Muddy Bites: The Effects Of Going Viral

On July 20th, Muddy Bites went viral in a @fuckjerry Instagram post.

Over 940,000 people liked this post, and it gained almost 16,000 comments.

I have been tracking Muddy Bites sales since March and it is very interesting to see what this post did for Muddy Bites sales.

Muddy Bites Change In Sales Last 6 Months

Between the middle of March and middle of June, Muddy Bites was averaging about 140 orders per day. From the Middle of June to Early August, Muddy Bites averaged 360 orders per day (the reality is there was a major spike of orders just after July 20th). Muddy Bites had to go on a shipping delay in early August because of the increased volume they saw. Because of that, their average daily order volume dropped to about 185 orders per day. In September and October, Muddy Bites averaged 153 orders per day.

The Effects Of Going Viral

Muddy Bites saw a drastic increase in orders right after going viral. Their site traffic spiked, their Instagram followers nearly doubled, and search volume for their brand name spiked. However, this appears to be a quick hit and has not elevated their long-term sales. Their September and October revenue is slightly higher than their monthly revenue was before this viral post.

All these metrics show a slight elevation post-viral vs. before going viral. This could be attributed partly to them going out of stock and then losing the momentum of the viral post.

I am still holding out hope that Muddy Bites can turn all of this interest in their product into long-term revenue growth. It is also possible that those who purchased right after the viral post are not ready to repurchase yet. (My wife has a subscription to Muddy Bites, and she has extended it out to the maximum time of 8 weeks for each delivery).

Lastly, there is always a possibility that people liked the idea of this product more than they actually liked the product when they got it. They tried it, and that was enough for them.

What Could Muddy Bites Do To Drive New Sales?

Come out with a new product! We have seen this tactic work for Nugget Comfort. They bring out new product lines and retire old ones.

And that is exactly what Muddy Bites is about to do

WHITE CHOCOLATE! A new flavor for their audience to try. These launch tomorrow (Wednesday, October 27th), and they are using a scarcity tactic to drive urgency by only offering 20,000 bags. 

I am curious to see the effect of this release on their sales.

More Muddy Bites Data….

Audience Demographics

Muddy Bites has a younger audience that is 70% female. 70% of their audience is based in the Untied States

Facebook Advertising

Muddy Bites currently has 9 active ads on Facebook. I would say these ads look like baseline campaigns and they are not trying any strategy on Facebook at the moment besides getting their product on people’s feeds.

See Muddy Bites’ Facebook ads

Top Paid Keywords

  1. ice cream cone chocolate bottom
  2. muddy hites
  3. muddy bites price
  4. muddy bites 7/11
  5. muddy buddy bites
  6. muddy bites where to buy
  7. where can i get muddy bites

Seeing “Muddy Bites 7/11”, “muddy bites where to buy”, and “where can i get muddy bites” makes me curious what efforts they are doing to try to get their product into wholesale. I know they have had manufacturing issues and have not been able to outsource that yet (they have been manually manufacturing this product themselves). But if they can figure out the manufacturing, wholesale could explode this brand and increase their DTC sales as well. (note they are planning wholesale in Q4 of 2021)

City Bonfires 3x Its Order Volume

I last took a look in on City Bonfires back in late August (see previous article). At that point, they were averaging about 100 orders a day through their website. Now that fall has fully set in, how is City Bonfires doing today?

Their average daily orders have more than tripled! In September, on average, they received 315 orders per day through their website.

Their average order value is estimated to be about $30. In August, they had a run rate of $1.1M through their website. Their run rate is now almost $3.5M in yearly revenue through their website.

How Did They Triple Their Order Volume?

I do not have the exact answer, but I do have a few ideas. 

First, they were already building positive momentum and fall is a perfect time to sell this product

The search term “bonfire” sees an increase in searches during September and October (there is a bump in December and May as well).

Second, search volume for the term “City Bonfire” more than doubled from August to September. In August, that term was searched 6,600 times. In September, it was searched 14,800 times. Of course, the question now is why? And the next two reasons may give us an idea. 

Third, City Bonfires was featured on the Today Show on September 22nd. I have had first-hand experience with having products featured on the Today Show. Typically these sales happen on a 3rd party site (so I would not be able to see the sales through City Bonfires’ website). However, there is often a spillover. People will go search the product name and opt to purchase it directly through your site. 

Also at the same time, the Today Show put out this article: “Bug shied blankets, fire pits and more outdoor entertaining must-haves“. This article featured City Bonfires and linked to their Amazon Store and their website.

And lastly, City Bonfires was featured in a USA Today Article: “12 top-rated outdoor fire pits to cozy up your yard before fall rolls in“. This article does direct people to their Amazon listing. However, I have also seen these spill-over to sales on your own website.

30% Increase In Instagram Followers

In the past two months, City Bonfires has grown its Instagram following from 47K to 62K. Most likely, this can also be attributed to the visibility they got from the Today Show and USA Today.

Is TikTok Advertising Working For Them?

If I had to guess, I would say no. As I have said before, my general rule is if a company continues to advertise on a channel, that means that channel works for them (or they just like to waste money).

I found 3 ads that were posted on 10/5. One ad has received 10,000 views, and the other two had 6,500 and 3000 views. In July, City Bonfires had ads that were viewed well over 100,000 times. 

Their TikTok account only has 187 followers and total likes on their videos only adds up to 953. My guess is that they had some early success on getting views on their ads, but they are struggling to find consistent traction on TikTok.

Facebook Advertising

City Bonfires currently has 88 ads active on Facebook. 1 ad launched in October and 2 Ads launched in September.

In August, they had 140 active ads on Facebook.

See City Bonfires’ Facebook Ads

Side Note: I have seen most companies reduce the number of ads on Facebook from the Summer to Fall. My first thought was this was seasonality, but I am curious if it has anything to do with the effectiveness of Facebook Ads since the IOS update. 

Paid Keywords

August Top 5 Paid Keywords:

  1. smores kit
  2. s more in a hor
  3. tabletop smores
  4. bonbfires
  5. bon bon fires

Current Top 5 Paid Keywords:

  1. portable campfire
  2. fire in a can
  3. portable bonfire
  4. smores food truck
  5. camp fire smores

The current search terms are providing a lot more traffic and are better related to what they are actually selling (they do sell a smores kit but their product is the portable campfire).

Customization/Corporate Gifts

I touched upon this in my last write-up. This channel seems to have a lot of opportunity for them. Unfortunately, I have no way of tracking this channel but they continue to advertise for it on Facebook. My guess is this channel can equal, if not surpass their DTC and Amazon sales.

HOW I TRACK AND ESTIMATE DTC/ECOMMERCE SALES (PLUS AN UPDATE ON NUGGET COMFORT)

This is my 4th-month tracking Nugget Comfort. I am so impressed with their level of business, I am starting to think I might be getting duped. I have been asked many times, “how I estimate a companies revenue?”. 

Here Is How I Estimate A Companies Revenue:

Most eCommerce systems are set up with sequential order numbers. If you place two orders a set time apart, the difference in order numbers is the total number of orders for that period of time.

Then, I have to estimate their average order value. There is no way for me to know for sure what their average order value is, but there are ways to get relatively close. 

First, I look for the most popular products on their website. Most times, there will be a filter on their website that allows you to sort their product listings by most popular (if they are on Shopify, there is a url trick to sort by their most sold products). I will also look at the number of reviews on each product. What products have the most reviews? What products have the most recent reviews?

Second, I look at what they do on-site to try to increase average order value. Do they have a free shipping threshold? Do they offer cross-sells and upsells in the cart? Do they have other offers to increase average order size (i.e. buy two get one free)?

Lastly, I use my 10 years of experience in eCommerce to guess if their products are something that a consumer will buy multiple of.

Once I have the estimated average order value, I multiple that times the number of orders during that period of time to get my estimated revenue for that period of time. I will do this monthly to keep a running track of how a business is doing.

What’s the data I have for Nugget Comfort?

Here are the orders I have for Nugget Comfort:

05/31/2021 – 466342

07/03/2021 – 489470

07/28/2021 – 504958

09/14/2021 – 543882

10/04/2021 – 567670

I break this down to the average number of orders for each month:

June – 700 average daily orders

July – 595 average daily orders

August – 828 average daily orders

September – 1189 average daily orders

Average Order Value:

Nugget only offers a few items for sale. 1 is their flagship product, The Nugget Comfort Couch, for $225. They also sell the triangle pieces and replaced covers for $99. The vast majority of orders are going be for their flagship product. There will be some orders for the replacement covers and extra triangle pieces. There will also be some orders for people buying more than one Nugget. For these reasons, I estimate their average order value is approximately $225.

Monthly Revenue Numbers:

June – $4.7M

July – $4.1M

August – $5.7M

September – $8M

Am I getting duped?

These are crazy good revenue numbers, especially when they have zero ads on Facebook and zero ads on Google. I start to second guess my methods, are they really doing this level of business?

So how could I be duped?

I know that they are on Shopify. And 100% Shopify uses sequential order numbers. However, Shopify does let you put a prefix or a suffix on your order numbers. Some companies will put a few letters before or after their order number. I have seen some other companies put numbers before or after they order numbers. Looking at these order numbers, I am fairly positive they are not using a prefix on their actual order numbers. The only option would be that they are using a suffix, but I am not convinced of that either. I do not see a pattern in the ending of these numbers. And if I were to take off the last digit of the order number, that would make their order numbers only 5 digits. Shopify starts with order number 1000, which would mean they only have received just over 55,000 total orders. Nugget reported on their website in 2019 they sold over 50,000 Nugget couches. 

So unless they are inserting many thousands of fake orders into their own systems, it does not appear that I am being duped. Nugget is really generating that much revenue.

Fomo

Nugget Comfort has used Fomo (fear of missing out) to drive sales for them. Their product has been back-ordered for the past year and a half. But their back-order appears to be coming to an end. Back in June, their lead time was 4-6 weeks. In August, it was down to 2-4 weeks. Today it is only one week (a reasonable time frame for furniture to ship). 

Nugget still does planned limit runs. They will introduce new colors and only run those colors for a limited time period before they “retire” those colors. I have seen them bring back “retired” colors for limited releases as well.

The Buzz

As I mentioned before, Nugget Comfort does not run any Facebook or Google advertising. They feed off the buzz around their product. On Instagram, they are tagged in posts around 800-1,000 times per month. There are groups on Facebook that have tens of thousands of members dedicated to talking about the Nugget Couch.

Here are Nugget Comfort (@nuggetcomfort) Instagram Followers by month:

June – 414K

July – 418K

August – 427K

September – 434K

Where Could Nugget Go?

I have to imagine sales will only increase during the holiday season for them, but after that, I have to believe some of the organic buzz that was created by people wanting these but not being able to get one has to die down a little bit. I desperately want to see if they turn on Facebook and Google Advertising, and if they do, what will their strategy be. More to come on Nugget Comfort. 

How Does BruMate’s DTC Business Stack Up To The Competition?

This week Trends sent out this article: How Dylan Jacob Scaled BrüMate to $100m+ in 5 Years. It just so happens that I have been tracking BruMate for a couple of months. Here is what I am seeing on their DTC (direct to consumer) side of their business.

The Numbers:

In the past 52 days, BruMate processed just over 135,000 orders. I estimate their average order value to be about $40 dollars. This gives them approximately $5.4M in revenue on their DTC channel for this time period.

How does this compare?

I have also been tracking S’well. Over the same time period, S’well processed 48,718 orders. I estimate their average order value to be about $35. This gives them approximately $1.7M in revenue on their DTC channel for this time period.

BruMate is processing almost 3x as many orders as S’well on their website.

Facebook Advertising

Currently, BruMate has 500 active ads on Facebook. The vast majority of these ads have photos for their creatives rather than videos.

See BruMate’s Facebook Ads

As a comparison, S’well only has 13 active ads on Facebook

See S’well’s Facebook Ads

Google Search Advertising

These are the top 5 Paid Keywords for BruMate:

  1. brumate
  2. rum punch
  3. sphere ice molds
  4. brumate coupon
  5. wine tumbler

I found the rum punch keyword to be fascinating as it is such a general term. BruMate has a blog titled: “The Best Rum Punch Recipes to Get Your Party Started“. This page serves as good content to get traffic to their website, only at the very bottom do they mention their BruMate products.

These are the top 5 paid Keywords for S’well:

  1. swell
  2. swell bottle
  3. swell water bottle
  4. swell water bottles
  5. s’well water bottle

It is common that a brand’s top keyword is their brand name, but it is nice to see with BruMate that they are able to drive traffic from non-branded keywords. It appears S’well does not try to compete on non-branded keywords.

Instagram

BruMate (@bru.mate) has 418K followers on Instagram. In the month of September, they posted 25 times. And in the past 7 days, they were tagged 92 times in posts. 

S’well (@swellbottle) has 272K followers on Instagram. In the month of September, they posted 14 times. And in the the past 7 days, they were tagged 50 times in posts.

Audience Demographics

BruMate:

S’Well:

Both brands have extremely similar audience demographics. 

Beyond DTC

The Trends article showed the revenue channels for BruMate, DTC, Amazon, and wholesale. It also mentioned they are doing about $100M+ in annual revenue. My best guess is they BruMate will do about $20M-25M through their DTC channel. That means Amazon and wholesale pick up the other $75M-$80M of yearly revenue.

S’well also has surpassed $100M in total annual revenue. My best guess is they will generate about $20M through their DTC channel. S’well has a large wholesale business, including a large promotional product/customization business. 

Both of these companies have done a great job building their brand. And once that brand was established, it opened up doors for wholesale and customization.

Start with DTC, build the brand, then expand to wholesale and partnerships.

Sunglass Wars Part III: Seasonality Is Here

Previous Sunglass Wars Articles:
Sunglass Wars: Blenders Eyewear vs Shady Rays
Sunglass Wars Part II: Blenders vs Shady Rays (August Update)

I have been following Blenders Eyewear and Shady Rays for the past three and a half months, and it appears in September, seasonality has officially set in. Here is the Google search volume for the term “sunglasses” over the past 4 years:

Every July, search volume peaks for sunglasses and bottoms out in October. And I am seeing the same trend with the revenue for Blenders Eyewear and Shady Rays:

In September, Blenders averaged 2,500 orders per day for an estimated revenue of $3.5M. This is down from August which they saw 3,500 orders per day for an estimated revenue of $4.9M and in July, 5,200 orders for an estimated revenue of about 7.3M

Shady Rays averaged just over 2,000 orders per day for an estimated revenue of about $2.8M in September. This is down from August which they saw just under 3,500 orders per day for an estimated revenue of $4.8M and in July, 6,000 orders per day for an estimated revenue of about $8.4M.

In July, Shady Rays outperformed Blenders, but Blenders has been out performing Shady Rays in August and September.

Instagram Stats

(note: Shady Rays follower count on the right axis)

Follower count growth has slowed for both companies (again, no surprise based on seasonality). Blenders now has 555K followers and Shady Rays has 126K followers.

Both companies posted on Instagram about 1 time per day during the month of September, however Blenders was tagged in posts almost 4x as much as Shady Rays.

TikTok and Reels

Blenders is making a little bit of an effort to utilize TikTok and Reels, while Shady Rays not made any efforts. It appears most platforms are trying to push more video content out (as it seems that’s what consumers want).

Blenders is averaging about 40K views on their Instagram Reels and about 1700 views on their TikTok videos.

I would like to see both of these brands try to create more content for these channels as they can be great for getting exposure for your brand.

Facebook Ads

Here is more confirmation that seasonality has hit. Blenders currently has 730 active ads on Facebook (in August, they had 870 ads, and in July, over 1600 ads).

Shady Rays has 110 active ads on Facebook (in August, they had 81 ads and in July 160 ads).

I obviously cannot see the ad spend for both of these companies but my guess is that it correlates with the number of active ads they have. Their peak spending was in July and have backed down since then.

See Blenders Eyewear Facebook Ads

See Shady Rays Facebook Ads

Top Paid Keywords

Here are the top paid keywords for both of these brands over the past 3 months:

I find it interesting that for both brands had “…for women” appear in their top 5 keywords this month. I really do not have an explanation for it, or even a guess but it was interesting that it occurred for both brands.

The Sunglasses War

After the first month, I had that Shady Rays is currently winning the war. However, after 3 months now, I believe that Blenders will win the war. That doesn’t mean I think that Shady Rays is going to zero, it means I think Blenders will outperform Shady Rays in the long run. I think Blenders has a stronger brand and they are better at showcasing that brand.

Blenders represents being outdoors by the beach (surfing, skateboarding, playing volleyball, or just hanging out). Shady Rays is about being outdoors, but where that is is not clearly defined and they have been all over the map with influencers they partner with (professional wrestler, Olympic gymnast, racecar driver, and more). I can not clearly define who a Shady Rays customer is, but I can clearly define who a Blenders Eyewear customer is.

I will continue to follow both of these brands to see if my opinions hold true. My bet is both of these brands will have another down month in October and then maybe a small bump for the holidays. We will not see significant monthly revenue growth until March 2022.

Pillow Slides Are Hot Right Now – A Breakdown of PillowSlides.com

You most likely have seen this product by now. You probably have seen them called “pillow slides” or “cloud slides”. Just a couple of days ago Good House Keeping had an article showcasing the top 10 best pillow slides.

Here is a graph showing the monthly search volume for the term “pillow slides” over the past 10 months:

As you can see, in November of last year, there was next to no search volume for this product. Then it quickly exploded to being searched 40,000 to 50,000 times a month. 

There are many sellers on Amazon for this product. However, a few have created a DTC (direct to consumer) brand for this product: Pillow Slides, Sootheez, and Cloud Slides.

You can find this exact product on Alibaba for about $2 per pair. The average selling price on these websites I have seen is about $30 per pair.

I took a look behind the curtain on Pillow Slides (www.pillowslides.com) business:

The Numbers

Between September 10th and September 29th, Pillow Slides received 2,720 orders. On average, that is 143 orders per day.

Pillow Slides is a single sku website. They only sell these sandals for about $30. They do have an upsell post-purchase to try to get you to purchase a second pair for a discounted price. Some may purchase more than one pair at a time, but my guess is 90% of their orders are for one pair.

With all that being said, I will use $30 as their average order size (yes some purchase more than one but they also ship out free orders for replacements and samples). 

143 orders per day with an average order size of about $30 gives them an average daily revenue of about $4,300. In September, I estimate they will generate about $125K of revenue (a yearly run rate of $1.5M).

Traffic

Similar Web estimates their monthly website traffic to be about 62,000 total monthly visits (their competitor Sootheez receives about 50,000 total monthly visits).

Paid Search

Here are the top 5 paid search terms for Pillow Slides:

  1. pillow sandals
  2. pillow slides slippers
  3. pillow slides
  4. pillow slides shoes
  5. pillow slide slippers amazon

Facebook Ads

Currently, Pillow Slides has 61 active ads on Facebook. However, they have not launched a new ad since April 2021.

See Pillow Slides Facebook Ads

Instagram

Pillow Slides has 50.5K followers on Instagram. In September, they posted 59 times and were tagged 82 times.

Here is their audience demographics:

TikTok

Pillow Slides only has 2K followers on TikTok; however, they advertise heavily on the platform. 

Here is one of their ads:

This ad has been used in multiple campaigns: 

 

7/16 Campaign – 29.1K views

7/18 Campaign – 1.1M views

7/23 Campaign – 244.3K views

7/27 Campaign – 107K views

8/24 Campaign – 334.2K views

9/6 Campaign – 276.9K views

 

They have also had other video ads do hundreds of thousands of views as well.

 

Post Purchase Email

 

5 Days after my first purchase I received this email:

 

Subject Line: “Your Refund is Waiting”

I found this to be an interesting way to incentivize people to share Pillow Slides and provide Pillow Slides user-generated content. You are sent to a simple JotForm to fill out and submit your images(s)

 

Ride The Wave While You Can

 

Pillow Slides are clearly hot right now. It reminds me a little bit of the weighted blanket wave of 2017/2018. Pillow Slides appears to have entered the game fairly early. As you can see, a ton of competition has entered the market. Having a yearly revenue run rate of $1.5M is not too bad; however, this will not last forever. My bet is they will see their market share erode over the next 6-12 months. They will either have to launch new products to the audience they currently have, or they will have to shut down this operation and move on to an entirely new product.

Can You Build A Meaningful Company Selling Products Dropshipped From Alibaba?

Anyone can go to Alibaba or CJ Dropshipping and sell an item dropshipped online. But can you actually make money doing this? You will see people on Youtube selling you courses on how to do it, but to me that’s the first red flag. My theory is if anyone is teaching you how to make money, why are they just not printing money with what they are teaching?

When you are selling the same exact product as someone else, you are most likely in a race to the bottom on price (see Amazon). But if you really think about it, what is the difference between a Casper Mattress and a Leesa Mattress, or a Nike running shoe and a Reebok running shoe, or a Titleist golf club and a TaylorMade golf club? It’s not much, and really it is just their brand that differentiates themselves. A lot of times these brands use the same manufacturers and just put their brand on the product that they sell.

I had a conversion with Marc Gutman (a branding expert) from WildStory again to ask him this question: Can you create a meaningful company dropshipping products from Alibaba? Here is our conversation:

We took a look at two examples that I have been following: FloppyFishy.com and TopTacticalgear.com. And for the second time, our conversation ended up drifting to golf and talking about our love for the Bad Birdie brand.

FloppyFishy.com

I have been following Floppy Fishy for a few months now. I first saw their ads on TikTok and was curious to see how much business they were doing (read my first write-up on them). 

You can find this exact product on Alibaba (see here). Depending on the quantity you purchase, you can buy these for between $.55 and $2.50 per unit. Floppy Fishy is selling these for $29.99 (with free shipping).

Floppy Fishy is processing 40-50 orders per day, approximately $1200-$1500 per day in revenue. I estimate FloppyFishy.com will generate about $500K in revenue this year. 

Is This Sustainable?

That’s not bad, but is it sustainable? As I highlighted before, anyone can go copy this model. Their TikTok ads are shot with an iPhone with some text overlay. Anyone can go source the same exact product and send traffic from TikTok to their website. Floppy Fishy has built no moat to their business. There is nothing special about what they do.

But could they change this by building a brand? Right now, Floppy Fishy is only looking for transactions. And most likely, when enough competition enters the market, their model will no longer work and they will move on to a new product with a similar model.

Creating a purpose beyond selling a product

Floppy Fishy could create a purpose beyond selling just a product. They could use this one product as a launching pad to accomplish their purpose. Maybe their purpose is for pet stimulation. Stimulating your pet’s mind can help them learn, lower stress, curb unwanted behavior, and keep your pet healthy. Floppy Fishy then could go source more products that are the best at stimulating your pet’s mind and become the go-to source for pet stimulation toys. 

TopTacticalGear.com

Top Tactical Gear is another example I found of a company selling a product that could be found on Alibaba. 60% of their sales come from the sale of Tactical Gloves. Similar type gloves can be found on Alibaba.

Top Tactical Gear goes a step beyond Floppy Fishy and does provide a purpose on their about us page:

“We created TopTacticalGear back in 2018 to help you prepare for some of life’s unpredictable challenges and opportunities, in whatever form they may present themselves.”

Top Tactical Gear extended their product offerings beyond just the gloves (Floppy Fishy has not extended beyond their single core product). They also sell Back Packs, Belts, Hats, Helmets, Pants, Watches, and more. All products that fall under their purpose of preparing you for life’s unpredictable challenges and opportunities.

Their Numbers

When I last took a look at Top Tactical Gear’s orders back in August, they were processing about 40 orders per day. In September, it looks like they are processing about 60 orders per day. I estimate their September revenue will be about $75K. Their August revenue was around $55k. 

Note: These numbers are down significantly year over year (August 2020: $134K, September 2020: $205K). 

Top Tactical Gear Branding

Top Tactical Gear has made some steps towards building a brand; however, I feel like most of it is still just surface level (lip service). They tell you what their purpose is; however they have not convinced me by showing me that is their purpose (This still seems to be a business that is more focused on getting transactions rather than building a valuable brand).

They have 18K followers on Instagram but I do not feel that there is a community that loves this brand. They have done a better job of taking a product from Alibaba and trying to differentiate themselves with branding than Floppy Fishy has but there is a lot more they could do if they focused more on brand building. 

Milking The Cow

I view companies like cows and the milk they produce as returns. You could try to maximize the amount of milk produced in the short term, but most likely, that will come at the detriment to the long-term value of that cow. You could try to find new cows to get milk from when the useful life of the first cow is done, or you could try not to maximize daily returns but focus on the long-term health of that cow and increase its chances of it producing milk for a long time.

Floppy Fishy is only focusing on transactions, and they will find that strategy will run dry fast. My bet is within 1 year; Floppy Fishy will no longer be in business. They will have to find a new cow to get milk from.

If you want to build the next Allbirds, or Chubbies, or Dr. Squatch you have to be more focused on the long-term health of the cow. Forgo some short-term returns so you can increase the overall value long-term.

This doesn’t mean you can’t start with selling a dropship product from Alibaba or CJ Dropshipping, but you will have to evolve beyond just selling a product online. Figure out what your purpose is, the customers you want to serve and how you can make their lives better.

$5M+ Monthly Sales From Building Demand Through Scarcity

Nugget Comfort is still on a 2 week backorder delay (this has improved from their 2-4 weeks delay earlier this year). I want to say despite this delay; however, I actually think it may be because of this delay, their sales continue to increase.

Nugget Comfort generated just over $4M in sales in June, which grew to $4.7m in July, and $5.5M in August. And still, I see no Facebook Ads or Google Ads for them. 

As I spoke about in other articles, Nugget Comfort has built up demand for its product. The fact that you cannot just go get their product makes you want it more. Back in 2020, they had a lottery for an opportunity to purchase one of their 60,000 units available. Over 200,000 people signed up for this lottery. For all of 2021, their products have been on backorder for 2-4 weeks.

My bet is if there were no backorder for their products, they would see an initial boost in sales, but over time, interest would die down. I do not know if they are intentionally keeping their items on backorder but it is a fascinating mindset the consumer is put in when a company is showing that demand is so high for their product. 

Barriers To Purchase

This is the opposite playbook from Amazon. Amazon wants to remove every barrier possible from the consumer making a purchase. But what if you do put a few barriers up for a consumer to get your product? Such as they have to be invited for the opportunity to purchase it? Or you must pay an initiation fee to gain access? Or you must wait a certain time period before you can get the product?

It is risky, as consumers may just go look for other similar products that do not have these barriers. But if you have a product that your consumer can not easily replace with a competitor, putting up artificial barriers can boost interest and long term sales for your product/brand (think of those long lines to get the new Apple iPhone, or when Nike drops a new shoe).

Instagram

Since the end of July, Nugget Comfort has grown their Instagram following by 2% to 427K followers. In July, Nugget posted 14 times. In August, they increased that to 21 times.

In July, Nugget was tagged 725 times. In August, they were tagged 1,034 times. It is too early to see if there is a correlation between their Instagram growth (and tags) and their sales. However, this is a trend I will continue to follow.

Email

In August, Nugget sent me 5 emails (they sent me 4 in July):

August 6th (11:11am): Argh, mateys! Tis time for a pirate Supernow-Nugget class

August 12th (10:01am): The More You Nugget

August 18th (2:45pm): Double the Double-Brushed Fun

August 19th (11:04am): Today is the day!

August 25th (12:19PM): Sandcastle is Back!

(click on the link to see the email)

FOMO

I stated it before in previous articles, but Nugget uses fear of missing out (Fomo) to drive sales. They often are releasing new colors, bringing back old colors, and retiring current colors. They give you limited opportunity to purchase the items.

On August 18th, they sent out an email alerting their customer base that they would be releasing two new colors the next day. On August 19th, just before the colors went live, they sent out another email saying the products would be available starting at Noon eastern. Highlighted right below that was a disclaimer: “Due to limited quantities…”.

Nugget has stayed consistent and trained their customer base that they do sell out, that they do retire colors. They do not just cry wolf. So when they say “limited quantities”, their customer base knows they must take action now or they truly may not have the ability to purchase that item if they wait. 

As you can see with their email on August 25th, they brought back the Sandcastle color (a color they previously had retired). This is a pattern that I see Nugget doing. Run a color for a certain period of time, retire that color, and then 6-12 months later, they bring that color back. 

Building Demand through scarcity

Nugget is a fascinating case study on building demand through scarcity. It is easy to get sucked into the trap of discounting products to generate more sales. However, this is a cheap way to generate sales and the tactic usually ends with the consumer always expecting discounts from you. So how can you generate sales without discounting? Generate demand through scarcity. 

How to Stand Out When Selling A Commodity (And Sell North of $100M)

The term “coffee” is searched 5 million times a month. If you are selling coffee, how do you get seen? How do you differentiate yourself? In the case of Black Rifle Coffee, it is not their coffee that makes them special or different. It is their branding.

I last took a look at Black Rifle Coffee at the end of July. For this check-in, I tried something a little different. I have been looking for domain experts to discuss these brands I am breaking down from their perspective. For this breakdown, I spoke with Marc Gutman from WildStory. Marc is an expert at storytelling and branding. Here is our discussion about Black Rifle Coffee:

Sales Update

I started tracking Black Rifle Coffee in July. I estimate they generated about $7.9M in revenue through their website. In August, I estimate they grew their revenue to $8.2M (about a 3% growth month over month).

Social Growth

Instagram followers have grown from 1.6M to 1.7M. In July, they were being tagged an average of 570 times per week. Currently, I see them being tagged about 646 times per week. They have an incredibly passionate audience, which is shown not only in their social numbers but also in their sales numbers. 

On Tiktok, they have grown their following from 370.8K followers to 380.2K followers.

Their Youtube audience has from 819K to 829K.

Advertising

On Facebook, Black Rifle Coffee currently has 120 active ads. In July, they had 300 active ads. 3 different brands I am tracking have drastically reduced their number of active ads from July to August on Facebook. 

21 of their ads were launched in August. In July, they had launched 77 ads (all of which are now inactive). 

See Black Rifle’s Facebook Ads

For search, the vast majority of Black Rifle’s traffic comes from its brand name. This is not terribly surprising because coffee is a commodity and the word coffee is search 5M times each month. To stand out, Black Rifle Coffee has had to build their traffic off of their brand, which means people search for their brand rather than trying to find them from a non-branded term.

You Need To Be Different, You Need To Stand Out

Black Rifle Coffee’s success can be directly attributed to its branding. Just from their eCommerce sales, they are generating around $100M in revenue. They have differentiated themselves, and they have stood out. If you look at any of the content they produce, almost none of it talks about how great their coffee is. It is all about building their brand image. And they can be polarizing, but that has been a good thing for this brand. It is good to have haters too.

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The Ultimate Guide To Starting A Golf Simulator Side Hustle

Winter is near for those in the northern hemisphere, and I wanted to give a complete guide to a side hustle that I ran for 3 years. This produced great cash flow for me during the winter months. 

Golf Simulator Business

If you remember, I wrote about the $300K Side Hustle I Started With $500 about a month ago. I was buying and selling pre-owned golf clubs. I eventually rented a warehouse to run that operation out of. The golf club reselling business is very seasonal and the winter months were slow. So, I had unused warehouse space during those months. I decided to fill that space with golf simulators and rent out the time. 

You can generate $25K-$30K of profit during the winter months from renting time to use these golf simulators. 

Here is the complete guide on how I did it:

The Simulator Setup:

This business model has become somewhat popular in areas that golf is not possible due to the cold or snow. However, most of these simulator businesses are wrapped into a bar or restaurant (and the build-out can cost $500k-$1M+). I built simulator bays in a warehouse without a giant build-out cost, so I was able to rent simulator time for half the price of my competitors. 

Each Bay Should Cost You $4k-$5k To Setup

I had a lot of trial and error, so to setup 3 bays it cost me about $20K, but you can learn from my mistakes and save yourself a lot of money.

You will need the following for each bay:

  • A Simulator/Launch Monitor Unit
  • Golf Course Simulator Software
  • Impact Screen (and a way to hang it)
  • Projector
  • Computer
  • Hitting Mat

Simulator/Launch Monitor

To start out, I opted to go with the SkyTrak unit as my simulator/launch monitor. There are pros and cons to this unit. It is the best bang for your dollar. However, it can be a little finicky and not the best user experience. I used the Skytrak units for 3 years before selling the business (the person that bought the business upgraded to overhead units that cost about $8k per unit).

You can get what you need from Skytrak for about $2K per simulator. You will need the game improvement package and I recommend getting the protective case.

https://www.skytrakgolf.com/skytrak-launch-monitors-packages

Golf Course Simulation Software:

SkyTrak has a few third-party apps that run golf course simulation. I opted to go with e6 Golf by TruGolf – http://www.skytrakgolf.com/simulation/trugolf

I have been very happy with this software (however, their customer service is not great). I have had other people in the industry say the same about this software. I bought the basic package for $299/year, which gave me 12-15 well-known golf courses (such as: Bethpage Black, Pinehurst #2, Harbor Town, Bay Hill, Torrey Pines, and more)

Projector

You must buy a short-throw projector. I did not realize that at first and purchased projectors that would not work for this setup. It must be a short-throw projector.

Ideally, you will hang the projector right above where the person is swinging (while this seems to be a dangerous spot, it turns out no one actually swings a golf club directly above their head).

The projector is mounted about 8-10 feet from the screen.

I found these projectors as an open box item on Amazon: https://www.amazon.com/gp/product/B00GGGQHHM/ref=od_aui_detailpages00?ie=UTF8&psc=1

I paid about $400/projector.

Impact Screen

Finding the right impact screen cost me a lot of money. I tried screens that cost $150 and I tried screens that cost $1,000. The best screen I found ended up costing me $350. The screen is essential because you project simulated video onto the screen, and players hit golf balls into the screen. So you need a crisp, clear image on the screen, and the screen must withstand the impact of a golf ball going 150mph into it. 

Here is the best screen I found: https://www.carlofet.com/shop/golf-impact-screens?aspect_ratio=16%3A10&screen_material=Preferred+Golf+Impact

Preferred Golf Impact is the material I purchased.

Hanging The Impact Screen

There are many ways to get creative here. I would say I did not find the best solution, but I found one that worked. The screen must be held relatively tight on the top, left, and right sides (the bottom hangs loose). I built a metal frame to hold the screen using EMT piping and Steel Conduit. 

EMT piping can be purchased at a HomeDepot or Lowes and I purchased the conduit here: https://www.memphisnet.net/category/golf-cages-build

The issue with using a metal frame is that if a golf ball hits the frame, it ricochets and can cause damage to the building or people in the bay. I padded the steel with a foam covering. However, this was not perfect.

Computer

You will need a computer to run the golf simulator software off of. Any computer will work but I recommend upgrading the graphics card for best results. The computer is hooked up to the projector, whatever is shown on the computer screen is duplicated through the projector and onto the impact screen.

All in you should be able to get a computer and graphics card for about $500.

Mat:

You will want a quality golf hitting mat. Cheap mats will tear up quickly and give a poor user experience. I purchased my mats from Reel Feel Golf Mats (http://www.realfeelgolfmats.com/). The golf mat should be big enough for someone to stand on and have the Skytrak unit sitting on the Mat (at least 4×6 but go bigger if you can).

The mats cost me about $450 each.

Simulator Bay Size:

Your ceiling height should be no lower than 10ft. This should give plenty of clearance for people’s golf swings. The room depth should be about 20 feet, and you will want it to be about 15 feet wide. This will allow multiple people to be in the bay at once safely with enough space to sit down and have one person swinging at a time.

The End Result

The Financials

Because I was just golf in a warehouse, I offered my hourly rental rates much lower than my competitors. I charged $30 per hour. And I was open 7 days a week from 8am – 8pm. 

Overall you should expect to have the bays utilized for 50% of the time you are open. Weekdays can be as low as 30% utilization and weekends can be about 90% utilization (as you get closer to spring, demand for the simulators will increase).

I ran 3 simulator bays from November – March (or whenever outdoor golf started again). Here is what I expect my monthly revenue numbers to be:

November – $12,000

December – $13,000

January – $15,000

February – $16,500

March – $18,500

For labor, you can choose to work it yourself or hire hourly employees. If you hire someone for $14/per and you have all the hours you are open covered, you are looking at paying about $6K per month in labor (including payroll taxes). 

I had my office at the same location. So during normal business hours (8am-5pm weekdays), I did not need to hire someone to cover those hours (but out of convenience, I usually had someone come in for some of those hours).

I paid about $2500 per month for the location I operated these at (rent plus utilities). The unit was about 2500 sqft (I paid about $12/sqft). I did have a year-long lease as I used the spot for other purposes in non-winter months. It may be tough to find a location that will let you rent for 5-6 months out of the year (but if you get creative and hustle, I bet you can find something that will work).

In all, I would expect to generate about $25K in profit each winter season off of these simulator bays. Initial setup costs are about $15K. So after year 1 you have your initial setup costs paid for plus you profited some money. All the equipment should last about 3 years, then you may have to replace a screen or replace a Skytrak unit.

How I Drove Business

Groupon: This gave me an easy way to get the word out that we existed. However, I had to discount the rates pretty significantly to sell on Groupon (essentially 50% off). What I found out though was that not all Groupons that you sell get used. So for all the cash I collected through Groupon sales and the number of Groupons that were redeemed, it was only as if I was discounting by 10% or so.

Note: I am no longer sure if Groupon gives you all the cash upfront, or they now wait for the Groupon to be redeemed. If they only give you the cash for what is redeemed, Groupon may not be a good option.

Google Ads: I put up a geo-targeted Google Ad for anyone that was searching for “Golf Simulators” or “Indoor Golf” in my area.

Gift Cards: I sold gift cards for Black Friday and The Holidays. This was a tremendous source of cash for me. I would sell the Gift Cards at a discount (buy $60 worth of time for $30). I would generate thousands of dollars of sales from this offer. And like Groupon, a lot of the gift cards would go unused. This was essentially an interest-free loan for me that boosted my cash flow.

Email Marketing: For anyone to book time on the simulator, they must provide an email address. It is incredibly important keep an email list and stay in contact with them. This list will help fill your time in year 2, 3, and beyond. Always be collecting emails and keeping in touch with them.

Additional Sources of Revenue

You will have a steady flow of people in and out of the business each day. This gives you an opportunity to sell other items to this audience. You can sell snacks and drinks, you can sell golf balls and gloves, and if you get a license, you can also sell alcohol.

We also offered golf club regripping and repair services. We setup an account with GolfWorks (golfworks.com), and could have almost anything shipped to us within 2 days. However, we did stock a good baseline of grips so that we could regrip a set of clubs same day.

Did this make me rich?

Absolutely not. However, if you have the ability to setup this type of operation, you can make some decent side money throughout the winter.

Let me know if anyone tries this!

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