From a dorm room at USC, Ryan Emmons and Matt Meyer founded Waiakea Springs.  They are set to turn the rest of the bottled water world upside down with their naturally alkaline subscription based brand of water.  Join me as we dive into the fiercely competitive nuances of this business with Sophia Lotter, Marketing Director for Waiakea Springs.

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Sophia: It’s a triple-bottom-line company, so it’s putting planet and people over profits.

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JD: What are the actual tactical things that you’re doing to attract people?

Announcer: Now your host, JD Crouse.

JD: Hello, and welcome back to eCommerce in the Trenches. I’m JD Crouse. Today, I’m super excited to have a company and an individual that represents a company that reminds me of somewhere warm and tropical. It has been cold here in Texas the last week, and I have dreams of Hawaii, so without further ado, I would like to welcome Sophia Lotter from Waiakea Springs. Welcome to eCommerce in the Trenches.

Sophia: Thanks, JD. Thanks for having me here. I’m super stoked.

JD: Awesome. Let’s jump right into this thing, okay?

Sophia: Let’s do it.

JD: All right. Waiakea Springs, tell me about the history. What’s the story behind how it came to be a company?

Sophia: Sure, yeah. It’s actually a really interesting story. It was actually started by two young guys in their college dorm room at USC, Ryan Emmons, our CEO and co-founder, with our other co-founder, Matt Meyer. They were in a entrepreneurship class at USC, and they actually did the feasibility analysis for Waiakea when they were at school, but the whole idea originated from Ryan when he was visiting his family in Hawaii on the Big Island. He realized that his family actually had access to this amazing water source, a private well on their property. I guess he just kind of got started thinking about the importance of water and water quality.
He’d also been doing dome volunteer work for a nonprofit called Pump Aid that we now partner with, and just the importance of access to clean water, not just in the States, but in Africa, and that’s where Pump Aid does most of their work. Kind of like bringing straws together, they came up with this concept for Waiakea, a bottled water that’s not just for profit. It’s a triple-bottom-line company, so it’s putting planet and people over profits, so Waiakea’s not only a healthy water, but it’s also sustainable and ethical.

JD: Nice. The triple bottom line, dive into that just a little bit for those who may not know.

Sophia: Yeah, sure. Triple bottom line, that’s the three pillars of Waiakea. It’s a healthy water. It’s naturally alkaline, so it has a pH of about 7.6 to 8.2, and that’s thanks to all of those natural minerals and electrolytes that are infused into the water through its filtration process through volcanic rock. That’s the healthy aspect of Waiakea. It’s sustainable thanks to the plastic that we use. It’s rPET, so the bottles have actually had a previous life before they’re made into Waiakea bottles. We use low-emission shipping. We’re involved in a lot of carbon offset programs, so the company, as a whole, is actually certified carbon neutral, and Waiakea was the first premium alkaline water to be so. That was a pretty big thing back when they started the company in 2012.

JD: Very cool.

Sophia: Yeah, and then the last thing is the ethical part. Waiakea donates a week’s supply of clean water to those in need, particularly in Malawi, Africa, where they don’t have access to clean water.

JD: Y’all donate a week’s supply of water?

Sophia: Yeah.

JD: What does that look like?

Sophia: Right, so it kind of sounds like, oh, we’re shipping a bunch of bottles of Waiakea all the way over to Malawi, Africa. That’s not the case. We’re actually donating funds to Pump Aid, and they are enabling local communities to build on these UN-awarded Elephant Pumps. Basically, they’re covered wells, and the local communities are taught how to build the pumps and to manage the pumps. When they break, they can fix them. That’s giving them access to clean, protected waters. Otherwise, their wells, their local wells that they have, they stand open. There’s no covering. They get contaminated, and then there’s water-borne diseases, which is actually a number-one killer in Africa above AIDS, which I thought was really interesting.

JD: It’s super crazy, right?

Sophia: Yeah.

JD: I mean wells are expensive, out of their realm of possibility for most of the people in Africa, and yet you can do sand filters, I think, is one option, for maybe $300 US. You pour dirty, nasty water in the top, and then it actually filters it. You can do these wells through great organizations. I’m not familiar with Pump Aid, but a couple of different churches that I’ve been a part of have supported water efforts in Africa. It’s amazing how much disease is just cleaned up when they get good, clean water into their bodies.

Sophia: Exactly. It’s so important.

JD: Yeah, very cool. It’s interesting to me. I don’t want to spend, maybe, too much time on this, but most of us get into business to create some type of freedom, freedom from the man, freedom from having to take orders from somebody else, and then also financial freedom is an aspect of becoming an entrepreneur, and the triple-bottom-line company, nowhere in any one of those three elements is profit.

Sophia: Right, yeah. That’s why Ryan, he always says, “People and planet over profit.” But ultimately, at the end of the day, in order to pay its employees, Waiakea has to be profitable. We have to make money, so that’s also a consideration.

JD: Nice. Yeah, for sure.

Sophia: Yeah.

JD: You wouldn’t be on the phone talking to me today if-

Sophia: Exactly.

JD: Love you, Ryan-

Sophia: Love you, Ryan.

JD: … but not happening today. Well, great. What a wonderful story. Founded in 2012. Is that correct?

Sophia: That’s right.

JD: Yeah, so here we are, start of 2018, six years later or five and a half. I don’t know when a month was. Tell me a little bit about how you got started with Waiakea, your background, and what you do day to day.

Sophia: Yeah, sure. That’s funny that you brought up the concept of freedom because, initially, when I joined Waiakea, I joined as an intern. I was hell-bent. I wasn’t going to work for a company. I was going to work for myself. I wanted to start a nonprofit in South Africa. My parents are South African, so there’s a connection there.

JD: Nice.

Sophia: I was actually meant to go do my MBA in Cape Town, and I was just looking for a three-month internship, and I met Ryan, and they brought me on board temporarily, but then I just really fell in love with the company and the concept. It’s an amazing story and an amazing lifestyle brand to get behind and market. After my three months were up, they offered me a full-time position, and I thought, “You know, maybe real-life experience … This is a better opportunity than going and sitting at a desk in a classroom.”
Yeah, so one thing sort of led to the next and, eventually, I became their marketing director. I’ve been there for three and a half years now, and I’ve just learnt so much, and I’m endlessly grateful for this opportunity because working … Waiakea was very much a startup when I joined. It was me and, I think, it was four other guys all under the age of 30, so I was the sole female in the office holding it down.

JD: Oh, man.

Sophia: Yeah.

JD: You’ve got to be tough. Do you have brothers at home?

Sophia: I have all brothers, yeah.

JD: Okay, so you were like no big deal to you, right?

Sophia: That’s where I thrive.

JD: Bring it on, boys.

Sophia: Yeah, exactly. Yeah, just super grateful to be able to see Waiakea come from where it was when I joined with it, I think 2014, to where it is now starting 2018. It’s just very exciting.

JD: Very good. That’s interesting. I’m a sales and marketing guy. I love marketing. The thing that rings true no matter what is that the power of the story, a compelling story can really capture hearts. I mean you can build such a loyal, dedicated following if you have a compelling story and then you remain true to that, right?

Sophia: Yes, 100%.

JD: Yeah. From employees, partners, obviously customers, and then turn those customers, and employees, and partners into evangelists. It sounds like you guys have a fantastic culture there.

Sophia: Yeah, yeah, we do. We try and stay true to that as an office, as a workplace, as well as the forefront of the brand, how we market ourselves. We do yoga at the office. It’s definitely a young culture, a young vibe. Yeah, it’s good.

JD: Good. Let’s jump into the eCommerce side of things. About what percent of total revenue comes from your eCommerce channel?

Sophia: Currently, about 10% of our total revenue comes from eCommerce.

JD: Are you looking to grow that or maintain that going forward?

Sophia: We’re looking to grow, obviously. It’s our most profitable channel, so the goal is to be at about 15% by the end of 2018. Whole Foods’ purchase of Amazon is just an indication that grocery is going more and more online, and we want to be at the forefront of that.

JD: Your core business on the eCommerce side is subscription-based, correct?

Sophia: Yes. 70% of our total eCommerce sales are subscriptions.

JD: Okay. Walk me through how that works, what the options are, for those who may not know, who haven’t been to the site yet. I know there’s going to be a bunch of people hitting there. What are the options on the subscription side and on the one-off purchase side? Then let’s dive into the good, bad, and the ugly of the subscription business, if we could.

Sophia: Sure, totally. Yeah, so customers, they have the option of buying a one-off, one-time order, and they have a couple of choices there, what case sizes they want, what bottle sizes. Then, if they want to do a subscription, we incentivize that with a discount. Our subscriptions are actually paid per month as opposed to paid up front. I can get into that later, but basically, we were sort of forced to do it that way just because of the intricacies of setting a paid-up-front subscription model with our ERP system.
Yeah, so anyway, so there’s different tiers if a customer commits to an annual subscription, so they’re going to be signed up for 12 months, they get a 20% discount. Then it sort of just tapers down from there, so then we have a six-month, a three-month, and then a month-to-month, and then the discounts decrease, so if they’re doing a six-month subscription, they’re only getting 15% off. If they’re doing a three-month or a month-to-month, they’re getting 10% off.

JD: Okay. Where do you see the bulk of your customers that are on the subscription plan? Where do they land? Are they on month-to-month?

Sophia: Yeah. Actually, I was surprised by this. A bulk of our subscriptions are actually annual, so that’s great for us. Customers are committing to being with us for a year, so we can see all of that projected revenue for future. Then, probably tying with the annual is, or just below it, is the month-to-month.

JD: Okay, interesting.

Sophia: Yeah, it is.

JD: On the annual plan, do they pay up front for that one time and they get the 20% off?

Sophia: No. It’s not paid up front. They’re just paying month-to-month. This part gets a little confusing, but we tried our best on the website to make it very obvious, visually, but so if they’re signing up for an annual subscription, they’re going to get charged every time an order is shipped. They can choose to increase their frequency, so instead of getting one case every four weeks, they can get one case every two weeks, or three weeks, or one week, so you’re not limiting yourself to just one order a month. You can have four orders for 12 months.

JD: I’m on the page right now, and it’s pretty self-explanatory. It is tricky. We’ve done some subscription at Boulder Band, which is our eCommerce company. When you start pulling back the layers of the onion, and you start doing the old [iffed 00:14:35] scenarios, if this then that, it can create quite a ball full of yarn. When you do this on the front end, it creates this problem on fulfillment and how are you tracking everything and, at the end of the day, are you shipping something that you got paid for? Are you charging people that opted out? I mean it’s just-

Sophia: Right.

JD: You’re running on Shopify, correct?

Sophia: That’s correct, yeah.

JD: Are you using Shopify Payments? Are you on Plus? Talk to me about your stack a little bit.

Sophia: Sure. We’re on Shopify Business, so we’re not on Plus. We ran some numbers and realized that we weren’t at a point where it made sense to be on Plus. Then we use Authorize.net as our payment gateway, and then, through them, the use iPayments. It’s kind of a mess. We’re basically using Shopify, Authorize, and iPayments. We had a broker with Authorize, and they were able to get us or best rates.

JD: Nice. Very cool.

Sophia: Yeah.

JD: Is the exit pop you’re using, is that Wheelio?

Sophia: That’s Wheelio, yeah.

JD: Yeah. Are you happy with it?

Sophia: Yes, yes. Actually, we brought on a, I guess, “eCommerce advisor” at the end of 2017, Brian. He’s been amazing, and he’s basically just made a few suggestions to the site, little tweaks that we’ve done, and one of his suggestions was Wheelio as our pop-up. Before, we were using … Oh, I’m blanking on the name right now, but it was just your generic pop-up. It wasn’t the gamified one like Wheelio is. We’ve seen Wheelio’s just been a total game-changer.

JD: That’s awesome. It’s a simple concept, right? I think it’s brilliant in its simplicity.

Sophia: Yeah, exactly. It’s super simple, and people seem to respond really well to it.

JD: Nice. Let’s talk about the product just a little bit, and then I want to go back into the business side of things. Obviously, the company has a fantastic culture. You’re people-before-profits focused. The product, I mean there’s a lot of water on the market, right?

Sophia: Yeah.

JD: How do you guys differentiate in the marketplace?

Sophia: Right. Yeah, it’s an insanely competitive industry, and a lot of the other competitors in this industry have been around for a very long time, and they have huge marketing budgets. We’re lean and mean, man. How do we differentiate? I would say just the story of Waiakea differentiates itself. We’re the only certified carbon-neutral company, and customers are demanding more and more sustainable green products, so I think that’s a huge selling point for Waiakea. We’re also in the process, we just licensed new technology. It’s going to be an additive to the plastic, and we’re hoping to launch this about the end of the year, end of 2018, that makes the bottles biodegradable or … Sorry, I have to say degradable in aerobic and anaerobic environments. I think that’s going to be a huge game-changer.
The water itself is naturally alkaline, like I mentioned previously. A lot of these other alkaline, high pH, you can get pH 10.2 or 9.5, those are all synthetically created in a lab, and so they’re actually, ultimately, not stable pHs, so they decrease over time. The longer they stay on the shelf, they’re actually … Who knows that the pH is by the time you’re drinking the water?

JD: Right. Well, along those lines, if I could just interject.

Sophia: Yeah, please.

JD: I went to my chiropractor, and he’s got this pamphlet. It’s an advertorial. It’s not a pamphlet. It looks like a newspaper rag, and it talks about the benefits of high-alkaline water and how cancer thrives or grows, I guess, in an acidic environment and all the reasons. I’ve heard about it, and I have read about it over the last few years. My mother, a year ago, passed away of cancer, and then my uncle, who was like a big brother, I was very, very close to him, he just passed away this year back in September.

Sophia: I’m sorry to hear that.

JD: Yeah, and so, obviously, any time I read something that talks about creating an environment where cancer won’t grow, it piques my interest. He has this filtration system. I don’t know if it does RO, reverse osmosis, and charcoal filters. I don’t know what all it does, but same thing. The pH doesn’t last. If you put it in a bottle, I don’t know why. Can you explain this to me? If it’s not naturally occurring, what does the filtration system do to alter the alkaline level or the pH levels in the water?

Sophia: Right. Those ionizers, and I can’t speak broadly because there’s just so many on the market, and they all do different thing and have different technologies, but a lot of them, and probably the older versions, basically, they’re just splitting hydrogen atoms to create a high pH, so they’re not actually adding any minerals or electrolytes. That’s why we call it synthetic. I think probably what happens, since that’s not a stable structure, it just sort of reforms, and the pH goes down. Really, pH is a measurement. Alkaline is a measurement of how many minerals and electrolytes are in your water, and those are the real health benefits.
There’s really not a lot of research out there that shows that we can change our internal pH through drinking high pH water. This is something that more research needs to be done on, for sure. I don’t want to speak out of turn, but based on my research, and I’ve done quite a bit, it’s just there’s not enough evidence to show that you can actually change your internal pH, and that’s why the real … what I can say is the real health benefits of alkaline water are those minerals and electrolytes you’re going to get in naturally alkaline waters.

JD: Nice. Very cool. That’s a key differentiator.

Sophia: Yes, yes.

JD: The degradable bottles will be huge. What I love about it is even though the product, the water, sounds amazing, I’m going to have to get some.

Sophia: Yeah, we’ll send you a case.

JD: Thank you. That’s awesome.

Sophia: Yeah.

JD: What you’re doing is you’re leading with the core culture of the company and going to be leading with this degradable aspect of this additive in the plastic. It’s taking what is, to a lot of people, something that is a commodity, even though it’s a necessity to life, and it’s actually surrounding it with value and positioning and story which, obviously, all of that, like we said at the top of the show, is going to create community and create evangelists out of the brand.

Sophia: Right, yeah. Ultimately, it’s a lifestyle brand. I think the vision for the company is not just to be bottled water, but to be a lifestyle brand.

JD: Nice. What does Waiakea mean?

Sophia: Waiakea means broad waters.

JD: Nice.

Sophia: W-A-I actually is water in Hawaiian.

JD: Very cool. Let’s get back into the business. Why subscription base? Obviously, we all know, on the money side, that any time you can create a recurring revenue stream, that’s smart. You pay to acquire a customer one time, and you get paid from them again and again and again. What other color, like color commentating, what could you add to that geneal statement of why a subscription base?

Sophia: I mean I think you nailed it, JD, by saying that. That’s the biggest reason, particularly when it’s a consumable. Well, obviously, if it’s a subscription it’s going to be consumable, but people are going to forget to order. They’re going to run out. They’re going to, maybe, go purchase water somewhere else because they’ve run out and they can’t wait for you to deliver it.
Waiakea, we started off not having an amazing distribution across the states, so eCommerce was our way to reach states and cities where they couldn’t buy it in the store. Since we launched subscriptions, it’s changed everything for us. We did really well that we keep doubling our sales every year on eCommerce, and I truly believe that’s thanks to our subscriptions, but I would also … I could talk about the dark, the bad, and the ugly of subscriptions.

JD: Yeah, do. Please do because it’s a pain the butt. I mean it’s like-

Sophia: It’s a pain in the butt, yeah.

JD: Yeah, go ahead. What’s the bad and the ugly side of it?

Sophia: Yeah. Well, something that we’re trying to tackle right now is when you’re charging monthly, customers aren’t paying up front for a subscription, you run into the issue of cards declining or billing information changing. You’re not sending out product, per se, but you’re basically sitting on this customer who’s not reading their emails about the fact that their card’s been declined and their subscription isn’t going to be sent out. You’re potentially losing a customer there and losing revenue because, a lot of people, they don’t look at their emails.
We’ve tried texting people, reminding them to update their card and sending them a link to their account. That works maybe 30% of the time. Oftentimes, you’re just losing a customer. They fall off the deep end. We need to find a better way to really manage that and make sure that people are responding to our texts or seeing our emails. Yeah, so that’s been a challenge for sure. It’s frustrating because you’re just seeing that potential revenue just sitting on the table, and you can’t do anything about it.

JD: Right, right.

Sophia: Yeah. Customer service was a huge hurdle in the past six months or so. We didn’t really have anything, any good foundation for that set up because we started with a few orders here and there, and we slowly grew. One of our employees who’s in operations, he was also managing customer service. Then he left the company, and so then we had to replace him, and then we suddenly realized, “Oh, my gosh. We need an SOP. We need a protocol in place,” and so we recently got onto Zendesk, and that has been awesome.

JD: Very cool.

Sophia: Yeah. Creating a help center so customers can self-service saves us time. Yeah, customer service, cards declined, people opting out, wanting to cancel before subscriptions are over. We actually charge a fee now because we’re giving discounts based on good faith that they’re going to see the subscription through, and that’s how we’re able to afford the discount.

JD: That’s right.

Sophia: If a 12-month subscription is canceling after three months, we’ve lost money, so having to mitigate that risk, that’s another big challenge.

JD: Do you have any data as far as customer support needs with a subscription, with the subscription side? Let’s just say that, well, you’re 70/30, so 70% of your eCommerce business, the eCommerce channel, is subscriptions, and 30% is one-time purchase. Do you have any data internally about the customer service load that your company has on the two different groups?

Sophia: Yeah. I can’t say definitively, but I would say that a huge majority is coming from subscriptions because they want to change the delivery date, or they’re going out of town and they can’t receive the water, or the case was stolen off the front porch and they need a replacement. I mean the list goes on. It’s a full-time job.

JD: Yeah. I don’t know how you feel about it, but Amazon hasn’t made our jobs as a stand-alone small brand any easier. Customers would argue, consumers would argue, “Well, suck it up,” you know?

Sophia: Yes.

JD: We’ve sold on Amazon, and Amazon and Jeff Bezos thinks … He’s way smarter than me, obviously, because he’s built a huge company and everything, but they think the customer’s always right, and you make it easy for the customer to send things back. Well, my argument is that the customer doesn’t always want to send the stuff back. They just want to be happy. Maybe they have a question about the product. Maybe they need a different size. Maybe they do need a little bit of hand holding.
Oh, my goodness. Over the last four years of us being in eCommerce, we have actually seen an increase in unrealistic expectations from customers. It’s a little bit hard to keep them happy. Of course, the Pareto Principle applies that if you focus on just keeping the top 20% of your customers happy, they’re going to generate 80% or more of your revenue, but when you’re a small brand, you want to keep everybody happy because, boy, can they complain if you don’t.

Sophia: Yeah, yeah. We’ve definitely seen that. I mean we’re so grateful for all of our customers who’ve supported Waiakea all of these years, but it’s definitely been difficult. We’ve gotten emails like, “Hey, my order was placed yesterday. Why haven’t I gotten it yet?” It’s like, “Oh, my gosh. We’re not Amazon.”

JD: We don’t have drones in the air yet, right? Oh, that’s cool. If it was easy, everybody would do it, right?

Sophia: Yeah, yeah.

JD: I mean if eCommerce was easy, everybody would do it.

Sophia: Yeah, for sure.

JD: Very cool. Let’s talk about acquisition. Let’s talk about top end of the funnel. How do you attract people to the brand? Are you running paid advertising? If so, where? I see that you have a rewards referral program. I’d like to learn a little bit about that. What are you using to attract people to the brand?

Sophia: We’re doing quite a bit. I would say a majority of our budget goes towards Facebook, so Facebook ads. We have two guys running those, so I no longer actually … I’m no longer making those ads because it’s become quite technical. I did two years ago, but just in the past two years, it’s insane.

JD: Are they internal or external? Are they agency?

Sophia: They’re freelancers.

JD: Nice.

Sophia: Yeah. Amazing group of two guys. They’re really good at what they do. Yeah, we’ve seen some good success with that basically driving blog content and cool visuals in our Facebook ads driving people to the site. We’ve also seen great success with AdWords.

JD: Nice.

Sophia: I also, more recently, outsourced that out, and we actually have our lowest cost per acquisition on AdWords, so that channel’s been awesome.

JD: Are you able to open it up? Are you ROI-positive on the first acquisition?

Sophia: Yes, yes. Scaling it is another thing, though.

JD: That’s what we’ve always found on AdWords. It seems like you can just scale easier. I don’t know that it’s easier, but Facebook will, to a point, allow you, the more that you spend, you can hold those-

Sophia: Those numbers?

JD: Yeah, those numbers together. Is that what you have found as well?

Sophia: Well, that’s a interesting question. Facebook has been a challenge for scaling. As soon as we go above a certain spend, we notice our cost per acquisition just goes through the roof, so we’ve actually really struggled with scaling. We even created a new Facebook Ad account to see if Facebook was dinging us for some reason. They’re whole formula is fascinating to me. I don’t know how they operate, but it’s a little bizarre. We were actually told, “Hey, try doing this, and see if you have better success.”

JD: How long have you done that? How long is your-

Sophia: Just a month now. We actually saw that our ads performed worse on the new ad account, so that was a good indication.

JD: It’s so funny. It’s so funny that you bring that up because I was just thinking about that on my side. We’ve spent over $2 million on Facebook.

Sophia: Wow.

JD: Facebook has been a challenge for us. When we started, we could get a customer for $7, and our average cart was, at that time, about $26. It was actually about $29.

Sophia: Nice.

JD: Yeah. That was the heyday, right?

Sophia: Right.

JD: I mean that was crazy times. That was wonderful. As of late, we’re ROI-negative on the first customer on the first purchase, and so just trying to outsmart Facebook, right? I was thinking the same thing. I’m going to open up a new ad account and just see if I can get our acquisition costs back down there again.

Sophia: Give it a try. See what happens. It’s worth it.

JD: Now you’re like, “Oh, it didn’t really help. It was actually worse.” I was like, “Oh.”

Sophia: I’ve heard stories that it’s really … It’s been night and day for people.

JD: To the positive.

Sophia: To the positive, so it’s worth a shot. I mean we might even try it again.

JD: Yeah. Oh, interesting. Okay, so the majority of your ad budget goes, still, to paid Facebook ads. Google AdWords works good. What about other platforms?

Sophia: To Facebook and then AdWords. We do affiliate marketing. We just launched that in Q4 of last year. That’s also really interesting to me. We were actually approached by an agency, and they wanted to charge us gobs of money to manage our affiliate marketing. I looked at it, and I said, “You know, before we dive in, let’s give it a try ourselves,” so I signed up with Refersion is the name of the platform, and it was super simple, super easy to set up. It just took a couple months of letting it run, and now we’re starting to see a good amount of sales coming through there. My only concern is management of the quality of those affiliates ads and where they’re placing them. That part is scary.

JD: Right.

Sophia: Yeah.

JD: I mean I’m sure you’re not giving an 80% commission, so-

Sophia: No, no. It’s super minimal.

JD: Yeah. Is it in perpetuity on the subscription side or is it for six months or a year? How did you handle the payouts?

Sophia: Yeah. No, so they’re getting paid out for every transaction. It actually incentivized them to push the 12-month subscription, which is great for us because the percentage we’re giving them on the sale is super low, we can afford it, and then, yeah, we’re incentivizing them to drive more sales.

JD: On the referral side, the loyalty side, do you … obviously, that’s a different platform. Are you willing to share what you guys are using to power that?

Sophia: Yeah. The rewards program/referral program, they just rebranded. I think they’re called Smile.io.

JD: Okay. I’ve heard lots of good things about them in the Shopify Plus.

Sophia: Yeah, yeah, yeah. I think they were Sweet Tooth before. When we joined with them, they were Sweet Tooth, yeah. We’ve seen some success with that. We’ve seen better successes with other things that we’re doing, but we have that there for retention purposes, rewarding customers for every purchase that they make. Then, it also helps with attracting because we have the referral program. If they refer two friends who purchase, they get a free case of Waiakea.

JD: In your email follow-up post-purchase sequences, are you reminding … There’s so many things that we can do, right?

Sophia: Right.

JD: We can ask them to refer. We can ask for a review. Can you talk a little bit about your post-purchase follow-up sequences and what you’re asking people to do?

Sophia: Yeah. We use HubSpot for all of our email workflow. That’s actually part of our acquisition strategy. Then, once they convert, we’re really pushing the referral program, “Refer two friends, get a free case,” the rewards program. We actually also use targeted email receipts with Unific, and we really push the referral program through that as well.

JD: Nice.

Sophia: We do it in our retargeting ads on Facebook too.

JD: Nice. That’s interesting. How long have you been promoting the referral-

Sophia: Referral program? We launched in the … I believe it was in the summer of last year. Yeah, so it’s been a while. It’s been a good six months. It kind of took us some time to build it out because we had to build a page on our site. There’s customer service involved on that end as well, so people saying like, “How do I redeem my code, and how do you apply that code to a reoccurring subscription?” Then you have to build out this whole user experience in a customer account so they can actually self-service and navigate the whole rewards program and applying those discounts to future subscriptions and so on. It was a lot, but now it’s fully functional, and really hoping to ramp it up and push it.

JD: Talk to me about conversion, what you’re doing on-site. Obviously, you’re pushing people to the subscriptions, and there’s tiered discounts. You have the exit pop, which is the Wheelio app, which is offering, I’m assuming, another discount. I didn’t actually see the offer on that. What are you pushing on the Wheelio opt-in?

Sophia: Sure. Wheelio is, ultimately, a 10% discount. It’s gamified. They don’t know what discount they’re going to get, so they click, “Spin the wheel,” and then they’re given a 10% discount. That discount would only apply to the first order on a subscription, not every subsequent order. That’s how we can afford to do that.

JD: Yeah. I like that. That’s actually really cool. It incentivizes people to just get going, but then it doesn’t lock you guys into offering that 10% off in perpetuity.

Sophia: Yes, totally. Actually, what we’ve been using another app that was recommended to us by the same guy who told us about Wheelio is Carts Guru, and that’s for abandoned carts. That has been, also, a total game-changer.

JD: How does it work?

Sophia: Carts Guru? I think the beautiful part about Carts Guru is it actually texts customers, so if we have their phone number on file, we can text them and remind them that they have a discount if they make a purchase, and this is after they’ve abandoned their cart.

JD: Nice.

Sophia: Yeah, that’s been a game-changer.

JD: That’s fantastic.

Sophia: Yeah.

JD: You guys are using Unific, currently, for targeted email receipts, or is it a different platform?

Sophia: That’s right, Unific.

JD: Okay, fantastic.

Sophia: They’ve been awesome.

JD: Well, we’re just about at the end of our time together. What do you think the future looks like for you guys? You’re going to continue to grow. Are you doing anything on Facebook Messenger? I mean it’s kind of the hot thing that everybody’s talking about right now. Have you tested anything there, or is there just anything that you would like to share that you’re excited about?

Sophia: Yeah. Actually, that’s what I wanted to talk about.

JD: I read your mind. We didn’t even talk about that prior to the call.

Sophia: Yeah, Facebook bots. I don’t know enough about it, so I’m not really going to go into depth, but that is definitely on my radar for this month, for January. I’m taking a course on that, I’ve signed up, and just really mastering that because it sound like that’s going to be the new email workflows. That’s how we’re going to communicate with customers because email is just saturated. There’s just too much noise there. I’m really stoked, really stoked, to explore that further.

JD: Very cool. Well, Sophia, what a great company, Waiakea Spring. Where can people learn more about the company? Where can they connect with you if they want to get connected with you and kind of follow your journey at Waiakea?

Sophia: Yeah, sure. Well, first, you can visit the website. It’s waiakeasprings.com. That’s spelled W-A-I-A-K-E-A, kind of a tough one. Or follow us on Instagram. We’re super active on Instagram. It’s our number-one platform. We produce a lot of awesome content. We’ve got amazing influencers on there, super proud of it. Yeah, follow us, and check it out.

JD: Fantastic. Well, thanks for being on eCommerce in the Trenches. Best of luck to you, and I look forward to talking to you again in the future. Thank you, Sophia.

Sophia: Thank you, JD. It was a pleasure speaking with you. Thanks so much.

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