15: Scaling Your Handmade Business for Long-Term Success

Hello and welcome to the Product Rocket Podcast hosted by Andrew George and Melissa Pickle. This is the podcast for creative product-based business owners who want to grow their businesses without overwhelm or massive investment. Each episode we explore actual strategies, real-life stories, and insights from business owners and experts who know what it takes to succeed. Whether you're just starting out or looking to scale, we're here to help you grow your business on your own terms. Subscribe and join us each week as we dive into practical advice and inspiring stories to fuel your growth journey. This is the Product Growth Lab. It is time to get started. Hello everyone. This is the 5th and final episode in our series on how to move beyond Etsy or Amazon or whatever you are and build a thriving handmade business on your own terms. So this series has been all about how do you get people off of these marketplaces with all of their changing policies and fees and stuff and get them over to your own website. And in this episode, we're going to be talking all about scaling. We kind of go on over the basics and this is how we scale up. Now that we have them over on our own site, how do we kind of scale up that strategy and make sure it works for us and brings us more money? Because we have a ton of potential at one site. So as always, I'm joined by Melissa.

Hi everybody!

And we have already gone over how to go beyond Etsy. We've talked about building your own site. We've talked about driving your own traffic. We've talked about setting up your email marketing. So we're going to scale up without adding the work, without adding the stress. And the main things we're going to talk about today are how to increase your average order value, how to get more repeat customers, how to automate and streamline so you're not doing everything manually, and when and how to expand your product line or revenue streams. So we'll start off by talking about increasing your average order value.

This is truly the number one thing that shifts your bottom line, is increasing your average order value. Which means if you have— take my personal experience, my average order value used to be $25. Every person who came at me and shopped, it spent around $25. And I worked over a course of a year, like part of it raising prices and things, but got me up to $40 as my average order value. And when I looked at the end of year totals, even having the same amount of shoppers, I made so much more money and so much more profit just by encouraging them to spend a little bit more. Did that through things like my— personally, I raised prices. I also offered bundle sets, which is kind of one of our big things that we're going to talk about here. Is like if they bought the bracelet, would you like matching earrings? Would you like a matching bracelet? Would you like a matching necklace? Do you want to get the full set, the full look? Oh, I sell bangle bracelets and this is a big in-person thing I do, but it's like you can get one for $15 or you can get two of them for $25. Now you need to get four of them for $50. All of that kind of stuff. It's kind of the biggest thing you can do without increasing the amount of traffic you have to really move your bottom line. Three big ways that we talk about on how to increase your average order value, or you'll probably hear all the time, AOV. And the first one is upsells and cross-sells. So that's like, you're buying this one thing, well, have you considered something else to go with it? So you can have a complementary product, a matching item. I talked about like, if you're getting the necklace, would you like the earrings? Would you like the bracelet? You can also look at cross-sells. So maybe it's thematic. I'm a jewelry example, so I'm going to talk jewelry here. It's like, oh, you like this Halloween-style necklace? Because I'm thinking Halloween-style stuff. Did you see this other Halloween-style necklace I also have? Maybe you want to get both. So upsells, things that go with it, cross-sells, other things that they might like. Really easy, and all it takes is just talking to your customers. The biggest thing about upsells, like if you look at the— we've all been upsold before. If you've ever been to a McDonald's and you've experienced the, would you like fries with that? That is an upsell.

It really increases the average order value. The thing with upsells and cross-sells is because they're There's a definition, and technically, like, both what you say is cross-sells. Upsells is actually, like, I double-checked on Google what they define it as, but upsell is actually where you get someone to buy the more expensive version of something. So if you're like, oh, here's the, I don't know, the value version, the $20 necklace, the economy version. Yeah. How do you get someone to buy the $100 version? And I know, like, all these terms can get muddled up and people talk about like upsells, media cross-sell, like it gets all confused. But if you have multiple versions of things in your store, push and peel apart, and I find that is so much easier on your own site. Like things like Etsy and Amazon don't really have ways of doing that. They have ways of getting you to buy someone else's upsell.

Yes, but very difficult to do your own. Let's just sneak out a trick. They're gonna actually read a description. Yeah.

And there are ways to do that, but that's not really what this series is about. But I was on Etsy yesterday, I just bought something and I was, while I was on there, I was like, you know what, maybe I'll buy, I'll see what the seller also sells. And they made that hard. You have to like go through and click and find their shop. Whereas like when I added it to cart, it was like, oh, here's other stuff you might want, but they were all from other sellers. And obviously for me, I don't want them showing other sellers stuff cuz they'll go with them instead. But also for me as a buyer, I hate that. I'm like, I don't want like to buy, well, not normally. I'm like, 'cause they'll all ship separately. They'll ship on other dates. I'll have to pay shipping. I want to go to the same person and they don't make that particularly easy. Whereas on your own site, it's so much easier. You can like take over their whole page with like, hey, here's the upsell, here's the cross-sell.

All right. We'll talk about the McDonald's computer things another day. All fast food joints are moving to, it's fascinating. It's the first way to increase your average order value. The next is bundles and gift sets. I'm at Aaron. The bundles and gift sets, instead of them just buying one piece, you put together a whole collection kind of thing for them to get. I know Andrew does bundles and gift sets all the time, right?

Yeah, and it never even started off as an intentional strategy. I had a shop, it sells gifts, it was just natural. I was like, of course I'll sell gift sets, but that makes a really big difference to your bottom line because people are buying more than one thing. Because my shop is primarily gift-focused, people are looking for the gift sets. They want something to make it easy, to make it a gift they can just hand over as is, pretty much, and they're willing to spend money in the process. And I found that, like, I've tested out things. Sometimes I give a discount for buying multiple things, sometimes I just put them in a gift set. And call it the gift set, and it's the same price as buying them individually. I've tried, what if they include like a free gift box, if I charge for the gift box, and it all— it— none of it really made a difference. People bought whatever I did. So I'm like, okay, we will do the full gift set at the, like, the full price for paying all three. And if I ever do gift boxes, which I ended up taking off because that— I had so much different size products, I had to keep stock of like So many different sized gift boxes, like it got too difficult and I was like, it's more hassle than it's worth. And sometimes I'll do it at Christmas, but like I would charge that as an extra because it works for me. But test that with your audience. It depends what you sell and who your customers are. But I'm like, people are willing to spend money. Like getting over that hurdle is a big thing as well.

That's a mental hurdle. One of the biggest things I think there with like people buying the gift set versus the individuals, they might want to put items together, but you've made it so they can get all of those items in that set in one click versus them having to hunt them down on your website. So that is just such a convenience for your customer by offering bundles and gift sets. Um, and the last thing we have here to increase your average order value, or your AOV, is to have a free shipping threshold. So not just free shipping on anything, but if you notice that people are spending $45 on your website and you want to try to bump that up, give them a free shipping amount at cutoff at $50. So if they spend $50, which is $5 more than they're already spending, they'll get free shipping. Most people, we all know that free shipping, it's not free. We know somebody's paying for it. But if you can get more for that same amount of money, like another product, it makes me very happy as a shopper.

Yeah. And it's because you might think, well, what if they just spend $5? Like, handmade sellers, it depends what you sell. So people sell cheap stuff, things like fudge jars, but for the most part like, for me, I think the cheapest they'd be spending is like, I don't know what they— I'm trying to think what's if they currently got— I think you probably spend like an extra 30, and like, I'd probably still do that. But trying to make that— like, that can be a decent bit. If you don't have anything that's $5, you're, you're really like quids in because you've got someone to send a decent amount more. And like, it's such a, it's a technique you can really tailor to your business. Like, look at your average order value, look at how much it costs you to ship something, and like, how much can I bump it up by when you get people to make larger orders? And that's another thing I hate about places like Etsy and Amazon is they kind of force you into the free shipping and you lose that trigger, like having that free shipping trigger again on average order value. So this is, this is why this is in this increase in your average order value on your own site section. We can talk about doing this on Etsy and Amazon. There are ways to do it, but this is what we're focusing on. And like, such a huge potential here.

Absolutely. But do it nicely. So I had a bad experience with free shipping threshold, and it was with the Vermont Country Store. They make a lipstick, or they sell a lipstick that I really like. And the lipstick's like, I forget, $20 or something like that. I only wanted to get 2, but then I go to checkout and their shipping price for lips was like $12.95. But I can't get— I checked Amazon, I couldn't get that lipstick, at least under that brand name, anywhere else. So I ended up buying 3 lipsticks and a gloss when originally I was only gonna buy 2, just so I could hit that free shipping. Because I'm gonna spend that extra $12.95, goddamn it, I'm gonna get something for it, not just ship it.

It's for you, but they're, they're like, they had a great experience.

It did, it did, it did work. Yeah. Yeah. And now I need more lipstick. I finally ran out of that. Kind of like, goddammit. Can I drive there for not 12, not for $12.95, 2 hours away. Anyway. Okay. So that's increasing your average order value. Our next way to kind of get more money here is to— is by increasing or getting more repeat customers. So most businesses that we're in, hopefully you don't sell a one-off, one-time-only product. Hopefully you sell things that are either consumable, meaning like soaps, candles, candy, anything that they use up and then buy more of, or Kind of like Andrew's, in my case, a little bit more. They're collectible. So maybe it's one of a series that they're going to buy more and more. You're going to come back if I have a gift experience for you. You love the jewelry, you're going to come back and you're going to buy more of my next designs. Kind of similar with Andrew, right? Good gifting experience, you're going to come back.

Yeah, it's like, I need a gift, oh, I'll go back to Andrew. Like, when I started out, one of the things I got, because I had one collection to start with, I kept getting reviews and I was like, I want to buy more gifts, but you don't sell anything else. People wanted me to make more products, which is a great position to be in. And I think there's ways for most businesses to encourage repeat customers. If you're like something like a, a wedding planner, you probably get some repeat business, but you don't expect a ton of repeat business. But I think like there's probably, if you're in that, actually there's probably smart ways to keep selling to people. But I think for most of us, it is that collectible consumable kind of thing, and people can come back. And depending on what you sell, sometimes that can be really easy. Like if you're selling consumable, all that like subscribe and save kind of stuff makes that super simple. Yeah. And if you're more of the collectible side, it is more in the follow-up and the emails and stuff. And we'll talk a little bit about that.

And the collection launches, like people are always looking for what's the new thing that you offer. It's one of the most powerful words that we have in marketing with products is what's the new thing. Just, I have a new color.

Yeah. And there's smart ways to do collection launches without having to create new products. There's one with that. I don't know which one on the podcast. Maybe it's an episode.

You are a master at that, Andrew George.

Yeah. My Christmas collection never changes, but it sells out every year. So this year I think that like the supplies I normally buy are discontinued. I've been doing it for so long. So there might actually be some change.

You might have to do something new.

Yeah, but I didn't, I haven't had to, and I like, sometimes I'll throw in a new thing every so often, but like, it's, there's smart ways to do that. I think we'll have to do a whole episode on that in the future. But your repeat customers are cute. They, they spend more money and they cost less to market to. Sometimes, like, it's like the lipstick thing, and then you're like, well, I'll need to try it, like, the first time, like, okay, I'll try it. I'm not gonna buy 5 to get free 7 because I'm like, this could be awful. But I mean, you're like, okay, I want the free shipping and I bought this for it and it's the best.

I'm gonna buy it. On me, I love it.

So even in the, 'cause, well, that's consumable. If you sell those kind of things and it's like you've done a collection launch and it's like, okay, my favorite scent, my favorite color, my favorite shade, whatever is, is being discontinued. And that's like, okay, I'm gonna buy 10 because I need, yep, I need this. I can't let go.

100%. Focus Focus eyeshadow palette. I have how many?

But like on that first time we were more cautious, like this, this could be awful. This could be a total scam. You're probably not gonna spend as much, but once it's like, okay, I know this stuff is good, that you're gonna spend more. And I haven't had to spend a bunch on ads to get them that first time. I've already got them and I'm probably marketing to them in my email inbox. Where it's costing me cents to market to them. And also, there's a—

I figure if you get one person to buy from you twice a year, so say your average cart is $40 or whatnot, and you either did the work of social media or paid advertising to get them in and they bought from you once, and then maybe 6 months down the line they buy from you again because now holiday season, you didn't have to pay to get that person back shopping with you. He just had to do follow-up. If you can get them to buy from you 4 times a year— I have a lot of people who shop with me quarterly, usually on the big collection launches. They come, they're paying attention, and they're buying that time. That's someone you didn't have to pay for. They're already a fan, and sometimes they bring other friends with them. Or you can have crazy insane loyalty and have people who shop with you fully or weekly.

And it totally depends on your business, what you do, how you do that. Sometimes you might think, okay, Like someone will only buy from me once a week. Like I'm getting, there's people who buy from me every Christmas time, but if I do the right follow-up and get in front of them, they probably buy for someone's birthday. Sometimes you do something, it's like, okay, I'm gonna treat myself. Like no one bought this for my birthday, I'm gonna buy it for myself. And I target them. Mm-hmm. Because I can, like, it makes a bunch of sense for a lot of businesses, especially like me, Melissa, to collect their birthdays and do some, mm-hmm. Like email, and it also does direct mail kind of stuff.

I have one that came back because the goddamn address is wrong, but there's a birthday club card. That's a fail one.

There's a bunch of extra ways to encourage that loyalty throughout the year. And again, we've spoken, it's mainly email is how we talk about doing that. And direct mail is kind of just a printed out version of email. That's an oversimplification, but mail, just a real or a virtual inbox. And there's a bunch of ways in your physical mail, real mail, SMS, WhatsApp, whatever you're doing to set— to keep up with your people, to do that. Giving them things like that exclusive action— exclusive action, exclusive access to a new collection. If you're like, okay, Melissa's new jewelry designs sell out on day one, they get 24 to 48 hours early access.

Before it goes public.

Yeah, giving them that early access, like, I know this is going to sell out and I know I want this, so I have that— giving them that early access, you feel VIP. And there's also a bunch of the agency, it's like, okay, if I don't buy this today, it's gonna sell out and my life will be over. Like, people get a bit crazy when it comes to this stuff, but like, I'm sure we've all experienced it where it's like, I have to buy this thing. Entirely illogical, entirely stupid, I have to buy this.

We're human.

Doing the personalized kind of post-purchase stuff. I talk about this a ton. I have a bunch of products on this, like, this is my job. All that emails, we spoke about birthday offers, talking about your product, talking at the right time, putting them in kind of personalized follow-ups depending on actions they take. Like, there's a million ways to do this that I can't fit into like a 5-minute segment of a podcast, but I'm making sure your email is built to encourage repeat purchases, all your segmentations, flows, and all that stuff. Like, there's a whole bunch of ways to do that. And there's also the little touch, also the law. If you want more repeat customers, you need to give them a great experience when they buy. Having like nice packaging, the handwritten note for someone, making them feel welcome. You can do that in email as well. Like, sometimes you can do And there's ways to kind of fake it in a not disingenuous kind of way where it feels like a personalized follow-up. It feels like a one-on-one email more than a marketing email, and it feels a little bit more like a little bit more of an effort someone's put into you, like doing everything you can to make that purchase experience— the, the follow-up emails they get when they get And when they make an order, those are the ways you might not think about paying fees. Customer loyalty, you kind of think about what happens after the purchase, but the purchase itself is such a big thing. Everything you do goes into it. Like the design of your site, like was it easy enough for them to purchase or did, was it a nightmare to do? Like if it's, did I have to dig through your site and it was slow, like I ended up purchasing because I needed like But if it was like slow to load, every time I pushed something, there was like a popup with 18 different upsells. And I went to your site, it asked a bunch of questions and I had to give my phone number. I didn't want to get like, there's a bunch of that stuff. It's like, okay, maybe I purchased and I don't want to purchase again. Like making it a really nice smooth experience for people is one of those things that really goes into kind of making it more fun and enjoyable, and that's what makes them want to come back.

Right. Next up is automating and streamlining so you can save time. Biggest issue in handmade businesses, we do everything by hand or manually. So looking at ways, Andrew's already talked about a bunch of them right here, that you can streamline, it's going to make you not necessarily more money on the front end, perhaps, but it's going to be more efficient. You're not spending as much on the back end, and that can have a huge jump in profitability here for you. So the first things that you can look at automating, we have kind of 3 of them here for you, but your email marketing automations. Andrew was talking about post-purchase series. We've talked about welcome series ad nauseam on this channel. Engagement techniques, having those things on autopilot. Uh, so someone comes, they sign up for a list, the welcome emails, they're already— they're going. They make a purchase, you don't have to think about it. The post-purchase series is going, it's activated, it's running. That can be bringing more money in on the front end, or it's just, it's stuff you don't have to worry about. These are kind of a little bit of set it and forget it kind of action. Also, order fulfillment system. So if you have products that you can batch manufacturing on, that's fantastic. I know when we get to the holiday seasons, Halloween especially for me, I will make like 30 of a product and then the orders come in, I'm just pulling that product. I'm not making it as it comes in. Note, this is jewelry. It's not pre-sized stuff. Pre-sized stuff I always make on order. Uh, but you can prepackage like—

My stuff is all personalized, but I still find ways to batch it. Those really busy times, days like Black Friday, I will make several of the same item in one go because it's much easier to— like, even though they're all personalized and different, having everything like hooped up and ready to go on the embroidery machine— if you don't know why I do this, but it's much easier to swap and do the same thing like 10 times instead of having to— like, you have to set my desk in a certain way to do certain things. I need to have like different things I use to find the center because I want things to be the center. Sometimes I have to go in that side and like 2 inches up and 3 inches over. Like, there's a bunch of— it takes a bunch of time to kind of swap between doing different types of things. Whereas if I can be like, okay, I know I have, uh, scarves always sell really well on Black Friday, and they are really fast to make. And it's like, okay, I can have them all hooped up, I can get really good at it, because there's a lot of like finding the right place. I kind of get— if you do it in a row, it kind of gets something better and faster doing it. And I just do them one after another and then it's like, okay, I have a batch of 20 scarves that all need to be kind of wrapped up and ready to go. It's so much easier. And it's like, okay, I make a scarf, then I'm gonna make a pair of gloves, then I'm gonna make a golf bag, and then I'm gonna make an apron. Like there's so much switching time that takes so much time that is easier if I batch. And then I'll like wrap them all up together, then I'll weigh them all together and then I'll print out all the labels together and like I will batch something. It's like there's ways to do it that way.

100%.

And if you sell a bunch of stuff that sell, what should I say? Like, even if you sell different items, but you know, a lot of people buy the— I'm gonna, I'm just gonna say soap cuz we talk about soap a lot. It's an easy example, but it's like a lot of people buy the vanilla scented 1-ounce block of soap. And I know they're gonna do that and they buy on its own. So I'm gonna have like 30 of them already packaged up in the packaging. And all I need to do when an order comes in is slap on the label. Things like those. Things like, and it's like, what, for the people who do buy more than one thing or buy different stuff, I'm gonna do that manually. But I know a bunch of those orders are coming in, so I have it all ready. Like I see, I see people who sell, they only sell one type of product in their shop. And do really well. I was watching someone on TikTok Live doing this, but every time an order comes in, they're like, put the thing in the box, and they put the box in a bag, and I was like, you could just have those already. I know it gives you on the to-do list.

It wouldn't be as good a video that way.

No, but like, in general, it would be easy to just, all I need to do is stick on a label. That's another task, like, the folding up boxes ready to go. Like, if everything sells in boxes, having those fold it up and ready to go, makes it easy. There's a whole bunch of those kind of like the net tech automation we don't think about.

Yes, that's the kind of stuff like I always think about when I have slow seasons or slow days. I try to have a jar because just if, if I have a list, I'm not going to want to do the first thing on the list because I'm contrary like that. But if I have a jar of randomized, like, what are prep things that I could do? Oh, you can cut chains for necklaces. We can sticker boxes if we have them. We can fold boxes and have like, what's my minimum that I like to have prepped? 25 boxes? Okay, if we're not at 25, let's fold some so we get to that. But any of that kind of— there's digital prep and automation and systems, and there's physical systems, and you can totally get yourself into a really good place for when the sales shit hits the fan and things are insane. By getting some of this stuff done ahead of time.

Yeah, there's so much.

Did I just push us into the explicit rating?

I think you did that a long time ago.

Oh, I didn't know if it was on an individual podcast basis. I didn't think I cursed too much this time.

But I was watching someone and like, I always package everything up and then weigh it for an edible, but I was watching them in the backend of their Shopify putting all like, weighing everything and putting the weights in, and then it calculates all their stuff. The weight of the package automatically. Like they had all of their, in all their products, and then they weighed the package and you can put that in somewhere in the backend of Shopify and then it has it all weighed for you. And I'm like, ooh, that's like a really smart thing that I know I like ignore those boxes on the backend, but it was like, there's a bunch of smart stuff to save time. 'Cause I always, I have a tiny set of scales and some of my parcels are really big and then I can't see the screen to see how much they were. Like if I just had it all automatically done. It sure probably wouldn't be perfect. I know.

Have you ever done the one with the scale where you have the big box on a scale so you can't see a thing, so you wait for it to beep, then you take a— you put your phone underneath the package to take a picture of what it said?

Mine, it has a hold button to like keep the weight on the screen, and I like push it and move the box.

My hold button doesn't work on my scale.

Yeah, it works sometimes, it doesn't work other times. Like, I have to do it again, and Like the people at my post office are—

then you have a horrible post office.

Yeah, the most horrible people you can imagine. I have stories about the post office and like, well, be horrible if we should do a whole podcast that's just shipping nightmares. Yeah, it's like, oh, you're 1 gram off, like take it home and start again. I'm like, okay, so like that wouldn't work in that case. Like if I have something I can just stick in a post box 'Cause like, I have, it's cheaper if I go to the post office and do it all properly. But if there's stuff I can kind of cheat on, I'm like, I'm gonna cheat. Especially if I properly use my business account, I can stick everything in a giant sack. Then you just hand them the sack and then they can't double check how much it weighs. It's like you do the sack and you put on a zip tie with a tag with all your details on it. It's like, they can't, now, like now you can't. Like, shout out to me for being one grandma.

And of course, the best way to do any of these things is to get a customer in first. Best way to get a customer in is to give them a reason to buy. What's the best reason? Flash sales! And lucky for you, we have an entire guide on how to set up your flash sale this weekend in a snap. It's called our Flash Sale in a Snap Guide. That was a lot of repetition. That's okay. And you can grab that for free, totally, by going to theproductgrowthlab.com. Kit.com/flash, right? Did I get that right?

Yeah, that's right. But I have really good news. You can now also go to theproductgrowthlab.com/flash, leave out the kit, and it will take you, it will redirect you automatically. I feel like I broke your website a few weeks ago and I finally fixed it. Also, don't go to productgrowthlab.com. It's a total mess.

We're working on that.

Yeah, we're working on that. We'll have a whole launch we'll talk about. But yeah, go ahead, grab that, and let us know how you get on in our Facebook group.

Yes, sir.

Thanks for tuning in to the Product Growth Lab podcast. We hope you found today's episode insightful and inspiring. If you enjoyed the show, please leave us a review. It helps us to reach more creative entrepreneurs just like you. Stay connected and keep experimenting. Follow us on your favorite podcast platform and don't forget to join our community for more resources, tips, and support. Until next time, keep growing and creating. This is the Product Growth Lab signing off.