Navigating the Reality of Launching—and Closing—an eCommerce Business with Mike Stevens (episode 516)
Mike Stevens is one of the DTC pioneers, with 8 years at Innocent Drinks back in the 2000s, and then founding good-for-you confectionery brand Peppersmith, which over 10 years he scaled all the way to exit in 2018. He’s also the author of the excellent and bestselling and award-winning book “The Direct to Consumer Playbook: The Stories and Strategies of the Brands that Wrote the DTC Rules”.
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Dive in:
[05:58] Mike’s take on sustainability, functionality, his Amazon journey, multichannel business.
[12:27] High acquisition costs due to low demand.
[15:03] Real product, timing challenges, consumer purchasing shifts.
[17:46] Running the business was full-time, unfeasible to leave on the side.
[21:17] Considering opportunity cost over easy choices.
[25:10] Passionate about purpose-driven products and consultancy.
[27:05] Listen to Mike’s Top Tips!
The Ups and Downs of Running a Business
Mike emphasizes that entrepreneurship is a rollercoaster. It’s filled with both highs and lows. His eCommerce journey has involved making tough decisions, including pivoting strategies, managing financial pressures, and dealing with personal stress. It’s important to build resilience and maintain perspective, knowing that failures and setbacks are part of the growth process.
Knowing When to Close or Pivot
Entrepreneurs must recognize when a business or idea isn’t working. That is even if they’ve put a lot of effort into it. Having the courage to transform or close a venture before it drains your energy and resources is key. Being able to assess your situation honestly, and take swift action, can prevent long-term struggles.
Think About Product-Market Fit
Even with a seemingly great product, you need to understand your target market’s needs and preferences. Assess whether there’s sufficient demand for your product at a price point that allows for profitability. Additionally, while targeting a niche can be beneficial, over-narrowing your focus can limit your potential customer base.
Opportunity Cost Matters
Mike says that the decision to close down his business wasn’t just about the financial losses. It was also about the missed opportunities to pursue other potentially successful ventures. By recognizing the hidden costs of his choice, Mike was able to make a more strategic decision and avoid further setbacks. Make decisions based on long-term goals and the potential return on investment.
Failures are Learning Experiences
Rather than seeing the closure of his business as a defeat, Mike frames it as a valuable learning experience. Failure is part of the entrepreneurial journey, but it’s essential to view these moments as opportunities for growth. Each failure brings new lessons and insights that can be applied to future projects. By reflecting on what went wrong, entrepreneurs can refine their strategies and improve their chances of success in the future.
eCommerce Book Top Tip
- The Practice: Shipping Creative Work by Seth Godin
eCommerce Traffic Top Tip
- Be as generous as possible by giving away valuable products or content. This builds deep gratitude and loyalty from consumers.
Tool Top Tip
- Adopt a disciplined approach by consistently creating and working without waiting for inspiration.
Carbon Top Tip
- Reduce returns by making product selection as simple as possible. This leads to happier customers and lowers carbon emissions by avoiding unnecessary shipping.
Interview links
- Connect with Mike
- Mike was previously on the show talking about his book, “The Direct to Consumer Playbook”, and you can listen to that episode >> here <<
- Mike on LinkedIn
Related Episodes
- Christine Nicholson explains why and how she closed eCommerce subscription business Divine Legs (episode 154)
- Ethical eCommerce and how to get to 10,000 customers in 18 months with Lucy Bloomfield (episode 253)
- Discover the perfect DTC Playbook with DTC veteran Mike Stevens (episode 390)
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