[00:00:00] Charles Tichenor: We have to stop thinking of Facebook as a PPC platform. It's not display, it's not programmatic. It's not email, you know, it's not an inventory or demand based platform. It is a user experience platform. What they don't realize is Facebook is the employee. You're the manager. The harder you work, the more you're micromanaging your employees, the more I micromanage an employee the worse they are.

[00:00:33] Jason Wong: Hello, everyone. Welcome back to another episode of the building books podcast. Today I'm joined by an exciting guest, Charles Tichenor, who is the founder of disruptive school. And you can think of them like Codeacademy for a digital marketing. And I can tell you from being here for so many years, something like that is absolutely needed.

[00:00:53] Jason Wong: Charles, welcome to the show.

[00:00:55] Charles Tichenor: Thank you so much, man. I really appreciate it.

[00:00:57] Jason Wong: Like a cold one?

[00:00:58] Charles Tichenor: Well, this is a Liquid [00:01:00] Death. That's where I'm rocking it today. You got to murder your thirst and I feel like, you know, we're going to be talking a lot today. I might as well wet my whistle.

[00:01:07] Jason Wong: Yes. Yes.

[00:01:09] Charles Tichenor: Mm. Thirst is definitely getting murdered.

[00:01:11] Jason Wong: That's a good ad. You should send it to them for a UGC ads.

[00:01:16] Charles Tichenor: I should.

[00:01:18] Jason Wong: Charles, I didn't get to meet you until recently in person. And you're so enjoyable to talk in person that I wanted to invite you to the show. A lot of people around the space know you as the Facebook guy, you're the guy who has spent an absurd amount of money on Facebook.

[00:01:35] Jason Wong: What's that number again? $3-400 million on Facebook spend across your accounts and your

[00:01:40] Jason Wong: students?

[00:01:41] Charles Tichenor: Yeah, something around 3 to 400 million right now. I mean, you have to remember that I have some stuff where it's a seven figure daily budget. You know, I might have a seven figure monthly, but sometimes it's eight.

[00:01:52] Charles Tichenor: I I've.. Nine years ago, I was overseeing Activision, Nissan, CBS, and Levi's. Like they had [00:02:00] eight figure monthly combined budgets. Like I, I would spend a million dollars a day for CBS on an average basis. So like sometimes DTC sometimes brand building. But yeah, the number is just absurd and I was just the right guy in the right room at the right time to be able to have that opportunity.

[00:02:17] Jason Wong: Absolutely. And you know, everyone's talking about Facebook ads this and Facebook ads that, and lately it's been a lot of negative sentiments because of the changes. And I don't want to just do another show about, oh, let's just complain about iOS 14 changes. Today I actually want to talk about, you know, some of your findings from spending so much money on Facebook.

[00:02:35] Jason Wong: You're definitely getting a lot more data than the rest of us. I also want to dig in on things like, you know, how do we combat the changes of Facebook as a marketer? Things are actually still working and I want to go into some controversial stuff. So some of your most controversial things, will dive deep into that.

[00:02:52] Jason Wong: But first off, I really want to ask you, like, how has Facebook changed today compared to two to three years ago? Like, does this still work [00:03:00] or does it just works a little bit less?

[00:03:01] Charles Tichenor: Yeah, I think Facebook, I'll say it's a double-edged sword. Number one, Facebook is smarter than it has ever been, which means that if we're using it in a way that leverages it, it's easier than it's ever been.

[00:03:14] Charles Tichenor: On the other side of that though, especially now you'll see a lot of controversy thrown around iOS 14 and tracking of information. As far as I'm concerned, I remember every day for years, I mean, I remember before there was attribution on Facebook, so. And then it was lovely that we had it. And then everybody complained about it took too much credit and now they're saying, well, we don't get enough credit.

[00:03:36] Charles Tichenor: And at the end of the day, business owners don't really care about credit. They care about revenue. So I'm not really concerned with feeding my ego as a marketer, nearly as much as growing brands and businesses. That all being said, what happened last year, more than anything, and is attributed to iOS 14, but it's actually way more tied in with the rise of TikTok, is Facebook made a very [00:04:00] specific point and they were very public about this, but I don't think it really registered with a lot of folks that they are prioritizing the end user experience more than they have in a very long time. So Facebook wants you to be happy with your time on Facebook and on Instagram. They're changing, you know, they said, well, Instagram is a video platform and we're prioritizing communities and prioritizing connections and experience.

[00:04:23] Charles Tichenor: And while iOS 14 came out the same time one of the big changes that we saw, and it was just a minor little shift, but because of machine learning, it has compounding impact, is marketers that don't prioritize the end user experience saw soaring costs on the platform. And those that did prioritize the way that Facebook users felt on the platform, basically those that cared about their business partners bottom line saw tremendous success. And as a, for instance, [00:05:00] I got a, I got a client, a student of mine from a Facebook ads MBA program. He runs women's print on demand jewelry in America. He was upset during Black Friday. Cause his CPMs went up by 50%, all the way to $16 and $18.

[00:05:16] Charles Tichenor: Most people I know, would love to see some CPM like that at all. And that was his super high like like super high, you know, competition, marketplace marketing towards women that aren't necessarily wanting to buy with jewelry, which everybody's trying to hawk. And in that space because his ads did the job of meeting Facebook's business objectives, he was getting ridiculously low cost of inventory. And so this is really playing into the idea of, we have to stop thinking of Facebook as a PPC platform. It's not display, it's not programmatic. It's not email. You know, it's not an inventory or demand-based platform. It [00:06:00] is a user experience platform. And the less you try to force your experience you want onto people, to try to extract money from them, the more you make Facebook's business objective of time on site and on app and consumer intent positive, the cheaper it's going to be for you to advertise and the higher the quality of the experiences, the options you're gonna win. At the end of the day, say, you really give a damn about the end consumer.

[00:06:34] Charles Tichenor: You're running heavily creative testing. There's a branding approach to it. You're running broad dynamic creatives, lowest costs. You're doing all of that stuff. And I'm working off of interest groups in bidding models and lookalikes and heavily retargeting things. Trying to do everything. I might have one or two ad sets that are way better than you were broad, but every month you're getting better.

[00:06:56] Charles Tichenor: Every month I have to work harder and harder just to [00:07:00] maintain the same thing, because I am basically making it more and more difficult just to stay afloat every month. And after a year, I'm probably going to struggle to stay on the platform. And you might struggle with funding because you ran out of money because you've been doing so much.

[00:07:18] Charles Tichenor: And I've had more people struggling, having to go to VCs early and inventory issues. Then I have people being priced out of the marketplace. When you align yourself with Facebook's objectives, and I think every platform, every business relationship works like that. You know, any relationship, honestly, if you had a friend that said this is what I need for me, if my wife said, this is what I need from you and my response was to give her the finger and demand money. We're not going to be in a relationship very long. And there's really no difference with Facebook. I just think that in the last year that's just amplified. Right?

[00:07:52] Jason Wong: Right. So what you're saying is let Facebook do its thing because it's just so much smarter than us.

[00:07:57] Jason Wong: And the more you try to work against it, the harder your life [00:08:00] will be. I, I mean, I I'm seeing, like the prompts are you're saying are usually good prompts for people like running out of inventory or needing more funding to scale. As most people, I will say listening to this and 80-90% of the people are probably like, man, I can't even get my Facebook to work.

[00:08:14] Jason Wong: And I'm quite curious to hear, like, why is that the case, like from your assessment, why does Facebook work better for some brands than the other, even if they do the same exact thing? Is there, is there a difference for how you can run Facebook ads for a brand at a certain AOV or a certain brand recognition versus a brand who is very well-known has a, has a large audience already. What, what is the different ways to approach these two type of businesses?

[00:08:39] Charles Tichenor: Yeah, that's a great question. And, and I've had the luxury because I have students and clients from all over the world and have been doing it for many years. I've had basically the same business come to me 20, 30, 50 times, like over the years.

[00:08:50] Charles Tichenor: Right. And that's happened all sorts of times. And, and what I can say is the most important thing in running your Facebook ads is the business. [00:09:00] I think more than anything outside of running Facebook side, but what happens after the click is so tragically undevalued. I've seen two businesses running, basically the exact same-

[00:09:13] Charles Tichenor: I saw two skincare brands run the, basically the exact same stuff, but they were literally sourcing from the same place. They were white labeling more or less the same product. And one of them leveraged influencer marketing, google, like search and email and made a lot of money or made a lot of profit margin, but had a really hard time growing.

[00:09:37] Charles Tichenor: And the other one heavily favored customer service and Facebook ads. And as a result, they ran at a much lower profit margin per transaction, but they run at a much higher profit margin per customer. And one of them went out of business in 18 months. The other one exited for an eight figure exit [00:10:00] in 26 months from founding.

[00:10:02] Charles Tichenor: So one of them was a $24 million deal. The other one fired everybody and closed up shop and, oh man, the big difference there is one of them focused on return on ad spend. Right and marketing efficiency. They were like every penny we get is supposed to bring in more stuff. The problem is if you're not feeding the pool and you're not generating return income then you ultimately don't have a business model built to scale.

[00:10:30] Charles Tichenor: And I want to give credit to Cody Plofker of Jones Road Beauty, who said something, on a podcast. And he said, you know, I think it was a Tweet or in a podcast, but he said a good business will scale an ad account. And I think I've tried to say that exact same thing for years and years and years, but sometimes just somebody saying it's so simple and beautiful, like you can't get better than that.

[00:10:52] Jason Wong: Quickfire question for you, quick fire answers.

[00:10:54] Jason Wong: What are the three things that you absolutely need to do right now to succeed on Facebook?

[00:10:58] Charles Tichenor: I think the three things [00:11:00] that I highly recommend everybody to do is one embrace broad as soon as possible. Remember, broad is a noun, not an adjective. It is age, gender, and location. Every bit of targeting you put on top of that ads to the cost of CPM.

[00:11:11] Charles Tichenor: Because ads do the targeting. That's an objective fact. So why not let the system find the right people? That in mind also I'm using dynamic ads as much as possible. Dynamic creatives are tremendously powerful. Keep them simple, make them actionable. Every spend should inform you, even if it's a win or a loss. What you need to do, let Facebook construct the end user experience in a way that is best for your business relationship with Facebook. And then the third thing I'd highly recommend is you need to simplify your offers and really figure it out. What is the most profitable customer journey for your needs right now? Do you have cashflow?

[00:11:47] Charles Tichenor: Do you, are you willing to invest in longterm lifetime value? Far too many people are running like three or four products, three or four offers. You can get to 20, 30, $40,000 a day on one offer. Right? I'm [00:12:00] doing one thing exceptionally well on Facebook also makes everything after the click so much better because all of your customers are coming into the same thing.

[00:12:06] Charles Tichenor: So you only have to manage one problem. And it's way easier to crush when you only have one thing to do.

[00:12:12] Jason Wong: Right. How important is a landing page, a custom landing page for running Facebook

[00:12:16] Jason Wong: ads?

[00:12:17] Charles Tichenor: I think landing pages are really important. I mean, at the end of the day, Facebook ads just get somebody in the door.

[00:12:23] Charles Tichenor: A Facebook ad is nothing different than a TV commercial or a billboard, but what happens when they step inside of your store is tremendously important. I would argue that, you know, Walmart and Kmart and Target aren't that different. They're giant stores selling boxes of things, but one of them is going to make you feel very different than the other one.

[00:12:47] Charles Tichenor: And one of them we're going to probably spend way more than the other, that experience matters. I live in LA and like we've got Vaughn's and we have Ralph's. I would rather go into a Vaughn's than a Ralph's, even though it's the exact same [00:13:00] stuff for the exact same price, because the vibe is different.

[00:13:04] Charles Tichenor: I don't think that I'm, you know, you might have your choice, but that stuff matters. So I think it's insanely important to measure and improve what happens after the click. At the end of the day, no Facebook ads going to fix a janky site.

[00:13:22] Jason Wong: Absolutely. In terms of creatives, you know, there is a time when one particular type of creative worked really, well, the direct response ads, or like the, as seen on TV type ads really, really, really well. For current times, based on all your accounts, what is that? What is the format that works really well for all the accounts?

[00:13:40] Charles Tichenor: I love that question because I think ultimately the answer is that there isn't an answer to that question. I would say every brand, like we're talking about the vibe, right. Of the landing page and the look in the field, every brand needs to create, like the purpose of your ad should be to develop a relationship and a bond between the [00:14:00] customer and you, and for some brands, that's gonna look like static images. For some brands that's going to look like user generated content. For some brands that's going to be video. What's most important is that you try to figure out what problem you're trying to solve and then design creatives to solve that problem. If I've got three UGCs and I'm doing really well, probably I don't need a fourth one.

[00:14:21] Charles Tichenor: I need a piece of content that somebody that's not going to watch a video is actually going to care about. So am I trying to be more efficient with my advertising? And if so, I'd probably want to solve the same problem, but better. If I want to scale my advertising, I want to try and make my ads appeal to different people because the ads do the targeting.

[00:14:39] Charles Tichenor: So if I want to spend more, I need to appeal to different types of individuals. So the right answer is almost always what is honest with your brand and what solves the most immediate need that your brand has? That being said? I don't, I'm not a believer in any type of one creative type of format does anything better than anybody else? Cause [00:15:00] literally anything can work for anyone. And I think we've seen competing brands, run UGC and static and they both work. I just think some stuff is exciting inside of the echo chambers that we might all exist on online.

[00:15:14] Jason Wong: I love it. And one final question, let's get a little controversial. What is a marketing myth that you're tired of hearing online?

[00:15:22] Charles Tichenor: Yeah, I would say probably the biggest myth that I want to really address and it's funny, Dora actually released like 10 hot takes and one of them I completely agree with. Is that the idea? I think, I think media buying as a skill as a job, as a career is basically dead.

[00:15:40] Charles Tichenor: If you are spending more than two or three hours a week on your Facebook ad account, it means you're not doing a good enough job. Facebook media buying is a feature to an overall employee. Like you have to be good at other stuff. Like my Facebook ads MBA program, I'm training. Basically everybody would be good at [00:16:00] Facebook ads and be a CMO.

[00:16:01] Charles Tichenor: Because you need to know that data, you can be a creative marketer. You can be anything else, but that's not a standalone skill that requires more than a few hours a week. So if you want to make a career as a media buyer, you have to understand that either you're going to be the person pushing buttons all over the place, or maybe decided to do the easy thing of taking some part-time work.

[00:16:23] Charles Tichenor: Three, four grand per client. You're pulling in a hundred K a year. Good for you. But very rarely is the idea of somebody who's a good media buyer versus somebody isn't what is way more impactful. If somebody is a really good creative --- strategist, or somebody is really good at being a marketing officer and understanding the media mix.

[00:16:44] Charles Tichenor: But the easiest way to buy ads on Facebook is go broad, use dynamic ads and focus on getting one thing. That doesn't take that much time. And I think [00:17:00] people are under the impression that hard work is a good thing in Facebook. What they don't realize is Facebook is the employee. You're the manager, the harder you work, the more you're micromanaging your employees.

[00:17:11] Charles Tichenor: You've managed people. I've managed people. The more I micromanage an employee, the worst they are.

[00:17:16] Jason Wong: I love that analogy. I've never heard of that before. It's a great analogy for Facebook.

[00:17:21] Charles Tichenor: Yeah. I'm glad. And I hope that it hits home with people. Like it's a factory, right? If you're tinkering with every step in the factory, you can't be really upset that it's not doing nearly as good as it could if they just figured it out and let it do it.

[00:17:33] Charles Tichenor: You know, I mean, we have factories with robots in them. Do you think the Tesla robot gives a damn about whether it's building a model X or a C or whatever? No, it does its job. Your job is to make sure that it does its job as much as it possibly can without you. Any business owners should be working at the greatest extent to make sure that that business is successful without needing them.

[00:17:54] Charles Tichenor: If you're not doing that, then you've designed yourself a paycheck. And I don't know about [00:18:00] you, but I don't build businesses so that I can have a nice paycheck. I build businesses so that I can solve problems and exit them and work on bigger things. Like if you're not thinking big, you're going to stay small. Yeah.

[00:18:13] Charles Tichenor: Your work ethic should go into everything else in the business. Not how do I make the best billboard possible.

[00:18:19] Jason Wong: I love that. Charles, those are extremely valuable tips you just gave. I'm so glad we had this conversation and that's a wrap for today's show. Thank you so much for coming on.

[00:18:28] Charles Tichenor: Thank you, man. I really appreciate it.

[00:18:30] Charles Tichenor: I, you know, I was a lovely to get a chance to meet you in person too. We got to hang a little bit and. You know, you're a very, very nice guy. And I know you do a lot of things behind the scenes to help people out. And I think that that is tremendous. And I really want to let you know that I appreciate those things.

[00:18:49] Charles Tichenor: I see stuff I won't call things out, but you definitely have a really good head on your shoulders and you are exceptionally giving with the opportunity that you've had. And I think a lot [00:19:00] of people are better because they've got you in their environment. And I think from where I'm sitting. That is the greatest gift that I feel the greatest thing anybody could ever hopefully say about me was that because I'm in their environment, they're better off.

[00:19:18] Charles Tichenor: And I think you're hitting that. You're hitting that home. And I don't know anybody that knows you that would disagree with that.

[00:19:25] Jason Wong: You're just, that was the biggest compliment you could have given me. Thank you so much.

[00:19:30] Jason Wong: You just heard an episode of the building blocks podcast. If you like, what you heard subscribe below to keep hearing conversations that I have with brilliant marketers, founders, and innovators on how they built their best ideas.

[00:19:40] Jason Wong: Now, if you want to learn how you can turn your best ideas and build something massive out of it. Visit my website bbclass.co or follow my Twitter @eggroli.

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