Rethinking Acquisitions with Adrianne Verheyen and Grant Zanini from ADMission

Kristen:

Grant and Adrian, welcome to the show. Let's start off by having each of you introduce yourself and explain a little bit about what you do at Admission.

Grant:

Awesome. Thank you Kris and for having us. First off, my name is Grant Zanini and I am the co-founder at ADmission, which allows me the opportunity to work closely with the community but also work closely with the team here. As we continue to build what we believe is an incredible resource for our members.

Adrianne:

Yes. And I'm Adrianne, Kristen thanks so much for having us. Again, we're excited to be here. I run a growth community here at ADmission, which is part of Common Thread Collective e-commerce growth agency. I've been here at Agency Side for almost three years now and was so lucky to join Grant on a mission about a year ago and really start building this community of entrepreneurs. And we'll tell you guys more about that later but yes, that's what I do.

Kristen:

Well, it's so great to have you both on the show. I think this is the first and maybe only episode of season two, where we have two guests and these are some of my favorite interviews. Because we get these multiple views on the topic. And so I'm really excited about it. Also, thank you for addressing the Common Thread Collective ADmission thing because listeners, you're going to start noticing there's a lot of Common Thread people on the podcast this season and there's a reason. It's because Common Thread and ADmission and 4x400, they are all building just such an amazing community in such amazing ways to approach e-commerce that really connect with the mission here at Playing For Keeps. So I've brought the whole team on, I think, I think I'm like an adopted kid now.

Adrianne:

Oh, yes. Absolutely.

Grant:

You definitely are. It's a partnership at this point.

Kristen:

Yes. I love it. Well, let's just jump right into it today. This is something that if you're in DTC, you know this is happening, primary drivers of business like Facebook and Google have become much more competitive. Much, much, much more expensive and obviously much more crowded. And as a result of that, a lot of us are really experiencing a reduced return on Ad Spend, ROAS. I don't know why I had to say that all out. It was a mouthful. Compared to really "the golden age of DTC." So what you guys are seeing, you're working with entrepreneurs all the time, are you seeing that this is actually taking more than just a business toll on people? Is this starting to really take an emotional toll on e-commerce entrepreneurs?

Adrianne:

Yes, so I would actually argue that we are in the golden age of DTC, but what it felt like five years ago or three years ago when customer acquisition on Facebook was so much easier and cheaper seemed to be the golden age because of how easy and cheap it was. But now we're in this, obviously like you mentioned, stage where it's more expensive to acquire customers on paid channels like Facebook and Google. In fact, like the question that I get almost weekly from people that are potential members of ADmission is, "Isn't Facebook dead though. Why do I need to learn how to do this? Shouldn't I be moving towards X, Y, or Z?" And my answer is always, "Absolutely not. Facebook is still the number one channel to be acquiring customers on." We obviously serve all of our clients in hot space on Facebook and Google strictly.

Adrianne:

But what has changed is the level and the quality of creative and strategy that has to go into the things that you're doing on these paid channels. And so that's really where ADmission comes in, is helping e-commerce entrepreneurs in that early stage of growth acquire customers that are going to be lifelong loyalists to their brand, and also putting themselves out there in a way that builds a brand that isn't just chasing after top line revenue or for one-time customers. Yes, it has taken an emotional toll and we really built ADmission to be able to create a community where those entrepreneurs that are doing it, especially in the early stage of their business, don't have to do it in a way that's frustrating or sort of in this silo.

Kristen:

Yes. You said something that I absolutely love that you said it. I believe that I have tweeted this at least three times and it was in I think maybe my very first retention bite that I ever put out. I said, "the golden era of DTC is over." You said, "I actually think we are in the golden era of DTC." This is something that I really, really strongly agree with. And it's because for a business maybe five, six years ago, it was a golden age of just really quick cheap acquisitions, but for consumers that wasn't a golden age at all, that was a pretty crappy time to be a consumer. And now the consumers are demanding a lot more. And so I am excited about it. I think it's a really great shift.

Kristen:

I think it's getting business back to what it really should be about. And also for listeners, I want to notice something else that Adrianne said in that, we've had a couple of interviews here about acquisition and ads. Obviously this is a retention podcast, but what she said that's so very important is that everything is elevating the strategy. The quality of the ads is elevating into this thing where now you have to advertise to find customers that are going to actually stay with you for a long time. So as you're listening and you're hearing we're talking about ads, it's this idea of almost retention based acquisition and acquiring in a way that's actually really smart for your bottom line and really smart for your business and also really beneficial for your customers as well. Just wanted to pull it out for the listeners because Adrianne, you said so many amazing things. So now we just got to go straight for it. What really is ADmission at the end of the day?

Grant:

Yes. ADmission is a monthly membership community that provides dedicated training and support to help e-commerce businesses grow profitably with paid advertising. So I think to further explain that, what that actually means, Kristen, I think it's probably worth breaking down how we got here. Like many entrepreneurial journeys ADmission was birthed out of our own need for something that we found ourselves and others struggling with. And for listeners hearing that they're probably like, "No way." So many people forcing how they're going to 10X my business with Facebook ads and my response to that is that you're absolutely right. We saw and still see this widening gap in the market. Every single day between what we call agency fees and guru guarantees. What I mean by that is if you're responsible for growing an e-commerce business that is doing somewhere between zero and two million in annual revenue your options are actually very limited, right?

Grant:

You're at a place where you can't afford a digital agency yet, or economically it doesn't really make sense because you're not going to be spending enough to cover the costs for paying for a high expensive agency retainer fees. So the alternatives in that situation, if you're between zero and two million, is that you can go buy courses out there, which is a very transactional thing. You're spending off to plans anywhere between $500 to $2,000 to take on a course, which your taking requires more of your time and you don't know how relevant or outdated those tactics are. And [inaudible] when you're left alone, what happens when you get stuck or you don't know what to do next? It's a costly and really a time thing. You don't have a lot of time running a business or growing a business of that size to spend with potentially outdated material.

Grant:

Your second option then would be to hire a consultant, which is even more expensive. Call it three to five grand a month to hand it over to someone to do it for you, right? And you obviously lose learnings and a lot of potential understanding of what's working and what's not. And you're trusting someone else who's doing this for 10 or 15 other people to do it for you. We're seeing this happening. And we at Common Thread Collective, we're sitting in a really unique place because one, we are an agency and we are speaking to a lot of people who didn't make sense to come into the agency yet. We had to solve for this. We said, "How do we flip this model on its head to actually be able to provide for people in that area as they're at the most needs to grow their business, oftentimes, and have the least amount of resources to do so."

Grant:

We're in interesting places with infrastructure, right? We have 50+ staff here that are in this every single day for our own brands that we own and operate and for our agency clients. So we have a ton of data. We have a ton of expertise and support, so that would allow us to be able to provide a program that actually gave the support that people would need and the ongoing teachings and trainings and expertise that we're seeing every single day across a large sample set of call it 100 million+ on spend just in Facebook alone.

Kristen:

Yes.

Grant:

So that really is what stemmed from it. And that is a long winded way of me painting the picture of why we set out to change the way the game was being played and in the form of ongoing trainings with support to help e-commerce businesses grow profitably using paid advertising.

Kristen:

Yes. And I love that. And I love the story behind it too, because I think it actually plays in a very similar note to a lot of DTC brands growing is a lot of founders in the DTC space they're going about their life, they find this whole of something that they need, and they feel like they are uniquely able to approach it and succeed with it. And that's why I've seen a lot of different programs for acquisition. I've had a lot of people try to come on this podcast and there is a reason you guys are the only real course-like training material that we have on the podcast this season. And it's because you guys built it from this internal need and you saw this is something that people actually need. And we are uniquely positioned to provide something deeper and better and stronger than anything else out there.

Kristen:

And then on top of that, the like ongoing training that goes with ADmission, I think is something that's really powerful and like you said, not a lot of courses have that. A lot of it's you sign up for it, you go through it and hopefully you can implement it in a way that works for your business. You guys took it a step further and basically said, "We're going to give you the tools, but then we're also going to help to make sure that you are succeeding with the resources that we've given you." And I think that's really, really powerful. You gave us a background on who it's built for really in terms of where you are with your business and growth but Adrianne, can you speak to this a little, more who is the best entrepreneur who is listening to this podcast and trying to decide, is this something that's, of course, it's actually built for me and something that I would need. And piggybacking on Grant, why do you see it's really the best choice?

Kristen:

I obviously just gave my pitch as to why I think it's the best choice, but curious why you think, for that specific entrepreneur, why is this the best choice for them?

Adrianne:

Yes. So I'll start with who it's built for. And it's really broken down into three categories like who our core customers are. And so our entire community is either built of really the solopreneur founder type person who might be literally the only person on their team. So they're wearing every single hat. Maybe they have a co-founder. Maybe they have a team of three, like small team, right? But they're the ones doing everything. From acquisition to manufacturing tools, logistics, to building their website, like they're doing everything-

Kristen:

Yes.

Adrianne:

... in charge of their entrepreneurial journey. And they have found themselves in a place where they have to teach themselves how to run paid ads profitably for their business. And so they're the ones going through ADmission and participating in the community and receiving that ongoing support.

Adrianne:

The second group is really marketers at brands. And so we've seen a lot of people join who really pitched their boss or the founder of the company that they work for that ADmission is going to help them improve, really increase their slope as a marketer and also provide sort of a team that they wouldn't otherwise have at the brand that they work for. So whether they're the marketing coordinator or head of growth or whatever their title is that second group of who ADmission is built for.

Adrianne:

And then the third are the freelance marketers who are managing maybe a handful of smaller clients. Maybe they have a small agency, but they're looking to really increase their own slope when it comes to understanding strategies that larger agencies and larger brands are using. And so they see ADmission as a resource to help them grow there as a freelance marketer.

Kristen:

Yes. I love that. And I love how you broke it down into the three different types of people. And it's this idea that paid advertising is a really difficult skill to get down, and the people who are experts have been doing it for years and years on end and can sit all day and think about it. And I'm a marketer and even that's not something that's really in my curve of experience. Being able to provide a resource to someone that you get to learn how to do this yourself, but also in a way that's really safe because we're here to help you move through it, is very exciting to me and why I'm so excited to have you guys on here.

Kristen:

Now Grant back over to you. You guys have a pretty amazing formula. That's central to the curriculum at ADmission. We've heard from Taylor Holiday earlier this season, so you're going to hear a lot of I think, similarities here. From what I've seen though, the way you guys approach it really simplifies this whole crazy idea of how do I grow a business in 2020? So could you dig into that formula and explain a little bit of the why behind it and what it really means?

Grant: 

Absolutely. Let me give a little more context to this one as well. This formula, which I'll give you guys in a minute, is actually, I'd say, so deeply rooted into everything we do here at ADmission and through CTC is that, it's the formula is simple. First of all it's plastered on our wall so you'll see it as soon as you come in, but we use this formula as a method for teaching our people how to problem solve for clients revenue growth, right? So historically, this formula... If you're driving try to follow along with me V for visitors x CR (conversion rate) x AOV (average order value) = revenue, right? How you would think about this is really simply you can increase revenue by getting more people to your website, right? Increasing the V, the visitors, or you can increase revenue by getting more of them who are at your website to convert when they're there, that's conversion rate, or you can increase your revenue by getting them to spend more money, your AOV there.

Grant:

That's where it initially started. And that to us has been central to everything in the way that we teach. But it also like everything, platforms whether it's Shopify or Facebook, they evolve, right? We've seen this in our own businesses, as well as our client's businesses that is more about bottom line revenue profit than it is top line revenue, right? How we've adjusted this formula and anyone who comes through ADmission learns and breathes this as well as the employees here as they are teaching. The formula now is visitors x conversion rate x, we've replaced AOV with a term we call cash multiplier. So I'm sure Taylor talked about this if you've listened to his episode, if not go back. But cash multiplier is an internal coined term that is essentially a 60 day LTV.

Grant:

So looking at a lifetime value of your customer in a 60 day window, which is really critical because depending on if you've been in business two months or four years, your lifetime value is different, but what's also even, I think more critical for our clients or anyone who is in this space is cash-flow, right? So looking at a 60 day window is much more realistic and reasonable for your business. Again, the formula is now adapted to be focused on profitability versus top line revenue. It's just where the need is going with raising CPMs in the market and as far as being competitive in the space, it is essential that we are doing that for our clients that are helping people understand how to do that for their own businesses. V for visitors, still the biggest driver there for us is Facebook across the board, right?

Grant:

That's why ADmission really starts with that, but we help people go through that formula in everything they do and to create things that they can improve on that along the way in their business. To tie this up, the formula now looks like V (visitors) x CR (conversion rate) x cash multiplier (or your 60 day LTV). That is in parentheses and the key to this is then we would subtract variable costs, right? Variable costs, everything from your COGS to shipping costs, all that there by doing that, you then get profit. It's no longer about how long it is removing your cost from it. And within each of those there are different variables that we do. Again, visitors is our focus right now with ADmission, but even with that is now expanding to other ways to increase and improve that, that's that the things we're working with the members on a daily basis on.

Kristen: 

Yes. And I love it because it seems like the formula is shifting with the entire DTC economy industry in a whole, and this idea that it used to be about, what is this ad winning on? What is the return on this specific ad? What's the return on this set of ads? How is this campaign running and what's that return? And I think a lot of it has come out with the WeWorks and the Caspers and seeing a lot of these businesses that we tout as unicorns are actually now profitable. And it leaves like a meh taste in everybody's mouth. I think we see it a lot on Twitter. It feels to me and you guys can confirm or deny this a little bit. It feels like the formula followed this shift into thinking about everything in more of a holistic business way. And that are the ads you're putting out actually going to help your... like you're saying, bottom line revenue? At the very end of the day, are the ads actually helping your business or are they just helping themselves? I'm I onto something there or I'm I missing the mark?

Adrianne:

No, you're totally on to something. And I think that yes, well, we for sure followed the industry, but the reason that we have such a unique view into what's going on in that world is because we own our own brands. And so without those unique insights into the ways that the industry is shifting and the data, we have everything ahead of the curve almost because we're seeing what's happening to our own brands and our own customers and their paths sort of.

Adrianne:

Instead of having sort of tunnel vision or being behind in terms of understanding, how is the industry shifting. You can make predictions till the day you die about where DUC is going, but tour operators and our other own brands is what gives us this platform to speak to our clients, our ADmission community in a way that really shows that we truly do understand what affects the bottom line at the end of the day and how cash-flow works and how that first three to five years of running a DTC business, all the unique challenges that come with that and how you can drive an acquisition in a way that actually is profitable.

Grant:

Yes. It's not just about improving your ROAS. You'll die if that is the case.

Kristen: 

Yes.

Grant:

It has to work together. And yes, you're absolutely right.

Kristen: 

Yes. I love that. And also I do have to note for the listeners, I said that Common Thread at ADmission feels like they're following the industry. I'm actually going to double back on that and say that, I think you guys have been some of the strongest pioneers in this shift. We're seeing a lot of people like there's me, there's Val Geiser, who's on the digest, there's Taylor, there's Aaron Orendorff out there. There's people that are really starting to push this message of acquisition isn't the end-all anymore. It's acquisition and retention and bottom line profitability. And so I'm going to double back a little bit on that because Adrianne, you are right that because you guys have this insight into your own brands, really, you're on the frontier of this new wave of e-commerce of thinking long-term and thinking LTV and thinking payback windows. Grant, like you said, you guys have coined the term the cash multiplier and the 60 day LTV window.

Kristen:

And just from my personal experience, when I saw the first webinar you guys put out with Coleman and Taylor, they were walking through it. I was just watching it. And from a retention standpoint was like, this is going to blow up the whole industry. This is what we've needed for so long. That's why it's so exciting and listeners, why I think that the ADmission course and membership is really the best place to go for it is because yes, you're going to be learning about acquisition, but these are the pioneers who are thinking long-term with acquisition.

Adrianne: 

Yes, absolutely. And if anyone listening wants access to that LTV webinar, that Kristen just referenced it's in the ADmission community, but I'm more than happy to send you guys access to that. Regardless of whether you sign up as a member or not, that webinar is so valuable and I'm happy to hand it out as a resource. Because it's been a game changer for all of our brands.

Kristen:

Yes, definitely. And we'll make sure guys in the show notes that we have contacts for both Grant and Adrianne, so if you have any questions you can shoot directly to them. I know that you guys have just a ton of amazing customer and member stories, just knowing you guys. I know you put a lot of passion and emphasis into the entrepreneurs you're working with. Can you share maybe like one or two, three, four, however long you want to talk for some of your favorite member stories from working in ADmission?

Adrianne:

Yes, absolutely. I have a lot. It was actually hard to pick a couple sort of when prepn for this discussion, but two really come to mind. One I'll share is about one of our members, James Pointer who's been with us now for like over 15 months. He is a founder of Melon Optics, which is an extreme sports like eyewear company based out of Australia and Bali and his girlfriend actually also runs a DTC brand called Ohne, which is a CBD tampon company and other female care products. They're also Australia based, but both of them are members and they're super valuable part of our community. They've had an agency that they were working with before he joined ADmission and it wasn't the type of relationship he wanted with a partner like that.

Adrianne: 

An agency is a really big decision on a brand's part and they weren't having the experience that they would have hoped for. But they also couldn't leave because that means you lose so much of your [inaudible]. You can't drop your agency without experiencing the immediate repercussions of something like that. He found ADmission and joined because he was like, "No, I want to use ADmission to build an in-house team that's really strong and he liked CTC's philosophy on paid advertising and joined ADmission. Actually he's super active himself as the founder, but he also added one of his team members who's running their marketing team and in James' own words he said, "ADmission really gave my marketing guy like a thirst to learn more because it was sort of this up in the clouds idea of how do you really run Facebook ads in a way that is profitable for your business?"

Adrianne:

As someone who's new in a marketing position out of brand, it can be really daunting and intimidating to start spending your employer's dollars on advertising without the support and the structure of an agency resource like ADmission. Just to sort of give you context into how we track with our members towards what they're trying to achieve when they join ADmission, when they join they got this like form that asks for their current monthly revenue, their current monthly ad spend and their six month profit goal. Not their six months revenue goal, but their six months profit goal, right? And so that-

Kristen:

Yes.

Adrianne: 

You're able to understand where they are, where they're trying to go. And so that their dedicated coach who's there for support has an idea of why they joined and where they want to be in six months. James and his team... it was under six months, actually it was in the four month mark of joining ADmission, they were able to scale to six figures spends which was his goal and hit a 3x ROAS while at that six figure spend mark. That to them was their idea of success with ADmission and then after they completed that, now they declared their next six months profitable and spend goal and then just kept going from there. And he's... like I said, he's been such a valuable part of our community.

Kristen:

Yes, I love that.

Adrianne:

Yes, he's definitely one of my favorite stories. Another one that I'll just share is from... she's just been an amazing... I know you know this Kristen, but building a community is so fun to see the people that really just pour their hearts out into it.

Kristen:

Yes.

Adrianne: 

This member, she just really has done that. And then she's added so much value for other members just on her transparency from the data side, from the brands that she works with. She works on marketing team of a company that actually owns three smaller brands. She joined ADmission because she... actually, I remember my call with her before she joined. She was like, "Yes, my boss is going on maternity leave, and she doesn't really have time to train me, and so I don't know what to do. And I think that's why I need to join. I'm trying to convince my boss to join. And-"

Kristen: 

Yes, talk about a moment of panic right there.

Adrianne: 

"I want to impress her while she's gone," and I'm like [inaudible]. We invited her in and I'm so glad that we did because her slope has increased so rapidly since joining. She's for sure one of our star members. She's a thought leader really, and she constantly is putting out learnings in our group and tests that she's running and challenging people's ideas or preconceived ideas. I look to her sort of as a member example of an MVP member, obviously not every member. To be a part of ADmission you don't have to spend as much time and energy as she is in the community. But she's like this shining star example now of how much value you can truly soak out of it. Now she has her own clients that she's running ads for, because she's more than capable of doing that now, and helping other entrepreneurs herself. So it's really exciting.

Kristen:

Yes. Listeners, I hope you caught something important in there. Us community builders, like Adrianne and I, love to hear from you. This episode, any episode that you've heard if there's something that either you loved, you hated, you want to challenge me, you want to tell me to shut up about something, reach out to us because it will make my day I promise no matter if it's positive or negative, we just want to hear from you. You can really hear it, Adrianne, when you talk, how passionate you guys are about the people behind the ads and it's just really special, I think to hear it and to hear how much you guys really love and appreciate your members.

Adrianne: 

Yes, I can't hide it. So, I'm glad you heard it.

Kristen: 

Grant, I'm going to toss this one back to you. Obviously you're seeing a bunch of brands doing all sorts of different kind of paid media advertising strategies. And this is a pretty general question, but what are the biggest mistakes you guys are seeing again and again when brands come in, in terms of paid media?

Grant: 

This one's easy for me. [inaudible] I mean you too hear because it kind of goes... it starts with one and then goes the other. So, the first one I'd say that we see the advertisers make is, they start playing the game before they actually know how to win. So what I mean by that is, they start advertising before they can determine they know what the actual amount they can spend on ads, as well as the return they need in order to maintain profitability, right? We have a tendency to throw it in, try and learn it and then we don't actually know what we should be trying to track towards or how to do it.

Grant: 

How we solve this and we see this with clients, we see this with members, pretty early on, we created a... we call profit analysis doc. We actually require all members who just joined ADmission to go through this because it's critical to knowing and building confidence into what you can actually do and spend. This doc or this exercise, it's constructed in a way that helps you quickly determine how much you can acquire a customer for and still be profitable. Like that's the goal of it.

Grant:

To oversimplify it, we take your average order value, and it backs out your cost of goods, your shipping costs and your credit card fees, your fulfillment fees and then allows you to put in what margin you want to take or the net dollars you want to keep in your pocket after every single sale. And ultimately, it allows you to take that information and determine what your CPA target will get. So that will give you a CPA target, and it allows you to play with the numbers within the doc, it's hard to say without seeing it, but to see what your ROAS could be, what you need to maintain in order to stay profitable with your CPA target.

Grant:

That is the first thing that we've seen, the biggest mistake and how to kind of combat it. When you know, okay, I can spend this much to acquire a customer for my brand, and I need to be at a 2.2 or a 1.7 is a very big difference. And then you can go out there and actually start to try it out and start to do things to see how it works. That's the first thing.

Grant:

I'd say the second thing, most common mistake is really advertisers, us, thinking that we're smarter than Facebook. And especially with Facebook, it's that might have been true a couple years ago, as far as how we think about targeting or how we want to try and control every part of the process. So, again, we are big believers here that let Facebook find your customers, right, more times than not, as smart as we believe that we might be, machine learning will always outperform human behavior. We're again like methodology wise on Facebook tactics and targeting, we're very light there. We're saying take that back, use your energy towards higher value tasks, like content, like messaging, like understanding the insights that are telling you what they are and how they work. So that you can kind of keep iterating on success versus trying to control it.

Kristen: 

Man, that was such a good answer to that question Grant, I am impressed.

Grant: 

Here's the thing, it's become so obvious we have to evaluate what it is and all roads point back to those two things. There's a lot that can break down within those two things but all roads came back to those two fundamental issues no matter where you're at on your ad buying journey.

Kristen:

Yes, and I have to pull this quote out because it leans really well to a fun pun that I get to do. The reason number one that you gave was that they start playing the game before they even know how to win, the show is called Playing for Keeps. This is an issue that I see across the board from pretty much entering any channel, something really big I've seen recently is the SMS world is getting huge and if you don't enter it knowing how to win, you're going to enter it and lose pretty dang hard and that's not going to feel good.

Kristen: 

Very similar for email, for something as simple as how you choose to deliver your boxes, how you do unboxing. But then again with this podcast Playing for Keeps, a big thing I set out to do was exactly what you're saying is nobody actually really knows how to play this game because it's all happening behind the scenes. This idea of make sure you know how to win before you start playing, really hits home with me and I had to highlight it because you said playing the game and it's called Playing for Keeps, so I had to do it.

Grant:

I love it. And since you're highlighting it, I got to highlight that, that's a Taylor Holiday special.

Kristen: 

Of course, it is.

Grant:

If you follow him on Twitter, you make sure you tag him, otherwise he's going to be screaming down the halls. But no, he won't. [inaudible] it goes into [inaudible] all our [inaudible] so we're getting away from that we are way too support centric. And so all the metaphor off his work, I stole that from him. But it does draw so much clarity, when you're thinking about this or anything, whether it's retention, whether it's Facebook advertising, know what you're playing. Once you know how to get to that outcome, you can figure how to create that outcome.

Kristen:

Yes, and then it starts to feel a lot less chaotic. And I think both Facebook advertising and retention have this similar vein of when you approach it, it feels like this big chaotic mess of, what do we even play with? What do we tinker with? Where do I start? And I think sometimes that either leads to one of two things.

Kristen: 

One, it's kind of that playing the game before you know how to win. And you're just kind of flopping around and wasting money and wasting resources, or B, and this happens a lot with retention, you just don't do anything about it because it's too chaotic to approach. So as you guys are listening to this, and you're thinking about all these different assets of your business, making sure that you actually know what it means to win before you get there and having a plan will help with that chaotic feeling. And there are resources like this podcast for retention and ADmission for Facebook ads, there are things out there that will give you that playbook. But very important to give yourself the space to step back away from your brand. Take a breath and say, "Okay, do I actually know how to win? Do I know what winning even looks like," before entering really anything.

Adrianne: 

Yes.

Grant: 

I love it.

Adrianne:

Absolutely. I actually want to add something to that, the whole idea of understanding the game you're playing before you try to win or something along those lines. I think I just butchered it.

Adrianne:

But one of our members before she joined, I asked her what her goals were. And she said, "You know, I just really want to hit a 4x on Facebook." And she runs a subscription jewelry company and I'm thinking, "Yes, girl, 4x, good luck." Face to face, I couldn't just say that to someone, but I also I'm a straight shooter. And I'm like, "Hey, it's actually really rare that anyone hits a 4x on any part of the funnel and Facebook these days anymore." And she was like, "Well, that's my goal."

Adrianne:

She joined, she completes the profit analysis doc that Grant mentioned and really starts to dig into her LTV, which should be relatively high because she's running a subscription jewelry. And she then a few days later, after joining, she messages me and she goes, "Adrianne, I can win at a 1x. I'll make money out of 1x." She just went on and on about how this whole exercise changed her understanding of the game, right? And now she's winning. But it's only because she really dug into the data behind what she was selling and all of that. I just want to double up on that idea. And that number one mistake that we see people make and also use it as a form of encouragement that you don't need a 4x to win on Facebook.

Kristen:

Yes. That reminds me of something too you guys kind of said at the beginning when we were talking about the formula. Grant, I think you said it, you said this formula is actually more than just some letters put out in a nice formula that gets stuck on the wall. It's actually the way you said it's a way to problem solve. And it's just this new approach, it's a new mindset to think about Facebook advertising. And it's such a cool story to hear someone come in and think one way and see it and then just get that mental shift. And I feel like it just unlocks all new opportunities for brands, which nicely bridges into my next question, because I'm a talented podcaster. Adrianne, what do you think, Grant gave us the biggest mistakes you're seeing, what do you see as the biggest opportunities for brands to improve both on kind of the growth and retention side?

Adrianne: 

Yes, I'm going to focus on retention from the improvement side, really. And I think that it's two-fold, again, not to have another two-fold answer, but I'm going to.

Kristen: 

Everything's at least two-fold, must be.

Adrianne: 

It's so hard to give one answer to anything but really, okay. So, from the ad side, in terms of retention, I think the number one area of improvement people can start to focus on and really our members are starting focus on, is the story they're telling in the ads in a way that makes their ads memorable to the consumer and puts them on this path, like sort of a journey with the brand through the funnel until they purchase and then even post-purchase, right.

Adrianne:

We just released a big article on that Aaron Orendorff and our team here wrote on content and commerce and I picked out a quote to answer this question because it hits on this idea so well but essentially says, "Valuable content centers on a story your audience already inhabits entering it not as a hero, but as a human helper. Pick that story wisely and tell it honestly no matter the medium on which it appears." When thinking about Facebook ads, really shifting from this ad that is sales focus copy and headlines that are like discount, 20% off your purchase, [inaudible] just to drive sales. I think moving from that type of ad creative to an ad creative that tells a story while still driving conversion obviously, puts your customer as the hero. That is such an area of opportunity for increasing retention with your new customers and your existing customers. And then I also contend we will be diving a lot more into retention in our ADmission training company.

Kristen:

[inaudible] Hint hint.

Adrianne:

But on the email side, I hear a lot of members who are new to the DTC world say, "What, aren't emails so annoying? Doesn't that just push my potential customer further and further away from me?" If done wrong, then possibly. But we also are coining this phrase here at CTC called "Make email lovely again."

Adrianne:

I think our members, our community, specifically in the stage of growth, that they're in, their biggest opportunity for retention is email, which is why we're gonna be putting out more trainings and tools for them to be able to use emails as an effective channel, because there's so much out there now that's saying that a healthy percentage of email revenue for a healthy DTC brand is around 30%. And I would argue that majority of our community is less than 5% when it comes to that. They're leaving money on the table, right? And so when I talk to them, and they're like, "Where do I even start?" I just say, "Start with your welcome flow, your browse in flow, and your abandoned checkout flow, start there. I promise you, you're leaving cash on the table by ignoring this channel." I think the opportunity there for retention is so huge and something that I want to continue to provide them with more support for.

Kristen:

Yes, and email is one of my favorite topics in the world around retention especially and I'm strongly in the camp of email is not dead, and email will never die. And I can also promise you that in the digest of this episode, Val Geiser will pick out this statement "make email lovely again" and we're going to nerd out about it, so just get ready for that. We love email, it's going to be so great. So we'll dive into that in the digest for sure. Just kind of wrapping up with you guys. What's something that's really surprised you as you've grown ADmission?

Grant:

I'll go first, for me, clearly I underestimated the power of our member community. Funny enough, Kristen, I was doing my homework, and I listened to an episode of you and Val as we mix, and you said something that kind of resonated and makes my point here, customers before metrics, is what you guys kind of hounded on a couple times. For us in ADmission, we actually made a very conscious decision that at the start, the model is going to be monthly membership. Because we wanted the support element and we knew we could do that piece pretty well. And I think what Adrianne and the team here do is, is they show that by how much they actually pour into the members, how much they actually care, and every challenge is a little different challenge.

Grant:

I think that this stems from us, knowing how hard it is to grow a business. Growing a business is really difficult. And most times, it's not glamorous, it's hundreds of problems and challenges you have to deal with at all points of the day. So, our belief is if we believe that we can, given the opportunity to help people on that path and make it a little bit easier, give them a little bit more time back, help them spend a little less wasteful dollars, that is on us to do and we have to live into that and make sure it's done.

Grant: 

But when I say I underestimated the power of the community, I figured we could do the support piece pretty well. I knew that we had the right people to pour into that but the biggest part I underestimated is how much the community would actually give back to us. And what I mean by that is, we've hired multiple people from ADmission who came through ADmission prior as full time staff here at the agency. We've acquired a brand in our talks with other brands that are inside the community into our own ecosystem through 4x400. We've seen members hire each other, members hiring other members.

Kristen: 

Wow.

Grant:

I did not anticipate it's made our own employees better because

Kristen: 

Now-

Grant:

We've got more service base and client facing with these members and growing those relationships. So, it's all those things together of what I think the membership community has actually provided back to us that I didn't foresee that in many many ways.

Kristen:

Yes, I love that answer. Because there is so much power in community and it's obviously something that I've been working towards as well. It's such a hopeful story to hear that it came in as actually surprising how much power was behind it, I love it. My voice is going out guys, sorry. Adrianne, what about you?

Adrianne: 

Oh, I totally agree with Grant that's at the top of my list. I also have just been so surprised by how ADmission has sort of evolved, I think both surprisingly, but also strategically into sort of its own category of training. And I think that when we started out, obviously, this space it's very congested to say the least.

Kristen:

Yes.

Adrianne: 

Yes, there's so much out there on how to run traffic. It's just all over the internet, you can google and you can have 20+ options for purchasing something like this service. But really now, in my opinion, and obviously I'm very biased, but it's its own category of support and training and the model that we've created, having all three elements, community, support, and actual practical training that you can apply to your business. I'm just surprised by how when people do join ADmission they are blown away by the unique value proposition of this community. And I don't say that to toot our own horn, it's the members that make the community what it is. The evolution of ADmission is because of what they've contributed to it. I've just been surprised by their commitment really to the journey.

Kristen: 

Yes. I'm going to circle it all the way back around to the Playing for Keeps mission. Grant you mentioned that customers before metrics, it's really the mission that we've kind of honed in on this entire season. It's this idea that if you really give your customers the best experience, if you are giving them value, if you're giving them these stories that they care about, the metrics are going to follow, that LTV is going to follow, the retention is going to follow. Everything is just kind of naturally going to follow that when you put your customers above everything else.

Kristen:

And Adrianne, hearing it from you, it's so cool. Both of you are kind of hitting on this idea that ADmission has actually done this itself in that, you invested so much in the members and so they invested back in you, which has allowed ADmission to grow into what it is. And that, again, listeners just we're honing in on that power of just treating your customers the way they deserve to be treated, and even further treat them in a way they don't expect to be treated because it's going to be better than anybody else. That's how you make lifelong customers, lifelong members like you guys have done. And last question before we wrap up. What do you want to see more from DTC brands in the next coming years?

Adrianne:

Yes, it really goes back to putting their customers first. Throughout the journey of ADmission, we've had people join in lots of different online business spaces like drop shipping and other categories and very quickly realized that the community is not the fit for them, like they'll find more valuable resources elsewhere and it's because the community is just completely full of people that really do care about their customers. The experience they're having from every single touch point of the brand from landing on their website, to the first ad that they receive, to the first email that they get from the product at their doorstep. Every single part of that is something that our members are really working hard with limited time, limited resources, limited budget, all of that to make happen because they care about the customers. You talk about it all the time, Kristen, everyone that has been a guest on your podcast cares about this so much, but I want to see more of that from DTC brands and I think we'll only continue to see that more and more.

Kristen:

I could not agree with you more on that. That is what I am hoping to see. That's why I exist, right? Oh, if we can do it that way. Well, before I let you guys go, listeners I do have some cool stuff for you guys. The ADmission team has got an incredible resource on that equation that Grant was talking about, that it is going to dive a lot deeper and it's going to give you a template to get started and understand. That will be linked up in the show notes as well. If you are driving or don't want to listen to me read off a URL, you can also find it at bit.ly/admission-resource. I get my slashes and dashes mixed up. Also, because I obviously really, really believe in this program. I worked with them to create a discount code for you guys. So you can get $50 off your very first monthly payment with admission by going to bit.ly/admission-pfk. That will get you into the course. Again, you're going to hear me repeat this in about 30 seconds in an ad if you missed it this time, plus again, it's in the show notes.

Kristen: 

I do have to preface it with this, ADmission is currently a wait-listed program but because you are a keeper and you have stuck through this episode and listened to us blab about retention and how much we love it, you get to bypass that entire wait list by signing up with that link again bit.ly/admission-pfk. Again, it will all be in the show notes if you don't want to type it all out. Thank you so much for Adrianne... oh my goodness, thank you so much for Adrian'ing around. [inaudible] Thank you so much, Adrianne and Grant, for joining us today and being on the show and giving our listeners so much amazing content.

Adrianne:

Thank you for having us. It was so fun. And again, like I said, if anyone listening wants to talk directly to me or wants that LTV webinar that you mentioned or needs anything else, you can hit me up personally at adrianne@commonthreadco.com and we'll put that in the show notes too.

Kristen:

Yaay.

Grant: 

Thanks, Kristen, we appreciate you.

Kristen: 

Thank you.