Growing Profitability featuring Chris Lutz of Duke Cannon

[00:00:00] Taylor Holiday: Welcome to another interview episode of the ecommerce playbook podcast, where we are dissecting the GQ giants to find out what makes big brands grow predictably and profitably. And today we have a giant, we have Duke Cannon Supply Co. You may know them for their big ass brick of soap or selling consumables to men in particular in the grooming category.

They've got soap, they've got shampoo, they've got all sorts of amazing products with incredible design, and thoughtful merchandising. And today we're going to be joined by Chris Lutz, their director of digital and ecommerce, who's going to join us to talk about the journey that actually began from an alternative beginning point from many of the brands that we interact with here, and that they grew up in specialty retail.

They grew up with much broader distribution from their start and have evolved the brand. To have their direct business serve a broader purpose than just trying to sell a bunch of stuff. It's got an intention for gathering data and understanding brand story and helping to think about different ways to sell and communicate their product.

Lots to explore. This is an amazing brand. You're going to enjoy it. Chris Lutz, Duke Canon.

[00:01:02] Taylor Holiday: Welcome back, everyone. Excited for this episode today. I am joined by Chris Lutz, the director of digital media and ecommerce at the Duke Canon supply co Chris, thanks for coming, man. 

[00:01:14] Chris Lutz: Thanks for having me. Happy to be here.

[00:01:16] Taylor Holiday: So Chris and I have had the pleasure of working together now for just almost a year, or we're getting close to, to a year here, right?

Maybe even just over it. 

[00:01:24] Chris Lutz: Coming up in a year. I think we had some conversations. The year prior, so we've definitely been in contact for longer than a year.

[00:01:34] Taylor Holiday: Yeah, good amount of time. And what I love is that we have a short relationship, but the brand has a long one. So Duke Cannon has been around since 2011. And what I'm excited for in this episode, and this is why I love this series is to continue to give you all as listeners. A visibility into how many different paths there are to getting to building an awesome business. And Duke Canon has one that spans a lot longer than everyone may think. A lot of us think of the DTC era as maybe being five or six years old. And in reality, this is not a pure play DTC brand. It's a brand that has spanned a little bit different distribution methodology than many of the businesses we have spoken to before.

And I'm excited to sort of break down a trope that I hear right now in our industry, Chris, that has to do with. The sequence with which you go into broader distribution as an ecommerce business is you sort of build up your online business until that taps out. And then you go use that to find out what retailer you should go to.

And that can be a path, but you guys took a very different path and one of your strongest scores in your GQ score, which is right above one 30, a great solid score as well is the amount of distribution that you have. So tell us a little bit about the distribution story of Duke cannon and how that's helped to build and amplify the brand. 

[00:02:46] Chris Lutz: Yeah. I mean, the story of Duke Canon when it was originally founded was the brand was sort of designed for specialty and independent retail. And if you look at the way that our original sort of product lineup was designed, each product was sort of a novelty, sort of a standalone piece. And as we grew and evolved, we expanded into.

specialty retail more and, and went for some larger chains. And then, and then sort of at the same time that we made a play for FDM, we made a play for DTC and started building a DTC business in earnest. So we really kind of did it backwards from the way that a lot of brands build their, their businesses.

[00:03:29] Taylor Holiday: So for those people that don't know Chris, what is specialty retail? What does that specifically refer to? And can you give me some examples of where Duke Cannon found themselves and why those stores in particular were effective? 

[00:03:42] Chris Lutz: Yeah, I mean, we, we really, I think, started actually more in the independent space. So, you know, stores owned by families, small business owners, not chains, maybe, you know, one or just a few, a handful of locations selling at gift shows like the America's Martin Atlanta or the Las Vegas market. And really kind of trying to create a differentiated product that.

Felt you know, unique and positioned in a way that was. That sort of spoke to this, like, ideal of what it could be to have positive positive masculine virtue in America. And then we expanded into specialty, which is you know, it can be upscale grocery chains, but it could also be retailers like Lowe's as a specialty retailer.

So kind of a, an unexpected place to find products, like, you know, body wash and bar soap, but it worked really well for us for our brand. And I think it just resonated with our core customer.

[00:04:41] Taylor Holiday: really cool. If you haven't ever seen Duke Cannon's packaging, It is very obvious to me that it was built with retail and shelf space in mind way more than it was an ecommerce in mind. So there's cool like tins that I don't know if they, there's also packaging that looks almost like it was an ammo box and of course they have the legendary big ass brick of soap. Like it is a visually compelling product that I could see very obviously standing out alongside a dove clear plastic bottle, right? That's sort of the usual suspects or even the novelty of it. There's a lot of Americana feel to the design styling in a way that would very clearly appeal. It almost feels like a novelty gift that I would expect to give somebody. When I see it and so how much of that distribution informed product, like how much did those things relate to each other in the early days? 

[00:05:32] Chris Lutz: Well, I think in the early days, it was really about trying to create products that told a visual story that inspired dudes to pick them up when they were in these stores or, you know, women buying gifts for their husband or boyfriend or dad or whatever. The product sort of, I mean, there was an element to it that was meant to sort of almost be a joke, but the product.

Inside the packaging was so good that we developed this really loyal fan base because people would get these products as a gift and then they'd buy them again and again. And I think that that has evolved over time as we've made a play for, you know, bigger retailers. And I think now we're in a unique space where we continue to have strong relationships with our independent and specialty retailers, but we're also selling in, you know, food, drug, mass target, Walmart.

CVS and Walgreens and the product has a unique value prop and kind of, differentiated look and feel there as well, because it's really, as to your point, it's, it's designed to be different than other products on the shelf in the category.

[00:06:31] Taylor Holiday: Yeah. And that sort of great merchandising and product development then begins to set up and translate now into our world in the digital media ecommerce, where the product photography can do so much of the work. Cause it's almost like there's a story inherent in the photo already that like, you don't have to do a lot from an advertising standpoint to go and recreate a story.

Cause the product is itself a story. And that's such an interesting starting point for many brands versus like. It's a very boring blank package. And now I have to add has to do so much work around explaining what it is. Have you thought about that then as a marketer on an ecommerce platform, how does that all tie into how much effort or merchandising consideration you put into both the website and the advertising? 

[00:07:15] Chris Lutz: Well, I think that it, it, I mean, if I think about how I would describe our brand, I would say we're a story brand. So it, it, it makes the way that we show up in advertising different than what other brands in the category are kind of executing. You know, you see a lot of like fairly clean packaging, neutral looking, you know, men's grooming brands that are doing a lot of.

Direct response creative that calls out specific features and benefits kind of like what's in it for the customer, but it's a it's it's really it's about the product. It's about the formula. And I think for us, it's been more about, like, engaging with our customer through the humor of the brand. And how can we how can we make that?

How can we make that happen across all the channels where we play? We, you know, we're constantly trying to figure out ways to make our ad creative on Meta and TikTok feel authentic to the guys that are buying our product. And it is challenging. I mean, frankly, it is,

[00:08:11] Taylor Holiday: Yeah, no doubt about it. Tell me a little bit about the role that ecommerce plays in your direct channel plays inside of a business where and this is true for most CPG brands, that the bulk of the market is retail. Like the bulk of the market is happening at grocery at, you know, the drug and pharmacy spaces.

So what is,

the job of e com? In that business. And how do you think about that as the person in charge of it? 

[00:08:37] Chris Lutz: I would say there was a time during the pandemic when our DTC sales channel was considered more important as a driver of top line sales, because it was one of the places where we could actually distribute product at scale. But as we've kind of returned to a place of more sort of normalcy, we really view DTC as a sales channel.

That's about. Testing product and messaging to inform how we then make business cases to our key retail partners about what works and why. It's also a place for our most loyal customers to engage with our loyalty program and have access to a wider assortment of products than we have available in retail.

So, there is DTC sales channel that I think a lot of other men's CPG brands don't necessarily have. And it has a lot to do with the size of our assortment, which is very broad and the, you know, the type of community that we've curated with our Facebook Lodge and our email program and all the things that we do that are differentiated.

[00:09:45] Taylor Holiday: This is a trend that we have seen. Many brands go through the transition of where was sort of initially proposed as this channel that was going to be margin expansion, right? It was going to be wholesale has this margin and then online you get to keep it all. But then everybody sort of realized, well, that's not totally true because there's this thing called CAC that goes out to uncle Zach and the team over at Google that sort of really doesn't lead to a better margin.

Net outcome than maybe wholesale does. And so then the transition started to move towards power being around the things you're describing, which is the rapid understanding of messaging, as well as the ability to communicate and drive impact everywhere with your digital media, that it's not just about driving direct business as well as the ability. To understand and create unique product experiences for loyal customers and thinking about those relationships. And I've watched that evolution change, especially for businesses in your category. We work with a couple of brands inside the PNG empire, and they've really, I've watched them go through that similar evolution as they think about that direct channel. And, and even recently, one of the things that you guys have gone through, and this is where we had been a partner in this together. If we look at your first order value to CAC right now in your GQ score, we see that it's just about breakeven. But depending on the snapshot in time that we were to take that data, we'd see sort of two very different profiles of that metric in particular, where you were sort of, as you described, aggressively pursuing more of a top line growth to now we've shifted more towards profitability of new customer acquisition and thinking about the growth of this channel being contingent on a healthier set of economics. So talk a little bit about how. The, that has changed over time. The sort of imperative of new customer acquisition has shifted over the course of the last few years. 

[00:11:34] Chris Lutz: Yeah. I, you know, I think one thing that you said that it is insightful is the media that we're running on meta and tick tock and Google in support of DTC, you know, there is a halo effect for other sales channels. So we understand that. Those are investments that impact how we show up everywhere and the awareness that that our brand, you know, the brand awareness that we're generating as people sort of consider what to buy in the category.

But there was a time when we were investing, a much higher portion of our overall marketing budget into direct response, creative for our DTC sales channel. And you know, I think there was a time before, you know, changes to meta and the way that the way that the platform actually functions, where that actually worked more reasonably well for us than it, than it.

Then it did kind of, you know, coming out of the pandemic. So, you know, today, the way that we're thinking about it is, you know, we do, it's important for us to, to pursue top line growth and acquire customers aggressively, but we need to do it in a way that is that, that allows us to maintain a certain level of margin and contribution for the channel.

And that's really what we're working to do now.

[00:12:45] Taylor Holiday: Yeah, And that evolution has been consistent for everybody. I think for many of the brands in CPG space, I have this, I had a call this week with a customer called Navaj that sells like glorified nutty pot. Like it's a bet, like an evolved version of the nutty pot here that helps, you know, do it's probably underselling the impact of the product.

It's pretty cool. But, very similar to you guys in the sense that they have really broad scale distribution in retail. They do a lot of TV and radio. That's not necessarily share with you guys, but it's more of a traditional sort of business distribution. And so they're asking the question of, like, what our online business serve? think that there's this opportunity to think of as the mechanism to fuel your digital media and brand growth in a way that if you can get your marketing to break even of new customer acquisition or even like a small profit, the question is how much could we tell story doing that build the interaction with the brand that's going to have that halo effect everywhere, where more than a profit center, it's the engine for awareness growth at a way that doesn't.

It doesn't become deprecated to the margin. And I think that is more and more what I'm seeing people evolve this channel to is like, if we can get to break even first customer new customer acquisition, understand that there's a halo effect at every point of retail where we distribute how many awesome stories and cool pieces of content can we create to drive this overall brand engine as we go.

And I'm seeing more and more that that's sort of the evolution of how this channel is, is is coming to life.

[00:14:11] Chris Lutz: Yeah, I mean, I certainly view it in that way. We have, we've, we've played in different advertising channels in the last two years where the measurement tools don't really allow us to fully understand the impact of that media. You know, we've, we've run campaigns on linear TV in a pretty big way for us last year and CTV.

And we've done some out of home and some other things where it's really sort of hard to. Attribute revenue to those investments in a vacuum, and I'm not making the case that those things are necessarily bad or didn't work for our brand. I think, you know, we do have some some data points from 1 of our measurement partners that do help us to understand what the impact of those things could look like at a fairly generic, not very granular level, but You know, on the flip side running media where we can, you know, really look at attribution in a controlled way on on meta and on tick tock and on Google.

Those things do grow the brand across the board, but we can also, you know, drive revenue in a, in a way where we're. Actually generating a positive return on those investments and that's really that's really the aspiration or the goal. So, you mentioned this at the top of the call, but we're, we are now to a place where we're close to break even on 1st order.

Our goal this year is to focus on ways to increase AOV while continuing to, you know, meter or even drive down customer acquisition costs through better creative execution and then drive LTV so that over the longer term, we're generating more, more of a long tail of profitability from that acquisition effort.

[00:15:50] Taylor Holiday: One of the things I want to shift course a little bit is you and I have talked in a couple of our times out here about this idea of who is Duke Canon and who is this brand, this persona. And you mentioned this idea of sort of shifting the perception or narrative around masculinity and how products interact with that idea. a touchy subject in 2024 to try and enter into, how do you think about how to do that well? Like as somebody, you're, you're a creative at heart. You've got the data chops to Chris, but I know in seeing you in those conversations, you think about this a lot. You care about the brand and it matters to you.

So how do you think, how does Duke Canon approach thinking about creative and how they show up in men's lives? 

[00:16:32] Chris Lutz: I think that what we've always tried to do with all of our advertising efforts is to speak to the sort of virtues of. masculinity, the positive virtues of masculinity in a way that resonates with men. And so, you know, you can kind of see the way that that manifests itself in our the creative we're running on, on our digital channels, but also what we've done on TV and how we've shown up in print.

And I think about that a lot as I'm thinking about ways to diversify the creative in our In our, you know, paid social accounts because we used to run a lot of static creatives where we could kind of control the elements and create a certain perception. We, we have leaned a lot into kind of like things that have a vintage kind of.

Look and feel, but as we have gone down the sort of rabbit hole of working with more sort of content creator partners and people that make video content for us, it's become apparent that we really do want to kind of carve out a lane with that type of creative where we're showing like real authentic, hardworking men talking about product in the way that they would talk about it with their friends rather than talking about it like they were given a script or talking points from the brand.

That's really important for us. And you can see that in the performance too, just with the, you know, with the efforts we've made to run that type of creative, it's, it's really apparent when something was was executed without a lot of sort of manipulation from the brand versus when when it was more scripted.

And it's really important for me.

[00:18:06] Taylor Holiday: And that's, there's a tension here, right? And this is a thing I think we've sat in with you guys a lot that many brands face, which is what is the relationship between that open ended authenticity, where we allow. Anybody to say anything consistent with who they are and then the brand's sort of idea of itself and how those things evolve over time, how they're really brand is in the eye of the beholder, right?

Like I, I'm willing to bet that all of the users of Duke Canon don't have a homogenous idea of who they themselves are, let alone who the brand is and how do You allow them to express it uniquely while also having consistency. Those are challenging ideas when you deal with something as. Broad as masculinity that can have these variant angles on it. That you want to allow people to sort of declare authentically, but also want to keep it within a frame that allows it to mean something and not just nothing at all. Right.

[00:18:58] Chris Lutz: You know, I think like to that point, the, the sort of easy or lazy route to creating content for this category, which a lot of our competitors engage in is to sort of lean into this idea that if you use this product, you're going to attract attention from women or the opposite sex. We have always. Really focused on what's sort of in it for our guy, our, our core customer, which is, you know, we want to create products that work hard for him because he works hard that deliver performance and sort of a trade off experience, but without making a big deal about it, you know, like, I don't know a lot of.

Men that spend a lot of time talking about their complicated skincare routine, but I know that they appreciate it when they're buying a product and they feel like it works and they're not getting ripped off. And we just with everything we do, we try to capture that sort of sentiment.

[00:19:52] Taylor Holiday: Yeah.

I I've always found that problem solution is sort of the lowest hanging fruit of advertising often because people experience problems in an acute way. And so if you think about something like. You struggle to get attention from women. Here's a solution to that problem. That's like sort of a low bar and it can be impactful.

There's a place for it. But

to me the best marketing always sits at the identity level. When you allow me to declare something about who I am, and that resonates with and reinforces an image of myself that I want to have, that to me is always the most effective, right? So like, I'll give you an example.

This shirt that I'm wearing. Is from a brand called Cosm. Okay. And you've never heard of this brand, which is part of the intention and appeal for me is that I like to be a little contrarian. I like to find things that other people haven't. It's a men's yoga brand. Now I don't do yoga, so I don't necessarily identify with that part, but the, it is an attempt at creating a masculine angle on an activity that where men normally don't get speaking to spoken to. I love the fit and I get to tell people about this brand that I discovered. And so all of those things fit into a story I have about myself in a way that works. And one of the, one of the things I like about Duke cannon. So, and I'd be curious to what marketing his role is in this, but sense are a big part of any product category, right?

And you guys have a lot of fun names for sense. The one that I think I find most. Sort of compelling. It's sitting in this angle is the idea of naval diplomacy as a scent which, which to me is like, there's a level of sophistication to the translation of that into a sense that actually requires, like, it's an intellectual appeal in some ways to the idea that like. That's something I would care about enabled. It's a conversation I might have around the table in some way. So, so tell me a little bit about how you guys decide the scent names and where marketing's role is in that and how you think about the job that that has to do versus the UGC character that gets played.

Like how much do you participate in that and how do you guys collaborate on creating these things? 

[00:21:50] Chris Lutz: Well, the creative team that creates our sort of go to market marketing content also has its hands deeply intertwined in the product strategy, which, you know, is. It starts with the, the, the purpose of the product and then, and then the name and then sort of from there, it's the positioning of the, it's the positioning of the product and the fragrance.

And like, what's the story we're trying to tell. And I think that that's been I mean, you know, if, if we're, if we're getting really fundamental here, the ad creative In service to the legwork that was done during the product development process. Like, I think what we are, what we are not doing is creating a generic sort of nondescript product offering.

I think what we are really striving to do is make a compelling sort of, I mean, I think you're right. And using the word sort of like intellectual product offering that is there's there's a level of. Yeah. Of sort of thought input that goes into how we, how we make products, what we say about them, what the purpose is.

And it has to be rooted in this. It has to be rooted in some reality of people sort of. Lived experience of, of like what it means to be a man in the United States. Right. Like, we just launched three new scent profiles in a couple of different products and there was a lot of effort put into really thinking about like, what, what can we evoke with the names of these products?

So we have superior way finder and high country and each one kind of has its own. Story that started with some frame of reference, like superiors, Great Lakes, Lake Superior, kind of like what that means and what that feels like what that experience is like. But coming back to naval diplomacy. I mean, I think that 1 is like, it speaks to, you know, this kind of idea of, like, what it means to have, like, sort of strong American patriotic values.

And like, how do you, how can you express that in an authentic way through a product?

[00:23:54] Taylor Holiday: Yeah. And what I, what I love, what I find compelling about Duke Canada is that I like, you find a lot of. masculine objects to be sort of this like lowbrow attempt at the most brutish version of myself, right? It's muscles and women and base human desire. And I think there's this like other sense by which, and I think this is like, if I look out at the underlying trend of masculinity in 2024, what I see, or like, and this is obviously from my point of view in the world that I occupy, but is that the aspirational identity for men is moving into these categories of the like.

The Andrew Huberman of the world, which is this, like, he's really fit, but he's an intellectual on a podcast in a way that we see our, it's like this elevated sense of self that like, I can be both intelligent. and strong, you know, like that these things aren't

odds with one another in some way. And it feels like that is a little bit of what's going on where there's this, like, there is this return to this appeal of strength in men, I think in a way, but also it comes with paired with an intellectual capacity to be thoughtful and a thinker and independent minded.

And these other attributes that seem to be culturally in the zeitgeist right now.

[00:25:04] Chris Lutz: I, I totally agree with that. I follow a lot of people like that on my own personal socials. And I think that if you look at what we've done as a brand, we've always kind of done that even before. I think, I think we sort of were on the emerging end of that. I mean, one of the things that I really point to that speaks to that specifically is we have this Friday editorial email that we do every week.

It's a long format email, our creative, our creative director writes it. It's on a specific topic and it's sort of like a, You know, it's an exploration of a theme that is relevant to men based on cultural references or shared experiences. You know, like we did one about snow removal and like the different things you can use like shovel, brush, broom.

You can just not shovel at all and keep driving over it. And I think like it taps into this like You know, shared experience that people have around these things in our everyday lives that are not related to product at all. But I think that it works.

[00:26:07] Taylor Holiday: Yeah, I think there's this One of the trends that I'm following and interacting with closely is the explosion of golf right now. It's having this like crazy cultural moment. And I think it does this thing for men, which is both it's a shared experience where you can go out and you can have a beer and you can. You know, talk a little shit and have fun, but it's also like, again, it's like this is a country club sport. This is like elevated, you know, it's this sense that I've matured into this in a way that it's not, you know, the same as maybe playing spike ball on the beach or whatever. Like, there's just, there's a sense by which it has with it. An elevated sense of self too, that I think really does fit nicely for, for men and provides a lot of those things and not exclusively to men, obviously, but just in terms of that experience. And this is partially me reflecting on coming back from the DTC golf tournament this weekend that I was at. And we're just watching, like there is a unique sense of camaraderie that got developed over the course of these three days amongst this group of people. And it was this combination of I have a friend that. runs. just started two sentences. I do this. Sometimes my brother critiques me and my podcast for this. So I'm going to slow down and tie this idea together. I have a friend that runs a company called I heart dogs. Okay. Giant media property. They sell a lot of pet products, brilliant market. And he says the way they think about going after any audience is that a lot of times people think about a single enthusiast audience. So they say, I want to find people who love dogs. And we say, no, no, no. The best. Camaraderie is at the overlap of two enthusiasts audience. So they go like dogs and the military and they create products in the center of that or dogs and wine lovers. And they create things at the center of that. And when you overlap these two enthusiast audiences, the relational equity that you get with those people is deeper than anything else. And so my experience with the golf thing is ecommerce and golf at the overlap of that shared experience for a group of people that gathered together was like.

Immediate camaraderie, we didn't just have the business thing in common. We had business and golf and suddenly we were deeply connected to one another, you know, and so I think for, for a Duke cannon or any brand that's trying to speak to an audience, the temptation is to just go, Oh, single category, the military, right?

But I think it's at the overlap of these dual. Passions that you really find like a next level of connection. That's really interesting to explore.

[00:28:22] Chris Lutz: Yeah, I agree. And that's why, you know, we've, we haven't, we've, we've been, we've made a conscious effort not to go all in on any one thing.

[00:28:31] Taylor Holiday: So as you think about one of the things that going back to GQ score, and if I were to say, point out an area of improvement here, and this is probably also reflective of selling to men, generally, generally speaking, man, as a consumer, slightly less Loyal and drive less LTV than women. Part of that's just a consumption pattern thing, but so are LTV not quite to 100 percent in a year, closer to around 50 to 70%, depending on the cohort that we look at, how do you, as the person responsible for e comm and loyalty and community, think about that number and what are the mechanisms by which you can help to improve it over time?

[00:29:08] Chris Lutz: Well, I, I think that it's the onus is really on me to improve it over time. I think there are certain realities baked into the type of products that we sell that dictate to some degree what our LTV looks like over time. I mean, the reality of our product Offering is that we have we do have products that that live within a higher frequency of consumption category, but we make products that exist on the sort of peripheral of like how of how long a product in this category would last.

Our bar soaps are literally 10 ounces. They're like the size of a brick. So 4 pack, that's like 8 to 12 months worth of product. And so what I think about as, as we think about how to really build LTV and hone in on our retention strategy is how do we build the regimen if we know that we're bringing the majority of our customers in on bar soap and body wash, which is true, but we also at the same time know that the LTV of customers that are buying periphery categories like cologne and hair care is significantly higher.

How can we build the regimen and cross sell into those categories more effectively? So that's really what I'm working on this year. And we're making a couple of strategic hires to really kind of focus on that as a, as a discipline.

[00:30:29] Taylor Holiday: Yeah, this is such an interesting consideration. which is the relationship between bundling a large supply of product and the immediate cash value that that offers versus something with a higher consumption rate that leads to maybe more frequent repeat purchases and the merit and benefit of both patterns of behavior. And you guys do a lot of bundling, right? So

[00:30:51] Chris Lutz: We do.

[00:30:52] Taylor Holiday: is there, is there a consideration for short term needs of the business from a cash standpoint or profitability standpoint, relative to whether you bundle or try and think about more of subscription or single skew or lower or sampling kits. Like how do you think about when to use each lever and which are generally more successful for you all?

[00:31:12] Chris Lutz: Well, really, wherever possible, we try to sell new customers into bundles or multi packs. It makes sense for them from a value perspective as new customers, because the pricing is better when you, when you buy multiple products, but it makes sense for us because obviously our goal is to drive AOV so that we can have a right sized CAC to LTV ratio.

I think that what I will say is there was a time 2 or 3 years ago when our free shipping threshold was low and our shipping rate was low and we had our bundle price, our bundles priced very aggressively. And so we drove a lot of top line. But, but we, we, it was, it was deeply unprofitable. And we've, you know, we've sort of ratcheted up our the price of our bundles so that they are they make more sense for us from a business perspective.

We've adjusted our shipping threshold. It is, I mean, when you're selling products at the price point that we're selling products at, you have to sell 4 to 5 units per transaction to get to that 50 AOV, which is sort of our target. So, part of it is asking customers. Who are sort of part of this cohort we call the mainstream upgrader that are they're not buying premium products.

They're they're upgrading from mass products. So we're asking them to spend 50 on product. And for a lot of people, that's just that is a bigger ask.

[00:32:37] Taylor Holiday: Yeah, it's, it's, one of the things that I find in brands that have a lot of skews or a lot of ways to. their products is it's both this gift and a curse, right? Where it's sort of like there's an endless set of possibilities. You're constantly forking your data by creating all these new skews.

It makes things more complicated to track, but it also allows you to communicate. In different ways all the time, like it affords you that in, in different ways. And so I think there's definitely a tension in trying to figure out what is this sort of lead core hero skew here that drive can drive the greatest impact versus trying to figure out ways to merchandise the product to meet the season or the moment in different ways to leverage the uniqueness.

The size component is this unique factor for you guys too, where you are selling usually bigger supply of things in a way that's different than most. Have you guys ever played with or ever done? Like a sort of direct alternative to the big aspect of soap, which is like the mini bars of soap as a sampling kit or anything like that.

[00:33:33] Chris Lutz: We do have a couple of half size bars, but we've never made an effort to make, like, a sample set that would have, you know, a handful of products. And I think a lot of that has to do with just the feasibility of Developing products specifically for 1 channel, which would be DTC in this case, when we're really, you know, if you, if you look at our channel mix, the, the primary consideration for us really is food, drug, mass, and like those larger customers.

[00:34:03] Taylor Holiday: I think something like that on an ecommerce standpoint, like I can imagine there's imagine like a Rubik's cube, but it's all like the flavors of soap. And so they're like little nut, like a one by one, a little squares that gave you a sample kit. And you could Make it like in a Rubik's cube. I feel like that's very Americana for you guys.

But like, one of the things that I think can be an unlock is this idea of some way to enter into a sample that leads to a quick, frequent repurchase that gives customers an opportunity. What I've found is that often you can get that first CAC to basically break even, but you just get a much more frequent faster secondary purchase off the full size. Those kinds of things tend to be fun ways that you can explore it. But Yes. That's super interesting that all the different ways that you guys do present and merchandise the product. How do you think about that on the website homepage? Like what drives your decision about what goes where? 

[00:34:52] Chris Lutz: Well, we have we. As we develop our promotion calendar, a lot of sort of our, how we think about like the above the fold content is driven by what's new, or if there's some specific sale or offer we are, we try to be a fairly non promotional brand. So, we, you know, we have a couple of annual sales but, you know, we really try to focus more on bringing people in on the right core products.

And I think if you look at. You know, which products are kind of consistently in the top. It's, it's, it's fairly formulaic, you know, we have a couple of core bundles that always kind of. Do a lot of the heavy lifting for us and then we sort of fill in around that with new products that we're launching at any given time, but we don't try to proliferate a ton of skews just because you know, we see what really does work and, um, it just, it, you know, to your point about, like, having a lot of products to sell, it gets complicated.

One thing that we have done though, over the last year that has been really successful is rather than just focusing on evergreen top selling products with ad creative, we're really, we're creating new customer offers and then driving to specific dedicated landing pages where there are, you know, unique combinations of products or a unique.

offer on a build a box that is only available to new customers. And then we're making sure we have great ad to landing page cohesion so that you click through from the ad and it's really clear what you're buying. There's some, you know, social proof testimonials. And it's a, it's, it really helps to drive, like, you know, it, it helps to drive those easier conversions specifically for, you know, new customer prospecting.

[00:36:33] Taylor Holiday: love it. So Chris, one of the questions I'm going to start asking as part of these episodes, I've been thinking about how we can make them as useful as possible is. Each episode sort of represents a different category of product to explore. And undoubtedly there's somebody listening who's in a men's CPG personal care category. And I'd be curious if you think back to the early days or if you think back to imagine being inside of a one to 5 million brand in that space. What would you say to an entrepreneur or founder in that one to 5 million men's? personal care category to help them with that next phase of journey. What should they be going after or thinking about that you think would be the most impactful lever for them?

[00:37:16] Chris Lutz: I think that my experience at Duke Cannon and also at some of the other companies that I've worked for, you know, has really illustrated for me, the importance of understanding why your brand exists and how the product fits into that story. I think there are sort of a dime a dozen DTC brands popping up all the time where it's a novel product.

There's usually like 1 or 2 items in the catalog and they sort of go viral and then. A lot of copycat brands come along that kind of make the same thing. There's not a lot of story around the brand and why it exists and what the purpose is. And so they sort of fizzle out. And I think what's really differentiated Duke Canon and allowed us to expand beyond the original sort of distribution channels we played in is like, it's always been really clear who we are and what we stand for.

And I think that that is a consideration that comes way before the product. That's. That's a foundational sort of reason for being that I think you need to have as a brand, particularly today, where, you know, anybody can start a Shopify store in 10 minutes.

[00:38:24] Taylor Holiday: It's so important to like, assume your success will be at every marginal point possible by competition. is to accept the reality of the market that we live in. And to think about what is, we used to call it at Kalo, building our moat, what is our brand moat? And as we looked across it, we would look and go, okay, manufacturing, do we have a manufacturing moat?

Nope. That's the smart, anybody in the world could get one of these things made in a way that was incredibly simple. Okay. Do we have a moat in distribution? Well, if we can get first to some of these retailers, potentially we could create a moat there. Okay. That's something to think about for sure. brand was the place that we always came back to and said, if people a choice between seven rings and we fundamentally don't really have a product difference in reality, that doesn't, our ring doesn't fundamentally alter somebody a better experience.

Really. We could argue about quality, but it's going to be such a marginal difference in their head. difference is. ring has to say something about who they are. The brand has to matter to them in some way to create a continued choice of us over every other option as those options continue to grow over time. And so I

That's a great, great, great piece of feedback. Well, we appreciate you, man. Duke Cannon Supply Co. Go check them out. As always, click on an ad first, people. Come on, do me a favor. Go get a, go check out some of the awesome stuff that they have coming up. Chris, is there anywhere people can follow you?

You active on any of the major socials?

[00:39:52] Chris Lutz: You can follow me on LinkedIn. I don't, I'm not, I'm not posting on the regular, but I engage with lots of content with people in the space, including yourself. So I'd love to connect with anybody that is interested in 

[00:40:05] Taylor Holiday: If you're in the space, send him a message. Like pull on this dude's got a ton of wisdom. He knows a lot about the product category. He's kind and generous with his time. And he would love to help you to send him a message on LinkedIn. I'm sure he would be down to chat. And I don't mean you people trying to sell him offshore resourcing.

I mean, if you're in the founder in the space and you want to learn about it, but Chris, thanks for joining man. Duke Cannon Supply Co GQ score one 30. Great to see you all again. Another episode.