TheMikeODonnell

It’s September 3^rd and I’m writing this while flying to Vegas to meet up with my friends for our fantasy football draft. I haven’t been in Philly for a weekend since before July 24^th. During that time, I’ve traveled to Ireland, France, Lithuania, Latvia, Estonia, Sweden, Connecticut, and now Las Vegas. From July 24^th to August 24^th I didn’t work more than 8 hours a week. During that time, all I really did was check emails and delegate to my team. They performed wonderfully in my absence and took the initiative to make sure they got their work done. We even launched our latest product line, the smoker box, while I was away and succeeded in topping the hottest new sellers list in our category.

When I reflect on this past month and my life in general, I can’t help but feel incredibly grateful. I’ve earned it through my hard work of course, but there’s something to be said for the practice of gratefulness. On my 3 hour drive home from Connecticut I had the windows down and I sang at the top of my lungs and just smiled and was grateful for the good in my life. I’m aware that I’m on an upswing right now. I’m recharged from my travels and there are a million things I want to implement in my business. Life is good. The more I can internalize the practice of mindfulness the better off I will be on the next inevitable down swing.

I’ve Decided to Move Outside of The US

My last post was very introspective. I wrote it free form without editing so I could get it all out of my head and start to conceptualize and develop my ideas.  It’s been a few weeks now and I’ve had a lot of time to think about things from a less impulsive perspective.

During my travels I experienced freedom in a way I never have before. Since then, I’ve noticed that I have been more confident and I’m thinking and acting much more independently than I have in years. I’m living life on my terms instead of trying to please everybody. I don’t know how long I’ll be away for or how much I’ll decide to move around, but I do know that I need to continue exploring my freedom.

So Where To?

I’m not going to make that decision right now because I know I can’t move until January or February of next year. There is just too much at stake for 4^th quarter sales for me to be in a transition period right now. I will say however that I am strongly considering somewhere in Thailand or Panama City. I’ve never been to either of these places before, so I don’t know what it would be like to live there. When we get closer to December / January, I’ll make a list of pros and cons and start seriously researching each place to see if it fits into my goals. Cheaper cost of living is definitely preferred, but the most important reason for moving is really the personal growth side of things.

One of my goals is to become a sophisticated investor. Right now, I’m developing my business skills, but later in life I see myself as the type of person that buys, sells, and invests in a bunch of different businesses. To get to that point, there is a lot of investing and financial knowledge that I need to acquire. The way I see it is that if I can lower my living expenses by 1 or 2 grand per month, then I can freely invest that money without fear of losing it.

By moving to a place like Thailand or Panama, I can be aggressive and shorten the feedback loops required to learn through experience. I’ve also purchased both Security Analysis and The Intelligent Investor by Ben Graham so I can learn the theory side of value investing.

I’ve had a lot of conversations recently with entrepreneurs from all walks of life and I have to say I’m scared about what’s coming down the pipeline for the U.S. in the next handful of years. Right now, all of my wealth is held in my business. If something were to happen and people stopped buying commodities, I would have nothing to show monetarily for my hard work. I’m in a position where I should be heavily leveraged on growing my business, but at the same time, I need to make a concerted effort to take more money out and start diversifying into some other types of investments as well.

If I’m taking more money out, then I sure as hell better be laser focused on growing the pie as well. To do that, I need more personnel and I need more product lines. Part of moving to a cheaper place means having the ability to cost effectively open up an office and hire educated employees at a fraction of the price it would cost me in the United States.

We’re at a point financially in the company right now where we can afford on self-funding alone to be launching  1 to 2 new product lines every single month. There’s no doubt in my mind that by the end of next year we can have a full line of bbq and cooking products in our store. The only limitation to achieving this goal is bandwidth.

The 2 key hires I see right now to make this happen are a product development manager and a marketing launch manager. The product development manager will be tasked with researching new products, contacting manufacturers and cultivating relationships with them. They will need to build up a serious pipeline to ensure that we hit the 1 to 2 new products per month mark, but it’s completely doable.

By cranking up the product development engine, we also need to crank up the marketing engine to ensure each launch is successful. The marketing launch manager will be tasked with making sure all of the steps in our launch sequence are completed on schedule for each product.

These are 2 major hires, but they don’t need to cost me major dollars. Both positions are already fully built out and detailed. I just need educated people with attention to detail that can follow directions and execute the plan. If I can get both of these engines cranking, then we go from a 10 product company this year to a 30 product company next year.

Scaling to that size is not as simple as it sounds. From a management perspective, I need to start siloing other parts of the business out and hiring specialists. Before cranking those engines, I need to make sure I have the additional infrastructure and support available for that type of growth. My next hire right now is a dedicated social media manager / content producer. For this position, I’ve been looking into hiring a work from home mom in the United States. I’m looking at about $10-15 per hour for a 10-20 hour per month job to start.

After I fill that position, I’m looking to bring on an advertising campaign manager. I’ve already started systematizing and building the tools needed for this person to quickly analyze and update all of our campaigns.

The advertising analysis tools I’ve built are actually so impressive that I’ve decided to shop them on the market. Originally I was thinking I would create my own Amazon Advertising course and sell it, but I decided it would split my focus too much. I’m not an info marketer and I don’t have the infrastructure in place or the audience to easily launch a course like that. So I decided the best way to take it to market would be to reach out to someone who is already big in the space and partner with them. The first two people that came to mind were Ezra Firestone and Kevin Bombino.

I hung out with Kevin all week at Camp Maverick, so I decided to call him first. He actually lives in Vegas so I was hoping to meet up with him this weekend. Unfortunately, our flights are just going to miss each other on Sunday when he gets back from Burning Man and I return to Philly. Instead, we are just going to teleconference together next week.

Kevin owns Link Emperor, which is an SEO software I have been using for 2 years for my clients, Press Advantage, which is a press release distribution service, BrickFTP, which is an enterprise level file transfer system in which they spend over $100,000 per month just in advertising to compete against Cisco, and he owns Scientific Seller, which is a suite of Amazon seller tools. Very respected in the industry and has a huge list to promote to. He’s also like 30 years old and flies around in his own jet like a boss even though he admits owning your own plane never makes financial sense and is a complete cash suck.

So we’re going to meet next week and I’ll see if I can partition my tool off to him to add to the Scientific Seller brand. Regardless of if we move forward together or not, I value the fact that he has good morals and will be completely honest with me in terms of market viability and commission splits. I don’t know if I would feel the same way if I was entering into this conversation with Ezra.

Speaking of tools, I have been hard at work developing a bunch of new tools for various areas of the company. Let’s start off with the amazon advertising tool

Amazon Advertising Tool

This tool is really cool. With Amazon ads becoming so competitive, the only way to remain profitable is to bid on longer tail keywords. The primary keywords like “Grill Brush” are just too expensive because everyone and their mother is bidding up the prices. Longer tail keywords like “Weber brush for grill” on the other hand can be purchased for cheap and will result in an ROI. As you can imagine, the longer tail you go, the more variations are possible. So you get into a situation where you are someone like me with 9 or 10 ad campaigns running at a time, each with a couple hundred keywords in them.

Until very recently, this was incredibly difficult to manage and there were/are no tools out there to help you manage it. A few weeks ago, Amazon released a new feature that allows you to bulk download your campaign data into an excel spreadsheet. That’s where my tool comes in.

All you need to do is insert the bulk data into the raw data tab and then everything populates into a separate tab with a nicely formatted report. You pick the campaign you want to analyze from a drop down and it will tell you which keywords are hitting the desired metrics, which keywords need to be dialed in a little more, and which keywords we are losing money on without making sales. It’s all color coded so you can go down keyword by keyword and make quick modifications. The suggested increase or decrease is already provided for you based on a set of rules I created, but I can make judgement calls on the fly if I would like as well. Make all your edits right there in the spreadsheet and then copy over into a bulk upload file and voila, your entire campaign is updated to meet the specific metrics you are targeting for every single keyword. This tool save hours and hours of analysis every week and it removes the lazy factor of guessing what the bids should be because it auto calculates for you.

You can then insert the raw data from your automatic Amazon ad campaigns and it will analyze the data and find top performing keywords that aren’t being targeted in your manual campaigns. Just like before, it will automatically tell you what your suggested bid should be. All you need to do is bulk upload them into Amazon and your manual campaigns are up to date.

Finally, the spreadsheet also keeps track of all relevant metrics that you could never get access to through the Amazon interface. I now have an historical record of my macro and micro statistics on a weekly and aggregate basis. By creating a couple formulas, I’ve also been able to determine the exact cost per acquisition we are paying to acquire customers. This data is so invaluable from a management perspective. Before this spreadsheet, we were essentially flying blind. Now, we’re able to make tweaks on the fly to dial in every single campaign to our goals.

All we need to do to make this spreadsheet work is record a couple metrics once per week. Whenever we want to update the campaigns we just need to paste in the raw data. That’s it. Everything else auto calculates. Of course this task has been delegated to Caecilia already, so every Monday morning the spreadsheet is completely ready for me to make strategic decisions.

COGs Analyzer

The Cost of Goods Sold Analyzer was born out of necessity because of how many manufacturing batches we are doing across multiple different manufacturers. I always had most of this data, but it was never in an easily digestible form where I could make legitimate decisions off it.

Now, for each product I can see the historical rates for Manufacture Date, Re-order Time since last batch, Quantity, Manufacturing Costs, Import Costs, Total Cost of Goods Sold, and Per Unit Costs of Goods Sold. If I want to look at the Grill Brush, then boom, the last 5 shipments are all right there for me to compare. That’s my micro statistics.

On the product macro side I can also see overall how much money has been spent on Manufacturing and Shipping, as well as total average re order time, average order size, and average cost of goods sold.

Then, we take it to the next level and look at those same statistics based on manufacturer because some manufacturers do multiple products for us. By having all of this data at my fingertips, I can easily see how strong my relationship is with each manufacturer and track how often we are ordering from them. For our Grill Brush and Grill Set manufacturer, I can accurately say that we have spent over $55,000 with them, we place an order once every 5 months, and when we order from them, the final cost of goods sold is typically about 63% manufacturing and 39% shipping compared to our aggregate statistics of 69% manufacturing and 31% shipping.

I’m 2.5 years into this business right now. If at any point before this you asked me about that ratio, I would have very confidently told you that the majority of our costs comes in on shipping, not on costs of goods sold. That’s not because I was ignorant, it’s just because the data wasn’t available to me. I tend to think of products in terms of unit costs and shipping in terms of total costs. Now that I have hard data, I can tell that I was mistaken.

 

Freight Estimator

My freight estimator is another pretty cool tool. It’s not entirely accurate, but it gets close enough for me to make a good prediction. Every couple of months, my freight forwarder has to issue a General Rate Increase (GRI) based on what’s happening in the industry. I take those numbers from the GRI and plug them in to the tool and everything else is calculated.

All I need to do is pick my product from a drop down and set how many units I want to import. It then scans through a table on another sheet to figure out the dimensions of each carton, the weight, how many total cartons, units per carton, and cubic meters of the shipment. It then cross references this information with the pricing information to give me a breakdown of Ocean, Trucking, and total shipping costs.

New Blogger Review System (review embargo on launches)

My blogger outreach system is bad ass. I’ve discussed it on here before and I know how powerful it can be when utilized to its full potential. The problem is that we just haven’t been able to get it cranking at full speed. I have Marian working it 40 hours per week and we still can’t get up to 15 published reviews a week. So I decided to do an overhaul.

I started out by asking Marian a bunch of questions about what she thought of the system. It turned out there were just way too many steps that needed to be done and we were collecting so much extra information that we were never actually using. The system was just too complex to run the way I wanted it to run.

My job when I sat down to review the system was to simplify it, automate as much as possible, and break the management portion down into easily digestible chunks. This is the picture I came up with in my notebook:

At any point in time, a blogger would fall into 1 of 4 categories: Prospecting, Agreeing to Review, Follow Up, and Review Analysis. The original operating procedure for the whole process was one document that was about 20 or 30 pages long. With this new chunking format, we can have 1 shorter operating procedure for each categorization of the blogger. We also removed a bunch of unnecessary steps so the process could be simplified and executed repeatedly without missing steps.

Marian’s KPI of 3 per product per week also seemed to be very unfair because she couldn’t control who was posting which product reviews when. So instead of breaking it down by product, we just say now that we want 15 total reviews per week and we’ll decide which products to push in our weekly meeting.

When we got a blogger interested in our products, we don’t just send them the product. Instead, now we are making them agree to our terms. Our terms are there to basically ensure we get high quality reviews instead of junk. The reviews are still completely honest on the blogger side, but we ask them to agree that they will:

1. Make actual opinions instead of copying and pasting our product description
2. Include at least 1 custom picture. (We will then promote these on pinterest)
3. Include a link to Amazon and our Website (Amazon link gives us an affiliate commission unless they replace it with their own. Website link has tracking on it so we can see how many people the bloggers send to us)
4. Include an Amazon Coupon Code for 15% off (Incentivizes Amazon purchases from their audience)
5. Reasonable turnaround time of 30 days

If they don’t agree to these terms, they don’t get a product. Now of course they can agree to these terms and not follow them, but what we are doing is getting a commitment from them. From a psychology standpoint this is huge and we can then reference our agreement afterwards if they miss a step.

If a blogger doesn’t post their review in 30 days, then we have a 3 email follow up sequence that is sent to them over the next 3 weeks. When I looked at what Marian was doing, she was blasting a template follow up email every day to the bloggers who didn’t post within 30 days. Literally some bloggers received the same email from her 15 times. That’s harassment and is a quick way to get bloggers blasting you on the internet. Now, we use a more sophisticated approach of referencing the agreement and telling them that if they refuse to post a review they will be blacklisted in our system. Nothing aggressive, but all true and strategically written to elicit a response from them.

After the review is posted, Marian cross references to make sure they completed each of the steps we were looking for. If they didn’t, she kindly follows up with them to ask for modifications. When a blogger does a quality review, she enters their email into a special hidden page, which automatically sets up a follow up sequence for them to continue reviewing more products for us. This process will continue to offer them new products automatically as long as the reviews they are posting are high quality.

Now we are weeding out all the bad bloggers and building a list of the good bloggers. Each blogger is then tagged in the system so we know exactly what products they have reviewed and which ones they have not reviewed. Now instead of always prospecting, we can do targeted email blasts to get tons of reviews at once from the blogosphere.

In the world of PR, there is a strategy called an embargo. This is where you release a little bit of information on the story to a bunch of reporters, but tell them that they can’t post the whole story on the news outlet until a specified date. The purpose of this is to line up a whole bunch of press that all gets published at the same time and causes a media firestorm.

We can now apply the exact same principles to product reviews with bloggers. When I come out with my next product, I am going to stage a blogger review embargo for about 30-40 days after the initial inventory hits Amazon.

We’ll get our inventory in and start making some initial sales. Then we will do a blast email campaign out to our high quality bloggers seeing who is interested in reviewing this new product. Anybody who says yes then automatically gets sent to a page where we lay out the terms of the embargo (Aka. Review must be published on X date). We’ll then have these people in a specific email list so we can follow up with them and make sure the reviews are all posted on the right date.

Now we have a product that is about 30 to 40 days old on Amazon. It’s picked up a good amount of sales from our initial launch and it’s starting to move up the keyword rankings. All of the sudden in one day 50 blog posts flood the internet reviewing it and saying how amazing the product is. Each blog post has custom pictures and coupon codes which send hundreds or maybe even thousands of visitors to either Amazon or our website. Even if only a small percentage purchase, Amazon sees a flood of activity going on and will increase our rankings. We can then take all 50 blog urls and start approaching press websites to show credibility and then get them to buy in on it as well.

 

Slack Communications

Slack isn’t a tool I developed, but it is a software that I have recently integrated into the company and have been getting great results with. Basically it’s an internal company communications system. Instead of me having individual conversations with everyone on Skype, all of the team members are now able to have open communications with each other via Slack.

We have a general chatroom for company wide announcements, random chat room for non work related conversations, a marketing space where Iris and Marian can collaborate, and a bunch of other cool features. I’m really trying to build more of a company culture through Slack and use it for team building. Instead of everyone being on their own island, they are now part of a team.

Starting on Monday when I get back, I am going to be doing weekly 1 on 1 meetings with each team member. This way we can stay on track of the previous week’s accomplishments, solve any lingering issues, and get on the same page moving forward into the upcoming week. I’m going to start having them each share their big wins for the week in Slack as well. So Marian will share the newest blogger reviews links and Iris will share the newest Youtube video links and Caecilia can share customer testimonials. This will give everyone a much more holistic view of all the awesome stuff going on in the company and it will give me more opportunities to publicly praise them for doing a great job. When we get our social media manager on board, this will be the perfect medium for her to source as much content as she will ever need.

Locking in Caecilia

During the last 2 weeks of August, Caecilia failed a bunch of her KPIs and received a warning. She is my rock right now so it’s essential that she is performing at the top of her game every week. When I asked her about what happened, she told me she got caught up in family life and work with her other client.

I immediately started probing. I looked at her time sheets and saw that she’s been working about 30-35 hours per week for me. I wanted to know how many hours total she was working per week including other clients. She said she was working about 50-55 hours total and only had the one other client. When I asked about her ideal work life balance so she could still be a great mother, she said she was happy with around 50 hours per week of work.

We’re moving into a high growth period in the company so I knew I needed to lock her in to me full time. I asked her straight up how much her other client was paying her and she said $5 per hour. She’s been working for me for 3 years now, I completely trust her, she plays a vital role in the operations of the company and is pretty much irreplaceable to me right now…and I was only paying her $3.50 per hour. Shame on me for not appreciating the importance of her role in the first place. I couldn’t imagine what I would do if I lost her.

So I made a proposal that I would increase her salary to $5.15 per hour, which would come out to around $6 per hour each month she hit her KPIs Bonus. The only caveat was that she would need to put in her 2 week notice with the other client and work solely for me. She needed to discuss with her husband first before making any decisions. Within 2 days she got back to me and accepted the offer.

With the exception of the Freight Calculator, everything from Locking in Caecilia to Implementing Slack, COGs Analyzer, Amazon Ads Tool, Blogger System Overhaul, and Deciding to Move Outside The US has all happened within the last 9 working days.  From August 24^th when I got back from Camp Maverick until today, September 3^rd when I’m leaving for Vegas. I know I can’t keep this pace up, but it’s been one hell of a spurt of productivity since I’ve been back.

 

Current Masterminds

Masterminding is one of the absolute most important activities I do on a weekly basis. They keep me hyper focused, accountable, and provide a constant stream of new actionable ideas. Right now I’m a part of 3 different masterminds.

NextCommerce: This is with all of the ecommerce people in Maverick Next. I love that this mastermind is not just Amazon based, but more ecommerce in general. I find that learning only within your niche is very limiting so it’s important to branch out in other general areas and then apply those same types of ideas back into your business.

Nextcellerator: I was just added to this mastermind so I haven’t had the opportunity to attend a meeting yet. However, this mastermind is focused on taking the people doing over $250,000 per year and scaling them up to $1 million. Basically it’s a support group for implementing all of the business building and management tactics taught in Traction. Essentially everything I spoke about above with building a culture and having weekly 1 on 1 meetings, setting up KPIs, etc. In the next 6 months I know I am going to be doing a lot more hiring so this will be the perfect support group to help me through that process

ASM Aruba Mastermind: A couple of the guys from the Aruba trip reached out to me to see if I wanted to join their mastermind. I was skeptical at first because I’m already a member of 2 other masterminds and I’m starting to take my time extremely serious. So I jumped on a call with Jim the coordinator and basically interviewed him for about a half hour to see if it was really worth my time to join with them. I’m happy I did because I had my first call with them today before my flight and it was incredibly valuable. The group has a wide range of experience with some people on the lower end doing only $10K per month and a couple on the higher end doing over $400K per month. Normally that wouldn’t be a good thing because it’s so hard to relate to each other’s current situation, but they have been very specific about who they let in to the group so every member is a value add. One of the biggest take aways I got today was from Jessica who is doing similar revenue numbers as I am and recently hired an “Online Business Manager.” This person is essentially a COO and runs all of the daily operations in her company and goes out and hires outsourcers and manages everything for her. All she is focused on now is new product development. The COO works about 20 hours per month to manage it all and gets paid a salary of $1,000 per month.

She told me everything she did to hire this person and what certifications and experience she was looking for. She also gave me her job posting and a copy of the actual contract they signed together. I’m going to keep track of her progress with her hire for a couple months before pulling the trigger, but to get someone like that on my team would be invaluable.

 

Preparing for 4^th Quarter Madness

Last year I was totally caught off guard by the demand surge in Q4. With Thanksgiving, Cyber Monday, Black Friday, Christmas, and all of the other consumerism going on, people will buy anything. This year I’m prepared.

Well, I’m actually a little behind schedule because of all my traveling. I pushed off inventory ordering a little too long so a few product lines might be a little tight on replenishment, but overall I think we’ll be ok. If we do face any stockouts it will only be for about a week maximum, compared to last year where the west coast screwed me and I barely had any products to sell from December 9^th to the end of February this year.

My method for demand projections was much more sophisticated this year compared to last year. What I did was take all the sales data from last August to December and graph it for each product line. It was immediately obvious that demand for every product line spiked on October 31. This makes complete sense because Thanksgiving is at the end of November and people want to give it a couple weeks for shipping just in case.

After October 31 hit, most product lines spiked demand by 2 or 3 times and held that demand until I stocked out. So to come up with my projections, I took my current inventory and my average sales per day and assumed constant demand until October 31 so I could come to my estimated inventory levels on the day things start to spike. From there, I looked at Google Trends for the main keywords for each product line to see how popular the product was during the 4^th quarter. Based on the trend lines, I estimated 2x, 3x, and 4x demand for each product and I assumed that demand would last for 70 days after October 31. The 70 days takes us into January which of course is not realistic because demand will slow down after the last minute Christmas sales, but I used that number so I could ensure I had enough inventory to last me through to about February.

Next I calculated 4 different potential revenue numbers. The first was that across the board each product line doubled, the next was tripled, followed by quadrupled, and the last number was a mixture based on my Google Trends expectations for each product. This gave me my best case, worst case, and most likely scenarios for the 4^th quarter sales. In my worst case scenario, I think I’m going to do at least $500,000 in sales!

After basically completely missing out on January through March, I didn’t think it was going to be possible for us to cross the 1MM mark this year. However, with the way the 4^th quarter is shaping up, I think we will have a very good chance of crossing that milestone.

The next step after projecting was to make sure that no matter what we had enough inventory. Even with the loans from the bank and the biweekly payouts coming in from our current sales, it’s looking like I am going to come up about $20,000 short on the amount of money I need to order sufficient inventory. That number is still a question mark though because the shipping expenses are still a variable.

The other day I went out and sat down with a couple different banks to see if I could secure additional financing ahead of time. My meeting with Beneficial Bank went very well and they basically said they would be interested in buying out my loans from Citizens and then giving me an extra $20,000 on top. This is of course assuming the application process went well and they would want me to move all of my banking over to them. After I got that offer, I called up Citizens and told them I was shopping their rates and to see what else they could do to help me out.

Unfortunately, the Citizens thing dead ended because MRI is still less than a year old and loaning money out to Hyacinth is too risky because they only have last year’s tax returns to go on. Amazon has also offered me a loan for $19,000 but the interest rate is very high on it. It would cost me about $1,000 just to get the $19,000. It’s an option on the table, but not a very attractive one. Switching to beneficial is also a potential, but again not super attractive because switching banks can be a bitch.

Right now I’m working on figuring out the shipping expenses and seeing what product lines we can consolidate together to make things cheaper. Once I have a legitimate pulse on my costs, I can move forward with the extra financing or not.

New Products For Christmas

After seeing my projections for 4^th quarter, I decided that it would be even better if I added 2 new product lines in time for Christmas. Again this is where I was a bonehead by not placing my orders sooner due to travel, but I think we will still get them in on time. I was seriously looking into Grill Lights, Burger Presses, and Salad Spinners as potentials before I left for Europe. Due to timing though, I knew I wouldn’t have the resources to fully launch any of those by Q4. Instead, I decided to partition out the Skewers into their own product line and the Spatula into its own product line. The only thing I really need to do to launch these is to design packaging for them and we are good to go.

Another thing I’m looking into right now is rubs and spices sourced in the USA. Whenever I tell people I’m in the BBQ business, they always ask me about what kind of sauces we have. I’ve never wanted to go that route because I don’t want to deal with the headaches of food spoil. However, one of the conversations I got into during Camp Maverick totally changed my mind on this subject.

Right now we are constantly looking for new customers. By adding spices and rubs (long shelf life), we can add more of a continuity element into the business and start retaining our customers for the long term. This is such an obvious strategy and something I advise people on all the time. Sometimes the solutions are right in front of your face, but you’re too close to your own business to realize them. Another great recommendation I got was to partner up with Omaha Steaks as an affiliate.

Speaking of Camp Maverick…

As you can imagine, the camp was absolutely epic! I got food poisoning the first 2 days so it cut into my networking a little bit, but I pulled through and had a blast the 2^nd two days. Some of the highlights that came out of the camp

• Cleared the air with Shane about the ASM 4 launch debacle
• Hung out with Tucker Max and Mike Brubeck (his company imports 24 tons of marijuana into the US per month) and got a lot of relationship advice. It started out with Tucker helping Mike strategize on how to find a wife since he’s 34 and looking to settle down. Then it expanded into some advice for me and this guy Dustin as well.
• Learned a ton from Cameron Herold about PR and the ups and downs of entrepreneurship. Cameron is the guy that took 1800gotjunk from around 10 million per year to over 100 million in only a couple years. Now he’s the business coach for super successful CEOs running 8 and 9 figure businesses
• Met Dan Go, who runs a large fitness company. He lives in Toronto so I introduced him to my buddy Trevor from Blacksmith to help make that connection
• Met the owner of Nature Wise, which is a 14 million per year supplement brand. Starting talking about exit strategies with him and then introduced him to my friend Jock who is a business broker. If David decides to sell, that would be a huge connection I made.
• Spent a good amount of time with Andy Nulman. He was the CEO of the just for laughs comedy festival in Montreal, has exited multiple business throughout his life (worth over 100 million), and actually teaches a class at McGill University. I spoke to him about Tim Murdoch and secured an introduction between the two of them as well.
• Jason Hanson from shark tank was there. He was the ex CIA agent that runs an escape strategy boot camp. He tied us up and taught us how to escape from Gray Tape, Zip Ties, and Rope. Really cool experience

Current Product Issues

Right now I am dealing with way more product quality issues than I would like. We literally have issues going on with 6 out of 9 product lines at the moment! When shit goes wrong, the stars align to make sure it all syncs up.

Grill Brush and Thermometer: These products don’t have quality issues per se. What actually happened to them was they were cannibalized by the market. New models were developed for both product lines and we were slow to react. In fact, we didn’t react at all. I ordered a ton of inventory for both products because I wanted to have enough to make it through the summer. That estimation assumed demand would be the same this summer as it was last summer. When the newer and better models hit the market, my demand dropped. Now I’m stuck with a ton of inventory and I can’t roll out a new model until I either liquidate it or take a loss.

I don’t want to take a loss because I’m dealing with thousands of units. Right now, my strategy is to drop my prices as low as I can to still remain somewhat profitable on them while at the same time offloading as many as I can during the 4^th quarter. In January, we’ll assess our inventory levels and the market and determine a strategy moving forward so I can make sure we have top of the line models out there for the summer.

This type of product line cannibalization really hurts momentum. By the time I see the new models out there, it’s already too late because my competitors have a good 3 months advantage on me in the market place. To ensure this doesn’t happen again, I need to build some type of follow up process with my manufacturers so we can stay on top of new developments every month. Ideally, if I can get a product development person on board, part of their job could be to stay on top of market trends.

Temperature and Smoke Magnets: Everybody always complains about everything being made in China, but the USA is just as bad. We are crushing through magnet sales right now selling over a thousand per month. The magnets are supposed to be outdoor magnets that can withstand rain and sun shine. Apparently that’s not the case. The magnets are really just a sheet of vinyl laminated to a magnetic backing. The glue used for lamination is incredibly weak so people are reporting the magnets just falling apart after a few days of being outside.

When you are selling at the volume we are selling right now, this type of error is catastrophic. The 1 star reviews and negative feedbacks are pouring in right now. It’s gotten so bad that I completely changed the product descriptions on both pages to be a simple FAQ about what is going on and how best to treat the magnets. Everyone sees the 1 star reviews on the page, so I figure why not hit them head on and explain what we are doing to solve the problems.

I’ve also pushed heavily on Tina and I’m forcing her to source a new magnet factory for me. Tina works for Astro Dynamic, which is a local print shop. I recently found out that they were just subbing us out though to some other magnet factory. I’ve got a lot on my plate right now so I basically told her that she better find me a solution to my problem or we’re pulling the business from her.

Grill Sets: Our most recent batch of Grill Sets also had some quality issues. I’m not sure what the specific quantity was, but a portion of grill sets missed the buffering portion of the quality control process. This means customers were receiving spatulas and tongs with sharp burred edges on them. We went through a flurry of about 50 people freaking out about it and we had to issue a lot of refunds and exchanges. Things have settled down on that front, so I think we are in the clear. Overall though, this can’t be happening. I came down pretty hard on Tracy about the quality issues so they are comping me on 100 grill sets and they are paying extra special attention to our next batch to make sure the quality is there.

Kabob Sets: When I ran my sample Kabob Set through the dishwasher it rusted. My manufacturer rep Anson told me that it rusted because they used a lower grade metal for the sample. On mass production they would use stainless steel. We then got into about an hour long conversation about dishwasher safe being a requirement and I was assured it would be ok.

Now after selling over 1,000 kabob sets and advertising them as being dishwasher safe, I’m receiving reports from customers that they are rusting in the dishwasher. You have to be fucking kidding me! When I spoke to Anson about the issues, his response was that they don’t have dishwashers in China so he didn’t know. I even copy and pasted his direct response about them being dishwasher safe into our conversation. It turns out that they did use stainless steel in the production, but it was a lower grade stainless steel that doesn’t hold up well in the dishwasher.

I basically told him that this was his 2^nd strike. If he wanted to continue with a long term relationship them there couldn’t be any more fuck ups. I’m not the materials expert. My job is to ask the right questions and his job is to find the answers for me. I let him angle around to save face, but he knows the relationship is on the rocks right now. They had already started manufacturing for our 4^th quarter replenishments, so I made them scrap it all and start over with the new higher grade stainless steel.

I then removed all mention of dishwasher safe from the Amazon listings and email communications. The problem is that it’s written in big font on the back of the packaging that it is dishwasher safe. Now that I’m thinking about it, I might as well expressly communicate via email that they are hand wash only so I can avoid any other future issues until we turn the inventory.

Overhauling Our Marketing Funnels

I’ve started mapping out how we are going to completely overhaul our marketing funnels. We have a ton of infrastructure in place that is being underutilized right now. The new way it’s going to work is going to be very logic based email marketing. All advertising is going to be driving toward top level opt ins on broad category based interests such as food. Right now the top 3 funnels I am going to work on are the recipe book, the temp guide, and the smoke guide.

Once they are in my email lists, I can then tag them and segment the lists to send specific offers to. For example, we could send people a couple youtube videos about steak recipes and then follow up a few days later with our Omaha Steaks affiliate offer. We could tag people so we know which products they purchase and what would be good to offer them. For instance, I already know that people who bought our thermometer are 30% more likely to buy the meat hammer. We can use this data to our advantage in very targeted email campaigns.

The possibilities for logic and automation are huge right now because we have so many product lines. However, this is no small endeavor. I’m estimating it is going to take me about 3 weeks of focused work to put it all together the right way. Getting it all set up is just one part of it though. To manage this thing is going to be a job in itself, so I’m also going to have to hire an email marketing person.

Here’s an example of what I envision the Recipe Book Funnel to look like:

At the top we have traffic sources that go to a recipe book squeeze page. When they confirm their subscription to the list, they are immediately offered the chance to buy a physical copy of the book. (Just need to format it for Createspace to sell physical copies). Regardless of the decision they make, they receive a content email a few days later that includes a youtube video involving really good steak. A few days after that, they are offered a special deal on Omaha Steaks. Then we go back to some content emails, which lead up to an offer for the Temperature magnet 7 days later. If they take the temp magnet, they are immediately upsold on a special deal for the digital thermometer. We then go back to some content emails that build up to the Wood Smoking guide offer 7 more days later. Again, if they take this offer they are immediately upsold on the Smoker Box product.

This whole process will take about 14-20 days to complete. At the end we will offer for them to join the VIP list and we will move them over to the general list for lower frequency mailing. Throughout the entire process we will have the ability to tag them based on the actions they have taken. We can then use those tags later when segmenting the list for other types of campaigns.

Another awesome idea I had was to overhaul the recipe book. The recipe book gets offered for free to every single one of our customers. That’s a huge touch point, so what I’m in the process of doing is creating banners for every product funnel we have and sticking them in to the footer of the recipe book. Each product has an evergreen 20% off coupon funnel so essentially what I am saying is that if you buy one of our products we will continually offer you 20% off anything else as long as you get on our list.

This is going to be a huge strategy for increasing our list size and making sure everyone that buys from us gets on it. We’ll still be profitable, but at a lower margin for the repeat business. That’s ok though because now instead of having 1 or 2 Cave Tools, most people will have a whole bunch of our products. All the sales will also be funneled through to Amazon so we will increase our rankings and also manipulate the “Customers Who Bought This Also Bought This” section.

After they go through those funnels and buy on Amazon, we then start tagging them in our email database and directing their future purchased back over to our website.

As we sell to more people overall the recipe book gets that much more exposure. That means our product funnels, Omaha steaks offer, vip club, social media channels, and all the other offers get that much more eyeballs on them. With this change alone, I think we can take our email list from the current level of 2,000 people to over 10,000 people 6 months from now.

Now imagine the type of power I can have with that kind of list. Take our current thermometer issue where we are suffering from rankings and sales because of newer models out there. If we had a fully tagged list of 10,000 people and knew that 9,000 of them hadn’t purchase the thermometer yet, this is an example of what we could do. Segment the list into groups of 1,000 people each. Create a different coupon offer for each group of varying discounts. Then each week for 9 weeks we could mail out the offer to each group of 1,000 people and totally blow through all of our excess inventory and still remain profitable because we would be controlling everything. Even if only 5% of people took the offer, that would still be a movement of 450 units which would be plenty to spike our rankings for a targeted keyword on Amazon and let the organic sales take over.