The Cheese #54 🧀 - Extracted, Epstein, and Sam Darnold

The year is moving by quickly, cannot believe we are already in February!

Started the month and week off in a pretty cool way, officially launching our collaboration with Fox. The collaboration is with their TV Show Extracted and us. For the collab, we created custom limited edition BattlBoxes that will be getting sent out to creators, show staff members, contestants, and anyone who wins the giveaway, which you can check out here: https://www.instagram.com/p/DUTfuI6kW5b/

As we are looking at sales channels that we want to scale further; one I do not talk a lot about here is TikTok Shop. We had some moderate success on the channel last year, driving a little north of $500k in revenue. There were several iterations of the strategy, but we finally found that moderate success by sending our product out to creators who would make videos reviewing or discussing our products while tagging them, so viewers of their posts could purchase. For the better part of last year, TikTok treated creator organic content that tagged products VERY WELL. Better than our own organic content, even when our video might be superior in any and every lens. The reason was simple; they wanted to grow the creator economy on TikTok. We leaned in and saw the success. Recently, there has been a shift in the TikTok algorithm. The previously viral creator organic content tagging shop items stopped performing in the same manner. By design of course. TikTok’s solution? Put ad dollars behind the content. We are getting ready to run some ad tests on TikTok Shop, and it was WILD to see that in order for it to be profitable (on a product we have great margins on), we need to achieve a ROAS of greater than 3 just to NOT lose money. We have to have a ROAS greater than 7 just to hit our standard acceptable margins. Why? There is simply too many hands in the cookie jar on TikTok Shop. In order to have success on there, you have to discount the product, give free shipping, pay TikTok platform fees, pay the creator, obviously pay for the product, and now also give TikTok Ad Dollars. The end result is a near-impossible task of being profitable. My above example is also on a product that we have a 76.67% margin on. That is not sustainable. End Rant.

We finished January Whatnot at $228k. $49k short of our December record, but we absolutely took some learnings with us from the month (in addition to some scars). February is off to a slightly better start than January from a revenue perspective, but over 40% better on margin. In addition to the inventory (89 pallets i spoke about) we purchased that we are just about to start going through; we also are in talks to secure a great supply chain of products outside of the outdoor space that will give us the needed inventory to actually launch our secondary channel. More details soon.

Amazon continued the ‘slow and steady wins the race’ dominance. January was up 25% YoY.

Membership is going about well as possible. We hit our goal for January, and this month will be fun as we attempt to scale (this is the first month we can sell more with our increased Purchase Orders). Optimistic that our success on all channels will continue.

You will see a sponsored section below. We will continue to attempt monetization of this newsletter, not really to make money, just trying to cover the costs it takes to run. So click the links! It’s how we get paid.

As you read this, I am on site near Athens, GA doing a site visit for the likely location of BattlGames Season 3. Speaking of BattlGames, Season 2 Episode 4 dropped yesterday. This is the last episode before the finale next Thursday!

Let’s get into the rest!

One quick question: would you like to leave 20%, 25%, or 50% gratuity?

Tipping culture in the US is out of control. I said it. Everyone is thinking it. An experience from my vacation at the end of the year led to this piece. Enjoy.

Epstein Files G-Suite

Regardless of where you fall on the political spectrum, chances are you have followed some aspect of the Epstein File dumps. Well, I stumbled across this pretty cool tool. It’s taken all of the Epstein File dumps (including this weeks) and made them all searchable as if they are living in G Suite. The email is Gmail, you can pull up all texts, Epstein’s Amazon purchases are in a section, redacted files live in G Drive. Pretty cool GUI.

Sports Cards Going Up - Super Bowl Baby

Not a surprise to see both Super Bowl QBs in the top 5 list this week.

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Your Weekly Dose of Cheese is Now Complete! 🧀

If this week’s cheesy journey left you craving more, don’t keep it to yourself! Share the newsletter, and let your friends and colleagues dive into the cheesy goodness with you.

Keep it cheesy and see you next time!

Cheddar Cheers,
Team Online Queso