At the time, I was the CMO at Rocket Internet. We were obsessed with data. Excel was religion. We built companies on speed, execution, and numbers.

Then Global Founders Capital (our venture capital firm) invested in a small D2C luggage startup in New York called Away.

They were growing fast.

But one of the founders told me something that sounded almost illegal in our world:

“There’s only one person in this company with Excel on their laptop.”

Rocket’s CEO, Oliver Samwer, wanted to understand how that was possible.

He told me:

“Go to New York. Reverse-engineer what they do. Come back with a case study.”

So I did.

What I expected to find was some hidden growth algorithm.

What I found instead was a brand machine.

I spent a week studying their model and wrote a 10-chapter case study when this was happening.

Today, almost a decade later, I’ve digitized that original document and turned it into a D2C growth blueprint.

If anything, it matters more now than it did in 2016. Ads are more expensive. Tracking is worse. Performance alone doesn’t carry companies anymore.

I originally wrote this in the present tense, and I’ve kept it that way so you can experience it as if it were released today.

Here is the playbook.

Introduction

Away is a New York-based company selling high-end smart luggage primarily online, founded in 2015 by Jen Rubio and Steph Korey, two former Warby Parker executives.

With its first suitcases shipped in February 2016, the company reached $10 million in revenue in its first year.

Away’s impressive early-stage growth did not come directly from SEM, SEO, Facebook ads, or other performance marketing channels. Instead, it was driven by a mix of storytelling, PR, brand marketing, partnerships, influencer marketing, and an excellent product and customer experience.

After all, luggage is a commodity and the market is highly competitive. Moreover, the amount of high-intent traffic available online is limited. Beyond the carry-on’s tech feature (it can charge smartphones on the go) and price, Away chose to differentiate itself by building a brand and a community, guided by the idea that “any other company can create identical luggage, but no one can copy the brand.”

The drivers behind Away’s growth are summarized below in ten recommendations, followed by a conclusion:

1. Always look for opportunities to tell a compelling story

Funding and launch

Before shipping the first suitcase, Away had already been featured in nearly 100 press articles. The two founders, Steph and Jen, launched the company at the right time and told the right story to the media. Here are the key elements behind their early PR success:

• Away was not the first company trying to lower the cost of premium goods through a direct-to-consumer model. This is exactly what Warby Parker and Casper did in the eyewear and mattress industries, respectively.

• The founders’ backgrounds made them strong candidates to disrupt the luggage market. Steph previously served as Head of Supply Chain at Warby Parker, while Jen was Head of Social Media at the same company. As they explained:

• “While working at Warby Parker and Casper, we saw those companies completely transform the previously poor consumer experience and high prices in the eyewear and mattress industries. In January of that year, we decided the luggage industry needed similar improvements. So we created Away to offer consumers high-quality luggage at a fraction of the traditional price, combined with a great customer experience.”

• Both founders were named to the Forbes 30 Under 30 list, which helped drive additional coverage, particularly from tech and business media.

• Last but not least, a $2.5 million seed round co-led by Forerunner Ventures and Accel Partners further increased media attention.

The product

Beyond the launch and funding, the product features themselves made the suitcase highly appealing to technology, design, and fashion media.

• A built-in 10,000 mAh battery that can be charged in advance and power a smartphone up to five times during a trip turned the carry-on into a true smart suitcase.

• Four rotating double wheels, an internal laundry separation system that keeps belongings organized, a scratch-resistant shell, and TSA-approved YKK zippers position the luggage as a design-driven product.

What’s next?

Although funding, launch and product articles represent the vast majority of press coverage and help boosting brand awareness in the first year, Away was able to be on the top of mind of journalists by continuously crafting and telling compelling stories.

Below some examples of other stories that generated strong press coverage:

1. Packyourbag.co: One of the early PR hacks of Away (covered in one of the next chapters), was the website packyourbag.co. The e-commerce website (available for just one month) would allow visitors to drag and drop travel essentials from different partnering companies into an Away suitcase and check out. Visitors could either shop the products or participate a sweepstake and win all of them along with a trip. Beside generating a high amount of leads, a well told story to the press made a simple shopify website appear as the e-commerce of the future in the eyes of journalists.

2. The monogram edition: In April and again in December, Away assembled New York-based artists Scott Biersack, Jen Mussari, and Alaina Sullivan to paint up to three letters in a variety of colors on any of the Away Carry-On models for $35 more than the standard price. While the monogram edition didn’t generate a high volume of additional revenues, artists painting luggages was another great story for the press and Away achieved coverage in several “top gifts for the holiday seasons” articles.

3. International expansion: With a moderate investment, Away opened temporary stores in London and Berlin. Sales in the stores were not equally successful in both locations but the press considered the move as a sign of international expansion, which helped Away appear as a global brand.

4. Growth and funding: More obvious stories to tell are the growth and funding achievements. $10 million revenues, seed and series A funding all generate high coverage.

5. Limited editions: In general, both journalists and customers are attracted by scarcity and limited edition products always make a good story. Beside packyourbag.co and the monogram edition, Away produced several limited edition products, some of which covered in the next chapters.

Key press articles can be found here.

2. Amplify the reach of engaging stories with social media ads

The following two Facebook ads are the ones which generated the highest engagement of all time for Away:

Remarkable elements of these successful Facebook Ads

• The ads above act as a brand endorsement from Vogue and Fast Company. They give Away high credibility as a fashion and design company.

• High engagement. Not only the target audience is more likely to engage with an editorial from an iconic company such as Vogue compared to content on your website, but also you will be able to reach a bigger audience for a much cheaper price. $5 CPM, >5% CTR, more than a million people reached and a high relevance score are quite rare among companies. An ad with a relevance score of 9 has a CPM which is about half that of an ad with a relevance score of 5 targeting the same audience. Moreover, shares, likes, comments and tags can generate a high amount of organic traffic which is not measured on Facebook business manager or google analytics.

• These ads did not link to the Away website. Instead, they directed users to editorial articles, not product pages.

  So how do you measure the success of these ads in Google Analytics in terms of traffic and conversions? You don’t, at least not directly.

  You can track referral traffic from Vogue and measure the conversions associated with that traffic, but that will only show part of the picture.

  Is it still worth doing? Absolutely.

  Are there other signals that the article helped drive sales? Just read the comments below it. High engagement on a highly relevant article is a strong indicator that the content resonated.

  Of course, not everyone leaves a comment after buying a suitcase, so you cannot reverse-engineer the exact number of sales generated by the article. But strong engagement around a relevant story is a meaningful proxy for impact.

• These two ads are boosted posts and standalone ads in relation to the rest of the Facebook account. The Facebook account is structured along funnel and recency dimensions, from custom audiences to lookalikes, non overlapping audiences and oCPM bidding on the funnel step generating enough volume to properly calibrate the algorithm, just like most of the companies at Rocket Internet. None of the ads within the analytical structure shows by far the reach, engagement and CPM of these two boosted posts.

• Last but not least, pushing traffic to this article means supporting the Vogue editor to reach her own KPIs. Every editor cares about traffic and clickthrough rates for her own articles, because that’s how an editor is judged by her company / supervisors. The success of this article in fact led Away to secure free exclusive coverage from Vogue on the next partnership. This is something you don’t see on Google Analytics.

3. Create demand and urgency to buy your product

“The places we return to”

At the time Away sold its first 1,200 carry-on luggages ($270k of revenues), none of them were actually produced and in stock. Jen and Steph wanted to prove there was demand for such product but, in an effort to build a high end company, they decided it was not a good idea to do kickstarter, so they had to come up with a plan to generate demand and pre-orders.

It was September, the product would officially be shipped only starting from February next year and waiting lists wouldn’t work for a product that didn’t exist yet. They decided instead to create a limited edition travel book, titled “The Places We Return To”, and complement pre-orders with the book. This book would be stuffed with personal anecdotes and images from 35 notable world travelers, including Morgan Collett of Saturdays Surf, Tyler Haney of Outdoor Voices and Kelly Connor of Vogue, all interviewed by the New York Times writer Alexis Cheung. More contributors below:

Michele Ouellet, model and co-founder of Lorenza Wine

John Jannuzzi is the US Deputy at Twitter Moments

Adam Rapoport, Editor in Chief of Bon Appétit magazine

Marian Cheng, co-founder of Mimi Cheng’s Dumplings

Alice Gao, photographer based in New York

Not only featuring socially influential people in the book helped creating brand awareness within the social sphere of the contributors, but also it generated demand for the product and all 1,200 copies were sold fast.

Packyourbag.co

In May, Away joined forces with four direct-to-consumer brands to create the ultimate travel essentials online shop at packyourbag.co. Lasting for just a month, you could shop vacation selects from grooming company Harry’s, activewear line Outdoor Voices, and womenswear brand AYR, all packed inside the near-perfect carry-on suitcase from new travel brand Away.

Behind the scenes this is just a simple Shopify website, but a good story to the press made adding products from different brands to a travel suitcase appear like the ecommerce experience of the future.

Not only this out of the box partnership resonated with the press, but also helped Away collect 50k email addresses, by encouraging urgency to participate. In fact, users could either buy any of the products or participate a sweepstake and win all of them along with a trip (paid by the partners).

Pop & Suki Partnership

Pop & Suki is a fashion brand built by the model Suki Waterhouse (1.1 million followers on Instagram) and the tv presenter Poppy Jamie. Beside the influential power of the founders and the press they attract, the main theme behind Pop & Suki products is the color pink, a good opportunity to do co-branding.

Away will create 500 pieces of a limited edition pink suitcase set for Pop & Suki and Vogue obviously already accepted to have the exclusive on the coverage, for free.

On top of that, having a limited edition version of the product will fuel urgency to buy the product and those users who won’t be the first to buy it will eventually buy one standard product.

4. Don’t target your audience directly, partner with companies that are already an authority for that audience

One of the key growth strategies of Away is that of partnering with companies that are an authority for its target audience.

Instead of reaching its target audience directly with performance marketing ads, Away looks for established brands to partner with. Partnering with these companies helps Away to gain trust and credibility from potential customers.

These brands usually accept to partner with Away because of its ability to attract press and because of its influencer network (more in one of the next chapters).

Key partnerships include packyourbag.co with Outdoor voices and the partnership with Pop & Suki, as described in the previous chapter.

The first few partnerships were started by Away and took up to six meetings to be finalized. As of today, Away doesn’t have to source partnerships anymore as companies such as Tesla or the NBA ask Away to partner with them.

Aesop Partnership

Another example of successful partnerships is the one with the skincare brand Aesop. Through the partnership, Away got travel-size Aesop products at cost and included them in a gift set packed in a miniature case along with a pair of socks:

Many other brands asked Away to partner with them after seeing the Aesop partnership. Brand association is a fundamental part of Away strategy.

Violet Gray Partnership

To create brand awareness in Los Angeles, Away partnered with Violet Grey, Hollywood’s leading artists and stars selection for cosmetics and beauty products.

For only 24 hours in the last week of the LA Away pop-up store, Violet Grey customers received a free carry-on luggage for orders above $500, limited to only 20 pieces. At the same time, Away customers purchasing from the pop-up store received a Violet Grey travel set.

The deal was featured in Violet Grey website and newsletter (150k customers).

5. Be relevant and specific when approaching a potential partner or the press

One of the reasons why Away was so successful with the press and partnerships is the fact that it reaches out to the right people, with all relevant information and a tailored message.

The Away team researches who is the right person to cover each story and reaches out to that person directly offering a carry-on luggage along with all relevant information required for an article or partnership, including high quality images (fundamentals for journalists).

Below some examples of emails to the press.

Outreach email

Subject: Holiday Collection // Away

Hi Lucinda,

Hope your week is off to a great start! I wanted to reach out and introduce you to premium travel brand, Away.

We would love to send an Away bag to accompany you on all your future travels. If interested, let us know which color you prefer (navy, black, green or sand) and the best address to send. Additionally, I’ve included information on our upcoming holiday collection, launching November 15th, below.

For the 2016 holiday collection, Away launches two special edition colors that reflect the palette of the season--the stark matte of white Snow and the rich grey Asphalt. They capture the modern winter experience, no matter what you celebrate (or don’t): waking up after a fresh snowfall to see a city blanketed in white, quite and calm, set against freshly salted streets. Just #snowandasphalt, as far as the eye can see. Hi-res images of the collection are available here.

Look forward to hearing your thoughts!

Thanks,

Ben

Reply to inbound request

Hi ___,

Appreciate you taking the time to reach out—it’s great to connect. We would love to send you The Bigger Carry-On, let us know if you had your eye on a specific color. I will follow up later this week with your tracking information once your suitcase is on it’s way, likely to arrive after the holidays. I’ve included images for your use here, as well as additional information on our brand, products and founders below.

Let us know if there was a specific angle you were interested in pursuing as we would be happy to support in anyway possible (quotes from our founders, industry research, # suitcases sold, etc).

About Away:

Launched in November 2015, Away is a new travel brand founded by Steph Korey and Jen Rubio (both Forbes 30 Under 30 and formerly of Warby Parker). Our focus and inspiration is movement: times of transition, exploration, and surprise. We create special objects that are at home on the road—that carry you forward, making your trip easier, and in a small way, your life better. We started with luggage.

Our Founders:

Jen Rubio and Steph Korey established premium travel brand Away to design and make products with the needs of the modern traveler in mind. They first met in 2011 as early executives at Warby Parker where Jen served as the Head of Social Media, spearheading content and partnership efforts, and Steph as the Head of Supply Chain, where she was responsible for building and leading the team in product development, manufacturing, and fulfillment. Jen and Steph then went their respective ways, while Jen led Innovation at AllSaints and Steph earned an MBA at Columbia Business School while consulting for mattress startup Casper on merchandise strategy and supply chain, before teaming up in February 2015 to launch Away.

Our Products:

Our full line of suitcases include The Carry-On $225, The Bigger Carry-On $245, The Medium $275 and The Large $295—all available in our four evergreen colors; Navy, Black, Green and Sand.

Start strong

Inside: two compartments, one designed for clothes, the other for shoes, toiletries, and the other hard objects. Outside: an impenetrable shell that bends under pressure, never breaks.

Power up

The Carry-On’s built-in battery can charge any USB device so you’ll always be able to check your maps, email, or slack.

Undress and compress

A nylon laundry bag separates clean clothes from dirty—even wet bathing suits are fair game. Buckle down the compression pad to clear up free space.

Settle back in

When it’s all over, Away bags next neatly inside each other, ready to be tucked away for next time (and save closet space in the meantime).

TSA-approved lock

Two zippers slot into a combination lock, so no one’s getting into your stuff but you (and the TSA).

Smooth ride

Premium Hinomoto wheels rotate 360 for a perfect roll every time.

Scratch resistant

The matte texture surface deflects scuffs and scrapes along the way.

The project Emma

One example of specific outreach and storytelling is the project Emma. Emma, 23 year old Instagram influencer, was in charge of the launch of the pop up store in London. Following the success of the store, Away decided to bring her to New York to work with the rest of the team permanently at the HQ. Unfortunately, strict US immigration regulations make it difficult to bring such a young person with little experience to US, so Away decided again to look for a way around. After performing a research, it found a writer from Forbes (Wes Gray) who covers stories about successful millennials and decided to craft a story for him that would generate press coverage.

Although not public yet, you can find the story below.

SUBJECT: Meet the 23 year old behind cult luggage brand Away’s global expansion

Hi Wes,

Hope you’re having a great week. I’m reaching out from Away, the direct-to-consumer premium luggage brand that launched earlier this year. Since you’ve written so many great articles about millennials who are really making a difference in their companies, we wanted to tell you about our 23-year-old Head of Global Marketing and Operations, Emma Bates.

We’re excited to talk for the first time about our plans for global expansion and Emma as the driving force behind that expansion. Since joining us over the summer, Emma has spearheaded our aggressive international growth strategy. In particular, she has:

● Led the expansion of Away’s digital footprint to five new countries

● Opened pop up shops in our two biggest European markets, London and Berlin

● Increased brand awareness and sales in Europe by more than 20x

Away is planning to quadruple year over year sales in 2017, and international expansion is a key driver of that growth.

Let us know if you’re interested in learning more about Emma and her role in leading global growth. Also happy to connect you with Away’s co-founders, Jen Rubio and Steph Korey, to discuss the impact Emma has had since joining Away.

Thanks,

Ben

6. Make your company look bigger than it actually is

In order to secure key partnerships and to position itself as a design brand, Away had to look big and professional already from the start.

The Lookbook

One of the earliest investments from Away was a professional photoshoot showing the founders, the product and several high quality lifestyle images. The photoshoot costed around $30k and it generated hundreds of assets that the company used for 6 months to populate the website and social medias, and to make Away look like a professional company.

The Press

The lookbook also served the purpose of equipping the press with all images for an article, so the effort required from journalists would be minimal.

In general the high coverage from press made Away look bigger and more influential, which helped generating interest from potential partners.

The Stores

Starting from early on, Away opened pop up stores in New York and more recently Los Angeles, London and Berlin. Showcasing a concrete product facilitated customers in making a purchase decision, helped partners assessing the quality and credibility of the brand and positioned Away as an international company. Today, Away has a permanent (and profitable) store in SoHo, New York.

The Community

Away built a strong community of influencers and happy customers which fuels word of mouth with an impressive amount of user generated content. Facebook posts, Instagram images and tweets from all over the world give the external perception that Away is everywhere.

7. Use influencers as your social media managers

Away is active on all key social medias: Instagram (29k followers), Facebook (13.5k likes and 4.8 star rating), Twitter (2.3k followers), Pinterest (1.7k followers) and Snapchat (0.5k contacts), with Instagram being the most important one:

The Instagram account is curated with high quality images but what is special about the account is that most of these images are user generated content, coming from both customers and influencers.

Examples:

Influencer Marketing Strategy

• Before working with the first influencers, Away arranged professional photo shooting in Panama. The photoshooting generated hundreds of assets that served the purpose of populating its social media channels with the first images and followers as well as creating the first lookbook for the press. High quality native content on social medias helped when reaching out to the first influencers as a fashion company.

• After populating social medias with the first images, Away started reaching out to Instagram lifestyle, travel, tech and fashion influencers ranging from few thousands of followers to millions. To influencers with an average number of followers, Away sends a free carry on luggage for influencers to take pictures with and post. For influencers with a larger follower base, Away organizes exclusive events. For those influencers with a small number of followers instead, Away sends luggages returned from other customers (with a small scratch or defect).

• Away never pays influencers with cash. This is possible with a fashionable consumer product. When viable, this is in general a better and cheaper strategy, as the influencer knows the price of the luggage but not the cost, i.e., the perceived value is higher.

• As an effort to make Away an inspirational fashion brand, influencers do not post vouchers or discounts to push sales.

• Especially for a company with a generic name such as Away, it is important to own a hashtag and educate influencers to use it. For away it’s #travelaway and #awaywego

• One of the consequences of the point above is that the ROI of influencer marketing is not tracked. Only few KPIs such as reach and engagement rates can be estimated.

• Influencers post high quality pictures with Away suitcases from all over the World. Not only producing these images in-house would be highly expensive (see above picture taken in front of a private jet in Moscow), but also checking in from several different locations makes Away appear as a global brand.

• While the number of posts on the account is about 400, the number of times Away was tagged by customers and influencers is more than 1300 (~3x). With such a high amount of content produced by users, Away has the luxury to decide to show only the greatest images on its account.

• All of this generates awareness of the brand among influencers. As of today, Away doesn’t have an influencer sourcing strategy, as it receives up to 30 inbound requests per day from influencers who want to start a partnership.

• Away as a brand already became so well known among influencers that influencers use the partnership with Away to improve their credibility. There are some influencers who purchased a suitcase and posted on Instagram a picture of them with it along with a thank you message to Away, as to pretend the post is the result of a partnership.

8. Do not craft the message to your audience but to whom your audience aspires to be

One important aspect of Away strategy is the positioning of the brand as aspirational brand. The company targets millennials who aspire to be “modern travelers”.

Away believes anyone can go everywhere, the world is a shared place, and every trip is part of the exchange, no matter the destination. It believes in making connections: on the road, online, and in person. It values access over aspiration, and exploration over escape. All time away is time well spent.

The influencer community, with photos and check ins in every possible location, plays a key part in the positioning of the brand.

Use of “cheap” words is not allowed

To achieve an inspirational brand status, the use of words such as cheap, inexpensive, deal and discount are never used. In ads and editorials you rather see sentences such as “for a fraction of the price” or “the perfect carry on under $250”

Influencers don’t share voucher codes

Influencers are not allowed to share voucher codes when posting for Away. Sharing voucher codes would make the posts feel non spontaneous.

No banner ads, only advertorials

Very important, a high portion of conversions comes from sponsored content and revenue share deals, but none of this sponsored content is banners, it is always advertorials promoting the brand in a organically looking way.

Below two examples of successful advertorials on Business Insider and Lifehacker:

9. Turn your customers into your number one marketing channel

A good brand marketing strategy only works to amplify an excellent product and service. And this is in primis what the success of the company is predicated on.

The customer service of Away is trained to go above and beyond the expectations of the clients. Customers are so used to poor customer service that talking to someone who cares is an unexpected and refreshing surprise.

Away achieved a Net Promoter Score of 80 after one year of operations.

More than 10% of all sales come from the company referral program as of Google Analytics, but the effect of word of mouth is definitely bigger than that as not all cases of word of mouth are covered on Google Analytics.

Customer appreciation on Twitter, Facebook and Email

10. Never pay for what you can get for free

The whole company has a strong bootstrapping culture and every marketing manager is invited to think of ways to get things cheaper or for free.

Example:

Away wanted to send a premium gift card to all of its customer base. The cost of this campaign would be $20k. Instead of investing this amount of money, Away reached out to several potential partners asking whether they wanted their gift card to be included in the send out for a price.

Including several gift cards from different brands such as Blade, Violet Grey, Outdoor voices, Vogue, Tommy John, UberEATS and Spruce&Co meant more value to the customers, to the brands and a free marketing campaign for Away.

Conclusion

Google Analytics doesn’t help measuring the success of Brand Marketing

If we were to evaluate the ROI of the brand marketing activities described above only based on sales as of Google Analytics, even with a proper attribution model, we would most likely stop all of them.

Most of the transactions for Away come from direct, SEM Brand and SEO Brand traffic sources.

Below you can see how the popularity of the search term “Away luggage” developed against “Tumi luggage”as of Google Trends, with Tumi being a much bigger competitor.

Even taking account the seasonality shown in the last two months of the year, it is impressive to see how quickly the brand popularity has grown.

Part of the organic traffic may be the resulting brand awareness generated from performance marketing ads, but such a steep curve does not usually come from investing in performance marketing ads.

The ROI of some of the brand marketing campaigns cannot be measured.

For example, the one below is a brand marketing campaign in Miami consisting of a suitcase mobile charging station which costed $5k overall. What is the ROI of that?

You can approximately calculate how much it costs to reach an audience, but there is no way to track sales.

As another example, no vouchers shared by influencers means there is no way to track influencer marketing sales from Instagram other than clicks on the link in the account bio, which we expect to be a small share.

Away does not measure the success of brand marketing campaigns based on ROI. As these are mostly “top of funnel” campaigns, the metrics evaluated are Reach, Engagement Rate and CPM.

Interdependency of marketing activities

Another important factor to take into consideration is the interdependency of all brand marketing campaigns, for example:

• High press coverage facilitates partnerships.

• Partnerships with popular brands make it easier to partner with other brands and often result in articles from the press.

• Using Facebook ads to increase the reach of PR articles helps securing more organic coverage.

• Co-marketing with partners also means more value for customers and cheaper marketing campaigns.

• Pop up stores help with press and partnerships.

• A big influencer marketing network increases word of mouth, global reach and brand awareness.

It is overall difficult to properly assess the standalone impact of each channel, when all of them are connected.

The team

Away team grew to ~30 employees in the last two months, including the addition of a Director of Brand Marketing from Uber. However, the team that made growth happen in the first phase was much smaller, and Jen, Co-Founder and Creative Director, was the person behind press, partnerships and brand marketing success.

Currently, with regards to marketing, there are only two people doing performance marketing acquisition, two doing brand marketing, two for pr, one for crm and six in creative services, mainly involved in design.

Budget allocation

If we were convinced that the right way to evaluate brand marketing impact is with reach, engagement and CPM KPIs, still the unsolved issue would be how to allocate budget between brand marketing and performance marketing campaigns.

Away splits the budget arbitrarily, with a marketing budget that is 15% of revenues and a 50/50 split between brand and performance.

Another approach would be to credit all direct, SEM brand and SEO brand traffic and sales to brand marketing campaigns and compare the CAC of these activities with that of performance marketing activities.

Important to say however, is that the personnel expenses behind a brand marketing team are often way higher compared to those required to run a performance marketing team (think about content production, copywriting, video and design resources), so the team structure should be taken into account when comparing the two.

Final remarks

Away is a great example of how a company can grow fast by building a brand already from the start. Away is still a young company, and it is now developing processes to scale. What Away did best was to start lean, build a great product first and then scale, while often startups scale and expand internationally before finding a product-market fit. This document and the tactics described should serve as inspiration to do a better job in building and growing a brand.

Not every business model is suitable for a brand marketing growth similar to Away:

• High impact influencer marketing is easier for a high end company offering a physical product.

• Press coverage from icons such as Vogue is possible for a company positioning itself as fashion brand.

• Offering a great customer experience is tough when margins are tiny.

• Engagement on social media channels, especially on Instagram, works best for travel, fashion, food and lifestyle companies.

And certainly, not every founder can drive such a brand success. Building a brand requires a long term vision, passion, inspiration and a great company culture.

Enrico Ferrari, Chief Marketing Officer at Rocket Internet

“Do we run marketing from HQ, or do we hire people on the ground?”

If you centralize everything, you’re efficient but “deaf” to the local culture. If you localize everything, you’re fast but your costs spiral and your brand becomes a mess of different identities. I know for a fact some of you are experiencing this right now.

Over the years, I’ve developed a simple rule of thumb to guide the decision:

Centralize what is scalable. Localize what requires proximity.

The Global Engine

In my experience, Performance Marketing (Google, Meta, TikTok etc.) belongs at HQ. The “operating system”, meaning your campaign structure, tracking, naming conventions, and bidding logic, doesn’t change when you cross a border. You want one elite team running the engine. What they need from the local markets is not the media buying capabilities but the fuel to the media buying: the right creative and messaging, the right local offers, and the right language.

The Local Pulse

On the flip side, offline and relationship-driven channels can’t be managed from a distance. You can’t easily negotiate TV spots in Paris from an office in New York. You can’t build a local influencer community or a physical partnership via Zoom. If a channel depends on “who you know” or “how things are done here,” it stays local.

The 6 Variables I Look At First

Before making a call, I always stress-test the business against these six factors:

1. Budget: Let’s be real, localization is expensive. If you’re lean, you centralize by necessity.

2. Talent: Do you have people at HQ who actually understand these markets? If not, you have to go to the source.

3. The Business Model: SaaS can often stay centralized longer. Logistics or “feet on the street” businesses (like food delivery) need local teams almost immediately.

4. Growth Motion: If you’re sales-led, you need local folks to grab coffee and close deals. If you’re product-led, you can stay central for much longer.

5. Cost vs. Attractiveness: Some hubs are great for talent but too expensive to justify the overhead early on.

6. Revenue: Once a single country starts bringing in a significant chunk of your ARR, it’s earned the right to its own dedicated team.

The Stuff People Underestimate

Most leaders stop at the list above. But I’ve seen expansion plans fail even with a “perfect” org chart because of a few hidden dimensions:

• Decision Latency: This is a killer. Centralizing gives you control, but if a local team has to wait 48 hours for HQ to approve a social media post, you’ve already lost. In fast markets, speed beats efficiency.

• The “Same Language” Trap: Thinking that “English-speaking” means “same culture” is a huge mistake. The way you persuade a customer in London is fundamentally different from how you do it in Sydney.

• Accountability: I’ve seen many hybrid models fail because no one knew who actually owned the P&L. If the local lead has the revenue target but HQ has the budget, you’re setting yourself up for a fight.

• Category Maturity: If no one in the new country knows what your product category is, you need local “educators.” If the category is mature, you can just run the central playbook.

The Bottom Line

Most companies don’t think about this until they hit market number three or four. By then, they’ve usually built a mess of “temporary” fixes.

Start with the scale-vs-proximity rule, but don’t ignore the “soft” stuff like decision speed and accountability. That’s usually where the real growth is won or lost.

As always, let me know if you found the issue interesting by hitting like or by commenting the post.

Thank you,
Enrico

If you’re calculating yours today, you are likely falling into one of four traps:

1. Using Revenue instead of Margin: To represent value, the numerator must be contribution margin (revenue net of COGS, fees, and variable costs).

2. Unrealistic Time Horizons: Calculating a 10-year LTV for a non-subscription e-commerce brand is a recipe for bankruptcy.

3. Ignoring Survival Probability: You cannot assume 100% of customers stay forever. You must adjust each period by the probability of a customer being active.

4. Ignoring the Time Value of Money: $100 received in two years is not worth $100 today.

Knowing what to avoid is only half the battle. To be a “Hero,” you need to know which formula to deploy for your specific business model and requirements. Here are the three ways to calculate LTV.

1. Basic: The Perpetuity Formula

Best for: Stable businesses with predictable churn and no major fluctuations in margins.

This is the “back of the envelope” calculation. It assumes that the customer relationship could theoretically last forever, but it’s limited by the churn rate.

The Formula:

• CM: Contribution margin per period.

• CR: Churn rate (percentage of customers who leave each period).

Real-World Example:

Imagine a boutique gym. The member pays a monthly fee that results in a $50 contribution margin (CM). Their monthly churn rate is 5% (CR).

LTV = ($50 / 0.05) = $1000.

2. Intermediate: The Probability-Adjusted Formula

Best for: Businesses with high early-stage churn or non-contractual relationships (e.g., e-commerce).

This method recognizes that 100% of customers are active the day they are acquired, but that number drops over time. You adjust the margin of each period by the “Survival Probability”.

The Formula:

• CM: Contribution margin per period.

• CR: Churn rate per period (percentage of customers who leave each period).

• s: Survival probability per period (percentage of active customers per period, i.e. retention rate).

Real-World Example:

Let’s look at a fashion e-commerce business.

• Year 1: 100% Retention Rate. Expected Margin: $50.00.

• Year 2: 50% Retention Rate. Expected Margin: $25.00.

• Year 3: 30% Retention Rate. Expected Margin: $15.00.

• Year 4: 20% Retention Rate. Expected Margin: $10.00.

By summing these “decaying” margins over a set horizon, you get a much more realistic view of what a customer is actually worth.

LTV (4 Years) = ($50 + $25 +$15 +$10) = $100.

LTV (2 Years) = ($50 + $25) = $75.

Choosing a lifetime cap: For most e-commerce businesses, it’s best practice to truncate LTV calculations between 2 and 5 years, to ensure projections remain grounded in realistic market conditions and avoid the "infinite value" trap.

Calculating survival probabilities in practice: To calculate survival probabilities in practice, you should track customer cohorts over time and determine the percentage of users who remain active at each specific interval (e.g., month 1, month 2, etc.). If you’d like me to cover how to run these calculations with an example, let me know in the comments.

3. Advanced: The Net Present Value Formula

Best for: High-growth startups, SaaS, or companies with very long customer lifecycles.

This is how you connect CMO thinking with CFO thinking. It incorporates the Discount Rate, the annual interest rate or opportunity cost of capital.

The Formula:

• CM: Contribution margin per period.

• CR: Churn rate per period (percentage of customers who leave each period).

• s: Survival probability per period (percentage of active customers per period).

• (1+i)^t: Discount rate.

• i: Annual interest rate or opportunity cost of capital.

Real-World Example:

Let’s look at a SaaS business with yearly contracts with upfront payments, and add a e.g. 12% annual discount rate to account the fact that $1,000 in 10 years is not the same as $1,000 today.

Suppose this business offers yearly contracts at $1,000 contribution margin and the churn rate is stable at 10%.

• Year 1: 100% RR. Exp. CM: $1,000. NPV: $1,000 / (1 + 12%)^(1-1) = $1,000

• Year 2: 90% RR. Exp. CM: $900. NPV: $900 / (1 + 12%)^(2-1) = $804

• Year 3: 81% RR. Exp. CM: $810. NPV: $810 / (1 + 12%)^(3-1) = $646

• Year 4: 73% RR. Exp. CM: $730. NPV: $730 / (1 + 12%)^(4-1) = $519

• Year 5: 66% RR. Exp. CM: $660. NPV: $660 / (1 + 12%)^(5-1) = $417

• Year 6: 59% RR. Exp. CM: $590. NPV: $590 / (1 + 12%)^(6-1) = $335

• Year 7: 53% RR. Exp. CM: $530. NPV: $530 / (1 + 12%)^(7-1) = $269

• Year 8: 48% RR. Exp. CM: $480. NPV: $480 / (1 + 12%)^(8-1) = $216

• Year 9: 43% RR. Exp. CM: $430. NPV: $430 / (1 + 12%)^(9-1) = $174

• Year 10: 39% RR. Exp. CM: $390. NPV: $390 / (1 + 12%)^(10-1) = $140

LTV (Non-Discounted): $6,513

LTV(Discounted): $4,519

Once you factor in that future money is worth less today, the lifetime value might drop significantly.

How to choose the interest rate for discounting: You should typically use your company’s Weighted Average Cost of Capital (WACC) or a specific hurdle rate (often set between 8% and 15%). While a standard benchmark of 10% is frequently used for retail and SaaS, you should adjust this upward for highly volatile markets or downward for stable, long-term B2B contracts to more accurately reflect the present value of uncertain future profits.

Why this matters: Taking into account the financial value of time might reveal that you are losing money on customer acquisition in present value terms. For example, suppose CAC is $5,000. Without considering the time value of money, one might conclude that customer acquisition is profitable in this example, when in fact it isn’t.

The Decision Rule

The fundamental rule for any marketing spend is simple: invest only if the projected LTV is greater than or equal to CAC.

Whether you are deciding which segment to target or when to “fire” a low-value customer, let the math, not gut feeling, guide you.

As always, if you enjoyed reading this piece, let me know with a like or a comment.

Thank you for reading,

Enrico

In reality, there are 10 things to figure out.

Here’s the framework I developed in over a decade helping startups succeed at GTM. It’s called “The 10 Ps of GTM”.

The first 4 Ps are the ones everybody knows. But the remaining 6 Ps are the ones where most founders have blind spots.

Do you want your startup to succeed?

Keep reading, as I’ll break down each P, including key decisions, dangers and hidden tradeoffs.

1. Product

The specific value you promise to deliver and the problem you commit to solving.

Key decisions
- What core problem you solve versus what you ignore.
- What outcome you promise versus what you leave implicit.
- What makes your product meaningfully different versus merely better.

Why it is dangerous
Product decisions anchor expectations. Expectations are sticky.

Hidden tradeoff
Sharper value propositions speed up GTM but limit future optionality.

2. Pricing

How you capture value and signal worth in the market.

Key decisions
- Whether price reflects value, cost, or competition.
- Who pricing is designed to attract or repel.
- Whether pricing optimizes for learning, margin, or speed.

Why it is dangerous
Pricing is interpreted emotionally, not rationally.

Hidden tradeoff
Underpricing accelerates adoption but distorts customer feedback.

3. Place

How and where your product reaches the customer.

Key decisions
- Which primary distribution channel you commit to first.
- Whether you prioritize reach, control, or economics.
- How dependent you become on intermediaries.

Why it is dangerous
Early distribution choices create long term dependencies.

Hidden tradeoff
Convenient channels impose invisible constraints later.

4. Promotion

How you create awareness, interest, and demand.

Key decisions
- Whether you focus on demand creation or demand capture.
- What message you repeat consistently versus what you test.
- Which metrics define success early on.

Why it is dangerous
Promotion surfaces flaws in your product faster than anything else through reach.

Hidden tradeoff
Short term performance can hide long term positioning weakness.

5. Persona

The specific group of people you design and market the product for.

Key decisions
- Who the primary buyer truly is.
- Who the product is explicitly not for.
- Whose problem is urgent enough to act now.

Why it is dangerous
Vague personas create vague decisions everywhere else.

Hidden tradeoff
Narrow focus improves conversion but challenges scale. It’s a tradeoff.

6. Platform

The environment in which your product is built, distributed, and experienced.

Key decisions
- What infrastructure you own versus rent.
- How much control you need over data and experience.
- How quickly you need to move versus how flexible you need to be.

Why it is dangerous
Platform choices are hard to reverse once growth starts.

Hidden tradeoff
Speed today often limits strategic freedom tomorrow.

7. Plan

How your go to market is funded and paced.

Key decisions
- How much uncertainty your funding model tolerates.
- What outcomes your capital providers expect.
- How fast you must show traction.

Why it is dangerous
Capital shapes behavior more than founders would expect.

Hidden tradeoff
More capital reduces patience for exploration and for organic growth.

8. Profit Formula

The economic logic that determines whether GTM scales sustainably.

Key decisions
- Which unit economics matter most early.
- What payback period is acceptable.
- Which costs are variable versus structural.

Why it is dangerous
Bad economics eat cash quickly and put you out of market before you know it.

Hidden tradeoff
Growth can mask poor economics for as long as capital is abundant.

9. People

The capabilities and judgment required to execute GTM.

Key decisions
- What to hire versus what founders must own.
- What seniority mix enables speed.
- When to bring in specialists.

Why it is dangerous
The wrong people slow execution even when they are talented.

Hidden tradeoff
Experience reduces mistakes but increases complexity and burn.

10. Processes

How work gets done repeatedly and predictably.

Key decisions
- What must be systematized early.
- What should remain flexible.
- How performance is measured and reviewed.

Why it is dangerous
Process decisions determine whether success is repeatable and scalable.

Hidden tradeoff
Process increases efficiency but reduces adaptability.

The Bottom Line

If you only consider the 4Ps, you are already losing the game.

You need a broader strategy.

A go-to-market strategy works when decisions about the 10 Ps reinforce each other.

You need coherence.

Once you have it, here’s my advice:

• Go live as soon as possible

• Get feedback fast

• Refine over time

You can have a MVP for every single P.

But you cannot go to market without thinking about all 10.

They’re all interconnected.

As always, if you enjoyed reading this piece, let me know with a like or a comment.

Thank you for reading,

Enrico

“We’re cheaper than competitors.”
“We offer the same thing for less.”
“We pass the savings to the customer.”

If your entire edge is low prices, and competitors can match those prices tomorrow, you do not have a competitive advantage. You have a tactic. And tactics are temporary.

A real competitive advantage must be sustainable. It must give you something competitors cannot easily copy, even if they try.

Let’s reflect on what a real advantage looks like in practice.

The Value Bar Strategy Framework

The value bar framework is, in my opinion, one of the most powerful strategy models ever created.

It looks at value through four numbers:

• WTP: Customers’ willingness to pay
• P: The price you charge
• C: Your cost to deliver
• WTS: Suppliers’ willingness to supply

Willingness to pay minus willingness to supply equals total value created.
Your margin sits inside that value.

A firm has a competitive advantage when it creates more value than competitors. There are only two reliable ways to do this:

1. Increase willingness to pay more than your competitor

2. Reduce cost (or willingness to supply) more than your competitor

These correspond to the only two sustainable strategy paths:

• Differentiation
• Cost Leadership

Path 1: Differentiation

Differentiation increases willingness to pay.
It makes customers value your product more highly than alternatives, allowing you to charge higher prices without losing demand.

Differentiation is what allows companies to command a premium even when competitors offer similar functionality.

Examples:

• Apple does not do discounts because its ecosystem, design, and brand are irreplaceable. Competitors can copy features, but they cannot be Apple.

• Louis Vuitton commands premium prices not because of materials, but because of heritage, craftsmanship, brand equity, and cultural status. You can make a similar bag. You cannot recreate 150 years of brand meaning.

• Nike sells a sneaker for $120 dollars when similar shoes go for $60 thanks to its brand power, athlete endorsements, and cultural relevance.

Ways to differentiate:

Based on the logic of the value bar, companies increase willingness to pay by strengthening:

Customer value
Better product performance, stronger design, higher quality.

Brand value
Meaning, symbolism, reputation, emotional resonance.

Experience value
Frictionless service, superior support, faster delivery, convenience.

Perceived value
Storytelling, positioning, cultural relevance, trust.

A differentiated company widens the top of the value bar: customers are simply willing to pay more.

The Value Bar:

The bar reflects the competitive advantage gained through Differentiation, showing:

• Higher WTP
• Same or similar costs
• A wider value wedge

Path 2: Cost Leadership

Cost leadership widens the value bar from the bottom.
It reduces the cost of delivering the product, without lowering willingness to pay.

The key is that the cost advantage must be structural, not temporary.
Structural means: competitors cannot copy it quickly or cheaply.

Examples:

• Ryanair runs on an ultra lean model based on one aircraft type, rapid turnarounds, secondary airports that legacy airlines cannot replicate.

• Saudi Aramco extracts oil at $3 per barrel while most competitors pay $20+. You cannot replicate being on top of the world’s cheapest oil reserves.

• Walmart’s scale, logistics, and supplier leverage give it a cost structure smaller retailers cannot mimic. You can copy the store layout, not the supply chain.

Ways to achieve cost leadership:

Companies reduce cost by improving the underlying economics of the business:

Scale advantages
Larger volume spreads fixed costs and increases purchasing power.

Operational simplicity
Standardization, fewer variants, reduced complexity.

Efficiency
Streamlined supply chain, faster processes, lower waste.

Resource advantages
Access to lower-cost inputs that competitors do not have.

Structural cost advantages lower the bottom of the bar, increasing the total value created.

The Value Bar:

The bar reflects the competitive advantage gained through Cost Leadership, showing:

• Same or similar WTP

• Lower costs

• A wider value wedge

The bottom line

If your advantage is price and everyone else can copy that price, you don’t have a competitive advantage.

Real competitive advantage comes from only two places:

• You create more willingness to pay
• You deliver the product at lower cost

Differentiation raises the top of the value bar.
Cost leadership lowers the bottom of the value bar.

Everything else is a tactic.
Only value is a strategy.

If you enjoyed this, feel free to share it.

Enrico

On paper, it’s great.

Why startups love offering equity

Three simple reasons.

One. They need talent they can’t afford.
Startups run lean. Salaries lag behind big tech and large corporations. Equity becomes the balancing mechanism.

Two. Equity aligns incentives.
If the company wins, you win. Employees start acting more like owners. Boards and founders love this.

Three. It boosts retention.
Vesting schedules and one-year cliffs keep people around long enough to build something that lasts.
Rather than only compensation, Equity is a retention strategy.

Equity is a bet. Far from guaranteed compensation. A bet on the company, the founders, the market, and your ability to stay long enough to see a liquidation event.

You should know exactly what you’re betting on.

What to watch out for

Most people don’t understand how their equity works. And that’s not their fault. The way equity is presented during recruiting is often confusing or incomplete.

Here are the most important things to pay attention to:

• Contract: Most equity contracts give you the right to buy shares, not actual shares
• Vesting: Equity almost always includes vesting schedules and a one-year cliff
• Exercise: There may be an exercise window that forces you to buy before the exit
• Liquidity: Options are illiquid and only pay at an exit or approved secondary sale
• Dilution: Every fundraising round dilutes your ownership percentage
• Exit: Most startups will never reach an exit that makes the equity meaningful

The Most Common Types of Equity Contracts

Not all equity contracts are equal. Here are the most common structures.

1. Employee Stock Option Plans (ESOPs)

You receive the option to buy company shares later at a fixed strike price.

Pros:

• High upside if the company grows

• Strong alignment with long-term value

Cons:

• You must pay to exercise

• Can become worthless if the stock price is below the strike

Where common:

US startups and private tech companies. Increasing adoption in Europe but still less common.

2. Employee Stock Purchase Plans (ESPPs)

You set aside part of your salary to buy shares later at a discount.

Pros:

• You accumulate funds over time

• Guaranteed purchase discount

• Straightforward for public company stock

Cons:

• You still need to make the purchase

• Mostly unavailable in private companies

Where common:

US public companies with favorable tax treatment. Rare in Europe.

3. Virtual Stock Option Plan (VSOP)

You don’t own shares. Instead, you receive a cash payout that mirrors the value of shares at exit. Economically similar to ESOPs but without issuing shares.

Pros:

• No exercise cost

• No upfront cash needed

• Clean for the company’s cap table

Cons:

• You cannot become an actual shareholder (no voting rights or dividends)

• Pays out only at exit or designated payout event

Where common:

Very common in Europe, especially where issuing shares is more complex.

4. Restricted Stock Units (RSUs)

You receive actual shares automatically when they vest.

You automatically receive the shares after the vesting period, without having to pay for them.

Pros:

• No strike price

• Automatically delivered at vesting

• No voting rights or dividends until conversion

Cons:

• Taxation typically happens at vesting

• Do not include voting rights or dividend benefits until conversion

Where common:

US public companies and later-stage startups. Increasingly used in Europe by large tech and multinationals.

5. SARs (Stock Appreciation Rights)

You receive compensation based on the increase in stock value over time.

Pros:

• No need to purchase shares

• You benefit only from upside

• Paid in cash or stock

Cons:

• Worthless if the stock doesn’t appreciate

• Taxed as ordinary income when exercised

Where common:

Mid-size and large US companies. Rare in Europe.

6. RSAs (Restricted Stock Awards)

You receive real shares immediately, but they remain restricted until vesting.

Pros:

• You own the shares upfront

• Often include voting rights and dividends

• No strike price

Cons:

• Shares remain restricted until vesting

• Taxation typically occurs at vesting

Where common:

US early-stage startups, especially for first hires or founders. Much less common in Europe.

Conclusion

Equity can have a major impact on your compensation and long-term upside. But only if you understand what you’re receiving, what it costs you, when it becomes liquid, what risks you’re taking, and what needs to happen for it to actually be worth something.

Before signing anything, take the time to understand the mechanics. Equity can be the best part of your compensation or the most overrated.

As always, if you enjoyed reading this piece, let me know with a like or a comment.
Thank you for reading,
Enrico

Companies know it destroys margin. They complain about it. They hate the planning. Yet they do it every single year.

It makes no economic sense.

But it makes perfect sense through the lens of Game Theory.

This is where the original Prisoner’s Dilemma explains everything about this modern sales event.

What the Prisoner’s Dilemma actually means

Two criminals are arrested. The police separate them. Each one is offered the same deal:

• If both stay silent, they both receive light sentences
• If one confesses and the other stays silent, the confessor goes free and the silent one gets the maximum sentence
• If both confess, they both receive heavy sentences

The rational move for each prisoner is to confess.
They protect themselves.

But when both follow their rational strategy, they end up with a worse outcome.

Individual rationality creates collective irrationality.
That is the core idea.

Why Black Friday works exactly the same

Imagine two competing brands, A and B.
They each have two options: 1. Hold prices, 2. Discount aggressively.

Three scenarios:

• If both hold, they both maintain margin.

• If one discounts and the other holds, the discounter steals customers and market share.

• If both discount, they protect share but destroy margin.

Each company wants to avoid the worst outcome:
being the only one that doesn’t discount.

So the dominant strategy becomes discounting, even though it hurts everyone.

This outcome is called the Nash equilibrium.
It is the point where neither player can unilaterally change strategy without making themselves worse off.

Both discount. Both hate the result. And… both repeat it anyway.

Why Black Friday no longer works economically

Black Friday once made sense because only a few brands participated.
There was differentiation. The economics worked.

Now everyone does it.

It has become a zero sum game with lower margins and no real advantage.

Most Black Friday revenue is not incremental.
It is pulled forward from December or January, often at lower margin.

Don’t be fooled by the increase in topline. It’s the contribution margin that matters.

How brands can escape the trap

The Prisoner’s Dilemma is powerful, but it’s possible to escape.
Below are the three ways companies break free from the discounting equilibrium.

1. Differentiate your payoff function

If your brand value and customer relationship don’t rely on price, you’re not playing the same game anymore. You’ve changed the incentives.
Examples:

• Apple rarely discounts its core products. Their “Black Friday” offers are gift cards, never real price cuts.

• Patagonia avoids heavy discounting entirely and focuses on mission, durability, and repair.

• Arc’teryx maintains premium positioning by keeping discounts minimal and tightly controlled.

When price is no longer the main lever, competitors can discount all they want.
You’re not in that game.

2. Change the rules of the game

If you can’t win the existing game, create a new one.
Examples:

• Alibaba created Singles’ Day, a shopping event bigger than Black Friday, shifting attention to a date they control.

• Amazon built Prime Day, turning discounting into a loyalty event only for members.

• Sephora uses private member sales, where heavy discounts are offered only to Beauty Insider tiers, not the broad market.

Creating your own event resets expectations and moves competition onto your terms.

3. Reduce discounting frequency overall

Black Friday happens once a year, but many brands discount constantly. This is what traps them in a repeated prisoner’s dilemma.
The escape is to stop training customers to wait for sales.
Examples:

• Lululemon discounts very selectively and uses “We Made Too Much” only for slow movers, not core products.

• Nike increasingly reserves discounts for its own DTC channels, building loyalty while reducing broad-market promo dependency.

• Rolex, Chanel, and most luxury houses maintain pricing power because they barely discount, ever. Black Friday or otherwise.

When discounting becomes rare and intentional, Black Friday becomes a controlled operational lever instead of a dependency.

The bottom line

Black Friday is a perfectly rational decision that creates an irrational collective outcome.

The brands that win long term do not play the game by default.
They change the incentives.
They change the rules.
They change the frequency.

And they protect their margins while everyone else races to the bottom.

If you found this useful, feel free to share it with someone planning their Q4 promo calendar. It might save them a lot of margin.

And please do let me know you enjoyed this post by liking, commenting or responding.

It’s a small gesture, but it keeps me motivated to write.

Sounds like an easy question, right? Something you could just ask your analyst and get a number in return.

As a matter of fact, the reality is trickier.

Depending on whether you’re talking to your CEO, your CFO, or your Board, CAC can mean completely different things. In fact, there are five main types, and if you don’t know which one your audience is thinking of, you’ll end up talking past each other.

Here’s a breakdown of the five CACs that every marketer, founder, or growth leader needs to know before their next meeting.

1. Blended CAC

Definition

Blended CAC measures the average cost to acquire a customer, across all channels and campaigns. It’s calculated by dividing total marketing costs by total new customers acquired in a given period.

It’s the only CAC you can calculate deterministically, directly from financial and CRM data, without making attribution assumptions.

Numerical example

If you spend:

• Paid ads (Google, Meta, TikTok): $80,000

• Content marketing and SEO: $10,000
  Total = $90,000

…and acquire 600 new customers, then:

This means that, on average, you spent $150 to acquire each customer.

Pros

• Simple and certain

• Works well for finance and board reporting

• Good for tracking efficiency over time

Cons

• No insight into which channels work

• Masks inefficiencies between organic and paid

• Takes credit for all new customers

Stakeholders

CEO/Founder, finance, marketing leadership, investors, analysts.

When To Use It

• Early-stage companies without attribution data

• Investor or board reporting

• When channels overlap (brand, PR, organic)

• Benchmarking performance across time

2. Fully-loaded CAC

Definition

Fully-loaded CAC includes all costs related to acquiring customers: direct spend (ads, agencies) and indirect overhead (salaries, tools, legal, creative production).

It’s the “real” CAC that represents what it actually costs to grow.

Numerical Example

Adding overhead to the previous case:

• Paid ads: $80,000

• Content & SEO: $10,000

• Tools: $5,000

• Salaries: $25,000

• Agencies & freelancers: $15,000

• Creative production: $10,000

• Legal & compliance: $5,000
  Total = $150,000

With 600 new customers:

150,000 ÷ 600 = $250 per customer

Pros

• Reflects total economics of growth

• Aligns with board expectations

• Reveals hidden inefficiencies

Cons

• Difficult to calculate precisely

• Requires cross-functional collaboration

• Subjective inclusion of certain costs

Stakeholders

CEOs, boards, finance, marketing leadership, FP&A.

When To Use It

• Board meetings or fundraising

• Budgeting and forecasting

• Profitability analysis (LTV:CAC)

• Mature or scaling companies with overhead

3. Incremental CAC

Definition

Incremental CAC measures how much you spend to acquire only the customers who wouldn’t have signed up otherwise.

It isolates the causal effect of marketing using lift studies and control groups. This CAC is the only one that attempts to measure causality. It gives a realistic picture of how effective marketing spend actually is at generating incremental revenue.

Numerical Example

A campaign spends $75,000 and brings 300 new customers.
A lift study shows only 200 were incremental (100 would have signed up anyway).

75,000 ÷ 200 = $375 per customer

Pros

• Measures true marketing impact

• Informs smarter budget allocation

• Enables causal ROI analysis

Cons

• Requires controlled experiments

• Statistically sensitive to design and sample size

• There’s an opportunity cost attached to holdouts

Stakeholders

Growth teams, analysts, marketing leadership, finance, CEO/Founder.

When To Use It

• Testing new channels or campaigns

• ROI or budget allocation analysis

• Deciding whether to scale spend

• Mature marketing orgs with experimental setups

4. Marginal CAC

Definition

Marginal CAC measures the additional cost of acquiring one more customer as you scale. It answers: “What will it cost me to get the next customer?”

It’s essential for identifying the point where acquisition becomes unprofitable, which is when:

Numerical Example

Suppose your company acquires 100 customers at a total cost of $20,000 (average $200/customer). You now spend an extra $1,000 to acquire one more customer (the 101st). Your marginal LTV is $750.

In this case, you are losing $250 ($750-$1,000) on that marginal acquisition. This means that it is not profitable to scale further.

Pros

• Critical for profitability and scaling decisions

• Reveals diminishing returns

• Enables precise growth modeling

Cons

• Volatile in small samples

• Requires accurate, granular data

• Hard to measure across blended campaigns

Stakeholders

CEO/Founder, growth teams, finance, boards, analysts.

When To Use It

• Scaling campaigns or channels

• Forecasting and profitability modeling

• Dynamic LTV:CAC comparison

• Setting stop-loss thresholds for marketing spend

5. Attributed CAC

Definition

Attributed CAC is the cost per customer as reported by platforms or attribution models (MTA, MMM).

It’s useful for comparing relative performance between campaigns and channels, but not for total cost analysis.

Numerical Example

Suppose your company spends:

• Meta: $50,000 spend → 300 customers → $167 CAC

• Google: $30,000 spend → 150 customers → $200 CAC

Great for relative comparisons within channels, but it doesn’t capture overlap, double attribution (in case of platform data), or organic conversions.

Pros

• Easy to calculate and automate

• Ideal for daily or weekly dashboards

• Great for relative optimization

Cons

• Doesn’t reflect total or incremental cost

• Can mislead when channels overlap

• Depends heavily on attribution model

Stakeholders

Marketing teams, growth managers, analysts, CMOs.

When To Use It

• Channel and campaign optimization

• Daily reporting and dashboards

• A/B or creative testing

• Not for strategic or profitability analysis

Closing Thoughts

CAC is one of the most abused metrics in marketing.
Everyone uses the same acronym but not everyone means the same thing.

If you want to sound credible in your next board meeting or CMO interview, make sure you know which version you’re talking about.

In short:

• Blended CAC: the simplest average

• Fully-loaded CAC: the true all-in cost

• Incremental CAC: the causal one

• Marginal CAC: the scaling one

• Attributed CAC: the tactical one

The smartest companies track all five and know when to use which.

If you found this useful, consider sharing it with someone who keeps saying “our CAC went up” without knowing which CAC they mean.

And if you’d like me to cover “LTV from Zero to Hero” next, respond or leave a comment.
That’s where the real story begins.

But first, let’s go back in time.

It’s December 24th, 2024, and I just opened my company, Growth Vision Partners.
Yes, you read that right. Christmas Eve.

Why? Because that was the only day I could finally slow down and had enough time to set everything up.

Fast forward nearly one year, and I’ve officially become an overwhelmed founder.
Too many clients. Too many calls. Too little time.

So I decided to reach out to AJ.
Here’s what I told him in the call:

“AJ, I’m an overwhelmed founder. I need your help.”

He replied:

“Yeah, when I read your briefing I said: I’m your man.”

AJ Vaynerchuk is the co-founder of VaynerMedia, which grew from a 2-person startup to 750+ employees and $100M+ in revenue.

He also built the foundation for VaynerX, now the largest independent ad company, and co-founded VaynerSports, negotiating nine-figure athlete contracts.

So when AJ talks about scale, you listen.

Here’s the million-dollar knowledge I got from him.

1. Transfer founder equity

When you move from freelancer to business owner, clients need to understand they’re not just buying you anymore, they’re buying your team.

I asked AJ how to make that transition clear.
He said:

“Grab somebody and have them do most of the work in the presentation and have you just stamp them. Build them up.”

That’s how you transfer trust.

You make it clear that clients don’t just want you.
They start wanting Amanda. They start wanting Rick.

The biggest win?
When your business wins deals without the charismatic founder present.

And as AJ put it:

“The less you’re doing the grunt work, the more you’re making the special magic happen.”

That’s how you buy back time.

2. Coach your way out of every room

As a founder, you should “be there at the very beginning to make sure the client doesn’t feel like the founder disappeared.”

But then you gradually reduce your presence.
First 30 minutes, then 10, then none.

“It’s an investment because, on the other side of it, as you empower your copilot, you buy back a lot more of your time.”

That’s leverage.

3. Stop doing commodity work

Every hour you spend doing commodity work is an hour stolen from growth: meeting new people, learning, improving your offer.

AJ faced this all the time.
Clients often asked for his brother Gary.

His response?

“Gary’s in Dubai meeting princes and sheikhs.”

He turned it into a story, positioning Gary’s absence as strategic.

That’s how you frame it: your time is better spent opening doors for your clients, not pushing slides.

4. Always be reachable

AJ’s take was simple:

“You always want to be reachable. But you almost need to train them.”

Train your clients on what’s a good use of your time and what’s not.
Commodity work? Not. Strategic input? Yes.

And with your team, the key is psychological safety.

“Don’t be afraid to tell me if you need me. People often don’t reach out because they don’t want to look like they’re not doing a good job.”

Communication builds trust.

5. Hire the big guns early

One of AJ’s biggest regrets: waiting too long to hire a senior operator.

“We didn’t hire a proper finance person until we were at $24 million in revenue. That was a mistake.”

(That’s what I call a “different kind of problem.”)

He admitted they were “a little egotistical” at first, afraid that traditional agency people would “poison the well.”
But once they hired experienced leaders, they scaled faster.

His advice?
If you can afford a senior hire, do it early.
And in parallel, “find and train your future CMO before there is a CMO.”

Fun fact about me: one of the key reasons I started my company was to have a team I could coach, people who could grow with me from day one.

6. Build the plane while flying it

I asked AJ whether to hire the team first or secure the business first.
His answer was clear:

“Do it and just figure it out.”

When VaynerMedia won a big client starting in January, they hired 35 people in one day.

Don’t wait for perfect.
Move, then adapt.

But AJ warned:

“But again, measure your success. If you’re signing up clients and hiring on the fly, and those clients are firing you fast, then maybe this is not the right approach for your business because you want to protect your reputation. You don’t want to become a company that does bad work.”

Speed matters but quality keeps you alive.

7. Give them an appetizer

VaynerMedia’s sales process was simple:

“Give them a taste, give them an appetizer so they want to buy the entrée.”

Don’t just show case studies. Use what you already know about the prospect to give them real insight: a mini audit, a small taste of your thinking.

That’s what builds desire.

8. Let the market tell you to f*** off

I omitted it from Linkedin not to be banned because of the language.

“Keep raising the price until the market tells you to go f*** yourself.”

That’s how Gary positioned pricing.

VaynerMedia started at $5K a month, then $10K, then $15K, and at some level, conversions dropped. That’s how they knew they hit the ceiling.

How do you know where your ceiling is?

“Track your success rate and be honest with yourself.”

And think long term: sometimes a higher price can hurt retention.
Margins mean nothing if you lose clients too fast.

The KPI I’m most proud of: every single client I’ve ever worked with came back for a second project. I take that as a sign we’re doing something right.

Closing thoughts

These lessons helped reframe how I think about scaling Growth Vision Partners.

My biggest takeaway?
Scaling a business is about less Enrico time.

I’m not trying to disappear, I’m trying to build an amazing team and give them the space to showcase how amazing they are.

And when clients need me, they know they can reach me.

That’s it. If you liked this issue, hit “like” or let me know in the comments. I appreciate you.

Enrico

First of all, thank you for subscribing. It’s an honor to have you here and to start this journey together. You’re among my very first 100 subscribers, and I’ll always be grateful for your trust.

I’ve spent more than a decade building and growing companies, and for this very first issue, I want to talk about what I believe is the hardest thing in marketing.

I know what you’re thinking… Your mind probably goes to attribution, incrementality, or marketing mix models.

But no, the hardest thing in marketing is defining what marketing actually is.

If you ask 100 marketers what marketing is, you’ll get 100 different answers. And they’ll probably all be right, in their own way.

A brief history of marketing

To better understand what marketing is today, I need to take you back in time.

The first time the term marketing is known to have been used dates back to the mid-1500s.

Yet, it’s only in the 1900s that marketing started to develop, as we know it today. In the early 1900s, as universities began to study it, marketing evolved into an academic discipline focused on how goods moved from producers to consumers. Back then, it simply meant taking goods to market, hence “market-ing”. It was about distribution and logistics, as opposed to persuasion or creativity.

In 1931, Paul D. Converse, a founding father of marketing studies, wrote that “Marketing is about getting goods and services from the hands of producers into the hands of final consumers.”

Thirty years later, E. Jerome McCarthy defined it as “the performance of business activities that direct the flow of goods and services from the producer to the consumer or user to better satisfy consumers and achieve company objectives.”

Then came the modern era. In 1983, Philip Kotler, the father of modern marketing, reframed it as “a human activity aimed at satisfying needs and desires through exchange processes.”

Seth Godin later added a human and empathetic layer: “Marketing is the generous act of helping someone solve a problem. Their problem. Marketing helps others become who they seek to become.”

David Ogilvy believed marketing was a balance of creative flair and research. To him, effective advertising combined insight and persuasion, art and science.

And in 2017, the American Marketing Association defined it as “the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large.”

Why it’s so hard to define

Because marketing is a discipline that spans both art and science. And it’s in continuous evolution.

Every new technology, platform, and consumer behavior changes what marketing is. Each generation redefines it without ever fully replacing the old meaning.

Marketing involves understanding people deeply, aligning company strategy with human needs, and building systems that turn that understanding into sustainable growth.

It’s both art and math. Creativity and data. Short-term performance and long-term brand equity.

What once meant simply selling and distributing goods has grown into a discipline that touches every part of business and society. It’s about creating value, shaping perception, and driving growth through understanding.

And this is why I love marketing today. I remember studying it in college, it felt like fluff, which is why I switched to finance (another story for another day). But once I understood how many opportunities there are to blend data with art, I fell in love with it again.

My definition

After spending my entire career in marketing and growth, here’s how I define it today:

Marketing is the discipline of creating and capturing demand by connecting what a company offers with what people value. It turns strategy into growth by blending analytical precision with creative intuition.

Your turn

Now I’ll turn the question to you.
What’s your definition of marketing?

Share your perspective in the comments or reply directly to this email. I’d love to hear it.

Further reading

If you want to go deeper, here are a few books I recommend:

• Ogilvy on Advertising and Confessions of an Advertising Man – David Ogilvy
• Purple Cow and This is Marketing – Seth Godin
• Building a StoryBrand – Donald Miller
• The 1-Page Marketing Plan – Allan Dib

See you in the next issue,
Enrico

This is Growth Beyond Reach.

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