What a Profit Engineer Does Every Day at CTC

that we have within stateless,

“and that that the data team puts together.”

Number one is our spending power model. This essentially is the new customer revenue function of the forecast, essentially grading the spend in efficiency curve, saying like how much if you push this much in spend, this is like the efficiency

that we can expect to get just based off the historical data that we have. Then we also have our retention models, which look at our cohorts and how they mature over time, which gives us the returning customer revenue,

function of the forecast, and then finally we have our event effect model, which essentially ingest the marking calendar from the brand. And essentially the way that it works is we tag all the historical marking events, whether that be email, SMS,

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just go to axon.ai/ctc to set up your first campaign. - Well, jar profit engineer at CTC and best-herit CTC. Is there any other, the other accolades that you carry at CTC that we need to know about? - I guess those, yeah, those, those the first

I'm gonna hear that one. The best-herit. - Yeah. - Well, yeah, it's hard to, anybody that's watching the video form, it's hard to miss. It's a great head-of-hair.

Unfortunately, I'm in my mid 30s at this point and my hair is going the wrong way. But anyways, this is the podcast I'm hosting for some host, Randall Thompson. Here with jar, they profit engineer at CTC.

And today, we're gonna kind of try to demystify the profit engineer a little bit and kind of open up your brain a little bit. Go through that nice hair and get into that brain and try to get an idea of what your day-to-day looks like

“as a profit engineer and kind of what the secret sauce is.”

While you sit in that seat.

So first off, me and you were both central Florida native

so we got that connection down. And your background, you give us a little bit of just a little bit on your background so everybody kind of understands where you're coming from and where your knowledge comes from and where your experience comes from.

- Yeah, yeah, for sure. - Yeah, so this is like, from my past life as a peril owner. So I had my own a peril brand for about 60 years so that little stretch in period of time.

That's kind of how I came to know CTC in the overall direct to consumer space as a whole. I'm just falling along there. So I grew that so multiple 70 figures in revenue learned a lot of things along the way.

You know, it was a good learning experience. You know, I was the owner pretty much all the departments, you know, marketing. There were so many things like that. So really encompassing, you know, all aspects of business

when now is strictly focusing on, you know, the kind of paid media side of things, the digital enterprise of direct to consumer. But yeah, that's kind of what this all comes from, kind of that past life.

- Yeah, that's cool. So being a profit engineer, having the context of owning your own business and understanding the relationships between cogs and optics and how it relates to marketing.

Even though you don't necessarily put on the hat of ownership, but you still are owning the accounts that you're working with and having all that context from the past probably helps a whole bunch having to own your own business.

“- Yeah, however, say I think config matters a lot,”

especially, you know, when you're dealing with clients, you know, who are having an experience in like real problems in their business, outside of, you know, just marketing and finance function and being able to tie those pieces together

and have the experience and context is really helpful. - Yeah, that same with me, grew a business for eight or nine years, sold that business, oh, I'm on the agency side, and it's kind of interesting to see it from this side

and it kind of gives you a perspective that people otherwise would not have. So I can resonate with that. So talk me through, you know, to me, I've been at CTC for about five months

and I continue to just kind of like look into different corners

that a further I dig into, the more I learn. And to me, there's still kind of like this, this just mystic, like there's a profit engineer, but what does that actually mean? So to me, when you wake up in the morning,

I'm assuming you have some sort of accounts that are assigned to you that you oversee their growth or like, what are you actually overseeing? - Yeah, yeah, so I'm accountable for a couple of clients and a couple of accounts.

“I think the idea of a profit engineer is just to,”

you know, engineer profit for brands. So just, you know, being the growth partner for predictive one profitable growth at the end of the day, and you know, work with a handful of clients across many different categories and industries.

They like that. But yeah, just really being the partner in terms of bridging the gap between marketing and finance and really leading with that profit in mind first. - So you wake up and you know that there's some sort

of daily goal that needs to be hit from a contribution margin standpoint. So that's the high level. - Yeah, yeah, exactly. So within Stout List, there's like a hierarchy of metrics.

So it's visually presented in a way where the top metrics at the top of the dashboard

is like the most important.

So at the top we have contribution margin, and then we also have order revenue, we have orders, MBR, things of that nature.

“But really just making sure that we're aligned”

and then to your point on the daily targets, I think that's a unique aspect. For us to not only forecast, you know, the quarterly goals, monthly goals, but also on the daily levels.

And that granularity actually allows us to be on target more often than not, just because we have that feedback loop on hey, we need to push our pool at spin here. We need to know great some moments in the calendar to kind of bridge the gaps they were experiencing

in the forecast. So those daily expectations in the forecast is actually very, very, very helpful for us. - Yeah, so it seems as if that stat List is just a good thing to lean up against.

Not only from a profit engineer standpoint, but also a good place for there to be common ground between you and brand owners. For me, like when I own my business,

I'm such a dinosaur that like when I first started,

I would say like, "Hey, go out and give me a three "of return on that spin." And yeah, gone or those did is, and what I love about the whole idea of opening a stat List and they're being this daily goal of contribution margin

and then everything kind of laddering down from there, it just aligns, let's just say, I'm the brand owner and you're the profit engineer, it aligns us on a daily basis. And it doesn't allow too many days to get away from us.

So if we miss one day, we're gonna figure out a way the second day roll in or the third day roll and then bring everything back. So let me ask you this, for me, like when I'm staring into Q4 as a brand owner, I'm saying to myself,

okay, to optimize this, I want to, I wanna land at 35% of marketing to revenue for the quarters.

“Just because that's what I want the goal to be”

at the end of the quarter, it doesn't necessarily mean that's what I'm waking up tomorrow and I'm doing 35% of marketing to revenue tomorrow in order to hit that 30, well, let's just pretend it's October 1st tomorrow.

So when you get the plan that's handed over to you, is it laddered up, is it, is it like you know that target for that particular day that eventually feeds bigger plan or how does that actually play itself out? - Yeah, that's a good question.

So when it comes to forecasting, there's three primary models that we have within status and that the data team puts together. Number one is our spending power model. This essentially is the new customer revenue function

of the forecast, especially grading the spend in efficiency curve, saying like how much, if you push this much in spend, this is like the efficiency that we can expect to get, just based off the historical data that we have,

then we also have our retention models, which we look at our cohorts and how they mature over time, which gives us the returning customer revenue,

function of the forecast, and then finally we have

our event effect model, which essentially ingest the marketing calendar from the brand. And essentially the way that it works is we tag all the historical marketing events, whether that be email, SMS, promotions, product launches,

et cetera. And then whenever we tag those future looking events in the calendar, it has an expectation on those specific days, that we can have, they kind of like those three kind of ladder up

to that individual granular expectations that we have on a daily basis. - Okay, so I guess what you're saying is that there's going to be some sort of returning customer, there's going to be some sort of new customers.

some sort of events that drive returning and new is right.

- Yeah, yeah, exactly.

“Yeah, you pretty much summed it up there.”

The returning aspect is from the retention model that we have, the new customer revenue is from the, you know, the spending power model that we have. And then in terms of like the overall efficiencies and expectations within the month,

for those specific days, it all stems from, know, the emails, SMS, product launches, sales, promotions, things like that, that we are launching throughout the month. - Brands like Ridge, Ashley furniture, and Wayfair

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- Okay, and so it's the profit engineer or you, the person that's going in and running these models or is this something that's done by the data science team or the data team and they're, they're going and they're drumming up these models and they're saying,

hey, here's the optimal and jar go execute the inner, like what's your involvement in the creation of the plan and then the execution of the plan? - Yeah, yeah, it's a good question. As definitely an exercise, we have a great team of data

specialist in data, you know, engineers who put together

these models, first things, first it's just ingesting the data

and getting real clarity on everything and making sure that everything ingested directly in that, we have clarity and clarity there. And then from there, once we build off the models, it's essentially now we have the tools,

you know, to build out the forecast, minutes to profit engineers job to align with the team there on the client side, just see, you know, what actual goals we want to, you know, ladder up to, whether that's, you know, Max Revenue,

Max Lifetime, Cartribution margin, maybe we want to, you know, spend a certain amount within a specific month, you know, this is saving nuances there, but essentially, you know, getting the tool from the data team itself and then kind of,

art, but we're putting together a forecast, they stop, you know, alignment with the client.

Okay, so data in, data in kind of gives us some sort of baseline

of understanding of what might be possible, but it doesn't necessarily end there, it also, it also is a conversation in which,

“what is your goal, what is it that you're trying to accomplish?”

Yeah, and then that gets, that gets put into the equation, and the combination of those two things then gets delivered, to jar or somebody like jar, and it's your job then to know what the daily expectation is, in order to ladder up to whatever their goal is,

and every single day you go out and you execute, towards that thing. Yep, completely, 100%. Okay, it seems simple enough, if I'm sitting on the, then the brand seed, I'm going, okay, great,

this sounds amazing. The, the thing that I do know is that like, when I was working with an agency, when I was running my brand, it's like midnight, and it's like two, four, and I'm sweating, and I'm like, uh, like,

the past four days are, are spend to revenues, been like 45% when the target's 30%. I'm sure, like, you're, you're just kind of, you know, watching some Netflix at 10 at night, and all of a sudden, somebody slacks you and goes,

hey, jar, we're missing the target for the day, what's, what's going on? So I'm assuming that those things happen all the time, but I'm guessing just like, my son, the other day, had a fire drill.

I'm assuming that you have some sort of technique, or some sort of like, plan whenever things don't go to plan. Is that, is that fair? Okay, so, so if I'm on the, if I'm on the brand side, and I'm saying, hey, jar, what's going on, dude?

We've, we've missed like two days, three days, four days in a row, you're told me that like day-to-day, we're gonna, we're gonna crush this. Like, what are you checking? What, what levers are you pulling?

What dials are you turning on?

“What are, what is it that you're trying to figure out?”

Yeah, yeah, I think, you know, when a problem arises, number one is just diagnosing the issue. So stateless has a nice visual, like I said, like the hierarchy of metrics. So whether we're off in, you know,

contribution margin, whether we're off in, you know, overall volume, you can kind of bucket up like two problems, either in like volume, problem, or like an efficiency problem, and like the worst case is kind of like both, but just through that, looking at stateless,

you can see, you know, where you're off on the planet itself, because within stateless, they have, you know, the actual forecasted, numbers that we are supposed to hit versus the actuals. So we can see like the deltons and the percentages on a daily level, as well as like from, you know, weekly and monthly level as well.

you know, in the channel specifically, or outside of the channel,

“to kind of ladder up and kind of bridge those gaps.”

You know, whether that be, you know, the Justin Buds, with Justin Bids, within Mehta, with Justin Buds, watching new creatives have a lot of experience, you know, being scrappy as a founder myself, you know, watching different offers, marketing, marketing events,

emails, promotions, things like that. Anything to kind of bridge that gap that we're saying in the plan, and you know, that's very important that we have the daily expectations. So we can identify and quickly, you know, solve those gaps before,

you know, the month closes.

Okay, awesome. So I guess what I'm hearing you say is like, you're like flying a plane and then like, you got a bunch of like dials and stuff in front of you, and you're able to just kind of see like, oh, like, we're low on gas here. Let's put some gas in this bad boy to, to keep this going. Obviously it's a lot more technical than gas, but like, for example,

if you're missing a target on Google spend by 30% and then you're revenue and

“Google's down by 40% you kind of go, okay, what's going on here?”

And you know to go fix that particular part of the business. Yeah, exactly. Okay, cool. Yeah, it's, it's interesting because you, you know, you walk into a doctor,

and you say, hey, I'm sick and they don't just go, okay, here's a prescription.

They ask qualifying questions and they kind of get down to the root cause of like what's making you say. And so the kind of, the same thing could be applied here to a business of like, you can't just stare at top line numbers or you can't just stare at an ad, ad account and how much you're spending and just say, well, that's the problem. You got to get down to the root cause of what's actually going on and then go actually fix that thing.

Yep, well, interesting. Okay, so let's say theoretically you go, oh, there's, there's an issue here with the return customer. We got to, we got to figure out a way to kind of bring in more returning customers within this next week to make up for the ground that we missed in the past three days. Do you, do you go and execute like in the clubio account or is there a team that

“supports you to be able to execute with a clubio or, yeah, within the clubio account?”

Yeah, that's a great question. Usually teams in clients, they have their own note you know and ask them as functions within their team, but as has a profit engineers, just to provide that strategic guidance. And I think that unique perspective that we have as well, is we have a collective of knowledge. If meaning that we essentially have, you know, this collective of knowledge where we have case studies of, you know, things that have worked in

the past and things that have worked in the past, we can kind of pass that on, you know, as a strategic recommendation, you know, as kind of like a remedy towards, you know, this unique situation. But even outside of, you know, the email and SMS programs, there's things that we can do, you know, promotion or sales wise on the site, you know, just launching a different offers to kind of bridge that gap, or even just spending more than some retention audiences

on Reddit. So, but yeah, those are kind of like the few things that we like to go through, just off the top of my head. Yeah, is ideation of offers? Is this, is this something a profit engineers do? You guys aren't just pressing buttons in the out of count. You're not just launching ads. You're not just monitoring the metrics. You're not diagnosing where the issue lies. You're also saying, well, it could be interesting that if you offered an upsell here or if you

buggled this together or if you price position to this, what you guys are also doing stuff like that. Yeah, yeah, definitely when it comes to like paid media performance in general, there's really only a few big like levers that actually impact performance. Just put it simply like creative obviously, you know, everyone understands the idea of having, you know, that creative volume and that diversity within the ad account. Number two, being, you know, the offers, this is essentially like the

need to move over within the account because once someone actually finds out that they like their product or your product that you're offering and all is essentially comes down to, you know, the value exchange there and really like if they're getting, you know, at an optimal price point or optimal offer, three being like landing pages and CR-Rones, so how are you, you know, optimizing your pages in your website for overall conversion rates. And then the last thing

just being like marking moments that you can align yourself to. And those really like those more like levers and rocks really make the biggest impact when you actually want to move the needle in terms of, you know, your overall paid media performance. Okay, so you take this four levers, obviously you're leaning into your, into your past, where you ran your own burn. Obviously you have your own strategic mind, you know, you're like,

like, I got, you know, I got this idea for this or this, this could fit like this, but you're also saying that there's just institutional and also just people, we have a team of people that have very similar problems all over the place. So I'm assuming that

but I'm sure you're part of one. Yeah. If you go, hey guys, I'm running into this or here's this,

well, what do you guys done in the past? Yeah, yeah, exactly. Yeah, I think, yeah, like I was saying earlier is that the unique idea here is that we have a collective of information. And when we write into like any problems or situations, you know, we have, you know, dedicated Slack channels, you know, you even have weekly standups that you know, we just walk through sort of like the challenges that we're all experiencing and just all bouncing all, you know, all of our ideas and knowledge

to solve in those problems, and even just like the idea of case studies, you know, that people have done in the past, you know, to kind of bridge those gaps, you know, whether that's like different offers that have worked in the past or different, you know, promotions or sales that have worked best versus brands or categories and know there's all this information and a collective of knowledge

that we can fool from. Yeah, I, when I first started working with CTC, I got pulled into,

“I don't know if that's the best way to put in it, but I got, I joined in on some live stateless”

jams. I don't know if you've been part of a live sales gym. Yeah, but the, what happens with a live stateless gym is there's something specific that a profit engineer is trying to solve for a particular brand and a bunch of different people just kind of show up on this call. Everybody pulls up stateless. There's like 10 or 15 minutes of silence to kind of just really analyze what's going on and then all these people kind of just jump in and feast on the, the stateless like a, like a bunch

of hyenas. But the first one I was part of Taylor was present and I was just like, everybody's just ripping right now. I thought I knew stuff, but I was like, yeah, maybe I don't, after watching

it, I was like, I don't know if I really know anything. Yeah, so that's a, that's a, that's a pretty

cool thing. Something, something I pitched here for, for context, we do a live live stateless gym. I think it would be a really good thing that people would want to part of. Yeah, it's good. Yeah, let's do it. I'll, I'll just sit in the background and just watch everybody flex their muscles. Okay, so cool. So you open up stateless. You see, you're behind. Well, let's take the opposite stance of it. You open up stateless and you get, okay, we're crushing it. We're hitting the goal.

Are you still looking for opportunities to grow the revenue to grow the contribution margin to, like, what, what is a scenario look like where, like, I'm so used to, I put on my hat in the morning, I wake up, I'm running a business, I put on my, everything's going to suck. Yeah, and I'm going to have to, like, say, hey, what is this suck? But there might be a scenario of circumstances that jar wakes up and he's crushing it for, like, too much straight. Are you actively bringing

new stuff to, to brand saying, hey, this might help you grow your revenue, this might help you grow your contribution margin, this might help you open up subscriptions, this might help you get more new customers. You might want to think about that, diversify and into, and to this traffic source,

“like, are you bringing new things as well, whenever things are going correct?”

Yeah, yeah, a hundred percent. Yeah, that's a great question. Typically, we start with, like, our base, you know, plan-based forecasts, and then we also have, like, our stretch goals. But I do, you know, if you can push overall ads, been in, you continue to crush. That's the wall there. Obviously, there's some, like, real-world business implications there. You know, whether you have enough, you know, cash flow, you know, sort of that ad spend, as well as, like, the inventory.

So, kind of, like, balancing those as well, not being in that silo, just, you know, increasing overall spend. But yeah, that's the ideal situation to have. And obviously, we, we, you know, cover, say, with our clients on that. But yeah, there's, continue, like, a value add there, in terms of trying to keep, you know, growing up into the right. Yeah, I remember in 2020, completely under forecasted what my inventory should have been.

“And if I, if I would have had my stretch goal, so what I, I think what I'm hearing you say is essentially”

you get the plan, but then you also have a plan that says, like, if things start crushing, this is actually possible. Let's, let's go for this. Is that, is that what the stretch goal is? That's something that's provided to you through the modeling or what is, what is it actually? Yeah, yeah, so we have, like, the baseline expectation is from the models. But the models are just a model of the past, right? So, if you can actually improve your spending power and

and beat the models and be how historically you've been, in terms of, like, efficiency and overall spending power, whether that's if you unlock a new offer, you, you know, unlock a new channel, or, you know, if you have better creatives in, in creative volume, you know, this is all things that can beat the model and unlock more stale than you initially forecasted, right? So, that's kind of where, like, the idea of the stretch playing comes into play, where you can actually, you know,

beat the baseline expectation that you came into the, and this one modeling with. Yeah, and you might, you might just be handcuffed by no inventory. There might be, say, hey,

ad's been going out and, and you're realizing cash, just keep putting, keep putting the,

“that ad's been on, on the AMX and just living like a big boy with his points. That's, I guess that sounded,”

but, but supposedly supposedly meta took away the ability to pay with a credit card recently for, for, like, his back out, so you're not getting the points now, which is, which is criminal. You know, that's, that's, that's part of the topic. All right, jar, listen to me on, on this one. You were a brand, you were a brand owner. You now sit in the seat on what you're helping other people realize profit on the brand owner side.

Yep. If you were sitting on the other side still, let's just say you were on the brand owner side, and CTC approached you, and you're like, uh, what hesitations would you have? Because obviously, you've, you've most likely lived it on the, uh, hiring agency side. Yeah. What hesitations would you have, or what, what hesitations did you have, and what does CTC do that those other, you know, the quote unquote bad agencies? What do they not do? And I don't want to turn this too

much into a pitch, but yeah, I just kind of, obviously, you've sat on both sides. So I know the ugly on one side, and you know the ugly on, on, on that side. What does CTC do at a World Cup class level? Yeah. I guess from like a brand owner perspective, when I was like looking for agencies, you know, to to help grow my brand. I guess, you know, everyone likes to throw out numbers, and everyone likes to throw out, you know, what they could do for your brand specifically,

but to actually, you know, execute on that actual, you know, plan in the, I guess ideal state

“that they promise you. That's, you know, that's where the, the, the gap lies, and I think, you know, with CTC,”

just with the available, like team in modeling and just overall infrastructure, that the forecast in versus like the actuals, like the plans versus the actuals is very tight. I think there's like a stat that, you know, we're within 3% of overall forecast off, like,

a couple billion dollars in GMV. So that's something that we take pride in over here, and, you know,

just from my, you know, retro-spective, you know, looking back as a brand owner, that was like the biggest barrier for me, just hiring like different agencies as they all promise the same thing. Yeah. What, when I, like the first week of starting here at CTC Taylor said, hey, it's this into your memory, and it's $3 billion of GMV, 3% of target, 40% plus in contribution, margin growth, and 30 plus percent in revenue growth, and that was in 2025 from CTC. And I,

and I'm going to agree with you that knowing, knowing what to do, having the models to kind of set everything up, wake up and actually have a plan in front of you of what you're executing against,

“and then the people that are in place to actually do that, like, jar, I think is what makes CTC”

different than the rest, and I don't want to turn this into into a pitch, I guess that's my pitch.

So, jar, thank you. I'm never hosted a podcast before, first, first time here, I feel like we did a good

job. It was a great, yeah. I don't really know, like the proper way to sign this off, but first off, jar, thank you for the top. And second off, I'm hoping that a couple more podcasts this month, we can get you on and just keep giving it. If you guys say hello, I don't know, keep giving it a hell of joy. Physician, I hope you got that.