a box to 28
bucks.
It is way more than I thoughtit was, it's like yeah, guys,
that's just life.
Speaker 1 (26:01):
No, no, again, you can, you don't have to girl like
that.
Yep, so if you're just usingpaid as like this kind of
Balanced lever, yeah, on thescale of, hey, like we're just
using this to, yes, get newcustomers but, like, ultimately
operate at a total efficiencyrate of this, because this is
(26:23):
what we're comfortable with andthat's this conversation isn't
for you.
Yeah, that's fine, you can dothat.
Yeah, now your business willstruggle in the long run Totally
, but you can hum around and ifyou're super profitable and it
works, then just do what you'redoing.
Speaker 2 (26:38):
Yeah, yeah, for sure.
Speaker 1 (26:40):
Right, but this for for the brands that want to grow
and need to grow, then this isthe conversation that you have
to be having.
Speaker 2 (26:47):
Yeah, and you gotta be brave because it is.
It's scary just in a normalmonth, right, but we're in a
crazy time, right.
My other dates I was going tosay was you got, you got May,
march, of all about.
Like, if you can just zoom outof the situation you're in, you
will probably make way betterdecisions.
Speaker 1 (27:26):
But in COVID everyone shut ads off without thinking
for two seconds of oh, everyoneis sitting at home on social
media.
Speaker 2 (27:34):
Yeah, like this is the best time to actually run
ads Like ads are crushing.
Speaker 1 (27:41):
Yeah, why are we going to turn them off?
Like just because of the quote?
Uncertainty of buying behavior,buying behavior over time.
Well, it's like it is what itis until it isn't.
Speaker 2 (27:51):
What's what's number three, may 2021.
What happens May 2021?
What happens may?
Speaker 1 (27:56):
2021 remember may 2021 yep ios big ios update so
that's ios 14.5 with privacy.
Speaker 2 (28:02):
Yeah, and what does everybody do?
Because cpas automaticallyshoot up, right, yeah, well,
yeah, so ever you get anothergroup of people, so you people
lose.
In 2018, lots of people go outof business 2020, tons of people
go out of business 2020, tonsof people go out of business
right or their businesses havenever recovered since, yeah,
exactly 2021,.
another group of people Massive,massive.
Now, that one was kind of hardbecause that was also during the
(28:29):
time when tons of people hadturned off their.
That one was way sucky becausetons of people would turn off
their budgets for covid.
They all got their pos delayedand then they all came like
spring of 2021 and so they likehad all of this product that
they couldn't sell inventory.
You know, yeah, so that onehurt, and then we're now sitting
at I forget about the supplychain crunch there that's
(28:51):
finally recovered barely.
You know that one's.
That's a the supply chaincrunch there.
That's finally recovered barely.
You know that one's.
That's a tough supply chain'sdifferent right that one's, that
one's rough but now that's atype of black swan that is
really rough.
Yeah, yeah, but but now we'rein this other state of place,
state of mind right now, whereit's like recession.
You know, I was.
I wasn't around in our risk in,I mean, I wasn't possible
(29:11):
recession I wasn't a businessowning marketer in 2008, you
know, during that recession.
Speaker 1 (29:17):
Like the housing.
Well, that's a total financialcrisis.
Speaker 2 (29:20):
Yeah, like I don't.
I like my dad survived, luckily, you know, in his stable.
Speaker 1 (29:27):
So I don't really know much.
Speaker 2 (29:29):
I was on my.
I was on my morning missionduring the time so I didn't
really like much.
I was on my Mormon missionduring the time so I didn't
really like I was at the?
Speaker 1 (29:35):
U I don't even remember.
Yeah, I just I didn't like, Idon't remember it actually
happening.
Speaker 2 (29:39):
Yeah, I was so kind of like I'm sure my dad was
stressed, yeah, sheltered fromit, because of where I was gone.
Speaker 1 (29:42):
Luckily my dad didn't have most of us in the house at
that point.
Speaker 2 (29:56):
So that probably we're in this looming recession
and what's going to happen is alot of you guys are going to
pull back.
Spend now because things aren'tas efficient, but where you're
going to really feel it may notbe right now, but you're going
to feel it three to six monthsfrom now.
That's when you're going toreally get beat up.
Speaker 1 (30:10):
Yeah Right, and potentially won't ever be able
to recover, and so the pointeverything in life is a game of
momentum is what I've come towell, it's, and it's so
contagious too right, like ifyou're, if you have momentum and
you like you got to think realhard about killing your momentum
.
Yeah, like you better have areally good reason oh, a
(30:32):
thousand percent, bro, for forshutting down momentum.
Like a very like this is a redfire, red alarm, yeah, red alert
scenario that.
But this is again.
We're not saying it's easy tomake these decisions, like if it
was so easy, everyone wouldmake it.
But what we are saying is,oftentimes those decisions are
made because people are toofocused on an efficiency metric,
(30:56):
when that efficiency metric isnot, like Preston said, an
effectiveness metric.
Yeah, so take this with somesalt.
You know, like, depending, thisis contextual.
This might not apply to yourbusiness, sure, but even if this
situation does not apply toyour business, you should always
(31:19):
, in your business, come up withwhat are you balancing your roi
with?
yeah, yeah, what is the, or yourcpa, you know, because people
use roi or cpa, like if you havea lot of products and different
SKUs.
And then, like, rois, get mightwill be better.
Cpa isn't great, for, you know,if you have SKUs that are $10
(31:39):
and SKUs that are like a hundreddollars, that changes things
dramatically.
But but, um, yeah, overall,like, if you're marketing uh,
effectiveness, you to just takea step back and say, cool, this
is our ROI or our CPA orwhatever, um, that's great, but
what are we balancing that with?
(32:00):
Yeah, it's, it's got to havesome kind of profit.
That you're balancing it withRight, and like if this goes
down, it's okay.
If this is going up, right,right, it's not okay.
Speaker 2 (32:14):
If every like I mean if everything's just crashing,
if roi or roi decreases or cpashoots up, but profits go down
too immediately which willhappen if you are a I mean ridge
wallets is pretty open aboutthis right, like they're in this
category of first time customer.
Speaker 1 (32:31):
Like you don't have a big returning customer cohort
that's coming back, so like theycan't yeah, they still play
this game by the way, becausethey have, you know, they, just
they play the scale game well,yeah and now they're profitable
on first purchase.
Speaker 2 (32:46):
Well, and where ridge wallets wins, if I like, I mean
my guess they win in a lot in afew ways sure they win in.
But ridge wallets operates withone of our like favorite like.
This has been, like, I wouldsay, our mantra for the last
like six months.
We say it all the times likethe more you sell, the more you
sell, yeah, right.
And so ridge wallets has thisorganic untrackable I shouldn't
(33:08):
say it's totally untrackable,because you can do it through
post-purchase surveys where,like, their product is so unique
that when somebody sees it,it's a very like where did you
get that?
Or it's very much like, oh, youhave wallet issues.
You got to get a Ridge wallet.
It'll be the last wallet youever buy.
Yeah, best quality product inthe entire world.
(33:28):
And they last forever.
They do last forever, yeah, youknow.
Speaker 1 (33:33):
And so they win because, yes, they, they spend
millions you sold me on it, I'mgonna go get one I'm actually
surprised I haven't bought oneyet um I have only not bought
one yet, because the wallet Ihave has a sentiment.
You got a sentimental walletright yeah, like it has like an
your kids give you a wallet,yeah well, I don't know what you
(33:55):
do like.
Yeah, they burned in like astamp or something, a picture
and letter from my kids.
Speaker 2 (34:01):
Yeah, I don't know why I haven't.
Speaker 1 (34:04):
That's the only reason why I haven't but I'm
actually thinking of taking thatout like the little thing and
like putting it in my somewhereelse in my office, like almost
like a little picture thing.
Speaker 2 (34:15):
Yeah yeah, I did.
This is just a side note.
I actually have the hard, likethe the hardest.
Speaker 1 (34:21):
There's a couple products but I never take my mom
.
Speaker 2 (34:23):
I have a really hard time buying.
I don't know why my mind has areally hard time spending money
on something where I put mymoney I think every guy does and
I think bridge talks about ityeah, it's like it's such a mind
once you buy it, like you neverguys don't go buy wallets all
the time.
Speaker 1 (34:40):
It's like you buy a wallet and you just like my
wallet was given to me.
Yes, you know and that's how Ibelieve wallets should be like.
Speaker 2 (34:46):
I believe everyone should gift someone a wallet,
yeah, and not have to buy theirown.
Speaker 1 (34:50):
But but again, ridge is one of those companies where
they accept lower profits asthey scale, but they can't be
unprofitable on first purchase.
Yeah right, or else they'd losemy assumption yeah, and he's
come out and said that.
I think so I don't think that'syou.
So again, this might not applyexactly to you, but again like
(35:11):
they're not expecting to get thesame return on spend as they
were when they were a 10 million.
Speaker 2 (35:17):
Yeah, they're not expecting probably a four ROI.
Speaker 1 (35:20):
And I love how open he is about how hard it is to
get to where they are too.
It's not like oh, we justsimply spent more money and
everything worked, and it wasjust a rainbow road of lollipops
and gumballs all the way to ahundred million dollar company.
Right, just so easy.
Speaker 2 (35:36):
So so easy everyone yeah, we're kind of making it
sound like this is very simple,like in no ways.
In no ways is simple well, it'shard for.
Speaker 1 (35:44):
If here's the reason why it's hard, one fear oh yeah,
that's scary, like you go fromyou go from like thinking your
efficiencies mean something tooh, but I'm spending.
I'm now spending two, three,four times more than I thought I
(36:04):
was spending.
Yeah, so that's hard to getover.
Speaker 2 (36:06):
And I'm only making.
I'm only making 30% more, Xmore amount.
I'm doubling my spend, but I'monly making 25% more X more
amount and I'm only making 25%more or something, and that that
that mentally is, even thoughI'm still profitable, in fact
more profitable.
It's hard, that's like a wait.
Speaker 1 (36:21):
I remember when I had that first my like one of my
very first marketing lessonswhen I was you know we learned
this lesson together because inone of my first gigs, uh-huh
efficiencies were at whateverand they're like oh, let's just
spend more, double spend.
Yeah, and so we doubled,tripled spend and I'm like
Efficiencies stayed the same.
Speaker 2 (36:42):
Yeah, it's like nothing's happening, we weren't
making more revenue.
Speaker 1 (36:47):
There's no new there's no new customers, yeah.
Speaker 2 (36:52):
Yeah, it's, it's a.
It's interesting, right, you?
Speaker 1 (36:53):
you have this kind of thought where it's like and
like returners went up a little,but like not, it was like, okay
, everything's not workingbecause we're focusing on this
ROI in the in the platform in2018, so it's a little different
.
But yeah, because we were sofocused on roi instead of like
what actually moves newcustomers, then we learned that
(37:14):
lesson of like oh, like it, theonly thing that matters for us
in this type of funnel is newcustomers.
Right, because of the industrythat we were in.
Yeah, we learned that lessontogether and it was.
It was a good lesson to learnbecause very quickly, it was
like oh, nothing's happeningright, yeah.
Yeah, I stayed the same too.
(37:35):
It said everything was goinggreat, especially in platform.
Speaker 2 (37:38):
Yeah, I met.
It was like everything's thesame.
Speaker 1 (37:40):
It's like what.
Speaker 2 (37:42):
You made a hundred thousand dollar, you it would be
like you made 500 grand inShopify.
But then meta would be like youmade $500,000 in Shopify.
But then Meta would be like youmade $400,000 of that here.
Klaviyo would be like you made$300,000 of that here.
Speaker 1 (37:54):
So what does that add up?
Speaker 2 (37:55):
I made $500,000, not $700,000.
Who's lying?
Attribution's always beenbroken.
Speaker 1 (38:01):
Yes, it has, which is why, again, efficiency
Overinflated before 2021,underinflated post-2021.
Which is before 2021,underinflated yes, 2021 which is
again focused too much onefficiency.
At that point, totally.
If you're focused too much onefficiency and not on, like, the
actual effectiveness of yourmarketing I like it.
Speaker 2 (38:18):
There's efficiency versus effectiveness podcast
title yes, shout out to preston.
Thank you for thanks for givingus a today.
That was not supposed to be thetopic of conversation.
Speaker 1 (38:30):
Yeah, but we have been talking about this a lot
and I love that.
Like I just saw his LinkedIn,post and cool context to it.
Yeah, and I was like that'sjust, that's the best way to
probably phrase.
It is what he said.
Yeah, efficiency is not alwayseffectiveness.
And this guys, this this andeffectiveness depends on your
business goals.
Speaker 2 (38:51):
If you're a subscription business, by the
way, and you're listening tothis, like this is a fire
episode for you because, like,that's where you make all your
money is through thesubscriptions, Right.
And so like if, if there'sanybody who should be listening
to us right now, this works sogood, especially when you have
good returning customer cohorts.
Speaker 1 (39:12):
Yeah, I mean whether you can.
But before we wrap it up, I justwant to say like this is harder
than it seems, for threereasons, and I just want to like
lay this out there so everyoneknows, like, what the, what the
actual hurdles are to makingthis happen.
And when you want to scale andyou want to grow, yep, one fear
it's hard.
Yes to opex.
You're going to have to figureout something on opex, sure,
(39:34):
it's hard to find a way to lowermargins, to squeeze, you know
whatever.
Yep, okay.
And then three it's how do youimprove your customer retention
in the short and long term?
Yeah, and by customer retention.
There's a subcategory there ofshare of wallet.
Like, how do you actually getthem to spend more upfront and
(39:59):
quicker?
Yes, so you're not waiting forit in month two, three, four,
five, six, right, yeah, I likeit, like that's why it's hard.
Yeah, it's it Like that's whyit's hard.
Yeah, it's because not everyonelike a lot of some people can
operate just off of fixing thefear factor.
Yeah, they could.
Everything else could remainthe same, and if they just fixed
(40:19):
how scared they were about itand their mentality, they could
just probably rip for another 20, could, 20, 30 million come a
hundred million dollar company,you know it's scary because,
like what if something changedand we're spending so much money
?
Right, yeah, but a lot of people, especially if you're not in
subscription or if you don'thave a good returning model or
(40:40):
whatever.
You're going to reach thispoint of first-time
profitability where You're gonnahave to figure out some optics,
right.
Speaker 2 (40:49):
Yeah, for sure I like it.
I think we can end therepersonally sweet.
So thanks everybody.
Well, not the direction we weregoing, the least navidad next
week.
This is what, just to give youguys a little precursor as to
what is going to probably happennext time.
So one of the things that markand I are talking a lot about is
I get this all the time in mysocial content.
I do talk a ton about howimportant it is for brands to
(41:14):
supplement their ad buying reachwith organic reach and how most
brands suck at it, and that'sjust a fact.
There are very few brands whoare good at creating good
organic content.
And just look at the people youfollow.
You're not following any brandsfor the most part, but we are
compiling a list, but we arestarting to identify people who
are absolutely crushing it andwho are seeing results In very
(41:36):
strange and interesting ways, ohyeah yeah, we're going, every
you know.
Speaker 1 (41:41):
Like this isn't necessarily e-commerce.
Yeah, we're not just talkingabout like.
Speaker 2 (41:44):
I feel like brands were always oh, ryanair and
chipotle are so good at thiskind of stuff.
Like that's not what we'retalking about.
We're talking about brandsyou've probably never heard of
before, who are just crushing itbehind the scenes.
So we're gonna start bringingthem up, we're gonna show them
on the screen, we're gonna walkthrough why they're doing the
way they're what they're doing.
So, um, we'll have guests on aswell to give their take on it.
(42:05):
So, instead of kind of doinglike a normal guest, where it's
like, hey, how did you buildyour business?
And blah, blah, blah, likelet's have them rip through it
too.
So that's what's to come, muybueno, so all right everybody.
Thank you so much.
We'll see you guys next Tuesday.
Speaker 1 (42:20):
Vamos.
Speaker 2 (42:22):
Thank you so much for listening to the unstoppable
marketer podcast.
Listening to the unstoppablemarketer podcast.
Please go rate and subscribethe podcast, whether it's good
or bad.
We want to hear from youbecause we always want to make
this podcast better.
If you want to get in touchwith me or give me any direct
feedback, please go follow meand get in touch with me.
I am at the Trevor Crump onboth Instagram and TikTok.
(42:44):
Thank you, and we will see younext week.
if you can just zoom out of the situation you're in,
you will probably make waybetter decisions.
But in COVID everyone shut adsoff without thinking for two
seconds of oh, everyone issitting at home on social media.
Speaker 2 (00:12):
Yeah, like this is the best time to actually run
ads.
Speaker 1 (00:15):
Ads are crushing.
Why are we going to turn themoff, Like just because of the
quote?
Uncertainty of buying behavior,buying behavior over time.
Well, it's like it is what itis until it isn't.
Speaker 2 (00:26):
Yo, what's going on, everybody?
Welcome to the UnstoppableMarketer Podcast.
With me, as always, is MarkGoldhart.
What's up, Mark?
How are you, sir?
Good Goody, good Goody, goody,here we are, here we are Tuesday
afternoon.
I'm actually excited about whatwe're going to talk about today
(00:47):
, personally, so I'm excited forthe episode.
Yeah, yeah yeah, any news.
The Pope died, you see that.
Speaker 1 (01:00):
Yeah, the Pope died.
Watch out for whoever JD Vancevisits next.
Speaker 2 (01:07):
I watched a whole like I had no idea how they
select the next pope you did notknow I had no idea.
Speaker 1 (01:14):
Oh, it's pretty yeah, they all get locked in a big
giant chamber and it's likeassuming there's some toilets in
there, though black smoke.
Speaker 2 (01:22):
If it's, if they've come to this decision or no, if
they haven't.
If they haven't, white smokecomes out of the if there is
chimney, if there is yes I don'tknow.
Speaker 1 (01:32):
That's a good question I mean it's in a lot of
movies.
Producer asked if it was insherlock holmes, it's there.
There was a lot to it, it'smore than just the top cardinals
and I don't know how manycardinals yeah go in.
I think there's a hundred and Iactually think I do know the
number.
I think it's like 140 Cardinals.
Speaker 2 (01:52):
Well, that's news right there.
Speaker 1 (01:54):
I should look it up really quick.
Speaker 2 (01:56):
Also other news.
I saw Trump signed an executiveorder to this one's awesome.
Personally, as somebody who'shad kids before, there's nothing
worse than like getting thebill.
Speaker 1 (02:12):
Only 135 Cardinals.
You said 140?
.
Yeah, nice Are eligible to votein.
It's called the Conclave.
Speaker 2 (02:20):
Yeah.
Speaker 1 (02:22):
And crazy.
They released a trailer for amovie called, I think, the
conclave.
Speaker 2 (02:25):
Really no social.
No phones can be there.
No, nothing like they're.
Speaker 1 (02:30):
They're legitimately cut off yeah, like they are in
there debating and I don't knowhow long it lasts, like I wonder
, and to be fair, I'm notcatholic, so I don't know if
debating is the right word, butyet, yes, they have to come to a
consensus.
Deliberating deliberating,that's the word I'm looking for,
not debating so I think there'slike each, there's like a few
(02:51):
sects that like bring forth,like maybe like the person they
think.
Yeah, I'm sure it's not likeeveryone is like I'm the pope,
yeah, vote for me.
I wonder if it has to beanonymous.
I don't know.
I'd be really interested tofind out, though.
Yeah, I mean, that's a personwho I mean.
What is there?
Close to a billion Catholics?
(03:12):
I don't know how many Catholicsare there.
Speaker 2 (03:15):
I don't know that's a lot of people.
Speaker 1 (03:18):
It's an important world figure.
Speaker 2 (03:20):
Yeah, that's a very important world figure.
I'd probably say one of the,you know, at least one of the
most well-known world figures1.4 billion.
Catholic or not?
You know, everyone knows whothe Pope is, wow.
The other thing I was saying isTrump signed an order.
I heard where you know how yougo to the hospital.
You have a baby for exampleyeah.
(03:41):
And you have no idea what thebill is going to be.
Ugh, nor do have a baby, forexample.
Yeah, and you have no idea whatthe bill is going to be.
Oh, nor do you like when youget the bill, nor is it like
itemized as to what it is.
Speaker 1 (03:48):
It's just like you owe 12 grand, yeah, for having a
baby, you're like well, what'salso a joke about it is they
don't tell you what theinsurance like, because if you
pay in cash it's often cheaper,sure, but then it won't count
towards your deductible.
But for some reason, you haveinsurance like, sometimes, if
you do have a high deductible,it's more expensive than if you
paid for cash.
It's like a total mess and youdon't know why or what.
(04:11):
Like you said, it's very like.
The itemization is oftenstrange.
Yeah Well, trump signed anorder.
Doesn't make any sense To saylike before you leave.
Speaker 2 (04:18):
You have to know exactly what it is Like.
You have to know exactly whatit is Like they have to tell you
.
This is what it's going to be.
Speaker 1 (04:23):
Oh, so you don't have to wait for two months and it's
not an estimate Like this willbe between six and 10 grand.
Speaker 2 (04:28):
This is the bill.
You must know, and what it isand why, which I think is
actually really cool.
Speaker 1 (04:33):
I wonder what that does to price action for medical
care.
So Hopefully it simplifies ityeah.
It's a waste, maybe too Likecause I always feel like I
remember how much I paid for myfirst kid, because they, for you
know, maybe shame on me cause Ididn't go through all my
insurance documents, but wethought like the extended stay
(04:57):
was covered.
Uh but then it wasn't Ouch.
So we were there for two daysor three days, but each day is a
lot of money.
Speaker 2 (05:09):
I after the first kid our next two.
I was out of the hospital.
Speaker 1 (05:14):
Like as soon as possible, right.
Speaker 2 (05:16):
This.
People are going to get mad atme for this.
But like I over pushed, almostlike my wife, like let's just
get out, like I will take careof you at home, as long as
everything's fine.
Right, the birth went fine.
As long as it's like, just likea baby's fine Wife is fine, you
know, because it's just likethere was nothing more miserable
than sitting there and my wifeand I are not people to be
(05:36):
waited on, you know, so thatthat part of the hospital was
not beneficial for us.
Right To have that baby takenfrom us so that we can get some.
You know, it was more like mywife wanted the baby or I wanted
the baby, right?
So if I need to sleep, she hasthe baby if she needs sleep, you
(05:57):
know.
So we were like one day andjust like let's get out of here
as quickly as humanly possible.
Speaker 1 (05:59):
I don't, but I just hate hospitals.
So I do have to say it is notfun, no, but I think, look, we
had a good guy on our, we had agood guest a while back.
I want to read something thathe posted.
His name is Preston Rutherford,very prestigious name.
Speaker 2 (06:17):
Oh yeah, co-founder of Chubbies.
Co-founder of Chubbies the swimtrunks.
Speaker 1 (06:21):
That sold for, I believe, over $100 million right
yeah, I believe so, so youcould say maybe he knows
something about growingbusinesses, right?
Speaker 2 (06:32):
I would say yes okay so shout out, preston, you're
gonna paraphrase this right,because normally these things
are like yeah, I'm gonnaparaphrase it, but I'm.
Speaker 1 (06:42):
But I'm opening up the post because I do want to
credit him, because we've beentalking about something like
this a lot and it's somethingthat you should be talking about
, depending on the goals of acompany.
Speaker 2 (06:54):
We're wearing the same pants today, just a
different color Shout outStandard Issue.
Yeah, look at us.
Speaker 1 (07:01):
The Resort Collection Limited limited, limited run.
We didn't make these ever again.
Speaker 2 (07:03):
Look at us the resort collection Limited, limited,
limited run.
Speaker 1 (07:05):
They didn't make these ever again.
So look what Preston does onLinkedIn is he has these pretty
helpful conversations that youknow these.
What do you call it Likerole-playing conversations
between a CFO and a CMO?
Yeah, it's generally between aCFO and a CMO yeah, Sometimes
it's the CMO and the CEO.
Correct, yeah, between a cfo anda cmo.
Yeah, sometimes it's the cmoand the ceo, correct?
(07:27):
Yeah, and the what he, what hetalks about in the one that
resonated recently because we'vejust had this conversation a
few times yeah, is it'sbasically the cfo is saying hey,
our row as our roi ourefficiency metrics are down are
down or you know whatever, andthey're know he's getting after
the CMO.
and the CMO has to kind of gothrough this dialogue of saying,
(07:49):
well, yeah, but if all you'refocused on cause like efficiency
, the line that I grabbed fromit is efficiency is not always
effectiveness right For yourcompany, totally so.
If you're incentivizing yourmarketing team to go after
efficiency, they will, butthat's going to include a lot of
(08:12):
stuff that's not growing yourbusiness in the way that you
might want to be growing.
Speaker 2 (08:17):
Right.
Speaker 1 (08:17):
Some businesses don't want to grow like that, and
that's a totally differentconversation.
Right, like you have differentgoals for different kinds of
businesses, but efficiency isnot effectiveness.
Right, like you have differentgoals for different kinds of
businesses, but efficiency isnot effectiveness, right?
Right, it doesn't mean theydon't overlap.
And it doesn't mean you shouldlook at efficiency, depending on
what your business is and theshape of your business and the
unit economics and so on and soforth.
(08:39):
But the conversation basicallyis cool.
Well, if the goal is to growand the company wants to grow
from X to Y to Z, then we cannotbe focused on efficiency.
We have to be focused on growthand you know unit economics and
(09:01):
how you can actually.
You know economics of scale,unit economics and how you can
actually.
You know economics of scale,like how do we get to this place
together?
But we have to come up with anew unit, right, or kpi, of what
success is.
Sure that incorporates someefficiency into it, but if all
you care about is thisefficiency number that got you
to where you are now, it's notgoing to get you to where you
(09:22):
want to go.
Yeah, right.
So, like you have to readjustyour frame of thinking.
Yep, If you go from let's justmake up some arbitrary numbers,
right.
If you're a seven figure brandand now you're an eight figure
brand, right, hey, that's great.
Yeah, but if you want to be, ifyou want to go from 10 million
to 50 million, a cpa of 80dollars might not get you there
it's probably not going to getyou there and maybe it doubles,
(09:46):
or maybe it increases by 50percent or yeah.
So you got to think about itlike you're pushing up against
not only like more competition,but total obtainable markets.
Now, instead of having your uh,like, your penetration into a
market being like organic wordof mouth, possibly, or your
(10:07):
organic social, it's now goingto be more ads that are
introducing people to your brand.
Speaker 2 (10:11):
It's going to be at a higher scale at a higher scale
yeah, yeah, you still might havethe organic, so let me give you
a good example.
Speaker 1 (10:17):
So naturally, efficiency is just going to go
down.
It is what it is and, yeah, goahead.
Speaker 2 (10:21):
I'm going to give you numbers.
I'm going to make them lessexact and a little bit more
general, but this is a client ofours.
Nobody's going to know this, soI'm not giving out who it is
and what, but we have a client.
We use a metric called thereturn on contribution margin
dollar, which is essentially,for every $1 you spend, what is
(10:46):
your profitability, based off ofvariable costs?
So variable costs meaning likerevenue minus cost of goods sold
, minus shipping and and adspend Correct.
So not looking at like yourOPEX, right, we oftentimes will
look at this metric.
So when we first started withthem and we do like to include
OPEX.
(11:06):
Of course, yeah, OPEX is awesome.
Of course.
You know, obviously, Becauseyou got to know.
Hey, what do you need to makein order to stay in business?
Speaker 1 (11:12):
But OPEX tends to grow as you grow.
A little slower, sure A littleslower, sure Than the variables
do.
Speaker 2 (11:18):
Yes, absolutely.
Speaker 1 (11:19):
Well, yeah, generally it's a little more.
Speaker 2 (11:21):
It's like a little more constant, if it doesn't,
then you're probably not doingOpEx right, yeah?
So when we first started theyhad like a seven.
I mean it was awesome Like theywere crushing it, and it's
because they had their cost ofgoods sold.
Their margins are unreal, likeunreal margins.
Okay, they were like a six or aseven when we first started,
but they were making like$30,000 to $40,000 in overall
(11:46):
profitability, not revenue.
I'm talking at the end of theday.
After all's said and done,we're profiting $30,000 to
$40,000 a month.
Okay, rewind or fast forwardmaybe 12 to 18 months later.
Their return on contributionmargin dollar is like a 2.5 or
three.
Okay, so significantly less,which means that their CPA went
(12:08):
from like $30 to like 70 orsomething like that.
Okay, and I might be gettingthat off.
It doubles essentially Okay Inin most people's mind.
If we're looking at efficiency,that cfo is like whoa, bestie
media.
What are you doing?
Pump the brakes.
Speaker 1 (12:26):
You're nuts like our cpa, has gone from you are doing
it all wrong.
Speaker 2 (12:32):
10 to 70 or whatever, right, yeah but when you go and
look at what their overallprofitability is on the month,
they went from 30 40k to like200 300k yeah, they're profits,
profits.
Speaker 1 (12:48):
So yeah, they, they went from it's a forty thousand
dollars in profits to over twohundred thousand.
Speaker 2 (12:54):
What a massive mistake that would have been by
the cfo if they would have saidstop what you're doing right now
.
Speaker 1 (12:59):
Because efficiency looks bad.
Speaker 2 (13:01):
Because look how inefficient we are.
Yes, and that's what Preston'stalking about is efficiency
doesn't always mean it's themost effective thing to do for
the business, yes, or the mostprofitable thing to do for the
business.
Speaker 1 (13:13):
Now, by the way, we're not advocating.
Sometimes it is necessary,depending on what your product
and industry are, but for mostit's not necessary to lose money
on your first customer.
But what we are saying is,depending on your growth goals,
you need to consider not makingmoney.
Sure, so like, approximateprofit for your first customer,
(13:36):
you know might not be what youthink it should be.
Yeah, because you have to startlooking at things as hey, what
is?
I know there's a lot of hottakes out there, but you do.
You have to look at things aswhat's your LTV right?
What's your returning customer,and then you can create a game
plan off of that.
Speaker 2 (13:55):
Totally.
Speaker 1 (13:57):
And we're not saying that you have to look at a LTV
of 365 days out of each cohortand yeah, I mean you can
literally do it that simple.
It's like hey, here's my cohortanalysis.
What is my average return?
Yeah, over four months or threemonths, maybe it's 90 days,
maybe it's 180 days.
I don't know what your cashflow situation looks like.
So, depending on you, yourcompany, yeah, you'll, you can
(14:20):
adjust it and that's a reallygood thing.
Speaker 2 (14:22):
I'm glad you said that, because one thing because
you're gonna have some peoplewho are gonna be like well, my
cash flow.
Of course cash flow.
Sometimes you don't have theability to lose the way that you
could in the early stages, fromthe most effective way to
market, so that that is onething right.
There's a cash flow issue.
That can always happen, so weget that, but barring that,
(14:46):
efficiency is not alwayseffectiveness.
Speaker 1 (14:54):
It's one variable amongst many.
Speaker 2 (14:58):
The way you should look at efficiency, if I may, is
that should help you understandhow to better Tactical, how to
better optimize your tactics,not meeting like okay yeah yeah.
We put it on a bunch of new adcreative.
Was that?
(15:18):
Was that the ad creative thatmaybe did this?
Or is it just the sheer factthat we are getting to larger
numbers and so effectiveness isgoing to go down?
So I think you look atefficiency to help you with the
levers that you're pulling, butit doesn't necessarily mean that
you say let's, let's ask whatwe're doing, let's decrease
(15:42):
spend, let's drop it all downbecause, because it's- not
efficient, like the way it wasExactly.
Because I guess I mean we'veseen it enough with our clients.
Speaker 1 (15:50):
Because, again, the thing about the efficiency is
often what happens is you'll seethis, this scaling effect right
, like all of a sudden you startcapturing low-hanging fruit,
like you scale up, things looklike they're going really good,
but efficiency will start goingdown yeah and things are still
going good.
(16:10):
If you're looking at profits andif you're looking at certain
metrics, so it's just like, hey,what are you going to
prioritize?
Like, if you want to prioritize, you know a 30 cpa if that's
what you were getting, but nowit's going up, yeah, but if
you're getting the right kind ofnew customer into your mix,
where your profits are growing,yep, then you know it is what it
(16:34):
is.
Speaker 2 (16:34):
I'm going to make a but, if you don't want to scale
totally different conversation,I'm going to make a bold
statement Brands that that maketheir CPA their lead metric
always fail.
Oh yeah, over time, over time,always.
It's not only have we seen it,we've seen it with dozens of
businesses that we've workedwith.
(16:55):
This is actually the number onereason a client leaves us.
If I can get this transparent,this is actually the number one
reason a client leaves us.
If I can get this transparent,the number one reason a client
leaves us is because there'sthis disconnect and maybe
there's a shame on us for maybenot being able to educate and
articulate a little bit better,which I think we generally do
pretty good at, but it isoftentimes one of the number one
reasons is when that starts togo up.
(17:16):
Yet things are still going goodfrom a profitability
perspective.
There's this chokehold struggleto give that metric up or a
little bit more grace, and whathappens is oftentimes those
businesses will leave, will partways, and six months to 18
months later.
Speaker 1 (17:37):
They're always going down and they're going down fast
.
We use a tool called Particleand we can look it up months to
18 months later they're alwaysgoing down and they're going
down fast.
Speaker 2 (17:40):
We use it, we use a tool called particle and we can
look it up to see how people aredoing and it'll it'll show us
revenue, it'll show sales andand they're headed down.
You know, or we hear from theinside somebody saying, hey, we
wish we, we wish we would havedone xyz, it happens all the
time.
Speaker 1 (17:56):
Or sometimes they come back yes, and say hey, they
they prioritize efficiency asthe lead metric.
You just can't grow.
When you do that, you're notgoing to grow.
No, I mean, I think the hardtruth in marketing is the
company that wins is the companythat's willing to pay the most
for a new customer.
Speaker 2 (18:15):
And the company who has balls.
Speaker 1 (18:16):
And can pay the most.
So, they're like again's opexthings here, like we're not
saying run yourself into theground, just going getting a and
being done.
Five roi on a new customer butwe are saying that you got to
zoom out like what's your goalslong term, short term?
You know what is the priorityfor your company.
(18:38):
If it is profit, over timewe'll look at compounding
effects of of new customers onyour business.
Um, but yeah, if you're notwilling to like someone else is
yeah, period.
Like someone will try to paymore than you A thousand percent
and that company will win.
So you got to figure out how toa charge more.
(18:58):
Bundle right, get more out ofyour customer to justify certain
kinds of costs to acquire themYep or what Expand it Like.
What's the window that you'relooking at?
Is it month zero to month threein a cohort analysis?
Is it month zero to six?
Speaker 2 (19:14):
Or start doing things like if you can't increase AOV,
like you were talking about, orincrease conversion rates, then
you have to find a way toincrease your traffic outside of
just paid, which is oftentimesorganic right to make that
dollar go further.
So, rather than you having toreach 20 million people in a
month to generate x amount ofsales, yeah, um, paid, maybe you
(19:38):
can reach 15 million, and youknow paid and 5 million
organically, you know anythingto eat into that as well.
Speaker 1 (19:46):
Yes, which, again, like you should be doing all
those things, but like,ultimately, like you're not.
If you're trying to grow atcertain types of velocities,
like you're just, you just can't.
You cannot expect to have thesame CPA.
So if you're working with anagency or you have a media buyer
on your team, whoever you'reworking with, like I'll bet that
(20:09):
most people who listen to thisare guilty of prioritizing ROI
to the point where it iseffectively handicapping them
from growing their businessAgain, growing their business in
a profitable way.
A thousand percent said, ittakes guts because there is this
(20:29):
.
There is this point where everycompany gets where it's like
they see growth but it's like,oh, it's a little harder now.
It's like, yeah, guys, guesswhat?
Like if it was so easy to justspend more money and make more
money at the same efficiencyrates as you were when you were
(20:49):
a small business.
Everyone would do it, everyone.
Everyone would have a hundredmillion million brand right now.
Speaker 2 (20:54):
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Let me give you.
Let me give you four dates.
Speaker 1 (21:47):
Everyone would be Ridge wallets right, like
everyone would.
If it was that easy, then justspend money like cool.
But it's hard for two reasons.
A, yes, like you do have tofigure out what profitability
marks at what point in thecustomer purchase cycle or
journey work for you.
Uh, the other hard part is whatyou mentioned earlier is it's
(22:09):
scary, totally, and and mostpeople don't.
What we have seen is mostpeople don't fail because they
all of a sudden?
are so unprofitable that theycan't function Right.
We see most people fail becauseit's just so uncomfortable.
Speaker 2 (22:27):
They pull back and what ends up happening is their
profits start to become lowerthan their OPEX, then they have
to start firing, and then whathappens is they don't have the
manpower, pos and marketingdollars to then scale back up.
Yeah Right, so there, and andthis all hits even this hall
(22:49):
hits 10 times harder.
I actually don't even this isnot what we were actually going
to fully talk about today.
I actually don't even this isnot what we were actually going
to fully talk about today.
I actually don't even think wego into what we were going to
talk about today.
Let's save it for anotherepisode, because I think that,
like this is actually superimportant, and I can go on for
like 15 more minutes with this.
Speaker 1 (23:03):
Yeah, we can talk about it another day.
Speaker 2 (23:05):
So when times get harder, aka right now, I would
deem now as a hard time for tworeasons.
One, we've had economicuncertainty for the last three
years.
Well, for a while, yeah, right,yeah, now, even more so for the
last few months.
(23:25):
Okay, and then you add tariffsto that, which makes it even
harder for businesses.
So let me give you four datesthat have happened in the last
six years may 2018 what happenedin may 2018 was the pay-to-play
model that meta put out.
Speaker 1 (23:44):
that's when it, like, really kicked in meaning yeah,
when you say put out, it's justthat's when.
That's just like may 2018, whenthe algorithm was no longer
chronological, like you weren'tgetting shown to your followers
the same way we would postsomething and we would make yeah
, we would make 10 grand thatday from a post, not even ads
and then all of a sudden, andthen overnight in may.
Speaker 2 (24:06):
I can't remember the date in may, but I know may 28th
, may 2018, because I waslooking at analytics, google
analytics.
Okay, that was a time thatfreaked everybody out.
And what did a lot of brandsstart doing?
Pulled back, pulled back onspend because they were no
longer getting the efficiencyfrom the organic that they once
were.
So, and what happened is, yousee, a lot of people who went
(24:27):
under between 2018 and 2019 yes,okay, well, and, and that was
the so.
Speaker 1 (24:36):
So what I want to emphasize here is what happens
when your cpas go up as youscale.
A big part of that oftentimesnot every time, but oftentimes
depending on how how good yourorganic was before but but it's
not because you're paid isactually going up at the rate
that you think it is.
Yeah, it's just that you'repaid is becoming the primary and
(25:00):
last touch point totally for acustomer first and last touch
point Right.
In a way that it wasn't rightbefore.
Yeah, yep, exactly.
So again, take a step back andrealize, like we have
conversations with clients allthe time of like, hey, if my CPA
has gone up like things aren'tworking anymore, and it's like,
(25:23):
well, your CPA was never thatactually.
Speaker 2 (25:25):
Yeah, for sure, your true CPA.
Yeah, like your.
Speaker 1 (25:27):
CPA probably never was 35.
Like, and then we're pretty.
We try to be honest about it,yeah, but sometimes you don't
see certain variables, forexample, Sometimes you don't see
it for months.
Yeah, for example, we don'tknow, like you're organic, okay,
if you have really good organicpresence, like you're going to
have a really low CPA period,yeah, like you just will.
Until you reach a point.
(25:49):
Where your paid starts overyour paid is the one introducing
everyone to your brand.
Speaker 2 (25:55):
And then all of a sudden it looks like a box to 28
bucks.
It is way more than I thoughtit was, it's like yeah, guys,
that's just life.
Speaker 1 (26:01):
No, no, again, you can, you don't have to girl like
that.
Yep, so if you're just usingpaid as like this kind of
Balanced lever, yeah, on thescale of, hey, like we're just
using this to, yes, get newcustomers but, like, ultimately
operate at a total efficiencyrate of this, because this is
(26:23):
what we're comfortable with andthat's this conversation isn't
for you.
Yeah, that's fine, you can dothat.
Yeah, now your business willstruggle in the long run Totally
, but you can hum around and ifyou're super profitable and it
works, then just do what you'redoing.
Speaker 2 (26:38):
Yeah, yeah, for sure.
Speaker 1 (26:40):
Right, but this for for the brands that want to grow
and need to grow, then this isthe conversation that you have
to be having.
Speaker 2 (26:47):
Yeah, and you gotta be brave because it is.
It's scary just in a normalmonth, right, but we're in a
crazy time, right.
My other dates I was going tosay was you got, you got May,
march, of all about.
Like, if you can just zoom outof the situation you're in, you
will probably make way betterdecisions.
Speaker 1 (27:26):
But in COVID everyone shut ads off without thinking
for two seconds of oh, everyoneis sitting at home on social
media.
Speaker 2 (27:34):
Yeah, like this is the best time to actually run
ads Like ads are crushing.
Speaker 1 (27:41):
Yeah, why are we going to turn them off?
Like just because of the quote?
Uncertainty of buying behavior,buying behavior over time.
Well, it's like it is what itis until it isn't.
Speaker 2 (27:51):
What's what's number three, may 2021.
What happens May 2021?
What happens may?
Speaker 1 (27:56):
2021 remember may 2021 yep ios big ios update so
that's ios 14.5 with privacy.
Speaker 2 (28:02):
Yeah, and what does everybody do?
Because cpas automaticallyshoot up, right, yeah, well,
yeah, so ever you get anothergroup of people, so you people
lose.
In 2018, lots of people go outof business 2020, tons of people
go out of business 2020, tonsof people go out of business
right or their businesses havenever recovered since, yeah,
exactly 2021,.
another group of people Massive,massive.
Now, that one was kind of hardbecause that was also during the
(28:29):
time when tons of people hadturned off their.
That one was way sucky becausetons of people would turn off
their budgets for covid.
They all got their pos delayedand then they all came like
spring of 2021 and so they likehad all of this product that
they couldn't sell inventory.
You know, yeah, so that onehurt, and then we're now sitting
at I forget about the supplychain crunch there that's
(28:51):
finally recovered barely.
You know that one's.
That's a the supply chaincrunch there.
That's finally recovered barely.
You know that one's.
That's a tough supply chain'sdifferent right that one's, that
one's rough but now that's atype of black swan that is
really rough.
Yeah, yeah, but but now we'rein this other state of place,
state of mind right now, whereit's like recession.
You know, I was.
I wasn't around in our risk in,I mean, I wasn't possible
(29:11):
recession I wasn't a businessowning marketer in 2008, you
know, during that recession.
Speaker 1 (29:17):
Like the housing.
Well, that's a total financialcrisis.
Speaker 2 (29:20):
Yeah, like I don't.
I like my dad survived, luckily, you know, in his stable.
Speaker 1 (29:27):
So I don't really know much.
Speaker 2 (29:29):
I was on my.
I was on my morning missionduring the time so I didn't
really like much.
I was on my Mormon missionduring the time so I didn't
really like I was at the?
Speaker 1 (29:35):
U I don't even remember.
Yeah, I just I didn't like, Idon't remember it actually
happening.
Speaker 2 (29:39):
Yeah, I was so kind of like I'm sure my dad was
stressed, yeah, sheltered fromit, because of where I was gone.
Speaker 1 (29:42):
Luckily my dad didn't have most of us in the house at
that point.
Speaker 2 (29:56):
So that probably we're in this looming recession
and what's going to happen is alot of you guys are going to
pull back.
Spend now because things aren'tas efficient, but where you're
going to really feel it may notbe right now, but you're going
to feel it three to six monthsfrom now.
That's when you're going toreally get beat up.
Speaker 1 (30:10):
Yeah Right, and potentially won't ever be able
to recover, and so the pointeverything in life is a game of
momentum is what I've come towell, it's, and it's so
contagious too right, like ifyou're, if you have momentum and
you like you got to think realhard about killing your momentum
.
Yeah, like you better have areally good reason oh, a
(30:32):
thousand percent, bro, for forshutting down momentum.
Like a very like this is a redfire, red alarm, yeah, red alert
scenario that.
But this is again.
We're not saying it's easy tomake these decisions, like if it
was so easy, everyone wouldmake it.
But what we are saying is,oftentimes those decisions are
made because people are toofocused on an efficiency metric,
(30:56):
when that efficiency metric isnot, like Preston said, an
effectiveness metric.
Yeah, so take this with somesalt.
You know, like, depending, thisis contextual.
This might not apply to yourbusiness, sure, but even if this
situation does not apply toyour business, you should always
(31:19):
, in your business, come up withwhat are you balancing your roi
with?
yeah, yeah, what is the, or yourcpa, you know, because people
use roi or cpa, like if you havea lot of products and different
SKUs.
And then, like, rois, get mightwill be better.
Cpa isn't great, for, you know,if you have SKUs that are $10
(31:39):
and SKUs that are like a hundreddollars, that changes things
dramatically.
But but, um, yeah, overall,like, if you're marketing uh,
effectiveness, you to just takea step back and say, cool, this
is our ROI or our CPA orwhatever, um, that's great, but
what are we balancing that with?
(32:00):
Yeah, it's, it's got to havesome kind of profit.
That you're balancing it withRight, and like if this goes
down, it's okay.
If this is going up, right,right, it's not okay.
Speaker 2 (32:14):
If every like I mean if everything's just crashing,
if roi or roi decreases or cpashoots up, but profits go down
too immediately which willhappen if you are a I mean ridge
wallets is pretty open aboutthis right, like they're in this
category of first time customer.
Speaker 1 (32:31):
Like you don't have a big returning customer cohort
that's coming back, so like theycan't yeah, they still play
this game by the way, becausethey have, you know, they, just
they play the scale game well,yeah and now they're profitable
on first purchase.
Speaker 2 (32:46):
Well, and where ridge wallets wins, if I like, I mean
my guess they win in a lot in afew ways sure they win in.
But ridge wallets operates withone of our like favorite like.
This has been, like, I wouldsay, our mantra for the last
like six months.
We say it all the times likethe more you sell, the more you
sell, yeah, right.
And so ridge wallets has thisorganic untrackable I shouldn't
(33:08):
say it's totally untrackable,because you can do it through
post-purchase surveys where,like, their product is so unique
that when somebody sees it,it's a very like where did you
get that?
Or it's very much like, oh, youhave wallet issues.
You got to get a Ridge wallet.
It'll be the last wallet youever buy.
Yeah, best quality product inthe entire world.
(33:28):
And they last forever.
They do last forever, yeah, youknow.
Speaker 1 (33:33):
And so they win because, yes, they, they spend
millions you sold me on it, I'mgonna go get one I'm actually
surprised I haven't bought oneyet um I have only not bought
one yet, because the wallet Ihave has a sentiment.
You got a sentimental walletright yeah, like it has like an
your kids give you a wallet,yeah well, I don't know what you
(33:55):
do like.
Yeah, they burned in like astamp or something, a picture
and letter from my kids.
Speaker 2 (34:01):
Yeah, I don't know why I haven't.
Speaker 1 (34:04):
That's the only reason why I haven't but I'm
actually thinking of taking thatout like the little thing and
like putting it in my somewhereelse in my office, like almost
like a little picture thing.
Speaker 2 (34:15):
Yeah yeah, I did.
This is just a side note.
I actually have the hard, likethe the hardest.
Speaker 1 (34:21):
There's a couple products but I never take my mom
.
Speaker 2 (34:23):
I have a really hard time buying.
I don't know why my mind has areally hard time spending money
on something where I put mymoney I think every guy does and
I think bridge talks about ityeah, it's like it's such a mind
once you buy it, like you neverguys don't go buy wallets all
the time.
Speaker 1 (34:40):
It's like you buy a wallet and you just like my
wallet was given to me.
Yes, you know and that's how Ibelieve wallets should be like.
Speaker 2 (34:46):
I believe everyone should gift someone a wallet,
yeah, and not have to buy theirown.
Speaker 1 (34:50):
But but again, ridge is one of those companies where
they accept lower profits asthey scale, but they can't be
unprofitable on first purchase.
Yeah right, or else they'd losemy assumption yeah, and he's
come out and said that.
I think so I don't think that'syou.
So again, this might not applyexactly to you, but again like
(35:11):
they're not expecting to get thesame return on spend as they
were when they were a 10 million.
Speaker 2 (35:17):
Yeah, they're not expecting probably a four ROI.
Speaker 1 (35:20):
And I love how open he is about how hard it is to
get to where they are too.
It's not like oh, we justsimply spent more money and
everything worked, and it wasjust a rainbow road of lollipops
and gumballs all the way to ahundred million dollar company.
Right, just so easy.
Speaker 2 (35:36):
So so easy everyone yeah, we're kind of making it
sound like this is very simple,like in no ways.
In no ways is simple well, it'shard for.
Speaker 1 (35:44):
If here's the reason why it's hard, one fear oh yeah,
that's scary, like you go fromyou go from like thinking your
efficiencies mean something tooh, but I'm spending.
I'm now spending two, three,four times more than I thought I
(36:04):
was spending.
Yeah, so that's hard to getover.
Speaker 2 (36:06):
And I'm only making.
I'm only making 30% more, Xmore amount.
I'm doubling my spend, but I'monly making 25% more X more
amount and I'm only making 25%more or something, and that that
that mentally is, even thoughI'm still profitable, in fact
more profitable.
It's hard, that's like a wait.
Speaker 1 (36:21):
I remember when I had that first my like one of my
very first marketing lessonswhen I was you know we learned
this lesson together because inone of my first gigs, uh-huh
efficiencies were at whateverand they're like oh, let's just
spend more, double spend.
Yeah, and so we doubled,tripled spend and I'm like
Efficiencies stayed the same.
Speaker 2 (36:42):
Yeah, it's like nothing's happening, we weren't
making more revenue.
Speaker 1 (36:47):
There's no new there's no new customers, yeah.
Speaker 2 (36:52):
Yeah, it's, it's a.
It's interesting, right, you?
Speaker 1 (36:53):
you have this kind of thought where it's like and
like returners went up a little,but like not, it was like, okay
, everything's not workingbecause we're focusing on this
ROI in the in the platform in2018, so it's a little different
.
But yeah, because we were sofocused on roi instead of like
what actually moves newcustomers, then we learned that
(37:14):
lesson of like oh, like it, theonly thing that matters for us
in this type of funnel is newcustomers.
Right, because of the industrythat we were in.
Yeah, we learned that lessontogether and it was.
It was a good lesson to learnbecause very quickly, it was
like oh, nothing's happeningright, yeah.
Yeah, I stayed the same too.
(37:35):
It said everything was goinggreat, especially in platform.
Speaker 2 (37:38):
Yeah, I met.
It was like everything's thesame.
Speaker 1 (37:40):
It's like what.
Speaker 2 (37:42):
You made a hundred thousand dollar, you it would be
like you made 500 grand inShopify.
But then meta would be like youmade $500,000 in Shopify.
But then Meta would be like youmade $400,000 of that here.
Klaviyo would be like you made$300,000 of that here.
Speaker 1 (37:54):
So what does that add up?
Speaker 2 (37:55):
I made $500,000, not $700,000.
Who's lying?
Attribution's always beenbroken.
Speaker 1 (38:01):
Yes, it has, which is why, again, efficiency
Overinflated before 2021,underinflated post-2021.
Which is before 2021,underinflated yes, 2021 which is
again focused too much onefficiency.
At that point, totally.
If you're focused too much onefficiency and not on, like, the
actual effectiveness of yourmarketing I like it.
Speaker 2 (38:18):
There's efficiency versus effectiveness podcast
title yes, shout out to preston.
Thank you for thanks for givingus a today.
That was not supposed to be thetopic of conversation.
Speaker 1 (38:30):
Yeah, but we have been talking about this a lot
and I love that.
Like I just saw his LinkedIn,post and cool context to it.
Yeah, and I was like that'sjust, that's the best way to
probably phrase.
It is what he said.
Yeah, efficiency is not alwayseffectiveness.
And this guys, this this andeffectiveness depends on your
business goals.
Speaker 2 (38:51):
If you're a subscription business, by the
way, and you're listening tothis, like this is a fire
episode for you because, like,that's where you make all your
money is through thesubscriptions, Right.
And so like if, if there'sanybody who should be listening
to us right now, this works sogood, especially when you have
good returning customer cohorts.
Speaker 1 (39:12):
Yeah, I mean whether you can.
But before we wrap it up, I justwant to say like this is harder
than it seems, for threereasons, and I just want to like
lay this out there so everyoneknows, like, what the, what the
actual hurdles are to makingthis happen.
And when you want to scale andyou want to grow, yep, one fear
it's hard.
Yes to opex.
You're going to have to figureout something on opex, sure,
(39:34):
it's hard to find a way to lowermargins, to squeeze, you know
whatever.
Yep, okay.
And then three it's how do youimprove your customer retention
in the short and long term?
Yeah, and by customer retention.
There's a subcategory there ofshare of wallet.
Like, how do you actually getthem to spend more upfront and
(39:59):
quicker?
Yes, so you're not waiting forit in month two, three, four,
five, six, right, yeah, I likeit, like that's why it's hard.
Yeah, it's it Like that's whyit's hard.
Yeah, it's because not everyonelike a lot of some people can
operate just off of fixing thefear factor.
Yeah, they could.
Everything else could remainthe same, and if they just fixed
(40:19):
how scared they were about itand their mentality, they could
just probably rip for another 20, could, 20, 30 million come a
hundred million dollar company,you know it's scary because,
like what if something changedand we're spending so much money
?
Right, yeah, but a lot of people, especially if you're not in
subscription or if you don'thave a good returning model or
(40:40):
whatever.
You're going to reach thispoint of first-time
profitability where You're gonnahave to figure out some optics,
right.
Speaker 2 (40:49):
Yeah, for sure I like it.
I think we can end therepersonally sweet.
So thanks everybody.
Well, not the direction we weregoing, the least navidad next
week.
This is what, just to give youguys a little precursor as to
what is going to probably happennext time.
So one of the things that markand I are talking a lot about is
I get this all the time in mysocial content.
I do talk a ton about howimportant it is for brands to
(41:14):
supplement their ad buying reachwith organic reach and how most
brands suck at it, and that'sjust a fact.
There are very few brands whoare good at creating good
organic content.
And just look at the people youfollow.
You're not following any brandsfor the most part, but we are
compiling a list, but we arestarting to identify people who
are absolutely crushing it andwho are seeing results In very
(41:36):
strange and interesting ways, ohyeah yeah, we're going, every
you know.
Speaker 1 (41:41):
Like this isn't necessarily e-commerce.
Yeah, we're not just talkingabout like.
Speaker 2 (41:44):
I feel like brands were always oh, ryanair and
chipotle are so good at thiskind of stuff.
Like that's not what we'retalking about.
We're talking about brandsyou've probably never heard of
before, who are just crushing itbehind the scenes.
So we're gonna start bringingthem up, we're gonna show them
on the screen, we're gonna walkthrough why they're doing the
way they're what they're doing.
So, um, we'll have guests on aswell to give their take on it.
(42:05):
So, instead of kind of doinglike a normal guest, where it's
like, hey, how did you buildyour business?
And blah, blah, blah, likelet's have them rip through it
too.
So that's what's to come, muybueno, so all right everybody.
Thank you so much.
We'll see you guys next Tuesday.
Speaker 1 (42:20):
Vamos.
Speaker 2 (42:22):
Thank you so much for listening to the unstoppable
marketer podcast.
Listening to the unstoppablemarketer podcast.
Please go rate and subscribethe podcast, whether it's good
or bad.
We want to hear from youbecause we always want to make
this podcast better.
If you want to get in touchwith me or give me any direct
feedback, please go follow meand get in touch with me.
I am at the Trevor Crump onboth Instagram and TikTok.
(42:44):
Thank you, and we will see younext week.
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