More About This Episode In this episode, Zach talks to Andrew Legge, Founder and Managing Partner at Havelock Wool, about the unique promise he makes with his commodity product, and how that is turning into incredible sales and brand loyalty. Transcript Zach Williams: I like to say that the best promise wins, not the best product. And what I mean by this is that most manufacturers are incredibly focused on having the best product in the industry. And yes, that is important; your product should perform. But at the end of the day, your product can perform, it can have the best features, but if your promise to your customer does not resonate, it doesn't matter. The promise you make to your customer, across the entire sales channel, has to work in order for you to move product. And on today's episode, I talk to a guest who has an incredibly unique promise I'm really excited to share with you for his commodity product. He's selling direct, making it easy for customers, and making this company a success in the process. It's a super relevant podcast for anybody who's looking to improve their messaging, improve their marketing, and create a promise that resonates with their audience. All right, let's get into the show. Voiceover: Welcome to the Smarter Building Materials Marketing Podcast, helping you find better ways to grow leads, sales, and outperform your competition. And now, here are your hosts, Zach Williams and Beth PopNikolov. Zach Williams: All right everybody, welcome to Smarter Building Materials Marketing, where we believe your online presence should be your best salesperson. I am Zach Williams, and we have a great show lined up for you today. We've got Andrew Legge, who's a managing partner at Havelock Wool on the show with us today to talk about their marketing and sales and how they've grown. Welcome to the show, Andrew. Andrew Legge: Thank you very much for having me, delighted to be here. Zach Williams: So Andrew, for our listeners, why don't you share with us a little about Havelock Wool, how you all got started and who you all sell to, and then we'll dive in a little bit about your marketing. Andrew Legge: Yeah, sure. There's kind of a long story for how we got started, so I'm going to make it short so we don't bore anybody. But essentially, I was leaving a former career in private equity. I had developed a love affair with all things New Zealand, and so transitioning back from living in Asia for six years, I went and spent some time there and really started to nose around on some theories that I had about small business opportunities. In fairness, I had no view towards insulation, and I met some people who were trying to do something in this regard, and I got very excited about it. Andrew Legge: So a couple of years later, after doing a lot of homework, a lot of diligence and having a lot of conversations around what kind of market opportunity there might be for this product, we decided to launch the company. That was in October 2013. We followed what I would say are traditional channels to market, i.e lots of meetings and lunch and learns with architects and builders and insulation installers. And we found that we got a great reception, but it did nothing for us from a sales perspective. And so as this world has evolved, we were quite happy to stick our nose into this constantly changing dynamic, really fun environment around digital marketing. I would say we kicked off those efforts about two years ago, and we saw a dramatic change in awareness interest and sales for our business on the back of those efforts. So- Zach Williams: Who are you marketing to? Andrew Legge: We market, essentially, to the end user. Zach Williams: Okay. Andrew Legge: And as you know, probably better than us, this is sort of a complex channel, and there are lots of "interested parties", but let's just call them participants, in that channel. And what we have found... And this happened early, even though we weren't focusing on it, just because we have lots of friends. Anytime we knew the end user of the product, everything went really well. So, the builder might not like it, because it's something new and different, but guess what? The builder doesn't get to care, because the end user is making the decision. So we always knew that that was a good place for us, but it just didn't seem like a very effective way to run around and look for people who had a building project going Zach Williams: Sell by one, by one, by one, versus get in with somebody who's advocating for you? Andrew Legge: Yeah. To be honest, I was wrong, to some large degree, in that aspect, because I've never been a B2C person. And to me, it just seemed... Like, following the traditional channels of trying to get somebody to read an article about what we were doing, great, they might really enjoy hearing and learning about Havelock Wool, but if they're not building something at the time, then who cares? Well, of course, we always knew that there was this search engine called Google. Zach Williams: It's a beautiful place. Right? Andrew Legge: Yeah. But what we didn't appreciate... or let me say, what I didn't appreciate is that somebody typing in, healthy insulation, or alternative insulation, or green insulation into a Google search is in market. Zach Williams: Oh, they have intent. Andrew Legge: Yeah. Zach Williams: We talk about that all the time. Like, that person has intent to buy something that solves that problem. I mean, it's very different than, let's say social, which granted, you can drive a ton of sales and a ton of demand from social, but it's a totally different game. Andrew Legge: Yeah. And so that is where the discussion sort of started. Right? Like, I'm in Google, I'm looking for a healthy alternative, and we just sort of let that snowball on itself. And that has led us into lots of different places. But again, really, we're talking home owner and a market that randomly developed for us is... I don't know if you're familiar with all of this enthusiasm around van conversions. Zach Williams: Yes. Isn't it wild? Andrew Legge: Yeah. Well, so I always wanted one. And so in 2016, I bought one for myself, I insulated it with wool for fun, because it made sense, and it's a condensation trap, and wool is great with moisture. And so I drove it around for a year and a half and finally, at one point we were like, "You know what? Maybe we should market into this space." And it's becoming not insignificant line item to our business. And so again, that's an end use, and that's really interesting, actually, from a marketing perspective, because the ecosystem that exists around social and DIY and sharing within that world is wide open, and everybody knows where to find everybody and everyone's friendly and they're really trying to help one another. Basically, that's become a testing ground for us. So we try something new there and if it works, we pull it into our residential space, which, of course, is the lion's share of our business. Source Zach Williams: Wait. Can I just pause on that real quickly- Andrew Legge: Please. Zach Williams: ... to make sure I understand this, Andrew? Your testing ground for your product are vans. Is that correct? Like, converted vans? I'm thinking about like Free Solo, the documentary. Andrew Legge: No. So our testing ground for marketing is the van world. Zach Williams: Gotcha. So like, you test your marketing there- Andrew Legge: Yup. Zach Williams: ... then you expand out. Andrew Legge: Yeah. So here's the perfect example. Direct to consumer, for manufacturers, is becoming a thing. Right? Zach Williams: Yes. It's huge. Andrew Legge: And I don't see a fiberglass insulation manufacturer gaining a lot of traction selling direct to consumers, because the reality is most people want to pretend that stuff doesn't even exist. Now, it's a necessary product that we need to have in the built environment. Sure. Right? I'm not trying to- Zach Williams: Yes. Andrew Legge: ... say we're here to replace those guys. Right? But our experience is, we will get people in our office that we can't get to leave. They want to stand around and talk about installation all day long. And nobody does that with fiberglass. At least nobody that I know, or I've ever met. And so as this whole story has evolved, we've taken this thing out to say, "Hey, we can sell direct to consumers, so we have our distributor friends." But particularly, here is a perfect example in the van life space. We put a shopping cart on our website, and we made it very clear for you, as a van lifer, what you need based on what your van is. And you can now come on our website and you can buy, right there, the amount of insulation you need for your van, and we mail it to you. Zach Williams: Wait, I need to check this out right now. Andrew Legge: So go to Havelock Wool, and then you'll see van life. Zach Williams: Buy for your van. You literally have a link at the top of your page. Andrew Legge: Yes. Zach Williams: You can see the different amount of bags that you need for every van. You got videos, installation, how to insulate, all the benefits. How does this page rank on Google? This has got to rank really well. I mean, you have so much content on this page. Andrew Legge: We do, and we're constantly trying to improve that. We actually just put out a bunch of videos last week that we're pretty excited about, to help people on the install side of things. Zach Williams: This is fascinating. So this is like your micro chasm of like people that may like your product, that you test everything on, and then you roll it out to the masses? Andrew Legge: Yeah. Zach Williams: How did you stumble on this? Like, this is the wildest thing ever. How did you stumble on this? Andrew Legge: We just organically created it, and we did it slowly. We do everything slowly. I'm pretty conservative. We listened to people, we took our experience, and we tried to drop it into what you're looking at. Right? So, take it back to when we first... when we hired Josh, who runs our sales. In his early days, he would spend an hour on the phone with somebody who wanted to buy two bags for their van. Well, you can still call us and talk to us, we do it all day long, but what we've tried to do is put all of that information right in front of you, right? In what you're looking at right now. So if you don't want to talk to us, you don't have to. Zach Williams: You don't have to. Frankly, it's not rocket science. Andrew Legge: Nope. Zach Williams: But it is... it's that convenience component, like, how can I give people that are searching for my information access to the answers, to the questions they have, right in the moment, without having to talk to somebody? Andrew Legge: Totally. And it's like your piece on the architects, that we were just talking about, and who it is that you're trying to connect with. It's the person who's sitting there that wants to do lots of research and know a lot of things before they talk to you. Right? So that's what we're trying to do, say, "Here's everything you need to know. You can buy, right here, if that's good enough for you. Or, if you want to pick up the phone and call us, feel free." Zach Williams: So, talk me through how you're taking this information from... You've got this small group of people that are... Would you call them your brand advocates or as like, just your testing ground? How do you internally refer to them? Andrew Legge: They are van life buddies. Zach Williams: That's so funny. So how do you take that and then roll it out to like the masses? Give me an example. What does that look like? You learn something like, Hey, it insulates the van well, and people like it this way, and so clearly it'll work in a residential space? Andrew Legge: Well, so the dynamics of a wool fiber are really second to none. Right? It's evolved across thousands of years as an insulator. So, we're lucky that we've got this amazing product that fits in lots of aspects. Right? And moisture management is a key component of what wool inherently does on its own because of the five follicles in the fiber. And so if you take a van and you think about driving that thing around in all these different environments, it's going to create a lot of condensation. Right? And so I put it in the floor of my van and when I redid it two years later, I pulled it up and I videoed it, and the bats were literally just as I left them. They were still the same color, there was no breakdown, there was no mold because water had seeped through, because I'd use it to go skiing all the time. It was literally just as if I put it in yesterday. Andrew Legge: We don't get very deep in the building science discussion within vans, except for when people call us and say, "What do I do with the vapor barrier?" And we tell them to either leave it on the shelf at Home Depot or put it in the garbage, if they've already bought it. But that discussion then very quickly transcends into the airtight way in which we're trying to build homes, and that's where we spend a lot of time in the building science discussion and we talk about vapor variability. And again, we're talking about indoor air quality issues, where, of course, these speak to the advantages of wool. We don't do that because it's a hardcore sales thing, it's because it's what we think people want to know and understand and deserve to know, that there are high performance, natural alternatives to insulation. Andrew Legge: Now, specifically, from a marketing standpoint, to be honest, it's what stretches our minds every day, because that ecosystem that is so great within the van life world doesn't exist in the residential world. It's highly fragmented, and there are interested parties with different motivations and measures for success across the entire process of building something. What we have found is that the trade is way behind the consumer. There are very "well-educated", intelligent architects who have no idea what material specification looks like. Andrew Legge: To me, I'll make this personal, so I'm not trying to speak for anyone else, that's just not good enough. When you look at what the built environment looks like today, how it's going to double over the next 40 years, and you're talking about 2.4 trillion square feet, and you look at GHG emissions, and the fact that the built environment is 40% of that and 11% of that figure is materials, we need to be doing a better job with material selection, and that falls on the desk of the architects, as far as I'm concerned. So, we spend an increasing amount of time on that piece- Zach Williams: Educating them? Like, how to educate the... Andrew Legge: Absolutely, educating. So for example, we started at the end of last year and we're doing an LCA EPD with Sustainable Minds, and that will greatly increase the necessary elements to that conversation for us to try and speak the same language to those guys. So we're not like pounding the table, like, "You need to do better," we're pounding the table saying, "It would be great if we can help you expand your horizon to understand how important this stuff is." Zach Williams: Before we started talking, before we were recording here, Andrew, you were talking about, you were having a difficult time getting in front of architects. You flipped your marketing on its head, you started doing digital, creating pull through, how are you getting architects to listen to you? How are you getting in the door with them, today, versus when you first started? Andrew Legge: To be honest, getting in the door has never been the problem. They are always happy to have you in and have you tell them about a product. Zach Williams: It's getting specified? Andrew Legge: Yeah, exactly. It's getting specified, it's getting traction after those discussions, and that's what we have not seen happen. Zach Williams: What did you do differently to start making that happen? Is it just you're creating the homeowner to create pull through? Andrew Legge: Yes, a hundred percent. Zach Williams: It's all homeowner pull through? I want this product- Andrew Legge: A hundred percent. Zach Williams: ... I don't care a builder, architect, contractor that you don't want it, I want this. Andrew Legge: Yeah. I'm paying the bills, I want it, get it in my house. Zach Williams: So how are you getting in front of homeowners then, at a scale, without to like sell one on one on one on one? Andrew Legge: To be honest, that goes back to the content creation and the digital marketing. We're a small business, so it's all relative. Right? But for us, we spend a lot of money on ad words. We've got ads on Facebook, we're active on Instagram, and we are using those channels to get in front of people who are in process and in market. And that's been a big learning curve for us. Right? Because we were looking at sort of traditional channels not appreciating that you don't do a lot of insulation research on a Sunday afternoon for fun. Right? Zach Williams: No. Andrew Legge: When you want something in the building material realm, you're doing research because you're going to buy it. And so we're trying to make sure that we're present in that discussion and in that search. Source Zach Williams: So is there like a tipping point for you, when you started to really use and leverage digital, that you started to see people increase demand, specifically homeowners? Was there something you did or a strategy that you changed? What was that? Andrew Legge: So, a hundred percent. The first thing we did was we spent a couple of years kind of getting beaten up by this whole thing and trying to figure out the manufacturing side of things and following those traditional channels, and frankly, being led astray a bit. Because we would go have these meetings, people would tell us that they loved what we were doing. Zach Williams: And then you wouldn't get the sale. They wouldn't ever specify. Andrew Legge: Exactly. Then they just wouldn't use us. So there's only so many times you can do that before you're like, "Wait a minute. This isn't going to work." So it was an element of, do we want to keep pounding our head into the same wall, or do we want to try something different? And so we didn't run in another direction and say, "Hey, forget all you guys." We just said, "Let's sort of try this and see what happens." And we rebuilt our website. We hired a digital marketing firm, we got in the conversation and got ourselves on that learning curve for understanding how we could get in front of people. I did that on the back of hiring a full-time salesperson. And six months later, we hired a full-time marketing person. Andrew Legge: Those guys, again, were lucky, because we've got this amazing product... Not to take anything away from those guys, because I think our team is amazing. It's small, but we're nimble and we learn quickly. And I think that we can create a lot of disruption in this space because we have the product, it's one that people care about, want to talk about, don't want to run away from, and we're very quick to see the world for what it is, what may or may not work, going forward, in our view. And then because we're nimble, we can quickly adapt to these new platforms and test them. That's the beauty of it, right? You can test it and understand it, see what works and see what doesn't work in a very short period of time without spending a ton of money. And then you can very quickly kind of layer onto what's working while you're backing away from what isn't. Andrew Legge: About two years ago, we sort of upgraded everything internally, from a systems perspective, and really started to go after this. But, again, we're small business, we've got a lot of guys working in the back in production, so our burn rate is high. So we had to sort of ease our way into it, and we continue to do that. But after that lag effect of, call it three to six months, you start selling, and you start looking at these very real metrics, which is really fun. Zach Williams: Where are you driving the most demand from? What different avenues are creating the most traction for you? Is it Google? Is it social? Is it email? Is it content? What's working best for you? Andrew Legge: The easy answer is Google. Zach Williams: Okay. Because it's very bottom funnel. Andrew Legge: It is. Zach Williams: And what are you trying to push them to? Are you trying to push them to a sample request, a phone call? What are you trying to get that user to do? Andrew Legge: We want them to let us know that they're interested in learning more from us. Zach Williams: So do you give them like a video, or what does that look like? Andrew Legge: So, we change it around. Right? But ultimately, we want the form fill that says, "We want to know more about Havelock Wool." Zach Williams: Okay. Andrew Legge: And we're not trying to trick anybody, but it'll look different on Facebook, because that's a different audience, than, say something coming direct out of Google. Definitely our best return on spend, if we measure it directly, is out of Google. But there's this also... this somewhat intangible of how much does Facebook Ads feed that direct search for Havelock, which is not getting attributed to Facebook, but is coming up through direct. Like, now I'm in Google looking for Havelock Wool and now I'm a buyer. We've literally seen people come in that way. We've seen people on a $3 click lead to a $26,000 sale. Zach Williams: There you go. Andrew Legge: This is our best metric so far. But we've seen a host in the five to $16,000 range. So right now, we have a return on ad spend that just falls shy of six times, and so it puts us in a very interesting place when we delve back into this traditional way of doing things. What I mean by that, if somebody calls and says, "Hey, we're hearing great things about Havelock Wool. How about you guys come participate in this conference?" And I'm not trying to be flippant, right? But I have to ask a question like, okay, here's the rough amount of money you want me to spend. If you think I'm going to stand around the coffee pot and glad-hand people for that amount of money, I'm not going to. Zach Williams: No. Andrew Legge: Right? Zach Williams: Not a chance. Andrew Legge: You've got to offer me more, because I know if I spend $7,000 in these channels that I'm using actively, I'm going to make six times my money, almost six times. Zach Williams: See, you're hitting on a couple of really important things here, Andrew, which is, if you talk about architecture firms for... we just start there, you're not trying to go around them, you're trying to create pull through. And I think for any manufacturer out there that's trying to launch a new product, you have to create pull through from that final end user, whether it's a homeowner or the person... maybe the building owner, somebody like that. It's a lot easier to start there, because getting an architecture firm to advocate for you, unless they have a pre-established relationship, it's challenging. Zach Williams: Like, the architecture firm, how many times do you go in there and you meet with somebody like, "Oh my gosh, we love this. We can't wait to specify it." And then it's crickets. It's because they're scared, you have a new product. Andrew Legge: A hundred percent. Yeah. Zach Williams: That their name is on the line. So it's very different. And the other thing you're talking about, which I think is also so important is that you know how much ROI you're going to get if you spend it online, and that's why I really believe like, we're in such a golden age of advertising. Because you can measure out, okay, if I spend this amount, I'm going to see this kind of return. There's no question, there's no guessing. That doesn't mean you're not experimenting and trying new things. But if you want to continue to scale, you just had to find new avenues where you can see that kind of return on investment. Right? Andrew Legge: I totally agree. There's that blind faith element that's really hard. And lucky for me, I've known the guy who runs our marketing for almost 30 years. And he just sort of looked at me and said, "Look, we're going to do this. Trust me, it's going to work." And I never said, "Hey, it's been this amount of time and we haven't seen anything." I just kept doing exactly what he told me to do. We did it blindly as an organization. We measured along the way. Right? It wasn't like, "Let's just roll the dice and we'll see what happens." But I trusted him implicitly to get us to some place where there would be some real metrics, and we got there. And guess what? We still try every day and- Zach Williams: You still try, you still fail, you get up, you try again. Like, experimentation is critical. It's critical. Andrew Legge: Also, the world that we're living in, the platform that we're trading on is dynamic. It's changing. And guess what? Guess what? The guys at Google are really smart. Who knew? They change the rules too. So you can't just have this channel that's working and pile into it and let... Hey, we did this for this calendar years and it works, so let's double up next year because they might change that. And so you've got to stay nimble, you've got to stay aware. And then I think you just have to trust the platforms. If you've got the product then... You can't blindly believe in your product. Right? But what we did, even though we got our asses kicked for four years, we had this view that we've got a natural and high performance product here. We would equate it, very simplistically, to the movement in food. Right? Zach Williams: Yep. Andrew Legge: In those days, Whole Foods is growing, McDonald's is shrinking. Right? People care more about their health, and they're not realizing that the environment around them, let's call it their home, maybe a really unhealthy place. Zach Williams: You don't think that COVID-19 is going to help your business? Andrew Legge: I think it probably will because- Zach Williams: It probably will. Andrew Legge: ... really focused on health and wellness, which is where we were before this, and I'm sad that we're going through it. But yeah, I agree on some level, people are going to start thinking about even more so what their surroundings are. Zach Williams: See, this is why... And I say this all the time, Andrew, but the best product doesn't always win. Like, most manufacturers I talk to think they have the best product. And my response is, "Well, if you have the best product, why aren't you selling more?" It's typically the best promise that wins, not the best product. And if you've got the best promise, which is what you guys are really focusing on, you're going to win in a long game. Andrew Legge: Our mantra is... it's pretty simple, it's, make informed decisions. Right? And so people aren't thinking about this, they're not thinking about the materials in their house and how toxic they might be. Right? So come and talk to us and we'll tell you everything we know. We're not going to make anything up, we might not be able to answer all your questions, but we will tell you what we know about the space. And if you go away and you still buy fiberglass, great, at least what you're getting yourself into. Because the architect and the builder and the installer, they're not going to tell you what the ramifications are of some of these products. And they're certainly not going to talk much about the performance, because they're putting them there. Zach Williams: Yup. Andrew Legge: Right? And so they're not going to tell you that... they're not going to show you the pictures of foam molding or fiberglass molding, or how fiberglass stops working over time because it's such a weak fiber. So we're just here to say, "Look guys, here's the deal. Here's how it all works. If you want to put some wool on the structure, great. But if you don't, at least know what you're getting into." And that is very much a long game approach, and we decided early on, that's the one where you're going to take. The other thing, to be very clear, is we didn't set out to take five or 10% market share. US insulation market is about $16 billion. It's massive. Zach Williams: Huge. Andrew Legge: Right? So our goal is to have like half a percent. So what we're really striving for is the discerning customer who wants better and realizes... Because, of course, better always costs more. That's true in this case as well. Right? But, if you keep things in context insulation's typically 1.8% of construction costs. Right? So if you pay a little bit more for wool versus fiberglass, it's a rounding error on your construction budget. Zach Williams: But your laser-focused on who you want to go after. You know exactly what your audience is, which helps everything. I'm sure marketing helps your sales, helps your positioning, your message, everything. We're not ready for everybody, we're only ready for these people. Andrew Legge: No, no, no. And interestingly enough... So people will take that information and they will understandably extrapolate that we're just chasing rich people. And the fact of the matter is, that's not true at all. We're chasing people who are aware, who are intelligent, who are educated, who are not trying to impress their friends with a 10,000 square foot house, but are living in a totally bomber 2,500 square foot house that's designed perfectly and built perfectly. Zach Williams: There you go. Andrew Legge: That's our customer. And those guys aren't that hard to find. Zach Williams: Well, Andrew, man, thank you so much for coming on the show. This has been awesome. If someone wants to connect with you, what's the best way for them to do that? Andrew Legge: We try to make ourselves readily available. I will say that we get a lot more inbound than we used to, by design. But if you're on our website, it's www.havelockwool.com. Our phone number is on there, our emails are on there. We're fairly active on Instagram. We try to direct-message with people who shoot notes to us. And like I said, we're here to help people make informed decisions, and if that ends up including some wool, great. And if it doesn't, we really enjoy the whole conversation around the built environment. So hopefully, people can find us relatively easily. Zach Williams: Excellent. Andrew, again, thanks so much for coming on the show. This has been awesome. If you want more great content like this, go to vemveo.com/podcast. Until next time, I'm Zach Williams. Thanks everybody. Voiceover: You've been listening to Smarter Building Materials Marketing, with Zach Williams and Beth PopNikolov. To get the resources mentioned in this podcast, visit venveo.com/podcast. Thank you for listening.
More About This Episode In this episode, Zach talks to Andrew Legge, Founder and Managing Partner at Havelock Wool, about the unique promise he makes with his commodity product, and how that is turning into incredible sales and brand loyalty. Transcript Zach Williams: I like to say that the best promise wins, not the best product. And what I mean by this is that most manufacturers are incredibly focused on having the best product in the industry. And yes, that is important; your product should perform. But at the end of the day, your product can perform, it can have the best features, but if your promise to your customer does not resonate, it doesn't matter. The promise you make to your customer, across the entire sales channel, has to work in order for you to move product. And on today's episode, I talk to a guest who has an incredibly unique promise I'm really excited to share with you for his commodity product. He's selling direct, making it easy for customers, and making this company a success in the process. It's a super relevant podcast for anybody who's looking to improve their messaging, improve their marketing, and create a promise that resonates with their audience. All right, let's get into the show. Voiceover: Welcome to the Smarter Building Materials Marketing Podcast, helping you find better ways to grow leads, sales, and outperform your competition. And now, here are your hosts, Zach Williams and Beth PopNikolov. Zach Williams: All right everybody, welcome to Smarter Building Materials Marketing, where we believe your online presence should be your best salesperson. I am Zach Williams, and we have a great show lined up for you today. We've got Andrew Legge, who's a managing partner at Havelock Wool on the show with us today to talk about their marketing and sales and how they've grown. Welcome to the show, Andrew. Andrew Legge: Thank you very much for having me, delighted to be here. Zach Williams: So Andrew, for our listeners, why don't you share with us a little about Havelock Wool, how you all got started and who you all sell to, and then we'll dive in a little bit about your marketing. Andrew Legge: Yeah, sure. There's kind of a long story for how we got started, so I'm going to make it short so we don't bore anybody. But essentially, I was leaving a former career in private equity. I had developed a love affair with all things New Zealand, and so transitioning back from living in Asia for six years, I went and spent some time there and really started to nose around on some theories that I had about small business opportunities. In fairness, I had no view towards insulation, and I met some people who were trying to do something in this regard, and I got very excited about it. Andrew Legge: So a couple of years later, after doing a lot of homework, a lot of diligence and having a lot of conversations around what kind of market opportunity there might be for this product, we decided to launch the company. That was in October 2013. We followed what I would say are traditional channels to market, i.e lots of meetings and lunch and learns with architects and builders and insulation installers. And we found that we got a great reception, but it did nothing for us from a sales perspective. And so as this world has evolved, we were quite happy to stick our nose into this constantly changing dynamic, really fun environment around digital marketing. I would say we kicked off those efforts about two years ago, and we saw a dramatic change in awareness interest and sales for our business on the back of those efforts. So- Zach Williams: Who are you marketing to? Andrew Legge: We market, essentially, to the end user. Zach Williams: Okay. Andrew Legge: And as you know, probably better than us, this is sort of a complex channel, and there are lots of "interested parties", but let's just call them participants, in that channel. And what we have found... And this happened early, even though we weren't focusing on it, just because we have lots of friends. Anytime we knew the end user of the product, everything went really well. So, the builder might not like it, because it's something new and different, but guess what? The builder doesn't get to care, because the end user is making the decision. So we always knew that that was a good place for us, but it just didn't seem like a very effective way to run around and look for people who had a building project going Zach Williams: Sell by one, by one, by one, versus get in with somebody who's advocating for you? Andrew Legge: Yeah. To be honest, I was wrong, to some large degree, in that aspect, because I've never been a B2C person. And to me, it just seemed... Like, following the traditional channels of trying to get somebody to read an article about what we were doing, great, they might really enjoy hearing and learning about Havelock Wool, but if they're not building something at the time, then who cares? Well, of course, we always knew that there was this search engine called Google. Zach Williams: It's a beautiful place. Right? Andrew Legge: Yeah. But what we didn't appreciate... or let me say, what I didn't appreciate is that somebody typing in, healthy insulation, or alternative insulation, or green insulation into a Google search is in market. Zach Williams: Oh, they have intent. Andrew Legge: Yeah. Zach Williams: We talk about that all the time. Like, that person has intent to buy something that solves that problem. I mean, it's very different than, let's say social, which granted, you can drive a ton of sales and a ton of demand from social, but it's a totally different game. Andrew Legge: Yeah. And so that is where the discussion sort of started. Right? Like, I'm in Google, I'm looking for a healthy alternative, and we just sort of let that snowball on itself. And that has led us into lots of different places. But again, really, we're talking home owner and a market that randomly developed for us is... I don't know if you're familiar with all of this enthusiasm around van conversions. Zach Williams: Yes. Isn't it wild? Andrew Legge: Yeah. Well, so I always wanted one. And so in 2016, I bought one for myself, I insulated it with wool for fun, because it made sense, and it's a condensation trap, and wool is great with moisture. And so I drove it around for a year and a half and finally, at one point we were like, "You know what? Maybe we should market into this space." And it's becoming not insignificant line item to our business. And so again, that's an end use, and that's really interesting, actually, from a marketing perspective, because the ecosystem that exists around social and DIY and sharing within that world is wide open, and everybody knows where to find everybody and everyone's friendly and they're really trying to help one another. Basically, that's become a testing ground for us. So we try something new there and if it works, we pull it into our residential space, which, of course, is the lion's share of our business.
Source Zach Williams: Wait. Can I just pause on that real quickly- Andrew Legge: Please. Zach Williams: ... to make sure I understand this, Andrew? Your testing ground for your product are vans. Is that correct? Like, converted vans? I'm thinking about like Free Solo, the documentary. Andrew Legge: No. So our testing ground for marketing is the van world. Zach Williams: Gotcha. So like, you test your marketing there- Andrew Legge: Yup. Zach Williams: ... then you expand out. Andrew Legge: Yeah. So here's the perfect example. Direct to consumer, for manufacturers, is becoming a thing. Right? Zach Williams: Yes. It's huge. Andrew Legge: And I don't see a fiberglass insulation manufacturer gaining a lot of traction selling direct to consumers, because the reality is most people want to pretend that stuff doesn't even exist. Now, it's a necessary product that we need to have in the built environment. Sure. Right? I'm not trying to- Zach Williams: Yes. Andrew Legge: ... say we're here to replace those guys. Right? But our experience is, we will get people in our office that we can't get to leave. They want to stand around and talk about installation all day long. And nobody does that with fiberglass. At least nobody that I know, or I've ever met. And so as this whole story has evolved, we've taken this thing out to say, "Hey, we can sell direct to consumers, so we have our distributor friends." But particularly, here is a perfect example in the van life space. We put a shopping cart on our website, and we made it very clear for you, as a van lifer, what you need based on what your van is. And you can now come on our website and you can buy, right there, the amount of insulation you need for your van, and we mail it to you. Zach Williams: Wait, I need to check this out right now. Andrew Legge: So go to Havelock Wool, and then you'll see van life. Zach Williams: Buy for your van. You literally have a link at the top of your page. Andrew Legge: Yes. Zach Williams: You can see the different amount of bags that you need for every van. You got videos, installation, how to insulate, all the benefits. How does this page rank on Google? This has got to rank really well. I mean, you have so much content on this page. Andrew Legge: We do, and we're constantly trying to improve that. We actually just put out a bunch of videos last week that we're pretty excited about, to help people on the install side of things. Zach Williams: This is fascinating. So this is like your micro chasm of like people that may like your product, that you test everything on, and then you roll it out to the masses? Andrew Legge: Yeah. Zach Williams: How did you stumble on this? Like, this is the wildest thing ever. How did you stumble on this? Andrew Legge: We just organically created it, and we did it slowly. We do everything slowly. I'm pretty conservative. We listened to people, we took our experience, and we tried to drop it into what you're looking at. Right? So, take it back to when we first... when we hired Josh, who runs our sales. In his early days, he would spend an hour on the phone with somebody who wanted to buy two bags for their van. Well, you can still call us and talk to us, we do it all day long, but what we've tried to do is put all of that information right in front of you, right? In what you're looking at right now. So if you don't want to talk to us, you don't have to. Zach Williams: You don't have to. Frankly, it's not rocket science. Andrew Legge: Nope. Zach Williams: But it is... it's that convenience component, like, how can I give people that are searching for my information access to the answers, to the questions they have, right in the moment, without having to talk to somebody? Andrew Legge: Totally. And it's like your piece on the architects, that we were just talking about, and who it is that you're trying to connect with. It's the person who's sitting there that wants to do lots of research and know a lot of things before they talk to you. Right? So that's what we're trying to do, say, "Here's everything you need to know. You can buy, right here, if that's good enough for you. Or, if you want to pick up the phone and call us, feel free." Zach Williams: So, talk me through how you're taking this information from... You've got this small group of people that are... Would you call them your brand advocates or as like, just your testing ground? How do you internally refer to them? Andrew Legge: They are van life buddies. Zach Williams: That's so funny. So how do you take that and then roll it out to like the masses? Give me an example. What does that look like? You learn something like, Hey, it insulates the van well, and people like it this way, and so clearly it'll work in a residential space? Andrew Legge: Well, so the dynamics of a wool fiber are really second to none. Right? It's evolved across thousands of years as an insulator. So, we're lucky that we've got this amazing product that fits in lots of aspects. Right? And moisture management is a key component of what wool inherently does on its own because of the five follicles in the fiber. And so if you take a van and you think about driving that thing around in all these different environments, it's going to create a lot of condensation. Right? And so I put it in the floor of my van and when I redid it two years later, I pulled it up and I videoed it, and the bats were literally just as I left them. They were still the same color, there was no breakdown, there was no mold because water had seeped through, because I'd use it to go skiing all the time. It was literally just as if I put it in yesterday. Andrew Legge: We don't get very deep in the building science discussion within vans, except for when people call us and say, "What do I do with the vapor barrier?" And we tell them to either leave it on the shelf at Home Depot or put it in the garbage, if they've already bought it. But that discussion then very quickly transcends into the airtight way in which we're trying to build homes, and that's where we spend a lot of time in the building science discussion and we talk about vapor variability. And again, we're talking about indoor air quality issues, where, of course, these speak to the advantages of wool. We don't do that because it's a hardcore sales thing, it's because it's what we think people want to know and understand and deserve to know, that there are high performance, natural alternatives to insulation. Andrew Legge: Now, specifically, from a marketing standpoint, to be honest, it's what stretches our minds every day, because that ecosystem that is so great within the van life world doesn't exist in the residential world. It's highly fragmented, and there are interested parties with different motivations and measures for success across the entire process of building something. What we have found is that the trade is way behind the consumer. There are very "well-educated", intelligent architects who have no idea what material specification looks like. Andrew Legge: To me, I'll make this personal, so I'm not trying to speak for anyone else, that's just not good enough. When you look at what the built environment looks like today, how it's going to double over the next 40 years, and you're talking about 2.4 trillion square feet, and you look at GHG emissions, and the fact that the built environment is 40% of that and 11% of that figure is materials, we need to be doing a better job with material selection, and that falls on the desk of the architects, as far as I'm concerned. So, we spend an increasing amount of time on that piece- Zach Williams: Educating them? Like, how to educate the... Andrew Legge: Absolutely, educating. So for example, we started at the end of last year and we're doing an LCA EPD with Sustainable Minds, and that will greatly increase the necessary elements to that conversation for us to try and speak the same language to those guys. So we're not like pounding the table, like, "You need to do better," we're pounding the table saying, "It would be great if we can help you expand your horizon to understand how important this stuff is." Zach Williams: Before we started talking, before we were recording here, Andrew, you were talking about, you were having a difficult time getting in front of architects. You flipped your marketing on its head, you started doing digital, creating pull through, how are you getting architects to listen to you? How are you getting in the door with them, today, versus when you first started? Andrew Legge: To be honest, getting in the door has never been the problem. They are always happy to have you in and have you tell them about a product. Zach Williams: It's getting specified? Andrew Legge: Yeah, exactly. It's getting specified, it's getting traction after those discussions, and that's what we have not seen happen. Zach Williams: What did you do differently to start making that happen? Is it just you're creating the homeowner to create pull through? Andrew Legge: Yes, a hundred percent. Zach Williams: It's all homeowner pull through? I want this product- Andrew Legge: A hundred percent. Zach Williams: ... I don't care a builder, architect, contractor that you don't want it, I want this. Andrew Legge: Yeah. I'm paying the bills, I want it, get it in my house. Zach Williams: So how are you getting in front of homeowners then, at a scale, without to like sell one on one on one on one? Andrew Legge: To be honest, that goes back to the content creation and the digital marketing. We're a small business, so it's all relative. Right? But for us, we spend a lot of money on ad words. We've got ads on Facebook, we're active on Instagram, and we are using those channels to get in front of people who are in process and in market. And that's been a big learning curve for us. Right? Because we were looking at sort of traditional channels not appreciating that you don't do a lot of insulation research on a Sunday afternoon for fun. Right? Zach Williams: No. Andrew Legge: When you want something in the building material realm, you're doing research because you're going to buy it. And so we're trying to make sure that we're present in that discussion and in that search.
Source Zach Williams: So is there like a tipping point for you, when you started to really use and leverage digital, that you started to see people increase demand, specifically homeowners? Was there something you did or a strategy that you changed? What was that? Andrew Legge: So, a hundred percent. The first thing we did was we spent a couple of years kind of getting beaten up by this whole thing and trying to figure out the manufacturing side of things and following those traditional channels, and frankly, being led astray a bit. Because we would go have these meetings, people would tell us that they loved what we were doing. Zach Williams: And then you wouldn't get the sale. They wouldn't ever specify. Andrew Legge: Exactly. Then they just wouldn't use us. So there's only so many times you can do that before you're like, "Wait a minute. This isn't going to work." So it was an element of, do we want to keep pounding our head into the same wall, or do we want to try something different? And so we didn't run in another direction and say, "Hey, forget all you guys." We just said, "Let's sort of try this and see what happens." And we rebuilt our website. We hired a digital marketing firm, we got in the conversation and got ourselves on that learning curve for understanding how we could get in front of people. I did that on the back of hiring a full-time salesperson. And six months later, we hired a full-time marketing person. Andrew Legge: Those guys, again, were lucky, because we've got this amazing product... Not to take anything away from those guys, because I think our team is amazing. It's small, but we're nimble and we learn quickly. And I think that we can create a lot of disruption in this space because we have the product, it's one that people care about, want to talk about, don't want to run away from, and we're very quick to see the world for what it is, what may or may not work, going forward, in our view. And then because we're nimble, we can quickly adapt to these new platforms and test them. That's the beauty of it, right? You can test it and understand it, see what works and see what doesn't work in a very short period of time without spending a ton of money. And then you can very quickly kind of layer onto what's working while you're backing away from what isn't. Andrew Legge: About two years ago, we sort of upgraded everything internally, from a systems perspective, and really started to go after this. But, again, we're small business, we've got a lot of guys working in the back in production, so our burn rate is high. So we had to sort of ease our way into it, and we continue to do that. But after that lag effect of, call it three to six months, you start selling, and you start looking at these very real metrics, which is really fun. Zach Williams: Where are you driving the most demand from? What different avenues are creating the most traction for you? Is it Google? Is it social? Is it email? Is it content? What's working best for you? Andrew Legge: The easy answer is Google. Zach Williams: Okay. Because it's very bottom funnel. Andrew Legge: It is. Zach Williams: And what are you trying to push them to? Are you trying to push them to a sample request, a phone call? What are you trying to get that user to do? Andrew Legge: We want them to let us know that they're interested in learning more from us. Zach Williams: So do you give them like a video, or what does that look like? Andrew Legge: So, we change it around. Right? But ultimately, we want the form fill that says, "We want to know more about Havelock Wool." Zach Williams: Okay. Andrew Legge: And we're not trying to trick anybody, but it'll look different on Facebook, because that's a different audience, than, say something coming direct out of Google. Definitely our best return on spend, if we measure it directly, is out of Google. But there's this also... this somewhat intangible of how much does Facebook Ads feed that direct search for Havelock, which is not getting attributed to Facebook, but is coming up through direct. Like, now I'm in Google looking for Havelock Wool and now I'm a buyer. We've literally seen people come in that way. We've seen people on a $3 click lead to a $26,000 sale. Zach Williams: There you go. Andrew Legge: This is our best metric so far. But we've seen a host in the five to $16,000 range. So right now, we have a return on ad spend that just falls shy of six times, and so it puts us in a very interesting place when we delve back into this traditional way of doing things. What I mean by that, if somebody calls and says, "Hey, we're hearing great things about Havelock Wool. How about you guys come participate in this conference?" And I'm not trying to be flippant, right? But I have to ask a question like, okay, here's the rough amount of money you want me to spend. If you think I'm going to stand around the coffee pot and glad-hand people for that amount of money, I'm not going to. Zach Williams: No. Andrew Legge: Right? Zach Williams: Not a chance. Andrew Legge: You've got to offer me more, because I know if I spend $7,000 in these channels that I'm using actively, I'm going to make six times my money, almost six times. Zach Williams: See, you're hitting on a couple of really important things here, Andrew, which is, if you talk about architecture firms for... we just start there, you're not trying to go around them, you're trying to create pull through. And I think for any manufacturer out there that's trying to launch a new product, you have to create pull through from that final end user, whether it's a homeowner or the person... maybe the building owner, somebody like that. It's a lot easier to start there, because getting an architecture firm to advocate for you, unless they have a pre-established relationship, it's challenging. Zach Williams: Like, the architecture firm, how many times do you go in there and you meet with somebody like, "Oh my gosh, we love this. We can't wait to specify it." And then it's crickets. It's because they're scared, you have a new product. Andrew Legge: A hundred percent. Yeah. Zach Williams: That their name is on the line. So it's very different. And the other thing you're talking about, which I think is also so important is that you know how much ROI you're going to get if you spend it online, and that's why I really believe like, we're in such a golden age of advertising. Because you can measure out, okay, if I spend this amount, I'm going to see this kind of return. There's no question, there's no guessing. That doesn't mean you're not experimenting and trying new things. But if you want to continue to scale, you just had to find new avenues where you can see that kind of return on investment. Right? Andrew Legge: I totally agree. There's that blind faith element that's really hard. And lucky for me, I've known the guy who runs our marketing for almost 30 years. And he just sort of looked at me and said, "Look, we're going to do this. Trust me, it's going to work." And I never said, "Hey, it's been this amount of time and we haven't seen anything." I just kept doing exactly what he told me to do. We did it blindly as an organization. We measured along the way. Right? It wasn't like, "Let's just roll the dice and we'll see what happens." But I trusted him implicitly to get us to some place where there would be some real metrics, and we got there. And guess what? We still try every day and- Zach Williams: You still try, you still fail, you get up, you try again. Like, experimentation is critical. It's critical. Andrew Legge: Also, the world that we're living in, the platform that we're trading on is dynamic. It's changing. And guess what? Guess what? The guys at Google are really smart. Who knew? They change the rules too. So you can't just have this channel that's working and pile into it and let... Hey, we did this for this calendar years and it works, so let's double up next year because they might change that. And so you've got to stay nimble, you've got to stay aware. And then I think you just have to trust the platforms. If you've got the product then... You can't blindly believe in your product. Right? But what we did, even though we got our asses kicked for four years, we had this view that we've got a natural and high performance product here. We would equate it, very simplistically, to the movement in food. Right? Zach Williams: Yep. Andrew Legge: In those days, Whole Foods is growing, McDonald's is shrinking. Right? People care more about their health, and they're not realizing that the environment around them, let's call it their home, maybe a really unhealthy place. Zach Williams: You don't think that COVID-19 is going to help your business? Andrew Legge: I think it probably will because- Zach Williams: It probably will. Andrew Legge: ... really focused on health and wellness, which is where we were before this, and I'm sad that we're going through it. But yeah, I agree on some level, people are going to start thinking about even more so what their surroundings are. Zach Williams: See, this is why... And I say this all the time, Andrew, but the best product doesn't always win. Like, most manufacturers I talk to think they have the best product. And my response is, "Well, if you have the best product, why aren't you selling more?" It's typically the best promise that wins, not the best product. And if you've got the best promise, which is what you guys are really focusing on, you're going to win in a long game. Andrew Legge: Our mantra is... it's pretty simple, it's, make informed decisions. Right? And so people aren't thinking about this, they're not thinking about the materials in their house and how toxic they might be. Right? So come and talk to us and we'll tell you everything we know. We're not going to make anything up, we might not be able to answer all your questions, but we will tell you what we know about the space. And if you go away and you still buy fiberglass, great, at least what you're getting yourself into. Because the architect and the builder and the installer, they're not going to tell you what the ramifications are of some of these products. And they're certainly not going to talk much about the performance, because they're putting them there. Zach Williams: Yup. Andrew Legge: Right? And so they're not going to tell you that... they're not going to show you the pictures of foam molding or fiberglass molding, or how fiberglass stops working over time because it's such a weak fiber. So we're just here to say, "Look guys, here's the deal. Here's how it all works. If you want to put some wool on the structure, great. But if you don't, at least know what you're getting into." And that is very much a long game approach, and we decided early on, that's the one where you're going to take. The other thing, to be very clear, is we didn't set out to take five or 10% market share. US insulation market is about $16 billion. It's massive. Zach Williams: Huge. Andrew Legge: Right? So our goal is to have like half a percent. So what we're really striving for is the discerning customer who wants better and realizes... Because, of course, better always costs more. That's true in this case as well. Right? But, if you keep things in context insulation's typically 1.8% of construction costs. Right? So if you pay a little bit more for wool versus fiberglass, it's a rounding error on your construction budget. Zach Williams: But your laser-focused on who you want to go after. You know exactly what your audience is, which helps everything. I'm sure marketing helps your sales, helps your positioning, your message, everything. We're not ready for everybody, we're only ready for these people. Andrew Legge: No, no, no. And interestingly enough... So people will take that information and they will understandably extrapolate that we're just chasing rich people. And the fact of the matter is, that's not true at all. We're chasing people who are aware, who are intelligent, who are educated, who are not trying to impress their friends with a 10,000 square foot house, but are living in a totally bomber 2,500 square foot house that's designed perfectly and built perfectly. Zach Williams: There you go. Andrew Legge: That's our customer. And those guys aren't that hard to find. Zach Williams: Well, Andrew, man, thank you so much for coming on the show. This has been awesome. If someone wants to connect with you, what's the best way for them to do that? Andrew Legge: We try to make ourselves readily available. I will say that we get a lot more inbound than we used to, by design. But if you're on our website, it's www.havelockwool.com. Our phone number is on there, our emails are on there. We're fairly active on Instagram. We try to direct-message with people who shoot notes to us. And like I said, we're here to help people make informed decisions, and if that ends up including some wool, great. And if it doesn't, we really enjoy the whole conversation around the built environment. So hopefully, people can find us relatively easily. Zach Williams: Excellent. Andrew, again, thanks so much for coming on the show. This has been awesome. If you want more great content like this, go to vemveo.com/podcast. Until next time, I'm Zach Williams. Thanks everybody. Voiceover: You've been listening to Smarter Building Materials Marketing, with Zach Williams and Beth PopNikolov. To get the resources mentioned in this podcast, visit venveo.com/podcast. Thank you for listening.