On this episode of Honest Ecommerce, we have Darron Burke. Darron "Don Pablo" Burke is the Founder and CEO of Burke Brands. We talk about the upside of naivety as a startup business, building momentum pre-digital advertising era, utilizing modern Ecommerce strategies, and so much more!
Darron Burke is the founder and CEO of Burke Brands, a 20-year-old specialty coffee growing and roasting company that started in a garage and now has over $100M in lifetime sales.
The company produces the Don Pablo, Pablo's Pride, and Subtle Earth Organic coffee brands, in addition to private label brands for third party CPG companies. Its own brands are sold in Costco, Walmart/Sam's Club, Kroger, and other brick and mortar locations, as well as online.
Darron has always been entrepreneurial, starting various businesses, but immediately before becoming "Don Pablo," Darron taught Entrepreneurship at an inner-city Miami High School for four years.
In This Conversation We Discuss:
Resources:
If you’re enjoying the show, we’d love it if you left Honest Ecommerce a review on Apple Podcasts. It makes a huge impact on the success of the podcast, and we love reading every one of your reviews!
Darron Burke
Always kept the quality. We don't take any shortcuts. We don't cheat. We have a very innovative and unique model for producing excellent quality specialty coffee.
Chase Clymer
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 show an amazing entrepreneur, Darron “Don Pablo” Burke, the founder and CEO of Burke Brands, most notably known for Don Pablo Coffee.
Darron, welcome to the show.
Darron Burke
Thanks. Happy to be here. Thanks for having me on.
Chase Clymer
Oh, I'm excited to chat. We rarely have guests on the show that have your experience and track record as the business started before the Internet. It's very rare to have a guest like that.
So I'm very excited to get started. So I guess quickly, just let the listeners know what's the business up to now.
What types of products are you selling? Where are you guys selling those products these days? And then we'll take them back in time.
Darron Burke
So yeah, we're not quite predating the internet itself. But really, before online products were the norm, buying online.
It was 34 years ago, I met my wife who's Colombian. And she brought me to her home country. I fell in love with her. I fell in love with her parents. And they gave me this great cup of coffee down there.
And I'd always been entrepreneurial. But this cup of coffee really opened my eyes, in more ways than one.
And I recognized the business idea. So I said, ‘Hey, let's take this coffee back and see what people think about it.’ And we did, and they loved it.
And I was a kid, I was 20, and I had no money, had no education. So I didn't start the business back then, but I started my education.
I went to coffee farms and to roasters, and went all over Latin America learning about coffee, growing and roasting. And 20 years ago, we bought a roaster, a small roaster, and started in a 1200 square foot garage.
And that's really the genesis, the whole thing. We're here 20 years later. And it's been a heck of a journey.
Chase Clymer
Absolutely. So just to, I guess, correct myself and let everyone know that I've got some notes here and I got things mistaken.
So you visited Columbia in the 80s and just kept looking at this product. But then you launched the business in the early 2000s.
Darron Burke
Exactly.
Chase Clymer
Awesome. Awesome.
So let's talk more about that education piece, visiting these farms and obviously doing sampling with potential customers.
How did you do that? Was there any rhyme or reason or strategy to how you were going to learn about this industry, for listeners out there that they know they want to do something in a certain area, but they don't know what yet.
Darron Burke
Yeah, no, it was very organic. You know, with that first trip to Columbia 34 years ago and that first cup of coffee. And I'm curious by nature, which I think is a good thing for an entrepreneur.
And I was asked to be taken to a coffee farm and I went to our first one.
And if you, for context, if you live in Columbia, you either grow coffee yourself, or your aunt or your uncle or your neighbor or your cousin or whatever. So it wasn't hard to find ourselves on a coffee farm, early on. So I sort of started that education. And then we brought Colombian brands back to the US.
Now, mind you, this was actually before Starbucks. If you look online, they'll say they've been in business for whatever it is, 40 years, but it was a different iteration–the origins of it. And it was just a whole bean shop on the West coast.
And really, nobody, 34 years ago, on that first trip to Columbia knew anything about Starbucks.
So I was telling people, ‘Hey, I want to do this thing. I want to take Colombian brands from Colombia to the U S and sell them.’
And people said, ‘That will never work. If that would work, people would be doing it already.’ And there was a lot of discouragement.
But this coffee was so amazing and we didn't have anything that I encountered in the US back then that came close to it.
It was all supermarket brands, which is another bean entirely. It's a Robusta bean. So very acidic, very bitter, double the caffeine. And it was a caffeine delivery device more than anything else. You put a ton of cream and sugar in it and you start your day.
This coffee was an Arabica bean, grown higher in the mountain, richer, smoother, cleaner finish, half the caffeine, doesn't make you nervous and jittery. So it was really, really very special and I recognized that and I started bringing it back and family and friends had the same experience that I did with it.
So I knew this was gonna be big, but like I said, I didn't have any money and I was young.
And so I stayed with it. I did a lot of other things. I had an exhaust system cleaning business in restaurants for a bunch of years and did some other entrepreneurial things.
And 20 years back, I started it and bought the roaster and that's really how we did it.
And to your question, how'd you get your customers? It was not easy because I'll tell you the other key ingredient, the key element that I had that was extremely important and the business would not exist if it wasn't for that thing, and that was ignorance.
I was very naive. Extremely naive. And you know why I say that is because to this day, 95% of the global at-home coffee industry is controlled by only four companies, right? So they're billion-dollar food conglomerates that keep out all the other coffees.
And we started in that environment. And I had no idea.
So, you know, I, for example, I would walk up– we're in Miami and walk up Biscayne Boulevard, which is a long street with a lot of restaurants on it–and I'd have samples and I'd say to the restaurant owners, ‘You wanna buy my coffee? You wanna buy my coffee?’
And most of them said no, and some of them were insulted that I wanna leave samples with them.
But one restaurant, a Greek restaurant, said, ‘Yeah, I'll buy your coffee. It's great coffee. All I need is these brewers, these satellite stations, these warmers, these airpods.’
And I'm like, what? I was like, oh yeah, all the big companies, they do that. They give you all this free equipment and 10 cases of free coffee. And then they sign them up on a contract for two or three years. So they lock them up.
And these are the lower tier below those big giant companies that are doing 100, 200, $300 million. And that really opened my eyes.
And I had a friend that worked for one of those companies. He said it was a 10 month formula. So they'd spend all that money in a restaurant giving all that free stuff. And they wouldn't make a dime on the coffee for 10 months later.
Now we started in a garage with no money, so there was no way we could compete with that. But you know, I had already started it. And when I start something, I don't quit. And I was very faithful and we ended up getting into Costco.
So that was a miracle and how we did it was meeting a local marketing person from Costco in the chamber of commerce events.
And they said, ‘Hey, if you want to do a show, we've got this charity event and you can't sell the coffee, but you can show customers and give customer samples and that type of thing.’
So we got a bunch of Colombian girls. We put them in these nice hats and you know, ponchos and stuff. And we made a big buzz. A lot of people loved it. They went crazy over it.
We had them fill out all these comment cards, a big stack of comment cards. How great the coffee was and bring it in and all that stuff. And we sent it to the region over here in the Southeast region, and nothing, right?
And then we called them every week. My sister-in-law actually called them every week for a year.
And finally they said, ‘Listen, this is too much. What do you wanna do?’ And we said, ‘Hey, give us another road show and we'll see if we can make it work.’
So we did a road show in that same location where we did the charity event and we blew it up. We sold more coffee in the history of coffee road shows in that location.
And they said, ‘Wow, go up to this other location up to Boca,’ because, you know, this is a Latin market down here in Miami, you know, we were sort of a Latin brand. And they said, ‘Go to Boca,’ a whole different demographic.
We went to Boca and we sold even more coffee, broke another record there. They said, ‘Wow, okay, South Florida, maybe.’ They said, ‘Go up to Charlotte, North Carolina,’ went up to Charlotte, North Carolina, I’ve never been, beautiful town. Again, sold crazy amounts of coffee up there.
Then they said, go to Winston Salem, North Carolina. I had never heard of it. And we went there, the doors opened, nobody in the building. We’re like, ‘Oh no, they don't really want us. Maybe they're setting us up for failure, trying to get rid of us.’
But we sold so much coffee in that location. We had detox centers coming in and people were on their phone calling other people and they were coming in and they just went crazy over the coffee.
So we sold so much coffee in that location. They gave us eight warehouses.
And we built those eight warehouses up to the rest of the region over time. And for the meantime, we got into the other warehouse club, Sam's Club, which we've been with for 17 years and built that up magnificently.
It took a lot of hard work, but that's how we got our customers. We didn't have the benefit of digital marketing and social media back then, it all predated that. In fact, it predated selling groceries on Amazon.
So when Amazon came along and they started selling groceries, we went hard into that. And we got some good people that really understood digital marketing. And we were able to pump that up to like a million dollars a month.
And it took a few years, but the growth was just up and up and up and up. And now we've got our own website where we're doing about $3 million on our own website. And it's… things change and it's a constant challenge to learn and find people who really understand digital marketing.
And now with AI, it's another challenge but a really great opportunity. So yeah, we've gone from legacy brick and mortar stuff to blowing it up in the digital space too.
Chase Clymer
That's amazing.
So there's a lot of nuances to that story. And so I want to talk about maybe necessarily the timeline.
So when do you...Let's just call it the first big break. When were you getting these first massive retail orders that are really helping blow the business up?
What year was that compared to when you started to look at these other channels, say Amazon, or your direct consumer through your own website?
Do you remember what years these were happening?
Darron Burke
Yeah. So we really got our first order in 2004. And it was from TJ Maxx. And it was the day after Hurricane Wilma totally destroyed South Florida.
And, you know, we had a broker that was working on it. I was in a condo and the whole building was shaking and light poles outside were falling to the ground and stuff. And when the storm passed, we got up and we were going to go check on the roasting facility, which was, you know, very small in a garage.
We didn't know if it was flooded, if it still had a roof or whatever, and I got a phone call. And it's like, ‘Hey, they want to buy from you X amount of dollars.’
And it was a huge order. We just had a tiny little roaster. I'm like, ‘Hey, we don't even know if we have a roasting facility yet, will they give us more time?’ And they’re like, ‘No, no more time. If you don't deliver within these 30 days, then they'll never buy from you again.’
So we went to the facility. Fortunately, thank God, it was in perfect condition. No problems at all.
But the problem was we had a tiny roaster and only a few people, a few employees. So I had been a teacher at a local high school in Hialeah down here for four years previous to this. And it was a fluke, but I was doing it. And it was, you know, I was teaching entrepreneurship.
So I called there and I said, ‘Hey, do you have any kids that need community service hours?’ And they’re like, ‘Yeah, sure, where do we send them?’
So I got like 20 kids that worked for community service hours to produce this order. And it went all over the country. So we had some exposure right away for our brand on that channel.
But then like I said, we got that opportunity with Costco and that was like a year later. And a lot of miracles by the way, along the way, just the planets going in alignment and one miracle after another. Not that it was easy, it was very hard.
So they gave us eight locations and they had told me,’Listen, if you do X amount a week per location, you'll stay long enough until something else cool comes along and then we'll replace you. But if you do X more, which is double, you're going to stay for a long time.’
So we went all in and we spent all kinds of money that we didn't have. And we were literally working, you know, 18, 19, 20 hours a day, easy. I've done plenty of 24 hour days, just preparing for these things and standing on concrete for 10 to 12 hours a day in these warehouse clubs.
And we did that for a couple of maybe 18 months, two years. And then they gave us, you know, some more warehouses and then some more warehouses. And my wife and I have given over a million cups of coffee to people over a 10 year period.
And we know this because we did demos and road shows for every weekend, four days a week for 10 years. And we used to go in there with cases of cups, there were a thousand cups each, and we would at least go through one of them.
And usually like on a Saturday or Sunday, you go for three or four cases, go through three or 4,000 cups. So if you do the math, it's well over a million cups that we personally handed to people.
And I don't know if you can tell yet, but I talk a lot. So I would tell my story to every single person, our story to every single person that took a cup of coffee. And listen, it worked after 10 years, we get to be in business and we're competing on the shelves and also on Amazon and other places head to head with these giant companies that sell hundreds of millions of dollars a product. It was hard, but that foundation of the brick and mortar and the really hustling and the working really hard is what would allow us to compete more easily in the digital space.
Chase Clymer
Hey there, merchant.
Are you tired of trying to navigate the wild world of ecommerce on your own?
Are you looking for a partner to help you achieve your goals?
Look no further than the Shopify Plus agency, Electric Eye. Our team has a proven track record of helping our clients make millions with strategic design and development.
Whether you're migrating from a legacy platform to Shopify, designing a new theme for your store, or just looking to optimize what you have, Electric Eye is the perfect partner for you.
Electric Eye are true Shopify experts.
Not only is our Shopify knowledge unparalleled, but we have partnerships with all the best tech in the Shopify ecosystem.
And don't worry, we're easy to get a hold of. Our clients rave about our fast communication.
So here's the deal, if your ecommerce business is doing over $1 million dollars a year you can receive a complimentary Shopify Diagnostic from our team of experts.
That's free, personalized, strategic recommendations to improve your store and grow your business.
To get started, head on over to electriceye.io/connect to schedule an intro call with one of our experts.
That’s electriceye.io/connect.
Today's episode is sponsored by Intelligems, the ultimate A-B testing and profit optimization platform for Shopify merchants. You're investing tons of time and money to drive traffic to your store, but are you doing everything you can to convert that traffic into profits?
With Intelligems, you can stop guessing and start making strategic decisions. Intelligems platform enables you to A-B test everything from themes to pricing so you can understand what makes your customers tick and click.
Whether you're tweaking your UX, testing prices and offers, or trying out different shipping rates, Intelligems provides real-time insights that can directly influence your store's profitability. Join
the ranks of over 1,000 Shopify stores that are already maximizing their potential with Intelligems. Setup is quick, and the results are undeniable. If you're not experimenting, you're leaving money on the table. It's that simple.
Elevate your Ecommerce strategy today. Visit Intelligems.io or Honest Ecommerce and use code HONESTECOMMERCE for 10% off your first month. You can also find Intelliems on the Shopify App Store and get a 7-day free trial.
Chase Clymer
Well, I think each one of those cups of coffee–if you just want to do the math–cups of coffee that you personally handed out to potential customers–and it's free samples, mind you–one cup of coffee equates to almost a million dollars in sales.
You guys have done over $100 million in lifetime sales for 1 million cups of coffee. I think that's a good trade-off.
Now, if you could tell an entrepreneur right now, it's like, go give away a million free samples, you'll make $100 million. I think most people would do that.
Darron Burke
Well, I never thought of it that way. That's very interesting. But let me tell you something.
Hard. Hard. Hard. Hard. Hard.Hard. I'll say it 10, 24 times, it was hard, but we weren't going to give up.
And we didn't have the benefit back then of having the opportunity to sell online. So it's with Amazon. Amazon has made a lot of millionaires, right?
So a lot of the younger people don't know what it was like before Amazon. So it was a very small group of manufacturers that had a lot of money that would one: keep everybody out through exclusive distribution agreements and non-competes and all these other things.
But two: have the money to do all the outdoor advertising, to advertise in all the magazines, to do the commercials.
We had four channels. When I was a kid, we had four channels. But when we started this, we didn't have many others, the broadcast media. So that was very expensive. So it was really hard for a smaller company to compete with the bigger companies in any meaningful way.
And that genie came out of the bottle not that long ago. Really, maybe 15 years ago.
Chase Clymer
Absolutely.
Let's talk about the transition to what... These days, everybody calls it omnichannel. But it's just like selling your customers wherever the heck they want to buy from.
So did you guys launch on Amazon or your own direct-to-consumer website first? And what was that learning curve like?
Darron Burke
Well, so it was a learning process for sure. And we had our own website long before Amazon, but we didn't do too much on it. Iit wasn't very robust as far as the shopping cart was concerned.
And there was not a lot of opportunity to get out there. I mean, you had Google ads and you had Facebook and stuff. And it was just… in the very beginning, and I would not be shy about telling people this, the cost benefit equation for advertising on social media was just not there–it did not pay. It took a lot of time and a lot of effort for very little return.
So as their sort of analytics and their progression, I'm talking about digital channels and digital platforms and social media became better and better and more advanced. and it became better. And somewhere around that time, we were introduced to Amazon.
And we started with Amazon and we had some people that were very good. And mind you, this was back in 2013 when grocery was relatively new. So there was not a lot of competition.
It was sort of the first mover advantage or second mover advantage type situation that we benefited from. Timing is super important and a lot of things.
First, our own website. We didn't do much then on Amazon, and Amazon was sort of a rocky road for us, with keeping it stocked.
Especially with all kinds of…lately with supply chain issues, and after the pandemic and sales absolutely went wild during the pandemic. But after that, there was a lot of disruption in the supply chain.
So what happened was, we ran out of stock on Amazon and people love our coffee. We have this over 70% customer retention rate. So we've always kept the quality. We don't take any shortcuts, we don't cheat. We have a very innovative and unique model for producing excellent quality specialty coffee.
And because of that, people were desperate to find the product when we ran out on Amazon. So they found us on our own website and we blew up our own website. We tripled sales within a very short period of time, which, like I said, we're doing 3 million now and we're actually trying to slow it down a little bit.
We keep raising prices, but we keep getting more customers. Kind of a good problem to have, as they say, I guess.
Chase Clymer
Absolutely.
Now, would you say that because of the growth of Amazon, it gave a trickle down effect to the growth of the direct-to-consumer website?
Darron Burke
Yeah, it's an amazing dance really between not only those two, but also our brick and mortar sales.
We are sort of intentionally stocking one and not the other in a certain period of time so we can increase sales at one or the other depending on what the best thing to do is. And I think it's an interesting strategy.
You think one would cannibalize the other, but we always end up with more than we started with. So I think there's definitely an opportunity to… I don't want to say use one against the other, but kind of stock one in one way and some brands or some pack sizes or some favorite sizes in one and not the other.
Chase Clymer
Yeah, I've seen a lot of interesting information around... This would be supporting the idea of omnichannel.
There's a lot of people that want to do everything right on their own website and they don't have such a big wholesale component; I'm just going to call it that for lack of a better term.
Like your business does, they don't do Amazon. They're doing it all on their own website.
But I've seen recently that just by turning on Amazon or these other channels, and not even increasing their spend or diverting traffic, these people are already looking for this product on that market already just because they are aware of it, but that's where they like to shop.
So I think that if you're spending a boatload of money on ads on either platform, having the other one still have inventory, you'll see this tick up in sales just because of the awareness of the ads and the attention that you're generating.
Darron Burke
Yeah, I agree. You definitely have people that prefer one channel over the other. But there's also people that either shop for price or shop for something particular and like to go back and forth from one to the other.
So either way, it works for us. As long as they end up at our product and buy it, we're loving it.
Chase Clymer
Absolutely. So let's talk about what's going on now. You guys are doing some really interesting stuff. I want to touch on this because I always think it's a really interesting thing.
We're doing a bit of private labeling. And I've never really asked someone about how this can be kind of a revenue channel for a business.
So can you give me a crash course on what that is and how that can be a profit center for a business building upon the systems that you already have?
Darron Burke
So this is one of the... The thing I would say is the absolutely most exciting thing, not only for me but it should be for everybody because something amazing is happening. And what happens is it happens so slowly,and like I said, if you're a younger person and you don't have the benefit of a longer time horizon, you don't really get it.
But if you're a manufacturer of a product, you have an opportunity for the first time in the history of the world and the first time in the history of CPG products to leverage social media and digital channels.
You know, there's all these influencers. All these influencers that have all these huge audiences, I mean, you know Mr. Beast, right? Once you got 25 million subscribers or something like that.
Chase Clymer
The most, there's so much.
Darron Burke
So the numbers are staggering. And all he has to do is say, ‘Hey, buy this chocolate bar or go to this burger place.’ And he's got customers, just like this, from making a bunch of goofy videos. Nothing against him, he's brilliant, obviously.
So that's really the tack that we're taking now, to find alignment with these influencers and influencer organizations in trying to get them to do a private label for themselves. And we make that very easy, and it's a passive recurring revenue stream for them.
We'll even design the bag for them. We'll purchase everything. We'll roast the coffee. We'll pack the coffee and we will fulfill the coffee and they get this money for just going on their channel and drinking the coffee and saying how great it is. And all of that.
So we've already got one customer who is absolutely blowing it up and not doing anything other than they were already doing and just making tons and tons of money from doing this.
And it's super easy for us. It's a win-win all around.
Chase Clymer
Absolutely. It's amazing.
And there's something we said about selling your sawdust. It's like you guys have already built these systems. You already own the equipment. When it's not running, you're not making money. And there are... It's something... Think outside the box about how you can monetize the things that you've built other than just your product within your business, and you can find so much more margin.
Darron Burke
Definitely. Yeah. I mean, it's all about adding value, right? Always. And in this case, you're adding value for somebody. You're providing something that wasn't there before.
And the fact that it's coffee, which is something that people drink every single day, it's a fast moving consumer product, they call it. And ours has got such a high customer attention rate.You keep these customers.
So you're selling subscriptions, right? Then the people say, ‘Hey, I love this influencer. Let me try it.’ You sign up for a subscription and the coffee just comes once a month or once every two months or whatever you do.
And the money just keeps rolling in. And all they have to do is put themselves on the camera and say how great it is. And it's really an easy thing to get into. And there's literally millions of dollars attached to it.
Chase Clymer
Absolutely.
We've talked all about this amazing coffee. So before we go here, I want to make sure that you can tell people if they want to go try, obviously, there's Don Pablo Coffee, but there's a few other brands.
Where should I go to find these things? Where should I go to check them out?
Darron Burke
So if you're close to a Costco, go there. Sam's Club, same thing. And of course, we've got Amazon and we've got donpablocoffee.com. They can find us. If you Google Don Pablo, you'll find us for sure.
Don Pablo Coffee, don't just Google Don Pablo, then you get into some weird stuff.
Chase Clymer
Absolutely, Darren. I can't thank you enough for coming on the show today, sharing your story and your insights. I'm sure we'll have you back on soon.
Darron Burke
I really appreciate it. Thanks for having me.
Chase Clymer
We 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.
You can subscribe to the newsletter at honestecommerce.co to get each episode delivered right to your inbox.
If you're enjoying this content, consider leaving a review on iTunes, that really helps us out.
Lastly, if you're a store owner looking for an amazing partner to help get your Shopify store to the next level, reach out to Electric Eye at electriceye.io/connect.
Until next time!