Packaging Power: Tips That Will Help Your Brand Pop off the Shelf

0:00So, honestly, in the very beginning, it was a Ziploc bag that we wrote Sharpie on, and we put it in a brown paper bag and then we drove and dropped it off on people's doorstep. Hey, it's Shuang Esther Shan, and welcome to Shopify Masters, your companion for starting and building a business. The dream for many is to turn family recipes into a thriving food business. Jen Lau and Caleb Wang made that dream of reality with their company, Mila. Running Mila allows Jen and Caleb to connect their family history while providing a space for Chinese culture and cuisine within the American food ecosystem.

0:42Mila started out as a street food restaurant and then transitioned into a multi-million dollar direct-to-consumer food brand, serving up authentic frozen soup dumplings. Jen's here now to share all the learnings she's gathered from rebranding, working with retail partners, and securing Simu Liu as Mila's celebrity investor. Jen, welcome to the show. Thank you so much for having me on here. I'm so excited to chat. We understand Mila started out as a restaurant. We'd love to hear how you found out that soup dumplings was the perfect vehicle to transition the company into a direct consumer brand.

1:24Yeah, so at the restaurant, our star hero product is something called Xinzhen Bao, which is a pan fried soup bao. It's a cousin of the soup dumpling that is not very well known because of the way that it's cooked. It's cooked in a cast iron pan. You have to cook about 70 to 80 of these at a time and then sell it within 20, 30 minutes for it to be hot and fresh and crispy. And so this concept that we had started as a street food restaurant really was focused on the singular item with a couple of supplemental products when we had launched the fast casual restaurant. And then during COVID, we had shut down for a few weeks.

2:04And during that time, we were experimenting with our chef. what else we could do potentially to pivot the business or to supplement what we were doing while we were shut down. And since the soup dumpling is a cousin to that hero product, we just started to do that. I don't think when we had started for soup dumplings specifically, it wasn't necessarily that we had done a lot of research. We didn't have a lot of data to back that up. I think it really was just more of like a, okay, we have the learnings from the Xinjiang Baal. This is a logical kind of product for us to test out. And let's just see what happens.

2:44And it felt like it was a lightning in a bottle moment. Because I think Ding Tai Fong has done such a great job of opening their restaurants, educating customers around dim sum and Chinese food, really educating people around how gourmet a soup dumpling is. And then for us, we were able to capture that momentum and that interest for this cuisine when we had released our first soup dumpling paired with, you know, people at home, they want to try this and they can't get it anywhere during that time. So it really worked out timing wise for us. I like how you mentioned that there wasn't a lot of data points, but you recognize that there were cultural moments like the explosion with Ding Tai Fung.

3:26So that really signaled or actually supported your idea of focusing on soup dumplings. And I imagine working in a restaurant and running it, you get that immediate feedback, right? Reaction of people eating your food. So was there any feedback or understandings from the patrons from the restaurant that you brought in to the production of the first iterations of soup dumplings from Mila? So for the restaurant, we, I think, held a standard of we really want restaurant quality, chef crafted, you know, here's the bar of the food that we're putting out there for the restaurant food, where it really had to be almost exactly what we had tasted in China and really had loved.

4:11And that's what we had wanted to bring over. And so I think very early on in our DNA, we had set that bar and that threshold of this is exactly what we want. We're not going to compromise on it. And so I think that principle carried over when we started the DTC e-commerce business with soup dumplings, that same concept of, you know, this has to be the gold standard. It has to hit this quality threshold. we really held firm on our parents have to say it is the best frozen soup dumpling they've had our grandparents have to say that and it does have to have you know broad appeal as we think about expanding so that was definitely one piece that we carried over and I believe is in our DNA I mean people really liked our restaurant food so we knew we were doing something right yeah And it's crazy to think about because if you had recipes that you bring into an industrial kitchen for a restaurant that's already such a difficult feat to tackle, and then you layer in the aspect of transitioning to direct to consumer, how did you even start to think about production, sourcing ingredients, and also packaging?

5:23doing. In the very beginning, our first iteration was definitely a rough draft. But for us, I think when we had started Soup Dumplings, we had no idea whether it would be a success or not. It was just trial. And I think that's an important piece is like, if there's a way to do a beta test or a pilot or a V1 of whatever you're thinking about, to go do that. And I think you can gather data points and that can inform, you know, how you plan for the rest of it. So honestly, in the very beginning, it was a Ziploc bag that we wrote Sharpie on and we put it in a brown paper bag and then we drove and dropped it off on people's doorsteps and we gathered addresses and orders on Google form and then we used a PayPal link for payment.

6:11So that was, I would say, the first couple of weeks of what we were doing. And then we moved to not Ziploc bags, but like unbranded plastic see-through bags. And then we had stickers and we would stick those on it. And so we just kind of step by step kept evolving what we had in terms of the packaging, the product, the infrastructure, and we just let the demand lead us to what we needed to unlock next. I almost had a vision of a movie scene where they show iterations of your packaging. It's so cool to hear how far it's come and how much it's developed. So for founders who are going through that transition where they're trying to change the model of their business, has there been any tools or apps helping with planning, forecasting, logistics that has really helped you and Caleb in this transition period?

7:07I wouldn't say there's necessarily out-of-the-box tools, but I think we were in a fairly unique space because we were doing frozen direct-to-consumer product, which a lot of that infrastructure just wasn't built out at that time and is still pretty nascent right now. So there's a lot of frozen infrastructure for grocery stores, for enterprise type of product movement, but not really for direct-to-consumer. And even for the national networks, I think during COVID, I'm sure a lot of us can remember where things were delayed in shipping because things were built out for residential shipment and delivery the same way that it was for commercial delivery.

7:47And so a lot of what we were doing from the logistics side was pretty much from scratch. We did have a partner at the time that we worked with for Frozen, basically a Frozen 3PL. It was a warehouse they pick and pack and then they sent it to a network to be shipped. We did have a lot of mispicks and a lot of melting. And so then we had to completely revamp which warehouses we used. We worked very closely with those 3PLs to build out their systems. And we did a lot of the legwork to do the data analysis. So, I mean, this is still, you know, Google Sheets or Excel that we're doing for analyses at the time.

8:24But we would do that, show them, hey, here's what we're tracking. And here are the number of reach outs that we've gotten, we encourage our customers to reach out to us, we actually would look at all the tracking numbers on an order by order basis. And if it was more than three days in transit, we would proactively reach out to ask if it arrived frozen or not. And that allowed us to have our own data points of basically how much dry ice do we need to pack? Was our packaging sufficient or not? What was going on with some of the networks and how we could potentially fix it? So we did do a lot ourselves manually, unfortunately.

9:02But I think for some of the logistic tools, we did use ShipStation at the time. And now we do use Fulfill.io and we use Narvar. And those have been really great and skilled with us as we've gone. With so much change on the logistics side, I know it was very important for the business to rebrand to Mila. So talk to us about the importance of this rebrand and what did you do in efforts to actually keep this connection with existing customers while reaching new ones? Yeah, so for Xiao Zizhe, we had come up with that name three or four years before the D to C side had even started or been contemplated.

9:45And it was really meant to be a brick and mortar location. And for that location, there were a lot of people who would understand what that meant, which is Street Food Avenue or Little Street Eats. it was meant for Chinese street food the way that we built it because it was an in-person experience where you could have these street foods and so then when we shifted to D2C we had soup dumplings and even within that first year we were already thinking about how do we expand our product portfolio and a lot of the frozen foods street food is not very conducive to D2C or you know freezing packing and sending it you just don't have the same experience as if you're grilling it and then handing it straight off of that to a customer.

10:32And so then we already were kind of thinking about how do we have a name that more fully encompasses our product range? Because it started as street food. We're no longer just street food. We're more broadly Chinese food. And beyond that, I think we're traditional Chinese food and capturing some of that, but we're also evolving Chinese food from our lived experience being in the U.S. And so there's going to be some influence of American palate, American flavor, you know, what we prefer as well in our foods. And so that was what started some of the rebrand thinking and conversation. So for the name itself, we really wanted one that embraced both the Chinese and the American side of us.

11:13And it was Chinese words and an English word and both that duality of being Chinese American, we want to capture that in the name. And I love the deeper meaning of the name, which is two Chinese characters, mi, which is meaning sweet, and la, which is like the spice. So it fits so well now that you're expanding, bringing in noodles and ice cream. So definitely fits so well for the expansion. On the aspect of exercises that founders might need to keep in mind when they're considering a rebrand, are there things that they should take into account to slowly transition or keep in mind to make sure the community is actually aware of this big change?

11:58Yeah. So it was very interesting because it took us over a year to do the rebrand. And so actually when we started contemplating it, we were much smaller and we felt like it wouldn't be a big lift. And then as it dragged on, then it became a bigger deal to do so. And I think first of all, for retail partners, we were lucky that we hadn't already launched our old brand. I think that would have been even more difficult to have rebranded to a totally new name. I think a look and feel that's new, that is okay. You do have to figure out hard cutovers and inventory and all of that and plan it well. But for a name, I think that would have been much more difficult if we had gone into retail first.

12:39So we first heard our retail partners very, very early on. And then we started to incorporate you know hints of Mila here and there and we did pull through a lot of the same things about the brand that make it feel like our brand so we have collage elements and that felt like a really good way to tie something that was historical vintage with something that's modern refreshing and new and so we used those collage elements before and we continue to use those collage elements even now and then for the colors we brought through the red from before to the red now. And we didn't want it to be very traditional Chinese colors like red and yellow would be the most obvious combination.

13:20So we did want to take that red, which felt like a good piece to jump off of, and then infuse that with something that's a little bit new and refreshing. So actually, when we first had our rebrand name out there, it was at Expo West in March, and we had not done any advertising with Mila yet. And people actually came up to our Mila booth and demanded to know what gave us the right to copy XCJ. And we were like, oh, okay. I mean, thank you for defending us. We are the same company. And I'm so glad that you actually can see that these are similar and related. So I think that was a lot of what de-risked it a little bit was we wanted to keep the things that really worked and felt like this was a core part of our identity and bring that through.

14:09And I love how protective the community is. Just shows how strong the brand has grown from people who support it. So speaking to that community, I would love to chat about how Mila got the word out initially through WeChat groups and Facebook groups because it is something that is rare on our show. Talk to us how the initial marketing boots on the ground kind of initiative started. Yes. So actually, my mom had formed the first WeChat group on our behalf to help us when we had the restaurant shut down. So essentially, she formed this group and pulled in all of her friends. And for WeChat groups, the way it works is you have to be in a group and friends with a friend of a friend in order to be able to connect with them and then pull them into other groups.

15:05So she just kind of guerrilla joined a lot of groups that she was connected to, and then would pull in lots of people from those groups into our group. And lots of them would accept. And that's when we kind of sent out the Google form for people to take a look at our product. So she formed the first WeChat group for us, and that got us off the ground. And then during that time, there was a lot of restaurant support groups on Facebook that were happening very locally. And so then we were able to post in a couple of those groups. And there was a lot of community support to go support restaurants that were still open and, you know, available for business.

15:43And we were able to do the Google form there. And there was a lot of support. And I think one very funny anecdote is there's an island near Seattle called Bainbridge Island. Everything there was also shut down and you have to cross a ferry to get into Seattle. And lots of people used to do a commute. And so after the ferries were not running and people were staying home, they didn't have access to a lot of foods anymore. And for some reason, we decided it was a good idea to take our car and load up a cooler of our soup dumplings and then bring it to Bainbridge Island. And we said, hey, if you can find four people who will order, we'll bring it to you.

16:21And they did that. And then we started to do weekly drops. And then it just grew and grew for this island. And by our calculations, at one point, we serviced about 10 % of the island with our soup dumplings, which is amazing. Yeah, I love that. So many parts of the story, like the support from her mom and also servicing Bingbridge Island. I think throughout all of the journey, one of the most important part for any food business is actually to stay lean because it is a business that's run on tight margins. So any advice there to make sure that you're managing your own run rate and also managing your own expenses?

17:02Yeah. So in the very beginning, maybe Caleb was the only full-time person on it, but other than Caleb, there wasn't a single full-time person on it. So we actually were all doing other jobs and also working on Mila until we got to a financial feasible place for us to work on it full time and quit our jobs to fully be on it. So that was part of how we had worked on our run rate. But also, I think we were very, very disciplined about our unit economics. So that's kind of how we started was bootstrapping the first orders. And then from there, we just kept taking the profit from those bags and then investing it back in.

17:44And the ads were very cheap at that time, which really helped us to expand a lot more efficiently. But we were very careful about, you know, being first order profitable. And so that way it could support the expansion that we had at that time. And in the beginning, we didn't have to invest too much. We didn't have very high capex. And we had limited op-ex since we weren't really paying ourselves at the time. And so we were able to use that and expand quite far with just that portion. After that, the first, I would say, step function up was when we had moved into our own dedicated manufacturing facility.

18:23And so that required CapEx. And then you had to obviously hire a plant manager, you had to hire staff that were dedicated to just this product itself. And so that was our first investment into expanding the team. Such great practical advice, and I'm excited to get more into the direct-to-consumer side and also the creative elements of the brand. But first, I'd like to take a moment to thank our amazing listeners for tuning in to the show. Shopify Masters is only possible because of your support, so make sure to follow the show wherever you're listening now and share the episode with a friend. You can also let us know your thoughts on today's episode with a review.

19:04Thank you so much. So building this online shopping experience from scratch is something that a lot of retail businesses had to do when they enter direct-to-consumer. What are some key elements that founders need to keep in mind when they do shift online? Yeah, the operations are just completely different. So it might feel like, okay, for a restaurant, we've done this at scale. We already serve hundreds of customers every single day. And so we're able to produce everything. But it is very different in terms of consistency of the product itself and then building out all of the logistic pieces and then the QA, QC for each one that comes out.

19:48I think there's a lot more understanding for something that is, you know, brick and mortar, like a restaurant where it's live, it's served live, and you see it kind of being hand done and custom made and made to order. and so you understand variation versus I think when you go DTC, I don't think there's any concept of how big something is where if you have a physical location, you can see this is the space. Here's how many customers, here's how many employees and for DTC, it is all kind of behind the screen and so all you see is the website and that shopping experience and so you don't know, is this one that has been scaled?

20:26Is it not scaled? How many people are on the team or not? What resources do they have? You know, like, are they bootstrapped? Are they scrappy? Or are they a pretty big company? And this is just like, it's worked. So they maintained that. And so I think it's just understanding really what kind of operational things need to happen to maintain that consistency as you keep going. Another part I love about Mila's website is the storytelling. And I like how you highlight the fact that based on your upbringing, a lot of it has to do with action speaks louder than words. So storytelling is so important, but yet it is also a challenge.

21:03How can brands actually thread in storytelling advocacy for their brand as they're building the business? I think a core principle of the company is always going to first principles and understanding what our North Star is. And so if we start from there, then all of our questions are answered by why are we doing this? Why are we doing this product? We're doing this company and understanding that for ourselves. And, you know, maybe it's not ready to share externally where it's been wordsmith and it's the right language. But like we have clarity around that piece of it. And so having that core of that first principle, then the storytelling becomes a little bit easier.

21:48I think it's very easy to see all of these brands are doing amazing storytelling and it's very natural to them. And they know how to tell the story and here's how they're doing it. And they've always been active and they have this voice and they know how to wield it. And for us, that actually is where we started. We were very hesitant to share because we're like, we haven't spent so many years thinking about this problem ourselves, just admitting that, you know, very honestly. And it's been subconscious, but we haven't openly explored it. We haven't concretely, explicitly stated what our position is.

22:21And so what gives us the authority or the expertise to do that? And I think once we got past the hurdle of, oh, we have to be experts on something we don't know, what can we actually be experts on? Why did we do this? And let's just start there and start to incorporate those pieces into it. That became a lot easier. Right now you have Simu Liu helping you with that storytelling as the chief creative officer. So tell us how that partnership came to be. Yes. So for our first round of investment, actually, our investors found somebody who found somebody who found somebody who had a connection, and we were somehow able to get it to his doorstep.

23:06And actually, he had left on a trip, and his parents were there. And they took the package, and they actually steamed the soup dumplings and then ate it. And then when he came back, they were all gone. and I think for him he was like oh okay well it must be a good enough product for my parents to have tried it and also finished it and left me none and so then he put in a small check as an angel investor and we still hadn't really directly spoken at that time or met each other and then over the next year I kept in touch with his management team just to share progress on the company and our products and send them things to try.

23:45And then after a whole year of this, we finally did have an opportunity where we could be in the same place at the same time and sit down for a chat. And I think neither party really had an expectation going into it. But it felt like after we sat down, there were a lot of synergies in terms of what we wanted to accomplish. I love that because I'm connecting the dots of your mom's support with starting all those groups and Seamu's parents loving the product, that parental connection. To close off the show, I would love to just get your thoughts on the whole aspect of managing influencers and food creators because I see so many of my favorite creators trying Mila.

24:28How are you growing the business now with the love and support with this new creator community as well? Yeah, so we have a few different approaches. I think there's an organic approach, which is we see people interacting with our profile already. So they're naturally already interested. And maybe some of them have already been referred by somebody else. And so we will, you know, try to get them product or have them try it, for example, or ask if they can provide feedback if they already purchased it. And so we'll just engage with them, you know, pretty naturally organically, because they, you know, it's a warm person who already has shown interest.

25:09And then I think there are specific accounts that match, you know, some of the storytelling elements that we're interested in, or the way that we do some of our videos. And so we'll proactively reach out to them, and then contract with them as an influencer to create some content with us. And then we have, again, another more organic one, which is I'll call brand ambassadors. And so these are our actual customers who are not influencers or public figures. And then we'll ask them, hey, like we saw that you already purchased our product. We already saw that you, you know, created this beautiful story about it, like a story post or a feed post.

25:46And we liked the way that you did it. We'd love to work with you over a course of three to six months. And every month, if you could just create some content that feels natural to you and the way that you would talk about it, the way that you would present it, we'd love to engage with you that way and see what you come up with. And so I think we've come up with a few different channels to try to engage with people that already know us, already like us, maybe already know us, haven't tried us, and people that don't know us, but maybe willing to try. Amazing. Well, thank you so much, Jen, for sharing all the lessons from building and scaling Mila.

26:21Thank you so much for having me on. That's Jen Lau, co-founder of Mila. Shopify Masters is produced by Gogo Zoger and Megan Coyle. Our engineers are Miku Betlam and Matt Shorts. Benjamin Gottlieb is our supervising producer, and I'm Shuang Esther Shan. And by the way, if you're still listening, please leave us a review wherever you're listening, and we'll see you next time on Shopify Masters.

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