Transcription
All right, we are back with another episode of the Marketing Operators podcast. We got all three of us here. Connor, Connor, Cody, how you guys doing today? Cody, you look a little light. You feel like you're floating above the ground a little bit. What's going on in your world?
Rested, weightlifted. Um, yeah. No, had a big announcement the other day. So, I'm, you know, excited, uh, excited to, you know, be done to tee up. Uh, I announced on Twitter the other day. This will come out, you know, later. But, uh, decided to step down as CEO of Jones Road. Um, was was completely my choice and, you know, just kind of was, uh, I'm really excited about it, but just really have been trying to think about what's best for the business as well as what's best for me. Um, you know, obviously it's a family business, so really have always put that first, but, you know, I want to put myself first, too. And I think fortunately here, it's best for both. So, I just haven't been enjoying it as much. Uh, you know, kind of been, you know, missing a lot of the fun stuff and not really enjoying a lot of the aspects of it, which we can get into. And, you know, uh, so excited for me. Definitely will, you know, bittersweet. Definitely will miss some things, but know it's the right call. And, and, and I'll still be involved. It's, you know, family company. I'm still still here in the office, but, uh, but definitely excited to do something else and have some time to chill.
So, I want to ask you about, like, get kind of get deep into the how, you know, kind of sweet. Um, before that, though, I'm very curious. So you made the announcement a few days ago, and I think you've officially now stepped down as CEO. So, do you have, like, did you have, in the background for the last few months, been working on finding a replacement, or is there just not someone in that seat right now, and that's what the next step is? Like, what's that look like right now?
We brought in an interim CEO. So, got introduced to somebody who kind of has done this, has been on boards, and has stepped in. Um, I just, I don't know when I make decisions, I make them, and, you know, I just, my heart wasn't in it anymore, so I just needed to kind of do it. But also, I think it's a good opportunity to kind of like step back and still be involved and see what the business needs. So, we definitely are actively looking right now, if anybody out there is listening, but definitely actively looking.
How are the interim CEO's podcast chops?
I don't know that she's done podcast. Yeah, I think I'll, I'll, I'll go to full-time podcaster now.
Okay. Yeah. Yeah. Okay. Good. Good. As long as, as long as we've got somebody in that role, I think that's what counts. You could make it a part of the hiring.
Hopefully a better, you know, CEO than me, and hopefully I'm a better podcaster than CEO. [laughter]
So, how, how long did it take you to find? Okay, so you made, like, once you knew, you knew. You made the decision pretty quickly. Like, what's this like? I'm trying to just like understand the.
So, I went to the board. We had a board meeting like maybe like a month ago or something like that. And I had kind of like had some individual conversations before. And like, our board is my mom, my dad, and like two family friends that are like experienced in similar type businesses. But I was just like, "Guys, I'm done. Want to like talk about it?" And like, they really tried hard to convince me out of it, you know? And I think one of them took it seriously, but they were like, you know, "No, we, we can't." You know, "We think you're doing a great job. We just haven't gotten you the support you need around." Like, I, I haven't, like, I never really built the proper structure like to do it. So I was just so burnt out. They knew I like wasn't sleeping, you know, my kid was up. So, like, they thought it was just like a temporary thing and I'd get over it. But I was like, "Guys, you're not hearing me. Like, I'm done, you know?" Um, but so it was, you know, a little bit of a transition to like get them on board, and especially Bobby, like get her, you know, over it because obviously it's like, you know, we, we built this together, you know, was so much of a part of it. But like, I also wanted to be the person to say this. I didn't listen. The last thing ever, the worst thing ever would happen would be to get fired from your parents' company, you know? So, I, I wanted to be like the person to do that before it and be like, "Hey, like, I think that this is what's best for the business. I recognize my own strengths. You know, everyone wants the CEO title. You know, I'll miss having that, but there's a lot that comes with it. There's a lot of baggage that comes with it. And like, just being honest on like where my skill set is and where my passion is. Like, I'm not, I'm not passionate about beauty. You know, it's a family company. I love, I love, you know, D2C. I love ads. I love doing stuff like that. I love AI now. Like, I'd rather be doing that, you know, than with my time than, you know, dealing with New York State taxes and dealing with, you know, all the administrative stuff that comes with it. So, yeah, you know, I'm extremely proud like of what we accomplished. Like, I'm happy. Like, I feel like I'm going out on top. It's not like I don't want anyone to feel bad for me. Completely my decision. Um, but I'm also still going to be, you know, involved. It's, you know, it's a family company. I have, I have, you know, plenty of equity in it. So, it's, I, I care a lot about the company doing well and, um, excited about the next phase for me.
Motion just dropped their 2026 creative benchmarks report and it's been getting shared everywhere. Slack channels, LinkedIn, Twitter, sharing it in our private group chats. And it's great because everybody's been asking the same four questions forever. What is normal? How many ads should we actually be shipping? What is a healthy hit rate? And which formats really win? The report analyzes over 575,000 creatives from 6,000 advertisers and over a billion dollars in ad spend to answer these exact questions. And the report has some really interesting findings, like the fact that only 4 to 8% of ads actually become winners and over half of ads actually lose. And for Motion customers, this report is especially helpful. You can upload it into your Motion dashboard with their Runth AI chat and compare it directly against your vertical benchmarks. Hit the link in the show notes. I promise you won't regret it. And as always, go to motionapp.com and tell them the Marketing Operators sent you.
Who, who's the type of person that's going to come in and succeed? Like, is it someone that's been a CEO of when you first started with with Jones Road? Was it from zero? Like, did you, like, were you around when the company? I know obviously there was like Bobby Brown Beauty and then Jones Road Beauty was kind of like the what followed up from that at some point, but like, what, what are those timelines? Can you just like fill us in on kind of what the like last four or five years have been?
Bobby launched Jones Road in 2020. Um, you know, her non-compete ended. It was essentially, uh, was supposed to just be like a fun thing. Like, didn't really set out to be like a monstrous business or anything. It was just like a fun thing. You know, there was a GM at the time. And there was, there was, I think on the marketing team, there was one person besides myself, and she was like a 20-year-old intern. Um, had, you know, a little bit of a growth marketing background. And, you know, so there here was this, you know, 60-some year old woman launching a D2C brand. Like, no one on the team knew anything about marketing, you know, whatever. So I was kind of like, "Alright, let me, let me help out from the beginning." You know, so just like as they were, they were kind of like getting ready to launch, I was, you know, involved.
And you're like 25 at this point?
No, it was, uh, I mean, I was probably a little older. I was, it was five and a half years ago. I'm 30, about to turn 34. So, terrible at quick math, maybe 27, something like that. Um, yeah, so it was like, we'll call it consulting from the beginning. And I would make recommendations. Like, I remember on day one, there was like, there was no Klaviyo flows up. I'm like, "You don't have an abandoned cart flow up. You don't have a popup." And they're like, "Well, can you do it? Like, we don't have anyone that can do it." So I just, like, you know, again, it just was successful and went well and like, just, just, you know, did it. So started working full-time. We'll call it like director of e-commerce was was first role. Um, there really was never a CMO. There was never, you know, prior to me, there was a GM. So, just kind of did more and more. Became CMO, right? Eventually, probably like a year after that. You know, we did 20 million first year, kind of just like took off. Um, when I became CMO, we did 60 million second year. You know, uh, went, you know, went big on TikTok and, and, you know, kind of led that. Did 100 million the next year. Um, probably we had a COO at at one point. He was like, he was like an old guy from like manufacturing, so like didn't know anything about like D2C and stuff. And he kind of thought he was CEO and like didn't work. So when he left, it was myself and one other person kind of became like co-CEOs, GMs for a bit. But, um, kind of just like naturally I became CEO. So officially had been two years, but kind of had been, you know, a little bit longer than that. But, um, I think I was just the best person at the time. And, you know, so much of our engine was, you know, was was D2C growth, and that was like where I was able to add value. Um, but I, again, I don't know that that's like just our engine going forward. But yeah, that was kind of it. So just kind of took on more and learned more. I think I'm, you know, quick, quick learner, obsessive about studying and stuff. So kind of just just took on more. But, you know, also just had to be honest about maybe that's not what I want to be doing for forever for the rest of my life.
You said, um, D2C might not be the only engine moving forward. I'm curious, like, does your perspective on where growth will come from influence whether you felt like you were the best fit for the role? Like, will you guys look to bring in a full-time CEO that has, like, big experience opening up a bunch of stores? Is that, like, part of the path, or is that, are those things disconnected?
It's a good question. I think so. We, we don't want to do like wholesale. Like that would be obviously the biggest growth engine, and like we really should. We just don't want to. Like, Bobby doesn't want to as well. I think like one of the things I thought about is like, even like before, like when I was still happy as CEO and like doing well, was like, I'm not even open. It's not even that we should go into Sephora. It's the fact that I'm not even open to it is like, almost why I shouldn't be, if that makes sense. It's like, I just wouldn't, like, I don't enjoy, like, like maybe I would enjoy, uh, you know, I'm really into wellness. If I was like CEO of like a supplement company, like I had no problem putting that into Target because like I'm passionate about the product. Like, not passionate about beauty. So, like, I was passionate about like one aspect of it, which is like not good. You don't want to be like locked into one thing. Um, so I, I think somebody that can kind of obviously be more open to it. But no, I think, I think just from like a, you know, leadership perspective, like somebody who just like wants to be leading, setting the vision, managing people, managing those like operational cadences, like just not something, you know, that, uh, that appealed to me. So, I was, you know, much more in the weeds. And I just think for the next stage, you know, it's, uh, that's not what I want to be doing.
Because I, I totally understand what you're saying. Um, and if you're not, like, because you're going to find that person who's like, "Oh, this is a sweet opportunity. They're not in wholesale yet. They're not on Amazon yet." And like, they have, you know, that person's going, they're out there. It's only a matter of time until you find them, and I think it's going to be a great fit. Are you, are you excited? Like, if I were you, I'd be excited about the ability to kind of step back into your advisor role and like, kind of decide where and when you want to parachute into certain parts of what you do really like and what you are really good at, the growth marketing stuff, and like build that up a little bit more. Whereas a CEO, you probably weren't able to, like, you probably weren't able to go and sit down and like, be like, "Alright, I'm going to go dedicate the next three days to figuring out how to grow our TikTok shop affiliate flywheel or whatever it was." Is that kind of in the back of your mind on how you see yourself being involved with Jones Road moving forward?
I think so. It's again, it's like day three, so it's, you know, I'm going to try to let it play out. But I think at first, when I announced it to the team, they were like, "Like, you're gone today." And like, especially the parts that I was, you know, really involved in of growth and e-com, and they're like, "Oh man, like, you know, what, what are we going to do?" Um, so I think I'm just trying to figure out, obviously, I'll be strategic, board level, and I think I'll actually be a better job there. Like, I think I have a good vision of like where I think the company needs to go. Just necessarily executing it and getting people to execute on it was not my strength. Um, but I think, yeah, I just, I just don't want to be, I don't want to make it harder for the team, right? Like, it's, you know, to, to, uh, be like, "Alright, cool. Who are we not like reporting to, but whatever." But yeah, I think if they want me to be like involved and think it's helpful, like I'd love to continue to do the AI CRO stuff and, you know, be involved with, you know, growth things. And like, again, I, and this is what I've told the team, like, I haven't had time for that, right? Like, I've had to deal with, you know, performance management and stuff like that. So, yeah, I would love to do that. Again, I'm not going to be daily. Um, but yeah, like that's what I get excited about. That's what, you know, sounds fun to me. Um, so hopefully, yeah.
All right, I got one more question here, and this is the one that I think everyone's waiting for. Is Zane the new CEO of Jones Road Beauty? Is that the, is that the, is that the, um, that the big reveal?
Yeah, Zane as CEO. No, I'm, I'm excited to announce I'm joining HQ. That's my, uh, that's my announcement. No, but it was cool though. So, like, I got, it was, it was really cool, the, uh, the response to the tweet. I wasn't expecting that. Like, I knew how I wanted to kind of message it and stuff and just be honest, but like, got like over a thousand, you know, likes on Twitter, on LinkedIn, which I almost never post. Got like thousands, and has been, you know, picked up by, like, I'm talking to Wall Street Journal later. Like, it was really cool, and just to see the reaction, how people are like reaching out. Um, was, was a cool moment. But I'm, I'm ready for, you know, next things. I'm going to take some time off, obviously, still, you know, involve Jens, transition out, but definitely not going to rush into anything. Um, and kind of just explore, explore opportunities.
People are the most important part of your business and finding real A players is hard and incredibly time-consuming. That's why I want to tell you about Propel. Propel is honestly the best recruitment agency that I have personally worked with. They are marketing and operations specialists. They source talent from US, LATAM, and beyond for top e-commerce brands like Jones Road, like many others that you know and love. At Jones Road, we've hired over 12 people through them. We've hired video editors, graphic designers, we have multiple retention managers, creative strategists from them. What I love is not only are they easy to work with, they're quick, but they work on performance. So, you only pay a one-off fee only once you hire somebody. You don't have to pay, you know, any retainer, no ongoing fees. Plus, every hire comes with a three-month guarantee. So, I highly recommend them. They've worked really great for us. We have a really great team that they've helped us source. Head to the link in the show notes and submit the form to get 10% off your first hire.
You know who else is in a really interesting sort of like period of time for making longer-term decisions? LeBron James. Both you guys deciding where you're going to.
The first time I've been compared to him. [laughter]
I'm just kidding. Definitely.
Yeah. Yeah, dude. And I would, I would drag this out. This could be, we could get a lot of podcast episodes out of.
Oh, you know what we should do? Aaron Ordorf, if you're listening, whenever I decide what I'm doing, we should do the decision.
Yeah, totally. We get the hats, the hats laid out.
That would be so funny.
I, I immediately thought of LeBron.
Spots to the hats.
No doubt.
Like, even if we don't pick you, that's like, that's like, you. [laughter]
You know, the smaller package.
That's good impression. Hey, that's that's good. That's good advertising for those guys right there.
But cool. I appreciate, I appreciate it. Yeah, I appreciate your guys' support and, uh, excited to be a full-time podcaster now.
Amazing. Yeah, we're, we're really excited for you. Good on you for, I know it's a hard decision. Even more, more hard when it's a family company. So, you know, good on you for trusting your gut and making the move. Um, excited to see what's next for you. And maybe even more excited than seeing what's next for you is just see the, the in-between, right? Like the, "Hey, let's take a breath and and like, kind of fill the cup up." And I think you're going to make like a really good decision on whatever it is you do want to do next. Um, from that time off.
I hope I do. I hope I make a good decision. We'll definitely be consulting you about it.
Sweet. All right. Well, let's get into it. We got a fun episode today. We're talking TikTok Shop. I've been having a lot of fun, um, go do kind of deep diving on TikTok Shop with various operators in the space. I was hanging out with, uh, Wyatt from Mary Ruth Organics a couple weeks ago in LA and super sharp growth marketer. They have a product that's really lends itself to TikTok Shop. I mean, they have a massive, massive, um, breadth in terms of SKUs. They have a price point that I think really works for TikTok Shop. I think I think it's in that like $40 to $60 range. He said that they are live streaming 24/7 on TikTok Shop with D-list actors. I, I need to meet with him to like talk about the operation there. But just, it's, it kind of blew my mind that we've done like 40 or 50 live shopping experiences at Hexclad now in the last like six months. And it's, it's worked. I mean, it's probably accounted for like, I don't know, a quarter of our TikTok Shop revenue. Not that we're doing a ton of TikTok Shop revenue, but it's just there's a lot going on here and it's just like a fun new kind of whitespace in terms of growth marketing tactics to go. So, Connor, I wanted to kind of turn it over to you and ask you a bunch of questions because you tweeted the other day and I want to read that tweet before we before we get into all the questions I have. So, let me, let me read this tweet and then we can get into it. So, you tweeted on July 3rd: "We're closing in on our first seven-figure month on TikTok Shop, but most of the value from our affiliate program will not come from the shop revenue itself. Our main focus is to generate ad content that performs well across other channels, and we're starting to see that happen. Over the last 30 days, about 15% of our Meta ad spend was behind creative made by our affiliates. Interestingly, the software metrics on our affiliate ads look significantly different despite having comparable ROAS. 15% lower CPM, 2x the click-through rate. It also lands in vertical video placements at 2x the rate and reaches a very different age demo than our non-affiliate ads." And then you have a little bit of a graph showing where all of your non-affiliate content is serving in terms of age and gender versus your affiliate or maybe just age and then, um, your affiliate content. So, what the graph shows is that you clearly are getting a much younger audience consuming the affiliate content on TikTok from TikTok Shop compared to all your other, all your other, um, content on Meta. So, let's, let's start off with, um, what do I want to start off with? I want to start off with like the deal flow actually, because I think like the, the typical workflow most people are aware of is you set up a TikTok Shop, you start connecting and seeding products with affiliates, affiliates start posting content and selling content and directly selling products through your TikTok Shop, which they're getting paid a commission on. And then you can take that content and you can run GMV Ads with it, um, and drive revenue to your TikTok Shop. And then also the affiliate, the affiliate gets paid out on that as well. So, you're talking about bringing that content off of TikTok into Meta. So, I want to just talk about that. Like, what is, what do those deals look like? Um, like, is it flat rate, percent of spend? Uh, what's the usage look like? Could you just like, kind of fill us in on that bit first?
Yeah, totally. So, um, just for quick context, I pulled a little bit of data kind of preparing to talk about TikTok Shop today, but in terms of scale, we're really just focused, and I've said this in in podcasts in the past, I want to be like flooding the zone right now. And I still feel like we're sort of in that phase. Um, we are in an extremely experimental portion of like TikTok Shop growth, trying to figure out what is going to work, what's not going to work. Um, so just in terms of like seeding and posting, like we've really just gone for volume. In the month of May, we had about 7,000 videos posted. So that is like, uh, and that's what's going to fuel a lot of the content that became ads throughout June. Um, so I think it's a pretty good place to start.
7,000?
7,000 posts. Wow.
That's from probably.
Close to a thousand creators. Like, it's quite a few posts per creator. Um, but so 7,000 posts in May. Um, what do the deals look like? So we're obviously doing, um, we're doing a ton of product seeding. Uh, we've seeded thousands of creators. We had hundreds of them post that resulted in thousands of videos. And we really incentivize people in three different ways. Um, everybody gets affiliate commission. And then you have different tiers between, they get a higher commission on sales from organic views. Those videos feed the GMV Ads campaign. So, whatever product they tag, we are then promoting. And most listeners are probably familiar to some degree with GMV Max, but it's like the simplest, most rudimentary ad system. Um, if I'm an affiliate and I post on TikTok and I tag the Ridge Wallet, we just have a daily budget and a target for promoting that Ridge Wallet product, and it can use any of the assets that were, um, that have tagged that product and we've like made available within the GMV Max campaign. Um, you have a higher affiliate commission on organic sales, you have a lower affiliate commission on GMV Max. So, we are paying to promote these products or these pieces of content, and then they're earning further commission on the GMV Max ads. Um, then the second thing that we have here is contest rewards, and that's something we've been experimenting with as well. So on top of affiliate commissions, we have incentives to be posting more videos while generating GMV, with the idea being like, how are we, how are we further incentivizing creators to create good content and a lot of content? And GMV Ads, and like we've seen many, um, examples of this, really benefits from volume of content. That's why we want to be posting thousands of videos per month, um, that is obviously further driven by these content. So, what that looks like is, um, it changes every month, and we do a number of different things, but if someone posts 15 videos and generates $1,000 in GMV, then they get a $500 reward, something like that. And then we have different tiers so that people want to be creating a ton of content, as well as content that generates GMV, because we want to like make sure those are aligned. We don't want to be incentivizing just pure volume and not quality and trying to strike that balance. So those are the two ways that basically all affiliates are able to be rewarded. And then as they become more valuable affiliates to us, we roll out different sorts of retainers. So if someone's really strong and we want to make sure that they are going to be delivering a few dozen videos per month, we'll put them on a flat rate retainer. And that is like the, the, the total cost here.
Before Q4 hits, the smartest e-commerce operators aren't just asking how do we spend more. They're asking how do we make every visitor more profitable. That is where Aftersell comes in. Aftersell helps e-commerce brands increase revenue per visitor, contribution margin, and incremental profit by optimizing the highest intent moments: cart, checkout, post-purchase, and even the thank you page. Brands like Hexclad, Ridge, and Parc increasing their AOV across every cohort using these zero-risk upsells. We've tested, and they have no negative impact on conversion. It's just more free money in your pocket. And with Rocked Thanks, you can offset your Aftersell subscription. No redesigns, no risky funnels, just better economics. Want to see how much money you can make with Aftersell? Go to aftersell.com/rocketrevenueforecast. Put in your numbers and see how much more profit your funnel will make before BFCM starts.
So, those are all the different ways that we sort of reward creators who are working with Ridge. Um, at all those different points, people are opting into giving us ad rights to promote those videos. So then another big part of the program is once we've got all this content, they've earned their affiliate commission, whether that be through organic sales or GMV Ads, we can take all that content, we can move it across platforms. And that's what my tweet was about was 15% of our ad spend in the 30 days prior actually came from, um, came from content from this program.
Wait, so can, can you, I want to go back just like 30 seconds. So, at what point are you getting the rights to that to the content? That's only the folks that you put on retainer?
No, no, no. That's everybody who comes into the program, everybody who participates in the contest, everybody on retainer, all that includes rights that we're able to promote elsewhere.
So, any, so like anyone, once the moment they they drive a sale for Ridge, they're opting into usage on that content?
Yeah, exactly.
Oh, interesting. Okay. Um, and then how are you, I imagine you're like, maybe not. I could be wrong, wrong. If I'm wrong, correct me, but I imagine you're not taking the, like, literally launch every single piece of content in our Meta ads account. Is that the approach, or are you being more thoughtful and saying like, "Hey, we like this video, that video," and then what drives that? Is it like, "Hey, these 10 videos drove the most sales this month, so thus we're going to port those over." Or is it a little bit more, "Hey, we just have a gut feel that certain videos are going to work and those are the ones that we're going to launch?"
Yeah, totally. It's some mix of the two, right? If something performs well in GMV Ads, that's a signal that we want, we might want to promote it elsewhere. I don't think that's the only signal. So, uh, we also have people going through, whether it's our external agency or our internal team, going through and finding videos that we may find interesting to further sort of launch. I do want to air on the side of launching more videos. Can we put 7,000 ads in a, uh, [laughter] in an ad campaign? Probably not. Um, we should be, like, we, you, we should be airing on the side of getting more ad content into the ad account. So that's why we've, like, we've looked at, uh, you know, if it's Yuka or Growy or some of these other tools, like, how can we streamline the process of, uh, affiliate content being posted, getting into GMV Ads, as well as becoming available to be uploaded into the ad account?
Got it. And then who's, who's running this operation internally for you? I mean, it sounds like there's a lot going on. I imagine this is like someone's full-time job.
Yeah, we have a director of social commerce who kind of oversees it. We have an external agency who does a lot of like the operational work, the outreach, the seeding. They help put together the contest. They're helping sift through all the content. Um, and then.
That's an agency.
That's an external agency. And then our performance creative team helps with like the briefing and the guidance in terms of like what messaging or concepts are we seeing working well and, um, making sure that that's being made available to the affiliates. One thing that that I think is interesting, at least from my experience so far, is like, how are we responding to what's working across ads, like our own D2C efforts, or across other affiliates, and then how are we best guiding people towards creating content that will generate GMV? We went through this period of time, and actually the month of May was an example of it, where we probably overindexed our efforts on the wallet business. So of our 7,000 videos, we had basically half of them promoting wallets. Then it was a pretty even split between things like power banks, MagSafe wallets, which is technically different, and tracker cards. And then what we did was we looked at like, how many videos went to each type of product. And then where did our revenue come from, and where are we over or under indexing? So in the case of wallets, we posted half of videos, but it barely generated 30% of revenue. To me, that says, hey, for every video that an affiliate posts, they're actually not all that likely to be earning GMV, or their expected GMV per video is lower from wallets than it would be for tracker card. And us articulating that information to affiliates in some of the creator calls that we do, or just in the Discord community when we're, uh, talking with them on a day-to-day or week-to-week basis, like, let's be pushing people towards the content that's going to be most productive. So, that's another thing that I found interesting is just like, how do we, at at every single point, how are we best aligning our commercial goals with like an affiliate's ability to generate GMV and earn dollars?
Yeah. Yeah, because you're not, I mean, you're not incentivized. Like if that happens where, yeah, if 70% of your content's around the wallet, but only 30% of your GMV revenue is, well, then now your affiliates are becoming less overall, probably less incentivized to post because they're, they're realizing, "Oh, what I'm promoting is not getting," versus them, power banks, it's like, "Oh, only 30% of our content was on power banks, but that drove 50% of our revenue." So, are you, how often are you like?
Re-calibrating based on that, that, uh, those ratios?
It's kind of slower moving. So like, this was May data. We action this. It, it sort of dictates what products do we want to then be seeded, and then what we don't like prescribe what videos we want created. But like, if we want to spend more time promoting tracker cards or MagSafe or whatever else, let's seed more of those products and then let's make it clear these are the products that seem to be working right now. But that's, that is a, especially with the seeding, can be like a multi-week process. So, we're like beginning to, by the end of June, we had more tracker cards in the hands of people. We could be creating more content that way. And then we've sort of reoriented ourselves there, but it's probably at most like a monthly sort of rotation.
Got it. I, I want to go back to, and I want to drop a note on Hexclad here too, but I want to go back to, I think maybe an episode that hasn't been released yet where you commented that like the, I'm blank, what's the name of the product that, that it's like the accessory product?
Tracker card. Tracker card, where you said, "Hey, our best product in TikTok Shop is our tracker card, which is like a $30 or $40 product." You were finding that people that didn't even own a Ridge Wallet were buying this tracker card. We have the same experience in our TikTok Shop where I was also pulling some notes together for this episode. And it's just so interesting to look at the top products in our TikTok Shop and then compare that to Shopify. It's so different. And I think that's something that that you found is like the tracker card is the number one product in your TikTok Shop, whereas it's obviously the wallets on your Shopify. We saw the same thing and it's like, deep sauté pan or griddle, a huge stock pot, a wok, or double burner griddle. These are our like top five or six products in TikTok Shop. They're not unpopular products on Shopify. But if you look at Shopify outside of the sets, it's all of the individual products that make up those sets. It's the 12-inch pan and lid, the 10-inch pan and lid. I don't know exactly why, but people are more likely to buy these kind of one-off niche products in TikTok Shop. And I just think like there's that's incrementality right there, right? Like if the products people are buying are different, you're clearly reaching a different audience. And I think, uh, what I'm learning with TikTok Shop is you have to go into it with an open mind. You have to like lean into what people really want. And I think you guys have done a great job of that where I think a lot of brands would have like kept trying to hammer the wallets and what worked really well on Shopify for months and months and months, and you guys like kind of went with the water and just listened to what was happening organically. Um, so I think that's like one huge takeaway is like, you're probably going to find a different product mix on TikTok Shop versus Amazon versus Shopify. And that's ultimately a good thing because you're reaching different people then if that's what's happening.
100%. And I've said that, I think like people say, you know, we use this, the term TikTok Shop to like mean a lot. At its core, what I think is most valuable in like a TikTok Shop program is the massive activation of creators. Like the ability to get a thousand people to post 7,000 pieces of content about you. That doesn't require TikTok. TikTok makes that much easier, but like people were doing that well before TikTok Shop ever had a TikTok ever had a buy button. Um, so that's one. And then the second one is forcing brands into more creative or explorative merchandising. So like us identifying, "Oh, we're actually going to find these like these B and C tier products from a D2C perspective are actually the best things for us to be seeding," and it's going to make us think differently about what products do we need to be developing in the future or when the next tracker card comes down the line, whatever that may be. Like we have different tools that we can apply to it.
You know the difference between hitting your numbers and missing them. Clear signal on what's actually driving growth. It can get really, really noisy. There is so much noise. You got platform data, you got blended data, MMM, all the acronyms, MTA, experiments, all of it, all pointing in different directions. The more you're spending, the faster you move, the more bad signal can cost you. That's why we use House and we've been using it for years. That's why the other marketing operators do as well. They are the best tool on planet Earth for measuring what we call incrementality, which we talk about a lot on the podcast. What is the true impact of your advertising dollars on your business? We have causal MMM for channel level budget calls. Causal attribution down to the ad level. And Architect, their AI agent tells you exactly where your next dollar should go. And the results speak for themselves. StockX saw a 41% lift in IRO using House. And you're not stuck with a help desk. You get an embedded measurement strategist who actually helps your team make better decisions. Their whole team is great. We've worked with a lot of them. They are world-class there. Go to house.io/operators, H-A-U-S.io/operators, and start backing your budget calls with real causal data.
Yeah. Well, I'm, I wonder how, I mean, Instagram, like Facebook's obviously following Meta on this, right? With a lot of the stuff that we talked about at the Meta Summit with the product tagging and all that. Like, they're clearly seeing the tailwind that is TikTok Shop and starting to develop some of their own tooling like it. But I, I don't know about you guys, but like Instagram and TikTok, we are totally taken care of in terms of content and impressions. Like, we continue to see their a lot now more through TikTok Shop. I was looking at our our volume of content through TikTok Shop affiliates this year. 16% of all of our content is from TikTok Shop affiliates. Now, that's probably underreported, um, or the total number is probably underreported because that's not including untagged content with the social listening tool. But I mean, I think that speaks to how big of an impact TikTok Shop has had on our product seeding and content flywheel program. And 16% is, is a pretty large percent, and we've relatively speaking have only been really thinking and investing in TikTok Shop for, I'd say probably nine months in like actually being serious about it. My question for you guys, do you think that like, why is YouTube not not doing this yet? I just feel like there's a massive opportunity. And I know personally, if there's one social channel that I feel like Hexclad does not have enough representation on, it's YouTube because it's just a lot more manual. It's a lot more expensive. There are tools like Aentto, um, that I think are awesome and they help streamline that process between brands and creators. But do you think it's only a matter of time until YouTube rolls out some form of YouTube Shopping or or whatever like the equivalent is? I just find it hard to believe that they wouldn't want to be a part of the zeitgeist, especially with how, you know, short-form vertical video is becoming more and more prevalent on that channel. Like, do you think it's only a matter of time, or is there a strategic reason YouTube's not trying to become part of this like TikTok Shop-ified ecosystem of buying behavior?
It's funny because they, they have, they actually have it. It's just not the thing. But they have like YouTube affiliate. I don't know what they call it, but essentially you can, you know, if you use like an impact, it's a little bit more like Meta, like what they're trying to do with Instagram. So, it's not like a, like shopping, you know, like a, like a shop on YouTube app, but it, there's integrations, affiliate tag videos under there.
But it's just not big. Like we did that, like we've done that too. It's just crazy that it's not.
More robust. I wonder if it's, um, I wonder if there's like, I know for Meta, I know that they're, it's a big focus and they're trying to roll us out. I wonder if there's just a lot of innovator's dilemma with both of them, and they just have such established ad businesses, and if, you know, [snorts] uh, commerce, you know, kind of threatens that, or potentially threatens that, versus like TikTok didn't really have that. They had like a very small ad business, and so they really had nothing to lose. I would also say, um, YouTube means so much right now. Like, what we're saying, I guess the best comp for a TikTok Shop would be like YouTube Shorts shopping integration, which like theoretically they should be able to do. But on the flip side, like, in-stream is still where they're generating a ton of views, and like half of those are coming on TV. So, it's like, that's not even, that's not a great shopping experience. You know, you see Amazon trying to do something like that with like, uh, products recommended within a TV show or whatever else, and it's like, just not a great fit. So, I'm sure, kind of to your point, innovators, they have, they have so much going on across all their different placements, and them trying to own the like short-form video like shopping companion in the way that TikTok Shop is, is probably just like a little bit nuanced of a goal for them to really try to figure out.
Yeah, I'd watch Meta closely. Like, obviously they've announced it, but it's been super slow. I, I'd watch Meta pretty closely. And I think the brands that, my prediction for that is the brands that are crushing on TikTok, you know, they will then just be able to port the creators over to Meta if that takes off. Obviously, there'll be some, you know, some differences of creators on the pools, but if you have a Discord of, you know, tons of creators and you can just totally bring them over to Meta and, um, whatever. So, so Connor, I want to ask, so like, I'm not going to say any numbers on here, but you know, obviously TikTok, uh, numbers are, TikTok Shop numbers are public. You guys are crushing it right now. Um, I remember when we launched, we were like doing pretty similar daily revenue to what you guys were doing. Like, we launched in March, and last I know, it's like Father's Day and stuff, so maybe it'll come down, but like, you guys have grown really significantly. What are like the top two to three things that you think are the biggest levers that have done it? Like, is it competitions? Is it volume of seeding? Like, what's the biggest ones that you think have led to this?
Well, I'll tell you. Um, yeah. So, so what have made the biggest differences in driving.
Sean starting to post TikToks because I've seen that.
Yeah. Yeah. Yeah. Yeah. He is. We, we got, we got.
Sean in the Discord group posting videos. Uh, the biggest thing for driving TikTok shop revenue has been, um, most of the things that I've mentioned, like, uh, rolling up the contest. You got to pick.
>> Yeah. Okay. Uh, one, it's the merchandising point. It's identifying the products that work best.
>> That's one, far and away. Like, that, that is what it comes down to. And then it is, okay, now that we've identified what products have some juice for us to squeeze out of TikTok. Uh, then it is the, like, trying to find the right balance of incentives. But the reason I kind of laugh at that is we are generating more revenue on TikTok than we have in the past. We understand what it looks like to drive growth here. Um, it's still extremely TBD as to how profitable this channel is. And that's really the mode that we're in now. Again, I, I use this phrase like, um, flooding the zone. That's where we've been at. Let's spend a ton of money on GMV Max ads. Let's do the aggressive contest. Let's do the aggressive seeding. Let's like, get all the iron in the fire and then we can kind of reshape it to make sure it's best aligned with our business. And that is why we're at the point now where it's like, okay, how valuable is the content coming out of our affiliate program for other channels? Are we, are we able to spend 15% of our budget in, you know, June, roughly, uh, from this content? Okay, that's pretty good. Like, we still have to like quantify like what is the value of that, but like the affiliate program is beginning to produce value outside of the revenue generated by TikTok. And then the other thing that maybe this is a good segue into is identifying for every dollar we generate on TikTok, is there revenue being generated elsewhere? And I think that's a really interesting component to this. So the reason this has all been top of mind is we just wrapped up, I, it was like a four-week GMV Max, um, geo-lift study, which is an interesting one because everybody talks about the spillover from TikTok onto other channels. For some of these smaller businesses, I don't think they're measuring it. They're just seeing it. They're like, "Hey, when we, when we, when we post a bunch of content and spend a bunch of money on GMV Max ads, we become one of the bestselling products on Amazon." It's like, "Okay, you don't need to be a rocket scientist to like figure out you should be doing more of that." For a brand like Ridge, it's like, it's a little bit harder to identify. Um, at hundreds of thousands of dollars on TikTok shop revenue, it's like, depending how much spillover there is, it's like sometimes hard to notice. So this is like when Connor was talking about how it's hard to run incrementality because Hexclad is so big. I feel like this is just one of those humble brags that you're doing.
>> No, no, no, no. Not even a humble brag. Like, it's just totally true.
>> You're saying it's hard to see the halo because you guys are so big. I'm just messing with you. But [laughter] yeah, but, but a little bit true though, too.
>> Spike, spike above baseline. It's tough. Yeah. I mean, that, yeah. Yeah. We would have to spend so much on GMV Max ads. We'd have to like blitz it so hard if our, if our the way that we were measuring it was to like eyeball it on Amazon, you know what I mean?
>> Um, [laughter] uh, so, so we ran this, uh, four-week geo-lift study. We did a holdout. Um, I thought this was interesting. I will also say we're going to have to go, we're going to have to experiment much further and run a number of geo-lift tests over time. This is about our power brands in particular. But what we found when I was pulling the data was that 88% of lift from our GMV Max ads was coming outside of TikTok.
>> Wild. I mean, I've heard, I've heard the stats, but wild. Like, I've heard from others that see like a two to one or whatever, but that's crazy.
>> Right? This was, this was 88%. So, we saw, uh, the biggest lift on Amazon, 49% of the lift came from Amazon, 39% came from Ridge.com, 12% came from TikTok shop itself. So that's like, that's sort of, that's how we begin painting the picture of like, hey, we're, we're being so aggressive with all this product seeding, with all this commission, with all these contests, with all these retainers, the TikTok shop platform itself, GMV Max ads on top of that, TikTok shop platform itself doesn't look profitable. Frankly, now let's tease out what is the value from the ad content that we can now spend additional dollars on with Meta, and what is the halo impact of some of that GMV Max, uh, ads across other channels as well. So now we're trying to think about it from like a, you know, three-pronged perspective. Um, and we're still just in the mode of like beginning to get a sense of what we want the, the, the program to look like more holistically.
>> Do you have a TikTok shop P&L? Like, is that something you guys track?
>> We put it together. It looks terrible. Like,
>> Yeah, your standards for that and then how it's changing. If you're like, "Hey, we need to be profitable on that." And then you're like, "No, we think we need to break even because we could do." And then if you're actually, you think there's a world where you'll run that at like a 20% loss because like this is how we run. Again, like we're, we're behind you on TikTok shop, but like even our influencer program, like, well, we take 15% of the content and that goes to ad creative. And so we can now run at a 0.75 instead. And then we also know there is a, there's a significant halo effect that we're not capturing from, uh, you know, click basis. So we've been like, all right, cool, like we can run that at a small loss. So, I'm curious if you think like how you guys will underwrite that as a business, or if it's too early to tell, but like, do you think there is a world where you would, you would, you would accept conservatively a break-even on that channel? You need, you want to see a profit? You're okay with significant negative? What, what are your current feelings?
>> I think with the current products that we have, there's no scenario where the TikTok shop P&L itself is profitable. Like, I think it just, with all the, with all the costs that I just mentioned, uh, yeah, the TikTok shop itself, the TikTok shop revenue itself is not profitable, or that P&L. Um, I think that could totally change with a product that's like even better for like on-platform TikTok shop buying. Like the tracker card's pretty good, that's driving a lot of revenue. We're finding wins across other parts of the catalog. We're going to focus on EDC newness. Like, we've got all this, again, sort of like iterate. We've got this iterative approach to like, just try to best squeeze out what we can from our catalog. There's totally a scenario where next year we come out with something that can absolutely crush on TikTok shop. And I do hear about these other brands running at 3x, 4x, um, like their GMV Max campaigns are running at a 3x, 4x, and then they're just, again, they have a lot of content costs and creator costs associated with that. But like, they're probably getting pretty close to the channel itself being profitable. So, there's a scenario we get there in the future, but as it stands right now, we're like, not even close. And I think it'll come down to us teasing out how much value are we creating elsewhere, how are we best getting the affiliate content to become ad content, and then thinking of it as like an ad engine and like a, a resource that we have available that we're really extracting value from in multiple ways.
Quick gut check for the operators listening. If you're spending on TV or CTV today, can you actually say what it's driving incrementally? This is exactly why we work and have worked with Neon Pixel at Hexclad for the last three years. We've grown with them a lot over time and CTV has become one of our top growth channels. They help us treat premium living room TV like a real performance channel. It has smarter household targeting. It has suppression of people who already know us. It has a very robust analytics backend. So we feel really good about the measurement and ultimately and most importantly, it is a strategy that is built around incremental growth, not just claimed attribution. We look at incrementality as the true north star on measuring channels and they are really measurement agnostic. They don't force us into their own black box dashboard. They work inside the measurement systems we already trust and help us understand what TV is actually doing. If you want to check it out, go to neonpixel.co and ask them to design a controlled CTV test on your numbers.
I know like Sean's tweeted about it. I've talked to like a bunch of people. I mean, many of the brands that seem like they're doing well right now, like even like DTC is, it's just because of this creator engine that they have, you know, supplying their account. We've talked about that a lot. So obviously there's that there. The, the other thing is, um, like we just have examples. Our May contest for instance, the way that we were rewarding creators, probably overvalued the delivery of content. And we, and we created somewhat of a misalignment between generating GMV for the brand, creating value for the brand, and us rewarding creators, which is like, that's really the flywheel you want to build. Like I just said, we had too many creators post about wallets that didn't generate that much revenue. It didn't become successful GMV Max ads at all that high of a rate. It, to some degree, became decent ad content, but like we didn't properly extract the rate at which we were extracting value from the efforts of those creators was relatively low. And I think by building better contests, doing better briefing, um, finding the right incentives to create quality over just quantity, or like some balance of the two, will result in us more efficiently extracting value from the program. And that's when we'll feel more confident in running TikTok at a loss or something like that.
>> Yeah, we ran a similar contest about a month after you guys and same, same thing. High volume of content, decent ad creative performance, but definitely not fully, um, aligning. But, but I think that like we, I think you even said it, like you're willing to overpay in the beginning. Like, same thing here. I think it was a good learning. I don't know if we'll break even on it, but definitely a, you know, it's not a ton of money in the grand scheme of things. It's got a lot of content, got a lot of learnings, and then I think we'll figure out how to like orient it in the right way to get, not, not just reward volume of content. The other thing I've been saying, and I don't know if you guys agree with this or not, but like I said it when we were hiring for this director of social commerce role is I said Ridge has the cloud cover of being like a big, growing, profitable DTC brand. And we're like expanding in retail. We've got all these things. And it's like, we don't need to have precision necessarily with our TikTok shop program. Like the reason this is somewhat exciting is because we can go, we can flood the zone. We could go scorched earth. You could use all these phrases like, like, let's figure this thing out quickly and take what might have been a year of iteration into like five months of iteration. That totally requires overpaying at different points in time, but it allows us to learn quicker. So anyway, yeah, that's like, that's where I'm at right now where it's like, let's kind of, let's speed up the learning process here. We don't need to value precision as much as a brand dependent on this channel might be. and, um, just get to, you know, our optimal end state sooner.
>> Totally agree with that. Yeah, if you, if you, you know, lose 25 grand from a competition or something like that, it's, for, for, for the size of business, it's really like, it's a good learning.
>> Do you see, so of of the halo into Shopify and Amazon from your GMV Max ads? Are you also seeing, maybe you haven't done this analysis, but if you have, are you seeing that those people are buying the same products you're seeing that are popular on TikTok shop, or are those people kind of falling into the normal buying behavior of, oh, I'm going to buy a wallet on on Shopify and like that's why they're probably going to Shopify, or is it the, the different product mix that you're seeing make up TikTok shop?
>> It's a good question. So the way that we were looking at this data was power bank revenue across all these different channels. You can like, um, you can observe, let's call whatever, like Ring revenue, like you can do this within house where it's like, okay, like we're running this geo-lift holdout, our, um, whatever they call it, primary revenue source or primary KPI is like power bank revenue, let's call it. Let's say you can layer in sort of observed revenue and say, hey, um, are we observing a lift on Rings when we promote power banks on TikTok shop? You can theoretically say that we really don't see much of that. Um, and then also, you can't get all that much more granular than that either. And even that is like, oh, Olivia is going to listen to this and like, I think appreciate some of the caveats I'm laying out here because like the way that they set up those geo-lift holdouts and the way they build the, the holdouts is based off of a very certain type of revenue. So all of a sudden, if you start slicing that thinner or observing a completely different type of revenue metric, I think you've sort of, um, compromised the scientific integrity of it. Um, so anyway, to answer your question, we were looking at power bank revenue across these channels. You can maybe see different stuff, but like getting too granular is, uh, not, it's a slippery slope.
>> Are you seeing a different customer? So I'm on, you know, I'm in Yuka right now and just looking at some of your stats, seems like your audience is like 50/50 male female. I don't know if you're seeing that. Are you seeing anything there different? Like, does it, does it seem like you're reaching a different audience with this? What I'm most excited about in terms of like reaching new audiences really just what we were seeing on Meta. Like I found that super compelling in terms of incrementality or just an example of maybe us squeezing revenue out of audiences and people that we weren't otherwise doing. So, and and Connor hit some of the points earlier, but like really skewing much younger. Our ad account otherwise is hitting far and away our biggest, uh, our biggest sort of cohort from an age perspective is 35 to 44. That's 33% of total spend in this period. Whereas we skewed much younger. Our 18 to 24 was almost twice as high in terms of a percentage of total spend. And then our biggest cohort was 25 to 34 and that was up, looks like 35, 36%, something like that. So that's where I'm like, "Oh yeah, this, this feels pretty good that like this program, our TikTok shop efforts, the content it's producing and we're getting across other channels is like very clearly built to, um, reach different people." And that's the age perspective. The other one was like twice as likely to land in, um, Instagram Reels or Facebook Stories, that the short-form vertical video placements on Meta. I also found very compelling because, um, that is obviously like, that's the format that is native to this, you know, TikTok shop channel.
>> Yeah, I agree with that. It's like brands try so hard to like make creative to fit those formats and I feel like it's such a struggle because it's like, it's really hard to take a big enough swing and like short-form vertical algorithmic video is what it should be. So it's just like outsourcing that completely is is the engine. So I agree with that. We, we've found the same thing with delivery. And is that purely because like, as far as the CPM bit goes, do you think that's just like 100% because that younger audience is less competitive in the ad auction and because of that you're being rewarded much better CPMs, or is it something else?
>> It's probably all those things. I mean, younger audience, uh, I like the vertical video placements are typically cheaper than feed, at least from our experience. So like between placement, between age, that's why we get to that lower CPM.
>> Um, all right. So Cody, Cody, when you were away, had a had a fun little thought experiment that we wanted to kind of end this conversation on. So Cody, you want to take us into that?
>> Yeah. So all right, I'm not jumping into anything now, but I am thinking about what I want to do and just, you know, pocketing some ideas. One thing I did over the weekend, so I've thought about it from DTC a lot of like, how would you reverse engineer great brand? And what I did is I, uh, I, Aaron built this really cool operators portal. So I had Claude and Codex go through that, pull all the transcripts, put into Obsidian, create like playbooks so I can chat with Claude and be like, "Hey, like, what is Zach Stuck's framework for launching a new brand? Or like, what is Chad's, right?" And so I've thought about it a lot from a DTC brand, like high margin, growing trend. Um, and it's probably, there's a lot of things that are the same, but so my question is, if you were to reverse engineer a new brand for TikTok shop, like we've talked about even building products, right? Like I think you guys are starting to do that. Um, clearly like Shark Ninja is building products for TikTok shop. If you were to do a brand for TikTok shop, like how would you think about that? How would you reverse engineer it? What are like some of the principles that you think would be like really important?
Every support conversation is now a chance to increase retention, recover revenue, and grow your LTV. Richpanel doesn't just use AI to answer tickets. They allow operators to run revenue experiments inside your support. You can test different win-back offers on refund requests, subscription save offers during cancellations, and product recommendations that turn chats into sales. Plus, they guarantee you're going to save money. 50% of your support volume automated in 30 days or your money back. That's a pretty good offer if you ask me. So, go to richpanel.com/demo. They'll build an AI support team live for your business and show you how it can drive incremental revenue for you.
>> I think one, low AOV. I think that's like the starting point, right? Like if you have a $100 AOV, you're not, not to say you can't make TikTok shop work, but you're probably not a TikTok shop first brand. So I think that's one, right? Is like, is the price point in that like $30 to $60 first order AOV? I think that's like, to me, the leading DNA of of a product that can be TikTok shop led. I'd start there. Um, it's not where I would. Low AOV is tough. Low AOV is tough. If it's low AOV, it has to be a highly retentive product. Like you'd really, I, I don't think, um, you know, a lot of these like the supplements do so well in TikTok shop because they're able to drive a lot of spillover on the Amazon on the.com. They're, uh, you know, whatever benefits they're supposed to provide are like compelling enough that someone's going to take the product every day and buy multiple times. So like that's almost more important to me than low AOV. A highly retentive product can have a low AOV, but I think a lot of people make the mistake of prioritizing low, low AOV. They don't have the retention that they need. They can never get CAC low enough to actually pay off on any sort of like reasonable timeframe. So, that would be one. Um, another one that I like is I, I think, uh, I'd be experimental with like form factor. Grunes did this with gummies. Create did it with gummies. They did a great job with it. You look at people getting experimental with like, um, the Zin pouches, which like I am not a fan of as a delivery mechanism, but like I'll list here. Uh, I was thinking more about Tabs chocolate, the sex chocolate, uh, from like a couple years ago did really well on TikTok. I would just be thinking about like, what are interesting ways to deliver something that someone would otherwise be familiar with? Like sex supplements are like, they've sold at, they've been sold at gas stations forever, but like having a fun chocolate you can take with your partner is actually much cooler. Um, the other like related one is like, if I'm thinking about TikTok shop, is it something visual? Like how can it naturally become content?
>> We were going to ask about that. I feel like that's a really important one that I, I pretty much knew you were going to touch on. Like, how do you demonstrate it?
>> And, and, uh, because like some of the best brands, it's like that using the product is is interesting to watch. I was just thinking I have Dr. Squatch soap here and, and I was using it and like in their ads, they must have this in the brief. They get so they get the suds going in the ads. It's so visual using the soap and it's like, if you use soap like a normal person, you never get that. Uh, so like that's one. Uh, what else was?
>> Yeah, do you know like High Smile? You guys know High Smile? They're like, like they, and they'll show like the tennis, uh, the ping pong balls and stuff like very good hooks. Yeah. Very similar to Dr. Squatch. So yeah, the visual nature of it, I think is important. I like this brand Drink Vulta, which is like, it's like a some sort of like liquid thing that you like can add to existing drinks. I'm like, that just seems really cool and sort of fun to watch. And then the other like prime example of this is Mini Katana, Isaac's brand from a couple years ago, which like they were just driving billions of views. This is like pre-TikTok shop, but they were just engaging creators. And it's so fun to watch people use katana swords that they're able to drive like as many views as Mr. Beast. And it's like, that's, that's probably my number one priority would be like, uh, the, the form that it was being delivered in and it being somewhat visual.
>> Well, and on the retentive bit, like if you can, if you can, let's say it's a $50 AOV consumable, well then you can go and afford to pay a massive commission on your on your first order to affiliates. So now your affiliates are super incentivized to produce a bunch of content around it. You're fine paying a high percent, whatever it is, because all right, they're going to come back and buy five more times throughout the year and like that's where we get our margin on. So I think that's, that's, that's a good point on the, I should have added that in on like low AOV, but it, it's probably still got to be a consumable so you're getting that repeat business going.
>> Yeah. Which is like, again, for my DTC playbook, like it's got to be, that's got to be subscription for DTC. I, I think probably same thing here. If you're, if you're a TikTok shop sub, like a subscription brand, do you pay affiliate on just the first order? You pay it on lifetime?
>> I believe you just pay it on the first order. And I, I've heard people doing like 80% commission or whatever, like almost the entire, and I'm sure there's brands out there do paying 120% commission or something. Um, so I think you get, you could get clever with it.
>> Yeah, that makes total sense. Yeah, I agree with all them. And then I think one thing I don't think it's a must, um, but like actually being like a TikTok creator brand. I think like there's one brand I'm I'm super bullish on. So like for example, like there's POV Beauty, that's like Michaela's brand. And she's like a giant beauty creator. Like it's just, you know, it's so easy to recruit creators when you have a really large creator. Or like Ballerina Farm as well, right? And you can, like, you can use the non-financial stuff as well, right? You can do, you know, events and webinars and stuff like that with that creator. And like that's such a draw. Like even for us, being able to use Bobby, you know, um, there's one brand I'm super bullish on that I think is going to blow up, um, Remedy Skincare. There, I, I don't know the guy's name, but there's this, you know, really well-known derm on TikTok, like a TikTok derm with like millions and millions. And so it's, you know, it's like a $50 million brand now. They just raised from L Catterton, but like I think they're just going to like absolutely blow up and they're like very TikTok shop forward and focused. But I just think it's like, it's yes, there's a financial component and it's extremely important, but there's also that like community component and to, you know, this, this creator stuff and I think you can activate them really well when you have somebody like that. So I don't think it's a must, but I think it's a huge opportunity. I think it's a, that's a great one. And, you know, in some of Hudson from Comfort, like his interviews, he talks about that, like you want some sort of like, you want a mission statement that people can get bought into because when you talk about being successful on TikTok, you're, you're talking about incentivizing hundreds and thousands of people. And it's like making it purely financial makes it harder. Like if they are bought in from a, a mission, vision, value perspective, um, it just becomes a little bit easier. So I like that one.
>> Yeah. I mean, they say, right, TikTok will tell you like, your, your creators are your customers on on TikTok. And like that's really who you think about. And like that's what I would really, really be thinking about is like, how do you get them motivated? What's your like, what's your like, I'd almost have like a brand deck for creators if I was starting something new. It's almost like what's our like value props for this community first.
>> Totally. Um, I, I've got one more. I think about this one all the time. This is a deep cut. This is the founder of Manscaped from a Moyes Ali podcast. It had to have been like 2019 or something. Um, but he talked about one of the reasons they, they, they launched a number of brands, just they were trying to find something that they could scale. And the reason they went with like the, the body hair trimmer is because it was like incremental to everybody's bathroom. That like everybody kind of needs to, everybody kind of needs to do it, or you can convince a lot of people to do it. Large TAM, but nobody had like a dedicated trimmer for it. So they saw it as incremental. And I just think I love that like approach to a product. I would say the same thing about Create where their opportunity was like not winning over existing creatine users, but that creatine is incremental to what someone who cares about fitness is currently doing. Um, so I think that makes the sale a little bit easier. And if you're stacking up a couple of these wins, I think like that's what feels like a compelling product to me.
>> Yeah. But you're probably not going so far into like demand creation. Like there's got to be existing demand a little bit. You can't, you can't take like a long funnel. You know, it kind of compresses a funnel where you have to like convince somebody why they need something net new. It has to be like a, like, "Oh, I, oh, I didn't know I needed that." It has to be like that. Yeah, I could, I could, I mean, that's true. I think that's true. It, it totally depends on like the price point as well. Uh, what this also reminds me of is that very popular, it's some sort of like oil pull mouthwash thing. Do you guys know what I'm talking about? It's like, Dr. Something, also extremely popular on TikTok, became like the most popular product on Amazon. Some sort of like absurd metric like that. And it's like, most people are not doing any sort of like coconut oil pull mouthwash every day. But it's like, you see a TikTok video and you're like, yeah, it seems like a good idea. You can convince millions of people to buy your product that way. I, I think a lot of this actually, and like, I would think about was like people in infomercial ages thought a lot about like, what makes for a perfect infomercial product? And a lot of these are probably true, right? Demonstrable form factor, easy to show problem solution. I think unique mechanism is important. Like obviously this has a creator component, but yeah, I think a lot of that is like very true of just like in, uh, infomercial frameworks. You could become an infomercial guy.
>> Cody, well, the, the new infomercial is TikTok.
>> I think like persona scalability is also probably a big one. Like I think especially if you're a supplement, like you look at Grunes and all the funnels they have. They have funnels around GLP-1 use. They have funnels around gut issues. They have funnels around, uh, like fertility. Like they have all these different angles that they're reaching tons of different people on. And I think like your ability to activate with, you know, 10 different creators all serving a different angle/niche is probably a big variable that would allow you to be more successful in TikTok shop versus if you have a single use case that your product's used for. Like you just, you're, you're capped out a little bit on like the type of creator that you can scale with.