Today on the More Cheese Less Whiskers podcast we're talking with Jonathan Pantalis from phikind.com the organic, sugar free chocolate people.
Chocolate the favorite thing of everyone everywhere, and if you love dark chocolate, this is going to be an exciting conversation because they've got a really great business and there's a lot of lessons here about focusing on the customer experience.
We spend a lot of time talking about the first time somebody tries their chocolate, and the first 60 day experience to encourage them to reorder more chocolate and join as a recurring ongoing client.
They're doing a fantastic job. People love what they're doing, and as you’ll hear, they love the story.
Show Links:
ProfitActivatorScore.com
BreakthroughDNA.com
EmailMastery.com
Want to be a guest on the show? Simply follow the 'Be a Guest' link on the left & I'll be in touch.
Download a free copy of the Breakthrough DNA book all about the 8 Profit Activators we talk about here on More Cheese, Less Whiskers...
Transcript - More Cheese Less Whiskers 132
Dean: Jonathan.
Jonathan: Hey, how's it going?
Dean: I'm good. How are you?
Jonathan: I'm doing really good.
Dean: So Jonathan, where are you calling in from?
Jonathan: I'm in from Santa Rosa, California. It's an hour north of the Bay area.
Dean: Santa Rosa. Wow. Are you seeing all the smoke and everything, all the after effects of all the fires?
Jonathan: Yeah. Yeah.
Dean: Really? It's gone all the way up there, huh?
Jonathan: Yeah. Last year we had the fire that came through here. I actually lost my home and so now I'm feeling for the people because it's smoky here, but I mean for all the other people I mean, man.
Dean: Oh no. That's amazing.
Jonathan: It's something.
Dean: Well, I'm glad that you're out of harm's way. We're here to have some evil schemes here.
Jonathan: Yeah.
Dean: So I'm looking forward to the conversation because I know a little bit about what you do, but I'd love to have you kind of tell the story here and where you think we'd like to focus our attention today.
Jonathan: Definitely. So we make a sugar free raw chocolate. As far as I know, nobody does everything that we do all in one place, so we make a sugar free organic raw chocolate for people that want to eat less sugar for really any reason, but-
Dean: So you sell cardboard? Is that what you're telling me?
Jonathan: Cardboard. It's-
Dean: I'm just teasing you because you know all the things that typically people think when you take out the sugar and you take out all the stuff, and you call it chocolate, but I know that you have a gourmet, wonderful latronic, so I was just kind of teasing you there.
Jonathan: Yeah. It reminds me of those memes that are like gluten free, organic, dairy free meal, and it's like a plate of ice.
Dean: Yeah, exactly. Right, right. That's funny.
Jonathan: Yeah. Yeah. Yeah, no, but that's about it. We use non glycemic stuff, but we also grind our own cacao that we get from all over the world. It's actually a very powerful super food when it's not processed in the way, the more modern traditional way, if you will.
Dean: Right. So what rave reviews do you get about it the most? Is it really tasty?
Jonathan: Yeah. So that's really it. I mean, we get people everywhere from people that haven't eaten sugar in years that are just thrilled that they can have something that they can enjoy, but the other thing is people that were into like really high end chocolate that stopped eating sugar, and they miss it.
That's where we fill in because we're not just a sugar, there's a lot of sugar free chocolate out there. It's a very competitive business. But no one's doing it to the tune that we are where we're really refining it, really you're going for more single origins and getting sourcing from single countries and all that.
Dean: Yeah.
Jonathan: So the feedback is everything from naturopathic doctors that are thrilled they can recommend something to their patients, to individuals. We had a recent one, it was a mother. She was a doctor herself, and then she had an autistic child that they got off all sugar, and it was really improving things for them, and that was the one sweet that they let them eat. So we get stuff like that, but then it's also people that have diabetes or something like that also.
Dean: Right. So it's for the people who can't eat anything else, this is really a perfect thing for them. Right?
Jonathan: Totally. Totally. Then there's just people who are just eating a ketogenic diet for maybe they are body builders or they're doing the coffee thing, that whole thing. There's people that are in that niche as well.
Dean: So it's keto compliant too?
Jonathan: Yep. Yep.
Dean: Okay.
Jonathan: That was sort of my motivation for it for creating it was that. It's where I went with my own way of eating. Stopped eating sugar.
Dean: Okay. Keto has really gotten a publicist in the last couple of years, that whole... it's become very, very popular.
Jonathan: Sure has. Yeah.
Dean: Yeah. So that's the buzz now. So, what's the primary thing that you sell? I know you have a whole range of different things, but what's the primary staples?
Jonathan: So yeah. Primarily, it's our truffles.
Dean: Okay.
Jonathan: We have truffles that have MCT oil and all this great stuff in there. Then we have bars, but I would say our primary is our truffles. It's just hands down because they're the most unique.
Dean: And you sell direct, or through stores or restaurants?
Jonathan: Yeah. So when we first started, I say when we first started, but it's been four years of attempts and two years of actually making it. Right? We started off wanting to only sell in stores like wholesale to grocery stores, and thank goodness we found the internet and we decided to go direct. It was kind of by accident, but the whole reason I found you and all the wonderful information. we started the online website. We found out that people actually wanted to buy chocolate online. We didn't do any marketing for the first month or two, but people just found us through organic reach or whatever, social media and stuff.
Then I was like, "How do we kick this up?" Now we're in like 95% on line. We've still in a couple select stores, but it's not a priority anymore where it used to be like our main focus.
Dean: Yeah. Okay. So you're really one of the great things here is selling direct online gives you so much more control. It's such an easy thing you got a long shelf life. You can ship easily. It's not that expensive to ship. So it's so many great things going for it that that's a smart move. Now, what I'm interested in is how much of your business is what we would call after unit business, meaning repeat?
If I were overlaying the model that we have, the A profit activator, so if I were overlaying that on your business here, I would consider everything up to the time somebody makes their first order as your before unit. That first order experience there being your during unit, and then the repeat business being your after unity.
So how much of your business right now is repeat business?
Jonathan: It's grown to about fifteen, twenty percent at this point. To be quite honest, the whole summer we weren't doing anything to communicate with our customers, like to bring them back, remind them that we existed.
Dean: Right. Right.
Jonathan: And about three months ago, we started sending emails again, right? And we had people that were literally like, "We haven't heard from you in so long!"
Dean: Right.
Jonathan: Well after that, once we started sending just four emails, not necessarily to sell, a month, we've gotten it back up.
Dean: Right.
Jonathan: The first month, it was twenty percent. And now that we're sending them regularly, we're around seventeen percent, something like that, I think right now is about what we're getting.
Dean: Yeah. Listen, this is where all of the value is going to build in your business, is building this as a brand with repeat with customers that continue to buy and buy again.
Do you have any continuity programs? Do you have any chocolate?
Jonathan: We do, we do.
Dean: Okay, good.
Jonathan: Yeah, we just started that in July, and that's been the most profound thing. That's why this, well I'd say revenue and profitability, this is going to be probably our best month we've had because we've been accumulating since July.
Dean: Yeah, right.
Jonathan: We've created a subscription box where it's only chocolate that you can get in the box, it's not sold anywhere else. It's specials made every month that are attuned to the season.
Dean: Yeah.
Jonathan: And once they're done; they're done.
Dean: And you got a story around them and all of that, that's great.
So and you've got the baselines then of sugar free and raw and all of the good stuff that it's got going for it.
And how much does your average customer spend? What metrics do you track here?
Jonathan: Yeah, we track our average order value for first time, and then repeat customer average order value, I would say I think it's around in the eighty dollar range.
Dean: Okay.
Jonathan: I don't remember but it's in the eighty dollar range. And first time is about fifty dollars.
Dean: Okay. So here's the thing that what I would suggest looking at the metrics here, is that once somebody buys for the first time, you've got now a visible client. You've got somebody who is familiar with who you are, they've experienced your product, they either love it or they don't. And some people probably love it; some people might not, and that's okay. But they've tried it.
Jonathan: Yeah.
Dean: And the ones who love it will continue to come back. And hopefully you've got a product that more people love than don't.
It's something that people often eat just because it's not a meal replacement, there's no preparation, it's very easy to slide chocolate into somebody's life, right? In so many ways.
So there's so many good things going for it that I think that the real, real value of your business if all after unit. It's all building this list of people who have tried it.
How many people do you have right now that have ordered from how? What's your customer count, would you say?
Jonathan: I want to say it's about twelve thousand.
Dean: Okay. So here's how we look at it, that of those twelve thousand this is a metric that I would be looking at here. This is knowable because it's happening right now, whether you're measuring it or not, is that you've got twelve thousand people who at some point gave you money for chocolate, right? And sometimes with a first order, and never again. Sometimes then they bought again, and that's all we're really looking for, is how can we get that number up.
Would you have a sense of how many of the twelve thousand have made a second order?
Jonathan: Yeah, I want to say it's about three thousand if I remember correctly.
Dean: Okay, so about twenty-five percent, right? If we take it like that. And on an annual basis now, one of the things that we want to look for is the asset that you have is this group of people who know you and have experienced your product. The measurement that we want to take is what is your return on relationship?
By that, we want to measure it in two different ways. This is what Profit Activator 7, Nurture Life Time Relationships and Profit Activator 8, Orchestrate Referrals are all about.
So we want to measure two things. There's two ways that we get a return on our relationship with our existing clients. Once you've got them now, by and large, it doesn't cost them anything to communicate with them now by email, right? By email, by text, or by Facebook, however they're in your world there.
But you've also got the opportunity to, because you're shipping product to them, you know their physical address, as well. So you could do direct mail. But the thing that we want to measure as a percentage is what number of the twelve thousand came back in the last twelve months? So we're looking for our annual ROR, or return on relationship.
That means that of a hundred percent of the revenue that you've done in the last twelve months, some percentage of it has come from people who were already in the family, right? People who were already on the books.
Jonathan: Right.
Dean: That number, if we're saying that of the twelve thousand, if it was twelve hundred that have ordered again in the last twelve months, that your return on relationship, the baseline would be ten percent, right? You have a ten percent return on relationship there.
Jonathan: Gotcha.
Dean: Now what we also want to measure is how many people did they refer or introduce to your product. And I don't know whether you've got a systematic way of doing that or even a way of tracking it or measuring it. But there's an opportunity there as well to track new customers that were introduced by your existing customers.
Jonathan: Yeah. Yeah, I know that's happened. But when I did the score card, that was the one I scored very low on that part.
Dean: Right.
Jonathan: Because I haven't thought of a way to track or I guess I could do an affiliate program, which we do have, but haven't put a whole bunch of effort into.
Dean: Yeah. And you don't need to monetize it. It doesn't have to be... most people are not going to be interested in an affiliate program to introduce chocolate to their friends, you know?
Jonathan: Totally. Totally.
Dean: Certainly there are going to be strategic business relationships where people can refer people in mass to you. But the average, the twelve thousand people, what we want to capitalize on is people saying, "This chocolate is so good, you've got to try it!" Or whatever.
It's happening; they're telling people about it. They're letting them try one of theirs. But then when they go home or leave that situation, they're not then coming to the website and ordering the chocolate, right?
Jonathan: Right.
Dean: But if you had a gift card that you could give to your clients to give to their friends that they're introducing it to, because chocolate, if it's in a big bar like that, chocolate is one of those things that is easy to share, right?
You're predominately going to feel good that you're sharing chocolate with somebody. If you open up chocolate at work, you're all of a sudden the most popular person in the office, right? Or in the meeting, or whatever.
Jonathan: Yeah, yeah.
Dean: Yeah, you're sharing love that way, right? But if they had a way of introducing people that you could monitor, track, that would be a good thing.
I see it like all referrals happen as a result of conversation. That in those conversations, especially people who are consuming chocolate, they're consuming your product, they're probably consuming it with somebody else, you know? The good chocolate.
Jonathan: Definitely. Definitely.
Dean: Yeah. So the conversation is going to come, and I imagine that they're saying great things and people are saying, "Oh, I love that!" But then you don't know who they are unless they then connect the dots and come on the "How did you hear about us?" box on the order form telling you that they were referred by a friend.
How do you track it? How do you track it now?
Jonathan: Well we'll get an email every once in a while from a customer that's like, "I just told all my friends." That's about it. We don't have really any way of tracking it, quite honestly.
Dean: Okay. So there's a big opportunity for you, because that's where the majority of your business is going to really thrive there.
You want to really capitalize on that after unit. The goal, of course, of the during unit is once somebody makes their first order, Profit Activator 5, that's the Core During Unit, right? When they order, the get the chocolate, the unboxing, that first taste in their mouth, that confirmation moment, that's the time that you either hook them or they're like, "Ah, that's not like a Twix bar." Some people, that's what's going to happen. And what you want to measure now is by instituting something in Profit Activator 6, some After Sale Service here, some after sale focus with a goal of graduating people to that second order.
That second order is what catapults somebody solidly into your after unit.
Jonathan: Got it, got it.
Dean: So what-
Jonathan: Yeah, I like that.
Dean: Yeah, the measurement of it would be how many do you graduate, right? So if you say that right now you've had twenty-five percent of the people make at least that second order at some point. And I don't know whether that's accurate, that was your best gestimate, I think, from what you told me.
But measuring that is in that first sixty days, if you made a focus on it, what would be the graduation rate, the success rate of getting somebody to make a second order?
Jonathan: Right.
Dean: That would be a valuable thing.
Jonathan: Definitely. Definitely. Yeah, because I've looked back at different windows. When I look at the summer when we were sending no emails, it was like an eleven percent repeat rate.
Dean: Right.
Jonathan: The past sixty days it shot up, but it's because people haven't heard from us in a while.
Dean: Right.
Jonathan: And they just remembered us again, so.
Dean: Right.
Jonathan: Yeah. I love that' something that I've been really thinking about, maybe not executing on, but really pondering is how do I nurture that second stage after they've purchased without just coupons. Not that I am opposed to it, what are those other ways, you know?
Dean: Yeah, there's a more elegant way to do that, you know? And there's somethings where that's certainly a way where you can do not only the winning them back, but also then helping them spread the joy.
Because if it's really good, if it really sings on their tongues with their palate that this is like, "Oh my god, this is a dream come true! I've been waiting for this. Finally, something I can have!" Right?
If that's true, they're going to be never more excited about it than the first time they discover it. Then they're meeting with their friends. They're talking to their friends saying, "Oh my god, I just tried this chocolate that's so good, you've got to try it! It's sugar free, it's raw, it's all blah, blah, blah, all of it."
They're telling about it, and pretty soon everybody's trying it, and then it's gone.
Jonathan: Right.
Dean: And that's a problem, right? We need to make it easy to share, to tap into that. It's already happening, you know?
So if you really make it easy, what if they got a gift card and three other gift cards to give to their friends?
Jonathan: Yeah, that I love. That I love.
Dean: Right, right.
Jonathan: And I like that you mentioned direct mail, because that's something else I've been thinking about. I feel like in the world where everybody is emailing, I feel like that would be probably pretty special to get some sort of card or something like that.
Dean: Absolutely. Yes, of course it is. Yeah.
Jonathan: Yeah.
Dean: So if that's the thing, if you're giving people a golden ticket that they can give to their friends, that's a really cool thing.
Let's talk about your before unit, because I wanted to lay that foundation just to show you where we're going with this, that if we looked at it that you had a business, you get a new client, and you have a fifty percent graduation rate into your after unit, and then your return on relationship in your after unit was twenty percent, you got a twenty percent return on relationship, that lifetime value just went up exponentially, right?
If you've got those two things in place. If we can turn first time orders into a second order at fifty percent and we can get twenty percent of everybody to reorder again, and that's not even counting the referral opportunities.
The lifetime value goes way up there. And I wanted to set that stage before we talk about the before unit, because I want to suggest some things in the before unit that might seem scary.
So what do you do right now to predictably get new people?
Jonathan: So it's basically just Facebook and Instagram advertising. I think that's about it right now.
Dean: Okay. And how much do you spend, what does it yield, what's the state of the union here with your Facebook and Instagram?
Jonathan: Yeah. The prices jump around like Florida, for example, we don't get a lot of orders during the summer, obviously at melting.
Dean: Right.
Jonathan: So we hone in on certain states during certain times. But on average, we would spend maybe fifteen dollars, that's actually the higher end, sometimes it will be half of that. But I would say fifteen dollars and then get an average order value of about fifty.
Dean: Okay. And that's great! So you can do that at scale? You can do that predictably? Or what scope are we talking about, like how much would you spend in a month on doing that?
Jonathan: So right now, we're spending let's see, I want to say last month was ten thousand, this month we're going to spend about fourteen thousand, I think is what we're on target to spend, so.
Dean: Okay, so you're spending ten to fourteen thousand, what does that bring in then on sales there? If you're spending fifteen.
Jonathan: Three.
Dean: Thirty to forty five kind of thing?
Jonathan: Yeah, thirty to forty, yeah, exactly. Exactly.
Dean: Okay.
Jonathan: Yeah, last month with email included, everything in there, we hit I think fifty-five thousand and about ten thousand.
Dean: I just want to isolate the before unit. So for that you're talking you spent ten thousand, and how much did it bring in let's say?
Jonathan: Probably about forty-five thousand back.
Dean: Okay, alright.
Jonathan: And right now is very good. So during the summer we would spend ten thousand and get thirty thousand back. So it varies during different times of the year.
Dean: Have you ever tried spending twenty thousand?
Jonathan: No, no not yet. No.
Dean: Okay. I wonder, who are you targeting? Who's the audience?
Jonathan: Yeah, it's very interesting what we've been doing lately, especially. We are ramping it up to shoot for twenty thousand maybe next month or the month after because we've been branching out, we've been using lookalikes for a year.
Dean: Yeah.
Jonathan: And we've been branching into seven percent lookalikes. Which I was scared of using, never thought that they would be something that would work. And we're doing these seven percent lookalikes and they're getting us better results than one percent lookalikes.
So we're getting into pretty large I forget what, it's seven thousand, and I think it's around twenty thousand, or twenty million people.
Dean: Right.
Jonathan: So it's pretty cool.
Dean: So you could spend twenty thousand, that's interesting. You've got something. How many months have you been able to do that? Was that a fluke, or is that a pretty standard thing that you spend that much.
Jonathan: It's been stable since October of last year, which is an interesting part of-
Dean: Okay. So for a year?
Jonathan: Yeah, yeah.
Dean: Yeah. So I think that would be what I would call a green light situation. That there'd be no need, no reason not to do double that.
What would stop you from doubling that?
Jonathan: Basically making sure that our production is up to speed.
Dean: Okay.
Jonathan: And our delivery is still good.
Dean: Yeah.
Jonathan: Which we're working on right now, and with incredible results. That's just it.
Dean: Yeah.
Jonathan: Right now, nothing that's made sits around for more than a week.
Dean: Perfect.
Jonathan: That's how it's been lately.
Dean: Yeah.
Jonathan: Anyone that gets their chocolate gets it very fresh.
Dean: Okay.
Jonathan: But it's also, as far as inventory management, we like to be fast with shipping.
Dean: Yeah. This is great! I want to see how high is high with this. How much can you spend?
What kind of merchants do you have? Is that profitable for you to do it that way?
Jonathan: Yeah. Yeah, it is. It is.
Dean: Yeah.
Jonathan: It's yes, yes.
Dean: Okay, so I think that part of the great thing that you have then, is you've got what is like a Goldie Locks situation here in that you can acquire new clients, new customers, at scale, at a profit.
Jonathan: Yeah, it's a-
Dean: And, yeah.
Jonathan: It's a cool thing. And I think that it's rare for our industry, really.
Dean: Right. What do you attribute that to?
Jonathan: I think it's because no one is doing it like we are. Everything is very much handmade, hand decorated. Maybe, maybe, and I guess our niche of the industry, but I guess we're essentially making a high end European truffle, but without sugar, and we're grinding our own chocolate.
So there's no one that's done anything like that. And I'm very surprised that nobody's come along doing something similar to us. But it will happen. But it hasn't happened yet. So I think that's part of it.
Dean: Yeah.
Jonathan: It's something that you can't get anywhere else. It's truly special; it's truly handmade.
Dean: Yeah.
Jonathan: Our scanners with ingredients are honestly better. I'm eating this stuff myself, and I really care about what I put in my body. And that's part of my message on social media and stuff.
Dean: Sure. Yeah.
Jonathan: So people really feel that from the messaging, I think.
Dean: Have you done any influencer relationships like that, too?
Jonathan: I haven't yet.
Dean: From social media?
Jonathan: I haven't done that yet.
Dean: Okay. Well you've got this is all green lights here for you! So much potential.
Jonathan: Yeah.
Dean: I love it! You got here just in time!
Jonathan: Yeah, yeah. I know, it really is a good thing! It's really incredible. To tell you a quick little story, one year ago, like I said, things had been working well for a year, ties into when we opened up, we were talking about the fires.
I had less than five hundred bucks to my name; we were struggling.
Dean: Oh no, don't go away on me.
Jonathan: What's that? October last year. And can you hear me? Hello?
Dean: There we go, okay, we got you. The quick little story.
Jonathan: Okay, alright. Yeah, yeah. So anyways, we had more bills than we had money. We were in trouble in October, just big trouble. We were spending, I think thirty dollars a day on Facebook ads, and that was scary.
And I was like, "Well, we're getting a hundred dollars back." I was asking friends and family for help and loans and all, whatever I could do to piece things together. And it wasn't working.
I was like, "You know what? I'm going to take this last bit of money I have, and I'm going to start spending three hundred bucks a day on ads and just see what happens."
Dean: Yeah.
Jonathan: Before I even had time to look at the results, that fire happened, lost everything else, and all of a sudden my business was taking off. It was the most interesting talk about burning the boats, right?
Dean: Right. Right, right.
Jonathan: It was from that point on, that's when things really started taking off.
Dean: That's awesome! Well I just see, I think you've got the potential to do that again.
Jonathan: Right.
Dean: Instead of spending three hundred dollars a day, to see if you could spend three thousand dollars a day. If it's that big of an audience, you maybe have that opportunity.
Jonathan: Right, right, I totally agree with you, yeah, but.
Dean: And you've already it happen once. And I think that's an amazing thing. That would be the fastest thing.
Now because literally you've got a proven whatever you're doing is a proven conversion process.
Normally when I'm going through these things, I'm looking for where's the opportunity, right? Where's the break down or where's the thing that we could do. And I was thinking that we might have to come up with something to get more people.
But you're already doing it at a profit, which makes me feel great, that let's turn that up and see how high is high here, you know?
Because at the same time, concurrently to that, if you focused on the experience, right? Not just the order, but we focused on the experience from the moment they push the order button, that there's a big opportunity to focus on getting fifty percent of the people starting, looking at our what I would call client multipliers, you know? That when you get a new client, that if the experience right now is, "Here's your receipt and your tracking number and your thank you, and your order will be there shortly," and then what happens from there?
What's my experience as a client here?
Jonathan: Yeah. Honestly, right now you get to do that, and we try to get the order in a timely manner.
Dean: And then that's it.
Jonathan: That's it, yeah.
Dean: Okay. So imagine if just with email, just if we set up some simple email and one direct mail piece that went out to everybody. That over the next thirty, sixty days, that we just made a concerted effort to get people to either buy more, again, and/or refer a friend or friends to do the same thing?
But if our goal in that first sixty days was to turn this one client, this new customer, into multiple customers, a repeat customer who also bought friends.
Jonathan: Definitely. And I love that-
Dean: And that's what, yeah.
Jonathan: Because I know that.
Dean: That's virgin smell, and you've also already acquired them, right? You spent the cost. The cost to get that reorder is going to be much less than on the front end, right?
And I would even say that if it's limited capitol, to deploy the capitol out this process to get that to how high is high? What could we establish?
If you look right now over the last sixty days, if you took the last of August, say, because they went all the way through August, September, and now November here. That if you take the last sixty days and you look at that number, and we establish a target by seeing what reality is, how many of the people who bought in the last sixty days have reordered?
That would establish a great baseline metric. And then look at what can we do to improve that number, you know?
Jonathan: Totally. Totally. Yeah, I was looking at those numbers recently. I don't know if it was the last sixty days, but I was thinking around I want to say sixteen percent, something like that.
Dean: Yep. Okay. And that's organic, right? So that's happening without you really focusing on it.
Jonathan: Right, it's not a whole lot of... exactly, right.
Dean: Yeah. So you start to think about that now, is what would it be if you took the approach of we're going to measure this granular experience from the moment somebody pressed order to the sixtieth day, and let's map out that client's experience timeline, is what would be a dream come true?
What would be the best possible outcome with that.
Jonathan: Yeah, the best possible outcome is they would come back maybe twice.
Dean: Yeah.
Jonathan: And we get them back at least twice, yeah.
Dean: Yeah. But there's the thing, is that maybe that's part of the real fun of growing like this is that you start to establish what are you proprietary metrics, right? Your metrics specifically for your business to guide and to look at what's going on.
Jonathan: Right, right.
Dean: And to guide your efforts. Because if it costs you ten to fifteen dollars right now to get a new client, what would it cost to get them to buy again?
Yeah.
Jonathan: Yeah.
Dean: And if you look at that, when you look at if they have a fifty dollar order value, if we were to make up a pie chart of that, you've spent fifteen dollars or ten dollars, or whatever it is, ten dollars to acquire them. You've spent whatever the costs of goods are plus shipping to get it to them.
You've spent that on that, so you have a gross margin on that, right? Some amount of that fifty dollars is your gross profit margin.
So that, even if you were to take a piece of that and deploy it into getting them to buy again or refer a friend, that the ROI on those dollars is going to be big.
Jonathan: Right, right.
Dean: Yeah.
Jonathan: I think that's where everything should go. I think every last speck of resource we have, that's where it should go, is really what I feel.
Dean: Yeah. Because then that with that, then that allows you to spend even more on the front end, because you know that you've not got the fifty dollars, but that you've got some number greater than fifty. The sixty day value is maybe a hundred dollars, or maybe it's a hundred and fifty dollars if they buy again and refer a friend, right?
We want to see how high is high here.
Jonathan: Totally, totally. Yeah, I love the idea of the sixty day value in creating a goal for that.
Dean: Yeah, yeah.
Jonathan: That's really valuable.
Dean: Yeah. I think that can make a really big difference here overall for you.
Jonathan: Yeah, I agree. Yeah, and I love that idea of, I'm repeating myself here, but the idea of doing something direct where we get something else from it that builds a gift rather than just, "Come back, here's a coupon. See you soon," kind of thing, you know?
Dean: Yeah, yeah. Right. Along with it, when you think about what they did order, that maybe you send them along with it or in addition afterwards a sample of something else that maybe they might like to try, you know?
Even showing that personal attention, right? "I know you tried the, whatever flavor, if you like that then this is the one that you might want to try next."
Jonathan: Totally.
Dean: You know what I mean? Yeah.
Jonathan: Yeah, I love the idea. In the beginning we did something like that, and I'm not sure why we stopped. But it's something we can definitely revitalize in some way.
We used to put a little bag of our chips that we make, we make chocolate little discs.
Dean: Oh yeah.
Jonathan: We put a little bag of those into the orders that didn't have our seventy percent chocolate bar, and say, "Here's a sample of our seventy percent," just to give them something else to enjoy besides just what they were expecting.
Dean: Yeah. Right.
Jonathan: But delivering that separately probably has an additional value to it, wouldn't you think?
Dean: I do, a hundred percent I think so. Because you want to surprise and delight and value people. So they feel like, "Wow, this is really special here!"
Jonathan: That's awesome.
Dean: That it doesn't feel like I ordered some chocolate from Amazon.
Jonathan: Right, right.
Dean: Right.
Jonathan: That's awesome.
Dean: I've gotten into a really artisanal company with an owner and a mission, and you know, a story, and all of that. A family, a community.
Jonathan: Right, that's so important! Because we can have a story on our website about what we are, but we want people to feel what we are all the way through.
Dean: Yeah, yeah. And the only way they're going to feel it is yeah, is if you really focus on it.
And that's really the thing. I think that whole going through and really mapping out that client experience timeline over those sixty day. Because if you look at it right now, there's nothing, right?
So you see doing anything is going to have an impact. And I think you have certainly email, certainly there's things that you can get people to do that would be a whim. Even if it's getting them to come to your Facebook page, if you have a Facebook, excuse me, a Facebook group or whatever you want them to do. Follow your Instagram feed, or to connect with you, stay connected on multiple channels.
Jonathan: Yeah, that's the primary thing we're doing. Instagram is probably our most active. But yeah, we have all of those different way we're already reaching people.
Dean: What are you doing right now for a Christmas offer or Christmas promotion or campaign?
Jonathan: So for Christmas, we're going to have the Christmas boxes, exclusive stuff that you can only get, it's all holiday themed rather than our core flavors.
Dean: Okay.
Jonathan: And then we're still on the fence in this, is we're wanting to do some sort of subscription box is also going to be holiday themed.
But we are also want to offer, especially to our repeat customers, some incentive or something, discount, something, to get them on board for our December box. Because that's where it's going to be. it's probably going to be our most special and more curated box of the year.
So something for people that don't want a commitment that's unique. Then something for people that would like to join us on a monthly adventure, because these next couple months are going to be pretty much October through April are all opportunities for us to create something very special.
Dean: Yeah, you look at it, right? So Valentine's Day, Easter, and yeah, all of it.
Jonathan: Yeah. Which is really cool. It's been cool for my team, and for everyone, for all of us. Because when we were just doing the same core flavors, it's the same stuff for us, and there's no excitement, and that lack of innovation and excitement. Maybe it doesn't translate to the product directly, but maybe to our brand it does.
So that's where it's been really profound to be addition the subscription box where it's something special. It's not just buy one and have it shipped every week and save five percent or whatever.
Dean: Yeah.
Jonathan: I didn't want to do it like that.
Dean: Right. Yeah, I think this is great. I think you've got so much opportunity there.
Jonathan: I appreciate that. I appreciate that. And that's a really, really valuable way to look at things, which I'm really grateful to have your input on. Because that is everything for me and for my team is like, "What are we doing for people?"
When we first started, that was what it was all about, "How can we do more for people than any other chocolate company?" And now we got a little busy, and now it's like we're revitalizing that idea and that part of our mission.
Dean: Yeah.
Jonathan: Because doing it at scale is different. But we can still deliver something that other people don't, and in a more special way, in a more personal way. So that's our desire; that's our focus.
Dean: I love it. I really enjoyed our conversations about it, because you've got a nice, mature business. You're beyond that startup phase, you're scale ready now.
This is really, I think, just establishing, what's going to be the rocket fuel of it.
Jonathan: Absolutely.
Dean: And I think it's establishing this little middle portion of here, that first sixty days, can set the tone for everything.
But the real thing to think about here is to really think of these as three separate units of your business. That's the way I always look at it, is that I would look at this sixty days, this sixty day window here, as one very specific unit of your business that the sole purpose is to establish that relationship, get them so that they've tried or know about all of the different things that you have.
Do you have a catalog or a owner's manual? That's another great thing, too, is thinking outside of the box. And instead of a catalog, I think a owner's manual or something that elevates it from that.
Jonathan: We don't.
Dean: Yeah. Okay.
Jonathan: That's awesome. I love that idea, because anything like that, I really agree, anything like that that's tangible.
Dean: Yes.
Jonathan: Because everything's so digital that having something that you can hold in your hands, probably why the free plus shipping offer works so well for many people.
Dean: Sure. Yeah.
Jonathan: To get something in your hand is... I have a collection of free books from different marketers and whatever.
Dean: Yeah.
Jonathan: And I loved it. There is something to getting that book, and the excitement about whatever that is.
Dean: Yeah. Even if, I don't know how your product ships, how it arrives. Does it come in a nice package?
Jonathan: Yeah, so what?
Dean: Like from Amazon?
Jonathan: Yeah, no, no. It's definitely not like Amazon. So we actually, because chocolate needs to be, especially our truffles need to be protected from the heat, this time of the year is changing where we're about to be able to go into cold weather mode.
But our chocolate, we put it in an ecofriendly, totally recyclable insulation. I don't know how to describe it. It's a little flap that you open up. And it's very clearly printed that it's recyclable, which is important for a lot of our customers.
Dean: Sure.
Jonathan: Then everything there's cold packs in there, and then there's the chocolate. Everything's neatly stacked and wrapped up in there.
But as far as information besides the packing slip, it's not there.
Dean: Right.
Jonathan: So that's something that I think we can expand on.
Dean: Yeah. Imagine that there's just a nice envelope that goes in with it, that's half of an eight and a half by eleven sized envelope, that inside has a little booklet and a little letter, and you're next incentive for their next order. I think that could be a big thing.
Jonathan: Totally, totally. Yeah, that sounds good. That makes me feel warm and fuzzy.
Dean: Right.
Jonathan: Because I think that doing what we do, we love what we're doing, we love the impact we're making. But if everyone could at least have that level of, even as you said earlier, some people, they are expecting a Twix bar, and that's okay. That might not be for them. But we've had the people that the flavor wasn't for them, but we took such great care of them that they referred then.
This is actually an interesting thing to bring up, we took such great care of them they actually referred us to two of their friends who have become long term customers.
Dean: Right.
Jonathan: I tracked it because I remember the experience so clearly.
Dean: Yeah.
Jonathan: And it's like knowing that that's possible, even if they didn't like it but they were like, "Man, my friend might like it because they were a great company."
Dean: Yeah.
Jonathan: That's everything.
Dean: Yep.
Jonathan: So giving more of that and translating more of that I guess, obviously, talking to the customer is great. But it's putting that in our materials, putting that in our delivery, not only in our correspondence with a customer if it's for a customer service thing, I think that's really where it's at.
You give me a ton really great ideas for that.
Dean: That's awesome. Well Jonathan, we've said it all, and we've only scratched the surface.
Jonathan: I love it; I love it.
Dean: There's so much more. That's great. But I think this is going to have a big impact.
I enjoyed it, I really did. I think you've got a great opportunity.
Jonathan: Yeah, it's been a good talk and really, really love what you're doing.
Dean: Yeah, me too. This was great. This is fun, right? This is my day, I get to sit here, and I've had a couple already of really great conversations today.
So it's awesome. Let's stay in touch, because I want to see the follow up here. I think we're going to have a really great success story here.
Jonathan: Definitely. Let's do it! And how do I get you some chocolate? If you like chocolate, that is.
Dean: Well, I have your email address here, so when we get off I will send you my address. And I would be delighted to receive some chocolate.
Jonathan: Awesome. Alrighty, well really, really good talking to you!
Dean: Appreciate it. And well we're just, just so people can follow up, where can anybody listening go to get some chocolate?
Jonathan: They can go to phikind.com. It's P-H-I-K-I-N-D dot come.
Dean: Okay.
Jonathan: And we're on Instagram also. So it's just phikind. And that's where I usually am on Instagram. So you can probably find the most of us on Instagram or through our email list.
Dean: Okay, perfect. Well there we go! Awesome. Thanks so much!
Jonathan: Alright, have a good rest of your day. Really great talking to you!
Dean: Thank, Jonathan. I'll talk to you soon. Bye.
Jonathan: Same here, bye.
Dean: And there we have it, another great episode. Thanks for listening in.
If you want to continue the conversation, you want to go deeper in how the eight profit activators can apply to your business, two things you can do right now. You can go to MoreCheeseLessWhiskers.com, and you can download a copy of the More Cheese Less Whiskers book, and you can listen to the back episodes, of course, if you're just listening here on iTunes.
Secondly, the thing that we talk about in applying all of the eight profit activators are part of the Break Through DNA Process. And you can download a book and a score card and watch a video all about the eight profit activators at BreakThroughDNA.com, and that's a great place to start the journey in applying this scientific approach to growing your business. That's really the way we think about Break Through DNA: as an operating system that you can overlay on your existing business and immediately look for insights there.
So that's if for this week. Have a great week! And we will be back next time with another episode of More Cheese Less Whiskers.