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tv   Your Business  MSNBC  December 7, 2013 2:30am-3:01am PST

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they were a big hit online but decided to open a brick and mortar store to take their business to the next level. how eye glass entrepreneur saw clearly they needed to interact with customers. plus, he wants to rock'n'roll all night and make money every day. rock star and entrepreneur gene simmons on why you shouldn't listen to people to succeed in business. that's all coming up next on "your business."
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♪ ♪ hi there everyone. i'm jj ramberg. welcome to your business, the show dedicated to giving you tips and advice to help your small business grow. it's been three years since e-commerce optical brand launched and disrupted the world of prescription eyewear one click at a time. why are retail stores a part of their expansion plan? we head to their brand-new flagship store in the heart of soho in new york city to find out why this online business is also going off line.
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♪ >> when classmates kneel blumenthal, andrew hunt, jeffrey raider and david gill boa launched this site, it shook up the world of prescription eyewear, selling under the price of typical fashion glasses and doing it all online. >> we said what if we can create our own brand, design glasses ourselves, sell them directly to consumers through a user friendly website, we could offer the same quality glasses that cost $500, $600, but do so for $95. >> the idea quickly took off. >> we were featured in vogue and gq. we basically sold out of our inventory and had a waiting list of 20,000 customers. >> for two years they sold almost exclusively online. they didn't have stores in the business plan. their goal was to change an
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industry through internet sales. what they soon learned surprised them. >> what we found was that people really wanted to shop and experience the brand in person. >> they're not alone. internet retailers across industries are finding that while the internet is great to start an idea, ultimately there will always be consumers who want to do things the old-fashioned way, touch and feel them before putting down the plastic. e-commerce site piper line opened a soho, new york location in 2012 and mensa parl startup has six shops and at least two more in the works. other sites like bobble bar invested in pop-up stores in major cities. >> consumers will never going to do all their shopping on liechblt they're not going to do it all off line. the best brands that are focused on offering the best possible customer experience are going to have a presence in both channels. >> problem is, opening a store takes money and planning.
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in the beginning this was not the focus of warby parker. they did it on the fly inviting people to neal's apartment and laying frames out on the dining room table. today things are much different with a solid success story, thaech opened two brick and mortar stores with more on the way. the crown jewel, their 2,000 square foot flagship store on one of the most coveted blocks in new york city. >> we thought having a flagship store here in soho would strengthen the brand and add gravitas to it. it would help us perhaps reach customers that were reluctant to buy online. >> calling it a store does not do it justice. the two founders who are still running the company, neal and dave, decided if they were going to move into brick and mortar, they would do it in their own style. that's meant throwing some of the traditional thoughts of retail out the window.
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warby parker's short but vibrant history is front and center and coveted shelf space is given to showcase books from independent publisheser. >> traditional retailers walk in here and they're like, neal, you're crazy. what are you doing? you're wasting all this selling space. it's -- we don't look it on a square foot basis like that. it's sort of what is the experience that we want somebody to have and if we can have retail be a form of entertainment, if we can build community through this store, we think we're going to sell more and more glasses. >> a photo booth to share different looks with your friends, glasses out in the open instead of behind locked glass cases and a tablet checkout system instead of a traditional register setup are just some of ways their physical stores helps fans interact with the brand in ways they can't online. the stores have also helped the e-commerce site each a new customer base of shoppers reluctant to buy glasses on the
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internet. >> we're finding once they buy the first pair of glasses from the show rooms, the second, third or fout time they're doing so online. once we've established that trust, once people are familiar with the experience, they're much more likely to repurchase online. >> interacting with people at the stores also means they have a better pulse on what the customers wants. >> we're looking at sales data to help influence design online. but it's less forward thinking and here we'll see people come in and maybe they're look a cat eye or a particular style. that gives us the confidence to push the envelope more. >> would this store have been as successful if you started a store or skipped online or launched them simultaneously? >> that's a good question. we would have to do a big launch to have lines out the door and
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over 4,000 people each weekend for it to have worked as it has now. i think launching online allowed us to get a large following, much faster than if we had bricks and mortar because you're limited by geography. >> so far it's been a big success, exceeding all of their expectations. >> is demand what you expected or more. >> it's about double what we expected. >> why? >> we're hiring if you're looking for a job. go to warby that was a really interesting piece to do, particularly because those warby parker founders are truly forward thinking. so how can you apply some of their learnings to your business? let's turn to the board of directors. chris fray lick invested in
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warby parker and this is the ceo of the gold group. great to see both of you. >> great to be here. >> chris, we were talking about how gorgeous that store is. they did a really nice job with that. >> it is. i got to visit it for the first time last weekend. it was beautiful, it was packed. it felt more like an apple store than an eye glass store. like an apple store, instead of a genius bar, they have an eye exam bar. you can get your eyes checked right there. >> i want to talk about two different topics. the first is about retail in general and how they're rethinking the idea of retail. that it's not you're going into buy something. it is an experience. how important is that? >> well, i would have to say app am really changed the current state of retail and what can be done and what's possible. i think that warby parker very much fits into that theme with their own brand and their own twist on it. >> so jay, for anyone with a brick and mortar retail store, do they need to think of themselves as a destination, as
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entertainment? >> there's no question that it's a powerful combination to have both retail and online. but i have to warn people, when you look at the apple store, there's one big difference. apple is not giving their products away. i mean, the prices at apple are certainly not discounted. they give great service, the product is great, price, quality, service, pick too out of the three. that's an old adage. when you don't see the accounting for a company, it's difficult to analyze are they successful or just busy. if you have a business and looking to get sgo into a store, you need to understand it's not the cost of the rent, it's the rent, the employees, the health insurance, the management. there's a lot of buried costs that are the reason why markups are what they are. >> it is interesting, though. in the piece we mentioned a bunch of other stores that have now -- they're testing at least brick and mortar stores, online retailers. we did a story a few months ago about a company called story here in new york. it's a retail space that has a
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lot of products from different companies. bauble bar was one of the people, one of the stores that was testing having products in a brick and mortar store. they wanted to see how customers reacted to their products. do you think, jay, that ultimate ultimately, to be really big and successful, you need a brick and mortar presence? >> i think at the end of the day, it started out we had retail stores and then e-commerce. most of the retail stores are doing e-commerce and have sophisticated sites and now the e-commerce people are figuring out to compete, they probably will need in a lot of cases a brick and mortar store because a lot of the population want to touch and feel and experience the product. there's no question that the package of having both a great website and a great store is going to be, i believe, who is going to be the leading retailers and competitors out there. >> it seems, chris, that warby parker did it right. they tested it online without putting the big capital investment in the store. >> they did. the broader trend is online and
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off line are smashing together. the differences are blurring more and more. to jay's point, i think every off line retailer has to have an online presence, even if just for marketing and outreach. not every online retailer should go off line. but some can. i think warby parker is a perfect example of one that had built a brand out of nothing. i think that's part of -- you have to stop and pause and look at warby parker. they've sold 500,000 pairs of glasses and given away 500,000 in their buy one give one to people in the third world country who need one. but they've built this brand up from nothing and figured out how to do enough online/off line to ship customers five frames to your home to try on for free in order to make a purchase decision. >> the idea is basically they built a big brand. >> they built the brand first. >> proved they were successful. >> they've got momentum that people want to see 100 different frames at once in a cool
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environment. >> it's such a neat company and done such a good job. chris and yea, thanks for talking about this with me. stick around, we need you later in the show. >> sure. no matter how informative or entertaining your youtube video is, content alone will not guarantee you an audience of potential customers. smart marketing is key. here now are five of the most successful tactics for promoting a new youtube video courtesy of >> one, promote on your company blog. chock up each video in a post. tell your e-mail list. when you upload new content, send a message. three, connect to social media. facebook lets you embed videos in your status updates and on pinterest, you can pin them to virtual pin boards. also, promote your videos on social bookmarking and news sites like red it and stumble upon. four, do some old-fashioned public relations. issue a press release when you've uploaded a particularly
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important video and also pick up your phone to give your industry's trade groups, publications and blogs a heads-up. >> five, if you can afford it, advertise your videos on youtube. they're called true view ads and they'll appear on the site targeting potential viewers and linking back to the selected video or your youtube channel page. want to extend the reach of your next small business event, check out our website of the week. yapp is a free tool to let you create and -- own apps. select from a set of themes and features to design a mogul experience for your guests. add map links, share photos and send push notifications through your app. one of the worst things about working remotely is that people around you can hear your phone calls and see your computer screen. in fact, often the worst privacy violations start with you. so here now with tips to make sure you safeguard your
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company's secrets when working while out and about is carol roth. she's an old friend much this show and now a cnbc contributor. carol is also a best selling author. great to see you, carol. >> long time friend. not an old friend. jj. >> a long time friend. i find myself sitting in a coffee shop and realizing i'm talking too loud, i don't want people to see this. >> the coffee shop is the worst enemy of the entrepreneur. think about the setting. it is so chill and relaxing, you and i might be sitting and having our discussion but guess what, everyone else around is listening. if you have anyone like me who is incredibly nosy, they're listening and perhaps looking over your shoulder and at your notes. as an entrepreneur, you don't want to conduct any confidential meetings or have confidential information in a coffee shop, in a hotel lobby. you want to look for places like co-working spaces, business lounges, places that offer
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flexible work space. there are so many options that are really affordable it may seem like i can't afford to do that, that's why i'm going to the coffee shop. >> you can find something. what's a privacy aid, get a privacy aid? >> privacy shields, this is perfect for people who are sitting next to me on an airplane, on a train because i am -- i'm the nosest person around. i had a guy from the a car company next to me the other day. i know everything he's doing. >> we're the same. i cannot help it either. >> so they have devices called privacy shields. it's a piece of kind of plastic that you can get and put it on your laptop or tablet. you can put it on your smartphone. that means only you can see it when you're looking in front much it. you and i will -- no one else can see it. it's a really good tool to protect your privacy. especially we're all mobile and out and about, make sure to have one of those.
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>> and a shredder. which is not expensive at all. >> no. you have to shred your documents. the simple things like throwing away a presentation in your hotel room or at a coffee shop or a restaurant or as the guy did a couple weeks ago who left it in the seat pocket in front of me from a major pharmaceutical company that i now have in my possession. i'm telling you, you have to guard your documents. uts so easy to bring those back with you, take the time to put it through the shredder and make sure that any confidential information goes away. >> by the way, even if you don't have a shredder, rip it up. >> i take my documents if i don't have the shredder handy and i put it in different pieces and walk around to different trash cans. >> i do the same thing. >> we are the same person. elevators, the same as coffee shops? >> it's worse than an elevator. because most of people in the elevator with you know you and have the context of what's going on. in your office building or
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neighbors. you may think you're being slick and using a coded word, but they know what's going on if you mention that client that we just talked to. they're in the same building. they can figure it out. a lot of times you're coming from a meeting and engaged in the dialog and you're carrying on that conversation and you're in that enclosed space. a lot of confidential information gets transmitted that way. >> especially in an office where everyone likes to talk and gossip. >> there are entire twitter streams dedicated to the gossip that comes from elevators. they've got one, the gs elevator from goldman sachs and cnbc has a digital series where puppets reenact what was said in the elevator. if you don't want that to happen, you should not say that in elevators. finally, code names. >> so this comes back from my investment banking days. when you had an important client that you were working with or a piece of confidential information that you come up with a code name. project maximus or the redhead, whatever it is. it's like you're a spy, an
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entrepreneurial spy, if you will. if you're having conversations on your mobile phone, out in the open, use the code name so that it's not clear who you're talking about. really, really simple thing that you can do to protect your privacy and your client's privacy. >> you know what's great about these carol, they're so easy to do. it simply takes being mindful. thank you for reminding us. >> great to see you. still to come, how do you mass produce your product and not give up on the quality? plus, how much is too much when it comes to what information you sharon social media? and some heavy duty business advice from heavy metal icon and entrepreneur gene simmons in this week's learning from the pros. ♪
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it's time for the entrepreneur of the week. he used to sell tie dye shirts. opened aid factory in guatemala to keep costs down. now that fak fri is closed and cass is making more money by giving up most of those big deals. watch it sunday mornings at 7:po on ms. nx. msnbc. s. nx. msnbc. . nx. msnbc. nx. msnbc. nx. msnbc. . msnbc. msnbc. msnbc. msnbc. watch it suno on msnbc. deals. watch it sunday mornings at 7:po on msnbc. gene simmons is best known as the flame-spewing, tongue wagging demon-based bass player for the rock band "kiss." what you may not know is this i am grant came to the country with a burning desire to succeed in entertainment and business. a master marketer and entrepreneur, he recently opened
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the third location of his restaurant franchise. we caught up with him and sat down in his home to talk about his business philosophies in this rocking edition of learning from the pros. i want to rock and roll all night ♪ you can't do everything yourself. partnership is wonderful. partner up with people who know more than you do about things that you don't know anything about. you can't know everything. it's difficult to kick the goal, the ball into the goalpost by yourself. you need a good team. this whole idea that everybody's opinion is worth the same is patent lip untrue. there are qualified assessments and unqualified assessments. somebody can walk up and say you suck, your band sucks. that's fine.
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that's one. but i got ten million others who like it. like it enough to pay for it. so which do i listen to? you'll have an inferred fiduciary duty to yourself to be educated, be able to understand the big picture and understand the structure of capitalism, how it works. the cost of goods. i just have a passion. that means nothing. the most powerful and the most highly positioned people can have the same information i can have. i wasn't born in america. when i came to america, a few blocks down was a library and it was free. i could go in there and learn all the secrets of how to do everything and anything. it's your fault if you don't succe succeed. you cannot fail in america. never be the first one to do anything. you'll be the poorest guy in the room. don't be the first groundbreaker. it won't happen.
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let somebody else do market research and create a marketplace for you and just walk in and do it. in business, it doesn't matter if it's expected or not. this should be a surprise, it's original. no, who cares? either it works or it doesn't. whether it's expected or unexpected. there's just success and failure. and everything else is just smoke and mirrors. who and what we are, our people skills, language skills is the beginning and end of all of it. the resumes follow us. nobody reads anything. that's why headlines in newspapers were invented. figure out what your headline is right away. say it as succinctly as possible. whatever it is that you sell is where you sell it. location, location, location. then you've got to have the right thing at the right time.
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ideas are worthless, ideas mean nothing. ideas are a dime a dozen. what means most is implementation. the ability to do something and if you can actually make something work and if you understand the process, then you can fill in all kinds much things in there, whether it's your ideas or not. so my philosophy is, america is the blessed place on planet earth to make a lot of money in and i do. so do good stuff, make a lot of money, never have enough. there's only forward. you know, life should be like space. endless. endlessly dreaming and do good for other people and give back. ♪ it's time to answer some of your business questions. chris and jay are with us once again. this first one is about setting goals and achieving them.
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>> what are the four most important things a business owner should focus on if they're really going to be their best and achieve their optimal results? >> all right, jay. can you narrow it down to four? >> absolutely. the problem, the reason why the failure rate is so high for businesses, there's three piece toss t there's marketing, management and finance. most people are really, really good at one and pretty good at a second and throw up their hands-on the third. frequently, i hear when i do speeches, i hear i'm not a numbers person. you can't afford not to watch the numbers. the three i would say right off are marketing, understand who your customers are and how you get to them, two would be management, understand how to hire, who to hire, how to manage. and three, understand the finances. you have to have a budget and figure out hugh you're going to make money. the fourth one is simply understanding the competitive environment and where your niche is. >> anything to add, chris? >> i'd probably share -- say them differently.
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the first three. one is hire great people. number two is don't run out of money. good advice. >> key. >> i think really focusing on the customer, obsessing on the customers, asking what problem are you solving for them is really good. then maybe one, a broader one is i see -- suggest people let go of their fear of failure a bit. there's always a chance that will happen. too often i see start-ups trying not to fail versus really playing to win. i'd recommend they try and do that. >> big risk, big reward. let's move on to the next question. it's about quality versus quantity. >> as a fashion retailer that specializes in handmade products, how do you prepare yourself for mass production for future use without losing the handmade quality? >> it's a good question. shuds should she even look at mass production? >> it's a hard thing to say how
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do you make handmade in mass production? it's kind much two different things. i would think about what are you trying to solve for in the business, is it increased revenue or growth and are there other ways you might be able to do that with -- higher end handmade products, better distribution, higher prices versus just trying to increase the quantity or lower your cost. >> jay, any ideas for him? >> i would say the key thing is you cannot be everything to everybody. if you're going high end handmade, you're going for the top part of the market. you go for that. mass market is another animal. somewhere in between. you really need to figure out what's the best niche for you and what are you most capable of and what -- who are your customers. there are very few companies in this world other than people who sell toothpaste or something that sell to the spectrum from price all the way up to the highest quality. you really need to figure out what your unique selling proposition is. >> you guys keep coming back to in idea of understand who your
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customer is and then sell to them. finally, let's get to the last question. it's about setting boundaries on social media. >> when it comes to social marketing and there's this real big push for facebook and twitter, can you ever be too personal? i think a lot of times we reveal a lot of information about our business or personal information about us but can that bite you in the butt down the line? >> i think jay, the easy answer to that is yes, you can be too personal. >> absolutely. it gets down to branding. i once went on someone's website. she was -- she had a salon and did a thing about her background and talked about how she used to be a fortune teller. i don't know that that's helping sell the services she's now selling. while it was honest and personal, i don't know that it was going to help her mission of being a top notch salon. >> there's so much talk about being authentic and being yourself, you could see a fuzzy line between what should i be
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revealing. >> the broader question is you're a small business or a large one, you have hundreds or thousands of more fans or followers. you have to find the right balance. sometimes people can be too personal talking about being a fortune teller. sometimes it's like you're reading press releases. buy this, buy this. find that balance between the two and i think a good way is to really focus on what is your audience talking about. there are other ways too engage and build a conversation with them. >> chris, jay, appreciate you guys giving advice. thank you. >> thanks for joining me today. i hope you learned a thing or two. click on open business for more information. you'll find all of today's segments plus web exclusive con tentd with more information to help your business grow. you can also follow us on twitter, it's msnbc your biz and
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don't forget to become a fan of the show on facebook. next week, one entrepreneur says don't believe everything you hear. small businesses can compete on price. >> everybody in the industry always talks about service, service, service. but really the underlying theme for most consumers is really pricing. >> we'll tell you how the owner of a hardware store keeps his prices competitive and is turning a profit while being independently owned. until then, i'm jj ram berpg. remember, we make your business our business. time for the entrepreneur of the week. he hoped a factory in guatemala
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to keep costs down. now that factory is closed and cass is making more money by giving up most of those big deals. for more, watch your business sunday mornings at 7:30 on msnbc. i promised you the president of the united states and he's here. let's play "hardball." ♪ >> it's my honor to introduce the president of the united states. >> well, thank you, mr.


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