Lara Schmoisman 0:05
This is Coffee N5. I’m your host Lara Schmoisman. Hello, everyone. Welcome back to Coffee N5. And I was actually talking before this podcast and the challenges of many of the brands that they work with us. We were talking about that, beyond all the efforts that we can do on marketing, social media, it’s still important to have products on shelves to differentiate the difference. I mean, it’s redundant to understand the difference between marketing and sales. And those two, they collaborate with each other, but they’re not the same. So today, I brought Patricia, and Patricia, you want to introduce yourself? And I mean, she’s an expert in the beauty industry. She’s been doing this for a long, long time. And she’s not only helping brands to create the beauty brands, she’s also helping companies to lead them and to understand what it takes to be on a shelf, and to be a consumer product or a beauty product and be purchased by retailers. So welcome, Patricia,
Patricia Valera 1:26
Thank you so much for having me. My name is Patricia, the owner, beauty brandr and we are a strategic advisory firm, and I work with entrepreneurs, beauty founders and helping them create, scale or expand their beauty brands, domestically and internationally. So I’m very excited to be here joining you in this conversation, which will be very, very interesting.
Lara Schmoisman 1:51
I’m sure it will be because let’s talk about because of course I can tell you the notions of every person who comes to me they think they know marketing. They think that they know how to do Instagram because they have access to a phone. And they’re not taking in consideration algorithms, design engagement, so many other things that we need to take in moderation. And I’m sure that for a new brand that they created, you see all those errors that they’re making, at the time of launching the product. To me, the first error that I can see is people not doing the research and finding who their competition is, and refining how unique they are. And who they are going to be featuring your core beliefs or attributes that makes you different from your competition.
Patricia Valera 2:49
Exactly. And that’s anytime I work with any of my clients, the first month is really digging into that specifically, especially for the new ones, or the ones who’ve been around for maybe a couple of years. And they kind of just wonder why they’re not making any revenue. So really understanding what sets you apart. And knowing really who your customers are, before you even get into what product are you selling? So because it’s great to have a good product idea. But do you know who it is? Who is it that needs that product? So there’s a you know, a lot of times they don’t think deep enough and understand who that is? And then you understand your competition based off of that, like, who else is that person shopping for?
Lara Schmoisman 3:40
you need to make sure of this, sometimes you desire to go to a certain audience, but it’s not the real audience for your product.
Patricia Valera 3:49
exactly. So that’s why it’s important to really understand who isn’t your target, you know, you can either if you have to start with a product, then you need to figure out who that product is for. But if you start with your audience thinking about them first, it’s almost easier because you can really identify what their pain points are and then develop a product out.
Lara Schmoisman 4:15
Where is that gap? Where is that hole?
Patricia Valera 4:18
That’s exactly, exactly because if you’re starting and 90% of the people I work with start with the product idea first. So it’s almost harder to build to explain the need from the product versus when you’re explaining what that person views. And then depending on where that person shops, then you get a really clear understanding who your competitors are and then it becomes really easy to figure that out. You know, you just literally walk into alternative support and see, you know, who’s who was it then you will be sitting next to?
Lara Schmoisman 4:50
Yeah, exactly. And also, I mean, there is so much opportunity if you find that little gap because you’re not gonna find big gaps. Or is the market today so saturated that you really need to go or you have a huge budget that can really promote your product. Or you need to find that need and satisfy it.
Patricia Valera 5:15
Right. So niching down is critical. So another thing that I talked about is finding 10,000 people, you’re not aiming for a million, this is not the goal. A million people is 10,000. And you know, a really easy exercise is to think about what your price point is. So let’s say your product is $25, on average, multiply that by 10,000. That’s, you know, a couple million dollars. Well, I’m ready, I think it’s easier to find, yeah,
Lara Schmoisman 5:53
They have big eyes right? They want to have a million followers. But I always said, I prefer to have 1000 followers that buy your product, engage with you that have millions, and you’re gonna have, it’s gonna look weird. Because if you have millions, and you don’t have that engagement, their algorithm is not going to cooperate with you.
Patricia Valera 6:18
Exactly. And I especially like with emails and things like that I tell my clients, you know, if people if after like a year or two, they’re not opening your emails, let them go. And if people are not engaging in your social media, you’re not, there’s something you’re not talking to them in the right way. You’re not giving them good, good content. And a lot of the content that’s out there, you’re just kind of repeating the same thing everybody else is doing.
Lara Schmoisman 6:48
Another mistake that I found that people are trying to replicate other people’s success,
Patricia Valera 6:54
right? And because they haven’t figured out what works for them, exactly and everything, it’s all created versus curated. And it’s, it’s planned versus spontaneous. And I always think you have to have a mix of both. And in the beginning, one other thing that I wanted to do when you mentioned the topic of conversation is really understanding marketing, a big pet peeve of mine over the last 10 years. So I started in the industry. Back when I was a baby when there was no social media, like none. There was Myspace, that was it. So when we talked about what I learned, the marketing that I learned is more traditional marketing. So everything, not including social media. And over the course of the last 10 years or so, when people say marketing, all they think of is social media. And I’m like, no, no, there’s a whole other world of things that you can do, absolutely don’t involve Instagram, and Facebook.
Lara Schmoisman 7:55
That’s what I always say to all my clients. I mean, this is an omni-channel world, you can not put all your eggs in one basket. because something happened. I mean, you don’t own Instagram, or your Facebook account. So something happened to those accounts or you’re gone. So you need to put your efforts in different places. And at the end of the day, the only thing that you’re going to be owning is your website and your content.
Patricia Valera 8:23
Right, and even then Amazon goes down. So you have to have a presence in multiple areas.
Lara Schmoisman 8:29
Depends how you do it. But if you have a website, no, I’m not talking about square as far as being a Shopify or or I mean, I’m talking about real websites, that real website, and it’s yours. And, again, to me using those platforms is a big mistake for a company.
Patricia Valera 8:48
Interesting. So you would you would build it on a server, from scratch
Lara Schmoisman 8:54
or WordPress, on any open source that it belongs to you. You’re not depending on Shopify that you don’t pay them a monthly fee, and that you have a fee. I have a lot of clients that use Shopify, and it works for them. But I believe that as you grow, it’s going to stop working for you. And also, because of all those templates and all those plugins, that is a plugin for this plugin for that, first of all, make your website slower. And second is that so many plugins can create conflicts. And at some point those plugins need to be updated. So if Shopify apply updates their platform, but they don’t take the plug in, you’re going to have conflicts
Patricia Valera 9:39
then you have problems, right, the way I’ve been working with most when those clients that I have are starting small, I’ll have them start on Shopify, or SquareSpace are one of those more established because it’s easier for them to get started. And a lot of them have a bit of a learning curve or budgetary constraints on hiring somebody to compete with scratch, but then once they get some traction and they get some revenue coming in, then we migrate them into something more custom.
Lara Schmoisman 10:07
Yeah, my recommendation is even always starting WordPress. Yeah. Even if you have a small budget, or you can do it yourself, you’re going to be in a better place and using a closed platform, because then you cannot. Yeah. And anyway, so let’s keep talking about bringing brands to the market. Because it’s great to do all the marketing, everything is beautiful and a great widow. But also, there’s a very important skill that is never sharing and trying to get your product in, in big markets. How do you do that? How do you get started to get your product now?
Patricia Valera 10:58
Well, I think it’s all about building relationships. So really getting to putting yourself as a founder in front of the people who have those connections, and building those relationships. I’m a big fan of meeting people like yourself during mastermind groups where you can introduce yourself to other amazing people who may have connections. Following LinkedIn, I live on LinkedIn. So I’ve been raving about LinkedIn for a long time. It is a way people, people who are on LinkedIn are not worried about, you know, what they did yesterday, what’s you know, what? What’s looking cute, you know, the distractions from Facebook and Instagram are not there, people are looking for business, and you can connect with people from a business perspective, one on one. And it’s very easy to start conversations through LinkedIn. So really, building those relationships, going to the publications, seeing the beauty editors that you admire are and going to connect with them. Going to trade shows, once you build those relationships, and people understand what your brand story is, who you are, how serious you are, then they can connect with your brand on another level, and then you could have a conversation on how to enter into their retailers, or that might actually get you featured on their publication, which will then you know, then buyers from the retailers are in a portable feedback.
Lara Schmoisman 12:32
Um, but I mean, that takes time. And patience.
Patricia Valera 12:36
it does. So alternatively, you’re working with, you know, you can work with retail brokers, you know, you can join platforms, like fair or range me. And that’s probably the shortest, the quickest way to get in front of people is going to be through trade shows exhibiting at trade shows, because that’s where the buyers really come to see what’s new, and who’s putting themselves out who’s ready to be perfect. Well, that’s my approach, right?
Lara Schmoisman 13:08
Yeah. And let me ask you a question, since someone comes to you, for example, or has a new brand, how long hours take them to have a product and have it on the market?
Patricia Valera 13:20
It really depends. So I’ve worked with clients but I have someone now who I’m working with who was able to get into some significant retailers within six months of launching. Others have struggled, you know, three years and it just really depends what the retailer is looking for. And again, if you start if you put yourself in a place where they can see you before you even pitch to them, and you start again, going back to just building those relationships, and it puts you in a better position. Because if you only live on Instagram and Facebook, no one is going to find you there.
Lara Schmoisman 14:07
Okay, so how do you get your product and your brand ready to pitch it? What do you have to have you have to have of course we already talked about everyone is the first thing that they do they have their social media. But what else so you have to have flyers booklets? How do you approach someone? What kind of materials do you have to have a deck for presentations?
Patricia Valera 14:33
Decking is very important. But beginning with the product itself. Is your product retail ready? Number one, so there’s a label formatted correctly. Have you done all of the testing on the product itself to ensure that once it makes sense, you know if it’s been sitting in a warehouse for six months it is not going to go bad? You know, I’ve worked with brands where it’s been. It’s gone into Sephora and the product has been turning colors Ensuring that you do your proper stability. So beginning from the basics, that’s really where you start and beginning with making sure that you have a product that can actually stand out on a shelf that has those basics are covered, you know, is your product actually going to stand out on the shelf? And then from there, once those basics are done, then you have to put together your, your pitch deck or retail pitch deck, which is different from an investor pitch deck, I get this question a lot as well.
Lara Schmoisman 15:30
How is it different from investor pitch?
Patricia Valera 15:34
a retail pitch deck, you’re more focused on marketing, and how it is and you have to customize it for the retailer. You know, how does your product align to the retailer’s goals? How does it align to their customer base? And what is your marketing plan to support it? Because even though like they your product is going to alter, you need to do your research to ensure that you’re pitching a product that is aligns with who it is that oppa is either onboarding, at that time with based on they’re looking to fill a gap in their own shopping, you know, in their own market? And what other potential customers can you bring to them that they might not already have? And do they align with their philosophy and their shopping? Once you do that, even if you go into all tech, not like your jobs, not you still it’s still your job to promote your brand. And to bring people on site as well. So they’re shopping for their marketing to their own customer base, but they want to ensure that you’re still promoting your brand. So it’s a collaborative marketing effort. outline that in your retail pitch,
Lara Schmoisman 16:50
That’s super important for people to understand, you cannot have one without the other, you always need to have your marketing plan in place, even if it means that you’re going to sell a product and a higher price point that the retailer will sell it many times. That’s a business plan. And it makes sense because a retailer is going to be selling, buying so much from you in theory. But also, let’s talk about fees, because selling your product means that to retail means that you’re going to have to have a wholesale price.
Patricia Valera 17:25
Right. So again, part of that, that basic setup and preparation that you need to make is ensuring that your margin will allow you to even sell your product at wholesale or add distribution. So my magic number is for wherever your lowest discount is, or for your add whichever level you’re giving a larger discount, make sure that your cost of goods are no higher than 30%. So that will help ensure that every other level is above that. So if you’re going into distribution and your cost of goods are at 30%, then you know that hopefully you’re going to be fine and direct, you’re going to be fine. But if you’re not there, it’s going to eat in your profitability. And it’s going to hinder you and offer any kind of emotions or just count outside of where you’re going to be retailing.
Lara Schmoisman 18:32
That totally makes sense. But also I mean, people need to understand that the money is not going to go immediately to your pocket. Right? Take a while because you need to give it back to the company spending marketing spending adds it spent in giveaways giveaways have a budget for that.
Patricia Valera 18:52
So under Yeah, so those are the kinds of things that you would work out in your retail pitch deck. So depending on the retailer, they’ll have different promotional opportunities for you. Some of them will partner with you 5050. Some of it is going to be 100%. And seeing as, you know, do you have a budget for a sampling program, sampling, add support and also another retail as a team, it’s a great way to, you know, to test out your products introduced to their existing customer base. So it’s going to be much slower growth if you don’t have testers and if you don’t have sampling and even also offering trial sizes. So sometimes you know the cost for a trial, you know, a three hours product and you’re selling something that’s 12 ounces, might be about the same but it will help you sell that product in the long run. So budgeting for those things. Budgeting for kits, gifts that
Lara Schmoisman 19:52
Patricia Valera 19:54
For ads for not only online ads, social ads billboards in store promotions. Yeah, catalogs,
Lara Schmoisman 20:05
trying to get Pr. Pr is super important in creating brand awareness.
Patricia Valera 20:11
Right. So on the outside of the retail effort for yourself, PR, I think is one of the I actually, for my clients, I recommend they start with PR versus paid ads. Because PR, if you start with paid ads, the first thing customers gonna do if it’s an unknown brand is to research what someone else said about you, who’s written about you what the buzz is about, if they don’t see anything, then it’s not going to help us sell. So if you start maybe, you know, anywhere from two to four months prior to launching a product, you start building that buzz in PR, you know, teasers of companies come and get the conversation going, then you follow that up, and the paid ads will support it later.
Lara Schmoisman 21:04
Absolutely. 100% agree. Um, okay, let’s talk about this. Because this is a big, big issue with many startups and many brands that want everything for free. They want everything, and it happens, they want to do everything at home, everything done by themselves.
Patricia Valera 21:31
Lara Schmoisman 21:35
That’s, I mean, when you have a brand, it’s make it or break it to me, if you need to get the funding, you need to do it, right, because you only get one shot. Yes, of course, you can always rebrand and try again. But it’s gonna end up costing you more in the long run.
Patricia Valera 21:51
If you’re planning to go big or go home, then 100%. There’s some brands that I’ve worked with that have grown very slowly, you know, and it’s taken them, you know, 510 years to really make a dent in the marketplace. And that is fine. If you want to go grow super slow.
Lara Schmoisman 22:09
As long as you’re clear about that, that’s fine, right?
Patricia Valera 22:14
Right. If you want something to go big within, you know, the first next year or two, when you want that to be, you know, whether it’s your full time job, you want you need, you need to find that funding to find either investors, or, you know, what, whether it’s, I mean, seed investors, venture capital loans, you know, some people will put their, you know, houses, you know, mortgage their house, to be able to just order enough product to be able to sell it at a large scale to make that return.
Lara Schmoisman 22:49
Patricia Valera 22:53
Then for the beauty of the lack of like several years, formulating at home has become this big thing. And everybody wants to, you know, make their product in the kitchen and sell it on and then go to the Sephora, who’s not going to have to hit a threshold. Either the product there’s, most people are not chemists, like this level of real science. Yes, not just mixing, you know, the liability, the liability is huge. The cost, you know, the labor behind that is huge. The equipment is very expensive, you know, and once you hit a threshold of the amount of product that you’re developing, you may only be able to produce 100 units of something in your house per week. But what happens if you get an order for 1000 or 5000? Or 10,000? It’s gonna be very difficult for you to produce that in house. So working with a trusted contract manufacturer is key.
Lara Schmoisman 23:58
Yeah, I see as a path late lately, that people are like, have these great ideas, which is wonderful, but they don’t have a plan. They don’t have a budget. And the people like you or me, we come in, and we can tell them okay, but people still many times want to still do things in their own way.
Patricia Valera 24:20
Yeah, no, I, for people who are stuck in that mentality, it’s going to be difficult to work with them because this is a very, the beauty industry in general is very cash intensive. There’s a lot of money that needs to go into it. Just to get the product made, let alone everything else you could easily spend $100,000 Just on products. So, you know, it all depends on the quantity that you’re starting with and how many SKUs you have, but that doesn’t include PR marketing. Operations overhead like none of it.
Lara Schmoisman 25:00
Yeah, exactly what is what is really, really important if you have a concept and idea is that you do your research and you make a plan, and you decide that if you’re going to be that company that is going to take you 10 years to grow, or you want a boom, because it takes different budget budgets and different strategies. So you need to have a plan and with the right strategy for those goals.
Patricia Valera 25:25
Lara Schmoisman 25:27
So we were talking about the errors that we see of people starting, but how, what’s a way that we can find out or we can give them tools for success with our line? What tools are the tools for success?
Patricia Valera 25:48
Wow. So I mean, there’s doing research, being organized, I’m really gaining an understanding of the numbers. is very important. And I think at a very basic level, being resilient. And having that kind of personality that’s all about solving problems. Okay. I think that, at the most basic level, those are personal tools that we need. Being able to figure things out, solve problems and keep going kind of no matter what before they come in. And then in terms of tools, there are, you know, different things online and places where you can find certain information. But one of the things that I’m looking to kind of fill the gap is there isn’t really one place. online where you can find this is the list of things that I need to build my brand, and have it laid out for you and organized and a step by step fashion. And that’s one of the things that I’m looking to build this year, is take everything that I’ve been doing with clients. And literally step one, do this step two, step three. And you can have, you know, when I give you the worksheets, the software, the tools that do this, don’t do all of that, and lay it out in a way that would be easy to follow. And if you follow the steps, all of those steps in the right order at the right time, with the right people in the right software, then you have a good shot
Lara Schmoisman 27:32
being prepared and ready for success.
Patricia Valera 27:34
Right. But then you need to have all of those other personal skills of being resilient and prepared and, you know, working till two o’clock in the morning, if you have to. And researching and being able to work with other people, it’s another, you know, this industry is all about working with people, and talking to people in building relationships, both with your vendors, your advisors, your team, your customers, it all kind of comes together.
Lara Schmoisman 28:05
Before we go, I want to ask you the same question I asked everyone: we learn from our mistakes. Tell us a story of a mistake you made and that you learned from it?
Patricia Valera 28:18
Oh, my Lord, I’m a mistake. Well, I can say when I first started my consulting business, I made a big mistake when it came to how I organize my business and my pricing. And understanding what what, for me coming from a background in product marketing, it took a bit of a learning curve for me to learn how to run a service based business because it is very different in how it’s marketed and how it’s priced. And so I had to, you know, and even with, you know, my decades of, you know, experience in marketing, it did take a second for me to learn but I think that my biggest lesson was once I realized the mistake that I was making, pausing and it’s okay to hit pause and redo every one that you got wrong. That is completely okay. And I think a lot of entrepreneurs start you know, you go through these moments of whether it’s imposter syndrome or you feel like you’re failing, it’s okay to kind of start over and rethink your plan and pennant. And since I’ve, you know, gone through that, it’s been a lot easier. It’s been a lot smoother. happier
Lara Schmoisman 30:02
I love it. Yeah. Thank you so much for being here. And everyone else how they are. I will see you next week. It was so good to have you here today. See you next time catch you on the flip side. Ciao ciao.