The Unlikely Path to Growth: Oliver Cabell’s Ecommerce Startup Journey

For ambitious startup founders and would-be business owners, one of the biggest questions you’ll encounter is how to grow your ecommerce company with a big idea but limited resources.

It can feel like a daunting challenge when you’re first starting out. That’s why our goal is to share how real founders did it. We’ll cover the good, the bad, and the ugly—and we don’t shy away from the real numbers that go into building a business.

In this post, you’ll hear the story of Scott Gabrielson’ high-end fashion accessories brand, Oliver Cabell, and how Gabrielson took this brand from a dream to a reality. You’ll also learn how to:

  • Get your ecommerce company funded
  • Find a manufacturing partner you can trust
  • Capitalize on cost-free marketing
  • Grow your ecommerce business

We’ll share Gabrielson’s story of how a business school grab with a dream of starting an ecommerce company managed to build a high-end ecommerce brand with waiting lists in the tens of thousands.

Exorbitant rent and student loan debt

When Scott Gabrielson completed his MBA program at the University of Oxford in the U.K., his options were limitless. He had a bachelor’s degree in finance and marketing from the University of Minnesota and four years of work experience as an investment banker, which meant companies were clamoring to recruit him.

But Gabrielson saw a different path for himself than the typical management consulting or senior investment banking roles expected of an MBA graduate. He imagined starting his own ecommerce business and moving to Silicon Valley.

 

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Restocked for summer. #OliverCabell

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Reality struck as Gabrielson searched for an apartment in San Francisco, where rent prices are at near criminal levels—due, in large part, to the flush tech scene and strict zoning ordinances and regulations.

Research from apartment finder platform Zumper shows that San Francisco has one of the “most expensive rental rates in the nation,” with one-bedroom units going for $3,590 a month. Two bedroom units cost an alarming $4,870. The ridiculous cost of living in SF alone can be discouraging for any would-be entrepreneur, and it was an especially sensitive topic for Gabrielson, whose year-long MBA program at Oxford cost him nearly $85,000 out of pocket.

With a big chunk of his savings gone, Gabrielson knew he had to be strategic with his next move; he expected his latest venture would take several months to go to market and then additional time to prove the business model before he could even think about raising funding (both are common prerequisites for securing seed money and venture capital for first-time founders).

Finding funding in the midwest

Despite his inability to raise capital from private investors, Gabrielson was determined to find alternative sources of funding to fuel his business’ growth and mitigate his personal risk. So he sought a bank loan. For TIME, credit and financing expert Gerri Detweiler reports, “The banks [Gabrielson] met with were supportive, he says, but were reluctant to lend for an online retail startup with no collateral.”

At this point, Gabrielson’s options were incredibly limited. His idea to launch Oliver Cabell, a high-end fashion accessories brand, would most likely have to be self-funded. And, for entrepreneurs with a day job, those costs are easy to swallow. Yet Gabrielson was all in on the venture and, without a steady income and with dwindling personal savings, he had to find money elsewhere.

In her article, Detweiler writes,

“Through a referral from another business owner who had secured a small business grant, [Gabrielson] found the answer in a program called Innovate ND, a program that helps grow small businesses in North Dakota. Though he had incorporated Oliver Cabell in Delaware, Gabrielson established a presence in North Dakota to handle product fulfillment, which made him eligible for the program. In addition to becoming a source of capital, the location offered other advantages, including lower wages and a geographically central location that he expects will make it easier to ship product around the country.”

And so, of all places, Gabrielson decided to start his business back in his home state of North Dakota, where he managed to secure $78,500 in mixed public funding, tells Gabrielson. Of that total, $50,000 came as a microloan with a 6% annual interest rate—a bargain for a business with no credit—and $28,500 was provided as grants—which don’t have to be repaid.

How other ecommerce companies can get funded to grow their ideas

Across the nation, there are numerous programs like Innovate ND that offer mentorship, networking, and financing for promising would-be entrepreneurs. A few popular examples include:

  • Amplify LA (Los Angeles)
  • Capital Innovators (St. Louis)
  • MassChallenge (Boston)
  • New Venture Challenge (Chicago)
  • Techstars (Various locations)
  • The Brandery (Cincinnati)
  • Y Combinator (Mountain View)

Many even consider and accept out-of-state applicants. Alternatively, you can go abroad to participate in programs such as SPH Plug & Play (Singapore), Start-Up Chile (Santiago), The Junction (Tel Aviv), and Wayra (Buenos Aires).

A year in production purgatory

Before Oliver Cabell was a full-fledged business, Gabrielson spent months networking with factory owners in Fermo, Italy, which is regarded by many as the premier manufacturing hub for high-end fashion products.

Gabrielson shares, “We didn’t know this right away, but Italian bag workshops [in Fermo] are the most guarded factories in the world. It took us almost a year to get the proper introductions to the factories we really wanted to partner with.” He adds, “They speak little English. They don’t have a website. They get so much demand.”

And, with already-established accounts with many of the high-end retail brands around the world, Gabrielson knew securing these coveted manufacturing commitments would be no small feat.

But, before his luxury backpacks and weekender bags could be produced, Gabrielson had to negotiate terms with factory owners who were used to getting asked to produce thousands of units at a time. Short on cash and eager to get his product to market, he had to be creative in his sales pitch. Gabrielson sold his manufacturing counterparts on three strategic pillars for his vision:

  • To provide direct-to-consumer product online (in a world where legacy brick-and-mortar shops are shutting their doors)
  • To offer a premium product at a fair markup with full transparency (generally, below a 50% margin)
  • To consistently manufacture in Italy (when margin-conscious retailers are increasingly outsourcing production to Asia)

The driving force behind Oliver Cabell was a desire to upend traditional retail, which Gabrielson felt was exploitative of customers and many manufacturing workers. He recalls, “I was working in business development when I first learned of the realities facing the fashion industry. In 2013, the Rana Plaza building collapsed in Bangladesh, killing over 1,100 people, and it put everything I had assumed about how fashion operated into question.”

A visit to facilities in Asia wasn’t very encouraging for Gabrielson either. “I saw cramped female workers, earning $7 a day to quickly glue and sew designer bags and accessories to cut costs and hurry the production process. One of the bags being made in this facility cost under $100 to make and sold for over $1,200 just down the road, clearly lacking the craftsmanship that you would expect from a high-end designer brand. That’s why I decided to launch Oliver Cabell. Our bags are created in Italy from start to finish with high-quality materials, time-honored traditions, and techniques that have been reserved for only the best-made accessories on the market today.”

 

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Those modern moments #OliverCabell

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Oliver Cabell’s ethics and mission instilled faith among the factory owners, who lowered their usual 1,000 unit minimum order expectations to 250, allowing the company to stock ample inventory for its launch.

Six months post-launch, Gabrielson’s relationship with his manufacturing partners has evolved and, with a newly streamlined supply chain, he notes, “We’re now able to push out new styles at a more rapid pace, and [the Fermo factory owners] are giving us a break on minimums for those.”

And, for a bootstrapped ecommerce business like Oliver Cabell, this is huge, since the company can test more products with less capital and less risk.

Capitalizing on cost-free marketing

Though securing nearly $80,000 in financing was a huge win for this small company, it was just enough to fund startup operations, which meant there was little room to budget for marketing-related costs. Yet, in under six months, Oliver Cabell managed to garner an audience of more than 40,000 email subscribers and 24,000 Instagram followers, while spending virtually nothing on advertising. Gabrielson attributes this success to two primary marketing channels:

  1. Public relations
  2. Word-of-mouth marketing

Free publicity

When his business launched, Gabrielson already had the ear of editors and journalists at Cool Hunting, Fast Company, Inc., and WWD, who were hopeful about the brand’s future in a fiercely competitive retail environment. This led to widespread coverage of Oliver Cabell’s mission to bring fair prices, quality, and transparency to luxury consumer goods.

What’s more impressive is Gabrielson did this without prior press relationships, an entourage of A-list investors, or a pricey PR firm (typical PR retainers cost anywhere from $5,000 to $25,000 a month).

He states, “We’ve taken a systematic approach to outreach,” which includes targeting writers based on three criteria:

  1. They’re writers whose work Gabrielson admires
  2. They’ve written about stories that similar to Oliver Cabell’s or have authored articles that are in the same niche (e.g. menswear, fashion, retail, etc.)
  3. They cover broader business-based trends (such as entrepreneurship and innovation) and may seem interested in the company’s story (which includes editors who don’t typically write about fashion)

Oliver Cabell has been especially popular with writers in the latter category, thanks to its “David versus Goliath” style story where the brand aims to disrupt high-end fashion with its direct-to-consumer model and transparent pricing.

Gabrielson also employs technology—automation software, follow-up tools and reminders—to manage all of his warm media relationships. For instance, he uses MailButler to deliver email pitches and follow-ups at opportune times when open rates are historically high, along with a later note-to-self if the recipient doesn’t respond.

Countless customer referrals

When it comes to purchasing product, Gabrielson believes there are three primary considerations:

  1. Design. If the customer is attracted to the product, they’ll purchase it.
  2. Price. If the product meets the buyer’s budgetary limitations they’ll surely own it.
  3. Social factors and attitude. This, according to Gabrielson, is a brand play which relies heavily on a company’s ability to craft and tell a compelling narrative and demonstrate likable values.

Though a vast majority complete purchasing decisions based solely on design and price, consumers are increasingly drawn to products that have a significant social impact and to businesses that share the same values.

In an interview with Inc. contributor Kenny Kline, Gabrielson explains,

“Because we’re such a new brand, consumers can’t rely on our reputation [to make their purchasing decisions]. Our transparency is how we prove ourselves. By opening our doors from a production standpoint and a price standpoint, it allows us to prove to our consumers that we can substantiate the claim of being a high-quality product.”

And, due to Oliver Cabell’s minimalist design, affordable pricing, and strong business ethics, the company’s customers and fans have been generously vocal evangelists who refer their acquaintances, friends, and family members.

Gabrielson proudly says,

“I started Oliver Cabell with the lofty goal of creating an honest alternative. By being online only, partnering directly with our factories in Italy, and bypassing traditional markups, we’re able to provide higher quality goods at a fraction of the price. We also believe that everyone deserves to know the story behind the goods they buy, so we reveal it all, including what it costs to make them.”

Also, one secret to the startup’s success was its pre-launch referral marketing campaign. Before Oliver Cabell’s luxury backpacks and weekender bags went on sale, Gabrielson set up a landing page that prompted consumers to offer their email in exchange for access to Oliver Cabell’s online store ahead of its scheduled launch date. Subscribers were also encouraged to refer their friends; referral rewards included sneak previews of the company’s first batch of products and some very active advocates even earned a free bag.

The signup page went viral and, before Oliver Cabell formally promoted its first product, it had already amassed a list of 10,000 interested customers.

When grooming company, Harry’s, was planning to launch, it had feared the news might fall on deaf ears. And so the team decided to initiate a similar pre-launch referral marketing campaign, which turned out to be a huge success; Harry’s collected 90,000 real emails from shoppers who were excited about getting a better shave.

How Oliver Cabell plans to grow and what other ecommerce entrepreneurs can learn too

To grow the business further, Oliver Cabell recently introduced its Arcata travel kit. And the company expects to consistently ship new products moving forward, allowing Gabrielson to increase his average customer lifetime value, as shoppers return to his online store and buy every new item on the virtual shelf.

In recent months, Oliver Cabell has also partnered with like-minded retail startups such as AYR, Need Supply Co., and The Arrivals to exchange customers and share marketing resources. Moving forward, Gabrielson expects to launch a few product collaborations too.

Wrap up

So what can other founders learn from the Oliver Cabell story? Well, despite having limited access to capital, Gabrielson has been incredibly scrappy and strategic with his resources. And he has cleverly leveraged relationships (in manufacturing, media, and marketing) to lay the foundation for what could easily be a very successful business.

Other ecommerce shop owners can look to Oliver Cabell’s success to see how a strong vision compared with a strategic marketing plan and some old-fashioned legwork can pave the path for a successful brand that customers can’t stop talking about.

Lastly, for aspiring and current ecommerce entrepreneurs, consider this food for thought: When Yahoo! Style asked the first-time founder, “If you could offer just one piece of advice for someone looking to start their own fashion company, what would it be?”

Gabrielson answered, “Ask yourself what value your company and product provides to consumers. If your product isn’t enriching lives in some way, you’re going to have a tough time surviving in this ultra-competitive market.”

The post The Unlikely Path to Growth: Oliver Cabell’s Ecommerce Startup Journey appeared first on Campaign Monitor.

Why You Should Bootstrap Your Ecommerce Business: Tales From A Battle-Tested Founder

In 2009, Michael Salguero and his co-founder Seth Rosen inked a deal to buy the website CustomMade.com for a whopping $150,000. For a business that hadn’t even launched yet.

CustomMade was one of many fledgling ecommerce startups looking to upend traditional retail and capitalize on what the industry believed to be consumers’ inherent need for individualization. In 2009, custom t-shirt company Spreadshirt earned approximately $30 million in revenue. NikeID sold $100 million worth of shoes that year too.

Without the full cash on hand, Salguero and Rosen negotiated terms that allowed them to put a modest deposit towards the purchase while they scrambled to source funding from investors to finance the website acquisition and launch their business.

They eventually raised $400,000 in seed capital to start CustomMade, a marketplace where shoppers could connect with woodworkers to handcraft one-of-a-kind household items such as tables, desks, cabinets, and shelves.

And, with the belief that CustomMade had brilliantly pioneered the future of furniture retail, investors from firms such as Google Ventures, Atlas Venture, First Round Capital, and NextView Ventures offered CustomMade $27 million over several rounds of funding.

However, the team behind CustomMade always knew that “raising money” was not synonymous with “success.”

The limitations of $27 million in funding

One of the major assets of the CustomMade.com acquisition was the website’s long history of dominating Google’s search engine rankings for keywords related to custom furniture, which the team harnessed and nurtured.

“CustomMade’s growth strategy was driven almost exclusively through SEO. It was a killer domain that was initially focused only on custom woodworking, and we expanded that into other crafts,” recalls Salguero. “By 2014, it ranked as the #1 search term for almost anything custom. There was a high volume of traffic and our efforts were centered around how we could convert those people into CustomMade customers.”

At one point, the domain generated one million visitors each month with three-fourths of that traffic coming purely through organic search. Despite all of those views, converting their audience into active—and paying—marketplace users was a challenge.

Among traditional ecommerce businesses, the sales conversion funnel is straightforward:

  • Visit the online store
  • Browse products
  • Add desired items to cart
  • Checkout

However, with CustomMade, the buying process was more cumbersome and less predictable:

  • First, shoppers have to describe the exact item they want made (a step that can include creating your own 3D model).
  • Second, you receive quotes from multiple makers (who you’ll have to personally vet).
  • Finally, after selecting one craftsman to work with, you have to wait however long it takes for that person to fulfill the order (and that uncertainty alone can be detrimental to conversions).

With $27 million from investors who were expecting dramatic growth, the obvious action for CustomMade was to pour cash into potential solutions to its conversion problem. For the business to work, one of two things had to happen:

  1. CustomMade had to further streamline the beginning-to-end buying process so that shopping in the marketplace felt as easy as buying sneakers from Zappos.
  2. CustomMade had to fundamentally change consumers’ behavior to want to completely design their products from scratch using sketches, 3D models, and the help of skilled craftsman.

But the business could never quite figure out how to do either.

By 2015, the company made the difficult decision to downsize, shedding nearly 20 of its 30 staffers. Around that same time, Salguero transitioned out of his day-to-day role at CustomMade with ambitions to build a completely different ecommerce business. This time, with his own money, on his own terms, and in a lean and bootstrapped manner to avoid the typical trappings of venture capital.

A calculated bet on the subscription-based business model

One of the toughest, yet most important metrics to grow among traditional ecommerce companies is customer lifetime value (CLV).

In transactional ecommerce, store owners have to make it their mission to persistently follow up with customers to encourage repeat purchases. This is even true when shoppers know they need a certain product; however, it’s common that buyers can’t find the time to place another order or they simply forget.

In an age where customers demand convenience, subscription-based businesses remove most of the friction that can deter repeat purchases. So, when Salguero decided he’d start a new company, he aimed to offer a product consumers wanted on a regular basis in order to generate consistent and recurring revenue.

Traditional ecommerce companies assume a majority of their customers will only purchase their products once unless they’re successful in hounding them every 30 days to reorder. By default, though, subscription-based businesses get new customers to commit to monthly packages, which means their average CLV is 12 times higher than other ecommerce stores.

From this mindset, ButcherBox was born. Salguero envisioned a monthly delivery service that would provide customers with grass-fed beef, organic and free-range chicken, and heritage breed pork. This was partly driven by Salguero’s personal desire to gain easy and regular access to quality meat.

ButcherBox’s subscription-style business follows the examples of popular brands like Blue Apron, a meal delivery service rumored to IPO at $3 billion next year, and Dollar Shave Club, a subscription service for men’s grooming products that was just acquired by Unilever for $1 billion. But, rather than pursue venture capital the same way he had with CustomMade, Salguero has so far decided to grow independently. After speaking with Salguero about his new company, Xconomy reporter Gregory T. Huang wrote:

And it speaks to a key lesson he learned from his previous company: Keep things tight and focused. At CustomMade, he says, “We raised a lot of money. At the time, we thought it was good, and we could turn the corner. But you start making decisions you wouldn’t otherwise.” He adds, “You end up doing so much stuff that’s not mission critical. We grew and got product-market fit, but not mass-market fit.”

So the goal with ButcherBox is to see if the team can get traction with the right product. They’re not looking for a mass market, just a dedicated one. And they’re not raising venture capital—at least, not yet.

And, so far, the bet Salguero made on himself has paid off.

Kickstarting ButcherBox with $210,000 from customers

Before he would officially introduce ButcherBox to the world, Salguero first wanted to validate demand for his product. Therefore, he created a Kickstarter campaign with the modest goal of raising $25,000, a sum he believed would be just enough to finance early operations.

But, to his surprise, the project received $210,000 worth of pledges, exceeding his funding goal more than seven times over.

How did he do it?

Salguero’s promotion strategy for the business was threefold:

  1. Facebook Advertising. “Prior to launching on Kickstarter, we advertised on Facebook, which helped drive email signups.” When ButcherBox’s Kickstarter campaign went live, Salguero already had a long list of interested customers who were ready to commit to the project. Additionally, because he’d already tested different advertising copy and images, he had winning formulas for creative assets he could use for further paid promotion campaigns.
  2. Linkedin Connections. “We also used LinkedIn, which allows you to scrub your contacts, and we tapped our family and friends network to provide a base of support.” With enough early pledges, ButcherBox was highlighted as a trending project on Kickstarter. Then, ButcherBox’s popularity caught the eye of Kickstarter employees and was featured as a “Staff Pick,” which meant the campaign received favorable promotion across the Kickstarter platform and on the company’s newsletter to backers.
  3. Co-Marketing. “There were co-promotions we worked on with other companies in parallel spaces and influencers who drove interest from their networks, which both proved successful and have been a valuable tool to this day.” Salguero knew that his team alone didn’t have the marketing manpower to make this crowdfunding campaign a breakout success. So he leveraged the audience and influence others already had to drive targeted awareness to and interest in ButcherBox.

Now ButcherBox is four years old, and the business has continued to grow rapidly since its inaugural Kickstarter campaign. Salguero discloses that the company, which offers boxes starting at $129 per month, has thousands of subscribers.

Best of all? “We’re profitable,” says Salguero.

Finding profitable and scalable marketing channels

Thinking back to his time at CustomMade, Salguero laments that he and his team were unable to solve the conversion funnel conundrum. To some extent, CustomMade users were paralyzed by the paradox of choice—when your purchase options are limitless, it can seem intimidating to decide on any one particular design. But, at ButcherBox, the customer journey is a lot clearer, which means marketing the business is a lot simpler and far more scalable.

Also, in contrast to his experience at CustomMade, Salguero now has a far more constricted budget for marketing ButcherBox. “We do not pursue any marketing campaigns unless we know they will be profitable in month one,” explains Salguero. Instead of making a big splash with a major round of funding from investors and aggressive six- or seven-figure advertising campaigns, Salguero claims, “Now we’re trying to just quietly build a smart business.”

And one of ButcherBox’s biggest revenue drivers is its pay-for-performance affiliate program, in which it partners with category influencers—fitness, health and wellness, and cooking bloggers—to promote its product. With this arrangement, affiliates receive a commission based on customers they refer to ButcherBox and ButcherBox avoids any upfront costs, ensuring that every affiliate relationship is profitable.

As the company grows, Salguero anticipates partnerships with like-minded brands to be their next big marketing channel. The hope here is that, perhaps one day, a major brand like Equinox might order a box for each of its gym members. Or Nike might hand out flyers on ButcherBox’s behalf at its training events. Even a small endorsement from a large fitness- or health-related company would be a huge boost for the ButcherBox brand.

Wrap up

Based on the stories of CustomMade and ButcherBox, ecommerce marketers can learn three important things from Salguero’s experience growing two very different ecommerce companies:

  1. Your definition of success may be different than other entrepreneurs. As a product of the Boston tech scene, Salguero had dreamt of turning CustomMade into a startup unicorn (a rarified private company worth an excess of $1 billion). But, after raising $27 million and living every new entrepreneur’s dream, he recognized that startup founders feel a lot of undue pressure to build a business that sets them—and their investors—up to have a massive exit (in other words, an acquisition or an initial public offering).
  2. Organic growth is the key to a sustainable business. Now Salguero champions growing a company organically, at a rate that feels natural to both the entrepreneur and the brand. The chances are you’ll have more fun doing it this way and you’ll be better equipped to develop a sustainable and long-lasting business.
  3. Reduce friction in the buying process. Also, after recognizing the relative ease at which he has grown ButcherBox, Salguero knows that success in ecommerce is only possible when built upon the foundation of a streamlined conversion funnel. Avoid, at all costs, convoluted purchasing processes that force customers to abandon any hopes they had of placing an order with you.

Are you an ecommerce marketer? We’d love to hear about your experience bootstrapping your business and what you’ve learned in the process of growing a brand online.

The post Why You Should Bootstrap Your Ecommerce Business: Tales From A Battle-Tested Founder appeared first on Campaign Monitor.

Premium Pricing: Why Customers Pay 10x More For YETI’s Coolers

When YETI launched in 2005, brothers Roy and Ryan Seiders had an unfathomable idea: to sell a $300 camping cooler, when nearly all the other coolers on the market sold for under $30.

Unlike most entrepreneurs who seek to disrupt an industry by solving industry inefficiencies and then selling their wares at significantly lower prices, the Seiders developed what they believed to be the perfect portable cooler that just happened to cost an order of magnitude more than traditional coolers. According to YETI CEO Matt Reintjes,

We didn’t set out to make a product that cost ten times as much as ordinary coolers. We just wanted something that wouldn’t break. So we set out to build the best cooler we could make, with the best materials, construction, and manufacturing processes, without any compromises.

And it was this commitment to quality that’s helped the organization carve out a new market for premium-priced coolers. Reintjes adds,

We knew there were other people out there that were sick of their gear breaking and would be willing to pay more for a product that could last and significantly outperform their expectations. It turned out there were a lot more people sick of failing gear than we could imagine.

By 2007, the business had cleared $1 million in sales. In 2009, YETI sold $5 million worth of product. Revenue kept multiplying as the company began partnering with increasingly large brick-and-mortar retailers like Ace Hardware, DICK’S Sporting Goods, REI, and even Walmart.

YETI’s sales soared to $29 million in 2011, and then $147 million in 2014. In 2017, YETI’s overall revenues climbed to $639.2 million, about 10% of which YETI sells through its website.

So how did YETI, over the better part of a decade, manage to grow its business to nearly half a billion dollars in sales, with $64 million driven through ecommerce?

To sell a premium product, calculate its value.

Business experts would normally agree that convincing consumers to switch from paying $30 for a cooler to spending $300 is a fool’s errand.

In 2005, when YETI was first introduced to the market, this was unprecedented. However, the hard-to-swallow cost of the uber-premium product was easy to justify when shoppers calculated its long-term value.

 

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Limited edition Seafoam Tundras are now available. Click the link in our profile to get yours. #BuiltForTheWild

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Reintjes explains,

There are a lot of cheap, essentially disposable, products in the world that consumers repurchase every time they have a need. Consumers pay a price each time they have to replace those products, and if you add them all up compared to one YETI product that is built to last, the YETI value equation starts to make a lot of sense.

Today, the company’s most expensive cooler, the Tundra 350, sells for $1,299.99. For the biggest outdoors enthusiasts, $1,300 on a single piece of equipment can feel like a bargain when used over dozens of outdoor activities each year, every year.

And, as consumers’ appetites for luxury coolers grew, so did the competition. The Grizzly 40 Quart Ice Chest, the Igloo Yukon 50 Quart Cold Locker, the ORCA 40 Quart Cooler, and the Pelican ProGear Elite 35 Quart Cooler all sell between $246-$326 on Amazon.

What’s impressive about the YETI story is that, in addition to getting consumers to adapt to paying 10 times what they were used to for a cooler, YETI has also been able to successfully cross-sell and upsell its loyal customers who spend even more on some of the brand’s premium-priced accessories, like the Rambler 20 oz. Tumbler, which costs $29.99, has thousands of positive customer reviews, and has an average rating of 4.8 out of 5 stars.

Though far cheaper alternatives can be found on Amazon for under $10, many shoppers still prefer to support the YETI brand. Reintjes knows,

Once people have bought and used a YETI product for a while, they understand the high level of performance and durability built into everything we make. As we’ve expanded from hard coolers and applied our same product innovation approach to other categories like soft coolers, travel cups, water bottles, insulated can holders, and (soon) jugs, people who have experienced YETI performance in one product are usually the first people to jump on board with our latest and greatest.

For many customers, YETI coolers have even become something of a status symbol, given their luxury price tag and durable features. In fact, last year a report by The Wall Street Journal found that thieves have been targeting YETI products, snatching them from beachgoers, campers, and grocery stores.

Marketing YETI with the help of influencers

To build a brand so highly coveted that its products attract burglars, YETI leveraged the help of influencers. In an article for The American Genius, business writer Connor Wrenn writes,

From the beginning, YETI has marketed the cooler to people like the founders; passionate and respected outdoorsmen whose passions drove them to own the latest and greatest gear. To do this, they hired influential guides and fisherman as brand ambassadors. They also sponsored programming on hunting and fishing TV stations. All of these early efforts earned the trust and recommendation of “influencers” and ‘prosumers.

‘Those commercials didn’t reach millions of people, but the people that they did reach were the most serious hunters and fishermen,” YETI vice president of marketing Corey Maynard said. “So it would reach 100,000 or so hardcore hunters and fishermen who would be the person within their circle of friends who their buddies would ask about the latest gear.’

Indeed, with endorsements from big-game hunter, Jeff Simpson, big-wave surfer, Shane Dorian, and two-time world champion bull rider, JB Mauney, YETI easily appeals to the avid adventurer.

Of course, building influencer relationships and earning their brand support took time. The strategy that YETI has employed to create and scale its influencer program, according to CEO, Reintjes, is a process more than the spontaneous thought followed by action of “we like him/her, so let’s go sign them.”

The ambassadors YETI engages are “people we identify that we think would be a good, authentic brand fit.” Fledgling ecommerce companies should keep this in mind too because plenty of people have an audience, but misalignment between brand and endorser values can backfire.

Many overly eager businesses have been the subject of ridicule when they’ve partnered with the wrong celebrity. For example, Bootea’s regretful partnership with Scott Disick when the reality star copied-and-pasted instructions for his paid endorsement into the caption of his Instagram post.

For a company to sustainably grow, influencer relationships need to make sense for both the brand and the endorser’s audience.

Reintjes says one of the best ways YETI sources new brand ambassadors is through referrals from existing ambassadors. He notes, “Usually there’s a ‘getting to know each other’ period, and once we both feel good about a true authentic alignment, [a formal endorsement] offer will follow.” Reintjes also cautions,

The success of influencer marketing is more complex than just deciding how many partners to have. The brand first needs to understand their need for influencer marketing. Is it an awareness play or is it an authenticity play? If it’s gaining awareness, then you need to look at the outlets that the individual brings to the table, the geography on where you want to build that awareness and then build a plan around basic impressions. If it’s an authenticity play, then it needs to be a natural a brand fit.

The quantity isn’t nearly as important as the quality and, once you have an individual that you’ve partnered with, you can start to understand the outlets to your consumer base and their follower base and build a strategy and tactics to introduce the partnership. I believe the biggest mistake smaller companies make when entering the ‘endorsement marketing’ playing field is they look for people that have big social networks or can get them quick hits. This is a long-term play. We sign our Ambassadors for their expertise and authenticity in their specific pursuit. A couple of our ambassadors don’t even have social networks.

Authenticity is not only important when developing influencer partnerships, but it’s also something important brands need to demonstrate to their customers too, through their own social messaging, product packaging, customer service interactions, and advertising campaigns.

Organically interesting brands can attract A-list endorsements. Reintjes believes the best way you can get an influencer to promote your business (and not a competitor’s) is by manufacturing a product worth buying.

“I think it starts with the product. You have to have a product that fits into a gap that the individual needs to fill. If you have that product, it makes the alignment real. We’re lucky that YETI fills a need in many different ways in these individuals’ worlds.”

Once you have a product that’s ready for promotion, ecommerce marketers can search for and filter through marketplaces filled with sponsor-friendly influencers. These include:

Wrap up

A highly cited study by Nielsen suggests peer recommendations are the most credible form of advertising. So endorsements from YETI’s ambassadors to consumers, as well as the clear value a durable and high-tech cooler offers compared to the more “replaceable” alternatives, made a seemingly impossible challenge look easy.

Ecommerce brands often mistakenly believe their marketing needs to be opportunistic in that, wherever they can attract an audience, they should. However, marketers should focus on campaigns and channels that actually convert customers instead of inbounding tire kickers. Furthermore, rather than lower prices to compel shoppers to complete a purchase, many stores should proudly display their products’ advanced features to help buyers justify their premium price tag.

Selling a high-priced product online can be challenging to start, but once you explain your value proposition to customers and garner the support of category influencers, you too may be able to create a cult-like following for your brand and products. Email is the perfect tool to explain your value prop and build your following. Get started with intuitively powerful ecommerce email marketing today.

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