Why Product Development is the Future of Ecommerce Growth

[00:00:00] Richard Gaffin: Hey folks, welcome to the Ecommerce Playbook Podcast. I'm your host, Richard Gaffin, Director of Digital Product Strategy here at Common Thread Collective. And I'm joined today a mere two days later after the last record, just to be straightforward by Mr. Taylor Holiday, our CEO here at Common Thread. Taylor what's going on, man?

[00:00:18] Taylor Holiday: You know, um, thinking about all the people in LA dealing with the fires right now, we're in California. It's crazy windy. It's always a little bit weird when these things happen. So hopefully a lot of our friends up there in the LA area are safe. And yeah, just thinking about it and then excited to pick up on this conversation, because I think. We hit a vein a little bit for some people. We got some good feedback as it relates to what we're talking about and the theme that we're going to sort of keep leaning into in the early part of this year about marketing and storytelling and how that relates to financial planning and process. So excited to keep going through that today.

[00:00:49] Richard Gaffin: Yeah. No. And so am I. I mean, this is, I think part of it is that this is one of the most interesting, enjoyable, like life giving things you can do as a CEO or as a brand leader is think about the story that you're telling. And so what we wanted to dive in, we wanted to kind of expand on the conversation.

As you're saying, we had a lot of feedback and a lot of it was like, Oh, how, how, how do you do this? Cause this is one of the most difficult things to do, I think. And so one kind of way that we were just talking about to approach it is through, I'm going to refer back to our 25 things or your 25 predictions for 2025, which is a episode we did end of December and item number 24 was product development is the new head of growth.

And so. Let's I think what we want to do today is in answering that question of how do you do this? We want to start from the perspective of product development as maybe the way that this all begins. So let's let's kind of dive into that a little bit. Taylor.

[00:01:41] Taylor Holiday: Yeah, I think, I think we need to really anchor ourselves that the industry we're talking about is we're selling consumer product. At the end of the day, what you are trying to build through marketing or storytelling is demand for an object. And starting that process through thinking about the object itself as the thing that creates the story.

I think is, is probably the most effective way to do this. Now I get it in some cases, maybe you're, again, we talked yesterday about how that may not always be possible. You might be a single CU brand, something like AG one. And so maybe that's not relevant to you, but I still want to talk about this principle, this idea that. Product development is the head of growth. That this is where business growth comes from in consumer product and e com.

And I want to give you an example of a story today that I think illustrates the point that I'm making really well. And I, I sort of stumbled onto this accidentally, which is sort of illustrative of exactly how you want your stories to spread is that I was at Christmas with sister and brother in law have three kids.

They're close to the same age as my kids. They're all really close. Their oldest is a baseball player. And I was walking into their living room and I saw a stocking hanging from their mantle. And the, the, the stocking was in the shape of a. Baseball sliding mitt. If you don't know what that is, this has become a big trend because a few, a few top tier Major League Baseball players, notably like Trey Turner, like broke their, tore their ligaments in their thumb, sliding headfirst into second base. And so it became common to wear what is referred to as a sliding mitt, which is just think of it as a fingerless glove that protects you from catching your thumb when you dive headfirst. So, That got quickly turned into an accessory for kids that became very popular and cool to wear because the big leaguers were doing it and the brand that was is one of the brands that's at the center of that is a company called Absolutely Ridiculous, also referred to as Aria that's become really popular in the youth baseball arena and hanging from Their mantle was a sliding mitt in the shape of a stocking. And I just, I had this moment there where it, this idea that we're trying to get to this idea that growth and efficacy in your ad account is connected to a thoughtful planning exercise that connects product story and moment was just so perfectly encapsulated in that object. And then I want to talk a little bit more about today, how they did that.

Spilled that over into a broader collection, how that drives demand. But, but that right there, I think is the lane we want to walk through that we want to use for you all to illustrate. Here's an example of what I mean, where product and story meet a moment to create demand that drives disproportionate efficacy in your ad account.

[00:04:23] Richard Gaffin: So actually one question real quick in youth baseball, are you allowed to slide head first now or did they just 

[00:04:28] Taylor Holiday: No, no. In many cases, you aren't now. In travel ball or pony baseball, you can't little league. You can't. So it is primary, like, look, and these kids aren't moving fast enough to tear their ligaments in their thumbs. Like this is pure accessory

here, but but, but youth baseball players are just like notorious for having endless amounts of free, free spending money, apparently on for accessories.

[00:04:54] Richard Gaffin: Yeah. All right, cool. So yeah, I think then let's just kind of like dive into this a little bit. So I think like maybe to unpack a little bit more about the ARIA example, which I think is so great. It's obviously like the, you can see how the thought process that led to this story, which is like the sliding mitt.

Already kind of looks like, I mean, it's a mitten, right? So it kind of already looks like sort of a winter accessory. And it's, it's very obvious that if you flip it over, so these mitts have a little hanger, so you can hang it on the mantelpiece and you can actually use it as a stocking. So the way that the product design itself translates then into the story around the holiday, around the gifting season, kind of makes sense.

But maybe let's unpack a little more of what it looks like to come up with that story. Maybe bring some other examples into it.

[00:05:36] Taylor Holiday: Okay. So let's imagine you're going into the Christmas gifting season, which is

one of your biggest moments of the year. A lot of the conversation sits around offer design. Everyone wants to know, like,

what promo should I run? Should I do 20 percent off? Should I do a gift with purchase? Should I do, you know, this plus that equals this like bundle. And all of that is just nonsense. Like, like it's important. Don't get me wrong, but it is not the thing that creates an abnormal return.

You don't break the model that way. You don't go out and grow in a way that is unique and differentiated by saying, I'm going to do 25%. They're going to do 20. I'm going to do gift plus, no, no, no. This is how you do it. So absolutely ridiculous. What they did is they said months in advance in order to, to accomplish this. This is why marketing calendaring and future planning is the sustenance of growth because it requires thoughtfulness that has to exist months in advance. They went, all right, how could our product uniquely show up in this cultural moment of Christmas? What could be true about our brand? Now, most people, what they would do is they go, Oh, we're, we're a baseball brand. That doesn't really have anything to do with Christmas baseball seasons, actually in the spring. So I don't know, like we couldn't really fit in this moment, but no, no, no, not that what they did instead was like, to your point, Richard, we have an object that seems to, or could potentially fit within the context of a moment that a, there's And if you think about it, like there's nothing less boring for a 10 year old boy than like a knit wool stocking,

but you know, it looks really fricking awesome is a baseball mitt hanging from the mantle and we'll drop the link so you can go check these out.

But here's what I want you to understand. These sold out in less than five minutes. This is what my, my sister in law, when she took, she tried, she bought one. They had three styles. They had a gingerbread man, a Grinch one, and they're sort of, ice cream style that the baseball lifestyle guys popularized.

They become really popular, popular in baseball. They sold out in five minutes. Okay. This wasn't actually about making a bunch of money. This was about scarcity, limited edition, exciting, and interesting. And then when you go and you look across the rest of their site, it's still live now, if you go to absolutely ridiculous.

com, you're going to see that their core product lines, which are an elbow guard, a sliding mitt and a shin guard, you're going to see a collection of their core product line in those styles. Grinch, gingerbread man and icicle or whatever the, the other Christmas styling is that was there as additional category expansion beyond just the newsworthy PR story of a stocking.

Cause obviously they're not there to sell stockings. The stocking, the product is a marketing effort. It's something that makes drives clicks. It gets attention. It gets stories. It gets PR gets influencers talking. You sample them to a bunch of cool people. They show them off. People post them on Instagram. That's what they do. They create a flywheel of attention. Then you have this product line that is scarce and also limited and meets the moment of your core product. So now your core product exists in these cool styles to get the kids. It's like, Oh, I have a black one, but now I need a Grinch one that I'm going to wear two weeks of the year. And all of this, I want you to understand all of it is actually about selling black shin guards in the spring, so it's about, but what That creative drives disproportionate CTRs disproportionate, cheaper CPCs. It gets shared more. It drives more demand. It drives more attention and the business grows in credibility, coolness, authenticity, and story. That's what happens. And it all happens, not because someone came up with a new hook to a new image or a UGC or whatever. It actually, the form factor of the ad creative probably actually wouldn't matter. They would all work. Because the story is so good. It meets kids where they're at in a moment that overlaps perfectly with the cultural narrative surrounding Christmas and gifting cool product to a specific audience in a way that uniquely understands them.

[00:09:46] Richard Gaffin: So actually, let's, let's dive in then. Cause I think it's, it really helps illustrate this. The, the two J's example that you were talking about before we hit record here. Because that's, cause the one question you might have is like, obviously the holiday moment is very specific. That's a calendar moment for everybody.

And then, and then the translation of the sliding mitt into a stocking is sort of. Kind of more straightforward, maybe. So talk about this brand two J's and kind of what they've done to meet a moment essentially.

[00:10:09] Taylor Holiday: Right. So the Christmas is sort of, again, people would call it an obvious one, even though I don't see many people

sort of behaving in this way, but 2Js is a men's jewelry brand. They also have clothing and accessories and stuff, but primarily they sell like men's jewelry and accessories. And they did, they they've sort of become famous for trying to create these viral moments.

They've done things like they rented a pirate ship once and had a bunch of influencers show up on it and create a bunch of content. And so they do a good job of getting attention. Even go look at their black Friday ads. They're like, they're actually really cool. Like, they have this big banner that says no black Friday sale this year.

And then a truck like drives through it and is like, of course we're doing a black Friday sale. And it's like,

So they just get it. They get attention. Okay. But they did a brilliant thing that I think fits again with this idea of using product development to think about how your objects fit within the world.

That is like one of my favorite sort of examples of this. So, El Classico, which is one of the biggest soccer matches in the world between FC Barcelona and Real Madrid. That happens every twice a year when they play in as part of La Liga is a massive sporting event. Okay. Every year that giant amounts of attention are placed onto. Well, in that game, one of the best players for FC Barcelona is a young man who's, I think he's 16 or 17 years old named Yamin Lamal. Okay. And he's like the future of soccer, the next big thing. And he's so young, he actually wears braces. Like he still has braces and not like, because he's an adult and trying to fix his teeth because he's 16 years old.

And that's generally the time you might as a normal human developing get braces. So what two J's did is they actually created. Custom brackets for his braces for the game. So to go in and create, they created like these on his for his braces. So he could look cool for El Classico in a way that is just so brilliant for a men's jewelry business to think about braces as a place that their brand would show up uniquely. And of course, this got PR everywhere. It got tons of attention. They obviously did some endorsement with Cause they had IgE posts out of them, teasing it and posting it. And then, you know, once they did, they do it to sell the other jewelry. And so they use it as a tension. And I promise you that surrounding halo of story about the braces is what drives the click through rate is what drives the ROAS.

It drives the organic demand for the business. It's. Growth through product and story, not through rent. They didn't just look at their existing product line and go, okay, how could I move the font around or how could I get some other things and all this stuff? No, no, no. They're going to tell stories that interest people that drive attention and awareness for their business as a whole.

[00:13:00] Richard Gaffin: So one thing that I think connects both of these examples, that's interesting is that like, so this isn't really in both of these cases, this isn't really product development in the sense of like expanding your product line or something like that. It's actually more. Telling your story by showing up in the real world in some form.

Right? So again, the stock, this sliding mit stockings, that's not really going to be ever be the main product, but it brings people into the narrative. Similarly, the sort of the braces things, two J's again, obviously that's not for sale specifically, but it brings them into the conversation. It brings that into the conversation about all of their other products.

So I think it's like, maybe a way to think about this is that. The story that you tell has to be downstream from a way that you show up in the real world rather than the other way around, which I feel like a lot of the time it's like, let's come up with the email template or whatever, the way that the photo photography and the creative looks.

And then we'll sort of not, we'll not actually make any changes in terms of like what we're doing on a day to day basis. Like who we're talking to, like in person, what we're creating and, and distributing, whatever. So anyway, that, that was just something that, that kind of came to mind that this is about, about showing up in the real world in a certain way.

Does that, does that make sense?

[00:14:11] Taylor Holiday: That's right, because I think we have to understand that sometimes our job is to insert ourselves into stories that already exist, like we

in a way that is about what's happening in the real world. It's about this question of like, what actually matters. And The reality is, is that all of our sort of standard promotional email story, like nobody gives a shit, like maybe they'll click on it and buy it if they want it, if they're in market in demand for it, but it's not a story that's going to get spread, right?

That's really what you're trying to think about is, is what's a story worth telling. Like it's not even just what's a story, but what's a story worth sharing with people. The way I found out about the two J's thing was because on Instagram, some B2B marketing person, I forget his name. I should probably give him credit.

Let me pause real fast. So I'll actually give him credit. A guy by the name of Brian Blum. Who creates kind of the short form, you know, marketing style content that you'd expect did a story about it. Why? Because it's a story we're sharing. So I learned about it because it was worth telling.

And that's really the key here is I guarantee you a bunch of consumers found out about.

The brand that way too. So it does, it has to overlap and whether you manufacture a reality, like buying a pirate ship and having people sail on it, or you tap into the El Classico, I think the point is just, you have to ask yourself, is the thing I'm saying out into the world? Interesting. Is it worth telling? And that's all, that's all great stories are they they're worth sharing. And so that's the, I think the thing that we're going to keep getting at this year is what is the story you're telling? Is it worth sharing

[00:15:44] Richard Gaffin: Yeah. And I suppose like a good counterexample of a story worth sharing. That's not necessarily tied specifically to a physical product. Although it does tie very closely to the product that's generally sold would be the one I think about all the time, which is cars against humanities, 2017 black Friday sale where they raised prices 5.

It was just like, it was, it fits so perfectly with people's sort of understanding what the product is and their point of view. But then of course, like the idea of, Jacking prices up over the black Friday season is just, I mean, it's obviously, it's really funny, but also ended up being newsworthy. And so there's a way that you can like, yeah, it's about taking the product and what it does, and then tying it into something, some cultural moment that sort of spreads allows that message to kind of spread widely, 

[00:16:34] Taylor Holiday: I think about all the ways in which there's this whole culture and sports is like sort of an obvious way. Cause athletes look to express themselves in unique ways. I was watching a video the other day, Jamar Chase got sent these Nike Bengal cleats that were like for that. Like they were like in literally cleats covered in Bengal looking for, and he couldn't wear them in the game. They're not going to sell them. But there was an Instagram video that I watched about it, where he was talking about how cool they are. That that's somebody inside of Nike. Sort of doing this thing, right. Or I watched another, my son and I sat and watched a five minute video of a guy who made custom Nike airs for Mookie bets on opening day last year and how he handcrafted them and cut them and put them together, showed them being given to Mookie and, and shared.

And again, like, All of it is, is that this brand is at the center of really cool stories. And I want to be a part of those kinds of stories. And I want to be a part of your brand. And you've got to just find your way into those kinds of things. And it doesn't have to be like, I get it. Let me name all one of the most famous athletes in the world, but absolutely ridiculous.

What we're talking about is not. Celebrity endorsement here. It's clever product design and storytelling that understands who your customer is. That's the other thing. It really deeply understands the community and what they care about and how you could help them have a cool Christmas. You

know, like it really puts them at the center of being a hero in their story.

[00:17:56] Richard Gaffin: Yeah. So one of the the sort of messages that we got that we were referring to earlier in, in the pod was somebody, one of our clients actually asking us all caps, how Taylor, how do we do this? And I think that's, I was ruminating on this question this morning, because it seems to me that like, Even, even relative to, I don't know, cutting your costs and getting your forecast together.

This is actually sort of much more difficult or at least feels that way to me. Because the answer to how do you do this? It's not so straightforward because it's a lot of it is about instinct and you're just like, how good are you at understanding what people want and that kind of thing. But what are like, what are some starting points maybe for thinking about this conversation?

[00:18:35] Taylor Holiday: Yeah, you're getting it. What is the truth here, which is this

is about taste which is this phrase

that boggles my mind because I'm not, I don't consider myself someone that has like great fashion taste or trend taste. But I recognize that it's a gift that people have the ability to understand intuitively where demand lies.

Now there are spaces that I think I have the best chance at it and it's amongst people whom I uniquely understand their wants and desires. Youth baseball players is an example of this. It's one of them where I think I have a sense of what they want and how to make them interact with it in a certain way.

And 

[00:19:12] Richard Gaffin: Yeah, 

[00:19:14] Taylor Holiday: the, my point is just that it begins with a very unique understanding of the person, the customer you're serving and what makes them feel good in their reality. In their world. It goes back to that idea. The classic example I've used before in this is first media selling a crockpot, right?

And making an ad for a crockpot and saying, okay, who is the customer of a crockpot? Well, it's a woman who's entertaining in her home. That's who I'm serving. Now, in light of that, how would I create content to make that person a hero in their world? And that led them to creating these videos about how to use your Crock Pot in really unique ways that would make people go, Oh, that's really fricking cool.

You're smart. So that what a woman could do, or whoever's using the Crock Pot could do is to say, all right. And next time I'm going to actually make hot dogs in a crock pot in a way that, or turn it into a fondue machine in whatever, or like whatever the examples are that they use so that when people come into your home, they go, you're so clever.

That's like really thoughtful. What a unique way to use a crock pot that makes that person a hero. And so it understanding uniquely, okay. Who is this customer that I'm serving? What do they want to express about themselves? How could I help them to do that? How could being a part of the thing that I'm building, reinforce the identity that they want for themselves.

And so in many cases, I think brands have too wide of a view of who they

think they're serving. And therefore there are unique. Trait, not any uniquely identifiable traits amongst the audience that's that broad and wide. They're too, it's too diverse a group of people that you're trying to serve. And so you can't hone in on this well enough.

[00:20:53] Richard Gaffin: yeah, I think, okay, so that's, that's really good because like this, the beginning of all this sort of is almost like research, I guess, like, so you're pointing out understanding your core customers. So, like, maybe a place to start is asking yourself. Am I actually the core customer of this, which could be the case in which case then you just sort of have to, it's a practice of self observation.

Like when I'm purchasing something, when I'm buying maybe from one of our competitors or see what our competitors are doing, what are the things that really like, Attract me when I purchase something. Why am I purchasing it that type of thing? And then if you're not Just making a point of asking people who are you know what?

I mean, it's like I think a lot of the time or I found even when I was on the creative side It's like I want to put it on myself to come up with the the With the narrative here to understand what this person wants when actually all I had to do was sit down and talk to like, honestly, it's not even a survey.

You can talk like 5 people who fit in the demographic anecdotally get an understand of like, what understanding what their concerns are and then sort of spin it out from there. I 

[00:21:51] Taylor Holiday: And I actually think there's probably even more powerful ways to, to begin to go after this. Like at mass data scale, where you think about what you're describing of survey, like I think about if I, like, no commerce, I love Jeremiah, and he and I will, Are you tell her blue in the face about the importance of his product?

I think it is 0 percent to do with attribution. That's a really poor use of it. But this

kind of research is really useful. It's to start to ask people qualifying questions about what, what it is that they're they proclaim to be motivating them

related to what they, They like or dislike or want out of your product. I think there's lots of information there to be gathered and sorted through at mass scale, where you could produce a bunch of survey questions. You could use AI to translate it and extrapolate some of these insights and understanding. I think you could do the same thing with market level research. I think there, there's going to be an a resurgence. Of the idea of market research that AI enables at really big scale. And I think we're going to see providers show up that are

offering these kinds of insights. The other thing is like social qualification around sentiment. Like I think being able to say, okay, what kind of content does my my demographic of customer consume and share.

And so to start to then identify. What are they trying to say about themselves and how could I give them fuel for that story?

I think is a really important thing to consider.

[00:23:06] Richard Gaffin: Yeah, no, no. Yeah, and I'm not saying that that's not worthwhile. But I think that, like, there's like the challenge is moving from the data to like. a real understanding of what it feels like to be that person. And I think that's where like a lot of the creative insight comes in. Like, can you take all those data points at scale and then develop a picture of like, of a specific person and then what it would feel like to be that person.

I think that's kind of like where the ability, like people with that ability are the people are going to succeed at this, I guess is kind of what I'm saying.

[00:23:35] Taylor Holiday: Yeah, I agree. And, and, and I think this is why generally speaking, you see a lot of entrepreneurs who are serving themselves in that, like they're, they're, they're uniquely in touch with that sense

of the community tend to be really successful at this and great product. People usually live somewhere in that arena.

I go back to thinking about Alan Doan and the Missouri quilt. Company about how you know, like how intimately connected to that community. They are such that serving them is intuitive. It becomes part of an expression of themselves in a way. So I think that is often the best case. And when you get far from that.

It actually becomes really hard. And so I think you have to either recommit to deepening yourself amongst the community of customers that you serve for the sake of learning who they are and what motivates them. And the brands that I see struggling the most is often when they get to a scale. That they've sort of become too generic across serving too big of an audience and they've lost the UVP, the unique value proposition to a subset of people. And they need to sort of recommit to segmented specificity versus broad generality.

[00:24:43] Richard Gaffin: Yeah. That makes sense. So I think. Yeah, I get this, but like, if we'll, I think we should continue to have this conversation. It's particularly around like, I know that the question of how is sort of difficult, but I think that there's some maybe beginning tactics we can put in place to help everybody who's listening, whatever, think about this, this particular topic, because it's so, it's so difficult, but it's so important.

But 

[00:25:05] Taylor Holiday: think, I think, so one of the ways I think like, we all have like these really big media budgets. Like one of the things that I'm after in my head. Is everyone wants to think about the strategy for their media development is channel diversification is like, how could I add more budget to app love? And how could I add more budget to YouTube? And what I want to like sort of start and contend with is that I'm working on tool to think about return on investment capital across different investment modalities inside any commerce business. So if you were to invest a hundred thousand dollars into YouTube, what would the annualized return expectation be on that money? Now let's imagine you took that same a hundred thousand dollars and you said, I'm going to try to create a product that gets attention. And I'm gonna do it through a marketing lens, not through like a product sales lens with that same a hundred thousand dollars. My question is what would happen in that space?

Like if you just did that exercise, if you said, look at your budget for next year, your media budget. And let's say it's 10 million. We're talking primarily to eight figure businesses in our arena. Okay. And we said, all right, I want you to take 5 percent of 10 million, half a million bucks. Okay. And I want you to take it out of the media budget. And with it, I want you to commit to developing products that could be used to drive attention, story, and marketing in support of your broader connection, what would happen if you did that? I think that what would happen is that you would rise the overall brand profile and the marketing efficacy of the other 9.

5 million bucks. And that's kind of what I'm after with this idea is to stop just taking next year, we cannot presume that we're just going to spend more money at greater efficiency. In the same way across the same core product set, it won't happen. It won't happen. And so we have to start to get into novelty story and do it through the creation of new products that allow us to expand the story of the brand.

[00:26:58] Richard Gaffin: All right. I think I think that'll wrap it up for us. Again, thanks folks for joining us. We're going to continue to have this conversation over the next few weeks. We're having Adrianne come on next week to chat a little bit about how we're approaching some of the more practical elements practical tactical elements of creative execution and volume enablement which is just continuing to going to continue to be part of the conversation here, but.

All right, folks. Well, thanks for joining us. Again, if you want to continue to have this conversation with us com threat co. com, hit that high risk button. We would love to chat, but all right, till next week, folks, take care.