#401 - How To Sell Millions with Premium Product Pricing & Unique Marketing Strategies

#401 - How To Sell Millions with Premium Product Pricing & Unique Marketing Strategies with Phil Hadfield Speaker 1: Welcome to episode 401 of the AM-PM Podcast. My guest this week is coming to us from Bali, Indonesia. It's Phil Hadfield. He grew up in the UK but is now living in Bali. Launched a brand in 2019 that did okay and then in 2020 started another brand that's just taken off and doing millions and millions of dollars per year. We talk about his journey of Talk about how he financed it, about how he made it different, and how he actually priced a product much higher than the competition and is doing well with that. Unknown Speaker: Welcome to the AM-PM Podcast. Welcome to the AM-PM Podcast, where we explore opportunities in e-commerce. We dream big and we discover what's working right now. Plus, this is the podcast where money never sleeps. Working around the clock in the AM and the PM. Are you ready for today's episode? I said, are you ready? Let's do this. Let's do this. Here's your host, Kevin King. Speaker 1: Welcome to the AM-PM Podcast. We're back again. This time coming to you from Austin, Texas. That's me. And from Bali, Indonesia by way of I think the UK. Phil Hadfield's here. How are you doing, Phil? Speaker 2: I'm good. I'm good. It's early in the morning, so I'm ready to go. Thank you for having me on, Kevin. I appreciate it. Speaker 1: Yeah, but it's early in the morning, Bally, so I don't want to hear any complaints from you. Speaker 2: I know. I know. I know. I get that. I always say to everyone, though, when anyone, you know, gives me about being over here, I'm like, I did my time in the UK, like I did my time in the cold and the rain. Speaker 1: Yeah, well it rains in Bali too, I mean it's very green in Bali. Speaker 2: It does, but when it rains you can wear a pair of shorts and you can walk outside and it's not so depressing, but I won't give the UK too much shade. Speaker 1: How long have you been in Bali? Speaker 2: Two years now. Speaker 1: So you're based there full time then? That you're living there? Speaker 2: Yeah, pretty much. It's kind of like, yeah, something where we're working on. For now we are. We definitely know we would prefer not to be in there. I think it's the winters. We love the UK. We love the people. It's just the winters are just so long and the days are so short. Speaker 1: So when you say we, who's the other part? Speaker 2: Me and my wife. Speaker 1: Okay, awesome, awesome. Yeah, I was in Bali, man, I think it was 2008. When I turned 40, I'm an old man, so but when I turned 40, I was like, you know what, instead of having a little midlife crisis and buying a flashy Porsche or Lamborghini or whatever, I'm gonna go and just travel for a year. And so I would go by myself or with friends and family and one of the The very first place I went was in January 2018 was Bali. I mean, I've been traveling before that, so it wasn't like my first time out of the country, but that started a seven year journey of going to different places. And to this day, I still have on that trip in Bali in 2008, I stayed in Ubud. And did all the traditional shows and everything, but I don't know if it's still the same. This is 16 years ago now, but there was little villages of artisans. And so I had a guy who would take me to this little village and the whole village was like, these are woodcrafters, or they make furniture in this village, or this one is painters. And in my house right now, I have a full life size statue made out of mahogany wood, literally a human size, hand carved, that was done in Bali. And I ended up buying furniture. I shipped a container back on that trip. I spent like 20 grand or something on my credit card, shipped an entire container back of artwork, like really beautiful artwork, of carvings, of outdoor furniture. I even went to some guys, my guide knew some dude that was an artist and I went to his garage of his house. And inside his garage he had this like door frame that was like hand-carved of like a Romeo and Juliet scene all in three-dimensional. I bought it for like $600 and then I brought it back and had it stained and so I have a fine appreciation for Bali. Speaker 2: Yeah, I'd like to say that my experience has been as cultural as yours, but it's changed a lot even in the two years since I've been here, and then we were here like five years ago, and it's changed a hell of a lot since then. If you're like into like health, wellness, and entrepreneurship as well, it kind of like combines, particularly in Changu where I am, Uber's a little bit different, but it combines everything. So you can really try to have that balance as much as you possibly can whilst running a business. So I love it. Speaker 1: What's a big big destination for for the journey people the work around the world people. Nomadic nomadic what they call nomads. Yeah, the Digital Nomads, that's a word I'm looking for. Yeah, the Digital Nomads, it's a huge, which back then when I was there, it wasn't. I need to get back over and check it out. So what motivated you to move to Bali? Is it just you, like you said, you get tired of the UK life or did you exit a business and like, okay, now I want a fresh start? Or did you just move your whole operation there and just to be based there or what happened? Speaker 2: So I think I've always felt like deep down my, there's something in my genetics that doesn't, That makes me not want to be in like cold and horrible weather. So I think it's, for a long time, I didn't want to be one of those British people that complains about the weather their whole life and then never does anything about it. Because that's all, you know, we talk about the weather a lot in the UK. When it's hot, we talk about, you know, how it's maybe a bit too hot. When it's cold, we talk about how it's maybe a bit too cold. And so I always had this thing deep down that I wanted to move somewhere else. But then I moved to London in my 20s and got a job and kind of did the corporate thing. And you just get, I guess you just get used to just living in a city and just living that life. But I think I knew deep down that I wasn't like totally happy there. And then when we started the business, I finally had an opportunity to work online and it meant that I didn't actually have to be there. And so when you don't need to be in one of the most expensive cities in the world, And you could be somewhere hotter and nicer. I think I wanted to take that excuse. So yeah, I think the main, there's a couple of motivations, but an additional motivation, sorry, was that I started to have like chronic health issues in my, towards the end of my 20s and in my early 30s. And I didn't think London was one of the best places for me to be to kind of, for my health. So there's a number of different reasons there and motivations. Speaker 1: So you work corporate world and then when did you make the transition into e-commerce? What year was that? Speaker 2: So me and my business partner both left our jobs at the end of 2017, but we didn't take our first Amazon course until the beginning of 2019. I was in Australia because we went traveling. I was in Australia and then got one of those YouTube ads about changing your life. It was some guy in a Ferrari or something and I was like, oh, okay. I'll keep watching that ad. And then, you know, six hours later, I'd taken his initial mini course and I rang my friend and I was like, we have to do this. So beginning of 2019 was when we first took the course. Speaker 1: So in that year and a half, you said you're traveling for a year and a half, so you just you quit your corporate job and we're just like kind of just meandering around doing a doing a walkabout with your buddy or just trying to reset your mind and like figure out what the hell you want to do next kind of thing? Speaker 2: Yeah, well my health as I mentioned had gone and I reached a bit of a I was at a point where I knew it was gonna get worse if I carried on. So I agreed with my job that I was gonna, I tried to quit and then they said, okay, now have a sabbatical, but I knew I was never gonna come back. So I took a year out and me and my partner, we went traveling, but one of my best friends basically since I was like 13, he was having the same kind of like, I've turned 31, I don't know what I'm doing with my life, crisis. It was a tax advisor and he quit his job like three months later. So we both went traveling in different areas of South and Central America and we just met up and that was kind of like when we both were just talking about how the reasons why we left, why we didn't wanna go back and that was when we kind of, we committed that we were gonna start a business together but we didn't know what it was gonna be but we knew we wanted to start a business. Speaker 1: How quickly after that did you actually implement, actually execute and find your first product? Speaker 2: We launched, in that course we went to like an event of theirs and we met a number of people whose advice was try to find any products you can. This doesn't need to be your final brand but just go through the process of launching it and they had this This challenge in reliable education where it was like take, I think it was a hundred day challenge or 90 day challenge where it's trying to find a product and get it launched. So we did that, but it was a shelf divider. It was like the least inspiring, boring, like product you can think of. And obviously it did terribly. Thankfully we didn't sink our savings into that one. But then it, and that was in, that was at the end of, That was at the beginning, in the middle of 2019. And then towards the end of 2019, we were this close to placing an order on a golf travel bag. Even though neither of us are golfers, we'd done this design, we believed it was going to take off. And then at the last minute, because this was literally our life savings, we decided that that wasn't a good idea. And then a few months later, we finally came across the idea that we went into and then that was when we pulled the trigger on that and that was in just before COVID in 2020 that we found that idea. Speaker 1: And that category that you went into is almost the perfect category for COVID. Yes, it's like organizers and stuff like for the desk and home and everything, right? Speaker 2: Yeah, so we These are not like little plastic your website. Speaker 1: These are not like little Plastic, you know throw away things. These are like quality like nice wooden like really well done. Yeah Yeah, it's a piece of art sitting on your desk almost. Speaker 2: Well, thank you. Yeah, we When we went through the whole process of the shelf divisors and stuff, we realized we didn't just want to just sell products on Amazon. We wanted to create like a brand that could exist off and on Amazon. And we wanted to, the reliable course, it was great because it did really talk about investing in brands really from the beginning, really differentiating if you can, trying to create like a very unique design. And we came across this watch organizer niche and it was kind of like ripe for a new design. I looked at it, it was very old, boring designs and this niche hadn't been refreshed in what looked like three decades. It was very much aimed at a guy in a suit with his Rolex. There wasn't really anything for your everyday man. who want something more modern, minimalist. And so we came up with a design that was like completely different. It was then going through that process of trying to find a, cause we had this plan to go out to China to find a factory and then COVID hit. So we had to find, and also there was the tariff wars then as well. So we were like, okay, should we be in China? Everyone was telling us not to be in China. So we were looking in Vietnam and But we eventually found our factory in China and we ended up launching later on that year in 2020. Speaker 1: How did you end up finding the factory, Alibaba or just referrals or how did you end up finding it? Speaker 2: Yeah, it was Alibaba. I did like just a mass outreach on Alibaba and found them. I found a lot of bad factories, but yeah, I managed to found them. Speaker 1: So did you, when you found the product, did you modify it much or did you pretty much take it as is or did you put your own twist on it? Speaker 2: So it's our design. We've actually got like a design patent on it. So yeah, it's completely our design. Speaker 1: So how did you decide, that's a pretty saturated area, besides just, this hasn't been refreshed in a while, what other indicators made you decide to do that? Was it just not much competition? Was it like, okay, we can position ourselves as a more premium brand? Or what was it that, besides just the refresh, that made you think that this would work? Speaker 2: Well, one of the things they taught on the course was that if you could see a, you know, page one, if everything looks pretty much the same, And you can put something on there that would completely be unique and jump out and be different, then that's like a first step. That's the first like green flag. The second green flag is that if it's high demand and there are a lot of similar designs doing a lot of revenue and those two, the big two ticks there. So yeah, I think those are the main like, And we believed that we could charge an extra $20, $30 and play in that more premium space. And to be honest, it could have gone wrong. I mean, we did this based on zero experience, but it ended up being that there were people on Amazon that did want that higher priced bracket and we managed to fill a bit of a void there. Speaker 1: By going after a higher price, were you going after the same keywords as the lower price guys or were you niching it down to like some more long-tail keywords where it's easier to compete on a higher price than if everybody's on the page selling for basically the same price and here comes Phil with $20 more that a lot of times are going to ignore you or did that work for you in this case? Speaker 2: Yeah, I think, I mean, so I just do a full disclosure. I'm definitely not the PPC guy. That was definitely my business partner. So he, he'd be able to give you a better answers on that. But I believe we did just we did go after the same keywords. Yeah, we were so unique at the beginning. Unfortunately, since then, we've had a lot of copycats and our market share has been diluted in the last year. But at that point, we were so unique. It just worked a lot easier than it does right now. Speaker 1: So how much do you think COVID played in? You launched, you said, in about the summer of 2020? Speaker 2: So it was actually October 2020. October 2020, okay. Speaker 1: So how much do you think COVID played into the demand on what you were selling? Speaker 2: Looking back on it now, yeah, I think it had a big impact for sure. Speaker 1: A single SKU or did you launch a couple of products at the same time? Speaker 2: Single SKU, just one color and we sold out within, I think it was like 40 days. We thought it was, we naively thought it was like three and a half months worth of stock and it was, we sold out straight away. Speaker 1: How many units was that? Speaker 2: 500 units, so not that many. Speaker 1: And what's the price point on this? Speaker 2: So at the time we were selling for, I think we were selling for like $75, but like now we sell for like $90, $95. Speaker 1: Where have you grown? How many SKUs are you up to now? Speaker 2: In the US alone, we're getting close to 100 SKUs, I think. Speaker 1: Oh, wow. Okay. Actual different products or some of those are just variations and colors and stuff? Speaker 2: There's a lot of different variations. We've got around By the end of this year, we'll be close to like 20 different kinds of products. Some of them are within the same niche, so we have different ones within the watch organizer niche, but then we have different collector niches, essentially. We have different kinds of products and what we've done is we've got like a pro version of the original version that we have now. We're constantly trying to upgrade and kind of get ahead of the copycat. Speaker 1: What does the pro version mean? What makes it different? Speaker 2: So originally our product is a watch organizer. It has an acrylic lid so you can see your watches displayed. The Pro version has a hinged acrylic case so you don't have to lift this case off. It also has leather padding so you can rest your watches on. The original version didn't have that. So those are the main two things. But now we're adding metal rails to our drawers so it's like a smoother pull-out. So yeah, just some extra bits of flair to call it a pro. Speaker 1: So what is, you're still running the brand, you haven't sold yet, right? Speaker 2: No, no, no, no, we're still very much in it, yeah. Speaker 1: What were your sales last year and what did you hit? Speaker 2: We did like just under six million dollars in sales last year. Speaker 1: That's awesome. And you got good margins on that? Speaker 2: Yeah, good margins. Our Amazon business now makes up, so our Amazon business was pretty Like in America, it didn't grow that much last year. Last year we ventured out and we launched in the UK, Germany. We also ran Facebook ads for the first time. So that was our big area of our growth and still continues to be. We did just over a million dollars on Shopify on our own website. So that's like a big- Coming from Facebook. Yes, Facebook ads. But that all grew from, we were very much from the beginning, we invested in like building a community from the beginning so we could have the confidence that we thought Facebook ads would work for us. Because I know a lot of Amazon sellers have said that when they've tried it, it hasn't really worked. So we put a lot of like pre-work into that. Speaker 1: What about TikTok? Too expensive of a product? Speaker 2: Yeah, I think so. I think we had a call with an agency the other day and they said it could work for some of our lower selling products. But it's, yeah, I feel like we're running at so many different things at the moment. TikTok is just like blows my mind a little bit trying to look at that as well. Speaker 1: Are you doing any wholesale? Speaker 2: Yeah, we so we did just over like half a million dollars in wholesale last year without just through inbound. So It's like a big growth area for us. We, like with Shopify, we now want to attend trade shows, like we've never gone to trade shows. We would like to work with a broker. It's something that we really want to do this year because I think our product is ripe for being in like a big box retailer, department store. So yeah, it's something we really want to focus on. Speaker 1: Do you have the margins to do that? Because it takes a much different kind of way of thinking than selling on Amazon to actually sell into big box retailers. Speaker 2: Yeah, that's a good point. I mean, the margins we have selling with online retailers at the moment, granted, we work with a lot of smaller ones, but we also have a couple of larger ones. Our margins have always remained Good, because the $90 product, that's one of our lowest priced products now. We have products selling for like $300, $350. So we have a lot more margin in our newer products than we do our older products. Speaker 1: These are also watch holders? Everything is a watch holder or these are something different? Speaker 2: No, so we, the brand is, we are changing the way that people collect and organize their accessories. Previously, a collector would, in a lot of cases, their accessories would be just put in a drawer somewhere or in a cupboard somewhere. For us, we actually Offering a collector the opportunity or the chance to actually display and organize their accessories in a way that they can be as proud of the actual organizer as their accessories. And so we realized through our social media that there was a huge market in pocket knives. So we sell organizers for pocket knives, that's huge for us. We also sell organizers for coins. Being from the UK, I never thought this would be like a big thing, but challenge military coins in the US is huge. So last year was actually our biggest seller on our website, the coin deck is called. But then we're starting to get into other niches like sunglasses, cigars, and there's so many more. Speaker 1: So how do you decide which accessory to go into? Is it based on data or just based on your hunch or based on customer feedback, what they're telling you? Hey, we would love this if you did a cigar one and you're like, okay, sure, no problem. Let's do it. Or how do you validate? Before you go into, or is it just a slight modification where you can just change the marketing a little bit and say, oh, this is a cigar when we just added one extra little column over here, or how does that work? Speaker 2: Initially, so when we set up the Instagram, I ran our Instagram and I was just very much in the DMs and listening to people's feedback and people were constantly saying, you know, you should do this, you should do that. And when something comes up enough, Then you start to listen to it and then you start to test it out on Amazon, see whether it's an opportunity or not. And when we looked at the knife, Display organizer niche, it wasn't as big as the watch organizer niche in terms of demand, revenue, but there was no one selling anything premium at all, or anything. It was either these crappy little plastic things that were sold for like $20, $30, or there were these huge antique $700 things that actually sold in Q4, which was kind of crazy. So we knew there was enough there to create. We pretty much created the same design but for pocket knives. And I guess just to give you a little bit more information on how we validate now, we have created a Facebook community. Actually, I was listening to a podcast years ago, and they said they did the same thing. And we've like funneled loads of people from our Instagram and just like from other Facebook groups, I would go into other Facebook groups and kind of post in there. And funneled them into our Facebook group. And we consistently ask them for feedback on like colors, even product names, product ideas, sizes. And it's so we've gone through this process of getting people in our Facebook group, then we've started running product surveys. So most months, I'd probably say every two months, we run a product survey where we have At least four or five hundred people that respond to it. And it's a because we used to use PickFu, which you pay like three or four hundred dollars and you barely get any information. Whereas this is our actual this is our actual target market and they're telling us what they want. So we won't go to market until we've actually fully validated it with our community and we've almost got commitment from them that they're going to buy it. So we have a very, very high degree of confidence before we go to market with a product because of our community. Speaker 1: A lot of people say Amazon's all about price and you've got to be competitive on the price and you've got to, in a lot of cases, people are like, I need to be the lowest. If some guy's a dollar less than me, I've got to undercut him and kind of kill the margins. You've taken the opposite approach. And I've always said that Amazon's not just about price. It may be on commodities if, you know, maybe on, you know, a garlic press is a garlic press or something, you know, or there's slight variations, but there's not much difference. But when it comes to something that people are putting their valuables in, when they're putting their nice stuff in, you know, they've got a $5,000 Rolex. They don't want to put that in a little chintzy $20 case. They want to show it off, even if it's showing it off to their friends because they got it sitting over by the bar or if it's just showing it off to themselves. Every time they walk in their closet, that's where they're keeping it. They're like, look at my nice case and that's really pretty. I think a lot of people miss that. What made you decide to do that or was it just dumb luck or did you like, hey, I'm going to go opposite of what everybody normally does? Speaker 2: To be honest, it was actually, and I'll give them a lot of credit, the Reliable Education course, they said that a big barrier to entry is price. And if you can build something that's premium, really focused on your packaging, the unboxing experience, and offer something that's very different to what is already there, you can charge a lot more. And so I think we really took that on, because then we went and joined Titan Network, after we left Reliable and everyone there was from, is it ASN? A lot of them you have came up with. Yeah, they were all launching, they were all launching, I don't know, toilet roll holders and things like $12. And we were like, ha, have we, because you know, the one thing, it's not cheap to launch these things. So it is riskier in a way. And I think that's why they teach that ASM to do. It does mean that you're able to play in this premium space. So yeah, for us, it still is a consideration. But through selling on Amazon, we are selling ourselves short a little bit. We could sell for a lot more if we only sold on our own website. People, our customers consistently say, I can't believe the prices you sell at. But if you're still relying on Amazon, to a certain extent, you still have to play that price game a little bit. Speaker 1: Yeah, I mean, I'm the same. I'm not a believer in low price. I mean, a lot of my products are the higher price, more premium. Like I did, I've talked about this on the podcast before, but I did an Apple Watch charging dock when the Apple Watch first came out in 2015. And everybody was selling little $10, $15, $20 bamboo holders. And I'm like, if I'm spending, I don't know what the watch costs, 500 bucks or whatever it costs back then, I don't want this on a little $10 or $15 holder. I want a nice holder. So I developed one from scratch. I had all the molds made, did all the 3D printing electronics and everything and I sold it for $89. And I was able to sell a lot of them because I knew my market, I knew my customer would pay for that premium price. They were not just buying it because it's cheap, they were buying it for other reasons. And I think that's what you've hit on there. It's a message for a lot of people listening is that you don't have to be the lowest price. Now, there are times where Positioning is hard on price. Another product I did was makeup brushes, which is a commodity product for the most case. But I went out, I was like, okay, I'm going to make a cool makeup brush set. So I went to all these makeup artists that I knew and a bunch of people, models and stuff that I knew. I said, what would you want if I was to create the ultimate makeup brush set? And they told me this, I don't even know the first thing about brushes, but you need this kind of brush and this kind of brush and make sure it's this long and has this kind of Material on the end. I was like, okay, whatever. So I made this and it's like 21 brushes for $39 and a nice little leather case. But when I went to try to rank it on makeup brushes or makeup brush set, I couldn't do it. I would get to page one by doing a big launch. Back then you could do search, find, buy, and you could do all kinds of crazy discounts and stuff. You can't do anymore. So I could get to page one, but I would never stay because everybody else on page one was A makeup brush set meant two brushes for $5.99. And so every time I get on there, I couldn't sell it. So what I had to end up doing is basically reversing it, create a makeup brush set of two brushes, put that on so I could compete and then have my upsell as a variation is my $39.95 one. That's the only way I could actually Make this work. But you're saying, so one of the things I look at now is when I look at pricing on a keyword, I want to see a variety of pricing. I don't want to see everybody at the same price. Like you said earlier, Reliable told you to make sure if they all look the same, can you make something that looks different? I think that's important too. But also I look for, is there a variety of price? Like on cornhole games, that's another example. When those became super popular a few years ago, There were some selling for $39 and some selling for $189 on the word cornhole game. So I'm like, that's good. There's stuff all over the place. That means people aren't buying this solely based on price. They're buying it for other reasons too. And that's where the opportunity comes in. I think that's what you've hit on with your product line. Speaker 2: Yeah, for sure. And I think something you said earlier, when someone's spending, you've got to look at The other factors at play when someone's spending what they're spending on a watch or on a knife, then sure, they're not going to just, they would spend a decent amount of money on the thing to like organize them if it's nice enough. We have some guy put in our community yesterday, he was bidding on a pocket knife that was Like $3,000 for just a single knife and some of these guys have hundreds of knives in their collection. So I think if you're hitting on a niche where people genuinely care and there's like a feeling and emotion attached to it, then they're willing to pay a bit of a premium for that. Something that always struck me from the beginning as well was like, Building a brand around products that people are obsessed about. If you're selling toothpicks, people don't get too obsessed about toothpicks, but watches, knives, I mean, these guys are obsessed. It's crazy. I don't even own a watch myself, so it's difficult to get in that mindset, but yeah, these guys are obsessed. Speaker 1: So I was going to ask you that, were you a watch or knife collector or something, or this just presented as an opportunity, like, oh, this looks good. And now you're kind of figuring out the psychology of what these buyers are like and how to actually market to them. Speaker 2: So I did, back in my recruitment days, in my corporate days, I bought a Rolex because I was in my twenties and thought it was cool. And I still like, to be honest, it was a great watch, but I never got into that whole collecting thing. I've never really been one of those people that collects stuff, but I am a very obsessive person. So I like, even though, so I'm very honest with our community. I say like, I don't do what you guys do, but I can connect with them because I do get obsessed about like things. I get obsessed about, you know, our business, for example. And so it's quite easy for me to be in that mindset. Speaker 1: What are you hoping to do with this? Are you hoping to grow this and sell it or do you want to keep running it and just enjoying it and build it up to $10 million, $15 million? What's you and your partner's goal on this? Speaker 2: We're building to exit for sure. I met a guy at this event last year who had built and sold six businesses, not econ businesses, but he did businesses. It was all around, it's a program called Exit DNA, it's all around building your business for strategic exit, and getting, but also getting your business ready in a way where maybe you don't want to sell it. Because right now we're like in the trenches. And so it's like, okay, right now, I'd probably want to sell it. But getting yourself to a position where if someone They pay maximum value but also maybe you've built it in a way where it runs and you don't want to sell it. So I think we've got like a two-year runway ahead of us where we think we'll either exit or we'll look to scale it to a whole other level beyond that. Speaker 1: How big's your team? Speaker 2: Including freelancers, like between 10 and 15 people. Speaker 1: Everybody's remote? Do you already have an office where someone works somewhere? Speaker 2: No, five different continents. Yeah, completely remote. Speaker 1: What do you think is the number one thing that makes your product stand out over everybody else? Is it the craftsmanship? Is it the look? Is it the lacquer that's on it? Or what is it or the functionality? What is it that is your really unique selling proposition? Speaker 2: I think our USP is that there actually isn't another brand who does what we do. If you look out there, there isn't a brand that is a solution to a collector's problem. There might be a watch organizer brand, there might be a knife case that you can throw your knives in. There isn't a brand who actually does what we do on the level that we do it at. But the other thing is we If you look at our commitment to the customer experience, we spend an obscene amount on our packaging. So when a customer first experience that product, They can't help but write a review. If you look at our reviews, it's full of, it's half about the product, it's half about the packaging. Again, something that Reliable spoke about. And then also our customer service. We just have, I read a book, the guy who started Zappos, Delivering Happiness. And it just really stuck with me, his commitment to customer service and his commitment to just not If a customer issue came up, customer service issue came up, he wanted them to walk away from that issue almost being happy that it had happened, because then they'd come away just with a positive experience. And so for us, it is that commitment to quality, that commitment to unique design, that commitment of Doing something that no one else is doing, but then ensuring that that customer experience is the smoothest possible experience that they just, even though they don't normally write reviews, they just feel compelled to because they've had such a great experience. Speaker 1: Is it a box? Is it like an Apple box or something? And when they unbox, it's just a really nice box that they don't even want to throw away, or they feel it's part of the product itself. It's not just there for protection. It's like, Well, I'm going to keep this and keep something else in it. Or is it something like that? Speaker 2: Yeah, exactly. We had a customer the other day post in our Actually, no, they sent us an email and they'd like recrafted our box to repurpose it in another way because they couldn't bear throwing it away. It's like that nice. So yeah, and we based it on the Apple box kind of, you know, when you, it's so tight and you pull it out and it just has that, it's that feeling that you have. So yeah, it's something that we focused on a lot and we continue to this day. Speaker 1: Yeah, people eat with their eyes first. A lot of people don't realize that. What's the matter? It's not in the store. I just put it in a cheap little box, but it validates that they made the right decision, especially there's been, like you said, one of these is $350. If it shows up in a chintzy little box or wrapped in plastic, they're like, what the hell? It doesn't actually convey that you made a good choice spending $350. For that extra buck or two bucks that you spend to make that package, it goes a long ways in customer confidence and like you said, in leaving reviews. What are you doing to drive outside traffic? Are you using any influencers? Are you doing any Google stuff or Facebook or anything like that? Speaker 2: Yeah, so from the beginning, we started working with influencers straight away. It was a bit of a scattergun approach at the beginning because I don't think we fully, fully understood our customer avatar at the beginning. But then when we did, we really hammered down on that particular niche. And so what we realized, which we've been really lucky, the influencers just are happy to work with us because they want the product. So to this day, we've still never paid an influencer, we've just given them the product. And we're also quite lucky that one of our- No commissions or affiliate commissions or anything, just here's the product? We've now set up an affiliate scheme, but even a lot of our biggest influencers, they don't care because it doesn't bring in enough money. They get paid a lot more than that normally, so they just do it because they want to feature our product. But we got picked up by a guy called Pete McKinnon, who has 6 million subscribers and like 5 million Instagram followers, actually bought our first product himself. And I was on, I was like the customer service at that time. So he was emailing me saying, I've got a problem with the delivery. And I was like, I know that name. I looked it up and I started speaking to him. And I just said to him, look, is there any way you might feature it on your stories? And he said, actually, I'm gonna put it in my gift guide for Christmas. And I was like, we've just run out of stock. And then he was like, well, could you set up a pre-order? I was like, yeah, I guess. And so we figured out how to do that. And he featured it in his gift guide. And that was a game changer for us because we kind of then were known by a lot of these other influencers that all wanted to work for us. And since then, we now work with, we're doing a giveaway this month with a YouTuber with over half a million subscribers with two other really well-known brands. And we continue to do stuff like that. So influencer marketing has always been a big part of our strategy. Yeah, and then outside of that, we have like an SEO, Like freelancer that works for us, he does a lot of work on our website, tries to get us ranked on Google. We run Google ads as well. Yeah. And Facebook ads as well. Speaker 1: So when you come out with a new, do you have a mailing list of customers that, so that when you come out with a new product, you can message them and say, Hey, go buy it on Amazon or go buy it on our Shopify site or something like that. How are you getting those names and email addresses? Speaker 2: Up until towards the end of 2022. And I'd actually always remembered you saying, That was like a big, big focus for you of like building an email list. And for my business partner, he always referenced you actually talking about building an email list. And we were always like, we'll get around to it. We'll get around to it. I mean, we realized we, I think we had like 3000 emails at the time. But we brought on a, what is our brand manager now? It's this super intelligent, if he's listening to this, you know, experienced boss. He was just an Amazon, just ran Amazon PPC before, but really hungry, really intelligent, really ambitious, always wanted to look at, like be more of a brand manager. So we hired him as our brand manager. And one of his goals was to Optimize our website and drive more traffic to our website and get more email signups. And through everything that he's been doing, and I don't know all the different things that he does, but definitely our website optimization, we've built up to like 25,000 email subscribers now. So with the goal to be, we're trying to get towards 50,000 by the end of the year, because we were only, as I said, we were only at 3,000 like just over 18 months ago. Speaker 1: What are you doing to get that? These are just coming off of orders? Are you offering them some sort of... How do you download this guide to the best watches in the world? Are you using reversion or retention? I mean, are one of those sites that just grabs the emails from anonymous visitors or how are you getting those? Speaker 2: A lot of it's through his work. A lot of it's through the experience they have when they come on our website. So I guess it's initially the traffic we're driving to the website and then actually obviously when there's the pop-up that people get, you know, if you get discount by signing up to our email list. There was also when people are at checkout, it was if you want an extra 5% here, so they'll be about to check out if you want an extra 5% here, sign up to our email list. There's a lot of different ones like that. We've also We drive a lot of traffic from our Instagram. So our Instagram is like 30,000 followers now and they're all like organic even though Instagram restricts a lot of the content. We've driven a lot of that to our email list. Speaker 1: Why are they restricted? What do you mean they're restricted? Because it's knives or something? Something to do with knives? Speaker 2: Yeah, so we get a lot of restricted content because of knives. So recently we found our reach has just dropped a hell of a lot compared to what it used to be. But yeah, that's just Instagram unfortunately. Speaker 1: What are you doing to maintain the quality? Have you visited the factories in China? Since you're over in Bali, you're not too far. Have you gone over there and visited them or what are you doing to maintain the quality of the brand and keep the standards high? Speaker 2: Yeah, so first of all with our inspections we do like a 100% inspection so our factory knows that we're going to inspect every single product so there's going to be no getting around that. Because at the beginning we were going to do like a lower percentage and we've realised For this kind of product, we couldn't afford for there to be many slip ups. When we did the maths on it, it's like $180 per mandate. So it just worked out, given the premium price of our product. So that's one thing. The other thing, we have been over to China. But obviously, we couldn't go to China for the first 18 months of our business. So we started working with an agency in China who I don't even like calling them an agency. I feel like they are part of our team. They're an extension of our team. And they run that operation for us. So they know the process inside out. And they are there with the inspection team, making sure that there are no issues. And when there are, then they sort them out. There are still issues, but not to an extent where it causes us any problems. All of our ratings on Amazon are at least 4.7, 4.8 and above. Speaker 1: How'd you cash flow your growth? So you started out, we said, with 500 units in the beginning, and now I'm assuming you're ordering a lot more than 500 units at a time. How'd you cash flow this? Do you have deep pockets, or do you have a rich uncle, or loans? Are you financing or picking up quarters under Coke machines or how do you do it? Speaker 2: I think with a lot of this, it's good to be so naive in the beginning of like how you're going to scale this financially otherwise you probably wouldn't get going in a way. At the beginning we didn't really understand cash flow, now we do. Because it's, yeah, even when you're doing a lot of sales, when your lead times are as long as ours, cash flow is like a huge thing. We used our own money in the beginning. We managed to get a loan from the government through COVID, which really helped. And then we started using like SellersFi, like sellers funding, and a business called Forever8, You actually place your POs for you on certain SKUs and we'll fund your SKUs and you pay them back when you've sold that product. Now we are in the process of, we're pretty far down the process of getting more of a longer term loan with a traditional bank like HSBC in the UK. The issue we have had is that we're a US business But we're from the UK, so whenever we've tried to engage with a US bank, they always want a social security number, some kind of credit history. And then when we try to engage with a UK bank, because we are a US company, it's been very difficult for us. So that's the next step for us. We really need to engage with a more of a traditional bank so we can get better long term lending. Speaker 1: Hey, what's up, everybody? Kevin King here. You know, one of the number one questions I get is how can you connect to me? How can I, Kevin, get some advice or speak with you? or learn more from you, the best way is with Helium 10 Elite. If you go to h10.me forward slash elite, you can get all the information, sign up for Helium 10 Elite. Every month, I lead advanced training where I do seven ninja hacks. We also have live masterminds and every single week, one of those weeks I jump on for a couple hours and we talk shop, we talk business, do in-person events. Helium 10 Elite is where you wanna be. It's only $99 extra. On your Helium 10 membership it's h10h10.me.me forward slash elite. Go check it out and I hope to see you there. When you first started the business you just kind of kept your head down and we're just working but you mentioned that you know reliable they I think they just had an event not too long ago or they're a branch of them and Australia, maybe one reliable somebody. And also you said you're in Titan. Do you get out to some shows or since you're in Bali, there's not much going on. So do you get over to Hong Kong or anything for anything like global sources? Or are you starting to try to get out there a little bit more? Or are you still just keeping your head down and just doing your thing and enjoying Bali? Speaker 2: When we started this, I was like, said to my business partner, I want to go to as many events as I possibly can. And then when it came down to it, all of the All of the money that we were earning, we were just putting back into the business. So it just found it difficult to justify spending $5,000, $10,000 or whatever it might be on each trip. I think it was down to me, I probably would have done each time, but then I spent too much money in the business. But we joined Titan, so we went to two of their events in Cancun. We've been to Seller Sessions. But yeah, beyond that, I've been to a few DTC events. But beyond that, haven't been to too many other ones. This year is a year that we wanted to go to a lot more. So in the second half of this year, yeah, we'll definitely be getting to more events. Your event is definitely one we will be coming to one day. I think we were gonna try to go to the Hawaii one this year, but I don't think it's gonna work out. So if you're saying, did you say Iceland next year? Speaker 1: Yeah, next year. Yeah, we just did Hawaii and Iceland is late March, early April next year. So it's close to the UK. So you could go visit family and it's a two hour, two and a half hour flight from London. So easy for you. Yeah, so the next one's in Iceland at the end of March, early April of 2025. It's going to be a fire and ice, volcanoes and glaciers. It's going to be really cool. Speaker 2: Wow. Yeah. Okay. Well, I'll get my business partner on that. We'll definitely do that for sure. Speaker 1: They're good events. I mean, they're not cheap, like you said. It's a time commitment. It's a money commitment, but one of the reasons the price is, they're not big money makers for me, but the price is high because we go all out on them, you know, as far as everything. And it's also, it's a barrier. So, you know, you want to be around people, you always want to be around people that are one step ahead of you. So, if you go, you're doing 6 million, you go to an event and everybody's, you know, just paid $199 for their ticket and they're just starting, what value are you going to get really? Not too much, but if you go to an event where it's $5,000 a ticket, there's guys that are doing $50 million, $100 million that can afford that. And you're like, okay, this is where I need to be because I'll learn something from them. And so that's one of the reasons that it's expensive is to pre-qualify the people that are there. Speaker 2: Totally. The event I went to last year, it wasn't an Amazon event, but it was just an entrepreneur event. I spent $10,000 on that, but it was the value I got out of that, the people I met who were doing things so crazy beyond what I could ever experience. The guy I mentioned who'd exited six businesses, he owns a football team in Spain now. You just don't get those kinds of conversations through going to your everyday run-of-the-mill events. Speaker 1: Are you still in Titan now? Speaker 2: No, no, we left Titan. I do think they're a great network. I just think when you get to, for me, for us anyway, when we got to a certain level, maybe, and also I think with stuff like that, you have to be really involving yourself in the community. So I don't think we were doing that that much. And I think maybe we just got to a level where we weren't getting as much benefit as we were before. Speaker 1: Well, Phil, man, this has been great. I really appreciate you taking some time to share your story here and this should be inspirational to some people. You said you've been listening to the AM-PM Podcast for a while? Speaker 2: Yeah, yeah, pretty much. I'd say the whole time you've been doing it, I've been tuning in most weeks. So yeah, yours is one of the podcasts that comes high on my list when you release a new episode in Apple Podcasts. Speaker 1: Awesome. Do you get the newsletter too? Speaker 2: No, no, I don't get the newsletter. No, I should sign up for that though, I assume. Speaker 1: Yeah, I'm disappointed now. I can't talk to you anymore. I only mention it on every podcast. I guess I'm not doing a good enough job in my marketing. If you haven't gotten Phil to sign up, go to BillionDollarSellers.com. It's totally free. Every Monday and Thursday, people say it's like getting a $25,000 mastermind free in your inbox. It's not a bunch of marketing stuff. It's like actionable, real stuff. So you got to sign up. And everybody else out there listening, you need to sign up because it's true value. It's not like everybody else's newsletter. It's just a bunch of pitching and go buy my service and whatever. It's real value. It's news about what's happening and actually techniques that you can actually apply. That are not being talked about, especially people at your level, there's going to be some value in every single one of them. Speaker 2: Awesome. I'll go and do it right after this recording. Speaker 1: I want to watch it right now. So pull out your laptop. I want to see the website on the screen and make sure you do that. BillionDollarSellers.com. Phil, I appreciate you coming on, man. This has been fun. Thanks again for joining us on the AM PM Podcast. Speaker 2: Awesome. Thanks, Kevin. Appreciate it. Speaker 1: Hope you enjoyed my talk with Phil and got a little bit of inspiration and some good little nuggets out of that. That was great stuff. Someone that hasn't been doing this for a long time but has already found awesome success selling at the higher end of The spectrum, it's not just always about low price. Great stuff, Phil. Thanks for coming on. We'll be back again next week with another incredible episode. You don't want to miss this one. It's pretty fun. But before we go, I've got the traditional words of wisdom. Kind of goes into what Phil was talking about in this episode. Know your customers why and you will connect. Know your customers why and you will connect. Focus on the emotions to sell. That's exactly what Phil talked about and exactly why he's having great success. To your success, and we'll see you again next week.