At the age of 21, Sean Edwards got the opportunity of a lifetime to bring Icelandic fish oil powerhouse Lýsi to the United States. It's something he's grabbed with both hands and turned into a great success story.In this interview, Sean discusses:- How their liquid fish oil has disrupted the conventional capsule fish oil market- How his business was turned upside down with covid due to store sampling not being possible and how they pivoted to their online strategy- Why he loves selling on Amazon & Shopify and the core differences between the two and how he approaches them- The importance of knowing your numbers back to front to make more strategic - and profitable - business decisions- His advice to other entrepreneurs in eCommerce on product-market fit and finding your value proposition.Learn more about Lýsi here: https://lysi.us/
Sean Edward - Lies in the US
I'm joined by my good friend Sean Edward, who's the CEO of Lysi in the US.
How did you start your journey in Ecommerce?
I'm from South Carolina and I was never particularly interested in business up until I went to College but I was always playing around with the idea of maybe owning something for myself one day, I just didn't have any clue of how that would actually play out. When I went to Coastal Carolina University which is in Conway, South Carolina, we got introduced to Lysi. And there's this program at Coastal called the Wall Fellows Program. Essentially, it's just a two year development program in the business school, and it's specifically for students that want to go into a higher level career directly out of College. Lysi is an Icelandic company, and they're actually the world's leading producer of fish oil and so what this program did was they would do different projects with Icelandic companies, and they would just be on different topics, different types of companies, different industries. We would do, like a 6 to 8 months project and then actually go to Iceland and present our work. Well, that was just what we were commissioned to do for Lysi but they ended up really liking what we did and they had an interest in coming to the US market. And so what we decided on was if we wanted to take the project a step further, we could put together a go-to-market strategy for them, go to Lysi and if they like it, then maybe we could discuss something. So we did that, they loved it and long story short, myself and then Ross, who is my business partner, he was also in the Wall Fellows class, were given the opportunity to bring Lysi to the US.
So, just to give you some background, Lysi is $100,000,000 company, they have an 11% global market share, they're massive. But most of their money and just business in general, for the last 70/80 years it was pretty much all bulk sales, they made an excellent product, but they weren't really on the consumer side. That's kind of where we came in and brought them to the US and sort of how we got here today. And that was in June 2017.
So you were 21 years old at the time and a hundred million dollar company gave you the responsibility to take it to market in the US, why do you think this happened?
A big one was because they were OK with having a soft start. They don't have tons of US knowledge, or at least they didn't at the time, so they were okay with us. We set up our own LRC and it was a massive opportunity. But also they were able to give us that opportunity without a ton of risk, just because they weren't guaranteeing us 100 Grand salaries, it was more “if we don't produce, we don't make money”, so that was their thinking alongside that. Even then, the idea of 2 21 year olds taking that is pretty wild but we were very grateful for the opportunity and I think we put together a really good plan.
I think it's important to learn from people that have more experience, which is something I've been able to do but everyone wants to make money so if you can make someone else money, they'll listen to you and it just doesn't matter as much anymore on age. If you can deliver, you can deliver, that's it.
What’s your go-to-market strategy, do you focus more on the retail side or do you go directly to the consumer with Amazon or your own Shopify website? What was your next step after you got that deal at Lysi?
That's a good question, because it has changed in every way.
We started directly going to retail. The idea was to start with smaller retailers that are in the health supplement space like healthy grocery stores, to grow, then eventually land in something like Whole Foods and then go from there. We did do that, we grew in about 50 to 60 smaller retailers in the southeastern region. And then we did actually gain placement in Whole Foods in the mid Atlantic region in about 50 stores or so. And the product did very well at first in Whole Foods. We were able to do tons of sampling which was essential because we do capsules and chewables and all that stuff but we specialize in liquid products, which if you tell anyone it doesn't sound appetizing. So to get people to buy it, you have to get them to try it and I'm very lucky because Lysi makes the best liquid fish oil on the planet, it's actually insane how good it is but until someone has tried that, they're not gonna spend 30 bucks on your product.
We were able to do tons of demos at Whole Foods, and we were selling out on a regular basis, then COVID-19 hit and we couldn't do taste tests anymore and we have not
built a brand name for ourselves yet in Whole Foods to where people are just going to be buying our product after they see it on the shelf, so sales really plummeted there.
Fortunately, we had already begun the process of going D2C both on our website and on Amazon so we were able to transition to that and now 90% of sales are on those two platforms as well as some other third party retailers. We do hope to eventually get back into retail and push there once restrictions are loosened.
What's the breakdown between people who consume it in liquid form to capsules? Do you have any data on that?
I can't give you an exact number, but I can say the vast majority are taking capsules but there is a growing interest in liquids because people don't like swallowing tons of huge pills every day and they like the versatility. For instance, if you make a morning smoothie, you can throw it in there, if you do juices in the morning, you can do that, you can mix it with salad dressing. It's a very versatile product.
You sell on Amazon and direct from your website on Shopify as well, how much attention do you give to each and what’s the strategy on each of them?
Again, very good question, because I think anyone in our category is going to be thinking about that exact same thing. The important thing is that you're growing both alongside each other. Right now we do sell a lot more on Amazon than we do on our website but that doesn't mean that we're not giving attention to our website, nor does it mean that in the future we won't even try to get customers to our website from Amazon. The thing is this people are on Amazon every day, they'll either see your product through search or from one of your ads. I think it's important to understand the pros and cons of both. I will absolutely say I'm a huge fan of Amazon because of its simplicity and how well it actually works but I also realize that if you are Prime available and you're shipping through FBA fulfilled by Amazon, they're going to take their cut. So you need to understand your margins and then understand what percentage of every sale they are taking and also realize that all of the tactics that someone uses for retargeting or sending out emails and newsletters just don't exist on Amazon. So it's really balancing the two and understanding the benefit of the short term gain from Amazon sales, while also realizing that if you fully depend on Amazon, someday that could really come back to bite you.
On the Shopify site that you have in particular, what marketing strategies have been effective for you to date?
A lot of the classic ones have been good for us, Amazon PPC has worked really well, although keywords in our category have gotten a lot more expensive in the last few months; Google ads are really good and they're actually less expensive than Amazon right now and we also have social media influencers.
The importance is, on those platforms, the story that you're telling and making sure that you have a cut out of your ideal customer. Your story should be captivating so that it meets that target audience. So we want to be talking a lot about the sustainability of the product, about the fact that our five step refining process gets rid of the toxins and the Mercury found in fish.
And so instead of trying to figure out how to get the most possible sales using the widest possible net, I would actually suggest going more niche, getting a really strong base, and then slowly but surely branching out and seeing what works.
What messages have helped you to differentiate from the other competitors in the space?
Number one, in terms of just separating ourselves from our competitors is the taste of the liquid, that that is first and foremost. So being able to show people a product that actually you can enjoy the taste of it, that is a huge, huge selling point. Another key piece is that liquid absorbs a lot faster than capsules. And then, of course, you get more into the sustainability of the product, Iceland It's one of the most sustainable places in the world, they're literally a beacon of sustainable fishing. Lysi buys renewable energy and has certifications to prove what they are actually doing to be adequate in terms of making a good product and producing it at mass scale, but also keeping the environment in mind.
So what have been some of the obstacles that you've had to overcome that you didn't expect beforehand?
I think the one that's really big is that to do everything yourself online, you really have to be technically sound. There's just a lot that you need to know that does not come naturally, so one big obstacle for me is managing a team that can do it. I work with developers in the US, Canada, and India, for our website and for Amazon, and it's a lot just managing them and making sure that they understand what we want and me having a deep trust in them to deliver. For instance, I would consider myself a pretty decent copywriter but I have very little technical skill. So understanding that you're going to have to work with other people and manage expectations and then deeply trust them to deliver and sometimes trusting their intuition over yours. it's realizing that you can do it all yourself but it's pretty difficult, especially when it comes to spending time you can dedicate to something else like spending my time on forward thinking and where the company is going next and what problems to anticipate six months down the road.
What do you look for when you vet these people to bring in these external partners? Whether it's Facebook, Google Ads, email, Amazon developments, the website development, how would you choose somebody to work with?
Well, I think, of course, the basics need to be there. If you're sending a proposal, it shouldn't just be a generic proposal, like it should be specified to that brand. So being able to show off some of the things that you can do early on is important just because I don't have the time to take every call that is offered to me through LinkedIn, so a targeted strategy is always going to be better, even if that means going from 100 emails a day to five.
But then what I really look for is: Do they respond to emails quickly? Do they thoroughly answer questions if I ask them? Is their information behind the paywall, where we have to put down a deposit before we can really work with them?
If you want good clients, you need to do good work and have it specified to the brand.
What would your advice be to other people starting out in this fiercely competitive space?
The first one would be know your numbers backwards and forwards, know your product’s cost, know your margin and your net profit. Understand that the discounts are a good way to get new customers, but not in your overall strategy. Another one, I would say, is do a couple of things really well before you try to do everything at once. Maybe that's your website on Amazon and then maybe you do start branching out and start selling on Walmart.com, Lucky Vitamin, all these other third party e-retailers. It's not that any of them are bad or good or one is better than the other, it's just that eventually you won’t be able to manage all at once.
What would you recommend for a brand struggling to find their identity on their ecommerce store in terms of content formatting?
If you are struggling, go look at 4 or 5 different competitors not to copy them, but to understand what works well with their website. Take those from theirs and then maybe find things that you don't like so much and then implement those yourself.