How Candle Warmers Made the Switch from Wholesale to D2C Ecommerce [Video]

Pauline Shiu

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September 25, 2020

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The world is changing as we know it. The lines between manufacturers and retailers are blurring, and brands like Candle Warmers are eager to jump into the ecommerce ring themselves.

Coco Peterson has been at the helm of this movement. As ecommerce manager for Candle Warmers, Peterson has led the company through major shifts in its organization to handle B2C ecommerce in-house. Following changes to warehouse, staffing, product development and more—the company is hardly the same company it was two years ago.

In this episode of "Ask the Ecom Experts," Peterson walks us through her company's journey and provides her advice on how to make this major transition with poise and a strong game plan.

Watch "Ask the Ecom Experts" Episode #8


The Full Transcript

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<div id="intro"></div>

Introduction to Candle Warmers (0:01)

Pauline, Director of Marketing, Zentail
Hi, everybody. It’s Pauline with Zentail. I'm back for another round of "Ask the Experts." Today, I'm here with Coco Peterson. She is the ecommerce manager from Candle Warmers. Coco, hey, nice to have you here.

Coco, E-Commerce Manager, Candle Warmers
Hi, thanks for having me.

Pauline
Absolutely. So, Candle Warmers—feels like we're at the end of September here, about to head into Q4. I feel like you guys have a lot ahead of you, just candle warmers as a category. I think folks can guess that you have something to do with candles, but it's actually a little bit different. So, can you, for everyone who's watching, just give a brief overview about Candle Warmers?

Coco
Yes, so our company actually started several years ago, when the founder's neighbor actually had their house burn down from a candle.

So he came up with this way to use a warmer to melt the candle. And we were the first candle warming company, and we had just grown our line...from lamps that will melt them from the top-down to just the traditional warmer that melts either a candle or a wax melt. And we have grown from there.

We do have our own fragrance line that we offer as well, but our bread and butter really is our hardline products—those warmers that help you use whatever fragrance you want in a way without a flame.

Pauline
Got it, great. Very good. So founded in the early 2000s. Been around roughly 20 years, nice. A lot changed in that time. Can you talk us through some of the key milestones of Candle Warmers and how you went from a really terrible mishap [concerning your founder's neighbor] to now this national/international corporation?

Coco
Well, I've only been here for two years so I can speak to little bits that I heard before me and then what has happened since I've been here. I know that [the company was] able to continue to grow through the recession through the different challenges that happened in the early 2000s because….people want their space to smell nice. They want their space to feel nice, and smell is definitely a huge part of ambiance.

So, that has [helped us to be successful, as well as the fact that we have] an ownership team that is very thoughtful and particular with everything that they do.

Then, a few years ago, [the founders] decided that there is something to this ecommerce thing. Maybe we should start selling more online. And they started dipping their toe into the water and getting products on our website for sale, as well as outsourcing—having companies list them on places like Amazon and things like that.

[The company] brought me on the team to start bringing that in-house and really help our company become an ecommerce partner with our B2B customers, as well as really grow that B2C relationship with customers, whether it's through a marketplace or directly.

<div id="challenges"></div>

Challenges and Perks of Going from Wholesale to D2C (3:09)

Pauline
Hi, guys. Coco had to just shift rooms real quick to make sure that we had some good audio. It looks like we're back and we're good. 

Where we trailed off in the conversation—I think I was getting really excited about your transition from being solely focused on wholesale to then diving into, you know, D2C. I know that you weren't there for all of it, but I'd be interested to know, what were the overall impacts that you're aware of that happened in that pivot?

Coco
Mm-hmm. The biggest was definitely in our warehouse and operations that way, just simply because B2B is very different from B2C when you're shipping boxes and pallets versus Susie gets this package and Davie gets this package and figuring out what they wanted.

Also customer support...when a buyer is buying, they're usually working with a salesperson versus making sure that we have customer support. So, Susie or Davie call and [they need to] have someone to talk to because they don't have a sales rep. And the sales reps, that's not what they want to do. It's customer support.

So, those are two probably bigger things. And then the other is just being able to expand our product lines to more of those products that a store might not necessarily be looking for, but an individual customer is looking for. Stores want to go with things that they know have a good track record for sell-through, whereas we [can] be a little bit more innovative when we're working directly with the customer.

Pauline
I was going to say, does that mean that you get to test out a new product or product line B2C first before you blow it up and make it B2B?

Coco
We can. We do have that ability. We haven't had to do that very much yet because...we're more on the young side of being direct-to-consumer. And with COVID, we've just kind of been running as fast as we can to keep up with the demands that we've run into. As soon as we get the product, we just tell everybody about it.

Pauline
Right. Okay, so it sounds like one of the first things to tackle was your warehouse. What were some of those early things you had to make sure were covered for B2C that were new, as opposed to things you had existing for B2B?

Coco
Shipping processes for sure. Everything that we order from the factory is drop-tested in case packs, and so making sure that our individual packaging could pass a drop test, or at least once it's packaged in a box to ship out, it's passing our drop test. Most of our products are ceramic so, you know, that does not fare well...especially when it gets around to the FedEx truck.

Pauline
Bingo, yes. The wax probably fares a little bit better than the ceramic pieces.

Coco
Yes, that is true. Although there is a season in which we're not allowed to ship wax either with different carriers because, think about Arizona, it's 120 degrees. That's about the melting point of our wax. So, there are certain times we don't ship a lot of wax as well for that reason.

<div id="software"></div>

Finding the Right Software for D2C Ecommerce (6:22)

Pauline
Wow, I never thought about that, but it makes a ton of sense. That applies to both B2B and B2C, just [given] the product line. Interesting, interesting. Okay. Let's see. Internally...did your software also align? Or you need to expand or differentiate B2B [versus] B2C systems?

Coco
Yes. So, our company as a whole uses NetSuite to manage all the various aspects of our business. And NetSuite is a great system, but it is also a system that has been around for a long time and it isn't really dynamic enough to keep up with the direct-to-consumer world as much. So finding something that is robust enough to integrate with NetSuite but also can handle the dynamic changes—that was really the hardest thing.

When I started, we were with ChannelAdvisor, which at the time...was the only native connection with NetSuite, which is why we used it. I absolutely, absolutely did not enjoy my experience.

Pauline
I mean it affects your business, so that's terrible to hear.

Coco
Yeah, it does. It does. So I lobbied really hard for a change, and that's when I was introduced to Zentail, and then I made the change.

<div id="chad"></div>

ChannelAdvisor vs. Zentail (7:54)

Pauline
We are really grateful that you guys have been awesome customers, and that we're here talking today. So I guess what was the biggest difference? What was the biggest pain point that you had that you were looking to solve?

Coco
[ChannelAdvisor’s] customer support was just horrible. The person who set up our account had never really worked in ecommerce before. So she [came from] traditional marketing, and they had her set it up, and then they brought me on later.

So I kind of stepped into a mess that she hadn't meant to create, but it was just not set up the way that someone with the [ecommerce] experience would have set it up. And then to try to work through that to fix it…[our team was] paying by the hour and buying little service kits and different things. Then once we were on those phone calls, we'd get a flippant person with a bad attitude who didn't really want to help us.

Pauline
That's painful.

Coco
Oh, it was so painful. And so I basically deactivated every aspect of ChannelAdvisor except for the order sync so that we could make sure that we were still keeping track of our orders and our inventory. But as far as listing things and everything like that [went], I was just managing them in the channels themselves because...I didn't want to deal with the mess that they were creating anyways. So that was something that, when I was shopping around, I was really looking for someone who, if I did run into an issue, was going to help me. It's fine to pay for service, but if I came for a service, that service gets provided.

Pauline
Correct. Yes, absolutely. That's great to hear. I think that our team really does pride itself on service and...I think we treat all of our clients more as partners than as, you know, ‘paying customers.’ And so that's great to hear that you came to us. Obviously the software has great capabilities but our team is something we are proud of so that's nice to hear.

Coco
Oh, for sure. And…[Lenore from the Zentail support team] is always like right there for me.

Pauline
She's great. She's so great.

Coco
Yeah, she's great. But especially because Zentail being a younger company in the space—there are certain sites that you're not yet linked to, but that customer support is really what made me decide, "You know what? You will get there. [You’ll eventually offer integrations into other channels.] In the meantime, the rest of my life is smooth." That makes a huge difference.

Pauline
Appreciate it. I know that there are channels that we are looking into that we want to make available to sellers. Also, I think that we kind of have the core [channels]. [In other words,] if you're going to spend your time on anything, focus on these and then everything else is just, like, plus, plus. But this is really the meat of it. So I hope we were able to support you that way.

Coco
Yes, absolutely.

<div id="internal"></div>

How B2C and B2B Teams Coexist Internally (10:46)

Pauline
Nice, cool. All right, thanks. I wasn't expecting that, but thank you for all those comments. If we can maybe pivot back to this whole B2B, D2C, B2C—however you want to call it—shift. All right, so we have software, support handled, etcetera.

Can you speak to how things are handled internally? I know that sometimes we speak to brands and they are hesitant to make the shift. They're not sure how to make all those changes. And then even internally, there's a fight. There's the B2B team against the B2C team, whether it's [surrounding] sales numbers, priorities with business plans and inventory but, you know, how do you guys balance that out at Candle Warmers?

Coco
So we have a person named Marly. She kind of controls the inventory side of things. She's over the purchasing, and she also controls who gets what inventory. None of us, no matter who we are, can send any inventory to anyone unless Marly has approved that we have that inventory allocated.

In our Zentail account, we have an ecommerce warehouse that I can use for...all of my sites, but she's the one that puts things in there. I do not. So having a Marly is very important.

Pauline
Very good, very good.

Coco
She's very good at what she does.

Pauline
‘Does she accept bribes?’ is my next question.

Coco
I know, right? I haven't found what will bribe her best yet. I need to figure that out. That's a good idea.

And then also just internally, we...added an ecommerce specialist that works under me but also works with the sales team specifically so that that relationship between the buyer is with two people: a sales person and an ecommerce person. [This is] so that we can make sure that we're aware of their ecommerce efforts, their promotions, the different things that they want to do, and make sure that our listings on their websites are completely optimized with whatever our marketing team has available. That is something that...the sales team has been a little bit in the dark in the past, because they've been so focused on the sales part. They're just more doing the traditional sales thing. They haven't known, like, ‘Oh, I have this video or this graphic that's going to break down the fragrance for my customer,’ because looking at a fragrance without smelling it is a very different experience, so adding that really helps with the conversion online.

<div id="resellers"></div>

What about Resellers? (13:35)

Pauline
Okay, cool. So to clarify, it sounds like you guys do work with resellers.

Coco
We do not have resellers. We have an IMAP policy. We do not allow people to sell our products on third-party marketplaces. That is our space. That is my space. I am very territorial.

Pauline
Don't mess with Coco's space. Got it.

Coco
No.

Pauline
[Amazon] Brand Registry.
I imagine you're already there?

Coco
Yes, yup.

<div id="results"></div>

How Selling D2C Impacted Business (14:00)

Pauline
Taken care of. Taking care of business. All right, great. So they brought yourself on. You've been at the D2C commerce game for roughly three, four years. How has D2C made an impact on your guys' business?

Coco
Well, when I started, Amazon specifically (because that is our biggest D2C channel) was kind of just the little side project that wasn't really getting a lot of attention. It was doing okay sales here and there—roughly about the same as our website was [doing] with our customers B2C.

[Now,] it is our biggest account. We've worked with a lot of large retailers that we also do private label for, but obviously I can't say who those are...but we are selling more on Amazon than anywhere else right now.

Pauline
That is phenomenal growth.

Coco
Yeah, yes. It's grown. I mean, we joke that we have a tiger by the tail because we're trying to project things, and it just keeps growing and growing as we optimize. Then COVID happened, and then it continues to grow. Then, you know, holidays happened, and it's continuing to grow. So it's really such an exciting space to be in right now but it's also...it's got its stresses, too, but it's grown exponentially since I've been here.

Pauline
Cheers. That is phenomenal. That's awesome.

Coco
Thanks.

<div id="q4"></div>

Getting Ready for Q4 in Half the Time (15:37)

Pauline
Cool. You brought up COVID. I feel like you can't have a conversation these days without bringing up COVID. So how has it affected your business? What are you expecting for Q4? Everyone's saying that this will be, of course, impressing—and I hate that word now but—[it’s spinning up to be] an epic ecommerce Q4. But aside from that, you are a seasonal product. When I think fall, [I think of lighting] my candle or [plugging] in my candle warmer.

Coco
There you go. So...generally, springtime, summertime, we see a bit of a dip, which a lot of ecommerce companies do unless you're in the outdoor space. But we actually did not see this dip this year, and it's because people are in their homes. If you're in your home, you don't want it to smell like your dog. You don't want it to smell like your kids' dirty feet. You want it to smell [how] you want it to smell.

And we definitely saw an increase in our use of essential oils and diffusers as people were trying to make their home feel more like an office space...

So, we definitely did not see a lull at all, which has caused a bit of a challenge as we're getting ready for Q4 because normally during the summer, that's my prep time for Q4 where, you know, I'm working on site, and optimizing, and doing different things where I have not had the time to do that. And so, you know, every day it's like, "Ugh, I've got all of these things I've got to do."

So it's really affected the prep that I normally do. It's also affected as we have tried to forecast for inventory—you know, because we weren't expecting to have those high sales when nobody else was able to open. Because [our team was] so used to that B2B model, the thought was, ‘Oh, well, people are closing. We're not going to be able to open.’ But then, we continued to brainstorm as a marketing team and to innovate critical ways to help even our small ma-and-pa brick-and-mortar shops be able to do drop-ship, and we just didn't slow down.

Pauline
Really good. You guys sound like you're always really nimble and adapting to just whatever the world throws at you.

Coco
We try.

Pauline
So that explains your growth. It does. It's perfect.

Coco
Yes, yes. We try.

Pauline
So for Q4, are you still expecting a gangbuster Q4? Do you think that it'll kind of calm down because people have already been buying or, just because it's a really giftable product, you'll continue to see it soar?

Coco
Yep, we are fully projecting a typical spike towards the end of the year because, yeah, totally giftable. It's definitely a feel-good product. You can count on feel-good products during times when people are stressed. Whether it's food or smell or skincare, you know that people want to feel good. And so we’re just in one of those categories.

Pauline
Sorry, are saying that this is one of those...is this one of those stressful times? I had no idea.

Coco
I know. Are people stressed right now? I don't know. People seem totally normal.

Pauline
Yeah, I'm fine. I'm fine. I'm fine. I'm fine. I'm fine. I'm great. 

Well, that's awesome. Obviously, we love sales graphs that go up into the right. So we'll be monitoring your Zentail account. When would you have normally started that prep like you're saying? Like back in Q2, like end of March, once Jan. 1 hits?

Coco
For optimizing...?

Pauline
For Q4 in a normal period.

Coco
So normally we do new product launches usually the first of January and then the first of July. So, around June, when I started getting information about our new products and any new product lines, any running changes we're doing to product lines, anything like that—that's when I would start getting those incorporated on our websites and getting them incorporated in out listings, and working with the rest of the marketing team to make sure that anything that we need to have videos of have been done.

So that is the part that we haven't really...we did do some product videos for this last launch that launched in July. And even that was different because [the team] just dropped the videos off at the videographer and just said, ‘Do your best to copy our style with the styling.’ I mean, he did a great job, so you can't tell that they weren't styled by the team member that normally styles them. But things like that have just been...you know, things are just different right now.

<div id="future"></div>

What the Future Holds for Candle Warmers (20:04)

Pauline
Yeah, very true. All right, I guess the last question before we have a little fun, what's ahead for you guys in the future? What's part of your growth strategy?

Coco
Definitely innovating in the home fragrance space, making sure that we are not just an accessory that you want to buy to have with your favorite candle, but also become the source for all types of home fragrances in your home.

[We] are looking at different types of products to clean the air and diffuse different fragrances in the house. That's something our product development team is working on: continuing to develop our Airomé main line, which is aromatherapy/essential oils, because so many people really care about cleanliness, security and don't want the toxins in the air that they get from other home fragrance products.

So that is really where our product team has been growing, and I'm excited to go there with them because I think that we can definitely sell them.

Pauline
Nice, exciting. That is awesome. Again, staying ahead of the curve is so important, so congratulations, you guys.

Coco
Thanks.

<div id="rapidfire"></div>

10 Rapid-Fire Questions (21:14)

Pauline
Okay, great. So here are some 10 rapid-fire questions for you. Are you ready?

Coco
Yes.

Pauline
Okay. What advice do you have to other D2C brands that are just starting out?

Coco
Make mistakes often and correct them quickly. Just go as fast as you can.

Pauline
Very good. What has been one of the biggest hurdles that you've had to overcome along the way?

Coco
Patience. I am not a patient person, and I am very much a do-it-myselfer. And so, I will figure out how to fix it myself. The hardest part with working in a team, especially a company this size, is having so many people having to touch things and I'm like, ‘Ah, don't touch.’

Pauline
Yes, yes. You're getting so big, you're almost going corporate. Wow.

Coco
Yeah.

Pauline
Okay, when you think about something that has added the most value to your organization as you've grown, what comes to mind?

Coco
I would honestly say our hiring practices. Our ownership team is just so good at making sure that they find people who are really good at working as a team and being cohesive, even though they hired me and I am the impatient person who wants to do things by myself.

Pauline
Well, you've also grown a channel to a tremendous amount, so good hire. Good hire.

Coco
And I'm funny and I dance around the office, so there you go.

Pauline
There you go. I would like to work with you.

Coco
Yeah.

Pauline
Let's see. What do you think it is about your product specifically that your customers love?

Coco
Quality is definitely a big part of everything that we do. We make sure that we meet a price point so that we are able to be in some of those bigger big-box retailers that have a price-point sensitive customer but making sure that that does not skimp on quality.

Pauline
Nice, very good. While also having some good ties to the U.S. so that's awesome.

Coco
Yes, yes.

Pauline
All right, tell me about your morning routine.

Coco
Take my dogs out to go potty immediately. Wake up, take my dogs to go potty, and then actually one of the first things I do is turn on my essential oil diffuser and add oils and start my day off with some of our fragrances.

Pauline
Absolutely, very good. What is your favorite food?

Coco
Chicken enchiladas.

Pauline
Nice. Very good. Tell me one of your hobbies.

Coco
Oh, gosh. I have taken up needlepoint during COVID. I had a friend who just found something on Etsy she wanted done, and I was like, ‘Okay.’ And so now I've just been being a little grandma in my house with my dogs making my little needlepoint.

Pauline
Very cute. That is great. My daughter wanted to take up knitting and crocheting. I was like, ‘Yeah, sounds about right.’

Coco
One of my friends picked that up.

Pauline
We've got a lot of time.

Coco
I do the needlepoint, she does the crochet.

Pauline
Excellent. What are your dogs' names?

Coco
Podrick. That's from Game of Thrones. And Monty after Monty Python.

Pauline
Very, very good. That sounds great. Okay, what is an item on your bucket list?

Coco
I would love to go to Bali. That place just looks magical to me. That is on my bucket list.

Pauline
Me, too. Take me.

Coco
Yep. Okay, let's go.

Pauline
Very good, very good.

Coco
As soon as we can travel again...

Pauline
Exactly.

Coco
...as U.S. citizens cannot basically go anywhere right now, let's go to Bali.

Pauline
Yeah. Oh, yeah. There's that.

Coco
Yeah.

Pauline
Okay. All right, last one. What has been one of the most impactful life lessons for you, whether it's personally or professionally?

Coco
Always keep going. I graduated thinking I was getting into interior design. I studied that. That's what I was going to do. I worked in it. Then, 2008 hit. Nobody was designing homes.

So I've had to be flexible. I've had to learn. I've had to definitely grow as I go and be very dynamic—be open to saying, ‘Okay, this job, I'm going to learn a ton. I might not make the money I want to make.’ And so, at one point, I was learning product development and marketing as well as, at night, working at California Pizza Kitchen just so that I could make sure that my income was where I needed it to be.

So, I would definitely say be flexible and be open, and just keep learning because otherwise the world kind of leaves you behind.

Pauline
Way to go. I love that a lot, and I like that you've been able to obviously see the positive in all of that. Clearly, you've ended up in a great spot with a huge smile on your face, dancing around the office. So that's excellent. Very good.

Coco
Thank you.

Pauline
Coco, this has been a great conversation. Thank you so much. Your journey and the company's journey sounds awesome. Again, thank you for all the kind words, and we will check in with you at the end of Q4 and see how that exponential growth looks.

Coco
All right, sounds great. Thank you.

Pauline
Thank you. Bye. Take care.

Coco
Bye.

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