How Stratus Turned a $4000 Bet Into 10,000 Orders Shipped

0:00I really like when you can have a very niche, solution-oriented spearhead product that can help you acquire customers in the early days and to help you drive your ads even as you expand your product product product. in the future. Hey everyone, welcome to Shopify Masters. I'm Shuang Esther Shan, and this is your companion for starting and scaling a business. Today's guest is the brains behind Stratus, a apparel brand that specializes in headgear for skiers, snowboarders, and cold weather adventurers. Stratus started as a$4 ,000 acquisition and is now celebrating over 10 ,000 orders shipped. And for the last five years, their revenue have doubled year over year.

0:45Owner and CEO Ricky Jones is here to tell us how he's scaling the company without outside capital, earning street cred in niche communities, and staying ahead of the curve on product design and sustainability. Welcome to the show, Ricky. Thank you for having me. I appreciate it. Yeah. Well, thank you for being here. Your journey is very interesting. You actually bought Stratus from its original founder and gave it a refresh. Tell us how you discover the brand and why you were so excited to take it over. Yes. So I moved from the countryside to Montreal when I was about 21. And the roommate I moved in with had this prototype on the table in the apartment.

1:27And I asked him what it was. And he explained the concept and that his friend had just launched it on Kickstarter, and I thought it was really genius. As somebody who snowboards three to four times a week throughout all of my teenage years, I immediately understood the solution that it solved. I really don't like to get cold when I'm snowboarding, and your face is always something that's very much exposed to the elements, but every time you try and cover it up with any other product on the market, it becomes a hindrance. You are either all stuffy, it gets all wet and frozen, in, or you just can't see because you end up getting goggle fog.

2:05When you cover your mouth, your breath has nowhere to go except for up and you just can't see. And obviously when you're skiing or snowboarding and going quite fast, like being able to see where you're going is super important. So yeah, I was completely blown away by this product concept. And given that I was 21 looking to learn more about business, I started working with them for free for the first year and a half and yeah, I really fell in love with the brand and was able to buy it later from the original founder, Dimitri. And yeah, that's history. Yeah. I feel like you are one of the few that we've talked to that had this particular journey where you've gone into the business, helped out the founder, and then got the chance to acquire the business.

2:49What were some of the green lights that came your way that made you feel more confident about this decision? and how did you build up your experience in direct-to-consumer and e-commerce to prepare you for this? Yeah, so the product really sold it for me. I was super interested in it and my parents were small business owners. They had a mechanic shop and my dad taught me from a young age to fuel your career with your passion because it's a very synergistic combination to have those two together. And so it was kind of a no-brainer for me to take it on. And I didn't have to do too much mental juggling with it.

3:25And it was a great opportunity to learn. And in regards to like working towards being full time on this brand and building it up, I started working in startups and trying to fill out all of my skill gaps that I had to operate an e-commerce brand. So whenever an opportunity for a job came that was going to expand my knowledge in the e-commerce space, I would take it. And so I worked for a while doing high volume influencer marketing for an app company. And then I got my certifications for Facebook and Google advertisement. I started working on that through my own business, but then also consulting people with theirs.

4:03And then I had a small fashion tech startup for a while where we did custom made Italian shoes that were, you could digitally get your foot shape and we could then make custom made shoes in Italy that would fit your foot exactly. And it kind of went from there. I worked at a consumer goods fund where I got to manage e-commerce brands in their entirety with bigger budgets. And yeah, and now two years ago, I've been full time on originally North 45, but now called Stratus. And it feels really good to jump into the brand, be full time on it, but also be very confident with understanding which levers I can pull and what the results are of those levers.

4:45So it's really nice to have confidence operating your brand because you've built up experience in the industry beforehand. So now that you're at the helm, how would you describe the current product line and what makes it so unique? So at Stratus, we make a range of technical headwear and our spearhead product is our anti-fog collection of products. These are balaclavas and face masks that allow you to, one, stay warm and cozy. two, allowed you to breathe really well in an unrestricted manner, and three, and most importantly, eliminate the issue of goggle fog, which is a big problem that we have in skiing, fat biking, cross-country skiing, winter hiking.

5:27When you're building up a lot of heat and you're breathing, if you have your mouth covered, your breath will hit that fabric and get forced up into your sunglasses or your goggles, whereas our products seal well against your cheeks. and reduces the amount of breath that can reach the lenses while also allowing you to like breathe really well because it's an open air concept. So you breathe all your hot, moist air down and out away from your face and lenses. But yeah, the athletes from breathing in such a cold, harsh air can develop lung problems. And our product helps like create a micro atmosphere around your mouth and allows them to breathe really well while also breathing in a kind of tempered outside air.

6:13So that's why people really like our product is it both allows you to perform really well while limiting goggle fog and while keeping yourself warm. So you're in such an interesting position because this is a niche and this is a community that you're trying to operate in where there's also a lot of large players making winter apparel. So what are you thinking about when you're operating in this unique space where you're niche, but there's also large players that you're competing against? Yeah, those are two very good questions. It is super niche, but having operated three to four e-commerce brands now, niche is really great in the smaller stages of your business.

6:57and you can always expand your product line to have a broader offering. But I really like when you can have a very niche, solution-oriented spearhead product that can help you acquire customers in the early days and to help you drive your ads even as you expand your product collections in the future. And when it comes to big brands, we always worry about it, but we don't have to worry about it too, too much because it's a small category. It's niche. and they were overlooking that product category for a long time. And that's why there wasn't a good product out there. A good solution was because big brands will want to sell you their ski jacket or their skis because they're high ticket items.

7:39And then when it came to balaclavas, they're just like, well, yeah, that's a tiny category. They tell their product designer, oh, we need a balaclava. And they just whip something together from the classic standard template. They put their logo on it and they don't worry about it too much. but then they invest a lot of R &D in their big product category. So sometimes going after these small categories means, one, it's not looked at too much. And yeah, there might be a gap to really solve a problem that consumers are having. Well, it's so great that you saw opportunity in this gap and you were excited about it because Stratus has been growing.

8:13It's doubling year over year. And also you just reached the milestone of 10 ,000 orders. What are some strategies or key decisions that you felt like really helped you to reach that milestone? Yeah, so going full time on the brand was, I think, one of the biggest contributors to us being able to cross the 10 ,000 product mark. As a seasonal business, it takes us a little longer to scale up like that because every season we bet on our inventory position and then we try and hit those numbers come that winter. and really double down and make sure that we're doing all the efforts that we need to to get the products to sell and to hit our milestones.

8:56Being full-time allows us to do that. Marketing for Stratus is also very different because you're trying to reach these communities in mountains and niche places. Some of the times these people of influence are not influencers or social media creators, but yet people trust them for advice on gear. So how are you reaching those individuals and getting them on board? Yeah, that's a great question. We spend a lot of time at our local ski shop. In our area, we're close to Ski Uphill, which is, they have shops in Canmore and Squamish, which are ski epicenters. And then you also have Valhalla Pure Outfitters in Canmore that we spend a lot of time at, and Minod's Banff, which is Banff's oldest ski shop.

9:39And we spend a lot of time there. We make friends with the staff. We go skiing with them. And, you know, just spending time in the store, sometimes they'll look at me and they'll be like, hey, Ricky, that person, like you'll never hear about them. They don't have social media, but like they're getting at it and they're skiing big lines. And I'm like, okay, hey, do you want some free product? You know, and sometimes these are great people to connect with because they're kind of introverted, analytical, dedicated, and they might be skiing like 150, 200 days a year, which is absolutely incredible.

10:12And you give them a product, you're going to find out what their feedback is. And like you said, they're people of influence. They're ski bums sometimes where they work during the summer, save up as much as they can, and then they just ski, ski, ski. And these are the kind of passionate people that drive credibility. It gets very small at a certain level of passion and commitment to a sport. And everybody knows everybody in these small towns. And we aim to get in front of those people and to talk with them and to get product in their hands. Yeah, because it is so much dedication you're putting into in making those connections with people of influence.

10:46How do you make sure you balance that with running a business at the same time and building those connections too? Yeah. So we do identify athletes and influencers that have like a larger reach and we do reach out to them too. What we're very careful with though when we pick those individuals is to make sure that that very hardcore skier is going to respect the decision that we make to work with said influencer or said athlete that has a big reach. so yeah I think that's the important part we we're willing to put money into the community and to give product into the community to people that that won't have that kind of like direct Shopify traffic you know spike while also working with people that will and just making sure that those two parties actually like are quite connected it's just that one person's more extroverted and puts themselves out there.

11:46But they're very much the same type of individual that we go after. We don't go after kind of the, I'll take a photo on a peak for Instagram and, you know, just pump out content type influencer. We really look for people that would strike that balance of being authentic and close to our core audience as well as have that reach. Yeah, like they actually genuinely enjoy the sport and actually can provide feedback and interactions with the product as well. I know that there is still seasonality, even though, you know, there are people who ski 100 to 200 days a year. How do you think about marketing and inventory and forecasting when you are operating in a seasonal capacity?

12:32Yeah, it gets difficult. Every season is a gamble on what your inventory position is. And our product as a balaclava is really for cold weather. So it's dependent on the weather as well. So yeah, it's a bit of like a risk versus reward. How much can our business take as a risk in terms of growing our inventory position compared to last year versus like us being able to hit our targets of growth? And I really think that's that cost versus benefit analysis that we need to do. And I really believe that founders should have a tight grip on their finances and on their financial documents and projections.

13:12That's how we make that choice. And we also try and reduce our kind of cash flow hits with this by working with our factories to get shipments shipped to us throughout the season rather than getting into big one-shot shipments, which can really strain the cash flow of a small business. I think for someone who is starting out, they're in a product-based business where they have to invest in inventory and get comfortable with good financial hygiene and projecting sales, what's your advice for them to kind of like check a few things off to make sure that they are in a good place? Yeah, I would really recommend that either take online courses, use ChatGPT or AI to help educate yourself on what's important.

13:59And I would recommend working with a chartered professional accountant to build out a document template that you can use that has all the categories for e-commerce and get yourself comfortable with it. if you have a good grasp on it, or if you can find a co-founder who has a really strong grasp on it, it really reduces your risk because you're not taking decisions blindly and you can kind of forecast realistic versus pessimistic versus optimistic scenarios for your season, for your upcoming quarters. And that would be my advice is if you don't have that skillset, invest in finding it. Yeah, well, it sounds like you have a great balance between reaching out to the niche communities and also experimenting using digital ads to reach people outside of those communities who might be traveling to go skiing or snowboarding.

14:54Yeah, tell us, how have you been experimenting with digital ads in that regard? Yeah, so the way that we present ourself is very targeted and niche, and that's part of our marketing strategy. We do present ourselves for and as a more intense, dedicated enthusiast. But we do sell a lot to people that are traveling. A lot of our clientele is in Texas or California, and these are individuals that are traveling to, you know, some of the fantastic ski hills that are located in the U.S. or in Canada, like Bam, Flake Louise, Revelstoke, Gold, and Whistler, you know, Alta and Snowboard in Utah, for example.

15:37These travelers, they're willing to spend a lot of money for their trip. They will go for a week or two every season to different mountains to ski. And with Facebook's targeting, which is a lot more broad nowadays when it's effective, we don't have to worry as much about this. Facebook will help us, or Meta will help us target the individual that is ready to buy. That is near our hardcore clientele in a somewhat adjacent but close enough targeting. Luckily, advertising has become less technical than it was 10 years ago. And we can rely on things like Shopify's integration with Meta or Shopify audiences with Shopify Plus, which really help us get in front of the right consumer.

16:21So we focus on curating our content and our ads and our Instagram to be the way that we want to present ourselves. But the platforms now are so advanced that they can target the individual that is adjacent and maybe a bit less niche and help us scale up our sales. Yeah, it sounds like a good time to actually experiment and also have digital ads complement your main marketing goals. And at the earlier part of the show, you mentioned how, you know, you had this rebrand as well from North 45 to Stratus. what made you have this rebrand? And also, I feel like it's a difficult thing to go through as well.

17:04Yeah. Even as a small brand, it was so much work. And I can only imagine if you're like a really big brand or a brand with a lot of SKUs, how laborsome this process was. But we really felt that being a distinct original brand with a unique brand name and brand identity was important to us. We are trying to lean into a new mission value. And I think the decision to rebrand should be based on some sort of pivot or expansion. It should be a reflection of a new direction and not just a rebranding for the sake of rebranding. And Stratus is representation of our location in the mountain. The Stratus cloud is kind of around our elevation band and our tagline is rise above, which is a big talk to us ski touring and getting out there and getting above the clouds, as well as our connection to the environment and our commitment to sustainability, which we've always had as personal values and tried to integrate into the brand.

18:08But with this rebranding, it was about us not only showcasing this through our packaging and our products, but making a statement through our website and our sustainability page and through our branding. So Stratus is an encapsulation of kind of our commitment to both performance, editorial-like presentation, as well as sustainability, which previously North 45 had parts of. But we were ready now to like really express this fully. And our choice to rebrand has both helped us do this, but also helped our credibility with consumers and has driven lower advertising costs and etc. And through experience, we knew that a strong brand would have that effect on not just our intangible parts of the business, but the tangible financials and costs of acquiring new customers into the Stratus brand.

19:09Stratus also sounds so much more cinematic, and I feel like there's great energy around it. For those who might be contemplating a rebrand, I think there is a million things to worry about to make sure the transition is smooth for both the business operator and also customers. What are some key checklist items you would offer up for someone who's contemplating doing this for their business? Yeah, I would contemplate your timeline. put a lot of effort into giving yourself buffer on all of the tasks. And thankfully, Shopify with the redirects has gotten just so easy. And you can download your sitemap online and see all the pages that are there and make sure that each page is getting transferred.

19:57And that's just a really slow, diligent, step-by-step process where you make sure everything's transferring over. and that aspect which I think like back eight, ten years ago would have been like quite laborsome and might have needed some SEO specialists is now really easy thanks to Shopify's development of these features. And otherwise it's a lot of like your product, your packaging, your website and just really take your time to outline every part of the process and be exhaustive and then give yourself buffer on those tasks. It ends up being a lot more work than we think and the devil's in the details and it takes a lot of time to kind of check everything off the list.

20:42So I'd mostly just say to give yourself time. Yeah, huge undertaking. And I'm also glad you mentioned about the product design and the packaging, not just in relations to the rebrand, but I think you also weave in this layer of sustainability for the brand as well. How do you incorporate that pillar into everything that you touch? We have it as a personal value to have less impact on the planet. And having worked in the industry for a while and being curious and researching a lot, I found out about all of these small details and nuances within sustainability. Like, for example, a lot of compostable mailers are only compostable in, you know, like a dozen industrial composting centers across the U.S.

21:30So most of those actually aren't even compostable. You can't put them in your home compost. They would end up in your municipalities composting and hinder that batch of compost because they won't break down without a very specific composting environment. So over time, we found this out. And now we try and make our decisions in a very educated manner. And I'm sure that we're going to find out in the future that some steps that we're taking, maybe we have to take back because there's a better solution out there. But we're really trying our best to push that envelope and to not openly accept something that's marketed as sustainable as actually being so.

22:11It's mostly about being passionate and committed on the subject and doing a lot of research. I want to bring this full circle. We talked about operating in a niche community for aspiring founders who want to do the same. What's your advice for spotting an opportunity and building a great business? Yeah, I really think that if you're going to launch a company, you should be living and breathing your niche before trying to launch a business in it. I think, and this happens with so many brands, that you identify the gap in the market by actively participating in that same activity as your business would be in.

22:55And I think that's the most important. I know, especially in my early 20s, myself and other people that went to launch businesses or that you'd meet at events would want to be like, oh, I want to start a business. I'm looking for an idea. And I think ideas come to you. You can't that much actively look for it. You can maybe have that in your mind that I would like to start a business one day and wait for the right idea to hit you. I think that's the most important aspect. And do it in something that you're passionate about. I think going into business just to go into business and to hopefully make a lot of money is really not a good idea.

23:38One, because starting a business is so hard. It could be both emotionally and physically draining in the sense that you have to put in long hours. I know sometimes I was doing trade shows that I'd wake up at like 7.30 in the morning to get to the trade show at 9. when I'd get home at six, I would eat supper and then start shipping orders till 1am. And I don't advocate for like grind mentality. And, you know, I believe that business is a marathon and not a sprint. And you really have to manage how much exertion you're giving on your business and protect your physical and emotional wellbeing as you're going through it.

24:18But there's some days that you need to just push and then you can maybe give yourself a break after. But at that period, you have to go through. And if you're just doing it for the dollar, you may not have that drive to keep pushing through it. But when you're doing something that you love, we really want to carve out a career for ourselves in the ski industry. We want to be able to, yeah, you know, go on awesome ski trips and build products that help us in our activities that we do multiple times a week. so there's a strong drive for us just to have fun um and and build out a business in it and it's it's not just about the money like uh there's a there's a great country song i like by luke combs saying it's called like doing this and essentially the the premise of the song is if he wasn't rich and famous doing it he would still be doing it um and and i think you need to find something that aligns with you in that way if you're going to launch a business yeah Yeah, yeah.

25:19It definitely needs to be something that actually fits into your life. And to your point, I think like being so entrenched into your interest, that's when you can see the opportunity and be excited about it and be able to want to keep on building for it. Closing off the show, I would love to get a sense of your long-term vision for Stratus and where you want to take the brand for the future? Yeah, so Stratus' long-term vision is about offering high-performance accessories and in the future, a larger apparel line that is a lot less damaging to the environment. I think a lot of brands right now will react to the market rather than being proactive.

26:02So sustainability is so many times talked about in a way where when consumers are going to ask for more sustainability, we're going to give that to them. Or for example, there was a damaging chemical in rain jackets called PFSAs and brands only started reacting to removing it, or at least the majority of them, when regulations came in in Europe to remove that. And for us, we want to be proactive. And if we can make a product entirely biodegradable, there's landfills in Chile that just collect large amounts of outerwear and apparel, and it just becomes these gigantic piles. And I think consumers need to be more conscious about where they spend their money and what the afterlife of their gear is going to be.

26:53And we want to provide them options that are not just sustainable, that also look good, are marketing in an interesting way, and that will be performant for them. And if we're able to do that while being kind to the planet, then we would be hitting our long-term vision. It sounds like an exciting future and very excited to watch Stratus grow even more. Thank you so much for being here, Ricky. I appreciate it. Thank you for having me on the podcast. Our show is produced by Alicia Clark and Gogo Zogor. Our engineers are Miku Bellum and Matt Shorts. And I'm your host, Shuang Esershan. Come join us every Tuesday and Thursday for brand new episodes and check out our YouTube channel for video interviews.

27:38Until next time, thanks for tuning in.