Warby parker presentation to IPO last week it was one more sign that direct-to-consumer e-commerce (DTC) is an extremely powerful e-commerce trend. But the Los Angeles-based performance marketing agency MuteSix He didn’t wait that long to build his business around expanding the DTC brands.
Created in 2014 and acquired by Dentsu in 2019, MuteSix was recommended to TechCrunch by Rhoda Ullmann, VP Consumer at Sense, a Boston-based startup that builds a home energy monitor. “They demonstrate best-in-class experience with Facebook and Google’s paid ad platforms. They also have a very smart and efficient approach to creative development that was instrumental in helping us scale, “he wrote. (If you have growth marketing agencies or freelancers to recommend, please fill out our survey!)
In addition to Sense, MuteSix’s past and current customers include companies such as Adidas, Petco, Ring, and Theragun, to whom he provides a full range of marketing services, including top-notch direct response videos. But regardless of whether you can afford this, we think you will learn interesting lessons from our conversation with your CRO. Greg gillman. The key to take away? In today’s highly competitive advertising environment, both content and data are king.
Editor’s Note: The interview below has been edited for length and clarity.
What can you tell us about MuteSix as an agency?
Greg Gillman: We have been around for nine years. We started out as a Facebook ad agency, unlike many agencies that start out by saying they do everything, we decided to focus on what we were really good at. At the time, I was buying media on Facebook for e-commerce businesses. Mainly here in Los Angeles, which is kind of a hub for these companies, but also everywhere. And then, little by little, we grew the organization.
At this point, we’re just over 400 people and managing over $ 500 million in spending on Facebook and Google, including Instagram and YouTube. We have become a one stop shop for DTC eCommerce companies – we manage all the channels a DTC brand needs. And we are an acting agency; everything we do is based on results. People come to us to generate income from their e-commerce businesses.
Why do you think performance marketing is right for DTC?
DTC entrepreneurs are more focused on immediate impact, because if they are not selling products, there is no big brand behind them. So I think doing DTC marketing requires you to focus more on performance. For agencies that work with big brands, it’s generally more about buying impressions than buying performance. You can say: I did an outreach campaign today to hit 10 million eyeballs, and whatever happens, happens, because at the end of the day, you just told us to make 10 million impressions. It’s different than working with a group like us trying to optimize every little part of the funnel and be responsible for the entire funnel to generate the most sales or revenue.
What type of clients do you work with?
Most of the companies we work with are digitally native DTC companies. Most of the time we have stayed in that lane, because we are very good at it. That said, we work with companies of all sizes: startups, companies that are already established, and very large companies that need to rework both their creative and media buying strategy.
I oversee sales, marketing, and partnerships, and my role is really trying to figure out which brands make the most sense to partner with MuteSix. We look for high-growth brands that we can scale, and over the years we have learned that what works well are demonstrable products that have attractive user values.
We have worked with many startups at different points in the funnel, starting from scratch and working with them through various rounds of funding, right up to acquisitions, including two by unicorns. But these days, the ground is more difficult. I like that they have some proof of concept – investing between $ 10,000 and $ 15,000 a month on Facebook or $ 5,000-10,000 on Google usually shows me that you have some life. But I don’t want to limit ourselves if it’s a good idea. I talk to a lot of people who come back once they’ve had a little taste of it.
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What kinds of clients are definitely not a good fit?
It won’t fit if there isn’t a real unique value proposition for the product. If it’s just another run-of-the-mill business, a consultant may charge you less money and set up Facebook ads, but what we’re looking for are high-growth businesses.
The compensation for our campaign managers is actually tied to campaign performance, so if I bring in a bunch of campaigns that we can’t scale, we’ll have a lot of disgruntled media buyers asking, “Greg, why are we taking on this brand? “It’s a business model that has helped us attract top talent, but we need to make sure we bring in brands that we think we can scale.
And it’s easier than ever to start a business, but now it’s harder to scale it past the $ 2 million to $ 3 million execution rate. So I always ask the founders again: What are the five reasons people want to buy your product? What are the five reasons why they don’t? If the entrepreneur has trouble answering this, it won’t work. If they can’t tell someone why their business is good, then we won’t be good at selling it.
How is MuteSix different from other agencies?
I’d say the main difference is that we have an in-house video creative team of 70 people; And what we’re really good at is filming and creating performance content. Not just content that looks and feels great, but videos that are designed in reverse to sell products.
Another key component is that we have a full data science team that is also integrated with our media buying team, helping businesses navigate things like attribution and signal loss due to the iOS 14 update. Right now, that means focusing on looking at the whole picture rather than per channel and working on mixed model attribution.
What are some of the things your data team is focusing on?
One of the biggest things brands struggle with is figuring out attribution and how you continue to spend money even though you may have lost some signal on the platform. If Facebook leans too far and Google is on the last click, sometimes things never seem to work out. To help companies make informed business decisions, we are creating statistical models that display information at a higher level than the platform.
We are also building better customer profile segments that help customers understand who their primary audience is, but also help us build predictive audiences to find new people.
Another big thing that we are trying to solve is incrementality. We work with big brands that have a strong organic following on social media; and your question is, “Hey Greg, why should I spend more money if I had acquired those users anyway?” So we’ve done incremental tests with high-spending brands on channels other than Facebook and Google. We help them develop different ways of looking at the data so that we keep spending on those channels and they really know the incremental increase they are getting..
There is another piece that I think is very important and that is generally overlooked: the data itself. We work with brands to try to acquire as much of that source data as possible, segment it, and use it, because that’s what they would be left with if Facebook closed tomorrow.
How do you prepare for and adapt to changes in the marketing ecosystem?
Because we work with so many brands, we have a lot of senior leadership at every channel level. We meet routinely with all departments and share ideas. The data science team also creates pretty robust reports. We try to stay ahead of our brands and be forward-thinking about anything that ultimately impacts the agency. We are constantly trying to work our way through things like the types of content that work and the things that we know will help us scale.
This is how we have always approached it. All major changes in our business were made to respond to the needs of the brands we were working with. For example, there is a side of data in our business because it is more important than ever to use it. Facebook used to be a platform where you could throw anything at the wall and get a 4-5-fold return. Nobody asks about data when you literally print money from Facebook, right? It only happens when the margins get narrower. But then Facebook became a more crowded platform, and so did Google: more advertisers, a higher CPM, and a more competitive environment. We needed to get smarter with what we were doing, so we built our data team.
Now there are two levers that we can use: the data side and the creative side of the business. Once again, we are a performance marketing agency, focusing on all levers. Because platforms like Facebook will only get more competitive, they will only get more expensive and we will only lose more traffic. So the most agile agencies have to think much more outside of what we are doing on these platforms; because we’re going to offset the incremental revenue on things like SMS, influencer marketing, and organic content, to continue making money at the top of the funnel.
Why is your content arm so important as a lever?
We have an integrated solution where our media buyers are directly matched with our video editors and producers to allow us to be agile and fast; because as everyone knows, content is king. What we’re trying to do is optimize around things like what we call the approval rate on Facebook: three-second video views. If I’ve kept someone in your newsfeed for that long, I can potentially bring them into our flow. We do the same on YouTube, and we do things like this in programmatic, because the name of the game is to get people into the funnel and work with them. And we’re using both our data science team and our creative team to develop and optimize on the front-end around these quick metrics to get things moving.
In my opinion, there is no close second to an SMB agency that has a content arm like us. Leveraging our content team to create performance content is one of the biggest levers we have. Three and a half years ago, Facebook was telling us, “If you don’t create video content, and if you don’t prioritize video in your news feed, it’s not going to work.” At that time, we supported each other a lot, and the pain of growing a creative team of 70 people is real, especially in Los Angeles. But it has allowed us to scale our agency.