Scaling Smarter With AI and Direct Mail With Ernest Tavares III

Intro: 00:00

Welcome back to the Response Drivers podcast, where we feature top marketing minds and dig in to their inspiring stories. Learn how these leaders think and find big ideas to push your results and sales to the next level. Now let’s get started.

Rick Rappe: 00:19  

Hey, I’m Rick Rappe, host of the Response Drivers podcast. Here we dive deep with marketing experts and innovators to learn how they approach targeted marketing and use data driven strategies to acquire and retain customers. We’ll talk about what’s working, what’s changing, and how we can stay ahead in an evolving marketing landscape. Response Drivers is brought to you by RPM Direct Marketing. RPM helps companies develop hard hitting, direct mail creative and utilize advanced testing and targeting methodologies to reach customers and prospects.

Our goal is to fully optimize your marketing performance to drive more sales and exceed growth expectations. RPM delivers smarter, more profitable direct mail solutions so you can turn your direct mail programs into a predictable, efficient sales channel. Check out rpmdm.com to learn more. I am excited to catch up with my guest today. 

Ernest Tavares III is a growth marketing expert and Founder of First Step Growth, a performance focused agency helping startups scale through paid media analytics and go to market strategy. With over a decade of experience, he’s personally deployed $200 million across a diverse set of advertising mediums, from TikTok ads to national television commercials and everything in between. Ernest and I met working together on one of our clients, Connie Health. In fact, Ernest specializes in driving efficient customer acquisition for healthcare, AI, and consumer brands. Thanks for joining us today, Ernest.

Ernest Tavares III: 01:51  

Thanks for having me.

Rick Rappe: 01:53  

So in my research, I found out that you grew up in Waimea, Hawaii, and you were one of the first or the first in your family to earn a college degree from Wharton, and that’s quite a journey. Can you tell me a little bit more about your career journey and how you ended up as a marketing expert?

Ernest Tavares III: 02:11  

Yeah. So, I mean, if we’re going back to high school, I had like a deep desire to kind of leave Hawaii, which is a hard thing to do. A lot of my peers typically don’t. So I wanted to, you know, push myself to kind of see something new and kind of, you know, change the environment a bit. So when college applications times came through, I immediately tried to apply to schools as far as possible from home.

And I obviously got accepted to Wharton. I was actually accepted on a full ride scholarship, so that made the decision quite, quite easy for me. And while at Wharton, a lot of my peers. They favored kind of finance and accounting. So a lot of these folks, you know, knew that they wanted to be investment bankers before they even got there. 

And so I felt a lot of pressure to kind of go towards the finance or accounting route. But I just found those classes very dry and just lacking a lot of creativity. So when it became time to pick a major, I chose marketing because it felt like the one that was going to be least restrictive in terms of how creative I could be.

Rick Rappe: 03:30  

It seems like it fits your personality perfectly.

Ernest Tavares III: 03:33  

Yeah, I think so.

Rick Rappe: 03:35  

I found in my research that you joined a series, a startup called Mochi Health and dramatically scaled the sales pipeline. Can you talk a little bit about that experience, and what were the key factors that enabled you to achieve the rapid growth?

Ernest Tavares III: 03:50  

Yeah. So Mochi Health was in the GLP1 space, so the space itself was very hot. It was just a very popular product that they were offering us. However, growth marketing was absolutely critical in getting them from a close. From ten mil to roughly 100 mil in are the channels that we used were pretty?

I’d say cutting edge mix of really kind of modern marketing. So influencer marketing was absolutely critical. We also leveraged meta ads and Google ads very heavily in order to scale again from their ten mil base to upwards of 100 million. And we did so in roughly six months. So that was probably some of the most aggressive growth marketing work that I’ve done.

Rick Rappe: 04:39  

Wow. And that was one of your sort of first experiences in the startup startup marketing world?

Ernest Tavares III: 04:45  

Yeah, it was. So I kind of came from a larger enterprise brands, but I realized that Things weren’t moving quickly enough for me there, so I decided to work, for I was the head of growth for three direct to consumer startups over the last five years, and each one of those startups were in what I consider white hot industries. So GLP1 or I. But what I’ve quickly found is if you kind of have a good playbook for growth, you can swap out the industry and a lot of those tactics will scale and will work. They’re very industry agnostic.

Rick Rappe: 05:24  

Wow. That’s quite a bit of experience in a short amount of time. What inspired you to establish First Step Growth and how does your agency differentiate itself in the crowded marketing landscape?

Ernest Tavares III: 05:40  

Yeah, so we’re really small. It’s basically just three people. I’m primarily the client-facing side of the house, and most people just do work directly with me. I just started to start First Step Growth because again, I realized that a lot of these tactics that I was applying to numerous healthcare startups and startups in general generally were working, and I felt that I could have a larger impact and work with more clients and grow more businesses simultaneously by working as an agency owner as opposed to kind of being in-house. So it was kind of a desire for me to once again just test my skills and kind of test the playbook that I have.

But across more clients, I tried to build the growth agency that I kind of wish that I had as a head of growth for multiple startups.

Rick Rappe: 06:32  

Yeah, that sounds really similar to how we started RPM. Gosh, 17 years ago now. I had a lot of experience as a direct marketing expert working on big brands, and I wanted to take that expertise and all the knowledge that I had out of running their big programs and make it accessible to a lot of other companies as well. So it’s a great way to start in the business. And congratulations on starting your business. Now you’re an entrepreneur.

Ernest Tavares III: 07:03  

Yeah. Thank you. And I’m six months in so I’m relatively fresh. But I’m excited to continue this journey.

Rick Rappe: 07:10  

That’s awesome. How do you leverage data and analytics to inform your marketing strategies and help drive your customers’ programs? Can you talk a little bit about that?

Ernest Tavares III: 07:23  

Yeah, I think data-driven marketing is, you know, kind of a given these days if, you know, you aren’t using data or even AI at this point in kind of your marketing workflows, you’re probably going to get left behind. And so my agency and kind of the philosophy that I’ve developed through kind of spending, deploying over $200 million on Facebook and Google is to really focus on the platform’s ability to find users. I think a really traditional marketing marketer might consider extreme segmentation to be a productive strategy, trying to segment an audience and match the message perfectly. But in the age of AI and kind of digital marketing, I help just feed signals to the platforms using things like conversion feeds and customer matches, match lists, excuse me, to essentially allow platforms like Meta and Google to do what they do best, which is, again, convert users. So I don’t focus as much on segmentation or audience targeting as you might expect.

Instead, I kind of just focus on feeding effective signals to these platforms.

Rick Rappe: 08:34  

Interesting. That’s very interesting. In an era dominated by digital marketing, how do you perceive the role of direct mail in a comprehensive marketing strategy.

Ernest Tavares III: 08:50  

I love direct mail. I think that it’s often kind of forgotten about, or thought of a bit too late, and a lot of kind of marketing strategies. You know, it’s really simple to get a Google Ads account or like a meta account up and running in an afternoon, but you’re competing with everyone else who’s able to do that in an afternoon as well. So I think direct mail holds a special place in my heart because it’s a it’s a physical ad, which I think are extremely powerful, and it really allows your brand to stick out in a sea of digital ads and so effectively sprinkling in some direct mail alongside digital, it usually creates a situation where, you know, a one plus one is greater than two. You can allow both the digital and more traditional offline channels to kind of synergize and hopefully create more effective customer acquisition strategy.

Rick Rappe: 09:45  

Yeah, that sounds great. Do you know, have you found success integrating the traditional marketing channels like direct mail with digital? Have you seen any examples of where those things have kind of come together?

Ernest Tavares III: 10:01  

Yeah. So I think one thing that I really enjoy leveraging direct mail for is retargeting. So it’s fairly cheap to, you know, get impressions and drive website traffic to, you know, a website. But then it’s kind of like sending tasteful direct mail. It can be automated using platforms or it could be, you know, more manual, but essentially pairing that digital retargeting strategy as well as kind of an offline retargeting strategy to kind of get to users who just might not respond to digital ads.

And in certain segments, like the segment that we worked in together in Medicare, I think direct mail is actually better than doing digital ads.

Rick Rappe: 10:46  

Yeah, we were targeting the Medicare audience, so there were definitely older and less involved in a lot of these digital channels. So direct mail was a natural fit in that regard. Surprisingly, there’s a lot of research on the younger audiences being really favorable to direct mail as well. It’s kind of interesting. We think of it as something that only old, old folks would like, but a lot of younger people don’t get much mail, so they are intrigued by it when they do get it.

Ernest Tavares III: 11:16  

Exactly. I think, you know, like anyone younger than me, you know, grew up with a smartphone. And so they’re like almost numb to some of the digital ads because they’ve seen those, you know, their whole lives. They’ve interacted, you know, they grew up with Instagram and TikTok. And so kind of having like a really a really well designed, really clean direct mail offering will probably stick out a bit more compared to just another digital ad impression that they’re getting.

Rick Rappe: 11:44  

Yeah. Well, you mentioned something a little bit earlier about AI, and I’m not familiar with that term. I’m just kidding. Everyone is talking about AI nonstop of course. So I have to ask you sort of how do you see AI and machine learning shaping the future of marketing and how are you using it?

Ernest Tavares III: 12:05  

Yeah, so I’ve been able to kind of scale my ability to produce especially written content. But visual is definitely coming pretty aggressively. This is part of the reason why I’m able to keep my agency size so small. I’ve found a ton of really useful tools. One of the ones that I really like is called Jasper AI, and that’s a tool where essentially you can feed and train the AI model on specific branded content that you’ve already written, and then all the content that it spits out after that will actually be in the tone and kind of the voice and speak to your target demo.

So being able to spend, you know, an hour in Jasper will allow me to basically create an SEO strategy, an SEO content that would probably take a copywriter a week to manually pick out. Now, we do like to edit things and kind of give it more of a human touch to ensure you know that there’s still a person in the loop. But I think examples like this are just going to increase and grow even further. I’m starting to experiment with using AI for stock photo images for ads and tools like Midjourney have come a really, really long way in the past couple of years. I do feel like doing a video. 

AI ads will be fairly simple and fairly straightforward in the next year or so.

Rick Rappe: 13:28  

Yeah. That’s interesting. I wanted to ask you about search marketing because you just mentioned search marketing as well, and I noticed I feel like I must be impacting search marketing pretty severely because when I search for anything these days, I go to Google and it just gives me the I answer instead of giving me a bunch of links to click. So like a lot of times I ask a question or want to, you know, want to research something or I’ll use my phone and, you know, go to Gemini or go to copilot or ChatGPT or whatever. And I say, create a vacation plan for me.

You know, I want to go to Italy for a week and boom, it does it. And all of a sudden I’m not going, I’m not going to anybody’s website, you know? So how does that impact search marketing?

Ernest Tavares III: 14:14  

Yeah, I think SEO is definitely had to kind of come up with a quick and new playbook because essentially, you know, it’s been probably about 20 years since like, you know, blogs and like just creating like aggressive amounts of, like branded SEO content. That’s kind of been the way that it has for a long time, and so I feel like I have probably disrupted folks in search marketing a bit more than performance. I think now folks are starting to figure out, instead of how do I get my page to rank highest in Google? The kind of the goal now becomes, how can I get my company’s website or something to show up in one of these large language models responses. So I’m not super.

I’m not an SEO expert, but I could definitely imagine that some of these folks are. Yeah, really having to rewrite their existing playbooks.

Rick Rappe: 15:14  

Well, I guess that just shifts the priority probably to paid advertising instead of the organic search.

Ernest Tavares III: 15:21  

Yeah. And kind of what I’m sort of waiting for is what paid advertising will look like for some of these companies, like ChatGPT. They haven’t, you know, figured out a way to start monetizing through ads yet. But when they do, I think companies like Google and Meta, which have had, you know, a significant hold on digital marketing, will probably start to lessen their hold and have to come up with creative ways to compete with some of these new AI companies.

Rick Rappe: 15:50  

That’s interesting. So they’ll become, even though they’re not advertising platforms yet, they are going to become advertising platforms soon.

Ernest Tavares III: 15:58  

That’s — it’s only a matter of time.

Rick Rappe: 16:01  

It’s kind of sad. It’s kind of like everything’s great until they monetize it and then it’s like, yeah.

Ernest Tavares III: 16:07  

Until they figure out that their investors need to make some money back.

Rick Rappe: 16:10  

Yeah. Well. Well, marketing is evolving so rapidly. How do you stay ahead of trends and ensure that you’re using the most recent, most modern tools and tactics?

Ernest Tavares III: 16:25  

Yeah. So I really do enjoy subscribing to platform blogs. You know, I think kind of just hearing it from the platforms themselves. Hearing the updates first is a great source of kind of fresh ideas and kind of staying ahead and knowing what’s in the pipeline, but other tools like I love listening to business podcasts. There are a few like response drivers that I do enjoy, but I’d say newsletters and podcasts in general are pretty helpful as an additional way to keep up to date.

Rick Rappe: 17:01  

Do any other great podcasts come to mind that you would think of that are good for marketing topics?

Ernest Tavares III: 17:09  

None that are strictly marketing focused. I do listen to a few podcasts that are a little more like startup kind of business growth focused.

Rick Rappe: 17:17  

One of my favorites right now. I’ll give it a shout out. Diary of a CEO. I love that podcast. They have a lot of great guests on that show.

I’m trying to learn from watching every episode of that podcast, so maybe someday I’ll be as good as they are. Gotta have a gotta have a goal, right? Can you mind sharing or talking about a significant challenge that you’ve faced as a in a marketing campaign, and maybe how you overcame it? Does anything come to mind? We did some pretty hard things at Connie Health. 

Maybe there’s something there that we could talk about.

Ernest Tavares III: 17:53  

In general, working in highly regulated industries such as finance and especially healthcare, I think a barrier to overcome is doing marketing and doing performance marketing. Compliantly with the advent of AI, you have a lot of AI systems that are now just automatically checking things on Meta and Google and disapproving them because, you know, they, the AI platform thinks that what you’re writing is non-compliant or in a way is breaking some guidelines. And I’ve actually, in the past year, seen this especially happen a lot on meta, where things will get flagged and companies will actually be penalized for breaking guidelines, but they actually are compliant. And so for that reason, I’ve actually — I’m a Facebook marketer that’s usually been kind of my bread and butter channel. But because the compliance has gotten fairly automated and it can oftentimes be wrong, I’ve actually started to diversify my channel mix into other digital channels.

Shout out to like Reddit ads, love Reddit ads, and I’ve seen a lot of good kind of performance come out of there. So kind of just understanding how to use the platforms compliantly but and without sort of, you know, putting any businesses at risk.

Rick Rappe: 19:13  

What advice would you give to individuals who are aspiring to enter the field of growth marketing? Young people in college are just graduating from college. What advice would you give them?

Ernest Tavares III: 19:26  

Yeah. So growth marketing is such an umbrella term, you know. There’s so many aspects of what you could do, and there’s so many skill sets that, you know, fall into this category. You could be an amazing writer. You could just be really sharp with spreadsheets.

You could just, you know, be a really solid video or content creator. So I think that it’s almost like the paradox of choice, right? There’s so many things that you could do to become an effective marketer. And I think the advice that I would give is pick one skill and then really master it. For me, that was paid marketing. 

It spoke to me. I liked handling money. I’m not the most gifted, long form writer, and I really liked how it was kind of almost like optimizing a stock portfolio, if you will. But basically I chose to kind of focus on paid for, like the first five years of my career. And then after that I had a skill set that I could then kind of apply and drive success for businesses of all sizes and all types. 

So while it is like very, it’s hard to not want to boil the ocean and learn everything all at once. I would say try to master like 1 or 2 skills that you feel that you can create a strong foundation and then grow other skills on top of that. I picked up SEO because, you know, people needed somebody to write effective blogs. And they, you know, I was the one man marketing department. But because I had paid and I was able to like scale that and have a solid foundation there, I could take more risks on SEO. 

You know, it didn’t need to produce as much volume immediately, because I had a few things that I was more comfortable with.

Rick Rappe: 21:08  

Well, once you have that foundation built, then you can add on to it with more experiments and especially in the startup world. And I know your mentality is your mentality, sort of like try things, fail fast and learn and then evolve. I mean, that’s kind of the standard startup playbook. Don’t put too much money into anything initially, and obviously everything’s a test.

Ernest Tavares III: 21:34  

Yeah, I think of growth marketing, especially when I like first sign on a client or like I’m getting just onboarded into a new role. It’s kind of akin to like spinning as many plates as possible. But then you’ll start to realize and pattern match and you’ll start to realize, hey, like one plate might be spinning more effectively or more quicker in a better direction than the other. And so being really quick to drop the other plates and kind of diversify away from them, I think just kind of being pretty savvy at data analysis really helps you to understand, you know, what’s the business impact?

Rick Rappe: 22:11  

What are some of the key metrics that you focus in on when you’re doing that? Sort of looking at the channel mix and what are some of the decision making metrics?

Ernest Tavares III: 22:21  

Yeah. So I again, we’re like in an ad management UI, you have so many metrics, you have clicks, impressions, click through rate. It’s almost too much for a human brain to fully comprehend. So I kind of forced myself to put the blinders on and just focus on ROI. You know, usually there will be other metrics that will help you understand the differences in ROI.

But in my opinion, when it comes especially to performance marketing, focusing on something like just like CAC really leaves some of the other revenue side and how profitable things might be out of the picture. So I think just focusing on ROI, using a couple other metrics, like CAC tends to be most effective because.

Rick Rappe: 23:07  

It stands for cost per acquired customer. Correct?

Ernest Tavares III: 23:10  

Correct. Yes.

Rick Rappe: 23:10  

Yeah, yeah. I just want to make sure that I explain that for anybody that doesn’t know what it is. Yeah, that makes a lot of sense I love it. I mean I was like cost per acquisition or cost per sale or cost per for the customer because it includes the cost of the marketing and also the results. And then ROI also includes the third component, right, which is more like, well, now what did I sell is and what, you know, what’s the lifetime value of that sale or the longer term value of that sale, so that I can really figure out, like for every dollar that I spent, how much of a return am I getting on that dollar?

Ernest Tavares III: 23:46  

So exactly. And I think it’s almost a crime. How many marketers don’t get to that point where they’re not looking at, you know, kind of the different revenue outcomes of some of their activities?

Rick Rappe: 23:58  

That’s very true. That’s very true. We work with some clients that are very focused on response rate, and we have to remind them regularly that, well, let’s also look at the cost, because, you know, you’re spending different amounts of money on different tactics. And the number of sales is a function of how much you’re spending. And we need to figure out the return on that investment.

So it’s really important for sure. And I think it’s really helpful when the whole team understands what is the key metric that we’re going to focus in on and have the blinders on, like you said, so that they’re everybody’s clear on how what is the decision making tool here? What is the touchstone for truth?

Ernest Tavares III: 24:44  

And I think it can be hard with marketing because marketing is actually a pretty inherently emotional thing. You know, there is a lot of emotion that comes into ad copy and comes into, you know, the different imagery that you choose for things like direct mailers. So you could sit there all day, you know, kind of arguing more of them, more emotional aspects of it. But when push comes to shove, you know, kind of using data to help guide that conversation will usually help the meeting end a little quicker, if you will.

Rick Rappe: 25:19  

Yeah, yeah I know. In direct mail, it’s tricky because we. Well, we run into it all the time where people, our clients or someone reviewing the creative will have a strong opinion about it. And it’s like, I would never respond to that. Well, you’re one person and we’re talking to a whole bunch of people.

So we still got to test it and find out if it’s going to work or not. You know, you might be — opinions are interesting, but they’re not really that useful. And yeah. Are there any books or resources that have profoundly influenced your approach to marketing or leadership?

Ernest Tavares III: 25:56  

Yeah. I think in general, kind of just taking a step back, like how to build a startup or how to build, you know, a company that’s trying to push, you know, the brink of what’s possible. One of my favorites that I read in college, that I actually try to reread every couple of years, is a Zero to One by Peter Thiel. That book again, I don’t think it was sort of. I don’t think it got enough recognition for what it was. So I really appreciate that one for just kind of like how to build a company that really wants to, you know, go from nothing and kind of provide value to society.

And then two of my other favorite books are The Lean Startup and I think and also Lean Analytics. And I was laughing because they’re both lean, which I guess speaks to how I like to run my business as well. But essentially I like these books because, you know, I think there’s so many resources out there, there’s so many things available, but you don’t need that much to get started. It doesn’t take that much to test an idea. So yeah, those are a couple of my favorites.

Rick Rappe: 27:03  

That’s awesome. Well, I’ll throw you one more that you can check out. I recently recorded an episode with a guest, Andrew Miller, and he wrote the book called The Startup Growth Book. So you can check that one out. I think it’s very good for somebody who’s working on startups.

Yeah, I’ll check it a lot. Thank you so much for your time today, Ernest. I really appreciate you being a guest on the podcast. How can our listeners connect with you or learn more about First Step Growth’s services?

Ernest Tavares III: 27:34  

Yeah, easiest way is to just connect with me on LinkedIn. But otherwise you can check out our website at firststepgrowth.com.

Rick Rappe: 27:43  

Awesome. Well, thank you so much again and have a great afternoon and we’ll talk to you again soon.

Ernest Tavares III: 27:48  

Thanks, Rick.

Outro: 27:50  

That’s a wrap for this episode of Response Drivers. Thanks for tuning in. If you found today’s insights valuable, make sure to subscribe so you never miss an episode. And if you’re enjoying the show, we’d love it if you left a review. Got a question or a topic you’d like us to cover?

Just drop us a message at responsedrivers@rpmdm.com. Until next time, keep driving response and making your marketing work smarter.