A weekly podcast with the latest e-commerce news and events. Episode 144 is an interview from eTail East with Tommy John founders Erin Fujimoto and Tom Patterson.
Erin Fujimoto and Tom Patterson are the founders of Tommy John, a vertically integrated consumer brand in the underwear category. They have recently expanded to include direct to consumer, woman’s apparel and are now opening their own stores.
In this interview, we cover a wide range of topics including the origin story, direct to consumer versus wholesale, the challenges and opportunities of being a digitally native brand, omni-channel expansion, and the future of commerce.
Don’t forget to like our facebook page, and if you enjoyed this episode please write us a review on itunes.
Episode 144 of the Jason & Scot show was recorded on Tuesday, August 8th from the eTail East tradeshow in Boston.
Join your hosts Jason “Retailgeek” Goldberg, SVP Commerce & Content at SapientRazorfish, and Scot Wingo, Founder and Executive Chairman of Channel Advisor as they discuss the latest news and trends in the world of e-commerce and digital shopper marketing.
[0:25] Welcome to the jason and scott show. This episode is being recorded live at the detail east trade show and rainy boston on wednesday, august eighth.
I’m your host, jason retail. G goldberg. Unfortunately, scott had a personal conflict and couldn’t make it, so you guys are stuck with me, but to make up for it, we have to really exciting guests for this episode.
Tom patterson and aaron fujimoto are the founders of tommy john, a a digitally native vertical brand in the apparel and underwear category.
Tom and erica, welcome to the show.
[0:57] Hi, jason. Thanks for having us.
[1:00] I am super excited to jump into it.
I know you’ve listened to the podcast before, um, and one of the things we always like to start with is getting a little background from our guests about how they came into into your roles. So maybe tom. We could startwith you.
[1:16] Shirt mind was not a natural transition. I’m a former medical device salesman i got in underwear but frustrated with the fabric fit and function in my undershorts, buying fitted suits, starting my dress shirts, and icouldn’t figure out why are all the undershirts bagging boxy?
So in two thousand eight, i had this idea and created some undershirts and started selling them online with aaron, and five months later, the follow it happened. I was laid off my medical sales job and i decided, you knowwhat?
I don’t want to be this could’ve would’ve should’ve guy have this idea? I want to see how far it can take it and cash up my four oh one k savings used my friends that all the credit card companies that financed the startupfrom there, that is a very cool origin.
[1:56] That is a very cool origin story and it’s crazy. If you had just gotten in a more casual job, we’d all be walking around with annoying t shirts that don’t tuck in.
[1:59] You have just got in a more casual job. We’d all be walking around with that noise. You’re totally right.
[2:07] Yes, say. Ah, thank goodness for the formal attire in the medical sales industry.
[2:12] There’d still be a lot of guys talking their undershorts inside their underwear, which is not a great visual.
So i think if i could be a part of saving that, i feel it’s all worthwhile.
[2:17] No, and thanks for putting that in my head.
[2:22] Very cool. And, aaron, how did you come to the.
[2:23] Michael and aaron, how did you come from?
[2:25] So i actually have no business being in the apparel in fashion space, either.
I transitioned from a career with jp morgan as a financial advisor, and i got the entrepreneurial bug when i was,
there, and i actually started a small website selling organic products, natural prague, skincare, stuff like that.
And i had a lot of fun with building that initial website and choosing all the products and getting the site launched.
And then when it came to the marketing side of it, actually promoting the site, i kind of lost all interest.
But, you know, tom and i had the entrepreneurial bug, and we’re always idea ting on, what can we dio that could be impactful? What are some of our pet peeves in the world? Would what are some of the things that wehate?
And this idea of a simple undershirt that would stay tucked in and was fitted to the body, was the idea that took off.
[3:18] That is awesome. And because scott is not here, i get to take advantage and just solve all of my personal problems on the show.
Some, some listeners, will know my wife is in the same industry as i am. So we always had this.
This ah dilemma that we, you know, both do our day job all day long. And then it’s, the main thing we have to talk about when we get home after work on.
If i’m not mistaken, you two are also married, eh? So i’m wondering if you have any. Ah, tips or advice for working with a spouse, or how that, how that’s going for you guys.
[3:52] So tom and i have always had complementary skill sets.
And, you know, he used his medical device sales background as kind of just how to get this thing off of the ground and use his skills.
Teo, you know, pitch to buyers and broken to our first account. Neiman marcus and i was much more behind the scenes and kind of more on the operational side. Basically, anything that could be done on the spreadsheet.That was my job.
[4:16] That seems like a good division. I have a similar division with my wife were very complimentary because she’s talented and i am not so there’s that that that was a shadow tow to my wife and her in laws of therelistening.
[4:17] That seems like a good division.
[4:26] No, my wife and her in laws.
[4:30] So let’s, talk about tommy. John, can you give us, ah, feel for how big a company tell me john is today.
[4:31] So, john, you feel for,
so so. We’re a private company, so we don’t disclose revenue but were ten years old. We turned ten years old in april.
Um, you know, for us, you know, we now disclosing, but i can tell you, we’ve grown five times since twenty fourteen.
We just sold our five million pair of underwear earlier this year, and we open up our first or last fall.
We’re gonna be opening up our second brick and mortar store later on at the end of this month in august in charlotte, north carolina is so a lot of exciting things, um, that have happened, and still to come.
[5:07] Very cool on dh. In the beginning of the show i introduced you is a digitally native vertical brand, this ah phrase that i think andy dumb done, the ceo, founder of bonobos, invented.
Usually, when we talk about digital native vertical brands like rightly or wrongly, most people sort of imagine that their initial model wass, we’re going to sell direct to consumer in your case.
Well, i sort of do you think you’re doing native vertical brand because you are all of those things?
I’m not sure that was your original model, right? Like when you first sort of i d ated the product problem and your solution to the problem.
Did you guys envision that? You’d mainly some director? Where you thinking about selling through a wholesaler?
[5:52] Not at all it was really built to be a wholesale business and with my background being strategic selling to get in contact with the department store buyer was very similar to getting a touch of the hospitaladministrator a doctor, a surgeon,
but i think what we found is you know, wholesale as it started to grow, we couldn’t grow as quickly as we wanted to in two thousand twelve we really started focusing more on that direct to consumer channel building adirect relationship with the customer.
[6:17] And i think that was a really in critical part because getting the insights and the data i’m the feedback from the product as a really allowed us to continue to innovate and deliver a better product to the customer and ithink what we believe that tommy john we really focus on fabric, fit and function,
and having your ear on the floor at a wholesale department store is great feedback from actual in store experience, which we did a lot of in the early days and we still do,
but we also have that real time feedback online that’s immediate ce we look at the omni channel experience as a full three sixty feedback loop that helps us continue to improve the customer experience improved productwhere you may have some challenges on fit,
fabric, whatever but also thinking about what aren’t we delivering the customer that they want or maybe they don’t know that they need yet that we’re going to bring in, deliver, too the next two or three years.
So i think the digitally native vertical brand, i think i hope that term will go away. I think it would just be it’s a brand.
The brands in the twenty first century have to be on a channel. They have to be at all channels, where the customer is the end of the day, and i think what you’re finding is digitally native on ly, brands,
are kind of their growth is becoming very limited by not having that offline experience with what we talked about, over eighty percent of transaction still happen off line at the end of the day.
And i don’t think it’s goingto flip in the next couple years, the opposite.
[7:37] No, i would. I would till i agree. And i would at least hope the definition people have in their head. And i suspect this is what andy originally meant.
Will evolve. Like, to me, digitally native doesn’t mean you have to sell online.
It means you were born in the era when digital was already an equal part of the eco system.
So you need to think about how you catered shoppers that air, using their digital tools to make purchase decisions, and all of those it’s more to me. That’s. What the d m means, then, necessarily, we have to sell everythingthrough a digital champ.
[8:10] Yeah, i totally agree. I mean, you have to be digital today.
I mean, if you look at a lot of brands, every digital is the fastest growing channel for pretty much everyone today, yeah, for sure and it’s.
[8:20] Yeah for sure and it’s funny like ah, i’m a fancy consultant and so you know, a lot of our clients have gone through this phase where they’ve hired a chief digital officer.
[8:21] Funny. Like what fancy consultant and it’s, you know, a lot of our clients to the space, but he hired a chief digital officer.
Um, well, bye.
[8:30] And you know, we are i chuckle one of my own body my old boss is the chief digital officer at ibm i’m like, what is ibm need a chief did like who’s not digital at ibm right?
[8:33] My old boss is the chief officer of ibm. I’m like, what is ibm needed, chief who’s? Not yeah, right, like and so do i think, it’s. What?
[8:40] Like um and so i do i think it’s what?
Putting digital in front all this thing is one of those temporary things right?
And ah so i do have a point of curiosity though, so you have this original product inside that like, hey, you know, the ubiquitous product everyone’s familiar with,
doesn’t doesn’t mean the need and you guys invented a great solution on that product and then you’re going to go sell it into a bunch of retailers and the traditional wholesale model,
every week i watch shark tank and they make it seem like you can’t possibly sell a product to a retailer unless you have a shark to make the introductions for you.
Andi, i have a hypothesis that that’s that’s sort of b s s o i’m curious like did you find like having ah great product did you find you were able the open doors and have conversations with merchants and sell it in or was itreally.
[9:36] Up for sure, i think differentiated product is one thing that buyers look for more than anything else.
And so we already had a unique product that really stood out from everyone else.
And i think what you see today is a lot of brands air focussing in differentiating their business model,
and the product isn’t often of forethought where the product is really from day one b been the be all and end all to our to our business.
And if we don’t innovate in the product and keep improving on it, people will catch up and we’ll become stale and that’s. Something that we’ve always really pride yourself on is.
How do we not be happy with where we are today, but continue to improve and, well, there’s.
The iphone five six seven eight we’ve also had different interational of many of our categories and in styles over the last ten years and building the pipeline out very far, much far further beyond twenty eighteen.
Where we are today is a really important part of building a longevity and lifeline into the business.
[10:33] Very gold. Eso started the company in two thousand eight, predominantly with a traditional wholesale model in line two thousand twelve. You really turn on the gas about selling direct, primarily the website.
And then it sounds like last year you opened your first own store. Um, can you talk a little bit about, like, what? The mixes today of, like, direct sales versus wholesale?
[10:55] Yeah so we are primarily online so more than fifty percent of our our sales are direct online and we still have about over a thousand points of distribution through wholesale,
our first stores in king of prussia and that we call it a learning lab because everything about it is just learning,
first of all you know to sell men’s and women’s underwear in a retail space and men’s underwear specifically that’s a kind of a unique experience for most men,
they just haven’t had their own personal space in a store where they can go buy men’s underwear,
so there was a lot of learnings and we knew we needed to make it a new experience so we have you know, local brews on tap per seco on tap and large,
so fun because we have a lot of families that she’d like to shop our brand and,
yeah we try to make it a real experience to walk through we have comfort concierge that walkies through and give you a guided tour of all the products that features and benefits because our products do pack a lot offeatures they’re not just kind of standard you know,
pick pick anyone there’s you know a lot of people have specific preferences and we’ve had a lot of learnings with our first retail space so we will be running,
plans to open more stores.
We have our next store opening in south park mall in charlotte, north carolina after labor day and more stores to come in. Twenty nineteen.
[12:19] Very cool. And i assume that second story was located primarily to be convenient for scott wing go.
So, um, he he will appreciate that one. I spent a lot of time in the king of prussia mall, so that that totally worked for me. I’ve had to spend the night and that’s that mall many times.
[12:25] Oh, yes, of course. Special requests.
[12:37] Maybe you guys did, too, when you’re putting this door. Ah, but i am curious, like the original decision to open that store. Was it, um, i mean, what? What was the impetus that made you say up?
Now is the time, and like what? What did you hope to get out of opening your own store?
[12:54] Well, i think, you know, just homes point earlier. We want to be everywhere that the customer is.
And while we have a lot of presence through our wholesale partners and you know it gives it gave our brand a lot of prestige and credibility, being behind some of these wholesale names.
But at the end of the day, we still want to have very close communication with our own customer. We want to own our own data, understand the data, understand how we interact with our customers, what our customersexpect to see from us.
And we take our customer feedback very seriously, whether that be around product, the experience, anything that they want to see from tommy john.
So those conversations are so important to us.
Yeah, and we also wanted teo be able to control the brand experience because at the end of the day, it’s underwear. So we try to make it as fun as possible.
And, you know, we the only way to get that is either through our website or in our own retail setting, where we can interact directly with the customers.
[13:53] And i think to the other things that we looked at it’s, obviously lease availability is an obviously ideal. So you have to look at a handful of of locations and also proximity to new york city’s. So we could have a lotof presents from our team at headquarters to really like aaron talked about a learning lab.
How do we have different teams there, testing different user experiences for the comfort concierge’s team?
Two questions that we asked how the store’s merchandised not really to see how good the beer tastes on tap that’s not really important part of that, but it was it was early on, but not so much anymore,
but so, yeah, i think our criteria for stores of little different, too, and the fact that were, for the most part itself on a business, we really have to be profitable very quickly in a market and ideally, new york city would havebeen the market.
We opened up our store selfishly, because we’re based in new york city.
But new york city rents are very expensive, and we really think our customers are all over the u s in philadelphia is a great representation of the u s and general,
versus the coastal city like new york or san francisco, where buying behavior and tourist concentration may be a little different.
[15:00] Cool. And you did mention early on that being in the wholesale channel helped helped you get a lot of feedback from customers. You primarily had a lot of prestige retailers. So i i imagine that added some prestigeto the brand.
But now that you have your own store, i’m assuming, ah, that you like. The feedback loop is much faster and, uh, presumably richer.
[15:26] For sure, i mean, early on, you know, the first two years i was pretty much in stores irn aaron at times, but i went over ninety north from stores.
[15:34] And was busy paying all the bills.
[15:35] Yeah, she was very busy in the spreadsheet. See, i was just checking facebook in stores, but going to ninety stores over a year period and spending full days on this in the store, talking to salespeople, training thesales.
Team’s, talking to customers was vital to really where we are today, because what do you like about this? What would you change?
And a lot of our product ideas were inspired from that feedback from customers.
So if anything, and i still think you can learn more in a store in ten minutes and anywhere else today and that customer face face experiences really valuable.
So if anything, we really pushed our team being in stores our store more often because you can’t it’s, not all data driven a lot of it you just can’t interpret.
We don’t believe without that experience.
[16:22] Oh for sure and it ah well there are tools but for the most part like the online experience the customers you have a best relationship with online are the ones that had the best and worst experiences,
so like they had some horrible problem and they called customer service you get to know those customers pretty well,
and the your most loyal customers that proactively reach out you might hear from but the overwhelming majority of those customers in the middle,
the online experiences pretty anonymous right and so you know it’s harder like there are tools to kind of you know look at the analytics and watch how people are behaving but i’m one hundred percent with you,
being able to stand in a store and see how you know how people are interacting with mannequins how many products they’re taking into the dressing room you know are they asking for help from a sales person are theynot all those sorts of things,
there’s a rich source of insight that,
seems much easier to get out of the physical environment than the digital environment at the moment,
i am curious just ah from the boring technical stack thing s o we have a direct website i think you guys on shopify if i’m.
[17:31] Is that right s o so you’re on shopify you’re having released successful director consumer channel via e commerce now you open your first store and you need a point of sale system and the inventory system for thatstore.
Did you, like, try to pick some omni channel things, like, did you extend the shopify eco system to the store? Or did you just like, how did you?
[17:54] That’s. A tough one, that’s, something that we’re still working through, and that’s.
Why we call our king of precious store a learning lab, because thes air, all the kings and it’s it’s a big, you know, i think many brands are probably struggling with us howto integrate online with the retail environment andit’s, a real problem.
So e think there’s a lot of opportunity, but, yeah, we’re,
we’re definitely looking into its hot on our radar and just teo integrate that customer experience so it’s seamless, because so many of our customers do go back in force from retail to online and back again.
So, you know, we just launched a loyalty program. So how do we, you know, get them engaged on loyalty, to able to shop in any environment and take advantage of those parts?
[18:38] Oh, and i actually want to come back to the loyalty program. But one question on the that decision is open.
A store that had physical inventory. And, like what you see, some new brands are opening the ah showrooms or, ah, guide chops from bonobos.
Nordstrom, who i think is, ah big partner of yours, now has some some white inventory stores in l a, the north from local stores.
Did you guys think about that model and all? And how did you decide?
[19:08] Horse, yeah, way didn’t think about it, and we did some focus groups before we did our actual opening store opening, and,
the focus groups, loud and clear, said that they wanted to walk out of the store with product and, you know, it’s, i think, it’s, that instant gratification of shopping and retell you want to touch and feel the product you wantto see.
Is this going to fit? You know, you maybe want to try things on, and you want to walk out of the store with it, right?
And the great thing is, is that if there were anything that was missing in the store, we could ship it to them overnight from our website.
So we have the benefit of being able to fulfill that way.
But at the end of the day, the customers still wanted to walk out with a bag in hand, get.
[19:52] Okay, um, the and i there’s something we haven’t talked about yet, but i now realize we need to bring it up so that i can ask my next question.
You and you sort of alluded to it. Aaron, you guys on lee recently expanded into women’s apparel as well, is that do i have that right, eh? So we’ll come back to the women’s apparel, but i’m i just wanna get the sequenceright.
[20:14] Did you decide to open a store and then later added women’s, or did you know you were gonna have men’s and women’s before you open the store or didn’t happen at the same time?
[20:25] So i think we wanted to open up a store earlier ended up being pushed later but we knew women’s would be coming down the five and be part of the brand and be launching shortly after so,
a lot of when we opened up the store we wanted we didn’t want to lose sight of,
having men’s and women’s in there at some point some day making sure it’s a unisex experience and the great thing is we had a lot of women already in the store buying for their husbands or sons for gifting,
and we were able to get feedback and really understand what was you know important to them in the shopping experience,
selfishly to point earlier i think having a guide shop where is really very limited inventory is much easier on a business,
it’s much less of an inventory burden and i think most brands would be crazy not to do that if their customers are asking for it,
but i think we’ve always believed in the customer’s always right and the customer really guide you towards the right experience,
and who knows we could be talking to you three years from now saying you know what we actually have virtual showrooms people don’t need to try on underwear and t shirts and socks they could just come in touch feeland they can wait two or three days to receive it online.
[21:34] In the mail so we’re always open to change but i think what we’ve seen is this the velocity of change today in our space, it’s so much quicker than it was two or three years ago.
And i think, that’s. The challenge of a lot of systems is a lot of brands invest in systems arguably too early.
And then they’re outdated very quickly, where we would rather not painfully, but,
learn as we go before, we make a big investment, because first, we need to understand what stores means to our business at a larger scale than one or two stores, to really justify some of these bigger investments that aremore infrastructure driven.
[22:08] Yeah, and as as faras our stores, we have tto learn very quickly and react very quickly, because our goal is, well, our stores have to be profitable.
Everything we do in our business, we’re not heavily funded, were not happily vc backed, so we have to make our retail experience profitable as soon as possible.
So if we see that pivot, if we see the customers are responding in a certain way, we lean in very quickly, and our entire team is on board with that strategy of,
being nimble, maintaining nimbleness, always learning right cause even the environments changing so quick that things that we knew six months ago, let alone a year ago, are completely changed.
Like we have to constantly be testing and re learning and revisiting old things. That didn’t work, you know, six months ago, because maybe they work now, and it means it leads to higher revenue.
[23:02] And that that is a great insight. That’s really hard to internalize, right?
Because, you know, you think about all the clients i walk into, and the most common reason that a client doesn’t want to try. Something is, oh, we tried that once, right, like, you know, back in the day someone tried that.
[23:11] Mine doesn’t want to try. Something is, oh, we tried that, right. Like, you know, back in the day, right, someone tried that, and, like, access is about having the right idea, but also at the right time and your point.
[23:19] And, like, you know, success is about having the right idea, but also at the right time and your point.
The customer expectation is always moving. So just because something wasn’t right in nineteen ninety, by no means means it’s. Not right today.
[23:25] My expectation is always moving. So just because something wasn’t right ninety nine.
Yeah, we may have fifty stores, and we’ll still be calling him learning labs. You know, it may still be changing that quickly. Where we don’t have a reform. You’ll figure it out. Yeah.
[23:41] Yeah, i do. So i have a personal wish for you. Having worked with a bunch of retards that start opening stores, the first door is a huge disruption to the business, right?
Because everybody’s got a day job, and now they have to put their day jobs aside, and i’ll get in the car and drive from new york, philadelphia, and you’re like, you know, there with a sawed cutting store fixtures and figfiguring everything out,
and, you know the business kind of stops while he opened that store,
usually by the tenth store it’s like, oh, we have a system now, right, like i pick up the phone and i call i call my store guy and i say let’s, open a store in this market and.
[24:13] All my store guy and i say let’s, open a store in this market. And, you know, there’s dedicated employees in the process.
[24:18] You know, there’s dedicated employees in the process, and it becomes much less disruptive to the to the business.
[24:23] So i’m hoping that you’re able to short circuit that a little like the second story. Still still probably pretty bespoke. But hopefully you continue growing twenty nineteen year able.
[24:23] So i’m hoping that you’re able to short circuit that i like the second story, still probably pretty bespoke.
But hopefully as you continue grow in twenty nineteen year able, the tow, have it not be such a big disrupt.
[24:33] Have it not be such a big a great point. I think the second store has been easier than the first, just based off of simple things that we learned.
[24:43] Yeah we were we did a show recently with the founders of beta which is this great brick and mortar,
concept that started out on the west coast it’s in it’s a shop and shop in macy’s in new york now see you can check out but he was talking about like oh our first store the fixtures cost a fortune and they were all made out oflike exotic woods,
and he’s like the second store the pictures looked exactly the same but they were laminating right yeah.
[25:11] Oh, yeah, you learned fabrication really quickly.
[25:13] Yeah, i mean those. Those were just kind of the common evolutions. You, you mentioned that they even were just a men’s brand. Like we still have the care to female shoppers. That, to me, is always one of thefunny and.
[25:13] Yeah yeah i mean and those are those air just kind of the common evolution’s you you mentioned that he even were just a men’s brand like we still had to cater to female shoppers that to me is always one of thefunny insights,
when you’re talking to people about opening a men’s store like and i’ll make a joke about where the man chair is going to go right like and you know the man chairs this metaphor for where the dude sits down while thewoman shops and they’re like we’re not gonna have a man shareware we’re a man store,
and i’m like yeah but you still like you’re still gonna have couples walk in and the guy’s gonna plop down on the chair while the wife goes shopping for him,
and so i was curious on your couch is that they were man couches or whether they’re they’re multi gender couches it sounds like.
[25:57] Front, everyone couches, right? I mean, sit down, have a beer couch.
[25:59] They’ve definitely been multi, multi, jenner. I mean, well, i remember black friday morning at like ten a m we had some,
eighty five year old woman come in and sat down on the couch and drank two beers well while her grandson was shopping or her someone shopping, so we haven’t had to kick anyone off the couch because it wasovercrowded.
But yeah, i mean, i think if anything, it just allows people to rest and there’s no pressure for their spouse to hurry up and buy your stuff so i could go to this store.
It could be on their phone and it’s more of a comfortable experience, and i think that’s one thing we’ve really tried do it because we’re brand based on comfort, having comfortable furniture, comfortable sense.
When you walk in the store, we really try to think about the entire user experience from the moment you walk into every second that you’re in the store, too, the moment they walk out.
[26:47] Very cool. Let’s. Talk about the decision moving.
Ah, tau women’s. Where for a second, like you, you’ve built a well known, highly regarded brand and men’s where, like his has that translated to women like.
Do women, you know, have a preconceived notion of your fit in quality based on the men’s brand? Or you having to start from scratch?
[27:08] Yeah, those were so the launch was in april of this year, and we sold out of six months of product in our first six weeks.
So we were out of stock for about two months, and we’re now slowly getting back into stock, so you can say it greatly exceeded our expectations.
You know, there’s, a lot of we knew that we’d have a strong customer following just with our existing customer base.
Like tom said, we have, ah, ah, pretty large, built in female customer customer base, already who’s shopping for her significant other or family member on who’s a guy.
But, you know, we we knew that that was going to be there, but overwhelmingly.
I think, you know, people just gravitate to the brand. I think we built a reputation much stronger than we knew, known for comfort and function and innovation, and really giving the customer what they want anddelivering on our promises.
[28:05] And i would add that i think about five years ago we started hearing when you’re going to make women’s and every year up until last year it seemed like it would just become louder and louder from from womensaying you know i want to be as comfortable as my husband is and i think,
aaron talks about someone posted on facebook that this is what it’s come to after where my husband’s boxer briefs because nothing is this comfortable,
so that’s when i think it really made sense for us really guard now is the time to do it and to the category and,
bring deliver comfort in a new and unique way that we believed in exists before in the women’s category.
[28:40] I feel like if you’re going to really deliver on that brown brand promise, you’re going to have to address shoes, because it’s like that seems like the biggest disparity to me and men’s and women’s comfort in theworld, but, ah.
[28:41] If you’re gonna really deliver on that brown brand promise you’re gonna have to,
but that seems like the biggest disparity to me and women’s comfort for women’s high heels and stilettos and stuff like that yeah.
[28:51] Yeah, exactly, yeah, yeah, ah, that, yeah, women totally gets screwed on the shoot comfort thing.
[28:55] That yet women telling it screwed on us you comfort i’m utterly convinced.
[28:58] I’m utterly convinced, ah, but ah, and i guess one more point on the women’s brand, that’s interesting to me, like a lot of times you have a successful means brand they expend and women by inventing a new brand,and i actually think even buddha boasted that, like they invented a.
[29:00] What and i guess one more point on the women’s brand that’s interesting to me like a lot of times you have a successful means brand they spend in women by inventing a new bird don’t you think even boasted thatlike they a program for women.
[29:13] Different brand for women that ultimately spun off, you guys decided to leverage the brand and sort of expanded, like, was that something consciously that you did? Or was it just?
[29:15] You guys decided to leverage the brand,
and it was that something consciously that you did or was it just wait?
Yeah i mean it was really never thought to create a different brand. When the brands that we admire, whether it’s, patagonia or nike or lose a lemon, they never created another brand.
You know, we’ve always believed that comfort doesn’t matter if your men are manner woman.
Everyone deserves to be comfortable in their underwear and it’s really hard to build a brand and to build another brand.
I think it’s been very few and far between, where brands spun off and created a male and female brand that have been able to scale to the same levels.
We’re for us. We felt there was so many center jeez in the men’s business with the brand awareness, recognition and distribution that we have, that we wanted it, really. I don’t think we thought about it. It came up acouple of times, but.
[30:07] No, i mean, we definitely did our due diligence. And, you know, early focus groups that we spoke, you know, spoke with various women throughout the country, and just, you know, ask them about the brandname.
If that was going to be a turnoff in any way, or with that, steer them away from shopping, you know, for women’s underwear with the brand called tommy john.
And, if anything is, it was funny. Wasn’t a reaction that i expected. But they said they actually felt like there’d be more innovation because they feel like men’s.
Clothing in general, gets more innovation on dh has generally has more technical and smart properties to the fabrics.
So if anything, they they liked it. Have it.
[30:45] That’s. Totally fascinating, it’s almost the inverse you were seeing that sometimes in ah, beauty, like where men want want men’s products, but they want them from aa company that makes women’s companiesbecause they perceive there’s a lot more.
[30:50] City like where men want one minute.
[31:00] R and d behind the the products.
[31:01] Yeah, interesting.
[31:04] I do want to pivot for minute. We teased loyalty earlier, um, and that, like, superficially, i go.
You know, when i saw that you offered a loyalty program. Have to be honest, i’m like what’s. The frequency of purchase of of underwear, like you know, is like you don’t have a huge breath of products to solve a bunchof different problems for the customer.
What what was the thought process behind loyalty and and how, how is that going?
[31:30] We’ll repeat, is such a huge component of our business, so, you know, starting out underwear, it’s.
We want people to fill their door, would tommy john underwear, so and you have to replenish your underwear. You have to replace them every so often, and we wanted teo. We want to be the brand that people go to.
So that’s always been a huge component to our business model and it’s.
It will always continue to be so it’s, very important to us that customers have a reason to come back, and that we reward our best customers for being loyal to our brand.
[32:02] On one of the things i noticed about the loyalty program is it’s. Ah, not exclusivity, rewarding people for purchasing the product. So it feels like there’s.
Multiple triggers that can earn earn points. So it does seem like you’re you’re trying to entice people to engage with the brand.
[32:17] Yeah, definitely. Definitely. The interaction is important. We want to encourage people to also write reviews,
you know, share just who they are, you know, i mean, and just kind of start engaging in and, you know, there’s many different things that we can just kind of give, incentivize small points for just to get that initialengagement and,
kind of have them start navigating through the platform as well, because the more they use it, then they’ll kind of know where it is and how to get back to it.
Check their points, how to redeem points, so it allows them to get familiar with the system as well.
A question i have to ask on scott’s behalf is about funding, right? So scott’s, a serial entrepreneur, is, you know, taking several companies a company public, and been very successful.
Ah, and so he, you know, likes to talk a lot about the sort of vc legacy for companies. And you mentioned that you hadn’t raised any money through a traditional vc.
Was that overt strategy?
[33:16] Way haven’t so so starting in two thousand eight during the recession i think we,
we start out where we had to sell the dollar for more than a dollar versus selling a dollar for say thirty five cents to build top line but we did raise a small round of funding of one point five million in two thousand twelvebut what was really important to aaron and myself was to maintain control the company,
and by having slower arguably slower, more profitable growth we’re not chasing evaluation that we have to live up to and the pressures that that.
[33:45] That come around that where we really put pressure on ourselves to grow the brand the right way and built for longevity and quality and duration,
so our approach has been a little has been very different i think especially from a lot of the brand’s you’ve seen emerging just the categories in general the last three or four years,
where you can grow in two or three years maybe what’s taking us to grow ten years but is it sustainable growth is a profitable growth can they become profitable at some point a lot of that is still to be determined where,
it’s a lot easier to spend someone else’s money when it’s not yours so we talked about earlier we had to be really thoughtful with our money whether it’s stored we have to look at stores differently because they need tomake money,
when we look at building the products that you know, they they have to be able to support the infrastructure that we need to scale over time.
So we don’t have a lot of pressure to grow. And, um, we we do like pressure to grow. But it really comes from ourselves. I think at the end of the day, if you have anything else to say, said.
[34:47] It is interesting it annoys me a little bit like one of the challenges with the v c model is once you take that institutional money,
the successful outcome they’re looking for is a billion dollar exit right and so like there really is no happy medium where your ah,
ah profitable company that’s you know sustaining a bunch of employees making customers happy in your your you know, even half a billion dollars a year in revenue,
you’re you’re still not a success to your your institutional investors,
and to your point what we’ve seen a lot in these did you donate a vertical brands is,
you you build a brand promise that appeals to a certain market size right and depending on your product and the promise and the category that could be,
you know, one hundred million dollars a year with a business or it could be ten million dollars a year with the business or you know there’s some sort of organic cap that your brand positioning earned you,
but if your venture funded once you hit that cab you have to keep buying more customers and that’s usually the point when you start seeing people do really stupid things,
um like ah,
you know these crazy customer acquisition costs and you know i think there’s been some companies and went public recently where they’re paying like fifty one hundred dollars customer teo to acquire customers and itjust seems like like what’s the payback on that right, like.
[36:17] Yeah i mean you know as a business we don’t we don’t look teo enter a category unless it has ah replenishment nonseasonal component to it so whether it’s underwear or t shirts or lounge where it’s something thatpeople will need to continue to buy throughout their life for a,
or some of these products have ah repeat within five or ten years so we know that there’s going to be a repeat revenue stream coming in so the customer turn is in this high as some other categories,
we also don’t have tech valuation there’s a lot i think there’s been a lot of tech valuations in this space where it’s not a nap it’s not a software it’s actually a product,
so i think they’re coming back to reality now with how the evaluations of the companies in our space or being evaluated,
but it’s been painful valuations or down rounds for a lot of the companies that we’ve seen in this space.
[37:02] Where we’ve seen a lot of brand to come and go over ten years you know?
So i just think you know, every founder makes a different decision for what they think is best to grow their business and they try to make the best decision they can with the information that they have at that time,
but i think what i’ve learned to a lot of conversations a lot of people regret taking so much money early on,
and if anything if they could do it over again they would have grown slower,
and maintain control of the company and try to figure out how big the business model was and helping the revenue opportunity was within that category where i think a lot of um i’ve just been over valued the market sizeisn’t this biggest they think it is,
and then on top of that they have a lot of pressure to make it bigger than it probably is going to be ever,
where you know underwear is actually one of the few obviously we saw.
[37:51] Many products outside of underwear but underwear is actually the only,
category in the last three years that has continued to grow especially the premium space so,
um underwear doesn’t last for decades we’ve actually found with some of our customers it does unfortunately,
but there is there again that whether it’s underwear t shirt socks there’s that repeat component which is really critical to our business,
but that was not white space that we identify before reap built his business by any means it is just something you know this business was created off from a problem that i wanted to solve,
we’ve really taken that problem solving mindset to other categories and use the learning so what we have um,
to continue to grow but also minimized the level of risk and inputting the business in a position where we may go out of business or we may need to raise a large amount of funding.
Tohave, a lifeline we’ve never wanted. Put the business in a position where we were exposed to something like that.
[38:47] Yeah, no, i don’t. I don’t blame you. Um, i also have a perception that early on, one of the things that you used help build your brand was some influence or marketing.
All right. And the in my in my head, i feel like i’ve seen maybe too many pictures of kevin hart. Naked is that is that.
[39:03] I mean i don’t know where you’re seeing naked pictures of kevin i haven’t i haven’t seen those.
[39:07] Semi naked sigh in comfortable loungewear.
[39:08] Say my name you know we’ve been comfortable way we’ve been fortunate to know,
a handful of influencers howard stern ended up getting our product and talked about how he’s never been so comfortable but it was after he try the product we didn’t even pay him we’re now ah paid advertiser on thisshow,
but kevin ended up posting on instagram three or four years ago and someone in our office a tom here and check this out kevin hart to dancing around in our underwear with the shirt off,
not naked and he saw his underwear away span and,
i knew someone who could connect me to kevin sent him a note said hey i’m a huge fan congrats on all your success here some more underwear and a couple years ago he was in new york and said, hey, i’m a huge fanthe brand can i come meet with you i just want to learn more about the company,
and i just love everything you guys are doing so when we look at influencers we’re not paying people,
to promote our product actually kevin paid us through through ah meaningful investment in the brand because he believed in this so much and as a result you know kevin has one hundred million social media followers.
[40:13] The most successful comedy tour of all time and is just this honest hardworking, funny, relatable guy it’s also very thoughtful and a lot of things that he’s done, and we just had a lot in common.
He’s, like tom it’s, taken me eighteen years to become an overnight success.
People think i’m this overnight success, but they don’t understand it.
Been doing this since i was eighteen years old, and i think the way we have built tommy john, we had a lot of empathy for each other in the way he’s built his business and hollywood not having any connections inhollywood.
Us not having any connections in the fashion, retail space and it’s just been amazing partnership for us.
And we’re actually launching our second, kevin hart to point online this october, the sex over with him, which is really exciting, and i definitely want to congratulate you understanding.
[40:57] Very cool, and i definitely want to congratulate you on deciding put pictures of kevin and underwear on your website, and not howard i. I’m glad he enjoys the product.
[41:07] I’m just saying, probably a good aesthetic decision.
[41:07] Nothing, probably.
[41:09] Um, the i am curious, the like they’re so i totally get that and that’s very different than paying a kardashian toe tweet about your product.
[41:11] I secured the right there. I totally get that and that’s very different than paying a kardashian to tweet about your problem.
Yeah, in my mind, that sort of payed mega influencer technique has kind of played out.
[41:20] In my mind, that sort of paid mega influencer tactic has kind of played out.
I think customers see through that and know that that’s, not authentic, but we’re starting to see emerge.
[41:26] I think customers that and know that that’s, not antic, but we’re starting to see emerge a lot, sort of.
[41:32] A lot is these sort of micro influence, our campaigns, where brands partner with,
non celebrities that have, ah, you know, a niche falling in a particular category, like is, if you guys looked into that at all, is that something you could see being part of the,
the marketing mix at some point?
[41:51] I’d say never say never more than anything when we pick any of our partnerships, it’s,
usually comes from a place of authenticity so it’s an authentic partner, somebody who’s a true fan of the brand or were a fan of them and we see our great alignment and alignment and our values in general,
that was what was so great about kevin is that he came to us and just said, i’m a fan of your brand, how can i help?
How can i help you? Right? And that was his approach, and, you know, we were so stuck in our heads saying, well, you know, we don’t we’re not really looking to endorse anybody, we can’t afford to endorse anybody wecan’t afford it endorsed kevin hart, you know,
and he’s had to really just shout loud like, look, i’m trying to give you my money,
i take my money and i want to help i want to help you guys grow, you know, and and we’re kind of thrown back by that thinking, well, this guy’s real deal, he actually just loves the brand he’s a fan, he wants to be a partof it, he wants to be part of the growth, and,
those are the types of partnerships that we would look for very cool.
[42:53] Very cool s o unfortunately wouldn’t be a jason and scott show if we didn’t talk about the book resellers in seattle.
Ah, amazon, right? And ah, you know is interesting is the number of years ago amazon sort of announced this like,
you know, shift to get into the apparel business, and back then there were a bunch of people predicting like, oh, apparel is way different than the other categories.
They’re not going to be successful fast forward about four years, and it seems like the evidence is,
they’re very successful in apparel, but it’s a specific subset of apparel like it, it is the basic needs stuff, more so than the luxury fashion stuff at the moment, right?
Like, i’m i’m not betting against them, the jury’s out on the long run on the the fashion stuff, but i’m curious is that scary to you?
Because you’re in the underwear category, which kind of sounds like basic needs?
Or is the fact that you’re a premium, differentiated product, like, really put you insulate you from some of that success that amazon’s having, or are they a potential partner?
[43:59] I think it comes down to you know, of course they’re a threat just because of their sheer size, right? And and when you talk about market share, anybody that’s competing on market share and taking that that awayis a potential threat.
But guess where we don’t get so scared is that it’s not necessarily what you do, it’s, how you do it,
and i think we’ve, you know, prove to our customers, and we continue to prove to customers that we’re here as the loyal brand, we have a strong line of communication with them.
We’re here to serve them, and we really listen and take into consideration what they want, and i don’t know, i don’t know if amazon, if anyone’s really been able to talk to amazon and tell them what they want,
you know, or if they have, ah, open ear to listen and unnecessarily here, that so i think what we’ve built as a brand and how we continue to communicate and engage with our customers is what separates us.
[44:55] Yeah, i think the relationship is really important. You know, loyalty is something that we want to offer. We really wanna have a deeper, more meaningful experience.
And, you know, there’s restrictions and guidelines that you have to work within within amazon, that we just don’t feel are.
They just there. It’s not fit for us at this time, but you never say never.
You know, things change and models models evolved, so i think we’re open to the future. But right now, at this point time, it just doesn’t make sense for us and awaiting question.
[45:22] I want you and related question. Like, when you talk about the big market places, one for a brand.
One of the issues that always comes up is authenticity and counterfeit products. Like, have you guys run into that at all? Is that something you’re having to battle in terms of?
[45:33] Yeah, run into that and always battle with counterfeits.
[45:39] Yeah, in terms of people knocking off your product or something.
[45:41] Of course yeah i mean yeah i think there’s been a lot of brands that have reinvented underwear since after we launched but i think it goes back to you just we actually embraced competition competition only makesyou better,
but like i think what we’re always thinking about it what are different types of partnerships whether it’s kevin hart i’m doing you need things with nordstrom how do we deliver value to our wholesale partners how do wedeliver value to our existing customers?
A lot of it comes back to the product and continue to innovate and evolve as a brand,
and you know and also i think what we’ve really enjoyed as as we’ve grown is we have a unique way of talking about a very uncomfortable topic underwear and a more funny in a funnier, more relatable way and that’ssomething i think,
brands need to continue to do is just,
i think authenticity is a very overused word everyone’s talking about it you have to be yourself and you know it took us seven or eight years to really figure out what our tonal voices and really get it out there in a clean,concise way,
and that’s really when the brand i think became much stronger and the relationship their customers hasn’t is continuing to become much deeper and that just something you can’t get on a lot of other platforms that re sellyour product and i think the brands i can figure that out.
Maintaining evolve. It are the ones that will you continue to outrun the competition.
[47:05] Nice. I think that is going to be fascinating to see how that continues to evolve.
And that brings me to sort my last question.
If you take your sort of today, head off and think about how the industry is going to continue to evolve over the next four or five years, do you have a sense for how different things are going to be like?
Are we, you know, is everyone going to be a brand selling direct in five years?
Our, you know, you know it r is the shopping experience going to be wildly different? Do you have any guesses for, for the future of commerce?
[47:40] I mean, no, i mean, if you told me you were going to be here five years ago, you like, maybe, okay?
I mean, i think a lot there’s so much out there right now, and i think there’s so many things that came into the market too early, whether it’s like a i or chap pods,
and i think we’re still we’re not one of the earliest adopters, you know, like apples, never first to market, they kind of sit back and learn from the learnings from other brands.
That’s, really, how we’ve looked at the market in general, let the bigger brands who have bigger budgets, more money or funding,
let them spend money trying to figure it out, and we’ll come in and at some point well enough that but we’re not really in this space of being the earliest of doctors unless we really feel strongly about it.
And i think it’s been more on the physical product side that we’ve taken that approach, but as faras the systems and technologies we’re not selling ourselves as the tech company, you have to be a tech company today to bein retail, especially, is it digitally native vertical brand,
but i don’t think,
i don’t know it’s.
[48:45] Yeah it’s a great question it’s of course don’t,
very hard to tell where it’s going to go i do see this shift you know,
there’s a lot of the digitally native brands as we talked about you know going into retail going into brick and mortar so obviously that’s a shift there’s an opportunity there right where some of these,
big chain retailers just haven’t involved right and they’re not involving their experience or not involving their product and they’re not involving with the time so,
it is a great opportunity for brands to get into that space and try to do something with that i think there’s going to be a handful of brands that or do it really well and there’s going to be a handful that kind of burnout right?
Because again like we’ve learned just was one store how extremely hard it is to make that store profitable and make sure that it’s a replicable model that you can continue to roll out over and over again right,
and that’s our plan for going forward is you know, twenty nineteen definitely expect to see more stores but you know it’s because we’re fine tuning that model we’re getting closer and closer we know exactly how to,
turn these stores out and make them profitable and i think that’s going to be the future is figuring out,
how to do these omni channel approaches in a scalable way right cause if it’s not scalable if it’s not profitable.
They’re all going to burn out, and you just can’t keep running at that rate. So, um, it will be interesting, and it’ll be interesting to see how it all shakes out.
[50:14] Yeah, i don’t think there’s a more exciting time to be in this space than today, just with how much change and the company’s not being able to change quick enough, which is creating opportunity for brands like usto take more meaningful market share.
But, you know, we may be in that position someday. Where were too slow to change and that’s something that i think continues to drive us is.
How do we maintain our flexibility and nimbleness at a bigger and bigger scale? And i think that’s, the challenge that a lot of brands run into, and we embrace that because it’s a it’s a great problem to have at the end ofthe day because it means you’ve done a lot of things right.
You have to stay on top of all the changes so quickly, right? Since we spoke in the last forty minutes, there’s probably been all kinds of stuff that’s being talked about in our space that no, i’m already behind on because,yeah, because we’ve been doing this for so long, yeah.
[51:03] No, i think that’s a great point and it’s funny, you know, when one of the clients i get to work with is,
the largest retailer in the world walmart and it’s funny, but the guys that have been there a long time tell this story about how they remember being the young, scrappy upstart and they’re like, you know, we always thought of ourselves as david,
trying to figure out how we were going to compete with these big ally it’s like sears and target and ah, kmart and they’re like,
we went to bed one night and we woke up and we’re like, oh, no were to go live now, right on ly there’s, way more david’s, and they have way better slingshots, right?
And so i mean that’s that’s, the evolution of everyone and it’s it’s, it’s wise to be aware of that. And that’s going to be a great place to leave it because it’s happened again, we’ve used up our allotted time as always, we encourage our listeners to jump on the facebook and continue the dialogue there.
Of course. Have you enjoyed today’s show? We sure would appreciate that. Five star review on itunes, tom and aaron, i’m assuming you guys are on the usual social channels can we find where can we find you guysonline?
[52:05] Yeah, instagram, facebook were at tommy. John. Where is our handle and tommy john dot. Com. You confide everything there. Thank you guys very much for the time, really enjoyed likewise, thank you.
[52:13] Thank you guys very much for the time. Really enjoyed the chat until next time. Happy commercing.
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