Noah Norman launched nootropics brand Plato earlier this year, and shares a lot about his marketing strategies, and the his marketing funnel. Supplements are traditionally a very competitive niche: there are lots of competitive alternatives, there is a steep learning curve and product education, and also limited marketing channels due to regulations on where you can advertise and what you can say. - What Noah would do differently if he were to start a supplements company today? - Where he is prioritizing his marketing efforts - What he does to improve the retention of his existing customers
HIGHLIGHTS:
2:10 - How to find the right language and customer objections
6:37 - The Plato unit economics and how it works with paid marketing
8:45 - Customer retention strategies that Noah is using
12:33 - Marketing limitations for supplements companies
16:01 - Marketing advice for positioning for those starting in the supplements category
Links:
Instagram - https://www.instagram.com/thinkplato/
Gen Furukawa: [00:00:00] so going back to this, you launched it in 2017?
Noah Norman: [00:00:04] No. I started working on in 2016. I incorporated in 2017. The I launched in January of this year.
Gen Furukawa: [00:00:11] Okay. Okay. So then between 2017 and 2020 was all basically product development and finding the right ingredients and co-packer and whatever packaging, yeah. Cause I, I saw it online on your site and I think it's unique, not a lot of brands. I'm not that familiar with nootropics or just nutritional supplements in general, but like the transparency that you add on the site in terms of the batch, like the batch testing and results, and then even the co-packer itself, you share on your site, which is unique, right?
Noah Norman: [00:00:48] It's probably unusual for nootropics to share testing, to do testing, honestly, like it's a pretty fly by night segment.
There are supplements companies that, that make third party testing available. The, I mean the rabbit hole goes crazy. Deep testing itself is an apples to apples. Like if I were satisfied with the type of testing that my co-packer even would be satisfied with. it would not the actual information that the customer needs, but there's so much information that a customer needs to understand why testing is even important, much less, what kind of testing is important and what that tells you and what you need to look for that. I was wrong at the beginning of this process, in that I thought that everybody would be like me and we would like really want to know absolutely everything about absolutely everything.
Cause I don't take stuff unless I've spent honestly like a couple of weeks looking into it, like, and I take very little, and this was a process of me spending more than a year and a half, like looking into these ingredients before I took them and then making the product that's been another two years, you know?
So it was like, I, I was wrong. I thought, I thought that that was the kind of thing that the customer cared about. I would still have done it anyway, but I just, like, I thought that that was going to be the obstacle to convincing customers to adopt the product. But, the obstacles are somewhere else.
So we're doing customer surveys. We send them out this morning actually to start to better understand what people's objections are and how better to speak the language of a specific custome instead of speaking, generally to everybody. And mostly focusing on, evidence-based objections because those are only some people's objections.
Gen Furukawa: [00:02:31] Yeah. They're there they're really thorough well-researched and frankly, what my head like I, as in, like, I try to understand, I can understand that the headers, but then once you start mentioning some specifics, then I'm a little bit lost. Cause I don't know the difference. And so I'm probably maybe one of your typical customers who wants the angle of better focus, memory, cognitive, cognitive function.
But I might be willing to cut some corners in terms of testing, or I just don't have the rigor of research or knowledge to understand like what's good or bad. And that's what I really like about what you've done on your site is just the simplicity of ingredients that like are four ingredients, right.
Three of which are plants. So relatively easy to understand, but I don't know where like the proprietary part comes in because you're so transparent. Like. what Plato has versus another competitor that's selling online. I'm trying to like, I can't quite pick up the difference on how it would look. So I'm curious how you, you address that as a challenge in selling the, which everybody I think would want.
And then the methodology that you get there without being too overwhelming with science.
Noah Norman: [00:03:45] Yeah, I don't have a good answer to that because our conversion rate is terrible. So I don't know how to speak that language broadly in a way that works yet. I am working with a conversion focused copywriter who has a lot of experience in supplements, and she is doing the foundational research now to begin to understand from the customer's words, how to do that.
and so write more clearly and less cleverly and to use. Only the right amount of jargon in the right places. you know, I think we, as a formulation and as a transparent product, have a whole bunch of differentiators that, I think the average consumer would care about, but they don't go at the very top of the funnel.
You know, you really need to lead with benefits. You see the word nootropic, isn't doing us any favors. I mean, trying to figure out how to drop it because people don't know what the word means. and it's handmade anyway, and it's got negative connotations from like, you know, when it listens shit like that, but there are these benefits that are totally backed up by science.
So the why the thing is what it is, you know, we can offer these benefits and then it's way further down the funnel. And you're still trying to. Get somebody to click that button that you get into things like, Oh, and by the way, if, you know, in case you're looking at our competition, you may not be real aware of this, but if you don't see third party tests, you can't trust what they say.
Oh, I was just saying you need a high, you know, those arguments work on a very high intent customer and that customer needs to be arriving at your site pretty low in the funnel. and typically you would recognize that from search, that would be like, this person is arriving from a search term, like. "Becopa extracts for focus", you know, or something like that. Is a fairly small market and pretty competitive. Like you're paying a lot for clicks with that much intent associated with them. And they convert at a higher rate and you have to do less work to, to convert those people. But the market itself is not at the point now where there are enough of those, that it is sustainable to try to grow a business on exclusively high intent traffic.
And I don't have the funding to go head to head with the established companies that are out there. On those high intent terms and try to outbid them and out convert them. it's just it's even for them, it's not a good strategy and they're making money hand over fist. You know, it's just not a, the market isn't like that.
Gen Furukawa: [00:06:20] Right. Did you raise money? Okay. So this is all basically out of pocket. So you want at least a hundred percent ROAS.
Noah Norman: [00:06:29] Well, no, I need a, yeah. Yeah. I need to, I need to about a two to one ROAS we need about 200% realize, I have about $22 to spend acquiring a customer and it gets me a 10% profit. That is in a pretty pessimistic, appraisal of my LTV. It's like an extremely pessimistic appraisal.
Gen Furukawa: [00:06:46] for one purchase.
Noah Norman: [00:06:47] It's if somebody buys the subscription, which is the cheaper product, and then immediately canceled, I can still make money on the 22.
but if I spend 22 bucks, I made a couple bucks that way,
Gen Furukawa: [00:06:58] We said that's where the $39 offer.
Noah Norman: [00:07:00] that's assuming an average order value of about 42. So that assumes that some people buy the 39. Some people buy the 46, but nobody comes back.
Gen Furukawa: [00:07:10] They spend $42. You've paid $22 to get them to convert. And you're basically, you're making what. That's 10% of $20. So like $2. Okay, profit, right, right. Yeah. Is that including paying yourself? Okay. And it's right now you have a designer dev team kind of like contract and then it's you doing everything at that point?
Noah Norman: [00:07:38] Yup. Yeah. I have a pretty. I mean, considering we bring in, I have a pretty serious SaaS overhead. but other than that everybody's contract, I end up shelling out a lot for contract work. Cause we're just still getting shit going. but I don't have anybody on retainer or anything. I guess my devs are on retainer, but it's like 25 bucks a month to just maintain the site.
So they charge hourly my designer, I do on a project rate and then other people I bring in on project rates, people like. SEO, search people, managing ads, CPC stuff. and this copywriter stuff like that.
Gen Furukawa: [00:08:14] you're still, probably not quite at the point where you have enough data, right? If you launch earlier, like let's say you have six months of data, ideally you have a subset of those customers that are still on the subscription from signing up. Right. So you might not know what your LTV is until that whole first cohort is kind of like expired.
Noah Norman: [00:08:35] It's true. And we do still have customers from the original set, we're about 20% churn. which I haven't done anything to, not nothing, but I have a whatever. Flow that fires. And Klayvio when somebody turns, but, you know, I haven't really done anything to optimize that I don't have a offer for that. I've been talking to retention engine, you know, who have like a specialized thing that does kind of a Monte Carlo and machine learning thing and try to figure out what the best offer is to keep people around at the moment they're about to churn.
I also have only done one thing in terms of trying to stem churn at the time of refill, which is that's normally when people are going to churn, you know, they get the refill notification, they get an email saying, Hey, you know, your, your next is coming. And the most common reason given for people canceling is that they have too much at the time.
They just, they're not taking it. Regularly enough and they're watching it stack up on their like, so in the email I have my dad's build in a pair of links, one that delays their subscription for a week and one that skipped a month, smack that button in the email and it'll just do that on their behalf.
that could probably be optimized. it probably helped so churn, but there's plenty of things that you can do to, to reduce churn. It should be. You know, if I didn't, I don't know. I don't know if I had all the time in the world and I had, I had a lower if I had a smaller nut on my SaaS side. Cause that's kind of one of the things that adds to the ticking clock aside from just me, like losing my hair over this thing but anyway, if I had all the time in the world to do this in a very sustainable, small, get rich slow, like be careful, process, I would first focus on retention
actually. I don't have enough data to do that in a data driven way, but I would like put everything in place to retain existing customers first, then I would tighten up the bottom on the funnel and I would really focus on obviously my onsite thing, which is what I'm doing now, my email drip campaign, which is another thing that I'm doing now and my exit intent and stuff like that, which is another thing that I'm doing now to try to start to fill up the funnel and try to catch people just in that, in that like email sequence, bottom of the funnel thing just try to get people there and keep them that. Is the number one thing to do in my opinion, for a low budget ecomm project kit, the bottom of your funnel and get all the leaks out of the bottom of your funnel that you can at the beginning and hold onto the people that you had before you start trying to fill the top of the funnel.
Gen Furukawa: [00:11:05] so if you were to go back to say, end of 2016, you're like sweet. I'm about to launch this supplement company. And what I love by the way in terms of transparency is like for you, I think that there is authenticity because it's a family lineage, right?
I mean, Assuming that that was you, who was, yeah. So you like 130 years in pharmacy and, I guess I wouldn't don't know new nootropics, new, old tropics was a thing back nootropics. but yeah, I think that's a great story, but if you were to go back and in 2016, you had a lot of the idealism of getting a perfect product and then.
Selling it. Would you change anything in that approach then, like maybe do some of what your competitors are doing or just buy something that a co-packer was already making and then work on the marketing piece?
Noah Norman: [00:11:57] No, I would not do the latter. Definitely. There, there are a million tactics available to me today, that would turn this business around in a heartbeat. and there were then as well, the ones to which I have a, ethical objection, I re I still not considering,
Gen Furukawa: [00:12:17] nice.
Noah Norman: [00:12:17] Honestly, if I could go back to 2016, I would say, if you're going to go to e-com, don't do a supplement, you know, like to bootstrap a supplement business is pretty quixotic. Like it's not ecom in general is not that easy. Supplements it doesn't get a lot har really doesn't like in terms of overcoming customer's objections, complying with regulation, being boxed out of a whole bunch of avenues that are available to you, like ads get rejected all the time, just cause it's a supplement, you know, PayPal won't let me use certain API features.
Cause it's a nootropic. I can't send samples. I can't sell abroad. You know, like. It goes, I need to hire compliance experts all the time, but like look at things and make sure that I'm not breaking laws. You know, like there's everybody says there's a tremendous upside in there somewhere if you do it.
Right. But like increasingly I'm realizing that the tactics necessary to, succeed are closer to gray than, I would've loved. And, You know, just doctors and nurses and things. I mean, I'm not talking about anything, super nefarious, but like, there's a good margin on the product, but like, there's a good margin on lots of products that can be selling a piece of shit, plastic, you know
Gen Furukawa: [00:13:28] Yeah. That's where I think when, when you mentioned caffeine, you know, I think of like detox tea, I think it's called, but basically, you know, you add maybe one or two ingredients and then you can position completely differently. And so if it's like a detox. Or if it's caffeine and caffeine is like a diuretic or something, right. So it, or appetite suppressant
So it's, it's maybe good for weight loss in that sense.
Noah Norman: [00:13:56] I suppose you could say that. Yeah. I haven't really looked into like marketing for weight loss or caffeine. So I don't know, but maybe,
Gen Furukawa: [00:14:04] Yeah. Okay.
Noah Norman: [00:14:05] but I hear where you're going with
Gen Furukawa: [00:14:06] I spit balling just on like, Oh yeah, you're an ingredient here or there and the appeal is completely different and then the, and benefits are different. And then you're kind of targeting a different market, maybe, you know, less, less perceptive about the ingredients that they're taking and not really sure, but I think what you have is a really interesting copywriting and marketing challenge to visualize like what the benefits are. Because like I said, I, especially in the quarantine, I think my focus in my, my mood is definitely be been impacted and not positively, just, you know, the routine.
Noah Norman: [00:14:41] I instinctively built Plato without knowing how, supplements marketing works. I built it the way that you should build a supplement that you want to market, which is to say I started from clinical trials looking for effects that had been clearly demonstrated and then put together ingredients that are designed to as closely match the ingredient used in the club trial as possible in terms of the dosage and the potency and the constituent components of the actives in it, which is something we don't even get into on the site. Cause it's even further down the rabbit hole, but the ingredients are really meant to, to match the evidence that says that this does this.
And when you do that, you then in the eyes of the FDA are on a very good basis. You have strong standing to make specific claims this as a benefit to working memory, this can improve mood, you know, you can be specific. and anytime you add an ingredient, you can do that. And so when you go with a white label product from a manufacturer, or if you go through somebody who's a formulation consultant, which is something that at this point I could fucking do because of what I've learned, but you, are probably working backwards from the claims that you want to make.
And this is what I tell people who are starting up with supplements is like, figure out what you want to be able to say about it. What are the effects that you want to get? I mean, this is intuitive, but, and then find the ingredients that have demonstrated those effects in clinical settings. And that will give you the structure function, claim, substantiation basis that you can use to legally say those things with the FDA.
Gen Furukawa: [00:16:21] Yeah. And then you're not going through your own proprietary tests and you can basically just take previous tests off the shelf, you buy it or whatever, and
Noah Norman: [00:16:29] yeah. Yeah. So, I mean, that's another benefit to using branded standardized extracts as I do, because the brands, the companies that make the version of the standardized extract that I use have done lots of trials on the exact product that I'm using.
And again, and this is what I did just intuitively from the very beginning was I was. How, you know, getting all the studies together and look at the studies and all right, well, you know, again, and again, and again, I see these strong results in studies on backognice specifically in synopsis and keen mind.
Let me look at these three versus one another and figure out which one I should be, including in my formulation, based on the evidence and, you know, That set me up. When I went and hired a compliance expert to go and pull together a claims file that I went registered with the FDA to say, these are the things that I'm going to say about my product.
I'm like page and my marketing. That was a, it's a very strong claims file. I have like more than 31 claims in my claims file that are very specific about things because this product is exactly what is in these very strong studies. so if I were to go add an ingredient, it would be like, if I add caffeine, what can I say?
Gen Furukawa: [00:17:35] Yeah. So Noah just wrapping up. Biggest challenge, and the biggest skill that you would focus on that you are focusing on right now, you said earlier is like bottom of funnel working with what you have specifically. What would that be?
Noah Norman: [00:17:58] Person me, that's the stuff that I have my hands in right now. I have someone on contracts who delivers in like mid August. Who's in the middle of the ongoing process of competitive analysis, customer research and repositioning the brand based on that stuff and rewriting the copy on my PDP and on my homepage, which I will then use to inform not only my email work, but ads, going forward. and I am doing a little bit of CRO stuff on the site as well, just to, I don't actually think that like the function of the website is the, is the conversion rate problem, but, to whatever extent I can. You know, introspect, for example, the language in the shopping cart, you know, and make sure that it's very clear that you're not going to get hit with shipping in the next screen and, you know, stuff like that.
I'm looking at that stuff a little bit too, but again, I don't have the volume to AB that stuff and I'm not on Shopify plus, so I can't really, maybe at any way. so those, those are the main things is all at the bottom, trying to get there on the site. How do I get them through.
Gen Furukawa: [00:19:02] Yeah, that's super helpful. Noah, thanks so much for being so transparent and insightful and like inspiring really for doing it. And I wish you all the best. It's goplato.com. Yep. And are you on Twitter or LinkedIn
Noah Norman: [00:19:20] Yeah, we have @thinkPlato on everything.