Saving time and resources is always top of mind for men’s grooming direct-to-consumer brand Huron, says Matt Mullenax, co-founder and CEO. Accounting was one area where Mullenax could reduce costs while increasing accuracy by switching from a reservoir of consultants and agencies to artificial intelligence (AI) software, he says.
The result? “It’s probably saved us five-times the time and double the price savings,” he says.
By automating accounting tasks, Mullenax says he was able to “give time back to the team — time is what we’re constantly fighting for.” Huron migrated to bookkeeping software vendor Finaloop for tasks like creating financial reports due at the end of the month, which are essential for the brand’s investors, he says.
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Previously, the brand relied on consultants to help it process financial information.
“Even with consultants who knew our brand well and knew what we were spending, there was the inevitable back and forth each month,” he says.
The brand has investors to report to, Mullenax says.
“We’re sending out monthly updates, and it’s important that we send those out as quickly as possible,” he says. “We’re able to communicate with our investors earlier, and that’s important for us.”
Finaloop provides ecommerce bookkeeping integrations for issuing invoices, billing and other administrative tasks. Balance sheets and cash flow, are kept in real time. The software also helps ecommerce brands manage inventory by combining a brand’s accounting system with inventory management, says Finaloop founder and CEO Lioran Pinchevski.
Brands must understand what each sale costs by considering expenses like the cost to produce a product, which can include merchant fees, marketing and shipping expenses, he says.
“When you run [marketing] campaigns, for example, the one thing you want to know is your contribution margin. That will dictate whether the next dollar you spend on advertising is actually making you money, or losing you money, which is very important,” Pinchevski says.
Finaloop allows Huron to keep track of revenue from multiple sales streams, which include its Amazon store. Amazon.com Inc. is an important revenue source for Huron, Mullenax says. Like other small- to medium-sized retailers, Amazon became a reliable place to sell during the height of the pandemic. Consumers continue to shop for Huron products in the retailer’s Amazon store.
Customers buy differently on Amazon versus direct-to-consumer websites
Buying behavior tends to be very different depending on if a consumer is shopping through Amazon.com or through usehuron.com, Mullenax says.
“It’s pretty rare that you get a customer who is a subscriber or multi-time purchaser on usehuron.com that then reverts back to jumping on Amazon to buy [a single item],” he says.
Customers spend differently as well, he says.
“Our average order value is much higher on usehuron.com compared with Amazon,” Mullenax says, without revealing more. “But the conversion rate on Amazon is much stronger than it is on our direct-to-consumer website.”
Amazon performs differently, he says.
“On Amazon, it is busy [for us] during busy times or peak seasons, where we’ve seen really strong conversions,” Mullenax says.
This includes periods like Amazon Prime Days. In July 2023, the brand did not offer any discounts on its Amazon store, but it still experienced an increase in sales during the two-day event, he says.
“We had a fantastic Prime Day in 2023,” he says. “Our performance basically doubled year over year, and we didn’t participate in Prime Day discounts.”
Mullenax says he attributes much of this success to the brand’s “strong organic rankings mixed with really good customer reviews on Amazon,” he says.
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While sales on Amazon remain steady, online sales on its direct-to-consumer website are growing stronger, he says.
“One of the things we’ve found interesting on our own website is as we’ve continued to release products and build our assortment, our AOV has basically doubled in Q1 2023 compared with the year before on usehuron.com,” Mullenax says.
He attributes part of that boost to launching new products and charging slightly higher price points, he says.
“And we’ve also had a maniacal focus on what happens in the cart,” he adds. This includes strategic upselling.
“How do we introduce new products to the customer that he or she might not otherwise explore?” he says. “And how do we position those accordingly?”
One tool Huron uses is Shopify’s plugin Rebuy. It appears during checkout and suggests related products. Within a 90-day period between April-July 2023, customers purchased suggested related products through Rebuy 25% more compared to the four years the brand has been in business, he says.
“And over the last six months, when pressed with an opportunity [a consumer is presented with alternative products to purchase], 30% of customers are choosing to add a product to an existing order,” he says.
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