eCommerce, D2C and trends: a chat with Tim Masek
"Don't write to make money, write to build relationships with like minded people you haven't yet met." This quote from Naval Ravikank, Silicon Valley's most renowned investor and thinker, is incredibly accurate - I was able to discover it thanks to this newsletter and the opportunities and connections it spawned. Among them: Tim Masek. Tim is a living eCommerce encyclopedia. He's also a great curator, eager to uncover new trends and learn the best methods to break into the fast-moving world of eCommerce. Whether you're curious about the best practices for launching a D2C brand, or whether you want to know the pitfalls and trends, Tim has all the answers in this interview. Enjoy!
1- Hi Tim! Can you tell me a little bit more about yourself and 1-800-D2C? What drives you?
I started 1-800-D2C almost exactly a year ago, as a way to help other operators in eCommerce identify the right tools to use for their business.
That idea came from a personal need where I ran growth initiatives for a number of D2C businesses and personally struggled to keep up to date with the latest and greatest tools. I basically spent a lot of useless hours every week on demo calls trying to keep up with new technology - and then the idea hit me that I might be able to streamline all of that with a directory that highlighted the stacks of the best D2C brands.
I then built the website stitching Airtable to Webflow, exploring the limits of no-code and since then it’s been the single most impactful entrepreneurial initiative I’ve ever taken on.
I left my job at Founders Factory to join Storetasker, a shopify freelance marketplace; I’ve become friendly with amazing entrepreneurs like Nick Humphreys from Linktree, I’ve made my first angel investment, grown an vibrant community and have spoken at the Webflow no-code conference. I say all this because this all happened within the past year, all thanks to a little yellow page themed directory.
And in terms of what drives me: I’ve always wanted to create a platform to impact many. I never knew exactly what that would look like. At first, I thought I wanted to create an aspirational D2C brand of my own, but I find myself now enabling entrepreneurship at a large scale via 1-800-D2C and even through Storetasker. So today, for the first time, I feel like I’m able to scratch that itch of helping the masses through a platform.
2- Previously you worked at Founders Factory helping the portfolio companies grow. What are the most common pitfalls for early-stage companies in D2C?
For me the single biggest pitfall is not realising how incredibly difficult it is to build a brand. You can package your goods beautifully with a good designer and a good developer, but customers need to feel a connection to you before they take their wallets out. That connection is almost impossible to bottle up. It takes an incredible amount of grit and luck and there’s no short-cutting it.
I think that’s a particularly difficult realisation for VC backed D2C founders who feel like they’re on the clock from the day they raise. Unfortunately, building a brand isn’t linear in terms of time. And for me as a growth operator, I was always charged with driving efficient paid acquisition which is challenging, fun and rewarding - but I also saw what can happen when the acquisition tap runs low and you’ve got a team of 3-5 that can no longer be supported. “Brand” solves for that, but again - you can’t time that.
3- What recommendations would you give a D2C brand launching in the market?
1. Pick a market with good dynamics:
As basic as this sounds, I’m shocked by so many D2C brands I see launch. Like, really? A Burrito holder? Are you kidding me? (as with everything, I may well be proven wrong in the next 6 months). But I absolutely see businesses who have carefully considered the market they wish to enter, and it’s much easier if you make the right bet. For example: Fussy deodorant chose to not go into body care because the brand loyalty to a deodorant is lightyears greater than it is for body-wash. That’s super rational to me.
2. Get your community to spread the word for you:
You won’t ever be able to win on paid ads alone. You need your community to shout you out in order to actually stand a chance. So that needs to be baked into your business from day 1. For example, Ash from Obvi created a Facebook group of 40,000 women where he asks them which flavors they want to try next. That’s how the Obvi expands its SKU count. The community is built INTO Obvi.
Another example is TikTok. I see many brands launching TikTok as a new / add-on channel. That’s not what I’m talking about here. I’m instead saying: If you’re bullish on TikTok: Launch your site, your email flows, your SMS etc with TikTok in-mind through all of it. Don’t make it an add-on, build community INTO your business.
Shout out Social Snowball who’s helping D2Cs accelerate this, turning every single purchaser into an affiliate, automatically.
3. Don’t launch subscription. Launch memberships:
Yes, subscriptions are everywhere. But they’re far from perfect. Cohorts are often all over the place and frankly it’s sometimes difficult to decipher whether single purchase buyers are more or less valuable than subscribers. In any case - subscription is a bit of a mess. But reframing a subscription to a “membership” feels right to me. Brands like Rapha (cycling brand) have a great membership for example: For a few hundred dollars a year, you get access to perks like exclusive swag, free in-store coffee, access to forums and races etc. The perks justify the membership, the members drive up brand equity and the cash creates genuine ARR. I like that much more than fickle subscription revenue.
3- According to you, what would be the perfect eCommerce stack?
As you can imagine I get asked this question quite a bit. My answer may surprise you, but I don’t think you need a million apps. Some apps can help you in very difficult areas of your business, but for the most part - you might actually want to build stuff yourself if you can afford it.
Regardless - you need an eCommerce platform and that has to be Shopify. After that, you absolutely need great customer support and none does this better than Gorgias. You’ll also need reviews and Okendo crushes it there, but so does Junip. Once you have that you need to communicate to your customers via email & SMS, so that’s gonna be Klaviyo (no-brainer) and then Attentive or Postscript. Finally you need to track activity! So you’ll need Triple Whale. And if you really want to be an A+ student, get Wonderment for order tracking.
4- What are the current hottest trends in the space and how do you see them evolve?
I see 2 big trends: Memberships and marketplaces.
I’ve already mentioned memberships, but basically I think they could replace subscriptions. The question becomes, how do you make your membership valuable? Will you go for a “member discount” approach like Kroger’s or even newer D2Cs like Italic? Or will you offer free shipping like Amazon Prime? Or will it be exclusive perks like Rapha?
Novel’s betting on this shift and verifying memberships via NFTs. So I’m excited about them. And I’m also excited about Conjured memberships, another tool in the space that’s picked up on the trend.
And secondly, marketplaces: Right now it’s impossible to keep track of every D2C out there. That’s why you have great directories like Thingtesting and 1-800-D2C popping up. That’s the first step. The next step is to actually categorize all these D2Cs into vertical marketplaces for consumers to more easily purchase. The Feed is doing this well, so is Mayple and I’m certain we’ll see many more.
The D2Cs are also begging for this because they need more reliable revenue streams outside of D2C and Amazon. The other thing on marketplaces is that the tech is now in place to enable this without any friction. Canal and Carro are leading the charge, basically enabling D2Cs on Shopify to cross-sell products from other brands on their site. It’s genius. Each brand fulfils their orders - no need for any operational gymnastics.
5- Let’s get wacky. 10 years from now, how do you envision eCommerce?
I feel like we’ll start to see MEGA brands 10 years from now. Why are we still stuck on Mickey Mouse and Hello Kitty? Somebody’s gotta topple them. And with social media continuing to thrive and the virality of humans increasing in speed - we’ll see that happen with brands too. For instance it only took 10 years for Gymshark to become a real threat to Adidas and other sports brands. By comparison it took 46 years for Adidas to IPO. Gymshark’s secret weapon wasn’t product innovation - it was social media. Lots and lots of gym selfies. Those mega brands will also take on a life outside of retail and into media, gaming, services, the metaverse. Kinda like Red Bull. But bigger, faster, stronger.
Do you want to access the best business trends, opportunities and unconventional ideas as the world shifts? Then you NEED to check out Magma, a french paid newsletter on trends, that just launched the english version. (disclaimer: I occasionally write for them :)
I love Derek Thomson’s podcast and in particular this one, “The Future is going to be weird as hell” with guest Kevin Roose (The New York Times). It’s about the metaverse, crypto, NFTs, and the maybe-BS or maybe-brilliant future of technology.
This Tweet. 🤯
The true cost of a cookie, courtesy of the Boston Consulting Group.
