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Kevin Mako: Hello, product innovators. Today we learned from the founder of a U.S. online retailer with over a thousand products in store on how to use product bundling to accelerate your product sales.

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Narrator: You're listening to the Product Startup Podcast, the show that helps bring your product idea to life by chatting with successful inventors, product developers,

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Narrator: and hardware industry professionals. Our goal here is to get to the bottom of what makes a product successful, from initial idea to getting your product on. store shelves. We're taking you step by step to build a functional product and scale your product

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Narrator: business. Hosted by Kevin Mako, one of North America's leading experts on hardware development

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Kevin Mako: for small product businesses. Now, onto the show. Welcome back, everyone. Today, I'm very excited to introduce Amy Parsons to the show. Amy is the founder of Mozzafiato, a large e-commerce health

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Kevin Mako: and beauty product store. She has over a thousand products on her platform, and it only launched a year ago. Before this, she spent 20 years as a university executive and an attorney. Today, Amy is going to share some valuable knowledge in how inventors, startups and small

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Kevin Mako: manufacturers can join with other emerging consumer products to create bundles of products to sell online, thus giving your product, much broader market access and bigger product sales. Now, on to the episode.

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Kevin Mako: Hey, Amy, welcome to the show.

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Kevin Mako: Thank you. Thanks for having me, Kevin. Very excited today to talk about product bundling and how you can increase your sales online through some creative avenues as you've done to create a very successful business. I understand you've been doing this for just a year and now you've got over a thousand products launched across

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Amy Parsons: your website. Yes, that's right. We represent 20 different brands right now on matzafiato.com, all Italian brands. So these are all brands that are founded in Italy, produced in Italy. We

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Amy Parsons: import them into the U.S. And right now we're selling exclusively on our e-commerce site, but looking to expand from there. But you're right, about a thousand products across our

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Kevin Mako: site. Very impressive. And I know you've got a tremendous experience, and I've seen a lot of the press on your company and what you've done. So we want to bring a lot of

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Kevin Mako: those learning nuggets to the audience of the product startup podcast today. First and foremost, can you explain what product bundling is and how it's been so successful for your brand and for the products that you represent?

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Amy Parsons: Yeah, sure. I mean, when we first launched the company, we didn't really anticipate doing bundling, right? We learned that lesson and we kind of stumbled into it pretty quickly after launch. So, We launched about a year ago, individual products.

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Amy Parsons: So we're in the beauty space, bath and body, fragrance, men's grooming, skin care, that type of thing. So we had your sort of traditional display of all of those different products, but our niche were these heritage Italian products.

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Amy Parsons: When we launched, we decided to do a really large virtual press conference in the U.S. worked with a press agency in New York. We invited all the beauty press from publications, podcasts, whatnot.

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Amy Parsons: A lot of our brand representatives were there online with me. So we did this big launch of Mozzafiato to the beauty press. And to prepare for that, we sent in these really beautiful boxes of products.

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Amy Parsons: So we put in, you know, various fragrances and bath and body products and these beautiful explanations of the brands and where they came from. and these types of things, we shipped them to all the beauty editors, about 20 of them ahead of time.

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Amy Parsons: So they had all the products to look and feel and hold while we were doing the press launch and I could explain all of them and they could ask questions and whatnot.

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Amy Parsons: So I'm in a business forum. I'm here in Denver and I was sitting around talking to the guys in my business forum about these beautiful gift boxes that I'm sending to all the beauty editors so they could get a sense for what we're all about.

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Amy Parsons: And one of the guys in the room raised his hand and said, you know, Amy, that's what I want. That's the product that I want to buy. And I was like, what are you talking about? He's like,

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Amy Parsons: sell me that beauty box. Sell me that bundle that you sent to those beauty editors. Don't make me go on the site and pick and choose what products I need. I don't know what I need, but I like good products

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Amy Parsons: and I like what you have. Choose them for me. Put them in a bundle and that's what I'll buy. make one for my wife. I'll buy one for her. So the light bulb sort of went off in my head of while we have a great breadth of products, thousand products,

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Amy Parsons: not everybody loves to go in there and look around and try to find their own products and that there's value in the curation, that there's value

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Amy Parsons: in putting out an original product, if you will, that we create that says, okay, Kevin, I know that you don't know these brands, maybe don't know these products. But for $100, we're going to put

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Amy Parsons: these in a bundle. And this is what you're going to do. This is what you're going to love pro raso. You're going to love Akaka, try them out, curate it together and put it together. So we scrambled

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Amy Parsons: and put together a whole bunch of bundles right away just in time for Christmas and the holiday season last year and started selling them. And they started just kind of flying.

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Amy Parsons: out the door, people wanted them for gifts. They wanted to send them for gifts. So our warehouses in Pennsylvania, we were all scrambling to even just assemble the bundles to get them out the door.

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Amy Parsons: It was madness, had no idea what we were doing. But we got over the hump of the holiday season. And then we had a chance to sit back and say, okay,

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Amy Parsons: there's really something to these bundles. And we reconfigured them. We put them together in a smart way. We created them. So there's various price points,

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Amy Parsons: different ones for men, different ones for women, different ones for home, and have been marketing them the whole year.

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Amy Parsons: And now we've created our own packaging. So we get a little bit more sophisticated with these as we go along. So now, you know, before it was beautiful gift boxes, but now it's, it's actual branded bags that people can reuse and take with them on travel.

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Amy Parsons: So, you know, we realize that especially with new brands and with a big collection,

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Amy Parsons: that there really is value in original products. And our original product is our curated bundles. And now we've put them into subscriptions as well, which we just launched a couple weeks ago on the website.

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Kevin Mako: So people can get their bundles four times a year just delivered to their door. So it just arrives automatically. So we'll see, TBD, if that's going to work or not. But we're getting into that subscription game too.

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Kevin Mako: This is such an interesting topic because it's really something that not a lot of hardware startups think about for their product. But really, if you break it down and understand the success story from your perspective, being somebody who's actually been on the retail side with

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Kevin Mako: over a thousand products on the shelf, you know what works and what doesn't. And a lot of brands aren't thinking about bundling until they're a mature product or way further down the road. But something that really stood out to me with what you just said is that this is really a way

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Kevin Mako: for new brands to get access to a market that they may not be able to sell directly to on their own. And something that's so powerful with that that I see as well is the fact that, brands or products, when you're thinking about this concept of bundling, think about what other

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Kevin Mako: complementary products or other complementary brands could fit really well with your invention or your hardware gadget or whatever it might be. Because I bet it wouldn't take you too long for you startups out there or you product developers out there to think about different

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Kevin Mako: ideas of different brands that would help extremely well complement what you're doing. And of course, that allows for such economies of scale because now it's not just your brand being promoted,

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Amy Parsons: but it's all these complementary brands who are promoting each other. So you can almost leverage off each other and scale with each other as opposed to just being an independent person all on your own. And Amy's done it. And she's seen the success as a result.

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Amy Parsons: And now, Amy, you're even spinning it up to be selling on Amazon as well. Well, we're doing up. Yeah, that's the next frontier for us. So in the first year, we've been selling exclusively on our site.

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Amy Parsons: But as we've been examining what it would look like for us to have a presence on Amazon and potentially other marketplaces. we realize that the product that we have that we would want to list are the bundles. And there's a lot of reasons for that.

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Amy Parsons: But one is when you're going out onto Amazon with individual products, those brands might already be on Amazon. There's a lot of competition out there. It's very tricky on price point.

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Amy Parsons: And it's tricky territory to be able to go out there and have a Mozzafiato store on Amazon with all of our products and all of the brands.

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Amy Parsons: But what we can do is we curate our bundles because nobody else has that on Amazon because that's a completely original product to us. We can set our own price point.

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Amy Parsons: We're not competing with any of our brands because none of them are bundled together. We're the only ones bundling them together. So we can really stand out in that marketplace if we get the price point right and we get the advertising right.

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Amy Parsons: So we are about to list five bundles on Amazon right. right now, two for men, two for women, and one for home, which we think is a great gift for anyone.

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Amy Parsons: So we'll see. It's TBD on Amazon, but by bundling, it really gives you so much more freedom to curate an original product that nobody else is going to find out there. And then,

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Amy Parsons: you know, Amazon, like any other marketplace, comes down to keywords and advertising and trying to get people to find you. But you are much more in control of your own fate. on Amazon,

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Kevin Mako: at least for a retailer like us, by creating these original products that don't exist anywhere else, rather than going out with an individual fragrance, for example,

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Kevin Mako: that you might find or might find a knockoff version of it or something that's very close to it, else we're on the site. And then you're in a tough competition for that price point.

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Kevin Mako: Great. That's such good points. The great thing about this, too, is it's another tool that hardware startups can be thinking about to use in their sales strategy or their scaling strategy.

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Kevin Mako: So you may have all these options that you're looking to sell direct. You might be starting with a crowdfunding campaign and then moving direct to wholesaler, possibly doing direct sales online through Shopify or Amazon itself. But here's another tool. And this is essentially the

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Kevin Mako: concept of bundling, putting your product with others that you can also think about to get access to these different folks as well as a number of other strategies and improvements with this. Whether you're selling on Amazon a bundle, whether you're selling on your own website as

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Kevin Mako: you did to discover the value of these bundles, there's a lot of other value as well. Can you speak

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Amy Parsons: to the value of margins? Like obviously there's savings in shipping just by being able to put these together, but there's also the fact that it's a higher ticket price so you can build more

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Amy Parsons: perceived value in. You can share costs with others in packaging and whatnot. Just speak to what you've seen in terms of the actual value of putting these things together from a financial standpoint. Yeah, it's a great question. There's so much there. But a couple points I'll make on that is

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Amy Parsons: shipping, you know, we import everything from Italy. So shipping is a huge cost for us. So we're negotiating with all of our brands to get as great of wholesale pricing as we possibly can to account

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Amy Parsons: for the shipping over to the U.S. And especially during COVID, shipping's very expensive as there just haven't been enough planes in the air that's getting a little bit better now. And so once we have the

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Amy Parsons: products and we're shipping them to the consumers. Right now, we have set the price at $75 of over $75, we pay shipping. Under $75, people pay $9.95. We've toyed with every different kind of

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Amy Parsons: shipping business model since we've been in, but right now we're set at $75 because our average order value is $100. So most people are going to get free shipping anyway. With the bundles, we're able to make

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Amy Parsons: every bundle $75 or up. So we're able to say free shipping on every bundle because it makes it work for us, right? Because we can set that average order value at a place where we can pay for

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Amy Parsons: that shipping and still come out ahead. So one, you make them to set that price point so that the shipping is attractive to customers. So we're able to do that. The other thing is as we begin to

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Amy Parsons: think about shipping on Amazon and selling these bundles on Amazon. And Amazon won't necessarily like to hear me or people like me say this. But Amazon, because that's where people shop,

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Amy Parsons: we want them to find us there. We want them to buy a bundle that has four or five different products in it. They find the one thing that they love, the brand or the product that they absolutely we love. Ideally,

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Amy Parsons: they start buying that directly from us on our website in the future because we're in the business of having long-term customers, right? We want people to come back and come back and

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Amy Parsons: come back, be their go-to store for all of their beauty and grooming essentials. And if they find that through Amazon, through a bundle, they might not love all five products in that bundle, but they

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Amy Parsons: might love two of them. And then forever more, they buy them directly from us. That's a win, because we're not paying to acquire that customer after that, we've already acquired them through Amazon. And that's

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Amy Parsons: what makes the margins that we're paying to Amazon, those commissions that you pay when you're selling products on Amazon, that's what makes it worthwhile from a business standpoint, is the future

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Kevin Mako: customer down the road are buying directly from us and you're not paying for it. So it might be a wash. It might, you might not make anything on that customer acquisition through Amazon or very

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Kevin Mako: little, right? But the value is in that visibility and that customer over their lifetime, discovering your products and buying from you. So that's what we're banking on. That's our gamble

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Kevin Mako: with Amazon and putting these these bundles on Amazon.

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Kevin Mako: And hopefully that's going to pay off for us. Well, that's valuable intel because what you're talking about here is cross-pollination of platforms. And we've seen it time and time again across a variety of avenues where as a

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Kevin Mako: product startup is scaling. And you might start originally on Shopify, but then you expand over to Amazon, and then you've maybe got some product in the store at Walmart as an example.

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Kevin Mako: What ends up happening is each of these individual pieces on their own may not be

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Kevin Mako: individually valuable or very profitable. But when you start putting all these things together, you start really building this web of sales, then it starts to actually cross-pollinate each other to the point where either one or more of them become incredibly profitable, which wouldn't have been

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Kevin Mako: without having those other resources. And you've said it right there. You know, as you start getting that brand on Amazon, some people are going to shift over to the website for either complementary things or maybe they only want one of the items within that package. So there's a lot of power to looking at these different tools.

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Amy Parsons: And that's why I really wanted to bring you on the show, Amy, to really bring this tool of bundling to the forefront of the mind of startups and hardware folks, try and think about how their product could be a great product within a bundle. So on that note, I'd like to ask you,

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Amy Parsons: are there certain trends or things that you've seen when you're putting these packages together, certain things that an individual brand can think about to be a great partner or to be a great part of a particular package or to be just a great product

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Amy Parsons: within that package or how to look for great partners to join together to be part of this. Yeah, that's a good question. I mean, when we're putting together our different bundles, obviously we're looking at different price points as well.

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Amy Parsons: So our brands that have things across various price points really helps us put it together in a bundle. So we want to create a bundle for men that's no more than $200 because that's the price point that we want to get at.

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Amy Parsons: We're looking at brands that have a whole variety of price points, right? So that they don't have just one, $150 product, that's not really going to make a bundle for us. We need to be able to pull a product that's $50, somebody else that's $20.

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Amy Parsons: So quality products at a variety of price points that can fit together neatly in a bundle.

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Amy Parsons: That's part of it as well. And we want products that have really distinctive packaging, distinctive stories that are really going to jump out in the bundle. So when people are, you know, when it arrives in people's doorsteps, they say, wow, I never

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Amy Parsons: would have found this on my own look at it. It's amazing. So it's variety, it's price point, its quality,

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Amy Parsons: and really uniqueness, right? But that's our bread and butter. We're bringing brands to the U.S. market primarily that people don't know, that may have been around for 400 years in Italy and you've never heard of it in the US.

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Amy Parsons: So we're really looking for those super unique, high quality, high style products at various price points that can really pack a punch in a bundle because we're asking people to spend one, two, three hundred dollars

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Amy Parsons: for a bundle. There's got to be a lot of value there for people to spend that money. You know, this more expensive price point, we want them to open it up and really feel like they got

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Amy Parsons: tremendous value for that money and want to come back time and time again. So that's always what we're doing, curating these different, you know, bundles, things that are going to be really

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Amy Parsons: attractive. One trend I'll just say that has been really a surprise to us in the last year is that day in and day out, men are 50% of our customers. And when we started, we thought men,

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Amy Parsons: you know, they might be 20%, they might roll on the site once in a while and buy shaving cream.

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Amy Parsons: But we found that men really want quality products too, and they don't really have other stores to go to. The big beauty retailers like Sephora and Alta, they're not really built for men.

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Amy Parsons: I don't know.

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Kevin Mako: I don't want to speak for you, Kevin, but when you walk in, you don't necessarily feel like it's for you, that there's a place to go for all of your things.

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Kevin Mako: So we have found that men like to have a place to go, and we're trying to answer that with these bundles of what does a man really need in here. So we've got like a barbershop bundle, all just the basics, right, for shaving, for beard care.

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Kevin Mako: And then we have one that's elevated Italian gentleman that has more of the Cologne and higher-end products. So, you know, finding price points and products that will speak to everybody. That's what we're trying to do.

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Kevin Mako: I love how, you know, a theme that I see with what you're saying really revolves around being unique. And in combination, really making it easy for a buyer. You're reducing those objections, those pain points, and you're making it a very simple.

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Kevin Mako: buying decision where you can buy this pack and it pretty much has everything that you need within a certain range of products or whatever else that you've curated it and you've put together. But you keep coming back to this concept of quality, unique. And for hardware

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Kevin Mako: startups out there, you know, whether you're in the beauty industry or whether you're developing an underwater fishing camera or whatever it might be, I mean, you're not in the product design and development space unless you're making something that has a unique feature. That's why you're

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Kevin Mako: developing this product. You've come up with something that is unique that the market will see unique and individual value. Of course, by listening to this show, I hope that you're doing a great job of developing a quality product at the same time.

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Kevin Mako: And that's very powerful when you look at this messaging and how to be a great team player within your product pack. And it comes down to the packaging, the quality of the product, the story behind it. And everyone on the show has heard me talk about, you know, putting your personal name

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Kevin Mako: behind the product and really, especially if it's your first product to market, creating that not only a unique product, not only a beneficial product, but something that there's a real powerful story, an individual, somebody who has had maybe their own pain point

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Kevin Mako: or seen the pain point and others and has actually gone through all the effort to get that thing designed, engineered, taken to production, which is pretty much what all of our clients are doing. And what's so powerful here is that if you think about what Amy is mentioning to the great

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Kevin Mako: products that fit well in her value, it's that uniqueness and that customization and the backstory, well, everybody who's listening to the show who's developing a product, that should be you and that can be

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Amy Parsons: you. So use these tools to your advantage when you're trying to either get into a product pack that you think you'd be a good fit for or whether you're trying to put your own product pack. Maybe you're going to individually go out there and reach out to some folks that you think

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Amy Parsons: would be good to package together with your product to be complimentary to get you those sales or get that ticket price driven up or whatever else. Many of the advantages that Amy you talked about on the show. So I really appreciate all this insight because I think that's very powerful

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Amy Parsons: to hardware startups. One last question before I let you go, Amy. Just any other tips and tricks for or folks who are looking at the packaging of their products, anything else that might help them

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Amy Parsons: either in their first time doing this sort of a structure or as they are scaling their product business with this type of a structure? Yeah, you know, I mean, we're still learning that as we go. One thing that we're finding, though, is now we're packaging our products in reusable bags.

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Amy Parsons: And so, you know, things that are branded with Mozzafiato that people will keep and reuse, travel with so that our name, our brand is always in front of them. When we first started, we had gift boxes, and they were beautiful boxes, and you open it up,

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Amy Parsons: and there's a picture of Italy and there and whatnot, but those will end up being recycled.

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Amy Parsons: People will just have our individual products sitting around, and they're not seeing our brand, Matsifiatto.

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Kevin Mako: So what we're doing now is packaging it in, you know, reusable satin bags that have our brand logo on it. So even after people take out the individual products and are using them and whatnot, hopefully our brand on that

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Amy Parsons: bag persists. People can travel with it. People can store things in it. So I think the packaging of the bundle itself, we've learned keep your logo on it, put it in some kind of packaging that people want to

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Kevin Mako: keep and reuse and have sitting on their shelf for various reasons. So your brand is always up front

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Amy Parsons: in their mind rather than just a box that immediately gets recycled and they may or may not think

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Kevin Mako: of you again. So that's a good tip. That's the direction that we're going in now just to just to keep right in front of people, stay in their closets. That's great. How can, or what's the exact website address spelled out just for those who are listening? And of

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Kevin Mako: course, as always, I'll put all the links and show notes to Amy and the website, the links below. Yeah, thanks. So we're at Mozzafiato.com, M-O-Z-Z-A-F-I-A-T-O. Mozzafiato is a big Italian word that means breathtaking.

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Kevin Mako: And we just think that it's really fun to say. So we're at Mozzafiato.com and all of our social handles are at I Am Mozzafiato. Amy, thanks so much for your insight and being on the show. today. Thanks, Kevin. It was great. Really appreciate the time. Take care.

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Narrator: Thanks for tuning in to this episode of the Product Startup Podcast, the show that teaches you what it really takes to bring your product to market and turn it into a big success. This

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Narrator: podcast series is brought to you by Mako Design + Invent, the original and leading firm in North America to provide global caliber in-to-end physical consumer product development

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Narrator: to startups, inventors, and small product business clients. you're looking for product development help on your invention, head over to Mako

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Narrator: design.com. That's ma-k-o-design.com for a free consultation from one of Mako Design's Ford Design Studios from coast to coast. Thanks for listening and see you next time.