How Ashton Shanks and the Hemon Agency Went from $0 to $15M a Month in 6 Months

Zach Johnson

Dylan Carpenter

Ashton Shanks

Episode
09
|
Season 1

Ashton Shanks

,

Co-Founder & CEO, Hemon Media Group

How Ashton Shanks and the Hemon Agency Went from $0 to $15M a Month in 6 Months

Settle in for a conversation with paid-traffic savage, Ashton Shanks, CEO and Co-Founder of the Hemon Media Group, a fast-growing agency that’s on track to spend 15M a month in Q4 its first year in business. We’ll light up a super rich 1928 cigarette ad that doesn’t mention a single feature or benefit -- and why it doesn’t need to. Roast an “egg-ceptionally” bad Alibaba ad and pinpoint the 3 reasons it went south. Then see how to apply the counter-intuitive OPM financial principle of real-estate investing to online ad spend to supercharge growth for your agency’s clients.

Key Takeaways

  • The 5 stages of product sophistication and awareness -- why advertising at #5 is insanely challenging. 
  • How to avoid having dynamic creative ding your ad results.
  • The two hottest new tools for getting clear on your 30, 60, 90 day, six month LTV- and which one’s right for you.
  • How Amazon ate Uber Eats, and Postmates’ lunch on food delivery -- and why they were able to do it.
  • Why the journey to higher LTV should never end at 14 days out -- and what to do to extend it.

The Transcript

Season 1
,
Episode
09
Transcript

Zack Johnson:

All right, this is your host, Zack Johnson, and you're listening to another episode of the Rich Ad Poor Ad Podcast. We've got Mr. Dylan Carpenter, your cohost. How are you doing today, Dylan?


Dylan Carpenter:

Doing pretty good on this fine Thursday afternoon, man. Can't complain over here.


Zack Johnson:

Good, man. Well, I'm excited. Well, we're all about bringing the best media buyers today, and diving into the winning ads, and the losing ads. We're going to roast some shitty ads today, Dylan are you ready for it?


Dylan Carpenter:

I look forward to this every single week.


Zack Johnson:

I love it. Well, we've got a pretty, pretty epic guest, who's been behind some pretty big names, and influencers, I think in the online marketing space. You want to do the intro, kick us off Dylan?


Dylan Carpenter:

Yeah, most definitely. You said it best, we do have an absolute savage when it comes to the paid traffic world. Former director of advertising at Traffic and Funnels. I know you all have heard of them. And currently the co founder and CEO of the Hemon Media Group. I want to say under his belt, he's got about 42 million spend. He sits behind the curtain, but I guarantee you've seen some of those ads, because they are juicy. Yeah, welcome to the show Ashton, and thanks for coming on.


Ashton:

What's going on guys, good to be here.


Dylan Carpenter:

Good to hear. Well hey, we'd love to have you introduce yourself. Give everybody a little bit of, what you're getting into in your world over there, at this time.

Ashton:

Absolutely. It's been a crazy 2020 among other things happening around the world. But currently as you said, the co founder and CEO of Hemon Media Group. And we're a brand new agency, we started, only about six months ago. But we've been growing very, very rapidly in the info, and e-commerce spaces. And it's been really fun, dude. In the past 30 days, we've probably hired about eight people. We're constantly building team right now, and it's been exciting stuff.


Dylan Carpenter:

Heck yeah. Well, what kind of accounts are you all working on these days?


Ashton:

Well dude, we've been working, there's client accounts in the e-commerce space, like Redline Steel. A huge steel home decor manufacturing company. We've been also working with some names, I'm sure you guys know. Dan Henry, and a bunch of other people that have been on stages, at the ClickFunnels Awards. It's been exciting dude, people just have flocked in. I was telling someone the other day it was funny just because, one of my passions is building stuff, and growing stuff. But since we started the agency, we haven't had to do any outreach. And so we just been stuck to our gills busy.


Dylan Carpenter:

That's super snazzy. What do you all think you all are managing a month currently?


Ashton:

Right now we manage about 2.6 million a month in spend.


Dylan Carpenter:

What do you think you're going to hit in Q4? That's a juicy number I'd like to hear.


Ashton:

Yeah, dude. I've just been wrapping up some of the Q4, budgeting and planning. I think we'll probably be hitting around maybe 15 million a month, in Q4.


Dylan Carpenter:

I think you just took the top of the chart, from who we've had on the podcast so far.


Ashton:

It's been exciting stuff. Our clients have seen some really big growth recently, and we're just locking in all these structures. So it's fun. I'm sorry if my little son is crying in the background, he's tired of being at home.


Zack Johnson:

He's the guest on today's show, what's his name?


Ashton:

His name's Roman.


Zack Johnson:

Roman, all right. Thanks Roman. Awesome, let's dive into this rich ad. Thank you Asher for this is an epic ad. Let's dive into it, here we go.


Dylan Carpenter:

So yes, everybody has some context. We have Chesterfield Smokes. It looks like an old school magazine ad, blow some my way. I think you mentioned it's from the 1930s, let's go ahead and take it away. And I know you mentioned it's made an impact on you. So let's hear the story behind it.


Ashton:

I love this ad. This ad is actually from 1928. And I've taught on this ad quite a few times. As you guys know of marketing nerds, you guys have heard of Eugene Schwartz's, sophistication and awareness levels. And so what I love about this ad because, during this time, tobacco companies were at the dominance of advertising. These guys were multi billion dollar titans, and they were all battling it out. And this was really before, the government passed all these laws, and they can't really do advertising. And at this time, these companies are spending millions of dollars on advertising. And you have heard all of the claims. You starting to reach, as Eugene Schwartz talks about is the, basically fifth stage of sophistication. The market has heard every offer, every little promise about cigarettes. Which one tastes better, which one has better filters.


Ashton:

This is a long filter. This has a short filter. And then they start doing, we don't need any filters. They come out with all these different pitches. And this is a perfect example of what to do, in stage five of advertising. Especially around this time, because it wasn't necessarily good manners for women to smoke at this time. It was mostly a men's product. And so Chesterfield came out with this ad, of completely changing the script. No longer product focus, no longer promise focused, but they've switched it to now make it almost a sexual appeal. Attraction. Women smoke. And women like actually smoking. And so they're perfectly hinting at this point, where it's not, she's smoking in the ad. But they're talking about how, she's asking for some of the smoke to blow her way.


Ashton:

It's almost a, "Hey, if you smoke it's almost sexy." And women like to smoke too. And in the actual article, where this ad was posted, it talks a little bit about, how she won't just want to whiff. And I think it was a perfect example, of when your market's heard all the claims and all the promises, you completely change the angle, and now it's sexifying it. We saw the same thing with, Axe body spray. Where it's not that it just smells good. It's, "If you spray this, women will be just uncontrolled." They'll just full on grab you, and it's completely changing the advertising angle, and I love it.


Dylan Carpenter:

Oh yeah. And even the whole view from it, the full moon on the rocks with the ocean. They really try to make you feel a certain way with this. And from what you mentioned, rather than going for those perks, "Hey, filters. No filters." This is a complete different angle, which probably does really create a different feeling, for most people who are viewing this ad, I would imagine.


Ashton:

100%. They're seeing this, and they're going, "Man, how cool would it be if I was on a date, and she's attracted by what I'm doing with smoke. And then we'll smoke together, under the Moonlight." It's brilliant work of advertising.


Dylan Carpenter:

I would love to be able to see what numbers this actually did for them too. I'd be...


Ashton:

Yeah, I'm wondering too. I do know that this was one of those ads, that started to change the industry as a whole. Shortly after this, you started to see the other Lucky, started coming out with advertising, more towards women. And they were starting to break that little, "It's not right for women to smoke." This ads started to change some of that. And companies started coming out with more advertising for women.


Dylan Carpenter:

Now you mentioned this, at a stage five level, a little bit earlier. What'd you mean by that, when it comes to this type of marketing here?


Ashton:

100%. So Eugene Schwartz talks about how there's really five stages of sophistication. And, ultimately for example, one is, there's no competitors. You're brand new, you're first to the market. You're coming up with something that, no one's ever thought of before. Stage two is where you're, pretty much there. You're starting to get into the market. There might be a couple other competitors, but you're pretty much in a new market. So, example Tesla saying, "Tesla's all new, all electric vehicle." They weren't the first ones to create an all electric vehicle, but they were pretty much... It was still a pretty brand new product. So all they got to do is introduce their name. Stage three, that's when you start introducing a little mechanisms. Something that makes it a little sexy. So, Tesla introduced, the Tesla Model 3. There's plenty of electric vehicles, but now they can go get an electric vehicle, without breaking the bank.


Ashton:

It's affordable. Stage four, is more around the idea of you're emphasizing on the mechanism. But you're almost avoiding, or saying that you've solved it without another issue. That's where you're saying, "Get X without doing X." And then stage five is essentially, the market's heard every promise, and every angle that people will come out with, and it's almost a dead market. To where if you just did an advertisement, people would almost just ignore it. That's when you've got to come out with something that's completely different, and changing the angle of advertising. And for our ad example, sexifying it, instead of talking about the product itself.


Dylan Carpenter:

I love that. And I think a good example for the more modern day scenario, this is probably the Harmon Brothers, the Squatty Potty. That was just such a crazy video that went so viral, that probably did so many sales. But it was such a different approach on advertising. Most brands, take it away with, and I feel like they changed the game a 100% there.


Ashton:

100%. And that's really what ultimately it's going to have to be, until you come out with a new product. Is you're going to have to change the angles. And that's when you start to see really incredible advertising come out.


Dylan Carpenter:

Well, this is the oldest ad we've had on here so far. And my gosh, does it make a statement?


Ashton:

And that's the craziest part is, this ad itself. Back then, this is not like Facebook. They had think tanks, and it took months of work. And the artistry, and re-changing the copy. And it's crazy to think to me that this ad right here, could have easily taken them four months to do. But it's one sentence, four words. And that's what I love about, reviewing old school copy is just, you know that they put in the work. And a lot of times today, we just hop online, write an ad in 30 minutes, and spend money.


Dylan Carpenter:

Oh, for sure. The amount of manpower behind this probably unreal. That overlaid text took months. Well, heck yeah. That's quite a rich ad right there, and I'm sure that made them millions back in the day without a doubt. But let's go ahead, and take a step out and, go ahead and dive into this poor ad. And I feel like we need to roast something really good. This ad brought back some good sentimental values, but let's go ahead and just find one, and just talk shit about.


Dylan Carpenter:

Ashton, I sent it to your email. Go ahead and open that bad boy. Hopefully you're in the market for egg incubators. You never know. But go ahead and give us your first thoughts on this super, super crappy ad.


Ashton:

Okay. I just opened it. Okay, so this is an ad from Alibaba. And it says, "Save your time and money on global product sourcing. Choose from the world's largest supplier base, and enjoy full order protection." And it's got this picture. I don't even know what that is. It looks like maybe a container for eggs. And I only think that because they have this pic art looking chicklet, next to this massive box. And the headline says, "Egg incubators for sale. Get latest price now." Wow. How did you even come across this one? You interested in eggs bro?


Dylan Carpenter:

I don't remember how I came across this one to be honest, but this is probably one of the most irrelevant ads. And I get it from Alibaba's perspective. Let's just throw a bunch of stuff at the wall, and see what sticks. But, egg incubators of all things. If they didn't have it in the actual headline, I would have had no clue what this was to be completely honest.


Ashton:

Yeah. It took me a second. It's so confusing. Mainly, so you have a headline, that says, "Egg incubators for sale." And you have this picture of this box that okay. I can see that. But the first thing I read was the actual copy. That says, "Save your time and money on global product sourcing." The hell does that have to do with egg incubators?


Dylan Carpenter:

I don't know. They're targeting had to have been pretty trashy. Their image was captivating, I will give them that. But it's like they went to Microsoft PowerPoint, and just add some random photos on there or something. Because that's just terrible.


Ashton:

I love the fact that the image has a watermark logo. It's the Lo Yang thing at the top that says, "Since 1978." But the ad's from Alibaba. I'm so confused.


Dylan Carpenter:

Yeah. That's a good definition of a poor ad, we'd like to bring on the podcast right there.


Ashton:

100%. Yeah, super confusing. I almost would want to click the learn more, just because I'm so confused.


Dylan Carpenter:

I did, and it took me to a product page of nothing incubator related. It just linked to a million products, so unfortunately it wasn't very solid.


Ashton:

Is what we call a poor use of dynamic creative.


Dylan Carpenter:

Oh, gosh. Well, now that we got that out of the way, Zack I know you love this part of the podcast. The Financial Principles. Go ahead and take that away Zack. Tell everybody what they want to hear. Go ahead and, squash it down.


Zack Johnson:

Yeah. So Ashton every time on the show, we like to share with marketers and advertisers, just a few financial principles for scaling their ads, managing their cash. Whether it's leveraging equity or debt. You seem to be into quite a bit of accounts, and businesses that are spending pretty big. So what advice do you have, for somebody that's looking to scale? And what would be the financial principles, that they need to adhere to?


Ashton:

Yeah, ultimately dude I think, especially with the brands that I worked with, and the companies that really start to take market share. Not the ones that just, have this little operation, but ones that are actually gaining attention and taking market share. Those are the guys who can really base their decisions today, on what's going to happen 90 days from now. Even companies like Gore Financial, I don't know if you know them, small startup company.


Ashton:

I'm just kidding, they're a $20 billion financial company. But essentially, when they talk in marketing their teams, when they talk about, what's our our affordable cost per acquisition of a customer. They look at their six month lifetime value. And that's all they base it off of. And so everything they spend today, and they can spend an exorbitant amount of money, which they do, is based on what they're going to get six months from now. And I think that's so key for businesses. I think too many businesses today are working day to day, "What was my row as today? What am I getting back this week? What is my ingoing and outgoing right now?" But the ones who are really doing market share and gaining ground, like even Amazon. Amazon beat everyone, because they can afford to pay for everything.


Ashton:

Recently they started their own little food delivery service. And all they did, was they cut the prices of Uber Eats, and Postmates, and all those other competitors, in half. And they lost money for six months, killing their entire competition, and suffocating them. Because they could afford to pay for it. And now what do they have, they have all these other competitors that will just die off. And they'll stand up, and then they just increase the prices. And that's the power dynamics right there. And that's the longterm thinking and strategy at a high level that, companies really need to start thinking in now. Especially because they are in a world, where they're competing against Amazon, and every other competitor. So you've got to figure out ways, to beat your competitors. And I think that longterm vision is ultimately the key.


Zack Johnson:

And how do you actually break that down, for your clients. You're not only managing their spend, but you're also a plan advisor to these things. Do your clients actually adhere to that? I know a lot of people would love to spend, off their six month LTV, but they just don't have the LTV do it, or they don't have the bankroll to do it. So, how do you see this playing out for, a typical seven or eight figure brand?


Ashton:

Yes. There's a couple of ways that you go about it. One, the obvious thing is, do you actually have things to... People six months from now, are they still even getting marketing from you? That's the first step is, do you actually have a journey that goes beyond seven days, or a 14 day email followup. You have to be continually re-engaging your market. Whether through advertising, or just in backend. If you have a sales team calling them or email marketing, you got to have multiple touch points. That's typically the first thing, is that their touch points are limited to just a Facebook ad, and just email. Or sometimes it's just Facebook. And so if you're not reengaging them longterm, that's the first key. The second key though, if you don't have the money to do it, then it's looking at things like, could you get a venture?


Ashton:

Could you join a partnership there? Or could you get a line of credit? One big thing that, a lot of companies now are doing is getting financing, or some loan payment. Because even if they had the cash, is because they're doing it because cash in their business, hard cash, is more valuable than the three, or four, or 5% interest rate, that you're going to get over the long term. Or even, right now with COVID and everything else going on, your rates are so much better. And so if you can afford, even in the front end to get some financing, for long term, so that you can actually grow the business longterm, that's going to ultimately get you there a lot faster. Than just pouring your own hard cash into the business, when really you should be investing that cash itself into other areas, besides just advertising, or something like that.


Zack Johnson:

Yeah. I think the real estate industry, does a good job of teaching the principles, of always use OPM. Other people's money. Everybody that's ever wanted to flip a house, or do a deal they... It is baked in to that model to use OPM. And I think we're just now coming into it, in the world of advertising of like, "Hey, maybe there is an OPM here in advertising. Maybe I don't have to bankroll this whole thing, off of my own cashflow. Or maybe there's ways to do, joint ventures, or venture, or leveraging debt. Or just, leveraging partnerships in a smarter way."


Ashton:

Oh, 100%. What did we see just recently even with Tesla, and Elon Musk. It's the same reason why, every real estate investor I know, they're not following this Dave Ramsey idea, that debt is evil. They understand how to use debt. And Elon Musk, even when he had millions and millions of dollars in the bank. Billions of dollars in the bank, the dude last year was still going out for half a billion dollar loan. Why is that? Because he wants to leverage other people's money. And that his money is more valuable investing in growing the business. And so if you ever have the chance, why wouldn't you use it? If you're going to pay an 8% interest rate or 10%, well, could you invest your hard cash, or better use of your time, and get back a 20% return? Easy, let's do it.


Dylan Carpenter:

And if the answer is no, I think there's a confidence here. I think if you've got a confidence score of 70, 80% that you can, you should do it. But if it's less than 50%, "I think I could make money." Don't. You should not do that. Gosh, I also want to make a political statement, but just look at the US government dude. It's so in debt. It's fueled our growth for so long. That's for another podcast.


Zack Johnson:

Trying to get us into some Federal Reserve conspiracy theories over here?


Dylan Carpenter:

Yeah. I think that's solid. And, how does somebody get clear on their 30, 60, 90 day, six month LTV? What are some tools that you recommend to your clients, that are fairly easy to work with? Because you're starting to enter into a pretty big attribution nightmare. I only know this because I spent a half a million dollars building one. The early days of [inaudible 00:22:04] the hedge. But what are some of the latest tools?


Ashton:

Absolutely. So, the basic one, if you don't have a budget or something like that, the simplest place is, do what you can with Google Analytics. Using UTM parameters, you can track these customers through multiple different pipelines, as long as they're being tracked correctly. That's the simplest form. But, the two softwares that I really enjoy, one is Wicked Reporting. I actually really like Wicked Reporting. I think they do a pretty good job. They're still a relatively new company. And so, you have some types of those new companies stuff. But the coolest part is in the past, when I had some very large clients working with them, and there was something that we needed, they built it for us. And it was super helpful.


Ashton:

But anyway, with UTM tracking parameters with Wicked, I really like them. A new company that is still starting, but I wouldn't sleep on them, is Hyros, with Alex Becker. He's the CEO over there. And, I have it on several of our client's accounts, and as far as attribution goes, it is incredible. I've never seen anything better than it. And they're building out a lot of the usability with the ad side as well, of being able to actually operate, and physically manage the ads from the Hyros portal. But that's in the future. But as far as attribution goes, it's incredible. I've never seen anything better than it. And the scary thing, is how off you realize the attribution is Facebook. It's crazy how off the pixel is reporting it, or where they're attributing sales to. Dude, you'll see campaigns that you think are crushing it, and you go into Hyros and you realize, you're bleeding money from that campaign.


Zack Johnson:

And how would you say Hyros is different than Wicked Report?


Ashton:

It's really set up for the lead generation spaces. So whereas Wicked is built more for e-commerce, or where it's a very hard, last click model. Hyros is built much more for, really good attribution for, first click, first impression. Last click. And then it has even, a scientific field that I haven't experimented with a ton. But it's using an algorithm to best just direct you whether money's come, whether that was a first click or last click. So it uses attribution windows more, to give you more of a better look at where the attribution really came from. But, I would say if you are a company that has multiple layers, that a customer might have to go through, before it gets a purchase or revenue attributed, especially if it's from a lead generation funnel, then Hyros is incredible at really telling you where that originally came from.


Dylan Carpenter:

And I think he's local in Austin too, Alex Becker. We'll have to get him on this boy too one of these days.


Zack Johnson:

We'll send them this podcast, "Hey, you want to sponsor this?" "Insert our macro advertisers here."


Dylan Carpenter:

Just give me that referral link at some point, you know what I'm saying?


Zack Johnson:

Awesome. Well, thank you Ashton. This has been absolutely killer. You're doing awesome things, in the agency and congrats on the early success. You're managing some big ad budgets over there so, killer.

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About The Podcast

Jason Hornung is the founder and Creative Director at JH Media LLC, the world’s #1 direct response advertising agency focusing exclusively on the Facebook ads platform. Jason’s proprietary methods for ad creation, audience selection and scaling are responsible for producing $20 million + of profitable sales for his clients EVERY YEAR

Zach Johnson

Zach Johnson is Founder of FunnelDash, the Agency Growth and Finance Company, with their legendary Clients Like Clockwork solutions. Under Zach’s leadership, FunnelDash has grown to over 5,000+ agency customers managing over $1 Billion in ad spend across 41,000 ad accounts on. Zach’s private clients have included influencers such as Dr. Axe, Marie Forleo, Dan Kennedy, Dean Graziozi to name a few. Zach is also a noted keynote speaker and industry leader who’s now on a mission to partner with agencies to fund $1 Billion in ad spend over the next 5 years.

Dylan Carpenter

Dylan Carpenter will be diving into what he and his team are seeing in 200+ accounts on Google and Facebook when it comes to trends, new offerings, and new opportunities. With over $10 million in Facebook/Instagram ad spend, Dylan Carpenter had the pleasure to work with Fortune 500 companies, high investment start-ups, non-profits, and local businesses advertising everything from local services to physical and digital products. Having worked at Facebook as an Account Manager and now with 5+ years of additional Facebook Advertising under my belt, I’ve worked alongside 60+ agencies and over 500+ businesses. I work with a team of Facebook, Google, and LinkedIn experts to continue to help companies and small businesses leverage the power of digital marketing.

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