Launching a business has never been easier, but for brands new and old, growth is becoming increasingly more difficult and expensive by the month. On top of that, the competition continues to strengthen and multiply. As a result, it's becoming ever more critical for brands to find creative ways to distinguish themselves in a crowded marketplace. During our Underground Session in partnership with Lean Luxe, we took a closer look at all the most important milestones in the journey to scaling up a successful, robust brand. From apparel to alcohol, here’s what we learnt from the leaders of some of the best DTC brands in the US: the founders of Haus, MM.LaFleur, M.Gemi, Trade Coffee and LAUNCH.
Approach sales with careful consideration
Having helped several startups rise to fame, Jono Schaffler, Partner at LAUNCH, believes brands should consider their purpose before anything else. In a saturated market, it’s vital to ask yourself honestly if your brand will truly make an impact on people's lives: “Two things are often overlooked in modern brands: intuition and need,” he says. For Helena Hambrecht, co-founder of the grape spirit brand Haus, she has witnessed firsthand how creating an exciting product isn’t the end goal. It’s the sales strategy that drives the business, she explains: “It’s not enough to produce a great product; how you sell is just as important, if not more.” As for Sarah LaFleur, CEO of MM.LaFleur, focussing on where she’s selling was the clincher for her business: “Taking time to build market is critical. For example, we kept going back to Seattle for week-long trips until we felt the market was ready for us to open a store.”
Balance online with offline presence
As CEO of a hugely successful womenswear business, Sarah has taken many risks in getting her brand off the ground. One example was shipping out freebies to show customers the quality of the dresses – something that was difficult to convey online. “If you’re looking at a 2D screen, it’s really hard to tell why our black dresses cost $250 compared to those that sell for $45. We asked a bunch of customers if they’d like to receive a box of dresses to try, 80% said yes and we broke sales records that week. Seeing the dresses in person justified the pricetag,” she explained. As for more traditional ways of selling, she swears by the appointment based model: “Customers can work with our staff one-on-one. It’s an efficient 60 minutes to find out what works for them.” When it comes to pop-ups, she learnt one valuable lesson on how to choose locations from her early days: “In the beginning we did three-day pop-ups in hotels rather than negotiating random leases with, say, a gallery owner.”
Build a loyal community and keep them close
Paul Munford, Founder of Lean Luxe, posed the question: “If you’re thinking about how to get in front of your customer, are they only going to be looking online for you? Probably not.” Following this, our panelists gave examples of how they connect to offline communities: “We hosted VIP dinners where a congresswoman was sitting next to an astrophysicist who was sitting next to a 27 year-old law grad. Connecting working women is one of the best parts of my job,” said Sarah. By imagining the environments where her products could flourish, Helena said she noticed something: “It’s not just about the alcohol, it’s the environment - bars can be intimidating. There’s a real shift in where people are gathering - now it’s coworking spaces, hotel lobbies and galleries. We created products and environments to serve that cultural space.”
Nurture a tight-knit group of customers
Targeting customers is one challenge but keeping them interested is something else entirely. Jono explains why: “The modern customer is savvy at getting deals and moving on.” But there is a way to measure this frivalry, he says: “surveys can help gauge whether they’re likely to return.” Once you’ve found your fanbase, it’s vital to nurture their loyalty, says Jono: “Stay in close contact with a tight community of customers.” For Sarah, communication trumps the channel when it comes to targeting customers; it’s what you’re saying, not where or how you’re saying it. She asks: “Are you making something that people want? And are you able to convey value through something as succinct as an ad?”
Don’t forget investors are human too
It seems the investing climate is changing and Jono Schaffler has noticed a shift, meaning it’s ever more challenging to drum up funds: “VCs are less willing to throw money at something these days.” Interestingly, Helena found that recognising the individuals' differences and tweaking her approach to each pitch has played a huge part in her success: “I’ve learnt what resonates with what type of investor in the ecosystem, such as CPG investors versus Silicon Valley versus LA. Everyone is different.” Jono agrees, explaining that “There are investors who are, let’s say, less sophisticated. Some people just want to be involved with companies that are fun to talk about at dinner.” For the female speakers, two strong pieces of advice were given to the crowd: “Avoid the summer as everyone is away” said Helena, whilst Sarah urges businesswomen to stand by their integrity: “If they’re rude, walk out. Don’t tolerate it.” After exchanging investor tales, one skill proved helpful for everyone across the board: being a good judge of character. “At the end of the day, investors are people. When the chips are down, is this person going to have integrity and be a good partner as you navigate through challenges?” asked Jono. Again, concentrating on the individual, Helena also suggested: “If you want to work with them personally, ask if they’d be interested in writing a cheque themselves.”
Remember the element of surprise
For Sarah, it’s all about keeping the audience on their toes and taking risks: “Are you saying something different and surprising people?” she asked. As for the story behind her controversial ad campaign: “Our copy editor had a quick idea to write Our pants are so boring we’re not even going to show you. That 30 seconds of work went viral.” After this success, she makes sure her copy team follow very specific tone of voice guidelines: “It has to be practical, purposeful and charming. I tell them to enjoy the process and bring joy to it.” Offering a totally different tactic, Helena believes her strength lies in her authenticity: “Investors liked that we came up with the idea for a grape based spirit and we’re grape farmers. We literally make it.”
Question commitment when it comes to employees
Of course, building your team is a big step in upscaling, as Sarah puts it: “It all comes down to the people who are working on the ground.” What’s important to Helena is that the employees’ commitment match that of the senior staff to ensure a long-term fit: “When it comes to vendors, are they really stoked to work for you? Does it really resonate with them or do they see you as a paycheck?” The same applies to Sarah, who believes you should look for people you connect with: “You want to be able to have a five-hour conversation with each member of your team; the kind of group that read other’s minds and finish each other’s sentences.” Collective ambition forms the foundation of any business, Jono concludes: “We have a heart as a business and a direction that we all believe in. It makes us feel invigorated.”