🥗 Learnings From A 9-Fig DTC Brands

NEW FREE RESOURCE, JUST DROPPED 🚨

You’re getting two emails from us today, because we just dropped a free resource called: “The Obvi Swipe File” which is a swipe file with all of our top-performing ads + the elements we think about when creating ads.

To make it easier for you to find it in your inbox in the future, we’ve sent it in a seperate email. Just search for “Resource” and you’ll find it 😉 

We hope you like it. Now back to the newsletter

Hey there, and welcome back for another bite to chew on

This week - we’re switching things up and want to stop talking about ourselves (for a bit, at least)

Instead, we’re talking about one of the most ass-kicking brands the DTC landscape has ever seen and what you can learn from them.

They’re a 9-figure brand that’s grown from 0 to $250 million in total sales.

… without raising a single cent from investors

It almost sounds too classic to be true… but it’s not (Pun Intended)

Yes, we’re talking about True Classic.

Thankfully, we’re better at writing content and building DTC brands than making jokes - so let’s dive into it.

Play bigger and go global.

For True Classic, 30-35% of their sales come from outside the US.

That’s impressive by itself and should motivate you to start thinking about how much you’re losing out on by not selling globally.

… but there are also some other reasons why playing bigger and going global can give you a competitive advantage.

For example, you can sell in less competitive markets that are cheaper to compete in.

The US is one of the biggest, most competitive, and most expensive markets to compete in… in the world.

This presents a great opportunity to sell here, but…

The competition is also fierce, and the price for attention (CPM) is higher than in many other countries with the same level of income.

Now, selling globally has its very own challenges, such as logistics, cultural barriers, and legislation.

But if you can overcome that…

Then you can unlock a whole new level of growth.

Don’t trust anyone; Collect your own data

Relying solely on attribution tools for decision-making is foolish.

Instead, you need to combine your attribution tools, such as Triple Whale, with tools that help you get first-party data, such as KnoCommerce or the like.

This way, you can do your own attribution modelling and figure out which marketing channels are actually driving results for you (even if it doesn’t show in the attribution tool)

Acquisition is growth; Retention is profit.

The reason why we love this quote so much is that even if you’re struggling to make a good profit on the first order, you can still be profitable on every order after that if you play your retention cards right.

In the case of True Classic, their acquisition engine is predominately Meta Ads - where they acquire customers at about a break-even or slightly above

… and then they squeeze all of their profits in the backend through their Email/SMS flows and Mobile App

Relentless focus on P&L and unit economics

One of the most important things we’ve learned from True Classic is their relentless focus on understanding their P&L down to the last digits.

It’s just not enough to simply know your CAC, Contribution margin, and marketing costs.

You need to break it down into creative costs, merchant fees, marketing costs per channel, handling fees, etc.

Because without clear visibility of the entire breakdown of your P&L, it becomes super difficult to optimize anything really.

This is also why we started working with Finaloop, who gives us this very breakdown of each item in our P&L in real time.

How they make their ads stand out from the crowd

We could write a complete newsletter on the brilliance behind True Classic’s ads.

But for now - we just want to give you the bullets of why they’re so effective.

1) They don’t feel like ads

2) They don’t sell T-shirts. They sell the feeling of “Oh, you look so good” and “Oh, have you been training a lot lately.”

3) They’re entertaining and keep the viewer engaged, which results in lower CPMs (assumingly), better hold rates, and overall better CACs. Again, assumingly…

If there are one brand’s ads you need to study (other than ours, ofc) - it’s True Classic. They’re crushing it, and everyone can learn plenty from them.

Tool of the week

The worst thing about eCommerce for us has always been figuring out sales taxes.

We get anxious even by writing about it.

Seriously, nothing in the world is more complicated and frustrating than this.

Last week, we were having dinner with a few DTC founders, and we got introduced to this new startup called Numeral, which offers DFY sales tax services.

We were initially quite sceptical because of the complex nature of sales taxes - but they’ve proven to be awesome to work with.

Before we signed the contract, they gave us a full audit and showed us all the mistakes we were making - and not long after signing the contract with them, they started fixing those mistakes.

We’re glad that sales tax is officially not something we have to deal with another day in our life. If you want to feel the same way, we’d recommend you get a free audit from Numeral and see where they can help.

Thank you for reading along

If you’ve made it this far - just know that we appreciate you.

We wish you a productive week ahead and hope to see you again on Wednesday

All the best,

Ron & Ash