Ep9: Ecommerce Marketing and reinventing an industry with Zoltan Csaki from Citizen Wolf

Dec 16, 2019

How do you reinvent an industry with only 8 employees?

That’s what I’m exploring this week with my very special guest Zoltan Csaki, who is the Co-Founder of Citizen Wolf, who simplify and automate the process of tailoring.

Zoltan is super honest and transparent with his struggles – he doesn’t sugar coat the tough journey that we all go through when starting our own business

He’ s trying to reimagine the way that everyday clothes are made, so he has some massive challenges that he touches on and how he has found success so far.

In my conversation with Zoltan we cover a wide range of topics including how to learn from your business failures, lessons from relying too heavily on Facebook ads and why influencer campaigns don’t work for every ecommerce campaign.

Zoltan also discusses how to introduce technology into industries that are resistant to change.

This is a must-listen for any business owner who has just started an ecommerce store. So please enjoy this wide-ranging conversation with Zoltan Csaki.

What you will learn

  • How to learn from your business failures
  • Lessons from relying too heavily on Facebook ads
  • Influencer campaigns don’t work for every ecommerce campaign
  • Lessons on how to tell your brand story in a single post
  • Engagement on Instagram means nothing unless it translates to sales
  • Marketing advice to business owners who are just starting an ecommerce store
  • How to learn new marketing skills
  • User experience – the balance between simplicity and accuracy
  • How to introduce technology into industries that are resistant to change
  • Why Zoltan wouldn’t outsource tech again

Resources mentioned in this episode

Eric Phu – Co Founder at Citizen Wolf

1 in 3 pieces of clothing made every year goes straight to landfill, often with the tags on. The brand that made them can’t afford to dilute their brand by selling at a significant discount. So I’m talking luxury brands or they’re burnt. There’s an identifiable percentage of Sweden’s power that comes from burning H&M clothes.

Fishburners

Citizen Wolf Sydney shopfront @ Suite 5/01 75 Mary St, St Peters NSW 2044

Citizen Wolf Instagram

maggie.the.goldie on Instagram

Sydney Golden Retreiver Meetup 🙂

Zoltan’s magic fit algorithm

Earth Overshoot Day

Shopify

Mailchimp

Sendgrid

15 minutes with a dog increases your serotonin levels by two to three times.

The Business of Fashion

 

Book recommendations

Crossing the Chasm: Marketing and Selling High-Tech Products to Mainstream Customers by by Geoffrey A. Moore (Author), Regis McKenna

The Five Dysfunctions of a Team by Patrick Lencioni

 

What business you would build on Mars?

I was thinking about this and there’s a lesson that I like to think about from Levi Strauss actually who made a lot more money than anybody mining gold ever did right. And as the old adage, you don’t mine the gold, you sell the shovels. Or in this case, the jeans that they were wearing. So I tried to apply that Mars and I was like, “Well, what would that be?” And I guess it would be starting a business that provides the tools for people looking for water on Mars because there is water there and we need if you’re going to make it habitable village or city, we need to solve it. And it’s much easier to extract it probably than get it from any other means. So yeah, I don’t quite know what that would be but I guess I’ve got nine months on the rocket ship to figure it out and talk to the scientists that know.

 

Get in touch with Zoltan

Citizen Wolf website

Citizen Wolf Instagram

Zoltan on LinkedIn

 

Transcript

Brendan:
Tell us the story of how Citizen Wolf came to life.

Zoltan:
Sure, the short story or the longer story?

Brendan:
Mate, let’s go for the long story.

Zoltan:
How much time have we got? So my background originally is advertising. I did visual communications here at UTS and then found myself as an art director in various ad agencies around the world, and that was great. I had a good time. And then one day I got really frustrated with a particular part of the process. So I ended up quitting to make some software, which at the time was called Moodshare. I was very proud of what we did, it was basically real-time collaborative mood boards and this was before Google Docs but I couldn’t turn it into a business. I had absolutely zero experience in B2B sales and we made some mistakes with the tech stack.

So to cut a long story short, couldn’t turn it into a business and kind of had to shut it down and because doing something I’d never done before worked so well the first time, I thought that I’d fall into a fashion brand with a friend of mine. And so we started making graphic T-shirts based around the books that we loved. So we’d read literature, make art, put it on the T-shirt and then sell it via Facebook ads to people who loved the book. And when Facebook just launched or Facebook ads just launched and they were incredibly cheap, it worked. And then the ads got more and more and more expensive and more and more complicated, then it didn’t work so great.

So anyway, I pivoted into menswear proper. We were doing the traditional fashion thing. We were making externally in Portugal and China and going through all of the problems associated with a kind of globalized supply chain and different languages. Had a few successful kick-starters but again ultimately couldn’t turn that idea into a business. I mean it was niche, to say the least right. Menswear inspired by literature. So very, very painfully kind of shut that down. And definitely it took me too long to do that. I was way too emotionally involved.

Zoltan:
Anyway, the phoenix from the ashes of those two experiences is Citizen Wolf and the catalyst for the business starting was actually me arriving back in Australia. I’d been overseas for many years and I reconnected with somebody I used to work with here in my very first job outside of uni in an ad agency. And his name was Eric and he’d been living in China, in Hong Kong primarily. And he’s really short, self admittedly and struggles to find clothes. Literally has to get everything altered right. And in Hong Kong, it wasn’t an issue because there’s tailors on every corner and they’re not snobby. They’ll make you whatever you want right. If you want a fancy suit, easy. If you want anything else, they don’t care. They’ll take your money, they’ll make it.

Here in Australia, it’s not like that right. So you go to a tailor and they’ll be like, “Yeah, I’ll make you a flash suit or a wedding dress perhaps but nothing else.” So it was kind of a flippant comment and he was like, “You know what it’s just so frustrating. Why is it so hard to find clothes that fit?” And I knew enough about clothing at that stage to be dangerous and we started talking and here we are three and a half years later. That’s the genesis of how we began.

Brendan:
And I know you guys have a lot of technology behind your product now as well.

Zoltan:
Yeah, so that was… As I said, the confluence of those previous failures was really pure fashion and I would say I guess pure technology. So Citizen Wolf is very consciously at the intersection of those two domains and my personal position is that the industry is antiquated, to say the least. The way clothes are made hasn’t changed in pretty much 250 years, since the advent of the industrial revolution, the way clothes are made is exactly the same today. It’s faster obviously, things get to market a lot faster and globalized supply chains and fabric comes from around the world. And if you go to fast fashion, those garments they’ll do a little bit in several countries, kind of thing. It’s absolutely crazy, it’s opaque, it’s inefficient, to say the least.

So yeah, our position is really quite simple that if we were to start afresh today, if we were to imagine how clothes should be made with all the technology we have at our disposal today, what would that be? And the answer for us is on-demand, made to measure because it’s better for you the customer, you get exactly what you want, it’s guaranteed to fit and it’s also better for the planet because when you make things on-demand, you don’t sit on stock, nothing goes to landfill as a result. You don’t go on sale, you’re not trying to just move stuff that was poorly forecast. So really for us, tailoring or made to measure is the best way of making clothes.

Brendan:
And you have a quote that I’ve heard you say a couple of times, “Fast fashion is like junk food.” Can you talk on that?

Zoltan:
Yeah, I mean if you don’t know the stats about fashion, they’re really sobering. So one in three pieces of clothing made every year goes straight to landfill.

Brendan:
One in three?

Zoltan:
One in three right, unsold and often with the tags on. Or with the tags on and holes punched through because the brand that made them can’t afford to dilute their brand by selling at a significant discount right. So I’m talking luxury brands or they’re burnt.

Brendan:
Burnt?

Zoltan:
Yep, so there’s an identifiable percentage of Sweden’s power that comes from burning H&M clothes.

Brendan:
What?

Zoltan:
Yeah, it’s crazy. None of which is really an environmental outcome that anybody wants right. So that’s the first one in three pieces of clothing made. The second one in three pieces of clothing made every year ends up in landfill within 12 months right because it’s poor quality, it broke, it twisted, it shrank in the wash or it’s just gone out of style. Because let’s face it, that’s the business right. It’s this constant cycle of new.

So all up that’s approximately 66 billion pieces of clothing that are made every year and go straight to landfill. It’s absolutely insane. So when we say fast fashion is like junk food, it’s quite simply because it’s bad for you, it’s bad for the planet, and it’s unsustainable. So our mission really is to make people reassess their relationship with clothes. Do you need 50 jackets? Probably not. How many do you wear? Should you instead of buying 50 cheap jackets, should you buy instead one or two really well-made jackets that are going to stand the test of time, that are classically designed? They’re not trend led and in doing so, you really are doing your bit to save the planet.

Brendan:
So you have a very personalized product, you’re reducing waste. How do you reach your audience?

Zoltan:
So we’re a direct to consumer brand. We have chosen very consciously to sidestep the traditional industry both on the make side but on the distribution side. And look that comes with its own challenges. It’s certainly not easy to take on that role of customer acquisition, which most brands outsource to David Jones or The Iconic, whoever it might be. So online primarily is how we find people these days.

Although, we began with a shop in Darlinghurst. In fact, we began at Fishburners back in the day when it was in Ultimo. We sort of blagged our way in and then start buying fabric rolls and cutting them up after hours and leaving mess around and basically got tapped on the shoulder and told, “You idiots have to leave. You told us you were making technology.” “Yeah yeah, we’re getting to the technology bit.”

From there we found a space in Darlinghurst, which was effectively an office but it had a single car garage attached to it that nobody was doing anything with and the landlord couldn’t charge us for either. Apparently some quirk of the commercial leasing laws. So anyway we got this garage and we were like, “Okay, guess we’ve got a shop now.” So threw out the door and basically dragged anybody who walked past in and convinced enough of them to buy a T-shirt that we were sort of off to the races. To this day, we do still have a shop. Much nicer, bigger shop with a lot more light down in Haymarket and we also have a sort of a little shop attached to the factory in St Peters. But our business is increasingly transitioning online.

Brendan:
So how do you find people? What channels are you focusing on, keeping in mind that with your previous business you relied too heavily on Facebook, I mean how do you balance that out now in 2019?

Zoltan:
By relying too heavily on Facebook, is perhaps the unfortunate truth. Look, our audience skews a bit older because we do classic basics. It’s about cut, fit and cut or/and fabric. So we don’t print anything on our T-shirts. There are no logos and we find that people wanting to wear that style of clothing, kind of not being validated by logos, is a function of age right.

So our audience tends to skew a bit older. Even as much as actually, more recently, and through Facebook is something that we’ve identified is that older women is a really underserved segment. And they absolutely love what we do because they can get what they want, in a fabric that they choose. They can tweak things like they don’t want the neck to drop too low or they want the sleeves to be a bit longer like say down to the elbow or whatever it happens to be.

We have one story, which one of our customers wanted the sleeves to finish not three quarters, not full length but seven eighths because she doesn’t like… I’m not making this up, when she does the washing up, she doesn’t want to have to pull her sleeves up. So she’s like, “Can you just cut it there so that I don’t have to do that?” And we can because everything’s made on-demand and made to measure, we can make those kind of changes.

So yeah look, we are I would say heavily reliant on Facebook at the moment. It’s about 50/50 organic traffic versus paid at the moment but we are certainly looking to diversify that because I am aware that having all your eggs in one basket is not always the best idea. But to be fair, there’s pretty much one game in town, which is Facebook right. If you want a visually led advertising online because we’ve tried Google, we did. We sunk $1,000 into Google and saw zero sales. So we quickly stopped doing that. Haven’t tried Pinterest but that is sort of next up for us. That said, I looked at the stats, there’s just not that many people using Pinterest in Australia. But yes, we need to diversify.

Brendan:
And what about Instagram? Have you done any influencer campaigns?

Zoltan:
We advertise on Instagram via Facebook as well and there’s a certain customer that is heavily sort of Instagram led for us but it’s not that older lady that I was talking about before. They’re on Facebook, you know what I mean? They haven’t transitioned yet. In terms of influences we’ve at the very start we paid a few people, waste of time, waste of money in my opinion. I know there are a lot of businesses that have done very well off sort of paid influencers. For whatever reason, it hasn’t worked for us.

Brendan:
And were these micro-influencers or where these macro?

Zoltan:
These were… We weren’t paying a lot of money. We didn’t have a lot of money, we still don’t have a lot of money to pay and I personally struggle with that notion of the influencer economy. I think our brand is based on authenticity of self, do you know what I mean in terms of made to measure. When you have to choose the fabric and you choose the style and there’s an element of you as a person in that thing. If we then pay somebody to market that who hasn’t actually bought into the ethos and why it makes sense, it’s kind of disingenuous. And I do suspect that people see through it.

There was a point in time where influencer… Nobody really understood what was going on right. There was this enormous economy and lots of people were doing it and lots of people were spending money and making money. But I do think now everyone’s a little more aware. So I think it’s interesting. I think if I was personally an Instagram influencer, I’d be a bit worried because I wonder how it’s going to change as the algorithm changes and all the rest of it.

Brendan:
Yeah, that’s interesting. So I know that you are active organically on Instagram because that’s how I originally found out about Citizen Wolf scrolling through my Instagram feed, obviously a lot of noise but what stood out to me was a golden retriever.

Zoltan:
Maggie.

Brendan:
Maggie, the golden retriever. So obviously I have a golden retriever myself named Brielle and we have a golden retriever meetup called Inner West Goldies. Shout out to all the golden retrievers who come once a month. So I was very interested, clicked through. So what other sort of… So how do you tell your Instagram story I guess? How do you get the Citizen Wolf brand into a single feed? What stories do you try and tell? I mean because you’ve got so many.

Zoltan:
Right, and that has been our problem from day one. What do we focus on and what’s the story that matters to our audience? Is it fit or is it sustainability? Because made to measure or made on-demand is quite simply the most planet-friendly way of making clothes and I have a huge issue with the macro sustainability trend in fashion and it’s like, “Oh, we use organic cottons so we’re sustainable.” That’s bullshit.

Personally, my opinion is that if you are not running an on-demand manufacturing model if you are still mass producing, often in the third world somewhere, you cannot claim to be sustainable. Because if you’re mass producing, you’re still part of the one in three garments goes to landfill right. Even if you solve the next bit, which is the next one third as in, they don’t break because they’re made well and good for you. Nobody’s solved forecasting in fashion, nobody. That’s why one in three pieces of clothing made every year go straight to landfill. So if you are still playing that mass production game, I believe you cannot claim to be truly sustainable. It’s just greenwashing.

So to get back to your original question, what do people care about? Do they care about it being the most planet-friendly T-shirts in the world or do they care about the made to measure bit? And honestly, we’ve struggled and we go back and forth all the time. And some people care about one and not the other and vice versa. On Instagram as a kind of outbound channel, we have to play both games. When we’re advertising obviously we can dial up one story and dial down the other sort of depending on who we’re talking to.

Honestly, I don’t think we’re good at Instagram. It’s something that we need to get much better at. It’s always been something that was necessary. We have to play the game but we’re a small team and we’re doing a hell of a lot of other things and so it’s never been a focus for us right.

Brendan:
That’s interesting that an e-commerce brand is being honest about Instagram and saying maybe it’s not the best channel because when you talk to early stage businesses that have e-commerce brands, they’re all in the mindset that Instagram is the one and only channel that they have to use.

Zoltan:
Look, it’s different for every business and I can’t speak for anybody else but all I know is that engagement on Instagram means nothing if it doesn’t translate to sales. I don’t care how many people like our photos and now that Instagram’s changed that whole thing, nobody cares anymore. But even before when it was public how many people… Yes, having high engagement is great and that’s what everybody wants and everybody should be striving for.

But ultimately as an e-comm brand if Instagram isn’t driving sales, then it’s not something that we should be focusing on and historically that’s been true for us. But as I say, there are lots of brands I know in Australia and obviously around the world that have managed to make Instagram work for them. So good for them, I wish they’d tell me the secret.

Brendan:
So you have a highly personalized product as well. Is there any way that you can get that level of personalization into the marketing and communications? Is that something you’re trying to work on at the moment?

Zoltan:
Yes, it is. We don’t do a great job of it. I guess the first 18 months I’d say of the life of the company was pretty much R&D. We were selling T-shirts, which was great so we were getting paid for it in many ways but it wasn’t until we launched our Magic Fit algorithm again about 18 months ago that I would say we kind of really started.

Brendan:
So the Magic Fit algorithm, that sounds very interesting. Can you talk us through that a bit more?

Zoltan:
Yeah, sure. So I guess if I had to boil down what we do at Citizen Wolf, we simplify and automate the process of tailoring because historically, traditionally tailoring is a super high touch endeavor. You have to as the customer, you have to go to the shop right. You then have to stand there awkwardly with almost no clothes while you get measured by somebody. It’s a very intimate, kind of up in your grill experience and people go through it because they want the outcome and that’s fine. When we began though, we knew that for suits and for wedding dresses, people will do that right and they will go back for the second fitting and all the rest. And the brands that make those clothes are charging for it right.

Zoltan:
But we weren’t trying to build a tailoring company. We were trying to reimagine the way that clothes are made right. And I mean by clothing, I mean casual clothing. I mean the clothes we wear every day because let’s face it not everybody wears fancy suits these days or just suits, in general, sorry, let alone fancy. And you don’t get married that many times in your life right. So it just seemed crazy to us that the pinnacle of clothing, the best experience for the customer was reserved that are just not worn very much, if at all. So we began by thinking, “Well, how would we, if we could, how could we bring tailoring to the clothing that we wear every day?”

And we knew it couldn’t be done in the same way that it’s traditionally been done. So we built the Magic Fit algorithm really to solve that data in problem. To not force people to have to come to the shop, to be able to do it from the comfort of your home on your sofa. So Magic Fit is a few layers of technology that basically estimates your body measurements based on only three or four very simple biometric inputs that everybody knows. So I need height, weight, age and then for women also bra. And with those three or four data points, we can create a mathematical model of your body, which is about 94% accurate.

Brendan:
Wow.

Zoltan:
Yeah, so we’ve done it thousands and thousands and thousands and thousands of times and it was actually built on very large datasets that we got access to from around the world. And the great thing about an algorithm obviously is that it gets better. So the more data we feed it, the better it gets. The more misses we have, the better it gets too right. So we actually like when it doesn’t work because we get to improve the model and it gets more accurate over time.

Brendan:
So that 94% is going to keep climbing.

Zoltan:
Yes, it should. Look, we could be more accurate immediately by asking more questions but it’s a balance between simplicity and accuracy. And we actually… When we did it, when we made it, we identified about a dozen questions right that we could ask and we ended up trading some accuracy for simplicity. What we’re trying to do is make Citizen Wolf an e-commerce experience that’s basically the same to every other shop you’ve ever been on, with the exception that one time we need to get this data off you. But only once because once we’ve got it, we can make a T-shirt and then once we send it to you and you put it on and if it’s perfect, great. If it’s not, we fix it because we do free alterations, so there’s no risk. But once it’s on you, we can obviously calibrate from that right. So we only need this data off you once and then once we have it the website just turns into a normal e-comm experience.

Brendan:
Wow, so I go to Citizen Wolf website, I pick what shirt I want, I put my numbers into the Magic Fit algorithm, what happens next?

Zoltan:
So you choose your fabric and fabric drives price. So at the moment, we have about six fabrics and we have somewhere between two and six colors per fabric. So we have a wide variety, it starts at $59, which we’re very proud of because we are made here in Sydney. We use Australian made fabric and, of course, it’s made to measure. So at $59, the only reason we can do that is because we’re direct to consumer. If we were trying to sell wholesale, those T-shirts would be $150 as a starting point. But again it’s important to us based on the history of tailoring being for the 1%. It’s actually really important to us that we drive the price down as far as we possibly can so that we can open it up to as many people as possible.

Brendan:
Interesting. Do you have any tips about introducing technology into traditional type businesses like you’ve done and how do you get in that mindset to reinvent a whole industry as you’re attempting to do?

Zoltan:
Yeah, firstly you have to be naïve and stupid with a bit of ego thrown in. I think, honestly, one of the best things I think for what we’re doing is the fact that we do not have a fashion background. So coming at it from the outsider’s perspective is actually, I would say, really critical. We ask naïve questions and then we don’t assume the answer. I’ll give you an example. When we started, everybody said it couldn’t be done right. Nobody wants a tailored T-shirt, nobody’s going to pay for a tailored T-shirt, nobody’s going to make a tailored T-shirt because it’s not a $2,000 suit or a $10,000 wedding dress or whatever it happens to be right. There’s just… The commercial model didn’t make sense for people in the industry.

Zoltan:
I think if we knew more about clothing and how it was made and the traditional business of it, we would have reached the same conclusion. It was actually only by not really knowing a lot of things that we were able to get to a different answer. So I think I have a lot of respect for people that come into new industries from outside. There’s an enormous learning curve, of course, that you’ve got to be prepared to take. But really it is that outsider status that allows us to do what we do.

Brendan:
Yeah, an example of that pops in my head is Elon Musk coming in to build SpaceX, not from a rocket background.

Zoltan:
Yeah, and he was like, “We can make it reusable.” And everyone’s like, “No, you can’t.” And he did.

Brendan:
So you’re the Elon Musk of the fashion industry.

Zoltan:
Oh, shit no, if only. I wish I was Elon Musk, but no. I don’t even think I would compare on the intelligence scale to Elon Musk. Like I’d be a newt compared to Elon or a single celled organism but we’re not making rockets. Fashion is not as sexy as space flight or interplanetary exploration but we do believe we’re changing the world because as I said at the start there’s so many problems in historical issues with fashion and the way things are made. And I said most of it goes to landfill and that’s insane.

Zoltan:
So there are incredibly large structural issues with the business. When two of every three things you make go straight to landfill and nobody questions it, it’s insane. So there’s a lot of people… Fashion’s a tough game but when you figure it out, people make a lot of money right. The richest man in Spain is the guy behind Zara. So when you figure it out yeah there’s money to be made but that myopia of the way things are done means that you just don’t think about sending two out of three things to landfill right, it’s not an issue. But it is an issue because we only have one planet.

Zoltan:
There’s only so many resources and I don’t know if you’re familiar with a concept called Earth Overshoot Day but basically every year there’s a date within that year where we as a planet, as a species, have used the renewable resources of that planet of that year. It’s a bit complicated but it’s basically like the simple idea is a planetary budget. And like a normal financial budget, it should go from the start of the week to the end of the week. Or the start of the month to the end of the month. In this case, the start of the year to the end of the year right. In terms of the earth is capable of only renewing so many resources over a period of 365 days. Well, since the ’70s that day’s been getting earlier and earlier and earlier every year. So in 1970, it was about one planet per year right. This year just gone, June 29 was the date.

Brendan:
Wow.

Zoltan:
So not even seven months into the year. We’ve actually consumed the entire year’s worth of planetary resources. So what that means is that we’re actually using about 1.7 planets worth of resources every year and that’s obviously not okay.

Brendan:
Not sustainable.

Zoltan:
Yeah.

Brendan:
Wow. How are you guys leveraging the whole zero waste movement and a lot of publicity around sustainability at the moment? How are you guys leveraging that?

Zoltan:
Yes, I think if we tried to start Citizen Wolf five years ago even, maybe 10, I think our timing would have been off. There’s a huge movement towards sustainability in fashion. As I said before I have a huge problem with it mostly because I do believe it’s greenwashing for the most part. H&M say they have this conscious collection and The Iconic comes out with a conscious collection. It’s all bullshit in my opinion because none of those brands run and on-demand manufacturing model. They are all part of the structural problem with one in three or two in three pieces of clothing go to landfill every year right.

Zoltan:
So that said, there’s movement and there’s a general awareness more than ever about how clothes are made and people being conscious of that. So look, our timing in that sense was good. What we’ve found though, is we set out to solve the fit problem. The sustainability bit, it’s actually a byproduct of just making things in a better way. We kind of stumbled on it. I’d like to sit here and claim that we’d mapped it all out and we’re geniuses. It’s not true. We saw a problem, we tackled it and then as we’ve gone on, we’ve kind of realized that there are all these ancillary benefits of the way that we make clothes.

Brendan:
And speaking about software development for small business, so you already had a software background. How do early stage businesses who want to venture out into some kind of tech area for their business, what do you recommend that these guys do?

Zoltan:
So technology’s hard right. It’s never been easier to start a company. There are incredible tools around these days. Most of them are real accessible price-wise, not having to build your own e-commerce solution for example. You can spin up a Shopify store in an afternoon, that’s pretty crazy. However, there’s zero differentiation right and that’s the problem. I think deep technology is something that you really have to do internally. I think you can start. You can do an MVP, you can do a pilot sort of thing if you outsource dev. It comes with its own risks, I’ve been there, I’ve done it. I’ve had some good experiences. I had a lot of terrible experiences outsourcing.

Zoltan:
I would say it’s a great way to start but as soon as you possibly can you need to bring that in-house because you just don’t move fast enough is my experience with outsourcing dev. You just don’t move fast enough and when you’re in certainly e-comm or you’re in the tech game, speed is your greatest asset. So yeah, when you’re stuck writing specs and detailed this button has to go here and you have to meticulously detail it to the nth degree so that the dev shop doesn’t screw it up. But invariably they will, it’s ultimately, it’s not a great use of time. Whereas, if you’re sitting next to that person it tends to go much faster.

Brendan:
And you touched on tools. What kind of tools do Citizen Wolf use in their marketing and are there any under $100 that have maybe made a big, significant impact in the business?

Zoltan:
So we use at the moment… We’re on Shopify.

Brendan:
You’re on Shopify, nice.

Zoltan:
Highly customized but we started by buying one of their themes, which was cool. Shopify is a bit of a love, hate relationship. There are a lot of good things and a lot of annoying things. But look, Shopify’s great for the most part. What else? We use Mailchimp, although now that they’ve sort of broken up their marriage with Shopify we’re looking to move.

Zoltan:
We use SendGrid for our transactional emails because every time you make a purchase there’s a sequence of emails that go out. Like your T-shirt was cut 23 seconds ago, based on the tech it literally was cut and then we send them an email. So we’ve got a bunch of those and they’re off SendGrid. So I think we’re going to transition our marketing email capacity to SendGrid too because they’ve just done this thing and our text messages come through Twilio and they’re all now the one shop.

Brendan:
Nice.

Zoltan:
So just sort of that seems to make sense to us and what else? I’m not really sure. I think that’s kind of it. It’s a pretty simple stack. We don’t… Oh, there’s some Instagram sort of scheduling apps that we are starting to use because we’re trying to build that Instagram muscle. The irony of coming from an advertising background is that we’re pretty shit at marketing. We’re getting better but we really did, we had so many things to solve on the product level.

Zoltan:
And I haven’t said it yet but we actually ended up creating our own factory because the garment manufacturers that existed didn’t want to work with us because they’re from that legacy mindset of, “Yeah, I’ll make you 500 tees or 5,000 even better. I’m not going to make you one. Or if I am going to make you one, it’s called a sample and it’s going to cost you three times what it should cost to make the T-shirt.” And they just couldn’t compute that there’s a different way of doing it and they couldn’t understand that you could cut things one by one on a laser, each one being different versus cutting 500 at a time on a big roll. And so we struggled for ages.

Zoltan:
We found a little outsourced manufacturing shop down in Waterloo and they were great because they wanted to work with us but we would deliver a batch of T-shirts and it would sit on her floor for a week. But if it wasn’t sitting on the floor, it wasn’t in the product queue. So when we started, it took us about four weeks to deliver a T-shirt. And the fact that people paid us money and then waited four weeks still blows my mind.

Today, it’s on average we turn it around in under 10 days and we’re getting faster all the time. But that’s because we ended up biting the bullet and creating our own factory. We did that also because what couldn’t get Ethical Clothing Australia accreditation through this other shop because they’re the unions and they didn’t want them in there, and that’s fine. Yeah, that was another major catalyst for it.

We’re also on the road to be corp and it makes it a lot easier to do things like that. We’ve recently also voluntarily opted into the Modern Slavery Act, and again that makes it really easy for us because that first tier, that manufacturing tier, is us. That’s already our business so it’s very easy for us to say, there’s no slavery here because I know everybody gets paid award wages or better. And we make everything here in Sydney or in Australia. In Sydney, it’s really expensive but we do that because it’s the best way to make clothes. The money stays here, it’s good for the local economy. We create jobs but it’s also the fastest way to do it because if you go to another online tailor and they make it in, it doesn’t matter where, not Australia, you’re generally waiting sort of four to eight weeks for something. If we can turn it around in a week, then that’s a better experience.

Brendan:
And you mentioned your experience at the ad agencies overseas. Is there anything that you have taken from that experience that you’ve now transitioned into Citizen Wolf?

Zoltan:
Yeah, I need more people. It’s nice to be part of a really big team. There’s a lot of inefficiencies, don’t get me wrong, in big teams. But we are trying to reinvent an industry and at the moment we’re eight people.

Brendan:
Wow.

Zoltan:
So it’s hard. We’re juggling a lot of hats each. We’re dropping balls as a result. We are not as good as we should or could be in kind of… Not on the product side, the product is excellent. It always has been. But on the operations side, on the marketing side as I said ironically there’s a lot of things we could be doing better. So yeah, I’d like more people.

Brendan:
How do you keep your employees engaged and motivated?

Zoltan:
So it was important to Eric and I that everybody had equity. At the moment, we are a small team. It is a startup, it’s inherently risky. So we’re not greedily trying to keep it all to ourselves. We really do believe that you get the best out of people by motivating them as owners of the business and just trusting that they will make good decisions from that standpoint. So that’s the first thing and I guess the most important.

Brendan:
And they’ve also got Maggie the golden retriever as well in the office.

Zoltan:
Look, don’t get me wrong. Maggie, she’s our cortisol differential machine. If anybody’s stressed or swearing, which is most of the time me, she comes up and she sits right next to you and she puts her hand on you and it’s like, come on let’s have a cuddle. Yeah, it’s wonderful and I think it’s really… It blows my mind that most companies do not let people bring dogs to work. I know it’s like a Silicon Valley kind of startup kind of thing but it’s crazy because there’s heaps and heaps of scientific papers that show dogs in the office reduce stress.

Brendan:
Yeah, I’ve been reading a couple, funnily enough, trying to get my golden retriever, Brielle, into some offices. And only 15 minutes with a dog increases your serotonin levels by two to three times.

Zoltan:
Yeah, really?

Brendan:
Yeah, there’s some crazy benefits. And I mean icebreakers and team building as well, exercise instead of going for a smoke break, you can go round the block and take your dog to the toilet.

Zoltan:
Yeah, look, there’s so many benefits and it’s funny because she’s my dog but everybody loves her. Everybody in the company really, really loves her and it’s good for the dog too. It’s good for Maggie because she gets socialized with a ton of people. When we used to sit in Haymarket all the time there’d be hundreds of people coming in sort of every week and I think that’s really good as well from the dog’s perspective. But yeah, certainly the payoff to the humans is pretty huge.

Brendan:
And good for the social media posts as well.

Zoltan:
And every time we do a photoshoot, I’m determined to get Maggie in there. She’s very photogenic, straight down the barrel. No blinking, she knows what’s going on.

Brendan:
Trained very well. So you mentioned that you’ve come into an industry pretty fresh. How do you learn how to learn? How did you get up to speed on the fashion industry originally and how do you do that? Do you read books, do you go online? Can you talk us through that?

Zoltan:
Yeah, look I think anybody who is in the startup game has to love learning. And if you don’t, you should go and just get a job in corporate because it’s way easier and more stable. And there’s probably more money in it. But you really do have to love learning and you have to be comfortable with not knowing the answer right. And not everybody’s okay with that but there’s a pretty crazy resource called the internet and almost everything’s there right. And you can get up to speed kind of quickly.

But there’s an accumulation, aggregation sort of aspect to it where it is only after years of looking at stuff that it all kind of starts to build this map. But yeah, absolutely reading books, reading blogs. There’s an interesting, really good resource in fashion in particular called Business of Fashion, which does what it says on the tin. Which has really interesting articles and stuff. We’d never opened a shop when we opened that shop in Darlinghurst, had no idea.

When I went through uni, I was a bartender. So I’d never even had retail experience but our bumper sticker, or my personal bumper sticker is, “How hard can it be?” Turns out, pretty bloody hard. And low and behold there’s a lot that I don’t know and probably won’t know. But yeah I do think having a really naïve I would say mindset and attitude to things is really important. Not assuming that you know the answer. And the other thing I would say is just the whole lean methodology of do a small experiment, see what happens. If it works double down if it doesn’t do something else. I think building that muscle and being able to get through those loops faster, whatever that might mean for you and your business, that’s the critical thing.

Brendan:
Circling back to the books, is there any particular book that you recommend for people in early stage business?

Zoltan:
Yeah, so there’s a couple we’ve bought recently, Crossing the Chasm, which is a pretty old classic, updated semi-recently by Geoffrey Moore. And then something else we’ve just been put onto is quite happily called The Five Dysfunctions of a Team by Patrick Lencioni. Management is hard, management of people is really hard and in my previous job in the corporate world as an art director I didn’t really have to do that. You work in these little teams of one or two people, sometimes three and you’re kind of off doing your own thing as a creative. So you’re just not exposed to that side of things.

But as we grow and we put on more people, the people management side of things is something. That’s sort of the next thing that I need to really dive into because I need to get better at it. And when you’re not paying above market rate when you’re paying probably below market rate as we do, as most startups do, you’re selling the dream and you have people working for you who yeah, everybody needs money. But actually the reason that somebody comes and chooses to work with Citizen Wolf is because they fundamentally believe that there’s a better way of making clothes. And the current system is broken.

So just making sure that everybody’s on board and everybody knows that there’s a higher purpose is really important. And being clear and being able to articulate it, again it only comes through repetition and time. We’re three and a half years in and I’m only now really starting to kind of understand what we do and why. It sounds crazy or maybe I’m getting better at articulating it.

Brendan:
So you speak about living the dream and you’re doing something that you’re passionate about, reinventing the fashion industry. When did you come to the realization that you could do something for a living that you’re so passionate about?

Zoltan:
I only analyzed the journey so far at the start and I don’t think it was a realization, I think it was just a series of steps in no particular order that ended up putting me here. I look back and I do think if I had to divine a red thread it would be I guess waste and frustration at inefficiency. I remember as a kid I got sent to what was called the Sydney Japanese School. Don’t ask me why, my mom sent me there. And so obviously we had to learn kanji the script based on the Chinese alphabet. And each letter… You can’t just do whatever you want, there’s a sequence in terms of writing the letters. And we used to get these worksheets every day, this homework kind of thing and I’m not alone in this surely, but I figured out that it was way easier to just do the first stroke in every square, like a hundred squares on a page, the first one and then the second one and then the third one and then the fourth one. Rather than do it one by one. And I think just that sort of has stuck with me all the way through life.

And then the reason I quit advertising was because I just got so frustrated with the waste. So many people’s time and so many good ideas just getting killed at the coalface of the client just doesn’t have the balls to sign it off or suddenly the budget evaporates. And there’s just so much wheel spinning in advertising. That business is mostly PowerPoints and then occasionally something gets put on a bus or on the telly or whatever it happens to be right. But it’s 80% PowerPoint and it’s just super frustrating.

So I got sick of that and I sort of wanted just more, faster action you know. And then with Citizen Wolf, it’s eliminating waste in the way that clothes are made and just not making stuff to go to landfill right. So that’s something I think about a bit recently and I don’t think I’ve articulated it very well but that’s something that’s occurred to me recently.

Brendan:
No, that’s an amazing mission. So Zoltan, I want to thank you so much for coming in and spending some time with us today, providing a lot of value to our listeners. Everything that Zoltan has said, you can find in the show notes at metigy.com/podcast.

I’ve got a couple of questions before we bid you farewell today. I just wanted to get your perspective on what you would tell early stage companies that are starting an e-commerce brand for the first time, what kind of tips around marketing would you give these guys?

Zoltan:
Oof, that’s a good question. I think, first of all, it’s much easier I would say to sell a product that’s differentiated than just trying to sell a generic product. On the one hand, you’re competing on price if you’re just selling what everybody else is selling, you really only have price to play with. If you’re making stuff that’s novel, that’s yours, I think it’s a lot easier. But I guess the real lesson is, know your customer. And it sounds trite but really three and a half years in, I think we’re only just beginning to really know who our customer is at Citizen Wolf. But if you’re really clear on that, everything gets simple. The way you write is easier, who you target is obviously easier. Where you put the ads and I think we’ve never done a good job at really deep diving into that.

We’re doing it now but that I would say that would be my number one piece of advice is, lance that up, get out of the building, really, really, really understand the problem that you’re solving if you are. Hopefully you are, and why people will give you money to solve that problem. I’ve only recently become aware of the adage, vitamins versus painkillers. And the next one after that’s air right. So I don’t know what you think about vitamins but generally, people pay for them but it’s questionable if they have any effect. So it’s hard to get money out of people for vitamins. Whereas if they’ve got a headache and you’re a painkiller and you solve that problem immediately, it’s much easier. What you ultimately want to be is air. You must have air or you die right. So if you can get up there, you’re made. And it really is understanding the problem.

Brendan:
Awesome, Zoltan. Thank you very much for coming in today. We have one final question that we like to ask all of our guests. Are you ready for launch because we’re going to Mars? You’re on the first flight to Mars with Elon Musk and the first settlers aboard the SpaceX Starship rocket. What business do you start when you land on Mars and how would you market it to the new Martians?

Zoltan:
So, I was thinking about this and there’s a lesson that I like to think about from Levi Strauss actually who made a lot more money than anybody mining gold ever did right. And as the old adage, you don’t mine the gold, you sell the shovels. Or in this case, the jeans that they were wearing. So I tried to apply that Mars and I was like, “Well, what would that be?” And I guess it would be starting a business that provides the tools for people looking for water on Mars because there is water there and we need if you’re going to make it habitable village or city, we need to solve it. And it’s much easier to extract it probably than get it from any other means. So yeah, I don’t quite know what that would be but I guess I’ve got nine months on the rocket ship to figure it out and talk to the scientists that know.

Brendan:
You can talk to Elon as well.

Zoltan:
Yeah, hopefully, him too. He’s probably got an idea.

Brendan:
Yeah, he’d have a couple I imagine. So Zoltan, really appreciate your time today. Is there anything else you’d like to say before we wrap up and how can people find out more about Citizen Wolf?

Zoltan:
Only thank you. Thanks for having me. It’s been great to chat. Yeah, you can find us online, citizenwolf.com. If you are in Sydney, come down to the shop. You can touch and feel all the fabrics. But yeah, the Magic Fit algorithm was built so that you don’t have to. We’re Australia only at the moment but wherever you are, jump online. Shipping is free. Prices start at $59 and I guarantee it’s the best T-shirt you’ll ever own.

Brendan:
Yeah, well I’m going to head down on the weekend because this T-shirt is not fitting very well.

Zoltan:
I wasn’t going to say anything. I was thinking it the whole time but I wasn’t going to say anything.

Brendan:
Not the best and it might get added to the H&M fire pile in Sweden as well. So now you’ve definitely opened up my eyes to sustainability in fashion. Zoltan, once again thank you for coming on the show.

Zoltan:
Thank you, thanks for having me.

Leave a reply?

Your email address will not be published. Required fields are marked *