So many DTC brands think nice PR is more important than honesty. But that’s not us.
We're Nik & Moiz, and we're tired of all the hot air in our industry. This podcast is the behind-the-scenes conversation that gets to the heart of what DTC is really like.
Nik Sharma founded Sharma Brands, and Moiz Ali’s company Native was acquired by P&G for $100M. We have no reason not to call people out, and share our spicy takes. This is the conversation you won’t hear anywhere else, with two of the most experienced names in the industry.
We’ll be diving deep into industry moves, autopsies on failed brands, and why we’re investing in certain companies. Episodes drop every Wednesday. Make sure to subscribe wherever you get your podcasts.
How we're gonna do something cool. How do you, like, manage those client? Because, like, I don't know how many clients you guys have, but, you know, traditionally, an agents like, if I'm if I'm working with an agency I don't want my account rep to have more than 4 clients. You're not an account rep by any stretch of the imagination, but, like, how involved are you on any given brand? I I'd say I'm pretty involved in the strategy piece and seeing everything before it goes out. So I see all the final designs, all the final creative, and all the final media plans. I'm not in every single client meeting day to day because then I wouldn't have any time. Yeah. But I sit with the team every week, we go through, okay. From a strategy standpoint, you know, this client, they're coming up 3% short on their monthly goal. What are we doing in order to fix that? Are we gonna run a flash sale? Are we gonna do this? Are we gonna do that? You know, we've had with the with Facebook these last couple weeks, it's been a total shit show. And so a lot of my energy has been focused around how do we find the right people at Facebook that can actually get us answers and get these problems fixed? Yeah. Basically, it's like, you know, my, COO, now we have a COO, she pretty much dictates, like, where I spend my time. So every Monday, she'll tell me here's where here's what you need to do this week, and it's in Notion. And then my only job is to focus on that. It might be like three things or four things that need to get done. And then my entire focus is that. How do you manage the finances at your firm? Who's doing that? Is there a CFO? My mom is our CFO. Your mom is your So we have somebody who collects receivables. Be very careful about it. Oh, trust me. I have to make sure every charge is valid. Yeah. Is and so I'm sorry. So she's your CFO. She goes through all the charges. She goes through all the charges. She itemizes everything. She just she's doing all our taxes right now. Bless her heart. Yeah. You know, in Wolf of Wall Street, the CFO is the, like, Jordan Belford's father. Yeah. And then Jordan Belford's like, What was this $26,000 you spent last night? And the, you know, they're like, oh, We had to take, the, Pfizer out to dinner, and they ordered all the sa like, the we went to the steak house and they
It seems to be winning. Yeah. Okay. Great. Okay. On-site opt in, we've already covered. Grow your list faster with that. Also, people use fun do to grow their list faster. They use cash back incentives instead of coupon incentives because they're higher margin. And so they can offer a bigger cash back incentive. They can say, 20% back instead of 10% off? Yes. They still save more money than the 10% off. It only ends up costing them like 4% net. And they pick up way more subscribers that way with the bigger incentive. Okay. And tell me how that works, though. Like, so it's, it's like, instead of getting a 10% off coupon right now, it's 20% off of your next order or, like, 20% off of, 20% cashback on this order so I can use it on order. 20% cashback on this order. Yeah. The return window passes 30 days later. You get an email as the consumer that says click here to redeem your cashback. You get to choose as the consumer, whether to take it as a gift card for that brand Yeah. Or actually a VIS a digital Visa card. Like true cash back. So here's how this works. About 50% of consumers don't redeem. Of those who redeem it split between those who take a gift card for your site, which in that case, you got the first purchase at full price and it they're only gonna credit if they do a second or third purchase later on. Yeah. Yeah. Yeah. Way higher margin. And then if they do the actual cash back, then, yes, they're getting the cash back. But it's still like 25% of people that have done it and you've had the full amount of the purchase price for a month for working capital purposes. Yeah. In general, it's like meaningfully higher margin. Am I required to offer a digital visa coupon or a coupon to my website, or can I just say it'll only work can be a coupon to my website? You're required to do both, but you can further incentivize the store credit by saying you get 1.5 x, the value, 1.7x. Yeah. Okay. Like, true classic is a huge adapter of this. Yeah. And that's they do. They incentivize the store credit piece. Okay. Gotcha. Okay. That's really interesting. And so, basically, this is a pop like, the pop up would say incentive
You reach behind your seat or the seat in front of you rather and you pick up a magazine called Sky Mall. And you basically look through Sky Mall, and that is essentially what the catalog ads are. It's just a massive catalog, and you've got all these ads in between for different products that people can double click into. And see, you know, you go directly to the product page, but, catalog ads are essentially the opposite of UGC. They're ads that fully look like ads And, I'll get to it in a minute as to why, but this is the reason why they work so well. They're kind of like that Amazon section that says you might also like but, these are strictly ads. It is also the former version of ASC and DABA, which stands for dynamic audience, broad targeting, if you were on Facebook, you know, probably 5, 6, 7 years ago. But Meta's heavily heavily investing into ASC. And, based on all of that data that they have as well as the data that I'll share from this Veros report. It looks like catalog ads are working really well. So before we get into this, I just wanna quickly address who DPA, which stands for dynamic product ads, aka catalog ads, who they're great for, And I'm curious what you think, but I think they're great for apparel brands, beauty brands, basically any sort of ecommerce brand that has tons of skews, but also great for marketplaces, places like StubHub, travel sites, Go puff, etcetera. Anything you'd add to that? Yeah. I think it's great for anyone who has a big cat. Like, I think you're right about all of those, and that's probably what comes to my mind at first as well, which is, companies that have a huge catalog. So think Thrive market, think true class. Like, you know, anybody who's got, you know, the if you're selling 1, if you're athletic greens, probably not a good use, although I could be wrong. If you're a Thrive Market makes a ton of sense. And, you know, as I as I remember in, like, a decade ago or, you know, 5 years ago, the reason that everyone used these was because you could retarget exactly what the person looked at. So you could be like, okay. You looked at you know, this pair of joggers, you looked at this shirt, you looked at these shoes in this color. We're gonna retarget you with
Work at all on the PDP, which was surprising. They worked really well via emails to get people to buy because people would be like, this is like, you know, thirty two year old woman with her newborn son like. Yeah. Nobody's this is obviously not a paid review, and that was really effective via email, but not on the PDP. That said, I think you're absolutely right. Social proof everywhere all over your website is the best. And I think the other thing with social proof is, a lot of people will put quotes on their site but they don't put quotes that directly correlate to benefits that they know will work. Yeah. So for example, if it's native, native definitely does this right, but like it, for example, it previously said, you know, I love the way that the packaging comes. It's so easy and it arrives on time. Or, you know, it ships and it arrives on time. I've never had issues with delivery. Gonna be as strong as I used to sweat every day through my natural deodorant, but this formulation has completely gotten rid of that. Or This formulation absorbs everything. Yeah. You know, like, that type of social proof is 10 times stronger than any regular reviews. Yes. Yes. The next one is, making sure that your risk reversals are obvious. Most brands have this. Google Shopping actually requires it to be a part of Google Shopping, which is, you know, some sort of a refund policy, 30 day satisfaction guarantee, you know, no hassle returns, orders over 50. Magic Spoon has this thing called a happiness guarantee. Most people have this, but it's lives in a tiny little drawer in the FAQ. They don't display it. On the PDP or I like displaying it right underneath the add to cart button. It's like, right as you're about to make this big decision, let me just reassure you one more time. Yeah. You know who does a really good job of this is Harry's, like, as you're checking out on their checkout page and their, cart page, they'll be like, you know, no hassle returns. Yeah. That shipping comes from the United States, all this stuff to get you to purchase. I'm not sure if they still did it. They did it a long time ago, and it was super effective. I, like, love those icons that they put in. Like, you know, there are, like, very easy returns. All this right now, they still do quality guarantee. If you don't love your Harry's order, it's on us. Yeah. It's also one that I love a lot
A little bit. Tell me what those updates were though. So the main updates that I thought were interesting. 1 was combined product listings. So, you know, you just have, bigger parents skew. You know, think if you have body wash and you have different sizes and you have different scents, that's all basically under body wash versus the different scent of body wash. Subscriptions are now natively integrated. Single page checkout is the new standard Shopify checkout is now available to be used in a mobile app, which I thought is interesting. Shop Pay also now works anywhere. So it's live on Everlane site, which is not a Shopify site. And then you can now sync reviews from your site, you know, using Okendo into your shop, into the shop app. You can, sync reviews. Those were the main updates, but honestly with this email, I feel like it caught people off guard. Like, I don't think anybody was expecting this. There was no sort of messaging or communication of, hey. You know, we're updating our systems to do X and, therefore, we need to charge more. Like, there really wasn't any justification for the email. It just kinda came out of nowhere. And I think a lot of people too were, like, I remember seeing it on Twitter because people were just like, wait, is this real? This just came out of nowhere. I had several thoughts. One was I thought that this might mean they were gonna like misearnings because it came out right around the time that they were releasing earnings. And usually when you announce like layoffs or an increase in prices or something, right around the time that you're announcing earnings, you're like, you're gonna have a little bit of trouble with your stock. And so, like, an increase in prices is gonna make it go, like, you know, like, sort of buffer the fall. Here, was a fall anyway. I I don't think I think Shopify beat earnings, like, what what the street expected, but the stock is still down 11% over the past 5 days, which a lot. Like, you know, we're talking about $10,000,000,000 off their market cap wiped out. So that was a little bit surprising to me. The second word that was surprising was us, why are you doing the same pricing for a 3 year contract? The reason that a Shopify Plus store is gonna get off of
