#764 - TikTok, AI, and a $3M Soap Brand

#764 - TikTok, AI, and a $3M Soap Brand Unknown Speaker: Today we've got two guests for the price of one. One started a side soap business while running a cleaning company and scaled it seven figures. And the other has awesome AI strategies that have helped this company generate tens of millions of dollars of sales online and even through old school catalogs. How cool is that? Speaker 3: Pretty cool, I think. Hello, everybody, and welcome to another episode of the Serious Sellers Podcast by Helium 10. I'm your host, Bradley Sutton, and this is the show. It's a completely BS-free, organic conversation about serious strategies for serious sellers of any level in the e-commerce world. We're talking AI here at this conference, a lot of stuff, but right now we're going to talk a little bit about soap. But this is the first time you've been on the podcast, so let's first just go ahead and get your backstory. Speaker 1: My name is Joe McCutcheon and I own Carolina Castile Soap. Speaker 3: You just told me you live in Raleigh, North Carolina. Is that where you were born and raised? Speaker 1: I was born in Maryland, raised in North Carolina, carry North Carolina since I was five, mostly lived there for the rest of my life except for a couple of years in Phoenix, Arizona. Speaker 3: Did you go to UNC or anything? Speaker 1: No, I went out to Phoenix, Arizona. I went to a community college out there, studied chemistry for a couple of years. Speaker 3: Chemistry on purpose, you know, like I know some of us have to take chemistry as well. So if you're taking chemistry on purpose, what were you thinking about getting into? Speaker 1: I really hadn't even gotten that far. I just realized that like I kind of had a little bit of a passion for it and was decent at it and figured it would probably come in handy in something worthwhile at the time. Speaker 3: Okay, but then you got your two years there and then what did you do after? Speaker 1: I just discovered that really school, college wasn't for me and ended up not even completing the whole two years and went into the restaurant management business and moved back home to North Carolina and I was a cook and became a manager there and worked there at a restaurant there for about five or six years as a manager. Speaker 3: Chemistry, restaurant, food industry. What year and how did you discover e-commerce? Speaker 1: 2014-2013. I had been running a cleaning company after I got out of the restaurant business, ran a house cleaning service for six or seven years at that time. And then I started making soap to clean houses with. We were using another brand of soap. I thought it'd be really cool to tell our customers that our products are so natural that we make them ourselves. My cleaning business, I got to a point where I could hire managers to run it in my absence. I was enjoying making soap so much that I was like, maybe I should just start selling soap. I think I started testing on eBay just to see if people would actually buy it and they were. In 2014, I started on Amazon. Speaker 3: So this was all made in USA completely? Speaker 1: Yeah, at that time, yes. Yep. I was making it all myself actually for the first like four or five years. Speaker 3: Is that something you can do like in your bedroom or you had a garage? Speaker 1: Actually, I started in my kitchen and I broke several stoves because these five gallon pots were like so heavy, it was weighing down the coils and they'd break and Eventually, I got a 50-gallon tank to cook it in my garage and I was making 50 gallons every other day. As soon as it would cool, I would bottle it and start another batch. I couldn't keep up with it and eventually realized I was going to have to hire it out because I didn't have the expertise to make it in much larger batches than that. Speaker 3: So the chemistry actually did come in handy here. We're talking chemistry and we're talking batches and barrels in your house. All of a sudden I'm thinking Walter White's Breaking Bad action going on here. During this time, your main income, I assume, was still running the cleaning business. At what point were you like, hey, this could potentially be a full-time gig or a lot even more profitable than I thought it would be, not just a little small side hustle? Speaker 1: Well, I absolutely lived off of the cleaning company income and that's what enabled me, for better or for worse, to reinvest all of my profit into the soap business and really be patient with it. It was probably around 2020 when people started panic buying soap. It wasn't that we just got a temporary surge. That temporary surge led to more customers, more exposure. It was probably after that time that I started to see that this was something that I could do much better than my cleaning company and now I'm about to sell my cleaning company and our soap revenue is triple what we do in house cleaning revenue. Just the last few years really have I started to consider exiting the cleaning business. Speaker 3: Are you always growing or was there another year other than last year, let's say, or what you're projected to do this year that was your biggest gross revenue for the soap company and about how much was it? How much was it last year or how much was your peak or if this year's projected is your peak? Speaker 1: How much are you projected to do projecting 3 million for this year last year was 1.8 and we've we've grown pretty much every year, but it leading up to 2020 it was like. Speaker 3: Just barely growing one would think that soap is a pretty competitive niche, you know, like any any kind of product like that shampoo, you know, soap, you know, things that people can, you know, the huge billion dollar companies are in. How have you been able to? I've been successful, especially at least in the beginning. Maybe you're about to say that you have moved manufacturing somewhere else, but how in the world were you able to be profitable and compete in such a difficult market? Speaker 1: That's a good question. I mean, soap in general is very competitive, but we sell a particular niche of soap called Castile soap. What's that mean? Castile soap is soap technically soap made from olive oil but over time that's evolved to mean really just soap made from any sort of fatty acids from the saponification of any fatty acids, vegetable fatty acids. Speaker 3: What's the benefit of that? I'm assuming that there's some kind of purpose or value. Speaker 1: Sure. People like knowing that they're using soap made from coconut oil and basically foods, things you can eat and feel like it's safer because of that. But Castile soap, one thing I think that's really special about it is just how multipurpose it is. Our soap, you can shampoo with it, body wash, hand soap. You can scrub your dishes with it, clean your house with it, do your laundry. Speaker 3: Interesting. At what point did you outgrow your home manufacturing side of things? Speaker 1: That was in 2017. At that time, we were only making liquid soap. We're we're just outgrowing like i said we're we couldn't make it fast enough we would make it as soon as a call we bottled and eventually i started reaching out to other manufacturers and once i found actually i found one that was making one of our competitors products and i thought well man if they can do that they must be pretty good and so. When they started making our soap, that's when I started getting into bar soap. And really, Castile bar soap is kind of unique and special. We do about 70% of our revenue on Amazon. I guess it kind of varies month to month but we've tried Amazon Europe in the past and realized there's just so many regulations to get through in Europe to start selling there and our soap is so heavy and bulky to ship over there. We may revisit that at some point but we're 70% Amazon US approximately and the other 30% for the most part is TikTok shop. Speaker 3: Any Shopify? Speaker 1: Well, I kind of bundle my Shopify and TikTok. So let's say maybe 5% Shopify, 25% to 30%. The 30% is mostly TikTok, some Shopify. Speaker 3: Are you profitable on TikTok or are you running it for the halo effect on Amazon or a mixture of both? Speaker 1: I've heard people say how TikTok is just to get the halo effect on Amazon. You don't really need to go into it expecting to make a profit. I think that's just completely not the case for us. Our margins are just as good on TikTok. Fulfillment by TikTok, their fulfillment fees are so much better than Amazon's. That we are able to, you know, take that extra savings and put it into, you know, working with creators and things like that and ads. So, yeah, we're definitely profiting on TikTok and we're also getting the halo effect. No doubt we're getting the halo effect. But selling on TikTok, especially fulfillment by TikTok, is definitely profitable. Speaker 3: I like that. I like that. And we're talking in 2026. This is in 2023 when TikTok was basically paying you to ship a product out. So even with all that stuff gone, it still sounds like it could be profitable and good shipping. When did you start using Helium 10? Speaker 1: Around 2020, I think we started working with an Amazon management agency and they recommended Helium 10 and started working with it then. Speaker 3: What are the tools and use cases that we're using? Are you using it to look for new, I don't know what you call it, flavors or new kinds of soap? Are you looking mainly for keyword research, listings? Speaker 1: Yeah. I think maybe our biggest benefit from Helium 10 is the Google Chrome plugin where you can I was just showing somebody this downstairs. To be able to look at any product's revenue over the last 30 days is pretty neat. It seems like a lot of people don't realize you can see what people are selling, what their sales are on Amazon. We'll use that to evaluate getting into different categories. The biggest thing we're using Helium 10 for is just to be able to evaluate other products and use that to determine where to go next with ours. Not only just new product categories, but one of our biggest things we do in a new product launch is just changing the scents of our soaps and so evaluating some of our competitors and what their best performing scents are. Using the Chrome extension has been really helpful. That and then I get my daily email with, you know, our ranking and then the alerts, you know, and, you know, something changes on our listing. Speaker 3: Has something happened where you got the alert and you were able to take action? And if so, what was it? Speaker 1: You know, one of the biggest ones, I mean, it's not even that big, but it can add up to a lot of money is like when our dimensions change. Sometimes well, you know, just like randomly changes to something that doesn't make any sense at all. And I'm like, I'm glad I didn't miss it because God knows how much that would add up to over the course of years. Speaker 3: All right. Something I'd like to do for the ones who are open to talk about their brand. Say your brand again, how people can find you and the website, and if you can give us a discount to the listeners, but also like, hey, if they're just getting into their first kind of soap, which one should they get? What's a good starter pack to get? Speaker 1: Yeah. So our brand is Carolina Castile Soap. You can find us at castilesoap.com. That's Castile with one L. This is my website, www.castilesoap.com. We'll do a Helium 10 coupon code for 10% off. You'll just put Helium 10 as the code. My current favorite is our Patchouli Bergamot Liquid Castile Soap. You'll love that blend. Our bestseller is Tobacco Vanilla. If that sounds like something you'd like, that would be a good one too. Speaker 3: I've been searching for different soaps and I got some popular ones and I was like, this soap is terrible. My free agency continues for getting married to a certain soap brand, so I'm going to give this one a try for sure. Now, not any company can just get on Amazon, scale up to millions of dollars of sales. What are some of the unique strategies other than having a good product, having good formulation and being in a good niche? Obviously, that's important. But what are some of the unique things that you're doing that maybe the average person. Speaker 1: The things that have really been working well, one has been just working with creators on TikTok. Sending out as many samples as possible. The other strategy I would say would just be that one thing that really two things made all the difference for us. One would be, you know, when I first started out, I was designing my own packaging. I designed my own labels and like for me, the designs I came up with were like, okay, but like if you look at what our label looks like now and compare it to what it was before, it's almost a little bit embarrassing. But just finding a really good designer to make sure that our labels just look as good as possible. I'm not sure if I'm allowed to cuss on here, but there's some cuss words I can think of to think of when I describe how much I love our new design. That is what helps our main images be so good is I think just having beautiful packaging and maybe touting our own horn here calling it beautiful, but we get that a lot. People really compliment our packaging and so being willing to spend the money to hire a good designer to make good packaging. And the other is like really opening our minds up to doing something different. Like we used to, and I think this happens a lot in e-commerce selling is people just kind of copy and duplicate what other people are doing. And that's what we did for our first maybe six or seven years is we just made the same scents and fragrances that other soap companies were using. And I remember during COVID, I was playing video games with a buddy and he was like, man, do y'all have any like masculine fragrances, like a leather or tobacco or something? I was like, no, that's a good idea. I should like, you know, we were so closed minded while we must have all organic everything. And it was only when I opened my mind up to saying, you know what, like, maybe 100% of the ingredients don't have to be organic. Maybe we need to open our mind up and consider using a fragrance and not just essential oils. And so I guess the strategy is just like opening your mind up to doing something different and not just, you know, following what everyone else is doing and And just try to come up with something unique. Speaker 3: Yeah, so I mean, obviously, you could, you know, use Helium 10 to like look for what people are searching for that might not be out there. You're like, maybe, you know, somebody is searching tobacco, leather, soap, and you see there are none. Okay, that doesn't take a rocket scientist. Or a chemist to know that this might be a good way to go. But absent that, you know, when it's just a friend saying something, that's just one person. What has been your process as far as like, how do you validate, you know, because I'm assuming you can't just, oh, I mean, maybe you can, you tell me. I can't just make 10 bars of soap as a test run and then put it up on Amazon. I'm sure it's got to be some kind of like minimum order and like you said, packaging and stuff. And so, you know, you might be thousands of dollars in when you go for a new fragrance. What gives you the confidence to do that? Do you have any kind of testing that you do or like how in the world do you get confidence to invest that kind of money into something new? Speaker 1: I mean, it was a bit of a gamble, honestly. I mean, we looked out there to see, you know, maybe there were another Castile soap brand selling, you know, masculine fragrances. But if I looked at some other brands that sell other soaps, I could see that, again, using the Helium 10 Chrome extension, I was able to see that like people are buying a ton of For example, for us, again, it was diverting from natural essential oils to a fragrance that might be a blend of natural and synthetic compounds. Looking around, I could see that there were brands with Their whole ingredient list was synthetic ingredients and I could see what they were selling and I was like, there's no way that this won't work. I mean, I don't know that I was like, there's no way, but I was like, it seemed pretty promising. And so, you know, I forget what our first batch size was, but it sold out very, very fast and we quickly realized that like, this is going to work. And yeah, our batch sizes increased every time we've reordered. Speaker 3: You mentioned a target of 10 samples a day on TikTok shop. What are some other strategies? Like once you get these 10 samples, are you like engaging with them? Do you try and get their content information or it's like, all right, here's a sample, go do it. Like, are you telling them what kind of video to do? How are you even looking for these, you know, creators? Are you looking for ones that have made videos on soap or just random, you know, certain demographics? Speaker 1: Yeah, actually, it was really interesting. Earlier, I met someone where I learned some strategies of what we're doing from this podcast, and I got talking with him. I was like, oh, you must be the guy that was on this podcast. Speaker 3: Talking about Josh, maybe? Speaker 1: Yeah, yeah. I remember hearing he said that he – When someone signs up to get a sample, they send them – and here's what we do that he does is we send them a form to fill out where we basically get their email. We started asking them to give us permission to reuse their videos. We discovered that most of them didn't want to do that and so we stopped doing that and we'll kind of do it on a case-by-case basis. We get the information, we add them to a newsletter that we use for our creators, and we invite them to a Discord. What we try to do is use that Discord group to let them know when products are back in stock. I mean, we've definitely faced a lot of In and out of stocks with our products, it's been, like I said, it's been hard to keep in stock at times. And so when things come back in stock or we do a new product launch, we always use the discord to try to communicate that to them that, hey, you can do a video and announce that such and such is back in stock. Speaker 3: Awesome. Awesome. All right. So there you have it. I mean, some of his strategies you learn right here on this podcast. Now he's paying it forward. Maybe you guys haven't heard that other podcast, you just heard it from him. And you guys can implement some of these, these strategies here. That's what I love hearing stuff like that, where people think, Oh, yeah, I learned this from, from this person, then they ended up meeting them in person, like you're here at a completely unrelated event. I love that. Love that. What's the future hold? You know, now that you're exiting your your cleaning business, Are you going to have more bandwidth to go more in on the soap business or are you going to take this extra time maybe to enjoy life a little bit more without having two jobs or two businesses? Speaker 1: To be fair, my cleaning business, I haven't really worked a day there in probably 10 years and I don't spend a lot of time on it. But I guess if nothing else, it definitely frees me up to just keep leaning into my... Really what I've been doing For the last years here, it's just been like going all in on the soap business. And so I'm going to keep doing that. Like I said, we've been selling liquid and bar soaps, but I've been working hard at getting into some new categories. I want it to be under this brand and still be personal care products. But I feel like we're on the cusp of finally launching into a new category of product. And again, when I say category, it's still beauty and still personal care, but just not soap. I feel like we finally built up enough of a following with our brand that people love our scents that they use in our soaps and they want to experience those in other products. That's what I'm hoping to do is just add on our product, keep launching new ones, and really improve some of our existing processes. That's why I'm here at this event is to try to learn how to improve my processes. Speaker 3: We're here at Market Masters. We've had some great sessions today. What's one takeaway today that you learned that you're going to be implementing in your business? Could be something you talked about from networking or from one of the sessions? Speaker 1: You know, it was really a question I heard one of the experts ask someone and that was on the hot seat. They said, what do you what is your dream organizational chart going to look like in a few years? Like what what do you foresee it looking like if you want your brand if your goal is to grow your brand to such and such revenue? What's your organizational chart going to look like then and kind of like the implication is why is it not starting to look like that now if that's where you're trying to get to and so that's what I want to I'm always really most recently been really trying to evaluate how I can free up my time from doing things that are not helping our brand grow. It's not helping launch new products. And free myself up so that I can do the things that are really going to help us grow and not be like, I don't do a lot of this. But here's an example of like stuff I might do is like in a like in a pinch if there's a return or we need to replace someone's product because it got damaged. I might even pack that box up and label it myself and take it to the post office. I'm not opposed to doing that obviously but I think my time would be better spent doing other things and finally just in the last year or two we've hired people. My wife's involved with the business more now and we've hired a VA and I'd like to keep hiring more assuming money allows but I'd like to keep freeing up my time. That's one of the things I've taken away from this. Speaker 3: Awesome. Awesome. All right. Well, it's nice to meet you in person here and look forward to maybe, you know, reconnecting in a year or two and see where the business is at. And I'm going to go ahead and go buy some of this stuff right now. And who knows, maybe this is my new go-to soap. I'll let you guys know in a future episode how it worked out. And you guys let us know if you bought some of it in the comments below. We're continuing our series here in the ridiculously hot Austin. I don't know if you guys can see this. It is 101 degrees. Speaker 1: Outside. Speaker 3: I don't know how people can live in this, but we have people here from Dubai. They're probably like, oh, I need to put on a sweater. It's a little bit a little bit nippy here. But anyways. I don't even know where this gentleman is from. We're about to find out. It's his first time on the show. Marc, welcome. How's it going? Speaker 2: It's going pretty well, and I'm actually from Atlanta, so very similar weather here. Speaker 3: Atlanta is where you live now. Is that where you were born and raised? Speaker 2: No, I'm originally from Cincinnati. Speaker 3: Okay, Cincinnati. And when you graduated school or high school, where did you go to college? Speaker 2: So I graduated like after my freshman year of high school. Speaker 3: And then did you go to college or do something else? Speaker 2: No, I started a business. Speaker 3: I like that. Entrepreneur from an early age, what did you do? Speaker 2: I had a consulting firm, so I had mostly doctors, dentists, lawyers at the time that were clients, and I had one big one, a company called Merrill Lynch. Speaker 3: What were you consulting about? Speaker 2: Mostly back then, there wasn't a ton of software like there was today, so I was helping to put software in place to solve business problems, so every business had a different issue. For example, like at Merrill Lynch, most of those financial advisors, they all had their own little individual businesses just under the Merrill Lynch banner. They're all running custom CRMs, things like that, so I was kind of putting those in place for them. Speaker 3: Now, in what year did you discover e-commerce and what aspect of e-commerce was your first entry? Speaker 2: So after about four years of having my consulting business, I actually went and joined a larger consulting firm. So I went from about 20-25 clients to about 100 overnight, 85 different verticals. So there were some e-com clients there. And then in 2008, the company that I actually work for now became a client and I wrote the software system that still to this day runs all of the online sales and pretty much the entire company. Speaker 3: Okay. Did you ever sell on your own or it's always been as like a consultant and working for companies and managing what they do? Speaker 2: It's just been selling services on my own. So I never sold goods myself, but obviously for the last 18 years been selling supplements, skin care, Publishing that kind of thing. Speaker 3: The companies you've been working. Speaker 2: Yep. Speaker 3: What percentage of what you do for people is Amazon? Has that changed over the years now that there's newer things that didn't even exist a few years ago, like TikTok Shop and other things? Speaker 2: Yeah. So e-tail, as I call it, or online retail, has become a larger part of our business. It was nonexistent four years ago. So we primarily went on to Amazon to defend our brand, defend our turf. And then accidentally started making a couple million on Amazon a year. So I'm like, Oh, we should probably manage this and grow this. So we've now grown Amazon up to about 10% of our business. We've got TikTok, you know, kind of getting launched this year. We've got Target Plus coming online. Walmart Plus has been on for a while, but you know, Walmart's still pretty much smaller than the Amazon game. Speaker 3: And across all online channels, for this entity here, what would you kind of project this year's sales to be gross? Speaker 2: This year is going to probably be a little bit better than last year. We're typically in the $30 to $50 million range. We'll probably be right in the middle there this year. We kind of did some restructuring. It was kind of more strategic, so we've been pulling back on some of our Metaspend and a few other areas to be a little bit more profitable this year just to get some decent cash flow for some new exciting product launches. I think we've launched six or eight new products over the last two years, which probably is more than the previous eight years combined, for example. So we're really putting an emphasis on kind of changing the types of products we have and the image of the brand. Speaker 3: You just mentioned launch. I think over the last eight years, that's been one of the things where strategy has changed the most in the Amazon world. So thinking back six, eight years ago, to now, these latest six to eight products, what has changed with your launch strategy? What's working for you now? What has stopped working? Speaker 2: So previously when we would formulate a product, it typically came from a doctor formulation, a protocol, something like that. And then we would go and formulate the sales message around it. Now we're looking, we're working with state-of-the-art ingredients. We're working with I got like a research chief science officer that kind of thing and then we kind of know the messaging before we even get the product and we're getting all of the marketing landed. So that's been a huge boost for us because we've been able to go straight to like an Amazon for example and have marketing from day one. Whereas previously it was like we know this formula exists. We know why it needs to exist, but the how it's going to land in the market. We didn't necessarily know so it's been kind of a complete 180 on getting the marketing done first and then having the product arrive in a very short time after that. Speaker 3: Do you launch on Amazon at the same time as other channels or do you? Get some activity elsewhere first or vice versa. Do you launch on Amazon then on their channel? Speaker 2: So typically we'll do a pre-launch with our house list, right? So we primarily 90% DTC. So we'll get a good read of how the product's going to work. And then from there, we will launch on Amazon next. And then TikTok would be third. We have been lately toying with the idea of doing TikTok exclusive launches or Amazon exclusive launches. We haven't done that yet, but it's definitely on the horizon. Speaker 3: Now, here at Market Masters, you are talking about AI. Talk about how AI has changed your business and what's been the biggest unlocks. Is it just being able to look at data that you didn't even have time to do before? Is it automating a task and lessening the amount of humans that work for you? Is it on the graphics side? What is the biggest unlock? Maybe just give us a little tidbit of what you were talking about here. Speaker 2: For us, AI is not really reducing workforce. We're actually increasing workforce with AI. It's allowing us to get SOPs and stuff like that in place faster. It's allowing us to look at data like you said. Typically, it's like I kind of knew the numbers on average and they don't change that much, but now it's like I can verify that in real time. The other thing we're using AI for is giving some of our A-plus players their time back by helping to move some of the minutiae off of them that was really hard to actually either move to a VA or an EA. Or automate before. Now with some of these modern-day tools, like I talked about one today, like RockBot, for example, it's like you can record your screen and just show it what you need to do. It doesn't even need to have an API. It can literally scrape, do whatever, and we're using tools like that. The workshop I did yesterday is a process. I used to write a lot of software way back in the day that over the last year I've been using to build internal tools. So like for example, my purchasing director now has a supply track software that we now know is projected stock outs. And not only is it a projected stock out from like a normal inventory management sense, but it has our entire business model around seasonal Like sales, we still do direct mail because we're a dinosaur. And when I say direct mail, I'm not talking about postcards. I'm talking about like 24-page magalogs, right? And so that'll have a huge bump or utilization of units on a certain product, but it's not consistent and it's a long burn rate. So sometimes it'll be like 45 days to get the full response back in. And so now we're able to project all of those things in like basically real time. Sync from NetSuite, sync from ShipBob, sync from Amazon, sync from Walmart, all these various vendors. Sync all of our sales at the same time and then look at like, okay, did something change? What's the rolling 7-day burn rate? What's the rolling 30-day? What's the rolling 90? Kind of go from there. When did you discover Helium 10? I found Helium 10 either at Amazon Accelerate last year or it might have been at Prosper the year before. We were accidentally doing sales on Amazon and I just needed a better way to view my metrics for Amazon. I think I just walked in. Whoever I talked to at the booth, I can't remember. I just shook their hand. I said, yes, I want the diamond plan. And I think I walked away. And the next minute it was set up. And then I think I've only ever logged in and looked at the dashboard. I have the team members and two other things in there. But that's just kind of like a single pane of glass. Easy for me to pull Amazon numbers. Speaker 3: Now, especially you guys being an AI forward company, you should definitely start leveraging the MCP if you haven't. Speaker 2: I just saw that you guys had released that or were talking about it this week. I've got my Amazon analysts like Rockbot, for example, and I'm planning on getting that into the MCP probably before the end of the weekend. I like to implement a couple of things at each event I go to before I leave the event. I think that's super important. That's one of the things that's on my short list to do. Speaker 3: Awesome. Supplements, this is one of the things that's maybe competitive, saturated, people might say, like for TikTok and things. How have you guys been able to still scale up despite there being many supplements? Do you guys have completely unique value props or is it something unique about some of your strategies that you're doing? Speaker 2: It's a combination of things. One, we've been doing this for literally over three decades. So, we're very good at honing in on the story and the hooks and getting the marketing right. And then on top of that, especially with our newer formulas, and we've always had unique formulas, but the new ones especially are really, really hard to replicate. And part of that is because of, honestly, the cost of it is to manufacture these things at the scale that we're doing. So, we're able thankfully to introduce a product at a lower MOQ initially, maybe eat a little bit of that. Gross margin, but then rapidly scale it up to get it where we need it to be, you know, long term for successful growth. A lot of companies that are smaller haven't been around as long are going to have a pretty hard time doing that. It's not going to make sense on the balance sheet initially. Speaker 3: I think, you know, like 10 years ago, people were DTC brands, people were Amazon brands, you know, mom and pop never went Shopify and everyone anything that there was not even a TikTok. Nowadays, it's almost like a must that you need to be multi-channel, you know, be on multiple platforms, even if you're sub million dollars, arguably you should be. For you guys managing different, you know, channels, I assume, you know, you sell the same or similar SKUs. How are you managing inventory, production, profitability? Do you have it just at the marketplace level? I'm only looking at profitability here. I'm only ordering inventory for this channel, and then we're making another run for this channel. Or are you guys combining everything into master skew and trying to make one order? Maybe we're not so profitable over here, but we think it's helping profitability on Amazon. We're looking at one profitability. How do you guys look at multi-channel? Speaker 2: So we look at it all those different ways. That's pretty much one of my things I do daily, usually first thing in the morning. So I'm looking at our individual marketing channels for our DTC, right? So we have our own software stack, right? Own custom e-com platform. So for that, you know, we look at direct mail by itself. And then I look at meta by itself. I look at YouTube by itself, native, right? And then we look at house traffic and see how is that fluctuated with, you know, spend levels and things like that. And then we look at Amazon kind of isolated. We look at Amazon and Walmart, like TikTok kind of all is one right now. And the other two are small, but obviously Amazon is large enough. And then the last thing I look at as I roll all of those numbers up to the parent SKU is actually exactly how you mentioned it. And I look at the spend, how much it costs to fulfill that SKU to the month, and is that number in the black or in the red? And there's a certain level of margin I need to hit to pay overhead. Speaker 3: How much AI are you using, if any, for your visuals? I mean, obviously you're doing, you know, traditional Sears catalog, you know, type stuff. You're doing Amazon images, you know, advertising, maybe Facebook ads and stuff. How much of this is AI generated? How much are traditional photo shoots, etc.? Speaker 2: So we still do a lot of stuff non-AI. So I've got in-house graphic designers. Most of our images that we're testing on meta statics, those are AI generated. It's a fast way to test hooks obviously. Most of our videos are not. We still have our agencies either shoot in studios either in the Tampa area or like I actually will film and go on site with some of our doctors across the country and we do film with them. So we're still a little bit old school that way. I do find that, you know, AI is trained on everything, right? So the definition of everything is kind of mediocre. And so for companies that were really bad at it before, I'm sure AI is helping them to get where they need to be. But I think for a company that was really good on creative, it may not be helping them quite as much. Now, I will say that you can get some magnitudes of scale going on and some faster iterations. But like we have a custom piece of software where we can take an ad that we like, we see in the wild, and it breaks down, analyzes it, and then it goes across, I don't know, let's say 20 different hooks. 20 different, you know, CTAs across that, and I can generate probably 100 images in less than two minutes from something I just happened to scroll by and see on my phone and just go click, click. And then next thing I know, I've got it for our products, showing our product, not showing our product, top of funnel, mid funnel, bottom of funnel. It's pretty wild stuff. Speaker 3: I would say that's one of the more unique things about you guys other than your structure. Other than Kevin King, I'm not sure how many are doing direct mail these days. There's a brand listing out there. Maybe they're a seven-figure brand. Maybe they're an eight-figure brand. Is there a number of gross sales you need to be doing which all obviously would turn into brand awareness and things like that? Is it where it makes sense to look into direct mail or is it a type of product or hey, no, it's only if you've been in it for a while. If you try to start today, it's hard to buy a list. Who should be considering, if anybody, direct mail? Speaker 2: For one, it's definitely based on demographic. The magalog style, it's going to be an older demographic for that. Direct mail under an older demographic would be like a postcard. I'm sure Chewy.com, they mail postcards certain times of the year, things like that. As far as like a gross revenue goes, it's not so much that. It's more the tolerance of paying of everybody's used to instant results, right? I go spend money on meta today. I'm gonna look at my results tomorrow. With direct mail, you're ordering a mail drop. It needs to be a certain number of pieces and not be prohibitively expensive. It mails out. Usually you send a third class. So it's getting delivered over a period of several weeks. Then you're watching the response rate. People set it aside like I've got mail from two weeks ago probably sitting on my island at home I haven't looked at yet and so you're looking at a 45 plus day for the initial response to come in and so that's not everybody's cup of tea and it also requires quite a bit of capital to do a large enough mailing. So it's really more about cash flow than I would say gross sales. Speaker 3: Then if somebody were to start to look into it, where would they go? I assume the first step would be they got to know their demographic and then buying a list like are there websites out there or how much do they invest? How do they know if it's a good list or not? Speaker 2: Yeah, I mean, it's a small kind of world in the direct mail space. So a couple quick Google searches, you'll find most of the main list brokers and companies that do that. The actual first step to stepping into direct mail is having a killer sales letter because it's not a VSL, right? This is going to be on paper. It's going to be print. So you need to have had that tested in other channels and have like a crazy response rate before you move on to direct mail. Speaker 3: Do you notice a bump on Amazon at all? Like when you send a catalog out, maybe people look at it, but they're like, hey, I want to get it tomorrow. So let me just Buy it on Amazon or most of these people are going ahead and call in a number or I don't even know how what is the call to action on your catalog? Speaker 2: Yes for direct mail call to actions to phone number. We also have a website on their QR codes actually suppress response with our audience. We don't have a QR code and then there's a special code to call in. So our agents are trained when you call in to get that code. So we know and then there's also something we can do a back-end match against a list if we end up with People that can't find the code or whatever, we have what we call UNK, like unknown codes, those kind of things. As far as like a bump on Amazon, we definitely noticed a bump on PPC and Google. I don't know if we personally have seen it on Amazon where I could say this direct mail package drove these sales. I have seen that with native though. I find that interesting. I know TikTok has a halo effect as well on Amazon and I think it's product dependent. So I think the more in this particular niche and space and the supplements, the more expensive the product, the less likely they're going to go to Amazon looking for it. The cheaper the product, they might be like, oh, can I just get this on Amazon? Speaker 3: Any other e-commerce related but non-Amazon unique things you can talk about to close this out to our audience? Speaker 2: I mean, one of the things that makes us successful is a great house email list and just really building a cult around your business. I think a lot of people like when I take a look at our customer service tickets or things like that and I'm working with our customer service director, I go in there and I'm like, oh, what's our return rate this month? We have a really low return rate because we are, first of all, solving the problem at the product level by having efficacious products. But then on top of that, it's like, okay, well, we have a certain return period for money back. We make exceptions to that all the time. And those are the types of things about that's how you build crazy fans. When you have a cult and you have fans like we don't push subscribe and save that hard and the last I checked we have close to like a 70% reorder rate, which is pretty much unheard of out there. And so like those are the types of things that I would say if I was working with another brand, I would say first, how do we make this what brand want to have a cult like following and that's the first thing I would probably try and tackle. Speaker 3: I like it. How can people find these products or maybe even get on your mailing list? I haven't looked at a Sears catalog in like 20, 25 years. I almost want to feel what it's like to go there. I used to get excited when I would get the Sears and JCPenney catalogs and look through it, show my parents what I wanted and stuff. Speaker 2: Well, first of all, it's going to look like a health alert. It's not going to look like a catalog. It's going to look like a piece that you want to read and you're like, oh, wow, this is super important. Then you're going to realize you're reading marketing. No, you can go look us up. It's Advanced Bionutritionals. Speaker 3: Awesome. All right. Well, thank you very much, and we'll be seeing you maybe Accelerate or when's the next conference? Speaker 2: Accelerate next month. Yep. Speaker 3: Awesome. Catch you there.