From Pure Play to Omnichannel Challenger

Over the last few years, the digital revolution has completely transformed the way that we shop. The beauty industry has been one of the biggest beneficiaries of that. So for our first session that I'm delighted to work with Daniel Lang up, from Parfoon dreams, and he's meant to share a little bit about the story of how they grew into an omnichannel changsha. Why don't you grab a seat with me, Daniel? For sure. I'll see if the area are perfect. And then hopefully, that's your picture. Great. Should I have to dodge away or it's okay for you guys? No. We know who you are now. It's great. Daniel, you were one of the founding members of perfume drinks. Can you start just by telling us a little bit about your role and the journey that the business has taken? Yeah for sure. So kind kind of founding partner a founding colleague. In the end, I have to jump back to meanwhile studying. I had a good friend of mine. It was Kaitenschen and Kaitenschen was the former founder and, yeah, some of the owner family from Public Center, and we had a couple of enterprises found it together. I mean, well studying and yeah, all of them are not there anymore. So at least we know how to how to not do it. And the last one was more of as perfume dreams, which he that he recently bought back in the the webshop. And we played around. It was around twelve two thousand seven, two thousand at two thousand seven, I guess. And then after finishing my studies in two thousand nine, I had the idea of officially joining the enterprise and Yes. Since then, I'm there and I'm not gone, and I don't have any plans to to do so in the future. And yes, since then, I'm there and In the beginning, we started like, yeah, developing the whole web shop, doing customer support, and all the stuff by our own, then kind of normal, let's say normal startup story, you you're growing, you have to to do some adoption, some changes, you get more and more into details, processes, and all that stuff, and around, I think it was two thousand eighteen. We had the M and A going on with doulas and Right now I'm still there even if I unfortunately didn't have shares back in the days which was kind of a pity when the merger kicked in. But yeah, I'm like I said, I'm still there and happy happy to be there and don't plan to leave. Wonderful. Thank you so much, Daniel. When parking dreams first started it. It took quite a novel approach to things like customer service with, I would say, very competitive returns policies. You fermented with using WhatsApp, for example, to deliver customer service. How has that evolved over the last few years? Yeah. I would say in the beginning it wasn't about like being the the tech marketing leader or whatsoever. So in the beginning it was more or less like being in the first grade of class so run it through it and have have fun doing the stuff and seeing the development and for sure in the beginning we saw our now our company Mother Duclas as our main competitor because there weren't so many other players at least in our branch and we try to tackle them and we try to compete with them and for sure we played around and tested a lot of new features, but we really felt like okay we are we are faster because we are small and don't have to rely on so many like I said legal difficulties or whatsoever. So we never checked something that detailed that a normal corporate is doing. And then to be honest, Flakuni came came in the game and they literally changed our way of work because they were then the father moving competitor. And so we said, okay, we have to do something against it and so there came like ideas of how to implement WhatsApp service and I think we were one of first at least in our branch in Germany or in Western Europe. We were the first one using this in the beginning, you still could use it as a marketing tool as well. Then later on, Mitov didn't allow to do marketing activities anymore while WhatsApp and same was like I guess it was even Flakuni treated us to do it that way. So they expanded their return delivery days to ninety, and there was like kind of okay, if they're doing ninety days, we will do one hundred and eighty. Let's wait and see. It was literally like fighting against each other and the positive thing is the the whole fight was maybe some from some perspective to the disadvantages of us as the the retailers but all the time in a positive direction of the customers in the end so it was It was literally very often our competitors who are forcing us to be innovative and all the stuff. But back in the days, we really felt quite comfortable being the one who's trying to implement the newest thing. Right now I would say we are not earlier us anymore, and we are at first nervous anymore, but we are still early adopters kind of. Yeah. That's that's very honest with Scott. Thank you so much, Shayanid. It's it's nice to hear that that healthy competition has actually kept a level of innovation at industry level as well. And I just wanna stay with that idea of agility that you mentioned at the beginning of your response because obviously the pandemic has had a huge in on your category. I mean, the beauty category has remained incredibly resilient and there were new behaviors and new routines that customers and consumers adopted. Have you seen some of those trends and new ways of reaching the consumer remain following following the pandemic and and the relaxation of lockdown. Somehow, yes. In the end, When I compare the way of work we are doing right now with the time of the beginning of the pandemic and even before, we always were very good and very keen of getting new customers in our shop, so all this paid traffic and all that stuff was something we all the time did more or less. And then for sure COVID kicked in. And this thing completely changed in twenty twenty two somehow, at least in the later months of twenty twenty two and I guess all you guys heard about it or read about it somewhere, that plenty of enterprises change their way of how to spend money and try to save money and pay more or have a more detailed look on margin and contribution and all that stuff and less on the only ad spend in net sales. And yeah, so we did as well some in some ways, but we are still thinking about, okay, how to get in customers in our in our shop so this part, this paid channel never changed really, but we are focusing a lot more nowadays on, yeah, customer loyalty, on COVs, on how to get the CRM. Yeah. I would say it's kind of been operational excellence. So this is the way we are looking at right now. Back in the days, it was more about like, okay, how could we thrill or bring the conversion rate up two x y z percent even on the first contact. And now it's more or less like, okay, how could we keep the customer for a longer time being around with us and keep them all So this is the, I would say, the major change we add, and we think it's common for a lot of other enterprises as well. Thanks so much. And Obviously, now you're expanding into more touch points with both physical and digital touch touch points available to the consumer. But I'm curious because category itself of beauty and fragrances is a tangible category, it's a sensory category. How do you create a marketing and customer experience to get the customer so engaged with the category that you would normally have to touch and smell and order to appreciate it. Yeah. So we would have the perfect solution. I would think I would create a consultant agency for that but in the end, on the one hand, it's a really cool category because we are the perfect replenishment case. In the moment you know which fragrance you are rooted for or which makeup fits perfectly your needs, you have to buy it somewhere. And if we make it easy for you guys to to purchase it online within two, four, five clicks and get it on the next day. It's a piece of cake to do so and we are all Yeah. It's it doesn't take a lot of effort to to to get to this point. But and this is the main challenge how to get new products or new innovations, new ideas, and also a lot of content really contact with a with added value to the customer to to keep them in the web shop so to not only be the replenishment case. And this is the most difficult thing and we are really looking forward and like I said in beginning we are not the first mover anymore but signed the WWEDC stuff with the the Apple glasses going on and think about our VR AR and how to implement it in the app and in the web shop could be something which will bring us even closer to the customer and to the journey the experience with virtual try on which already exists and stuff like that but yeah the the the major thing we are working on is to bring the product which is in our opinion or database driven idea which is missing for the customer in the perfect moment to the customer, not while offering him the product with him with a price off, but telling me like, hey, this is your journey. You normally need these five products to to to add on or to to mix them. So like you take your zero, you take your night, night cream, day cream, whatever and this particular part is still missing. We have it we can supply it with and then your your complete routine is perfect and all set, and we are here to help you. So we are reaching out helping the cool and the cool the cool adviser from above the corner and we are not the one trying to sell it to you, but we can definitely help you if you have any other questions. And this is more or less the the way we develop or we see ourself developing away from just been the replenishment case, just been there with good prices and that's it in one direction of okay. What else could we offer you? What else could we do to make you feel comfortable to make you feel happy? So that relationship building and client telling is a very important element then. And you touched preemptively on a couple of tools that you're starting to moment with things like AR REITEC. What other technology tools are helping you to fuel the rapid expansion of perfume dreams now? In Moses. Full stop. Shame stop. For sure we are experimenting around with the the the open AI or PTE for sure as well on our side and yeah having like all this augmented reality stuff going on like for three or four years back in the days we we experimented around and nowadays we really see yet data is not in you as well, data is the new goal to somehow and you have to to be not only the the owner of your data but you have to you have to a perfect processor of it and you have to gain valuable insights out of them and so therefore you need a big data warehouse combined with a good marketing solution in marketing engine and this is where a Mars really kicks in so that you can really play around or combine all the different channels, all different touch points at the right time. And yeah, despite all this new fancy stuff out there and there are plenty of tools with deep skin analysis with wire and algorithms and stuff like that, you have to have like a tool which perfectly combines a situation of the different challenge channels, and this is where MRC's literally helping us in all the time. Nice. And I mean obviously that's quite being quite a strong partnership for you. And it sounds like as the business has grown, collaboration has played a really important role in strengthening business as well. Can you just dive a little bit into some of those partnerships and other collaborations that have helped of your growth? Yeah. So in the end there are like couple of partnerships which where we stand out, I would say, on the one hand for sure, it's our industrial partners where we are partnering with. So speaking about the Lorriels, the Elvira Machets, and the chanels of this world where you have like long term partnerships for sure since we need to get the products on the one hand. But yeah, you can deep dive with them and thinking or building think tanks about okay, what what could be the next products or what be the next technical implementation from their side as well. Twelve years ago, we spoke about iframe implementation of product finders and whatsoever. This is the one part of the of the story and the other part is for sure tech related partnerships like don't know, don't want to do name dropping here, but you need someone doing perfect retail media stuff on-site or you have to do you have to find someone was really good in helping you optimizing retargeting campaigns, then here for sure you have to partner somehow with Meta and the other big ones can discuss about how if it's really a partnership on eye to eye basis, I wouldn't think so since they are too big and we are too small. But yeah, also in the end if you ask me for which is the the most crucial partner and I'm just I'm doing tech and marketing but Now I'm speaking only from marketing perspective. If you ask me who's the most valuable partner for me to get the marketing flywheel, yeah, keeping on. Once again will be a Mars distance. They are doing SMS implementation, push loads, on-site pushes, email, print mailing, automations, everything. And it's more or less aggregated all in one. For sure, then they are like you have behind behind all your initial marketing fitties. You need partners for post purchase communication to your to your customer. You need someone for having like getting net promoter scores to know what's to to not only receive the negativity, why customer support when something doesn't work, but to own to also understand how how how happy, how satisfied are your customers And yeah, in the end it's just a number but you can start to interpret these number numbers. But yeah, like I said in the beginning, we are now working Philip, maybe you can help me, but I think it's like twelve years, ten years, something around that with the Mars, and we try to do it with the degree every partner we have because Maybe I'm not willing to change anymore with at the age of thirty eight, I don't know, but I but I like having long term partnerships because it makes it a lot easier to to discuss really openly even their negative issues with each other. And also something's working well, you don't need to fix it. Right? You you mentioned using data and feedback to kind of quickly understand any kind of problems or opportunities that you have. And apart from dreams has expanded its territories internationally recently. So as you've been doing that, have you encountered any challenges as you've been entering new markets? How have you had to localize your strategy to ensure that you're you're relevant to new consumers? More than just a couple of months here in the end. It's it's already a couple of years ago when we started doing international pentagonization. I think we started around two thousand eleven or two thousand twelve with getting the web you translate it to English and then roll it out step by step in other countries and nowadays we are working or we are active in sixteen countries. This was even before heaven, the M and A going on with Douglas. And we had this. So we are from down south Germany, we are from we are from nearby Stuttgart and the Schwab have this idea of doing everything by their own. We are never buying anything. We are tried to prevent it from scratch new why so for whatsoever reason and we did this exactly with our internationalization. So we thought, okay, it might be a good idea to have our own back end system, our own fulfillment and shipping system. So we create we create literally everything from scratch. It was a cool idea. And then we also thought it might could be a cool idea to just take the the really necessary things like the terms and conditions and like know you impressed impressive impressive. I don't imprint imprint. Thanks. Your imprint and translate only this for example in czech language and then roll out the shop So there was still water perfume, water toilette and shower gel in it, and then we started like it was kind of bootstrap. So you started with a really tiny portion of frustration, having no localization, having no payment methods which are necessary in particular countries and then it was like doing it step by step. And if you ask me what I would do else nowadays, I would definitely take more money in the first step to having a way better way more proper set up in a specific country and then start with a big bang instead of doing this career like we we we stand there slow and nobody is aware of them. Maybe we start with doing some PLA and then let's wait and see how it works and if it develops then we can throw more money on it. So it is more or less we we did the opposite case from for example about you, which Tarik Mueller couple recently a couple of times already mentioned like doing everything they can and then entering a new country with a big bang thrown seven seven digit ad spend on it within the first week or stuff like that. We on one hand we never had the money. On the other hand, we never had yeah. We were never we were never we never felt that way. So we really said, okay let's keep it small, keep it close, we're we are like we are feeling like this little town Asterex Nobates surrounded by the by by the rest of the world, so Douglass and all the others and that's that was the way how we started working in a specific country, but this leads the direction that you are still focusing heavily on your home country because there you are doing the bigger numbers and it sometimes can lead to the situation that you more or less don't pay so much attention to new new rolled out companies like you should do. So this is more or less difficulty. I would change definitely today. Okay. Thank you so much. Again, a very honest answer about some of the challenges when you're trying to put that cultural resonance as well. What have been some of the biggest marketing highlights then for you? Every year, Black Friday with my team. Would say with the beginning of today, it's even single stage. So with the beginning of the tenth or eleventh of November, I normally I will I can do whatever I want. I will not get sick until the twenty fourth of December and then I can bet on money on it that I will get sick. It's every year, same stuff, but it's okay. And positive thing is my team's feeling kind of the same way and we are standing there back to back and walking through this crazy times with each other and if you're asking me for what is my one of my biggest things or the one of the things I can remember and I really, yeah, really like thinking back to these parts. It was the first time doing the McDonald's world a fully thing back in the days where we spread like I don't know thirty million vouchers and stuff like that. It was crazy for us and the second biggest thing was our first TV flight when we did television at spec in the day This was like seeing how all that stuff works, how you create a television ad, and all the stuff was This were like the from a marketing perspective, these two parts or these three parts are the biggest biggest things I I loved to think about or to to to remember. And yeah, for the good part or good part is Black Friday, Singles Day, explicitly. I can look forward to it for this year already. Once again. Amazing. Well some some awesome milestones that you've been able to map up. We're almost out of time but just sticking with that What's the next big milestone that you're looking forward to at Parfem dreams? Okay. If you ask me like that, I want to see and it's not a really big milestone, but we are struggling since one and a half years to get in TikTok or running. So my big muscle would to see, okay, when will comes the day where we are able to have like five hundred k of followers in the first videos with ten or twenty million of views. This is one part, but on a on a higher level, on a high perspective, I would say, There are some some other countries in Europe which we are not active yet, so this could be a bigger milestone to to work on.