In this week's episode, we are joined by Gil Efrati, CMO of Resident. Resident was, at one point, the fastest growing e-commerce brand in North America, and in this episode, Gil explains exactly how you get to that size and scale.
Gil has an incredible perspective on the role of data and why being “data-led” is really not a buzz word for Resident but an executable strategy.
Hear about how Resident leverages data in their creative campaigns and how brands can differentiate themselves in this crowded space.
Mentioned:👉Make America Sleep Again
Scratch is a production of Rival, a marketing innovation consultancy that develops strategies and capabilities that help businesses grow faster. Scratch is hosted by Eric Fulwiler, and in this episode, he’s joined by Gil Efrati, the CMO of Resident.
Find Rival online at www.wearerival.com, LinkedIn, Twitter.
Watch the video version of this Podcast on YouTube.
Find Gil on LinkedIn
Find Eric on LinkedIn and tweet him @efulwiler.
Say hi at media@wearerival.com, we’d love to hear from you.
Transcript
Gil: Up until IOs14. Everybody was you know, had two eyes and everybody saw the same thing. After iOS 14, everybody's blind. We're the one eyed man.
I'm Eric Fulwiler. And this is scratch, bringing you marketing lessons from leading brands and brains rewriting the rulebook from scratch for the world of today.
Hey everyone, my guest today is Gil Efrati. He is the Chief Marketing Officer of resident, resident is a challenger direct to consumer, although they do do some retail as well. Mattress brands, you might not have heard of them. However, a couple years ago, they were actually the fastest growing e commerce brand in North America. So Gil's background, he was the head of ecommerce at Google. He was there for many years. He's an active investor in some top tier e commerce startups. So for anyone in E commerce, this is absolutely a must listen. However, I really think for anybody, because what we get into and what is a little bit different than some of the other conversations we've had on Scratch is, you know, I think it kind of focuses on this idea. And what he says at the very beginning, that resident is actually a data company that happens to sell mattresses and as you hear Gil talk, and get a peek inside how resident and the marketing function actually works, that's going to come to life for you in a fascinating way. So he talks about how everything gets tracked, everything gets measured, everything gets focused on the return on adspend. That it delivers, he talks about how they have one of the healthiest media mixes in the industry. And actually they do their ad budget planning completely differently. There actually is no budget, they work on what he calls a cap model, where they can spend as much as they want, as long as it returns a certain percentage of revenue for every dollar spent. So there's a lot of very different and very progressive, very exciting thinking in what Gil talks about and what he's doing at resident I really think you're going to enjoy this episode. I definitely did. So without further ado, Gil Efrati of resident Hey, Gil, how you doing?
Gil: I'm good, how are you?
Eric: I am good. How are things down in Israel?
Gil: You know, sunny, getting a bit colder. But you know, 20, something degrees still can't complain?
Eric: Nice. Well, I really appreciate you taking the time. I know that we talked, you know, we're recording this in December, we talked first over the summer. And I was just fascinated by the story and some of the stats that you shared about what you've been up to at residence and the whole group of businesses that you're involved with. So I'm really excited to hear more about it today and share it with our audience. So let's get into it. If we can start with the question that we ask every guest, can you tell us about a brand that you're very passionate about right now? That's not your own? And why?
Gil: Oh, that's a good question. I think me as the CMO and a person who is very, very much into the day to day of marketing, I'm actually pretty fascinated with liquid death, and what's going on over there. Over the past year, I think they've done you know, I can relate a bit because we sit we also sell kind of like what you would call a boring utility product, right? mattresses are typically boring, but they are very important to you same as water, and kind of going into that space selling water. By purely, you know, differentiating on the marketing side is, is phenomenal. I think what these guys are doing over there is is really great.
Eric: It's amazing to the tune of a $700 million valuation and their last round, which is interesting. We'll see how that works out for the investors. But it is incredible what they do. I mean, they want to kind of default examples that we give. And it's interesting, because we you know, we talk about traditional brands, and then there's challenger brands like a liquid death. And then we talk about rival brands, which for us are challengers that have been able to go mainstream to truly change and redefine the category that they're at. And so it's interesting with a liquid death because they are probably one of the elite definitely in their category, the leading beverage CPG brand out there in the US. Are they going to be able to take that and flip it into a rival brands become the new incumbent within their category or, you know, a lot of these challenger brands struggle because they're so pointed with their differentiation, the way that they get attention. The way that they build equity is this disruptive gorilla. It's hard to rep it's hard to scale, you know, and it's hard to appeal To the mainstream. So I think I think they'll definitely be an interesting one to watch. It's great, great shout out. So we've got a lot to get through, certainly more than 30 to 40 minutes of time will allow, but let's just dive in. So starting with talking about and liquid death is a perfect segue differentiation. So differentiation, as we talked about a lot, and I know you're very passionate about is a key component when it comes to building successful challenger brands. So I guess where I want to start is, and you kind of mentioned this already direct to consumer mattresses. It's a super crowded category that's had its struggles over the years, you know, up here in the UK, Eve, just went into administration, Casper, a lot of people have talked about the struggles that they've had after a very hot start. So what are you doing differently at residence to make it work?
Gil: Yeah, so I think it comes down to there's like the differentiation and your go to market approach. And then there's the differentiation in the eyes of the consumer. Right. These are two different things, I think the biggest differentiation we have in how we operate and how we run the company is we consider ourselves a data and marketing company that just happen to sell mattresses, and over the years we've invested, we've over invested in data infrastructure that allows us to do performance marketing, at the highest level, I would say, almost ever been done across any e commerce business. And unlike, you know, other companies that have raised a lot of money have went towards like land grab by just putting a lot of money into building a brand. And assuming that you know, that brand is going to last forever. And you can wind down that brands spend over time and just keep your sales. We've always been through that model of every dollar you spend needs to be justified on a standalone sale basis, with positive ROI. And I think that's what differentiates us from practically everyone else in the DTC space for mattresses from the business model or, you know, modus operandi sort of way. From the differentiation the eyes of the consumer, I would say that we talked about mattress as being you know, you spend a third of your life, you know, on your bed pretty much, but it's still a boring utility product, and people don't really understand mattresses right? You understand mattresses the way you understand carburetors, you just don't. And so we try to focus one on of course, explaining and conveying that, you know, our mattress is as good or better than anything else out there. But also we try to enhance the perceived value that you as a consumer is getting, we focus on the offer. And the deal that you're getting is, is the best you could when you're talking performance marketing that is very, very important to communicate that.
Eric: So I want to I want to pick up on something that you said so the, you know, data and marketing business that happens to sell mattresses heavy focus on performance and return on adspend or return on investment. What does that mean for Brandon? I know we're going to talk a little bit later on about creativity and data, the art and science of marketing. But I'd be curious within that, because to me, and obviously I'm oversimplifying it to kind of make a point and be slightly controversial to what you said. But if sales is short term, cashflow, to me brand is long term cashflow. It's about building the awareness and the equity for future purchase and return. And I think that a lot of businesses struggle to invest properly and brand if they are always looking for short term, short term return on everything that they do. And so I believe that all marketing should be measured, but not all marketing should be measured within a 3090 day return on adspend. window. So is there some nuance to how you talked about it? Or is it that black and white? And if so, how do you think about building brands?
Gil: For sure that that is a great question. So my answer to these questions typically go first towards kind of like getting that question back to you. Let's say I have a successful profitable business that is fueled by performance marketing, that performance marketing allows me to spend over $250 million a year on marketing on media, pure media, it could be anywhere, okay? That alone the ability to be able to afford that level of spend, allows you to build a brand. That is that is answer number one. And then the second part of that answer is How do you utilise those $250 million using you know, creative that really tells a story about your brand. And it really kind of tells the customer who you are and what you represent. But it all starts with the ability to just have a very large marketing budget that reaches out to a wide audience. I think that's number one. The other pieces, we have a very, we work in a very unique industry, you only come into the mattress buying cycle every you know, different surveys say different things. But typically, it's about seven years, okay, some say five years, some say 10 years, the average is about seven years of between, you know, buying a mattress and another mattress, etc. And so I won't say that the value of a brand gets kind of diminished when we're talking about such such long cycles. But I can tell you that the importance of putting your right the right ad to the right eyeball when they are in the consideration phase when they are in market, that is the most important thing, I can build very high brand awareness now to 99% of the population who are not in the market for a mattress, it would probably not do me any good, especially because this is a product that is boring. So it's not like you're gonna remember, Oh, I remember this mattress brand. Because when you're not in the market for a mattress, you really have no attention for mattresses. So I think some of it is because of the uniqueness of the industry and the category. But I really believe that performance marketing is what allows you to also build the brand just by spending a lot of money behind it.
Eric: Super interesting, I feel like we could take the whole interview, just to talk about this. I'm gonna I'm gonna have to pick between the follow up questions, I want to ask that because I know we're gonna need to move on to the other topics. But it's really interesting hearing you say that, because where my mind went, you know, because I don't know if this is the right. I don't know if there's similarities between, you know, mattress, the mattress category and b2b but as a b2b marketer for the last business where I was CMO, and now also with rival, we think a lot about a similar perspective on our market, which is, and there's a lot of research and stats out there. But one of them that I throw out all the time is 95% of b2b buyers are not in a purchase cycle at the time you're trying to reach them. And so a lot of what we do with quote unquote rival media, our content and events, is build awareness, build equity, with marketers, who might not be probably aren't looking to hire a consultancy right now. And we do that solely focused on adding value to them through the content and the experiences that we create. But of course, we believe over the long run that's going to drive growth of our business. But I guess the difference is that you said people who aren't buying a mattress aren't interested in mattress content. marketers who aren't hiring a consultancy are probably still interested in marketing content. So that's one of the big differences. So what about I guess the other follow up question for me is, you're spending over $250 million dollars a year on performance marketing. Now that wasn't always the case unless you started the business with very deep pockets. And so was brand kind of a this probably isn't a fair way of putting it but was it something that you thought of as like, hey, eventually we'll get there. But really, it needs to be focused on direct response conversion was a kind of a secondary priority. I guess in the beginning or even still now.
Gil: I think in the beginning for sure. In the beginning, for sure. You know, you want to get when you start a business you want to get that that feedback loop from customers, you just want to get as many customers as possible you want to kind of they're your guinea pigs at first, right? You want to get as many customers ask them what they think about the product about the brand etc. And the brand is something that you kind of you flesh out over time, unless you are unless you've already started the company just thinking about the brand and you have like a very unique angle for the brand. Here this business started off very much bootstrapped by by the founders and so the goal was just to sell mattresses and get traction. Over time as you become a bigger and bigger company, you know, we sell for hundreds of millions of dollars we have millions of sleepers, daily that sleep on our on our products. Of course, you want to care about the brand things that you could afford to do in the past. From you know, how precious your brand is. You cannot do today. We've had a few years ago, we're a tiny company, but we've had a Facebook ad that did really really well it had a typo in it and the reason Why did very well is because a lot of people engaged with it, you have a typo. A lot of people commented You have a typo, you have a typo, you have a typo. Facebook says, Okay, this is a good ad. I don't know why but people are engaging with it, they share it, etc. When you care more about the brand, you're not gonna put an ad with a typo in it right, that ad would be immediately removed and and would be replaced with something else. So it's something that builds over time.
Eric: So fascinating. So what So what about, you know, if for category like yours, where at least from a consumer perspective, there's a lot of commoditization for the product, you know, this mattress to that mattress? And if you're not, you know, how often do people actually buy mattresses, you're probably not educating yourself or interested in educating yourself about them. And so I know what the traditional model, a lot of it had to do with the salesperson at the showroom that you went to. But how do you think about differentiation? Within this category? It sounds like a lot of it has to do with the performance marketing, with the data and that analytical capability and sounds like cultural DNA within the company. But how else are you thinking about differentiation in the category?
Gil: Yeah, so I think when, when our founders started the company, there were another 120 DTC mattress brands over then it was like Casper was educating the market, everybody said, I can do it too, all you needed is a credit card and find a provider that would send you a container from China, and you would have your own mattress brand. Right? It was that simple. And I think what our founders did, which was extremely smart, is they looked at all the value propositions in the market that typically revolve around. Risk, right? So you want to, you know, people don't want to buy a mattress without feeling good, or touching it or trying it out. So how do you de risk that, so Casper, D rested by giving 100 Night trial. So we decided to give 365 nitrile. Casper gave, or other companies gave 10 year warranties, we gave forever warranty. Right. And in addition to that, there's always like the value proposition proposition of like price, or total value. So we give out free pillows and sheets and mattress protector. So you buy the product, and you get everything you need. And instead of needing to attach this product and that product and eventually end up with with a much larger basket size. So it's no, it's a very transactional, you know, like just offer offer offer. But in the early days, that is what what has worked for us. And that's kind of like how you differentiate when there's like a sea of sameness, when the product is, you know, people don't understand it. So what do you need, you need to de risk it for them. And you need to make it compelling from an offer perspective.
Eric: So I want to take the conversation down a level, because we've been talking about what you do, what has made resident, the success that it is, but how you actually do that if we can kind of look inside the machine, open up the hood, slightly slightly. So you talk about being a performance marketing data lead company, what does that actually look like, in terms of the day to day, within your team and within the business right now?
Gil: Yeah, so before resident, I joined resonant after seven years of Google and I was fortunate enough to see a lot of different internet companies, whether b2b b2c e commerce, FinTech, whatever, and see what what they do well, what they don't do well, and kind of tried to take the best practices from each and but I think the common thread for all of them was really about the use of data and the way they leverage data. And for us, it's even more important because of the long buying cycle. It's over $1,000 purchase, right? You do your research, you research across different channels. And it's extremely important. And connecting those data points gets even more important because it's a long journey. And because you do that across different channels. And so for example, on Amazon, there's a very robust device graph. Why? Because it's an app and you're signed in, right? You use it all the time. So Amazon knows if you're on your mobile device, or on your desktop, device, etc. So building attribution models is easy and stuff like that. When your mattress company, no one logs into your website, there's no username, there's no password. It's very hard to understand that device a and device b belong to the same customer. And we were able to build the data infrastructure that we can At two or more devices to a significant number of our customers. And so that allows us to plot the user journey across the different devices and really understand the user behaviour and the user journey. And that in that allows us to really build a very healthy media mix, we have the healthiest media mix in the industry, we're not, you know, 90%, or 50%, or even 30% on any individual channel, and we spend money on every channel possible. And we can still map out that journey to understand where the customers are coming from, where is the marginal return on adspend? The best, where should we spend the next available dollar, and that concept of the next available dollar works really well with our business, because we don't work on marketing budgets, we work on a cap, I can spend X percent of every dollar that I make, I can keep on spending. So as long as that marginal dollar hits that criteria of that ratio, I keep on spending. And that's how you become that's how you get to like crazy growth, right? Because you're not capping yourself in marketing spend. And when things are going well, you spend more and when things are going not as well, you can lower spend and conserve cash for later. I think that's kind of like what made us what we are.
Eric: That is super interesting. I actually have not come across that before. I'm sure there are businesses I've worked with and talk to that do something similar, but at least in these conversations that hasn't come up. So maybe we can to the extent that you can share a just be curious how that actually works. So basically, there's a percentage of every dollar that you bring in from marketing, that you're able to just kind of spend freely is that? Is that a return on adspend metric? Or is it? Is it an overall ROI metric for marketing, like including salaries and overheads and things like that?
So it's only media, only media even creating? Makes sense. All of that is extra?
Gil: And do you do you run your media in house? Or is it with an agency all in house, it'd be much harder to do that, to use that model.
Eric: : If it was out if it was out of house, I'd imagine.
GIl: And also, you're given the margin.
Gil: Exactly. It's it's, it's both that it's both like building that institutional knowledge and using the tools. But also it's about accountability and about coordination between the channels. Eventually, we have an extremely talented VP of acquisition that he's like, and he runs an orchestra, right? He says, Okay, this channel needs to spend less, this channel needs to spend more based on the internal modelling that we have, we have homegrown models that were built by our data scientists. One is a medium mix model, and one is a multi touch attribution model. And in between these two, we are able to really understand the marginal return on adspend for every channel, and when do we need to just spend more on a specific channel? Or when do we need to move money from this channel to that channel? That's kind of like how the magic happens eventually.
Eric: So how does it let's take like an annual planning cycle? I don't know if you've gone through one now or just went through one. But do you have to submit a marketing budget that then you can go over? Or under depending on the performance of the media? How does it work within the planning cycle and the budgeting that I'm assuming the rest of the business needs to do?
Gil: Yeah, so what we've built is that the data and the marketing organisation or one organisation, all of them are reporting to into the CMO, which is pretty unique. And so we work pretty much as an agency we get from our CEO is the CFO, what the business objectives are from a top line bottom line perspective, on a monthly quarterly, annual basis. And we need to hit that with the limitations of the spend to revenue ratios. The beauty of it is that our data team is able to predict revenue ahead of time, based on market demand and stuff like that. So we can say we actually the data team helps senior leadership in determining what the targets should be, if you know from from the start and then that those targets go get trickled down to the marketing team and, and below that.
Eric: That's fascinating. And it's interesting, too, you know, recording this in December. So the episode that went out two weeks ago was with the CMO, or actually She's the Chief Marketing and Data Officer at at BMO, a big bank in Canada. She's the only other person and she's got it literally in her title but The only other organisation where I've seen data roll up to the CFO. So maybe that's becoming, maybe that's becoming more of a thing. So Gil, the other thing I wanted to touch on as part of this chapter in our conversation is iOS 14. So many ecommerce businesses have really struggled post iOS 14, with the privacy changes that have gone into place and the decreased effectiveness for many of them, particularly from Facebook and Instagram and social digital media. How are you? Or how have you adapted to that?
Gil: Yeah, that's a great question. I think that's like the billion dollar question for a lot of companies. Because I've seen great DTC companies that were very reliant on Facebook, that really kind of like crashed and burned once the platform became even like, 10%, less effective, right? Because it can crush your margin and your business, I think we've been fortunate enough to, you know, it's not like we knew to predict what's going to happen, that Apple is going to launch these privacy limitations, but the, the infrastructure that we've built, allowed our channel managers to understand channel performance, without even looking at in platform data. So our channel managers don't really care what Facebook says the CPA is, or what Facebook says, is the performance on each individual campaign or ad set, our internal systems tell the channel managers the like, the true performance of, of every, you know, every ad set and every campaign. And so yes, Facebook targeting has, has been dinged a bit and it's getting better over time. But one of the biggest limitations coming out of iOS 14 Is that marketers couldn't really understand what's going on. Right? Facebook will tell you this campaign is performing well, when in effect, it's the other campaign that was doing well. And if you're relying on only on any platform data, which again, 99% of companies, that's what they do, they don't have any other tools to do it, then your performance gets hurt. For us, I can say that we have actually benefited from it. Because if you think about it, you know, up until I iOS 14, everybody was you know, had two eyes. And everybody saw the same thing. After iOS 14, everybody's blind. We're the one eyed man. Right? So yes, we, you know, everybody had a harder time with iOS 14. But when you have the tools that we have, then you're not as being well, while your competitors are severely impacted. So, you know, it turned out well for us. But I've seen a lot of businesses that have struggled, even outside our category. And in other categories.
Eric: It's amazing. And I would imagine that the data being a data company that sells mattresses, having data at the core of the culture capabilities, I'm assuming that that doesn't just affect marketing, I'm assuming that's affects product and probably distribution and supply chain and all the other elements as well. Obviously, this is a marketing conversation, but just my mind went in that place of how much of an advantage it is not just for marketing, but probably every capability.
Gil: Correct. And it starts from, you know, from the top or CEOs are very data driven. And every that's kind of like part of the pre qualifications. To be a leader at the company is you need to know how to work with data, you need to like it, you need to make your decisions based on that. And we are big believers in democratising data. So everyone has access to data. And if there is something that you're keen about knowing what are your interests, or you feel like could could make the difference for the business, you will get the data that you need to make the decision. And we don't just encourage it, we kind of forced that culturally. And I think that's what makes us successful across the entire business.
Eric: So let's talk about the other side of the fence. A lot of this conversation is focused on data. Let's talk about creativity. So clearly, you're a data led company. So I guess the very broad question is, how do you think about and leverage creativity within marketing for President?
Gil: Yeah. And so that's a great question. And, yes, you when you're a company that kind of like worships data and worships performance, then it's very easy to not care about anything else. Right. And that might have been true in the year one of the company or year two, but now that we're at a very big business and we're the market leader, then you care about about that that aspect, especially because we spend So much money in marketing, then you want the marketing to, to tell the story that you want it to tell. And good marketing means having an engaging piece of content to show the audience and it couldn't be UGC, Facebook or tick tock add that, you know, it has one definitive definition of engaging, it just gets you to, you know, stop scrolling and watching it even if it doesn't look polished or amazing. That's kind of like how UGC looks like. But it can also be, you know, on ads that we run on TV or YouTube that are more long, for more polished, we've had two extremely successful campaigns that have won awards, like YouTube ad of the Year Award and stuff like that we've had the Make America sleep again, that features Donald Trump and Kim Jong Hoon, before they weren't even kind of like, like, we knew how to kind of predict the future. So it was before that that actually happened. And our latest one from a year ago is about not trusting commercials, right? Don't trust commercial trust reviews from real people. So we made fun of a lot of the cliches that ads lie to you or show you. And these are, you know, if you haven't seen it already, these are ads that I'm not objective, but they're hilarious, right? They're funny, they're engaging each other as like over a minute long. And you can just one of my one of the things that I like doing after we launch one of these campaigns is going to YouTube and seeing the comments on the ads. And it's like people are, you know, really writing this the best ad I've seen, I went back and searched for it on YouTube just to find it again, to show it to friends. These are, you know, things that really make everybody feel really, really good about about the creatives that we put out there. But we also take a very data driven approach to that. So every ad, when we shoot it, we will invest in another whole shooting day, just to make sure that we have all the right variations so that we don't put all of our eggs in one basket in case that storytelling didn't work out from a performance perspective, we need to have a DR version of it or two Dr. versions with the same concept, the same, you know, overarching concept, but it's much more hard sell much more performance oriented. And you know, so it's always a combination, we always want to de risk, you know, these productions cost a lot of money. And a lot of thought goes into it. And you know, everybody gets excited about it. So we try to kind of like enjoy the best of both worlds when we when we look at creativity.
Eric: So that was actually going to be my follow up question, which was not in the script. So it's funny that you went there. Anyway, I was going to ask what role does data play in the creative process specifically, but I think I can take another angle to it, which I'm curious to hear your response to. So there is the and I think that's fascinating and actually pretty unique. I think in my experience, I can't, you know, been a part of a lot of creative processes and production shoots and things like that. And of course, you're looking for different shots, maybe different snippets. But I think specifically, specifically the Hey, If this approach doesn't work, let's shoot a different one. I don't know if I don't know that. I've seen that yet. So I think that's really interesting. But what about in the actual ideation process coming to the idea of what the campaign is going to be the Make America sleep again? Or the one that one you the YouTube ad of the Year award? Was that an entirely subjective creative process where it was you and the creative director from an agency being like, yes, that's awesome. or was there some data and how you got to the creative idea itself.
Gil: So when we decide to launch one of these campaigns, that typically what we call them 360 campaigns because they, that campaigns gonna get a treatment for each individual channel, different shoots, you know, Facebook needs to be vertical, you know, everything, you know, you have UGC version, like 360 campaigns, a campaign that we over invest in, it rents for a long time. So when we go down that route, typically it starts with ideation. And the ideation is always looking like every good piece of creative it starts with an insight. Right, you know, like, what is that insight into mattress buying process that that, you know, people care about and which which would get the ad to resonate with them. So for example, make America sleep again is all about what your brain is like when you're not getting good sleep. Versus when you when you do get good sleep, right? That's like that's an insight right? When I don't sleep well, I'm agitated. I'm you know, I don't think very well I'm underperforming. And you know, when I sleep well, then I'm a whole different person. And so we take that insight. We write a script to it and we try it weave in performance elements within that script. So that the script is consistent and coherent. It involves both the value propositions, but also a story that makes you want to watch it all the way through. I remember in the Make America sleep again, it's like a two and a half minute ad. And at some point, the the, the presenter says to the camera, oh, my God, you're still here. Right? Because like, it's getting people to watch an ad for over two minutes is, is pretty challenging. And I think, you know, in our second campaign have commercials lie or don't trust commercials. The Insight is, okay, I'm going to buy a mattress for $1,000. All these commercials promise me, you know, the world. But I know not to trust commercial. So what should I trust? So I should either trust real reviews from real people, or I should trust the three hundreds, I should trust myself and take the matches, that gives me a 365 night trial to decide if I like it or not. And so these insights are what makes the story and then we try to build the the actual ad into it. That makes sense.
Eric: Yep, it does. And so what about the measurement side of the creative equation? So how are you I know that you're very focused on ROI ROI is, but are there any other kind of more brand metrics that you're focused on? Or value? Or is it all about the bottom of the funnel?
Gil: So we, as a data company, we measure everything, right? Of course, we, me as the CMO, I'm definitely not for, you know, doing something that can be measured and just say, Oh, well, it's a brand exercise. If I if I, if there's nothing that is measurable about it, then I can't even call it a brand exercise. Because if I can't even measure the brand metrics of it, then, you know, what is it good for. But as a data company, we measure everything. So we measure of course, row ads, and, and you know, sales oriented stuff, we also measure, search demand for our brand. And we measure brand awareness, both aided and unaided. And typically, it's not just about the creative, right, let's say I have an amazing creative, but I spend $50,000, in promoting it, or I have a so so creative, but I spent $20 million, promoting it, which one is going to get you higher brand awareness which one's going to get you higher, aided unaided awareness, which one's going to get more demand for your brand, and which one's going to sell more? It depends. But so you got it, you got to feed the beast, with with media spend, you know, Regardless though, we try to measure all of it. And we, eventually, the people behind every initiative need to show what what this garnered, right? What what did we what did we do out of it, and not all metrics are going to look favourable, but if some of them are, then we're gonna need to decide, okay, this is good enough, or we need to do another run at it, etc.
Eric: Yeah. But as a as a first principle, it's about having that information. And before you do anything, knowing what information you're looking for, and setting up the system, to be able to actually get it. Exactly. Yeah. That's fascinating. So, Gil, I'm gonna let you go because we are coming up on time. But before I do just one question to wrap it up. And I have a feeling I know the direction this is gonna go in. But if there's one thing that you would recommend people do differently, after listening to this episode, based on your experience, based on what's made residents so successful, based on the conversation today, what would that one thing be?
Gil: I think, you know, it's pretty clear that you know, owning your data, controlling it first party data, especially right now is becoming key. But I think, you know, when I look at a business, I always start actually, with the unit economics marketing is only part of the economics, right? Gross Margin is part of it, lifetime value is part of it. And when you talk about data, you don't even need to have like this intricate infrastructure, this crazy infrastructure that would allow you to have your own device graph and multi touch attribution models, just track the core metrics that make the business think 8020 Right. Track gross margin, try to improve it, track marketing performance, try to improve it. Track lifetime value and retention and repeat. Try to improve that. That's like the 80% that that that's like the 20% that make the 80% work. So I think that's kind of like what the guiding principle for me
Eric: love it. All right, well, that is a fantastic Place to Land to kill. Thank you so much. If people listening want to check out more about resident or potentially connect with you, where should we send them?
Gil: LinkedIn definitely, or just go and buy one of our mattresses.
Eric: Perfect. All right. Well, thank you so much for making the time. Really appreciate it.
GIl: Thank you, Eric for having me.
Eric: Cheers.
Eric: Scratch is a production of rival. We are a marketing innovation consultancy that helps businesses develop strategies and capabilities to grow faster. If you want to learn more about us check out we are rivals.com If you want to connect with me, email me at eric@wearerival.com or find me on LinkedIn. If you enjoyed today's show, please subscribe, share with anyone you think might enjoy it. And please do leave us a review. Thanks for listening and see you next week.
