Episode 61: How To Build a Profitable Direct Response Ad Budget of $1M/Month w/ Evan Tardy From Dr. Axe

This week, Steve speaks with Evan Tardy, employee #1, from draxe.com. Evan built a profitable direct response ad budget of $1M/month and landed draxe.com on the Inc. 500 list two years in a row. Listen in to this week's episode to learn how to go from 0 to 2X, 3X, and 5X year over year revenue growth.

Episode Transcript — How to Build a Profitable Direct Response Ad Budget of $1M/Month w/ Evan Tardy from Dr. Axe 

00:00 Speaker 1: You're listening to The Spend $10K a Day Podcast brought to you by the performance marketing experts at MuteSix. This is your source for cutting edge insight into the world of online advertising from the team with more Facebook case studies than any other agency on the planet. Here are your hosts, Steve Weiss and Stewart Anderson.

 

00:26 Steve Weiss: Hi, everyone. Welcome back to the Spend 10K a Day podcast. Today we have an incredible guest, Evan Tardy, who's president of Dr. Axe, probably one of the fastest-growing brands on Facebook. They're one of the best at doing longer form content on Facebook that turns obviously into acquisition. They're really good at content acquisition, and I'm really excited to pick Evan's brain and really share some amazing insights with all the listeners today. Evan, thanks for coming on, man.

 

01:00 Evan Tardy: Awesome. I'm glad to be here and, yeah, happy to be part of the podcast and hopefully share some valuable insights with your audience.

 

01:09 SW: Cool, man. First off, just tell us a little bit about yourself. Before we get into Dr. Axe, tell us a little about your history, your background. I think it's really important for our listeners to understand how you got into this space. It's interesting, 'cause I heard you speak at Ezra Firestone's Blue Ribbon Mastermind originally.

 

01:25 ET: Cool. Yeah. For me, personally, I come from a long line of entrepreneurs. My granddad left the family farm to go start a company. And my dad took over that company later on, and then my dad's an entrepreneur. I started my first business when I was 16, and it was a mobile car wash, and so I'd put this 750-gallon tank of water on the back of a trailer, but the trailer was actually... [chuckle] It was actually weighted for a truck, which is normal, right? But this is a massive water tank weighted for a truck. But I had an old school Caddy, [laughter] That I put a hitch on, and...

 

02:14 SW: That's funny.

 

02:15 ET: So, all that weight was on the back of that hitch, and created this low rider, but I would roll into school like that, dragging and scraping over the speed bumps.

 

02:23 SW: You'd be surprised. Those Caddy's are pretty strong. They got some torque, those old school Caddys.

 

[chuckle]

 

02:30 ET: It was a tank, man. Yeah. I learned early on if I wanted a new pair of shoes or something above and beyond, or something special, that I would have to earn it myself. Entrepreneurism is kinda in my DNA. I went to school for advertising, and small business is always just something I'm really... Have been passionate about. And as I was graduating, I got introduced to Dr. Axe. And at the time, he was running a healthcare clinic here in Nashville and his website, draxe.com, was really more of a side project, and was really a way for him to... He's huge into nutrition and wellness, and our whole brand is about empowering people to really transform their lives using the power of nutrition and food, and these holistic timeless principles. And so that's what his clinic was all about, and Dr. Axe is... He's a close friend and I call him Josh, but he's a person who's really passionate about nutrition, and so that's something that... He would print out these articles and hand them out to all of his patients that would come through the clinic.

 

03:50 SW: Evan, we missed out on a key tidbit of information there. For all listeners out there, Dr. Axe, his real name is Josh, just FYI.

 

03:57 ET: His real name is Josh, that's right. [laughter] So, he was handing out these printed articles, and his patients would ask him, "Hey, I'd love to be able to send this... Do you have this online somewhere or in an email I could send to friends and family that aren't in Nashville?" And so he started posting it online. I think his site had about 300, 400 visitors at the time when he and I first met, 300, 400 visitors per month. And so he and I met, and he shared the vision with me about where he wanted to grow the brand and the site. And I spent some time researching some of the stuff that he had already put out, and I was just really inspired by what he had already done and really the mission that he was on. I remember during our first phone call, he had said, "Have you... " He asked if I had read "The 4-Hour Workweek" and then another book by an obscure, no name wine enthusiast and marketer at the time, known as Gary Vaynerchuk.

 

05:05 SW: An obscure wine enthusiast.

 

[chuckle]

 

05:07 ET: Yeah.

 

05:08 SW: Boy, his brand has grown a little bit since then, just a tiny bit.

 

05:10 ET: A little bit, yeah. And so he asked if I had read "Crush It," and I called him back the next week and I said, "Hey, listen, I've read both those books. I haven't done the stuff in there yet, but I know I can figure it out. And if I have to stack chairs to be a part of what you're doing, I'm in. Let me know." And so he said, "Okay. Well, why don't you call me when you get to town." And so a month later, my wife and I moved to Nashville and I called him up, and I'm like, "Hey, I'm here. Let's go." And he was like, "Okay. Well, why don't you come over on Monday, Monday morning, and we'll talk." And so I brought my laptop over and he made me these... He's famous for his gluten-free blueberry pancakes, and so he made me some pancakes.

 

05:53 SW: Oh, it sounds amazing.

 

[chuckle]

 

05:54 ET: We talked for a little bit. And he slid over a piece of paper across the table, and I was thinking it was a job offer. And I lifted it up and it's the Wi-Fi password.

 

[laughter]

 

06:09 ET: And so...

 

06:10 SW: "What's this? Oh, it's Wi-Fi. Damn it."

 

[chuckle]

 

06:14 ET: That's how we got started, man. And so, yeah, from his kitchen table, and just off the laptops and then shipping product out of the garage. That was about eight years ago. And to this day, we've grown a lot. We tried a lot of stuff, thrown a lot of stuff against the wall. We'll get into some of that stuff that's worked for us, I'm sure, in this interview, but we made a ton, a ton of mistakes in the early days. But one thing I've always really appreciated about Josh is that he's a big advocate in creating space to make mistakes, but learning from those mistakes and then getting better. So selling the...

 

06:57 SW: What were some of the mistakes that you guys would make that you could stress to other listeners and say, "Hey, this was epic. We learned so much from this, from doing e-commerce of scale, building content around... " Tell me more. I'd love to pick your brain on that.

 

07:12 ET: Yeah, absolutely. One of our first ideas was... I remember someone saying... We were slowly growing an email list, and I remember someone saying, "How are you monetizing your list?" And I was like, "Mono... What?" [laughter] We didn't even know some of these. Me, I couldn't have...

 

07:33 SW: Those big internet marketing words. "You don't know what monetization means?"

 

[laughter]

 

07:39 ET: I was just willing to jump in with both feet, figure it out, and not know what some of these big things meant. And Josh, in the same way, has been really empowering. One of our first ideas was to model... Dave Ramsey is based here in Nashville, down the street from us, and one of our first ideas was we're gonna model this... He had a program called Financial Peace University, and they had been really successful selling it in churches. And it's like a 12-week program. You have a coordinator and they bring people together and they meet once a week, and a really, really successful program. And so we thought, "What if we created a similar thing modeling that, but it's the health university or whatever?" And so we called it the Real Body Revolution, and we spent a lot of money on getting it filmed and created and had a full day workshopping. It was six one-hour sessions that Josh taught each of them, and really in depth, really great content, but our idea for selling it never really clicked. And so we were gonna turn it into a physical thing and try to sell them at churches or let it be a corporate wellness program and try to sell them to big corporations.

 

09:02 ET: And pretty much as soon as we had finished creating that six-DVD set physical program, there was a partnership that we were considering, and because of that, they already had a similar type of program, a corporate wellness program. And so we decided we're not gonna sell that. Literally, we had bought a thousand of these DVDs and they literally are collecting dust in the garage. And we're just looking at these things, like, "Man, there's gotta be a way to make this thing work." And so one of our first... So that was an early mistake. We kept learning, and Josh and I were collaborating and brainstorming stuff. One thing that came up was just the power of using webinars to sell programs. And so, we spent a couple of weeks setting up a sales page and basically ripping off of this DVD, ripping it and putting it into a little Kajabi online membership program and all this great content that... We hadn't been able to sell the physical, but we thought maybe we could sell a digital thing. And so we put it all up in my Kajabi and downloaded like a little go-to webinar, the little app. And I think it was $50 a month. Everyone was like, "All right. We can afford that as long as we cancel it next month, so it's not ongoing."

 

[chuckle]

 

10:26 SW: That's funny.

 

10:27 ET: And so we just scrapped all these pieces together and put together a little sales page and sent out a little email and said, "Hey, I'm doing this webinar. Get on it." This was our first webinar, and we had no idea to even be nervous about the tech not working. It was...

 

[chuckle]

 

10:44 SW: Rule number one. If you're doing anything with tech, make sure the tech works. If you're communicating with your customers, if you're building a content business, make sure that whatever you're doing to communicate with the people is actually... It's a great lesson.

 

11:00 ET: Exactly. Yeah. We had no idea to even be nervous. We just sent an email and expected people to show up. And fortunately, we put together the whole sales page and then they buy it, they go here, and they get to log in and all of that. And so Josh did the webinar, and then at the end of it he said, "Hey, if you wanna check out this program, go to the sales page," and he sent out the link. And I remember I used E-junkie. I think E-junkie was $5 a month at that... I think it still is. I don't know if they've ever...

 

11:32 SW: Yeah, I remember that. It's a long time. Old school.

 

11:35 ET: Old school. I was refreshing, drag to refresh, drag to refresh as soon as the webinar was over, and we saw a couple of sales came in and they're $100 a pop. And I was like, "Wow, this worked."

 

[laughter]

 

11:48 SW: Big surprise.

 

11:49 ET: 10 sales, 20 sales, 30 sales. And within the course of an hour, we made over 100 sales of this $100 program, and that was the moment, for me at least, when the light bulb went off and I thought, "Wow, this is unbelievably powerful." And now, if we could figure out how to get more people on a webinar, [chuckle] and then get more people to pay a little bit more for a program, we can start to wedge a space in this profitable offering. And so that was an early failure that really turned into a big paradigm and pivotal shift.

 

12:31 SW: Understand that the information that you're producing is very valuable, that there's a dollar sign that you could put on the information that you're producing, that people will pay $100. Now the question is, will they pay $200, will they pay $300, and so on and so forth. Correct?

 

12:47 ET: Exactly. That's exactly it.

 

12:49 SW: Question, this is a good segue, tell us about Dr. Axe. Obviously Dr. Axe started as a content business. They're selling information on healthy living and really improving how you feel. I'm actually gonna be buying some of the collagen product. [chuckle] I'm on the intermittent fasting, so I'm very big into the health kick right now as well. But tell us about the evolution of Dr. Axe, 'cause obviously you guys started in that building an amazing name for producing content on feeling better and empowering others with health. But you guys have pivoted more from just the content game into doing a lot of e-commerce. And I think that's what's really interesting of how do you pivot from a content industry into e-commerce. Then number two, how do you use long form content to sell products at scale? 'Cause that's something... Facebook is very much about 15-second videos, and this and that, but I love businesses that have the very intelligent about using long form content.

 

13:50 ET: Yeah. Absolutely. Well, to quote the... I consider him the godfather in a lot of ways. It's GaryVee, he's famous for saying, "Give value, give value, give value, and then ask for business." So, for us, one of the ways that we give value... And all of us as marketers I feel like we should have it tattooed somewhere on our forearm that says, "People buy from brands they know, like and trust." And so how do you establish that know, like and trust factor, when it all comes back to giving value? Which is why I consider GaryVee one of the godfathers. If you followed his Wine Library TV efforts, he did over a thousand videos of just reviewing wine and just building a tribe and a following by giving valuable content. And so that's what we've modelled from day one. And our brand is a little bit different than his, which ours is more authoritative, educational, something that you can go to as a research-driven type of brand. But the same principle is still true is that we always look to lead with value.

 

15:01 ET: And so, for us, to come full circle... When I started, we had 300 or 400 visitors per month to our website. As we started trying and failing and figuring out SEO and really doubling and tripling down our efforts there, to this day, we do about 14 and a half, 15 million unique visitors to our website. We have a couple of Facebook pages, each of them over two million likes. And our email list is over two and a half million subscribers. The stats just go on and on from there. But for us, the pivotal piece about all of this or the foundational piece is that it all starts with providing value. And we do that in the form of education.

 

15:45 ET: And when I share about this, a lot of people ask, "That makes sense because you guys, it's kind of obvious, like a health-centered brand would educate on health and then also be able to sell health-oriented products. It's an obvious pair. But what if I don't have a brand or a company as obvious to do an educational type of content site? And so to that, I say... I get a text from my brother, who's in college, every week or every other week, and it's usually... He usually sends me a link to some viral, like, BMX video, snowboard guys jumping over... He's built up his own little thing, jumping over a roof. It's just crazy stuff, or jumping over Grand Canyon, epic Grand Canyon back flip. It's just super viral videos.

 

16:38 SW: But there's no value. There's no actual beyond...

 

16:42 ET: But here's the thing, all of them have one thing in common. They're all sponsored by Red Bull. I've seen them.

 

[laughter]

 

16:51 SW: It's the experience. It's the Red Bull sponsors experiences.

 

16:54 ET: Exactly. And so they are providing value in the form of entertainment. And so it doesn't necessarily always have to be educational. So I would say, if it's not a direct line for someone listening that... Your company, if it's not obvious what you could do to educate, maybe there's an angle that you could do that's more entertainment-based. That's just a little aside. But for us, some of the things that we've been able to find that really worked for us on the long form content stuff is... Our standard is... Again, we wanna give, give, give value, and so we have really, really high standards for everyone on our team, especially on the content team. We have about 25 members on that team, full time. We have researchers. We have a medical researcher. We have editors, staff writers, graphic designers, photographers, video editors that all spend a lot, a lot of time doing the work and then thinking about the work and how we can make it better and build on our playbooks. And we can dive more into some of the content specifics, but that's a little bit how...

 

18:08 SW: When you guys start marketing your content... So there's two types of things you're marketing. You're marketing for direct response and you're marketing content. How do you integrate your products into your content? Do you guys do a form of an advertorial? How do you integrate your content into direct response ads? That's always been really interesting to me, is you have the trend, "Here, we're not trying to sell you something. We're trying to give, give, give." How do you integrate the DR into the content?

 

18:36 ET: Yeah, that's a great question. The biggest thing for us is really capturing someone's attention. So whether it's on Facebook as a subscriber or their email address as an email subscriber, for us, we consider that a micro-conversion on the path to checkout conversion. But the best way for us to do that is by providing educational content and then attracting a large audience to our site, building up that authority and then, once they're on our site, creating really valuable lead magnets to give away in exchange for someone's email address. I'll talk about that real quick. There's two key points here. One is a buddy of mine, Nicholas Kusmich's... One of the things that he's really nailed, he talks about insight versus information. We are in the information age obviously. I don't even go to Google anymore. I don't know if anyone does. We just yell at Siri and Siri Googles things on our behalf, right?

 

19:45 SW: Yep.

 

19:46 ET: Or Alexa. We just shout at our phones and it does the Googling for us. So, there's no shortage of information. What people are looking for is insight. And the difference between information and insight is that insight is what do you do with the information to get a desired result? And so that's where you, as the expert or the brand, anyone listening, can stand in that insight area and really provide that. And that's really valuable. And for us, when we started doing ebooks and opt-ins and lead you in stuff to get people to opt in, we thought more is more. That was our MO. If we can just overwhelm them with quantity, then it's gonna be a no-brainer. We spent a lot of time and put together this really long, exhaustive overall health ebook, Overall Guide to Health. It was really high quality. I don't know if you're guilty of this, Steve, but I am. I'd say every, at least once a month, I download a new ebook that only collects digital dust.

 

[chuckle]

 

21:00 SW: Oh, yeah. Reality is there are so many books, you can't read every book. There's not enough time in the day to read every single thing you download. And I think that... I know where you're going with this. The volume... Saying you need content just because you need content is not a strategy, it's a waste of time.

 

21:17 ET: Exactly.

 

21:19 SW: Well, you guys have done really well, in my opinion. After Blue Ribbon conference, I read a lot of your stuff and it's not a volume play. You guys have very, very key insight and it's very applicable to people's daily lives. Even the products you guys market, they're applicable to reaching desired goals with health. And I think that's really interesting, and I think there has to be a correlation to... And this brings up my point of what I'm really fascinated with. There has to be a correlation to the content to what you're trying to sell eventually down funnel. Obviously...

 

21:54 ET: Exactly.

 

21:55 SW: You guys do really good at grabbing intent and getting emails from lead magnets and up the funnel, because you know that if a person is interested in a specific piece of insight, what's actionable is gonna be a purchase down the line. So maybe start thinking of... If you are creating a lead magnet and you have something even non-health and you wanna build a following and build trust and give, give, give, start thinking of insight that's gonna actually help make a buying decision maybe in there, 'cause I know you guys are really good at that. That's gonna influence. And the word "influence" always comes about.

 

22:32 ET: Yeah, absolutely. And a great example to get some of the creative juices going, if your audience wants to start trying this, is when we switched from the generic guide to all-encompassing health to... We had a thing at the time, this is a few years back, where we were talking about healing foods and foods that really promote health and wellness versus the standard American diet type of foods. And so we put together what we called the Healing Food Shopping List. It was literally two pages. There was not anything promotional in it. It was a checklist of foods that Dr. Axe approved that you could print that checklist out, take it to the grocery store, and if you bought the foods that were listed out on that checklist, then you knew you're safe, you're in the diet.

 

23:27 ET: And so it was that short and sweet insight that someone could download immediately and really get some value within the first two to three minutes of putting their email in and downloading the thing. And it's not this ebook that they say, "I'll get to that later," or, "At some point, I need to come back and read that." And then every time they think of it, they just feel guilty for having that thing on their to-do list that they've never gotten a chance to come back to, versus the Healing Food Shopping List, it was an immediate, like, "Oh, wow, there is value that... Because I was able to use this right away, there is a value exchange there."

 

24:04 ET: And so then, once we have their email, we provide value. And then you follow up with the ask. It's always very relative, relevant. And so as specific and relevant as you can make the offer, the better. That's kind of been part of our playbook for at least providing content, capturing the email, and then making relevant offers.

 

24:32 SW: Interesting. And how do you guys leverage Facebook and just paid ads along with your content space? So you're obviously direct linking to some of this content to generate top of funnel acquisition. You're trying to generate emails, trying to generate top of funnel while also trying to generate down funnel acquisition. How does this all integrate into a bigger picture like Facebook ads or overall acquisition strategy?

 

24:58 ET: Yeah, that's a great question. There are things for me that I would consider our four pillars. It's SEO, and our SEO is quality first. And the second would be social. For us, we focus on Facebook. And this strategy, everything we do could be applied to Instagram, Snapchat, Pinterest, doesn't matter what your social media channel of choice is in some regards, but we would much rather go a mile in one direction than a millimeter in a thousand directions. So, we choose one and really focus on crushing it before we move on to the next one. So for us SEO and content, social media Facebook, email marketing, and then paid advertising. So those are our four pillars. I've put together a growth chart over the last five years, and all four of those channels have grown at the exact same ratio.

 

26:00 ET: Now, there's been some other pieces of our business that have grown a little bit at a steeper slope and others that have grown at a lot less of a steep slope, but those four are almost on the exact same line when it comes to growth. And so, for us, it's really the four pillars, that "core de four" that has really... They all kind of feed each other, because if you have really quality, quality content to start with, then that gives you something really valuable to share on social media, and now you're building that trust all along the way. And then if you share that stuff on social media, you have the same epic high-quality content based on how people are engaging with that content on social, you take the best of the best and you plug it into your email. Now, you're able to provide on three different channels really high-quality content. Now, because of all of that good will, because of all of that know, like, and trust, what it all comes back to, that you've built up with an audience, now you have a self-fulfilling prophecy in a lot of ways when you come back to target that audience with paid advertising 'cause you've done all the legwork upfront to create your own...

 

27:03 SW: It's like seasoning the audience.

 

27:04 ET: Hot and warm audiences. Exactly.

 

27:06 SW: Preparing them to make a purchase...

 

27:07 ET: Seasoning, there you go. That's exactly...

 

27:09 SW: By bringing value to them. They're a lot more open to receiving your message than, say, a cold audience. And that's really interesting, 'cause I don't think a lot of... A lot of DR advertisers aren't really focused on the long tail. They're not willing to make that big investment top of funnel to really drive people to content. And it's hard because most advertisers that I've worked with, that we've worked with over the last four and a half years of running an agency, it's really hard. Their question is, "Can you quantify our top of funnel work?" "Can you say, Steve, what is the long-term value of us driving a lot of traffic to content and making content a big part of our acquisition strategy?" And sometimes it's really hard. And I guess my question to you is how do you quantify the work that you're doing on your top of funnel? You are driving a lot of Facebook traffic to some of your best posts, that you're bringing value to people and go to convert them down funnel. How do you quantify the work that you're doing to season customers on a specific channel, say Facebook?

 

28:14 ET: Yeah. Attribution, right, is always the challenge. But for us... One of the easiest things is to look at that growth chart of those four pillars growing at an aggressively high rate all in tandem with each other over the last four years. That's one way and it's less of a direct answer, but it's more of how do we continue to reinvest internally into content? Well, it's because of that growth on all four of those channels. And then, for us, we look at... Email marketing is our number one revenue-driving channel. But how do we grow our email list? Well, we grow our email list by producing super high-quality content, getting it to rank in Google, and then getting people to our site and then they opt in. So, all the way back up to top of funnel, that's where we justify that expense and that investment is that we know ultimately that's one way we're gonna drive email opt-ins.

 

29:23 ET: I'll share a different story, a little bit of sequential messaging that we've done on Facebook that was probably a good case in point of some of this that we're talking about, this investment in providing quality first. I do think it's tempting as marketers, who have a budget or a quota to meet, to really look at Facebook as a way to drive immediate return. And it's month over month of playing the Facebook game.

 

29:58 SW: Yep. Yeah, that game is...

 

[chuckle]

 

30:01 ET: Right? But let me share a story. And this might help some people who are on the fence in trying to figure out should they invest in more organic and some value-based content, and then the DR, 'cause I'm a huge proponent of both. So, we put together... We had this $1,500 program, it was an online institute where we're really going deep teaching people about essential oils and how to use them, and really, really deep education on a $1,500 program. So we spent a ton of time putting this together, teaching it. This is all taught by Dr. Axe, and really, really great program.

 

30:43 ET: Well, what we did was we started out with what I call Facebook 1.0. And Facebook 1.0, I think, is what... Facebook in Q1 of 2017, they had over $4 billion revenue, and it's because of Facebook 1.0. You have so many massive tools at your fingertips in Facebook advertising that if you just spend time on targeting alone, you are able to drive profitable ads. Then, if you spend more time on iterating creative and dialing in your audiences and doing look-alikes, and all of that stuff that you can do, you're gonna drive profitability. The more hours you put in using what Facebook has, the more you're gonna get out of it. So Facebook 1.0, I think, it's why Facebook did over $4 billion Q1 last year. That's why their platform is so powerful, all of the targeting that you can do.

 

31:38 ET: But a lot of people spend most of their time on targeting and then at creative. So they'll identify who needs to see this offer, and then show them the offer and drive them to a conversion, which works. We do it really well. We drive a lot of profitable revenue by doing that. We still do it to this day, and it really works.

 

31:55 ET: Now, Facebook 2.0, which I think you're gonna start seeing a lot more people doing this over the next 12, 18 months, and it will have a shelf life on it. But I think Facebook 2.0, at least what I'm calling it internally, looks a lot more like sequential messaging, and it looks a lot more like what Purple Mattress is doing and a handful of others that have really dialed it in. Now, if you're not familiar with the Purple Mattress campaign, what they did was they put together this five to seven-minute video of this Goldilocks character, and it's kind of silly and she's talking about... They invented some egg test to evaluate your mattress, and it's kind of over the top. And so I saw this ad in my newsfeed, and it had over a hundred million views. I was like, "Man, this is a good video, but it's not that good. [chuckle] It's not a hundred million organic viral views good. It's good but... " Well, I'm like, "Surely there has something going on behind this." And so our team, we all started reverse engineering and trying to ask and figure out what's going on.

 

33:03 ET: Well, when we did this launch of this $1,500 program, part of our advertising budget was to test and reverse engineer what we thought might be our theory was behind the Purple Mattress campaign. So what we ended up doing was, we did Facebook 1.0 which was we would upload our buyer list or relevant visitors to our website who have looked at essential oil articles, and we would target them straight to the offer. And that was profitable. That was a CPA of about 300 bucks for a $1,500 program. So, that's great. I'll take it all day long. It was part of a three-week launch, and that was really great.

 

33:44 ET: On Facebook 2.0, what we did as part of our experiment was we put together a five to seven-minute video of Dr. Axe, and he's on a beach in a different setting than what we normally put out. And he's talking about... He's hitting on inspiration and he's hitting on education and how to become an essential oil coach. For the first 85% of the video, 90% of the video, it's all about education and giving people tips that they can take right away and start using right away. And then the last bit of the video, he basically says, "Hey, listen, if you want to learn more about everything I'm talking about right here, click the link below. I'm doing a webinar. Go hop on the webinar. And we'll go even deeper into all of this stuff." So, we did that and then we took people from that video and drove them over to that webinar. And then what we found is we started targeting people who had watched more than 10 seconds of that one video. The CPA was $150.

 

34:47 SW: Wow. Interesting.

 

34:48 ET: And so half of what Facebook 1.0 just kinda direct targeting and a direct offer was. And so, for us, we really started scaling that and that was part of a $3 billion launch within three weeks. And that Facebook 2.0 was one of the biggest drivers of the success behind that launch. And so what's really cool about that... That was really great and that video now has over 14 million views on it. But if you scrolled down a little bit, under that video, there were over 30,000 shares of that video, which is essentially an ad. And so, you look at major food brands like Skittles or Snickers, and these guys have 30 million likes on their Facebook page, but all they do is talk about themselves. They talk about Skittles. Here's a picture of Skittles at the park. And here's a picture of a Snickers billboard at the Dallas Cowboys Stadium. Who cares? [chuckle] And you look at the engagement on those posts and they have... You're talking about a page with 30 million likes or subscribers, and these posts have three, four, 10 likes on these posts.

 

36:06 SW: It's a really good case study. That's amazing. Its a really good case study of... Maybe it's just a bigger picture of arbitraging intent and really building trust. I think that's literally... The funnel for this court, for this CBD is getting people to watch... It's such high conversion rates from getting people to watch over 30 seconds, correct, on a long form content.

 

36:31 ET: Exactly. Yep, exactly.

 

36:34 SW: Maybe that could be a great model for if you do have an expensive high AOV product is really setting your conversion objectives top of funnel on both Facebook and Instagram to drive traffic, and tell Facebook to optimize around people who are most likely to engage for X amount of times. Maybe it's time-based audiences 'cause... I know it's working really good for you guys 'cause now you're driving a super seasoned consumer into your funnel who's really invested. Maybe the bigger picture is the more you can get consumers to invest time into you, the more likely they are to buy your product.

 

37:13 ET: Yeah. That's exactly it. And so you start with showing them a really high value piece of content that's educational, but exactly like what you're saying, Steve, you're arbitraging intent. You're educating them, but you're not just randomly educating them. For us, we're educating people who cared about essential oils and were curious about how to learn more about essential oils. So we start there by giving value to those people, and we only show the direct response ad to people who engage with that initial five to seven-minute video. So, they essentially have to raise their hand, now the volume's lower but the quality is so much higher.

 

37:56 SW: It makes sense. The question is, how do you do this at mass scale? Are you doing this across all your products? Does it only work for high AOV products? Can you do this to drive people into a funnel to purchase everyday items and really shove... Do a two-minute video on value of an apparel brand? I guess the application of doing long form content is really interesting to me. I think, as a company starts exploring more and more and trying to season, make that customer experience a lot more synergistic with Facebook, a long form content is gonna be even bigger. But any other really cool examples of long form content? 'Cause this is just... All of our readers, I'm even gonna share this podcast with some friends who work at Facebook on the creative team, because they're all actively trying to learn about creative. They're trying to learn their platform of how consumers react.

 

38:53 ET: Yeah. Yeah. Definitely. On the long form piece, just to close the loop on the Purple case study, they came out of nowhere and, in 2016, basically it went from 20 million in revenue to over 115 million in revenue. And then last year they sold for over a billion. During that sweet spot of growth for them, they were running this campaign. [chuckle] I would say that's a guaranteed result, but that was the biggest driver of them being able to put their name on the map and then having a really, really massive exit.

 

39:33 SW: I think you bring up something really... I think the way we're painting the picture is, number one, give, give, give, give. Number two, create a long form piece of content that you're giving a lot and then you're running that as an ad. You're investing into bringing the most engaged people into your funnel. You're investing in people's time, we could call that. Number two, invest to get people's time and attention. You're telling Facebook, using the Facebook algorithm and telling them to optimize my campaigns around people who are gonna engage for a long period of time. Then once you have those long-term engaged audiences, then you're selling them products that they're most likely to be engaged, that they're most likely to buy from you as a trusted brand. That's the three pillars... Would you agree that's a great three pillars of long form content as a strategy?

 

40:29 ET: I think so. I think that's exactly it. You're creating awareness, brand awareness, and then product awareness, and then a call to action. And so whether you break that up over three different videos or three different pieces of creative, that they have to engage with one before they get sequenced to the next one, that's essentially the idea. For us, for that video, it wasn't three pieces. It was two. And it seems like Purple, from my theory, behind Purple, is that they broke it up into two as well, where it's that super high value, engaging... Again, their value was the entertainment aspect. Whereas our value in our five-minute, seven-minute video was educational and authoritative. But again, that's preferential. That's up to whatever aligns with your brand. But then, as soon as you watch that Purple video, you'll find that... If you go over to their Facebook page, it's everywhere. If you watch it for just more than 10 seconds... Pay attention to the ads that they're gonna start showing you, and they're gonna be ads that have way, way, way less engagement, and they're gonna be very clearly direct response taking you to a call to action. But they're not showing those ads to just everyone. They're showing that...

 

42:00 SW: Pushing people further along the buying...

 

42:02 ET: The viral video there really, yeah, exactly.

 

42:04 SW: It's really interesting. And I think, from a creative perspective, I don't know if we can call this a funnel. I think a lot of people love to refer to this as, this is a convergent funnel. I don't like... I think the word "funnel" is misused a lot in our business, Evan. It could mean 100 different things. I love it how we label this sequential messaging, 'cause that's what it is. It's a message. It's a massage that leads to another message. And the word "funnel" is very ambiguous, I think. It's very much like, does that mean a website, a web funnel, or a video funnel, or a convergent funnel? It's a word that's kind of anomaly. It can mean a lot of things, and I love just talking more about this... I know we've been on for a little while, but this sequential messaging of preparing a user through messaging, that's... We haven't even talked about leveraging Facebook Messenger. That's been a big win for us, is really integrating Facebook Messenger into our marketing campaign as a main form of communication with a large base of audience.

 

43:06 SW: But I love how you think, man, I gotta be honest. I talk to a lot of marketers and a lot of people in digital marketing, and everyone is an expert. I've been doing this alone. In nine, 10 years, it's all I ever done in my life, and I don't think I'm an expert. I go into each and every meeting with people and just say there's a lot of stuff I could learn. [chuckle] A lot of stuff that I'm not good at. I love how you think, man. It's too much to put down the table.

 

43:33 ET: Well, I appreciate it. I appreciate it. Yeah, I tell people I plan to retire when I'm 85, but until then, I'm gonna be continuing to learn. Yeah, definitely a life-long learner. And I think the thing is it's always changing, as you know. And running an agency and doing this for eight, nine, 10 years, you know that the tactic or the tool that you can really make work today or three months ago or six months ago is not gonna be the same tool tactic or way that you're gonna make it work in three, six months from now. But the underlying principles of giving value first... One of my favorite books is called "Scientific advertising." And I believe the book was written in 1904.

 

[chuckle]

 

44:26 SW: Wow, that's a amazing.

 

44:27 ET: And it's like Claude Hopkins, and he's, some consider, the father of direct response. And then he has another book, "My Life in Advertising." Those two together are... They're so amazing to read because the principles in there are absolutely timeless. He's credited with inventing the coupon. [chuckle] But these things that we still do and apply today. The tools are different. It's not a newspaper ad.

 

44:55 SW: It's marketing.

 

44:56 ET: It's Facebook, but it's marketing, and the underlying principles are just as true today as they were then.

 

45:01 SW: And I guess my frustration about the industry that I'm in... I'm in the internet advertising agency industry where I provide a service to companies, my frustration with the biz I'm in is that most of our competitors are selling an algorithm. They're selling a data way or that we're gonna do some data magic, and our system will optimize the bids, and blah, blah, blah, blah. And I think that takes away from the bottom line picture of that we're marketers. We understand the psychology, you can't hack the Facebook system, you can't do one... You can't tell Facebook to optimize this thing and magic is gonna happen. No. You have to get back into the weeds. You have to be a marketer. There's no hacks for the system anymore.

 

45:43 SW: And putting people through... Sequential messaging, that's marketing. That's senior billboard, getting your message on Facebook, searching for it on Google. I love that. That's what excites me about... I get purpose in marketing, 'cause I'm a psychology nut. I've personally read almost every psychology book on marketing. Robert Cialdini's "Psychology of Influence" had a big impact on me. And what I hate about my industry, and I know hate's a bad word, but I always tell people is don't buy the algorithm, buy the marketing, buy the messaging. All Facebook gives is just a way to transport a message. It's a messenger. You can send any message you want, granted that Facebook is cool with it, but... [chuckle] I stress that for all my listeners is, "Don't buy the algorithm, buy the message." Make that message look very native to Facebook. Don't let that message look different. People can see an ad, and they're gonna be pissed off.

 

46:43 ET: Yeah. I'm glad you brought up "Influence." Yeah, that book was pivotal for me as well. And I think one thing that... If someone's... I was guilty of it. I think a lot of people are. I think it's normal, but early on in the marketing career, I think it's tempting to go for the quick win or it's tempting to go for the latest blog post about seven ways to hack X, Y or Z. [chuckle] And it's fun to learn some of that stuff. But at the end of the day, "Influence" and some of these other psychology books, it comes down to empathy. And if you are marketing people in a way that you're not putting yourself in their shoes and really thinking through, like, "Who am I talking to, and how do they want to be talked to?" There's the golden rule of treat others like you would like to be treated. And I think the platinum rule is even better of treat others how they would like to be treated. And you really have to empathize and really put yourself in someone else's shoes, whoever you're marketing to, to really start to get inside their head and really think through what are the things that drive them? And I know this can... A lot of marketers talk about this, and it can almost be written off as cliche, but it is so absolutely true, that I think empathy and data-driven decisions, as a marketer, are definitely gonna set you apart as a marketer, and also helps set your brand apart.

 

48:15 SW: Totally. And I always piggyback on that, is that expectations of the message channel. I think that more and more we're starting to see... We're starting to itemize marketing channels into this discovery or intent. I think Facebook people is a discovery channel. Instagram is a discovery channel. You discover stuff on your newsfeed. But you might consume and discover two totally different things. You might consume your product on Amazon, you might consume and buy a product on Google, and I think it's really important when you think of doing your long-form strategies, remember that people are consuming this. You're not shoving it down their brain. This is people... [chuckle] You gotta make it so people can consume this. And really, if you're gonna do long form content, make a purpose behind it, do stuff within the video to really keep people watching.

 

49:06 SW: A great example is, I've seen a video that someone said, "I'm gonna get to the main point of how you're gonna build a better dye." I saw this video, and I think you did a really good job of saying why gluten, and it's gonna affect other areas of your life that you're in. I'm gonna get to that point. Well, what that does, that's a great segue into continuously watching the video. And I think there's messaging inside of videos and content, the way content is put together, that really can bring listeners in for a longer period of time. Now, I'm not an expert at that, but we've been testing on a lot of different longer form contents, trying to figure out, "Will this drive acquisition?" That's something for 2018 that I think is a big priority for us, is really getting into the weeds on that.

 

49:51 ET: That's great. Yeah.

 

[chuckle]

 

49:55 SW: Cool, man. Before we wrap things up... I know we've been on for an hour, and I really appreciate your time. I know you're super busy. We've been trying to plan this podcast for a while, to get you on. Is there anything... [chuckle] You're a busy guy, man. Is there anything else you'd like to share with the audience before we wrap things up?

 

50:13 ET: Yeah. I would leave with this. I would say, talking about empathy, and data, and really using those two things to drive and thinking about your consumer, you also have to think about what are you building. It's so important to think about... Facebook is a tool, you're exactly right. It's a tool to convey a message. So is print advertising. So is Pinterest. So is any of these other channels. And if you are just trying to build something that's... No matter what it is, lifestyle business, a big business, omni-channel type of sales distribution type of business, it's all over the map. But I think, if you don't decide what you want and what you want to build, you're not gonna have any center of gravity, and you're gonna constantly be chasing the next blog post, or the next strategy, or the next tactic. And I would say, for so many marketers that I meet, between the free content that is on this podcast, on digitalmarketer.com, and anything Russell Brunson says, the free stuff that is out there that, if you're listening to this podcast, you have likely already heard or been exposed to you, the ideas that will totally transform and help grow your business, if you will go execute them.

 

51:41 ET: So I would just encourage people to think about what do you want, and then really take an information diet for a moment, and then really go focus on spending 9% out of 10% of your time focused on discipline of execution. And I think you're gonna be so blown away by the results of just doing the stuff that's already out out there. That's my biggest encouragement, is that there are so many valuable free resources and tactics that... You could drive yourself in circles all day long listening to guru A or guru B, who both have great advice, but they conflict each other, versus just choosing one, and really going for it. [chuckle] It's like the "Choose your analogy," or it's "He who hesitates is lost," and then, "Look before you leap." Right?

 

[chuckle]

 

52:36 SW: Yeah.

 

52:37 ET: You can spin in circles all day long, but if you choose one and go, and really focus on execution, I think you're gonna be really happy.

 

52:46 SW: I couldn't have said it better. And I'm gonna piggyback on top of them, and just gonna say, don't be scared to fail. I think that if you work at an organization that's big, you can make positive change. And I think that's something I always lead with, when I talk to a lot of the brands we work with, a lot of people we work with, you can make positive change and don't be scared to really fail because, you know what, a lot of us fail. Evan, you're a very successful man, but I'm sure there's times where you failed, and you're not scared to fail. And I think that's what I love to build into my organization is, hey, guys, people are hiring us to figure out how to be successful, but don't ever be scared to fail.

 

53:29 ET: Absolutely. Failure is great, mistakes are great, not learning from or repeating the mistake is not great. [chuckle] Make a ton of mistakes. The quicker you can make mistakes as you're learning, and making sure your Kaizen approach where you're always approving, documenting and not repeating the mistakes, absolutely lean in and make more mistakes as you document and learn from those mistakes.

 

53:56 SW: Cool, man. Well, I wanna wrap things up there. I think that's a really good conclusion. I really appreciate your time, and I think there's a lot of nuggets here that a lot of people are gonna appreciate on long form content, maybe even... There might be a segment two on long form content in the future. You never know. [chuckle] If we could talk you into... We'll go talk to your agent and see if we could get you back on in the future, man, because I think this is a topic that a lot of people are interested in. And I just wanna say I really appreciate you taking your time out of your day, and hopefully I can make it down to Nashville. We could grab a beer at some point in the near future.

 

54:34 ET: Hey, man, I appreciate it, Steve. Thanks for having me on, man.

 

[music]

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