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Here’s the program.
Andrew Warner: Hi, everyone. My name is Andrew Warner. I’m the founder of Mixergy.com, home of the ambitious upstart. How do you automate repeat business? Well, joining me is Ken Johnson, co-founder of Manpacks. Well, you know how guys hate to shop for underwear? Well, what Manpacks does is it offers a subscription based service that sends guys socks, t-shirts and underpants. Underpants is a funny name, underwear.
I invited Ken to find out how he built his business and how he’s getting so much frigging press. Ken, welcome to Mixergy.
Ken: Thanks for having me.
Andrew: I looked at that press page on your website just to get a feel for what other people have asked you and your background of the company. And what kept standing out for me is just press hit, press hit, “New York Times.” Who else was on that list? “Inc.” magazine was on that list. There’s just a long, long list. How long have you guys been in business that you’ve accumulated so many hits?
Ken: We’ve been in business about nine months now. We launched in January of this year. People ask that of us a lot. What do you guys do? What is your strategy for getting press? Precious little strategy. I mean, people picked up on it, and really we owe so much of that to just word of mouth.
You know, we launched, it was pretty much a soft launch. We didn’t have a big event for it. January 15th, 2010, we tweeted about it on Twitter, and we got retweeted by Chargify, our subscription billing company. We were one of their early customers, so they were sort of helping us along because as we grow they are going to grow. So, it just got picked up. It was sort of a wild concept to people, and before we knew it, three months later, we were getting all of these press hits in March. It just sort of snowballed from there. To this day we still haven’t written a press release.
Andrew: All right. In that case, there you have it, an idea that just happened to take off. That’s the end of the story. Good-bye everyone. I’m not going to allow that to happen. We have to dig deeper into it. We have to understand exactly why you got all that press, dissect the business, and figure out how you got here.
Andrew: To make it useful to my audience. So, why don’t we go back in time a little bit, before we even get to Manpacks and understand where you came from? You don’t have a PR background, and you weren’t an entrepreneur forever before. What were you doing just before this?
Ken: I come from a retail background. I was working in furniture in an operations position and studying customer experience every day, how they were interacting with our sales staff, their experience in the store, doing everything we could to enhance that experience. You know, there are a lot of similarities between what we were doing there in the brick and mortar and carrying that into the eCommerce realm.
Andrew: For example, like what?
Ken: Well, you know, one of the things in our business model for this particular store, it was a showroom. And if you saw something you liked, you went up to the desk, you ordered it, and then we would order it from the factory, who would ship it to us and we’d deliver it to the customer. So there was that same sort of delayed gratification of we had their money before they had their goods. And it’s all about building trust in the interval of time between when you take someone’s money and when you deliver on your promise to them. So it operated almost exactly like an online retail shop, which is the same issue that we have, trying to reinforce that trust and assure people through the process.
Andrew: How do you do that online? I want to try your service out, and I still haven’t. But do you have the kind of underwear I wear? Boxer briefs. Do you have the kind of socks that I wear? I don’t really care what kind of socks I wear. I don’t know about t-shirts. But the underwear, at least, it’s very important to me to get it without having to go out of my way to get it. Every time I think of trying your service out, I keep thinking, well, who knows if it’s going to work out? There’s no urgency right now.
Andrew: And who knows how long it will take for it to come? Forget it. Whenever I’m down the street, I’ll go to Banana Republic and I’ll pick some up. How do you answer that issue with customers like me?
Ken: Sure. I guess that’s not really so much a trust issue though as it is almost a social proof.
Andrew: The delayed gratification is what gets me, and that’s what often stops me from buying online.
Ken: True, yeah. Once we have people trying our service, we have really good retention with them, and they stick around because they enjoy this service. But the fact that there isn’t that sort of urgency to get involved with something like that is a little bit of a hurdle for us. And that’s where we’ve been looking to tap in more to leverage the social aspect.
We have a lot of really great customers, really great high profile customers. But since we’re a B to C business, I don’t think that we’re allowed the same sort of liberties that B to B businesses have with sharing who their customer base is. It’s more private in the B to C.
Andrew: I get that. You’re saying it would be nice to be able to say that . . . I don’t know who would be on there.
Ken: Here’s one, Leo Laporte. Leo Laporte, we can say that he’s a customer because he actually bought his Manpacks subscription live on his show.
Andrew: But you can’t say all the other people who are buying your stuff. You can’t boast of their names on your website. I get that. But what about the delayed gratification issue that you said you noticed when you were working in retail and that you learned from it and brought it online? Have you been able to come up with a solution for it yet?
Ken: Well, really what it is it’s about being proactively in contact with your customers. If you wait until they contact you, you’ve already lost. Good service is there just as they think they need it. I draw the metaphor a lot to getting really good service in a restaurant where the best service is when you’re just running out of your drink, and then you look and they’ve already replaced it. They’re there just when you need them to be, but they’re gone when you don’t need them to be.
And so, I think that just as you know where along your process there are spots where someone is likely to have a question or likely to be experiencing a concern or a doubt. And in those likely times you need to insert yourself and contact them, reach out to them, and let them know what’s going on. If their shipment is going to take a little bit longer than you had set the expectation to be, you’ve got to be right there right away.
Andrew: Let me stop you for just a moment here. Ken, you and I talked in a pre-interview before we started here. We got a little bit of rapport there. I feel like you know and you trust me. So, let me put this idea out there. When you were working retail, bulls***. It was not really that much that you learned that you were bringing in to what you’re doing here. It’s a good background story that really didn’t have much of a connection to what you’re doing here.
My sense is from the conversation we had before, and this is nothing but a sense. You didn’t put any facts out there that would lead me to conclude this, but I’ve got to ask about it. You were probably sitting in that store saying to yourself, “What the f*** am I doing in this store? I’m selling frigging furniture while I’m reading of all these guys with minimal viable products online and they’re building incredible businesses and all they did was put together a few pixels. I got to get in on that.”
And then, what you and I talked about in the pre-interview would make sense which is you tested out a few ideas, bing, bam, boom, this idea happened to hit. Let’s put all our energy behind it. Is that right? Is there like a little bit of truth in that?
Ken: Oh, yeah, absolutely, absolutely.
Andrew: So then, what are some of those ideas? You were starting to tell me about them before we started this interview, and I said, no, hold on. Let’s keep that fresh for the interview itself. You were running a few different, minimally viable ideas. What did you put out there?
Ken: Well, we were actually building a service. It was called Hot Bottle. And see I come from a music background. I played in bands all through my 20s, and so did my co-founder, Andrew. I was always in the sort of band manager role, booking the shows and eventually going to booking agents to book our shows for us and realizing how badly the shows went when someone else was doing it, wanting to keep control of booking in my own hands but not having the contacts to book the shows.
Ken: So we were building a service to connect bands with venues, and it was really an awesome service. And we were getting people signing up for it and getting good feedback, but the path to revenue was virtually non-existent. We were essentially creating a social network, and we didn’t really know a lot about the fundraising process.
We decided we needed to start coming up with an array of minimally viable products. We had been reading all about lean startup, and we just said, “Hey, you know, we can really throw an idea out there into the world for so cheap and see what starts to catch on with people.”
So, we set up our business as Made By LLC at the time. Now, we’re Made By Co., and it was going to be the umbrella for all these little business ideas that we had. Me coming from a retail background and Andrew coming from a web development background and the whole software as a service, that being so familiar to him, we decided to try to package up products like software as a service.
We decided to start with something super basic and super essential. How about underwear? We figured, well, guys really hate to shop for this kind of stuff. Like, wouldn’t it be nice if fresh socks just arrived in the mail and you could just forget about it. So, we packaged it up. We put it out there, and the rest is just sort of history. We found the Manpacks.com domain name very quickly, and we went, well, we’ve got to do something with this.
Andrew: Manpacks is a great name for it.
Ken: It worked out.
Andrew: And it allows you to add more things. You’re not limited to just underwear. You’re not limited to just socks. You can go and expand beyond it and keep delivering stuff to us. Was this the first of many products that you were hoping to come out with under the Made By LLC brand?
Ken: Yeah. This was the first one.
Andrew: And this one did so well that you said it has legs, we’ll keep going with this.
Ken: Yeah. Well, for the first three months it was slow. We launched, and we’d get a sale the first day. Then we got two sales, and then we got one sale. But it was sort of limping along. We knew that there was a pulse, and then March hit and we got all the press and I couldn’t fill orders fast enough. We started with $1,000 investment and some underwear, shirts and socks that gathered dust for a while. But then suddenly, we were blowing out of the stuff.
That’s when we had some scaling issues. We had to outsource our fulfillment and everything. But all along, those first three months, I was still working on Hot Bottle on the side. We still were treating this like the side project, and it eclipsed the main project. And it became my full-time gig in March, and then Andrew came on a month or two later.
Andrew: What did that first version of the site look like?
Ken: Of Manpacks?
No one knew how to use it. It was only when we started packaging things up, and we decided that we were just going to an every three months schedule as opposed to having people choose what kind of schedule they wanted. By limiting a lot of the options, we were able to simplify it so that it became a concept people were familiar with and kind of went through a process they knew.
Andrew: What kind of options did you take out? You took out the interval. Now, you guys will mail out . . . is it monthly or every three months, you said?
Ken: It’s every three months. And that’s a whole other story.
Andrew: What other options did you kill?
Ken: Yeah. We took out the setting of the frequency. We had it so basically everything was a la carte. You sort of customized every order. And when I keep saying we put it together like software as a service, we did the whole like, “Here’s your single pack which has one of each item. Here’s your Manpack which has two of each item.”
We just tried to make it super simple, like we’ve already picked the quantities for you. We already set the frequency. Just click the button, you pick your styles, and you can be on with your life. Now, that has become like the starting point for a bigger service, and we realize how important the service is here, but that’s what we’re selling, not the socks and the underwear.
And so flexibility is the big deal. You have to be able to have as much or as little control over this process. It’s not just a subscription that’s going to relentlessly send you underwear that you don’t need. You can not get anything at all one cycle and then get lots more the next.
Andrew: I see. What else? What else do I want to find out about it? Oh, right, subscription. Why did you want to do this as a subscription instead of just letting guys go online and order underwear as they want it and as many as they want? Why subscription?
Ken: You know, we were very enamored with the whole four-hour workweek concept at the time. We had both just read the book, and we were thinking automation, outsourcing. It makes a lot of sense to get rid of some mundane responsibilities. So, that was the original thinking behind it. We call it a subscription because it’s an easy way to communicate the idea to people, but it doesn’t really operate entirely like one. I’d say about less than half of our customers set up their service and just let it continue like a subscription. They get the same thing delivered to them every three months and no complaints. But the majority come in, they log into the dashboard and they’re constantly updating the things that they need and changing things around.
Andrew: I see. So, most people will just buy one at a time as they want to. Subscriptions though are still very popular.
Andrew: Was part of your idea for building a subscription to just lock in your revenue, to do what I said in the introduction, to create an automated repeat business?
Ken: Yeah, yeah. Originally, that was the thinking behind it. And, you know, I would say that is one of the lessons learned is that I don’t think that is really what people want. But they want as little or as much involvement in that process as suits them. We’ve sort of blown it up to be more of a loyalty program. As long as you’re getting a good experience from us, there’s no reason to really go away. We haven’t made you upset. We’ve done our job for you. People keep coming back because they like us. So, that’s really where our focus is. It’s not breaking that relationship with people.
Andrew: Okay. First version, you said it was all these different options. How long did it take you to build that first version?
Ken: First version, well, because it was still very much on the side, it took us much longer than it would have otherwise. I don’t come from any sort of technical background either, so I wasn’t much help. I wasn’t any help to Andrew in the actual coding of the site. I was actually his sounding board. He would come up with an idea, show it to me, and I would give him the feedback. It took us probably three months, I’d say, to build that first version, very much at night, after hours sort of stuff. It didn’t do much of anything. We launched it in October of ’09, and nothing happened. And we repackaged over the holidays and relaunched on January 15th this year.
Andrew: Okay. And in that nothing happens period, did you try to buy advertising? Did you try to reach out to bloggers? Did you do anything like that to bring in people?
Ken: We were on a very minimal AdWords budget. I think we were doing, like, it was probably like $3 a day, $5 a day, something like that, just to try to get some people to the site, to be able to observe what was going on. And other than that, we tried to make our presence known on Facebook. But I just think that we weren’t good enough yet at communicating our message on the site. That’s really what it was. It wasn’t compelling enough. It didn’t have enough of a sort of ridiculous flair to it.
And back to your earlier question of how did we get so much press, I think that that’s the sort of purple cow element of being both loved and hated. People have a very emotional reaction to what we’re doing. Some people rail against it. Oh, this is a sign of how pathetic and lazy American men are. Other people say, oh, this is wonderful. This is just what I need.
One of my favorite tweets, if not my favorite tweet is, “Just signed up for Manpacks. I can’t tell if this is one step towards or one step away from responsibility.”
Andrew: I see.
Ken: You don’t know. Is this me getting more responsible because I’m taking ownership over this thing that I used to just wait for other people to do for me, or am I avoiding responsibility by outsourcing this? That’s the question that everyone asks.
Andrew: You know what I’m wondering? I can see that. It does feel shocking at first. What? Underwear on a subscription basis? And at the same time, it does feel like, wow, finally somebody is going to solve this problem for me. I’m buying the exact same pair, have been for years. I just don’t always get around to it. This is too much information in this program. Screw it. I don’t even think we’ve gotten too much information.
Why didn’t you stop then? You launched the first version. You bought AdWords. People weren’t reacting. This was a test. Why not say, “Let’s go try something else, Andrew. We became partners, but we didn’t become married to this business. Why this?”
Ken: That is such a good question. I’ve never really thought about it until now. I would have to give a lot of credit to Andrew on this because it was one of those things. He probably woke up a little early one day, and it was bothering him because he didn’t like the user interface. And he just woke up and had this idea to package everything together, and he had this vision of oh, I know what we can do to simplify things. Simplify in a sense [inaudible 21:13]. Is there anything we can eliminate here? And he did it. He repackaged it and redesigned it. That is why it was able to gain early traction.
Andrew: How long did version two take, the one that made everything really simple?
Ken: Very fast.
Andrew: Are we talking about a month?
Ken: I would say a month, yeah.
Andrew: A month, okay. And it was brand new. All the other layout disappeared. It was just this new system.
Ken: We threw out pretty much everything except, maybe, our logo. We redesigned everything, and the other thing is we got off of PayPal and we set ourselves up with our own payment system. You know, I think that did have an impact on putting through those conversions as well.
Andrew: Really? So, more people were willing to sign up because you let them pay using the standard payment form than when you sent them over to PayPal.
Andrew: I wonder what it is about PayPal that drops off orders. I would think that more people would order from PayPal and trust it.
Ken: Yeah. I’m not 100 percent sure on that. I don’t think that PayPal was the best solution for recurring payments. It seemed awkward to us. It was that awkward point of confusion that I think it was enough to sort of limit our potential there. Everything got so much easier for us when we integrated our own billing solution and got involved in the very early beta with Chargify. They’ve really grown with us and been very receptive to our feedback, to tailor a service for us.
Andrew: What does Chargify allow you guys to do?
Ken: They allow us to just bill people on a recurring basis. If someone’s credit card has expired, they’ll let us know and they’ll notify the customer that they need to come back and give us a current card. They just take care of all of that.
They also uphold very strict PCI compliance. So, we don’t have to handle sensitive information on our own servers. It’s all very secure with them, and they’re specialists at that kind of thing. It’s good peace of mind there as well to know that our customer’s data is being handled well.
Andrew: All right. So, now you’ve got a brand new version of the site. This one took you a month to do. You put it out there. What’s the reaction?
Ken: The reaction was, you know, either this is insane or this is genius. Some people were saying that this is the best idea they’ve ever heard, and other people were really bashing it. Some feminists took issue with it, too.
Andrew: Feminists took issue with this?
Ken: Sure. Yeah. I mean, one of the best threads on a forum that I’ve seen was a society site, anthropologists. And they were reading into the cultural implications of a service like Manpacks. You can find it out there. I think it’s SavageMinds.com.
Ken: It’s a really interesting discussion. They’re looking into it way too deeply in my opinion, but it’s also there’s some really good conversation going on there about what this means about gender roles and all that. They got into it.
Andrew: You know what? This obsession, I just don’t get it. I’m sure there’s somebody out there who’s saying about me, “Why does he have to know what program they’re using to charge? Why does he have to dissect where the money, where the business is, where the customers are for something like Manpacks?”
But I’ve got to do the same thing about them. Who cares? The anthropological this or that of underwear. Why don’t you find out what’s working here and maybe copy it, maybe create a pantyhose subscription for women or something?
Andrew: That’s the way I see the world, but I’m sure they’d laugh at the way I see the world, too.
Ken: Someone on that forum called us, they called us sinister and enfeebling.
Ken: A very interesting choice of words there, sinister and enfeebling.
Andrew: Now, what I’m wondering is how did all these people who are criticizing or complimenting you even find out about you? They didn’t find out about your version one. What was it about the version two launch that made them all say, “Ah, I’ve got an opinion over here. This is now an indication of something bigger.”
Ken: Because they heard other people talking about it.
Andrew: Why did other people start talking about that, about version two?
Ken: I don’t know. I think it might just be a function of momentum, like one person says something and then another person responds. And then, a conversation starts, and you need enough people to fill a room to have a party. I think we were just able to get to that and that little spark happened.
Andrew: It’s like a firefighter. Most people walk into buildings, and they say a fire happened here. The fire started somewhere in this building. Too bad. I’ve got to be a firefighter who wants to find out where that match was to know why the building lit on fire because that’s what I’m here to learn. So, what do you think that little spark was? What match set this off?
Ken: Well, okay. We were hyper-focused on marketing ourselves to a very niche group of tech savvy guys.
Ken: And so we built something that would immediately resonate with them because it was a process that was so familiar, the software as a service. You know, we’ve been big fans of 37signals. There were elements of our site that almost look like we’re packaged for base camp or something. When people saw that and mentally made that connection, they went, oh my God, this is built just for me. It’s weird.
If you want to start a fire, you’ve got to focus the energy in one spot long enough for that ignition to happen. Maybe that’s what it was. It was hyper-focused. We weren’t trying to be all things for all people.
Andrew: I can see that. It looks like the landing page. It looks like the home page. It looks like you guys are selling software as a service. You do have the button in exactly the same place as all the Y Combinator startups have their button. You have the same size text on your page, the same image on the right side and so on. I get that.
Andrew: But how did those people even find out about you, the little group of people who know what 37signals is and will remember that we said 37, not 36 or 38 because they’ve heard 37signals for years now. How did they find out about Manpacks? How did you reach out to them?
Ken: It started as a post on a website called Springwise.
Ken: Springwise, I think, is based in Europe somewhere. Shoot, I can’t remember specifically where. But they basically scout out new entrepreneurial endeavors and write about them. They wrote about Manpacks. So a lot of other entrepreneurs were checking us out to see, hey, is this a viable business model? What’s going on? A few days later, it was Hacker News.
Andrew: Interesting. Somebody saw it on Springwise.
Andrew: Then, they linked over to it on Hacker News, to the home page on Hacker News. It got voted up and that audience started to come in and that then triggered the feedback and everything else that went on.
Ken: Yeah. I think the guy’s name was Zade, Zaid probably. And he posted about us on Hacker News, and it got us tons of hits on the site. I actually sent him a thank you email about a couple months ago, because we attribute a lot of what happened to this one guy just happening to post about us on Hacker News.
Andrew: Okay. I hear that. You know what? I do that, too. Any time you get traffic from one guy who happens to submit your stuff, I think it’s worth sending a thank you note.
Ken: Yeah. Well, he may have knowingly or unknowingly influenced the rest of your life.
Ken: Everything that’s happened can really be pinpointed possibly back to that one guy just having the presence of mind to post about this business that was nothing at the time. And I really do, genuinely thank him because this has been, hands down, the best experience of my life.
Andrew: When you get the first Hacker News hit, people are voting you up. They’re coming to your site. Some of them are buying. Actually, are they buying?
Andrew: Okay. So, some of them are buying from you, and you realize, ah, this is a fountain of audience and customers. Do you think, how do I go back to that fountain and get more? Do you think, how do we get more stories posted on there? Did you try anything else?
Ken: We haven’t done too, too much of it. Since that day, and to answer the biggest value of that stream of traffic from Hacker News that day, we did make a few sales, but it was more of that now we can start collecting data on what’s going on, on our website. And that sort of began the whole analysis and improvement and brought us to where we are now.
Ever since that happened, we’ve been sort of pulled along, trying to catch up with this thing that was running away from us. The momentum was pretty great, and just now we brought in our first hire last week. So, it’s been Andrew and I the whole time. So, we haven’t had a lot of resources to really look beyond just trying to improve our messaging, strategize the business development, and improve our customer experience. That’s been our focus. The whole outreach part of the puzzle has been neglected a little more than it probably should be.
Andrew: How about that “Inc.” article? There was an article in “Inc.” which announced Manpacks, and then it asked other entrepreneurs to give feedback and suggestions for Manpacks. How did you guys get that article written about you?
Ken: The editor reached out to us in March. He said they would be interested in doing an article on Manpacks. Would you be interested in an interview? I said, of course.
Andrew: Okay. Was this after the Hacker News hit?
Ken: Yes. It was maybe a week and a half after.
Andrew: That’s so interesting. By the way, I found that other reporters will look at Hacker News and come up with stories. And then those stories end up just kind of growing and growing and feeding on each other. Did you ever reach out to any of these guys? What about to Maxim to NBC to “The New York Times?”
Andrew: Thrillist, did they get an email from you first, Huffington Post, NPR, ESPN Radio, any of them?
Andrew: No. It all just happened because they saw this thing, it was a purple cow, and they wanted to talk about it.
Ken: We always try to investigate and try to put forth our best assumptions on what’s going on behind the scenes. Who’s communicating to who? What are they saying about us? How does that information travel? It’s mostly a mystery. I don’t really know.
Andrew: Wow. All right. So, this is stumping me because now I don’ know how to follow up on this. If it just happens, then it just happens. No, we’ve got to go back to where that initially happened.
What do you think makes this a purple cow? What is it about the way you’re selling underwear? Now, this has been done before. We can name a few websites that already have done this. In fact, you’re mentioned with those other websites in some of these articles. Why Manpacks? What is it about Manpacks that suddenly got them to say, “Ah, this is interesting and it’s new,” even though it really isn’t that new?
Ken: Sure. You know, I think it might be our focus on the brand and service rather than just the product. If you do a search for sock subscriptions online, you’ll find plenty of results. To me, it seems like a lot of them are trying to move product. Actually, to relate this back to the “Inc.” article, one of the pieces of advice was that we should feature our product more, put it to the forefront more.
And so, we went, yeah, that’s a great idea. Why aren’t we doing that? And so, we put a bunch of product images on our home page, and it killed our conversions. It wasn’t good for us. We scratched our heads, and we took the images back down off the home page. And then, on further reflection we realized, of course, our product actually is the service. That’s what we’re selling. But that sort of ties in.
Our focus is more on the brand and making sure that the experience when people interact when they arrive at our home page is one that’s fun and sort of like dynamic, not boring and square and product imagey. I think if we were that, we wouldn’t be creating that reaction in people. But because we’re clearly having a good time, there’s something bold about that. If you’re able to have fun with what you do, people go, oh, you know, I don’t know. It just creates that impact where people can now react to it one way or the other.
Andrew: All right. That makes sense. It made sense, too, the feedback that you got on “Inc.” They said, “Hey, if you’re selling Calvin Klein underwear, let’s see the frigging Calvin Klein underwear on the home page.”
Ken: That’s right.
Andrew: If you’re selling socks, let’s see what the socks look like. When you were selling the product itself, results went down, conversions decreased. When you were selling the message and I see that right here on the website in big, much bigger than a little tiny image of underwear. When you were selling the message of men hate to shop, so we don’t make them shop, when you say you’ve got better things to do, I see that message all over the place, when you’re selling that message, then guys say, “Yes, that’s what I want to buy. That’s what I’m plunking down my cash for.” And that’s interesting.”
Did you have the logos before on your website, the Calvin Klein logo, even small, the way you do now?
Ken: At the time of the “Inc.” article?
Ken: No. That interview was done in March, actually.
Andrew: All right.
Ken: It came out in October. So, there was quite a lag in between. A lot happened in between. But, no, we didn’t have those logos, and that’s been important because it’s not important that we have the photos up. But I think people having a peak at what’s to come is very important.
You know, we don’t make people register before they can view product either there. If you click through, you select what package type you want, and then you’re on the styles page and you can see whatever we have to offer, too.
Andrew: All right. I see. Okay. So, featuring the product doesn’t help, but putting the logo on the bottom is almost like having a Better Business Bureau logo on your site that says, “We’re credible. Calvin Klein gives us some credibility.” I’m sorry. Go ahead.
Ken: I would say without that on there people might think that we’re selling our own label.
Andrew: I would have thought that, too, actually. That’s the first thing I thought when I saw the picture, and then somehow my eye, without noticing, drifted down to the brands. And I said, “Ah, I recognize Calvin Klein. I know that that’s dependable.”
Okay. What about the conversion rates or the customers that you got from all these sites, from NBC, Maxim, Thrillist? Which site gave you the most customers?
Ken: Well, it’s interesting. It’s Reddit by a landslide.
Ken: Yeah. It’s interesting, because the Reddit crowd is, on the whole, younger than our demographic. But they just send us so much traffic. We had one day fairly recently, we had 40,000 visitors in a 24-hour period, which for us was like . . . it was Andrew and I. We have a live chat on our website. Andrew and I were on there until 4:00 in the morning. I think, in the time we were on there, it was a span of about four hours. It happened about midnight and lasted until 4:00 a.m. We chatted with about 200 different people. I was chatting with eight people at once at one point. We were maintaining an average of about 400 people on the site at any one time. It was just mayhem.
So, the conversion rate for the Reddit crowd is very low, very low. A lot of curiosity, a lot of people coming in just to crack jokes and stuff. And if they want to joke around, we’ll entertain them, you know. But there’s enough people that even at a very low conversion rate, you can get a lot of subscribers.
Andrew: Okay. What were you guys doing? What were you talking about? I keep wanting to move on to my next set of questions, but I’ve got questions on this still. What were you guys talking about for so long on live video online? What is there to talk about?
Ken: On live video?
Andrew: Yeah. You were saying that you did a live video, and people from Reddit came over to watch the two of you. You and Andrew were just doing what? Talking about what for so long?
Ken: Oh, no. I’m sorry. It wasn’t a live video. It was live chat. It’s called Zopim. Other people are using SnapABug or something, but it’s just a little feature where if anyone comes onto our website, they can chat with us. For a while, it was always Andrew and myself. The two co-founders were there, ready to chat with anyone who came by.
It always appealed to me. I always wanted to be on there because it’s what made our store feel, to me, more like a real store. Whenever a visitor enters the site, a little ding goes off on my computer, and it’s like the door chime going off, someone’s now with you. And you’re available to help them if they need help.
To me, that’s so important. If someone’s confused, it’s really what’s driven a lot of development on our site. It’s this live chat collecting all that feedback real time from people who are confused on the website. And we can fix things.
Andrew: I see. So, Reddit was just sending traffic over to your website because this was a new interesting, novel business. And while those people came on the site, the two of you were chatting with them to see what people had to say. Gotcha. Now, I see.
Andrew: All right. What did you learn from the chat? What kind of improvements did you guys make to the site because of the chat?
Ken: There are very common questions on the chat, like for a while, it was is this real? People would get there, and they’d go, “Wait, is this a joke or are you serious?” They start off kind of incredulous. But then through the course of the conversation, a lot of times you end up turning them around. They go, “Wait, actually this is pretty smart.”
So, we try to reinforce the idea that, yes, it is real while still keeping a sense of humor about it. We have trust certificates throughout the website and in the brands now in the home page, that’s big.
People have questions, like, “Wait, isn’t every three months too often?” Because they have this idea that we’re trying to replace, maybe, all of their goods every three months when it’s really just a replenishment service. You get a couple of each or however many you want every three months.
So, it’s just sort of common misunderstandings about the service that we’ve been able to address. I think our headline copy on there right now underneath the “Men hate to shop” is “Start it, stop it, change it any time subscription.” So, we came up with that to sort of reinforce that flexibility. Really, it’s on you what kind of service you want.
Andrew: You know what? That’s so interesting. That’s another thing that my eye went to for reassurance, and now I understand how that happened, how you recognized that that’s what customers were worried about and how you came up with the solution to that concern.
How about one other one? What else did you learn from the chat that influenced the way that you present the information online or the way that you sell online?
Ken: Well, I think a big one is sort of a higher level concept. It’s how people want to keep their sense of humor on the chat. Even the people who are there to buy like to have a good time while they do it, and there’s so much humor involved. And so, we never want to lose that. We always have that sense that if we’re not having a good time building something, then it’s probably a bad idea for our customer because we’re not going to be able to communicate that it’s sort of fun.
Moving forward, I think that that’s going to be really valuable to us, just keeping that sense of fun in the site with everything we do.
Andrew: Okay. The logos of all the shows and magazines that you’ve been on or websites that you’ve been on, how does that impact conversions?
Ken: You know, we haven’t really done any specific split tests with and without just because . . . if we can take something that’s tested already and is sort of common knowledge, like a standard practice of putting those kind of logos up, we’ll just do it without testing it, just for the sake of being able to move more quickly.
Ken: We try to test, and we’ve only recently gotten into split testing, by the way. We iterate very quickly and maybe foolishly. Through our early stages, if we had an idea to change something, we would just change it. And we probably made more mistakes along the way than we needed to because of that, because we weren’t testing everything. We were always watching the data, but there’s a difference between watching your data and doing AB testing. So, yeah, we sort of considered the logos to be standard practice enough to put them up there.
Andrew: I see. By watching the data, you mean, you make a change, you see that more orders came in today. You’d say, “All right. That was probably a good change.”
Andrew: But you don’t know if it’s because you got more people on the website today, or is it because you got an audience from a different place today that increased conversions and so on.
Ken: Yes. We’d always be looking at trends, you know, how are we trending. And we would try to look beneath the surface to where, okay, our conversion rate’s up because we didn’t get 40,000 unqualified visitors today. We would look a little beneath the surface. But when you really get heavily into optimization, you’re dealing with fairly slim margins a lot of the time.
Unless you have enough conversions to get a meaningful result, it’s not really worth your time, and it’s hard to read slim margins without hard data, if not impossible. So, there are always higher margin things you can be doing, like improve your headline copy. That’ll have a big impact. The color of your buttons, probably a smaller impact.
Andrew: Gotcha. Where did you get the original pairs of underwear?
Ken: From Hanes.
Andrew: You just called up the company, and you said, “We need some underwear. We’ll buy a bunch. Ship it.”
Ken: Pretty much. I looked around online a bunch, and I was trying to figure out where we were going to get that original purchase, just to have in case someone bought from us. Now, I would have done it just by putting it up there and if someone bought, I would have purchased it on Amazon and sent it to them.
But I found Hanes brands had a really good wholesaler program with no minimum purchase necessary. They didn’t have thresholds. You didn’t have to order $5,000 worth of goods from them. You could basically get an account set up, log in to their back end, and order whatever you want at really good prices. Because of that, we were able to just put a small quantity order on, and that’s what we did.
Andrew: All right. I think that’s all the questions that I’ve got. Any advice for anyone else who wants to sell? Actually, let’s ask this. You and I agreed before the interview even though you told me your revenues that we wouldn’t be talking about them publicly. What about the number of subscribers? Can you reveal that?
Ken: Sure. Yeah. We’re at about 750 subscribers right now into our ninth month of business with a goal to get above the 1,000 mark by the end of the year.
Andrew: 750 to build to 1,000, yeah, and you’ve got Christmas coming up. That’s very doable.
Andrew: And that’s anywhere from one pair of underwear or one pair of socks in a subscription to how much? What’s the biggest subscription that somebody’s got?
Ken: It’s funny you mentioned that. About a week ago, we had our biggest sale come in. If you do the create a pack option, you can select up to 10 of any one item. Someone came in and ordered 10 of each item. So, it was like a $280 underwear sale for us on the first go. We still don’t know if he’s going to want 10 more of everything next.
Andrew: But he signed up for a subscription, not a one-time shot?
Ken: Yeah. It’s only subscriptions. You can opt out of service.
Andrew: I see. So, immediately when somebody buys, they’re in a subscription. They can always cancel at any time, but they’re on a subscription.
Ken: This is an important part of the puzzle. It’s that you have to check in with your customers to make sure that their needs three months down the line are going to be what they need then. What they need now is not always what they’re going to need then. So, we’ll check in with that guy a week before his next order is due, and we’ll say, “Hey, do you still want 10 of each?” And he’ll have the opportunity to change it.”
Andrew: OK. I know you also have a phone number from Grasshopper. They’re my sponsor, so we might as well talk about that, too. What’s the deal with the phone number? Why do you bother giving a phone number when you have the chat box up here and email? And getting calls is a pain in the butt. Who wants that?
Ken: Yeah. Well, it’s a great opportunity to interact live with your customers. It’s always a more meaningful conversation, and it’s great for building trust. If you’re in eCommerce, you have to have the phone number visible. I know there have been studies that even if people aren’t using it, even if they’re not calling that number, it has an impact on conversions.
Andrew: That’s what I hear all the time, also, that just having that phone number up there reassures people. And then, when they do call they’re actually giving you useful information. Like what? Because you told me about a lot of useful information that you’re getting from that little chat screen. What about calls? What else do you need?
Ken: Phone calls are funny. Usually, phone calls are for when there’s a more urgent need. Someone’s having a billing issue, or we messed up someone’s order. And they got too much or too little of something, and they call us up. They’re a little freaked out because they don’t know what to do. We say, “No problem. We’re going to take care of it.” We don’t really solicit too much information on the phone. We try to just resolve whatever issue that is and get them on their way.
Andrew: Gotcha. All right. So, I’ll close up with that. Any advice for anyone else who read Tim Ferriss’ book or heard your story and says, “I want to build something like that. I got to build a business on the side. What do we do?”
Ken: I’d say sell the service. Focus on your service and delight your customers.
Andrew: Not on the product, focus on the service. All right. That’s a great place to leave it. The website is Manpacks, Manpacks.com Thanks, Ken. Good meeting you.
Ken: Thanks a lot, Andrew.
Andrew: Cool. Thank you all for watching. And thank you, too . . . what is the guy’s name? Zaid, he’s the guy who put you on Hacker News.
Ken: Yeah, thank you, Zaid.
Andrew: Zaid, thank you. Bye everyone.
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