🥗 1800 stores. No Sales. WTF?!

Hey there,

Welcome back for another bite to chew on.

We hope you’re having an amazing weekend and are ready to crush a productive week ahead.

We’re currently on our way to San Diego for the Sendlane Commerce Roundtable, where we hope to see as many familiar faces as possible.

In this week’s newsletter - we’re talking about retail (again, again)

Why?

A) Because last week’s newsletter was a big success, and many of you requested more content about this

B) Because we just launched in 4200 Walmart stores and would love to share some learnings with you (in case you’re new here)

Before we start, we also have a few things we want to share with you

1. Last week, we threw two very succesful dinners in Austin and New York with over 100 founders in total. If you want to join the list and get invited to the next one - go here

2. We want to improve this newsletter, and therefore we need your help! Reply to this email with any feedback you have to help make this newsletter better

Without further ado, let’s jump straight into it

Finding a consolidator is a lot more efficient than using your standard 3PL

Initially, when we entered Walmart, we were thinking:

“Let’s just use the same 3PL as we’re using for our DTC channel.”

Instead of sending to multiple locations, we’ll just send a lot to one location (the Walmart warehouse)

Sounds pretty logical…

But after talking to a ton of people who are way smarter than we are on everything retail, we quickly discovered that we could unlock huge efficiencies by using a Walmart Consolidator.

Now, what’s a Walmart Consolidator

A Walmart consolidator is basically a 3PL that ships your batch together with 40-50 other brands to the Walmart Warehouse at the same time.

In this way, everybody saves a ton on shipping costs.

This also sounds logical when looking back in the rear mirror, but when you’re midst of onboarding and launching - things like this don’t always cross your mind.

1800 stores, no sales. WTF ?!?!

“Yo, guys. I just checked the stats. There are 1800 stores where two of our SKUs have gotten literally 0 scans.”

When our VP of Sales came up to us and told us this, we all started sweating and thinking, “How is that possible ?!?!”

Every other store is moving units.

What’s up with these 1800 stores ?!?!

If you’re already in retail, you probably started to laugh because you went through the same thing.

If you’re not yet in retail, let us save you from a shocker.

First and foremost,

When Walmart says you’re going to launch in X amount of stores at Y date,

It means…

You’ll launch on the shelves of some stores, and you’ll be waiting in the warehouse of others for a solid 3-5 weeks.

But the problem is:

We don’t know who has us on the shelves yet and who doesn’t.

Sure - we can make the assumption based on the number of scans and units sold.

… But what if we are indeed on the shelves of all stores - but the product is just not moving there

So, what we’re doing is:

A) Sending people from our community and network out to see if our product is on the shelves of the stores with 0 scans.

If it is, we have a huge problem.

If it’s not, we need to push our buyer at Walmart to get them on the shelves.

Now, of course, we can’t send people out to all 1800 stores.

But if we send people to the 100 biggest and they all come back with the same answer - then we have a pretty good indication of what’s going on

B) We’re taking forecasting with a grain of salt but still extremely paranoid and staying on top of the data.

The reason for this should be pretty self-explanatory.

C) We’re waiting a little bit with going heavy on the paid ads end.

Imagine if you live close to one of those 1800 stores, and you go down to check for an Obvi product, and it’s not there.

First of all, it’s not a good experience for the consumer. And secondly, it’ll inevitably decrease the effectiveness of our marketing.

Growing in-store sales

Now, luckily, we’re also in 2400 stores where our products are actually on the shelves AND making money.

So, the natural question we started to ask ourselves is: “How do we sell more?”

We’re coming from a world where we can tell Ash to dial up the budget, and then a few hours later, we’re moving more products.

Buuuut, that’s not quite how it works in the retail world.

With the past retailers we’ve worked with, our strategy was always to do in-store demos.

They worked predictably great every time and helped us grow a lot.

But try to do demos in 4200 stores…

Or even 420 stores…

It’s tough. You need a ton of manpower and capital to fuel that kind of initiative…

And if you just launched in Walmart - chances are you need to carefully watch out for both your usage of manpower and capital.

Anyway, so what do we do instead?

1) Incentivizing people to shop in the Walmart stores

If your customers are used to buying from you online, and you suddenly want them to change that - you need to give them a reason.

For us, that reason (incentive) was a $50 Obvi Gift Card + a Giveaway where they could win a full reimbursement of their order.

Besides that, we also offered 3x more points to use on our website if they bought from a retail store and uploaded the invoice.

2) Retail displays

The two most common ways you promote your product in retail is 4-ways and side-kicks (see image below)

Now, this is the common approach.

… which we’ll definitely also use in the beginning.

But the hard part is figuring out how to take this common approach, twist it, and create a more unique/creative approach to display our products on the shelves.

We haven’t figured this out… but if you have good ideas, shoot us a DM.

3) Walmart Connect, Search and Display Ads

One of the things we didn’t know is that Walmart.com is essentially just like Amazon.com, where everybody can sell products from their individual store.

… and Likewise, you can also advertise on Walmart.com with Search and Display Ads.

Now, we have no idea how to do this.

Sure - we’ve done Search and Display Ads through Google and Amazon…

But, sometimes, you also need to recognize when you don’t know anything about something.

So we went out and hired an agency that could help us A) Get started with advertising on Walmart.com through Walmart Connect.

…and B) Teach us how to run the ads best here, so we don’t have to make all the mistakes ourselves

4) Run Meta Ads to the biggest retail locations

I think this is pretty self explanatory too…

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If you’re looking for a place to upgrade your product photography, soona is the place.

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Thanks for reading along

As always, thanks for reading along!

We appreciate you and look forward to serving you again next week!

All the best

Ron & Ash