â
â
Ecommerce: Shopify [â our recommended eCommerce platform]
âEmail: Klaviyo [â our recommended email marketing platform]
SMS: Attentive [read our guide on SMS marketing platforms]
Attribution: Triple Whale and Northbeam
Domain: GoDaddy
Incrementality: Measured
Revenue Financing: Wayflyer
Subscription: Recharge
Reviews: Yotpo [read our guide on reviews platforms]
Gift Cards: Rise.ai
App: Tapcart [â our recommended app builder]
BNPL: Klarna
Customer Service: Gorgias [â our recommended customer service platform]
Click Fraud: ClickCease
Comms: Slack
Video Platform: Videowise
Affiliate: Social Snowball
Agencies: Narrative, TubeScience, 99Ads, & Quickframe
Post purchase survey: Knocommerce
Physical Retail: Leap
â
It's the call that Ryan Bartlett has been waiting for. The Northwest Michigan native had grown up in the small town of Cadillac with dreams of becoming Dr Dre. He went to college to study music and was now in LA hustling for his break in the music industry. The call was from a well known producer looking for someone with Ryanâs skillset. Ryan shows up on his first day eager to get into the music studio and instead is directed to the front seat of the producerâs car to chauffeur him around LA. He sat in the car that day for hours while the producer went around the city. Ryan did that every day for 9 months before calling it quits.Â
This type of tough break was nothing new for Ryan. After college, he went to Las Vegas during the Chris Moneymaker poker heyday with dreams of making it big in the poker world. He quickly went broke within three months and was walking down the vegas strip convincing partiers to take limos around for which Ryan would get a $25-50 kickback from limo drivers for each person he brought in. These hard knocks were all on the road to starting True Classic.
In the spring of 2019, Ryan got the idea for True Classic. He looked around the apparel market and felt that nobody was being intentional with mens t-shirts. The high quality, well fitting t-shirts from the James Perses of the world were charging an arm and a leg. Nobody was offering an affordable, high-quality t-shirt. The key insight was designing a shirt that was tight in the arms and the chest but looser around the stomach. Perfect for the millions of men with dad bods. In addition to fit, he also sourced the high quality, soft fabrics that were being used by higher end brands. His product solved three key customer problems: fit, comfort, and price.Â
Ryan bought the domain for True Classic on Godaddy in May of 2019 and launched True Classic with a $3,000 budget and a few t-shirt SKUs as a side project in August of 2019. It took off quickly. In its first month, it did 651 orders and $26k in revenue. He brought in co-founders Nick Ventura to focus on product and Matt Winnick to head up finance. In the beginning their ads focused on testimonial, UGC, and side by side content. Ryan found childhood friends and comedians Greg Auerbach and Nat Twer who go by Gregtube to create True Classicâs first ad that truly resonated. It used comedy to highlight their key value prop: fit. The comedy duo werenât creating ads for anyone at the time, but Ryan correctly sensed that if the pair could use their comedy skit format and incorporate True Classic the result would be mega. The ad absolutely crushed. Their normal ROAS was 2:1 and overnight it went to 9:1. This was a lightbulb moment for Ryan where he realized it wasnât about selling something first, but entertaining first, and selling second. The brand pivoted to go all in on comedy.    Â
The growth of the brand has been truly meteoric. Some think itâs the fastest growing DTC brand of all time. In its first year, the brand did $15M in revenue. It did $90M in revenue in its second year and $150M in its third year. Along the way it expanded its SKU count going from its hero t-shirt product into hoodies, underwear, and jeans. It also expanded internationally. International now makes up 25-30% of revenues and the brand is available in 190 markets. Along the way they brought in Ben Yahalom who started as a consultant and is now President of the company. Ben came from the Facebook Disruptors program, what some call the Special Forces of Facebook. There are 10 million paid advertisers on Facebook and 80-90 are selected to be in the Disruptors program. Ben says you are three times more likely to get struck by lightning than make it into the Disruptors program. Ben is incredible, and we highly recommend everyone check out his interview with Nik and Moiz on the Limited Supply Podcast.  Â
â
Start Small and Test the Core Value Prop đ§Ş
Ryan started the brand with $3,000. That budget went to developing the initial SKU and a small Facebook ads budget. Facebook provides an incredible testing environment where you can test your product for very little money. If the product is resonating, the ROAS should be clear in the early days. The True Classic value prop can be distilled down to a single sentence which can be tested in Facebook ads. True Classicâs innovation was a well fitting shirt that was tight in the shoulders and arms and loose in the torso to make average guys look better. This resonated. No amount of optimization after the fact can help a brand if that single sentence value prop doesnât resonate with customers. Spend time iterating on that value prop until you find something that truly works. Consumers are willing to purchase from companies that have terrible branding and horribly designed websites when that value prop resonates. No amount of spending on branding agencies like Red Antler will work if that core value prop doesn't resonate. The beauty of this is that Facebook is such a scalable platform that once you find something that works with a small audience you can scale almost infinitely.Â
â
Huge TAM + Incremental Improvement = đ¸
Apparel is an incredibly crowded space. Most âexpertsâ would have laughed at Ryanâs idea to launch a better t-shirt in 2019. What he did was actually genius. He took a huge category and came with an incrementally better product and was able to scale incredibly quickly. Two lessons here.Â
First, donât be afraid of crowded markets with large TAMs. With privacy constraints, Google and Facebook are evolving away from manual audience targeting and towards algorithmic targeting. This algorithmic buying favors products that resonate with large markets and hurts more niche products. Don't let existing competition in large markets scare you away.
Second, almost all successful consumer products are incremental improvements. True Classic didn't invent the mens t-shirt, they just made it incrementally better. This goes back to the the core value prop point earlier. The core value prop is the incremental improvement, and if that resonates in a large market, then you are cooking with rocket fuel. Itâs easy for critics early on to criticize ideas as âjust another xâ. Ignore them. As long as that incremental improvement resonates with customers you are sitting on a gold mine.  Â
Comedy + Product = đ
Comedy is really hard to do right, but when it hits, it does better than almost anything else. Comedy is all about authenticity. If done poorly, it will be cringe, but when executed well, it will sell your brand better than almost anything else. There are a couple of examples in the mens product space where a single comedic video launched a brand to mega success. The OG in this category is Dollar Shave Club who back in 2012 released a video with their Founder that launched the brand to its eventual billion dollar exit. Dr Squatch did the same with their mens soap video released in 2018. Liquid Deathâs deadliest stuff on earth video from 2019 is another great example. True Classic didn't invent this tactic but used it with great success in their Gregtube video. Shoot us an email if you can think of an example of this working for a female focused product. We think there is huge potential for a brand to do this.  Â
â
Laser Focus on Metrics that Matter đŻ
The True Classic team has a North Star metric: 2x blended ROAS. How did they get to this number? Some basic math is required that we flesh out below. Weâll take you through the math (no calculus - we promise), but first, we want to sketch out the philosophy. The True Classic team is laser focused on making sure that they are always breakeven on their first order. With this model, they scale for free (breakeven), and profit based on repeat orders. As they scale, they get more confidence in their cohort performance and can be more sure of repeat orders. They look at the customer email addresses and SMS numbers they acquire almost like balance sheet assets that will pay back over time.Â
The math:
Most companies look at ROAS (return on ad spend):
True Classic, however, wants to know what their target ROAS needs to be in order to breakeven. Letâs say they want to generate $100 in sales, how much can they spend in advertising dollars?Â
To answer this, they look at âprofitâ ROAS:
The team goes deep on profitability. They donât just look at a basic contribution margin (revenue - COGS) but look at a fully loaded margin taking into account all variable costs like payment processing fees, fulfillment costs, shipping costs, expected returns, and even the cost of customer care (expected tickets per order) in addition to the cost of the product.
True classic will spend up until break even or True Classic âprofitâ ROAS = 1
So for $100 in sales, True Classic can spend $50 (profit $ = spend $)
We then use algebra to substitute profit $ for spend $ in our original ROAS calculation to get a target ROAS
Essentially, 1 / variable profit % = target ROAS
Youâll notice that True Classicâs 50% variable profit % gets them to a target ROAS of 2x, but a more profitable business could have a lower target ROAS and a less profitable business would have a higher target ROAS. This method also works because True Classic is confident in the repeat rates that they see in their cohort data. This is partially driven by the category they are in, apparel, where there is a higher likelihood of repeat purchases. This model would break down with low repeat purchase rates (categories like mattresses or luggage).
How does the True Classic team continue to scale under the target ROAS constraint? They find breakthroughs. Creative breakthroughs, technology breakthroughs, landing page optimizations, etc. etc. Incremental improvements allow you to acquire more customers under efficiency constraints (target ROAS).
A final point is around attribution. If ROAS is your North Star metric, it would be easy to only put budget towards your highest last-click ROAS channels (branded search) and never invest in low ROAS channels like YouTube which don't generate very many last-click purchases. Instead, True classic also looks at post purchase survey data to make budget allocation decisions. Their post purchase survey asks âHow did you first hear about us?â and lists their channels as response options. They find that if they attribute based on post purchase survey data, the ROAS from YouTube goes from decimals (last click) to above 2x (post purchase survey). This is likely why the team has a 15x ROAS requirement for branded search. Â
Outsource by Default đ§
Whenever a business need isn't met, the company first looks for a software (technology) solution to meet the need. If no software solution exists, then they look to outsource (agency, consultant, freelancer). Finally, if no good outsourcing options exist, only then will they look to hire for it in house. True Classic looks to outsource by default. Hiring is slow and painful. Hiring and hiring mistakes are especially painful. This outsource by default mentality allows the True Classic team to move extremely quickly, operate leanly, and focus on the highest impact areas.Â
Focus on 1-2 Channels đŹ
When True Classic launched, they didnât attempt to optimize 5 different channels. They focused on one channel - Facebook. This focus allowed them to optimize and scale spend. Today Facebook still accounts for 50-80% of True Classicâs spend. The temptation is to get one channel âworkingâ and then shift your focus and attention to a new channel. Avoid it. The more spend and purchase data you can give a channel like Facebook, the better it will perform. Rather than splitting a small ads budget between two channels, focus it on one.Â
Stores are Shoppable Billboards đŹÂ
The team uses a similar approach to their retail strategy as they use in paid acquisition. The goal of the stores is to break even. They know that if they can run their stores at break even, then there will be benefits to their online business. They also know that 65% of people will only shop for apparel in person, and they are missing out on a large swath of people by being online only. They call stores âshoppable billboardsâ. In order to help the stores breakeven, they reduce the number one operating expense: rent. They haven't selected locations in tier one expensive shopping districts but instead chosen places that have more affordable rents. In order to select locations, they also used their online purchase data. They found that Chicago had the highest customer concentration and have 2 stores there. Theyâve also kept their outsource by default strategy and partnered with Leap to lead store buildout, hiring store staff, etc. They currently have 5 stores, and the plan is to prove out the economics of these 5 stores before aggressively expanding their retail footprint.Â
Receive email updates when we drop a new guide.