Best. Newsletter. Ever? You decide; it’s a doozy …

🎨 ‘High’ vs Formulaic: Invitation from Cody Plofker

🌪️ Tornadoes vs Funnels: 3 Steps by Cherene Aubert

📈 New vs Old: Rolling Reach via Connor MacDonald

📊 Fact vs Fiction: DTC Data Deck with Taylor Holiday

Plus, an executive summary by Drew Fallon on Hims & Hers 2Q24 earnings breakdown.

THE SPOTLIGHT

Cody Plofker

Don’t Miss Motion’s 2024 Creative Strategy Summit: Registration Is Open

The last time Motion hosted an event series — Make Ads That Convert — we shuffled around internal meetings at Jones Road Beauty so that our entire creative team could attend.

Motion is back with another massive two-day virtual event series for the DTC world.

I’m speaking at it, along with the rest of the Marketing Operators podcast.

A few sessions I’ve put on my calendar:

Matt Duckor, Head of Content at HexClad, will reveal his process for making high-production video ads — from scripting to final edits.
Savannah Sanchez will dissect the anatomy of the perfect direct-response ad. Then, she’ll show you how to create it with an iPhone.
Phillip Jackson, the co-founder of Future Commerce, will show you how to go beyond formulaic creative and generate high-concept ideas.

Motion’s events are incredible for training your team in creative strategy. Don’t miss this one.

Get Your Free Ticket

THE OPERATION

Cherene Aubert

VP of Digital & Ecommerce at ILIA Beauty, previous VP of Growth at Bobbie; Twitter (X) or LinkedIn

Funnels are out.

I have news for you. We’re not building funnels anymore.

Funnels are done. Funnels are old.

We’re doing something new. Something hot.

We’re building tornadoes.

It’s the same shape as a funnel.

But a funnel is a passive tool. It sits there, waits to be filled, and you can only enter at the top.

A tornado is a force of nature. It sucks you in — no matter how high up or how low down you are.

I don’t like to brag about my brand’s performance, but this year we increased traffic and conversion rate at the same time.

That’s a statistical anomaly.

Traffic and conversions are inversely proportional.

In July alone, we drove triple-digit YoY revenue growth from paid social without discounts.

We built a tornado that spread us wider and pulled people in faster. How? Through the one great unifier that can drive traffic and conversions up … intent.

We built intent at each stage of the tornado, pulling people in wherever they’re at in their buyers’ journey.

That’s why I’m going to give you …

Three steps on how we formed a tornado.

1️⃣ Content that builds desirability for each stage of the “funnel”

Last year, our paid content was pretty uniform. What changed is we began segmenting by funnel stage.

Building creative for awareness, consideration, and decision.

Awareness-driving content

At the beginning of the year, we started running top-of-funnel campaign objectives with branded content.

I’m not saying this works for every brand, but mid-eight figures and above should pay attention.

We took big swings with macro-influencers and partners to do immeasurable things to drive more excitement for the brand.
Consideration-driving content

We shifted away from hacky direct-response ad formats and began fueling our ad content with videos that our consumers would actually watch.

Videos that sold on product performance and benefits. This builds consideration in our funnel.

We look to TikTok for content inspiration and bring it into Meta to scale.
Decision-driving content

A very small portion of our budget is dedicated to advertising offers — sparingly. We have moved away from discounting and leaned more heavily into sampling.

It’s a low-funnel entrance to first purchase and introduces customers to other products right away.

2️⃣ Ease of navigation and onsite relevancy (message matching)

You are paying dumb amounts of money to get people to your site. When they get there …

It has to be relevant to what they just saw.

Path of least resistance

We looked at heat map data and learned that the majority of users were taking the path of least resistance to our hero products.

At the beginning of the year, we restructured our navigation and merchandising strategy to reduce the number of clicks to those heroes.
Merchandise for popularity

Multiple times a month, we remerchandise our top trafficked pages (homepage and collections) to make sure the most popular products are first.
Marketing messaging matching

We also consistently refresh our homepage hero + modules to match our marketing messaging.

The goal? Driving that one next click down the funnel.

This keeps desirability high and drives further intent down the funnel

3️⃣ Cart incentives that push shoppers from consideration to decision

We’re all guilty of window shopping on brand websites. Customers need a nudge to move from consideration to decision on your site.

Especially when they get close to buying.

In-cart sampling

Product is the number one driver of customer retention.

As a beauty brand, we sample products in-cart to get them past purchase-commitment-phobia and to pull the trigger on checking out for the first time.
Trial offers (for CPG brands)

Sampling or trialing as a conversion lever works for most CPG brands. Our sampling carousel is a custom-built feature.
Premium gifts with purchase instead of discounts

For some brands, the economics of gifting products are much better than offering a discount. We run custom, limited gifts to unlock higher-than-average order value.

Funnels are out. Tornadoes are in.

Content that builds desirability at each stage
Ease of navigation and onsite relevancy
Cart incentives from consideration to decision

THE FEED

Taylor Holiday (Part 2): The State of Ecommerce By the Numbers, Fact vs Fiction

Prime Day Tactics & Results + How We’re Hiring, Managing & Building Our Teams

THE RESOURCE

Connor MacDonald

There’s a new term approaching buzzword status …

“Rolling reach”

What is it? First, some quick definitions.

Reach: # of unique people your ads are served to
Frequency: # of times your ads are served to each unique person
Impressions: total # of impressions served; in other words — reach x frequency

Rolling reach measures how many unique people are seeing your ads over longer periods of time.

It also considers the overlap in a given month’s reach versus from the beginning of that period.

How do you measure it? Glad you asked.

Here’s a Sheet Template and a Loom explaining how we look at rolling reach at Ridge.

Is it a helpful metric? I’m not sure yet.

It’s definitely an interesting way to quantify the number of new people your advertising is reaching.

However — depending on your size — don’t let it distract you from your business’s ultimate goal of making money.

THE RESOURCE

Taylor Holiday

If you tuned in to last week’s Operators Podcast and were wondering …

Can I get a copy of the full H1 2024 YoY data deck?

No problem. Here’s every slide, chart, and data point: DTC Index H1 2024 YoY Shopify Data ↓

Plus, until Friday, you can still get $50 off your first month of the DTC Index itself. Use code OPERATORS50.

THE TRENDS

1. Hims & Hers Earnings Breakdown Executive Summary by Drew Fallon: CEO of Iris, previous CFO at Mad Rabbit

Hims & Hers continues to exemplify the perfect application of the DTC business model, delivering stellar Q2 results.

Revenue jumped to just over $315M in Q2, representing a 52% year-over-year increase. Subscribers grew by 43%, and free cash flow surged 355%. It also shelled out $31M in cash and stock to acquire a compounding pharmacy to manufacture knockoff weight loss drugs.

The rest of this week’s top-trending news stories, curated by the editor of CPG Wire

2. Shopify (NYSE: SHOP) Stock Soars: CNBC

Shopify stock soared 17.8% on Wednesday after beating analyst expectations for both revenue and profit. Revenue jumped 21% YoY to $2.05B, which topped estimates of $2.01B. In Q3, the company expects revenue to grow north of 20%.

3. Salt & Stone Receives Significant Investment from Humble Growth: PR Newswire

Salt & Stone — a fragrance-driven personal care brand from Los Angeles — landed a significant investment from Humble Growth. The company was founded in 2017 by former pro snowboarder Nima Jalali. Salt & Stone sells one product every seven seconds and has profitably achieved consistent triple-digit revenue growth.

4. Cinven Buys Stake in Vitamin Well Group: PE Hub Europe

Cinven acquired a significant stake in Vitamin Well Group, a Swedish nutrition company that owns Barebells, NOCCO, and Vitamin Well. The seller is Bridgepoint who will retain a minority equity stake. Vitamin Well Group posted €500M of revenue and roughly €150M of EBITDA last year.

5. Big Week for CPG x Sports: Twitter

Athletic Brewing was named the official non-alcoholic beer of Arsenal, while Open Water was named the official water of the Los Angeles Clippers. Lastly, UK-based beverage brand Drip became an official jersey sponsor of the Tottenham Hotspur Women.

Did you make it this far?

Wonderful. In that case, a number of you have reached out about contributing to the newsletter.

Cherene set the freaking bar!

If you’re up for delivering her level of insight and depth …

Hit reply with (1) your topic + (2) your expertise. Our executive editor, Aaron Orendorff, will let you know if it’s a fit.

Until next time,
The Operators