Your Black Friday Sale Doesn’t Need to Last All November

Stop Discounting. Groove Life's Profits Tripled When They Did

[00:00:00] Kyle 2: So I think there's nuance to every position, and so Q4 discounting makes sense. Everybody's looking for a discount. Most brands are looking for a discount. I'm not advocating that you don't discount. The question is how deep- Yep ... for how long, and then the rest of the year, are you pulling demand forward by discounting, right, versus just playing in the big moments.

[00:00:16] Kyle 2: So kind of what we committed to in '26 was we're only gonna discount for Father's Day and for holiday.

[00:00:21] Speaker: Every few years, a new platform earns its place at the top of every smart advertiser's media plan. AppLovin just had the most remarkable run in ad tech history, and now they've opened that engine to e-commerce. AppLovin gives brands another way to reach more than a billion daily users through full-screen ads in the mobile games they already love.

[00:00:38] Speaker: With Q4 around the corner, smart D2C brands are moving fast. Dr. Squatch, Ridge, and Tumble all made AppLovin part of their strategy to reach their Q4 growth targets last year. It's super easy to launch, and brands have been able to scale to 100K per day in spend within days. Q4 waits for no one. AppLovin is offering 5K in ad credit when you spend 5K.

[00:00:59] Speaker: Just go to applovin.com/ctc to set up your first campaign

[00:01:04] Taylor: Welcome to the Ecommerce Playbook Podcast Live. Live, sort of. Maybe not in your feed live, but we're here live at Commerce Roundtable event in San Diego. You can see the beautiful San Diego... That's not AI.

[00:01:18] Kyle: Kyle,

[00:01:18] Taylor: tell 'em. No, that's

[00:01:18] Kyle: real.

[00:01:18] Taylor: That's real. Tell 'em it's real. Sign's real. Yeah. It's all real. It's

[00:01:21] Kyle: all real.

[00:01:21] Taylor: And he's real.

[00:01:22] Kyle: Yes.

[00:01:22] Taylor: This is, this is a interesting character in my life. Whether he knows it or not, we've been competitors in the arena together. Yeah. We've been having drinks discussing the deepest portions of life together, and now here we are today on a podcast. I'm joined by Kyle Yeoman. He is the president of Groove Life.

[00:01:39] Taylor: Kyle, it's a ple- pleasure to have you, sir.

[00:01:40] Kyle: Yeah, thanks for having me. Excited to be here.

[00:01:42] Taylor: Yeah. So Groove Life, tell us a little bit about what it is, and then I'll give some context to what we're gonna talk about today.

[00:01:47] Kyle: Yeah. So you mentioned competitors in the arena. Groove started out as a silicone ring company.

[00:01:53] Kyle: Started in 2016 by Peter Goodwin. He, uh, developed the ring in his garage in Alaska. That business boomed, and then in 2020 we introduced belts, uh, the same way, and we've really gone into men's premium accessories from there. And so silicone rings are still a part of our business, but that was just our start.

[00:02:09] Kyle: And so, yeah, that's what we do.

[00:02:11] Taylor: So I say competitors in the arena 'cause that, back in those days... 'Cause you said you started in 2018 at-

[00:02:16] Kyle: Like end of 2018-

[00:02:17] Taylor: Yeah ... was my

[00:02:17] Kyle: first, my first round.

[00:02:17] Taylor: So, so we were very much in the throes of running Calo at the time, so another silicone wedding ring. And it was really us two that were sort of the main, uh, leaders at the moment.

[00:02:26] Taylor: Maybe one other player in the space, but uh, the silicone ring wars of the early... But the, the good thing that you guys did that we failed to do was to find that second product category. So tell us a little bit about belts and how you went from rings to belts and what that's done for the brand up

[00:02:40] Kyle: till this moment.

[00:02:41] Kyle: Yeah. It's been huge for the brand. I mean, that's been most of our growth since 2020. Rings are a very stable category for us. Um, it's not as sophisticated as you might think. So our founder is innovative, very innovative. And all of our products have patents and, uh, go through a, a long timeline basically to come up with a concept and then bring it to market.

[00:02:58] Kyle: And so there's really not a lot of correlation between our ring and belt buyer- Interesting ... other than that we just made an awesome new product. Yeah. And it took took off. So I think actually, actually a challenge is that there's not a lot of crossover

[00:03:09] Taylor: Yeah. Well, I think that's an underappreciated thing that people don't realize is they think a lot about product expansion as like, "Oh, it's gonna increase my LTV."

[00:03:15] Taylor: And it actually rarely does. Right. Like category cross-sell in e-commerce happens way less than people realize.

[00:03:20] Kyle: Yeah.

[00:03:20] Taylor: Um, but it is mainly about unlocking that new customer acquisition. So that- Mm-hmm ... so you guys have done an awesome job of that and sustained it, and now you are back as the president. You are- Yeah

[00:03:28] Taylor: you, like what does a president do?

[00:03:30] Kyle: A little bit of everything equally- Yeah? Okay ... is what I tell people. Yeah. No. So I, I came back in 2022 as CMO.

[00:03:34] Taylor: Okay.

[00:03:35] Kyle: And then kind of took over more and more responsibility and moved into the president role about two years ago. Um, it's still very much growth focused, right?

[00:03:43] Kyle: We're a, we're a marketing and sales organization at, at the heart of it. So we kind of went through this, this process of saying we're actually a product first company. I think that was a mistake.

[00:03:51] Taylor: Mm.

[00:03:51] Kyle: Uh, and so we pivoted back to being we're a sales and marketing company. Interesting. And what does

[00:03:55] Taylor: that, how does that change you guys culturally?

[00:03:57] Taylor: I think- Or like what, what is the distinction? ...

[00:03:58] Kyle: investment. Like- Mm ... like how much do you invest in R&D versus marketing, right? Okay. So one of the things we did early on is we started to reduce marketing spend- Oh, interesting ... to invest in other categories because our product's good enough to sell on its own.

[00:04:08] Taylor: Yeah.

[00:04:08] Kyle: And it's like that's not true.

[00:04:09] Taylor: Interesting.

[00:04:10] Kyle: Even though we have great product. Right. It's just not true.

[00:04:12] Taylor: Right.

[00:04:12] Kyle: So I think it's, yeah, mostly focus and investment.

[00:04:15] Taylor: Interesting. Yeah, that ma- that makes total sense. So, uh, you're here-

[00:04:18] Kyle: Yeah ...

[00:04:19] Taylor: uh, on this, on this series that we're doing because you're speaking.

[00:04:22] Kyle: Yeah. Tomorrow.

[00:04:22] Taylor: Tomorrow? Yeah. Taking the main stage.

[00:04:24] Kyle: Yeah. Excited about it.

[00:04:24] Taylor: What are you gonna be talking about?

[00:04:26] Kyle 2: How discounting is not a growth strategy. So basically the pitch is, is that you should be focusing on quality of revenue, which we should define. Yep. I know you're big on definitions. Define quality of revenue instead of top line. Okay. So don't chase top line, chase quality of revenue.

[00:04:38] Taylor 2: Okay. So that's a setup because we're here to talk mainly about Q4.

[00:04:42] Kyle 2: Right.

[00:04:43] Taylor 2: Which is primarily an attempt to capture value through discounting.

[00:04:46] Kyle 2: Right.

[00:04:47] Taylor 2: Yep.

[00:04:48] Kyle 2: So

[00:04:48] Taylor 2: help me square the, uh, circle here-

[00:04:50] Kyle 2: Yep ...

[00:04:50] Taylor 2: and figure out what is... how do you then, in Groove, how do you approach Q4 in light of it being discounting with doing that in a way that doesn't create the damage you're concerned

[00:04:59] Kyle 2: with?

[00:05:00] Kyle 2: Right. So I think there's nuance to every position, and so Q4 discounting makes sense. Everybody's looking for a discount. Most brands are looking for a discount. I'm not advocating that you don't discount. The question is how deep- Yep ... for how long, and then the rest of the year, are you pulling demand forward by discounting, right, versus just playing in the big moments.

[00:05:16] Kyle 2: So kind of what we committed to in '26 was we're only gonna discount for Father's Day and for holiday. The rest of the year is full price. And by doing that, right, you're gonna build up pent-up demand, and then you can deploy it at the most efficient season. So that's, that's really more the positioning.

[00:05:30] Taylor 2: That's great. So, okay, so twice a year. That's it.

[00:05:33] Kyle 2: Yeah. That's it.

[00:05:34] Taylor 2: And-

[00:05:34] Kyle 2: None of this year so far.

[00:05:35] Taylor 2: And you've made-

[00:05:35] Kyle 2: I'm so excited for November ...

[00:05:37] Taylor 2: now, so yeah. So you've got some built up- So ready ... demand to g- to ready to go.

[00:05:40] Kyle 2: Yeah.

[00:05:41] Taylor 2: So do you think that part of your ability to do that... 'Cause a lot of times discounting, in my head, is really about turning aged inventory back to cash when you've missed the market on product creation or inventory.

[00:05:58] Taylor 2: Yeah. So, a-and you guys do benefit. I don't know about the, I can't speak to the belts as much, but on the ring side, really low cost of goods. Very low, yeah. Very little, very little inventory risk. Great business. Yeah. So you don't carry a lot of like, "Oh no, I have to liquidate this. There's large holding costs or absol."

[00:06:12] Taylor 2: So how do you think about the relationship between the price at which you can sell the product and the price at which the market accepts the product?

[00:06:18] Kyle 2: Right. I think it's a really good question. And so to your point, even for belts, we do all of our own assembly and fulfillment in, in Tennessee. Yeah. And so we can move stuff around, right?

[00:06:28] Kyle 2: We very, very rarely have aged inventory. I think it makes sense to discount and move aged inventory. What I have found, though, is that when it doesn't move at full price, it doesn't move very well at discount either.

[00:06:37] Taylor 2: Even at a

[00:06:37] Kyle 2: discount. And so I think it's, it's less that you shouldn't discount those on the short term, but the question is, if you're doing that every year-

[00:06:43] Taylor 2: Right

[00:06:44] Kyle 2: like fix your forecasting- Right. Yeah ... fix your product iteration. There's, there's a different problem

[00:06:47] Taylor 2: to solve.

[00:06:48] Kyle 2: There's just... Right.

[00:06:48] Taylor 2: Yeah. So that's- So that, that's like a, that's an outlet, a, a go-to if necessary, not the strategy.

[00:06:52] Kyle 2: Correct.

[00:06:52] Taylor 2: Yeah. That's

[00:06:53] Kyle 2: the better distinction. And I think the bigger thing I'm hitting on is, is your evergreen product.

[00:06:55] Taylor 2: Yeah.

[00:06:56] Kyle 2: Because it's like sales are soft this month, and every marketer I know goes, "Well, you know, the consumer."

[00:07:02] Taylor 2: Who do you think... So 'cause... No, I, the consumer. Yeah. Our fault. Um-

[00:07:05] Kyle 2: Yeah ...

[00:07:05] Taylor 2: the question I have is in your organization, and maybe, maybe- Yeah ... this is you because you are a marketer by trade, but who gets to decide the price?

[00:07:15] Kyle 2: Mm. Again, not, not a super sophisticated process. We try to go just above competitors.

[00:07:21] Taylor 2: Okay.

[00:07:22] Kyle 2: So we really just benchmark it there, and then cost of goods needs to reflect that. And

[00:07:24] Taylor 2: is that you get to decide? Or like-

[00:07:27] Kyle 2: Our found-

[00:07:27] Kyle 2: could a

[00:07:27] Taylor 2: marketer?

[00:07:28] Kyle 2: No.

[00:07:28] Taylor 2: Okay.

[00:07:29] Kyle 2: Yeah. So that's me and our founder and our CFO- So this- ... sit down and say, "This is what we want it to

[00:07:33] Taylor 2: be." And this is w- so I've kind of waged an internet war against the head of growth title.

[00:07:38] Kyle 2: Me. Yeah.

[00:07:38] Taylor 2: And in part because I think it's related to decisions like this, where- Yeah ... if you're gonna be responsible for the outcome, the question is what do you have the authority over?

[00:07:45] Kyle 2: Mm-hmm.

[00:07:46] Taylor 2: Um, now hopefully you guys are really good at naming the price and, but if I'm a CMO and you have control over the price and I don't- Right ... and I'm told, "Go sell it," and I think that there's some mismatch to the demand there, there's a lot of trust that has to be built-

[00:07:59] Kyle 2: For sure ...

[00:07:59] Taylor 2: between whose responsibility then ultimately that is in that process.

[00:08:02] Taylor 2: And I think that's one of the things that when I think about, a lot of times what I see is that if an organization is product led, like you described, then the ops team prices based on the gross margin desire that they have.

[00:08:13] Kyle 2: Right.

[00:08:13] Taylor 2: And so the price is just an out- We need 8%. Exactly. Yeah. So i-ir- regardless of what the market- Right

[00:08:17] Taylor 2: will accept, it's like we have a gross margin expectation, here you go, there's the price. Yeah. Versus if a marketer sets it, it's the alternative, right? Right. They're gonna try and price it as low as they can because- For volume. Exactly.

[00:08:27] Kyle 2: Yeah. 100%.

[00:08:27] Taylor 2: And so th-this is one of the things I watch toggle between an organization of who's forward and led in it.

[00:08:32] Taylor 2: So I think that having- Yeah ... you in that seat actually probably is really helpful to think about that. But, um, how do you think about, because this is true in silicone rings. I know, I know one of the things that I experienced was that the market expectation of the price changed over time-

[00:08:45] Kyle 2: Right ...

[00:08:46] Taylor 2: in a way that was kind of outside of our control- Mm-hmm

[00:08:48] Taylor 2: in the sense that because it's a high gross margin category, when we started day one it was like you and us and nobody else on Amazon.

[00:08:56] Kyle 2: You guys were first.

[00:08:56] Taylor 2: And you go on there and now there's 1,000 listings.

[00:09:00] Kyle 2: Right.

[00:09:01] Taylor 2: And I remember I think it was like Rhino Rings was probably first. Mm-hmm. There was like five for five bucks.

[00:09:05] Kyle 2: Cheap. Yeah.

[00:09:05] Taylor 2: Right. Yeah. And so all of a sudden the consumer- Yeah ... expectation of the price, because you have limited barrier to entry, and I know, like there's these elements where all of a sudden the market expectation of price changes.

[00:09:17] Kyle 2: Right.

[00:09:18] Taylor 2: So how do you think about those effects in a market as it relates to discounting versus pricing over time?

[00:09:24] Kyle 2: That's a good question, and I think it depends on your product, right? So if you are in a commodity, if you sell air filters-

[00:09:29] Taylor 2: Right ...

[00:09:30] Kyle 2: and that by actually maintaining a higher price point, we play in a different space.

[00:09:34] Taylor 2: Yeah.

[00:09:34] Kyle 2: So we don't collect all the same volume, but we have much better margins.

[00:09:38] Taylor 2: Yep.

[00:09:38] Kyle 2: Right? And we've, we've maintained. So our ring business has not shrunk.

[00:09:41] Taylor 2: Right.

[00:09:41] Kyle 2: It's been very, very steady. Yep. And it's because we've maintained price. Yep. So we've raised prices on rings. Yep. Our silicone ring is $55 on Amazon.

[00:09:48] Taylor 2: Interesting.

[00:09:48] Kyle 2: And so, uh, yeah, I think it's more about just like owning your place. And this goes back to the discounting. Everybody goes, "Well, we need to compete on price." And so we've just said, "What if you remove that option?"

[00:09:57] Taylor 2: Yeah. '

[00:09:58] Kyle 2: Cause then constraint- Yeah ... builds innovation, right?

[00:10:00] Taylor 2: Well, I just re I, I love that.

[00:10:01] Taylor 2: I, I think one of the biggest things that organizations struggle with is that they'll... Whatever they want to be, they'll, they'll capitulate to- Yeah ... the problems all the time. Right. Versus when you draw those boundaries and clear constraints, it forces innovation in different ways. So totally- Yeah ... I love that.

[00:10:13] Taylor 2: I think that the, uh, the IP thing is really interesting. Like I, I think that one of the things that you could probably plot into some cool data visualization is the relationship between the barriers to entry and pricing power over time.

[00:10:27] Kyle 2: Yep.

[00:10:28] Taylor 2: And this is just general macroeconomics, but I think e-commerce suffers terribly from lack of barriers to entry.

[00:10:34] Taylor 2: Right. That it forces people into these pricing battles because they have no product advantage.

[00:10:38] Kyle 2: Right. Yeah, there's

[00:10:39] Taylor 2: no differentiation. Realistically, it truly is a commodity- Yeah ... at the end of the day.

[00:10:42] Kyle 2: Yeah.

[00:10:42] Taylor 2: Um, and in some ways this is like a gripe I have with like the Shopifys of the world, is that the whole idea of like arming the rebels and lowering the barrier to entry to do everything- Right

[00:10:52] Taylor 2: isn't actually good for us. Yeah. It doesn't actually serve you as a brand that everybody else can very easily replicate what you do.

[00:10:57] Kyle 2: Right.

[00:10:57] Speaker: Brands like Wayfair, Kitsch, and Ridge are already scaling on AppLovin while most of their competitors don't even know it exists. A billion daily users, full-screen attention, and a model that optimizes purely for your profit target and nothing else. Median watch time is thirty-five seconds. That's longer than a standard TV commercial, giving you enough time to tell your story and build real interest before the holiday rush.

[00:11:19] Speaker: You can get up and running on AppLovin in under an hour using creatives you already have. D2C brands have scaled to six-figure daily spend within days of launching. Don't wait until peak season to add a new growth channel. You'll get five K of ad credit when you spend five K. Just go to applovin.com/ctc to get started

[00:11:37] Taylor 2: as you guys get... Give me Q4 then.

[00:11:40] Kyle 2: Yeah.

[00:11:40] Taylor 2: Knowing that you have all this built-up demand-

[00:11:42] Kyle 2: Mm-hmm ...

[00:11:43] Taylor 2: give me the month of November. Yeah. Offer design, when are we live? How long are we running for? How does that show up for you guys this Q4?

[00:11:52] Kyle 2: It's short. Oh. We're not starting till the week of Black Friday.

[00:11:54] Taylor 2: I love it. Yeah. I love it. Okay.

[00:11:55] Kyle 2: Wednesday before.

[00:11:56] Taylor 2: Great. I love it. We're

[00:11:57] Kyle 2: gonna run it for a week.

[00:11:58] Taylor 2: I love it.

[00:11:58] Kyle 2: Then we're done.

[00:11:59] Taylor 2: I think this is the way. I actually- Do you, do you actually agree with this? I actually- I

[00:12:02] Kyle 2: thought you were gonna say the

[00:12:02] Taylor 2: opposite. No. I think that-

[00:12:04] Kyle 2: Interesting ...

[00:12:05] Taylor 2: there is this obsession with starting earlier-

[00:12:09] Kyle 2: Mm-hmm

[00:12:09] Taylor 2: that I don't believe does anything to drive incremental revenue. I don't think it does. It drives none. In, in fact, like your, your, the, the most efficient media dollar, like everyone gets obsessed with CPMs, but it, the, the idea is that it's all relative to the conversion rate that's available to you. Yeah.

[00:12:25] Taylor 2: And so repeatedly I see that the most efficient time period is when culture actually shops. That like- Right ... your sales starting earlier doesn't do anything to change people shopping. People are shopping, yeah. No. So you can start it whenever the hell you want. Nobody cares.

[00:12:37] Kyle 2: Right.

[00:12:38] Taylor 2: And the only people that do are the people that were gonna for sure buy anyways.

[00:12:41] Kyle 2: And you just gave them a discount-

[00:12:42] Taylor 2: That's right ...

[00:12:42] Kyle 2: for no reason. Yeah, you just gave it up. Yeah.

[00:12:44] Taylor 2: And so I think that I have actually-

[00:12:46] Kyle 2: Yeah ...

[00:12:46] Taylor 2: been a proponent that I, I do, I think, I still think Wednesday. People can go to Monday, but I think that the peak value creation period is Wednesday to Monday. Okay. It's that, it's that window.

[00:12:56] Kyle 2: We've always seen it too. I mean, it's just like-

[00:12:58] Taylor 2: Totally ...

[00:12:58] Kyle 2: for some reason people are, are traveling and then all of a sudden they're ready to shop. And- And we're focusing more on we're keeping consistency of offer, but we're just changing messaging. So- And, and it just- ... pre-Black Friday, Black Friday post.

[00:13:08] Taylor 2: I agree.

[00:13:09] Taylor 2: A- and it, it, the labor, the amount of work. Mm. Yeah, like there's so many things that actually for almost no incremental value that you're stretching this out so much further.

[00:13:18] Kyle 2: Right.

[00:13:18] Taylor 2: And what I, what I prefer is, is there actually a... So for brands, the first weekend of November is Veterans Day.

[00:13:25] Kyle 2: Mm-hmm.

[00:13:26] Taylor 2: Is there actually something not Black Friday related, some way in which you can drive some incremental moment of value-

[00:13:32] Kyle 2: Yep

[00:13:32] Taylor 2: that is disassociated from that? And allow that to still be there, but don't drag it forward into the period. Is there something else we can do or say? Um, and I think a lot of ways this is how Amazon ended up with, uh, what's their, what am I thinking of?

[00:13:44] Kyle 2: The Bs or the-

[00:13:45] Taylor 2: No. What's their big sale? I'm drawing a complete blank.

[00:13:48] Taylor 2: Prime Day. Thank you. Prime Day in October, right? Yeah. Is, or, is because they recognize, oh, if I can drive this peak of demand ahead of- Right ... where it already exists- Yeah ... then I can create incremental value that way.

[00:13:58] Kyle 2: Yeah.

[00:13:58] Taylor 2: Um, okay. So give me the example of the discounting thing that you think represents the most damaging example that you see.

[00:14:08] Kyle 2: I think brands starting Black Friday sales October 1-

[00:14:11] Taylor 2: Yeah ...

[00:14:11] Kyle 2: and running it through the end of the year. Yeah. And then Q1 is just a nightmare because all you've done is you've pulled forward all the people that were gonna buy later-

[00:14:18] Taylor 2: Yep ...

[00:14:18] Kyle 2: and extended it, and now you've reset basically your- Perceived price at your discount rate because it's been that way for three months.

[00:14:25] Kyle 2: There- So I think that's the-

[00:14:26] Taylor 2: There are so- ... that's the worst ... so many brands that have, like they're just, they've gotten themselves into a habit where the funnel that's working best on Meta is a discount funnel.

[00:14:36] Kyle 2: Yep.

[00:14:36] Taylor 2: And so it's now become 30 to 50% of the spend.

[00:14:39] Kyle 2: Yep.

[00:14:40] Taylor 2: And you're stuck.

[00:14:41] Kyle 2: There's no way out.

[00:14:42] Taylor 2: You can't turn it off.

[00:14:43] Kyle 2: Yep.

[00:14:43] Taylor 2: The top line drop will be too impactful.

[00:14:45] Kyle 2: Mm-hmm.

[00:14:46] Taylor 2: And the ability to subsidize it quickly doesn't exist.

[00:14:49] Kyle 2: Right.

[00:14:50] Taylor 2: It's gonna take a long time to reconstruct that, and you are now in prison. You are in discount prison. And I- Until you

[00:14:55] Kyle 2: die.

[00:14:56] Taylor 2: Yes. And I see this on the media front and the, to the point that they end up in lawsuits over- Right

[00:15:00] Taylor 2: like this is not really your price. Right. Like this has never actually been off of discount- Right ... for any period of time.

[00:15:05] Kyle 2: Yeah.

[00:15:05] Taylor 2: So what do I do? I'm stuck. I'm in a prison.

[00:15:07] Kyle 2: This is exactly what I'm talking about, Troy. Okay.

[00:15:09] Taylor 2: How do I get out? Give us a teaser.

[00:15:10] Kyle 2: Because people are discounting. So here's the teaser.

[00:15:12] Kyle 2: You discount to drive top line growth-

[00:15:13] Taylor 2: Yep ...

[00:15:14] Kyle 2: that you think will increase contribution margin and therefore profit. Most of us want profit.

[00:15:17] Taylor 2: Yep.

[00:15:18] Kyle 2: And what ends up happening is you now have to comp that year over year-

[00:15:21] Taylor 2: That's right ...

[00:15:21] Kyle 2: because you've built up an operating expense layer- Yep ... right? This needs more top line.

[00:15:26] Kyle 2: But then you have to go deeper on your discount, you need to run it for longer. So now you have revenue climbing, you have gross margin declining- Yep ... you have contribution margin declining and profit- And OpEx

[00:15:34] Taylor 2: growing ...

[00:15:35] Kyle 2: and OpEx growing.

[00:15:35] Taylor 2: Yep.

[00:15:36] Kyle 2: Then after you've done that long enough, you mentioned the 50 to 70 million- Yep

[00:15:39] Kyle 2: you stall.

[00:15:40] Taylor 2: Yep.

[00:15:40] Kyle 2: So now your revenue dips or stalls.

[00:15:43] Taylor 2: Right.

[00:15:43] Kyle 2: You have a double compound- 'Cause even

[00:15:45] Taylor 2: on that discount funnel it's not working.

[00:15:46] Kyle 2: Right.

[00:15:46] Taylor 2: That keeps rising.

[00:15:47] Kyle 2: Right. So you have to go deeper- Yeah ... or, or, or more offers. Yep. Right? And so now you get the, the compounding effect of all those other three, gross margin, contribution margin- That's right

[00:15:54] Kyle 2: profit. So this is what we did in 2026 is re- we reset and it started by fixing OpEx. Mm. Because you basically- That's exactly ... have to create the space-

[00:16:01] Taylor 2: That's right. That's

[00:16:02] Kyle 2: right ... for the long haul. So this year has been pretty brutal.

[00:16:04] Taylor 2: I like it. Like

[00:16:04] Kyle 2: it's been a brutal mentally, right? It is- As a, as a growth-minded marketer

[00:16:08] Taylor 2: we went through this as like it, it, it is the hardest thing to do because the opex- Yeah ... like it's easy to say opex, but it generally represents people. It's

[00:16:16] Kyle 2: people, software. Yeah. That's kind of

[00:16:17] Taylor 2: it. And, and those are like- For the rest of us ... and, and many, sometimes it's an office is another thing I see in there.

[00:16:22] Taylor 2: Like, where people have these things that they have identity connected to. We have this many- 100% ... employees, we have this cool build, like whatever it is, and it's letting go of that is literally like it's a death that you're dying- Mm-hmm ... almost to a, um, becoming a new thing. Like

[00:16:31] Kyle 2: death of

[00:16:31] Taylor 2: ego almost. It is.

[00:16:32] Taylor 2: Yeah. It really is.

[00:16:33] Kyle 2: Yeah.

[00:16:33] Taylor 2: Um, and but the freedom that it creates to then actually go get healthy is- Yeah ... it's the only way. So like, okay, so I'm a CEO. You're, you're saying I have to fire everyone?

[00:16:45] Kyle 2: I think that you should- Like what do I, what do I

[00:16:46] Taylor 2: have to

[00:16:46] Kyle 2: do? ... understand where you are first. Okay. And if there's actually opportunity.

[00:16:49] Kyle 2: So what we realized is that we were discounting a lot.

[00:16:51] Taylor 2: Yeah.

[00:16:51] Kyle 2: And so we had kind of slowly moved into from 20% of our revenue coming through discounts just even from time period to 40.

[00:16:58] Taylor 2: Yeah.

[00:16:58] Kyle 2: And you go, "We are a promotional business." Like whether or not we wanna act like it, we are, and this is not gonna end well.

[00:17:04] Kyle 2: So we could stay in business for a while 'cause we have Amazon and retail- Yeah ... dot-com and we're healthy. Yeah. But in five to 10 years we're done- Right ... if we don't fix this. Yeah. And so I think it's really important people understand where they're at before they make decisions. I wouldn't make big swings right before Q4.

[00:17:16] Kyle 2: Play out the year like you planned. Yep. But be thinking next year, what does my business need to look like to survive long term?

[00:17:22] Taylor 2: How do you know, how did you know-

[00:17:25] Kyle 2: Mm-hmm ...

[00:17:25] Taylor 2: that there was profitable acquisition available to you? Because one of the things I see is that people- Yeah ... will get the nerve to go, "Okay, I recognize we're discount," but they've actually never had to go out and acquire customers at full price.

[00:17:37] Taylor 2: Mm.

[00:17:37] Kyle 2: Yeah.

[00:17:37] Taylor 2: And so the actual possibility of what, what is out there that is viable is unknown.

[00:17:42] Kyle 2: Right.

[00:17:43] Taylor 2: And they go out and they find out that like no matter what we do, we can't get to a place where- Yeah ... it works. So like, how did you know that there was available to you profitable new customer acquisition that wasn't on

[00:17:53] Kyle 2: discount?

[00:17:54] Kyle 2: We did, we didn't.

[00:17:54] Taylor 2: Yeah.

[00:17:54] Kyle 2: I think it's like, but you're gonna die anyway, right? The business is gonna die anyway- Right ... so you don't really have a lot of options.

[00:17:59] Taylor 2: Yeah.

[00:17:59] Kyle 2: So we didn't. But I g- I personally got a lot more involved in that process. Yeah. So what we used to do was we'd do design by committee, so it's like redo this page, but- Yeah

[00:18:07] Kyle 2: you'd have 10 hands in it. And this became a lot more prescriptive of like, no, this is what needs to be there, and we just kinda

[00:18:13] Taylor 2: went at it first. When... 'Cause one of the things I see happen too is that it's really hard es- and this is harder I think for CEOs and leaders that aren't marketers-

[00:18:21] Kyle 2: Yeah ...

[00:18:21] Taylor 2: because they'll get pushback from their team just saying like, "This isn't poss-" or, "I can't."

[00:18:24] Taylor 2: They're- Right ... more efficiency isn't available. Like- Yeah ... how did you know when you had made it to a place where like this level is good enough or it's good?

[00:18:34] Kyle 2: I don't think there's... I, I'm taking the approach that it's never good enough.

[00:18:37] Taylor 2: Mm.

[00:18:38] Kyle 2: The reason I know it's good this year is because profits- You're making money

[00:18:40] Kyle 2: tripled.

[00:18:41] Taylor 2: Yeah.

[00:18:41] Kyle 2: But I would say it's not good enough. So this is an iterative process. I think the thing that I'm gonna be continually hitting on is that this doesn't stop.

[00:18:47] Taylor 2: Yeah.

[00:18:47] Kyle 2: So it's like, yay. But what we saw, I mean, the reason we got into this in the first place is that you saw conversion rates drop over time from your paid channels.

[00:18:56] Kyle 2: Right? That was like the main- Yeah ... issue. And that always happens over time- Yep ... because- It's gonna degrade ... the consumer evolves. Yep. It's gonna degrade. So you have to be iterating. I think that's the main core to go back to. Don't pull 20% off because it gives you the artificial conversion rate bump. Yeah.

[00:19:06] Kyle 2: Focus on the core, right, to, to convert more. And so the biggest thing this year was we cut our meta CPA in half by doing that.

[00:19:13] Taylor 2: Really?

[00:19:13] Kyle 2: Seven-day click. Crazy. Like apples to apples. I have to show you the- Yeah ... it's kind of insane.

[00:19:16] Taylor 2: That's really cool.

[00:19:17] Kyle 2: But-

[00:19:18] Taylor 2: And so what- And

[00:19:18] Kyle 2: it was all site ...

[00:19:19] Taylor 2: so it was site-wide, the site changes?

[00:19:22] Kyle 2: Yeah. That- It wasn't ads. Really? That's what I'm saying. It's like same, same outbound. Interesting. All the stuff you talk about for outbound- Yeah, yeah ... is still very applicable.

[00:19:27] Taylor 2: No, yeah, yeah. That's

[00:19:28] Kyle 2: fine. But it's like that-

[00:19:30] Taylor 2: And what kind of things? Like persona specific landers? Categories?

[00:19:34] Kyle 2: No, so this is another-

[00:19:35] Taylor 2: Like new CRO changes?

[00:19:35] Kyle 2: One, one product page. So we took our highest volume page-

[00:19:38] Taylor 2: Okay ...

[00:19:39] Kyle 2: and just said, "If, if I didn't work here and I didn't have any personal attachment to it, is this a good page?"

[00:19:43] Taylor 2: Yeah.

[00:19:44] Kyle 2: Answer's no.

[00:19:45] Taylor 2: Okay.

[00:19:46] Kyle 2: And then we sat down and just rebuilt it from scratch. Looked at other categories. So we didn't look at competitors, we looked at people who were selling to the same customer that we felt were doing a great job.

[00:19:55] Kyle 2: Mm. It's very soft. It's like Rick Rubin. What's his thing? Yeah,

[00:19:58] Taylor 2: yeah. Taste,

[00:19:58] Kyle 2: vibes. I have no skill but taste.

[00:19:59] Taylor 2: Yeah.

[00:19:59] Kyle 2: But it really is that. Yeah. It's like this feels right. Yeah. And then we just did it and rolled it out. And it worked. Yeah. And it worked. So it's, I mean, it's a

[00:20:05] Taylor 2: little risky. There's an interesting, like, so there's always this tension between breadth and depth as it relates- Mm-hmm

[00:20:09] Taylor 2: to these testing opportunities where the idea of your PDP, and I've even thought about like people, like your homepage as the lander. What-whatever- Mm-hmm ... page the vast majority of your traffic goes to.

[00:20:20] Kyle 2: Yeah. Do

[00:20:21] Taylor 2: you spend a lot of time trying to make that core thing better, or do you launch 1,000 pages? The, the thousand page thing, I think it's intoxicating because people really love the idea of like, there's this very specific message for this person that we think we know who they are- Mm-hmm

[00:20:33] Taylor 2: and so we can tell. And so- Yeah ... but the problem is like when you develop that many iterations of a thing, it becomes really hard to actually understand the variable that's making a difference. Right. It's like really challenging.

[00:20:41] Kyle 2: Yeah.

[00:20:41] Taylor 2: So, so right now you guys drive all your ad traffic to a PDP.

[00:20:45] Kyle 2: Mm-hmm.

[00:20:46] Kyle 2: That's crazy. One.

[00:20:46] Taylor 2: And that made the biggest difference.

[00:20:47] Kyle 2: Mm-hmm.

[00:20:48] Taylor 2: Wild.

[00:20:49] Kyle 2: So conversion rate is up 61% year over year, apples to apples-

[00:20:53] Taylor 2: Crazy ...

[00:20:53] Kyle 2: on those pages.

[00:20:54] Taylor 2: On just the PDP?

[00:20:55] Kyle 2: Just the PDP.

[00:20:56] Taylor 2: And what visually, if you were to hold them both side by side- ... what would I see as the biggest difference?

[00:21:01] Kyle 2: So all of it. Really?

[00:21:02] Kyle 2: I mean, we literally rebuilt it. I can show you

[00:21:03] Taylor 2: the- Different product photos.

[00:21:04] Kyle 2: Different- Different product photos, different copy, different sections. Different... Right. We just basically went for length. So one of the things too was everybody I've, I've heard is A/B test, A/B test. Yeah, yeah. You basically A/B tested into nothing.

[00:21:13] Taylor 2: Yeah. Right.

[00:21:14] Kyle 2: So our old PDP was just a photo and an overpriced web belt. Yeah. Right? It's like, why would I pay $65 for this belt?

[00:21:20] Taylor 2: Yeah.

[00:21:20] Kyle 2: It's a belt.

[00:21:21] Taylor 2: Yeah.

[00:21:21] Kyle 2: And so what we did is we just said, "Let's, let's try to educate the customer." Interesting. And so the pushback I've always gotten is that only 25% of people go past the fold.

[00:21:29] Taylor 2: Yeah. Yeah.

[00:21:29] Kyle 2: So don't worry about it.

[00:21:30] Taylor 2: Right.

[00:21:30] Kyle 2: And we kind of took the opposite, which is like, "No, those are your highest intent- Right ... 25%." And so we built out a very long sales page essentially. Yeah.

[00:21:36] Taylor 2: Yeah. I mean, if you can improve that 25%, 50%, that's 12 and a half percent increase to your page. Yeah. Like there's, there's real wins.

[00:21:41] Taylor 2: Yeah.

[00:21:41] Kyle 2: And we rewrote the copy. Interesting. Like humans rewrote

[00:21:43] Taylor 2: it. Yeah.

[00:21:44] Kyle 2: Like, is this compelling? And then A/B tested the copy.

[00:21:46] Taylor 2: Mm.

[00:21:47] Kyle 2: But we don't test layouts to death. We don't test- Interesting ... we just go like, "Do, would we wanna buy this?"

[00:21:51] Taylor 2: Yeah.

[00:21:52] Kyle 2: Cool. So anyway, it's been an interesting-

[00:21:54] Taylor 2: Yeah.

[00:21:54] Kyle 2: This- ... exercise. We'll see how Q4 goes.

[00:21:56] Kyle 2: I mean, it may, may not be what I hope, but we'll see.

[00:21:58] Taylor 2: How about, this is another one of my topics I'm gonna ask everybody this.

[00:22:01] Kyle 2: Yeah.

[00:22:01] Taylor 2: Black Friday spend day of. Yeah. Incremental or not incremental? Most spend or least spend on the day of meta.

[00:22:10] Kyle 2: Non-incremental

[00:22:11] Taylor 2: Non-incremental. So you spend less on Black Friday than you do on the- No,

[00:22:16] Kyle 2: we still spend more.

[00:22:17] Kyle 2: Okay. I just am not convinced it's that incremental.

[00:22:19] Taylor 2: How do you define the amount spent?

[00:22:23] Kyle 2: It's-- I mean, this is non-scientific. Yeah. I, I'm gonna show how, how little I know. It's based off of traffic projections. Okay. Right? And it's like, basically, what is my cost of traffic and my assumed conversion rate and AOV?

[00:22:33] Taylor 2: Okay.

[00:22:34] Kyle 2: But we found in years where we ran linear TV, that gave us way more lift.

[00:22:39] Taylor 2: Yeah.

[00:22:39] Kyle 2: Like some of those...

[00:22:41] Taylor 2: So you run linear TV like the two weeks preceding it or the month

[00:22:44] Kyle 2: preceding it? We, we for the year preceding it- Okay ... but then you ramp budgets there.

[00:22:47] Taylor 2: Oh, interesting.

[00:22:47] Kyle 2: So you basically take all the-

[00:22:48] Taylor 2: So you're saying day of spend on linear TV being more incremental- For the week

[00:22:52] Taylor 2: than day of spend on- Yeah ... of the week

[00:22:53] Kyle 2: of. Yeah, 'cause linear, like you, we do remnant, so it's really efficient. Yeah. But like you, you can't do a day spend.

[00:22:59] Taylor 2: Yeah.

[00:22:59] Kyle 2: So it's important you line up the week of clearance, right? Like you have to clear midweek to midweek.

[00:23:04] Taylor 2: Yep.

[00:23:05] Kyle 2: And that, so like YouTube, TV, all those have been, in my opinion, more incremental.

[00:23:09] Taylor 2: So whatever number you wrote down, you, you have a, you have a revenue goal, you back out the conversion rate, AOV to get your expected CPC and that becomes the budget?

[00:23:18] Kyle 2: Pretty much.

[00:23:19] Taylor 2: How do you know if you don't-- If you were to write down 10% more money, it wouldn't be more money?

[00:23:25] Kyle 2: Can you say that a different way?

[00:23:26] Taylor 2: So let's just make up some made-up numbers. Yeah. You, you do that formula, you come out and you say, "Our meta spend is $100,000 today."

[00:23:31] Kyle 2: Yeah.

[00:23:32] Taylor 2: Well, what if it was 110?

[00:23:35] Kyle 2: Then you might. I would-

[00:23:35] Taylor 2: Does that-- 'Cause if it's a formula-

[00:23:37] Kyle 2: Yeah, yeah ...

[00:23:37] Taylor 2: then the CPC times the- Yeah. Absolutely ... the money just goes up.

[00:23:40] Kyle 2: Yes. Except for you have-- It's, it is incremental, but it's not at the rate at which, right?

[00:23:46] Kyle 2: So like if you run at 20% ad spend to revenue-

[00:23:49] Taylor 2: Right ...

[00:23:49] Kyle 2: even if that is incremental- Right ... at a 1.5 or two- Right ... that's still 50%, right? Yeah. So you're, you're inching up. So that's usually our barrier is what is our, our-

[00:23:58] Taylor 2: MER goal or whatever

[00:23:59] Kyle 2: it is for the- Right. Yeah. Like what's the efficiency? So that's more the cap, less that you couldn't drive more.

[00:24:02] Kyle 2: And I think that goes back to the point, you could drive more revenue through a deeper discount too.

[00:24:05] Taylor 2: Yeah.

[00:24:06] Kyle 2: But should you?

[00:24:07] Taylor 2: Yeah.

[00:24:08] Kyle 2: Today. I mean, again, obviously long-term you wanna grow but I think that's the question.

[00:24:11] Taylor 2: Do

[00:24:11] Kyle 2: you- Does that make sense?

[00:24:12] Taylor 2: Yeah. I mean, I think the, the, the tension always-- And I think this is, there's, this is actually a thing I get criticized for in my organization.

[00:24:19] Taylor 2: There's, there's two ways to think about opportunities. Yeah. There's to create a plan, to create an outcome- Mm-hmm ... and to decide that that outcome is good enough and we're going to produce that. Mm-hmm. And we're actually gonna let go of the question of whether or not we maximize the opportunity.

[00:24:31] Kyle 2: Yeah.

[00:24:31] Taylor 2: That's actually my preferred method because- Which

[00:24:33] Kyle 2: is your preferred?

[00:24:34] Taylor 2: The, to build a plan and execute to the plan- Yeah ... and not deviate from it- Right ... including leave upside on the table.

[00:24:38] Kyle 2: Correct.

[00:24:39] Taylor 2: Versus I think our e-commerce is way more like scale it if it's working.

[00:24:44] Kyle 2: Yeah.

[00:24:44] Taylor 2: That creates all sorts of problems.

[00:24:45] Kyle 2: Tons.

[00:24:46] Taylor 2: Um, but Black Friday is one of those days where you-- It's almost impossible to leave without feeling that in one way or another I overdid it or under did it-

[00:24:55] Kyle 2: Sure ...

[00:24:55] Taylor 2: all the time. And so I think, um, what you're describing, it sounds like you guys have developed a certain amount of discipline around like we don't, we don't actually wrestle with the question of whether or not we milked every dollar out of it as possible.

[00:25:06] Taylor 2: It's like we had a plan, did we do the thing? Yeah. That's good enough for us.

[00:25:08] Kyle 2: Yeah. And we

[00:25:09] Taylor 2: have- Is that how you

[00:25:09] Kyle 2: feel? 100%. Yeah. That's how I feel. And I think Your teams reflect you as a person, right? Yeah. So if you feel that way, your team will start to reflect that. Yeah. Even if they criticize you now. Yeah.

[00:25:17] Kyle 2: And yeah, so that's, that's how I tend to be more disciplined and organized and go like, I would rather-- Which would I rather leave with? Feeling like I didn't get as much as I could or I way overdid

[00:25:26] Taylor 2: it? Over it, yeah.

[00:25:27] Kyle 2: And it's like, I'd much rather feel like I left something on the table- Yeah ... than I overstretched and caused some problems.

[00:25:30] Kyle 2: Yeah. So.

[00:25:32] Taylor 2: I think the, the point you made earlier too, the other trap is that, like, people substantially underestimate the damage to the year-over-year comp and next year's- Oh, okay ... opportunity when you torch it. Like you've-- It's gonna take you actually two years to recover- Mm ... from this problem. Hundred

[00:25:46] Kyle 2: percent.

[00:25:47] Taylor 2: Um, and it is such a long journey to get back to. Once you've chased that top line at a level that's inefficient, you're gonna have to go so far backwards to go back forwards.

[00:25:57] Kyle 2: Right.

[00:25:57] Taylor 2: And it becomes really, really hard to do- Yeah ... to accept that. Um, and so- Yeah ... people just keep on the throttle.

[00:26:01] Kyle 2: I think that's the biggest issue with our industry overall is, is lack of patience.

[00:26:05] Kyle 2: Yeah.

[00:26:06] Taylor 2: Yeah. Sounds like you've been listening- I wanna, I wanna hear- ... to the Andrew Ferris podcast. Yeah, I, I think, I think the idea of-- I think people underestimate, especially the-- And this is the thing even for us learning as you go sell, is that if I'm gonna pay you a discount on future earnings, which is functionally what all sales are, right?

[00:26:22] Taylor 2: There's somebody bringing forward your future earnings and giving you, "I'm gonna take a multiple arbitrage on that value- Mm-hmm ... at some rate of return for myself." The predictability of that future revenue is just a model extrapolation of how predictable your historical is. Right. So if you're 20% then 180% and then negative 7% and then 48, it's like- Right

[00:26:41] Taylor 2: how, wh-what future earning am I gonna model off of that? Versus if it's 30%, 30%, 30%, 30%.

[00:26:47] Kyle 2: Yeah.

[00:26:48] Taylor 2: Banks love that. They wanna-- They'll write debt against it.

[00:26:51] Kyle 2: Mm-hmm.

[00:26:51] Taylor 2: Somebody who's gonna underwrite it and isn't sophisticated and works in private equity is gonna love that. And so that ability to with-withstand the chasing the 100,

[00:27:00] Kyle 2: 200%- Yep

[00:27:00] Taylor 2: for the 50-50, 50-50 or 30, 30, 30, 30, 30, 30, I think is a real value, especially if your end ambition is to sell the business to somebody who's gonna have to look out into the future and go, "Am I gonna make money on giving you a bunch of cash for this now?"

[00:27:13] Kyle 2: Right.

[00:27:13] Taylor 2: So that's really underrated.

[00:27:14] Kyle 2: We, we landed on that it makes sense either way.

[00:27:16] Kyle 2: Yeah. So if you do go that route, yeah, way better. Like you said, they're finance people. They're not marketers. Yeah. They don't really care about your- Yeah. And then, but if you do keep it It kicks off way more cash if you're consistent.

[00:27:26] Taylor 2: Well, so I think the counter- the question there is this more of the like- Yeah

[00:27:30] Taylor 2: getting while the getting is good. Um, so like if I look, if I go back-

[00:27:34] Kyle 2: Yeah ...

[00:27:35] Taylor 2: let's say it's 2018 again.

[00:27:36] Kyle 2: Yep.

[00:27:36] Taylor 2: You and us are there. Did we underspend or overspend that year? Underspend. Massively.

[00:27:40] Kyle 2: Right.

[00:27:41] Taylor 2: Like, we had no idea- Well, maybe.

[00:27:43] Kyle 2: Maybe. So that's a one-sided, right? That's, that's

[00:27:45] Taylor 2: just you and, you know- Well, I, I just think that the market got so competed away so fast.

[00:27:49] Taylor 2: Yeah. A- and like I- I'll speak for myself because I don't know where you guys were at. Mm-hmm. I-- we should've been more aware of how limited the barrier to entry was and how there were gonna be 1,000 alternatives so fast. But like I look back, you know, we could pull up the early meta accounts from that era- Yeah

[00:28:03] Taylor 2: and it was just printing money.

[00:28:05] Kyle 2: Right.

[00:28:05] Taylor 2: And we just didn't know any better, and the inventory risk was like zero.

[00:28:08] Kyle 2: Sure.

[00:28:09] Taylor 2: So it, like the, the-- there wasn't actually that much risk- Right ... to spend that much money. Um, there was so much gross margin. There-- it was just like, it was, it was so... We could've accelerated so quickly.

[00:28:18] Taylor 2: Now, what would've been the end effect of all of those actions? Well, we would've had to come way down.

[00:28:23] Kyle 2: A bigger drop.

[00:28:24] Taylor 2: Bigger drop. The question is, would we have made more cash along the way? I don't know. Yeah, maybe. Maybe. But you know, like-

[00:28:28] Kyle 2: Yeah ...

[00:28:29] Taylor 2: and I think about that, um, a lot that's like, you know, it's, uh, the old Malibu beachfront property.

[00:28:34] Taylor 2: Like, when's the best time to buy a Malibu beachfront property? Well, it was yesterday, and the second-best time is right now.

[00:28:39] Kyle 2: Yep.

[00:28:39] Taylor 2: So what should you do- Yeah ... in light of that? And I think that's the- Mm-hmm ... only tension that I feel with the, like, step, stair step, is that you have to be really confident that the market will yield that opportunity and possibility for you in the future.

[00:28:50] Kyle 2: Yeah. I think that's fair. Um- I think my, my only, like, immediate response to that is that if you believe that the only time to get it now is now-

[00:28:58] Taylor 2: Yeah ...

[00:28:59] Kyle 2: it almost kind of shows like you have a lack of belief in your business- Totally ... in the future, and maybe you're not... The other thing is, like, can you sustain it?

[00:29:05] Taylor 2: Totally.

[00:29:06] Kyle 2: I think being able to sustain something is really important.

[00:29:08] Taylor 2: Do you think... So as you look at your business-

[00:29:10] Kyle 2: Yeah ...

[00:29:11] Taylor 2: it's 2030.

[00:29:12] Kyle 2: Yeah.

[00:29:14] Taylor 2: What is the revenue mix between rings, belts, and unknown? Percentages.

[00:29:20] Kyle 2: I think it's probably 20 rings, 30 belts, 50 unknown.

[00:29:24] Taylor 2: Okay.

[00:29:25] Kyle 2: So- Because I think this is the... You, you can't...

[00:29:27] Kyle 2: Everything either grows or it dies.

[00:29:28] Taylor 2: Yeah.

[00:29:29] Kyle 2: Doesn't have to grow at a 200%- Right ... but you gotta be moving towards growth. And so I think that's the-

[00:29:33] Taylor 2: I think, I think that's where when I think about what brands are then... And I think, I don't know if you saw Sean's tweet about this the other day, like- I'm not on Twitter

[00:29:40] Taylor 2: just yesterday. Oh, you're not? Yeah. Okay. Wow.

[00:29:42] Kyle 2: I hear

[00:29:42] Taylor 2: I should be on. Are you a, are you an alien from another planet? Yeah. What does that mean? Um, no, the, the idea is just then that, like, what is a brand if it's true that your future growth won't come from anything you currently have?

[00:29:54] Kyle 2: Mm.

[00:29:54] Taylor 2: Like, what are you?

[00:29:55] Taylor 2: Like, and the idea, you're really a platform- Right ... for something to exist, but the problem with those products and what the hard thing about e-comm is that if those things don't compound and have network effects such that they expand over time-

[00:30:07] Kyle 2: Right ...

[00:30:07] Taylor 2: then, like, your, all of your future growth is, like, yet to be solved.

[00:30:10] Kyle 2: Right.

[00:30:10] Taylor 2: Like, you have to, you have to in your head come up with some new way in which 50% of your revenue is gonna exist four years from now.

[00:30:17] Kyle 2: Yeah.

[00:30:17] Taylor 2: It's a big task. So I think that, like, that's the only tension between... Like, now what happens is that I think you develop the confidence and the mechanism by which you can discover those things.

[00:30:27] Taylor 2: Sure. And so, like, you- Yeah ... become more sure that you'll be able to solve the problem- Yeah. Once you see it more ... even though today it's an unsolvable. Yeah. 100%.

[00:30:32] Kyle 2: Yeah.

[00:30:34] Taylor 2: Um, awesome, man. Well, what else? Any other Q4 tips? So you're gonna spend, you're gonna keep the sale late. Mm-hmm. This is gonna be, you have all this pent-up demand.

[00:30:42] Taylor 2: You're gonna not spend as much on Meta. You're gonna pump-

[00:30:44] Kyle 2: Other channels ...

[00:30:45] Taylor 2: Remnant TV. Any other channels you like a lot?

[00:30:47] Kyle 2: YouTube.

[00:30:48] Taylor 2: Okay. Really?

[00:30:48] Kyle 2: I like long-form

[00:30:49] Taylor 2: video. Week of?

[00:30:50] Kyle 2: All year.

[00:30:51] Taylor 2: Really?

[00:30:51] Kyle 2: Yeah.

[00:30:52] Taylor 2: Interesting.

[00:30:52] Kyle 2: I mean, it's less responsive than Meta, right? Yeah. You're not gonna ramp the same way as a percentage, but just in general, like, that's what we're betting on.

[00:30:57] Taylor 2: What are you using for measurement for YouTube?

[00:30:59] Kyle 2: We don't use any measurement tools.

[00:31:01] Taylor 2: This guy's vibes, bro.

[00:31:02] Kyle 2: Except for- Everywhere ... except for post-purchase survey.

[00:31:04] Taylor 2: Wow.

[00:31:04] Kyle 2: Yeah.

[00:31:05] Taylor 2: So the only thing you make all your media decisions on, post-purchase survey.

[00:31:10] Kyle 2: And gut, yeah.

[00:31:11] Taylor 2: And gut. What does your gut tell you?

[00:31:13] Kyle 2: My gut tells me better attention is better than short-term attention, and you talked about this a little bit, the long-term halo effect we see from things like YouTube and TV- For sure

[00:31:21] Kyle 2: are far and away better than- For sure ... some of those others. So-

[00:31:25] Taylor 2: What

[00:31:26] Kyle 2: if- ... this is like fundamentals of

[00:31:26] Taylor 2: marketing

[00:31:27] Kyle 2: true ...

[00:31:27] Taylor 2: what if, what if your guts disagree, like people internally? Whose gut gets the win?

[00:31:31] Kyle 2: Whoever's accountable for the outcome.

[00:31:32] Taylor 2: Okay. Is that- Yeah ... you?

[00:31:34] Kyle 2: Yeah.

[00:31:35] Taylor 2: At the end of the day. Yeah. So it's just your gut.

[00:31:36] Kyle 2: I mean, we get by. Like, I'm not a-

[00:31:38] Taylor 2: What happens if you die?

[00:31:41] Kyle 2: Well then maybe we get a measurement tool.

[00:31:42] Taylor 2: Yeah.

[00:31:42] Kyle 2: I don't know.

[00:31:43] Taylor 2: All right.

[00:31:43] Kyle 2: I mean, I, I'm open to being wrong on these things. I just think- No ... sometimes we like to overcomplicate- For sure ... decision-making. The question is like, okay, if you have a budget and you're spending 100% on direct response- Yeah

[00:31:52] Kyle 2: meta, is that better or worse long term than taking 30% and putting it towards longer term attention, brand recognition? Like-

[00:32:01] Taylor 2: Yeah. I,

[00:32:01] Kyle 2: I- And the answer's probably better ...

[00:32:02] Taylor 2: I think what happens is, and this is why Barfi probably has an issue with these, is that I think that there are Rick Rubins and there are Kyle Yeomans that actually-

[00:32:12] Kyle 2: And Rick Rubin used in the same sense as him before, but-

[00:32:13] Taylor 2: Well, you brought it up earlier, so I think it's a fair example.

[00:32:15] Taylor 2: That like your intuition based on your ability to synthesize information and your experience in the industry actually leads you to really good decision-making. Um, and you are gifted in that way. But what happens or what is very hard is for that to be replicable for anybody else. Yeah. I think that's

[00:32:33] Kyle 2: fair.

[00:32:33] Taylor 2: Um, and the second that you, the decision-maker moves to somebody with worse intuition, then the idea that we're gonna use intuition becomes risky.

[00:32:41] Kyle 2: Yeah. Really bad decision.

[00:32:42] Taylor 2: Yeah.

[00:32:42] Kyle 2: Yeah. And so- I actually, I actually really agree with that. Yeah. I haven't figured out how to solve it though.

[00:32:45] Taylor 2: No, I, I think I, well, you don't have to.

[00:32:47] Taylor 2: That's the good thing is because you're Rick Rubin, right? Like, so he doesn't need to go build a system for deciding what good music is because-

[00:32:53] Kyle 2: He knows ...

[00:32:54] Taylor 2: he f- he can intuit and he has a long history of proving that that's true. Um, so your history is being built and you're doing it well, and so you get to use that system But

[00:33:03] Kyle 2: is that confirmation?

[00:33:04] Kyle 2: Like, do I feel like it's good enough so I... Does that make sense? Like, I'm open to being challenged on the, on the gut honestly.

[00:33:08] Taylor 2: Well, I think good enough, again, is also up to you to decide what that means. Yeah.

[00:33:12] Kyle 2: That's true too.

[00:33:12] Taylor 2: And then how we're gonna teeter into the philosophical here, which last time we were together we had some drinks and did that.

[00:33:17] Taylor 2: What are you doing for

[00:33:17] Kyle 2: dinner? Let's

[00:33:17] Taylor 2: do that. Yeah, exactly. But, but, but, but really, and I think this is, this is... I think that most businesses live in the chaos and ambiguity of the owner's desires. Um-

[00:33:26] Kyle 2: Yeah ...

[00:33:26] Taylor 2: and so the fact that you're satisfied actually can build an organization that it is self-satisfied.

[00:33:31] Taylor 2: And so the external opinion of whether that's good or not doesn't matter, right? Yeah. It's like if you guys are- It's

[00:33:35] Kyle 2: irrelevant.

[00:33:35] Taylor 2: Yeah. Yeah. If you're satisfied with the outcome and the system that you're getting, then the system is good.

[00:33:39] Kyle 2: Yeah. '

[00:33:40] Taylor 2: Cause I like to say that your out- your system is perfectly designed for the outcome it's getting.

[00:33:43] Taylor 2: That's true. And so if, if it's producing what you want, then, then I don't think there's any reason for change.

[00:33:47] Kyle 2: Large is profit and the ability to sleep at night.

[00:33:49] Taylor 2: That's

[00:33:49] Kyle 2: right. It's like both those are true.

[00:33:50] Taylor 2: Then great.

[00:33:51] Kyle 2: We'll wanna grow faster as soon as those two things are true for a long period of time.

[00:33:55] Taylor 2: Yeah.

[00:33:56] Kyle 2: But that's the tension that kinda lives in every founder business, I think.

[00:33:58] Taylor 2: I think the, the only risk is if you are in a position enough to be committed long term, because in the absence of the yeoman, what hap- in the absence of the Ruben, how does that system persist? Um, and I think that would be the only risk.

[00:34:13] Taylor 2: But if you're-

[00:34:14] Kyle 2: Well, what would you say the answer is?

[00:34:15] Taylor 2: Well, I, for me, I like to think of the idea that the organizational decision-making framework is devoid of the individual, of any individual, and that the individuals all submit to some externality that we're using to define it. Um, now I say that as somebody who would love to just say, "'Cause I said so."

[00:34:35] Taylor 2: Yeah, yeah. It's easier. Yeah. And it's way easier. Yeah. It's way easier. Way easier. Yeah. But part of it is I have actually become very acutely aware of how often I'm wrong. Yeah. And it, like at a scary level.

[00:34:44] Kyle 2: Yeah. I'm wrong all the time too.

[00:34:45] Taylor 2: Yeah. At times when I was really, really convinced-

[00:34:47] Kyle 2: Yeah ...

[00:34:48] Taylor 2: that my gut was right.

[00:34:49] Taylor 2: And so I think probably it's my own insecurity about that that's developed over time to say like, how do I, what is it like to build a, a gut check for myself? Because I'm actually interested in trying to move closer to reality as much as I can, and so what are the best ways to do that? Um, and again-

[00:35:04] Kyle 2: Do you think there's a competitive edge in people then, or no?

[00:35:08] Taylor 2: I think it's really hard to know if you have it. I think if it exists, it's like to prove that to yourself would be really hard. And I think that more and more, I, I find that as organizations, as people leave them, they just evolve in ways that can render them- That's very true ... replaceable- Yeah ... very fast.

[00:35:27] Taylor 2: Um- Yeah. And

[00:35:27] Kyle 2: I think I'm super replaceable- Yeah ... right? 'Cause you could replace a lot of, I mean, take an MMM or go do a measurement tool, you could- Right ... get the same allocation.

[00:35:33] Taylor 2: Right.

[00:35:34] Kyle 2: I think the thing I've, I've wrestled with a lot, though, actually, this is philosophical-

[00:35:37] Taylor 2: Yep ...

[00:35:37] Kyle 2: is you have two brands that do the same thing.

[00:35:39] Kyle 2: Yep. They sell the same product. They've made a lot of the same actual internal decisions. Why does one succeed over time and the other one doesn't?

[00:35:45] Taylor 2: Well, I mean, I think there's lots of dimensions that could be the answer. And I

[00:35:48] Kyle 2: think- I just mean, like theoretically, right? If you, if you-

[00:35:50] Taylor 2: I think the actual, that the execution is the underrated asset there.

[00:35:53] Taylor 2: Yeah. It's not the information. Right. I, I think that most people could have information and not act on it at all. Like, if you go- Yeah ... and, and I tell you this as running incrementality studies for brands all the time, is that I could show you that your thing is bad and watch nothing happen over and over and over.

[00:36:06] Taylor 2: That's a very good

[00:36:07] Kyle 2: point. Yeah.

[00:36:07] Taylor 2: So I think that- Makes sense ... what I find is that the best organizations, they have this deep intimate connection between belief and behavior-

[00:36:13] Kyle 2: Mm-hmm ...

[00:36:14] Taylor 2: such that as belief changes, their behavior does too. Yeah. In the worst organizations, those things are disassociated, where whatever they say they believe, they don't act like it.

[00:36:21] Taylor 2: Right. So I have my, like I think I would call it organizational integrity, is that there's high alignment between the things we say we believe and the things we do. Yep. And that the beliefs actually can become secondary to that being true- Mm-hmm ... because there is no, I'm not a big like big, uh, uh, capital, um, T truth guy where there's like a singular idea that could be right.

[00:36:42] Taylor 2: There's lots of ideas that are right. And it's more important c- can you actually move action in connection to

[00:36:47] Kyle 2: those. Just like alignment to those.

[00:36:47] Taylor 2: That's right.

[00:36:48] Kyle 2: Yeah.

[00:36:48] Taylor 2: And so I think you, you, it sounds like you also have that too with the things you believe, where you don't sit around wondering all day if what we believe is true.

[00:36:55] Taylor 2: We believe it and we do it. And I think that's really powerful.

[00:36:58] Kyle 2: That's an interesting take, though.

[00:36:59] Taylor 2: Yeah.

[00:36:59] Kyle 2: That makes a lot of sense.

[00:37:00] Taylor 2: Um-

[00:37:01] Kyle 2: Hmm ...

[00:37:02] Taylor 2: well, there you go, guys. Yeah. Welcome to E-commerce Roundtable Live. Come join us for, well, we're gonna have a cocktail, and who knows where we'll end up, uh, later. But Kyle, if you're not on X, where, how do we follow you?

[00:37:11] Taylor 2: How do we gain- You don't ... more wisdom from you? You don't. Can we, can we... Do you have a-

[00:37:15] Kyle 2: I have a

[00:37:15] Taylor 2: LinkedIn. Okay. Yeah. You, you posting thoughts on there regularly? I

[00:37:18] Kyle 2: post, I write an article a week now. Okay. So at the beginning of this year I started writing.

[00:37:21] Taylor 2: What, what, okay, that's cool.

[00:37:22] Kyle 2: Just what I'm seeing- Have you got a Substack in the works?

[00:37:24] Kyle 2: in the business. Uh, I started on Substack, then I made my own site. So I have a subscription.

[00:37:27] Taylor 2: Okay. Are we going like 3,000 words, 30 words? What are we doing?

[00:37:29] Kyle 2: It just depends. They're like three to six-minute reads. Okay. They're basically just weekly pondering. Sometimes it's what we're seeing in the business or things we're doing.

[00:37:36] Kyle 2: Other times it's just like, "I wonder what the future of work will be-

[00:37:39] Taylor 2: Oh,

[00:37:39] Kyle 2: okay ... when AI's take over." You know? Great. It's all over the place.

[00:37:41] Taylor 2: So, and that's on LinkedIn.

[00:37:42] Kyle 2: Yeah. And then, I, it's kyleyoman.com. Yeah. I just made a site with a little opt-in for a newsletter.

[00:37:47] Taylor 2: Hey, there you go. He said you couldn't follow him, but he's got the newsletter.

[00:37:50] Taylor 2: Get there, get engaged in his thoughts.

[00:37:52] Kyle 2: Yeah

[00:37:53] Taylor 2: Doing really cool things at Groove. Congrats, man. Thanks for having me. Congrats on, uh, enduring the market and crushing me and surviving as a competitor in the silicone ring

[00:38:02] Kyle 2: space.

[00:38:04] Taylor 2: I don't

[00:38:06] Kyle 2: think

[00:38:06] Taylor 2: I even knew you at the time. Um, and good luck tomorrow on your speech.

[00:38:06] Taylor 2: Thank you. And you guys will be- You already crushed it today. Thanks, dude.

[00:38:08] Kyle 2: Yeah.

[00:38:08] Taylor 2: We'll, we'll be, uh... You can-- His speech will be on YouTube, all the commerce roundtable follow-up docs. Um, so make sure you check it out, and go crush Q4.

[00:38:17] Kyle 2: Thanks for coming in, dude. Good luck. Thanks. Appreciate it.