Bonus: How Nate Lagos Quadrupled Original Grain with Persona-Based CRO

0:00We ran a Better Than Black Friday sale, November 1st through Thanksgiving. We offered you the normal Black Friday discount, but then we gave you a free$50 gift card to use on a future watch order. And that ripped. That got way more people to buy before BFCM, so we could more confidently scale up. Add to spend, the customers that bought before Thanksgiving had a 30 % higher LTV than any other customer cohort we've ever had. And a ton of people who were acquired on that deal came back for the following Valentine's Day or Father's Day. That kind of speaks to what I define as a great offer. It's like it works for acquisition and retention.

0:38That one was perfect.

0:47Welcome to the D2C podcast, Nate, and cheers. This is the first time I've ever had a glass of whiskey with someone. It's a Friday? Friday at 5. It's actually two my time, but this is my last appointment of the day. It's eight over here. It's eight over there. It's got to be after five somewhere. We're living proof of that. We're on the eve of the World Series here. I know you're a big baseball fan. I just want to say I've been enjoying following you over the years on DTC Twitter, following your journey. And so I just wanted to get on the podcast, drink some whiskey with you and talk over your big insights on the space.

1:21How are you doing? Thanks, man. So good to be here. I'm good. I just wrapped up my first week in my new job. Nice. I'm the CMO of Adapt Naturals. I'm in the supplement space now. Big LTV guy now, all of a sudden. So watch out for that. But it's good, man. Life's good. Let's just back up a little bit. Give me your hero's journey in this D2C marketing space. Yeah. Nate Legos, born in 1996. I'm a young 'un, just 29. Grew up outside of Boston. Baseball was life. I wanted to go far away for college, and I wanted to play baseball. the only place that would take me to do that some tiny division two you've never heard of here in south carolina but landed here majored in baseball but minored in marketing nice and uh from there was freelancing doing organic and paid social for my dorm my sophomore year for a couple brands in town one of them offered me a job the day i graduated uh bounced around a little bit but I really cut my teeth in e-com in the last two brands I was a part of.

2:25Dugout Mugs and Original Grain. Both sell things made out of wood that were highly giftable, crushed around the holidays of Christmas and Father's Day and Valentine's Day. So that's what I've been doing. And then a pretty big switch up to the supplements space now. But I think a lot of my skills are going to translate well here. Talk to me about the growth that you helped architect at Original Grain. It was big. It was a lot. It was fast. I got to OG, I think in year seven or eight of the business. Two brothers had started it. They launched on Kickstarter in like 2013, 2014. Back when Kickstarter was like the spot to launch and they crushed.

3:10I think they did like 700K in a matter of days. So they had a pretty quick come up. And then business matured a little bit. They were ready for another leg of profitable growth. And yeah, I mean, we ended up quadrupling in size from my first year there to my fourth. Last two years, we grew by 100%, 80 % on the back of a lot of great product, a lot of great marketing tactics from upgrading our creative quality to a lot of refining our core messaging and personas that we were selling into. And then some great partnerships as well. I mentioned before we hopped on the partnership we had with my good friends at Jack Daniels, other big billion dollar brands that we got to work with, all that, yeah, made for a rocket ship the last couple of years.

4:09We talked on the pre-interview quite a lot about CRO, but I wanted to talk first. I imagine the rocket fuel beyond CRO, the traffic coming in here, was it mostly meta? Are you a big meta guy? Yeah, big meta guy. Big meta guy. Hate to love it kind of relationship. But yeah, I mean, it's still the biggest and baddest advertising platform that's ever existed. Just sucks sometimes, you know? And you're a flea on its back, even when you're spending as much as you're spending. yeah like i know it's so funny how like you know i've spent i've probably spent 100 something million on there yeah and um i'll like my like dad will call me like i got logged out of my facebook can you talk to someone and get me back in i'm like dude i can't do anything like no i've had ad accounts should shut off like there's no they do not care about the 100 million or so i've given them, they've got much bigger fish to fry.

5:05My biggest flex in this entire space is that this year Meta is sponsoring the newsletter and podcast. No way. I'm like the only person I know. Send me that contact after this, please. Yeah, I do have these contacts. I'm the only person I know who Meta is giving me money. That's nuts. We're still giving them a lot more just to grow the newsletter. But yeah, it's a drop in the bucket. But super cool. Let's just talk about Andromeda. I know Andromeda is not new. Friends don't let friends say Andromeda is a new thing. It's been around for a long time. But you mentioned when you're talking about Original Grain, you're talking about upgrading your creative quality, talking about personas, which that's the whole language of Andromeda, right?

5:40Is sort of like marketing by persona rather than by segment in a way. Talk about that a little bit. Yeah. So this started for us long before Andromeda. You know, when I got there, I think it was early 2021, I immediately saw we had two very different cohorts of customers who bought from us. One was the rugged, tough guys like us, scholarly gentlemen who were buying watches for themselves. The other was our wives, our girlfriends, our moms, who actually make up the majority of our customer base that are buying watches for Valentine's Day, Father's Day, and Christmas. so we were forced into this kind of like persona marketing maybe a little ahead of the curve because you know for 10 months a year we need to market to the guys and then for two months a year we got to really market to their women like super hard so the personas thing was always kind of natural to us we always had dedicated campaigns and creative briefs targeted to whichever audience we wanted to speak to.

6:45And as we got further, we realized there were actually sub-personas within each of those groups as well. We had guys that are buying out of a sense of accomplishment. We had guys who were buying to mark a milestone. We had guys who were buying just because they felt so beat down by the world and they needed a little pick-me-up. So lots of research went into it, A lot of testing, messaging, and creative. I guess meta is how you test it, right? Yeah. Meta is how we test everything. And then some Intel Gems testing on our website too. But we uncovered it by reading reviews and comments. We hired Sarah Levenger over at Tether Insights to do a bunch of customer analysis for us.

7:32And yeah, we uncovered all these different personas that exist within the like, you know what i just say is like oh cool rough and tough and you know rugged guys there's a dozen different versions of that and they all have a different reason for purchasing and they all purchase during a different moment in their lives so that was like super eye-opening to us and then we test messaging on our website first once we get some messaging to increase conversions on the site then we roll out ad creative for it and we were able to scale up super well so then andromeda came and we're like, cool, we're doing this.

8:05We're doing this already. We don't have to change. We've been saying creative is the new targeting for three years now or whatever since iOS 14. And so you guys are living it. You mentioned in the pre-interview a lot about CRO. You actually, when I said like, what's the one biggest lever, like you got, you were talking about like that, that CRO journey you went on. And when you've got these different avatars, do you speak, do you run them to landing pages so that they're getting their avatar all the way through? Do you just make sure the page speaks to all of them? How do you, how do you do that?

8:30The more specifically we can speak to the audience, the better. So when we first started testing this, we would speak to the majority. So we knew coming up for Christmas, we should target the women. All of the copy everywhere on our site was focused at female gift givers. more recently we got a little more advanced we had specific ad campaigns and sets going towards the sub personas where now someone is seeing you know male accomplishment focused ads they are going to a male accomplishment focused lp um so got more dialed in and more complex over time but again step one was just like hey it's christmas let's make sure we're talking to the gift givers, but ramping up that kind of complexity because it was based in a bunch of good customer research was definitely the right move.

9:25And then just talk about generally about the CRO moves you made and what impact you were able to have with that. Yeah. So I think it was my second year at OG. We had spent like a hundred percent more money on ads. Site traffic was up like 90 per percent. And we were like, great, that's good. But revenue is only up like 50%. And we were like, that's not good something something went wrong here and i had like you know i'd heard about cro but i'd never done anything that i would call cro up to that point um so we talked a couple of cro agencies we talked to a couple different softwares that promised to help uh we found our way over to intelligems um which is a self-serve split testing site for shopify brands And I think I had a meeting with their founder.

10:13We were one of their first customers. And he showed me how to set up like one split test. At first, we wanted to test the price of one of our core products. I emailed him three days later with 17 different split tests set up. And I was like, hey, I think there's a problem. I think a lot of these tests are overlapping. And I broke it. And he was like, yeah, you did. He's like, I love the enthusiasm. But yeah, you're going a little too crazy here. This is Drew, former podcast alumni, yeah. So that was kind of the start of it, testing prices and offers. Then we got into testing all the messaging.

10:52But we just found it so impactful that when we get a small win, a 10 % uplift in conversion on a price or a messaging test, that doesn't just make one ad work better. That doesn't make just one email or one campaign work better. It improved performance across the business. So we really narrowed in on our website as our core testing ground and as our biggest performance lever for the biz because getting a win on the homepage or getting a win on our best-selling SKU or the highest traffic LP wasn't just going to make one ad work better. It was going to make the business work better. Did you attend or catch, I'm sure you caught the buzz around this debate series between Mr.

11:37Charlie Titchener, who I met in 2018 at my event that I put on in Las Vegas. And he had blue hair and nail polish back then. And he was telling me about the disruptors. And then I saw disruptors was in his Twitter handle. I actually got him hired at Pilothouse. We actually employed him for a good chunk of time, which was interesting. He's a great... I've always had a good experience with him, but he just is a lightning rod for controversy. And so Jordan Menard, who I also know well, is taking advantage of that. So let me just frame the central debate there is Jordan saying, okay, meta needs creative.

12:11You need to constantly be fueling the beast with creative. And Charlie's sort of saying, no, you don't. You don't need to. If you have good creative, you only need a small amount of good creative. You don't need to, and you don't need to be feeding it all the time. What do you understand about the debate and where do you lie on it? Yeah, I think as simply as I can put it, you should produce great creative, period. If you can produce a lot of it, great. If you can't, that's fine. Just make it good. And when I say good, I'm not talking about production value or design. I am talking about creative that speaks to your target's real pain points, their real motivations for buying.

12:50Setting a quantity goal is wrong for anything in life. What else in life do we measure by? How many times can I do this? How good am I at it? How much is it working? How much is it paying off? I met Charlie through Twitter years ago, and then we met in Austin, I think it was 2022, at Whaley's. We had followed each other on Twitter, and I think he texted me and said, Hey, I'm going to eat meat. Do you want to come? And I was like, Yes, that's the kind of text that I want to get. I think the way he thinks about growing brands makes a ton of sense, focused on long-term health of the business and long-term cash flow over day one CAC or ROAS.

13:34I think that matters a ton. I don't know, Jordan, at all, on the volume versus, I don't know, not volume approach, make great creative. And I think for us at OG and what I hope to do at ADAPT, early on in my time there, I think we could only produce four great ads a week. So that's what we did. And then the next year we could produce 10. And then the next year we could produce 25. And then the next year we could produce 40. And that was more than enough to fuel our growth. And yeah, we just wanted to make sure it was really good before we tried to think about increasing quantity. And to double, like you already laid out exactly how to think about that, which is going not just like what your customer is doing or who they are, but why they're doing what they're doing.

14:20getting to that, like in a systematic scientific way, unearthing the real, not the wise you think as a founder, but the wise that they're actually using their product. The other thing that I've, that I've heard a lot of is like, what is that product replacing in their lives? Like, what are you actually competing against for those dollars? You know what I mean? Like in your case with the, with the watch, it could be any number of things for any number of those cohorts. Right. And it's like that, that mind frame is what can allow you to create great creative, I think. right 100 yeah like when i first got to to og like i probably would have answered the the question why someone is buying from us i'd be like well because our watches are inlaid with whiskey barrel wood and that's cool that's why they chose that watch that's not why they bought from us that's not why they were searching for something to buy um and i think that's super important and we talked about the personas already but i think like the competitor analysis matters a ton too because I stopped looking at other watch companies as our only competitors.

15:20When I'm selling to gifters, I'm competing against any gift for guys, golf clubs, dress shirts, bottles of whiskey. I'm competing against all of those things. A woman is just trying to show how much she appreciates her husband. There's a million different ways she can do that, but that's the motivation that I'm competing for. Turning our attention to your new gift, What's your title at the new gig? I'm the chief marketing officer back in the C-suite. It feels good. Welcome to the C-suite. I became a CMO at 24. Whoa. And then, yeah, Flex. I had no clue what I was doing at all. What size of company?

15:59He did 8 million that year. That's a real CMO? First year. Thanks. Did not feel like a real CMO. But that's what got me into D2C Twitter. I got this insane opportunity. opportunity. I was a freelancer for them for like a year. And then they're like, Doug out. Yeah. Yeah. Cause I had Chris on the podcast as well. Yeah. And, uh, they were like, Hey, come run all of marketing for us. I was like, great. And then I immediately Googled like, what is the head of marketing do? Who are other CMOs? I can follow and figure it out on the fly. But yeah. And then I was always a director or VP at OG kind of heard the ego a little bit, but back in the C-suite now life's good.

16:40And you're going to a consumable. You're going from a product that maybe people will buy two of for very special occasions. Maybe there's a few people that buy a lot more, but you're going to something that has an opportunity to become part of someone's life in an ongoing way. Is anything that changes in your mindset about going to a company like that versus where you came from? Other than a sigh of relief that we're going to get some great LTV behavior? No, I mean, a lot of the tactics won't change. We still need to test messaging. We still need to optimize the customer journey. We still have to understand each of the personas that we're selling to.

17:17What changes is how we model and forecast and plan for growth because we can obviously bake in some predicted LTV. But a lot of the tactics don't change. One of the core reasons I joined Adapt is consumables in general, but especially when you have a product as great as ours, it's just a great business model. We are selling something awesome that people are more than willing to buy month after month after month. So for me, I don't think a ton changes. I think just what me and the marketing team can do is going to be amplified by great repeat purchase behavior. And you have started or you're about to start?

17:58I started on Monday, so five days in. Five days in. Very cool. You're also a new father? New father. Just had a daughter. Yeah. Congrats. Oh, man. What an exciting time in your life. Yeah, it's busy. Yeah, I bet. We're headed into Q4 here. And one of the questions, do you know who Jason Kriske is? He's a friend of mine who's been in direct market for a really long time. But his favorite question, he thinks I should ask more, is what's the best offer you've ever run and why do you think it worked so well? Best offer I've ever run. That's a good question. it is i should have prepped you i think i've got it good it was uh it was at og being in the watch industry and i'll say like our products were good like we had a solid repeat purchase behavior considering the category that we were in but increasing ltb was like always a goal of ours we know if we can sell you a second watch um without a 150 dollar cac we profit a bunch so our our best offer at og we rolled it out three years ago and we've done it every year since we ran a better than black friday sale from november 1st through thanksgiving uh where we offered you the normal black friday discount but then we gave you a free 50 gift card to use on a future watch order and that ripped that got way more people to buy before bfcm so we could more confidently scale up at ad spend the customers that bought before thanksgiving had a 30 higher ltv than any other customer cohort we've ever had and a ton of people who were acquired on that deal came back for the following valentine's day or father's day so yeah or even black friday if you've got that if you've got that coupon even just the actual black friday probably had people do that yeah yeah so i think like that kind of speaks to what i define as a great offers.

19:51Like it works for acquisition and retention. Um, and that one was perfect. And then in the supplement world is, is bundling a big, like, but like it's all about like your AOV, what are, what are your, I know it's only five days in, but what are your thoughts about sort of maximizing AOV in the, uh, supplement world? If you can, without sacrificing, you know, what your 12 month LTV is, I think that's awesome. I think maximizing AOV is like pretty good advice for most brands. And I think especially with how bad inflation's been since COVID, I think more people should raise their prices and I think more people should test higher priced offers because everyone uses their own personal price anchors, right?

20:31Like a week of groceries used to cost us 200 bucks. Now it's 300. So now if I'm considering a$300 purchase, that's only one week of groceries that's not a week and a half it's not two weeks of groceries so i think the numbers are getting bigger uh i mean our currency's screwed not let's do it let's talk about that uh but um yeah i think uh testing higher priced offers is a great move and the the way that i kind of think about it and explain it to people it's like listen you have customers let's say 10 percent of your customers are rich give them a chance to give you more money like don't turn them down like the biggest orders we used to get at at og were for our highest price 400 watch and then we started to roll out some thousand dollar bundles and some 1500 bundles and all of a sudden we start getting orders for 1500 bucks we didn't develop any new products we just bundled them together.

21:39So rich people are going to come to your website and shop. Give them the chance to give you more money. I think it's great advice. And it's like every single, and this is not the best point, but it's like we're, the grocery store is raising the prices. Every grocery store is raising all your prices and you have all these owners and founders being precious about whether or not they should raise their prices. But like every week we're getting stared in the face with higher prices. So it's not uncommon. You know what I mean? Yeah. Well, and I think it's actually It's funny that I'm sipping on this Jack Daniel 12-year whiskey here.

22:11Oh, lovely. I've got Elijah Craig, by the way, if we're doing product placement, I'm open to sponsorship, Elijah. But a regular bottle of Jack costs$25. I think I spent$300 on this one because it's a specialty one. And that's the example I'm explaining here. It's like if Jack didn't think they could go more premium and didn't think they could get a more affluent group of whiskey drinkers to buy from them, I wouldn't have given – they might have only got$300 out of me all year if I'm just buying$25 bottles. But no, they got it all in one here. When it comes to what you want to do at the new company, I imagine your bag is still going to be of a heavy focus on Meta, CRO.

22:52Are there any other platforms or approaches that you're looking forward to testing that maybe you haven't as much in the past? Yeah, there's going to be some new channel expansion. I don't know what those are going to be yet. Maybe some YouTube, maybe some programmatic, probably a lot of influencer affiliate world. I think what I'm most excited for is a lot of that offer testing. You know, where we promote and distribute that offer, we'll figure it out. But I think that's what's so cool about these businesses is balancing day one performance of an offer and then how that affects 3, 6, and 12-month LTV.

23:29I think that's going to be a really fascinating puzzle to kind of get into. There's a lot that goes into it, and the existing marketing team at Adapt has already done a good job testing a bunch, and we've learned a lot. So I'm downloading all that info. But yeah, I think that's going to be where I'm actually able to do some damage and produce hopefully some big wins. That's cool. How big of a team will you be leading? We've got – I don't even know, to be honest. It's a mix of agency and in-house right now. A couple of great full-time employees, a couple of big DTC Twitter agencies. and then the founder has been acting as the kind of head of growth CMO for a while.

24:12He's not a marketer by trade. He's a doctor, but he's done a great job, grown it so far. So looking forward to leaning on all those folks early on to help us keep growing. What's your leadership style like or what's your approach? I think everyone's remote in most situations. I assume it's the same for you. How are you focusing on alignment and management leadership in this role? Yeah, I love managing remote teams. I think people work better when they're comfortable. If you're one of those employees that likes to be in an office, good for you. It's not me. I don't think it'll ever be me. No, me neither.

24:49And it's funny, going through this past job interview cycle that I just went through, I had a couple of folks that wanted me to work in office for four or five days a week. And I told them I would, but I told them it came with a price. And I told them all that price was quadruple my asking price to stay remote. And they thought I was kidding. And I'm like, no, I'm not kidding. Like, you want me to drive somewhere every day at 8 a.m.? No, that's going to cost you. It just happened. Like at Pilot House, we went from like 19 employees to like, you know, over 120 in one year kind of thing. It was insane, insane growth.

25:28And we did it all from home. So it's like there was just no – that just launched us into a, you know, a remote team forever because you can't tell that team that did that that you got to come back in office, right? No, for sure. And it would have quadrupled or it would have like 10X'd our office costs. It would have like all these things. I feel like there's so, you see so many like old timey entrepreneurs, you know, saying you gotta be in, you don't see enough people really sticking up for the obvious fact that working remote is being amazing when you're aligned. Here's the thing. I never want to manage an employee who I feel like I might have to babysit or keep an eye on to make sure they do their jobs.

26:03You know what I mean? I mean, like if there's someone on your remote team who you think is taking advantage of it and slacking off, you should fire them whether you work remotely or in office. Like they're not a good teammate if you are feeling like they might be trying to take advantage of it. So, you know, I like working remote, paying people well. And then the only thing it takes is just, you know, a little extra effort on communication and organization to make sure stuff isn't slipping through the cracks, to make sure everyone's getting their work done on time. And then to also make sure we're not over indexing on meetings.

26:37I think there's a lot of communication that would happen in office that might take a minute that sometimes we turn into 15-minute meetings because we're remote. And it feels like, oh, well, we hopped on a call. We can't just talk for a minute then leave. So, yeah, Slack, Asana, Twist, Notion are all my friends. And, yeah, it's just about keeping everyone aligned on the big goals for the business. We want to grow. We have growth metrics we want to hit. I'm currently giving the team my vision for how we do that. And as long as everyone stays aligned on that, then I have no doubt we're going to be very productive.

27:17Why do you think so many marketers are also like closet conspiracy theorists? Dude, because I think we recognize patterns. That's my answer too. It's pattern recognition. I think it's patterns and then some communication stuff. And it's all branding, right? If we rewind to 1962, we're at the height of the Cold War. The Russian space program is embarrassing ours. And our president makes a bold claim that we're going to go to the moon this decade. NASA only started in 1958. NASA's four years old. And he says they're going to the moon within the next seven. The following summer, JFK is murdered. Now NASA has to live up to that promise.

28:04our late president made, who was loved by most of the country. Every rocket we sent up exploded. We were struggling. What would you do if you needed to get a win for the country? Yeah. To bring it back to marketing, it's kind of like when you start seeing the ways in which truth is created, it helps you understand that's what you're doing as a marketer as well in a lot of ways is you're trying to create a truth for a consumer. So there's a real connection there. If the content is convincing enough, you can get people to believe whatever you want. When you realize it's all psyops all the way down, then you get good at your own psyops, right?

28:44That's all marketing is. I went to our Slack channel that we're in and I said, what should I ask Nate? And I thought I was going to get a bunch of joke questions, but I got some good questions. So I thought I would ask, what are your mental frameworks or rituals before sitting down to write copy besides ChatGPT? Oh, great question. First of all, it depends. There's like two main creative moods I'm in. It's either 9 a.m., 9.30, after I just played nine holds of golf, and this one is going to be very, very research-based. I am reading reviews. I'm reading summaries of review analysis from chat. I'm reading things about persuasive psychology and different methods to get someone to act the way I want them to.