A Consumer Product That Helps Fund Humanitarian Projects

0:00We started to really reorient the company towards a retail model that could then help fund the humanitarian work as opposed to a humanitarian model that then had a little side hustle as a retail business. Hey there, I'm Shuang Esther Shan, and you're listening to Shopify Masters, your companion for starting and building a business. Most founders start with a consumer product and then figure out ways to make a positive impact in the world. LifeStraw was almost the opposite. The parent company designed the product for humanitarian use in Africa. The goal was to help eradicate Guinea worm with a straw that could filter out parasites and bacteria to make water safe to drink.

0:46It wasn't until 2012, nearly seven years after LifeStraw was introduced, that the company entered the consumer product business. Today, we're chatting with LifeStraw's chief brand officer, Tara Lundy, about the switch to consumer products and how other businesses can bring authenticity to their impact work. Tara, welcome to the show. Thank you so much for having me. Very happy to have you here, Tara. So we know that LifeStraw started as a humanitarian organization and it was created for that purpose. When was it that the company realized this product could cross over into the consumer space? We started really with a very specific humanitarian purpose to eradicate Guinea worm.

1:33And that was about 30 years ago. We worked with Jimmy Carter's foundation, the Carter Center, and created this pipe filter in 1994. And then about 11 years later in 2005, we created the original sort of life straw that most people know the company by. I would say around 2010, as the product gained more notoriety for the humanitarian work we were doing, we started to just get individuals and in some cases retailers and distributors out of the blue contacting us to just say, can we buy this? Can we sell it in the United States or for the purpose of hiking and outdoor industries type of activities?

2:17And so we just sort of organically realized there was market potential for that particular product and then sort of tiptoed into retail with a distributor until it really started to take off and become a pretty meaningful business, in which case we started to really reorient the company towards a retail model that could then help fund the humanitarian work as opposed to a humanitarian model that then had a little side of the company. hustle as a retail business. So it sounds like the process for this transition was organic and happened over the years, but how did the team go about developing products with consumers in mind?

3:01We used the straw in the outdoor space for a couple of years to just start to get a sense of was there enough market potential? What were people buying the product for and using the product for. And then we worked pretty closely with both our consumer base and some of our key retailers like REI and Outdoor Independence that sort of generated product development ideas and demand. And it became really important to us to actually say, okay, we need to have product pipeline and strategy that's oriented towards customers and also continue to maintain the authenticity of developing product for humanitarian relief.

3:44So in our give back program, we don't just donate the same product that we might design for an outdoor customer, even now a home customer, travel customer, we have specific products also designed for humanitarian relief and large scale development challenges. So we started by evolving into a bottle product that's quickly became one One of our best sellers and continues to be is the line of water filtration bottles. And then about five years ago, we got really serious about really creating a full line of product that was oriented towards the outdoor customer that really took into account materials and weights and flow rate and all those things through focus groups.

4:29And just having had then five plus years of experience within the industry itself, talking to people at trade shows, talking to customers, talking to buyers. And during that time, we also started evolving strategies that were more lifestyle and travel focused as well. But outdoor is really our first core consumer and one we pay attention to very carefully because that customer has very specific needs and wants. So there's so many diverse processes for developing products from focus groups to trade shows. Can you walk us through some of the design process or brainstorming exercises that the team did to kickstart the product design?

5:15Yes. So with technical products like ours, it's an interesting process because you have to look at what you can do from a technology standpoint and sort of evolve the actual filtration itself. Can we meet size and weight requirements? Can we improve flow rate and efficiency? because especially in the outdoor space, you're always trying to create something that's smaller and lighter and more packable. So we had sort of our engineering side of the business looking specifically about how we can evolve the filtration technology to enhance the performance specific to the outdoor use cases. And then we started doing just quite a bit of landscape analysis.

5:55As I mentioned, having touch points with different layers of customers. So everything from looking at product reviews of our own products, speaking to our own customers, but also speaking to buyers. And then also looking at what's the competitive set out there. What are the top performing products in outdoor filtration? Where do we think we have an advantage or a value proposition? And also, quite frankly, and what's been really interesting and important is just looking at product reviews from other types of products as well. One of the value propositions of one of our newer products was really not as much the filtration, but just having a much more durable and robust squeezable flask because we saw that across the market, people were getting really frustrated that it was actually the vessel that was breaking down in the field versus the filtration.

6:44So just trying to glean all those little learnings and then test and retest and beta test and alpha test and focus group test and tweak and tweak till we got somewhere where we felt like we really had a five-star product that we could launch. Yeah, I also assume the other big change with this pivot within the organization is the distribution model. Before you probably worked with other organizations and government bodies to do the distribution, and now you have to build up this network of retailers. So how did the distribution strategy change as well? Yeah, that's really interesting. I think logistics always plays a big role in ability to scale.

7:31So all the back-end operations and things like that, that is often not as well talked about, but so critically important. So we kind of had to learn as we go. We started off with the true distribution model where we were selling to a distributor that managed and operated their own warehousing, ran our e-commerce sales, ran distribution to retailers as well. And then as we sort of built up the business, we started taking pieces of that back. So we eventually onboarded our own 3PL within the United States, started creating all the systems internally to kind of operate our own sales. Eventually in 2018, launched our own direct-to-consumer site with Shopify, in-housed our Amazon accounts.

8:25And then we work with sort of sales reps on the outdoor side specifically that have touch points to all the independent retailers. And then we work with a lot of like higher level retailers directly. So we had to build out both sort of our operational 3PL distribution strategies and our sales team in order to manage that. And the fastest growing side of the business has been in e-commerce, both with Shopify and Amazon. And in fact, Shopify has become our second biggest sales channel, which is unusual for kind of a hard goods company like ours. But I think we have a really interesting and dedicated consumer base based on the history of the company and us being a B Corp and climate neutral brand that really speaks to people wanting to connect with the brand in a direct way.

9:14It sounds like initially for the distribution, you relied on a third party distributor who helped with that side of the business, but slowly the team did want to have everything in-house. Talk to us why it was so important to also start your own store on Shopify and own that piece of the e-commerce channel as well. Yeah, I think that has been really critical. I think until you start your own D2C business, you don't realize the level of value it brings in terms of direct communication with your customer. Obviously, it's much more customizable. With retailers, you have a lot of e-commerce constraints.

9:59With Shopify, we've been able to do a lot of customization where we have more opportunity for storytelling, which is really important to our brand in particular. You know, you can host customer experience resources that provide guides for people to use your product properly. We've been able to offer subscription models for replacement filters and really also just glean so much data and information from our customers based on what their needs are, what their buying patterns and consumer behavior is. That's really helped grow the business. It's also a really excellent way to launch and test new product.

10:39I think you get more instantaneous feedback from having your own direct-to-consumer business. And, you know, we can integrate so many things. We live in this digital world now, right? So you can drive from your social channels, from your email, so many different ad platforms that can all integrate and then also just have access to just almost real-time data about the customer journey and even geographic information about where they're coming from that you just don't get when you're kind of working with a layer in between, even if it's an e-commerce retailer. So I think it's just been really amazing to use, look at all the different analytics and see who our customers are and how we've also been able to evolve them over time because we have transitioned to offering more lifestyle products.

11:31And we can see that transition happen fastest on our direct-to-consumer business. I think what's interesting to highlight here is the bestseller on Shopify isn't a product. It's not water filters or a pitcher. It's actually free water. So tell us what that is and why it's been so successful and impactful. Yeah, we always joke that our top performing product is what we call GiveSafeWater. And a couple of years ago, as part of a strategy to take in more funding for humanitarian response work, we fund our give back program through product sales, but we're always looking to bring in additional funds for specific emergencies.

12:14So just in the last year, for example, we've been responding to emergencies in Gaza, in Morocco, in Ukraine, all over the world. And those tend to be something we need more flexibility, faster paced. We realized there's this opportunity and flexibility within the Shopify platform to sort of have an add-in to your cart in which we said, would you like to provide a contribution to support safe drinking water? Part of the benefit to the customers is also you can use that to round up to your three stripping thresholds. But we see increments of$2,$5, but that has actually become our top selling products because people, I think, are connected to the brand when they shop on our D2C platform.

12:59They see the work that we do. They see that we're an authentic brand and they're willing to kind of contribute, you know, just a little bit of extra funding for us to do that impact work. And so I think we had over$50 ,000 in contributions last year just from that little checkout item that's enabled us to do quite a bit of work because we do everything at cost across our humanitarian portfolio platform. I definitely think this is the most special case of customizing a checkout, which is something my team members talk about often for the benefits of being on Shopify Plus. So thank you so much for sharing that.

13:42And we're going to dig into more ways other businesses can be impactful in their business model. But first, I would like to take a moment to thank you for tuning into the show. If you haven't already, make sure to subscribe to Shopify Masters and leave us a review with feedback for the show. Thank you so much. I think LifeStraw's authority and trust by its community is due to the fact that the team has worked decades in humanitarian efforts. For our listeners who are potentially new founders and they do want to have social impact within their model, how do they demonstrate their authenticity and commitment in those efforts?

14:29Yeah, I think that's a great question. And it's one, even though we have this deep and rich history of doing social impact work, you're always trying to answer the question when I have my marketing hat on is how do you tell that story? How do you look authentic? Because we now live in a sea of brands that are all have their corporate social responsibility goals and are communicating the work that they do. part of it is just looking at what's truly authentic to the business where's that like personal tie or where's that core tied to the product for us it's obviously a pretty easy story because we're in the business of providing safe drinking water and so we utilize the products and the development in order to further that goal, but also really being able to document and show impact.

15:23We find a lot of ways to communicate with customers beyond the promise of for every product you purchase, a child receives a year of safe drinking water. We found that people really want to know more, but you also have a very short attention span from customers, right? So we utilize email newsletters. We utilize our social channels. We segment our emails for customers that have contributed, made that contribution for Safe Water on D2C. We send them a specific email that said, we're not trying to sell you anything. We just want to update you on what your contribution did in the last few months, or we'll customize that button when we're doing something specific and saying, right now, these contributions go to our ongoing efforts to provide Safe Water in Gaza, for example.

16:12And we've also found that just being really transparent, this generation's customer is very savvy and they just want to hear authentically so you don't have to do everything super polished. It's about saying, you know, this work we do is really hard. And we, for example, in a lot of the work we have been doing with Gazas, we've had a lot of questions like, how can you be sure your product's actually going to get there? And we have to say, you know what? We can't be sure. And we're trying our best. And we're going to keep you all informed in the process and the steps that we're taking to do this work.

16:50But it's not always easy. and some of those messages and posts have been the most high performing because it's just really being very open about the work that we're trying to do as opposed to kind of having like a very polished kind of doing good page that it's really providing those ongoing updates to your customers and in listening we have so many people that email customer service to ask about tell us about a water crisis that's happening, asked if we can do anything about it. And so I think really being responsive as well is really important so that it's not just like we've created this program, this is the only thing we do.

17:34And that's just what our singular CSR objective is. We try to be really responsive, really authentic. We have a team that's out doing that work and just communicated as much as possible. Yeah. And I think that advice really translates to any relationship, having that open dialogue and staying transparent, even though sometimes it doesn't have to be so polished. I'm also glad that you mentioned LifeStraw's current work. I think a lot of events happening in the world and businesses have a hard time responding or incorporating different missions. How do founders go about fitting those initiatives, those messages into either the brand mission or just the day-to-day communication to stay open and transparent with their customers?

18:28I think people really appreciate that as well, is to not try to just jump in on what's like the latest humanitarian crisis that's in the public eye, but to say like, This is where we feel like as a brand or as a company, because we have this unique skill set or this unique product, we can truly make an impact. We also spend a lot of time talking about places like South Sudan or Tigray, Ethiopia, where there's huge water crises that are not in the public eye that have really significant direct impact on people's lives and where we feel like that's where we can make a huge impact. And while you don't see maybe the level of engagement as a cause, I think it helps to show that we're not just jumping on a social media trend.

19:18is that people are able to see that there's an existing commitment, an existing portfolio of work, because a lot of times brands take a lot of heat when they sort of jump into something that's happening that they haven't sort of established a history of doing that work or doing good. And customers are very quick to call out brands for being performative by just sort of making social media posts and supportive things. So I think it's just really taking the time to find where you can have a true impact. And it doesn't have to be huge. It can be in your own local community where your brand exists.

19:56And then being able to show that that is a demonstration of your values and your work. So LifeStraw is creating more products for the home. Talk to us about reaching those different customer profiles and speaking to them and meeting their needs when you're creating those marketing assets. Yeah, definitely. The real motivation to get into the home business was when all of the news started coming out about Flint, Michigan and the lead crisis there. And at the time, we did not have a product that addressed that situation. But a lot of customers around the world are reaching out to say, okay, can Lifestyle do something?

20:36Because we kind of know you as a brand that responds when there's a water crisis. And so we really started thinking more specifically about, okay, well, it's not just the cholera and E. coli and things that are affecting humanitarian emergencies that are causing health issues in drinking water. But we're now starting to see some real significant health impacts from emerging contaminants like lead. Like PFAS has been in the news lately. Microplastics, we don't entirely understand the health impacts yet, but everyone's pretty wary of just how many are in drinking water. So we really started pivoting our research and development to say, okay, can we take our core technology that actually removes microplastics and bacteria and parasites and combine it with something that can address the broader spectrum of health issues that are happening in tap water in places with more developed infrastructure like the U.S.?

21:38However, a lot of that infrastructure is breaking down and is quite a bit old, so there's a lot of heavy metals and other things. And so that took us several years. It was one of those scenarios in which we did have to say to customers, you know what, our product isn't right to address the Flint issue. And so we're not going to sort of pretend that we're a solution. Here's other things that perform better than we do right now. But at the same time, we're really going to work on this. And so we were able to launch a set of household products that do have that sort of dual value proposition of our core technology, but also address a much broader range of issues.

22:18And then, of course, also thinking about customers and like, what can we do differently in this space? And so we have, you know, a glass carafe that's really nicely designed that has more sustainable materials that, you know, speaks to a customer that's like looking for a more premium level of protection and level of design and materials than you would typically get in a normal household water filter pitcher. It's definitely been a more interesting way to walk into a space. In the outdoor industry, we are a market leader. In that space, we absolutely are not. It's a much more competitive landscape.

22:54So really trying to figure out how do we carve out a value proposition? How do we communicate to customers as a smaller brand in a very, very large space? I think it's really been able to bring in a new set of customers. And again, home is our fastest and largest growing product segment on our D2C business, actually. So again, somewhere we've really seen our customers evolve most quickly, and it can actually help us sort of trend and forecast how we think retail will move, which tends to move a bit slower, and what products work the best. So we see a lot of potential. And in fact, we've actually ended up using it for emergency response in the U.S.

23:40When Jackson, Mississippi had their water crisis, we were able to use the home product because it still removes bacteria. been using it in some hurricane response really significant flooding that happened in kentucky and our headquarters in baltimore and they had a big water crisis too e coli and a cryptosporidium outbreak that we were able to sort of literally drive to our warehouse and pick up product and go distribute so it's it's coming to fruition and where we thought we could be both a value add in terms of human health to stay to our core but also offer something new and interesting from a consumer retail perspective as well.

24:18Yeah, of course, it's cool that the business is moving in both directions where new products can help the humanitarian side and vice versa. So I definitely think that's so special. I think the question here is because now you have so many different product lines and there's so many different initiatives that LifeStraw is involved in and having impact in, what is the challenge here to not only appeal to all the different customer profiles, but also manage all of the different projects and also communicate them? It just seems like there's so much different areas that you're juggling. Yeah, it's definitely marketing has certainly become and communications has become more challenging over the years as we've expanded our different segments and portfolio.

25:09we really do have to kind of think strategically in terms of content creation on how we're telling stories based on the customer segment what we're learning we've kind of defaulted to thinking about our segments in four ways outdoor emergency to the home business and in each one of those segments we do have a little bit of a different content strategy in terms of who's the customer what do the visuals look like? What are the key value propositions? But we also try to kind of create an overarching set of brand guidelines that unifies the look and feel of the brand from a font creative color perspective.

25:48So you can see that things are connected. And then it helps us to have this sort of authentic brand story that we do all this humanitarian work, because that also helps unify the message across the different segments. It's like at the end of the day, what we're trying to do is provide safe access to drinking water in a variety of different formats. But I think at first, like you said, we originally thought, okay, we just reach out to our outdoor customers, tell them we have a home product. Like that's the easiest way. And we actually realized pretty quickly that that was not the best way to go after that business is it really was probably a newer, different customer that consumes media in a different way, right?

26:30They're not necessarily the same ones reading outside magazine and, you know, looking at outdoor podcasts. So while we kind of were able to leverage that base a little bit as a beginning standpoint, we really had to think differently about, okay, what is this customer looking for? But I think overall, it's nice to just be able to anchor and come back to the fact that the core of it is providing safe drinking water. So LifeStraw just came out with a new product that blends the outdoor and the home, and it's an evolution of the Hero product. Talk to us how it fits into the product lineup and also potentially the future roadmap for LifeStraw as well.

27:16So we have something really exciting that we just launched. We're calling it LifeStraw Sip. It's really an evolution of our straw over time. It's a much thinner, sleeker stainless steel straw that removes bacteria and parasites and microplastics and comes with a nice carry case. And it has sort of a variety of use cases. I think really anywhere from you can take it to a restaurant if you're not wanting to drink directly from the tap, starting to worry a little bit about microplastics and other things, to taking it internationally on vacation. I was just in Mexico with my kids and they were using it to drink kind of at roadside restaurants, things like that.

27:57And it just is really compact. It's come a long way from our bigger straw that we have for the outdoor use case. So it's become really interesting on how to market it because I think it's a really hybrid of lifestyle and travel. But we're also seeing a lot of interest as an accessory even from the outdoor industry as well. Yeah, for sure. It's such an impactful visual and it's also such impactful work. Very excited to see how Lifestraw will continue to evolve. Thank you so much for being here, Tara. Thank you so much for having me. It was a pleasure. That's Tara Lundy, Chief Brand Officer at Lifestraw.

28:37A big thank you to our team. Our producers are Megan Coyle and Gogo Zoger. Our engineers are Miku Betlam and Matt Shorts. Benjamin Gottlieb is our managing producer and I'm your host, Schwang Esther Shan. We will catch you next time on Shopify masters.