Why Hiding Your Company’s Mistakes Could Be Costing You Sales

0:00This is the single greatest marketing hack and mindset shift that will change the way you think about marketing. Hey, how's it going? I'm Shuang Esther Shan, and you're listening to Shopify Masters, your companion for starting and building a business. Being a great entrepreneur is all about seeing major issues or setbacks as a moment of growth. This is exactly how Michelle Razavi and Nikki Elliott are building their company, Alave. They are making nutritious, high-protein nut butters and brownies that satisfy cravings without added sugars. From major manufacturing mishaps to facing countless rejections and then finally landing on the shelves of Costco.

0:43Michelle and Nikki have built up their resiliency by turning obstacles into opportunities. Michelle is here to share the strategies and learnings behind Alawi's most pivotal moments. Michelle, so happy to have you here. Thank you so much for having me. I know that Alawi started from a personal need. You wanted to have some high protein, good for you snacks. You started to make nut butters in your own kitchen and very quickly brought these products into market. Can you talk us through that process where you were starting to gather customer feedback to really refine the product as you were launching?

1:21Yeah. So we started and launched our company January 2020. So we were, you know, launching right before the pandemic. and we were forced to really lean into e-commerce and building a digital community from day one. And that was what turned out to be a blessing in disguise because it really allowed us to focus on the consumer, gather as much data as we could. And the power of digital allows you to do that at a much faster pace and scale. And so we launch all of our products and continue this day, even as the world started opening up and retail is more accessible now, to launch first D2C because it allows us to iron out the kinks, to test in a safer environment, adjust prices, play around with product messaging, and get that initial feedback.

2:10I like to say that your first draft is never going to be your final. And there's always iteration and pivoting along the way. And going in with that mindset allows you to really launch with openness, curiosity, with this humility to kind of make changes as you come back to the drawing board with a little bit of data. So that's really how we view launches, especially with products. And walk us through some of the learnings that you gathered where it actually changed the way that you were going to market the products and ultimately communicate to potential customers. Yeah. So some of the biggest things that we incorporated as we started to evolve our product positioning was in our packaging was the flavor names, the hierarchy.

2:55I think going into this business, I didn't have much like packaging or branding experience. I did digital marketing, I did sales. And those are obviously very helpful. I think every founder, you know, starting something new, you have something to bring to the table, but there's also so much to learn. And for us, a huge thing for me to learn was hierarchy, prioritizing, you know, what's important between your brand name, between the flavor name between, you know, all the different visual elements that you want your consumer to understand and for your packaging to convey. And so biggest learnings were, you know, some of the flavor names were maybe hard to understand, or were just confusing to read out loud.

3:33So we went and optimized those, really focusing on, you know, the products that sold the best instead of being very niche. We wanted to be very nostalgic and easy to understand, but also bring in that innovation too. And going for a form factor that our consumers liked. So we initially launched with our dessert cashew butter spreads in these one ounce go packs because we love the idea of being on the go and, you know, being able to be single serve. And the resounding feedback was, hey, I want more of this. I want, you know, a larger jar format. I don't want to go pack. And so that really pushed us in our innovation cycle to seek out alternate forms.

4:10So your consumers are your single best ally and really refining your product and your positioning so that you come out to market with an even better product. Yeah, and I think that's such a perfect example of done is better than perfect because, yeah, your customers are able to help you iterate and give you the learnings that you otherwise wouldn't be able to receive. I guess what would be your advice to founders who are going through that process where they feel like, oh, it's not perfect enough yet to actually push something live? What's your advice there to actually take the plunge and start iterating as you're building the business?

4:50Totally. And I want to validate and honor that it is so nerve wracking, especially with social media. You see what looks like overnight success stories of these brands. And really what's happening is just years and years of iteration. And for newer founders or entrepreneurs that are still kind of overcoming that imposter syndrome or that fear or whatever, that limiting belief or mindset about just launching and getting out there, I'd recommend launching to a smaller subgroup of like close friends or a network or coworkers that you feel safe and comfortable to really get their feedback and approach it of like, hey, I'm testing out this new thing, or I'm starting this project.

5:29I'd love to get your feedback. This is still in its initial early phase and really approach it from a data-driven standpoint and provide surveys, spreadsheets, collect data, and really just reframe it of I'm collecting data. This isn't my end-all be-all. This isn't my final product. And that ideally can help you reframe it as this is just my first draft to just get my foot in the door and know that you're going to iterate and that's okay. And people actually like to see the iteration process. And that's really how we approached it. We had our inner circle of people that we'd bounce ideas off of.

6:05Once we kind of got a little bit more data and validation, then we kind of slowly started to expand that out. And the big shift that you've done that you've mentioned is the hierarchy of how you communicated and how the packaging have changed. And I think this goes back to the big shift of focusing on the benefits of your products instead of talking about the features. Yeah. Give us a run through of how you've made this change possible and maybe some advice for our listeners that they can incorporate when they're thinking about their products as well. Yeah. This is the single greatest marketing hack and mindset shift that will change the way you think about marketing.

6:44There's features and benefits. Features is rattling off the features of your product. It's gluten-free, it's vegan, it's low sugar, just really listing out attributes. Whereas benefits is that next layer. It's a deeper, more subconscious level of marketing. We are conveying to the consumer, why is this beneficial for you to consume, to purchase, to bring into your life? And that allows you to build that emotional connection with your consumer. It allows you to tap into that purchasing decision that really allows you to go past the features, that marketing style, and really get into that benefits because the consumer is always thinking, hey, what's in it for me, right?

7:27How am I going to benefit from getting this product or service? And the sooner you can make that very clear in your marketing, the easier the sale, the better the sale, and ideally a better lifetime customer. And so we completely shifted to packaging to really educate the consumer of how our products can help benefit them versus just listing out attributes because you're then essentially relying on a customer to connect the dots versus you just connecting it for them. And that allows you to really make your customer acquisition costs go down. It allows you to build a brand more effectively and ultimately connect with your consumer for a longer lifecycle.

8:08Yeah. And talk us through that Hero product because I think you went from highlighting the blue spirulina to actually tapping into nostalgia and talking about this dessert spread, which sounds very enticing. So I feel like that shift was so easy as just someone who's listening about how the product was being described. So, you know, that hero product, the blue vanilla frosting cashew butter, it's unlike anything in the market. And I think that's what we're really excited to play with is, you know, we grew up with blue food dyes and artificial ingredients and that very 90s nostalgia time when food was fun, but it wasn't good for you.

8:49And fast forward to us hitting our mid to late 20s. We're starting to get sick from our food, looking at our packaging, looking at the ingredient label. And we're like, wow, the food industry prioritizes profit over people. And as part-time fitness instructors, corporate professionals, we knew that we were the ones that wanted to create change in our food system because it's ultimately what's responsible for why people are getting sick. But at the same time, we want you to have fun. We want it to be something that consumers would want to come back to, that moms would want to share with their kids, that kids would actually like.

9:19And so keeping that lens and that levity of, you know, fun and nostalgia while also bringing in this extra layer of integrity and clean ingredients was really key for us. And so we had to push a lot of boundaries and innovation and really push past a lot of people telling us, no, it won't be possible. And now we have created this, you know, portfolio brand of healthy nostalgia, dessert products that are also low sugar and rich in protein. And that's what allowed us to segue into our next product line that's doing incredibly well and surpassing all forecasts and expectations with our high protein brownies.

9:55They are in line with the way that we want to help consumers indulge, but also allowing you to cut your sugar intake, which is something that we're really passionate about here. Just the simple fact of labeling it as a protein brownie instead of a protein bar makes it just more enjoyable to listen to and think about. So I love that approach so much. Thank you. Yeah, it's, it's really something that took us years to get to, right? We launched with a protein bar, January 2020. And we evolved and we pivoted, we went out to market, we listened to feedback, we learned how saturated is. And, and, you know, obviously, the biggest piece of advice in the food industry is make sure it tastes good is the number one piece of advice we received, but also really make sure you stand out and are differentiated.

10:45And it wasn't until, you know, we started to sample out and get even more feedback in the field that consumers really want to indulge. People have a sweet tooth. And I think people are tired of this like diet culture of really feeling restrictive and that you can't have a certain product or that your diet is your identity. And we're starting to see this, you know, transition into consumers just wanting to eat healthier, just wanting to, you know, have a balanced lifestyle. And that's really what we're trying to do is we're not telling you you can't eat dessert. or that, you know, you need to count your macros, but really just indulge, but indulge smartly and satisfy this craving so you don't feel deprived, but, you know, with cleaner ingredients so you feel better and healthier.

11:27And the way that Alave is highlighting the ingredients with transparency, you can take a look and all of the ingredients you can actually know, I think is so amazing. And I feel like this thread of transparency is through also the way that you run the business. You had an incident with the oopsie jars and you decided to actually be very vocal about mistakes. So yeah, talk to us through kind of sharing openly about mistakes and using that a part of your content as well. Yeah. So what I find really interesting is that there is so much power in storytelling and sharing vulnerability online, especially for women entrepreneurs.

12:14I feel like we have to be perfect. We can't make mistakes, never show the struggle. And the times that we have gone viral, hit record sales is when we had a pretty intense production mistake that we call them the oopsie jars. We rebranded them. Essentially, our seal was not the right integrity that we felt comfortable selling at full price. I went on camera and one shot just said, hey, here's the situation. Here's what happened. We don't feel right charging you full price for this. That being said, we don't want to waste food either. So we're going to heavily discount these oopsie jars. And it allowed us to really build a vulnerable moment with our consumers and have this deeper connection that, you know, we're human, we make mistakes, we own it.

13:07This is a learning opportunity for us. And we want you to be a part of the ride. I think we did not expect that so many people would rally around us. We We were having influencers buy product from us, you know, customers, loyal customers that have been buying it from us for years were doubling and tripling up their orders because they saw, you know, this integrity and this heart and soul and this transparency about this is a very real thing that happens in the food industry. And a lot of times companies just toss out the ingredients and that didn't feel right to us. And at the same time, we didn't want to blow past it.

13:38We didn't want to, you know, sweep it under the rug. We wanted to be very forward facing about it. And it's very scary to do that, to put your name on a company and to come out, put your name out there and be open to criticism. It was very nerve wracking. Almost didn't even post the video. And thank God we did because it was, you know, we did a month's worth of sales in one week. And that kind of, you know, community support really validated, hey, we have something incredible here. We have great evangelists that are part of our ecosystem. We have a great product that people want. And, you know, as a brand that really helped foment for us that, you know, there is power in bringing people along the ride with you and sharing, you know, the hard times as well, because that tends to be the times when people connect with you the most.

14:27And it's truly like more engaging and also like it gives a sense of community because, yeah, everyone understands what you're going through and can get a glimpse of how to run a business. And I feel like that momentum has really helped also the both of you to enter into major retailers like a Costco. And I feel like a lot of the times that's a milestone, but it also opens doors to new challenges. So, yeah, let's talk about like the journey of getting into Costco and then also all the things that you need to do once you get an order like that. Yeah, Costco was such a massive up level for us and our brains.

15:07And I'm very into mindset expansion and getting your nervous system prepared for massive leaps. And that was just seeing a truckload of your product for the first time was something we had never even imagined before, especially when you're a very digitally native e-commerce focused brand, you're not seeing the orders all together at once. So to even see a truckload of your product all together at once and knowing that it has a PO behind it is incredible. And in terms of preparation, you know, we chatted with anyone and everyone we could. We were actually listening to podcasts as much as we could about any founder sharing their story about it.

15:44I've talked about my Costco experience on a couple different podcasts. So we really were just trying to be students, absorbing as much information as possible because Costco is a big deal. And one of our advisors and investors, who's one of the founders of RxBar, I remember him telling me this. He's like, don't F this up. You get one shot. And that really stuck with me. And so as we were preparing our palettes and being on site or production, overseeing everything, we had our hand in every single piece of that production from beginning to end. And that was the best thing we could have done because mistakes happen.

16:22And when you're working with that large of a volume, you know, things can sometimes go awry. And they did, of course, and I documented, of course, and that's great content. But, you know, we ended up successfully executing a great Costco launch. And that just builds your credibility as a brand. And that was the opportunity that we saw it with is that, yes, it's a great purchase order. It's great visibility. But it really sets us up as a brand that people take seriously. And again, as like a woman-owned business, that's not always the case. oftentimes were second-guessed and underestimated. And I'm now leaning into that being our superpower.

17:00It's great. Happy to prove you wrong. And that mindset is really now motivating for us. I'm like, great, go ahead and underestimate us. We'll prove you wrong again and again. And Costco has really just been that moment for us to feel confident in our business for the first time. Because yeah, we would always, you know, not believe our success until someone pointed out for us. But when you see your products on a Costco shelf, you're like, okay, well, we are a little bit more legitimate than we thought. So yeah, there's the mindset just to even prepare for that. But also just taking a step back and seeing your product there was fantastic.

17:35And just bringing our customers along for the journey was the best decision we could have made because it was fun. It was exciting. Everybody knows it. And people felt a little bit more closer and more bought into the brand. And then that translated back into e-commerce sales, right? Because Costco, the way it works is you're there for a rotation. It's not like you're there for the whole year. So it actually works for a benefit in our e-commerce channels because we go on rotation for a couple months at a time. And then customers who want to purchase us again, go back to our website. So it actually built some additional traction for us from an online standpoint too.

18:13Yeah. It validates all the hard work that you and Nikki has put in. And also it's like a trust seal for customers as well when they see your products in Costco. I think another part is once you get this PO from Costco, you also have to do a lot of marketing to drive traffic into the stores. So what did you do in that aspect to bring customers into the Costco stores as well? Yeah. So marketing for food is pretty integrated. Obviously you have to sample, you have to get into people's hands and mouth. So we invested a lot in our demo program and store, but when we were pitching to our Costco buyers, we were very adamant about demonstrating that we are the kind of brand that can bring in people from online into the store.

19:02Right. And that's really exciting for them is we have a very strong digital presence. And so we leveraged our email list or SMS text message list already existing from our Shopify e-commerce channel. We went heavy into content production on social media. We were also doing paid ads, geo-targeted ads for all the region locations that we are in. And we were also just working with influencers as well to go to Costco, post about our products and gifting products to anybody who specializes talking about like the newest Costco finds. We are also getting a little creative in that we would pose as moms in Facebook groups for Costco.

19:47We would post pictures pretending to be like a shop, like a Costco member and be like, oh my God, look what I just found. This looks so cool. like completely remove any mention of a lobby from our Facebook profiles and pretend to be like Costco shoppers and Facebook groups, because that's really like a great way to like discover products or Facebook groups. And those communities are so tight. So we would take any and every opportunity to talk about our products and all the different channels we could find. And it clearly paid off because we did so well. We got invited back to do an expanded rotation at double the size and record time.

20:27And it was all because of all the hard work we did in all the different channels. Yeah, it's very grassroots and you were like testing and trying all different types of channels. And I think it ties back to the fact that like the communication is clear and it stems on the approach you have with like building up customer education, which is kind of hard in this market that is so saturated. Yeah. Like how do you balance like kind of educating customers, maybe on an ingredient like spirulina, but also keeping it fun and lighthearted, having that nostalgic tie in as well when you're trying to just have one product be known to new customers?

21:12Yeah. So it depends on each product line, right? So for our chocolate fudge flavor, the one that was in Costco, that one had its own education and marketing angle. And the blue vanilla frosting with the blue spirulina had its own education and marketing angle. So for the chocolate fudge, for instance, what we learned when we were sampling was that people like to associate your product, they don't understand it with something else. And then you add on a layer by saying we're like this, but we're better because of this. So for an example, we're like a healthier alternative to Nutella, but 10 times less sugar and no dairy, right?

21:49So it's make it very clear. You maybe use a comparison of like, we're better than X because of X to allow that person on that first glance to understand. And the way I view a strong marketing campaign or message is it's simple enough where someone can then go tell their friend, right? Can they digest it and then go regurgitate it? Because you want that word of mouth, that viral marketing to just take off. So that's how we view it. And when you think about the psychology of marketing, people can digest one to two, maybe three max messages at a time. So in all of our marketing, both in demos, online, influencers, we were coaching everyone to say one to two bullet points max, low sugar, dairy-free, or high-protein this, or naturally blue from blue spirulina.

22:36So we kept it very simple. My favorite acronym is KISS, keep it simple, stupid. And that has really transformed the way we do our marketing because as founders, you want to just word vomit onto everyone how amazing your product is and people can't absorb all of that. And the second we took a step back, we're like, okay, what are people playing back to us? What is someone saying to their friend? And how can we just really strip apart all the noise and just get to one or two key messages. And you have to be okay with that, that not everyone's going to understand your entire mission, your story, or how great your product is.

23:13But if you can get them sold on one message or one idea, that's enough just to even get the product into people's hands. So for the blue vanilla frosting, for instance, the number one question we get is why is it blue or how is it blue? That must be fake. And so the message for that is it's naturally blue from blue Spirulina, which is a superfood. And so it allows us to really focus and prioritize on the right messaging for the right product. And the way we got to that is by sampling, being in the field, asking people, what is the number one question? What are they confused about? What do they want to learn more about?

23:49And we would also put a lot of content online and notice and keep track of data of what were people asking about? What was a frequently asked question? Looking at our Amazon reviews, looking at our Shopify reviews. What are the patterns that we're seeing over and over again? And that pattern recognition, the way we look at our data also helped us inform what is the right market and the positioning for each product based on the questions we're getting. Yeah. Nothing like immediate feedback to grow the company, develop products, and also just build up that online community, which I think you're doing such a great job at balancing both your own account and a Lave's account.

24:29And it is at this day and age where founders have to be at the forefront. I guess like how do you balance everything where there's a whole company to run, also the social channels and your own mental health while you're balancing all those channels at the same time? I'm really glad you asked this because this is something I'm personally trying to set boundaries on myself because it's a lot, right? Five, 10 years ago, brand founders weren't expected to have a digital brand and a digital presence and to be what feels like being always on, right? And you have investors follow you, you have customers follow you.

25:08Sometimes customers are DMing you customer support questions. And so I've learned you have to set clear boundaries with technology so that you can keep your mental space protected. What I've started instituting is a Saturday detox. So I completely log out of all my social accounts and give myself that break on Saturday. We pre-plan or post. So content batching is a fantastic tool that I've learned from content creators to really build out your content in advance and kind of schedule them out, brought on some support for having someone manage our social media where I pre-send them content and they manage the back and forth with customers now that we're a couple of years in.

25:44And then for my personal brand, you know, it's a balance and it's, I'd be remiss to say that it wasn't hard where sometimes I'm really exhausted and, you know, I feel very beaten up from just the day to day of putting out fires and to go online, it's, it's exhausting. And I'm starting to have a little bit more grace with myself because yeah, it's, I'd rather not take a break and not show up online versus like show up inauthentically or do so in a way that drains me from the business. And I would say, yeah, like having a repository of content that you could just resurface is a great hack. One of the best pieces of advice from my angel investor Tori Dunlap, who I know was on this show, is that it's okay to repost and reshare content that did really well.

26:30I think we think, oh, no, someone like one person may have already seen it. Like, it's going to be repetitive to post it again. She's like, no, like nobody remembers. And it's so hard to reach people nowadays anyways. chances are it's probably going to still be the first time someone sees it. So repurpose your heavy hitters, your strong pieces of content again, to give yourself that break. So you don't feel like you have to constantly churn out new content because we're not content creators full time. We're business owners, we're entrepreneurs. But I will say, you know, having that community, I'm glad we're investing in that digital community because, you know, it's, it's so rewarding and validating when people are sharing, you know, them using our products and reaching out and telling us how much they love it because those are actually the most energizing moments.