How This Plant-Based Meal Business Found Its Low-Hanging Fruit
by Felix Thea Podcasts May 30, 2017 29 minute read Leave a comment Email Pinterest Facebook Twitter LinkedIn
Some customers require more convincing than others, which usually makes them more expensive to acquire.
That’s why a good place to start for new stores is to focus on those customers who need no convincing at all, who are the easiest to convert: your low-hanging fruit.
In this episode you’ll learn from Monica and Mark Klausner, the husband-and-wife team that created Veestro, gourmet plant-based meals and juices delivered to your door.
Find out how they created customer personas and then used the data to market to their easiest-to-convert customers first.
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“Well, you always go for the low-hanging fruit first. Those people that don’t need a lot of convincing. So marketing to them shouldn’t be too expensive.”
Tune in to learn
How to avoid becoming a me-too companyHow to create personas to improve your messaging and marketingWhat does it mean to go after the lowest hanging fruit customers
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Felix: Today I’m joined by Monica and Mark from Veestro. Veestro provides gourmet plant-based meals and juices delivered to your door, and was started in 2013 and based out of Los Angeles, California.
Welcome Monica and Mark.
Monica: Thank you.
Mark: Thank you.
Monica: Thanks for having us.
Felix: Yeah, excited to have the both of you on. So tell us a little bit more about this business or the service that you run.
Mark: Well, Veestro as you mentioned started in 2013. Started basically out of a need. I used to work in finance and I rarely had time to eat healthy. I usually would get home at 11 or 11 pm or midnight, and most restaurants were closed, delivery wasn’t an option, and so I ended up making really bad choices.
I started looking for different options in the supermarket and I couldn’t find anything that I liked that tasted good, and that had simple ingredients that I could actually read. So when I decided to get out of banking, I was trying to figure out what to do and I saw an opening. I thought this was a really good opportunity for young professionals. I started setting up the business and while I was doing that, I was asking Monica, my sister, a lot of questions because she has a lot of background in marketing and sales while my background is finance and operations.
While talking to her I realized that it wasn’t just for young professionals. This would be great for anybody pretty much. Herself, in her case she was a mother of three. She was a stay at home mom at that moment and she thought it was a great idea and a great opportunity for people like her because she spent most of her day driving her kids around, preparing meals for them, but she rarely had time to prepare anything healthy for herself. So just like me she was making a lot of very bad choices.
Monica: Sorry, I just wanted to give you a little bit of background. We grew up in Costa Rica and we were used to eating all of our meals that were basically made from scratch with lots of fruits and vegetables. When Mark was talking to me about this idea he had, I loved it. I felt like it was the right time, and ultimately we decided that it would be great to be able to give people delicious food that felt like it was made at home, but it was already conveniently prepared. So that was one of the reasons why we’ve been working really hard to make sure that our meals feel like they were cooked at home.
Felix: Mm-hmm (affirmative). Now what did the both of you see in the marketplace? I think Mark, you had mentioned that you recognized that it was a good opportunity, then you brought it to Monica and she recognized it was a good opportunity as well. Did you see anything in the marketplace or hear anything from friends and family that made you feel like this was the service or the business that you wanted to get into?
Mark: Well, I did some research before starting the business. Went to different supermarkets, I went online. At that time there weren’t that many companies delivering online, e-commerce companies that were delivering food online, so our options were very limited.
The supermarket, yeah, there were some healthy options in the frozen food aisle, but in order to be in the supermarket, they’re full of preservatives. And I was looking for something cleaner, something more in line to what we grew up eating back in Costa Rica.
Monica: It’s always great to ask people you know, “Is this … How does this sound? Does this sound like something you would want to buy?” And we did a lot of that. We did a lot of asking questions to people that we knew in LA and people that we knew in New York. We both went to college in Texas, so people we knew in Texas. We knew in our gut, I think we both knew that this type of service was something that everybody would be like, “Oh my god. This is such a great idea.” We just wanted to hear it from other people if you will. So we did a lot of that.
Felix: Now there’s lots of competition out there for not exactly what you guys are doing, I want to get into that in a second, but there’s lots of competition recently about these kind of handcrafted meals delivered straight to your door, but your differentiator, seems to be at least, is that all plant-based. Or at least heavily plant-based. Was that a differentiator that you established from the start?
Mark: Yes. We were trying to figure out how we could make this different number one, and number two, how could we provide the healthiest possible meals that we could come up with. At that time we both read bunch of different books about healthy eating including one called “The China Study”. I don’t know if you’re familiar with it. We were convinced it had a lot of very compelling evidence on why plant-based is the way to go. We were already on our way to becoming plant-based and so we decided that if we’re going to do this healthy, we might as well just do it fully plant-based.
Felix: Yeah, I think a concern that lots of entrepreneurs have when they are trying to figure out what’s the differentiator, or what industry they should be in, is that there’s this fear of niche-ing down, like getting too small, getting too different. Not too different, but differentiating too small where you aren’t serving as great of an audience anymore. So a lot of people tend to go much larger, try to go super broad, and it ends up not working out as well because then you’re not different than what’s out there.
Did you ever have that fear like if we go plant-based or we push this kind of differentiation focusing on plant-based meals that you could run into an issue where the market wasn’t as big as if you had gone more broadly?
Monica: Yes. That is actually something that we dealt with very early on in our business. Mark and I were very convinced. Like we were set on the fact that this was going to be not a fad but a big trend. Just because there were so many things going on in the marketplace. You know for one, the environment is really at risk and we have to find different ways to find more sustainable sources of food. That’s been going on for a long time. But we did hear from so many naysayers who were like, “Oh, you guys are in a micro-niche,” not even a little niche, but a micro-niche.
So what we’ve been working on really hard since the beginning is this. Our experience, when we started transitioning into a plant-based diet with the vegan community was very interesting because we found a lot of vegans who were very exclusive. And a little bit militant if you will who back then, this was four years ago, things have changed a lot, back then if you’re wearing leather shoes, you’re just not a vegan. That kind of a thing.
What we wanted to do was we wanted to encourage everybody to eat more plants. Our goal is not exactly to make everybody on the planet vegan, but our goal is to encourage people to eat more plants, to add more plants to their diet because it’s better for your health, it’s better for the environment, it’s better for the animals. There’s really nothing bad about eating more plants, adding more plants to your diet.
What we have found is that that sort of marketing spin that we’ve given our business since the beginning has served us incredibly well, especially as the plant-based movement has become a lot more mainstream. We have stayed at the forefront of this movement where we’re very inclusive. We want everybody to eat more plants, even if you only eat plants once a day or twice a week. It doesn’t matter. Anything that you do is better for you and for the environment. That’s how we’ve been really differentiating ourselves.
The other thing I wanted to bring up really quickly that was a big differentiator for us early on was when we started the business, the whole meal kit delivery where you get ingredients delivered to your home was starting to become all the rage. For us, it sort of defeated the purpose. First of all, we didn’t want to be a “me too”. But it really defeats the purpose because you’re getting ingredients delivered, that’s great. You didn’t have to go to the market. But you still have to chop it, you have to prep it, you have to cook it, and then you have to clean up afterwards. So it’s a wonderful experience, but when you’re looking for a solution, that’s not necessarily what those meal kits provide. So that’s been a very big differentiator factor for us as well. We’re a solution. Our meals are fully prepared. You just take them out of the freezer and you can heat and eat and love.
Felix: Mm. So it’s not just about … A lot of meal kits are focused on like you’re saying the activity of cooking. This is for people that don’t have the time to cook already so why add more of a problem to their lives? Actually add a solution by having something ready for them already.
Now you mentioned that you’re marketing to of course people that are interested in plant-based meals, but there are I guess different levels of passion. Like you said you mentioned before how there was kind of the quote unquote “militant vegans” that are very serious about every aspect of their lifestyle to make sure that it doesn’t have any impact on animals. And there are people that maybe practice meatless Mondays only once a week like they’re saying, “We’ll abstain from eating meat.” Now do you have to market to these two groups differently because they’re such a wide range of passion, or maybe even a reason for them to want to eat plant-based meals?
Monica: You know, we’ve stayed away from marketing to these groups in a very different way. The way we’ve done that, and I think we’ve sort of covered all groups in general, is we’ve stayed on the path of we’re giving you meals that are healthy and that are plant-based. So we don’t talk about the animals, we don’t talk about any of the political issues. We just focus on our food is 100% plant-based, it’s made with organic ingredients, it’s really delicious, and it’s conveniently fully prepared.
Mark: We knew ahead there’s different messages that we put out there depending on what kind of people they are. For example, when we want to reach vegan, vegans are already convinced that this is the healthiest way to eat. Or vegetarians. So it’s a completely different message. Those are what we call our low hanging fruits. They already know the benefits of a plant-based diet.
Then to carnivores, we send out a different message. We tell them just add a little bit more vegetables to every meal and you’re going to notice a difference in your life. So we do, as far as messaging, we look at who we’re looking at and yeah, everybody gets a different message. Some of them are a little bit harder to reach than others.
Felix: Mm-hmm (affirmative). That makes sense. So what’s your method for understanding how to craft a message for these different types of customers?
Monica: We created early on, and we’re constantly tweaking it, we created personas based on the type of customers that we wanted to reach. So we created a persona for people who are strictly vegan. We created a different persona for people who are vegetarian/vegan. We created a different persona for moms who want to eat healthy and feed their kids and their family healthy food. A totally different persona for young professionals. Especially millennials who are really connected to the fact that what they put in their bodies affects the way they feel. So we have an over-arching marketing message that is very welcoming to everybody in general, but each one of these personas gets a little bit more targeted according to their needs and the cost benefit analysis for each one of them.
Felix: Hmm. Now what’s a, maybe can you give the audience ideally, what is a, for people that don’t know, what’s a persona and how do you go about creating one? What’s your process?
Monica: So a persona is basically like a depiction of a group of target customers. So if you are selling sneakers, your personas are probably going to be on one hand athletes. On the other hand, you know people who exercise for fun. So what you’re trying to do is you’re trying to divide your whole world of customers into more specific groups that are more homogeneous so that you can target them with messages that are relevant to them.
Think about it this way. If we go ahead and say, oh, you know, take our Veestro meals to lunch. Take them to the office for lunch. Well what happens to the stay at home moms who don’t go to an office for lunch? Or what happens to people who live in rural areas who perhaps work from home remotely? We want to make sure that every marketing message caters to the individual group by hitting them with a message that’s going to resonate. That’s what personas do for us.
Felix: Now can you create too many personas, or is there a magic number that you try to keep it at?
Monica: Yes. You can always create too many, which is never a good idea, because then you’re really diluting your message too much. So we’ve created four different personas. Depending on your business, how broad or how niche your business is, you’ll create a few less or a few more. But we found that four happens to be sort of the magic number for Veestro. It really allows us to cover a pretty good, probably about 85% of our customers, and then like I said, we’ve been tweaking our personas since the beginning because the market has changed a lot.
So in the beginning we had to provide messages with a lot of education to consumers who really were not aware or didn’t know much about being vegan. Now we have to provide a lot less education because there’s so much more information in the marketplace. Personas are not something that’s static. It’s something that evolves with your business. We actually are considering adding one more persona just because we have found that we a have a lot of, lot of customers who are purchasing meals for their elderly parents. Up until now we hadn’t targeted them specifically, but it seems to become more and more of a thing that’s happening.
Felix: Mm-hmm (affirmative). Now how do the both of you, or how does the company make sure to stay in touch with the personas?
Monica: Well so far, the best way we have found out is I run customer service and I will get on the phone and answer phone calls. I’m on email. I answer emails. One of us needs to keep their finger on the pulse of what our customers are doing, what are they asking for, what are their issues, what’s happening? So I do a lot of customer service. It’s the best way to find out what’s happening. What are they liking? What are they not liking?
Mark: It’s also good because of the way the business is set up, Monica talks directly to the customers. And whenever we see a problem with our packaging or one of our meals, she immediately tells me and it gets fixed very quickly.
Felix: Yeah. In all the successful entrepreneurs I’ve spoken to, customer service tends to be the last thing that they want to give up because like you’re saying, it’s the best way, sometimes the only way to have your finger on the pulse of your customers and the industry. I think that that makes a lot of sense that that’s the best way for you guys to understand your personas and see how they evolve.
Now one thing, Monica, that you mentioned was that the marketplace has become much more educated now about plant-based meals, plant-based diets. Now how does that change your marketing when your marketplace becomes more educated on the benefits, on the possible options, on basically everything that you had to spend so much time in the early days teaching them about? Now that they know about it, how does that change your marketing?
Monica: It actually makes it a lot easier. Having to educate your customer is really expensive because you have to touch your customers many more times than you would with something that they’re already familiar with. So we find that as the marketplace becomes more flooded with information about plant-based eating, our marketing has changed, and it has become a lot more specific with what our product is.
So we’re no longer needing to teach people the benefits of a plant-based diet. Now we get to talk about how our product fits into their lifestyle, how Veestro meals fit into their everyday life. It’s a lot more fun because now we get to really highlight how delicious our food is. We get to highlight our customer reviews, we get to talk about the convenience of having our food already prepared.
And the other thing that I meant to talk about a little earlier, our food is made fresh but it’s delivered frozen. The reason we did that is also again for convenience, because when you have fresh ingredients in your refrigerator, it’s like you have all this pressure. You have to use them or they’re going to go bad, and when they go bad you have to throw them away. And there’s nothing worse than throwing away good food. Especially good food that you paid a lot of money for.
So we found that by providing our meals frozen, it allows you to not feel that pressure so you can come home and say, “Oh, I don’t really feel like cooking today. Oh I have great Veestro meals in the freezer.” But you can also come home and say, “You know what? I want to cook today.” And you don’t have to worry about eating Veestro meals right away.
Felix: Mm. I like that. So when you have this persona, right now you have the understanding of your customers, on a day to day basis, how do you actually use this persona?
Monica: Well we use our personas when we send out emails, we segment our list based on personas and we deliver messages that are specific to who they are. We don’t do it all the time, because there are certain messages that are pretty wide and widely accepted, and they fit everybody in general. Like when we have a promotion, those fit everybody. But sometimes we have different content messaging that is more appropriate for one persona than others. For us it’s important to be relevant. To stay engaged with our customers. In order to stay engaged with them, we need to provide them information that is important to them and that is relevant to their life.
We use it a lot with emails like I said, we use it a lot in our advertising, in our Facebook targeting. When we do ads for different publications, we highlight different things, like if we put an ad in Veg News, then we don’t need to talk about the fact that our food is plant-based. We talk about the convenience and the deliciousness of it. When we put an ad in a different magazine that’s perhaps a little bit more mainstream, we do have to talk about how our food is plant-based.
So we use our personas to inform all of our marketing on a daily basis and to target consumers more specifically and efficiently.
Felix: Mm. Now did you always start with these personas, because right now you have four personas, and just hear you talk about how you differentiate the marketing and the emails and the ads, four personas means essentially four times the work, right? How did you start? Did you start with four or did you build up from just having one?
Monica: We did not start with four. It took us awhile to get to the personas. When we started the business, the first thing that Mark and I needed to know was, is there a real need in the market for our product? We reached out to our lowest hanging fruit. People who are vegan and who’ve been vegan for a while. So we reached out to a lot of vegan bloggers. We sent them sample packs and we spoke with them. And we wanted to hear what they had to say. These are people who at the time, who lived a plant-based life. We wanted to know if this was something that they found useful, that they cared about, that they didn’t. We needed to know. The response was overwhelmingly positive, which was amazing because as they started writing about our service, we started growing. It provided us with growth that we wouldn’t have known how to get.
So in our first couple of years, we grew really in a very organic, no pun intended of course, in a very organic way, in a very guerilla way. We didn’t have any money to spend on marketing or really any significant money to spend.
Mark: Monica mentioned before how four is the right number because you don’t want to get your message diluted. When we started, we couldn’t do four because we didn’t have enough resources to be able to invest enough in each one of the personas. So initially for us it was very simple. People that already know the benefits of a plant-based diet, and the people that don’t. And as the company kept growing and our resources started growing, then we were able to hone in on exactly who our customers were and we were able to develop those four.
Felix: Mm. So basically I think what you’re getting at too, is that when you’re first starting out, you should go after the customers that are already convinced that they need a solution. Or first they’re convinced that they have a problem, and they’re convinced that they need a solution for it first. Is that right?
Mark: Well, you always go for the low hanging fruit first. Those people who don’t need a lot of convincing so marketing to them shouldn’t be too expensive.
Monica: Mm-hmm (affirmative). And it also gives you momentum.
Mark: And then the rest of them, as Monica said, you have to educate them. You have to give them a lot more information. You have to hit them a few times through different channels. So those are a little more expensive. So definitely, when you’re starting out in business, look for the low hanging fruit first.
Monica: Yeah, and definitely spend time reaching them, because once you have some momentum going with your perfect customers, these are the people who know your product, who are totally onboard, then you can start spending some time and money on the people who you need to educate or the people who you would like to buy your product.
Felix: Mm. Now once you’ve won over the lowest hanging fruit customers, in your case the vegans that already were convinced, that already knew about this particular problem and your solution for it, does their support help you get access to I guess the next level, the next easiest customers to go after? How do you use their support early on to kind of I guess leap into the next group?
Monica: Yeah, our original customers were our biggest fans and our biggest ambassadors, so once they found us and they loved us, they talked. They all talked about it. They talked within their communities, but they also talked to their friends and family who they’d been trying to convince to go vegan for years and years. But now, here’s an easy way to do it. So they were really our biggest referral source. For the first couple of years, we grew mainly on referrals.
Mark: So your people in this type of market, they’re very vocal about their experiences and when they find something they like, they like to talk about it, recommend it to other people, and that’s what happened with us. They started writing tons of reviews, very positive reviews on our website. So that helped us a lot because when people that are not plant-based or they’re not vegan or they’re not vegetarian, visit our website, they can read through hundreds and actually thousands of reviews and see what people think about our meals. Nowadays nobody buys anything unless you know that it’s well reviewed.
Felix: Mm-hmm (affirmative). Makes sense. Now I think, in my opinion, food based businesses are among the hardest to run and probably the hardest to get started because you have perishable inventory, right? You can’t just sit on it and hopefully sell it over the span of a year. You can’t let food sit around for that long. Now when you were first starting out, how did you manage this issue where the inventory was perishable and you needed, [inaudible 00:29:16] customers, as soon as possible to buy?
Mark: In the beginning we would manage it the same way that we’re doing it right now. We work on basically just in time. So we work on a week’s worth of inventory, which means that whatever we’re cooking this week is going to be shipped out next week. Now it’s a lot easier because now we can forecast. But when we first started, it was basically we were just grabbing orders as they came in. We were working kind of like a restaurant.
Monica: This is also a giant testament to Mark’s genius. I would say this behind his back, I would say it to his face, I am just blown away at his ability to forecast and purchase inventory. I mean when I tell you, we don’t have any waste. Also, our chef is pretty amazing. He makes vegetable broth out of parts of the vegetables that we don’t use in the meals. He’s really incredibly resourceful. And we work hard to be a sustainable business. But it’s hard, you’re right. The food businesses are very hard to set up. Logistics are very intense.
Mark: And there’s a lot of moving parts, and when we talk about forecasting it’s not just forecasting food, it’s forecasting all sorts of supplies that are needed in order to get that food into our customers’ homes. In the three and a half, almost four years that we’ve been in business, we’ve never been short of anything and that’s thanks to the systems that we put in place since day one.
Felix: Mm. So managing all of this at the beginning, you found no difference between what it was like at the beginning compared to when you had to scale it up to many, many more customers?
Mark: Of course there were a lot of differences. But the system was set up in the beginning and all we had to do is we had to adapt it as volume kept growing. It actually ended up working in our favor, we used to work out of a very, very small facility with very limited space, so when we first started the business we didn’t get that many orders each week. So whenever I bought inventory we could have, for example when it comes to packaging inventory, I could have a month worth of inventory back then.
But we kept growing, we kept growing. It got to a point where I was buying boxes and I was buying trays and insulation pretty much every week, which is very nerve wracking because you don’t know if everything’s going right one time. And it’s not a good way of managing a business, but it was what we could do because we outgrew our facility very quickly.
Now last year we moved to a much larger facility so we have plenty of space so now we work on about two months worth of inventory when it comes to packaging. But when it comes to food, because it’s perishable, we still work on a week’s worth.
Monica: The other benefit that we had that you forgot to talk about, in the beginning when we were at this really small facility, we were in Thousand Oaks, which is right where there are tons of organic farms. So in our backyard, we have tons of organic farms, and since we work order to order, we could just run down the street and go to the farm and pick up what we needed and then come back to the office. It was definitely a luxury that we did not anticipate when we got that facility, but it really worked to our advantage in the beginning.
Felix: Mm-hmm (affirmative). So that’s a nice surprise for your business. What about obstacles? What obstacles surprised you with starting a business like this where it’s food based and the inventory is perishable and requires so much skill in forecasting?
Monica: Well, we’ve had a lot of interesting hurdles to overcome. The first one early on in the beginning was packaging. We had to figure out how to ship a box full of food with dry ice straight to the customer’s door and get it there in enough time so that the food would arrive frozen. That was actually fine, because Mark had done all these tests on the packaging, and it all worked out great. Except we have to use a shipper. Now we’re depending on a third party to deliver our packages. And you know FedEx is amazing, and really the amount of times that we have issues with them is minimal compared to the amount of orders we ship. But we were dependent on them delivering on time, and every once in a while there would be some sort of weather issue and our packages wouldn’t get there, and our customers would be mad, and we had to address that right away.
Mark: Another obstacle that we had was in terms of the actual packaging. We used to use plastic trays, and every time we shipped, sometimes because of the temperature of the dry ice inside the package, the plastic trays would become very brittle and in some cases they would shatter while they were in transit. So it took us some time.
We looked around, we talked to many different suppliers, and we finally found trays that are made out of carton, which ended up working better for us because they are fully composted. And of course they don’t shatter while in transit. They do have their weaknesses, but overall it’s worked much better and it portrays a better image of the company, an image that we are trying to portray to our clients, which is we are an eco-friendly company.
Monica: Yep. The other hurdle that we actually turned into a big opportunity for us was customer service. So I think we realized early on that we needed to have really amazing customer service. Early on in our business, we talked about the Nordstrom customer service business school case that everybody that goes to business school reads about and studies. Nordstrom has, I’m sure you know this, the most incredible customer service. We decided early on that, yeah, we had issues here and there, and the packaging would shatter and the packages wouldn’t get delivered, but the way that we resolved the issues was much more important than the actual problem.
It gave us an opportunity to build relationships with our customers where they feel like our company isn’t just one of those incognito companies, you don’t know who’s behind it. There’s people behind our company, there’s people who care. That’s why we have our faces on the website, because we want to make sure that your experience with our company is excellent. We want to make sure that every step of the customer’s experience with Veestro is amazing.
Felix: Mm. Makes sense. So can you share a story or an example of how you can go above and beyond in customer service so that you can turn around a problem into an opportunity to connect with your customer?
Monica: Yeah, absolutely. And this happens all the time. A customer will call and say, “You know, one of the packages came open.” One of the packages of X came open. And it happens. Sometimes the drivers are not very careful with our packages even though the boxes say fragile, handle with care. You know, you just don’t know what happens on the journey, and every once in a while the individual meal packages will open. So we always, always give customers a credit that is above and beyond the price that they paid. So we want to compensate them for not only the meal that was opened, but also for the inconvenience of having to throw it away or having to deal with that, having to call, having to email. So we always give customers more than they spent when they have small issues like that.
When they have bigger issues, for example FedEx delivered and it says that it was delivered but the box is nowhere to be found. Perhaps it got stolen, perhaps it was delivered somewhere else. It’s not really the customer’s fault so we always ship them a new box.
Felix: Hmm. Makes sense. Yeah.
Monica: And I’m hesitant to say this on a podcast. I don’t want people to go, “Hey, great. I’ll order Veestro and I’ll call them and tell them that nothing showed up and they’ll send me another package.”
Felix: I think most people are not going to take advantage of that. That’s great thought that you’re able to do that, because a lot of times you don’t want to have a short-sighted approach to your business, right? You don’t want to think about the bottom line of all points because you know I’ll bet in the long term your bottom line is improved because of this kind of customer service, even if you’re operating at a loss for that particular customer at that particular time.
Monica: Absolutely. Absolutely. And you know the amount of goodwill that we’re able to build by going above and beyond, fixing the issue and doing it with a smile and making the customers happy, is amazing. And this is something that every business owner should keep in mind. It is much less expensive to keep a customer than it is to find a new one. So let me say that in a different way. It is much more expensive to get a new customer because you lost a customer than it is to do what it takes to keep that customer happy.
Felix: Mm. I like that. That’s an important point because like you’re saying, if you just going strictly by the numbers, it still works out in your favor to go above and beyond and provide that kind of great customer service.
Now I want to take a step back and talk about the forecasting that you guys have perfected. What’s the process for forecasting a business like this? Like how do you begin to estimate what you need for the coming week?
Mark: Well, of course in the beginning it was a lot harder because there was a lot of fluctuation. We would have really good weeks and then not so good weeks. But once you have enough data, and you’re growing at a pretty constant rate like we have since the beginning, we’re pretty much growing at about 300% per year, then it makes it a little bit easier.
So now the way I do it is I just look at data. I forecast based on averages that we sell. We have 50 different products that we sell, so we have to forecast for each individual product. At the same time, I always leave a cushion for growth because we know that each week is growing is going to get higher.
Felix: Mm-hmm (affirmative). Now do you use any kind of software to help manage all of this?
Mark: Well we use NetSuite, which is a small version of an ERP system, but the forecast I do it manually. It’s kind of like my baby.
Felix: Your own system.
Monica: I am always fascinated by Mark’s ability to do this on Excel spreadsheets manually.
Mark: Well the thing is that since I’ve been doing it every single week since we started the business, then I have so much data in that spreadsheet that it makes it a lot easier to forecast. The spreadsheets are already done, the formulas are in place and all you have to do is plug in the numbers. Then basically you get what you need to prepare in a particular week.
Felix: Yeah, I’ll bet the formulas in that spreadsheet is a sight to look at with all those calculations you have going on.
Mark: Yes. Which is why nobody touches that file except for me.
Monica: I agree.
Felix: It truly is your baby. It makes sense.
So I want to talk a little bit about the Facebook advertising that you guys have been able to do. It sounds like it’s what you’ve been able to use to get that right message to the right persona to the right person. Talk to us about your processing. What’s your strategy for advertising on Facebook?
Monica: So Facebook has been really incredible because we’ve been able to hone in on audiences that are very, very close to our personas, and then therefore deliver messages that are very on target to them. Also, you know Facebook is an incredible tool for businesses because it allows you to reach a lot of people on not a lot of money. We’re very, very efficient with our Facebook advertising. We’re constantly testing new audiences and messages to the audiences. We turn ads on and off very quickly. We’re very data driven, and everything in our business has to be ROI positive. So the return on investment that we get on every penny that we spend has to be positive. If it’s not, that gets turned off and something else that is positive gets turned back on.
Felix: How do you decide what should go into each ad when you are testing it out?
Monica: Well right now we work with a digital marketing agency and they do all of the day to day. They’re pretty amazing. When we didn’t have them and we were doing it ourselves, the strategy was to break up the audiences in a way that would basically the audience would tell us what their interests were. So we would do the messaging that would appeal to them. So for example, when we talked to vegans who like to garden, for example, I’m just picking a random audience, we talked to them about the quality of our ingredients. When we talked to moms who have kids under the age of five, we talked to them about the convenience of having their own lunches on the go.
So we’re able to test the messaging very quickly. We can spend a few hundred dollars testing it, and if we get positive results, we put more money behind it. And the thing about Facebook messaging is that it’s super easy because the message goes in the text. So you can have an image that you use for 25 different messages. The image is the same, it’s beautiful shots of food, but the actual message will say different things.
For example, in the first scenario where we talked to vegans who like to garden because they care about the ingredients, we show them this beautiful fruit and the message will say something like, “Made with the best organic ingredients, locally sourced,” because they care about that. Does that make sense?
Felix: Yeah it does. So when you work with the digital agency now that runs your Facebook ads, what is it like? How do you interact with them on a daily basis?
Monica: We actually interact with them on a weekly basis now, but we’ve been working with them for about a year. When we first started working with them, we had a lot of very long strategy meetings. So we would sit down, you know it was very important to us that they not only buy into the concept, buy into the product, we sent them food a bunch of times, but we wanted them to be able to use the same voice that we use in all of our marketing. Our voice, our brand voice, is very upbeat, very friendly. It’s very light and it’s very approachable.
So in the beginning we literally, like they sent us a spreadsheet with all the messaging that they were recommending based on the audiences, and we went through it and said this sounds good, this needs tweaking, this a no, this is a yes, we don’t like this audience, let’s go in this direction. So we did a lot of tweaking upfront.
Now they got the whole thing down. So now what we work on is every week we talk about results. What’s working, what’s not working, where do we need to put more money, where do we need to shut down ads, which audiences are not responding very well, let’s test some different messages for them or let’s not message that audience for a while. So it’s a lot more tweaking and a lot more optimizing than it was in the beginning.
Felix: Mm-hmm (affirmative). Makes sense. Can you give us an idea of how successful the business is today? How much has it grown since the beginning?
Mark: So as I mentioned before, we’ve been growing about 300% per year. The last year our earnings were 3 million dollars. This year we’re expecting somewhere between 5.5 to 6.5 million.
Felix: That’s beautiful. So what do you guys have planned for the remainder of this year? What are some goals that you want Veestro to hit in the next year?
Monica: One of probably the most exciting goals I think, or the most exciting for me, is we are launching a corporate program. Our corporate program is very cool because what we’re doing is we want to bring healthy food into corporations. Into businesses. So we would come in and we would put a Veestro branded freezer and keep it stocked with Veestro meals so the employees can have healthy delicious plant-based lunches. They don’t have to leave, they’re getting good food for good focus, for good brain power. So that’s very exciting.
We have seen a very nice trend in the corporate world where companies are much more concerned with employees’ wellness. And the last piece of the puzzle is the food, and it’s the hardest piece of the puzzle because if you pay for the employees to go to restaurants, if you give them lunch allowances, they’re going to choose what’s convenient, what’s close or what they want. It’s not necessarily healthy. And if you buy produce, they’re not going to necessarily take the time to make it.
So what do you do? A lot of companies give them snacks, but snacks don’t really give them the right kind of brain power because when you have sugary snacks, you get these big spikes in your glycemic levels and then you get these big drops. That’s why people are needing their coffee at 10 am and then they’re needing their coffee again at 3 pm and another coffee at 4:30 to get through the afternoon.
Our meals are very, very reasonably priced and this program, I believe, is really going to put us into a different market just because we’ll be able to provide these companies with their last mile, the food.
Felix: For sure. I think that’s a great idea. I think the way that you describe it makes a lot of sense, and I think businesses will jump on this idea of feeding their employees healthy food.
So Veestro.com again is their website, it’s a store. It’s V-E-E-S-T-R-O.com. Thank you so much, Monica and Mark.
Monica: Thank you so much, Felix.
Felix: Heres a sneak peek at what’s in store for the next Shopify Masters episode.
Speaker 4: A lot of times you get quicker results if you really just change the entire thing up or even just change the product that you’re showing.
Felix: Thanks for listening to Shopify Masters, the e-commerce marketing podcast for ambitious entrepreneurs. To start your store today, visit shopify.com/masters to claim your extended 30 day free trial.
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About the author
Felix Thea is the host of the Shopify Masters podcast, the ecommerce marketing podcast for ambitious entrepreneurs. Got something to share with Shopify Masters listeners? You can submit your story for consideration.