It’s that time when people face a new year with new resolve to make all sorts of improvements in their lives, many of which fall by the wayside by February. Gyms and diet book authors thrive on this quirk of human nature.
When it comes to entrepreneurs, there is an additional level of resolve that should be done.
For a consumer retail business with all of the Christmas hoopla over and done with it is a time to reflect on what lessons were learned over the past year and what needs to be done to improve the brand going forward. As ephemeral as personal new year’s resolutions may be, when it comes to making such resolutions about business matters the stakes can be quite a bit higher. Often the continuing viability of a business can hang on the balance of how well, or even if, such resolutions are accomplished.
Of course, such critical introspection need not only be done in early January but with resolution season upon us it seems a good time to open up my thinking about what we resolve to do in 2018 at QIVIUT & CO.
Marketing, Marketing, Marketing
Like the real estate mantra about location, marketing is the key to building just about any brand. You can build the best mousetrap in the world but if no one knows about it rodents will have little to fear about its usage.
To date, we have focused our resources on bringing our physical products to market and let marketing take a back seat while we did that in terms of money and effort spent. The thinking was and is that without perfecting – a term of art because we are a long way from being perfect – our first qiviut products, all of the marketing in the world would not sustain us for very long if the hype did not live up to reality.
This is particularly true with a luxury product where the price point minimizes any degree of forgiveness by customers. And this is even more the case when selling online only. Our customers’ first tangible experience with our products, the touch, feel, look, even smell, occurs after purchase so all of the expectation created by our photos, graphics and text has to measure up upon delivery.
While there is certainly more to be done on new product development, we now have a sufficiently broad line that compels us to re-prioritise our focus to make sure that the story gets told to the widest possible audience this year. For all of the talk about how the internet and social media has leveled the playing field for small brands when it comes to marketing, it is still a time consuming and expensive proposition to execute in all channels, particularly for a luxury brand. How does one compete with legacy brands for consumer attention via paid media (including digital advertising), PR exposure, sponsorships, special events and the like with a budget 1/100th the size?
Then, too, some type of retail presence needs to be factored into the marketing mix. The most common enquiry we get from potential customers is where can they go to try on The Qiviut Jacket or see one of our head or neck warmers? At this point, the best we can offer is to bring our products to them and only in the greater London area. A broader retail presence of some kind would go a long way towards satisfying this need. But when you are talking about a company at our stage of development, this effort is more about building brand awareness than generating profit so, in reality, a marketing expense.
Finally, one of the top marketing efforts for 2018 has to be figuring out how to gain access to the China market in which we have a zero presence now. The marketing techniques that work for the rest of the world by and large do not work for China. It has its own e-commerce ecosystem with restrictions on how it can be accessed. The consumption of marketing messages and purchasing habits are also quite a bit different. And it is typically expensive and difficult to get a toe hold, particularly without a bricks and mortar presence where Chinese consumers can inspect products and satisfy their concern about counterfeit goods.
Nevertheless, with an e-commerce market worth in excess of US$672 billion annually, China cannot be ignored.
I suspect that perfecting such access could well take more than a year but we need to start sooner rather than later.
Therefore, while there are many ways to skin the marketing cat, few are inexpensive and it takes a good bit of trial and error to figure out which ones work best and which ones don’t. All the more reason to make this resolution our top priority for 2018.
Funding, Funding, Funding
While marketing may be our top priority, there is a good argument that funding should occupy that place because without the necessary funding marketing can’t happen. It is certainly a very close second.
Every entrepreneur approaches doing a start-up somewhat differently. If I were a 20- or 30-something with a tech background I might be pitching the concept of a new app that has yet to generate a pence of revenue. But as a lifetime entrepreneur, my background is in creating tangible products or services and that is what I can get my head around and feel sincere about promoting.
To date and for better or worse, QIVIUT & CO has been self-funded through the highest risk stage. But now two years on, rather than just an idea we have products, we have customers and we have revenue. The jury is still out on whether or not we will ultimately succeed but I can look anyone in the eye and say,
“This is what we have done, this is what we propose to do and this is why I think it will work.”
and feel totally comfortable doing so. I would not be so good at flogging just an idea.
At this point I think we are well positioned to find investors who will buy into our project and are beginning the fundraising process this month for a relatively modest six figure seed round of investment. However, more than money what would be ideal for QIVIUT & CO at this stage is to find one or more investors with industry expertise as much as money.
Most good entrepreneurs know what they don’t know and while we have come a long way in figuring out how to make and sell qiviut somethings from nothing, a seasoned industry investor with expertise in luxury garment manufacturing and/or marketing and/or distribution would accelerate the company’s development and make it more valuable in the end.
Therefore, in the first instance we will be pitching potential investors with some knowledge or background in the luxury sector, ideally with clothing. I think we have a very good story to tell, very good and unique products with proven market acceptance and very good financial metrics on which to build the business. That said, I don’t underestimate the challenge of finding the right investor(s) who appreciates the challenge of scaling a business that deals in limited editions mandated by the scarcity of its raw material. I think we have a good answer to that challenge but we will see what potential investors think.
Nevertheless, I resolve to raise our first round of seed funding this year. If any reader wants to know more, contact me directly.
Data, Data, Data
What has also taken a bit of a back seat while we perfected the products for the brand is a deep understanding of our customer base.
Don’t get me wrong, at this point I think I have a very clear picture of who our target customer is but largely gleaned from anecdotal evidence, often getting to know them personally. But we don’t know much about their habits: what communications channels they favour, where they hang out, what they read, etc. More importantly, we know even less about these metrics among potential customers.
As invasive (some might even say creepy) as this may sound it is the sine qua non of modern day marketing (remember my top resolution?). It is also a specialty unto itself and requires significant money and trial and error effort to do it well. But trying to market to customers, particularly online, without such data is one-hand-behind-the-back effort.
Accordingly, I resolve to improve our understanding of customers and potential customers by enhancing our analysis of customer data while always being mindful of the sensitive resource we possess. We never have and never will sell any customer data. The good news is that via the GDPR the EU will have serious enforcement authority over companies protecting consumer data as of this May. We look forward to compliance with that directive.
Marketing, Funding and Data – three key resolutions that will have a big impact on the future course of the company. Check back in December when I will have a follow-up blog to assess how we did.
As for those 5kg I want to lose, well that is another story.