12
DTC NEWSLETTER


Hello DTSeeker


Quick question -- how many sauces are in your fridge door right now? More than ten, a baker’s dozen? Maybe that’s because you’re still looking for the SECRET sauce. Good news, you found it, so read on. 


But first, please join us in welcoming our latest members: Mum & You, Revital U, McKinsey, Page 1 Books, ZX Ventures, IE Skincare, Sunday Farms, and many more who came on board in the last week alone. We’re glad you’re here 🙏


(Did a good friend send this to you? Be sure to subscribe here.)


We hope you brought a bottle, and pray you don’t get lost in the sauce. 


Check out what’s on our fridge door 👇🏻



📦 What happens when you put several Pilothouse members in a quick podcast episode? A: Value Rockets 🚀

📦 The secret sauce for lead gen that Hitchcox is wondering why we’re spilling

📦 28 Day Attribution Window removed on Facebook Ads (big deal?) 

📦 Can ‘thinking tools’ accelerate your brand? You be the judge (+ reserve your spot in the DTC Flywheel Challenge)

📦 Instead of writing a book summary, we turned the content of a book into a tool you can use to weave narrative into your brand

📦 3 unconventional DTC tweets to help you think differently


We’ve picked up the pace in this edition. Buckle up and see ya at the bottom where we usher in the age of DTC quantum computing! 🏁


🔪🚀 All Killer, No Filler LIVES


At the beginning of DTC Newsletter, we were the Pilothouse Podcast. Every week we’d sit down with the agency’s founders to discuss the direct marketing issues of the day and they gave us some serious SECRET SAUCE to share with you. 


This week featured myself, and Kyle Guilfoyle as well as Pilothouse co-founders Kyle Hitchcox, Jeff Shannon, Dave Steele, and Senior Media Buyer, Nate Vankoughnet. 


This week we tackled a series of VALUE ROCKETS that you can test asap.  🚀🚀🚀🚀


Watch the cast for the full effect or read on for each major value rocket itemized and detailed.


💰 1 Day Click View campaign (Test today)


Here’s a simple test that we’re finding some strong results with:


One day click view optimization on campaigns is killing. Nate Vankoughnet explains. 


“Every time I have a winning campaign, I’ll do a test with my normal structure (7 day click view) then as soon as I have a winner, dupe it out and optimize to 1 day click campaigns.”


Pressed on why it works, Nates suggests that this slight optimization hits a different subset of the audience, going after people who are likely to convert that day, vs seven days. 


💣 Bid on your own brand to supercharge the Google algo


Google Ads sprawls Search, Display Youtube and more. It can be hard to gain traction early, and if you’re not careful it’s going to spend your budget quickly, before you get the data you need to scale.


Kyle Hitchcox says that when you’re starting out, you can actually “train” the algorithm by focusing on Branded Bidding in your search campaigns. 


This strategy allows you to do a couple things: 


1. Catch all the bounced traffic before your potential customer buys from one of your competitors. 


2. Feed low cost purchase data to the Google decision making machine. 


When you get enough of this primo data - your Display, Shopping and Youtube campaigns are going to perform better as a result. 


“We do this for all our clients before we start prospecting and it works” 


“Train it on your tribe,” says Jeff Shannon, explaining that this strategy allows you to build your conversion data on your most brand aware and engaged customers, before moving out into other, broader campaign objectives with a strong data foundation.



🧂 Does your pixel have the right seasoning? 


As peers across the DTC realm report rising CPMs and lowered conversion rates, the search for answers is real. 


Twitter is buzzing with hypotheses such as @NickVenezia which suggests Facebook has bad data on the current consumer climate for Covid times. 


The idea here seems to be that early Covid times coasted on pre-covid data, but now that we’re more settled into the “new normal, ” all that old data isn’t doing the trick.


The best thing to do here is test a new pixel. You won’t know until you do. 


We’re not ready to nuke any pixels, but Nate does note a distinct change in one of his larger accounts. 


“The best purchasing time used to be just after work, but with everyone at home that ideal purchasing window moved to late morning/ early afternoon.” 


So what do you do to take advantage of these kinds of shifts in your audience’s behavior?


“In this case it’s simply letting the campaigns run longer in the day before we start to optimize, and we’re just beginning to test day parting.” 


Co-founder Kyle notes that our more premium price point products ($150 - $999) are actually performing better these days, while lower ticket items are struggling.


This could be the beginning of a trend, as the strategy of Covid/US Election tension unfolds and the divide between haves and have nots expands. 


Those with stable incomes in unaffected industries also find themselves with more disposable income, once spent at pubs, restaurants and clubs. 


Those with less security and potent are having their consumer confidence shaken with all the uncertainty in the world. 


What are you seeing in your space regarding CPMs and conversion percentages? 


Thinking of dumping your pixel and starting fresh? 


All you can do is create another pixel and give it a try. The only way to know if pre-covid data is bogging you down is to start anew and see if you see a difference. 


🚨 Secret Sauce Alert: drop shipped promos for lead gen


Facing rising lead costs with a long standing, high volume client, Pilothouse has innovated an easy-to-do incentivization strategy to drive high quality signups at lower costs. 


How’s it work?

1.  Select a drop ship product that resonates with your audience
2.  Test your core offer alongside a bonus “freebie”
3.  The core message of your offer stays the same (make sure that your main hook is still the benefit of your service and not the “freebie” to keep quality high.
4.  Above the sign up form, tell the prospective customer that when they  sign up, they’ll also get this free product
5.  Split test the different incentives on unique landing pages
6.  Drop CPAs!

If the drop in customer acquisition costs covers the cost of the products you’re sending, you’re golden -- as long as the quality still works for the client, which in this case it does. 


IMPORTANT>> :


If you’re testing this strategy, make sure to create a second pixel for incentivized leads. At first we didn’t, and noticed lowered conversion rates on our main funnels. Our data was being skewed to search for freebie seekers, so we realized it’s important to keep these approaches siloed.

Get all these VALUE ROCKETS in this week’s DTC pod!


🔠 An example of an ad we’re testing with larger text


We reported last week about Facebook cancelling their 20% text restrictions, finally letting performance dictate policy rather than presuppositions. 


As we mentioned in DTC11, there’s a short window to pattern disrupt in the feed by testing some light weight but large size word art, before brands and agencies saturate the tactic, making it less disruptive. 


On the Pilothouse side we are just starting to test some full screen testimonials and don’t have enough data to report on any winning strategies. 


🔮  Got a loyal audience? Test mystery products


This week Eric Bandholdz of BeardBrand (@bandholdz) tweeted, 


‘People love mystery products. It’s our new unit sales leader. Who knew? Great addition to help boost your average order value.” 


We agree. Check out Nate’s mystery luxury product example:


At PH we’re working with an awesome luxury brand with a large and loyal customer base. Pilothouse built a lead generation campaign around the launch of a new mystery product. 


“Customers had to pay the full amount up front without ever seeing a single pixel of the product. The promo just smashed and we’re planning another one.”


Why do mystery products work so well? 


Ultimately it’s a brand flex, that your customers trust your brand vision and quality standards well enough to fork over cash for the dopamine hit you get at that unboxing moment. 


It also works because it streamlines the purchase, removing friction by taking choice out of the equation. 


“It’s like paying for your own Christmas morning,” notes Jeff, festively. 🎄 


Give the Mystery Product a test if you’ve got a loyal customer base, hungry for your next product. 


🛍 Shopify is reclaiming the post purchase experience


Ezra Firestone announced that One Click Upsell would be integrated into Shopify’s native checkout experience. 


Carthook also announced it would no longer be taking new customers. 


Who knows what kind of deal is happening on the back end between these apps as they get absorbed. Shopify generally takes care of developers in its app ecosystem, but it seems here that the writing is on the wall. 


Dave Steele gives his thinking as to why, “Upsells have always been part of our secret sauce (at Pilothouse). We go into a brand that doesn’t use them, implement them, and overnight we see a 30%+ increase. Shopify sees this value and is obviously wanting to bring it in house.“





Note the pause on political spending one week before US election


The amount being spent on Facebook and other platforms for the US election is staggering. 


That’s why we’re curious to track what happens to CPMs in the final week before the US elections, when Facebook has pledged to stop all political ads. 


The Pilothouse team has no set plans to raise budgets on those days, but we’re set up to scale up at a moment’s notice when the metrics align with most clients, so we’ll be ready to pounce if we see the CPMS fall significantly in November. You should be ready too. 


🎨 Final Words: focus on creative output


We see a direct correlation between creative output and account performance. It’s the biggest lever you have in this whole game. 


You need to be testing creative constantly to keep your CPAs low.


How many creatives? On an account spending 6 figures a month, Nate’s testing 30-40 new creatives every. Single. Week. 


📚 Homework 📚: Test any 2 of these for next work and let us know how they worked (eric@directtoconsumer.co)


 📦 Watch the full All Killer, No Filler with the Pilothouse crew, or if you prefer audio only, (our fastest growing channel) Listen to the full cast here.


28 Day Click Attribution Removed, Long Live 7 Day Attribution


Facebook has removed the 28 day Attribution window for reporting. We asked Pilothouse Senior Media Buyer Charley Tichenor to break it down for us. Here are his thoughts on the issue:


“Facebook has limited optimization windows to 7days for years now, so there will be minimal impact on how campaigns operate or optimize.


Events that occur over 7 days from the click or impression, will no longer be able to be assigned to Facebook, within the Facebook UI.


UTM tracking will not be affected.


Users can determine the lift from 1 day click, to 7 day and 28 day to truly measure the impact. To measure this, pull reporting against all 3 windows and then determine the percentage different between the 3.


Likely, this will only have a minimal impact and only on myopic “Facebook only” views of reporting, but should limit double counting of metrics.


As Facebook cannot optimize beyond 7 days, pixel events that occur 28 days after a click have always been hard to justify.


Google can take credit for 30 days beyond the click, and will likely be seen, artificially, as more valuable.


Ultimately, advertisers should have a single source of truth. Understanding the funnel and customer journey is a key to success.

 

Implementing Facebook’s Conversions API will be a solution to this issue, as it will allow conversions indefinitely beyond the click.


Very Likely Example of Reporting Lift measurement:


1day click shows 100 sales at a 2x ROAS

7day click shows 150 sales at a 3x ROAS

28day click shows 156 sales at a 3.1x ROAS

 

This shows the lift from 1 to 7 day is 50%, and from 7 day to 28day is less than 2%, and likely very much due to incidental transactions, rather than some strategic effort.

 

99% of advertisers should see no change in their day to day operation.

 

If there is a large lift from 7 days to 28 days, this can be defined as a “benchmark multiplier” and all 7 day reporting can be “lifted” by this figure.

 

ie: if 7 day ROAS is 2x and 28 day ROAS is 2.5x, and this is shown to be constant (month over month, or over the last quarter or year), then the lift is 25%. So, simply increase performance metrics of revenue or sales volume by 25% on fully mature 7 day click data. You can also reduce CPA by 25% to accomplish the same goal.

 

Ultimately, this is a shake up, but the only people who will truly suffer are those without strong understanding of their data.

 

Remember, this will in no way, affect the total sales or revenue on any given day, for any brand, and will not in any way reduce the effectiveness of any Facebook campaign... because Facebook couldn’t optimize to those users anyway.

 

So, all in all, it’s much ado about nothing... if you're honest and prepared :)

 

So jump on the Conversions API bandwagon, measure your lift overtime... modify your reporting, and sleep soundly.”


🧠 Can A ‘Thinking Tool’ Accelerate Your Brand?


We usually keep things tactical and actionable, but ‘thinking tools’ can sometimes be powerful enough to spur action:


Inversion Thinking 


This is exactly what it sounds like: instead of planning for what you DO want, try planning for what you DON’T want. This will not only help you conjure unique solutions, it will also help you form mental barriers that prevent you from going where you don’t want to go.


Another way to think of this: how can you do the complete opposite of everyone else?


Idea Meritocracy 


In his book, Principles, Ray Dalio says the ‘believability-weighted’ idea meritocracy is the best system for making organizational decisions.


He defines idea meritocracy as “a system that brings together smart, independent thinkers and has them productively disagree to come up with the best possible collective thinking and resolve their disagreements in a believability-weighted way.”


(BTW believability-weighted = someone who has proven results / credibility.)


Does your organization use an idea meritocracy -- where productive disagreements are actively encouraged?


How can you eat your customer’s ‘complexity’?


Where does complexity show up for your prospects and customers on the path to their goals? Can you use content, programs, subscriptions, partnerships, etc, to remove that complexity and radically simplify the path your customer is on?


(Bonus Points: Can you ALSO eat your competitor’s complexity?)


Quantum Leaps


How can your brand go from ‘linear’ to ‘non-linear’? We always hear about ‘exponential’ and ‘hockey stick’ growth, but how can that happen if you’re on a linear trajectory?


Brainstorm the ways your brand can take quantum leaps in the next three months. Example: could you acquire a competitor? How about a media asset? What would need to happen for you to triple your sales force? Etc.


Flywheel Systems


Our favourite example of a flywheel system is a toy car: you push it and the little thing just goes and goes -- far further than you’d expect relative to effort.


Here’s Amazon’s flywheel:



What does your brand’s flywheel look like?


👉 Speaking of Flywheel Systems, we’re introducing a way to take these ‘thinking tools’ and turn them into action with the DTC Flywheel Challenge. 


What It Is: A 4 day LIVE challenge to help you build your DTC Flywheel through influencer partnerships, white listing, dark posting, and building a brand ambassador program. You’ll look over the shoulder of expert practitioners and get your questions answered in real time.


Why You Should Sign Up: Based on the feedback we’ve received from over 450 DTC brands, this challenge is designed specifically to overcome your greatest pain points:



If you’d like early bird access to The DTC Flywheel Challenge, let us know.


What’s Your Take On These Unconventional DTC Hot Takes?


@chriscantino says wholesale has a catalytic effect on DTC:



@web says a CRO specialist should be a DTC brand’s first hire:


@Cody_Wittick shares influencer marketing ‘lies’ that he hears:



📦 Instead of writing a book summary, we turned the content of a book into a tool you can use to weave narrative into your brand

‘Directives’ From Donald Miller’s Building A Story Brand


If you haven’t guessed, the DTC team loooves to read. One of our recent favourites is Donald Miller’s Building a Story Brand.

 

We decided to take his Story Brand Framework and turn it into key ‘directives’ (aka content that becomes action). 

 

Copy and paste this into a document and get your team collaborating on these questions to weave narrative into your brand (+ get your organization aligned):

 

1. What does the person we seek to serve -- the hero -- want? Remember to think based on survival and thrival (e.g. conserve time, financial resources, build social networks, meaning, desire to be generous, gain status).

 

2. What is our customer’s -- the hero’s -- problem?

  • Villain // Every story has one: the root cause of the problem→ 
  • External problem // The 'obvious' problem → 
  • Internal // How does the villain make our customer feel
  • Philosophical // Why is this just plain wrong? →

3. The hero meets a guide -- us! There are two ways we can position ourselves as the guide:

  • Empathy → What brief statement can we make that expresses empathy and understanding? 
  • Like you, we are...
  • We understand how it feels to…
  • Nobody should have to experience…
  • Like you, we are frustrated that...
  • We care about you because...
  • Authority → How can we demonstrate competency in solving our customer’s problem?
  • Testimonials
  • Customer stories
  • Stats
  • Awards
  • Logos (B2B)

4. We give them a plan → The plan creates clarity.

  • Process Plan // Are there 3-4 simple steps our customers can take that would lead to a sale or explain how they would use our product after the sale?
  • Example: 1. Schedule appointment 2. We create a customized plan 3. We send a tailored product
  • Agreement Plan // List the agreement we can make with our customers that would alleviate their fears of doing business with us // This plan tends to work in the background
  • Example: 
  • Give ‘The Plan’ a name (e.g. The Barista Blueprint) → 

5. We call them powerfully to action → 

  • Direct CTA
  • Order now
  • Call today
  • Schedule an appointment
  • Register today
  • Buy now
  • Indirect / Transitional CTA (e.g. samples, free information, free trials)? Great for brand equity and warming up the relationship.
  • Get Free Sample
  • Download Free Coffee Guide
  • Start Your $1 Trial

6. That ends in success // What’s the positive changes our customer will experience from having purchased our product? → 

 

7. And helps them avoid failure // What’re the negative consequences of not buying our product? → 

 

8. Character transformation // From --------> To

  • How were they feeling before they encountered our brand?
  • Who will they become after they’ve joined our brand?
  • Aspirational identity → Who do they want to become? Example: From anxiety-ridden, confused, and lost // To: Competent, in charge, relaxed → Free.

Was this ‘directive’ helpful? Hit ‘Reply’ to let us know! And be sure to check out the book here.


🎙 DTC Podcast: This week’s DTC poddy gets a soft launch, but it would be a hard one to miss, if you want the freshest, simplest take on SEO out there. Nick Jordan from ContentDistribution is ruffling feathers by crapping on backlinks, and focusing mainly on “content velocity” to achieve some incredible results. Watch this beauty, let it marinate, then next week we’ll deliver a full breakdown of Nick’s best ideas in the newsie. 


🐦  Influencer Thread: @TaylorLagace answers the question “What’s a practical approach to scale your INFLUENCER program without a massive upfront investment?”


Tik Tok: Growth.design’s animated slides are amazing. Here they dive into the psychology (and technology) behind Tik Tok’s entrancing onboarding experience. It’s enough to get me to join instead of spying from Twitter. 

 

🍋  Del Monte DTC: Del Monte Fresh Produce has launched its first e-commerce website with same-day delivery in the Dallas market — another major player to pivot towards DTC. To promote the launch, Del Monte’s offering to add an order of lemons along with a lemonade recipe with each order. Smart!


🛰 Future Watch: Elon’s at it again. Starlink is Musk’s satellite internet constellation that aims to create total global connectivity (and a lot of new customers coming online). Yesterday he started the stock hype early, tweeting that retail investors would be given highest priority when they IPO in “a several years.” Save your pennies!


🛠 Roam vs Notion: While we’re intrigued by these tools, we don’t fully understand them. This debate on Roam Research vs. Notion helped us get what all the fuss is about. We’re starting with Roam cause it seems like the best way to build a surrogate brain. We’ll let you know how it goes.


📝 Article: As always, Packy McCormick spins a unique perspective of Business as a Game (BAAG). He explores this concept in light of three trends he’s noticing: 1) video games blowing up, 2) business-in-a-box, and 3) everyone’s an investor.


🐺 TV Show: Raised By Wolves is a high concept sci-fi series filled with big, complex, prickly ideas about the morality of AI, religion, and the flawed nature of humanity. First episodes are by Ridley Scott. Totally unique, totally binge-worthy.


🌌 Quantum Goes DTC: D-Wave announces a suite of cloud-based DTC Quantum Computing (QC) products. Opposed to traditional computing, which uses bits (1s and 0s in linear computations), quantum computing uses qubits which can exist in superposition (1, 0, or both) allowing QC to calculate many things at once to arrive at multidimensional  corresponding solutions, much faster, like how bees make their hives from the inside-out. The examples given in the article of companies using now seem piddly, but this will be world changing stuff and D-Wave has signalled that the future is now. 


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