September 16, 2022

How to Arbitrage Omnichannel Growth with Morning Brew’s Austin Rief

We sat down with Austin to dive into how to build a modern media company, covering:

  • Morning Brew’s key growth levers and ongoing arbitrage opportunities
  • Flows behind how his team tests and validates new content verticals
  • How he turned a daily newsletter into an omnichannel media engine
“Disco is a no-brainer. It’s one of the quickest investments I’ve ever made, mainly because we’re in one of the greatest headwinds in DTC history since 2000.” 

Morning Brew’s Core Growth Channels

Since 2015, Morning Brew has been propelled from a startup run by college students to a staple newsletter in the inboxes of countless execs, from Wall Street to Silicon Valley. 

Austin summarizes the channel mix that enabled this as threefold: 

  • Word of mouth — Primarily driven by their referral program, which remains a significant method for user discovery for the company
  • Paid channels — More specifically, Austin highlights: 
  • Instagram — As one of the first 100 or so advertisers on Stories, Morning Brew could leverage the channel for massive early growth. According to Austin, their first day saw subscriber acquisitions for the cost of three pennies. 
  • TikTok — As paid acquisition remains a major tactic for Morning Brew, Austin admits TikTok is worth the industry hype and could be a huge “grand slam.” 
  • Cross-promotion & advertising — Since their earliest days, Morning Brew bought ads in other newsletters, which continue to generate some of their highest-LTV acquisitions. 

As for how his team gauges metrics attached to these channels, Austin explains that Morning Brew places less emphasis on CPA (or cost per subscriber). 

Rather, the KPI that’s the name of the game is cost per high-quality subscriber. For instance: 

  • The Morning Brew team found strong correlations between readers who show high open rates early on in their subscriptions and readers who go on to remain engaged. 
  • This approach soon became a game-changer in directing cross-promotional efforts. 
  • By running ads in other newsletters, Morning Brew categorically reaches habitual newsletter readers and drives high-quality new subscribers in the door.

Although CPAs run higher when buying a newsletter ad, those upfront costs for acquiring readers who become high-LTV subscribers are more than a fair tradeoff. 

“Growth marketing is manual grunt work. It’s honestly a grind. But arriving early to a platform — for us, that was Instagram Stories — is huge. In the year that Insta launched their ad product, we went from 100,000 to 1 million in readership.” 

User Testing & Validation Methods

In terms of growth, Morning Brew has also steadily expanded from its singular newsletter product to something of a media behemoth — encompassing email-based editorial, podcasts, accelerator courses, and merchandise lines. 

Austin takes us through a couple of the team’s processes for testing and validating category expansions with their user base. 

B2B Publications

For Morning Brew’s newsletters catering to industry operators — these are closest to their original daily product, including Retail Brew, Marketing Brew, and Emerging Tech Brew — Austin outlines their rubric that’s been finely tuned over time. Fundamental questions include: 

  • Is there enough content to cover that won’t lose steam over time and drain resources?
  • Is the industry at hand evolving enough that people need to stay on the cutting edge? 
  • Are there enough folks in the industry who would read an ad-based publication? 
  • Even more: Are there generally enough advertisers in the space? 

Podcasts & Original Content

On the podcast front, as Austin tells it, the Morning Brew team seeks out individuals who generate active user engagement through inimitable creative takes on the industry. 

They’ll then only bring on a creator after they’ve tested well with existing readers and listeners. 

Austin summarizes Morning Brew’s creative criteria into 2 questions: do people care what this creator is saying, and do we see signs of something that’ll become much bigger with time? 

“You have to test to amplify what works and shut down what doesn’t. But Morning Brew also has something we strongly believe in bringing to the world. So sometimes — just build for your vision and see if the audience will come.” 

Beyond One Brand: Running a Multi-Vertical Operation

In evolving a newsletter brand into an omnichannel media company, Austin highlights a reality of the industry that’s followed Morning Brew throughout every stage of growth: 

Marketing, acquisition, and broader growth efforts all remain largely manual, executed by teams with the aid of software — not the other way around. 

Despite this, Austin affirms omnichannel expansion (as well as the necessary scaling of manual growth efforts that’ll follow) is easily the clearest pathway to continuing to best serve Morning Brew consumers, for years and years to come. After all: 

  • Building pure brand exposure and recognition of Morning Brew is best accomplished by simply being everywhere — and subsequently capturing users everywhere they can. 
  • With Morning Brew’s current capabilities, having the brand be everywhere all at once isn’t just possible, it’s likely their most viable tactic for leading potential readers, listeners, and viewers to jumpstart the flywheel — from almost any channel on the web. 

Austin adds that for high-growth brands looking to scale their omnichannel digital expansion, he recommends leveraging Disco’s ML-powered algorithm. More specifically, Disco makes it easier for brands to appear in more relevant places with extremely low lift and additional overhead.

How to Balance Lift and Efficiency

As for how an omnichannel entity as massive as Morning Brew handles the reality of costly, manual growth work in 2022, Austin describes balancing lift and efficiency as the key to it all. 

  • For instance, while a B2B SaaS enterprise wouldn’t typically need to join Instagram, if an intern or associate manages socials, it’s little lift required in terms of labor and capital. 
  • Or, in the case of Morning Brew, even if having a YouTube presence isn’t a key priority, hosting long-form content becomes logistically efficient since it can be repurposed into shorter hits for, say, TikTok or Instagram Reels with little or no additional effort.

In Austin’s words, his north star goal is to have a promotion machine on every platform. 

And even if every incremental channel isn’t a priority for Morning Brew, each one ultimately contributes to the company becoming the most recognizable name in the game. 

“We’ve built Morning Brew to a point where we’re no longer saying, ‘Let’s grow this one social account.’ Instead, we want to grow this franchise, this media engine with many different properties — and we want to grow all of them together.” 

Digital Arbitrage & New Acquisition Vehicles

When asked how he’d advise an emerging brand on acquisitions in 2022, Austin outlines certain tactics as “no-brainers” in terms of where to start. These include: 

  • Branded, retargeted Google Ads
  • On-brand partnerships with like-minded merchants
  • Word of mouth & referral programs, though he warns you’re better off without them if you’ll only be able to execute poorly or haphazardly
  • Getting set up on socials like Facebook, especially if you can generate easily shippable and repurposable content for those platforms

At the top of the list, Austin also advises brands of any stage and category to leverage Disco. 

In his words, Disco presents one of DTC’s first major headwinds in over two decades — by providing viable solutions to modern brands struggling with the fact that: 

  • New consumer platforms — even those Austin loves, including TikTok — are stagnating, seeing as they’re bound to become oversaturated and thus more expensive to leverage 
  • And waves caused by giants like Apple only continue to upset an already volatile industry, amid soaring CACs and hyper-competition across every vertical

For any high-growth brands looking to leverage new growth channels, Austin recommends Disco as an untapped acquisition opportunity to target and reach brands’ most profitable customers.

“My belief is that — if you’re not a subscription-based product — you’re likely dead in the water these days. So a new acquisition channel like Disco, with unique audiences and first-party data, becomes extremely valuable.” 
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