231: How My Student Teri Miyahira Makes 6 Figures Selling Vegan Makeup Online

Steve: You’re listening to the My Wife Quit Her Job Podcast, the place where I bring on successful bootstrapped business owners and dig deep into what strategies they use to grow their businesses. Now, today, I have a very special guest on the show Teri Miyahira. And Teri is special because she’s a student in my Create a Profitable Online Store course. And she’s making six figures selling vegan makeup online at shop TeriMiyahiraBeauty.com. And in this episode, we’ll break down how she’s built her business from the ground up without Amazon.

But before we begin, I want to give a quick shout out to Privy who is a sponsor of the show. Privy is the tool that I use to build my email list for both my blog and my online store. Now what does Privy do? Well, Privy is an email list growth platform and they manage all of my email capture forms. And in fact, I use Privy hand-in-hand with my email marketing provider. Now, there are a bunch of companies out there that will manage your email capture forms, but I like Privy because they specialize in e-commerce.

And right now I’m using privy to display a cool wheel of fortune pop up. Basically a user gives their email for a chance to win valuable prices in our store. And customers love the gamification aspect of this. And when I implemented this form email signups increased by 131%. So bottom line, Privy allows me to turn visitors into email subscribers, which I then feed to my email provider to close the sale. So head on over to Privy.com/Steve, and try it for free. And if you decide you need some of the more advanced features, use coupon code MWQHJ For 15% off. Once again that’s P-R-I-V-Y.com/Steve.

Now, I also want to give a shout out to Klaviyo who is also a sponsor of the show. And I’m always blessed to have Klaviyo as a sponsor because they are the email marketing platform that I personally use for my e-commerce store, and I depend on them for over 30% of my revenues. Now Klaviyo is the only email platform out there that is specifically built for ecommerce stores, and here is why it is so powerful.

Klaviyo can track every single customer who has shopped in your store and exactly what they bought. So let’s say I want to send out an email to everyone who purchased a red handkerchief in the last week, easy. Let’s say I want to set up a special auto-responder sequence to my customers depending on what they purchased, piece of cake, and there is full revenue tracking on every single email sent. Now, Klaviyo is the most powerful email platform that I’ve ever used and you could try them for free at mywifequitherjob.com/K-L-A-V-I-Y-O. Once again, that’s mywifequitherjob.com/K-L-A-V-I-Y-O, now on to the show.

Intro: Welcome to the My Wife Quit Her Job Podcast. We will teach you how to create a business that suits your lifestyle, so you can spend more time with your family and focus on doing the things that you love. Here is your host, Steve Chou.

Steve: Welcome to My Wife Quit Her Job Podcast. Today I’m really happy to have Teri Mira here on the show. Now Teri is actually a student in my Create a Profitable Online Store course. And she joined quite a while back when the price was only 800 bucks. Anyways, she’s been doing amazing with her business shop TeriMiyahiraBeauty.com. And Teri Miyahira Beauty is Teri’s cosmetic line where she sells beauty products from clean and naturally derived ingredients with an unwavering policy against animal testing. And I kind of want to ask you about that in a little bit, Teri.

But what’s cool is that Teri sells a subscription box which means that she gets recurring revenue which is pretty sweet. And what’s also cool is that her company is 100% bootstrapped and does not use paid advertising either. Now how has she accomplished this? By creating a rabid fan base for her products. And today what we’re going to do is we’re going to dig deep and find out how Teri came up with her business and how she managed to get the word out about her cosmetics. And with that, welcome to the show Teri, how you doing today?

Teri: Hi, Steve. I’m doing well. How are you doing?

Steve: I’m doing good. And what’s funny about this Teri is right before this interview, I was watching your YouTube channel where you did a before and after makeup tutorial and I was like, holy son of a… I’m thinking you are demonstrating some type of foundation. I was like, whoa, makeup makes a huge difference. And as a guy I don’t normally notice, but it was magical.

Teri: It is, it’s very — you could put on your mask and then take it off at the end of the day.

Steve: It’s almost deceptive.

Teri: Yep exactly. Especially if you like to put on a lot of makeup like I do.

Steve: Well, no, it’s just that one foundation. Anyways, I’m going to post that video probably in the show notes if you don’t mind just so people can see. It sells itself actually, that one video probably sells your products. So Teri, how did you come up with the idea for your cosmetics and what makes your products different actually? There’s a lot of cosmetic lines out there.

Teri: Right. So what we do is that we are natural vegan and cruelty free. And depending on what people are looking for, you could find cruelty free, no animal testing brands very easily like at a drugstore or in your mall. But then if you want to take it one step further, you could do vegan or you can take it all the way and you could do natural. So, there’s different levels in the clean beauty market now. But for my brand, we actually hit all three points, which is actually very difficult to find in the clean beauty space.

Steve: Why is the animal cruelty part very important to you? Do you have pets or are you passionate about that?

Teri: Yes, so I do. I do have a little Yorkie and a Shih Tzu Poodle mix, those are my fur babies. So yeah, and I personally have always tried to do more cruelty free animal friendly, things like that. So I also do a vegan fashion, also donating the whole thing.

Steve: Okay. So what were some of your motivations for starting a cosmetic line? Like what were your goals for this business?

Teri: So the quick genesis story was that my day job before I had started the line long ago, about 10 years ago, I had started in print magazine and print media as a writer and journalist. And then I eventually started transitioning more into operations and business development. So my last job, “my last day job” was back in 2015 and I was doing operations and business development for a tech startup. And during that time I had started my green beauty blogging. So, I would work my day job and then at nights and weekends or early in the morning at like four in the morning, I would be recording YouTube video, so I started on YouTube.

Steve: This is before you had a product, right?

Teri: Yes.

Steve: Okay, got it.

Teri: So I started the channel about 2013 I think, it is a while ago already. And then I started the actual cosmetic line at the beginning of 2016. So, I had been blogging for a few years before I even started the line. And I chose the green beauty niche specifically because it’s always been kind of a hobby of mine even before the whole idea of green beauty and clean beauty became mainstream, because now you know how like Sephora just came out with their clean beauty section, Target is starting to transition more, CVS is starting to do the same thing with carrying more clean beauty products.

But way back about 15 years ago, none of that existed mainstream. So I was hunting down cleaning products on my own since like for a very long time. So that’s why I decided to start the YouTube channel because I couldn’t really find bloggers that were in the clean space and talking about green beauty makeup. So that’s why I started the channel.

Steve: Okay. And then I know you had a corporate background. What was this blogging, was that a means to quit your job eventually? And did you enjoy working when you were working?

Teri: Yes. Yeah. I was — actually I was really just blogging as a hobby. I really didn’t think it was going to turn into a business necessarily. I was just doing it for the fun of it, because I always consider makeup as a hobby and I still consider makeup as a hobby. So that’s why I started blogging in the first place because it was just a way for me to also justify my huge amount of makeup purchases back then. But I would be able to play with makeup, talk about makeup, blog about makeup, and I did enjoy my day job. But at the same time, I learned a lot from that day job from working in corporate and doing that kind of thing. So it ended up being a pretty nice transition when I decided to go off on my own.

Steve: Okay, and then when you decided to do a cosmetics line, I imagine that sounds pretty intimidating to me. How did you go about validating that your cosmetic line would succeed before you even started investing any money into it? Or was it kind of like a leap of faith type of thing?

Teri: It was a little bit of both. But really what was happening was — so doing all the blogging in the first part of it for a few years; I started getting a lot of brands approaching me about promoting their product to my audience. And it just got to the point where it was just almost around the clock, different brands that I didn’t even know about up to brands like Honest Beauty by Jessica Alba, for example, they had approached me about it as well. So I started thinking I can do sponsorships, which does make like a good amount of income, or I can try to start my own brand because I was promoting lipsticks, eye shadows, blushes, and things like that to my audience from all these other brands, so why not start my own and then get the margin on it, right?

So that’s where I started to — in my mind, kind of the seed was there for me to start the actual business. But it was also a leap of faith situation, too because then it was like, what if I — again, it’s like what if this doesn’t work or whatever it may be, because I had a day job as well.

Steve: But you were probably pretty confident because the stuff that you were promoting was clearly selling, otherwise brands wouldn’t be approaching you.

Teri: Exactly, because I knew that they had to have an ROI on whatever influencers or sponsorships that they were doing. So when they approached me, then they were getting some sort of ROI on their end. So that’s when I really started thinking instead of — I still do sponsorships now but instead of promoting other people’s, why don’t I try to do my own.

Steve: Yeah, that totally makes sense. So how did you actually get your blog popular or was it more YouTube?

Teri: It all started with YouTube. So YouTube is still a really good driver for us. It went from YouTube to Instagram and then Facebook and the blog and that’s kind of like the order it had went in.

Steve: So in terms of YouTube, do you have any tips for us on how you got your YouTube channel popular?

Teri: A lot of it ended up being in this sort of niche because of how the green beauty niche has still not necessarily really exploded and become mainstream yet. So that’s why back in the day there weren’t really many people on YouTube that were talking about green beauty. So I think from like a search like SEO search perspective, I think I just ended up showing up in people search results. So really kind of niching down ended up being really good in the beginning of growing the channel and all that.

Steve: Did you do any — was it like deliberate keyword research or was it just you were doing it for fun and then you just were really into the green beauty part of it and it just naturally happened?

Teri: Yes, it was definitely one of those things where it naturally happened. I wasn’t necessarily looking to create an audience in order to create a business. But it ended up being that way, which was probably the best way to have started the business in the first place.

Steve: And how long did it take for your YouTube channel to just kind of gain traction? Like how many videos did you put out until brands actually started approaching you and you built up your influence?

Teri: At one point way back in the day, I think I was at maybe about two or three videos a week, something like that. And now I’ve leveled off really to just one video a week, but sometimes it might just go on to like two weeks depending. But I think I’ve also gotten better at learning how to repurpose my content as well.

Steve: So let’s talk about that. So how does it work? You put out a YouTube video, do you use that content for your blog and do you have a podcast as well?

Teri: No, I don’t have a podcast yet. So it’s — and this is what I — when I talk to brands about their content and social strategy, this is exactly what I tell them to do is if they can start with a video, and then from there, they’re repurposing it onto their blog, they’re cutting it up into social, they’re taking stills or photos or what have you from the video and then putting that into social, all the thing about how people will do YouTube videos and then they cut the audio and then they make it into podcasts. So you could take really one piece of video content and do it multiple different ways. Like even if you’re taking thumbnail photos, for example, for the YouTube video, then you could just take extra photos during that photo shoot session in order to repurpose that on social on your blogs, etc.

Steve: So what does your process look like today when you create a piece of content? It starts with YouTube, I would imagine, right?

Teri: Yes, a lot of it starts with YouTube and now I do Instagram stories. And that’s really where a lot of my focus is right now is Instagram stories.

Steve: Interesting okay.

Teri: Yeah, just because this is probably one thing to note as well is that since the middle of last year, and with the brand not running paid traffic, there’s been, for us at least a very noticeable difference in the amount of organic traffic that we’ve been getting. So I’ve been trying to really study the algorithms, how Facebook’s throttling reach, now Instagram, and YouTube’s doing the same thing. So the organic reach is definitely different in 2018 versus 2016, 2017.

However, with that, I’ve been going more towards Instagram stories from the last few months because I noticed that the reach on Instagram stories, it still feels like it’s not being as affected by the algorithm as a regular post feed, for example, like a regular Instagram post on your feed or Facebook post on your page, right? So that’s why with Instagram stories and especially good for the introverts out there, because with Instagram stories you’re not necessarily live, so you can batch your content and create it ahead of time whether you’re recording a short video for stories or you’re taking photos and posting it to Instagram stories.

So you don’t have to do an Instagram Live or a Facebook Live or a live webinar, or something like that. You can really still take advantage of kind of a better algorithm with Instagram stories and not have to do live content.

Steve: So you have your YouTube video, how many Instagram stories can you get out of one of your typical videos?

Teri: Well, usually what I do is I won’t chop up the YouTube video for the Instagram story, but I’ll have like a camera setup and then I’ll take clips with my phone like my iPhone.

Steve: Oh okay, yeah.

Teri: So instead of my DSLR and doing it that way, it’s easier for me to still have the studio setup and then I’m taking footage and photo from my iPhone within that same setup.

Steve: Instead of using the SLR?

Teri: Yes, only out of laziness.

Steve: Okay. I was going to say; maybe it looks more natural if you’re doing it out of your phone.

Teri: It definitely does look more natural because it feels more behind the scenes. But really, it’s out of my laziness to pitch from the DSLR, chop it up in iMovie, and then take it into my phone to post it on Instagram stories. Or you could take it from your computer into Planory if you use Planory, and then from there you can upload your Instagram Stories content onto Planory which then links to your Instagram.

Steve: I’m sorry; I’m not familiar with that software. What does Planory do?

Teri: Oh, so Planory is specifically for Instagram. So, if you do Instagram regular feed posts, or you do Instagram stories, then Planory has both an app version for your phone, or a desktop version which is on their website. And it’s a scheduler for Instagram, so it could do automatic posting on Instagram, you could schedule out in advance in the future. So I do a lot, like all of my content planning really goes into Planory.

Steve: I see. Okay, and so you’re doing one of these shoots, do you just shoot all of your Instagram stories for the entire week during that one session?

Teri: Sometimes it depends. So, depending on what I’m talking about in the video, I can get a few days worth of clips, but a lot of times I’m mixing it up. So it could be a combination of what I’m shooting from my YouTube video mixed with something like what I ate that day. Or if I went to a coffee shop, then I’ll take a photo of the coffee I order, things like that just to make it a little more behind the scenes, a little more organic looking. But for the most part, I’m pre shooting at home in my little studio setup, and then uploading everything in batches.

Steve: And in terms of sales, like how do you attribute sales to like YouTube or stories, or is it just — how do you know what’s working?

Teri: So this is where my strategy gets really interesting. And then this is essentially where we grew the business because right now, we started the business in 2016 and sales to date have been almost 300,000 in sales, $300,000 in sales. And in 2017, we had about $175,000 in sales with a 60% margin. So, when people ask me like how do you do that without running paid ads, it all comes down to content, and content in the middle of your funnel. So, when I consult with brands, this is what I tell them, that me personally my strategy is running traffic to pieces of content to an offer.

And the content in this case is their social media posts, blog posts, YouTube videos, or if you’re like a podcaster it would be your podcast. So a lot of times people think that in order to run traffic besides running Facebook ads that they need to run traffic by posting a lot of posts on Instagram or posting YouTube videos in order to drive traffic to the website. But I do it a little differently in the sense of I think of all of these pieces of content as middle of the funnel, and that I’m actually driving traffic to my Instagram posts or I’m driving traffic to my YouTube videos just because of the algorithm change.

So, when Instagram, YouTube and Facebook’s been doing it for a while, when they started changing their algorithms significantly, especially like Q3 of last year, that’s when I started noticing the dip in the organic reach, and that’s when I really started to think about my strategy in the sense. So now, in terms of 2018 and moving forward, I’m primarily focused with how do we run traffic whether it is paid or organic, but two pieces of content and then from there going into an offer. But in the middle of all that, we’re building an email list.

Steve: So your offers and your content, is that on your own site, or are you driving people you mentioned directly to your social media sites?

Teri: It’s a little bit of both. So, what we could do is there’s a few different ways. And hopefully, let me know if this starts sounding confusing now that we’re talking about email as well how the funnel works. So let’s say somebody finds me on my Instagram, and you’ll also notice on my Instagram and my YouTube, I don’t really talk about the brand. I don’t really talk about the products that I sell. And that’s all part of the strategy is that what I’m trying to do is I’m trying to build loyalty first and then selling second. Whereas a lot of times with e-commerce, we’re trying to push product and trying to get sales first, and then we’re trying to create loyalty in like the middle of the funnel.

So because — I want to say because I started as an influencer, I always think of audience loyalty first. So that’s why the way that I do the strategy is that if somebody finds us on Instagram, and then they see all the content and they’re like, okay, we’re talking about green beauty, we might be talking about all these other brands, all these other products or tips and tricks and like how to apply makeup or how to create a smoky eye, right?

So we’re hooking them with the content and then we’ll start doing call to actions for sign up for the email list to grab my top 50 organic and vegan makeup shopping list. So that’s one of our lead magnets. So then from there I’m getting them from social, from YouTube on to the email list, and then from the email list is where we start selling. So we’re really selling on the back end.

Steve: I wanted to take a quick moment to tell you about a brand new service that I just launched that will help you grow your email list for free. First off, my business is called Gobrandwin.com, and it’s a service that helps e-commerce sellers build their email list through group giveaways. And in fact, in our most recent giveaway, we managed to increase the email list size of the brands who participated by 40%. That’s right, we generated over 11,000 email subscribers, and the average list size of the companies participating in the giveaway was just 25,000.

So if that makes you excited, here is how the service works. If you own your own e-commerce brand, and you have a following, you must first contribute a gift card toward your products valued at $200 or more. And this is the prize for the sweepstakes. We will assemble gift cards from other participating brands with a similar customer demographic into one gigantic sweepstakes giveaway. All participating brands will send our co branded giveaway email to their entire customer base, driving them to a special landing page on Gobrandwin.com. We will acquire email addresses and Facebook pixel data. We will also send the giveaway entry forms to related influencers in our blogger database. And between my co founder Toni and I, we have access to almost 1,000 bloggers in our database.

Consumers will enter in their email addresses; we’ll send them special offers from your company, and select a grand prize winner. And after the sweepstake is over, you will receive the entire list of entrants and instantly grow your audience. So bottom line, the concept is very simple and it is absolutely free. We will help each other promote each other’s businesses, get free promotion from bloggers, and share the email addresses. So if you’re interested in growing your email list, then head on over to Gobrandwin.com, that’s G-O-B-R-A-N-D-W-I-N.com. And once again, it is 100% free. Now back to the show.

So you’re trying to remain unbiased in terms of your content it sounds like, right? And in that email funnel, are you only promoting your own stuff or do you promote other people’s brands as well?

Teri: Correct, we’re promoting other people’s brands, promoting let’s say, the pieces of content that just released. So it could be a new YouTube video, it could even be depending on the Instagram post, we might even try getting people from the email to check out the Instagram. Or it could be a promotion. So a lot of times, what I do is I try to do the Gary Vaynerchuck jab, jab, jab thing.

So in through email, we’re typically doing about three pieces of content to one promotional offer, or it could even be five pieces of content to one promotional offer. It really depends on what the offer is, but I try to do ah three to one ratio on the email side, so that’s on the back end. And then on the front end, it’s even more so as far as it could be like a six to 10 to one offer, six to 10 pieces of content to one offer.

Steve: Right interesting. So you’re promoting everyone else’s products, including your own so people don’t think that you’re really pushing stuff to make a profit for yourself per se. Is that…

Teri: Correct yeah.

Steve: So let me ask you this question then, it seems like with this strategy, I would have named my cosmetic line not my name, right, I would have named it something else that no one would ever know.

Teri: Right.

Steve: But in this case, it’s obvious that it’s your line, right?

Teri: Right. Yeah.

Steve: Okay interesting.

Teri: Yeah, exactly. And you could do that. So in the strategy, what would have really made the most sense in that aspect was to name it something different, because then it really would have just blended in with everything else that I’m talking about too. But in this case, since what’s really the driver for — what’s been the driver since day one of the cosmetics brand is that it is tied to my name. I think that also played a factor in the initial sales for the business.

Steve: Okay, that makes sense too. So is email your primary driver then would you say?

Teri: For sales, correct yes.

Steve: Okay interesting. So it’s mainly a content play just to get people onto your list and then you do most of your selling on your list. Can we talk about your subscription box for a little bit? How does that work? Do you just try to go for the subscription in your email list or?

Teri: Yes, so once people get on to the email list, they tend to be really warm already because they’re already familiar with me, they’re familiar with the brand. They know that I promote other people’s products; I promote my own products, so they have a really good handle on what we’re all about and I’m always very educational based and information based for the content. So by the time somebody gets to the email list, there’s already that sort of trust factor that’s already gone on. So that’s where the subscription box selling really occurs is on the email list.

Steve: But don’t they have to try the product first before they’re willing to get the box or?

Teri: It kind of depends, because some people they just really like the deal that they get with a subscription just because it’s such a good deal for that many products. And it’s a month to month, so they could try it for one month and then cancel if they want to. There are some people where their first one or two orders would be for an individual product on the site except that they also realize that it’s such a big like in terms of savings for the subscription box.

That’s why a lot of people though, tend to share our subscription box first, but this is only because of people already knowing and being familiar with the brand because you know how like in recurring subscription models, a lot of times people will say, to sell it more in the middle of the funnel, like try to get a trip wire in there, try to get it like an individual purchase in there.

Steve: Yeah.

Teri: But it really depends on how by the time they see your subscription offer, how warm they are. If they’re really not warm at all, then yeah, do the tripwire, do the individual purchase, and then go into the pitch for the recurring. But if you’re leading through content that’s more educational value driven and helpful, you could go and jump to the subscription way sooner than you think.

Steve: How much of a discount are we talking about here in the box versus the individual products that come in the box?

Teri: So to get kind of a sense of what it is, let’s say for example, eyeshadow on the website could be for $25, and you can get anywhere between three to four products in a subscription box for 49 to $59.

Steve: 50% off, is that about right?

Teri: Yeah. So that’s why of course, it’s going to be a lesser margin. But then as long as you’re kind of structuring your subscription box correctly and right, then you could have a very long customer lifetime value. There are some people on our subscription where they’ve been like two years on the subscription. It’s insane.

Steve: When it’s as magical as what I saw on YouTube, I would sign up for life.

Teri: I hope yeah, exactly. And that content, right? So that’s why I lead with content. And that’s why when I consider myself an introvert, even though it obviously doesn’t seem like it because of the YouTube and everything like that, but I consider myself an introvert. My Myers Briggs personality test also says I’m an introvert, and that was all the YouTube and things like that, that was really just a skill set that I had to develop.

And that’s also the reason why I kind of structured the business and the marketing as I did, because if you don’t like feeling salesy, and if you don’t like to really push your product to people, or feel like you’re pushing your product with posting on Instagram every day about your product, or trying to push people with your Facebook posts to go to your website twice a day, or three times a day, then I’ve sort of built my model and my strategy with just my personality in mind where I want to be helpful. I want to be helpful to people, I want to show them a foundation routine; I want to show them how to create a smoky eye or how to wear red lip during the daytime.

So I want to be helpful, I want to give value, so that’s where I built this entire model around. It’s me really wanting to give value, to help people, and that’s all in the front end. And then on the back end, once they get onto the email list then I could offer, hey, by the way, I have my own vegan cosmetic company. Here is what we do, and then give them an offer that way.

Steve: So in terms of this subscription box, it’s kind of like a no brainer, right? You’re getting such a big discount. And do you still get 60% margins on the box as well?

Teri: When it goes to the box, we’re looking at more of a 30 to 40% margin.

Steve: Okay got it. And in terms of keeping them on the subscription box, is there anything special that you do?

Teri: As far as retention, not really, because we just try to give a really good value on the product, we try to create and manufacture products that are in line with the brand. Since people are already subscribing, we know that they’re very passionate about natural vegan cruelty free, so we just really try to keep in line with that as well as seasonal too for seasonal colors or seasonal textures or formulations. So the box products evolve as the year goes on. And also we launch products through the subscription box a lot of times too. So our subscribers will get first dibs on a product that might not be out yet.

Steve: I see nice.

Teri: So, we do a little bit of that and that kind of keeps the fun in the retention. But on average, our retention is typically about four to five months for the subscription.

Steve: Okay yeah that’s pretty good. And do you sell on Amazon by any chance?

Teri: No Amazon.

Steve: I’m just curious what your thought process is there, or is it just a channel that you will eventually get to?

Teri: I’m really not sure because I had actually a very long time ago before I even started this iteration of Teri Miyahira Beauty. I had one skew for skincare that was on Amazon and this was before the big gold rush of Amazon too, and I started this right when I think Ryan Daniel Moran, right when he started to really publicly talk about Amazon and his success that I learned from him. So I got onto Amazon. This was years ago. I can’t even remember how long ago.

Steve: Yeah, this is at least three years ago I want to say.

Teri: Yeah, at least. Yeah, I want to say it might have been like three or four years ago and I had one skew on Amazon. It started to gain traction on Amazon. But then I started realizing just the different quirks of Amazon, the whole thing of you can’t build your email list; you don’t have direct access to your customers. You don’t really have much control as far as like the look and feel of your page, and then it went into the whole thing of what if I want to get my customers from Amazon and show them other things on my website so the on Amazon to off Amazon. So I actually got off of Amazon before everybody went on to Amazon it felt like.

Steve: Okay, yeah.

Teri: Yeah, so I’m not on it now. I’m not sure we’re going to go on it later. So I’m really not sure, but I don’t have any plans in the near future though.

Steve: Okay. I did want to talk — some people have sometimes come to me and they want to sell some sort of beauty products. And I’m just kind of curious what the process is. Did you know how to create beauty products before you started the business?

Teri: No I didn’t know.

Steve: Okay. So can you just kind of walk me through that process? Like how do you even create beauty products?

Teri: Okay, so, because of all of my experience with the beauty blogging and being really familiar with ingredients, that’s how I started thinking about formulations on my own. And so, a big part for beauty products is really knowing the ingredients, and the ingredients that you want to work with. Because when you go and you approach for example, cosmetic chemists or manufacturers that have their own chemists, then a lot of times the chemists are going to formulate to what they think and what they’re used to. So and this is part of the reason why with the green beauty industry right now, it’s growing, but it’s also starting to get a little diluted.

And this is what I tell people, because you go to a cosmetic chemist, if they’re not used to formulating green and not many are used to formulating green in particular, they’re going to try to give you a formulation that might not be in line with your vision of the brand. So, if you don’t know ingredients, then you might not really know how to work best with the chemists. So the way that I work with chemists is that I’ll actually give them an ingredient deck and be like, hey, I want to create a lipstick with these ingredients, these 15 ingredients, what do you think?

And then they’ll come back to me and be like, actually, I’m not sure if we could do this. Can we do this other synthetic ingredient? I’ll be like, oh well, instead of that synthetic ingredient, can we go with this other natural ingredient that you might be able to source. So it ends up going back and forth. So the first thing is really if you want to get into beauty, it’s knowing the type of ingredients you want to promote from a marketing standpoint. Like if you only want vegan, you only want all natural, you only want all organic, etc. Or let’s say you don’t want any dyes, like any synthetic dyes.

And then from there, you can then work with chemists. And then it’s a back and forth, but you have to really guide the chemists in what you want. Because otherwise, they’re just going to be picking kind of either off the shelf ingredients from their R&D or you could always do your own R&D for ingredients as well. But that also gets into ingredient distributors and your supply chain becomes really complicated. So when I work with chemists, I try to work with their ingredient suppliers and what they have direct access to already. But with that comes along the whole thing of they are used to working in a certain way.

Steve: Where do you find your suppliers? Did you just Google cosmetic manufacturers, or were you already kind of familiar based on your prior profession?

Teri: Oh, it was literally all research on Google.

Steve: Okay. And then you don’t know how anything is formulated. So I would imagine in the beginning you kind of have to take what they tell you, right? Like, these are the ingredients, like you just need to include these ingredients that you want to include, but then you can leave the rest to the manufacturer, is that kind of how you proceeded?

Teri: Yes. Yeah. So I don’t tell them like hey, we need three grams of coconut derivative whatever or two grams of a plant wax. I don’t tell them one gram, three gram, la, la, la in terms of the ratios of things, I just give them a list of ingredients that are kind of like my wish list, and then ask them like hey, can you do this? Can you create the lipstick? Can you create whatever the case may be? Sometimes they’ll — a lot of times they’ll say yes, but sometimes they’ll actually say no. So in the event that they say no, you just have to try to find another chemist that can do it for you.

Steve: And how much do you have to order?

Teri: It depends on the manufacturer. So there are some manufacturers where it might be 1,000 minimum, 5,000 minimum, 10,000 minimum. But there’s also some manufacturers where you could get into an agreement with them, where in one year’s time, for example, you plan to push out 5,000 units of a lipstick skew, but your first shipment might only be for 500 of it.

Steve: How did you proceed actually with your line? What was your initial order and how much did you actually invest in your business?

Teri: So what I did was I actually pre sold.

Steve: Uh clever.

Teri: Yep. So you know how with online courses and info products, a lot of people they pre sell first in order to get the initial momentum and then from there, they take that funding and then they create the product. That’s exactly what I did for this business.

Steve: So you went and you emailed your list and you said, hey, I’m releasing this cosmetic line. And then how many did you end up pre selling?

Teri: I ended up pre selling let me say – I’m trying to remember, this is so far back. I want to say about maybe 400 units total something to that extent.

Steve: Okay. And 400 units and then so what was your first order size then?

Teri: It was literally 400 something units.

Steve: Oh, okay. And did you collect the money up front as well?

Teri: Yep. And I told them, I told my audience, this is a pre sell, we’re not shipping until so and so date, and then working it out with the manufacturers to make sure that they could deliver by that date. But that’s a really tricky way to do it, though because a lot of manufacturers especially like in my experience in the last few years, a lot of manufacturers, they just need way more time than they tell you.

Steve: Sure. But these are all in the US or no?

Teri: Yes?

Steve: Okay. Does selling cosmetics require any sort of certifications and testing?

Teri: No, because it’s like the vitamin industry, it’s unregulated in that sense. You don’t have to submit to the FDA. As long as your labels are FDA compliant in that sense, then you’re really good to go. You don’t need to be a chemist on your own. You don’t need to be like you personally as a founder. You don’t need to be certified or go to school or anything like that. I have a bachelor’s degree in communication. So yeah, I’m very far from being a cosmetic chemist right now. But yeah, that’s really what it takes to start.

I would definitely suggest for people that are looking to get into the cosmetic manufacturing business to make sure that you have enough cash flow in the beginning in order to create your units because there are MOQs for manufacturing. So you just have to make sure that you could hit your MOQ and that you could then go ahead and sell it. So that takes marketing, that takes the units putting into production, things like that.

Steve: How many skews did you start with during that initial run?

Teri: Maybe like four.

Steve: Four skews, okay. And do you remember what they were?

Teri: I want to say it was like an eyeshadow, blush, bronzer, highlighter maybe, plus powder.

Steve: I was just kind of curious how you made that decision. But I would imagine I wouldn’t understand the answer anyways.

Teri: I can tell you.

Steve: That’s okay. I am kind of curious to why you haven’t used paid ads because it seems like Facebook ads would be ideal for marketing your products.

Teri: Yes. And they will be. We started dabbling in the last few months with Facebook ads in the different iterations and all of that. So it’s coming because of how we have to definitely now just with social between Facebook, Instagram and YouTube and the algorithm changes for organic reach, we’re just not getting the organic reaches what we used to as far as driving the organic traffic. So, now is the time where if you’re a physical product seller and you’re just starting out, I would highly suggest having both the paid traffic strategy and an organic traffic strategy. So that’s why now, 2018 is my big learning how to do a lot of Facebook ads as far as my goal because that’s definitely the route that it seems like the landscape is taking.

Steve: Okay, and for all those people out there who are thinking about starting, what were some of your biggest challenges in just even getting started?

Teri: A lot of it was time, because when you’re selling physical product and you’re a solopreneur, and you’re just doing everything, you’re doing the customer service, you’re doing the fulfillment, and then in my case it was the R&D, working with manufacturers…

Steve: Are you still by yourself by the way or do you have employees now?

Teri: Oh now I have a team.

Steve: Okay.

Teri: So back then it was just me doing everything between doing all the content, and the marketing, and then the R&D, and the manufacturing, and fulfillment, and what have you. So, what was interesting though is that when people ask me, who was your first hire? Is always by myself, I don’t have a business partner; I don’t have outside investors or anything like that. So back then or even now, people would ask me, who was your first hire? My first hire was actually a 3PL.

Steve: Nice.

Teri: In order to outsource the fulfillment, because I knew that I couldn’t really outsource supply chain and manufacturing and working with chemists, and that all had to kind of come from me, right. I also could not outsource the marketing, which was the YouTube videos, the social media posts; I had to do all of that. And I still do all of that just to make sure that all the brand voice is very consistent with the messaging and the vision for the brand too.

So my first hire was the 3PL even before I hired my customer service. And the reason was because I knew that if I would have let go of the fulfillment part of it first, that would free up so much of my time and also because I just didn’t want to have to deal with packing so many orders and then taking it to the post office or to wherever. And I knew that if I could put my time from fulfillment into marketing or customer service or R&D or product development, that I would be able to move the business forward much faster if I was still just doing it on my own plus than having a 3PL partner. So the 3PL that I use is called ShipBob.

I could also give you the name for it in show notes later, but they are the 3PL that I use. I’ve been using them — I want to say I switched to them maybe in like month three or four of my business. So they handle the inventory, they handle the warehousing, and they handle the fulfillment for both the subscription box kitting as well as for the individual orders for the online shop. So they take care of the entire fulfillment process for me.

Steve: What was your criteria for shopping for 3PLs?

Teri: So the way — so here’s an interesting story on that. So because of how I was working with a lot of different brands as an influencer before I started the business, I already knew vaguely about 3PLs just from hearing it from the other founders of the brands that I work with. I mean I’m always talking shop with everybody, so even when I was an influencer and a blogger but way before I had my own business. I was just talking shop with them, like hey, what are you guys doing or whatever the case may be.

So I was already hearing about the different stories of using 3PLs, of how there’s some 3PLs where you have to have 1,000 units per skew in their warehouse even for them to consider you for the 3PL, or you have to call into the warehouse physically on your phone to tell them that you’re shipping units like that your manufacturer is shipping units to them. So I already kind of had an idea of how a 3PL worked and operate. So when I started the business, I already knew that, okay, most likely I’m going to have to outsource the fulfillment process.

By about month two or three, I started getting really tired of fulfilling myself because it was like out of my house, and I was doing it literally by myself because I don’t have any business partners. So just sitting there for hours just putting together cardboard boxes and then filling them with critical and doing all of that. So that’s why by month two or three, I was thinking in my head, okay, I need to figure out the 3PL thing. So I wrote on my To Do list, find 3PL. A week later, I still didn’t get to that part of my To Do list of course because I’m always behind on work.

And then out of the blue ShipBob, one of the ShipBob representatives just cold emailed into my customer service inbox, and was like, hey, if you’re looking for a fulfillment partner, then we’re ShipBob. And that’s literally how it happened. So I just took it as a sign from the universe. I follow James Webb more and I’m all about that whole thing. So, I took it as a sign from the universe that I just need to go with this company because of how it was on my To Do list for the last week and I couldn’t get to it.

But luckily, I looked into ShipBob and they have investor backing, they have fulfillment locations all over the country. I’m not like affiliated with them or an ambassador with them in any way um. But I’ve just been with them from that point up until now, so it’s about two years. They just launched like a competitor to Amazon Prime shipping which is a two day shipping but for e-commerce businesses that are not an Amazon.

Steve: Seller Prime you mean?

Teri: Yeah exactly. So kind of like an FBA but you don’t have to be on Amazon. So they do two day shipping now, they do split inventory so you can distribute your inventory across their different warehouses so that your customers can get the lowest price on shipping, so your zone A customers will be getting their product or will be getting the order fulfilled from a zone A warehouse for example.

So, I already knew even way back when that they were in a different like tech website articles and Chicago newspaper article, so they were already getting press as their own company. So as like a background, I was kind of looking into their company to see what they’re doing, saw that they’re really heavy into their tech and they kind of consider themselves as a tech company.

Steve: Sure.

Teri: So that’s where I knew like, hey, this is the company I want to go with because of the different stories I was hearing about working with traditional 3PLs. Because of the 3PL industry itself is very antiquated, to say the least. So you could run into situations where they could be nickel and diming you in your service contract with them. And at the end of the day, you still don’t even know how much you’re going to get charged for your warehousing and fulfillment. But with ShipBob, they make everything super simple with their pricing. It’s all inclusive.

They literally hand you a chart and be like, this is how much it is going to cost for us to ship something out to this zone for this weight and you’re done. Or like it’s $5 to just store this many units. They’re so transparent with their pricing even way back when, up until now. So that’s why I knew that the fulfillment piece was going to be something where I had to get off my plate. And I just think I got really lucky that ShipBob just kind of landed, fell from the sky, and landed on my lap at the time that I needed it. Yeah, so that was the whole story.

Steve: So I have to ask you these questions because I always get asked these from people who take my class. How much money did it take you to start this and then how long did it take you to actually get the product ready and put up your site?

Teri: So how much, well I mean, I pre sold everything.

Steve: So technically zero, right?

Teri: Technically zero. There was I guess “sweat equity” because I did have an audience beforehand, so I didn’t have to run to paid advertising just to grow a list or something like that. So if I were starting now then yeah, I would be putting money into content marketing and building a list and running the ads to build the audience, and then launching. Which I know like, I’ve heard of a lot of companies doing that now. And then what was your other question?

Steve: How long did it take you to get your first product ready and set up the site and that sort of thing?

Teri: Oh, so I set up everything through Shopify, and it took me about an hour.

Steve: Oh, wow. Okay.

Teri: Yeah, super easy. I picked Shopify because I knew it was out of the box. And I also knew that they had a very extensive app store so that if I needed all the tie ins on the back end, I’m not a coder, I’m not a web developer, I don’t know HTML, I could go on to YouTube and figure out really basic, if I needed some HTML coding, but I don’t do any of that, I’m a writer. So, especially way back then, so I didn’t know the technology. So, I was really trying to find solutions from like a tech and software standpoint that could do the job for me, and that was easy enough for me to understand.

That’s why I went with Shopify, and that’s why it took like an hour. So yeah, so it was not much time commitment, not much monetary commitment, but it was also again, it was sort of sweat equity, and building the audience organically up until that point.

Steve: And then the formulation of your product to just getting that first kit out, how long did that take?

Teri: I was talking to manufacturers maybe for a few months before that. So I want to say if I can remember correctly, I want to say about four months or so.

Steve: Okay, that’s not that bad.

Teri: It’s not bad, especially because it’s all USA based, so you don’t have the language barrier as far as if I had to do something overseas like China or anything like that there would have been the language barrier, so I think it would have been a little longer. But since it’s like one of my manufacturer is in San Diego, so I literally have gone to their facility a few times just to meet with them so it’s really simple. So if you are doing – that’s a good thing about if part of your marketing messaging is made in the USA which besides the point that you would be able to do a higher MSRP price point for being a made in the USA brand for marketing, but also when you’re sourcing, when you’re creating products with USA based manufacturers, the lead time is just cut in like a cone.

Steve: No, no, I can imagine that and no communication problems either.

Teri: Exactly.

Steve: If you were to give one piece of advice to someone who wants to start their e-commerce business, what would that be from your point of view if you were to pick one thing?

Teri: Oh, that’s a tough one. I haven’t thought about that before. I want to say if I only had to give one piece of advice, it would be…

Steve: I already know the answer. I’m surprised it’s taking you so long.

Teri: You know it.

Steve: Yeah, just start with content, right? Build an audience.

Teri: Yeah. But that’s yeah, it is. It’s start with content, build an audience. I was trying to think of what if I could take it one step further because I do it all the time. But yeah, it is content, it is the audience. But it’s also don’t feel like — don’t pressure yourself to sell. And that’s where the content piece comes in. Because I even though I run a business, even though we have these numbers, I don’t like to sell. So that’s where the content comes in. So if you’re still kind of wary and especially if you’re just starting and you kind of have that fear of selling, start with content, lead with value and then create an audience.

Even if you’re running paid traffic to your pieces of content, you’re still giving value first. And I think that if I had not been an influencer first, and if I had to feel like oh, I have to be sale, sale, sale, promotion 24/7, I kind of feel I don’t know how the business would have started back then. But I think I got lucky because of how I was an influencer first.

Steve: Absolutely. I mean selling cosmetics of all things would have been a hell of a lot harder if you didn’t have that audience behind you.

Teri: Yeah.

Steve: Because it all blends together, right?

Teri: Yeah.

Steve: I mean, at least from a male perspective until I started watching your YouTube videos in which case I became a believer. So Teri, we’ve been chatting for quite a while. I really appreciate you coming on the show. Is there — if anyone wants to find out more about your business, where can they find you?

Teri: Oh, so they could also find my shop TeriMiyahiraBeauty.com for my vegan cosmetic brand, and I also do consult with other brands from content social media marketing standpoint. So, I could also give you a link for that because I actually don’t advertise that part of my business even though it’s a completely separate aspect because I get all the inbound leads for that. And so I can give you a link to that as well.

Steve: Sure yeah, absolutely. Cool. And Teri, I’m afraid you’re going to have to take the Myers Briggs test again. I don’t believe you are an introvert.

Teri: I’ve taken it like three times.

Steve: And what I’m going to do, for everyone listening is I’m going to take one of Teri’s oldest YouTube videos from the beginning and post it in the show notes just to show you that anyone can get started on YouTube, and you don’t have to start looking as polished as Teri does today.

Teri: It’s a skill set, it’s definitely a muscle.

Steve: All right Teri. Thanks a lot for coming on the show. Really appreciate it.

Teri: Great. Thank you so much.

Steve: All right, take care.

Teri: You too.

Steve: Hope you enjoyed that episode. I just love it when a student in my course is kicking butt and you can tell by the interview that Teri is both driven and extremely competent. If any of you out there are interested in learning more about e-commerce, you can check out my full blown class at profitableonlinestore.com. For more information about this episode, go to mywifequitherjob.com/episode231.

And once again I want to thank Klaviyo for sponsoring this episode. Klaviyo is my email marketing platform of choice for e-commerce merchants and you can easily put together automated flows like an abandoned cart sequence, a post-purchase flow, a win-back campaign, basically all these sequences that will make you money on autopilot. So, head on over to Mywifequitherjob.com/ K-L-A-V-I-Y-O. Once again that’s Mywifequitherjob.com/ K-L-A-V-I-Y-O.

I also want to thank Privy for sponsoring this episode. Privy is the email capture provider that I personally use to turn visitors into email subscribers. They offer email capture, exit intent, and site targeting tools to make it super simple as well. And I like them because they’re so powerful and you can basically trigger custom pop ups for any primer that is closely tied to your e-commerce store. If you want to give it a try, it is free. So head on over to Privy.com/Steve, once again that’s P-R-I-V-Y.com/Steve.

Now, I talk about how I use all these tools on my blog, and if you’re interested in starting your own ecommerce store, head on over to mywifequitherjob.com and sign up for my free six-day mini course. Just type in your email, and I’ll send you the course right away, thanks for listening.

Outro: Thanks for listening to the My Wife Quit Her Job Podcast, where we are giving the courage people need to start their own online business. For more information, visit Steve’s blog at www.mywifequitherjob.com.