From Idea to Prototype to Production

Every entrepreneur starts somewhere. On occasion, it begins with going from idea to prototype to production. Some start with selling what there is already a demand for. Others are inventors, innovators, and dreamers. Along the way, we all need help building our businesses. A coach a mentor, or a specialist to go from an idea to a thriving enterprise. Andrew Lees help people take their ideas from the first spark of inspiration to design, production, and ultimately to the market. He shares what he has learned from helping founders create the products, and packaging the want.

Learn more about Andrew and Stoke Venture

Andrew Lees

Andrew has a background in mechanical and aerospace engineering and now runs a consulting business focused on helping entrepreneurs develop their products, and just as importantly he helps them with a launch strategy.
Without a good plan, a business will likely fail or spin its wheels for a very long time. Andrew uses his experience with launching his own products to guide people around the pitfalls of starting a new business, and lays out a clear plan to success.

When he’s not helping people develop and launch their products, Andrew loves to be outside playing basketball, surfing or traveling with his wife.

Transcript from Creating a Product from Idea to Prototype to Production

Tim Kubiak 0:04
Hi, thanks for listen to bow ties and business. I’m your host Tim Kubiak. And as always, you can find us on our socials at bow ties and business on Facebook and Instagram and bow ties and bi z. On Twitter. You can find me at Tim Kubiak just about everywhere including LinkedIn, Twitter and Tim Kubiak calm. Today we’re talking to Andrew Lee’s. He’s a background in Mechanical and Aerospace Engineering, and runs a consulting business focused on entrepreneur helping entrepreneurs develop the products. And just as importantly, launch them with a strategy. So we’ve talked to a lot of people that are in the startup business space. But we’ve not talked to anybody who works with people who are developing products. So it’s going to be an interesting conversation in that way. So when he’s not helping people develop and launch their products. Andrew, Andrew loves to be outside playing basketball, surfing, or traveling with his wife. You can learn more about what he does at Stokes And welcome to the show.

Andrew Lees 1:02
Thanks, Tim, for having me. This is this is great. Yeah. nailed the intro. I love it.

Tim Kubiak 1:07
Yeah. You know, every so often, I’ve got to learn to print things in bigger type, to be honest. So if you don’t mind, tell us a little more about yourself things that I maybe didn’t cover there, how you got into the business, that sort of thing?

Andrew Lees 1:19
Yeah, definitely. So I have a background in mechanical engineering. I went to Lehigh University. And when I graduated, I knew I kind of always knew I wanted to be an entrepreneur of some kind, I just didn’t know I just didn’t know what I wanted to do. I kind of thought I wanted to be an inventor, I wanted to develop products, even when I was a little kid. So I thought, alright, and that’s actually one of the things that led me to engineering that and my grandfather was a mechanical engineer. And we were always working on projects together. So that that was a he was a big influence to get an engineering degree. And then the other thing was just that I thought, all right, well, I want to be an inventor, but you can’t get a degree in that. So what’s the next best thing, and that’s, that’s where, you know, I decided to get a mechanical engineering degree. But I kind of lost track through college, I kind of lost track of why I was going into engineering in the first place. And so, I mean, I really, I love space, I love the idea of, you know, spacecraft and aircraft, I still do. And so I thought I kind of took a detour and thought maybe that’s what I wanted to do. But after graduating from college, I realized that any really any aerospace company I’d be working with, just like any large company, I just be, probably be another cog in the wheel. You know, no matter how smart I was, how good I was, didn’t didn’t really matter. You’re just working on one specific thing of, you know, the big of a big project. And that just wasn’t for me. So I really got back to why I got into engineering in the first place. And I started to, to develop products, and I started to kind of get more get back into inventing. And I really wanted to launch a product. Before I did, I started working for a product development firm in Philadelphia, and I was helping other people, you know, design and develop their their inventions and bring them to market. So I really wanted to do that for myself. And so that’s when I started grass racks, which is a we’re talking about a little bit offline, but it’s a we make board bike and ski display racks for your wall and we’ve also got some free standing versions. And so that’s something that I still operate today. I started years ago and really from absolutely nothing I got a piece of wood and a jigsaw and I made the first prototype and and so that’s that’s where it started. And then from there a couple years later, I started I branched out and started my own consulting firm Stoke ventures to help develop products for people you know myself so is my own company focused on helping inventors get their products to market and from there I’ve I’ve launched Stoke strategies which is all under the Stoke ventures umbrella, but it’s just after or, you know, during or before what while, you know, some some clients just want to develop their products, but a lot really need help with getting their product to market understanding the whole process and that’s where we come in helping people understand how to get from zero to one is where we really focus on

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Tim Kubiak 4:51
and do you have a particular area or industry that you help people develop products in?

Andrew Lees 4:56
Mostly consumer.

Tim Kubiak 4:58
Okay hmm So, so business to consumer is a lot of E tailing is a lot of distribution is the goal to get into traditional retail? What do you see? I’m just curious.

Andrew Lees 5:08
Yeah, sure. The Well, right now I’d say the goal, the primary goal, just, you know, for getting started, I always recommend that my clients just start selling their product online, for most products, you’re gonna, you know, especially now, where online sales, e commerce is just exploding, and we’re only scratching the surface, I think I think it’s gonna grow in a massive weigh. In the next few years, the pandemic, we’ve heard that the pandemic has basically brought three years of growth and e commerce forward accelerated it to this point, you know, and it’s, it’s only going to grow even more. So I always, I always recommend for, you know, to my clients that they sell online, and for a couple different reasons that they focus on that in the beginning. And the first is because of the, you know, the growth potential. Because of margins, too. And then it’s also, it’s a lot less risky than trying to get into retail, right off the bat. And honestly, most retailers won’t give you the time of day until you have some traction, some sales history at all. And the best way to do that, I think, is to start online.

Tim Kubiak 6:29
So when people come, do they come with a fully baked idea, they come with a concept, how early stage, do you pick up somebody’s idea for a product and really help them evolve it?

Andrew Lees 6:41
Yeah, I mean, usually, very early, you know, most people just have an idea that’s very half baked. at best. They, you know, they’ve, they know, kind of what they want, you know, they usually have a good idea of what they want the product to do. And, but, but that’s usually it. And that’s really enough. I’ve worked on everything from a napkin sketch to not having any visual at all just having a few bullet points of like, hey, these are the is the features I want and and just go for it. So yeah, usually, especially when you’re dealing with inventors, they’re, they’re really coming with an idea and maybe a sketch at best and, and I actually like that, because I’ve worked with I worked with companies that you know, really give you a more fleshed out design or write, you know, concept that they want you to develop. And while that gives you more firm boundaries, it also kind of can box you in you know, so so you’re not they have this idea that they’re very set in stone with it, they don’t want to you know, they don’t want any there to be too much artistic liberty or they don’t necessarily want you to think to to creatively and outside the box with it, but I like to get a product and or an idea and think about hey, you know, you this is a great idea, how can we make it even better? How can we make it cheaper to produce while still maintaining a quality product? You know, how can we balance everything here so you get the best product possible?

Tim Kubiak 8:28
So if we go back to for a second, grass racks, right? You have a really beautiful sustainability story there. Do you mind telling it?

Andrew Lees 8:38
Sure. So we started started with making the products out of just wood. I just I really did just take a jigsaw grab a piece of wood from I think scrap wood that was lying around my my condo and I started cutting the first prototype but it didn’t really it felt very chunky I think it was like an inch inch and a quarter thick piece it was it was really chunky it it had the it kind of split in a couple areas in a couple areas because it wasn’t an apply wood so it didn’t have it was strong but it had the the you know it was had the ability to split easier than than other woods or plywood so I thought I really wanted to come up with something that was really strong wasn’t so chunky and was also just beautiful right out of the box, you know, right without having to apply too much finish or that having to do too much sanding or post processing and came up with bamboo. So it’s it’s really strong, it’s really beautiful. And and then once I figured out once I kind of started learning more about bamboo and all its properties. I mean, I realized pretty quickly that it’s it’s not just strong and beautiful but it’s also really great for the planet because grows it’s it’s grass or the name of our business is grass racks because bamboo is technically in the grass family. So it grows incredibly quickly. And, and it sequester is a ton of carbon dioxide. So, so those two things and you can chop it down without any it’s not like chopping down a tree where it takes, you know, decades to grow back, it grows back in weeks, months, you know. So, so it’s you know, I really realized that, hey, this is a this is an awesome material to work with. For you know, it’s super eco friendly and it’s it’s something that I wanted to realize that that eco friendliness and you know, not just making a great product, but also making a great product for the planet was also super important for the business.

Tim Kubiak 11:05
So how did you get into it? How does it guy from Eastern pa and that making racks for skateboards I can get but surfboards and, and other things?

Andrew Lees 11:14
Yeah. Well, I mean, I, I always got that question. Even before I started grass racks, I’d say I tell somebody that I serve, they asked me where I’m from, especially in college. A lot of people thought I was from California. Before I told him I was from pa and and when they you know, so they thought I’d say I surf and they just assumed I was from California anyway. So like, Oh, that makes sense. And they find out I’m from from Pennsylvania and they’re like, where do you surf him? In Pennsylvania, you know, I’d always get that. I’m like, hey, it’s not that far from the beach or an hour and a half from from Atlantic City. And she just drive straight east. So it’s not that far. And but it is kind of it is kind of a leap. Like we went to my business partner Evan and I, we went to a couple of trade shows in Florida. One it’s called surf Expo, it’s like the largest watersport Expo in I think the world maybe the country used to be in California, but now they well before the pandemic they had it in, in Orange County, California, or Florida. And when we got down there, you know, people were asking us our origin story where we’re from, we’d say Pennsylvania, and they’re just like, what, what, how are you here? You know, what is that doesn’t it doesn’t add up. So we just sort of started having fun with it. And we’d say, yeah, we’re from Philadelphia, you know, the surfing capital of the world. And it’s, you know, plenty of surf around here. So. So it was, it was natural and unnatural all at the same time. how it got started.

Tim Kubiak 12:55
So have you served California at all?

Andrew Lees 12:59
I have. Yeah. Yeah. A lot. It’s a lot different than than east coast. East Coast is much friendlier. In terms of the waves. You know, it’s just much more mellow, much more relaxed. The best day of surfing I’ve served in on the east coast and, you know, New Jersey, North Carolina, North and South Carolina, California and Hawaii, the best surfing the best day of surfing I ever had was actually in New Jersey though. Just getting Perfect, perfect waves one day. The weather was insane. It was amazing. The water was really glassy and smooth. You know, these barreling waves are actually somewhat local professional surfers who were out there people were filming with telephoto lenses. I’ve never seen it anywhere else the next day. And this is what happens on the east coast. And this is why it’s just California. Other places just are better. Because the consistency just isn’t there. The next day, it was the worst conditions possible. It was like a storm. There was a storm. It was choppy. The waves were off. It was just it was like night and day from literally within a few hours. So But anyway, yeah, East Coast is still the best place I’ve ever served. I mean, the best waves I should say Hawaii is why is the best place for sure. Hawaii is the best place. Yeah, no comparison there.

Tim Kubiak 14:25
So I I’ve got a buddy from San Diego and he grew up surfing right. And literally I go out one day and he’s got his own company so I can kind of do his own thing. He’s pretty successful. He’s got a brand new Mercedes S Class. He’s gotten seats down. He lives for four so blocks from the beach so he’s close, but he still drives up because he’s not carrying the board that form. Brand new car throws the board in the wetsuit and St. Bernard and the brand new car goes circus comes back. His wife was ready to kill it.

Andrew Lees 14:55
Oh, yeah.

Tim Kubiak 14:56
He trashed the interior in under a day. Oh, sure.

Andrew Lees 14:59
Yeah. That’s a good combo dog wetsuit, sand, man, I still have sand in my car from like, Halloween, we went to Charleston. And I’ve still got like a big thing of sand in my car. I don’t even want to get rid of it because it just reminds me of the beach. So I’m just gonna keep it in there for the reminder.

Tim Kubiak 15:20
You’re not terribly far now you’re not quite in Atlantic City. Close, but you’re not terribly far.

Andrew Lees 15:24
Yeah, yeah. Not too far. And Charleston’s not that far from us about four hours. So it’s not right around the corner, but it’s not too far away. Yeah, you

Tim Kubiak 15:33
can still do long weekend. Get out on Friday. Yeah, exactly. So let’s talk a little bit more about product design.

Andrew Lees 15:40
Right? Yeah.

Tim Kubiak 15:42
I deal with software design a lot with my clients that but what do you see with physical products? What are things people need to consider or think through as they start to really try and bring that napkin drawing your life?

Andrew Lees 15:57
Yeah, so with physical products, there’s, there’s a lot of things to consider, because you actually you actually have to produce it. And I think you have to physically make it. I mean, there’s, there’s pros and cons of physical versus software I like, I like I love apps, because, you know, you can iterate it as many times as you want, and you don’t there’s no, no real significant cost to, you know, to there’s no real prototyping costs, right. With, with physical products, there’s a, there’s a very, very real and significant prototyping costs. In some cases, I mean, one to two projects right now that I’m working on that are wildly different in their prototyping costs one, to really small product. And we’re going to 3d print it, it’s literally going to be a few dollars to print it. And, and to prototype it. So we could iterate the thing, you know, 1020 times, and it would cost maybe a couple 100 bucks, I’ve got another product that I’m working on that it’s it’s a larger thing, it’s about 18 inches in diameter, about 12 inches tall. And there’s there’s about there’s eight parts, and the total cost is about four or $5,000. And, and that’s just the reality with with, you know, making a physical product is you’re you’re going to spend, you’re going to spend more in development, because you’re, you know, you’ve actually got to make the product. So that’s something that that people definitely have to consider. So usually, if it’s a pretty small product around the size of your fist, it’s not going to cost a whole lot for for prototyping. But if it’s a lot larger than that, then yeah, you really have to consider that. And then you have to obviously, if you’re if you’re, you know, talking about manufacturing the product in production, you have to think about the ordering inventory, but also ordering tooling, that’s going to make the parts. And you’ve got to think then through all the way through the process of Okay, how am I going to manufacture this product? How am I going to maybe assemble it if necessary, and then put it into a box, which is called kidding? How am I going to fulfill it, who’s going to do that? You know, so that’s, that’s just things that I mean, the most important thing, I think, is for people to get started, you know, to, to at least get get working on a designing, get the project, you know, going and because, because otherwise you’re you know, you’re just stuck, and you’ll never get it off the ground at all. So I think it’s important to just kind of take things one step at a time, not bite off more than you can chew. And then and then really to cover most of my clients will self fund through development and prototyping. But when they get to manufacturing, that’s like where the real costs can add up. And so a lot of times, they’re not paying for that out of pocket, but they’re either going to they’re either going to license a product, or they’re going to crowdfund, which is definitely something I recommend. I actually work with a company that does crowdfunding management, and they do a really good job with that. And so that’s that’s just one way that you can raise capital before you have to manufacture it that can actually pay for manufacturing and get you through the the rest of the process.

Tim Kubiak 19:45
That’s a really interesting thing I’ve never considered right is using crowdfunding for bringing a product to market. I bought a couple but it never dawned on me to do that as part of the process.

Andrew Lees 19:55
Yeah, yeah.

Tim Kubiak 19:57
Is there as you work with people part of your consulting is there discussion about volumes and quantity discounts? And I hate to say offshoring, but you know, outsource manufacturing, whether it’s on short or offshored. Is are those all areas? You help guide people?

Andrew Lees 20:15
Yeah, definitely. And that’s part of it. Because I think it’s important to to not just design a product for people and say, Hey, here’s here’s this CAD design, you know, here these files, good luck have fun. Because Yeah, manufacturing itself can be kind of tricky to navigate. So, yeah, with with all my clients were talking about whether, you know, whether they want to manufacture in the US whether they want to offshore? And how they want to deal with that. I mean, it’s some people, they don’t, they definitely want to make it in the US. You know, there’s, there’s like, no question about that. They want to find a US manufacturer, they want everything made here, or at least as much as they possibly can. And that’s it, some people really don’t care, it’s kind of interesting, I’ve got mixed feelings about it. Because at the end of the day, I’d love I want our economy to do really well, you know, but sometimes part of that part of having our economy do well is utilizing and leveraging lower court costs resources. In other countries, you know, taking advantage of the lower cost of living in other places. And the bottom line is our cost of living in this country is high. So, you know, it’s it’s difficult to compete on everything. But the cool thing is that, there’s still a lot that we can be very competitive with, when it comes to manufacturing, such as prototyping, I mean, all the prototypes I make are, are made in the US, it just for the most part, at least, it makes sense. Even if I could get something cheaper overseas, usually it makes sense to make it here because of just takes doesn’t take as long, easier, a little easier to communicate, you’re not dealing with this large production run type thing where you can, you know, make some samples, make sure everything’s right, like, you’re only making one part. So you better be right. And so so a lot of times dealing with a US company, or something like that, a lot of sense. And then usually very large parts that take up a lot of space shipping, basically, kind of you call it shipping air, like your let’s say it’s say it’s a chair that doesn’t nest very well with other, you know, with other parts. So you, you know, you can’t really stack it very well. And when you put it on a pallet, it ends up being most literally mostly air, more air than your actual product. In that case, it’s usually more cost effective just to make that here because shipping can really get kind of crazy. But if you’ve got one client who makes is, it’s a fishing product. And he makes it overseas in China, and he really had to, to get the cost to where it needs to be to be able to sell it at a reasonable cost and be able to, you know, have enough enough margin because you’ve got to consider marketing costs in there. And he can, if he orders 1000 of them, they fit in a box, like, you know, like that. So it’s no big deal.

Tim Kubiak 23:43
Is that why in some things, and I’ll pick on furniture, right? is now you see build it yourself. I know the large Scandinavian come in, he started that, you know, on 13 years ago, but now you see it in all the big box retailers. It’s build your own furniture. And I know that offshored it used to come from the Carolinas, but it doesn’t anymore. The true. It’s got to be, you know, that weight per inch in the box and the packaging for putting on that container. It’s probably a huge deal.

Andrew Lees 24:13
Yeah, exactly. And I think that’s, that’s one of the things that if you go to IKEA that they’ve really figured out is you pick up a box the size of a laptop, and it weighs like 100 pounds, you know, because they’ve they’ve got they’ve maximized every single square inch in that box. And part of that, I mean, it’s really genius design because you can’t just design something to function well they’re also taking it a step further and figuring out how, how it nest together and how it all fits together and can be packaged. So yeah, that’s exactly right. If you know if you can maximize that space. You can save a ton on shipping and then it’s starts to make more sense for shipping. Like with our, With our rack products, they they’re very, very easy to assemble. But I mean, we don’t, we don’t assume we don’t ship them assembled, we let the customers do that. And most of our products hang on the wall, it’s a mounting bar, and then a cradle that just hangs on it. But we also have a couple of freestanding racks that have four parts that, that just fit together, they’ve got slots that align with each other, and you knock it together with a rubber mallet. And, and once it’s together, it’s really rock solid. But if we were to ship that assembled, it would cost a significant amount more than flat pack shipping the way that we do it.

Tim Kubiak 25:50
That’s interesting. And I’ve looked at and we’ll put them in the post on the websites and pictures of your racks and stuff because they’re beautiful. I mean, for sure. You know, so one of the things for people listening that don’t have the visual, I’ll describe it and then you can keep me honest. Okay. So when you say rack to me, I think the tubular steel, ugly looking thing that I put my two bicycles on, right? Or roof rack, or old school ski rack and stuff you hang around, yours are beautiful, woodgrain pieces there, they’re actually kind of like art is my impression. Is that fair?

Andrew Lees 26:27
I appreciate it. Well, that’s what we’re going for. So if if you got that from the website, then I guess we’re doing something right. Because that’s, that’s spot on. And I mean, I one of the reasons I did start the business, you know, I came up with the idea for the business was, because the the options, I wanted something, I wanted some kind of a display rack for my boards. And when I looked I really wasn’t thinking the first thought I had was not, hey, let me start a rack company, it was, you know, and this is how I think a lot of ideas are born is you have a problem, and you need to solve it. And so you you know, you look around and you try and find something that will solve your problem. And when I looked around it was there, there were definitely racks out there and there had been for a long time. But all I could find were, you know, PVC wrapped in, in foam. And you know, even if they were wood, they were kind of crappy wood, lots of metal things that you would, you wouldn’t even be excited to have in your garage, let alone, you definitely can’t put it a lot of that stuff in your house. And that’s what we wanted to change really is, is kind of make it like art, I mean that your board is like the artwork. And our racks are like the frame to the art. If that makes sense. It makes perfect sense. I

Tim Kubiak 27:52
totally got it just on the first set of visuals I saw when I hit the website. Oh, cool. Cool. That’s really cool. Stuff resonated. Yeah. So back back to your consulting business. Yeah, you know, you talk a lot about selling online, you’ve talked about, you know, getting it to production. How do you how do you research? Is there a demand before you go to that step?

Andrew Lees 28:19
Yeah, that’s a that’s a great question. And probably the first thing actually, that’s overlooked with, you know, when people are starting any business, I think is is doing really good market research. It’s, you know, it’s something that that needs more attention for most businesses. And, and so, you know, the way that you do that is you look for competitive products, comparative products, what are the products that are that are might compete with your product, what are the competitive you know, products that are that are similar, you know, within that that your ideal customer might purchase, you know, and and you want to figure out you want to figure out price points and distribution channels and and then you want to dig even deeper and look at look at reviews, look at things that people are looking for, that they don’t like about a certain product and, and a lot of times you can get really good information from even from from just digging around, looking at reviews online for products because people will in those reviews really tell you what they like and what they don’t like and what they need. So, and then as much as you can talk to people you know find out Hey, is this what what would you you know, what would you pay for something like this? What How would you use this as Does this make sense? Is it intuitive? And actually, there’s a whole, there’s a really more exact way to do that part of it, to do the kind of the consumer. You have to ask potential consumers how they would interact with your product. Because it’s actually, it’s actually a lot less straightforward. A lot of people are asking very leading questions when they’re, you know, doing research, like, if I’m asking you, what do you think about my rack product? And a lot of times, it’s very, very natural for me to ask a lot of very leading questions. You’re not going to want to offend me, there, but there’s ways so there’s this like, you know, natural human dynamic that gets in the way of when you’re communicating your product idea to somebody else. That we really have to work hard to get around. And there’s I can’t think of that there’s a book that that, uh, you know, really does it justice, I can’t think of the name of it. But anyway, yeah, just doing research and figuring out what else is out there. And, and really understanding Hey, is there is there a real need for this product? You know, product? Are people actually having a problem? Or am I just having a problem that’s really, at its most basic level, that’s what you’re trying to figure out.

Tim Kubiak 31:24
One of the things I noticed, you know, you talk about a lot of people coming up with ideas to sell to consumers, right. And the thing that’s amazed me, I’m an old guy. Now, the thing that amazed me, is, every 18 months, there’s some new fancy pan and knife for sell on television. Right? So there really is a market for building a better mousetrap or reinventing what’s already there. Right, or improving on what’s already there?

Andrew Lees 31:54
Yeah, I agree. Yeah, it’s to a point, I think, if you have if you have a big enough point of distinction, you know, and your value proposition is, is better than your competition, then it’s going to be easier. I mean, there is something to be said for, hey, this guy sells, you know, something, and I’m going to sell the exact same thing. And, um, yeah, I’m probably going to get some business as long as if, if I can figure out how to, you know, connect with an audience, then, then yeah, and there’s, there is a lot of that, you know, there’s a lot of people doing that, creating Shopify stores. And there’s, you know, the whole drop shipping movement, people. I don’t know if that’s sort of died down a little bit. But I know, it was a big thing, at least a couple years ago. And it still might be that, you know, people are finding products on Alibaba, or some some other way overseas. And they’re, they’re, basically they’re getting samples or, you know, taking pictures of the product there may be, they’re basically kind of sort of rebranding it, the, you know, the product, and they’re just selling, so you could have 100 different companies selling the exact same product and just a slightly different way. And that works, but it doesn’t, it’s not going to be sustainable, you know, it’s not gonna, it’s not gonna last, you might be able to make some money, but make sure that you get out before you know, you’re, you stop making that return on investment, because it’s just not going to last.

Tim Kubiak 33:33
You’re not building it in my my opinion of that is you’re not building any brand loyalty, right? you’re delivering essentially a consumable or disposable item.

Andrew Lees 33:41
Yeah, exactly. Yeah, it’s a commodity type thing, you know, you can get it from multiple sources. And so you have to convince people that you are the source and you are you, they trust you more than you know anybody else. And, and that’s, I think that’s tough to do. It’s hard to do. So once you get once you build the trust, you want to make sure you have enough, you can be in business with that product long enough that it actually makes sense, because it might take you a year to build trust. And then all of a sudden that, you know, there’s no more meat on the bone left for whatever product you were trying to sell. You know, if it’s just a commodity type thing, you’ve built this trust, but now nobody wants your product anymore. And they can go get it from 100 other places. It’s kind of like, you know, it just, yeah, it doesn’t work. And you have to be careful to this is, I think another really big trap online, is you know, there’s a lot of a lot of people say, Oh, you know, I made a million dollars last year. My business is exploding, you know, it’s doing so so well. And that might be true, but also what what might be happening is you could be spending $1.2 million to Make a million in or you could be spending like I was, I was talking to somebody who had a friend who, who said, Hey, man, I made a I literally made a million dollars last year, that was my revenue. And he said to his friend, awesome, what was your? What was your cost? You know, for all that cost of goods of the product? plus your marketing expenses? Like all in how much did it cost you to make a million dollars, and it costs him $950,000 to make a million so he profited. $50,000 that’s a hard way to make 50 grand a year. You know, there’s a lot easier ways to make $50,000 a year, you’re better off managing a pizza shop for somebody else for 50 grand. Yeah, exactly, exactly. So you got to be so careful of that, I see that and, and, you know, some companies will, they’re, they’re okay to just blow money on ads like, like crazy, and they get all excited about the sales. But then they’ve fed, they run out of runway, you know, they don’t have maybe they’re they’re blowing through some venture capital, you know, get 100 grand, or, you know, a few $100,000. And they think, Oh, we’ve made it, we’re just going to, you know, spend a ton on, on ads, and this thing is going to blow up. And if you’re not doing it properly, if you’re not building a good strong email list, if you’re not remarketing, if you don’t have a product that that is consumable, you could be in trouble. And that’s one thing that with, with the product, grass racks that we sell, that we have to be very, very careful of, because it’s not a consumable product, it’s something that honestly, most people are going to buy one or two in their lifetime. So our lifetime value is, yeah, our our products, you know, sell for a decent amount, but the lifetime value really might not be that much. And so we can’t, we can’t afford to spend a ton on on ads, because we have to get a return quickly. Whereas like if you’re selling coffee, and you could lose money on that first sale, but you’re gonna make it back on the repeat business as long as your coffee doesn’t suck. So, you know,

Tim Kubiak 37:16
there’s nothing worse than bad coffee.

Andrew Lees 37:18
Yeah, exactly. Yeah.

Tim Kubiak 37:23
So so that’s a really interesting dilemma. So your customer comes in, they buy something once or twice, how do you stay in front of them? How do you look at your own product evolution to create repeat customers? So say I have a rack and I’ve got you know, you know, I’ve got a floor rack, and I’ve got my guitars in it. And maybe I’ve got a wall rack and I’ve got surfboards in it, or snowboards in it. Right? Yeah. What’s what’s the next logical evolution to get them to buy something else.

Andrew Lees 37:51
So definitely, I think the the most important thing you can do with online sales is, is build an email list, no matter what your what you’re doing, is, you know, whether you’re selling a physical product, a digital product, an info product, whatever it is, email is, is just the most powerful tool you can use. Because it’s basically a free way to remark it to people, to your existing customers, to people who may have been interested in something, you know, you, you might put up a lead magnet, like a discount code or, or a tutorial about something that’s relevant to your audience or something that’s going to, you know, make people put their, their email address in. And so you can reach reach out to those people and stay in touch with them. And introduce your your new products, to, you know, to that email list. So that’s, that’s the best way I think you can do it. Because otherwise you’re spending more money to, you know, to advertise, you know, to the same people who you could have just captured. And it could have just been on your list the whole time. So I think that’s, you know, that’s the most powerful way really of introducing new products to your, to your audience.

Tim Kubiak 39:23
Any thoughts in that consumer space? What’s a good sized list? I know, it’s a debate in the business to business world. I’m just curious. your view? Oh, yeah, I

Andrew Lees 39:33
mean, I think the really, it doesn’t matter the size of the list doesn’t matter as much as the quality of the leads. So we’ve actually go back to grass tracks again, just because it’s a, you know, kind of a good example of, of all this stuff. We’ve run contests in like in partnership with others. brands. And we’ve gotten lists from that from those contests that were 10 or 20,000, that had 10 or 20,000. leads in it, or, you know, customers. And, and so where were for a while, I mean, it’s taken us a while to get the the customer lists that we that we already had. And we hadn’t, to that point, we hadn’t really focused as much as we should have on email acquisition, lead acquisition. And so this, we got this list 10 to 20,000 people, we’re so excited, we’re, you know, we’re like, this is gonna, we’re just, we’re gonna make so many. So we’re gonna send one email and probably make like, 10 or $20,000, you know, we’re gonna get a couple 100 customers No problem, we send an email, and absolutely got zero sales. And there, and yeah, and the reason is, and we the unsubscribe rate was higher than it should have been. And, you know, we realized that the reason was, because they, the people who signed up for that contest, they just wanted something free. And not only that, but they weren’t even necessarily interested in our product, there were like 10 other products that were, you know, that were being given away, and one of them was a vacation worth, like, $10,000. So everybody wanted the vacation. You know, they didn’t care about all the other stuff, right. And so, so it wasn’t, the list wasn’t interested enough in our product. But if we, if we run a you know, 10% discount, and we have that as our lead magnet on our website, and we get an email from that, that’s much more. That’s a much better lead. And so we don’t need nearly as many, you know, 100 100 people who sign up for a 10% discount, let’s say, half of them use it, half of them don’t. So 50 people don’t use it. We’re just going to keep remarketing to those 50 people. And we’re definitely we’re almost definitely going to get sales from just those 50 people over time, because they were interested enough in our product to put their email in for a discount code. So they’re, they’re, you know, likely to purchase something, it just may take a while.

Tim Kubiak 42:29
What what’s the value of a social media following to a new product or? Or to grass racks even?

Andrew Lees 42:35
Yeah. Oh, man. So that’s Yeah, that’s another thing to be really careful of. We, we do we have a decent following on on Instagram, you know, we’ve built that up over the years, and it’s pretty good. I think we’ve got like 13 or 14,000. So it’s not massive by any means. And we get a, you know, we need to be better with our engagement, for sure. And that comes down to consistency of posting. But where we’ve really seen the return come in is with Pinterest. So interesting. Yeah, Pinterest has has absolutely outperformed Instagram by a huge amount for us. And it’s different for you know, for a lot of things I think if you’ve you know, if you’re doing fashion, or see fashioner or, you know, like a health related product, and it gets grabs a great place to be. Either way, I would still also be on Pinterest. But yeah, Pinterest is really good. And one one reason that I love it is because it’s a search engine. So it’s it’s indexable when you post something on Pinterest, it stays on the internet forever, and it can be searched. So when you search something in Google, you know, you could end up on a Pinterest post or you know, or a board. And you can also you know, if you’re searching or you just search something in Pinterest, you know you’re gonna find your your post could come up where I don’t think people aren’t really searching as much for things on Instagram, you know, it comes up in their feed, because it’s it’s got the right hashtag, you know, it, it churns through the algorithm the right way for it to show up on somebody’s feed who hasn’t ever seen your product before, and then they follow you and now they’re part of your, you know, part of your group. But once you post something on Instagram, it’s like, you have to keep that going. Very, very consistently. And you’re only as good as your last post whereas with Pinterest I we’re getting, we’re getting traffic from posts we posted a few years ago, and that’s not at all the case on Instagram.

Tim Kubiak 44:56
It’s interesting because Pinterest, how you’ve described it My takeaway on that is, it’s more like good SEO copy, right? It’s like having a good blog post. It’s gonna continue to live until somebody Jacks with the algorithms and takes you out of it right? Because then you sell more ads. Yep. Google, by the way, right. But Facebook’s is saying so like, even for this podcast, I started to build an audience on Facebook. And what I was finding is they weren’t seeing the posts, I had to pay every week to put them out. And I’m like, Well, guys, I’m not going to do that. So I frankly, I took a different tact. And I invested in a transcription service and said, I’ll take the SEO out of all the different search engines and just let it run that way.

Andrew Lees 45:37
Yeah, yeah. And out of curiosity, is that how’s that working for the park? You know, is are you starting to get a little traction on that? Yeah, so

Tim Kubiak 45:44
it’s really interesting. So I ran it on 15 back episodes up front, right in the investment wasn’t huge. Frankly, I’m pretty open about it. I used otter AI, I had a discount code for my podcast host, I got it for like 85 bucks for the year. Right? It’s brilliant. Because what happened is, much like you described on the Pinterest posts, is once I uploaded a transcript to back episodes, episodes that weren’t getting any listens, weekly, started getting three to five lessons a day. So after they were not fresh in the queue, they just kind of had died, right. And the website was still getting a little traffic. So I actually went put it back there. And you know, it’s not huge numbers. But if you pick up 35 lessons, and you do 50 or 60 episodes a year, and you’re picking up 35 lessons, 40 lessons a day on old content. Oh, not it’s not a bad strategy. And, frankly, it’s helped the SEO on my website quite a bit, because it’s taken off the need to keep feeding the search engines because I can just put the transcripts up there weekly, and MX five or 6000 words in a transcript. And there you go, it’s less content I have to write and it’s still free content for you know, people who want it.

Andrew Lees 46:57
Exactly. Yeah. And people are people might want to read like some people want to read some people want to watch or listen, I’m a watch or listen kind of guy. But my wife likes to read. So show the same, you know, article online, she’ll read it. And I hope there’s a video because I like to watch the video, you know. But it’s but in addition to that, where your target, you know, where you’ve got written content for people who want to read it, like, just like you said, Google picks it up. And that’s really, really powerful. So I think that’s the better investment, then I think if you can invest in SEO, which at the end of the day, SEO really, because there’s it’s just like a black box. I feel like a lot of people get scared when you know, they think about SEO, and they talk about like, what is it really, at the end of the day, it comes down to just content and content that can be indexed by search engines, Instagram, and Facebook cannot so so yeah, it’s, you know, written posts or video, YouTube is I’ve heard that YouTube is the Internet of 10 years ago. So it’s while it’s still, you know, while there’s still millions and millions of videos up there, and they’re, you know, it’s seems like it maybe has reached some kind of saturation. Apparently, it’s not even close. And because Google owns YouTube, if you’re posting videos up there, they love it. So and that’s, that’s pretty much free, you know, to just to get a video up, then, you know, you don’t necessarily have to promote it or advertise it. I’ve got a buddy who started he lives in Philadelphia, and he started a website called liberty, Liberty leather works. And he started maybe 10 months ago. It was with zero traffic. And he just wrote articles consistently and relentlessly. And now he’s up to I won’t give away his exact numbers, but it’s a lot. It’s like 10s of 1000s of visitors a month and from from absolutely nothing, not that not even a year ago, you know, so. And it’s this and he just sits back and watches he doesn’t even have to post anymore. Those. Let’s say he’s got 10,000 this month, next month, they’ll have 12,000 the next month, they’ll have 20,000 the next you know, so it’s like it. It’s just as Google continues to index and find your content. It’s just gonna continue to grow.

Tim Kubiak 49:46
It is right in it’s fascinating and watching people come up with alternative search, I think is is really the disruptive thing in that space to keep an eye on Google certainly going to be a monster for a long time to come. But I think it was last week. One of the chief data scientists from, went out and funded another search engine, that’s going to be less ad driven in theory, and we’ll see how much the market, right and I’ve got a cybersecurity background. So I’ve seen people go to DuckDuckGo and other things, right. So that there are options out there. Verizon, actually, two or three years ago, launched a privacy search engine, mixed results, but right on, but part of its just usage, too. It’s not broadly adopted. And I’m old enough that I remember what it was before Google. Yeah, right. Yeah. I remember AltaVista?

Andrew Lees 50:39
Yeah, yeah, yeah. Yeah. I actually think my dad was the first one who told me about Google. I don’t know how he knew about it before I did. But in actually I was in college that definitely that dates me here. But he’s like, have you heard about that new search engine? Google? And I’m like, what’s a what’s a Google? That’s that’s sound? Okay. I don’t whatever, I don’t care. You know, I was worried about the engineering homework that I had not having any idea how, you know, how would just change the world in a massive way?

Tim Kubiak 51:10
Yeah. In the the beauty of them is that you talk about access product, right? we kind of talked beforehand, they figured out how to make their money off of everybody’s access data and metadata. It’s really not even you know, it’s not what they started. So their profit came from something they never imagined. So

yeah, yeah. That’s, that’s awesome.

So I know, we’re coming up on time here. So anything I should have asked you that I didn’t anything you want to tell us about that? I didn’t get a chance to bring up.

Andrew Lees 51:39
I can’t think of anything in particular. I mean, I think we talked we hit on a lot of a lot of good things. You know, I think it was I appreciate you know, bringing up grass racks. And I think that was a ended up being kind of a cool example, to use to talk about product development, you know, how how a product can be developed and how you think about manufacturing and prototyping and manufacturing. And then how you think about a launch strategy and how you’re actually going to get your product to market. And I think that’s it. I think it was awesome. I really enjoyed it.

Tim Kubiak 52:16
It’s been a pleasure. So for anyone who’s interested in talking more with Andrew, if you go to stoke, I think you’re offering the ability to schedule a call with you. Is that correct?

Andrew Lees 52:26
That’s correct. Yep.

Tim Kubiak 52:27
All right. Awesome.

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