20 Aug August 20, 2020 – Molio Method Jeff Davis and ION Franchise Lance Graulich
I found more opportunity than difficulties in the last global crisis.
From a personal and business standpoint, we came out in a
stronger better way.
Jeff Davis, Founder of Molio and Adjunct Professor at Univesity of Utah, is a rare executive that has run global billion-dollar businesses and has also successfully launched two startups with successful exits. At the University of Utah business school, Jeff serves as adjunct professor of Marketing and is a published academic author. For 23 years, Jeff Davis built brands at Procter & Gamble, in various leadership roles in numerous product sectors, and in several countries. After retiring from P&G in 2009, Jeff was the angel investor, board member and eventual CEO of Orabrush Inc., which pioneered Molio’s model and successfully built the Orabrush tongue cleaner brand. According to Google, Orabrush was one of the first companies to build and commercialize a product on a global level leveraging YouTube advertising only. Google recognized Orabrush as one of the 10 most iconic ad moments on YouTube alongside billion dollar brands. Currently, Jeff is the Founder and CEO of Molio Inc., a venture-backed, creative and media analytics agency, famous for building brands on YouTube with capabilities to originate, co-create and validate new brands with its Innovation and Validation Model at AM:LABS.
Lance Graulich – Founder and CEO at ION Franchising
Selecting a franchise for yourself is like selecting a spouse.
You plan on being together for years!
Lance Graulich is the Founder of ION Franchising, an industry-leading franchise consulting and development group that represents over 500 franchise brands & business opportunities within 90 categories. Lance helps entrepreneurs and business owners navigate the waters of opening a franchise so they can achieve financial independence in a more hands-off way. Lance started out in the family business on Wall Street after receiving an economics degree. He then joined a TGI Fridays franchise in Phoenix, Arizona, as a key executive and was vital to the rapid growth of this $225,000,000 organization. As a business start-up expert with more than 25 years of experience, he has served as President of various franchise advisory councils and boards advising emerging franchise brands.
Highlights from Jeff’s Interview
I love the premise that it’s not an idea, you don’t have to be creative to be an entrepreneur, because I agree with that. Because I retired from P&G at 48 years old, 23 years, I spent 15 of those 23 years abroad, I was in five different countries, six different businesses of P&G, I was running a global billion-dollar division of their beauty care salon professional space, and never could have predicted I was going to be a venture capitalist startup guy. It was not exactly as I planned, and when you’re a global General Manager VP at Procter and Gamble, you get pretty good at planning. So I think part of this for anyone that is an entrepreneur, there’s a certain level of process but you just can’t predict it. So I was the angel invest for these two amazing guys.
The quick story on Orabrush, which is pretty significant in my life journey, is Orabrush is a four-time Google case study. The first one which is pretty relevant is, Google, more important than Jeff Davis, says that Orabrush tongue cleaner was the first product to be commercialized on a global level just using YouTube advertising. When I first met Orabrush I had left Frankfurt, Germany, I had been international for 15 years, returned to Salt Lake where I originally lived; P&G had hired me right out of the University of Utah. These guys met me, they had five or six million views on YouTube, which at the time was pretty significant. So I was fascinated with that, because we were beginning to try and understand this new medium. Promoted video, importantly, had just become a thing on YouTube in June of 2009. So again, we really were one of the first companies to think of YouTube as an advertising platform, as a new way to create awareness and trial for your product and service. I think it was 2010 roughly, I had invested in Orabrush. I eventually became the CEO, Jeff and Neal Harmon were the young 20 somethings that were, again, brilliant on the YouTube platform. They were just ahead of their time. They didn’t have any tapes of former corporate experiences in how you did marketing, they just had grown up and knew a lot about YouTube.
The founder and patent holder of Orabrush product was a 78-year old entrepreneur, so it’s another amazing story. He tried to license it to P&G, tried to license it to Colgate, no one wanted it. Then eventually, Jeff Harmon said I can sell that for you on YouTube, the now-famous 2:14 YouTube video that went viral. Then by the way, we did just what I did at P&G, spent a lot of ad money to drive that awareness and trial around the globe. That story from Google, we took it to 25 different countries, 30,000 retail outlets, all just with YouTube. Eventually we did some other things, but we just did it with YouTube and it became one of the 10 most iconic ad moments on YouTube. When YouTube celebrated in 2017 their 10 years of being a platform, they recognized the 10 most iconic brands. The other nine you would know, it’s Dollar Shave Club, it’s Van Damme’s Volvo, it’s Jeff Gordon with Pepsi. It’s all these iconic, big brands that finally learned about the platform of YouTube. What I loved about Google and appreciated their recognition was that we were first and we were on that list, the 10 most iconic ad moments on YouTube.
I just never would have envisioned my post-P&G career was going to be as a startup guy and a Google case study and dealing with the tongue. In fact, it’s amazing, I kind of offended Dr. Bob Wagstaff. I offended him when I first met him because I was just curious about the marketing story. I remember saying, well, I don’t really care about the product. I had run oral care at P&G and certainly knew a lot about the category, I didn’t care about the product, and I offended him. He says, you use this product for one week and then you tell me it’s not about the product. So 80% to 90% of bacteria on your tongue is what accounts for bad breath, and Bob created this amazing tongue cleaner and scraper that removed the bacteria from your tongue and helped to cure bad breath. Something by the way, they scrape their tongue more in India than they actually brush their teeth. It was more something that the American population or the Western culture was not aware of. So we became the number one tongue cleaner the world, and eventually so sold the company to DenTek™ Oral Care for $14 trillion.
So then, that led to Molio. Molio in Latin is ‘to build or construct.’ Actually, my Co-Founder CFO was the guy that came up with that. We knew we were onto something with Orabrush. So once we built it online and offline, we launched a second product just to validate with our investors we could do it twice, we launched a product called Orapup, which is a tongue cleaner for dogs, and drove that, by the way, about $3 million in about nine months online back in 2012. This was just really the early days of eCommerce. Picked them up on YouTube, drove them to Orabrush.com or Orapup.com, transact with them right on the website; there was no Amazon or anything like that yet. So it was just these early days and I just was drinking from the fire hydrant. I’d get up early in the morning to watch YouTube videos, just so I could understand what my 20 something little startup guys and gals were thinking about that day when I went into the office. I was just completely trying to retool and rethink and understand what was happening.
By the way, again, I was with one of the preeminent marketing companies in the world still today, Procter and Gamble. I really was classically trained in how you create awareness and trial and conversion and repurchase with consumers. This was just what was amazing with Jeff and Neal Harmon, these young guys that I had invested in and then became CEO working with them, was we would go out there and we were creating videos that were costing $5 to $1,500 per week. We created in fact a series, this is one of the things that Google loved and talked about in the case study. We created Diaries of a Dirty Tongue, and it basically was this episode every week of this giant life-size tongue; the Charlie Brown of bad breath. We would create this ongoing subscribers to our channel. There was a period from 2012 to 2014, Orabrush was the most subscribed product channel on YouTube, ahead of, by the way, Coca Cola and Apple and Old Spice. Now, eventually those guys took us over, they had little bigger budgets. But I knew we were onto something.
I remember we were down at YouTube in San Francisco, and I remember them saying, “Jeff, you just don’t get it, do you?” I said, what do you mean? We had 300,000 subscribers at the time to our YouTube channel. They said, a small regional cable television is 300,000 to 500,000 people, you are like a national cable channel for oral care, and people are opting in to be advertised. I remember these vignettes, these long form videos, we were doing videos two to five minutes, no one was doing that; everything was 15s and 30s, and the typical 60s. These guys didn’t have the typical mention the brand name Orabrush 20 times. I was like, we don’t even say the name. He goes, trust me, you can’t do that on YouTube, it’s a giant life-size tongue. At the end of it, we would tie up these little episodes, and sure enough, traffic was going to Orabrush.com. We were converting, by the way, at one time, 10% of the traffic. Even on our worst days before we sold, we were converting 3-5% which was way above any normal conversion rates, which are normally around 0.5-1%. So we just knew we were onto something.
This ties up a little bit to what was then this genesis with me and my investors, and that we knew we were onto something in my new startup world. This was 2011 or 2012, I had just assumed the CEO role. I said, start with digital, start with video, start with YouTube. I remember all my P&G colleagues and people laughing saying, what are you talking about? Of course, we picked the right horse, today YouTube has become this juggernaut. I remember saying in the early days, YouTube is going to be like TV. Well, there’s YouTube TV today. So we were early, these young people I was learning from, my world was clashing from them traditional marketing with new digital marketing, in this case, new digital video marketing, which is, again, the evolution of Molio. We spun that out in 2015 with True Ventures out of San Francisco, a very prominent venture capital group, amazing group of people that I learned from, and the founder group within that. Then Greycroft out of Los Angeles from New York, Album VC out of here in Salt Lake City, and then we had Technicolor out of Los Angeles, and Advancit Capital out of New York.
I always believed that people that had backed me were just so much more preeminent and wise than me, I always felt such an obligation to try and do something. But to tie up the story, Molio was going to be a programmatic ad bidding software on this YouTube stack. Today Molio wouldn’t necessarily be venture-backed, it’s a digital creative and media analytics agency. But what happened was we built some really cool things on the YouTube stack, and then YouTube, we knew them well. They used to fly folks out to Provo, Utah, from San Francisco, from Northern California, as we were helping them to create TrueView skippable, the one today that you could skip after five seconds. That was something we very much helped create with YouTube. At the time, Shishir Mehrotra
was the Vice President of Development and Software. We were very much this little company in Salt Lake who was collaborating and helping to build what we have today, the TrueView skippable format that they monetize extremely well now. So we got shut down from YouTube, they said, “Jeff, it’s really cool what you’re doing, we can’t let you do that.”
So we then pivoted to what we are today; a creative media analytics company. We like to say we bring brands from obscurity to relevance. We have a number of really cool case studies, we’ve got a innovation upstream where we launch products: originate, co-create, and validate new products. Then we also have, it’s wrong to call it traditional, but a digital creative video agency with media and analytics. So full creative strategy in-house, full media and analytics in-house to help people build and launch their brands.
Yeah, listen, I think it’s interesting, best practice today. If you think of the attention deficit of all of us, certainly the younger folks, but all of us are guilty of what needs to be six seconds TikTok to Snapchat to the various platforms that have evolved. Power core is video, and we go a little bit against the, the current belief, we like to use long form video to learn. Again, today an iPhone 11 is much more sophisticated than what we had 10 years ago, with a lot more cost. You can pull something out, shoot something, you can load it up and add words, you can spend $12-15, you can understand who’s viewing through it, you can see audience’s demographics, their likes, their interests. It’s what fascinated me in the early days of Orabrush, that from traditional syndicated data that I would get weeks later, and then from media companies that would provide me sometimes months later whether my campaigns were successful or not, that we literally real time were making adjustments on intros and conclusions, conversions, pricing messaging.
So the Molio Method, as we affectionately call it, is the integration of content and media analytics. So my tips are, don’t always just think it’s got to be short. Eventually, it might get short. If you look at most of what Molio does, we’ll have long form still on our YouTube channels, but then we’ll have the best 15s or 30s for Instagram, we’ll have the best 1-minute versions for Instagram, we’ll have the best 6-seconds for bumpers on YouTube or potential Snapchat or TikTok type executions. So we learn and use a lot of the analytics in AdWords and in Facebook Manager to really figure out what these analytics are on the content and against which audiences. The Molio method, simply put, is finding the right content at the right length against the right audiences that can be scaled with significant ad dollars as you then build a brand and scale it.
I remember when I was getting introduced at the end of Orabrush and the beginning of Molio, they’d always talk about viral YouTube sensation, Orabrush and Jeff Davis. Look, it’s really important. There was some virality, our content was so unique and we were getting at the right audiences, it was being shared without paid media. But the truth is, just like I did at P&G with other media, I was scaling it on paid media. Whether it was Poo-Pourri
, which is a really interesting Suzy Batiz’s company. She’s actually been on Forbes and on number of magazines talking about the empire she has built out with that original product, Poo-Pourri
. We did a two-year run on the media and analytics for her on that. This is another really amazing story, collaboration again with Jeff Harmon and Neal Harmon in the sense they did all the creative on it, and then Molio did all the media and analytics. So it was the original Orabrush team that actually helped and launched Suzy’s idea. It was a fragrance essential oils that you put in the toilet before you go number two, and it eliminates the stench of going to bathroom.
At Molio.com, you can find out about me and my company. Our incubator and accelerator is AM:Labs, you can also find that on the Molio.com website. You can follow me on twitter @davisjdd. We’re about brand building. I guess I would close with, I’m writing an essay right now that’s entitled, “In a rapidly changing complex world, the only thing that matters is your rate of learning.” How true is that now! Actually, this is something I started 10 years ago when I was spending a bunch of time in my last assignment at P&G in Brazil, Russia, India and China. P&G was mapping out in the developing world, where’s this going to go, where’s the puck going? So I really learned that it didn’t matter if you went to Stanford or Harvard or the University of Utah or you’re a Vice President or whatever your former credentials were, there was no playbook for distributing products across the complexity of India, or China, or Brazil, or Russia. We’re very much again in that vein today.
As an entrepreneur, or by the way, whatever you’re doing, you really have to continue to learn new things, because there are playbooks that are being written as we go right now. Certainly with the COVID pandemic, I would say that’s the case. I’m reinventing my little company of five years again. I think that it’s just really important, what can you do to try and manage your way through it on a personal level as an entrepreneur? Keep learning, learning the things that are relevant, and where the puck is going. I ran a P&G pharmaceutical business in Canada for five years. Gretzky whose all-time goal record will probably never be surpassed, when people asked, how did you do it? He said, well, most people skate where the puck is, I skate where the puck is going to be. Today more than any time in my 59 years and 30+ years in the workplace, it’s rapidly changing again, and therefore you’ve got to be learning the new things that are going to make a difference. Just like a decade ago, I was smart enough as an old guy to look at and collaborate and collide with these millennials who were hanging out on YouTube. So don’t just talk about it, learn and do it. Just do it and learn it, by the way, sometimes in reverse order.
Again, can everyone be an entrepreneur, you’d have a debate about that, but everyone can go off and just begin to do things. Today, with the various platforms, again for a couple hundred bucks and an iPhone, you can go test a lot of theories and ideas about a book, about a product or a service; any widget, pick one. That’s what I love about this time in which we are living. Some people complain about it, I think it’s the most opportunistic time of my life. I’ve had a few decades to work through some different scenarios. Remember the last financial crisis, I was running a billion-dollar division of Procter and Gamble. I found more opportunity in that crisis than the difficulties. Was it difficult? Yeah, lots of people suffered and it was difficult as well. But both from a personal standpoint and the business at least that I was running, we came out of that crisis in a stronger, better way.
Go to Molio.com, you can get ahold of me there for sure; all the credentials are there. Follow us on our social channels, all of our social channels are linked down there on Molio.com. It’s been fascinating for me as we decided for the first time in our five years to do outreach, to explore, getting some unique brands to come and see if we can help. We’ve had the blessing, between my former P&G network and our investors, we’ve had a never ending interest from brands to work with us. We only work with 10 to 15 brands and we have dedicated time, you get a lot of my time, you get a lot of my partner’s time, Sam Cannon; former Razorfish creative, North American executive. We just love to build brands, we love David and Goliath stories. If you look at a number of our case studies on the site there, we love to bring brands from obscurity to relevance. It’s not easy to do these days, and my team is really good at it in spite of their founder.