Latest / The Growth Class with Phil Masiello / Premium Pet Nutrition: Building a Farm-to-Shelf Brand with Dewar Gaines

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Premium Pet Nutrition: Building a Farm-to-Shelf Brand with Dewar Gaines · The Growth Class with Phil Masiello

• 0:20
  SPEAKER_01: Hey everybody, and welcome back to the Growth Class.
• 0:23
  SPEAKER_01: I'm your host, Phil Mastiello, and on this show we love to look at the massive shifts happening in retail and e-commerce, and there's no industry seeing a bigger boom in the premium space right now than pet care.
• 0:35
  SPEAKER_01: Modern pet parents don't just want food for their dogs, they want clean, honest premium nutrition.
• 0:40
  SPEAKER_01: My guest today is right at the center of that movement.
• 0:42
  SPEAKER_01: I'm joined by Dewar, the driving force behind Gaines Family Farmstead.
• 0:46
  SPEAKER_01: Now, if you're a pet owner, you know how hard it is to find treats you actually trust.
• 0:50
  SPEAKER_01: Gaines Family Farmstead has completely disrupted the space by going back to basic basics, creating premium 100% natural, single and limited ingredient dog treats, starting with their insanely popular U.S.
• 1:02
  SPEAKER_01: grown sweet potato chews and bones.
• 1:04
  SPEAKER_01: But what makes the story fascinating from a growth perspective is how they managed to control their quality while scaling.
• 1:11
  SPEAKER_01: They didn't just outsource everything.
• 1:12
  SPEAKER_01: They built a farm to shelf story, their own local sourcing and food grade manufacturing.
• 1:17
  SPEAKER_01: So we're going to talk about scaling a family brand, navigating the hypercompetitive pet industry, what it takes to win on the retail shelves today.
• 1:25
  SPEAKER_01: Dewar, welcome to crunching your growth.
• 1:28
  SPEAKER_01: I appreciate it.
• 1:28
  SPEAKER_01: Appreciate it.
• 1:29
  SPEAKER_00: Be careful.
• 1:30
  SPEAKER_00: I'm going to have to have you on some of our live streams to do my introductions, man.
• 1:34
  SPEAKER_00: That was great.
• 1:39
  SPEAKER_00: Appreciate you having me on, man.
• 1:40
  SPEAKER_01: Yeah, my pleasure.
• 1:41
  SPEAKER_01: My pleasure.
• 1:42
  SPEAKER_01: Why don't you take us back, take us back to, you know, the impetus, like what drove you to do it, how you did it, why you did it, all that.
• 1:49
  SPEAKER_01: Absolutely.
• 1:50
  SPEAKER_00: So it actually goes back to my old dog Beam.
• 1:54
  SPEAKER_00: He was my, I got him in when I was a freshman in college.
• 1:57
  SPEAKER_00: Um, and he, I guess it was around 2014 or 2015, we lost him to a rawhide poisoning.
• 2:06
  SPEAKER_00: Uh yeah, it's crazy.
• 2:07
  SPEAKER_00: And like we're big dog people.
• 2:09
  SPEAKER_00: You know, we've always that my my dad's family raised dogs, bred dogs.
• 2:13
  SPEAKER_00: We've always had several dogs.
• 2:15
  SPEAKER_00: Uh, and when we lost him, it was like, what are we feeding?
• 2:20
  SPEAKER_00: It really kind of lit something in me.
• 2:22
  SPEAKER_00: So I really started paying close attention to the the health and wellness uh of the pets and like specifically looking at what we were feeding.
• 2:29
  SPEAKER_00: That was like 2014.
• 2:31
  SPEAKER_00: My background, I'm in branding and marketing.
• 2:33
  SPEAKER_00: So I worked in advertising agencies, and um so I had a customer that was in the pet space, and I really fell in love with the pet industry.
• 2:43
  SPEAKER_00: Uh, realized how difficult a time I was fine.
• 2:46
  SPEAKER_00: I I had to find really well-sourced, um, well-made products, single ingredient, high nutrient density, and decided that I would quit my very comfortable advertising career, much to my dad's chagrin.
• 3:02
  SPEAKER_00: I think he's okay with the decision now, but uh we I quit that job and decided to start hand making sweet potato dog treats.
• 3:11
  SPEAKER_00: Uh, about 60 days after I quit my job, I convinced my brother to quit his job.
• 3:16
  SPEAKER_00: Um, we we opened up a little 700 square foot garage where every morning we'd go to farmers markets, we would buy locally grown sweet potatoes, we'd take them back to the the uh warehouse, we'd hand slice them, literally like hand slicing a raw sweet potato.
• 3:31
  SPEAKER_00: I don't know if you've ever tried to cut a raw sweet potato before, but they're hard as a rock.
• 3:36
  SPEAKER_00: And then we'd make about 30 pounds.
• 3:38
  SPEAKER_00: We could make about 30 pounds a day if we cook 20 hours a day.
• 3:42
  SPEAKER_00: Uh, and then we'd go to farmers markets at night and dog parks and hustling little independent mom and pop shops.
• 3:48
  SPEAKER_00: Here we are.
• 3:49
  SPEAKER_00: Uh I quit my job in October of 2016 and we launched in February of 2017.
• 3:57
  SPEAKER_00: So we're now at almost 10 years.
• 3:59
  SPEAKER_00: Uh, we're an omnichannel business now.
• 4:01
  SPEAKER_00: We're sold in several thousand stores around the country, ranging from Fool's Corner Dog Store to uh we've done business with Costco.
• 4:09
  SPEAKER_00: We're sold on Amazon Chewy and really had a one of those grassroots Americana experiences.
• 4:15
  SPEAKER_01: Yeah.
• 4:16
  SPEAKER_01: Yeah, that's great.
• 4:17
  SPEAKER_01: I mean, I I'm a dog person and um I was fanatical.
• 4:23
  SPEAKER_01: I we just lost uh my oldest dog about a month ago.
• 4:28
  SPEAKER_01: Um he was a a Great Pyrenees uh mix a hound mix, and uh I was fanatical about what I fed him and and taking him to the vet and and trying to be proactive.
• 4:40
  SPEAKER_01: Uh and he wound up, you know, no matter what, he went you know he wound up getting cancer and just didn't make.
• 4:46
  SPEAKER_01: But he made, you know, we made it to 14 years.
• 4:48
  SPEAKER_00: But for a Great Pyrenees, that's a you must have been feeding him real well then.
• 4:53
  SPEAKER_01: I know.
• 4:54
  SPEAKER_01: I was trying to get him to 16.
• 4:55
  SPEAKER_01: I thought, you know, 16 would be a good one, but uh, you know, I get so attached that it was dev it, you know, it's devastating for me because it's not just I don't I don't look at my dogs as uh as pets or dogs, you know.
• 5:08
  SPEAKER_01: They're they're really like children, you know.
• 5:10
  SPEAKER_01: I take I PD I used to take everywhere.
• 5:12
  SPEAKER_01: I had a business and I had a warehouse and I had an offices.
• 5:16
  SPEAKER_01: And uh from the time he was like eight weeks when we got him until I mean through I used to take them to the office, I take them to the warehouse, took them everywhere.
• 5:24
  SPEAKER_01: I even got I went so far as to get uh uh what do you call it?
• 5:29
  SPEAKER_01: Um uh uh therapy dog tags or uh um service dog tags and uh so that I could take them.
• 5:36
  SPEAKER_01: I I literally could take the dog everywhere, and uh and I did, and people just used to laugh about it.
• 5:42
  SPEAKER_01: But um, you know, there I think dogs are fantastic.
• 5:46
  SPEAKER_01: I had on uh my show this guy Joe Rothley who founded Greenies, and uh he had a great statement.
• 5:56
  SPEAKER_01: He said, I can exist without a dog, but I can't live without a dog.
• 6:01
  SPEAKER_01: And I, you know, I think that's just uh a great way of looking at it.
• 6:05
  SPEAKER_00: And yeah, you said it and kind of one of my early thesis, uh or one of the founding theses is of the whole business is dogs are family now.
• 6:16
  SPEAKER_00: You know, there's the the dog that sleeps outside and eats table scraps.
• 6:20
  SPEAKER_00: I mean, I have friends, millennials are crazy about their dogs, they're having less children and more dogs.
• 6:26
  SPEAKER_00: And uh I have friends that are spending$200 a week on a dog uh just for their food and their nutrients.
• 6:31
  SPEAKER_00: So it's uh it's a really interesting market, and and dogs are family and it's continuing to grow.
• 6:37
  SPEAKER_00: The whole entire industry is continuing to grow, which is pretty remarkable.
• 6:41
  SPEAKER_01: Yeah, I think it's uh I think it's fantastic because you know you you people have started uh really focusing on what they're feeding their their dogs and their cats and and and that whole nutrition cycle.
• 6:53
  SPEAKER_01: Uh because, you know, before you had treats like milk bones and things like that.
• 6:58
  SPEAKER_01: And, you know, no, nothing against milk bones, but it's almost like giving your dog candy.
• 7:03
  SPEAKER_01: Uh so it's really not nutritionally significant.
• 7:06
  SPEAKER_01: But if you're gonna give them wheat, wheat candy, uh enriched wheat candy.
• 7:12
  SPEAKER_01: Well, you know, and it's it's um like we started, we never gave our dogs those kinds of things.
• 7:18
  SPEAKER_01: We looked for products like yours.
• 7:20
  SPEAKER_01: And I'm I'm I I looked at the package and I'm pretty sure that we've we've used them in the past because it was, you know, we're looking for something that um is a treat, but at the same time, it's not going to be a negative effect on their their health.
• 7:36
  SPEAKER_01: Like I gave my dogs, my dogs loved cooked broccoli, Brussels sprouts, green beans, things like that.
• 7:42
  SPEAKER_01: Um, so you know, and they like those for treats, but you just can't give them so much.
• 7:47
  SPEAKER_01: And then we would get others, and we were careful about the food we gave them and the w I, you know, here's a funny one.
• 7:54
  SPEAKER_01: And my kids will attest to this.
• 7:56
  SPEAKER_01: We moved into another house, and that house had a well.
• 7:59
  SPEAKER_01: And I am a city boy, I was born and raised in the Bronx.
• 8:02
  SPEAKER_01: I don't know anything about wells, but which it's got a septic tank and a well.
• 8:07
  SPEAKER_01: And I said, You mean to tell me that my water is coming from the same ground that the septic system is in?
• 8:14
  SPEAKER_01: And my wife is like, No, don't worry.
• 8:16
  SPEAKER_01: It's like I was like, that's not gonna fly.
• 8:18
  SPEAKER_01: So I had this this um filtering system put in for the well.
• 8:23
  SPEAKER_01: But then I went further and I put in, you know, this other filtering system just for water for the dogs.
• 8:32
  SPEAKER_01: Because I said, I'm not gonna give them, you know, crappy water.
• 8:35
  SPEAKER_01: And my kids were like, you don't care about us.
• 8:37
  SPEAKER_01: You got it's got a separate spigot.
• 8:39
  SPEAKER_01: This is just for the dogs.
• 8:40
  SPEAKER_01: You don't care about us, you care about the dogs.
• 8:43
  SPEAKER_01: I was like, Well, you can make your own decisions, the dogs can't.
• 8:49
  SPEAKER_00: There you go.
• 8:49
  SPEAKER_00: I mean, that's a perfect example, and uh uh it goes back to like the humanization of pet as a whole.
• 8:55
  SPEAKER_00: It's interesting.
• 8:56
  SPEAKER_00: Uh, I have a friend that's in the pet hydration category, so he is making like specialty waters for dogs.
• 9:03
  SPEAKER_00: It's like, bro, people, yeah, people are dogs are family.
• 9:08
  SPEAKER_00: I mean, it goes back to that foundational principle.
• 9:10
  SPEAKER_00: There's like these they're no longer the dog on the chain outside eating table scraps.
• 9:16
  SPEAKER_00: It's just not the not the case anymore.
• 9:18
  SPEAKER_01: No, thank God.
• 9:19
  SPEAKER_01: And uh no, you know, you got uh you you've got you've got people making, you know, uh memory foam beds for dogs, memory foam beds with heat or cooling, right?
• 9:31
  SPEAKER_01: Because my dog was a uh you know, a long-haired dog, didn't like the heat, it preferred the cool.
• 9:36
  SPEAKER_01: So you get them a bed that's got cooling, and you know, yeah, it's it's it's honestly uh it's just it I treat it mentally, it's just to me, it's like I treat it the same way I would treat a child.
• 9:48
  SPEAKER_01: I don't dogs don't talk back like children do and are always happy to see, you know.
• 9:53
  SPEAKER_00: I I get it.
• 9:56
  SPEAKER_01: Exactly.
• 9:57
  SPEAKER_01: They're always happy to see it.
• 9:59
  SPEAKER_01: They don't talk back, they do whatever you ask them to do.
• 10:01
  SPEAKER_01: You tell them go out and kill that chipmunk, they kill it.
• 10:06
  SPEAKER_01: So yeah.
• 10:07
  SPEAKER_01: Yeah, I mean, it's an interesting category.
• 10:10
  SPEAKER_01: So um, so yeah, how I mean, scaling this business, like you said, was sort of a grassroots you know, uh bootstrap type of thing.
• 10:20
  SPEAKER_01: Um, really, how did you do it?
• 10:22
  SPEAKER_01: Did you it it was it a plan or did you just go out and just hit it?
• 10:27
  SPEAKER_00: Yes, yes, yes.
• 10:29
  SPEAKER_00: Uh so the the if you if you look at line one of the business plan was build a brand and sell it in 10 years.
• 10:38
  SPEAKER_00: We are about to hit the 10th year and we're on a rocket ship right now, and it's like, okay, I've kind of got this figured out and I can see the next evolution of the business.
• 10:51
  SPEAKER_00: Uh, but there was some rocky years.
• 10:54
  SPEAKER_00: Uh so we started out with a manufacturing partner in South Alabama that was making fantastic product for us and willing to work with us on smaller order quantities.
• 11:07
  SPEAKER_00: They went out of bit, they the two brothers that owned it got in a fight.
• 11:10
  SPEAKER_00: They shut their business down.
• 11:12
  SPEAKER_00: Then my brother and I had to figure out how to hand make dog treats.
• 11:16
  SPEAKER_00: You know, we're just we were profitable in the first like 90 days of business until we had to figure out how to handmake treats and the chemistry behind it.
• 11:25
  SPEAKER_00: And um then got to a scale where it's like, okay, what are our core competencies?
• 11:31
  SPEAKER_00: And at the end of the day, I'm a marketer.
• 11:33
  SPEAKER_00: Uh I tell I tell folks all the time, we're a sales and marketing company with an incredible technology stack that happens to sell dog treats.
• 11:41
  SPEAKER_00: Um, and so we said, okay, principle here is we outsource everything.
• 11:46
  SPEAKER_00: We find the best manufacturers in the country, we find the best supply chains in the country, and we outsource all manufacturing.
• 11:54
  SPEAKER_00: Um, and that's what we've been doing successfully since 2000, late 2018 is when we really started outsourcing 100% of our production.
• 12:04
  SPEAKER_00: Uh, we now work with seven different factories, four in the United States, three, four abroad now, so eight different factories um all around the world.
• 12:16
  SPEAKER_00: Uh, we do 100% of our sourcing.
• 12:18
  SPEAKER_00: Uh we don't use any sort of intermediary to help source or manufacture any of our products.
• 12:25
  SPEAKER_00: So we know the farmers that are raising some of these crops.
• 12:29
  SPEAKER_00: We know the distributors that are selling the meats.
• 12:32
  SPEAKER_00: We know the guy that's that's that's uh supplying the turkey out of out of Ecuador for turkey tendon, I mean for turkey legs, you know.
• 12:39
  SPEAKER_00: Um, and then we know the manufacturers.
• 12:42
  SPEAKER_00: We we I can literally every single company that we work with is a family-owned operation.
• 12:47
  SPEAKER_00: I can pick up the phone and I can call the owner and I can hash out a problem.
• 12:52
  SPEAKER_00: Uh, and I think, so to go back to your question, I think foundationally that has been what has made us so successful at scaling is because we picked the right partnerships and we stuck very, very true to our foundational principles of like very high quality and an excellent supply chain.
• 13:12
  SPEAKER_00: And outside of just the normal hurdles of running a business, uh, we that that has really helped us.
• 13:18
  SPEAKER_00: Like I can pick up the phone and call a guy that raised 20 million ducks a year and say, hey, I need 50,000 duck heads in two weeks.
• 13:25
  SPEAKER_00: Can you make that happen?
• 13:26
  SPEAKER_00: You know, that's having those relationships.
• 13:30
  SPEAKER_00: And then what I've learned in the pet industry is this is all a relationship industry.
• 13:35
  SPEAKER_00: Um took five years for people to be like, okay, dealer's not going away.
• 13:39
  SPEAKER_00: Let's give them a shot for some business.
• 13:41
  SPEAKER_00: And then by year eight and nine, I'm like, damn, dealer has this thing figured out a little bit.
• 13:45
  SPEAKER_00: Let's let's give them more business.
• 13:47
  SPEAKER_00: And here we are, we're we're growing, we're doubling year over year right now, and it doesn't look like that's gonna slow down anymore.
• 13:54
  SPEAKER_01: Yeah.
• 13:55
  SPEAKER_01: I was on I was on uh a call with a guy the other night, and uh we were just talking about business, and I said, you know, people were entrepreneurs sometimes, uh, because I coach a lot of entrepreneurs about how to scale, and I said, you know, they always think about their product is the business.
• 14:14
  SPEAKER_01: But the product isn't the business, the systems are the business.
• 14:18
  SPEAKER_01: You don't scale the product, you scale the systems, and then you're the product just becomes what it is that's driving the system.
• 14:26
  SPEAKER_01: And uh, you know, it's a great conversation, but it's so true, and like what you said.
• 14:31
  SPEAKER_01: We're a sales and marketing company with a tech stack, and we just happen to sell dog treats.
• 14:35
  SPEAKER_01: If we took dog treats out of the equation, we could do it to sell almost anything.
• 14:40
  SPEAKER_00: So you said system, and and uh this is um this is a conversation that I've had many times.
• 14:48
  SPEAKER_00: I see our entire ecosystem as as uh as code, essentially.
• 14:55
  SPEAKER_00: Uh we have inputs and we have outputs.
• 14:58
  SPEAKER_00: We have customers that place purchase orders, and we have supply chains that have more purchase orders.
• 15:05
  SPEAKER_00: Adding new products a year ago we had 25 products.
• 15:09
  SPEAKER_00: A year and a half ago, we had 25 products.
• 15:11
  SPEAKER_00: We now have over 90.
• 15:13
  SPEAKER_00: Uh that will dip down and go back up.
• 15:15
  SPEAKER_00: I look at this as it is a system.
• 15:17
  SPEAKER_00: We have we have the software developer, the manufacturer that writes us a line of code, sends us product.
• 15:24
  SPEAKER_00: We have an internal system, an internal uh set of operations to bring that product in, recirculate that product, and ship it back out.
• 15:31
  SPEAKER_00: So we talk about this internally all the time, uh, that it it's just a systems uh of inputs and outputs.
• 15:38
  SPEAKER_00: Managing the relationships is is really the hard part, right?
• 15:42
  SPEAKER_00: The rest of it is order and ship, order and ship and systematizing that is um, especially when you're as omnichannel as we are.
• 15:51
  SPEAKER_00: Like if you look at you sell into seven different channels essentially, or seven different types of customers.
• 15:56
  SPEAKER_00: And so the systematic systemization of that uh has has been a big leg up for us and uh like ability to scale for sure.
• 16:07
  SPEAKER_01: What what are the seven different channels?
• 16:10
  SPEAKER_00: Yeah.
• 16:11
  SPEAKER_00: So we sell you sell direct to consumer.
• 16:15
  SPEAKER_00: Direct to consumer, but we have so I consider e-com, so our website is one channel, okay?
• 16:22
  SPEAKER_00: And then I consider live selling its own channel.
• 16:25
  SPEAKER_00: This is its own channel for us, so that's whatnot, TikTok, uh, talk shop live.
• 16:30
  SPEAKER_00: It is growing so fast, and we can talk about that more if you want to.
• 16:34
  SPEAKER_00: I consider that a channel.
• 16:36
  SPEAKER_00: We have direct to consume uh direct to retailer, so that's small independent retailers that are placing$200 to$400 orders.
• 16:44
  SPEAKER_00: We have direct to distribution, which is uh distributors placing orders from us and then them selling into retail.
• 16:53
  SPEAKER_00: We have uh a uh off brand, so that's TJ Maxx, Home Goods, Marshalls.
• 17:01
  SPEAKER_00: Uh, and then we have Amazon, which is its own channel in and of itself.
• 17:06
  SPEAKER_00: And then we have uh bulk big box, so that's the Costco's of the world.
• 17:11
  SPEAKER_01: Right.
• 17:11
  SPEAKER_01: I gotcha.
• 17:13
  SPEAKER_01: So you're looking at every I I got you.
• 17:15
  SPEAKER_01: You're just looking at every uh piece of it as a separate channel.
• 17:19
  SPEAKER_00: Well, and the reason and this is why I talk about the systems, is the reason it is is because each one of those has a specific need and demand.
• 17:29
  SPEAKER_00: Costco, they buy the truckload.
• 17:31
  SPEAKER_00: It's a different system that we have to follow.
• 17:33
  SPEAKER_00: TJ Maxx, different system.
• 17:36
  SPEAKER_00: It's easy to ship out, you know.
• 17:38
  SPEAKER_00: We we recently went from shipping 20 e-com packages a day to 250 packages a day.
• 17:47
  SPEAKER_00: That is a new system that we've had to develop entirely.
• 17:50
  SPEAKER_00: So we've we have to segment these really, really specifically, especially as we scale, because we're adding more and more people to the warehouse and uh more and more people to the team.
• 17:59
  SPEAKER_00: And so each channel has its own system within our overarching system.
• 18:04
  SPEAKER_01: Yeah, that makes sense.
• 18:05
  SPEAKER_01: I got I I I understand what you're saying.
• 18:07
  SPEAKER_01: Because we did the when I I founded a beauty business uh 20 years ago, 20, actually a little longer.
• 18:14
  SPEAKER_01: And uh we founded it on the shopping channels, which is HSN, and then we were in Canada, and then we were in Europe, and that's a very specific way of marketing and selling your product.
• 18:27
  SPEAKER_01: I thought it was great learning because it's very applicable today, which helps us to to guide people because you're you're essentially you know selling live via camera to um you know to customers telling a story uh to get them to buy that product.
• 18:44
  SPEAKER_01: And which, you know, it's sort of you know, we also did some stuff on DRTV, but that's a little bit different.
• 18:51
  SPEAKER_01: Uh but you know, I think it's very applicable today to like what you were talking about, talk shop and TikTok shop and all.
• 18:58
  SPEAKER_00: But listen, we're we're seeing it is so hard to create a seven-figure line of revenue in a consumer package goods business and in less than a year, whatnot alone.
• 19:15
  SPEAKER_00: One piece of the live selling channel is a seven-figure, you know, revenue stream for us.
• 19:21
  SPEAKER_00: Uh you get paid tomorrow.
• 19:22
  SPEAKER_00: And to your point, people crave the connection.
• 19:27
  SPEAKER_00: Uh AI is going to continue to deteriorate consumer trust.
• 19:31
  SPEAKER_00: I think we're gonna see a huge evolution of people wanting live engagement.
• 19:36
  SPEAKER_00: And there's I listen, I I can sit down here.
• 19:39
  SPEAKER_00: Last night I did it.
• 19:40
  SPEAKER_00: I sit sat down and we did fifteen hundred dollars in revenue in 60 minutes and had 30% of those of those purchasers were brand new customers.
• 19:48
  SPEAKER_00: But you did that on TikTok or you did that on uh whatnot.
• 19:51
  SPEAKER_00: We did that on whatnot.
• 19:54
  SPEAKER_00: Yep.
• 19:54
  SPEAKER_00: Whatnot is uh it's a machine.
• 19:58
  SPEAKER_00: I I say I scream it from the roofs.
• 20:00
  SPEAKER_00: Everyone needs to be paying very close attention to these live selling channels.
• 20:05
  SPEAKER_00: I 100%.
• 20:07
  SPEAKER_01: That's what's killing that you know, that's what's killing QVC and HSN or these live selling channels.
• 20:11
  SPEAKER_01: And I I agree with you 1,000%.
• 20:14
  SPEAKER_01: You know, these these people that are using AI and think AI is the salvation, and they're creating fake content, disingenuous content, so much so that the d that the um FTC has to step in and say you're gonna start getting fined for making fake content, fake UGC content, all that.
• 20:33
  SPEAKER_01: You're 100% right.
• 20:35
  SPEAKER_01: The consumer is looking for a connection to the brand.
• 20:37
  SPEAKER_01: They want to know who they're buying from.
• 20:39
  SPEAKER_01: So, you know, you I 100%.
• 20:41
  SPEAKER_01: Whatnot?
• 20:42
  SPEAKER_01: Absolutely.
• 20:43
  SPEAKER_00: Yeah, we we I believe this so fervently that I turned off all digital marketing in May of 2025.
• 20:51
  SPEAKER_00: So no more Meta, no more Google.
• 20:53
  SPEAKER_00: You spent over a million, it's a seven figure a year ad budget.
• 20:57
  SPEAKER_00: We turned it off 100%.
• 21:00
  SPEAKER_00: That's how much I believe.
• 21:01
  SPEAKER_00: And and also Meta and Google are raking people over the coals with their, I mean, customer acquisition cost has become absurd.
• 21:09
  SPEAKER_00: My customer acquisition cost is now relatable to time.
• 21:12
  SPEAKER_00: How much time can I get someone to sit behind this camera and stream to people all over the country to time equation as opposed to a cash allocation equation?
• 21:22
  SPEAKER_00: Customer acquisition cost goes down to how many minutes a show, how many new customers per show, what's the cost of that show?
• 21:30
  SPEAKER_00: It's absurd.
• 21:31
  SPEAKER_00: I I we speak in a whole new set of metrics in our office, and it's all revolving around this live shopping experience.
• 21:38
  SPEAKER_01: I I agree with you one 1000%.
• 21:42
  SPEAKER_01: I mean, like I said, we came up in in the shopping channels, and I loved that business because you are truly through that camera making a connection with the end user.
• 21:52
  SPEAKER_01: You know, they when we used to go down there, they would just obviously the the primary uh audience were female and they always to talk about she, you know, she's she's looking for this, she's looking for that.
• 22:03
  SPEAKER_01: And, you know, you get on there.
• 22:05
  SPEAKER_01: I wasn't on.
• 22:06
  SPEAKER_01: We had this woman, Carol Alt, she was a model, uh, supermodel and she was uh founder in the brand with us.
• 22:12
  SPEAKER_01: And she would get on there and just start talking and you could just watch you know you could just watch the metrics uh as as they explode and then you I'd go running out there with you know signs for saying hit this point again hit this point again because it it got the phones ringing and it got the the website going.
• 22:28
  SPEAKER_01: And so uh it was great.
• 22:30
  SPEAKER_01: And you know we do it now with we we we help a lot of our clients to make videos and to make and to get on some of these channels like you know talk shop tick tock and it's amazing to me um how many founders are afraid to make to get on camera.
• 22:49
  SPEAKER_01: They're afraid of it.
• 22:50
  SPEAKER_01: And I sit there going it doesn't matter like the more mistakes you make the more authentic you become you know and so you're you just so you said something that everyone needs to hear very clearly authenticity.
• 23:03
  SPEAKER_00: All right so I did probably 40 hours of streaming and finally one day my brother and I were in North Carolina and we had had a couple of beers and I was like hey dude let's do a stream let's do the stream like let's see if we can let's see I had the product with me we were on vacation and we turned it on and we did our first explicit show ever.
• 23:26
  SPEAKER_00: Well you know if we dropped a an F-bomb like it was part of the show it was and we exploded the number of viewers exploded.
• 23:36
  SPEAKER_00: We were being ourselves we turned off the sales we told our story no one can tell it better than us and now we're doing I mean the numbers are huge the numbers are are crazy.
• 23:47
  SPEAKER_00: We have a corporate partnership with whatnot now we're working with TikTok we're I think we'll do more revenue in live streaming next year than we did as an entire company last year.
• 23:58
  SPEAKER_00: Yeah that's how that's growing I couldn't I I couldn't agree more.
• 24:02
  SPEAKER_01: People are are especially especially the under 45 generation they they are looking for authenticity they're looking to connect and you know we try and get these we we have a we have a client who um makes a great unbelievable product unbelievable product I said you have to just get on there and talk about your product because so she she uh and she could tell us like if we were on a call like this right she could sit there and tell us all about it but the minute you put her live on a camera she throws up so what we started doing was we started doing it without telling her that we were doing it and we would just get on and say look we have to have a conference call here's what we have to talk about.
• 24:46
  SPEAKER_01: You know I just want to know from you because we're gonna do this and this and she's like okay you know she'd get on and she'd just start rambling about the product and then you know we'd get off and I'd say you know you just did Xatic co-op thank you.
• 24:59
  SPEAKER_01: You just did X hundreds of dollars worth of sales.
• 25:01
  SPEAKER_01: What are you talking about?
• 25:02
  SPEAKER_01: I said well we streamed it out onto TikTok and so like here's what happened.
• 25:06
  SPEAKER_01: It's like I said this is why you have to do it.
• 25:08
  SPEAKER_01: And then you know we put her through sort of a training one thing I learned about the shop you know in the shopping channels they had this training before you went on and we just sort of copied it and updated it and we started giving her some training and now she goes on all the time and she does it a couple of times a day for short intervals.
• 25:26
  SPEAKER_01: And I mean it's it's just it's phenomenal for her you know and and uh I it's just amazing to me how so few people people are afraid of that camera man.
• 25:36
  SPEAKER_01: They're just afraid of it.
• 25:38
  SPEAKER_00: Well and it also is a it's a it's a I mean when you enter CPG and you fit you're learning retail you don't just pick it up overnight it takes time to understand how all of these parts work and I I okay so here's how here's how much I believe in this last Sanford University uh we went and my cousin Chandler uh and I went and taught a sales and marketing class.
• 26:07
  SPEAKER_00: We brought our entire live stream setup to the class and we did live streams in front of these sales and marketing classes.
• 26:14
  SPEAKER_00: We just had our first three interns leave.
• 26:17
  SPEAKER_00: Did live streams of did live streams of selling your product or did live streams of the in their class selling on whatnot and we were doing big revenue and we were like look we're looking for three people I'm trying to do 30 hours a week of streaming.
• 26:32
  SPEAKER_01: I'll come teach you how to do this I we're ready for you immediately we had three guys come in they did all spring we have two girls in the warehouse now we're teaching another class uh at the beginning of the fall semester um they're starting to look at teaching classes around this um it's gonna be huge and I mean we just look at the look at what they're doing in in China I mean revenue like last night we were doing uh seven second sudden death auctions which means you have seven seconds to bid on it which means and this specific product and I I don't mind sharing it this specific product we make about five percent I mean five dollars net as long as it sells for eight dollars or more and we were selling every seven seconds for 15 minutes boom boom boom boom boom it's the best cash turn tool you get paid tomorrow you're creating content you're creating relevancy for AI it's I mean every aspect of it is so powerful I'm just sorry I've derailed us to talking about uh it's a it it's a great conversation I mean it's it's and you're 100% accurate and I love I love uh I I love video selling I I loved it when I fell in love with it back in the early 2000s when we were doing when we built a a beauty brand you know we did DRTV we did a whole bunch of different things we we try and you know I'm a big believer in in not doing static image ads I'm a I'm a big believer in trying to figure out how to get off of meta how to get off of Google because I agree with you meta to me is a piece you know I I have my own feelings about it.
• 28:14
  SPEAKER_01: I I'm not a big fan and I and I think that the whole platform is just destroyed by fake AI bots and just garbage that's on there now and people are spending money still any client that we have that does this we try and guide them into you know if you're not gonna if you don't want to do live stuff that's fine let's do connected television because that at least I can get I can control that as well and you you're gonna get a better return.
• 28:41
  SPEAKER_00: But you know spending money on meta ads and Google ads it's just like so uh last century I mean I'm with you man I'm with you so antiquated it is it's it's hey uh numbers are down meta's numbers are down this quarter let's just hike the customer acquisition costs across the board seven percent it'll make up the three percent deficit that we have like it's as easy as that you know like god yeah I'm done with it I'm done with it uh it's crazy I hear you well we ran over a little bit and that's okay um just give me how how can people get in touch with the where they can buy your product yeah where they can see you absolutely so you can find us on uh gains dot pet that's our website gains.pet um we're sold on Amazon on Chewy come check us out on whatnot we are the wildest show on whatnot if you click explicit it's gonna be a crazy show but uh it's I'm being dead serious we we love whatnot we're available on TikTok uh we have a couple of big announcements coming over the next uh in the next 60 days or so we'll be making some really big announcements so follow us online you can find us on Instagram all those places but uh find us on find us on the live streams because you're see we're we're doing so much cool stuff in pet right now and doing a lot of a lot of very very unique items that really are geared towards uh the health and wellness of of our our pet parent of our pets that's great man yeah thanks so much for having me on man yeah thanks for coming on and uh it was a I thought it was an office converse uh awesome conversation and uh yeah it's uh it it's great I wish you the best of luck and I'm gonna start tune tuning into your uh to your whatnot just to see what you're what you guys are doing.
• 30:36
  SPEAKER_00: We have an intern's first show ever at 2 p.m central standard time today I'm gonna hopefully listen to your first show this afternoon.
• 30:45
  SPEAKER_01: I'm gonna go in now that's a half an hour from now so all right man I will thanks I'll see you yes sir