257 – Intentionally Creating a Customer Experience Matters with Laura Jennings of Knack

You're listening to gift biz unwrapped episode 257 really to me,

starting a business is about being fearless Attention gifters,

bakers, crafters and makers pursuing your dream can be fun.

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Here is your host gift biz gal,

Sue moon Heights.

Hi there,

it's Sue and I'm So happy that we're back together again

today. If you're a first time listener,

welcome. I'm thrilled to have you here as well.

Top order of business today is an announcement you,

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Help is on the way go sign up for this masterclass@giftbizunwrapped.com

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forward slash masterclass today's guest comes not only from an entirely

different industry into the gifting world,

but she transitioned from a digital technology space to a product

based business that's a big switch.

I often say that when we focus solely on our individual

industries, our vision becomes tunnel focused and limited.

Here Laura uses her past expertise to add depth and differentiation

to her new business,

which by the way,

like many of us was started from her basement.

You're going to hear how Laura began with an analysis of

her market,

how she focused on a specific part of the sale that

led to the core value of her business and a host

of other important topics like hiring,

product development,

fulfillment and growth.

Here we go.

Today it is my pleasure to introduce you to Laura Jennings

of NAC.

After a career as a senior exec at Microsoft and that

is a venture capitalist,

Laura decided to build an eCommerce business around celebrating the customer

as a creative force.

Every gift they send out at NAC is made to order

whether it's one gift or thousands.

Each gift on the website is easily customizable and their exclusive

gift builders system allows customers to create completely unique gifts from

scratch, as if that's not valuable enough.

They also have a shop by ethos feature that allows customers

to find products from companies who share their values.

This could be supporting a female led business,

focusing on sustainability produced products or contributing to a business.

That gives back to a specific cause.

This business sounds so fabulous,

Laura. I'm so excited to dive in.

Welcome to the gift biz unwrapped podcast.

Oh, thank you for inviting me.

I cannot wait to talk with you further and learn what

all of this is about.

And I love your website.

PS, I'm saying that right in the beginning here,

but before we get started,

I want to ask you a question that's become a tradition

here on the show.

And that is to have you describe yourself by way of

a motivational candle.

So if you were to share with us a little bit

more of who you are by a color and a quote

on a motivational candle,

what would that look like?

One of the things that I think is true about me

is that I have an ability to make things more complicated

than they need to be.

And so my candle would really start with the meaning behind

it, who made it.

And so what's important to me is that everything I do

is very intentional and as leveraged as possible.

So my ideal candle would really be made by someone who

I'm helping in some way.

So that really would be the core of it.

And the part that really is meaningful to me in terms

of color,

my favorite color has always been yellow.

It's very optimistic,

it's very positive.

And really to me starting a business is about being fearless.

And so that would be my motivational saying,

Be fearless and being fearless.

In what way?

Give us a little more context to that.

Well, I think first daring to think big,

so I have a business that I started in my basement,

which has now evolved quite a bit and also being fearless

about failure because inevitably when you put yourself out there and

create something from scratch,

the risk of failure is very high.

And that can be personally embarrassing and professionally embarrassing.

And so I think it's both of those things.

So you and I already have a lot alike because my

favorite color is also yellow.

And I started my first business from my basement too.

So that's just kind of funny.

Yeah. But take us back to before NAC.

So you had a corporate career for a while.

I did share us a little bit about That.

So I was fortunate enough to go to Microsoft before really

they were successful.

I mean,

in the early days,

that was a crazy time and it was a time of

such rapid growth that all of us in the company or

taking on larger roles maybe before we were ready.

So everything I did,

although it was a big corporate structure and Microsoft during the

course of my tenure,

it became a very big company.

Everything I did was about growing things.

dating myself a little bit.

Yeah. But in those days,

the Microsoft office only existed on the Mac because we did

not have applications on windows yet.

In order to put that together.

And although we think about the Microsoft office as this staid,

enormous, successful business,

it was actually a controversial idea when we first launched it.

After that,

I grew that email business,

although we were running our company using email.

Email really was still not widespread in business.

And so we acquired a little company in Vancouver,

Canada that was doing about $8 million a year in revenue.

And I grew that business up to about one 75 million.

And then I moved into other emerging businesses,

the largest of which was MSN.

So I ran MSN for about three and a half years

during the early days of that.

And then my final job at Microsoft was the vice president

of worldwide strategic planning.

So although I was in a big company,

really my background and where I've always gravitated is to the

building process,

taking a business and growing it.

And that's what interests me,

not running something that is already large.

Very interesting.

And I'm sure so applicable as you went off then on

your own.

So nice to be able to kind of get your feet

wet and really learn and especially,

you know,

who knew Microsoft was going to grow to the size it

did when you first started.

But I can only imagine all of the knowledge that you

got all those years had to really help.

Yeah, exactly.

And you know,

when I went to Microsoft,

that's why I had gone to business school.

I had an undergraduate degree,

worked for a few years,

went to business school,

then went to Microsoft and when I went to Microsoft I

was actually making less money than I had made before.

I invested all that money in business school,

but it just felt right.

You know,

that sort of entrepreneurial feeling.

It just felt like the right fit even though it was

by far my lowest financial offer,

but I went with what felt right and that worked out

okay. The other thing I want to say about that experiences,

I went from that to being a VC,

so as a venture capitalist I sat on many,

many startup boards and had a really front row to that

process. However,

I will say as well prepared as I thought I was

to start my own business.

Really doing it from scratch as you did as I did

really is a completely different thing.

I'm really glad that you said that.

While there's two things here that I think are really great

and we see this all the time in different ways.

Your corporate life gave you so much knowledge.

And I think there's people who are listening to us right

now who might even have their earbuds in in their cubicle,

you never know and are listening and are trying to figure

out a way where they could start their own business and

possibly have it replaced what they're doing now.

And I think they discount all of the knowledge and learning

and skills that they're getting from whatever they're currently doing.

So you bring this up as an example that this has

helped you pave the way.

Although I did also hear it didn't pass me by that

you're still not ever fully prepared and I'd be interested to

see what you think about this.

But I kind of always thought that once I got my

business established and up to a certain level,

then I'd know everything.

It would run smoothly.

There'd never be problems.

Right. Yeah.

And I finally figured out there are always going to be

things that come up.

Do you feel the same way?

Absolutely. And the problems might change,

but growth and success itself has,

it brings its own set of issues.

I certainly haven't hit the point where I know everything.

I don't think we ever do.

Plus the world is changing around us so quickly that even

if we got to that point,

then we'd have stale information because it's just going so fast.

That's true.

So, and be honest,

I think that would get boring.

I mean it might feel good for a little while where

you can breathe and just know that everything's going to stay

status quo,

but at some point there's no challenge anymore.

I think that's right.

I think the sort of person who starts a business that

is absolutely true.

So we've had the luxury of growing enough that I have

a number of employees and I've interviewed a lot of people

and when I try to describe what it's like to be

in a startup,

everybody says,

Oh yes,

yes I want to do that.

But the reality is not everybody does that.

There is a risk tolerance.

There has to be a capacity to handle chaos and to

make things up and then to retrench when the things you

made up didn't work.

That is for someone who wants to start or wants to

work in a business.

Once they help grow something,

those are really important characteristics.

The glass is always half full and challenges are like,

Oh that's interesting,

let's figure that out.

But that doesn't work for everybody.

So I think what you say is true,

but I think you need to really be honest with yourself

about what type of environment you really thrive in.

And it's not a right or wrong,

but really building something from scratch requires a certain personality type.

Such valuable information.

Laura, just giving that notice,

self reflection.

Are you the type of person who would be able to

manage through these types of situations because what you described is

absolutely reality,

no question about it.

Yeah. So at what point did the idea of NAC enter

into your mind?

Were you still working at that point or tell us about

how it all started?

No, I wasn't working at that point.

I had just had my fourth child.

I had been actually helping a startup for a while.

But really when I think about the roots of nag,

if I think about my career,

I've had the luxury really of experimenting with this idea of

how do people use technology to work together for a very

long time.

Even really starting with the Microsoft office and then of course

at MSN.

And so I've watched the evolution of commerce on the internet

go from selling things to marketplaces,

to double-sided marketplaces.

And to me having this kind of a longer view,

it seems to me that power and control are inevitably going

to move closer to the consumer.

So to me,

I've been thinking about this idea of where are we heading

and what was important to me in starting knack was this

idea of how do we make the consumer themselves a creative

force? How do we celebrate that?

How do we give them the tools they need to create

exactly what they want in a way that is accessible and

not overly complicated.

It's interesting to me,

unless there's some portion of your past that I'm not familiar

with yet,

that you switched though for more informational product to physical product.

Yeah. And that has been a real growth experience for me.

You're exactly right.

I come from a world of software world where once you

build the software,

you're basically finished,

Right? Your investment is in the development and growth and then

the monetary rewards come after that where with product you've potentially

inventory more labor,

et cetera.

Exactly. And that was an area where I really had to

rely on other people.

So the first thing I did was hire a consultant and

we went through sort of merchandising one-on-one.

And so tell me what are the jobs in a merchandising

department? What do people do?

How do you think about it?

What are the tools you use to manage that?

So I really had to educate myself and even that wasn't

enough. I made sure from the beginning that I hired people

who knew how to do that.

So my very first chief merchandiser had come after a long

career, both at Nordstrom and then in other industries.

And I really have relied on having somebody in my organization

at all times who brings that knowledge because they've,

they've lived it and they've been trained in that environment.

I like your description of the development too.

You went out and ask questions of someone who knew,

so you knew the different types of positions.

I guess I'll say that you needed to fill,

you knew what you were just familiar with and then you

went out and filled it with people who know instead of

you trying to figure it all out.

Exactly. I knew that I didn't even know who to hire,

so I found a consultant who I needed to get the

lay of the land to even figure out what I needed.

What was the profile of that sort of person?

Did you have connections from the past that helped you find

somebody? Well,

I live in Seattle and the sort of place where you

might not know everybody,

but you know someone who does and so I think being

in this environment was helpful because I had been a VC.

I also knew a lot of people in the startup community

and they were very useful.

I think I found my first consultant as a referral from

somebody that I knew in my previous life.

As a VC.

That's an important point unto itself.

Just connections,

you know,

where different connections can take you.

You have to ask the questions.

Exactly. Yeah.

Maybe we can come back to this later,

but I think when you're starting a business,

those connections are so important because you don't have the infrastructure

of an organization behind you.

And even to this day,

I'm part of a group of all female CEOs who get

together once a month.

And the energy I get out of that group,

that ideas,

the energy,

the support,

that contacts are just immeasurably important to me.

How much time did you take actually planning and preparing and

building a business plan if indeed you did give us a

little insight into that before you actually got things up and

running. So I would say that I thought about it for

too long before I did it.

Oh, that's interesting.

And then what I did do next is I put together

a little test,

so hired some consultants to build enough of a software rig

that I could do a popup store.

So there's a downtown mall here in town that I did

a popup store at holiday in a very central location,

purchase some inventory,

and it had really set that up as an experiment.

I set it up so that people could interact with this

idea of creating your own gift in multiple ways.

And then we observed what did people gravitate to.

The most important thing we learned in that popup store is

what did it mean for someone to make something?

Where is the point at which the customer feels ownership?

Because there were lots of ways we could have gone forward.

And so that test case was really important.

So we did that and then after holiday we used that

information to then build the business plan and wireframe the actual

software platform.

So did you feel like identifying the point where a customer

felt ownership equated to more probability of them completing the order

or the sale?

Yes, but I want to step back for just a second.

Everybody has in their history,

given someone a gift that they think is so perfect that

they can't wait for that person to open it.

It's the best feeling in the world.

It just like,

you know,

you nailed it,

you are so excited.

You could just barely wait to give them that gift.

That is what I was trying to accomplish.

What is it about that?

Does the person need to touch it physically?

Do they need to have gotten the items themselves and put

them in and made the box?

Or is it about choosing or is it about the ethos

behind it?

And so that's really what we were trying to figure out.

What is the point at which our customer feels fabulous?

Like I nailed this gift,

I'm so excited to give it.

So that's really what we were after.

And then the part about it is the conversion rate go

up or do they complete more often?

That really is secondary.

But we were very focused on trying to give them that

experience of ownership and joy because that when you do find

the perfect gift for somebody,

it feels so good.

Right? And if you're not quite landing it,

then you just keep creating until you have that perfect gift.

Right. So interesting because you know,

there are other types of companies that I would put things

in boxes and offer boxes of product by category and all

that, but not so many that allow you to customize and

for sure not to the level that you're doing.

But the thing that I really like,

and I'm pretty versed in both the gift basket slash gift

box industry and I haven't heard anybody really talk about it

the way you are,

where you're going after the feeling of the purchaser and the

experience that was your driver from the beginning,

which is brilliant.

Well, and I think that I came at it because of

my background from a completely different direction.

So I came at it from how do we build around

the consumer as our central point?

So this idea,

yeah, there are other people who have environments where you can

build or make changes,

but that's everything we do.

It isn't the court,

it is our true North that when we make decisions that

the part where we're celebrating the customer as the creative force

is always the center.

And so we invest in way you see that manifestation on

our website really reflecting that.

And other people came at it from a different direction.

It's not a right or wrong,

but yeah,

that is really what is unique about us that we were

formed around this idea of everything is made to order and

we will always be that.

That's the core of what we do.

It's not,

Oh yes.

And by the way,

if you don't like what we have put together,

we have this other thing.

So would you say that the product is secondary to the

feeling and the experience of the creation?

That's a good question.

Maybe if I had to really push,

but they're so close together because you talked about in your

intro, this shop by ethos feature,

at least I can talk about as a gift or I

tend to,

when I give somebody a gift,

I have a reason for it.

So I gave you this because I picked this because,

and when we think about gifts that we remember,

we don't remember the items so much.

We remember how it made us feel.

Right? And we remember the story.

So let's take,

let's say I come to visit you and you invite me

to your home and I bring a bottle of wine that's

very, very nice.

But if I walk in and I give you that bottle

of wine,

and I say,

so I'm so excited.

This is the wine that my husband and I drank on

our honeymoon and we found a case and I want you

to try it.

Or whatever that story is.

It's the same gift.

It's the same item.

But it is a completely different feeling.

And as humans,

that's really what forms those lasting memories.

So the part where we pair people with merchants that they're

excited about stories that they're excited about,

products that reflect their personal values is part of what gives

people that feeling of,

wow, I nailed it.

Right? And I think that also extends on to people talking

about the experience with other people,

which attracts new customers to want to come and try the

site the next time that they have a gift that they

need to produce.

So give biz listeners,

I want you to really,

really, if you didn't catch this,

go back and listen again because so often we talk about,

well what's the why behind your business?

One of the why's is why you start your business in

the first place.

But the second is why would someone purchase from you?

And I think it would benefit you to sit and give

some thought to what is the experience that a customer gets,

whether they're buying what you make for themselves or whether they're

buying it as a gift.

Is there a way to add another level of experience onto

it for all the reasons that Laura just talked about?

So just wanted to make that comment cause I think that

is a golden point,

Laura, I really appreciate it and I'm thrilled that we brought

this up and talked about this.

I want to take us back to after you did the

test, you saw that it was working and then obviously filled

any orders that came through with the test from your popup,

right? But then how did you start growing the business from

there? Well,

let me tell a story about connections.

Laura is going to share her story right after a quick

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One of my best friends broke her leg and was stuck

in bed for many weeks.

And so lots of her friends were coming through,

not only me,

we would go try to keep her company.

And at one point my friend Liz said,

gosh, you know this other friend of mine who I did

not know told me a story about a business she's trying

to put together and I think the two of you should

meet. So okay.

So the two of us met and we had in common

that we both very much like this mutual friend.

And by sharing our stories of what we were trying to

do, it really gave me the courage to move forward.

And in fact,

this person helped me,

she invested her personal time to help me with my business.

And I am in fact an investor and very much a

big supporter of her business.

And so there's a little serendipity to that,

but it really speaks to even having had this background of

building things in a big company and then being a VC,

I think having that person who was going through this same

thing, albeit a different business that we could support each other

was really important.

So really between when we did the popup shop,

when we did that test case and when we launched our

software platform online was about nine months.

We really think of that as our MVP,

our minimum viable product we got in the market by the

next holiday.

And then again,

what we were trying to figure out what that MVP was,

does what we saw in a physical environment translate to e-commerce.

So we ran that for three or four months and analyzed

it and found that yes,

it very much replicated on multiple dimensions,

exactly what we had seen in a physical environment.

And then based on that,

we then built the beginnings of what is the platform we're

still built on today.

So really I think of this as a conceptual test to

understand more of the sociology of what we were trying to

do. Then the technology test to see whether it translated to

e-commerce and then the build of the final platform.

So from the test to when we started really building the

which isn't that long.

Really. No,

I'm not a very patient person.

Well and you also did say that you didn't jump in

fast enough so that,

that's interesting too.

I know you take a lot of care.

You're saying that as we were talking about your candle in

the beginning,

that you take a lot of care in the background of

products that you provide.

So talk a little bit about your sourcing and the standards

that you have and all that for the products that are

available. This is one of the issues with scale too.

There's the,

what we were able to do in the beginning becomes harder

as we get larger.

But what is true about everything we carry is that we

really believe in it and we understand the story behind it.

So we get to know all of our merchants and that's

really important to us.

So then when a corporate customer says their brand values lie

at the intersection of sustainability and female empowerment,

we know exactly exactly who to introduce them to as a

merchant. So we take the time to really get to know

people, we understand what their values are.

And in the beginning I was able to play more of

a role in that.

And today we have a staff of two or three people

who do that.

So I've had to let go a little bit,

although that's hard because I love our merchants.

There's nothing I love more.

When somebody we were working with when they were very small

becomes a success story.

So we have a modernist aesthetic,

we want to do business with good people who we understand

and we can introduce and share and pair with our customers.

And there has to be a story behind the product and

a cause.

Something besides just the existence of the product.

There has to be some depth to it.

To the business.

Yes. If you go on our site,

you'll see there's a shop by ethos area where you can

filter, I mean everybody doesn't have the same values for some

people, they really want their products to support if they can,

helping other people or giving back to the community or maybe

they want to buy locally or female empowerment.

I wouldn't say everybody has to have the same values,

but we allow you to filter,

maybe you want to support small businesses.

So we allow you to filter it that way so that

you can then take ownership of this gift.

And I can say,

so I know you really care about sustainability,

so all of the products in here are made by whatever,

or I picked this product because they give 20% of their

profits back to water conservation.

And I think that's all part of giving the customer ownership,

particularly that if you think about the millennial generation and really

have grown up curating their personal brand.

And so this notion that they're going to buy something that

doesn't represent who they are as a gift.

I mean gifts are very personal.

It's an Emissary from media.

I think that is an antiquated notion.

I think today we want to believe that who we buy

from matters and that if we can take something we're doing

anyway, which is a commercial transaction,

and use that to make a difference in somebody's life,

that feels really good and it feels contemporary.

And if you've grown up in the last 20 years,

your expectation is that's how it should be.

Yes, and I really think for everyone who's listening here to

what you said is really powerful.

Who you buy from matters.

Because when we're out at craft shows,

let's say there's a big fear,

I think with a lot of people who listen,

Laura is,

you know,

like let my product speak for itself.

I don't want to go on Facebook live or I don't

want to be in a craft show where people can see

me. Like that's scary.

My product is beautiful.

People say they love it,

let it to speak for itself.

But when you start talking about who you buy from matters,

getting yourself out there in front and interacting with your customers

can be so powerful for the growth of your business.

I believe that is true.

I'm sympathetic though because I'm an introvert,

so I get where that's coming from.

However, I agree with you completely.

It is so powerful to make a connection and that connection

is really about the story behind that product.

Why did you make it?

How did you pick these materials?

What motivates you?

I think that is what resonates with people.

Again, it's about the story more than the thing And you

know what's so magical about that too is price becomes less

relevant. People are going to buy the soaps that you make

or the boxed gifts that you make,

even if it's more expensive because there's just so much more

to it than just the product.

That's why I asked you that question earlier.

There's so much depth then into not only the tangible pieces,

but the gift overall.

Right? It represents who you are as a person.

Right. How often are you adding products?

Are you continually on the search or do you have a

certain percentage of rollover you try to do to keep things

fresh, or how do you manage the inventory in that manner?

Yeah, so obviously there's seasonal gifting occasions that we pay a

lot of attention to holiday big one,

which will have its own product climate will launch really for

that season.

Mother's day is another one where although we sell a lot

of gifts for women,

that's a very strong part of our site.

We will typically launch new products around mother's day.

However, there's always continual changes,

modifications to the product line.

As we discover new vendors,

we see a place to put something in,

we identify a new trend and one of the categories we're

already strong in.

So we are always looking for new ideas and the amount

of turnover on the site tends to be pretty moderate except

when we're launching maybe a new whole category or around those

big holidays.

Okay. And are you going out to shows to seek new

vendors? You know,

we didn't in the beginning.

A lot of it in the beginning was word of mouth

and we would just show up places.

So we go to New York,

we go to where we would find people who were with

artisans and they would introduce us to people,

urban craft uprising.

So in the beginning,

a lot of it was word of mouth,

being in the community,

caring about people.

And when you care about people,

you make them feel good about working with you.

They tell their friends that in the beginning was what we

did. As we've gotten larger,

we do visit the shows,

we try to still find things that are unique.

So we might not source from those shows,

but it's a really good place for us to go and

see trends and certainly get creative energy even if we're not

always sourcing vendors that way.

Okay. And I'm just curious.

So as I look at your site,

first of all,

I already mentioned this before.

The site is beautiful.

The other thing I really like about it is there are

some premade gifts that you can either just take as they

are or you can add on.

I'm telling you about your own company.

Right? But I'm what I'm observing.

I appreciate it.

Well, it's what I'm observing,

but it's so easy then to customize it too.

It's so intuitive.

But I'm also thinking then about the composite of a gift.

When people add in product,

do you try and create so that all the product looks

similar so someone doesn't have something that's all let's say pastels

and then add in something that has bright red packaging,

you know something like that where it's not going to look

as visually pulled together if they add in more products.

Do you do anything about that?

So no is the big answer but let me talk about

what we do do,

right, so we have these already made gifts on the site.

At least we put together those ideas.

None of those are in inventory.

I just want to be clear about that.

We don't have a stack of those products already made in

our warehouse.

Those are ideas.

You have the individual pieces With the individual pieces and we

have an idea and a customer they can buy that idea

or they can add,

they can subtract,

they can change.

And most of the time they do.

Most of the time they make something that makes it feel

like theirs.

It reflects who they are Because it's so easy to do

Because it's easy to do.

But what we do is then now we have all this

data about how people,

other real people have changed the gift.

And so when you're modifying the gift,

you can see down below we've gotten some recommended items and

that really comes from both us saying,

boy, this looks really good together.

But also we observe that a lot of people taking this

gift and putting this other thing in.

The other thing we do is we have these gift builders

where you can create a gift from scratch using a recipe,

if you will.

So we give you a recipe for a gift for let's

say a typical bridesmaid's gift contains some item that they'll have

forever. It contains something useful for the day of,

and it contains something fun.

It usually consumable.

And so we'll put together that recipe in a set of

products that fall into each of those categories.

And you can very easily click,

click, click your way through and make your own gift.

But then again at the bottom there's just a search bar

and you can add whatever you want.

So although we help people,

we guide that through these example gifts and the recommended products

and these recipes.

In the end,

a customer can make whatever they want and sometimes these crazy

gifts, sometimes the gifts are totally crazy and I love that

because I don't need to understand it.

It makes sense for the gift giver and the gift recipient

and that's what really matters.

Right? Cause they might not even look like products that should

go together,

but they all have a story that match the relationship.

Whoever's giving and the receiver.

Exactly. Yeah.

Now let me go to the back end of that cause

you talked about how things look.

So we are making every gift from scratch.

Well we think about the people who work in our warehouse,

they're not pulling product and throwing it in a Brown shipper

and putting a shipping label on it.

These are people,

I think of them more as their sort of florists.

Right? They're like gift florists.

So they're looking at what the customer has put together and

their job is to make it look really good.

And we give those people a lot of leeway.

They're experts,

they're making these gifts all the time.

And so if they want to change boxes or they want

to add a little something,

they have the ability to do that,

to make that gift look good.

And we try to help the consumer,

but we don't limit what they put together because that's sometimes

those are the best gifts And there's a reason for it.

If they've consciously selected a specific item and added it in,

there's gotta be a reason for it.

Exactly. Okay.

So Laura,

your story sounds beautiful.

Perfect. Great experience as you were walking into knack and then

you just picked up,

figured things out as you went.

Take us to a time when things were more challenging.

Tell us a story there.

Okay, so I love the Chuck off.

Yeah, so two holidays ago,

sales were stronger than I had anticipated.

And in the middle of holiday.

We came in one morning and we were out of boxes

out of our most used box size,

just completely out and we just put our heads together and

we had some samples that were out and we collected those

back and we changed what boxes things went in and we

bought some boxes just kind of off the shelf,

the best boxes we could.

And we bought ribbons and really invested in making these new

boxes that weren't our typical ones look really good,

but we didn't do as,

we didn't spend a lot of time figuring out who to

blame for running out of boxes because you don't have time

for that in a startup.

You try not to make the same mistake in the future,

but it really is about,

okay, this is the reality,

what are we going to do now?

So we have not made that same mistake but that was

a big one because you know it seems crazy that we

wouldn't have noticed but sales were good and we were all

busy and everybody was just doing whatever they needed to do.

And all of a sudden it's like,

Oh no,

that was kind of a big mistake.

Yeah. So solution first and then maybe you figure it out

behind the scenes later to prevent it for the future,

but certainly not the blaming game.

I mean,

that doesn't take you anywhere for sure.

No, it doesn't.

So did that activity in the solution then delay some gifts

going out?

I mean,

how did you manage that through from the customer standpoint?

Or was it seamless?

It was seamless.

Well, that's a miracle unto itself.

Yeah, it was expensive.

Right. But no,

it didn't impact the customer at all.

You know,

one of the other things I want to say about that

is we do have this attitude of,

and this gets to the sort of the culture you're creating

when you're building a company,

then everybody has each other's back.

We're in a business where,

because it's gifts,

high percentage of our business will come in that fourth quarter

and things get really crazy in certain areas of the company

during the fourth quarter.

You know that holiday bubble moves through the company differently.

Yeah. Our marketing and creative department are busy with holiday in

August, September and then our merchandising department is busy even earlier

than that.

And then our fulfillment people are busy at the end of

the year.

So one of the things that happens in the fourth quarter

is we redeploy resources.

Our marketing people can be working on a production line when

we are really full out at holiday.

Our developer might be helping keep operational systems going and I

think that spirit of we have each other's back,

we all understand the value of every part of this business

and we can step in and support other departments,

really helps us get through those crises because we're used to

that. When we hire,

we say this is your job,

but understand this is what holiday is like here and at

holiday I'm on the line,

I might be making your gifts and I learned so much

by doing that.

I learned operational things.

I see firsthand what customers are putting together and that is

a cultural element that I hope we never lose,

no matter how large we get.

I remember that from my corporate world because I was in

a production facility as well.

I was on the sales marketing end leading a Salesforce,

but we had meetings with all of the department heads,

so me being sales marketing,

like accounting and production,

et cetera,

and often there were challenges between the departments because people just

didn't understand.

Like if we're selling more and something wasn't created properly,

operations didn't understand why we still got it out,

but it wasn't what the customer had asked for or expected.

Things like that.

And I think you're so wise in having,

not only are you able to cross people over and flex

the jobs when you need them in different departments,

but that understanding of the challenges that each department has,

how everything fits together as a whole is so great.

We never really talked about that because a lot of the

businesses who are listening right now may be a business of,

they start off as one but maybe five or seven people.

But understanding how everything fits together is really a topper to

explore more within your own businesses,

I think.

I think it is because when you're in charge,

particularly as a small company,

you know everybody has their area of expertise and you're running

it over a hundred percent capacity all the time.

You might not even know what questions to ask somebody in

another department to make your job easier.

For example,

we generate custom paperwork for every gift as well.

We have a custom gift message and also a name tag

that goes on the front of every gift.

So that paperwork generation along with the pick sheet,

cause again these are all made to order gifts.

There's a part of our process between when the customer places

an order and when it is on the floor being made,

which is around paperwork generation.

And that is nontrivial.

That has to be perfect.

It has to be perfect.

It's part of the whole gift experience.

So this holiday I talked about,

one of our developers was working in that office and observing

and realized that there's a solution he has since now built

that can streamline and automate that process in a way that

saves our operations people both time but also really increases the

accuracy. So we're not reprinting very often,

but if you're sitting,

if you're just trying to get that paperwork generated every day

and you might not even understand that,

Oh, there's a solution that somebody else could provide.

And so I think sometimes just seeing how other people work,

sometimes if you're upstream or downstream of that department,

you have ideas that come from a completely different point of

view that can make the whole process better.

And I think it adds to the richness of your experience

in your job too.

You know,

if someone's in fulfillment and they are,

yes, they have all the creativity of putting the package together

in the most beautiful way,

but understanding what also circles around them,

even if they're not actually doing that,

makes them feel more valuable where they fit into the whole

and also a deeper level of satisfaction,

I'd say.

Yeah, I think that's one of the beauties of a small

business because you don't have all the people you really need

and you don't have all the ex that the specialized expertise.

Sometimes you just get the group together and you try to

put your heads together and figure something out and yeah,

there's an intellectual stimulation that comes with that because you can't

just call him the expert.

You need to figure it out collectively.

Yeah. Well,

and that leads to the point that just because you're the

owner doesn't mean you know everything.

Absolutely not.

There are other people could have a better solution and let

that be except that and that's good.

Right? You don't have to be the one who knows and

has all the solutions.

You can call on people around you to also help you.

That's right.

Okay. I can't let you go without addressing one other kind

of big topic,

but we can narrow it down a little bit and that

is once you got knack up online,

then you're not in front of people with popups anymore.

How did you attract people to come in and know about

you? That's the hardest part.

Without question.

That is the hardest part that you think in this internet

age, you're going to build it and people will come.

That is absolutely not true.

You need to think through where are you going to get

your customers and particularly when you're just starting out and you

don't have a big marketing budget and you haven't hired some

big important marketing person,

perhaps you need to be creative,

so start with what you do have and really that could

be your friends,

it could be your contact network.

Really think about how you leverage the assets.

You have to build some momentum and be realistic about what

you can do in the beginning.

So that second year,

although we weren't doing a popup,

we did do a lot of events where we invited people,

organizations, friends and family as we were getting the word out

because people didn't know we existed.

So I would say that it is easy to get excited

about your product and not think about what your marketing channel

will be an absolutely.

You need to start doing that from the beginning And it

sounds like what you do to start to get visibility might

not be what you do longterm when you're smaller.

You can do other things that aren't necessarily going to scale,

but get your name out and start bringing money into the

business. And then from there you can change it as you

grow And start learning and understand the different parts of the

marketing channel play different roles.

So for example,

paid search is a great way to use a small amount

of money to test a concept.

Is this a category?

Am I describing the customer need the right way?

Am I offering the right products to fulfill that customer needs?

So you can use paid.

So you can use SEM as a way to test a

concept before you invest in maybe earned media or organic strategy.

So I think also it's understanding what role you expect everything

to play.

And not only do early stage marketing activities,

sometimes not scale,

but sometimes you do things that deliberately are not your scale

plan because you're doing them for testing reasons.

Oh, interesting.

That makes sense.

So as you continue to move forward,

what do you see as the future for NAC?

Well, I really would like for NAC to be considered as

part of a wave of companies that modernized of large sleepy

categories. So when you think about what Bonobos has done to

men's wear or what Warby Parker has done to eyeglasses,

I really think gifting is one of those categories that is

right for reinvention.

If you look at the market leaders in the gifting category,

so say people doing over a quarter of a billion dollars

in annual revenue,

not a single one of those companies was created in this

century. And so I think there is a gap in the

market for a GoTo gifting solution that really represents the modern

era. And so that is our vision and it's really built

around giving the consumer what they want in terms of operationally.

What that means is,

this is probably our last year having a single fulfillment facility

that types of orders we're getting are increasingly large.

The distribution partners who are starting to approach us.

we're going to have this challenge of how do we manage

a multi office,

multi geographic company.

Oh, that will be interesting.

That is a challenge,

but I'm guessing you're going to figure it out.

You know it's coming.

So there's that.

Well we've been talking a lot about your website.

Do you want to tell people how they can go find

you there and anything else you want to share about how

people can see you?

Yeah, so our website is it NAX shops.com

and there are multiple ways we would love for everybody who's

listening to come to the site and experiment.

Sometimes it's fun just to play with those gift builders and

make gifts and you can save them in your cart for

a future time or save them in your account profile.

But we're trying to make the process of shopping for a

gift, not a chore,

but a joy.

You know,

when you think about how people talk about gifting,

particularly at the end of the year,

but we'll say things to each other like are you done

with your shopping?

It's true.

It shouldn't feel like that.

And hopefully it actually ups.com

it doesn't feel that way.

Well I'm pretty sure that people who go on and start

looking around won't feel that way cause our biggest challenge is

going to be not spending hours and hours on the site.

That's really going to be the problem.

And if you want inspiration,

of course you can just follow us on Instagram.

Perfect. Well thank you so much Laura.

Such great information.

It's so interesting the background that you come from and then

how Nat got established and all the really,

really valuable business building insight that you gave us.

A lot of topics that we haven't talked about here before.

So for that I thank you so much for coming on

the show and thank you.

So it was a pleasure.

There are so many gems to remember from my talk with

Laura here.

Let me bullet point a few of them for you to

ponder today.

Number one,

give the customer ownership.

Is there something more you can do to give your customer

control of their purchase or perhaps in some other way in

relation to your business to who we buy from matters?

Stand for something and make sure people know about that.

It will endear people to you and your brand.

It makes them loyal and brings referrals,

which leads to the third point.

The connection is about the story behind the product.

What's your story and are you sharing it?

Stories are what become memorable and passed on leading to natural

word of mouth marketing,

customer experiences.

That was the overall theme today and we're going to build

on that next week.

You'll hear another version of how a business sets themself apart

to grow a strong brand and a loyal following.

I'll see you then.

I want to make sure you're familiar with my free Facebook

group called gift is breeze.

It's a place where we all gather and our community to

support each other that are really fun post in there.

That's my favorite of the week.

I have to say where I invite all of you to

share what you're doing,

to show pictures of your product,

to show what you're working on for the week,

to get reaction from other people and just for fun because

we all get to see the wonderful products that everybody in

the community is making.

My favorite post every single week without doubt.

Wait, what aren't you part of the group already?

If not,

make sure to jump over to Facebook and search for the

group gift biz breeze.

Don't delay.