Invest in valuable content. Visually appealing content and assets are a great investment for your business. Videos and images are key to telling your story. With an e-commerce business, it can be tough to sell things online without those assets. Look at all the great e-commerce sites, almost all invest heavily in beautiful eye-catching content for customers to sort through.
As part of my series about the “5 Things You Need To Know To Create A Highly Successful E-Commerce Business”, I had the pleasure of interviewing Ben Kovacs.
Ben Kovacs is the Co-Founder of the international Myster and Octave brands and newly appointed to the Next Green Wave Holdings Inc. (CSE: NGW) (OTCQX: NXGWF) Board of Directors. Mr. Kovacs is the former chief revenue officer of NorCal Cannabis, one of the largest vertically integrated indoor producers in California. Ben’s other experience includes time spent with Twitter and operating Guardian, a non-profit martial arts gym in Oakland that provides free boxing and Brazilian jiu-jitsu to kids.
Thank you so much for joining us in this interview series! Before we dive in, our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?
I worked at Twitter for a number of years before getting a calling to start a non-profit. We opened up Guardian, a non-profit martial arts gym in Oakland, CA in 2016 and it became one of the fastest-growing non-profits in the bay area. Around 2018 I wanted to get back into a more lucrative business so I began investing in cannabis which eventually led me to becoming the Chief Revenue officer at NorCal cannabis.
I learned a ton about the cannabis industry and met most of the important contacts in the California cannabis industry during that time. Throughout that entire process, I was working with my partner, Davis, to continue to develop our hardware and accessories companies, Octave & Myster, which I eventually decided to turn a large part of my attention to as that business really started hitting a tipping point of going from a hobby business to one with differentiated products and significant upside.
What was the “Aha Moment” that led to the idea for your current company? Can you share that story with us?
The real tipping point for our hardware and accessories business was when we decided to bring in our overseas partners. This significantly diluted us as founders, but it was the best decision we ever made to lock down our supply chain with the best engineers in the world to create world-class products and take the company to the next level.
Can you tell us a story about the hard times that you faced when you first started your journey? Did you ever consider giving up? Where did you get the drive to continue even though things were so hard?
So many times we almost gave up. We were always running near empty, mostly bootstrapping the company with very limited salaries and overhead. It’s a costly business to get off the ground, order inventory, and develop products while waiting for sales and customer payments to catch up. It’s why having partners is so important, it’s a lot harder to throw in the towel when your letting down your friends who you have seen sacrifice so much.
So, how are things going today? How did your grit and resilience lead to your eventual success?
Today we have really turned the corner and will launch the most robust roadmap in 2021 with the best cannabis accessories worldwide. I believe that the focus on being resilient and always fighting that uphill battle made us work harder, and not be lazy. So many companies raise money on just an idea and then squander it with bad decisions and a bloated team. Not having the luxury to do that might have been the luckiest break we got, even if we didn’t realize it at the time.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘takeaways’ you learned from that?
We made lots of mistakes. One time we wired 25,000 dollars to the wrong place in China, most likely scammed by an employee at a factory. We never saw that money again, and certainly didn’t have it to spare at the time.
What do you think makes your company stand out? Can you share a story?
Because I worked at Twitter for so long, I really learned how the best companies in the world treat their employees to retain and attract top talent. We are implementing some of these things with our Chinese partners bringing them a “Silicon Valley Experience” to their workplace in China. Free food, equity for all employees, and higher pay. We are not ashamed to say we make products overseas, rather we embrace the new global economy and recognize that our colleagues are the best in the world at what they do. Treating people with respect and dignity, even when you don’t have to, is how we want to grow our company and spread positivity in the world.
Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?
With our business, it’s easy to get distracted. You have to focus on just a few core things. The second thing is, you have to have one day away per week to turn off the phone, stop replying to slack, and not worry about your inbox.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?
Ok thank you for all that. Now let’s shift to the main focus of this interview. The Pandemic has changed many aspects of all of our lives. One of them is the fact that so many of us have gotten used to shopping almost exclusively online. Can you share a few examples of different ideas that eCommerce businesses are implementing to adapt to the new realities created by the Pandemic?
E-commerce is obviously benefitting during the pandemic while brick & mortar is struggling. For the cannabis business, there is no longer such a stigma for ordering products online and having them delivered, nor a fear of getting in trouble. For years people went into head shops to make more discreet purchases, but we think that is becoming less of a focus everyday.
Amazon, and even Walmart are going to exert pressure on all of retail for the foreseeable future. New Direct-To-Consumer companies based in China are emerging that offer prices that are much cheaper than US and European brands. What would you advise retail companies and eCommerce companies, for them to be successful in the face of such strong competition?
I think the folks who don’t create value, “the takers or the middlemen” are in trouble. You have to have a competitive advantage, because Amazon sees your margin as their opportunity. We worry less about this as the manufacturers of the products vs. just being a site online that re-sells something everyone else has.
What are the most common mistakes you have seen CEOs & founders make when they start an eCommerce business? What can be done to avoid those errors?
They think that people will just show up. Starting an Instagram account with 58 followers and launching a website isn’t going to work. It takes years to build that organic reach, or you have to spend a ton of money and have other avenues for driving traffic to make e-commerce work at scale.
In your experience, which aspect of running an eCommerce brand tends to be most underestimated? Can you explain or give an example?
I believe folks think it’s easy and that the margins are so huge. In reality, there are a ton of costs that don’t get factored in. Credit card processing, inventory warehousing, shipping, returns, customer service, etc. You really have to calculate all costs.
Can you share a few examples of tools or software that you think can dramatically empower emerging eCommerce brands to be more effective and more successful?
We use all the basics. Slack for internal communication, Hubspot for CRM, Mailchimp for email marketing. We have found actually that there is a tendency to constantly chase shiny objects with their latest and greatest software, but are almost always disappointed.
As you know, “conversion” means to convert a visit into a sale. In your experience what are the best strategies an eCommerce business should use to increase conversion rates?
Reduce the SKUs on the page, focus on mobile conversions vs. desktop, and ensure page load times are as rapid as possible.
Of course, the main way to increase conversion rates is to create a trusted and beloved brand. Can you share a few ways that an eCommerce business can earn a reputation as a trusted and beloved brand?
I think most of the trust and love is fixing mistakes. Making it easy to return products, honoring warranties, and just doing the right things quickly are extremely important to build trust and loyalty with customers. It’s way easier to keep a customer happy when there is a mistake than pay to find a new one.
One of the main benefits of shopping online is the ability to read reviews. Consumers love it! While good reviews are of course positive for a brand, poor reviews can be very damaging. In your experience what are a few things a brand should do to properly and effectively respond to poor reviews? How about other unfair things said online about a brand?
Bad reviews are just part of the game. Most people though dont’ leave scathing reviews if you return their money or swap out their defective products. Bad reviews come when you dig in your heels and refuse to make a bad situation right, even when it’s the customer that is in the wrong. Bad reviews aren’t worth the fight to save a few dollars.
Ok super. Here is the main question of our interview. Based on your experience and success, what are the five most important things one should know in order to create a very successful e-commerce business? Please share a story or an example for each.
- Familiarize yourself with the industry and how your product fits (or doesn’t) in. Too many people start E-commerce companies with businesses that are not differentiated enough. It’s hard to garner people’s attention and even harder to get them to put their credit cards down to make purchases if you don’t have something unique or special to sell.
- Attracting business. If you just put up a website without being able to drive traffic, you’re not going to sell anything. Social media is one obvious avenue but there is also email marketing, text marketing, blog posts, collaborations with other brands, and many other avenues to get your name out there and drive traffic to the site
- Invest in valuable content. Visually appealing content and assets are a great investment for your business. Videos and images are key to telling your story. With an e-commerce business, it can be tough to sell things online without those assets. Look at all the great e-commerce sites, almost all invest heavily in beautiful eye-catching content for customers to sort through.
- Focus is important. Don’t overload your new website with products, SKUs and spread yourself thin. Often the best stores focus on just one or a small group of related products that make checkout decisions easy.
- Social Media is your friend. E-commerce businesses need to start somewhere. Because you may not have “word of mouth” yet like a larger brick and mortar business, it is important to attract buying customers. Social media will become a large asset to your business. Create and maintain an Instagram, YouTube, a blog, ads, to drive traffic to your site. Showcase your products in an attractive light whenever possible. Not only did we create and maintain our social media pages, we engage with our customers. Between product giveaways and sharing user-generated posts, we keep our customers and friends engaged.
Bonus tip: Be patient! All these things take time, in some cases many many years to get going, build lists, build trust from customers, etc
You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
I have tried to make a small difference in the world with our non-profit, Guardian. I felt providing exercise and safe haven to kids for free was one of the simplest and most effective ways to make a small difference. Outside of that though, I think too many people take things for granted. That’s why I’m so focused on our initiative for paying our Chinese team better and increasing their quality of life. We should take care of the people that help us make our money and ensure we are spreading those dollars out more fairly rather than paying people less and then donating to a charity on the backend. I call it “volunteered socialism”
How can our readers further follow you online?
You can send me a friend request on LinkedIn, Ben Kovacs. I’ve made a conscious decision to not spend much time on social networks like IG & Twitter anymore.
This was very inspiring. Thank you so much for the time you spent with this!