On this episode of Honest Ecommerce, we have Kristen Pumphrey and Thomas Neuberger. Kristen and Thomas are the co-owners of California-based fragrance brand, P.F. Candle Co. and authors of “At Home with Fragrance.”. We talk about setting yourself apart to create business value, preparing for competitive Ecommerce sales, finding motivation from team successes, and so much more!
Kristen Pumphrey & Thomas Neuberger are the co-owners of California-based fragrance brand, P.F. Candle Co. and authors of “At Home with Fragrance.”
Now a 63-person company, P.F. Candle Co. started as a one-woman Etsy shop in 2008 out of Kristen’s second bedroom. As fragrance experts, Kristen and Tom have scaled the business over the course of several years on their own with no formal business degree - DIY is at the core of everything they do.
Today, products are sold in thousands of stores worldwide and their two brick and mortar stores in Los Angeles and San Francisco. Despite the company’s growth, P.F. Candle Co. still proudly makes their products in-house, pouring up to 3,500 candles a day all while modernizing the craft of candle making.
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!
Thomas Neuberger
What I’ve learned about economics and running a business is actually, the more unique you do things, the more of a reason you should exist.
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 bringing to you not one, but two co-founders from P.F. Candle Co. Please welcome to the show Kristen and Thomas. How are you doing today?
Kristen Pumphrey
Good. Thanks for having us.
Thomas Neuberger
Yeah, very good. How are you doing?
Chase Clymer
I'm doing well. Thanks for asking.
So for those that are unaware and can't put together context clues, what are you guys selling over there at P.F. Candle Co.?
Kristen Pumphrey
Yeah, we do sell candles. Candles, home fragrance, incense, re-diffusers, room sprays. Basically, anything that's going to make your home and your atmosphere smell really good, we make it and we sell it.
Chase Clymer
And I can attest they smell amazing. They have been very nice and sent me over a care package and there's one right next to my computer right now, making it smell great.
Now take me back in time.
Where did the idea for this business come from? How did this become part of your life?
Kristen Pumphrey
Yeah. So I started P.F. in 2008. And at the time, Etsy was really just starting to take off. I became aware of that. I had always loved to make things heavily into craft classes as a kid. So I was working in publishing at the time at a craft title, so they did a lot of knitting and crochet and this was 2008.
So big recession and the magazine folded and I ended up losing my job. And I remember my boss sitting me down and saying, “Well, what are you going to do now?”
And I just said, “You know what? I've been writing about all these people who are makers and making a living selling handmade goods and I want to try and do that.”
I left New York, I moved to Austin, then I started... Well, what is now P.F. Candle Co. But then it was known as Palm Freed. So I started as a blog and as an Etsy shop and selling at markets. And that's actually where I met Tom, who now obviously is my life and business partner.
Thomas Neuberger
Yeah. We meant nothing to do with the business that we just met at a bar.
Kristen Pumphrey
Classic. Iconic.
Thomas Neuberger
Yeah. Right. Exactly.
Chase Clymer
Amazing.
Now, let's talk about the start of the business. Did you launch on Etsy? Is that where you got things first going?
Kristen Pumphrey
Yeah. I would say my first launch was really doing in-person craft fairs. But Etsy was such an incredible marketplace for us at the time because there's a lot of candle companies now that sell online. But at the time, I couldn't sell a candle, I think, for six months after I initially launched my candles online.
So Etsy, in addition to essentially our only website, it also was a marketplace. It would offer discoverability. It was a really, really great tool to launch there. And we didn't start... We started with a Squarespace and now we're on Shopify. A couple of years, I would say probably not till 2012 is when we started our own website. So about five years just running off an Etsy shop.
Thomas Neuberger
Yeah, I think the reason why I worked even though after six months of not selling candles is that it really lends credibility to artisans.
And once people started taking a chance and reviews got up, because that was a big part, until the reviews got up on Etsy, no one was buying a single candle. And then the reviews came in and they were overwhelmingly very positive. So I think that encouraged more people to buy it.
And we've always had a very welcoming customer satisfaction policy. So I think people were always willing to purchase the candles.
Chase Clymer
That's amazing.
Obviously, you are doing in-person events. I'm assuming you are building your email list at these things. You're also growing on Etsy.
What made you decide to make the leap into something like Squarespace and build your own website versus just continuing what you were doing with Etsy?
Kristen Pumphrey
I think it was the fees.
Thomas Neuberger
Yeah. I was going to say it's the fees. And I know nowadays, maybe they're not so high. But back then, they were a modest chunk of each transaction. Very little compared to Amazon but back then, moving to Squarespace was significantly cheaper for us.
Kristen Pumphrey
You know what? Also, Etsy, as I said, was essentially my marketing tool as well. And once we started, we were super early to Instagram. It was actually part of our success story. We got discovered there by West Elm. And then Instagram became our main marketing tool, and we used it all the time.
So creating the extra channel of having the other marketing tool and not just being Etsy allowed a path to open for us to have our own website and save a little bit of money on fees.
But fees aren't something to necessarily be scared of. You just have to pack it into your overall pricing because we're on Amazon now and we have to consider those fees as well. And I think that if the platform is going to offer either ease for your customers to purchase or discoverability, they can really be worth it there.
Thomas Neuberger
Yeah, I think also at the time, we were concerned that we didn't meet the qualifications of an Etsy artist because it wasn't just Kristen making the candles anymore, or me. Because first it was Kristen making candles, then I made the candles. And then I hired an assistant to help me make candles.
And then we were afraid when we got to five people that we weren't an artisan anymore, couldn't be an Etsy seller. But they changed that qualification, I think, around the time we were struggling with that. But still, we weren't sure if that was the right place to be for us.
Chase Clymer
Awesome. And so then you launch on your own standalone website. And I think that's what a lot of our listeners are doing as well.
What was one of the biggest learning curves when you launched your dot com and planted your flag there versus what you experienced with the marketplace?
Kristen Pumphrey
This is a good question. Squarespace was actually super easy for us in the beginning because I had super basic HTML skills from my early days on GeoCities. So that was very, very friendly.
When we shifted to Shopify, it quickly went beyond my HTML skill set. Then we started to have to figure out what was worth the purchase cost of the monthly fees of integrations and apps and add-ons and stuff.
So I would say that Squarespace, we just outgrew it because we wanted those apps and we wanted all the plugins. And then with Shopify, you have the other end of it that doesn't have as much integrated. You have to get those add-ons. So really figuring out what was right for the business and what was worth the investment.
We're independently owned and operated. So we're pretty scrappy at every turn, you know?
Thomas Neuberger
Yeah, I'm trying to remember if there was anything in particular that was a challenge with Squarespace other than it was just a very simple website that was not too complicated. We didn't have a lot of control over it. We didn't have the ability to plug in our mail servers. We didn't have all the other plugins that we could do that we were looking for.
And then I think we were also concerned with maybe some of the marketing for Shopify that maybe our website would crash if we had too many people. Black Friday, Cyber Monday. So I think those may have been some of our concerns or limitations with Squarespace at the time.
Chase Clymer
Let's talk about getting those people to the website that would help with crashing it if you had an overhaul success. What were you doing? How are you driving that attention to the brand?
Kristen Pumphrey
Yeah. Now, I would say that we have a super robust email marketing plan that really targets our existing customers and obviously, you can get people sort of onto the email list using the pop-up. That's so standard–that pop-up when you first come to the website. We've recently integrated a small SMS program. It's growing and it's a really, really interesting new chapter for us.
You can't understate the social media aspect of just general brand awareness. When I think about sort of what's bringing people to the website, attribution is so murky always with digital marketing. You can say, “Oh, I know that this many people click through the email”, but ultimately, it's about the whole ecosystem that you build.
And as a young person starting out, what is so, so important is taking advantage of things that are free to you. And social media, for the most part, other than the time it takes, your time is what you're paying, right?
But Instagram, getting a break on Instagram and getting a lot of followers on there early on was so key for us.
So I think now, seeing sort of these new business owners using TikTok in the same way that I might have used Instagram back in the day, this is really, really inspiring because you just see that they're making the most of the tools they have available.
Thomas Neuberger
Yeah, I think it was all social media because we're early adopters to it.
If there was anything else, it might have been the fact that candles didn't do well online like we were saying initially, it wasn't something people naturally went and trusted. People were doing it. They do a lot more now than they did then. The marketplace has changed a little bit more.
So one of the ways that we got that business or interest in is we had a whole bunch of wholesale accounts. We were selling at Urban Outfitters, CB2. We had, maybe during the Squarespace days, 500 to 1,000 different small doors that we sold to, like independent accounts.
And I think once people would find us there, they would just Google us and since we're a pretty recognizable name. They would find us and find our website.
Chase Clymer
Hey, Shopify store owners. Have you ever wondered if your store is leaving money on the table? Imagine increasing sales without spending more money on ads. Sounds too good to be true. Well, it's not.
I'd like to introduce you to StoreTester. StoreTester is a done-for-you conversion rate optimization service for Shopify merchants.
Could your store benefit from increased conversion rates, higher average order values, and improved revenue per visitor? StoreTester could be the perfect partner for you. From ideation to implementation, this full service A-B testing service takes all of the guesswork out of improving Shopify stores.
Stortester does all the work for you while offering month-to-month transparent fixed pricing. It gets even better. They believe in their service so much they're offering the first test for free for qualified merchants.
Let me repeat, the first test is free for qualified merchants. Curious to see if you qualify for a free test? Reach out today. Visit stortester.com to schedule an intro call.
That's www.S-T-O-R-E-T-E-S-T-E-R.com. Schedule an intro call today to see if you qualify for a free test.
Hey everybody, today's podcast is brought to you by Intelligems, the ultimate profit optimization tool for Shopify merchants. I'm telling you this, obviously, you know I own an agency. We use Intelligems when we're running split testing and CRO stuff for all of our clients.
Are you looking to maximize your profits? IntelliGems offers data-driven solutions to optimize your content, prices, discounts, and shipping rates. Join over 500 happy clients who have seen significant improvements.
With Intelligems, you gain control over your Ecommerce economics, boosting your profit per visitor by an astonishing 36%.
But that's not all. Intelligems users report a 54.62% increase in revenue per visitor and a remarkable rise in conversion rates.
How does Intelligems do it? Through a suite of tools that allows you to A-B test everything on your Shopify store, from landing pages to product prices and shipping rates.
Imagine testing new layouts, offers, even a new Shopify theme with ease.
We're testing a new landing page for our client on a new theme versus an old landing page on their old theme right now.
Intelligems empowers you to find the perfect price point for your products and optimize your shipping strategy.
But there's more. Boost your average order value with customized campaign offers and discover if your customers prefer free shipping or a lower list price.
With over $100 million in incremental profit generated, billion transactions ran through their software. They have over 400 million shoppers that have gone through their tests.
Intelligems is not a tool. It's a game changer for your business.
Are you ready to transform your Shopify store's profitability? Book a demo today at intelligems.io. Empower your brand to reach new heights.
Again, that's intelligems.io. Intelligems, giving superpowers to your customer acquisition, retention, and overall profitability
Chase Clymer
Absolutely. Now, how has that grown these days? You've obviously got your wholesale side of the business and your direct-to-consumer side of the business. What would you say is the mix these days?
Thomas Neuberger
Of our business? It's probably 50-50. During probably the heights of COVID, it might have been closer to 60% direct-to-consumer and 40% wholesale because they were closed down and people were ordering online.
It's balanced out to half and half. And prior to half and half, we were running maybe 15 to 20% of our sales direct to consumers. So it was really that COVID bump and people moving more to Ecommerce for their daily purchases that have made that mix for us.
Chase Clymer
Now, Kristen, do you have any tips for women in this space who want to be entrepreneurs?
Kristen Pumphrey
Oh my gosh. Reach out to your mentors and reach out to your peers. I think that is something that's so accessible. You can just slide into someone's DMs and be like, “Hey, you do really cool stuff. Can I pick your brain for an hour?” And I think that you'll be surprised how many people will say yes to that.
It's always good if you're asking someone, “Can I pick your brain for an hour,” to sort of offer, “Hey, I'll send you a candle or I'll send you something to value your time.”
But the peer and mentor relationship has been so valuable to growing because you can reach out to a friend or you can reach out to a mentor and just say, “Have you been through this? Have you experienced this?” And having someone in a similar position to bounce ideas off is so crucial.
Chase Clymer
That's amazing. Thanks for sharing that. Now, obviously, from humble beginnings, where it was just you and Tom and then you had a few assistants pouring, now you're up to a 63 person company.
Kristen Pumphrey
That's correct.
Chase Clymer
What would you say were some of the biggest learning curves along the way?
Thomas Neuberger
The biggest challenges and learnings or surprises, I guess, is managing people. I don't know. I think Kristen would say one of the reasons why you start your own business is because you don't want to be managed and you want to do it yourself. So I think when you come with that mindset, it's very hard to all of a sudden want to manage people.
I think it's easier for Kristen than me because, I mean, a lot of this is her vision because she made the product and she's very specific about it.
So I think that one of the biggest challenges is just the human relations of it all. And just kind of getting along with everybody. I don't know what else.
Kristen Pumphrey
Well, it's funny because you become an entrepreneur to work for yourself, right? But then if you're so lucky to be able to scale the business and employ people, then suddenly you're working from nine to five.
And so many people quit their jobs to start a business to not work at nine to five. So it's sort of this interesting dynamic as you think you set out to do one thing and then you actually set out to... You're like in the system. So that's been a very interesting dynamic.
But Tom and I always think that we don't have to do things like other companies. You can use what other companies do as a benchmark or as inspiration but by no means do you have to or should you follow the blueprint that another company set. Everyone's going to have different value sets. Everybody's going to have different resources available to them.
I would second what Tom said about the management stuff. My last job I had was a host at a restaurant and I went from that to an Etsy shop to now running this company. But I have been running the company and employing people for 10 years. So I feel like I know a little bit more about what I'm doing. I feel more confident now.
But that was definitely a challenge because we went from a group of peers to suddenly, we were the bosses.
Thomas Neuberger
It was very hard. I was going to bring up the point where you said that we don't have to do what other people do. That's actually very hard for people to understand, I think, because a lot of people, when they work for a company, tend to work for these large corporate companies who have very specific ways that they do it.
Maybe the people who run the businesses got an MBA at a prestigious school that tells you how to run a business. But what I've learned about economics and running a business is actually, the more unique you do things, the more of a reason you should exist.We exist because we do something differently than someone else.
If someone else did something exactly the same as us, then our necessity for existing is not quite there. If another candle company made candles the way we did or made it look the way we did or had a staff train the way we do, then we would be competing directly with someone exactly like us. And the reason why a customer would like us wouldn't really be there. So I think doing things differently is actually a very important part of running a business.
Kristen Pumphrey
Yeah. But you know what I was just thinking is that the most challenging part in learning to be a manager has also been the most rewarding part. It’s getting the opportunity to work alongside such incredible people that inspire me.
When someone on my team does something that I'm like, “Hey, here's an idea,” and then they just one up and like, “How do you go here?” That's just so rewarding. And it's given us... Just like having a kid gave us so much motivation to keep working really hard.
Having the team, that's my motivation. I'm like, it's 63 people that I need to provide for and I want to give them a good living. So it makes sense that it would be the challenge but also the reward.
Chase Clymer
That's amazing. Now we're recording this in August of 2024. And obviously on the horizon for everybody is Black Friday, Cyber Monday and the holiday sale season.
How much are you guys thinking about that? And what are some of the things that you're kind of keeping in mind as we navigate the Ecommerce landscape this year?
Kristen Pumphrey
Well, I do have my planning meeting coming up next week. So I'm thinking about it quite a bit. We always start to get ready in August, both with preparing the products and making the products for it and starting to figure out what our promotions are going to be. We have really scaled back the number of sales and promotions that we do.
As an independently owned brand, we realized that we were really robbing Peter to pay Paul. And when we would run these sales just to stay competitive with other candle brands or other companies doing sales at the same time, you get the sale then but you're getting it at a discount. And you're taking inventory away that could be sold at full price later on. And right now, when all of our costs from wax to jars to labels, everything, rent, everything's gone up.
We have to be really conscious of the fact that we can't discount it too much. So we have two sales a year now, unless there's sort of like a random promotion thrown in. So we really look at this as like, this is our Super Bowl Black Friday, Sunday, Monday for all these e-commerce brands. And you definitely have to stay competitive there.
But we play around with the length of the sale, we play around with whether it's a blanket discount or we're discounting based on available inventory. So every single year, we create a plan and then we do an AAR and after action review.
And we're looking at what worked, what didn't, what do we want to try differently next time? So we just try to stay super organized and implement any changes rather than just repeating the same formula every time.
Thomas Neuberger
Yeah. I mean, I've been thinking about Black Friday, Cyber Monday, and I'm hoping this works out for me for, uh, since January, February.
Kristen Pumphrey
Thomas’ the CFO in addition to COO.
Thomas Neuberger
Yeah. So for my teams, one of the things I've been talking about, and at least what Kristen was talking about with the promotions and stuff, was one of our biggest challenges in the last quarter was our inventory. It was pretty much the summation of everyone that we could have done better if we would have had the inventory for everyone.
And so one of the things I saw was that we spent a lot of time discounting products to hit sales goals. But we were losing margin and we were selling at a discount and we were doing more work to make less money. And I was like, “Let's halt that. Maybe our comps will look bad for the first half of the year.”
Kristen Pumphrey
They did.
Thomas Neuberger
But I'm going to hold... Yes. “And I'm going to hold steady on you guys and tell you this is the right way to go, that we're going to hold this inventory: Keep it, make sure we have a good amount of inventory so we can make the right decision when it matters most, which is to sell candles. They're giftable. People like the candles during the colder months. So Q4, Black Friday, Cyber Monday is kind of our showtime and we want to make sure we're ready to make the decisions we want to make then.”
So we've been planning for a lot of this and making slight decisions that we know will affect it later on since the beginning of the year. Though our official planning, like Kristen said, starts in a week or so.
Chase Clymer
Absolutely.
Now, you were talking about margins and how that affects things as a whole. And it's funny, I have this concept in my head and I'm gonna share it with you and I want to get your feedback.
There's 3 stages of Ecommerce, maybe 4. But there's first, the startup stages. How do I get to $1 million a year? What can I do to do this? And that's all that really matters. And then there's, “What will get you there wouldn’t get you to, say, $10 million a year.” That's a whole different mindset. And that's a lot of efficiency and processes that you're building in place.
You're probably replacing some things from that first tier into this one. And then after that, it's this kind of where it's like the math matters so much from the cost of goods to the margins to the acquisition cost. That's really how you start to get into these larger and maybe enterprise-y or large medium sized business areas of things is that $10 million plus is it's all about the numbers.
I guess my question to you, would you agree with that analogy? And then I have a follow up after that.
Thomas Neuberger
Well, weirdly enough, when I started taking over some of the sales management, one of my first goals in 2017-2016 was to get our website to $1 million. So I 100% agree with that. I was like, “Hey,” it was like a random goal I had. And everyone's like, “Why is that your goal?” And I'm like, “I don't know, man.
Chase Clymer
It's the 8 figure, sorry, that million dollars… It's everyone out there that listens to the show. It's like they just want to break that because it's just this weird number.
Thomas Neuberger
Yeah, I mean, I guess it's just your first sign of success because your website is a millionaire, I guess?
Kristen Pumphrey
Well, the meanest thing, I think, I remember someone said this to me. It was like a fragrance company and they're coming to meet with us. They go, “Oh, the first couple million are the easiest.”
And I was like, “With respect, how could you say that?” But it's exactly what you're talking about there is you're in such a different mode when you're just first growing it versus the maintenance of the growth.
Thomas Neuberger
Yeah. And I don't disagree with you about your second part too, because what you find happens is that if you don't care about margins, and you don't care about how you're doing it, you can find you can do a lot of work that doesn't feel... I mean, fulfilling is the wrong word, but it doesn't feel like you're going anywhere?
Because if you're just moving product, and since we make our product, we think about it a lot more. It's not just sending a PO to a manufacturer who sends us a product. I think about the time that we have to spend making the product. So I'm like, if I'm just moving through a product, I'm making these people sweat to make candles. What's the byproduct of that? What's the reason why we're doing it?
So yeah, you want to hit that goal, then you want to make sure you hit that goal with... You're hitting it well and that you're making sure your time is spent doing the things that matter.
Chase Clymer
Absolutely.
And it's wild how it just gets to… Just like how long does it take for the dollar that you invest in the company to come back as more than that dollar that you invested in? That's like the whole name of the game.
Thomas Neuberger
Yeah. I mean, I think about it all the time because as we were growing, our margins were shrinking over the past couple years. And I'm just like, we could probably do less work. It would be easier if we just focus on doing things right.
Chase Clymer
Absolutely. Kristen and Thomas, thanks for exploring that interesting rabbit hole there.
Now, is there anything I didn't ask you about that you want to share with our audience today?
Kristen Pumphrey
Honestly, what I'm really excited about right now is we just launched a collaboration with Peanuts. So this is one of the biggest collaborations we've done to date, both in the recognition of the brand we're working with, but also I would say it's really more so about the volume in which we're doing it because we're wholesaling this collaboration. So we've never offered it wholesale before. And it really allows it to have extra reach.
So it's a Beagle Scouts collab in celebration of their 50th year anniversary. And we created 3 Peanut scents. And it was just so fun and precious and had a great launch party. And it just feels really...
There's a lot of uncertainty right now in the economy and running a business. And there's a lot of day-to-day running the business that's a little stressful. But when I can work on projects like the peanuts thing or work on things that feel creatively fulfilling, it reminds me of why I got into being an entrepreneur. So it's really just about not losing those moments of joy.
Thomas Neuberger
Yeah. And I think about one of the important parts, if I try to bring a lot of this together, with that the collaboration is our entire strategy for marketing this year, which is trying to find new customer bases, trying to do things that are just going to be interesting for our customer. Because we've been doing it for 10 years. What can we do that is us, but also interesting?
The collaboration has been very successful. The peanuts one in particular, because it has a wide base and people were really interested in it. And it allows us to have a lot of fun going forward.
Kristen Pumphrey
Yeah, we're at this interesting inflection point because now we're in 16 years of business. And the inflection point that we're at is, “What's the evolution for the company look like now?”
Already, we talked about the evolution of becoming a more direct to consumer brand. We're opening a third store in Brooklyn soon. So that’s been really exciting for us. But it's a moment for us to step back and really think about, what do we want for ourselves? What do we want for our staff? And what type of product do we want to put out into the world that's actually good stuff? So it feels exciting.
Chase Clymer
That's amazing.
Now, if I'm listening to this show, and I don't know how Google works, where should I go to pick up some of your products?
Kristen Pumphrey
Okay. pfcandleco.com. You can find us on Instagram, TikTok, @pfcandleco and I post behind the scenes stuff on my personal Instagram, which is @_longbranch.
Thomas Neuberger
pfcandleco.com. It’s worldwide, open 24/7 a day. You can inquire any time.
Kristen Pumphrey
He’s good. He’s good.
Thomas Neuberger
You can also go to one of our two shops that are open right now. One in San Francisco, North Beach, and one in Echo Park, Los Angeles. And soon, hopefully expanding to this coast somewhere undetermined.
Kristen Pumphrey
Hopefully.
Chase Clymer
Oh, I believe in you. Kristen, Thomas, thank you so much for coming on the show today.
Kristen Pumphrey
Thank you so much for having us. It was a pleasure.
Thomas Neuberger
Thank you so much.
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!