Selling Premium Products, Acquiring Customers Off Amazon, and Getting Influencers with Athletic Greens

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Hey, Fastlaners, Ryan Daniel Moran here. And if you sell physical products than I predict that today's episode is going to be one of the best podcasts that you hear. This year I'm going to be speaking with Chris Ashenden. He's the founder of Athletic Greens. If that name sounds familiar, it's because they've been featured in the Four Hour Body and they have been talked about by Tim Ferriss as well as Lewis Howes and a bunch of other influencers. And I take it myself. I sometimes take it in the morning with some creatine, sometimes my sheer strength fat burner I'll throw in there. And that's kind of my morning. All inclusive. Gonna win the day. Mix up. So I asked Chris to come on and talk about their brand and how they have established themselves, as I call them market whales. They've eaten up all the competition. I originally met Chris because they were looking for help with their Amazon presence. So some of the members of this team, the fluttergreens team, are in the back room and we work together on tweaking their Amazon strategies. And they've had phenomenal results as a result of us working together. But today I wanted to talk about how they have maintained high price points because they're three times the price of most of their competitors. They also have a very different marketing strategy than most people and they pretty much take an understanding that they're probably not going to make a lot of money on the front end of a customer acquisition. They make all of their money on repeat customers. So their model is more of a subscription model. And they do things very differently than your traditional Amazon seller or really most physical product sellers. You're really going to benefit from how Chris talks about how they get influencers. And the way that they get them is not how you think and it's not the way that most people who come to me and ask about getting influencers are trying to do it. They, they do it very differently. In fact, when Tim Ferriss came to them and they were talking about either working together or Tim was talking about endorsing the product. Tim put them through the wringer, Chris says. And most of the reason why they get exposure is because of the way that the product is positioned, because of the quality of the product and for very little else. So you're really going to benefit from this different type of thinking. And I hope that this challenges you and stretches you to think about your product as the best possible marketing tool that you have. It's so easy to get lost in this world of thinking about reviews and rankings and marketing hacks, when in reality, we are serving people. And if you know who the people are and you know how you help them get closer to their goals, marketing becomes really, really easy. And that will be your takeaway from this chat with Chris Ashington.

Hey, everybody. Welcome to Freedom Fastlane. Today I'm joined by the founder of Athletic Greens, Chris Ashenden. Did I just call you Chris Ashenden? Chris Ashenden, thanks for hanging out with us on Freedom Fast Lane, mate.

Great to be here. Thank you, Ryan.

Yeah. So, Chris, I know that Athletic Greens has been. And you basically built the greens powder market, and you've done tremendously well as being a first mover in the marketplace and being endorsed by a lot of people. I was hoping you could share a little bit about what you thought it was about Athletic Greens that made it so much more successful than all the competitors. And I know the temptation is always to say product quality, or maybe it was that you were first to market. But I'm curious, did you do something different with the marketing? What do you think was the reason why you were able to claim such a firm stake in the ground and what is now such a competitive market?

Well, Ron, firstly, thank you for the accolade. We weren't actually the first to market there being greens products in various shapes or forms for a significant period of time, and for a very long period of time, they were in the domain of one of a better term hippies, effectively. So you had a lot of people mixing powders, and for a long time there have been some quite established green mix powders around. I think in my case, when we kick this business off, there's a pretty significant backstory there, which we can or we don't have to go into if you don't want to. But when we kick this off, I actually think I made a big mistake by calling Athletic Greens greens, to be honest, because we're ultimately so much more than a greens product, but we've been pigeonholed against the other products that are literally just powdered vegetables. So what I think actually was our true determinant of success was just an unrelenting commitment to product quality. Would have been the first one which allowed us to get some pretty strong recommendations from people who really put their own personal brand ahead of nearly anything else and business model. And so I think it was the combination of those three things. So we have a very high efficacy product and we have some pretty big influencers who have said we really dig what you're doing and put me through the grill. Typically before they would subsequently make any recommendations to their followers. And then business model, and by business model I mean we built a subscription business. So it wouldn't have worked if we hadn't done it. Subscription.

Yeah, I'm curious to go into that. I want to come back to that statement of it would not have worked had it not been a subscription business. But you're right, you had a lot of really early influencers before it was cool to have influencers endorse your product. Athletic Greens had people talking about it and I so often get asked the question how do we recruit influencers for our product? And what I'm hearing you say is, well, have a really great friggin product. That's how you do that. Would you add anything to that?

Yeah, no, I wouldn't add anything to that. I think too many people in the world now jump out and focus on their marketing instead of actually building something that is good, but really good. And I think one of the biggest differences that we had is we I misnamed the product, I probably ultimately over engineered the product, but I have no regrets therein. And I think that most of my marketing mistakes, and there were a lot of them revolved around trying to be more aggressive and make the marketing do the work for us, when in reality I think a strong marketing campaign, intelligent marketing campaigns in whatever channel that you're trying to make work is really important. But I think ultimately if you don't have something that is quite different, you're unlikely to have someone continue to be your customer, which was the key to our success, or refer their friends to be your customers which was the second key to our success.

And why do you say then that had you not had a recurring model that the business would not have worked? What do you mean by that?

Okay, well when I first started, I have a background in health and fitness and I went to university and studied a BSc in sports and Exercise science at the University of Auckland. And I've dabbled and played in health and fitness businesses my whole life. But I actually my early business focus was in property and finance and when that all kind of went south I was in the middle of some pretty serious health challenges and I wanted to really focus on getting my own health sorted out. And in that process I ended up looking for, for want of a better term, sort of this super supplement that ultimately was going to be primarily for me. And I sort of was chatting to a mentor of mine who was quite a wealthy guy. And we got talking and in the course of a lunch, we used to catch up quite frequently in the course of a l. I got him very excited in this particular idea. We literally, over a handshake, became business partners and he agreed to finance the development of this product into a more formal nature. I don't really know much about the uhet supplement market. I didn't, I don't know. I didn't realize just how much I did not know. But what I did know is that when we finally had this product done, it took a lot of investment to make it taste as good as it does and also just really track down the right suppliers of each of the key ingredients to make something that I felt, look, this is just what I want to take every day. So sort of everything I could possibly want with a few exceptions, basically in one spot. And I built that, went to the US and figured because I'm quite good at selling face to face, I've always been a people person. I like helping people. I figure how hard can it be to sell stuff online? And I found out very quickly, I hear the chuckle. I found out very quickly it's not the same and it's a whole other skill set. And I promptly went through all our cash reserves trying to figure out how to sell this and then realized and everyone I spoke to, and I spoke to a guy at a 300 million plus natural products natural cosmetics company who tried the product at one of its early iterations and said, look man, we'd like to come on board and open doors to.

The president, CEO or head buyer for each of every major retail chain you could imagine in the US he was in over 20,000 stores with their key products and in return they take a small percentage and sort of come on board in that fashion. And he then asked me what my margins were and I told him, and he said, I'm sorry man, unless you significantly increase the price or dramatically dumb down the product, you're just never going to make it work. I said, well, I'm not willing to do that at this time. And I didn't do it. When I spoke to some more direct response guys who had the same thing, they said, look man, with that, with that margin, you're the worst margin product I'd ever heard of in the dietary supplement space. I said, there's no way, you'll be able to recoup an intelligent acquisition cost for your product. Bear in mind, by now I'd run out of the cash. I had my financial partner very unhappy with me. And I sat there thinking, look, the people I've given the early beta versions of this to are still taking it, they're still ordering it. The vast majority are taking this stuff every day, just like we intended. And I just believe that even though we had horrendous margins, that if we could get enough people to stick around long enough, ultimately the subscription model could actually make it work. And so we just decided, well, that's going to be our focus. We'll give a very big discount to people if they take up one of our subscription offerings. I had a friend who offered to send various emails to sort of our early attempts at a home site and landing page, and there were 11 renditions of those before we got one to actually kind of convert. And in that whole process, everyone said, you're never going to make this happen. It's just never, ever, ever going to work.

I had enough then, enough people of pretty significant influence who said, yeah, man, I love this product. We have a big database of customers. When you have the product ready, we'd be delighted to promote you to our database. And this was all sort of occurring towards the end of 2010. And one of our early beta testers was a guy called Timothy Ferris who just put me over the grill with the product.

I've heard of him.

Yeah, he might have heard of him, he's all right. But he absolutely put us across the grill in terms of product quality and everything else. And we got to, we were sort of about six weeks away from sort of our final rendition of our website. And I can remember thinking, you know, I've really made a mistake. And I probably shouldn't have called it athletic because it's really not just for athletes. And I probably shouldn't have called it greens because there's this rapidly growing field of other greens products that are just powdered veggies. And there's nothing wrong with powdered veggies, but we're a lot more than just powdered veggies, so to say. And I emailed him and said, hey man, let's get on a call if you don't mind. I'd love to pick your brain about potential naming options for this product because I really don't think we should call it athletic greens. And he sent me back a one line email saying, don't change the name. I put you in the Four Hour Body, it's gone to print. And that was literally the first time we heard of it. And for our body went to print, we didn't change the name. That gave us a huge amount of credibility. And then once we had that landing page up and running, people started to come, and when they came, they stuck around. So we had very, very long on a product revenue basis, lifetime customer value. And even though our margins were terrible, we've worked unbelievably hard over the last sort of seven years to try to improve our margins without skimping product quality at all. And in fact, we've made 50 improvements to the formula since that first rendition. But, you know, it's been an uphill battle. But I think actually, and something I realized afterwards is that if people, enough people stick around, enough people tell their friends, then it's not really margin that matters. It's the relationship you build with the customers and the value that they are willing to give you for the product that you provide to them.

So I did not realize that the Four Hour Body was really the first major splash that the product had into the mainstream. How did you carry that momentum from there? Because it's one thing to get a mention from someone who has a following, and those are really nice days when you get kind of that spike or you get that push. How'd you maintain that? Once you had a core group of customers and you started to turn on the marketing engine, what did that look like?

Well, what happened, Ryan was so Ferris said, look, you're in the book, and I actually regret not changing the name because it still causes us all sorts of headaches. And we have enough water on the bridge and enough brand space now that we're not going to change the name Athletic Greens. But what it really did, I mean, if you're reading a book, a print book, it's not like you're clicking through to a website. The number of orders we got off that print book were solid, but it wasn't huge. What we did get was very significant credibility with a lot of people in the health and fitness space who read that book and then had tried us. And then they said to us, this is pretty awesome. And we said, we're glad you think so. And if you'd be interested, we'd be delighted to talk about how you could share our message with your customers for an affiliate commission. And we gave lifetime commission. So we had very little free cash flow for a long time. But the reality was it was the subscription model that built the momentum because it wasn't just someone coming to try us. Once most people took a subscription option as they checked out, a surprising number, actually. And most of those who took a subscription offering stayed around. And I think many people stay away from this particular offer structure because one, a lot of people have been really annoyed by subscription models. But when we just upfront, like, pay your money upfront and if you want, you can go on subscription, it's slightly cheaper. But I think a lot of people stay away for a number of different reasons, but mainly because their product just isn't good enough. So they'd rather just try to slam people into buying as much as possible on day one because. Because they know they're not going to come back and keep buying. That's fortunately for us, something that ultimately was both a boon and caused all sorts of headaches. Because I'd run through the many hundred thousands of dollars of operating cash I had to try to get the business started. I had a significant proportion of inventory and significant R and D and development costs that had to be recouped with the subscription. We thought, okay, surprisingly, people took a subscription at checkout. And the following month, almost all of them were there. And the following month, again, almost all of them were there. And we'd had significant influences sort of mentioning us to the email database would come out. We'd be mentioned in a Forbes article as being Tucker Max's fridge. I don't even know how that got there because that was before I even met Tucker Max. But thank you, Tucker Max. And there are a lot of these things that kind of came together to say, well, we weren't having this crazy growth of new customers every month. They were all. Well, not all, but almost all coming back. So you can imagine the compounding effect of that. And that literally happened for the first two years. So we ran out of inventory, and we launched in December. I think we ran out of inventory at the end of March in 2011. And there's nothing worse in a subscription business than running out of inventory. It was, yeah, we were planning to fly. We make this stuff in New Zealand. We're paying to fly this. As soon as it came off the line, it was just on a plane, on a plane, on a plane. And we're getting even more slaughtered on margin. But ultimately we surmounted that, surmounted the cash flow hurdles of having very long lead times and very high cost of goods sold. And we surmounted it literally by that reorder rate and the referral rate we had. And we now have even more. A staggering Amount of orders come from referrals. We're over 80% referrals as a business in terms of how we get our customers.

There was an old video by Frank Kern, say what you will about him, who used to say, I thought this was so beautiful. Most people lead with a marketing and sales strategy and then a crappy product. But if you have a really great product, that is the best marketing and sales proposition that you can have, which is what it sounds like Athletic greens has been built on. So tell me about the marketing and sales strategy. Have you had to kind of reinvent that because you're not willing to go the way of everyone else, or have you found something other than word of mouth that gives you new customer flow or have you just focused on affiliates and ambassadors?

We've done all of the above. So our initial success round really built us very quickly. Over two years and everything worked for about two years. And then I don't know if it's fortunately or unfortunately because ultimately there are many lessons learned. We began experimenting with our own paid, effectively cold media customer acquisition. And of course we still had a high cogs product, but we thought, look, if we can get more people to try this, it's a great product. We should have more people stick around. But ultimately the path we went down had very early initial success. We were advertising a lot on Taboola. It was a short article. We tried experimenting with different offer structures. So we moved away for the first time from full priced offering to sort of. We tried a free trial that was disastrous both from a customer experience perspective and a brand perspective, let alone a financial perspective. We then tried a 50% off and that was disastrous again from all fronts. And I mean, we are a very premium product. We make no qualms about it. We're not for everyone. These are for people who want the best and that's what we deliver. And it just didn't work. But unfortunately, the very first month or two, we really thought it did work. I mean, our business grew 300% in 90 days in terms of a revenue number. And so that's pretty heady stuff for any entrepreneur. We were sort of going, wow, this is amazing. And the theory was we'd have many more people sort of come into the top of the funnel and just by sheer volume, ultimately we'd end up with more great people at the bottom of the funnel and it didn't work out that way at all. And we went through this process for about two years where most of our traffic was coming from some format of paid media. By then there were many, many competitors willing to say a lot of things to the bulk of our email traffic. And we just weren't willing to say those things, nor did we have the margins to sort of do some of the things that others would probably have suggested that we did. So we had to reinvent ourselves. And what we realized is who are our core customers? Why do they buy from us? More importantly, why do they stay buying from us? And even more importantly than anything else, what? Why would they recommend us to their friends? And we did survey after survey after survey and realized almost all of our effective gross profit was coming from people who had been referred by strong customers. And various marketing efforts which by then had gotten very aggressive, would run after the money for want of a better term. And we never compromised on product quality. Like I said, we've continued to iterate and improve there. But for a little while, I apologize to everyone who's ever touched our business. We did what I now realize was a lot of stupid shit and it just did not match our product, it didn't match our community, it didn't match anything and it just cost a huge amount of money. It generated wonderful top line numbers, revenue numbers, terrible profitability and it just didn't work for our brand. So we've literally in the last 18 months completely overhauled everything that's the look, the feel, the marketing, everything that we thought did not reflect who we wanted to be and the problem we're trying to solve and the value we're trying to create, we just stopped it and didn't matter if it was profitable or not. If it didn't match the brand mission, we stopped it. And it caused some months of extensive pain. But ultimately it's since gone on to really vindicate itself, particularly in the last eight, nine months where Atheta Greens is on a runaway path right now.

Explain to me how something can triple your top line revenue and be a disaster. And also I'd like to hear you comment on, it's really popular to do + shipping models and to do discounts in order to get customers. And most people would say that's like one of quote the ways to get customers. So why was it such a disaster? Why didn't it work for Athletic Greens?

Well, I think you can do short term, not huge discounts, but ultimately how many businesses can you name that have been in market for a very long time that consistently discount their core product offerings? The world's best non discounter, which everyone throws out all the time. So I'm sorry, I'm going to throw it again is Apple. Try and get a discount on Apple. We once bought 18 MacBooks of Apple at one go. They gave us a 6% discount. They said we don't normally do this. So I think it pays to remember that if you're not a premium product, you might do all sorts of things to try to get people to come across and try you. And we've experimented with some of the other things that we're involved in and trying to see does this actually work. But our findings were really astounding. We got more than double the conversion when we went to a 50% off. We got way more than triple when we went to the free trial. But our cost structure is such that someone has to stick around for a long time or else we were losing money. Their experience also has to be positive. And people who aren't willing to open their wallet for us at full price probably aren't the type of people we'd want as our customers. We are a premium product. If we can't articulate the value cleanly and we're resorting to some aggressive discounting or something else to get it out there, then it just didn't work. We didn't end up with the customer experience that we wanted and we didn't end up with the customers that we wanted. We got some. I mean some of the people have been with us for a very long time, came through those various acquisition formats, but it wasn't our core customer. Core customer is someone like you. Right. And in reality, I think free plus shipping could work for a very low cost setup. But then most of the people who are doing that, and let's face it, when I do a free plus shipping, they're recouping their cost of goods sold in the shipping part of that component. They're not going in the hole for three to six months on that acquisition. Different strokes for different folks. I would recommend that people who have a high quality product, if it is the right customer, you can offer them all sorts of things. I think if it's not your right customer, it pays to have a threshold for the customer to prove that they are. Actually they're in a situation where paying $80 a month, $100 a month for a premium high end supplement isn't going to cause them to kick and scream.

Would you talk a little bit about that pricing strategy and how you've been so defensive on keeping your margins to where they need to be? The reason I ask is because I get a lot of questions specifically from people who sell on Amazon, who are concerned about price wars. And I tell them if you're in a price war, it means your product isn't different enough or you're at least not positioning it differently enough. But you have always been at that top of market and you've kind of committed to that. So would you comment on your strategy there?

Like I said, I made an error, Ryan, and calling it greens because everyone's why are you more expensive than this greens? Well, that's kind of just powdered grass and broccoli and it doesn't cost that much. Nothing wrong with powder grass and broccoli. It just doesn't cost that much to put them in there. By the time you put in all the different vitamins, minerals, extracts, the probiotics, the prebiotics, the various mushrooms, everything else that we have in there, the cost goes up dynamically. But it's no longer just the greens. This is an ongoing battle that we have all the time. But from a pricing perspective, we've tested our pricing and we've more recently actually gone back to what was originally our best performing pricing on our home site for people who take the subscription. And for a little while we had it higher and it gave us actually a better result over 90 days, but a worse result over 12 months and a significantly worse result over 24 months. So again, people don't always take the longer term horizon into account. And we tested pricing side by side and realize, wow, at 90 days this one's more profitable and allows us to get more money back into acquisition and growth and all these other great things. But at that stage we just sort of hit a point where, okay, we're not getting as many referrals per visitor that comes to our site and these people aren't staying around as long as we'd want them to to truly get the benefits of improved cellular health, which is the business that we're in. Is this what the product. So we've stuck to our guns for the first three years. I didn't discount a single time on Icorp product, not once, not nothing. And I kind of wish I'd stuck there, to be honest with you, man. And then I had two years of testing everything under the sun to try to maintain that initial crazy growth spike. And you asked earlier, how can you have 300% growth and not have it profitable? It's simple. You acquire the wrong type of customer, which is what happened.

That's interesting because I was going to ask next, how important was it for your success to know exactly who the customer was. And it sounds like that when you didn't know and you just went after sales rather than a person, that the performance of the company really suffered. Is that accurate?

It is accurate. And also I think we need to be honest that when we first started 2011, 2012, there were green products in the market, but there weren't many. And it was sort of very much a growth phase for the whole green space. So if you're new and interesting, more people are willing to open their wallet to try you versus if you're now, you're still interesting, but now they can directly juxtapose you to a host of other products that range from $19 to say, $40 or $50. These days, everyone and their dog has some format of green product. And it's no longer just those who say, oh yeah, this is, I can go get the same thing cheaper at Safeway or wherever. And I think we realized actually we need to focus more on who are the people who get the most benefit from using our product and then who are the people who ultimately stay with us the longest. And there is an overmatch. And we ultimately came down to two avatars. One is the high profile. Sorry, what do you call it? It's a go getter. We define it as a go getter. And it's someone who's both of the means and quite willing to pay for the best. They tend to be looking to improve their lives most of the time. They're definitely not couch potatoes. And they exercise to some degree. They could be a weekend warrior, they could do yoga a few times a week, but they're definitely not sitting around us hoping for some silver bullet. And they tend to be focused on self improvement and bettering themselves in some way or another. And that was sort of one. And the other one was anyone who had any formative irritable bowel problem. So anyone who had any sort of digestive distress, we typically get very rapid changes from taking our products. So those two avatars ultimately are the two groups that we've had the best success focusing on in our marketing efforts. But if I could pick one and say, this is the person that ultimately typically ends up being our best customer for a certain period of time. It is that person who is looking to be the best version of themselves. And they are already taking action to some degree of that respect and definitely not the silver bullet, Hail Mary crap.

When you know exactly who that person is or you at least have the avatar defined, since you're so committed to keeping your marketing above board. How is it that you're going out and getting in front of as many of those customers as possible?

Very slowly, slowly and steadily. And we no longer try to spike our top line revenue number for the sake of growth. We want lasting enterprise. We want predictable, sustainable cash flows. We want customers that love us, we want customers that refer us. And that means bringing the right person on for the right reasons, not overselling them on anything, just being very honest about what it is that we do and the value that we present and just trying to do the right thing by your customers. I think over an extended period of time goes a long way. And I think with the changes in the online business, there are a large number of businesses now online where if you actually look at their P and L and you say okay, what proportion of your revenues came from existing customers versus what proportion of revenues this year came from new customers? A staggering number will give you some number in the realm of 70 to 90% of their revenues this year came from new customers. You show me any business to consumer company in The S and P1000 who says that? Show me one. It's the opposite. It's more like this year we had 10 to 20% new customers and the rest of our business came from repeat customers. So we really focused on being on the reorder business. We want people to be delighted to continue to be our customers and if they're delighted, they'll tend to tell their friends. So when that's the case, you don't need our effective CPA on a monthly basis with a high proportion coming from from referral is extremely low. We don't need to throw the hammer down and just crank this for revenue target. We're not chasing a sale or an exit. We're not VC funded. We're closely held and our real focus on is long term business, long term relationships with our customers and continuing to be what we hope is still and I believe it is, I'm just biased. The world's best supplement if you're going to take one. I still stand by the fact I think I've got the best one on the planet.

I completely agree on all of the money and scalability is after someone becomes a customer. And it's been my opinion that the longer you can delay the profitability of a customer, the more you can spend on that customer acquisition. And that's usually who wins. The person who has their ideal customer really dialed in, they know how to get in front of them and they get that person coming back more and more.

Hey, Fastlaners I want to talk to those of you who have been listening to the show, have done some of the things that we talk about, and have grown a physical products brand to over $100,000 a month. I have a mentoring group called the Backroom that is specifically about going from 1 million to 10 million. I have built businesses that have gotten to that level. I've also helped a handful of people grow from 1 million to 10 million and others from 1 million to 5, 6 or 7 million. I recently got a Facebook message from one of our members who went from just over $100,000 a month to crossing $600,000 a month in his time inside of the back room. So if you are running a business that's already selling at least $100,000 a month and you need someone or a group of someones to be driving you to constantly go bigger and also have the playbook to go from where you are now to getting to that eight figure deal, I would encourage you to apply for the back room. Our vision for the back room is to keep everyone on track towards hitting eight figures. That's $10 million in sales. And then over the next couple of years, we're gonna be focusing on doing rollups, meaning packaging certain businesses together and selling them for way more than one business would sell for on its own. So as a result, you'll make a lot more when you sell your business as a result of partnering with other businesses. That's the backroom deal that we're working on. So you can apply for a spot@capitalism.com.

I don't work with everyone. I want to make absolutely sure that we can help the right businesses because our success rates are really high and that's more important to me than the membership fees. But if you might be a fit and you're doing over six figures a month, I encourage you to go to capitalism.com backroom. If you're not at that level yet, you might be a fit for the tribe. Or one of our training programs, which you can also find@capitalism.com and freedomfastlane.com.

I'm curious how your business has had to change in the last 18 months since you started to strip out all the stuff that even if it was profitable, wasn't on message. Where do you put the focus of your advertising and your marketing now that you've kind of stripped out all the junk?

That's a good question. So now the focus is on smaller campaigns, very audience targeted, just looking to present our message in front of the right people. And we find that it takes significant impressions. We're not doing some. They see us once and click through into a big VSL and voila, they've taken something. No, we find that they need multiple touch points. And subsequently, with that very concise audience, this is what the new CEO, who is doing outstanding job, is doing so well on athletic greens, is just really dialing in the acquisition to just the right customers and no one else. So our top line numbers are growing month after month, but not crazily. It's just a much happier enterprise. We're not dealing with people who effectively got oversold to some degree and now want to bail out. That's great for morale. It's great for the business. Our percentage of referrals as a percentage of new customer acquisition is the highest it's been since 2011. 2012. I'm a big believer. I met Drew Houston from Dropbox and he gave a little presentation on how to go from 0 to 2 million users. This was in 2009 when I met him. Now they have a hell of a lot more than 2 million users and they had a bunch of very smart people in a room trying to figure out how to make Dropbox work on every device. They had a bunch of equally smart people in a room trying to figure out what do we have to do such that when someone joins and signs with us we get a very high referral coefficient. And they were looking at the number of people who would effectively be referred to acquire per customer. And that was their key customer acquisition metric. I'm just going from memory. I think it was when they moved that from 1.08 to 1.2. That's when literally things started to get crazy.

We originally met because your CEO wanted to expand your presence on Amazon. How does that play into the overall strategy of taking a front end sale on Amazon, but really making the majority of your money from repeat customers in the back end? So how does Amazon play into your overall strategy as a company?

I think anyone who has a physical product and they're not on Amazon are missing the boat. And ultimately Amazon is the biggest department store in town and there are some people who just prefer to order off Amazon and it costs more to order on Amazon than it does to buy from us on a subscription. So I think the reality is that there are some people who are only going to buy on Amazon and that's just the way it is. And there are plenty of our subscription customers who also buy on Amazon. And over time I think there are people from Amazon who come across to buy from us. And I remember the old adage, which is make it as easy as possible to do business with you. And then others, of course, have a do you qualify? Approach. And I think that they're both correct, depending on the circumstance. But in this instance, there are some people who just want to buy on Amazon. Make sure you serve those people really well. And of interesting note, when we sent some of the emails to our existing database saying, hey, something's funky with the Amazon algorithm. We should be at this very high percentage reviews, we'd love you to go and give us a review. And when we did that, these are our core subscribers who've been with us for a significant period of time. When we asked them to go on Amazon, their reviews all came up as verified buyer reviews, which means even the people who are most long term loyal subscription buyers and we absolutely look to reward that loyalty and have actually bought at some time or another on Amazon. So I think anyone, even in our space, where we definitely are a subscription business, should realize, yeah, man, your people, they have one pack and they want it tomorrow. They want two tomorrow they're going to do it on Prime. And that's okay. I think it's okay to realize that. But that was something I found quite staggering that it happened.

I've had fun on that process for sure. I'm curious if now that that has become more of a focus, if the rest of your business has had to adjust at all, has Amazon changed the overall strategy of the rest of the business or do you see it as a supplement to what you're doing on the other side?

It's a supplement to what we're doing. And we know that some people will just want to order on Amazon. So they might even come to our site and just go to Amazon and go, well, we'll buy it on Amazon. I was like that for quite a long time. I was like that. But I think that to ignore Amazon is at your peril in terms of a focus of the organization. The key focus for us is still to acquire and deliver, acquire amazing customers and deliver an amazing customer experience. And on our home site. And Amazon has a significant degree of focus, but it's not more than 10% of the effective energies of our organization. It's 90% on our core business, which is deliver ourselves an amazing customer experience. I remember you asked earlier before we jumped on the call, what were some of the keys to our success? And I mentioned that we'd had a number of very, very, very financially successful people say, you'll never make it work on your margins. When we'd crossed a certain threshold, I decided to send every customer been with us for six months or more. And we went six months, one year, two years. We sent them a wow. Box, and it cost us $250,000 at cost to basically package up a box. The top folks got shoes, T shirts, free product books, and everything else. And we just sent them and said, thank you so much. I was very humbled. And I said, thank you so much for your loyalty. And I was very humbled because ultimately I'd had a dream of building this business. I'd taken a product that had done amazing things for me and shared it with the world. So I'd solved my own problem and shared that with the world, and it had grown to something. And here these people had opened their wallets and their trust and had taken this product that we'd spent a lot of time building and had taken enough of it and referred enough of it and continued being customers of ours that we'd become sort of financially stable and weren't trying to hit, figure out how to pay for the next purchase order. And we're a very robust business now. And I think at that moment, man, I was quite tearful and I sent all these out. And the hilarious thing that happened was years later, as we started to build out our business intelligence and look far more concisely at what various activities have we had that have ultimately impacted customer attention or customer referrals, that wow Box experience was a net positive roi, and I never would have imagined. I thought, this is just a thank you. I'm giving back. But in actual fact, our customers loved it.

That amazes me. But if you can make that up on the back end over time because of the customer loyalty, that makes sense. So, Chris, once you had one product really take off and really establish you as a respected brand, how do you follow that up? What's kind of the strategy from. You know, how to get customers? You have one amazing product. What's the process for you for growing from that point? Or do you just try to maximize the one product's positioning in the marketplace? What's. What's your strategy?

That's a great question. You have a lot of great questions today, Ryan. I wish I'd had more coffee so I can give better, better answers.

You need athletic greens coffee, man. Next product. That's how you'll answer this question.

You never know. We've really focused on continuing to invest in our core product, and that is just keep making it better and try to increase the moat between us and the competition. And I think stopping doing that would not be an intelligent long term plan. So that has ultimately been the core focus. And where we've developed secondary products has been a response to asking our customers what would they like and also what else are they taking. So we've done an okay job of delivering our customers on the effective back end those other products. But in terms of a sort of runaway march through and decimate the market in a new very, very distinctive product. We're working on that now. And it's a process of match between what do customers truly want versus what do they need and how do we feel we can best invest those efforts. So literally a core product has a message around. You don't really need to take anything else and you don't really apart from fish oil and, and D3, which are both oil based and therefore don't look or smell particularly good in a powdered greens product. So those are separate and they're in oils and those sort of three together would be the perfect trifecta. In fact is the trifecta that I recommend my parents take and they do take on a daily basis. But for the next product we're trying to consider where and how do we do this. I think there is 10 times the size we currently are just on the athletic greens core product over time and I think the how do we best figure out what next product do we truly build? To be a world better is sort of a challenge facing a new CEO and his awesome team at the moment. And I'm pretty heavily involved in that process. But we have a few ideas, man. It's just verifying that's actually what the customer wants as opposed to just assuming it's what the customer wants.

Chris, I wanted to end with you talking a little bit about your strategy for acquiring amazing people. And one of the things I've noticed about you is that everyone on your team seems to be kind of relentlessly committed to what you're doing. So I don't know how long you operated the business by yourself or how big the team is or has been at its biggest point, but would you talk a little bit about bringing really great people on to build your vision?

Well, it's biggest point we got to 58 on team. We've narrowed that down a bit now. But I think if there's that saying. I remember a saying, there's quite a neat book by Tom Peters and it's called Little Big Things and he talks if in doubt and you have two People that seem to be equally good on their interview. Hi. The one with a twinkle in their eye. And it's quite a good quote actually. And we've just found that that has been great element. If it's not enough just to be really smart and just to be really hungry, they have to have the twinkle in their eyes relates to what it is that we're trying to do and we're trying to be. And I think we probably are, but we're trying to really be the world's most recommended supplement and just really get out there and help as many people as possible. And those that buy into that idea really enjoy coming from typically their larger corporate backgrounds. And some investment bankers have come across, some folks from very high end corporate, higher paying jobs have come across because they like being a part of a more nimble, more growth focused, more customer focused team. And they do enjoy that feeling that they're making the world a better place. So everyone on our team is very committed to making the world a better place. And I'm quite sure that if I started taking shortcuts to say halve the cost of goods sold of athletic greens or overzealously making claims about what a product can and can't do in an effort to acquire more customers very quickly, those people would become disenchanted and I think the better of them would leave. I think that's one thing, man. Just like being true to message is the long term path to success for your brand, I think being true to message is the long term path for success for your team and offering the ability to really grow. And I push them. When I was hitting it, I pushed him. And the new CEO, Adam Trantzer, he is outstanding at empowering his people and pushing them. And good people like to be pushed.

Chris, I make it very publicly known that I think entrepreneurs make the greatest change in the world versus anyone else. And when you have something like athletic greens, which has been so good for so many people, I would go as far as to say that Chris Ashenden has probably done more for health care than Obama and Congress have ever wanted to do combined. Keep on changing the world, buddy. If somebody wanted to either follow you, I don't know that you do that much publicly, but if they either wanted to follow you or they wanted to find out more about athletic greens, how would they do that?

I don't do much publicly and thank you so much, mate. That is, that is a heck of a thing to say and well, it's.

Kind of a low barrier. Like a low.

I don't know that it's that hard to do more than Congress and Obama did for Health or Trump or whoever. But you're welcome.

Thanks man. I don't do much publicly, but the business, they can find out more@athleticalgreens.com and that's probably the easiest place to sort of see more, hear more. And we're making some changes over time to the look and feel of that site and you can see my ugly mug on that page. But again man, thank you very much for the great words, dude. I appreciate it.

Yeah, you bet. Keep on changing the world. Chris, thanks for joining us on Freedom Fast Lane.

Thanks for having me, Ryan. Have a good one.

You might be familiar with my five habits that I practice on a daily basis in order to continue my success. I call it my tribe 5. You can find the episode by just searching Freedom Fast Lane Tribe 5. But one of the daily habits is to get my daily greens and oftentimes I use athletic greens for that. So I want to give these guys some love. Head over to athleticgreens.com Amazon buy them on Amazon. Get your B point for the day in your tribe 5. Hey, if you have a business that is doing well and you're doing at least $100,000 a month in sales and you want to grow it, I have recently exited one of my physical products brands and I have decided to work with a handful of new students to take them from $1 million to $10 million and up and help them get ready for sale. I think I'm going to really enjoy this and I have a pretty good success rate of helping people who are doing over $1 million grow into the multi millions. So if that sounds like you and you want the playbook for going from 1 to 10 and you want to hang out with people like the guys of Athletic Greens, Kevin and Jeremy who have been on the show as well as the rest of our back room, I'm encouraging you to apply for inclusion over@capitalism.com.

Backroom. All one word. You can fill out a short four question survey, it'll put it on our desk and if it looks like a fit, we'll hop on the phone and we'll see if it's worth us working together. If you don't see an ROI within 90 days, something went terribly wrong and most people will say that it pays for itself and then some within the very first conversation because we're able to find hidden profit. That has certainly been the case most of the time when working with somebody who's doing at least a million dollars in sales, and that's why we can quickly ramp up over the following 12 to 24 months. So that's@capitalism.com backroom. If you're doing at least a million dollars in physical product sales and you want to step on the gas or on the accelerator, if you drive a Tesla and you want to hang out with the folks at Athletic Greens, Kevin and Jeremy and the rest of our rock stars inside of the back room. Hey, I hope you enjoyed today's episode. And stay tuned. Now that I have exited some of my brands, I have some really cool, fun stuff cooking up for here on the podcast, so make sure you're subscribed over@freedomfastlane.com iTunes and I will see y' all on the next episode.

Sa.