Designing Something

How-To Measure Social Media (for Free)

Posted on January 18, 2015January 17, 2015 by Maria in How-To, Marketing

Yep, social media can be an awesome, inexpensive and fun way to connect with current and potential customers and their communities. It can also be an excellent way to waste a lot of time and money. Are you wondering if your social media efforts are paying off? Here’s my method for how to measure social media for free (and not just for a first 30 day trial period either).

In the old days, people were obsessed with growing their fans and followers above all else. Times have changed, as we’ve learned that those metrics are not a good indicator of how well you’re connecting with your audience. Rather than counting how many fans you have or how often you are posting, pay attention to your engagement rate. Engagement is how often people interact with your content, either by liking it or sharing it or commenting on it.

The engagement rate is a blend of likes/comments/shares, but at Po Campo we break it down to look at each action separately. This takes more effort, but it sheds light on how the different platforms behave and helps you understand what to do to up your game in each space.

The Engagement Rate can be broken down into:

Conversation Rate (Comments per post)
Amplification Rate (Shares per post)
Applause rate (Likes per post)

I used Facebook terminology, but all social media platforms have their equivalents. For example, on Twitter, Conversation = replies, Amplification = re-tweets, and Applause = favorites.

This concept was first introduced by Avinash Kaushik in his post “Best Social Media Metrics: Conversation, Amplification, Applause, Economic Value“, where he advocated measuring the outcomes and not activity. At the time, there was no easy way to get these numbers. Now, thankfully, there is. TrueSocialMetrics offer a service that measures these things automatically for you.

Screenshot from TrueSocialMetrics, courtesy of Moz

However, TrueSocialMetrics is not free; their most basic package is $30/month. While not terribly expensive, those monthly costs really add up, so I wanted to compare how much it would cost to do the same measurements internally. After devising this method on how-to measure social media, I found out that we could do it once a month for half the cost. Once a month is a frequency that works for us because, well, we’ve got other things to do besides just measuring social media.

In devising our own system, I added a few more metrics:

Click-Through Rate, since one of our social media goals is to increase web traffic
Relative Engagement Rate, to compare how active each follower is on each platform
Economic Value Rate, to see how much money each social media platform brings in

Measuring-Social-Media-Worksheet — Access this temple on Google Docs and start measuring your social media efforts today.

I created a template on Google Docs for you to use. It consists of two worksheets:

The first tab is a worksheet where you enter your data in the top portion and the rates are automatically calculated below. We do this on the first day of the month. In my example above, you can immediately see which platforms are performing better across the different metrics: Facebook is great for conversations and sharing, Pinterest users are more engaged, Instagram gives us the loudest “applause”, meaning our content there is resonating well. Our Twitter account obviously is lacking across all metrics. I’ll dig deeper into what to do with these learnings in a separate post, but I bet you already have some ideas.

The second is a worksheet that calculates your month over month improvement. I meet with my social media team member in the beginning of each month to review our numbers and to identify what is working well and what needs some help.

Your next question is probably where to find the numbers to populate the top part of the “How-To Measure Social Media” table. Well, here you go! Below is how to find your data, platform-by-platform, using completely free services. Once you do it once, it’ll become quicker, I swear.

Jump to a specific social media platform: Facebook, Twitter, Pinterest, or Instagram.

Facebook

# of Likes

Go to your Facebook page’s Insights panel and click on Likes tab.
Update dates at right side
See total likes beneath graph

# of Posts / Comments / Shares / Likes

This one unfortunately isn’t as straightforward because Facebook Insights shows you the average amount of comments/shares/likes that your posts received, not the totals, which are needed to calculate the rate. I prefer the rate over the average so you know how effective your posts are. If you can accomplish the same results with 20 posts instead of 200, that is a better use of time, and only the rate gives you that information.

Go to your Facebook page’s Insights panel and click on Reach tab and click Export.
Change dates in pop-up window and select the “Post Data” report
Open the report in Excel and try not to feel overwhelmed. Navigate to the second tab titled “Lifetime: The number of unique people who created a story about your Page post by interacting with it. (Unique Users)”.
See how many rows there are and subtract by two so as to not count the headers. This is your # of Posts value.
Add up the values in Columns I, J and K (comment, like and share, respectively) to get those values.

Measuring-Social-Media-Facebook-Export — Step 1: Exporting the data for your posts

Step 2: Open data and add up your values

# of Clicks to Website & Total Revenue

These last two values can be found in Google Analytics. You need to check both the “Social” channel and “(Other)” channel, as traffic from smartphone apps sometimes shows up in the latter.

In Analytics, go to Acquisition > All Traffic > Channels and change the date at top.
Click on Social to see traffic coming directly from the social media sites. Write down the total number of sessions (clicks to website) and total revenue.
Go back to the Channels report and click on (Other) to see more traffic from those platforms that came to your site from a different app. Again, write down the sessions and total revenue from each channel.
Add the values from #2 and #3 together and put them in the worksheet.

Twitter
You’ll need to set-up a free Twitter analytics account to access these reports.

# of Followers

In your Twitter Analytics page, go to “Followers” tab
Find your number of followers on a particular date on the bar graph.

# of Posts / Replies / Retweets / Favorites

Similar to Facebook, Twitter Analytics makes it easy to see the averages but difficult to see the totals. You have to download the data and add it up in Excel.

In Twitter Analytics, go to “Tweets” tab and click “Export Data”. This can take awhile because it exports ALL your data.
Once opened in Excel, copy the rows of tweets that were posted in your time period and paste into a new worksheet. (This is optional, just makes it easier to work with).
Count the number of rows to get your # of Posts value.
Similar to the facebook data above, add the values in column H, I, J to get your total Retweets, Replies, and Favorites, respectively.

# of Clicks to Website & Total Revenue

These last two values can be found in Google Analytics, same as above.

Pinterest
You will have to set up a free business account on Pinterest to get access to their analytics.

# of Followers and # of Pins

Your # of followers can be found on your main profile page. There is no way to find it back-in-time, so just be diligent about recording this number on the last day of the month.
There’s no way to see how many new pins you posted during the time period, but pins tend to live on longer on Pinterest anyway. Therefore, we record the total # of our pins on all of our boards for this metric.

# of Repins / Likes

Once again, you have to download the raw data to be able to count these metrics, as Pinterest analytics only gives you the averages for a certain time period. The raw data only shows you your top pins, not everything, but I’ve found this to be workable. Sadly, Pinterest Analytics does not offer a “comment” metric, so we are unable to determine the conversation rate for this platform.

In Pinterest Analytics, go to Your Pinterest Profile tab and select the Impressions option. Change the date and then click “Export”.
Similar to the facebook data above, in the”Top Pin impressions” section, add the values in column G & H to get your total number of repins and likes.

# of Clicks to Website & Total Revenue

These last two values can be found in Google Analytics, same as above.

Instagram
Instagram does not offer its own analytics yet. We use a free account on Iconosquare for these basic metrics. Most of their statistics are on a rolling monthly basis, so it’s best to be diligent about getting these numbers on the last day of your recording period. Since Instagram does not really have a “Share” option, we skip the Amplification rate for this medium.

# of Followers

Navigate to the “Statistics” tab in Iconosquare. Your number of followers is on the main Overview page.

# of Posts

Click on “Content” on the left side. Your # of our posts during each month are visible in the Distribution graph.

# of Likes / Comments

In Iconosquare, click on “Engagement” on left side. In the “Like Received” graph, mouse over the bar for the month to see the total number of likes.
For Comments, do the same thing on “Comment Received” graph.

# of Clicks to Website & Total Revenue

These last two values can be found in Google Analytics, same as above. Instagram traffic will most likely show up only on the “(Other)” channel, for whatever reason.

Now that you know where to find your measurements, and what to do with them (put them in my Measuring Social Media table!), I look forward to hearing about your insights. If you have better tools, please share, especially if they are free. It seems like most services are built for agencies managing multiple brands or big brands with big budgets, and not too much for us little guys. That’s why this DIY method seems like the best option for right now.

How I Increased our Holiday Sales by 87%

Posted on January 11, 2015January 9, 2015 by Maria in How-To, Marketing, Money, Sales

My post “How I Plan to Maximize Holiday Sales” from 11/18/14 outlined my strategy for cashing in on the holiday shopping season. Are you curious about how my plans worked out? Now that the dust has settled, I checked to see how well we did.

I pulled these reports with Quickbooks and Google Analytics. Details on how to do so are in each metric.

Google Analytics Acquisition>All Traffic>Channel report, comparing 2014 (Blue) against 2013 (Orange). This report shows Sessions (aka Traffic) and E-Commerce Conversion Rate.

Overall Goal: Double sales over 2013
Result: Overall sales increased by 87.2%. So not quite double, but pretty close.
Analysis: Of course it always burns a bit to not quite hit your goal, but overall I am happy with how the season turned out.
How I know this: In Quickbooks, I ran a Profit & Loss Statement (P&L) for the holiday time period and compared 2014 against 2013.

Goal: Double retail event sales by doing many more events
Result: Event sales increase by 98.7%. Hurray! Again, not quite the goal, but pretty darn close.
Analysis: We did a whopping 8 events (as opposed to just one in 2013), and that strategy obviously worked. That said, we were all pretty exhausted by the end of the month. Next year we’ll skip some of the slower shows and enlist more volunteers so we aren’t working seven days a week.
How I know this: In the same P&L statement from above, I filtered it for our “Retail Events” customer. We didn’t set-up a Retail Events customer until midway through 2014, but since we use Square for credit card transactions at events, I was able to figure out the 2013 sales with a Square sales report.

Goal: Maintain the momentum of increased traffic to our website by 56% over 2013
Result: Traffic increased by 62.3%.
Analysis: I attribute the extra bump in traffic to just more people being online and shopping.
How I know this: In the Google Analytics Acquisition Overview report, I compared 2014 against 2013. I refer to “Sessions” to represent inbound traffic.

Goal: Increase referral traffic by roughly 50% by being in more gift guides
Result: Referral traffic increased by 41.2%.
Analysis: Despite not hitting our goal, I am very pleased with how this strategy played out. Our e-commerce conversion rate from referral increased to an impressive 9.73% (compared to 0.41% in 2013), and of course that is a better metric than just traffic. We will push harder for gift guides next year, and get started on them earlier.
How I know this: In the same Google Analytics Overview report, then just clicking on the “Referral” line to dive into that report.

Goal: Invest in social media advertising to increase conversions.
Result: Our traffic from social increased an impressive 435.7% and our e-commerce conversion rate increased 214%. The vast majority of both traffic and conversions came from Pinterest.
Analysis: Obviously the Pinterest increase is a huge win, and interesting because we didn’t put any marketing dollars there. We did advertise on both Facebook and Google, and hardly saw a bump from those advertising efforts. Next year we will double down on Pinterest and try advertising there instead.
How I know this: In the same Google Analytics Overview report, then just clicking on the “Social” line to dive into that report.

Goal: Keep drop ship account momentum going, which had increased 74.1% over 2013.
Result: During the holidays, our drop ship orders increased by 132.1%!
Analysis: We offered our drop ship accounts limited-time discounts on certain SKUs so that they would have styles to promote during the big shopping days like Black Friday and Cyber Monday. We also changed to shipping every day (rather than just Monday, Wednesday and Friday) so that they can offer more shipping days.
How I know this: In Quickbooks, I ran a report under “Manufacturing & Wholesale Reports” called “Sales by Customer Type” and filtered it for the “Drop Ship” type. Note: You have to be using the Quickbooks Premier: Manufacturing & Wholesale Edition to have access to this report. Another method would be to just compare sales from these accounts from one year to the other.

Overall I am very pleased with how the holiday sales turned out. It’s great to end the year on a high note and to sell through a lot of inventory. For 2016, I want to reduce the craziness by getting a headstart on some of these initiatives, especially pitching the gift guides and our social media campaigns earlier on.

If you had particular success with any of your holiday marketing strategies, please share in the comments below.

10 Things You Should Know Before Starting a Maker Business

Posted on January 4, 2015January 3, 2015 by Maria in The E-Journey

I recently came across a post entitled 10 Things You Should Know Before Opening a Cafe on ladyironchef.com. I was surprised to see how many similarities there were between running a cafe and running a maker business, as I’ve always thought of service businesses and product businesses as completely different animals. Feeling inspired, I adapted her ten lessons to create my own take on 10 things to know before starting a maker business. *Note: I switched around the order of her points but kept the titles the same.

#1 The Owner Has to Be Hands On
Sure, this means all the grunt work that goes along with running a small business, like calling the post office to track down shipments, taking out the trash and sweeping the floor, schlepping box after box up and down stairs, in and out of cars, fixing the printer, fixing the network, answering angry customer calls/emails, etc.

Beyond the grunt work though, you have to be intimately aware of how each aspect of your business functions, and how it all works together, because you’re responsible for all of it, even if you don’t know how to do it. This includes everything from managing your supply chain to putting together human resource policies. If anything goes awry, all eyes turn to you, so you better know what’s going on.

#2 A Mountain of Paperwork and Admin Stuff
As someone said to me early on, if you want to spend your days designing things, get a job as a designer and don’t start a design business. I started my business because I wanted to design the products that I wanted to exist in the world. That’s still the case, I just don’t have much time to actually spend designing them, because I’m too busy managing my supply chain, sorting our human resource policies and fixing things to do it. Excel is open on my computer at all times, which I never thought would be the case in a million years.

Can’t you just hire someone else to do the things you don’t want to do? Sure, but keep reading…

#3 It is difficult – or almost mission impossible – to hire good staff
First, having staff costs money. A lot of money. Generally speaking, it’s best to have enough money for 4-6 months of payroll socked away to make sure you can pay people when your sales slow down. (Full confession: I don’t have this but sincerely wish I did. Skip down to #10 to see why). Revenue for a product company can come in waves, so you’ll want to be able to ride out those quieter periods and not lay people off.

Second, you have to know what the job generally requires before you pay someone to do it. It’s tempting to just hire someone to “take care of social media”, for example, but without know what exactly that entails, it’s too hard to align your expectations and to know how to measure her performance. So doing every job yourself, at least initially, is important.

Lastly, hiring is both art and science and is totally harder than it looks. My two employees at Po Campo are pretty excellent, but I’ve had some mis-hires too, and that’s rough.

#4 Motivating Your Staff
As the business owner and founder, you’re pretty devoted to making your venture succeed no matter what. Nobody else that works for you shares that devotion. Generally speaking, people like to do their job, do it well, and then go home. That’s why they work for someone else. That means that that inexplicable force that keeps pushing you ahead no matter what happens does not exist for the people who work for you, or, at least, not anywhere near as much as you feel it. You have to constantly be motivating them to try harder, push harder, see the bigger picture. You have to do that on top of managing suppliers and the mountain of paperwork and everything else.

#5 You Have to do a lot of Research about What You Want to Sell
One of my favorite parts of ladyironchef’s list was commenting on how there is a common misconception about opening a cafe that you mostly have to focus on the design and interior and then you’re good to go. I think we designers make a similar mistake about assuming that with a good product and good branding you’re good to go. Not true. Everything from your operations to your customer service policy has to be at the same level as your product and your branding or you are quickly discredited.

#6 Dealing with Suppliers will be your Worst Nightmare
This one really hit home for me. Suppliers suck! At least cut-and-sew suppliers do. Who would’ve thought it would be so hard to manufacture things, especially when you have a growing business and money to pay for everything. Po Campo has done more than 25 production runs and seriously something goes wrong each time. Bags aren’t made correctly, materials are substituted unknowingly, shipments come late, and it’s all like “tough luck”. (Before you tell me to switch to domestic production, please note that I have experienced just as many headaches with our US production partners as our overseas production partners). Most makers I know have similar experiences, but if you’ve had success with small production runs, I’d love to know about it. I’m always asking myself, “Is it seriously this hard for everyone to make things???”.

#7 Dealing with difficult customers
There are two types of people that you’ll have to deal with on a daily basis when running your business: vendors (suppliers) and customers. Customers are obviously key to your business’ success, but some of them can make your life so miserable! I’ve been screamed at, insulted and just plain treated rudely and unnecessarily harshly. Developing a thick skin without becoming too reptilian is a serious balancing act.

#8 You have to be at the cafe every day
Okay, this may be one area where it is a little different not being in a service business or not having a storefront. We have a pretty flexible work environment at Po Campo, in that I don’t have to be at the studio every day for it to keep humming along. That said, if there is a problem, I always have to be available. That means no complete vacation, ever. Have I worked on Po Campo each of the last 2,008 days? Yes. Have I taken “vacations”? Yes, absolutely. Since starting Po Campo, I’ve traveled several times to Asia, South America and Europe, all masquerading as vacation. And I checked my email and dealt with issues every day.

#9 You won’t have much time for yourself
You know that constant ticker tape on the bottom of CNN’s screen? That’s what goes on in your mind when you have your own business. Some of it is to-dos, some of it is business goals, some of it is managerial duties, some of it is turning a conversation with a difficult customer supplier over and over in your head. I get a glaze in my eyes that people call the “Po Campo face”. Once you go off on your own, commit to meditating at least 10 minutes a day to be able to operate like a half decent human.

#10 You’ll be constantly worrying
Obviously much of those ticker tape thoughts are worries. I’m going to use this last point to describe another omnipresent concern: death. Before starting my own business, I had no idea how close to death most small businesses are at all times. One extended street closure and that little shop that depends on foot traffic is dead. One big power outage and that online store runs out of cash and is dead. One faulty production run and that small maker business loses its most trusted customers and is dead. Sure, what doesn’t kill you makes you stronger, but it also makes you realize your own mortality, and how close you are to oblivion at all times. And that makes you worry.

How-To Use Surveys to Inform a Marketing Plan

Posted on December 21, 2014December 21, 2014 by Maria in How-To, Marketing, Research Methods

In mid-November, I was working on Po Campo‘s marketing plan for 2015 and realized it was largely based upon who we thought our customer was and what we thought she thought about us. We have a lot in the pipeline, both as far as new product development and marketing plans go, and I felt like it was time for gut-check with our customers to make sure we were on the same page.

Determining Objectives & Questions
I decided an online survey would be the easiest way to quickly check-in with our current and potential customers. From my past experience as a design researcher, I know that having concise objectives is key to a successful study. Using SurveyMonkey.com ($19/month for basic), I built a survey around answering the following questions:

We think of our customers as mostly active, urban minded women between 25 and 45 who live in bike friendly communities. Is that true?
We think “women-run”, “design-led” and “inventive combinations of style and function” are the brand attributes that resonate strongest with our customers. Is that true?
We’re developing yoga, baby and lifestyle bags and exploring wearables. Do we have license from our customers to stretch our brand into these areas?

I ended up designing a twenty-two question survey, which included a few more questions than necessary to answer the above objectives but it’s hard to resist the temptation of asking people things that you’ve been wrestling with while you have their attention. For me that included getting clarification on whether they see Po Campo as more of a bike, fitness or lifestyle brand to help us sort out our chaotic retail strategy and which brand archetype best suits us to help us determine tone of voice.

Insights from the Survey
We had 624 total respondents, mostly recruited through our newsletter list (88%) and Facebook (12%). Most respondents were existing customers (66%), while 30% were potential customers, in that they didn’t own a Po Campo product but were familiar with what we do.

For the first two objectives above, our assumptions were pretty accurate. We did learn that women value that Po Campo is a women-run business much more than men do, while men value that we are design-led much more than women do. That learning kind of plays into the stereotypes of men and women but so be it.

The answer to the third objective gave me pause: the majority of both our current and existing customers will probably not be purchasers of most of our new products as they do not engage in the activities we are designing for. On one hand, this is okay, because we can expand our pool of potential customers; on the other hand, marketing to a whole new group of people will be a lot of work.

Learnings from our secondary objectives were even more insightful as they challenged my existing perceptions of our brand. When asked what type of store environment would be the best fit for Po Campo, the majority of people (69%) chose either a bike store or a Athleta-type fitness store. The lifestyle boutique and designerly gift shop were much less popular answers, with 14% and 11% respectively. I always kind of thought of us as more of a boutique brand but our audience clearly has us in a more athletic context.

"Which of these store environments would be the best fit for Po Campo?" — “Which of these store environments would be the best fit for Po Campo?”

To help us determine our brand archetype, I asked a fill-in-the-blank question that said “When I think of Po Campo, I picture a brand that is all about…”. The clear winner to this question was the response that said “…being down-to-earth, reliable and trustworthy”, the answer that represented the “everyperson” archetype. I always thought of Po Campo as the Explorer archetype so this was something new. In researching the Everyperson, it does make a lot of sense to me, and has helped me understand the role we play in our customers’ lives better.

Action Steps
Analyzing research without laying out steps of action is a missed opportunity. Based on our research, this is what I will do next:

Research the new markets we plan to enter to confirm that our offering fills a need and is differentiated from existing products and brands. If it is, develop a marketing plan for each of the new product launches.
Revisit our marketing plan and focus it in on “active healthy living”.
Revisit marketing plan to focus on telling the “women-run” part of our story better, especially for content targeted to women.

Click here to see the complete survey. Please note that logic was included in the survey, so not all people saw all questions.

Have you conducted any surveys lately? What tips do you have to share?

My Kickstarter Experience

Posted on December 7, 2014December 16, 2014 by Maria in Marketing

Po Campo ran a Kickstarter for our Bike Share Bag in May of 2014. We met our goal in the first two weeks and ended up surpassing our goal by 56%, which was great. But it was a ton of work!

Background on why we did it
In October 2013, I started working on a bag to fit into the front basket of the bike share bikes in Chicago and New York, and other cities, to help you carry more stuff while riding, enabling you to use the bikes for more types of trips.

We were planning on launching the bag in May/June to take advantage of as many of the summer riding months as possible. In late February, I shot a video of the bag to share with the various bike share systems to see if they’d be willing to help me market it to their members. We decided to post the video to our Facebook page because we needed some content that day and a bunch of people saw it and shared it. Then the Huffington Post wrote about it, followed by several other publications.

So, here we were getting this great buzz in March but not being able to sell the bag until June. I wanted to do something to keep the momentum going, and doing a Kickstarter seemed like just the ticket.

In addition to piggy-backing on the media coverage, I thought Kickstarter could help us reach a new audience. Po Campo’s audience is mostly female, but bike share riders are mostly male, so effectively selling the bag would mean getting access to a more male audience. Kickstarter’s traffic is 72% male.

Plus, I had been feeling like Po Campo needed to do a Kickstarter for awhile, mostly because it seemed like every cool product company had done one and we hadn’t. I am aware that that isn’t a good reason but there you have it.

How we prepared for the campaign
May is National Bike Month, so we wanted to take advantage of that and run the campaign during May, thinking that the media would already be actively looking for bike stories that month. That gave us a little over a month to prepare.

According to Kickstarter stats, projects looking to raise between $1,000 and $10,000 are most likely to succeed. I chose a goal of $7,500, which was about 50% of the costs of the production run. I really wanted to make our goal and not stress too hard about it, and this seemed like a feasible amount. I knew I’d be able to cover the rest of the production cost with cash flow from the core Po Campo business.

Here’s what we did to get ready:

Added a “wait list” to our website to capture people who came looking for the bag after the Huffington Post article. I wanted to sell 25 bags the first day to these people, and figured we’d need at least 100 people on the waiting list to do so.
Scripted the video and recruited Sara Potts of Lady Lens Productions to produce the movie. The video took about 4 weeks to complete, from start to finish.
Brainstormed backer reward ideas and reached out to simpatico brands to collaborate with (most of these partnerships were scrapped for fear that Kickstarter wouldn’t accept our project).
Connected with all the bike share systems to tell them what we were doing and pitched ways they could help promote it.
Made a list of “influentials” in the bike share community and reached out to them to see if they’d be willing to take a photo with the bag.
Combed through our media list to identify journalists that seemed to be a good audience for our story and put a pitch together.
Made a week-by-week plan about which aspect of our project we would focus on each week to try and keep it fresh.

How Kickstarter became a time-suck
In the 4-5 weeks leading up to the campaign, I devoted about a third of my time working on it, or at least thinking about it. That’s a lot, considering our Kickstarter goal was just 2% of our projected sales for 2014. There’s just something about Kickstarter that demands a lot of your attention.

I thought that once we hit the “go” button that we’d be able to just relax and execute our plan, but that’s not what happened. Our campaign had a familiar curve, with a big spike the first few days and then slow growth after that.

I hadn’t anticipated how exhilarating those first few days would be and how you spend the rest of the campaign trying to recapture that thrill. Every day I would try to think of more people to ask to become a backer of the project, or to at least share it with others. I would go to every event and networking opportunity I could think of with the bag in tow to tell people about what we were doing. I probably continued to spend a third to a half of my energy on the campaign, which is ill-advised. It was like I was in a Kickstarter vacuum and everything else came to a standstill.

What I would do differently next time
First, I would NOT make my email address the destination for all the notifications. Getting the emails of new backers would get me too excited, while a lull in new backers would bum me out. One can not effectively run a business when on an emotional roller coaster like that.

Second, I would start the planning and media pitching much earlier, maybe six months in advance, so as to not scramble during the campaign. Like all marketing, it always surprises me how many people you have to tell to get any traction at all.

Lastly, I would choose a project that was newer for us, or something that challenged us more, where we could invite our backers along with us on the journey. I felt like we were still just making a bag – I mean, a really cool bag – but nothing too different from what we had done before. Candid updates from the Kickstarter creator are some of the best aspects of backing a project, but because our process for making bags was already pretty established, it was hard for us to make this process very exciting.

If you’ve done a Kickstarter project, was your experience similar to mine? Share in the comments!

Dealing with Entrepreneur’s Anxiety

Posted on November 30, 2014December 13, 2014 by Maria in Marketing, Sales, The E-Journey

I started blogging about my experience of building Po Campo three years ago but I only began regularly posting this past summer. I usually base the topic on something that I’m presently focused on, whether that be grandiose big picture things or nuts-and-bolts executional things. As far as I’m concerned, it’s all fair game and all part of the entrepreneur’s life.

Well, this weekend I drew a blank on what to write because I spent the last week doing little other than being overwrought about how much we would sell between Black Friday and Cyber Monday. I wish I could tell you how I managed to overpower the anxiety in the end, but I can’t, because I haven’t. However, I am going to hold true to the promise I made to myself to post every week, which means that while anxiety about Christmas sales is not the most interesting topic, I suppose I will just have to write about that, because it’s all I can seem to think about.

The core of my anxiety is that our December sales need to be good to end the year with a profit, a goal that has eluded me for the last five years. In addition to just making me feel like I am doing a good job at running my business, being profitable would increase my likelihood of getting a bank loan, or some other kind of financing, so I could start to improve my balance sheet. There’s nothing I’d like more than being able to pay back some of those early friend and family loans that make me feel guilty and some of that high interest credit card debt that just makes me feel like a loser.

I put together a solid holiday marketing strategy to hit our sales goals, but that has apparently done little to assuage my anxiety. When I’m in a state like this, I feel paralyzed by my inability to control the outcome of a situation, and so I sit around watching movies until an idea strikes me (Change up the card abandonment email! Reactivate the Google remarketing ads! Think of another clever facebook post – and boost it!), in which case I jump up and do that post haste. I don’t feel like there is time to do the things that normally help me feel balanced, like yoga or cooking or socializing, because I feel too busy, when in reality I’m just waiting…for something.

December 13 Update

Holiday sales are going splendidly, thank you very much. Our last shipping day is Dec 19, which means by this time next week, I’ll be ready to sit back, relax, and enjoy the rest of the holiday season!

Why I don’t manufacture in the USA

Posted on November 23, 2014November 23, 2014 by Maria in Manufacturing

There is a lot of talk nowadays about manufacturing in the USA and “reshoring“. Part of me applauds these efforts and part of me, remembering my own difficult time with domestic manufacturing, thinks that not only is it not possible, but not something anyone in her right mind would wish to do.

Then I wondered if my experience with domestic manufacturing in the cut-and-sew space was typical. To fin out, I’m sharing my experience with manufacturing in the USA, which we did from 2009 through 2011, and why I’m not overly eager to try it again.

When I first hatched the idea for Po Campo in 2008, I was very keen on the idea of producing our product domestically, if not locally. This was before there were resources like Maker’s Row around to help you figure out how to do it, and it was much more difficult than I had ever imagined it would be.

Unlike overseas manufacturing, where the factory does all the sourcing of raw materials for you, in the U.S. you typically have to do all the sourcing yourself. So, there are two parts of the manufacturing process: the sourcing of the raw materials and then finding a factory to construct your product.

Sourcing Raw Materials
Once we had good samples of our first products, we were able to make a thorough Bill of Materials (BOM) and start the hunt for suppliers. Our bags had about 25 different components each, so there was a lot of hunting to do. We turned to Google and Thomas Register to start contacting companies.

Our first lesson was that the MOQs (Minimum Order Quantities) for raw materials was much higher than we needed. Dying/printing custom fabric was upwards of 5,000 yards when we needed 100 yards. Buying bulk webbing (straps) in custom colors had an MOQ of 1,000 yards when we needed 400 yards. Trying to get hardware at an affordable price required a purchase of at least 1,000 pieces when we needed about 200 pieces.

We tried to tweak our designs to require fewer materials, but we were still nowhere close to hitting the minimums. Therefore, we had to purchase most materials “off the shelf” and pay 50% to 100% more for them, forcing us to both raise our price and reduce our profit. In some cases, we ended up purchasing materials directly from Asia, either because we could not find a vendor in the U.S. or because it turned out to be less expensive, even with exorbitant shipping costs.

While we were eventually able to source all of the different materials, they all came from different suppliers with different terms and different minimums, resulting in a very complex supply chain. Also, the raw material vendors could be difficult to work with. They were often rude to me on the phone, treating me like a small-scale nuisance and/or a stupidly naive girl rather than a true customer. They were also technologically unsophisticated: ordering by phone or fax was much more common than ordering by email or online, which made ordering a lot of material hard to do when you had a full-time job elsewhere. In short, buying materials was a pain in the butt.

Producing the Product
Now, onto the labor side of the equation. The greatest benefit of working with a local factory was their proximity. Sample making was a collaborative process, where they would make a bag according to our drawings and then we would visit and discuss improvements together. Our factory was about a 20 minute drive from my office (I still had my day job), making it close enough to swing by over lunch if I had to.

A common complaint about overseas factories is that they are always late but we experienced the same thing with our local factory, which makes me think it is just inherent in the cut-and-sew world. You may think that you can go down to the factory and stomp your foot enough times to make them finish your order, but that just wasn’t the case. If they had an order from a more valuable customer (read: larger) to finish first, they would.

Another problem we experienced was running out of materials. Despite building the BOM together with the factory, we would inevitably get a call midway through production that they had run out of something and could not continue. We would rush to track down more of it, often paying a small order surcharge or purchasing way more than we needed to to keep production on track. I don’t think the factory purposefully wasted materials, but since their profit was in how quickly they could sew things, it was in their best interests to cut corners on efficient material usage in exchange for construction expediency, and we paid for it.

Pricing Problems
Because of the higher costs of both the raw materials and the labor, our margins were so-so, around 34% (industry standard is 44%) or less, sometimes much less, depending on how much the raw materials cost that go-around. That meant we would have to sell more bags to make enough profit to grow the business as we wanted.

Yet, it was hard to sell bags. We got a lot of encouragement and oohs-and-ahhs, but we were told over and over that our prices were just too high. Our efforts to streamline the design to simplify production resulted in a simpler bag that we were still charging too much for.

The high price of the bags affected other aspects of the business too. We learned that since our product was so new and different that we needed to invest more in marketing. We originally planned on giving influential bloggers and journalists a bag for them to review, but our bags cost us too much to do this at a large enough scale to make an impact.

I started feeling that the only thing I liked about manufacturing in the US was being able to say “Made in USA”. But if the process made me miserable and we weren’t able to sell enough to stay in business, why were we doing it?

Deciding to Make a Change
After another disappointing sales season in Spring 2011, I decided to test the notion that our sales were slow because our bags were too expensive. I dropped the price as low as we could to see what would happen. Our online sales went up over 400% the first month and stores started reordering for the first time.

The experiment confirmed that our price was a big hurdle to purchase, and reducing our cost by 35% or more was not going to be feasible with the way we were doing things. Even if we went to a different city in the U.S. with cheaper labor prices, our raw materials costs, which made up about half of the total cost, would stay the same. Expecting to save 35% on labor alone, regardless of where it was made, was unrealistic, or unconscionable, as workers would likely be working in sweat shop conditions, which are sadly not unheard of in the USA.

Since moving our production to Asia, we have had our fair share of problems. Shipments have been late, sometimes devastatingly so, and we have had quality issues here and there. However, it is much easier to produce the bags that I want to make (and that our customers ask for) because not only is there a wider array of materials available, but I also have access to the latest in cut-and-sew technology. Our profits are much healthier, and, as a self-funded business, this makes all the difference in the world. Some of the things I’m most proud of with Po Campo, like hiring a good team and our partnership with World Bicycle Relief, would not be possible without those profits.

Would I ever consider producing bags in the USA again? You bet. I think about it all the time. But I don’t want to go back to the way things were in the early years of Po Campo, where it felt like we were slowly marching towards an inevitable death.

Is Cut-and-Sew in the USA Realistic?
Learning from other brands that successfully produce in the USA, if Po Campo were to “reshore”, we would need to change our distribution strategy (i.e. only sell B2C) and own more of our supply chain. We’d likely need to raise our prices and sell to different customers too. Essentially, we would need to develop a new business all together. Oh, and I would definitely need to procure enough capital to give me a multi-year runway, and access to capital has not been easy for me.

Now that I’ve shared my sordid tale with you about my experience of making in the USA, I’d love to hear about your experiences. Did you encounter similar road blocks that I did? If so, how did you overcome them?

How I Plan to Maximize Holiday Sales

Posted on November 16, 2014November 15, 2014 by Maria in Marketing, Sales

One of my favorite things about being in business for a few years is that you have a sales history that you can refer to when you are doing your planning. It sounds horribly geeky but having to guess about when, where and how you’re going to get sales is the absolute worst. Case in point: how much money can I hope to make this holiday season?

Like most consumer good companies, I hope Po Campo will cash in on all the holiday shopping activity. Below are our sales trends over the last two years. After a spring/early summer spike, you can see that the holidays are our second highest sales season. Our retail (i.e. B2C) sales have roughly doubled this year over last, and I’m banking on that trend continuing through December. Rather than just hoping for the best, I checked our data from last year to see what worked the best so that we can focus our efforts on activities with a high ROI.

Po Campo's sales history over the last two years — Po Campo’s sales history over the last two years

First I look at our Quickbooks file to see where last year’s holiday sales came from and discovered that 78% came from retail sales, with the remainder being wholesale drop ship accounts.

Step One: How to Maximize Retail Sales

Focusing on the retail sales, about 30% of those came from doing holiday shopping events. We are doing several more shopping events this year, so I feel pretty confident that we’ll be able to roughly double that amount.

The rest of our sales came from our online store. To learn more about those sales, I looked at our Google Analytics acquisitions report for last year’s holiday shopping season to see where the highest converting traffic came from.

Po Campo's converting traffic from last holiday season (Nov 15 - Dec 31) — Po Campo’s converting traffic from last holiday season (Nov 15 – Dec 31)

70% of our conversions came from people looking specifically for Po Campo, either typing pocampo.com into the URL bar or searching for Po Campo, or a variation of our name, in Google. My first thought is that these are people come to us already knowing what they want, so can I expect this number of visitors to double this holiday season?

To make an educated guess, I run a report comparing this year to last year. Our traffic is up by 56%, but our conversion rate is down by 19%. Therefore, if those trends continue through the holidays, I expect our organic and direct traffic to increase somewhat, but probably not double.

Next, 19% of our conversions came from referral traffic, mostly blogs that had included a Po Campo bag in some sort of gift guide. I know we are going to be included in some of the same gift guides this year, and it’s a little too late to make any more pitches. However, we have started some strategic partnerships with various groups, affiliate networks and analogous brands that should increase the amount of referral traffic we get.

Lastly, 7% of our sales came from social, almost entirely from facebook and Pinterest. Both of these platforms have greatly improved their targeting and reporting tools over the last year, so while I’m not able to glean much information about was successful last year, I think there is an opportunity to run some promoted posts to increase conversions this year.

Most of these tactics for pocampo.com are underway, with the exception of the facebook and Pinterest optimization. Researching that is now on my to-do list for next week.

Step Two: Drop Ship Accounts

Secondly, I ponder the drop ship accounts. Generally we just let them run on auto-pilot and focus most of our attention on our own online store. However, these drop ships have grown into a decent size business for us this year and I’d like to support them as they push for holiday sales as well. I brainstormed some promotion ideas with my team, including:

Developing content that they can just plug into their networks. Our expertise is in inventive and inspired products for modern city living, in particular integrating the bicycle into your life, and this is something we’d be happy to share with them.
Using our reflector pins as a gift with purchase (commonly called GWP) during certain periods.
Offering longer return periods
Offering special promotions

Knowing that time was of the essence, we sent these ideas to our contacts to get their input. As I feared, we were too late to be able to do much, especially with the larger sites. Not to let this lesson go to waste, I added a reminder to our 2015 calendar to look into this with our drop ship accounts in late September/early October instead.

Maximizing Holiday Sales Strategy

Here is what we still have time to do this year:

Promote the heck out of the holiday events we have planned this year
Activate our Google Adwords that target the common misspellings of our name (like Pro Campo or pocampo) and turn on our remarketing ads to make sure we stay top of mind to people who visit our site.
Increase traffic from facebook and Pinterest
Promote the gift guide exposure
Identify partner marketing opportunities with our simpatico brands
Continue to talk with drop ships about highlighting Po Campo

I look forward to sharing how successful we were in January! What are you planning for your last minute marketing push?

Running “Quickbooks Reports”
Po Campo uses the Wholesale and Manufacturing version of Quickbooks Premier. We set up our different revenue sources as Customer Types and these include: Retail, Drop Ship, Wholesale, Distributor and Discount. Running the “Sales by Customer Type” report (Reports > Wholesale & Manufacturing Reports > Sales by Customer Type) displays how your different revenues streams perform against each other over a period of time.

I didn’t discover this report until this year and now it is one of the ones I look at most often!

Is “Taking the Plunge” Worth It?

Posted on November 9, 2014November 8, 2014 by Maria in The E-Journey

A couple weeks ago, a friend asked me to lunch, saying she was weighing an important decision and wanted my input. The important decision turned out to be whether she should quit her high paying job that was fine enough but not fulfilling for a very low paying job working for a nonprofit that she really believed in. She knew I had quit a high paying job to work on Po Campo, which pays me very little, and did I think it was worth it?

Of course I gave her the enthusiastic “yes!” that I give to everyone who asks me this question. I offered up the usual reasons of why quitting a good paying job or leaving a career is actually not as scary as it may seem: you can always go back to the old career later, you have savings to help you transition to a lower pay, you don’t actually need that much money anyway, and what’s the worst thing that could happen anyway? It’s not like it will kill you.

She ended up turning down the new job and staying put, saying that it just “made more sense”. I don’t blame her for that. It did make more sense. Yet, I had to admit to myself that I was disappointed to hear her decision. Why?

At first I thought it was because misery loves company. We romanticize the thrill of “taking the plunge” but in all actuality, it sucks most of the time. Well, starting a bootstrapped business does, anyway. It’s stressful. It’s tiring. It’s thankless. It apparently never gets easier. I treasure my relationships with my fellow bootstrapped entrepreneurs because they are the only ones who can sympathize with my struggles and whose encouragement to keep going matters most.

But why would I want my friend to share my misery? And am I really miserable?

No, of course I’m not miserable. I would even describe myself as happy.

When I started Po Campo, I made a pitch to a colleague to join me in my venture. The first slide had the Gandhi quote “Be the change you wish to see in the world”. Despite all the hardships I’ve faced since quitting my good job and taking the plunge, overcoming the challenges with starting and growing a business have definitely made me stronger and more confident. I know the future will be similarly tough, but I feel ready for it. I feel more in control of my destiny and I believe in my ability to change the world, at least my little corner of it. Before Po Campo, I had hoped that I could be a positive influence on the world someday. Now I know that I can. And therein lies my happiness.

So, maybe I was disappointed with my friend’s decision because I thought she was going to miss out on experiencing this source of happiness. But honestly I don’t think so. I think I was disappointed simply because I thought it would be another thing we could share, just like our love of recycling and our love of foreign travel. I’m glad she chose what was right for her.

I’ll close this post with a quote from Henry David Thoreau from Walden:

“I learned this, at least, by my experiment: that if one advances confidently in the direction of his dreams, and endeavors to live the life which he has imagined, he will meet with a success unexpected in common hours.”

The inspiration for this post came from a lovely interview with designer/artist Elle Luna on The Great Discontent. I recommend reading it.

Why I don’t use a Fulfillment Center

Posted on November 2, 2014November 2, 2014 by Maria in Operations, The E-Journey

After 2.5 years, Po Campo is getting ready to move into a new home! And we’re taking our warehouse with us. There are many places that will warehouse and ship your products for you, so why are we doing it ourselves? You need more space, you have to stock a lot of shipping supplies, and it takes a lot of effort.

Short answer: Because we always have. And I kind of like it. And it’s cheaper.

When we started Po Campo, we were making just 200 or so bags at a time. My co-founder and I didn’t have space in our apartments to store them, but my parents lived in a nearby suburb and, as empty-nesters, that had plenty of space and liked the thought of helping me with my business any way they could. We trained my parents on how to ship orders and they would dutifully take care of that for us. We did this for the first 3 years of Po Campo’s existence.

Once we started importing the bags in 2012, we were getting 8,000 bags at once, rather than at most 500. Clearly that was too much to keep in my parents’ basement, so I started looking for a warehouse space. My friend Annie of Mohop shoes was setting up shop in a raw commercial space and had extra room so we moved in there.

Looking back, this would’ve been a good time to outsource the warehousing but honestly it didn’t cross my mind. I don’t know if it is because I didn’t know fulfillment centers existed or because I wasn’t ready to let go of it yet. Our operation still seemed pretty small scale.

As it turned out, our first production run from China had a lot of issues. We had to hand inspect every bag before shipping it out, which we wouldn’t have been possible if we had had outsourced it.

As the business grew, shipping and fulfillment became more complex. We established processes for shipping items from our online store, how to handle drop-ship accounts, how to export, how to work with different stores’ vendor routing guides (basically very specific instructions on how you ship products to them). We negotiated better UPS rates and got discounts for shipping supplies. We installed software to better manage our inventory and sync with our online store and Quickbooks. I always thought it took my parents so long to ship bags because they were older and slower to learn new things, but it turns out that shipping actually takes time and effort!

However, our office/warehouse space had some downsides. It didn’t have a loading dock and we were in the basement, which made moving pallets in and out with the freight elevator a pain in the neck. Also, it was horribly cold in winter and just kind of crappy overall, with flickering fluorescent lights, cracked cement floor and lots of spiderwebs. We were ready for an upgrade.

I was picturing moving into a cool lofted studio space that we could use for an office and maybe a showroom and then outsourcing the warehousing and fulfillment. I shopped around and found some suitable fulfillment companies, but after getting estimates on the cost, it turned out to cost about a third more than we were paying to do it ourselves. (See how most fulfillment companies charge below). Was it worth it?

I decided it was wiser to just move the warehouse into a better space. After looking at other warehouse spaces, I realized our warehouse was actually pretty small, and could be even smaller if we found a place with taller ceilings. I’m happy to say that I found the kind of lofted studio space I was originally dreaming of, and it’s large enough for a small office and warehouse. I think this space will hold us just fine through the next period of growth, and which time we will reassess.

Packing up our current warehouse, getting ready for the move.

Things to think about when deciding if you want to self-fulfill:

PROS
– You can make sure it is done right (mis-ships from fulfillment centers are not uncommon)
– You can access your inventory easily, should you need to do pop-ups, retail events, or sales calls
– You can customize your shipping process on the fly, e.g. if you want to add gift tags for the holidays
– It’s nice to have your product around you because it’s tangible proof that you’re making things
– It’s often cheaper, assuming you’re not paying for a high rent space. Rawer, commercial flex-space is about half the cost of office space.
– If there are any problems with your product, you can catch it before sending it out to your customer.

CONS
– It’s very time-consuming and you’ll probably want to hire someone to do it. A college student will suffice.
– It’s more complicated than you’d think. You’ll have to learn about how shippers work, how to get the best rates and how to do the appropriate documentation.
– Depending on your product, it can take up a lot of space. Plus, you’ll need to stock shipping supplies. This isn’t feasible if you live in a high-rent area. Fortunately, Chicago has many affordable spaces in good locations.
– You have to be there to do it. I always dreamed of a virtual office, but storing physical inventory means that someone has to be there everyday to ship it out.

Example of Fulfillment Center Fees
– Rent, for how space you take up in their warehouse
– Picking fee, for every time someone has to pick an item off the shelf or out of a box
– Receiving fee, for every time you send new inventory to them
– Packaging and shipping materials, like boxes, tape, etc.
– Pallet loading fees, if you are shipping out product by the pallet
– Order processing fees, if they have to log-on to any accounts to download orders
– Labeling fees, if your customers require specific labels or bar codes
– Paperwork fees, if your shipment requires special paperwork, such as for exports
– Returns fee, if your customers send back unwanted product directly to the warehouse
– Shipping account usage fee, if you ship using their UPS/FedEx account

This is more specific than how I account for fulfillment costs in our system. I just have two line items in our books for fulfillment: Shipping costs (i.e. UPS) and fulfillment costs (i.e. shipping supplies and the hourly wage of the person who’s doing the shipping). When I was comparing the cost of doing fulfillment ourselves versus outsourcing it, I went through the painstaking process of determining how much we would’ve spent had we priced everything like an outside fulfillment center does, which is how I found out it would’ve cost roughly $500/month more to have someone else do it.