What They Changed to Spend 60-70% Less On Ads

0:00We are spending like 60 to 70 % less in a given month and making more revenue because of changes we made to targeting and to creative. We know that like over 70 % of people who are buying our shoes are replacing running shoes. You have to care about the customer first and foremost. What do you think that even worked for Khlo about going broad? Welcome to the DTC Insider Podcast, where online business owners come to find actionable tips and tactics to grow their businesses. Now, here's your host, Brian Roizenthal.

0:57Sure. So Clove was founded in 2019 by Joe Ammon. So basically, here's the kind of background story is that his wife, Tamara, was and still is a nurse. Joe was a recent Wharton grad and was watching her kind of go through this struggle with footwear of trying to find a shoe that checked all the boxes of both form and function. Right. So trying running shoes and having issues with bodily fluids getting through the mesh uppers and the running shoes or trying clogs, which are sorry if there's clog fans on here, not the best looking. but are comfortable. Indiana had this light bulb moment of, there's got to be a way to combine form and function and have a shoe that is really custom designed from the ground up for healthcare workers.

1:39And that was sort of the origin of Clove. Right. And what's your background? Because I know you've been in the digital marketing space for about a few years, right? Yeah, so I've been with Clove now for coming up on five years, but going back to like 2007, 2008, I got started in digital marketing at an ad network called Tribal Fusion, which they may still be around, I'm not sure. But from there, jumped around to different ad networks, SaaS platforms, marketing agencies. I think it was at three different marketing agencies and ultimately landed at the brand side. And funny story, the kind of the bridge was that when in 2019, when Clove was just sort of getting off the ground, they were actually my client at a small agency that I was at at the time.

2:20And then I later joined them in-house. Nice. So take us back in time for a minute because I love those stories. What was the ad network world like back then, like in 2007? I mean, it was really interesting because it was revolutionary for the time, right? Because the early days of internet advertising, there was a lot of direct buys happening. If I'm Toyota and I want to run ads on car and driver or something, I would just go directly to the website and we'd be talking CPMs and, you know, minimum commitments and all that kind of stuff. You know, an ad network basically took a lot of the work out of that where, you know, the ad network had a, you know, network of different publishers that they worked with and a bunch of advertisers, which was good for both parties, right?

3:04As a, as a publisher, you know, if I'm, if I've got the, you know, tribal fusion ad tag on my website, I've got access to a bunch of different advertisers. Now, you know, I don't have to have those conversations one-on-one and as an advertiser, I've got, I've got access to a lot of inventory and I don't have to go have separate conversations for every different website I want to be on. And it was, and it was interesting, even in the, you know, couple of years that I was in that space, how it started to evolve. Of course, you know, then you had, you had these companies, like I'm trying to remember some of the examples, but like Pubmatic, Rubicon Project, I think are ones that come to mind where they were, they were like meta ad networks, where basically you would, as a publisher, let's say, you would go sign up with these different ad networks, plug your ad tags in there and then it would you know cycle through all the different tags for the different ad networks and that eventually then it kind of evolved from there into like programmatic so it's really interesting watching how things have evolved and you know now it's basically self-serve as a publisher and of course you can grab an ad sense tag but i can also go on trade desk or whatever and you know i don't need to work with that networks i can just you know basically have a fully self-serve solution change since then for sure i remember even the way of charging.

4:14I think if we go even more like further in time, like I don't know if it was 2011, 2012, like some Facebook back then, other companies, they used to, or agencies, they used to charge for likes because there wasn't any, if I remember correctly, like optimization events. Like everyone was giving away cars and in exchange of likes, shares, and joining their Facebook pages, right? and we used to develop back I used to have a I come from the from let's say I have a background in computer science and I used to have a software factory back then and we used to develop like the do you remember the tabs of the Facebook pages there were tabs in which you could go then have like games or information about the branches definitely remember the Facebook games like the you know Farmville and Mafia and whatever all those there were like some kind of like I I don't know, gamified experiences, spin the wheel or giveaways or games, whatever, you know, to win stuff because brands didn't care about selling back then, didn't know they could sell through those in the early days.

5:24So everything was about the likes, the shares, the comments, and agencies charged each like or each click or something like that. I think it was the click on top of that. So it was like a different world. So anyway, going back to you and your experience, I cannot help, but asking you before we talk only and exclusively about Clo, you meet on both sides, right? The agency, the SaaS as well, right? And the brand now. What was like something that you used to believe from the agency side that you no longer believe or you see it from a different lens and say, hey, this is probably not that way. And the opposite, what do you see now from agencies that you didn't see back then?

6:10I think that's a great, that's a great question. I don't, you know, and this may seem like a little bit of a cop out, but I don't know that my perspective has really changed that much. You know, I prefer, I think, you know, now with the benefit of hindsight, I prefer being on the brand side. I feel like I'm, you know, no longer kind of a mile wide and an inch deep, but you know, I kind of always felt like in the agency side, the number one factor that determined whether a brand was going to be successful was whether they made a product that people actually wanted to buy, right? Anytime we had a client that was in a heavily commoditized space, you know, or on the other side of the spectrum, they had something that was way too niche, I would always, you know, that would be painful, right?

6:50Like, it was just a lot of work to get that to work. And, you know, being on, you know, having been on the brand side now, like, I still feel, I still feel that way, you know, that, you know, sure, there's a lot of things that you can do well and do poorly, but at the end of the day, like, that's the number one factor. And it sort of sounds like a tautology it's an obvious thing but you know it kind of kind of plays to like the fundamentals like do people want to buy the thing that you're making right have you taken the time to do the market research a lot of you know clients that we work with on the agency side just had this idea like this would be a cool thing without ever stopping to ask people do they actually want this you know that that was a problem yeah i i hear you and i kept thinking about what you said about a mile wide and an inch deep or something like that.

7:34And man, I'll keep that one because it's exactly how it feels to own an agency or to work at an agency. And not only that, you need to be a different, let's say, Nick for a client one, a different Nick for a client two and for a client thousand. And the agency takes care of different things. For some, you are the hero and for the other ones, you know nothing. so it's a mix of what works for one doesn't work for the other so i i feel you i still love the agency world but sometimes it's like hey everyone like the grass is greener always on the other side right so we all want to have what we don't but yeah it's something that i always think about and what is something that didn't know probably about the brands that you've learned and wish that agencies do know now that you know as well?

8:24I mean, maybe a big one is a focus on profitability. I think, you know, looking back to, hopefully I'm not telling on agencies I used to work at, but, you know, we weren't really deep in the weeds on things like EBITDA, you know, and like looking at things through the lens of profitability. What we would do is we would, you know, come into the relationship with the, my cat is here, with the expectation that the brands were doing that for us, right? That basically when they say, hey, you know, here's our goal. We want to acquire this many customers. you know, the CAC target is X, Y, Z, you know, our assumption is that they had already done the math, you know, to understand like what is going to be a CAC that allows them to be, you know, grow in a profitable way.

9:00And a lot of times that turned out not to be the case, right? Like we would get a few months into a relationship and, you know, we'd be hitting the goals and they'd be saying like, we're not growing as, you know, we're not growing the way we want to, or we're paying too much. And it's like, well, you know, you, you gave us these goals, right? I think, you know, now agencies that we're working with more recently, I really appreciate the fact that they're really trying to understand from day one, the unit economics, right? So that there's no, you know, there's no hard conversations down the road where it's like, look, we've been doing everything that you're telling us, but we were operating on sort of faulty assumptions or you were kind of giving us the wrong targets.

9:32And as a director of marketing, let's say, what does your KPI dashboard look like that didn't look like that when you were working at the agency side, let's say? Yeah, I mean, we're looking, I mean, I'd say for us, this is probably similar for a a lot of e-commerce brands, you know, we're at a point in our life cycle where we're really focused on new customer acquisition. So we're looking every single day, we're looking at how many new customers did we acquire the previous day? What was the CAC? You know, we're getting into attribution and we can talk about that more in a bit to try to understand, you know, if we want to grow, right?

10:08Is there room to grow? And if so, like, where do we invest our next dollar, basically? So yeah, we're very, very focused on new customer acquisition and CAC. Right. So you started working for the company in 2021, right? And the company was born, let's say, in 2019. That's right. So it was pretty much not the beginning, but the early years of the company. So what were the main challenges that you were hired for solving? Yeah, I mean, the big challenge early on was growth, right? Things have changed more recently. You know, now over the last year plus, we've been really, really focused on profitability.

10:45you know sort of have our cake and eat it too we ultimately we want to be profitable but we want to do so and you know and grow early on as with a lot of brands you know especially privately funded brands like the the goal early on is is growth so our goals were were different you know we had higher cac targets i mean that's like the most superficial way to look at it but you know we had we had maybe a like a top-down approach to our revenue projections we need to sort of hit this number no matter what but you know now we're a lot more focused on every dollar has to pull its weight right that's very common like the top-down approach as you define it sometimes what i tell some clients you know it's like goals are not desires right how do you support numbers and i think something that i believe firmly and through experience validated many times is that growth is achieved among other things through the marketing calendar of course you need to have a product that has demand the product market feed like everything that aside all that aside i think that many brands forget about the marketing calendar the marketing plan and they just want to grow no matter what so last year you whatever i don't know a hundred thousand five hundred thousand in revenue x month and this year you want to grow by 30 percent with probably half of the actions why are you going to grow right so i was i wanted to ask you how do you you know work on the now you are on the brand side how do you approach the i don't know forecasting planning and to avoid falling into the trap of the desire versus the goals yeah i mean the good news is we we're bringing heat when it comes to the marketing calendar, right?

12:30Like we understand that people want newness. And so, you know, we're not, we're not just dropping product once a year. It has, it has fluctuated over time. I think back in, you know, 2023, we tried to dial back and sort of simplify and do fewer drops. And it just, it didn't work out for us. I'll just say that. We realize that people want variety. They want especially color. They want newness. And so we are you know now in a place where we're dropping new products at least you know at least one new you know color style a month if not more every single month and then from a from a promo standpoint a similar approach i think like a lot of brands i mean we have a lot of clove isms you know things we say i don't know if other brands say it this way but probably similar principle applies but we have like a promo pyramid basically if you think about a pyramid we've got our biggest sale of the year bf you know black friday cyber monday at the very top but then what's kind of the foundation you know underneath that we also will have like you know an evergreen gift with purchase let's say people uh you know for us it's something along the lines of people buy a pair of shoes we'll throw in a free pair of socks that's like an always-on offer and then you know most frequently we'll we'll do like a more exciting gwp where we're offering like a free tote or fanny pack or something like that that's you know high quality you know clove branded that's going to boost you know that's going to boost baseline performance and then you know next most common might be like a select item sale right and then or sorry yeah next most common would be that and then just maybe just below the top of the pyramid would be like a site-wide sale so we have maybe a couple site-wide sales a year culminating in and kind of black friday so that's like that's kind of how we think about it is like we need to always have something to talk about we understand that like that's going to be a you know foundational element to how we grow does that answer your question yeah very much and one of the priorities that you mentioned before is new customer acquisition right and to be fair everyone wants to acquire new customers with us right so what's your approach to acquiring new customers and what's something that worked for you and maybe that didn't work for you yeah so you know really we're attacking new customer acquisition from a variety of different angles you know creative strategy is a really a really big one and a super important one you know maybe now more than ever in the kind of andromeda era right where the meta algorithm has evolved and you know who sees your ad isn't just as simple as like what you're setting as the targeting right you know from and then from a targeting standpoint and as well from like a cro standpoint so there's a lot of different ways that we're attacking it and and i kind of like referenced this quote earlier and i'll bring in before we started the recording i'll reference it again now.

15:08We really like institutionally love this James Clear quote that you don't rise to the level of your goal, you fall to the level of your systems. So, you know, with all of these things, we're not shooting from the hip, we're not doing things ad hoc, we've really built sustainable and repeatable systems both on, you know, targeting and creative. So things that haven't worked, I mean, maybe one of the biggest things I could point to, I'll kind of lead with the punchline after making changes to creative and targeting now year for year we are spending like 60 to 70 percent less in a given month and making more revenue because of changes we made to targeting and to creative and one of the biggest mistakes that we made was really drinking the kool-aid on like advantage plus campaigns and smart plus and all this stuff right like meta's promise is basically boils down to trust me bro like hand me your keys in your wallet you know in your social security card go broad targeting and trust that as long as you're optimizing for a purchase like we're going to figure it out.

16:03Yeah, your CPM is going to be a little bit higher, but you know, your conversion rate is going to be better. We're going to, we're going to figure it out. That did not work for us. You know, that led to a bunch of problems. One of the things that I referenced, I can get into more about like our ill-fated foray into like broad audience marketing, because we were convinced that we were over-penetrated on healthcare. But before this turns into a long ramble, that's maybe the one thing I would point to as don't do this is be really intentional with your targeting. You need to build a very intentional, sophisticated funnel rather than just having a bunch of ASE campaigns where you're trusting Zuckerberg to spend your money wisely.

16:42Right. So definitely one thing I'll say is that different other type playbooks and there are like a thousand playbooks because there are thousands of other types. I respect everything. Of course, what I can tell you from experience is that we do well with both, But not every solution works for every brand. There's a brand, for example, we'll work with that catalog ads, they don't work for them. And for the others are the best performing one. We haven't found a way to run catalog ads. And it's like crazy. And when we onboarded them last year, they said catalog ads don't work for us. Are you crazy?

17:20Maybe for sure it's something that you have done wrong, right? And no, they don't work. So I believe you. So how do you approach targeting? Because it's been a while since the last time I discussed this over an episode. In fact, I interviewed, well, not only him, but many, you know, operators, marketers. And one of them is John Loomer. He's been on the podcast like four times. Once a year is the anniversary episode we do every January or so. And he talks about going broad as well. So what do you think that didn't work for Clo about going broad? And how do you approach the targeted, let's say, audiences with interest localized?

18:04What do you do? Yeah, I mean, so it's tough to answer why, you know, ASC didn't work. I mean, that's maybe a better question for the meta engineers. You know, on paper, it makes sense that like, hey, they're going to use the purchase signal that they're getting to make smarter decisions. But, you know, practically speaking, we found that that was just getting a lot of garbage in the top of the funnel. So what I can, maybe I'll back up and say, you know, we are fortunate in that we know who our target customer is. We make shoes for healthcare workers. And so that is our top of funnel targeting, right?

18:36And it's not even, I mean, at least, I won't go too far down the rabbit hole on this one, but there are something like, you know, 20 million healthcare workers in the United States or healthcare adjacent across, you know, a bunch of different disciplines. And like, we're not even necessarily targeting the entire 20 million because they're not all, not all created equal, right? There could be, you know, very wide gaps in terms of compensation, let's say between like a CNA and RN, LPN and so forth. So for various reasons, we concentrate on, you know, sort of a different bullseye than the entire addressable market.

19:06But those are the people that we're going after explicitly, you know, top of funnel campaigns, whether it's meta, whether it's TikTok, and so on, that's who's coming into the top of the funnel. And also an important element to this, getting into a little bit of the nuts and bolts is anytime we've ever tried to set up a campaign, a top of funnel campaign that is optimizing to something other than a purchase, it's garbage in, garbage out again, right? Your meta and Google reps are constantly going to tell you, oh, go further up the funnel, optimize for add to cart, landing page view, traffic, reach and frequency.

19:36Don't do it. It's a trap. Do not do it. Every single time we've done that, we get massive volume of people to the site and the quality is really, really, really bad. There's a reason for that, though. And I agree. Like, that's a different story. Like, meta will give you a subset of the audience who is most likely to perform the desired action, whether that's click, to engage, to view a video. So they'll give you that. If you want them to convert, whether it's a lead or a purchase, that's a different story. So, yeah, I'm with you. That's why it's always important to optimize for the end goal. Filling up the funnel from, let's say, the top with the actions doesn't work.

20:17So I didn't ask, but is Meta the number one channel that you use to generate new customers? So historically, yes. However, that is changing. And here we might delve a little bit into attribution. But, you know, based on how we're looking at the data, we're starting, we're noticing that, you know, while we're at a spend on meta where our incremental spend is not highly incremental in terms of the outcomes, TikTok, let's say, is kind of taking everything that we can throw at it. So that's been interesting. Like TikTok, I can just say at a high level is making up a larger slice of the pie than it has historically and is continuing to grow.

20:55Shop, organic or ads? Ads. Yeah. we have tested shop in the past and it worked okay there are now some more limitations around tiktok shop too in terms of like yeah i won't get bogged down in the details but there's just little weird idiosyncrasies like if you you know tag product and ad then you can't use it in other places it's it's a little strange so so you know the overwhelming majority of the ads that we're running are just pointing straight to the website hey that's right so basically it's meta tiktok and what about google google yep i mean we have tested on pretty much every platform you can imagine we've done snap we've done reddit app loving uh pinterest we've been on programmatic display we've done ctv we've done digital out of home out of home you know we've tried them all and you know at various points in time but you know i would say as with most advertisers probably agree with this you know kind of the trifecta the big three meta google and tiktok is really where it's at from a performance standpoint for us so before you mentioned creative strategy what does that mean in 2026 what's a good creative strategy and what's your creative strategy yeah so you know for us i kind of i kind of touched briefly on the you know building a better sort of purchase funnel and how that influences targeting and creative is really kind of hooks into that right we don't do kind of one size fits all creatives we have different we we look at you know creative sort of like multiple pieces to it there's sort of like a what are you saying and then there's how are you saying it?

22:22So what are you saying is like, what is the message we want people to take away? And how are you saying it comes down to, you know, maybe format, whether it's static or video, or is it UGC or what we call EGC, which is like employee generated content stuff that we're making in house. And so, you know, we're playing with all these different levers and we're starting to zero in on, okay, we know that in the top of the top of funnel for us, you know, if you go look at our ads library, if you go look in motion or Facebook ads library, you're going to notice we have a lot of ugc running like that just historically for us has been the best way to kind of meet people at the party right that's the best way for us to show up when people are not familiar with the brand um there's kind of baked in social proof right of like hey this person is not is not a you know clove employee you know yeah maybe they're getting a free pair of shoes out of it or whatever but like they they cared enough to like make this piece of content and then as you go further down the funnel both the messaging approach and the message itself like the takeaway change like we We know from post-purchase surveys, and we should talk more about post-purchase surveys because that's like something every advertiser needs for sure, for a variety of reasons.

23:24But we know from our post-purchase surveys that the number one reason people don't buy is price. So when people get to the bottom of the funnel and we know that they've consumed the content at the top and the middle of the funnel, we know that the number one objection they probably have at that point is price. So a lot of our ads at the bottom of funnel are going to talk about, you know, a firm or the fact that our shoes are approved to pay for with your, you know, health savings account, flex savings account, right? HSA, FSA, a little idiosyncrasy of the U.S. healthcare system, but you can use pre-tax dollars basically to pay for them.

23:53or a 30-day fit guarantee, you know, return policy, things like this, things that are basically touching on price. Like we, by this point, we assume that you've consumed the content further up the funnel about who we are, why you should care, you know, why you should replace your running shoes, let's say with a pair of clothes. And by the time you get to the bottom, we're really just helping you make that last decision to rationalize the purchase. So the creative strategy is basically understanding what works at these different funnel stages and maintaining this balance of like building on what works while still trying to raise the bar right and and kind of our we use a lot of metaphors silly metaphors at clove but like we talk about it as like a train right the you know the the train is like what's working and when we are testing something new that's like a caboose you know that we're putting on the back of the train right so it's like you know always be testing but don't bet the farm on like you know all your experimental mad scientist ads right and talking about strategy yeah probably i'll go there now you mentioned the post-purchase surveys and i think that among other zero-party data sources is so undervalued and underused absolutely what do you do with post-purchase surveys and what do you why do you say that you recommend everyone or every advertiser to leverage them yeah i mean we use we use it for a lot.

25:16So I'll touch on some of the main uses. So a big one that we use it for is just understanding the customer, right? At a very high level. So we know, you know, what is the, you know, gender mix, what percentage of the people who are purchasing are healthcare workers or not, right? It's very useful for attribution. This is maybe one of the biggest ones I would point to, you know, we have tried Rockerbox, we've tried Triplewell, we've tried Phospa, you know, I think maybe House and like Northbeam are the only attribution platforms we haven't tried yet. But the one thing that's really consistently been valuable for attribution has been the post-purchase survey data, right?

25:51We look at the relationship between how much spend, what percentage of our total budget does a given channel represent, and how many people who say they heard about us via paid channel actually mention that channel, right? So Meta is 70 % of our spend, but only 30 % of the people who say they heard about us via a paid channel are pointing out Facebook, that's a problem, right? That means that Facebook is probably not very incremental or that our spend is disproportionately high in relation to the percentage of people that claim that they heard about us through Facebook, right? And there's always going to be some discrepancy because of the gap between first touch and last touch and all that.

26:30But that has been instrumental in our weekly process of looking at, okay, what's the relationship between the spend and survey responses for these different channels and strategies and where does it make sense to you know reallocate budget yeah so besides these both podcasts i write a newsletter under the same name the ddc exiler and it's been going for a while as well and a few years ago i wrote a piece of a newsletter that said uh in a section that said read something like um the gold mine most brands ignore and I recently reposted it. That's why it's fresh. I'm not that good with memory. Yeah.

27:08It spoke about something similar and including post-purchase surveys as well. Hit send yourself. As well as other story I got. Yeah. So as well as other zero-party data sources such as reviews, CX tickets, it could be scraping like a first-party, you know, data, let's say your own, or it could be third-party, you know, scraping Reddit or other your competitors reviews as well. Why not? And trying to build a profile for your customers to see what they want and asking the right questions, not only for attribution purposes, which is fine. And one of the tools you mentioned, I won't say which one I can say offline, but I'm not, I don't want to create some kind of, yeah, to pick one over the others.

27:53But one of them does keep in mind the post-purchase survey in one of the models they have, but it's not perfect. You know, attribution is not perfect either. This is really important because you can improve your marketing. You can release better products if you know which questions to ask, which is in line with what we see people when they use AI. You know, we need to ask, we need to know which questions to ask. And the problem is that we as humans, unless we are trained on that, we don't know the questions we want to ask. right? We don't even know. So it's pretty tough. But if you know which questions to ask in a post-purchase survey, it's not only related to attribution, which is fine, but I don't know.

28:34Yeah. What need you add? Yeah, sorry. Yeah, all great points. Yeah. And I mean, just to touch on a couple other things quickly, you know, that we find really valuable, it's also understanding like, where are people coming from in terms of their product journey, right? So we ask, you know, hey, what shoes are you replacing? Or like, what shoes were you wearing before you switched? And, you know, that was a really powerful insight. It can inform your targeting and your creative strategy. So for us, we know that like over 70 % of people who are buying our shoes are replacing running shoes, right?

29:07Which I mean, it makes sense. Just we know that that is mostly what healthcare workers are wearing. Like we would, we know that because we see it when we go hang out, you know, in hospitals and we do these trade shows and stuff like we look at what people are wearing and it's a lot of hoka and on running and so maybe it could be something like what what did you hate about your previous shoes yeah so absolutely that yeah those are things that you can you know get of course in with volume get insights that will give you food for thought for product development marketing improvement paths why not so so we we we briefly discussed uh customer acquisition what about customer retention what do you do on that front yeah so i would to that i would say you know customer retention has really been a strong a strong point for us really from the beginning so we you know part of it is just making a good product right like we're a little bit of our own worst enemy in the sense that like we make really durable shoes right that last a long time so like our time between orders is relatively long but because we make a good shoe we inspire confidence and people come back you know and we know that most of the time again based on post purchase survey data, we ask, why are you buying another pair of shoes?

30:17We have a separate survey specifically for returning customers, right? So we can differentiate. And the main answer is because I wanted another pair. I wanted a different color. It's not because they were replacing a pair that fell apart. So big components in our customer retention, I mean, a lot of it is email and SMS, right? We have really built a better mousetrap and really an airtight system for our welcome and card abandon post-purchase and especially for retention, right? We have you know, customer win back and, you know, post-purchase and all of that. And we actually, like, I mean, if we're ever on a given day, if we're ever not profitable, it's almost always because we don't have enough new customers.

30:52Like we're golden on returning customers. That is just continually going up and up and up on an ongoing basis. You know, once people get in on their feet and they understand, you know, they can experience the difference and experience the benefits, you know, the non-slip, easy to clean, easy on, easy off. And they kind of like see, oh yes, okay, this is a revelation. Like we don't, we don't need to actually nudge them too much to come back and buy we still do but you know that's all part of the process i mean if i'm wrong but you either have a loyalty program as well right we do yeah and that's that's been a strong performer you know there was a lot of a lot of questions internally of like hey we make a durable product it's not something that people are buying every week you know or even every month you know our time between well i won't get into specifics there but it's like on the order of a few months let's And so initially, initially, there was some kind of anxiety or reluctance, you know, a thought that like people won't value it, but it's actually been a very consistent driver of incremental revenue.

31:47And I'd even say that Yotpo was using frequently under reports their incremental revenue. Like I do a detailed analysis where I, you know, get all of our purchaser data and I flag people as either redeemers or non-redeemers and I break it out by different cohorts. right like like one of the concerns that we had i'm rambling a little bit but one of the concerns we had is like the the reason that your loyalty program is going to look good is because there's a response bias you know your your best customers are going to gravitate towards the the program and then of course when you look at like the average revenue per customer for redeemers versus non redeemers it's going to skew in favor of the redeemers but it's not because the program is driving that behavior it's because they're just they're just a different persona but through my analysis like i break it out of like okay for the top one percent of spenders top five percent ten percent twenty percent breaking each one of those down into redeemers versus non-redeemers and in every case redeemers are more valuable than the non-redeemers in terms of dollars spent over the period being analyzed mostly driven like obviously the aov is going to be lower for redeemers because the discounts applied but they are buying more frequently over whatever period you look at so i would encourage anybody you know that's on the fence about it you might be surprised So on that, how do you avoid the fading when, you know, you when creating a loyalty program?

33:05Because I know that I know a lot of brands that they don't maybe they don't give enough time. Maybe they don't structure it well. And for some others, it works wonders. So how have you done it if you want to tell us? Yeah, I mean, I would say ours is a relatively we started with a relatively off the shelf approach. right like like like most loyalty programs the main way that you earn points is by making purchases right and you know to their credit the vendor we're working with you know gave us some guidance early on of like here's how you should sort of structure this to make it interesting you know based on our kind of industry best practices and there's other ways you can earn points like you know leave us a review or you know like you know follow us on instagram or whatever it is right there's a bunch of different ways refer a friend is another big one right and then the challenge becomes like, don't just set it and forget it, right?