Cody Plofker Is Obsessed With CPMr. Should You Be? transcript

Cody Plopker needs no introduction, CEO of Jones Road Beauty, one of the hosts of the Marketing Operators podcast, and he's back on the show. Today, we're going to talk about a few areas that have been top of mind for both of us related to related to Meta media buying strategy. The kind of stuff that that Cody and I geek out over fairly often, and that I think really impacts your business. That's why we geek out over it.

Organic social machine building, which Cody's been talking about a lot recently, and I haven't heard enough about. And we're going to talk about hopefully we'll have a little bit of time to talk about fatherhood and work and being running a company while trying to be a present and good father and husband, which is hard. So, so hopefully Cody has the answer and he can tell us all how to do it. All right, with Cody Plopker right now, let's get into it.

Again, needs no introduction. Let's just do it. What's up, man? Thanks for making time. Yeah, man. Thanks for having me. Dude, I'm sorry it was a took a while. I kept saying like, "Hey, when things calm down?" And what I learned is right now things are not calming down. So, I just wanted to make make the time. So, happy to be here. Again. >> They never they they never do. It's yeah, it's there's nothing to be sorry about.

I figured this kind of happens when it happens, and yeah, all that. Let's do let's start with the like the juicy marketing stuff first. Let's go with let's go let's go media buying first. CPMR, this is like a thing that people talk about a lot right now. You have talked a lot recently about about the importance for you of extending your reach particularly on Meta. Maybe you're doing this with some channel diversification stuff.

Maybe start by framing up the problem that you guys have had at Jones Road Beauty, and then let's talk about your solutions for it. And then I have a very particular question about the application of this to smaller brands than you. So, so let's start though with you framing up the problem and what your solutions have been. I want to start with that, actually. So, like I do this content stuff for fun, like Yeah. Like and hopefully it helps other people, but like I am no means like trying to be like an influencer or content creator, and it's like, "You guys have to listen to me.

Here's you know, I never my my frame of content is never um here's here's exactly what I would do if I was starting today. Or I I guess sometimes it is, but it's never like, "Hey, this is what you guys need to do." Right? Sometimes you see that from agencies or like course sellers. I'm just like my my frame is, "Hey, this is what I'm going through today. This is what I'm seeing for Jones Road." Because I think that's true, and it's almost unarguable.

Um and right, that's like my experience. But I'm not necessarily saying like this is what other brands have to do. I'm just sharing publicly what I'm learning as I'm doing it, and I think some stuff will apply to others and and some won't. So, I know that even like some of the conversations you and I have had, you're like, "All right, well, maybe this makes sense, but doesn't for the brands." And I would totally agree with you.

Like, never said it did. Or even like that some of the feedback we get on Marketing Operators is like, "You guys are nine-figure brands, like large brands, like none of this content is really applicable." But I'm like Like obviously we're creating content for an audience, but I'm not I don't have the arrogance to think like I know what all small brands should do. I'm probably the worst person. I'm not saying we're the biggest in the world, but I just I just know the struggles that Jones Road has had and what has helped us break through some of them.

I always want to add some nuance to this because you're I think you I think the the size of the of your business is exactly why people should and shouldn't listen to you at the same time. And I think I think what you're saying is the same thing, which is like you have unique perspective because you've just solved a lot of problems already that other people are in the process of solving. And so, people should listen to you.

Right? It's just very very clear. And then people should also begin to have some discernment about when you what you're saying it actually applies differently. And so, my hope is like, well, let's figure that out. Cuz like you know, we serve at Age of Growth like we service we specifically say like if you came to me and said, "Andrew, we want a new agency. Please come manage our spend." Right? Honest to goodness, I don't know if I would take it.

I would be really tempted to because you have big you know, it'd be great to work together and what this all for all the reasons that are obvious, right? Be good for our agency to work with Jones Road, whatever. But it's just not where we spend our time, and I don't think it's really where we're best. And so, and so for me, I'm constantly thinking about everything through the lens of of us and our clients, where I feel like our our knowledge of the road from I always say like from 5 to 25 to 25 to 50, like depending on the shape of the business, those those those parts of the business can be pretty similar.

Um I just feel really strongly that we are great in that area. We know what road map is going to we know what financial pitfalls there are, we know what media buying pitfalls there are, we know what Meta pitfalls there are, and we we're sort of structured for that. So, yeah, so even when I if I respond to your content saying like, "What about for small brands?" or whatever, I don't even really mean it as a critique. I mean like I'm just curious how you are approaching it because that's who I'm thinking about all the time is like is is let's call them small mid-size DTC.

So, but but but let's come back to that in a second. Frame the problem that you guys had, cuz I don't necessarily think that smaller brands don't have this problem, either. Like I'm I'm looking at some of our I was looking at some of our accounts even sort of in prep for this today and going like, I want I'm interested to see how Cody would think about this a little bit. So, anyway, so tell me tell me the problem you guys had so that we can get to it.

Um Meta is an amazing customer acquisition engine that has a lot of strengths and a lot of like almost like features that can be bugs, but are also features depending on how you look at it. And one of the things that I have noticed is that when we are spending more money to reach less people, our performance suffers. And so, we've had issues with exclusions, and I think these are two separate things. >> let's just be clear.

What do you mean by performance suffers? Our ad account, our business, whatever it is. I mean, Meta is still a large percent of our total spend. And so, you know, when when that doesn't perform well, our new customer acquisition doesn't perform well. >> Yeah, right. Okay, so so just I just need to clarify that the metric is your new customer revenue goes down. Yes. >> Or or it's just Yeah, but yeah, right. Okay, great.

Okay, great. So. >> just in platform. There's some correlations, but yeah. Yeah, okay, great. >> growth. That's what I figured, but just just want to clarify. Great, keep going. So, just zooming out like super high-level like cuz we could talk about, "Well, is CPMR what you want to optimize for?" And there's probably things you could do to optimize for CPMR and your your you know, there's a lot I could do to I could I could turn our whole account to reach today, and my CPMR would be very very low, right?

Like that's clearly not the strategy, and I hope no one thinks that that is a strategy. We should clarify CPMR is cost per 1,000 accounts reached. So, there you go. Yeah, there you go. Keep going. So, there's more nuance to that. Yeah. Keep going. Yeah, and so it's it's also it's your CPMs, which are slightly harder to change, but it's also your frequency, right? And those are the two inputs that are behind it. Um So, what we found over the years is we've got to different plateaus, and I think if I it would be cool if I talked about them at the different stages where we had plateaus and how we broke through.

But just high-level, what we found is every time our growth has stalled, when we look at our account, we are not doing a great job reaching new people. Our rolling reach, whatever it is, goes down. Our CPMR goes up. And we are spending same or more, and we're not necessarily reaching new people. And so, our cost per acquisition goes up. Like not a crazy No, yeah. Pretty reasonable. Yeah, like and it's it's it's very clear.

Like have zoomed out, looked at high-level analysis. Like very clear just like loose correlations of like, "Oh, yeah, that month was shitty. Look at our look at like our CPMR." And so, I think there's a few different things and mechanisms behind it we can kind of talk about some of the nitty-gritty. Like but there's obviously exclusions that we've had more of our spend than we've like go to repeat customers, and we can talk about incrementality of that versus not, cuz that could be a nuanced conversation.

We can talk about, you know, reach issues where you're not necessarily reaching existing customers, but you're not really reaching new people. And different things we've done to address it. But here's our journey. So, when we were probably a $50 brand, you know, we're growing pretty quick. Maybe we were a little bit No, maybe maybe 75. Um On the year it was the year that we did a hundred, we definitely hit our first issues.

We were very Meta-dependent. Probably 80% of our spend was Meta. We had some spend on YouTube, some spend on TikTok, maybe some X, you obviously your Google spend, but it wasn't like a very distributed mix. Um I just didn't know that we needed to do differently. We had a decent amount of organic traffic, and so it was like, "All right, if it works, let me just go spend on Meta." You know, some brands like Ridge are like super diversified earlier early, and they kind of wish they concentrated more.

I was the opposite. And we got to a point where we're like, "All right, cool. Performance is no longer what it is. We're not growing the way we want. Why is it?" It was about when we got into Disruptors program, but it was like, "All right, we're we're struggling with reach." And so, we started doing some reach campaigns. For whatever reason, maybe it wasn't the right approach at the time, but we did see some improvement.

We saw we started working with House at that time, so started seeing incrementality. It was also then, you know, and and that was able to kind of right-size it. But again, we saw just some some issues with that. We weren't reaching as many people. When we launched on TV, linear TV, and though it wasn't a crazy percent of our spend, our reach also significantly improved as well. I think just getting a new signal. And then just over time throughout, you know, the last few years, like we had a periods where account fluctuates, and reach gets better or worse.

And as we've looked at it over time, like we've tried different ways to try to crack it. Um when our reach gets worse and our our frequency gets higher, our exclusions don't work, our cost per thousand accounts reached is is worse, our our business doesn't look nearly as good. Hey, you watching or listening to this right now, subscribe wherever you're doing that so that you don't miss future episodes cuz I have lots of great episodes with people like Cody, great smart thinkers.

And then leave a comment. I would love your thoughts on this episode. As Cody and I are talking about these details, I read every comment. I engage with, try to reply to every comment. Leave a comment. So, subscribe, like, leave a comment. Let's get back to it. So, I mean, it's it's interesting cuz it's such a it's such a simple observation. And if you're just saying like over and over we see it. Like it's just right there.

And it also is pretty intuitive. Like I think it's I think it's it's makes a lot of sense. Um I do think that this So, I'm thinking about some of the brands that I'm thinking of. I want to go back to something you said. You said you didn't see this problem until you got to like 75 to 100, somewhere in there. Really driven by Meta. Um, I'm assuming you guys have a lot of repeat revenue, so it's probably not 75 to 100 in new customer revenue.

Correct. Correct. Uh, or or, you know, whatever, even primarily. So, um, so Uh, so you started seeing it there. Let's just talk about It was a different time in a different world, but how were you doing your media buying then? Like, just talk about account structure from a media buying perspective. Um, before you saw that problem. So, were you running much value optimization? Were you running manual versus automated bids?

Were you Do you know what I mean? Like, what How like Talk about what the account setup was at the time before you saw the problem. Uh, what because I'll tell you where I'm trying to get to. Where I want to get to is what can somebody do to assess this problem in their own account? I I have an account right now that spends like less than 50 grand a month that has like a frequency of like 10. Like, they So, like, it definitely can happen in smaller brands.

It's a It's a very niche brand, so it makes sense. But, yeah, so um, so I do think this can be applicable. So, I want to kind of walk back the road to discovering it for you and how you analyze it so people can sort of apply it. Also, can I shout out a tool that I don't get paid for at all, but actually like $20 a month and can help people? Yes, of course. >> what it's this guy? I think it's it's Kurt Bullock. He partnered with Andrew Foxwell on like a dashboard.

For some reason, the URL is like producedepartment. I don't know why. Even though we have data warehouses and stuff, my team uses this. It's like 20 bucks a month, and it has like really great dashboards for all of this to measure like I can I can show the link after like campaign incremental reach. I'm a very visual person, and so like you have to see these trends over time. Like, I can't just look at a spreadsheet.

Like, I need to see. And so, like, we track very closely what our rolling reach is. Like, there's probably five, six different ways to look at a similar story. Um, we'll look at our We started recently looking at our like tables of our prospecting spend to engage audience to repeat customers. Like, just a bunch of different ways to track this weekly over time has been incredibly helpful and something that we are now trying to never take our eye off the ball.

Um, and so that's one is just like anybody can access this. You can get a lot of the stuff in Meta, right? Just looking at Meta reporting. Uh, but I think having a way to to track these measures over time cuz where I think we went wrong a lot of times is just like, "Oh, performance is bad. COGS You know, CPAs are up. Let me pull back spend." Well, it's like, "Well, why?" We got to do like Connor McDonald calls it funnel diagnostics.

Yeah, right. >> Is it CVR? Is it, you know, this Is it a Like, just getting diving into the things and trying to diagnose what the core of the issue is. Yeah. >> Um That's that's number one. And then, yeah, we we were always pretty >> that in the show notes, by the way. We'll link that I'll link that little app, so. Yeah, again, nothing buy it, but it's a it's a very cool tool. Um We were always pretty consolidated. So, we launched, you know, 2020, so it was like we only had like a year and a half of pre-iOS.

And so, we were always pretty consolidated, maybe even more than, you know, we should have been. So, it was manual for a while. We definitely switched to ASC, but I think we really didn't see an improvement, you know, like it wasn't like manual did much better. We have always uh always had lowest cost in our account, but we've gone back and forth with different manual bids, just you know, based on what has performed and and and not.

So, I've heard most. Um, but it's really been broad. We've really had no dedicated retargeting. We could have been tighter about exclusions, but that's been it. And again, until that 50-75 million dollar time where we started doing reach, it's it was all purchase optimized. If you are building a business in e-commerce, if you're building an agency, anything in the DTC space, you should consider staffing as you hire with my friends at More Staffing.

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Um, yeah, I I think that's that's awesome. You mentioned it's uh just let's just check one of the things here. You did mention in a tweet recently that um, that you think there's a potentially a concern about value optimization uh being a contributor There is. reducing CPMR. Um, I'm a big fan of value optimization, and I I don't think you're saying get rid of it or anything. But, the um, but but one of the things you're saying about it indicates your understanding of the tool, which is that value optimization is going to reduce your reach.

It's going to run a higher CPM than your other than than volume optimization. It just is. And so, talk about sort of what you noticed with that a little bit. Yeah. So, you know, value optimization, you're going to pay a higher CPM, have a higher AOV, right? Um, you are you know, you are optimizing for a different kind of more qualified audience that We ran a conversion lift test on it, and the ROAS was really good, you know?

And it looked better in whatever platforms, Northbeam, you know, conversion lift looked better on a 2-week period, so we scaled that pretty aggressively where it was a very high percent of our account. And I think that was a huge mistake because, yes, in a 2-week period, it looked good, but your total addressable market is just smaller because that's, you know, there are less people. So, I think probably the best strategy very, you know, it depends is some combination.

I'm not saying don't do value. Yeah, yeah. It was a very high percent of our account, and I think, yes, short term, that looked good, but long term, zoomed out, we're just paying a premium on every impression we're serving. And I think there's, you know, your direct attributable incremental revenue, but like you are also reaching a lot of new people that you're not going to show that in a 2-week test. And if you're just paying 20% more for every dollar of reach, like, that is not a great thing.

Obviously, obviously, it's all about the caveat of intent. It's, again, I can go and pay way less for reach, but that doesn't mean that's it. I part of my hypothesis Like, I do think that there's a ton of value in at a certain scale reach campaigns, video view campaigns, mid-funnel campaigns, but I also think that you have to be really intentional with improving your reach and your CPMR while keeping the purchase objective and intent.

Yeah, I um I agree with that. I uh I I think of I theoretically I think of value optimization as a tool that reaches with the same ads just extend extends your reach, actually. That's that's the way I think about it. The the illustration I was using was like, say like, if every customer exists on a spectrum of least least valuable to most valuable at like valuable in terms of AOV and likely to convert. Let uh your lowest cost people are going to be over on this side.

Your highest value people are going to be over on this side. There's some overlap in the middle where you're definitely going to reach both. And so, if you take the same ads and you take your lowest cost campaigns, which would be a manual bid I mean, cost cap, bid cap, or auto bid, it doesn't matter. Any of them. Uh, and you and then you just add on the value optimization, you're you're actually reaching additional people that otherwise your lowest cost campaigns weren't reaching cuz the math the math problem people make is that is that if you're running lowest cost, and let's just say you have two potential customers.

One of them is a is is is likely to spend $50, and the other one's likely to spend $100. Well, a 2:1 ROAS on those customers is a very different CAC. So, 2:1 ROAS for both is a $25 CAC for one and a $50 CAC for the other. And so, if you're only running lowest cost, and you have both of those people, you're going to overwhelmingly go to that $25 customer. Um, and so, the idea is that the value optimization is going to reach people who are likely to spend more money um when you do that.

But, I think I see your point. And I think I think I don't necessarily disagree with what you're saying, which is that at some point, it is going to If you sort of take over your account that way with that kind of stuff, you're going to have less reach. And I've seen a few brands where I feel like I've maybe seen this happen. But, but I It's very hard for me to attribute. You You said something in there that I think is really important, which is this notion that basically on the 2-week incrementality test, the value optimization looks great.

And whether or not that's because the lead's more qualified or it's it's somebody who's got some awareness of your product or not, I kind of forget it. Like the the thing that's interesting to me is the idea that perhaps though over a longer period of time measured in longer windows by reaching less total people, you're going to hurt your total performance because the impressions and the clicks and and and the video views and all the you know, all the engagement that you get from all of your other stuff, all that stuff is going to uh is going to have downstream value that can't be measured in a two-week window.

And that basically by reaching more of those people, you're going to expand your total reach and that's part of how you're going to grow. Now, it's going to take a longer time period to convert that customer. It's going to be a little more expensive up front, but in the long run of building a larger growing business, the impressions actually matter. You just have to get in front of people over and over for a long period of time.

So, that I think is the is the claim that you're making. So, maybe be a little less uh uh aggressive with your value optimization, which uh which would make sense to me. Um Yeah, and again, I'm not saying don't do it. We were more than 50% of our account on it, right? It was it was very heavy. So, it's just it's just find the balance and maybe have you know, have both strategies running if you find both of them to reach the most >> That's what we do recommend.

We we take the same ad and put them into both campaigns all the time. That's that's we just literally duplicate them. Yeah. Uh but let me ask you a question. Have you found any way to measure the long tail value of the impressions? So, like outside the two-week incrementality window cuz I mean I saw Taylor interacting with you about how their incrementality tests should show value optimization works really well. His comment I think in response to all of this episode would be it doesn't matter.

You should pay for warmer leads more often and you and then like all of these tools actually do hurt your incrementality, but but perhaps on a longer time window, that's not true. Uh and so, I'm curious if you have any way of thinking about like conceptualizing or mathing the value of the like the impression that's going to produce value for you in 6 months or whatever it is, you know? How do you think about I I I think so.

So, like one easy like North Beam MTA way to think about it is like if we have two campaigns that have the same ROAS, let's say we use a one-day click and platform and we can discuss whether we should or not. >> Yeah, yeah, sure. Same same ROAS, right? You're at one ROAS, but one of them is driving a better percent new and a better cost per thousand account reach. Like that's the one I would want my team to lean into a little bit more.

It's just there's just more evidence that it's driving a little bit more of a of a newness or a new factor. Like there's different ways to look at it. You could look at what they call ROAS lift and say, all right, like I can look at how, you know, that either customers not even LTV, but just like that traffic converts over time. Like we've done that and look at different channels, you know, over time. So, like I do think like that.

Uh 1 7 30 day, something like that. You >> know. Um that's another one. And then, you know, I haven't explicitly done this on uh but the but House has something called a post-treatment window, you know? I haven't explicitly done it on value, but it's just like, okay, for example, we know that Meta in a I'm just making up numbers, but let's say Meta in a two-week post-treatment window, so after test ends, increases, you know, the revenue increases 10% and Apple 11 increases 0%.

Well, like now my Meta ROAS can be 10% more aggressive. Yeah, right. >> That's kind of how we look at it. And then vice versa. So, like I'll give you an example just totally different like TV. We got a really good read on TV in a three-week test. And like you can make the claim that you're reaching new people and there's a better post-treatment effect from TV. And so, if we were happy with the three-week test, like and we have let's let's say just the same cost per, you know, incremental whatever CPA from a Meta where it increases 10% and then TV that we think increases 30%, like I shouldn't be looking at those things together in a vacuum.

I should it's much more nuanced than this, but I should figure out how I give different levels of value to those different strategies based on the goals of my business. How much of the value do I need to realize in two weeks versus I'm okay with that over a longer time. And I think where you can even say is like, hey, I'm actually willing to take less today, less efficiency today on TV cuz I know over time and that's a little bit more of like a financial consideration.

But at least what I instruct my team to do is if all things are equal, meaning if our two-week efficiency is equal, always bias the one that we think is going to get a better reach and better new customer growth. It's funny because so, I'm I'm of two minds about this whole idea. On the one hand, I think like at some point your your contribution margin does turn negative. And like so, even if there is long tail value that you can't see, it still might not be in excess of the cost, you know?

And and so, there's like a consideration So, what for us it's I I I almost always want to break even on acquisition. Well, >> just like Yeah, and I'm not I'm not really saying for you. I'm thinking sort of outside cuz I I'm I'm just like confident you've done the math in your business, you know? Like I don't I'm not really worried about like what should Jones Road do. It's like I'm just thinking about this strategy for sort of other brands and thinking like like what I see so often is still just large buckets of poor spend where a lot of brands could be running materially more profitably by shaving off what I think is basically a cost center in their business, which I always think is like the last 10 to 30% of their ad spend, maybe even 40% of their ad spend, uh reallocated and thought of differently would just would just stop being a drain on their cash basically cuz right now I think it is a lot of times.

Um that and that exists in all kinds of different businesses. >> at that stage, I would imagine you educate your clients on diminishing marginal return curves. >> We certainly try to. Yeah. And that's part of why I'm such a so that's why I like bid caps so much is cuz you just have a built-in mechanism. But now, this is a problem for two ROAS ads because it is an average and you're going to get a bunch of like weird diminishing return spend in there.

But the whole reason I like bid bid caps so much even over cost caps or something is because you could just set this number in a way that is much more reliable and reasonable and and sort of bid up to a threshold. So, but um you know, I have brands I have a I had one brand that a couple years ago sort of really went all in on this idea of like, let's really push our acquisition to the redline. They're super holiday-oriented brand.

We'll push it to the redline and take basically as thin of a margin as we can and we'll do that going into holiday because at holiday, that's where we'll sort of like really really really make all of our money. And the expectation was that there'd be this long tail value from all the impressions that they'd built up over the year. And what happened was there just wasn't. Like it just it just it didn't materially impact holiday at all.

Like there was no long tail holiday. And so, instead, they just ended up with like a much thinner margin than they expected and then certainly than I expected. And it was like a test and they ran it and they've sort of since then reallocated their whole strategy around the notion of well, let's actually take more CM up front, actually shrink our revenue a little bit in and and see if we can be like way like produce actually more profit in the process by just shaving the worst part of our spend.

And then critically, in they're not going to do that forever. Critically, in their attempt to grow again, they're they're kind of reassessing things and going like, what about the marketing calendar? What about our organic social strategy? What about our sales strategy? What about our product development? You know, all that kind of stuff. And my take is there's a number of people who will kind of take the advice from a a show like this or episode like this and they'll say like okay, I got to go pay for more reach as the way to get past the wall that I'm in.

And in fact, what they need to do is go and say no, go address the marketing calendar. Go address your product. Go address like, you know, the thing that you're stalled out or your creative strategy or something like that. But basically, it's not really a bidding problem for a lot of brands. That's that's that's what I tend to see even though I believe what you're saying is true at Jones Road. And so, it's like this weird like it's like this weird mix.

And and you're and you're making me think like I need to go get that app and like go check this. Like is this actually a problem in the businesses that I'm looking at, you know? I Well, first of all, is it even a problem? And then actually, what are the levers? Yeah, that's right. That's right. >> is another big one. And I think those levers are different from every brand. Like Ridge doesn't have the same reach reach issues that we do.

I think there's a few things. A, they're less of a repeat purchase business. So, like exclusions are fundamentally broken post-iOS. Like I think that's a clear known fact. Um for us, for some reason, they were much more so. We had at one point a period in time where 40% of our incremental revenue for Meta that was generated was repeat customers. So, it was still incremental, but it was it was much worse than we wanted it to be or much higher, right?

And so, I think for us, A, because we're a consumable business with a repeat customer base, maybe other issues, we've struggled with reach more. Ridge is purely or not purely, primarily acquisition focused and they've always done a great job of reach. They've always had to, right? Because because they have to acquire way more new customers. So, like they've gotten really good at doing YouTube sponsorships, like all this other diverse traffic that I think they have for some reason had better signal on it.

So, I just I just think it depends, but there's levers. There's some brands that are running 100% conversion optimized $300 year business, but they're just masters of creative strategy or they're, you know, playing a different game. So, it very much depends and it's going to be different, but I I am still not even sure today what the right levers are. Yeah, yeah, yeah. And like my current hypothe- cuz it's not just creative cuz we've made big account changes and seen really big lifts by not just creative.

I my current thing and it's like the least sexy thing or it's not like media buying is that it's you have to marry up five to six things to get optimal account performance. You need the right creative strategy, which everyone knows. You need the right media strategy. And so, it some of that is as small as attribution setting, VO versus CO. Some of it gets into a little bit more complicated stuff of what's your upper mid, you know, funnel plan.

Um are you on uh current incremental attribution like stuff like that? So, there's that. I think you should have a signal strategy as well, like signal engineering. How am I thinking about creating funnels to actually drive the signal that I want to meta? And maybe that's VO, maybe that's hey, I'm going to optimize for a quiz completion and that's going to keep high intent and move that up funnel. So, you have that. You need a measurement strategy that aligns to it.

If I'm saying I want to reach new people and I know there's a you know, there's a cost to doing that, why shouldn't expect everything to look great on a one-day click basis? But, maybe for the the majority of my business, right? I am actually not only am I willing to, it's actually the better for the incremental outcome of my business to accept a lower one-day click because I know that those people aren't going to be the people that are going to buy right away and they're going to they're going to you know, do view-based stuff or they're going to buy on Amazon, whatever it is.

I just think you have to And then there's a landing like a post-click strategy as well. I just think you have to marry all of those up together and I don't know that it's just one that we can say is like this is the lever. I think all of them are the levers and you have to figure out for your business what are the right levers to pull. Obviously, creative is a huge one, but I do think that it's not the only one as much as meta would like to tell you it is.

Probably the single place that we are currently building additional infrastructure and investing time, money, thought work into right now at AJF Growth is our lander and offer planning and builder. And that's because we believe that offers have some of the biggest impact on anything that happens in the growth of an e-commerce business, in the profitable growth of an e-commerce business. And we have a partner [music] in all of that with whom we work for almost every one of my clients has this software installed on their site and it's the one that we're going to keep working with all the time and that is IntelliGemz.

And we're going to be using IntelliGemz to run all of our website testing, all of our CRO quote-unquote, they don't even like being called that, I'll tell you why in a second, but all of our CRO testing, all of that because IntelliGemz allows you to test way beyond the basics. So, yes, there's going to be message testing, yes, there's going to be all of that kind of thing, you know, page structure testing, listicles versus traditional landers, all of that stuff.

IntelliGemz can handle all of that in its sleep, so to speak. Software doesn't sleep, but you know what I mean. And so, that's awesome, but the thing that I really love is the ability for IntelliGemz to test different outcomes of offer and message testing [music] at the level of profit, okay? So, what we are going to be able to do is take different offers and very clearly and very easily, because IntelliGemz ties into your COGS data, your shipping data, all those things, output the answer [music] to which offer worked better.

You know, was the big stacked bundle or was it the low-price trial offer? Was it the 20% off flat across everything or was it the stacked discount, 10, 20, 30 depending on how much you buy? Which of those things created the biggest income? What happens when you change your shipping threshold, your shipping price, all those things? IntelliGemz as a tool ties into all of your actual unit costs data via your Shopify store and outputs the results of your tests based on the actual profit that [music] each sale of the test drives and that is really really critical.

You can also, of course, see subscription rate by different offers and and even do some testing in checkout now as well. It's really cool. You don't need a developer to install it. It's intuitive and you should be using it, too. Offer testing matters, design testing matters, all that stuff matters for actually doing the things that move the needle of how customers interact with your site and with your products. Get started with it today.

Use the code FARIS20, F A R I S 20 at intelligems.io to get 20% off your first 3 months. Get started testing today. Start building a serious testing program on your store today. intelligems.io, link is in the show notes. That's right. A yeah, that makes sense to me. Um I also do wonder if if meta is actually the best meta is the best place for conversion optimized ads in the world. I think there's no question about that.

The the uh what I wonder is is it actually the best place for for sort of non-conversion optimized ads or if you actually just get better quality impressions in other places and if you actually want to go upper funnel a little like higher up the funnel a little bit more, whatever. If you ought to be thinking about other channels as being a more useful tools for that for a number of reasons. So, um I I I have many more thoughts and follow-ups on this.

This is deep dive stuff. Yes, I do think um I do think for most brands it is they're still probably in a stage though where creative is the next lever they ought to pull. I've been thinking a lot about sort of what the ideal creative setup is and until you're spending a whole bunch of money, like building out additional tranches of creative approaches is probably the most valuable thing. You know, at AJF Growth we specialize in performance creative, traditional direct response advertising, still video, scripted long-form explainers, that kind of stuff.

Like that's just our bread and butter, we're really good at it and and there's that. But, I don't think it's what the entire account should be. What I'm actually seeing for some of our clients right now is that some of their best-looking accounts that we have have this real mix of that with something you've been talking a lot about recently, which is which is sort of an approach to organic social and to and to really that muscle not just at the organic level, but having a sort of an organic social muscle that goes through the organization and content creation in general.

And so, so as much as I love like traditional performance creative and we'll keep making that for clients and keep selling that very gladly and we'll see success with it. There's another sort of bucket of creative that should be happening that may or may not live in the ad account primarily, but you've been talking about this a lot and so, I want to talk about this, too. And that is that organic social It's actually probably the biggest lever.

I think part of the reason I have to turn to some of these other levers is because we haven't developed this muscle nearly well enough. If you look at If you look at meta earnings reports and you look where the user growth is, it's reels. And so, you have to again, we we forget we're creating social ads and you have to understand and create content. Like I do think their ads can perform that don't that sometimes looks like ads.

I do think there's a place, but I also think you do need native ads and you have to understand the platform and the best businesses that I see are driving a lot more reels delivery than others and that's a huge cuz that's just where the growth and engagement and time is being spent and we have been historically a feed-based advertiser and we haven't caught up with doing, you know, reels, getting really good at reels yet.

So, let's talk about it. So, you So, this I think naturally dovetails with the conversation about expanding your reach. If If If creative is is the first lever to pull in expanding your reach, right? Somewhere in there, right? What What are you How are you Tell Tell me about what you saw as the as the lack at Jones and then and then what you're doing about it and and how you're trying to solve it. Yeah, so we were, you know, for heavy Facebook spend, heavy feed spend and the style of content was better supported to that.

And so, like you know, it's funny, you think about like an AppLovin or an X and like that's a new channel, but you can only spend a few grand a day on an X and you know, a little definitely more than that on AppLovin, but it's like you can scale your meta spend by so much more if you actually treat these platforms as different channels. Like if you just made reels its own channel, right? And thought about it differently, like probably the daily active users there is like so much higher than any of these other ones, you know?

But, I think it just gets lumped in together cuz it's all like broad placements. Um and so, I just think you have to whether even if you media buy them together, you got to think about it as a different channel cuz I again, that's where the reach is. We have tried mostly unsuccessfully, somewhat successfully to expand our reach on reels and that has been one of the biggest thing that has correlated with our reach improving and then our incrementality improving.

Um even though it doesn't always show up in attribution because I think reels is a little bit more of a view-based platform. And uh again, this is just marrying all of these things together. So, partnership ads has been very successful for us cuz it's native to reels, it's native to stories, you know? Um things that that look, you know, very organic and definitely like the Yapper style has has done well there. Being willing to not look as much at a one-day click and actually take a worse ROAS, but you know, know that it improves reach is is another one.

So, that's like our, you know, our measurement strategy. Um but, what I what the bit one of the is a long answer. One of the biggest things I noticed is like we tried every agency in the book and it just was not performing because it was just the content was not native to social, it was not the language of the internet and the language of reels, right? It was like, let me be a UGC agency who's going to script creators and find, you know, actors and I'm going to be I'm saying really harsh, but like there's like 12 rounds of edits, right?

It's like clearly an ad, it's like edit by committee and it's like I just want somebody What I realized is our paid social and organic social programs had the same issues. We're like we'd have ideas, it would take 2 weeks to do, it would be overly produced. Like brands are not always great at creating content. And like what I want is somebody to pick up a phone, get an idea and be like, oh, I'm going to go create that today.

And like that's what we've hired for and are hiring for and you get, you know, the signal. So, I just think there are so many reasons why uh that organic approach is I think a lot of brands are starting to see success with that where they used to not. The funny thing about that is that people have been talking about this idea for forever in some ways. Like the idea of like make stuff that's more organic to social, right?

Like but somehow in the reels conversation it seems like it picked back up. Like I'm going to but like the entire time I've been in e-commerce like, you know, I mean I don't But, that's what UGC was. That's why I find the Yapper thing so funny is it's like that's what UGC was. Like I'm old enough and I know you are, too, to and I've been in this industry long enough, not that long, but to remember like use like UGC was actually like, hey, I'm going to get a piece of content from my customer and they're not going to be editing it, they're just going to be sitting here talking and there's going to be this ugly piece.

Like I've seen some of the stuff that you guys have talked about, Bamboo Earth from your like 4 by 400 days of like just like stuff that you don't even think is going to perform, but it's just so real. But, for some reason UGC on X became I'm going to write the script fake. >> Fake. It became fake. >> Yeah, yeah, yeah, yeah. Yeah. But, I mean it's funny because So, to the Bamboo Earth thing, so you're referencing that we had this video ad at when I was a Bamboo Earth skincare brand a while back before 400 and it was just a customer doing her makeup her skincare routine.

And you know, it's like a 6-minute video, it's not shot very well and it's just her going through her whole routine. And it was just like millions of dollars of ad spend kind of thing. And so I have repeatedly tried to replicate that in different scenarios including with some friends who built like an agency that was all about collecting we started calling it CGC actual customer generated content. Which was what's so funny So funny we changed the name. >> know that cuz cuz CGC became this pervert like yeah anyway this this phrase became this something different thing.

So um and it and like we've tried all that and it has not really worked. Like it's like like >> Basically basically there was just this it was just you know little bits of customer content had worked here and there for but maybe that was just actually one smash hit ad that for some reason connected and it actually wasn't a replicable strategy a lot you know. They have really tried it a lot of times. Um and and it's so enticing.

But the funny thing is that that whole idea is exactly what you're saying which is like people just sort of talking. That is so traditional paid social and um but something about reels has made people reconsider this like and say like we want more reels native stuff and I don't exactly know what it is. I have two thoughts as to why. Okay go. Yeah go. So number one is consumer trends. So like there was this really good like consumer trends report that was going on the end of the year.

For whatever reason and I think I know multiple reasons like people just want that authenticity that realness right? It's like trust in legacy media institutions is at an all-time low right? They want that you know that not always polished but real thing that started on TikTok is just now a media thing. So I think that's partly why it's you know that's low-fi style unedited like you know it's no longer like the fast cuts edits is like some of these are no edits for 60 seconds and and people are yapping.

I think that's part of it and then with the follower feed on organic social essentially being dead you know five years ago organic social for brands was let me make some really pretty stuff let me curate my grid and feed and and and let me post it and it's going to go to my followers and they're going to love it. Now it's organic social is hey what's my hook how what's my top mid funnel strategy right? How am I you know reaching new people what's my watch time or engagement like the the delta between organic and paid social strategies is just so much less because of how the algorithms are working.

Um so I think those to me that's my opinion those are the two reasons why these strategies are converging. Yeah but again I I feel like people have sort of said that forever. There's something about the advent of reels itself that people are saying oh is reels reels is different. Reels is and I don't I don't know exactly what that is. I uh but it it doesn't it doesn't matter. >> is a discovery engine that goes to non-followers and it's it's it's merit-based and you're you know you're optimizing for engagement and >> Your feed and your stories have always have been that way for years right?

Like now it's accelerated that significantly. Yeah yeah yeah I guess that's true. Um okay uh I have one last question about this but I'm I know you have a hard stop and um and so in two minutes or less what have you guys done team-wise to solve this problem internally? Like how are you how are you actually approaching this? The biggest change that we made again we've done multiple different things. Um creative is still work in progress and definitely not satisfied with where we're currently at.

It's definitely like one of the biggest focuses and getting much more diverse about it with persona like persona stuff has been really good. Uh parent partnership ads persona-based partnership ads that go to landing pages that are speaking to that persona has been extremely effective. Um you know fixing exclusions with you know tools like Wasteland or whatever has has worked for us. Um doing you know some mid-funnel campaigns where we're you know optimizing 10 to 15% of our account for view content or quiz completion has been helpful.

Uh we're testing IA now which is incremental attribution but Meta used to have like this other thing called AEB that you kind of bid differently on different audiences has been helpful. Um there's value rules where you can bid down on engaged audiences. So just a bunch of different levers to pull. Uh adding in a view optimization campaign where now that allows us to get a little bit more reels delivery because our our you know we're reaching people who are you know it's just more total people right?

If you believe that views can be incremental. Um So there's a bunch that I think we've we've done in house. >> at the level of creators or content like just like like that kind of stuff aside from the media buying stuff? Are you like are you hiring people to make more organic social content or Yeah yeah so we have a program going on so that was honestly one of the large reasons we launched on TikTok shop was literally just for the creative flywheel.

Um so that's a big piece of it and we're just starting to get that live in our account but hearing from a lot of brands that that's working super well. Uh yes we're we are hiring multiple creators on staff and things like that. So we're we're I don't have success stories to talk about yet with that. Um but we're definitely working on it. >> Partnership ads is like 40% of our ad account so that as well and there's some signal there.

Um I it's just not where I would like it to be but there's definitely some progress being made. Yeah. All right we got 10 minutes left perfect timing. What is the what are the core challenges you feel about the combination of roles in like I guess what I'm asking is why is the overlap of fatherhood uh let's put marriage in there too cuz it's part of this sort of husbandhood and uh and CEO-hood why like why is this even a discussion point?

Like what what what are you why why is something that faces you in such a way that it would be worth bringing up in a conversation you know? What are the challenges what are the things you notice about it? What's top of mind about it? >> so it's it's so hard. I'm not I'm like I'm going to try not to cry cuz I'm totally going through it right now. But uh we'll see if I can hold it together. It's all right if you cry. >> like I'm not looking for any sympathy from anybody but I just like also don't want to be the person who's like hey everything is great everything is perfect.

Like business is not always fun like I probably should have canceled this podcast today cuz I had some going on with like a people thing that like yeah that should probably get my attention but you know what I I I gave you my word and like I didn't want to cancel on again. You you're always welcome to in the future it's okay. >> My my my wife is gone for the weekend so I got two kids all weekend but it's like it's also blood like I'm just sound of super cliche but it's like it's a lot but it's also a lot of good things.

Like you know it's it's a lot of responsibility and and it it sucks at times but there's also a lot of great things that come with it and you know kids are only young once and so yes it's it's it's extremely hard to balance it but like you know I I do my best to be present when I get home at 5:30 you know with kids for a few hours once they're sleeping until 11:00 12:00 you know. So it's it's hard to balance it's it's also a season.

I don't think it's always going to be like this but >> Yeah. um definitely has its its challenges and its low moments and its high moments. How old are your kids? Uh about one and three. Gosh yeah. Um my kids are four and six and it's definitely easier than it was at one and three. Mhm. Uh in some ways in other ways it's much harder. Um but uh but in terms of the the kind of the kind of attention you that is required is is different I think.

Um When what it tell me about your schedule in relation to that. So you said you get home at 5:30. Mhm. Uh what when do you get to work? Go through the whole day. When do you get up? When do you get to work? >> I've been it's always shifting but cuz we haven't been sleeping well with kids not sleeping well and whatever. I usually wake up probably 6:30. Um if kids aren't up I'll work for a bit. Um a lot of you know cloud cover right now but I'm working for a bit just trying to get you know Slack stuff like that.

Once kids are up 7:00 7:30 I'm with them. Fortunately we have some help in the morning which is like great like couldn't do it without. >> Yeah. Um but you know get them off to school and then like nanny comes by you know 8:00 8:30. Uh I'll sneak in a quick workout usually it's like 20 30 minutes. Shower get to work you know 9:00 to 5:00 5:30 it's it's pretty packed. Um try to get home 5:30 at the latest. You know try to be as present as possible.

Um We just got like a chef service so I highly recommend that has made a world of difference and just try like obviously I'm definitely on my phone checking Slacks trying to get through some of them but also making sure like there's time where it's like you know putting it away like my daughter definitely notices now. Yeah. >> you know what it's not there's not that many hours in a day but it's like there's definitely attention where sometimes might you know my daughter's going through a tough time and she like needs to us to stay but I'm like I just have so much work to do but it's like also like you know just chill you got to got to be with her.

I'll I'll do it after. So it's it's a lot. >> why do you have so much work to do? Like I got uh like what is that do you think here's my question is is that self-imposed or is that uh or is that an external pressure in some way? Do you know what I mean? When you're not that I'm a founder but it's a family company. When you're CEO you know you don't get to just say it's 5:00 at night. Like ideally if I had everything set up properly in the right systems and all the right team and people you you have all the time in the day and you're supposed to be doing things. >> the person that gets to say that?

What aren't you the only person who gets to say that? What what do you >> I'm not I'm not I'm not I mean if you say it's 5:00 go away then everybody has to listen. You're the only person you know. Whereas like if you have a boss you you can't it's like it's harder to do that. Uh Cuz I'm responsible for the outcome and I'm going to do everything I can and and I think when when things are really good and you're you know crushing it's like yeah.

All right let me let let me let me put it away let me enjoy it but you know when things are bad like Yeah. I'm going to do everything I can. I might I might not be the smartest worker but I'm definitely the hardest worker and like I'm going to do everything I can to to wait and if I can work that much harder and that much faster to make these changes happen in three months instead of six and I know the business is going to be better off like I'm going to do that you know.

Yeah. So it's not a sustainable thing but it's right I think in certain phases it's what happens. Do you think that's true for you that it actually that it is that it has been Like I I one of these sometimes I'll say to my wife like I think in like a month or so this is going to be, you know, taken care of and it'll be a little bit calmer. And then she's just like she's just like I'll believe it when I see it. You know, like like because it's like there's always something new that comes up, you know. >> Sure.

And uh And so I So do you think it is just a phase or do you think it's like the way I'm really not trying to sound accusatory here. I'm I'm I'm trying to think through this issue myself, you know, like uh If I was If I thought we would hold Jones Road forever or even for a decade, I would be like, "Okay, this is not sustainable for 10 years. I see. >> do it differently. Because I don't know the our plan and that's not it.

It's like, "Okay, I can do this for a few years and you know, do this intensity for a few years and I think I will then be able to, you know, not have to do it after that. But there's like a few years of grind if you want to call it that, you know. I think that's a that's a that's a good observation. I've noticed with with clients of mine stuff too where like everything is just a lot smoother and calmer and then they and then they create a an exit plan or something like that.

And suddenly there's a whole This is like the hidden cost of of building for an exit that is that it's going to create a level of stress that's really really different. Uh and I don't I don't know if it's avoidable. Maybe it's help I just think people should know that, you know. I actually saw some people debating the other day whether or not they'd rather have a business that was 15 million in revenue with 15% bottom line margin or 75 million in revenue with 10% bottom line margin.

And obviously the second business has way more profit than the first business, you know. So it's like sort of seems so obvious that should be the answer. Um but there were like people genuinely debating. Like I don't know which one I'd rather have, you know, probably depends on how much it It's like, "Wow, really?" Like But one of those has like three plus X the profit. >> of these like like smaller brands or brands starting new today and are doing like 50 million with two people.

I'm like, "Oh, all I deal with are people issues all day." >> I would love that. Yeah, yeah, yeah. I think it is really hard. I think The thing I do hear from You know the You know the uh You know the senator uh the former senator Ben Sasse? You familiar with him? No, I don't know. He's a Republican senator from Nebraska. Um he was in the Senate for eight or 10 years or something like that. Uh Well, he He has a really aggressive cancer diagnosis.

He's like in his 50s. Um and so he's he's out of that. And so he's probably going to die in a few months. He's He talks about it a lot publicly. Um and he he has talked about the idea that like, "Man, getting close to that uh he has realized He says the 16 months campaigning uh for the Senate was awesome. He took his whole family with him. They went to every county in Nebraska. They, you know, they had it was a thing to work on together.

They all traveled around on a bus. They said it was like the most fun 16 months everybody said. The Senate itself was terrible and like he had to commute from Nebraska like basically, you know, like uh every week and He said the journey's better than the destination. Well, yeah, his point was just that the actual work itself he looks back on. He says he's apologized to his family for it. He thinks like it wasn't very effective in his case.

Now, this is one difference between you and him is that like uh is that you could probably actually affect the outcome a lot more. But he was like, "I don't know. I don't know if I really got anything done as a senator. Like it's just really hard." And then he looked at that and said like, "That was like driven by my desire and my ego and stuff in a way that I think wasn't good." And when you hear people who have the perspective of their looming death be able to reflect on that, I just think there's something to listen to there.

They probably have It's probably not the only thing to listen to. There's other things too, but um Anyway, it made me think about it. It made me think like, "Man, you're right." Like you said, right? You only get this time once. So I don't have I don't have the answer here, but it's it's just an interesting thing like what Which of these things are actually self-imposed on us and which of these things are not, you know, so.

Yeah. Yeah, no, I I mean I've listened to a lot of your pod and I know how you feel and you've like I don't know about now with with uh higher impact traffic in the agency, but I know you've making active choices to like, "Hey, I'm I'm going to work this way." >> Yeah, well, we're pushing definitely. Definitely pushing harder than ever. >> respect that. Like there's never there's there's for me there's always never a right or wrong and like there are some people that are going to do that and there's some people that are going to grind themselves to death and there's probably a lot of uh personal stuff that's behind it, you know, that whether they're honest with or or or not, you know.

Yeah. Yeah, well, it's definitely different now because of the because of the uh you know, we've definitely changed different goals and have opted into a little more pain with it. All right, man. Thank you so much for taking the time. We'll talk again. I'm I'm coming on the Marketing Operators in a couple weeks, so I'll we'll we'll get to talk again soon. Appreciate it so much. Can't wait. Thanks for having me. All right.

Fantastic episode with Cody. As always, you can just see what it looks like to really get into the details of the work of meta media buying and of media buying in general and of understanding the finances of your business and thinking through things really carefully. These are hard puzzles. One of the things people really misunderstand about what happens with growth is that as you add growth, as you add reach, as you add size, the problems get really challenging.

And so at points, you know, I'm interacting with Cody and maybe pushing back a little bit, but I I do that with a lot of humility with Cody because he's he's solving very difficult problems in that business and they're not obvious and they're not easy answers. So big thanks to Cody for taking the time to talk about all those things and to to get into it with us. You should of course go follow Cody in all the normal places on X.

Go listen to the Marketing Operators podcast. As I as I said, I'm going to be on there in a couple weeks, too, so that should be really fun. Well, the links for all those are in the show notes. So if you if you're wondering where to follow up with Cody, if you don't know, then go to the show notes, go follow those places and and you'll get there. Also, yes, subscribe wherever you're watching or listening to my show so that you don't miss any future episodes.

I've got a bunch more really good stuff coming very very soon, so you're not going to miss those. And email me podcast@ajfgrowth.com or go to ajfgrowth.com if you want to work with us. >> [music] >> If you need help going down the journey of that sort of 5 to 25 million all the way up to 25 to 50 million part of the e-commerce journey, we really do know what we're doing in that phase of business. We'd love to help you sort out all of these kind of things in your business.

Should you be valuing reach more? Should you actually be cutting spend? Should How should you be approaching these problems? It's different for different businesses, but it's based on the same principles, understanding the real financial complexity of businesses at this stage. Uh so fill out the intake form, tell me about your business. I'd love to hear about it, see if I can be any help to you. Big thanks to my friends at Intelligems and my friends [music] at More Staffing for sponsoring this episode and uh and of course go follow follow up with them in the show notes.

I will see you next time.