EP289: Improve Your ROAS: 3 Mistakes to Avoid and Key Metrics to Track

Common mistakes include relying on a single sales channel, neglecting key metrics, and overspending on ineffective ads. These can lead to poor return on ad spend and hinder business growth.

Key Takeaways

  1. Avoid single platform dependency.
  2. Track key metrics for better ROAS.
  3. Identify distressed assets for growth.
  4. Diversify channels to mitigate risks.

Neil Twa (00:10.274) All right, we're waiting for everybody to get in…

Neil Twa (00:10.274) All right, we're waiting for everybody to get in here.

Neil Twa (00:30.978) Hey everybody. If you're watching this right now, we're…

Neil Twa (00:30.978) Hey everybody. If you're watching this right now, we're actually live. So we're doing something fun today. So if you see this and you're chatting out there in the great world, come say hi to us. There's a live chat here. We may answer questions live as we do this today, doing something imperfectly, just having fun, bringing on a fast and furious new friend of mine who had a wonderful conversation with him the other day. And so as we talk about...

the business of e-comm, I invited him to come do a live…

the business of e-comm, I invited him to come do a live chat with me today and that's what we're doing. So if you guys are out there in the world and you're watching this, that's awesome. If you're watching the recording, go ahead and show the comments and we'll get back to you later on anything that you put in there when it's not live. But I brought Sim in because he's a multiple eight figure seller in the DTC world. We're going to talk about building a brand. We're going to talk about making brands go faster. We're going to do this and perfectly even when our systems all say they should be silent, they're not.

Let's put everything on silent here. There we go. No more disruptions.…

Let's put everything on silent here. There we go. No more disruptions. Hey, Sim, welcome to the Call Brother.

Cem Atik (01:29.737) Hi, I'm Happy to be here. Happy to, yeah,…

Cem Atik (01:29.737) Hi, I'm Happy to be here. Happy to, yeah, just talk about our topics. Just really curious for the call for several days.

Neil Twa (01:35.118) Yeah, man. let's get, yeah, let's get into it.…

Neil Twa (01:35.118) Yeah, man. let's get, yeah, let's get into it. We're going to be in the DTC ecom world. Let's talk about building, growing, scaling, maybe give some insights into what you're doing. Let's, let's unpack this just a little bit. You are in Germany, if I'm not mistaken. And you have been building ecom for quite a while. I want you to give me some insights into what you've been up to.

Cem Atik (01:52.063) Correct.

Cem Atik (01:52.063) Correct.

Cem Atik (01:58.463) Sure, mean, my way was pretty normal. started Ecom…

Cem Atik (01:58.463) Sure, mean, my way was pretty normal. started Ecom or overall marketing like 13 years ago, starting in a small agency on small projects and getting better and better. yeah, started to solve things that other people maybe don't solve because I'm just really a numbers guy. Yeah. So I just figured out really early that I just only interested in numbers. And if someone is just...

Episode Summary

In this episode of the High Voltage Business Builders Podcast, Neil Twa and Cem Atik explore how ecommerce brands can enhance their return on ad spend (ROAS). They identify three common mistakes that often undermine ROAS and outline the key metrics that sellers should track. This discussion is essential for Amazon and ecommerce sellers at every level, from beginners to those managing multi-million dollar brands. By understanding these pitfalls and focusing on the right data, operators can make informed decisions that drive growth and sustainability. Cem Atik, founder of Harucon Ventures, shares his expertise in scaling brands to eight figures and flipping them like real estate. He emphasizes the importance of channel diversity and the risks of relying on a single platform. The episode provides actionable insights, such as identifying distressed assets and turning them into profitable ventures. These strategies are crucial in today's competitive ecommerce landscape, where adaptability and strategic planning can make all the difference. Whether you're just starting out or looking to optimize an established brand, this episode offers valuable guidance on improving your ROAS and building a resilient business.

Frequently Asked Questions

What are common mistakes that affect ROAS?

Common mistakes include relying on a single sales channel, neglecting key metrics, and overspending on ineffective ads. These can lead to poor return on ad spend and hinder business growth.

How can I improve my ROAS?

Improve your ROAS by diversifying sales channels, closely monitoring key metrics, and optimizing ad spend. Identifying and fixing these areas can lead to better returns and sustainable growth.

Why is channel diversity important for ecommerce?

Channel diversity reduces the risk of dependency on a single platform. It ensures that if one channel faces issues, others can support sales, maintaining stability and growth for your ecommerce business.

Full Transcript

Neil Twa (00:10.274) All right, we're waiting for everybody to get in here.

Neil Twa (00:30.978) Hey everybody. If you're watching this right now, we're actually live. So we're doing something fun today. So if you see this and you're chatting out there in the great world, come say hi to us. There's a live chat here. We may answer questions live as we do this today, doing something imperfectly, just having fun, bringing on a fast and furious new friend of mine who had a wonderful conversation with him the other day. And so as we talk about...

the business of e-comm, I invited him to come do a live chat with me today and that's what we're doing. So if you guys are out there in the world and you're watching this, that's awesome. If you're watching the recording, go ahead and show the comments and we'll get back to you later on anything that you put in there when it's not live. But I brought Sim in because he's a multiple eight figure seller in the DTC world. We're going to talk about building a brand. We're going to talk about making brands go faster. We're going to do this and perfectly even when our systems all say they should be silent, they're not.

Let's put everything on silent here. There we go. No more disruptions. Hey, Sim, welcome to the Call Brother.

Cem Atik (01:29.737) Hi, I'm Happy to be here. Happy to, yeah, just talk about our topics. Just really curious for the call for several days.

Neil Twa (01:35.118) Yeah, man. let's get, yeah, let's get into it. We're going to be in the DTC ecom world. Let's talk about building, growing, scaling, maybe give some insights into what you're doing. Let's, let's unpack this just a little bit. You are in Germany, if I'm not mistaken. And you have been building ecom for quite a while. I want you to give me some insights into what you've been up to.

Cem Atik (01:52.063) Correct.

Cem Atik (01:58.463) Sure, mean, my way was pretty normal. started Ecom or overall marketing like 13 years ago, starting in a small agency on small projects and getting better and better. yeah, started to solve things that other people maybe don't solve because I'm just really a numbers guy. Yeah. So I just figured out really early that I just only interested in numbers. And if someone is just...

Discussing with me and that makes not logical sense for me. I just usually ignore him. Yeah Brings me in a lot of trouble, but honestly on the business side makes a lot of sense and I had a lot of fun in this time and a lot of people I just got interested and curious about my person at all because they figured out okay. This guy is doing numbers. Yeah Yeah, I just I just move. Yeah move forward working on several agencies in some leading positions

Neil Twa (02:29.517) Yeah.

Neil Twa (02:45.4) Yeah.

Cem Atik (02:52.713) figured out that this is not something that I will do my whole life. yeah, that brings me to the position where we start to get shares and equity in brands, scaling them, fixing them, yeah. And then flip them basically. We do this basically like other people would do it in real estate.

Neil Twa (02:55.48) Mm-hmm.

Neil Twa (03:05.326) Okay.

Neil Twa (03:09.048) Yeah, finding a little bit of a distressed property or an underserved property and building it back up, making it clean, and then flipping it for sale.

Cem Atik (03:17.095) Yeah, exactly. mean, distressed assets are my favorite ones because there's nothing that you just can buy cheaper.

Neil Twa (03:24.03) Well, yeah, a fire sale on the way down usually if there's problems going on. What are the couple of like top three things maybe you look at in a business that you know is going to be a great deal for you? The three things that maybe they're not doing right that you're like, hey, that's a great business buy.

Cem Atik (03:39.157) Sure. The first thing that we always look on, I mean, when we're just talking about distressed assets, the first thing is looking on is why these guys getting bankrupt, why these guys are going to insolvency. So if the unit economics, the numbers are great, is it a marketing thing? Is it a management thing? Is it a people thing? We just try to figure out what exactly are the issues. Because most of the times the numbers are great. The margin is solid. Could be better for sure.

Neil Twa (04:00.652) Yeah.

Cem Atik (04:07.487) But then something happens like supply chain issues or founder issues or marketing spend is too high. And that's usually things that you can easy fix. One big issue that we always have in mind is channel diversity. Let us say a brand is there, they started on TikTok shop as example, or on Meta. And they have only one channel which is driving 80 % of the revenue, which is the most common.

thing while brands are dying because there's only one channel. What happens when meta ban your account? What happens if TikTok shop is saying like, no, you cannot do any longer what you're doing here, right? So you exactly. Yeah. So you, you, you're sitting in, in, in, in, in front of a ton of products and cannot sell them because your main channel is basically done. And yeah, that's pretty much it. we're

Neil Twa (04:33.121) Mm-hmm.

Neil Twa (04:42.167) What happens when Amazon jacks around with your brand? Yeah.

Neil Twa (04:53.633) Yeah. Well, what is the typical new reason of founders in that position? Is it just a lack of knowledge for the other channels or a lack of attempt to get into them? Or is it just simply focused on time, energy, money, attention?

Cem Atik (05:07.573) Yeah, that's actually mixed. what founders usually do is two things. Yeah, there is one founder, let us say person one, or person A, they just try to do everything in house, which is the baddest way that you basically can do. Yeah. If you just build a house, you get the guy for electric, for doing the electrical things, you just get a guy for the bricks and the wall. Yeah. You're always trying to work with experts if do something. And that's also something that you should do in e-com because

What happens is if you're just working with people which are not experts is that you will fail 100%.

Neil Twa (05:41.614) Yeah. Yeah, I it ends up being a, in my world, what I normally see is either a lack of knowledge or unwilling to attempt the knowledge or just a focus of time and energy, um, in a specific area they're trying to approach or in a lot of ways, the fiscal, uh, aspect of fiduciary, the management, the money, um, that is also a huge challenge. Is that something that you overcome when you buy these? Is that one of the variables?

Cem Atik (06:05.909) We actually have a brand we are talking with. What happens is that his accountant just made a few minor mistakes and what happens is that he just pay a lot of late fees. So they just need to pay like 400K and he don't has this 400K and we can now buy in and get 51 % for 600K. And this brand is already doing 5 million in revenue with an EBITDA of about like 15%. It's free for us.

We just want to help for sure. We just want to take all of this headage and all of these problems away from the founder. That's why we just buy equity on brands like these. But that happens also. You're just getting a lot of trouble with taxes. mean, in Germany, pretty much the same as in the US, taxes are in the same position, maybe like the present, could say, or maybe like the government. If you're just doing fun with taxes, you end up in jail.

Neil Twa (07:04.001) fun with taxes. Yeah, they're having a lot of fun with our taxes, aren't they? I'm not gonna be a sideways toffee if we're not careful. Get ourselves in trouble. We love taxes, wink, wink. We like, yeah, I'll stop there. But yeah, I think that's a normal affect of what I would say is the fundamentals of business, which I think what you're looking at is somebody who had an opportunity to get going, got a few things up and running and then well,

Cem Atik (07:05.333) Let us say fun with Texas.

Neil Twa (07:31.019) maybe didn't have all the business management fundamentals in place of actually how to run the company.

Cem Atik (07:38.017) That's correct, yeah. So you have these issues all the time. I don't think that is only common for e-commerce. I think you can find this everywhere. doesn't matter what you're doing. If you do SaaS, if you do, you could do labor work. It doesn't matter at all. But in e-commerce, because it's usually driven by young people, it's a bit more common, I think.

Neil Twa (07:39.606) Yeah

Neil Twa (07:46.653) yeah, no.

Neil Twa (07:57.676) Yeah. Are you brand agnostic? is there, I mean, you don't necessarily care what they're running or what product type or have you niched into a specific area of brands you like to work with?

Cem Atik (08:07.317) My favorite is actually to stay in niches which have a high repurchase rate. Yeah, consumable products because it's much easier. Yeah What I stay away from is fashion if it's possible because I hate fashion Return rates are our bonkers. I hate it. Yeah, so yeah, yeah Exactly. So they they they exactly know okay I have number X and they still offer one one size smaller because it could fit and then they send it back I hate it. I don't like that

Neil Twa (08:23.393) well, sure. Yeah, nobody likes this wrong size of shoes, right?

Neil Twa (08:35.457) Yeah. Now I don't like those ones either. Yeah. Or print on demand. Supplements. Yeah, no. Those are so tough.

Cem Atik (08:37.36) Yeah, supplements, consumable goods. Print on demand is also a scam if you're just asking, but yeah, that's another business.

Neil Twa (08:47.585) Well, it has its place in some affect. I think you have to really brand it. That's the differentiator at the end of the day. Even if it's Brenton and you have to really brand it. But.

Cem Atik (08:56.553) Honestly, in these days, I think the margin is not thick enough that, yeah, that works.

Neil Twa (08:59.767) Well, there's where you get down to the problem. Yeah. Scalability with printing is very difficult. I have a friend who runs a large...

Cem Atik (09:05.087) Correct. If you just do on your organic, if you just only do with your social media, do print on demand. Yeah. But if you just run paid ads, print on demand is not working over the long run. Definitely.

Neil Twa (09:10.517) Right. Ads is going to be too much. CPM costs are too high. Yeah. For especially for traffic on that. Yeah. And you've got to really brand it and create that brand asset around it for sure. So supplements for sure. That's that's one, you know, we played on that with Amazon a long time ago and found out that there's just too many three letter agencies looking over the top of you wanting to scrutinize every letter of your copy, et cetera. And it can be very

Cem Atik (09:34.645) Definitely.

Neil Twa (09:35.309) profitable, can be very viable, can scale very fast. There's just a lot of complexity in it. It's certainly not a startup game. For those of you wondering, should I start up a supplement company? Not unless you got a minimum of a quarter million dollars. I don't know if you would agree or disagree with that, but I would say if you got a quarter million dollars you want to blow to just find out where your audience is. Yeah.

Cem Atik (09:59.253) actually depends. There's other channels that can just bring even first order profitable supplement stores alive. Here's one thing that a lot of people are not realizing. Supplement is a retention game. If you know the retention game and know how you can just be maybe barely first order profitable and can just get like a 30, 40 % repurchase rate, then you're winning. You only earn money over... Yeah, correct.

Neil Twa (10:07.106) Mm-hmm.

Neil Twa (10:24.365) So you're talking about LTV, right? You're talking about lifetime value really at the purchase.

Cem Atik (10:27.849) You only earn over retention over the long run because Google on some point is getting less and less profitable. Meta is never ever getting really profitable. That's really happened barely. Yeah. So you just need to buy new customers and need to make them just train them to be loyal, long-term customers. Yeah. That's the only goal where you can win with supplements in these days, I would say. Yeah. Maybe a bit different like five years ago, but right now it's the only way to do it.

Neil Twa (10:48.087) Yeah. Yeah.

Neil Twa (10:54.763) Yeah, true. So we got supplements, we got fashion, what else?

Cem Atik (10:58.709) Fashion, yeah, we stay away from I really like electronics. Yeah, so like like hair blowers like like like yeah stuff around beauty is really great Yeah, overall anything that that you can consume snacks is also good beverage overall is good but I personally if you just ask me what I like the most it's it's it's Electronical products electronics basically like like like they had like

Neil Twa (11:23.831) Hmm. Hmm.

Cem Atik (11:27.987) Like in the head rise example, yeah, or something like like in razor, right? You buy the razor once and then you just buy the blade stuff like that. So that is something that I really like because you can just build.

Neil Twa (11:39.117) They're going have repeat consumables behind electronics, so they're going to keep subscribing to the new razor blades.

Cem Atik (11:42.261) That's the first thing. That's the first thing for sure. And you have a high average order value. So what happens is you are just between 150 and $250 as example. And if you sell a $50 product or $150 product, the effort is pretty much the same. If you're just looking on Google and retention and also meta, it's getting a bit more effort, but that's it. And it's much more fun, much more.

Neil Twa (11:48.46) right

Neil Twa (12:04.203) Yeah. Well, and I define it separately as like electronics and electric products. So too much electronics, dangerous manufacturing defect, return rates, customer support. These are all issues you have to attend to. However, we have quite a few electric products with onboard, you know, firmware, which is very different than constant updates, software updates, you know, those kinds of things. I like those products. Those products sell well. They sell at good price points. There's great margin in them.

So I call those electric products versus electronic products. And there is a differentiator to the two. Like I'm not selling cell phones or highly complex, you know, software type products with firmware and hardware built into the software. Yep. That's to try to not complain. Although we had a review the other day on one of those products like that. And there's a pre-temperature set on the product. And while they,

Cem Atik (12:35.871) Yeah,

Cem Atik (12:43.349) It must be simple that people cannot complain a lot, that's really important.

Neil Twa (12:56.691) admitted that the pre-temperature didn't quite make it as hot as they wanted. They had to turn up the heat to make it hotter. They left us a two-star review because the preset temperature was not hot enough. So they had to turn the heat up to make it hotter. And I'm like, face palm. I'm like twink, like, come on. You got a two-star review. The product was working. You actually admitted that it worked. And then you just didn't like that the preset wasn't hot enough. Okay. We call it.

Cem Atik (13:12.852) We-

Cem Atik (13:19.967) So at least it's a good sign that not only Germans are really weird in their reviews. Last month we got a review, I never will forget that, and the review was, doesn't feel well when I have it in my hand. And I was like, what are you exactly talking, I didn't get it.

Neil Twa (13:24.054) my gosh, dude.

Neil Twa (13:32.041) Right, well we'll get some other dumbass called.

What? I just don't prefer the size of the bowls. I think they're too big. And we literally told you what the sizes of the bowls are. Like these are the sizes of the bowl. And the person's like, well, this bowl is too big. Well, there's a smaller one. Use the smaller bowl. Really? And then there's fake reviews, which is harder to overcome on Amazon than it is in the direct to consumer world. And Amazon, they lock that review in and you're your host. And if it's a legit win one, of course they stop you from trying to reach that person, which is really annoying. So the person gets mad because you're not responding. Yeah.

Cem Atik (14:01.769) Yeah, just need to... Craig, you just need to... I mean, there is a policy, I think they are really strict there. And if they just violate the policy, then it's fine. Yeah, but otherwise they don't remove the review, right?

Neil Twa (14:11.821) Yeah

No, it's terribly hard to get rid of. And then you'll look at the profile and you'll see that they have like five other one star reviews and nothing else. And you're like, that's totally a fake profile. Like somebody bought that was paid to fake review that just to knock us down. Right. And that happens actually quite a lot. People don't realize that there's quite a lot of unethical online stuff happening.

Cem Atik (14:35.517) Actually giving fake reviews is against the law in Germany. Not sure if that's the same.

Neil Twa (14:38.605) It won't take in salon America too, but who's enforcing it? The online fake review, please. Cause I don't think they exist. I was on certainly not stopping it they don't, they don't care, man. It's it's, you know, you can't get those removed and then they, know, we would help the customer if they were legit and there are some legit complaints and sometimes it's just preference. Okay, fine. You have a preference. We were cool with preferences, but is your preference really a two star? Um,

Cem Atik (14:42.184) Yeah, that's the point.

Neil Twa (15:04.109) It was your preference, right? The product worked great. I thought it was good. It cooked really well. However, the bowl was too big, so I left it two stars. Like, really? Wow. Absolutely.

Cem Atik (15:06.453) I mean.

Cem Atik (15:14.465) I mean you cannot make everyone happy, I think we agree with that, but there is one thing, there is always people which are literally looking, they have a bad day and they look to just release their energy, their negative energy and then they just write reviews like that. I think it's a shame, but yeah, mean it's part of the business.

Neil Twa (15:28.31) Absolutely.

Neil Twa (15:33.473) Yeah. What are your favorite channels for traffic right now? What do you think? Yeah.

Cem Atik (15:37.109) For traffic, that actually depends on what kind of product we are promoting. If there is a product which is easily to buy with intent, so that means someone is just looking for tires and buying tires in Oklahoma, as example, so then that's definitely something that I would love to promote even more with Google because intent is much easier than push. Because when you're just promoting products with push, you're usually

Neil Twa (15:42.561) Yep.

Cem Atik (16:06.985) Yeah, disturbing people while scrolling through social media. And then you just need to, you just need to direct response to them. You just need to catch them and hook them. And that is usually much more effort than doing intent marketing when someone is actually looking for a product and want to buy it. Right. So if you just want to buy tires, you type in where I can buy tires in my, my, yeah, near my home as example, near my, near my city. Right. Yeah. And intent is much easier.

Neil Twa (16:11.341) Hmm.

Neil Twa (16:31.725) And there's an intent. Yeah. One of the reasons I like Amazon channel because it is a demand capture buyer intent. They're on their way in. We just need to get in front of them, which is what you're saying about Google traffic, right? They were on their way to some outcome and you just want to get in front of them while they're looking for tires in Oklahoma or whatever. Right. So that's a great channel. Is paid media one of the main reasons why you've been able to hit eight figures in sales?

Cem Atik (16:55.101) Actually, it's definitely one of the main reasons, but I think the most important reason are two different ones. So first of all, this for sure, the most thing that we just do or the most common thing that we do is we came in and figure out, yeah, what is costing us the product, yeah, until it reached the customer. And we optimize that process. So that means supply chain, product costs, fulfillment costs, logistic costs, all of these things is the first thing that we usually.

The same is that we just bring clarity and structure in the unit economics. And then comes paid. So paid is the third position.

Neil Twa (17:25.516) Yeah.

Neil Twa (17:31.549) Yeah, yeah, let's talk about that. Let's unpack unit economics before we keep going. For those who don't understand that terminology, maybe explain it to us.

Cem Atik (17:39.827) Yeah, sure. So unit economics is basically really simple to explain. So what is coming in and what is coming out is usually what most of the founders are knowing. Yeah. But if I just ask you as example, like, yeah, what is your customer acquisition costs? And you can, you cannot answer me within a few seconds. You have no idea about your business. Right. So, what is your customer acquisition costs? Yeah. What is the, what is your customer lifetime value within the year? How many times your usual customer repurchase just spend the, yeah.

buy another product and things like that. A lot of people are just always talking about ROAS, the return of ad spend. That is a metric which is relevant, but not really interesting for me. We are just looking more for POAs, profit on ad spend. So how much money I spend on how much profit I just earn each dollar I spend, as example, is something that is much more important. Because if you're just looking on the profit on your ad spend, you can figure out products which are maybe generating most of your profit, but you didn't even know because

Your winner is so much more dominant and aggressive in your product feed. But actually a much smaller product is doing like 20, 30, 50 % of your profits. And that's a really important thing. You just need to understand what I pay for my products, I pay for taxes, what I pay in returns, how many discounts I give. That's something that you just need to know. And on end of the, on the route is for sure the EBITDA.

how much profit I have before taxes. I mean, how many founders you met in your life and you said like, hey, I have you an idea about how much percentages you have at DA and they was able to give you an instant answer. I didn't even met like maybe two people in past.

Neil Twa (19:05.323) Mm-hmm. Right. Right.

Neil Twa (19:21.431) Yeah, it's one of the major things that we constantly beat into our people. Where is your product? Where is your details? Where is your customer acquisition? And in the Amazon world, where is your, not just your ACOS, but most importantly, your tacos, where is your conversion metrics? We want to know those things and we track them every week, every day through our processes to know our numbers. And that's what you're referring to, right? That is one of the major things you see with most founders missing.

Once they can grasp that concept of the business and understanding the money in and money out, they sort of get out of their way. And I think what you said earlier about the kind of businesses you're looking to acquire, those typically they're going to be in the one to two million in revenue a year are finding success in products on a particular channel. They don't necessarily understand their unit economics or even the business, but to get to that five million mark, that's one of the major things they're going to have to understand. Without being able to get to five million in revenue, without those it's just a

happenstance, it's less than 1 % of the people who are going to even run these companies. And to get to 5 to 10 million to 20 million, it is all about the numbers. And it isn't about the daily tactical stuff anymore. It isn't about what channels necessarily we're using for traffic or whatever, trying to discover an undiscovered traffic source. It literally gets down to, we know our numbers and how do we deploy capital? How much faster can I get a return on my capital and a profit on my advertising spend and then take higher risk and higher risk to do it?

Cem Atik (20:46.837) I mean, that's exactly the case. as better you attract your numbers and as more control you have over your numbers, as better decisions you can make. And there is no argument you can just push on me like, hey, this is not feeling well. I don't care about that. Because when your number saying like, this is good for my margin, this is good for my revenue, this is good for my overall customer acquisition cause, there is nothing that you can say to convince me that this could be maybe bad for us. So only if it's a really logical fact that makes sense.

like image damage or let us say something else. Maybe a short funny story. I talked last month with a founder. They are already doing 25 millions and he was talking and said like, we have a huge ROAS. are on eight. Yeah. We have an EBITDA about 30%. And I was like, you know, you don't have, and he said, how can you say that? Say, if you just have an EBITDA about 35 % in this area, I will call my investor, give you 10 million and buy your business now.

Neil Twa (21:43.767) Alright, that's a holy grail.

Cem Atik (21:45.469) And they was like, yeah. Like, like, because I was like, Hey, they was like, okay. Okay. Let us check the numbers. So I just lock in in their third party tracking attribution in their, in their unit economics tool. And I say like, okay, you have an a draw as on branded campaigns. And how about new customer acquisition? Yeah, we do it. So, and then we check the numbers. They pay like four times more for a new customer. Yeah. Then for.

Neil Twa (22:04.833) Yeah. Right.

Cem Atik (22:15.317) than for someone who's coming over to brand. And here's the thing, they already was overpaying for a branded customer. And we're saying like, yeah, you have a 8 ROAS on your scale, but guys, your search volume is basically dropping. Over the last year after year change, they lose 25 % in search volume. Saying like, you are burning out if you don't fix your customer acquisition cost on new customer level. And if you don't just check your metrics,

Neil Twa (22:22.203) yeah.

Neil Twa (22:33.773) Hmm.

Mm-hmm.

Cem Atik (22:44.694) Yeah, properly, you will do it. Yeah.

Neil Twa (22:46.613) That is always the fight, man. That's the daily weekly fight in every strategy we have at the tactical level. We're constantly dealing with new customer acquisition costs, trying to determine if we can get them to rebuy in the first 30 days on one channel or another, whether they spill over to the Amazon from a Shopify ad, if they're coming from TikTok, if we're trying to upsum them through email and SMS, are we getting them back in?

And that's a huge change in a recent business that we've been a part of. They had about a 2 % customer retention acquisition rebuy rate within the first 30 days. We now have it at 6%. So as we see that increasing, we're now seeing that, obviously, that LTV go out and they're consumable. So the type of products that they are. now we're tracking what their LTV is over three and six months. And we're now looking to adjust our ad spend because we're also seeing up to a 30 % lift on other channels from that.

Cem Atik (23:27.071) Thank you. Wow.

Neil Twa (23:45.111) front end customer acquisition costs. So that is something that's impact as well as you're lifting that up. Are you actually picking up those additional customers on other channels, even if they didn't buy from the original channel they touched? So we go out of just individual channel viewpoint and we look at all the channels as one channel of acquisition and how do we combine that?

Cem Atik (24:06.985) Yeah, I mean, it's pretty much the same. People still don't understand how important it is to treat your customer well. How many brands you know that do crowdsourcing so that they just take their customers and involve them to the product launch process? They say like, hey, we have free new flavors. Which one you choose? Vote. How many brands that you know do

Neil Twa (24:14.209) Yes.

Cem Atik (24:29.781) do this without seeing it somewhere else or like you told them this. How many people are doing events with their community? I didn't see much. But the brands that they do, they do 800, 900, a million in the last five years or something. And that's the difference. You just need to treat your customer like a football fan or like a soccer fan. So these guys need to love you and...

Neil Twa (24:30.902) Not many.

Neil Twa (24:44.833) Hmm.

Yeah. Yeah. It does.

Cem Atik (24:56.053) You just need to understand you and needs to feel a part of the brand. If someone can vote for a flavor and this flavor will choose it, then he choose this flavor, not you. And that's the difference between good brands and amazing brands. you just figure this out and just take your audience and involve them into your company and make them part of the process, you will always be.

Neil Twa (25:18.88) Yeah, dude, that's amazing. You've offered so much value and you didn't realize how we've been like at this for 25 minutes already. The conversation could just keep like rolling on. don't, there's no questions at the moment, which is okay. Like, let's just kind of put a final cap on it for now. Maybe we'll come back and do this again. It's been fun. You've unpacked a lot of stuff today. What's the last thing you kind of want leave with everybody today as we roll out?

Cem Atik (25:39.327) So what I would really recommend to everyone is just get control about your numbers. This is really first thing. Understand that the e-commerce brand is only growing if it's in an uncomfortable situation. If you're just staying in your comfort zone, you don't grow. Even if your numbers say that, you don't grow. And the last thing is don't care about your ROAS too much. Fuck ROAS. No one cares about ROAS.

Neil Twa (26:03.242) Yep. Your POAS. Because if you don't get your POAS right, you're going to be a POAS. Your POAS isn't going to have any money. man. I appreciate you coming on. Thanks for everybody for joining us live. Thank you, Sim, for coming on with me here, brother. I appreciate you.

Cem Atik (26:08.879) Exactly. exactly. I like that. like that.

Cem Atik (26:21.013) Thank you for being here. Yeah, was a lot of fun. hope we just repeat this.

Neil Twa (26:26.194) Absolutely, my friend. guys, thanks for joining us. Like, share, comment, engage, and remember, as we say at the end of every podcast, do something imperfectly and something perfect will happen along the way. Catch you guys on the next episode. Take care.

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