00:29
Postscript is my SMS or text messaging provider that I use for ecommerce and it’s crushing it for me. I never thought that people would want marketing text messages, but it works. In fact, my tiny SMS list is performing on par with my email list, which is easily 10x bigger. Anyway, Postscript specializes in text message marketing for ecommerce and you can segment your audience just like email. It’s an inexpensive solution, converts like crazy, and you can try it for free over at postscript.io slash Steve. That’s P-O-S-T-S-U-I-P-T dot I-O slash Steve.

00:59
I also want to thank Klaviyo for sponsoring this episode. Always excited to talk about Klaviyo because they’re the email marketing platform that I use for my ecommerce store and it depended on them for over 30 % of my revenue. Now you’re probably wondering why Klaviyo and not another provider. Well, Klaviyo is the only email platform out there that is specifically built for ecommerce stores. Klaviyo can track every single customer who is shopping 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.

01:27
Let’s say want to set up a special autoresponder sequence to my customers depending on what they bought, piece of cake, and there’s full revenue tracking on every email sent. Klaviyo is the most powerful email platform that I’ve ever used, and you can try them for free over at klaviyo.com slash my wife. That’s K-L-A-V-I-Y-O dot com slash my wife. And then finally, I wanted to mention my other podcasts that I released with my partner Tony, and unlike this one where I interview successful entrepreneurs in e-commerce,

01:53
The Profitable Audience Podcast covers all things related to content creation and building an audience. No topic is off the table and we tell it like how it is in a raw and entertaining way. So be sure to check out the Profitable Audience Podcast on your favorite podcast app. Now onto the show.

02:14
Welcome to the MyWifeCouterJob podcast. Now it’s been a while since I’ve given an update about Bumble Bee Linens, which is my e-commerce store. So I thought that I’d dedicate some time today to tell you what’s been going on over in handkerchief land. Now, first off, from an operation standpoint, Bumble Bee Linens is kind of at a crossroads right now. Living in the Bay Area of California, the labor costs are at an all time high. In addition, rents over here for office space have been skyrocketing like crazy.

02:44
Now our lease runs out in January of 2023. And just to give you an idea, our rent is set to go up nearly 28 % from when we signed our last lease. 28%. That’s ridiculous, right? Not to mention that our current landlords are easily the worst landlords that we’ve ever had ever. Whenever anything is broken, they do not respond. They do not pay for anything and they don’t really care about their tenants at all.

03:13
And I just have to say this, I California is one of the worst places to start a business. Now, if my kids weren’t in school here, and if the weather wasn’t so darn good, and if we didn’t have friends here, we would probably be out of here from a business perspective. And in fact, my wife, I don’t know if I mentioned this on the pod before, but we actually looked into moving to Texas, Washington, and Las Vegas for this exact reason. And don’t get me started on California taxes and laws. Right now, we are actually looking to purchase an office building

03:42
so that we’re no longer dependent on anyone else for rent ever again. Now, first off, before I continue, I just wanna give a quick shout out to Mike Jackness for what I’m about to tell you. And this conversation, it was a casual conversation that I had with Mike since we’re speaking together at the Sell and Scale Summit next month. But what Mike told me could save me hundreds of thousands of dollars in the coming years. So Mike, if you are listening to this, I owe you one, buddy. All right, so here’s what Mike told me.

04:11
Lots of e-commerce store owners are buying their own warehouses right now because of a tax benefit called the Opportunity Zone Program. By the way, before I go on, I just want to say that I’m not a tax professional, so make sure that you do your own research before you take what I tell you today as gospel. Not a tax professional. Anyway, okay, back to the Opportunity Zone Program. The Opportunity Zone Program is a government program that allows people to invest in distressed areas in the U.S. with a huge tax break.

04:40
Now in our case, the office building that we’re looking at is on the fringe of an opportunity zone. I guess the definition of a distressed area is kind of up for debate and it probably just changes depending on where you’re located. this location isn’t bad at all. We scoped out the property, looks pretty good. Meanwhile, you get the following tax benefits. All right, so listen up here because I often get asked this question, like how to avoid paying taxes. This is one way to do that. When you…

05:08
buy a property in an opportunity zone, you can actually defer your taxable income from any gains that you make from your investment. So I’m just going to kind of enumerate these first and I’ll give you some examples. You get a step up in basis for any capital gains invested into your opportunity zone building. And then your basis increased by 10 % if you hold it for five years and an additional 5 % if you hold it for seven years. And again, I’ll explain this all with a full example in just a second.

05:37
But basically you can exclude up to 15 % of your gains if you hold onto the property for seven years. And here’s the best part, it gets better. The best part is that you get a permanent tax exclusion of your gains if you hold your property for 10 years. Basically you don’t need to pay any capital gains tax on the property appreciation if you hold it for 10 years, which is crazy. All right, so if you guys didn’t follow me.

06:05
This might be confusing and admittedly I actually had to read over the rules many times before I could understand it. So what I’m gonna do now is I’m gonna explain the tax benefits with an example and I’ll go slowly because once again, it took me a while to get it. And by the way, before I go on, you don’t actually need to buy a building in an opportunity zone to get this tax benefit. There’s actually opportunity funds out there that you can invest in as well. let’s wrap this up with an example here. Let’s say that you make $100 and

06:34
profit from your business, stocks, or whatever. You make some gain that’s 100 bucks. Now if you invest that $100 into your opportunity zoned building, you can actually defer paying tax on that money. Now if you hold that investment for 10 years, your basis is increased by 15%, which effectively reduces your taxable gains to $85 instead of 100. Basically you get a 15 % off of your tax basis.

07:03
Now let’s just throw some numbers in the mix here. I know I probably shouldn’t be doing podcast math, but I’m going to try to do it here so you guys can follow. Let’s say you buy this property and it appreciates $100 in the 10 years that you own it. Well, if you decide to sell after 10 years, you will pay zero taxes on the appreciation. So essentially investing in an opportunity zone property will save you 15 % on your taxes.

07:31
and you’ll pay no taxes on any gains that your property will make in 10 years. This is pretty amazing. So if any of you guys are looking or even considering buying your own office building, consider looking for an opportunity zone as long as you’re in the U.S. All these things obviously apply just to the U.S.

07:51
Okay, so anyway, Jen and I put out an offer for an opportunity zone building and I hope it goes through. We haven’t heard back yet because you can never tell with the Bay Area. I think like three months ago, my wife and I, put a bid for an office building. It was a not a small building. It was 4000 square feet. We’re talking seven figures here. And we put a competitive offer in and then the winning bid ended up going for 10 % over the asking price.

08:20
And it was an all cash offer, no contingencies as is. Now this is normal for residential property, but for an office property, this is actually pretty unusual. Anyway, I’ll let you guys know in an update, maybe in a subsequent podcast, whether we get this building or not, but I hope so. All right, so what else is going on here? A couple of months ago, my wife and my daughter went on a mother daughter trip to South Korea and

08:47
It’s rare for us to not travel together, but it was a great trip and they really bonded on that trip. I’m not going to talk about the trip. While my wife was gone without me, I actually started going into the Bumble Bee Linens office every single day. And normally I don’t go in because my wife handles operations and I handle marketing. Incidentally, if you’re working together with your wife, that’s actually the best way to stay married. If you guys kind of overlap in your business duties, you’ll probably start to fight and whatnot. Anyway, so I largely stay away from the

09:17
because operations is his domain. And here’s what I have to say about that. Sometimes when you’ve been doing things the exact same way for a long time, it becomes a norm, and it’s tough to make any changes to like the standard protocol that you’ve established. And this is often why businesses hire outside consultants to make a business more efficient. When you’re in the business day to day, it can be hard to see things from 50,000 feet. Anyway,

09:46
When I went into work that week, I actually took the time to fix some of the inefficiencies that I saw. And first off, before I go on with what these were, I just want to say this is probably largely my fault. Whenever my wife asks me to do something, especially when it comes to tech and coding, I’ll often respond with, all right, so what’s the priority of the change? Here is what’s on my plate right now. How urgent is this? And with anything that is process related,

10:15
it’s really easy to put things on the back burner. Like let’s say my wife wants a way to do something a little bit more efficient, but it’s not like a fire that needs to be put out right away, right? It’s really easy to put that stuff on the back burner. I actually have a term for this. I call it business debt. So for example, I’m actually sitting on lots of code for Bumblebee linens that works okay, but it’s ugly. Now in the interest of just getting something working,

10:43
I took a couple of shortcuts and wrote code that I would probably be ashamed to show any other programmer. Now, if you’re a coder, you probably know what I mean. When I was at my full-time job, sometimes I would agonize over tweaking my code to provide the most efficient and elegant solution out there, right? It was more than just getting to work. It had to be maintainable. It had to work elegantly and had to be fast. But in business, sometimes I don’t have time for that.

11:09
Sure, you might plan on fixing things at some later point, which never ever comes, and this is what I call engineering debt. Now with business processes, it’s actually not that different. When you don’t get that many orders early on, and some of you guys who are listening to this, maybe you don’t get that many orders right now, it’s okay to be inefficient, pack stuff and ship it by hand. It’s okay not to automate in the beginning because it’s probably not that painful yet, right? But.

11:34
At some point, you’ll probably need to make things more efficient to free up your mind and your time to do other things. Anyway, so while my wife was out, I thought that I would surprise her by automating a lot of things that she may or may not have asked for. And even though I hang on that woman’s every word, sometimes I may not have heard her correctly. So here’s what I did while she was gone. And some of you guys listening to this might think this is a major risk, but I think I was pretty considerate with what I changed and, you know.

12:04
what things need to change. I just want to say this, with our business, it’s a little different than a traditional e-comm because we do personalization and we’re in the wedding industry. One of our biggest problems is prioritizing orders that go out. So for example, we might get a series of orders with different shipping rates. Some of these orders might require personalization, which takes up to five business days. Some people might have special deadlines. And so,

12:31
it can be difficult to prioritize which orders need to be processed first and which orders absolutely need to go out like today, the present day. Sometimes people have special comments that need to be processed and taken into consideration. And so I put together a dashboard that just basically puts all the rules for prioritization into code. Basically, here’s a list of orders that must go out today. Here’s a list of orders that must be stitched today.

13:00
Here’s a list of orders with special comments that need to be processed early. Here’s a list of orders that need to be combined. Sometimes people place orders, multiple orders in like the same day, or maybe like the next day kind of spaced apart and you need to combine those orders so that people can save on shipping. Anyway, here’s what I come to realize after running this e-commerce business for 15 years now. People are careless. Lots of people just type in their address wrong.

13:28
Some people make spelling errors on personalization. I’ve had people spell their names wrong, you know, on personalization. We make sure that they double to have them double check their personalization before entering the order through, but still mistakes happen. And when this does happen, you can’t process anything unless you hear from them. Right. So what do do with these orders? Sometimes you’ll reach out to these people and you won’t hear from them. And then these orders are in limbo. Right. And

13:57
You know, sometimes you forget to email them again if they haven’t responded. Sometimes you forget to call them. So this is what I put into the code. Now the website automatically emails people on a regular basis with a cron job for people who are technical and listening to this to remind them that they need to respond. So basically it takes the burden away from a human and puts it on a machine. The dashboard also indicates when the customer needs to be called again. Let’s say you send out two emails with no response then

14:26
that that order will be annotated with, please call this person over the phone. I also took the time to revamp our inventory system. Our business is different than a lot of other e-commerce businesses because we do personalization. And inventory can be a bit of a mess the way we currently have things set up. Like if I were to start all over, we probably wouldn’t have done things this way, but let me just tell you what our inventory issue is. Basically, when someone chooses a personalized handkerchief,

14:53
they can actually choose from a variety of hankies when they want to monogram it. Okay, but we also sell these hankies in sets of three that are blank. And in the past, there was no real automated way to reconcile inventory from the personalized side from these sets of three easily. And also, I think anyone who runs like a, certainly in a textile business, we often encounter irregular or defective merchandise that isn’t necessarily reflected in the inventory count. So let’s say,

15:23
you pull something and you it might have like a run in the fabric or a mark on it it’s unsellable but you need a way to account for that in the inventory.

15:34
If you sell on Amazon or run any online business for that matter, the most important aspect of your long-term success will be your brand. And this is why I work with Steven Weigler and his team from Emerge Council to protect my brand over at Bumblebee Linens. Now what’s unique about Emerge Council is that Steve focuses his legal practice on e-commerce and provides strategic and legal representation to entrepreneurs to protect their IP. So for example, if you’ve ever been ripped off or knocked off on Amazon, then Steve can help you fight back and protect yourself.

16:02
Now, first and foremost, protecting our IP starts with a solid trademark and Emerge Council provides attorney-advised strategic trademark prosecution, both in the United States and abroad for a very low price. And furthermore, the students in my course have used Steve for copyrighting their designs, policing against counterfeits and knockoffs, agreements with co-founders and employees, website and social media policies, privacy policies, vendor agreements, brand registry, you name it. So if you need IP protection services, go to EmergeCouncil.com and get a free consult.

16:32
And if you tell Steve that I sent you, you’ll get a $100 discount. That’s E-M-E-R-G-E-C-O-U-N-S-E-L dot com. Now back to the show.

16:42
Anyway, so the upshot is I coded up a special inventory system for our store alone. And I don’t want to bore you with all the details, but the key takeaway here is that every now and then you got to step aside and fix some of the inefficiencies with your business. Your business, if you’ve been running it for a while, probably has a lot of process debt. And it’s actually going to make a huge difference and clear your head if you just fix some of these changes.

17:09
Here are couple of miscellaneous things that I’ve implemented with Bumblebee Linens, moving much of the Google ad spend over to Google Performance Max. Now, if you don’t know what Performance Max is, it’s Google’s latest advertising platform that is meant to take your advertising burden off of you. So basically it’s a black box. You feed a product some copy and it does the rest through machine learning. Now, personally, I hate using anything that is fully automated, like if I’m paying money for it, because I’m an engineer.

17:38
Performance max provides very little visibility in what Google is doing But I’ve been running it for several months now, and it’s actually doing quite well So I’m gonna let it slide, but I’m cautiously optimistic and I’m a pretty skeptical guy at heart. So for example Let’s say Google is about to miss earnings on Wall Street What is stopping them from like dialing down the conversions from this invisible black box of an advert advertising platform just to make a little bit of money?

18:07
and meet earnings. Google literally gives you no metrics or data, and so you wouldn’t be able to prove a thing. And this is the biggest problem that I have with Google AI taking over the world. Google basically tells you nothing about your ads except for your return on ad spend. And it’s great for the clueless user, but it’s really bad for people who know what they’re doing. So perhaps someday, I’ll just make a prediction here, Google and Facebook will probably have such good AI that it’s going to put advertising agencies out of business. Who knows?

18:37
Anyway, the other thing I’ve been working on is Google basically forced me to move all my Google campaigns over to Performance Max, which actually inadvertently forced me to optimize my Google shopping feed. Now, I’d actually put off optimizing my feed. So let me just tell you what this feed is. Basically, in order for Google to display your ads and the search results, you have to upload this document called a feed that outlines all of your products, images, copy, and that sort of thing. And the right way to do this, like most tools, if you’re using a shopping cart, will create this for you.

19:07
but it’s very inefficient. And in order to get more traffic and sales, you actually have to optimize your feed. I’ll talk about what that is in just a sec, but I’ve been putting this off for the longest time because it is a pain in the butt to rewrite custom keyword stuff titles for your feed. And literally you have to go into every product and rewrite it, do keyword research and figure out what people are searching for and stuff that in the title instead of the regular title for your product. And we have like 500 SKUs. And so it’s the most tedious work ever.

19:37
But basically I bit the bullet and optimized it while I was sick with COVID on vacation with my family. Not sure if I told you guys about that, but in May, I went to my conference cellar summit in Florida, shook hands with everyone, gave people hugs, went massless, and I didn’t get COVID. But then I go to Orlando with my family. I’m super careful. I wear masks outdoors and indoors, and then I get the stupid disease. Anyway, I was actually the only one in my family who got COVID on the trip, so I actually stayed isolated back at the hotel.

20:06
and I literally had nothing to do but work on the business, so I bit the bullet. And I optimized all the listings for Google Shopping. I literally had nothing to do for four days, so that’s what I did. This year, I’ve also focused a lot of my efforts on SEO. After getting hit with a Google algorithm update in 2020, where I lost almost 50 % of my traffic, I decided to bite the bullet and go all in on SEO. And today, I’m happy to report.

20:34
that Bumblebee Linens is at the highest organic traffic rate that it’s ever been. From the lows in 2021, traffic is up over 5x. Now, if I could just solve some of my inventory issues, I could actually see some of the gains from my SEO. But overall, terms of inventory, it’s been a challenging year for our shop. We survived 2020 and 2021 with almost no issues in inventory, but 2020 actually has been pretty hard for us. Now, I don’t want to ramble too long here.

21:04
since a lot of you guys probably are not that interested in my business. So let’s just end with some key takeaways, shall we? Okay, takeaway number one, with real estate prices getting lower and rents skyrocketing, might make sense for you to get your own building. So do a search for opportunity zones in your area so you can see if you can get a killer tax break. Takeaway number two, revisit your business debt. If there are processes that you have in place that are super manual or error prone, it’s time to revisit them.

21:33
Do not wait too long because it’s going to come back and bite you in the end. Takeaway number three, have someone who is not involved in the day-to-day of your business just kind of look over your shoulder and point out ways that you could do things more efficiently. And then takeaway number four, isolate yourself in a hotel room for four days and you’ll be amazed at how much work gets done. Okay, quick update on the property. It is now three days later after the initial recording of this episode.

22:02
And where we left off, we had put down a bid that was slightly under asking and we were waiting for the owner to get back to us. Now this property has been on the market for 31 days at this point and we were pretty confident that our bid would win. But over the weekend, the owner of the property miraculously got two new offers. Now one was a lowball offer, which the owner ignored, but the other offer came in from overseas for all cash at the asking price, which was higher than our bid.

22:30
Yeah, so not only was this bit higher than ours, but it was all cash. However, the buyer was not in the US, had never seen the property at all. And I guess in the minds of the seller, there was a greater chance the deal would fall through. So at this point, Jen and I had to decide how badly we wanted the property. And after, you know, thinking about it for, I don’t know, I’d say half a day, we ultimately decided to raise our bid to asking. And then we went with all cash. Now,

22:59
This was a very nerve-racking decision, but we are now the proud new owners of an Opportunity Zone property. Hope you enjoyed that episode. Now that we have the property, we have to do the part that is not so fun, which is the paperwork to get all this going, and I’ll keep you posted on how much of a pain it is to get this all set up. For more information about this episode, go to mywagputterjob.com slash episode 420. And once again, I want to thank Clavio, which is my email marketing platform of choice for e-commerce merchants.

23:28
You can easily put together automated flows like an abandoned card 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 mywifequitterjob.com slash KLAVIO. Once again, that’s mywifequitterjob.com slash KLAVIO. I also want to thank Postscript, which is my SMS marketing platform of choice for e-commerce. With a few clicks of a button, you can easily segment and send targeted text messages to your client base. SMS is the next big own marketing platform.

23:56
and you can sign up for free over at postscript.io slash div. That’s P-O-S-T-S-E-I-P-T dot I-O slash div. Now we talk about how I these tools in my blog and if you are interested in starting your own eCommerce store, head on over to mywebquaterjob.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.

00:27
But before we begin, want to thank Klaviyo for sponsoring this episode. Always excited to talk about Klaviyo because they’re the email marketing platform that I personally use for my e-commerce store and it depends on them for over 30 % of my revenue. Now you’re probably wondering why Klaviyo and not another provider. Well Klaviyo is the only email platform out there that is specifically built for e-commerce stores and here’s why it’s 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.

00:55
Let’s say I want to set up a special autoresponder sequence to my customers depending on what they bought piece of cake and there’s full revenue tracking on every email sent. Klaviyo is the most powerful email platform that I’ve ever used and you can try them for free over at klaviyo.com slash my wife. That’s K-L-A-V-I-Y-O dot com slash my wife. I also want to thank Postscript for sponsoring this episode. If you’re in the e-commerce business of any kind, you know how important it is to own your own customer contact list. This is why I focus a significant amount of my efforts on SMS marketing.

01:25
SMS or text message marketing is already a top five revenue source for my ecommerce store and I couldn’t have done it without Postscript which is my text message provider. Now why did I choose Postscript? It’s because they specialize in ecommerce and ecommerce is their primary focus. Not only is the tool easy to use but you can quickly segment your audience based on your exact sales data and implement automated flows like an abandoned cart at the push of a button. Not only that but it’s priceable too and SMS is the perfect way to engage with your customers.

01:54
So head on over to postscript.io slash Steve and try it for free. That’s P O S T S E R I P T dot I O slash Steve. And then finally, I wanted to mention my other podcast that I released with my partner, Tony. And unlike this one where I interviewed successful entrepreneurs in e-commerce, the profitable audience podcast covers all things related to content creation and building an audience. No topic is off the table and we tell like how it is in a raw and entertaining way. So be sure to check out the profitable audience podcast on your favorite podcast app.

02:24
Now onto the show.

02:31
Welcome to the My Wife, Quarter Job podcast. Today I’m thrilled to have Spencer Jan on the show. Now, Spencer is the founder of Solo Stove, which is a company that he and his brother started and bootstrapped to a $2 billion valuation and multiple eight figure exits. Now Spencer and I, recently met at the e-commerce fuel conference in Norfolk and I’m really glad that we did. He’s got a crazy story and today we’re going to break down and dissect his path to success and

03:00
Just a quick warning to the listeners, the man is probably one of the most modest people that I’ve met. Let me give you an example. At Ecommerce Fuel, he gave an amazing keynote speech. And even though he claims to have never spoken publicly before, I called BS because it was such an amazing speech. Anyway, he’s probably gonna downplay a lot of his accomplishments. So take everything that he says with a grain of salt. He’s an amazing guy. And with that, welcome to the show, Spencer. How you doing? Good.

03:28
Good to be here, Steve. was thinking today too, that like, it feels like being on your podcast out of all of them is like the rite of passage sort of like, you you haven’t finished your journey unless you end up on your path. So I was excited. I was like, yeah, this is awesome. Cause we’ve listened, I say we, me and my brother, right, started our company, but I’ve listened to your podcast for years, like years. And

03:57
I think it’s less about you to be honest. It’s more about like the guts you have on, right? But your story was amazing too, because we started when 2008 blogging. What year did you start doing your blog? Blogging? 2009. Yeah. So we were in that kind of like looking for inspiration and education before you even started. So we saw you pop up because I remember showing, I was like, what a weird title, but it resonated with us because we knew kind of what you were getting at with that.

04:28
But we started like the days of Pat Flynn and Smart Passive Income and him putting out his monthly earnings reports. Remember those? And those were so fascinating to just to see like somebody’s willing to share this stuff. So all of it was so super helpful through the years. So I guess I have to say thanks to you like first off because like, appreciate it. I mean, you know, it’s funny just to the listeners out there.

04:57
Spencer and I, were exchanging emails and then I noticed that your email was already in my inbox and I was so embarrassed. And then, cause you’re like, oh yeah, so you didn’t respond to my email, did you, Stephen? So from here on out, I’m never gonna forget your email ever Yeah, well I was even a little bit embarrassed because I was, you as you’re asking for my emails, I didn’t want to say like, well, I kind of reached out just not too long ago. Not sure if you saw that. So I didn’t.

05:23
I didn’t say it because I was like, oh, whatever. I’m sure he has a VA. Going through his emails, it fell through the cracks or whatever. Because I was like, oh, what’s interesting is as it kind of went on my journey, this is kind of leaping all around, but when the company eventually went public, that kind of freed me up to be able to talk a little bit openly about it. Up until then, I was like, couldn’t really talk much about it. Or I didn’t know where that line was of what I could and couldn’t say.

05:52
But now that there’s a lot of public information, it makes it easier to. And so that’s when I reached out to Andrew first and foremost, because my brother went on his podcast, like in 2014 as like this, I think the title was like, stealth entrepreneur, you know, and he was like working a day job and he didn’t don’t divulge a whole lot. And he was kind of like the secret, you know, I’m doing the side hustle thing. And so he went on that and I was like, oh, I need to kind of come full circle with Andrew. But then my my second thought was like, I reached out to

06:21
your podcast as well. But it fell through the cracks. That’s okay. We’re here. Well, here we are, Steve. That’s what matters. Yeah. So Spencer, I know that solo stove was not your first venture. I just curious how you got into e-commerce in the first place. Yeah. And that’s, yeah, I shared a lot about that at the ECF conference and it is something that a lot of people don’t know because it’s easy to just jump to the headline story and the big numbers that make it make it sound like

06:51
It was a straight shot to the finish line. But it was far from that. I started in 2008 blogging. Found this. What was the blog? The blog was called China Business Traveler. And you could probably find it go on the way back machine and it all had hyphens between it. So it was China hyphen business hyphen traveler. And I think I it. This is going to make me sound so bad. I spelled traveler like the British way because the other way was like taken. This is I had like two L’s or something. I was like

07:21
does it have one L or does it have two L’s? I eventually, and so I think I spelt it the way, I don’t even know if this is right, but to this day I’m like, I think I spelt traveler like wrong. But I did that for like a year through this course that it was a course, it was called SBI, it was called Site Build It. I know that company. Yes. Is that still around? It still is. I think it transitioned to something else called, I can’t remember what it transitioned to, where it is more e-commerce focused.

07:51
But site build, had a lot of blogs back in the day. Like a lot of people were using it and it was a legit kind of slow and steady learn SEO, you know, learn all the keyword research stuff. And so we started, I started blogging in Oh wait, thinking that was a way to kind of supplement my income and did it for a year. Didn’t make any money. I mean, we’re talking less than a hundred dollars of which most of it didn’t get paid out. Cause I had like one affiliate sale for like a plane ticket, but it wasn’t high enough to like reach the pay.

08:21
payout threshold. And so I never even got the money. But I figured blogging wasn’t for me because I hated writing eventually. And then I was working in China at the time for a sourcing company. And we were sourcing all sorts of products for other people, mostly larger companies, not e-commerce sellers. It wasn’t a big thing back in 08. And one of the projects was memory foam mattresses for a retail store in the Pacific Northwest.

08:52
It was called King’s mattress and oh wait hit and there they didn’t pay us for the containers that shipped to them and it just was a mess. And I had spent all this time figuring out how to make mattresses. And so I was like, Oh, I’ll just, I’ll just maybe sell these, uh, is, kind of the, the short story of it. And so I started selling memory foam mattresses to other expats that were living and working in Shanghai. So we’re talking like Americans, Europeans, guys from Canada and Australia.

09:22
And I would, so I use my blogging skills to create essentially a blog that had like a buy button and it wasn’t a real buy button. It was a form builder button or it was called for mail. And so you would click it and then it would go to a form and then they would fill out what they wanted to order. And then it would shoot me an email and that’s how I started. So I use my, I created what was a blog and then started selling these memory foam mattresses. Yeah. So that was my first foray into, into e-commerce, but then it,

09:51
It grew into a whole bunch of other brands. tried a ton of different things, started selling on Amazon, on eBay, doing all of that and kind of through the years, um, did a lot of different brands. I’d probably say 10 or 12 different brands with hundreds of skews. And so try it. crazy. And you were able to do this because of your background, you were living over there or yeah, because I was sourcing over there. had a partner for some of these brands. was, I partnered up.

10:19
The company I was working for eventually kind of earned some equity in that company and so kind of became partners with this guy who had the sourcing company and we were sourcing all sorts of different products. So I kind of got him on this, got him interested enough and saying like, look, I’m playing around with e-commerce. I think it’s like the way to go. We can go direct to the consumer. We don’t have to sell to these big guys anymore and kind of have this 80-20 rule like

10:48
one or two companies make up all your revenue and it’s always a scary position to be in. And so we started taking some of these things that we had access to, or we had found suppliers or we went out and found new suppliers and we started playing the Amazon game. Um, and I think back then, year was this by the way, Amazon was probably 2009. Yeah. 2009, it was so early. It was so easy. It was scary. Easy. We got introduced to selling on Amazon by another guy.

11:18
a friend of a friend and he basically said, I’ll teach you guys. And I think he charged us like $15,000, like me and my other business partner in China to teach us how to sell on Amazon. And we’re like, okay, that sounds like a lot, but so-and-so says you’re reputable and we did it. And he really just had a few phone calls with us telling us, what you got to do is look up keywords.

11:44
find a keyword and put it in your title, put it in your description, put it everywhere. And that was it. Like that was his whole spiel. I’m like, that’s it. But really back in those days, that’s all you had to do. It was like, if you had keywords in your titles, you just shoot up to the top. Was FBA even around back then? Yeah, it barely started. Okay, I take it back. I don’t know. I don’t know when FBA started. I can’t remember if we transitioned into FBA, but I have a feeling like it was already FBA.

12:12
If not, it was right around that time. But yeah, it was really early. There were no paid ads. There was no like, none of that stuff. was just straight, put your stuff up, take some pictures, and that was it. So out of all these, it sounded like you had a collection of brands. When did you decide to just double down on solo? Yeah, that was a long transition, right? Because we started solo playing with Solo like 2010.

12:42
And it was a difficult product to get manufactured. And so we kind of shelved it for a while, to be honest, as all these other brands that we were just selling on Amazon were just like killing it. And my mattress business was going well, like everything was going well. And so it was hard to know like, this, so we were really thinking like, as most people think, oh, if I can do it with one product, I’ll just rinse and repeat with 10 products and I’ll have 10 times the size of a business that I want. Right. And that’s what we did. And so we started having all these different brands, launching all these new products.

13:11
The majority of them all did really well. It was just a matter of how much you made on each one that kind of let some rise to the top and some were, you know, ones that you’re like, ah, it’s good. It makes money, but not tons. So it was a slow transition because it got to the point where there were so many brands. I had two partners, right? I had my partner who I was working with, who was working for in his company. He was a guy out of Washington. And so I was running the China side of it. And then my brother.

13:40
who wanted to get out of his day job, we started blogging together and I had started to sell mattresses online. I was like, we gotta sell stuff. And so I had most of my brands with my other partner in Washington and then my brother and I started this gardening brand of products and we started playing there. And we started to realize, like I started to realize, man, this is a lot of work. it just all started, because it was doing so well, it just turned into a lot of work. Like who knew, right?

14:08
It’s successful. just snowballs into this a lot of work. And I quickly found myself like kind of up to my eyeballs in it. All good problems to have, but it was like just too much, too much stress, too much work. I was just, I felt like I wasn’t giving each partner, you know, the right amount of time and the brands weren’t doing as well as I wanted to because it was hard to focus on one year. I was putting up fires and so I started to have to make like tough decisions and um,

14:35
you know, the eventual decision was to leave my partner in Washington who lived in Washington, and exit out of that company. I was a minority owner in that in that business. And so it felt different, right to be a minority owner, versus with my brother, we were co owner owners, we were 5050 with that company. And, and I had to make the decision I decided, while I tried to make it all work, it just wasn’t and I had to make a tough decision to leave.

15:03
that one partner, was the majority of the brands that were selling on Amazon. And so I was left with just two brands with me and my brother. We had, and we played with yet another brand, which is a funny story, but we had less brands. I cut ties with that. It was tough to do that. It was less about the money than it was the relationship that I had with this guy that I had worked with. My business partner was, we worked together for 12 years. Like, yeah, it was a long time and it was tough. remember actually

15:32
had that phone call in my car and I cried. Like I shed tears. was like, this is so like, why is this so hard? Like, why is this so difficult? I had nothing to do with the money. It had nothing to do with it was just partnerships and people that you work with that you, you know, build relationships. And then at certain points in time, you have to make tough decisions. And I found myself at that crossroad and had to do it. I just knew I had to do it. And so I cut ties with him. And I remember

16:02
Yeah, just telling my brother and I was like in tears and I was just like, I did it. finally did it. Like, let’s, let’s get to work on these two brands that we have. Um, yeah, let me, let me ask you this question. Uh, I know that you originally started this business, not necessarily to make money, but just for freedom. Yeah. Lifestyle. And presumably with all these brands that you were selling, you were probably pulling in decent amount of money. Right? I mean, would you say you, you hit seven figures in profit like net? Oh yeah. Quickly. Yeah.

16:32
Yeah, so that’s more than enough. And I mean, just, I can’t really, I don’t know you that well, but it doesn’t seem like you’re extravagant. I can’t see you driving a Lambo or anything like that. So why did you, wasn’t that enough? did you have this fever to want to make more money? Yeah, so it wasn’t that if you, you, anybody who, anybody knows who starts an e-commerce business that does well, like the money, when you talk about profits, yeah, it’s profits, but it’s not profits in my pocket that I can go buy stuff with, right?

17:02
You have to reinvest in the company and you have to go buy more inventory twice as much before you even need twice as much because you know, and you can see that things are going so well that you’re going to run out of inventory. And so all your money and all your profits after first uncle Sam takes his cut, which I think most budding entrepreneurs don’t realize that 40 % you got to set aside of your monthly profits so that you can pay the tax bill. And then you have to reinvest it all into new product. And, and, and not only that,

17:32
For me, the way I’ve always operated, right, as an entrepreneur, you’re always scared about something. Like while it’s going good, like in hindsight, yeah, I was like great for many years, but while you’re in it, you’re always like, is this like, how long is this really going to last? Do I got one year? Do I have two years? I see more and more people coming on board, selling more things. Like, you know who I didn’t like? I didn’t like the guy who started like podcasting about Amazon. What was his name?

17:58
There’s a ton of was like that early guy and he had great content. Amazing, amazing freedom or something like that. can’t Scott Volcker. That was his name. Oh, Scott. Yeah. Okay. Real nice guy. I don’t have nothing. I have nothing bad to say about him. I just didn’t like the idea that all the secrets were now out there. Like all this education because I was always fearful of like, well, everybody’s coming in now. Like I wasn’t out there telling everybody how to do this. I was like, why doesn’t everybody be quiet? You know, why doesn’t everybody just stay low?

18:28
lay low and we can all ride this as long as we can. And so it was a constant fear of like, this is going away while at the same time having to reinvest in the company to keep it afloat that you we didn’t get any money. Like I never got a lot of money in my pocket. And so it was just, you know, it realization that like, it’s going to be hard to actually pay myself something. We really got to get to big numbers to where I can actually take a six figure salary out of this thing. And maybe it wasn’t.

18:58
Maybe we didn’t maybe we’re really conservative. Think about it. We were coming out of oh, wait, our our source and company almost went under. We had went from like 20 some odd people down to like five because we had to lay them all off because it was oh, wait, it was financial crisis. It was like, don’t take any debt. Debt is bad. Like companies can go under in the blink of an eye. Let’s go really conservative. So all the money went back in. So it wasn’t that we like I wanted to make even more money. It was like, how in the world do I even get paid out of this thing?

19:28
I guess I gotta make it bigger.

19:32
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20:01
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20:30
And if you tell Steve that I sent you, you’ll get a hundred dollar discount. That’s E-M-E-R-G-E-C-O-U-N-S-E-L dot com. Now back to the show. Interesting. The reason why I’m asking all these questions is my wife and I, came to a similar situation at one point, but then we just said to ourselves, you can actually control your growth. It’s kind of, you know what mean? Like you can let those products maybe go out of stock or not.

20:58
place that large bet on inventory. But you know, it’s an ego thing also. And it’s, it’s also, I can’t, I can’t describe it in words, but like you want it to do well, and it’s doing well, and you want to take advantage of it while it lasts. So that’s why you’re investing a lot more. It becomes like, kind like this vicious cycle. Yeah, I think that’s what I would say. And that’s why like, even in my slide, it was like a snowball kind of chasing you down a hill is like,

21:24
I wanted to make a big snowball, but then it kind of starts eating you up. And then you’re like, well, what do I do? And, um, and that was a sense of like, that was a transition of like letting things go and focusing down on solo stove or just focusing with my brother and saying, like, I got to choose one path here because I did essentially what you and your wife did, right? You controlled growth and I did it by, kind of stepping away from one partner and a bunch of brands and then throttling it back down. Um, because we, know,

21:53
went from selling a whole lot and then now I’m with one partner, my brother, and we’re selling less. And so it did throttle it and we did find more balance over the years. I it kind of sounds, you know, short and easy, but this was over a span of like 10 years, right? So we did find good balance. And I think we kind of were seeking for the same thing that you and your wife for the same reasons you guys said, let’s control growth. We did. I did. I mean, I parted with a partner, left a ton of money on the table.

22:20
I didn’t ask for a multiple when I exited. We kind of just looked at book value and then even gave a discount on that because I was like, I’m not out to hurt you and I let them pay over many years the equity that I had in the company. So yeah, I I kind of throw the growth that way. Let’s talk about Solo Stove. Are you a product designer? So no. Well, I take that back, not by education or I don’t have a certificate.

22:49
But think I’m a pretty decent product designer. Like I think a lot of people don’t give them credit for ideas that they might have or creativity that’s within them when it comes to product. I mean, everybody uses something and is like, why in the world do they make it this way? Why? Like they should change it to be like this and it would be way better. Like we all have those experiences. And I think I just went with that. And I just, I think I’m more creative than I am.

23:18
good with numbers, like I like the creative side of things. And so I do like playing with the product. Maybe it’s my generation of like, I remember in your, in your speech, I think you opened with you’re an Asian that’s bad at math. It’s so true. And what was funny is I met a guy at ECF and we were talking, uh, his name’s, I think it’s Sujay and, and, uh, we were talking about our kids’ ages. And I was like, my daughter’s 15 and he’s like, Oh, so like,

23:47
He asked me how old I was and then he asked, and then we were talking about our kids’ ages. And he was like, so what year did you have your daughter? And I couldn’t do the math in my head. And he was like, are you kidding me? You take your age, her age, and mine is down. And I was like, yeah, I’m so bad at math that I’ve just come to accept it. And I just realized that it is just not, it’s not going to happen. And so I surround myself with people who are really good at math.

24:16
and like really analytical who can help me on that. Even my wife, I mean, my kids laugh at me because I can’t do simple math. Like percentages, I just am really bad with it. So for anybody out there who thinks they’re bad at math and can’t start a business, there’s definitely hope. yeah. So this, your solo stove or your first version of that product, it’s a pretty complicated piece of, complicated product to manufacture and design. Yeah. So did you just pick up a

24:45
CAD tool and learn how to use it and start designing? mean, paper and pencil for sure. And we were able to kind of draw things out and kind of from sourcing my experience in sourcing, you know, played a role because I had dealt with a lot of product development. And so I understood how things are made. And I understood how drawings are made and how to call things out on drawings and how to show a manufacturer that like this is the radius I want on this corner. Like I can’t do it in CAD, but I can tell them and I can sure write it on a piece of paper.

25:15
and then have them create CAD drawings or have somebody create CAD drawings off of my rough sketches, you know, my chicken scratches that I’ll just kind of move around or even using, you know, a simple app on your computer to kind of draw things out. So, yeah, it was a matter of sketching it out, drawing it out roughly, coming up with an idea of this is the size I want, this is how I want spacing in there and, you know, these are the radiuses I want. And then

25:44
drawing it out and then getting eventually a CAD drawing made to where we could say, yep, that’s kind of what we want to hear the tolerances that we can accept in these areas and then going to town on it. It was, it’s a difficult product to manufacture. Well, how long did it take you actually to, create that first product? would say it took us from the moment we started like playing with the idea to actually making it was probably close to two years because we shelved it for a while.

26:10
We started trying it. We went down the road, but remember we’re doing all these other products as well. had another partner and we were doing tons of other products and all of it was selling. And so there wasn’t this no like, was kind of take the path of least resistance and this, the solo stove path was a path of highest resistance. Like it was so difficult to make. you think about when you’re manufacturer and saying like, here’s a very difficult product. We got to spend a ton of tooling, right? We got to, we had a tool up. even requires specialized machinery to make.

26:39
and I’m only gonna purchase like $5,000 worth of this stuff. Like nobody wants to take a bet on you at that point, right? They’re like, well, yeah, if you’re gonna buy hundreds of thousands, then they’d probably do it. But we were so conservative and so small that we were like, it’s like most we can buy is like 5,000 bucks worth of this stuff. And so for that reason, it’s difficult to find a manufacturer who’s willing to dive in and do all of that.

27:07
know, development with you side by side to then have what like five grand and have their line run for half a day and then, you know, stop. you know, the tree, people don’t understand like the training that has to happen within a factory for, the workers who are actually, you know, working the machines. It’s a, takes a long time to train people up to tell them what to do and how to do it correctly. When you’re stamping products on a machine or doing deep draws,

27:36
You have to adjust tooling on the machine. And it’s this constant like, okay, set the tools. Now put a piece of metal in there and draw it down. And then it’s totally off and it’s totally bad. Then they have to adjust it. And these are huge tools that have to be lifted with like forklifts and chains. And it can take an entire day to dial in the tools on a machine and a lot of scrap and a lot of waste that has to happen as they’re punching these things down. I don’t know what good analogy for that is.

28:06
But it takes time to kind of dial things into where it can then start pumping things out really good. Well, how did you convince the manufacturer to do all that work just for a small? Yeah, it took. That’s why it took us so long, really, is the short of it. And then when we did find the right guy, we just hit it off. It’s like dating. That’s what I tell people when you’re sourcing and you’re finding a manufacturer like it’s like dating. You have to find people who like you for whatever reason. Like, I don’t know if it was this.

28:34
I don’t know if it was my personality. don’t know if it’s like, you know, this, this, the challenge of seeing if we can get this thing to work that he was interested in, like the dynamics that were going on in his business, in his head. I I’m not sure exactly why he wanted to do it. I think it was more so the challenge of like, this is difficult and this is challenging and I’ve never done something this hard. Um, and I think it’s a cool project and I want to see if I can do it. It was more like a, like a hobby or like a, you know, a challenge for him.

29:04
So we tackled it together and we just built a good rapport together doing this and turned out extremely well for him and extremely well for us. yeah, was extremely difficult. That’s why I say, man, I got lucky a lot of times because I met a lot of suppliers who were just like, nope, nope, nope, or I want to do it, but can’t do it. I don’t have the right machinery and I’m not willing to invest.

29:29
You know, so a lot of stars had to align for me to feel like I got lucky and found a good supplier. Like it really did just come down to luck. Were you in China during the production, like managing everything? At that time when we started Solo, my brother was here in the States, here in Texas where I’m at now. And I was on that side, really dialing in the supply chain and getting things going. Let me ask you that. Did you think that that was necessary for you to be over there?

29:58
this complicated product? mean, I guess if you’re asking, could somebody do it if they weren’t in China? Sure, I’m sure someone could. Is it easy? Absolutely not. Does it help that I was in China? Yes, absolutely. Does it help that I can speak Mandarin? Yes, absolutely. Did it help to have years and years of experience dealing with suppliers and finding suppliers and understanding how to build relationships with them? Yes. All of that played in.

30:27
us being able to kind of dial things. But you look at great companies like, I don’t know, I can’t think of any off the top of my head. mean, I’m sure there’s tons at ECF that were at ECF that never lived in China, don’t speak Mandarin and can still make amazing products. I think there’s, we all have like advantages that we can lean on to give us a leg up. Where I’m bad at math, right? I was good at sourcing products. And where somebody else is a whiz at math, can figure out that

30:56
you know, this is how much you need to save for taxes every month where I faltered in that. And one year I was like, we got stuck with like a $400,000 tax bill that I thought we were prepared for, but we barely saved up enough money for that and almost like dried out our company because I was like, yeah, just going by my gut feel of like what the numbers should be. And obviously I was horrible at that and horrible at planning with numbers. So I think we all have strengths that we can lean on and I think you should.

31:26
double down on what you’re good at and then solve for the parts that you’re not. So you have this product that you took two years to develop. So one, did you know that it was going to sell during those two years? And then two, how did you sell your first units? Yeah, I knew it would sell. I’m a strong believer that like anything can sell. There’s someone out there who will buy it. It’s just a matter of how many, right? And so I think I gained a lot of confidence with all the products that I had launched.

31:56
on Amazon and D2C that everything sold. There wasn’t anything that just like sat on the shelf and was a total dud. And so everything sold and I knew, especially in those days of Amazon, if you played in those days in Amazon, you knew everything sold. Like it was just a matter of how much. Actually, when I started everything sold also, and that was 2015, 2016. Yeah. So it was, it was, it really helped in that, in that, in that area of confidence.

32:26
made me believe like, yes, this will sell. I don’t know how much. And I think a lot of people get stuck on that in terms of like, is there, all the buzzwords of product market fit and like, you know, have you done your research? I was like, what kind of research would you do? Like ask people if they would buy it. Like I don’t even know what you would do to get something of like statistical significance at a small, like you’re just two guys. Like what are you going to do to figure out if this thing’s going to sell?

32:52
In my mind, the best thing to do is just go sell it. Don’t sink in too much money and then go try to sell it. And if it sells well, then just double down, right? Then order more product and then start developing it out. But if it fizzles and dies or you’re stuck with $5,000 worth of product that sells over the next five years, you can still get rid of it all and give it away for Christmas presents throughout the years. so it was never a big risk to me. But no, we did not know how much we could sell or how well it would sell.

33:22
right off the bat. we were, we surprised. How much money did you invest in product development to get like your first? Yeah, so we put in $15,000 to start that company. And that’s it. And so for first, that’s not a lot. It’s not a lot because a lot of it went to, you know, ordering the first product and some of it went to tooling and, and paying for software and paying for, you know, a shopping card and get like all of it together. It was like, we needed to make it work with all that money, all the

33:51
Freight like all the shipping and freight and all that stuff was kind of baked into the fact that like we had 15,000 bucks to work with and that’s it. And that’s that’s how we grew it. Okay, that’s much lower than I would have expected. Okay, wow, that’s amazing. Okay, so you’re you you get your product, you listen to Amazon, it sells like hotcakes. Walk me through the progression from there. Actually, yeah, like whittling down kind of like focus. Is that what you mean? Yeah, so from there,

34:20
You know, things continue to do really well. We started selling other products, gardening products. We had a gardening site. Was this an Amazon only product by the way? The stuff? Or were you selling DTC? Just the solo store? We had set up a website as well. Yeah. So all, so me and my brother were kind of big on websites, like our own DTC sites, like our own .com sites, because I had kind of gained that experience through selling mattresses.

34:46
And I realized early on that you can have your own site and you can have traffic to it because I understood how you can build traffic by blogging. Through blogging, I understood that traffic could be built. While I knew Amazon had traffic and that was a great way to basically print money, I also knew you could have your own site and you can also develop your own traffic. And so that wasn’t foreign to me. In fact, it was more attractive because you can be more creative.

35:14
when you’re driving traffic to your site. And so we had stuff on Amazon and that’s where the majority of sales came from, but we did have our own sites that we would set up because we knew like people would check us out. Like, is this a legit brand? What does their website look like? And so we had from the get-go, me and my brother were really strong in building our own sites. And some of the other products like gardening products just never took on our own.com as hard as we tried. And those did really well on Amazon. And we eventually started selling

35:43
This is so me and my brother are pretty clean cut dry guys. don’t drink, we don’t smoke, we don’t do drugs. But we were thinking as we were selling these gardening products, we got to even out the seasonality of gardening. How do we even do that? And we started researching product and my brother stumbled upon these things called grow lights. And he was like, oh, people grow stuff indoors using these things called grow lights that mimic the sun. And I was like,

36:12
That’s ingenious. That’s so cool. And we’re like, that could even out the winter months. Like people could grow indoors. And so we were trying to even out our seasonality and we ended up like selling grow lights and starting a website called super led grow lights.com. And we brought in like thousands of dollars worth of these grow lights only to eventually find out that people don’t grow like tomato cherries and like cilantro indoors. And we were so naive to the fact.

36:39
that people were asking about what the heat signature is from the roadside. And we’re like, what is that? Why do they even care? Because cops in the days would use a heat gun and kind of see what houses are glowing from the street side to see who’s cooking stuff inside or who’s growing weed and marijuana in there. And so we were like, this is so weird. And so we eventually figured out that everybody was using it to grow weed.

37:07
And we were like, we gotta get out of this. And so we shut that down and we closed it up and we just sat on those grow lights in our garage. I don’t even know what we did with them. I think a lot of them we threw out. But that was another one that we started our own website and we’re selling on Amazon as well and all this stuff. But we started wheeling down because things started going really well on all fronts. The gardening stuff was doing well. Our solo stove was doing really well.

37:37
Oh, and we had started another brand called Fox Outfitters. And that was another camping me too. So you kind of see this, like, do see how like, things are just like, we’re just rinsing and repeating. And we’re kind of like, causing our own problems by doing this, right? We haven’t found out how to find that balance of just saying enough’s enough. Let’s just hold it steady. We’re just in this constant state of like, did you have employees during this time, by the way, or was it just you and my brother the whole time? Wow, crazy. Okay, so we had

38:04
Fox outfitters, had solo, we had at one time super LED grill lights and we had this other one called the garden cloche, which were these bell cover, these plastic bell seedling coverings that would act as like a mini greenhouse on seedlings. And they were all selling well, everything was doing well. Which again, found ourselves, I found myself in that same problem of like, we built something that we didn’t really want. It was like too good, everything was going too good.

38:32
And so we started to try to figure out what the next step was to kind of regain that lifestyle that we were in search of and the reason why we started these companies. And that led us to let’s sell and get rid of this stuff. Like let’s sell it all and just exit out of the company and see if we can’t start again. You know, we were trying to build that four hour work week lifestyle company and we were obviously doing okay, making money along the way, but…

39:01
having a hard time finding that that kind of autopilot mode where it’s a great company that’s going to last forever. And it’s just printing you money every day, you know, that smart passive income, right, that Pat Flynn is I was hanging, what was always the elusive goal of like, he’s figured it out. Why can’t we figure it out, right? ours always end up turning into something way more than we bargained for. And that’s took us to 2016. And we decided, okay, it’s too much. It’s more than we bargained for. We’re working way too much on this stuff. Let’s sell it and

39:31
That’s that’s so all of it. Yeah, we wanted to sell all of it and just start again. I don’t know what we were going to start or maybe it was, you know, if we could get enough money, maybe that would be enough is one of the thoughts. The other thought was like we can start again and build a better business that doesn’t turn into a snowball chasing us down the hill.

39:52
I just wanted to take a moment to tell you about a free resource that I offer on my website that you may not be aware of. If you are interested in starting your own online store, I put together a comprehensive six-day mini course on how to get started in ecommerce that you should all check out. It contains both video and text-based tutorials that go over the entire process of finding products to sell all the way to getting your first sales online. Now this course is free and can be obtained at mywifequitterjob.com slash free.

40:21
just sign up right there on the front page via email and I’ll send you the course right away. Once again, that’s mywifequitterjob.com slash free. Now back to the show.

40:32
Let me ask you this question. Was it really hard time-wise because you didn’t have lot of employees? I mean, you didn’t have any employees? it eventually got hard. And I’ll tell you why it got hard is because we were still pretty protective of our time, right? We still were trying to live this lifestyle. We were trying to walk the walk and live a lifestyle that was balanced, that we had enough time for our family. We both have kids. So we both had small kids.

41:01
and you know, in the toddler age and you know, or we want to spend time with the family and with our wives and on ourselves, right is, you know, your physical health and your mental health and your spirituality and all these things that your hobbies like I wanted it all. And, and that meant that while I while I was walking the walk and enjoying this lifestyle, the hours that I was working, which was a, you know, your standard, I would say I wouldn’t say nine to five, it was probably more like, you know,

41:30
eight to six at most. Sure. We had to do more in those hours than ever before. And so it was really stressful, really compact, really like high pressure in those hours that we were working. And then we kind of turned it off and then tried to go do, you know, live our lives. And so it just was this built up pressure because we weren’t stretching out. I take that back. There were

41:56
times where we were working into the wee hours of the morning and it eventually got there, right? Where we were, we were working way more than we wanted to, you know, kids go to bed and then you flip open the laptop and keep going. were doing all our customer service. So that’s like a constant nag on you is like, you don’t want to let those tickets sit for more than they should. And so we’d hop back on, get through customer service. So then the next morning it would just let it pile back up again. And so yeah, it got really, it got really busy.

42:26
I guess my question for you is why didn’t you hire? Yeah. It’s so funny hearing other people say it like, duh. And even in my mind, I’m like, yeah, like that’s how like, that’s how, that’s how like novice of a business person I was, I guess, inserting a company in that, um, we didn’t, I mean, we did think to hire Steve, wasn’t a matter of like, we never thought about it. I thought about it, but I was always under this impression that we wanted to build this company that didn’t have anybody in it.

42:55
Because we didn’t like managing people were not great, right? People managers and you know, the dynamics of people is just difficult. We’re working from our homes and so it’s this big friction to like now we got to get an office and go in nine to five and be there to be with them. It’s like what about our lifestyle business? Our whole lifestyle business was flexibility so that if we needed to pop out in the middle of the day or if we wanted to go, you know, fishing from 10 in the morning till two.

43:23
we could knowing that we could make those hours up somewhere else. And so this thought of like going down that road was going against everything that we wanted to build. Like our ideal company was one that gave us our lifestyle, gave us enough money, and most importantly gave us that freedom and flexibility. And employees just was everything. It was like the, you know, it was everything against that, what we were trying to build. I can completely relate to everything that you’re saying. It’s just funny. Cause I know most people.

43:52
they tend to think that hiring employees is pretty glamorous. Right. That’s the opposite for me. Yeah, and me too. And we’re because even the complexities of it, right is like, I like the marketing, I like making product, I like I like e commerce, I like all the tactics and that stuff. Anything about okay, employees, one, I don’t even know how to do that. Because what do have to do? Do I have to like, how do I even do payroll now? And do I have to offer benefits? Like, and where will they sit? Like, do I have to buy them all their equipment? And then like, what who’s gonna even teach? Like, do I have to teach them? Like,

44:21
All of these thoughts, I think ran through our heads. And it just was a lot of friction for us to be like, that’s the right path. It doesn’t seem like it if it’s, if it feels like a lot, like a lot of friction, but in hindsight, right? Should we have hired earlier? think, yeah, I think we probably could have hired earlier. think we probably could have hired to a point where it was running smoothly and, you know, doing really well. And maybe we didn’t have to go down a path of selling it. I don’t know. I mean, I think there’s a lot of ways

44:51
Skinny Cat. And I think there’s a lot of curvy paths to the same destination. And the beauty of owning your own business is you get to choose your own adventure for better or for worse. And I think we chose the way we did it. And it did eventually lead to building out a team and growing as we figured out if we are to exit this thing, then there’s a clear path that we need to follow, which is a little bit counterintuitive to

45:20
what someone did you enjoy that path of selling? Yeah. Oh, no, I did not. mean, hi. Well, what I’ll you, it’s type two fun, right? It’s type two fun, where while you’re in it, it’s horrible. Like, it’s, it’s, it’s like self abuse, and you don’t know why you’re doing this to yourself. And then you get through the other side. And you’re like telling other people all the cool stories. And yeah, like I did this, I did that. And I think you kind of forget.

45:48
all the pain that you went through or your selective memory. And so when I’m talking to it’s like having kids, well, yeah, I dare I don’t dare go down that route. I’m not I did not give birth to my kids. My wife did that. And I would never say that it was that difficult. Yeah, I mean, I think the analogy holds in that, you know, you forget about some of the pain. But no, I didn’t enjoy it. I didn’t enjoy it because we’re doing everything that we didn’t want to do that we tried not to do. But

46:16
I did it because it was a means to an end. It was means to the end. in 2016, we tried to sell the company. It had Fox Outfitters and it had Solo Stove. And Fox Outfitters was the majority of the revenue and profits. And Solo Stove was kind of the little brother that had a lot of potential. And that’s really the short story of it is we came out of it knowing that nobody really wanted our Amazon company.

46:45
Amazon brand that was doing millions of dollars and people were more interested in this little brand that we had built that has momentum on its dot com, its D2C. While we were still selling a lot on Amazon, there was glimmers of hope for this brand. There was glimmers of hope in the IP. There was glimmers of hope in product development and what it could turn into. And that’s what we ended up doubling down on and letting go of Fox.

47:12
We actually sold it to some guys in Houston who wanted to get their toe, you know, dip their toes into e-commerce. Um, and we sold it for pennies on the dollar. We just let go of the inventory. I know that’s amazing. That’s a tough decision right there. It was tough. It was a little bit sad to kind of do it that way. While we were selling it, I was honestly telling me and my brother had a conversation of saying like, the people would ask us, what are you going to do? Like, uh, if we, if we don’t buy this and, and I remember telling them, I was like,

47:41
I don’t care if you don’t buy it. It’s a great deal. It’s pennies on the dollar. I just want it off my books because I got to clear up my books and clear up my warehouse and all this stuff for, we’ve to get ready for the dance and the stuff’s in the way. And I said, I don’t care if you don’t buy it because in my heart of hearts, I could go turn this thing into a multimillion dollar business after I’m done and I have time. Like I know I could do that. And so it was this like feeling of, man, this is good for someone. This could be the difference of somebody working in their

48:10
day job hating life and finding freedom. This is a tool that could do that. I just hate to feel like I just toss it to the side. But the truth is, we didn’t have time to sell it the right way. We didn’t have time to try to go through diligence with someone on it. This is what it is. Do you take it or leave it? And if you want it, I’ll give it to you for pennies on the dollar and it’s yours. And that’s how we let go of the majority of our revenue and profits at that time.

48:37
and six in 2016 and then double down on solo stove. Wow, Spencer, I want to shift gears a little bit and I know you had an amazing exit. You probably don’t need to work another day in your life. What are your future plans? So and we were talking a bit about this before we hit the record button, but I’ve really loved diving into like content creation. I think it’s the creative side of me that needs an outlet and

49:03
So, you know, I registered my own company. got a, I got an office space that has a whole bunch of offices and a front room and, know, got a whiteboard and just started thinking about how can I give back and help others like find, find value and find freedom through entrepreneurship. And not that that’s the only way, but it’s the way I know. And it’s the experiences I have that I can give an offer. And so I’m trying to find a way to do that in scale and try to.

49:32
help others explore the path of entrepreneurship as a viable path to one, a career, and then two, a better lifestyle. And while it was a difficult road for me, I think it’s possible. I think it’s a very, think entrepreneurship is net positive, right? Jobs are created. The ripples effect of someone being able to start a company and.

49:57
provide for their family and for other families and what it does in society. think it’s a good thing. And so I’d like to continue to find ways to champion entrepreneurship. I started a YouTube channel that talks about entrepreneurship and e-commerce, but I’m starting to even transition. What’s channel called? It’s just Spencer Jan. So if you just look up my name, you’ll see my mug up there making funny faces as I try to win the thumbnail game.

50:24
but I’m trying to transition to actually just visiting more companies and not in venturing outside the realm of e-commerce. Like I want to go visit a donut shop and I want to go visit somebody who opened a flower shop or somebody who started a car wash because all of these are valid businesses. And I think the learnings that I have while they lend towards e-commerce companies, I think the fundamental principles still translate to other businesses. I feel like telling other people’s stories

50:54
Uh, in, those lights, whether it’s a, uh, a mobile dogwash station or yesterday I was at a skincare clinic of, uh, of a female entrepreneur who started this, this, this company that now has two clinics here in DFW and is making amazing money. want to tell more of those stories. So hopefully I kind of get to that point and hopefully it resonates with people and helps people explore that, um, that entrepreneurial bug or itch that, um, a lot of us have.

51:24
I was just thinking, just listening to your voice right now, I think you should do a podcast too, in addition to your YouTube. Yeah, that might be. think I, I’ve enjoyed being on podcasts and I enjoy talking with others. I think that’s what I get out of it. I’ve, I’ve kind of, I kind of am, am searching for that kind of fulfillment, right? Because chasing dollars and numbers really is a pretty empty thing to do. Um, and so I’ve realized that I gain a lot and I learn a lot and I enjoy.

51:52
talking with others and hearing their stories, um, meeting other people like yourself and all the people that we met at ECF. Like to me, that’s super rich and fulfilling. Um, and then being able to have, find opportunities to help those people and those listening, maybe, maybe I go down the road of podcasts and then I need to pick your brain and figure out how to set it all up. I’ll tell you what I have bought so much equipment.

52:16
that Amazon is about to ban me, because I buy it all and then I return most of it, because I’m like, oh no, I need a different mic. Oh no, that one didn’t work. So just this learning experience of how to set things up properly has been fun for me. Awesome. Well, hey Spencer, thanks a lot for coming on the show. If anyone has any questions for you or want to find out what you’re up to, where can they find you? Yeah, I’m not big on social. I try not to spend too much time on social media. I am on LinkedIn.

52:44
except for that TikTok channel. that has one post. I think I got to hire somebody to build that out. I am on LinkedIn. So you can find me on LinkedIn. You can also just email me at hello spencerjan at gmail.com or you can find me on YouTube as well. Drop me a comment there. And I think my contact information is in there as well. So I’d to hear from any budding entrepreneurs and anybody who’s looking for a sounding board for crazy ideas, more than happy to kind of try to fit people in and.

53:13
and talk to as many people as possible. Cool. Well, Spencer, it’s been a pleasure. I’m glad I met you finally at ECF. Yeah. And I know you’re emailed by heart now. Thanks, Steve. It’s been fun. All right. Take care.

53:28
Hope you enjoyed that episode. Now I can’t really express in words how much I admire what Spencer has accomplished and how candid he was in this interview. Go check out Solo Stove when you get a chance. For more information about this episode, go to mywifequitterjob.com slash episode 416. And once again, I to thank Clavio, which is my email marketing platform of choice for e-commerce merchants. You can easily put together automated flows like an abandoned code sequence, a post purchase flow, a win back campaign. Basically all these sequences that will make you money on autopilot.

53:56
So head on over to mywifequitterjob.com slash KLAVIO. Once again, that’s mywifequitterjob.com slash KLAVIO. I also want to thank Postscript, which is my SMS marketing platform of choice for e-commerce. With a few clicks of a button, you can easily segment and send targeted text messages to your client base. SMS is the next big own marketing platform and you can sign up for free over at postscript.io slash Steve. That’s P-O-S-T-S-R-I-P-T dot I-O slash Steve. Now we talk about how I these tools in my blog,

54:26
And if you are interested in starting your own eCommerce store, head on over to mywifequitterjob.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.

00:30
She never took any funding and she bootstrapped her business completely from the ground up. And today she’s going to teach us how she did it. But before we begin, I want to thank Postscript for sponsoring this episode. Postscript is my SMS or text messaging provider that I use for e-commerce and it’s crushing it for me. I never thought that people will want marketing text messages, but it works. In fact, my tiny SMS list is performing on par with my email list, which is easily 10x bigger. Anyway, Postscript specializes in text message marketing for e-commerce.

00:58
and you can segment your audience just like email. It’s an inexpensive solution, converts like crazy, and you can try it for free over at postscript.io slash Steve. That’s P-O-S-T-S-E-I-P-T dot I-O slash Steve. I also want to thank Klaviyo for sponsoring this episode. Always excited to talk about Klaviyo because they’re the email marketing platform that I use for my e-commerce store, and I depend on them for over 30 % of my revenue. Now you’re probably wondering why Klaviyo and not another provider.

01:25
Well, Klaviyo is the only email platform out there that is specifically built for e-commerce stores, and here’s why it’s 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 autoresponder sequence to my customers depending on what they bought. Piece of cake, and there’s full revenue tracking on every email sent. Klaviyo is the most powerful email platform that I’ve ever used, and you can try them for free over at klaviyo.com slash mywife.

01:55
That’s KLAVIO.com slash my wife. And then finally, I want to mention my other podcast that I released my partner Tony. And unlike this one, where I interviewed successful entrepreneurs in e-commerce, the profitable audience podcast covers all things related to content creation and building an audience. No topic is off the table and we tell like how it is in a raw and entertaining way. So be sure to check out the profitable audience podcast on your favorite podcast app. Now onto the show.

02:29
Welcome to the My Wife Quarter Job podcast. Today I have Tori Gerbig on the show and Tori and I were recently featured on the Ashley Banfield show where we shared some tips on how to start an online business. And Tori is the founder of pinklily.com, which is a nine figure business that sells clothing and boutique fashion. Now, what I find impressive about Tori is that she grew up in a working class family, nothing out of the ordinary, and turned a side hobby of selling clothes into a hundred million dollar company. And within her first year of business,

02:59
Pink Lily hit the multi-million dollar mark and it’s grown to a business of over 200 employees. She’s been featured in Forbes, Entrepreneur, Huffing Post, and she was in Inc 5000 Company in 2018. And what I actually admire more is that she is a mother of three and she works with her husband just like I do with my wife and our business. And in this episode, we are going to find out exactly how she did it. And with that, welcome to the show. Tori, how are doing? Hi, how are you? Thank you so much for having me on today.

03:27
Yeah, know, Tori, so I actually teach a class on e-commerce and what I always tell people is that clothing is actually one of the hardest types of products to sell online. Absolutely. So I’m just very curious how you got started. So it kind of was by accident. I went to school for marketing and sales, not fashion. And I knew that I really wanted to sell a product. So I learned how to do outside sales. I thought, you know, I would do

03:53
personal selling, maybe medical device selling something along the way. I actually went into insurance industry and it was okay. I was in it for over five years, but after my husband and I got married, we really weren’t making much money combined. I had no experience. It was right after, you know, a recession was going on. We’re talking 2009 to 2010 when we got married. So really hard to find a job. Um, come 2012.

04:19
We were just really struggling and could not make ends meet. So we started selling items on eBay and Etsy and started out with very random products. I’m talking like golf clubs, USB, hard drives, random stuff. And it did pretty well. We sold items on eBay and Etsy for about a year, year and a half. And then fast forward to 2013, I was pregnant with my son, looking over my benefits, my maternity leave options.

04:47
and freaking out about having unpaid maternity leave. So that was something that made me so nervous. So once my son was born, really were like, look, we’ve got to pick up this online selling just to supplement our income. So I invested a little bit of money, I think maybe just a couple hundred dollars in some little girl boutique clothing and some adult boutique clothing and started a Facebook group at that time. The Facebook group,

05:12
was primarily just local people from my town, but it grew pretty quickly and it grew from, you know, a couple hundred girls to over 10,000 women by the time I started back to after my maternity leave. So I started selling clothing on there. I didn’t really sell clothing on eBay or Etsy. It was just mostly through the Facebook group. So I was showing the items. I was PayPal invoicing them. I was shipping the items, all of this at nighttime after I worked my full-time job. And after I got my son to bed,

05:40
And so I really didn’t sleep much at all in 2013, like that last quarter. And at the end of about November, my husband’s like, we cannot continue doing it. It’s so manual. We have to start a website. Like this is too manual. You PayPal invoicing people, you going to stamps.com, creating the labels and it’s just too much. So we are going to start a website. We’re going to take the money that we’ve made, the profits from selling on online so far. And we’re going to just start this website.

06:08
So December 31st, January 1st of 2014, we kicked off pinklily.com. It was really a right out of the box, horrible website. Like it wasn’t good at all. So slow, site speed, everything. We had no prior experience, but it was like just him and I who did it. And we were like, okay, our goal for the year is $50,000 in revenue. That will help pay off our credit card debt and some of our student loans. I’ll still work my full-time job.

06:37
He’ll work his full-time job. It’s just a side hustle. By month two, we had already hit the 50,000 and then by six months in, we hit a million dollars in revenue. I walked away from my job in April of 2014. It was terrifying. Everybody was like, no, you can’t quit your job with benefits just for an online site. And then my husband walked away from his job in July that same year.

07:03
And then rounding out in December that year, we hit $4 million in revenue and had seven full-time employees. all from like just this starting in our house and by the end of year one, having, you know, a team of seven and hitting $4 million in revenue very quickly. In the first seven months, we actually still were in our house too. So like we were packaging the orders up to the very like first million dollars of sales all on my dining room table. Tori, what’s funny is your story is almost exactly like mine. We started on eBay.

07:32
We were just selling some handkerchiefs and they were running it all over my house. And then my wife, she didn’t like her job. And when we had our kid, we were like, okay, we want to stay at home with the kids. And we ran everything out of the house. And our goal was actually $50,000 our first year also. We hit it really quickly. And then my wife was like, okay, we got to start a website. Cause I was making the rounds at this post office carrying like a car full of boxes and they all knew me and they actually hated me.

08:00
I’d occupy the line for like a long time, right? But it’s funny. Let’s take it back to the beginning. I’m very curious. So where did you source those first clothes for Etsy and eBay and that Facebook group? Yeah, so we I worked with some vendors out of LA to get some products and mostly for eBay. I think one of the biggest things we had that sold in 2013 were bubble necklaces. So a lot of jewelry really did well on eBay. Same with Etsy. So Etsy also

08:30
monogrammed on the side like to I was like, well, I’m gonna buy a monogram machine. do that too. Yeah. So that was very time consuming. I realized that was not the best use of my time. I sold that monogram machine. So yeah, it was just kind of like scarves and jewelry mostly. And I sourced them from, you know, places, LA, China, fashion district or do it fashion. Okay, yeah, yeah. Yeah. Cool. And then these are not with your brand on them, though, right? These are just

08:59
Already made. OK. Already to sell turnkey products. Yeah. So how does one grow a Facebook group so quickly, actually? So you mentioned in the beginning it was just Kentucky folks, right? How did you attract other people? So I think at the time, of course, the timing was great for Facebook and it was, you know, back before the shifted where now it’s more paid placement. was very organic back then. So it was easy. But I also have a social media

09:29
I have a social media or I have a marketing degree. So social media was always something that I loved and I learned it as quickly as I can when a new platform comes out. So Facebook was something that I knew very well and I knew certain strategies of how to grow it, know, build it as a community, you know, do fun giveaways, get women excited about the product, do the live videos or the,

09:52
photos, you know, and kind of just go off what works well. If you see that this photo is getting a lot of response, continue to do photos similar to that style and, and just kind of like taking it. It was very scrappy too. And I think that people loved it. It wasn’t like this put together beautiful photos, literally like an iPhone photo of me in my house wearing the product. And I think women just could relate to that a little easier than just that, you know, your typical models that you see on Victoria secret or places like that.

10:22
type sites. So were people just finding your group through word of mouth or were you advertising it? It’s just word of mouth. It was a group. So it wasn’t you couldn’t do paid ads for a group at the time. So it was really just like by having people add more people to the group. So can you kind of walk me through like how often were you posting and how did you build a community? So I would post several times a day. I think that’s the strategy to with any good social media platform is to

10:49
make sure you’re consistent with your posting. But building the community, was always on there. So even while I was working my full-time job, I was answering girls questions and they felt like they can ask me, hey, how would you style this or what would you recommend size I go with? And really to like give them that personal shopping experience almost from the very beginning and to also like allow them to tell me what they wanted to buy and what they were looking for for us to carry and such. really

11:17
to listen to them and always put them first, really helped to elevate it. And that’s kind of been behind the brand since the very beginning, as we always put the customers first and foremost. So were you going live in your group or was live available back then? Probably not, right? Live wasn’t available back when it very first started, but it quickly became available. So yeah, we’ve been doing live since the beginning of live creation. is Facebook group still around? Are you still active in the group or?

11:45
group? No, I closed it down after we started Pink Lily and then we started a Pink Lily group right after and our Pink Lily group has I 120,000 women in that private group. So our sales, I imagine since you have a website now, you don’t do sales directly into the group, but is that a way to like showcase new products and get feedback? Yeah, so we do it. We showcase products, but

12:09
We also definitely get feedback on like, are you wanting for us to buy for fall? Or, know, what kind of styles would you like us to carry? And really giving them more of that inside behind the scenes feel. But also the biggest thing that does so well in our group is we allow all of our customers to post their own photos. So all of them are actually running the group for us by posting content because they’re excited to share what the dress looks like on over their outfit. And then all these women are supportive on them saying, oh, you look great.

12:38
how does this fit and they’re answering questions and they’re together on this group and it works really well that way for us. Cool. So are the moderators of the group just super fans of your brand for the most part? Yes. We actually have, most of them are workers here and then yes, anyone is allowed to post in the group. We approve it. We approve it here internally. Right. Nice. Okay. So you go from this Facebook group, it gets out of hand because you’re manually invoicing everyone. You start this site,

13:08
It looks bad. It’s slow. How do you get your first sales on your site? Is it just driving through the group to the site? Yeah. So at that time, right after we launched the Facebook or the website, we launched a Facebook page and that’s where primarily most of the sales would came through in year one was all through Facebook. So I did not have any knowledge of Google ads. have no knowledge of anything else. Instagram really wasn’t big yet.

13:33
Pinterest, probably some too actually. We did go viral on Pinterest a few times our first year. So Pinterest and Facebook were those key drivers. The Facebook page, I did start doing paid ads on there by the end of January, 2014. But again, I kind of taught myself all of that with not having background knowledge on any like paid placement, paid social. Right, right. So, but to go from, did you say you hit 4 million in that first year you said? Yep.

14:00
Okay, so how does one go from just a couple hundred thousand to four million? Is that ads or is it just the size of your group? Like how do you grow exponentially like that so quickly? So I do think ads was a little bit of it, but I think we were very lucky on our timing too and to have things go viral on Facebook and on Pinterest that year. So we had one photo of a cardigan that

14:26
had over 700,000 repins on it, like after it launched and we sold all 300 in a day. And that was just luck of the nature. know, it’s really hard now to go viral. And so I do try to explain that because eight years ago, social media and today social media, but you can, still can go to TikTok and go viral. There still are opportunities. So we just had those few moments.

14:50
And then we kind of played off of it from there. You know, we did spend a little bit of money in ads and I don’t know the exact amount, but it was very little and it wasn’t, it was really just curating that community on Facebook group and being very consistent with social media. So most, would say year one and two, most of the sales were organic sales. Okay. And then in terms of product sourcing, did you have like a steady factory at that point or were you still just kind of sourcing stuff from the fashion district and whatnot?

15:19
So yeah, no, years one through three all came from LA Fashion District. We did not have any factories. We still don’t have our own factory. We do work with manufacturers now versus paying as much wholesale. We still work both ways, but yeah, I would go to Fashion District up until 2016 even, I think 2017, it all came from there. So when you go to the Fashion District, you can say, hey, I want you to sew my label on there, right? And make adjustments.

15:49
Yes, correct. It’s been a while since I’ve been there. I we did shop there also. The minimum order requirements are generally lower there also, right, depending on who you find. Yeah. But we got to a point quickly about 2016, 2017 that we were needing three to four hundred per style that we carry. So we hit them very easily. Yes, the order requirements are very low, but the more you buy, the more willing they’ll work on pricing with you. Yeah. I mean, one of the challenges of clothing also is

16:18
the sizing and the return rate. How do you, how’d you deal with that early on? So sizing will still always be the biggest issue and we’re still trying to figure out the best way to overcome that. One of the, some of the couple recent changes in the last two years have been having several different size models on the site and then also doing videos that explain how the item fits. Yeah. So the sizing will always be the number one issue because it’s very hard to know your size when you’re shopping online.

16:46
But we definitely have implemented new strategies the last two years by having several size models and then also to do videos on the site that try to explain the fit. if they should size up or size down or stick with their true size in a size chart. In the beginning, I will say it was probably the number one reason of returns was this just didn’t fit me. So it’s always going to be a battle with clothing online, there’s hopefully even…

17:13
in the near future, more things that come out on helping women to, men too, to really understand what size that they should buy before purchasing. How much money did you start with and did you invest into Pink Lily when it launched? So when we launched the site, we had been selling on eBay and Etsy for about, in that Facebook group for about six months. And I think we had about $10,000 in our bank account to save aside from all of

17:40
the profits to reinvest. So we started very little, like a couple hundred dollars for eBay. And we’d always reinvest the money and put a hundred percent of the profits back into the account to grow the inventory. So when we started pinkfully.com, we had about 10,000. We I think spent $500 on the website and then the remainder all went to inventory to launch. So we had, you know, a small selection of clothing to, you know, I think 20 to 30 styles when we launched.

18:08
Wow, okay, so 10 grand for 23 styles. That means it’s not that many units of each, right? No, at the very beginning I would get like one pack, like maybe six units per style. And so it was basically up to you to understand and know what was gonna sell, right? Or did you just buy that many styles to see what would sell and then focus on your winners? What was your strategy? Oh, I didn’t really have a strategy. I kind of just would buy what I personally would wear and what I thought would sell well and then go off trends. So back in the day,

18:37
in 2014, like Chevron was huge. So, okay, I sold a Chevron Maxi. It did really well. It sold out so fast. So then I would turn around and use all of the profits to buy five more Chevron Maxi. So I kind of played off what was selling well to turn around and buy more product in that same area scope to see if that continued to do well. And when did you start introducing models for your clothes? I mean, that costs money, right? Yeah, immediately. we immediately. Yeah. When we launched, we launched with models.

19:07
We did some flat lays, but typically the clothing for us sold better on a model. Yeah, so where did you find the talent and was that a huge investment on your part to hire these models for photo shoots? We found the talent. have a college here in town and we found the talent just by I actually looked on Instagram and I was like I want to DM a few girls see if they’re interested. I did all the photography in the beginning for the about the eight months too. It took most of my.

19:36
time doing every single job. But then we hired a full time photographer, I think by August of our first year and we’ve had now we have I think three full time photographers. We have like seven models that are here most days and yeah, it is an expense. But for us it it’s necessary. It was always worth it. That’s amazing. So you bootstrap with $10,000. That’s amazing for clothing. Yeah. Yeah. What does your husband do? I’m kidding. Since I’m a husband and wife team also and yeah.

20:06
Yeah, she’s kind like the face of the company because I can’t talk about handkerchiefs or that sort of thing. What is his role? So his role is he is the president of the company. He oversees all of the operations side, the HR side and the finance. So he has a degree in finance and his MBA. So that’s his specialty.

20:24
but he also did logistics at his previous corporate world. So he has a lot more operation knowledge than I do. So we kind of split, I’m over product, over customer service, I’m over marketing, face of the brand. He’s on the back half of it on the operation side and the HR, all the harder stuff, but it’s all hard, but it’s stuff that it’s just like people don’t always understand like the backend of a business. Yeah, no, that totally makes sense. Actually in the beginning when my wife and I worked together,

20:52
closely, we kind of overlapped in our roles and we just kept clashing and fighting and it wasn’t until we separated everything out and things are good now, but it took a while for us to get there. Yeah, we don’t overlap very much at all. There’s really not a lot to them. The product development and marketing side, he has not much to other than money. That’s about it. That’s really the only like, okay, here’s your marketing budget for the month. And I’m like, no, we need more. And he’s like, no, you can’t go over this amount. So that’s about the only thing that we really

21:22
a lot of like conversations on, but we have demand planning and forecasters now. So he’s out of that budget, you know, a finance team that sets the budget. So he just oversees them now. It’s not him setting the budget. Right, right. Yeah. So you’re growing really fast. And I know that when you grow fast, it’s extremely uncomfortable. It seemed like you were switching out warehouses like every year or less. Walk me through that time, if you will. Things are growing fast. What were the first things that you’re implementing in terms of infrastructure?

21:51
during that growth period? Yeah, so our first warehouse, what we thought was a warehouse, we moved into in July of 2014. It was 1,500 square feet. So we’re like, oh yeah, this is huge. At least it’s out of our house. And we quickly realized it was way too small. And by the November of 2014, we found a 3,000 square foot warehouse and we moved the week before Black Friday.

22:15
So we did have, we had a one year lease on the first one, but we were like, you know what, makes sense just to go ahead and move. We need more space to grow. Otherwise we’re going to be stuck at this smaller amount. So we moved and by 2015, we were like, we still need more than 3000 square feet. So my husband and I bought this, the land right up the road. was two acres and started building our current warehouse facility. So we bought it in 2015. built.

22:44
25,000 square foot warehouse and completed that in 2016. We added on an additional 25,000 square feet by 2018. And then by 2019, we’re like, we have to have another warehouse. we bought, or we rent, we signed the lease on one right up the road. That’s 160,000 square feet. So last year, 2020 Black Friday, we were actually operating out of both and trying to like makeshift up there just for more room. But we currently are operating out of both warehouses.

23:15
Your offices are in Kentucky, right? Correct, yeah. In California, that would have been like a hundred million dollars. Oh my goodness. Yeah. Wow. No, it’s not that much here. That’s amazing. So when you were scaling also, so the way, how many skews are we talking about when you moved into that first 1500 warehouse? Like what was all the room for? Was it just inventory? Were you carrying inventory or was stuff made on demand? It was a lot of inventory for

23:43
girls to work at that time we were hiring people to come in and package orders. So they’re not doing it on my dining room table. So we had like packaging stations and we also had all the inventory stored there too. Oh, wow. Okay. So you don’t use a third party logistics firm or anything. You’re still fulfilling all of your orders. Yeah, we, we do not do three PLs. We do all of it fulfillment too. Wow. Okay. So that, can you just walk me through what your facility looks like? Is there like,

24:12
conveyor belts like amazon.com where boxes come down and you have these automated stations or? So they did quote that it was going to be about $20 million to put in. We’re not doing that. So we do have some really cool things, but we don’t have conveyor belts. We have like our inbound, know, they have, they receive the boxes, they put the way the boxes, have overflow, we have really high racking. So we, you know, we have those little things that they go up on the

24:41
whatever they’re called. then we have about, we have a day shift and a night shift. So we are operating seven days a week out pretty much, think 20, 20 something hours. They’re 10 hour shifts. So 20 hours a day, the warehouse is open. And I think that the, the skew count currently is about 13,000 skews. 13,000. Wow. Okay. Can you walk me through just like the calculations and going three PL versus owning your own warehouse?

25:11
So I, still doing a lot of deep diving into that and it’s not out of the question in the future. The hard part is with three PLs, it works very well. If you have less skews, the more skew you have, especially being more of a fast fashion brand, it’s a lot harder for them. So for us, it makes, think in the long run, makes sense to keep our fulfillment. Um, but three PLs, you know, they work very well when you have a limited skew, you know, if you’re only selling 10, 20, 30 products and you’re always replenishing those.

25:41
makes sense, but if you’re changing out styles every season, it doesn’t really make that much sense yet. So actually, I walk me through that side of the business. So once something goes out of season, are you stuck with the inventory or what do you do with the inventory when it goes out of style? Yeah. So one thing that, especially with our brand is we’re not too trendy and that we do that on that. That reason, if there’s a trend that hits the market now, but in two months it could be gone like that.

26:08
doesn’t really resonate very well with me because I don’t want to invest in something that I’m going to just toss out of my closet too much from now. You know, so like our pieces are more staple that can last for years versus it being so trendy. We do occasionally have some trends that we want to test out. But again, if you go to our site, it’s really a little bit for, we offer so much for everyone, but it’s not super, super trendy. It’s just good classic styles. But there is that case where you do have inventory that you’re sitting on.

26:37
and the trend goes out, say tie dye 2020 was huge. And then we didn’t sell it all the way through tie dye. And then the trend quickly died. So at that point, we work really hard on, you know, what kind of sales do we need to put it in? What kind of liquidation process do we need? have once a year, typically we do an in-person warehouse sale where people can come shop items, very discounted. And then the clearance as well. So we do have a clearance section on the site, sales section. And those are typically for styles that are, you know,

27:07
maybe there are 20 or less left in stock or they’re just out of season and we are not carrying them in the future. So we just want to discount them to get them out the door. When did you start designing your own clothes? Are you designer clothing designer? I’m not a designer. I have ideas, but I am not like an actual designer. So we started working with our vendors in LA and then some in China and Korea back in I think about 2018.

27:33
on our own ideas. So from there, it’s transitioned very quickly with manufacturing our own items. And we’re currently actually hiring for a full-time designer, but I’m not one myself.

27:48
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28:17
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28:46
And if you tell Steve that I sent you, you’ll get a hundred dollar discount. That’s E-M-E-R-G-E-C-O-U-N-S-E-L.com. Now back to the show. So, I mean, you’re the brains though, right? I mean, you know what’s trendy. So walk me through like, how do you design without being a designer? So I’ll look for concepts. I see things that do well within, again, it goes back to the very beginning. Like what sells well on the site? What are people loving?

29:13
and keep continually playing off that. If there is something that they love, let’s innovate it. Let’s make it newer for next year, but let’s keep the same concept of it. If there’s an animal print maxi dress that every single time we restock it, sells out. Let’s take that and let’s come up with three more animal print designs. Let’s work on that. So I see things that I like and I put them together in my head or on a horrible Photoshop. Like here’s the idea for the swimsuit, but I cannot draw.

29:43
all and I do not know AutoCAD at all. So I do work with our graphic designer here and she’ll draw prints and you know, I do oversee a lot of that with her. But we also, we know our customer pretty well. So it’s like we know what they love and we continue just to play off what they want. And so if you’re working with like a designer, I imagine it takes multiple iterations before like the stitching and this, I mean, there’s so much they can do from a picture, right? Exactly. Yes.

30:12
Yeah, there’s a lot of different fit samples and a lot of like proto samples that it takes two or three rounds. Okay. Wow. This just sounds I mean, running a clothing business just sounds so much more complicated. It is very complicated. Looking back, I’m like, maybe I should have started something else. But it’s okay. I love that because I wear clothes every day. so yeah, buddy, also, it is a necessity. And the way of the world is, you know, turning to shopping online, which is great for the future. But yeah, it is it is very complicated.

30:42
Of those 13,000 SKUs, how many would you say kind of turn over in a given year? We do four to five turns a year on our complete inventory. But in terms of like the styles that kind of go obsolete or that you’re taking down, you mentioned you had staples and then you had new styles. Of those 13,000, how many of those are just kind of staples that just lasted the test of time?

31:07
So for our staples, we still don’t always keep them in stock. We do let them run out and then restock them at the season that they are appropriate for. There’s some staples like bodysuits, if they’re long sleeves, we may not have them in stock in May and June. So we do still let them sell out at times. And so I would say 90 % of our business turns and it’s not a staple. Goal would be maybe getting it to maybe 40%, 60 one day. But yeah, most of our stuff is it turns. Amazing. Okay. So

31:37
Okay, so where we left off was you’re at $4 million. How do you go from four to 100? I mean, so what were the primary drivers for growing, you know, past, you know, nine figures? Yeah. So 14, 15, 16, we grew, you know, four to 12 million. We kind of stayed at 12 million for a year or two, just because we kept outgrowing our space and we, was just my husband and I, it was our money, you know, so like,

32:02
We reinvested all the profits, but we didn’t put additional in to continue to scale. So by 2016, we started working outside of just Facebook and Instagram. We started doing more paid ads. Influencers, we introduced those influencer partnerships, I think in 2018, which really helped elevate. And then 2019, we teamed up with a minority investor company and they really helped elevate and scale.

32:29
we started building out our teams with director level, because at the time it was still my husband and I doing most of the work. So they invested in director level positions and really those positions helped us elevate even faster. Our director of U-Com, our warehouse director, our marketing director and such. So by getting a little bit of expertise on board by 2019, that really helped us go from 30 million to 100 million within two years.

32:59
Was that just all online or was that due to, are you in retail outlets? We have one retail store here in our town and it is under a million a year. So it’s very small since we were just a college town. It’s not like a big city. So it is, it’s a very small amount of revenue. Okay. So it’s, all online sales that you scaled and it was, it sounds like it was scaled through mostly just paid advertising Facebook and Instagram, would imagine. Yeah. Paid advertising and yeah, pretty much. What’s, are you guys on TikTok?

33:28
We are, yes. How’s that going for you guys? So TikTok is, it’s great for like Legion, but it’s not great for building the community. So we are consistent on there. And I think we have about 150,000 followers. We were one of the first brands to jump on there quickly, because anytime a platform arises, I’m very quick to like make sure that our brands on there and people know about us and see us. But

33:55
people don’t respond to brands as well on TikTok. So we’re still trying to learn to navigate that. But yeah, we do have 150,000 followers. We just try to get them over to Instagram or get them to our email list. You we’ve run some TikTok ads that, you know, they go to it and it signs them up for our email newsletter. That’s a key driver to get them to actually shop. Yeah. Speaking among my colleagues, it seems like people will find you on TikTok, but you have to drive them to either your own site, get their email or Instagram to actually complete the sale.

34:24
Exactly. Yes, it is a good for Legion, but not really for conversion. Yeah. Are you guys on YouTube also? Or is it just so we have a YouTube we really pushed it last year until it just bandwidth we couldn’t keep up with keep making the videos every single week. It was really more behind the scenes on the brand side though than like product, which people love. They love seeing you know, the behind the scenes of the brand. Yeah, what is your philosophy of you personally being in the post? Are you still in a lot of the posts that you’re in either tic toc or

34:54
or Instagram? So TikTok not really, or Instagram. I mean, they’ll repost photos that I get and share and stuff, but for sure YouTube behind the brand more so and like behind the scenes stuff, but I’m not like the model. You know, we do, they do have TikTok models and, and photographers and such that. And I honestly just don’t have the time to go to all these photo shoots and do that part of it too.

35:19
Yeah, I was just wondering. So that transition probably took place once you cross like eight figures, I would imagine, right? And you could hire a whole bunch more people to handle everything. Right. Yeah, we did a lot of the live videos for the first few years and people really did enjoy, know, seeing the CEO do the videos. And I would love to do more of those live videos on Facebook. But it’s just right now I’ll leave it to the marketing team to do it. Yeah. So I want to switch gears a little bit. And I want to I know you’re a mom and you have three kids, right?

35:47
So how does one, I know we have some problems doing this. How does one juggle three kids who running such a large business? With help for sure. my, have a, our two older ones are in school, but then my two year old, has a babysitter that comes during the day. So we come into work while she is at home with her babysitter. If we ever have to travel, she’ll stay the night too. She’s great. But my husband is really good too. Like we,

36:14
We both are great parents versus it just being like the mom’s role or the dad’s role. So we tag team a lot. And if I have to work late, he’ll go home at four and let our babysitter go and like he’ll cook dinner and such. So it is a lot at times and where it’s so much at work and then you can’t get your work done and you have to do it. But I try really hard to, you know, four to eight o’clock is.

36:37
Kids time, we play, we do fast, we do that. And then if I have to finish working, I’ll do that after I get the kids to bed to complete the emails for the day. Yeah, so your kids are younger than mine. Mine are teenage years now, and I feel like I’m a full-time driver starting at one o’clock on. I can’t even imagine.

36:58
So my work hours, I work from about seven until about noon or one o’clock. And then the whole afternoon is just devoted to me being like a glorified Uber driver. Like I go to all the practices, I coach and that sort of thing. Can you walk me through your typical day? Actually, I’m very curious. Yeah. So in the morning it is wake up, get the kids ready for school, do my daughter’s hair. They just started riding the bus.

37:22
Two weeks ago, they’re super excited about it because we moved into our district so they could ride the bus. I don’t know why they begged to ride the bus. I was like, I hated the bus when I was a kid. I did too, actually. They ride the bus and they like it. So I’ll get them out the door. My husband does too. And then we play with our two year old for just a little bit before her babysitter gets there. And then I will come into work. I’m still working on, we just recently moved. I’m still working on getting my home office so I can actually work at home some. It looks nice.

37:48
Just a mile away, so it’s not hard to get here. So come in and I’m typically here every day from eight to four or eight to five depending on the day. And then go home. have right now, this is a crazy season. We’ve got soccer, we’ve got cheerleading and baseball. So every single night there is an activity for a kid to get to. Yes. And so spring, especially it’s a little harder, but

38:12
that nights are usually either driving one of them and staying at a practice or staying home with the other two kids and feeding them dinner, cooking on all that stuff. It’s nuts. from you said nine to four, you’re at work. What are your primary duties at work right now? I am over so many things. So, I basically oversee all the products. So, I’m over the buying team. We just recently hired a director of merchandising, so she’s still learning the ropes.

38:42
to work with them and demand planning to ensure we’re hitting the numbers that we need to hit on the sell through percentages on our inventory coming in. I also oversee the marketing team. So I work with them directly, the marketing director on just strategies and overall implementation for marketing. Also oversee the customer service team to ensure the CSAT scores are going up and everything that all customers are satisfied.

39:07
And then from there, if there’s ever other issues that arise or just things like today, this afternoon, going over to the warehouse just to see new things that we’re doing and dealing with some issues with new contracts for our ambassadors and influencers, et cetera. So hands in a lot of different things at all times. Tori, that made me tired just hearing you say all that stuff, actually. I do say pretty tired at night, I’m like, OK, I need to go to bed. You probably sleep very well.

39:35
I do, yes. Okay, so I want to kind of shift this last part of the interview towards people. Like, so as I mentioned before, I run a class and oftentimes people want to sell apparel. So I want your advice here. So whenever someone asks me to sell, whether they should sell apparel, I usually say no, because I think it’s just going be extremely difficult. But you clearly pulled it off on a bootstrap budget. What advice would you give people who actually want to go the apparel route? I would say,

40:04
this time and age, eight years post when I started. Total different world, obviously now with clothing and even things like Amazon fashion was not a thing when I started. So I would say the only way for it to be successful at this point in time would just find a gap in the market of something not being sold. So that’s gonna be like, if there is an idea that you have, I’ve seen great brands pop up like Viori, they sell.

40:31
Really good lounge where and such and they are huge brain that just popped up, know a few years ago, but they had that gap in the market and there wasn’t great lounge where everybody who’s staying home and they wanted that stuff so to really look to see what that gap is and you know, I agree on trends changing way too fast. I think if you go that route, you may not be successful. I would think it’s going to be much more successful if you have.

40:58
classic styles that work for people long term. And also even going into the route that we’re trying to go in the future is just having a sustainable clothing line. That could be something huge if you wanted to start out that right now. Have you guys had problems with knockoffs? Yes, absolutely. So we always have issues with that. And even as far as graphic tees and graphic designs that we do on our

41:22
ours that our graphic designer hand draws, then we see it all over Etsy a month later. So yes, we always have issues with that. What would you say like a good starting budget would be for someone new who wants to go into apparel? Do you think it’s possible to bootstrap it just like you guys did today? absolutely. Yeah. Okay. think I’m always in favor of walking before you run. You know that. And where would you start in terms of marketing? Would you start with influencers? Would you start on social? What would you do if you started all over again?

41:50
Right now I would do both. would start definitely with influencers and TikTok and Instagram, media. think that there’s still lot of life left in some of those platforms and there’s also new platforms always starting up. So a lot of women have, or a lot of boutique owners that I know have great success with both of those, especially TikTok right now. Yeah, yeah. Take some dance lessons, throw up some TikToks. Start dancing and showing them how to do great. What’s your influencer strategy?

42:20
What do you We work with a variety of influencers and we really, we ensure that we’re getting a good ROI on them though. So I mean, it does take a lot of like after the fact, here’s what they are posting. Here’s what this what’s sold. Here’s what their coupon code brought in for us to be able to rebook them. You do have to bring in a certain ROI, but our strategy it’s really it’s ever changing because the influencer world is always, always where do find them? Do you look on Instagram primarily?

42:50
Yeah, so we were Instagram, TikTok, YouTube. We work with all influencers on all those platforms. So do you give them like a trial? Like you mentioned ROI, but it’s really hard to figure out whether someone’s going to be ROI positive, right? Most influencers don’t do a trial. It’s just, they’re… So what I meant by that is do you cast your net wide and then and figure out who works and then just focus on those? Okay. I think if you’re starting out now, that’s exactly what I would do. Do you focus on the smaller or are you guys looking at bigger people or…

43:19
So for us, it’s really good mix. The ones that really drive the conversion and the sales are the bigger girls, but it’s very hard to book larger girls. And it’s also very expensive to book larger girls. I think if you take the money and split it amongst smaller ones, you’re going to get a whole lot more new audiences. And in the long run, it can be better for just that top of funnel marketing. what do you negotiate as like the deliverables? I mean, obviously you’re not

43:49
Sometimes one post isn’t enough, right? So what is your typical like minimum book for them to post for you? Usually it is just one post. one post, interesting. a session too. I mean, there’s definitely some that we do like, okay, two posts a month and two story sessions, but a lot of them like to have a variety of things that they cover on their platforms and they don’t want to just be like only showing one brand all the time. Interesting. Are you looking for ROI positivity with influencers or do you, I would imagine your repeat customer rates pretty,

44:19
Pretty good, right? Because you have a closing We have about a 74 % retention rate. OK, that’s amazing. That’s amazing. It’s very above average. Yeah, that’s amazing. So that means you can probably afford to lose money on these influencers, right? Just to get someone in we don’t, though. We make sure that we do not lose money on any of our investments. So we do make sure that we have a positive ROI. OK. So if you’re brand new, would you just recommend going after the small guys? Do you actually just give away product for the small people?

44:49
In for. In the past, yes, in the past, it’s getting harder now. It has changed so much that very little influencers do it for free product. Everyone considers themselves an influencer. These days it’s changed drastically in the last even two to three years. The way of the world in 2018 with influencer world is drastically different than it is in 2022. Yeah, OK, so that sounds like a good overview. So you could probably bootstrap with like 10 grand if you were doing it all over today. Focus on social, maybe tick tock the free organic methods.

45:18
Yeah. And then find some influencers, find out, hopefully try to just give away the product in return for some mentions and then just. Yeah. sure. And be social, create a community. Yeah. I think the community is a really big factor. I think that that’s just the way of the future with online selling overall. And, you know, people want to feel like they’re, my husband’s in this bourbon group community and he spends a lot of money in there and he’s like, I love it. I’m addicted to it. And I feel like.

45:44
people actually do get addicted to these groups and that they want to check it every day. And then they’re like, oh, well, let me buy that. You know, they get excited and they want to feel a part of a community. You know, people are spending less and less real time together. So they want to have an alternative. And that’s a community on social media. Facebook still the best place for communities or have you branched out elsewhere? I think a Facebook group is probably still the number one. Still the number one. Tori, thanks a lot for coming on the show. I know you’re a busy woman just based on your nine to four schedule. It sounded ridiculous.

46:14
Where can people find more about you, your clothing, everything? Yeah, so my Instagram is just my first and last name at Tori Gerbig and our website is pinklilly.com, Instagram at Pink Lily. So super easy, both just the names. Cool. Well, Tori, thanks a lot. I’m sure this audience will get a lot out it, especially the ones who want to start apparel companies. Well, yeah, thank you for having me. Hope you enjoyed that episode. Now, Tori’s story is super inspiring.

46:43
and she truly is an amazing person. For more information about this episode, go to mywebquaterjob.com slash episode 411. And once again, I want to thank Postscript, which is my SMS platform of choice for e-commerce. With a few clicks of a button, you can easily segment and send targeted text messages to your client base. Now SMS is the next big own marketing platform and you can sign up for free over at postscript.io slash Steve. That’s P-O-S-T-S-E-R-I-P-T dot I-O slash Steve.

47:10
I also want thank Klaviyo, which is my email marketing platform of choice for ecommerce merchants. You can easily put together automated flows like an abandoned card 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 mywifequitterjob.com slash KLAVIO. Once again, that’s mywifequitterjob.com slash KLAVIO. Now I talk about how I these tools on my blog, and if you are interested in starting your own ecommerce store, head on over to mywifequitterjob.com.

47:38
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.

00:29
wanted to take pictures with him. And today he’s going to teach us how he created this incredible brand. But before we begin, I want to thank Klaviyo for sponsoring this episode. Always excited to talk about Klaviyo because they’re the email marketing platform that I use for e-commerce and it depends on them for over 30 % of my revenue. Now you’re probably wondering why Klaviyo and not another provider. Well Klaviyo is the only email platform out there that is specifically built for e-commerce stores. And here’s why it’s so powerful. Klaviyo can track every single customer who’s shopped in your store and exactly what they bought.

00:57
And let’s say I want to send an email to everyone who purchased a red handkerchief in the last week. Easy. Let’s say I want to set up a special autoresponder sequence to my customers to pay on what they bought, piece of cake, and there’s full revenue tracking on every single email sent. Klaviyo is the most powerful email platform that I’ve ever used. You can try them for free over at klaviyo.com slash my wife. That’s K-L-A-V-I-Y-O dot com slash my wife. I also want to thank Postscript for sponsoring this episode. Now, if you run an e-commerce business of any kind,

01:26
You know how important it is to own your own customer contact list. And this is why I focus a significant amount of my efforts on SMS marketing. SMS or text message marketing is already a top five revenue source for my e-commerce store. And I couldn’t have done it without Postscript, which is my text message provider. Now, why did I choose Postscript? It’s because they specialize in e-commerce and e-commerce is their primary focus. Not only is it easy to use, but you can quickly segment your audience based on your exact sales data and implement automated flows like an abandoned cart at the push of a button.

01:56
Not only that, but it’s price well too and SMS is the perfect way to engage with your customers. So head on over to postscript.io slash Steve and try it for free. That’s P O S T S U I P T dot I O slash Steve. And then finally, I wanted to mention my other podcast that I released with my partner, Tony. And unlike this podcast where I interviewed successful entrepreneurs in e-commerce, the profitable audience podcast covers all things related to content creation and building an audience. No topic is off the table and we tell it like how it is in a raw and entertaining way.

02:26
So be sure to check out the profitable audience podcast on your favorite podcast app. Now on to the show.

02:37
Welcome to the My Wife Quitter Job podcast. Today I’m thrilled to have Rafael Snyder on the show. Now Rafael is someone who I met at the Menfluential conference run by our mutual friend, Antonio Centeno. And we’ve also hung out a couple of times, I believe at Klaviyo and also at ECF Live. Now Rafael is the CEO and editor in chief of the Gentleman’s Gazette. And he also runs a successful e-commerce business over at Fort Belvedere.

03:04
and he’s probably one of the best dressed men that I know personally. And he actually also sells handkerchiefs among other high end men’s accessories and clothing. Now, hanging with Raph is tough because random people on the street always ask for photos with him. So literally you can’t get down the street without someone like accosting him because he’s that famous. He runs a killer YouTube channel, is a master of content, and today we’re gonna find out how he’s managed to create such a successful business.

03:33
So welcome, Raphael. How are doing, Well, thank you, Steve, for such a glowing introduction. I think I’ve never gotten something that detailed. And I also realized I haven’t updated our description because I’m no longer the editor-in-chief and I haven’t done it in a while. So where did you get that from? No way. OK. Well, it’s still on the main site. didn’t realize. When did that happen? Will have worked to do, oh, you know, like we hired a content person a while back.

04:02
As you know, in the beginning, you just start on your own and you do everything and you wear all hats and then it just gets too much. And I realized that burnout and it was actually talking to Antonio. He was like, well, you’re still doing everything yourself. And I’m like, yeah. He’s like, well, I have these virtual assistants and it really has transformed my business. Was like, me more about that. yeah, I also fondly remember influential because I

04:30
That was when we really had time to talk and connect because we hung out there. think you’re so popular at e-commerce fuel. You know, there’s so many old and well-known faces that when I didn’t know you and it wasn’t like we had just three hours over lunch that we could talk. Right. So true. I really enjoyed it. I enjoyed that. again, you are constantly accosted by random people who want a picture with you. I remember at Klaviyo, I go, it’s OK if I take a picture. I’m like, who is this guy?

05:00
Yeah, it’s when you have a YouTube channel, right? It’s like I remember that in the beginning. It was a very interesting concept because we started with written content because, you know, we started in 2010 and blogging was the thing. then I remember doing surveys on the side. It’s like, hey, what would you like more content of? And in the back of my head, I was like, well, they’re going to want video. And then I got back to survey results and it was like, we want more written content. I was like, huh.

05:25
bit disappointed and then it didn’t daunt me until much later, right? If you ask a group that comes to your site because you offer written content, what they want more of, they’re gonna tell you written content. Now, I still forged ahead and we double in YouTube early on and then didn’t do it because I felt like I couldn’t do it as perfectly as I would have wanted to and that was a big mistake. I should have just said, no, just do it and don’t be afraid. Don’t

05:54
you know, let the fear take over. And so we started in, I think, 2014, 2015 to really focus on it. And it was a transformation right now. People had a face and they connected over it. And I think that was really pivotal because now we get a lot more views on YouTube than on our website, right? And if we just had kept doing the same thing, we just would have been on the website and no one would know my face really.

06:20
But this way, it’s surprising sometimes, you you go to UPS, right? you’re at the, you’re at like this, this Chinese restaurant, you know, very humble and you go there and they’re like, Hey, I love your videos. Or, you know, I’m wearing my bike helmet, you know, all sweaty and they’re like, Hey, I love your videos, Sven. You know, it’s just really cool to see that part. Of course, in the last two years that has toned down because I’m not out and about people on about you have a mask. Right.

06:49
Once Whole Foods, a guy came up to me and was like, hey, I love your YouTube videos. I’m impressed. Like you can see my eyes and my voice. That’s it, right? Well, you were probably well dressed. I mean, you stand out, right? Yeah. I like dressing and you automatically stand out if you don’t, you know, if you dress differently. It’s like, oh, who’s that guy? Actually, I was going to ask you this. I was going to ask you this later, but let’s let’s cover it now. So when did you actually start dressing nicely? My wife is actually always trying to get me to dress better.

07:19
But for me, like, I don’t know, it takes a lot of effort. So when did you get into fashion? It was, you know, not in my childhood. Like my parents didn’t pay too much attention. My dad liked more like a loud unusual things, you know, in clothes or cars or whatever. My mom, not at all. And I just got, whatever was on sale or hand me downs, really. And it wasn’t until I was a teenager, I started buying

07:48
fountain pens on eBay, like in Germany. I grew up in Germany, so I went to school there. And you start writing with a fountain pen, no ballpoint pens. That’s what you write with. And so I heard this brand Mont Blanc and eBay was pretty new back then. And they didn’t have any age limits, so I think I could sign up at the age of 14. And I bought an expensive fountain pen. And I got it and I was like, this doesn’t actually

08:17
write better than my five dollar Lamy school pen. So I sold it again and I made twice as much money. It was like, wait a second. So I quit my paperboy job and I started buying fountain pens and selling them on eBay. And that was my job. That’s how I made money. And so I would buy lots of stuff and then sell them individually. And I, I,

08:43
once got a pair of cufflinks because Montblanc also made cufflinks. And I was like, well, what do I do with that? I probably can’t sell that. And was like, oh, I need a shirt for cufflinks. Oh, now I have the shirt with a French cuff and cufflinks. What do I do next? And then I found this book called Gentleman from Bernhard Rözel. And this kind of whole world kind of opened up for me and that my interest evolved. And I was like, wow, this is awesome.

09:12
I remember talking to Antonio, so I don’t know how you met Antonio, but I was at an event, I think it was Blog World, and then all of a sudden, I had no idea who Antonio was. This really well-dressed guy that sits next to me, and he says, hey Steve, what’s up? And I was like, who is this? But he was well-dressed, Antonio’s really confident, right? And so we just started chatting, and then we became friends, and then we started talking about fashion.

09:39
And I asked him, hey, you you’re like the best dressed guy here is like, yeah, the reason I do that is because it gives me confidence and I stand out. Right. Is that like a similar thing for you at conferences and events also? Or you know, when I when I started, right, it was it came from this like interest and passion. I’m a highly curious person. And then I also just wanted to learn more about it. Reflecting now, I think it is definitely a big part of it. Right. It’s like this

10:09
when you stand out in a way you’re known for. And I noticed that when I’m in London or wherever, people come up to you and ask you for directions. And what I realized is we all judge. We are like, hey, don’t judge. We don’t want to judge, but we all do. It happens in like microseconds and we’re not even aware of it. You’re like, oh, this is a well-dressed man. He’s probably trustworthy. He’s rich. All these associations we have come through and

10:38
there is a benefit to that. Now it just happens to align with an interest. No, didn’t come from that angle. I think Antonio is much more scientifically interested in that angle. But we came from different angles, but we both fully understand the power of it. And yet when you go to a conference, right, it’s like, oh, there’s that well dressed guy that walks around, you got to meet him. Right. And so it’s very easy for people to remember, like remember you.

11:06
I see this guy, I know who he is. Ah, yes. Right. Versus if you’re just one out of many, you have to stand out in a different way. usually stand out by saying random stuff and being loudmouthed. Maybe your methods apply better. I’m guessing. You know, what’s funny though is it’s one thing to be well dressed, but it’s another thing to actually sell men’s apparel, which in my opinion is actually one of the hardest things to sell online. Right? Yeah.

11:36
I mean, think about it, every store sells men’s apparel. So when did you actually start the store? Did the YouTube and the content come first or did the store come first? Actually, the blog came first. It was a content. No, I came to the US in 2009 as an exchange student. I went to law school. I realized I hated it. I hated law. But I still came because it was an opportunity for me to come to the US and get a degree.

12:04
I had met my wife in 2006 during an exchange semester, so we got married and then I couldn’t work because I didn’t have a work permit. And I was like, well, what do I do now? It was 2009, 2010, you no one hired anyone, let alone a foreigner without work experience. And so I was like, let’s do this blog thing. And then I was like, hey, I, I,

12:32
I was like, how long does it take to make $100,000? I was like, if you do it well, about five years. And my wife was supportive of me and said, I believe in you. think you can do this. I’m going to do the day job and make some money and then we can figure it out. Was like, cool, let’s do this. And then, you know, I would write about stuff and it’s like, oh, where did you get this pair of gloves from? was like flea market in Vienna, right? Not really useful. And then I was like, well, maybe we could

13:01
create that stuff because you know in my spare time I had visited shoemakers and shirt makers and umbrella makers and it was just a hobby and was like well I already have contacts I know where I could get that people don’t so why not create something out of this and I didn’t you know I didn’t go to business school I didn’t have any business degrees I didn’t think it through and was like well what’s a better opportunity I didn’t have a community of entrepreneurs that I could tap into and I thought oh well you know I already have this

13:31
this content side and we have followers and people are going to love our stuff and it’s just going to fly off the shelf and they’re going to buy it. And I was wrong. It took us like a year to kind of just develop everything. And I remember, you know, renting space in a self-storage facility and have products in there because not everything came and I’m not a naturally good project manager. it, you know, it dragged out, but I think we first started selling in, I think 2014, but

14:00
We first conceptualized the idea in 2012 and this eBay experience I had earlier really helped me because what I realized was I liked the marketing, I liked the photography and I hated waiting in line at the post office to ship something and to pack things up. And so from the very first day, we worked with a 3PL, which I think a lot of times people don’t do, they kind of self-fulfill. And so I skipped that step because of that past experience.

14:30
And then once we had the e-commerce channel, did YouTube. And at the time, and Shopify was technically around, but it was not known at all, at least not to me. So we started with Magento because I looked at all the platforms and I was like, well, if we ever have to upgrade to enterprise version or whatever, I’m already in the same platform and the transition is probably going to be easier. And so that’s what we chose, Magento. Are you still on Magento?

14:58
We’re still on Magento. Wow. Okay. I remember evaluating shopping carts and Magento was on my list because back then it was, you know, like the standard for larger shops. But then I looked at the code and it was really hard to understand. And then you required hefty hosting and had all these little quirks. So I actually skipped, skipped Magento, but power to you. I think, you know, if you’d start today, most people will start there, right? Cause it’s just, it’s easy. It’s, it’s lower stakes.

15:27
It scales. There’s so much you don’t have to worry about. But at the time, I didn’t know that was an option. And then, know, once you’re in the system, you’re like, well, we’re doing all these things. What’s the cost of switching now? And I’m still revaluing. I’m not married to Magento or anything. But it was also like we had this good team. You know, I felt like they were really on top of things. It was really affordable. Like, you know, doing the math. Yeah. Your SaaS apps versus, you know, one time payment apps versus how much do I pay per year to maintain it?

15:57
But there’s lots of things that go into it. You don’t have to tell me that. I’m actually still on an open source shopping cart myself. I never made the switch to Shopify and it’s free. I have to touch it maybe once every five years, five to ten years to do an upgrade. So it hasn’t been that bad. I’m curious with your blog. So you started that, you said in 2012 or? I started in 2010. 2010, okay. February 2010.

16:26
How long did it take you for that to take off? I mean, you had a five year plan, you said, but did you hit six figures earlier than that? Yes, yes, way earlier. And so then we were like, let’s do this, this other stuff. Because in the beginning we had, you know, private advertisers, you know, brands in our space, like that you and value to content and the audience. So that’s how we kind of made our money early on was ads.

16:55
Okay. For a while I thought maybe, we’re going to do it like Huffington Post. And since we started with $300 each, like I put in 300 and Theresa did 300, so 600 total. think in 2011 we founded the LLC with that capital. We were like, well, yeah, we’ll, we can’t buy traffic. We can’t buy links or anything. We’ll just do organic traffic. That was the strategy, organic traffic.

17:25
And in the beginning, it worked really well because you you optimize stuff and I was like, I’ll post every day. And then I realized, you know, I’m going to burn out and let’s do, I want to be the best piece of content on this given topic I write about. In the beginning, it worked super well, but then after a while you realize, you know, your old posts lose in the sharp results. So you have to redo them or do something else with them. And then you always have some that gain.

17:55
and others that lose so net, you maybe just shrink or you maybe increase very slightly. But I think that was our competitive advantage understanding SEO early on. And also I never kind of succumb to these like short term fixes or gains like you know, because in the early days, you could really like, you game it at add more keywords to your stuff, right. And I had read about like a Sergey Brin and like,

18:24
that they modeled Google after academic journals. And the idea was that they became more important, and more often they were cited. If you’re cited by a famous journal or by New York Times, you become more important yourself. they’re like, long-term, our vision is to provide the best search results for humans. And so that was my approach. was like, if we write really good content for humans, I will never have to go back and

18:52
make all these changes that I just did for search engines but not for humans. So that has always been our approach. Now, does it mean you never have to go back and update things? No, because you know, we grow, we learn, we add questions and all that stuff. But I think overall, that helped us grow pretty quickly. So you had these blogs that were ranking in search and then you had brands advertising. You mentioned when you first launched your e-commerce store, which was the logical step, right? Because people were asking for these products.

19:22
Why did it not work out in the beginning? I think, know, our egos or my ego told me like, wow, you know, you have these thousands of people who come to your website, you know, if I look at a conversion rate of 1%, you know, at an average order value of that, I should get X. And then when you actually had the shop and it was less than that, you’re like,

19:49
Oh, you know, yeah, because these people come for content, they don’t come to shop necessarily, right. And just because they know, or I thought they would know me and know the brand and trust it. Like, that wasn’t enough. I realized, no, you actually need a really robust marketing system. And at the time we had, I’d found like Infusionsoft. Okay.

20:16
And I found a company that integrated Infusionsoft with Magento. So we had quite a bit of data and kind of, you I felt for the size of our business were quite advanced in that field with automated email flows and sequences or whatever you want to call it, campaigns. was pretty good. But I just realized too, it’s like, you know, you need to have supporting content and really kind of show people.

20:44
what they get when they buy from you and what they get when they buy from others and then let them decide. But we didn’t have like a well thought out marketing plan. know, and our photos were like white background. It didn’t occur to me that maybe the clothes should be shown on people in a environment that people would like to be in. You know, I just had looked around and was like people do white background stuff. So that’s what I have to do.

21:12
But I didn’t know, I didn’t have mentors. It was really all a trial and error. just curious though. So you had this site and you’re selling men’s apparel. I noticed you sell like shoes and stuff too, right? Was sizing ever a problem? That was a consideration we made and we did not sell shoes on the website. We for a brief moment sold them, tried to sell them offline. But at the beginning, you know, we had this limited amount of capital.

21:41
And we made some money with advertising, but it was like, man, it’s so expensive starting a product range from scratch. Amazon was around at the time. And I was like, well, as a small fish like us, we cannot compete with them on logistics, price or anything. What we can do is compete on quality. And I also felt like there was stuff that I couldn’t find in the market. And I wanted to provide that. So it was very clear that we wanted to have our

22:11
own brand, and not just slap our name on something that you could find elsewhere, but that it was unique to us and defensible. And maybe that was part of my head was always this idea of, if you do it the hard way, it’s more defensible, because people will not be interested because they want to do it the easy way. I felt long term, that was a better thing to defend. mean, what in my head, right? That’s what I, that’s what I thought. I actually 100 % believe in that. Okay. Yeah. Yeah. And it just, you know, that was

22:41
The strategy I developed there with Teresa, like, okay, that’s, think the path we want to do. And was also the most personally satisfying path, right? Like creating your own product and exactly to your specifications. It’s much more fulfilling than just buying something from someone and put something on. And I realized, you know, money wasn’t my only driver. I realized it early on because there were like, you know, supplement stuff and you could do, it’s like, you know, that doesn’t jive with me. Yes, we all want money and it’s great, but it’s not what really kind of

23:10
made me do things. I’ve, when I knew I always had this long-term vision, right? So then I didn’t care so much about, I make a quick buck here now? Because I was fortunate enough to be the position where we were, we had enough to live by, right? would remember early on with sometimes like there was this food shelf and the neighbor was like, well, they’ve all that stuff that I would use. It was like, well, I’ll go there. I’ll get the food shelf rejects. Why not? You know, like save some money, uh, can put more money in the business and stuff. So

23:39
That was no… Yeah, I was always very resourceful. Let’s put it that way.

23:47
If you sell on Amazon or run any online business for that matter, the most important aspect of your long-term success will be your brand. And this is why I work with Steven Weigler and his team from Emerge Council to protect my brand over at Bumblebee Linens. Now, what’s unique about Emerge Council is that Steve focuses his legal practice on e-commerce and provides strategic and legal representation to entrepreneurs to protect their IP. So for example, if you’ve ever been ripped off or knocked off on Amazon, then Steve can help you fight back and protect yourself.

24:16
Now, first and foremost, protecting our IP starts with a solid trademark and Emerge Council provides attorney-advised strategic trademark prosecution, both in the United States and abroad for a very low price. And furthermore, the students in my course have used Steve for copyrighting their designs, policing against counterfeits and knockoffs, agreements with co-founders and employees, website and social media policies, privacy policies, vendor agreements, brand registry, you name it. So if you need IP protection services, go to EmergeCouncil.com and get a free consult.

24:45
And if you tell Steve that I sent you, you’ll get a hundred dollar discount. That’s E-M-E-R-G-E-C-O-U-N-S-E-L dot com. Now back to the show. In the beginning, you said you were selling other people’s brands. Was that was that in the beginning or? we never sold other people’s brands. Oh, yeah. It’s always your own brand. OK. From the get go, it was our own brand because that we were like, let’s do that and let’s have just that. And then it was like, what shall we name it? And Theresa was like, well, English country house.

25:15
I was like, well, how is it connected to clothes? then Fort Belvedere is the house of the Duke of Windsor, who was a very kind of rickish, dandy, always well-dressed, most photographed of the world in the 30s, which is, know, in the classic style realm considered to be the golden era of men’s style. So was like, oh, that’s a good connection. Domain was available. Trademark was available. I went to law school, so I thought about that, Trademark. Can we do that? Yeah, for the Gentleman’s Gazette, I…

25:45
hadn’t thought about that yet quite then and then that was harder to get because they were like well Gazette for gentlemen anyhow. were your first best-selling products? I think in the beginning I had this friend and he was like well when you go to a store you don’t just want to walk in and have one product. So it was very clear for me that we didn’t just want to be a one product brand. One thing that I was

26:11
most proud of it was the most unique one. And I also think we sold the most was an boutonniere flowers. It’s like flower. I don’t have one today, but you wear it through your lapel hole basically. And I had my wife’s family, they went on a cruise and I had never been on a cruise and we weren’t there. And you know, you wear a tuxedo and black tie and I was like, well, I’d like to wear a flower, but on a cruise ship, you know, the flower selection is limited. So I once had this like

26:38
gigantic big rose that stood up straight. was like, well, that doesn’t look like in the 30s. And I was like, well, what would it take to make boutonniers that look like flowers that I could bring on a cruise? And that’s how that developed. so that was really like that market. I don’t think was super developed. It was its infancy. I’m not saying no one else had done that before, but the way we did it was really a first and we sold that well. But even there we had to promote it.

27:07
show it to people, see what’s going on. And I realized everything we sold in the beginning didn’t sell well until we put a lot of marketing behind it. as in paid or YouTube? No paid marketing. No paid marketing. Okay. Because for us, we always felt like it was expensive. And it changed so much that I felt like I had to invest so much energy in keeping up with the changes that

27:37
And in my opinion, it’s always something that people often don’t calculate in their ad spend. They’re like, oh, I’m spending that much. I’m getting that ROI and that’s my cost of acquisition. Well, how much do all these people cost that you have to be involved in this process, which is quite a bit. know a lot of e-commerce owners that spend considerable amount of time managing their ad spends and ad budgets. And I didn’t want to do that. I was like, I believe more in this organic realm. And just figuring it out, right?

28:07
Most e-commerce people, I think when they start out, they make these product videos that you would typically put in a product page that are just like explainer videos or feature videos, I call them. And then after a while, maybe, you realize, well, there’s other videos you could make, right? This like, what’s the best pair of socks, right? And where you compare stuff and understanding what actually drives sales and what doesn’t, right? Because sometimes you see these super fancy brand videos, you know, 90 minutes with

28:35
120 cuts and this emotional music and it’s you’re like, wow, this feels amazing. But then you look at the view count and it’s like 520 people watch this. Like, you know, if there’s maybe something that 500,000 people can see, right. And it resonates with them. Maybe that’s a much better sales driver than than that. And then it’s like, what are all the things we have to do, right? How much text we have to write? What kind of pictures do we have to provide?

29:05
What about social media? How can we utilize that? And yeah, that stuff. So can we talk about then which types of YouTube videos work the best for you? You mentioned best ones and comparison videos. What else is in your arsenal? I think what we’ve decided to do as we know along the way was to say, we want to create content for a core audience. But if you just appeal to this core audience,

29:35
you are kind of limited to that. So we realized also talking to Eric Bandholz and others to have like a three tiered approach, right? Top of the funnel, middle of the funnel, bottom of the funnel, and then just structure videos to say, well, what appeals to people, right? So we, one of our most successful videos by ViewCount is a video on table manners. Now we don’t sell anything related to tableware.

30:05
right or linens or anything like that. But our thought process was that, well, a person interested in table manners will likely have an also there’s a chance that they’re also interested in what we do. So we look for that kind of correlation, right? And then a middle of the funnel video could be something like, you know, best wallets for men, right? Something like that. And then a bottom of the funnel video could be very specific, you know, like

30:34
how to identify the quality knit ties, something like that, right? So you funnel it. And sometimes you think a video is a certain funnel and that it turns out to be very different. One thing we notice is like, if a video sparks curiosity, that’s when you hit the jackpot. Because YouTube basically, they’re based on numbers. So they look at what is the click through rate from the thumbnail. So it’s like,

31:03
How does a thumbnail look? And what is the title? And then what is the average watch time of the video? Not just on this one video, but how many videos are people gonna watch? Not just on your channel, but overall, because the longer they can keep people in the platform, the more money they make, the more interested they are in showing it. And so when you look at that and analyze that, that really helped. And YouTube provides a lot of information where you can look at your audience retention and you can see, oh, when I say this,

31:32
there’s a drop when I say this, people watch it again, right? so you can say with your thumbnails, you can like, I’ll do this. And this is my click through rate. I’ll do that. And that is my click through rate. Sadly, you can’t A, split test, but you you do what you can with a platform to figure out what works and what doesn’t. I think- Share with me one of these titles that create mystery that’s worked with you. Do you have any in the top of your head that you remember?

32:02
Yeah, like for example, we did a series called, you why did men stop wearing hats? Right? Why, why, why that? And that’s just something that’s really curious for people. I think for e-commerce people, I’ve, you know, if I meet someone in e-commerce and they’re like, well, we’re thinking of getting into video. I just say, go through your customer, look at the hundred most asked questions they ask, then make videos about that. Right?

32:31
Don’t make a product video about the features and stuff. Just look at what do your customers do and what’s happening. And lately also it daunted on me, we always have the tendency to say, well, we want a lot of people to watch our videos and that’s great. But actually what can happen is it can be really bad for your channel. So there was this lady, she this DIY channel on YouTube and on average she’d get about 150 to 200,000 views on her videos in the first week. Well now,

33:01
COVID hit, she made a video about DIY masks, right? We’re like, well, DIY, know, masks super popular right now. So the video blew up, super successful. Well, now subsequently, when she brought her regular DIY videos out, people started, YouTube recommended those new videos to the audience who also watch a DIY mask video. They’re like, nah, I don’t care for that. So then YouTube sees extremely low click rate. Oh, people don’t like that.

33:31
And now she only gets about 20,000 views on a new video in the first week. So I think when you develop a strategy on YouTube, you have to understand that maybe people want you to stay in your lane. Right? I think we did once a video where, you gentlemen’s because I do gentlemenly things, we talk about etiquette, but then we talked about steak. Right. And because I was like, well, men like steak. Let’s do a steak guide.

33:59
But realistically, people don’t come to us for steak advice. The audience you groomed now is mistaken like, what is this? Am I a cooking channel? And then they drop off. I think that’s a if I could avoid one mistake on YouTube, that would be it. story is just like my buddy. Okay, he runs a personal finance channel.

34:23
And during the pandemic, he started talking about stimulus checks, that’s where all the traffic was, and he was getting millions of views. But then now that the stimulus is over, those people aren’t watching any of his other videos, different demographic, he targets like investments, people with money. And you’re right, that that totally destroyed his channel. Yeah. But it’s sometimes this short term versus long term, right? And so we naturally always kind of had at the back of our mind, who is the person we’re talking to? What do we want? You know, what do we want?

34:52
And so that helped us kind of state a path and not jumped on these shiny objects like the stimulus checks were like, right. And we all like intuitively these like big opportunities, know, blue ocean kind of thing. I think sometimes like staying the course and being true to you can really help. Same with the thumbnails, right? It’s like there was a time when these like crazy rainbow thumbnails were super popular, right? Like, well, how does that jive with our brand?

35:22
Right? Like it doesn’t. And what I realized too, through like Eric Bandholz in all of that, the strongest thing we have and can develop is the brand. Otherwise we’re just commodities and someone comes in and, know, sells it for less or whatever. But so in the back of my head, I’m like, you know, Ralph Lauren, that kind of visual identity brand that he created where people are like, I want to be like that. I live in that house. That is just much more defensible than.

35:51
if you are just, you know, a supplier of ties or pocket squares. And in the beginning, I thought, well, you know, let’s do a lot of ties in three different lengths. In reality, there’s lots of ties out there. So it’s much harder to sell it than maybe, you know, a special set of pocket squares or something like a boutonniere where there’s just not as much competition out there. And I think I like that. never liked fields like, know,

36:19
personal real estate where I feel like there’s so many people competing in the pool and it’s people to try to outdo each other by working harder. like to be kind of a big fish in a small pond rather. So for your YouTube videos, and I think I asked Eric Banholtz this question, do you have a way of tracking people or is it just an uplift based on, you know, when a video

36:47
hits, you just naturally see a correlation in sales. Yeah, no, that’s a good one because that was always, you know, one thing that kept me from like wanting to spend a lot of advertising was like, well, how do I know the attribution? Because what I saw was like, you know, well, I sold $100,000 worth of stuff. But if I add up all my attribution, I sold $300,000 worth of stuff. So I was like, well, I didn’t, I only sold $100,000. Everyone claimed

37:17
credits for everything 100%. Well, that’s not how life works. And then we found this thing called, I look at different attribution platforms, and we found like wicked reports. So we did that and we got it early. we pay a nice price. I think it’s not more expensive now. But the concept behind it is like that you basically add UTM parameters to everything. Because on YouTube,

37:47
you know, people will likely just click through, click through cards, click through a link to the description or, and that way you can really have a better click attribution. So that now there’s, think, more sophisticated solutions in the market where they’re like, well, we use click data, we use view data. And if you have a video that goes viral and we see a correlating spike in sales, then we attribute that much to it and stuff, right? So, yeah, I always liked that attribution.

38:16
So we now on our back and say, well, we produced this type of content and this is what happened. But all the people like to always focus on the sales, right? It’s like, oh, how much it sell. But I also realized, well, there is, you you have these micro conversions where it’s like, maybe they became a subscriber, right? Maybe they became a subscriber on YouTube. Maybe they just, you know, came back and watched it. And even if they can’t buy right now, they tell a friend about it. So to me, there’s

38:44
more success than just how much they sell. And for us, it’s also like how much advertising does it generate? But then also we have a value of like, does this further our brand and brand value? So if we do a video about, let’s say, what it means to be a gentleman today, and even if this video had minimal amount of views, no sales, I would still consider it a success in the sense that we foster this kind

39:14
culture that our brands stand for. And I think that’s important too and brand building probably. And I think one thing that I’m proud of what we’re doing is that we’re not just analyzing the market like, know, SEO analysts and saying, well, what are all the things that are out there? We’ll do what’s best and try to outrank people or create skyscraper content, but that we actually sit back

39:43
with people who love this passionately and say, what would a person really want? And that allows us to create innovative content that wasn’t around before. And someone you hit a home run where you didn’t know it existed, right? Because no one else talked about it. And you just created something and that, I think people over the long term will notice, right? If you see the sixth video about…

40:12
confidence and why you should do this or that, right? And just spun in a different way. think Antonio has like four videos on how to roll up your short sleeves, for example. I mean, he’s been doing it a long time. He’s got variations of everything. Exactly. But they’ve, they’ve been super popular, right? And that’s great. And we’ve done a redo of a how to fold the pockets for video because we felt like, you know, this is so old, this could be a lot better. Let’s, let’s do it. But I’m like, I don’t, I was like, Hey, I’m, I’m proud of

40:42
doing something new, right? And other people are like, oh, they did this was successful, we’re gonna do it. And that’s okay, right? I’m not like, I had this idea, our team had this idea, and we own this. I’m like, yeah, you know, someone else can just pick it up and make a better video. And that’s cool. And I can do the same, right? We’re all it’s an ecosystem. But we, we try to not just look at the numbers, but also look at it from a brand and individual perspective. Yeah.

41:12
And it sounds like you’re able to spot trends before they become popular, right? So that you’re essentially like the pioneers once it does become a mainstream. Yeah, I mean, I think we are realistically, we are a niche content. think none of the stuff we do is really mainstream. So I don’t really look at that too much. You know, it’s like, as long as are stopping on the streets. So it’s kind of mainstream.

41:38
Okay, okay, okay. I know what you mean. Yeah, yeah. Okay. I see what you mean. Yes. Yes and no. I’m like, you know, if we talk about attache cases, you know, I don’t think attache cases will ever be mainstream or like, what head fits your face shape, you know, like fedoras are not mainstream. I don’t believe they’re going to be mainstream. But I believe there’s an audience that we can serve that right.

42:04
then you’re like, oh, people who like fedoras are also interested in ascots, you know, stuff like this. Sometimes people who like to dress in a special way, right? Are interested in those unusual accessories, for example. So like, okay, let’s, let’s focus on that. Then of course you can have something like socks, right? Everyone or the market for socks is a lot bigger than the market for a boutonnier or maybe even pocket squares, right? Cause the pockets were for most men, it’s like a

42:33
celebratory thing, you know, if my wedding, I want my pocket square, my hand could shift. It’s not like they wear that every day with socks. You have the opportunity that someone potentially wears it every day. And I think, you know, when you talk to like business analysts, they’re like, well, do you have a subscription product? No. Do you have a consumable product? Well, kind of. But with a brand, right, if you build your brand on like quality and longevity, that kind of goes against that.

43:01
But we’re like, we still like that. And maybe there opportunities to do, you know, consumables like, you know, the razor companies or whatever, where you’re like, Hey, you new blades, right? Every deodorant companies, all that stuff. Maybe we’ll have a gentlemanly deodorant, right? Where we’re like, we really like that. We like the sun profile for that reason. And even Eric from Beardbrand, you know, they started with beard oils, well, now they have hair products and soap and things that are

43:31
accessible to everyone, not just people who are into beards. I’m still sure that they sell most of their stuff to people who have some connection to beards, right? Yes. My wife is looking to say, Oh, let’s buy soap from Beardbrand, unless she maybe smelled it and was like, this is amazing, right? And I want that. But at first, it’s like, that’s not for me. I’ve done it a beard. Like, why would I buy a beard brand soap? Has your YouTube channel revenue? I don’t know what the revenue breakdown is, but

43:59
I assume you make more from the e commerce than you do just YouTube revenue. Is that accurate? Absolutely. Yes. Okay. Make about 25 % from ads. You know, there’s website ads, there’s YouTube ads, and then there’s website revenue. Now, that being said, you know, it’s, we can definitely see a change in what is called RPM revenue per thousand views. Yep. It’s definitely going up. And personally, I think, you know, looking at I don’t know,

44:27
TV ads and what people pay there and YouTube what people pay there. I’m hopeful that in you know, five, 10 years from now, RPMs on YouTube will be a lot higher. And of course, if you are a main player there, and you can, you know, get the higher RPMs, and you can increase your audience and your footprint, I mean, that can lead to massive growth. And of course, that kind of revenue is, you know, there’s no

44:57
returns department. There’s no customer service. Yeah, that’s what I was getting at. Like if it’s big enough, would you ever consider just becoming a media mobile, you know, on YouTube as opposed to I, you know, I like my vision is that we are a brand that creates high quality stuff for gentlemen, not just in the clothing world, but I’m also thinking about having a nice Chesterfield sofa, right? And becoming a lifestyle brand, not for women, like

45:25
just for gentlemen in that style. That’s just something that I would find personally satisfying. So it’s something that I would drive to and I would use the revenue that I generate from the content to make that a reality, right? One of my kind of goals is not like, oh, I want to make $2 million or whatever. But it’s like, I want to host a party at the Rosecliff Mansion in Newport, Rhode Island, where people can all come and dress up and then learn from each other, hang out. And that’s something where I’m like,

45:56
that would get me really excited or how about, you we rent a cruise ship on the Nile that, you know, Agatha Christie’s Poirot was on and we do something like that, like events and maybe we bring tailors and that’s something I’m like, I want to do that. I’m not like, I just want to see where I can make the most money and do that. I’m well off. Can I always make more? Sure. But do I want to increase the channel and build a team? And yes, I do.

46:25
but not just so I can make easier money or money more quickly. So the answer is no, I would not say I’ll just become a media company because that’s where all the money is. Well, no, the reason why I was asking, I e-commerce, I use 3PL, so I guess it’s less. But, you know, there’s a lot more things to worry about, Absolutely. I mean, I don’t know what to do, but I like the, you know, the complexity of figuring it out.

46:53
Again, I always did mindset of, know, if it’s too easy, it’s easier to replicate. So if it’s more complex process, it keeps out all the amateurs, right? I felt like that about YouTube, for example, I was like, when I started Facebook was still popular and you could get a lot of organic traffic. But then, you the barriers to entry were low with Instagram, right? How many menswear Instagramers are out there? A lot. Because what’s barrier to entry, you need a phone and a filter. And that said, well, with YouTube,

47:22
to make consistently good videos, you need the gear, you need the people to edit and put it all out. So now you’re talking there’s a competitive pool of 20, maybe the largest sense, right? So I always like that being among fewer and not trying to flip houses, right? Because it’s just, yeah. Yeah, I totally agree. This is why all those ecommerce business models out there that are

47:51
that appeal to most people, they’re easy, but because they’re easy, they’re actually hard. In the long term, right? Easy to get in, then to kind of stay in there, remain successful, building something, that I think gets much harder. And that’s why I like it, right? It’s like, okay, like if you want to do YouTube well, consistently, I we have a huge…

48:17
expense around that. That’s our marketing expense. Most people don’t think they think marketing and ecommerce, they immediately go to paid ads. And we’re different. like, no, for us marketing is everything that we do to bring the product to market, which for us is just that content basically.

48:38
Cool. mean, that’s the way to build a brand. I mean, many ways though, pay-per-click is faster, right? I you can just drive traffic right away. Whereas your content method is more of like a slow burn, right? A slow ascension. Exactly. More solid foundation. Yeah. And we also look at videos, and sometimes you videos that just are really strong out of the gate and then they stop. And then there are other videos, you you start, they’re just like slow burner.

49:08
but over time get you all that, you know, traffic attention and brand recognition. And I mean, if you look back, right, mean, Ralph Lauren didn’t make content and create great brand. There’s lots of brands that didn’t create that content. It was just one avenue that was available to me and I kind of liked it. I’m also a bit, you know, bummed. I think I just never figured out how to do paid ads. I think there was a time when if you figured it out,

49:37
we could have grown much faster and done things differently. So I’m not saying, you know, paid ads are bad and, and you shouldn’t do them. I’m just like, it didn’t work for us. I didn’t, I, I felt like this was more in my wheelhouse. And I think when you talk to different people, I was at e-commerce, everyone figured out an angle that worked for them. know, some people are really active on Reddit. Other people are really active in a forum. Other people do this. Right. And I’ve,

50:06
I’ve met anyone who’s like the gorilla on all the platforms, right? Some people do podcasting and they love it and it works really well for them. And I, you know, I’ve thought about podcasting and was like, nah, the barrier entries are lower, right? What do I need? A focus right box, a nice microphone. It’s easier to sit down. And it’s also probably because I personally don’t listen much to podcasts because I don’t like commuting. Then I’m not, you know, I don’t…

50:36
naturally think of it. But I realized there’s an audience on every platform. There’s people who like clothes, who love podcasts, or videos or Instagram accounts. It’s not this like, oh, people who make that amount of money, they don’t watch YouTube videos, or they don’t listen to podcasts. I don’t think that’s true. I think you can find people everywhere. And it’s just what jives with you and your channel. And I think if there was one new channel we’d focus on right now, it would be linkedin. I feel like that

51:06
drives the most with the kind of person that, you know, we may be looking at. It wouldn’t be like tick tock, you know. And sometimes or it’s funny when these new trends come along like YouTube shorts, for example. We haven’t made a single YouTube short video yet. And it’s it’s interesting when you talk to other people who’ve experimented with it and you know, YouTube obviously recognizes Hey, this is your channel. I don’t think it cannibalizes the overwatch time you have. And maybe we’re losing out. But it’s like

51:36
And it’s a bit more, you know, it’s just like dopamine rush, right? One minute short video. And I’m not saying we’re never going to do that. So far, it just hasn’t fit into our brand strategy. So we skipped that. got to your dance lessons first. What? You’re not done taking your dance lessons. Right? Well, yeah, yeah. But it’s maybe it’s wrong. know, like, there’s always this opportunity. And there’s so much opportunity, right? Oh, I could do attentive.

52:04
text message marketing, right? Or I could do use Klaviyo, I could do this, I could do that. could do and what I noticed is like, I’m actually better off a focus on one thing. absolutely. Figure out and do it right. Rather than trying to dance everywhere. Not well, because I don’t know all the dances. That’s actually great advice for anyone listening. Hey, Rafael, it’s a pleasure having you. Where can people find you if they want to know more about your business?

52:34
Gentleman’s Gazette dot com or on YouTube. I mean with the links out there. I think you know we do something on Instagram. We’re not on Twitter really Facebook a little bit But yeah YouTube and then our website is the bread and butter of what we do. Yeah And you can usually spot Rafael on the streets. He’s usually wearing a nice jacket. Maybe an ascot fedora maybe You know actually fedora’s I noticed I

53:03
I got a lot of breakouts. So when I wear fedoras for long time, I get like zits all over. I’m not a… Preston here, Preston on our team, you he wears a hat every day. It’s just how he jives. And I think I’d like the look of it, but it just doesn’t work for me in that sense. I also, you know, I also wear, I mean, I bike my daughter to school. So I wear like boat shoes and shorts and a polo shirt, right? I’m not, I always wear this. And we just, think we’re producing a video.

53:32
I don’t think it’s quite out yet, but what do we wear at home? What do we actually wear? It’s not like this. I always have to do that, but I enjoy it. I’m like, oh, what time I’m to wear, what shirt, what jacket. And I enjoyed it. I have to say, with COVID, I definitely noticed I did not wear my tuxedo at home, a black tie. It was more like I wore a pair of corduroys and a shirt and a cardigan.

54:02
I don’t have sweatpants and hoodies in my wardrobe. you have a t-shirt? don’t think I’ve… I’ve had a t-shirt like when I work out, know, I have t-shirts, but sometimes I’m also like using an old polo shirt for it or know, stuff like that. I don’t wear t-shirts to anything but a workout. Yeah. Really? Because they’re like, well, I could wear a polo shirt instead, you know, same kind of functionality. I like that more, so I wear that.

54:31
Cool, Rafael, I appreciate your time, man. It good chatting with you and I’ll see you in just a little bit, actually, in person.

54:39
Hope you enjoyed that episode. Now if you want to start a men’s clothing brand today, you pretty much need to be creating some form of content to build an audience. Now doesn’t have to be on YouTube. It can be blogging, podcasting, TikTok. Just pick your medium and stick with it. For more information about this episode, go to mywebquaterjob.com slash episode 410. And once again, I want to thank Klaviyo, which is my email marketing platform of choice for e-commerce merchants. You can easily put together automated flows like an abandoned card sequence, a post purchase flow, a win back campaign.

55:07
Basically all these sequences that will make you money on autopilot. So head on over to mywifecoupterjob.com slash KLAVIYO. Once again, that’s mywifecoupterjob.com slash KLAVIYO. I also want to thank Postscript, which is my SMS marketing platform of choice for eCommerce. With a few clicks of a button, you can easily segment and send targeted text messages to your client base. SMS is the next big own marketing platform, and you can sign up for free over at postscript.io slash Steve.

55:34
That’s P-O-S-T-S-U-I-P-T dot I-O slash Steve. Now I talk about how I these tools on my blog, and if you are interested in starting your own eCommerce store, head on over to mywifequitterjob.com and sign up for my free six day mini course. Just type in your email and understand the course right away. Thanks for listening.