Under The Hood: Elizabeth from Baloo
We get Under the Hood of Baloo. Uncovering the secrets of one of the most successful weighted blankets.
Let's start with the inspiration for Baloo. Were you interested in the sleep space or home category for a long time? How did it come about?
I was specifically searching for a product to sell direct to consumer, and I’ve always loved the home space, but knew it would be important to make a product decision based on data not just personal interest. Coincidentally - 2 years prior to launching Baloo, an astrologist told me that I belonged in e-commerce, specifically in the home niche and that I should work with my sister who is now our Director of Operations, five years later! I took a sabbatical to Bali, and discovered weighted blankets while I was there. I felt this deep connection to the experience of letting go and relaxation, which was for me parallel to the journey that I had been taking: Trying to let go of my career control, and surrender a bit more into what would be possible if I remained open. Baloo as a brand is an expression for me of the very personal experience that I was having, but I think also connects really well to the product of a weighted blanket: sleep, relaxation, and surrender.
It seems like there's a real connection between weighted blankets, mental health and general wellbeing. Is that something you push in the messaging and the branding?
There's a lot of marketing to communicate that connection , but I'd also add that there’s a growing awareness in the market of the importance of sleep for our health, both physical health and mental.
But while customers are increasingly aware of the importance of getting better sleep, there's also an epidemic of insomnia and lack of sleep in this country. So even though we know something might be good for us, we can struggle to add it to our daily lives. And with that tension - a new market is created for natural sleep aids and remedies, and among those, weighted blankets.
What’s exciting is that with weighted blankets, there is real power in having a product that through sleep can address so many facets of individual health. Ultimately, that's when the body executes its repair work. It doesn't matter if you are a performance athlete or a high performer CEO, or you're trying to be the best parent or person that you can be: Every aspect of your health and performance is going to be improved with higher quality sleep, and weighted blankets can play a meaningful role in helping people achieve that.
I’m curious to learn more about the competitive landscape: How are you able to create a weighted blanket that is more successful than others that are available in the market?
We were early in the trend. We launched in early 2018, and awareness in the market started to build in late 2017. So we were quite early and we benefited from the timing. Another factor that I took into consideration was wanting to iterate and improve on an existing product rather than inventing something new. When you invent something new, the burden is on the brand to first educate the customer about what the product is, then try to convince them to try your product as a solution. Whereas when you build on something that's existing, you're offering an alternative option and it should be an incremental improvement, to a customer who already has an awareness of the product category.
In my opinion, today it wouldn’t be as smooth sailing to launch a new weighted blanket. In 2018, there was a lot more green space with Facebook CPMs and organic SEO ranking opportunities. But conversely - while there will always be competition and headwinds, it’s never too late to introduce a new product if it is superior to what’s already being offered.
I'm curious to understand what your first year of operation looked like vs your 3rd year of operation (current)? How different is life as the founder of Baloo?
Year one, I was a solo operator. I launched through Amazon initially because that's where it was the easiest to be discovered by high intent shoppers.
It's almost easier when you don't know what you don't know - and I was learning as I went. I didn’t add a full-time employee until the second half of the second year of operation. So up until that time, I was doing everything myself. That's vastly different from now where although we are still small, we have 5 full-time employees. We now have two fulfilment centers, one on the West coast and another on the East coast that are each privately contracted. We now have ownership of the supply chain to our customers and our main goal is now to systematise and build systems for the business to grow and scale as we add additional products. So our operation looks very different, but yet we're still a small team, still remote, and still bootstrapped.
Are you trying to stay bootstrapped? Is that a conscious decision?
It has been a conscious decision to stay bootstrapped up until now. Within the next 12 months, we will likely be looking for some outside equity investment. But the reason that I'm building this company is not for the money (although the money is a part of what comes as a result). I do this because I love the brand message and community that we're building. So having creative control over the ethics and integrity of the brand is extremely important to me. I'd rather grow more slowly and sustainably than scale very rapidly and recklessly, even if that were a possibility with outside funds.
Going back to a previous point you made about quickly expanding from 1 to 5 employees. Which was the first? and what came after that?
The first hire that I made was a marketing coordinator. It was the easiest place for me to see that I needed help. The subsequent addition was the director of operations, followed by a senior marketing officer. And after, a customer service lead. All hires have been incredibly impactful - And where Baloo has felt the most impact has been with the director of operations. This person is the backbone of the business. In my experience, there are ways to get marketing done without hiring a full-time employee for it, but having a full-time coworker in operations is vital... Perhaps that’s because I see myself more as a marketer.
How did you find such a good director of operations?
That director of operations is also my sister, so she's family. So she was relatively easy to find! She didn't have a classic job history to make her the perfect hire. Her background was in wholesale sales. So she had a bit of exposure to backend operations and order fulfilment through that role which required some interface with her company’s warehouse ops, but she's had a tremendous amount to learn on the job. I had the benefit of knowing her skillset, and mental attitude were aligned with mine. She's very good at logistics, organisation, and problem solving - which are three things that you really need in an operations hire. She just had to translate her experience from one industry to another.
It seems like one of the big breakthroughs in the business has been solving the operations bit. Could you shed a little more light on how you went about solving that?
I have a lot to say on the topic of 3PL’s. We've only been around for 3 years, but we've been through lifetimes of fulfilment growing pains. I think it's very important to have access to the place where your goods are stored: That's your connection to your customer. So you want to pick a fulfilment partner that lets you have that level of control. There are a lot of providers out there that have great branding and have raised a lot of money, but they often have distributed networks across the country - which means you don't have that soft touch. You are a number to them, not a client.
The other thing to be wary of is that warehouses will give you a great sales presentation to get your goods - and once they’ve achieved that, it's very hard to switch out. My #1 piece of advice I have is to go on a personal recommendation with looking for 3PL’s. Make sure you speak to actual client references, get their actual testimonials on what they're good at. Never ever skip that step because there are 1000’s of 3PL’s and warehouses, and you can find the perfect one that fits your business and your ethos.
At this stage we've been through 5 different fulfilment partners and as soon as I start to see a sign that we're not getting prioritised, where there’s accounting or communication breakdowns, or where we're not getting our questions answered in a timely manner - I don't tolerate that very long because it usually isn’t going to get better. What’s particularly challenging right now is that there’s a huge increase in 3PL demand. So as a brand, you're competing for the warehouse, not the other way around.
How do you keep track of the efficiency of your operation?
We feel that from the customer side. Once the customer service tickets start to increase, you'll sense that right away: That's keeping the pulse on the operations.
Are you focusing on customers in the US? Or are you starting to see purchases coming from international locations too?
90% of our business is in the US. We have a small percentage of sales in Canada, but we’ve also started to see a major increase in awareness in weighted blankets in the UK. That's really exciting. So we're opening up a UK website with distribution locally there very soon.
I’m curious - How did you spot those demand signals? And what would be the first thing to do to expand into the UK? Would you go via Amazon again, or would you do something different?
So - we are available on Amazon in the UK. And that's how we started to see the demand.
The demand outpaced our inventory by a lot over the holidays - we sold out much faster than we expected. And then we took a closer look using Google search volume which validated our assumption on the hockey stick growth that was happening.
So now - we are expanding our Shopify presence there, and we're adding a new, 3PL there as well because we feel that D2C fulfilment shouldn't be coming in an Amazon box.
So this becomes almost like a playbook for you where you're using your skills on Amazon to identify different markets. And then once you have a good sense of the numbers, that's when you roll out the big guns by locking in a 3PL partner and setting up a local Shopify presence.
Yes. I think Amazon is a great proxy for the market in general. It's a fraction of the market, but it lets you measure the market in a way that's generating sales.
One more question on the product. How, how is that developing over time? Are you mainly obsessing over creating the best weighted blanket in the world? Or are you expanding the range?
We've evolved our product line of weighted blankets now to be the only option that uses cotton through and through instead of other brands that advertise to be cotton, but are also using polyester filling inside the middle of the blanket. So that was an evolution for us: Moving away from polyester. We also moved away from all plastic in our packaging.
But at the same time as we're improving on our core products, we're also offering complementary new ones based on feedback from the market. For instance, we launched weighted comforters because people were asking us to give them bigger blankets to share. And for the kids' blankets, some customers reached out saying, “my son would love this” or “I've got to get this for my daughter”. So we're responding to the customers. But in my opinion, it's important to not overwhelm people with too much choice or to make their shopping decision confusing. But as a store, it's important to have enough products to continue to build lifetime value with customers. So our medium to long-term goal is to expand into other wellness categories.
Elizabeth. Thank you!! Will be cheering you on from the sidelines :)