B2C relationship-building

One of the nice things about B2B sales is that you can make a list of potential customers and go after them one by one, relentlessly. That list can be large and it will change with time but at least it is possible to make one. 

For example, At EMcision we sell our products directly to specialized surgeons in the US and through distributors everywhere else in the world. In both cases we are able to build a list of leads that grows over time and we proactively reach out to each lead and push them along our sales funnel, hoping for a conversion . Since this list is finite, we are also able to do hyper-targeted content marketing and invite them to activities that help us strengthen our relationships with actual and prospective clients. We also build increasingly complete profiles for each of our clients. It is far from easy and my sales team works extremely hard but the process has the beautiful advantage of being predictable and repeatable.

In contrast, I have always found it much more challenging to do the same with B2C sales. Especially with a business like FreshMint where everyone is a potential customer. We can’t simply create a list of everyone in Montreal and start calling them. That would be difficult and spammy. 

Last night we ran an experiment, which I think worked really well. We hosted a taco-themed cocktail party for our top customers. What made this party special is that there was no agenda, no speech and no real objective other than getting to know our customers personally. The whole thing was a breeze to plan and execute and we got a lot out of it.

In a nutshell, here is how we did it:

  • Ranked all our customers by RFM score and invited our top 50 customers.
  • Created a simple contest on KickoffLabs for customers who are not necessarily in the top 50 and still wanted to come to the party. We picked 20 entries with an online random number generator.

About 40 people showed up and we had a great time. More specifically, this is what we got out of it:

  • Put faces to names we see almost on a daily basis in our order list. This creates an emotional bond that goes beyond a transaction. There is nothing like a doing a few tequila shots with customers to start a friendship. As a sidenote: it’s incredible how off we can be when we picture a customer or make assumptions about them vs how they are in reality.
  • Got feedback about things they liked / loved / hated about our service. Clearly this is skewed because top customers obviously think we are doing something right but still got a lot of constructive suggestions.
  • Generated new opportunities and ideas in completely new areas for us.

I realize that it might not be easy or doable to do this with every business (e.g., e-commerce company with mostly out of town customers). But I strongly encourage every business owner, especially those who are mostly online, to organize events to meet their customers face to face in a casual environment on a regular basis. The benefits are just immense. I know that we will be now running these events a few times a year.

Working alone sucks

I am the CEO of a small healthcare tech company. My biggest source of job-related dissatisfaction is the fact that I work alone most of the time. I’ve always disliked the “It’s lonely at the top” arrogant cliche but now I must say I am feeling it.

My team of about 20 is distributed around the world. We have sales reps in the US and in Europe, all working from home to be closer to their markets and travel to see their clients. Due to legacy reasons, we have engineers working out of one European facility and a clinical team working from another European facility. I am sitting in an office in Montreal with two colleagues. I don’t have a CFO, COO or other peers with the same overall picture of the company and incentive structure that I have. I send progress reports to my Board of Directors once a quarter who nicely acknowledge receipt and ask some questions but don’t challenge me in a meaningful way.

Because my team is mostly remote and we don’t have any local customers yet, I spend the vast majority of my time dealing with emails and talking on the phone. Just thinking about my daily office routine reminds me of a Hemingway quote:

There is nothing to writing. All you do is sit down at a typewriter and bleed.

Anyone who knows me will tell you that I am (hyper?)active, extraverted and social. Sitting in front of the computer alone all day is as sub-optimal as it gets for my character.

In the first company I started, I had 2 co-founders who were also best-friends. We all sat in close proximity and had a weekly “Partners’ Dinner”. These dinners were a great time to share the ups and downs of the week and jointly steer the vision of the company. Later, when I worked in a management consulting firm, I mostly sat with my team around a large table in the client’s office. We traveled together, worked together, ate together and went out together. We also had frequent client interactions during the day. Overall, the sometimes annoying loss of privacy from Monday to Thursday were outweighed by the friendship, camaraderie and strong professional ties that we formed during that time.

I have only started realizing the negative effects of working alone on my mood and performance. As a result, I started getting involved in many activities outside of work to try to solve this problem. Some activities were helpful, while others further exacerbated my feeling of aloneness.

As example of a not so helpful activity, I went yesterday to a lunch event were I was told we would discuss the main issues affecting Canada/US trade for SMB’s. As about 50% of our business is with the US, I figured that would be an event worth attending. As it happens, we were probably only 3 entrepreneurs (out of 50) participants . Everyone else there was from some kind of government organization pushing their “program” or a service provider who was there to network. The lunch lasted 2.5 hrs and was filled with non-practical macro generalities (US exports represent 67% of Quebec foreign trade) and needless ceremony (“we are so honoured to have with us today Mr X, he is Honorary Chairman of Y committee”). It is impossible thatanyone gained something practical and valuable from the lunch. Driving back to my office, I felt even more isolated. I felt like I wasted time without any benefit whatsoever.

Of course this is only one failed example in a series of more successful attempts to find a solution to my situation. This post is getting longer than I intended it to be so I will stop here and write again soon about some of the things I am doing to improve my solitary working environment.

Update: This post has generated an interesting discussion on HN (http://news.ycombinator.com/item?id=4921047). I should emphasize that it is not physically being alone (i.e., not enough contact with other people) that bothers me, it is the lack of peer-level teamwork towards a common goal that I lack. 

Please stay classy and stop copying Birchbox

I just got off a transatlantic flight and I am writing this on my iPhone so please excuse the rambling.

I met BirchBox’ Hayley and Katia in the summer of 2010. They had just graduated from HBS, had a few hundred monthly customers on their service and weren’t sure whether they would be able to raise a seed round.

They were two lovely ladies trying to make it as first time entrepreneurs.

Fast forward 2 years and the story is completely different. They are darlings of the NY startup scene. They are poster childs of the tech+fashion trend. They raised more money than I’ll ever see in my life. They are signing up paying and recurring users by the boatload. They are apparently very profitable.

And they are still two lovely ladies. They haven’t become too cool for school.

I went to an event where they spoke about the experience last year. After their talk, a couple of guys I knew went up to them and asked them for all kind of operational metrics. Hayley and Katia were gracious enough to indulge them with as much info as possible.

A week later, these guys wanted to have coffee with me to get my thoughts about a new startup they are launching. You want to guess what it was? Yup, a BirchBox for guys. “Imagine every month you get a tightly curated box of shaving cream, hair gel, condoms, etc”. I

don’t know about you, but I really don’t need a tightly curated selection of condoms every month. I am also quite satisfied with my Kiehl’s shaving cream I have been using for 10 years. Would I consider switching? Absolutely. Would I pay $10/month to two clueless frat boys to “curate” my grooming products? Absolutely not.

BirchBox is successful because the girls are passionate about their product. Katia worked for Estée Lauder and has an intimate knowledge of how the beauty industry works.

That first clone launch an folded a few month later. Nice lesson for the founders, no harm done. My problem is that people are still copying them every day. I received 5 BirchBox clone plans in the last 6 months. One of them is a legit twist on the subscription model by people who know something about their market. The other 4 are just plain rip offs with either a different geographic focus (“Europe is completely greenfield for this”) or a different gender focus (“curated condoms”).

Please stay classy and stop copying BirchBox. You will not succeed unless you somehow innovate on their model or know something extra special about the market you are entering.

Update: BirchBox Man launched a few weeks after I wrote this. I hope this taught everyone who ripped off the original BirchBox that you can’t just blatantly copy someone’s else idea without having a secret sauce or a unique differentiator.