DTC #111: Still feels like day zero
It's 12 months building a consumer brand. At start, I was unconventional. Took blind risks. Now, I am scared. I feel we are starting from scratch. Improving everything we have done so far. Anxious.
👋 Hola! Welcome to Out of Singapore. I am Shan and I write about building business in Singapore. I closed my first business at the end of 2022. Then joined a CPG innovator in Singapore to launch and scale their brands. I didn’t know much, I was just confident. I took the bait. There was nothing to lose. Today after 12 months, there is so much to lose. I am scared. 😓
What’s there to lose?
Business - The brand could stop growing. Worse, revenues would fall. Every month, I get a new shock.
Professional - 1 million means nothing. 100 million means something. 1 billion is rockstar. Can I cross over to the 100 million club? (annual revenue)
Personal - Last 4 years has been tumultuous (overall positive). Will I achieve better results this time?
Financial - I can finally pay myself a respectable salary. Will I lose it? How do I safeguard my financial security (something I didn’t have for 2 years)?
There is enough to lose. Enough to pull me down in all spheres of life. Makes me feel scared. The business is still in infancy. We are at day zero. Why? Let’s dig in.
We will discuss the topic in 2 sections. (yay, today will be short 🕺)
Why do I feel it’s day zero after 12 months of building?
How do we get to day 10 or day 100 from here?
Let’s start.
#1 Why is it day zero still?
Let’s get down to the facts straight.
Dependence on paid traffic - 70% of traffic to DTC is driven by paid advertising. What happens if we don’t have money for a few months? Can we stop advertising? Will we get orders if we stop paying for traffic?
The dependence is on a single source - Facebook. There are days (a lot of them), that we don’t even get our money back. It’s a big forest fire where we drop our marketing budget from a helicopter each day.
Running ads is not just about ads but content. Generating content is a daily activity and costs effort and time. (am I looking for free lunch? 🤔)Low order volume - Getting orders is a daily struggle. Sometimes it is 40 orders, other days 100 orders. This is split into multiple channels. We are missing daily consistent high order volume. I am talking about 1000+ orders a day.
TikTok shut down our shop - TikTok compliance team (TikTok police) does not tolerate weight loss and sexual wellness claims. They do not even accept “metabolism" booster. They shut down our last shop, which had garnered great reviews and reputation. We lost all our customers (no record of them since TikTok controls their data). Now they have “shut down” our top live stream seller. Shopee has been the most well-behaved platform that let’s brands sell in peace. However, Shopee grows slow.
Daily redevelopment - We are redoing everything everyday- packaging, website, product information and listing, social media and team. During this one year, we changed ecommerce platform mid way. Since then it has been new tweaks every week. Right now, we are redoing the entire product page for higher conversion.
Should the team change? Is the same team that built from zero to 10, right for the next stage of 10 to 100? Do I need to bring in experienced operators (not experience senior directors)? Should we change the we achieve the results today? Do I cut down on outsourcing? Should I move everything in-house? How to get everyone to think for next 100 million?
Low on cash - Okay, we have run out of initial funding and now running on actual cash flow. Which is great because the business is sustainable. How do we grow from here? How do we get the cash for market expansion? How do we get cash to acquire next 100,000 customers?
In essence, everything is day zero. The business doesn’t run by itself (am I dreaming here?). Whatever has worked in past few weeks or months is not guaranteed to work forever. The tactics have to evolve everyday.
#2 Crossing the chasm to reach day 100
Day 100 is when I can sleep for 30 days straight and not worry about the business failing (again, am I dreaming?). Okay fine, day 100 is when the business is pull based - market demand calls for more inventory and more sales - that’s day 100.
How can we reach day 100? Here are my initial thoughts. I am sure I will add more in next few months and years. Be with me, okay!
Traffic generation (demand gen) - Website traffic has to be de-risked from paid channels. It must be de-risked from a single paid channel. We have to build organic traffic via social media and community partners. I imagine a time when 70% of traffic will come from warm organic traffic. The audience would have heard about us on social media, or a friend would have recommended or they saw us on a retail store shelf.
Build brand awareness (and reputation) - This is tough bit. It is part presence, part authority and part community. Until now, marketing content has been tight (less and conservative). Now we need to jump into content making game across social media and paid advertising. Should be fun!
Firm up sale channels (distribution)- This would include scaling current sale channels to 10x of current levels and building new ones. New channels would be retail chains in Singapore and distributors in rest parts of the world. Potentially, set up new market teams to do it ourselves (would be tough and needs millions in capital).
Profitability - We care about margins and costs now. The business needs to run sustainably, generating extra cash flow for reinvestment for expansion. This needs a lot of grinding and discipline daily on numbers.
Grow 10x (at least) - We cannot slow down at this stage. The brand needs to grow multiple more times in next 1-2 years. Seems tough ask, but that’s needed to build a strong sustainable business.
Build a team (with culture)- This is the toughest but most crucial bit. The team needs to be highly motivated and experimental. They should not be shy to break away from tradition. It needs zeal to succeed. We do not need “corporate employees for a 9-5 job”. This is culture building, won’t come easy (or cheap).
It’s day zero, and I am looking at day 100. The target is non-negotiable, we will reach there one way or the other. That’s it for today! Thanks for reading again 😍
Please like and share with your friends. I will be grateful. 🙇
Today was a long day. Two events - one was a body building contest that we sponsored and another was a meetup (which we hijacked). I was thinking of dressing down but glad I did not! Dressing down (due to heat and “humility”) is my daily struggle.
What’s up with Jisoo?
Let me introduce perplexity.ai to you. It is one my favourite AI tools out there for doing citation based research. Here is what it has to say about “What’s up with Jisoo?”
Jisoo recently opened up about her physical and mental health struggles, as well as her uncertainty about going solo. [1]
Jisoo said she is not sure if she is ready to go solo yet, as she is still trying to figure out what kind of music she wants to do. She loves songs with lots of instruments and rock music, but is unsure what people want from her. [1]
Jisoo also discussed the difficulties of being a global pop star, saying she sometimes finds performing more like a "test" than something genuinely fun. She has dealt with injuries from intense choreography, like hurting her back at Coachella. [1]
In addition to her music career, Jisoo has been expanding into acting. She has a leading role in an upcoming zombie drama and will star in a film adaptation of the webtoon "Omniscient Reader's Viewpoint". [2]
Jisoo recently went through a short-lived public relationship with actor Ahn Bo-hyun, but they broke up after just two months due to their busy schedules. [3][4][5]
Overall, Jisoo seems to be navigating the challenges of fame and her own creative direction, while also taking on new acting projects. She is being open about her struggles with physical and mental health as a high-profile K-pop star. [1]
Citations:
[1] https://www.billboard.com/music/music-news/blackpink-jisoo-going-solo-performing-through-pain-mental-health-struggles-1235078393/
[2] https://en.wikipedia.org/wiki/Jisoo
[3]https://www.reddit.com/r/BlackPink/comments/17f5xa2/231024_yg_entertainment_blackpink_jisoo_actor_ahn/
[4] https://www.soompi.com/article/1621674wpp/blackpinks-jisoo-and-ahn-bo-hyun-confirm-breakup
[5] https://www.j-14.com/posts/is-blackpinks-jisoo-dating-actor-ahn-bo-hyun-statements/
But can we live without Jisoo GIF? No, absolutely no.
Thank you so much again! Have a great week ahead! I need a break from life 🫠