WEBVTT

1
00:00:00.000 --> 00:00:04.760
If you wanted to hit 3 million next year, I was like, we could do 10 million next year.

2
00:00:04.760 --> 00:00:07.600
I would just say we're going to take all of our resources, we're going to go all in on

3
00:00:07.600 --> 00:00:11.160
TikTok, viral, organic, and you're going to deploy everything into TikTok shop and get

4
00:00:11.160 --> 00:00:16.000
influences to do lives for you, showing all these funny gadgets because like the trophies

5
00:00:16.000 --> 00:00:20.800
are so built for shareability, yeah.

6
00:00:20.800 --> 00:00:21.800
What's up?

7
00:00:21.800 --> 00:00:22.800
How have you done?

8
00:00:22.800 --> 00:00:23.800
Good.

9
00:00:23.800 --> 00:00:24.800
Awesome.

10
00:00:24.800 --> 00:00:25.800
Let's talk about trophies.

11
00:00:25.800 --> 00:00:26.800
Yeah.

12
00:00:26.800 --> 00:00:27.800
So my name's Cody.

13
00:00:27.800 --> 00:00:28.800
Cody Schultzen.

14
00:00:28.800 --> 00:00:36.000
So last year we did about $1.72 million revenue, mainly trophies and awards personalization,

15
00:00:36.000 --> 00:00:41.880
about $110,000 in profit, 6.4% net margin, and I'm their generation owner of the company

16
00:00:41.880 --> 00:00:43.600
and business for almost 40 years.

17
00:00:43.600 --> 00:00:44.600
That's amazing.

18
00:00:44.600 --> 00:00:45.600
Yeah.

19
00:00:45.600 --> 00:00:46.600
Kind of fun.

20
00:00:46.600 --> 00:00:47.600
So what's the goal?

21
00:00:47.600 --> 00:00:49.200
The goal is $3.5 million in revenue.

22
00:00:49.200 --> 00:00:51.840
I really want a double revenue going in here.

23
00:00:51.840 --> 00:00:52.840
This year?

24
00:00:52.840 --> 00:00:53.840
Yeah.

25
00:00:53.840 --> 00:00:54.840
Okay.

26
00:00:54.840 --> 00:00:55.840
I think we can do it.

27
00:00:55.840 --> 00:00:56.840
So who do you help?

28
00:00:56.840 --> 00:01:01.660
Mainly it coaches event organizers as well as businesses and organizations, which is

29
00:01:01.660 --> 00:01:07.560
like HR departments, business owners, sales managers, people like that, as well as

30
00:01:07.560 --> 00:01:08.560
get gift purchasers.

31
00:01:08.560 --> 00:01:09.560
I got that far.

32
00:01:09.560 --> 00:01:10.560
Yeah.

33
00:01:10.560 --> 00:01:11.560
Okay.

34
00:01:11.560 --> 00:01:12.560
So how do you help them?

35
00:01:12.560 --> 00:01:15.040
So we have a free and gravy, fast shipping.

36
00:01:15.040 --> 00:01:18.600
Everything we do is personalized to the business or the individual, something like that.

37
00:01:18.600 --> 00:01:22.800
They go to the website, to our platform, purchase, you know, add the personalization info,

38
00:01:22.800 --> 00:01:24.600
the logo, things like that.

39
00:01:24.600 --> 00:01:28.720
And then we fill it if it needs approval, anything like that, but most things ship in one

40
00:01:28.720 --> 00:01:29.720
to two days.

41
00:01:29.720 --> 00:01:30.720
So.

42
00:01:30.720 --> 00:01:31.720
It's weekly.

43
00:01:31.720 --> 00:01:32.920
So how do you make money?

44
00:01:32.920 --> 00:01:33.920
How do we make money?

45
00:01:33.920 --> 00:01:34.920
All right.

46
00:01:34.920 --> 00:01:39.160
So on our website, direct on our website, most of our products kind of land in that $100

47
00:01:39.160 --> 00:01:41.040
to $150 price point.

48
00:01:41.040 --> 00:01:44.240
We have products that range from $4 all the way up to $900.

49
00:01:44.240 --> 00:01:46.120
So it's a wide range.

50
00:01:46.120 --> 00:01:51.920
Most popular item is a 45 and 6 foot trophy, which kind of lands about $89 to $130.

51
00:01:51.920 --> 00:01:55.520
And then dashplex, which are like little car show things that guys collect when they go

52
00:01:55.520 --> 00:01:56.520
to car shows.

53
00:01:56.520 --> 00:02:01.080
And yeah, so it's kind of selling for $1.25, minimum 50, but we sell thousands of them

54
00:02:01.080 --> 00:02:02.080
a year.

55
00:02:02.080 --> 00:02:03.080
I've even heard of that.

56
00:02:03.080 --> 00:02:04.080
Yeah.

57
00:02:04.080 --> 00:02:05.960
There's like these little pieces of metal that people just, they have these big boards

58
00:02:05.960 --> 00:02:06.960
that they set out of car shifts.

59
00:02:06.960 --> 00:02:07.960
It's kind of funny, actually.

60
00:02:07.960 --> 00:02:10.680
I've always made so many ways to make money there.

61
00:02:10.680 --> 00:02:11.680
Right.

62
00:02:11.680 --> 00:02:13.680
And that's one of the things that our company was starting on.

63
00:02:13.680 --> 00:02:14.680
Oh, that's kind of fun.

64
00:02:14.680 --> 00:02:15.680
So how do you get customers?

65
00:02:15.680 --> 00:02:16.680
trophy all started in 1985.

66
00:02:16.680 --> 00:02:19.480
So almost, you know, this is our 40th year.

67
00:02:19.480 --> 00:02:24.960
And we've launched our Etsy of business in 2019 and we did about $70,000 the first

68
00:02:24.960 --> 00:02:25.960
year.

69
00:02:25.960 --> 00:02:30.400
And then in 2013 or 2023, we launched Amazon and it did about $300,000.

70
00:02:30.400 --> 00:02:35.800
And then last year, we launched a top shop and we did about $270,000 in revenue.

71
00:02:35.800 --> 00:02:38.760
But 250 of that came in December alone.

72
00:02:38.760 --> 00:02:42.320
So we had a video go viral with 20 plus million views.

73
00:02:42.320 --> 00:02:43.320
So it went crazy.

74
00:02:43.320 --> 00:02:44.800
So 250 of that came in in one month.

75
00:02:44.800 --> 00:02:45.800
So that was kind of fun.

76
00:02:45.800 --> 00:02:46.800
And you sold those.

77
00:02:46.800 --> 00:02:47.800
We sold those.

78
00:02:47.800 --> 00:02:48.800
Yeah.

79
00:02:48.800 --> 00:02:49.800
They're appropriate.

80
00:02:49.800 --> 00:02:53.360
But yeah, little death signs that people bought for their boss or it was kind of fun.

81
00:02:53.360 --> 00:02:55.280
But that was a little crazy for December.

82
00:02:55.280 --> 00:02:56.480
No, I love that.

83
00:02:56.480 --> 00:02:59.080
And you were able to fulfill on the amount of orders that came in.

84
00:02:59.080 --> 00:03:00.080
Yeah.

85
00:03:00.080 --> 00:03:01.080
Yeah.

86
00:03:01.080 --> 00:03:02.080
We did about 13,000 of those.

87
00:03:02.080 --> 00:03:03.560
So do you have any factoring set up?

88
00:03:03.560 --> 00:03:04.560
Like do you?

89
00:03:04.560 --> 00:03:05.560
Yeah, we produce everything in house.

90
00:03:05.560 --> 00:03:06.560
So we engraved cut.

91
00:03:06.560 --> 00:03:07.560
Cool.

92
00:03:07.560 --> 00:03:08.560
All it.

93
00:03:08.560 --> 00:03:09.560
Ship it.

94
00:03:09.560 --> 00:03:10.560
Sweet.

95
00:03:10.560 --> 00:03:11.560
Okay.

96
00:03:11.560 --> 00:03:12.560
Across four different channels.

97
00:03:12.560 --> 00:03:15.960
Most of our clients come through online and internal is through SEO and Facebook ads.

98
00:03:15.960 --> 00:03:20.600
We just launched Facebook ads and met about October, November with an agency.

99
00:03:20.600 --> 00:03:21.600
Yeah.

100
00:03:21.600 --> 00:03:22.600
And then Amazon.

101
00:03:22.600 --> 00:03:26.080
We spent about $7,100 a month between the agency and ads and then Etsy and then TikTok

102
00:03:26.080 --> 00:03:28.960
still kind of figuring that one out a little bit since it all happened in December.

103
00:03:28.960 --> 00:03:31.960
But about $2,000 so far and ads there.

104
00:03:31.960 --> 00:03:35.400
So well, how many customers have you have you sold so far?

105
00:03:35.400 --> 00:03:36.400
Yeah.

106
00:03:36.400 --> 00:03:40.280
So in 2024, direct on our website and I have this broken out per channel in a couple

107
00:03:40.280 --> 00:03:41.280
slides.

108
00:03:41.280 --> 00:03:47.120
Total visits is about 90,000 visits to our site, about 2,500 orders, it's a 2.8% conversion

109
00:03:47.120 --> 00:03:50.800
rate and about 781 products, so that's a lot of products.

110
00:03:50.800 --> 00:03:54.200
So do you carry all those or is everything everything made to order?

111
00:03:54.200 --> 00:03:55.200
Yeah.

112
00:03:55.200 --> 00:03:56.200
Okay.

113
00:03:56.200 --> 00:03:58.800
So it's not so it's not like you're carrying a ton of inventory like you've got raw materials

114
00:03:58.800 --> 00:03:59.800
and the raw materials.

115
00:03:59.800 --> 00:04:02.640
Most of it we bring in from our vendors to kind of as we need it.

116
00:04:02.640 --> 00:04:03.640
We don't care.

117
00:04:03.640 --> 00:04:04.640
Okay.

118
00:04:04.640 --> 00:04:05.640
You choose.

119
00:04:05.640 --> 00:04:07.880
You know, except for like the death signs and stuff, we'll kind of stock those up.

120
00:04:07.880 --> 00:04:08.880
Okay.

121
00:04:08.880 --> 00:04:11.560
It's crazy, but that's kind of an exception to the rule.

122
00:04:11.560 --> 00:04:12.560
All right.

123
00:04:12.560 --> 00:04:14.960
Then what's been holding you back?

124
00:04:14.960 --> 00:04:16.800
So I think it's marketing.

125
00:04:16.800 --> 00:04:20.200
Fulfillment wise, we proved that in December, we can handle about double fulfillment.

126
00:04:20.200 --> 00:04:22.200
I mean, with limited complexity.

127
00:04:22.200 --> 00:04:26.440
So I just need more people to the site, more people buying and we can fill it.

128
00:04:26.440 --> 00:04:28.800
So also very product heavy with low margins.

129
00:04:28.800 --> 00:04:32.120
So we're going on the margin piece, getting profits up a little bit.

130
00:04:32.120 --> 00:04:37.040
So do you want to like sell this company eventually or like what's the, I need to do you want

131
00:04:37.040 --> 00:04:38.040
to double?

132
00:04:38.040 --> 00:04:41.360
We really had any thoughts of selling, but I want to create a business that is sellable.

133
00:04:41.360 --> 00:04:42.360
Yeah.

134
00:04:42.360 --> 00:04:45.200
So I have the option if I want to sell or no, but I would love for it to be a fourth generation

135
00:04:45.200 --> 00:04:46.200
business someday.

136
00:04:46.200 --> 00:04:49.760
If that's an option, but yeah, that's kind of the ultimate goal.

137
00:04:49.760 --> 00:04:50.760
All right.

138
00:04:50.760 --> 00:04:53.000
So how many locations do you have because you've brick and mortar, correct?

139
00:04:53.000 --> 00:04:55.320
Well, we have one retail location now.

140
00:04:55.320 --> 00:04:57.400
We have two locations total.

141
00:04:57.400 --> 00:05:00.640
We closed the other retail location down in this production only facility.

142
00:05:00.640 --> 00:05:01.640
Okay.

143
00:05:01.640 --> 00:05:06.880
So the other retail location, you know, does maybe $150,000 in revenue out of that location.

144
00:05:06.880 --> 00:05:09.960
So just like walk in traffic and whatever, walk in email stuff.

145
00:05:09.960 --> 00:05:10.960
Is it pretty given?

146
00:05:10.960 --> 00:05:11.960
Not really.

147
00:05:11.960 --> 00:05:12.960
Okay.

148
00:05:12.960 --> 00:05:13.960
Okay.

149
00:05:13.960 --> 00:05:14.960
So you have a manufacturer facility in one retail.

150
00:05:14.960 --> 00:05:15.960
Yeah.

151
00:05:15.960 --> 00:05:16.960
Which also does some manufacturing as well.

152
00:05:16.960 --> 00:05:17.960
Yeah.

153
00:05:17.960 --> 00:05:20.120
Is there any downside to just like consolidating to the one?

154
00:05:20.120 --> 00:05:21.600
It's something that we're actually looking at.

155
00:05:21.600 --> 00:05:22.600
Okay.

156
00:05:22.600 --> 00:05:26.360
And go more e-commerce and kind of cut in the, yeah, the retail business.

157
00:05:26.360 --> 00:05:28.280
I mean, most of our stuff's e-commerce anyway.

158
00:05:28.280 --> 00:05:30.160
So I mean, online retails.

159
00:05:30.160 --> 00:05:31.760
I think it's going anywhere.

160
00:05:31.760 --> 00:05:33.680
And I don't think many people were like, you know, I'm going to go to the trophy store

161
00:05:33.680 --> 00:05:34.680
today.

162
00:05:34.680 --> 00:05:35.680
Yeah.

163
00:05:35.680 --> 00:05:36.680
Yeah.

164
00:05:36.680 --> 00:05:37.680
I like all my luck.

165
00:05:37.680 --> 00:05:38.680
I like a little shit.

166
00:05:38.680 --> 00:05:39.680
Yeah.

167
00:05:39.680 --> 00:05:40.680
But transfer video tapes and then go to the trophy store.

168
00:05:40.680 --> 00:05:41.680
Right.

169
00:05:41.680 --> 00:05:42.680
So these are the issues.

170
00:05:42.680 --> 00:05:43.680
What are the metrics you got?

171
00:05:43.680 --> 00:05:44.680
Yeah.

172
00:05:44.680 --> 00:05:48.200
So number is 1.72 million in revenue, about $110,000 in profit, 40% gross margin.

173
00:05:48.200 --> 00:05:51.000
What do they expect to gross margins to be higher for this business?

174
00:05:51.000 --> 00:05:52.000
And it varies per product.

175
00:05:52.000 --> 00:05:54.760
You got tons of, you know, like certain acrylics.

176
00:05:54.760 --> 00:05:58.000
I was expecting like, you know, one, like, you buy these trophies and they're like, you

177
00:05:58.000 --> 00:06:01.480
know, a dollar and you're like, there's no, like, this is made of rubber, you know,

178
00:06:01.480 --> 00:06:02.480
but yeah.

179
00:06:02.480 --> 00:06:03.480
Okay.

180
00:06:03.480 --> 00:06:07.120
That's a very widely between the products and platform and stuff like that.

181
00:06:07.120 --> 00:06:15.480
But in that margin, about 6.4% LTV, 133 and then CAC 1190 LTV to CAC ratio 11 to 1.

182
00:06:15.480 --> 00:06:17.240
And that's blended across all channels.

183
00:06:17.240 --> 00:06:18.760
How do you come up with pricing?

184
00:06:18.760 --> 00:06:23.240
I'm guessing for the most part, or I'll look at some competitors, but there's not really

185
00:06:23.240 --> 00:06:25.480
good apples to apples comparison necessarily.

186
00:06:25.480 --> 00:06:28.320
Do you have like a, do you like the cost plus or like?

187
00:06:28.320 --> 00:06:29.320
Yeah.

188
00:06:29.880 --> 00:06:33.680
Massive spreadsheets of all of our costs, you know, things like that, factor in labor.

189
00:06:33.680 --> 00:06:35.520
And then I just kind of add my margins to it.

190
00:06:35.520 --> 00:06:39.520
And, you know, they've slowly been trying to bring that up over the years.

191
00:06:39.520 --> 00:06:43.680
What percentage of customers are, are new versus return?

192
00:06:43.680 --> 00:06:49.800
God, I would say probably just on our website and internal customers, probably 50, 50.

193
00:06:49.800 --> 00:06:50.800
Okay.

194
00:06:50.800 --> 00:06:54.000
Because even as a world business, I think there'd be a decent amount of return.

195
00:06:54.000 --> 00:06:55.000
Yeah.

196
00:06:55.000 --> 00:06:58.440
A lot of our business, I mean, $530 in revenue comes just internal.

197
00:06:58.440 --> 00:07:03.400
So emails, calls, things like that, most of that is rep, is repeat business.

198
00:07:03.400 --> 00:07:05.320
Do you have very high fixed costs in this business?

199
00:07:05.320 --> 00:07:07.120
Not too bad, no.

200
00:07:07.120 --> 00:07:10.480
Because if you have half the business comes in from word of mouth, I would expect the

201
00:07:10.480 --> 00:07:12.840
margins to be higher, like the net margins.

202
00:07:12.840 --> 00:07:16.600
Because I wonder like, is it, I just think of, think of this as big hypothetical.

203
00:07:16.600 --> 00:07:20.640
It's like if we got rid of all of the new customers, right?

204
00:07:20.640 --> 00:07:25.280
And we just sold the 500 and something thousand from return customers.

205
00:07:25.280 --> 00:07:29.840
It should be free customer acquisition and then we should make money.

206
00:07:29.840 --> 00:07:30.840
Yeah.

207
00:07:30.840 --> 00:07:31.840
Right.

208
00:07:31.840 --> 00:07:32.840
Right.

209
00:07:32.840 --> 00:07:34.120
But looking at this, I'd be like, I don't know if we would make money.

210
00:07:34.120 --> 00:07:35.120
Yeah.

211
00:07:35.120 --> 00:07:36.120
Our cogs are pretty high.

212
00:07:36.120 --> 00:07:37.120
I do think there's a pricing issue.

213
00:07:37.120 --> 00:07:38.120
Yeah.

214
00:07:38.120 --> 00:07:39.120
Which we'll get to.

215
00:07:39.120 --> 00:07:40.120
Okay.

216
00:07:40.120 --> 00:07:41.120
Okay.

217
00:07:41.120 --> 00:07:42.120
This is good.

218
00:07:42.120 --> 00:07:43.120
But your LTVCACs are pretty strong.

219
00:07:43.120 --> 00:07:44.120
Yeah.

220
00:07:44.120 --> 00:07:45.120
It looks like.

221
00:07:45.120 --> 00:07:46.120
Yeah.

222
00:07:46.120 --> 00:07:47.120
It's pretty decent.

223
00:07:47.120 --> 00:07:48.120
And I learned that a few months ago coming here the first time.

224
00:07:48.120 --> 00:07:49.120
So I started increasing.

225
00:07:49.120 --> 00:07:50.120
And it has, it's not like some revenue.

226
00:07:50.120 --> 00:07:51.520
It's like this versus profit.

227
00:07:51.520 --> 00:07:52.520
That's profit.

228
00:07:52.520 --> 00:07:53.520
Okay.

229
00:07:53.520 --> 00:07:54.520
Yeah.

230
00:07:54.520 --> 00:07:58.440
So I'd like to estimate people stay about three years, excluding at the Amazon.

231
00:07:58.440 --> 00:07:59.440
Yeah.

232
00:07:59.440 --> 00:08:00.440
Those ones are a little hard to calculate.

233
00:08:00.440 --> 00:08:03.640
But through trophy alley, they order really from consistently.

234
00:08:03.640 --> 00:08:06.880
We've got customers been with us for 30 years, you know, things like that.

235
00:08:06.880 --> 00:08:10.080
So, so pretty heavy repeat business there.

236
00:08:10.080 --> 00:08:12.160
Once we get a customer, they're fairly sticky.

237
00:08:12.160 --> 00:08:16.440
So with pricing, I'm gonna, I'm gonna head on this one because it's, I'm almost positive.

238
00:08:16.440 --> 00:08:17.440
There's a big pricing issue.

239
00:08:17.440 --> 00:08:18.440
Yeah.

240
00:08:18.440 --> 00:08:19.440
Who was in charge of pricing that upside?

241
00:08:19.440 --> 00:08:21.400
Like you took it over from your, I guess he took it from his old man.

242
00:08:21.400 --> 00:08:22.400
So like your third generation.

243
00:08:22.400 --> 00:08:23.400
Yeah.

244
00:08:23.400 --> 00:08:25.760
My parents ran the company and they didn't have a price structure.

245
00:08:25.760 --> 00:08:29.200
They just kind of, and on an annual basis, do you review all prices?

246
00:08:29.200 --> 00:08:30.200
Every year.

247
00:08:30.200 --> 00:08:31.200
Yeah.

248
00:08:31.200 --> 00:08:34.320
And just about February, March of every year is when our vendors raised prices.

249
00:08:34.320 --> 00:08:37.080
So then I adjust accordingly, got it.

250
00:08:37.080 --> 00:08:39.520
Was there margins the same when they were running it?

251
00:08:39.520 --> 00:08:40.520
Much less.

252
00:08:40.520 --> 00:08:41.520
Lower.

253
00:08:41.520 --> 00:08:43.040
Oh, wait, like nothing making money at all.

254
00:08:43.040 --> 00:08:44.440
So my mom was running it.

255
00:08:44.440 --> 00:08:50.200
I remember very distinctly looking at a product and the cogs on that were like $50 and

256
00:08:50.200 --> 00:08:51.720
we were selling it for like $45.

257
00:08:52.280 --> 00:08:53.960
I mean, this is our work.

258
00:08:53.960 --> 00:08:54.960
Yeah.

259
00:08:54.960 --> 00:08:55.960
So I immediately raised prices.

260
00:08:55.960 --> 00:08:56.960
Yeah.

261
00:08:56.960 --> 00:08:57.960
Like, you know, doubled them almost.

262
00:08:57.960 --> 00:08:58.960
Okay.

263
00:08:58.960 --> 00:09:00.200
And then constantly just continually up them.

264
00:09:00.200 --> 00:09:01.200
Yeah.

265
00:09:01.200 --> 00:09:02.200
I think I have some ideas there.

266
00:09:02.200 --> 00:09:03.200
All right.

267
00:09:03.200 --> 00:09:04.200
What else you got?

268
00:09:04.200 --> 00:09:05.200
All right.

269
00:09:05.200 --> 00:09:06.200
So channel breakdown.

270
00:09:06.200 --> 00:09:12.000
So direct traffic and internal is our, you know, biggest 13 to 1, LTV to CAC ratio, Amazon

271
00:09:12.000 --> 00:09:18.600
our highest conversion rate, and 9.6% conversion, and of course the, the blended 11 to 1 LTV

272
00:09:18.600 --> 00:09:19.600
to CAC.

273
00:09:19.600 --> 00:09:20.600
So.

274
00:09:20.600 --> 00:09:21.600
Interesting.

275
00:09:21.600 --> 00:09:23.240
So you don't have LTV metrics on TikTok?

276
00:09:23.240 --> 00:09:24.240
No.

277
00:09:24.240 --> 00:09:25.240
Couldn't quite figure that out.

278
00:09:25.240 --> 00:09:26.240
Yeah.

279
00:09:26.240 --> 00:09:27.240
Okay.

280
00:09:27.240 --> 00:09:30.440
Well, the easiest way to do it is just go a total revenue divided by a total number of customers.

281
00:09:30.440 --> 00:09:31.440
So you did 262.

282
00:09:31.440 --> 00:09:32.440
Do you know me?

283
00:09:32.440 --> 00:09:33.440
Customers are sold.

284
00:09:33.440 --> 00:09:35.440
Think about almost 13,000.

285
00:09:35.440 --> 00:09:36.440
Customs.

286
00:09:36.440 --> 00:09:37.440
13,000.

287
00:09:37.440 --> 00:09:38.440
So.

288
00:09:38.440 --> 00:09:39.440
Okay.

289
00:09:39.440 --> 00:09:40.440
So 20 bucks.

290
00:09:40.440 --> 00:09:41.440
That's how to buy, right?

291
00:09:41.440 --> 00:09:42.440
Average.

292
00:09:42.440 --> 00:09:43.440
Yeah.

293
00:09:43.440 --> 00:09:44.440
Unless they have a Georgia value, right?

294
00:09:44.440 --> 00:09:45.440
We just don't know how many times they've purchased.

295
00:09:45.440 --> 00:09:46.440
Right.

296
00:09:46.440 --> 00:09:47.440
Which is one as of this.

297
00:09:47.440 --> 00:09:48.440
You know.

298
00:09:48.440 --> 00:09:51.160
This is that might be artificially inflating your LTV to CAC, which is because you have zero

299
00:09:51.160 --> 00:09:52.160
CAC there.

300
00:09:52.160 --> 00:09:53.160
Okay.

301
00:09:53.160 --> 00:09:54.160
Or did you not?

302
00:09:54.160 --> 00:09:55.160
Did you not?

303
00:09:55.160 --> 00:09:56.160
No, that's actually it.

304
00:09:56.160 --> 00:09:57.160
We skipped it all.

305
00:09:57.160 --> 00:09:58.160
We skipped it all.

306
00:09:58.160 --> 00:09:59.160
We skipped it all.

307
00:09:59.160 --> 00:10:00.160
Yeah.

308
00:10:00.160 --> 00:10:01.160
So you want a double revenue.

309
00:10:01.160 --> 00:10:02.160
Yep.

310
00:10:02.160 --> 00:10:03.160
Got it.

311
00:10:03.160 --> 00:10:04.160
What's this side here about you wanting to buy another business?

312
00:10:04.160 --> 00:10:05.160
Yeah.

313
00:10:05.160 --> 00:10:06.160
So I had a business reach out to me.

314
00:10:06.160 --> 00:10:07.160
That's in the same industry.

315
00:10:07.160 --> 00:10:09.160
In the St. Louis market that we're already in.

316
00:10:09.160 --> 00:10:10.160
So he's getting old.

317
00:10:10.160 --> 00:10:11.160
He wants to retire.

318
00:10:11.160 --> 00:10:12.920
What's he doing in revenue and profit?

319
00:10:12.920 --> 00:10:15.760
He does about double what we do, about three million in revenue.

320
00:10:15.760 --> 00:10:16.760
Mm-hmm.

321
00:10:16.760 --> 00:10:19.560
We haven't even got to that point yet.

322
00:10:19.560 --> 00:10:24.640
But he's got a, from what I understand, he does pretty decent on his margins just through

323
00:10:24.640 --> 00:10:26.880
communicating and talking to him.

324
00:10:26.880 --> 00:10:30.000
He does a lot more custom stuff, so there's a lot higher margin on some of that stuff.

325
00:10:30.000 --> 00:10:34.160
He has a lot of bigger orders, which is nice, so he can bring it in from China or from

326
00:10:34.160 --> 00:10:36.960
elsewhere and keeps his margins low.

327
00:10:36.960 --> 00:10:37.960
Mm-hmm.

328
00:10:37.960 --> 00:10:38.960
He keeps his margin higher.

329
00:10:38.960 --> 00:10:39.960
I'm sorry.

330
00:10:39.960 --> 00:10:40.960
Yeah.

331
00:10:40.960 --> 00:10:41.960
I got you.

332
00:10:41.960 --> 00:10:45.200
The biggest concern with him is 70% of his revenue comes through one customer.

333
00:10:45.200 --> 00:10:46.200
Yeah.

334
00:10:46.200 --> 00:10:49.120
So that's a pretty big, uh, prepping by that.

335
00:10:49.120 --> 00:10:50.120
Wouldn't buy that.

336
00:10:50.120 --> 00:10:51.120
Mm-hmm.

337
00:10:51.120 --> 00:10:52.120
Gotcha.

338
00:10:52.120 --> 00:10:54.520
I would try and find out if I could who the vendors were that he has in China for his

339
00:10:54.520 --> 00:10:58.880
connections for his raw materials, so that I could try and use those vendors.

340
00:10:58.880 --> 00:10:59.880
Yeah.

341
00:10:59.880 --> 00:11:02.600
That was actually one resource that I thought was, well, if I could buy this and it's

342
00:11:02.600 --> 00:11:03.600
cheap enough.

343
00:11:03.600 --> 00:11:04.600
It's monstrous customer risk.

344
00:11:04.600 --> 00:11:09.440
And especially if you have somebody retiring, that one customer might be.

345
00:11:09.440 --> 00:11:13.960
Even if he was willing to stay on for two, three years, four years to help that transition.

346
00:11:13.960 --> 00:11:16.720
Well, part of it is what kind of business do we want to build, right?

347
00:11:16.720 --> 00:11:21.600
So you just want to like, you're, you're, you're considering closing down the first location.

348
00:11:21.600 --> 00:11:24.400
We have to, basically, there's a bet that we have to make, which is like, do we think

349
00:11:24.400 --> 00:11:27.880
that the future of this business model has lots of brick and mortar locations?

350
00:11:27.880 --> 00:11:31.840
If so, then we have to focus on the brick and mortar model in a lot more detail with

351
00:11:31.840 --> 00:11:37.600
the unique and economic terminal capital or it's, we're going to be online.

352
00:11:37.600 --> 00:11:39.480
And if you're online, then why bother?

353
00:11:39.480 --> 00:11:41.480
Which most of his stuff is shipped as well.

354
00:11:41.480 --> 00:11:42.480
It's not retail business.

355
00:11:42.880 --> 00:11:43.920
I mean, it's not brick and mortar.

356
00:11:43.920 --> 00:11:44.920
Yeah.

357
00:11:44.920 --> 00:11:48.520
I mean, he has a retail store front, but most of his business isn't, isn't online.

358
00:11:48.520 --> 00:11:49.520
Yeah.

359
00:11:49.520 --> 00:11:50.520
But it's 70%.

360
00:11:50.520 --> 00:11:51.520
It's not necessarily online.

361
00:11:51.520 --> 00:11:52.520
It's through, basically wholesale.

362
00:11:52.520 --> 00:11:53.520
Yeah.

363
00:11:53.520 --> 00:11:56.320
It's customers that sell, you know, to large, large clients, things like that.

364
00:11:56.320 --> 00:11:58.320
So that's a super, I'm thrilled about it.

365
00:11:58.320 --> 00:11:59.320
Yeah.

366
00:11:59.320 --> 00:12:00.720
One, there's the customer risk.

367
00:12:00.720 --> 00:12:03.120
The other thing is it's like, it's not the business that you're, even though you're

368
00:12:03.120 --> 00:12:06.960
obviously in the trophy business, it's like, it's not actually how it's basically all

369
00:12:06.960 --> 00:12:07.960
net new.

370
00:12:07.960 --> 00:12:11.760
It's like B2B versus B2C because we have to think about all available moves on the board.

371
00:12:11.760 --> 00:12:15.280
It's not just like this, because like, said differently, if he had an email, do you

372
00:12:15.280 --> 00:12:16.960
would you have approached him?

373
00:12:16.960 --> 00:12:21.080
I would have actually kind of pursued it a little bit just to get the information.

374
00:12:21.080 --> 00:12:24.320
I was a connection through our event, one of our vendors, so that's how I got to know

375
00:12:24.320 --> 00:12:25.320
him.

376
00:12:25.320 --> 00:12:28.320
Well, I'll zoom out from the, from back forward, which is like, what do we want to be

377
00:12:28.320 --> 00:12:29.320
when we grow up?

378
00:12:29.320 --> 00:12:33.920
Basically, this is going to become a media slash marketing business that monetizes through

379
00:12:33.920 --> 00:12:34.920
trophies.

380
00:12:34.920 --> 00:12:35.920
Right.

381
00:12:35.920 --> 00:12:40.840
Or you can go the B2B wholesale route, which is probably like outbound sales team that's

382
00:12:40.840 --> 00:12:44.080
calling wholesalers and whatnot.

383
00:12:44.080 --> 00:12:49.640
From what it sounds like, it sounds like you're better suited for the e-commerce direct

384
00:12:49.640 --> 00:12:50.640
to consumer side.

385
00:12:50.640 --> 00:12:51.640
That's what it sounds like.

386
00:12:51.640 --> 00:12:52.640
I don't know.

387
00:12:52.640 --> 00:12:53.640
Currently, that's where we're at.

388
00:12:53.640 --> 00:12:59.440
We do some wholesale currently, and it's just easier, but that just kind of came matrily.

389
00:12:59.440 --> 00:13:04.160
It wasn't anything we pursue, necessarily, but it's all e-commerce.

390
00:13:04.160 --> 00:13:09.200
You might have one of the simpler plans that I have, which is, I mean, simple doesn't

391
00:13:09.200 --> 00:13:10.200
mean bad.

392
00:13:10.200 --> 00:13:11.200
Simple is good.

393
00:13:11.200 --> 00:13:14.400
Sometimes you have like 10 things to do, it's better than three that move the needle a lot.

394
00:13:14.400 --> 00:13:16.320
And I think you're kind of in that situation.

395
00:13:16.320 --> 00:13:20.760
There's three big things, but I think we'll want you come over here, and then we'll net

396
00:13:20.760 --> 00:13:23.120
it out.

397
00:13:23.120 --> 00:13:25.760
What percentage of customers are gag gifts?

398
00:13:25.760 --> 00:13:29.960
So that's the Amazon Etsy tick tock, tick tock, I don't know that.

399
00:13:29.960 --> 00:13:32.120
So it's like four of the words, isn't it?

400
00:13:32.120 --> 00:13:33.120
Yeah.

401
00:13:33.120 --> 00:13:34.120
Roughly.

402
00:13:34.120 --> 00:13:35.800
And that's kind of been the fastest growing since 2019.

403
00:13:35.800 --> 00:13:37.800
That's for sure when we launched that.

404
00:13:37.800 --> 00:13:41.080
Which is all under a different brand technically.

405
00:13:41.080 --> 00:13:44.560
We started a different brand back then, because we don't want the explicit vulgar to be under

406
00:13:44.560 --> 00:13:45.560
trophy out.

407
00:13:45.560 --> 00:13:46.560
Sure.

408
00:13:46.560 --> 00:13:47.560
You know, church moms and stuff.

409
00:13:47.560 --> 00:13:48.560
Yeah.

410
00:13:48.560 --> 00:13:49.560
Yeah.

411
00:13:49.560 --> 00:13:52.960
With this business, like fundamentally, you just have, it's, you've traffic in a conversion

412
00:13:52.960 --> 00:13:53.960
pitch.

413
00:13:53.960 --> 00:13:58.000
And then if you already have, let's call it for right now, not a constraint on manufacturer

414
00:13:58.000 --> 00:13:59.400
or anything like that.

415
00:13:59.400 --> 00:14:06.120
The three big kind of levers that I want to go off of is number one is consolidation.

416
00:14:07.000 --> 00:14:09.640
Pricing, which also instantly has to profit.

417
00:14:09.640 --> 00:14:10.640
Absolutely.

418
00:14:10.640 --> 00:14:11.840
And then you do.

419
00:14:11.840 --> 00:14:18.200
So from a common solidation perspective, we have the skews, right?

420
00:14:18.200 --> 00:14:19.200
Yep.

421
00:14:19.200 --> 00:14:23.160
And then we also have the brick and mortar locations.

422
00:14:23.160 --> 00:14:26.160
And then we kind of have like model, so that like in terms of like how I'm thinking through

423
00:14:26.160 --> 00:14:27.160
this.

424
00:14:27.160 --> 00:14:30.480
So from a skew's perspective, if you're not carrying that like normally, I'd be like,

425
00:14:30.480 --> 00:14:34.160
we need to massively cut down on skew, but like if you're not, if you don't like this

426
00:14:34.160 --> 00:14:37.480
warehouse full of stuff and it's just like more options for people to purchase, I don't

427
00:14:37.480 --> 00:14:39.840
think we need to like get rid of anything.

428
00:14:39.840 --> 00:14:44.600
And a lot of the skews too, it's the same product just maybe for the ball versus

429
00:14:44.600 --> 00:14:45.600
ball.

430
00:14:45.600 --> 00:14:46.600
Yeah.

431
00:14:46.600 --> 00:14:47.600
Right.

432
00:14:47.600 --> 00:14:48.600
It's a, it's a goat trophy.

433
00:14:48.600 --> 00:14:49.600
And you just put a different plaque on it.

434
00:14:49.600 --> 00:14:50.600
That doesn't bug me.

435
00:14:50.600 --> 00:14:53.200
And if you're like, man, it's, it's super hard for my team to build all these different things

436
00:14:53.200 --> 00:14:55.400
that I'd be like, all right, well, then we should, we should look at that.

437
00:14:55.400 --> 00:14:59.120
But if it, it doesn't seem like your stress on the manufacturing side, but that's where

438
00:14:59.120 --> 00:15:00.120
my skill set lies to.

439
00:15:00.120 --> 00:15:01.120
Okay.

440
00:15:01.120 --> 00:15:02.120
As operations.

441
00:15:02.120 --> 00:15:03.120
No, that's good.

442
00:15:03.120 --> 00:15:04.120
Oh, it's the worst constraint, right?

443
00:15:04.120 --> 00:15:06.200
So the second is the brick and mortar, right?

444
00:15:06.200 --> 00:15:07.200
Yeah.

445
00:15:07.200 --> 00:15:11.840
So if you have this reach to location and it's basically breaking even or losing money,

446
00:15:11.840 --> 00:15:15.280
and that's not even the future of the business, then to me, I would say let's just save

447
00:15:15.280 --> 00:15:18.840
our 50,000 a year in rent and then just add that to the bottom line.

448
00:15:18.840 --> 00:15:19.840
Right.

449
00:15:19.840 --> 00:15:23.480
I feel like that would be a good idea because that would increase profit by 50% just like

450
00:15:23.480 --> 00:15:24.480
show pretty much instantly.

451
00:15:24.480 --> 00:15:25.480
Yeah.

452
00:15:25.480 --> 00:15:28.320
And also, there's just like the headache of like, it's this thing over here.

453
00:15:28.320 --> 00:15:29.320
Yeah.

454
00:15:29.320 --> 00:15:33.120
And you can probably just take the couple of good people from there, bringing them to bring

455
00:15:33.120 --> 00:15:34.120
them home, right?

456
00:15:34.120 --> 00:15:35.120
Yeah.

457
00:15:35.120 --> 00:15:36.120
Yeah.

458
00:15:36.120 --> 00:15:37.120
So that feels good.

459
00:15:37.120 --> 00:15:38.840
So the next one is model.

460
00:15:38.840 --> 00:15:44.240
So this is the thing that I'm really like, I don't know, torn on, at least for me, what

461
00:15:44.240 --> 00:15:49.440
appears to be the obvious solution is to go on the, where, where the fast growth is,

462
00:15:49.440 --> 00:15:50.440
right?

463
00:15:50.440 --> 00:15:52.000
Which is the gag gift thing.

464
00:15:52.000 --> 00:15:56.640
The problem is that there's zero kind of reoccurring nature of that, right?

465
00:15:56.640 --> 00:16:00.800
So it's basically like when you have that business, you have essentially a media arbitrage

466
00:16:00.800 --> 00:16:04.360
business where it costs you almost nothing, you get a customer, you make a spread.

467
00:16:04.360 --> 00:16:05.920
And then that's the business you're in.

468
00:16:05.920 --> 00:16:09.240
And every month you're going to be looking for, how do I make new media?

469
00:16:09.240 --> 00:16:12.000
And that's, that's the game you're in.

470
00:16:12.000 --> 00:16:16.040
If you want to go, I want to just get every league in the nation.

471
00:16:16.040 --> 00:16:19.000
Like if you were like, this is like, if I wanted to make this the most viable version

472
00:16:19.000 --> 00:16:22.440
of the business, not necessarily make the most money today, but the most viable version

473
00:16:22.440 --> 00:16:26.840
of the business, it would be, I'm going to be really targeted with the few avatars you

474
00:16:26.840 --> 00:16:32.440
have, like, leagues, event organizers, whatever, and say, like, these are the four avatars

475
00:16:32.440 --> 00:16:33.440
we have.

476
00:16:33.440 --> 00:16:37.640
And we're going to be targeted with our ads for those people and our SEO and the whole

477
00:16:37.640 --> 00:16:40.440
businesses around, like, we only deal with customers.

478
00:16:40.440 --> 00:16:43.640
And I would probably even say that you've, do you have phone sales or anything like that

479
00:16:43.640 --> 00:16:50.440
or some, or email to, what's the average order value for the, for the, like, a week?

480
00:16:50.440 --> 00:16:54.440
So internal orders, I think it's like, obviously, it was like 350 or something like that.

481
00:16:54.440 --> 00:16:55.440
I have a job.

482
00:16:55.440 --> 00:16:56.440
So it's a higher order value.

483
00:16:56.440 --> 00:16:57.440
Sure.

484
00:16:57.440 --> 00:16:58.440
Okay.

485
00:16:58.440 --> 00:17:03.040
Because I wonder if, in some ways, you have two businesses, let alone, like, you were, like,

486
00:17:03.040 --> 00:17:05.800
forget about the third one, you're thinking about buying, like, you already have two.

487
00:17:05.800 --> 00:17:06.800
And I'd rather have one.

488
00:17:06.800 --> 00:17:08.320
I'm not saying cut the one that you have.

489
00:17:08.320 --> 00:17:11.880
It's obviously a 40 year old business, but like, I really have to make that decision.

490
00:17:11.880 --> 00:17:14.760
And that, that's actually not a meat decision, it's a U decision.

491
00:17:14.760 --> 00:17:18.600
So I'll say it the way that I think Laila, Laila loves framing opportunities this week,

492
00:17:18.600 --> 00:17:20.880
because I always think about upside, Joe, things about downside.

493
00:17:20.880 --> 00:17:23.480
And so it's like, what, what problem would you rather solve?

494
00:17:23.480 --> 00:17:27.600
So in the gag gift path, the problem that you're going to have to solve is you're always

495
00:17:27.600 --> 00:17:29.840
going to have to find new, cheap forms of media.

496
00:17:29.840 --> 00:17:32.600
So it's going to be like TikTok shop is what it does today and live shopping.

497
00:17:32.600 --> 00:17:34.560
And that'll probably be good for another year or two.

498
00:17:34.560 --> 00:17:37.080
And then it's like, that'll start to get more expensive and other people compete.

499
00:17:37.080 --> 00:17:40.880
And it's like, then you're going to be in the next, whatever the next game is.

500
00:17:40.880 --> 00:17:45.720
And you just can have to get really good paid ads and creative and conversion optimization

501
00:17:45.720 --> 00:17:48.720
on the site, increasing average order, that kind of stuff.

502
00:17:48.720 --> 00:17:56.720
The other path is you build either an outbound sales team, so that they can sell these,

503
00:17:56.720 --> 00:18:00.920
these kind of B2B offerings that are, you know, or B2C if you want to consider the fantasy

504
00:18:00.920 --> 00:18:01.920
leagues.

505
00:18:01.920 --> 00:18:06.400
And or just like a meta, just like a simple meta ad strategy that would lead people to call

506
00:18:06.400 --> 00:18:08.520
the number functionally.

507
00:18:08.520 --> 00:18:13.840
And then there you're saying, cool, our goal is to be your trophy provider for life.

508
00:18:13.840 --> 00:18:15.600
And I think the fact that your 40-year business sounds really good.

509
00:18:15.600 --> 00:18:17.240
It's like, hey, we're 40-year business.

510
00:18:17.240 --> 00:18:19.120
Our goal is to be your manufacturer for life.

511
00:18:19.120 --> 00:18:20.560
And so of course, we're going to do this one.

512
00:18:20.560 --> 00:18:25.040
But if you want, we'll also give you 20% off next year if you make the order now or

513
00:18:25.040 --> 00:18:26.040
about now.

514
00:18:26.040 --> 00:18:27.040
I don't know.

515
00:18:27.040 --> 00:18:28.040
I play around with that.

516
00:18:28.040 --> 00:18:33.360
But which of the two paths sounds like the life you want to live?

517
00:18:33.360 --> 00:18:34.360
That's tough.

518
00:18:34.360 --> 00:18:38.000
Only because media for me has always been a hurdle.

519
00:18:38.000 --> 00:18:39.000
Do you like it?

520
00:18:39.000 --> 00:18:40.000
Okay.

521
00:18:40.000 --> 00:18:41.000
Fair.

522
00:18:41.000 --> 00:18:42.000
I will do it.

523
00:18:42.000 --> 00:18:43.000
But I don't know that I love it per se.

524
00:18:43.000 --> 00:18:45.960
Because if you wanted to hit $3 million next year, I was like, we could do $10 million next

525
00:18:45.960 --> 00:18:46.960
year.

526
00:18:46.960 --> 00:18:49.120
I would just say we're going to take all of our resources.

527
00:18:49.120 --> 00:18:52.640
We're going to go all in on TikTok viral organic and you're going to play everything

528
00:18:52.640 --> 00:18:57.540
in a TikTok shop and get influences to do lives for you, showing all these funny gag

529
00:18:57.540 --> 00:18:58.540
gifts.

530
00:18:58.540 --> 00:19:02.320
Because the trophies are so built for shareability.

531
00:19:02.320 --> 00:19:05.320
And so that's, I mean, 20 million views is a monster video.

532
00:19:05.320 --> 00:19:08.800
I think if that was all you focused on, you would be able to figure out because these

533
00:19:08.800 --> 00:19:09.800
are funny.

534
00:19:09.800 --> 00:19:10.800
Right.

535
00:19:10.800 --> 00:19:15.640
There's a little skit scenarios where people, you know, walk in and they see the boss

536
00:19:15.640 --> 00:19:20.800
is thick or they change their plate or, you know, someone loses and then it just says

537
00:19:20.800 --> 00:19:24.560
like biggest loser, you know, like that cut like the negative versions.

538
00:19:24.560 --> 00:19:26.640
I think that would just make for really viral content.

539
00:19:26.640 --> 00:19:31.280
And I feel like that would be easier to replicate just constantly doing that.

540
00:19:31.280 --> 00:19:36.160
The league's thing is like that's the very stable version of this business.

541
00:19:36.160 --> 00:19:39.840
And if you did ultimately want to sell in the future, you being able to go to a potential

542
00:19:39.840 --> 00:19:45.200
buyer and saying like, I have 5,000 leagues that buy our trophies from us every year and

543
00:19:45.200 --> 00:19:49.400
leagues on average stay for 12 years, you know, like guys who do fantasy or whatever it

544
00:19:49.400 --> 00:19:50.400
is.

545
00:19:50.400 --> 00:19:53.520
It's like, that's fairly, you know, that's a pretty, that's a pretty real current business.

546
00:19:53.520 --> 00:19:57.480
You know, that's a, that's a, that's a pretty good business harder to build though and

547
00:19:57.480 --> 00:19:58.480
slower.

548
00:19:58.480 --> 00:19:59.480
Right.

549
00:19:59.480 --> 00:20:00.480
That's also why it has more.

550
00:20:00.480 --> 00:20:05.840
So that's the, so if, if between those two paths, the like I would like to just make

551
00:20:05.840 --> 00:20:09.320
more profit now and potentially scale faster, then we can talk about the media version

552
00:20:09.320 --> 00:20:10.320
of this.

553
00:20:10.320 --> 00:20:11.320
I think that's probably where I would.

554
00:20:11.320 --> 00:20:12.320
Okay.

555
00:20:12.320 --> 00:20:13.320
Cool.

556
00:20:13.320 --> 00:20:16.520
So first things first is we're going to consolidate attention.

557
00:20:16.520 --> 00:20:21.800
So we're going to shut down losing location.

558
00:20:21.800 --> 00:20:29.880
So that should right off the bat, be a plus 50% improvement to profit, which is great.

559
00:20:29.880 --> 00:20:33.640
And I think it could be more than that because your attention is going to not be split anymore

560
00:20:33.640 --> 00:20:34.640
by two locations.

561
00:20:34.640 --> 00:20:35.640
Okay.

562
00:20:35.880 --> 00:20:40.760
The second thing, you have basically something called a cost plus model.

563
00:20:40.760 --> 00:20:45.120
You look at your costs and then you add a margin in and whatever and a lot of businesses

564
00:20:45.120 --> 00:20:47.880
do it because it seems very logical.

565
00:20:47.880 --> 00:20:50.560
The problem is every business I know that does a cost plus model doesn't make a lot of

566
00:20:50.560 --> 00:20:51.560
money.

567
00:20:51.560 --> 00:20:56.160
And so you want to switch to value based pricing, which is purely based on what someone's

568
00:20:56.160 --> 00:20:58.640
willingness to pay is.

569
00:20:58.640 --> 00:21:01.520
And that could be unlimited and it doesn't matter what your stuff costs because why do

570
00:21:01.520 --> 00:21:03.200
they care what it costs, right?

571
00:21:03.200 --> 00:21:10.800
And so basically like as your vendors increase their costs to you, in some ways, it shouldn't

572
00:21:10.800 --> 00:21:16.320
have any effect on the price of what you sell because the price of what you sell is completely

573
00:21:16.320 --> 00:21:19.040
the divorce of that and based on what somebody's willing to pay.

574
00:21:19.040 --> 00:21:23.200
So in terms of how we can do this, there's a couple of thoughts here.

575
00:21:23.200 --> 00:21:28.600
So a, which will seem a little bit less scary is I would consider this to sound crazy,

576
00:21:28.600 --> 00:21:36.000
but like monthly, like 5% price increases, like just keep going and just keep going.

577
00:21:36.000 --> 00:21:38.240
That is like path one.

578
00:21:38.240 --> 00:21:42.000
And the thing is is that every time you raise the price by 5%, you double your profit or

579
00:21:42.000 --> 00:21:43.000
almost 6%.

580
00:21:43.000 --> 00:21:45.920
If you want to be like, Hey, I doubled my profit this month and the next month you can raise

581
00:21:45.920 --> 00:21:49.680
by 6% and then more than double because it's 6% times the 6% right?

582
00:21:49.680 --> 00:21:51.640
So that is that is one way.

583
00:21:51.640 --> 00:21:58.520
The other way is that you just start immediately split testing kind of like 80 20 on your highest

584
00:21:58.520 --> 00:22:00.760
sales velocity items.

585
00:22:00.760 --> 00:22:03.600
And so this is simple, right?

586
00:22:03.600 --> 00:22:04.600
This is simple to do.

587
00:22:04.600 --> 00:22:07.280
You have to do any thinking you just add it and that's what it is.

588
00:22:07.280 --> 00:22:09.200
This one will probably get you more profit faster.

589
00:22:09.200 --> 00:22:10.600
It just takes a little bit more thought.

590
00:22:10.600 --> 00:22:15.520
So you'll take those 4, 4 foot, 5 foot, 6 foot trophies and just start like just keep bumping

591
00:22:15.520 --> 00:22:19.120
the price and just seeing what conversion it looks like because what we're trying to optimize

592
00:22:19.120 --> 00:22:20.120
for it.

593
00:22:20.120 --> 00:22:21.120
Did you have an engineering background?

594
00:22:21.120 --> 00:22:22.120
Okay.

595
00:22:22.120 --> 00:22:23.120
You said you were good at the manufacturing.

596
00:22:23.120 --> 00:22:24.120
So dad came from manufacturing.

597
00:22:24.120 --> 00:22:25.120
Okay.

598
00:22:25.120 --> 00:22:26.120
I'll pick it up there.

599
00:22:26.120 --> 00:22:27.120
Yeah.

600
00:22:27.120 --> 00:22:33.720
So what you're trying to optimize for is gross profit times a unit sold.

601
00:22:33.720 --> 00:22:37.400
And so if you think about it, it's like, you know, down here, it's like I'll have a ton

602
00:22:37.400 --> 00:22:44.360
of sales velocity, but I'll have low low margins versus here, I'll have fewer, you know,

603
00:22:44.360 --> 00:22:45.360
fewer items sold.

604
00:22:45.360 --> 00:22:49.280
But it's like, where's the sweet spot where I get the most amount of units sold at the

605
00:22:49.280 --> 00:22:50.920
highest gross profit?

606
00:22:50.920 --> 00:22:55.160
Oftentimes it's higher than you think it is because we're, I think a lot of entrepreneurs

607
00:22:55.160 --> 00:23:00.520
get stuck is like sales velocity goes down and then they get afraid, but the things is

608
00:23:00.520 --> 00:23:05.200
that you will usually make more money before you make less money when sales velocity drops

609
00:23:05.200 --> 00:23:06.200
usually.

610
00:23:06.200 --> 00:23:11.000
So it's like we sell 10 people at, you know, the $100 gross profit.

611
00:23:11.000 --> 00:23:14.400
And then when we, you know, move the price up, it's like we sell 80 people, but we're

612
00:23:14.400 --> 00:23:15.400
at 150.

613
00:23:15.400 --> 00:23:17.760
But you're like, all the sales teams like, I don't know how to do the price.

614
00:23:17.760 --> 00:23:20.720
The price seems really high or how the conversion of the page drop is like, yeah, we're making

615
00:23:20.720 --> 00:23:21.720
50% more money.

616
00:23:21.720 --> 00:23:23.040
We lost 20% of sales.

617
00:23:23.040 --> 00:23:26.680
If it were me, I would 80, 20 this.

618
00:23:26.680 --> 00:23:31.000
And this is what I'm solving for for pricing on the most sold products.

619
00:23:31.000 --> 00:23:33.800
You can have a much faster feedback loop for the testing.

620
00:23:33.800 --> 00:23:38.680
And so in terms of cadence for price tests, would you do it on the site more, do you think

621
00:23:38.680 --> 00:23:40.760
you would be doing it on the phone?

622
00:23:40.760 --> 00:23:41.760
It'd be able to site.

623
00:23:41.760 --> 00:23:42.760
Okay.

624
00:23:42.760 --> 00:23:43.760
Yeah.

625
00:23:43.760 --> 00:23:46.040
Because that's where customers see the pricing, even if they call or anything like that.

626
00:23:46.040 --> 00:23:47.040
Yeah.

627
00:23:47.040 --> 00:23:50.120
I don't know how many people like buy, is it a super price sensitive market?

628
00:23:50.120 --> 00:23:51.120
Trophies.

629
00:23:51.120 --> 00:23:52.120
Yeah.

630
00:23:53.120 --> 00:23:56.560
I'll bet you, what's interesting about this is that you're recurring revenue business

631
00:23:56.560 --> 00:23:58.040
is very price sensitive.

632
00:23:58.040 --> 00:24:01.640
It makes me lean more towards the gag gift side anyways, because it's like, we can get

633
00:24:01.640 --> 00:24:05.560
customers for free and we have far more pricing power because they're in the moment.

634
00:24:05.560 --> 00:24:10.280
They think it's funny, whether it's $8 or it's $12 or $16, like, I kind of just want

635
00:24:10.280 --> 00:24:11.280
to buy it.

636
00:24:11.280 --> 00:24:12.280
Yeah.

637
00:24:12.280 --> 00:24:15.360
But that's, you know, the difference between 18 and 16 is monstrous, right?

638
00:24:15.360 --> 00:24:16.360
Yeah.

639
00:24:16.360 --> 00:24:17.360
For the business.

640
00:24:17.680 --> 00:24:22.920
So site protest, and I would probably start with the gag gifts here.

641
00:24:22.920 --> 00:24:29.280
And then I'll make three, you can try one six percent on a boring side.

642
00:24:29.280 --> 00:24:34.240
Now this is the major part is if your focus is going to be media, that's going to be

643
00:24:34.240 --> 00:24:36.080
the direction that you're going in.

644
00:24:36.080 --> 00:24:40.160
Was there an influencer or something who made the video that had the trophy in it?

645
00:24:40.160 --> 00:24:45.720
They got tagged, our product on TikTok shop got tagged and we sold 70 to 100 off of

646
00:24:45.720 --> 00:24:46.720
that.

647
00:24:46.720 --> 00:24:49.640
And that's the one that had 16 million views.

648
00:24:49.640 --> 00:24:50.640
Okay.

649
00:24:50.640 --> 00:24:53.080
How many TikToks are you making a month?

650
00:24:53.080 --> 00:24:58.440
Right now we're doing about one a day and we're trying to ramp that up to three a day.

651
00:24:58.440 --> 00:24:59.440
Okay.

652
00:24:59.440 --> 00:25:03.040
Yeah, because the thing is, is like, your Amazon and Etsy, I would imagine, are fairly

653
00:25:03.040 --> 00:25:04.040
passive.

654
00:25:04.040 --> 00:25:05.040
Normally I would consolidate it.

655
00:25:05.040 --> 00:25:08.480
If you were like, I'm running all these things, I would say, like, let's, let's focus.

656
00:25:08.480 --> 00:25:12.560
But if that's like kind of on autopilot and I am familiar with like Amazon handles a lot.

657
00:25:12.560 --> 00:25:16.320
So the direct site traffic right now comes predominantly from SEO.

658
00:25:16.320 --> 00:25:17.320
Let's talk to me about that.

659
00:25:17.320 --> 00:25:21.600
Do you have an SEO firm or you're going to say, no, it's an SEO firm agency.

660
00:25:21.600 --> 00:25:23.200
How long have you been working with them?

661
00:25:23.200 --> 00:25:28.720
This one about eight months, traditionally I've only, I've always had pretty good success

662
00:25:28.720 --> 00:25:29.720
with SEO.

663
00:25:29.720 --> 00:25:30.720
Okay.

664
00:25:30.720 --> 00:25:34.160
And then we stopped SEO because the company wasn't, pretty scum, he wasn't performing.

665
00:25:34.160 --> 00:25:38.120
And we just let it go for several months and then hired another company.

666
00:25:38.120 --> 00:25:42.760
And then when these guys came in and started going back up again, what stops you from like

667
00:25:42.760 --> 00:25:46.240
doing more SEO or rather what stops that like, if you were to say,

668
00:25:46.240 --> 00:25:50.560
hey, because I mean, when I see 13 to one, right, I'm like, that sounds interesting.

669
00:25:50.560 --> 00:25:56.080
If you were to say, hey, I want you to give me like three clients worth of focus so

670
00:25:56.080 --> 00:25:59.720
that you can give me three times the backlinks and three times the articles or whatever it is

671
00:25:59.720 --> 00:26:01.960
that they're turning out for you.

672
00:26:01.960 --> 00:26:05.600
Is there anything that's because if you get 13 to one, it's like we should spend as

673
00:26:05.600 --> 00:26:06.600
much as possible.

674
00:26:06.600 --> 00:26:07.600
We can on that.

675
00:26:07.600 --> 00:26:12.320
And that's why I started meta is, but it's different though because it's an interruption

676
00:26:12.320 --> 00:26:14.760
based ads versus SEO where it's in time-based.

677
00:26:14.760 --> 00:26:17.320
Because it's also like, these things are things they're not taking your time.

678
00:26:17.320 --> 00:26:23.680
So this is like media one is SEO max out.

679
00:26:23.680 --> 00:26:27.920
And the SEO company wants me to do Google ads is throwing into that mix.

680
00:26:27.920 --> 00:26:28.920
Okay.

681
00:26:28.920 --> 00:26:31.720
Yeah, especially like these are both a intent based, right?

682
00:26:31.720 --> 00:26:32.720
Yeah.

683
00:26:32.720 --> 00:26:36.440
Like at the very least, you should own your own terms, which is like all your names and

684
00:26:36.440 --> 00:26:37.960
derivatives of your names.

685
00:26:37.960 --> 00:26:43.280
Like, I've rarely seen anyone in any business just own their own terms and not make money

686
00:26:43.280 --> 00:26:44.280
off of it.

687
00:26:44.280 --> 00:26:45.640
And so people are like, why do I want to pay for a click?

688
00:26:45.640 --> 00:26:48.200
I was going to get the things is like, you're not always going to get the click and so

689
00:26:48.200 --> 00:26:49.200
having it there.

690
00:26:49.200 --> 00:26:51.880
I'm like, you're going to make the money, like just, you know what I mean?

691
00:26:51.880 --> 00:26:55.800
But then the second version of that is, you know, associated terms.

692
00:26:55.800 --> 00:26:59.080
That's where the, like the long tail key words.

693
00:26:59.080 --> 00:27:03.720
And because yours, because the boring stuff, so this is all, this is all like the boring

694
00:27:03.720 --> 00:27:08.840
side of the business because trophies are so like, oh, I have to get trophies for the

695
00:27:08.840 --> 00:27:09.840
team this year.

696
00:27:09.840 --> 00:27:13.080
It's like, they're in this window and they're just going to buy whatever is like pretty

697
00:27:13.080 --> 00:27:14.080
much immediate.

698
00:27:14.400 --> 00:27:16.840
So I think this all makes sense.

699
00:27:16.840 --> 00:27:21.840
I don't know if people, I mean, you're running the meta ads to get the boring trophies.

700
00:27:21.840 --> 00:27:25.840
I would bet that that's probably, and you could do it.

701
00:27:25.840 --> 00:27:30.760
But this feels like, like it's less interruption based, more high intent based.

702
00:27:30.760 --> 00:27:35.080
Now, gag gives 100% known's like, hey, you know, fuck your move out of the plan, you

703
00:27:35.080 --> 00:27:36.080
know, trophy, right?

704
00:27:36.080 --> 00:27:37.080
I heard him.

705
00:27:37.080 --> 00:27:41.600
So this is the, like, if we're looking at this, these are all what I would consider like

706
00:27:41.600 --> 00:27:46.520
black and white, very low lift, almost guaranteed to make you more money.

707
00:27:46.520 --> 00:27:47.520
It moves.

708
00:27:47.520 --> 00:27:49.040
Almost all of these will just make you more money.

709
00:27:49.040 --> 00:27:50.040
This is 13 to one.

710
00:27:50.040 --> 00:27:51.680
This is probably going to be high return.

711
00:27:51.680 --> 00:27:53.240
This could double the profit.

712
00:27:53.240 --> 00:27:55.280
This takes at $50,000 to the bottom line.

713
00:27:55.280 --> 00:27:59.960
The process for sure going to increase on the gag gifts.

714
00:27:59.960 --> 00:28:02.320
So now we can talk about the, the media side.

715
00:28:02.320 --> 00:28:05.880
So you're going to go from one to three a day.

716
00:28:05.880 --> 00:28:07.520
I think that's a good idea.

717
00:28:07.520 --> 00:28:13.680
What I would suggest you do is look for, so there's going to be you.

718
00:28:13.680 --> 00:28:14.680
So there's going to be you.

719
00:28:14.680 --> 00:28:17.120
So we're going to go from one to three a day.

720
00:28:17.120 --> 00:28:22.040
And I think that you should focus on trends and memes.

721
00:28:22.040 --> 00:28:23.640
So like, because this is a gag gift brand.

722
00:28:23.640 --> 00:28:27.400
So it's okay for you to just like be silly and ridiculous.

723
00:28:27.400 --> 00:28:29.600
And so like just hire a 17 year old.

724
00:28:29.600 --> 00:28:31.200
I think that turns the girl.

725
00:28:31.200 --> 00:28:32.200
Yeah.

726
00:28:32.200 --> 00:28:33.840
I just feel like what's like what's trending right now?

727
00:28:33.840 --> 00:28:34.840
You know what I mean?

728
00:28:34.840 --> 00:28:38.320
So what's interesting is that a lot of these TikTok ones also do well on Instagram.

729
00:28:38.320 --> 00:28:39.440
So you could repurpose there.

730
00:28:39.440 --> 00:28:40.520
Do you post on Instagram?

731
00:28:40.520 --> 00:28:41.520
Yeah.

732
00:28:41.520 --> 00:28:42.520
Yeah.

733
00:28:42.520 --> 00:28:43.520
So it started.

734
00:28:43.520 --> 00:28:44.520
Yeah.

735
00:28:44.520 --> 00:28:45.520
You'll get double, you know, you'll get double usage on that.

736
00:28:45.520 --> 00:28:48.640
But yeah, TikTok is like the perfect platform for you for these gag gifts.

737
00:28:48.640 --> 00:28:49.840
Like it makes complete sense to me.

738
00:28:49.840 --> 00:28:51.840
They did $250,000 in a month.

739
00:28:51.840 --> 00:28:54.680
And so when I, the reason I said the 10 million is like, okay, well, that happened on

740
00:28:54.680 --> 00:28:55.680
accident.

741
00:28:55.680 --> 00:28:56.680
Let's do it on purpose.

742
00:28:56.680 --> 00:28:59.760
And if you can do 250 a month just from that, it's like, well, there's 3 million.

743
00:28:59.760 --> 00:29:03.200
I think you getting really ridiculous with the volume will get you a lot better.

744
00:29:03.200 --> 00:29:06.720
And I think this is one of those things that you should live close to, like you, like

745
00:29:06.720 --> 00:29:08.920
these things are all things that you could do.

746
00:29:08.920 --> 00:29:11.440
Probably the week you get back, you know what I mean?

747
00:29:11.440 --> 00:29:12.440
This one is going to be though.

748
00:29:12.440 --> 00:29:15.760
This is like the big commitment of what's the bet we're making?

749
00:29:15.760 --> 00:29:20.880
The bet we're making is that mastering TikTok, live selling, et cetera, is going to be

750
00:29:20.880 --> 00:29:21.880
the way.

751
00:29:21.880 --> 00:29:26.400
Now the second part of kind of like TikTok mastery is going to be influencers.

752
00:29:26.400 --> 00:29:30.800
What's nice with TikTok shot is that your stuff is automatically going to be listed there

753
00:29:30.800 --> 00:29:33.760
and other people can make videos for it.

754
00:29:33.760 --> 00:29:38.960
And you're in the price point that's perfect for TikTok shot, like 20, 30, 50, like it

755
00:29:38.960 --> 00:29:40.560
crushes for that stuff.

756
00:29:40.560 --> 00:29:43.680
And it's such easy videos for people to make.

757
00:29:43.680 --> 00:29:48.760
And I mean, fundamentally, like these are basically one time work.

758
00:29:48.760 --> 00:29:51.200
This is the only ongoing work that you do.

759
00:29:51.200 --> 00:29:56.200
And so trends and memes, and I'd be posting one to three times a day there, repurposing

760
00:29:56.200 --> 00:30:00.280
on IG, right, that's just free traffic.

761
00:30:00.280 --> 00:30:04.880
And then the influencers will also kind of, this will, it'll be like a loop here.

762
00:30:04.880 --> 00:30:09.800
So it's like, they'll give you, like they'll, they'll do something that works well.

763
00:30:09.800 --> 00:30:13.320
And then that will feed, like it'll just be this nice loop where they're also creating

764
00:30:13.320 --> 00:30:14.640
content for you.

765
00:30:14.640 --> 00:30:17.520
And then I'll put, I'm going to put number seven on here because I think this is worth

766
00:30:17.520 --> 00:30:18.520
it.

767
00:30:18.520 --> 00:30:23.320
The TikTok ads, which you said you just started, you make the ad, right, or sorry, you

768
00:30:23.320 --> 00:30:27.600
make the content, you already know what I'm going to do, you're making content, that's

769
00:30:27.600 --> 00:30:31.960
TikTok content, 10% go viral, whatever.

770
00:30:31.960 --> 00:30:41.160
And then 90% flop, right, then this, you put ad money behind it.

771
00:30:41.160 --> 00:30:47.200
And you send this to influencers and say, make stuff like this because this is what's

772
00:30:47.200 --> 00:30:48.200
converting.

773
00:30:48.200 --> 00:30:52.840
And then they'll make versions of this that'll also inform your content, which you'll

774
00:30:52.840 --> 00:30:55.520
then try to make iterations of what they're doing.

775
00:30:55.520 --> 00:30:59.520
And so like you're kind of your source, like you're starting, here's the TikTok content.

776
00:30:59.520 --> 00:31:00.520
Some does well.

777
00:31:00.520 --> 00:31:01.520
Great push ads behind it.

778
00:31:01.520 --> 00:31:04.720
By the way, guys, here's the ones that are working well, they make stuff you can take

779
00:31:04.720 --> 00:31:10.080
theirs, push money behind it as well, and model it and make for permutations of it.

780
00:31:10.080 --> 00:31:18.760
And so for this stuff, I would be kind of hook centric, meaning, like for, well, for

781
00:31:18.760 --> 00:31:21.720
most short form platforms, like the hook is everything.

782
00:31:21.720 --> 00:31:25.920
And once you have a winning hook, I would like reuse it over and over again.

783
00:31:25.920 --> 00:31:30.200
And so like if you have, you know, whatever your winning hook is, and then you could just

784
00:31:30.200 --> 00:31:37.480
basically sell down the line of skews, once you know, you actually have a really simple

785
00:31:37.480 --> 00:31:38.480
one.

786
00:31:38.480 --> 00:31:41.520
The nice thing is that I have a lot of confidence in your, like there's, there's basically

787
00:31:41.520 --> 00:31:48.600
no, like, not really sure, like site price test could easily like two acts profit on

788
00:31:48.600 --> 00:31:51.360
its own, because the margins are so similar right now, right?

789
00:31:51.360 --> 00:31:54.480
Six acts, this is the two acts on profit, for sure.

790
00:31:54.480 --> 00:31:59.760
SEO max out, right now it's 50% of revenue is coming from that.

791
00:31:59.760 --> 00:32:04.840
So it's like maybe we get a 50% boost from them doing a better job on it.

792
00:32:04.840 --> 00:32:07.440
PPC, we'll just get you good returns.

793
00:32:07.440 --> 00:32:09.440
This might give you like a 10 to 20% boost.

794
00:32:09.440 --> 00:32:12.640
So I don't think it'll be huge, but it's like, it's free and it's a one time setup.

795
00:32:12.640 --> 00:32:15.040
So it's not hard to do.

796
00:32:15.040 --> 00:32:19.000
TikTok's going to be the big lever of like, how do we go from one million to 10 million?

797
00:32:19.000 --> 00:32:22.960
It's like, if you, if you did nothing else, but just say like a year from now, if all

798
00:32:22.960 --> 00:32:29.280
we did was master TikTok and TikTok shopping, we would win.

799
00:32:29.280 --> 00:32:32.120
Like if you did nothing, this is just going to take all of your existing business and

800
00:32:32.120 --> 00:32:37.240
make it more profitable so that you can take all of this cash and float into here.

801
00:32:37.240 --> 00:32:41.800
And the fact that you have such low margins excites me.

802
00:32:41.800 --> 00:32:45.760
Because when you make five or 10% improvements, you double or triple.

803
00:32:45.760 --> 00:32:50.040
And the fact that you haven't liked that there was no pricing discipline, like there's

804
00:32:50.040 --> 00:32:52.080
no, there's no like process to pricing.

805
00:32:52.080 --> 00:32:55.320
Besides like, we'll just keep raising it when our costs go up.

806
00:32:55.320 --> 00:32:59.240
Usually there's just like, when I see a business like that, there's like massive unlocks.

807
00:32:59.240 --> 00:33:03.360
Like I'm saying 6% on point trophies, but like you might be able to push 25.

808
00:33:03.360 --> 00:33:05.880
And that 4x is 5x is profit, right?

809
00:33:05.880 --> 00:33:08.080
And gets very interesting.

810
00:33:08.080 --> 00:33:10.360
And the gag gives have much higher margins.

811
00:33:11.360 --> 00:33:14.160
And let me add something else.

812
00:33:14.160 --> 00:33:15.960
What's the offer that you have in the box?

813
00:33:15.960 --> 00:33:19.600
Usually it's a little code that says like 10% something to order here.

814
00:33:19.600 --> 00:33:21.840
Why don't you give something much better than that?

815
00:33:21.840 --> 00:33:26.200
So you have to come up with a really compelling offer to get people who are bikes.

816
00:33:26.200 --> 00:33:31.400
The nice thing, the important thing is, so is, are you doing fulfillment for Amazon sales?

817
00:33:31.400 --> 00:33:33.800
We have some FBA, but most of it's FVM.

818
00:33:33.800 --> 00:33:34.800
Okay, great.

819
00:33:34.800 --> 00:33:35.800
So you're fulfilling most of it.

820
00:33:35.800 --> 00:33:36.800
That's wonderful.

821
00:33:36.800 --> 00:33:37.800
Okay.

822
00:33:37.800 --> 00:33:38.800
So and Etsy same thing.

823
00:33:38.800 --> 00:33:39.800
Etsy we fulfill everything.

824
00:33:39.800 --> 00:33:40.800
Great.

825
00:33:40.800 --> 00:33:41.800
Okay.

826
00:33:41.800 --> 00:33:45.400
So that means that we can put something in the box to be really compelling to get them to

827
00:33:45.400 --> 00:33:46.400
to buy something.

828
00:33:46.400 --> 00:33:50.640
So if now Amazon Etsy, the purchasers who are buying there, are they more bread and butter

829
00:33:50.640 --> 00:33:52.640
people or are they more gag people?

830
00:33:52.640 --> 00:33:53.640
I would say more gag.

831
00:33:53.640 --> 00:33:54.640
More gag.

832
00:33:54.640 --> 00:33:55.640
Okay.

833
00:33:55.640 --> 00:33:58.720
Because they're more like funny death signs, funny sayings and stuff like that.

834
00:33:58.720 --> 00:34:09.600
I would put a bugo offering or a Saturday by one, get one to two free and then just fix

835
00:34:09.600 --> 00:34:12.480
the pricing of the one so that it makes sense.

836
00:34:12.480 --> 00:34:16.160
But then the, I would basically have this little thing here.

837
00:34:16.160 --> 00:34:21.640
So that would be the headline on the top of my little, my little, my little, do that.

838
00:34:21.640 --> 00:34:29.560
You got your QR code and then I would have my top one, two and three gag gifts, because

839
00:34:29.560 --> 00:34:30.560
they just bought one.

840
00:34:30.560 --> 00:34:34.560
So it's like, let me tell you the other gag gifts that people buy the most of.

841
00:34:34.560 --> 00:34:39.560
And I would put that into every one of the boxes, okay, for them.

842
00:34:39.560 --> 00:34:42.720
And would you have that QR code go back to that channel?

843
00:34:42.720 --> 00:34:46.720
So like Amazon or would it go back to our website question?

844
00:34:46.720 --> 00:34:47.720
It's a good question.

845
00:34:47.720 --> 00:34:50.320
Well, to make that offer, you'd probably have to bring it back to the site.

846
00:34:50.320 --> 00:34:51.320
Yeah.

847
00:34:51.320 --> 00:34:55.200
Well, the kind of not as worried about we just got to fix the pricing, but like, either way,

848
00:34:55.200 --> 00:34:58.800
I mean, it would be an interesting test, but I think this is the better.

849
00:34:58.800 --> 00:35:00.400
Like because you can make a form of compelling offer.

850
00:35:00.400 --> 00:35:01.400
Yeah.

851
00:35:01.400 --> 00:35:05.040
The other thing is, what do you, how big is your email list?

852
00:35:05.040 --> 00:35:08.840
For trophy side, I think we have like 10,000 contacts.

853
00:35:08.840 --> 00:35:09.840
Okay.

854
00:35:09.840 --> 00:35:10.840
Well, guess what?

855
00:35:10.840 --> 00:35:12.920
We just found ourselves another couple hundred grand.

856
00:35:12.920 --> 00:35:16.640
So let me tell you a stat that'll blow your mind.

857
00:35:16.640 --> 00:35:23.920
Most mature e-commerce businesses get between 30 and 50% of revenue from email or missing

858
00:35:23.920 --> 00:35:24.920
out a lot.

859
00:35:24.920 --> 00:35:25.920
Yeah.

860
00:35:25.920 --> 00:35:28.320
So there's probably like one and a half million sitting there.

861
00:35:28.320 --> 00:35:29.320
Yeah.

862
00:35:29.320 --> 00:35:34.280
And that's all profit because there's no ads, but most e-commerce businesses basically

863
00:35:34.280 --> 00:35:37.600
break even or lose money on spending ads to get customers.

864
00:35:37.600 --> 00:35:43.960
Then they make it up with their email follow up nine is going to be email follow up.

865
00:35:43.960 --> 00:35:44.960
Okay.

866
00:35:44.960 --> 00:35:45.960
So what do you use?

867
00:35:45.960 --> 00:35:46.960
You've been commerce.

868
00:35:46.960 --> 00:35:47.960
So they probably have.

869
00:35:47.960 --> 00:35:50.440
So you're, there's going to be two different types of email you need.

870
00:35:50.440 --> 00:35:52.640
So number one is going to be flows.

871
00:35:52.640 --> 00:35:54.520
So these are based on user behavior.

872
00:35:54.520 --> 00:36:00.680
So when someone visits a specific product, they should get like a five email sequence of

873
00:36:00.680 --> 00:36:04.400
being like, Hey, saw that you were looking at the goat, whatever, right?

874
00:36:04.400 --> 00:36:07.800
And that should just, that should happen for anybody who opts in or does a two step or

875
00:36:07.800 --> 00:36:08.800
bending carts.

876
00:36:08.800 --> 00:36:09.800
Okay.

877
00:36:09.800 --> 00:36:11.760
The, the other piece is we need the long term merch.

878
00:36:11.760 --> 00:36:12.760
All right.

879
00:36:12.760 --> 00:36:15.920
So what I'd recommend is three times per week.

880
00:36:15.920 --> 00:36:21.080
The question is, it feels like a lot for trophies because trophy is a less frequent purchase.

881
00:36:21.080 --> 00:36:25.440
The gag I feel like is a, is like, if you buy one gag gift, you'd be willing to like buy

882
00:36:25.440 --> 00:36:28.240
them for many people because it's just think they're funny.

883
00:36:28.240 --> 00:36:30.680
They are separate brands though because you have like, okay.

884
00:36:30.680 --> 00:36:35.120
So I would say this I'm cool with on the gag gift side because right now you're not

885
00:36:35.120 --> 00:36:36.920
making any return sales anyways, right?

886
00:36:36.920 --> 00:36:37.920
It's amazing.

887
00:36:37.920 --> 00:36:40.920
Well, it gets, we don't really have an email list for the gag side because it's all.

888
00:36:40.920 --> 00:36:41.920
Wow.

889
00:36:41.920 --> 00:36:42.920
It's easy.

890
00:36:42.920 --> 00:36:45.000
Does TikTok not give you an email?

891
00:36:45.000 --> 00:36:46.000
Okay.

892
00:36:46.000 --> 00:36:50.640
So I think we'll go one time a week and we'll not worry about the gag gift.

893
00:36:50.640 --> 00:36:51.640
Okay.

894
00:36:51.640 --> 00:36:56.200
I think just one time a week of, and if, if you were basically domain, your domain, healthy,

895
00:36:56.200 --> 00:36:58.480
your domain, authority stays healthy in your open right state.

896
00:36:58.480 --> 00:36:59.480
Okay.

897
00:36:59.480 --> 00:37:00.480
Okay.

898
00:37:00.480 --> 00:37:01.480
I would increase frequency.

899
00:37:01.480 --> 00:37:02.480
Okay.

900
00:37:02.480 --> 00:37:04.480
So you'll start with one a week and you're probably thinking, okay, what am I going to,

901
00:37:04.480 --> 00:37:06.400
what am I going to email them about, right?

902
00:37:06.400 --> 00:37:10.920
So when you have customer stories, cool trophies, because I'm sure there's every week there's

903
00:37:10.920 --> 00:37:15.200
like one trophy or something that's just like interesting that you guys have, right?

904
00:37:15.200 --> 00:37:20.440
Probably stuff about recognition, status, and cheapest compensation.

905
00:37:20.440 --> 00:37:23.400
So I think if I were to, if I owned your company, right?

906
00:37:23.400 --> 00:37:27.160
So I'd be like, okay, are we in the trophy business?

907
00:37:27.160 --> 00:37:28.160
No.

908
00:37:28.160 --> 00:37:29.160
It's a sell, right?

909
00:37:29.160 --> 00:37:34.200
But it's really just the vehicle for giving people recognition, status, and compensation.

910
00:37:34.200 --> 00:37:35.200
Right?

911
00:37:35.200 --> 00:37:40.400
And so my, the things that I would email would probably be about how you could either give

912
00:37:40.400 --> 00:37:44.640
your team a pay raise or you could give them a trophy and believe it or not, here's

913
00:37:44.640 --> 00:37:47.400
this research, the trophy is actually even more meaningful.

914
00:37:47.400 --> 00:37:50.760
So they like it more and you like it more as a business owner, right?

915
00:37:50.760 --> 00:37:53.640
So it'd be that kind of stuff that I'd be, you only have to write 52.

916
00:37:53.640 --> 00:37:54.640
It's not that many.

917
00:37:54.640 --> 00:37:55.640
Yes.

918
00:37:55.640 --> 00:37:56.640
Right?

919
00:37:56.640 --> 00:37:57.640
Yeah.

920
00:37:57.640 --> 00:37:58.640
Yeah.

921
00:37:58.640 --> 00:38:03.120
And I would be hitting this and then I would just weave in examples and the examples will

922
00:38:03.120 --> 00:38:07.120
do enough modeling for people to basically click and then go back to the site because all

923
00:38:07.120 --> 00:38:09.120
we're trying to do is just bring them back to the site.

924
00:38:09.120 --> 00:38:14.800
Now on every one of these, these emails, I would have a PS, a funniest trophy of the week.

925
00:38:14.800 --> 00:38:18.680
So think about like a newspapers, like they have all the articles that are serious, but

926
00:38:18.680 --> 00:38:23.120
then people just buy them to read the funnies, they read the cards and so we do the same

927
00:38:23.120 --> 00:38:26.440
thing here because you probably have some hilarious trophies that get made, right?

928
00:38:26.440 --> 00:38:27.440
Yeah.

929
00:38:27.440 --> 00:38:28.440
And then just be like explicit.

930
00:38:28.440 --> 00:38:29.440
You know what I mean?

931
00:38:29.440 --> 00:38:30.720
I think that people would find it hilarious.

932
00:38:30.720 --> 00:38:31.720
Okay.

933
00:38:31.720 --> 00:38:34.360
And if you're worried about supposed to know about those ones, but like I still think that

934
00:38:34.360 --> 00:38:40.440
you have funniest trophy the week and even it and like this is me taking the complete

935
00:38:40.440 --> 00:38:43.720
extreme stance, people, people may care about this.

936
00:38:43.720 --> 00:38:46.720
People might just think this is funny and if you just did this, it's like you're almost

937
00:38:46.720 --> 00:38:47.720
just sending them jokes.

938
00:38:47.720 --> 00:38:49.960
I mean, it's the same as making content on the internet.

939
00:38:49.960 --> 00:38:52.280
And so they're like, Oh God, what is the, like what did they, what did they make this

940
00:38:52.280 --> 00:38:53.280
week?

941
00:38:53.280 --> 00:38:54.280
Right.

942
00:38:54.280 --> 00:38:55.280
Right.

943
00:38:55.280 --> 00:38:56.280
Right.

944
00:38:56.640 --> 00:38:59.720
And I think about this also seasonal.

945
00:38:59.720 --> 00:39:03.280
So what are all the things that are coming up that like that are coming up next season

946
00:39:03.280 --> 00:39:04.800
because you know what the buying cycle is for trophies.

947
00:39:04.800 --> 00:39:08.120
So it's like what are like, okay, Christmas is coming up because there's going to be

948
00:39:08.120 --> 00:39:09.800
end of year bonuses for people.

949
00:39:09.800 --> 00:39:13.560
There's going to be, okay, fantasy, what what fantasy league ends in October.

950
00:39:13.560 --> 00:39:16.320
So probably like hockey ends or whatever, right?

951
00:39:16.320 --> 00:39:17.520
Like best costume costumes.

952
00:39:17.520 --> 00:39:18.520
Exactly.

953
00:39:18.520 --> 00:39:23.600
So it's like we have to remind them of what people get status and recognition for using trophies.

954
00:39:23.600 --> 00:39:24.600
Gotcha.

955
00:39:24.600 --> 00:39:26.160
That's the job of the long term nurture.

956
00:39:26.160 --> 00:39:29.720
The things are people are going to be rewarding next month that we get to have to be people

957
00:39:29.720 --> 00:39:31.000
buy this month.

958
00:39:31.000 --> 00:39:34.680
And we just every month, like you look at your calendar, you're like, I have to think

959
00:39:34.680 --> 00:39:38.160
of four emails that apply for next month, right?

960
00:39:38.160 --> 00:39:41.960
And I would probably, I put this as like, okay, I've got my business one.

961
00:39:41.960 --> 00:39:46.680
I've got my, you know, season one, I've got my sports one.

962
00:39:46.680 --> 00:39:48.680
So these are like my buckets for my emails.

963
00:39:48.680 --> 00:39:52.400
So every email, it's like, it's almost like you're hitting from a different angle and

964
00:39:52.400 --> 00:39:54.800
reminding people of different components of their life.

965
00:39:54.800 --> 00:39:59.160
And so that's probably how I'd have my long term strategy and provided all of the metrics

966
00:39:59.160 --> 00:40:00.160
look good.

967
00:40:00.160 --> 00:40:02.160
I would just increase frequency.

968
00:40:02.160 --> 00:40:03.160
Yeah.

969
00:40:03.160 --> 00:40:04.160
Okay.

970
00:40:04.160 --> 00:40:07.240
So keep it low in the beginning, just to like get a feel for it.

971
00:40:07.240 --> 00:40:09.840
See how like the first couple of emails are going to shake out because you're going to have

972
00:40:09.840 --> 00:40:11.560
a super responsive list.

973
00:40:11.560 --> 00:40:13.920
And we want to keep these all text.

974
00:40:13.920 --> 00:40:17.000
You can have, I would say link to the image because then the curiosity is going to drive

975
00:40:17.000 --> 00:40:18.200
the click.

976
00:40:18.200 --> 00:40:24.160
And also image based to tend to get lower delivery rights than like full text one.

977
00:40:24.160 --> 00:40:30.280
So when people opt in or say when people purchase or opt in an event in car, the first one

978
00:40:30.280 --> 00:40:36.960
I would have is reply back for honest trophy all the time.

979
00:40:36.960 --> 00:40:39.080
And so as soon as someone opts in, it's a double opt in.

980
00:40:39.080 --> 00:40:41.160
So don't create your deliverability.

981
00:40:41.160 --> 00:40:44.480
And so they'll reply back and then it's an automation of to do anything.

982
00:40:44.480 --> 00:40:48.960
And then you'll send them the link for the clickable picture and the way this is ridiculous.

983
00:40:48.960 --> 00:40:51.920
And then underneath of that, so when you have the, when you have a clickable link, you

984
00:40:51.920 --> 00:40:55.360
want to have it take them to a page, it looks like this.

985
00:40:55.360 --> 00:41:01.480
And then here you have, so like you can have the funniest thing, but it's also a CTA to

986
00:41:01.480 --> 00:41:02.880
get someone to buy some of it.

987
00:41:02.880 --> 00:41:03.880
Gotcha.

988
00:41:03.880 --> 00:41:04.880
Just not in the email.

989
00:41:04.880 --> 00:41:05.880
Yeah.

990
00:41:05.880 --> 00:41:06.880
Yeah.

991
00:41:06.880 --> 00:41:07.880
They see it and if they want to buy it, it's right there.

992
00:41:07.880 --> 00:41:08.880
Right.

993
00:41:08.880 --> 00:41:09.880
Super cool.

994
00:41:09.880 --> 00:41:10.880
Well, I think we found a few doubles.

995
00:41:10.880 --> 00:41:11.880
Yeah.

996
00:41:11.880 --> 00:41:12.880
In the business.

997
00:41:12.880 --> 00:41:13.880
Absolutely.

998
00:41:13.880 --> 00:41:14.880
Feel all right.

999
00:41:14.880 --> 00:41:15.880
A little money.

1000
00:41:15.880 --> 00:41:16.880
Money map.

1001
00:41:16.880 --> 00:41:17.880
I think you will significantly more than double profits.

1002
00:41:17.880 --> 00:41:20.920
Well, that gives you 50 and that's the first thing we do.

1003
00:41:20.920 --> 00:41:24.440
This could easily double profits if we just add the six percent, right?

1004
00:41:24.440 --> 00:41:26.320
That's all we'd have to do.

1005
00:41:26.320 --> 00:41:28.800
If you increase SEO, you will make more money.

1006
00:41:28.800 --> 00:41:31.200
How much more we'll see, but more.

1007
00:41:31.200 --> 00:41:35.080
This is free money, but this is actually the biggest, I think this is actually the biggest

1008
00:41:35.080 --> 00:41:36.080
finding.

1009
00:41:36.080 --> 00:41:37.080
Is the emails.

1010
00:41:37.080 --> 00:41:38.080
Yeah.

1011
00:41:38.080 --> 00:41:39.080
Thirty to fifty percent are evident.

1012
00:41:39.080 --> 00:41:40.080
Like clockwork.

1013
00:41:40.080 --> 00:41:41.080
Yep.

1014
00:41:41.080 --> 00:41:42.080
Especially.

1015
00:41:42.080 --> 00:41:46.320
And so it's interesting is the less ad dependent your businesses, the higher the percentage

1016
00:41:46.320 --> 00:41:47.760
will come from you.

1017
00:41:47.760 --> 00:41:50.160
I feel like if you have a fast growing company that's spending more and more money every

1018
00:41:50.160 --> 00:41:53.400
month and the percentage by math would be smaller.

1019
00:41:53.400 --> 00:41:56.680
When you have a more stable older business that's coming from email, like it'll be greater

1020
00:41:56.680 --> 00:41:57.680
and greater.

1021
00:41:57.680 --> 00:41:59.680
Like I know a company right now that is eight by ninety percent.

1022
00:41:59.680 --> 00:42:00.680
They do a billion a year.

1023
00:42:00.680 --> 00:42:01.680
Ninety percent comes from email.

1024
00:42:01.680 --> 00:42:02.680
Wow.

1025
00:42:02.680 --> 00:42:03.680
Yeah.

1026
00:42:03.680 --> 00:42:04.680
Okay.

1027
00:42:04.680 --> 00:42:08.680
I would say also in that kill Facebook ads for trophy outlet, trophies.

1028
00:42:08.680 --> 00:42:12.720
It just, it wouldn't have been my, I mean, right now it wasn't profitable for no

1029
00:42:12.720 --> 00:42:13.720
mistaken.

1030
00:42:13.720 --> 00:42:17.120
I'd rather redirect resources to the things that will make it so fine.

1031
00:42:17.120 --> 00:42:21.040
I'd rather just do TikTok ads instead of my ads, given that's like you did two fifty

1032
00:42:21.040 --> 00:42:22.040
for free.

1033
00:42:22.040 --> 00:42:23.040
Right.

1034
00:42:23.040 --> 00:42:24.040
Right.

1035
00:42:24.040 --> 00:42:25.040
Absolutely.

1036
00:42:25.040 --> 00:42:26.040
Feel alright?

1037
00:42:26.040 --> 00:42:27.040
Yeah.

1038
00:42:27.040 --> 00:42:28.040
I feel really good.