Attracting Customers & Building Brand
Building the right brand is one of the most important things an e-commerce startup can do. That’s because the line between a company’s brand and its products is rapidly disappearing—if it ever existed.
This was one of the themes at our recent eCommerce | Circle roundtable, hosted by Backcountry’s Jonathan Nielsen at his company’s headquarters in Park City, Utah—and later that evening at High West Distillery & Saloon.
Founders and other executives from the dozen or so breakaway-growth companies in attendance also discussed emerging online retailers’ creative customer acquisition hacks.
Afterward, we spoke with Sean Kane, Co-Founder of The Honest Co., about some issues raised at the event.
Here's an edited transcript, below.
FC: How do you distinguish between brand and product?
Sean: In large respects, the two are inextricably linked.
If you have a product that does everything it needs to do—it fulfills some kind of need, it performs well, it has distinguishable benefits—then people will gravitate toward that product and, therefore, the brand itself.
And if you have a brand that’s super cool and hip and liked, but you don’t make products that fit those characteristics, the brand probably won't have the emotional connectivity it needs over time to really gain solid footing.
The biggest brands in the world make products people want to engage with, try, experience. At Honest, we strive for well-designed products that are effective, free from harsh chemicals, well designed, accessible in terms of both price and availability, and sustainable.
How we view the product landscape is also how we view the brand and the value we deliver. We want to empower people to live a healthy and happy life through those key pillars.
How does that brand identify influence your product development process?
A product needs to meet each of the criteria I mentioned before we consider building it. It also has to have a sizable market we can address. We want to chase markets in the billions of dollars because ultimately, we can gain scale there. Finally, we look at the competition.
If a product meets those criteria, and the competition is not responding or responding poorly to customer needs, then we'll dive in.
As an example, look at beauty. We play in a lot of baby, personal care, cleaning, health, and wellness categories. We took a look at beauty, traditionally a category that hasn't used the cleanest ingredients, and said, "Hey, you know what? We can make beauty cleaner. We can make products with better ingredients, and at the same time make those products efficacious.”
Probably the next thing you're going to ask is, "Well, why doesn't everybody else do that?"
Why doesn't everybody else do that?
Cost. We are building products that are not only efficacious, but also safe for your family. To do that we use ingredients that costs us more, especially when we're not at scale. But we believe that in the long run, we're doing what’s right for the company and our customers. We'll gain scale, traction, momentum, and market share.
As we take market share, the players that have been putting ingredients linked to chronic illnesses in their products for many years will be forced to rethink how they make them.
Although our products are slightly more expensive, the benefits far outweigh that expense. Over time, as we continue to refine our scale, infrastructure, and sourcing, I think that we'll be able to reduce costs as well.
This issue of customer acquisition was a hot topic at the eCommerce|Roundtable in Park City.
The biggest takeaway is that the ad landscape is changing every day. Things evolve quickly, and something that worked might, a month later, stop working.
Social media, one thing changing every day, is a crowded space. You currently have to be on the lookout for new trends. You have to understand how the platforms are evolving and what the implications are. It's more complex than ever, despite efforts to simplify it.
How does as company trying to acquire customers stay on top of that?
We focus on an organic baseline of traffic. We go after virality. We look for an audience to engage with our brand via our own social channels. On the paid side, we're constantly meeting with Facebook, Google, and other social platforms to figure out how to continually optimize, how to continually move with the moving goalposts. It’s in partnering with them, and listening to them, that you start to figure stuff out.
You have to keep a close eye not only on the customer acquisition side, but also on the flows and the conversions on your own side—what's happening on the back end—to make sure that everything plays together. If something stops working, you can always identify a cause, but you have to constantly pay attention to conversion, engagement, and customer satisfaction. Everything affects everything these days.
Another thing we keep in mind is that customer advocates are probably the best advocates, and your biggest ones are always those who love the brand. Millennials, specifically, are pre-trend or on-trend. They're tech-savvy digital natives. They do their own research, and part of that research is identifying what their friends and communities are doing.
If they love the product, they'll love the brand and be supporters of it. If somebody asks, "Hey. I'm having a baby. What type of baby shampoo should I use?" they respond, "Well, Honest shampoo is the only thing I use, and here's why." They will become ambassadors for the brand, and know everything they possibly can about it.
We take around 5,000 touchpoints a day with customers, through phone calls, emails, live chats, etc. We synthesize data from those interactions into actionable insights on products, on customer experience, on really every piece of the business. It helps us improve.
One way in which we're really excelling ahead of typical companies is acting quickly—getting that information, moving fast, and iterating. If another brand puts something on a store shelf, it probably won't get that type of feedback for six months. Guess what? We'll get it in, like, six hours