I recorded this episode of the Ecomm Swipe File with Eric Banholz, CEO and Co-Founder of Beardbrand, one item we talked about was their decision to move off of Amazon, and what the results were. With the news of Nike moving off of Amazon this week, I thought it would be interesting to share these results. Watch the full interview below, with Eric talking about moving off of Amazon at the 3:27 mark.
The Decision to Move off of Amazon
Eric and the Beardbrand team found that even though they were working with Amazon, they still had to compete. Rather than Amazon bringing them more customers, they were cannibalizing their own business.
The one area they could compete with Amazon was customer value adds. This mean product knowledge, style advice (as talked about in the first part of the video using SMS)
Everyone told Eric that moving off of Amazon would be the worst business decision they could make, and it was a risk that they knew they were taking. What happened next, couldn’t have been better for Beardbrand.
What happened after leaving Amazon?
- Beardbrand saw an increase in their average order value doubling from $25 on Amazon to $50 on Beardbrand.com
- Significant increase to the number of sales on the website
- Reduced costs by not having to manage multiple channels, and competing with blackhat Amazon sellers.
Why did this happen?
We will never know the exact product behaviour, but just as the theme of Klaviyo Boston was owning everything around your customer experience, you can’t own that customer experience on Amazon. On your website, or when someone talks to one of your customer service agents, it’s easy to suggest the products that you know go well together. For example, if you’ve bought a balm from Beardbrand, they may suggest one of their beard oils because they know the ingredients don’t impact one another, and the fragrances smell nice and work well with one another.
On Amazon, these recommendations are automatically generated - most likely based on what the data shows will sell best. Regardless if this is one of your products. In addition to losing out on revenue, this can impact your brand experience. If your purchase comes with a premium product like Beardbrand makes, and a low cost accessory, such as a beard oil made with alcohol that dries out your skin, it can have a negative impact on the overall Beardbrand experience.
Ultimately, Amazon is a very viable channel for many sellers and brands, but Eric and Beardbrand chose to be more in-control of their of their entire customer journey. From answering product questions nested in their instagram ad comments, to providing post purchase style advice.
The Full Conversation
View a full transcript below. Please note, that this was generated, so we cannot gaurantee 100% accuracy in transcriptions.
Lucas Walker: Hey, what's up everyone? It's Lucas here. Another episode of the Ecommerce Swipe File. I'm in Llandudno Wales, and I just happened to see a barber shop I've been to before called Harry's. I noticed that they had a couple ring lights. I asked if I could pop in, film a bit of content, and he said, "Absolutely." They said, "What are you filming?" I said, "So I'm watching this vlog podcast featuring a lot of brands including Beardbrand. One of the lads who's actually just right over there, I don't know if you can hear the clippers, he's cutting hair right now, but it was Beardbrand that really inspired him and really taught him how to start cutting hair."
Lucas: In this episode I chat with Eric, who I've known for a few years now. He gave me some great advice. We talk about ways to make money online, what a great website looks like, what you should strive for, why he got off Amazon. That's actually a trend that we're seeing a lot of. There's a lot of brands looking to really own their marketing, own their customer relationships. The last thing we talked about is the power of brand, which as we see here, I'm from Toronto, Beardbrand's based out of Washington and Austin in the US. Here in the United Kingdom, he's inspired others to get into the male grooming industry. That's the power of a brand that goes so far beyond any sort of a financial or monetary gain and really going into the legacy. Enjoy.
Lucas: I'm with the Beardbrand founder, Eric Bandholz. If you're watching this video, you've probably seen Beardbrand either on Reddit on the internet, in the shop [inaudible 00:01:30] on Shark Tank, everywhere. I've been following Eric for a long time before I launched Treats Happen, Eric actually did a site review and gave me some great feedback, which I still take to heart today. What I share with a lot of people in that was would you buy from this website? Does this website look like something that you would purchase from?
Lucas: Also, we were trying to do little $1 add on products. You pretty much told me fuck that shit. You're working really, really hard to get people to your website and they'll put in their credit card to buy something with that's a dollar. They get five bucks or 10 bucks, you're not losing money on that. It's really just that add on item. You throw it in as a bonus if they come back later. They like it, especially when you're first starting out. Thanks so much for those tips. I have a whole bunch of questions. Let's start off with the typical blog format. What's sort of one thing that you'd done with your brand lately that really helped you out that any other merchant could kind of take and replicate with themselves?
Eric Bandholz: Yeah, I mean for us it's the most important thing that we do is focus on our brand and our core values and what we're trying to do and bringing it back to the mission. We're very mission oriented and by having that mission it allows us to focus on how we create emails, how we write blog posts, how we write social media tweets, and things like that and how we engage with our customers, improve customers.
Eric: Probably the most exciting thing that's going on right now is our SMS program. Customers who buy from us, they have the option to opt into text messaging. When they opt in, we'll send them a text message that says, "Hey, thanks for your order. We provide style consulting. Take a picture of a selfie. Send it to us and we'll tell you how to do your hair and beard."
Lucas: Oh, that's awesome.
Eric: Yeah, so we want to do more customer value add to our customers right now and really kind of create this moat around our customers.
Lucas: That's really fun. If you're thinking out loud, you could almost do that with anything. If you buy a poster, "Hey, send a picture of your living room and we'll show you the best place to hang it or whatever else."
Eric: Oh, yeah.
Lucas: That's really cool. The other thing that we've chatted a little bit about on Friday night was moving away from Amazon, which I've seen a lot of brands kind of trying to do under the radar. We used Amazon the most as our abandonment strategy. If people just want a single unit, but I mean if you can share what happened when you came off Amazon and really why you have that disdained for Amazon.
Lucas: Don't hold back.
Lucas: You can swear. You can do whatever you want in the video.
Eric: Yeah. Yeah. I'm not too fond of Amazon. The strategy I just talked about, what we think about in house is a consumer is considering Amazon as a valid option and to really compete against Amazon, you have to figure out what can you do that Amazon can't do? One of those is customer value adds. Last year at the beginning last year we actually pulled off Amazon. Everyone told us that that's the worst decision. You just make so much money on Amazon. By not being on Amazon, you're a fool, but we actually saw an increase on their sales significantly on our website by pulling off Amazon. What I think was happening was people would shop on Beardbrand. They would go to Amazon and buy. Then on Amazon, Amazon would recommend generic brush or comb, so our AOV on Amazon is 25 bucks, whereas our AOV on our website's 50 bucks.
Lucas: You're not paying the 30% Amazon referral.
Eric: Yeah. Then we don't have to manage a different channel, manage listings, worry about black hat people, or fake reviews, and all that stuff.
Lucas: Yeah. Yeah.
Eric: Amazon is getting the data on your sales and if you're successful enough brand, they're eventually going to make their own product, AmazonBasics and rip off your product and push their product ahead of yours.
Eric: There's a lot of risk as to building your business on somebody else's back. I've just always been a big fan of being in control of our destiny and our future. It's a lot harder. It's harder to drive traffic to Beardbrand.com, but once you start doing it, it makes it a lot more stable. I sleep really well at night.
Lucas: Yeah. My last question on that is, you are probably one of the first, if not the first, really making beard oil a common product that men like us need.
Lucas: How have you dealt with the increased competition of both just more supply out there for customers, but also lower quality driving down prices, so people might not want to pay 29 or $39 for your product when they see it for 14.99 elsewhere?
Eric: No matter what business you have, you're going to have competition. Even if you don't have competition, then your competition is typically ignorance towards your product.
Eric: We always knew there was going to be competition and subsequently I can't control the compensation. I can't control what they do. All I can control is what we do.
Eric: We just focus on our customer and how we can bring value to our customer's lives.
Lucas: I like that. Build trust.
Eric: Yeah. Yeah. We've got, in my opinion, the best product. With the best product, there's always room at the top.
Lucas: Even, like you were saying, the utility bar, I'm sure people look at and say, "Oh, it's just a bar of soap." They don't realize there's no palm oil. There's three years of research and development that went into that product.
Eric: Yeah. You don't have to worry about TSA and the liquid. Our utility bar, it works on your hair. It's a shampoo. It's a beard wash, body wash. You can use it as a shave soap as well, so you can keep tidy in all one product and just travel light. I mean we've tried to make products that aren't available on the marketplace and sand out. Maybe they don't want to appeal to everyone and that's okay. You know, we're not trying to be the next Proctor and Gamble. We're not trying to be L'Oreal. We're not trying to appeal to everyone. We're trying to appeal to our customers who are looking for these types of products.
Lucas: Well, on that note, I normally keep these at two, three minutes. We're over seven already, so I really appreciate it.
Eric: [crosstalk 00:06:55].
Lucas: My arms are getting sore, so I'm going to have to wrap this one up. Thanks so much for being a part of it and I'm glad that we could finally meet in person.
Eric: Yeah, thanks for having me.
Lucas: I actually mention the product in this vlog with Eric, the utility bar. I'm on the road all the time. I've been on the road sort of 36 of 58 days, almost two thirds of my time is travel. Love that the utility bar is great, hassle-free, can be used for a lot of different things. Actually, the best leather I've ever had in a soap, so I'm going to give away a three pack of those. To enter to win, leave a comment below where we were seeing this video. Maybe take a friend, or if you're listening to the podcast, take a screenshot of your review. Send it to me in an email, firstname.lastname@example.org. That's gorgeous, like the philosopher, not my gorgeous good looks. Enjoy