What on earth possessed us to start a watch brand? That's a question we get all the time.
We saw boring, repetitive designs churned out year after year. We saw watches that didn't provide for individual expression.
There was a blatant lack of uniqueness of style and colorways.
Plus, we saw brands that did not connect directly with the people who were wearing their products. There was a significant disconnect.
The market was ready for something new and different. A watch brand that would connect to its fans, one that would form and sustain real relationships.
A brand that would involve the people who bought their watches in the process of product development.
A brand that would continually aim to create distinctive limited edition watches screaming attitude and nonconformity.
Perfect timepieces for the watch lover looking for something different to add to his or her collection. We saw the need and created LIV Watches.
In This Conversation We Discuss:
- [00:00] Intro
- [00:56] Tongue twisters and ad copies
- [01:33] LIV’s founding story
- [03:25] The benefit of Chaz’s background
- [04:51] How LIV got their unique designs
- [06:46] The crowdfunding go-to-market strategy
- [08:32] The benefits of successful Kickstarters
- [09:50] Look to challenge traditional approaches
- [11:31] Reinforcing the “no budget” motto
- [12:08] Sponsor: Electric Eye electriceye.io
- [12:28] Sponsor: Mesa apps.shopify.com/mesa
- [13:13] Sponsor: Gorgias gorgias.grsm.io/honest
- [14:39] Sponsor: Rewind rewind.io/honest
- [15:12] Sponsor: Klaviyo klaviyo.com/honest
- [15:59] The prospecting and retargeting process
- [16:56] Relationships and having the last word
- [18:01] From crowdfunding to DTC
- [21:00] Building their custom crowdfunding platform
- [23:06] Backing games on Kickstarter
- [23:44] Cons of using Kickstarter
- [25:31] Be careful with data and feedback
- [26:50] Lifetime value and cost per acquisition
- [28:05] Where to find LIV Watches
- Fine Swiss watches from a brand that really cares about you and your collection livwatches.com
- Connect with Chaz @Chazanow
- Scale your business with electriceye.io
- Download Mesa at the Shopify App Store apps.shopify.com/mesa
- Level up your customer support gorgias.grsm.io/honest
- Respond to any of Rewind’s welcome emails and mention HONEST ECOMMERCE to get 1 month free rewind.io/honest
- Get started with a free account at klaviyo.com/honest
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If you're going to create a new product, you really need to think about creative ways to get it done.
Welcome to Honest Ecommerce, a podcast dedicated to cutting through the BS and finding actionable advice for online store owners. I'm your host, Chase Clymer. And I believe running a direct-to-consumer brand does not have to be complicated or a guessing game.
On this podcast, we interview founders and experts who are putting in the work and creating real results.
I also share my own insights from running our top Shopify consultancy, Electric Eye. We cut the fluff in favor of facts to help you grow your Ecommerce business.
Let's get on with the show.
Hey everybody, welcome back to another episode of Honest Ecommerce. I'm your host, Chase Clymer.
And today, I'm welcoming to the show, one of the co-founders of LIV Swiss Watches: a brand that creates unique handcrafted Limited Edition Swiss wrist watches that stand the test of time.
Chaz, welcome to the show.
Thank you for having me. How's it going?
Oh man, I almost got caught up on that tongue twister that you threw at me.
(laughs) Listen, you did pretty good on that. I think.
I have a lot of practice reading and talking at the same time. That is a skill I picked up doing this podcast for the last 3 years. So I'm pretty good at it.
Yeah. The ad reads that our sponsors give us, they... I believe it's their job to ruin my life [by] putting words together that shouldn't.
There's something to be said about writing copy for reading and then writing copy for speaking. They're 2 different monsters.
Awesome. So Chaz, take me back to the beginning, what possessed you to start a watch brand?
So a little bit of history about myself. As a child, I've been a watch freak so I didn't just decide one day to build a brand. I've been obsessed with watches since I was a child.
I got my first Swatch watch back in 1983. I don't look that old but I remember that (laughs), and I just became obsessed with it.
And so when I got into college, I actually dropped out. But I got an opportunity to work for a small brand, here in Miami.
They were making Swiss watches, they had their own brand, and they were manufacturing watches in Switzerland, and selling them over here in the States. All traditional stuff, obviously, at that time. Roughly 1994 - 1995. I worked for them for a while.
And I went from doing sales to production. And then as the 2000s came, I just... Obviously, that company actually ended up folding or being sold and then folded.
And then I ended up going into Ecommerce, doing watches on Ecommerce, buying, and selling, and trading watches online. And then right after I got married, I just got tired of what I was doing in the sense that I felt like I was just buying and selling.
I was just basically a facilitator for people in your watches. I didn't feel like I was actually doing anything or creating anything.
And obviously, with the smartphone, and with Facebook Marketing, and how things were changing, I felt that was the opportunity for us to go ahead and make a change. So we just made the change.
And in 2012, we started the planning. In 2013, we started actual prototyping. And we had this whole idea of how we were going to do things a little bit differently. So we can get into that as well.
Oh no, no, that's a fantastic story. Now, I think that it's pretty important to point out that you had a lot of background in space.
How much of that do you think helped you get things going in the right direction? And how much do you think that your existing knowledge might have hindered things for being a scrappy startup?
Well, definitely. The fact that I had some history in production, I understood what it takes to manufacture a watch. I didn't just say, "Okay, here's the design. We're going to have found... We're just going to manufacture it." So definitely, that helped.
I think I had the necessary pieces. And I think what my co-founder, which is my wife, what she brought to the table was organization.
And she brought more structure into how we were going to do things. I had these ideas, but someone had to implement it.
So I got really, really lucky in the sense that I had the prior knowledge and production. I had experience in Ecommerce because I started my own website in 2000.
And then when she came along, things just aligned. The whole idea of smartphones, people shopping online, Ecommerce becoming...
It went from being national to international. And it's just... There's no such thing as a product being sold just in the states now. We're selling things everywhere in the world.
We've actually shipped to almost, I think, over 100 countries already.
That's awesome. And now, take me back to those first sales though. You get the prototypes going and you launch. What was the go-to-market strategy? How are you trying to acquire customers back then?
Great question. So going back to prototyping and that part, I'm not a product designer. I have a sense of what I'd like in the sense; What I would like to have in a watch, what kind of design elements etc, etc...
But I'm not actually the person that's actually going to do the CAD drawing or do any of those to 2d - 3d or any of those types of things.
So what we decided was that instead of just hiring a designer, we decided --when we made the brand-- we decided right off the bat, that it can't be anything traditional. It has to be something completely different.
So, if we want to succeed, we have to think differently. So we'd like to say, "No budget." That was our first idea. [It] was to say, "Okay, what would we do if we had zero budget?"
And that's how we do till today. We always question every time we do anything. It's still the motto of the brand; It's to figure out “How do we do it without any budget?”
And then we start adding budget to it once we start to... Once we figure out what we can do and what we can't do. But I think that has always been the mindset.
So when we figured out how we're gonna do the design, I said, "I'm not hiring the designer to sit in my office who's gonna make me crazy. I'm gonna make him crazy, and we're gonna get upset at each other, and just one end up with one design."
So what we decided to do was, we actually crowdsourced the design of our first launch. We actually went out and we hit up product designers from all over the world, using mostly Behance.
And we basically got them to join our challenge. We called it The LIV Design Challenge. And we ended up with 6 winning designs. And I worked with all those designers till today. Well, most of them. Not all of them, but most of them, I worked with till today.
So that was just one way of doing things, just completely different. That's from a product perspective. Then once we had our prototypes and we knew what we wanted to do, then we said, "Okay, now let's sell it. Okay, how do we sell this thing?" We need it now... We have...
We believe it's a proven concept. But is it really proven? It's not proven until the public decides that they agree with what we've created.
And so the next step was, "Let's go to Kickstarter." And that's where we did the Kickstarter campaign. So we did our first Kickstarter campaign, no marketing budget, just friends and family and people that we knew and we did $200,000 on our first our first Kickstarter.
But it's not really the money. Because $200,000, yes, it's nice for a first Kickstarter but it wasn't really about that. It basically proved that people were willing to put in the money and it wasn't a cheap product.
We're selling it for like $400, a lot for a brand that did not exist 6 months earlier. And so we proved it on Kickstarter, our first Kickstarter campaign. And then we went again. We went back to Kickstarter.
And this time, the second time we went to Kickstarter, that's when we started realizing that we if we want to push... If you want to scale this Kickstarter campaign, we need to add marketing dollars.
And that's when we started adding marketing dollars. Our second campaign.... First campaign, we did $200,000, second campaign, we did $1.1 million.
So that required some marketing campaign, the next campaign that we did was almost $2 million.
And we obviously doubled the amount of marketing that we spent. So we did a lot of pre-launch prospecting, telling people, "Hey." We want to get people excited.
We can't just like say, "Here's the project, please back it." We have to warm up these audiences and let them know, "Hey, this is what we're doing. This is who we are."
A little bit of some history. I think people need that. So I think the pre-launches were really, really pivotal in making sure that our Kickstarter campaigns were good.
And the other thing that I feel like what we learned from the first Kickstarter campaign is that I realized how many watch freaks there are like me.
So, what we didn't realize was... "Okay, I must be like a one-off, crazy person that just keeps looking at magazines and gets really excited every time Facebook shows me an ad for a watch. Am I the only person [like] that?"
And then we realized right away that there's a whole community of people like me out there --at different levels, obviously-- but that [are] just highly obsessed with watches. And so we tapped into that using Kickstarter.
And also the brand sort of molded into this community of watch lovers that just want beautiful products. And we're not just... Until today, we realized early on that people don't just... They don't just want to buy the watch.
They want to communicate, they want to have a connection with the people that are creating products that they're putting on their wrist. Until today, our motto is that if you look at our reviews, a lot of our reviews don't talk about the watch.
They talk more about the brand and the ethos and the DNA of the brand and how the communication is just so unique. It's just not... It's all on a personal level.
So all that sort of evolved from our Kickstarter campaign. Now that's the longest answer you've ever gotten, Chase. 100%.
Oh but I love it, Chaz. We've had a few brands that have done the Kickstarter route, the crowdsourcing, crowdfunding route to get things off the ground.
I think you're the first brand to talk about crowdsourcing on their product design. So that's super unique and I thank you for sharing that with us.
Yeah. It was really, really awesome. It was really... I don't know if it's possible to do it today. I think back then ,things were a little bit different.
But I encourage everyone... Any entrepreneur out there, if you're going to create a new product, you really need to think about creative ways to get it done. The tradition...
Don't think of anything traditional. When I say "What [are people] doing today?" You should say, "Okay, what are people doing in the next year?"
What's going to happen in a year or two years from now? In the sense, it's like "How can we be creative or change the way we do things?"
Yeah, that's fantastic advice. I read this book and I really wish I remembered it. But there was a little story in the book. And it was talking about... This guy had some sort of home repair business or whatnot.
And he had to send 2 trucks out every time to his projects. It was like, one truck was the asphalt, the other truck was the water or something.
And he's like, "This is killing my margins having to have 2 people do this. Blah, blah, blah." And he's like, "How can I save money here? How can I be more efficient?"
And the traditional (strategy) was [just] “Screw it. You have 2 trucks.” But what he stumbled upon was how to do it differently. He just built custom trucks that had... One half of it was the asphalt, one half of it was the water. He then cut his manpower in half, cut his gas in half...
...and then he could send... Actually, he could send more people to more locations and his efficiency and his profit just shot through the roof.
So that goes in line with what you're saying is like the traditional way of doing it doesn't mean it's the only way to do it. And there's probably a better, more efficient way to do something.
Yeah, I agree. I agree. I always have to think... Like I said before, till today, we're always thinking in terms of like zero budget.
I feel like that's a really good starting point for any new, either a project , product or any endeavor that you're doing.
Think of it with no budget, and then add budget as you fail to find creative ways. But you know, try to stick to the "no budget" motto as long as you can. Because I feel like that's where the creative part comes in.
I think that's often why funded companies fail is they throw money at problems instead of just thinking strategically about solving the problem?
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Quickly though I want to touch on the Kickstarter stuff as you started to invest marketing dollars into that.
Yeah, exactly. So we did a lot of prospecting beforehand. And then we had this really nice sequence of emails that explained our stories.
One of the campaigns, the sequence was 10 emails. So they would get 10 emails over a 10-day period just telling them the story, basically what I'm explaining to you, but maybe in more depth.
Because again, we realized that people that like watches --if we're prospecting the right audience-- they're interested in the stuff. They want to get to know the brands.
There's a lot of things that are new. Now, maybe more brands are doing that. But 5, 6, 7 years ago, I don't think brands were... Let's say for example, we never called a customer "customer" here.
For us, customer is a dirty word. We call everybody fans. We call people ambassadors and advocates. That's our tiers. That's the connection that we're trying to grow.
Internally, we always discuss that we... When we talk to people... Think of it in dating terms, how would you... How would you talk to somebody if you wanted to date them, right?
We don't want to date our fans.
But the point is that if you talk to somebody and he says goodbye, then you say goodbye, too. You say, "Oh, have a great day."
And the other person [is like] "You have a great day too."
"Well, hope you have a great week."
And then just... You know what I'm saying? Always be the person to say the last word. You're the one that's ending the conversation.
And so they can you don't I'm saying that it just gives you a different feeling that the people really care. We don't do a lot of blasting emails. We don't...
We try to personalize everything. So that people feel that it's... There is a real brand of passionate people that love making watches. And besides having good sales, we really love the fact that people are worried our product.
Let's go to the middle part of this journey.
So there was a transition where it switched from being like a Kickstarter brand to being a more traditional Ecommerce brand and more of the sales started to go through the actual direct-to-consumer website.
What was that journey like? And then how have things changed with product launches?
That's a great question. Yeah. So at some point, we realized that we just can't continue to do Kickstarter campaigns for a lot of different reasons.
From a production standpoint, it becomes hard. Also, it took up a lot of time in the sense... These Kickstarter campaigns, people think you just put up a page. There was a lot of planning to pre-launch.
There's a lot of money that you have to put out for prospecting, that you're not 100% sure it's gonna convert. There are a lot of different pieces in it. And a lot of people just don't want to do the Kickstarter route.
And we found a lot of people that have backed other Kickstarter projects. They got burnt on Kickstarter projects. They're like, "I'm never going back there again."
And so if you're relying on people just continually going back to Kickstarters, it's just...
Eventually you do need to make the transition, which is a great point that you brought up just now.
And so yeah, there was like a year where we said, "Okay, we're not doing the Kickstarter thing anymore." And we're moving to traditional Shopify, obviously. Ecommerce.
And that was a tough year, because now you really have to... You've honed in on your skill for launching products on Kickstarter and you have your model set.
And now you have to say, "Okay, I'm going to stop doing that. And I'm going to rely on traditional sales like so." It is hard when you're going for $2 million in a sales campaign and all of a sudden, you're struggling to do a million and a half in regular sales.
So you feel like you're going backwards. But that was pivotal for us to make that transition.
And I would highly suggest that anybody who's going to go the Kickstarter route, start planning early to make that transition because you cannot continuously do that both from the lifetime value if you want people to come back and buy new products.
Obviously, [in] today's day and age, you need people to come back and buy products again. You need recurring customers. Or fans, I should say, in these terms.
So yeah, it was a very hard year. We had to scrap and... We were used to doing 30 days and we did $2 million of sales.
And we just kick back and then just start doing other stuff and getting ready for our next campaign.
All of a sudden, it's the daily grind of getting your ads up, your retargeting, your emails, your push notifications, your calendars... All of a sudden, now I'm looking at a calendar.
My father's day, the graduation, corporate gifting, all that stuff. I'm thinking about all those things now. So that was a tough year.
But we did it, we pushed through it, and we still do launches. I don't know if you know about this, but we have... We built basically our own Kickstarter launch platform for new products.
I don't know if you've seen it. We had one just now. We launched a brand new watch on it. And basically...
We just basically target our audience --and obviously some cold audiences-- to come to our own platform that we control, that's our branded platform. It's just...
It makes more sense for us. It's a more seamless type of experience from a technical standpoint, as well.
There's something to be said. There's some innate trust that comes along with the Kickstarter platform for launching a new brand.
So that makes it... I think it makes it a little bit easier for people, especially [since] Kickstarter lends itself to early adopters, which I think in your space...
Especially with watches, people would love to be early adopters of some of the other legacy brands out there having an older watch, one of the first or second models.
So I think that definitely is a --what is that called-- "lightning in a jar" or whatnot with those first couple of launches. But you are right.
You need to be able to transition to a higher lifetime value and keep that customer around and keep your margins a little bit better.
I don't know if a lot of people know about that but Kickstarter takes a fee so being able to do that directly on your own site is definitely useful.
Doing those crowdfunded campaigns on your own site. Are you using an app for that?
No. We built our own custom.
Yeah, we built their own custom platform and then basically you could back a project. and then... In Kickstarter you have to wait till the end until you can select...
For example, let's say we launch a product with 4 colors. There's no option unless you choose the colors... Kickstarter is great for someone [that]s selling a hoodie. One hoodie...
...one color. Maybe a couple colors. But when you start getting into like... We're launching new collections there. So you have different strap options, you have different colors of faces. There are a lot of different things that people want.
They want to add more straps, they want to add... It's different. I know games are super popular on Kickstarter. But it's just a game or whatever it was. It was Exploding Kittens.
My kids just told me about this game called Exploding Kittens.
I have backed a lot of games on Kickstarter. I love board games (laughs)
Right? So my kids just told me about this Kickstarter game that... They did amazing. It's called Exploding Kittens. Have you heard of it?
Mm-hmm. Yeah, I have.
Yeah. So anyway... So I feel like that's really good, because it's just a game. And then basically, when the campaign is over they just send you a link, either the backer kit or they have their own platform that they built and you just check out. Your shipping address.
I don't know if they have any upsells. They don't have any upsells during that process and then you just check out. By us, it was just we wanted people to be able to back the project, get all their information... Kickstarter doesn't give you their information until the end of the campaign.
So you spend a lot of money bringing people in, you don't know... You can't track them. You don't know what... You can't retarget because you don't know who's coming to the page.
But yeah, I agree with you. It's an early adapter. Some brands have made it part of their business. They run in parallel...
Like they'll run the Kickstarter campaigns and they run their Ecommerce. For us, I felt it's better if we build our own platform. Why should I push people to a Kickstarter campaign and have them go to a platform that doesn't exist? That's not ours?
Also, we built a very custom checkout process. So they back the project. Once they get in, they can select their watch, they go through a 5-step process. It's very easy.
We have curated straps specifically so they can build their own custom stuff. And it's really successful in the sense that we get a lot of upsells on that. They can... We have a section in there called backer deals.
So these are deals that are only specifically for people that back our projects. They get access to some crazy deals that we have because we were not a discount brand at all. We basically pulled all our discounting from the brand.
We realize that people are not buying our watches because they're getting a good deal. They're buying it because they just love what we're doing and they're gonna... There's... Yeah.
I highly suggest people reevaluate their discounting strategy. Add more value versus giving a discount. So we built our own. We felt it's better, and it's been really successful.
We've run, I think four campaigns on there, it's not going to do the $2 million Kickstarter stuff. But then again, we're not spending a huge, huge amount of money on advertising it.
So I think we've done about 2 and a half million dollars on it over the last 3 campaigns.
If you could go back in time and stop yourself from making mistakes or tell you to tell yourself to do something differently, what would you do?
Be careful of the data. The anecdotal data that you get from, like, feedback from fans or customers, I should say.
So in other words, a lot of times, you'll have... Someone says, "Hey, I really don't like this, this, and this, and this..." And everybody here in the office goes, "Oh my god, nobody likes it. Blah, blah, blah." I think you need to do... You need to do a lot of research.
I think in the past, 10 people would scream out of 1000. And then we think the whole 1000 was screaming, and it turns out, it was just 10 people screaming. And so we made a lot of changes on product changes or we did...
We added more colors or other variations, or we did a lot of stuff. From our perspective our product is not cheap. There's 6 months to build these watches. And so we made some mistakes early on, where we listen...
We love feedback, but it's got to be real, proper feedback, and where you have real data, where you're sending out surveys and you're saying, "Okay, what do you like [or] what you don't like?"
And not... What I'm saying is don't listen to the 10 people that are screaming at you because it's probably just 10 people that are just... they just scream at everything. Don't make businesses, don't make business decisions on that.
Yeah, the "squeaky wheel gets the grease". Is that the old saying there?
Now, is there anything I didn't ask you today that you think would resonate with our audience?
I think we touched on a lot of the stuff. The only thing that I think that's really, really important, I think...
We should probably stress on lifetime value as cost per acquisition goes up. With everything that's going on, whether it's the iOS stuff, or just cost of acquisition, or finding people that are interested in your products, I think you really need to add...
You need to figure out how to increase your lifetime value, how to add more value to the brand other than just delivering a product. What else are you providing?
Think about those things? I think it's really, really important to you. I wouldn't say I'm shocked.
But I'm amazed by how many people out there really love brands that take an interest in the people that buy and wear their products.
What I see a lot on the consultant side of things is... It's astounding to me that brands don't have these upsell, cross-sell, bundling strategies to try to increase LTV.
They fight so hard for that first sale and then they just go back and fight for another sale from another stranger and just ignore the fact that it's 10 times easier to sell these things to someone that they've already acquired that customer.
Well, Chaz, if people are curious about the watch. Where should they go to check it out?
For sure. If you're a watch lover out there and you're into fine Swiss watches from a brand that really cares about you and about your collection? You can go to livwatches.com
That's L-I-V --No 'E'-- watches.com and hit us up on live chat. I'm on live chat. I answer live chats. I answer the phone. People are shocked.
I'm like, "No, no, no. Everybody here talks to everybody." So we're a family here, we're passionate about the products that we build, and we really love the community that we've built around us.
Awesome. Chaz, thank you so much for coming on and sharing today.
Thank you for having me. Appreciate it. Thanks, Chase.
Alright. I can't thank our guests enough for coming on the show and sharing their knowledge and journey with us.
We've got a lot to think about and potentially add into our own business. You can find all the links in the show notes.
Make sure you head over to honestecommerce.co to check out all the other amazing content that we have. Make sure you subscribe, leave a review. And obviously if you're thinking about growing your business, check out our agency at electriceye.io. Until next time.