I’m trying out a new essay and email format. I took inspiration from these 2 newsletters: Tommy Clarke’s The Social Files and Scott Galloway’s No Mercy / No Malice.

What I like Tommy, is he’ll do light personal update about his business and life and tie it back to the topic of the day. It reads so much more human. Scott Galloway does this seamlessly throughout his writing with anecdotes, jokes and references—seems like a skill set with over decades of writing experience.

He’ll also segment the email with different headers to partition out different points more. I’ve adapted this because it forces me to be more thoughtful of delivering and editing the content so it’s more approachable to you as a reader instead of a long block of text.

I found these two features refreshing because I’m tired of heavy LLM copywriting. “It’s not x, it’s y”. So to combat that I must be part of the solution.

I mocked up a quick and dirty v1 banner and signing off with a signature too. Because of brand (duh).

I’m reading the book “The Digital River of Genes” by Richard Dawkins, a respected figure in evolutionary biology.

I made the connection that this is relevant to Facebook Ads in terms of how to balance the nuance of branded assets and performance assets.

Because the prevailing norm is performance marketers will poo-poo brand while brand marketers can be too strict. Then what’s the solution? Well, let me tell you.

How to think about Branded Ads versus Direct Response Meta Ads with Peacocks

Meta ads for DTC brands is like the evolutionary adaptation of a Peacock.

Stay with me on this, it’ll be interesting with 2 practical takeaways.

Richard Dawkins will talk about how a male peacock will have colorful feathers to impress future peacock wifey.

Just like the impressive 7 day click ROAS on a hyper-gimmicky direct response ad.

But, it’s also high risk for that specific peacock since predators see it easier.

The same way, a gimmicky Facebook ad has risk for of not having lasting brand impressions at best or diluting brand equity at worst. Even if it’s performing better than other ads in the short term.

But when zoomed out, the pool of genes of peacocks as a species will more likely survive since reproduction is happening.

If the business is not profitable and just relies on branded vibe aesthetic ads, which has its place in time, the business will go bankrupt.

The Integration Performance and Brand for DTC

So it’s less about being unwavering in your position of “brand doesn’t matter” and “the branding looks off” but the integration of both of them. The exact nuance and mix of that is more art than science but I can tell you it’s not 100% direct response ads and 100% branded vibe ads.

The answer lies in an allocation between the both of them and that will fall on your business goals, unique advantages, and risk to reward appetite.

You might be able to survive in 2026 DTC in the short term but to be meaningfully be beyond the average growth rate of the industry takes making these decisions which are inherently risky.

The analogy here is you don't want to have your female peacocks ads having colorful feathers too or else the entire ad account species dies.

Increasing your surface area of width and depth in what we call a Creative Portfolio , with a different mix of ads ensures in the short run your Meta ad account species’ survival. While also considering its long term longevity.

Action:

• (1) Diversify your ads in what we call the Creative Portfolio. Our Creative Portfolio construction is called SPAMS (What you’re Selling, Persona, Angle, Media Type and Media Format, and Style of Creative)

• (2) Look at your ads the past 30-90 days and view your ads from a 28 day attribution window. Are there any ads that are within your benchmark in-platform target that might not be as impressive on a 7-day click basis but on a 28 day attribution window is.

  • Discernment, taste and intuition lends itself here where you ask “Would this ad be beneficial to brand impression?” beyond Facebooks limited 28 day window. Think of it as a 90-365 day ROAS.

  • If you don’t feel the energy from the ad, then probably not. If it sparks an emotion in you, there’s probably something there.

Let me know if you plan on implementing, I get these email responses directly to my business email.

DTC Growth Resources:

• Visit our DTC Library: A sequential resource built for $5M-$30M DTC Brands.

• Read the rest of Commerce Outlier essays on DTC Growth.

• If you’re a $5M-$30M DTC Brand, explore working with our lean growth team at our boutique agency, Emblem.

Cheers to adventure,

Meta’s Andromeda algo doesn’t explicitly give a recommendation # of ads in a CBO ad set like they used to.

BUT Facebook's been hammering Creative Diversity across their decks/presentations/website.

This hints at the structure of leading with net-distinct concepts. While leaning into machine learning and maxing out variants with their system through flexible ads + advantage creative+.

For Flexible Ads, if the concepts are all distinct from eachother, e.g. 10 unique video concepts in one Flexible ad, then just having 1 ad is fine.

If the 10 videos/statics are variants, then I'd recommend waiting to load up a minimum of 2 flexible ads for diversity in an ad set. And depending on your creative production speed, capping out at ~5 maximum loaded at any one time because waiting any longer for more than 5 sets of flexible ads would mean a slower frequency of testing.

For Non-Flexible Ads, 5-12 ads in an ad set isn’t unreasonable. The OG guideline pre-Andromeda was 5-6 ads in an adset, but because that models changed, more lends best to their algo now.

Important, Andromeda will actually shortlist ads before serving them.

From the engineers: "We narrow down a pool of tens of millions of ads to the few thousand we consider showing someone"

This means net-distinct concepts versus variants will move the needle more in an ad set. Though it's the 1-2 punch. The 1 is net-distinct concepts and then the 2 amplifies that with variants by leaning on their ever-expanding AI capabilities (all the possible combinations to check off from AI text generation, to dynamic static variants and music overlayed).

And what to do when all the spend goes towards one? Stay tuned, I got an answer for that. For now, the short answer is SPAMS, like the lunch meat.

[1] Source material from Meta: AI Innovations in Meta's Ad Ranking Driving Advertiser Performance

A wearable DTC founder I was advising could tell you his Meta ROAS to two decimals: 1.57. But every Shopify order was losing money...and he had no idea.

I asked how he was measuring performance.

“Just looking at Facebook,” he said.

This usually means decisions are based on channel data versus profit. A dangerous pattern I've seen across 100+ brands.

He was buried in Facebook Ads Manager. Weeding through ROAS, CPA, CTRs and figuring out what the hell was going on.

I call this Metric Minutiae, because it’s putting the cart before the horse.

The issue is Facebook ROAS often drifts from what’s actually happening in the business.

Meta undercounts purchases and can lead to misleading decisions

It’s like a customer walks in from a billboard and the cashier gets credit. I’ve seen this from $2M brands to $1B enterprise brands. Still wild to me.

Letting him keep running off partial data felt negligent.

So I introduced him to Contribution Profit.

It's what’s left after subtracting variable customer expenses from order revenue (COGS, merchant fees, fulfillment, and ad spend).

What’s left “contributes” to overhead and profit. It maps straight to your P&L. That’s why Contribution Profit ranks at the top of our Signal Stack, our framework for prioritizing metrics.

Here’s the napkin math we did:

‣ Average Order Value (AOV) = $86

‣ Variable Customer Expenses (VCE) = $40

‣ Customer Acquisition Cost (CAC) = $47

$86 AOV – $40 VCE – $47 CAC = –$1 Contribution Profit (CP)

Every Meta order was losing $1. As acquisition gets harder, his losses would compound.

Here’s how we'd start fixing it:

(1) Find breakeven ROAS per offer

Formula: AOV ÷ (AOV – VCE) → $86 ÷ ($86 – $40) = 1.87

That’s your floor. Below = loss. Ideally, your first order clears it otherwise you may need capital to cover overhead and inventory.

(2) Compare it to your actual ROAS

Check:

‣ Blended ROAS (total rev ÷ ad spend)

‣ New Customer ROAS (new customer rev ÷ ad spend)

‣ Meta ROAS

If Meta is under breakeven but blended or new customer ROAS is above, you might be in better shape. Meta’s likely underreporting, especially if Meta’s your biggest acquisition channel. If you're below, it's a sign to recalibrate: adjust bids, ads, offers, landing pages.

(3) Use a real dashboard to show real-time Contribution Profit

Triple Whale’s free version syncs Meta, Shopify, Amazon, Google, Klaviyo, and expense data. Use Net Profit as a proxy or upgrade to track CP directly.

Meta ROAS still matters as a tertiary metric but for business health, Contribution Profit is True North. At the end of the day, it's just asking “Are we losing money or making money from marketing?”.

As far as the founder, a few weeks later he DMed me saying:

"As you pointed out, there were a lot of sales Meta wasn't picking up...[and tracking Contribution Profit gave] a much clearer picture"

"It’s been my best week by far...really appreciate your guidance. It's made a real difference already!"

Marketing Didn’t Just Sell Products. It Changed Human Behavior.

In 1946, Reader’s Digest ran a full-page ad:

A man in a white coat. Calm. Trustworthy. Medical authority used to push a product that killed people slowly. And it worked.

By the 1950s, Coca-Cola ran ads urging mothers to give soda to toddlers:

Billions of dollars were poured into normalizing cigarettes, sugar water, and ultra-processed food. These weren’t accidents. They were the result of brilliant storytelling, relentless media buying, and mass distribution. And they changed human behavior. Forever.

The Machines Still Work. We Just Point Them Differently.

The machinery behind those campaigns still exists. Only now, the lab coat has been replaced by a ring light. The magazine ad has become a TikTok. The voice of authority is now a legion of micro-influencers promoting Big Food “Health” with good intentions…
While it’s easy to unknowingly push formulas packed with dyes, fillers, or chemicals.

So yes, marketing still works. Which means we need to ask: What are we scaling now?

We run a Direct-to-Consumer agency called Emblem. We build enduring profit-growth systems for better-for-you DTC brands doing $2M-$20M in annual revenue. But that’s not where this story starts.

It starts in a memory care facility.

Why This Is Personal: A Memory Care Facility, and a Mission

My dad was a top engineering graduate in Communist Vietnam. He defected and escaped to France, wrote a book called I Quit the Party

“I Quit the Party” by Quynh Huu Hoàng. The Statue of Liberty signifies the freedom and opportunity of the U.S.

On the weekends gave me extra math homework haha, he was that kind of dad. He’d take my brother and I to play tennis. Go swimming. Taught us photoshop in the early 2000’s before we even knew how useful that would be.

He ate for survival. Whatever was fast, easy, salty, and cheap. Physically he appeared healthy and never looked overweight. But inside, type 2 diabetes was destroying his body and mind.

After a major stroke, he was diagnosed with vascular dementia. He’s now on a feeding tube. I haven’t heard a single word out of his mouth in years. The man who taught me how to live can no longer respond.

My mom is a different story. During the weekdays, she raised twin boys by herself in the Projects of Los Angeles while running her own business as a hairstylist. She spoke three languages: Vietnamese, French and English. Did her own bookkeeping. She exercised. Made green smoothies. Stayed sharp. But she also had one quiet vice: sugar, chocolate, pastries, ice cream—sweets were her comfort.

Now she has frontotemporal dementia.

Last year, my brother last year found toxic bleach cleaner in her shower—presumably because she thought it was shampoo. She struggles to get through a full sentence.
Every word takes visible effort.

Both of my parents were smart. Active. Independent. And still, they declined cognitively (my dad physically and eventually my mom). Not suddenly. But gradually. Over years.

What caused it? That’s the haunting part.

• Was it their nutrition?

• Their sub-optimal exercise?

• Their lack of exposure to Zone 2 or VO2 Max training?

• Their ALMI (Appendicular Lean Muscle Index) dropping without warning?

• Their sleep?

• Their stress?

• Their emotional environment?

• The strength of their relationships?

We’ll never know exactly why. But I do know this:

They did the best they could with what they had, and what they knew. From two kids who grew up in the Section-8 Housing in Los Angeles. To my brother graduating at Harvard. He’s since a senior engineer at Instagram. I gratefully graduated California Berkeley. And now I’m bootstrapping Emblem.

But more importantly: we’re healthy. We have a tribe. We’re building forward.

This is at my brother on Harvard graduation day. When my parents were both able to walk and talk freely. Left: Mom, Brother, Dad, Me.

A testament to parents who gave up the world for us by moving to foreign lands. From refugees to immigrants to starting from zero, that outcome alone is a miracle.

And maybe that’s the point: Small inputs do compound. For our lives, for our businesses, for the lives we touch. Not just in decline—but in strength, in health, in connection, in resilience. Especially when they’re chosen on purpose.

Signals of a Better Normal

So when I say this is personal, I mean it. This is why Emblem exists. Because we’ve seen what happens when we scale the wrong things.

The beautiful thing is there’s opportunity to scale a better normal.

Food Systems Expert and Author Anne Lappé says, “Every time you spend money, you're casting a vote for the kind of world you want”. So let’s choose the world we want.

Some brands you can feel that they were built as a labor of love. Not just to ride a trend. Like they genuinely give a damn about how their product shows up in people’s lives. These are a few that have stood out to me.

• Maui Nui is turning Hawai‘i’s invasive Axis deer population into a regenerative meat supply chain. By doing so they’re helping overrunning Axis deer from causing plant species loss, soil erosion and threats to ranchers, farmers and the local population. They prioritize wild-harvesting so the deer have the highest quality of life that also results in nutrient-dense venison.

  • I’m a proud grandfathered subscriber to their bulk jerky pack. Matter of fact, it came in clutch yesterday when I needed 20g of protein with barely any calories to spare. 10g of protein for 55 calories is still the wildest macro profile I’ve seen. When the Maui fires happened, they prioritized food drives as their first move. That tells you something.

• Birchbury makes barefoot shoes built for performance but refined enough for business meetings or weddings like customers around the world have proven. Functional, minimal, well-made.

• Carnivore Aurelius is a long time partner and we’ve been working together with paid social for the past 5 years. With nutrient-dense products that are meticulously sourced like liver crisps, collagen, steak crisps. His content ranges from alpacas, memes, satire and a kind of troll for good. Built on a bedrock of earnest and just trying to share what’s worked for him. A very different kind of brand but an amplification of him in the style of, as he’ll say, “Silly goose time.”

  • What I respect most about him is how the brand’s evolved like a human. He’s shifted views, adopted new ones, stayed honest the whole way through. He literally changed his entire brand from an Instagram profile photo of a statue of Marcus Aurelius to an authentic photo of his back walking in a green forest.
    

• True Nutrition is my favorite Protein Powder brand. Ironically enough, I like them because of their sorta anti-marketing gimmicks stance. How everything goes back into product. They’re completely customizable to the point you can customize a jar of protein to have something as wild as 70% whey protein isolate, 20% beef protein and 10% egg protein. Customize the flavor’s sweetener and intensity level and add “boosters” like creatine, collagen, turmeric, and supergreens. The operational feat they’ve pulled off is impressive.

  • Their products have been with me since 2013 when I traveled abroad and a fellow buff Italian student said this was the best of the best protein and we group-bought a bulk order. I’m glad we did that. I did the math: I’ve consumed over 150 pounds of their protein by now. Been using them through bulks, cuts, conference trips, and now daily health for optimal protein. We even made them a commercial grade spec ad because I'm a big fan of what they've built.

These aren’t surface-level “mission-driven” brands. If the products we buy shape culture, then these are the brands shaping it in the right direction.

If culture is downstream of commerce, these are the kinds of companies I want upstream. Commerce leads, culture follows.

That’s why we’re proud Marketing Partners with some of them and champions of others. It’s the kind of growth worth protecting.

What We Do at Emblem

Emblem helps better-for-you DTC brands with enduring profit growth. Direct-to-Consumer Brands doing $2M to $20M a year that want to grow without compromising the reason they exist.

Sleep, cognition, nutrition, muscle preservation, energy, focus, emotional regulation.
These aren’t buzzwords. They’re survival levers.

We build acquisition systems that contribute to good living and that contribute to profit.

• Media buying tuned to Contribution Margin (both the contribution of dollars to the business and the contribution upon customers).

• Creatives based on a Creative-Portfolio Framework mapped to offers, avatars, angles, media types, and creative styles.

• Hyper-Specific Experiences through landing pages, advertorials, listicles, and checkouts so the message signal is highly relevant versus generalized and ignored.

We build structure that protects your business and your mission.

Our Belief: Profit and Purpose Are Not Opposites

Founders pour everything into building something meaningful. We build systems that honor that effort and not just the algorithm. Because we give a damn. About inputs. About outcomes. About attention. Every ad impression is a moment with someone’s brother, someone’s mom, someone’s partner, someone’s future self. We take that seriously.

You don’t have to choose between doing good and being profitable. You just need systems that let you do both.

Where We’re Headed: A Healthier Culture, Built on Better Brands

We believe the most profitable brands of the future should also be the most beneficial to human life.

We believe marketing is a lever that can fix what marketing broke. That the next Coca-Cola moment should belong to a product that preserves cognition. That the next household names won’t be 3 Billion Dollar conglomerates but of thousands of niche brands by people who stand for something. Brands that’ll help people move, sleep, and think better. Instead of contributing to all-time-high charts of death, disease, despair.

We’re reminiscent for when food had fewer ingredients and life had fewer algorithms. We keep that nostalgia with us while being ready to build forward.

For the founders, product designers, operators, marketers, spreadsheet wizards, that create brands and products they proudly put in the hands of someone they love.

We champion that and will do our best where we can to support these adventurers of daring brands along the way.

Because what we scale is what becomes normal. Let’s make sure it’s something worth normalizing.

Let’s scale what matters.

Kenny Hoang is the Founder & CEO of Emblem. For 2025, he’s reading a GPT-curated book list, getting back in Jiu-Jitsu, and this year, working on improving his resting heart rate with Zone 2 and 5 cardio. He’s based in San Diego with his wife. Connect with Kenny on X and Linkedin.

DTC is damn hard...

Pre-2020’s was the tail-end of its original manifesto.

• Cut out the middle person (distribution/retail/wholesale)

• Own the customer

• Pocket large margins as an early adopter

Then the squeeze began…

• Tech stacks & ad channels are widely available. More like a tax than a moat (Shopify/Meta/Google)

• Baseline of content talent up means attention is more expensive

• Amazon, Temu, Alibaba = margin vampires

• Tariffs and supply chain unknowns

• Market sentiment (inflation)

• iOS14.5, GDPR, CCPA

The Overton Window is a concept from political theory. It refers to the range of ideas or behaviors that feel socially or professionally acceptable at any given time. What’s considered “normal” shifts over time. What used to be radical becomes table stakes.

That’s exactly what’s happening in DTC.

The level of operator competence, creative quality, media buying complexity, and financial literacy that once stood out… now just lets you compete. That’s why I say the Overton Window of DTC sophistication has shifted:

• DTC Easy → DTC Normal → DTC Hard → DTC Insanity Mode (?)

So if it feels like you’re working twice as hard for half the result—it’s not you. The bar moved.

It’s like school:

• Marketing: Proficient in Science, Art & Psychology.

• Operations: Proficient in Shop & Debate.

• Finance: Proficient in Math & Statistics.

Seems like to even survive requires operational excellence across the board.

If you want to thrive now, you can’t just be great at one of these. You need to be competent in all three and excellent in at least one.

The bright side is opportunity is in the hard as wise people say.

Scary? Yes.

Exciting? Also yes.

Darwin said adapt, ay? I'm excited by the solutions and innovations that come out of it. We'll see how this industry evolves.

Deep breath

Good luck all.

What would you add to "The Squeeze?

What "classes" are you taking to be competitive?

What DTC game level do you think we’re at? (DTC easy, DTC normal, DTC hard, DTC insanity, something else?)

Kenny Hoang is the Founder & CEO of Emblem. For 2025, he’s reading a GPT-curated book list, getting back in Jiu-Jitsu, and this year, working on improving his resting heart rate with Zone 2 and 5 cardio. He’s based in San Diego with his wife. Connect with Kenny on X and Linkedin.

Chasing the highest ROAS often limits DTC brands from achieving their true growth potential.

Instead, sustainable growth in DTC requires a Contribution Profit-first framework supported by a Signal Stack of key performance indicators. Like how a Tech Stack is a portfolio of technology and apps that support your brand’s underlying structure, a Signal Stack prioritizes your metrics into what to focus on first. That way you align marketing metrics with meaningful business outcomes.

Instead of being overwhelmed with metrics, should we be looking at CPC, what about our AOV, XYZ, it gives clarity. There’s a time and place for deeper dives into tertiary signals but if your car were on fire, you wouldn’t be eager to see if you need an oil change. This isn’t about chasing the highest ROAS or Blended ROAS, it’s about aligning all metrics to your absolute profitability goals while growing with intention.

Contribution Profit is what actually matters. It’s the cash left after covering your ad spend, cost of goods, and customer variable expenses (like pick and pack, transaction fees, and last-mile shipping). It’s the money you have left to “contribute” to operating expenses and net profit.

Here’s the formula:

• Order Revenue* - Ad Spend - Customer Variable Costs = Contribution Profit

Now, here’s where a higher ROAS falls short. In a hypothetical example:

1. At a Blended ROAS 3.2, $100K in ad spend generates $320K in revenue. After subtracting $112K for COGS and customer variable costs, and Ad Spend, you’re left with $108K Contribution Profit (33.8% Contribution Margin)

2. At Blended ROAS 2.6, $200K in ad spend generates $520k in revenue. After subtracting $182K for COGS and customer variable costs, you’re left with $138K Contribution Profit (26.5% Contribution Margin)

Lower Blended ROAS efficiency and Contribution Margin efficiency, yet $30K more in absolute Contribution Profit. Aka dollars in the bank that can be used to contribute to Operational Expenses and what’s left is Net Profit.

This doesn’t mean blindly scaling your ad spend. There’ll be a point of diminishing returns where incremental spend creates negative Contribution Profit, and that’s hidden in averages like blended ROAS (MER)

The goal isn’t perfection but balance in your Signal Stack:

• True North Signal: Contribution Profit and Contribution Margin

• Primary directional signal: Order Revenue, Blended ROAS (MER), Blended Acquisition Cost, Blended AOV, Total Orders

• Secondary directional signal: New Customer Order Revenue, New Customer ROAS, Customer Acquisition Cost, New Customer AOV, Returning Customer Order Revenue, Returning Customer %, New Customer and Returning Customer Orders

• Tertiary fine-tuning signal. Facebook Ad Spend and Google Ad Spend. Channel-specific ROAS like Facebook and Google ROAS

Scaling profitably and sustainably means focusing on the cash in the bank, not just chasing efficiency metrics. Change the incentive of what’s rewarded and growth will follow.

*Order Revenue = Gross Sales - Discounts + Taxes + Shipping. This is before returns because we would want returns viewed as a Product component and distinguish it from Marketing. For example, what if one day the product quality increased and returns decreased, credit is in Product Development.

Kenny Hoang is the Founder & CEO of Emblem. For 2025, he’s reading a GPT-curated book list, getting back in Jiu-Jitsu, and this year, working on improving his resting heart rate with Zone 2 and 5 cardio. He’s based in San Diego with his wife. Connect with Kenny on X and Linkedin.