Brian Berger was frustrated with the shopping experience for essential menswear items and felt the department store experience was overwhelming for most shoppers. He created Mack Weldon in 2012 as a functional and stylish direct-to-consumer solution. In this episode of Shopify Masters, Brian shares with us the strategies behind a sold out launch and how to identify the right partners for your business.
For the full transcript of this episode, click here.
Show Notes
- Store: Mack Weldon
- Social Profiles: Facebook, Twitter, Instagram
- Recommendations: Algolia (Shopify app), Happy Returns (Shopify app), Looker, Toolio
Finding opportunity in everyday essentials
Felix: The idea behind this business all started due to a frustration that you've had with shopping. What was the problem that you were trying to solve?
Brian: It was specifically the problem of shopping for underwear and socks. I hated going to department stores and having to sift through a never-ending sea of products. I was never able to find the same product that I had previously bought and loved. There was so much about the experience that didn’t sit well, that just felt really broken and at odds with what should really be a convenient experience. Guys typically buy things–especially socks and underwear–on a replenishment basis, and nobody was making it easy to do that.
A light bulb went off at that moment, where I thought “there's got to be a better way.” So we set out to reinvent men's basics, and a big part of that was customer experience driven, but then there was obviously also the product component as well.
Felix: How did you know that the problem you were facing was also an issue for others? How did you know there was an opportunity here?
Brian: That's a great question. Entrepreneurs spend a lot of time trying to assess the market opportunity and whether or not there actually is a problem. I would say I was solving for myself as a consumer and I'm not particularly high maintenance or low maintenance. I'm right in the middle as it relates to shopping, clothing and the degree to which I care about those things. It was really just informally surveying a lot of guys. What was particularly interesting was when you get into conversations with guys about their underwear, T-shirts, and socks, they actually have a lot to say.
You click the door open and there's a lot of thoughts there with respect to not just the shopping experience, but also what they love and don't love about products that they are currently loyal to. There was a lot of that informal surveying of peers, friends, family members, etc. Then we did some light, more official market research, where we sent a survey out to 100 people we were close to and asked them to forward it on to 10 more people.
We got a decent number of responses to test out certain things, but there wasn't a ton of testing. We believed in our gut and then validated through information that we received from others. We realized that this was a pain point, and if we could solve it, we had a real opportunity. Another big aspect of it was this notion of replenishment. Once there's loyalty, the process of replenishment should be really easy, but buying stuff through a retailer or department store isn't. By design those places are engineered to always have new, ever-changing assortments of product. They don't get excited about having the same old thing over and over again. That results in a bad experience. Once you find something you like, you want to know you can go back and get the exact same thing again and again, just like Starbucks and McDonald's. We were really able to tap into that.
The winning duo: Customer experience and product innovation
Felix: Was there anything else that you learned from that initial research that had a big impact on the direction of the business?
Brian: A lot of discussion around technical details and functionality, which was great because we were focusing on that. We’d ask, "How do we match up to Lululemon and all the good things that they do for performance apparel and Calvin Klein who was like the 800 pound gorilla in boxer briefs and premium men's underwear." How do we match that? That was our product strategy. What we found was that there was a huge appetite for product innovation around features and benefits that more directly address the customer experience. For example, undershirts that are a little longer so they stay tucked in and a little more fitted so they don't bunch up. V-necks that sit below your collar button. So if you're wearing a dress shirt and the top button is unbuttoned, you don't see the T-shirt underneath peeking out. Little things like that.
Felix: You mentioned there were two key areas of focus when you started the business: customer experience and product innovation. Was there one that was more important when first started out?
Brian: They're equally important because we could have designed the best product on earth, but because our go to market strategy was digital first, if we didn't design a customer experience that felt unique, interesting, and compelling, it would be difficult getting people to engage with our product. It's not like we were relying on Nordstrom to do it for us. On the flip side, we could design the best customer experience on earth, but if the product didn't deliver, then it would all be for nothing because we wouldn't be generating that good first impression and loyalty, which is core to our business model. We really spent equal time on both things.
Felix: Can you describe to me what that first commercial attempt at putting something out to market? What was that experience like?
Brian: It was pretty intense because this was before you were able to kickstart things and do advance sales or beta test products. We effectively built and invested in a lot of foundational things. That included a website, a brand identity, and not only the product development, but the actual inventory itself. We had made a pretty significant economic bet prior to having sold a single thing. Part of that decision was, should we focus on one product, or should we focus on a handful of products? We ended up choosing the latter strategy because we felt that if we wanted to maximize brand equity, we would need to tell the story across multiple products. That it would reinforce our brand from a product standpoint.
It was a bet, but it was a bet that paid off. We invested in a proper launch where we had PR, we had influencers, we had organic PR people we went to through our own networks. We leveraged friends and family and our personal networks to virally market, not only our site, but also our social feeds. We did a major press push where we did deskside with editors. It was a full-on process. We also had some marketing. We wanted to test some digital marketing so that we would have some of those initial metrics to help determine how we were going to build and grow that side of the business as well.
Brand identity first, product second
Felix: You took a big bet, investing in your brand like that, creating a whole brand and product line before selling a single thing. Not a lot of businesses can pull off something like that. Is there anything that you guys did in particular that you think contributed to your success?
Brian: We always thought about this as a brand and a bigger opportunity versus, how can we sell a specific product? A lot of what you see now in the DTC landscape is singular or highly focused product campaigns being executed really well on Instagram and growing meaningful businesses, but there really isn't much beyond that. Now, it’s about how quickly and efficiently can we drive the sale of this one product? For us, we were looking at brands like Lululemon, Patagonia, and Nike. Brands that have earned the right to do other things over the course of time.
We felt that in order to do that–in order to put our best foot forward–we would need to make a bigger upfront bet because we didn't want to be seen as, "Oh, just a company that makes cool socks." Or, "Oh, just a company that makes cool underwear." We really wanted it to feel bigger than that in a consumer's mind and give themself the opportunity to do more. That was just a choice that we made, it's not necessarily one that is a one-size-fits-all situation.
Felix: You focused heavily on building a cohesive brand story. How do you build a brand like that?
Brian: It's multifaceted. It's a brand strategy. It's a narrative. It's a point of view. I would say that piece of it, we probably spent the least amount of time on. We're actually spending a lot of time on it right now. We're coming to market with an evolved brand strategy that will position Mack Weldon the brand and why it's important for customers to associate with us from an emotional perspective. There's an aesthetic piece to it, what does it look and feel like? There is a product piece to it, which is, what is the product strategy? Is it fashion, is it technology and innovation?
Really nailing that and being very specific about that is crucial to product branding and marketing. How do we have these design signatures on the product that tie it all together so that when consumers are wearing the product there are certain things that are visible, notable and, distinguishable to us? It's a series of things that are tangible. What the product is and what your approach is and how you market. A brand represents your point of view and your narrative. It could be a sustainability narrative, it could be an innovation narrative, which is what we chose. It could be an altruistic narrative, one-for-one. Warby Parker is a leader in this space. They were very big on this one-for-one model. It's not all just sort of fluffy subjective things. There are very specific things when you get down to it.
Felix: Building an entire brand can take a lot of time and effort. How do you know you’re headed in the right direction when developing your brand story?
Brian: There are things that you measure and look at day-to-day. You look at metrics like new customer conversion rates, and then you look at whether it’s resonating, it's longer-term metrics, such as repeat rates and repeat frequencies. Are people buying more in each successive purchase? Are they coming back? What does it take to get them back? Are they buying more of the same thing? Are they buying cross category? There's a lot of those types of metrics you can look at to gauge the efficacy of your value proposition. Then at the brand level, there are things that you can do to track the awareness and consideration of your brand just by surveying segments of the population. Those are two ways.
Minimum Viable Product? More like Multiple Viable Products
Felix: When you first launched, what were the products that you had on hand?
Brian: We launched with underwear. Three different styles of underwear, boxer brief, a trunk, and a brief. We launched with T-shirts and we had a V-neck and a crewneck version of the T-shirts. We launched with socks and we had solid socks and patterned socks. We launched with undershirts–V-neck and crewneck undershirts. It was not a small assortment out of the gate. It was scary.
Felix: The product development process must have been quite hectic, with all those different lines. What was that process like, developing so many products simultaneously?
Brian: It was really hard. We were fortunate in that we ended up partnering with a person/small agency that remains a long-term and integral partner of ours. They really helped in that initial product development phase and their whole way of working is they take concepts from the ideation phase all the way through the commercialization phase. Everything from design, development, sourcing, production, and ultimately landed goods in a warehouse. Through that process, we were able to get not only a very high quality of differentiated product, but we were able to have it delivered on time, on budget and without any issues–which is also critically important. If one thing goes wrong in those early days, it could be pretty catastrophic.
Felix: How would you suggest finding a partnership like this, to someone out there who might be looking for an agency to help with this stage of business development?
Brian: For soft goods and hard goods like bags and accessories there are many agencies out there that do full package solutions for emerging brands and companies. Part of the entrepreneurial journey is figuring out how you're going to get your product made, if it's a product type of business. Getting to the right place is a little bit of a predictor on how successful you're going to be because there's a lot out there and the choice isn't always obvious. We had the choice to go and do this directly–which we now do a lot of, more than 50% of our business is direct relationships that we have with manufacturers. In the early days, obviously we wouldn't know where to go or how to get stuff sourced, and it would have been a much more labor and time intensive process than what we ultimately ended up with.
Outsourcing, not offloading: Stay involved every step of the way
Felix: Given your experience, how do you vet who's going to be a good partner to work with?
Brian: The best source for anything, whether it's a marketing agency, this type of an agency, or a tech-related agency is to call references. The best kind of references are back channel ones, where they don't know you’re calling. Find out who they partnered with, look on their website, do some LinkedIn searches and then go and try and reach out to somebody to get a real honest perspective on how it all went.
Felix: What was your involvement like throughout the process while working with this agency, to make sure that you had the deliverable that you expected?
Brian: It really depends. If you're doing a photoshoot, for example, there's a process that you go through where you pull inspiration boards and swipe. That's all really meant to help inform the end product that you're looking to get. It's not dissimilar here where you're looking at fabrics, you're looking at trends, you're looking at design boards, which are just like CAD designs and then you go through a prototyping process. First proto, second proto, third proto.
I remember the first prototype meeting I went through. I literally almost jumped out the window because I had never been through this before. What was presented to us was so far from a finished good. There are just things you need to know, when you get prototypes, they're in available fabrics and yarns. They're using available trim colors. You know what I mean? It could look like a Raggedy Ann doll because of that and not because of anything else. Those are the things that you learn. Then as you go through each iteration, it gets closer and closer to what the end result will look like. In product development specifically, there is a prototyping process. It's usually three or four rounds before you get to the final, "This is what we're making."
Felix: You mentioned that you now have more direct relationships with manufacturers. What was the foundation that helped with that transition?
Brian: Hire great people with experience to do that vetting. I've never managed those types of relationships in my background. We hired the head of design for Calvin Klein underwear, and over the course of time, he brought over members of his team, so they had preexisting relationships. They had vetted some of the best manufacturers, mills, and spaces that we play in, at scale, and they were able to forge and formulate those relationships.
Hire for your future business
Felix: You said that you hire for the business that you need tomorrow, versus the one that you have today. Did you learn this the hard way, or was this always a philosophy you had?
Brian: There's two things at play. One is you're always trying to be really efficient with your resources. You don’t want to be overstaffed. The other thing is that there's this false perception that if and when you need somebody, you're just going to snap your fingers and in 60 days you're going to have somebody sitting in a seat. That's not the way it works. Talent in this market for what we do is highly, highly sought after. You've got to really hustle to get good people. When you need someone–when you really need someone–you're anywhere from 60 to 120 days with an earnest search to get a high quality candidate.
My point is just that you should be really honest about your hiring plans and what your needs are going to be. Try and formulate a plan, or at least get a process in place that you can activate in short order, to get good people in because it's hard.
Felix: How do you anticipate these needs? Are there signs you look for when you’re gearing up for a big search like that?
Brian: In order for people to be effective in their job and feel like they are progressing in terms of their career development, you really need a 70-30 split of their time. For example, if somebody is working at a 100% capacity all the time, then they're likely going to burn out and they're likely not going to be able to expand their portfolio of skills beyond whatever that one thing is. As you look around at your team, if you've got a bunch of people working at a 100%, then that should be a pretty good alarm bell to say, “it's time to add some resources here so that we can give people some capacity to think about other aspects of the business or to help show whether or not they could evolve their skillset.” You want to get the best out of people.
That's one thing. The other thing is that early stage companies are riddled with single points of failure, so one person doing one job that's critically important to the company. It's important to look around at who those people are, what functions they're serving, and what you would do if they disappeared one day. Think about what a succession plan looks like for those roles.
Mack Weldon’s tried and true hiring strategy
Felix: For folks out there that are hiring for the first time, what were some of the early lessons that you learned about hiring?
Brian: It's really important, it's really hard and it's something that you should take very seriously. By that, I mean having a real process in place. One that involves multiple people screening for very specific, different things. Maybe one person's screening for skillset, another is screening for culture and values, and yet another for some other attribute. Perhaps attributes that are going to make somebody successful in a startup, like tenacity and self-starting and things like that. Make sure you have a real plan going into it, and you have a real process for getting all the information aggregated as you move somebody through the process.
I'm a huge fan of giving some sort of project or test, where you can actually test somebody's skill set or competency or get a sense for their ability to synthesize information and to present it back in a clear and cohesive way. That process takes the subjectivity out of it like, "I like that person or we had a great conversation or we grew up in the same town." Those are things that matter, but they're not really important to me. They tend to carry too much weight in the hiring process.
Felix: What is the onboarding process like? How do you make sure they hit the ground running?
Brian: That's an area that we've made enormous strides in. The first impression is really important. Make sure that that hiring manager has a 30, 60, 90-day high-level game plan for that person, and that the person's schedule is full of meetings for the first week or so of their onboarding, so that they're getting to meet as many people as possible, to better assimilate them into the company. At the same time they're learning who the key cross-functional partners are for them. On the cultural side, we do this thing where you have a lunch buddy on your first day where a person from a different department takes you out to lunch.
Having everything ready, being really buttoned up about it, not treating it casually, etc. Don't have the person start at nine o'clock on a Monday when you're going to be digging through your emails. Make it 10:30 or whatever time you're going to be coming up for air and then really overinvest in that process. It’s very important.
Felix: You mentioned earlier a big launch of all your products. Once the launch was done, how were you able to keep the momentum going, to build out the brand?
Brian: That was really scary because the first fear was, "Are we going to sell anything? We have a warehouse full of inventory that cost us a lot of money." Then that quickly flipped to, "Oh, no, we're going to sell out. We've got all this demand that we've generated, how are we going to meet that demand? Now we're going to buy more inventory, what does that flywheel look like?" It's just a series of escalating calculated risks that you're taking, but in a consumer business, you can't grow, you cannot make it work if you're not prepared to own the product, to meet the demand. In our world–in the DTC or the e-comm world–it's particularly stressful because you don't really have any visibility into demand.
The demand can come as a function of a really successful Facebook campaign and then it could be gone. It could just go away. It's not like a traditional business that's sold in a department store that knows what its purchase orders look like. 80% of its demand is accounted for before a purchase order is placed. Then maybe you buy a little extra just for opportunistic things. DTC is different.
Create a solid foundation by optimizing your supply chain
Felix: How do you minimize the risk of that demand just disappearing?
Brian: It's very hard to do. You can optimize your supply chain to the best you can–some of the companies that have had a lot of success, have supply chains that are very responsive and flexible. They're able to get back into production in a very short period of time. They don't have to forecast as much. In our case, we have some natural benefits to our product category in that there isn't a whole lot of seasonality, fashion risk, or diversification.
What we have is evergreen. If we overinvest, we just sell it in the next period. It's not like it's a ski jacket and if you don't sell it all by February, or you're going to be marketed down into the abyss. It's not a one-size-fits-all type of answer, but I think that being as data-driven as you can be and really trying to shorten up the supply chain as much as you can without taking on risk, those are all ways to do it.
Felix: What's the response for the opposite case, where something that was working all of a sudden isn't?
Brian: You have to figure out alternative ways to try and make it work. There are obviously other ways of distributing products if need be. If it's a seasonal product, you can decide whether or not you want to put it out into a discount channel or sell it through a third-party–maybe cut a deal with a retailer that isn't going to compete with you and your channel. Maybe you want to say, "Hey, let's just donate the inventory." That’s a great example. Everybody who made masks is now sitting on hoards of masks because demand for masks is virtually gone.
So what do you do? We did something where we had people at the center handing out masks to newly vaccinated New Yorkers several weeks ago when the mass mandates were still in place. It wasn't where we are now. That was kind of a cool PR customer acquisition strategy. You can donate them to countries or places where they're not as far along in the fight against COVID. There are things you can do–maybe generate some marketing from it, but if you have a core fundamental distribution problem, like the ads that you're using to drive your core business are no longer working, there’s a bigger problem and requires a real strategy to fix.
Felix: So you had this big launch and ultimately ended up selling out of your production line. What are the key things you did to ultimately result in this success?
Brian: In addition to the traditional PR–an agency setting up meetings with editors for us to go out and introduce the brand and showcase the product–it was our hustling to get the brand and the story in front of editors that don't necessarily subscribe to a traditional PR approach. It was those editorial features that moved the needle for us in the launch period. It also created evergreen content about the brand. When somebody writes an article about you and then somebody searches Google for Mack Weldon, now they're seeing a third party endorsement of us. That really helps make the marketing more efficient, because you have–hopefully–a higher conversion rate, now that somebody is seeing validation of your brand.
Felix: What was your next area of focus, once doubling down on marketing and selling out?
Brian: It was really making sure the supply chain was going to be able to deliver for us. And then the other piece was really proving out the marketing strategy. Can we demonstrate that we can cost effectively acquire customers through paid channels?
Keep ‘em coming back for more
Felix: What was your strategy to acquire customers through paid channels?
Brian: One of the first hires we made with somebody who really had a lot of expertise in not only customer acquisition, but retention. We wanted to build out case studies to showcase that we can spend a budget that would hopefully grow our Facebook and search to get customers in and then demonstrate that those customers exhibited a certain behavior over a reasonable period of time. Starting to prove out this customer unit economic equation. Spent X to get a customer. The contribution of that customer on the first order is this, the equation is positive, negative or neutral. And then all subsequent transactions by that customer that didn't have a marketing cost associated with them then add into the profitability. We were trying to tell that story because we were going to be setting out to fundraise and we knew that that was going to be an important question that we had to demonstrate to investors.
Felix: Is there a different approach or strategy that you take with a customer to encourage repeat purchases?
Brian: Well, there are different types of customers for sure, but at scale you're looking at averages. Now we segment and target different types of customers in different ways, but at that point in time, we were just looking to demonstrate that we could do it at a reasonable level of scale.
Felix: When you look back on it, what seemed to work best to retain a customer?
Brian: The product is a big part of that story. They have to obviously like what they previously bought, but we're dealing with guys. There has to be some sort of a nudge to get people to shop. Really compelling email marketing with thoughtful subject lines and great creatives that highlight the features and benefits to get straight to the point. That was our strategy and it worked quite well.
Over time, we developed more of a lifecycle email approach where in addition to mass customer marketing about the product, a new product launches and we're doing much more tailored messaging to different customer segments. A customer who's 30 days out from that first order is getting a certain type of messaging flow than say a repeat loyal customer that's in the highest tier of our loyalty program.
The key to staying focused: Define and measure objectives
Felix: You mentioned that there are so many opportunities to lose your way in every area of business–from product to marketing to people. What’s your approach to staying focused?
Brian: With respect to time, it's really just a function of making sure that projects are well-defined and teams are very clear on their objective and how it's going to be measured so that you're not spinning your wheels in search of an objective that isn't what is in line with the strategy. With capital, same thing. It's really trying to have your arms around what things cost and what their ROI looks like before you're charging down the path because oftentimes it can be too late. With respect to marketing, digital marketing and things of that nature, cost can escalate really fast. You have to really have control over how you're defining success and then make sure you have visibility into that on a real-time basis.
Felix: Let’s talk about the website. What are some of the changes you’ve made along the way that have had a positive impact on your growth?
Brian: We've replatformed to Shopify, that was a big change. We went from essentially hosting and maintaining our own ecommerce code base to Shopify, which was a pretty bumpy transition that had less to do with Shopify and more to do with how the transition was managed. Now that we're there and comfortable and settled and we've got real pros working on our platform, it's been fantastic. It's really enabled us to focus on the things that matter to our business, like what the digital customer experience is, and providing a best in class checkout flow, analytics and integration of apps.
"Shopify has really enabled us to focus on the things that matter to our business, like what the digital customer experience is, and providing a best in class checkout flow, analytics and integration of apps."
In terms of what are the most important things to drive customer acquisition or conversion, it starts with speed. We spent a lot of time in the early days of Shopify trying to optimize for site speed. They can take for granted how important that is, but it was a pretty big needle mover for us. Then there's just other feature driven things. How you lay out the product detail pages, the imagery that you use, search functionality, how you organize the navigation, etcetera.
Felix: What are you looking at to measure something like digital customer experience?
Brian: We A/B test everything, not everything–but the important things. If we're making a change, we run A/B tests to understand whether or not the test is the same, better, or worse than the control.
Ease your engineering load by letting apps work for you
Felix: Have there been any changes recently that you have tested that have had a big lift?
Brian: We recently added search, which was a really big upgrade for us where we integrated a third-party application that is called Algolia. So we were able to integrate that app as we've grown the product line. Having that has been really positive in terms of discovery. The other thing that we recently did was we totally reorganized our navigation in a much more intuitive way. Customers are able to find products that they may not associate with us, due to the better navigation.
Felix: Are there any other apps that you rely on to keep the website or the business running?
Brian: We're very happy customers of Happy Returns. Happy customer, Happy Returns. It's really made our reverse logistics and returns workflow so much more streamlined. We previously had a custom app built for returns that was really complicated, overengineered, and something that we were spending a lot of time on. Happy Returns and that smooth integration has not only delivered on a better technical experience, it's also resulted in a much better customer experience. It's saving us money as well. And then we use Looker for analytics. We use Snowplow for data. We use something called Toolio for our merchandise planning.
Felix: Do you have any examples of things that you’ve found when analyzing the data that you wouldn't have found from a qualitative observation?
Brian: We have a loyalty program that has certain spend thresholds associated with it. We generally have the belief that some of the tiers of the loyalty program were driving behavior customers would spend to get to that level. If we were to remove that level–that interim level–would our average order value go down because customers weren't reaching for that level? They no longer had an incentive to reach. The counter thought was do the customers even know about that middle tier? Is it even part of their consideration?
It's great to be able to have the data to test that to understand, "Well, if we remove this feature, will our average order value go down or are they going to stay the same or potentially go up because that feature is applying a discount that may not even be understood by the consumer at the time they're filling their cart." That's an area where we're able to test and understand what the impact is. In that particular case, we learned that it didn't really have a big impact. In fact, we were giving people a benefit that we weren't really getting any credit for.
Felix: What do you think has been the biggest lesson that you or the company has learned over the past year that has had an impact on the direction of your business moving forward?
Brian: We've learned how much we can do in a resource constrained environment, we faced enormous adversity in a sense that we were all of a sudden all working remotely and we couldn't meet to do creative things, product reviews, or all the things that we have historically done. We were able to not only adapt, but thrive during that time and thrive in the business. Thrive in the sense that we were able to meet our customers where they are or where they were in a very honest and authentic way.
That's really great because everybody now knows what is possible, even when our hands are somewhat tied. How do you execute a great marketing campaign when you can't enter the studio and do a new shoot? Well, you go into the archive and you find assets that meet the objective and then you have a really great editor come and stitch it all together, and you do it all remotely. You put it out into the market and it works. That is a huge confidence booster to the team. Now when you have a budget and you can go to a studio, how much more potential is there? Or maybe you realize that, "Hey, you don't need to spend that kind of money to get a great result."
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