The DTC Podcast

How do you run Black Friday when your DTC brand is already hooked on discounts? Split your customers into new and repeat, keep the coupon-trained cohorts on their deal, and use the Black Friday offer to bring in new customers who have never seen your 30% off.

On the second DTC Rundown, Eric Dyck is joined by Jordan Gordon, who leads email and retention at Pilothouse, and Rafael Gi, who works on partnerships and client strategy there. Each topic runs on a timer. They start with a brand that has run 30% off sitewide five times this year, move to why Meta keeps spending in the markets you have already saturated, and finish with the worst things Pilothouse finds when it audits a brand's email program.

Get an audit from Pilothouse: https://pilothouse.co

WHAT YOU WILL SOLVE
Your customers only buy when there is a coupon. Jordan separates the coupon-addicted cohorts, keeps showing them their price through email, and controls the offers new customers see so they settle on a new normal.
Your Black Friday offer is the same one you ran all year. Push it to 35%, or lead with an "up to" offer on a door buster that is not your most important product.
You treat your discount as a flat rate. Rafael budgets discounts like media spend, with a goal for each offer, such as a one-day drop on your best seller to capture new customer emails.
You give away margin in Q4 and get nothing back in January. Set an AOV threshold that earns a gift card customers can only redeem in Q5.
Your early access list waits weeks for the deal. Give them the Black Friday offer the day they sign up, then use the flow to sell them on buying from you all year.
Meta keeps spending where you are already strongest. In one Pilothouse audit of a nine-figure brand, two regions near where the company was founded held 8% of its addressable market, produced 40% of its revenue, and were being over-delivered by 20 to 30%.
Every region carries the same ROAS target. Set targets by market maturity instead: higher efficiency in saturated markets, break even or a small loss in new ones, and something in between for markets that are emerging.
Your email program is turned up to maximum. Jordan found one brand with 700 live flow messages sending up to four campaigns a day, and another using 30-day open attribution that credited email for sales driven by ads.
You do not know what email earns on its own. A control group that only receives the first welcome email shows you the incremental revenue.
Your SMS budget looks expensive. At one brand, email click-through sat at 0.09% while SMS reached 2.5%, and an SMS click cost 25 cents against roughly $1.30 for Meta and Google retargeting.
The algorithm narrowed your brand to one message. How a testosterone supplement ended up with a site built around libido, and why the fix meant rebuilding creative, site and email together.
Your pricing sits behind a quiz. At one subscription brand, only 3% of people who went through the quiz checked out.

ABOUT THE GUESTS
Jordan Gordon leads email and retention at Pilothouse and hosts The World's Best Email and Retention Podcast. https://podcasts.apple.com/us/podcast/the-worlds-best-email-and-retention-podcast/id1772940578

Rafael Gi works on partnerships and client strategy at Pilothouse, a performance marketing agency. https://pilothouse.co

STAY CONNECTED
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YouTube: https://youtube.com/@dtcnewsletter
LinkedIn: https://linkedin.com/company/directtoconsumer
Want to be on the Rundown? Email eric@directtoconsumer.co

00:26 Raf's hamstring and Jordan's white belts
04:49 Budget your discounts like media spend
07:15 Do bundles and gifts with purchase fix it
16:06 How a market matures
27:16 The supplement the algorithm turned into a libido brand
33:08 The subject line typo the investors saw
34:20 Budweiser Red Light and the Bud Light UFC promo
37:36 The $10,000 retreat ticket paid in Bitcoin

Carve Designs gave connected TV 60 days at a $20K monthly minimum before deciding it worked, which is about as clean a test as a DTC brand runs on a new channel. The lift showed up first in direct traffic and search, and conversion rates rose across channels for customers who had seen the ads.

Hannah Fleming runs performance marketing at Carve Designs, the coastal apparel brand that grew out of swim. She joins Eric Dyck and Jesse Math of Keen Decision Systems to walk through the bets that take months to pay back: direct mail, connected TV, TikTok and whitelisted ads, plus the Pinterest test that never worked. You walk away knowing how to size a first test, where to look for the halo, and how long to wait before you cut a channel.

Get the DTC Newsletter: https://directtoconsumer.co

WHAT YOU WILL SOLVE
Your direct mail gets credit for every buyer on the mailing list. Jesse's question is how many of them would have bought anyway. Carve answers it with holdout panels, including tests that also suppress email and paid social for the held-out group.
You can't tell whether to mail more. Carve tracks contribution per piece, tests catalog count, page count and size, and reweights audiences between 0 to 12 month and 13 to 24 month buyers.
Your average ROI says spend more. Jesse's example: a $2 return on $1 million tells you nothing about the next dollar, because the first dollars into a channel return more than the last ones.
Your other channels swing around the catalog drop. Carve plans spend in every other channel around catalog in-home dates.
You don't know what a first connected TV test costs. Carve ran 60 days at a $20K monthly minimum, with a fixed window, set objectives and targets, and landed on target or slightly ahead of it.
You can't find where connected TV sales land. At Carve they land mostly on the site as direct traffic, with a small portion on Amazon, and GA4 shows higher conversion rates for customers who saw a CTV ad and then clicked an email or a paid social ad.
Your CTV attribution looks too good. Jesse sees brands arrive with platform numbers their CFO doesn't believe. The question to ask is whether you are buying new customers or buying inventory your existing customers already watch.
You judge upper funnel on a 14 or 30 day window. For brands buying CTV for awareness, Jesse says Keen sees roughly 30% of the measured impact in the short term and roughly 70% over time.
You're about to kill a channel at month three. TikTok took Carve about six months to gain momentum, and whitelisted ads took close to 18 months before they became a top performer.
You treat every test as a pass or a fail. Jesse's alternative is to find the 30% that worked, pare back the rest, and keep going.

ABOUT THE GUESTS
Hannah Fleming is Performance Marketing Director at Carve Designs. Shop the collection or request a catalog at https://carvedesigns.com

Jesse Math is VP of Strategic Partnerships at Keen Decision Systems, the marketing mix modeling, planning and forecasting platform. https://keends.com

HARNESS THE HALO
Harness the Halo is a six-part series from DTC and Keen about the spend that doesn't pay you back the same day, and the measurement that gives you room to make it. This is episode 4 of 6, and a new episode drops every other week.

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LinkedIn: https://linkedin.com/company/directtoconsumer

SPONSOR
Harness the Halo is presented by Keen Decision Systems. Keen measures the incremental impact of every channel on sales, revenue and profit, and forecasts how a channel will perform before you spend in it. https://keends.com

How do you grow a DTC brand without a big brand awareness budget? Terra Kaffe founder Sahand Dilmaghani pre-sold 10,000 espresso machines from a single page with no reviews, and word of mouth has been the top reason customers buy every month for five years.

On the DTC Podcast, Sahand tells Eric Dyck how he left investment banking to bootstrap a super automatic espresso machine, what he cut to get it shipped with $2.5 million already spent, and why Terra Kaffe now puts its money into community and performance marketing instead of brand awareness. Terra Kaffe has 70,000 machines in homes today.

Get the DTC Newsletter: https://directtoconsumer.co

WHAT YOU WILL SOLVE
You sell a high-ticket product and cannot seed it to a thousand creators a month. Sahand built word of mouth by calling customers himself, and it now drives well over a third of Terra Kaffe's orders.
Your brand awareness budget is too small to register. Why $15K to $20K a month will never make you a household name, and when to hold that money for one campaign big enough to count.
Your best video flopped on Meta. A $30K shoot that never converted on Instagram or Facebook became one of Terra Kaffe's strongest performers on CTV.
Your investors want proof of demand before the product is finished. One pre-order page, a teaser campaign, an email to the subscriber list and a booth at a New York coffee festival produced 10,000 orders.
Your product is over budget and behind schedule. The features Terra Kaffe cut in a do-or-die meeting to ship in six months, and which ones came back later as a fast follow.
Your outside partner has spent double to go half the distance. How Sahand replaced his engineering firm mid-build while it still held most of the product knowledge.
You cannot afford tooling or a production deposit. The trade he made with his manufacturer on the first machine's design rights, and what it cost him later.

ABOUT SAHAND
Sahand Dilmaghani is the founder and CEO of Terra Kaffe, the Brooklyn-based maker of super automatic espresso machines, including the TK-02 and the Demi. Before Terra Kaffe he worked in investment banking and at an electric vehicle startup. https://www.terrakaffe.com
Instagram: https://www.instagram.com/terrakaffe

STAY CONNECTED
DTC Newsletter, daily ecommerce marketing and ecommerce growth tactics: https://directtoconsumer.co
YouTube: https://youtube.com/@dtcnewsletter
LinkedIn: https://linkedin.com/company/directtoconsumer

00:49 From Wall Street banker to "barista"
02:25 Carrying a 30 pound espresso machine on the subway
04:40 The only espresso brand anyone could name
05:22 The Larry David campaign idea
06:13 Building complex hardware during COVID
08:52 $2.5 million in, with no guarantee it ships
09:09 Funding one milestone at a time
10:42 The meeting where the features got cut
13:36 Replacing the engineering firm mid-build
16:33 Giving the manufacturer the V1 design rights
20:44 Answering the dropship accusations
21:32 The investor test: does anyone want this
23:22 10,000 pre-orders from one page
25:11 The Terra Kaffe manifesto
26:16 What a super automatic machine does
29:39 Why people bought before they could try it
32:33 70,000 machines in homes
33:25 Word of mouth, every month for five years
36:28 Brand spend versus performance marketing
38:23 The three problems every operator hits
40:39 Why a small brand awareness budget is a trap
41:15 Coming for Nespresso
42:37 CTV and the $30K shoot that flopped on Meta
46:34 Survival by a thousand band-aids
47:34 Raising $2.6 million in 13 days
48:03 You are going to get punched in the face

What are Meta partnership ads, and how should a DTC brand test them before Q4? They run through a creator's handle with your brand tagged, so Meta combines both accounts' engagement signals, and Pilothouse typically sees lower CPMs on them than on ads from the brand handle alone.

Jacob Geary runs Meta accounts at Pilothouse and joins Eric Dyck on All Killer No Filler to lay out how partnership ads work in practice. On the larger accounts his team runs, 30 to 50% of the ads now go out as partnership ads, and most of the creators behind them are micro-creators. You walk away with a test plan for a brand spending $50K to $100K a month on Meta: the budget, the number of creators, the formats to brief, and the metrics that decide what scales.

Get the DTC Newsletter: https://directtoconsumer.co

WHAT YOU WILL SOLVE
Your customers have seen your brand ads so often they scroll past them. The same message from a creator's handle, with your brand tagged, gives them a fresh face and tends to deliver at a lower CPM.
You don't know where to find creators. The Partnership Ads Hub inside Meta suggests creators in your vertical, surfaces people already posting about you, and hands you the ad code once both sides approve.
You don't know what to brief. Jacob's starting formats are "why I switched" problem and solution videos, holiday gift guides, and raw unboxings shot on a phone.
You don't know what to pay. Jacob's range is $100 to $300 per creator for a few videos and 60 days of usage, and some creators will take the exposure from your ad spend without a fee.
You assume you need big names. Micro-creators make up 80 to 90% of what Pilothouse runs, with performance Jacob describes as very similar and a faster testing cadence.
Your Q4 creator ads die the day the sale ends. Brief creators three to four weeks ahead and have them mention the sale in general terms instead of reading out a discount and a date.
You don't know how big the first test should be. At $100K a month on Meta, Jacob puts 10% toward three to five creators with one or two videos each, then builds toward 20% by month three.
You're not sure how to judge the results. Use the same purchase conversion rate and ROAS benchmarks as any new creative test, with a little more patience in month one.

ABOUT JACOB
Jacob Geary is a Meta media buyer at Pilothouse, the performance marketing team behind DTC, where he runs paid social for ecommerce brands. To talk partnership ads with his team, go to https://pilothouse.co and ask for Jacob.

STAY CONNECTED
DTC Newsletter, daily ecommerce marketing and ecommerce growth tactics: https://directtoconsumer.co
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LinkedIn: https://linkedin.com/company/directtoconsumer

00:49 Intro: Jacob from Pilothouse on Meta partnership ads
01:28 What partnership ads are, versus whitelisting and dark posts
02:53 The Partnership Ads Hub as a creator discovery network
03:53 Why they matter: combined signals and ad blindness
05:17 Are partnership ads incremental?
06:30 Why partnership ads get cheaper CPMs
07:34 Fresh looks, Andromeda and ad sequencing
08:59 Formats that work: why I switched, gift guides, unboxings
10:30 Gifting angles for each creator's audience
11:24 Usage rights and how creators get paid
12:10 Deal structures: affiliate, paid per video, or free
13:32 Planning creator volume for Q4
15:40 Briefing sale language that won't expire
16:12 What share of Meta ads run as partnership ads
17:37 Test budgets for brands just starting out
19:38 Micro-creators versus mega-influencers
21:17 Post-click: when a dedicated landing page earns the build
22:06 Creator communities and leaderboards
23:06 Setup steps, and why to get permissions before November
25:11 A test plan for a $5M brand spending $50K to $100K a month
27:58 The metrics that decide a winner
29:43 Close and how to reach Jacob

How do you raise prices on a DTC brand without killing demand?

Derek Jaeger founded Last Crumb in 2020, priced a box of cookies at $110, then moved it to $140. He says that is when the company took off. Eric Dyck gets the full DTC marketing story on the DTC Podcast: pricing as positioning, ecommerce growth without a repeat purchase, and why he killed the weekly drop model that made the brand famous.

Get the DTC Newsletter: directtoconsumer.co

Get your brand on TV today: https://www.universalads.com/dtcpromocode?utm_medium=email&utm_source=dtc-newsletter&utm_campaign=issue-takeover
WHAT THIS EPISODE SOLVES

Your premium product is not moving and you are about to discount it. Derek tested upward instead. At $110 Last Crumb was fine, at $140 it had a differentiator, and the drops started selling out in one second.

You cannot hold a high price on packaging alone. He built the box as shipper and gift box in one, tested the angle each cookie sits at, and landed on 35 degrees with 90% of the lettering visible on open.

Scarcity launched you and has become your ceiling. Why a drop model cannot stay a value pillar forever, and how moving to evergreen was the test of whether he had a real company or a hype company.

Your customer acquisition cost will not clear on a single order. No subscription, no natural repeat, and a product that mostly gets gifted. What carried ecommerce growth when paid could not.

You are paying creators for content that does not perform. Last Crumb briefs nobody. They watch for organic posts that already work, whitelist those, and run the same asset on Instagram and YouTube. One repurposed video pulled 300,000 views.

You lose control of the product the moment it ships. The last seventy two hours in a UPS truck, and why owned retail at $8.50 a cookie fixed what ecommerce marketing could not.

ABOUT THE GUEST

Derek Jaeger is the founder of Last Crumb, the luxury cookie brand he started in Los Angeles in 2020 and has since moved to New York, with production in Brooklyn and its first store in Williamsburg. He still writes every recipe himself. lastcrumb.com

STAY CONNECTED

Newsletter: directtoconsumer.co

RECORDING TIME | CHAPTER00:00 Two ex-affiliates sitting down01:18 The affiliate years, penny clicks and dollar CPMs02:44 Walking away from performance marketing03:33 A year of brand building before a single box shipped04:38 The brief: the opposite of every mom and pop bakery05:47 Pricing as position one06:53 The box, the pull tab, and the 35 degree cookie angle08:45 Liquid Death on the vision board10:01 The Monday noon drop model11:28 Why he banned paid ads at launch12:35 Fifty boxes in LA, and the move from $110 to $14014:01 Chrissy Teigen posts and it goes ballistic15:15 People posting receipts before the box arrives16:43 Sifting flour in the original kitchen17:26 Investors show up, and 1,500 orders left in carts19:16 Building the cap table20:22 Where the first money went21:18 Killing the drop model22:26 Why paid media does not scale on a gifting brand23:34 The company today, 16,000 square feet in Brooklyn24:20 Why he has never been CEO25:58 Managing the operator you hire27:20 Building a smaller pack for TikTok Shop28:53 The last 72 hours you cannot control30:38 A unique dough for every flavor31:59 What he kept from affiliate marketing33:09 Moving the company to New York35:17 Retail pricing and the Levain comparison36:52 Retail as top of funnel38:33 Whitelisting organic creator content39:59 Product as the reason any of it worked41:56 Where the brand goes next43:01 The Crumbl lesson45:40 Why GLP-1s might help a premium cookie brandhttps://directtoconsumer.typeform.com/DTC-Brand?utm_source=podcast-648&utm_medium=podcast