Proven Ways to Improve Customer Retention and Boost Loyalty

0:00We spend no advertising dollars on Meta, on anything. I have just always truly believed that if you have a wonderful customer experience and a superior product, people come back. I have always felt word of mouth and loving on your customer, turning them into clients, making them friends. I find those are the advertising dollars I'd rather spend. Hey, what's going on? I'm Schweng Esther Shan, and this is Shopify Masters, your companion for starting and building a business. Sometimes businesses can be born out of your interests and the things that you love to do. For Catherine Oyer, she found herself shopping for baby clothes when traveling long before she became a mother.

0:45Catherine noticed that the brands she found abroad were missing distribution in the States, so she launched Francis Henry, a modern curated shop for little ones. Frances Henry sells online and recently opened its first retail space and sales more than doubled. Catherine, welcome to the show. Thank you. I am so thrilled to be here. Very, very happy to have you. I love the way that Frances Henry was started. You were traveling a lot. You realized you were collecting baby clothes well ahead of becoming a mother. And you noticed that your favorite brands weren't actually available in the States yet.

1:27Talk to us about taking the first steps of mapping out this business idea. I had two kids and was pregnant with my third. And all throughout that time, I had been, you know, Pinteresting and saving all of my favorite baby brands and continually looking to see if I could get them without having to ship them overseas. And it occurred to me, finally, the light bulb moment happened that I might not be the only person who was wishing that I could have access to these wonderful baby clothes and being pregnant and, you know, feeling very inspired. I ordered a handful of things from overseas and, you know, one particular package that's one of my favorite baby brands that we carry here at the store.

2:16It took six weeks to deliver from Australia. And I thought, this is it. Like, I can't, I can't have this happen. You know, kids grow so quickly that in six weeks, kids will be the next size. And this is in 2020 during the pandemic, if you'd like me to start the whole story. Yeah, of course. I mean, this is like the precipice, right? We're having a lot of time at home. You had this business idea for so long throughout all the years of traveling. So finally you decide to put the steps into motion. How did you go about convincing the first brand to actually work with you? Sure. So to lay the stage, it's 2020.

2:58We're quarantined at home. I was working full-time at a corporate job. I was at home on the computer all day. My husband was on the computer all day. We had two toddlers and I was pregnant. And I was going a little crazy of having my days feel so full. And I decided I really wanted to have a project. And so I just decided to hop on Shopify and create a website. As I was just doing this for myself, it was just for fun. I was not planning on even telling anyone. I don't even think I told my husband that I was doing this. And I thought, you know, I'm eventually going to start this business. I'm going to have to know how to reach out to brands.

3:40So I reached out to the brand that had taken six weeks to deliver. And I introduced myself and I said, hey, you know, I have a background in luxury retail. I'm starting an online store for moms like me who love your clothing, love these international brands. But frankly, six weeks is too long to get things. So I want to be the place to, you know, I'll hold the inventory and then they can come shop with me instead of shopping and ordering from you. I still think back to that. And I mean, they obviously didn't know that they were the first brand that I was reaching out to, but they said yes, almost immediately.

4:17They said they loved the idea. They had very low distribution in the US and they were open to starting a partnership. And I couldn't believe it. And then part of me thought, I probably shouldn't have done this when I was eight months pregnant, but the ball was rolling. And so that was the first brand. And then I had one other brand that I thought, okay, I've got one yes. Maybe I'll just try one more and we'll see. And they said yes. And then I thought, oh gosh, I'm going to have to tell people about this. I'm apparently ordering inventory. I think you were very smart and tactful in reaching out into the brands that you loved and also convincing them to give you a lower minimum order quantity is tough.

4:59How do you make sure that you illustrate the vision that you're trying to build and also convince the partners to take a chance on you and perhaps order a smaller quantity? I will say I got a little lucky in that department when I first launched. So in the children's retail market, much like adults, things, you know, if you think about Fashion Week, Fashion Week, they show designs that don't actually hit stores for another half a year. So children's is just like that. You know, we order six to nine months in advance. So when I reached out, it was in the summer and I thought, oh, I'm going to launch this business in a month.

5:38I'd like to order some clothes. And they thankfully didn't laugh at me. I think they could tell I was new to the industry. But they said, you know, we unfortunately all of our orders are closed, but we have these things called immediates. So it's clothing that they ever overproduce or if an order gets canceled. Sometimes they keep a little bit of stock on hand. And they said, you know, we have these immediates that you're welcome. to kind of take a peek through. And if there are sizes that you're interested in, you're more than welcome to buy them. So it almost kind of felt like I was taking things off their hands.

6:11So they were certainly more open because these are items that they need to sell, and maybe they're not necessarily selling direct to consumer. It's kind of they're waiting for their wholesale partners to buy them. So they said yes, and that kind of gave me the opportunity to buy much smaller quantities. And a lot of these brands too are smaller. And so we've brought in a lot bigger brands now, but some of the smaller guys, you know, they're just excited to find a new retail partner. And especially if it's someone in the U.S. where they're not distributed, they were just kind of thrilled to have more distribution to more families.

6:42You definitely also have this really great corporate career before becoming an entrepreneur. You worked in public relations for Neiman Marcus. And I feel like also the way that Francis Henry is put together, there is a vision that you have. And I think when you're curating, that is the toughest task. So if you were to give advice for founders who are potentially thinking about the curation route, what's your advice for selecting pieces, but also having a holistic, grander vision for your brand? So when I first launched, you know, I had huge dreams of covering every category in the children's world from home to gear, strollers, car seats, clothing, toys.

7:32I mean, there is so much that I could go into and I really had to force myself to bear it down. And really part of it was looking at the market. I find that so many children's stores focus so heavily on toys and accessories, which is great for gifting and it's great if you need something for a baby shower. But again, my problem being that I wanted to dress my kids and I could not find anywhere to shop. I felt the biggest need in the market was clothing. So that's how I started to approach the business, you know, clothing first. And when I first launched, even before we had brick and mortar, it was clothing only for two full years until we opened the store.

8:13And then I started to expand categories after that. We have a joke here at the store that someone needs to stop me from expanding categories because I keep going into other areas of the business and I'm like, I just need to focus on clothes. But when it comes to curating, I've found that if you're in a physical space, obviously it needs to feel more like a world that you're walking into. I think when you have an online store e-commerce, it's a little bit easier to be more siloed in one area, or it just makes it easier to kind of fill a room, fill a nursery. You know, we just expanded into like a little tiny bit of like celebration party supplies.

8:50But I'm a mom and, you know, I kind of know what I'm looking for. I need shoes. I need toys. Now we have like bikes and helmets as kids are getting older, little toddlers. And so as I'm curating, I'm just kind of trying to serve the families that buy from us in all the areas that I find as a mom, things are lacking. here in our market. Yeah, that's great advice because you're curating with moms in mind and families in mind and how they grow and expand and celebrate different milestones. So of course, when others look at people's careers, they might think, wow, like a PR position in Neiman Marcus, that's someone's dream job.

9:31So how did you make that decision to say, well, now I'm going to focus on Francis Henry full-time, and I'm actually going to quit my job. So, you know, my hand was forced a bit. I will say that was a dream job, you know, being on the corporate PR team at Neiman's, and I probably would never have left. I loved it. The team's amazing. I mean, the opportunities to meet designers and plan fashion shows and do so much. But the pandemic, you know, that's, this is the reality of that situation. I was pregnant with our third baby, as I mentioned. And when he was born in fall of 2020, when my maternity leave was coming to an end was, you know, very early January, 2021.

10:17And the company had a procedure in place that we were all being called back to the stores, all of the executive or corporate positions. Any of us who had an office in a store, we needed to be there full time. And it was really tough. I mean, nowadays, hybrid workforce is so common. But, you know, January 2021, people weren't really doing that quite yet. And between my husband and I, we both worked full time jobs. And there was no childcare. I mean, the community we're in, there was no daycare, no preschools were back in, everyone was virtual. And, you know, We stopped short of rock, paper, scissoring who was going to quit their job.

10:55And unfortunately, or fortunately, it was me. So, you know, and I stayed home with our kids and worked on this on the side. And I think there's so many other mothers and women who found themselves in this position during that window of time. And I feel very grateful that this kind of came out of that. In hindsight being, I think it all worked out how it was supposed to. But it was tough, especially as an entrepreneur and not wanting to put too much pressure. I've started other businesses in the past, and I always really listened to the advice. Don't quit your day job because it puts so much pressure on your business to then have to fund the rest of your life.

11:35And I always really felt that that was important. You know, make sure that you're not having to make sacrifices or do things as a business owner you wouldn't do because you're trying to feed yourself or pay rent. But in this case, that's just how it happened. It sounds like there's combinations of just how work was setting up and also the different chapter in your life. But you did also make the business work and have a smooth transition into the entrepreneur chapter. For someone going through similar transitions, what are some things they can do to ensure that it is a smooth process? So I think that I tried to set myself up for success as much as possible.

12:22You know, when the business first launched, it was e-commerce only. And as in the coming months, you know, it was during the pandemic, but also even if it hadn't been, my goal was always to start opening brick and mortar stores. You know, it's like we have one now, the goal is to have more in the future. But that first bit of time, I recognized that was not an opportunity I was able to pursue quite yet. So we were e-commerce only. I was shipping from my house. All the inventory came to me and I kept the business small enough that I could manage it. So currently, you know, we have clothing for children, newborn to 40.

13:02So it's like four or five-year-olds. so just babies and toddlers but when I launched I launched just newborn to two so it was like very niche kept focus but also kept it manageable that I could tend to that you know I didn't think that I was going to be able to sit at home and ship boxes all day so I needed to keep the business a little bit smaller and then as it began to grow and I was doing in-person pop-ups I would take them but it would be maybe one a month you know I wasn't doing it every week just because of the life that we were living. I just wasn't able to give that much of time to the business until, you know, the world opened up a bit more.

13:39Yeah, you're growing at your own pace and at a rate that felt natural to you. And I think what was great is even in the beginning, you didn't have a technical training, but you were able to build the online store yourself. Any advice there for people new to building their Shopify stores? How did you ramp yourself up to customize and build out the dream store you wanted? This is definitely a Shopify plug. It was so intuitive and simple and so fun to put together. You know, I spent so much time looking at different templates I could use, different themes. And when I finally found one, it kind of felt like the pieces kind of fell together.

14:26The nice thing about the industry I'm in is brands will provide photos. So I think that's kind of the biggest step in the right direction of making your website look nice. I use Canva to do any kind of logo design I needed, any kind of brand design. I worked with a graphic designer and an artist that I found on Etsy. Again, this is all just things that I was night, very hobby-esque. So I was like trying to keep the cost low. So anything I could do to kind of do it on my own and then ask questions, I felt like I kept the website pretty minimal. You know, it's like I needed products. I needed a way to organize it so people knew how to shop it.

15:08And I needed some great photographs and it kind of came together. Yeah, love it. And I think to your point, that is a great way to save costs, especially as a new business, you need to make sure your own cash runway is well managed. Where were some other things you did to stay scrappy in the early days? The customer experience is so important for me. So the things that I will not cut corners on are things like we send a handwritten little thank you card in every package. It's like, I wanted the experience of receiving a box to be almost like a gift, regardless of if it's a gift or you're just ordering for yourself.

15:52And so things like, you know, we have specialty tissue paper and we have the cards on the inside and like the stickers we use are all special. But the things that I'm very willing to cut corners on are things like the shipping boxes. You know, we use craft boxes, even the bags in the store till to this day, we use craft, like very nice, like Euro tote craft bags, but they are not specific to the store. I mean, those things I felt didn't speak to our brand. I wanted the experience to be very high end, but there were certainly areas, white tissue paperwork's great. I didn't need it to say Francis Henry.

16:30So there were certainly areas to cut costs on certain things and not cut costs on other things. Also not hiring someone to do the website or the graphic design for the actual logo. I did that all myself. Because I always figured, you know, long ago, I worked at a tech company at a startup, and we always focused on MVP. It's kind of like, get it out there and you can update it later if it really needs updating. And I had this ticking time bomb of needing to launch before my baby arrived. And so I, once I started getting these yeses from these brands, it was, all right, it's go time. I got to get this done and I need to get it now.

17:07Yeah, a natural deadline was implemented right then and there. Yeah, and even for Shopify, we have this platitude of saying done is better than perfect. So I think that's so important. The other benefit of launching early is that you can start collecting feedback from your customers. And there's data from your customers as well, which is something you've used to help decide what to do next for your business. So talk to us about analyzing the data and making decisions on the business. Sure. So I am constantly in the numbers. I am always pulling reports in Shopify. I love to see where we've been, where we're going.

17:50I always think it's interesting to see repeat customers coming back and kind of what they're buying, how often they're coming back. I've certainly, you know, we look at the top sellers for sure, which sometimes is tricky in clothing because if it's a top seller, typically we can't get any more of them, which is sad from season to season. But certainly things like toys, the shoes, like certain styles of items that people really love, we're starting to realize we almost have a collection that we're starting to call essentials because it's just season over season. People ask for it. They come back.

18:25They're buying it. It constantly sells out. And then, And of course, being able to sort in Shopify by vendor is so interesting to see the sell-through of certain brands we work with and then certain brands that just don't seem to translate as well. You know, things that I love that apparently not everyone loves, but just very few and far between. I mean, for the most part, all of our brands are great. And I'm sure data analytics really helped when you opened your first retail store, which we're going to chat about very soon. before we do that i would love to take a moment to thank you our listeners for tuning into the show wherever you're listening make sure you're following shopify masters and write us review we love reading them and incorporating your feedback thank you so much so you decided to open a retail store and this is a good investment especially with your experience with all the different pop-ups.

19:23What should founders think about before committing to a lease and opening up a physical location? I think location, everyone says it, location matters. But I also think there are certain things about a location that matter depending on what business you're in. You know, I serve as moms and families with kids and strollers and the location that we're currently in. We're actually at like one end of Main Street, which some people might look at and say, oh, it's not like in like the main heart of the downtown. But on the flip side, we have a parking lot. You know, we have a back entrance, which pretty much has now become a front entrance because everyone parks in the lot and brings their stroller in that door.

20:09And I have heard so much feedback from the rest of the town that it's very hard to park and to get into any of their stores. And so I think parking is huge and should be a number one consideration if you're looking at opening retail. We also have an opportunity. People can pull up and we do curbside pickups at times. You know, if there is a mom who has a sleeping baby, we'll get messages that say, can you just run my bag out? Because we do like buy online, pick up in store. So that has been fantastic. But also things, making sure the numbers work. I mean, this was a huge leap between being online and doing in-person pop-ups.

20:50I mean, I certainly had the understanding that the products sell much better in person because people are seeing the quality, they're holding them. I mean, when you hold up a shirt for a three-month-old and it's, you know, teeny tiny, it looks so cute. And there's that moment, pulls at your heartstring, that it doesn't quite do on a website. Right. But to invest in having the inventory for brick and mortar and being able to fill the space, I mean, it was a huge investment and I needed to make sure that the rent, the lease, you know, all of the terms were something that I felt like we could hit, you know, in the short and the long term.

21:31So I would say, you know, the point that we're at now, I feel like landlords kind of go back and forth, but I always try to recommend people who ask me that they're looking for space to just really talk to the landlord and find out what terms they're comfortable with. I mean, we were lucky to get a bit shorter of a lease in our location than the typical 10 to 15 years because that freaked me out a bit at the time. Now I feel much more comfortable with doing that. But as we kind of thought about this, hopefully it's going to be the first store of handful of stores. I wanted to make sure that we had the opportunity to kind of move a bit if we need to into a location that might be bigger or, I don't know, more accessible, or if we do expand to a collection with gear and need more space.

22:21Of course, opening a retail store requires more financial investment. Where were some of the things on your checklist to make sure that you were ready and able to open a retail store? At least from our business perspective, like having consistent sales, getting to a point where not that I could know how much was going to come in month over month, because obviously in-store has been much higher than just online, but just having consistent sales where there were people who were not just friends and family, who were strangers on the internet buying things and seeing that there was traction that I could actually map.

23:00Not only that, but also understanding what the keep the lights on amount was before I opened the store. So it's like, what is the amount that we need to be making to keep the lights on in the building? And having that be the absolute bare minimum that the brand is bringing in. When that was a number that I was comfortable with, I thought we could hit that. And then anything else, cherry on top. So that is kind of a number that it's going to be different per business. I opened just as myself as the one sole employee working the store. So obviously that was like a very negotiable rate as a founder.

23:39And I just wanted to make sure that I could, you know, pay my vendors, pay my landlord, pay the electricity, and then absolute bare minimum. That's definitely not the amount you need to keep a business afloat for years and years, but at least to open the business. And I thought if I could keep this number for a couple of years, we can have a go at this. And it sounds like this is kind of the full circle moment, right? When you started, you were growing at a rate that you were comfortable with and that is manageable, which is very practical advice for a lot of people. So opening a retail store, I feel like also complicates your inventory management and your forecast and managing just the sales from both online and in-store.

24:22How did you adjust to make sure that everything was running smoothly behind the scenes? I had the assumption that it would at least double, if not triple, once the store opened. and when we opened the store, funny enough, again, making a mistake on my end, I went into market assuming that I was not going to open a store because I had seen a few locations, they had fallen through, I was not finding the right spot that I wanted to be in, and so I thought, you know, when I'm planning out, it was January, I thought, okay, next fall, I'm not going to open a store. We're going to still do pop-ups for the rest of the year, and then I'll look again in a year for a location and then I can triple buy my inventory.

25:12And of course then, as soon as all my orders are in, everything's done, April of that year, I found this location, fell in love, knew it was the spot, signed a lease almost immediately and then started to scramble as much as I could, recognizing that I ordered so little inventory. And for the most part, brands, they'll do the best that they can, but I was emailing everyone I could, you know, begging, pleading to up my orders, but also trying to not overdo it. I mean, I assumed that it would be successful, but we're also not in the most giant trafficked area. So it was a little of both. It actually kind of worked out.

25:53There were some brands that told me, sorry, like we can send you what you ordered. And unfortunately, all of our orders are in production has begun. You're good. And then there was a handful of brands who said, no problem, like we can double your order. We'll get it to you. And then, you know, when the store opened, it's certainly more full now, but I kind of gave myself the grace, the understanding that done is better than perfect. And as long as I knew the inventory was covering the money that we needed to be making, I just thought, you know, we'll work these levels out a bit more as seasons go on.

26:30And that really was a repetitive comment that I kept saying to customers through that first holiday season, and we were sold out of so many sizes and so many items. And I just kept saying, you know, we're new to this and, you know, our inventory levels will get more established and leveled out. I was shocked at how fast we were selling out of things. I will say a plug for FAIR at the time was great because we were able to order a lot of immediates from FAIR for brands that had pieces that they also were not trying to get rid of, but needed to sell. And so it was a bit of a scramble. Thankfully, things have mostly leveled out.

27:09Very glad to hear coordinating with different suppliers and partners have helped you to open the retail store. And I'm sure that data analytics became even more fascinating because you can have a more holistic view of customers shopping in-store and what they also buy online. Talk to us about some new learnings from analyzing both in-store and online data. I have loved having both Shopify, the e-commerce and POS, you know, combined inventory is incredible for the team and I. I mean, we process all the orders here in Westfield. We ship from this store. And so to have everything in one place to look at and the analytics on that are fantastic.