Pricing Practicum: Ana Apple
We have spent the entire day talking about pricing strategies, busting money miss talking about what marketing has to do with value and then what what it has to do with prat with pricing and so we're going to spend this last segment making sure that one your questions are answered and two that you can see some really apple some really clear application of all of the strategy and the learning that we've been talking about this point, so we're going to be hot seating are awesome studio audience and I'm so glad I'm so excited to have these conversations with you guys and I know that you're going to bring lots of great questions and great example, so I'm gonna go ahead and have anna come on up and she's got some some questions to ask you my five yeah, but the audio guys just went nuts. It's okay, so first of all remind us what your website is, and then why don't you go ahead and talk about what kind of on your mind in terms of pricing and value right now? So my website is an apple dot com ...
the one thing they're I'm no most for infant garments and toddler used t shirts that just celebrate childhood creativity they they're uh, using really responsible materials so things meet fabric made from recycled plastic bottles they use a lot of vintage material but mainly it's just teo just like celebrate creativity and curiosity and that kind of thing um talk about my yeah so so what's on your mind in terms of pricing positioning kind of the next step of your business in terms of all of those things okay, so it's definitely so january makes five years may of this year I finally went full time in my business, which was a huge decision but I'm very happy I did I this is the hardest I've ever worked in my life but it's also the happiest and most fulfilled I've ever been that being said I have recently been presented with two amazing opportunities to girl my brand one of them is I don't know if I can actually mention names but yeah that's okay, just give us the rundown, okay? So one of them is to work with a, uh major organics retailer pretty high end they want teo carry they want a wholesale parts of my line in their stores starting in northern california where I'm based on and then if we built a really good relationship, then we'll talk about expanding beyond it's a huge step just because I haven't worked with a company like on this scale before, but I know that just just kind of touching on what you said in the last segment about to do my core values align with this I took that as thinking about this decision and especially with the next one it's, another corporation that would like tio pair partner with me and essentially work as, like a distributor or sales rep for me to get me out to the six thousand boutiques that they're a nationwide, including some eventually some major department stores, and that is the one that really like messes with my, like, money, mindset and kind of where my business is headed because I come from the like I built this from scratch this is my baby, I've raised it it's now almost five and it's, you know, kind of coming into its own, and I'm a little bit resistant, and I know I mean, I'm the one standing in my way of letting it kind of get away from me and like I said earlier, alienating the people that helped me get to this point just because I have now the opportunity to reach a ton more people on that might mean bumping up to a new price bracket and there's just a whole lot of stuff that's coming up with it, certainly. So I feel like I'm selling out is kind of a short and sweet of it, yeah, and so I'm really glad that you've brought this up because one, I think it's a dream that aa lot of people don't even realize it's possible when they start up a business like yours whether it's as a designer, as you know, a maker, someone who's actually stitching things thes air dreams that that just aren't even on the horizon often and so I think it's great that you're putting it out there that not only is this possible but it's achievable like you've got, you know you've got your step by step plan for getting into it for finishing these deals and getting into these stores, and that is really incredible, but it also highlights, you know, there's midi grit, ease of price going on here is the price sustainable at that level at that volume? Am I actually making anymore buddy? Or is it all going into distribution and production and all of that stuff on then? It also really speaks to the positioning that we've also been talking about kind of winding in and out the last two days and that kind of the back and forth between those two areas I think, is where a lot of the confusion or lack of clarity comes from ana business owners part and I think it is really helpful to always get help to get support, to get advice from an outside party when it comes to making this those kind of decisions, so I think the first thing to really consider is, where do you want your business to go? Earlier we talked about who do you want your customers to become, but we also need to think about this for our business too. So where do you see your business going what's your kind of overall vision? Where do you want to be ten, twenty years from now in an apple? Yeah, so um ultimately like if fear money time wasn't a factor. I keep saying that my big vision for my life and for an apple is to have it be a platform for then a program that takes my idea of celebrating, celebrating curiosity and joy and all these positive things and responsibility and giving back to community and then developing this mentorship program not pairs working artists with kids to teach to I'm sorry to help build confidence through creativity, and every time I talk about it that's like what motivates me and so it's kind of like if I take a step back and look at this like a problem that I'm having, I'm like, well, how many even going to begin to put the energy and the resource is towards making this vision happen even getting it off the ground if I'm behind the sewing machine and you know I'm the one doing all the e mails and you know that that is a better answer than e for you to come up that is your maybe that thea answer how do you create the time the energy the space in your life to make that vision a reality if you don't let go over the parts of this business that are taking up that space that time that energy it doesn't have to stop being your baby for you to let parts of it go like I don't live with my mom anyway you're right I live on the other side of the country my mother I'm totally independent mind still my mother's baby yeah it's so there are ways that you can let go of this business and become the ceo become the president really think of yourself in that role as opposed to the chief product designer jeans marketer vice president of sales vice president of h r all of those things you don't need to have your finger in every piece of the pie to be ableto have this still be your baby to me it sounds like yeah the vision that you have is should be deriving factor in every decision that you make so everything you do needs to be thought of as is this creating more time in my life is this creative more flexibility is this giving me the money that I need to start this program to start this foundation I must see this a nonprofit I right and so you know how are you going to see that nonprofit if not with a major contribution from anna apple the corporation right? Exactly that's way okay, so when we were kind of banding about this problem earlier I was thinking there's there's two ways that you've got to go right you either have to raise prices in in a way that allows you to support probably ah wholesale agreement that's not just times too but probably to point to where two point five right at least s o do you how do you raise retail prices in order to sustain that or how do you bring down the production cost so that you are still bringing in enough profit per piece to support your vision at that scale? All right, all right, so I think that that often comes down to again a question of values do you want to have a product at a certain price point? Is that important to you for a number of different reasons? It sounds to me like one year at a good price point and two you're really comfortable with your price point even if they're still sum's you're probably a little bit you know what? I probably should be a little bit higher. What I'd say is I would encourage you to go up to that little bit higher okay, make sure you're doing the math make sure the math includes all of the calculations that you'll need to enter into these two sales agreements or distribution agreements um re calculate your price all across your line but then you know, I also think that you need to look at the production side of this as well and I think this is a really valuable conversation tohave here with this audience because you've got ideas for how you can really sustainably ethically get this stuff produced at a a slightly cheaper level and free yourself in the staff that you have now up to really spread the there could grow the business in a different way other than just sitting at sewing machine all the time so why don't you tell me about kind of what you're thinking about in terms of production so that's I think where the biggest blocks air coming up or I should say like my biggest resistance because you know the vast majority of us are based on etsy or that's where our businesses were born razon, etc and so it's like everything's d I y and I I feel like I'm just kind of like going back and forth between like no, I have to stay true it's can made and everything's in house and I'm just going to hire more people to help me with production is going to be one big happy family but van I'm like wolf I have this opportunity to get into even half of those six out like say, I just started with a thousand stories like thumbs right now I'm in seventeen and thinking about so how that's a huge jump and so it's like I need to kind of clean up my my stigma of like well if I then outsource our production too even like a very kind and like family run and where it's been in there in the general in the family for three generations and you know they're well paid and they're happy and they're in california like I go visit these facilities you know I think it's just like that such it just seems like such a big step to me that that's how I'm just like whoa no wait I gotta wait and yeah so let me offer you some things in terms of repositioning this for yourself handmade is a super problematic word handmade sucks as a worse so I love handmade products but here's the thing everything is hand made there aren't machines out there sewing garment it's without the interaction with other people right? So whether it's handmade here or whether it's handmade in southeast asia or whether it's handmade in india everything is everything we're wearing is handmade whether I bought it from an indie boutique or whether I bought it from j c penney that's you know they're all handmade so handmade stinks as a marketing term it sucks as positioning because it's just it's not accurate it's not an accurate reflection of what makes your garment valuable um and also when you stick to that positioning of handmade you end up treating your self worse off oftentimes than the people that you could be outsourcing teo so you just said you have this opportunity to outs outsource to production facilities where people are well paid where they're happy where they're treated well they might get to bring their pets toe work or have oh my gosh have paid time off e teo no way so who are you to position your products in opposition to those kind of production facilities? What sense does that make so I mean, I am a firm believer and supporter of moving into production and facilities like that as soon as that makes sense as soon as that's part of your plan part of your vision and it sounds like you are well beyond that being a really possibility for you you have opportunities here in california there's great, I know there's great production facilities as well in colorado and in oregon so you are surrounded by opportunities to outsource this ethically and if anything tohave happier people making your work and you will be able to provide even better job for the people that are on your staff already right? Because they won't be wearing their fingers to the bone right? They'll be able to, you know, use their own skills their own strength to really give back to the brand that you have and see that take your business not just from those seventeen stores which those seventeen stores are awesome and congratulations for getting that far but forgetting for turning that seventeen stores into a thousand five thousand six thousand stores so I mean that's making everyone's lives better right and it's taking your product and putting in more people's hands and that's making their lives better as well you're putting more value into the hands of the customers those potential customers that don't even know you exist yet yeah yeah do you have more questions about this decision I just need a marinate on that yeah I think it is just kind of knowing that I've already really made the decision and it's just kind of getting out of my own man being like hey it's okay like yes there's it doesn't have to be icky like all of the integrity that has gotten me to where I am now on all the values dot I have at my very core can continue and like just because I am outsourcing to help build my business and reach more people in a very positive way it doesn't I mean that I've abandoned those values and I think that that's something that I just really had teo acknowledge for myself yeah I agree I actually think that your values are driving you further further in the direction of this decision and not the opposite way around and if you continue to keep reminding yourself of those values and of the conversation that you're that that you're having around those values both with yourself and within your company already and with your customers that's that's going to really help think we've got some internet but have a great comment about we asked because jock the goldsmith says most of us craft people use others to do some of the process while outsourcing to asia sucks I sometimes have to resort to that I use a caster in l a a setter and maui a goldsmith in bali to make my design awesome so you know yeah yeah I think there's I think getting past the stigma of growing our businesses in ways that make sense is super imp porton tte like I said earlier how many of us would work for minimum wage for someone else how many of us would work for free for someone else and if the way that you're running your business right now involves you working up all night long and working for less than minimum wage you're not doing yourself any favors by growing your business by not growing your business sustainably you want in fact are not growing your business by making less than minimum wage and working all night long you're a slave you're a slave to yourself on dh that's no that's not how you that's not why you started your business that's not the kind of values that you want to be putting out into the world on dh yeah and so I just so when I give back if I am not giving too many meltdown, if I'm not taking care of number one exactly you by doing by making this decision by moving in this direction by making these changes, you're making an investment in that vision that you have that foundation, that mentoring program, you are making an investment in that right now by being able to make this decision and make the changes that you're making, and if you don't do that, you're just putting that dream off longer and longer into the future. What one is that I want to see your dreams happen tomorrow there were there any other questions or comments for anil? Nothing really just trying teo tamara h says outsourcing does not have to be a dirty word amen. Amen. I'm so glad that we've got so many people on the same page on that, I think it's, super important and that's how we're really helping to remake this new economy if everyone is just making less than minimum wage, staying up all night, producing the work that they're doing, we're not doing something to remake the economy by growing your business is by making sure that by outsourcing sustainably, ethically giving people jobs, you really are making a huge impact on the way the economy is growing and changing for the better right now. And and I just would love to summarize again for people who are still asking in here so if I can't or I shouldn't use the word handcrafted again how do I go about finding what word did this for me? Yeah, so it's not that handmade or handcrafted is a bad word in terms of a description but it's not a value statement all right? Generally people you know they feel better about buying something because it's handmade are handcrafted they appreciate it that it's made by you or made by your friend or made by you know, someone that you pay a good wage but that's not a value statement. So you have to figure out what the value statement is for you and so we've we've gone through all those different tools today yesterday thinking about the changes that are customers make because of our products, thinking about what it symbolizes to them, what it means to them, you know you've kept using the word humor and curiosity and fun and creativity and those are words that you can kind of start to form into value statements and will be things that are much more valuable to your customers than handmade are handcrafted, so it's not I don't have a specific problem with you saying that something is hand crafted we want to be honest about where it came from and it's certainly a feature but it's, not a benefit. We haven't talked really about features versus benefits today, but, you know, features or things that your products kind of have as part of them, it helps make them work. It helps make them what they are. But a benefit is what really, what the product really means. Your customer, what it does for them, what it allows them to do more easily, cheaply, conveniently, with more fun, with more creativity on dh, so we want to be focusing on benefits. Handmade isn't a benefit, but so you want to figure out what yours is. Thanks, ana. Thank you.