Issue 091: A/B Test Deep Dive w/ Noah Kagan

+ Meta Ad Tips for Bootstrapped & New Brands

February 20, 2024

Here’s some truth: Using your legal case to launch a new pair of kicks is one way to make lemonade out of lemons. 🍋 

My Giant Life Reaction GIF by TLC

| TWEET OF THE WEEK

Today I have some thoughts on what I recommend if you're just getting started with Meta ads, or have some traction but not a giant budget. I'll do this in bullet format and just let the thoughts flow.

1. Make Your Margins Work and Know Your Numbers

This part is boring, but it needs to be said. Success with ads is as much about having the margin to be able to scale and still be profitable. You need good enough product margins and variable costs to be able to compete in the auctions. You need to know your gross margin, and your landed gross margin. Gross is just product cogs + freight in, and landed gross margin adds in all other variable costs involved in fulfilling each order. Shoot for 75% and 50% of revenue, respectively.

2. Craft A Compelling Offer

This part is more important than your ad account structure, bidding strategy and targeting. Your offer is the product you are selling, the terms, and any discount, bundle, or free gift. You need to make sure people want it, the AOV is high enough to scale. You should create a few of them. You can try a straight discount (not recommended), a tiered discount, bundles, a triple offer stack, and a gift with purchase. You should test a few and go with the one that has the highest margin per session. You should set up all the possible upsells to maximize margin per session as well.

| YOUTUBE UNIVERSITY

AJF: Fixing Beardbrand’s Meta Ads Account

| TOGETHER WITH SARAL

How the top DTC brands make influencer seeding drive 3-8x ROAS for them

Most brands want to work with influencers.

Most don’t because they think relationship management is too complex, or the channel holds too many “unknowns.”

There’s really only 3 things you need to figure out:

  1. How do we find untapped influencers at scale?

  2. What can we offer them that other brands can't?

  3. How do we maintain and build long-term relationships?

These are 3 core levers you can pull to make your influencer program a money-printing machine.

Using SARAL, you get to:

  • Find and reach untapped influencers at scale with automated outreach

  • Ship products, generate affiliate links, and grant coupon codes under one roof

  • Maintain relationships at scale and do multiple collabs with "Creator Relationship Management"

Sound interesting? With SARAL’s free trial, you’ve got nothing to lose.

They're offering hands-on onboarding and extended free trials for Workspace6 readers who start their trials in February. ⌛

Claim your Free Trial or book a demo with their team.

| QUICK SHOTS

  • Jon Derkits: Two stupid simple rules to follow in growing your eCommerce business: 👇

  • @CoryDobbin: Nearly 80% of people surveyed said they've purchased from a company after seeing an ad without clicking it. View-through is a totally normal and common purchase behaviour.

  • 💸FBA REFUNDS - Amazon loses 2-3% of your revenue in FBA mistakes. Get that back with TrueOps. 10% commission, 95% success rate, 100% onshore auditors. W6 subscribers get your first $10,000 back for free here.

  • @iambrandonham: I don’t understand brands that don’t take multiple-page swings. You wouldn’t bet your whole business on 1 video ad. So why do you do that with your pages. Test more.

  • Neal Goyal: Baby brands KNOW their LTV window is short… 👶🏽

  • @heyalexfriedman: Idk who needs this but I’ve seen many startups fail because of founder burn out. I’ve never seen a startup fail because a founder took a couple of days off.

| HERE FOR THE MEMES

| AND IN OTHER NEWS…

Nike layoffs: Sportswear giant is cutting about 1,700 jobs | CNN Business

Nike will lay off about 2% of its employees, or close to 1,700 people, as the sportswear behemoth looks to cut as much as $2 billion in costs.

Brand-building takes a backseat to sales for marketers in 2024, says Lottie London CMO

Despite the latest IPA Bellwether report painting an optimistic picture for marketing budgets in 2024, tough retail conditions won’t make this a reality for most brands, says Nora Zukauskaite, a judge of this year’s The Drum Marketing Awards.

Kellogg’s and Heinz owners outline strategies to drive volume growth

Both WK Kellogg and Kraft Heinz saw declining volumes in 2023 while managing to hold onto net sales growth through price increases. With this strategy looking unsustainable this year, both outlined how they might drive volumes in 2024.

Shopify jockeys for big growth in B2B

The ecommerce technology vendor is stepping up its focus on B2B companies with such features as physical branch point-of-sale systems integrated with their ecommerce sites. New B2B customers include Carrier, the global heating and cooling systems manufacturer.

How Beyoncé Soft-Launched a Mysterious Beauty Brand

Very little is known about her hair care line Ccred, but the artist has said she learned about entrepreneurship at her mother's salon.

| GET LINKED

We saved a dtc e-commerce store $100K in production costs with our emails.

What does email have to do with production costs? This. 👇

Back Story:

The brand wanted to add a new ingredient to their product, and they were 50/50 on whether they should do it or not.

Plans were being chalked out to invest over $100K in production to add the new ingredient.

The owners told us about their plans and immediately we suggested that they wait.

“Let us get the opinion of your audience before you make the move.

Give us 7 days.”

They said “Fine, 7 days.” 😱

Here's what we did during those 7 days:

  1. Started with creating a segment of loyal and engaged subscribers.

  2. Created a focus group program.

    1. A focus group program is one where your most loyal and engaged audience can share their inputs on the product and brand and get some cool perks in return.

  3. Sent emails and SMS asking users to opt-in to our focus group and sharing the details.

  4. Prioritized increasing the size of the focus group by sending regular communication to new loyal and engaged audiences.

  5. Sent out a survey asking focus group users if the proposed new ingredient would be something they would be inclined to buy.

Then, we looked at the results and saw that over 90% of the focus group respondents rejected the idea of adding a new ingredient.

| YOU’RE HIRED

Brand

SaaS

Got a job you want us to list? Let us know.

| THE OUTRO

I wonder if the Trump shoes will have the same kind of juicy social media content push that the Vision Pros enjoyed?

“Here I am in a completely un-produced setting wearing my Trump high-tops and eating Ramen with a friend while people react.”

🤷‍♂️ #trending

Adios, partners! ✌️ 

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