E226: Morli Desai Discusses Her Journey in Acquiring and Revitalizing a Skincare E-commerce Business

[00:00:00] Ronald Skelton: Hello and welcome to the How2Exit Podcast. Today, I'm here with Morli Desai. She has acquired a company a couple of years ago. We're going to discuss what that was like, what the process was like, what did she do before, and then kind of what she's going through now. So that we can all learn from her journey and,and see where she, what she's up to and where she's going.

Thank you for being here today. If we're going to be this rough at the beginning, we're going to have a little adventure here, but we'll just laugh at it and keep moving. Morli, thank you for being here.

[00:00:28] Morli Desai: Yeah. Thank you, Ron. I love having these conversations. So I'm very excited.

[00:00:34] Ronald Skelton: Cool. People learn a lot from others that are in the,in the gear, in the motion. You've acquired something that looks like you said, 2022, so you've acquired it two years ago. Let's go a little further back. Kind of give the audience a sense of who you are, your origin story. If you listen to any of my shows, you hear my joke.

I say, Hey, you were born and then you ended up in a show about mergers and acquisitions. Could you fill out the show? Can you fill out the gap in between? How in the hell in the hell did you end up on an M and A show? 

[00:00:58] Morli Desai: Yeah, happy to share. So, um, I, I come from an immigrant family. My parents both immigrated from India in the seventies right before I was born. And my mother was an entrepreneur. Well, she started her business actually when I was like middle school, high school. She was a CPA and accountant worked for, FDIC, the big government agency that insures our money.

And then ended up leaving and then opening up her own business. And so I got to witness her firsthand what that journey was like. And then, and it was a family business, right? Like I was free labor at the time. So I remember stuffing envelopes with marketing materials and like helping her organize people's like receipts and stuff for their tax returns. 

And, but I really loved watching how she grew in to being successful business owner. And then as a foil, my dad was a pharmacist and, had a good job. Very stable, but it was shift work for him. I didn't see that same excitement about building something and the respect that she got from her clients.

And so that stuck with memy whole entire life and I ended up going to college and majoring in business. Wanted to be an entrepreneur, but never had that brilliant idea. So I was like, well, let me go and work. And I went and worked on wall street. I love numbers and analytics. Did that for a couple of years and then decided to come back and get my MBA.

Went to Wharton and did that. And again, no brilliant idea crossed my path. Cause I thought to do entrepreneurship, you actually have to start something. And then worked, graduate in 2009 where the economy wasn't super great. So worked for a big corporate,Medtronic, a medical device company. And it was always in my head.

I'm going to just be there for a couple of years and then I'll leave. And then you've five years came and I got promoted and then 10 years came and I got promoted again. And then I had my two babies and finally, May 2020, I always kind of likened that as my freedom date. I decided to go ahead and just quit and begin my entrepreneurship journey.

There was a couple other factors that kind of went into that. One was getting unmarried. Two was my youngest son, finally turned one. So I wasn't like a baby factory anymore. Oh, by the way, we had this thing called the pandemic and it caused a lot of people to really stop and take stock. 

And so that all together just made me take the plunge. And so I spent about a year and a half looking for a business. And then worked with a bunch of business brokers. And then decided that I wanted to do e commerce because it fit my skillset in terms of marketing and operations. And it also gave me the lifestyle that I was looking for as a single mom now, and acquired it in, in 2022.

[00:03:58] Ronald Skelton: So in 2022, what did you acquire? What was the e commerce market space? I mean, what industry were you in?

[00:04:06] Morli Desai: Yeah. So it, it's a niche skincare business and, and what was really exciting about this is that it had, the brand was started in 2017 and it kind of had, you know, it was a half a million, a million in revenue. And then COVID just really exploded it. And they had, 20 was really great. 21 was great.

22, their run rate was even more phenomenal. And so, I thought that that was a new normal that e commerce was going to be the new way that peoplepurchase things. And we didn't know how long the pandemic was going to last. Like, you know, yes, we have the vaccine at that point, but it had really changed a lot of our normal behaviors.

And so, and one of my passions actually through COVID was skincare, right? You're on zoom all the time. You're looking at your skin, you're seeing like all your flaws. And so, it was when I really invested in my skincare and then fight to find a company that could be something that I could invest in, was a perfect match.

And so that was kind of what inspired me to go ahead and take the plunge and purchase it.

[00:05:13] Ronald Skelton: So niche skincare, is that a, is it, is it moisturizers? Concealers? I mean, I know nothing , so I, I, the reason I run a podcast is that people often categorize me as insanely curious. I'm just constantly curious about all kinds of stuff.

[00:05:28] Morli Desai: the company's name is a Amaira Natural Skincare, A M A I R A. And we lighten, tighten, and brighten your most delicate areas. So it's actually an intimate skincare company. And I focus specifically on hyperpigmentation. So, my goal is to help women get their confidence back and feel authentic in their skin by evening out their skin tone, which is one of the big, indicators of just getting older, our skin starts to get a little bit more splotchy, sunspots, age spots, things like that. 

And so I have my natural skincare line uses plant based extracts and it works to even out the skin so that women can show up more confidently and authentically in the world. 

[00:06:19] Ronald Skelton: So I'm interested in that. My wife's just teasing me beforehand. Like I know nothing about the space. I know that my wife's seeing how baggy my eyes have been getting because of the allergies and I'm 52, right? And I've never put a moisturizer on me other than any type of dry patch I get from like, what they call it, eczema or whatever that, my immune system, you know, gives me a dry patch.

Again, I put lotion on those because they itch, right? 

[00:06:39] Morli Desai: Yeah. You're eczema. Yep.

[00:06:41] Ronald Skelton: The eczema whatever. So if I get a little patch like that, actually, I just noticed I had one of my wrist there. I get anything like that then I, of course, there's a lotion. I put it on that, but, I've never, I think probably count the time as I put lotion on my face on a single hand, and not need all my fingers.

Right? So, that said, she, I was telling you beforehand, she put this stuff up, she roller ball underneath my eyes. And,she's like, this will help get the bags underneath your eyes. And it was like, at first I was like, I don't want to put on makeup. She's like, oh, it doesn't have any color in it.

Two days later, she's in like, what are you doing? 'Cause I'm in there with her roller ball 'cause I was like, I've seen it now.Now that I know it's there, like I, I was like, man, I do have bags underneath my eyes. They look horrible today. And I'm like, and then she's like, try this.

And she pulls out this ice cold thing outta the refrigerator that's got I that's a jade, a roller. She's like, you roll cold on it. And I was like, okay, now we're getting a little, I'm not gonna go too metro. I'm an old, uh, hairy old man here. But, I would like to, some of the, some of this stuff makes sense, right?

[00:07:34] Morli Desai: But I'm actually more interested in your eczema. So you know, which a lot of my customers have eczema and specifically when you get those dry patches and you're using the moisturizers rightto heal it, a lot of times that eczema can leave behind hyperpigmentation. Where the skin, when you've got like a scar, right?

The skin's a little bit darker. And so a lot of my customers that have eczema then use our products to help lighten the, basically when your skin heals, it, it overproduces melanin to help with the healing process. And then, then it becomes a dark spot. And so the eczema actually is, it's a key focus for a lot of my customers.

And so I'm happy to send you some product. If you've got, if your eczema is leaving you spots afterwards, because people can be, it can be a confidence killer if you've got these dark spots all over. 

[00:08:29] Ronald Skelton: So 2022, you buy this, COVID's going, we're learning a lesson. Now, those of us are current looking, looking at all the people I have on the show now, and even including myself, if a broker shows me numbers and it goes like 20, 21, 22, and they don't want to show me 23 or 24, I'm like, whoa, whoa, whoa.

You know, it's like we're far enough away, but even closer, like in 2023, we would try to normalize things. We started, we started to pick that up fairly quickly that, this run up may not stay flat. May not even flatten out, it may recede. And it sounds like to me that yours ran up, but then it receded back down.

What's happened since the, uh, acquisition?

[00:09:08] Morli Desai: Yeah. I mean, Ron, you kind of nailed it, right? Like, we thought that the runway that the company had was a function of, how well the business was doing. And now going through 23 and almost halfway through 24, we have receded to pre COVID numbers. And I realized how much COVID was boosting the business.

And a part of it is just decisions we've made.When I bought the business, it was mostly driving its new customer acquisition through paid advertising. And the paid advertising was very cheap, in 20, 21, 22. And my costs for paid advertising have, almost tripled. And so it's also a function of advertising has gotten so much more expensive.

And so in order to make sure the company stays profitable, we've had to pull back on that advertising spend and that's just continued the top line to decrease. And so, yeah, I wish I wasn't, but I'm in a turnaround situation trying to get the company back to when I just bought it, where initially my vision was great, I'll buy it.

And then I will, you know, the owner was only working five to 10 hours a week is what he told me. And so I was like, gosh, like if I put all of my effort behind this, I've got to be able to, to at least maintain and grow. And it's been a different situation where it's really been about understandingthe new dynamics and then working on a plan to turn around the business.

[00:10:40] Ronald Skelton: So there's a, the inherent part of me that wants to fix everything. So do you mind if we dive into this just a little bit? Because I have, my MBA,you did a Wharton, uh, MBA too. I didn't go to Wharton. I went to another school, but my MBA is in marketing. And I realized that my MBA in marketing made me a great employee for people like Coca Cola and all these big dogs, but when it comes to the small to medium businesses, it's almost worthless.

I got a great dictionary in my head, but the methods and procedures and branding and strategies they teach you at the MBA level, don't. turn sales the way that you need in a small company when you're trying to manage debt to income ratios and keep a profitable thing. So I went back out and I studied under guys like Jay Connery Livingston and learning, low cost, high impact marketing strategy became one of his coaches.

And I studied under Dan Kennedy to learn how to do copywriting. And what I can say is, on any of these platforms, let's say Facebook would be a good one. Facebook goes through cycles.

Sometimes you can find a niche inside of Facebook where you can spend $5a week on ads and just be killing it. But as soon as, as soon as the cycle goes through and people start seeing it, it's a competitive place. So meaning that people start bidding against those same keywords and bidding against those same ads and they drive your cost up.

So, the only game that can be played in there right now is like, I know people right now are killing it on TikTok, right? Cause it's, in that same zone or, you know, a $5 per week or $5 per ad per month, type of kind of thing will actually turn results, you almost have to have somebody in here that knows how to game the system. Like somebody on your team, that their job is to understand what's working right now. Cause whatever's working right now, may not work in six months and once they get something working right now they hand it over to somebody that just, just does that until it doesn't work. And they're out there testing all this, the little things around like what, what else might work? Oh TikTok just started allowing ads, you know let's try that.

What do you get, when you said the ads don't drove up I'm imagining it was probably facebook ads or was it google? 

[00:12:45] Morli Desai: So actually it was Google ads and what you said exactly is,is the situation I'm in. Like what worked previously is not working again. And so the previous seller was able to scale up the business just exclusively on Google ads. He had done Facebook and then with the iOS update, it had caused a huge disruption. And so he saw that Google was working and the cost per clicks at that point were so low because there wasn't a lot of people bidding on those keywords.

Right, fast forward, two years later. I'm competing against Amazon. I sell on Amazon and they're bidding up all my keywords. I'm competing against Walmart and Target and like platforms that are now getting in the game. And I'm competing against a lot of brands thatbefore we're doing a lot more top of funnel marketing and just with how tough it is with advertising costs, so expensive, they're pulling it back and focusing more on kind of mid and bottom funnel. 

And so that just, that's why I saw the cost per clicks go from 60 cents to almost a dollar and a half to $2.And that's exactly it. I didn't, I, when I bought the company, I thought it was pretty diversified in marketing channels.

I thought the Google ads were only 50 to 60 percent of what was driving the revenue. And I learned the hard way that it was actually 90 percent because, I saw my email revenue decline at the same rate. Realizing that the majority of my email revenue was coming from automatic flows. So people coming to the site and then getting like the welcome flow and the abandoned cart flows.

And that's all contingent on people coming to the site. And then my Amazon revenue decreased also, which was like, what is going on? And then I realized what people were doing was that they would see the Google ad, they'd open up Amazon, see that I was on prime, free shipping, and then they would complete their purchase.

And so as that traffic was decreasing, it was also decreasing the traffic to Amazon. And so, I learned the hard way of how exposed I was to one marketing channel. And that one marketing channel that had worked beautifully, previously, was not working anymore because of how expensive the keywords were. And so now we are on a strategy to actually invest in Meta, in Facebook and Instagram. And then, my core customer is more on that platform than Tik Tok, but after that we're trying Tik Tok and that's really now kind of the modern day playbook for direct to consumer brands. A lot of it has to be on social.

[00:15:38] Ronald Skelton: I'm wondering, and I don't even know if they do ads 'cause I've never been on there. Not that I've, I'm thinking of where the, where are people,YouTube would be big, right? 

So you were saying that TikTok didn't work or may not work. And your customer might not be there. Facebook is kind of your demographics. What is your, if you, if you had to give you like a, this is my persona, what is the average customer for you? 

[00:16:00] Morli Desai: Yeah. So I've got three main personas and my biggest one is me, honestly.Post maternity, late thirties, forties, is seeing the effects of the hormonal changes. You know, having babies, going through, uh, perimenopause. Seeing the effects of age, but wanting to invest in myself and feeling self conscious about some of those insecurities and wanting to do something about it.

So I, I like to tell my story a lot about, getting unmarried during the pandemic. Having my babies and then, putting myself first for the first time where I had always put myself last. And then just reinvesting in myself and my skincare and my wellness and looking for solutions for things that,don't make me feel good and, and finding a company that is all about helping other women do that. 

And so, yeah, so I, I feel very blessed that my key customer is me. And then I have another persona who is my 20 something. Who, also has insecurities, but it's a little bit more externally motivated, like they're looking for the real life filter, right?

The Instagram filter in real life. Though, they're on TikTok. So we're doing everything kind of in a very focused serial fashion. Where like, let's, you know, let's talk to the customers that are me because I can connect with them one on one and make sure that I am helping them to the best that I can. And then we'll turn our attention to TikTok because it is quickly becoming the fastest growing site. 

And then tick tock shop, right? A lot of people make their skin care and their purchase decisions now based on these platforms.

[00:17:45] Ronald Skelton: What percentage of your sales come from Amazon? Because that's dangerous too, if it's a real high percentage.

[00:17:50] Morli Desai: So when I bought the company, it was about 20%. It's now closer to 25 to 30%, just as I was mentioning the Google ads piece. But, but yeah, but the majority of our customers still are through our website.

[00:18:06] Ronald Skelton: And then I'm a huge fan of anything that's recurring revenue. Like subscription base and that type of stuff. Are your product stuff, people, are they consumable? People use them, they need another round of them? Or is it, you know, it solves the problem and, you know, all your sunspots are gone and you're never going to get any new ones.

[00:18:23] Morli Desai: I wish, I mean, I wish that for my consumer, but it's not true. Especially if what's causing the hyperpigmentation, right, isn't solved. And if, if you are not going out in the sun anymore and you're you and you're obsessive about using sunscreen, like maybe you could use it and not use it, but the truth is right that,hyperpigmentation is going to continue if the underlying thing continues.

And then you need to continue to use the products. And so, luckily from a business model standpoint,we do encourage people to keep, to keep using the product at least to maintain their even skin tone.

[00:18:58] Ronald Skelton: And you said there, it's a natural based product and stuff. So some of the people that, if you looked like who, what other products do people buy and where do they hang out? I'll only, I only know one makeup brand because that, that's of any kind, other than the stuff my wife leaves laying aroundthat's natural.

And it's because one of my friends, his wife used to work there in San Francisco as bare manuals. I don't even know if they're still around. But, so, anybody that would be ordering and using better minerals is probably be a target customer for you because they care about natural. They're care about looking good.

That would be, I don't know if you guys use competitive keywords in your searches and stuff, but if somebody is looking for bed, bare minerals or something else, that's a natural homopathic. Any in that space where they're worried about natural healing, natural health, natural makeup,those would be key phrases and stuff.

[00:19:44] Morli Desai: Yeah. and that's actually a really good point. And so, a key like competitive products that, that also help with hyperpigmentation contain a chemical in them called hydroquinone. And in many countries, this is actually banned. And in the U. S. you have to get a prescription for it over a certain effective like amount of it.

And so we are the alternative, right? For people that don't want to have chemicals and especially where people with sensitive skin, hydroquinone is a bleaching agent, right? It bleaches your skin and it can actually, for people that have darker skin tones, they can actually make your hyperpigmentation worse.

And so we specifically offer our products and target people that don't want, especially on their delicate areas, their intimate areas or their underarms, that don't wanna put chemicals. I mean, there's another brand called Native, that does underarm deodorant. That's an aluminum free brand. And so it is becoming a lot more widespread that people don't want to be putting aluminum and mercury and hydroquinone on their body. These are all known toxins.

And the ingredients in this, because this is something that I get asked all the time, like, does it work right? And I say, you know, the ingredients that are in this are scientifically proven ingredients to, to reduce the melanin overproduction. And so you can talk to a dermatologist about these ingredients.

And so they're kojic acid, right? Which comes from mushrooms. It's alfalfa that comes from mulberry root. So these are plant based extracts, but they are proven to, to help even out skin tone. And so, and there's studies that show that they're just as effective as hydroquinone. And so that's, what's really nice is that you don't have to use the toxins.

You can actually, we like to say we have clinical strength products with natural ingredients and all the results and none of the toxins, right. All the results and none of the, none of the, the harsh chemicals. And so what's nice about these products is that you do get the results and you don't have to compromise on, on your skin.

[00:22:00] Ronald Skelton: There's a lot of people on the planet that have jobs, where that's important. Where the changing of coloration of that type of stuff is important. A lot of stuff in the adult industry and, OnlyFans in the, ho-, home adult industry. I don't even know if I've, I've never been on OnlyFans

I don't know if they run, run ads or anything, but, I'm wondering if there's a, you know, is that an industry that, if anybody's over 25 in that industry, they're starting to see some things that is going to impact them being able to produce income. And I'm not trying to make it right, wrong, good or bad.

People do what they have to do.

[00:22:32] Morli Desai: Yeah. And let me normalize it because it's not, it's not for, for just those people. Right. So, so growing up, right, I had really bad acne and I would get breakouts on my back. And so, and they would always live, leave hyperpigmentation. And then I also,just from having a darker skin tone I just have darker armpits, right? 

It's not the hair. And even though I would shave really, really close, I would still have some hyperpigmentation and I never wore sleeveless shirts because I was embarrassed to raise my arm because it looked like I had hairy armpits. And then when I got pregnant, I got this like, line down the middle of my belly.

There's a, an actual name that I should learn it. I call it like the pregnancy post baby belly line, right, that didn't go away. Similarly, my areolas got dark and got dark. My, my elbows, my underarms, and even my intimate areas. And also, when I wasn't putting myself first, I weighed, 50 pounds heavier and my thighs used to rub against each other.

And that friction was causing the hyperpigmentation in my thighs. And then even when you wear a bathing suit, right, you see your thighs. You also have the ingrown hairs from trying to shave or wax in your intimate areas. And so that, it's for women that have that, right. And that's a lot of us, right.

That's not just people that are in the, the entertainment industry and it can cause major confidence issues. And I'm, like I said, I never wore sleeveless shirts or tank tops because of my back acne. And then I also get breakouts on my arms. And so this product has helped me get my confidence back.

And this is what I aspire to do for other, for other women. And a quarter of our customers are men. So it's not just that men that suffer from body acne, from breakouts or, manscaping also causes the ingrowns and the razor burn and the friction.

[00:24:38] Ronald Skelton: My 13 year old son actually has hyper pigment spots all over his arms because, we went fishing, uh, it was only like three or four different times. We went out where he got ate up pretty bad by mosquitoes and he scratched them all. And, I'm part Native American. So we,we get tan pretty easily.

I don't know if that, I'm inside all the time. I'm the whitest guy in my family. If you've seen any of our other family members, they look more Native American than I do. But,what he, what's happened is now he has almost those like freckles on his arm anywhere he had those scars. So, it's one of those, I kept telling you got to quit scratching those.

Those aren't going to go away. There's going to be there for a long time. And he starts, he's like, Oh, it doesn't affect his video gaming, he doesn't care. But, at 14, 15, when the hormones really kick in and he starts like, wanting to talk to girls, it's, going to say he's going to start being more self aware. So yeah, I could see where guys would want some of this stuff too, because the scar tissue isn't a textural thing anymore on, where those were. It's just a color change.

He's got a lot of darker spots.

[00:25:34] Morli Desai: That's exactly it. It's just through the healing process, the body just overproduces melanin. It's, melanin is, is beautiful. It protects our skin. And for people that have more melanin in their skin, right, we get more of those dark spots, but everyone has it. And, you know, and 40 percent of my customers are Caucasian.

And so it's not just for people of color. Like we all,we all can suffer from hyperpigmentation. And so for some of us, it, it's a confidence killer.

[00:26:02] Ronald Skelton: Interesting. What is your current plan for,you said this is kind of a turnaround. What is the plan here? What does that look like? First of all, let's just kind of go into this. When did it hit you, you're in this spot? When did it hit you that you've acquired something that you've got personal, I'm thinking you did an SBA loan?

[00:26:20] Morli Desai: Yes.

[00:26:21] Ronald Skelton: So now you've got personal guarantees. I think you mentioned that before the show, but so you got personal guarantees, everything's kind of on the line now. You have kids to feed. If, as a business owner, if you're not profitable, it's hard to pay yourself. You got to pay employees and buy equipment and stock and stuff, you know, or, or, inventory first. 

All that happens a lot of people don't get that. If you're an entrepreneur, all that happens before the entrepreneur gets paid, right? Cause if we don't do that, you may pay yourself once, but you're not going to pay yourself two or three times because it's going to be gone. So, when did it hit you that was like, okay,now we're, because sometimes it takes a while to set in. It takes a while before you'll like acknowledge that man, this Google thing just went sideways on us.

How long were, how long into that cycle of this isn't working? Do you guys pick it up pretty quickly or?

[00:27:06] Morli Desai: Yeah, no, it's interesting, right? Cause everything now is like a debrief to be like, how did we get to this point? So I went under contract mid 22.You know, in that June, July and so I had numbers through May. And you're right. We did, use an SBA loan and the SBA, the bank took a while. And so we actually didn't close till closer to the end of the year.

And then, and I would get every month I'd get the updated financials and I was starting to see it. And I would reach out to the broker and I'd say, gosh, like the cashflow seems to be decreasing, but they always had an answer like, Oh, the cyclicality. Or, Oh, we had to like, prepaid this expense on Google or like, and I wasn't in the business and I was only still just getting the information like second hand, right, through the broker. 

And then when I got into the business really was in the beginning of 23, and that's when I started to see, like the Google return was starting to drift, right? And so every month I would be like, okay, is this really drifting? Like, maybe it's going to come back because we haven't hit the summer season yet.

So halfway through 23, I was like, wait a minute, something is definitely going on. And I had brought over the marketing lead that was leading all the Google ads. And so I ended up replacing her midway. Thinking that, okay, well, maybe she just took her eye off the ball, or she's just not the right resource. And brought in another resource to kind of, you know, and just say, Hey, like the Google ads, like the returns are starting to, it's starting to go down.

And so I brought them in and was like, look, I need you to get this return. And so, and the new person was like, okay, that's what we need to do. And the only way to continue to get that return was by like, pulling back the spend and really like looking at each and every campaign and shutting off stuff that wasn't getting it. 

But as that was happening, right, the spend was like going in and in and in. And while we were making technically, we're making, she was making the row as targets.

Pulling back the spend was making the top line come down. And so, we let, I let that go another six months. Again, this is my first time running an e commerce business.

And so,it was taking a couple of months to really understand. And then at the end of the year, I was like, wait a minute, like this isn't working. Brought in another e commerce, Google ads expert and was like, look, I need to scale this back up. We've got to do it. And so we restructured all of the accounts and like, did our best shot.

We, you know, it was a, we took a pretty big hit. Cause you gotta let the algorithm relearn everything. And it worked for a little bit like the new person, but then a month or two later, it started to see the decline again. And that's when I started attending e commerce, e commerce conferences, going on the forums, like everything and be, and just trying to get as much help and realizing that the playbook today is you've got to be on Meta. And the Google ads, it's just, it's getting more expensive.

And that's when the pieces started to come together of like the cost per clicks and everything. And, and my Google ads, people were doing everything they could. But I was holding them to a certain return and when the cost per clicks go up, right? It's just that's out of their control. And so, we're 18 months in and that's why we're at this point now.

We're like, okay, we've got, three to six months where we're going to really focus on Meta and really try to get it going again. And then we've got to focus on new marketing channels because we can't continue to be reliant on one multi billion dollar company. That's a black box, right?

You gotta, we gotta have multiple multi billion dollar companies that we're giving our money to.

[00:31:02] Ronald Skelton: Right, right. So, speaking of that multi, multiple, multi million dollar companies you're giving money to, on the Amazon front, the one reason I hate Amazon so much is when you sell something to Amazon, they own the customer. When you sell something on any, almost any other platform, even if you're using Shopify or your own shopping basket system or something else, you usually can get their name and email address, right?

And now you have it owned, ownership of it. Do you guys, what modalities do you currently use for advertising? I know you already told like the Amazon ads and stuff. But do you do video? Do you do newsletters? Do you have other stuff going on?

[00:31:39] Morli Desai: Yeah. So one of the big investments I've made is an email because on the DTC side, I own all those customers and we have a very healthy email list. And,one of the things that I realized when I was first looking at the company was that the reorder rate wasn't that great. And I think it's because, people need to be reminded.

They need to be kind of urged because it's a natural product. It works at the lower levels of the skin. So you've got to be consistent with using it and exfoliate to then have the skin, the skin turnover and have the more even skin tone appear. And people gotta be reminded, like someone told me,people are only 50% compliant on prescription heart medication like Lipitor. Like imagine skincare, right?

And so we have invested heavily in email because, and I've already acquired those customers, so I don't have to keep acquiring them, right. And yeah, and we've been able to increase the repeat customer rate. triple, we triple it. Yeah. Now it's about 20%.

[00:32:41] Ronald Skelton: One of the ideas I would do, if I was in your shoes, I would create a little, a simple, probably you can have anybody on Fiverr write this out for you. But a simple thing that they put in the daily time they do their skin routines. And it puts it on their calendar. Like you just put in the times, it's like, okay, I do it, for me, I wake up super early. 

So I wake up between 4 30 and 5 AM. I have it on my calendar, but there's windows inside of there. If I were to do something like this, I would need something to go a simple tool that says I normally do a brush my teeth.

Maybe that's a good time. Right after I brushed my teeth to do my skin routine, if I was wanting to do it. I'd want something to go, put it in my calendar, just a recurring event. Skin reads, skin routine and in the description, step one, step two, step three. So that might be a way to, 

[00:33:25] Morli Desai: Yeah, but I do a weekly email to my customers and I do a lot about like habit stacking and like, you know, like put it right next to your toothbrush. And just whenever, right after you do it right before, but that's a good idea of actually putting it on people's calendars. Yeah. 

[00:33:40] Ronald Skelton: So a lot of, especially people who are in the professions and stuff where they have to be like, executives or stuff like that. Where they have to, we're just kind of, we're trained into, you know, I don't set an alarm to wake up and I don't set an alarm to go to bed, but everything's on my calendars. 

But, uh, just thinking of things. Now, the other one I would ask you, do you play in the realm yet of the micro influencers? So not the big influencers have a million followers because they would be really expensive for a small company to play with.

But there are guys, guys and girls out there that are, doing stuff in your, they're naturalists. They're talking about vegan menus and they're talking about other stuff. I'd almost have your marketing guy, somebody on your team, even a, a VA, like, Hey, crawl through all the,the influencers out there.

I want them to talk about any, anybody's talking about anything natural, right? Anybody that's in the, fits our persona that's in this age range or this age, or, the two personas you have. If they fit this realm, and they've got more than say 2000 followers, earmark them and let's pick four or five of them and reach out to them.

So I just thinking of ideas, as far as, and some of those are pretty low cost, right?

You could do, even almost do affiliate type of stuff where you give them an affiliate code and anything they sell they get a percentage of. That type of stuff. 

[00:34:52] Morli Desai: And we are doing that a VA on my team. That's exactly what we're doing. We're reaching out or watching, Instagram and TikTok and reaching out and trying to find good collaborators. So, yeah, I mean, it's, it's a niche product, right? So we've got to find the right person. And so it does take a lot of outreach.

[00:35:12] Ronald Skelton: It does. And it's a, it's a numbers game, right? You're going to reach out to a thousand people and 50 of them are going to be interested and you're going to talk to those 50. And only three of them are going to have the right cultural fit, the right personality some integrity. All the different things you're going to want like to represent your brand because once they, like once you say it's okay for them to be talking about your stuff.

Anybody can take a picture of, I can hold up something go, my wife orders this type of, you know, oils or whatever. There's just so many different realms inside of this. I was curious, do you have anybody in house that are doing their own modality? Meaning their own video and their own application videos and that type of stuff? Do you have kind of a, or is that you? Or I mean, is anybody there putting video content out?

[00:35:57] Morli Desai: Right now it's me. And again with like the turnaround, we're trying to do things as quickly and as cost effectively as possible. And so, yeah, it's me putting myself on camera and telling my story and doing things like this where I can leverage some of the content, but yeah. But that's one thing that I've learned is that, DTC brand is all about content.

And it's about, being authentic and connecting with our customers. And so I feel like I can do that the best, especially cause like my main persona is me. So a lot of it is me putting myself out there. 

[00:36:32] Ronald Skelton: And it should be. You're an attractive, I'm, I'm, I'm a happily married man. I don't mean anything, but you're an attractive young lady. And, uh, I have, if I was, if you were out there trying to find a, a spokesperson, you'd almost be marrying yourself anyway, right? Like, you're your own persona. 

But that said everybody, every CEO out there, if you fit the number one persona and you're having trouble rolling up your sleeves and being the spokesperson, is incredible.

Because you have a passion for it, you have a heart on it and people can connect to your story. How often are you guys putting out content? Are you doing this regularly?

[00:37:04] Morli Desai: Yeah. And this is new, right? Like, this is me learning how to do this. Which is so out of my comfort zone. We've got our organic presence on Instagram and Facebook and I've got someone who's posting a couple of times a week. But the goal is, is to start doing it a lot more regularly and yeah, and that's a lot for me. Like I'm not one, I actually don't do a lot of personal like Instagram and Facebook.

I, you know, it just doesn't add anything to my life. And it's ironic that I'm in a business now that like requires me to put myself out there. And Ron, this is a part of it. Like getting on podcast was like the first step in getting comfortable in, in putting myself out there and telling my story.

Because if I don't, no one's going to learn about the products and the brand and what amazing things it can do for them.

[00:37:56] Ronald Skelton: Okay. So let's go into some other ideas here in the, real quick. Have you thought about making a second acquisition? Cause one of the ways to pull yourself out is you add a product line that has a higher profit margin, that's an upsell complimentary. Not that you would tackle the multi billion dollar, probably bare mineral, minerals company, but something else that they've got a viral effect. 

People are using it as starting to take off and that using their product might induce using yours too. Is there a product out there that if somebody buys yours, they're probably going to buy that, you know. I'm at the stage right now we just bought this stuff off a TikTok shop for whitening teeth, right. 

My wife and I thought, well, that's really looking really cool. We're going to try that blue toothpaste that turns your purple t shirt, toothpaste, you know. If somebody is buying something like that, probably chances are you're at the age where you're starting to worry about discoloration of teeth.

You probably have discoloration of skin too. So I don't, I'm just thinking outside of the box. I've interviewed and talked to a couple of people who have managed to acquire themselves out of your situation. They bought or did a, and now that you own a company, it's not an SBA loan either.

You can do things like, I kind of, what's more of what we'd refer to as a merger. Like, look, I'll come in, I'll run yours. You're wanting to retire. I'll leave you with 30 percent of it. I'll take 70 percent of it. We grow it together. It becomes one company. And later on, I might buy you out for the rest, but you can do things now that you have assetsand a company that would be a little harder to do if it's your first purchase.

[00:39:25] Morli Desai: Hmm. You know, I'll be honest. I, I didn't even think about that. I've been so focused on trying to turn around this company. But, yeah, but you, yeah, you brought up a whole another like option that I haven't even thought about.

[00:39:38] Ronald Skelton: Well, we, we're at the hour we, when we burn through this hour really quick. I'm enjoying this. I want to respect your time. Before we go, I think we've got about 10 minutes or so still scheduled, about 12 minutes still scheduled on what we have on our calendar. But, I'm willing to go further into this if you are.

Tell me, what's your biggest challenge right this second? And if somebody is listening and they'd love to help you out, maybe they can send you some information or ideas to help overcome that challenge.

[00:40:07] Morli Desai: Yeah. You know, I mean, it's really about being focused on the turnaround. I feel confident that we've got a strategy and I've got the right people in place. And so it's more just about staying as level headed and kind of you know, dispassion almost and executing on what needs to happen. And then letting the numbers speak for themselves. Letting the business speak for itself and just taking it one day, one step at a time.

But yeah, but anyone that's been in a similar situation, I love to hear that because it's just, this is a first for me and it's scary with the personal guarantee on the loan. And luckily my lender has been very cooperative and is working with me. So like, that's been nice, but,it all kind of hinges on being able to turn around the company.

And so I'd love to kind of hear other people's experience being in this situation.

[00:40:59] Ronald Skelton: I have some contacts and friends of mine that are really, that's what they do. They buy companies to turn around, but I'll reach out to them and see what they think. And maybe one of them will, will, offer up, uh, some time and do it like, maybe,a half hour, an hour of brainstorming or something, but I'll reach out to my network too.

And, uh, so, somebody is listening to this show right now and they're in this space you're in, what would be your advice to them? What would, what would you want to say to those people?

[00:41:27] Morli Desai: Yeah, I just, I don't regret anything. Granted, I don't love that I acquired a company that's not performing where it was, or, matching the vision of what I thought I'd be doing, you know, almost two years in. But it has allowed me to fulfill a dream of mine and it's allowed me to live a very values based life. 

Especially as a single mom and have the flexibility I need to make sure that I'm putting myself first, you know, the kids second, and then my mission, which is my business, third. And so it's all a part of the journey and wherever it ends up, at least I feel like I am living a true value based life. And that, for that, I am grateful for.

[00:42:12] Ronald Skelton: Awesome. If somebody wants to reach out to you and, maybe have you on their show or, try out your product, maybe they heard something in here. We have a lot of listeners in your age demographics. If they want to try it out and stuff, what's the best way to get ahold of you and what's the best way for them to find your product?

[00:42:26] Morli Desai: Yeah, I'm active on LinkedIn. So, Morli Desai and Amaira Natural Skincare. I think you'll be able to find me pretty easily. And yeah, I, I always read all the posts and the messages that come in through there. So very easy to reach through LinkedIn. And then my company is Amaira Natural Skincare, A M A I R A, and our website is amairaskincare. com. And so, yeah, I would be happy to have people, especially if any of the things that I talked about resonate with you, check out the products and check out the company.

[00:43:03] Ronald Skelton: Awesome. Well, for being here today and hang out for a few seconds. We'll call that a show. 

[00:43:07] Morli Desai: Sounds good. Thank you.