Episode 51: The Future of Direct Mail and Marketing | DTC Podcast Interview with Drew Sanocki

‍Listen and nerd out on: Apple Podcasts | Spotify

‍Announcer:

Hey, welcome to the Nerd Marketing Podcast. Join co-hosts and ecom OGs Drew Sanocki and Michael Epstein. Get ready as they'll bring you trusted tactics and strategies from boosting your brand's revenue, operations, and profitability.

Drew Sanocki:

Hey everybody. Drew Sanocki here at the Nerd Marketing Podcast. This week in lieu of our podcast, I talk with Eric from the DTC newsletter. It's a great overview podcast. We go deep on a lot of things. We talk about growth versus profitability. We talk about focusing on your best customers, and we talk about direct mail and how to use it. So without further ado, I hope you enjoy this episode of the Nerd Marketing Podcast.

Eric Dyck:

Drew, welcome to the DTC podcast. This is a long time coming. I was just saying in the preamble, I think it was probably 2018 when I met Ezra Firestone and one of the first people he met, she's like, you got to meet Drew. And I think we've been kind of going back and forth since then. And I know you're now with PostPilot, but I know you've, you've had such a long interesting career I feel like in this space. So I'm finally glad to have you on the podcast.

Drew Sanocki:

I'm excited to be here. I would say it's a long career. I don't know if it's an interesting one.

Eric Dyck:

It's pretty, well, let's start me at the beginning. The way Ezra prefaced you was just that you had a number of early e-commerce experiences with some of the world's biggest brands and really kind of cut your teeth with some big players.

Drew Sanocki:

I think it's just by, I've been under the hoop for so long. Eventually you're going to get a couple of baskets, right. So I started my e-commerce career in 2000. I started a brand retail brand. This was before Shopify, before Magento, I guess we were doing dropshipping, which was like what everybody did back then selling furniture, sold that. And then I into this, I sort of backed into this role of a DTC turnaround artist where I would buy companies, get them profitable and sell them. And I probably did that for another 10 years.

Eric Dyck:

Very interesting. Back then, what were the key things? Because I think now partnered with this agency, everything, we're a hammer, so everything looks like a nail. We think right away, okay, we're going to improve their marketing. But I'm curious from a DTC fixer or e-Commerce Fixer back then, what were the main things you were fixing?

Drew Sanocki:

The marketing? Yeah. Well, it was when I started my brand in 2000, there was no DTC podcast. There's no Ezra Firestone to go learn from. So I went to the library and got books out on catalog marketing in direct mail. That industry is probably a hundred years old. And they laid out a framework, which I guess it's not sexy to call it catalog marketing. It's more sexy to call it database marketing. But they laid out a framework on how to segment your customers and treat different customers differently. And that's really the framework that brought me through my career. And now when I buy a company, it's like, okay, go right to the marketing. Are they doing their segmentation? Are they marketing properly in line with that? Are they treating different customers differently? And that's sort of where we start.

Eric Dyck:

When you say treating different customers differently, give me some, obviously there's a lot of examples on what that exactly means, but what are the most critical ones that you look for? The most critical segmentations?

Drew Sanocki:

Yeah. I learned this lesson at Design Public, my first brand, but then at Carlo, which was a big streetwear brand, we acquired that out of bankruptcy. And it was sort of that exercise on the first day, you walk in and you look at their customer data, you lay it out on a table and you realize that you've got 20% of the customers are driving 80% of the revenue that most kids come in and buy from Caramel Loop, they buy like a $20 and they leave. They never come back again. So it's a one-time buyer. And then you've got on the other end of the spectrum, these kids who would come in and spend thousands of dollars on their first purchase and then buy again and buy again. And so it's a little bit nuanced, but you're like, okay, who are those 20%? What do they have in common? Are we all acquiring them from the same place? Are they all buying the same thing? And you just start to begin to realize you've got very different kinds of customers, and if we treat them differently, it becomes a lot easier to grow the business

Eric Dyck:

A lot more. Yeah, we're finding this right now with our content and our advertisers and the more niche down and dynamic you are with all of this stuff, it's pretty age old marketing, and we finally have the technology to do all the segmentation. I feel like there's a lot of marketers out there who don't always eat their own dog food when it comes to actually marketing to their own lists the way they might to consumers.

Drew Sanocki:

Because I think customer behavior and really human behavior in general follows that Pareto distribution where you see that sort of, well, I just went out of focus where you see that 80 20 rule everywhere, 20% of the people drive 80% of the results, and it could be a content business. And you realize the same thing that 20% of your readers are reading, 80% are consuming or clicking the most. So that's the first eye-opening thing is not all customers are created equally. And then the second eye-opening thing is if you dig a little bit, often more times than not, the cost of acquisition of one of your better customers is the same as one of your worst customers. I call them whales and minnows. So it's like, Hey, if it costs as much to acquire that kid who's spending $5,000 on streetwear as it does to acquire the kid who's spending 20 on streetwear, if I just reorient my marketing spend to acquiring more whales, I'm going to grow the company that much faster without deploying more capital.

Eric Dyck:

So marketing turnarounds like fundamental marketing segmentation, you would look at what else when it comes to turning a company around are things that you zero in on?

Drew Sanocki:

Yeah, I think of auto anything is another one we bought out of AutoZone. So all these brands, they're big and they're busted. They're doing a hundred million, losing 10 if I had to sum 'em all up. And they all, for a number of different reasons, have lost their secret sauce. And so you get in there and you've got often way too many people running the company. And when you look at who's running, when you look at the team, they've often starved the groups that were actually growing the company in Otto Anything's case, maybe the marketing and SEO teams that were originally growing that company. They're gone. And then you've got staff functions that are just have blown up. And so it's really a matter of changing the culture and trying to rebuild that secret sauce and identify the people who can rise up in the organization and then probably outsource or get rid of the other teams that really don't make a lot of sense given the mission of the company.

Eric Dyck:

This sounds like a positive version of what Ty Lopez was trying to do with some of his acquisitions, but I feel like from what I've heard, he hasn't been able to turn around in the same way that these ones have. 

Drew Sanocki:

I bid against him on a number of them, but in each case lost. So yeah, it's easier said than done. It's easy to come on a podcast and say, this is how you turn around a hundred million dollars company, but you really, it's like not until you get in there and look at all the data and meet the team that you sort of really can size up how hard this is going to be. I thought auto anything would be a one year turnaround and it was three plus. So it really depends.

Eric Dyck:

We just ran this mastermind in Las Vegas and a friend of mine who was doing affiliate stuff previously jumped into e-commerce and then he built his own store, but now he just buys them. And he was just saying, he's like, mate, he's like, this is a pretty good business. This idea of not doing the zero to one component, really coming in there and buying an established business, it seems like a huge, huge trend, not just for e-commerce businesses, but across all the boomers who are retiring in a lot of ways, this opportunity to buy businesses and turn 'em around.

Drew Sanocki:

Yeah, Cody Sanchez is really pounds the table on that, but I think that's one of my big learnings. If I look back on 20 years in DTC, buy versus build, and for me the bootstrapping, the learning, that took years at my first business to figure it out. And then when I sold that one, it was around when I got married and had kids. So just all, I couldn't do it again. I couldn't work seven days a week and 20 hours a day to bootstrap. And so I was just dragged kicking and screaming into buying businesses. But it turned out to be a great, I called it entrepreneurship in my forties because it was like you could buy a business, they've got customers coming in, you got revenue you could pay yourself. It's just a matter of fixing it, but you don't have to fix it when you're not making any money, which is huge as an entrepreneur.

Eric Dyck:

And in this era of lower multiples and rising headwinds, maybe for DTC brands, there's probably an increased opportunity out there to grab distressed operations potentially.

Drew Sanocki:

And I think it is, it's a better investment financially if you're an investment geek. I am think of growth funds versus value funds. Have you heard of this breakdown?

Eric Dyck:

No.

Drew Sanocki:

Different parts of just public investing, right? Different parts of the stock market. There are growth, there are growth stocks, which are you want to buy the rocket ship on the way up like Amazon. And then there are value stocks, which Warren Buffet kind of made famous and guys like Ben Graham, which is you want to buy the cigarette, the stories, you buy the cigarette but off the ground and you get a couple more puffs out of it. And it's not attractive at all. And it's not sexy, but the value investors are trying to buy often businesses where you look at the financials, the public financials, and you see they have more cash on the balance sheet than the companies trading at. So they're often just crappy businesses or airlines are always bought and sold by value investors. It's not Tesla, it's not Amazon. And I feel like in the world of DTC, we still got that value versus growth thing going on where everybody wants to be native deodorant and moist. Everybody wants to have the a hundred million outcome or whatever he had. But I think the reality is we all should be running our businesses for profitability and just thinking about them a little bit more like a value investor would, right? Because the odds of becoming moist are really low.

Eric Dyck:

And you spent a lot of your career, I think you've probably been on all sides of the coin for a long time, but you're on product side, you've now moved to build a SaaS company, and I actually didn't realize that PostPilot had such a through line to the very beginnings of your career with your furniture business as well. Let's dive in on that a little bit more. First of all,

Drew Sanocki:

That's the origin story, man.

Eric Dyck:

Yeah. What brought you to PostPilot? Yeah,

Drew Sanocki:

I mean it was really like that's how I learned how to market was going to the library, getting books out on catalog marketing, and they popularized this idea of RFM, recency frequency monetary value. It's how they segment their customers. Fast forward a couple years and I'm like, this is any marketer will tell you your best target is always previous buyers. And I'd buy these brands and I'd look at their email lists and I'd say only 10% like Carlo, I don't know how many 5 million names on their list, only 10% or actively, sorry, 10% of their previous buyers are actively opening their emails. So you're just like, well, how am I going to get the other 90%? And of course you lean into SMS and Facebook and everything else, but direct mail was a great way to take whatever's working on email, like a Black Friday offer or a win back and just flip it to a bigger audience.

So that was the use case that I did again and again, I did a caramel loop, I did an auto anything, and there was no simple tool to do that. It was like sinski's got download a list from Shopify and find a printer and send the postcards and then try to back into attribution. I was like, no, it's got to be Klaviyo for postcards. So in 2018, I bought what is now PostPilot, another acquisition, bought it off the developer. I was like, that kind of gets us there, but it needs to be Klaviyo for postcards. He said, what are you talking about? And I was like, spent a year or two on the product with him and that was the genesis of it. I wanted to plug into my stack and be able to extend my marketing on the retention side, extend my marketing to a bigger audience. And since then it's gone on and now it does full funnel, it does acquisition, but at the beginning, that was the genesis of it,

Eric Dyck:

Direct mail. It is funny. I was asking your opinion on chat GPT for this piece we're putting out and you're like, I'm going the other way, man. I'm, I'm going physical. And so I have not been in this physical marketing world. I don't understand. I've heard that you actually, you can just buy addresses. It's not the same in terms of can spam and owning email. You can direct mail cold, you can direct mail, warm. I guess you're talking about taking email addresses where you may not have addresses and trying to back calculate into addresses. Or in your case, do you also have addresses?

Drew Sanocki:

Well, obviously, I mean, if you run a Shopify brand, you've got the addresses of all your customers in your store.

So there you use direct mail just to extend, just to make sure you could drop a mailing to them, whether they've opted in or not. So the law says you basically you have to honor the request to unsubscribe, but you do not need the opt-in. So it's like you could hit all your previous buyers, right? No other channel can do that. On the acquisition side where you don't have the address, there are a couple of things you could do. You could use, we've got some matching technology where site traffic, we can correlate that to a physical address and you could drop a card. Think of that as postcard retargeting. You could give us a list of email addresses that have never purchased and we could correlate that to a physical address and drop a card. And in both cases you are using third party data sources that are essentially publicly available to get that info.

And then on the pure acquisition side, again, there's more you would up until now, go to a direct mail agency and buy lists, which you could do in email too. I think. I've never really gotten it to work in email, to be honest, like cold list buying or cold emails to lists. But in direct mail, you can target it by these people bought skincare online in the last six months. You could do a lookalike off your best buyers. You can layer on a lot of demographic and geographic attributes and then drop postcard campaigns or catalog campaigns to them, and it works. You're not going to get a 10 XROI on an acquisition campaign, or you're lucky if you do, but a lot of brands now are happy with one and a half to three ROAS on an acquisition campaign. So it's been good

Eric Dyck:

Over the course of what time? What are the time windows like with direct mail? Is it, I remember I was talking with some other offline things like billboards, podcasts having a much more stronger latent effect over time, or is this more of a direct response method just in their mail, they're getting it the next day?

Drew Sanocki:

Yeah, certainly direct mail started with that direct response, like old sales letters by guys like Gary Halper and you read 'em and it's like buy now or mail this in and get a 20 CD info package on something. But I mean, we see, if you were to push a campaign out today, it probably hits someone's mailbox in three days to a week. I think the attribution windows are just longer than what we're used to online. So we like to say 60 days because people get a piece of print collateral and they throw it down on the coffee table or they tack it to the fridge. And so what we see is just like, Hey, it's a very long curve that extends out over a couple months when people are redeeming the offers. Right.

Eric Dyck:

Yeah. Okay. Walk me through a campaign then. What are the most successful, obviously extending offers to your existing audience, your existing customer base. Mother's day is coming up, what are the most successful brands doing for Mother's Day with direct mail?

Drew Sanocki:

I think in that case, I would think about you break it into retention and acquisition. On the retention side, you take whatever's working in email, whatever you're doing in email that's working, flip it into direct mail is kind of like a no-brainer, and that could be a one-off campaign like Black Friday or Mother's Day. Imagine how good those campaigns are. Well, you're just extending the audience to people who had never subscribed or are not opening your emails. Or it could be an automated campaign, like a win back abandoned cart, second purchase. If that stuff's working in email extended into direct mail acquisition side, I mean that's probably, that's your catalog drops or your tri-fold drops or where you're trying to get more customers and we see a lot of apparel brands doing, that's when they announced their new spring collection or something through that or I'm trying to think of more. Can we time out for a sec?

Eric Dyck:

Yeah, yeah, sure. Declan just yell Declan, huh? Declan will edit it all.

Drew Sanocki:

Alright, where do we want to pick that up?

Eric Dyck:

Well, my question, just my question goes to what percent we like to talk percentages of ad mix kind of thing on the podcast between TikTok and Google. Where does direct mail sit in terms of your ad mix for a brand that's really rocking it?

Drew Sanocki:

It's got to be a hundred percent, man, a

Eric Dyck:

Hundred percent direct mail.

Drew Sanocki:

You heard it here first. No, our goal is just to be, I would say to be a top four. It's like I want every CMO to think in terms of organic paid email and direct mail, and it's going to vary by the brand. I think it's just another channel. I think one of the things we learned, we've learned, again, I've learned it several times, but I would say younger people have learned it the first time is don't go all in on one channel. I mean, I learned that lesson with long tail SEO. I learned it again on AdWords and I learned it again on Facebook most recently where you go all in on one channel, put all your chips on one, and then iOS happens and that channel goes away. Or I don't know, a couple of weeks ago Facebook ad costs went through the roof for one weekend. Do you remember this? Yeah. It's like, okay. I think in Underpriced ad channel made everybody a lazy marketer where for years there really for 2015 to 2020, everybody was a Facebook God. It was just like everybody and their brother was like a Facebook stud and it's like, oh, this is an ad God, A funnels God, A funnels bro Ninja. Yeah,

Eric Dyck:

Ninjas too.

Drew Sanocki:

Yeah. We're just looking at the results of an underpriced ad channel, like anybody who throws money in there is winning. And I think now that costs have returned back to reality or maybe the arbitrage is gone. You've got to be a good marketer again. Yes, I want direct mail going and I want organic going and I want email going. It's just another arrow in your quiver.

Eric Dyck:

And I think one of the things I was listening to the ButcherBox CEO the other day just talking about there's a fine line as a pilot house agency that does every kind of traffic source under the sun. We love to talk omnichannel, but there's also, you have to balance that with attention creep and making sure if you're doing eight different things that make sure that you're actually measuring incrementality as well. But I think there's a happy medium that you're talking about with the four rider there. We're talking about with the socials, the Googles, the email and the direct mail obviously.

Drew Sanocki:

Yeah. I mean there obviously plenty of brands that don't do direct mail and I know a handful that have grown to 20, 30 million in revenue only off direct mail, which is kind of weird, but I just think it's part of the mix. I realize it's a heavier lift than setting up a Facebook ad campaign. So I think you got to be at a certain scale with a certain A OV typically where it works better, but at some point it does become a no-brainer, especially on the retention side.

Eric Dyck:

I think delight is something I always like to talk about in customer experiences and getting something in the mail is just delightful. There's just an aspect to getting something in the mail that I still like. It doesn't happen that much. Can you think of any examples of brands that have, what's the most delightful thing a brand has sent in the mail with PostPilot that you can talk about?

Drew Sanocki:

Feastables was doing some cool stuff, but I'm not sure I'm allowed to talk about. I think there's the standard, I think the coolest thing we've got going on now is our tri-fold format called a card log. So there's a lot of rules of thumb and direct mail that are all really boring, but one is if you're going to acquire new customers, you want to show them a selection because with, in other words, as opposed to one product, you want to show them like 10. So the reasons just higher likely you're going to a cold audience. It's a higher likelihood of conversion to justify the cost of the mailing. Catalogs are a pain catalogs you work on for six months with a creative agency. You've got to line up a printer, you've got to line up paper. What if you change pricing? What if something is out of stock?

This is why nobody, it's a dying industry. So we said, well, how are we going to get extensive selection on a piece of print collateral that scales in a way that brands could test into it? And we've moved to this tri-fold format called a card log, which dynamically can pull products out of Shopify. You can change pricing on the fly. It goes out on a rolling basis. So I try to think of it like a Facebook ad buyer, give me my lookalike, okay, here's the audience and now I'm going to drop this product to them a couple hundred a day or whatever the rate is, and I see the results in a week. So I think card logs are really interesting on the acquisition side and it's probably one of the cooler things we've got going on right now.

Eric Dyck:

Cool. Innovation in direct mail. Love to hear it. I just love to, you're just a story. I feel like you've had so many lives or careers within the DTC career and is this your biggest win is PostPilot so far? I guess you've probably had a lot of big wins, but is PostPilot trending one of your biggest wins?

Drew Sanocki:

TBD, but I would say yes. It's like I'm 51 years old. I feel like this is the culmination of 20 years of what

The turnarounds were. Great. You're rarely going to hit a home run on a turnaround. The private equity community's very pleased with a three x return on their invested capital after a couple years. So it's a little bit more like going for doubles. You're just kind of like you buy these things for a buck, you sell 'em for three in a couple years and everybody gets a piece. But yeah, PostPilot, I think it's tapping everything. It's like my knowledge of e-commerce, my knowledge of building a team, which I kind of learned in the Navy, it's how to build a brand. So it's a lot of, it's sort of coming together and just to make a time, man, I got to retire in a couple years.

Eric Dyck:

I just love stories because DTC is the most successful thing I've been a part of in my 43 years and just to know I could fuck this up and still have a big win in my look,

Drew Sanocki:

It's great. She finally made it, son

Eric Dyck:

Did it one.

Drew Sanocki:

Yeah. Everybody who's watching this podcast can point to me as an example of somebody who's not made it until 51 and then made it, but

Eric Dyck:

Actually you got a lot of making it, but I just love it for Gen X. Just love it. For Gen X, we're still ruling the roost here, right?

Drew Sanocki:

What's the gen after Gen X? Who are the young kids these days?

Eric Dyck:

Oh yeah. How old are your kids? You've got a couple kids, right?

Drew Sanocki:

Yeah, eight. Eight and 10.

Eric Dyck:

Eight and 10. I have a 9-year-old and I just heard the term that scared the shit out of me the other day called screen age that that's the one term did see that. I saw that some screen age, I'm like, Ooh, I do not like that. But I feel it in my soul after the homeschooling effect of Corona and all that it was. But don't you

Drew Sanocki:

Feel like our it's, I don't want to say it's easy to make a buck these days, but I think if you are on Twitter and you follow the hype, it's like these people in their twenties and thirties are accomplishing what it took me 51 years or whatever to accomplish, and I guess it's great. It's just like there's never been more opportunity than now to do that.

Eric Dyck:

And fewer excuses probably too. I think there was this e-commerce heyday that we've kind of been a little hungover from. It's still trending up overall, and then everything else is getting you just tell GPT agent to do it or whatever. I just bought chat. DTC, by the way. So look out, you gave me your high level take on ai. Are you guys using it in your business or I imagine there's ways to be more dynamic in the way you message campaigns using ai. What are your overall thoughts on AI as a elder statesman of the biz? Yeah,

Drew Sanocki:

Yeah thanks man. 

Eric Dyck:

It’s not a nice thing. I shouldn't have said I was. It's bit aggressive. It's fine. Say it. 

Drew Sanocki:

 I think, I mean, everybody's played around with it. It scares me. I'm glad I run a business that has printers and real world constraints on supply and it's a little bit of a moat that I think keeps some kid in a basement from building PostPilot. So we have our own printers. Did I tell you that? So we are vertical,

Which at first I was like, this isn't cool. I want to be a software company. I don't want to be a printer, but it's a bit of a moat. And now more than ever, I think man in software in particular, more so than DTC, I'd be watching my back 24 7. Someone could, how long until somebody comes up with a chat version of the intelligence that's in Klaviyo or these very big companies could be disrupted so quickly through ai. We're trying to, I mean we're using it in our business just like everybody else's messing around with it. You're trying copywriting and landing pages and I think there's an opportunity to do some AI in the onboarding on sort of campaign development and audience development. We're certainly working there. That's interesting. But I don't think, I would hope our business is not as vulnerable as a pure software company to ai. Yeah.

Eric Dyck:

I've had three companies reach out to us to be like, Hey, you can just write a whole newsletter at the touch of a button, which is always interesting to me. And that's why I think the podcast you were talking about, starting your own podcast, restarting that the podcast, these human connections we make until I can just program an avatar of myself to have these conversations for me are still going to be really valuable and harder to replicate. I think I use them for summarizing them and making sure I'm hitting SEO notes and other, there's other things that I use to make podcasting easier with it, but just still the ability to be really, I was actually curious about, I saw your post and I didn't read the comments. What is it that chat GPT can't replicate about a Gary Halbert sales letter? I've actually had chat GPT write sales copy for me using specifically Halbert and other people, and it's done a pretty good job. What's the thing that GPT will miss in a Gary Halbert sales letter?

Drew Sanocki:

I hesitate to say it because I feel like in two weeks it'll become irrelevant. But I mean, if you played around with it for copywriting,

Eric Dyck:

Yeah,

Drew Sanocki:

It's good. You can still tell it's written by ai and I think the great copywriters can tell a story and they can connect with you on that human level that, I'm not saying it could never be done, but it's just that's the challenge. That's the hill they got to climb.

Eric Dyck:

I'm just going to build into the intro of this and all content that we write that it now may self-destruct within 20 days. All of this stuff is changing so rapidly, so yeah, it won't let you die on that hill. But yeah, no, I find that all the time, every time that sales copy works well for us. It has some weird thing that I threw in there about this or that story or just all these humanizing elements that you put into your copy that Chet gt so far. It really only just skates along the surface of, and kind of pays lip service to and doesn't really dig down to that juicy, interesting level that I think so much sales copy has.

Drew Sanocki:

Right.

Eric Dyck:

Very cool. Nice man. Any other high level trends that you see? Any other high level trends you see in the e-commerce space that you'd want to call out? For our listeners

Drew Sanocki:

Trends, I think it's like we've just returned back to this baseline, which we probably were at pre covid, 10% year over year growth. It's still a great place and a great time to start a business. I just think it's not a trend as much as I think the brands that are going to win, or for most of the people listening to the podcast, you should just focus on starting a profitable business or buying one. I think we just got so fixated on growth for a while on rocket ships and on sort of exits and on venture funding, which I don't even know if it belongs in DTC that we got away from like, Hey, I need a business. That cash flows and sort of all value comes from that. I think that's a much more reasonable target, certainly less risky for an entrepreneur to go after. And I think the brands that win are the one, if you've got cash flow, you can weather almost any storm. So I think the brands that you run a profitable business, you focus on your best customers. You look at constantly finding new pools of inexpensive customers to acquire, and part of that's probably going beyond DTC to brick and mortar. Those are all keys to success.

Eric Dyck:

What's the difference? I'm just minding your tweets again from a while ago as well. You mentioned the difference, entrepreneurs needing to know the difference between CAC and marginal cac. Can you explain that to me?

Drew Sanocki:

Yeah. I think everybody's a little bit disillusioned by their own success, right? It's a niche business. Most of us run niche businesses. We sell street wear to kids in the inner city or whatever. We sell plant-based protein powder to vegans who do CrossFit. And I think the illusion of the niche business, they all grow incredibly fast early on because customers are cheap to acquire. But if you look, it's because you're acquiring all the cheap customers. If they're easy to acquire, you're acquiring them, and over time, the cost of acquisition is going to go down because you've acquired all the cheap customers, you've penetrated that niche, and then it gets more and more expensive to acquire a customer that's more your marginal CAC as opposed to your overall cac. So as any business grows, that marginal CAC is going to be harder and harder to hit to meet. So I think it's instrumental to look at what's the marginal cost of acquiring a new customer across various channels, not just the historical one that I've had over the past to acquire all the customers I already have

Eric Dyck:

A hundred percent. Very cool. Drew, thank you so much for coming on the podcast today. If you're listening, go check out PostPilot, talk to Drew. He's a mech. I think that's what ez Ezra described you as a minch actually, and I had to Google what a mech was, and I think that's one of the reasons I been so persistent. And now I think you may become a regular guest. It's been great having

Drew Sanocki:

You. I would love that

Eric Dyck:

On the podcast, drew.

Drew Sanocki:

Yeah, shoot me an email. Anytime I talk to people, I'm on Twitter, I'm on the Twitters. That's the story Ezra loved is Twitter started across the hall from us. We were running our drop shipper selling furniture, doing like a million dollars a year. We thought we were badass, and across the hall we're four guys who started a podcasting company called dio, and it wasn't working. So they started sending these group messages around and they put us on their distribution list and they were like, Hey, we're going to lunch. You want to go to lunch? We're playing Frisbee. And we're like, no, man. We we're busy running our profitable million dollar furniture business. And that was Twitter. They had just discovered a way to do group messaging, which again, ultimately became Twitter, but Noah and Evan and Jack, they were all across the hall right there. Ezra loves the story. I'm not sure why he loves the story so much that I missed on the opportunity to join Twitter or that they were in the same building or that I'm old enough that I knew them, but whatever.

Eric Dyck:

Probably something to do with all of them, I think that's great. I was just relating some of my funny stories of my weight. I used to have very tight relationships with Yahoo back in the day, and I had some very funny stories about the kind of sketchy advertising I was able to get onto Yahoo and how Carol Barts famously remarked one time about an ad that she saw that I had placed, that she was quite disillusioned with all the dating ads that were in her Yahoo Mail feed specifically related to my, that was my best brush with fame there.

Drew Sanocki:

That's funny.

Eric Dyck:

Thanks Drew. Well, good luck with everything and yeah, let's stay in touch, man. This was fun.

Drew Sanocki:

This was great, Eric, thanks.

Announcer:

On this season of the Nerd Marketing Podcast, you'll hear from the Wharton professor who literally wrote the book on customer centricity, along with Drew and Michael's experience in private equity and advice from VC firm partners on what they look for in investments. And you'll hear topics about brick and mortar retail strategies for CPG brands and much more. Alright, drew and Michael, we'll be back very soon.