Welcome to Getting Granular
The podcast where digital marketing experts from the agency Granular talk about the latest trends, tried and true best practices, and share their unfiltered thoughts about the digital marketing industry.
Leadership Series: Hooga / Forever Lazy, Dave Hibler
In this episode, Steve Kroll is joined by Dave Hibler, the Co-founder of Forever Lazy and Hooga. Not all businesses started in parents’ basements get picked up by Fergie and catapult to success, but Dave’s did. Tune in and hear his story.
What you’ll learn in this episode of Getting Granular:
- Why Dave started Forever Lazy (2:15)
- How Fergie got a hold of a Forever Lazy Onesie (8:25)
- The progress of his businesses over the last 11+ years (10:37)
- Hooga’s background and how it was founded (16:55)
- What led Dave to seek an agency partner (21:14)
- Why he chose Granular (26:06)
- The key to successful client relationships and partnerships (29:25)
- His philosophy going into 2021/2022 (35:05)
- COVID-19 impact on his businesses and outlook on 2021 and beyond (42:00)
- Challenges with implementing a chatbot (14:33)
- Creative idea chatbots in action (21:40)
Steve: Dave Hibler and his co-founder started not one but two very successful e-commerce companies. The one we’re going to be focusing on in today’s conversation is Hooga Health. Hooga’s a Wisconsin-based company that specializes in the sale of red light therapy products. You’re going to learn how just in a couple years Hooga became a well known brand and major player in the red light therapy space, especially once they started partnering with Granular. And some of their products are now the top selling products on Amazon when you go to look for products like red light therapy and book lights. Granular’s had the pleasure of helping Dave and his team go from zero to one. They came to us and they needed to get Google Ads, search shopping, Bing ads, Facebook ads, YouTube ads, they needed to get that set up from scratch in the US and Canada and make sure they could capitalize on the busy Q4 season in 2020, and we had major success with that.
Steve: The great thing is, Hooga’s actually the second successful company Dave and his team’s starter after launching Forever Lazy, which is an adult onesie pajama company. That company now sells hundreds of thousands of those onesie pajamas each year, and it plays a pivotal role in understanding the success they’ve had with Hooga. We’re going to cover everything from how they got started, the pivotal role Fergie and the Black Eyed Peas played in their success, and Dave’s going to share his advice for other e-commerce founders wondering how to balance doing things in-house versus partnering with a group like Granular. Hope you enjoy today’s conversation.
Narrator: Welcome to Getting Granular, the podcast where digital marketing experts from the agency Granular talk about the latest trends, tried and true best practices, and share their unfiltered thoughts about the industry. Whether you’re here to learn how to grow your business, improve your digital skills, or just want to hear some Midwest PPC experts rant about digital media, you’ve come to the right place.
Steve: Steve Kroll from Granular here. Today I’m joined by Dave Hibler, co-founder of Hooga, as well as another company Forever Lazy. Really interested to talk to Dave just to get more background on Hooga, their business, and then just also learn more about Dave and how he got into the business. Dave, thanks for coming on.
Dave: Yeah thanks for having me. I’m excited to talk with you today.
Steve: Yeah, I’m pumped. So we’re going to get into all the great work we do together with you guys and your business, but I was just hoping you could start by introducing yourself and if you don’t mind just giving some background on what got you into running your own businesses and Hooga.
Dave: Sure. Absolutely. I’ll go back pretty far, because the story starts in childhood. So my best friend and business partner Tyler Galganski, him and I have known each other since we were two years old. We lived across the street from each other longer than that, but we’ve always determined at what age do you really know somebody? We’ve been neighbors since we were one, we’re like, “Eh, okay. Two years old. We’ve been best friends since we were two years old.” So we’ve always been trying to start businesses together, and selling American flag pins at the local fairs and so forth, and knocking door to door collecting cans. So we’ve always had this entrepreneurial spirit ever since a very young age. And we always knew we wanted to eventually run our own business one day. And the typical go to school, work hard, get a degree, climb the corporate ladder, that just didn’t really appeal to us. So it was just, we always knew we wanted to do something professionally, we just didn’t know what it was going to be.
Dave: So, Christmas 2008 I was sitting around with my cousin. We were having a few beers after Christmas dinner, and we were reminiscing about the one piece pajamas that we wore as kids. And “Jeez, I wonder if anybody makes that for adults. How great would that be?” So he got on his Blackberry. I got on my version one iPhone, and three hours later we had a website pulled up and we ordered some adult onesies. And the story could’ve just ended there had they been a decent pair of adult onesies. But we got them, we wore them, we exchange notes and we’re like, “These onesies are terrible man. Somebody could do this better.”
Dave: So we joked about it, and Tyler I had ended up telling him about it and he ordered a pair, which I later found out actually… He only just told me this recently. He actually never ordered a pair of adult onesies.
Steve: Oh no.
Dave: I know. It’s terrible. So I’ve been telling this lie that I didn’t even know I was telling for the last decade, and finally he corrected me. He was like, “No I just heard how excited you were about it so I told you I ordered one.” Anyway, so I told him all the things that I thought we could improve upon with these adult onesies. And we got on the internet. Tyler found a domestic manufacturer on Google, and we ended up flying out to San Francisco. We met with this 80-year-old garment industry veteran named Seymour, and Seymour and his team helped us to design the prototype for Forever Lazy. And then I mean pretty much right then and there, as soon as the prototypes came through, we both just quit our jobs, albeit admittedly it was very prematurely. We should not have done that, but we were just very excited and we quit our jobs and launched Forever Lazy. That’s the genesis of Forever Lazy right there.
Steve: Cool, yeah. I actually didn’t know that. And maybe touch a bit, because I know we’re going to get to what you guys are doing with Hooga Health, but Forever Lazy you guys got a lot of earned media and PR and things like that with that business. Maybe just touch on that business and progression and what you learned there that enabled you to have success with launching another business in Hooga.
Dave: Yeah for sure. Definitely lots of lessons learned, and I couldn’t even tell somebody the Hooga story without giving background on Forever Lazy, just because there was such a foundation there. So when we launched our Forever Lazy website, we paid a couple guys from our hometown three grand to put it together, and we never even crossed our mind about marketing. We just thought, “You put a website on the internet and people find it, right?” I remember the weekend we launched, it was the end of August 2009, and I was invited to a bachelor party the night before our launch, and I was like, “Dude I don’t know if I can make it. The website’s going live tomorrow. We could just be swarmed with orders and just backlogged.” We didn’t know any better. We had no clue.
Dave: So in reality, the website launched and nobody ordered a thing. And the next day, nobody ordered anything. And the day after that we got an order, and it was from my mom because she knew how down on ourselves we were. So after a few more days like this, and we had already quit our jobs and people started rolling their eyes at us when we told them why were quitting our jobs to sell adult onesies. Nobody thought we were going to make it, and for that reason we really, really had to make it work because nobody wanted to go back to their old job with their tails between their legs and say it didn’t happen.
Dave: So we ended up learning about Google Ad words, and pay-per-click, and that’s where we zeroed in. So, at this point we had no money. All of our money was tied up in our first run of 600 pairs of pajamas, our website, everything else. We couldn’t hire anybody. We had to figure this out ourselves. So over the next couple months, all we did is we sat there in my parents’ basement, because that’s like any typical startup story. That’s where we started, in a basement. So we sat there in my parents’ basement day after day, night after night, learning Google Ad Words. And we started launching some campaigns, and eventually we started getting some sales. We weren’t very profitable, but we at least were breaking even on the advertising, and we were getting the word out there.
Dave: So that was really our first foray into pay-per-click and digital marketing, which it was really a baptism by fire. So then from there, we put out some press releases. One of the press releases was picked up by a Hollywood gifting company. You know those swag bags that the stars get at the Oscars and Golden Globes and all that?
Steve: Mm-hmm (affirmative)
Dave: So yeah, so we were asked to give our product for these swag bags. Well, we thought “Great opportunity. It’s going to a bunch of A-List celebrities.” Fergie from the Black Eyed Peas, Paris Hilton, Oprah, J-Lo, Justin Timberlake, all the big names. So we did it, and because of that Fergie and the Black Eyed Peas… Well Fergie loved it. Fergie and her husband Josh Duhamel just absolutely loved our onesies.
Steve: Oh dang.
Dave: Yeah. So that was our big break. That’s where we caught lighting in a bottle. And they put in a big order for all their record industry colleagues and so forth and ordered a couple dozen pajamas. One of Fergie’s friends was the style editor for the Today Show, the national television show out of New York. So she came on TV that winter and she said… Now it was January 2010, and she said, “Move over Snuggie.” I don’t know if you remember the Snuggie, the blanket with sleeves. It was real big at this time.
Steve: Yeah of course.
Dave: So that was the benchmark for success, is the Snuggie. So she said, “Move over Snuggie, there’s a new trend sweeping Hollywood and it’s Forever Lazy.” And I mean, we were sitting there in my parents’ basement watching this just laughing because this wasn’t the next big trend. We sold a couple hundred pairs in my parents’ basement. But because she told everybody that this was the next big trend, it became the next big trend. So from there, we did the news circuit and we had some national interviews that went out. And then we kept running the digital marketing, and I mean that was basically the launch point of Forever Lazy and how our marketing began, without getting too long-winded on you there.
Steve: No, that’s crazy. Again, didn’t know that. So what did you see in terms of… Because 2008, 2009, 2010, you hit this inflection point where you take off. We’re here in 2021 now, not to try and get you to condense 10 years down here into a couple minutes, but how did that business progress? I’m sure it wasn’t just an up to the right. There’s probably ups and downs and plateaus and back up and down until you arrived where you’re at today.
Dave: Yeah so because of that success with Fergie and the national news, and all the publicity around the Forever Lazy onesie sweeping Hollywood, we were actually picked up by the infomercial company that managed the Snuggie.
Steve: No way.
Dave: Yeah. So at first the news reporters were contacting them and asking, “Hey have you heard of Forever Lazy? Everybody’s saying it’s the next Snuggie.” And they kept blowing us off. Well finally enough news outlets contacted them, they said “Maybe we should sit down with these guys.” And so we flew out to New York and we signed a contract with them, All Star Marketing is the name of the parent company. So we signed a deal with them, and we ended up licensing out our brand to them for, it was a three-year contract. So during that time, we weren’t allowed to do anything. We weren’t allowed to compete against them. We weren’t allowed to sell to anybody else. They were running it.
Dave: So because of that, we moved to Florida and we hung out in Florida and we tried launching some new businesses, and worked out of Tampa out of our apartment for a while. Tried launching a dating app. That failed so I won’t even get into that. But we tried to find stuff to keep ourselves busy. After two years, we ended up buying ourselves out of the third year of the contract. We took the leftover inventory, we bought that up off of them, moved back to Wisconsin where the roots of our business were planted, and we re-launched. We got a better website built, we started building out our inventory again, we added a children’s line, and we just started growing the brand again.
Dave: So it was almost a fresh restart. However, we had the benefit of $5 million that was just spent over the last two years on advertising Forever Lazy and making it a household name at the time. So from there, the story’s a lot quicker to tell because that was about 2013 we took the business back. And it’s just been steady growth since then. Amazon, we do a lot of business. Our website does a lot of business. We have some retail. We do QVC, where in the beginning… We’ve been doing QVC for five years, and in the beginning I would fly out there, I would go live on QVC, do the whole little song and dance in my onesie.
Steve: How have I never seen any of these clips? You have offered up any of these clips before. How hard do I have to look?
Dave: Well we hardly ever talk about Forever Lazy. Most of our working relationship has been on the Hooga brand, so I guess that’s why none of this came up. But it’s all on YouTube. If you go to Forever Lazy’s YouTube channel, you’ll find all our interviews, you’ll find some QVC stuff. There’s some good stuff out there.
Steve: All right. That’s awesome.
Dave: So yeah, that kind of brings us to today where that’s where we’re managing, and it’s just some steady growth. And then out of the success of Forever Lazy, we started working on another brand which is our alternative health brand Hooga Health. And we launched that a couple years ago, and then about a year ago is when we started working with Granular on that, when we started to get really serious about that brand. I don’t know if now’s a good time, I suppose, to segue into that. Unless you have any other questions on Forever Lazy?
Steve: I mean, boy. You could have a whole conversation just about that.
Dave: I know. There’s a lot.
Steve: I’ll try and be disciplined. I guess, what’s your comfort level in terms of scale or revenue or whatever, in terms of pre-2010 where you guys were at where you’d only sold a couple hundred units, to 2020 where Forever Lazy ended up in terms of a sense of scale, or number of employees, units sold. Just for frame of reference.
Dave: Sure. I’d say that first winter, 2009, when we launched, that first fall/winter, we sold maybe 1000 pairs of pajamas in September, October, November, December, if I had to guess. Now we can sell about 100,000 pairs a year. So considerable growth. A lot of that is due to QVC. Amazon growth has been just phenomenal. More people shopping online, especially this past year with COVID online shopping has just boomed. So now we’ll do about 100,000 pairs of pajamas a year. So very considerable growth in that regard.
Steve: Cool. And then you’d mentioned you guys had this sabbatical down to Florida where you guys had your own Skunk Works. You’re coming up with ideas. How I met you guys is we didn’t have any pre-history, pre-relationship. I think I had mentioned we had a client who had went to high school with you guys, but neither of you were friends. You just kind of knew of each other, but you guys are out in Berlin. Correct?
Steve: And you had mentioned you guys had done some research. I think it was Tyler who had maybe done some research. Or you. I can’t remember. And you’d mentioned, “Hey, we just spent… We’ve got Hooga, hoogahealth.com, a new website’s launching.” You had invested money in getting some really good high-quality video done. You’d had Amazon up and running. You had another partner in the mix, Cord, who hasn’t really come up in the story so far. So I guess, take me back all the way to the beginning of… I guess, first tell everyone what Hooga is and what you guys sell. And then talk about what led you guys to create the company and what has allowed this idea to flourish.
Dave: Sure. So Hooga was founded in 2017, and 2016 was the peak for adult onesie searches on Google. That was the peak of the trend. And we started noticing that too. So we’d now increased our revenue at this point considerably by working with QVC. At that point it was one or two years with QVC. So we decided now is the time that it would be smart for us to diversify a little bit. We wanted to sell more than just adult onesies, because if it was a trend and the trend burned out, I didn’t want to have to go find a job working for somebody else. We wanted to keep working for ourselves. So with that, Forever Lazy being so seasonal, the brunt of our work is Q4. So, when winter’s over and then you get through the returns and stuff in January, and any last-minute orders that come through in the first quarter, it’s slow.
Dave: So we spent that summer looking for new ideas. And we’re all bio hackers. We really enjoy listening to podcasts about the latest trends in health and wellness, and the more natural ways of going about staying healthy. With that, weighted blankets came up. So we started with weighted blankets. It was our first Hooga Health product. And then from there, we really started exploring the alternative health space, and our next two products we stumbled across were red light therapy panels, which is where Granular ended up entering the picture, and then also blue blocking products. So, our flagship product there is our blue blocking clip on book light. So it emits less than 1% of its light from the blue part of the spectrum so when you’re reading at night… Nobody should be using a white light. Nobody. Because they say, “Stay off your electronics. Stay off your cellphones, tablets, computers,” because it tricks your body into thinking it’s still daytime. You don’t produce the melatonin, you don’t get tired, you don’t have restful sleep, and it just spirals out of control.”
Dave: So just by doing little things like limiting your blue light exposure at night, using light bulbs that don’t emit blue light or book lights, or lamps that don’t emit blue light, it can really help… You end up have more restful sleep and stay healthier. So that book light, for a while, was the best selling book light on Amazon. We’re currently somewhere in the top three now. And then the right light therapy, we launched that because red light therapy has really become affordable in the last five years for home use. Prior to that, a lot of the applications for red light therapy had only been in doctors offices under high-powered lasers that are super expensive and just not practical for the individual consumer to own for their own home use.
Dave: So we launched those product lines. We also have some other things that are smaller parts of the business. But just helped to expand the portfolio of products for alternative health for Hooga, which are chromotherapy glasses. So different colored glasses for different moods and ailments. And also we have grounding mats and different grounding products, which… It’d take me a half an hour to explain all that to you, but the concept is: The Earth gives off electrons that benefit the body by being absorbed through our feet, through just exposure to the bare Earth. Human beings have been cut off from the Earth for so long. We wear insulated shoes. We’re indoors all the time. We’re just not connected. So by using these grounding products that we sell, it connects you to the ground energy of the Earth, and it has all sorts of health benefits for anti-inflammatory and sleep and pain and a bunch of other uses. So anyway, that’s kind of the portfolio of products that Hooga Health offers.
Steve: Cool. So you talked about that and what led you to start it and the timeline on it. Prior to coming to us, you guys had version one or two of your website. You had an Amazon Ads campaign. You guys up to this point have been pretty savvy figuring things out on your own. That’s in your DNA I guess, in terms of “Hey if we can do it ourselves and the expense is more detrimental than the potential upside of bringing in an outside partner.” But by the time you’d come to Granular, you had already paid another company to produce some good video assets. You had someone who was helping with the website. And then you obviously were actively exploring bringing on someone to help stand up your pay-per-click campaigns. I guess talk about what led you to do that, knowing that you guys have managed a lot of things internally.
Dave: Sure. So we run a really, really, really lean operation. There’s just three of us: Tyler, myself and our third business partner in Hooga is Cord. He started as our Forever Lazy employee, and then we launched Hooga while he was working for us at Forever Lazy, and he joined up with us on that as a partner. So we really believed in our red light therapy line. The studies and the research coming out on red light therapy and its benefits is almost growing exponentially right now, and it’s really getting into the mainstream. And we saw, and still see, that as the future of Hooga.
Dave: So that being said, we wanted to give our red light therapy program its absolute best chances to succeed. And we knew we had experience with pay-per-click through Google Ad Words from a decade ago, and we could figure it out. And we could probably run some campaigns. But this, I think, we wanted it to go bigger, faster. We didn’t want to have to get on the learning curve again, learn all the new changes that took place over the last decade in pay-per-click. So we started having companies reach out to us actually, which is what eventually led us to Granular is you guys didn’t reach out to us. But because we had such bad meetings with the people that did, we thought, “We got to find some Midwestern guys whose values align with ours that could do this for us.”
Dave: We met with a company out in New York. It was just some fast talking salesman guys. “We want you spending hundreds of thousands on advertising, and we want to scale that to millions. And we want to put you here and there.” I mean, it was… I mean, they really captivated us. Like, “Oh yeah, I want to spend millions. This is great.” And then after the phone call and things cooled down a little, we thought “That’s just not practical. This is ridiculous. We’re being sold a bill of goods. This isn’t right. There’s got to be some people somewhere in Wisconsin that we can just sit down with, we can get on the phone whenever we want to talk to them, go down to their office.” And eventually we signed our contract with you like right the month before COVID broke out. So we actually have never been to your offices. But that’s what we were looking for.
Dave: So Tyler got on Google and looked for some digital marketing firms in the Milwaukee area, and you guys, Granular, popped up right away. So obviously we knew you were good at digital marketing because you showed up above all the other guys. So we gave you a call and I believe we recapped that meeting with that other company. I know I was sitting there on the edge of my seat waiting for you to give me the same pitch about how “We should take your video, and we should pump it here and pump it there, and do this to the funnel and that to the funnel,” and all these things about funnels. I still don’t understand funnels. And instead we got Steve and Steve gave us a very just brass tacks approach. I don’t even think you guys wanted to use the video in the beginning. Like, “Yeah that’s great you guys spent all this money on the video, but here’s what we need to focus on. We need to do some pay-per-click. We need to focus on people searching for your competitors.”
Dave: And all the stuff you said just made so much sense, and then we were like, “All right well what’s the catch? The other company, they wanted X% of our ad spend, and this and that with certain minimums.” Nope. “Granular’s just a flat fee. We don’t care how much you spend. We’ll do the same work for you guys whether you spend 1000 or 10,000 or 100,000 a month.” And again, this was a new concept to us after all the fast talking salesmen we talked to prior to you, who’s just the antithesis of the fast talking salesman. But it was just… I think that’s why we resonated so well with you is because… Let’s just cut through the BS and just get down to what’s going to work, and where to start, and where to build from, and how to optimize, and we’ll get to the video assets later but let’s build the foundation. So that’s what we did with you guys, and we were very happy with that foundation that we were able to build off of it. For sure.
Steve: Cool. Yeah I appreciate obviously the kind words, and this is all insightful for me because obviously on the agency side you don’t hear all of the other parts of it. Didn’t realize you guys were talking to others, but obviously things worked out well. So I guess tell me about… You guys have had a good experience with Amazon, going back to Forever Lazy. Cord, who I believe manages Amazon Ads for you guys does pretty fantastic job. It’s pretty laser-focused and we said, “Hey look. Even though Granular offers Amazon Ads support, you guys are doing a fantastic job with that. So we’re going to go ahead and stand up search and shopping and YouTube and Facebook.” What was the value in having us help you guys go from zero to one last year, especially making sure you guys are primed for your busy season in Q4?
Dave: Yeah. I mean the most daunting thing for us for digital marketing was the setup. Managing multiple platforms, figuring out… We had our one-year recap call with you, what, last week or two weeks ago, and we were supposed to log into our ad accounts and we didn’t even know the passwords. We had to ask Jeremy to tell us… “Hey, can you email us the link to even log into Bing and Microsoft?” So that’s actually a testament to how much we trusted you guys, because we just never had to micromanage. Nothing. None of that at all. So the huge benefit we got right out of the gates was just getting that all set up for us, and just getting that whole ecosystem working, getting our static ads loaded, getting our video assets loaded, key words, negative key words, broad searches, narrow searches.
Dave: And then also too, the work that you guys did researching our competition and seeing what are they doing? How can we target them? How can we target people searching for them? How can we replicate their successes and minimize the same failures that they ran into? So that whole setup was really priceless for us, and we got huge value in, I mean everything, the whole program. But the setup was just monumental. It was just too daunting for us. And like I said, we do have a very lean operation, and it’s hard for us to pass stuff off to other people, but this is something that we just didn’t trust ourselves to set up correctly. So we got huge value out of that for sure.
Steve: Cool. This is kind of an ad hoc question here. How would you contrast the personalities and management styles of yourself, Tyler, and Cord. Because we could pick up on that, and I saw the value, what you’re talking about having a lean team. You both can do a good job of putting on the hat of the others, but you have certain strengths and biases towards things that allow you to make sure that… The next question was going to be, get to the key of successful client relationship and partnership. And I think having the, “Hey we’re going to trust these guys, but let’s bring a healthy level of skepticism to things as well.” We really appreciated that level of engagement, for instance, which is super important. So maybe talk about that.
Dave: Yeah. So the dynamic with us, it works out really well and it’s kind of funny. Tyler and I being best friends since we were two years old. We went to high school together, college together. In high school, Tyler’s nickname was Tito. That was his name from Spanish class. So when people would refer to us, “Oh we’re hanging out with Dave and Tito.” Or, “I hung out with Dave and Tito this weekend.” Well for the longest time, there are people that thought it was person. Dave was the first name, Antito was the last name. It was Dave Antito. So we’ve gotten grief all throughout the years for being like an old married couple and this and that. I think that even bleeds into our work relationship where we go back so far that we can banter and we get heated about things and we can argue, and then we brush it off and we just go about our job and we’re fine the next day. And we balance each other really well.
Dave: Tyler is much more the hardened skeptic than I am. I’m more the extrovert, the face of the business. Tyler had zero interest in hopping on a podcast. Never at any point will you get Tyler on an interview ever. It’s just not his forte. He could do it and he could talk to it, it’s just that’s not what he prefers doing. Tyler’s in there right now putting our Forever Lazy pajama order together for suppliers. He’s crunching the numbers. He’s doing the spreadsheets. And I’m the one being the face of the business, having the conversation with you. And Cord is kind of our adopted child I guess, if you could go on with the analogy here. Because he’s right in the middle. Sometimes he’s even said. He said, “Jeez, sometimes I feel like I’m picking the side of which parent I’m going to side with, and the other one’s going to be upset with me.” It’s funny, it’s pathetic, it’s fantastic, it’s everything all at once. So that’s our dynamic. Cord does both. Cord has no problem getting on phone calls. And he’ll do interviews if necessary.
Dave: But he’s kind of the man in the middle. So we all can wear all of the hats, and when we trained Cord for Forever Lazy, we brought him up to be able to do everything that we can do. There’s nothing that we keep from him. He has all the access that we do. So that on any given day at any given time, we can each jump in to somebody else’s shoes and pick up where the other guy left off. So, with that, our business structure is pretty fluid. We don’t really discuss probably as much as we should what each person’s individual tasks are. We just know what needs to be done on a given day, and we just make sure it gets done. And the first person to cross a certain task off the checklist, they get that done, the other guy goes to the next item. So I hope that answers your question about our working dynamic.
Steve: Yeah. No, it definitely does. So maybe talk about… Because this is your first… My hat’s off to you guys because you went for it in terms of 2020 was the year for Hooga, and obviously pre-COVID and everything, and we were obviously so excited. Obviously having a local connection that ended up not working out, but you guys still went for it as far as the investment in the product and investment in the advertising, the investment in Granular. I guess tell me about what you guys really learned about Hooga going direct to consumer selling on your own website hard, versus transacting on a platform like Amazon.
Dave: Yeah they both have their pros and their cons. When we started Hooga we thought it was just going to be an Amazon business, because we were doing so well with Forever Lazy on Amazon, and we saw that each year, the website sales went down and the Amazon sales just kept growing. So we saw Amazon as the future and we learned the Amazon ecosystem and how to be an Amazon seller. So when we launched our products for Hooga, the first thing we had in mind is: Can we sell them on Amazon. So, the website and the web business for Hooga was actually an afterthought. We launched a website just to have… Cord and I built it. We built a Shopify website in two afternoons, would just drag and drop stuff into place, just so we’d have something to support our Amazon business.
Dave: And then when we saw that web sales were actually becoming pretty significant, that’s when we spent the money and we did the full build out. We got the commercial shot that is now playing on the home page of the website. And we went harder into advertising the website. So again, that’s where Granular came in is once we realized that there was a web business to be had, we wanted to give it its best chance at success. So yeah, it started out as an afterthought. But now the web business is growing, the brand name is getting out there, thanks in big part to Granular and everything that you guys have been doing to help build our web presence with just the branding ads and running those commercials on social and everything.
Dave: So we still do the majority of our business on Amazon. However on Amazon, you are open to new competitors every single day. Everybody’s trying to knock you off all the time. And with our book light, when we launched our book light, we were pretty much the only seller of an amber book light on Amazon, We were doing so tremendously. We were the number one best-selling book light on Amazon. Now if you log onto Amazon and you search for book light, you will probably find no less than 30 amber book lights. So we were joking the other day that that product was almost too successful to the point where everybody’s knocking it off. So it’s harder to preserve your margins. It’s just a race to the bottom.
Dave: Now having that web business, you don’t have as many people that are comparing you against all the low price competition on Amazon. They’re comparing you to the one or two other websites that sell your products on web out side of Amazon. So you can maintain those margins a little better so you have more money to work with for ad spend. When the margins get too razor thin, you start advertising you can be throwing up some great numbers for return on ad spend, and so forth. But if your profit now is 10%, well you could run the most successful ad campaign in the world and it still might not be profitable because the margins are too weighty at the end. So it’s a double-edged sword and each ecosystem has its own pros and cons. But that’s what we’ve found with running Hooga on both platforms.
Steve: Okay. Yeah. I guess just one more follow up question on that, because you guys have used platforms like QVC, obviously the company that was doing the infomercials, doing it all for you and I’m sure giving you a cut or some sort of licensing fee versus the other extreme, which is having your own website where you have to drive all the traffic. You have to build the audience. We’ve got a lot of other clients and people in our network who operate their own e-commerce businesses, whether it’s their own products they create and the are vertically integrated, or if they’re retailing other products. What is your philosophy, I guess you’d say, your team’s philosophy going into 2021 and beyond? Because everyone’s on the spectrum to we’ve got to be all-in on Amazon. Other people are, we don’t want to be on Amazon at all. Then you’ve got a lot of people who are on the spectrum kind of like you guys where there’s a lot of good that can come from it, but the hedge is: Let’s make sure we’re expecting in our own website. What is your thought process as you guys head into 2021, 2022?
Dave: Yeah, kind of you like alluded to right at the end there. It’s the hedge. It’s diversifying. Our big thing is diversifying. The more product lines we can get into it, the faster we launch products, the more we can stay ahead of our competition, that’s going to help us. Because with Amazon, it’s a love/hate relationship, but you can do so well if you do it right. And if you’re the first mover, once all that other competition comes in, you still hold a smaller piece of the pie than you once did, but it’s still a very profitable piece of the pie and all the new competition usually fights over the crumbs. Even though they’re still taking a good part of our sales, you still, by being the first mover, you have the first mover advantage.
Dave: So with our strategy going forward, it’s really like I started out mentioning, just diversification, first to market, first mover advantage, keep growing both platforms. There is some synergy there. People will find us on Amazon and then they’ll check our website or they’ll find our website and check on Amazon. So we have to be relevant in both places. We continue to look for other ways to be relevant as well, and ideally we want to send as many as people as possible to our website so we can gather their emails, create a following, build brand recognition in a more… When you acquire customers for your website, you are building a family that they’ll come to you first when they’re looking for a new alternative health product. If they find something on the market that they think you should sell, they’ll come to you. We always engage and interact and spend as much time as necessary on all of our customers that come to our website, and we’d love to do that on Amazon. It’s just more impersonal. So really cultivating that relationship with our customer on our website is huge for us.
Dave: So the more people we can send to our website verus Amazon, the more opportunities we have to really build that long-term relationship with them where they understand, there’s three guys behind this company. And our mission with Hooga is just to bring affordable and effective red light therapy and other alternative therapies into the hands of people that may otherwise not be able to afford it, or find it, or know anything about it. And so whereas Amazon is really important and we do more of our revenue, a large majority of our revenue is through Amazon, it’s more impersonal. But you can’t ignore either of them because they each have their own benefits to the overall business and the overall ecosystem. Did that answer your question?
Steve: Yeah. No it answered it perfectly. That’s what I had for my questions. I wanted to give you the opportunity, anything exciting going on? Any asks you would have of anyone listening in terms of things you guys need help with, or anything you just want to promote in general?
Dave: Yeah. So we’re looking at another really exciting year for both businesses. Due to COVID and everybody working from home, the pajama business was up. I read a article earlier on in COVID saying men’s dress pants sales were down by 12, 13%, but pajama sales were up by 70 some percent. So fortunately we’ve been very blessed. I know a lot of people are struggling during COVID, but fortunately just by sheer dumb luck, we are in a couple brands and businesses that people are looking for during this time. For Hooga, people that used to go into doctors offices to get their red light therapy treatments, they’re looking into investing in an at-home unit. More people are trying to take care of their health now with COVID. It’s scared a lot of people into getting healthier, which isn’t a bad thing. So for that we’ve got a lot of products that are set up to support them.
Dave: Hooga was just approached recently to do a mini docu series about the benefits of red light therapy. So we’re really excited to be filming that in a couple months. So that will be playing on public television in the second half of this year. So watch for that. Yeah, so we’re really excited about what 2021 should have for us.
Steve: Sweet. Yeah looking forward to that docu series. I guess, last question before we sign off: Is there anyone that you would be interested in hearing their story or haven’t come on the Granular pod… Even if you don’t know them, just other guys or anyone where you have just always been interested in their story, especially if they’re a business that’s a little under the radar but you get the sense that they’re pretty successful, that you think would be a cool company for us to reach out to get on the Getting Granular Podcast?
Dave: Yeah, I’m trying to think. People often ask me, and I’m not saying you’re assuming this because you made it clear you’re not, but some people, they ask, “What other business owners do you know?” And so forth. And to be honest with you, just because being an entrepreneur and a business owner people assume you just know a bunch of business owners. I truly don’t. But I would love to hear more stories from business owners. So off the top of my head, I can’t think of anybody that really jumps out as, “Oh this is somebody you should really interview.” However I will say I listened to your leadership series that you did with Pabst and that you did with FreshFin. And by the way, we’re now eating FreshFin about two to three times a week.
Dave: So the gift card you guys got us for Christmas really helped. It got us in there, got us trying out some of their bowls and now we’re hooked. So it was really cool to listen to their story being in the restaurant industry and what they’re dealing with and how they got their start. I just love hearing local startup stories man. Anybody you can find, I’d listen because everybody has such a unique story, but at the same point there’s also so many similarities just from starting a business and what they’ve dealt with, what we’ve dealt with, that I always like hearing what other people have going.
Steve: Cool. No, that’s great. I wouldn’t expect a different answer honestly. One of the things that stood out to me is these days… I’m thinking back to the conversation you had about Fergie just giving you guys the shoutout. If that’s 2020, 2021, they would want a piece of that. You would have an influencer campaign. Everyone’s trying to get a slice of things. Back then that was just, “Hey they were just looking to help out a company that they believed in, a small business.” But everything has become so transactional, it’s hard to trust anything. And even people who claim that they’re entrepreneurs or CEOs or owners, you scratch your head and think, “Well when are you ever working on the business or with your customers if you’re just always out there networking and taking meetings, and not actually grinding?”
Steve: And that’s what I appreciated. The fact I didn’t know you guys and I feel like I’m pretty well-networked here in the Milwaukee area, and I didn’t know who you guys were at all, didn’t know your business at all, and that you could have such a cool company like this in our backyard. That’s a big part of why I wanted you to come on is because there’s a lot of cross-sections of our audience that I think would really appreciate this. There’s other e-commerce companies, people in the Milwaukee area, people who are outside of your industry. There’s people just as interested who know nothing about starting an e-commerce business where they get super into it listening to something like this. So I was also selfishly just personally interested in just talking to you one-on-one and getting more of your story and background. I knew there had to be just a lot of interesting nuggets and again, I had to be disciplined and not go down those rabbit holes with you. Otherwise we’d be talking for like five hours.
Dave: Yeah and I had to be really disciplined with my responses because my friends would always give me a hard time and say, “Oh Dave’s telling a story? Short story long,” instead of long story short. So I always keep that in the back of my mind when I’m answering questions. All right, just cut it off, don’t keep going. Because yeah, we could talk for six hours. There’s still so much to our story that we didn’t get to discuss just because it’s less relevant. But I would say that something to take away from this for listeners that have an entrepreneurial spirit but haven’t done it yet, if Tyler and I can do it, anybody can do it. Had we known what we were getting ourselves into when we prematurely quit our jobs to go sit in my parents’ basement and start selling pajamas, I don’t know if we would’ve started Forever Lazy. We would’ve started something eventually, but not in the way we did it. But it was baptism by fire and there was no turning back from that point.
Dave: But you don’t need a 30-page business plan because… We wrote business plans, but it was just to appease lenders. And those business plans never came to fruition because it’s a bunch of guesses, especially being something new and unique at the time like adult onesies. So don’t let any of that stuff stop you from just giving it a shot. Just order a small quantity of something, or whatever you’re doing, just do it small, throw it at the wall, see if it sticks. If it does, build off of it. If not, all right lick your wounds, wait for the next idea and try again. It’s exciting. There’s nothing better than working for yourself. And if my businesses tanked, I don’t know what in the world I would do because now at this point I would just be the world employee to have ever, because after being the business owner for over a decade, I don’t know what I’d do.
Dave: But it’s fun man. I love it every day. Every single day, something new.
Steve: That’s awesome. Well I think there’s no better place to end than that. Dave Hibler, co-founder of Hooga, thanks for jumping on. This is Steve Kroll signing off until next time.