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246: Case Studies: The Scaling Series, Part 5

Posted by Austin Brawner on April 7, 2020

 

This is the final part in our Scaling Series and we’re talking about some hugely successful brands.

In our previous episodes, we covered zero to launch, launch to traction, traction to scaling, and growth mode, which will take you from the stages of just starting out to making somewhere between $12 and $15 million.

In this episode, we’re diving into specific case studies of brands you’ve probably heard of, like MVMT Watches and Native Deodorant, and talking about why we think they were successful and why they were able to grow and scale up.

We hope you’ve enjoyed this series, whether you’re just starting out or close to making an exit.

Episode Highlights

  • 4:07 What MVMT, Pura Vida, and Blenders did that made them special. 
  • 6:23 The huge significance of the first-mover advantage.
  • 9:12 Taking advantage of upselling and cross-selling. 
  • 10:28 The overnight success of Native Deodorant.
  • 11:22 Native’s checkout process and what makes it so great.
  • 13:27 The power of subscription at scale.
  • 16:43 How Tuft & Needle scaled to over $100 MM in mattress sales.
  • 18:02 Why being a copycat business really doesn’t pay off.

Links And Resources

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Transcript

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Austin Brawner: What's up, everybody? Welcome back to another episode of the e-commerce influence podcast. My name is Austin Brawner.

Andrew Foxwell: And I'm Andrew Foxwell and we are here with a final part in the scaling series, part five.

Austin Brawner: Part five. We are fired up today because we're going to be talking a little bit about a breakdown of different case studies.

Now, if you have been following along, we said we have five parts in this scaling series. You can start at any one of these episodes, but if you haven't listened to one through four, you can go back. We talk a lot about zero to launch in the first episode, launch to traction, traction to scaling, and then what we call growth mode in the previous four. So that's kind of the whole range up to about doing somewhere between $12 and like $15 million, zero to that range.

In this episode we are going to be diving into specific case studies into more the visible brands that you guys have probably heard of and we're going to talk about why we think they were successful and why we think they were able to grow and scale up.

Andrew Foxwell: Yeah, and that's exactly what we're going into. I think it's important to mention that for this we have a list of a few, but we also didn't really take notes to outline it on purpose because I really want to give you guys a little bit more of an inside look of what it's like when Austin and I are brainstorming and talking through these things and outlining these podcasts episodes.

Normally, we go through and work on the outline quite a bit and make sure that it's coherent and make sense, but in this one, I think the conversations that we have ... I mean, I personally enjoy the conversations that we have. And Shane, our podcast editor, always talks about how he likes the stuff that is after we've recorded, that's always the best. 

Austin Brawner: The inane ramblings afterwords.

Andrew Foxwell: Well, I wanted to give an idea of like the realistic talking because I think sometimes podcasts can be, ours isn't too bad, but I think it can be a little routine or rote and so, I want to get a little more relaxed and-

Austin Brawner: Polished.

Andrew Foxwell: Yeah, polished.

Austin Brawner: Get that grit.

Andrew Foxwell: Let's talk about why some of these companies were successful and let's talk about the ones we talk about a lot, which is I would say Blenders, Pura Vida, MVMT. Do we want to lump them?

Austin Brawner: Yeah, let's lump those in altogether because let's start with the question that both of us get. I think I've answered this question pretty much every time I've done a conference or some sort of a live event, which is, what did MVMT, Pura Vida, Blenders do that made them special, and how can we do it?

Andrew Foxwell: Right. I'm going to answer from my personal experience on what I know, and I'm going to start with talking about Blenders because they're the one that I worked with the longest.

For me, I think one of the things that they did right out of the gates is they really understood their customer in terms of like going to the beach and selling sunglasses on the beach to people. They understood what they were looking for. They understood the price point that they were looking for. They understood the styles that people were looking for and what made them different and interesting, and they understood what kinds of new styles to continually introduce to make sure that they had like a big loyalty play right out of the gates.

That to me is a big part of it. I mean, obviously the Facebook stuff, which we'll get to, and Facebook ad stuff but that's a big part of it. A lot of the product and research focus was, from them, relentless, I think, in the way that they went about it.

Austin Brawner: Yeah, I'll lump all of them together and talk about something that I think was really important, which is it's easy to communicate what they're doing, right? It's easy to communicate what the product is. We've got to think about, there's a huge advantage with that. They can tell their story to other people and then that other person can tell the story to somebody else and that other person can tell the story to somebody else in a very simple and clear way.

Let's break those stories down. Initially, Blenders was selling quality sunglasses that don't break the bank, I think that's their tagline. MVMT was like, "Quality watches cut out the middle man." I think something like that, watches that are without an insane price point.

Andrew Foxwell: Watches that don't tell time. It was really futuristic.

Austin Brawner: And then, Pura Vida was talking about the story of creating jobs for customers.

Andrew Foxwell: Yeah, there's a social component for sure.

Austin Brawner: Social component.

Andrew Foxwell: Yeah.

Austin Brawner: So, very easy to pass on that story. And then one thing that cannot be separated from this is they all had a first mover advantage on social media.

Andrew Foxwell: Yeah, they did. And the social media both organically and in terms of back in the days when your organic posts would get 50% reach without paid promotion and then ads too. Facebook ads were a huge part of it.

Even going in the length of that of the business, I think, I know for a fact Blenders is still incredibly profitable, I think that, that's important to mention, right? Even with rising competition, is my point.

Austin Brawner: Yes. The question in my mind here is people are more looking at, "It's a copycat, it's a copycat space. Everyone's trying to copy other brands, especially brands that have been successful." And they're always looking for like, "What did they do so we can do it?"

It's always important to remember that the first-mover advantage on new platforms is real and if you can build a big audience and understand how the platform works and maintain a tight viewpoint on maintaining your brand integrity, that makes sense. Being native to a platform and making sure that you're not just selling on it, but also interacting with the platform in the way that it should be interacted. That's something that all of them did.

Andrew Foxwell: Yeah. I think that they also all went as quickly as they possibly could to new channels that even held a lick of promise, an ounce of promise. I don't know why I said a lick, is that a thing? An ounce of promise. I remember when Pinterest came out and getting an email from one of them, I won't mention, of blowing me up like 50 emails asking about Pinterest.

I think it's the same with some of these people we've talked about now who are not in this category, but we've talked about clients we work with now that they are taking advantage of new channels and they're obsessively going about it. That's a sign to me of true growth and scalability, is that you are going to try it.

Austin Brawner: Yes. And if it doesn't work, also be willing to shut down your dogs.

Andrew Foxwell: Right. I love that phrase too.

Austin Brawner: Let your winners run and just shut down the dogs.

Andrew Foxwell: Oh, I thought you said, "Let your windows run." "Let your windows run and then shut down the dog." Just tons of phrases here that it's like a British talk show now.

Austin Brawner: But no, that's something I think that separates them. And again, simple products, all of them.

Andrew Foxwell: Oh absolutely. I think that, that's huge.

I also think that on top of it, they also were early in the game of launching Pura Vida, for example is early in the game of launching a really legitimate subscription business that I thought was big for them in terms of why they were able to scale.

I also think that they all had Facebook ad and Instagram ad buyers that were good at strategically understanding how to integrate product selection for constantly upselling and cross-selling. I would imagine, I don't know this to be true, but if you ask somebody who owns Pura Vida, like a Pura Vida bracelet, they probably own 10. Same thing with Blenders. They probably own four pairs of Blenders.

Austin Brawner: Yes.

Andrew Foxwell: You know what I'm saying? And so that was a huge part of it, of taking advantage of cross-selling and upselling opportunities. I think it was really big. I also think that they were creative in terms of how they created creative. So, they were the early people that did testimonials in ads. They were the early people that did emojis in reviews and ads like their star emojis, which are banned now, but you used to be able to do them.

What I'm saying is I think they really took advantage of a lot of the early sides of things and just move quickly.

Austin Brawner: That's going back to figuring out and following and investing in the brand and being like, "Let's find out who's doing cool stuff, bring them on board, learn what they're doing, and invest in it."

Andrew Foxwell: Yeah.

Austin Brawner: Let's move on to some other companies that people might know here. Let's talk about Native Deodorant. Native Deodorant's a company that a lot of people are familiar with because of its success. One of those that's a seemingly overnight success that was probably as fast of a success as I've ever seen, but still involved a lot of work and involved a lot of understanding about the customer to be able to have that success. If we compare it to some of the other brands Native, again, a very simple product.

Andrew Foxwell: I know, and simple brand.

Austin Brawner: Simple brand as well.

Andrew Foxwell: Simple design. That's to me is a huge part of their growth for me, it's just so simple.

Austin Brawner: Yes. I think the key is that it solves a clear need, and again, it was very easy to communicate, right? Deodorant that's not bad for you.

Andrew Foxwell: Done.

Austin Brawner: Yeah, simple.

Andrew Foxwell: Totally. The things that people are using deodorant every day. Also, shout out to Native for making the world less smelly.

Austin Brawner: Shout out.

Andrew Foxwell: Shout out. But the thing that is insane about that is they looked at it and they saw this was something that clearly people were going to talk about. And I would imagine they were probably surprised by that amount of scale because the choices for the consumer up until that point were like not that many choices. It hadn't really been disrupted. So, I think another being disrupted early of a certain category is a big one.

Austin Brawner: Sure, sure. The thing is they're not the first, right? Tom's was way earlier in deodorant.

Andrew Foxwell: Oh, Tom's deodorant, it was.

Austin Brawner: It's been around for a long time.

Andrew Foxwell: Oh, that's right, the white one. Yeah, yeah, yeah, right, right. Tom's of Maine you're talking about.

Austin Brawner: Tom's of Maine. They'd been there, but the difference was going direct to the consumer. That was the first time they've done that, advertising the price point.

What I find so interesting is that they were able to, if you go through the checkout process, that checkout process is designed to take a low average order value product and maximize it throughout the entire, that was the strategy. How do we sell something that might struggle to find traction on Facebook unless we can increase the average order value as much as we can?

That whole checkout process, you add one, they offer to add some other products to your bundle, you may take an upsell. If you buy his, they'll offer you hers. If you buy hers, they offer you his.

Once you buy, you then get upsold travel deodorants, all these different components, and then they roll the other products as well. Kept it really, really simple and we're able to grow really, really quickly.

Andrew Foxwell: A couple of things to mention on that, one is the thing that you said of an example, one of the examples we've been talking about, a current client we both work with, you kind of took a component of the Native site of their subscription business and you helped this company build a similar thing. And already that guy has 18% of his people coming through the site are now choosing subscription. That shows the power of that at scale, right? That's amazing to me.

Austin Brawner: 100%. What's interesting is that if you go through the Native checkout, their goal is to get you on subscription, right? It's defaulted subscription and it's defaulted subscription with something that people are naturally inclined to subscribe to. Super important to remember, right?

Andrew Foxwell: Sure.

Austin Brawner: Because just defaulting to subscription, it doesn't matter. Going through that exact same thing with a client where we were questioning everything, we're like, "Why is it not default? If this product is better, it's a replenishable that it's better when people have multiple like versions of it, not version necessarily, but do it for a long period of time. Why don't we default to subscription and make it an offer, a Godfather offer, an offer they can't refuse for this subscription?"

And that made a huge, huge impact by just thinking in terms of, "Let's make this thing just a no brainer."

Andrew Foxwell: Yeah, Native, it's pretty cool. I think you're right. And going back to what we said before, Tom's of Maine being the first, that was good, you reminded me of that. But the thing about Tom's of Maine versus something like a Native, in my opinion, is that Native marketed itself in a brand that was simple and more millennial-focused.

Austin Brawner: Yes.

Andrew Foxwell: Right? My business idea that I'm telling everybody on the air, so feel free to steal this idea, is right now Culligan will deliver salt to your home for your water softener.

Austin Brawner: What is Culligan?

Andrew Foxwell: Culligan is like a water service, so they'll deliver pellets. Your choices for getting pellets for your water softener are Culligan or to get them at the gas station or like a home improvement store if you need a water softener in your home, which in Wisconsin you do, no idea.

Austin Brawner: I think it's a great business for you.

Andrew Foxwell: Yeah, nobody's doing this.

Austin Brawner: I don't want to do it.

Andrew Foxwell: What I'm saying is if you were to just take this business and you were to create a different brand that separates it and make it millennial-focused, even by doing that sometimes I think can be a key to growth.

It's something people already know that they need. It's an established need in the marketplace. People are going to need deodorant. But they took that, they created a better product they created that was naturally made, that was better for the earth, that was better branded, and made the checkout process simpler. You can see how it worked out to help them grow.

Austin Brawner: Sure, sure. And you know, again, it's very interesting. We want to have Moiz in the show and talk to him about it and hear directly from him because it's interesting doing the breakdowns.

Andrew Foxwell: First of all, scaling and growing is super easy, everybody can do it.

Austin Brawner: It's an interesting breakdown. I want to go to another one as well, which we've had on the podcast. Tuft & Needle, interesting company, they are doing over $100 million in mattress sales.

Andrew Foxwell: I think a lot of it is, I think they did have first-mover advantage as well. I think that they were one of the early brands, if not the earliest, they had a superior product, and they made the process of buying a mattress incredibly simple. And they had a Godfather offer like every other mattress brand that matched them with a 100-night free trial. Previously to that, what was the model? 

Austin Brawner: A frustrating model. Going to a mattress store, some guy's trying to hard-sell you all these different things. Yeah.

Andrew Foxwell: And so, I think there's a lot to say there in terms of what they've done in terms of growth and how it's helped them grow, which is customer experience, customer loyalty and retention, letting you know we have a Tuft & Needle mattress and love it.

I think they've had a very simple approach to it as well. They make it so you get it in your house, your home, you know you're going to like it.

Austin Brawner: Why are we talking about this? I think I want to bring it back to why we're talking about this I think that the reason we're talking about this today is because we want to get real about what your business is, what it isn't, and how to do a better job of differentiating your business from everybody else out there. Because being a copycat business doesn't pay off that well, it really doesn't.

Andrew Foxwell: It's not going to scale.

Austin Brawner: Yeah. And the idea, what does it mean to scale? What are all these things? Why are we talking about this?

The reason we're talking about this is because in a lot of people's minds that's what success looks like, is growing a business and making it bigger than what it is and potentially having an exit down the road down the road creating a really great cash flow business. But I think a lot of people in their mind have an idea of an exit.

The reason we're breaking these down is just to show like a few of the commonalities. If you're not starting with a product that is unique, that can be communicated clearly, that is simple. In this space a lot of really large successes that we've seen have these things in common and they've used some sort of a demand generation tool like Facebook, they've been first movers.

So, basically the point is don't try to go out and copy what these guys are doing, take the components of what they did, translate them into your own business, and create your own formula for growth. And that can be your own rocket fuel that takes you where you want to go.

Andrew Foxwell: Yeah, I agree completely. I think we end the scaling series where we started really, which is defining what really sets you apart, what makes you different, what you're going to uniquely bring to this space and to your customers.

The biggest brands out there that have been successful all have that as part of it. So, if you want to grow defining that from the beginning's incredibly important.

Austin Brawner: Yeah. Would love to hear your feedback on the scaling series. Hit us up on Twitter or shoot us an email on Twitter, you can find and find @A_brawn or at @AndrewFoxwell. We love to hear from you guys on Twitter, it's a lot of fun.

Hopefully this was a helpful series, and again, there's five episodes. If you haven't listened to them, you can go back, check them out at Ecommerceinfluence.com. We will talk to you guys very soon.

Andrew Foxwell: Thank you.

Austin Brawner: Hey guys, it's Austin and if you've been loving the podcast you've got to go check out brandgrowthexperts.com. That's where I work one on one with my clients to help them build faster growing, more profitable online stores. I've got coaching programs and workshops that we host all over the world. Would love to have you come check it out.

If you are a fast growing eCommerce business or you want to be a fast growing eCommerce business, you got to check it out. That's the spot for you. We go more in depth than we do in the podcast with comprehensive trainings and coaching to help you scale up.

Check it out. Brandgrowthexperts.com. See you there.

Austin Brawner: What's up, everybody? Welcome back to another episode of the e-commerce influence podcast. My name is Austin Brawner.

Andrew Foxwell: And I'm Andrew Foxwell and we are here with a final part in the scaling series, part five.

Austin Brawner: Part five. We are fired...

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