Today on the Winning with Shopify podcast.
In the nicest way possible, Nick, you stick to SEO and I'll
stick to MPD. All right, let's do that then,
shall we? Let's do that.
I think that's the word. It's fatigue.
Half of the people that bought find themselves.
I think e-commerce is instantaneous.
They're just, they're just boxes of cash sitting in your
warehouse. But you'll get it a really good.
Price pull everything down. And within three months, we
started to get customer complaints.
Hello and welcome to another episode of the Winning with
Shopify podcast. If you've not seen it before, my
name's Nick and I've been hosting the show since 2020.
June 2020 is when it started. And if you haven't listened to
the show yet, you've been missing out.
And nothing to do with me. I'm not the star of the show
here. I just host it and I get to talk
to some amazing, amazing people. We get brands on, we get
suppliers on, we get tech tools on, we get Shopify apps on.
We have people that have done research papers and all sorts of
other things to help you grow your store and make the store as
successful as possible whilst having a lot of fun.
And I was going to say a minimal stress.
Stress is actually a really good I'm reading a book about stress
at the moment and how healthy it is for you.
That's how you manage it. Anyway, enough tangents about
stress. I'm not medically trained or
anything at all. And if you're thinking you're
tuned into the wrong podcast, you'd be right.
We're going to be talking about Shopify and e-commerce and
joining me today is an absolute legend.
And he's been on the show before.
So Johnny from Toasted. Johnny, welcome back.
How are you? Good morning.
Good afternoon rather, Nick. Yes, I'm, I'm good.
Thank you very much for having me back.
It's a pleasure. Well, it's lovely to have you
here and I love your product because I can't not look at the
site and then think I am really hungry now and I want to start a
fire. So tell us more what what is
your product? What do you guys sell?
And also really importantly, I remember this from last time.
Who do you run it with as well? Because I love the story behind
how it started. OK, so Toasted is a family
business and I set it up in 2020 and I brought my daughter on
board a very early age. She's currently at university so
she kind of like comes back and helps, but hopes to move back
when she finishes at the end of September next year to help me
drive the business even more. We're basically a family
business that produces marshmallow and toast and dip
kits and smalls kits for families to enjoy.
And the kits include all you would need to enjoy toasting
marshmallows and making smalls indoors, outdoors, or whatever
the adventure takes you. Or in the doorway.
The marshmallow toaster. They've got marshmallows,
skewers, chocolate sprinkles and the beauty about our products is
that they're all packed in plastic free packaging.
Because I think for us as a business that started a few
years ago, why not set your stall out to be plastic free
from day one and try and be as eco friendly as possible?
Because it's much easier to do it on day one than it is to try
and change midway through that business journey.
Amazing, amazing. And you've got some stories to
tell and we're going to dig in some of these as we go through.
And I again, I love the product. It makes me so hungry.
But we're going to talk not immediately.
We're going to talk a little bit later actually about brand
positioning and how you bring some of those occasions and
events and scenarios to life in your marketing and your product
fit. And even just before we hit
record, I saw one of your ads on on YouTube coming up.
Probably we thought we think probably from one of your P Max
campaigns that was popping up was quite exciting and but
obviously around the corner right now.
And you've got some really experience in this as as have as
have I and lots of people in the agency behind me.
And but Black Friday, Cyber Monday is just around the corner
and you've put something really interesting in the notes ahead
of today around e-mail versus ads or both.
Tell us how you guys are prepped for Berenice is going to be what
your fifth Black Friday actually for?
You might have done it in the first year or two, but your
fifth one for Toasted as well. Like, yeah, talk us through the
e-mail versus ads conundrum. OK, So it is a conundrum because
as we've gone through the, if you like the five years to get
to where we are, we've had lots of learnings.
Like anything in life, we say we're experts, but you can
always learn and develop and improve.
And I think it is a mixture of the two.
You can't just rely solely on e-mail because that only goes to
your existing customer base or M Robe, sorry, not robe and listed
subscribers. And you can, you can't just go
to prospects via advertising. So I think it has to be a bit of
both. And the reason I say it's both
is because we've learned very, I suppose painfully last year and
the year before that you can't do 1 without the other.
And we've got a very strong and loyal customer base, but we've
also actively got a very growing prospect subscriber list.
And the whole strategy for this Black Friday is to encourage
them to move through the steps and to engage for their first
purchase or indeed for us as a business that enjoys significant
repeat business, to try and entice them back for a second, a
third or a fourth purchase occasion.
And, and to do that, it's about educating, it's about informing,
it's about entertaining and showing them the potential usage
occasions and maximizing the gifting opportunities.
So people will buy for Black Friday predominately for one
reason, which is for Christmas and for gifting.
They don't really buy for personal consumption unless
you've got a small percentage who kind of will hold and they
will stockpile for use after Christmas and in Q1 because they
see it cheaper and a better way to do it.
We have no problem with that, Nick.
We like those. Great higher, deeper basket
spends. However, in conjunction to that,
ads are really important because they do two things.
They show up in people's feeds to new prospects, people who
aren't aware of us, or even people who have come across the
brand before. And it's about just pushing and
nudging and enticing and bringing them to make that
purchase during that Black Friday weekend.
And for us, we're currently in the throes of pulling together a
final, if you like, e-mail and advertising campaign for Black
Friday. And one of the key learnings
from last year, Nick, which you may well have evidence in giving
you a background in your agency, is that Black Friday isn't just
around those four days of Friday to Cyber Monday.
A lot of brands have extended it out and they're offering the
full, if you like, promotional campaign for seven days starting
on the Monday before the Black Friday.
We've had longer than 7. It's a lot longer than seven.
I think our record was seven weeks rather than seven days.
Yeah, yeah. It caused the headache.
The business nearly fell apart in January because of.
Sale fatigue initiative or was that a client to you?
Don't do this was our was our official e-mail.
Yeah, yeah. And it was, yeah.
We reached January and everyone was like, well, it's been
discounted for so long now, why am I paying full price?
And we actually had to wait two or three months and just pull
everything down. And the only option was to just
pull all marketing down until kind of March, April, and then
sort of slowly start trickling it back up.
And over that time, they decided to launch like almost a
completely new product range just to say like all the old
stuff's gone. This is new, it's premium, it's
luxury. They had to work so hard.
They we did get it back up and running and we still work with
those guys. But it was, yeah, sell fatigue
was was quite extreme, quite extreme.
Yeah. And I think that's the word.
It's fatigue because every brand is trying to capitalize on Black
Friday. And so you can go earlier and
try and get ahead of the pack. But does that do you any benefit
in relation to your community and your audience?
Probably for the first week, I'd imagine.
Yeah, I see that as well. Maximum.
To be honest, Nick, I don't even think this year we will go a
full week. I think we will just capitalize
on maybe the Friday to the Monday and we might do teasers
and incentives for the prior period and the post period.
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Absolutely, which makes a lot of sense.
And I love what you say as well about the some people will buy
for themselves. We did an e-mail survey last
year to one of our clients because we thought people were
stockpiling for themselves because they're all not
necessarily stockpiling, just buying gifts for themselves,
which sounds really bizarre because a lot of the things they
bought were the same trends of things they'd bought earlier in
the year. And it, it wasn't like, oh,
look, here's some, it's not the kind of thing you go looking
for. You don't look at like there's
this one period of the year. And is that different to it?
Like all the people that buy 5 + * a year does, does their buying
behavior at Christmas match what they've done the rest of the
year? 50% of them were buying gifts
and 50% were just buying another product themselves while it was
on discount. And it was literally a 5050 of
the revenue. Half of the people that bought,
buying for themselves, which I thought was fascinating.
And I love what you're saying about, yeah, the ads versus
e-mail, though, there is a big opportunity.
And also I would say every year, like customers are in buying
mode. It's like be be available
because people's wallets are full and open and ready to roll.
So if you're not around in that time, say you like go like
second week of Jan, Let's, let's, let's do a massive push
in advertising with no discounts.
It's like people are in discount mode.
It depends. Obviously in the niche, the
space, the country, everything, but people are in discount mode.
So I think it's, I love what you say about riding the wave when
it's there, but then also knowing what we're going to do
next afterwards. Actually easement's my next
question. So what are you guys planning
for given that you've done five years of this now, what are you
planning for January? Is that going to, how's that
going to be different obviously to peak, we know we're going to
peak. What's going to be different in
January? OK.
So in January this year, we're going to do things slightly
differently. So I'm always kind of late to
the party because I like to bring new products out.
This year, as an example, we've brought Christmas to Halloween
much earlier than we normally do.
We launched late August. I've never done that before in
five years. I am feeling the benefit of that
because we've had significant sales of those two product
lines, much more than we've had previously.
So that's a real advantage. So carrying that trend forward,
we've got new products ready to launch for Q1, stroke Q2.
So we will launch those in mid January.
And so they're kind of along the lines of fire pit kits which we
currently do, but we're going to be doing them on a much bigger
grander scale. Think Toblerone in terms of
triangular tube, but extend it to warm up the meter in size.
And that's kind of going to be where we're going to be focusing
Q1 and certainly mid January. But what I would say, there's a
brand that is kind of consumed all year round and has an
element of gifting. So we get a massive spike at
Christmas. We don't fall off a Cliff and
don't sell anything in January and February we still get a lot
of consumption because people would be doing for the weekends,
they'll be starting to prepare for camping as well as back to
school and gifting and people going back to university.
So January, believe it or not, tends to be really busy for us.
So it's a mixture of making sure we've got enough stock post
Christmas to cope with the demand that we'll get.
We don't really have to incentivize that much.
So we're not doing really deep kind of like, you know, post
Christmas sales. We might have a little kind of
like a gentle offer, so to speak, but we're not kind of 50%
off or 40% off because we never really go to those depths
because we're not that type of brand or business.
But what we will do is kind of like educate and incentivize and
try and encourage people to maybe build, buy.
Maybe the average weight of purchase will increase because
they're buying 3 or 4 kits at a discount rather than that single
or or additional purchase. Amazing.
I mean, there's so much to go out in that.
And I'm going to start with this one where you launch the range
end of August. We've been launching stuff early
for clients purely from an SEO point of view to get the ranking
before the season hits. And so some of our clients, we
actually have pages live all year round for Black Friday, for
Mother's Day, Father's Day, Valentine's Day, Labor Day, for
American businesses, Thanksgiving, we have these
pages live all year. So we're already like in the top
ranking and already competing while there's zero demand.
And as the demand starts to trickle in, we're already number
one and then the product range launches.
So we put like an e-mail, you know, sign up to be the first to
hear about this, but we're going to e-mail you right up until it
starts about all the other things that are similar.
So if you're celebrating Mother's Day, well, Father's Day
is coming. So you know, we've got Father's
Day to talk about and then we've got Christmas, which is also
gifting. And then we've got Valentine's
Day, which is always also gifting.
So if you're a big gift buyer, we've got the whole year to talk
about you until the next Mother's Day when you're going
to buy the thing that you've actually signed up on the
waiting list for. So there's all these e-mail
stories, but the SCO especially is you do not want to try and
get to #1 on Google on Black Friday starting at one minute
past midnight. You will not be there by the end
of the day. And now it's Saturday and Black
Friday. That's really interesting.
Because you're kind of capitalizing on 1st mover
advantage from an SEO optimization, which there are
many people in the industry that talk about that.
So that's quite refreshing. It is part of our secret sauce
and my SEO agency turned me off for telling too much on here.
They're like, people should pay for these things, and obviously
someone's still got to go and build the thing and make it
work. There's still the whole of SEO
to be #1 but yeah, I think it's, it's fascinating to see how
early businesses and brands start to go on this.
And we've got notes here as well, Johnny, about expanding
your range with your niche and identifying new growth
opportunities. And you've mentioned the biggest
buzzwords in the last five years, which is vegan, gluten
free and dairy free, which are all fantastic things to the
right person, which is cool. How complicated is that to
branch out into those for products like yours where
marshmallows, I don't even know. Are they traditionally all those
things or are they specifically made of milk?
I actually have no idea. I've eaten them loads over the
years. I've never looked in the back of
a packet well. You'll be surprised.
Most marshmallows in the UK include gelatin of a beef or
pork basis and therefore they are obviously non vegan, non
vegetarian. And some religions as well,
which is in other important markets, correct?
It is an important market, particularly as I think we've
noticed certainly in the last five years there's been a
significant level of interest and growth in smalls each year
on year on year. I guess, you know, back on the
Americanization and the normal consumer trends, but we've also
done a lot of work. We've advertised quite heavily
in the last five years. You yourself mentioned before an
advert popped up on YouTube. So we've kind of really from a
category perspective been the only people driving the growth
of smalls and marshmallow kits. To switch to vegan and gluten 3
and dairy 3 hasn't been easy because as a brand of our nature
and my background being in food of 25 years, I'm very much
quality first. And if I can't get a quality
component that ticks the box for vegan or gluten free or dairy
free, then we won't consider it. And so in the early days, we
launched the three from kit as a kind of tickle boxes and the
quality of the chocolate that we managed to get at the time that
was dairy free, vegan and so forth was excellent.
Fast forward two years. That said, supplier in a very
difficult marketplace decided to close their business.
So we ended up again going around the market and trying to
search for a quality replacement.
It was a challenge. We didn't really have a range
for about a year. But now I'm happy to say that
we've got kind of like the best selling, the fastest growing
vegan smalls kit in different sizes.
We're even about to launch a vegan hot chocolate kit and
we're doing really well on that area and it covers 4 bases, as
you said, not just gluten free and vegan and vegetarian and
dairy free, but also the religious that we get a lot of
halal type consumers who are really interested to give the
kids that experience. They may have gone to a birthday
party where people have bought 30 of our mini smalls kits and
they might have been a recipient of a vegan mini smalls kit which
they thought was absolutely wonderful because their kids are
not missing out and they can enjoy the experience and the
occasion. And one of the other areas that
we've really benefited from is corporate gifting because if
you're a business and you're looking to source corporate
gifts, you want a product that has a bit of flexibility.
So if I've got, you know, 100 employees and I'm going to send
a smalls or a gifting kit to, what about my vegan and Dairy 3
and Gluten 3 members? And in a workplace, don't take
any chances is my. Experience.
It's like just cater to everyone and ask no questions apart from
what do I need to cater for? Yeah, and we even get some
corporate customers saying, look, it'll be easier, let's
just do 100 of vegan kits so everyone gets the same kit.
Yeah, yeah, I I had someone recently and I won't name names,
so I can say what I can give you, give you the full quote for
everyone listening. But I the other day he said he
went on a rant like I couldn't eat vegan, I don't want vegan.
So quite an ignorant kind of view.
I think like I eat a lot of vegan food.
So and then he and then he goes there in the middle of this rant
he goes, Oh no, I could never eat vegan chocolate.
I just couldn't do it. Like just it wouldn't work.
I said, do you like dark chocolate?
And he goes well, yeah, but only the non vegan ones.
I'm like, I don't think any dark chocolate.
It's like milk free. It's just Coco.
Shows how and they kind of, you know.
Yeah, there was sort of the well, yeah, I don't mind that
one, but is that just so it was brilliant and but but point
being is you're absolutely. Right.
Yeah, we come. Across that actually the safest
option. Sometimes lots of people have
examples. Oh, sorry, it disconnected now
it's reconnected, OK. That's fine, no?
Problem. I'll jump.
I'll jump straight into that bit.
I was about to round off that comment, but so, yeah, the the
safest option sometimes you say with the corporate gifting is
let's just go vegan all the way through and people, people's
reaction to a good product as well.
It's almost like a oh, like vegan people would go like, this
is delicious. I'm going to buy more of these.
It's fantastic. As a vegan, I found a new
product or as someone who's got, you know, some sort of dietary
requirement, I found a new product I can have This is
fantastic. So everyone else going that's
vegan, that's all right. That's actually really nice.
Like I quite love that. And I've actually like, I'm not,
I'm not completely dairy free. I can have a low level of dairy
too much and it just makes me feel unwell.
So I, I found some really good dairy free cheeses now and that
I eat sometimes just on their own.
I literally go, I'm gonna have some cheese and wine.
I'm gonna choose the, the vegan option because it's so much less
like all the bloating and all the other stuff.
And you can sleep properly afterwards because your body is
not trying to digest. There's all these like good
outputs. So I think having those options,
I mean, you've mentioned, I'm not going to go down to all
these routes. You've mentioned supply chain
issues. We talk a lot about that on the
show. You've mentioned corporate
gifting, fantastic idea, which links I think into, again,
bigger orders, links into something right at the end of my
notes about wholesale. We're going to talk about in a
bit as well and going into that. But I'm going to bring up the
question now because I mentioned at the start and you've
mentioned so many different situations and scenarios where
someone would enjoy your product.
How do you bring that to life in your branding?
Because your brand, like yours, starts to get to the point where
you've got so many messages and avenues and wordings and
benefits and USPS that you could go down.
How do you structure and organise that in your
communications, your marketing messages, your emails, your
adverts? How do you decide which one to
roll with where? Great question.
So for us, we tend to simplify it.
We will try to use the enjoyment factor, which is the outcome
from the product as the hero. And then we will wrap around the
potential usage occasion or the gifting opportunity around that
hero proposition. So it simplifies it.
So a lot of our ads that you may see on YouTube or Matter or
Google, it's all about the product and the enjoyment.
And then we'll wrap the copy and the text and the positioning, if
you like, around the different scenarios that we're trying to
focus in. Yeah, yeah, the one, the one
that's come up, I've just gone straight back to the page.
I actually shut it and reopened it.
It's got a, it's got one of your little toasted heat kits with a
little flame coming out of it. Sorry, not heat the little
literally out of the. Fire and then it's got.
Some packets behind it, some fairy lights in the background
so clearly and a tree clearly outside.
So like, yeah, I see what you mean.
Like it's very kind of this, this is this could be you, which
is the first rule of marketing and sales is always features
tell benefits sell. And I find so often brands we
work with, they look in their warehouse and go like, oh, look,
there's one of the. For these, let's call it that
and it's like customers don't call it that.
They so often customers call it the size, the colour or or where
they're going to use it. They don't necessarily call it
the thing. So they might not search and to
find you marshmallows, but they might search like small kits as
I would imagine. Have you not done any keyword
research? Am I close?
Is that is that far off or? No, they put you on the mark,
and I'll guess the rest of your colleagues in your agency will
be patting themselves on the back for a job well done.
There we go. You've nailed it.
They're the keywords. Yeah, Yeah, absolutely,
absolutely. And let's talk about wholesale
then. So obviously you can sell one
product or you could discount it and sell 1000 of them somewhere.
Are you guys, is that, is that in the future?
Are you doing that already? Like where, where are you guys
at with the wholesale side of the business?
Very good question, Nick. So we started our wholesale
journey earlier this year. Now, anyone that knows or anyone
listening to the podcast knows that if you sell wholesale, you
sell it at a lot lower price than you would if you were
selling it ecommerce and DTC because you've got to give the
retailer the opportunity to make a margin common sense.
However, the benefit being you're selling a bulk, bigger
quantities and you tend to be paid in a similar way if you're
using a platform like say, Fair. So this year we've branched out
and we've really gone through it.
So we had major listings in two of EU KS largest garden centres,
which was really beneficial. We've also started to focus in
on the online wholesale platforms like Fair.
However, in saying that, it also frustrates me because when you
have a platform like Fair who are only interested in selling
and obviously taking the Commission, they're not really
interested in the end user. And are they a potential
stockist or is it someone who's just registered on Fair?
Like in my example last week where I got an order faulty
kits. This is brilliant.
This is great. Do a quick check on who the
customer was and it's a care home.
So clearly an owner of a care home has decided to make a
purchase maybe to gift staff. They will never repeat that
purchase, but they managed to get wholesale discount.
So the anomalies aside, I think wholesale as a part of your
business strategy can really complement your growth and
that's the way we look at it. So higher margins through DTC,
lower margins through wholesale, but wholesale get you more
eyeballs and more fingers on the product when it's in situ, in
convenience and gift shops and garden centres and those
additional retail environments, which only then lead to people
coming back to your brand online.
So it adds to that virtuous cycle.
Yeah. Do you ever find that in your
warehouse? You have dead stock, You can't
sell it, no one wants to buy it, and you can't get a refund on
it. Or alternatively, you're missing
inventory in your warehouse that you need, you've got sales
coming in and you're low on stock and you haven't ordered
more stock in time. All these things hit profit.
And I've been there. I've run my own Shopify store
and had exactly that problem. But we've partnered up with
Inventory Planner who have the most incredible app to help you
manage that and forecast exactly what products, what skews even
down to what colour of product you need to order in advance to
make sure stock levels remain consistent throughout.
They're also running a seven day boot camp.
And if you want to go and sign up to that, it's 7 emails every
seven days and it takes the same amount of time as your morning
coffee. And in seven days, like me, you
can become an inventory management pro.
Both links are in the description.
Enjoy. Absolutely.
You made some good points. And a lot of businesses we've
spoken to over the years or business I've worked with, they
go through these phases with wholesale 1 is when they start
on like fair or they get a contract through like maybe it's
something in marketplaces. So like your Amazons, your way,
fairs, etcetera. And obviously relevant to each
company or each brand. You start there, then you move
into a phase of like, OK, let's actually make some of these
stockists now like proper relationships.
And then you move into a phase of going, let's hire a sales
director and just give them a company car and be like, dude,
500 laps of the United Kingdom or the United States and do not
come back until you've got a billion contracts signed from
every possible place that could stock us.
And now we've made it. And obviously every time you got
the food chain it or got garbage, those steps, the
initial outlay cost goes up, but the rewards go up as well.
And you get those, those relationships.
And there was a similar, similar food and drink brand I spoke to
you about a year ago who they managed to get one contract with
British Airways to sell their food within the British Airways
like meal they were doing on the planes.
And as soon as they got that, they just phoned all the other
airlines and said, we've just signed this.
Well, we've got this contract in principle.
We haven't put our signature on it.
Would you like to cut us a better deal?
And just started like negotiating them and they
managed to increase their increase their margin by 22%,
not signing the British Airways 1.
They ended up I think. It was either Qatar.
Or Emirates. And I thought it was so smart
and said, well, what market you going to next?
They were like, that's a great idea.
So like they immediately were like, right, that's planes.
Where else can we sell them food?
Is it private hospitals somewhere where you're given a
meal basically and you want something a little bit special
in that meal that doesn't cost much?
So it's like, I think the wholesale journey is really
good. But you make such a good point
about fare. I at work have a Costco card I
use on buy and I use fare to get get those wholesale discounts.
Obviously two of those are designed for people to bulk buy,
but fare will give you the full trades kind of wholesale price.
We're lucky enough we've got enough clients and enough spaces
that like our coffee, we buy a wholesale from a client and all
our furniture we get a wholesale from a client like yeah, we've
got, we've got some good stuff like that.
But I think having that direct relationship like you mentioned
with the garden centres that that that's always going to be
better than, yeah, you just let them up and it's one care home
sort of thing. It's going to be better,
however, to go into the wholesale environment you need
to almost upskill because if you're an e-commerce specialist
and haven't had the benefit or expertise of growing a brand
offline, it's a total different kettle of fish.
I'm lucky. I've worked on big brands in big
food businesses in a traditional way and I've then migrated onto
e-commerce and become more of a specialist on digital.
However, for a brand that hasn't really done sold online, to jump
into wholesale, it is a challenge because you do need to
go and invest in going to see some of those retail outlets to
drive footfall and sales. You can.
I always work on a motto, Nick, that you can sell anything once,
but if that's not a brand or a business, because if you don't
have repeat sales, then you haven't got a future.
You've got to keep chasing that next listing, that next
customer. And what you want is repeat
business that keeps dripping, pouring in to grow the the band,
the brand and the business. Yeah, yeah, it sounds like
you're looking at my agency model.
We only work on retainers here. Like it's, I know exactly if
every single client left today, I know what my notice periods
are and I know when we're going to run out of cash.
It's like, and those are the metrics I look at in e-commerce
is so much harder. And we actually, we do actually
see that in, you know, dare I say on my own podcast with
hundreds of thousands of people that listen to this every week
now, like dare I say that actually e-commerce is one of
our shorter contract lengths, which is probably not a surprise
to anyone. B2B companies where it's like
we've got an 8 year lead time between someone filling out a
form and purchasing our products.
Well, we got eight years before we even start to know if when we
started we were effective or not.
Say you get that longevity with things and it's, it's a much
stronger position. But to be honest, we love
e-commerce. I love the fast and furious
nature of it, hence why we do all of this.
It's like you make a change today and it's like ROI has gone
from 4:00 to 5:00 and then the FD like what does that mean?
It means every pound we put into Google getting another pound
back out like, and it's just pure profits.
We were above the break even lines like great, can we spend
more? It's like, yeah, yeah, we can
spend more. Like it's really exciting, but
or you can also have the opposite conversation, which is
really the thing was going not working, turn it downloads.
Let's talk a little bit about Black Friday, Halloween, let's
talk about Christmas, but specifically about trends.
You mentioned, we mentioned earlier about some of these
things, but like the seasonal trends.
I've got the massive, massive question for you and you
obviously your background in food and drink, you probably
know more about this and the pain of this than most brands
because of the shelf life and the use by date and stuff.
How do you make sure that when you bring all your stock in, you
get enough that's themed around the season, say Halloween themed
things. You get enough Halloween themed
items in that you don't run out of stock and you make the most
of that season that that sales periods without ending up with
all this dead stock That especially in your in your world
and your background as well, that will go off.
How do you manage that? What are some of the some of the
tricks you've learned over the years?
OK. So we're very fortunate that we
pack all of our own components and kits and make the kits of
ourselves. So the only elements that are
themed will only be an element of packaging and a 1-2 or three
components that sit within the kit.
And the reason for that is simplicity is always the best.
So we only have, believe it or not, we've probably got about 25
skews, but we only have two standard boxes, one large, one
mini, and it's a generic design. And then we adapt it by having a
printed sleeve that wraps around a portion of the box and the
printed sleeve can be printed in much lower quantities.
So if we over order by 100 or 200 or 500 or even 1000, we're
not talking, you know, a shed load of investment.
It might be 200 lbs. However, having done this now
for a while, it's much easier to forecast and judge what that
initial order should be. And then we top up as we go
through the seasonal trend. So to give you an example,
Halloween, we haven't gone out on ordered, you know, 5000 kind
of like printed sleeves to complete all of those kits.
We're packing them on a daily, weekly cycle.
So we know that there's only probably 3 days left of
Halloween sales and we have only really packed what we think we
will need. If we've got components that are
Halloween related like pumpkin marshmallows, we've only bought
a certain amount of those and the ones we have bought have an
extended shelf life to January 2027.
So that would allow us then to use them at the beginning of
next Halloween season. And that's how we as a business
capitalize on these seasonal trends without the the risk,
shall we say that you've flagged.
Yeah, which is a smart way to do it.
We we've had one or two brands that start doing like a mystery
box. That's a good way of getting rid
of dead stock. So it's like at Christmas you
get like, you know, one that's got a sun on it, one that's got,
I don't know, like 1's got a heart on it from Valentine's
Day, one that's got a pumpkin on it.
If you're like, which you know, as you just said, like it's
basically the same thing, but there's a slight different theme
around it, but it's the same product all year round.
I think the longer you can make the shelf life, the better.
We've even had brands before say like you can do a short life
mystery box, whether it's like makeup, cosmetics, food and
drink, supplements, whatever it might be.
But saying like these, you know, you guarantee at least a three
month shelf life. So you use it all in that time,
but we're going to give you a discount if you do a mystery
box. And a mystery box means we can
kind of control what goes in it. Not so easy when you've only got
1 product in two sizes like you do with various variants.
But I think it's all about getting creative in marketing.
I think the data tells you what's wrong, but then you've
got to do some creative testing to fix it and go.
We tried that. It had every reason why it
should work, but customers hated it and they just hated it.
And, but luckily our branding means we can just sort of say
sorry to them and move on. Like, sorry you guys didn't
enjoy that. Here's a new one that you will
enjoy because of the feedback we got on the 1 you didn't enjoy.
And so you've engaged customers and that that, that
authenticity, which is word of the year, I can't remember last
year, the year before in the US And that trust you build with
people, I think is really, really key, isn't it?
I think it is, but you've just hit the nail on the head because
I think e-commerce is instantaneous.
So I've seen a lot of brands be on TikTok and use their TikTok
shop to clear end of life and bundles of stock out at a really
low price. And I've also seen, as you've
probably witnessed, the massive upsurge in mystery boxes
because, you know, we did a kit last year for Eurovision and
we've still got some of the packaging left and we keep
generating. We're going to do mystery boxes
and you're going to get Halloween, Christmas and
Eurovision, but you'll get it a really good price.
All the products will still be in Live, but you can have a bit
of fun because you don't know what you're going to get.
And those products that are unsold, I always use the analogy
like this. They're just, they're just boxes
of cash sitting in your warehouse that you can't spend.
You can't spend that cash until you've liquefied them into
actual money. And we've got some numbers from
the business as well. Say you guys around 450 KA year
and but you've increased 40% year to date.
What on earth did you do? I think this is the biggest
question everyone's been waiting for in this whole episode.
What on earth did you do to make that, or what things have you
done, if I'm sure it's more than one, to make that happen?
Well, do you know, it's a really interesting question and without
being modest, I don't really know whether that is similar to
other brands, other businesses and e-commerce or whether it
books the trend. We've been very fortunate
because we've aggressively pushed Google this year more so
than last year. So that's really helped with the
numbers. We've also really benefited from
focusing on Saguno, our e-mail, if you like platform, which I
know you know very well. And indeed.
Yeah, We're getting some really good levels of engagement and
conversion. And as I said at the outset, we
have a really strong repeat purchase.
So we're very lucky that our customers don't just buy us
once. They like the product, they like
the experience and then multiple times across the year buy for
different occasions. So they will buy for birthdays,
for Christmas, but also for a thank you for having us for over
the summer holidays. I think there's three key
reasons why we're growing at such a fast rate.
The 1st is capitalizing on usage occasions.
So we've been really focused on summer holidays.
So we really do well in the summer where people take us to
their staycations, they take us camping and caravaning.
We're also getting probably at the height of summer, 5/10/15
inquiries a year. Are your kids safe to take on a
plane? And we're now starting to have
people take them on holiday. You know, even at Christmas.
There's a lovely family two years on the run they've now
taken it to, I can't remember the name, it might be Myrtle
Beach or, or Florida. And it's this gorgeous beach and
all you'll see is 2 gorgeous kids with a toasted kit and the
sunset in. Love that which is like British
camping in like January and it's like let's.
Have some smalls quickly. And cheer ourselves up.
But yeah, yeah, Florida beach love it.
Yeah. And so we've.
Really been lucky in that front. Secondly, our mini kits are
doing phenomenally well. So our mini kits are miniature
versions of what we've done so well for the last four years.
There were lower price points, so they have a greater
opportunity for gifting. We're able to sell them to
people who are using them, believe it or not, for party
bags and so they will buy them in multiples of 10/15/20, even
30s. So when you've got an 8 year old
having a birthday party, they're buying thirty of these to put in
a bag as a thank you for coming to the birthday.
They get heavy discounts, so they're much more competitively
priced, but that's really helped to drive our sales and growth.
So, Johnny, you've said a few things now and I'm going to
emphasize this quite a lot. A lot of people look at other
brands and say, oh, sorry, A lot of brands look at customers and
say, do you know what? There's a customer and they've
got this question. They want this part of it,
whereas you've mentioned that the customer takes you with them
on a plane on holiday to Florida, which I think I think
it's an example of how you view the customer and therefore why
customers are so engaged with you, why lifetime value and
things are so high. And I say to people who are in
the agency, if we're working with a brand or a client at all,
imagine there's a boat we're holding 2 of 30 or 40 oars,
keeping that boat moving. So as soon as you see we're
helping you with your business and it's your thing, we're not
taking any ownership of what we're doing anymore.
So we're just naturally not going to care as much and we're
not going to do as good a job. And so I love the fact that you
talk about your customers like that, but just one marketing
idea. And this is where more marketing
stuff starts. If, if people are asking, can I
take it on a plane, Surely your 15 SKUs needs to become 16 SKUs
or, or whatever number you said earlier and, and do a plane safe
kit and just put the same stuff in.
Surely that's surely that's what's needed here.
Johnny is like a This one's safe for cars, this one's safe for
campings, this one's safe for nuclear power stations, this
one's safe for planes. In the nicest way possible,
Nick, you stick to SEO and I'll stick to MPD.
All right, let's do that then, shall we?
Let's do that. Good idea, and I think we're
getting there, but not quite that way.
Yeah, absolutely. I mean, the way we do do it is
if somebody wants like a blue, like a blue one, we make sure
there's a way of shopping just all the blue products on this
store. But yeah, it makes a lot of
sense, makes a lot of sense. Anyway, let's let's draw down to
the last thing then. So we've mentioned wholesale,
how are you guys at the moment? You're based in the UK, we've
got the government and the previous governments have all
been a bunch of morons and apologies that offends anyone
listening. But I think it's a unanimous
thing in the UK that we just don't like politics anymore and
haven't done since probably 2008.
Maybe, maybe some of us who remember the 70s, which I don't,
also disliked politicians in the 70s.
Anyway, where are you got, it's a very difficult climate.
Where are you guys going? Where's your focus, what you
want to achieve? Where are the opportunities for
a business like yours at the moment?
OK. So the opportunities for us
interesting enough are one follow the same plan.
So and our plan seems to be there's still a lot of the UK
market to go at. There's over 10 and a half
million families if not more and we're only really scratching the
surface. Wholesale is a massive
opportunity for us as well as gaining direct distribution in,
if you like, key usage arenas and by that I mean caravan
parks, centre parks, areas where our family model go and use the
kits and have fun and go on staycations too.
And fourthly, we're also actively speaking to small
independent, if you like staycation facilitators.
So I go on holiday quite a lot to Anglesey and there used to be
a small family business that you could book your holiday through
and they had about 200 holiday homes.
Most of those holiday homes will be entertaining families
throughout the year, whether it's for a weekend or a week in
the summer. And we're trying to actively get
our kits placed in those holiday locations or have an opportunity
to purchase while they're there during the holiday and it can be
delivered and served and used and enjoyed outside of that.
We're also actively looking at expanding outside of the UK.
That said, so we dabbled in Ireland earlier this year and we
look to accelerate that next year with a view to also going
to maybe Scandinavia and possibly Holland.
Amazing, amazing. So you're, you're basically
growing deeper in the, in the market you're currently in and
spreading out to more markets, which I think is a really smart
way to go. And obviously in this day and
age, like, you know, Brexit aside, you've got Shopify and
things where you click a button and suddenly you've got euro
functionality and that's it. And you can now sell in euros.
And you can tell you at the moment, like distributing those
places, it's not far the shelf life for products good enough.
There's options to have, have boots on the ground at some
point as well and products in warehouses there.
So I mean, it sounds, it sounds absolutely brilliant.
If this is my final, final question, and I've only asked
this a couple of times this year and I keep forgetting because
Byron's given me a hit list of great questions and this is one
of them. If you could go back to 2020 and
talk to yourself and your daughter and give yourself a
piece of advice back then in another way of asking the same
question is what's the biggest lesson would you say you've
learnt that you weren't aware of then but it's been a really
difficult or really empowering lesson that you've learnt since
starting Toasted? Oh, Nick, or should I say Byron?
That's a really good question. OK, I'll probably answer it two
ways. One of the earliest learnings in
the business and granted, I will just elaborate my background as
a marketing director for 25 years.
So you would think that I'm pretty focused and switched on.
So when we launched the business, I launched it with a
printed box. The same box that we used today
and it had top right hand corner, a big white space so we
could label the address label on.
And we were just posting them out direct to people.
No point during the launch of that business.
Do they ever think this would also become a gifting
opportunity? And within three months, we
started to get customer complaints in a nice way saying,
oh, I've bought this and I've tried to peel the address label
off to give it as a birthday gift and it's ruined the box.
Can I have them? And of course, at that moment
it's Eureka. It's like, oh shit, I forgot
that there's an opportunity on the back of this self purchased
product. So that's the biggest mistake I
think we made early on and a lesson in life.
It was about some of the points we made before about
understanding the usage occasions and the opportunities
that that one product or concept derives to and from.
So that's the first. The second is probably, and this
is the harder one, if you were growing a business and it's an
e-commerce business, it is really difficult to grow the
business at the level we are and still bootstrap the business and
naively and it's not naive, that's probably the wrong word.
And I didn't want to take out with investments.
And at this point five years in, I'm still on the fence.
Do I don't tie, but to keep growing at 40% and go to all the
different markets and different usage occasions, that becomes a
point in any entrepreneur stroke e-commerce business where you
ask the question, do I need to take outside investment to grow
faster and better? And that's probably the second
biggest learning that I've not really come to terms of as yet,
but I'm conscious and aware of that decision that needs to be
made. That's amazing.
Thank you so much for your humility on it.
Like, they're both really good points.
And I think you just don't know what you don't know.
And it's not until someone says, I'm trying to do this with your
products, you're like, what are you doing that for?
Well, hang on a minute. It doesn't make sense.
Yeah, we should. We should cater for that.
That's a really important part of this.
But Johnny, I mean, thank you so much for joining us again today.
And we're probably going to get you back in the next year or
two. I want to, I want to hear how
it's going. And we'd love to hear what
happens with the investment. Like that's the next big, next
big challenge you're aware of. So yeah, thank you so much.
OK. Well, look, thank you very much,
Nick. It's been a pleasure and keep
doing the good work you're doing with your agency as well.
Thank you so much. And if ever listening at home,
if you haven't already hit subscribe, definitely tune into
our e-mail list as well as go to wwspodcast.com.
We had to change it when we moved to Shopify because kind of
Shopify in the domain and we were winning with shopify.com,
which does forwards. But yeah, go inside to our
newsletter. And also if you want to go check
out Toasted as well, Johnny, what's the URL if they want to
go check out the the website? It's toast, hyphen, d.co.uk.
Awesome. And if you can't spell toast,
there's bigger issues in trying to order one of Johnny's kids.
So thank you so much. And you've got ChatGPT that can
find it as well. But say yeah, thanks so much,
Johnny. Thanks for tuning in everybody.
And we hope you to join us again on Tuesday for next Tuesday tea
break talks. Hope to see you there.
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