What is the Best (and Worst) Ecommerce Niche in 2025?

[00:00:00] Richard Gaffin: Hey everyone, Richard here for today's Ecommerce Playbook Podcast, we are featuring the latest episode of the DTC Hotline. Now, in case you haven't heard the pod yet, the DTC Hotline is a new podcast from CTC that's hosted by me and features Tony Chop and Luke Austin, who you've heard on this program many times. They are our VPs of paid media and ecommerce growth, respectively.

So, here's how the DTC Hotline works: we field real questions from listeners and then Tony and Luke respond with their hot takes. And in fact, we have a real call-in line where you can leave a voicemail, or you can send a text with your questions to be answered on a future episode.

We have some great questions on this ep. You're about to hear about what to do when your Meta ads fall off a cliff completely, how to balance brand standards and performance and a lot more. So, if you like what you hear, please go follow the DTC Hotline wherever you get your podcasts. Okay, here is the latest episode of the DDC Hotline.

Alright, welcome folks to the DTC Hotline. This is your direct connection to hot takes, cold truths, and real ecomm advice from some of the best in the business. So call or text 866-DTC-2263 to get your burning ecomm questions answered. That's 866-382-2263. Leave a voicemail, send us a text asking whatever's on your mind DTC-wise, our operators are standing by.

You see what I did there? Speaking of operators, let me introduce him to you. We've got coming in from his home in beautiful Newport Beach, California, Mr. Tony Chopp, “The Chopper,” VP of Paid Media here at Common Thread. Tony, what's going on today, man?

[00:00:38] Tony Chopp: Richard, I'm here for it. I got contractors in my house working on flooring and paint and stuff, so

[00:00:44] Richard Gaffin: Yeah.

[00:00:44] Tony Chopp: a whole collection of interesting problems that are not media accounts, which is fun.

[00:00:50] Richard Gaffin: Yeah. Yeah. There you go. Oh, they're doing paint. So maybe the fumes could come through and kind of take you to another level of insight. I think that's what we're looking for here. Yeah. Yeah, exactly. Okay. And we also of course have CTCs, VP of Ecommerce Strategy, Mr. Luke, “The Weatherman,” Austin coming to us live from CTC HQ in Costa Mesa, California.

How you doing today, Luke?

[00:01:10] Luke Austin: I am doing great. It is a, it is a happy Monday my. We have two kids under two. My wife had

[00:01:16] Richard Gaffin: Mm-hmm.

[00:01:17] Luke Austin: bachelorette party, so I was solo, solo dad Saturday, Saturday night into Sunday morning.

[00:01:23] Richard Gaffin: Mm-hmm.

[00:01:23] Luke Austin: It was a lot of time with the kids

[00:01:25] Richard Gaffin: Yeah.

[00:01:27] Luke Austin: I'm very, very happy for this. For this Monday.

[00:01:30] Richard Gaffin: Yeah. Yeah. Solo. Solo dad time's over.

[00:01:32] Luke Austin: Yes, exactly.

[00:01:33] Richard Gaffin: Now, now the only responsibility is to answering questions with the hottest take possible. So, alright, well just a real quick, a couple words about how it works. We will get questions from listeners and questions from members of our ADmission membership service here, Common Thread, and then we let Tony and Luke, and.

And they'll answer those questions for you. So, really exciting stuff here because we have a couple actual voicemails to play for you guys from a couple of callers that called 'em with some interesting dilemmas here. So, without further a deal, let's get to the first one here. This is a question around media buying tactics, but there we go.

[00:02:06] Caller: Hey guys, how you doing? Um, I'm a huge fan of the DTC Hotline and, uh, I just had a quick question. Um, I have a media buying tactics question specifically. We're a smaller brand and we have one meta campaign that has had really positive historical performance. But it seems like it stopped working out of nowhere over the last few days.

Uh, I'm just curious how would you respond to this? Um, and I would really appreciate any insight you could give me here. Thank you so much and I look forward to hearing your response.

[00:02:36] Richard Gaffin: All right, let's so it to you guys.

[00:02:38] Luke Austin: First like to say, that was a very glow, Glowing review.

[00:02:42] Richard Gaffin: I know a fan already after only three three episodes.

[00:02:44] Luke Austin: is, that is,

[00:02:45] Richard Gaffin: I

[00:02:45] Luke Austin: that is

[00:02:45] Richard Gaffin: that.

[00:02:46] Luke Austin: all we needed.

[00:02:46] Richard Gaffin: Yep.

[00:02:47] Luke Austin: but appreciate the question. So, what we like to do in having conversations around historical ad performance is. First have conversations around auction dynamics and how those can, can impact things.

And so we all know what goes into or, or many of us know what goes into auction dynamics on meta related to the expected conversion rate that meta has against your ads, the CPMs associated with your, your customer. And in the click-through rate against those ads. And similar on, on Google, you have you have similar dynamics in the ad rank playing into it. But that's all to say that. could be any one of those factors or any others that are contributing to the campaign, not spending through its budget anymore. And the other conversation that we like to have about historical ad performance is in the context of. Forecast and models, which we do a lot of here at CTC, which is that we know that historical performance is not indicative of what the future outcome is going to look like.

It's going to give us some baseline to measure against, but we are gonna land at some extent over or below that that outcome. So that's the caveat of like, it could be any, any number of a thousand different factors playing into it related to the auction dynamics, related to the historical performance related to the competitive or categorical landscape related to those things.

So that aside and us sort of taking into account here that there's probably not things related to the product inventory or availability or sizes, things like that. That, that has all held consistent.

[00:04:17] Mediaboard_sounds: hotline

[00:04:18] Luke Austin: the simplest answer would be.

[00:04:19] Mediaboard_sounds: quick question.

[00:04:20] Luke Austin: ads were working at one point in time for that audience at that point in time.

And now you need to meet a different audience in a different way in this, in this new time.

[00:04:28] Mediaboard_sounds: campaign

[00:04:28] Luke Austin: ties back to creative demand and then diversity around your creative output is, is

[00:04:33] Mediaboard_sounds: it

[00:04:33] Luke Austin: likely going to be the thing that unlocks that. Now

[00:04:36] Mediaboard_sounds: just

[00:04:36] Luke Austin: How long is that gonna take? What is the output gonna be like?

There's a lot of nuances we could, we could

[00:04:40] Mediaboard_sounds: you could

[00:04:40] Luke Austin: dive into there of, of how we think about that, but at one point in time. The existing ads and messaging that you had resonated with a core group of customers and they aren't in the same way. For some reason, that could be a myriad of reasons. So finding the way to resonate with the customers in that way. Is really the thing that needs to, needs to be, needs to be looked at because there's so many things that we can do. Like, look, let's look at, okay, what, what has changed? Has the conversion rate dropped off for the past two weeks versus the prior few weeks? Is it the click-through rate? Is it your CPMs have changed dramatically in some novel way?

Li likely not the case, but Okay. Is it click-through rate related CPM related? Conversion rate related. Okay. We can kind of like now go down the paths of each one of those things, but. your product is outta stock or you're running a sale that you're not running anymore, something dramatic like that. It's likely related to meeting, meeting a customer at a specific point in time, and the constant need for creative volume, more creative volume, more creative diversity being the thing that's necessary to find that again.

[00:05:44] Richard Gaffin: Tony.

[00:05:46] Tony Chopp: Yeah. Yes, so I, I feel sometimes. The pull, when we get these questions that sound like is working or everything's broken, I fuel the pull into more specificity. So, which is kind of what, what Luke is talking about. When, when we say is working, does that mean that spend stopped or slowed down dramatically?

Or is it an efficiency, so I think one of those two things is, is important to understand. But one, one other thing that popped into mind is the, the nature. Of how dramatic the shift is can be a clue. So for example, if you went from spending, if 90% of your spend got cut like overnight, is a signal that it's probably something policy. Or pixel or payment. Right? And sometimes those errors, sometimes the, the ad operations piece of the puzzle can be a little bit difficult to sort out like, where is it actually coming from? Is it payment, is it policy? Is it pixel? Huh? Those things are all p that's kind of nice. 

[00:07:00] Richard Gaffin: There you go.

[00:07:00] Tony Chopp: my point being is that the. If it's a super abrupt thing, like we were spending a couple thousand dollars a day, now it's a couple hundred dollars a day, then the problem is likely more deeper in the

[00:07:15] Richard Gaffin: Mm-hmm.

[00:07:17] Tony Chopp: If it's more of a gradual to Luke's point about like, oh, we've seen, if we look at conversion rate and it's trailing down over a seven or 14 or a 30 day period, we look at. CPMs and they're training up over a seven or 14 or 30 day period, then that's gonna connect back to where all roads lead with meta, which is we need to keep fueling the fan.

So when you're thinking about troubleshooting significant changes in performance to Luke's point, we're, we're assuming that it's not a website issue, although one time we spotted one of these where, there was a notable change in performance from an email popup that was showing up on, on all of the pages of the site and sort of change that user experience.

So think about your website, think about your checkout process, look over there. Pay attention to whether the change is really, really sharp and really dramatic. Or if it's a smoother curve, 'cause that could be a clue where to go look.

[00:08:13] Richard Gaffin: Right. I love that. So first payment policy pixel, three Ps. Let's clip that. I like that. That can be a, a new little nugget of chopper wisdom. But so the, the payment policy pixel thing, that's what you look at. If it's a short-term, a short-term dramatic drop is essentially what you're saying.

[00:08:30] Tony Chopp: Yeah.

[00:08:30] Richard Gaffin: And then if it's over a longer period, now the sense I get from this, and what I've heard from other people too is like, this is a dramatic drop off.

Over a, let's say seven to 14 day period of time. Right. So is is part of what we're saying here that like for some reason everybody just decided that, or, or the, the audience for this particular message just kind of vanished over that short of a period of time? Or is there potentially something else going on there?

[00:08:58] Tony Chopp: W Well, so I, the first thing that comes to mind is like, I'm looking at the ads and I'm looking to see if spend is moving between ads like so, as a function of potentially CVR or some other input signal in, into the metric. But I think if you see degradation in performance, you're likely gonna see. Delivery, changing between various ad units in the account. And there's things that you can try to, to, impact that. So, you know, if you have an ad that is was historically a really, really great performer, but for whatever reason, one reason or another, it's delivering less and then other ads are delivering more in that same, in that same campaign.

You can try to it into its own, into a new campaign and get delivery that way. But these are just band-aids. Back to Luke's point that particular unit of creative that its ability to reach its audience has has, has diminished. So

[00:09:54] Richard Gaffin: Yeah.

[00:09:54] Tony Chopp: can ask your meta rep too for a creative fatigue report.

There's a, there's some data points, some signal you can get around how meta interprets the, the fatigue of that creative that may be useful. But I don't know. This is gonna be an annoying advice that we're gonna keep saying over and over again, but I, I spend less time like figuring out like how to,

[00:10:13] Richard Gaffin: Yeah.

[00:10:13] Tony Chopp: manipulate the platform and go figure out how to make some.

[00:10:16] Richard Gaffin: Yep. Create a volume creative diversity. Turns out that's the answer. All right let's go to our next our next caller here.

[00:10:23] Caller: Hey guys. Love the DTC hotline. I think it's fun. Would really appreciate like any answers on this. So I have a client who's really particular about their brand standards and it's affecting our ability to diversify our creative and kind of scale up. So how would you go around that conversation with the brand and if they're stubborn and won't budge how do you work within their standards?

Would love kind of any oversight you have there. And keep doing what you're doing. Thanks guys.

[00:10:49] Richard Gaffin: There you go. Another fan. What do you say, Luke?

[00:10:52] Luke Austin: First I would. Talk to as many people, people as possible in terms of their perspective on what the brand standards are, how they would articulate them. My, my experience with this conversation is that there tends to be a lot of opinions but there does not tend to be consistency. That number of opinions as you branch out more than one or two people. And, I'll give a specific example. So, we there's a client of ours that, that comes to mind that has a, a very high view of their es as aesthetic and how they would like to be perceived and positioned as a brand in the market. We went in person to their office and spent a whole day with four key stakeholders talking about that very thing about creative, creative content diversity, what their, what their perspective of their brand image and their brand standard is in, in their minds.

And each of them had different things actually to say about what that meant to them and what was important. That time, one person's. and perspective will tend to create sort of a narrow rut, right? Because they'll, they'll bring that when you even bring other key stakeholders within the same organization, they may bring different angles to it and expand that further. And something I, I think, I think Taylor tweeted it out actually earlier today, whereas where, something along the lines of creative diversity is not so much like. Trying to force yourself or one person's brain to think more diversity about more creative formats, but it's diversity of sourcing of the creative.

It's diversity of production. So rather than, oh, let's think, let's, you and me keep thinking about ways to diversify it, it's let's go find a different production source or a different or a different yeah. Source of the creative that we're, that we're getting that's gonna help to diversify in the format. So similar principle for this conversation. Get the people together, get all the opinions, and I think that in itself, that conversation will actually expand the breadth of like, what's possible to us, because it'll be four people in a room instead of two, right? Or six instead of three. Whatever it is that'll be, that'll be helpful. And in that conversation, bringing examples of. Other brands to the table especially brands that we on the client side or on this side, like that we all think about when we think about who we would like to be or who we aspire to be, is a helpful thing to have as a frame of reference to look at, oh, we wanna be like this luxury brand, or we wanna have this sort of aesthetic.

And then you actually see the diversity of creatives or the creative formats and types that each of those brands are running. It actually, that'll help expand it as well to be like, oh, that brand is perceived in that way, but. also run really social native lo-fi creator content. Right? Okay, cool.

Maybe, maybe it's okay for us, right? And it expands that way. So bring that to that conversation. Get multiple perspectives. And then ultimately performance is gonna be the thing that's likely going to convince convince someone, especially if they're. They're connected to the business outcome in any way. And so being able to create a situation, even if there's, hes hesitancy to test out different formats of creative and different content types and may, the, may the best creative win is ideally the scenario you get to and that's the thing that it's assessed by.

[00:14:05] Richard Gaffin: no one, so one thing that's, I think it's important to call out there, the, I think is a really interesting insight, is the idea that like if there's a brand you're working with, with really stringent brand standards, it may be the case that it's not the brand standards, it's the point of contact at the brand standards for the brand or whatever, right?

And if you actually have a conversation with more of the stakeholders on that side. You would discover that they're actually maybe not as strict as you had originally thought, and that that maybe actually one person's opinion and bringing more opinions to bear would actually kind of expand the range of possibilities that you have, right?

[00:14:37] Luke Austin: Yeah, that, that's exactly right. And I think the, the idea, everyone, I think would, their idea of their brand would be that it would exist outside of any one person in that way. That,

[00:14:49] Richard Gaffin: Mm-hmm.

[00:14:50] Luke Austin: lends itself when a, when a brand or a product or an idea inspires you to think about, to add a different point of view to the conversation, is actually a positive reflection on the brand that helped, that inspired that for you, even though it may not, may have not been the original intent. Which is challenging right as thing because things are are always changing and always evolving to be able to like hold that of like, oh wow, I think our brand and our product's actually taken on. A different dimension. A new dimension. How could we cultivate that? Is that something or is there a risk inherent to that?

So there's, there's definitely an openness that's necessary in the conversation. 'cause we all have, we all have opinions and perspectives that are different. But I think the, the, the best outcome is when those, those perspectives are combined to create a, the bigger picture of a thing.

[00:15:39] Richard Gaffin: Yeah, Tony.

[00:15:42] Tony Chopp: Yeah, I, I agree with everything that Luke's describing. I think the, the Meta Ads library is a, is your best friend in this endeavor connected to Luke's point about like, let's go look at some of the brands that, that your, your client aspires to be like, and, and see what they're doing. I think, I think they might be surprised.

I wouldn't, I wouldn't be shocked if that was the case. We've tried to do some stuff on the media side over the years to, to de-risk the exploration. So, and there's, you know, other companies out there like Tube Science that, that have this sort of business model where they'll you know, cover some of the cost of creative production, that sort of thing.

To actually, to Luke's point about like made, made the best. The most performant piece of media win. So I think you can explore some ideas around, you know, removing some of the risk from some of the things or trying to limit some of the risk from some of the things that are, that are scarier. And you know, another thing came to mind as Luke was talking about, like this idea of the, the ethos of the brand. Having there be some common denominator that's deeper yet more yet still more malleable than fonts or a particular style of photography. So I heard, I overheard Taylor this morning talking about liquid death as an example of a, a brand whose marketing message ethos. Is about really about having a sense of humor. And that plays out in a lot of different ways, in a lot of different formats. As opposed to, you know, this really type of product photography, the product always has to be featured on, you know, in, in this particular environment or whatever else. So one of them, the latter is like a really, really specific detail. Look and feel sort of treatment. The liquid death example is more of an ethos. Like, what, what, what do we want this brand to feel like? That I think opens up some, some conversation.

Hey everyone. I just wanted to take a few seconds here to talk to you about admission. Our membership program here at CTC, that gives you access to one-on-one consultations with our growth experts, as well as weekly live events and access to our gated library of e-commerce trainings. This is the best way to work with us here at Common Thread Collective if you're in the six to seven figure range.

Now, to get started, all you have to do is book a call with me. To talk more about it@youradmission.co. That's your admission.co. Alright, back to the show.

[00:18:17] Richard Gaffin: Yeah. No, I like that. That's an important point that, yeah, I, I've talked about with Taylor on this week's episode of the e-commerce playbook around the idea of having the brand standard be actually thematic more so than actual like, oh, we use this font, or we use this one design asset, or something along those lines.

And that's, that's totally necessary in a world where you have like a diverse set of creators making your stuff. So. Okay. Cool. Let's let's jump onto our next one.

[00:18:41] Caller: Hey y'all. Yeah. So I just wanted to know if you've seen any success with top of funnel campaigns like optimize for add to cart, or any other leading metrics rather than conversions. Ah, thanks all.

[00:18:54] Luke Austin: I just wanna say out of outta the gate, we did not get any positive feedback on the show from that question. So

[00:19:03] Richard Gaffin: There you go.

[00:19:03] Luke Austin: that was heard.

[00:19:04] Richard Gaffin: That's right. Yeah, yeah, yeah.

[00:19:05] Luke Austin: straight into the

[00:19:06] Richard Gaffin: All business. Exactly.

[00:19:08] Luke Austin: depending on the answer here, we can get, we can get some,

[00:19:10] Richard Gaffin: Make a fan.

[00:19:10] Luke Austin: so, yeah. 

[00:19:11] Richard Gaffin: I.

[00:19:12] Luke Austin: Danielle, I'll kick it over to you.

I've, I've started out on each one so far.

[00:19:15] Tony Chopp: I mean, the short answer is. All of these things, every single tactic that you all can bring to me in a question, I'm gonna tell you, this is a tool in the toolkit. There is no right or wrong in any of these things. It's like telling me a screwdriver is wrong. Like it doesn't make any sense. A

[00:19:34] Richard Gaffin: Mm-hmm.

[00:19:35] Tony Chopp: is the right tool if you need to screw something in.

[00:19:39] Richard Gaffin: Yeah.

[00:19:40] Tony Chopp: So, when you think about. Quote unquote, top of funnel campaigns or non-con conversion optimized campaigns, you have to think about what is the job that you're trying to do and what is, what is the tool that needs to be deployed?

[00:19:54] Richard Gaffin: Mm-hmm.

[00:19:54] Tony Chopp: So top of funnel campaigns, whether it be. Awareness or or traffic or maybe what even might be considered like mid funnel campaigns like optimizing for an ad to cart or a non purchase event are gonna have some attributes that are, that are quite a bit different than conversion based campaigns. Notably, the traffic's gonna be a lot cheaper. The CPCs are gonna be a lot cheaper. CPMs are typically gonna be cheaper, so, And, and at the same time that traffic isn't going to convert nearly as highly as a conversion based campaign. So what, what I think, what I think is important is there's a. There's a really important distinction around where your brand is at in your journey. So if you are a brand new brand, if you are zero to $5 million, have a long way to go using conversion optimized campaigns as your primary source of traffic. Very long way as you start to get into 10, 15, $20 million plus I, what I believe is that you have. It is prudent and smart and appropriate to be making an investment in. Awareness into net, net new eyeballs for the brand, recognizing that those aren't going to show up as really high performing campaigns. but we found really cool ways to look at the connection between investment and awareness or our mid funnel optimization and the performance of our conversion optimized campaigns as it shows up in engaged audiences or, or even frequency.

So. No right or wrongs. It's a tool in the toolkit that, that, that has a place, especially as the brands grow.

[00:21:43] Richard Gaffin: What do you think Luke?

[00:21:44] Luke Austin: is if you're genuinely curious about understanding what the opportunity of an opera funnel optimization tactic could look like, whether it be adding card and shade checkout or up the funnel or doing an awareness need to buy. Expand your time horizon, whatever you're thinking is the time horizon necessary to be able to measure the impact of this? Stretch it out. And there's, I'm trying to remember the name of the report from Meta, but they, they put something out. Now I think we have, take this with a grain of salt, but like how the full, the full effects of upper funnel or awareness media can't even be measured within a six month timeframe, which is the maximum duration of sort of their conversion lift tests. Look back. So like, there's even a constraint there of what we see for incrementality tests that we run. If we run an incrementality test for 30 or 45 days, we see the post test treatment window having a meaningful impact on what that, that test read full, full impact actually is. And so as, as you expand higher up in the funnel. I think the idea is that you're getting in front of customers that are less ready to convert immediately. That's like tip tends to be the hypothesis associated with like, I wanna go up the funnel so that I can get in front of folks that are higher up in their consideration. Journey with me. Now that debate aside, if that's true, it's going to take longer than you think to realize the full impact of that media spend. And so expand out your time horizon and then set up set up measurement associated with it. That's actually going to give you what you, what you need. So run a conversion lift on meta. And run an incrementality test at the same time, or run a brand lift on Google, like have, have the measurement set up in a way that's actually gonna give you the signal and expand out your time horizon. 'cause if you're hoping to run for even 14 to 30 days an ABBA cart campaign and see a meaningful change or incremental impact in the business, like it's, I think you're going to be left wanting. And the dollars would just go back to conversion media if you have them under the same time horizon in which you're assessing the results.

[00:23:45] Richard Gaffin: Right. So as part of what you're saying that kind of like a good way to assess whether or not these quote unquote, top of funnel or really awareness campaigns are worthwhile is, do you have a six month to one year time horizon to make a decision here or to assess the efficacy of the spend? And I think for a lot of brands that are below, let's say, let's say the eight figure range or whatever, they don't have six months or a year.

They have, they have to be thinking in terms of these like. You know, weeks, days, months. Whereas a larger brand has maybe a little bit of the luxury, let's say, to be thinking about the efficacy of ad spend over the course of like the next year or whatever. Is that like a fair way to, to summarize that?

[00:24:25] Luke Austin: Yes, it, now the specific time horizon is gonna change based on there's, 'cause an add to cart optimized conversion campaign versus an awareness optimized meta campaign. Like there, there's, it's gonna have different impact and different time horizon. But the specific aside of the, the time length against it the expand out, expand out the time horizon, and then. Run, run a thoughtful measurement alongside this test in the form of at least a conversion lift test within the platform, if not an incrementality test layered on via a third party tool as well.

[00:24:58] Richard Gaffin: Yeah. Tony, I wanna go back to your metaphor about tools in the toolkit. So what's the, let's say that aware, like an awareness campaign of some kind. Is the screwdriver, what situation is the screw? When is that? Is, is that a tool that makes sense?

[00:25:14] Tony Chopp: Well, I can tell you where, where we see it in our brands is you know, measuring, like looking at new traffic that's coming to the site, like percent of new traffic that visits the site. We can get really high percent of new eyeballs for a brand by using. Upper funnel media, you know, and I think the shit I had, I had another analogy. Oh, I know what it was. So back to the tool, right? So I got my toolbox here. The way that I think about this game is not like which one of these tools in this tool toolkit is. right tool. It's that I want to, I want to have more tools and I wanna know how to use more tools. So what do I mean by that? Well, don't spend 90% of your media budget on awareness media. That's bad. That's never gonna work in any case, rather commit to five. Maybe 10% of your budget over the course of a year into this tool. Luke's point about the measurement, dial in the measurement if you have, if you have a $10 million a year media budget. Pencil out, $500,000, $600,000 and figure out, all right, we're gonna deploy this. We're gonna deploy it with measurement. incrementality. I like, I like conversion lift on the platform. I even like qualitative data, like post-purchase surveys, like customer reported. How did you hear about us stuff to sort of triangulate in on whether or not this, how this media is impacting the mix. I think, I think the caution, the caution that I want to add here is this. I think this is the. This is the, the thing. It's not whether or not this works, it's understanding how it's playing into this bigger recipe.

[00:27:08] Richard Gaffin: Gotcha. That makes sense. Okay, Luke, any anything else on that?

[00:27:12] Luke Austin: No, said this earlier, but like the there's just likely other areas I would go before doing an ad car optimization on meta. If, if I'm looking for ways to expand, expand, like I would, I would figure out how to make YouTube work. We're seeing really strong results

[00:27:30] Richard Gaffin: Hmm.

[00:27:30] Luke Austin: across a, a large set of our, our clients. I, I might, I might go see how many Snapchat free ad credits I could go and get because they're given those away this time of year in a way that makes that more appealing. Yeah, so I, I think there's just a few other areas and then, yeah, now withstanding Google, just the core campaigns in Google and the opportunity that exists there. But that lends to Tony's earlier point of like, where. how, how far can you, how, how far can you take your current channels in terms of the contribution for the business instead of looking at these other areas first. But that's, that's the only point I would make regarding looking for incremental opportunity in these other tactics versus expanding meaningfully into a net new channel.

Yeah, in a

[00:28:17] Richard Gaffin: Yeah. Gotcha. Cool. All right. You fells Got time for one more?

[00:28:22] Luke Austin: Let's do

[00:28:22] Richard Gaffin: Yeah. All right, let's do it. Here we go.

[00:28:25] Caller: Hey guys, big fan of the new podcast and format my question. I know you guys have talked bit about how difficult scaling an ecomm brand is right now, but if you could start an ecomm brand, is there any product or niche would choose or also avoid?

[00:28:48] Luke Austin: There. There are a lot there. There are many. There are many I would avoid.

There'd have to be meaningful LTV increase on the product. Like not a hundred percent increase in a year, like, like 200% increase in a year or opportunity to get really meaningful, you know, 80 percentile outcome or better in terms of LTV increase. I, also would be most interested if there's. If there's influencer leverage or involvement in the brand, if it's creator, if it's creator oriented brand, someone that is a natural creator that has a following that can create a meaningful organic demand through their following would be the other thing that that makes it that makes it interesting as well in addition to the LTV associated with the product.

And then. Those, I think those would be on the top two on my list. There's, without, without getting into too many more specifics around like where, where it sits. But if there's, if there's meaningful LTV and then there's distribution opportunity within an our, within a creator influencer that has organic distribution and impact and it can also feed the content engine of the brand. I think that's a really interesting one too, as a foundation.

[00:30:04] Richard Gaffin: I like that. Okay, so, TikTok influencer comes to you and is like, Hey, I got a supplements brand, or something along those lines. Like what?

[00:30:10] Luke Austin: I got a supplements brand and we're, it's, you know, 18% landed costs and we're doing 10 million a year

[00:30:18] Richard Gaffin: Hmm.

[00:30:19] Luke Austin: then. No.

[00:30:20] Richard Gaffin: As a smart, as a smart influencer who know, knows their landed costs. I like that.

[00:30:25] Luke Austin: Exactly. Yeah.

[00:30:26] Richard Gaffin: yeah, yeah. All right, Tony.

[00:30:29] Tony Chopp: Yeah, I mean the supplements one is one that always pops up, right? Because when it's, when it's sort of wired up correctly, it's just it's wild how it works between the super low cost of delivery and the LTV. It's incredible. it, the supplement space has a unique set of challenges that are specific to the supplement space. Number one, depending on what you're selling, the ad platforms get real touchy about their policy stuff. And you might very well have an uphill battle on at some point in time. I'll, I'll tell you this, if you're gonna do a supplement business at some point in time, you're the front end of your business on the ad ad running is gonna fall out from underneath you and you're gonna have to fight some policy battle that you didn't expect.

And it's, so that's like the, the challenge with that. But, and it's a hard question to answer because I, I've seen businesses in all categories work really well in their, they're product driven and they have a brand story and it, and it works. And I've seen businesses in all categories that sort of lack the ethos that it's just an uphill slog. So I, I'm sort of a bit less married to the, the category. And more to the, the product itself. And to Luke's point about if your products are. Causing customers to become loyal and come back and buy. You, you definitely have have the, the ethos of what, what it takes otherwise if, if that's not true, you can, you can sort of juice the thing with paid media for as long as possible. But it's, it's never gonna get off the hamster wheel if you don't have products that people, you know, appreciate.

[00:32:12] Richard Gaffin: Yeah.

[00:32:13] Tony Chopp: just one, one other little quick caveat because I've seen this in a couple spaces. Like, so we spend a bunch of time in, know, supplements and apparel and beauty and things like that. Over the years, I've seen a couple of sort of non-traditional e-commerce advertisers, like auto parts. Absolutely crush it because it's a little bit of arbitrage in the sense that Facebook isn't like the hugest, thing that people think about when they're just running an auto parts thing or, so I think like I was gonna do it, I would find some sort of, I would be interested in find, finding some sort of category that I feel like I could arbitrage into the media space with what I know as opposed to just like. war supplements. So this is the last thing about supplements. Everybody knows the game. It's a game of inches. All your competitors are, are running at, at, at, at most break, even cac and most likely some sort of first order loss because of the LTV mechanics. So if do the supplements, but it's, it's, it's a night fight.

[00:33:16] Richard Gaffin: Yeah, yeah, yeah. Totally.

[00:33:17] Luke Austin: say, I was gonna say the same thing that you ended with there, Tony, with the other, like we've, on the other side, it's, there's high a OV brands, high a OV, little to no repeat purchase that are selling auto parts and high average order value plants and that like live in this whole other category of very low competition.

Much more niche. And little to no LTV. That's fascinating. And many of these, these businesses that you can just build, like where we think about building on meta as the core demand engine. These are built on Google and Google shopping and owning these key, these core keywords where there's a lot of search intent

[00:33:54] Richard Gaffin: Mm-hmm.

[00:33:54] Luke Austin: driven around these categories and, and much less competition.

That's a totally different game and also a fascinating one that, that, that we've enjoyed being, being a part of. So

[00:34:04] Richard Gaffin: Yeah. Yeah.

[00:34:05] Luke Austin: pick one. Pick one side. Pick one side. low a OV, high a OV. Niche, no, LTV. Those are both fascinating games.

[00:34:14] Richard Gaffin: Alright. There you go. Love it. Alright guys, well I think that's gonna wrap it up for us. So thank you to both of you Of course. And thank you to our intrepid callers for calling in. If you guys listening out there, want your questions answered on this pod, you know who to call, leave us a voicemail, 866-DTC-2263 or send us a text at that same number and we might read your question or play it.

On a subsequent episode, we want hear from you. These two guys want to answer your questions and solve your problems, so please call in. All right, for Luke, the weatherman, Austin and Tony, the chopper Chop. I'm Richard, the Professor Gaffin. Appreciate y'all listening, and we'll talk to you next time.

See ya.