This week, I'm diving into some of the burning questions that have been filling up my DMs lately. Since starting Cobble Hill and launching my podcast The Marketing Factor, I've had the privilege of connecting with a bunch of different businesses, each facing their own unique marketing challenges.
What excites me most about this industry is its constant evolution - every day brings new challenges, every client presents a unique puzzle to solve, and every solution requires a fresh approach. In our latest episode, I took a solo deep dive into some of the most common questions I've been receiving. Now, I'm breaking down those insights here for you, covering everything from seismic shifts in the industry to practical advice on building your marketing team.
If you’re interested in watching the full episode rather than reading the spark-notes, check out the link here:
Let's dive in.
A: We started Cobble Hill 13 years ago, and the industry and landscape of marketing and businesses, in general, have changed pretty dramatically. Over the past five years, and especially since COVID, we've seen everyone kind of flood the space of digital marketing and email marketing. Now every brand, especially direct-to-consumer brands, are running ads. So it's much more competitive to run ads on Facebook and Google and TikTok and Pinterest and all the platforms that we run ads on.
I think that the biggest shift that is going to happen over the next five years or even over the next year is that the onus of the actual advertising and storytelling aspect comes back to the essence of what the brand is about. Uniqueness in a brand is probably the key factor that will help your advertising stand out in this crowded market.
A: That's a question I get asked a lot, and I don't necessarily have a great answer for it. There are a variety of different factors. Of course, a lot of people have budget constraints, so they can only spend a certain amount of money. They also don't know what their return on ad spend is even going to be if they've never run ads before.
For brands that are just starting out, I say to invest their money in other places like PR, a really good PR agency, influencer content, working with other brands, or even just running the ads themselves in the background to have a way to monitor and see how things are going before they invest anything with an agency.
For a brand that's already spending a little bit of money and they've seen return on investment, we say that, okay, let's try to determine what your margin is going to be and try to capitalize on spending as much money to acquire new customers as we possibly can. So for them, if they're spending $10,000 a month and they're generating a 300% return on that, where are there opportunities to scale that budget?
A: I think for a healthy business, we see that your ad spend as a percentage of your total revenue is somewhere between 5% and 20%. At Cobble Hill, we first determine your marketing efficiency ratio - what you're spending on advertising, service fees, everything like that as a percentage of your total gross revenue.
At 5%, you're pretty healthy, but you also have room to grow. At 20%, you're at a high growth phase, but you're also paying a lot to acquire customers. It depends on your product margins. If you have slim margins, paying 20% of your total gross probably isn't profitable. But if you're a high-margin business with high customer return rates and lifetime value, you should be more willing to spend to acquire customers.
A: We generally think that if you have a 20,000 person email list, that's still pretty low from a direct consumer standpoint, but it's growing. We think that you can be sending, as long as you're segmenting your subscribers, at least one to two a week with maybe one to three SMS messages a month. Right now, I feel like that's the appropriate amount.
As we get closer to Black Friday, Cyber Monday, the cadence of emails really kind of ramps up. We generally recommend sending up to three emails a week or more starting as early as September, October, getting people excited for the sale of Black Friday, Cyber Monday sale, or you're prepping VIP people for discounts that they might receive even before that sale.
A: I think that goes back to your content strategy. Let's say you're a cake business. You sell cakes online. There's definitely a seasonality there, right? There's kind of some key buying moments, holidays, birthdays. That's kind of when people are thinking about buying cakes. So what can you do outside of those key moments to make it interesting to a general customer?
We think a lot about, OK, how are these cakes made? What's the founder's story here? Let's get into the heritage of the brand if there's a heritage piece. Let's get into maybe even some pop culture references. What can we do to tie in, you know, let's say Taylor Swift was eating a cake. What can we do to tie that into the ads or the email marketing piece that might be like culturally relevant?
A: It's very competitive right now to run ads. But I think that as long as you have the right marketing mix, you can be successful. To me, that mix includes having really great PR and great content. When we talk about content, we're referring to things like video, people talking about the brand, user-generated content (UGC) - essentially any video content that we can use to promote the brand.
If you have those components in place and you have a healthy online store already or a healthy hotel already that's doing great, but you're just looking for more bookings, I think ads are the natural next step to start running for your business.
A: For us, it's still Meta and Google. Those generally tend to be the ones that convert the highest in terms of return on ad spend. It's usually where we recommend that people place their biggest investment. But we've also seen that TikTok can really build up brand awareness. We don't see a lot of purchases coming directly from TikTok, even for the brands that we've run who have huge TikTok followings already. But we see that the awareness piece that that drives bleeds into everything else.
A: I think that for us, when we look at successful small businesses, we see that they have a very involved founder who has hired a very smart jack of all trades operations person who has a very strong fundamental marketing sense. They aren't necessarily the marketing director, but they understand finance. They understand social. They understand e-commerce and they can tie all of these things together.
Once you get that, then you can kind of develop the team around it. I think it's always important to find smart young people, they don't need to have a ton of experience, but they need to know social. We always talk about at Cobble Hill, people who get it, and people who don't. There's this is kind of one of our principles for how we decide to hire people is, does that person get it? And you either get it or you don't.
And there you have it – a deep dive into some of the most pressing marketing questions I've been receiving lately. I hope you've found these insights valuable, whether you're just starting out or looking to refine your existing strategies.
Creating this podcast has been an incredible journey, and I'm truly grateful for all the feedback and connections it's fostered. It's been exciting to reconnect with old acquaintances and meet new faces in the industry. That's really at the heart of why I started The Marketing Factor – to spark conversations, share knowledge, and build a community of passionate marketers and entrepreneurs.
Remember, the world of marketing is always evolving, and there's always more to learn. So keep those questions coming, and don't hesitate to reach out if you want to dive deeper into any of these topics.