M1’s Recipe for Raving Fans: Marketing that Doesn’t Scale

Lou Friedmann is Executive Vice President of Marketing at M1 Finance, an online financial services company based in Chicago that allows you to manage your money and build wealth using an automated profile.

Read on for a transcript of his presentation from our April 16, 2019 Here’s How Startup Marketing Conference, where he tells the story of how M1 created raving fans using marketing tactics that don't scale.

Today, I'm going to give away the punch line. Today, we're going to talk about apple pie.

I think this is the first time anyone has actually given away an apple pies and slices to the crowd during a Here's How Conference. That's what we're going to do today, okay? Because I love pie.

I'm Lou Friedmann. I'm at M1. M1 is an interesting brokerage: an online brokerage in Chicago – 28 fun people – that started about three years ago.

I've been in financial services for a long time, but I've been in marketing for longer. All digital, all building brands. All start-up, all messy, right?

I've been fortunate to be part of this team that has built a product – an app – that allows you to build your own portfolio, for free: no fees, no advisory, with your long-term investment.

So, you invest with M1. There are stocks and ETFs that you put into your portfolio. It's all consumer-based. It's all US-only.

As the shirt says, you can also borrow against your portfolio, meaning you can take a loan against your assets in your portfolio.

And then this summer, in July, we're excited to announce a checking and debit account called Spend, which allows you to use a checking account with your other cash and earn two-and-a-half percent with that money that can sweep into your investment account. So you have the benefit of an account that's tied together.

It's all meant to be a product that's app-based, that allows you to engage with your long-term money differently than you would for your 401(k).

How many times a year do you go and actually check your long-term investment or your 401(k)? Maybe once a year – this time of year – when you look at your statement for taxes.

At M1, you're investing in the long term. You're designing your portfolio the way you want. We're investing every dollar.

There's fractional shares, so you don't have to worry about whole ownership. There is automated portfolio balancing in the back end. And then, in addition to that it's free, so there's no risk.

We've grown to about half a million dollars in assets – that's when you add up all the cash and the stocks and the ETFs all together, you get that amount. It's a way of sizing a firm like ours. And what's interesting is a lot of the growth has come from transfers from people like you, who have transferred from another brokerage account into M1.

That's about 200 million that we've transferred so far, and it's a gauge from a market perspective of how the health and well-being of our brand and our product, that we're delivering value.

We've grown in about 4x in the past year. In terms of portfolios that people create, you can create more than one portfolio. In fact, you can create a portfolio pie. A portfolio pie is each portfolio has multiple slices. Each slice is a stock or an ETF.

You can actually put pies within pies – we'll get into that. But a measure of how we're doing is we've created almost 300,000 of these portfolio pies for individual investors who are growing their long-term money.

We reached a milestone the past year. We reached number five in the app store (for financial services). A lot of hard work, a lot of social credibility, and a lot of marketing went into that. But frankly, I'm a pretty good worker.

You have to have a lot of thinking and a lot of really great [teamwork] going into a lot of product development to create the user experience. And ultimately the customer value that allows us to get that kind of growth in the app store, for people using it on their phone.

And like I said, I've been in fintech for a long time. Fortunate to be part of the early team, in OptionsXpress, which is now Charles Schwab.

I've learned a little bit about the model, but as all the marketers in the room know, it's not always the past experience that you bring to bear, not always the main experience you bring to bear in an opportunity like this.

A lot of it is the intuition and the decision making and fundamentally working in a chaotic environment, where you have no information. You’ve got to try a lot of things and see what works.


The situation for M1 and for how we did this tactic is everything. I look at how we complement what we're already doing.

M1 is highly, highly dependent on social media. It's interesting because  we're an unknown brand with not a lot of budget. Our whole marketing budget is a lot less than some of the people in this room. And everything we do is digital.

It's an app-based platform, and we get a lot of people who are digital-friendly, period. End of story. If you're in the United States and you're in that investment demo, Generation X is really our target.

And you're tech-friendly. We want to be in front of you and social media gives us the credibility. One of the ways that we drive people into the brand is through digital means, through social.

And that magic number is seven, right? Everyone's heard the magic number before. How many touches, how many individual reviews, Facebook pages, Reddit pages, emails, remarketing, retargeting and so on, can I put in front of you to reinforce, create viability, create trust for a totally unknown brand?


Everything we do is digital. In terms of this project, [I asked,] "Hey, how can we do something that's more physical, how can we do something that's outside the digital, or, God forbid, analog?"

We rely heavily on social, which is for defining this problem – for defining this opportunity for social – how do we create something in solving this thing or coming up with idea for the pies?

1. I looked for nexus of brand-delight-customers

How do we create something that's more visceral, something that's more physical, maybe something that's more emotional? Because that's – whether you realize or not – that's what works on all social media.

That's the stuff of social media that creates something that's shareable, gets people excited, gets people into your brand. We don't have much time for staff. I've got two people, just to put it in perspective. Not a lot of time. On any given day we're doing 10, 20 different things. And we have different campaigns running.

We had a lot of people on the team get together for once a month as a team. We talk about all these things that all the different teams are doing: the product team, the engineering team, and so on.

And one of the things we do on marketing is I tell people what we're going to do the next month – the campaigns we're doing – and I ask for feedback. I ask for ideas, and the team is really involved. I'm fortunate that way.

2. I zeroed in on crazy but doable idea.

A lot of these ideas that they give to marketing, like, you should really advertise on that billboard on the Edens Expressway. You've got to do that. Everyone sees that billboard. A lot of those ideas either go on the shelf.

Or they're just not practical, which is fine, but I'm still getting a lot of people on the team thinking about how to build the brand, how to get us out there, which I like. But there are hundreds of ideas that we've put together.

For me, I think it's responsible as a head of marketing to go and take action on some of the ideas, even if they're crazy. Even if they're crazy ideas.

Because I think people on the team want – especially all the people and all the work that they do every day – they want to feel excited about something they want to feel a part of the cause. And so, some of what we did was a little of that.

There's a marketing focus and there's putting the brand out there and reaching customers, but I really wanted to do something to get people excited. And it was an idea that the team had generated.

The team basically said, "We want to give pies to customers," so I said, "Okay, well how do we do that?"

We have this geeky connection with March 14th, which everyone knows is Pi Day. And Pi Day was invented by a math teacher, and it was in California. It was always that kind of realm, and I thought we have this symbolic connection with our portfolio pie in the slices and pie day on March 14th.

3. I simplified to fit resources, budget, time

Last year, I said, "Let's thoughtfully come up with something that's not going to be too much risk, too much money." We spent approximately $5,000, and then that would get us at least some learnings and get people excited.

And you know, all these points, that's all we're trying to do. If I lower the budget to that point, I can distribute this in this way. How do we do it in such a way that I don't take too much risk, if I spent $50,000 or $500,000 I'd feel terrible, and I wouldn't be here today, probably.

And I really, really love pie. Like really love pie. If you put an apple pie in front of me, sometimes I lose track of time and space, that kind of thing. I'm sure there's something in your life that does this to you, and you just all of sudden you get disrupted. Pie is that for me.

I get to do something I love here and tie it with Pi Day. And then here's our slices, so this might be Lyft stock and this might be the Qs ETF and so on, each of these represent, of course, your portfolio. This is what you see inside the M1 interface. And this is what we call a portfolio pie.

And then obviously tied together with pie. And then visually we put it together in one piece. This is actually the outside of the curve, so we reinforce the brand and the UI with what we're doing this day.

This card had a little personal note in it with handwriting and so on. And really, the whole thing was just generated from this idea, from this visual that you see.

We did the following: we looked at how we would go and do this in a way that we weren't thinking about anything, just reducing the amount of time and money. We looked at something where we could do something that was branded, something that I like to do as much as possible, which is surprise and delight.

Surprise and delight by it's very nature is a surprise. And something that's customer-based, at least I could say to everyone was, "Hey, we spent money on our customers in a way that was thoughtful and branded."

I wanted to do something that was doable but a little crazy or little silly and obviously something that had apple pie in it because I like apple pie.

I wish it was a little more complicated, by the way. I simplified it to fit the budget, the time, the resources. Let's be honest: it was two people and we don't have a lot of time.

I can't do nation-wide, not thinking about scaling it at this point. The whole thing is not about that. So we zeroed in on Chicago. We zeroed in on a variety of different customers in different segments. Some of the best customers who have assets at M1, who have been a customer a long time, who I want to thank.

The customers who have opened an account but haven't put money in it – that's a big potential group. It's the largest group. And who are those people in Chicago? I would rank that demo high. And then in the middle are the people who have opened an account and who have funded, but they haven't funded to our target funding.

Our target funding is about $10,000 an account. People have maybe put in $500 or $1,000, but they haven't really added onto their assets. And that's the movable middle.

If you haven't thought about that from a marketing perspective, from a startup perspective, that movable middle that's where the action is. I'm not going to make anything more of it than it is because we're talking about really small scale. We're talking about apple pies.

But how do I get a relatively expensive package? Each one was about 25 to 30 bucks. It was actually $28.25, but who's tracking?

Two of those people in the middle, the people who I don't know if they're going to be my best customers, my long-term value (LTV) customers, how about we get them a pie in Chicago, on 3/14? That's it.

By the way, studies show if you spend more money on the best customers like this – in this sort of campaign – it may not get as much energy as the ones that are moving from one step to another like I described. That's really been my focus.

4. I committed to goal, and to execute including the littles.

We simplified the goal, we simplified the resources, and we committed to doing it. The board said, "I don't know if it's worth the trouble," and so on, did all the logistics.

I said, "No, we're doing it. I love pie."

And then the most important thing is on the day of – when all this happened – a lot of things are going to get in the way. I don't care what campaign you're doing, something is going to get in the way. And for us, the commitment goal was no small thing because we had a severe thunderstorm that blocked roads in Chicago.

The pies came about 8:00 am from the bakery. They came up. They backed up the truck. I put the pies in the loading dock. Everyone on the team came down. Everyone got to participate. Everyone got to actually have a slice of pie.

It was funny. We were laughing. It was a day that everybody remembered because about 20 minutes later, the power was cut off because a lightning bolt hit a power pole behind the building and knocked out all the power. The whole building was evacuated.

All my pies had to go and leave the building. Then we had drivers come. The drivers were blocked because of fire trucks.

But then on top of that, all the power in the neighborhood went out, and then we couldn't deliver the pies in the neighborhood. So the commitment – the story I'm telling – the commitment had to be really strong.

To overcome all of this stuff – all of these acts of God that occurred that day – and then by the way everyone was going home because they had to work from home, because there was no power. Everything had to be forced, and it was way more dramatic that I ever intended it to be.

And it's just this project that we're just doing where we're just trying to deliver pies to people. This has either already happened to you or this is going to happen to you again, where things become way more dramatic than they need to.

5. I followed up. Silence gets the grease.

The most important thing is, the day before we let people know that there was a surprise coming, the day of, we let people know that there was a surprise waiting for them and the day after we asked for them for feedback. And that's what really is important at that point.

6. I tracked, reported, debriefed.

We got about 50 percent of the people we reached. We tracked it. We tried to report it. We briefed it, but we kept the expectations low. They got a pie with our logo in the top of the pie. See the M, in the pie? Right there. No one got that there was a logo on top of the pie.

On the one hand, this is showing you my attention to detail: find a bakery that can put our logo on top of the pie. The team was so excited and they were taking pictures.

But unless I'm sitting there at their door where we delivered the pie, explaining to them that the logo was in the pie – and I put it in a note too – nobody really got it.

And I know that because some of these influencers that we sent the pie to – because by the way, that was part of the plan I gave it to influencers in Chicago, fashion influencers, everybody that I could – when they took a picture of the pie, the M was upside down, or to the side. We said, "They probably don't know that the logo's at the top."

And then there was this nice card. We spent a lot of money on each individual package to make it consistent with the brand and design. Because it looks great. It feels great.

This is the message that I want to send. Even if we've never scaled this nationwide. We delivered 250 pies despite all the drama that I told you.

Imagine how many people were not there because they're on vacation. There was a whole argument with the person – the door man – because they wouldn't accept the pie. Or what do we do with this when it comes back and all this time was wasted?

We did go to influencers. We did go to media. I sent it to all the first responders in the neighborhood to thank them for the service. All the firemen that came that day to put out the electrical fire, we gave them a pie. It was wet but it was good.

And then I gave it to people like my best friend in the whole world (WXRT radio DJ Lin Bremer), so I sent him a pie. People like that, to try to get a little more social, a little more. It's a PR stunt. Let's face it.

All day long, we were posting our own social media, our own videos, and our video of us delivering the pies. And, hey, when all the pies were done, we took a picture like, "Oh all the done. All the work is done." Lot of great visual, a lot of pictures.


We got about 10,000 views. Our video is a top tweet for our social platforms for the year, so far. We got about 250,000 impressions. About 50 percent of the people we sent the pie to responded.

Who knows what happened to the other 50 percent? Unless they take a picture and send it to you, how do you verify that they got the pie? You can't really do that, unless you FedEx them. I wasn't going to do that because they might get stale.

The CEO got 25 unbelievable emails. Someone tell me how to put a value on that? There was a definite long-term, goodwill brand value to that. That did get shared. That got up to the board.

That's all part of the consideration of that, but overall, it's a moderate success or low success. I would say moderate because I didn't spend a lot of money. I didn't spend a lot of resources and I didn't spend a lot of time.

It's a lot of impact. We got a lot of goodwill. We got decent social media. I don't want to tell you that those numbers are 250,000 individuals. I don't think the social media platforms can tell you that, in terms of unique. I also think that if you go and try to measure this too far, something that's analog doesn't scale very well.

I think you're going to get yourself into a rabbit hole. Just go for the broader theme here, the broader impact. Are we going to do it again? Could I do this nationwide? Maybe. I gotta figure out the drivers.

By the way, there's a great start-up idea here to have a just-in-time driver / driver job site. I know that a number of people in Chicago tried something like this before. All of the drivers that I had put together to deliver the pies that week – the week before – all cancelled the night before. All cancelled.

I posted an emergency message on Craigslist at midnight, on March 14th, saying, "Who can be here at 8:00 am? And who has a car, who can deliver these pies?"

And I got 50 responses. I gave them the directions, and they were all pretty much professional people. Some of them were Lyft drivers.

Some of them were just people who needed a job. Some of them had their families in the car.

And then, they came. We got them all out the door. And by the way, some of the drivers were unbelievable and delivered 50 pies. Some of the drivers delivered five.

What was interesting is the next day and the week after, they all called me again, "When is the next job? When is the next Pi Day?"

So, I thought someone in this room could create an app for these people and help them out. There's all these potential ideas. I said, "Sorry man, it's just one day a year."

Final takeaway: We did create something that's fun that we could do next year. I don't want to belittle the fact that the team is really excited about stuff like this, and it's an opportunity for later.

I invite everyone to grab a piece of pie at the table, our Scafuri Bakery on the Southside are the people that made it. It's been family-owned for 100 years. I brought it for you to enjoy.

Appreciate your time. Reach out to me any time you want. I'm always really ready to help anyone with their startup, and thanks for listening.