Latest / Scalability School / DTC Offer Strategy: Raising Your Price Without Losing Conversions | Brian Ng

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DTC Offer Strategy: Raising Your Price Without Losing Conversions | Brian Ng · Scalability School

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why have your price at $35.99 when you can have it at $39.99?
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Why have your price at $37, $38.99 when you can have your price at $39.99, right?
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It's something that also, that's how you can squeeze a couple of dollars of profit
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per order whatsoever.
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And something like, for example, a lot of people run the buy one, buy two, get one,
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buy three, get two.
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And then you run the sub offer on top of that, right?
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And so after 15%, you get your prices at, let's say you start at 29.
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You get your prices to like, I don't know, $22.99 or something like that.
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Why not make that like after the discount, after the sub discount, $24.99?
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It's the same thing.
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You're going to make more money off that.
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You're going to get the same conversion rate, a higher rank per user one.
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And now let's take a listen to the Scalability School podcast.
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Welcome to another episode of Scalability School
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with a rare appearance of Zach, Brad, and myself back on the podcast together.
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Although I will be leaving early in this
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podcast because I'm in Europe and it's late.
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Brian's in Singapore.
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It's 4 a.m.
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Brian, cheers to you for getting up our guests.
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And Zach and Brad are in a time for them that's totally normal and makes sense.
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But Brian, I'm just going to say Brian.
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So Brian is a great guy, member of our
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community, has been a member for three years,
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totally an incredible growth expert, somebody who is an agency owner,
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who has recently gotten into being a brand owner,
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somebody who I respect and who I turn to a lot.
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He has always been somebody that doesn't settle for just the baseline.
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He always is pushing.
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And I know somebody who's really great when I introduced Brian to Zach last year
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at a Foxville Founders event.
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And then Zach texted me after and goes,
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you were right, Brian's insane.
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And I was like, correct.
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He's awesome.
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And because every time I talk to Brian, I'm like,
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what do you got going on?
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And then you send me these like 35 minute looms of all the stuff.
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I'm like, it's like watching that scene from Always Sunny in Philadelphia
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where the lines of a string are going between pieces of paper.
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That's you.
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That's you, man.
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So I'm really glad to have you on the podcast
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and I'm glad to get some sauce for our listeners for you here.
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So on to the, since we had the longest intro of all time.
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Sorry about that.
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Anyway, so Brian, super glad to have you here, man.
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Also background.
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One of the reasons I think you're a killer is because actually
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you were a killer in the Singapore military.
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Is this correct?
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Oh, that's not true.
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I was like the death of us.
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I wasn't actually holding the rifles.
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Brian, before we hit record,
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you were kind of telling us about the agency journey a little bit.
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And you said kind of over the last three years,
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you've onboarded a handful of clients.
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And it sounds like you've intentionally been thoughtful about how many you onboard.
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But the thing that was really interesting,
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and I think that what will set the stage for
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kind of what we're going to talk about today
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is just give us, give us like a little bit.
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You're running through examples of like, client was here, now they're here.
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They were here, now they're here.
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So just like brag for a second and kind of
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rifle off a couple of the results that you've seen.
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And I think that'll help us like set the stage for conversation overall.
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Yeah, maybe I can get started a little bit about the company itself.
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So DigitalWrite, like Andrew,
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as mentioned, we do like Rants and as well the agency side of things.
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We actually started off with Rants, my business partner.
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This company is actually like 10 years old.
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But my business partner was in like e-commerce
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dropshipping for like the first seven years or so.
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And an agency came over because we've been
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working with like an email marketing agency,
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Hustler Marketing.
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And they came over and said,
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hey, you guys are doing pretty well on paid ads.
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So like, can you help us do this with some of our clients as well?
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And he was like, sure.
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And we handpicked some of like the clients
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that we think could work really well for us.
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And that's when I joined in actually as a junior media buyer,
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but like three years of experience past that.
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And so we've only taken on eight clients over the past three years or so.
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We have grown them from like around 500k to 10 mil,
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500k to 2 mil, 500k to 1 mil, whatever the numbers are.
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And we really act as growth partners to the
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kind of the brands that we work with, right?
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So it's like a more of like a head of growth,
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not a CMO, but like the head of growth,
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the people that do all the work in that sense.
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And so and we don't bring on a lot of clients
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because we really want the people to get results, right?
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And there's always like so many factors.
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It's never just media buying.
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So it's me buying creatives, offers, and the landing page that you send to, right?
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Acquisition side, that's what we focus on predominantly.
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And so, yeah, that's kind of where,
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how we started and some of like the kind of results that we've seen.
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Cool.
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Yeah.
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And you mentioned a bunch of different growth levels.
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I know we're going to dig into at least a handful of those,
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particularly interested in offers personally.
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I feel like not enough people spend time talking about offers
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and actually how to craft it.
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So we'll come back to that.
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But so we have growth levers as options,
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but there's like some foundational work that you can do ahead of time
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to help set brands up for success.
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And you mentioned forecasting is one of those things
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that you have a unique perspective on
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and something that you help clients with.
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So can you just kind of walk us through like,
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what is the maybe the 10,000 foot overview of like how you do forecasting?
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And I'm sure we can dig into a bunch of different questions from there.
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Well, I mean, I don't think it's, it's a, for, for a forecasting piece,
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a lot of times for us, it, when, when you,
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when you do things a certain way,
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when you like creative test a certain way
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and you have a certain amount of creative volume
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for a period of time,
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you were able to then kind of see the seasonality of it.
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So like the forecasting that we do gets better kind of year on year,
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just because you, you know, you, you know,
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let's say in February you have a completely shit month,
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you know, in November to January, it's like a really good period.
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And then, you know, kind of what the trends are
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between like maybe certain July and August
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are similar revenue numbers, right?
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So you kind of know the, the trend,
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trend of revenue that, that, that the brand is on
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and you can kind of forecast just based off year on year, right?
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So we just look at previous year and this year,
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how, what do I forecast in terms of year and year?
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It's like the 80%, a hundred percent year on year grow, right?
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So like double, double grow.
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And then from there, a lot of times,
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that's where you start thinking of like,
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okay, I'm going to be growing like 120% here whatsoever.
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I really want to push hard here.
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Let me just, let me onboard creative agencies during this period.
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Because that's like the biggest element.
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When your offers is kind of doubtful,
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you have a decent offer and you have a good offer page
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and all these things.
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It's like, okay, I'm going to bring on new creative partners here.
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And that's when you need to come in and it's like,
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going at attention, it's like,
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you need to find a good, good, like good creative partners in.
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You need to, you need to make sure you know how to vet them,
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et cetera, and coming in like that.
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And so even with that, when you're forecasting,
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you are able to know like, okay, during this period,
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we actually really sucked ass because we,
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like we didn't do these certain things, right?
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We didn't plan for, I don't know, Mother's Day properly
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or we didn't do any.
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And then that's when you, you add that in,
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you know that you have more creative coming in.
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You know that you can hit your, your 120% year on year grow
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or something like that.
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Right.
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But every single month we plan consistently,
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like a person, like a percentage of like year on year growth.
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And we usually hit that number.
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And usually, and how we control this is that we can go like,
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we actually can go past that, that kind of year on year growth.
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But because we control it with bitcaps,
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we just like, we, we make sure we hit that pace
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that we need for, for that number.
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And we could go over, but you know,
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that guarantees us kind of like hitting the forecast and in that sense.
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So that's how we do forecasting right now.
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Usually when the brands first come in,
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they don't have that stability.
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So it's more so based off feels.
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A lot of the things that we do is based off feels,
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but, but also it's like, I'm, I'm always pushing,
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like you should never scale when you're,
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your new customer Royals and your, your numbers are not,
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like are not there.
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Right.
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Brand owners have like,
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or a lot of clients sometimes come to me.
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It's like, we need to hit this number.
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We need to hit that.
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And it was like, yeah,
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but it's better to hit a lower number with,
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with a, with a better new customer Royals,
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unless you need to clear inventory for cash,
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cash flow that then pays for your,
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for your loan that you took or whatever it is.
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Then, you know, that is a case,
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but then you need to be like backed up by something else as well.
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There was a case like that too,
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but a lot of times you don't need to push,
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to hit your forecast numbers.
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You should only push when you have something
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working in the creative side with a decent offer.
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So, yeah.
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More so, I, I, I was going to say that, you know,
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the, the, the most successful partnerships that we've had with creative agencies
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have been getting them when they initially first start off.
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And it's really difficult to find that.
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Um, and for example, one of our home runs was Harry,
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when he first started his creative agency and,
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and getting that in and he got like a lot of wins off that,
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a lot of total screenshots of it, of that as well.
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Um, a bunch of clients from that as well.
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So, uh, that's been like a really, really, um,
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great, great partnership.
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We're really happy with that.
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Um, and then we have some other ones.
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So we're still exploring when you have like three creative agencies on the,
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in the pipeline right now, but, um, or like working with us right now,
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but it's all long-term relationships.
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And, and, and that's kind of what, what, what we do, do with, with that brand.
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Um, less so like with creative strats, et cetera.
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Yeah.
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I'm curious.
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So do you, you don't have any in-house creative team for that brand?
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It's all agencies that are feeding creative.
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We have like two marketing coordinators that manage the, the, the brand side,
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the agency side of things, whereas like they're managing the,
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the content that's coming in and, and reviewing and giving feedback, et cetera.
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So I think that's, I mean, that's a really interesting call out though.
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So like this brand's doing 10 million a month and you have three creative agencies
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and no in-house creative strats.
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Like I think everyone always tries to go, Hey, we got to build this house,
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you know, in-house, it's always going to be better.
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I think it's good to just like say like,
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it's possible to build this all with like external agencies.
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Um, we at Marsman have rotated through a lot.
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Like we've probably hired and fired like 10 to 15 creative agencies at this point.
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Um, we currently are on with like three.
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Um, but we've, I think the one question that I have for you is like,
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how do you dictate a someone, are you or
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someone dictating what each agency is focused on?
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Cause I think that's the other part of it too, is like getting,
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at least diverse creative, getting different types of assets, whatever.
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Like how do you think about that?
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Um, for a brand that has like three creative agencies?
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So initially I'll say when we bring on a creative agency at the start,
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we usually just say like, Hey, just do what you think would work.
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And that creative agency probably has access to other ad accounts.
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They see what's working in the market.
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They're going to try different structures
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and, and, and kind of ideas that are working for
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those accounts, um, bringing them to yours, right?
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That, that gives the, the biggest success in that sense.
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Um, once you have that and, you know, one agency
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focuses on mashups, the other focuses on Yappers,
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then I, this is what happened.
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We brought on the third creative agency.
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They could do everything.
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I was like, I want you to focus on just these
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like AI pick sides or just AI creatives in general.
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So can you please just focus, focus on that?
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And, and, you know, of course they, you need
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to see that they might have the talent for it.
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You need to see the other creatives and what they
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have given to you, et cetera, as a portfolio whatsoever.
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Um, so that's kind of how we have split up.
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Uh, say when coming into a brand and bringing
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on a creative agency, I'm just usually, I usually
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know what they are good at.
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And also I'm telling them like, do, do what you think would work.
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Of course there's guardrails, right?
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Like we will look, we'll, we'll see, like,
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um, we'll, we'll kind of know what would work
12:02
for the account at best.
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If they give like some out of the box idea
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that's like really different, then we'll probably
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be like, no, like we're not going to do that.
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Can you like maybe go into this direction instead?
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But it's like, I guess it's more of, more of like managing.
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There's also like just managing people in general.
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You need gifting guardrails and, but let them kind of do their own thing.
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And giving them like a, so we, Zach, you call it pillars.
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Like pillars is like the core message that's being communicated in the ad.
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So it's like, um, hollow, the example we've
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used 8,000 times on this is like hunters versus
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compression or whatever.
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Are you telling the agency, are you at least giving them like the parameters?
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So it sounds like in some cases you kind
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of know, Hey, make yappers or make mashups.
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Are you also helping guide them with the
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direction for like what they should be talking about?
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Are you giving them the freedom to say, Hey, we
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see that this pillar angle message or whatever
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is working and we're going to create within that.
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The idea is at the start, we give them the
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direction, like more so where it's needed.
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Give them the creators that they need.
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There's what best in our account.
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Give them kind of the winning videos that we
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have and the messaging that we have and what
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we say in the ad and all this that makes it work.
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And after we guide them and give them in.
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But then like over time, after that three
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months, after that period of time, like I don't
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want to be managing the creative agency.
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I don't want to be guiding them into the right direction.
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They need to know what's working and they
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need to iterate on that and then get new stuff
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that's working without my time.
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Right.
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Because then it becomes very like I'm doing a job basically.
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So it's like they need to be able to do it themselves.
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Maybe guardrails at the start.
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And even if they're not like they don't follow it as well.
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Right.
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I mean, that's usually a sign that it's not
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going to work out for a creative chat or a
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creative agency.
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But if they don't, you know, we still give
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that three months and we test them fully because
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we onboarded them in the first place, which
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is then we know we trust that they're going
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to produce good creative and their kind of portfolio and all that.
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But, you know, sometimes there's kind of deceiving in that sense.
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But after three months, then you can fully judge.
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And it's not really for a bigger brand.
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It's not really a cost.
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It is a cost, but like the cost of not doing it is more expensive.
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So, yeah.
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Yeah.
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And you mentioned this has been the topic of the Twitter discussion.
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This is not going to come out for a couple of weeks at least.
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But literally in the last like 48 hours,
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it's been is creative volume important, which we
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can if you want to share an opinion on that, you're more than welcome to do that.
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But for the brand that's doing 10 million a
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month, like what's what is what kind of creative
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volume are they pumping out?
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I think it's like launch like maybe 60 to 75 concepts a month.
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It's not that and not that how many how
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many variants like of that is it like concept
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is okay.
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You should have a variance or whatsoever.
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So a couple hundred couple hundred and like
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when you say concepts like pretty distinctly
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different concepts probably across messaging as well as formats.
14:52
Yeah, exactly.
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So so basically like, you know, I mean,
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Harry has done I think probably has talked a lot
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about it on Twitter and probably on podcast.
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But he is one of our main creative partners right now.
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And he really like just changes the front end
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story of it and maybe changes the mechanism,
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like the unique mechanism a little bit like and and and so.
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But yeah, it's it's pretty diverse in that sense, like really different stories.
15:19
Got it.
15:20
Got it.
15:20
I can give a comment on.
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Yeah.
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On the volume and create the volume.
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Yeah, please.
15:26
Volume.
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I think it's it is such a like common
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problem, I would say, like volume as of itself is not
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really that helpful.
15:37
I've seen like newer like we just onboarded a new brand maybe two months ago.
15:43
The founder was doing really well last
15:44
year, August, and he was making his own content,
15:47
et cetera, blah, blah, blah.
15:48
And then after that, he started going into
15:50
this like if you guys know Tribe, Tribe is like
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TikTok shop for Meta, he went to that tribe
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where a bunch of creators coming in producing
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like hundreds of assets every single week.
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And I'm like, dude, you produce more than this brand.
16:04
But but his results have gotten worse and worse.
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And so I see in this way, it's, you know, you
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need to have like thought out like concepts,
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right?
16:15
And you need somebody to do it.
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So you need like if you have a creative
16:19
shred, they need to be thinking out their concepts
16:22
and then producing it with with intention.
16:24
And and then you can do like maybe 10 to 15 iterations.
16:28
You do five is completely net you.
16:30
Right.
16:31
And the same goes for, let's say, Tribe creators.
16:35
I would say or at least the creators that
16:37
they're coming in, they need to have that have
16:40
a like thought behind it.
16:41
You know, if not, I test them a different way.
16:43
I'm not testing them in a ABO creative
16:44
testing where I really spend budget on putting them
16:46
in a CBO and I'm throwing it in.
16:48
Because TikTok shop for Meta, like the tribe
16:51
thing, the thing is, like, I've only seen that
16:53
work with and this is my inexperience.
16:56
I've only got on the platform for like a few months, like three months or so.
17:00
And, you know, I don't have that much
17:01
experience in this, but I'm starting to get way more
17:04
because we have brands that are pushing this.
17:07
Um, but it's like the those brands are like TikTok shop.
17:11
They have creators that are producing stuff that's winning.
17:14
Then they pull that over to tribe and then
17:16
they start posting that or they then pull them
17:18
over into their own.
17:19
Um, they have their own system of of doing
17:22
things and and and and and that works for
17:25
them.
17:25
Right.
17:26
But those are like top creators and they're putting spend behind them.
17:28
Right.
17:28
We sometimes brands just use tribe specifically
17:31
to use for like the payment processing of creators,
17:34
paying the retainers, paying the percentage
17:36
of ad spend or revenue that that you're doing.
17:39
And that is worth the fee that it comes with, the 1.5% fee that it comes with.
17:43
Right.
17:44
So, yeah.
17:45
But going back to that creative piece is more
17:47
so like you need you need people of intention
17:49
to produce that.
17:50
If not, you need to find a different testing structure for them.
17:52
So if like creative agencies, they need to be producing that with intention.
17:56
And and that's the most important thing.
17:59
And the way that you scale volume is to have
18:01
more creative agencies and more creative strategies
18:03
and that have the intention and push that through.
18:06
Yeah, that makes sense.
18:07
Um, cool.
18:08
I want to jump into offers because I think
18:10
you it sounds like you have some strong opinions
18:12
about offers.
18:13
And so I'd be very curious.
18:15
Maybe where we start is, um, it sounds like
18:18
maybe even recently you've pulled up and you've
18:20
started to look in some ad accounts.
18:21
And like one of the first things you're
18:22
looking at and trying to diagnose is just like offers
18:24
in general.
18:25
Um, what does it what does a bad offer look like?
18:27
Is maybe a good start.
18:28
All right, friends, quick break.
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19:07
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19:10
data, launches them directly in ad platforms
19:13
and automatically monitors them throughout.
19:15
If something threatens validity, you're alerted before it ruins the result.
19:19
With North beam, you can launch tests in
19:21
platform with a single click, saving you tons of time
19:25
and reducing any chance for errors.
19:27
And when the test concludes, your results flow
19:30
straight into your MTA, meaning you can easily
19:33
see results alongside the rest of your data.
19:35
Incrementality was broken.
19:37
North beam fixed it.
19:39
No discount.
19:41
It's like 20% discount here.
19:44
It's really not really incentivizing any
19:46
action on like the middle or bigger bundle.
19:50
It's really difficult.
19:51
I think the visual of it is very important.
19:53
When you land on the site or the PDP or offer page, now it's the same thing.
19:58
You need to understand what's going on.
20:00
A lot of brands, they have it designed so badly.
20:03
Like in a way where it's like things are so messy, right?
20:08
The paragraphs that they have is like four paragraphs under the image carousel.
20:12
Like that whole like, and it looks super bad.
20:16
The four paragraphs in.
20:17
And then you have like another offer, which
20:19
is like four blocks long, you know, or like
20:21
five blocks long of like the different tiered discounts, for example.
20:24
And that just does like extremely horribly.
20:27
Why?
20:27
Because when customers land, they don't know what's going on.
20:30
They don't know what you stand for.
20:31
It takes too much time to read what you're saying.
20:35
It takes too much time to understand the offer.
20:37
So one of the things is like simplify the offer.
20:39
Try and put that higher kind of discount threshold as well.
20:42
Like raise your MSRP, bigger discount, you know?
20:46
So like that.
20:47
And they're like standard offers that you
20:49
can run nowadays with like supplements is like
20:53
buy one, buy two, get one, buy three, get two.
20:55
For any type of multi-skew or single product
20:59
multi-skew, like different color brand, you
21:02
can run like more of the javvy style offer pages.
21:05
Those are like our go-tos right now.
21:07
Yeah.
21:07
So bad offers.
21:09
It's confusing.
21:10
There's like way too many things like the
21:11
customer has to do math to try to understand
21:13
the economics.
21:14
Like that's a good example of that.
21:15
And then like the low percentage.
21:18
Yeah.
21:18
It's too confusing.
21:19
It doesn't look like a good deal.
21:20
It just needs to feel like a good deal.
21:22
They land on it.
21:23
Your ad needs to do all that persuasion makes them like really want to perk.
21:26
And then they land and see what you have,
21:28
maybe some reinforcement, but then you see
21:30
your offer is like, okay, this makes sense.
21:31
You know, do I want to fork?
21:32
Then the question in your head is like, do I
21:34
want to fork out this dollar amount for what
21:36
I just, you know, heard through an ad?
21:38
Yeah.
21:39
And so you mentioned a couple of things in there that was interesting.
21:41
So like the idea of like stacking and you
21:43
can kind of do that with buy more, save more
21:44
while also like playing with the MSRP value.
21:48
And I think particularly in the supplement
21:50
space, like there's a couple of outs that people
21:51
are going right now.
21:52
It's buy more, save more or subscription
21:55
only or some kind of like blended version of the
21:58
two.
21:58
I think like that's, that's pretty common.
22:00
But when people are doing the BOGO, I guess
22:03
this is actually true of the subscription offer
22:05
as well.
22:06
They're kind of like, it's like, okay, what is all in that first, that first order?
22:10
It's like, okay, we're going to throw in, you get, you get, you're going to get the
22:14
base products.
22:15
You're probably going to get a couple of free gifts.
22:17
Then you're going to throw in free shipping
22:19
or you're going to throw in shipping, which has
22:20
a value assigned with it.
22:21
So it's important to actually calculate that entire MSRP.
22:24
And then you do your markdown on top of that.
22:26
Is that kind of in the right direction?
22:28
Yeah.
22:29
I mean, I can talk about the offers that work right now.
22:32
Because technically there's only like three
22:33
different offers that brands that are really
22:35
scaling hard are doing.
22:38
Right.
22:38
It's that buy more, save more, which is you,
22:41
you, you buy one or you buy two, get one and
22:44
you buy three, get one or get two.
22:46
The other one is more of like what Marsman
22:49
does, which is like you do the, the, the, like
22:52
a subscription only at the front end.
22:54
We're actually going back to the buy more, save more.
22:56
That is like the one-time version that you can run.
22:59
And then you can run that 15, 20% discount as well on top of that for subscription.
23:03
And usually you see like a 60% tick rate on that.
23:05
Right.
23:06
Best app to use that for is Keqing Bundles.
23:08
It's the easiest to do it.
23:09
That's why the dropshipping demons do it.
23:11
Use, but the, and then you have the, the, the, the one that Marsman runs more.
23:16
So it's, it's like that, like a bigger discount up front, $39.
23:21
I think you get a higher tick rate from that for sure.
23:23
And then the subsequent orders are like $59, $59.
23:27
And then the last one, which is more of
23:28
like what Better Body Co-runs and like Rejuvene
23:32
that like those two companies, they're like,
23:35
last I saw it was like a buy one and then you
23:37
buy two and then you buy three.
23:39
And then it's like $10 off, something off,
23:42
and then like $30 off, something like that.
23:43
But also not sure how well that is doing
23:46
for them, but it doesn't seem to have, they
23:49
haven't seemed to have grown that much from, from the past couple of years.
23:52
But probably has, I don't know, it's looking at traffic wise.
23:55
How are you testing this?
23:56
Like, how are you testing in the ad account?
23:58
Is it like in the ad account, you're doing separate ad sets and doing ABO?
24:01
Are you doing IntelliGems on the backend?
24:03
Like, I think there's, there's so many
24:04
ways to be able to try to test and I feel like
24:06
offers is like a really complicated thing to test.
24:08
It is, well, there's two ways, right?
24:12
You either throw it in, like you, you add like
24:17
a UTM parameter that triggers this experiment,
24:21
like in a convert or IntelliGems, or you
24:25
can shoot it to like your best ads to the new
24:30
kind of offer page or landing page itself, right?
24:32
I still fall into the lines of like convert experiments.
24:36
I'm a bit old fashioned that way.
24:38
My business partner does all of the tests
24:40
now through, through the, through new ads,
24:44
new ad, best ads to that landing page.
24:47
What we found is that different ads perform
24:50
to that landing, if it's a different landing
24:52
page, let's say.
24:53
But offers wise, usually same ads.
24:54
I think, I'll presume the same ads would perform, but that's two ways.
24:58
That's the two ways.
24:59
I honestly just like, like do a convert
25:02
experiment because it's like just way easier.
25:04
Like I just throw it in, put the URL parameters.
25:07
I launch it and then it just tells me like 20% up, right?
25:11
For user.
25:12
And I'm like, cool.
25:13
That makes sense.
25:14
And then I throw into cloud, profit, profit analysis.
25:17
Does that make sense?
25:17
Okay.
25:18
It makes sense.
25:18
Great.
25:19
You know, it's a winning thing.
25:20
Like that's how, how we do things.
25:22
But my business partner now has gone into the route of more so like, um, ad set.
25:26
And then after that to new, new landing page.
25:29
But yeah.
25:29
How much are you thinking about like offers?
25:32
If you are like on the, on the, the, the rebuild side.
25:34
So like from a subscription perspective, like,
25:36
are you charging, like thinking about charging,
25:39
shipping on, on a rebuild?
25:40
Is the price going up?
25:41
Is it going down?
25:42
Are you throwing in free gifts?
25:43
Like, are you, are you thinking about the
25:44
retention piece and the offer for rebuilds?
25:46
So many of the clients that we have scaled
25:49
right now, uh, just like more so one time.
25:51
So like a 10 mil per month client is a one time purchase kind of thing.
25:54
Very small subscription after, um, we also have skincare.
25:59
Um, but you know, like we're starting to
26:02
push this like piece a bit more in terms of the
26:05
retention side.
26:06
One great piece of advice that, um, Zach did
26:09
give me was to like, you know, free shipping
26:12
up front.
26:12
But after that you charge them $8.795 or something like that.
26:16
And that, um, we have implemented.
26:18
So this new brand that we just onboarded
26:21
is the one that I've stopped off like this.
26:23
It's like, they were losing money for a lot of months now.
26:26
Um, went from like negative 24k.
26:29
And then like the next month was 10k net profit.
26:32
Then the next month, this month, um, should
26:34
be like 50k in that profit based off what we've
26:37
seen.
26:38
Um, and that, that was just all based off like an offer change, right?
26:42
We modeled that Javi framework, multi skew, um, different, different flavors.
26:47
And then the MSRP were just too low.
26:51
The co-founder told me like, um, oh, I think the price is too high.
26:56
Or like, I don't even think we can charge it much.
26:58
I'm like, fuck it.
26:59
Just run.
27:00
Let's see.
27:00
Let's, let's run it and see.
27:02
And, and, you know, this, this is literally what your competitors charge.
27:06
You're charging way less than them.
27:07
Why don't you, you increase your prices and,
27:10
and, you know, so they went from a one-time
27:12
offer, which was buy one, buy two, save like X
27:15
percent, buy three, save X percent, buy four,
27:17
save X percent, which in and for itself is like so big and long on screen.
27:23
We moved it to that Javi offer page style, you know, and, and that is sub first.
27:28
And then after that one-time purchase
27:29
option, it's like, if you click on it and go to the
27:32
site, no free gifts.
27:33
We raised MS, MSRP to like $74.95 and then we gave it a 50% discount.
27:39
And then the sub, the, the, the interesting
27:41
thing is, is that the conversion rate has stayed
27:44
roughly the same.
27:45
Like, like, um, the conversion rate has stayed
27:47
the same as it was a 4% increase in conversion
27:50
rate and like a 18 or 15% increase in revenue per user.
27:54
And we're getting subscriptions like every single day.
27:57
They like, we're going to get more, like in
28:00
two months time, we're going to get the entire
28:01
subscription thing that they have been doing
28:03
for like the past year plus year to two years.
28:06
And it's a script.
28:07
And usually with subscription, you see like a negative 10, 15% gram per user.
28:11
So it's like this, that was like an insane win.
28:14
And it was also predominantly by increasing price.
28:17
Now we're going to get free gifts.
28:18
It's, and the gifts are going to be related
28:20
to kind of the, the product that they sell.
28:22
And it's going to like convert even better.
28:25
And so then there are a lot, a lot of spit
28:26
tests that you can do, especially on the Javi
28:28
style page.
28:29
We can talk about that if you want.
28:31
But yeah.
28:31
Yeah.
28:32
The MSRP thing is so interesting because
28:33
at the same event that like whatever a year
28:36
ago where we were all in the same room, but we didn't meet when you talked to Zach.
28:41
Zach, I'm pretty sure we sat down with like
28:42
a handful of brand owners and like I watched
28:44
you talk to them about their offer.
28:46
And they were like, they were really hung up on like MSRP and changing it.
28:50
And you just, I don't know if you even
28:51
remember this conversation, but you were basically
28:53
like, you just need to change it until like the offer makes sense.
28:57
And like the offer looks compelling enough.
29:00
Like you sat with them and it was just like,
29:01
you just have to continue to like manipulate
29:03
some baby, an aggressive word, but like you
29:05
have to continue to manipulate and like, don't
29:06
be afraid to change the MSRP.
29:09
That really stuck with me because like people
29:11
don't, like they don't, they don't change the
29:12
base price.
29:13
Because Brian, to your point, like they're
29:13
worried that it seems too high, maybe by comparison
29:16
to like what the market is saying, or like they don't think that they can, they can
29:20
justify that.
29:21
Zach, I don't know if there's anything else
29:22
that you remember from that conversation or offer.
29:24
Yeah.
29:24
I mean, I just, I gave them the example of
29:26
hollow, which is like, dude, like we shouldn't
29:28
be charging 50, $60 for a single pair of
29:30
socks, but to hit the, to hit the discount and offer
29:33
that we want to, to make it compelling
29:35
enough to buy, to hit the AOV versus the NCOC that
29:37
I have to have to back out to the math works.
29:40
Like you sometimes have to increase prices that you can play with offers.
29:44
And yeah, their performance wasn't hitting where they needed it to be.
29:47
I'm like, it's not going to fix by you, by
29:50
you not messing with this, like this offer
29:52
dynamic.
29:53
You just have to try.
29:54
Yeah.
29:54
So yeah, I mean, that's, that's usually the
29:57
brands candidly that are stuck at that like
29:59
sub few hundred K a month in revenue.
30:01
And they're like, I just like can't break through
30:03
or like, we're just not profitable and just can't
30:05
get it to work.
30:05
Almost always it's like an offer problem.
30:07
And then obviously like, you know, creative
30:09
is a huge piece of this, but almost always
30:12
I think it's like an offer issue.
30:13
Yeah.
30:14
So yeah, Brian's, Brian's right.
30:15
Exactly how, I mean, I think more brands
30:17
need to be aggressive when it comes to pricing
30:19
and stuff like that.
30:19
Cause yeah, if you're torching cash, it's
30:22
not working like an offer change can literally
30:23
turn the business around.
30:24
Yeah.
30:25
Yeah.
30:25
We ran a pricing test recently.
30:28
Yeah.
30:28
It was a quick kind of quicker pricing test that we ran.
30:30
It's a high AOV call it in like the $400 range.
30:34
The MSRP kind of like close to $500.
30:38
And it was just like an awkward in between number.
30:41
Like I'll pick a random number.
30:42
Like for example, it was 297 or 279.
30:46
It's like 279, like the 79 feels super random.
30:49
It's like not quite 299, but it's also not 249.
30:52
It's just like this awkward spot.
30:53
And so we push them to drop it to just like get it below the next threshold.
30:57
Like they were running a $50 discount to get
30:59
it to 229, but 229 still feels kind of random.
31:02
So like, okay, try pushing into 199.
31:05
And we saw like a 40% lift in profit per
31:09
session while also being able to scale substantially
31:12
further.
31:13
And then just like a couple of times
31:14
throughout the month for various reasons, which we don't
31:16
need to get into.
31:17
It's like they go to full MSRP and it's like
31:20
MER gets shittier and they lose 50% of their
31:23
spend volume for the course of that week.
31:25
Unless we try to hold it to like continue to like maintain whatever funnel.
31:28
Um, and it's just like, it's insane what just those, those small changes can do.
31:32
Even if it's like the change is not that meaningful.
31:35
It was a, it was a $30 change on a really expensive product.
31:39
And, uh, it, yeah, 40% increase in profit per session.
31:42
Insane.
31:43
The, it's just pricing psychology.
31:46
It's like, why have your price at 35.99 when you can have it at 39.99?
31:53
Like, or 30, why you have your price at 37,
31:56
38.99 when you can have your price at 39.99,
32:00
right?
32:00
It's, it's something that also, that's how
32:02
you can squeeze a couple of dollars of profit,
32:04
um, per, like for order whatsoever.
32:07
And, and something like, for example, a lot
32:08
of people run the, the buy one, buy two, get
32:10
one, buy three, get two.
32:12
And then you run the, the sub offer on top of that.
32:15
Right.
32:16
And so your, your sub fifth after 15%, you
32:19
get your prices at, let's say you start at 29,
32:21
you get your prices to like, I don't know, 20, 22.99 or something like that.
32:26
Why not make that like the, after the discount, after the sub discount, 24.99.
32:32
It's the same thing.
32:33
You're going to make more money off that.
32:34
You're going to get the same conversion rate, a higher revenue per user.
32:36
Why?
32:37
Just because like people view it the same.
32:39
That's why all the stores, they put it like,
32:41
and at 9.99 or 9.97 or some bullshit like that.
32:44
So it's like, yeah, it's like the pricing part is so important.
32:49
I see so many people, they put like their price at $85.
32:52
I'm like, why not $89?
32:54
It's like, why put it at 85?
32:56
So like, that's how you squeeze.
33:00
Like, this is where we like squeeze so much
33:01
of the profit, all these little small changes
33:03
that we've made onto the site.
33:05
And if like so many more like CRO wins that
33:07
can go through, they're like super obvious,
33:10
but like have really made a substantial difference to our business.
33:13
Even though we don't run CRO, it's just like common sense.
33:16
You know, like we're not a CRO agency, but we technically run it like that.
33:19
The Amazon thing is super interesting
33:20
because the one I just, the one that I was talking
33:22
about, they did the, they intentionally did it.
33:25
Well, they intentionally left the MSRP higher.
33:27
They didn't like go raise the price, but like
33:28
Amazon, and I'm sure there's like some Amazon
33:30
pricing things you have to consider for
33:31
this, but their Amazon is listed at the MSRP.
33:33
And then they have a nice little, you know,
33:36
it's not an always on offer on the website,
33:37
but same thing.
33:38
Like it launched on Amazon and the website stayed the same.
33:42
Pricing was better on the website by a small amount, even though MSRP was listed.
33:46
So there was a discount and they saw like,
33:48
okay, yeah, Amazon went from zero to a couple
33:50
thousand dollars a day.
33:51
But the website went from, you know,
33:53
whatever, 50K a day to 60, 70K a day, because to your
33:57
point, like the pricing psychology and like, oh, now it feels like a better offer.
34:00
They saw the exact same thing.
34:02
Since we're going, since we're going bar for
34:03
bar on tests right now, let me tell you about
34:05
a loser.
34:06
It's pissing me off.
34:08
We launched a, we have a test rolling right now.
34:11
It's just a, it's a PDP test.
34:12
Well, the original version, when they redid
34:14
the PDP, they relaunched it with like an AI
34:17
summary of the reviews.
34:18
And to me, I'm like, okay, that's interesting.
34:20
Like Amazon's got the AI summary, but like, I
34:21
just feel like customers are kind of like averse
34:23
to AI things.
34:25
Maybe not with reviews because it's on
34:26
Amazon, there's that summary, but there was no, you
34:28
couldn't read actual reviews.
34:30
And to me, I was just like, felt like, ah,
34:32
it feels weird, especially because there's
34:33
tons of glowing, like they have great reviews, 4.7 stars, tons of awesome photos.
34:37
Everything is great.
34:38
So the test we're running right now is the
34:39
summarize version against the full review
34:42
widget.
34:43
The summarize version is winning by 10% profit per session.
34:46
And it's pissing me off.
34:46
It's like, it makes no sense to me.
34:48
Because like, to me, it's like, you'd want,
34:49
you would assume customers on a high AOV product
34:52
would want to read real authentic reviews from other humans.
34:55
Um, but apparently they like the, the
34:57
summarize version and it literally says AI summary.
34:59
No, no, but that's a really good idea.
35:01
That's interesting.
35:02
Um, that'd be super interesting.
35:03
That, um, what's front row, front row MD just came out with that.
35:06
A bunch of people are testing this like clinicians AI thing.
35:08
I don't know if you guys have seen that.
35:09
IMAID's doing it.
35:10
And I know a couple other brands are doing
35:11
it where you land on a PDP and you can ask
35:14
clinician AI about the product.
35:16
Um, super interesting.
35:17
We tried to, I tried to break it yesterday
35:18
for IMA by asking it like, will this heal,
35:21
cure my whatever disease?
35:23
And it was, it was, it was pretty good about response.
35:26
Yeah, I'm sure.
35:27
I go follow Brian on X.
35:28
Brian, B-R-I-N-N-J-H-O on X.
35:32
Brian, thanks for being here, man.
35:33
This is great.
35:34
Thanks, man.
35:37
The only way that we grow this podcast is by you sharing it with your friends.
35:42
Honestly, like reviews kind of don't really mean anything too much anymore.
35:45
They're really meaningful, but they don't do a lot for the growth of the podcast.
35:48
Um, and so sharing YouTube links, sharing Spotify links, sharing Apple, whatever we
35:54
call it under the podcast app.
35:55
Now, anything you can share the better we're going to be.
35:59
Um, guys, anything else you want to say on this?
36:01
Yeah.
36:02
Please go check us out on YouTube, rack up those views for us.
36:05
We'd love to see it.
36:05
And then subscribe, make sure to subscribe on YouTube as well.
36:08
And I relentlessly refresh the YouTube
36:10
comments because it dictates my mental health for the
36:11
day.
36:12
So please say something nice about all of us.
36:15
Thank you, everyone.
36:16
Thanks for listening.
36:17
Honestly.