The Wild Ride of Retail: Adapting To A Changing Ecomm Landscape With California Cowboy

The Conversion Show

In this episode of "The Conversion Show" podcast, Erik Christiansen interviews Drew Clark CEO, Founder, and Director at California Cowboy. Drew opened up about the rollercoaster ride of running a retail business, especially with the crumbling of the digital and seismic shifts in e-commerce. From website redesigns, site speed, and content creation to the return of physical stores; Erik and Drew cover the essential tweaks that can skyrocket your conversion rates.

Erik and Drew discuss:

• From fires to covid, how California Cowboy bounced back in the face of unpredictable challenges.
• The digital shift and its impact on marketing.
• Product features and design elements of California Cowboy apparel.
• The highs and lows of return on ad spend.
• Website redesign + speed, growth trajectory, and conversion rates.
• Community, cost-saving, and creating a collective experience through sharing retail space with local brands.

Host: Erik Christiansen, CEO of Justuno

Guest: Drew Clark, Drew Clark, CEO, Founder, & Director at California Cowboy

Transcript:

Intro 00:00:05

Welcome to the Conversion Show, a podcast that's all about. You guessed it, conversions, everything that gets you to your goal, whether that's purchase, lead capture app, install content downloads, chat engagement, or demo requests. We're talking conversions hosted by Erik Christiansen, CEO and co-founder of the leading conversion optimization platform, Justuno. On the conversion show, Erik sits down with industry-leading marketers, e-commerce growth experts, founders, and entrepreneurs to chat all things conversion marketing. Be sure to follow the conversion show podcast to be notified when a new episode goes live. Like what you hear? Leave us some love with a review. And now here's your host, Eric Christiansen.

Erik 00:00:50

Welcome to the conversion show. Today is a special day. It's our first in-person interview. Here I am joined by Drew Clark, CEO and founder of California Cowboy. California Cowboy, Do you want to share a little bit about California Cowboy? Sure. You guys are done?

Drew 00:01:09

Yeah, We make after sport apparel that's kind of designed to help you enjoy life offline as all of our product kind of has designed features that enable you to put your phone away. There's a dry pocket on the back of most of our products and it come with conversation cards. They're really fun. It can help you start or stop conversations, subtle reminders that it's so fun to talk to people in real life instead of just sliding into their dance.

Drew 00:01:36

And then there's also bottle pockets of package our shirts and robes.

Erik 00:01:39

You can lock your phone?

Drew 00:01:41

We do make a product at all, and we call it the pocket pouch that actually prevents electromagnetic signals from getting to your phone. So this is very dark edge technology fabric that you slide your filter to the pouch and you kind of put it down, and it's just committing to yourself and your loved ones and your friends that you're not going to look at your phone while you're trying to enjoy life with them. So we're kind of all about celebrating the outdoors, celebrating each other and togetherness. And you know, we know our way around a few beers.

Erik 00:02:12

So originally based out of San Francisco, you're here we're in now a popup store in Fairfax. Shopify.

Drew 00:02:22

We are on Shopify.

Erik 00:02:23

Shopify POS, I was in their store in Fairfax. Anyone in the area, go check it out. Shopify POS, klaviyo, really nice. We're talking about tech stack here, so I went into Drew's shop last week. I wrote that up and thank you. I use it every day in the shammy on the inside. Perfect. I don't need a towel anymore.

Erik 00:02:51

I walked in there and we started chatting about the last two years of business. And so for today, at any retailer that has experienced the third-party cookie demise and what it's done to your business, we're here through story. We're the last couple of years and then where we are today and how we're moving forward and being successful and run our retail businesses.

Erik 00:03:16:09 - 00:03:23:12

So with that said, you shared with me your ten x A6'S so let's start there.

Drew 00:03:23

Sure. So a lot of trolley here, but so that we've been around for quite for a kind of a while. We got pretty good at e-commerce in 2019.

Erik 00:03:35

Frame founded in 2000.

Drew 00:03:37

2016 and hit the market in 2017. Had a big bump on the road because our store where we were keeping all of our inventory was basically on fire. So we actually literally lost all of our inventory to fire it in the first year of business, which is pretty tough, but kind of recovered in 2018. And then really the end and e-com in 2019 and got pretty proficient with them kind of in the fall of 2019 and then in 2020 were really soft races.

Drew 00:04:14

Now COVID obviously happened, but we make product that's kind of designed to be outside. And so that was timed pretty and pretty well for us that COVID caused a significant number of problems for our supply chain. But, you know, e-commerce was get so our numbers were so good, in fact, that, you know, we make really unique and distinctive products.

Drew 00:04:36

And we were you know, we were working with a great agency that was really able to do a couple of different things for us.

Erik 00:04:43

Your price points a little higher.

Drew 00:04:44

The range. Yeah, we're premium slash luxury price points. So our shirts, you know, were a little bit less expensive. But you know, we've had to increase the price because raw materials and labor costs. But you know so right now our our shirts range from around 125 to 170.

Erik 00:05:03

I think.

Drew 00:05:03

Shirt that's kind of short Jacket.

Erik 00:05:04

Yeah. And I know Nicki's had her her robe for like about on the pulp street store years ago so. We're talking six-seven years. I don't know.

Drew 00:05:17

The durable great products so you know we make really great fun product. We're kind of unique in that our brand is seen it positioned as an outdoor brand. But there's there's a and there's a fun element to it. So you know most outdoor brands are that fun. Most luxury brands aren't that fun. We're one of the few kind of outdoor to like luxury premium luxury brands that actually takes our product development and our execution very seriously.

Drew 00:05:44

But we don't take ourselves too seriously. And you know, there's beer pockets at a lot of our stores. So you can imagine, you know, the way that we think about.

Erik 00:05:52

Well, it comes with the Koozie.

Drew 00:05:53

Yeah, yeah.

Erik 00:05:54

I'm like with me, right? Or those watching the YouTubers here's accused there comes with every.

Drew 00:06:02

So yeah I know this is new found product.

Erik 00:06:07

Is this is this Cowboy?

Drew 00:06:08:28 - 00:06:30:17

It’s one of our older shirts so you know we make great product and it is really it works pretty well for online advertising and we got really good at selling it in store at retail, which is what my background is. But we got pretty good at selling kind of it, putting our value proposition together with, you know, creative ads.

Drew 00:06:30

And when we started, we've been on Shopify by the whole time, but we launched our agency, the guy who is kind of the head of the agency was like, Your guys' product is awesome, your brand is awesome. We're driving qualified traffic to your site and is just not converting. So he's like, we have to redesign said we basically took two months off from driving and traffic invested in redeveloping and redesigning the website both for a better brand and customer experience customer journey and brought a new team in to Shopify that was more effective.

Drew 00:07:06

And we then started traffic again after this. This guy had kind of done all this work with his team and our numbers just went the rest away. So we were kind of, you know, burning cash on it first. And then all of a sudden we went from like, you know, boss back day ads on social media, Facebook, most primarily Facebook and Instagram are better now, but we were you know, we were kind of getting like a one or two before the site redesign.

Drew 00:07:37

And that after we did the site redesign and tweaked our creatives a bit, we in many cases we are between a six and a 1314 return on that done. So that is basically printing money.

Erik 00:07:49

I'm like jaw dropping, like I'd never want to get back to hear what those things were that.

Drew 00:07:56

Yeah, I can talk about that too. But you know, we were kind of novices when we started and now I know you converse well.

Erik 00:08:04

Which is standard. I think that e-commerce like it's very much learning as you go for so many successful people.

Drew 00:08:12

Yeah, So that was great. We, you know, our numbers were so good that we, you know, we had been kind of pitching investors on our brand and our business for for a while. But it was in kind of 2020 when we started just absolutely crushing it, that people started to really take notice. We're growing pretty quickly and we actually were able to raise a couple of bucks institutional funding, and that was great.

Drew 00:08:42

So that enabled us to invest in inventory. You know, our team out a little bit, professionalize a few things that you're right scrappy and and also do so work to counter refine and brand positioning.

Erik 00:08:58

Do you think that getting that funding a lot of are you happy you took that money in terms of did that allow you to do to grow more fuel on the fire, so to speak?

Drew 00:09:09

It's certainly been the first year here. What at the time the strategy was very much like the strategy for, you know, literally hundreds of other track in Sumer apparel, CPG, you know, anyway in making consumer products which was throughout grow and razor seed or series or series B then eventually exit. So we kind of raised our round tail or market and if we'd done it a year or two ahead of what we did would have been different story.

Drew 00:09:46

But as I'll explain right now, you know, tell you go at it. So basically back in in 2020 and just lighting it up first few months of 2021, we were just absolutely crushing to iOS 14 apples. You know, kind of privacy rollout started to take its impact to late February, March, still doing pretty well kind of through the spring by the tail end of kind of like April.

Drew 00:10:16

And then when we started to get into it, we started to see with the advent of iOS 14 and, you know, most our customers, you know, what I saw most of our customers, how iPhones, we saw, you know, pretty good product. So that's that's who our users are. The message if not most, it had a significant portion of our our traffic was beta from mobile.

Drew 00:10:41

You know we saw it as that adoption kind of start-up. It went from you know five or 10% of Apple users to a 60 to 70% of Apple users. We just saw our driver that's not restricted to Apple. So we kind of initially said we are June is our biggest fear. So basically spent a ton of money you know trial by the revenue forecasted by our efficiency was dropping at an alarming rate and we probably should've made some other pivots and what we did, but it basically cost us a lot of money to kind of take the numbers of one.

Drew 00:11:20

So by the time we got to kind of the end of 2021, we were trying to go out and raise our series A, we saw pretty significant difference in the capacity were able to deliver just for efficiency perspective.

Erik 00:11:35

And hearing you speak to each individual month. I mean, I can barely recall what I did two months ago and you have this each month. How's it feel talking about it today? You know, that was two years ago. Yeah. It seems like it's fresh in your mind.

Drew 00:11:53

Yeah, it is a kind of a traumatic experience because things were going so well for, you know, for a really critical period and kind of scaling of business. Yeah. And it it's, it still remains. It's fresh. And I think it's kind of the trajectory of it and how it impacted me.

Erik 00:12:13

But I mean, you're not alone in this. You have a group of other retailers you kind of…

Drew 00:12:20

Yeah.

Drew 00:12:22

You know, the direct to consumer businesses have all struggle either to kind of keep their businesses afloat and in many cases they've had to downsize, which is certainly been the case with us, you know, really painful not to take some of the steps that we both for me personally, you know, my team and our customers. But yeah, there's things that had to happen that were were really tough and including, you know, what what you've seen happen now is that all of these businesses that Yeah.

Drew 00:12:58

Said they would never up in a store like guess what we have to open a retail store because the cost of acquisition online became so inefficient that it actually started to come into parity with the customer, you know, walking it straight to a retail unit operator, retail store. And people also started to other sales channels like wholesale to not only try to get out of this discounting factor, but to find other ways to lower, you know, the acquisition cost, which was, you know, once very, very efficient.

Drew 00:13:31

And any business it's operating now pretty much just have about strategy. You can't just be this digitally native brand, the tidal wave of sort of consumer use of e-commerce. It happened kind of threw out of it. It's you know, it accelerated by now. So that wave really crashed and then roll back in a way that I think very few people predicted kind of across industries.

Erik 00:13:57

I mean, pre pre-COVID, you know, we were always saying, look, online retails only it's still single digits percent of of global retail. And then you know Harley until seen he spoke a lot about this during COVID of how you know we've seen in you know what was supposed to happen over ten years happened in one year in terms of the shift online.

Erik 00:14:21

They rode that tidal wave as he spoke of and it was exciting about the time, you know, as GCs were emerging, as having been a retailer, the ability to so efficiently get to a customer and it cuts out so much red tape with distributors and that entire world. What so as you are trying to manage this, it sounds like present day, it's about, you know, we can kind of skip maybe forward a little in terms of because we don't need to rehash those memories.

Erik 00:14:53

And a lot of our listeners have lived through that. And for the last two years you've been living through this. So over these last we'll go through these last two years adapting and then present day. So adapting, it sounds like, okay, you have a brick and mortar store now. You had the one on pulp though. Was that dirt, what year.

Drew 00:15:14

20 2017. Yeah, it is 25. Yeah. Yeah.

Erik 00:15:20

So in the how is it for you, you have a background of retail so you know, but now you're in spring, now you have to like plug in distribution or like now you're managing a brick and mortar. Now you are, are you doing wholesale. A little, little bit.

Drew 00:15:36

So very, very constrained, which is kind of the opposite problem that many retailers have had. We we've never had a problem with demand for our product. We had it had two layers. But yeah, initially kind of the beginning of the supply chain kind of getting cut up and then see, you know, flashing forward. We had to shrink that business aggressively to kind of get off of the ground at any cost.

Drew 00:16:02

Yeah. Hamster wheel in which the market is boarded up through the middle of 2012, like into we're actually not going to try to grow out. We're going to try to pivot to profitability, which they started to reward that that philosophy, that perspective.

Erik 00:16:21

The technology world is not much different.

Drew 00:16:23

Or quite like. So that was a very, very painful decision that we had to make.

Erik 00:16:32

What are you know wholesales.

Drew 00:16:34

We tried shrinking the business.

Erik 00:16:35

Yeah I mean wholesale is a different business to run and I know Shopify and BigCommerce have been working to build that into their software to take it on. Have you seen other DTC brands like successfully adapt and understand that market.

Drew 00:16:55:28 - 00:17:39:13

I think a lot of people are and everyone kind of has their own niche. You know as far as Shopify goes, Shopify has tried to, I think, get themselves into the wholesale business better. It's the the economics are particularly favorable for brands like it really makes sense. You had a DTC business, but the way that they of charge for wholesale is astronomical really at least looked at it and we just connected we can describe it like what it is we're going to be paying them a ton of money or very little functionality, despite the fact that would make things a little bit easier.