Why Most E-Commerce Brands Are Measuring the Wrong Metrics (And Paying for It)

0:00Most e-commerce brands are measuring the wrong things. They're tracking our ways like it's a health metric. It's not. It's a signal. And if you're building a business off a signal, you're flying blind. My guest today spent 12 years in the trenches of digital marketing, built an agency that works predominantly in health and wellness, earned a PhD in functional medicine, and then wrote a five book series to make sure e-commerce founders never get burned by the wrong agency again. He's got a framework he calls the holy trinity of metrics. And by the time this episode is done, you're going to look at your ad spend completely differently. Mark Young is the kind of operator who hand you the playbook before you even ask for it. This is The Vault. Let's unlock it. I'm Mark.

1:00Relive here. Welcome. Welcome to the show. Appreciate that. Appreciate the invite, buddy. Yeah, I think anyone that's listening right now, this we are going to be deep diving into, I would say, all things e-commerce. So if you have an e-commerce brand, if you're e-commerce business, this is going to be the episode for you. I know, Mark, we were just talking for the show, and you said that you came out with this new book called e-commerce guide to the galaxy. Is that correct? Yeah, it's actually five books, K-von, because I actually started writing it as one book, and literally I was like, okay, this is like a 600-page book. No one's going to read that. So I ended up breaking it up and doing this stuff. So it's like, it's actually a five-book series. And really, it's about e-commerce, but here's my angle. I'm an agency owner. Like, I'm just going to sell out and tell you, like, I own an agency that deals with e-commerce brands by and large. But one of the things that, if I can say pisses me off, is that every single time I'm talking to a potential new client, I end up having to

2:05drudge through the baggage of what they've been through already. And you know, it's like, I end up having to take them through triage and then through the ER before I can even get them into the hospital. And a lot of that is their misunderstanding of the metrics that move their business. And the agency did something and they thought it was wrong. And sometimes I'm like, no, actually what they did was right. I'm sorry, you don't like it, but the agency wasn't wrong. And sometimes it's the agency just started using smoking mirrors to make it look like they were performing and they weren't. And there's the reality. Business owners, this is my thesis. I'll wrap it up here. Like my thesis is the business owners get into businesses because they're really, really good at people. And as my friend Ben Hardy says, this is a who not how a situation, right? Like so when it comes to marketing, find your who. Yeah. The problem is is that business owners, they don't know how to do the marketing. And if they did, they wouldn't be running their business.

3:06They'd be running marketing companies. And my entire goal in all of this was I want to write a book that literally becomes, this is your travel guide. Never be taken advantage of by an agency again. And at the same time, this is my if you're going to work with me, you need to understand all of these terms and all of these strategies because now nothing I tell you is going to be a surprise. Like I'm literally handing you the playbook. You want to run it by yourself grade, it cost you 1295. You want me to run the playbook for you. Cool. You know in advance what you're getting. Yeah, I love it. I can tell you're the passion and the, the, the same thing that I deal with is just there's good agencies, there's bad agencies. And there's, there's good business operators and there's bad business operators. And when you may have them all mixed in good things come out, bad things come out, ugly things come out. It's a nightmare. So I can understand the pain.

4:08I'm going to call it the pain you've probably gone through from like just discovering what was not working or what was working, but it wasn't working because of XYZ. And we're going to get in all of that. So let me, before we go into the power of the books and the power of what you do, I think it's going to be a service to tell us a little bit of how you got here. Like what's the background? What's behind the vault that got you to where you are today to have the power to be able to bring e-commerce to another level for our business? So I'm a bit of an unusual animal as I think most entrepreneurs are. And I always say I love, love working with entrepreneurs. They're all crazy. Like they're, they're absolutely all crazy. And as much as I prefer sanity in my life, I also love a little crazy. I even live downtown because as much as I complain about it every morning and I drive to the office, I still choose to live downtown for a water deal because it's crazy. It's busy. It's

5:11traffic. It's all that. So I do love it. And entrepreneurs are my passion. And I'll say entrepreneur ship is my passion. Like they're all nuts. You know this. You work with this, this audience too, right? Yeah. And they all get defensive and then they all kind of chuckle and go, yeah, I guess we are. Like it's just kind of the way that goes. So I've been in an entrepreneurial family and I laughingly say that entrepreneurship is kind of like a nationality. Like you're just born into it. You can do nothing about it. And once you get the bug, you're just you're part of the part of the machine. My father actually ran an advertising market agency. He's owned his for 30 years. I swore I would never be part of the family business. That is not what I wanted. I went to college a lot and ended up becoming a college professor, worked in education, ran private colleges for ages. And what's really funny is I worked in private and public education. I loved private education more than anything. And part of the reason was because it was entrepreneurial.

6:11It was very granular and the way we ran the business. It was it was education. So I got the philanthropic high from actually helping students and seeing outputs and people that had nothing go to people who had established careers. Like that was exciting to me. But I love the grid of the entrepreneurship. How do we how do we hit enrollment goals the next start like all this kind of stuff? Well, I ended up getting out of that. And what's funny is that I did end up going and working with my dad for for a little bit after I got out of education because I was like, I don't know what I want to do when I grow up. And that's a weird question to ask yourself when you're 39 years old. Yeah. Yeah. And my dad's like, well, look, I need some help right now. We're working with some some giant clients right now. And one of them happened to be in health and wellness space. And I'm like, well, I'm not doing anything like I'm just, you know, sitting on the beach in Florida. So sure, I'll come back to Michigan for a little while. Didn't take me very long to decide several things. One, I didn't want to work for my father. Two, I didn't want to live in Michigan.

7:17And three, I not only fell in love with the marketing side of the business, which I had grown up around, but I also fell in love with the health and wellness side of the business. And I have subsequently come to the point that I even went back to school and earned a PhD in functional medicine. And what I find is entrepreneurs and longevity are probably the most overlapping vent diagram I've laid eyes on in a really long time. Yeah. It's huge because partially we're all crazy. We love experimentation. We understand the value of time. So sickness is not about health. Sickness is about time lost. And I'll overlap that to say that we all love looking at dashboards and figuring out how to make them better. And that's all longevity is about whether I'm logging into an oral ring stats in the morning or I'm looking at my labs. It's no different than me looking at a digital marketing dashboard and going, okay, if I make this one change, I can do this. Like, how do I

8:21get my HRV to move? Like the same thing. It's gamified. And I think entrepreneurs love gamified things. I get it. I love it. So and now you as a result of working with your father and then moving over, you really got into what it sounds like is the online game, the commerce game, and working with big brands. And specifically in health and wellness, or have you kind of expanded? I would say that's probably 75% of our clientele falls in the health and wellness, you know, CPG direct to consumer marketing. Not everything we do is e-commerce, but everything we do is online. So we do online support. As a matter of fact, just before this, I was working on an analysis for an international brand, rebuilding their US market, but it's not direct to consumer at all. So it's not necessarily direct to consumer, but it is very much e-commerce in so much as it's online marketing. So yeah, we dabble in other things like we certainly have expertise in other

9:24things. And where I thought you were going with that was that for me, I focus in the digital world, my father's agency actually is the exact opposite. Like it is such a complement to what we do, their television, their radio, their brick and mortar. Like they're the people who have all the buying relationships with Walmart and Target and so on. So it kind of is somewhat organically turned into this step one step two, where what we're finding is sometimes he'll get leads that come into his agency and he's like, you're not ready to go national TV. Like we need to get all your other stuff under control. Let me make an intro. And then we nurture them and then pass them back. Sometimes we're working with clients that expand to the point that they're ready to go national. We're ready to go into retail. They're ready now. They've hit that maturity in their business life cycle. So it's a great partnership and what's been fun about it 12 years later because it's been that long, which is crazy to imagine. But 12 years later, like we're back

10:28together working hand in hand, but working as partners, not as subordinates. And it's a fun handshake. So for anybody who listens to your podcast, who works in the family business, you have to tell you it actually can work. I love it. Yeah. Well, it seems like you guys are running to adjacent like kind of businesses, but in parallel with each other. So much other. One man. Yeah. So you're like,onomy, you're not underneath your dad or your 100%. Well, and I got to tell you like for a lot of people out there and I'll speak to the the children of entrepreneurs. And I will say that if if mom or dad was successful in that world, there is a shadow that that is always cast. And again, I say this at 51 years old, but even even at 39, 40, 41 years old, it was like, sorry, you got a 20 year head start on me. So you're of course going to be more accomplished than I am in that respect. But at the same time, there is an element

11:29of I believe that I'm speaking from, you know, and equals one, that there's a need to make sure that you're able to prove your own muster on your own. And as an example, like even in this partnership that we're working on between the rise agency and Jekyll and Hyde is even his team, like all of sudden the boss's kid is back around, you know, and it's like there's a natural bent for people to you know, to assume nepotism. And you know, and the laugh for me. And it's like, great, let's just pull out your resume, pull out mine. I have absolutely no problems with it. The fun thing is I'm a capitalist. So like when I hear about Nephth, yeah, like I have no, I have no problem with Nephth. Because you're the business owner, you started the thing, you started it for legacy for your family to work into like it to me, it just doesn't make sense. It's hopefully,

12:30right? It's when it comes challenging is if the child or the young one is not good and they're in the seat and they're destroying the company, that's you know, that's a different story. But if they're pulling their weight, I mean, why not? Why would you hire outside when you can hire within someone? You know, yeah, because there's a trust factor that's somewhat just inherent in that. And there is a legacy, as you said, but I think they even goes one layer deeper to that. That is, they're my chips. I can bet on whatever number I want. Well, that's the thing, right? But I guess, you know, as an entrepreneur and owner, I mean, I see that. I always think you have options in life, right? So if you walk in like I'm in a business right now with mass neptism and I know what I'm dealing with, you know, I don't complain about it. I there's not you can't complain about it. You either deal with it or you move on. Right. So one of my clients, you know, Dan Sullivan, I know Dan Sullivan. Dan's a good friend, strategic coach, the whole deal and Dan has a philosophy

13:34called guesses and bets. Sorry. And guesses and bets. Oh, guesses and bets. Yeah. And his philosophy is that throughout your life, you've just made a lot of guesses. And all of those guesses had some kind of bet that you put on them. And then however it turned out, you learned from it, you guessed the next time. And but every guess you take has chips on the table. And I think in this particular one with with entrepreneurial families, it's like, yeah, is your is your kid the most qualified person to, you know, create legacy? Maybe. But that's up for the business owner to take that guess and take that bet. And if and if the business owner loses everything because the kid was the wrong person to run the company, it's his money. That's exactly like you said, it's his chips. So let's circle back. So let's circle back to the to the to the series, the book series. Because I think it's very interesting. Sounds like you're giving away the keys, aka, given some stuff behind

14:38the vault in these book series. Where did you, where did you get the idea of this or where it was it that you decided, Hey, I need to get this information out there. And or I want to protect because I think it came from a place of also protection for younger startup businesses not working with the wrong agencies and are going down the wrong rabbit holes. Yeah, well, I'll tell you as is most things in my life, they all come from moments of frustration. And the frustration was twofold. Mostly it was because I was sitting on the telephone on Zoom calls all day long as I'm sure you are too. And as I spend my life on Zoom, but 45 out of every 60 minute meeting is spent having to fix a client or a would be clients worldview mindset, whatever work you want to assign there. Because and I'll give you a very tangible example. I had a client once upon a gram correction once upon a nightmare who said on a call 1.7 row, that is the number. If you

15:43can't achieve 1.7 row as on every month, we're done. And I'm like, well, that's a really interesting first 30 days conversation that okay. And and of course, I'm an educator. Remember that. And I'm like, but that's a terrible metric. And she's like, no, I said 1.7. And I'm like, but that's a terrible metric. And of course, and I'm trying to be kind about it because I don't like necessarily calling people's babies ugly. So are calling people stupid. But I'm like, let me explain how row as works like this is a this is a trailing metric. But you're measuring row as at the account level, which means you're not measuring campaign level row as or ad set level row as or anything. And I can be and you're not at all measuring blended M.E.R. Which means each of your channels that you're using for marketing don't behave the same way. But they do behave together. And and

16:44trying to explain this that I need a 1.7. And I said to her, I'm like, look, here's I'm going to tell you I'm looking to your data. The way your last agency always got you 1.7 row as was that the remarketing that they are putting your budget is all in remarketing campaigns. So making your demand hurt you because they're acquiring hardly any new customers. And the only reason they're not acquiring new customers is because you told them they have to hit a metric. So they went to the easier sales. It's always easier to sell to somebody again than it is to sell to somebody the first time. And you've set that standard for them. I'm like, I can manipulate all of your data to get you to a 1.7. I said, I would never do that. But I want to teach you how that shouldn't happen to begin with. And it really it had me unpacking something that I call my whole atrinity of metrics. And I'm like, Roas to me, it's a false metric. It's terrible metric. It is a

17:45trailing metric. And it is interesting. I hate it. I hate that I come from a world where all people look at as Roas on the right. That is that is most people in the world. And I will I will debunk that for you right now. Okay. Now I told you the beginning, we're going to get somewhere. We're going rounds here. We got it. Let for those of you that have been living your business off of Roas, let's go. Now you I want to I want to just for me to calm my brain down. We're talking Roas. You said at the account level, but we can be talking about Roas at the you know, campaign level and or product level. So Roas to me is a signal. It's not a health metric. So if I mean, and again, I also have a medical background. So I'm going to make some some health metaphors and analogies here because that's the way my life was. Roas to me is you came into the doctor's office with a fever. Okay. Feavers not a diagnosis.

18:49It's a signal. The only reason you went there is because there was a signal that told you to look deeper into something else. Roas is a symptom. So you've got I agree. Okay. You have some ads for instance that are getting very few sales. Roas is telling you that's the return on ad spend that you spent $500 in this ad this ad set, this campaign, whatever you want to call it. You spent $500. You've only gotten $200 back. Here's the problem. In some business models to spend $500 and get $200 back, that's okay. Well, now yes, I agree. You can actually lose money to get a customer if you have vaccines. So actually a lot of companies do that because if you're on a subscription base or whatever it might be, I am yeah, correct. We should we bump pack out or does that make sense? I would love to unpack that and you are correct. But in part of that is based on Roas targets being correct because there is lifetime value to consider. But outside a lifetime value, what I always talk about is that's a downstream metric because by the time Roas

19:54takes place, it's a trailing metric. It is kind of like looking at last month's financial statements. And I can look at last month's financial statements. But if they don't teach me what to do with next month, it's just a history book. And I am no interest in doing my business in history. I need to be looking out the windshield, not the rear view mirror. There are three things that I can pay attention to and the three things that I always refer to as my holy Trinity of metrics is my lifetime value as we just discussed. What are the actions I can take to make somebody purchase from me one more time because I will use an example of a company called proactive. You are familiar with them, I am sure. The skin, yeah. Proactive spends over $300 for every new customer acquisition. Well, if you are familiar with the brand, the whole product get only sells for $100 some on dollars. Why would a company do that? Well, two reasons. One, they are very cash positive, which means they can afford to take a loss on a customer acquisition. And they also know that

20:57the average person who gets onto their subscription or repurchase, as you said, that person stays around for six to seven months. So if I spend $300 to get a customer, but I get $150 out of the customer every month for six months, spending $300 just got me $900 in lifetime value. And a three to one customer acquisition cost to lifetime value ratio is perfect. That's a text book. I call that the scale button. 100% push it until it starts to stretch. But that's a business decision, which I always make a distinction. You and I understand business decisions. Not every company can make that cash flow decision. So it's interesting you said that because there's I think there's two decisions there, right? The A, the cash flow meaning can you have the cash flow to support it? Because it takes one, I'm going to say two, three months. You're running negative. You're running negative. But then there's also the entrepreneur mindset challenge, the business owner who doesn't like,

22:03they get it, but they don't get it. Like they, when it comes to like, and you could show them the money, you could literally show them the on paper, but their brains just won't add up one plus one equal to because all they're seen is, well, it cost me $300, but I only make $100. No, I'm negative. That's not how you run a business. How do you get around that mindset? Like how do you actually train somebody and or get people to realize what is actually happened because as a smaller business, it could be scary. You are putting, you said we're making guesses. We're putting chips on the table. Putting a lot of chips on the table. That you're, you're exactly right. And then that, that literally becomes what I call a waterfall analysis. And that is in this month, I'm dumping all the money in, and I'm going to be negative cash flow. But if I only have $15,000 in the bank, I can only buy $15,000 worth of leads because that $15,000 is only going to give me $7,500 back using that proactive model as

23:04an example. I only put $7,500 back on. How am I going to get the $15,000 for next month's lead generation? And it really becomes a game of cash at that point because a lot of businesses can't support scale because of their, because of their cash position. And that's just an under capitalized thing. Now for a lot of businesses, they don't have the long term takeaway. They don't have the long term picture. And part of that is because I'm going to tell you most business owners and entrepreneurs that I know, and maybe your audience can prove me wrong, look at the bank balance more often than they look at a financial statement. And because of that, like I am the entrepreneur who looks at the bank account every morning. I don't know what I'm trying to accomplish by looking at the bank account every morning. But every single entrepreneur I know knows exactly how much money is in the bank today. But if you ask them what their contribution margin was last month,

24:06most of them would have to go ask the account. Because it's just the nature of what we do. And using the Colby scores, like most entrepreneurs tend to be like 7, 8, 9 quick starts. Like we're ready for a game. And all of these financial things. I was going to say I was going to let you away from that. Yeah. But it all matters because lifetime value is something that I can help control. I can create experiences. I can, I can create life cycle moments like emails and SMSes and all of the things that keep my customers engaged. The second thing, I can control my average order value. How do I get a bigger cart? If $150 in cart value for a $300 acquisition is too painful on my cash, great. Let's talk about how we get a bigger cart. Maybe I can get my $150 to a $200 cart. And then my payback window is only 70 days or whatever instead of 90. The third metric, this is my

25:08holy trinity, is acquisition cost. Because while one mindset is increased the size of the cart, the other one needs to be talking to the cat. Cat, exactly. And I'm talking to NCAC specifically. Because we're talking new customer acquisition costs. This is the cost of a new customer not just acquisition of a transaction. And that's also where this 1.7 row S is a problem. The A, yeah, okay, hold on here. We just divided that up for a second. So there's CAC. And then there's NCAC, you said? So CAC is customer acquisition cost, which should refer specifically to the acquisition cost for a first time buyer. Yes. The problem is that many businesses actually don't necessarily call that CAC. They call that like CPL or CPA, which is cost per acquisition or cost per lead. Yeah. The cost per acquisition technically is referring. And this is where all

26:11these acronyms start to screw people up. If you're not an industry expert, cost per acquisition is literally the cost for the sale, not the cost for the customer. Yeah. So I may have spent $170, $150 just to get a customer to buy a second time because all of it was in the remarketing funnel. Well, that's a cost per acquisition. But if that's a customer who already bought from me before, I shouldn't be paying such a heavy penalty to bring them back on. My marketing cost for a second purchase should be significantly lower than marketing costs for a first time acquisition, which is why I need to be looking at that lifetime value metric. What are you doing to off channel keep that relationship with you? Goes back to, I just want to make sure people are paying attention here, goes back to row as, which is I can get a row as when I'm looking at retargeting my customers.

27:13Can you get the row as when you're bringing in new customers? Can you hit your row as target if it's all in new customer acquisition? And that's where I'm telling you that row as is a bad metric because as an example, let's go back to that 1.7 crazy lady. 1.7 in that conversation is like you're fighting for a 1.7. The problem is her average order value was $150. Her lifetime value of a consumer was 1200. So ask me, Kaven, what would you pay to acquire a $1200 lifetime value because the reorder rate is so high? I don't know the exact math, but what I would be paying on 1200, I'd be paying, I can go up to six, you can go up to seven. Well, keep in mind our 3 to 1 cack to lifetime value ratio 3 to 1 for a $1200 lifetime value. If cash is not a problem, I'd pay up to $400 to buy that customer. Well, that's what I'm yeah, exactly. I'd pay up to 400 bucks, but

28:17using her model of a 1.7 row as that means that $150 first time order needed to be benchmarked against a 1.7 row as meaning that we could only acquire a customer for $90 or less, which makes it so much. Zero sales. Well, I also make like a $1200 lifetime value for less than $90 in ads bet. Tell me if this, if I'm right on this, because I'm not saying the expert, when I heard that, the first thing I thought was like, and making the marketer's job so much harder than it needs to be, and leaving so many opportunities on the table. You're a hundred percent potential, like potential, like whether you want to call them CPLs or even opt-ins on the table. That's exactly right. And the issue is it's a scale issue, because if you want to be a scale like that, you are you care, but your have your scale and slow it along. Your scale is a customer's a month. Yeah, you can't.

29:20With the kind of margins, and by the way, her margin, oh, I don't even want to know this. The margin was like a 12x. So cost of goods was like nothing. Yeah. So for that $150 $150 average order value, the cost of goods in it was less than $10. Oh my. Thank you. Wow. So those are the things. So you had the original question you asked me was, what caused me to write a book like this? And the reality is, is what caused me to write this book was trying to get a level set conversation that when someone comes to me and says, but I'm like page 46. I want you to book to page 46. Yeah, it was great. I understand me. Go to page two or go to book two, chapter three, go read this section so that when we get to a conversation, there's a common denominator

30:21because you're bringing language into the conversation like, for instance, the difference between CAC versus cost per acquisition. Those aren't the same metric. And yet they are used interchangeably. And I'll say two things. One, ignorantly by entrepreneurs sometimes. And I mean, ignorant in a just lack of knowledge, not as a, not as a negative, but manipulatively by agencies. Because if an agency clearly explained to you that it was a cost for a new customer acquisition, those numbers are never going to be as good as a cost per acquisition, meaning just the attributable marketing towards total sales. And then the other side of that is channel acquisition is an entirely different issue because first of all, not all sales are attributable to a specific channel. And maybe I saw you on meta. So I went and Googled you. Who gets the win? Well, now you just open up another. We are open up Pandora's Box and we're

31:27staying here because it's so important because I've been in so many businesses where that becomes especially online businesses, higher ticket. I usually come from more the services size of 5, 10, 15, 20, $50,000 ticket. And the marketing is arguing with each other of where or the channels. That's bad. You're bad. The channels are arguing. That was my lead. That was my, and I'm out of point where I say that there's, you can't track it all. Like there's no way you can track it. You can track. You can try to track the first point of entry. But there is no way to possibly track what you said is I saw an ad on YouTube. I went to Google, the search you up. I got busy with the kids. I went back on Instagram. You targeted me. I watched the VSL or I watched whatever I went and read the sales page. Then the other kid pulled my leg. And then I just went straight to the website. I was like, you know what? I'm going to the website. Well, it's an organic sale. Your marketing

32:30efforts did nothing. Or a thousand. Yeah. I mean, sarcastically. I'm saying exactly right. The owner looks at it and says, well, they came straight to our website. That had nothing to do with marketing. Yeah. Or social or it's totally, I guess, yeah, you can't. You cannot tag somebody because unless they do an action, you can't tag them. Well, what we find is there's there's more the bigger problem that we have in cross-platform attribution is double attribution because there's, you know, again, in your scenario, let's assume that all of that happened within a seven day or a 30-day window. The issue is, as your example was, I saw you on YouTube. Great. YouTube counted an impression. Well, then you Google the person. Google just pixeled your machine. Now Google and YouTube are kind to the same story. But Google pixeled you. You went to Instagram and got remarketed too because Google's pixel shared with Meta just pixeled you. Then you ended up getting an email because you watched the VSL. So, Claudio just pixeled you. Then you ended up going to the

33:34website and converting. But we just counted three pixels and all three of them claimed a win. How do you deal with that? You deal with what's, I mean, and again, I'm going to arguably say it's just the rules of engagement because some businesses count first click attribution. Who introduced us? Last click attribution. Who closed the sale? Or what we call weighted attribution, which is, let's assume, and I always say this is, I'm from Hockey Town. I'm from Detroit originally. So, I always look this is, we don't just count the goals. We also count the assists. Yeah. And because of that, I mean, nobody in basketball ever got an assist, right? Like, you got the good, you got the bad or you didn't. Hockey, we count the assists too. So, when we're looking at attribution, it's who got the goal, who got the assists, who was the person that stole the base versus who actually got home like in baseball. So, every sport measures it differently. It just depends on

34:41what are the rules of the game and what are we counting. The goal for a business is not that any one of those are better than another. The goal is to just consistently count them month after month so that you're not looking at apples and oranges type type data. I was going to say, yeah, there's not one decision you make. You track all and then the decision comes from what is the most important metric for that business. Correct. The fall. And in your world of a $15,000 ticket item, for instance, it's probably a very different metric than a client that this is so funny. I use this client as an example and I love him dearly. He's literally like the world's kindest, most congenial human being, present company excluded. But he's just a nice guy and he sells socks that have like bible verses and stuff on them. And it's company called Bible socks and it's just the funniest thing to me because they sell. And I think it's amazing and they're great quality socks and everything. But

35:44he's selling a $18 pair of socks or a $15 pair of socks. You're selling a $15,000 item. Such a difference. So the way that his business tracks, like there is no middle funnel. There is no education sequence. No one needed to go through an education sequence or a VSL before they bought a pair of socks. They're impulse buys. It's the convenience store crowd that I didn't buy the gum because I was searching all over the place. I've never bought gum online. It's a gas station. It's whatever. So consumer behavior on those types of things are just very different. So what measures them should also be very different. Absolutely. But at the end of the day, we do, even in my world, they do a lot of row as measurement. That's a big one in ours. But cost to book call is a big one. And then I run a sales agency. So mine is more of the sales metric, which is what we call as average appointment value. Meaning how many dollars does my sales guys

36:49make on every call or every booking that lands on their calendar, regardless if they show up good fit, bad fit, whatever it is because it costs the company $150, $200 just to get a booking. It's 100%. Back when I used to run sales teams, we always used to talk about lead to appointment appointment to show, show to interview and interview to start. And that's the education funnel. That's a, the lead came in. How many of the leads that came in actually turned into the person on a telephone setting appointment of the appointments that you set, how many of them actually showed up for their meeting of the people that showed up, how many of them actually signed paperwork and enrolled and of the ones that enrolled, how many of them actually started classes when the semester began. And literally looking at those five numbers, and this is a lot of what I did in my early days in education was fly all over the country and train teams on this because it was like, no, your lead to appointment is down. And like we have a script problem. Like you're not following

37:51the script on a telephone call. And nine out of 10 times I could listen to recorded calls and be like, there you go. You ended up talking about the, about the student's dog. Well, the student was talking about his dog because the dog was barking in the background. Then you let the prospect control the call conversation. Yeah, again, it's absolutely. Yeah. And all of that training, like why did, why did the person not show up for their appointment? Well, I can listen to the phone call and tell you why they didn't show up because you started, you used the phrase, well, when works best for you. Yeah. Or you set the appointment two days from now or three days from now or until next week. Like, no, here's the answer. I have an appointment available at 515 today or one at 930 tomorrow morning, which one of those works better for you? Yeah. Like this is basic stuff. And that's exactly it. And if you understand your funnel, you understand the break points and exactly how to fix the funnel.

38:51Delivers. Totally. AOV, CAC, LTV. I can move the levers. Those are all break points in my, in my funnel, if you will, that will pan out in my row S. My row S will change because those are my upstreams. The Trinity, LTV, AOV and CAC, or CAC. There you go. That's exactly right, buddy. It's my story. I'm sticking to it. And for those that want to learn more, I mean, you basically put this into a full book series. Yeah. Go take my knowledge. Do what you got to do. So where do you see marketing and all of this, like even LTV, AOV, all of these metrics, how are you seeing these going to be changing the way consumers are buying the way AI is being obviously implemented into all of this, where we are in the world today with everything that's going on. Are you,

39:52are we going to be tracking the same metrics in the next 5, 10 years? Or are we going to be tracking different metrics? That's interesting. So yes, AI, we could go on for another hour because that's probably my next favorite topic. The reality is, as an agency, we're super heavy in AI. I would say that we are probably more advanced in AI than most companies I know because I had a meltdown about a year and a half ago. And it was, it was not anything too dramatic. And most people didn't notice, but I try to keep my panic attacks behind closed doors. But watching the way AI was starting to revolutionize the marketing world pushed me into a place of having to say, do I have a business two years from now? Like, is my skill set even valuable? And the truth is, I think every smart person in the world is asking that exact same question cross discipline. Like, doesn't matter. I mean, if you're a doctor, you're asking yourself that question because AI is able to diagnose better

40:53than most physicians. So the crazy thing is the physicians don't want to believe that. It's even the crazy thing that's not a leader's been sad because who you're going to go down to rabbit hole here because I'll tell you I'm all right. I love it. But it's sad because I'll just take a whole step back for right now. It's like the 30 step view, the 30k view of this is like everyone saying, oh, like, you know, AI is going to take over humans. No, we're in a world right now where humans who are adopting utilizing AI, implementing AI will 1000% take over the humans that are like breaks are on. What's this AI thing? I actually, my wife always puts her hand on my hand. Like, you know, when the wife tells you to shut up, like, quietly on a daily basis, if we're out in public, because the first thing I'll ask, you know, are you an AI? And when someone says, no, I don't do AI or they they bark at it. Like, I can't be in that conversation because I'm now in speaking to somebody in history.

41:56Like, I'm not going to be speaking to you in the future because you're not going to have a life in the future and you don't even want to accept that. So I had a panic attack too. So I had the same panic attack and the same thoughts. And I was running away. I was so scared because I wasn't I'm not a technical founder, right? Like, I'm your high D high, I'm the sales guy. But when I made that commitment, wow, I would just say, wow, I'm still for a good time. I'm sure right now, man, history. Let me say this and then you got it. I believe we are now in the first time in history where the only limitation we have is the one we have in our mind. It's a magic. I just did a group interview yesterday for a bunch of interns. I love this. I love this. I love this. And literally I started the meeting with, okay, I'm talking to you all like your college grads, you know, so on. So they're all just like, hmm, like super eager. They just finished school last month or whatever. And I'm just like, look, I'm going to sell out and tell you, I'm so sorry,

42:58you spent all this money on tuition. And they're like, like, they're like, somebody who is just like, you don't like college. And I'm like, well, I'm going to say this. Like, I've got a bachelor's degree, four masters degrees and two doctorates. It's not about not liking college, okay. I love college. Like, I'm here to tell you right now that nothing you learned is in any way comparison with what you could learn if you just have the intellectual curiosity to want to learn it. Like, I'm doing 12, 13 people's jobs on a daily basis. And one of the jobs I'm doing is building robots to do other people's jobs. And here's my philosophy here. And this is, this is how I explained it to them. And I'm like, if you have an above average IQ and an intellectual curiosity, you can do anything you want in the world right now. There are zero limitations on what you can do other than time and

44:00imagination. Yeah. But it is a wide open field. And I intend to lead not follow when it gets into that space. And literally, that's our hiring criteria right now. Because the fact that I had a call with a recruiter who's recruiting a COO for me right now. And that's clearly a pivotal position. So, and she's like, I need to know everything about you the way you think, the way you behave. Like, I need all of this. Like, what are your likes, your dislikes? What are your Colby scores? Your Myers-Briggs development. And I'm like, first of all, I can be an ass. Like, let's be honest about that. And like, but here's part of my problem. And I spell all this out. And I'm like, I, because she's thinking, well, you need a person who's this and this and this and who's who's done. And I'm like, I don't need a person who's ever worked in an ad agency. I don't need a person who's got 30 years experience. I don't need a person who, you know, wears a suit to work every day. I don't care. I want someone who is smart and intellectually curious because there is

45:02zero limit to what anybody can do today. And there is just an entire culture of people who are still baffled. And they're like, oh, you're so smart. And like, nope, I just know how to use the machine. I love the intellectually curious. You have to, and the key word is there is the curious and I, and I with you because an intellectually curious smart person, guess what they will do. Take over the world. Well, I was going to say they'll figure it out. Yes. They'll research. If they don't know, they will go research deeper and harder than you and I ever will research and become experts in it in faster time than you and I will ever become fat experts in it. And you've lived your career. I guarantee you the same way I have that is you say yes and figure it out. Yes. Every opportunity I had was something I didn't know how to do. Right? You, you, you, you hire me to do something. I'm like, can, can you do it? Sure.

46:05Like, and as long as I figure it out before you figure me out, we're good. And by the way, you got what you paid for. Yeah. As long as I figured it out and got the job done, it's irrelevant to you if I knew how to do it when I said yes. And right now, I've lived my life that way, you know, and always figured it out, which again, praise the Lord, I just got a good brain. I'm very happy about that and I do whatever I can to keep it in good shape. But here's the truth. That opportunity is available not just to the super smart people nowadays. It is available to anybody with the intellectual curiosity, even people with lower IQs. But here's the point of all of that. AI is not taking away humanity. I believe that AI is giving humanity permission to be humans again. Because we have spent decades behaving like robots in the workplace. And we're actually required to be humans in the workplace now because the only reason to have

47:09humans is because they do something that robot can't do. And too many people, particularly college graduates, because they've been trained to, I mean, people who get A's in school are not out taken over the world. I would argue to say most of your audience didn't get straight A's in school because straight A students are conformists. Yeah. I couldn't agree more. Well, what's the big saying they say, which is really true? The straight A students work for the C&D students. Absolutely. Because the straight A students learned how to follow a system. The C&D students learned how to survive. And the reality is that the A students aren't the people I necessarily even want. That's the rub in all of this is trying to figure out that I don't need the people that everybody thinks I would need. But when I say the humanity, I'll say this, and as any interview I have, I'm like, around here, everybody knows what I mean when I say 10, 80, 10. And I kind of stole some of that from Mike Canig, but the 10, 80, 10 logic is that

48:14in a backtrack 10 years, 10 years ago, I came to work. My boss had done 10% of the work before I got there because the KPI was determined. The leads were generated. All of that stuff existed on my desk. My job was to do 80% of the work throughout my eight hour day and give the work to somebody else to review to decide if that work was appropriate or not. If it was, it got shipped. If it wasn't, I did it again tomorrow. The problem is, is I'm not hiring that 80% anymore because now I need you to understand what the 10% is and people call that prompting. I look at it as I need to actually have a clear scope of the work I'm looking for. AI is going to do the 80%. My job picks back up at the end of the AI's work because now I need to decide if what the AI did actually make sense. If it's applicable to the situation, what's the most appropriate way to human to human,

49:14deliver it to a client? Like, I get to be more human. I get to strategize. I get to have relationship. I get to have meetings. I get to think and marketing, not about RoAS per se. I get to think about human behavior and purchasing behavior. I get to spend my time doing the things that only humans can do like use imagination. AI is leaning on history. I get to spend my time in the future now where AI can't be because it can't imagine it data aggregates. I could go out in this whole day. Sorry, Caitlin. I'm just going nuts here. I know. I knew we were going to get taught and I love it because you just even, I just got a moment where I realized what you're saying and it's so many, well, employees of these A students, these employees, they come in and they're working in the system all day long. They're working in the system and the business owner, when you're starting out of a business, you're always working in it and you're always here. Are

50:18you working on your business or in it? No. Now we're living in a world where every employee can actually work on the business because the AI is working in the business. Now it's not just the entrepreneur working on the business. It's every employee can actually have the strategic thinking, the intellectual curiosity, as the mundane work that you should take forever and waste eight hours a day is now done in 10 minutes. And here's the deal with fewer people but the same top line. Those fewer people can be rewarded with the same pool of money that the larger group of people used to have to share. I couldn't agree more and I hope business owners hear that. It isn't about trying to cut the cause, make more money for yourself. It is how can you get instead of having 200 people? How do you have 20 rock stars that are working 10 different

51:18jobs using AI and being handsomely rewarded for that? Handsomely rewarded. Yeah. I won't iron anybody unless they use AI. So I tell them like if you don't use AI, I had a developer that I would brought on and I said are using AI. They're like, how do you think we've been communicating? That's great. How do you get your attention? I said, Touche, you're higher. AI rates half my emails. Right. I know. Does most of my research work? I spend my entire day. This weekend because I felt behind I had a bunch of travels and stuff and just just you know the day to day stuff fell behind and it's like this weekend and like that's Saturday Sunday. I'm committing myself to being in the office early morning to late night all weekend by myself. At the end of my time, I actually estimated that the amount of work that I was able to complete from non-interrupted focus time got about a month's worth of work done.

52:19And I just said that like I can't believe my team came in on Monday morning and was like what in the hell? Because the amount of assignments and tasks and outputs and this is what I need and data dives and just because I literally like I've got not only my quad that I've got my GPT because I use them for different things. I've got an army of quad bots that are autonomously doing a hundred different things and I'm literally just having 16 conversations. I mean I laugh and say you can see the big glass wall behind me. I'm going to get a grease pen and it's going to look like the beautiful mind. I'm going to like Russell Crowe this thing in a second. But they literally just the amount of human output and none of those things would happen if I weren't human. And it's me understanding buying behaviors. It's me understanding the creative process. It's me understanding that when AI gives me an output and says well on this landing page it needs to dot dot dot and like no I'm a human and that doesn't speak to me.

53:22We need to do that again and again and it's not that I pushed a button and a bunch of output came out. It's that AI everyone refers to AI as a tool and my team knows it's a hands-smack if you say tool when you're referring to AI. AI as a collaborator. A collaborator. Like this is a collaboration. It gives me input. I give it input back. It gives me more. I give it more. A tool is an input output. And it's like this isn't an input output moment. This is a shared analysis and shared synthesis and it's opinion versus opinion versus opinion until we get to a point that we both agree. And I'm collaborating. It's like a group project where everybody's participating for the first time. And it's like this needs to be a collaboration because you have the world's greatest collaborator with 135 IQ and a PhD and everything. Yeah. It's it's like I say we can keep going

54:22because that was the other thing too. I was just talking to somebody. I think I actually heard it the diary of the CEO, great podcast by the way. He was saying there was an expert there going like I if you are hiring someone who's at a grad school you might as well hire and this is where we get to that whole AI taken over you might as well hire an AI agent because an AI agent is as good as somebody with four or five years of experience. So now it's about how you know that's the biggest issue that's happening is how are these kids that have no experience? How are they going to be able to get the five year experience that they need that I'm looking for now before I hire anybody and the way you do it and this is why I said don't buck is go become an experienced AI prompt engineer and watch how your life will change. My chief of staff I say that I've often said that if anybody was like me when I was hurry it's hard. I don't say because I was always into like

55:26too curious it didn't matter like I was disassembling just to see how it was built. And it's like she kind of has that although I'm very extroverted and she's very introverted but she's one of those people where it's like I will pass a project along it should be like okay and then go about doing it the next thing I know she's running the world from a from a Mac Mini and yeah what in the world is going on and it's like I've got a full-time AI innovation manager who it's like that team just spends their day developing things now at our office I'll give this away I'm going to be jealous if everyone else does it like we're using a lot of like clawed bot type stuff so we've got security guardrails all the other kind of stuff but they're all on Mac minis so one of our things that we laugh about is like every Mac Mini we've personified all of our robots yeah so every Mac Mini has a name every Mac Mini has a personality we build the personality into it so when you get an email from a co-worker co-worker has a name and all of the

56:29names actually have Mac in the name okay so it's kind of funny because like our meta media you know our our meta manager his name is Connor McRigger but he always emails with an Irish accent yeah yeah like an angus McGyver does Google research and Leonard McCoy writes writes medical blogs and like just because we use this whole army and it's like I'll say that we used to do the work work in the business but our business now is it's a smaller group of people at the top that are plain puppet master like we're just helping steer them they're there the subject matter experts we're reviewing their work we're watching them we're pointing out anomalies that they may have missed because you know this like if you edit your own work you do a terrible job but I'm really good at editing other people's work yeah yeah yeah I mean I love it because this stuff used to scare me but

57:32now I like yeah I spent six months just all in attitude and everything you're saying is like yep greed doing that everything like that set up in the business that I'm running right now and you have to so for those of those for those that are still here listening they want to learn more how they can maybe work with you if you have an e-commerce brand buy out any commerce brand I know where I'm going but for those that may not know where they're going or working with maybe an agency they're not so happy with how do they find you yeah so I will tell you the easiest way to find me is through my own website which is the mark young dot com easiest way to find my books everything about me the mark young dot com social man handles Instagram I'm just the mark young and then the only reason I have that is because I bought it before my dad did because he's got the same name so that's even more confusing my agency's name as I mentioned is rise agency are why z e agency dot com you're welcome to take a look at it but reach out to me I mean go to the mark young all my social handles and everything are

58:34there reach out love to talk to people I just in love chit chat about this stuff and we are actually waiting for this literally this book series was supposed to launch two three months ago and this is going to be terrible but we did the entire audiobook recording because we're going to be giving away free audiobooks um the audiobook all of by did the entire recording the editor mailed all of the notes and usps lost the edits oh yeah damn host of us so the the the audiobook added is taking longer than expected but here we are well mark thanks so much for being here appreciate the wisdom and all the knowledge that you brought I appreciate it buddy great connecting thank you