Tuesday, April 9

🗣 Running a B2B and want to reach 33,441 DTC Brands? Start here…

WHAT’S HOT ON SOCIAL MEDIA

If you ask yourself this question, and legit have USPs and compelling reasons on why they would choose you instead of your competitors, you’re on the right track.

This should be your step 1 before you’d even think about building your product.

If a product you’re looking to build already exists, and you’re not going to be better than them in terms of product, experience, etc., you’ll just be a part of the noise 🤡

INVOICE FALCON
#2 - Running a Store on Shopify and Need Professional Invoices?

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•  Order Print & Send Invoices in Bulk.
  

•  Automatically Detect & Send Invoice based on Customer's Language.
  

•  Track & Manage Payments for Invoices.
  

• Multi Currency Support.
  

• Set up a Professional Invoice in a few clicks (Onboarding Service Available).
  

• Tax Compliant Invoices.

SUCCESS STORY
#3 - How Blu Atlas Founder Deep Patel Built a Successful DTC Skincare Brand

The Rundown: In just over 2 years, Deep Patel took Blu Atlas from startup to a profitable 8-figure exit. His recipe? Hands-on leadership, customer-loved products, and creative, cost-effective marketing.

The Customer Connection: From day one, Patel focused on delighting customers with great products. Investing his own money kept him laser-focused on profitability. Customers showed their love by coming back for more.

Patel's Playbook for DTC Wins:

1. Hire a small but mighty team of A-players

2. Partner closely with suppliers who are bought into your vision

3. Get scrappy with marketing - think beyond just Facebook & Google ads

4. Play to your strengths and know when to pass the baton

5. Cultivate relationships far and wide - they're the gift that keeps on giving

Keep Tabs On:

• Repeat purchase rates - are customers hooked?

• ROI on creative marketing campaigns & collabs

• Unit economics - CAC, margins, etc.

What's Next: The future looks bright for focused, customer-obsessed DTC brands that grow fast and profitably. More will likely opt to exit vs taking the VC rocket ride.

➡️ You can read the article here...

DTC Daily’s Monthly Spotlight:

Upcoming Events:

June 11-13: CommerceNext Growth Show in New York City.

Need a Graphic Designer? Cost effective solution, instead of full-time employee: Delesign 

🗣 Have an upcoming event or tools you’d like to recommend to 33,441 DTC Brands? Click Here

IBRAHIM’S NUGGETS

Arguably, the Most Important Aspect of Your Business…

Yesterday, we spoke about about copywriting a little bit, but today, let’s talk a bit about the most important aspect of your business

”Now whaaaat is that, Ibrahim?”

I think we can all agree—it has to be your unit economics and the numbers. I cannot remember the amount of times I’ve consulted Founders and realizing they had no such excel/google sheets of their unit economics breakdown. It’s usually the case with the first time Founders.

Whether you’re a Founder, Growth Analyst, or a Media Buyer, while you don’t have to be as good as your CFO or CA when it comes to numbers, it’s essential to know some fundamentals, such as the breakdown of unit economics, and plan your media spend accordingly.

Imagine this:

• You sell product A for $50
  

• Your cost of goods sold (COGS) is $5
  

• Your landed cost is $8 (COGS + custom + shipping to warehouse + insurance, etc.)
  

• Your transaction (payment processor) fees is $1.75
  

• Your pick and pack is $2.5
  

• Your shipping & fulfillment cost after deducting what the customer paid for shipping is $1.5 (if the shipping cost is $8, and assuming customer paid $6.5, we’re only taking into account what your expense will be, which is $1.5)
  

• Your return rate is 3%, so that would be $1.5
  

• Your total cost of delivery in this case would be $15.25, which would leave you with $34.75, accounting to 69.5% gross margin. I also like to call it Fuel Profit (inspired by Taylor, CTC) because this is the margin you get to play around with
  

• You’re left with $34.75, and your target for net profit is $10 for each unit sold
  

• That leaves us with $24.75 to spend on acquiring a customer, where the ROAS target should be at least 2.02

Now how does having a break down such as this help you?

• Firstly, if you’re spending on marketing or any related spend, you have a clear picture of the breakdown
  

• You know if you’re profitable or not on the first sale of a SKU
  

• You know which SKU has the highest margin, so you could try promoting that more often. This also gives you more margins to acquire a new customer, who might eventually buy other products as well
  

• Cost Caps: When you have cost caps on Cost Per Acquisition (CPA) or on Return On Ad Spend (ROAS) target, and you’re running an ad for product A, you now know exactly how much you’re willing to spend, which in this case is $24.75, or a ROAS target of 2.02
  

  Note: if your cost caps are too low, Meta might choose not to spend at all if it isn’t confident about acquiring a customer at that CPA/ROAS cap
  

• This also tells you what’s the maximum you could spend to break even, which in this case would be $34.75

If you don’t know these numbers yet, consider this as your calling. And don’t worry about manually building all this and hitting your head with the formulas because I’ve already gone through all that. Access the unit economics calculator here, and then go to file > Make a copy, and you’re good to go!

Please note:

• You can duplicate this for all the SKUs, and understand the breakdown for each of them.
  

• Whatever has the highest margins, you can try promoting that more aggressively, as long as it gives you a good ROI. But at least have you'll have higher margins to play with if you’re promoting products with higher margins.
  

• If the product with higher margins isn’t your best seller and is hard to sell, where the CAC shoots to a point where it isn’t profitable, you might want to try with your best sellers instead. It’s about finding that sweet spot.

• All the numbers used above are just for example. Please do your own numbers.
  

• This template is meant to serve as a reference for a starting point. You'll be responsible to ensure all the numbers are right, and change the template however you’d like, that serves you the best.

Hope that was useful. If you have any questions, you can ask by clicking here.

If you have any feedback, or would want to suggest any topics you’d like me to talk about or dive deep into, you can use the same form.

Good luck!

RESOURCES
#4 - Things Worth Checking Out

Hook Logistics + Diamond Hook SHORT FORM - Need a one-stop shop for your eCommerce needs? Diamond Hook handles web, brand and growth, and their sister company Hook Logistics handles sourcing and fulfillment. Book a call with DH or HL today!

TRENDS - 5 trends in online purchasing habits you need to know about

NEWS - Toms creates ecommerce hub for socially conscious shoppers

MARKETING - What big brands can learn from mom & pop shops to connect with their customers

SALES - Bridging DTC and wholesale to boost your brand’s sales

Have any questions that you need help with?

Ask here - and look out for Fridays Issue where Ibrahim will answer them.