Chris Rawlings is the Founder and CEO of Sophie Society, an Amazon PPC expert, entrepreneur, and 7-figure seller who has helped brands navigate the complexities of Amazon advertising and scale their businesses. He’s also known for bringing a scientific, experimentation-first approach to PPC rather than simply following conventional Amazon advice.

> Here’s a glimpse of what you would learn….

In this episode of the Ecomm Breakthrough podcast, Chris Rawlings from Sophie Society shares his entrepreneurial journey, from a custom wedding invitation business to building a multi-channel e-commerce brand portfolio. He highlights the critical difference between true brand building and private label arbitrage, emphasizing the importance of customer lifetime value, strategic offer design, and compounding customer growth. Chris advocates for leveraging Amazon, TikTok Shop, and Shopify together to maximize reach and profitability, while stressing that direct customer engagement and foundational work remain essential for sustainable, long-term success.

Here are the a few action items that Josh identified from this episode:

Timestamps:

00:00:00 The Problem with Private Label Arbitrage
Many Amazon sellers think they have a brand but are just doing arbitrage without compounding customer growth, facing margin compression.

00:00:55 Introduction to the Episode
An overview of the episode’s key topics, including building a real brand, increasing customer value, and avoiding entrepreneurial mistakes.

00:01:52 The Entrepreneurial Beginning
Chris Rawlings shares how he and his wife started a custom wedding invitation business after graduating from college.

00:04:10 Scaling the First Business
The wedding invitation business grew to a six-figure income with a six-month waitlist, but it wasn’t scalable.

00:04:53 Pivoting to Amazon
They transitioned from custom invitations to selling physical products like recipe cards on Amazon, hitting $1 million in their first year.

00:06:43 Surviving the Pandemic
When COVID-19 hit, their party supply business dropped 90%, forcing them to innovate with educational posters for kids at home.

00:08:18 The Power of an Unscalable Process
The host compares Chris’s journey to Alex Hormozi’s, highlighting the value of starting with an intimate, unscalable customer experience.

00:10:02 Choosing the Right Business Vehicle
Chris discusses how the market you enter determines your potential scale and his goal of building a billion-dollar brand portfolio.

00:16:20 The Importance of Talking to Customers
The host shares an experience from 500 Startups, emphasizing that founders must talk directly to customers to find true insights.

00:18:48 The Customer Journey Mistake
Chris explains that many Amazon sellers fail because they don’t understand the customer journey or focus on compounding customer growth.

00:22:02 A Framework for Understanding Customers
Chris recommends using TikTok Shop to understand customer pain points and hooks, which can then inform Shopify and ad strategies.

00:25:48 The Unsexy Work Unlocks Growth
The discussion centers on how fundamental, “unsexy” strategies like understanding customer LTV and creating strong offers are key to scaling.

00:28:49 Applying Service-Based Models to E-commerce
Chris explains how he’s applying principles from service industries to physical products by testing various offers and upsells on Shopify.

00:31:41 Knowing Your Numbers is Key
The host shares how understanding their own business’s LTV and acquisition costs allowed them to scale their agency aggressively.

00:34:38 The Power of a Great Offer
The conversation shifts to how a compelling offer is more important than ad creative for acquiring customers profitably.

00:37:51 Building a Business with Integrity
Chris shares his philosophy of building a sustainable business that could be passed down, focusing on providing real value.

00:39:42 The Long Game of Business
Unlike athletes, entrepreneurs can peak late in life, allowing time to compound lessons and master all aspects of business.

00:44:07 The Danger of Chasing Shiny Objects
Chris warns entrepreneurs against constantly jumping to new business ideas, emphasizing the power of compounding lessons in one vehicle.

00:48:42 Final Thoughts on Life and Business
Chris reflects on his long-term goals, faith, and how business serves as a tool for personal growth and service.

Resources mentioned in this episode:

Tools and Websites
“Amazon“: “00:00:00”
“TikTok Shop“: “00:23:24”
“Shopify“: “00:21:49”
“500 Startups“: “00:17:17”
“Sophie Society“: “00:15:27″Books
“$100 Million Offers by Alex Hormozi“: “00:35:48”
“Money Models by Alex Hormozi“: “00:35:48″Videos
“YouTube Videos on Graphic Design (self-taught)”: “00:02:12″Notable Mentions
“Alex Hormozi“: “00:09:54”, “00:35:48”
“Grüns (company that exited for $1 billion)”: “00:11:59”

This episode is brought to you by eComm Breakthrough Consulting where I help seven-figure e-commerce owners grow to eight figures.

I started my business in 2015 and grew it to an eight-figure brand in seven years.

I made mistakes along the way that made the path to eight figures longer. At times I doubted whether our business could even survive and become a real brand. I wish I would have had a guide to help me grow faster and avoid the stumbling blocks.

If you’ve hit a plateau and want to know the next steps to take your business to the next level, then email me at josh@ecommbreakthrough.com and in your subject line say “strategy audit” for the chance to win a $10,000 comprehensive business strategy audit at no cost!

Transcript:

Josh Hadley 00:00:00  So many brands are facing margin compression right now on Amazon. Yeah. Because at the end of the day, you might have a trademark. You might have a website with your brand name on it. You might have a plus content, but guess what? That doesn’t mean you have a brand. Totally. And so there’s a lot of I call them private label arbitrage sellers because there’s the arbitrage model on Amazon and everybody’s like, oh, that’s a that’s a stupid like business model where you’re going in and flipping stuff. It’s like you’re doing the exact same thing, right? Yeah. You just think you have a brand, but you don’t actually have a brand because you’re not compounding growth. And so and but I would also say there’s $100 million brands out there that are following this like private label kind of acquisition playbook. And it’s fine. You can make money, but there will be a day of reckoning where like the model just no longer works.

Intro 00:00:55  Welcome to the Ecomm Breakthrough podcast. Are you ready to unlock the full potential and growth in your business? You’ve already crossed seven figures in sales, but the challenge is knowing how to take your business to the next level.

Josh Hadley 00:01:09  This is a.

Chris Rawlings 00:01:09  Conversation I had with Chris Rawlings from Sophie Society. In this conversation, we get into something deeper why? Some businesses compound for decades while others eventually hit a wall. We’re going to talk about the difference between building a real brand versus just doing private label arbitrage. Why your offer may matter more than your ad creative and how to increase your customer value, and why. Constantly jumping from one next business opportunity to another can be one of the most expensive mistakes an entrepreneur can make. This is a wide ranging conversation, but there are a lot of lessons here for anyone that is trying to build a company that lasts.

Outro 00:01:52  You want to start with the story then?

Josh Hadley 00:01:53  Yeah. Let’s start with the story.

Outro 00:01:54  Just how you got here. Yeah. Yeah, yeah. Helping other businesses, growing your own business and all that?

Josh Hadley 00:02:01  Yeah, 100%. So my wife and I, we both graduated college at the same time. So 20th March, May 24th, 2014. And we graduated from the University of Utah.

Josh Hadley 00:02:12  She graduated in early childhood education. I graduated with my MBA, and I got a job offer with American Airlines as part of their MBA leadership development program. So that brought us from Utah down to Dallas, Texas. And as soon as we got there, my wife was like, hey, should I be looking for a job or not? Like, I’ve always loved graphic design and art and things like that. But she studied early childhood education and I was like, you don’t have to go work for a preschool or school system yet. Like, go explore because we don’t have any kids. Like got a good paying job right now. Go do your thing. So she studied, like graphic design by herself. And so she was like, kind of like self-taught. Watch a bunch of YouTube videos, etc.. And then she had some friends that were getting married. She was like, hey, can I design your wedding invitations for free? And so she designed them for free. Then one of the friends was just like, this is absolutely incredible.

Josh Hadley 00:03:04  Like, I have to pay you for this. And then she went out and, like, referred a bunch of her friends. And so me being the business guy was like, that’s a business. And so I’m still working at American Airlines, but we started a custom wedding invitation business. And so while we did that, I was just still working at American Airlines. I basically ran the entire, like, sales process. So we created a I joined a bunch of like thousands of, like, women or it was like, brides to be Oklahoma City, brides to be LA County. Like all of that. Like joining thousands of these, like, kind of like wedding Facebook groups. And then I was posting under her account like, hey, does anybody need wedding invitations? I’m new to this game. Be happy to design your invitations. Then I would have them, like, click on a link, fill out a form, and then it was just like a whole sales process. Then I had like scripts that I would just like, DM them like, tell me about your budget, tell me what you’re looking for.

Josh Hadley 00:04:01  And then I would get them to like put down 50% deposit up front. I’d get them on my wife’s calendar. And so like that was the playbook we ran for literally two years.

Outro 00:04:10  So you basically took all the sales knowledge that you had from American Airlines. You applied it to this business with your wife. Yeah. And scaled that.

Josh Hadley 00:04:18  And so we scaled that. I mean, we did for six figures, you know, our first year. And it was like, oh, this is really cool. Like nice. I started to like make more than what we were making at American Airlines pretty darn quick. But the challenge was like, I got her to a point where it was like a six month waitlist just to work with my wife. Damn. And, okay, I was like.

Outro 00:04:36  All right, next challenge.

Josh Hadley 00:04:37  The only.

Outro 00:04:37  Problem.

Josh Hadley 00:04:38  We could do is either go replicate her, find more designers, or, like, do something different. Because we also had our first child at that time, I was like, all right, this is not sustainable for her to keep, like burning both ends of the candle all day and night.

Outro 00:04:53  Yeah.

Josh Hadley 00:04:53  And that’s where, like, Amazon was still hot at that time, right? Like we’re talking 2016. So watched a bunch of courses and stuff like that. And it like finally dawned on me, like one of the random products that, like, these brides always like, wanted or asked for extra things later on after they’d get their invitations was like recipe cards for their bridal shower, and they would always come back, hey, can you design some? And I was like. Is the exact same process to design a recipe card as it is, like a wedding invitation.

Outro 00:05:22  But yeah.

Josh Hadley 00:05:22  You ain’t spent in $2,000 for your recipe card design, I know that. Yeah, so it was like, so it was that problem that then led to hey, but what about that Amazon thing? What if we designed a set number of like just recipe card designs and then put them on Amazon. So we did three designs and I was like, all right, we got 200 units. I was like, oh, that’s a big bet at the time.

Josh Hadley 00:05:43  We like shipped in 200 units to FBA and like sold out in like just like a month or two. I was like, hold on. I was like, that’s a lot better of a system.

Outro 00:05:52  Yeah.

Josh Hadley 00:05:52  So then I was just like, all right. Click the reorder button from the manufacturer. Get them back in. And I was like, okay, I see this thing working. So that was the fall of 2016. Then 2017 we went all in on Amazon. So I stopped like we still had that six month wait list that we had to work through. But I stopped like selling anybody else and was just finding new product opportunities on Amazon. So our first full year on Amazon, we did over $1 million and we just kept like going down that Amazon rabbit hole of stationery. and we kept doing that for a while till 2019. That’s when I quit my job. So I was moonlighting at American Airlines, like the entire time as we scaled up the business, which allowed us to, like, fund the aggressive growth that we were on.

Outro 00:06:38  Yeah. Growth is expensive.

Josh Hadley 00:06:40  Yeah. Putting it all back into inventory. Right?

Outro 00:06:42  Yep.

Josh Hadley 00:06:43  And so 2019, I left American Airlines and I had kind of like held on to American Airlines being like, well, if there’s ever a recession, at least this is a big corporate like job, I would be good, right? Well, leave 2019. Sure enough, like COVID’s just around the corner and we were doing like a lot of party supplies, right, for weddings and whatnot. So I guess what happens in Covid, like the business drops 90% overnight.

Outro 00:07:07  There’s no parties, no parties.

Josh Hadley 00:07:09  And I was like, oh my gosh, like number one, I left the job that I was the, you know, cushion, so to speak.

Outro 00:07:16  Yeah.

Josh Hadley 00:07:17  I was like, I don’t know what else to do because I don’t know when parties are coming back and all of that. So while everybody else in the e-com space were like, I’ve never seen better days. Like they’re running out of inventory and like, containers are a problem because the prices are so high.

Josh Hadley 00:07:31  We had the exact opposite problem, but it led to the next kind of like innovation, which was like we created educational posters because our son was doing preschool at home then at that point. So my wife designed some educational posters. We posted those super competitive category on Amazon, but it was kind of like our Hail Mary. I was like, well, nothing else is working. We’re up against people that have 5000 plus reviews. And I was like, yeah, whatever. We’ll see. But we became the number two seller in just 30 days. And I was like, okay, why is just the design like my wife’s design? Just it’s different than the cheap Chinese crap. Everything was just the cheap Chinese crap on the.

Outro 00:08:12  Market, and.

Josh Hadley 00:08:13  That’s what made all the difference. So then that sent our business to a whole nother trajectory.

Outro 00:08:18  Dude, honestly, the, the path that you just explained to me is so familiar to me because, I feel like there’s two ways that people like, in our space or in online entrepreneurship get into this.

Outro 00:08:32  Either they kind of used marketing hacks to just sell a lot of something trending, or just kind of white labeling something, and they focused all on the marketing, all on the marketing acts, or they come at it from the exact opposite side of the business. And your story actually reminded me a lot of Alex Hormozi, because Alex started by custom going into every gym himself, he would actually fly to the gym and get their sales running as his service, and he learned through that unsaleable process. Just like your guys custom wedding invitation, you know, invites thing how to make it great and but it was not scalable. Right. So it’s like the opposite opposite vector. But that vector is so much more powerful because then you learn through your intimate custom white glove experiences with the customer what actually matters to them. And then you have the experience of, okay, now we know what greatness looks like for delivery. How do we scale it? And that’s exactly what you did for Alex. That was he would basically sell them the system and the coaching to help them implement it themselves, which is infinitely scalable, right? That’s a model that we all know.

Outro 00:09:54  Yeah. And for you, it was selling physical products that you could, you know, manufacture an infinite amount of. So I think you came at it from the right direction.

Josh Hadley 00:10:02  Yeah. So and I think that for us, like what I’ve learned too, is the type of vehicle you choose to enter into is also going to set like how high you can scale, right. And I think that originally I was like, what would it be like to have $1 million business? And then you hit that and then you’re like, was a $10 million business look like, right? And now we’re on the path like, okay, what is $100 million business look like?

Outro 00:10:26  Dude, I love that.

Josh Hadley 00:10:28  you know, and so that’s where we that’s where we want to go. But here’s, here’s the key takeaway is you’re also limited by the vehicle you choose to enter into. And the market determines that. Alex talks about this a lot where there’s a lot of like. Right now, kind of like the med spa or like the biggest thing right now, you can have a really bad operator enter into a really big Tam opportunity that’s that has explosive growth behind it, and they can create a $100 million business even without being a good operator, just because there’s so much demand in it.

Outro 00:11:04  Yes, absolutely.

Josh Hadley 00:11:04  So a big component for me is, you know, each of these levels, like, I think we were like we were king of the party supply space for a moment. And I was like, but I wasn’t reaching like, we weren’t $100 million business yet, but like, we owned Amazon for the most part in our space. Same thing with kind of like the classroom supplies and you get you hit your market limit and then you’re like, what’s next?

Outro 00:11:28  Yeah.

Josh Hadley 00:11:28  And for me, as I look at what does it look like to become a $100 million brand, what does it look like to become $1 billion brand? That’s where you have to look at like, massive Tam Yeah. And you have to hit growth trajectories. So why does Grüns exit for $1 billion? Well supplements is obviously a reoccurring business. So you’ve got customers that will compound. On top of that you also have like gummies or like the form factor that has explosive growth, for any type of supplement right now.

Josh Hadley 00:11:59  So they, they rode those coattails. Yeah. Not to say that they weren’t good operators. They were probably good operators. I mean, they reverse engineered the whole billion dollar exit. Yeah, but they rode on the coattails of growth. And so for me, that’s probably been my biggest takeaway over the past decade, is sometimes entrepreneurs make it a lot harder on themselves by choosing a passion project or just randomly stumbling into a product. And that’s what I think, like my journey is, I randomly stumbled into party supplies. I randomly stumbled into educational stuff, and the next part of my career is like, no, we’re going to look at like where? Where’s the puck moving? What vehicle do we actually want to enter into? And then let’s go build and scale the team so that we can. My my vision is like $1 billion portfolio.

Outro 00:12:48  Wow dude I love hearing that. That’s so great.

Josh Hadley 00:12:51  So that’s that’s it.

Outro 00:12:53  Fuck yeah. Yeah. That’s that’s really true. And I think, I’ve, I’m probably still learning that lesson, but, the vehicle matters.

Outro 00:13:05  Like you, I know a lot of smart entrepreneurs, and maybe I’m one of them who’s not in a vehicle that is, like, worthy of their efforts, you know? And I have a friend like this who she’s, like, so smart, so driven, so determined, so has such a deep ability to, like, manifest reality and create things. But she’s in a business model that’s just like, first of all, brutal in so many ways. It’s like contracting and also just doesn’t have the payoff. So if you’re spending all of your mental energy on that, it’s it’s like what would happen if you spent all of that energy on something that actually was scalable, that had a good Tam, that was riding the coattails of something that matters right now in the zeitgeist. You know, like you mentioned, with the supplements and the gummies and, and focused all those efforts on that. It’s like a whole different ball game when you start doing that. And I think, like, I, I have accidentally done this in my life, like in my first brand, I was in like a really big tam.

Outro 00:14:15  And I actually got lucky because I was in spinal health products and a bunch of the, the brands that were in my space got sued all at once right when I launched. So I almost like, didn’t even know what was happening. Like, interesting. I just came on, launched, and I actually didn’t follow the kind of principle that we talked about initially of like starting with a really great product. I was really like launching stuff as fast as I could. It works. Yeah, yeah, because it was it was all working and but it was a lot of luck that was causing that. So then I actually had to get my teeth kicked in in order to learn the hard, hard lesson of just go deep in an unsaleable way to get to greatness. And now my focus is Sophie Society. Like we, we partner with brands, help them grow, and we focus on their PPC and AI integration. And, I have to constantly tell my team this because my my executive team, my leadership, they’re very hungry to grow the company through different offerings and expanding to other channels and things like that.

Outro 00:15:27  And, I feel like I’m constantly beating the drum of sending the message of like we need to do unsaleable things to ensure that we have greatness, because you have to dig to get to that gold. Like you really have to get down into the nitty gritty. It’s fractal like every time you zoom down to another layer, there’s a whole world there that you have to then zoom into. And it really does all have to, to work, to fit to, to get to that gold. Like, what is like the thing that really matters to the customer. And sometimes it’s something that’s really small, or sometimes it’s something that’s really simple, like something that was a side thought while you were you were developing the product or the service. You were like, oh, maybe this would be cool to add in. That becomes the one thing that they’re getting the most value out of, you know, 100%. And you only know that if you’re dealing intimately with the customer and working with them and getting feedback from them.

Outro 00:16:20  I went through 500 startups in in San Francisco with one of my previous companies, Judo Launch. And, I really shouldn’t have, Like, I was going to like high growth. Tech funded. We raised like, multiple rounds of funding for that company, but it wasn’t appropriate for that. That was a business that should have been a cash flow business that I tried to pretend was a high growth, like tech business. But one of the great things that I got out of that experience is like the first day we show up at 500 startups. One of the mentors, like, comes in you when you go through a tech accelerator like this. I don’t know if you’re familiar with them, but you have to move there. For all the top ones like Y Combinator, 500 startups, Techstars. You move to the like near their headquarters, and you go into their office and work with other companies every day, and you do. It’s very intense because you’re trying to run your business, but you’re also basically in like, school.

Outro 00:17:17  Yeah, because they’re bringing in experts, other founders, people on boards of different companies to like, educate the brand owners to help them learn all the stuff that we’re talking about people, product sales, marketing, the operations. And, the first thing they told us to do and this was like super patronizing to a lot of the founders. They were just like, none of you guys are talking to your customers enough. Yeah, they were just like, you’re what every single one of you needs to do today is pick up your cell phone and call your call a customer. And it was like, I know my customer, we have a team for this or we have a head of product. It was like, no, after like a week, everyone did it and everyone came back. Even the companies that were like, you know, really developed and far down the line have already raised like Series B’s or something. And they’re like, wow, I talked to my car. I actually talked to my customers.

Outro 00:18:20  Yeah, on the phone. And it was like complete, you know, brand new insights that we got out of it, because a lot of times it really is. It is a thing that you didn’t expect. You think you spent all this time on a feature or like one element of your service, your software or your product, and it takes a ton of people’s time and resources and energy, and it ends up not even being the thing that they’re getting value out of. It’s like this other feature that was completely separate.

Josh Hadley 00:18:48  Yeah. So here’s the biggest mistake I think people are making in the Amazon space. So the people that were sold, kind of like the courses in the 20 tens, it was like just find a random product and put your name on it fully.

Outro 00:19:01  That was excellent.

Josh Hadley 00:19:02  And just launch. Right. Kind of like what you talked about, which is like, I was just trying to throw stuff at the wall and just see what’s stuck.

Outro 00:19:08  Right.

Josh Hadley 00:19:09  At in. No part of that is there a conversation of like, who’s the customer and what’s the customer journey? And that is the problem.

Josh Hadley 00:19:18  So this is why, as we’re now at 2026, so many brands are facing margin compression right now on Amazon. Yeah, because at the end of the day, you might have a trademark. You might have a website with your brand name on it. You might have a plus content, but guess what? That doesn’t mean you have a brand.

Outro 00:19:39  Totally.

Josh Hadley 00:19:39  And so there’s a lot of I call them private label arbitrage sellers because there’s the arbitrage model on Amazon and everybody’s like, oh, that’s a that’s a stupid like business model where you’re going in and flipping stuff. It’s like you’re doing the exact same thing, right? Yeah. You just think you have a brand, but you don’t actually have a brand because you’re not compounding growth. And so and but I would also say there’s $100 million brands out there that are following this like private label kind of acquisition playbook. And it’s fine. You can make money, but there will be a day of reckoning where like the model just no longer works. Yeah.

Josh Hadley 00:20:13  And because you don’t have anything of value to offer. And so as soon as that whole algorithm kind of like shifts and changes, you’re going to walk away with nothing. Whereas if you actually build a brand. All it’s centered around is like, who is your customer avatar and how do you build around them? And that’s one of the biggest insights in order to scale into the hundreds of millions to a billion. You have to have a compounding customer base, which means every month when you bring customers through the door, you should have let’s say we bring 100 customers through the door this month. Next month I should add another 100. So then I’m at 200 now. There’s always going to be some churn, but like as long as you’re continuing to compound your customer base, that’s what’s going to allow you to scale. And that’s kind of the biggest mistake I see happening in Amazon sellers right now is we’re all just chasing this front end acquisition. Yeah. And you’re not thinking about, well, if they buy this, what’s the next step in the customer journey.

Josh Hadley 00:21:14  What do they need next. And how are you communicating that to them. Which is where where the oh I need to get off of Amazon. If you need to get off of Amazon, then go build your brand. And that’s where the Shopify Playbook comes into play. But it’s so much harder. Like it’s much easier said than done. Yeah. To build a true omnichannel brand. But that’s why so many people struggle on Amazon. And margin compression is because you’re not focused on the customer and the actual customer journey. And that requires a heck of a lot more effort. And Shopify is a different skill set than selling on Amazon.

Outro 00:21:49  Yeah, that’s so true. I mean, do you do you think, do you have like a framework for this or principles that you apply to, like actually focus on the customer journey and maximizing LTV rather than just the first purchase?

Josh Hadley 00:22:02  Yeah, 100%. So actually it was one of my latest podcast episodes. It’s like I spent months studying like, what does it actually mean to have a brand, and what does it mean to like, have a brand that customers trust and that you’re going to pay a premium for.

Josh Hadley 00:22:19  Everybody wants to have the premium price, but like you’re only going to pay for that premium price if you trust it, know the brand and that’s what you’re paying for. It’s like Nike, right? but with that being said, the framework is this for if you’re an Amazon seller, this is my recommendation. Amazon sellers like keep scaling what you’re doing till you’ve got a good flywheel currently happening. Like you’ve obviously got a product market fit. It’s not go build a next new thing. It’s you’ve got something working. Now my favorite step is to actually define what your customer journey is like. I love going to TikTok shop immediately. And the reason why is because typically the creators themselves are the customers. And so guess what. And that’s been the unlock for our business. So as soon as we started shipping all of these samples out I was like light bulb light bulb it because it’s it’s like I’m talking to the customers but I’m not. Yeah. Right. So they’re saying all of these pain points and all of these hooks, and I’m like, this is why people are buying on Amazon.

Josh Hadley 00:23:24  Okay. And also this is why they’re buying on TikTok shop. And then, lo and behold, that’s then what allows you to then build the team for Shopify because you’re like, all right guys, here’s the hooks. Here’s the angles. We now need to go create our meta ads that serve these. And then you begin building out like the best way I like to build out that customer journey flows. Like think about building an email sequence. What are you going to send to that customer over 30 days if they buy? What’s your one hero skew? If they buy that, what’s the next pain point that that kind of itches or irritates that you have the next solution for? And then after that, what’s the next solution after that? Because you’ve got to get it down in 30 days and serve that customer in 30 days.

Outro 00:24:09  That’s a really good way to view it. Like you’re kind of like using TikTok as like your petri dish where you’re like, experimentally, like just interacting and engaging directly with the market.

Outro 00:24:21  So you see what’s important to them, and then you see what goes.

Josh Hadley 00:24:25  Viral.

Outro 00:24:26  What.

Josh Hadley 00:24:26  Doesn’t hit.

Outro 00:24:27  You know. Yeah. The true. Yeah. So like what angles of the product were use cases you know. And then you can use that information to communicate that stuff directly back to them, like to your customer base. And it’s just reflecting their own usage of the product. That’s I feel like while you were saying that, like what came to mind for me was that that’s one of those insights that actually changes the true trajectory of a business, but it’s like an unsexy one, you know, like everyone really wants like a hack. What’s the new strategy? What’s the new, like type of ad I can run that’ll just crush for my products or whatever? But like, the strategy that you just laid out isn’t like a hack that will immediately boost your TikTok shop sales or your Amazon sales, but it is at a long term like health strategy for your business. Or it’s like, okay, so what do I get out of this? I don’t get like a bunch of new sales from viewing TikTok in this way, or gathering information from TikTok and using that as my, like, customer information source.

Outro 00:25:35  But what I get is all of the knowledge that I need to be able to build all the things that will end up growing the business. And I honestly feel like the the unsexy stuff is the sexy stuff.

Josh Hadley 00:25:48  It really is. But it’s going to unlock the sexy stuff at the end of the day. Because here’s here’s the enlightenment, right? Alex Hormozi talks about this. Why did he crush the gym launch space so well? It’s because instead of just going out and running the hey, here’s the first month free offer playbook that almost every gym does. He changed it and he said, okay, yeah, you can get your first month free, but it’s also going to come with all of these extra programs. And by the way, actually just put down $200. We’re going to send it back to you in form of credits. He had a whole escalation path or an ascension path, rather that within the first 30 days he was going to extract $6,000 out of that customer.

Outro 00:26:34  Whoa.

Josh Hadley 00:26:35  And that’s why, as he talks about it, that’s that’s the magic.

Josh Hadley 00:26:39  What he said, all of the money that he’s made in his life have come from short opportunities where he had where he was basically finding, 30 to 1, cap to LTV ratio.

Outro 00:26:51  Yeah. I’ve heard him say this. Yeah.

Josh Hadley 00:26:53  That’s right. And it’s because how good are you at extracting revenue or money from a customer in 30 days? That’s why I say the most important thing that you can do is build your own Shopify store. Because there’s no way you’re getting a 30 to 1 ratio on Amazon ever. Nobody’s getting that. You’re not going to find that right now.

Outro 00:27:13  that’s like a.

Josh Hadley 00:27:14  You’re not going to.

Outro 00:27:14  Have 3% ACOs.

Josh Hadley 00:27:16  Yeah. Yeah. That and you’ve got to have a massive offer. Yeah. In addition to that, you’re not going to find that on TikTok shop, but on Shopify you can. And here’s why. Right. You can get somebody in on that front end. And it doesn’t need to be a 30 to 1 ratio on the on the front end offer.

Outro 00:27:31  Right.

Josh Hadley 00:27:31  But do you have an ascension path. Do you have a subscription program that they join? Do you have a big upsell offer like a grand slam offer that you’re going to offer them? oftentimes this has been one of the things that’s changed us the most. Like if you’re like, ooh, that’s that’s a lot of money to like, I don’t know why somebody would pay $5,000 for, you know, dedicated one on one session with Becca of how to use our products. But I’m going to throw out that offer. And then you’d be surprised the take rate and you’re like, oh. And then all of a sudden, if you’re acquiring customers for $40 a piece on the front end, right? It’s a $70 purchase and you’re like, oh, I’m making out a little bit, right? I get I get a little bit of money.

Outro 00:28:16  Yeah.

Josh Hadley 00:28:17  But the magic sits behind in the funnel in 30 days. You’re going to try to get to that. I mean, in e-commerce it’s 3 to 1 ratio, cash to LTV ratio that allows you to hit like massive scale.

Josh Hadley 00:28:29  But like, it’s not like there’s opportunities to get 5 to 1, 10 to 1. And when you do that you go like as fast as you can.

Outro 00:28:37  And that is yeah, that’s it’s interesting because, you know, Alex wasn’t applying that to physical products, but, you know.

Josh Hadley 00:28:45  It’s gym space and that that’s the way I’m like reversing it into e-com.

Outro 00:28:49  Yeah. Which is, that’s always like a that that’s always a way to get really unique insights that the rest of the industry isn’t doing, is taking something from one industry that’s working there and applying it to an industry that has never seen that strategy before. I’m like, I don’t know how much you want to talk about the actual mechanics of that, but I’m actually really curious from your perspective of like, what are the. Are you attacking? Are you touching services to the products to get this like higher ticket in the first 30 days, or is it like software subscriptions or is it just subscriptions to the product itself?

Josh Hadley 00:29:24  So it’s a combination of both.

Josh Hadley 00:29:26  And so and again I’m not going to play the like oh we’re the expert. We’ve cracked this riddle by any means. Like I know to crack 100 million. Like this is what we’re like. This is the one constraint. If we find the right offer and funnel. Yeah. Like we’re like, we’re hitting the moonshot right there. Totally. So it’s much easier said than done, but. So what are we doing? There’s a testing cadence every single week. My team we’re a B testing different offers continuously. So there is going to be a subscription component to some of our products. So it’s offering this subscription and maybe we give it to them for free for the first month. So we’re going to test that offer. Then we’re going to test another offer where instead of them paying for one like a cheaper product upfront, kind of like a loss leader, and then trying to make that back up in the back end through email flows and stuff like that. Instead, what if you give them the Grand Slam, Grand Slam offer right from that, that cold ad? Right.

Outro 00:30:28  So on Shopify, from.

Josh Hadley 00:30:30  Shopify, right from meta. So it’s a test, right? I’m not saying that’s that’s it. But we’re testing that variable. We’re testing kind of a middle variable where it’s like, hey, here’s a cheaper offer or like a medium tier offer, but then there’s a whole bunch of upsells that they go into.

Outro 00:30:46  But are they mostly other products, other products?

Josh Hadley 00:30:50  yes. Yeah. So everything that we’re doing is like you’re combining multiple products together. Yeah, yeah.

Outro 00:30:56  Do you know anyone who’s doing this attaching services or software to products.

Josh Hadley 00:31:03  There’s a couple companies that are so love. Every is one of them that’s like kind of like a curriculum based like subscription box that we’re like really interested in what their model is. But that’s what we’re trying to do is basically say what services can we provide and what type of like, let’s be something different than a subscription box. Let’s be something different than a one time transaction. But that is that is the hard thing. And if you can just solve it, and I think it’s going to be different for every business.

Josh Hadley 00:31:38  If you solve that one thing, solve your problems.

Outro 00:31:41  Yeah, it 100% is like I found this with Sophie. Is that, like in 2023 was when we started to hit a completely different growth trajectory. Like we were growing, like, linearly from like, 2020 all the way through, like the middle end of 2023. And then when we cracked, paid ads for our own service. I’m not talking for the brands like we do that already. But when we cracked paid ads for our service, it was because one, I think, again, there was a component of luck and market timing to it, because a lot of the other, like, service providers in the space hadn’t yet really committed to paid. Now it’s like ubiquitous, but and it’s gotten a lot harder. But at that time it was kind of blue ocean. But the other thing was, and we still have this. This is why I think we’re we’re probably I don’t know anybody who uses paid acquisition at the scale that we do in our space.

Outro 00:32:42  And it’s because of exactly what you just said. Like we figured out, I wouldn’t say that we’re yet at the point where we’ve actually maxed the like the amount of, like, cash we can collect and value we can provide in return for that. But we knew our numbers. Yeah, that was the key. Like, we really went deep into our own numbers so that we knew for sure. Not not for sure, but like on average and like, you know, the statistics play out. If you know the average, you know the average doesn’t change. Like our trailing six month average is always going to be about the same until we make changes to our offerings. But we knew our LTV. We knew how long they would stay. How many of them would upsell into another service and what the total, gross LTV was and like net or net LTV or rather, I should say like after our cost of services provided. So then we knew exactly how much we could pay to acquire our customer, and we knew back calculated from that how many like calls it would take to get a customer, then how much we would have to pay for a call, and then we could.

Outro 00:34:00  It was very simple in our art. So it was like, what is our cost per call? That because we knew how that levels up to how much we make on our on our new partners, and having that information allowed us to just know whether we were winning or not. Sometimes we were above that cost per call, and sometimes we’re below it. And if we were above it, we’d be like, all right, we need new creatives. We need to like, hone in on our targeting. And when we’re below it, we were like, scale. Scale, scale, scale, scale until we got above it again. Then we have to work on something. And once we get it below again, we’re just scaling it. It’s a game like that and knowing the numbers was like the key.

Josh Hadley 00:34:38  But it comes down to the offer, right? Because like you had, you had an offer that was compelling enough to get people on there and then you had an ascension path. So like that at the there’s a reason why Alex’s first book was like $100 million offer offers.

Outro 00:34:52  Yeah, he started.

Josh Hadley 00:34:53  Because it’s offers at the end of the day. And like, what’s the other one? Like, what’s the one you just came out with money models. Because like the money model that sits behind it is like, that’s the magic. Yeah. And too many people are like, that’s been the biggest mindset shift. And really it’s only occurred to me over the past year. So I’m just like super anxious to see like where things go over the next decade. It’s like, oh, man. Like, I’m glad I know this now when I’m in my 30s, because I’ve still got another couple decades to pick the right vehicles, pick the right money models. And now I know that one of the key people that I need to have on my team is one of the best offer people out there that’s constantly testing and bringing new offers, because too many people think of like meta ads as like, oh, I just need to get good creative. Yeah, like good creatives like table stakes.

Outro 00:35:48  Yeah.

Josh Hadley 00:35:48  But like, even if you even if I had to pay double what you pay right now to acquire a customer. If I have a better offer and ascension path behind it, whoever has whoever can spend the most to acquire a customer wins at the end of the day. And so that’s why it all comes back to offers. And knowing what your offers are and comes down to serving the customer, at the end of the day, business is ridiculously simple, and I think that’s part of like our purpose on life as well. I think God intentionally designed it’s like everybody is going to come down here. The way you make money is by helping each other out. Pure and simple. And so really, if you just boil it down to like, be a good human being and go and find ways to serve people. Like, understand what their pains and frustrations are. And hopefully your skills and talents can be a solution to them. And that’s what makes the world go round. That’s all businesses.

Outro 00:36:44  Totally. Yeah, that’s a good message, dude. I think you can. You can take the devil’s path, you know, for for only so long. Like, there are a lot of entrepreneurs who they find a hack or something. Like you were saying before, it’s just taking something from this store and then selling it on that store or whatever. And it’s not. You could argue that there’s a small amount of value provided in that you’re increasing, you know, availability, but it’s the value that you’re actually delivering is like minuscule for these like hacky style business models, you know, like dropshipping and stuff like that. But the real unlock is when you start to provide true value. And that’s where it’s like the foundation, like underneath all this stuff, if the foundation is cracked, you could do all the sales, all the marketing, you know, all the SEO hacks and everything else. But like the foundation of the value that you’re providing to the customer, like if that’s cracked, you’re going to you’re going to spin your wheels and pull your hair out and just kill yourself on all this other stuff because you forgot about the most important thing that underlies the entire structure.

Outro 00:37:50  You know.

Josh Hadley 00:37:51  Totally. My favorite kind of like frame of reference is number one. Any business that you’re building. I like to think of it as like, number one, would I be okay with my grandma going through the funnel? So that’s the first that’s the first framework. Okay. But then and then number two. Is this something that could outlive me and be passed down to the next generation? Whether or not I want my kids to, like, pass this down, like that’s beside the point. I just think it comes down to running a very good business that, you know, it’s the hacky businesses that’s like arbitrage opportunities. They like.

Outro 00:38:29  You know.

Josh Hadley 00:38:29  You can make a lot of money, you can make a ton of money, but they will not be passed down to the next generation.

Outro 00:38:35  No. Absolutely not.

Josh Hadley 00:38:36  And so I just think about this. My frame of reference is always like when I am on my deathbed, what do I want to say I have done in this world? And family is a big part of that.

Josh Hadley 00:38:46  And the kids. But like we also spend the majority of our waking time in service to others in the form of business. And so what business is there that you want to say that you’ve done good in the world when all is said and done. That’s why I think there’s a lot of people that have midlife crisis, because they’re so focused on the money up front, and then you ultimately realize that money doesn’t bring happiness. It’s a tool to accelerate your skills and and who you are and magnify yourself as a person. You can do more good with more money, but at the end of the day, money doesn’t buy happiness. And so when you’ve optimized first for money, that’s when you hit the midlife crisis and you’re like, what am I doing? And then you find a lot of those 50 year olds and beyond that, just get into passion projects that are trying to give back to the world to. So the younger I think you can learn that lesson, I just think it sets you up for like a much bigger opportunity later on in life.

Outro 00:39:42  Yeah, dude, I love the way you think about this. It’s really refreshing to hear you talk like that. you mentioned, like you’re glad to learn this, like in your 30s, right? Yeah. And, I love being in business because, like, if we were, like, an athlete peeks in there when they’re like, what, like 20? Like, yeah, like 22. 25.

Josh Hadley 00:40:07  Yeah, yeah.

Outro 00:40:08  Like, an entertainer. They peak in their 20s, maybe early 30s. Like when you’re in business, you’re peaking maybe in your 60s, like, because you’re still totally, fully within.

Josh Hadley 00:40:19  Your 100%.

Outro 00:40:20  Like. So we’re still on, like, you know, the come up all the way through 30s, 40s, 50s, which is great because you can learn these lessons, compound them. And sometimes it is actually we keep we keep coming back to Alex. But I heard Alex say this once and it totally clicked with me because it was true in in Sofia right now, which is like, if you’re building a rocket ship to like, take satellites to space.

Outro 00:40:45  You really do have to have every part of it completely solid. You can’t have, like, the wings made from the wrong material. You can’t be using the wrong fuel or not have tested the fuel. You can’t have the heat shield be made of the wrong material or not be thick enough. If any one component is not there, you’re not going to get into orbit. And this this was like something that I you know, there’s one mindset which is like, okay, find out what you’re good at and try to focus on that and do more of what you’re good at and less of what you’re bad at. But that’s true only on an individual basis. Like as an organization, like as a company, you really do have to have it all dialed. And it takes a while to learn all that. Like, I had to learn the hard lesson, because I had that early luck with my first brand that I told you about, of focusing on product and the actual value delivered to the end customer.

Outro 00:41:42  I had to learn the lesson of like. Talking to customers and getting feedback in order to figure out what’s valuable to them. Once I had that, I still didn’t know. Sales and marketing. You know, like, I, I was part of that early wave where Amazon was doing my marketing for me, and it was just like you put on the product and you’re selling like crazy amounts and you’re like, this is life changing. But then for me, I had to get my teeth kicked in a couple times, you know, and the competition had to rise for me to actually learn that. I had to level up in all the other domains of business. And I didn’t actually get on a really exciting scaling path that I saw a long term future for. That excited me. Until I had product dialed in, I really understood actual marketing, like real marketing, not like what you learn marketing is, but like what actually works to like mark it. For us, it’s a service. And then sales was a whole other thing.

Outro 00:42:44  Like sales was like a a side thing. It was like something I didn’t even think about, like we had I would do sales. We had other people in my team that would like do sales, but they were more like consultants who would just say what we do. But once I learned like a true sales process and like what the different beliefs you have to walk someone through to get them to say out loud the thing they need to believe in order to close themselves, you know, and how to do good discovery, how to do objection handling like what a good pitch really is, and all the little things that have to be sprinkled into a sales conversation for it to actually be compelling. It wasn’t until I learned all that and did all that that that connected with the good marketing, which connected with the good product, which connected with, you know, the, the, the communication that we had to keep a cycle of product development through connection with our customers. Once all of it was in place, then the rocket took off.

Outro 00:43:45  Yeah, and like, I needed all of that. If I only had, you know, a few of those components. The one missing one is the broken link that keeps it from being able to scale. So it’s it’s true that you have to focus on like, what you’re really good at, but you actually do have to have it all in place. Which is why it’s good that we have some time to figure this out, you know?

Josh Hadley 00:44:07  Totally. I think the last point is you talked about compounding being important, and that’s why I think the younger you start in business, the better because you are compounding lessons. Here’s the biggest damage I think an entrepreneur can do. And I’m speaking to myself because like there were times where I dabbled in way too much. But you’re always you go to these conferences or you hear somebody else that’s crushing it, like there’s a landscaping company that’s just blowing up and you’re like, oh, maybe I should be in the landscaping business. And then you hear, hey, acquiring and flipping and rolling up HVAC businesses is the latest sexy thing.

Josh Hadley 00:44:49  Should I go, oh, man. Should I be in that game? Is that better for my talent? Then you’re like, oh, but look at Grüns. Like they just exit for $1 billion. Like, I think I could be a CPG brand or, oh, SaaS. Like, I need to be an AI company, right? And you just see so many entrepreneurs jump and always like the grass is always greener somewhere else. But every business model has it’s hard. And so in the landscaping space, if you’re going to do that, like I know what your constraint is, your constraint is going to be labor and finding cheap, affordable labor that can actually go mow the freaking lawns for you. And you know, you need to have a sales process. And look, if I have my digital marketing background, like I know I would slay it in the freaking, like, landscaping business. It’s like, oh, man. Like, I could crush it, but what I could not what would crush me is like, all right, dude, go, go pull out your Rolodex of, like, cheap, like like labor workers that want to go out there and mow plans for you.

Josh Hadley 00:45:51  And I’m like, oh, I don’t have that network. And that’s the hard that you have to get through. So I think it’s just understanding that, like, SaaS has a another level of heart and AI. And so do you know you’re in the services business, right. And agency model. And so I think that the more you can compound growth in one vehicle and learn the lessons, you’re like, okay, I like now I’m starting to be like, I know the CPG game and I’m still not there yet. Like, our next thing is like, I want to know how to get into retail and own retail and say, like, I have the playbook for retail because then I’ll be like, I can see the flywheel from Amazon and TikTok shop and Shopify and, and retail. And I can then have the full flywheel effect and that’s its distribution and its you only get better while you’re in the game. And so for you, it’s like, what is the next decade look like for yourself as you continue doubling down and getting better at providing services to people? Right.

Josh Hadley 00:46:54  And you’re like, we’re providing these services. But I think we could take things to another level too. So it just gets better over time. Like biggest advice to anybody in business is like, just stay in the game. Stay in your game. Right? there might be times where you have to jump for whatever reason, but like stay in your game and let good things happen.

Outro 00:47:16  Yeah, dude. Fully. I, I saw this like cartoon online once, which really resonated with me, which is basically like it’s a one shot visual of what you just said. So it’s like this like stick figure. And he’s like, he’s drilling for oil and you see that he’s got like six holes behind him. Each one is like five feet deep. Yes. And he’s on the next one. And then the next panel is another guy, and his hole is 50ft deep. And he hit the the oil well down there. And you see that the oil is below, right below where the guy was trying to drill.

Outro 00:47:51  But he never reached it because he just kept on trying something, another hole, another hole, whereas the other guy just went deep in one. Yep. And like, I feel like I want to make that like my laptop background or something.

Josh Hadley 00:48:02  It’s like, stop. Entrepreneurs is the worst.

Outro 00:48:05  It is. It’s hard because you have that money.

Josh Hadley 00:48:07  I could I could go crush it. Yeah. In a landscape.

Outro 00:48:10  And you really.

Josh Hadley 00:48:10  Could. Like, I could have a good agency, I could. Yeah. There’s a lot of things I could be good at. But Alex talks about this in your lifetime, you probably have 2 or 3, like, massive shots that you can take to get really good at something.

Outro 00:48:24  Yeah.

Josh Hadley 00:48:25  So it’s like, yeah, you probably have 101 things you can do and you could be great at. You’ve only got 2 or 3 shots.

Outro 00:48:33  100%.

Josh Hadley 00:48:33  So how are you going to take that shot?

Outro 00:48:35  Yeah, fully. Do you think you’re on your first shot still?

Josh Hadley 00:48:39  Yeah.

Josh Hadley 00:48:40  Still on the first shot for sure.

Outro 00:48:42  Do you have any idea what the next one will be?

Josh Hadley 00:48:45  yeah. Billion. I mean, billion dollar portfolio. Nice. That’s like. That’s the goal.

Outro 00:48:50  In physical products.

Josh Hadley 00:48:51  In physical products? Yeah. I mean, I think it’d be cool to like, I think I have a good business acumen. So it’d be interesting to, like, be more broad, kind of like Alex is. But I think it’s like there’s a lot of nuances in the CPG space that you just go for days.

Outro 00:49:10  Yeah.

Josh Hadley 00:49:10  You know. so yeah, I don’t know. I do know that, there’s a plan for everybody. So it’s just kind of like you stay in your lane, take the stewardship that God gives you, and you make the best of what what’s been given to you. And when you magnify your talents and whatever God gives you, like just you can be confident that you’re going down the path that’s going to be the best development for you in this life.

Josh Hadley 00:49:35  I think that this life is just a very small, like figment of our imagination. In the grand scheme, I think of things of eternity. And so it’s just at the end of the day, it comes down to like, are we becoming better humans and are we learning and are we growing? Business is a great tool in order for us to shave off a lot of rough edges.

Outro 00:49:56  Your customers are lucky, dude, because you really care about them. Like you care about your team, your customers, your total impact on life. And that’s awesome bro. It’s a really good frame. It’s been well, thanks again.

Josh Hadley 00:50:09  This has been awesome man. Thanks for having me in.

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