Blog: My eCommerce Adventure: a Fireside Chat with SixThreeZero CEO

 

 

 

Rachel: Thanks for joining today's Vincit Talks focused on business strategy. For those of you that have never joined us before, welcome to your first time. And for those of you that have, we appreciate you coming back and participating once again. Vincit Talks is a monthly webinar series for those interested in staying up to date with what's happening in tech development, user experience, design and business strategy. To give a bit of context, so Vincit, the company that helps hosts these, we're a custom software development and design agency. Originally from Finland, but have our US headquarters in Irvine, California. And we really created Vincit Talks as a way to drive engagement with notable industry leaders and passionate experts, to help share the latest developments in tech. We hope that everyone that attends these talks, whether they be business owners, developers, designers, marketers or even recruiters, that you're able to walk away with some new valuable information pertinent to your company or your career.

 

Rachel: Today, as we mentioned, we are focused on business strategy. So we're going to do our first ever Fireside Chat with Sixthreezero CEO, Dustin Gyger. And he's really going to share with us his eCommerce adventure and how his digital business strategy has evolved in our current economic climate. And chatting with him is going to be Vincit's very own SVP of Strategy and Partnerships, Sean Richards. So seeing us we're now a few minutes after, I think hopefully everyone's had enough time to jump on in, if they're joining. I'll hand things on over to Sean.




Sean: Great. Thank you, Rachel. Welcome everybody. And welcome our special guest, Dustin, I'm excited to have you. And just a quick intro as Rachel mentioned, Dustin is the CEO at Sixthreezero bicycle company. They're a nationwide company selling bikes mostly online, and they're based in Los Angeles, California. So pretty close to all of us. He started in his ... for a need for more affordable bicycles, and really just exponentially added more and more products as he saw a lot of customers desires for unique bicycles that fit their needs. So he'll be able to talk more about that, a little bit about his background and why he started this company and where he's taking it so far. He's previously held some positions at Firmstrong Bikes, WB Television Network. Specializing in social media marketing, advertising and sales.

 


Sean: So coming into starting his company, he came in with a lot of idea and understanding of how to start and grow business exponentially, including online advertising. So before we jump into our chat, we will be going back and forth between myself and Dustin. I did want to announce, if you haven't saw this already that we are going to be giving away a Sixthreezero gift card. That audience member that will receive that will be selected at random, and they'll be selected before this end of this Vincit talk. So during this time, we'll go ahead and put a link in the chat room of zoom that you can get to the signup form. By signing up, you'll be eligible for the Sixthreezero gift card. And you'll also be signed up for Sixthreezero's newsletter called Journey Club. And we'll talk a little bit more about Journey Club later in the conversation as well.




Sean: So be sure to sign up before we end the hour. And just last note before we jump in, please use the questions and answers at the bottom of zoom. If you have questions that you would like to ask Dustin during this time or myself, and we will try to get to them during this conversation or at the end, where it makes sense. So feel to chime in to the conversation as we move along. So I think we'll go ahead and jump in and get started. And I'd love to ask Dustin if you want to just give a brief introduction about Sixthreezero or yourself and the company?


 

Dustin: Sure, yeah. Thanks. So we started in 2005. We originally started in mostly Hermosa Beach California, focused mainly on retail. I personally grew up in the Midwest, came out to California in 2003. And moved down to the beach and was introduced to these bikes called beach cruisers, which you didn't see too many of out in the Midwest. And basically fell in love with them when we were living in Hermosa. Bike riding culture there, for anyone that knows down the strand is a huge piece of life. And yeah, I just took to it. At the time beach cruisers were on an upward trend. And headless commerce was still in its infancy, especially for the type of product like a bicycle. Which I think is still being developed in the eCommerce world.


 

Dustin: And we popped up a website, found a garage and the rest is history. And so it's been 15 years and we've navigated through the transition from brick and mortar to online. Really a changing environment and the bike world too for our product. And yeah, so we ultimately had five stores going at one point and now we've switched to 100% eCommerce business. And focusing on direct to consumer and wholesale, but with a focus on wholesale to online websites. So no store wholesale. That pretty much, yes, sums it up.


 

Sean: That actually leads me right into my first question I want to make sure and ask, is we know that your bikes have been seen in such big retailers like Walmart and Target and Kohl's. But can you talk a little bit more about why you chose to focus online only for your brand and why the brick and mortar change to online happened? And any advantages, disadvantages that you found there?


 

Dustin: Yeah. Originally when we started, in 2005, I think eCommerce in my mind I didn't have a business awareness. So I think there was this fear that you couldn't sell online if you didn't have a store presence. And our strategy or thought process was the store, having the store added a certain element of trust to the consumer. And so we lead with a store strategy first and the online was a marketing platform to drive into the store. I think also, again, staying too much in the comfort zone of looking how the industry had operated. The bike industry in particular, was very much dominated by stores. And thinking the need of having to have things assembled and go to your local store, made us just think that that's the way we needed to do it. And then I think over time, and so our business was always about a 50/50 split early on between eCommerce and store.


 

Dustin: And what happened over time is we were riding the wave of the beach cruiser market in general. So that was trending up, which was allowing us to have these stores specific to our product line. And we made it through the 2008 downturn just fine because we deal in more of a lower price point versus some, bike, normal bike shops have an average price point of about $700 or more in the $300 range. But yeah, after we came out of 2008, basically 2010, the beach cruiser trend fell off a cliff. And there just wasn't enough local demand to support localized stores. The other thing that greatly affected us was Google's search algorithm change. And I know a lot of businesses out there went through that. They changed their algorithm, made a massive update and basically localized the search results. And so what we were at that point, we were able to drive ... before the change, we were driving traffic from all over the state of California. Our stores were mega stores.

 

Dustin: So we were able to pull in people from 60 to 120 miles away because they wanted to come to the beach cruiser store. And after the localization with Google happened, it really cut our traffic down by like 80%. And so it's the whole strategy of the local marketing and everything really needed to change, and we just couldn't do it fast enough to drive enough people to support the rent. And we're also finding that driving local demand to a beach cruiser store, let's say local demand, meaning within a seven mile radius just wasn't enough people. And so at that point, the stores started to dwindle. And in general, the bike industry has been a lot of consolidation over the last 10 years. Bike stores have been closing. Less bikes haven't been getting sold but bigger stores have been selling more bikes. And smaller mom-and-Pops are closing, which I think is true of many industries.

 

Dustin: So it went from about 4400 bike shops which down to maybe 3300 now, I haven't checked the exact number. But yeah, that just it was a natural progression. I can't say it was 100% strategy and going against the grain. It was the market just telling us. And then as it is now, we've decided to focus exclusively on online and really put our resources so we can try to be a leader in developing online technologies around buying a bike online. I think a lot of, there's still a lot of bike shops out there. And they're focusing on still the brick and mortar selling tactics, which there's still a market for that. But we really want to do innovative things, both on the platform side, and the process side, and the logistics side. So for us not having infinite resources, it just makes sense to foc channel everything into one ... Yeah, one strategy and so far so good.




Sean: Great. Thank you. That's awesome information knowing there's always going to be a challenge with online marketing that changes with Google and other technologies that challenge us. I did have one question before my next one that came from an audience member, that's it's contextual to what you were just saying is how many bikes a year do you bring into the market today?

 

Dustin: Well, I don't want to disclose too much on that front. I would say looking at it this year, the bike industry is up about 400%. And we're definitely in the thousands of bikes a year. So and looking at the bike industry as a whole, actually, I don't have the numbers recently. But yeah, I mean, there's millions of bikes coming into the US per year, which leaves us a huge opportunity. And we're still growing. And the interesting thing is the online is still a very small percentage of that overall.

 

Sean: That's great. I think coastal, you will probably have a chance to run into your bikes up and down California for sure.

 

Dustin: Yeah, absolutely.

 

Sean: Yep. For my next question, it was really to piggyback on the challenges you were talking about related to Google. What are some of the other challenges beyond that, that you've, you would suggest an eCommerce based business similar to yours, that a traditional retail store just doesn't deal with? Maybe things like inventory and shipping logistics or similar?

 

Dustin: Yeah, I think there's many things. I think one thing is definitely the back end logistics is getting product to people on time. Especially now that you're competing with the likes of Amazon. And people are expecting everything to show up at their house in two days, regardless of it being purchased on Amazon or being purchased from you. So a big struggle for me is how do I execute to that level with a small business. Fortunately now, in this day and age there's a lot of logistics companies that are popping up with these networks that seemed to work, that can be plugged into API's through websites and make that a lot simpler. It's interesting, because when we started a lot of these apps and plugins and all these things didn't really exist. So it was more of the wild, wild west in terms of how can you streamline the business.

 

Dustin: But I think the other big challenge, which I think is very similar to brick and mortar around finding a location. For eCommerce, it's really platform. And I think the scalability of your platform, the usability of your platform, how it functions, keeping up with it. That's been a big challenge for us. Again, especially as a small business, finding the extra capital to invest into your platform to stay up to date on the newest technology. Right now in the eCommerce world, I mean, if you're not updating your website in a year, there are lots of new plugins, apps, things you can be using that could be literally saving you thousands and thousands of dollars a year from a personnel standpoint, from a speed to customer standpoint. Yeah, and I think when you look at the eCommerce landscape, you see a lot of websites that maybe aren't up to the highest level. And there's a lot that can be missed by not having a site that's current.




Sean: Yeah, that definitely makes a lot of sense. And we're going to talk a little bit later about your customers and customer service and how technology has changed that. But before we get to that I wanted to ask is, has there been anything that just outright has shocked you while growing your business good or bad? Anything that just you didn't expect and it compelled your business to move forward or presented a challenge that you had to face?




Dustin: So many things. I think going back to what I said originally about Google, I think that was the biggest shock. We were one of the early companies to really take advantage of the Google algorithm. And quite honestly, that's how we built the entire business was by getting ranked number one on Google. And, again, back then Yahoo, AOL and Google all existed as search engines. And Google started to emerge as the clear leader after, into the later 2000s. But when we started, obviously, there were ways to really cheat the system. And the whole idea of the algorithm and the improvements wasn't something people knew about. We didn't really understand what Google's strategy was going to be and how they were going to refine it. And quite honestly, how important search was going to become culturally.

 

Dustin: I think that we look at Google now as the end all be all of all answers to everything. But back then there were ... nobody knew, no one knew anything about it. And so when the algorithm changed, it really was a big eye opener around many things. One being the diversification of your lead gen in your marketing and not being 100% reliant on that. Because if your number one position goes away, then your whole business could be gone. And I was mixed in with a whole pool of other customers that are companies that suffered the same thing. So and we were lucky to recover from that, and diversify, and switch to more white hat tactics on SEO and things like that. But that was a really big changing point in terms of everything. Because that also was the beginning of the end for the retail stores.

 

Dustin: And it also proved to us that the majority of our store traffic was coming from Google. I think back then, again, we didn't have the tracking and analytics that we have now. So you always had a gut feeling that Google was driving a lot of store traffic. But you couldn't really, you didn't, we weren't really able to correlate it as much as you can today. And so it really proved everything. And it also proved to me that the eComm was the future. And that was the turning point. That was really one of the things where it's like, okay, if we do this right, if we do it well, we could drive way more sales. And yeah, and that's what happened. I think the other thing that's happened in recent times on the product side is the tariff situation. That was a big, big eye opener. And I think for all companies in the US was how quickly your cost basis can change.

 

Dustin: For us in particular, in the bike industry, our import tariffs were 11% on standard bikes prior to the Trump administration. And after they went up to 36%. So from a cash flow perspective, from a pricing perspective, that put us in a really, really tight circumstance for about 14 months because we were working with our retailers to raise prices and raise our costs to them. And it was challenging because a lot of people were trying to hold their ground saying they would go away, while we were basically working on zero margin to survive. So I think those are two of the most major things in the last 15 years.




Sean: Yeah, that's pretty incredible. I think the way you've been able to adjust, and I know we haven't talked about your growth since the pandemic has really shaken everybody's business. But we can certainly get to that and a little bit how your growth has increased substantially. One of the, when you talk about searchability, one of the companies that ends up in every single search you can possibly put out there because they have every product out there is Amazon. And I noticed that you've also made sure to maintain an Amazon store as a complement to your core website. Can you just tell us a little bit about, your thoughts behind an Amazon store? How did that increase your visibility in search results? And do you recommend that for other eCommerce product companies to take that approach?

 

Dustin: Yeah. So there's actually multiple ways to sell on Amazon. We are actually a wholesaler to Amazon. So we're, they're retailing our products to their consumers and we sell to them. I know their other option is to have a seller account. We found the best relationship in particular with our product and our size of product to work by selling wholesale to Amazon, because we can really tap into their network of warehouses and their shipping rates to consumers, which allows just exponential more volume. In terms of strategy with Amazon, I think it's what a lot of businesses, eCommerce businesses will say it's one of those things where it's great to have but also challenging to manage. Their pricing algorithms can change your retail price in a moment, in a second. And it can do whatever it wants based on different variables. So that can provide a challenge if you're trying to not have customers call you.

 

Dustin: For us personally, I've found it to be a hugely beneficial relationship because of the exposure. And I think, I'm just gonna spew off a metric here, I don't know if it's correct. But I want to say 50% of all product searches start now on Amazon, something of that nature. So when we look at it, I look at it as a sales partner. I also look at it as a search relevancy and marketing partner. So being number one on Amazon now is actually ... number one from a position for a keyword is probably worth more than on Google. Unless you have a brick and mortar type business. But if you're online only being in that number one product position on Amazon is huge. I've seen other eCommerce websites do just direct to consumer and not be on Amazon, and it's worked for them.

 

Dustin: I do think the benefit of having Amazon and partnering with them is the ability to minimize marketing costs. If you're going to build an eComm direct business and be solely eComm direct, you really need to have a great digital marketing strategy from social media to your search engine optimization, to influencer to make sure you're driving traffic. With Amazon if you have a great product and great reviews and you can get organic results, you've just immediately gotten thousands and thousands, if not millions of eyeballs on your brand name and your product. And a lot of those customers are going to go into Google and search your name. And a huge percentage of them will buy direct from you. Because they want to buy direct from the brand. Now with that said, the challenge is holding margin, is maintaining a good margin. I think if you have a strictly eComm direct business, you can maintain a little bit higher margin.

 

Dustin: But again, I think there's a little bit more front end work in building the traffic and the reputation. The other big challenge for us has been a bicycle doesn't have the same buying cycle as other products. So the benefit, the thing we need is we need to really be driving a lot of new leads to keep sales growing every single year because our customers aren't buying a new bike every three months, four months. If we were in the shoe category, there'd be a much higher percentage of our sales being reoccurring revenue. So the Amazon relationship has been great, because you stay ranked high in search relevancy and you can just be consistently driving more eyeballs on the brand. Which has been another strategy for us is how do you then create more frequency of purchases with a bike even if most people only buy a bike every four to five years? How do we drive brand awareness through Amazon and hopefully get them to buy again from us, and say a year to two?

 

Sean: That makes absolute sense, and I think as you're talking about how to get customers back or we've got a couple questions later around how do you continue to keep your customers engaged? And how they come back? Possibly, whether it's for accessories or follow up bikes, maybe to expand into their family with additional ones. And it's absolutely understandable that the rankings are, can make or break a business. So I think the split store strategy makes a ton of sense. And to dive a little bit more deeper on your online presence, I want to talk some about your website, some of the decisions you've made on your website. So we know everybody, every company has to have a website these days, of course, for an eCommerce company it is the business. Can you tell us about some of the decisions you've made with your website that you feel have made positive impacts of user experience, incurred ... converting your visitors to actual buyers? Yeah, assuming over time you've made some adjustments to that. So maybe tell us about some of the great changes you've made to your website?

 

Dustin: Yeah. Well, if anyone wants to check an interesting website is the Wayback Machine. I think waybackmachine.com or.org is it? And you can look at websites in their original form. So if anybody goes and types in my original site beachbikes.net in there, you'll see there's been lots of change since then. It's pretty funny. I think looking back, originally, the first big change we made was actually going into the Shopify platform. But really it was the platform change. We were operating on a fully managed platform originally. And it made it very difficult for us. We were managing the servers and things ourself. So we moved to a new platform, that was a big change for us, which is actually something we're doing right now. And that helps in so many facets in terms of website speed, the ease of launching new pages, content management, things like that.

 

Dustin: So that's, and that's one of those things that's really changing constantly year over year. And I think the ability to have those processes be simple can really help you leverage conversion rate, get more products up quicker, manage content easier. Things like that. So we've gone, we went through that once before we're going through it right now, because the technology has changed and improved so much. The other thing we've done on the front end, we've obviously, we've tried to add a customization element to our website. And building in a custom questionnaire and a custom bicycle builder actually, where you can change colors, add accessories, things like that. That was a huge piece for us because obviously as a smaller brand, we're trying to fill a niche and really connect with our customers.

 

Dustin: And our customer base really loves the idea of customization to them and to their lifestyle. So it just those really brought the engagement up quite a bit and the conversion rate up quite a bit. And it also gives us an idea to really see and watch like what are the colors people want? What do they want to do to their bike? What product shouldn't care, what's the number one accessory they add to their bike? Things like that. So the customizer and the questionnaire really not only is it to help get the customer their right bike. But it's also to create the engagement and to have them remember us to be something different. Especially in the age of Amazon. You're never going to win with Amazon being the ... the best logistical play is always going to be buying on Amazon without a doubt. They're going to get you the product the fastest, the easiest. So what value can we offer? And they are the customizer and questionnaire with those things.

 

Sean: Yeah, I think that's extremely important when we talk about consumer purchasing confidence, especially now when most people are ordering things online. Things they've never seen in store before have been able to see physically themselves. So it seems like the body fit is a perfect tool in which someone is can understand that something is a perfect fit for them. So I'm glad you talked about that. I did have a question as it relates to have you seen a noticeable change in sales or reduced returns, given the new body fit component on the website?

 

Dustin: Reduced returns, I don't have an exact metric on that. The conversion rate is definitely increased with body fit. If customers take the fitting questionnaire, that core group of customers converts much higher than a customer that doesn't engage in the questionnaire. Absolutely. And it's something like 10 or 15X, what the normal conversion rate is. So getting them into that funnel is huge from a conversion rate standpoint. Absolutely. And aside from that you've also, and I'm just tracking Google analytics when I say 10 to 15%. More of the conversion rate is actually probably much higher because we're capturing their emails and potentially they're purchasing on a mobile phone. And if they're not logged into Google, we may not be able to really fully understand the whole funnel that that customer went through.

 

Dustin: But yes, absolutely. I think the other thing that has been a little challenging for us to really get our hands around metrics right now is because of the whole COVID-19, just sales of bicycles have gone up exponentially industry wide. So the last four months it's difficult to attribute growth to anything in particular. And it's difficult to decipher what is a result of the actions that we've taken and what's a result of just the industry as a whole.

 

Sean: I think we've been hearing that quite a bit from other companies as well, that there's just a little bit of gray area that's leaving it troubling to decipher where it's really coming from. But as thinking about technology, how we capture data and behaviors online, I believe, as we start to see this for a longer period of time, we'll look at the data and be able to start to decipher those things and capitalize on honest business owners over time. You and I had talked before this call about decisions around technology, what technology and what integration, specifically, what decisions you've made on integrations. And I'd love to hear how you go about making the best decisions with the integrations. Whether it's choosing a chat platform, whether it's choosing something that ties to your social media or your advertising? Can you tell us about the mindset you go through when you're making these technology decisions?

 

Dustin: Yeah. It's actually pretty challenging to be honest with you. I think, especially in this day and age where you get 100 emails from 100 different companies that all do the same thing. Different social media plugins, different customer service platforms, things of that nature. So I mean, for us, in general, we'll narrow it down to say three for any platform. We'll do a trial, check it out and make the best decision. But I do actually find that to be personally one of the most challenging things. And I think the other challenge is that once you implement something and train your entire company on how to use it, it could be very challenging then to switch. If you're not happy with the platform or it doesn't have what you offer. And it's there's a lot of resources and labor that goes into getting any new app or plugin put into a website or into your system.

 

Dustin: We are actually going through an ERP change right now. And that's going to be quite the undertaking, and we've hired outside consultants to help analyze the platforms and what our needs are. We've done a process design, where we've looked at what's the outcome and what's the value we're hoping to give back to the customer. So really starting with the customer in mind, and what are we hoping that they will get out of us having that app. And then just working out what our process needs to be to give our customers the ultimate value, and seeing which software or integration would line up best with that.

 

Dustin: But then I still think it's a Hail Mary to some degree, because you don't know till you get in there, and you really plug it in and get it working. And I can honestly say being 100% honest we've had some misses, where we've put some things into play and it hasn't worked the way we want it to. So my suggestion is if you can at least minimize the upfront cost and the more flexibility they give you the better. Unfortunately, now, a lot of these systems and tools want to get you signed up for a full year. And so it doesn't allow much leniency in terms of backing out of it. But yeah, it's definitely a challenge.




Sean: There you kind of answered my next question, which is have there been any decisions you've made with your website that you would caution other eCommerce companies to avoid?

 

Dustin: Yeah, well, I mean, I think the biggest thing for us now is an ERP. And I think if you're an eCommerce direct company, a lot of what you do can be run through a singular platform. And if you have a simple business with maybe one warehouse, you maybe don't need any ERP system. That's one of the benefits if you're an eComm direct business and you're just focused on just selling direct to the consumer. It can be a much simpler technology play and platform play. When you start getting into managing all these different channels and having the inventory across multiple platforms, multiple sales, retailers and things like that. That's when it gets to be a little bit more complicated. And so for me, the ERP has something I've really dragged my feet on, because it's a very big decision.

 

Dustin: But it's proven to be causing us a lot of challenges, especially as we had major volume increase with the COVID thing. So my recommendation is if you're in a position where you want to expand into other retail channels outside of just selling direct to consumer, you really need to find a good platform that can scale with you. And I don't have great advice on that because I'm going through the transition myself, but because eventually it's going to come back to be a problem. I think the hard thing is some of the platforms are very expensive for early entrepreneurs, early eComm direct and that's the issue. I ran into is do you really want to spend several thousand dollars a month for an ERP system when maybe your sales are less than a million dollars a year? So my suggestion is when you get to the level of profitability you feel comfortable with considering the ERP and the platform if you want to expand in other sales channels, it's an important thing to do.

 

Sean: I think that underscores how important it is not to just make a good decision on a platform but evaluate whether your company is actually ready for the platform itself. You said there's some things you had to line up for your business first and then dive into that decision, which is great advice. Beyond SEO and searchability and having a website that really draws that traffic in organically, where are you spending some of your other time, whether it's on social or paid, that are you finding are also good sources of buyers and audience?

 

Dustin: Even for marketing wise? Yeah, so we do a lot on the SEO front. I mean, there's a huge amount of potential in SEO, thousands and millions of keywords that you can target in on. And so we put a large amount of our time into that. We're also now getting into influencer which has proved to be very beneficial for us. I think the challenge for us is we have a little bit more expensive of a product than other companies in the influencer space. I know influencer stuffs worked really well in the beauty and makeup industry, but their product costs so maybe a couple dollars versus ours which are several hundred. In social in particular, Facebook ads have worked really well for us because we're selling a lifestyle. The ability on social to really showcase that in imagery, and photos and videos and content, which is something we think we do well.

 

Dustin: So in SEO and things like that you really don't get to showcase your brand and the results, which if you could show an image and what it looks like prior to clicking it might even drive more clicks to our website. But that's the benefit on social which has worked for us. And quite honestly again, because the demand has been so high through COVID. We've actually been turning off a lot of our marketing channels. Because we came into this year with a whole plan around social and influencer and some affiliate marketing. We had just signed up with Commission Junction to do some affiliate stuff as well. And we ended up turning most of it off or dialing it way back just because there was so much organic search out there for bikes and things like that. And so now we're restructuring and regrouping for 2021. And trying to set forth a whole new digital plan around, okay, when COVID goes away how are we going to pick up these additional customers to continue to drive growth?

 

Dustin: And so our initial strategy now is still social, how do we continue to exploit that? There's a lot of niche lifestyles that we can target, moms, dads, single women in their 30s. Just different groups of customers and riders, college students. So we haven't even really gone very deep into that at all. The other pieces influencer and affiliate, we really want to expand into those. The other thing that I'm looking to do is build a really strategic content plan over the next 12 months, around what videos are we getting out there. I've been working on YouTube for about a year now. And with very little investment we've seen huge results from our YouTube channel.

 

Dustin: And I'm finding YouTube to basically be Google at this point, people are using YouTube pretty much the same as they would use Google. And I've been doing some talking head videos around subjects just related to biking and bike industry, and we've gotten tremendous traction. So I want to double down on that and really be one of the top content providers in the space of leisure recreational bikes just around, helping people find the right bike for them and answer questions. And create some sales funnels that way.

 

Sean: That's all really great news that, as they have said for many years content is king as you can show the right thing or say the right thing at the right time when people are looking for it, you're going to excel in business. To speed up, I know we've got about 20 minutes left. So I did want to touch on your customers real quick though, just to make sure we're talking about how you engage them not necessarily just before the sale but also after the sale. So a couple last questions, and then we'll run into some quick Q&A with some of our other team members. With, obviously, we know that Sixthreezero in terms of business sells bicycles, but obviously you sell experiences as well. And the excitement of the shopping experience and the joy of course, riding the bicycle itself, but can you just tell us a little bit how you engage customers as a business beyond the sale?




Dustin: Yeah, absolutely. So We do have our email newsletter, and we follow up with tips and emails and things. This has actually been another thing I've transformed or overhauled this year, we're still working on. As I found email and the engagement of customers through email to be a little dry and bland nowadays, because everybody's doing it. So one thing we've set up now is a private group on Facebook called Sixthreezero Pedalers. And that's really about getting our fanatical customers into a shared space to encourage each other to post photos and rides and track their rides. And we've also had talks of an app. And there's actually, we actually do have an app in the works right now a very simple distance tracking app. So we can get customers engaged and competing with each other, and riding and tracking. And that's, this is all leading back to the customer loyalty, and the repeat purchasing, and creating more of a fanatical fan base.

 

Dustin: Because, quite honestly, that wasn't part of our strategy early on. And I think I started to realize over time that there is a fanatical base of bike riders in our segment out there that do want to be a part of this culture and it's underserved. It's very well served in the road bike and mountain bike market. But it's underserved in the recreational leisure bike market. So that's part of our plan for the future. And I think a lot of that will revolve around the app, and the Facebook, the private Facebook group. And ultimately trying to get them into the app as we can develop more technology and things into the app, getting them off the Facebook platform so we can own them. I mean, in the sense of they're in our space not Facebook space.

 

Sean: Yeah, that makes a lot have a sense. I imagine and you can probably confirm that reviews from your existing customers and social media mentions are probably a big way in which you get a handful of your referral traffic and sales.

 

Dustin: Absolutely, yep.

 

Sean: Yeah. We mentioned earlier on the gift card giveaway that people that sign up are also going to be joining your Journey Club newsletter. Can you just tell us a brief update on that program and how, what content you distribute there?

 

Dustin: Yeah. So through there a lot of, we'll release new product, letting people know what products are coming out. We'll also put out newsletter regarding some of the best rides in the US. Different locations, cities, things like that. Again, in particular, as it relates to somebody who wants to ride more leisurely, these are rides that are not going to be someone that wants to ride 25 miles an hour for 50 miles. So that's the benefit to our club is we're trying to connect on that more leisure recreational level. So yeah, it's rides in your area, it's new products, it's what's happening, new changes to the website. Things all like that.

 

Sean: That sounds perfect for someone like me, I'd much rather take that leisurely ride as opposed to our CEO Ville Houttu. I think he's special guest and wants to pop in here and say hello, Dustin. And I do have a question for both you, now that he's joining.

 

Ville: Of course, I do. Thanks, Dustin. Thanks for a good presentation, keepsakes for everyone. And we are obviously proud for having you and also being able to work with you as your technology partner on the bikes. Yeah. So if we raised, so I'm ready to go whenever I have a couple of Europe Pod bikes too. In the car also so we have the same gear and I'm not sure if I can actually, I can beat this guy. But maybe with my race helmet, I'll do it fine.

 

Dustin: That's pretty funny.


 

Ville: When do we go?

 

Dustin: At least I went on air.

 

Sean: Amazing. Thanks Ville, thanks for popping in. So let's get to the part of this webinar here to wrap it up, where we would like to take a few questions from the audience. I know if you popped in here, Dustin. So maybe we'll just answer these and then if there's any more questions after that, we can go ahead and do the giveaway before the end of the hour. So just to start the question, you had mentioned that eCommerce scene for bikes is still pretty new. How do you see it evolving in the future? Maybe not in the next three months, but what do you see in the next couple of years?

 

Dustin: Yeah, I mean, I think there's just going to be continued adoption of eCommerce in general. I think this year has been a big shift where we have to wait to see when the dust settles. But I do think eCommerce is going to come out of COVID just having more people trusting the process of buying online. I'm also hoping more people will trust the process of buying bikes online. So I think there's going to be continued trust and faith in buying bikes online, especially as we can develop more technology around how to better fit people to a bike and give them a similar experience they'd have in a bike shop, but digitally. And so yeah, I see it going nowhere but up. And I also think there's going to have to be a more integrated approach to eCommerce and store between the bike industry. And how that plays out. I don't know. I mean, right now it's maintaining a similar structure to how it's always been with the brick and mortar.

 

Dustin: But I wouldn't be surprised to see more of an evolution and in terms of who knows bike dispensers, or things you're seeing in the car industry. I forget the name of that car company that now has the car dispensers. Where you literally show up and it gets, it's like a vending machine for your car. I think when, those industries where there's a lot more money will blaze the trail. But I could see technologies like that coming down to the bike industry over the next five to 10 years as well.

 

Sean: Yeah, really great points. One of the other questions that we had, and of course, feel free to share what you're comfortable sharing. Is what your customer acquisition cost is as a percentage and has it increased or during decreased during the pandemic?

 

Dustin: It's definitely gone down substantially. That's actually a metric. I don't have my finger on the pulse very, very great. Or very well for, I probably should. If I had to guess, I would say it's about 10% of the sale price is our cost per acquisition, which is why margin for us has always been a challenge selling online, especially when we don't have a ton of reoccurring customers. So that's been something that we've tried to shift over the last few years, is to get, how do we get more repeat purchases without having to spend the money? And that's why the bike industry is a little bit more challenging. I think of other industries in terms of selling online, especially at our price point. Which is why electric bikes have opened up a bigger opportunity for us because it's a little bit bigger margin product. Gives us a little more leeway, which you've seen a few other electric eComm direct companies pop up recently and doing pretty well.

 

Dustin: So that whole market is a whole other opportunity in and of itself. But yeah, as I said, regarding marketing with COVID we're very blessed to be in the position we're in with the bike industry. Having now a high unit sales for the last 50 years where we've literally turned off all marketing across all channels, except for our SEO, because that's just an ongoing thing. But we're not really spending on AdWords, we're barely doing social media. And we used to advertise on the Amazon platform, and that's all been zero as well.

 

Sean: Definitely quite the experience there. I know a lot of businesses don't, have to try a little bit harder these days to get more attention and companies like yours are really doing a great job of making sure the exposure is there. And I think through a organic presence that you have again, buyer confidence is definitely up and people are just making it part of the new normal to order products online and feel good about that, based on reviews and quantity of searches they find. So all the presence you have online is phenomenal. We congratulate you on that growth. I think it's pretty amazing. If you're ready I'd love to award someone to get to try one of your new bikes by giving them a gift card, shall we choose a winner?

 

Dustin: That's good.

 

Sean: Any questions that do come in after we just wrap this up, we'll be sure to get some answers and we'll post it to our meetup site for this as well. So feel free to keep flowing in the questions and we'll be sure to get them answered. But yeah, let's pick a random. We've got quite a few signups during the hour. Dustin, do you want to pick an email or a name out of those list of signups today?

 

Sean: You guys can do it, feel free. That way I won't, because some of the people I know so might be better if you ... or if some form we've randomize it somehow.

 

Sean: I think these all might be friends of Ville or maybe they're all Ville, but they are just anonymous names.

 

Dustin: Ville junior, Ville senior, Ville the third.

 

Sean: Yeah.

 

Ville: It's a very common name in Orange County.

 

Sean: Ville, I'm going to have you pick a number between one and 25, and what that number is we'll say the winner.

 

Ville: 25.

 

Sean: 25, perfect. All right, 25. We've got Claire Kim. Claire Kim, you were the winner of $250 gift card from Sixthreezero. So we will get in touch with you or Dustin will get in touch with you and let you know how we can provide that to you, and help you pick out a bike that suits your needs. I encourage you to do the body fit on his website, because that'll actually really help identify what's going to be best suited for you. But I want to thank Dustin, today he's been a phenomenal guest for us and gave us a really good opportunity to do this a little bit differently with business strategy. We are going to resume additional talks in the future related to technology and design.

 

Sean: So our next Vincit Talks will be tech focused, focused on, we'll actually have some special guests from our Finland group to talk about accessibility. So we're tentatively scheduled for August 20th, at noon. Same time as this talk. The date may shift a little bit but we'll be sure to send out communications letting you know. Dustin, is there any parting words or Ville, any parting words before we jump off with our guests?

 

Dustin: No, sixthreezero.com. Enjoy the ride.

 

Sean: Perfect.

 

Ville: Exactly. And if you decide to use Amazon just to point out the ... if you search for a beach cruiser his bikes are the first two results and also the best seller on Amazon. So you can't miss it. On sixthreezero.com.

Thanks for participating.

 

Sean: Thanks, everybody.

 

Dustin: Thank you.

 

Sean: Take care.