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- [00:00]
A
These companies that we've acquired had very, very good brands, very strong brands, and the people who set them up did a phenomenal job. They did. What's missing, in my opinion, is there's three legs in a tripod. You need the marketing and you could put marketing and branding, if you want, for a moment in one. You need the operations and you need the finance. You need all three of those combined. Subscription was such a big thing. The more times you email them, the more times you talk to them, the more chances you're going to see unsubscribe rates. In the world of wine, people want to hear about it. They want to know about the discovery of wine. What are the new types of rivals that are coming up? Retention is the engine that needs to be that way for the majority of direct to consumer companies, period. Everything really is built on their retention.
- [00:50]
B
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- [02:43]
A
I'm doing well. Thank you for having me.
- [02:45]
B
I'm always impressed with when people are in that acquisition mode, when they're, when they're willing to put it down and actually acquire wine brands. So maybe start by telling you what's the biggest challenge in the wine industry where it became an opportunity to do this acquisition play.
- [03:03]
A
I'd actually even take like a 10,000 step foot back even further, right. And I would say it's not even necessarily that there's something wrong, that if you take a really far standing back look and you look at a long enough timeline every so many years, you almost need a tilling of the soil, right? So things start to get a little stale. People keep doing things the same way. People get caught up with the same items. The way in which a lot of direct consumer companies were looking at customer acquisition, when you're looking at it in the, let's call it the influencer and heyday, you know, and also the subscription heyday of 20, let's say 13, 14, 15 up through 2018, 19 was very different then you throw in Covid, right? We have a global pandemic. So a lot of companies that were direct to consumer, where products could easily be delivered at home were really seeing a very high peak during 2020, 2021 and even sometimes into 2022. The thing that you have, Eric, and I'm sure a lot of your listeners are very well in tune to this, is that a pandemic is not a frequently occurring item. It happened once and you need to take in as much cash as you can as a lot of these direct to consumer companies. But you need to manage your business model accordingly to looking at what do I think is going to occur in the next so many years. And so if you had looked at a lot of the companies in 2020, 2021, they were raising at very, very high valuations. They were bringing in hoarding in, I could say to a certain extent, inventory pulling in things as quickly as possible and really getting their fixed costs locked in. You look at someone like peloton at the time, right? It's yes, they're starting to move things and turn it around right now. But essentially what you had is they said, listen, if we take our numbers of how many units we think we're going to sell and we extrapolate them out, we forecast it, we're going to keep going down that route. The challenge that companies like that had is then they started to go international and they started to basically open up all these facilities, these manufacturing facilities. You have fixed costs that are tied in, which make it very hard. So now, kind of going from that lens, to answer your original question, what was going on in the direct to consumer space, we happen to go into wine. I love wine. I love champagne, which I'm sure you can see in my background. It is not a background, it is real. So it's, it's a nice fun thing for me that it happens to be a product that I do really love. Having said that, a lot of direct to consumer companies at that time needed to modify the way that they are working.
- [05:35]
B
How so?
- [05:36]
A
Because you essentially are extrapolating out a model, a forecast that is based off of how things were in the pandemic, and people aren't going to keep sitting at home and buying. So right now, today, our competitor is someone like a wine dot com. You can even say Trader Joe's. Trader Joe's is a big one. Costco. Right. Those are our competitors. During the pandemic of 2020, 2021, the alternative was, is this essentially going to a restaurant? Of course people were going to go back to restaurants later on. So you're going to have that consumer going back and buying those products. So what we ended up doing is looking in the market and saying, okay, what kind of industries needed to have some love? A company called Wink ended up filing for bankruptcy in 2022. We. That was our first one that we acquired in 2023.
- [06:25]
B
And with the case of Wink, was it, was it a problem of the, you know, the fake or astroturf demand spike that Covid happened and then not being able to sort of reconcile that, having that big disappointment of being like, okay, people aren't going to keep drinking like this forever, having it come back to earth and then just not being able to reconcile it with the fixed costs that they maybe invested in during that time.
- [06:47]
A
And a lot of this information, I'll share it with you here, Eric, and all your listeners as well. It's, it's public information because Wink was public, but they bought a lot of inventory. So, for example, I'll give you, I'll give you two things on Wink which I always find interesting. The first one essentially Is let's just say right now you're selling 10 bottles a month just to keep the number simple, right? So in one year you're selling 120. The pandemic hits and those numbers go up by 100amonth. All of a sudden now you say, listen, this is what I'm going to see for the go forward for the next five years. I want to make sure I have enough wine for my consumers. Let me buy a lot of wine. They pre purchased so much inventory and so much cash went into their inventory. So the challenge that you have is you have all this liquidity. This cash is now sitting locked up and tied into inventory. At some point in time the company's going to need additional cash to just run basic operations. And then 2022, they ended up filing for bankruptcy. So that was one thing. The second thing was is you essentially have, we are operators and you started off the podcast that way as well, right? We are operations people to the T. Operations and finance people. And one of the things with operations and finance, when you combine the two of them and then you look at marketing as the third leg of the tripod, that's where you really make magic happen. One of the things that Wink did a lot was they would send four bottle monthly ship insipments. The tipping point essentially from a unit economic standpoint is between five and six bottles. So what can we do to take four bottle monthly shipments and move the customers into essentially a quarterly 12 pack? We could even give consumers one bottle for free a shipment. Two bottles for free a shipment. We can do all these modifications and change it around. But the unit economics weren't ideal in 2020, 2021, when so much money was floating around and the interest rates were so low. Everybody was just talking about how quickly can we grow our consumer base, how quickly can we get more customers in? You know, the pendulum, if you look back, right, it swings back and forth all the time, every five to eight years, maybe 10. And so now there's a very hyper sensitive focus on profitability. We essentially take the companies in and we turn them profitable within 60 to 120 days.
- [09:09]
B
I think that's a really good point though that if you don't, if you haven't thought of, you know, that deep level of operations where it's like, okay, this is where we'll make our money when we, when we get them to make this purchase or whatever and you pour a lot of gas on it. In marketing, even if you're making sales, if it's not set up from an operationally sound or margin sound perspective, you're just going to be pouring fuel on a fire that's going to burn you.
- [09:31]
A
That's exactly true. And so a lot of these companies that we've acquired had very, very good brands, very strong brands. And the people who set them up did a phenomenal job. They did. What's missing, in my opinion is there's three legs in a tripod and without the three legs, you don't stand. You have to make that it stands. You need the marketing and you could put marketing and branding, if you want, for a moment in one. You need the operations and you need the finance. You need all three of those combined. And the challenge that you have, and this might answer your original question more in detail. The challenge that you have with this type of a product is one of the most expensive. Cost of shipping because it is very heavy, as opposed to, let's say you're looking at a beauty or skincare product that's a light product, margins are higher, so you have more to play with. Essentially, for this type of a company, you have to be very, very hyper focused in regards to the unit. Economics and the operations are everything in this business.
- [10:24]
B
Now walk me through a little bit. You mentioned the brands that you acquired having really strong brands, really great customer market fit. Walk me through your process for determining whether you were going to acquire one of these brands. Was it just the brand strength? What else were you looking for and what were maybe the red flags that you were for that made you like not want to buy one?
- [10:43]
A
Red flag, that's. That's always a very fun one with this too. It's a really good question. We essentially were looking for one. So in the beginning we were looking for companies that would help us fill out the infrastructure. Some of them maybe not very sexy, but some of them had certain licenses that we needed. And direct to consumer alcohol. There are certain things that just take a very long time. So some might have had some certain licenses. One of them had a lot of work that was done on an AI algorithm that had already been in play. And so for us, we were able to inherit that. All of them came with really strong customer lists, which was great, but you almost want to look at it. I look at these as if it's. All of them were pieces of a puzzle. But you're combining that with a very fast game of Tetris, because sometimes in life they're pieces that come at you with some of these companies that you might not have wanted. So how do you manage it as quickly as possible to make all this come under one umbrella. So it was definitely very challenging in regards to some of the red flags that were out there. Some of it would have to do with the rapidly deteriorating customer base. Right. So is even if you have a great customer list that is there and it's a high number and the purchase price, et cetera, everything is good across the board. What we really want to look at are the trends of the customer list over the past two to three years, ideally. Right. In addition to that, some of the companies were highly levered. How do we manage the debt that we're taking on, or if we're taking it on? And then also we have the third part, which is the personnel. What is the infrastructure that they currently have in place? What are the things that we're missing that we need? One of the companies that we acquired, there's a multitude of reasons we acquired it is Wine Access. Their customer service team were required for an extended period of time to actually have taken the W set one, and some of them the W set two as well. So there's three parts of learning for essentially, for like to get really good wine knowledge. There's the WSAT 1, 2, and 3. A lot of those customer service representatives were required to take one, and some of them even two for that type of a product. It is very helpful to have an extensive base of knowledge and understanding, even from a customer service standpoint, because people will be calling in to ask and they might want to know a little bit more about the wine. What's happening now? For us, it was very important when we take our customer service team to essentially segregate it out. So some people may be calling in for, hey, where's my shipment? Right. And other people are calling for, well, I didn't like this, this type of pinot, but there might be something else that's a little bit more suited towards my palette. How could I find something that works for me given my lifestyle?
- [13:22]
B
So when you acquire a company like that, do you then apply the customer service from that company to the rest of your brands or how much is it a game of keeping what works in a silo versus centralizing into like the full glass way of doing things?
- [13:37]
A
Do you almost want to look at it? It's such a good question because that's almost the magic sauce of what we essentially have. I'm not going to say secret sauce, because implementation of it is everything, but it's definitely the magic sauce that we essentially have. I almost would look at it as like, you know, the 80, 20 role. So 80% of it gets integrated and then 20% of it is going to stay essentially separate on its own. Right. So of the customer service, what we can do is we can say 80% of it is going to be any orders that people have coming in. Where is my shipment? I mean, that's always the big one, right? Did it come, did it arrive? It got to my house. There's logistical kind of just questions that come up. We don't need specialized experts helping those people. So those kind of customer service questions can now get routed over to a team that's going to be significantly more cost effective. The majority of the customer service team for us that does that type of work is actually abroad. And that's what really helps us from a cost standpoint as well. But then 20%, we make sure those calls are going over to that specific staff, that specific team. Now what we have been working on, and it takes time to put all this into place, but what we've been doing slowly and slowly is for some of the other brands, when people are looking to get upsold or people want to go up tier essentially and buy more premium wines, we now want those calls routed over from the other storefronts over to these customer service to encourage them to get excited about higher price point wines.
- [14:59]
B
And then you mentioned like putting it together like a puzzle. And I'm sure there's, there's lots of different, like lenses that you can look at that puzzle through. Like, is it about the, the, the, the quality of the wine or the, the price point of the wine? Is it about making sure you have a, a Pinot and a Chablis and a, you know, a Champagne, essentially? Is it about, is it about completing the puzzle of varieties of wines? Do you. Or was it more about the customer type that each brand spoke to? I'm sure it's a medley.
- [15:27]
A
It's actually, it's very specific. It's the customer type that each one spoke to. So 90% of our wines are private label. And we have the ability right now, just because we've hit such scale, that was the biggest thing with this business is can we hit scale? We've been able to hit scale, which gives us a lot of buyer power with a lot of our vendors, which is phenomenal. And we're allowed to then take on the benefits, the great things that we get, the access essentially to a lot of different varietals and we get to share that with our customers. In regards to what kind of companies we acquired it was specifically on the customer type. So you want to think about it this way. Right now we've just talked about 2. We've talked about Wink and Wine Access. So if I have right now, a Saturday, I'm having brunch with a bunch of my friends, I'm probably going to get Wink Wines. Right? Cute, fun, different labels, they're very Instagramable. We can talk about them on social. Wink had come out with last year a non alcoholic rose, which is one of the best roses I've ever tried, called cheeky 0%. And so you get all these wines, you have fun. Now the thing is, I might have my mother in law, let's say, coming over. My mother in law watches my two little kids. They're seven and five years old and I need her for my life. So I want to make sure she's impressed. And she also has very discerning taste. She is an Irish woman, she has discerning taste when it comes to wine. So she's coming over. I'll probably go to Wine Access, get some help from someone there and maybe buy her an $80 bottle of wine for a special occasion. Now the whole point here is under full glass mind, we want to keep our consumers under one umbrella. We're okay if you go from brand to brand, whatever it is. Now, people might essentially in your life as a customer, your taste profile will change over time. So you might go from one brand to go to a different one. And in addition to that, your use case might be different. So it's perceived value as well. Right. So one might essentially be going to Wink for a certain purpose, a certain use. Girlfriend's coming over for brunch on a Saturday. Discerning mother Law might be a Wine Access drink. So she still helps you with child care. Right. So that's really how we're looking at it. So it wasn't for varietals or access to the wine. It truly was the customer base is what we were looking at.
- [17:35]
B
And then do each of the brands retain their own storefront or does it all get rolled up under full glass?
- [17:41]
A
Each one retains their own storefront.
- [17:43]
B
I'm actually just on fullglass wine, which you should all go to in the audience here if you like wine like me. And I'm just seeing the article that, that was in Entrepreneur and it's really piqued my interest. How did Willy Wonka inspire you to say yes to everything for a year?
- [17:59]
A
So do you have kids, Eric?
- [18:00]
B
Yes, I have a 12 year old.
- [18:02]
A
Okay, so you'll Remember these days. And I'm sure my son, he's now 7. He was 4 or 5 years old at the time. He would watch Willy Wonka, the one with Johnny Depp on repeat. And when I mean on repeat, it was like, to the point of cringe, right? You're watching it every single day. I'm like, I can't even hear this anymore. And I have all the lines memorized. The thing that ends up happening is when you hear something on repeat, you start to actually listen to it a different way, which is really interesting. There's a scene in that movie where Johnny Depp is telling Charlie why he ended up doing the Golden Tickets and why he went out there and he said, I want to find some other people to come in and take over the business. Ultimately, he was in his annual haircut with an Oompa Loompa. And while he was getting his annual haircut, he found one gray hair. And the gray hair, for him was an indicator. Not that he's getting old necessarily, but that time is finite. Shortly after that time, I started to get some gray hair, and it wasn't about, you know, and I got gray hair at an older age. And so. Which is nice, and I'm very grateful for that. Right. It wasn't about aesthetics, Eric. It was essentially about the fact that we think we have all the time in the world. And I always wanted to wait to put everything out there in the world when it was perfect. I didn't want to do a podcast recording. I wouldn't want to put an Instagram post out. I wouldn't want to show my ideas to capital providers until it was absolutely perfect. And when I was watching that movie on repeat every day, right, it really sunk in for me. We, as human beings genuinely think we have all the time in the world, but we don't. The one thing we know is that time is finite and we don't know when something is going to happen. So I decided I'm going to make this that time period, my year of yes. And anything that comes to my mind, or any idea that comes from somebody else, I'm not going to hesitate. Of course you say no to things. You don't want to overburden your plate on things that are going on. Right. Or things that are bad for you. But it's that hesitation that you have. And you all know what I'm talking about, Eric, you included. You know that there's that moment where you're like, oh, I'm nervous. I want it to be perfect. And I Said, you know what, I'm gonna make this my time of yes. And I told myself I'm gonna do it until X month. And it happened to be like one year later, right? So until next March, I'm gonna do everything that comes up and I'm gonna go out of my way. And everything shifted for me. We would not have acquired this many companies. We would not have moved so fast. I would have not have put myself out in the market because we all have self doubt, we all have imposter syndrome. And when you come to the realization that that is just a human set of traits and everyone has that, then the next thing is, okay, now what am I going to do about it? And so getting out there, trying things, it has worked miracles for me. And I am so grateful that my son watched that movie on repeat.
- [21:03]
B
And now he gets to watch you living your Willy Wonka dream with a $200 million company within 17 months of that Willy Wonka inspiration, which is pretty cool.
- [21:13]
A
Thank you. It's been hard. Every coin has two sides, but it is really, really amazing to see everything come together.
- [21:21]
B
I don't know if you can pick a child, but what was your. What was your. The best acquisition you made during that period?
- [21:27]
A
I definitely cannot pick a child. I would say that each one had its benefits and each one had its challenges, that's for sure. Wink was one of those where it was the first one. So the first one's always going to have a special place in your heart. Right. Because you ended up acquir beginning. Wine Access is right now the last one that we did, which is probably why, subconsciously, I talked about both of those with you on three occasions now during this recording, because it's easy to remember the first and the last one there. But I think each one of them brought something different and unique to the puzzle, which really helps us be a whole company.
- [22:02]
B
Okay, so you've acquired these brands. Walk me through what happens on day one after you acquire one of these brands.
- [22:08]
A
So, Eric, we actually start on integration probably two to three months before we get close on the transaction. That's how we were able to do so many of them so quickly. So the first thing is the tech. The first thing is we put everybody on the same sub stack because essentially everyone has to be on the same technology. Everyone has to be moving together. Otherwise it makes it very, very hard to integrate and we can't move quickly. So the first thing we work on is tech integration. Now, you never know for sure if, if the deal is going to go through, but you'll have someone who's under the tent on the other side, on the acquisition side, and you start working with them through the tech to see what are all the things that need to get done. Is this something that's possible? Because a lot of that actually, Eric, has to do with our purchase price as well. So, for example, if they're on the same tech stack as us, the integration work is going to be easier. And then therefore it would be a modification potentially to the purchase price as well, as opposed to if there's a higher lift for our team to integrate it, it's going to be a lot more work. So the first thing is tech. Then the second thing is going to be our three PL for shipping, because by T minus 10 days, that has to be set up, teed up, ready to go. Because for the customers, it shouldn't even be a glitch. It should just be one system turns off and one system turns off, right off and on. And then basically the customers are getting their, their direct next shipment. Then the third thing after that. So you say day one, we've closed after everybody has their introductions. All those things then is accounting and finance. The last, last one, ironically, is actually marketing and branding. If you don't have the others. We're very big on infrastructure. So the infrastructural components have to get done first before anything else happens. And the accounting and finance can take. It can take six to nine months because a lot of times the systems that they're in, the numbers that we're getting, everything is all over the place. And finance is very, very important because that's what ultimately helps us look at again, the unit economics. And that's what gives the visibility and the direction to marketing for them to be able, the marketing team to say, listen, this is where we need to go, this is what we need to move. And it comes back to what I started at the beginning of this podcast was three legs of the tripod.
- [24:17]
B
And then would you say that the shipping and logistics piece is the biggest impact soonest in a way with you can just with your economies of scale and what you can provide there with how hard and expensive shipping is in the wine industry, Is that where your biggest unlock is in the early days?
- [24:33]
A
In the early days, the first thing that you're going to see, the biggest unlock is going to be in shipping and logistics. Because we are the largest client now for our 3 PL and it gives us a lot of negotiating power, but we have a very good relationship with our three pl. And so it's a very symbiotic relationship that we have because we're their larger purchase client.
- [24:57]
B
And then talk to me about your philosophy around marketing with wine. I think in the pre interview we talked a little bit. I think I mentioned something about subscription being such an important unlock for wine. I think you pushed back on that a little bit. Just. But maybe talk to me a little bit about how you think about marketing and retention acquisition in the wine space.
- [25:15]
A
Let me tell you first, on subscription. So subscription was such a big thing in 2016, 17, 18, 19, right. A subscription works very well for products essentially where you don't want to have, want to keep talking to the consumer. So you think of something like shower heads, right? We've been seeing that a lot. So you think of like a shower head company and the shower head company. Essentially you buy the shower head and then now you're buying the replacement filters. That's on subscription. That is amazing, right. No one is sitting there thinking, I can't wait to go look at a new replacement filter and try to find a different kind. That's the coolest thing in the world. That's not something that's very eroding for individual majority of people. That's a great subscription product. You also look at something like cat litter. You see pretty litter that they think sold for like 700 million something tomorrow's a few years ago. And no one's sitting there going, yes, a cat litter is very sexy either. Right. I'm so excited about it. Subscription, great go. You know, that's amazing. Wine is very different. The challenge that you have with subscription customers typically, and anyone in subscription will understand what I'm talking about is you essentially don't, you don't want to keep emailing them. The more times you email them, the more times you talk to them, the more chances you're going to see, you're going to see unsubscribe rates, right? So that's where you kind of have an inverse relationship. You email them more, you see more unsubscribe rates. It's not a great thing in the world of wine. We want to be reaching out to them more, we want to be talking to them more. So somebody had a quarterly shipment, they might get one, one shipment in January and now they're getting their next shipment in. Let's say maybe if I reach out to them more then they're going to unsubscribe. Having said that, if they aren't on subscription during those three to four or five month period of their normal subscription. I can reach out to them and tell them, hey listen, you know, Neha Kumar over here has a bunch of great champagne magnums and she wants to offload some of her stock and she's going to give, you know, the first thousand people who buy or whatever it is a special deal or whatever, you know, on these magnums. And so let's say it's after the holidays. So we now have the ability to not only be able to reach out to them more. Number two, it also really helps us to push market because it allows us to manage and hedge our inventory balancing. We have three different warehouses that we currently use accordingly because our product is going to be, it's nuanced because you have a pick pack process essentially that you're dealing with. If someone's buying six wines in a box or 12 wines clients in a box, what if we only end up with a small limited number of inventory in one warehouse? So if I can now email out and say, listen, I have all these roses that I'm getting ready to move for Mother's Day and I can reach out to the customers even more, that actually shows us a big increase in the number of purchases that we're getting. So subscription versus transactional, essentially for us it depends on the type of product and service you're providing. Again, showerheads, filters, that's a great one to do, right? Wine people want to hear about it. They want to know about the discovery of wine. What are the new types of varietals that are coming up? Is there some new vintage that came out to be very good that we should know about? So in those kind of situations, being able to communicate with the consumer is infinitely more important than that regular subscription. Now having said that Eric, we model out our customers internally as if they are subscription because we are 100% direct to consumer. So we have the ability to actually manage and get all of the data and information on all of them so we can see how they behave. And for us essentially even with our existing investors, they view them very akin to subscription as customers because you can monitor their progress accordingly as opposed to if you're retail, you just, I mean that's a completely different model.
- [29:00]
B
I never thought of the idea of, of of emails during a subscription lifetime as being potentially detrimental versus when they're just buying. If you have this opportunity to storytell and they become this positive thing. I think, I think even in our pre interview we talked a little bit about storytelling in email versus sending always transactional emails. How do you balance in your retention flow. Storytelling versus like, you know, sales messaging or more transactional messaging.
- [29:28]
A
So we're actually putting together a playbook and we're creating it at this point in time. Our marketing was our last one. We just finished our full year of having all of the brands underneath us in 25. Again, we're a relatively new company. We launched in 2023, in June, all of our acquisitions were essentially completed in 24. So 2026 and 2027 is exactly what you're about talking, talking about. And what we're essentially looking at creating right now is a multi part series where the consumers are getting a few emails which are a multi part on storytelling on the wine, where it's coming from, getting people excited or what are new grapes, what are not new grapes, but some certain vintages which might have a certain essence something to them and then tying it with some of the products that we have that are going to be coming out on the market. So then you get the transactional email after. But so many people, they want to learn. This is the fun part about wine. It's an educational product. Again, as opposed to cat litter. No one's sitting there. Most people aren't sitting there saying I can't wait to learn more about the nuances of cat litter.
- [30:32]
B
No 100%.
- [30:33]
A
And I'll go on retention now too. Retention is the engine and that, that needs to be that way for almost the majority of direct to consumer companies, period. Right. Because unless you have a product that is, it's math, right? Unless you have a product that you're selling that is a very tight ticket price and the acquisition cost is justified and the margin is high enough. It absolutely is fine. If you were just to bring in one, the customer does one purchase. Right. Having said that, if you're selling lower margin products across the board or even just decent margin products, everything really is built on the retention. I teach undergrad, I think I was telling you that before as well in our pre interview. And so one of the things I go through with my students in our managerial accounting class essentially is, is, you know, somebody's buying a Porsche, you could sell one, right. If somebody's buying water bottles, the margin on the water bottles, like you need to sell so many water bottles and you need people coming back and buying those water bottles over and over again if you're going to actually make a viable business out of it. But if somebody just buys one water bottle, right. It's, it's not, it's really hard to call that a viable business. In the long term, retention is the engine.
- [31:45]
B
Yeah, it has to be. Do you employ SMS as well as email?
- [31:48]
A
We do, we do. And so that's essentially comes back to part of your question before on some of the things that we do centralize. So what we've been working through. So again we do tech, then it's operations and then it's accounting and finance and then marketing. Marketing. A brand for us gets split out differently. So marketing essentially has. And what we've been working towards is creating a shared services platform for marketing. Marketing. So with the marketing team, essentially what you're looking at is there's one, there's like a team, one head and then there's a team under them involved with just spearheading what are the right platforms to use for sms, how do we get the price best, pricing, how do we scale? What are the best things that are happening with email? What are the best things that are happening with all the different kind of sales channels that we can look at. So that's all centralized and you get scale there and you get institutional knowledge learning, all of those things get gained. But the brands sit on their own. The brand is, who are we speaking to? Who is my customer? What is my customer doing? How is my customer growing? How is their life changing? What is the look, the colors, the feel, the voice that we're using over to the customers? That is the one thing that sits separate from the marketing engine.
- [32:53]
B
And then this is retention. But talk to me about how are you bringing new eyeballs into your ecosystem with full glass?
- [32:59]
A
We've done a lot of testing over the past year. Our number one focus has been on the existing consumers because we acquired so many customers through the acquisitions. This is something that is public knowledge as well. I mean, Wink alone came with approximately 7 million email addresses just with one company and a very large percent of those were active customers. They essentially had a quiz that went out to a lot of people before. I'm sure anyone who had shopped at Wink remembers it, but it's, it's like a 30 second quiz. And so essentially it's do you like cantaloupe or watermelon or chocolate or cherries? And so these people had all taken a 30 to 40 second quiz. So you have a higher qualified email list as well. So we're very fortunate that that's our number one place to really tap into in regards to the existing email list. But in addition to that too, our number one focus is really taking care of the existing consumer consumers before we're really pushing out there trying to just go acquire new ones. Is new customer acquisition good? Absolutely it is. We're very fortunate that we do have organic growth in some of these brands as well.
- [34:08]
B
Yeah, I think we spoke about this on the pre interview a little bit. But I think there's a real opportunity for, you know, we started, we started this newsletter, D2C Newsletter, in order to grow an agency. It's become its own company, its own media company. But it's also helped fuel the growth of this agency where people are reading our newsletter, listening to our podcast, and then they're like, hey, where do you get all your content or your insights from? Or like, well, it's this agency that we, that we sort of run beside and I feel like there's a real opportunity for user acquisition to be done for. I'm sure there's lots of wine newsletters, but something like that where you're creating lifestyle content around. Around the wine lifestyle essentially, and then having it kind of backed by full glass in a way as a way to like, I wonder how Wink got 7 million emails. Was that all from purchases or were they. I wonder if they were running, you know, lead acquisition campaigns on top with the quiz, I guess. Right? That's how they would have got those.
- [34:57]
A
Yeah, it's with the quiz and you have a qualified email list.
- [35:01]
B
So just a question about inventory. So inventory, you know, or problems with inventory management were one of the reasons that have given you the opportunity to grow and acquire the companies that you have. How do you manage inventory and cash flow for the business now to make sure you don't get into the same
- [35:17]
A
problem, we really look at lead time, right. And so. And then we have more realistic forecasts. And I don't really want to say that people had problems before. I mean, obviously the wing filed for bankruptcy, so we can all make assumptions there to begin with. But it was just people had very hopeful, optimistic outlook that the trends that were going on in 2020 and 2021 were going to continue onwards. But it's a global pandemic. Everybody's gonna. People are gonna eventually go outside, people are gonna go back to restaurants. People like to eat out, right. And so the people that were essentially buying now at Trader Joe's, maybe some of those are still buying at home, which is nice. The people that were going to restaurants and eating at home that were ordering direct to consumer wine, they're gonna go back to restaurants, right? And so you're gonna have to remove that component of the market. So how do we look at these things? A little bit differently. We're just, we're very cash conscious. We're very, very cash conscious. So we're profitability focused first over growth at this point in time. Now could that change later? Absolutely. But today that's currently where we are. And inventory is our big thing. We are very hyper focused on inventory. And when we acquired these companies, we. They already came with so much inventory.
- [36:29]
B
And when you acquire companies, is it. Are you generally acquiring the. Like, how much of the founding team of these wineries are you acquiring?
- [36:37]
A
It depends. It's on a case by case basis. Some of them. It depends on how many people that we need. I mean, that is a hard part of it. Right. Because we already have an existing infrastructure in place. So the first two companies that we acquired, we kept a lot of the people on. Then after that, the companies that we acquired, we didn't necessarily need to take on the majority of the company. Having said that, there were a lot of changes at some of these companies that had occurred even prior to us acquiring them. Right. Because some of these companies were essentially they. They were in a position where they already had some challenges and they needed some love. So they might have already had a series of layoffs, they already had a series of downturn. And you also have just normal attrition whenever layoffs occur at companies. And so a lot of these companies have those already.
- [37:20]
B
Is there anything you've changed your mind on in the last couple years that you would have held to be true earlier in your career?
- [37:26]
A
Wow, that is a really good question. I am going to go back a little bit to my Willy Wonka one here just for a moment to just expand on that. And you really like when I was younger, earlier in my career. I wouldn't say younger, I'd say earlier in my career I really wanted to make sure that everything was perfect. And I really cared a lot about what other people said and valued a lot of other people's opinions. I thought that a lot of people around me, just because they created something or they made some progress, that they knew what they were doing. During the pandemic, an amazing thing happened for me was I was pregnant at the time. And so because I was pregnant, we didn't see anybody. I was pregnant with my second child and so we were very health conscious and I was forced to have to use my own intuition as my counsel because I didn't have other people around me. And I was at Crate and Cultivate at the time and I was selling it. So I really learned to listen to my own inner voice and my own intuition. And I don't believe gut is some magical force. Gut is a series of data points based on your experience and what you know. When it happens so fast in an instance, it just comes to you. Right. But it's all your data points, like your brain is this AI processing machine going so quickly. Not artificial obviously, but it's just a machine that's going very quickly. And so I learned to trust that so much more than what anybody else was seeing around me. And as I have continued to go forward with my career, I have continued to strengthen that muscle. And I just really listen to what I, what comes to my mind and what I need to, to do. And if my take is go out there, go bold, go do it, don't worry about the consequences, then I go and do it. When I was less experienced, I was constantly listening to what other people were saying and looking for validation. And I was always apprehensive to go out there and do something without it being perfect.
- [39:26]
B
I think that's an underrated insight. You mentioned our brains being AI computers. It's also like we live in a. Not to get too woo woo, but in a quantum reality where expectation kind of creates reality and you're really only going to be capable of what you think you're capable of. So much of our lives are sort of dictated by the limits that we set on ourselves. So I think like, having that sort of like brush with mortality via Johnny Depp can be such a profound thing because it gets you to kind of live in or open up the possibility. You know, it can kind of allow you to open up the possibilities of what you think is possible for you.
- [40:00]
A
Yeah, I, I mean, we could have a whole separate talk just on that. I completely, completely agree. And I do think it's a muscle and it's an upward spiral, not a downward spiral. Because once you start, you let go of the hesitation and you keep going. You start to see the benefits that can come from it. You go for the next thing, you go for the next thing, you go for the next thing and then you start to see the benefits occur. And it's not to get woo woo on you either, but it's almost like magic.
- [40:27]
B
So what's on the horizon? What are you most excited about for full glass in 2026?
- [40:33]
A
Very, very excited for some things that we're working on in regards to artificial intelligence. Speaking about just what we're talking about with our own brains and everything else. So being able to do these things, being able to integrate Everything internally. It's going to take us some time, but get these things move forward truly allows us the ability to be able to serve our end consumer better. And that is very fun and it is very fulfilling.
- [40:57]
B
What AI tools are you using? Are you a ChatGPT person, a cloud person, or just all of the above?
- [41:03]
A
I'm a combo of both. So UCLA has a song cloud for a lot of different things. For some of the other stuff I'm using chat GPT. My biggest thing on AI is everyone just needs to get moving and grooving with it because you gotta learn it, you gotta use it for your everyday use, whatever it is. And then you start to become more comfortable and familiar with it. And it's almost like an obsession, right? Like, it is amazing, it is amazing what you can do with AI. It blows my mind. Like the intuition, the modeling everything around
- [41:37]
B
it is next level, what it enables, right? Like, I thought we were talking with one of Pilot House's top, top, top clients and they're, they're for instance, like they're looking at like recoding a number of, you know, SaaS platforms that's going to be directly for their company. Like we live in such an age of empowered operators in a way where it's like people have pessimistic ideas of, you know, AI taking over this or that. But, but to me it's like it's just going to enhance what individuals are able to accomplish so much more. And I'm curious about your take on the line. The kids are all right. I just finished last weekend. I had my daughter in this awesome event in Victoria called Kidivate. And it was, I think 200 different tables of middle schoolers and high schoolers all coming up with their own brands and selling at the, at the mall basically for a day. And my daughter did a little skincare brand and it was really, really fun to do. What's your take on the kit on the students that you're working with? Are, are the kids all right?
- [42:35]
A
I think that they are. I think that they are so technologically advanced, I think it's amazing. You want to think about it this way, each one of these students that even so I teach undergrad, right? So each one of my students right now, even my children, my seven year old, he has access to more information at his fingertips in a moment than the president did when I was growing up. That's just mind blowing when you think about it. Someone running the country, my 7 year old has more access to more information than the president did when I was growing up when I was a child, right? So now when you think about this too, when you look at my undergrad students. So, Eric, I don't know your age. I'm not going to try to guess it here either, but I grew up in a world where we didn't have social, right? And so social was something that was up and coming later. We didn't have cell phones. I had a pager my first two years in college, right? So, but here's the thing about these younger generations right now, this is all they know. So they've only grown up with social, with technology, they've only grown into this world with that, and they are going to continue to find ways to make things work for them. Eric, when, when, when cars were created, I understand it's not the same thing, but just look at, like, everything is relative, right? But when cars were created, people thought, okay, this, everything is going to end. When ATMs were created, people thought everything was going to end, right? And so when personal computers came around, everyone's like, this is going to. You learn to evolve based on what we need to do as a civilization. And this is happening no matter what. It's just happening. So we might as well grab the bull by the horns and have fun with it and learn from it.
- [44:09]
B
I a hundred percent agree. My favorite thing about cars, I've maybe brought this up on the podcast before, but before cars, cities were literally choking in horse manure. And they were like, how are our society with more people? We're just gonna, we're gonna have dysentery, we're gonna have all these problems because we have all these horses in the street. And then all of a sudden, cars came and that whole problem disappeared in like a matter of years. And it's like, so there's, there's going to be upsides to, to the things that, that, that happen as well. We don't know what problems will disappear. And the thing. Humans have an infinite appetite for novelty. So it's like, once we don't have to toil. I think Claude likes to say toil is optional. Like, what will that open up for our appetites, for our, our potential? It is indeed a brave new world, but I'm pretty excited about it. I want to thank you for coming on the DTC podcast today. I think everyone in the audience, go check out what Niha is doing at Full Glass Wine. I'm going to go take a look at a few of the brands that you've conglomerated. Are you looking for more? Are you looking to acquire more? Are you sort of really. Are you set with what you have now and maximizing the potential within there?
- [45:15]
A
So right now we're set with what we have and maximizing the potential that we have in there. That's where for us, the retention engine is the biggest thing. We are opportunistic. We're entrepreneurs, right? So we essentially, we never really set out to buy this money companies. It just kind of happened. We thought we'll do two, maybe three, you know, okay, let's go for four. But we did seven companies and nine brands in such a short period of time. And it was definitely a roller coaster. And I think that's the entrepreneurial journey I always think about it as. It's not what do you want to do, it's what you want to do next. And one thing leads to another, leads to another, and it's that upward spiral. And amazing things can happen as long as you keep moving forward. Work hard and work smart and truly work with integrity with the people around you, because it is a really small world.
- [46:12]
B
Thanks so much for listening to today's episode Episode. If you're not a subscriber to our newsletter, you can do that right now @directtoconsumeralloneword.co. i'm Eric Dick, and this has been the DTC podcast. We'll see you next time.